ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

In this series under Smartkarma Originals, CrossASEAN insight providers <a href="https://www.smartkarma.com/profiles/937" target="_blank" data-saferedirecturl="https://www.google.com/url?q=https://www.smartkarma.com/profiles/937&amp;source=gmail&amp;ust=1546997131129000&amp;usg=AFQjCNEM6J5W9qoLicOCQg406eGu30soUw">AngusMackintosh</a> and <a href="https://www.smartkarma.com/profiles/3145" target="_blank" data-saferedirecturl="https://www.google.com/url?q=https://www.smartkarma.com/profiles/3145&amp;source=gmail&amp;ust=1546997131129000&amp;usg=AFQjCNGeAUtnEDEyoHjpHfSEb4E1G5KE2A">Jessica Irene</a> seek to determine whether or not we are close to the end of the rainbow and to a period of outperformance for the property sector. Our end conclusions will be based on a series of company visits to the major listed property companies in Indonesia, conversations with local banks, property agents, and other relevant channel checks. The final Industrial Estate developer that we will cover in this series is <a href="https://www.smartkarma.com/entities/428" target="_blank" data-smartkarma-citation="entities:428:1">Puradelta Lestari (DMAS IJ)</a>, which has a single industrial estate and integrated township called Kota Deltamas, with a total planned area of 3,181 ha and located in the industrial heartland of  Cikarang, East of Jakarta.The company still has 500ha of this, which can be developed, with 70% of this area sellable. It continues to acquire land and has another 300-400 ha of adjacent land close to its existing estate earmarked for acquisition.Kota Delta Mas has already built a critical mass of Japanese auto companies including Suzuki, Mitsubishi and Honda and more recently Chinese auto-maker Wuling. It is in the midst of negotiating with Hyundai Motor for a large plot within the estate. With the prospect of auto exports increasing, as companies utilise excess capacity for this purpose, Kota Delta Mas stands to benefit as the supply chain expands. It is also well located when the new Patimban Port is completed. This new port in central Java is being developed as an auto export hub.The estate is also a beneficiary of the government mandated policy of moving manufacturing companies from Central Jakarta to Industrial Estates. <a href="https://www.smartkarma.com/entities/6303" target="_blank" data-smartkarma-citation="entities:6303:1">Kalbe Farma (KLBF IJ)</a> has already moved its manufacturing facility to the Kota Delta Mas.After a delay caused by a shift in location, the AEON Mall in Kota Delta Mas will start construction in August this year., with completion two years down the line. This will draw in large numbers of customers and provide a great utility for existing residents. The completion of a new toll road to the south and a nearby station on the Bandung High-Speed Railway nearby will further improve connectivity for Kota Delta Mas over the long term. <a href="https://www.smartkarma.com/entities/428" target="_blank" data-smartkarma-citation="entities:428:1">Puradelta Lestari (DMAS IJ)</a> remains a high-quality proxy for the industrial estate sector, with a strong balance sheet and strong exposure to the auto segment. The share price has run up over the last few months on the expectation of stronger marketing sales this year. As a result, the company is now approaching fair value trading at 1 std above the historical mean on a PBV basis and 2 std on a PER basis. From a NAV perspective, <a href="https://www.smartkarma.com/entities/428" target="_blank" data-smartkarma-citation="entities:428:1">Puradelta Lestari (DMAS IJ)</a> currently trades at a 45% discount to our NAV of IDR431 per share. Our target price of IDR254, which is a blend of PBV and PER, assumes that the stock can take at 2 std deviations above the historical mean, leaves upside from the current price of 7.8%. If we factor in the dividend yield of 3.5%, then the return increases to just over 10%.

In this series under Smartkarma Originals, CrossASEAN insight providers AngusMackintosh and Jessica Irene seek to determine whether or not we are close to the end of the rainbow and to a period of outperformance for the property sector. Our end conclusions will be based on a series of company visits to the major listed property companies in Indonesia, conversations with local banks, property agents, and other relevant channel checks. The final Industrial Estate developer that we will cover in this series is Puradelta Lestari (DMAS IJ), which has a single industrial estate and integrated township called Kota Deltamas, with a total planned area of 3,181 ha and located in the industrial heartland of  Cikarang, East of Jakarta.The company still has 500ha of this, which can be developed, with 70% of this area sellable. It continues to acquire land and has another 300-400 ha of adjacent land close to its existing estate earmarked for acquisition.Kota Delta Mas has already built a critical mass of Japanese auto companies including Suzuki, Mitsubishi and Honda and more recently Chinese auto-maker Wuling. It is in the midst of negotiating with Hyundai Motor for a large plot within the estate. With the prospect of auto exports increasing, as companies utilise excess capacity for this purpose, Kota Delta Mas stands to benefit as the supply chain expands. It is also well located when the new Patimban Port is completed. This new port in central Java is being developed as an auto export hub.The estate is also a beneficiary of the government mandated policy of moving manufacturing companies from Central Jakarta to Industrial Estates. Kalbe Farma (KLBF IJ) has already moved its manufacturing facility to the Kota Delta Mas.After a delay caused by a shift in location, the AEON Mall in Kota Delta Mas will start construction in August this year., with completion two years down the line. This will draw in large numbers of customers and provide a great utility for existing residents. The completion of a new toll road to the south and a nearby station on the Bandung High-Speed Railway nearby will further improve connectivity for Kota Delta Mas over the long term. Puradelta Lestari (DMAS IJ) remains a high-quality proxy for the industrial estate sector, with a strong balance sheet and strong exposure to the auto segment. The share price has run up over the last few months on the expectation of stronger marketing sales this year. As a result, the company is now approaching fair value trading at 1 std above the historical mean on a PBV basis and 2 std on a PER basis. From a NAV perspective, Puradelta Lestari (DMAS IJ) currently trades at a 45% discount to our NAV of IDR431 per share. Our target price of IDR254, which is a blend of PBV and PER, assumes that the stock can take at 2 std deviations above the historical mean, leaves upside from the current price of 7.8%. If we factor in the dividend yield of 3.5%, then the return increases to just over 10%. 

Indonesia Property - In Search of the End of the Rainbow - Part 9 - Puradelta Lestari (DMAS IJ)

<a href="https://www.smartkarma.com/entities/46" target="_blank" data-smartkarma-citation="entities:46:1">Astra International Tbk Pt (ASII IJ)</a> just released car and motorbike sales for January, which showed some signs of recovery, although the increased competition was reflected in lower market share, especially from Mitsubishi and its popular new Expander model. Despite a 22% MoM increase in Honda Motorcycle sales in January, the company's market share declined to 72% from 75% in December.<div class="content-caption">Mitsubishi's Expander is cutting a dash in Indonesia's auto market</div><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/045/110/original/Screen%20Shot%202018-02-21%20at%203.17.53%20PM.png?1519197531" class="editor-image img-responsive" data-smartkarma-image-id="45110"></figure><h2>Signs of life for Astra?</h2>Total auto sales in…

Astra International Tbk Pt (ASII IJ) just released car and motorbike sales for January, which showed some signs of recovery, although the increased competition was reflected in lower market share, especially from Mitsubishi and its popular new Expander model. Despite a 22% MoM increase in Honda Motorcycle sales in January, the company's market share declined to 72% from 75% in December.Mitsubishi's Expander is cutting a dash in Indonesia's auto marketSigns of life for Astra?Total auto sales in…

Astra International - January Car Sales Better but Competition Bites Market Share - Company Update

Hong Kong

Wuling Motors Holdings Limited manufactures motor vehicle engines, parts and special vehicles in China. The Company's activities also include securities dealing, margin financing, money lending and property investment.

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Wuling Motors Holdings (305 HK)

Indonesia Property - In Search of the End of the Rainbow - Part 9 - Puradelta Lestari (DMAS IJ)

In this series under Smartkarma Originals, CrossASEAN insight providers AngusMackintosh and Jessica Irene seek to determine whether or not we are...

Angus Mackintosh

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52-week Range

Market Cap (USDm)

P/E

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Indonesia Property - In Search of the End of the Rainbow - Part 9 - Puradelta Lestari (DMAS IJ)

In this series under Smartkarma Originals, CrossASEAN insight providers AngusMackintosh and Jessica Irene seek to determine whether or not we are...

Angus Mackintosh

Astra International - January Car Sales Better but Competition Bites Market Share - Company Update

Astra International Tbk Pt (ASII IJ) just released car and motorbike sales for January, which showed some signs of recovery, although the increased...

Angus Mackintosh