MIRA INFORM REPORT

Report No. :	486836
Report Date :	30.01.2018

IDENTIFICATION DETAILS

Name :	PT. KENCANA HIJAU BINALESTARI
Registered Office :	Jl. Pluit Karang Cantik Blok O 4 Barat No. 19 RT 006 RW 003 Kelurahan Pluit, Kecamatan Penjaringan Kota Jakarta Utara 14450 DKI Jakarta
Country :	Indonesia
Date of Incorporation :	25.08.2011
Legal Form :	Private Limited Liability Company
Line of Business :	Crop and animal production, hunting and related service activities Growing of non-perennial crops Manufacture of basic chemicals, fertilisers and nitrogen compounds, plastics and synthetic rubber in primary forms Growing of other non-perennial crops Manufacture of other organic basic chemicals
No. of Employees :	1,000

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

B

Credit Rating	Explanation	Rating Comments
B	Medium Risk	Business dealings permissible on a regular monitoring basis

Status :	Moderate
Payment Behaviour :	Slow but Correct
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

Country Name	Previous Rating (30.06.2017)	Current Rating (30.09.2017)
Indonesia	A2	A2

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	D

INDONESIA - ECONOMIC OVERVIEW

Indonesia, the largest economy in Southeast Asia, has seen a slowdown in growth since 2012, mostly due to the end of the commodities export boom. During the global financial crisis, Indonesia outperformed its regional neighbors and joined China and India as the only G20 members posting growth. Indonesia’s annual budget deficit is capped at 3% of GDP, and the Government of Indonesia lowered its debt-to-GDP ratio from a peak of 100% shortly after the Asian financial crisis in 1999 to 33% today. While Fitch and Moody's Investors upgraded Indonesia's credit rating to investment grade in December 2011, Standard & Poor’s has yet to raise Indonesia’s rating to this status amid several constraints to foreign direct investment in the country, such as a high level of protectionism.

Indonesia still struggles with poverty and unemployment, inadequate infrastructure, corruption, a complex regulatory environment, and unequal resource distribution among its regions. President Joko WIDODO - elected in July 2014 – seeks to develop Indonesia’s maritime resources and pursue other infrastructure development, including significantly increasing its electrical power generation capacity. Fuel subsidies were significantly reduced in early 2015, a move which has helped the government redirect its spending to development priorities. Indonesia, with the nine other ASEAN members, will continue to move towards participation in the ASEAN Economic Community, though full implementation of economic integration has not yet materialized.

Source : CIA

COMPANY IDENTIFICATION

Company Name	PT. Kencana Hijau Binalestari
Address	Jl. Pluit Karang Cantik Blok O 4 Barat No. 19 RT 006 RW 003 Kelurahan Pluit, Kecamatan Penjaringan Kota Jakarta Utara 14450 DKI Jakarta - Indonesia
Telephone	+622166695230
Fax	N.A.
Mobile Phone	N.A.
Email	info@kencanahijau.com
Web	www.kencanahijau.com

PROFILE

Address

Jl. Pluit Karang Cantik Blok O 4 Barat No. 19 RT 006 RW 003
Kelurahan Pluit, Kecamatan Penjaringan
Kota Jakarta Utara 14450
DKI Jakarta - Indonesia

Office Building

a.	Area - Commercial
b.	Status - Leased

Date of Establishment

-	25 August 2011

Start Operation

March 2016

Legal Status

Private Limited Liability Company or Perseroan Terbatas (PT)

Legalization (historical)

No. AHU-43358.AH.01.01.Tahun 2011
Dated, 25 August 2011

No. AHU-AH.01.03-0156586
Dated, 27 July 2017

Government Permit (s)

Direktorat Jenderal Pajak
NPWP - 03.279.227.7-047.000

Significant change

PT. Kencana Hijau Binalestari (the Company) was established on August 25, 2011 in North Jakarta - DKI Jakarta with the authorized capital of IDR 5,000 million, with issued and paid up capital of IDR 1,250 million. The structure of shareholder were Mr. Tio Effendy Tios (70.000%), Mr. Tami Abadi Tios (10.000%), Ms. Lao Hong Ling (10.000%) and Ms. Aisa Tios (10.000%).

On July 25, 2017, the Company published a notarial act by not changing the authorized capital and shareholders structure.

As far as we know, there has been no more change in the Company’s notarial act as published by the Ministry of Justice.

Capitalization

     -    Authorized Capital
     -    Issued Capital
     -    Paid Up Capital

IDR 5,000,000,000
IDR 1,250,000,000
IDR 1,250,000,000

SHAREHOLDERS & MANAGEMENT

Shareholders

Total No. of Shareholders: 4
Shareholders as 27 July 2017
Total Shareholding private – 1,250 shares

Name of Shareholders

-	Mr. Tio Effendy Tios (875 shares) - 70.000 %
-	Mr. Tami Abadi Tios (125 shares) - 10.000 %
-	Ms. Aisa Tios (125 shares) - 10.000 %
-	Ms. Lao Hong Ling (125 shares) - 10.000 %

Management Board

Name

Mr. Tio Effendy Tios

Position

President Director

Nationality

Indonesian

Name

Mr. Tami Abadi Tios

Position

Director

Nationality

Indonesian

Name

Ms. Aisa Tios

Position

Director

Nationality

Indonesian

Supervisory Board

Name

Ms. Lao Hong Ling

Position

Commissioner

Nationality

Indonesian

Management Assessment

The management is deemed to have sufficient experience and industry expertise to manage subject properly.

Authorized Signatories

Mr. Tio Effendy Tios as President Director, Mr. Tami Abadi Tios and Ms. Aisa Tios as Directors of the Company which must be approved by shareholders's meeting.

Affiliate (s) / Associate (s)

-	PT. Prodotti Indonesia (Agents involved in the sale of furniture, household goods, hardware and ironmongery)
-	PT. Prabu Wahana International (Service activities incidental to air transportation)

KEY DATA ON OPERATIONS

Registered Activities

SIC Code 01 : Crop and animal production, hunting and related service activities
SIC Code 20 : Manufacture of chemicals and chemical products

Number of Employee

Approximately 1,000 employees

Business Category

SIC Code 01.1 : Growing of non-perennial crops
SIC Code 20.1 : Manufacture of basic chemicals, fertilisers and nitrogen compounds, plastics and synthetic rubber in primary forms

Line of Business

SIC Code 01.19 : Growing of other non-perennial crops
SIC Code 20.14 : Manufacture of other organic basic chemicals

Product & Capacity

- Gum turpentine - 15,000 tons p.a.

Status of Investment

Non-facilities based Company

Sales Territory

Local

90%

International

10%

Main Items Imported
And Country Origin

Industrial Machinery

China

Main Items Exported
and Country Destination

Gum turpentine
Gum turpentine
Gum turpentine

India
Europe
South Korea

Major Customers

-	Buyer from India
-	Buyer From Europe
-	Buyer from Korea

Major Supplier

-	Local Pine Plantation

Terms of Payment

Purchase Payment
Domestic: Telegraphic Transfer (T.T) based on Agreement;
Overseas: Telegraphic Transfer (T.T) based on Agreement;

Sale Terms
Domestic: Telegraphic Transfer (T.T) based on Agreement;
Overseas: Telegraphic Transfer (T.T) based on Agreement;

Activity Comment

PT. Kencana Hijau Binalestari (the Company) is a non-facilities based company that is engaged in pine industry and has been operating since March 2016. The head office and registered address of the Company are located at Jl. Pluit Karang Cantik Blok O 4 Barat No. 19 RT 006 RW 003, Kelurahan Pluit, Kecamatan Penjaringan, Kota Jakarta Utara 14450, DKI Jakarta - Indonesia. We believe that the location is leased from another parties.

Based on our investigation, the Company is engaged in the management of pine plantation and pine resin processing. In 2014, the Company had signed an agreement with the Aceh Forestry Department and obtain pine resin tapping and citronella grass planting permit in an area of 55,000 ha in Kab. Gayo Lues - Nanggroe Aceh Darussalam per 2016.

In addition, the Company has a processing factory of crude pine resin into its first derivative products: gum rosin and turpentine oil. The factory is located close to the concession area in Dusun Atu Baro Desa Pinang Rugub, Kecamatan Rikit Gaib, Kab. Gayo Lues and has begun operating in March 2016. At the factory, the Company can produce between 10,000 tons and 15,000 tons of Gum Rosin (Gum turpentine) per year. The Company's product has been tested in various laboratories such as Agricultural Institute of Bandung, Sucofindo, and Anton Testing & Consultancy Services Ltd. (China).

In the operation, the Company is supported by modern technological production machines imported from China. In addition, the Company also obtains raw pine resin from another pine plantation company in Aceh.

In April 2017, the Company signed a Cooperation Agreement on Pine Resin Tapping between UPTD KPH Pemprov Sulbar (West Sulawesi Provincial Government) and the Company. In the next two years, a pine resin processing factory will be operate to meet the needs of pine resin.

In general, the Company's operational performance from the beginning of operation until the early 2018 is quite good. The Company's product sales are quite stable even increased. In the future, the Company plans to build a pine resin processing factory in West Sulawesi.

Unfortunately we are unable to confirm the Company's current cash flow management.

In its operation, the Company currently employs approximately 1,000 employees.

At the time this report is written, this Company has not been involved in any criminal or civil cases. This statement is based on a result of search for cases conducted at the State Court in the district where the Company was established and operates today.

Plantation and Factory Address

Dusun Atu Baro Desa Pinang Rugub, Kecamatan Rikit Gaib
Kab. Gayo Lues
Nanggroe Aceh Darussalam - Indonesia
Phone : -
Fax : -
Email : -

BANKING INFORMATION

Banker (s)

-	PT. Bank Central Asia Tbk

Insurance

-	Badan Penyelenggara Jaminan Sosial (BPJS)

BUSINESS PROSPECTS

Business Prospects

Indonesia is ranked second to China in international pine resin trade. China produces 430,000 tons of resin (60% of the world's total production) while Indonesia produces 69,000 tons of resin (10% of the world's total production). According to Perhutani, pine resin is one of the commodities with high demand both locally and internationally, where 80% of its production is allocated for export to Europe, India, South Korea, Japan and America. The world's current gum rosin demand is increasingly supported by the development of science, and today we have found many innovative products of gum rosin derivatives, so we believe that the Company is still prospective in the future. Given the high demand for the world's resin products, we are confident that the Company's business is still prospective in the next few years.

FINANCIAL STATEMENT

Sales Turn Over	2016 - IDR 120,000,000,000 (Estimated (10 Months)) 2017 - IDR 138,000,000,000 (Estimated)
Total Assets	As the Company is not a publicly listed company, we are unable to give a detailed picture of the financial condition of the Company.
Other Financial Data	As the Company is not a publicly listed company, we are unable to give a detailed picture of the financial condition of the Company.

CREDITWORTHINESS

Management Capability	Adequate
Business Morality	Adequate
Payment Manner	Slow but Correct
Financial Condition	Satisfactory
Operating Trend	Undetermined
Conclusive remarks	Based on the information shown above, we learned that the Company is engaged in the management of pine plantation and pine resin processing in Kab. Gayo Lues, Nangroe Aceh Darusalam (NAD). The Company produces crude pine resin into its first derivative products: gum rosin and turpentine oil. Until now, the Company has exported products to India, Europe and South Korea. As we know, the Company's operational performance from the beginning of operation to this day looks pretty good. Meanwhile, seeing the world's current gum rosin demand continues to increase as more and more product innovations from gum rosin, we believe that the Company is still prospective in the future. So based on the above considerations, we provide a credit rating of "medium" risk. Although relatively new in operation, world needs of gum resins is still high and the expansion of the Company to build a new industrial crop forest makes us confident that the Company is optimistic about the market potential that exists. For security reason, then, we advise those wishing to cooperate with or grant loans to this Company to keep asking for adequate collateral from its shareholders.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 63.55
UK Pound	1	INR 89.82
Euro	1	INR 78.87
IDR	1	INR 0.0045

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	VAR
Report Prepared by :	TRU

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

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 are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

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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.