Good afternoon. Welcome equity holders, bondholders, regulators, and rating agency to first half 2023 Lippo Karawaci earnings, earnings result presentation. I'm Randi Bayu Pratama, as investor relations. Today, I'm with Mr. John Riady as Group CEO. Mr. John will join soon, and also Mr. Daniel Phua as our Group CFO. Mr. Daniel Phua will present about the first the result, followed by the Q&A. If you have questions, please, please drop your question at the Q&A box or raise your hand. We will answer your questions during the Q&A session. Without further ado, please, Daniel, start the presentations. I pass to you, Daniel.
Thank you, Randi. Welcome to all investors to today's earning 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 1Q23, we also reported a positive NPAT, but that was helped largely because of the one-off buyback of bonds. Now, this quarters, there's no one-off corporate events or other unusual business activities. Therefore, the positive NPAT is achieved purely by the business operations alone. 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 the strong performance that the company is showing as a result of improvement in all segments of this business. Let me cover the revenue and EBITDA first in regard to the individual segments. This a bit more details. As you can see, if we compare to one 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 schedules, and the higher margins that is recognized by the marketing sales that's been booked over a year ago.
As you will recall, we closely doubled our marketing sales two 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 a whole, you will notice that EBITDA improved by 40% compared to the year before, ending at close to IDR 2 trillion for one half of 2023. If you look at quarter-on-quarter performances, similarly, we have seen that the Q1 Q2Q has improved from 1Q as well. Real Estate, again, coming back, continue to benefit from the handovers of key projects such as Cendana. The Healthcare has remained relatively flat compared to first quarter of 2023. However, we need to bear in mind that second quarter of 2023 was a Lebaran quarters.
During Lebaran quarter, typically, Healthcare performances will be 10%-15% lower due to the impact of prolonged holidays and so forth. The fact that Healthcare was able to book a stable revenue and EBITDA compared to 1Q 2023, shows that the Healthcare business is continue to grow, expand, as a result of improvement in acuity of Healthcare services being performed, and also, higher throughput, both from inpatients and outpatients. Lifestyle, similarly, we've seen that has benefited from the COVID recovery, and the 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 will note that revenue grew by 5% from 1H 2021 to 1H 2023, on a CAGR basis. EBITDA grew even higher by 11%.
That basically reflects the improvement in the EBITDA margins, that the business is able to optimize its cost structures and improve productivity. You will also notice that the NPAT is at IDR 1.1 trillion for 1H 2023. Even if we exclude, basically, the non-underlying event, underlying NPAT is positive at IDR 16 billion. This is a further breakdown of the result of the underlying NPAT. As mentioned, 1H 2023 is sitting at IDR 16 billion versus negative IDR 450 billion in 1H 2022. This is a close to 100% improvement. It benefited from a 2Q 2023 underlying NPAT of IDR 147 billion. A 200% improvement upon the negative IDR 131 billion in 1Q 2023.
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 directions, be it in the Real Estate segment, in the Healthcare segment, as well as the Lifestyle segment. As mentioned, as a result of that, we are happy to report that on 2Q23, the NPAT, the NPAT proper, is a positive IDR 12 billion. You will notice that the unrealized effects that used to have a quarter-over-quarter drag, has turned positive as a result of the positive movement in the rupiah. Obviously, we have also enjoyed the gain on bond buyback that was booked in 1Q23, totaling at IDR 1.2 trillion. The margins for all segments, I'm happy to report that has improved as well.
Healthcare margin has improved from 21% - 26% in 1H 2023, Real Estate from 20% - 22%, and Lifestyle from 22%-23%. As a result of improved business performances, 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 equipments and expanding on hospital facilities. As a result of improvement in cash flow, we were also to reduce some of the working capital loan that was outstanding.
The liability management, we have has all been completed in 1Q of this year, as mentioned, that has resulted in the successful reductions in the liability outstanding, also a gain of IDR 1 trillion, as reported in the quarter before. Therefore, as a result, we don't have any immediate debt maturity wall. 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 1H 2023, we sold 51 projects in the land of residentials, one in the low-rise, seven in high-rise, and 10 shophouse projects.
We've hit, I mean, 50%, half of our FY 2023 targets, so I think that's definitely very promising. Usually, the second half of the year, especially the third quarters, is an important quarter for marketing sales. 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 a few exciting projects that will be launched in the coming quarters. We have successfully launched the URBN X projects, and the take-up is over 90%. We will be launching further projects in the southern part of LB, later part of this year.
The initial interest has been significant, and we do believe that that would result in a lot of excitements, I think, in the growth of the property segments going forward as well. Just at a glance, again, I won't go through 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 during 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's a continued interest in the type of properties that Lippo Karawaci are launching.
Lippo Karawaci will continue its trend in driving innovations, in coming up with products that will suit different segments of the markets. Be it landed housing, affordable housing, or be it apartments that is targeted to the millennials, that for people who would like to have a kind of inner city living at an affordable price rate. These are the innovations that Lippo Karawaci will continue to push. We thank you for the confidence that the consumers have 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. We're reasonably pleased with the launches of our new products. 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, and, and things like that. We've, 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.
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 performances is flat despite the backlog. If we were to compare to the first half of 2022, revenue improved by close to 20%, EBITDA increased by close to 48%, and the net profit is significant, booking IDR 516 billion for the 1H 2023. This is an over 100% increase, close to 150% compared to 1H 2022. We see improvement in margin as well. The margin, again, if we count margin based on the special non-special revenue, is close to 30% compared to 24% the year before.
Operating cash flow for the Healthcare segment is similarly strong. It's a growth of CAGR of 29% from the pre-pandemic days of 1H 2019. 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 here. If you would look at the 2Q 2019 to 2Q 2023. On a CAGR basis, it's a 35% increase year-on-year from the pre-COVID up to these post-COVID quarters of 2Q 2023. Operational results are similarly strong. Occupancies for hospitals currently sitting at 65% with inpatients and outpatients both maintaining its growth from 1Q 2023 to 2Q 2023.
In addition, we see that the payer mix continued to move towards the private status. For first half 2022, the private sectors contribute 82% of the revenues, and in first half 2023, that increased to 83%. The volume contributions, the increase in revenue is very much driven by the Siloam strategy of driving up the Centers of Excellence and then improving revenue intensities. You will see that for our top six craft groups, I mean, the growth from 2Q 2022 and 2Q 2023 had been significant in areas including maternity, neurology, cardiology, orthopedic, urology, and Oncology. These are the key craft groups or Centers of Excellence or clinical programs that Siloam will 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 strategies that Siloam will continue to push in driving these results going forward. Siloam has also took a different way of looking at its segment. If you recall previously, Siloam had five segments, including what we call ramping up segments. We have now reclassified hospitals in a way to look at the premium, the value seekers, and the BPJS hospitals. Currently, management has planned to basically pilot the operations of each hospitals to be more suited to the particular asset type and the consumer segments that it's 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 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 only has one hospital in Surabaya, and competitors obviously has 4 - 5 hospitals in that regions. We do believe that there is an area whereby we can further capitalize on its growth. 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 the South Jakarta. We do believe that the Kemang area is an attractive market with a strong expat market, and it's a key locations 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, our malls has been improving, the quarter on quarter with regards to the performances. We see that the malls visitors has increased by 30% year-on-year. Currently sitting at 69% compared to 61% in one half of 2022.
Various asset enhancement project, for example, in the Gajah Mada Plaza, we believe will also provide positive momentums towards the second half of the year in terms of occupancies and average revenue for rental. Hotels have similarly continued benefits from the opening up of tourisms and the increased travel activities. We have seen the improved performance in the various segments, including in the Jakarta hotels. 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 RevPAR has been a significant improvement, improving by 39%, 1H in strictly 1H, showing a 37% improvement from 1H 2022 to 1H 2023. Occupancies, I mentioned similarly, has been improving as well. And onto sustainability, LPKR has put strong commitment in its ESG strategies, and we have gotten full commitment from all our group businesses to continue to drive a ESG focus development. The launch of a 2030 sustainability agenda is there to drive all units to hit a common target in regard to decarbonizations in the community health and various good governance practices across the group.
Looking ahead, for Real Estate, there would obviously still be uncertainty associated with macroeconomy environment, inflations, elections coming. We are, we are cautious with the potential headwinds, but we are also encouraged by the successes of the recent launches, which show that there is still a strong demand for affordable housing within Indonesia. 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 here. You will see launches coming in from land residential projects, from low rise, from high rise, industrial plot, commercial plot, cemetery plot, shop houses, land plots. Multiple string firing from the Real Estate segments.
We do believe that continue to help us to achieve the targets that we have promised investors. Healthcare is definitely very promising. I think we have mentioned earlier about the classifications about looking at Healthcare in a different manner. In addition to that, we are also excited by the introductions of the Health Omnibus Law. As a result of the introductions on the 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 will see an improvement from a 6%, down to about 9%. With regard to Healthcare spend, we believe that that will definitely spur more activities in the Healthcare segments.
You will recall in the first quarter of 2023, there was a revision of BPJS tariff, overall, I think that contributed about 8%-9% improvement as a whole for the BPJS tariff in Indonesia. The last revisions in BPJS tariff 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. We believe that that's definitely positive. Along with the reform in BPJS, along with the change in the relaxed taxation and requirements for doctors to practice, we do believe all that will be a positive impact on the Healthcare improvement and growth as a whole.
Siloam will continue to maintain a strategy to focus on the premium segment, as mentioned earlier, to focus on building up its equity Centers of Excellence, in focusing on a patient first approach, in making sure that we provide the patients the utmost quality international care. Healthcare, we are very excited about its prospects going forward. Lifestyle, again, is, is very obvious for those of you going to, to the malls on the weekend. It has continued to recover quarter on quarters. We are excited by the performances in, in some key malls such as Puri. Gajah Mada will be coming out of its asset enhancements initiative towards the end of the year.
All this, we would see sustained and stable growth in the Lifestyle businesses, with regard to hotels, Sky Parking, with regard to malls. We believe that MICE, weddings, corporate events, we have seen an uptick in activities in those areas, we do believe that those will continue going forward as well. That's all from me with regards to the finance and the operational performance. Maybe after, John, if you have any closing remarks.
Yeah, just to add a couple of thoughts on this note of looking ahead. Overall, I think, you know, we've been quite pleased with the performance of the three pillars of our businesses. We think that over the next couple of quarters, it's really more of the same. Really continuing to just focus on the business, continuing to focus on discipline, execute our strategy, and really, in particular, and I see this one first question on the Q&A, really, we're gonna continue to focus on the same segment. If you take a look at what we're doing today, about 60%-70% of our sales or marketing sales is comprises of products that are under IDR 2 billion.
I don't see that changing over the next at least year or 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. Thankfully, in the geographic areas where we have land bank. I think we are well positioned to continue to serve that need really over the next 5 - 7 - 10 years. That's gonna 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, you know, we'll talk about Q3.
We've launched, completed, one launch in mid-July, where there was re- really quite strong demand for what is our first high-rise project in Karawaci. Again, we'll- I'll share more in our, in our next call when we look, when we look at Q1. This is our first high-rise launch. It was oversubscribed by nearly 2 x. We sold approximately 300 units. Admittedly, it's at a lower price point. Again, price points continue to be very important. I think kind of urbanization, and people getting to a point where can afford homes and they want to buy homes, and they want to invest in a long-term home for their own use, will continue to be an important driver of our business's growth.
On Siloam, I think the key is growth, as we continue to solidify our market leadership position, within Siloam. You will see that the number of few locations and land plots that Siloam purchased in Jakarta, will allow 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 secondary cities like Surabaya and, and cities where additionally we were a little bit underrepresented. So very, very exciting uptown there. And again, I think to Daniel. A number of you have reached out asking what we, we, we think about it. I think it's a game changer.
Uh, I think the, the full impact of the law, uh, w-we'll only know once the implementing regulations are in place. Um, so, you know, we're, we're confident that, I think the Minister of, uh, Health, uh, will, will see through, uh, and that hopefully there'll be minimal dilution, uh, from the spirit and, and the law that's been laid out in, in the Healthcare bill. I think we should h-have, uh, we should know in, in maybe about, uh, you know, three months or so. Um, on the malls and, and, and, and, um, uh, hospitality, uh, I think this is the first quarter where, you know, we can very safely say that really, uh, we're, we're beyond COVID, um, and that the business today reflects that.
Also I think by the third quarter of this year, as, 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. So this is pretty much in line with the guidance that we've shared with you over the last, you know, maybe 12 months. That's, that's really a number of points that I wanted to highlight as we look forward across our three businesses. The only other item that I'd mention looking forward is on the refinancing situation, but La'Mere, I know a number of you are following this and have also reached out.
Today, in this call, I won't, I won't be in a position to give you any updates.
I won't be taking any questions on La'Mere. I hope that in the next over the next quarter, I'll be able to do that. Randi, should we maybe open the floor to Q&A?
Yes. I have a question from Robin. This is from Mandiri Sekuritas. Please call Robin.
Hi.
Hello.
I'm run by Randi.
Yes, Randi.
Hi, just wanted to ask on URBAN X. That's 92% take-up rate. Congrats. That's not a bad achievement at all, even if it's not over the full tower. Could you perhaps provide more details on, on, you know, what, what curve this, how long it took to compile up to the 300+ units? Do you see this applying across the, the rest of the high-rise spaces? You know, I mean, high rise over the past few years has been underperforming regardless of price. Thank you.
Yeah. Yeah. No, thanks, Robin. Good to hear from you. This is the project that I was alluding to, just a couple of minutes ago in my comments. Look, I think the reality is, I'll be in a much better position to give you conclusive observations, to market, in our next earnings call. I would say that I am pleasantly surprised with the level of demand that we've seen in our URBAN X project. Our URBAN X project is our sort of high rise. It's probably gonna be about 20 floors, so high rise. High rise, yet affordable, as ones. We sold ... We're gonna do 2 launches for this, for this, for this building.
We've completed the first launch. Approximately 10 floors, 400 units, 300 of which happened in that first launch. It took us about maybe four months to build up the priority passes. I think the, you know, the, the, the people often, I think the, the takeaway is, 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, that, and has been built, and therefore are inventory today, aren't the right products and, and aren't the right price points for what the, what, what the buyers want today.
However, if you take a look at what the value proposition is of this URBN X product, I think it's a very simple proposition, which is the following: If today you wanna live in the Karawaci, Serpong, Alam Sutera area, unless you have about at least 1 billion, if not 1.5 billion rupiah, it's very hard for you to buy, to buy, buy a landed house. Typically, you'd be forced to live in a non you know, sort of not, not in one of these managed infrastructure townships, right? Outside of, you know, Karawaci, Alam Sutera, BSD, and the likes, and Serpong. You have to live maybe another 10-15 kilometers further away from Tangerang, and maybe add another potentially one hour to your daily commute if you went downtown.
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, and the surrounding areas, then you have to live in a high rise. Our high rise where in our URBAN X 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, to stay in this area. Granted, it's an apartment, it's not a landed 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, you know, the whole, the whole deal. That's exciting.
So, you know, the products we've designed are also very different. It's a very unique product. So for those of you 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. From the learnings that we've gotten in this first launch, we've actually tweaked our product a little bit and actually made the products bigger, not smaller. So the price points are actually, to our surprise, I think there's room to be to increase the price points by offering larger products.
That will be part of some of the o- products that we're offering in, in the second launch later on this year. Again, you know, I don't think the high-rise market is one single market. I think we have to look at the high-rise market as comprising many different pockets of demand. 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'll be a very significant part of our overall market and sale in the future. I think it'll be a nice incremental addition to what we're doing.
Thank you.
Yeah, thanks for the, sorry, clarification, Bayu. Perhaps if I can have a follow-up still on UrbanX. The GPMs were expected at around the 30% mark?
Yeah. I think overall, GPM is 30% give or take. Again, it's our, it's our first launch, so we know we're, we're figuring out pricing, et cetera, as we go. Yeah, I think that should be, I think, reasonably what the what the steady state margins will be once everything is completed.
Got it. Thank you, Bayu.
Thank you, Robin. We have another question from Tony Watson. Please speak.
Hi, guys. Can you hear me okay?
Yes, we can hear you.
Yeah, thanks. Just sort of a, a macro industry type question. Work from home and, work from remote, like non-city center locations, is that still a thing in Jakarta? If yes, how is it affecting your strategy?
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. Really, if you take a look at Indonesia as an economy, where a big part of it is either agriculture, manufacturing, and services, that's, that's, you know, labor-intensive services. It's all work from office, it's work from factory, it's work from location. It goes to the nature of the service that they're providing. During COVID, there is a small segment of that, of the more professionalized services, economy, that went work from home. I would say that most companies have gone back to a work from office setup.
Our companies, throughout all of our companies across our group, we've really gone to a work from office, a 100% work from office setup. I think selectively at the board of management, at a very senior level, it's, it's not, 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? I think now, all these remote working tools allow us to be much more productive, given what has always been, the way that people, you know, work and, and, and move and things like that. Generally, I, I, I don't see a significant change.
Yes, I think in some industries, in the financial industries, 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 leases and things like that. I think that there will be an impact, a further negative impact on the office commercial Real Estate market in Indonesia. I should also say that the office commercial Real Estate, Real Estate space has been a disaster even before COVID. 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.
Overall, there's been a supply glut, a glut, even before, even before COVID, which analysts feel that it may, might take another 3 - 5 years, before the supply/demand tightens 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? If yes, how are you adjusting your strategy around that?
Yes, I, I think that is a, a more structural trend, where a lot of companies are moving non-essential services, to locations, outside of Jakarta, so in the greater Jakarta suburban area. 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. So I think that's, that's what you're seeing is consistent with what's happening on the ground. I would, I would say that, that structural trend is a positive development for developers like Karawaci, because primarily our developments are really in that, you know, Karawaci, Cikarang area, where people are outsourcing to.
So today, I think, you know, the only- if you think about it, a lot of people already live out there. Your office is out there, your kids' school is 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 straight all the way downtown in 20 minutes or even 30 minutes, predictably so, every day, I guarantee you many more people would move out. I actually think if you take a lot- 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.
Okay, good. Thanks a lot.
Any more questions from the audience? Okay, yes, I have questions from Eric. Let me allow you to talk. Please, Eric.
Hey, hey, thanks, Randi. Thanks, John and Daniel. I want to know in terms of your, your new estate, marketing sales and pre-sales, like, your business should be the net of a month, but, like, any idea about the recent momentum, if there is any cancellation, from the customer? How would it be in terms of percentage of the gross marketing sales?
As you know, we report marketing sales net of cancellations. That's the industry standard. 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 know, you do a big launch, you'll have about 10% of that sort of cancel, and you've, you've got to recycle that and churn that. That's normal. When, when you have these big launches, there tends to be also more buyers who are buying out of the momentum and the hype. Typically, in events like that, you'll have about a 10% drop-off, that you'll quickly recycle that and, you know, re-re-re-replace those units out to the market.
No, generally, we've seen cancellation rates reasonably stable across the last three, four 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 maybe on, you know, more and more business owners, SMEs. No, we, we've, we haven't seen a material change in the pattern of the cancellations.
Thanks, John. Just one last question. I think it's more for Siloam. Like, right now, can I confirm that the stake held by Lippo Karawaci in Siloam is not pledged? If pledged, what is the amount of the pledge? Theoretically, if you want to get a loan from bank, how would be the LTV ratio for using the Siloam share in getting the bank? Thank you.
We, Lippo Karawaci owns just over 58% of Siloam. As, as we've reported, this is a stake that we've continued to increase over the last two years. I don't believe any is pledged. We have no plans to do so. I've never checked what the LTV would be.
Got it. Thank you. Thanks a lot. Have a nice weekend.
Yeah. Okay, we will have a last question from Manoj Nanwani. Please, Mr. Manoj.
Hi, John. Hi, Daniel.
Hey, Manoj.
Hi. 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 own, like, close to 60%. You see, it's quite a simple calculation, at IDR 15 trillion, and Lippo Karawaci's market cap at IDR 7 trillion, right? What in your in, in your own mind, what is the best way to unlock this value?
Well, I, I'd say that, you're right, Manoj. I think there's a lot of value to be unlocked. I would argue that even Siloam, at where it's currently trading, there's still a lot more upside, if you apply the same, multiple, on the business. 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, you know, what, what I think the real value is. How to unlock? You know, I... That, that's a, 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 sum of the parts of Karawaci.
Because number one, I think there is a little bit of that conglomerate discount that you tend to see in many of these conglomerate holding companies. I think in addition to that, some of the, some of, 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 the sum of the parts basis. You know, you only raise Siloam. In addition to Siloam, this is taken there, you know, there's many other businesses, which I think the market is not only not imputing any value, but actually putting a discount on. We'll see, Manoj. If you have any suggestions, feel free to reach out, personally.
Otherwise, you know, my strategy is to just to continue, continue to improve operations, which is what we've done consistently over the last four years. So you continue to see, you know, 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'll reflect itself in the financials, and 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, you know, four years ago, people or the markets also similarly applied a very significant discount to Siloam.
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. My, my focus, our focus is gonna continue to be on, on the operations of the business and making sure that we, we, we do and we deliver our plan.
Okay, John. Thank you. Thank you, Manoj. I think that's all for today. Thank you, everyone, for joining our first call, 2023 results. See you again on the next earnings calls. Good afternoon, everyone. Bye-bye.
Thank you.