by Trimegah : ASRI
• ASRI booked 3Q12 bottom line of Rp212bn, grew 17.1% QoQ while surged by 69.8% YoY, 5.6% lower than our 3Q12 earnings estimate.
• 9M12 earnings reached Rp738bn, an outstanding growth of 78.1% YoY, forming 70% of our and 73% of the street’s FY12 earnings. This growth is helped by improvement in 9M12 gross margins of 5.5% YoY to 62.7% and net margins by 2.5% YoY to 43%, on the back of wider margin from land sales (80.3% in 9M12 vs. 63.6% in 9M11).
Top line discussion
• ASRI booked 3Q12 revenues of Rp603bn, jumped by 36.9% QoQ and 89.8% YoY, outperforming our 3Q12 estimate by 21% due to strong land plot (+68% YoY) and house sales (+171% YoY). This robust 3Q12 result allowing 9M12 top line to reach Rp1.7tr (+67.8% YoY), yet in line with our and the street’s FY12 expectations.
ASRI has recently acquired additional land bank of around 80-90ha in Serpong areas (existing around 220-230ha), indicating 7-8 year of development life (with 20-25ha sale pa. assumption). It is worth noting that ASRI has the most premium ASP in Serpong, reaching Rp10mn/sqm in the recent cluster launch (Tiara). Thus, granting ASRI with best NPM among our counters (43% in 9M12 vs. average NPM in our residential counter at 28%). Positive catalyst for 2013 is on additional land bank acquisition (may around 80-100ha in Serpong) and the announcement of GWK master plan (especially on the 30ha planned CBD area in Bali). Total ASRI’s existing land banks as of Sep’12 are as follow: Serpong 297ha, Pasar Kemis 1,443ha, Bali 66ha (GWK 60ha and Sanur 6ha), CBD Jakarta 1ha, and other area 247ha.
We pegged ASRI’s NAV at Rp1.008/share, where Alam Sutera Serpong and Pasar Kemis contribute 50% and 46%; respectively. We have not taken into account GWK’s NAV into our calculation, until ASRI announce the master plan development. We put a HOLD rating on ASRI, due to limited upside (+3.4%) from our target price of Rp600/share (40% discount). The stock is currently trading at 2013PE of 9.1x and 2013PBV of 2.6x.