Company Coverage
Buana Lintas Lautan (BULL IJ): Positive Momentum In 2H26
BUY (Maintained)
Current price:
Target price:
Upside:
Rp416
Rp750
+80.3%
Analyst
Analyst
Highlights
- Solid 2Q26 results expected. We expect BULL's 2Q26 audited results to be released in August, likely showing a strong qoq performance.
- Double positive sentiment. Sentiment is supported by both ongoing M&A speculation and rising oil prices.
- Maintain BUY with a target price of Rp750 based on 7x 2026F EV/EBITDA, in line with global and regional peers in the industry.
Analysis
- Positive sentiment amid higher oil prices. Brent crude has recently touched the US$100/bbl level (before a correction to the current US$93/bbl), rebounding after softening in June amid rising geopolitical tensions. Tanker traffic through the Strait of Hormuz has declined over the past three weeks. On a more constructive note, several regional tanker rates have shown recovery, with Aframax rates, for instance, having rebounded to about US$77,000/day, though still below the over US$100,000 peak seen in March. With over 90% of Buana Lintas Lautan’s (BULL) vessels operating overseas on short-term spot contracts, the company is well positioned to benefit from rising oil prices. As noted in our previous report, some contracts saw rates double in 2Q26, which we expect to translate into a strong qoq net profit result. Notably, management has argued that even a potential de-escalation is unlikely to trigger an immediate decline in freight rates, as the conflict has shifted global priorities from energy cost to energy security and availability, a dynamic that should keep voyage distances structurally longer for the foreseeable future.
- A potential deal nearing completion? Media reports indicate that South Korea's IMM Private Equity and IMM Investment Corp are nearing completion of the sale of Hyundai LNG Shipping to Sinar Mas Group, following a months long national security review. Separately, based on public disclosures, BULL has an existing long-term banking relationship with Sinar Mas as a debt provider and the latter has equity stake in BULL via several vehicles. Based on publicly available fleet data on Hyundai LNG's website, we estimate its combined deadweight tonnage (DWT) capacity is about 2.4x BULL's own DWT position as of end-25. Assuming Hyundai LNG’s value is roughly estimated at US$2b, BULL should face balance sheet constraint to fund such an acquisition, hence, a potential corporate action is plausible in our view – though no formal scheme has been disclosed and this remains our own inference rather than confirmed information. We also expect BULL's audited 2Q26 financial report to be released in August, per company. Logically, LNG contracts are usually long term, hence any potential synergy with BULL would provide a diversified balance between spot and recurring revenue streams.
Highlights
- Solid 2Q26 results expected. We expect BULL's 2Q26 audited results to be released in August, likely showing a strong qoq performance.
- Double positive sentiment. Sentiment is supported by both ongoing M&A speculation and rising oil prices.
- Maintain BUY with a target price of Rp750 based on 7x 2026F EV/EBITDA, in line with global and regional peers in the industry.
Analysis
- Positive sentiment amid higher oil prices. Brent crude has recently touched the US$100/bbl level (before a correction to the current US$93/bbl), rebounding after softening in June amid rising geopolitical tensions. Tanker traffic through the Strait of Hormuz has declined over the past three weeks. On a more constructive note, several regional tanker rates have shown recovery, with Aframax rates, for instance, having rebounded to about US$77,000/day, though still below the over US$100,000 peak seen in March. With over 90% of Buana Lintas Lautan’s (BULL) vessels operating overseas on short-term spot contracts, the company is well positioned to benefit from rising oil prices. As noted in our previous report, some contracts saw rates double in 2Q26, which we expect to translate into a strong qoq net profit result. Notably, management has argued that even a potential de-escalation is unlikely to trigger an immediate decline in freight rates, as the conflict has shifted global priorities from energy cost to energy security and availability, a dynamic that should keep voyage distances structurally longer for the foreseeable future.
- A potential deal nearing completion? Media reports indicate that South Korea's IMM Private Equity and IMM Investment Corp are nearing completion of the sale of Hyundai LNG Shipping to Sinar Mas Group, following a months long national security review. Separately, based on public disclosures, BULL has an existing long-term banking relationship with Sinar Mas as a debt provider and the latter has equity stake in BULL via several vehicles. Based on publicly available fleet data on Hyundai LNG's website, we estimate its combined deadweight tonnage (DWT) capacity is about 2.4x BULL's own DWT position as of end-25. Assuming Hyundai LNG’s value is roughly estimated at US$2b, BULL should face balance sheet constraint to fund such an acquisition, hence, a potential corporate action is plausible in our view – though no formal scheme has been disclosed and this remains our own inference rather than confirmed information. We also expect BULL's audited 2Q26 financial report to be released in August, per company. Logically, LNG contracts are usually long term, hence any potential synergy with BULL would provide a diversified balance between spot and recurring revenue streams.
BUY (Maintained)
Current price:
Target price:
Upside:
Rp416
Rp750
+80.3%
Analyst
Analyst
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