APLN – unloved & unvalued?

Agung Podomoro Land or APLN, is a Property Company, arguably the Superblock concept founder and the King of Apartments.

The strings of extraordinary saga accompany his rise or fall, which below highlights:

• Podomoro city Jakarta – a slum area turned into flourishing superblock after series of conflicts and struggles, either in court or socially.
• Greenbay Pluit – a muddy fishing area converted to large superblock with marina view (or so the wishful thinking), controversies are part of its story.
• Karawang Industrial land – acquired from SAMP, a company with lawsuits and controversies with various parties on land conflict.
• Pluit City – the biggest controversy and the cause of downfall of the last CEO.

In short, to sleep well while investing in APLN, investor should acknowledge below traits:

1. APLN seems to be a deep value Investor,  acquiring undervalued lands owned by Companies involving in conflicts.
2. Due to that, lawsuits and controversies (bad publication) are part and parcel of APLN.
   If you can’t cope with that, you should not invest in APLN.
3. Why do we even want to invest in such a Company with bad publications?
   As in any cases, the answer is not black or white, but rather it is a gradient.APLN allocating capital to turn undervalued lands into economically beneficial to the Company and while doing it benefits the society in large.
   Isn’t that what Capitalism is all about?
4. Pluit City will be a long and tedious battle.
   If possible, I would rather they let it go, but it fits in APLN’s classic perseverance.
   As in all their tough projects (as described above), they bite the bullets and carry on.
5. Their mindset seems to be, first and foremost selling assets (Condo, Ruko, Offices etc). Hence, the recurring business like Malls, Hotels are generally seen as complementary or secondary in nature.
   Due to that, they will tend to burn money and not managing their recurring assets well financially.

In this writing, I do not focus on Valuation but rather on Qualitative factors.
This is because investing in APLN is not so much on the numbers (which is easier and simpler) but rather on the Investor’s mindset to stomach the pressure of the masses.

In short, investing in APLN is contrarian by nature.
You need to have the courage to walk against the herds.
Because APLN is unloved, but with it, naturally it is also unvalued!

It is rather ironic that APLN is an investor in undervalued Companies, but to me, it seems that APLN itself could be the ultimate undervalued Company.

Once you have embarked in this ship constantly sailing in rough seas (by design I hope), you may wonder with his many projects, which should you focus on?
As a parting gift or homework (depends on how you see it), below table for your food of thought:

Note:
Podomoro City Deli Medan is definitely the major project to put your eyes on.
The 3T potential sales number (APLN stakes) are merely for Condo & Offices.
Put in mind that it will also have a 5 stars Hotel & a high-end mall.

Again, this is a foresight analysis, it carries in itself risk of embarassment to its writer.
Why am I even bother to write such analysis and not keeping it to myself?
The answer is in the wind.

APLN occupied about 20% of my total shares’ market value.
But since my portfolio is 30+% in cash, I am ready for the fall in APLN’s share price.

Fall.Cushion_