Reuters: Hot Stocks: STOCKS NEWS INDONESIA-Citi initiates Alam Sutera with 'buy'

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STOCKS NEWS INDONESIA-Citi initiates Alam Sutera with 'buy' Sep 14th 2012, 05:44 Fri Sep 14, 2012 1:44am EDT Citi Research started coverage of property developer PT Alam Sutera Realty Tbk with a 'buy' rating, saying it was the most liquid property stock in Indonesia with an attractive price-to-earnings ratio. "The stock's 34 percent plunge in five months in reaction to a Bali acquisition that makes up just 4 percent of NAV is a good entry point, in our view," Ferry Wong, Citi's head of research in Indonesia, said in a note on Friday. "ASRI looks attractive at 8.6x 12E PE and is the most liquid property stock in Indonesia with a 3-month ADT of US$4.5m," Wong said and set a target price of 660 rupiah on the stock. The broker said ASRI's landbank in Serpong was its key asset and property demand had been strong there, with the ASP growing at a 44 percent CAGR in full-year 2007-2012 earnings. "Alam Sutera's eight-month pre-sales this year reached 2.8 trillion rupiah ($292.35 million), or 80 percent of the company's full year target and 65 percent of our forecast," Wong noted in the report. The company continued to enjoy 47 percent of net margin in first-half this year, much higher than the peer average of 30 percent, he said. Potential upside catalysts for the company include strong execution in Jakarta's outskirts Pasar Kemis, master plan announcement of Bali-based project Garuda Wisnu Kencana and acquisition of additional landbank in Serpong, the broker said. The real estate firm's shares were up 5.43 percent at 485 rupiah while the broader index was up 2.02 percent. 1238 (0538 GMT) ($1 = 9,577.5 rupiah) (Reporting by Andjarsari Paramaditha) Link this Share this Digg this Email Reprints

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