lippo karawaci · pdf filelpkr operates 43 malls throughout indonesia with total gross ......
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PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS BEGINNING ON PAGE 13.
Lippo Karawaci (LPKR)
The integrated property developer
The most integrated property company
Lippo Karawaci (LPKR) has several lines of business streams which separates the
company from the rest. Other than its core property business, the company is also
exposed to healthcare business, hotel management and funeral homes (non-core
businesses). LPKR has property assets in Lippo Village, Lippo Cikarang and Tanjung
Bunga, and Makassar (South Sulawesi). In our view, LPKR’s non-core businesses
complement the company’s overall performance and act as fat buffers amid unfavorable
property market situations. The contribution from healthcare business is becoming
larger every year, despite relatively stagnant performances from its hotel and funeral
home businesses.
The next growth engine: Hospital business
Growing health awareness motivates LPKR to drive its healthcare business further. The
company is in its early stage of developing 46 hospitals under the brand name “Siloam
Hospital”. Due to slowing property market growth (both residential and commercial),
LPKR’s performance improvement is strongly supported by healthcare business which is
evident by its increasing portion to its total revenue. As of 9M15, healthcare business
contributed IDR3r to the company’s revenue (an increase by 24.8% YoY), compared to
the total revenue growth of 10.4% YoY to IDR6.8tr. Healthcare business contribution to
total revenue came in at 45% in 9M15 compared to 39% a year earlier.
Stable revenue growth with CAGR of 28%
LPKR delivered revenue growth of 28% CAGR (excluding assets sold to REITS) over the
last 4 years (2010 ~ 2014). Healthcare business growth posted a solid 34% CAGR during
the same period. We see that LPKR optimizes its healthcare business for complementing
its overall business model and buffering earnings volatility stemming from its property
business.
Initiate coverage with a Trading Buy call
We initiate LPKR on Trading Buy rating with target price of IDR1,175 by using DCF
method (16.3% upside potential), with WACC of 11.1%. Key risk to our recommendation
is lower than expected growth of property sales.
FY (Dec) 12/12 12/13 12/14 15/15F 12/16F
Revenue (IDRbn) 6,160 6,666 11,655 9,475 11,765
OP (IDRbn) 1,549 1,943 3,809 2,551 3,147
OP Margin (%) 25.1 29.1 32.7 26.9 26.7
NP (IDRbn) 1,060 1,228 2,547 1,508 1,867
EPS (IDR) 46.5 53.9 111.9 65.3 80.9
ROE (%) 9.9 9.6 16.3 8.3 9.8
P/E (x) 21.7 18.7 9.0 15.5 12.5
P/B (x) 2.2 1.8 1.5 1.3 1.2
Note: All figures are based on consolidated basis; NP refers to net profit attributable to controlling interests
Source: Company data, KDB Daewoo Securities Research estimates
Property
Initiation report
January 12, 2016
(Initiate) Trading Buy
Target Price (12M, IDR) 1,175
Share Price (1/11/16 IDR) 1,010
Expected Return 16.3%
Market Cap (IDRbn) 23,308.8
Shares Outstanding (mn) 23,077.7
52-Week Low (IDR) 975
52-Week High (IDR) 1,460
(%) 1M 6M 12M
Absolute -10.2 -15.8 -3.3
Relative -11.9 -7.7 11.1
PT Daewoo Securities Indonesia
Developers
Maxi Liesyaputra
+62-21-515-1140
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Company description
Lippo Karawaci was formed through the merger of 8 property and property related
companies in 2004. The company has two basic revenue streams, consisting of
development revenue and recurring revenue. For the development revenue, the company
develops 7 locations throughout Indonesia, which are Lippo Village in Karawaci, Lippo
Cikarang (combination of industrial area and residence), Holland Village in Makassar and
Central Jakarta, Tanjung Bunga in Makassar, St. Moritz in West Jakarta and San Diego Hills,
a memorial park and funeral homes.
For recurring revenue stream, one unique thing is that LPKR operates hospitals under the
brand of “Siloam Hospitals”. Currently LPKR operates 20 hospitals (total 4,790 beds) in
locations throughout Indonesia, with outstanding specialty in each hospitals. For example,
Siloam Hospitals Lippo Village has good track record in the areas of cardiology,
neuroscience, orthopedics and emergency, while MRCCC Siloam Semanggi has strength in
the fields of cancer, liver and emergency. In short to mid-term, LPKR will build additional
Siloam hospitals in Bogor, Jember, Labuan Bajo, Lubuk Linggau, Bangka Belitung, Ambon,
Makassar and Central Jakarta.
Another business from recurring revenue is through the operations of Aryaduta Hotels
with average occupancy rate of 66% as of June 30, 2015 and total 1,684 rooms from 8
hotels in Sumatra, Java and Sulawesi. The largest is hotel Aryaduta in Central Jakarta with
302 rooms, followed by hotel Aryaduta Semanggi (South Jakarta) with 274 rooms.
LPKR operates 43 malls throughout Indonesia with total gross floor area (GFA) of 3.1mn
sqm. Among the operating malls are Lippo Mall Puri, PX Pavillion and Maxxboxx Karawaci.
The company also has two malls under development, which are Lippo Plaza Mampang and
Lippo Plaza Pangrango.
Figure 1. LPKR corporate structure
Source: Company, KDB Daewoo Securities Research
Source: Company, KDB Daewoo Securities Research
Figure 2. Shareholding structure
Source: Company, KDB Daewoo Securities Research
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Figure 3. Projects and land banks
Source: Company, KDB Daewoo Securities Research
Potential earnings upside in FY16, supported by healthcare
Heading into 2016, we expect to see increasing earnings contribution from its healthcare
business. We do not expect significant earnings contribution growth from its core
property business, as we believe that domestic property market is yet to fully recover this
year. Even if we strip off the assets sold to REITS in 2014, we believe the company will not
be able to meet its marketing sales target (company target: IDR4tr vs. ours IDR3.5tr) in
2015. This trend is likely to continue heading into this year, in our view.
We believe that LPKR will be very cautious in launching its new property products given
unsupportive market backdrop. The company may expect positive catalyst from the
implementation of new luxury tax on property which defines luxury landed house with
price at least IDR20bn per unit and apartment of at least IDR10bn per unit. Previously
regulation considered a house “luxury” if it had total building area of 350sqm or more. The
previous regulation also stated that for apartments, it is considered luxury if it has a total
building area of 150sqm or more.
Apart from its property business, LPKR is optimistic on healthcare business growth, in
conjunction with the hospital’s rapid expansion. In 2016 LPKR is expected to open 6 new
hospitals located in Labuan Bajo, Bau-bau, Sorong, Bogor, Jember and Bangka Belitung.
The company is also in the developing stage of 18 new hospitals which will be located in
Sumatra, Java, Kalimantan and Sulawesi.
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Figure 4. Marketing sales trend
Source: Company, KDB Daewoo Securities Research
Figure 5. Marketing sales by category
Marketing sales
IDRbn 2011 2012 2013 2014 9M15
Township total 1,882 3,064 2,400 2,115 1,476
Condominium total 1,161 1,501 1,034 2,677 1,452
Office total 124 100 671 388 11
Retail space 11 18 11 5 0
Sub total 3,178 4,683 4,116 5,185 2,940
Asset sold to REITS 0 2,077 1,482 3,330 0
Total 3,178 6,760 5,598 8,515 2,940
Source: Company, KDB Daewoo Securities Research
Launching clusters in FY15
In FY15 LPKR launched seven projects (both landed houses and high rise residential). For
landed houses, the company launched Le Freya (May 2015) and Cosmo Terrace
(September 2015) in Lippo Cikarang (both were 100% sold) and Holland Village in Manado
in June 2015 (83% sold). For the high-rise residential projects, the company launched
Pasadena Suites (the third tower in Orange County, Lippo Cikarang, 100% sold) in March
2015, Monaco Bay (a mixed-use project in Manado, 85% sold) in May 2015 and the
Burbank Suit (the whole fourth residential tower in Lippo Cikarang to a single Japanese
investor) in June 2015.
Most recently, on December 5, 2015, LPKR conducted the grand preview of luxurious
condominium of Glendale Park Orange County in Lippo Cikarang, which was completely
sold out. From the launching, LPKR is expected to add IDR540bn to its marketing sales
which support the company to achieve its 2015 marketing sales target of IDR4tr (9M15
marketing sales of IDR2.94tr).
We conclude that every project launched in Lippo Cikarang was absorbed very well, due to
its positioning as an integrated industrial area.
Improving healthcare business to support performance growth
Indonesia healthcare industry still has big potential room to grow compared to other
countries in the region. Hospital bed per 10,000 is only 9, compared to Singapore of 20
and China of 38. Physician per 10,000 people remains low at 2, compared to Malaysia at 12.
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Figure 6. Comparison health statistics
Source: WHO 2015, KDB Daewoo Securities Research
Total healthcare spending as a % of GDP stood at 3%, compared to South Korea of 7.6%
and USA of 17.0%. Even for total expenditure per capita on healthcare, Indonesia only
spends USD273 compared to Malaysia of USD894 and much smaller than Singapore of
USD3,215.
Figure 7. Comparison health statistics of GDP
Source: WHO 2015, KDB Daewoo Securities Research
The private sector contributed more in hospital developments, along with district
government and army/police. This is strongly required to complement the limited budget
flexibility by the central government.
Figure 8. Hospitals in Indonesia
Source: Ministry of Health, KDB Daewoo Securities Research
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Seizing the opportunity in healthcare business, LPKR continuously optimizes its healthcare
business. The company’s healthcare business shows continuous growth, in line with its
hospital expansion. In 9M15, healthcare revenue grew by 25% YoY to IDR3tr, which is
higher than the total revenue growth of 10% YoY. The portion to the total revenue also
improved to 46% in 9M15 from 39% in 9M14. The urban development business only
showed growth of 13% YoY. On the other hand, large scale integrated development
declined by 17% YoY to IDR890bn.
Figure 9. List of Siloam Hospitals
No Locations Beds No Locations Beds
1 Lippo Village 308 11 Cinere 40
2 Kebon Jeruk 283 12 Palembang 357
3 Surabaya 162 13 Bali 283
4 Cikarang 109 14 TB Simatupang 269
5 MRCCC 334 15 Kuta 21
6 Jambi 100 16 Nusa Dua 20
7 Balikpapan 232 17 Purwakarta 210
8 Tangerang (General) 640 18 Asri 40
9 Manado 230 19 Kupang 405
10 Makassar 360 20 Medan 388
Source: Company, KDB Daewoo Securities Research
For comparison, in FY14 healthcare business also showed solid revenue improvement by
33% YoY to IDR3.3tr. The highest business growth contribution came from the urban
development business which grew by two folds to IDR5.6tr. However, we note that this
figure includes the sale of Kemang Village mall to REIT (IDR3.37tr). If we peel away the
one-off sales to REIT, urban development growth would have picked up 21% YoY to
IDR2.7tr. In the period of 2011 ~ 2014, healthcare business showed significant revenue
improvement with CAGR of 38.3%.
We believe the healthcare business will continue to grow in conjunction with hospital
expansions throughout Indonesia. In FY16, we expect healthcare business to grow by 24%
YoY, in line with our expected FY15 growth of 25% YoY.
Figure 10. MRCCC Siloam Semanggi
Source: Company, KDB Daewoo Securities Researc
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Figure 11. Healthcare business revenue
Source: Company, KDB Daewoo Securities Research
Limited land bank in Lippo Cikarang
At present, the company has total land bank of 445ha in Lippo Cikarang (157ha for
residential, 288ha for industrial). To manage the limited land bank, LPKR launched high
residential project namely Orange County with 4 towers (Westwood Suites, Irvine Suites,
Pasadena Suites and Burbank Suites). Irvine and Westwood were launched in 2014, while
Pasadena and Burbank were launched in 2015
Figure 12. Orange Country residential towers
Source: Company, KDB Daewoo Securities Research
We believe that LPKR still needs to acquire big land for improving its land bank, mainly
for industrial area. Every manufacturing plant requires sizeable area to support its
production activities, such as for inventory space, plant machine, waste management,
etc. Lippo Cikarang still has rights to acquire another 588ha for its industrial area.
SWOT analysis
According to our SWOT analysis, we conclude that LPKR has a strong point its well-
diversified business. Entering the healthcare business increases the company’s ability to still
have growth, especially when domestic property market is facing slower pace.
Strength
Supported by various business types with significant contribution from non-core
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businesses (healthcare, hospitality and infrastructure, memorial park). The
diversified contribution from various businesses of the company cushions LPKR’s
financial performance during unfavorable property market environment. We
conclude that LPKR is the most integrated business property company in Indonesia.
Continuing expansion in healthcare business. LPKR expands the healthcare business
through the development of new Siloam Hospitals in many strategic areas across
Indonesia.
Weakness
High USD exposure. The company issued global bond of USD803.3mn as of
September 2015 (represents all of its total foreign debt)
Dependency on asset sold to REITS to boost marketing sales. In FY14 LPKR posted
IDR3.3tr worth of assets sold to REITS, which drove its total marketing sales to
reach IDR8.5tr for the year. If we strip away the assets sold, LPKR only booked
marketing sales of IDR5.2tr. Assets sold to REITS represented 39% to total
marketing sales in FY14.
High dependency on healthcare business to stimulate growth. The company’s total
revenue grew by CAGR of 30.7% in 2011 ~2014, lower than healthcare business
CAGR of 38.3% in the same period. Although LPKR’s revenue jumped in FY14 on
the back of sales of its asset to REITS, the company only posted growth of 8.2%
YoY in FY13 revenue.
Opportunities
Growing awareness of health. Siloam Hospital is expected to benefit from the
increasing awareness of health. The healthcare business grabs the opportunity by
developing more hospitals throughout Indonesia
Improving demand for Lippo Cikarang - an integrated industrial area. LPKR enjoys
rising position of Lippo Cikarang as an integrated industrial area. Every launching in
the area has been well absorbed.
Threats
Slowing property demand. Factoring in the slow property demand, LPKR slashed its
marketing sales target to IDR4tr from previous IDR6tr (excluding planned asset
sold to REIT of IDR1.5tr) in FY15.
Heightened competition in obtaining customers. Related to slowing absorption of
domestic property products, LPKR should have a unique strategy to attract more
customers than its competitors.
Diversified location
LPKR develops property in many areas throughout Indonesia with sizeable development
rights. There is still big room for the company to expand through land acquisition further,
although there will be problems for the action, such as society resistance and the price is
getting higher more than expected.
Lippo Village has only acquired less than half of its development rights. Tanjung Bunga
Makassar and Lippo Cikarang (for industrial) still have much room for more land acquisition.
In total, LPKR still has room to acquire another 3,200ha (currently the company only
acquired 60% of its development rights).
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Figure 13. Golf condominium in Lippo Village
Source: Company, KDB Daewoo Securities Research
Figure 14. Land bank and development rights
Land bank Development Acquired
(ha) rights (ha) land (ha)
Lippo Village 343 3,066 1,184
Lippo Cikarang
- Residential 157 887 981
- Industrial 288 2,364 1,776
Tanjung Bunga, Makassar 300 1,500 644
San Diego Hills 93 125 121
Others 93 116 149
Total 1,274 8,058 4,855
Source: Company, KDB Daewoo Securities Research
Ongoing projects
Following the product launching, LPKR is still in development progress of several
projects, such as The Nine Residence, Holland Village and Park View apartments
(launched in the period of 2011-2013). For more recent launching (2014), the projects
under construction including St. Moritz Makassar, Embarcadero Bintaro Western Wing
Tangerang, office tower in Holland Village Centrla Jakarta and Hillcrest + Fairview Lippo
Village.
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Figure 15. Holland Village Central Jakarta
Source: Company, KDB Daewoo Securities Research
Financial analysis
In the period of 2011 ~ 2014, LPKR exhibited gradual increase in both revenue and net profit.
A significant financial performance jump occurred in FY14 following the sales of assets to
REITS worth IDR3.3tr. This was the largest asset sold to REITS, compared to 2013 worth
IDR1.48tr and 2012 worth IDR2.08tr. Net profit in 2014 also jumped 107.4% YoY to
IDR2.55tr. Gross margin was relatively stable between 45% and 46%. Net margin was also
relatively stable in the period, except for FY14 which recorded a very high net margin (29%)
compared to approximately 17% ~ 18% in 2011 ~ 2013 along with high value in asset sold to
REITS (IDR3.3tr). Entering 2016, we believe that LPKR still has potential revenue growth of
24% YoY to IDR11.8tr with high contribution from healthcare business and urban
development.
Figure 16. LPKR financial performance
Source: Company, KDB Daewoo Securities Research
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Figure 17. LPKR margins
Source: Company, KDB Daewoo Securities Research
The hotel brand, Aryaduta
To complement LPKR’s business portfolio, the company also owns and manages hotels under
the brand name of Aryaduta. However, revenue growth from its hotel business is still far
from satisfying (IDR223.5bn in 2011 vs. IDR293.1bn in 2014). Looking into more detail,
revenue in FY14 declined by 6.3% YoY. Actually the hotel locations are in prime areas, such as
Aryaduta Jakarta in the heart of the city and Aryaduta Semanggi, located in near Jakarta
CBD. This is contrary with increasing foreign tourists coming to Indonesia by 7.2% YoY to
10.2mn people in FY14. In 2016, we expect there will be no significant improvement in hotel
performance. Besides, the revenue contribution of hotel operation to total revenue,
approximately of 3%. The number shows decline tendency from 5.3% in 2011 to 2.5% in
2014.
Figure 18. Hotel revenue
Source: Company, KDB Daewoo Securities Research
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Figure 19. Incoming foreign tourists to Indonesia
Source: BPS, KDB Daewoo Securities Research
A unique product of LPKR, San Diego Hills
As the largest integrated property company, the company sells memorial parks and funeral
homes, called San Diego Hills. It is located in Lippo Village, Karawaci. The funeral home is
also equipped with house of worship (Mosque, Church). LPKR has land bank in San Diego
Hills totaling 93ha with acquired land of 125ha. According to the company LPKR’s master
plan is to secure 500ha for funeral homes. Up to September 2015, the company has sold
37,300 plots. However, the revenue contribution is very small (2% of total revenue in
9M15).
We believe LPKR will only book flat revenue growth from its funeral homes in 2016. The
existence of San Diego Hills is to differentiate Lippo Village with other property areas in our
view, which provides funeral facilities for customers, mainly for Lippo Village residence. The
funeral home buyers only pay once when they purchase the land. After the purchase, LPKR
will cover all of the maintenance costs.
Figure 20. Memorial park revenue
Source: Company, KDB Daewoo Securities Research
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Valuation and recommendation
As an integrated developer company, LPKR has the capacity to provide complete range of
property products and services, complemented by healthcare services. This differentiates
LPKR with other domestic property companies, in our opinion. We believe that the strategy
for business diversification is suitable for weathering turbulence in slowing property market
environment. Also, LPKR sells and leases back its asset to REITS for improving revenue and
cash flow.
Figure 21. Peers comparison
Source: Bloomberg, KDB Daewoo Securities Research
The location of LPKR’s property areas in western part of Java and south Sulawesi is good
for location portfolio. The objective is to capture middle up customers in different regions
in Indonesia.
Currently LPKR is traded at 2016F PER of 12.5x. We initiate coverage LPKR with Trading
Buy call. The target price for LPKR is IDR1,175 with 16.3% upside potential by using DCF
method (WACC of 11.1%).
Figure 22. DCF assumption
Source: KDB Daewoo Securities Research
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Figure 23. P/E band
Source: Bloomberg, KDB Daewoo Securities Research
LPKR share price is quite volatile, although still always higher than the industry movement.
Investors pay big attention to LPKR since it has the largest market capitalization among the
property companies and has integrated business portfolio.
Figure 24. LPKR vs JAKPROP
Source: Bloomberg, KDB Daewoo Securities Research
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Figure 24. NAV calculation
Source: Company, KDB Daewoo Securities Research
Ownership (%) Land area (ha) Assets value (IDRbn)
Urban development
Lippo Village 100 407 26,662
Lippo Cikarang 54.4 645 14,113
Tanjung Bunga 50.3 243 3,875
San Diego Hills 100 98 2,442
Micro suburbs 100 20 297
Sub total 47,389
Large scale integrated development
City of Tomorrow 85 5 725
Kemang Village 92 7 1,832
St Moritz 100 11 6,918
14 new projects 91 6,214
Others 100 2,458
Sub total 18,147
Retail malls
3 malls 1,756
Retail space inventory 673
Sub total 2,429
Hotels
2 hotels FREIT 681
Hotels 100 1,674
Sub total 2,355
REIT units 5,279
Hospitals 10,129
Estimated total asset value 85,728
Add Cash 1,584
Less Debt 12,283
Less Advances from customers 4,891
Estimated NAV 70,137
Issued shares (bn) 23
NAV/share (IDR) 3,039
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Indofood C Lippo Karawaci (LPKR/Trading Buy/TP: IDR1,175)
Income Statement (Summarized) Balance Sheet(Summarized)
(IDRbn) 12/13 12/14 12/15F 12/16F (IDRbn) 12/13 12/14 12/15F 12/16F
Revenue 6,666 11,655 9,475 11,765 Cash and equivalents 1,855 3,529 1,740 1,158
Cost of revenue (3,620) (6,258) (5,032) (6,176) Accounts & notes receivable 772 951 1,354 1,681
Gross profit 3,047 5,397 4,443 5,589 Inventories 13,894 16,553 20,129 22,233
Operating expenses (1,104) (1,589) (1,892) (2,442) Other current assets 7,492 8,929 10,422 12,534
Operating profit 1,943 3,809 2,551 3,147 Net fixed assets 2,811 3,209 3,530 3,706
Finance expense 94 65 43 29 Investment properties 306 310 310 310
Finance income (18) (114) (231) (275) Land for development 1611 1136 1250 1312
Net non-operating losses (gains) 1,925 3,695 2,320 2,872 Other long-term assets 580 719 843 992
Pre-tax profit (332) (560) (348) (431) Total assets 31,300 37,761 42,842 47,448
Tax expenses 94 65 43 29 Accounts payable 398 395 725 771
Minority interest 364 588 464 574 Short-term borrowings 17 186 307 396
Attributable net profit 1,228 2,547 1,508 1,867 Other short-term liabilities 300 407 407 407
Growth (%) Long-term borrowings 7,791 9,811 10,789 11,865
Revenue 8 75 (19) 24 Other long-term liabilities 2,297 2,763 3,099 4,185
Cost of revenue 8 73 (20) 23 Total liabilities 17,123 20,115 22,463 26,135
Gross profit 8 77 (18) 26 Paid in capital 2,308 2,308 2,308 2,308
Operating expenses (13) 44 19 29 Additional paid in capital 4,063 4,063 4,063 4,063
Operating profit 25 96 (33) 23 Retained earnings 4,748 6,976 7,730 8,663
Interest expense (91) 441 196 11 Total equity attributable parent 12,801 15,605 18,065 18,998
Pre-tax profit 22 92 (37) 24 Non-controlling interest 1,377 2,041 2,315 2,315
Tax expenses 31 68 (38) 24 Total shareholders’ equity 14,178 17,646 20,380 21,313
Attributable net profit 16 107 (41) 24
Key performance indicators
12/13 12/14 12/15F 12/16F
Per share data
EPS (IDR) 53.9 111.9 -65.3 80.9
EPS growth (%) 16.0 107.4 -41.6 23.8 Balance sheet growth rate
BPS (IDR) 554.7 676.2 782.8 823.2
12/13 12/14 12/15F 12/16F
BPS growth (%) 20.1 21.9 15.8 5.2 Cash and equivalents (44.4) 90.2 (50.7) (33.4)
DPS (IDR) 14.1 16.7 16.7 16.7 Accounts & notes receivable 29.8 23.3 42.3 24.2
Key ratios Inventories 32.3 19.1 21.6 10.5
ROE 9.6 16.3 8.3 9.8 Other current assets 48.6 19.2 16.7 20.3
ROA 3.9 6.7 3.5 3.9 Net fixed assets 26.5 14.2 10.0 5.0
Gross profit margin 45.7 46.3 46.9 47.5 Investment properties 1.5 1.3 0.0 0.0
OP margin 29.1 32.7 26.9 26.7 Land for development 73.4 (29.5) 10.0 5.0
Net profit margin 18.4 21.9 15.9 15.9 Other long-term assets 23.9 24.0 17.2 17.7
Tax rate 17.3 15.1 15.0 15.0 Total assets 25.9 20.6 13.5 10.8
Debt/equity 133.8 128.9 124.3 137.6 Accounts payable (30.9) (0.7) 83.5 6.3
Assets/equity 245 242 237 250 Short-term borrowings 4.0 1,012. 65.3 28.8
Current ratio 5.0 5.2 5.0 4.5 Other short-term liabilities 67.2 35.6 0.0 0.0
Payout ratio 26.0% 14.9% 25.5% 20.6% Long-term borrowings 29.9 25.9 10.0 10.0
Other long-term liabilities 3.1 20.3 12.2 35.0
Total liabilities 27.8 17.5 11.7 16.3
Paid in capital 0.0 0.0 0.0 0.0
Additional paid in capital 0.0 0.0 0.0 0.0
Retained earnings 25.3 46.9 10.8 12.1
Total equity attributable parent 20.1 21.9 15.8 5.2
Non-controlling interest 69.1 48.3 13.4 0.0
Total shareholders’ equity 23.6 24.5 15.5 4.6
Source: Company data, KDB Daewoo Securities Research estimates
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Important Disclosures & Disclaimers
Stock Ratings Industry Ratings
Buy Relative performance of 20% or greater Overweight Fundamentals are favorable or improving
Trading Buy Relative performance of 10% or greater, but with volatility Neutral Fundamentals are steady without any material changes
Hold Relative performance of -10% and 10% Underweight Fundamentals are unfavorable or worsening
Sell Relative performance of -10%
* Ratings and Target Price History (Share price (----), Target price (----), Not covered (■), Buy (▲), Trading Buy (■), Hold (●), Sell (◆))
* Our investment rating is a guide to the relative return of the stock versus the market over the next 12 months.
* Although it is not part of the official ratings at Daewoo Securities, we may call a trading opportunity in case there is a technical or short-term material
development.
* The target price was determined by the research analyst through valuation methods discussed in this report, in part based on the analyst’s estimate of
future earnings.
The achievement of the target price may be impeded by risks related to the subject securities and companies, as well as general market and economic
conditions.
Analyst Certification
The research analysts who prepared this report (the “Analysts”) are registered with the Indonesian jurisdiction and are subject to Indonesian securities
regulations. They are neither registered as research analysts in any other jurisdiction nor subject to the laws and regulations thereof. Opinions expressed in
this publication about the subject securities and companies accurately reflect the personal views of the Analysts primarily responsible for this report. Except
as otherwise specified herein, the Analysts have not received any compensation or any other benefits from the subject companies in the past 12 months and
have not been promised the same in connection with this report. No part of the compensation of the Analysts was, is, or will be directly or indirectly related
to the specific recommendations or views contained in this report but, like all employees of PT Daewoo Securities Indonesia, the Analysts receive
compensation that is impacted by overall firm profitability, which includes revenues from, among other business units, the institutional equities, investment
banking, proprietary trading and private client division. At the time of publication of this report, the Analysts do not know or have reason to know of any
actual, material conflict of interest of the Analyst or PT Daewoo Securities Indonesia except as otherwise stated herein.
Disclaimers
This report is published by PT Daewoo Securities Indonesia (“Daewoo”), a broker-dealer registered in the Republic of Indonesia and a member of the
Indonesia Exchange. Information and opinions contained herein have been compiled from sources believed to be reliable and in good faith, but such
information has not been independently verified and Daewoo makes no guarantee, representation or warranty, express or implied, as to the fairness,
accuracy, completeness or correctness of the information and opinions contained herein or of any translation into English from the Bahasa Indonesia. If this
report is an English translation of a report prepared in the Indonesian language, the original Indonesian language report may have been made available to
investors in advance of this report. Daewoo, its affiliates and their directors, officers, employees and agents do not accept any liability for any loss arising
from the use hereof. This report is for general information purposes only and it is not and should not be construed as an offer or a solicitation of an offer to
effect transactions in any securities or other financial instruments. The intended recipients of this report are sophisticated institutional investors who have
substantial knowledge of the local business environment, its common practices, laws and accounting principles and no person whose receipt or use of this
report would violate any laws and regulations or subject Daewoo and its affiliates to registration or licensing requirements in any jurisdiction should receive
or make any use hereof. Information and opinions contained herein are subject to change without notice and no part of this document may be copied or
reproduced in any manner or form or redistributed or published, in whole or in part, without the prior written consent of Daewoo. Daewoo, its affiliates and
their directors, officers, employees and agents may have long or short positions in any of the subject securities at any time and may make a purchase or sale,
or offer to make a purchase or sale, of any such securities or other financial instruments from time to time in the open market or otherwise, in each case
either as principals or agents. Daewoo and its affiliates may have had, or may be expecting to enter into, business relationships with the subject companies to
provide investment banking, market-making or other financial services as are permitted under applicable laws and regulations. The price and value of the
investments referred to in this report and the income from them may go down as well as up, and investors may realize losses on any investments. Past
performance is not a guide to future performance. Future returns are not guaranteed, and a loss of original capital may occur.
Disclosures
As of the publication date, PT Daewoo Securities Indonesia, and/or its affiliates do not have any special
interest with the subject company and do not own 1% or more of the subject company's shares
outstanding.
Lippo Karawaci
18
January 12, 2016
KDB Daewoo Securities Indonesia Research
Distribution
United Kingdom: This report is being distributed by Daewoo Securities (Europe) Ltd. in the United Kingdom only to (i) investment professionals falling within
Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”), and (ii) high net worth companies and other
persons to whom it may lawfully be communicated, falling within Article 49(2)(A) to (E) of the Order (all such persons together being referred to as “Relevant
Persons”). This report is directed only at Relevant Persons. Any person who is not a Relevant Person should not act or rely on this report or any of its
contents.
United States: This report is distributed in the U.S. by Daewoo Securities (America) Inc., a member of FINRA/SIPC, and is only intended for major institutional
investors as defined in Rule 15a-6(b)(4) under the U.S. Securities Exchange Act of 1934. All U.S. persons that receive this document by their acceptance
thereof represent and warrant that they are a major institutional investor and have not received this report under any express or implied understanding that
they will direct commission income to Daewoo or its affiliates. Any U.S. recipient of this document wishing to effect a transaction in any securities discussed
herein should contact and place orders with Daewoo Securities (America) Inc., which accepts responsibility for the contents of this report in the U.S. The
securities described in this report may not have been registered under the U.S. Securities Act of 1933, as amended, and, in such case, may not be offered or
sold in the U.S. or to U.S. persons absent registration or an applicable exemption from the registration requirements.
Hong Kong: This document has been approved for distribution in Hong Kong by Daewoo Securities (Hong Kong) Ltd., which is regulated by the Hong Kong
Securities and Futures Commission. The contents of this report have not been reviewed by any regulatory authority in Hong Kong. This report is for
distribution only to professional investors within the meaning of Part I of Schedule 1 to the Securities and Futures Ordinance of Hong Kong (Cap. 571, Laws
of Hong Kong) and any rules made thereunder and may not be redistributed in whole or in part in Hong Kong to any person.
All Other Jurisdictions: Customers in all other countries who wish to effect a transaction in any securities referenced in this report should contact Daewoo or
its affiliates only if distribution to or use by such customer of this report would not violate applicable laws and regulations and not subject Daewoo and its
affiliates to any registration or licensing requirement within such jurisdiction.
KDB Daewoo Securities International Network
Daewoo Securities Co. Ltd. (Seoul) Daewoo Securities (Hong Kong) Ltd. Daewoo Securities (America) Inc.
Head Office
14, Eunhaeng-ro, Yeongdeungpo-gu
Seoul 150-973
Korea
Suites 2005-2012
Two International Finance Centre
8 Finance Street, Central
Hong Kong
320 Park Avenue, 31st Floor.
New York, NY 10022
United States
Tel: 82-2-768-3026 Tel: 85-2-2514-1304 Tel: 1-212-407-1000
Daewoo Securities (Europe) Ltd. Daewoo Securities (Singapore) Pte. Ltd. Tokyo Representative Office
41st Floor, Tower 42
25 Old Broad Street
London EC2N 1HQ
United Kingdom
Six Battery Road #11-01
Singapore, 049909
7F, Yusen Building, 2-3-2
Marunouchi, Chiyoda-ku
Tokyo 100-0005
Japan
Tel: 44-20-7982-8000 Tel: 65-6671-9845 Tel: 81-3- 3211-5511
Beijing Representative Office Shanghai Representative Office Ho Chi Minh Representative Office
2401A, 24th Floor. East Tower
Twin Tower, B-12 Jianguomenwai Avenue
Chaoyang District, Beijing 100022
China
Room 38T31, 38F SWFC
100 Century Avenue, Pudong New Area,
Shanghai, 200120
China
Suites 901B. Centec Tower
72-74 Nguyen Thi Minh Khai St, Ward 6
District 3, HCMC
Tel: 86-10-6567-9699 Tel: 86-21-5013-6392 Tel: 84-8-3910-6000
Daewoo Investment Advisory (Beijing) Co., Ltd PT. Daewoo Securities Indonesia Daewoo Securities (Mongolia) LLC
2401B,24th Floor. East Tower
Twin Tower, B-12 Jianguomenwai Avenue
Chaoyang District, Beijing 100022
China
Equity Tower 50th Floor
Jl.Jend Sudirman, SCBD Lot 9
Jakarta 12190
#406, Blue Sky Tower, Peace Avenue 17
1 Khoroo, Sukhbaatar District
Ulaanbaatar 14240
Mongolia
Tel: 86-10-6567-9699 Tel: 62-21-2553-1000 Tel: 976-7011-0807