PT Lippo Karawaci Tbk (LPKR) Earnings Call Transcript & Summary

Good afternoon. Welcome, equity holders, bondholders, regulators and rating agency to First Half 2023 Lippo Karawaci Earnings Results Presentation. I'm Randi Prathama, Head of Investor Relations. Today, I am with Mr. John Riady, as Group CEO. Mr. John will join soon. And also Mr. Daniel Phua, our Group CFO. Mr. Phua will present about the first -- the results followed by the Q&A. [Operator Instructions] Without further ado, I'll ask Mr. Daniel to start the discussion. I pass to you, Daniel.

Thank you, Randi. Welcome to all investors to today's earnings call. I'm very excited to share this quarter's results with you because it would represent a quarter whereby Lippo Karawaci is able to report a positive NPAT without any one-off event. I mean you will notice that in 1Q '23, we also reported a positive impact, but that was helped largely because of the one-off buyback of bonds. Now this quarter, there's no one-off corporate events or other unusual business activities. Therefore, the positive impact is achieved purely by the business operations alone. And then we think that this is a significant turning point for the Lippo Karawaci Group. We do believe that this trend will continue, going forward as well. It basically demonstrates strong performance that the company is showing as a result of improvement in all segments of the business. Let me cover the revenue and EBITDA. First, in regard to the individual segments, there's a bit more detail. As you can see, if we compare to 1 half 2022, all segments have improved. The largest improvement has obviously came from the Healthcare segment, whereby EBITDA improved by 31% or about IDR 439 billion compared to the year before. Other than Healthcare, we saw that Real Estate and Lifestyle has similarly improved as well. Real Estate obviously is benefiting from the handovers that is on schedule, and the higher margins that is recognized by the marketing service that's been booked over a year ago, so as you will recall, we close to doubled our marketing sales 2 years ago. And a lot of their marketing sales are getting delivered now. And therefore, they are resulting in positive movement in our revenue and EBITDA. As [ you'll recall ], you will notice that EBITDA improved by 40% compared to the year before, ending at close to IDR 2 trillion for 1 half of '23. If you look at quarter-on-quarter performances, similarly, we have seen that the Q-on-Q 2Q has improved on 1Q as well. Real Estate, again coming back, continue to benefit from the handovers of key projects such as Cendana. And Healthcare has remained relatively flat compared to first quarter of 2023. However, we need to bear in mind that second quarter of 2023 was in the [ barren ] quarters. And during the [ barren ] quarter, typically, Healthcare performances will be 10% lower due to the impact of the prolonged holidays and so forth. So the fact that Healthcare was able to book a stable revenue and EBITDA compared to 1Q '23 shows that the Healthcare business is continuing to grow, expand as a result of improvement in equity of Healthcare services being performed and also higher throughput both from inpatients and outpatients. Lifestyle, similarly, we've seen that have benefited from the COVID recovery, and EBITDA has improved by 3% compared to the quarter before. This translated into a very promising trend for the group businesses as a whole. You would note that revenue grew by 5% from 1 half '21 to 1 half '23 on a CAGR basis. EBITDA grew even higher by 11%. That basically reflects improvement in the EBITDA margins that the business is able to optimize its cost structures and improved productivity. You also noticed that NPAT is IDR 1.1 trillion of 1 half '23. Even if we exclude basically the nonunderlying event, underlying NPAT is positive at 16 bps. This is a further breakdown of the results of the underlying NPAT. As mentioned, 1 half '23 is sitting at IDR 16 billion versus negative IDR 450 billion in 1 half of '22. This is close to 100% improvement. It does -- and it benefited from a 2Q '23 underlying NPAT of IDR 147 billion, a 200% improvement upon the negative IDR 131 billion in 1Q '23. I think the positive movement in the underlying NPAT is a strong indicator that the underlying business of the Lippo Karawaci Groups are trending in the right direction, be it in the Real Estate segment, in the Healthcare segment as well as the Lifestyle segment. And as mentioned, as a result of that, we are happy to report that on 2Q '23, the NPAT proper is a positive IDR 4 billion. You will notice that the unrealized FX that used to have a quarter-on-quarter drag has turned positive as a result of the positive movement in the rupiah. And obviously, we have also enjoyed the gain on bond buyback that was booked in 1Q '23, totaling IDR 1.2 trillion. The margins for all segments, I'm happy to report that has improved as well. Healthcare margin has improved by 21% to 26% in 1 half '23, Real Estate from 20% to 22% and Lifestyle from 22% to 23%. As a result of improved business performance, we also saw improvement in cash flow. Operating cash flow is a positive IDR 157 billion compared to a negative IDR 834 billion from the year before. Again, this is a testament of the ability for the business segments to generate positive cash flow and to have positive collections. Investing cash flow is mainly as a result of further investment from Siloam to invest in its medical equipment and expanding on hospital facilities. And as a result, improvement in cash flow, we were also to reduce some of the working capital loan that was outstanding. Liability management, we have -- has all been completed in 1Q of this year. And as mentioned, that has resulted in the successful reductions in the liability outstanding and also a gain of IDR 1 trillion as reported in the quarter before. And therefore, as a result, we don't have any immediate debt maturity [ wall ]. And if you look at other factors like debt-to-equity ratios,and also the hedgings that we have, they also put the company at a very strong position. Moving into the segments. For the Real Estate segment in 1 half of '23, we sold 51 projects in landed residential, 1 in the low-rise, 7 in high-rise and 10 shophouses projects. We've hit 50%, I mean half of our FY '23 targets. So I think that's definitely very promising. Usually, the second half of the year, especially the third quarter, is an important quarter for marketing sales. And therefore, we do believe that we are well on track to be able to hit the full-year targets provided earlier. There will be certain exciting project -- a few exciting projects that will be launched in the coming quarters. We have successfully launched the URBNx projects, and the take-up is over 90%. And we will be launching further projects in the southern part of [ LV ] later part of this year, and the initial interest has been significant. And we do believe that, that would result in a lot of excitement, I think, in the growth of the property segments, going forward, as well. Just at a glance, again, I won't go through it one by one, these are some of the projects that we have handed over during this first half of the year, and resulting in the positive revenue and EBITDA that has been recognized. Moving on, these are some of the new property development projects that was introduced between the 1Q and 2Q of this year. As you can see from the results, the take-up rate has been phenomenal and -- which shows that there is continued interest in the type of properties that Lippo Karawaci's are launching. Lippo Karawaci will continue its trend in driving [ ambitions ] in coming up with products that will suit different segments of the market, be it landed housing, affordable housing, albeit [ through our ] partners that is targeted to the [ building houses ] that for people who would like to have a kind of inner-city livings at an affordable price rate. These are the innovations that Lippo Karawaci will continue to push, and we thank you for the confidence that the consumers has shown to the group, and we believe that this will continue to support marketing sales, going forward. John, would you like to say a few things on the property and marketing sales aspect?

Well, thank you, Daniel. I share Daniel's views, overall. As Daniel has shared, so far this year, we're tracking pretty much our full-year guidance. And we're reasonably pleased with the launches of our new products. And as I've continued to share over the last couple of quarters, really, our strategy is to continue to diversify our product base, be it price points, geographic location, sizes and things like that. So we've got a full slate of launches set for the third quarter. The third quarter, as all of you know, is the most important quarter for us in the Real Estate business. So we're really looking forward to capitalizing on the third quarter and finishing the second half as strongly as the first half has been.

All right. Thank you, John. Moving on to Healthcare. Healthcare, similarly, has been exciting. As you know, 1Q to 2Q, the performance is flat, despite the [ Lebaran ]. If we were to compare to the first half of '22, revenue improved by close to 20%, EBITDA increased by close to 48%. And the net profit is significant, booking IDR 516 million for the 1 half of '23. This is an over 100% increase, close to 150% compared to 1 half of '22. And we see improvement in margin as well. The margin, again, the we count margin based on the non-specialty revenue, is close to 30% compared to 24% the year before. Operating cash flow for the Healthcare segment is still really strong. It's a growth of CAGR of 29% from the pre-pandemic base of 1 half '19. And I think if you look at the quarterly EBITDA growth as well, I mean, compared to pre-COVID -- sorry, slight typo, this is close to 335% increase, if you would look at the 2Q '19 to 2Q '23. On a CAGR basis, is a 35% increase year-on-year from the pre-COVID up to these post-COVID recorders of 2023. Operational results are similarly strong. Occupancies for hospitals currently sitting at 65%, with inpatients and outpatients, both maintaining its growth from 1Q '23 to 2Q '23. In addition, we see that the [ payer ] mix continue to move towards the [ private sector ] for 1 half '22. The private sectors contributed 82% of the revenues. And in 1 half '23, that increased to 83%. The volume contributions, the increase in revenue is very much driven by the Siloam strategy of driving up the center of excellence and therefore improving revenue intensities. You will see that for our top 6 craft groups, I mean, the growth from 2Q '22 and 2Q '23 have been significant in areas, including maternity, neurology, cardiology, orthopedics, urology and oncology. And these are the key craft groups or centers of excellence or clinical programs that Siloam continue to focus on. We do believe that the current strategy of basically having more focus on the single specialist areas has bear fruit in the improvement in Siloam's result, and that is the strategy that Siloam will continue to pull in driving these results, going forward. Siloam also took a different way of looking at this segment. If you recall, previously, Siloam had 5 segments, including what we call ramping-up segments. We do -- we have now only classified hospitals in a way to look at the premium, the value seekers and the BPJS hospitals. And the currently management has a plan to basically tailor the operations of each hospitals to be more suited to the particular [ archetype ] and consumer segments that these are targeting. We do believe that over time that this will improve efficiencies and thereby improving productivities and margins of the businesses. We also want to share with you some of the new hospitals that the Siloam is planning. Siloam, currently, has a plan to double down on its premium segments and to drive more growth in its premium segments. That is evidenced in some of the new hospitals that Siloam will be opening. Siloam has purchased a piece of land in Surabaya, Manyar. Currently, as you will [ recall ], Siloam has 1 hospital in Surabaya, and competitors obviously have 4 to 5 hospitals in that regions. And we do believe that is an area where we can further capitalize on this growth. And so the plan is on track to open a hospital in Surabaya. In addition, a piece of land has been purchased in Kemang Antasari.This will become the new flagship hospitals for Siloam in South Jakarta. We do believe that the Kemang area is an attractive market with a strong expand market, and it's a key location for us to build a brand new flagship to basically -- as a showcase for the highest standard of healthcare in Indonesia. Moving on to Lifestyle, malls have been improving quarter-on-quarter with regard to the performances. We see that the malls visitors have increased by 30% year-on-year, so currently sitting at 69% compared to 61% in 1 half of '22. Various asset enhancement project, for example, in the Gajah Mada Plaza, we believe, will also provide positive momentum towards the second half of the year in terms of occupancies and average revenue for rental. Hotels are similarly continued benefits from the opening up of tourism and increased travel activities. We have seen the improved performance in the various segments, including in the Jakarta hotels, and we do expect this trend will continue, with average room rate increasing by 14% year-on-year and occupancy improving by 6% as well year-on-year. Along with that, we see that the hotel EBITDA has been a significant improvement by 39%. [ Or what happens is 3 to 1 half ] showing a [ 37% ] improvement for 1 half of '22 to 1 half of '23. Occupancy, I mentioned, similarly, has been improving as well. And on to sustainability, [ Ketut Wijaya ] has put strong commitment in these ESG strategies, and we have gotten full [ confidence ] from all of the businesses to continue to drive ESG-focused development. And the launch of 2030 Sustainability Agenda is there to drive all units to heed the common target in regards to decarbonization, community health and various good governance practices across the group. Looking ahead, for Real Estate, and there would obviously still be uncertainty associated with the macroeconomic environment, inflations, elections coming. We are cautious with the potential headwinds, but we are also encouraged by the successes of the recent launches. We showed that there is still a strong demand for affordable housing within Indonesia. And therefore, we are optimistic about the launches that are planned for the second half of this year. As John has mentioned, our strategy has remained unchanged. We will continue to focus on diversity, looking at different price points. You will see launches coming in from land residential projects from low-rise, from high-rise industrial plots, commercial plots, cemetery plots, shophouses, land plots. So multiple stream firing from the Real Estate segment, and we do believe that will continue to help us to achieve the targets that we have promising business. Healthcare is definitely very promising. I think we have mentioned earlier about the classifications about looking at Healthcare in a different manner. But in addition to that, we are also excited by the introductions of the Healthcare Omnibus Law. As a result of the introductions on Omnibus Law, I think there will be a few key benefits for the Healthcare segment as a whole. First of all, the government budget in healthcare, we've seen an improvement from 6% down to about 9%. I mean we got the healthcare spend. We believe that, that will definitely spur more activities in the Healthcare segment. You will recall in the first quarter of 2023, there was a revision of BPJS tariffs. And overall, I think that contributes about 8% to 9% improvement as a whole for the BPJS tariff in Indonesia. The last revision in BPJS was about 6 years ago. As a result of the Omnibus Law revisions, it is stipulated that such revision will happen once every 2 years, going forward. So we believe that, that's definitely positive. Along with the reform in BPJS, along with the change in the relaxation in the requirements for doctors to practice, we do believe all that will be a positive impact on the Healthcare improvement and growth as a whole. Suma continue to maintain its strategy to focus on the premium segment, as mentioned earlier, to focus on building up this equity center of excellence and focusing on a patient-first approach in making sure that we provide the patients the utmost quality international care. So Healthcare, we are very excited about is [ posing ] forward. Lifestyle, again is very obvious for those of you going to the mall that we can -- it has continued to recover quarter-on-quarter. We are excited by the performances in some key malls such as [ Puri ]. Gajah Mada will be coming out of this asset enhancement initiatives towards the end of the year. And all this, we would see sustained and stable growth in the Lifestyle businesses with regard to hotels, [ skaing ] with regards to the malls. And we believe that [ MICE] , weddings, corporate events, we have seen an uptick in activities in those raise. We do believe that those will continue going forward as well. That's all for me with regard to the finance and operational performance. Maybe John, if you have any closing remarks.

Yes. Just to add a couple of thoughts on this note of looking ahead. Overall, I think we've been quite pleased with the performance of the 3 pillars of our businesses. And we think that over the next couple of quarters, it's really more of the same. So really continuing to just focus on the business, continuing to focus on discipline, execute our strategy. And in particular, and I see this one -- first question on the Q&A, really, we're going to continue to focus on the same segment. And so if we can look at what we're doing today, about 60%, 70% of our sales or marketing sales are -- comprises of products that are under IDR 2 billion. So I don't see that changing over the next at least year or so. And so that will continue to be our focus. We think there's a huge unmet demand for housing from end users at those price points. And thankfully, in the geographic areas where we have a land bank, and so I think we are well positioned to continue to serve that need really over the next 5 to 7 to 10 years. And so that's going to continue to be our focus as far as Real Estate goes. We will continue to be creative and try to push the boundaries here and there. In the next earnings call, we'll talk about [ Q3 ]. We've launched -- completed one launch in mid-July, where there was really quite a strong demand for what is our first high-rise project in Karawaci. So again, I'll share more in our next call when we look at Q3. But this is our first high-rise launch. It was oversubscribed by nearly 2 times. We sold approximately 300 units. Admittedly, it's at a lower price point. And so again, price points continue to be very important. But I think kind of urbanization and people getting to a point where -- and afford homes, and they want to buy homes, and they want to invest in the long-term home for their own use will need to be an important driver of our business' growth. On Siloam, I think, [ our goal ] is to continue to solidify our market leadership position within Siloam. You will see that the number of few locations and land [ plus ] in Siloam purchase in Jakarta, will continue -- will allow the Siloam to continue to strengthen and solidify its market share and presence and network across the entire Greater Jakarta area. In addition to that, we're also looking to penetrate and have a stronger presence in the [ contestable ] Surabaya ad cities where additionally, we were a little bit [ unrepresented ]. So very, very exciting upfront there. I mean, yes, [Audio Gap] I think to a longer. A number of what we think about it, I think it's a game changer. I think the full impact of the law, we'll all know once implementing regulations are in place. So we're confident that the minute of health we will see through. And that hopefully, there will be [ minimal ] dilution from the spirit and the law that's been made out in the healthcare bill. I think we should know in maybe about 3 months or so. On the malls and hospitality, I mean this is the first quarter where we can very safely say that really we're non-COVID and that the business reflects that. And obviously, I think by the third quarter of this year, as we're speaking, I think, we're finally back to pre-COVID levels. And I see that by the fourth quarter of this year, we'll exceed pre-COVID levels. And so this is pretty much in line with the guidance that we've shared with you over the last maybe 12 months. So that's really a number of points that I wanted to highlight as we look forward across our 3 businesses. The only other item that I'd mention, looking forward, is on the refinancing situation at [ Lamira ]. I know a number of you are following this and have also reached out. Today, in this call, I won't be in a position to give you any updates. And so I won't be taking any questions on [ Lamira ]. But I hope that in the next -- over the next quarter, I'll be able to do that. With that, Randi, should we maybe open the floor to Q&A?

Yes, I have a question from Robin, PT Mandiri Sekuritas.

I just wanted to ask on URBNx, so that's 92% take-up rates, congrats. That's not a bad achievement at all. Or even if it's not over the full tower, could you perhaps provide more details on what [ proves ] this? And how long it [ pick up ] all to 300-plus units? And do you see this applying across the [ rates ] of the high-rise base? Is -- I mean, high-rise rates, over the past few years, has been underperforming for [ project ].

Yes. No, thanks. Good to hear from you. So this is the project that I was alluding to just a couple of minutes ago in my comments. And so look, I think the reality is, I'll be in a much better position to give you conclusive observations market in our next earnings call. But I would say that I am pleasantly surprised with the level of demand that we've seen in our URBNx project. And our URBNx project is our sort of high-rise, it's probably going to be about 20 floors, so high-rise, high-rise yet affordable . And so we sold -- we're going to do 2 launches for this building. We've completed the first launch of approximately 10 floors, 400 units, 300 of which happened in that first launch. It took us about maybe 4 months to build up the priority passes. But I think the people often -- people -- I think the takeaway is the following. People often say that the high-rise market is weak. I think that's not necessarily true. I think the high-rise market has been weak in the recent past because a lot of the products that are in the market and has been built and therefore, our inventory today, aren't the right products and aren't the right price points for what the buyers want to do. However, if you take a look at what the value proposition is of this URBNx product, I think it's a very simple proposition, which is the following. If today, you want to live in the Karawaci, area, unless you have about at least IDR 1 billion, if not IDR 1.5 billion, it's very hard for you to buy a land house. And so typically, you'd be forced to live in a non -- sort of not in one of these managed infrastructure townships, right? So outside of Karawaci and the likes and so on. Or you have to live maybe another 10, 15 kilometers further away from [ Bangram ] and may add another potentially 1 hour to your daily commuting to and from downtown. And so the value proposition that we're offering is if you don't have IDR 1 billion or IDR 1.5 billion to buy a landed property in some of these townships in the Karawaci and the vicinity and the surrounding areas, then you have to live in a high-rise. And so our high-rise in our URBNx products are priced at exactly that. It's priced at just IDR 500 million to IDR 600 million to IDR 700 million, which allows you to stay in this area. Granted, it's an apartment, it's not a land house, but you've got really good infrastructure, and you're actually located right at the center of CBD Karawaci, right next to the mall, great public transport, the whole deal. So that's exciting. And so the products we've designed are also very different. It's a very unique product. And so for those of you who are -- who happen to be in Jakarta, reach out, we'd love to take you out and show you the show units in Karawaci. I really think it's a well-designed product. And from the learnings that we've gotten in this first launch, we've actually tweaked up our product a little bit. And actually, with the products bigger not smaller. And so the price points are actually -- to our surprise, I think there's room to be to increase the price points that we'd be offering to larger products. And so that will be part of some of the products that we're offering in the second launch later on this year. So again, I don't think the high-rise market is 1 single market. I think we have to look at the high-rise market as comprising many different pockets of land. And if we focus on what the customer needs and wants, I think there's a demand for it. Having said that, I don't think it will be a very significant part of our overall marketing sales in the future. I think it will be a nice incremental addition to what we're doing.

All right. John, if I can have a follow-up still on URBNx. Are the [ GPMs ] little expected at around the 30% mark?

Yes. I think overall, [ GPM ] is 30%, give or take. Again, it's our first launch, so we're figuring out pricing, et cetera, as we go. But yes, I think -- that should be, I think, reasonably what the steady-state margins will be, once everything is completed.

Thank you, Robin. We have another question from [ Connie ] Watson. Please [ Audio Gap]

Just sort of a macro industry type question, work-from-home and work-from-remote, like non-city center locations, is that still a thing in Jakarta? And if yes, how is it affecting your strategy?

So I would say that -- if you take a look at Indonesia on a macro level, I would say that the work-from-home trend is not a material factor because really, if you take a look at Indonesia as an economy, a big part of it is either agriculture, manufacturing and services. And so that's labor-intensive services. And so it's all work-from-office, work-from-factory, it's work-from-location. It goes to the nature of the service that they're providing. Now during COVID, there is a small segment of that, of the more professionalized services economy that went work-from-home. I would say, most companies have gone back to a work-from-office setup. And our companies -- throughout all of our companies across our group, we've really gone to our work-from-office, 100% work-from-office setup. I think selectively at the Board of Management, at a very senior level, it's not entirely back, but I would say that it's never been anyways at that level. It's never been fully work-from-office anyways, right? But I think now all these remote working tools allow us to be much more productive, given what has always been the way that people work and move and things like that. So generally, I don't see a significant change. But yes, I think in some industries, in the financial industry, in the consulting industries, the law firms, I think you'll see some downsizing in office space over time as leases get renewed, I think people will downsize these and things like that. And so I think there will be an impact, a further negative impact on the office, commercial, real estate market in Indonesia. But I should also say that the office, commercial as the real estate space has been a disaster even before COVID. And so I don't think that where the industry is today is a result of work-from-home. I think the work-from-home is another factor -- a negative factor affecting the industry. But overall, there's been a supply glut even before COVID, which analysts feel that it might take another 3 to 5 years before the supply/demand patches up a little bit.

Right. Just picking up on that last point. One thing we noted last time we were in Jakarta a couple of months ago was the trend of companies moving their offices out of CBD areas, particularly Jakarta, and locating them in suburban clusters. Is that a trend that you think is here to stay? And if yes, how are you adjusting your strategy around that?

Yes, I think that is a more structural trend, where a lot of companies are moving nonessential services to locations outside of Jakarta, so in the Greater Jakarta suburban area. And that makes sense from a cost point of view, but also from a recruitment point of view because a lot of your workers at that level would be living not in Downtown Jakarta, but actually exactly in those suburbs. And so I think that's what you're seeing is consistent with what's happening on the ground. I would say that, that structural trend is a positive development for developers like Karawaci because primarily our developments are really in that Karawaci Cikarang area, where people are outsourcing, too. And so today, I think the only -- if you think about it, a lot of people already live out there, your office is out there, your kids' schools are out there, you get better, cleaner air, more space. Really, the only impediment to more people moving out is traffic. If, let's say, there were an LRT, MRT that taking you from Karawaci [ Cikarang ] all the way to downtown in 20 minutes, I think 30 minutes predictably, you saw every day, I guarantee you many more people would move out. So I actually think if you look at a lot of these more medium-term, long-term factors, it does work in favor of a lot of the developers with land bank in those areas.

Any more questions from the audience? Okay. Yes, I have questions from Derek. Let me allow you to talk, Derek.

I want to note in terms of your [ U.S. ] marketing sales of resale in the next month. But any idea about the recent momentum, if there is any cancellation from the -- how it'd be in terms of percentage of the gross marketing sales?

So as you know, we report marketing sales net of cancellations, not the industry standard. And for any marketing sales you see is net of cancellations over the last 12 months. We have not seen a noticeable increase in cancellations. Typically, when you have launches, you do a big launch. You'll have about 10% of that sort of canceled, you've got to recycle and churn that, that's normal because when you have these big launches, there are -- there tends to be also more buyers who are buying out of the momentum and the high. And so typically, in events like that, you'll have about a 10% dropoff, and you'll quickly recycle that, replace those units out to the market. But no, generally, we've seen cancellation rates reasonably stable across the last 3, 4 years. We might have seen a little bit of an increase during COVID, especially in areas like Cikarang that are more sort of professionals as opposed to be more and more business owners, SMEs. But no, we haven't seen a material change in the pattern of the cancellations.

Just one last question. I think it's more for Siloam. Right now, can I confirm that the spec held by Lippo Karawaci in Siloam is not [ cash ]? What was the amount of [ cash ]? Theoretically, we want to get a loan from the bank, how would be the LTV venture for using the [ strong ] share in getting that [ back ]?

We, Lippo Karawaci, owns just over 58% of Siloam. As we've reported, this is a stake that we've continued to increase over the last 2 years. I don't believe any is pledged. We have no plans to do so. I've never checked what the LTV would be.

Okay. We will have a last question from Manoj [ Manwani ].

This is a bit of a strategic question, John. If I were to look at the market cap of Siloam, it's like IDR 25 trillion, and you're like close to 60%. You see it's quite a simple acquisition at IDR 15 trillion, and Lippo Karawaci's market cap is IDR 7 trillion, right? What in your own thing in -- what is the best way to unlock this revenue?

Well, I'd say that -- you're right, Manoj. I think there's a lot of value to be unlocked. And I would argue that even Siloam, where it's currently trading, is there's still a lot more upside if you apply the same multiple on the business. But I'm pleased to see that over the last 12 months, I think the market is finally recognizing a little bit more value in Siloam towards what I think the real value is. How to unlock? That's a good question, Manoj. I think we'll see. I think, frankly, at the moment, the reality is the market still applies a discount. It applies a discount to the overall sort of some of the parts of Karawaci because, number one, I think there is a little bit of that conglomerate discount that we tend to see in many of these conglomerate, holding companies. But I think in addition to that, some of the Lippo Karawaci's specific issues and challenges in the past have created too much complexity for the markets to value Karawaci on a sum of the parts basis. And you only raised Siloam. But in addition to Siloam, there's many other businesses, which I think the market is not only not including any value, but actually putting a discount on. So we'll see, Manoj. If you have any suggestions, feel free to reach out personally. Otherwise, my strategy is to just continue to improve operations, which is what we've done consistently over the last 4 years. So you can continue to see each of our businesses, hopefully, doing better and better operationally, to be more disciplined, to just be more consistent in what we're doing. And I'm confident that over time, that will reflect itself in the financials that the market will recognize more and more of that value as well in the same way that they have for Siloam. If you go back 4 years ago, people or the markets also similarly applied a very significant discount to Siloam. But as we've continued to perform better and better, more consistently over time and the financials gradually more and more reflecting that reality as well, we see that the market also recognize and appreciates that. So my focus, our focus is going to continue to be on the operations of the business and making sure that we do and we deliver our plan.

Thank you, Manoj. I think that's all for today. Thank you, everyone for joining our first half 2023 results, and see you again on the next earnings call. Good afternoon, everyone. Bye-bye.

Thank you.