INVESTMENT COMMITTEE MEMORANDUM

Katibung Integrated Industrial Estate

Lampung Selatan, Indonesia

2. INVESTMENT HIGHLIGHTS

• National-scale industrial platform in an underserved region

• Government-aligned (RDTR, RPJMN/RPJMD, KPBU, PSN-oriented)

• Early entry land banking advantage

• Competitive land pricing relative to Java

• Clear legal structure for foreign investors

• Multiple exit pathways

3. PROJECT OVERVIEW

| Item | Description |

| ------------------------ | ------------------------------- |

| Location | Katibung Lampung |

| Land Area | ±3,000 Ha |

| Development | Phased (Phase 1–3) |

| Asset Type |Integrated Industrial |

| Zoning |Industrial (RDTR aligned) |

8. DEVELOPMENT & MASTER PLAN

• Multi-cluster industrial zoning

• Logistics and export-oriented focus

• Utilities and estate services integrated

• Phased capex deployment

1. EXECUTIVE SUMMARY

The Katibung Integrated Industrial Estate (“Project”) represents an early-stage, large-scale industrial estate development opportunity in Sumatra, Indonesia, aligned with national industrialization and logistics strategies.

The Project comprises approximately 3,000 hectares of land planned for phased industrial development under a Joint Venture and KPBU (PPP) framework, with participation from government-linked entities and a local sponsor.

The investment offers attractive risk-adjusted returns, supported by low land acquisition cost, regulatory alignment, infrastructure-led value uplift, and strong demand outlook for industrial land outside Java.

Target Equity IRR: 18–22%+
Foreign Ownership: Up to 49%
Structure: Offshore HoldCo → Onshore SPV (Indonesia)

4. STRATEGIC RATIONALE

Indonesia is actively promoting industrial relocation from Java to outer islands to address congestion, logistics inefficiencies, and land scarcity.

Sumatra, particularly South Lampung, benefits from:

• Strategic connectivity

• Lower land and labor costs

• Government-backed industrial expansion

Katibung is positioned as a first-mover industrial platform in the region.

5. LOCATION & CONNECTIVITY

• Proximity to Trans-Sumatra corridor

• Access to ports and logistics hubs

• Integration with national transport infrastructure

• Competitive alternative to Java-based industrial estates

6. LAND STATUS & LEGAL

• ~90% private land (Hak Milik) targeted for acquisition

• ~10% public/government facilities

• Acquisition executed phased to mitigate risk

• Land to be held by Indonesian SPV (FDI compliant)

No material disputes identified at preliminary stage; full legal DD ongoing.

7. REGULATORY & GOVERNMENT SUPPORT

• RDTR zoning for industrial use

• KPBU framework provides regulatory stability

• Government facilitation for licensing and infrastructure

• Alignment with provincial and national development plans

9. BUSINESS MODEL

Primary revenue streams:

• Industrial land sales

• Long-term industrial leases

• Utilities and estate management fees

• Ancillary commercial developments

10. FINANCIAL SUMMARY (INDICATIVE)

| Metric | Estimate |

| ------------------------------ | ------------------------- |

| Total Project Cost |IDR 20–22 Trillion |

| Equity Portion | 30–40% |

| Debt Portion | 50–70% |

| Project IRR (Unlevered)| 15–18% |

| Equity IRR (Levered) | 18–22%+ |

Value creation driven by:

• Zoning uplift

• Infrastructure completion

• Absorption velocity

11. SENSITIVITY OVERVIEW

Key sensitivities:

• Land acquisition cost

• Selling price per m²

• Sales absorption rate

• FX movement (IDR/USD)

Downside scenarios remain within acceptable return thresholds due to low entry land cost and phased execution.

12. INVESTMENT STRUCTURE

• Two-tier structure:

  • Offshore Holding Company

  • Indonesian Operating SPV

• JV combined with KPBU framework

• Foreign ownership capped at 49%, with contractual control rights

14. ESG & COMPLIANCE

• Compliance with Indonesian environmental regulations

• AMDAL required and planned

• ESG-aligned industrial estate concept

• Local employment and community impact

15. RISK ASSESSMENT & MITIGATION

| Risk | Mitigation |

| --------------------- ------ | --------------------------- |

| Land acquisition |Phased acquisition |

| Regulatory | KPBU + GovCo |

| Market absorption | Anchor tenants |

| FX |USD-linked revenue|

| Political |Treaty protection & PRI |

16. EXIT STRATEGY

• Trade sale to global industrial operator

• Partial divestment post Phase 1–2

• IPO or infrastructure trust

• Contractual exit rights (drag/tag)

18. KEY CONDITIONS

• Completion of legal, technical, financial DD

• Confirmation of zoning and permits

• Finalization of JV & SHA

• Financial close for Phase 1

19. IC RECOMMENDATION

Proceed to:

• Full due diligence

• Negotiation of definitive agreements

• Structuring of equity and debt financing

The Project presents a compelling, policy-aligned industrial infrastructure investment with attractive risk-adjusted returns and strategic optionality.

13. GOVERNANCE & CONTROL

Foreign investor protections include:

• Board representation

• Reserved matters

• Supermajority voting

• Information and audit rights

• Change of control protections

17. INVESTMENT ASK

• Equity participation (USD)

• Minority stake with enhanced control

• Long-term horizon (5–10 years)

• Target close post-DD completion