MIRA INFORM REPORT

Report Date :

06.06.2007

IDENTIFICATION DETAILS

Name :	P.T. POLIDAYAGUNA PERKASA
Registered Office :	Jalan Menteri Supeno No. 11 Semarang, Central Java
Country :	Indonesia
Date of Incorporation :	23 October 1986
Legal Form :	Limited Liability Company
Line of Business :	Biaxially Oriented Polypropylene (BOPP) Film Manufacturing

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	US$ 2,600,000
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear

Name of Company

P.T. POLIDAYAGUNA PERKASA

Address

Head Office

Jalan Menteri Supeno No. 11

Semarang, Central Java

Indonesia

Phone - (62-24) 8441443 (Hunting)

Fax. - (62-24) 8414832

Building Area - 3 storey

Office Space - 600 sq. meters

Region - Industrial Zone

Status - Owned

Factory

Jalan Karimun Jaya

Desa Gedang Anak

Ungaran, Semarang

Central Java

Indonesia

Phone - (62-24) 6921354, 6922835

Fax. - (62-24) 8921382

Land Area - 55,000 sq. meters

Factory Space - 45,000 sq. meters

Region - Industrial Zone

Status - Owned

Date of Incorporation

23 October 1986

Legal Form

P.T. (Perseroan Terbatas) or Limited Liability Company

Company Reg. No.

The Ministry of Justice and Human Rights

No. W9-HT.01.04-42

Dated 1 February 2007

Company Status

Private and Domestic Investment (PMDN) Company

Permit by the Government Department

The Capital Investment Coordinating Board

- No. 369/I/PMDN/1987

Dated 8 July 1987

- No. 727/III/PMDN/1989

Dated 27 September 1989

- No. 348/II/PMDN/1990

Dated 7 August 1990

- No. 361/II/PMDN/1994

Dated 23 December 1994

- No. 105/III/PMDN/1995

Dated 8 March 1995

The Department of Finance

NPWP No. 01.445.937.4-505.000

Related Company

The POLI or POLIPLAS Group Members

CAPITAL AND OWNERSHIP

Capital Structure :

Authorized Capital : Rp. 120,000,000,000.-

Issued Capital : Rp. 80,000,000,000.-

Paid up Capital : Rp. 80,000,000,000.-

Shareholders/Owners :

a. Mr. Hoo Liong Tiauw - Rp. 52,700,000,000.-

Address : Jl Menteri Supeno No. 11

Semarang, Central Java

Indonesia

b. Mr. Suryo Supeno AKA Hoo Min - Rp. 8,060,000,000.-

Address : Jl. Menteri Supeno No. 11

Semarang, Central Java

Indonesia

c. Mr. Hendro Supeno Hadiwirjo - Rp. 8,060,000,000.-

Address : Jl. Menteri Supeno No. 11

Semarang, Central Java

Indonesia

d. Mr. Budi Purnomo - Rp. 8,060,000,000.-

Address : Jl. Menteri Supeno No. 11

Semarang, Central Java

Indonesia

e. Mr. Setiawan Harjono - Rp. 1,200,000,000.-

Address : Jl. Menteri Supeno No. 11

Semarang, Central Java

Indonesia

f. Mrs. Indriani Rochmi - Rp. 960,000,000.-

Address : Jl. Menteri Supeno No. 11

Semarang, Central Java

Indonesia

g. Mr. Toto Sudjarto - Rp. 960,000,000.-

Address : Jl. Menteri Supeno No. 11

Semarang, Central Java

Indonesia

BUSINESS ACTIVITIES

Lines of Business:

Biaxially Oriented Polypropylene (BOPP) Film Manufacturing

Production Capacity

a. BOPP Films - 8,000 tons p.a.

b. OPP Films - 3,000 tons p.a.

Total Investment

a. Equity Capital - Rp. 80.0 billion

b. Loan Capital - Rp. 21.5 billion

c. Total Investment - Rp. 101.5 billion

Started Operation

1990

Brand Name

PROLENE

Technical Assistance

None

Number of Employee

320 persons

Marketing Area

Domestic - 85%

Export - 15%

Main Customer

P.T. POLIPLAS INDAH SEJAHTERA, P.T. POLITAMA PAKINDO and other plastic packaging industries

Market Situation

Very Competitive

Main Competitors

a. P.T. ARGA KARYA PRIMA INDUSTRI Tbk

b. P.T. TRIAS SENTOSA Tbk

c. P.T. INDOPOLY SWAKARSA INDUSTRY

d. P.T. FATRA POLINDO NUSA Tbk

Business Trend

Growing

BANKER, AUDITOR & LITIGATION

Bankers :

a. P.T. Bank MANDIRI Tbk

Jalan R.P. Soeroso No. 2-4

Jakarta Pusat

Indonesia

b. P.T. Bank CENTRAL ASIA Tbk

Jalan Pemuda No. 90-91

Semarang, Central Java

Indonesia

Auditor :

Internal Auditor

Litigation :

No litigation record in our database

FINANCIAL FIGURE

Annual Sales (estimated) :

2004 – Rp. 148.0 billion

2005 – Rp. 165.0 billion

2006 – Rp. 190.0 billion

Net Profit (Loss) :

2004 – Rp. 9.5 billion

2005 – Rp. 11.6 billion

2006 – Rp. 13.2 billion

Payment Manner :

Average

Financial Comments :

Satisfactory

KEY EXECUTIVES

Board of Management :

President Director - Mr. Suryo Supeno, BSc.

Directors - a. Mr. Budi Purnomo

b. Mr. Suhardjiah Kusdiharjo

Board of Commissioners :

President Commissioner - Mr. Hoo Liong Tiauw

Commissioners - a. Mr. Setiawan Harjono

b. Mrs. Indriani Rochmi

Signatories :

President Director (Mr. Suryo Supeno, BSc.) or one of the Directors (Mr. Budi Purnomo or Mr. Suhardjiah Kusdiharjo) which must be approved by Supervisory Board.

CAPABILITIES

Management Capability :

Good

Business Morality

Good

Credit Risk

Average

Credit Recommendation

Credit should be proceeded with monitor

Proposed Credit Limit

Small amount – periodical review

Maximum Credit Limit

US$ 2,600,000.- on the 90 days of payments

OVERALL PERFOMANCE

P.T. POLIDAYAGUNA PERKASA (P.T. PP) was established in Semarang (Central Java) in October 1986 with an authorized capital of Rp. 11,396,000,000.- of which Rp. 6,000,000,000.- was issued and paid up. The company was founded by Mr. Hoo Liong Tiauw, his wife Mrs. Liem Giok Tien Nio and several other members of their family (they are an Indonesian business family of Chinese extraction). The company's notarial act was since revised a couple of times, lastly in 1990 when the authorized capital was increased to Rp. 30,000,000,000.- with the issued and paid up capital amounting to Rp. 20,000,000,000.-. On this occasion the company's shareholders were listed as Mr. Hoo Liong Tiauw, Mrs. Liem Giok Tien Nio, Mr. Surya Supeno AKA (also known as) Hoo Min, Mr. Budi Purnomo BA AKA Hoo Lim, Mr. Hendro Supeno Hadiwirjo, Mr. Setiawan Harjono, Mr. Drs. Purnomo Sidhi, Mrs. Endang Suharti, Mrs. Indriani Rochmi, Mr. Toto Sudijarto, Mr. Ir. Raden Leonardus Soemijantoro MSc., P.T. Bank PEMBANGUNAN INDONESIA (now merged into P.T. Bank MANDIRI), P.T. Bank UPPINDO (liquidated by the government since March 1999) and ASIAN DEVELOPMENT BANK. In December 2004, the authorized capital was increased to Rp. 120,000,000,000.- issued capital to Rp. 80,000,000,000.- entirely paid up. The deed of amendment was made by Mrs. Damar Susilowati, SH., a public notary in Semarang under Company Registration Number W9-HT.01.04-42, dated February 01, 2007.

We note that P.T. PP's founding shareholders, namely Mr. Hoo Liong Tiauw and his wife Mrs. Liem Giok Tien Nio, are also the main founders, prime movers and majority business stake owners of the POLI Group or the POLIPLAS Group. The group's main activities at present are in the plastic bag industry, BOPP film industry and cement and resin bags laminating.

P.T. PP operates under Domestic Capital Investment (PMDN) facilities in biaxially oriented polypropylene (BOPP) film manufacturing. Its plant located on a some 5.5 hectare land in Desa Gedung Anak, Ungaran, Semarang, has been in commercial operation since 1990. The plant is located in the same area as the plant of its sister companies P.T. POLIPLAS INDAH SEJAHTERAH (in plastic woven bag manufacturing) and P.T. POLITAMA PAKINDO (in cement and resin bag laminating industry). P.T. PP's plant started with an initial production capacity of 8,000 tons of BOPP films per year. In 1990 P.T. PP was licensed by the Investment Coordinating Board (BKPM) to expand its plant by stepping up its production capacity by 24,000 tons of BOPP films, 5,000 tons of OPP films and 5,000 tons of polyester films per year. But the plant expansion plan has not been realized and by all indications has been cancelled. In 1994 P.T. PP obtained a BKPM license to expand its plant for the additional production of 3,000 tons of OPP films per year, which expansion unit went into operation in 1996.

Mr. Tedjo, marketing staff of P.T. PP disclosed that around 15% of P.T. PP's products is exported to several Middle East countries while the rest is marketed to various industrial plants including garment, foods, cigarettes, printing, laminating, adhesive manufacturing companies and others by using PROLENE brand. P.T. PP is still classifiable as medium-size company of its kind and its business operation has kept growing within the last five years.

In overall views we find the demand for BOPP film had been rising by 8% to 10% per year in the last five years, in line with the growth of plastic container industries as consumers. The annual demand for BOPP film in Indonesia reaches about 140,000 tons – 150,000 tons, or above the average supply of only about 120,000 tons/year from the five producers. So local producers still have opportunity to provide additional supply of 30,000 tons/year for the local market. Business position of P.T. PP is quite well for some 15% of the product is exported. See the table below :

BOPP film producers, locations and production capacity 2006

No.	Producers	Locations	Production Capacity (Tons/year)
1. 2. 3. 4. 5.	P.T. TRIAS SENTOSA Tbk P.T. ARGHA KARYA PRIMA INDUSTRY Tbk P.T. FATRA FOLINDO NUSA Tbk P.T. INDOPOLY SWAKARSA INDUSTRY P.T. POLYDAYAGUNA PERKASA	Sidoarjo Bogor Tangerang Karawang Semarang	40,000 36,000 20,000 20,000 7,000
T o t a l			123,000

Source : Company Data

Until this time P.T. PP has not been registered with Indonesian Stock Exchange, so that they shall not obliged to announce their financial statement. We observed that total sales turnover of the company in 2004 amounted to Rp. 148.0 billion increased to Rp. 165.0 billion in 2005 and to Rp. 190.0 billion in 2006. The operation in 2006 yielded an estimated net profit at least Rp. 13.2 billion and the company has an estimated total networth at Rp. 110.0 billion. It is projected that total sales turnover of the company will increase at least 8% in 2007. We observe that P.T. PP is supported by financially fairly strong behind it. So far, we have never heard of the company having been black listed by the Central Bank (Bank Indonesia). The company usually pays its debts punctually to suppliers.

The management of P.T. PP is led by Mr. Suryo Supeno, BSc AKA Hoo Min (49) with 15 years of experience in the BOPP Film manufacturing and trade. The management of the company is handled by professional managers having wide relation with private businessmen within and outside the country and with the government sectors as well. We observed that management’s reputation in said business is fairly good. So far, we have never heard that the company’s management involved in a dirty business practice or detrimental cases that settled in the country. The company’s litigation record is clean and it has not registered with the black list of Bank of Indonesia.

PT. POLIDAYAGUNA PERKASA is fairly good for business transaction. However, in view of the unstable economic condition in the country we recommend to treat prudently in extending a loan to the company.

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions