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Introduction & Market Context
PT Lippo Karawaci Tbk (IDX:LPKR) presented its first half 2025 financial results on August 21, showing significant revenue growth amid profitability challenges. The Indonesian property developer’s stock declined 2.02% following the presentation, closing at 97 rupiah, as investors digested the mixed performance metrics.
The company, which operates across real estate, lifestyle, and healthcare segments, reported strong top-line growth but faced margin pressures that impacted overall profitability. With a current market capitalization of approximately $422.58 million and trading at a price-to-book ratio of just 0.21, Lippo Karawaci continues to trade at valuation multiples below many of its peers.
Executive Summary
Lippo Karawaci reported total revenue of IDR 4.117 trillion for 1H25, representing a 35% year-over-year increase. However, EBITDA declined by 13% to IDR 627 billion, indicating significant margin compression. The company achieved IDR 2.47 trillion in marketing sales, reaching 40% of its full-year 2025 target of IDR 6.25 trillion.
As shown in the following business performance highlights, the company saw varied results across its three main segments:
The real estate segment emerged as the primary growth driver, with revenue increasing by 51% year-over-year to IDR 3.46 trillion. Meanwhile, the lifestyle segment, which includes malls and hotels, saw revenue decrease by 12% to IDR 659 billion, though its EBITDA improved by 41% to IDR 213 billion. The healthcare segment through Siloam Hospitals recorded modest revenue growth of 1.5% to IDR 4.73 trillion.
Detailed Financial Analysis
The company’s revenue and EBITDA performance breakdown reveals the contrasting trajectories of its business segments:
Despite the strong revenue growth, Lippo Karawaci’s underlying net profit after tax (NPAT) was IDR 208 billion, with an EBITDA margin of 15%. The company’s cash position improved to IDR 6.501 trillion at the end of the period, up from IDR 5.328 trillion at the beginning, primarily driven by positive cash flow from financing activities.
A significant strategic shift was the company’s move to eliminate all USD-denominated debt, now relying solely on rupiah loans. This transition has substantially reduced interest expenses from IDR 645 billion to IDR 80.74 billion, enhancing financial stability in the face of currency fluctuations.
The company’s liquidity and cash flow position shows the following movement:
Segment Performance
Real Estate
The real estate segment was the standout performer, with marketing sales reaching IDR 2.47 trillion in 1H25, representing 40% of the company’s full-year target. The segment’s revenue grew by 51% year-over-year to IDR 3.46 trillion, while gross profit improved to IDR 1 trillion.
The following slide highlights the key performance metrics of the real estate business:
Lippo Karawaci continues to diversify its product portfolio, balancing premium and affordable housing options. The company showcased its premium home offerings, which include Belmont Homes and Bentley Homes at Lippo Village, The Allegra at Lippo Cikarang, and Blackslate at Waterfront City:
Recognizing the growing demand for affordable housing, the company is also expanding its offerings in this segment with projects like Treetop Livin, Gold Livin, Bronze Livin, and Quartz Livin at Park Serpong:
Lifestyle
The lifestyle segment, which includes Lippo Mall Indonesia and Aryaduta Hotels, faced challenges but showed signs of operational improvement. As the largest mall operator in Indonesia with 59 malls across 39 cities, the company reported mall occupancy reaching 84.1%, with average footfall exceeding 11 million visitors per month.
The following chart illustrates the malls’ performance metrics:
Healthcare
The healthcare segment, operated through Siloam Hospitals, delivered stable performance with revenue of IDR 4.73 trillion, representing a modest 1.5% year-over-year increase. More impressively, the segment’s EBITDA margin stood at 21%, with net profit growing by 42% to IDR 476 billion.
The financial performance of the healthcare segment is illustrated below:
The segment reported strong operational metrics, with approximately 1 million outpatient visits and 76,000 inpatient admissions during the period. The occupancy rate stood at around 62%, indicating room for further growth.
Strategic Initiatives
Lippo Karawaci outlined several strategic initiatives aimed at driving future growth. In the real estate segment, the company is expanding its product portfolio to include more affordable housing options across Indonesia, while maintaining its premium offerings.
For the lifestyle segment, the focus remains on improving mall occupancy and enhancing the tenant mix to drive footfall. The company has been introducing new stores and brands, including Dust and Samsung (KS:005930), to strengthen its retail offerings.
In healthcare, Siloam Hospitals is focusing on attracting premium patients and expanding its network. The company highlighted the successful launch of Da Vinci (EPA:SGEF) Xi robotic surgery, with 11 procedures completed in 1H25, demonstrating its commitment to advanced medical technologies.
Forward-Looking Statements
Looking ahead, Lippo Karawaci is targeting IDR 6.25 trillion in marketing sales for the full year 2025, with expectations of improved sales in the second half. The company anticipates that recent reductions in Bank Indonesia’s interest rates will stimulate consumer spending in the real estate sector.
As outlined in the company’s future prospects:
Group CFO Pav Hendi Santoso expressed optimism during the earnings call, stating, "We continue to see that our business to be quite resilient," and noting, "We are hopeful that marketing sales will improve in the second half of the year."
However, the company faces ongoing challenges, including soft economic conditions affecting consumer spending, margin compression due to apartment deliveries, and competitive pressures in the real estate market. Despite these challenges, Lippo Karawaci’s improved debt structure and cash position provide a stronger foundation for navigating the current economic environment.
Full presentation:
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