Stock Valuation on IDX-Listed Retail Companies Using DCF with FCFF and Relative Valuation (2021-2025 Projection)

Abstract

This study aims to examine the intrinsic value of three companies' stocks in the trade, services, and investment sector with the greatest market capitalization listed on the Indonesia Stock Exchange (IDX) in 2021. Data from 2016 to 2020 was used to calculate each company's historical performance. Then the projection of 2021 to 2025 was made based on three scenarios: optimistic, moderate, and pessimistic. To determine the intrinsic value of these companies, this study employed Discounted Cash Flow (DCF) method with Free Cash Flow to Firm (FCFF) approach, as well as the Relative Valuation method with the Price to Book Value (PBV) and Price to Earnings Ratio (PER) approaches. It was found that based on the DCF and RV-PER and PBV analysis in all scenarios, ACES stock is considered to be overvalued. On the other hand, based on the DCF method in all scenarios, MAPI stock is considered to be undervalued, while the RV-PER and PBV show that the stock is overvalued in all scenarios. Based on the DCF method in all scenarios, AMRT stock is considered to be undervalued, while the RV-PER and PBV show that the stock is overvalued in all scenarios. In conclusion, ACES is overvalued by 1.6%, MAPI is undervalued by 1.203%, and AMRT is undervalued by 1.136%.