Mandiri Sekuritas Ciputra Development: Targets sales of Rp1tn i...

For the next 3 years, the company plans to accumulate some Rp1tn of combined sales coming from 2 new residential projects in Makassar and Pangkal Pinang. So far since its launch in March this year, the Citraland Makassar project has garnered a total of Rp216bn in marketing sales, about 24% of CTRA’s 9M09 of Rp871bn (-28%yoy). Citra Garden Pangkal Pinang, meanwhile will be launched by end of the year with some 50-100 units being rolled out. As of 9M09, CTRA’s marketing sales has lagged behind its FY09 target with an accomplishment rate of 61%, the launching of new projects should help boost sales. For example when the Makassar project was launched in March it instantly generated sales of Rp132bn, 54% of the month’s sales which jumped by close to 4-folds mom. From our standpoint, we are keeping our marketing sales target in FY09 to Rp1.2bn (-16%yoy). Note that revenue realization for these two projects could only occur partially late 2010, thus keeping our targets in 2009 intact. We currently have a buy on the stock, which trades at a 30% discount to our NAV09F.