my analysis: LPKR

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Thursday, July 14, 2016

LPKR 2015: Healthcare still growing

Slowdown in economic growth in indonesia at 2015 has affected the sales growth of the company. Economic growth in 2015 was only 4.8 %, it was slower than the growth at 2014 which was 5 %. It is the lowest growth at the last five years.

Commodity market dropped as the result of slowdown in economic growth of emerging market such as china and india.

Almost of all revenues from segments at the company dropped in 2015, it was only healthcare segment which increased 24 % up in comparison with the same segment at 2014. As the result of that total revenue of the company in 2015 has fallen more than 20 % in comparison with sales in 2014.

In 2015 the company developed Monaco bay, holland village at manado and was successfully selling Burbank tower at Orange county, new central district business which is developed by the company. Pasadena and Glendale park at orange county of Lippo Cikarang were also contributing to revenue in 2015. Glendale park is a joint venture with Mistsubishi corporation from Japan, the company was able to sell more 97 % of total unit.

More than 43 % of its total land for development is at Goa Makassar Tourism Development in Makassar, The Company may allocate more fund in developing Makassar at Sulawesi Island in the future.

Based on annual report of 2015, the biggest value of its land development is at Lippo Cikarang, its subsidiary at Cikarang, west Java. Lippo Cikarang has more than 1,196,782 hectare square land development. It is possible that the company will allocate more high value project at Lippo Cikarang as it developed Orange County, new CBD at Lippo Cikarang.

For healthcare business, the company plans to expand in this segment, it targeted 50 unit siloam hospital and clinic with 10.000 available bed. They plan to capture 15 million medical patients. For fund raising, the company has allocated stock to the market which was valued more than IDR 1.1 trillion. It corporate action decreased the ownership of LPKR in Siloam Hospital from 78 % in to 70 %.

Saturday, February 13, 2016

LPKR: Lippo Karawaci Tbk 2014

Company Analysis

Lippo Karawaci is one of biggest company which operates in real estate, hospitality, infrastructure and healthcare in indonesia. The company is owned by Pacific Asia holding (18.12 %), Metropolis Propertindo Utama (5.32%) and Public. It is the part of Lippogroup which operates in many others segments such as media, fashion and banking.

Lippo Karawaci has famous icon in real estate, hospitality and health care such as Kemang village, Saint moritz, Siloam and arya duta. All of them was reputable product and highly branded product.

Lippo group was founded by Indonesian tycoon, Mr. James Riady and Mochtar Riady. They have global networking in USA, Lippo North America who operates in energy sector and property sector. At recent, the third generation, Michael Riady, is commencing to replace his parent in managing Lippo group.

In 2014 Lippo Karawaci was led by Mr. Ketut Budi Wijaya who has been fulfilling as president director, for president commissioner position was fulfilled by Mr. Theo L Sambuaga.

Revenue

In 2014 Lippo Karawaci was able to increase its revenue, it increased more 74 % up compared to sales in 2013. The company increased its income on almost of all segment, the biggest contributor was from urban development that is operating in city development and its facilities. The second was contributed by healthcare segment.

In 2014 there were 14 projects on progress; the values of projects were more than IDR 1,655 billion. There were Lippo Cikarang’s projects and Mandiri Cipta Gemilang’s projects

In 2014 the company increased its debt to finance projects in several places, the new project could increase net profit margin from 23.89 % in 2013 in to 26.90 % in 2014. As the result of that the return of equity increased.

Saturday, February 7, 2015

LIPPO KARAWACI - LPKR

The Fed increased its rate, domestic economic growth has fallen

In 2014 the economic growth of indonesia is at 5.02 %. There is a significant decline in economic growth compared to its growth in 2013 which is at 5.8 %. the decline of exchange currency rupiah to US dollar may possibly be the biggest factor to the slower economic growth. As the fed has rised its fund rate, the foreign investor drawn their money and invest it back to america. The central bank has increased its rate to fight against inflation rate as the price level was starting to climb.

More than 30 % of government bond’s is owned by investor from oversea and indonesia used open market system such as floating exchange rate based on foreign exchange market. So when the investor from oversea sold their bonds and transferred their fund to US market the currency will fall and the price of good has rised as among of industries in indonesia still need to import goods for producing goods.

Based on forecast of the world bank the growth will be at 5.2 % in 2015. On other hand the government has target to attain 5.6 % growth in 2015. They plan to start various infrastructure project in the second semester in 2015 and they believed that its project will be able to drive the economic growth.

The industry which is related government’s main plan of development predicted will incerase significantly include the property development and operation. Healthcare is one of prospective segment too in 2015 as the government has improved their social security with several programs such as BPJS, Kartu Indonesia sehat and etc.

Real estate industry

According to BPS the monthly average expenditure per capita for housing and household in 2013 slightly increase at 7 % compared to 2012. It may indicate that real estate market is still stable and the demand for property is still growing.

Company analysis : High quality product in strategic place

Lippo karawaci is owned by Pacific Asia Holdings Ltd with more than 18 % of total share as the biggest share holder. The company is founded by James riyadi, one of the richest man in indonesia.

In 2013 the revenue increases 8.2 % up than 2012. It is lower than revenue growth in 2012 which is at 47 %. The healthcare segment is the key driver of revenue growth, its revenue contribution is at 38 % of total revenue.

According to audited annual report, the apartment sub segment of Large scale integrated development Segment is contributing the biggest part of total revenue.

In healthcare, there is siloam hospitals which operates in many big cities in indonesia. Meanwhile, in apartments sub segment, the company has saint moritz apartment as the one of its reputable brand in apartment market.

Meanwhile, the gross profit margin in 2013 is 48 % of revenue, it has been improved compared to gross margin in 2012 which is at 47.3%.

According to audited annual report of 2013, the biggest part of total asset is inventory which is at 68 % of total asset. The capitalized borrowing costs of inventory are about IDR 989.553 million in 2013 and IDR 373.269 in 2012. The majority part of the inventory is land under development which is about 54 % of inventory.

The company issued a global bonds amounting to USD 130,000 thousands in january 2013 and issued amounting to 119,229 thousands in april of 2013. The interest cost of both are capitalized at inventory part.

Majority of its land bank is located at Jakarta area, the company has many project in jakarta and across indonesia as shown at the Table of project.

The company concerns to develop high quality project at the strategic place, this strategy obviously needs expensive cost. Its brands such as saint moritz apartment,kemang village,aryaduta hotel and etc aims middle up customer.

In conclusion, the company has reputable brands in each segment in each market. There are various on goin projects in 2014. The company expects to get better performance in the future.

Forecast

The company is expected improve its margin include gross profit margin. and the most important thing the revenue growth will be risen more in the future.