MIRA INFORM REPORT

Report Date :

13.05.2011

IDENTIFICATION DETAILS

Name :	P.T. CLASSIC PRIMA CARPET INDUSTRIES
Formerly Known As :	P.T. CLASSIC PRIMA CARPET INDUSTRIES
Registered Office :	Jalan Rungkut Industri II/39 Surabaya Industrial Estate Rungkut Surabaya, 60292 East Java
Country :	Indonesia
Date of Incorporation :	8 March 1983
Legal Form :	Limited Liability Company
Line of Business :	Carpet 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$ 2,800,000
Status :	Satisfactory
Payment Behaviour :	No Complaints
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. CLASSIC PRIMA CARPET INDUSTRIES

Address

Head Office & Factory

Jalan Rungkut Industri II/39

Surabaya Industrial Estate Rungkut

Surabaya, 60292

East Java

Indonesia

Phone - (62-31) 8438331 (Hunting)

Fax - (62-31) 8439085

E-mail - impdept@cpci.co.id

Website - http://www.cpci.co.id

Land Area - 45,500 sq. meters

Building Area - 30,400 sq. meters

Region - Industrial Zone

Status - Owned

Branch

Jalan Pintu Air Raya 22/A

Jakarta Pusat, 10710

Indonesia

Phone - (62-21) 3855366, 3855307, 3855366, 365647

Fax - (62-21) 3844122

Building Area - 2 storey

Office Space - 600 sq. meters

Region - Commercial Building

Status - Owned

Registration data

Date of Incorporation :

a. 8 March 1983 as P.T. CROWN CARPET INDUSTRIES

b. 25 August 1983 as P.T. CLASSIC PRIMA CARPET INDUSTRIES

Legal Form :

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

Company Reg. No. :

The Ministry of Law and Human Rights

No. C-UM.02.01.11876

Dated 15 August 2005

Company Status :

Private National Company

Permit by the Government Department :

a. The Department of Industry & Trade

No. 554/DJAI/IUT-III/Non PMA-PMDN/XII/91

Dated 25 January 1991

b. The Department of Finance

NPWP No. 01.231.841.6-615.000

Related Companies :

a. P.T. ALTIA CLASSIC AUTOMOTIVE MANUFACTURING (Car Mat Manufacturing)

b. P.T. Bank SWADESI Tbk (Banking Services)

c. P.T. CLASSIC EXPORTINDO JAYA (Trading and Exporter of Soap, Detergent, Shampoo

Products, and Garment Products)

d. P.T. CLASSIC INTERMARK (Soap and Detergent Manufacturing)

e. P.T. FRONTE CLASSIC INDONESIA (Carpet and Rugs Manufacturing)

f. U.D. ISTANA DEKORASI (Trading of Carpet and Textile Design Interior Services)

g. P.T. KOTOBUKIYA INDO CLASSIC INDUSTRIES (Carpet Manufacturing)

h. C.V. MULTINDO PERKASA (Importing and Trading of Carpet and Textile)

i. P.T. UNIVERSAL CARPET AND RUGS (Carpet and Rugs Manufacturing)

CAPITAL AND OWNERSHIP

Capital Structure :

Authorized Capital : Rp. 100,000,000,000.-

Issued Capital : Rp. 50,000,000,000.-

Paid up Capital : Rp. 50,000,000,000.-

Shareholders/Owners :

a. Mrs. Devakabai Bhagwan Chugani - Rp. 10,000,000,000.-

Address : Jl. Raya Kertajaya Indah 20-22

Surabaya, East Java, Indonesia

b. Mr. Kamla Rupchand Chugani - Rp. 10,000,000,000.-

Address : Jl. Raya Kertajaya Indah 20-22

Surabaya, East Java, Indonesia

c. Mr. Prakash Rupchand Chugani - Rp. 10,000,000,000.-

Address : Jl. Tampak Siring Elok 10

Jakarta Utara

Indonesia

d. Mr. Deepak Rupo Chugani - Rp. 10,000,000,000.-

Address : Jl. Sanur Indah No. 75-77

Jakarta Utara

Indonesia

e. Mr. Deepak Rupo Chugani - Rp. 10,000,000,000.-

Address : Jl. Sanur Indah No. 75-77

Jakarta Utara

Indonesia

BUSINESS ACTIVITIES

Lines of Business:

a. Carpet Manufacturing

b. Investment Holding

Production Capacity :

a. Carpets (Floor Covering, Automotive

Carpet, Printed Rugs) - 14,400,000 sq. meters p.a.

b. Polypropylene Yarns - 3,600 tons p.a.

Total Investment :

a. Owned Capital - Rp. 50.0 billion

b. Loan Capital - Rp. 20.0 billion

c. Total Investment - Rp. 70.0 billion

Started Operation :

May 1984

Brand Name :

CLASSIC

Technical Assistance :

None

Number of Employee :

450 persons

Marketing Area :

Export - 75%

Local - 25%

Main Customer :

Buyers in the Singapore, Malaysia, Thailand, Taiwan, Hong Kong, Pakistan, India,

The Middle East, etc

Market Situation :

Very Competitive

Main Competitors :

a. P.T. NOBEL INDAH CARPET INDUSTRIES

b. P.T. INDONESIA CARPET MANUFACTURING

c. P.T. HERCULON CARPET

d. P.T. RAINBOW INDAH CARPETS

Business Trend :

Growing

BANKER, AUDITOR & LITIGATION

B a n k e r s :

a. ABN-AMRO Bank

Jalan Pemuda No. 54

Surabaya, East Java

Indonesia

b. P.T. Bank SWADESI Tbk

Jalan Tunjungan No. 32

Surabaya, East Java

Indonesia

Auditor :

Internal Auditor

Litigation :

No litigation record in our database

FINANCIAL FIGURE

Annual Sales (estimated) :

2008 – Rp. 205.0 billion

2009 – Rp. 209.0 billion

2010 – Rp. 213.0 billion

Net Profit (estimated) :

2008 – Rp. 16.4 billion

2009 – Rp. 17.8 billion

2010 – Rp. 18.3 billion

Payment Manner :

Average

Financial Comments :

Satisfactory

KEY EXECUTIVES

Board of Management :

President Director - Mr. Deepak Rupo Chugani

Directors - a. Mr. Dilip Rupo Chugani

b. Mr. Narwani Prakash Kotumal

c. Mrs. Imelda Lyzawati Sutanto

Board of Commissioners :

President Commissioner - Mrs. Rupo Narindas Chugani

Commissioners - a. Mrs. Devakabai Bhagwan Chugani

b. Mr. Kamla Rupchand Chugani

c. Mr. Prakash Rupchand Chugani

Signatories :

President Director (Mr. Deepak Rupo Chugani) or one of the Directors (Mr. Dilip Rupo Chugani, Mr. Narwani Prakash Kotumal or Mrs. Imelda Lyzawati Sutanto) which must be approved by Supervisory Board.

CAPABILITIES

Management Capability :

G o o d

Business Morality :

G o o d

Credit Risk :

Average

Credit Recommendation :

Credit should be proceeded with monitor

Proposed Credit Limit :

Small amount – periodical review

Maximum Credit Limit :

US$ 2,800,000 on the 90 days of payments

OVERALL PERFORMANCE

Initially named P.T. CROWN CARPET INDUSTRIES, the company was established in Surabaya, East Java, in March 1983 with an authorized capital of Rp. 500,000,000 issued and paid up capital of Rp. 100,000,000. The original founding shareholders were the late Mr. Bhagwan Naraindas Chugani, Mr. Jivat Hardasmal Khiani, both are Indian ethnic Indonesian businessmen, and Mr. Soejadi, a native businessman. The notarial act has frequently been revised. In August 1983 the company was renamed P.T. CLASSIC PRIMA CARPET INDUSTRIES (P.T. CPCI), and in August 1990 the authorized capital was raised to Rp. 15,000,000,000 issued and paid up capital to Rp. 4,000,000,000. The shareholders are Mr. Jivat Hardasmal Khiani, Mr. Prakas Hardasmal Khiani and Mrs. Devakabai Bhagwan Chugani. Lastly in 1996 that Mr. Jivat Hardasmal Khiani pulled out and his shares had been taken over by his older brother Mr. Prakas Hardasmal Khiani. The latest in June 2004, the authorized capital was raised to Rp. 100,000,000,000 issued capital of Rp. 50,000,000,000 entirely issued and paid up. On the same occasion, Mr. Prakas Hardasmal Khiani and Mr. Jivat Hardasmal Khiani pulled out and replaced by Mr. Kamla Rupchand Chugani, Mr. Prakash Rupchand Chugani, Mr. Deepak Rupo Chugani and Mr. Dilip Rupo Chugani, all of them are Indian ethnic Indonesian business family.

The Deed of amendment was made by Mr. Jusuf Patrianto Tjahjono, SH., a public notary in Surabaya under Company Registration Number C-UM.02.01.11876, dated August 15, 2005. We see that majority business stakes is controlled by Mr. Prakash Rupchand Chugani and family members. Mr. Prakash Rupchand Chugani and Mr. Deepak Rupo Chugani is also majority business stakes owner of P.T. Bank SWADESI Tbk engaged in banking services, P.T. CLASSIC EXPORTINDO JAYA dealing with trading and exporter of soap, detergent, shampoo products and garment products, P.T. CLASSIC INTERMARK dealing with soap and detergent manufacturing, UD. ISTANA DEKORASI engaged in trading and distribution of carpet and C.V. MULTINDO PERKASA in importing and trading and trading of carpet and textile.

P.T. CPCI is engaged in carpet and polypropylene yarn industry with its plant located at Jalan Rungkut Industri II/39 Surabaya on a land of some 45,500 square meters and building space of 30,400 square meters, operating since 1984. The plant has frequently been expanded to increase production capacity. It operates 7 units of machines made in USA, UK and Belgium, with production capacity of 14,400,000 sq. meters carpet, consisting of floor-covering, automotive carpet and printed rugs. Particular printed rug had newly been producing in March 1997. The company is also producing polypropylene yarns (PP) as basic material of carpet with a production capacity of 3,600 tons per year, while PP basic materials partly imported from South Korea, and polypropylene nylon is imported from Europe mainly Belgium. The development of the plant has absorbed an investment of Rp. 70.0 billion. The company has already met stringent international performance criteria such as J.I.S, A.W.I.A, and A.S.T.M., which is eloquent testimony to quality. After ISO recognition in 1997, the company is now focusing on CRM where the ultimate objective is on customer delighting. The production capacity of more than 5,000 tons annually, classion is the largest quantity of yarn produced in the region.

Mr. Chaotjun, S.S., a senior marketing staff, pointed out the main product is floor covering with a production of some 14.4 million sq. meters per year. Some 75% of them are exported to many countries including Saudi Arabia, Arab Emirate Union, Bahrain, Kuwait, Malaysia, Singapore, Thailand, Taiwan, Hong Kong, Pakistan, India, etc. under CLASSIC brand, and the other 25% for local market of the same brand and distributed by sister company U.D. ISTANA DEKORASI, while some 80% of automotive carpets are exported to Japan.

Besides, P.T. CPCI is also engaged in investment holding by controlling of some 20% shares of P.T. ALTIA CLASSIC AUTOMOTIVE MANUFACTURING dealing with car mat manufacturing; 20% shares of P.T. FRONTE CLASSIC INDONESIA dealing with carpet and rugs manufacturing; 25% shares of P.T. KOTOBUKIYA INDO CLASSIC INDUSTRIES dealing with carpet manufacturing and 20% shares of P.T. UNIVERSAL CARPET AND RUGS dealing with carpet and rugs manufacturing.

Generally we find the local demand for carpet had been rising by 6% to 7% per year within the last five years in line with the rapid growth of hotels, luxury houses, office buildings, apartments and other sectors in that period. But since the global economic crisis and tight money policy being imposed by Bank Indonesia in October 2008 the demand had been fluctuating. However since the early 2009 the demand has been increasing due to the amelioration economic condition in the country. It is estimated the demand will rise again in line with a slight amelioration of economic condition, stability of political and security in the country. Competition is very tight due to a large number of similar companies operating in the country, such as, P.T. NOBEL INDAH CARPET INDUSTRIES, P.T. INDONESIA CARPET MANUFCTURING, P.T. HERCULON CARPET, P.T. RAINBOW INDAH CARPETS, P.T. MULTI WARNA, etc. Business position of P.T. CPCI is not so critical for it has maintained a wide business at home and overseas.

Until this time P.T. CPCI has not been registered with Indonesian Stock Exchange, so that they shall not obliged to announce their financial statement. The management of P.T. CPCI 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. 205.0 billion rose to Rp. 209.0 billion in 2009 increased to Rp. 213.0 billion in 2010 and projected to go on rising by at least 4% in 2011. The operation in 2010 yielded an estimated net profit of at least Rp. 18.3 billion and the company has an estimated total networth of at least Rp. 98.0 billion. 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 is headed by Mr. Deepak Rupo Chugani (39), a professional manager with experience for more than 9 years in carpet manufacturing. But the primemover of the company his father Mr. Kamla Rupchand Chugani (60). We observed that management’s reputation in said business is fairly good. The management is also supported by a team of professional managers having maintained a wide business relation among private businessmen at home and abroad as well as among government sectors. So far, we did not hear that the management of the company being filed to the district court for detrimental cases. P.T. CLASSIC PRIMA CARPET INDUSTRIES is considered to be good for business transaction.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.79
UK Pound	1	Rs.73.19
Euro	1	Rs.63.59

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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