PT Suparma Tbk (SPMA), one of the leading paper companies in Indonesia, is facing severe pressure after its stock price plunged sharply by 52.9% to IDR 354 per share. This significant decline from its all-time high has created uncertainty and concern among investors.
The data shows that SPMA's stock price experienced a drastic decline, coinciding with its third-quarter 2023 net profit, which also reached its lowest point since the third quarter of 2020.
According to the gathered information, SPMA's net profit experienced a significant decline of 81.6%, dropping to IDR 24 billion in the third quarter of 2023. This decrease in net profit has raised concerns about the possibility of SPMA's stock price falling even further.
In a public expose, the company stated that the weakening of net sales was due to an 18.5% decrease in the average selling price of its products.
Despite a 2.0% increase in the company's paper sales volume, from 153,992 tons to 156,995 tons, SPMA's revenue was still corrected. This indicates a high probability of a decrease in the Average Selling Price (ASP).
The company further confirmed this in the public expose, stating, "The company revised its sales target because the realization was far from the initially set target. This was caused by a decrease in the average selling price of products, not by a decrease in sales volume, as the sales volume still experienced a slight increase."
This demonstrates that SPMA does not possess a competitive advantage in its products compared to its competitors. The company needs to consider restructuring the average selling price of its products, improving product superiority, and enhancing operational efficiency to address the pressure of declining net profit.
In a dynamic market environment, PT Suparma Tbk (SPMA) is facing serious challenges with a sharp decline in stock price and net profit. The strategic measures taken by the company to overcome this situation will be the main determinant of SPMA's future performance.