Company Focus

PT PP LONDON SUMATRA

Set for solid medium-long term growth

We are initiating our coverage on PT PP London Sumatra Tbk. (LSIP) with BUY recommendation on a 12M target price of Rp2,675/share, represents 24.4% potential upside. We view LSIP has advantages on massive landbank up to 40,000ha, diversified plantation profile including as seeds producer, a holding company within Salim Group that will benefit LSIP to maintain demand of its production and having the back of one of biggest conglomerates in Indonesia, and on Roundtable on Sustainable Palm Oils (RSPO) certification where commonly, CSPO generates premium prices from environmentally and socially responsible buyers. Massive landbank. LSIP recorded up to 99,338ha planted nucleus area at the end of September 2011 where palm oil planted area accounted for 78.8% of total area followed by rubber planted area reached 17.5% and remaining were for cocoa, tea and coconut planted area. For further expansion, LSIP does have major benefit by having massive landbank up to 40,000ha available to be planted, located in South Sumatera and East Kalimantan. This will provide major strategy for LSIP to grow and tap potential growth within palm oil industry. Relatively young age profile plantation. Another advantage LSIP has would be the companys relatively young age plantation profile. The palm oil plantation ages around 10 years and for rubber plantation ages around 12 years. With young age plantation profile means strong growth can be expected from existing plantation assets where prime production for palm oil commonly ages from 8th 17th years and tapping cycle for rubber between 10 20 years of ages. Diversified plantation profile. LSIP recorded diversified plantation mix consisting of palm oil, rubber, tea, cocoa and coconut. The company also produces and sells palm oil seeds. The products mix benefits LSIP with possible offsetting the production and selling prices changes. In 2010, sales for palm oil seeds recorded gain 14.2% YoY to 20.7mn seeds, offsetting the dropped in sales of CPO down -3.1% YoY, rubber -15.2% YoY and others (tea, cocoa and coconut) down -17.2% YoY. In the same year, CPO recorded higher selling price, up 9.4% YoY, compared to dropped in selling prices for other products including rubber, others (tea, cocoa and coconut) and palm oil seeds. Growing contribution to Salim Ivomas. After acquired by PT Salim Ivomas Pratama and Indofood Agri Resources, the plantation arm of PT Indofood Sukses Makmur Tbk. in 2007, sales to SIMP in 9M11 increased to Rp2.3tn, equivalent to 64.5% of total sales, compared to 9M10 Rp1.3tn (52.7%) and compared to FY10 Rp2.0tn (56.9%). We see this as positive note for LSIP as it could maintain demand side and having substantial backing from Indofood Group. 9M11 performance. LSIP recorded 104.5% YoY net income growth in 9M11 to Rp1.3tn, compared to a year earlier Rp641.8bn. Higher growth contributed by higher sales that grew 46.6% YoY to Rp3.5tn compared to 9M10 Rp2.4tn, driven by higher sales volume of palm oil products and SumBio palm oil seeds and higher selling prices for palm oil products and rubber. About 94% of total CPO sales volume sold to SIMP, increased from 78% in 9M10. However, the company recorded lower planted nucleus area to 99,338ha from FY2010 101,705ha, due to implementation of new block management system for more effective control where the management has re-measured the net planted area per block that will not impact the crop production. Valuation. Given some opportunities available for potential strong growth for LSIP including landbank availability, relatively young age plantation profile, products mix, strong back as Indofood group and healthy balance sheet, we initiate LSIP with BUY recommendation which trading at 2012F PER of 11.0x and EV/EBITDA of 7.2x.

15-Dec-11
Ticker Price Target Price Recommendation Upside (Downside) Market Cap (Rptn) Issued Share (bn share) Shareholders PT Salim Ivomas Pratama Tbk. Public LSIP 2,150 2,675 BUY 24.4% 14.7

59.5% 40.5% 2010 3,592.7 1,597.6 1,033.3 151.5 49.3% 44.5% 28.8% net cash 2011F 4,161.8 2,111.2 1,625.8 238.3 55.1% 50.7% 39.1% net cash

Revenue (Rpbn) EBITDA (Rpbn) Net Profit (Rpbn) EPS (Rp) Gross Margin (%) EBITDA Margin (%) Net Margin (%) Net Gearing (x)

Sheila Yovita sheila.yovita@ocap.co.id

PP London Sumatra
Year-end 31-Dec Revenue (Rpbn) EBITDA (Rpbn) Net profit (Rpbn) EPS (Rp) EPS Growth (%) EBITDA Margin (%) Net Margin (%) P/E Ratio (x) EV/EBITDA (x) Return on Equity (%) Net Gearing (%)
2008 2009 2010 2011F 2012F

3,846.2 3,199.7 3,592.7 4,161.8 4,378.7 1,440.1 1,171.4 1,597.6 2,111.2 2,207.3 927.6 707.5 1,033.3 1,625.8 1,644.8 135.9 103.7 151.5 238.3 241.1 64.5% -23.7% 46.1% 57.3% 1.2% 37.4% 36.6% 44.5% 50.7% 50.4% 24.1% 22.1% 28.8% 39.1% 37.6% 21.5 80.5 84.8 11.5 11.0 13.6 16.2 11.5 8.2 7.2 29.0% 18.6% 22.7% 29.4% 25.2% net cash net cash net cash net cash net cash

PP London Sumatra COMPANY SUMMARY

LSIP established in 1962, yet the origin can be retraced to more than a century ago from London-based Harrisons & Crosfield Plc as a general trading and plantation management service firm. The company commenced palm oil production in the 1980s and eversince has broadened scope of business to plant breeding, planting, harvesting, processing and selling of palm products, rubber, seeds, cocoa and tea. In 1994, Harrisons & Crosfield sold its entire interest to PT Pan London Sumatra Plantations which took LSIP went public in 1996. LSIP initiated public offering back in 1996, offering 38.8mn shares with total number of 202.3mn shares issued and outstanding each with nominal value of Rp500 per share at offering price Rp4,650. The company has done issuing new shares through bonus shares and debt convertion throughout these years with recent in January 2011, where LSIP did stock split in nominal value to Rp100 per share from Rp500 per share. As of September 2011, LSIP total shares outstanding is at 6.8bn shares with total market capitalization reached Rp15.9tn. In October 2007, Indofood Agri Resources Ltd (IndoAgri), became LSIP majority shareholder through subsidiary, PT Salim Ivomas Pratama Tbk. where LSIP became part of Indofood Group. In December 2010, IndoAgri divested 8% interest in the company that increased LSIP public shares floats to 40.5% from 35.6%, helping the company to post lower income tax to 20% from previous 25%.

Estates spreads over Indonesia

LSIP recorded totaled 99,338ha of nucleus planted area as of September 2011, composed of 78,291ha (78.8%) palm oil plantation, 17,427ha (17.5%) of rubber plantation and others 3,620ha. Those planted area consisting of 38 estates spreading in seven areas in Indonesia: Sumatera (North and South), Kalimantan (West), Java (Bandung and Banyuwangi), and Sulawesi (North and South). LSIP has accelerated its infrastructure development to catch-up the delays in 2010 due to short dry months. This infrastructure development likely ensures higher productivity thus lower costs where LSIP has recorded improvement in gross margin from 43.5% in 2009 to 49.3% in 2010 and from 52.2% in 9M11 from a year earlier 48.1%, helped by dropped in upkeep, cultivation and harvesting costs. As of June 2011, LSIP operates 11 palm oil processing mills, 4 crumb rubber factories and 3 sheet rubber factories with total capacity per year reached 2.3mn tons of TBS, 53.8k tons of dry rubber.

One of largest producer of CSPO in Indonesia

In palm oil business, LSIP has international RSPO certification for sustainable farming practices. The company has RSPO certificates for its North Sumatera estates and South Sumatera three estates and one CPO mills, totaling 195k tons CSPO producing per year. Environmentally and socially responsible buyers usually willing to pay a premium for responsibly produced products, hence will likely benefit for LSIP. There are only 17 RSPO certified producer and supply chain members in the whole world.

PP London Sumatra Operational Highlights

Landbank and young age plantation profile as main engine further growth LSIP will likely have potential for strong growth backed by up to 40,000ha landbank where landbank availability is the main engine growth for plantation companies. With minimum new planting at 5,000ha area per year, we assume LSIP to be fully planted all its landbank in 2020F that will set the company for solid medium-long term growth. LSIP also recorded young age plantation profile where in 2010, average age for palm oil plantation age was 11.0 years and average age for rubber age was 12.6 years that enable LSIP to still benefit for potential 5 - 10 years ahead. Palm oil seeds as other potential engine growth LSIP is well-known for its R&D research. The division, Sumatra Bioscience (SumBio), provides expertise in the areas of agronomy, crop protection, plant tissue culture, biotech, pathology and entomological research as well as producing quality palm oil and cocoa planting material. SumBios with its advanced palm oil seed-breeding program operates seed germination facilities capable of producing up to 25mn superior palm oil seeds per annum and with high quality seeds, the company commands premium price in market where major market were to domestic market. Despite small contribution from seeds business, LSIP recorded growing contribution from this business where sales contribution rose to 5.4% in 2010 from 2.0% and 5.1% in 2009 and 2008 respectively. The sales also recorded higher in 2010, up 200.8% YoY to Rp193.2bn compared to a year earlier Rp64.9bn. Seeds consistently posted highest margin compared to palm oil, rubber, cocoa, tea and coconut where the operating margin were at 72.9%, 35.1% and 69.4% in 2008, 2009 and 2010 respectively. Production Highlight Since 2006, LSIP harvested more than 1mn tons of FFB within its nucleus plantation area with average yield at 19.1tons/ha. In 2010, the company harvested 1.2mn tons of FFB with average yield down to 17.1tons/ha. The dropped in FFB yield was due to additional newly mature area. In our projection, we forecasted LSIP to harvest up to 1.7mn tons of FFB within the next ten years, helped by potential new planting area from current landbank where total nucleus planted area will reached up to 128,291ha by then. In 9M11, LSIP harvested 940,615tons of FFB from nucleus planted area, up 12.6% YoY compared to 9M10 at 835,332tons. The growth also recorded on quaterly basis where LSIP posted 8.4% QoQ growth to 350,589 tons of harvested FFB compared to 2Q11 326,058tons. There were also significant growth in FFB from plasma and 3rd party purchase. The company posted 59.9% YoY growth to 439,516tons of FFB in 9M11 compared to 274,907tons a year earlier. FFB from plasma and 3rd party purchase also recorded significant growth in contribution to total FFB processed to 46.7% in 9M11 from 32.9% in 9M10. The CPO extraction rate, historically, recorded stable at average 23.5%. However, the CPO production experienced volatile growth within the past three years following volatile growth in total FFB processed where we accounted third party purchase as one of contributor for the volatility. With extraction rate assumptions at 23.1%, we expect LSIP to produce up to 541,562tons of CPO in 2020F with palm kernel production reach 129,477tons. In rubber plantations, LSIP posted decline in production within the last three years. Total production of rubber dropped to 18,492tons in 2010 from 21,806tons and 23,440tons in 2009 and 2008 respectively despite growth in mature rubber planted area. The company recorded rubber estates total 17,619ha in 2010, slightly higher compared to a year earlier at 17,330ha. The adverse weather especially wet morning rains took its toll affecting the effectiveness of rubber tapping and latex wash-out in both nucleus and plasma estates, accounted for declining rubber production last year. In 9M11, LSIP posted rubber
4

PP London Sumatra
production 10,931tons, dropped -27.1% YoY compared to a year earlier 14,986tons. Lower rubber nucleus production was due to less crop purchased from plasma and 3rd party. Comparing production of CPO, rubber and palm oil seeds, LSIP benefits for its diversified products mix where gain in one production can help to offset the loss in other production. In 2010, production in seeds grew 14.2% YoY higher, offsetting lower production in CPO and rubber that dropped -3.1% YoY and -15.2% YoY respectively. Exh. 1: Procentage Production Changes 2003 2010
80.0% 60.0% 40.0% 20.0% 0.0% -20.0% -40.0% -60.0% 2003 2004 2005 2006 2007 2008 2009 2010 CPO Palm oil seed (thousand) Rubber Others

Source: Company

Possible stable demand from parent company After acquired by PT Salim Ivomas Pratama (56.4%) and Indofood Agri Resources Ltd. (8.0%) back in 2007 where Indofood Agri Resources Ltd. then divested its shares in 2010 hence made PT Salim Ivomas Pratama Tbk. (SIMP) major shareholders, LSIP recorded growing sales to SIMP from 2007 only selling 0.5% of total sales to SIMP to 9M11 selling 64.5% of total sales. Exh. 2: Growing Sales to SIMP
2008 SIMP (Rpbn) 665.9 2009 976.6 2010 2,044.9 9M10 1,266.2 9M11 2,273.4

Procentage of total sales

Source: Company

17.3%

30.5%

56.9%

52.7%

64.5%

In addition, LSIP recorded increases in operating margin contributed by lower selling and distribution costs and G&A expenses. We see the decreases in both variables likely came from increases sales contribution to SIMP where LSIP recorded 0.5% selling costs ratio to sales in 9M11 compared to 0.9% selling costs ratio to sales a year earlier. The G&A expenses ratio to sales also dropped to 7.3% in 9M11 from 10.6% in 9M10. Going forward, we see this as positive note for LSIP as there will likely be stable demand from SIMP as LSIPs parent company with potential higher operating margin contributed by lower selling and distribution costs and G&A expenses.

PP London Sumatra Financial Highlights

Longer Cash Conversion Cycle (CCC) Before acquired by Indofood Group, LSIP recorded shorter cash conversion cycle with high inventory turnover. In 2005 2009, the company posted average CCC for 34 days, compared to 2010 for 41 days. This mainly contributed by lower inventory turnover where LSIP recorded faster turnover in inventory at average 9.2x compared to 2010 at 8.0x. Lower tax rate Benefiting from shareholding structure where public has more than 40% of ownership, LSIP recorded lower effective tax rate in 2010 to 25% from stable 30% since 2009 backward. This could benefit shareholder as residual income beneficiary with lower effective tax rate that will likely hold for some future time, can increase potential higher net income. Healthy Balance Sheet, Zero Debt In 9M11, LSIP recorded no debt obligation. The liquidity for the company are considered healthy with cash ratio averaging at more than 1.0 since year 2008. With healthy balance sheet where the company recorded cash up to Rp1.8tn in 9M11, LSIP has ample flexibility to further finance capex either from internal or external funding. Considering LSIP has massive landbank, the company may likely need capex only for adding processing mills capacity and maintaining plantation which with recent cash position, the company can use internal to fund the capex needed. Exh. 3: Liquidity & Activity Ratios
Current Ratio Quick Ratio Cash Ratio Cash Conversion Cycle (days) Inventory Turnover (x) Debt to Equity ratio
Source: Company

2005 0.5 0.3 0.2 35 9.5 1.3

2006 0.5 0.3 0.3 32 10.1 1.2

2007 1.1 0.7 0.7 37 8.6 0.7

2008 1.6 1.3 1.2 33 9.0 0.5

2009 1.4 1.1 1.0 34 8.9 0.3

2010 2.4 1.9 1.9 41 8.0 0.2

Potential for being dividend player With ample cash available, LSIP has the potential to be a dividend player where the company recorded distribution of dividend stable since 2009, distributing 30% of its FY2008 net profit at Rp208 per share, followed by distributing 40% of its FY2009 net profit at Rp209 per share and its FY2010 net profit at Rp61 per share.

PP London Sumatra VALUATION

Model Assumptions Assuming new planting at minimum 5,000ha per year, all landbank currently available up to 40,000k will be fully planted by the end of 2019F and all plantation area will be matured by 2024. This will lead LSIP to likely record up to 1.7mn tons of FFB harvested from nucleus plantation alone in 2020F using assumption FFB yield at 18.0tons/ha. Assuming CPO extraction rate at 23.1% forward on the basis of historical CPO extraction rate, total CPO will likely to reach more than 500k tons per year in 2020F. For projected prices, given the current volatility, we took conservative view on what average prices will likely to be. On the basis CPO prices tend will continue to hike amid volatility, we took a conservative view on pricing at US$900/MT for 2011E and 2012F; US$950/MT for 2013F and 2014F and US$1,000/MT for 2015F and forward. Exh. 4: Historical CPO Prices
Month Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11
Average

Price (US$/MT) 1,238.57 1,248.55 1,142.23 1,123.79 1,143.44 1,075.91 1,033.57 1,047.51 995.18 914.44
1,096.32

Source: Index Mundi

Exh. 5: CPO Prices Trend (2001 Oct11)

1400 1200 1000 US$/MT 800 600 400 200 0 Oct-01 Oct-02 Oct-03 Oct-04 Oct-05 Oct-06 Oct-07 Oct-08 Oct-09 Oct-10 Oct-11 Price (US$/MT) Linear (Price (US$/MT))

Time

Source: Index Mundi

Other key assumptions used in our base case model: - WACC applicable for discounting of future projects cashflow is 16.7%. - Effective tax rate = 20% - Exchange rates Rp9,000/US$ - Terminal growth of 2%. To estimate the target price, we employed DCF based valuation where LSIP value depend on the present value of future cash flow the company is expected to receive further. We initiate our coverage on LSIP with a Buy recommendation with a target price of Rp2,675, which represents 24.4% potential upside. We like LSIP for its massive landbank, relatively young age plantation profile, diversified products, and healthy balance sheet.

PP London Sumatra
Exh. 6: LSIP 9M11 results
Rpbn Revenue Gross Profit Operating Income Other Income Income Tax Net Income Gross Margin Operating Margin Net Margin 9M10 2,403.1 1,155.8 843.4 22.8 (224.3) 641.8 48.1% 35.1% 26.7% 9M11 %YoY 1Q10 680.2 324.6 238.2 (12.9) (57.4) 167.9 47.7% 35.0% 24.7% 2Q10 886.2 425.7 312.0 26.3 (88.4) 249.9 48.0% 35.2% 28.2% 3Q10 836.7 405.4 293.2 9.4 (78.6) 224.1 48.4% 35.0% 26.8% 4Q10 1,189.5 615.6 556.1 (40.5) (124.2) 391.5 51.8% 46.8% 32.9% 1Q11 1,175.8 624.5 528.0 (2.1) (131.7) 393.9 53.1% 44.9% 33.5% 2Q11 1,207.0 641.3 529.2 37.5 (74.5) 492.4 53.1% 43.8% 40.8% 3Q11 1,140.0 571.5 495.8 25.5 (95.2) 426.1 50.1% 43.5% 37.4% QoQ (%) -5.6% -10.9% -6.3% -31.9% 27.8% -13.5% -5.6% -0.8% -8.4%

3,522.9 46.6% 1,837.4 59.0% 1,552.9 84.1% 60.9 167.5% (301.3) 34.4% 1,312.4 104.5% 52.2% 44.1% 37.3% 8.4% 25.6% 39.5%

Rpbn Revenue COGS Gross Profit EBITDA Operating Cost Operating Profit Other Inc./Exp. Pre-Tax Profit Income Tax Net Profit Rpbn Cash & Investment Receivable Inventories Other Curr. Assets Fixed Assets Other Assets Total Assets Account Payables Other ST Liabilities Long Term Debt Other LT Liabilities Total Liabilities Equity

2008 3,846.2 1,985.4 1,860.8 1,440.1 546.4 1,314.4 12.3 1,326.7 (399.2) 927.6 2008 1,034.3 99.2 213.7 52.5 1,377.6 2,143.9 4,921.3 132.8 717.4 609.5 264.6 1,724.3 3,197.1 2008

2009 3,199.7 1,809.2 1,390.5 1,171.4 371.8 1,018.7 (10.5) 1,008.1 (300.7) 707.5 2009 682.2 65.0 192.1 25.0 1,603.5 2,277.5 4,845.4 92.5 587.0 30.3 322.1 1,031.9 3,813.5 2009 1,174 422.4 19.0 6,400 16,427

2010 3,592.7 1,821.2 1,771.4 1,597.6 371.9 1,399.5 (17.7) 1,381.8 (348.5) 1,033.3 2010 1,160.7 64.8 264.5 36.1 1,728.7 2,345.5 5,561.4 118.0 503.6 385.7 1,007.3 4,554.1 2010 1,170 415.1 17.1 7,000 29,292

2011F 4,161.8 1,869.8 2,292.0 2,111.2 382.3 1,909.7 90.1 1,999.8 (374.0) 1,625.8 2011F 1,511.4 83.2 388.9 24.7 1,892.9 2,724.0 6,625.1 172.8 472.2 450.5 1,095.5 5,529.6 2011F 1,204 426.8 17.0 7,258 34,497

2012F 4,378.7 2,022.0 2,356.6 2,207.3 391.5 1,965.1 90.9 2,056.1 (411.2) 1,644.8 2012F 2,171.6 87.6 411.8 28.4 2,041.4 2,933.8 7,674.7 186.9 500.9 470.2 1,158.1 6,516.5 2012F 1,321 468.4 17.0 7,258 31,048

Rpbn Net Income Depreciation Chg. In Working Capital CF from Operation Capex Others CF from Investment Change in Debt Others CF from Financing Net Cash Flow Cash at Start Cash at End

2008 927.6 114.8 (74.1) 968.3 (329.6) (270.2) (599.8) 138.1 (31.6) 106.5 475.0 558.4 1,034.3 2008

2009 707.5 142.6 74.7 924.8 (305.0) (228.9) (533.9) (709.4) (33.6) (743.0) (352.1) 1,034.3 682.2 2009 -16.8% -25.3% -22.5% -18.7% -23.7%

2010 1,033.3 197.4 114.7 1,345.5 (245.4) (164.5) (409.9) (228.1) (229.0) (457.1) 478.4 682.2 1,160.7 2010 12.3% 27.4% 37.4% 36.4% 46.1%

2011F 1,625.8 201.5 (168.6) 1,658.8 (300.0) (422.5) (722.5) (585.5) (585.5) 350.7 1,160.7 1,511.4 2011F 15.8% 29.4% 36.5% 32.1% 57.3%

2012F 1,644.8 242.2 (13.3) 1,873.7 (300.0) (275.3) (575.3) (638.2) (638.2) 660.3 1,511.4 2,171.6 2012F 5.2% 2.8% 2.9% 4.6% 1.2%

Growth (%) Revenue Gross Profit Operating Profit EBITDA Net Income Others (%) Gross Margin Operating Margin EBITDA Margin Net Margin ROE ROA Net Gearing Valuation (x) PER PBV EV/EBITDA

31.3% 32.5% 32.6% 45.3% 64.5%

Key Assumption FFB Harvested ('000 tonnes) FFB Third Parties ('000 tonnes) FFB Yield (tons/ha) CPO ASP (Rp/kg) Rubber ASP (Rp/kg)

48.4% 43.5% 49.3% 55.1% 53.8% 34.2% 31.8% 39.0% 45.9% 44.9% 37.4% 36.6% 44.5% 50.7% 50.4% 24.1% 22.1% 28.8% 39.1% 37.6% 29.0% 18.6% 22.7% 29.4% 25.2% 18.8% 14.6% 18.6% 24.5% 21.4% net cash net cash net cash net cash net cash

1,022 433.2 17.8 7,500 629

21.5 4.1 13.6

80.5 11.8 16.2

84.8 15.8 11.5

11.5 3.4 8.2

11.0 2.8 7.2

PP London Sumatra
RESEARCH
Bagus Hananto bagus.hananto@ocap.co.id (62-21) 3190-1777 ext. 219

Sheila Yovita

sheila.yovita@ocap.co.id

(62-21) 3190-1777 ext. 220

EQUITY SALES
Dick Hermanto dick.hermanto@ocap.co.id (62-21) 3162-063

Widya Halim

halim.widya@ocap.co.id

(62-21) 3162-072

Maria Fransisca

maria.fransisca@ocap.co.id

(62-21) 3162-062

Chelsia Chen

chelsia.chen@ocap.co.id

(62-21) 3162-074

Agi Susanti

agi.susanti@ocap.co.id

(62-21) 3162-075

Siti Qobtiah

tia@ocap.co.id

(62-21) 3162-065

Supardi

supardi@ocap.co.id

(62-21) 3162-025

PT ONIX Capital Tbk.

Deutsche Bank Building #15-04 Jl. Imam Bonjol No. 80 Jakarta 10310 Indonesia Phone. (62-21) 3190-1777 (hunting) Fax. (62-21) 3190-1616

Rating Definitions
BUY: HOLD: SELL : We expect this stock to give total return of above 15% over the next 12 months. We expect this stock to give total return of between -15% up to 15% over the next 12 months. We expect this stock to give total return of -15% or lower over the next 12 months.

DISCLAIMER:
This report was produced by PT ONIX Capital Tbk., a member of Indonesia Stock Exchange (IDX). The Information contained in this report has been obtained from public sources believed to be reliable and the options, analysis, forecasts, projections and expectations contained in this report are based on such information and are expressions of belief only. No representation or warranty, expressed or implied, is made that such information or opinion is accurate, complete or verified and it should not be replied upon as such. This report is provided solely for the information of clients of PT ONIX Capital Tbk. who has to make their own investment decisions without reliance on this report. Neither PT ONIX Capital Tbk. nor any officer or employee of PT ONIX Capital Tbk. accept any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents. PT ONIX Capital Tbk. may be involved in transactions contrary to any opinions herein to make markets, or have positions in the securities recommended herein. PT ONIX Capital Tbk. may seek or will seek investment banking or other business relationships with the companies within this report. This report is a copyright of PT ONIX Capital Tbk. For further information please contact us at (62-21) 3190-1777 or fax (62-21) 3190-1616.