Research Today: CLSA

With the Asean forum in full drive, we give you the low-down on the three Indonesian companies presenting at today's forum.

SMN (TOWR IJ):
Indonesia's largest independent tower company with 8.5% market share (>4,800 towers; average tenancy of 1.8x)
Income is stable and predictable due to use of long-term leas contracts (5-10yrs)
Customers include the big three of Telkomsel, Indosat and XL Axiata
Limited foreign competition due to government legislation
Earnings are driven by Higher tenancy ('co-location') and tower-portfolio expansion

Gozco Plantation (GZCO IJ):
Pure upstream CPO and palm kernel producer with 30,000 ha of planted estates and 95,000 ha of unplanted land bank
Produced 59,000 tons of CPO and 12,000 tons of palm kernel in FY09, all sold in domestic market at spot rates
Has a reputation for good infrastructure and strong estate management in a fragmented CPO market that also has limited competition
Estimated annual planting capacity of 7,000-10,000 ha will double planted area by 2015.
Management is also open to new estate acquisitions should an attractive opportunity arise

Bumi Serpong (BUMI SD):
Bumi Serpong is Indonesia's largest, fully-integrated, property developer
Grows through its huge land bank in strategic locations with comprehensive infrastructure
Recently raised US$550m to acquire Duta Pertiwi and two affiliated companies, giving a combined land bank of 4,250 ha
A proxy to the Indonesian property sector that is driven by a rising middle class, young population, and low mortgage penetration
While govt passed a restrictive law on presales, it cannot be enforced yet in the absence of an implementing statute