MIRA INFORM REPORT

Report Date :

02.05.2011

IDENTIFICATION DETAILS

Name :	THE SINAR MAS GROUP

Registered Office :	Wisma Indah Kiat, A Building, 2^nd Floor Jalan Raya Serpong Km. 8 Tangerang, Benten 15310 Banten Province

Country :	Indonesia

Date of Incorporation :	Early 1960’s

Legal Form :	Group Company or Unlimited Liability Company

Line of Business :	Agribusiness and Food Division

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate

Payment Behaviour :	Unknown

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

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

Company name

The SINAR MAS Group

Registration data

1. Year of Establishment

-Early 1960’s

2. Business Headquarter

- Jakarta

3. Legal Status

- Group Company or Unlimited Liability Company

4. Legalization

- Not Required

5. Government Permits

- Not Required

6. Capitlaization

- Not Required

7. Founders and Owners

a. Mr. Eka Tjipta Widjaja (Oei Ek Tjhong)

b. Mr. Teguh Ganda Widjaja (Oei Tjie Goan)

c. Mrs. Sukmawati Widjaja (Oei Sin Hoa)

d. Mr. Indra Widjaja (Oei Pheng Lian)

e. Mr. Muktar Widjaja (Oei Siong Lian)

f. Mr. FrankleDjafar Widjaja (Oei Piak Lian)

g. Mr. Franky Oesman Widjaja (Oei Jong Nian)

8. Business Operation Area

a. Through-out Indonesia

b. Singapore, Malaysia, Philippines, China, Japan, South Korea, India, Thailand, Taiwan,

Australia, Saudi Arabia, Bahrain, Belgium, Canada, France, Italy, the USA, etc

9. Business Activities

- Agribusiness and Food Division

- Pulp and Paper Product Division

- Developer and Real Estate Division

- Financial Services Division

- Energy and Mining Division

- Telecommunication

- Trading and Other Activities

10. Ultimate Investment Holding

- P.T. SINAR MAS TUNGGAL

- P.T. PURINUSA EKAPERSADA

- P.T. EKACENTRA USAHAMAJU

- P.T. PARAGA ARTAMIDA

- P.T. SINAR MAS MULTIARTHA Tbk

- P.T. DIAN SWASTIKA SENTOSA Tbk

11. Number of the Group Members

- 256 Companies

12. Major Members of the Group

a. P.T. INDAH KIAT PULP & PAPER Tbk. (Pulp and Paper Industry)

b. P.T. Pabrik Kertas TJIWI KIMIA Tbk. (Pulp and Paper Industry

c. P.T. DUTA PERTIWI Tbk (Property Management and Development)

d. P.T. SMART Tbk., (Oil Palm Plantation and Palm Oil Refinery)

e. P.T. SINARMAS MULTIARTHA Tbk. (Multi Financing Service)

f. P.T. PINDO DELI PULP & PAPER (Pulp and Paper Industry)

g. P.T. LONTAR PAPYRUS PULP & PAPER (Pulp and Paper Industry)

h. P.T. DIAN SWASTIKA SENTOSA Tbk. (Energy and Mining Development)

13. Top Figures and Executives

a. Mr. Teguh Ganda Widjaja (Oei Tjie Goan)

b. Mr. Indra Widjaja (Oei Pheng Lian)

c. Mr. Muktar Widjaja (Oei Siong Lian)

d. Mr. FrankleDjafar Widjaja (Oei Piak Lian)

e. Mr. Franky Oesman Widjaja (Oei Jong Nian)

14. Contact Addresses

The SINAR MAS Group

Wisma Indah Kiat, A Building, 2^nd Floor

Jalan Raya Serpong Km. 8

Tangerang, Benten 15310

Banten Province

Phones - (62-21) 531200001/2/3

Fax - (62-21) 53120268

Email - app-procurementsp@app.co.id

Jakarta Office

BII Plaza Tower II, 5^th Floor

Jalan M.H. Thamrin No. 51

Jakarta 10350

Phones - (62-21) 3925660 (hunting)

Fax. - (62-21) 3925788

Contact Persons

a. Mr. Teguh Ganda Widjaja

President Director

b. Mr. Agustian R. Partawidjaja or Yan Partawidjaja

Director and Public Relation Manager

OVERALL PERFORMANCE

The SINAR MAS Group is a very large-size private business group was established in the 1960-s by Mr. Eka Tjipta Widjaja AKA Oei Ek Tjhong AKA Ng Tjo Tjhong and his family members. They are Indonesian family businessmen of Chinese extraction. Initially, parent company of the SINAR MAS Group is C.V. SINAR MAS, a private company was established in 1960-s by Mr. Eka tjipta Widjaja and his brother-in-law Mr. Eddy Pirrih, another Indonesian businessman of Chinese extraction. The company some time later renamed P.T. SINAR MAS TUNGGAL and its legal status changed to P.T. (Perseroan Terbatas) or Limited Liability Company. Since the time, the shareholders of P.T. SINAR MAS TUNGGAL are controlled by Mr. Eka Tjipta Widjaja, his wife Mr. Triani Dewi Lasuki and his sons and daughter. namely Mr. Teguh Ganda Wijaya AKA Oei Tjie Goan (67), Mrs. Sukmawati Widjaja AKA Oei Sin Hoa (60), Mr. Indra Widjaja AKA Oei Pheng Lian (59), Mr. Muktar Widjaja AKA Oei Siong Lian (57), Mr. Frankle Djafar Widjaja AKA Oei Piak Lian (55) and Mr. Franky Oesman Widjaja AKA Oei Jong Nian (53).

Initially the main activity of the SINAR MAS Group consisted of dealing in copra, coconut oil, cooking oil and technical goods. Up to the early 1970-s the group’s activities grew moderately, marked by ups and downs. But since then, the group’s business made faster and steady progress. The group has launched a vertical business expansion by building many coconut oil and cooking oil refineries, developing oilpalm plantations, building a fleet of tankers to transport cooking oil, etc. The group’s activities have also expanded horizontally, particularly into the paper industry, chemical industry, financial institutions, real estate development, and other fields. Generally, we can divide the activities of the group into six fields of business operations, namely:

a. Agribusiness and Food Division

In 1983 the SINAR MAS Group and the SALIM Group or the LIEM SIOE LIONG Group (the country’s biggest business group led by Mr. Soedono Salim AKA Liem Sioe Liong) established the SINAR MAS INTI PERKASA Group or the SMIP Group, with main activities in the edible oil refinery industry. The SMIP Group originally controlled six cooking oil and margarine refineries, located in Manado (North Sulawesi), Surabaya (East Java), Jakarta and Medan (North Sumatra). Besides that, the SMIP Group also managed a G.I. sheet plant in Manado, a shipping company and a big-size trading company. The above cooking oil and margarine plants had a production capacity of about 540,000 tons per year. Their products were marketed under the Bimoli, Simas and Filma trademarks.

But since the end of 1991 the SINAR MAS Group and the SALIM Group separated their operations in the SMIP Group. The refineries located in Surabaya and Medan were taken over by the SINAR MAS Group and the companies in Jakarta and Manado were acquired by the SALIM Group. There were signs of a rift having developed between the two giant groups, particularly between the sons of Mr. ETW on one hand and the sons of Mr. Soedono Salim on the other. Mr. Soedono Salim is the principal founder and biggest business stake owner of the SALIM Group. But the two sides have in the end been able to resolve their differences amicably.

The operations of the SINAR MAS Group to remain very big in the industry of processing cooking oil, margarine, stearic acids, fatty acids, glycerin and other palmoil-based products. The SINAR MAS Group is still the biggest producer of cooking oil in the country at present.

b. Pulp and Paper Products Division

From the early 1970-s the SINAR MAS Group had planned to branch out into the paper industry. They founded P.T. Pabrik Kertas TJIWI KIMIA which is now one of the biggest national private paper plants in the country. The company’s big-size plant in Sidoarjo, East Java, produces industrial papers. The company has been continuously expanding operations and possessing its own pulp plant. The group now also controls a large portion of the shares of P.T. INDAH KIAT PULP & PAPER, a joint venture with a Taiwanese business group. The joint company owns a big-size paper plant in Tangerang and a pulp plant in Riau. Then, the SINAR MAS Group took over part of the shares of P.T. LONTAR PAPYRUS, a private company manufacturing industrial papers.

Initially, Pulp and Paper division of the SINAR MAS Group is controlled by an holding company namely ASIA PULP AND PAPER (APP), a sister company of the SINAR MAS Group. In Indonesia, APP controls P.T. INDAH KIAT PULP & PAPER Tbk., P.T. TJIWI KIMIA Tbk, P.T. PINDO DELI and P.T. LONTAR PAPYRUS. Besides, APP has also a sister company in India namely SINAR MAS PULP AND PAPER Ltd., and three other paper plants in China namely ASIA PAPER (SHANGHAI) Co., Ltd., GOLD HONGYE PAPER (SUZHOU INDUSTRIAL PARK) Co., Ltd., and ZHENJIAN DADONG PULP & PAPER Co., Ltd. APP controls 51% to 100% shares of the above companies.

In mid 2000, the shares of APP in the USA (NewYork Stock Exchange) had been delisted because the share prices are far under US$ 1 and the number of APP’s debts keeps on increasing and uncontrolled. On 12 March 2001, APP declared to stop paying its debts (bad debts) worth US$ 13.9 billion comprising debts of 4 units of APP in Indonesia worth US$ 6.7 billion, indebted to IBRA worth US$ 1 billion, indebted to Export Credit Agency (ECA) worth US$ 960 million indebted to local bond holders worth US$ 230 million and the rest to others.

In Indonesia, APP requested to restructure its debts through Master Restructuring Agreement (MRA) divided into three trenches namely Trenches A of US$ 1.2 billion within 10 years with SIBOR interest rate plus 1 to 3 percent; Trenches B (refinance able debts) of US$ 3 billion with tenor of 10 years and SIBOR interest level plus 1 to 3 percent; and the rest is for Trenches C (unsustain debt). To pay its liabilities in March 2005, APP released its whole shares (96%) in P.T. PURINUSA EKAPERSADA.

In April 2007 (according to NERACA economic daily newspaper), the SINAR MAS Group will develop the largest paper plant in the world located in an island south of Hainan, China with an investment of Yuan$ 13.6 billion (US$ 1.8 billion). The company plans to have annual production capacity of 1.6 million tons of wooden fibers of eucalyptus in Hainan having been in production by 2009.

Meanwhile, China Daily said that APP China, a business unit of the SINAR MAS Group is being investigated by Hainan government after being accused by Green Peace activists of its involvement in illegal logging in natural forest of that island.

Last year (2009), paper and pulp production of SINAR MAS shrunk. In the first nine months of 2009, for example, PT. Indah Kiat only produced 1.4 million tons of pulp. This amount down 12.5% compared to the same period of 2008. Indah Kiat paper sales until the third quarter of 2009 also fell to 512,435 tons, down 5.8 compared to the same period of 2008 amounted to 544.071 tons. The paper production of PT. Chemical Tjiwi during January - September 2009 only reached 733 071 tons or fell 9.5% from the same period of 2008 as many as 810.079 tons. Outside fell production, SINAR MAS also faced accusation of paper dumping from the United States.

But the paper dumping accusation by the United States did not discourage SINAR MAS Group to expand. In April 2010, reportedly SINAR MAS would acquire a pulp mill in Mackenzie, British Columbia, Canada valued at U.S. $ 19.8 million. In addition SINAR MAS would also issue again its fund of U.S. $ 29.7 million to U.S. $ 39.6 million to operate the pulp mill again. According to the plan the pulp mill with production capacity of 235,000 tons per year, as much as 80% of its production would be marketed to Asia. (Source: Kontan Daily, April 19, 2010).

According to a newspaper Kontan, 19 April 2010, the SINAR MAS Group would buy a pulp mill in Mackenzie, British Columbia. Through its subsidiary in the Netherlands, Paper Excellence BV, the SINAR MAS Group would buy the plant in Canada valued at C$ 20 million or U.S. $ 19.8 million. Also in addition to the factory acquisition, SINAR MAS Group would also poured fund between C $ 30 million to C $ 40 million. The fund would be used to operate the plant with a capacity of 235.000 tons per year.

c. Developer and Real Estate Division

At present, 12 members of the SINAR MAS Group are active in real estate development, particularly in housing construction, in the country. The companies operate from bases in Jakarta, West Java, East Java, North Sulawesi, South Sulawesi and other places. The group now controls lands estimated at a total of some 400 hectares in various parts of Indonesia. The group's activities in this field are supported by other member companies active in the field of contracting.

The group also owns many office buildings in Jakarta, Surabaya, Manado, Ujung Pandang and other big cities in Indonesia. The SINAR MAS Group manages a luxurious and modern 18-storey office building at Jalan M.H. Thamrin in Central Jakarta. The building is made the headquarter of the SINAR MAS Group and managed by P.T. SINAR MAS TELADAN. The SINAR MAS Group also plays a very important part in the development of a new town in the Serpong area of West Java, named Bumi Serpong Damai. This sprawling housing complex is located some 35 kilometers west of Jakarta, and is being built on some 6,000 hectares land area. This project is now the biggest housing complex and real estate project in Indonesia.

The SINAR MAS Group jointly with the OMETRACO Group, the BIMANTARA Group and the RAJAWALI Group had completed the construction of a giant project combining a modern shopping center named Plaza Indonesia Shopping Centre and Grand Hyatt Jakarta Hotel, an International five star hotel located at Jalan M.H. Thamrin Kav. 28 – 30, Central Jakarta. The shopping center has been in operation since March 1990 of which its operation is running smoothly with an occupancy rate of 100%. While the Grand Hyatt Hotel has been in operation since March 1991 with an occupancy rate of 70% being managed by Hyatt of Hong Ltd, a subsidiary of the Hyatt International.

The SINAR MAS Group has been developing a large-size central business district in Mangga Dua, West Jakarta. The business district will be facilitated by an international trade centre, building material and textile wholesale market center, international-standard hotel, shopping center and modern office building. The project is developed by P.T. DUTA PERTIWI Tbk, a member of the SINAR MAS Group. The construction of the project is estimated to involve a total investment of about Rp. 300.0 billion. The materialization of the project had been commenced in 1989 and started operation in 1992.

P.T. DUTA PERTIWI Tbk has been developing also other housing projects in Jakarta and surrounding. The biggest Automotive Business Centre in the country is now being built by the SINAR MAS Group located at Commercial Estate CEMPAKA MAS, a property project owned by the SINAR MAS Group, with an investment of Rp 100.0 billion.

In association with prestigious Japanese partners-Itochu and Nissho Iwai, a new Industrial Township-cum-integrated housing development has been recently initiated in a strategic part of Bekasi, East of Jakarta. This landmark project, named Deltamas City, will span 3,000 hectares and will greatly improve the quality of working and domestic life for people in that area. In addition, the Division’s residential project include the 54,3 hectare housing complex Taman Permata Buana, 42 hectare Taman Duta Mas, 120,4 hectare Taman Banjar Wijaya, 100 hectare Jatiasih, 113,8 hectare Willa Complex Kota Bunga and the “Trend Setter” 450 hectare Kota Wisata developed together with Marubeni from Japan, LG Group from Korea and Land & House from Thailand.

Now the property division is handled by a holding company namely ASIA FOOD & PROPERTIES Ltd., (AFP), a sister company of the SINAR MAS Group listing on the Singapore Stock Exchange. Other than in Indonesia, AFP also set up a company in China namely SHANGHAI GOLDEN BUND REAL ESTATE Co., Ltd., involved in the development of Property Bund Centre project, an office building, retailing and apartment of 17,576 M2 in Shanghai, China. In Singapore, AFP also built 3 property companies namely AFP LAND LIMITED, AFP GARDENS (Tanjung Rhu) Pte., Ltd., and GOLDEN BAY REALTY Pte., Ltd., planning to build and manage a condominium HILLTOP GROVE. In Malaysia, AFP set up 2 companies namely ANAK BUKIT RESORT Sdn. Bhd., and PALM RESORT Bhd., now building a mega-resort in Pulau Batam. In the USA, AFP set up AFP PROPERTIES Inc., now building a number of hotels, residences, and apartment in Texas and California.

d. Financial Services Division

In 1982 the SINAR MAS Group took over the entire of the shares of P.T. Bank INTERNATIONAL INDONESIA, which at that time was a medium size national private bank. After a reorganization of the management, the bank emerged as one of the big-size national private banks in the country. The bank has been newly approved by the central bank, Bank Indonesia to become a foreign exchange bank. This company is also the parent company of the BANK INTERNATIONAL INDONESIA Group or the BII Group. The banking activities have since been widened to cover the fields of leasing, life insurance, sea and fire insurance, deposit taking, financing, etc. Previously the group controlled part of the shares of P.T. Bank ARTA PUSARA, a medium-size national private bank. Newly the shares had been released.

P.T. Bank INTERNATIONAL INDONESIA (BII) is one the nine banks still operating by joining a recapitalization program (Bank Lippo Tbk., Bank Bali Tbk., Bank Bukopin, Bank Niaga Tbk., Bank Universal Tbk., Bank Prima Express, Bank Arta Media, Bank Patriot and BII). But the people still doubt of their existence as seen from many clients have to draw their fund from the nine recapitalized banks. BII is the most bank urgently required fund from the recapitalization program. It has to pay at least Rp 1.5 trillion or 20% of Rp 7.6 trillion to meet with the 4% capital adequacy ratio (CAR) as provided by Bank Indonesia (BI) as central bank. Now it’s CAR still minus 15%. In such critical condition many big businessmen have difficulties to seek for money because a great deal of companies has been falling down.

In May 1995 P.T. SINAR MAS MULTIARTHA (P.T. SMM), holding company of financial sectors of the SINAR MAS Group had listed in the Jakarta and Surabaya Stock Exchange to go public by selling 60 million shares at nominal price of Rp. 550. -/share or 11.8% of the total share amounting to 510 million shares to raise fund of some Rp. 105 to Rp. 120 billion. Mrs. Fransiska Iskandar, financial director said P.T. SMM became holding company of the SINAR MAS Group since 1994 controlling 51% shares of P.T. BANK INTERNATIONAL INDONESIA, 100% shares of P.T. SINAR MAS EKAGRAHA, 100% shares of P.T. ASURANSI SINAR MAS, 100% shares of P.T. SUMMIT SINAR MAS FINANCE and 100% shares of P.T. SINARTAMA GUNITA. Some 70% of public fund is used for the expansion of factoring business and 30% for leasing business.

Based on shareholders meeting of 1 September 1999, Mr. Eka Tjipta Widjaja and family have been pulled-out from P.T. Bank INTERNATIONAL INDONESIA despite they have still 2.0% shares. The Central Bank (BI) does not allow Widjaja family to manage P.T. BII because they did not pass fit and proper test in connection with distortion of maximum credit limit issuance insurance, and its foreign loan to sky-rocket in rupiah.

But in 2005, P.T. SMM took over 53.53% shares of P.T. Bank SHINTA INDONESIA and then renamed to P.T. Bank SINARMAS dealing with banking services. In 2007 P.T. SMM increased its paid up capital of P.T. Bank SINARMAS from Rp. 125 billion to Rp. 275 billion and rose again to Rp. 45 billion in 2008. In January 2009 the authorized capital was raised to Rp. 2,000,000,000,000.- of which Rp. 525 billion was raised and fully paid up. Besides, P.T. Bank SINARMS has expanded its business by opening 40 new branch offices in 2007 and 22 new branch offices in 2008 and 66 units ATM in all office branches.

Besides, P.T. SMM also controls 16.14% shares of P.T. OTO MULTIARTHA, a private company dealing with motorcycle leasing and the rest is controlled by SUMITOMO Corporation of Japan (83.54%) and P.T. SUMMIT AUTO Group (0.32%). P.T. OTO MULTIARTHA has 47 branch offies in most towns in Sumatrra, java, Bali, Kalimantan and Sulawesi. In order to provide better and more convenient services to its customers, Company has developed collaboration with several prominent banks such as BCA, Mandiri, BII, Danamon, BRI, Bukopin, Swamitra (a Cooperative Nurtured by Bukopin Bank) and PT. Post Indonesia, providing facility for paying installment through Payment Point systems such as ATM, e-Banking, SMS Banking and Banking/Post Office Counter.

e. Energy and Mining Division

The SINAR MAS ENERGY AND MINING Group is a sub-group of the SINAR MAS Group. The parent company of the Group is P.T. DIAN SWASTIKA SENTOSA Tbk., a public listed company which has sold some of shares through Indonesian Stock Exchange (BEI). P.T. DIAN SWASTIKA SENTOSA Tbk., engaged in power plant development and management, base transceiver station management and investment holding by controlling shares in various companies engaged in coal trading and exploration and coal mining.

We see that the main activities of the SINAR MAS ENERGY AND MINING Group are in the power plant development and management, base transceiver station management, coal trading and exploration and coal mining. P.T. DIAN SWASTIKA SENTOSA Tbk (P.T. DSS) established on August 2, 1996, began to operate its four steam and electric power station in 1998 with current total production capacity of 300 MW of electricity and 1,336 tons/hour of steam. The plants are located in Tangerang, Serang, and Karawang.

P.T. DSS has already earned an International Organization for Standardization certificate in Quality Management System (ISO 9001:2000) for power plant operations and maintenance. Having been merged with P.T. SUPRA VERITAS at the end of December 2004, P.T. DSS diversified its ventures into trading pulp, paper, and chemicals. In 2008, P.T. DSS began its business in the telecommunication sector by leasing its Base Transceiver Station (BTS) towers to a number of cellular operators. At present the company has 1,105 BTS towers in Java, Bali and Lombok.

On December 10, 2009, P.T. DSS listed its 770,552,320 shares on the Indonesia Stock Exchange with the initial public offering (IP) priced at Rp. 1,500 per share. The funds raised from the IPO were invested in a coal mining business by taking over a 99.99% shares in P.T. BUMI KENCANA EKA SAKTI which secures coal mining concession in South Sumatera and Kalimantan.

Up to now the SINAR MAS ENERGY AND MINING Group comprises about 11 (eleventh) companies namely P.T. BORNEO INDOBARA (Coal mining), P.T. BUMI KENCANA EKA SAKTI (Investment holding), P.T. BUNGO BARA UTAMA (Coal Mining), P.T. DIAN SWSTIKA SENTOSA Tbk. (Power Plant Development and Management), P.T. KARYA CEMERLANG PERSADA (Coal Mining), KUANSING INTI MAKMUR (Coal trading and exploration), P.T. MANGGALA ALAM LESTARI (Coal trading and explration), P.T. MAKARYA EKAGUNA (coal trading), P.T. NUSANTARA INDAH LESTARI (Coal trading and exploration), P.T. ROUNDHILL CAPITAL INDONESIA (Investment holding), P.T. TRISULA KENCANA SKATI (Coal mining) and P.T. WAHANA ALAM LESTARI (Coal trading and exploration).

f. Trading and Other Activities

The group is also active on a large scale in trading. They have four big companies operating in the cooking oil trade on an international scale. Besides that, the group also owns many companies active as distributors of industrial chemicals, technical goods, oilfield equipment, industrial plants, motorcars, etc. But on the whole, these trading activities are supplementary to their main activities in the industrial field.

The group and the SALIM Group have built a pig-raising project in Riau, which activity has been in progress on a large scale since 1984. Then, the SINAR MAS Group jointly with the SALIM Group, the LAUTAN LUAS Group and the WINGS Group owns a big-size alkyl benzene (AB) plant in Serang, West Java. They also plant to build a single triphosphate (STPP) plant in West Java.

The SINAR MAS Group and the SALIM Group had established some joint ventures. Both giant business groups also have business stakes in others joint ventures, including P.T. UNGGUL INDAH CORPORATION, P.T. SINAR CULINDO PERKASA, P.T. COGNIS INDONESIA, P.T. PENG INDONESIA PERKASA, P.T. PETRO CENTRAL, etc. There are indications that an internal controversial disputes has been occurring between them. We heard that both parties will go separate ways.

The SINAR MAS Group also will engage in cement industry, which in this case, cooperation with a state-owned of Chuangdong Province (P.R. China) will be made to set up a cement factory in South Kalimantan with a production capacity of 350,000 tons per year. It will be running parallel with coal mining and processing in order to meet with coal-fired efficiently. No further information concerning how much money will be appropriated for the project, but it is said the first will be about US$ 60.0 million coal project. The realization will be started gradually under the P.R. China technology.

The SINAR MAS Group has recently established a new company P.T. INTITAMA MAS which will engage in cold rolled stainless steel manufacturing. The plant will be built in Karawang, West Java, with a production capacity of 180,000 tons cold rolled coils/sheets per year. The project will absorb an estimated total investment of some Rp 450.0 billion will come from company's capital of Rp 100.0 billion and the remainder from loans. The project still in preparation and there is no sign it will be realized imminent.

The SINAR MAS Group will build some 4,400 houses of medium-bottom types, and 360 unit’s storehouses in Bogor, West Java. The project will be handled by P.T. MEKANUSA CIPTA, with an investment of some Rp 44.2 billion will come from company's capital of Rp 12.0 billion and the balance from loans.

The project which will be expanded by the SINAR MAS Group at present is the development of oil palm plantation in Indonesia-Malaysia border in West Kalimantan with a long-term investment of US$ 500 million. To finance this project, the SINAR MAS Group will gain a fund from a consortium of banks of China with implementing contractors of CITIC (China International Trust and Investment Corp) Group. Besides, the SINAR MAS Group is also expanding oil fuel industry with jarak seed as the basic materials.

P.T. JOBSTREET INDONESIA is subsidiary of PT. Sinar Mas Multiartha Tbk., (40%) being a joint venture company with Jobstreet Corproaton Berhad, Malaysia (60%) engated in the supply of manpower through a manpower website. Up to now, PT. JobStreet Indonesia has clients from multinational and national private companies numbering more than 12,000 companies. From the database, the number of job seekers already registered in website up to the end of his 2009 is more than 780,000 active job seekers.

Financial Condition

Total sales turnover of the SINAR MAS Group is estimated to be increasing with a profit slight profit margin due to sharp rupiah depreciation against foreign currencies. Up to present, the SINAR MAS Group has been the largest company group in the country besides the SALIM Group. The division of pulp and paper of the SINAR MAS Group is the largest division in the country. Besides, the SINAR MAS Group is one of the largest company processing oil palm into cooking oil and property in Indonesia.

The financial condition of the SINAR MAS Group in 2007 to 2009 is reflected by the financial condition of its public listed company members below:

No.

Name of Company

Net Sales

Net Profit (Loss)

Total Assets

PT. Tjiwi Kimia Tbk.

- 2007

- 2008

- 2009

US$ 1,154.9 million

US$ 1,358.8 million

US$ 1,174.1 million

US$ 10.1 million

US$ 51.7 million

US$ 31.6 million

US$ 2,167.3 million

US$ 2,263.4 million

US$ 2,357.8 million

PT. Indah Kiat Tbk.

- 2007

- 2008

- 2009

US$ 1,879.3 million

US$ 2,277.0 million

US$ 1,773.4 million

US$ 91.8 million

US$ 202.4 million

(US$ 158.5 million)

US$ 5,487.8 million

US$ 5,968.0 million

US$ 5,813.5 million

PT. Duta Pertiwi Tbk.

- 2007

- 2008

- 2009

Rp 1,274,546 million

Rp 1,062,379 million

Rp 1,002,554 million

Rp 58,938 million

Rp 40,088 million

Rp 211,986 million

Rp 4,513,454 million

Rp 4,513,527 million

Rp. 4,429,503 million

PT. SMART Tbk.

- 2007

- 2008

- 2009

Rp 8,079,714 million

Rp 16,101,565 million

Rp 14,201,230 million

Rp 988,944 million

Rp 1,046,389 million

Rp 748,495 million

Rp 8,063,169 million

Rp 10,025,916 million

Rp 10,210,595 million

PT. Sinarmas Multiartha Tbk.

- 2007

- 2008

- 2009

Rp 1,112,010 million

Rp 8,021,469 million

Rp 11,097,846 million

Rp 533,354 million

Rp 263,554 million

Rp 700,098 million

Rp 14,130,577 million

Rp 15,537,221 million

Rp 19,700,337 million

PT. Lontar Papyrus Pulp & Paper

- 2007

- 2008

- 2009

US$ 352.2 million

US$ 378.0 million

US$ 339.3 million

US$ 2.1 million

US$ 18.5 million

(US$ 86.7 million)

US$ 1,021.9 million

US$ 1,114.9 million

US$ 1,047.7 million

PT. Pindo Deli Pulp & Paper

- 2007

- 2008

- 2009

US$ 651.2 million

US$ 1,316.0 million

US$ 1,269.7 million

US$ 45.3 million

US$ 67.3 million

US$ 32.8 million

US$ 2,742.1 million

US$ 2,956.7 million

US$ 3,043.5 million

PT. Dian Swastika Sentosa Tbk.

- 2007

- 2008

- 2009

n.a.

US$ 256.0 million

US$ 217.9 million

n.a.

US$ 29.1 million

US$ 5.6 million

n.a.

US$ 567.8 million

US$ 552.7 million

PT. Bumi Serpong Damai Tbk.

- 2007

- 2008

- 2009

Rp 1,440,718 million

Rp 1,386,111 million

Rp 1,270,592 million

Rp 106,564 million

Rp 223,462 million

Rp 308,738 million

Rp 3,607,961 million

Rp 4,381,085 million

Rp 4,592,836 million

Source: Financial report of the companies

Initially, the prime mover of the SINAR MAS Group at present is still Mr. Eka Tjipta Widjaja AKA Oei Ek Tjhong (88). He has a very simple education background, but he is a perseveringly self-taught person. He has succeeded in developing his ventures into a leading business empire, and the biggest in the edible oil industry, paper industry and private plantations. He has a rather controversial family life background. We have been told that he has many concubines who are, however, widely accepted in the Chinese community social environment. He has a very large number of children, all of whom will in due time become heirs to the above business empire. In 1990’s his position was taken over by Mr. Teguh Ganda Widjaja AKA Oei Tjie Goan AKA Tjhing Lian (67), the first son of Mr. Eka Tjipta Widjaja. He is decision maker of the SINAR MAS Group. He has a good and high education background, and is imbued with a very high business spirit. Many important business decisions in the group are now taken by Mr. Teguh Ganda Widjaja. In daily activities, he is assisted by his younger brothers Mr. Indra Widjaja AKA Oei Pheng Lian (59), Mr. Muktar Widjaja AKA Oei Siong Lian (57), Mr. Franky Oesman Widjaja AKA Oei Jong Nian (53) and Mr. Frankle Djafar Widjaja AKA Oei Piak Lian (55).

Besides, he is also supported by professional managers outside the family members. The management of the SINAR MAS Group has wide relation with private businessmen of home and overseas as well as with the government sectors. The SINAR MAS Group is sufficiently fairly good for normal business transactions. But, in view of the unstable economic condition and above negative factors, we recommend to treat prudently in business transaction and in extending a loan to the company to this company group.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.38
UK Pound	1	Rs.73.88
Euro	1	Rs.65.83

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%)

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.