ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

In Equity Sales and Research for more than 25 years covering Asian markets. Possesses in-depth knowledge of a wide range of companies, economies, and markets in Asia. Over his career, he has specialised in HK/China and ASEAN markets at various different Investment Banks, most recently heading equities in Indonesia for Bank of America Merrill Lynch in Jakarta for more than three years. Whilst in Jakarta, he produced a well-read daily and weekly product on the Indonesian market, which included company visits, as well as political, economic and sector commentary. A former racing skier, who enjoys ultra-marathons and surfing in his spare time.

ASEAN Insight Provider

The Week That Was in ASEAN@Smartkarma - Indonesian Property Boon, Philippine NPLs, and Drugs

Indonesia Property - In Search of the End of the Rainbow - Part 2 -  Bumi Serpong Damai (BSDE IJ)

Astra International (ASII IJ) - An Auto-Recovery Story with a Golden Digital Twist

Lippo Karawaci (LPKR IJ) - An Audience with the Future

Lippo Karawaci (LPKR IJ) - Reasons to Be Cheerful

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

Thematic (Sector/Industry)

Malaysia Real estate management and development / Thematic (Sector/Industry)

Bank Indonesia (BI) has increased the Loan to Value ratio (LTV) to 100% for residential property loans from 1st March 2021 until 31st December 2021. This policy applies to all types of property, such as landed houses, flats, and shophouses. The previous limit with 85%-95% depending on the property type. A lot obviously depends on an individual bank's willingness to provide such mortgages.
The most active segment in the residential market is around more affordable units priced at IDR1bn-IDR3bn per unit, which are typically 70%-80% are financed by mortgages. 
The second very interesting policy move by BI, and probably even more significant, is to allow developers to take 100% of the mortgage payment upfront when the property is purchased. This is opposed to a gradual release in phases based on stages of completion. This would dramatically improve developers cash flow and working capital. 
We continue to favor the larger developers including <a href="https://www.smartkarma.com/entities/bumi-serpong-damai-pt" target="_blank" data-smartkarma-citation="entities:15498:1" rel="noopener">Bumi Serpong Damai (BSDE IJ)</a>, <a href="https://www.smartkarma.com/entities/ciputra-development-tbk-pt" target="_blank" data-smartkarma-citation="entities:5513:1" rel="noopener">Ciputra Development (CTRA IJ)</a>, and <a href="https://www.smartkarma.com/entities/summarecon-agung-tbk-pt" target="_blank" data-smartkarma-citation="entities:5693:1" rel="noopener">Summarecon Agung (SMRA IJ)</a>.  <a href="https://www.smartkarma.com/entities/lippo-karawaci-tbk-pt" target="_blank" data-smartkarma-citation="entities:3121:1" rel="noopener">Lippo Karawaci (LPKR IJ)</a> is also interesting having completed its financial restructuring and now refocusing on its core property development business. <a href="https://www.smartkarma.com/entities/alam-sutera-realty-tbk-pt" target="_blank" data-smartkarma-citation="entities:2312:1" rel="noopener">Alam Sutera Realty (ASRI IJ)</a> is the highest beta play given its more precarious financial position. 
At the same time, BI has reduced the downpayment on auto to zero also from 1st March 2021 until the end of the year. This should provide a welcome boost to the sector and benefit <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> in particular as the market leader in autos in Indonesia through the distribution of Toyota and Daihatsu brands. We also favor <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> as one of our top picks to play the recovery in the domestic economy.

Bank Indonesia (BI) has increased the Loan to Value ratio (LTV) to 100% for residential property loans from 1st March 2021 until 31st December 2021. This policy applies to all types of property, such as landed houses, flats, and shophouses. The previous limit with 85%-95% depending on the property type. A lot obviously depends on an individual bank's willingness to provide such mortgages.
The most active segment in the residential market is around more affordable units priced at IDR1bn-IDR3bn per unit, which are typically 70%-80% are financed by mortgages. 
The second very interesting policy move by BI, and probably even more significant, is to allow developers to take 100% of the mortgage payment upfront when the property is purchased. This is opposed to a gradual release in phases based on stages of completion. This would dramatically improve developers cash flow and working capital. 
We continue to favor the larger developers including Bumi Serpong Damai (BSDE IJ), Ciputra Development (CTRA IJ), and Summarecon Agung (SMRA IJ).  Lippo Karawaci (LPKR IJ) is also interesting having completed its financial restructuring and now refocusing on its core property development business. Alam Sutera Realty (ASRI IJ) is the highest beta play given its more precarious financial position. 
At the same time, BI has reduced the downpayment on auto to zero also from 1st March 2021 until the end of the year. This should provide a welcome boost to the sector and benefit Astra International (ASII IJ) in particular as the market leader in autos in Indonesia through the distribution of Toyota and Daihatsu brands. We also favor Astra International (ASII IJ) as one of our top picks to play the recovery in the domestic economy.  

CrossASEAN Strategy - BI's New Rules a Fillip for Indonesian Property and Autos?