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Sh ift in g pa r a digm
M a r k e t ing sa le s t o be d om ina t e d b y r e side n t ia l pr oj e ct s
LPCK has confirm ed a planned shift in it s m ar ket ing sales focus, m oving from indust r ial land t o r esident ial sales, including sales from apar t m ent s and landed house pr oj ect s. This is t o incr ease landbank efficiency , w hich is below all indust rial peers under our coverage ( Exhibit 8) . Based on LPCK’s 1Q13 m ar ket ing sales, resident ial proj ect s dom inat e it s por t folio, wit h 66: 34 split landed house under t akings, launching 2 new proj ect s in 2Q13 wit h pot ent ial com bined sold- out sales v alue of I DR285b. Given t hese proj ect launches, w e houses, apart m ent s and ot her support ing facilit ies, such as schools and ent er t ainm ent cent er s, along wit h r ent al office and com m er cial infrast ruct ure, m eant t o raise LPCK’s r ecur ring incom e ahead. Cur rent m aj or recurring incom es st em fr om r ecent ly- est ablised 5.3ha Japanese SME cent er ( 1Q13) , m ost ly rent ed out t o com ponent - r elat ed Japanese com panies wit h ARR of I DR90k/ sqm / m ont h. Alt hough LCCC w ill not be com plet ed unt il 2020, LPCK sales from t he proj ect will begin cont ribut ing in 2014. More det ails will em er ge, w hen LPCK officially unveils it s m ast er plan t o t he public in 2H13.
M or e la n d e fficie n t ; Re - it e r a t e BUY w it h I D R9 ,3 0 0 TP
Salm an Faj ar i Alam sy ah ( salm an@bahana.co.id) + 6221 2505081 ext . 3605 Lippo Cik a r a ng
Ye a r t o 3 1 D e ce m be r 2 0 1 1 2 0 1 2 2 0 1 3 F 2 0 1 4 F 2 0 1 5 F
PROFI T & LOSS ( I D Rb)
Sa le s 9 0 2 1 ,0 1 3 1 ,2 0 7 1 ,5 1 5 1 ,8 2 9 Gr oss pr ofit 3 8 8 5 2 0 6 4 4 7 9 5 9 5 0
EBI TD A 3 1 1 4 4 1 5 5 4 6 8 1 8 1 3
Depr eciat ion 7 4 7 8 9
EBI T 3 0 4 4 3 7 5 4 7 6 7 3 8 0 4
Net int er est inc./ ( expense) ( 13) 4 16 24 34
Forex gain/ ( losses) ( 0) 2 - - -
Ot her incom e/ ( ex pense) 11 15 17 19 22
Pr e - t a x pr ofit 3 0 1 4 5 8 5 8 0 7 1 6 8 6 0
Taxes ( 44) ( 51) ( 60) ( 76) ( 91)
Minor it y int er est - - -
Ext raordinary gain/ ( losses) - - - - -
N e t pr ofit 2 5 7 4 0 7 5 2 0 6 4 1 7 6 9
BALAN CE SH EET ( I D Rb)
Cash and equiv alent s 37 310 581 783 1,153
S- T invest m ent s - - -
Trade r eceiv ables 73 54 83 106 122
I nv ent or ies 1,359 1, 940 2, 367 2,721 3,075
Fix ed asset s 51 48 57 69 75
Ot her asset s 522 480 586 775 947
Tot a l a sse t s 2 ,0 4 2 2 ,8 3 2 3 ,6 7 2 4 ,4 5 4 5 ,3 7 2
I nt erest bear ing liabilit ies 140 - - - -
Trade pay ables 204 0 2 2 2
Ot her liabilit ies 877 1, 604 1, 922 2,064 2,212
Tot a l lia bilit ie s 1 ,2 2 1 1 ,6 0 4 1 ,9 2 4 2 ,0 6 6 2 ,2 1 4
M in or it y in t e r e st - - - - -
Sh a r e h olde r s' e qu it y 8 2 1 1 ,2 2 8 1 ,7 4 8 2 ,3 8 9 3 ,1 5 8
CASH FLOW ( I D Rb)
EBI T 304 437 547 673 804
Depr eciat ion 7 4 7 8 9
Wor k ing capit al ( 366) ( 772) ( 443) ( 372) ( 363)
Ot her operat ing it em s 256 632 223 35 56
Ope r a t in g ca sh flow 2 0 0 3 0 1 3 3 4 3 4 3 5 0 6
Net capit al expendit ur e ( 321) ( 469) ( 490) ( 496) ( 490)
Fr e e ca sh flow ( 1 2 1 ) ( 1 6 7 ) ( 1 5 7 ) ( 1 5 3 ) 1 6
Equit y raised/ ( bought ) - - -
Net borrow ings 140 ( 140) - - -
Ot her financing ( 18) 580 427 355 354
N e t ca sh flow 1 2 7 3 2 7 0 2 0 2 3 7 0
Cash flow at beginning 35 37 310 581 783
En din g ca sh flow 3 7 3 1 0 5 8 1 7 8 3 1 ,1 5 3
RATI OS
ROAE ( % ) 37. 1 39. 7 34.9 31.0 27.7
ROAA ( % ) 13. 8 16. 7 16.0 15.8 15.6
EPS growt h ( % ) 293.3 58. 4 27.7 23.2 20.0
Gross m argin ( % ) 43. 0 51. 4 53.4 52.5 51.9
EBI T m argin ( % ) 33. 7 43. 1 45.3 44.4 44.0
Net m argin ( % ) 28. 5 40. 2 43.1 42.3 42.0
Pay out r at io ( % ) - - -
I nt erest coverage ( x) 22. 5 na na na na
Net gearing ( % ) 12. 5 nc nc nc nc
Debt s t o asset s ( % ) 6. 9 - - - -
Debt or t urnov er ( day s) 27 23 25 25 25
Credit or t urnover ( days) 78 75 1 1 1
I nv ent ory t ur nover ( day s) na na na na na
M AJOR ASSUM PTI ON S
Grs. m rgn–ind/ com ( % ) 42. 9 54. 3 56.0 56.0 56.0
Grs. m rgn–resident ial( % ) 37. 4 41. 8 44.0 44.0 44.0
Rev enue grow t h ( % ) 123.0 12. 3 19.2 25.5 20.7
Mark et ing sales ( I DRb) 1,301 2, 061 2, 370 2,654 2,973
Sour ce: Com pany, Bahana est im at es
Ea r n in gs n ot t ie d t o int e r e st e x pe nse a s LPCK …
… r e m a in s fr e e f r om int e r e st be a r in g lia bilit ie s post loa n r e pa y m e n t in 2 0 1 2
St a ble a n d posit ive ope r a t in g ca sh flow
Slig h t m a r gin con t r a ct ion s fr om 2 0 1 4 on sh ift in g f ocu s t o r e side n t ia l sa le s
PT Ba h a n a Se cu r it ie s – Equ it y Re se a r ch – Lippo Cik a r a n g 3
Ex h ibit 6 . M a r k e t in g sa le s, 2 0 1 1 - 2 0 1 5 F
1,301
2,061
551
2,370
2,654
2,973
0 500 1,000 1,500 2,000 2,500 3,000 3,500
2011 2012 1Q13 2013F 2014F 2015F
(IDRb)
Sour ce: Com pany, Bahana est im at es
Ex h ibit 7 . M a r k e t in g sa le s pr opor t ion , 2 0 1 1 - 2 0 1 5 F
69
61
34 40 38 35
31
39
66 60 63 65
0 10 20 30 40 50 60 70 80 90 100
2011 2012 1Q13 2013F 2014F 2015F
(%)
Industrial Residential
Sour ce: Com pany, Bahana est im at es
Ex h ibit 8 . I n d ust r ia l pla y e r s - r e m a in in g gr oss la n dba n k
1,021
868 851
582
0 200 400 600 800 1,000 1,200
KIJA BEST SSIA LPCK
(ha)
Sour ce: Com pany, Bahana est im at es
M a r k e t in g sa le s t o in cr e a se in 2 0 1 3 -1 5 F CAGR of -1 3 % w it h …
… r e side n t ia l sa le s
t o dom ina t e por t folio, a s …
Ex h ibit 9 . Qua r t e r ly M a r k e t in g sa le s, 1 Q1 1 - 1 Q1 3
278
208
120
286
540
395
166 154 185
92
123 127
69
180
128
95
403
366
0 100 200 300 400 500 600
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13
(IDRb)
Industrial Residential
Sour ce: Com pany, Bahana est im at es
Ex h ibit 1 0 . Re v e n u e , 2 0 1 1 - 2 0 1 5 F
902
1,013
1,207
1,515
1,829
0 400 800 1,200 1,600 2,000
2011 2012 2013F 2014F 2015F
(IDRb)
Sour ce: Com pany, Bahana est im at es
Ex h ibit 1 1 . Re v e n u e br e a k dow n , 2 0 1 1 - 2 0 1 5 F
66
61 64 59
52
22
26 25 32
40
10 1 11 2 9 2 8 1 7 1
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
2011 2012 2013F 2014F 2015F
Industrial & commercial land sales Residential land sales Estate management Others
Sour ce: Com pany, Bahana est im at es
Tr iv ium Te r r a ce Apa r t m e n t la un ch in 4 Q1 2 h a s boost e d LPCK’s r e side n t ia l sa le s
Solid m a r k e t in g sa le s t o suppor t 2 0 1 3 - 1 5 F r e ve n ue CAGR of 2 2 % …
PT Ba h a n a Se cu r it ie s – Equ it y Re se a r ch – Lippo Cik a r a n g 5
Ex h ibit 1 2 . LPCK m a r gin s, 2 0 1 1 - 2 0 1 5 F
43.0
51.4
53.4 52.5
51.9
33.7
43.1
45.3 44.4
44.0
28.5
40.2
43.1 42.3 42.0
10 20 30 40 50 60
2011 2012 2013F 2014F 2015F
(%)
Gross margin EBIT margin Net margin
Sour ce: Bahana est im at es
Ex h ibit 1 3 . Gr oss m a r gin by t ype of la n d sa le s, 2 0 1 0 - 2 0 1 2
52.7
42.9
54.3
34.9
37.4
41.8
30 35 40 45 50 55
2010 2011 2012
(%)
Industrial & commercial land sales Residential land sales
Sour ce: Com pany, Bahana est im at es
Ex h ibit 1 4 . N e t p r ofit , 2 0 1 1 - 2 0 1 5 F
257
407
520
641
769
0 100 200 300 400 500 600 700 800 900
2011 2012 2013F 2014F 2015F
(IDRb)
Sour ce: Com pany, Bahana est im at es
W e e x pe ct LPCK t o e x pe r ie nce m a r gin cont r a ct ion s fr om 2 0 1 4 on t h e ba ck of …
… r e side n t ia l sa le s be ing low e r - m a r gin
com pa r e d t o in du st r ia l sa le s; h ow e ve r , …
Ex h ibit 1 5 . N e w t oll r oa d a cce ss ( 1 )
Sour ce: Com pany
Ex h ibit 1 6 . N e w t oll r oa d a cce ss ( 2 )
Sour ce: Com pany
Ex h ibit 1 7 . Ja pa n e se SM Es Ce n t e r
Sour ce: Com pany
N e a r ly com ple t e d n e w t oll r oa d a cce ss a t 3 4 .7 k m Ja k a r t a - Cik a m pe k w it h …
… dir e ct e x it a cce ss n e a r LPCK’s a r e a
Re cu r r ing incom e s
PT Ba h a n a Se cu r it ie s – Equ it y Re se a r ch – Lippo Cik a r a n g 7
Ex h ibit 1 8 . Lippo Cik a r a n g Cit y Ce nt e r m a st e r pla n
Sour ce: Com pany
Ex h ibit 1 9 . Ea r n in gs r e v isions
Old N e w % ch a n ge s
( I D Rb) 2 0 1 3 F 2 0 1 4 F 2 0 1 5 F 2 0 1 3 F 2 0 1 4 F 2 0 1 5 F 2 0 1 3 F 2 0 1 4 F 2 0 1 5 F
EBI T 721 818 - 547 673 - ( 24.1) ( 17.7) -
EBI T m argin ( % ) 45.6 45.0 - 45.3 44.4 -
Net profit 623 745 - 520 641 - ( 16.4) ( 14.0) -
Net m ar gin ( % ) 41.1 41.0 - 43.1 42.3 -
Sour ce: Bahana est im at es
Ex h ibit 2 0 . N AV Ca lcu la t ion
Re side n t ia l I n du st r ia l Tot a l
Undev eloped ( ha) 43 257 300
Developed ( ha) 155 127 282
La nd v a lu e ( I D Rb) 7 ,2 3 7 4 ,6 0 4 1 1 ,8 3 6
Net debt ( I DRb) 783
Cust om er deposit ( I DRb) ( 1,911)
Tot a l v a lu e ( I D Rb) 1 0 ,7 0 7
No of shar es ( b) 0.7
NAV/ share ( I DRb) 15,384
Discount t o NAV 40%
Adj ust e d N AV ( I D R/ sh a r e ) 9 ,3 0 0
Sour ce: Com pany, Bahana est im at es
LCCC m a st e r pla n t a r ge t e d for com ple t ion by 2 0 2 0
Re v ise d 2 0 1 3 - 1 4 F bot t om lin e s by 1 6 % a n d 1 4 % r e spe ct iv e ly
Ex h ibit 2 1 . Pe e r com pa r ison , 2 0 1 3 F
BEST KI JA SSI A LPCK Se ct or
NAV/ share ( I DR) 1,494 1,059 2,167 15,384
Target pr ice ( I DR) 1,190 445 1,800 9,300
Discount TP ( % ) 20 58 17 40
Cur r ent pr ice ( I DR) 660 315 1,120 7,300
Disc t o NAV ( % ) 55.8 70.3 48.3 52.5 57.4
Upside ( % ) 8 0 .3 4 1 .3 6 0 .7 2 7 .4 5 3 .4
Shar es out st anding ( b) 9.6 20.1 4.7 0.7
Mar ket cap ( I DRb) 6,367 6,340 5,270 5,081 23,058
3m avg daily t ur nover ( I DRb) 22.9 32.9 38.7 40.4
Mar ket cap ( USDm ) 642 639 670 512 2,462
3m avg daily t ur nover ( USDm ) 2.5 3.4 4.0 4.4
Land bank ( Ha) – gr oss 868 2,700 851 582 5,001
Rev enue ( I DRb) 1,405 2,833 4,635 1,207
Gr oss pr ofit ( I DRb) 967 1,277 1,641 644
Oper at ing profit ( I DRb) 910 978 1,224 547
EBI TDA ( I DRb) 914 1,084 1,315 554
Pr e- t ax pr ofit ( I DRb) 874 783 1,153 580
Net pr ofit ( I DRb) 804 642 928 520
% recurr ing t o t ot al r evenue 3.2 48.7 14.2 0.1 18.0
% developm ent t o t ot al r evenue 96.8 51.3 85.8 99.9 82.0
M a r gin ( % )
Gr oss m ar gin ( % ) 68.8 45.1 35.4 53.4 51.2
Oper at ing m argin ( % ) 64.7 34.5 26.4 45.3 43.3
EBI TDA m ar gin ( % ) 65.1 38.3 28.4 45.9 45.0
Pr e- t ax m ar gin ( % ) 62.2 27.7 24.9 48.1 40.9
Net m argin ( % ) 57.2 22.7 20.0 43.1 36.0
Gr ow t h ( % )
Rev enue 45.6 102.2 30.0 19.2 52.6
Gr oss pr ofit 68.3 48.5 26.6 23.8 43.7
Oper at ing profit 72.6 56.4 33.4 25.3 49.0
EBI TDA 72.6 58.9 30.2 25.5 49.0
Pr e- t ax pr ofit 68.9 71.1 31.3 26.8 52.0
Net pr ofit 70.9 68.8 31.3 27.7 52.1
EPS grow t h 49.4 68.4 31.3 27.7 46.1
PE ( x) 7.9 9.8 5.7 9.8 8.3
PBV ( x) 2.3 1.4 2.2 2.9 2.2
PEG ( x) 0.2 0.1 0.2 0.4 0.2
Debt t o equit y ( % ) 21.3 44.4 82.3 - 36.9
Net gear ing ( % ) 8.0 33.7 9.0 nc
EBI T/ net int . exp. ( x) 28.6 4.3 16.3 na
BVPS ( I DR/ share) 281 228 519 2,512
EPS ( I DR/ share) 83 32 197 747
DPS ( I DR/ shar e) 17 11 18 -
Dividend yield ( % ) 2.5 3.5 1.6 - 2.0
ROAA ( % ) 28.3 8.5 18.0 16.0 17.8
ROAE ( % ) 37.8 15.0 45.9 34.9 32.8
Sour ce: Com pany,Bloom berg, Bahana est im at es
N ico La u r e n s Manager , Sur abaya Br anch
ext 7250 Senior Associat e Direct or Head of Equit y Capit al Market & Resear ch
St rat egy, Telcos, Consum er, Aviat ion ex t 3600
direct : + 62 21 250 5735
Te gu h H a r t a n t o t eguh.hart ant o@bahana.co.id
Associat e Direct or Deput y Head of Research
Banks, Cem ent
I ndonesia I ndonesia
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t he r eport in t he past 12 m ont hs.
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