MIRA INFORM REPORT

Report Date :

05.04.2011

IDENTIFICATION DETAILS

Name :	P.T. BAJAJ AUTO INDONESIA
Registered Office :	Menara Imperium 29^th Floor Suite A, Jalan H.R. Rasuna Said Kav. 1, Setiabudi, Jakarta Selatan, 12980
Country :	Indonesia
Date of Incorporation :	03.07.2006
Com. Reg. No.:	No. AHU-80183.AH.01.02.TH.2008
Legal Form :	Limited Liability Company
Line of Business :	Trading, Import and Distribution of Motorcycle and Components

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$ 2,236,000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – December 31, 2010

Country Name	Previous Rating (30.09.2010)	Current Rating (31.12.2010)
Indonesia	b1	b1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Name of Company

P.T. BAJAJ AUTO INDONESIA

Company Address

Head Office

Menara Imperium 29^th Floor Suite A

Jalan H.R. Rasuna Said Kav. 1

Setiabudi

Jakarta Selatan, 12980

Indonesia

Phones - (62-21) 8281 787 (Hunting), 8307 648

Fax - (62-21) 8307 615

Building Area - 32 storey

Office Space - 200 sq. meters

Region - Commercial Building

Status - Rent

Factory (Assembling)

Jalan Angsana Block A 9 No. 8

Kawasan Industri Delta Silicone

Lippo Cikarang, Bekasi, 17550

West Java

Indonesia

Phones - (62-21) 8990 1677 (Hunting)

Fax - (62-21) 8974 638

Land Area - 12,000 sq. meters

Building Space - 8,200 sq. meters

Region - Commercial Building

Status - Rent

Date of Incorporation

3 July 2006

Legal Form

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

Company Reg. No.

The Ministry of Law and Human Rights

- No. C-22753.HT.01.01.TH.2006

Dated 3 August 2006

- No. AHU-80183.AH.01.02.TH.2008

Dated 31 October 2008

Company Status

Foreign Investment (PMA) Company

Permit by the Government Department

a. The Department of Finance

NPWP No. 02.519.856.5-055.000

b. The Department of Industry & Trade

TDP No. 090313550480

Dated 30 August 2006

c. The Capital Investment Coordinating Board

No. 631/I/PMA/2006

Dated 8 June 2006

Related Companies :

a. BAJAJ AUTO LIMITED, India (Motorcycle Manufacturing and Investment Holding)

b. P.T. ABDI RAHARJA (Trading and Distribution of Motorcycle)

c. P.T. ABDI SEJAHTERA (Trading and Distribution of Technical Equipment)

CAPITAL AND OWNERSHIP

Capital Structure :

Authorized Capital : US$ 12,500,000.-

Issued Capital : US$ 12,500,000.-

Paid up Capital : US$ 12,500,000.-

Shareholders/Owners :

a. BAJAI AUTO LIMITED - US$ 11,875,000.-

Address : Mumbai Pune Road

Akurdi, Pune 411035

India

b. Mr. Teguh Boentoro - US$ 625,000.-

Address : Jl. Villa RT. 001/ RW. 008

Kelurahan Jati Padang, Pasar Minggu

Jakarta Selatan

Indonesia

BUSINESS ACTIVITIES

Lines of Business :

a. Trading, Import and Distribution of Motorcycle and Components

b. Motorcycle Assembling

Production Capacity :

a. Motorcycle (2 wheeler) - 28,000 units p.a.

b. Trading, Import and Distribution of

Motorcycle and Components

Total Investment :

a. Equity Capital - US$ 12.5 million

b. Loan Capital - US$ 43.0 million

c. Total Investment - US$ 55.5 million

Started Operation :

a. July 2006

b. Assembling 2007

Brand Name :

BAJAJ

Technical Assistance :

BAJAJ AUTO LIMITED of India

Number of Employee :

115 persons

Marketing Area :

Local - 100%

Main Customer :

a. P.T. BAJAJ ANDALAN SAKTI

b. P.T. BAJAJ FONTANA PERKASA MOTOR

c. Other Distributors

Market Situation :

Very Competitive

Main Competitors :

a. P.T. ASTRA HONDA MOTOR

b. P.T. INDOMOBIL SUZUKI INTERNATIONAL

c. P.T. KAWASAKI MOTOR INDONESIA

d. P.T. TVS MOTOR INDONESIA

e. P.T. YAMAHA MOTOR INDONESIA

f. Etc.

Business Trend :

Growing

BANKER, AUDITOR & LITIGATION

Bankers :

a. P.T. Bank SWADESI Tbk

Jalan Samanhudi No. 37

Jakarta Pusat

Indonesia

b. P.T. Bank MANDIRI Tbk

Plaza Mandiri

Jalan Jend. Gatot Subroto Kav. 36-38

Jakarta Selatan

Indonesia

c. CITIBANK N.A.

Citi Bank Tower

Jalan Jend. Sudirman Kav. 54-55

Jakarta Selatan

Indonesia

Auditor :

Internal Auditor

Litigation :

No litigation record in our database

FINANCIAL FIGURE

Annual Sales (estimated) :

2008 – Rp. 154.0 billion

2009 – Rp. 162.0 billion

2010 – Rp. 170.0 billion

Net Profit (estimated) :

2008 – Rp. 10.8 billion

2009 – Rp. 11.3 billion

2010 – Rp. 13.0 billion

Payment Manner :

Average

Financial Comments :

Satisfactory

KEY EXECUTIVES

Board of Management :

President Director - Mr. Krishna Srinevasa Grihapathy

Directors - a. Mr. Vijayaraghavan Srinivasan

b. Mr. Sampath Kumar Krishnan

Marketing Manager - Mr. Apong Arfiansyah

Board of Commissioners :

President Commissioner - Mr. Rakesh Sharma

Commissioners - a. Mr. Kevin D’sa

b. Mr. Teguh Boentoro

Signatories :

President Director (Mr. Krishna Srinevasa Grihapathy) or one of the Directors (Mr. Vijayaraghavan Srinivasan or Mr. Sampath Kumar krishnan) which must be approved by Board of Commissioner.

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$ 2,236,000 on 90 days D/A

OVERALL PERFORMANCE

P.T. BAJAJ AUTO INDONESIA (P.T. BAI) was established in Jakarta on July 03, 2006 with an authorized capital of US$ 12,500,000 wholly issued and paid up. The company was founded by BAJAJ AUTO LIMITED of India as foreign partner and Mr. Teguh Boentoro as local partner. The deed of amendment was made by Mrs. Aulia Taufani, SH., was approved by the Ministry of Law and Human Right in its Decision Letter No. C-22753 HT.01.01.TH.2006, dated August 03, 2006. The company notary deed has been changed and in September 2008 the board of directors and the board of commissioner had been changed (see profile of this report). The latest revision of notary documents was made by Mr. Sutjipto, SH., a public notary in Jakarta and was approved by the Ministry of Law and Human Rights in its decision letter No. AHU-80183.AH.01.02.TH.2008 dated October 31, 2008.

We observe the local partner namely Mr. Teguh Boentoro is an Indonesian businessman of Chinese descent, where he is also business owners of P.T. ABDI RAHARJA engaged in trading and distribution of motorcycle and P.T. ABDI SEJAHTERA engaged in trading and distribution of technical equipment.

P.T. BAI was established in the frame work of Foreign Investment (PMA) facility to deal with trading, import and distribution of motorcycle, component and parts. The company has been in operation since July 2006 by import of motorcycle from India in CBU (Completely Built-Up) by using BAJAJ brand. Besides, the company also import of motorcycle component and spare parts from India. To increasing the marketing and operation, P.T. BAI has been built and manages factory in Lippo Cikarang, West Java. The assembling plant located at Jalan Angsana Raya Block A 9 No. 8, Kawasan Industri Delta Silicon, Lippo Cikarang, Bekasi, West Java on a land of 12,000 sq. meters. Then the plant engaged in motorcycle (India motorcycle) assembling industry having been in operation since 2007.

The whole products of motorcycles are imported from India in SKD (Semi Knock Down) form of which later assembled in their above factory. The motorcycles produced by the company consist of several types including BAJAJ XCD 125 DTS-Si; PULSAR 180 DTS-Si and PULSAR 200 DTS-Si. Whole products of the company are locally marketed using BAJAJ and PULSAR brands. Mr. Apong Arfiansyah, marketing manager of the company explained the above motorcycle distributed by various dealers such as P.T. BAJAJ ANDALAN SAKTI, P.T. BAJAJ FONTANA PERKASA MOTOR and other dealers in Indonesia. He also added that the dealer and after sales services station of BAJAJ Motorcycle has been reached more than 75 units spreading in big cities in Indonesia. We observe the operation of P.T. BAI has been growing and developing well in the last three years.

Generally, demand for motorcycles and components and spare parts of motorcycles has kept on increasing in line with the development of the production of motorcycles in the country. One of factors supporting the growing demand for motorcycles is the role of financial and banking institutions seriously backing up the motorcycle purchasing with installment system. With a little Down Payment (DP), the public can obtain the motorcycles. The competition is very tight on account of many motorcycle producers operating in the country including Chinese motorcycles offered with cheaper prices. However, Japanese motorcycles still dominate the local motorcycle markets like HONDA controls 60% of the market segment, SUZUKI (19%), YAMAHA (16%), KAWASAKI (2%) and others 3%. Business position of P.T. BAI is well enough because its product BAJAJ motorcycle controls 3% local market segment within the last three years. The development of motorcycle production in the country in detail is as illustrated in the following table:

Indonesia’s Production and Wholesales of Motorcycle, 2005-2010*

Year	Production (AISI) (Units)	Wholesales (Units)
2005	5,113,487	5,089,426
2006	4,459,000	4,470,722
2007	4,722,000	4,713,895
2008	6,264,265	6,280,799
2009	5,884,000	5,882,000
2010*	5,600,000	5,650,000

*) Projected

Source: AISI

Until this time P.T. BAI has not been registered with Indonesian Stock Exchange, so that they shall not obliged to announce their financial statement. The management of P.T. BAI is very reclusive towards outsiders and rejected to disclose its financial condition. We observed that total sales turnover of the company in 2008 amounted to Rp. 154.0 billion rose to Rp. 162.0 billion in 2009 increased to Rp. 170.0 billion in 2010 and projected to go on rising by at least 5% in 2011. The operation in 2010 yielded an estimated net profit of at least Rp. 13.4 billion and the company has an estimated total networth of at least Rp. 131.0 billion. We observe that P.T. BAI is supported by foreign partner with has financially strong and sound behind it. So far, we did not heard that 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. BAI is led by Mr. Krishna Srinevasa Grihapathy (44) a professional manager of India with experience in motorcycle assembling and trading. The company's management is handled by professional staff in the above business. They have wide relations with private businessmen within and outside the country. So far, we did not hear that the management of the company being filed to the district court for detrimental cases or involved in any business malpractices. The company’s litigation record is clean and it has not registered with the black list of Bank of Indonesia. P.T. BAJAJ AUTO INDONESIA is sufficiently fairly good for business transaction.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.65
UK Pound	1	Rs.71.93
Euro	1	Rs.63.24

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	Capability to overcome financial difficulties seems comparatively below average.	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

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%)

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