PT. Vale Indonesia Tbk (INCO) Solid Operational Discipline and Substantial Margin Expansion in 1H26 Key Takeaways: - Surging Nickel Ore Contribution. The Nickel Ore segment exhibited explosive growth, with 1H26 revenue skyrocketing by 2840% y/y to USD 142 mn, driven by robust sales volumes. - Resilient Cost Structure. Despite rising global energy prices for HSFO, diesel, and coal, the 2Q26 cash cost for nickel matte improved to USD 10,005 per ton, reflecting strict cost discipline and operational efficiency. - Solid Operational Execution. Reached 29,773 tons of nickel matte production, driven by the completion of the Electric Furnace 3 Rebuild project in June 2026 Recommendation: "BUY” We maintain our BUY recommendation based on our EV/EBITDA-based valuation. Applying a target multiple of 7.9x to our base amount of USD 481 mn, we arrive at a 12-month target price of IDR 6,300. This presents a compelling 15.60% upside potential from the last close of IDR 5,450 (as of 6 Aug 26). Valuations reflect the growth pipeline, trading at a 2026F EV/EBITDA of 7.7x and a 2026F P/E of 14.60x. Downside risks include: 1) Geopolitical situations impacting global energy markets; 2) Upward trends in energy costs such as HSFO, diesel, and coal; 3) Weaker nickel price. Adrian Djie Equity Research KIWOOM SEKURITAS INDONESIA