MIRA INFORM
REPORT
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Report Date : |
12.01.2011 |
IDENTIFICATION DETAILS
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Correct Name : |
P.T. RIAU ANDALAN PULP & PAPER |
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Registered Office : |
Pangkalan
Kerinci, Kecamatan Langgom, Kabupaten Kampar, |
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Country : |
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Date of Incorporation : |
15.05.1989 |
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Com. Reg. No.: |
No. W7-HT.01.10-2508 |
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Legal Form : |
Limited Liability Company |
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Line of Business : |
Integrated Pulp and Paper Industry |
RATING & COMMENTS
|
MIRA’s Rating : |
B |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Maximum Credit Limit : |
US$ 79,400,000 |
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Status : |
Moderate |
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Payment
Behaviour : |
Slow |
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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 – June 30, 2010
|
Country Name |
Previous Rating (01.04.2010) |
Current Rating (30.06.2010) |
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b1 |
b1 |
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Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Name of Company
P.T. RIAU ANDALAN
PULP & PAPER
company Address
Head Office &
Factory
Pangkalan Kerinci
Kecamatan Langgom
Kabupaten Kampar
Phone -
(62-761) 95529, 95725, 95777
Fax. - (62-761) 95681
Land Area - 45.0 hectares
Office Space - 18.0 hectares
Region - Industrial
Zone
Status - Owned
Branches
a. Jalan Teluk Betung No. 31
Phone - (021) 3923189
Fax. - (021) 3923551
b. UNIPLAZA,
6th Floor, Block
A-1
Jalan Letjend.
Phones - (061) 532532
(Hunting)
Fax - (061) 530833
Date of Incorporation
15 May 1989
Legal Form
P.T. (Perseroan
Terbatas) or Limited Liability Company
Company Reg.No.
a. No.
C2-16.001.HT.01.04.TH'94
Dated 25 October 1994
b. No. W7-01312.HT.01.04.TH.2007
Dated 08 February 2007
c. No. W7-HT.01.10-2508
Dated 28 February 2007
Company Status
Domestic Investment (PMDN) Company
Permit by the Government
Department
The Capital
Investment Coordinating Board
a. No.
21/I/PMDN/1990
Dated 4 January 1990
b. No. 438/III/PMDN/1994
Dated 24 October 1994
Related Company
The RAJA GARUDA MAS Group or the RGM Group Members
CAPITAL AND OWNERSHIP
Capital Structure :
Authorized
Capital -
Rp 3,000,000,000,000.-
Issued Capital - Rp 2,003,204,000,000.-
Paid Up Capital - Rp 2,003,204,000,000.-
Shareholders/Owners :
a.
Asia Pacific Resources International Holding Ltd., - Rp. 1,467,689,000,000.-
Address :
b.
Tanoto Interantional Perkasa Corp. -
Rp. 336,175,000,000.-
Address :
Jl. Jend. Sudirman Kav. 1
c.
P.T. Raja Garuda Mas Pulp Rayon and Paper -
Rp. 199,340,000,000.-
Address : Jl. M.H. Thamrin
Kav. 31
Source: Latest notary
deed, on February 28, 2007
BUSINESS ACTIVITIES
Lines of Business
:
Integrated Pulp
and Paper Industry
Production
Capacity :
First Stage
a. Pulps - 800,000 tons p.a.
b. Chlorines - 50,000 tons p.a.
c. Caustics Soda - 50,000 tons p.a.
Second Stage
a. Pulps - 500,000 tons p.a.
b. Papers -
600,000 tons p.a.
c. Chlorines - 50,000 tons p.a.
d. Caustics Soda - 50,000 tons p.a.
Total
Investment :
First Stage
a. Equity Capital -
Rp 1,417.5 billion
b. Loan Capital -
Rp 1,553.3 billion
c. Total Investment - Rp 2,970.8 billion
Second Stage
a. Equity Capital -
Rp 598.7 billion
b. Loan Capital -
Rp 1,111.9 billion
c. Total Investment - Rp 1,710.6 billion
a. Equity Capital -
Rp 157.0 billion
b. Loan Capital -
Rp 293.0 billion
c. Total Investment - Rp
450.0 billion
Started Operation :
1995
Brand Name :
RIAU PULP
Technical Assistance :
None
Number of Employee :
3,855 persons
Marketing Area :
a. Export - 75%
b. Local - 25%
Main Customer :
Buyers in Asia,
Europe and
Market Situation :
Very Competitive
Main Competitors :
a. P.T. INDAH KIAT
PULP & PAPER Tbk
b. P.T. TJIWI
KIMIA Tbk
c. P.T. LONTAR
PAPYRUS
d. P.T. PINDO DELI
PULP & PAPER
e. P.T. PARISINDO
PRATAMA
f. Etc.
Business Trend :
Declining
BANKER, AUDITOR & LITIGATION
Bankers :
a. P.T. Bank
MANDIRI Tbk.
Jalan Gatoto Subroto Kav. 36-38
b. P.T. Bank BNI Tbk.
Jalan Jend. Sudirman Kav. I
Auditor :
Internal Auditor
Litigation :
No litigation record in our database
FINANCIAL FIGURE
Annual Sales (estimated) :
2007 – Rp.
6,630.0 billion
2008 – Rp. 6,290.0
billion
2009 – Rp.
5,720.0 billion
2010 – Rp.
5,860.0 billion
Net Profit
(estimated) :
2007 – Rp. 620.0 billion
2008 – Rp. 590.0 billion
2009 – Rp. 540.0 billion
2010 – Rp. 550.0 billion
Payment Manner :
Sometime Delay
Financial Comments :
Satisfactory
KEY EXECUTIVES
Board of Management :
President Director - Mr. Rudy Fajar
Directors - a. Mr. Funadi Wongso
b. Mr. Thomas Handoko
c. Mr. Lim Wi Lin
Board of Commissioners :
President Commissioner - Mr. Alagaratnam
Joseph Devanesan
Commissioner - a. Mr. Sia Siew Kiang
b. Mr. Benny Setiawan
Signatories :
President Director (Mr. Rudy Fajar) or
one of the Directors (Mr. Funadi Wongso, Mr. Thomas Handoko or Mr. Lim Wi Lin) which
must be approved by President Commissioner (Mr. Alagaratnam Joseph Devanesan)
or Commissioners (Mr. Sia Siew Kiang and Mr. Benny Setiawan).
CAPABILITIES
Management Capability :
Fairly Good
Business Morality :
Fairly Good
Credit Risk :
Average
Credit Recommendation :
Credit should be proceeded with monitor
Proposed Credit Limit :
Small amount – periodical review
Maximum Credit Limit :
US$ 79,400,000.- on the 90 days
of payments
OVERALL PERFORMANCE
Initially named P.T. RIAU PULP & PAPER, the company was
established in 1989 with an authorized capital of Rp 100,000,000.-, issued and
paid up capital of Rp 20,000,000.-. The original founding shareholders are Mrs.
Tinah Bingei, Mr. Ir. Frits Irawan and Mr. Ir. Yusak Hartono, they are Chinese
Indonesians. In 1992 the company renamed P.T. RIAU ANDALAN PULP & PAPER
(P.T. RAPP) and its authorized capital was raised to Rp 500,000,000,000.-,
issued capital to Rp 100,000,000,000 and the paid up capital to Rp
10,000,000,000.-. In 1994 the authorized capital was again raised to Rp
2,000,000,000,000.-, issued and paid up capital to Rp 1,417,500,000,000.-.
Lastly, in February 2007, the authorized capital was again raised to Rp.
3,000,000,000,000.-, issued and paid up capital to Rp. 2,003,204,000,000.- The
deed of amendment was made by Mrs. Linda Herawati, SH., a public notary in
Jakarta under Company Registration Number W7-HT.01.10-250, dated February 28,
2007. Since then the shareholders of
P.T. RAPP are ASIA PACIFIC RESOURCES INTERNATIONAL HOLDING Ltd., of Bermuda-Berau,
P.T. TANOTO INTERNATIONAL PERKASA Corp., and P.T. RAJA GARUDA MAS PULP RAYN AND
PAPER, both of
P.T. RAPP is a member of the RAJA GARUDA MAS Group or APRIL Group, a large business group headed by Mr. Sukanto Tanoto AKA Tan Sui Hang. The group members have engaged in rubber glove manufacturing, woodworking, oilpalm plantation and palmoil refinery, industrial estate development, banking, office block rental management, iron and steel industry, logging, trading and other business activities.
P.T. RAPP is dealing with pulp industry, managing a plant in
Pangkalan Kerinci, Kecamatan Langgom, Kampar,
P.T. RAPP had been operating commercially since 1995 and now it has an installed capacity of 820,000 tons per year, including its expansion unit. It got a license from BKPM in 1993 to manage Forest Industrial Estate (HTI) of 280,500 hectares in 10 locations in Kampar area, Pangkalan Kerinci, Riau, while its paper manufacturing unit was handed over to its affiliated P.T. RIAU ANDALAN KERTAS (P.T. RAK), its plant is located at Kawasan Industri Kampar Pangkalan Kerinci, Pekan Baru, Riau. The plant started production commercially since mid-1999 with a production capacity of 350,000 tons per year. P.T. RAPP and P.T. RAK got electric energy supply from P.T. RIAU PRIMA ENERGI, also a member of the RGM Group. Some 65% of the products is exported and the rest is sold locally mainly to P.T. RAK.
Mr. Congizio P. Munoz, environmental manager of P.T. RAPP disclosed that from HTI of 280,509 hectares which was effective only 191,700 hectares, conservation area (54,000 ha) and enclave, infrastructure, etc., (34,800 ha). Of the effective land has been planted with acacia (pulp basic stuff) since 1993 and until December 2000 totaled 82,064 ha., while 109,672 ha. will be planted. P.T. RAPP needs acacia wood of 5.85 million cu.m per year to fulfill the needs of pulp plant which the capacity is now 1.3 million tons per year.
Large portion of acacia wood has been supplied by its owned HTI and the other coming from joint concession with P.T. Wananugraha Bima Lestari, P.T. Titian Tata Pelita, P.T. Sumatera Sinar, P.T. Perawang Sukses and P.T. Bukit Raya Maluku.
Beside the above positive news there is also negative information against P.T. RAPP. In July 2000 it was accused to seize 87 hectares land owned by 31 families (KK) of Kerinci, Riau, for industrial forest-estate (HTI) project. Mr. Lukman, a public figure of Pangkalan Kerinci said that the above 87 hectares land have not yet been compensated by P.T. RAPP. He said the people claim for compensation of Rp 10,000.- per m2, while P.T. RAPP will only pay the empowerment compensation of Rp 3.75 million per hectare. The land dispute has yet been settled to date.
Other negative news was that in the end of March 2001, P.T. RAPP was accused to absorb stolen wood from 800 hectares forest-estate owned by P.T. ARARA ABADI (a member of the SINAR MAS Group). The case came from the stealing of acacia mangium wood plantation owned by P.T. ARARA ABADI by persons who claimed themselves under the names of cooperatives in Riau. The stolen wood was sold using a document of Surat Angkutan Kayu Rakyat (People Wood Transporting Permit) and being absorbed by P.T. RAPP. According to Mr. Nur Mahmudi (former Minister of Forestry) the stealing and absorbing of illegal wood had been doing since 1998, causing the state loss at least Rp 400 million because no collecting of Forest Resources Provision Fund. But P.T. RAPP considered that the accusation was very premature and full of business competition.
In May 2001 P.T. RAPP again was alleged to involve in manipulation of Reforestation Fund (DR) and forest contribution (IHH) of Rp 680.0 billion since 1999 to 2000. But Mr. Protasius Daritan, SH, president director of P.T. RAPP refused and the company used its owned fund since the early 1993 and not a single cent received or used the DR fund. The case is not clear, so far, and still under investigation of Attorney General Office.
The company plant utilization has reached 100% with a capacity of 1.8 million per annum out of installed production capacity of 2 million tons p.a. Meanwhile, its paper making plant managed by P.T. RIAU ANDALAN KERTAS (P.T. RAK) has a production capacity of 350,000 tons p.a. Some 75% of P.T. RAPP's export from 2002 to date has been coming from the sales of pulp and the rest is from paper export. She went on to say that the international price of pulp has been rising between US $ 420 to US $ 450 per ton of which the price of the last two years was US $ 300 per ton due to an over supplies.
In September 2005, P.T. RAK planned to merge into P.T. RAPP but the plan has yet to be realized up to this time. In January 2006, P.T. RAPP thirdly gained a Golden Flag Award for its high achievement in Working Saffety and Health Management System Audit 2006 and Zero Accident Award. On 13 March 2006, P.T. RAPP received a certificate of Industrial Forestry Conservation (PHTL) from Indonesian Ekolabel Institution (LEI). That event was attended by Mr. MS Kaban, the Minister of Forestry, Mr. Rachmat Witoelar, the Minister of Environment and Mr. Emil Salim and environmental export.
Up to December 2005, the industrial forestry areas of P.T. RAPP reached 254 thousand hectares consisting of own forestry 150 thousand hectares and the balance are of other business partners. Besides, P.T. RAPP is also collecting timbers of the villagers to meet the rest. Another product of the company is pure honey produced by villagers through community development program. In September 2006, P.T. RAPP allocated a fund of Rp. 30 billion for community development program and environmental conservation. Besides, P.T. RAPP tries to increase the villager’s incomes by involving 9,800 families to plant acacia trees in an area of 26,000 hectares.
Local media Detik News, 15 February 2007 informed that factory of P.T. RAPP in Pangkalan Kerinci Riau was sealed by joint force from National Police and Directorate General of Forestry, as P.T. RAPP was red handed conducted illegal action by buying timbers which was not in compliance with designated sizes. Further on March 2007, Detik News also reported that Regional Police of Riau would conduct open war in illegal logging with two paper companies namely PT. Riau Andalan Pulp and Paper (RAPP) and PT. Indah Kiat Pulp and Paper (IKPP). Regional Police of Riau admitted no fear though the companies were “supported” by Riau Provincial Legislative Council. The matter was conveyed to Chief of Regional Police of Riau Brigadier General Pol. Sutkiptadi in Riau Regional Police Headquarters on Jl. Sudirman, Pekanbaru, Riau, Thursday (1/3/2007)
“Go ahead with defense from them (Provincial Legislative Council of Riau) but we police speak with fact. Both companies violated many provisions concerning its raw materials,” Sutjipta said. He said violations which frequently conducted by both companies is manipulating documents. Type of big timber is categorized as small timber. “This brings loss the state from tax sector, and reforestration,” Sutjiptadi.
Further on August 2007, a local Newspapers “Batam Today” reported that P.T. RAPP and PT. IKPP planned to conduct mass layoff in the end of October 2007. According to plan both these companies would conduct mass layoff to 400 thousand direct workers and 600 thousand indirect workers. The layoff was impact from policy from Riau Regional Police Chief Brigadier General Police Sutjipta in illegal logging war. Many parties including Minister of Forestr, Malam Sambat (MS) Kaban considered that illegal logging eradication had been deviated. It should follow up companies without permit not otherwise.”
In order to seek solution for this layoff plan, Erman Suparno (Minister of Labor and Transmigration would communicate with Police Chief General Police Sutanto and Minister of Forestry MS Kaban. In principle, Ministry of Labor and Transmigration remained to respect the law enforcement taken by Riau Regional Police in illegal logging case. But, he hoped that Police Chief and Ministry of Forestry collectively also sought solution to the layoff plan, as P.T. RAPP and PT IKPP stumbled in illegal logging case.
Further on November 2008, Mr. Rudi Fajar, President Director of PT. RAPP revealed that his company was forced to conduct layoff to thousands its employees. This decision made as there was scarcity in raw material for production. ”If normally we (RAPP) produced 6 to 7 thousands tons. Currently we produced maximum only 3 thousands. We are also forced to layoff the employees,” Rudi Fajar said. During the past two years, he said, his company has reduced timber raw material of Industrial Plant Forest (HTI) significantly.
“Decreasing quantity of production and high production cost due to global downturn. RAPP must take policy for saving by laying off thousands employee,” he continued. On other side, the problem of raw material supply also triggered by different interpretation between government and businessmen toward forestry regulation to be able to settle the problem which may hinder timber supply, and assure legal certain that would support Indonesian pulp industry and papers,” he said. (Source: http://news.okezone.com)
On 16 September 2009, Bisnis
Financial Situation
Until this time P.T. RAPP 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 2007 amounted to Rp. 6,630.0 billion, declined to Rp. 6,290.0 billion in 2008 and declined again to Rp. 5,720.0 billion in 2009 with a net profit of Rp. 540.0 billion. We estimated the total sales turnover in 2010 amounted to Rp. 5,860.0 billion with a net profit of Rp. 550.0 billion. It is estimated the company has an estimated total networth at least Rp. 3,400.0 billion.
We observe that P.T. RAPP is supported by financially strong behind it,
especially Mr. Sukanto Tanoto. According
to Forbes Asia Magazine on March 11, 2010, Mr. Sukanto Tanoto is an one of the ten richest businessmen in
Beside as a suspect of WEB tax embezzling case of Rp. 2.1 trillion. Mr. Sukanto Tanoto was also involved in bad
debt of Bank MANDIRI of Rp. 5.38 trillion.
Total
Liability of RGM Group in Bank MANDIRI
|
Name of Company |
Amount of Bad debts (Rp. billion) |
|
P.T. Dasa Anugerah Sejati |
8.72 |
|
P.T. Inti Indosawit Subur |
2.31 |
|
P.T. Mitra Unggul Pusaka |
11.56 |
|
P.T. Raja Garuda Mas Sejati |
5.74 |
|
P.T. Riau Andalan Kertas |
620.80 |
|
P.T. Riau Andalan Pulp & Paper |
3,339.97 |
|
P.T. Riau Prima Energi |
1,387.23 |
|
T
o t a l |
5,376.41 |
Source: Bank MANDIRI
Since February 2007, P.T. RAPP is headed by Mr. Rudy Fajar (42) as the president
director being assisted by three directors namely Mr. Funadi Wongso (43), Mr.
Thomas Handoko (44) and Mr. Lim Wi Lin (41).
However, we believed that the prime-mover of the company is Mr. Sukanto
Tanoto alias Tan Sui Hang (62), a leading businessman in the country. In March 2010, one of foreign business
magazines (Forbes), reported that Mr. Sukanto Tanoko is one of the ten wealth
businessmen in
Mr. Tanoto has wide relation private businessmen of home and overseas as
well as with the government sectors. As far as business is concerned the
management has never involved in any fraudulent dealings or detrimental cases
being settled in local district court.
They have wide relations with private businessmen within and outside the
country and with the government sector. So far we have never heard that the
board of directors and commissioners of the company involved in business
malpractices or detrimental cases that settled through the court.
In view of the negative factors and unstable economic condition in the
country, we recommend to treat prudently in business transaction and in
extending a loan to P.T. RAPP and other company member of the RGM Group.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.45.32 |
|
|
1 |
Rs.70.54 |
|
Euro |
1 |
Rs.58.70 |
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 |
|
---- |
NB |
New Business |
---- |
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%)
This report is issued at your request without any risk
and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its
officials.