PT Kawasan Industri Jababeka Tbk. Investor Presentation November 2017 0
Leading township developer & infrastructure powerhouse PT Kawasan Industri Jababeka Tbk. ("KIJA") is a leading township developer with an established track record in industrybased townships supported by residential & commercial components... KIJA overview Real Estate PT Kawasan Industri Jababeka Tbk Infrastructure Business segments FY16 Revenue Breakdown (%) (Rp 2,931 billion) Infrastructure & Port 14% Industrial Residential Commercial Power Infrastructure Dry Port Power Plant 45% Real Estate & Others 41% Established in 1989 and became the first publicly listed industrial estate developer in Indonesia in 1994 Kota Jababeka, KIJA's flagship development, is a mature industrybased integrated township in Cikarang with on-site power plant and dry port Pipeline projects: Kendal Industrial Park Park by the Bay in Central Java, tourism-based township in Tanjung Lesung, Banten and a tourism development project in Morotai Large and strategically located land bank of 3,363 hectares as of 30 June 2017 Vision: To Create Modern Self Sustained Cities in Every Province in Indonesia and Provide Jobs for Better Life Power Plant 13% FY16 Gross Profit Breakdown (%) (Rp 1,243 billion 42% GPM) Infrastructure & Port 16% Real Estate & Others 71% with world class infrastructure to support its development 1
Established track record in large-scale industrial estate + infrastructure More than 25 years track record in industrial township development Selected awards #1 #1 Investor Magazine - 2012 Top 10 Best performing listed companies and Best listed company in property Indonesia Property Watch- 2015 The best township development concept Fortune Indonesia - 2015 Best Company award SWA Magazine - 2016 Top 25 Most Creative Companies in Indonesia 2016 1989 #1 Frontier Consulting Group Award 2014 #1 Corporate Image Industrial Estate Jababeka Group established and started development of the industrial estate 1994 IPO on Jakarta and Surabaya Stock Exchange Supply Chain Asia Awards 2014 Asia Logistics Centre/Park of the Year 1996 Acquisition of Menara Batavia in Jakarta CBD 2001 2003 Inauguration of Education Park, including President University #1 Ministry of Industry - 2015 Best Industrial Estate Infrastructure & Facilities Commenced development of Jababeka CBD 2010 Cikarang Dry Port begins operations 2011 Acquisition of 1,500 ha land in Tanjung Lesung, Banten 2013 2014 Bekasi Power Plant commenced operations D Khayangan Senior Living Launched Groundbreaking Kendal Industrial Park Park by the Bay 2
Sizeable land bank in strategic locations with upside potential Kota Jababeka Cikarang Master plan: 5,600 hectares 35km east of Jakarta Land Bank: 1,228ha (1) Fully integrated and matured city development 35km east of Jakarta, 45mins from Jakarta s CBD Most established industrial area in Greater Jakarta, home to >2,000 local and multinational companies INDONESIA Tanjung Lesung Kota Jababeka Cikarang Kendal, Central Java Semarang Surabaya Karawang Designated as a Special Economic Zone Located 170km southwest of Jakarta and covers 1,500 ha of untouched peninsula facing the Indian Ocean Envisaged to become a first-class integrated resort destination for both domestic and international tourists Note: 1 Land bank as at 30 June 2017 Tanjung Lesung Master plan: 1,551 hectares 170km southwest of Jakarta Land Bank: 1,551ha (1) Kendal, Central Java Master plan: 2,700 hectares 450km east of Jakarta Land Bank: 584ha (1) Offers a deep pool of young and skilled labour at a competitive cost Designated strategic estate status under presidential decree Strategically located along the Jakarata-Semarang- Surabaya Economic Corridor 3
Overview of Portfolio Three diversified pillars of growth underpinned by strong recurring revenue base Real Estate (1) Industrial Water Treatment Plant Infrastructure Waste Water Treatment Plant Leisure & Hospitality Golf & Country Club Senior Living @D Khayangan The Jababeka Industrial Estate Residential Veranda Commercial D Cataluna Candi Residence at D Java The Oscar Beverly Hills D Java Residence Tropikana Garden Graha Asri Riverview Residence Kota Jababeka Bekasi Power Cikarang Jababeka Golf & Country Club President Lounge Magelang Borobudur International Golf & Country Club Ruko Hollywood Arcade Thamrin Boulevard East Park Commercial Centre Boulevard Arcade Education Park Ruko D Java Sentra Niagra Square Movie Boulevard Cortes Resto Plaza Trace Rodeo Drive Hollywood Boulevard Ruko Green Market Kios Green Market Riverwalk Cikarang Dry Port Main Lobby, The President Lounge - Jakarta Metro Suites Metro Hotel Kota Jababeka Botanic Garden Kota Jababeka Education Park Note: 1 KIJA also owns 5,947 sqm of space in the Jakarta strata title building Menara Batavia and has title to 12,035.7 sqm in The City Center, a strata titled office tower adjacent to Menara Batavia Jababeka Botanic Gardens 4
Key credit strengths 1 Leading industry-based integrated township developer in Indonesia 2 The ONLY industrial developer with on-site power and dry port 3 Stable, USD-denominated recurring income from infrastructure operations 4 Diversified land bank and projects 5 Clear strategic focus over different time frames 6 Robust operating and financial performance 7 Experienced management team 8 Beneficiary of favourable macro and sector fundamentals 5
1 Kota Jababeka Flagship industry-based integrated township Kota Jababeka is a mature industry-based township strategically located in close proximity to Jakarta CBD, sea port and airport Toll Road Future Toll Road Soekarno-Hatta International Airport Tanjung Priok Port Heavy industries & Petrochemicals Tangerang DKI JAKARTA (in km) Distance from Kota Jababeka South Tangerang Bekasi Automotive, Consumer, Electronics & other Light to medium industries Jakarta CBD 35 Seaport 55 Kota Jababeka Airport 65 1 2 3 4 Strategically located in Cikarang area, the most established industrial estate zone in Greater Jakarta Close to central Jakarta, sea-port, airport and accessible by both toll and railroads Mature township with a well-established talent/labour pool supported by complementary facilities (residential, commercial, hospitality, etc) Superior infrastructure facilities which serve to enhance Kota Jababeka's competitive positioning for customers and is home to over 1,600 local and multinational customers from over 20 countries 6
1 Kota Jababeka Anchored by a blue-chip customer base The portfolio of high quality multinational and domestic customers at Kota Jababeka is a testament to the township's strategic location and superior infrastructure facilities Diverse mix of occupants across sectors (breakdown by number of occupants) As of 30 June 2017 Portfolio of high quality customers Electronics 11.4% Consumer Goods 6.7% Others 44.2% Machinery 6.6% Chemicals 6.0% Textile 1.8% Buidling 3.6% Metal Fabrication 3.8% Foods 4.6% Plastics 5.5% Automotive 5.7% 7
1 Kota Jababeka Continued build-out of complementary facilities Kota Jababeka has successfully achieved a critical mass of occupants which provides an opportunity to continue introducing complementary services and infrastructure to enhance the township's value proposition Housing clusters Residential The Veranda Tropikana Garden D Java Residence Senior housing Simprug Garden High-rise residence D Khayangan - Senior living Elvis Tower Commercial Sentra Niaga Square Simprug Plaza 8
1 Kota Jababeka Enhancing value through Joint Venture projects PT PP Properti (Persero) Tbk PT Plaza Indonesia Realty Tbk JV 1 51% 49% Riverview Residence JV 1 30% 70% MAYFAIR Estate & Park Land 4 apartment towers strategically located near the toll exit Catering to the lower end of the market Tower 1 Mahakam Tower 90% sold out; Tower 2 to be launched in late 2017 / early 2018 Mixed use superblock on a 12-ha site right next to the golf course Groundbreaking happened in June 2015; piling completed in 2016, construction expected to start in late 2017 / early 2018 Expected completion: 2020 JV 2 47.4% 52.6% 70% Mixed use superblock on a 4.6-ha site With 6 apartment towers and Japanese style mall JV 2 30% To be developed on 4-ha site adjacent to JV 1 Concept to be decided on at a later stage to support / complement JV 1 9
2 Enhancing Kota Jababeka's value proposition: Bekasi Power Plant KIJA is the only industrial estate developer in Indonesia with its own power plant located within its estate Integrated Power Generation & Distribution Process 130MW gas fired combined cycle plant Financial Highlights IDR billion 1,600 1,400 1,200 1,000 800 600 400 200-1,062 7.7% 82 1,267 1 2 3 12.2% 155 100% output to PLN Buy back from PLN (+16% margin) Direct sale to factories (+ margin) 1,499 1,310 14.3% 12.5% 215 765 16.7% 164 127 2013 2014 2015 2016 1H17 Revenue Gross Profit Gross Profit Margin PLN Factories 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 20 year 100% off-take agreement from Perusahaan Listrik Negara ( PLN ) Rate per KWH: ~US$11 cents Average gas cost / MMBTU: ~US$9.0-10.0 Fuel costs borne by PLN on a pass-through basis Fully contracted gas supply Flexibility to buy back power and resell it at a premium In 2Q 2016, a leakage was found in a boiler of one of the Heat Recovery Steam Generators of the power plant. The repair was successfully completed in mid August 2016. During the repair, power plant operated at about 50% of the usual capacity Operational Highlights Description 2014 2015 2016 1H17 Net Dependable Capacity 118.8MW 120MW 120MW 121.2MW Load Factor 108MW 110MW 93MW 108MW Capacity factor 90.01% 90.01% 81.85% 93.62% Equivalent Availability Factor 90.34% 96.39% 82.85% 98.70% Planned Outage Factor 7.88% 3.09% 15.15% 0.58% Equivalent Forced Outage Rate 1.78% 0.52% 2.00% 0.07% Providing a significant marketing advantage over its competitors as access to reliable electricity supply is one of the primary concerns for industrial clients in Indonesia 10
2 Enhancing Kota Jababeka's value proposition: Cikarang Dry Port Strategic location in the heart of the largest manufacturing zone along the Bekasi-Cikampek industrial corridor Enhanced Accessibility with New Toll Gate KM 29 Cikarang Utama Toll Gate Highway Exit KM 29 New Toll Gate KM 29 MM 2100 EJIP LIPPO JABABEKA 62% 1 HYUNDAI GIIC SURYA CIPTA Flyover to Jakarta KIIC KIM KIKC KBI International Port Code: IDJBK Surrounded by 11 Industrial Estates and more than 3,000 manufacturing companies with excellent transport connectivity Notes: 1 Estimated % of total throughput at Tanjung Priok Port originating from this area 11
2 Enhancing Kota Jababeka's value proposition: Cikarang Dry Port Facilities & services offered at Cikarang Dry Port Container Yard Reefer Services Terminal Operation 24/7 Bonded Trucking Container Freight Station Rail Freight Service 24/7 Security New 10,000 m2 warehouse New Customs Office Office: CDP, Quarantine, Banking Bonded Logistics Center Gate To Surabaya CFS Reefer Mobile X-Ray Physical Inspection Railway Emplacement To Jakarta / Tanjung Priok Bonded Logistics Center Special Containers Handling Integrated Customs & Quarantine Empty Container Depot Online Tracking & INSW Connected 12
2 Enhancing Kota Jababeka's value proposition: Cikarang Dry Port Cikarang Dry Port (CDP) is the first and only integrated customs, quarantine and logistics facility in Indonesia Overview Strong momentum in CDP operations Since 2012, Cikarang Dry Port is an official port of origin and Revenue (IDR billion) destination with international port code IDJBK now connected 160 with 29 major shipping lines Integrated port and logistics facilities with multi modal transportation services Besides export/import, CDP also serves as hub for domestic distribution via main railway line that runs from west Java to east Java Bonded Logistics Centre (FTZ facilities) for Cotton & minerals/metals with a 2 nd warehouse completed in 1Q 2017 to accommodate more cotton traders and other commodities Selected customer & partner profile at Cikarang Dry Port Shipping Lines: Third Party Logistics Provider (3PL): Shippers / Consignees: 140 120 100 80 60 40 20-70,000 60,000 50,000 40,000 30,000 20,000 15 Throughput (TEU) 62 25,808 78 37,507 120 50,844 151 2012 2013 2014 2015 2016 1H17 65,250 79 33,757 10,000-5,995 2012 2013 2014 2015 2016 1H17 allowing customers to more efficiently manage their imports and exports and benefit from cost savings 13
3 Sizeable and stable USD-denominated recurring income base The provision of these infrastructure services has enabled the progressive build out of a significant recurring revenue base Total Revenue & Breakdown Recurring revenue (IDR billion) 2016 2000 1800 1,868 1,723 2014 41% 59% 1600 1400 1200 1,349 1,592 43% 57% IDR 2,931 billion 1000 977 800 2012 83% 17% IDR 2,799 billion 600 400 200 240 IDR 1,401 billion Recurring (1) Real Estate (2) 0 2012 2013 2014 2015 2016 1H17 based on USD pricing terms (power & water), further enhancing stability and visibility of cash flows for Jababeka and also providing a natural hedge for its USD-denominated interest expenses Notes: 1 Recurring revenue/ebitda includes contribution from power plant, dry port and service & maintenance fees 2 Comprises real estate, golf and other non-infrastructure segments 14
4 Diversified land bank A geographically diversified land bank allows KIJA to capture different market segments and enhances earnings resilience Diversified by geography, positioning and segment Land Bank Total (1) : 3,363ha Kota Jababeka Kendal Industrial Park Park by the Bay Tanjung Lesung Positioning Established MNCs and domestic companies willing to pay a premium for strategic location and mature township with top notch infrastructure in place (1,228ha) (584ha) (1,551ha) More cost-conscious customers looking for an alternative to Greater Jakarta industrial estates that still provides top notch infrastructure Tourism, leisure and hospitality focused integrated township to tap into entertainment/leisure spending by rising middle class in Indonesia Well diversified across multiple segments (Breakdown of segments by 2016 revenue contribution) Real Estate (2) : 41% Recurring (3) : 59% 22% 3% 6% 7% 1% 2% 45% 14% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Land Industrial Commercial Residential Tourism Golf Power Plant Service & Maintenance in addition to benefiting from future infrastructure developments across its land bank locations Notes: 1 Excluding Morotai, with 29ha of land bank 2 Comprises real estate, golf and other non-infrastructure segments 3 Recurring revenue includes contribution from power plant, dry port and service & maintenance fees 15
4 Diversified projects: Kendal Industrial Park Park by the Bay Kendal Industrial Park Park by the Bay benefits from Sembcorp's expertise in developing and marketing industrial zones across Asia (China, Vietnam, Batam, Bintan, etc) Kendal Industrial Park Park by the Bay is a JV between KIJA and Sembcorp Excellent connectivity to major infrastructure in Central Java 49% 51% Kendal Port Tanjung Emas Seaport Ahmad Yani Int'l Airport Semarang Total planned area: 2,700 hectares Phase 1: 860 ha (584 hectares as of 30 June 2017) Distance to Kendal Industrial Park Park by the Bay Tanjung Emas International Seaport (Indonesia's 3 rd largest) Ahmad Yani International Airport Semarang (Central Java capital) 25 km 20 km 21 km and complemented by KIJA s long track record and experience in Indonesia industrial estate developments and infrastructure operations 16
4 Diversified projects: Kendal Industrial Park Park by the Bay Our Kendal Industrial Park Park by the Bay development in Central Java is well-positioned to benefit from growing demand for relatively low cost industrial estates with good connectivity and competitive labor costs Key Highlights Kendal Industrial Park Park by the Bay offers customers an affordable product with top notch infrastructure Low labour costs in Central Java makes Kendal Industrial Park Park by the Bay particularly interesting for labor intensive industries Kendal Industrial Park Park by the Bay is situated along the Jakarta-Semarang-Surabaya Economic Corridor Increasing traffic congestion at Tanjung Priok Port in Jakarta has led to growing interest in alternative sites with good connectivity via air and sea Diverse mix of occupants across sectors (breakdown by number of occupants) As of March 2017 Manufacturing, 24% Textile & Garment, 4% Furniture, 16% Food, 12% Official opening ceremony on November 14 th 2016 by the President of Indonesia, Mr Joko Widodo, and the Prime Minister of Singapore, Mr Lee Hsien Loong Logistic & Warehouse, 12% Building & Related, 32% 17
4 Diversified projects: Kendal Industrial Park Park by the Bay 18
4 Diversified projects: Tanjung Lesung Malaysia Tanjung Lesung overview Singapore Indonesia Tanjung Lesung Location Concept ~ 170 km southwest of Jakarta in Banten Tourism-based integrated township apartments, sailing, diving & beach clubs) (hotels, Australia Access Currently accessible by toll road from Jakarta in ~ 3.5 hours Merak SOEKARNO HATTA International Airport Krakatau Mountain Anyer Serang Jakarta Tanjung Lesung Panaitan Island Labuan Panimbang Pandeglang Future Toll road Jakarta-Merak Toll Road Ujung Kulon National Park President Joko Widodo speaking on Tanjung Lesung s designation as Special Economic Zone for Tourism 19
4 Diversified projects: Tanjung Lesung Strong government support for Tanjung Lesung's development as a tourism zone... Facilities and infrastructure at Tanjung Lesung Existing infrastructure includes access roads, a water treatment plant, wastewater treatment plant, electricity supply and telecommunication links Visitors currently have access to ~ 300 rooms spread out over two hotels/resorts, a bed and breakfast and several cottages Other facilities: restaurant and bar, driving range, a swimming pool, a spa, a beach club, a sailing club, school, mosque, residential housing units, and a medical clinic Golf course Strong government support for development of Tanjung Lesung One of 10 New Tourism Destinations in Indonesia that the Indonesian Government is promoting Aerial view New toll road from Serang Timur to Panimbang: A consortium led by PT Wijaya Karya Tbk (Persero) won the tender for this project Tanjung Lesung has been designated as Special Economic Zone for Tourism Villa with private pool at Tanjung Lesung is expected to increase interest from potential investors/partners for the project 20
4 Diversified projects: Tanjung Lesung Current property products KALICAA VILLA 21
4 Diversified projects: Morotai Future tourism and logistics hub strategically located in the heart of Pacific Asia with natural tropical beauty and World War 2 charm Morotai Strategically located in the Halmahera group of eastern Indonesia s Maluku islands, in the heart of Pacific Asia in between Asia and Australia 3 hours flight from Singapore and Taipei Great potential for tourism, agricultural and fishing industries and as a logistics hub Morotai is a Special Economic Zone for tourism and 1 of 10 new tourism destinations promoted by the government Beach view at Morotai PT Jababeka Morotai has been appointed as the implementing entity of the Morotai development project by the Coordinating Ministry of Economic Affairs of the Republic of Indonesia Currently holds 29ha of land bank at Morotai for development Evening view at Morotai 22
5 Clear strategic focus KIJA's existing pipeline provides visible opportunities over different time frames Continue to develop and capitalize on Kota Jababeka Township Expansion of power segment in Kota Jababeka Short Term Further development of Kendal Industrial Park in partnership with Sembcorp in Central Java Medium Term Development of Tanjung Lesung tourism-based township Long Term Vision Replicate Kota Jababeka's industry-based integrated township model throughout Indonesia Build out an infrastructure facility portfolio (power, water, ports, etc.) to support these new townships 23
6 Strong financial performance... Revenue breakdown (IDR billion) Gross profit (IDR billion) and Gross profit margin (%) 3,500 3,140 1,600 2,931 61% 1,389 1,252 3,000 2,740 2,799 1,400 1,171 1,243 1,200 2,500 1,272 1,208 1,207 1,000 860 39% 2,000 1,390 1,613 43% 45% 800 44% 1,401 42% 1,500 636 600 1,000 626 1,161 1,868 400 1,349 1,592 1,723 500 977 200 0 240 0 2012 2013 2014 2015 2016 1H17 2012 2013 2014 2015 2016 1H17 70% 60% 50% 40% 30% 20% 10% 0% Recurring Revenue Real Estate & Other Revenue Gross Profit Gross Profit Margin EBITDA (IDR billion) and EBITDA margin (%) 1,200 53% 1,089 1,082 1,019 1,000 925 800 741 600 37% 39% 29% 34% 32% 400 470 200 0 2012 2013 2014 2015 2016 1H17 60% 50% 40% 30% 20% 10% 0% Net income (IDR billion) 450 400 350 300 250 200 150 100 50 0 380 (1) 101 (1) 399 (1) 331 427 218 2012 2013 2014 2015 2016 1H17 (1) (2) (2) EBITDA EBITDA Margin Notes: 1 Approximate unrealized foreign exchange loss (non cash) for FY12: IDR 62 billion, FY13: IDR 420 billion, FY14: IDR 65 billion and FY15: IDR 156 billion 2 FY16 & 1H17 include unrealized foreign exchange gains (non cash) of approximately IDR 135 billion and IDR 28 billion respectively 24
6 Robust balance sheet position Assets and cash (IDR billion) 12,000 10,734 11,198 10,000 9,741 8,255 8,509 8,000 7,078 6,000 9,942 10,132 8,914 7,660 7,911 4,000 6,836 2,000 0 242 595 595 827 792 1,066 2012 2013 2014 2015 2016 1H17 Debt, Equity (IDR billion) and Debt/Equity (x) 7,000 6,000 5,639 5,848 4,978 5,000 4,645 3,975 4,186 3,410 3,565 3,788 4,000 3,000 2,572 2,684 2,046 0.71 2,000 0.63 0.65 0.61 0.58 1,000 0.51 0 2012 2013 2014 2015 2016 1H17 1.00 0.80 0.60 0.40 Cash and Cash Equivalents Total Assets Total Debt Total Equity Debt / Equity EBITDA/Interest expense (x) 1 Net debt/ltm EBITDA (x) 4.0 3.5 3.0 3.2 3.8 3.7 3.1 2.8 2.9 3.5 3.0 2.5 2.4 2.5 3.0 2.8 2.5 2.0 1.5 1.0 0.5 2.0 1.5 1.0 0.5 1.9 1.9 0.0 2012 2013 2014 2015 2016 1H17 0.0 2012 2013 2014 2015 2016 LTM Jun'17 Notes: 1 Includes capitalized interest + Hedging Fees 25
6 Conservative Capital Management Strategy Proactive approach in managing maturities in line with KIJA s long term growth plans Proactive Capital Management Strategy Illustrative Debt Maturity Profile (1) (IDR bn) Proactive Approach to Managing Debt Borrowing and Leverage In 2016, KIJA successfully executed a liability management exercise for the second time by issuing US$189m bonds to refinance US$260m bonds maturing in 2019 About 65% of the 2019 Bondholders exchanged their bonds with new bonds maturing in 2023 As a result, KIJA was able to issue the 2023 (S&P / Fitch: B+) 7 year tenor bonds at 6.5% as compared to the 2019 5 year tenor bonds at 7.5% KIJA has consistently kept its debt/equity ratio between 50% to 70% KIJA s EBITDA / interest expenses has consistently been maintained at 2.8x to 3.8x Extension of Average Term to Maturity from 4.6 years to 6.0 years 3,929 2,291 Hedging Practice Increasing recurring income base of 59% provides stability and visibility of cash flows US$200m notional currency hedge against IDR depreciation via call spreads with avg lower strike of IDR 13,021 and avg upper strike of IDR 15,946, aligning position with tenor of new 2023 bonds 1,241 Prudent Approach to Capex Limited to maintenance and development of infrastructure facilities Discretionary nature of land acquisitions and construction costs partly contingently on meeting sales thresholds in current period 87 90 49 24 2017 2018 2019 2020 2021 2022 2023 Senior Notes Bank Loans Notes: (1) As at 30 Jun 2017, assuming full refinancing of USD 13.3m SCB Term Loan facility (2) Based on an indicative exchange rate of 1 USD : 13,319 IDR 26
7 Experienced management team Average of more than 20 years of industrial township development experience Board of Commissioners Setyono Djuandi Darmono President Commissioner (Founder) Bacelius Ruru Vice President Commissioner Independent Commissioner Hadi Rahardja Commissioner (Founder) Gan Michael Commissioner Ketut Budi Wijaya Commissioner / Independent Commissioner Board of Directors Budianto Liman Hyanto Wihadhi Sutedja Sidarta Darmono Tjahjadi Rahardja Setiawan Mardjuki President Director Director Director Director Director 27
China India US Indonesia Brazil Pakistan Nigeria Bangladesh Russia Japan Mexico Philippines Ethopia Vietnam Egypt Germany Iran Turkey Congo Thailand UK France Italy S.Africa Tanzania Myanmer Korea Colombia Kenya Spain 324 258 206 193 286 163 147 128 128 103 102 95 91 83 80 80 79 65 65 65 59 56 56 53 51 49 48 46 1,366 1,324 8 Favourable macro and sector fundamentals Strong real GDP growth outlook (%) 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 6.4 6.2 6.0 5.6 5.0 4.9 5.0 5.1 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F 4.8 5.0 Continued growth in direct investments both FDI and domestic (IDR trn) 700 600 500 400 300 200 100 0 251 76 175 313 92 221 398 128 463 156 270 307 546 180 613 216 366 397 2011 2012 2013 2014 2015 2016 H1 2017 337 130 207 Source: Statistics Indonesia, EIU August 2017 Source: BKPM FDI Domestic Direct Investment Total Sizeable domestic market size world's 4 th largest population Greater Jakarta average industrial land prices (USD/sqm) 1,600 250 1,400 1,200 1,000 800 600 400 200 200 150 100 50 56 62 81 114 118 159 174 169 187 191 0 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 H1 2017 Source: EIU Population Data as of September 2017 Source: Colliers Indonesia International research 28
8 Favourable macro and sector fundamentals Government Budget on Infrastructure Spend in Indonesia (IDRtrn) Government initiatives to stimulate industry FDI in Infrastructure-related Sectors in Indonesia (USDbn) 12,000 10,000 8,000 6,000 4,000 2,000 0 347 317 290 209 178 139 2014 2015 2016 2017 Budget Actual 10,298 11,291 9,320 9,637 8,818 9,015 5,819 4,366 2010 2011 2012 2013 2014 2015 2016 Q2 2017 1 Upgrading of Infrastructure 2 Deregulation of Investment and Tax Incentives Capital spending on ailing infrastructure network gained traction from late 2015 Upgrades to ports, roads, toll roads and power plants Jakarta airport railway Trans-Sumatera toll road New Jakarta container terminal (New Priok) New Terminal 3 at Jakarta airport Equity injections into infrastructure-related State Owned Enterprises ( SOEs ) Further streamlining and improvements to the land acquisition process critical for infrastructure development and a bigger budget allocated to the new land acquisition agency Improvement in investment climate via cutting red tape and easing bureaucracy Restrictions on foreign participation in several logistics related sectors have been loosened Licenses have already been granted to operate bonded logistics centre Secured funding from international development agencies Mining Electricity, Gas & Water Supply Transport, Storage & Communication Construction Introduced many regulatory reforms to create a more conducive environment for private sector participation in infrastructure Notes: Source: PWC: Indonesian Infrastructure Report ; Ministry of Finance; BKPM 29
Thank You www.jababeka.com 30