Jeffrey Bahar, Group Deputy CEO of Spire Research and Consulting, was speaking about Private Port for Non-Containerized Cargo: Indonesia's Hidden Gem for Investors at 6th Southeast Asia Port Expansion Summit in Kuala Lumpur, Malaysia.

1. Indonesia’s Hidden Gem for Investor:
Non-Containerized Cargo Private Port
For 6th Southeast Asia Port Expansion
Summit
Kuala Lumpur, Malaysia, July 11th, 2019

2. Why Non-containerized Cargo in Indonesia is an attractive business?
2
2014 2015 2016 2017 2018F 2019F 2020F 2021F 2022F 2023F 2024F
Non-Containerized Volume Projection
(in Million tons)
1,228
912 984 1,116 1,235 1,366 1,512 1,673 1,851 2,048 2,265
Source: Spire Analysis, Indonesian Central Agency on Statistics and Internal Data
Non-containerized cargo volume is predicted to grow 11% to 2024 and 80% of total volume is through private-owned ports.
*The projection is assuming that economic structure and export-import composition and
Indonesia’s industry does not significantly change.
Private
State-owned
• Positive economic situation
• Coal and CPO as Indonesia’s main resources
• No restriction for high volume of export cargo
• Government plan to 2030: 1.6 billion ton
PT Wilmar Nabati Indonesia
PT Arutmin Indonesia9
PT Kideco Jaya Agung8
PT Berau Coal7
Marunda Center Terminal6
PT Adaro Indonesia5
Pelindo I4
Pelindo IV3
PT Kaltim Prima Coal Tanjung Bara2
Pelindo III1
10
Top 10 Entities with Largest Throughput
(Non-Containerized)
• Declining economic condition
• Limited export volume for raw minerals
• Declining coal demand from China

3. 3 Source: Ministry of Transportation and Spire Internal Data
Based on its ownership
Definition
Ports in Indonesia that is owned by the
government.
There are four entities placed under the
supervision of the government’s Transportation
Ministry that managed four operational areas
(Pelindo I, Pelindo II, Pelindo III and Pelindo IV).
The operational areas often stated as main port in
Indonesia.
Ports that are managed by local
governments, regional owned
port operators and private sector
companies.
Business entity whose business activities
may includes all terminal commercialization
as well as maximization of other port
facilities.
All state-owned ports are commercial but there
are limited number of private ports that are
commercial port.
A dedicated port for transporting of
specific commodities.
Owned by private entity which usually serve
their own commodities in accordance with the
main business. Primarily located in the owner’s
working area.
Indonesia’s Private and State-Owned Port (2017)
Based on license
1519
Ports
and Entities
984
Bulking Terminals
101
Ports
State-owned Port Private Port
Commercial Port
(Badan Usaha Pelabuhan/BUP)
227
Entities
Special Purpose Terminal
(Terminal Khusus Untuk Kepentingan Sendiri/TUKS)

4. From 984 non-containerized cargo terminals, 5
main commodities are discovered.
4 Source: Spire Analysis, Internal Data
Main Players and Leading Commodities
PT Kaltim Prima Coal Tanjung
Bara
1
2
3
4
5
PT Adaro Indonesia
Marunda Center Terminal
PT Berau Coal
PT Kideco Jaya Agung
Market Share Non-Containerized Cargo Based on Volume
Throughput 2017
Others
57%
Top 5 Private
Companies
with Largest Volume
Throughput of
Non-Containerized
Cargo
From 984 special purpose terminals, 4 main
commodities are discovered.
Distribution of Commodities for Special Purpose Terminal
39.00% 26.56%
18.97%
9.03%
6.50%
CPO
Coal
Others
Oil and Gas
Non-metallic
Minerals and Sand
Private
State-owned
Kideco
3%
Pelindo III
8%
Kaltim Prima
6%
Pelindo IV
5%
Pelindo I
5%
Adaro
5%
MCT
3%
Berau Coal
3%
Wilmar
Nabati
3%
Arutmin
3%
1 2 53 4
6 7 108 9

5. 5 Source: Spire Analysis, Internal Data
Market Drivers on Indonesia’s Port
Annual growth of
5% for 15
years ahead. Strong factors driving bright
market opportunities in
Indonesia’s port industry.
Greater opportunity in port
business specifically for non-
containerized cargo.
Guaranteed and consistency in
port business licensing to
address private sector’s legal
concerns.
ImplicationStrict regulation
to ensure
stakeholder
responsibility.
Infrastructure
development
that driven port
activities.
Coal and CPO
opportunity in
international
trading.
Economic Condition Regulation
Infrastructure Majority of Cargo Trading

6. 6 Source: Spire Analysis, Internal Data
Market Demand
Market Supply
Indonesia’s port business industry on non-containerized private port is expected to grow, accommodated
by two leading trading commodities which are coal and CPO.
Market Outlook of Major Commodity Cargo
Increasing of dry bulk
trading globally by 3%.
Coal, the second largest
global trading.
Indonesia as main exporters
of global coal
(reserve: 32 billion ton)
Coal mining and its
distributions is held by
private entity.
Distinct opportunity for
other resources.
80% of global trade held by
non-containerized cargo
terminals.
Multipurpose terminal
as main terminal.
Private entities of Coal and
CPO will remain as the
largest throughput.

7. 7 Source: Spire Analysis, Internal Data
No Area
No.
TUK
S
No.
BUP
1 Bali 5 1
2
Bangka Belitung
Island
39 -
3 Banten 42 3
4 Bengkulu 5 1
5 DKI Jakarta 12 -
6 Gorontalo 4 1
7 Jambi 34 4
8 West Java 8 5
9 Riau 25 2
10 Central Java 12 5
11 East Java 36 7
12 Tuban District 2 -
13 East Kalimantan 217 11
14 West Kalimantan 41 3
15 South Kalimantan 84 16
16 Central Kalimantan 61 3
17 North Kalimantan 18 -
18 Riau Island 56 4
No Area
No.
TUK
S
No.
BUP
19 Lampung 9 1
20 Moluccas 4 -
21 North Moluccas 18 -
22
Nanggroe Aceh
Darussalam
11 -
23 West Nusa Tenggara 6 -
24 East Nusa Tenggara 9 -
25 Papua 21 -
26 West Papua 11 1
TUKS: Special Purpose Terminal
BUP: Commercial Port
22
34
9
32
21
7
4
18
2
33
19 5
3 8
10
12
11
1 23 24
20
26
25
316
29
30
28
27
17
13
15
16
14
Private Ports and Terminals in Indonesia for Non-Containerized Cargo
Top 5 Areas
No Area
No.
TUK
S
No.
BUP
27 West Sulawesi 4 -
28 South Sulawesi 11 1
29 Central Sulawesi 45 -
30 South East Sulawesi 39 -
31 North Sulawesi 17 -
32 West Sumatera 4 -
33 South Sumatera 42 -
34 North Sumatera 15 2
35 Unidentified 17 156

8. 8 Source: Spire Analysis, Internal Data
Total Volume
(2017)
Main
Commodities
Other
Commodities
Number of
Private Port
(TUKS and BUP)
Market Share
South
Kalimantan
East
Kalimantan
North
Kalimantan
South
Sumatera
Riau Island
298 million
ton
Coal
Cement
Wood,
Crumb
Rubber and
Kernel
100
29.8%
285
million ton
Coal
CPO
Non-metallic
minerals,
Petrochemical
and Wood
228
28.4%
34
million ton
Coal
CPO
Oil and Gas,
Processed
Wood, Fishery
18
3.4%
25
million ton
Coal
CPO
Fertilizer
Wood, Kernel
and Oil and Gas
42
2.5%
19
million ton
Coal
CPO
Cement
Building Material, Non-metallic
minerals, Timber, Coconut, Palm
Oil, Processed Metal, Oil and Gas,
Other Mineral, Fishery,
Petrochemical and lead
60
1.9%
Top 5 Province with the Largest Volume for Non-Containerized
1 2 3 4 5

9. 9 Source: Indonesian Central Agency on Statistics and Spire Analysis
Coal Reserve
12.2 Billion ton
Adequate for more than 50 years ahead
2014 2015 2016 2017
Production Export Realization
• 80% of production is exported
• Decreasing volume of production is driven by
declining demand of international trade
(environmental issue)
• 60% of TUKS is handling coal commodity.
1. South Kalimantan
Main Commodity
Volume Coal Production
and Export Realization (in Million ton)
Hinterland
171.2
140 147.4
127
151.7
126
148
130
*of total volume in South Kalimantan
State-owned Port
Pelindo III – Banjarmasin :
focus on containerized
Pelindo III – Kotabaru: focus
on non-containerized (i.e.
coal and wood)
Rank Entities Commodity
1 PT Arutmin
Indonesia
Coal
2 PT Hasnur Jaya
Utama
Coal
3 PT Johnlin Group Coal
4 PT Berkat Hanjuang
Jaya
Coal
5 PT Binuang Jaya
Mulia
Coal
Main Competition
Top 5 Special Purpose Terminal
Main Players for Private Port
Special Purpose Terminal (TUKS)
64 for Coal
Market
Share*
• Has 2 TUKS in
Kalimantan (South and
Central)
• In 2014 TUKS in Central
Kalimantan reaching
highest throughput, 14
million ton
• Concession area: 59.261
hectares
• Has 5 mines, all located in
South Kalimantan: Satui,
Senakin, Batulicin, Kintap
• Throughput in 2017
reaching 27 million ton
7.41%
2.19%
Commercial Port (BUP)
2 main Ports
PT Pelabuhan Swangi Indah 0.91%
0.16%
Market
Share*

10. 10 Source: Spire Analysis, Internal Data
Challenges for Private Port
Licenses
Capital Sources
Profit Margin
Strict regulation for
business licensing.
Lack of capital
financing from
private sector.
Maximum profit margin
as regulated from PM
No. 95/2015 for port
services is 25%.
The port businesses would
require adequate capital
investment and sometimes
unforeseen operational expenses.
Foreign or strong private
investors would be in better
position to become the new
shareholders.
Implications
With substantial analysis and planning, business in transportation businesses would receive full
support from the government.
GOVERNMENT FOCUS ON INFRASTRUCTURE

11. THANK
YOU
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