LPN ploughs on with housing development.

By Somluck Srimalee
The Nation
Published on October 10, 2008

Company plans up to eight residential projects next year despite slowdown

LPN ploughs on with housing development.

Lumpini Place Rama IX

Although Thailand's property market is expected to drop in the next year following the fallout from the US subprime cri¬sis, LPN Development will contin¬ue with its launch of six to eight res¬idential projects, worth Bt12 bil¬lion, in the coming year, managing director Opas Sripayak said.

"Next year, the property market may face negative effects from the slowdown in the country's economy but we believe our business will continue to grow at 20 per cent because the property market will have fewer competitors, as a num¬ber of developers have suspended their investments," he said.

Opas said the company had set aside an investment budget of between Bt1.5 billion and Bt2 bil¬lion to create a land bank for the development of new residential projects next year.

The company plans about six to eight residential projects, which will be located in areas around Bangkok, such as Bang Kae, RamIndra Laksi and Rama IX Road.

"Unlike this year, our projects in the coming year will focus on small and mediumsized residences with 800 units to 1,500 units a project to help us boost our sales," he said.

Meanwhile, the company will maintain its presales target at about Bt11 billion after adjusting it from Bt12 billion to Bt11 billion earlier this year.

"We recorded presales of Bt8 bil¬lion in the first nine month of the year and thus believe that we can meet our targets," he said.

About Bt30 million of its pre¬sales came from the fourday event. The Home & Condo Festival 2008, which was held last weekend. The company expects to generate between Bt100 million and Bt150 million in sales from visitors of the event.

The company will also launch the second phase of Lumpini Place Rama IX as part of a plan to boost its sales in the last quarter, he said.

LPN expects presales of Bt11billion by the end of the year, which will add to the company's yearend revenues of Bt7.2 billion.

LPN recorded revenues of Bt3.6 billion and a net profit of Bt609.1 million in the first half of the year, up 22.22 per cent and 24.48 per cent from the same period last year.

The major projects that are expected to generate revenues for the company in the last quarter include Lumpini Place NarathiwatChopraya, Lumpini Place RatchadaTarpra, Lumpini View Ramkhamhaeng 44, Lumpini Condo Town BodindachaRamkhamhaeng and Lumpini Condo Town Ramindra Laksi.

Opas said the company is tar¬geting growth of between 15 per cent and 20 per cent a year until 2010.

It has set a revenue target of Bt10 billion for 2010.

"Our business strategy will focus on boosting sales by developing residential projects matching cus¬tomer lifestyles, such as focusing on locations close to our target groups," he said.

Opas said the company would continue to focus on condomini¬ums and would expand its condominium projects around the capital.

It will concentrate on city con¬dominiums located close to the masstransit system.

LPN's financial results have been analysed by 20 brokerages.

Fifteen of them recommended a "buy" at a target price between Bt5.60 per share and Bt10 per share, three of them recommended a "hold" and the remainder recom¬mended selling the stock.

Globlex Securities, which rec¬ommended buying at a target price of Bt9 a share on October 3, predicts that LPN will benefit from tax incentives.

This will drive the company's sales to meet its revenue target of Bt7.2 billion and netprofit target of Bt1.2 billion by the end of the year, up 11 per cent and 30 per cent, respectively, from last year's performance.

Meanwhile, LPN presales this year will be counted as part of the company's revenues of Bt10 billion for the coming year.

Therefore, LPN will record sales of Bt8.7 billion next year, Globlex Securities said.

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LPN ploughs on with housing development.

Company plans up to eight residential projects next year despite slowdown

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