The Asset Floor

The Asset Floor

The margin-of-safety case leans on a book-value floor of Rp204 a share. This chapter tests whether that floor is solid. It is real — the assets are genuine, insured, non-impaired trucks and land, carried under the cost model with no revaluation gloss. But the fleet is carried at roughly what it fetches when sold, not below it, and vehicles and land alike are pledged to the lenders. The equity's protection is an ordinary residual behind secured debt, not a deep-discount asset play.

The balance sheet is a pile of trucks and land

Graha Trans is, on the asset side, almost entirely fixed assets. Net fixed assets were Rp956.1bn at end-2025, up from Rp795.4bn a year earlier, and that single line is 77% of the Rp1,242.8bn balance sheet and 99.9% of all non-current assets — deferred tax and other long-term items together are under Rp0.8bn [1]. The rest is working capital: receivables, inventory, and Rp19.7bn of cash [2]. There is no goodwill and no intangible line of any size. What a buyer of the equity owns, in substance, is a fleet and some land.

Fixed assets net Rp956.1bn and total assets Rp1,242.8bn from the consolidated statement of financial position [3]; total equity Rp386.6bn (Rp386.3bn attributable to owners, Rp204/share on 1,894,375,000 shares) [4].

Within that net fixed-asset figure, three classes dominate the gross carrying cost: vehicles at Rp694.9bn (direct-ownership trucks, before the separately-held leased fleet), land at Rp181.9bn, and buildings and infrastructure at Rp61.7bn [5]. The fleet is the engine of the business Financing the Fleet analysed on the funding side; here the question is what it is worth.

How the fleet is carried, and why that matters

Two accounting choices decide whether the Rp204 of book is conservative or generous. First, the group uses the cost model, not revaluation — so nothing on the balance sheet has been marked up to appraisal value, and reported book carries no revaluation surplus that could reverse [6]. Second, trucks are depreciated on a units-of-production method over an estimated life of 300,000 to 900,000 kilometres, while buildings and equipment run straight-line and land is not depreciated at all [7].

Usage-based depreciation is the economically honest choice for a haulier: a truck's value falls with kilometres driven, not with the calendar, so the carrying value tracks wear rather than an arbitrary time schedule. The FY2025 depreciation charge was Rp44.8bn, most of it (Rp40.6bn) inside cost of revenues [8]. Management recorded no impairment indicators on any fixed asset at year-end, and the fleet is insured against all risks for Rp648.9bn — comfortably above its carrying value, which is the right direction for an asset a lender is relying on [9]. None of this is aggressive. If anything, the policy set biases carrying value toward realism.

The disposal test: carried at fair value, not below it

The strongest evidence on whether book value is a real number comes from what happens when Graha Trans actually sells trucks — and it sells a lot of them. In FY2025 it disposed of trucks that had originally cost Rp148.1bn and were only 35% depreciated (accumulated depreciation of Rp52.2bn), leaving a net book value of Rp95.9bn, and collected Rp97.1bn in proceeds [10]. The gain over book was Rp1.2bn — 1.3%. The prior year told the same story: Rp25.1bn of book sold for Rp26.1bn, a 4.0% gain [11].

Details of the sale of fixed assets, Note 8: original cost, accumulated depreciation, net book value and proceeds; gain over book is proceeds less net book value (1.3% in FY2025, 4.0% in FY2024) [12].

This cuts two ways, and both matter for the reader. The good news is that book value is not fiction: trucks realise essentially their carrying amount in an orderly market, so the depreciation schedule is neither too fast nor too slow, and the Rp204 of book is backed by assets that fetch about Rp204. The caution is the flip side of the same fact — the fleet is carried at fair value, not below it. Earlier chapters described the trucks as "recycling at a gain"; that is technically true, but the gain is one to four percent, an orderly-market spread, not a hidden discount waiting to be unlocked. There is no deep pool of understated fleet value here for an asset-play buyer to capture.

Two further details confirm the fleet is run tight rather than milked. Fully-depreciated assets still in use total only Rp5.2bn of gross cost — the company sells trucks while they still have book value rather than running them to zero and hiding value off the depreciation schedule [13]. And the churn is heavy: against Rp148.1bn of trucks sold at cost, Graha Trans bought Rp255.8bn of new vehicles, all from third parties [14] [15]. The fleet grew, but it is a treadmill: capital must keep going in to keep the asset base current.

Vehicle additions Rp255.8bn and original cost of vehicles disposed from Note 8; disposals are the Rp148.1bn cost line from the sale-of-fixed-assets table [16] [17].

Land at cost

If there is hidden value in the assets, it is the land. Rp181.9bn of land sits on the balance sheet at historical cost, never revalued and never depreciated [18] [19]. Indonesian land held for years is often carried well below market, so cost accounting could understate the true worth of these truck pools and yards — Rp181.9bn is nearly half of book equity, so even a modest appreciation would matter. But the honest position is that the corpus contains no independent appraisal, so this is a possibility, not a proven cushion; nothing in the filings lets the market value be pinned. Land is the asset line that could hold value above its carrying cost, and the disclosures do not quantify by how much.

The floor protects lenders first

The decisive limitation is who has first claim on all of this. Fixed assets — "vehicles and land" — are pledged as collateral for the bank loans, the long-term musyarakah financing and the financing payables [20]. The Rp956.1bn of fixed assets stands behind Rp856.3bn of total liabilities, of which the great majority is secured interest-bearing debt [21]. Book equity is the Rp386.6bn residual — 31% of assets — that remains after the lenders are made whole [22].

That ordering is why the "asset floor" comforts a bond more than a share. The 1.3% disposal premium was earned selling roadworthy trucks one at a time into a functioning used market; a forced sale of a whole pledged fleet by a lender enforcing security would not clear book, and the equity sits behind that security. For a reader whose first fear is a holding going to zero, the genuine protection against bankruptcy is not the asset cushion but the cash flow that services the debt — operating cash covering interest 2.4x, as Financing the Fleet set out. The trucks keep the lenders safe; it is the earnings that keep the equity safe.

What this means, and what would change it

Asset quality is genuinely decent: real, insured, third-party-bought, non-impaired trucks depreciated on a rational usage basis and carried at about what they realise, plus land at cost. So the Rp204 book value is a real going-concern floor, not an accounting mirage — which is worth something to a buyer paying 1.2x book Valuation and Estimates. But it is not the deep-discount asset play the profile prizes: the fleet holds no hidden markdown, the whole asset base is pledged ahead of the equity, and the one line that might understate value — land at cost — cannot be sized from the filings. The margin of safety in the assets is ordinary, not large.

Two things would change this read. A land appraisal materially above the Rp181.9bn carrying cost would convert an unquantified possibility into a genuine cushion and widen the floor. Conversely, a break in the FY2026 finance bill or the customer book that forced disposals under pressure would test whether trucks still fetch book when the seller is not a willing one — the first live read on that lands with the H1 FY2026 statements.