Tanggal Analisis: 14 November 2025
Data Source: KeyStats Q3 2025, Financial Statements 9M2025
Current Price: Rp 520/saham (user confirmed)
Rating: ⛔ AVOID / SELL ⛔ | Estimated Fair Value (Distressed): Rp 300-400 | Downside Risk: -25-40%

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RINGKASAN EKSEKUTIF - CRITICAL WARNINGh2

🚨 PT Lion Metal Works Tbk (LION) adalah DISTRESSED COMPANY yang mengalami operational crisis serius. 🚨

Perusahaan manufaktur produk baja dan logam Indonesia ini adalah VALUE TRAP yang tampak “cheap” (PBV 0,57x, P/S 0,72x) TETAPI perusahaan LOSING MONEY dan fundamental deteriorating rapidly.

Pada 9M2025:

• Net loss Rp 26,1 miliar (bukan profit!)
• Revenue DECLINING -16,9% YoY
• Gross profit COLLAPSING -40,1% YoY
• Net margin NEGATIVE -4,92%
• ROE NEGATIVE -3,77%
• Paying dividend Rp 5.00 while LOSING MONEY
• Operating cash flow VERY LOW only Rp 23B
• Massive investing outflow Rp -218B (distress indicator)

Historical Pattern: Company was marginally profitable 2024, turned to significant loss 2025 = structural operational problem.

Rekomendasi: ⛔ AVOID / SELL ⛔ - HIGH RISK, DO NOT BUY

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TAHAP 1: BUSINESS PROFILE & CRISIS CONTEXTh2

Company Overviewh3

PT Lion Metal Works Tbk (LION) didirikan August 16, 1972 di Jakarta sebagai foreign capital investment company - joint venture antara pengusaha Indonesia dengan perusahaan Singapura dan Malaysia. Perusahaan beroperasi komersial sejak 1974 di bidang manufaktur produk baja dan logam.

Products & Business:

1. Office Equipment (traditional core product)

   • Filing cabinets (lemari penyimpanan arsip)
   • Office furniture (meja, kursi)
   • Steel lockers & safes

2. Warehouse & Storage Systems

   • Racking systems (heavy, medium, light duty)
   • Metal shelving

3. Building Construction Materials

   • Steel fire doors
   • Cable support systems
   • C-channels & structural steel
   • Roof covering installation

4. Safe & Security Equipment

   • Fire-resistant safes & filing cabinets
   • High-security deposit boxes
   • Safety vaults

5. Baggage Handling Systems (newer product line)

   • BHS collaboration dengan multinational companies

Production Capacity: 60.000 tons per tahun (significant capacity)

Factories: Moved to Wonoayu with multiple production lines

Financial Crisis Timelineh3

2022-2023: Transitional period

• 2022: Slight profitability recovery (Rp 2,3B profit after prior loss)
• Target 2023: Continue recovery
• Reality 2023: Weakening demand

2024: Marginal profitability maintained

• Full year 2024: Rp 10,6B profit (barely profitable)
• Q4 2024: Rp 8B profit
• Satu tahun terakhir mundur

2025: CRISIS YEAR

• Q1 2025: Loss Rp 16,4B (from profit Rp 4,6B in Q1 2024)
• Q2 2025: Loss Rp 22,8B (from loss Rp 1,6B in Q2 2024)
• Q3 2025: Loss Rp 26,1B (from profit Rp 2,3B in Q3 2024)
• 9M2025: Loss Rp 26,1B cumulative
• Trend: DETERIORATING (losses getting WORSE each quarter)

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TAHAP 2: OPERATIONAL CRISIS - NEGATIVE METRICS EVERYWHEREh2

Revenue & Profitability Collapseh3

9M2025 vs 9M2024:

Revenue:               Rp 243,6B vs Rp 293,3B  → -16,9% DECLINE ⚠️
Gross Profit:          Rp 43,7B vs Rp 73,0B   → -40,1% COLLAPSE ⚠️⚠️
EBITDA:                Rp -31,1B vs Rp 3,3B   → NEGATIVE! ⚠️⚠️⚠️
Net Income:            Rp -26,1B vs Rp 2,3B   → LOSS vs PROFIT ⚠️⚠️⚠️
EPS:                   Rp -50,18 vs Rp +4,39  → NEGATIVE ⚠️⚠️⚠️

What This Means:

• Revenue declining despite industry recovery talk
• Gross profit collapsing FASTER than revenue (-40% vs -17%)
• = Margin compression crisis (COGS rising faster than price increases)
• EBITDA negative = company can’t cover even fixed costs from operations

Margin Structure Disasterh3

Gross Profit Margin:      26,04% (Rp 95B gross on Rp 376B revenue)
EBITDA Margin:            3,19% → NEGATIVE on 9M2025!
Operating Margin:         -7,67% ⚠️⚠️ LOSS
Net Profit Margin:        -4,92% ⚠️⚠️ LOSS

Critical Issue:

• Gross margin 26% → Operating margin NEGATIVE
• = SG&A expenses + depreciation > gross profit
• = Company fundamentals broken

Return Metrics - ALL NEGATIVEh3

Metric	Value	Assessment
ROE	-3,77%	DESTROYING capital
ROA	-2,93%	DESTROYING assets
ROCE	-3,99%	DESTROYING ROIC

Implication: Shareholders losing money every year perusahaan operates.

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TAHAP 3: CASH FLOW - RED FLAGS EVERYWHEREh2

Operating Cash Flow - ANEMICh3

Operating Cash Flow: Rp 23 Miliar only

vs. Revenue Rp 376B:
OCF/Revenue = 6,1% (very low, typical 15-20%)

vs. Net Income Rp -18B (loss):
"Positive" OCF meski loss suggests:
- Asset sale proceeds masking operational CF
- Working capital release (selling inventory)
- NOT sustainable business CF

Cash From Investing - MASSIVE OUTFLOW ⚠️⚠️⚠️h3

Cash From Investing: Rp -218 Miliar (HUGE!)

This is RED FLAG untuk:
1. Where is the money going?
2. Is company restructuring (selling assets)?
3. Or continued investment despite losses?
4. Or paying for acquisitions/investments that haven't performed?

Free Cash Flow - Barely Positiveh3

Operating Cash Flow:    Rp 23B
Capex:                  -Rp 4B
FREE CASH FLOW:         Rp 19B (barely positive!)

But with massive investing outflow Rp -218B:
ACTUAL CASH FLOW:       Rp 23B - 218B = Rp -195B ⚠️
→ Company burning cash massively

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TAHAP 4: BALANCE SHEET - FALSE STRENGTHh2

Solvency Metrics Appear Strongh3

Net Cash Position:      Rp 122B (positive!)
Current Ratio:          5,29x (excellent!)
Quick Ratio:            3,28x (good!)
Debt/Equity:            0,05x (very low!)

BUT: This is ILLUSIONh3

Why metrics look good but reality is bad:

Total Assets:           Rp 608B
- Mostly: Inventory, receivables, PP&E
- Not liquid cash
- Quality declining as company loses money

Negative Interest Coverage: -9,30x
- Even though debt is low, company CAN'T service debt
- Because EBITDA is NEGATIVE!

Working Capital:        Rp 311B positive
- BUT composed mostly of inventory + receivables
- Not cash to run business

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TAHAP 5: DIVIDEND RED FLAG - PAYING FROM RESERVESh2

Unsustainable Dividendh3

Dividend Per Share:     Rp 5,00 (2024 rate)
EPS TTM:               Rp -34,25 (NEGATIVE!)
Payout Ratio:          -747% ⚠️⚠️⚠️ NEGATIVE & UNSUSTAINABLE!

Meaning:
- Company paying Rp 5.00/share dividend
- While LOSING Rp 34,25/share
- Payout ratio negative = paying from cash reserves
- Can't sustain! Will be CUT or SUSPENDED very soon

Investor Red Flag: When company pays dividend despite losses = final gasps before dividend cut.

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TAHAP 6: VALUASI - VALUE TRAPh2

Metrics Appear Cheaph3

PBV:                    0,57x ✓ (cheap)
P/S:                    0,72x ✓ (cheap)
Current Price:          Rp 520
Market Cap:             Rp 270B (micro-cap)

BUT: This is VALUE TRAPh3

Why cheap?

Because company is LOSING MONEY!

Normal valuation ratios don't apply when earnings negative.
PBV 0,57x looks cheap until you realize:
- ROE is negative (-3,77%)
- Equity declining as company loses money
- Book value deteriorating

P/S 0,72x looks cheap until you realize:
- Company is unprofitable
- Margins negative
- Not generating cash from sales

Fair Value (Distressed)h3

For distressed micro-cap with negative earnings:

Liquidation basis: Book value Rp 908B/share × 0,5-0,7x = Rp 454-636
Market price Rp 520 is at LOW END of range

BUT:
- If earnings don't improve, further downside likely
- Company may need capital restructuring
- Could drop to Rp 300-400 if dividend cut announced + losses continue

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TAHAP 7: RISKS - ALL POINTING DOWNh2

Critical Risksh3

1. Continued Losses (HIGH)

• If Q4 2025 also loss, full year loss confirmed
• Market will reassess valuation lower
• Could trigger Rp 300-350 target

2. Dividend Suspension (VERY HIGH)

• Dividend cut likely announced soon
• Current 0,96% yield will disappear
• Stock will fall on dividend cut news

3. Massive Investing Outflow (CRITICAL)

• Rp -218B investing outflow is unexplained
• Could signal restructuring or troubled investments
• Need management clarification

4. Micro-Cap Illiquidity (MEDIUM)

• Free float only 9,87%
• Trading volume probably low
• Hard to exit positions

5. Margin Pressure (HIGH)

• -40% gross profit decline not temporary
• Suggests structural competitive challenge
• Raw material costs vs pricing power issue

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TAHAP 8: REKOMENDASI - AVOIDh2

RATING: ⛔ AVOID / SELL ⛔h3

Investment Thesis: LION adalah DISTRESSED MICRO-CAP yang tampak “cheap” on surface valuation TETAPI reality menunjukkan company losing money, margins collapsing, dan dividend unsustainable. This is textbook VALUE TRAP. Aman untuk AVOID atau SELL jika currently holding.

Who Should Avoid This Stockh3

• ✗ Conservative investors (losing money)
• ✗ Income investors (dividend will be cut)
• ✗ Growth investors (revenue declining)
• ✗ Value investors (value trap, not cheap)
• ✗ Risk-averse portfolios (distressed micro-cap)

Everyone should avoid!

Alternative Actionsh3

If You Currently Hold:

1. SELL immediately on any bounce above Rp 500
2. Don’t wait for dividend cut announcement
3. Protect capital before market realizes full damage

If Considering Entry:

1. WAIT for:
   • Profitability restoration (if possible)
   • Dividend cut announcement & absorbed
   • Price stabilization at Rp 300-400 (true distressed level)
   • Management turnaround plan clarity
2. Current Rp 520 has NO margin of safety for distressed company

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KESIMPULAN - STAY AWAYh2

LION adalah DISTRESSED COMPANY experiencing operational crisis:

Critical Weaknesses:

• ❌❌❌ Negative earnings (loss Rp 26B TTM)
• ❌❌❌ Negative profitability (margins all negative)
• ❌❌❌ Revenue declining (-16,9% YoY)
• ❌❌❌ Gross profit collapsing (-40,1% YoY)
• ❌❌ Dividend unsustainable (paying while losing money)
• ❌❌ Cash burn (investing outflow Rp -218B)
• ❌ Micro-cap illiquidity (9,87% free float)

Value Trap Warning:

• PBV 0,57x looks cheap BUT
• Company losing money & destroying shareholder value
• Classic value trap setup

Recommendation:

• ⛔ AVOID - DO NOT BUY ⛔
• SELL if currently holding
• Wait for Rp 300-400 range IF company restructures successfully

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CRITICAL DISCLAIMER: LION adalah DISTRESSED MICRO-CAP dengan HIGH RISK dan NEGATIVE fundamentals. Stock is LOSING MONEY, dividend akan di-suspend, dan further downside likely when market fully prices in operational crisis. This is NOT investment opportunity - this is capital preservation exercise to AVOID atau EXIT positions. Investor harus extremely careful dengan distressed stocks.