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Subject to CompletionPreliminary Offering Memorandum dated November 21, 2013

Offer of up to 1,500,000,000Common Shares of Par Value Rp100 Each

PT INDUSTRI JAMU DAN FARMASI SIDO MUNCUL Tbk

PT INDUSTRI JAMU DAN FARMASI SIDO MUNCUL Tbk, a company incorporated under the laws of the Republic of Indonesia (the

Company ), is offering up to 1,500,000,000 (one billion ve hundred million) common shares with a nominal value of Rp100 (one hundredRupiah) per share (the Shares ), representing 10% (ten percent) of the Companys total issued and paid up capital following completion of

the Offer (as de ned below). The Shares are being offered and distributed through PT Kresna Graha Sekurindo Tbk and PT Mandiri Sekuritas

(each a Joint Lead Underwriter and together the Joint Lead Underwriters ). The Shares are being offered in a public offer (includingan offering to Indonesian institutions and other investors) solely in Indonesia (the Indonesian Offer ), and in a global offering to institutionalinvestors (the Institutional Offer ) being conducted outside the United States in reliance on Regulation S ( Regulation S ) under theU.S. Securities Act of 1933, as amended (the U.S. Securities Act ). The Shares have not been and will not be registered under the U.S.Securities Act and may not be offered or sold within the United States, except pursuant to an exemption from, or in a transaction not subject

to, the registration requirements of the U.S. Securities Act. The Indonesian Offer and the Institutional Offer are collectively referred to as theOffer .

The Offering Memorandum (as de ned below) for the Institutional Offer consists of (1) this international offering memorandum, (2) theIndonesian Prospectus dated November 18, 2013 that has been prepared for the Indonesian Offer (the Indonesian Prospectus ) and (3)the English translation of the Indonesian Prospectus (the English Prospectus ), all of which should be read together prior to making an

investment decision to acquire the Shares. This international offering memorandum, the Indonesian Prospectus and the English Prospectusare referred to collectively as this Offering Memorandum . This Offering Memorandum is being made available with respect to the Institutional

Offer only. Prospective investors must accept that (i) in the event of inconsistency between the Indonesian Prospectus and the EnglishProspectus, the Indonesian Prospectus will prevail, and (ii) the Joint Lead Underwriters are not responsible for the accuracy of the translationof the Indonesian Prospectus to the English Prospectus (upon which certain parts of this international offering memorandum are based). All ofthe Companys nancial information contained in this Offering Memorandum is presented in Indonesian Rupiah and according to accountingprinciples generally applied in Indonesia.

This Offering Memorandum may only be distributed outside Indonesia to persons who are neither citizens of Indonesia (whereverlocated) nor residents of Indonesia.

The Offer is our initial public offering, and prior to the Offer there has been no public market for the Shares. On July 24, 2013, we obtainedthe preliminary approval for our Shares to be listed on the Indonesia Stock Exchange ( IDX). Our Shares are expected to begin trading onIDX on December 18, 2013.

For a discussion of certain risks you should consider in connection with an investment in the Shares, see Additional Risk Factorsin this international offering memorandum and Business Risks in Chapter VI of the English Prospectus.

On [], 2013 the exchange rate between the Indonesian Rupiah and the United States Dollar as reported by Bank Indonesia on its website atwww.bi.go.id was US$1.00=Rp[].

Offer Price: Rp[] per Share

Each purchaser of the Shares will be deemed to have made certain acknowledgements, representations and agreements with

respect to its purchase. For a description of these acknowledgements, representations and agreements and for certain restrictionson transfers, see Transfer Restrictions and Selling Restrictions in this international offering memorandum.

JOINT LEAD UNDERWRITERS

PT KRESNA GRAHA SEKURINDO TBK PT MANDIRI SEKURITAS

The date of this Offering Memorandum is [], 2013

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IMPORTANT NOTICE

NOT FOR DISTRIBUTION TO ANY PERSON NOT FALLING WITHIN THE CATEGORIES OFPERSONS SET OUT IN SCHEDULES 5, 6 AND 7 OF THE CAPITAL MARKETS AND SERVICESACT 2007.

NO APPROVAL, AUTHORISATION OR RECOGNITION OF THE SECURITIES COMMISSION OFMALAYSIA HAS BEEN OR WILL BE OBTAINED FOR THE OFFER OR INVITATION INRESPECT OF THE SHARES ON THE BASIS THAT THE SHARES WILL BE OFFERED OR SOLDEXCLUSIVELY TO PERSONS OUTSIDE MALAYSIA OR IF WITHIN MALAYSIA THEN ONLY BYWAY OF DISTRIBUTION OF THE SHARES, THROUGH A HOLDER OF A CAPITAL MARKETSSERVICES LICENCE CARRYING ON THE BUSINESS OF DEALING IN SECURITIES, TOCERTAIN PERSONS SPECIFIED IN PARAGRAPH 2(G) OF SCHEDULE 5 OF THE CAPITALMARKETS AND SERVICES ACT 2007 (CMSA).

THIS OFFERING MEMORANDUM HAS NOT AND WILL NOT BE REGISTERED WITH THESECURITIES COMMISSION OF MALAYSIA ON THE BASIS THAT THE SHARES WILL NOT BEOFFERED OR SOLD WITHIN MALAYSIA OTHER THAN TO CERTAIN PERSONS SPECIFIED INSCHEDULES 6 AND 7 OF THE CMSA (SELECTED QUALIFIED INVESTORS) AND THIS

OFFERING MEMORANDUM IS DEPOSITED WITH THE SECURITIES COMMISSION OFMALAYSIA IN ACCORDANCE WITH THE CMSA.

THE SECURITIES COMMISSION OF MALAYSIA SHALL NOT BE LIABLE FOR ANY NON-DISCLOSURE ON THE PART OF US AND ASSUMES NO RESPONSIBILITY FOR THECORRECTNESS OF ANY STATEMENTS MADE OR OPINIONS OR REPORTS EXPRESSED INTHIS OFFERING MEMORANDUM. SELECTED QUALIFIED INVESTORS SHOULD RELY ONTHEIR OWN EVALUATION TO ASSESS THE MERITS AND RISKS OF THE INVESTMENTPROPOSED HEREIN.

THE SOLE PURPOSE OF THIS OFFERING MEMORANDUM IS TO ASSIST A SELECTEDQUALIFIED INVESTOR IN DECIDING WHETHER IT WISHES TO PROCEED WITH A FURTHERINVESTIGATION OF THE COMPANY. THE INFORMATION IN THIS OFFERINGMEMORANDUM IS PROVIDED AS AT THE DATE OF THIS MEMORANDUM, EACH RECIPIENTOF THIS OFFERING MEMORANDUM ACKNOWLEDGES THAT THE INFORMATIONCONTAINED HEREIN SHALL UNDER NO CIRCUMSTANCES BE RELIED ON IN MAKING ADECISION TO SUBSCRIBE FOR THE SHARES. FURTHER, NO REPRESENTATION ORWARRANTY, EXPRESS OR IMPLIED, IS OR WILL BE MADE IN OR IN RELATION TO, AND NORESPONSIBILITY OR LIABILITY IS OR WILL BE ACCEPTED BY THE JOINT LEADUNDERWRITERS OR ANY ADVISER NAMED IN THIS OFFERING MEMORANDUM OR ANY OFTHEIR RESPECTIVE AFFILIATES, AGENTS, EMPLOYEES, DIRECTORS OR OTHER OFFICERSOR REPRESENTATIVES AS TO THE ACCURACY OF COMPLETENESS OF, THIS OFFERINGMEMORANDUM OR ANY OTHER WRITTEN OR ORAL INFORMATION MADE AVAILABLE TOANY INTERESTED PARTY OR ITS ADVISERS AND ANY LIABILITY THEREFOR IS HEREBYEXPRESSLY DISCLAIMED.

UNDER NO CIRCUMSTANCES SHALL THIS OFFERING MEMORANDUM CONSTITUTE ANOFFER FOR SUBSCRIPTION OR PURCHASE OF, OR AN INVITATION TO SUBSCRIBE FOR ORPURCHASE SECURITIES AND NOTHING CONTAINED IN THIS OFFERING MEMORANDUMSHALL FORM THE BASIS OF ANY CONTRACT, COMMITMENT OR INVESTMENT DECISIONWHATSOEVER.

THIS OFFERING MEMORANDUM IS BEING FURNISHED TO THE RECIPIENT ON A STRICTLYPRIVATE AND CONFIDENTIAL BASIS AND SOLELY FOR THE RECIPIENTS INFORMATIONAND MAY NOT BE REPRODUCED, DISCLOSED OR DISTRIBUTED (IN WHOLE OR IN PART)TO ANY OTHER PERSON AT ANY TIME .


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TABLE OF CONTENTS

Enforcement of Civil Liabilities .......................................................................................... .................... 4

Forward-Looking Statements ....................................................................................... ........................ 4

Summary of the Offer ..................................................................................... ...................................... 6

Additional Rrisk Factors ................................................................................................................... ..... 7

Securities Underwriting and Plan of Distribution .................................................................................. 11

Transfer Restrictions ................................................................................................. ............................ 12

Selling Restrictions ............................................................................................... ................................ 13

The Securities Market of Indonesia ....................................................................................... ............... 15

Indonesian Foreign Exchange Regulations .......................................................................................... 17

Exchange Rate Information ................................................................................................. ................. 18


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This Offering Memorandum is being furnished to investors by the Company in connection with anoffering exempt from registration under the U.S. Securities Act solely for the purpose of enabling aprospective investor to consider the purchase of the Shares as described in this OfferingMemorandum. The information contained in this Offering Memorandum has been provided by theCompany and other sources identified in this Offering Memorandum. No representation or warranty,express or implied, is made by the Joint Lead Underwriters or any adviser named in this Offering

Memorandum or any of their respective affiliates, agents, employees, directors or other officers orrepresentatives as to the accuracy or completeness of such information. Nothing contained in thisOffering Memorandum is, or shall be relied upon as, a promise or representation by the Joint LeadUnderwriters or any such advisers, affiliates, agents, employees, directors or other officers orrepresentatives. Each Joint Lead Underwriter expressly disclaims any and all liability that may bebased on such information, errors or omissions in this Offering Memorandum. No person is authorizedto give any information or to make any representation in connection with this Offer or sale of theShares other than as contained in this Offering Memorandum and, if given or made, such informationmust not be relied on as having been authorized by the Company, the Joint Lead Underwriters or anyof their affiliates or representatives. Neither the delivery of this Offering Memorandum nor the offer ofthe Shares shall, under any circumstances, constitute a representation or create any implication thatthere has been no change in the matters concerning the Company since the date of this OfferingMemorandum or that any information contained in this Offering Memorandum is correct at any time

subsequent to the date of this Offering Memorandum. By accepting delivery of this OfferingMemorandum, each offeree of the Shares agrees to the foregoing.

In making an investment decision, investors must rely on their own examination of this OfferingMemorandum, including the merits and risks involved. The contents of this Offering Memorandum arenot to be construed as legal, business or tax advice. Each prospective investor should consult its ownattorney, business adviser and tax adviser as to legal, business or tax advice. The Shares have notbeen approved, disapproved or recommended by the U.S. Securities and Exchange Commission, orthe securities commission of any other jurisdiction or regulatory authority (including the Monetary

Authority of Singapore or the Securities and Futures Commission of Hong Kong). None of theseauthorities have passed on or endorsed the merits of the Offer or the accuracy or adequacy of thisOffering Memorandum. Any representation to the contrary may be a violation of the laws of the UnitedStates and/or any other jurisdiction.

This Offering Memorandum is personal to the offeree to whom it has been delivered and does notconstitute an offer to any other person or to the public generally to subscribe for or otherwise acquirethe Shares.

Receipt and acceptance of this Offering Memorandum shall constitute the agreement of the recipient(1) to maintain the confidentiality of the information contained in this Offering Memorandum and anyother information that may be subsequently provided by the Company, any Joint Lead Underwriter orany of their respective representatives, either orally or in writing, (2) that any reproduction ordistribution of this Offering Memorandum or of any other information that the Company, any JointLead Underwriter or any of their respective representatives may subsequently provide, in whole or inpart, or any disclosure of any of the contents hereof or thereof to any other person other than

authorized representatives, agents and advisors of the recipient hereof, or any use of such materialsfor any purpose other than to evaluate an investment decision in the Shares, is strictly prohibited, and(3) if such recipient determines not to proceed with the investigation of an investment in the Shares,or if the Offer is terminated, to return to the Joint Lead Underwriters this Offering Memorandum andany other information that the Company, any Joint Lead Underwriter or any of their representativesmay subsequently provide to the recipient. This Offering Memorandum has been prepared forinformational purposes relating to the Offer only and upon the express understanding that it will beused only for the purpose set forth above.

This Offering Memorandum does not constitute an offer of, or an invitation by, or on behalf of, theCompany or the Joint Lead Underwriters to subscribe for, or purchase, any of the Shares and may notbe used for the purpose of an offer to, or a solicitation by, anyone in any jurisdiction or in anycircumstances in which such an offer or solicitation is not authorized or is unlawful. Neither the

delivery of this Offering Memorandum nor any sale made hereunder shall, under any circumstances,constitute a representation or create any implication that there has been no change in the Companys

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affairs since the date hereof or that the information contained herein is correct as of any timesubsequent to its date.

The distribution of this Offering Memorandum and the offer and sale of the Shares may be restrictedby law in certain jurisdictions. Persons into whose possession this Offering Memorandum or any ofthe Shares comes must inform themselves about, and observe, any applicable restrictions. For moreinformation, please see Securities Underwriting and Plan of Distribution, Transfer Restrictions andSelling Restrictions in this Offering Memorandum.

This Offering Memorandum does not constitute an offer to sell or a solicitation of an offer to buy any ofthe Shares to any person in any jurisdiction where it is unlawful to make such an offer or solicitation.

No person shall purchase any Shares in the Offer unless such person is eligible to acquire the Sharesin the Company in accordance with all applicable laws, rules, regulations, guidelines and approvals.Prospective investors will be required to confirm and will be deemed to have represented to theCompany, the Joint Lead Underwriters and their respective directors, officers, agents, affiliates andrepresentatives that they are eligible under all applicable laws, rules, regulations, guidelines andapprovals to acquire the Shares in the Company and will not offer, sell, pledge or transfer the Sharesof the Company to any person who is not eligible under applicable laws, rules, regulations, guidelinesand approvals to acquire the Shares in the Company. The Company, the Joint Lead Underwriters andtheir respective directors, officers, agents, affiliates and representatives accept no responsibility orliability for advising any investor whether such investor is eligible to acquire the Shares in theCompany.

Information on the Company or the Joint Lead Underwriters appearing on any website is not part ofthis Offering Memorandum.

This Offering Memorandum has been prepared for informational purposes relating to the InstitutionalOffer outside Indonesia only and upon the express understanding that it and the attached EnglishProspectus will be used for only the purpose set forth above.

Capitalized terms used in this Offering Memorandum that are not otherwise defined herein shall havethe same meaning ascribed to such terms in the attached English Prospectus.

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AVAILABLE INFORMATION

The Company will be required to comply with the regulations, including information requirements, ofIDX and the Financial Services Authority ( Otoritas Jasa Keuangan , or OJK ), the securities regulatorin Indonesia.

ENFORCEMENT OF CIVIL LIABILITIES

The Company is established and regulated under the laws of the Republic of Indonesia. All of theCompanys commissioners, directors and executive officers reside in Indonesia. Substantially all theCompanys assets are located within Indonesia. Any disputes arising in connection with the Companywill be subject to Indonesian laws and the jurisdiction of Indonesian courts only. As a result, anyaction arising from disputes in connection with the Company should be taken by investors inIndonesian courts, subject to Indonesian laws. However, should investors disregard theaforementioned, investors are advised that they may not be able to:

effect service of process upon the Company outside Indonesia; or

enforce any judgments in courts obtained outside Indonesia, including judgments based upon thesecurities laws of other countries, against the Company, the Company and/or any other entityinvolved in the management of the Company.

Indonesian courts will not enforce any judgment or order obtained outside Indonesia, but a judgmentor order from a foreign court may, in the discretion of a court in Indonesia, be admitted as evidence ofan obligation in a new proceeding instituted in an Indonesian court, which would consider the issue onthe evidence before it. Thus, to the extent investors are entitled to bring legal action against theCompany, investors may be limited in their remedies, and recoveries, if any, in any Indonesianproceedings may be limited at the relevant courts discretion.

FORWARD-LOOKING STATEMENTS

Certain statements in this Offering Memorandum may constitute forward-looking statements. Suchforward-looking statements are based on the beliefs of the Companys management as well asassumptions based on information available to the Company. Investors are cautioned not to rely onthese forward-looking statements. When used in this Offering Memorandum, the use of words such asmay, will, would, could, believe, expect, anticipate, intend, estimate, aim, plan,forecast or other similar expressions, as they relate to the Company or its management, areintended to identify forward-looking statements. Such forward-looking statements reflect theCompanys current views with respect to future events and are subject to certain risks, uncertaintiesand assumptions. Many factors could cause the actual results, performance or achievements of theCompany to be materially different from any future results, performance or achievements that may beexpressed or implied by such forward-looking statements. These factors (which are discussed inChapter VI of the English Prospectus and Chapter VI of the Indonesian Prospectus) include, without

limitation:

risks relating to operating activities, including:

o risk of fluctuations in raw material prices due to forces of nature

o risk of dependence on senior management team

o risk of business competition

o risk of interruptions in the Companys distribution network and supply chain

o risk of ineffective marketing campaign of the Companys products

o risk of defects in production machineries and equipment

o risk of defective products and product recalls from the marketo risk of human resources

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o risk of labor strikes

o risk of natural disasters and fire

risks relating to conditions in Indonesia, including:

o risk of changes in government policies or regulations

o risk of fluctuations in Rupiah exchange rate

o risk of social, economic, political and security conditions

risks associated with investment in the Companys Shares, including:

o risks associated with the relatively limited number of Shares offered in the Offer

o risks associated with fluctuations in market prices of the Shares

o risks associated with the capital markets in Indonesia

o risks associated with holding a non-controlling interest

o risks associated with dilution

o risks associated with the Companys ability to distribute dividends in the futureo risks of transactions with affiliates and conflicts of interest

Forward-looking statements involve risks, uncertainties and assumptions. If one or more of these risksor uncertainties occur, or if the underlying assumptions prove incorrect, the Companys actual resultsmay vary materially from the forward-looking statements contained in this Offering Memorandum. TheCompany undertakes no obligation to update or revise any forward-looking statements, whether as aresult of new information, future events or otherwise.

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SUMMARY OF THE OFFER

Issuer: PT Industri Jamu dan Farmasi Sido Muncul Tbk

Shares Offered: Up to 1,500,000,000 Shares, representing 10% ofthe Companys total issued and paid up capitalfollowing completion of the Offer

Nominal Share Value: Rp100 (one hundred Rupiah)

Offer Price: Rp[ ] per Share

Issue Size: Rp[ ] ([ ] Rupiah)

Dividend Policy: Please see Dividend Policy in Chapter XII of theattached English Prospectus

Use of Proceeds: Please see Use of Proceeds in Chapter II of theattached English Prospectus

Listing: Prior to the Offer, there has been no market forthe Shares. The Shares are to be registered with

IDX in accordance with the Preliminary SecuritiesRegistration Agreement entered into between theCompany and IDX on July 24, 2013. Trading ofthe Shares is expected to commence onDecember 18, 2013.

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ADDITIONAL RISK FACTORS

Prospective investors should carefully consider, in addition to the other information contained in thisOffering Memorandum, including under Business Risk in Chapter VI of the English Prospectus andChapter VI of the Indonesian Prospectus, the following additional risk factors before purchasing any ofthe Shares. Certain risks not presently known to the Company may also affect the Companys

business operations. In the following risk factors, information relating to the Government of Indonesiaand Indonesian macroeconomic data has been extracted from official government publications orother third party sources and has not been independently verified by the Company.

Limitations of this Offering Memorandum

The English Prospectus contained herein has been prepared by the Company as a courtesy forprospective investors in the Institutional Offer. None of the Joint Lead Underwriters, any dealer or anyunderwriter makes any representation or warranty as to the accuracy or completeness of the EnglishProspectus. The English Prospectus is a translation of the Indonesian Prospectus prepared for theIndonesian Offer based on statutory requirements and disclosure practices in Indonesia. Each personreceiving this Offering Memorandum acknowledges that disclosure requirements and practices inIndonesia, as in other emerging markets, differ significantly from disclosure requirements andpractices in many European countries, the United States and other jurisdictions and accordinglyacknowledges that this Offering Memorandum does not provide the level or type of disclosure that aprospective investor may require in connection with its investigation of the Company or when makingan investment decision.

Risks Relating to Indonesia

We are subject to the political, economic, legal and regulatory environment in Indonesia. Substantiallyall of our operations and assets are located in Indonesia. Our results of operations and financialcondition are affected by changes in Indonesian policies, laws and regulations. Investing in Indonesiaand companies located in Indonesia involves many risks, including the following:

Political instability in Indonesia could adversely affect the economy, which in turn could affectour business, financial condition and results of operations.

Since the collapse of the late President Soehartos regime in 1998, Indonesia has experiencedpolitical changes and, from time to time, instability, as well as general social and civil unrest onseveral occasions in recent years.

For example, since 2000, thousands of Indonesians have participated in demonstrations in Jakartaand other Indonesian cities both for and against former Presidents Wahid and Megawati and currentPresident Yudhoyono, as well as in response to specific issues, including fuel subsidy reductions,privatization of state assets, anti-corruption measures, decentralization and provincial autonomy,potential increases in electricity charges and the US-led military campaigns in Afghanistan and Iraq.

Although these demonstrations were generally peaceful, some have turned violent. In particular, onseveral occasions since June 2001, the Government of Indonesia has mandated increases in theprices of certain basic goods, such as fuel, which in turn sparked nationwide demonstrations andstrikes. In May 2008, the Government of Indonesia decreased fuel subsidies to the public, which ledto public demonstrations. There can be no assurance that future sources of popular discontent will notlead to further political and social instability.

Separatist movements and clashes between religious and ethnic groups have resulted in social andcivil unrest in certain parts of Indonesia. In the provinces of Aceh and Papua (formerly Irian Jaya),there have been clashes between supporters of separatist movements and the Indonesian military. InPapua, ongoing activity by separatist rebels has led to violent incidents. In the provinces of Malukuand Central Kalimantan, clashes between religious and ethnic groups have resulted in fatalities andrefugees over the past several years. In recent years, the governments negotiations with thesetroubled regions has had only limited success, except in the province of Aceh, where an agreementbetween the Government of Indonesia and Aceh separatists was reached in 2005 and peaceful localelections were held with some former separatists as candidates.

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In 2004, Indonesians directly elected the President, Vice-President and representatives to theIndonesian parliament for the first time. Indonesians have also started directly electing heads andrepresentatives of local and regional governments. In April 2009, elections were held to electrepresentatives to the Indonesian parliament (including national, regional and local representatives).Indonesian presidential elections, held in July 2009, resulted in the re-election of PresidentYudhoyono. Although parliamentary and presidential elections proceeded smoothly in 2004 and 2009,

political and related social developments in Indonesia have been unpredictable in the past. The nextparliamentary and presidential elections will occur in 2014, and President Yudhoyono will not beeligible to stand for reelection, which could lead to further political uncertainty or instability. There canbe no assurance that social and civil disturbances will not occur in the future and on a wider scale, orthat any such disturbances will not, directly or indirectly, materially and adversely affect our business,financial condition, results of operations and prospects.

A slowdown in global or Indonesian economic growth or economic contraction couldadversely affect us and our business, financial condition and results of operations.

Our performance is significantly dependent on the health of the overall global and Indonesianeconomy. The economic crisis that affected South East Asia, including Indonesia, from mid-1997 wascharacterized in Indonesia by, among other effects, currency depreciation, negative economic growth,

high interest rates, social unrest and extraordinary political developments. These conditions had amaterial adverse effect on Indonesian businesses. The economic crisis resulted in the failure of manyIndonesian companies to repay their debts when due.

Indonesian financial markets and the Indonesian economy are also influenced by economic andmarket conditions in other countries. The global financial crisis that began in 2008 had a significantimpact on certain segments of the Indonesian economy as well as the stability of Indonesian financialmarkets, as evidenced by the decrease in Indonesias real GDP growth rate from 6.3% in 2007 and6.0% in 2008 to 4.5% in 2009, based on data from BPS. A loss of investor confidence in the financialsystems of emerging or other markets may cause increased volatility in Indonesian financial marketswhich may, in turn, adversely affect the Indonesian economy in general. Any worldwide financialinstability could also have a negative impact on the Indonesian economy, which could have anadverse effect on our business, financial condition, results of operations and prospects. There can be

no assurance that the recent improvement in economic condition will continue or that adverseeconomic conditions will not recur. Such developments could have a material adverse effect on ourCompany and our business, financial condition, results of operations and prospects.

Downgrades of credit ratings of Indonesia could adversely affect the Indonesian financialmarket and our ability to finance operations and grow.

In 1997, certain international credit rating agencies, including Moodys, S&P and Fitch, downgradedIndonesias sovereign rating and the credit ratings of various credit instruments of the Government ofIndonesia, a large number of Indonesian banks and other companies. Currently, Indonesiassovereign foreign currency long-term debt is rated Baa3 by Moodys (upgraded from Ba1 onJanuary 18, 2012), BB+ by S&P (upgraded from BB on April 8, 2011 and affirmed on April 23,2012) and BBB- by Fitch (ungraded from BB+" on December 15, 2011 and affirmed on November22, 2012), and its sovereign foreign currency short-term debt is rated B by S&P and F3 by Fitch.Even though the recent trend in Indonesian sovereign ratings has been positive, we cannot assureyou that Moodys, S&P, Fitch or any other international credit rating agency will not downgrade thecredit ratings of Indonesia. Any such downgrade could have an adverse impact on liquidity inIndonesian financial markets, the ability of the Government of Indonesia and Indonesian companies,including our Company, to raise additional financing and the interest rates and other commercialterms at which such additional financing is available to us, any of which in turn may have a negativeeffect on our ability to finance operations and growth.

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Risks Relating to the Shares

Indonesian law may not protect shareholders as extensively as that of other jurisdictions.

Our corporate affairs are governed by our articles of association, by the laws governing corporationsincorporated in Indonesia, Indonesian capital market law and regulations and the rules of IDX and

OJK. The rights of our shareholders and the responsibilities of our Board of Commissioners andBoard of Directors under Indonesian law may be different from those applicable to a companyincorporated in another jurisdiction. Principal shareholders of Indonesian companies do not owefiduciary duties to minority shareholders, as compared, for example, to controlling shareholders in theUnited States. Our public shareholders may have more difficulty in protecting their interests inconnection with actions taken by members of our Board of Directors or Board of Commissioners or byour principal shareholders than they would as shareholders of a company incorporated in another

jurisdiction.

Indonesian law may operate differently from the laws of other jurisdictions with regard to theconvening of, and the right of shareholders to attend and vote at, general meetings ofshareholders of our Company.

We are subject to Indonesian law and the continuing listing requirements of IDX. In particular, theconvening and conduct of general meetings of our shareholders will continue to be governed byIndonesian law. The procedure and notice periods in relation to the convening of general meetings ofshareholders of our Company, as well as the ability of shareholders to attend and vote at suchgeneral meetings, may be different from those of jurisdictions outside Indonesia. For instance, theshareholders of our Company who would be entitled to attend and vote at general meetings ofshareholders of our Company are, by operation of Indonesian law, those shareholders appearing inour register of shareholders on the market day immediately preceding the day (the Record Date ) onwhich the notice of general meeting is issued, regardless of whether such shareholders may havedisposed of their shares following the Record Date. In addition, investors who may have acquiredtheir shares after the Record Date (and before the day of the general meeting) would not be entitledto attend and vote at the general meeting. Accordingly, potential investors should note that they maybe subject to procedures and rights with regards to general meetings of shareholders of our Company

that are different from those to which they may be accustomed in other jurisdictions.

We operate in a legal system in which the application of various laws and regulations may beuncertain, and through the purchase of the Shares, holders of our Shares may be exposed tosuch legal system and may find it difficult or impossible to pursue claims relating to theShares.

As Indonesia is a developing market, its legal and regulatory regime may be less certain than in moredeveloped markets and may be subject to unforeseen changes. At times, the interpretation orapplication of laws and regulations may be unclear and the content of applicable laws and regulationsmay not be immediately available to the public. Under such circumstances, consultation with therelevant authority in Indonesia may be necessary to obtain a better understanding or clarification ofapplicable laws and regulations. Indonesias legal system is a civil law system based on writtenstatutes; judicial and administrative decisions do not constitute binding precedent and are notsystematically published.

Indonesias commercial and civil laws as well as rules on judicial process were historically based onDutch law as in effect prior to Indonesias independence in 1945, and some of these laws have notbeen revised to reflect the complexities of modern financial transactions and instruments. Indonesiancourts are often unfamiliar with sophisticated commercial or financial transactions, leading in practiceto uncertainty in the interpretation and application of Indonesian legal principles. The application ofmany Indonesian laws depends, in a large part, upon subjective criteria such as the good faith of theparties to the transaction and principles of public policy, the practical effect of which, absent a bindingprecedent system, is difficult or impossible to predict.

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Indonesian judges operate in an inquisitorial legal system and have very broad fact-finding powersand a high level of discretion in relation to the manner in which those powers are exercised. As aresult, the administration and enforcement of laws and regulations by Indonesian courts andIndonesian governmental agencies may be subject to considerable discretion, uncertainty andinconsistency. Furthermore, corruption in the court system in Indonesia has been widely reported inpublicly available sources.

Indonesian legal principles relating to the rights of shareholders, or their practical implementation byIndonesian courts, differ from those that would apply within the United States or the European Union.

Absent a binding precedent system, the rights of shareholders under Indonesian law might not be asclearly evident as in most United States and European Union jurisdictions. In addition, underIndonesian law, companies may have rights and defenses to actions filed by shareholders that thesecompanies would not have in jurisdictions such as the United States and European Union memberstates.

Overseas shareholders may not be able to participate in future rights offerings or certain otherequity issues we may make.

If we offer or cause to be offered to our shareholders rights to subscribe for additional Shares or any

right of any other nature, we will have discretion as to the procedure to be followed in making suchrights available to our shareholders or in disposing of such rights for the benefit of our shareholdersand making the net proceeds available to such shareholders. To the extent permitted by Indonesianlaw, we may choose not to offer such rights or other equity issues to those of our shareholders havingan address in a jurisdiction where such an offering would require registration or would otherwise berestricted, or we may choose not to permit such shareholders to exercise their rights in this respect.

The regulations governing Indonesian securities markets differ from those in other markets,which may cause the market price of our shares to be more volatile.

Indonesian securities markets are less liquid and relatively more volatile compared to securitiesmarkets in certain other countries. IDX, on which our Shares will be listed, has in the past experiencedsubstantial fluctuations in the prices of listed securities. IDX has experienced some problems which,

were they to continue or recur, could affect the market price and liquidity of the securities ofIndonesian companies, including our Shares. These problems have included closures of exchanges,broker defaults and strikes, settlement delays, and the bombing of the IDX building. In addition, thegoverning bodies of Indonesian stock exchanges have from time to time imposed restrictions ontrading in certain securities, limitations on price movements and margin requirements. The levels ofregulation and monitoring of the Indonesian securities markets and the activities of investors, brokersand other market participants are not the same as in certain other countries. In addition, the ability tosell and settle trades on IDX may be subject to delays. In light of the foregoing, there can be noassurance that a holder of our Shares will be able to dispose of its Shares at the prices or times thatwould be available to such holder in a more liquid or less volatile market. There may also be lessinformation publicly available about Indonesian companies than is regularly made available by publiccompanies listed on other markets. Any of these factors could adversely affect the trading price of ourShares.

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SECURITIES UNDERWRITING AND PLAN OF DISTRIBUTION

The Company entered into a Deed of Underwriting Agreement No. 21 dated October 9, 2013, drawnup before Fathiah Helmi, SH., Notary in Jakarta, (hereinafter is as referred to UnderwritingAgreement ), under which the Joint Lead Underwriters and other underwriters whose names areidentified below agreed to offer and sell the Shares offered in the Offer based upon their respective

underwriting portion (provided, however that in the event of any discrepancies between the table setforth below and that set out in the Underwriting Agreement, the latter shall prevail) with fullcommitment and bind themselves to purchase the offered Shares that remain unsold at the close ofthe Offering Period.

Entity Underwriting PortionShares Percentage (%) Joint Lead Underwriters

PT Kresna Graha Sekurindo Tbk [ ] [ ]PT Mandiri Sekuritas [ ] [ ]

Subtotal [ ] [ ] [ ][ ][ ][ ][ ][ ][ ][ ][ ][ ][ ]

[ ][ ][ ][ ][ ][ ][ ][ ][ ][ ][ ]

[ ][ ][ ][ ][ ][ ][ ][ ][ ][ ][ ]

Subtotal [ ] [ ] TOTAL [ ] 100.00% Please see Chapter XIV Underwriting in the English Prospectus.

Listing and trading of the Shares on IDX

Potential investors must make all necessary arrangements to establish the requisite arrangements inorder to be able to trade the Shares on IDX (including opening securities trading accounts withlicensed financial intermediaries in Indonesia). Please contact your broker or financial adviser inIndonesia.

Registration with the Financial Services Authority

We submitted our application for a Registration Statement of Securities Issuance in relation to theOffer (the Registration Statement ) to OJK in a letter No. 031/IPO/X/2013 dated October 10, 2013in according to the Law of the Republic of Indonesia No. 8 Year 1995 concerning Capital Market,which was published in the State Gazette of the Republic of Indonesia No. 64 Year 1995, Supplementto State Gazette No. 3608 and its implementing regulations. The Chairperson of the FinancialServices Authority issued a letter No. [ ] on [ ] 2013, declaring the Registration Statement effective.

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Offering Period

The Offering Period is expected to be from December 9, 2013 to December 12, 2013. Listing of theShares on IDX is expected to commence on December 18, 2013.

TRANSFER RESTRICTIONS

Due to the following restrictions, investors are advised to consult with legal counsel prior to makingany resale, pledge or transfer of the Shares.

The Shares have not been and will not be registered under the U.S. Securities Act and may not beoffered or sold within the United States except in certain transactions exempt from the registrationrequirements of the U.S. Securities Act.

Each purchaser of the Shares, by accepting delivery of this Offering Memorandum and subscribing forShares, represents, agrees and acknowledges that:

It is authorized to consummate the purchase of the Shares in compliance with all applicable lawsand regulations.

It acknowledges (or if it is a broker-dealer acting on behalf of a customer, its customer hasconfirmed to it that such customer acknowledges) that such Shares have not been and will not beregistered under the U.S. Securities Act and that, therefore, such Shares cannot be offered, soldor resold except in transactions exempt from registration under the U.S. Securities Act.

It certifies that either (A) it is, or at the time the Shares are purchased will be, the beneficial ownerof the Shares and it is purchasing the Shares in an offshore transaction (within the meaning ofRegulation S) or (B) it is a broker-dealer acting on behalf of its customer and its customer hasconfirmed to it that (i) such customer is, or at the time the Shares are purchased will be, thebeneficial owner of the Shares, and (ii) such customer is purchasing the Shares in an offshoretransaction (within the meaning of Regulation S).

It is eligible under all applicable laws, rules, regulations, guidelines and approvals, to acquire theShares of the Company, and will comply with such laws, rules, regulations, guidelines andapprovals in any sale, pledge or transfer of the Shares of the Company.

It acknowledges that the Company, the Joint Lead Underwriters, their affiliates and others will relyupon the truth and accuracy of the foregoing acknowledgements, representations andagreements and agrees that, if any of such acknowledgements, representations or agreementsare no longer accurate, it will promptly notify the Company and the Joint Lead Underwriters, and ifit is acquiring any Shares as a fiduciary or agent for one or more accounts, it represents that ithas sole investment discretion with respect to each such account and that it has full power tomake the foregoing acknowledgements, representations and agreements on behalf of each suchaccount.

Any resale or other transfer, or attempted resale or other transfer, made other than in compliance withthe above-stated restrictions will not be recognized by the Company.

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SELLING RESTRICTIONS

This Offering Memorandum does not constitute an offer, solicitation or invitation to subscribe forand/or purchase the Shares in any jurisdiction in which such offer, solicitation or invitation is unlawfulor is not authorised or to any person to whom it is unlawful to make such offer, solicitation or invitation.The Shares are being offered and sold outside the United States in an offshore transaction (as

defined in Regulation S) in compliance with Regulation S. No action has been or will be taken underthe requirements of the legislation or regulations of, or of the legal or regulatory authorities of, theUnited States or any other jurisdictions, except that in Indonesia in order to permit the IndonesianOffer and that in Malaysia in order to permit the Institutional Offer in Malaysia. The distribution of thisOffering Memorandum and the offering of the Shares in jurisdictions other than Indonesia may beprohibited or restricted by the relevant laws in such jurisdictions. Persons who may come intopossession of this Offering Memorandum are required by the Company and the Joint LeadUnderwriters to inform themselves about, and to observe and comply with, any such prohibitions orrestrictions at their own expense and without liability to the Company and the Joint Lead Underwriters.

Persons to whom a copy of this Offering Memorandum has been issued shall not circulate to anyother person, reproduce or otherwise distribute this Offering Memorandum or any information hereinfor any purpose whatsoever nor permit or cause the same to occur.

Hong Kong

This Offering Memorandum has not been reviewed or approved by any regulatory authority in HongKong. In particular, this Offering Memorandum has not been, and will not be, registered as aprospectus in Hong Kong under the Companies Ordinance (Cap 32) ( CO ) nor has it beenauthorized by the Securities and Futures Commission ( SFC ) in Hong Kong pursuant to theSecurities and Futures Ordinance (Cap 571) ( SFO ). Recipients are advised to exercise caution inrelation to the Offer. If recipients are in any doubt about any of the contents of this OfferingMemorandum, they should obtain independent professional advice.

This Offering Memorandum does not constitute an offer or invitation to the public in Hong Kong toacquire any Shares nor an advertisement of the Shares in Hong Kong. This Offering Memorandummust not be issued, circulated or distributed in Hong Kong other than:

to professional investors within the meaning of the SFO and any rules made under thatordinance ( Professional Investors ); or

in other circumstances which do not result in this Offering Memorandum being a prospectus asdefined in the CO nor constitute an offer to the public which requires authorization by the SFCunder the SFO.

Unless permitted by the securities laws of Hong Kong, no person may issue or have in its possessionfor issue, whether in Hong Kong or elsewhere, any advertisement, invitation or document relating tothe Shares, which is directed at, or the content of which is likely to be accessed or read by, the public

of Hong Kong other than with respect to the Shares which are or are intended to be disposed of onlyto persons outside Hong Kong or only to Professional Investors.

Any offer of the Shares will be personal to the person to whom relevant offer documents are delivered,and a subscription for the Shares will only be accepted from such person. No person who hasreceived a copy of this Offering Memorandum may issue, circulate or distribute this OfferingMemorandum in Hong Kong or make or give a copy of this Offering Memorandum to any other person.No person allotted Shares may sell, or offer to sell, such Shares to the public in Hong Kong within sixmonths following the date of issue of such Shares.

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Malaysia

No approval, authorisation or recognition of the Securities Commission of Malaysia has been or willbe obtained for the offer or invitation in respect of the Shares on the basis that the Shares will beoffered or sold exclusively to persons outside Malaysia or if within Malaysia then only by way ofdistribution of the Shares, through a holder of a Capital Markets Services Licence carrying on the

business of dealing in securities, to certain persons specified in paragraph 2(g) of Schedule 5 of theCapital Markets and Services Act 2007 ( CMSA ).

This Offering Memorandum has not and will not be registered with the Securities Commission ofMalaysia on the basis that the Shares will not be offered or sold within Malaysia [other than to certainpersons specified in Schedules 6 and 7 of the CMSA and this Offering Memorandum is deposited withthe Securities Commission of Malaysia in accordance with the CMSA.

The Securities Commission of Malaysia shall not be liable for any non-disclosure on the part of us andassumes no responsibility for the correctness of any statements made or opinions or reportsexpressed in this Offering Memorandum. Investors should rely on their own evaluation to assess themerits and risks of the investment proposed herein.

Singapore

This Offering Memorandum has not been and will not be registered as a prospectus with the Monetary Authority of Singapore ( MAS ) under the Securities and Futures Act (Chapter 289) of Singapore(SFA ). Accordingly, the Shares may not be offered or sold, or made the subject of an invitation forsubscription or purchase nor may the Offering Memorandum or any other document or material inconnection with the offer or sale, or invitation for subscription or purchase of the Shares be circulatedor distributed, whether directly or indirectly, to the public or any member of the public in Singaporeother than to (i) an institutional investor within the meaning of Section 274 of the SFA and inaccordance with the conditions of an exemption invoked under Section 274, (ii) to a relevant personunder Section 275(1) of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditionsof, any other applicable provision of the SFA.

Any transfer or on-selling of the Shares is subject to applicable on-selling restrictions and must meetthe requirements set out in the SFA.

United States of America

The Shares have not been and will not be registered under the U.S. Securities Act and may not beoffered or sold within the United States except in certain transactions exempt from the registrationrequirements of the U.S. Securities Act.

The Shares are being offered and sold only outside the United States in offshore transactions inaccordance with Regulation S. Each person who purchases Shares outside the United States incompliance with Regulation S, by its acceptance of this Offering Memorandum and the Shares, will bedeemed to have acknowledged, represented to and agreed with the Company and the Joint LeadUnderwriters as follows:

(1) Such purchaser of the Shares is, or at the time of its acquisition of the Shares will be, thebeneficial owner of the Shares purchased by it.

(2) At the time of its acquisition of the Shares, such purchaser is not resident in the United States.

(3) With respect to sales of the Shares, either:

(a) at the time the buy order for the Shares was originated, the purchaser was outsidethe United States or the purchaser of the Shares and any person acting on its behalfreasonably believed that the purchaser was outside the United States; or

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(b) the transaction in the Shares was executed in, on or through the facilities of adesignated offshore securities market as defined in Regulation S (including, for theavoidance of doubt, a bona fide sale on IDX).

(4) Such purchaser of the Shares is not an affiliate of the Company or acting on our behalf or onbehalf of any such affiliate.

(5) Neither the purchaser of the Shares, any of its affiliates nor any person acting on its or theirbehalf, has made, and the purchase of the Shares is not the result of, any directed sellingefforts (as defined in Regulation S) in the United States with respect to the Shares.

(6) The proposed transfer of the Shares is not part of a plan or scheme to evade the registrationrequirements of the U.S. Securities Act.

(7) The purchaser is aware that the Shares may not be offered, sold, pledged or otherwisetransferred except in an offshore transaction in compliance with Regulation S.

(9) Each purchaser of the Shares agrees that the Company and the Joint Lead Underwriters,their respective affiliates and their respective agents may rely upon the truth and accuracy of

the foregoing acknowledgments, representations and agreements.

(10) In addition, each prospective purchaser of the Shares, by its acceptance thereof, will bedeemed to have acknowledged, represented to and agreed with the Company and the JointLead Underwriters as follows:

(a) that none of the Company and the Joint Lead Underwriters or any personrepresenting the Company and the Joint Lead Underwriters has made anyrepresentation or provided any information to it with respect to the Company or theoffering or sale of the Shares, other than the information contained or incorporated byreference in the Offering Memorandum, which has been delivered to it and uponwhich it is relying in making its investment decision with respect to the Shares; and ithas had access to such financial and other information concerning the Company and

the Shares as it has deemed necessary in connection with its decision to purchasethe Shares.

(b) that the Company and the Joint Lead Underwriters and others will rely upon the truthand accuracy of the acknowledgments, representations and agreements made byeach perspective purchaser, and such prospective purchaser agrees that, if any ofthe acknowledgments, representations or agreements deemed to have been made byit through its purchase of the Shares are no longer accurate, it shall promptly notifythe Company and the Joint Lead Underwriters; and if it is acquiring any Shares asfiduciary or agent for one or more investor accounts, it represents that it has soleinvestment discretion with respect to each such account and that it has full power tomake the foregoing acknowledgments, representations and agreements on behalf ofeach such account.

Each Joint Lead Underwriter has represented that it has not entered and agreed that it will not enterinto any contractual arrangement with any distributor with respect to the distribution of the Shares,except its affiliates or with the prior written consent of the Company.

Terms used in this section have the meanings given to them by Regulation S.

THE SECURITIES MARKET OF INDONESIA

The following information has been derived from publicly available information and has not beenindependently verified by the Company or the Joint Lead Underwriters. More information is availableat www.bi.go.id, www.ojk.go.id, www.bapepam.go.id and www.idx.co.id.

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More information is available from www.idx.co.id.

Listing of the Shares

[Based on the Preliminary Securities Registration Agreement dated July 24, 2013, the Companyobtained the preliminary approval for its Shares to be listed on IDX]. Unless and until the Registration

Statement is declared effective and listing approval is given, none of the Shares sold in the Offer maybe traded on IDX. Buyers and sellers may be matched in off-exchange transactions after the Shareshave been listed on IDX. After the Shares are approved for listing on IDX, Shares sold in the Offerthat are purchased by non-Indonesian persons will be eligible for trading on IDX.

Settlement

All clearance and settlement of transactions effected on IDX must be settled three trading daysfollowing completion of the transaction.

INDONESIAN FOREIGN EXCHANGE REGULATIONS

Foreign Exchange

The Government of Indonesia does not currently maintain exchange controls and the Rupiah is freelyconvertible. Pursuant to Law Number 24 of 1999 on Foreign Exchange Flow and Exchange RateSystem ( Law 24 ) any Indonesian resident (a person, legal entity or other entity domiciled or planningto domicile in Indonesia for at least 1 (one) year, including representatives and diplomatic staff of theRepublic of Indonesia) is free to own and use foreign exchange.

Indonesias central bank, Bank Indonesia, is the monetary authority charged with responsibility formaintaining the stability of the Rupiah and overseeing the foreign exchange system and exchangerate systems. Bank Indonesia is authorized to control the flow of foreign exchange activities ofIndonesian residents. In this respect, Bank Indonesia is empowered to request any information anddata concerning the foreign exchange activities of Indonesian residents. Through its implementingregulations (namely Regulation of Bank Indonesia No. 1/9/PBI/1999, Regulation of Bank IndonesiaNo. 13/15/PBI/2011, in conjunction with the Circular Letter of Bank Indonesia No. 13/21/DSM dated

August 15, 2011 and Regulation of Bank Indonesia No. 13/21/PBI/2011), Bank Indonesia requiredBanks and Non-Financial Institutions to submit a report to Bank Indonesia with respect to their foreignexchange flow activities. Non-Financial Institutions that are obliged to submit this kind of reportinclude:

1. State-owned enterprises;

2. State-owned enterprises with foreign loans;

3. Non-bank financial institutions;

4. Public companies;

5. Companies who are engaged in the business of oil and gas mining;

6. Companies who are engaged in export and/or import of goods;

7. Companies who provide services;

8. Foreign investment companies;

9. Private companies with foreign loans;

10. Other entities with foreign loans; or

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11. Non-bank financial institutions that do not fall within categories (1) to (10), with:

a. total assets of at least Rp100,000,000,000.- (one hundred billion Rupiah), or

b. revenue during a 1 year period of at least Rp100,000,000,000.- (one hundred billion Rupiah);

whichever is fulfilled earlier.

Exchange Rate System

Bank Indonesia implements the exchange rate system determined by the Government of Indonesia,based on proposals submitted by Bank Indonesia. Pursuant to Law 24 and Law No. 2 of 2008, asamended by Law No. 6 of 2009 ( Law 2 ), the exchange rate system to be applied in Indonesia maybe in the form of a fixed exchange rate, floating exchange rate or controlled floating exchange ratesystem. Law 2 assigns Bank Indonesia with a principal duty to reach and maintain the stability of theRupiah. In this respect, Bank Indonesia is authorised to intervene in the foreign exchange market inorder to maintain the stability of the Rupiah. Prior to August 1997 Bank Indonesia maintained thevalue of the Rupiah based on a basket of foreign currencies, the composition of which was based onIndonesias main trading partner countries. In July 1997 the exchange rate band was widened and on

August 14, 1997 Bank Indonesia adopted a floating exchange rate system without indicating at whatlevel Bank Indonesia would intervene in the currency markets.

More information is available from www.bi.go.id.

EXCHANGE RATE INFORMATION

Fluctuation in the exchange rates between the Rupiah and other currencies will affect the foreigncurrency equivalent of the Rupiah of the shares on IDX. Such fluctuation will also affect the amount inforeign currency received upon conversion of cash dividends or other distributions paid in Rupiah bythe Company on, and the Rupiah proceeds received from any sales of, the Shares, as well as thebook value of foreign currency assets and liabilities, and income and expenses and cash-flows in theCompanys financial statement.

The following table shows the exchange rate of the Rupiah against the United States Dollar based onthe middle exchange rates at the end of each month during the periods indicated. The Rupiah middleexchange rate is calculated based on Bank Indonesia buying and selling rates. No representationsare made that the Rupiah or United States Dollar amount referred to herein could have been or couldbe converted in United States Dollar or Rupiah, as the case may be, at the rate indicated or any otherrate or at all.

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At Period End High (1) Low (1)

2000 9,595 9,595 7,425

2001 10,400 11,675 9,450

2002 8,940 10,320 8,7302003 8,465 8,908 8,285

2004 9,290 9,415 8,441

2005 9,830 10,310 9,165

2006 9,020 9,395 8,775

2007 9,419 9,419 8,828

2008 10,950 12,151 9,051

2009 9,400 12,065 9,293

2010 8,991 9,413 8,909

2011 8,709 9,068 8,708

2012 9,670 9,707 8,892

January 2013 9,698 9,740 9,635

February 2013 9,667 9,725 9,634

March 2013 9,719 9,745 9,678

April 2013 9,722 9,756 9,688

May 2013 9,802 9,811 9,728

June 2013 9,929 9,960 9,790

July 2013 10,278 10,278 9,934

August 2013 10,924 10,950 10,287

September 2013 11,613 11,613 10,922

October 2013 11,234 11,593 11,076 November 2013 (through November 13, 2013) 11,644 11,644 11,354

Source: www.bi.go.id

(1) The high and low amounts are determined based on the Bank Indonesia middle exchange rate at the end ofeach month announced by Bank Indonesia during the period indicated.

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This document is an unof cial English translation of the Prospectus issued by the Company in Bahasa Indonesia on its initial public offering conducted in the Republicof Indonesia and is provided by the Company for information purposes only. The Prospectus has been prepared in accordance with the regulatory framework anddisclosure practices in the Republic of Indonesia and neither the Company nor the Joint Lead Underwriter makes any representation or warranty as to the accuracy orthe completeness of this translation of the Prospectus. Each person receiving this document acknowledges that disclosure requirements and practices in the Republicof Indonesia, as in other emerging markets, differ signi cantly from disclosure requirements and practices in other jurisdictions. Accordingly, each person receivingthis document acknowledges that this document does not provide the level or type of disclosure that a prospective investor may require in connection with making aninvestment decision with regards to the Offering. In the event that a prospective investor would like to obtain more information about the Company and/or the Offeringbefore making an investment in the Company, it would be advisable for such potential investor to read the Prospectus in Bahasa Indonesia.

INDICATIVE SCHEDULEPreliminary Offering Period : 18 29 November 2013 Estimated Refund Date : 17 December 2013Estimated Effective Date : 5 December 2013 Estimated Electronic Share Distribution Date : 17 December 2013Estimated Offering Period : 9 12 December 2013 Estimated Listing Date on IDX : 18 December 2013Estimated Allotment Period : 16 December 2013

INFORMATION IN THIS DOCUMENT IS STILL SUBJECT TO FURTHER COMPLETION AND/OR AMENDMENTS. THE REGISTRATION STATEMENT OF THSHARES HAS BEEN SUBMITTED TO THE FINANCIAL SERVICES AUTHORITY (OJK) BUT HAS YET TO RECEIVE THE EFFECTIVE STATEMENT FROMTHE OJK. THIS DOCUMENT SHALL ONLY BE USED WITH REGARD TO PRELIMINARY OFFERING OF THE SHARES. THE SHARES ARE NOT TRADEBEFORE THE REGISTRATION STATEMENT SUBMITTED TO OJK BECOMES EFFECTIVE. SUBSCRIPTION OF SHARES SHALL ONLY BE EXERCISED AFTERPROSPECTIVE BUYERS OR SUBSCRIBERS HAVE RECEIVED OR HAVE ACCESS TO THE PROSPECTUS.

THE OJK DOES NOT GIVE ITS APPROVAL OR DISAPPROVAL OF THE SHARES DESCRIBED HEREIN, NOR DOES IT CONFIRM THE ACCURACY ORCOMPLETENESS OF THIS PROSPECTUS. ANY STATEMENT WHICH IS CONTRADICTORY TO THE SAME SHALL CONSTITUTE AN UNLAWFUL ACT.

PT INDUSTRI JAMU DAN FARMASI SIDO MUNCUL TBK (THE COMPANY) AND THE JOINT LEAD UNDERWRITERS ARE FULLY RESPONSIBLE FOR THACCURACY OF ALL INFORMATION OR MATERIAL FACTS AND THE ACCURACY OF OPINIONS CONTAINED IN THIS PROSPECTUS.

ALL OF THE OFFERED SHARES WILL BE LISTED ON THE INDONESIA STOCK EXCHANGE (IDX).

PT INDUSTRI JAMU DAN FARMASI SIDO MUNCUL Tbk Line of Business:

Engaged in Traditional Medicine and Pharmaceutical Industry Business

Domiciled in Semarang, IndonesiaHead Of ce:

Menara Suara Merdeka Building, 16th Floor Jl Pandanaran No.30

Semarang 50134, IndonesiaPhone: (+6224) 7692-8811

Fax: (+6224) 7692-8815Website: www.sidomuncul.com

Factory:Jl Soekarno Hatta km 28

Kecamatan Bergas, Klepu

Semarang 50552, IndonesiaPhone: (+62298) 523-515Fax: (+62298) 523-509

INITIAL PUBLIC OFFERINGUp to 1,500,000,000 (one billion ve hundred million) ordinary registered shares that are new shares or approximately 10% (tenpercent) of the Companys total issued and paid-up capital after the Initial Public Offering, at a nominal value of Rp100 (one hundredRupiah) per share, which are offered to the Public at the Offer Price of Rp ( Rupiah) per share, which has to be fully paid uponsubmission of the SSF. The total value of the Initial Public Offering is Rp ( Rupiah). All shareholders of the Company have equal and similar rights with respect to the Companys existing issued and fully paid-upshares, in accordance with Law No. 40 Year 2007 regarding Limited Liability Company (Company Law).Based on Deed No. 33 dated 18 September 2013, drawn up before Fatiah Helmi, SH., Notary in Jakarta, the Company will implementthe ESA program by allocating shares up to 10% (ten percent) of the number of Offered Shares, taking into account the legislationin force. Detailed information on the ESA program is described in Chapter I of this Prospectus.

The Joint Lead Underwriters and the Underwriters whose names are listed below shall guarantee with full commitment the InitialPublic Offering of the Companys shares in accordance with their respective underwriting portion.

JOINT LEAD UNDERWRITERS

PT Kresna Graha Sekurindo Tbk PT Mandiri Sekuritas

UNDERWRITERSTo Be Determined

THE PRIMARY RISK FACED BY THE COMPANY IS THE RISK OF FLUCTUATION IN RAW MATERIAL PRICES DUE TO FORCES OF NATURE. THE COMPLETRISKS FACED BY THE COMPANY ARE DETAILED IN CHAPTER VI OF THIS PROSPECTUS.

THE RISK RELATING TO THE OWNERSHIP OF THE COMPANYS SHARES IS THE ILLIQUIDITY OF THE SHARES OFFERED IN THIS INITIAL PUBLIOFFERING DUE TO THE LIMITED SHARES OFFERRED TO THE PUBLIC, THERE IS A POSSIBIILITY THE SHARES TRADED ON THE IDX MAY BE ILLIQUTHEREFORE, THE COMPANY IS UNABLE TO PREDICT WHETHER THERE WILL BE AN ACTIVE MARKET OR WHETHER THE LIQUIDITY OF THE SHARWILL BE MAINTAINED.

THE COMPANY WILL NOT ISSUE COLLECTIVE SHARES CERTIFICATES IN THIS INITIAL PUBLIC OFFERING, THE SHARES WILL BE DISTRIBUTEELECTRONICALLY AND ADMINISTERED IN THE COLLECTIVE DEPOSITORY OF PT KUSTODIAN SENTRAL EFEK INDONESIA (KSEI).

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PT Industri Jamu dan Farmasi Sido Muncul Tbk (hereinafter referred to in this Prospectus as the Company) hasled a Registration Statement with regard to this Initial Public Offering to Financial Services Authority (Otoritas JasaKeuangan or the OJK) in Jakarta by virtue of letter No. 031/IPO/X/2013 dated 10 October 2013, in accordance withthe requirements as set forth in Law No. 8 year 1995 dated 10 November 1995 regarding the Capital Market, that wasannounced in the State Gazzette of the Republic of Indonesia No. 64 Year 1995, Supplemental No. 3608 (hereinafterreferred to as the Capital Market Law) and the implementing regulations and amendments thereof.

The offered shares in this Initial Public Offering are to be registered on the IDX in accordance with the PreliminarySecurities Registration Agreement entered into between the Company and IDX on 24 July 2013, subject to thesatisfaction of the registration requirements as determined by the IDX, among others concerning the number ofindividual and institutional Shareholders at IDX and each Shareholder holding at least 1 (one) unit of share. In theevent that the share registration requirements are not met, the Initial Public Offering shall be null and void by law andthe subscription fund received shall be returned to the subscribers in accordance with the provisions of the CapitalMarket Law and its implementing regulations.

For the purpose of this Initial Public Offering, the Company, the Joint Lead Underwriters, Underwriters and the CapitalMarket Supporting Professions are fully responsible for the accuracy of data, accuracy of opinions, statements andreports presented in the Prospectus pursuant to their respective areas of duty in accordance with the prevailingregulations applicable in the territory of the Republic of Indonesia as well as their respective code of ethics, norms andstandards of profession.

In connection with the Initial Public Offering, every af liated party shall not give any statement or remarks or explanationwhatsoever with regard to matters that have not been disclosed in this Prospectus without the prior written approvalfrom the Company and the Joint Lead Underwriters.

PT Kresna Graha Sekurindo Tbk and PT Mandiri Sekuritas as Joint Lead Underwriters, as well as the Capital MarketSupporting Institutions and Professions with regard to this Initial Public Offering are not af liated with the Company,either direct or indirectly, in accordance with the de nition of Af liate as set forth in the Capital Market Law. Furtherdescription regarding relationship of af liate is described in Chapter XIV regarding Underwriting and Chapter XV

regarding Capital Market Supporting Institutions and Professions.THIS INITIAL PUBLIC OFFERING IS NOT REGISTERED UNDER ANY LAW OR REGULATION OTHER THANTHOSE APPLICABLE IN THE REPUBLIC OF INDONESIA. WITH RESPECT TO ANY PERSON OUTSIDE OFTHE REPUBLIC OF INDONESIA RECEIVING THIS PROSPECTUS, THIS PROSPECTUS IS NOT MEANT ASAN OFFER DOCUMENT TO PURCHASE THE SHARES, EXCEPT WHERE SUCH OFFER AND PURCHASEOF SHARES DO NOT CONTRADICT, OR DO NOT CONSTITUTE A VIOLATION UNDER, THE LAWS ANDREGULATIONS PREVAILING IN SUCH COUNTRY.

THE COMPANY HAS DISCLOSED ALL MATERIAL INFORMATION REQUIRED TO BE DISCLOSED TO THEPUBLIC, AND NO MATERIAL INFORMATION HAS BEEN OMITTED WHICH MAY CAUSE THE INFORMATIONCONTAINED IN THIS PROSPECTUS TO BE INCORRECT OR MISLEADING.


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TABLE OF CONTENT

TABLE OF CONTENT i

DEFINITIONS AND ABBREVIATIONS iii

SUMMARY xi

CHAPTER I INITIAL PUBLIC OFFERING 1

CHAPTER II USE OF PROCEEDS 6

CHAPTER III INDEBTEDNESS 8

CHAPTER IV KEY FINANCIAL HIGHLIGHTS 15

CHAPTER V MANAGEMENTS DISCUSSION AND ANALYSIS 20General1. 21

Factors Affecting the Companys Financial and Operational Condition2.21

Financial3. 23Risk Management4. 38

CHAPTER VI BUSINESS RISKS 40

CHAPTER VII MATERIAL EVENTS OCCURED SUBSEQUENT TO THE INDEPENDENT AUDITORSREPORT 46

CHAPTER VIII DESCRIPTION OF THE COMPANY AND ITS SUBSIDIARIES 48Brief History of the Company1. 48Licenses and Permits of the Company2. 50Development of the Companys Share Ownership3. 51Structure of Directors and Commissioners4. 57

Human Resources (HR)5. 63The Companys Organization Structure6. 66Description of the Subsidiaries7. 67 Associations by way of Ownership, Management and Supervision of the Company8.and its Subsidiaries 76Transactions with Af liated Parties9. 77Insurance10. 79Material Agreements with Third Parties11. 81Legal Proceedings faced by the Company12. 83The Companys Fixed Assets Register 13. 83Intellectual Property Rights14. 87

CHAPTER IX BUSINESS ACTIVITIES AND PROSPECTS OF THE COMPANY 93Overview1. 93Competitive Advantages2. 94Business Strategies3. 96Business Activities4. 96Information on the Companys Products5. 98Raw Materials Management6. 99Production Process7. 102Distribution and Marketing Activities8. 112Business Competitions9. 117Business Prospects10. 118Business Research and Development11. 118UKL (12. Upaya Pengelolaan Lingkungan,Environment Management)and UPL (Upaya Pemantauan Lingkungan,Environment Monitoring Efforts) 118Good Corporate Governance13. 118

The Companys Corporate Social Responsibility14.119

Certi cates and Awards15. 120


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CHAPTER X OVERVIEW OF HERBAL MEDICINE INDUSTRY IN INDONESIA 124

CHAPTER XI EQUITY 140

CHAPTER XII DIVIDEND POLICY 142

CHAPTER XIII TAXATION 143

CHAPTER XIV UNDERWRITING 147

CHAPTER XV CAPITAL MARKET SUPPORTING INSTITUTIONS AND PROFESSIONSWITH REGARD TO INITIAL PUBLIC OFFERING 149

CHAPTER XVI LEGAL OPINION 156

CHAPTER XVII THE COMPANYS FINANCIAL STATEMENTS AND INDEPENDENT AUDITORSREPORT 153

CHAPTER XVIII INDEPENDENT APPRAISAL REPORT 253

CHAPTER XIX ARTICLES OF ASSOCIATION OF THE COMPANY 273

CHAPTER XX TERMS OF SHARE SUBSCRIPTION 295

CHAPTER XXI DISTRIBUTION OF PROSPECTUS AND SHARE SUBSCRIPTION FORMS 301


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DEFINITIONS AND ABBREVIATIONS

Account Holders Refers to parties registered as Securities Account Holder in KSEI orCustodian Banks and/or Securities Companies.

ACF Refers to the abbreviation of Allotment Confirmation Form, a form whichcontains the final allotment result for the subscribers that serves asevidence of ownership of shares offered in the primary market.

Affiliate Refers to parties as defined in Capital Market Law and its implementingregulations as follows:

a) Family relationship by either marriage or descents up to the seconddegree, horizontally and vertically;

b) Relationship between the parties and employees, Directors orCommissioners of such parties;

c) Relationship between 2 (two) companies having 1 (one) or morecommon directors or commissioners;

d) Relationship between the company and the party which, directly orindirectly, controls or is controlled by the company;

e) Relationship between 2 (two) companies under common control,either directly or indirectly; or

f) Relationship between the company and its principal shareholders.

Affiliated Subscribers Refers to members of the Directors, members of the Board ofCommissioners and the employees of the Company, except theIndependent Commissioner, who, during the Offering Period, submit

Shares Subscriptions to the Company at a maximum amount of 10%(ten percent) of the Offered Shares in accordance with Rule No. IX.A.7.

Agreement on SecuritiesRegistration at KSEI

Refers to the Agreement on Equity Securities Registration at KSEI No.SP-0024/PE/KSEI/0713 dated 16 July 2013, privately arranged and dulystamped, between the Company and KSEI.

Allotment Date Refers to the date jointly agreed by the Company and the Joint LeadUnderwriters,namely no later than 2 (two) Business Days following theclosing of the Offering Period, which will be determined in theProspectus.

Allotment Manager Refers to PT Kresna Graha Sekurindo Tbk, as the Joint LeadUnderwriter, the party responsible for the allotment of Offered Shares inaccordance with the requirements set forth in Rule No. IX.A.7, Annex tothe Decree of Chairman of Bapepam and LK No. Kep-691/BL/2011dated 30 December 2011 regarding Subscribtion and Allotment in InitialPublic Offering (hereinafter referred to as Rule No. IX.A.7).

Banking Day Refers to Bank working day, i.e., the days where Bank Indonesiaperforms interbank clearing process.


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Bapepam & LK Refers to theBadan Pengawas Pasar Modal & Lembaga Keuangan(Capital Market and Financial Institution Supervisory Board) as definedin Article 3 Paragraph 1 of the Capital Market Law and Decree ofFinance Minister No. 184/PMK.01/2010 dated 11 October 2010regarding Organization and Work Procedure of the Ministry of Finance.

Book Building Refers to direct or indirect offering through Preliminary Prospectus,and/or Information Memorandum (if any) that are distributed immediatelyfollowing the announcement of the Abridged Prospectus in thenewspaper, for the purpose of learning the level of interest of theOffered Shares prospective buyers and/or estimating the securities OfferPrice in accordance with Rule No. IX.A.8 Annex to the Decision No.Kep-41/PM/2000 dated 27-10-2000 concerning Preliminary Prospectusand Information Memorandum (if any) (hereinafter referred to as RuleNo. IX.A.8) and with due consideration to Rule No IX.A.2.

BPOM Refers to the abbreviation ofBadan Pengawas Obat & Makanan(National Agency of Drugs and Food Controls).

Business Day Refers to Monday to Friday, excluding national holidays determined bythe Government of the Republic of Indonesia or Normal Business Days,which as a result of certain condition are determined otherwise by theGovernment of the Republic of Indonesia.

Calendar Day Refers to every day in 1 (one) year based on the Gregorian Calendar,

with no exception, including Saturday, Sunday and national holidays thatmay be determined by the Government at any time.

Capital Market Law Refers to the Law of Republic of Indonesia No. 8 year 1995 regardingCapital Market, which was announced in the Supplemental StateGazette of the Republic of Indonesia, No. 3608, State Gazette of theRepublic of Indonesia No. 64 year 1995, and its implementingregulations.

Changes/Amendments of Agreement

Refers to amendments and/or additions and/or renewals of theagreements that form an integral and inseparable part of the agreement.

Collective Depository Refers to depository services of securities owned jointly by more thanone party, whose interests are represented by the Kustodian SentralEfek Indonesia.

Company Law Refers to the Law of the Republic of Indonesia No. 40 year 2004regarding Limited Liability Companies as announced in theSupplemental State Gazette of the Republic of Indonesia No. 4756,State Gazette of the Republic of Indonesia No. 106 year 2007, and itsimplementing regulations.


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Compulsory Registration ofCompanies Law

Refers to Law of the Republic of Indonesia No. 3 year 1983 regardingCompulsory Registration of Companies as announced in theSupplementary State Gazette No. 3214, State Gazette of the Republicof Indonesia No 7 year 1982, and its implementing regulations.

CPOB Refers to the abbreviation ofCara Pembuatan Obat yang Baikor GoodManufacturing Practices.

CPOTB Refers to the abbreviation ofCara Pembuatan Obat Tradisional yangBaikor Good Traditional Medicine Manufacturing Practices.

CSR Refers to the abbreviation of Corporate Social Responsibility.

Custodian Bank Refers to commercial banks that are approved by Bapepam & LK(currently known as Financial Service Authority Otoritas Jasa

Keuangan (OJK))to provide safekeeping services or custody servicesas stipulated in the Capital Market Law.

Distribution Date Refers to the same date as the payment date, by no later than2 (two)Business Days from the Allotment Date, where the Offered Shares aredistributed electronically by KSEI to the Account Holders.

Effective Refers to the condition where the Registration Statement has becomeeffective as stipulated in Rule No. IX.A.2 concerning RegistrationProcedures for A Public Offering, Annex to the Decree of Chairman of

Bapepam and LK No. KEP-122/BL/2009 dated 29 May 2009 (hereinafterreferred to as Rule No. IX.A.2)

Effective Statement Refers to OJK statements which declares that the RegistrationStatement has become effective: (i) on the 45th (forty-fifth) day after thedate that the complete Registration Statements is received by OJK or (ii)on the 45th (forty-fifth) day after the Company submits the last Amendment to the Registration Statement to OJK, or (iii) other datebased on the Effective Statement from Chairman of OJK which declaresthere are no more amendments and/or additional information required,as set forth in the Rule No. IX.A.2, therefore entitling the Company,through the Underwriters, to offer and sell the Offered Shares inaccordance with the prevailing laws and regulations.

ESA Refers to the abbreviation of Employee Stock Allocation

Exchange Day Refers to the days where the Stock Exchange performs securitiestrading activities, i.e., from Monday to Friday, unless the respective daysare national holidays or announced as holidays by the Stock Exchange.

Founding shareholder Refers to Ny. Desy Sulistio, Irwan Hidayat, Sofyan Hidayat, Johan

Hidayat, Ny. Sandra Linata Hidajat and David Hidayat


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GMS Refers to the abbreviation of General Meeting of Shareholders

Government Refers to the Government of the Republic of Indonesia.

IDX Refers to the abbreviation of PT Bursa Efek Indonesia, a limited liabilitycompany established by virtue of the Indonesian law and regulationsand domiciled in Jakarta, (or the replacement or beneficiary to its rights),which is a stock exchange as defined in the Capital Market Law, wherethe Companys shares are listed.

Initial Public Offering Refers to the Initial Offering of Offered Shares to the Public as referredto in the Capital Market Law and its implementing regulations and otherrelevant provisions and the provisions set forth in the Agreement.

IPO Account Refers to the account registered under the Joint Lead Underwriterss

name to receive the proceeds from the investors.

Joint Lead Underwriters Refers to the parties to a contract / agreement with the Company for theInitial Public Offering for the benefit of the Company, guarantee the saleof the Offered Shares and distribute the IPO proceeds to the Companyby the Underwriters pursuant to each Underwriting Portion, with respectto the terms and condition of the Underwriting Agreement.

KSEI Refers to the abbreviation of PT Kustodian Sentral Efek Indonesia,domiciled in Jakarta, which is the Securities Depository and Settlement

Institution as defined by the laws and regulations relating to the CapitalMarket.

Listing Date Refers to the date the Offered Shares are listed for trading at the StockExchange, to be effected by no later than 1 (one) Business Dayfollowing the Distribution Date, the exact date of which will bedetermined in the Amendments of Agreement.

Ministry of Health Refers to the Ministry of Health of the Republic of Indonesia (previouslyreferred to as Department of Health)

MoJ Refers to the abbreviation of the Ministry of Justice and Human Rights ofthe Republic of Indonesia

New Shares Refers to ordinary registered shares at a nominal value of Rp100 (onehundred Rupiah) that will be issued from the Companys portfolio at amaximum amount of 1,500,000,000 (one billion five hundred million)shares to be offered and sold to Public in the Public Offering and will belisted on the Stock Exchange.


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Offer Price Refers to the price of each Offered Shares through Initial Public Offering,which nominal will be defined based on agreement between theCompany and the Joint Lead Underwriters, which will be incorporated inthe Amendment to Underwriting Agreement.

Offered Shares Refers to New Shares offered and sold to Public by the Underwritersthrough the Public Offering, which will be listed on the Stock Exchangeon the Listing Date.

Offering Period Refers to the duration for the public to submit the Offered Sharessubscriptions as regulated in the SSF and Chapter XX regarding Termsof Shares Subscriptions.

OJK Refers to the abbvreviation ofOtoritas Jasa Keuangan or FinancialServices Authority, an independent institution that is free from any

intervention, which has the function, responsibilities and authority toregulate, supervise, examine and investigate as stipulated in Law No. 21Tahun 2011 dated 22-11-2011 (twenty-two November two thousandeleven) regarding Financial Services Authority (Law No. 21, 2011).Commencing on 31 December 2012 (thirty-one December two thousandand twelve), the functions, responsibilities and authority to regulate andsupervise the financial services activity in the Capital Market, weretransferred from the Minister of Finance and Bapepam and LK to OJK, orthe replacement and beneficiary of its rights and obligations, inconformity with Article 55 Law No. 21, 2011.

Preliminary Prospectus Refers to the written document prepared by the Company and the JointLead Underwriters with regard to the Public Offering and contains allinformation in the Prospectus submitted to OJK as part of theRegistration Statement, except for the information regarding the numberof Offered Shares, Offer Price of the Offered Share, underwriting orother matters related to offer requirement that cannot yet be determined,in accordance with Rule No. IX.A.8 and with due consideration to RuleNo. IX.A.2.

Primary Market Refers to the offering and sale of the Companys Offered Shares to thepublic during the Offering Period prior to the listing of such shares in theStock Exchange.

Prospectus Refers to the final written document prepared by the Company and theJoint Lead Underwriters with regard to the Public Offering and containsall relevant and essential information on the Company and the OfferedShares, which form and content are in accordance with BapepamRegulation No. IX.C.2, Annex to the Decree of Chairman of Bapepamand LK Kep-51/PM/1996 dated 17 January 1996

prospectus sidomuncul 2013

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