ACES Stock: Thriving Amidst Weak Spending and Intense Competition

JAKARTA – Faced with the dual challenges of weakening purchasing power and escalating competition within the retail sector, Mirae Asset Sekuritas Indonesia has adjusted its price target for shares of PT Aspirasi Hidup Indonesia Tbk. (ACES).

Despite these headwinds, ACES reported a modest 3.24% year-on-year (YoY) increase in sales, reaching Rp4.26 trillion in the first half of 2025, up from Rp4.13 trillion during the same period in 2024. This growth was largely broad-based across nearly all product segments. The home improvement segment, a core offering, recorded sales of Rp2.19 trillion in H1 2025, an increase from Rp2.14 trillion in H1 2024. Similarly, the lifestyle product segment contributed Rp1.88 trillion, while the gaming products segment generated Rp190.10 billion in sales between January and June 2025.

However, the positive sales figures were overshadowed by a significant decline in profitability. ACES’s net profit for the first half of 2025 fell by 19.92% YoY to Rp292.86 billion, compared to Rp365.76 billion in the corresponding period of the previous year.

Abyan Habib Yuntoharjo, an analyst at Mirae Asset Sekuritas, elucidated that the company’s sales growth in the first half of 2025 was primarily propelled by the expansion of new stores, which alone contributed approximately 6% to the overall revenue. This expansion, however, masked a more concerning trend: ACES’s same-store sales growth (SSSG) remained negative at 2.9%.

Furthermore, operational expenses at ACES surged at a faster pace than its sales during the first half of 2025. This rapid increase in costs, largely attributed to the aggressive store expansion strategy, led to a substantial 35.5% YoY drop in operating profit, which settled at Rp259 billion for the period. In a research note published on Tuesday, August 19, 2025, Abyan highlighted that “cost pressures stemmed from rent, salaries, distribution, and A&P, although these were partially mitigated by other operational income.”

Looking ahead, Abyan predicts that ACES’s earnings per share (EPS) for 2025 will shrink by 21.8%, primarily due to the weakening SSSG and a projected gross margin of 45-46%. Nevertheless, the company’s revenue growth is expected to be sustained by the planned opening of 25–30 new stores this year, even with 17–19 store closures factored in.

During an earnings call with Mirae Asset, ACES’s management, under the AZKO brand, disclosed plans to intensify store additions in second and third-tier cities. Conversely, store closures are slated for the Jakarta area, targeting unproductive outlets. ACES has also revised its full-year 2025 revenue guidance. Initially targeting a “mid-single digit” growth, the company has now adjusted its projection to “mid to low single digit” for 2025, aligning with the current 3.24% revenue growth.

Adding to the competitive pressures, the anticipated return of Ace Hardware to Indonesia through the MAP Group is perceived as a significant threat to ACES’s market position in the domestic retail landscape. Considering these factors—the weak H1 2025 results, the cautious outlook, persistent sluggish demand, and intensifying competition from players like MDIY, Ace US (via MAP Group), and e-commerce imports—Mirae Asset has downgraded its recommendation for ACES. Despite the cautionary stance, the firm has issued a “trading buy” recommendation for ACES shares, setting a price target of Rp550 per share. This target implies a potential upside of 20.61% from the current share price of Rp456.

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