CIPUTRA SURYA (CTRS)

Target of economic growth at 5.8 % with infrastructure project as stimulus

Government took target of economic growth at 5.8 % in 2015. Many infrastructure projects will be started at 2015 which is expected supporting economic growth in 2015. The project includes power plant, water reserve construction, road, irrigation and etc.

Some analyst believe that the central bank will rise its rate over 8.25 % in order to sustain inflation rate as its anticipation to the fed’s monetary policy which plan to advance its rate at second semester of 2015.

Accordance to the economist of indonesia university, Lana Sulistyaningsih there will be a deficit in its current account if government run after the target growth at 5.8 % with infrastructure project. The project still depends on import to provide equipment, raw material and etc. For example, infrastructure project needs steels which are imported from oversea. So does power plant, government has to import the equipment from abroad such as turbine, boiler and etc. Inflation rate will be difficult to reduce inflation rate.

Politic situation in 2015 is unpredictable in indonesia

Based on research of Guillaume de gantes, 83 % of 60 rich persons (billionaires) which are interviewed, have bank account in oversea for saving and their business transaction. There is USD 200 millions of Indonesian billionaires’ asset which are in Singapore. They consider about stability of Indonesian politic circumstances in the future, no one knows about politic situation at the future.  11 % of Indonesian billionaires believe that is unpredictable.

In 2015, several analysts have prediction that the ministries in work team cabinet are vulnerable to be reshuffle.

Real estate Industry

Comprehensive Loan to Value regulation and higher interest rate

Loan to value regulation in 2013 protect the real estate investment from speculation. There are particular arrangements which manage Loan to Value base on number of ownership. People who own more than one loan for real estate will be charged smaller loan to value ratio. Bank will finance their loan in smaller part over the second loan.

Accordance to data, real estate industry has been growing steadily between in 2006 in to 2012. The average growth is at 13 % (current price). The industry is predicted growing slower as the demand of real estate predicted will drop because the central bank is predicted rising its rate in 2015 if the fed increase the fed fund rate at second semester of 2015. It will make the bank increase the interest rate.

The consumer will cut their spending include investing in real estate segment because of higher inflation rate, higher interest rate and new Loan to value regulation. Moreover, people will wait and see and they may possibly choose to save their money in the bank.

On other hand, government plans to conduct infrastructure project as stimulus. There will be many roads, toll road, bridges, those will open new access to several isolated district and there may be new residential houses, shop houses will be built.

Some investor tried to buy home in united state as its economy starts to recover; they expect the price will increase again in 2015.

Ciputra Surya

Family business with strong leadership  

Ciputra Surya is a subsidiary of CIputra development group which is run in real estate, hotel, and family recreation industry. Ciputra development is the majority share holder; it owns 63 % of total share.  The company leads by mr. ciputra’s family. His son in law, mr. Harun Hajadi is president director of the company. He holds MBA degree from university of southern california and architecture degree from university of California, Berkeley. Commonly they are good educated and hold master degree from oversea.

In 2013 the revenue increase 20.3 % up compared to sales in 2012. The company was able to increase its gross profit in to 57 % at 2013 which is bigger than gross profit in 2012, at 55 %.

In 2013 total asset has advanced at about 30 % compared to total asset of 2012. The company may possibly have many new projects in homes residential development. Real estate is still a key driver for the company which is contributing at 95 % of total revenue in 2013. The rest is villa and golf course. The biggest contribution was from project of citraland bagya city medan in north Sumatra. Its contribution was 33.4 % of its total land sold and it was 43.4 % of total sales.

The amount of Land development is at IDR 1,144 trillion, it hikes about 15 % up than its land development in 2012. Land for development is about 20 % of total asset in 2013. The company has land bank in several strategic places over all indonesia. Real Estate Company usually has land bank for future project. The valuation of its asset usually is conducted by independent appraisal.

Forecast

The predicted sales growth in 2014 is at 20.3 %, the same as the revenue growth in 2013, the company is expected at least reach the same increase at last year. The sales growth in 2015 and 2016 are predicted about 15 %. The average growth of real estate industry between in 2006 in to 2012 is at 13 %. The company is considered attain above 13 %, the stimulus of the government in infrastructure project might encourage real estate industry growing faster.

The net additional of fixed asset consider at 5-7 % of total sales in 2015 to in 2016.