LPN plans to launch up to 8 condo projects
Condominiums to be smaller, allowing faster sales and turnover
LPN Development Plc's managing director Opas Sripayak
Property firm LPN Development plans to launch six to eight condominium projects with a combined market value of up to Bt10 billion next year, despite the significant slowdown in the economy, managing director Opas Sripayak said.
However, the company will reduce its projects to a small or medium size with between 200 and 300 units each, to speed up sales and generate cash flow more rapidly than largescale developments.
"We have to revise the size of our new residential projects to match the country's economic trends, because next year will be slower than this year," he said.
Meanwhile, LPN Development has set aside between Bt1.5 billion and Bt2 billion to buy land next year, on which to develop new residential projects, Opas said.
The company is planning to launch its final project for 2008 at Bang Khae at the end of this month. With a value of Bt300 million, the project will be a pilot development aimed at the middleincome mar
¬ket.It will be LPN
's fifth condomini¬um project this year. The rest were launched in the first half of 2008."We delayed the launch of this lat
¬est condominium project from the third quarter because the costs of construction raw materials had been rising since the second quarter."We cannot set selling prices for our condominium units when the cost of construction raw materialsis fluctuating.
"But now these costs have start
¬ed to fall and are stable, so it's easy for us to estimate our costs and set our condominium prices to match customer demand," he said.Opas said that demand for resi
¬dential projects had suffered a neg¬ative impact from local political uncertainty and the global econom¬ic crisis.In the third quarter of the year, many homebuyers were delaying their decisions to buy residential units. As a result, the company
's pre¬sales in the first 10 months of 2008 reached only Bt8.3 billion, and fell short of its target.So LPN revised downwards its presales target for 2008 from Bt10 billion to Bt9 billion.
LPN Development recorded total revenue of Bt5.7 billion and a net profit of Bt974.1 million in the first nine months of this year, up by 10 per cent and 14 per cent respective¬ly over the corresponding period of 2007.
Eight out of 15 securities firms that reported analyses at www.set¬trade.com in the first week of this month recommended
"buy" for LPN Development's shares, with target prices between Bt3 and Bt6 per share.Most of them said they believed the company's share price was lower than fair value, while the company's pricetoearnings ratio was lower than three times.
The company's financial result had continued to grow while other property firms were faltering.
At the same time, SCB Securities recommended "sell" for LPN Development's shares, with a target price of Bt2.44.
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