Puradelta Lestari Tbk (DMAS), a developer of Delta Mas City industrial area, will increase the residential and commercial property contribution for company sales to 10%-15% or IDR 200 billion-IDR 300 billion in 2017. The commercial and residential area development is considered attractive because it provides a higher margin than the margin from industrial land sales.
The company’s marketing sales target in 2017 is predicted to reach IDR 2 trillion, will increase by 33% compare to 2016’s target of IDR 1.5 trillion.
Tondy Suwanto, the Director and Corporate Secretary of DMAS, said that the land value for commercial land reached IDR 7 million-IDR 7.5 million per m2 and IDR 4 million per m2 for residential land. Meanwhile, land value for industrial land reached IDR 2.3 million-IDR 2.6 million per m2.
The contribution of industrial area for total company sales currently reached 97% while from commercial and residential reached 3%. The commercial and residential property business will be the focus of the company in the future along with the decreasing landbank for industrial area. The landbank of DMAS’ industrial area per 30th June 2016 reached 433 ha, while the landbank of commercial area reached 512 ha and residential area reached 703 ha.
“We will develop two residential clusters, while we provide 17 ha of land for budget hotel development at Greenland Square. The residential and commercial project will increase revenue for other than the industrial area,” said Tondy. In the next few years, Deltamas City is targeted to be a township which will be supported by industry.
Mandiri Sekuritas recommended BUY for DMAS with a target price of IDR 350. (*)
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