PT Alamtri Resources Indonesia Tbk (ADRO) continues to strengthen its commitment to business diversification with a focus on the renewable energy sector. Through its subsidiary, PT Adaro Clean Energy Indonesia (ACEI), ADRO supports the development of green energy projects, including in Karimun Regency, Riau Islands.

In a recent information disclosure, ACEI announced a loan of USD 4.1 million (approximately IDR 66 billion) to PT Karimun Sarana Surya (KSS) on December 23, 2024. The loan carries an interest rate based on Term SOFR plus 1.70% per year and is set to mature on December 31, 2025.

“The purpose of this loan is to support the investment and development of renewable energy projects currently managed by KSS,” according to the disclosure document released on Monday, December 30, 2024.

This initiative is part of ADRO's strategy to build a more balanced and sustainable business portfolio, aligning with global trends toward clean energy. The company views these projects as opportunities to achieve profitability while positively impacting society and the environment.

“By investing in green energy projects and leveraging innovative technologies, we aim to enhance competitiveness and contribute significantly to sustainability,” the management stated in the disclosure.

KSS, a subsidiary of ACEI, is actively developing renewable energy projects in Karimun. The loan provided by ACEI complies with Article 3 of POJK 42/2020, ensuring adherence to regulatory standards.

ADRO’s long-term strategy includes integrating renewable energy into its business portfolio. This transition not only enhances the company’s financial performance but also supports the global agenda for a sustainable energy transition.

The renewable energy projects managed by ACEI are expected to play a key role in transforming ADRO from a coal-based company into a green energy solutions provider.

On December 30, 2024, ADRO's shares fell 3.94% to IDR 2,440 per share, coinciding with the ex-date for the interim dividend distribution for the 2024 financial year, valued at USD 200 million (approximately IDR 3.25 trillion).

According to research by Sucor Sekuritas, ADRO is a prominent player in the renewable energy sector, offering significant valuation potential. Its 0.4 GW solar panel project in Batam has received an export permit to Singapore, and its 1.3 GW hydroelectric power plant is projected to deliver a return on equity (ROE) of 31%. The company’s total renewable energy capacity stands at 1.7 GW.

Sucor Sekuritas estimates the net present value (NPV) of ADRO's renewable energy projects at USD 4.2 billion, with an EV/EBITDA multiple of 3.7x and an internal rate of return (IRR) of 15%. These investments are anticipated to increase the company’s valuation by 56%.

With a target price of IDR 4,500 per share, Sucor Sekuritas recommends a "buy" rating, suggesting the recent share price decline offers an attractive long-term investment opportunity. At current levels, investors stand to gain significant returns.

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