Ah, the sweet scent of nostalgia!
Do you remember the golden days of La Piazza from 2005 to 2015? It was the go-to spot where many of us lounged away hours or ventured out on first dates.
Sadly, it closed its doors, leaving behind a trove of cherished memories and tales in the hearts of its loyal visitors.
Source: Gadinglyfe, Instagram
The good news? Last year, La Piazza swung open its gates once again! And in 2024, it has quickly regained its status as a hot topic and trendy gathering place.
For some of us who once dated here and are now married or even parents, it's a chance to stroll down memory lane with our children, whispering, 'This is where Mom and Dad used to date'
Now, La Piazza isn't just about rekindling old memories; it has transformed into a vibrant venue that offers entertainment for everyone with an array of free concerts and culinary festivals
We cannot overlook the pivotal role played by the developer behind this iconic revitalization, Summarecon Agung.
As one of Indonesia's leading real estate developers, SMRA has not only successfully brought La Piazza back to life but has also demonstrated impressive financial performance.
In 1Q24, SMRA recorded extraordinary earnings of IDR 441 bn, marking a 62% increase yoy and a staggering 291% rise qoq.
Source: Bloomberg
The surge in earnings primarily comes from the residential segment, which achieved IDR 1.1 tn, up 54% yoy and an impressive 99% from the previous quarter—truly remarkable figures!
Moreover, a significant part of this growth also comes from recurring revenue, particularly driven by income from the mall segment, which reached IDR 450 bn. This increase follows the openings of new malls like Summarecon Bandung, Villagio, Gafoy, and La Piazza.
These malls contribute significantly to SMRA's marketing sales, which recorded IDR 809 bn, marking a yoy increase of 24%. Notably, about IDR 500 bn of this came from the PPNDTP project.
Source: Sucor Research
Looking ahead, SMRA is expected to regain momentum thanks to a robust project pipeline, including the launch of three new projects: Genova Phase 3 in Bandung, Shophouse in Makassar, and a residential project in Serpong.
Our analysts anticipate that these three developments will collectively contribute up to IDR 500 bn in revenue by 2027.
We are bullish on SMRA due to its rapidly expanding recurring income portfolios, driven by the successful launch of new malls and revitalization efforts for existing ones, such as La Piazza.
Therefore, we maintain a 'BUY' recommendation with a target price of IDR 810.