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Indorama Polymers “IRP” Q1, 2006 Analyst Meeting 15 May 2006 The Stock Exchange of Thailand

Indorama Polymers “IRP” Q1, 2006 Analyst Meeting 15 May 2006 The Stock Exchange of Thailand.

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Indorama Polymers “IRP” Q1, 2006 Analyst Meeting 15 May 2006 The Stock Exchange of Thailand

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  1. Indorama Polymers “IRP”Q1, 2006 Analyst Meeting15 May 2006The Stock Exchange of Thailand DISCLAIMER: This presentation does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any IRP Shares. Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser. For the convenience of the interested investors the management is presenting the financial data in US Dollar also. However, the translation method does not confirm with GAAP and is based on the method developed by the management which will be followed consistently in future.

  2. Fundamentals Q1, 2006 Financial Update Projects in Progress Focus: Lithuania Outlook Agenda

  3. Guiding Philosophy VISION To be one of the leading global producer with key focus on people and processes thus making INDORAMA one of the most admired companies in the world MISSION Continuously upgrade quality of products and services through people involvement and world class processes to attain customer delight thus becoming a preferred supplier and institutionalise people learning as a key factor for business growth 1

  4. Major Shareholders APL Group, the main promoters holdings are held Beacon Global and Indorama Holding Note: As on March 29, 2006, book closure for annual general meeting of shareholders IRP, total issued and paid-up capital Baht 1,382 million 2

  5. Group Structure ^Indorama Polymers Public Company Limited “IRP” PET Polymers: 126,000 tpa 99.9% 100% 51% *Petform (Thailand) Limited “PTF” Preforms, Bottles and Closures Asia Pet (Thailand) Limited “APT” Amorphous PET Polymers: 110,000 tpa ^^StarPet Inc., USA “SPT” PET Polymers: 200,000 tpa 20% 60% 20% ^^^UAB Orion Global Pet, Lithuania “OPT” PET Polymers: 198,000 tpa * Joint venture with Serm Suk Pcl which holds 40% and DEG holds 9% ^ Expanded capacity in December, 2006. Now 90,000 tpa ^^ Expanded capacity in December, 2006. Now 116,000 tpa ^^^Lithuania plant commissioning expected in Mid-2006 3

  6. Production Process *0.84 PTA *0.35 Preforms Bottle Blowing CP Plant SSP Plant MEG PET Polymers Amorphous PET Closures IPA *0.02 Petform Asia Pet IRP StarPet / Orion Global Pet *Tons of Input for 1 ton of PET polymers 4

  7. IRP Capacity 4% of Global Demand in 2007 524,000 206,000 170,000 154% 21% 5

  8. Demand Growth: New Applications Carbonated Soft Drinks Water Iced Tea Energy Drinks Juices BEER Ketchup and Sauces Milk Liquor / Wine Toiletries & Cosmetics Paints Lubricating Oil Food 6

  9. PET: Demand Growth and Per Capita Global demand of 12.3 million tons, growing at 8-10% p.a. Global Source: Tecnon • Demand growing by 1 million tons per annum • World per capita consumption is 1.7 kilos per annum • Higher per capita consumption in North America (8 kilos) and West Europe (5 kilos), still growing at 7-8% per annum 7

  10. PET Polymers demand growth in all regions 14,208 13,281 12,331 11,416 Source: Tecnon 8

  11. PET: Demand distribution Source: PIRA International Source: Tecnon • CSD demand growth of 6-7% • Water demand growth of 10-12% • Others include beverages and food • Sheet include food and non-food • Beer, developing stage, high growth • potential • Convenience is the key to growth of • packaging materials • Consumers prefer usability or • occasion specific packaging • Priority for product safety and • functionality 9

  12. Cans Vs PET, New Equations • During past four years, Aluminum prices increased from 1400 to 2400 $/ton or by 71% while PET prices increased from 830 to 1,150 $/ton or by 38% • Aluminum prices are high due to energy costs and tight demand supply • In 2007,US Aluminum price will further increase when new contracts are negotiated • 360 ml bottles replacing Cans Source: Industry Data 10

  13. Global demand 12.3 million tons projected for 2006 and growth at 8-10% per annum New applications fuelling high growth rates, 2-3 times global GDP growth, i.e. energy drinks, flavored water, iced tea and others Market movements in packaging reflect preferred packaging material PET preferred over glass, PVC and other polymers Better properties than other packaging materials Consumers prefer convenience of PET for purity, light weight and resealable Beverage producers prefer PET for being cost effective Industry Attractiveness 11

  14. PET prices move in tandem with raw materials Narrow PET spreads on rising RM costs Histrorical, Wide PET spreads on lower RM costs Source: Industry prices 12

  15. Crude price increase absorbed in petrochemical chain Petrochemical prices increased Petrochemical spreads were higher on tight supply, low investments Post-SE Asian crisis in 1997-98 Additional supply in year 2005-6 result in decline in spreads PET prices move in line with raw material prices Able to pass rising costs in past 2 years Historically, PET spreads widen on lower raw material costs Reversing petrochemical cycle will be beneficial (refer slide 12) Crude impact marginal on PET spreads 13

  16. PTA: Capacity additions outstrip demand increase Source: CMAI Note: Asia includes Middle East 14

  17. MEG: Surplus Availability Source: CMAI Note: Asia includes Middle East 15

  18. Fundamentals Q1, 2006 Financial Update Projects in Progress Focus: Lithuania Outlook Agenda

  19. Surge: Profits 30% YoY (in US$) 16

  20. Financial Performance: Consolidated (’000) Note: Average Exchange Rate 38.62 39.32 17

  21. Higher sales in premium markets 19% 27% 47% 9% 66% 6% 18% 8% Note: Sales quantities are indicated by % Spread - $229/ton Spread - $232/ton 18

  22. Surge: Profits 26% YoY (in Baht) 19

  23. Post-IPO, Higher Returns to Shareholders In Baht In UScents 49% 32% *Q1 2005 and Q1, 2006 based on post-IPO issued and paid-up capital of Baht 1,382,197,870 20

  24. Key ratios (in Baht) Lower leverage On higher base of capital employed and equity 21

  25. Financial Position (Baht’ 000) Includes Baht 1,693 million (Euro 35.8 million) debt of Orion Global Pet 22

  26. Cash flow (Baht’ 000) 23

  27. Key Ratios: Comparison 24

  28. Fundamentals Q1, 2006 Financial Update Projects in Progress Focus: Lithuania Outlook Agenda

  29. Petform, Thailand Preforms & Closures Expansion and Bottling Project • Preform 4th machine and Closure 3rd machine installed and started commercial production in Q1, 2006 • In April, 2006, Bottle blowing project completed and started commercial production • Capital expenditure of Baht 248 m. upto end of Q1, 2006 balance around Baht 70 million to be capitalized in Q2, 2006 • Loan draw down of Baht 260 m. upto Q1, 2006 (Sanctioned Baht 260 m.) • Interest during construction period to be capitalized and charged to P&L from Q1, 2006 25

  30. Orion Global Pet, Lithuania PET Polymers Greenfield Project • Ongoing work at site, installation of plant & equipment, storage facility and utilities • Capital expenditure of Euro 66.8 m. upto end of Q1, 2006 • Loan draw down of Euro 35.8 m. upto end of Q1, 2006 (Sanctioned Euro 57.5 m.) • Interest during construction period to be capitalized and charged to P&L from Q3, 2006 • Commissioning in Mid-2006 30

  31. StarPet Inc., USA PET Polymers Expansion Project • Site work and railway siding work in progress • Plant and equipment supply agreements signed • First lot of plant and equipment to arrive in May, 2006 at site • Capital expenditure of around US$ 4 m. upto end of Q1, 2006 • Loan draw down US$ 1.2 m. upto end of 2005 (Sanctioned US$ 31 million) • Interest during construction period to be capitalized and charged to P&L from Q1, 2007 • Start-up of commercial operations in January, 2007 36

  32. Indorama Polymers, Thailand PET Polymers Expansion Project • Increase capacity of PET Polymers by 36,000 tpa at existing site • Supply agreements signed with plant & equipment suppliers • Proposed capital expenditure of US$ 5 million • Financing with US$ 4 million long term loans and balance from internal cash • Interest during construction period to be capitalized and charged to P&L from Q1, 2007 • Start-up of commercial operations in January, 2007 39

  33. Fundamentals Q1, 2006 Financial Update Projects in Progress Focus: Lithuania Outlook Agenda

  34. Strategically located in the gateway of EU and CIS Lithuania Lithuania, EU member and recognized as the prime transport center in the region linking the EU with the East, CIS & Russia 40

  35. Growing economy attracting FDI Source: Lithuanian Department of Statistics, www.std.lt 41

  36. Klaipeda: Free economic zone and transport hub Orion Global Pet Plant Location Klaipeda, a transport and logistics hub with a developed infrastructure 42

  37. Port of Klaipeda - the biggest container port in Baltic States and open for investments Source: Klaipeda State Seaport, www.portofklaipeda.lt • Klaipeda, a free economic zone with developed infrastructure and tax benefits • Klaipeda is a big transport hub connecting sea, land and rail routes from East to • West • Port of Klaipeda has been designated the EU's regional priority port, • linked to all major ports in EU • an ice free port • capacity of more than 30 million tons per year 43

  38. Europe Continues to be a Net Importer Source: Tecnon Demand outstrips supply, imports to continue but domestic producers at advantage over imports 44

  39. Demand outstrips Supply…Room to grow PET producers in Europe market: • IRP capacity represents 6.3% of the capacity • Total demand around 3.5 million tons and demand growth of 7-8% per annum • equivalent to around 250,000 tons per annum 45

  40. Key highlights • Economies of scale, OPT will have the largest single line plant in Europe • Low capex cost, around US$ 485 per ton compared to peers • Low Conversion cost, comparable to Asia of around US$ 80 per ton considering low cost base, a developing economy, and required manpower around 110 persons • Availability of key raw materials, PTA & MEG, available in Europe and suppliers in Asia and USA have manufacturing facility in Europe • Demand exceeds supply, marketing will be concentrated in the markets of Greater Europe including CIS & Russia which are supply deficit regions. OPT will substitute imports and capture growing demand through sales to: • Global Convertors, customers of the Group in Asia and USA • Global Brand Beverages, customers of the Group in Asia and USA • Regional Convertors 46

  41. Fundamentals Q1, 2006 Financial Update Projects in Progress Focus: Lithuania Outlook Agenda

  42. Spread * Quantity = Profits Committed volume growth upto year 2007... More than 1 Billion pieces Growth 154% • PET Polymers: • Current PET capacity 206,000 tons • 2007 PET capacity 524,000 tons • Completed: • Forward integration into bottles for • 150m. pieces • Capacity increase in preforms by • 42% and closures 50% • Expansion in line with growth plans • of customers 47

  43. Outlook • PET Polymers demand growth at 8-10%, replacing aluminium and • glass as cost effective and convenience of use • Asian operating rates to improve with limited new capacity additions • Raw materials in a long market, increasing supply, and larger volume • purchase to leverage favorable prices Raw material prices are rising and we expect to pass rising costs to our customers …IRP, Prepared and Enthusiastic 48

  44. 7th largest global PET producer with end-2006 capacity at 524,000 tons Only PET producer with production facility in Asia, Europe and North America enabling to capture demand growth in all markets Regional presence provides ability to service large global customers at low logistics cost Large volume purchase of raw materials enable higher volume discounts thereby increasing spread High capacity utilization resulting in lower conversion costs New plants of economic size at lower capex IRP Positioning 49

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