Riset ELTY by SJ Seymour

October 15, 2010
SJS Markets Credit Research

Dominic Soon
Credit Analyst
+852 2868 9920

PT Bakrieland Development Tbk
dsoon@sjs-group.com
www.sjs-group.com Recommendation: BUY
Bloomberg: SJSG
Exhibit 1: Capitalisation Structure Initiating with a BUY on ELTYIJ 8.625% Conv. Notes due 03/15
In IDR bn We are initiating with a BUY on ELTYIJ 8.625% Conv. Notes due 03/15 on its
(1)
LTM Period 30 June 2010 Last FY Pro Forma sufficient NAV coverage, attractiveness on relative value, cash flow visibility
Sales 1,227.7 1,227.7 from toll roads and hotels business, coupled with a strong macroeconomic
EBITDA 241.3 241.3 outlook for the Indonesian economy. However, key risks include Bakrieland’s
EBITDA Margin 19.7% 19.7% (ELTY) expansion plan which is likely to require additional debt financing.
ST bank loans 27.5 27.5 Conservative NAV Estimate Adequately Covers Convertible Bonds
Onshore bank debt 2,089.0 2,089.0 Outstanding
Total Bank Debt 2,116.4 2,116.4
Following ELTY's recent land acquisitions in Bogor and Jonggol, we estimate
that the NAV of the company's land bank, toll road, and equity stake in PT
Loans from other fin. Institutions 408.7 1,775.7
Sentul City covers the convertible bonds more than five times after deducting all
Capital leases 3.7 3.7
other bank and onshore debt. Thus, in the worst case scenario, we think that
Total Bank & Fin. Institutions 2,528.9 3,895.9
the recovery on the bonds should be at least par.
ELTYIJ 11.9% 03/11 220.0 220.0
ELTYIJ 12.85% 03/13 280.0 280.0 ELTYIJ’15s Appear Attractive On Relative Value
ELTYIJ 15.48% 07/11 Sukuk 60.0 60.0 We believe that ELTYIJ’15s is attractive on a relative value basis vs. other
ELTYIJ 16% 07/12 Ijarah Sukuk 90.0 90.0 Indonesian real estate credits. ELTYIJ’15s trades around 14.3% yield for a
Total Onshore IDR Debt 3,178.9 4,545.9 gearing (Total debt / Total assets) of ~34% while recently restructured Pakuwon
ELTYIJ 8.625% CBs 03/15 1,144.7 1,144.7 Jati offers similar yield but has a higher gearing level at 40%.
Amortisation of issuance costs (5.9) (5.9)
Total Debt 4,317.7 5,684.7 More Stable Cash Flow From Toll Road, Hotels and Rental
Cash and cash equivalents 591.4 5,152.4 Operations Coming on Stream
Restricted cash 85.5 85.5 ELTY’s investments in toll roads and hotels may provide more stable cash flow
Net Debt 3,640.9 446.9
in the medium term. Recurring revenues increased from 15% of total revenues
in H1 09 to 29% in H1 10.
Equity market cap & MI 8,096.9 8,096.9 Favourable Housing Market Dynamics
Enterprise value 11,737.7 8,543.7 We believe that the dynamics for Indonesian real estate market is improving:
• Relaxation of foreign ownership rules;
Bank Debt / EBITDA 8.8x 8.8x • Jakarta apartments are cheap and rental yields high compared to regional
Bank & Fin. Inst. Debt / EBITDA 10.5x 16.1x peers;
Onshore IDR Debt / EBITDA 13.2x 18.8x • Mortgage industry in Indonesia is underdeveloped; and
Total debt / EBITDA 17.9x 23.6x • Housing demand may be greater than supply.
Net debt / EBITDA 15.1x 1.9x
EV / EBITDA 48.6x 35.4x But Further Indebtedness Likely for Expansion Plan
Source: SJS Markets estimates Despite the significant equity raising in July 2010, we believe that ELTY will
require additional funding for new project developments in the next couple of
(1) Pro Forma adjustments includes: IDR 3.2trn from rights
issue, IDR 917bn 'loan' from Societe Strasbourg and USD 50mn years, assuming that the company does not deviate from its current expansion
loan from Avenue Capital. plans. The additional funding will be applied to develop Lido Lake Resort, Bukit
Pro Forma adjustments do not include the use of proceeds from Jonggol and the Ciawi-Sukabumi toll road.
the rights issue.
BOND DETAILS
Issue Maturity Coupon Size Ratings Recommend.

(mo., yr) (%) (USD mn) (S&P/Moody’s) Price Yield Z-spread
ELTYIJ Mar 2015 8.625% 155 NR/NR 89 14.3% 1,341bp BUY
See the back of the document for important disclosures

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LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

1
CREDIT POSITIVES
Our Conservative NAV Estimate Adequately Covers Convertible

Bonds Outstanding
Based on our relatively conservative NAV calculations, we estimate that the

USD 155mn ELTYIJ 8.625% Convertible Notes 03/15 outstanding are more than
five times covered by the value of ELTY’s property portfolio and cash, after
deducting all other bank and onshore debt including the IDR bonds and sukuks.
Thus, in the worst case scenario, we think that the recovery on the bonds should be
at least par.
We calculated the NAV of ELTY’s property portfolio conservatively by valuing the

company’s land bank at acquisition cost or book value. For example, all of ELTY’s
174,400sqm land bank at Rasuna Epicentrum was valued at land cost similar to the
two parcels of land acquired with proceeds from ELTY’s rights issue in July 2010.
The Kanci-Pejagan toll road was valued at development costs of IDR 2.2trn as
reported in ELTY’s 2009 annual report.
Furthermore, our conservative NAV does not include rental income from investment
properties. Investment properties owned by ELTY include portions of Wisma Bakrie
1 and 2, Bakrie Tower, Lifestyle Centre, The Jungle Water Park, Orchard Walk, and
hotels.

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2
Exhibit 2: ELTY NAV Breakdown at Cost or Book Value
Size (000 Est. cost. psm Proj. Value Attributable ELTY Share
Division Type Description Location sqm) (IDRmn) (IDR bn) to ELTY (IDR bn)
PT Bakrie Swasakti Utama Mixed development Rasuna Epicentrum Kuningan, Central Jakarta 174.4 12.0 2,093.3 69.6% 1,457.4
PT Bakrie Pangripta Loka Residential Sentra Timur Residence Kota Baru, East Jakarta 16.0 5.5 88.0 100.0% 88.0
PT Graha Andrasentra Propertindo Residential Bogor Nirwana Residence Bogor, West Jawa 6,780.0 0.2 1,356.0 99.8% 1,353.0
Commercial The Jungle Water Park Bogor, West Jawa 23.0 0.2 4.6 99.8% 4.6
Commercial The Jungle Mall Bogor, West Jawa 10.6 0.2 2.1 99.8% 2.1
Commercial Orchard Walk Bogor, West Jawa 15.4 0.2 3.1 99.8% 3.1
Commercial Aston Bogor Hotel & Resort Bogor, West Jawa 141.3 32.3% 45.6
New Development ~60ha land acquisition Bogor, West Jawa 600.0 0.3 200.0 100.0% 200.0
PT Dutaperkasa Unggullestari Residential Ijen Nirwana Residence Malang 125.0 1.5 187.5 65.0% 121.9
PT Mutiara Permata Biru Residential Batam Nirwana Residence Batam 271.0 0.4 108.4 98.8% 107.1
PT Sanggraha Pelita Sentosa Residential Graha Taman Sukabumi Sukabumi 24.0 0.5 12.0 99.3% 11.9
PT Krakatau Lampung Tourism Dev. Hotel & Resort Krakatoa Nirwana Resort Lampung 998.0 0.2 152.5 90.0% 137.3
PT Libratindo Gemilang Hotel & Resort Balikpapan Nirwana S&R Balikpapan 32.0 2.0 62.8 100.0% 62.8
PT Berkah Puhu Lestari Hotel & Resort Ubud Nirwana Villas Ubud, Bali 42.0 0.4 15.5 100.0% 15.5
PT Samudra Asia Nasional Hotel & Resort Pullman Bali Legion Nirwana Bali 335.0 99.8% 334.2
PT Bali Nirwana Resort Hotel & Resort Nirwana Bali Resort Bali 170.0 4.0 673.4 52.6% 353.9
New Development Lido Lake Resort Sukabumi 10,370.0 350.0 100.0% 350.0
PT Bukit Jonggol Asri New Development Bukit Jonggol Jonggol 125,000.0 0.0 2,094.6 51.0% 1,068.3
New Development Karang Tengah Jonggol 5,000.0 0.2 1,000.0 51.0% 510.0
PT Sentul City Tbk Equity stake PT Sentul City Sentul 5.3% 178.5
PT Semesta Marga Raya Infrastructure Kanci-Pejagan toll road 2,200.0 100.0% 2,200.0
Subtotal 8,605.0
Add: Cash as of 30 June 2010 591.4
Less: Advances from customers (113.4)
Less: All bank and onshore debt excl. ELTY'15s (3,178.9)
Value available to CB holders 5,904.1
Value of CBs 1,144.7

Value of assets less other debt / Value of CBs 5.2x
Source: SJS Markets estimates

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3
Bukit Jonggol Could be the Future Administrative Capital for
Indonesia
A plan to move the administrative capital to Bukit Jonggol could be a huge positive
for land price in the area and is likely to benefit ELTY which has acquired significant
land bank in Jonggol at relatively low cost.
The current president of Indonesia, Susilo Bambang Yudhoyono, is considering

moving the administrative capital of Indonesia outside of Jakarta. One of the
locations being considered is Bukit Jonggol approximately 40km south-east of
Jakarta.
As part of ELTY rights issue in the middle of the year, the company acquired
13,000 hectares (130mn sqm) land bank in the Bukit Jonggol area. The company
plans to apply IDR 1trn (~USD 1.1bn) to acquire a 51% stake in PT Bukit Jonggol
Asri, which is the project holding company for the Bukit Jonggol land.
According to ELTY, the land acquisition costs is around USD 2psm and selling
price could be between USD 50-150psm.

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4
ELTY Successfully Raised IDR 3.2trn in Equity for Project
Developments
Exhibit 3: Pro Forma Shareholding We take comfort that at least a portion of ELTY’s future land acquisition costs have
Structure been funded by equity rather than new indebtedness.
Shareholder % Owned
ELTY completed a one-for-one rights issue in July 2010 in which the company
Avenue Capital 12%
raised IDR 3.2trn to fund project developments. Despite raising less than the IDR
Bakrie & Brothers 14%
5.4trn that was originally sought by the company, ELTY was able to obtain a further
Danatama Makmur 9% IDR 917bn of funds from Strasbourg Societe, an independent third party, as well as
Public 65% USD 50mn loan from Avenue Capital to make up for the short fall. The funds from
Source: Company and SJS Markets
Note: Shareholders pro forma for ELTY’s rights
Strasbourg Societe were applied to the Bukit Jonggol acquisition in which the
issue. investor has a Profit Sharing Agreement with ELTY. The loan from Avenue Capital
was applied to debt repayments for the Kanji-Pejagan toll road.
The rights issue removes the immediate need for ELTY to claim receivables due
from Limitless World International Services 6 Ltd (LWIS), a subsidiary of Dubai
World, which recently restructured its debt obligations. In June 2008, ELTY
divested 30% of the Rasuna Epicentrum project to the Dubai related entity, in which
the USD 110mn proceeds was earmarked to fund the development of Rasuna
Epicentrum. As of 30 June 2010, receivables due from LWIS amounted to USD
43.2mn.
Furthermore, ELTY may also be looking at other parties to replace LWIS. We think
that another more cash rich partner may have the capacity to inject new funds to
help finance part of the future development costs.
Exhibit 4: ELTY's Capital Raising and Use of Proceeds in Last Six Months
USD mn IDR bn
Date Description Use Proceeds Use Proceeds
Mar 2010 USD 155mn ELTYIJ 8.625% Conv. Notes 03/15 155.0 1,411
Working capital (10.0) (91)
Refinancing (25.0) (228)
General corporate (Rasuna Epicentrum and Bogor) (70.0) (637)
Equity swap - CS (50.0) (455)
Jun 2010 Rights Issue IV 352.1 3,194

Rasuna Epicentrum 2,085sqm land (2.8) (25)
Rasuna Epicentrum 9,357sqm enclave land (12.7) (115)
Development of Rasuna Epicentrum (27.6) (250)
Development and WC of Kota Baru JV with Perumnas (14.3) (130)
Development of Kanci-Pejagan toll (50.5) (458)
Ciawi Sukabumi toll (43.1) (391)
Acq of Lido Lake Resort (38.6) (350)
Acq ~60ha land near Bogor Nirwana (22.1) (200)
20% stake of Sentul City (16.5) (150)
Equity part. in Bkt Jonggol Asri 51% ownership (part pymt) (110.3) (1,000)
Other (13.8) (125)
Jun 2010 Strasbourg Societe Profit Share Agreement Funds(1) 98.6 917.0
Partial payment for 25% stake in Bukit Jonggol (98.6) (917.0)
H2 2010 USD 50mn Bridge Loan from Avenue Capital(2) 50.0 450.0
Repayment of loans relating to Kanji Pejagan toll road (50.0) (450.0)
TOTAL 655.7 5,971.5
Notes:
(1) We understand that Strasbourg has the option to convert the profit sharing agreement into a 25%
stake in Bukit Jonggol Asri.
(2) Per local press reports and our discussions with ELTY's management

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5
More Stable Cash Flow From Toll Road, Hotels and Rental Operations
Coming on Stream
ELTY’s investments in toll roads and hotels may provide more stable cash flow in
the medium term. In 2014, with the Ciawi-Sukabumi toll road completed, we
estimate that ELTY could generate ~IDR 800-900bn in revenues from toll roads.
The diversification of revenues to toll roads is already taking hold with the
completion of the Kanci-Pejagan toll road in January 2010. For the first six months
of the year, the toll road generated IDR 28.8bn in revenues or ~5% of total
revenues for the company.
Income from ELTY’s hotel business already accountS for 15% of H1 10 revenues,
up from 6% in H1 09. We expect the hotels business to remain a significant part of
the company’s revenues going forward.
Exhibit 5: LHS – ELTY's Recurring Cash Flows as a Percentage of Total

Revenues; RHS – Total Revenues (IDR bn)
35% 800
Recurring revenues increased
from 15% of total in H1 09 to
700
29% in H1 10. 30%
600
25% 9.0%
500
20%
(IDR bn)
400
15%
2.9% 300
15.0%
10% 9.0%
200
12.1%
5% 100
6.0% 5.0%
0% - - 0
H1 09
H2 09
H1 10
Toll road Hotel & Resort

Edutainment Water Park Total revenue
Source: Company presentations and reports

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6
ELTYIJ’15s Appear Attractive On Relative Value
We believe that ELTYIJ’15s is attractive on a relative value basis vs. other

Indonesian real estate credits.
ELTYIJ’15s trade around 14.3% yield for a gearing of ~34% while recently
restructured Pakuwon Jati has similar yield but higher gearing level at 40%.
Exhibit 6: Indonesia and Philippines Real Estate Credits Yield (%) vs. Gearing
15%
PWON'15
ELTYIJ'15
14%
13%
12%
11%
YTW
10%
9%
8%
VLLPM'15
7% LPKRIJ'15
6%
15% 20% 25% 30% 35% 40% 45%
Total Debt/Total Assets
Source: SJS Markets

Note: ELTY’s gearing (Total debt / Total assets) is pro forma for the proceeds from the company’s rights
issue which was completed in July 2010.

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7
Relaxation of Foreign Ownership of Indonesian Property Could be a
Boon for ELTY’s Luxury Apartments in Rasuna Epicentrum…
We believe that forthcoming relaxation of foreign ownership rules would be positive

for ELTY and particularly demand for the company’s higher end condominium
developments in Rasuna Epicentrum.
In June 2010, the local media quoted a spokesperson from the Ministry of Public
Housing saying that the ministry was in the process of changing the regulations
relating to foreign ownership of Indonesian properties.
As we understand, current regulations prohibit foreigners to own properties. Instead,

foreigners have to periodically renew their right to use a property. Initially,
foreigners are allowed to hold a property for 25 years, and can seek another 25
year lease extension and a final 20-year extension.
According to recent media reports, new regulations to be put in place are still
unlikely to allow full foreign ownership, but instead could simplify the lease renewal
process. Thus, instead of renewing the lease for right to use every 25 years,
foreigners could be granted a 70 year lease on the onset in acquiring a property.
We understand that the regulations may only apply to high-end condominiums in
Jakarta.
Based on various estimates by the Department of Manpower and Transmigration,

there could be around 57,000 expatriates living in Jakarta.
… And Indonesia Property is a Relatively Attractive Investment

Compared to Regional Peers
Compared to regional peers, we believe that Indonesian real estate could be an

attractive investment that could provide both capital gains and income, which
should bode well for property demand.
We believe that real estate in Indonesia has significant room for price appreciation
in the medium term. Per data from www.globalpropertyguide.com, the price per
square meter for apartments in Jakarta is one of the cheapest among regional
peers.

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8
Exhibit 7: Price Per Square Meter in USD of 120sqm Apartment located in
Capital City
18,000
Jakarta apartments have the 16,422
lowest price per square meter 16,000
…
14,000 12,884
12,000 11,324
10,265
10,000
8,000
6,000 5,449 5,251
4,000 3,072
2,668
2,033
2,000 1,424 1,381
Cambodia
Hong Kong
Japan
India
China
Thailand
Malaysia
Indonesia
Philippines
Singapore
Source: www.globalpropertyguide.com Taiwan
Secondly, rental yields in Jakarta are the highest in the region which could provide
stable income for investors (Source: www.globalpropertyguide.com).
Exhibit 8: Gross Rental Yield for 120sqm Apartment in Capital City

14%
…and highest gross rental 12.3%

yields among capital cities in 12%
the region.
10%
9.0% 8.8%
8.0%
8%
5.7%
6%
4.3%
3.8% 3.6% 3.6%
4%
3.1%
2.7%
2%
0%
Cambodia
Indonesia
Malaysia
Thailand
Japan
India
China
Hong Kong
Philippines
Singapore
Taiwan
Source: www.globalpropertyguide.com

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9
Good Macro and Demographic Outlook in Indonesia to Drive Real
Estate Sector
We think that the long term fundamentals for real estate companies in Indonesia
are promising given strong forecasted GDP growth, population growth and supply
demand imbalance.
Firstly, the Indonesia economy has been resilient and was one of the fastest
growing economies in the ASEAN region in 2009 despite the global financial crisis.
While its neighbours such as Malaysia, Singapore and Thailand suffered negative
economic growth, Indonesia’s economy grew at 4.6% in 2009. Per Bloomberg
consensus estimates, Indonesia’s GDP is expected to grow at 6% and 6.3% in
2010 and 2011, respectively. The GDP growth rate is expected to be the third
highest among the G-20 nations after China and India.
Exhibit 9: Indonesia GDP Growth (% Change YoY)
7.0%
Indonesia expected to be
third fastest growing
economy among G-20 nations 6.5% 6.5%
6.3% 6.3%
for 2010 and 2011.
6.0%
6.0% 6.0%
5.7%
5.5% 5.5%
Forecast
5.0% 5.0%
4.8%
4.5% 4.6%
4.0%
2010E
2011E
2012E
2003
2004
2005
2006
2007
2008
2009
Source: Bloomberg
Secondly, we think that a sovereign rating upgrade to investment grade could be

beneficial for foreign investment and the real estate sector as it will aid in the
development of the mortgage industry and products backed by home loans.
In our opinion, Indonesia’s credit rating may have the potential to be upgraded to
investment grade within the next 18 to 24 months. Recently, Indonesia’s Finance
Minister said that he believed that an investment grade rating for the country could
be achieved by early 2011, depending on the government’s success in increasing
tax revenues.
Indonesia’s sovereign credit rating was upgraded to Ba2 (positive), BB (positive)

and BB+ (stable) by Moody’s, S&P and Fitch within the last eight months.
th
Finally, Indonesia’s competitiveness ranking was raised ten notches to 44 per a
World Economic Forum report. This should also bode well for foreign investment
and the real estate sector as a whole.

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10
Jakarta Expected to be Largest Metropolitan Area in the World by
2030
Per data from Demographia World, the population in the Greater Jakarta region
(DKI Jakarta, Bogor, Depok, Tangerang, and Bekasi, or Jabodetabek) will increase
to 32.7mn and 37mn by 2025 and 2030, respectively. As a result, the Greater
Jakarta region is expected to have the highest population globally by 2030 ahead of
Tokyo.
Thus, we believe that there is genuine and stable demand for real estate in the
region which would be particularly beneficial for ELTY’s newly acquired Bukit
Jonggol, Sentul City and Lido Lake developments in the outskirts of Jakarta.
Exhibit 10: Greater Jakarta (Jabodetabek) Population in Millions
40
37.0
35 32.7
30
26.6
25 23.3
20
15
11.6
10 8.0
5.7
5
0
2010E
2025E
2030E
1961
1971
1980
2000
Source: Historical per Indonesia government census, 2010 data from Wikipedia, and forecast per
Demographia World
Favourable Supply Demand Dynamics
We think that there could be more demand for homes relative to supply in the
Jabodetabek area. This supply demand imbalance could be beneficial for the
longer term prospects of ELTY’s Bogor, Lake Lido, and Bukit Jonggol
developments.
An ELTY company presentation to investors published in August 2010 quoted

Investor Daily which highlighted that there could be an annual shortage of 600,000
homes in Indonesia as supply is 200,000 homes while demand stands at 800,000
homes per annum.
We think that this assumption is justified. Per data from the US Census Bureau,
there could be around 40mn Indonesians between 25 to 34 years old. This is a
good indicator of potential housing demand, in our opinion. Assuming 2 persons
per household and this age group to purchase a house within a ten year period, the
potential number of new house formations could be 2mn p.a. Thus, assuming some
of this population will continue to live with their parents and some do not marry, the
assumption of 800,000 units of annual demand is not unreasonable.

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11
On the supply, data from The Association of Housing in Indonesia (APERSI)
suggests that new home supply per annum could be around 200,000-300,000 units,
which is insufficient to meet demand of ~800,000 units.
Increasing GDP Per Capita, Underdeveloped Mortgage Industry and

Low Interest Rate Environment
We think that increasing GDP Per Capita, an underdeveloped mortgage industry

and low interest rate environment could be very well suited for significant growth in
the Indonesian real estate sector which would be beneficial for ELTY’s new
township developments to the south of Jakarta.
The potential in the market has not gone unnoticed by ELTY’s competitors. For
example, Lippo Karawaci recently announced plans to invest into residential
townships in the eastern parts of the country.
Firstly, the mortgage loans to GDP ratio suggest that Indonesia is underleveraged
and the mortgage loan industry has substantial room for growth. Indonesia’s
mortgage loans as a percentage of GDP was 2.2% according to data from CEIC,
which is the lowest in the region. In comparison, Thailand, China, and Malaysia had
mortgage to GDP ratios of 10.5%, 14%, and 26.2%, respectively.
Exhibit 11: Mortgage Loans as % of GDP
100%
89.7%
80% 73.3%
69.8%
61.3%
60%
46.2%
41.8%
40% 35.0%
26.2% 26.1%
21.1%
20% 14.0%
10.5%
5.2%
3.4% 2.2%
0%
US
UK
HK
Malaysia
Japan
China
Thailand
Indonesia
Philippines
Singapore
Korea
New Zealand
Australia
Taiwan
India
Source: CEIC

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12
Secondly, the low mortgage to GDP ratio is coupled with an increasing GDP per
capita and relative low homeownership rates. As shown in Exhibit 12, Indonesia
had the highest annual growth rate in GDP per capita in 2007 and 2008 when
compared to its Asian neighbours.
Exhibit 12: Annual % Growth Rate in GDP per Capita on Constant Local
Currency
10
-
(YoY % Chg)
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
(5)
(10)
(15)
Indonesia Malaysia Thailand Singapore Philippines
Source: Bloomberg
Exhibit 13: GDP Per Capita as of 31 December 2008 (Constant Prices in USD)
30,000
Despite strong economic 27,991
growth in recent years,
Indonesia’s GDP per capita is 25,000
still relatively low compared
to regional peers.
20,000
15,000
10,000
5,151
5,000
2,640
1,965
1,225 1,087 647
0
Malaysia
Thailand
China
Indonesia
Philippines
Vietnam
Singapore
Source: Bloomberg

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13
Lastly, Bank Indonesia has indicated that it intends to maintain a low interest rate
environment for the rest of the year. During the latest central bank meeting on 5
October, policymakers kept the reference rate at 6.5%.
Exhibit 14: Bank Indonesia Reference Interest Rate
14
13
12
(%) 11
10
Forecast
9
Q4 10E
Q2 11E
Q4 11E
Q4 05
Q2 06
Q4 06
Q2 07
Q4 07
Q2 08
Q4 08
Q2 09
Q4 09
Q2 10
Source: Bloomberg consensus forecasts

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14
CREDIT NEGATIVES
Further Indebtedness Likely…
Despite raising nearly IDR 6trn (USD 656mn) in equity and debt over the last six
months, we believe that ELTY could require additional funding of ~IDR 2.7trn (USD
294mn) for new project developments in the next couple of years, assuming that
the company does not deviate from its current expansion plans.
The need for additional funding was also mentioned by ELTY’s President Director
recently. According to local press reports, the President Director said that the
company’s PT Bakrie Toll subsidiary may be seeking IDR 1 to 1.5trn in new bonds
to help finance construction of the Ciawi-Sukabumi toll road and refinance existing
indebtedness.
Exhibit 15: Summary of Major Funding Requirements in Next Two Years (SJS
Markets Estimates, Excludes Project Finance Loans)
Amount
Project Type IDR bn USD mn
Lake Lido Township development 75 8.2
Bukit Jonggol Asri Township development 179 19.6
Ciawi-Sukabumi Toll road 1,080 118.7
Repayment to Strasbourg Bukit Jonggol Asri 917 100.8
Acquisition of ~15% PT Sentul City Tbk Equity stake 428 47.0
Total 2,678 294.3
Notes:
• The above analysis excludes project finance loans and includes only the 'equity' portion that needs to
be funded at the holding company level.
• Payment to Strasbourg relates to the IDR 917bn provided by the Strasbourg Societe as part of the
Profit Sharing Agreement
Our analysis above does not include the project finance debt that will probably have
to be undertaken at the project company level. For example, we estimate that the
total development costs for the Ciawi-Sukabumi toll road could be IDR 5.4trn in
total, in which we estimate the ELTY will have to raise ~IDR 1trn in equity or debt at
the PT Bakrie Toll subsidiary level.
Hence, in the short term, we expect ELTY’s leverage to increase as contracted

sales and toll revenues are likely to come in only at the later stages of project
development.

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15
… to Develop Lido Lake Resort and Bukit Jonggol Projects…
We believe that ELTY may require further financing to fund new township
developments in Lido Lake Resort and Bukit Jonggol.
Exhibit 16: Major Property Development Projects for Next Few Years
Bukit Karang
(1) (1) (2)
Project Lido Lake Jonggol Tengah Total
Land costs (IDR bn) 350 2,095 1,000
Size (mn sqm) 10.4 125.0 5.0
Land cost per sqm (IDR) 33,751 16,757 200,000
Assumptions
ASP (IDR psm) 450,000 450,000 1,800,000
Gross margin(3) 45.0% 45.0% 45.0%
EBITDA margin(3) 20.0% 20.0% 20.0%
Project development period 5 years 15 years 15 years
Estimated Profit & Loss (IDR bn)

Total Revenues 4,667 56,250 9,000 69,917
Gross profit 2,100 25,313 4,050 31,462
EBITDA 933 11,250 1,800 13,983
Construction, SG&A, marketing costs (3,733) (45,000) (7,200) (55,933)
Notes:
(1) ASP for Lido Lake Resort and Bukit Jonggol is assumed to be USD 50psm, the low end of guidance
per ELTY management estimates.
(2) ASP for Karang Tengah was assumed to be USD 200psm, the same as Sentul given the proximity to
Sentul and higher land acquisition costs.
(3) Gross and EBITDA assumptions in line with FY08 and 09 margins for the company.
Based on a back of the envelope calculation, we estimate that ELTY may require
~IDR 2.3trn in project finance loans and ~IDR 250bn in equity to fund the
development of the Lake Lido Resort and Bukit Jonggol Asri projects, assuming
that ELTY has to finance a minimum of 10% of the project via equity. Our estimate
is based on our estimated construction, SG&A, and marketing costs divided equally
throughout the estimated life of the projects.
During the later stages of project development, we expect contracted sales to pick
up and fund part of the construction costs and repay project finance loans. The
equity portion of the projects will be funded by ELTY either through internal sources
or loans at the PT Bakrieland Development Tbk level.
Exhibit 17: Estimated Development Costs For 2011/12 (IDR bn)

Project Equity Debt Total
Lake Lido 75 672 747
Bukit Jonggol and Karang Tengah 179 1,607 1,785
Total 253 2,279 2,532
Note: Bukit Jonggol Asri funding requirements are based on a 51% stake in the project.
On top of these major developments, we think that ELTY will also have to fund
development costs for the following projects outlined in Exhibit 18. For Rasuna
Epicentrum, ELTY has already allocated IDR 250bn from its rights issue proceeds
to fund development.
Exhibit 18: Other Property Development Projects for Next Few Years
Land Bank
Development (000 sqm) Comments
Rasuna Epicentrum 174 Includes The Grove and Wave Condominium projects.
Bogor Nirwana Residence 6,780 Landed residential
~60ha land, Bogor 600 New land acquisition per rights issue
Ijen Nirwana Residence 125 Residential development in Malang, East Jawa
Batam Nirwana Residence 271 Residential development in Batam Island, off Singapore
Graha Taman Sukabumi 24 Landed residential

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To help fund some of these projects, ELTY may be looking for JV partners. As
reported in Kontan at the end of September 2010, the company could be in
negotiations with Saudi and or Qatari investors who are interested in investing in
Rasuna Epicentrum, Bukit Jonggol Asri and Bogor projects.
Hence on a more positive note, the amount of new indebtedness could be lowered,
but we still expect the company to lever up at the project company level.
…As Well As ELTY’s Toll Road Projects
Toll road construction requires significant amounts of capital. For example, the
35km toll road between Kanci and Pejagan costs ELTY IDR 2.2trn in total
development costs or IDR 62.9bn per km by our calculations. To develop the Ciawi-
Sukabumi toll road alone (the next infrastructure project in line), we estimate that
the development costs could be up to IDR 5.4trn which could potentially be
completely debt funded.
For the already completed Kanci-Pejagan toll road, we estimate that ELTY may
have taken up ~IDR 1.8trn in project finance or approximately 80% of total
development costs. Assuming a similar capital structure for the construction of the
Ciawi-Sukabumi toll road, we estimate that ELTY will have to source ~IDR 1trn in
equity funding from internal sources and ~IDR 4.3trn in project finance debt.
At the end of September 2010, the local press reported that ELTY’s Bakrie Toll
Road subsidiary may be looking to raise IDR 1 to 1.5trn (USD 111 to 167mn) in
new bonds to refinance existing indebtedness and to fund new toll road
constructions. Furthermore, the construction of the Ciawi-Sukabumi toll road is
expected to draw IDR 391bn of the recent rights issue proceeds.
In our opinion, this potential bond deal and proceeds from rights issue could cover
the ‘equity’ portion of Ciawi-Sukabumi toll road construction, which will be funded at
the PT Bakrie Toll Road level. However, we think that a further IDR 4.3trn of project
finance debt could be consolidated into ELTY’s balance sheet before the toll road
becomes operational.
Exhibit 19: Major Toll Road Projects for Next Few Years
Ciawi- Pejagan- Batang- Pasuruan-
Toll Road Kanci-Pajagan Sukabumi Pemalang Semarang Probolinggo
Status Completed WIP Assessment Assessment Assessment
Length (km) 35 54 58 75 45
Construction time (mths) 18 36 23 30 18
Development cost per km (IDR bn) 63 100 60 60 60
Total development costs (IDR bn) 2,200 5,400 3,480 4,500 2,700
Toll per km (IDR) 614 400.0 600.0 600.0 600.0

Daily traffic (no of vehicles per day) 8,000-13,000 100,000 15,000 20,000 15,000
Revenues (IDR bn) 78.5 788.4 190.5 328.5 147.8
Payback period excl maintenance (yrs) 28.0 6.8 18.3 13.7 18.3
Capital Structure (est)

Debt (80%) 1,760 4,320 2,784 3,600 2,160
Equity (20%) 440 1,080 696 900 540
Notes:
Ciawi-Sukabumi's development costs are higher because the area is hilly. Management estimated
total development costs to be IDR 5.2trn
Kanci-Pajagan revenues are estimated based on 10,000 vehicles per day.
With the exception of Kanci-Pajagan, construction time, development costs, daily traffic, and toll per
km are SJS estimates

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Limited Track Record of Positive Free Cash Flow
ELTY has limited track record in generating positive free cash flow. ELTY has not
generated positive Free Cash Flow or Cash flow from Operations for the last five
years. After excluding land acquisitions (included in ELTY’s definition of CFO), the
cash flow from operations was negative for the last three years.
In the near term, we do not expect ELTY to generate positive FCF as we expect
significant development costs for toll roads and township developments in
Sukabumi and Jonggol.
Exhibit 20: ELTY's EBITDA, CFO and FCF 2005 to 2009 (in IDR bn)
500
246 208
188
91 80 46
52
0
2005 2006 2007 2008 2009
(159) (214)
(255) (288)
(500) (355) (366)
(470)
(552)
(1,000) (887)
(1,057)
(1,132)
(1,500)
(2,000) (1,860)
(2,035)
(2,500)
EBITDA CFO excl land acquisitions CFO FCF
Source: Company reports
Exhibit 21: ELTY's EBITDA, CFO and FCF Q1 08 to Q2 10 (in IDR bn)
500
0
Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210
(500)
(1,000)
(1,500)
(2,000)
EBITDA CFO FCF
Source: Company reports

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Avenue Capital May Have Extracted Most of its Initial Investment in
ELTY
ELTY could lose support from its majority shareholder Avenue Capital. We
calculate that Avenue Capital may already have extracted most of the value from its
investment in ELTY. Furthermore, Avenue did not participate in the company’s
most recent rights issue which suggests that the latter may not believe that ELTY’s
equity could generate the required return going forward.
According to its website, Avenue Capital is a fund which invests in distressed

companies. The fund has been invested in ELTY since November 2005, following
the company’s second rights issue. Following the most recent rights issue we
estimate that Avenue Capital holds 4.9bn ELTY shares or ~12% of the company’s
total share capital.
Exhibit 22: Avenue Capital’s Investments and Divestments in ELTY Equity

Est. share (+/-) shares Cash in Cash out
Date price (IDR) (bn) IDR bn
01 Dec 05 125 0.7 (84.0)
30 Apr 07 200 1.7 (336.0)
01 May 07 250 2.5 (613.4)
Q4 07 600 (0.9) 569.0
Q1 08 600 (0.3) 206.7
Q2 08 407 (0.4) 165.7
15 Oct 08 100 3.1 (305.2)
Q4 09 278 (1.3) 356.2
Total 4.9 (1,338.6) 1,297.6
Source: SJS Markets estimates and Company reports
Assuming a current share price of IDR 180 per share, we estimate that Avenue
Exhibit 23: Sensitivity could achieve an IRR of ~33% for its investment over the past five years if it sold its
Analysis of IRR on Avenue’s remaining stake today. Even at a lower share price of IDR 100, we believe that
Investment vs. Share Price Avenue could still achieve an IRR of ~22%. Hence, we think that the downside for
Share
Avenue’s investment is limited and we should not expect further support from the
price
hedge fund should ELTY falter.
(IDR) IRR (%)
32.9%
50 11.7% Despite Avenue’s non-participation in ELTY’s most recent rights issue, the local
100 21.5% news reported that the fund may have extended a USD 50mn loan to the company
180 32.9% which was applied to repay certain indebtedness relating to the construction of the
200 35.3% Kanci-Pejagan toll road.
250 40.7%

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Exhibit 24: ELTY Shareholding Structure
100%
Avenue Capital decreased its 90%

shareholding from 31% to
12% pro forma for the rights 80%
issue since the beginning of
2009. 70%
60%
50%
40%
30%
20%
30.8% 30.8%
30.8%
24.4% 24.4% 24.3%
10%
12.0%
0%
Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 PF Rights
Avenue Capital PT Bakrie & Brothers Tbk Public / Other

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COMPARABLE PUBLICLY TRADED COMPANIES – INDONESIAN REAL ESTATE
Company Bakrieland Lippo Karawaci Pakuwon Sentul City Ciputra

Equity Ticker ELTY IJ LPKR IJ PWON IJ BKSL IJ CTRA IJ
LTM to 30 Jun 10 30 Sep 10 30 Jun 10 30 Jun 10 30 Jun 10
Currency IDR bn IDR bn IDR bn IDR bn IDR bn
MDY/S&P NR/NR B1/B Caa1/NR NR/NR NR/NR
Financial Data
Net Sales 1,227.7 2,831.6 917.2 295.1 1,400.5
Gross Profit 563.6 1,290.2 347.2 143.4 627.5
EBITDA 241.3 698.1 329.8 86.8 311.7
Interest Expenses (67.3) (43.5) (107.6) (12.3) (5.2)
Gross Margin 45.9% 45.6% 37.9% 48.6% 44.8%
EBITDA Margin 19.7% 24.7% 36.0% 29.4% 22.3%
Balance Sheet
Total Assets 12,010.1 13,073.6 3,755.9 4,417.7 8,914.3
Total Debt 4,317.7 3,453.9 1,518.0 214.1 191.1
Restricted cash 85.5 81.9 26.7 0.2 -
Cash & Equivalents 591.4 1,010.1 202.9 20.7 2,252.9
Net Debt 3,640.9 2,362.0 1,288.5 193.1 (2,061.7)
SHE 5,580.8 5,711.3 1,411.5 3,874.2 7,130.5
Leverage and Coverage Ratios
Total Debt/EBITDA 17.9x 4.9x 4.6x 2.5x 0.6x
Net Debt/EBITDA 15.1x 3.4x 3.9x 2.2x nm
EBITDA/Cash Interest 3.6x 16.0x 3.1x 7.0x 60.3x
Total Debt/Total assets 36.0% 26.4% 40.4% 4.8% 2.1%
Total Debt/SHE 77.4% 60.5% 107.6% 5.5% 2.7%
Net Debt/SHE 65.2% 41.4% 91.3% 5.0% (28.9%)
Total Debt/MVE 53.9% 28.3% 15.7% 5.9% 2.1%
Pro Forma Metrics
Total Debt/EBITDA 20.6x 4.9x 4.6x 2.5x 0.6x
Net Debt / EBITDA 8.9x 3.4x 3.9x 2.2x nm
Total Debt/Total assets 34.3% 26.4% 40.4% 4.8% 2.1%
Valuation
MARKET VALUATION as of 12 Oct 10
Equity Value (bn) 8,017.1 12,216.0 9,647.8 3,611.9 8,911.8
EV 11,657.9 14,578.0 10,936.2 3,805.0 6,850.1
EV/EBITDA (x) 48.3x 20.9x 33.2x 43.8x 22.0x
Source: Company reports and SJS Markets

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FINANCIAL FORECAST SUMMARY
Year Ending 31 Dec 2005 2006 2007 2008 2009 2010F

(in IDR bn)
Income Statement
Revenues 319.8 393.2 782.1 1,053.8 1,059.0 1,300.0
YoY growth 23.0% 98.9% 34.7% 0.5% 22.8%
Gross profit 135.9 167.2 321.1 510.3 498.1 585.0
YoY growth 23.0% 92.1% 58.9% (2.4%) 17.4%
Gross margin 42.5% 42.5% 41.1% 48.4% 47.0% 45.0%
EBITDA 52.0 79.7 187.6 246.0 208.2 260.0
YoY growth 53.3% 135.5% 31.1% (15.4%) 24.9%
EBITDA margin 16.3% 20.3% 24.0% 23.3% 19.7% 20.0%
Balance Sheet
Total assets 2,542.6 2,395.7 5,708.0 8,335.0 11,592.6
Total liabilities 1,257.5 1,036.4 1,508.3 3,133.7 5,794.2
SHE 1,246.4 1,318.8 4,132.8 4,507.7 4,642.5 7,820.7
MI 38.7 40.5 66.9 693.7 1,156.0 1,000.0
Total debt 153.0 155.9 379.1 1,155.0 3,088.7 5,350.8
Restricted cash 0.0 3.6 96.7 236.3 175.6 85.5
Cash 238.8 32.6 1,042.9 740.3 760.4 2,961.4
Net debt (85.8) 119.6 (760.5) 178.3 2,152.7 2,304.0
Cash Flow Statement
CFO (159.0) (214.4) (887.5) (1,057.4) (365.7) (671.8)
Net capex (95.8) (73.4) (200.0) (297.5) (1,574.3) (2,000.0)
Other - - (947.7) 222.7 80.2 -
FCF (254.7) (287.8) (2,035.1) (1,132.2) (1,859.8) (2,671.8)
Leverage Metrics
LTM Revenues 319.8 393.2 782.1 1,053.8 1,059.0 1,300.0
LTM gross profit 135.9 167.2 321.1 510.3 498.1 585.0
LTM EBITDA 52.0 79.7 187.6 246.0 208.2 260.0
LTM Interest expense (11.8) (10.7) (7.7) (53.7) (37.1) (431.8)
EBITDA / Interest expense 4.4x 7.5x 24.4x 4.6x 5.6x 0.6x
Total Debt/EBITDA 2.9x 2.0x 2.0x 4.7x 14.8x 20.6x
Net Debt / EBITDA nm 1.5x nm 0.7x 10.3x 8.9x
Total Debt / Total assets 6.0% 6.5% 6.6% 13.9% 26.6%
Total Debt / Equity 11.9% 11.5% 9.0% 22.2% 53.3% 60.7%
Valuation
Share outs (bn) 5.6 5.6 19.6 19.9 19.9 39.9
Price (IDR) (end of period) 136.0 161.0 620.0 72.0 193.0 150.0
Equity Value (IDR bn) 800.3 942.1 12,232.5 2,127.6 4,999.9 6,988.0
Enterprise Value 714.5 1,061.7 11,471.9 2,305.9 7,152.6 9,292.0
EV/EBITDA (x) 13.7x 13.3x 61.2x 9.4x 34.4x 35.7x

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Exhibit 25: LHS – Quarterly EBITDA (IDR bn); RHS Exhibit 26: LHS – Quarterly Total Debt / EBITDA; RHS
EBITDA Margin Total Debt / Total Assets
100 35% 25x 40%
92.3 36.1%
36.0%
90 32.1%
20.5x 35%
30%
80 20x
69.9 17.9x 30%
25% 26.6%
70 22.0%
23.3%
21.0%
14.8x 25%
60 20.9% 15x
20%
48.2
50 45.3 20%
15% 14.3% 15.0%

40 10x 14.7%
33.9 33.8 15%
30 10%
8.4% 5.4x 5.5x 10%
4.8x
20 5x
5%
5%
10
0 0% 0x 0%
Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10
EBITDA EBITDA Margin Total debt / EBITDA Total debt / Total assets
Source: Company Source: Company
Exhibit 27: ELTY Debt Maturity Profile as of 30 June 2010 (in IDR bn)
1,600
1,400
1,200
1,000
800
600
400
200
0
Q3 10
Q4 10
Q1 11
Q2 11
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
Q4 14
Q1 15
Q2 15
Q3 15
Q4 15
Q1 16
Q2 16
Q3 16
Q4 16
Q1 17
Q2 17
Bank loans and financial institution Capital lease obligations ELTYIJ 11.9% 03/11 ELTYIJ 12.85% 03/13
ELTYIJ 15.48% 07/11 Ijarah Sukuk ELTYIJ 16% 07/12 Ijarah Sukuk ELTYIJ 8.625% Conv. Notes 03/15
Source: Company reports and SJS Markets estimates

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Exhibit 28: ELTYIJ 8.625% Conv. Notes 03/15 Price (USD)
105
100
95
90
85
80
75
Mar 10 Apr 10 May 10 Jun 10 Jul 10 Aug 10 Sep 10
Source: Bloomberg and SJS Markets
Exhibit 29: ELTY IJ Share Price (IDR)
725
625
525
425
325
225
125
25
2005 2006 2007 2008 2009 2010
Source: Bloomberg and SJS Markets

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COMPANY DESCRIPTION
PT Bakrieland Development Tbk (ELTY) is an Indonesian property developer with

approximately 84.8mn sqm of land bank located mainly in Jabodetabek. Its current
developments include Rasuna Epicentrum in Central Jakarta and Bogor Nirwana
Residence, a 1,000ha landed residential project.
Following the company’s fourth rights issue which was completed in July 2010,
ELTY acquired significant land bank in Sukabumi and Jonggol earmarked for
township developments.
ELTY is also involved in the construction and operation of hotels and resorts. Some
of ELTY key resort developments include Aston Hotel Bogor, Pullman Bali Legian
Nirwana and Nirwana Bali Resort.
In addition to residential and commercial property developments, ELTY is also

involved in toll road construction and operation in Indonesia. The company
completed construction of a 35km toll road between Kanji and Pejagan and is in the
process of building a 54km toll road between Ciawi and Sukabumi.
Lastly, ELTY also invested in a water utility company. Through PT Bakrie

Infrastructure, the company purchased 75% shares in PT Alberta Utilities, which
owns 5% shares of PT Aetra Air Jakarta (previously PT Thames PAM Jaya), a
clean water provider company in Eastern Jakarta.
Bakrieland, was previously known as PT Elang Realty and was listed on the
Indonesian Stock Exchange on 30 October 1995.
Exhibit 30: Shareholders Following Fourth Rights Issue
Avenue Capital
12% PT Bakrie & Brothers
Tbk
14%
Public
65% Danatama Makmur
9%
Source: Company and SJS Markets estimates
Board of Commissioners and Management Team
Among the six members on the Board of Commissioners, Avenue Capital, ELTY’s
12% shareholder has two representatives.
Position Name Other Positions / Comment

President Bambang Irawan Hendrari Commissioner of Bakrieland since 2002
Commissioner
Commissioner Edgardo A. Bautista Head of Infrastructure Avenue Asia
Commissioner Mark Robert Harris Managing Director Asset Management
Group, Avenue Capital
ELTY’s President Director is Hiramsyah Sambudhy Thaib, who was the ex-CEO of
PT Bakrie Capital Indonesia between 2005 and 2007.

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Land Bank
We estimate that ELTY could have a land bank of ~84.8mn sqm in site area after a
series of major land acquisitions with the proceeds from the company’s rights issue
in July 2010. Land bank acquired recently includes:
125mn sqm and 5mn sqm parcels of land in Bukit Jonggol and Karang
Tengah, respectively. ELTY’s attributable interest in PT Bukit Jonggol Asri,
the company which holds the land parcels, is 51%;
10.4mn sqm of land relating to the Lake Lido Resort, Sukabumi which already
has a golf course and resort hotel;
6mn sqm addition to land bank in Bogor; and
Additional land parcels in the Rasuna Epicentrum development in Central
Jakarta.
Exhibit 31: ELTY's Land Bank in Site Area as of July 2010 (estimate)
Malang, 0.1%
Batam, 0.3%
Bali, 0.2%
Jakarta, 0.2% Balikpapan, 0.0%
Following recent land Bogor, 8.7%
acquisitions, we estimate that Sukabumi, 12.3%
ELTY has an attributable land
bank of 84.8mn sqm mostly
located in Jabodetabek.
Jonggol, 78.2%
Source: Company and SJS Markets estimates.

Note:
Land bank is calculated pro forma of new land bank acquired from the proceeds of the recent rights
issue.
Land bank is calculated based on ELTY's attributable share of development site area. For example,
Jonggol's site area was calculated based on a 51% interest.

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Exhibit 32: Location of ELTY's Land Bank in Jabodetabek
Sentra Timur Residence

16,000 sqm
Rasuna Epicentrum,
174,400 sqm
Jonggol
130mn sqm
Bogor inc. Water

Park, 7.4mn sqm
Lake Lido
Resort, 10.4mn
sqm
Source: Google maps, Company reports
Key Development Projects
Rasuna Epicentrum
The Rasuna Epicentrum is located in Central Jakarta adjacent to the Golden
Triangle or central business district. The project is 69.6% owned by ELTY and
30.4% owned by Limitless of Dubai World.
The development consists of commercial and residential towers including:

17 blocks of 30-storey condominiums (4,294 units) fully developed and 100%
sold, part of Taman Rasuna Apartment. Another 3 towers will be built as part
of this development;
Bakrie Tower: 50-storey office building completed in December 2009. May
serve as the head office for Bakrieland, Bakrie Telecom and other Bakrie
companies;
The Grove Condominium & Suites: Mid to up market segment residential
development consisting of 438 apartment units in 2 towers. Target completion
in Q2 11;
Epicentrum Walk: Retail complex of ~24,000sqm which includes EpiWalk,
Lifestyle Centre (3-storey retail, 4 upper floors office) and Epicentrum XXI
cinema. Operational since March 2010;
The Wave Condominium: 2,797 mid-market apartments in 10 towers.
Expected completion in Q1 12; and
Convergence Indonesia: 26-storey office building. Expected completion in
June 2012.

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Exhibit 33: Bakrie Tower Exhibit 35: Location of Rasuna Epicentrum Development in Central Jakarta
Rasuna Epicentrum,
ELTY
Source: Company
Exhibit 34: Lifestyle Centre

Sudirman Central
Bus. District,
Danayasa Arthatama Mega Kuningan,
Abadi Guna Papan
and SOE
Source: Company
Source: Company
Exhibit 36: Rasuna Epicentrum Plan
Source: Company

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East Jakarta CBD Project
East Jakarta CBD Project is a joint venture project with Perumnas in East Jakarta.
The development will consist of residential (Sentra Timur Residence), commercial
and office buildings. The project also entails the development of the Pulogebang
bus terminal which is expected to be completed by 2012.
Exhibit 37: East Jakarta CBD Project
Source: Company
Bogor Nirwana Residence

Bogor Nirwana Residence is a landed residential development project to the south
of Jakarta (see Exhibit 32 for location map). The remaining land bank is
~7.4mn sqm. Since its inception, more than 2,300 units have been sold from 12
clusters. The development also consists of other facilities such as The Jungle
(waterpark), The Jungle Mall (retail space), Orchard Walk (retail) and Aston Hotel
Bogor. Proceeds from ELTY’s fourth rights issue was applied to acquire a further
600,000sqm of site area in this area.
Lake Lido Resort

Approximately IDR 350bn from ELTY’s rights issue was applied to the acquisition of
10.4mn sqm of land bank which forms part of the Lido Lake Resort in Sukabumi
(see Exhibit 32 for location map). The Lido Lake development has an existing hotel
(Lido Lakes Hotel) as well as an 18-hole golf course. Further development of the
land is expected to commence in 2011 in which we believe the area will be
earmarked for a new township development.
Bukit Jonggol
Bukit Jonggol is a vast land parcel (~130mn sqm including Karang Tengah) which
we understand will be earmarked for a new township development. The project is
51% owned by ELTY and was acquired recently with the proceeds from ELTY’s
fourth rights issue. Societe Strasbourg S.A. has a Profit Sharing Agreement in
which the investor may have the right to take a 25% stake in the project.
Construction of the infrastructure (roads and access) and marketing is expected to

commence in H1 11 per company estimates.

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Exhibit 38: Bukit Jonggol Development
Source: Company
Infrastructure Projects
ELTY completed the 35km toll road between Kanci and Pejagan in December
2009. As we understand, construction work has begun on the 54km toll road
between Ciawi and Sukabumi.
Exhibit 39: Trans Java Toll Road Network
Source: Company
Hotels & Resorts
ELTY’s hotels & resorts portfolio includes:

Resort or Hotel Name Location
Pullman Bali Legian Nirwana Bali
Nirwana Bali Resort Bali
Ubud Nirwana Villas Bali
Balikpapan Nirwana Residence Balikpapan
Aston Bogor Hotel & Resort Bogor
Krakatoa Nirwana Resort Lampung
Lido Lake Resort Sukabumi

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TIME LINE OF KEY EVENTS
Date Event
29 Sep 10 Local news reported that ELTY subsidiary, Bakrie Toll Road, may be looking to raise IDR 1 to 1.5trn in
new bonds to refinance existing indebtedness and fund new toll road constructions.
16 Aug 10 ELTY may have secured USD 50mn loan from Avenue Capital.
06 Aug 10 Rasuna Epicentrum Walk Office suites become operational.
08 Jul 10 ELTY completed its fourth rights issue of ~20bn shares at IDR 160 which raised IDR 3.2trn. Proceeds
were used to fund land acquisitions in Jonggol and Bogor.
28 Jun 10 Societe Strasbourg S.A. to provide USD 98.6mn (IDR 917bn) funding to ELTY as part of a Profit Sharing
Agreement for Bukit Jonggol land acquisition.
12 Mar 10 ELTY issues USD 155mn in 5 year convertible notes.
26 Jan 10 The Kanji-Pejagan toll road was officially opened by Indonesia's president.
Oct 09 ELTY consolidated project finance debt of ~IDR 1.36trn from Kanci-Pejagan toll road construction on to
its balance sheet by increasing its stake in PT Semesta Marga Raya to 65%.
Jul 09 ELTY issued IDR 150bn Sukuks.
Jul 09 Through PT Bakrie Nirwana Semesta, Bakrieland increased its capital investment in PT Bali Nirwana
Resort to 53%.
Oct 08 Avenue Capital acquired a 15.3% stake in the company.
Jul 08 Through PT Bakrie Infrastructure, ELTY acquired 75% shares in PT Alberta Utilities, which owns 5%
shares of PT Aetra Air Jakarta (previously PT Thames PAM Jaya), a clean water provider company in
Eastern Jakarta.
06 Jun 08 Limitless, a subsidiary of Dubai World acquired a 30% stake in BSU, BDM and SP (mainly Rasuna
Epicentrum development) for USD 110mn.
Mar 08 ELTY issued IDR 500bn local currency bonds with maturities in 2011 and 2013.
30 Apr 07 Avenue Luxembourg Sarl acquired a further 12.7% of the shares in PT Bakrieland Development Tbk.
30 Apr 07 Third Rights Issue of 14bn shares at IDR 200 per share for a total of IDR 2,800bn (5 shares for 2 held).
7 free warrants were attached to every 50 shares issued.
09 Dec 05 Avenue Luxembourg Sarl acquired a 12% stake in the company.
09 Dec 05 Second Rights Issue of 4.2bn shares at IDR 150 per share or a total of IDR 630bn raised (3 shares for 1
held).

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ORGANISATION STRUCTURE
PT Bakrie & Brothers Tbk CGM1 Client Segregated (Avenue Capital) Danatama Makmur Public
65%
14% 9%
12%
PT Bakrieland Development Tbk BLD Investment Pte. Ltd.

Indonesia Singapore
Limitless World International
Services Ltd IDR 220bn ELTYIJ 11.9% 03/11 USD 155mn ELTYIJ 8.625% Conv. Notes
(part of Dubai World) IDR 280bn ELTYIJ 12.85% 03/13
IDR 60bn ELTYIJ 15.48% 07/11 Ijarah Sukuk
IDR 90bn ELTYIJ 16% 07/12 Ijarah Sukuk
30.4%
69.6%
PT Bakrie Swasakti Utama (BSU) PT Bakrie Nirwana Semesta (BNS) PT Graha Andrasentra Propertindo (GAP)
Indonesia Indonesia Indonesia
IDR 15bn Bank Bukopin Back-to-Back Facility IDR 11.4bn Bank Bukopin WC Facility IDR 156bn BRI WC Construction II Loan Facility
IDR 26bn BRI WC Construction I Loan Facility IDR 114bn BRI WC Construction III Loan Facility
IDR 250bn BRI WC Construction II Loan Facility IDR 74bn BRI Investment Loan Facility
IDR 46.8bn BRI Investment Loan Facility
IDR 75bn Bank Bukopin WC Construction Loan PT Bumi Daya Makmur (BDM)
IDR 135bn Bank Bukopin Loan Facility Indonesia
IDR 17.9bn Bank Syariah Mandiri Club Deal Facility
IDR 3.3bn Bank OCBC NISP Loan IDR 122bn Bank Tabungan Negara Credit Facility PT Samudera Asia Nasional (SAN)
Indonesia
IDR 113.5bn BRI WC Construction III Loan Facility
Other On-shore Subsidiaries

PT Dutaperkasa Unggullestari (DPUL)
Indonesia
65%
IDR 43.5bn BRI WC Construction III Loan Facility
PT Mutiara Permata Biru (MPB)

Indonesia
IDR 10bn Bank Tabungan Negara Const. Facility I

IDR22.8bn Bank Tabungan Negara Const. Facility II
PT Bakrieland Development Tbk
PT Bakrie Infrastructure (BI) PT Bukit Jonggol Asri

51%
Indonesia Indonesia
IDR 917bn Societe Strasbourg S.A.

Societe Agreement
PT Bakrie Toll Road (BTR) PT Sentul City Tbk

Indonesia Indonesia
~5%
USD 45mn Beleggingsmaatschappij
Broem B.V. Term Loan Facility
PT Satria Cita Perkasa (SCP) Transglobal Finance Limited (TGF) Pan Galactic Invesment (PGI)
Indonesia British Virgin Island British Virgin Island
25% 15%
60%
PT Semesta Marga Raya (SMR)
Indonesia
IDR 1,360bn Syndicated Construction Credit Loan

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32
DESCRIPTION OF INDEBTEDNESS
Bakrieland Development Bonds I Year 2008
IDR 220bn ELTYIJ 11.9% 03/11
Issue date 11 Mar 08
Maturity 11 Mar 11
Interest 11.9% quarterly on 11 Mar, Jun, Sep, Dec
UoP Item Amount (IDR bn) Subsidiary

Bakrie Tower Office Dev. & BSU WC 13 BSU
The Wave Apt Project 50 BDM
Bank Bukopin debt repymt 70 BSU
Issue costs 7
Total 140
IDR 280bn ELTYIJ 12.85% 03/13

Maturity 11 Mar 13
Interest 12.85% quarterly on 11 Mar, Jun, Sep, Dec

Bakrie Tower Office Development 105 (All BSU at
Commercial Life Style 90 subsidiary)
Bank Bukopin debt repymt 80
Issue costs 5
Total 280
Collateral 120% of nomimal value or IDR 600bn

Land with Building Used Rights (HGB) No. 502/Karet Kuningan for 8,468 sqm which consists of Bakrie Tower buildings on behalf of PT Bakrie
Swasakti Utama (BSU), a Subsidiary
Land with HGB No. 526/Karet Kuningan for 1,277 sqm on behalf of BSU, a Subsidiary.
Covenants Maintain (per ELTY annual report):

EBITDA / interest exp > 2x
D/E < 2.25
Collateral > 120% of outs. Loan
Bakrieland Development Sukuk Ijarah I Year 2009

IDR 60bn ELTYIJ 15.48% 07/11 Ijarah Sukuk
Issue date 29 Jun 09
Maturity 07 Jun 11
Interest 15.48% quarterly on 7 Jul, Oct, Jan, Apr
IDR 90bn ELTYIJ 16% 07/12 Ijarah Sukuk

Issue date 29 Jun 09
Maturity 07 Jun 12
Interest 15.48% quarterly on 7 Jul, Oct, Jan, Apr

Development residential project 120 GAP and BSS
Development centre (UMKM) 20
Working capital 10
Total 150
Collateral 100% Residual Value Sukuk Ijarah return

A lot of land with right of building use certificate No. 1/Pasir Jaya, located in the Pasir Jaya village, Cijeruk district, Bogor regency in an area of
1,172,110 sqm under the name PT Bahana Sukmasejahtera.
Ijarah Obj The Jungle Edutainment Park and Jungle Mall.
Covenants Incurrence:
Interest Coverage > 2x
D/E < 2.25

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33
USD 155mn ELTYIJ 8.625% Conv. Notes 03/15
Maturity 23 Mar 15
Interest 8.625% quarterly on 23 Jun, Sep, Dec, Mar
Issuer BLD Investments Pte. Ltd.
Conv. Rate Each convertible bond with par value of USD 100,000 is convertible into 2,956,415.0090 Company shares.
Conv. Price Initial conversion price at the time of bonds issuance was IDR 309.07704 per share with fixed exchange rate on conversion date of IDR
9,137.6/USD 1.00.
Put 23 Mar 2013 @ 100
Delisting/CoC Put At par
UoP Item Amount (IDR bn)

Working capital 10
Refinancing 25
General corporate (estimate) 70
Equity swap - CS 50
Total 155
Covenants D/E < 2.25x

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34
DISCLAMER & DISCLOSURES
The author of this report receives compensation based, among other factors, on profits of SJS Markets Limited,
which are partially derived from investment banking activities related to financial instruments covered in the
report.
This report is for information purposes only and is not an offer or solicitation for the purchase of sale of any
financial instrument, nor a confirmation of terms of any instrument or transaction. The information is obtained
from sources believed to be reliable but, neither SJS Markets Limited nor any of its associated companies
(altogether “SJS”), warrant or give any representations as to its completeness, reliability or accuracy and is not
responsible for errors of transmission of factual or analytical data or for errors of interpretation; nor shall it be
liable contractually or otherwise for damages arising out of any person’s reliance upon this information. Prices,
terms and availability are indicative only and are subject to change without notice. SJS is acting solely in the
capacity of a potential arms-length transaction counterparty, or broker, and not as your fiduciary or adviser of
any kind in any transaction and should not be relied upon as such.
Prior to entering into any transaction you should ensure that you fully understand the potential risks and rewards
of that transaction and that you independently determine that the transaction is appropriate for you given your
objectives, experience, financial and operational resources and other relevant circumstances and that you are
willing to assume all such risks. You should consult with as many as, and to the extent you deem necessary, you
own advisors regarding the tax, accounting, financial, business, investment, regulatory or legal aspects of this
information to assist you in making that determination. Generally, all transactions involve the risk of adverse or
unanticipated market developments, risk of counterparty default, risk of illiquidity, and other risks. Those risks
can be substantial and result in unlimited losses.
In evaluating the above information you must remember that past experience is no guarantee of future
performance or return. SJS may from time to time make a market in or otherwise buy and sell instruments
identical or economically related to the above information. SJS may also have an investment banking, corporate
advisory, or other commercial relationship with any issuers or counterparties mentioned above.
To the extent that the terms of a transaction as set forth in any written confirmation provided by SJS conflict
with any statement made herein, such confirmation shall govern. This document may not be reproduced,
distributed or published for any purpose. Additional information is available upon request.
RATING KEYS
BUY: reflects our opinion that the respective security(ies) is(are) underpriced and/or the risk/rewards trade off is
compelling; upside potential outweigh downside risk. HOLD: reflects our opinion that that the respective
security(ies) is(are) fairly priced and/or potential upsides and downside risks is mostly balanced. SELL: reflects
our opinion that the respective security(ies) is(are) overpriced and/or risk/reward trade off is not compelling;
downside risks outweigh upside potential.
SOURCES
The source for all data and market prices is Bloomberg.
© 2010 SJS Markets Limited, member of SJ Seymour Group.

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October 15, 2010

SJS Markets Credit Research

+852 2868 9920

Issue Maturity Coupon Size Ratings Recommend.

ELTYIJ Mar 2015 8.625% 155 NR/NR 89 14.3% 1,341bp BUY

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Our Conservative NAV Estimate Adequately Covers Convertible

Based on our relatively conservative NAV calculations, we estimate that the

We calculated the NAV of ELTY’s property portfolio conservatively by valuing the

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Value of CBs 1,144.7

Source: SJS Markets estimates

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

The current president of Indonesia, Susilo Bambang Yudhoyono, is considering

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Jun 2010 Rights Issue IV 352.1 3,194

TOTAL 655.7 5,971.5

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Exhibit 5: LHS – ELTY's Recurring Cash Flows as a Percentage of Total

Toll road Hotel & Resort

Source: Company presentations and reports

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

We believe that ELTYIJ’15s is attractive on a relative value basis vs. other

Source: SJS Markets

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

We believe that forthcoming relaxation of foreign ownership rules would be positive

As we understand, current regulations prohibit foreigners to own properties. Instead,

Based on various estimates by the Department of Manpower and Transmigration,

… And Indonesia Property is a Relatively Attractive Investment

Compared to regional peers, we believe that Indonesian real estate could be an

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

6,000 5,449 5,251

Source: www.globalpropertyguide.com Taiwan

Exhibit 8: Gross Rental Yield for 120sqm Apartment in Capital City

…and highest gross rental 12.3%

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Exhibit 9: Indonesia GDP Growth (% Change YoY)

Secondly, we think that a sovereign rating upgrade to investment grade could be

Indonesia’s sovereign credit rating was upgraded to Ba2 (positive), BB (positive)

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Exhibit 10: Greater Jakarta (Jabodetabek) Population in Millions

Favourable Supply Demand Dynamics

An ELTY company presentation to investors published in August 2010 quoted

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Increasing GDP Per Capita, Underdeveloped Mortgage Industry and

We think that increasing GDP Per Capita, an underdeveloped mortgage industry

Exhibit 11: Mortgage Loans as % of GDP

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Indonesia Malaysia Thailand Singapore Philippines

See the back of the document for important disclosures

LAUSANNE DUBAI ALMATY LABUAN HONG KONG BEIJING

Exhibit 14: Bank Indonesia Reference Interest Rate