South East Asia’s First Rubber Industrial HubV8

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South East Asia’s First Rubber Industrial Hub

Kota Putra Rubber City

w w w. k o t a p u t r a r u b b e r c i t y . c o m . m y

CONTENT• Location of Kedah

• Kedah Connectivity & Strategic Location

• KPRC Overview & Mardec

• Mardec’s Asian Presence

• Rationale in Targeting Chinese Investors

into KPRC

• Salient Features of Kota Putra Rubber City

• Existing Infrastructure & Facilities

• Potential Industries

• KPRC Masterplan

• KPRC Overall Zoning

• Key Design Parameters

• Conclusion

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Langkawi

Hat Yai

Penang Island KEDAH

KOTA PUTRA

Singapore

Thailand

Indonesia

Kuala lumpur

MALAYSIA

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Kedah is located on the northwest cornerof Peninsular Malaysia, bordered byThailand in the north, by the Straits ofMalacca on the west, and by Penang andPerak in the south. Kedah hastransformed its economy from anagriculture-based to an industrial-basedwith concentration on hi-tech,hydrocarbon, manufacturing, tourism andservices.

Kedah is an attractive investment destination:

• Common border / international boundary with Songkhla and Yala provinces of Thailand.

• Strategically located at the entrance to the Straits of Malacca.

• Centre of the Indonesia, Malaysia, Thailand Growth Triangle (IMT-GT).

LOCATION OF KEDAH

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KEDAH STATE CONNECTIVITYROAD AND RAIL

AIRPORT AND PORT

Kedah is well connected by road and rail.

The NORTH-SOUTH EXPRESSWAY, Peninsular Malaysia’s main transportation artery, traverse Kedah in the north-south direction.

The ELECTRIFIED DOUBLE TRACK RAILWAY runs through the state of Kedah. It connects Padang Besar in Perlis to Ipoh in Perak and eventually to the Klang Valley.

AIRPORTS in the northern region:

• Sultan Abdul Halim Airport domestic airport in Alor Setar

• Penang International Airport about 2 hours drive from Alor Setar

• Langkawi International Airport venue for the Langkawi International Maritime and Aerospace Exhibition (LIMA)

PENANG PORT

RAILWAY LINE

NORTH SOUTHHIGHWAY

AIRPORT

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PENANGINTERNATIONAL

AIRPORT

LANGKAWIINTERNATIONAL

AIRPORT

RAILWAY LINE

TEKIH HIGHWAY

NORTH SOUTHHIGHWAY

BORDER GATEWAYS

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ALORSETAR

AIRPORT

PENANGPORT

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STRATEGIC LOCATIONOF KPRC

• Borders Ban Pra-Korb in Songkhla Province, Thailand. • 62 km Northeast of Alor Setar/Alor Setar Airport/Railway station• 155 km North of Penang.• 89 km South of Hat Yai. integrated border town.

• Surrounds Kota Putra Customs Immigration and Quarantine (CIQ) Complex.• 2,450 acres to be developed into a resource based integrated border town.• Proposed land bridge project connecting Penang Port & Songkla Port

81. Songkla2. Hat Yai3. Kota Perdana4. Kota Putra6. Langkawi Island7. Penang Island8. Alor Setar

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KOTA PUTRARUBBER CITY OVERVIEW

Objective• To develop KPRC as an integrated Rubber City with modern facilities• To offer a unique eco friendly township development with a rubber research facility, with ample supporting amenities to serve a working – living population.

Why Kota Putra Rubber City (KPRC)?• KPRC is a strategic project to rejuvenate and elevate Malaysia’s competitiveness within the global rubber industry• KPRC acts as catalyst in accelerating new economic growth centers for the rubber industry• KPRC acts as a conduit to the MOU signed between the Governments of Malaysia a Thailand in cross border economic collaboration with its strategic location between both nations and the rubber belt.• A private led initiative to complement the Goverment’s proposed Rubber City @ Bukit Ketapang.

Mardec Berhad is a world renowned player with 51 years of experience in rubber processing, trading and manufacturing value-added rubber & polymer products. We are global in our outlook and employ the most up-todate technology to ensure our products meet international specifications from buyers all over the world.

WHY MARDEC

Why is Mardec and KPRC advantageous and attractive? - With Mardec’s years of experience it would be the ideal partner to co-develop KPRC - Mardec’s expertise in midstream and downstream would add value in dominating market share - The advent of TPPA will make us an ideal partner for the Chinese - Abundant labor and rubber supply across the rubber belt - Surrounded by rubber industrial players - R&D and One stop testing facility

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2A

2B

VIETNAM

INDONESIA

KPRCMARDEC R.K. LATEX PVT. LTD.Processing of Latex Concentrate

MARDEC YALA CO. LTDProcessing of Latex Concentrate

MARDEC SAIGON RUBBER CO. LTDProcessing of Latex Concentrate,

PT. MARDEC MUSI LESTARIProcessing of Standard Indonesia Rubber

PT. MARDEC SIGER WAY KANANProcessing of Standard Indonesia Rubber

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2A

2B

Malaysia NR Processing Centres

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Our operations span over 5 countries across Asia

MPSB BalingProduce of rubber:•SMR 10 & 20•MARUB 10CV & 20CVRated Capacity:30,000 tonnes/year

MPSB Kuala PilahProduce of rubber:•SMR 10 & 20Rated Capacity:18,000 tonnes/year

MPSB BotaProduce of rubber:•SMR 10 & 20•MARUB 10CV & 20CVRated Capacity30,000 tonnes/year

MIL Ulu AraProduce of rubber:•Latex Concentrate•PV Latex•Specialty RubberRated Capacity:840 tonnes/year

MIL TapahProduce of rubber:•Latex Concentrate•PV Latex•Specialty RubberRated Capacity:12,000 tonnes/year

MPSB Kuala BerangProduce of rubber:•SME 10 & 20Rated Capacity:30,000 tonnes/year

MPSB MentakabProduce of rubber:•SMR 10, 20 & CRRated Capacity:42,000 tonnes/year

TerengganuPerak

Kedah

Pahang

Negeri Sembilan

Malaysia NR Processing Centres

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Rationale in Targeting Chinese Investors into KPRC

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China has a vested interest to protect their rubber industry.China is the largest consumer of natural rubber and yet the grow no rubber. China’s uncertainties on natural rubber production could be bridged by their joint investment in KPRC to meet their all time high rubber consumption of 4,760 kt representing 39.1% of the world’s total consumption.

China wants to be the world trading hub for rubber By exporting 44.451 Million tyres in 2015, China is gearing to become a global market hub for rubber commodities (Malaysia Rubber Board, 2016).

China and Malysia can jointly control the midstream industry and lock up long term supply as the rubber prices are all time low. With China’s rising consumption of natural rubber (39.1%), China and Malaysia could lockup on Partnership focusing on Midstream to bridge the Gap on Supply & Demand.

Transfer Rubber industry form China to Malaysia KPRC gives platform for these top player in China to expand in very strategic location where it can be catalyst for development of midstream and downstream rubber industry growth.

Control & DominanceComplete control of supply chain across natural rubber industry in KPRC will help to yield high quality finished goods

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In line with China’s One Belt One Road Initiative, which refers to the “Silk Road Economic Belt” and the “21st Century Maritime Silk Road”, Kota Putra Rubber City would be an ideal investment for China’s development initiative.

Among the agreements and deals that have been made under the One Belt One Road Initiative (ASEAN Region) include:

• The setting up of the Asian Infrastructure Investment Bank• Infrastructure projects include the Jakarta-Bandung Railway in Indonesia; the Kunming- Vientiane Railway & the Kunming-Bangkok Railway.

One Belt One Road Initiative

TPPATPPA

Primary Effects of TPPA

1. Reduction of Tariff Measures2. Reduction of Non Tariff Measures 3. Increased market access

Key Effects of Malaysia’s participation in the TPPA are:

1. Sectors contributing over 20% of Malaysia’s GDP in 2014 are expected to higher output growth2. Efficient export oriented firms will benefit greater market access, particularly in high value manufacturing of:

• Textiles• Automotive components (especially

rubber based)• Electrics and Electronics• Plastics • Woods

Industries of suited for Kota Putra Rubber City

Based on the above projects, we see synergy with the development of Kota Putra Rubber City that would be a nucleus for the rubber industry between China, Malaysia,

Thailand & Indonesia.

Comparative Advantage to Chinese Firms

1. Chinese firms can set up manufacturing facilities in KPRC to capitalize on TPPA. 2. Combine this advantage with existing incentives offered by the Malaysian Government.3. Provides reduction in TM and NTMs to large markets in Japan, Mexico, United States and

Canada.

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Fiscal incentives Non-Fiscal

A. Manufacturers

B. Eco-System Industries – (Infrastructure providers)

Tax Incentives (Corporate)i. Pioneer status or investment tax allowanceii. Stamp duty exemptioniii. Deduction from pre-commencement expenses

Note: Investor can also tap on other existing non-tax incentives such as the Technology Acquisition Fund.

Tax incentives (Corporate)i. Pioneer status or investment tax allowanceii. Stamp duty exemptioniii. Deduction from pre- commencement expensesiv. Real Property Gains Tax exemptions

Non-Tax Incentivesi. Grants for R&Dii. Flexibility to recruit foreign knowledge workersiii. Flexibility from foreign exchange administrative rules set forth by Bank Negara Malaysiaiv. Financial support for capital- intensive projects

C. Eco system industries excluding infrastructure – Upstream and midstream suppliers, Education & training providers, auxiliary service providersTax incentives (Corporate)i. Pioneer status or investment tax allowanceii. Stamp duty exemptioniii. Deduction from pre-commencement expenses

Note: Educational institutes located outside the Rubber City may apply grants / financial support for specific projects supporting the Rubber City on a case to case basis.

Non-Tax Incentivesi. Grants for R&Dii. Flexibility to recruit foreign knowledge workersiii. Flexibility from foreign exchange administrative rules set by Bank Negaraiv. Financial support for capital intensive projects

•100% of income up to 5+5+5 years or 100% ITA for 10 years•Stamp duty exemption, withholding tax exemption, import duty exemption of raw materials and machinery

Tax exemptions

Tax incentives provided

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Salient Features of Kota Putra Rubber City

1. Power, water, sewer & telecommunication/data lines to all plots

2. Decent road infrastructure throughout the city for ease in logistics

3. Hospital, Police Station, Fire Station, Power Substation and a Waste Management Area to satisfy all infrastructure & security needs

4. Police Station & Army Border Camp within vicinity of city to ensure optimum security

5. State of the art R&D Centre & Incubator for entrepreneurs operating within the city

6. Free Trade Zone & Special Economic Zone status for ease in conducting business ower, water, sewer & telecommunication/data lines to all plots

7. Ample parking facilities with beautiful landscaping features

8. Several public eateries & washrooms throughout the city

9. Modern retail entities within city to provide multiple services

10. Bus terminal to provide transport services from nearby towns & cities to Kota Putra Rubber City

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Kota Putra Rubber City Infrastructure

Security

Telecommunications

Electricity

Water Supply

Overall est. water•Demand @ 16.3 MGpd•Low Zone Tank @ 7.02 MGpd•High zone tank @ 9.22 MGpd•Low zone serving platforms 100 – 130 m ODL•High zone serving platforms 130 – 150 m ODL

Sourch : Tenaga Nasional Berhad•Main Supply (275/132V)•Features: Reliable, stable, uninterruptible, near constant quality•100% underground cable networks•Closed loop operations

•Police station•Fire station•Army Border camp

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The Federal Government had constructed and completed the main infrastructure and facilities in Kota Putra.

EXISTING INFRASTRUCTURE

AND FACILITIES

The Kota Putra – Ban Prakorb Gateway

Government Quarters, Police Station, Clinic

Water Treatment Plant/Sewerage Treatment Plant

Existing Roads

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KPRC TargetIndustries

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POTENTIAL INDUSTRIES

Cutting Edge Technology

Traditional Technology

Green technology Automotive

Nano technology Marine

IT Technology

Railways / MRT

Biotechnology

Electrical & Electronics

Building & Construction

Mining and Industrial

Defence

Mobile technology

Infrastructure & Roads

Healthcare technology

Advance 3D printing technology

Oil & Gas

Robotics technology

Aviation

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POTENTIAL PRODUCTS

Consumer Products• Household Items• Rubber Fins

Extruded RubberProducts• Infrastructure• Food• Medical Industry• General Applications

Moulded Rubber Products• Automotive Industry• General Application• Defence• Oil & Gas• Plastic Products• Hoses• Utilities

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KPRC MASTERPLAN

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Industry 487.78ac

PBT 26.11ac

Hill Park 143.59ac

Other Infra 534.82ac

TOTAL 2618.13ac

Trading 567.99ac

Housing 857.84ac

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KPRC ZONING

HILLPARK

R&D Center

Tyre Factory100 acres

Mardec SuperFactory 57acresMidstream rubber factory

Mardec Polimer Sdn Bhd45 acresDownstream rubber

Industry 487.78ac

PBT 26.11ac

Hill Park 143.59ac

Other Infra 534.82ac

Trading 567.99ac

Housing 857.84ac

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KEYDESIGN PARAMETERS6

A. Development Period : 15 yearsB. Phased Development : 4 NosC. Infrastructure Development : 2 NosD. Water : Overall est. water Demand @ 16.3 MGpd Low Zone Tank @ 7.02 MGpd High zone tank @ 9.22 MGpd Low zone serving platforms 100 – 130 m ODL High zone serving platforms 130 – 150 m ODL

E. Sewerage : 240,000 PE with 1 centralized STPF. Electricity : 80 mW MDL 1 No. Transmission Main Intake S/S 4 No. Main Distribution S/SG. Telecommunication : To be provided by various telcos

Land Details

• Land Owner - Kota Putra Rubber City Development Sdn Bhd Level 9, Menara HLA No,3, Jalan Kia Peng 50450 Kuala Lumpur

• Area - 2,448.69 acres (990.95 hectares)• Exising - Rubber Tree• Land form - Ranges from 95 to 220m

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KPRCCONCLUSION 7

This initiative is a collaboration between the public & private rubber industry players which will result in the creation of a catalyst that will revive the global rubber industry.

It is our hope that this collaboration with China will take Malaysia from its current status of a just a rubber commodity exporter to a leading expert in providing rubber solutions in all fields.

www.kotaputrarubbercity.com.my

South East Asia’s First Rubber Industrial Hub

DISCLAIMER

This brochure is not intended to form the basis of any investment decision with respect to Tradewinds Plantation Berhad (TPB). Neither does this brochure nor anything contained herein shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This brochure is solely based upon Information of TPB. No representation or warranty, express or implied, is or will be made by TPB in relation to, and no responsibility or liability is or will be accepted by TPB as to the accuracy and completeness of, the Information made available, and any liability therefore is expressly disclaimed. This brochure contains “forward-looking statements”. Forward-looking statements by their nature involve known and unknown risks, uncertainties and other factors that are in many cases beyond TPB’s control. Although TPB believes that the expectations of its management as reflected by such forward-looking statements are reasonable based on information currently available to it, no assurances can be given that such expectations will prove to have been correct. Accordingly, you are cautioned not to place undue reliance on such forward-looking statements. In any event, these statements speak only as of their dates, and TPB undertakes no obligation to update or revise any of them, whether as a result of new information, future events or otherwise.

This brochure and its contents are strictly confidential and must not be copied, reproduced, distributed, summarized, disclosed referred or passed on to others at any time without the prior written consent of TPB.