E-ISSN: 2809-8544
EQUITY VALUE ANALYSIS WITH THE INCOME APPROACH IN
PALM OIL PLANTATION COMPANIES (CASE STUDY: PT SISIRAU
AND PT SATYA AGUNG)
Alfred Johnson Sianipar1*.
Khaira Amalia Fachrudin2.
Darmawan Dwi Atmoko3 Universitas Sumatera Utara.
Indonesia Email: alfredjohnsonsianipar@gmail.
com1*, khaira@usu.
atmoko@kemenkeu.
Abstract Equity value is the net worth that belongs to the owners or shareholders of a company after all liabilities have been settled from the total assets owned.
Equity value reflects the portion of net ownership in the company that truly belongs to the shareholders.
This study aims to analyze the equity value of two palm oil plantation companies in Indonesia.
PT Sisirau and PT Satya Agung, using an income-based approach through the Discounted Cash Flow (DCF) method.
This approach is considered highly relevant for valuing companies with long-term income prospects and relatively stable cash flows, as is typical in the palm oil plantation industry.
The study is also strategically significant, as both companies are preparing for an Initial Public Offering (IPO), where valuation becomes a key consideration for potential investors.
The data used in this research consists of audited financial statements from 2017 to 2024 and financial projections for the period 2025 to 2034.
The research applies a quantitative approach combined with descriptive analysis, using both primary and secondary data.
Equity value is estimated based on projected Free Cash Flow to the Firm (FCFF), discounted using the Weighted Average Cost of Capital (WACC).
The analysis also considers business risk, cost structure.
CPO price trends, and relevant government regulations.
The results indicate that the income approach provides a more accurate estimate of equity value, reflecting the future economic potential of the companies.
PT Satya Agung has an indicative equity value of IDR 3.
85 trillion, significantly higher than PT Sisirau's IDR 1.
67 trillion.
This difference is attributed to PT Satya Agung's stronger cash position, lower debt burden, and higher growth Therefore.
PT Satya Agung is considered more suitable to proceed with an IPO in the near This study concludes that the DCF is highly appropriate for valuing companies with longterm growth orientation and stable cash flow.
Moreover, the findings contribute to academic literature and serve as a practical reference for companies, investors, regulators, and academics in understanding income-based equity valuation, particularly in the palm oil plantation sector.
Keywords: Company Valuation.
Equity Value.
Discounted Cash Flow.
Income Approach.
FCFF.
IPO.
Palm Oil Plantation.
INTRODUCTION
Palm oil is one of Indonesia's leading commodities and plays a vital role in the country's economy.
Indonesia is the world's largest palm oil producer, with numerous companies involved in the plantation, processing, and export of palm oil products.
Palm oil produces palm oil, which is used in various consumer products, cosmetics, and biodiesel.
Furthermore, palm oil contributes to state revenue and creates jobs for millions of people, particularly in regions that rely heavily on this agricultural sector.
With its continued growth prospects, the palm oil industry faces significant challenges and opportunities, making it crucial to evaluate the economic value of companies operating in this sector.
The following data presents palm oil performance in Indonesia.
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54443/sibatik.
Ton .
alam jut.
CPO
2017 2018 2019 2020 2021 2022 2023 2024
Tahun Figure 1.
Palm Oil Production Data in Indonesia Source: Indonesian Palm Oil Association (GAPKI).
Annual Data 2017-2024 Figure 1 shows the trend of palm oil production in Indonesia from 2017 to 2024, consisting of Crude Palm Oil (CPO) and Palm Kernel Oil (PK).
CPO production experienced a significant increase from 38.
17 million tons in 2017 to a peak of 47.
10 million tons in 2019, then remained relatively stable in the range of 46Ae47 million tons during the period from 2020 to 2023, before increasing again to 48.
16 million tons in 2024.
Meanwhile.
PKO production showed a relatively stable trend in the range of 4.
1 to 4.
6 million tons throughout the same period.
These data indicate that Indonesia has consistently maintained a high palm oil production capacity, with fluctuations influenced by factors such as weather conditions, export policies, and the impact of the pandemic.
Figure 2.
Equity Value of PT Satya Agung and PT Sisirau Source: Annual Report of PT Satya Agung and PT Sisirau 2017-2024 SIBATIK JOURNAL | VOLUME 4 NO.
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54443/sibatik.
Figure 2 shows the development of the equity percentage to total assets of PT Satya Agung and PT Sisirau during the period 2017 to 2024.
In general, it can be seen that PT Sisirau has a much higher equity percentage than PT Satya Agung at the beginning of the period, which is 88.
41% in 2017, while PT Satya Agung is only 43.
However, there is a gradual downward trend in PT Sisirau's equity from year to year, reaching 50.
10% in 2024.
Conversely.
PT Satya Agung also experienced a consistent, even sharper decline in the equity percentage, from 46.
20% in 2018 to only 17.
99% in 2024.
This decline indicates that both companies are increasingly relying on debt financing in their capital structure, especially PT Satya Agung which shows a tendency towards higher leverage.
Nevertheless.
PT Sisirau still maintains a relatively healthier capital structure as seen from the larger proportion of equity compared to PT Satya Agung throughout the period.
Academically, this research also contributes to the literature on company valuation, particularly in the palm oil plantation sector.
Previous studies, such as Damodaran .
Copeland et al.
, and Franks et al.
, emphasize that the income approach, particularly the Discounted Cash Flow (DCF) method, is highly appropriate for companies with measurable and sustainable revenue projections.
Even at the MSME scale, as demonstrated by Tsurumi and Nara .
, this approach is considered more accurate in reflecting a company's economic value than the asset-based approach.
Therefore, the use of the income approach in valuing PT Sisirau and PT Satya Agung is expected to produce credible, strategic, and appropriate equity value estimates that reflect the current reality of the plantation business.
LITERATURE REVIEW
Basic Theory of Assessment Assessment, which is a translation of the English word appraisal, means the activity of conducting an assessment process on a particular object or thing.
According to the Indonesian Society of Professional Appraisers (MAPPI), assessment is literally a process or activity to express an estimated value and opinion on a particular object within a certain period and with due regard to applicable provisions such as KEPI (Indonesian Appraisal Code of Ethic.
and SPI (Indonesian Appraisal Standard.
or other legislation (MAPPI.
Investment Investment is the sacrifice of resources .
ime, money, and effor.
today in the hope of gaining more resources in the future (Laopodis, 2.
From this perspective, investment can be understood as a sacrifice made today to gain future benefits.
The purpose of investment is to generate income or appreciation through the acquisition of assets or goods (Hayes, 2.
The value of an asset tends to increase over time due to appreciation.
People who purchase goods as investments do not do so with the intention of using them for consumption, but rather to generate wealth in the future.
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org/10.
54443/sibatik.
Entity According to Hutomo .
, an entity .
can be defined as a sign of participation or ownership by an individual or business entity in a company or limited liability company.
An entity is a piece of paper that states that the owner of the paper is the owner of the company that issued the securities.
The portion of ownership is determined by the amount of investment invested in the company.
Entities are the most popular and widely recognized securities in the community (Tandelilin, 2.
Valuation by Income (Income Approac.
Income can be used to estimate Value by anticipating and quantifying the ability of the Assessment Object to generate returns that will be received in the future.
Common methods used in income valuation are:
Discounted Cash Flow Method.
Capitalization of Income Method The above method can only be used if the management of the Object The assessment has prepared a business plan that will be used as the Basis for Value .
usiness plan-based valuatio.
Conceptual Framework of the Research The conceptual framework of research is the primary foundation upon which research activities are fully oriented (Trisliatanto, 2020:.
In this case, the researcher creates a research framework to facilitate understanding of the flow and objectives of the research to be conducted.
Figure 3.
Conceptual Framework SIBATIK JOURNAL | VOLUME 4 NO.
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org/10.
54443/sibatik.
Using the Income approach, this study will assess companies based on their capacity to generate future cash flows.
The method used is Discounted Cash Flow (DCF), which calculates projected free cash flows and then discounts them to their present value using a discount rate that reflects business risk and investor return expectations.
This approach is considered highly relevant for PT Sisirau and PT Satya Agung, as both operate in the palm oil industry, which has long-term growth prospects.
Key variables such as crude palm oil (CPO) prices, operational costs, and land productivity are key components in estimating future cash flows.
METHOD
Conducting research requires a research method that functions as a method or process used to solve a problem.
The research method will help researchers as a guide to systematically direct the research.
Based on the problem formulation and research background that have been described, the type of research used is descriptive research.
Descriptive research .
or taxonomic research is a research that aims to create a systematic, factual, and thorough description of the facts and characteristics of a particular population or area, and expands on only a few specific variables .
ot in-depth like a case stud.
(Trisliatanto, 2.
Location and Time of Research The research was conducted at the Head Office of PT.
Satya Agung and PT.
Sisirau because the necessary data were available and the financial reports presented were audited financial reports for the 2017-2024 financial years.
This research lasted for two months, from April to May 2025.
Data Types and Sources Primary Data Primary data was obtained through interviews with investor relations and management of PT.
Satya Agung and PT.
Sisirau.
Collecting primary data through interviews with investor relations and management of PT.
Satya Agung and PT.
Sisirau is an effective method for obtaining direct information from relevant sources regarding the company's condition and strategic decisions that can affect the company's valuation analysis.
Secondary Data Secondary data was obtained from literature studies such as company financial reports from 2017 to 2024, newspapers, websites, information and news on the internet and Operational Definition of Variables In company valuation research or analysis, the use of the Discounted Cash Flow (DCF) method requires clear operational definitions of variables so that each variable used in the SIBATIK JOURNAL | VOLUME 4 NO.
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54443/sibatik.
calculation can be understood consistently.
The following are operational definitions of the variables commonly used in both methods (Damodaran, 2.
Cash Flow Projection (FCFF/FCFE) Estimate future cash flows based on financial and industry trends .
Ae10 year.
Formula for FCFF:
FCFF = EBIT y .
Ae T) Depreciation Ae iWorking Capital Ae Capex Determining Discount Rate (WACC) Formula: WACC = (E/V y R.
(D/V y Rd y .
Ae T)) Re is calculated using CAPM: Re = Rf y (Rm Ae R.
Calculating Terminal Value (TV) Using the Gordon Growth Model:
TV = (FCFFn y .
) / (WACC Ae .
Calculating Present Value (PV) Discount all projected cash flows and terminal value to the present using WACC.
Result = Enterprise Value.
Subtract net debt Ie obtain Equity Value.
Revenue Projection Based on historical data, trends, and assumptions about industry growth, economic growth, product prices, sales volume, marketing strategy, and regulation.
Formula: Revenue = Sales Volume y Product Price
RESULTS AND DISCUSSION
Overview of Research Object PT Sisirau is a palm oil plantation company based in Aceh Tamiang.
Aceh Province.
The company owns extensive plantations, most of which are in the mature phase, contributing significantly to its operating income.
Its primary activities include oil palm cultivation, plantation maintenance, fresh fruit bunch (FFB) harvesting, and sales to processors or palm oil mills.
In its operations.
PT Sisirau implements sustainable agricultural practices by adhering to technical standards for plantation management.
The company has a professional organizational structure and a robust financial management system.
This is reflected in its financial statements, which show positive cash flow and stable year-on-year growth from 2017 to 2024.
Equity Value Calculation Using the DCF Approach Discounted Cash Flow (DCF) is an approach to company valuation that involves discounting future cash flows to their present value.
This approach assumes that a company's value is equal to the present value of the cash flows it will generate in the future.
DCF is usually used to assess the feasibility of long-term investments and is very suitable for companies that have relatively stable or projectable operational cash flows, such as companies in the palm oil plantation sector.
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54443/sibatik.
FCFF Projections Table 1.
Projected FCFF Calculation of PT Sisirau Net profit for the Depreciation Amortization Year Interest * .
Cash
Inflow
Capex
Changes in Working Capital Cash
Outflow
FCFF
22,174,802
5,745,895
10,112,936
38,033,633
2,500,000
24,622,327
27,122,328
65,155,961
33,739,905
9,309,000
10,137,734
53,186,639
2,500,000
5,720,484
8,220,484
61,407,123
22,383,908
17,668,000
10,115,892
50,167,800
2,500,000
1,465,732
3,965,732
54,133,531
24,568,281
18,534,000
10,013,421
53,115,702
2,500,000
-211,688
2,288,312
55,404,014
30,734,030
18,534,000
9,792,097
59,060,127
2,500,000
-584,707
1,915,293
60,975,420
38,304,965
18,534,000
9,438,807
66,277,772
2,500,000
-789,430
1,710,570
67,988,342
44,543,339
18,534,000
8,901,096
71,978,435
2,500,000
-633,797
1,866,203
73,844,637
47,527,738
18,534,000
8,104,404
74,166,142
2,500,000
-265,748
2,234,252
76,400,394
48,352,392
18,534,000
6,953,395
73,839,786
2,500,000
34,356
2,534,356
76,374,142
49,506,423
18,534,000
6,949,577
74,990,000
2,500,000
39,945
2,539,945
77,529,945
Source: Secondary Data, 2025 .
Based on the projection of PT Sisirau's Free Cash Flow to the Firm (FCFF) calculation for 10 years, it is seen that the company consistently generates positive free cash flow, which reflects healthy and sustainable financial performance.
The highest FCFF is projected to occur in 2034, which is IDR 77,529,945, while the lowest is in 2025, which is IDR 65,155,961.
The FCFF trend shows a strengthening tendency from year to year, in line with net profit growth, efficiency in working capital management, and the stability of capital expenditure (Cape.
which is relatively constant at IDR 2,500,000 per year.
Cash inflows were primarily supported by significant increases in net income and depreciation and amortization expenses, particularly from 2026 onward.
Furthermore, the interest element .
- .
also contributed positively to increasing operating cash flow.
Meanwhile, cash outflows, consisting of capital expenditure .
and changes in working capital, remained relatively stable.
In some years, such as 2028Ae2032, there was a decrease in working capital .
egative valu.
, which actually increased total FCFF.
FCFF Calculation Projection of PT Satya Agung Table 2.
Projected FCFF Calculation of PT Satya Agung Year Net profit for the year Depreciation & Amortization Interest * .
Cash Inflow
Capex
Changes in Working Capital Cash
Outflow
315,416
25,547,895
29,244,298
55,107,608
2,500,000
15,977,314
18,477,315
73,584,923
22,725,440
33,837,000
29,333,897
85,896,337
2,500,000
169,989
2,669,989
88,566,326
10,824,956
49,166,000
28,810,115
88,801,070
2,500,000
1,576,033
4,076,033
92,877,103
26,065,866
51,606,000
27,889,785
105,561,651
2,500
,000
-1,501,441
998,559
106,560,209
51,532,054
51,606,000
26,505,918
129,643,972
2,500
,000
-2,495,995
4,005
129,647,977
74,871,968
51,606,000
24,544,285
151,022,253
2,500
,000
-2,281,540
218,460
151,240,713
91,798,595
51,606,000
21,933,916
165,338,511
2,500
-1,541,688
958,312
166,296,823
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EQUITY VALUE ANALYSIS WITH THE INCOME APPROACH IN
PALM OIL PLANTATION COMPANIES (CASE STUDY: PT
SISIRAU AND PT SATYA AGUNG)
Alfred Johnson Sianipar et al DOI: https://doi.
org/10.
54443/sibatik.
,000
98,253,200
51,606,000
18,580,224
168,439,424
2,500
,000
-361,995
2,138,005
170,577,429
100,878,131
51,606,000
14,277,798
166,761,929
2,500
,000
176,794
2,676,795
169,438,723
105,188,516
51,606,000
12,077,484
168,872,000
2,500
,000
57,616
2,557,616
171,429,616
Source: Secondary Data, 2025 .
Based on PT Satya Agung's FCFF projection data for the period 2025 to 2034, it is clear that the company is showing very strong financial performance, marked by a consistent increase in FCFF every year.
The highest FCFF value is projected to occur in 2034, amounting to Rp171,429,616, while the lowest value is recorded in 2025, amounting to Rp73,584,923.
Although the initial value in 2025 appears lower than the years after, the figure remains very positive and indicates that from the outset, the company has had excellent liquidity and cash productivity capabilities.
The year-over-year increase in FCFF was primarily driven by significant increases in net income, depreciation, and cash flow efficiency.
Net income rose sharply from only around Rp315,416 in 2025 to over Rp105 million in 2034, reflecting impressive operational performance growth.
Furthermore, stable, high depreciation .
round Rp51 million annually since 2.
has been a key factor in increasing cash inflow without reducing operating profit, as depreciation is a non-cash expense.
Details of PT Sisirau's DCF Calculation Table 3.
Proportion of Equity and Liabilities of PT Sisirau
Equity Debt
Equity Liabilities % Equity % Debt
274,449,796
35,970,447
310,420,243
285,005,910
55,013,772
340,019,682
298,682,366
127,415,176
426,097,543
305,924,697
134,080,860
440,005,557
324,942,467
148,014,454
472,956,921
332,800,201
183,873,156
516,673,357
338,034,932
249,114,472
587,149,404
323,442,059
322,123,424
645,565,483
Year Source: Secondary Data, 2025 .
Table 3 shows that PT Sisirau's equity proportion has consistently decreased from 2017 to 2024, from 88.
4% in 2017 to 50.
1% in 2024.
This means that at the beginning of the period, the company's capital structure was dominated by equity, but over time, there has been a shift towards a balanced mixed capital structure between equity and debt.
This reflects the company's increasing dependence on external financing .
The decline in the equity proportion could also indicate that the company is increasing liabilities more aggressively than its equity growth.
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org/10.
54443/sibatik.
Table 4.
Discount Table and NPV of PT Sisirau Year Equity Debt Cost of Equity (K.
Cost of Debt (K.
WACC
FCFF
Discount
Factor
NPV FCFF
39,608,260
34,218,799
20,190,257
17,509,546
20,920,216
16,128,537
4,102,191
2,774,700
13,054,265
7,772,718
322,023
171,493
3,097,946
1,507,105
271,320
137,165
Total
80,220,063
Source: Secondary Data, 2025 .
Based on table 4, it can be explained that PT Sisirau's Weighted Average Cost of Capital (WACC) shows a downward trend from 15.
75% in 2017 to 12.
04% in 2024.
This decrease is caused by the increasing proportion of debt in the company's capital structure .
ee Table 4.
Because the cost of debt .
21%) is lower than the cost of equity .
88%),
the increase in the proportion of debt automatically lowers the company's WACC.
Furthermore, the NPV value of Free Cash Flow to the Firm (FCFF) after discounting shows significant fluctuations each year.
Over the eight years .
7Ae2.
, the total cumulative NPV is IDR 80,220,063, which represents the estimated total value of the company's FCFF in present value.
Table 5.
Projected WACC Value of PT Sisirau Year Equity Debt Cost of Equity (T.
Cost of Debt (K.
WACC Source: Secondary Data, 2025 .
Table 5 shows that PT Sisirau's projected capital structure for the period 2025 to 2034 shows a consistent composition of 25% equity and 75% debt.
This composition reflects a funding strategy that relies heavily on debt to fund the company's future operations and SIBATIK JOURNAL | VOLUME 4 NO.
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54443/sibatik.
The Cost of Equity (K.
is projected to remain at 16.
88%, while the Cost of Debt (K.
is maintained at 9.
21% throughout the projection period.
With a fixed capital structure and cost of capital.
PT Sisirau's Weighted Average Cost of Capital (WACC) is also projected to remain stable at 9.
61% annually from 2025 to 2034.
Details of PT Satya Agung's DCF Calculation Table 6.
Proportion of Equity and Liabilities of PT Satya Agung
Debt
Equity Liabilities % Equity % Debt
158,932,990
206,110,929
365,043,919
176,275,417
205,234,883
381,510,300
181,884,137
288,840,634
470,724,770
189,295,165
381,286,879
570,582,044
189,869,371
551,300,052
741,169,423
184,766,362
651,197,095
835,963,457
175,116,921
771,837,721
946,954,642
173,111,194
789,405,338
962,516,532
Year Equity Source: Secondary Data, 2025 .
Based on Table 6, it can be explained that during the period 2017 to 2024, the percentage of equity of PT Satya Agung experienced a drastic decline from 43.
5% in 2017 to only 18.
0% in 2024.
This indicates that the company increasingly relies on external funding .
rather than internal funding .
to finance its operational and investment Furthermore, the proportion of debt in the capital structure increases sharply from 5% in 2017 to 82.
0% in 2024.
This reflects that almost all of the company's financing at the end of the period depends on debt.
The company's total equity and liabilities .
increase significantly from IDR 365 billion in 2017 to IDR 962 billion in 2024, indicating growth in the scale of operations.
Table 7.
Discount Table and NPV of PT Satya Agung
Year
Equity Debt
Cost of Equity( T o ) Cost of Debt( K d ) Discount
Factor
NPV FCFF
40% 720,221
646,518
66% 7,298,293
6,539,689
93% 6,746,005
5,482,121
40% 10,995,115
8,171,327
4,716,559
3,260,423
13,634,139
8,728,326
12,005,278
6,817,469
5,668,945
3,393,261
WACC
FCFF
Total Source: Secondary Data, 2025 .
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54443/sibatik.
Based on Table 7, it can be explained that the Weighted Average Cost of Capital (WACC) of PT Satya Agung shows a downward trend from 11.
40% in 2017 to 8.
93% in This decrease occurs along with the increasing proportion of debt in the capital structure .
ee Table 4.
, because the cost of debt is cheaper than the cost of equity and can reduce the average overall cost of capital.
PT Satya Agung's Free Cash Flow to the Firm (FCFF) has fluctuated significantly, reaching a high of Rp 13.
63 billion in 2022 and a low of Rp 720 million in 2017.
However, the overall trend shows an increase in net operating cash flow, reflecting the company's growing operational performance and efficiency over time.
Table 8.
WACC Projection of PT Satya Agung Year Equity Debt Cost of Equity (T.
Cost of Debt (K.
WACC Source: Secondary Data, 2025 .
Based on Table 8.
PT Satya Agung's Weighted Average Cost of Capital (WACC) projection for the period 2025 to 2034 shows a stable value of 9.
61% annually.
This is due to the fixed capital structure composition, with a proportion of equity of 25% and debt of 75%, and the assumption that the Cost of Equity (K.
remains at 16.
88% and the Cost of Debt (K.
21% throughout the period.
This financing structure reflects PT Satya Agung's continued high-leverage strategy, predominantly funded through debt.
While this structure lowers the WACC .
ecause the cost of debt is lower than the cost of equit.
, it also implies increased financial risk that must be carefully managed, particularly in light of fluctuations in revenue and debt interest Table 9.
Revenue History Year
PT Sisirau
Growth
PT Satya Agung
Growth
326,786,401
322,308,035
29,497,769
26,468,140
233,666,747
274,711,601
467,282,227
421,810,611
24,927,703
28,353,771
129,226,875
241,349,102
SIBATIK JOURNAL | VOLUME 4 NO.
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php/SIBATIK EQUITY VALUE ANALYSIS WITH THE INCOME APPROACH IN PALM OIL PLANTATION COMPANIES (CASE STUDY: PT SISIRAU AND PT SATYA AGUNG) Alfred Johnson Sianipar et al DOI: https://doi.
org/10.
54443/sibatik.
292,925,111
294,025,265
Average 329,189,500 Source: Secondary Data, 2025 .
235,619,455 266,799,373 122,780,274 Based on historical revenue for the period 2017 to 2024.
PT Sisirau showed an average annual revenue of Rp329,189,500, which is significantly higher than PT Satya Agung which recorded an average revenue of Rp122,780,274.
This indicates that PT Sisirau has a larger business scale and more stable sales volume overall.
However.
PT Sisirau experienced quite sharp revenue fluctuations from year to year, including significant declines in 2019 and Meanwhile, although PT Satya Agung's revenue value is still lower, this company showed a very high average annual growth of 64.
4%, far exceeding PT Sisirau which was Table 10.
Projection Calculation Results Year
PT Sisirau
451,133,000
458,106,000
464,558,000
464,737,000
465,744,000
465,047,000
464,246,000
463,398,000
PT Satya Agung
451,133,000
458,106,000
464,558,000
464,737,000
465,744,000
465,047,000
464,246,000
463,398,000
463,398,000
463,398,000
Source: Secondary Data, 2025 .
463,398,000 463,398,000 This revenue projection is used as the basis for calculating future cash flows using the DCF approach.
The assumed growth reflects conservatism and takes into account the palm oil plantation life cycle, market risks, and production capacity.
The year-over-year decline in growth also reflects a conservative approach to long-term projections.
Table 11.
Comparison of Income of PT Sisirau and PT Satya Agung Indicator Total Present Value (Rp Thousan.
Cash ( ) PT Sisirau
PT Satya Agung
512,606,528
1,245,991,172
926,898,621
3,007,578,305
Bank debt Leasing debt Post-employment benefit debt ,486,.
17,658
,338,.
,486,.
1,665,789,973
3,848,037,335
Indicated Value of 100% equity (Rp Thousan.
Source: Secondary Data, 2025 .
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org/10.
54443/sibatik.
Based on Table 11, it can be seen that PT Satya Agung has a significantly greater financial performance than PT Sisirau, both in terms of total present value, available cash, and the company's equity indication value.
In terms of Total Present Value (TPV).
PT Satya Agung recorded a value of Rp926.
billion, nearly double that of PT Sisirau, which was Rp512.
61 billion.
This difference indicates that PT Satya Agung's future cash flow generation is significantly greater, reflecting more promising business prospects and profitability.
Meanwhile.
PT Satya Agung's cash position is also significantly stronger, at Rp3.
trillion, compared to Rp1.
25 trillion at PT Sisirau.
This substantial cash availability provides significant flexibility for operations and business expansion.
RESULTS AND DISCUSSION
Valuation Analysis with Income Approach Company value assessment using the Income approach, specifically the Discounted Cash Flow (DCF) method, provides a comprehensive overview of an entity's potential economic value based on projected future cash flows discounted to their present value.
this study, the DCF method was used to evaluate the equity value of two palm oil plantation companies.
PT Sisirau and PT Satya Agung.
The Free Cash Flow to the Firm (FCFF) projection shows that PT Satya Agung consistently generates a higher FCFF value than PT Sisirau throughout the projection period from 2025 to 2034.
In the initial projection year .
PT Sisirau's FCFF value was recorded at IDR 65.
16 million, while PT Satya Agung reached IDR 73.
58 million.
This difference continues to increase, until in 2034.
PT Satya Agung's FCFF reaches IDR 171.
million, more than double PT Sisirau's FCFF which is only IDR 77.
53 million.
Capital Structure and Its Impact on WACC A company's capital structure plays a crucial role in determining the Weighted Average Cost of Capital (WACC), which is the discount factor in the DCF method.
WACC
reflects the average cost of all of a company's funding sources, both debt and equity, adjusted for their proportion in the capital structure.
PT Sisirau exhibited a relatively balanced capital structure, with equity at 50.
1% and debt at 49.
9% at the end of 2024.
In 2017, its equity reached 88.
4%, indicating that the company initially relied heavily on equity funding.
However, significant structural changes have occurred over time, reflecting a shift in its financing strategy toward external funding.
Interpretation of Equity Value Based on DCF The equity value calculation using the DCF method yields a cumulative Net Present Value (NPV) of FCFF of Rp80.
22 billion for PT Sisirau and Rp43.
04 billion for PT Satya Agung.
This figure indicates that, based on net operating cash flows discounted at their respective WACCs.
PT Sisirau provides greater economic added value.
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54443/sibatik.
However, when considering all elements of equity valuation, including available cash and the company's liabilities, the final result reveals a different picture.
The total present value of PT Satya Agung's assets is recorded at IDR 926.
90 billion, significantly higher than PT Sisirau's IDR 512.
61 billion.
PT Satya Agung's cash holdings are also significantly larger (IDR 3.
01 trillio.
than PT Sisirau's (IDR 1.
25 trillio.
Revenue Growth and Business Scale In terms of historical revenue .
7Ae2.
PT Sisirau recorded an average annual revenue of Rp329.
19 million, significantly higher than PT Satya Agung's Rp122.
78 million.
This indicates that PT Sisirau has a larger business scale and is well established in its However.
PT Sisirau's revenue growth is relatively low, at only 2.
70% per year.
There have even been significant revenue fluctuations, particularly in 2019 and 2023.
This indicates market instability or challenges that have not been addressed with an appropriate growth strategy.
IPO Feasibility Evaluation Considering all aspects of FCFF.
WACC, equity value, capital structure, cash position, and growth trends, it can be concluded that PT Satya Agung has more ideal characteristics for carrying out an Initial Public Offering (IPO).
CLOSING
Conclusion Based on the results of the analysis of the valuation of the companies PT Sisirau and PT Satya Agung using two main approaches, namely the income approach, the following conclusions can be drawn:
The income statement for PT Sisirau and PT Satya Agung was calculated using the Discounted Cash Flow (DCF) method by calculating FCFF and discounting it using their respective WACC.
As a result.
PT Sisirau has a higher FCFF NPV (Rp80.
22 billio.
, but PT Satya Agung's equity value is higher (Rp3.
85 trillio.
due to its significantly stronger cash position and high performance growth.
Based on the valuation and financial analysis.
PT Satya Agung is more suitable for an Initial Public Offering (IPO) due to its higher equity valuation, high revenue growth, and more promising financial projections compared to PT Sisirau.
Several key indicators supporting PT Satya Agung's suitability are:
Significant Equity Valuation PT Satya Agung's equity value reached Rp3.
85 trillion, nearly double that of PT Sisirau.
This reflects the company's strong financial position and attractiveness to public investors.
Very High Revenue Growth PT Satya Agung has recorded an aggressive revenue growth trend, which is a strong signal of attractive return potential for medium- and long-term investors.
Excellent Liquidity SIBATIK JOURNAL | VOLUME 4 NO.
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With a cash position of over Rp3 trillion, the company has high flexibility in meeting operational needs, paying short-term liabilities, and funding post-IPO expansion without liquidity pressure.
Low WACC PT Satya Agung's Weighted Average Cost of Capital (WACC) level is relatively low, so that capital cost efficiency can support investment financing and increase the company's value after going public.
PT Sisirau is not yet eligible for an IPO because:
At the peak of the projection in 2034.
PT Sisirau's FCFF only reached IDR 77.
5 billion, a relatively small figure compared to the capital requirements and investor expectations for a company ready to go public.
In terms of valuation, although PT Sisirau recorded a total NPV of FCFF of Rp80.
billion, the company's equity value is only around Rp1.
67 trillion.
Cash availability is also limited, at Rp1.
25 trillion, indicating that the company does not yet have sufficient cash reserves to support aggressive expansion or post-IPO liquidity.
Furthermore.
PT Sisirau's liability structure is less than ideal due to a substantial post-employment benefit debt burden of Rp7.
34 billion, plus the existence of leasing debt, which could hinder the company's financial flexibility in the future.
Suggestion Based on the results of the research that has been conducted, the researcher provides several suggestions that are expected to be input for companies and related parties in the process of assessing equity value and IPO plans:
For PT Satya Agung Given that the Discounted Cash Flow valuation results indicate a high equity value and strong cash flow projections.
PT Satya Agung is advised to immediately prepare for an IPO with a transparent, data-driven valuation strategy.
The company should also strengthen financial communications with potential investors by preparing a prospectus that details cash flow projections, growth assumptions, and expansion strategies.
Furthermore.
PT Satya Agung needs to maintain operational efficiency and cash management to ensure consistent growth leading up to and after the IPO.
For PT Sisirau The valuation results indicate that although PT Sisirau has the potential for stable cash flow, its equity value still lags behind that of PT Satya Agung.
Therefore.
PT Sisirau is advised to postpone its IPO plans until the company has significantly improved its financial performance.
The company can first focus on optimizing land productivity, operational cost efficiency, and strengthening its cash position.
Furthermore, improvements to its capital structure and diversification of revenue sources are also important to strengthen future free cash flow.
For Appraisers SIBATIK JOURNAL | VOLUME 4 NO.
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It is recommended that appraisals rely on more than one approach, but rather combine the cash flow method (DCF/FCFF), the market approach, and the asset-based approach.
This provides a more comprehensive picture of the company's actual fair value than simply looking at the current asset value.
It is recommended to conduct a sensitivity analysis on key variables .
iscount rate/WACC, revenue projections, and profit margin.
This helps assess how changes in assumptions affect the company's value and provides more reliable decision-making guidance.
REFERENCES