• Corporate activities influenced by certain kind of financial risks; market risk (including foreign exchange risk, commodity price risk, and interest rate risk), credit risk, liquidity risk and capital risk. Generally, financial risk management program of the corporate is focusing on uncertainties of the financial markets and attempting to minimize improper effects towards corporate financial performance.

    Corporate board of directors operates risk management including identification, evaluation and value driven maintenance towards financial risk, if it’s necessary. Board of director provides the whole principles to manage risks, including market risks, credit risks, liquidity risk and capital risk.

    Risk as listed below is formed based on weight of each impact towards corporate financial performance, operational activities, business prospects, and stocks investment.

    1.      Risk of rapid growth of digital technology.

    Cellphone is one of electronic devices that experiences rapid-growth. Corporate’s products have sophisticated technology that has to be in line with the world technology in order to compete with similar products. Changes in a technology that is more advanced and significant from the products sold by the company at this time, can materially, negatively and directly impacting sale of the company's products and resulting in non-salable inventories. This risk may negatively affect the financial performance, operational activities and business prospects.

    2.      Risk of incapability to market product innovation and new services.

    One of the factors that may impact company’s sales achievement is the company’s capability to develop and to market trending products and new services. If the company is incapable to provide those products, it may cause risks of losing market share and competitiveness, and it would impact the growth rate and cause effects materially and negatively towards income and business prospects.

         3.      Risk of decreasing the quality of the company's products.

    The company doesn’t produce its own cellphone products, so there is a possibility of degradation of product quality. This may cause market share and competitiveness reduction, and it would impact the growth rate and cause effects materially and negatively towards income and business prospects.

    4.      Risk of continuity product supply marketed by the company.

    Company has no agreement that tied supplier; supplier is able to distribute its products to other companies, since the purchase mechanism is purchase order. There is also no guarantee that tied supplier to continuously distribute its products to company in coming years, and it would impact the growth rate and cause effects materially and negatively towards income and business prospects.

    5.      Risk of dependency to retailers.

    As cellphones distributor, company is highly dependent to retailer’s enthusiasm and revenue when it comes to selling company’s products. Company’s sales degradation towards retailers would impact the growth rate and cause effects materially and negatively towards income and business prospects.

    6.      Risk of business competition in cellphone, pad and prepaid vouchers industry.

    Business competition in cellphone, pad and prepaid vouchers industry is very intense. Various brands are being sold in the market including brands whom partnering with the company. As more brands are freely marketed in public, it can affect the company's market share. These risks may materially and negatively affect the financial performance, operational activities and business prospects.

    7.      Foreign exchange fluctuation risk

    Company is facing foreign exchange fluctuation risk, which products purchased from the distributor are dealt with a significant amount in foreign currency, while the company revenue is obtained in Rupiah. The weakening of Rupiah exchange rate may materially and negatively affect the financial performance, operational activities and business prospects.

         8.      Risk of consumer choice possibility changes.

    The existence of a wide range of new brands with increasing content and applications can affect the consumer's wish and need for choosing other brands if the company does not actively update its products. These risks may materially and negatively affect the financial performance, operational activities and business prospects

    9.      Governance risk of regulatory change in telecommunication and cellular phone market.

    The field of telecommunications is one of many fields regulated by Government regulations such as regulations of the Ministry of Industry and Ministry of Trade, especially for smartphone importers. Currently, company’s main activities are trading cell phones, gadget and prepaid vouchers. If there is any regulatory change in telecommunication, which is related with cell phones, it may materially and negatively affect the financial performance, operational activities and business prospects.

    10. Risk of consumer buying decision on special occasion.

    Demand for cell phones often increase on special occasion such religious and public holidays, if there is a new product equipped with more advanced technology and with special price. The increase of purchase frequency only on religious or public holidays, and if there is a new product equipped with more advanced technology and with special price may materially and negatively affect the financial performance, operational activities and business prospects.

    11. Risk of economic growth in Indonesia

    Economical situation in Indonesia is potentially having an impact towards the company’s business continuity. If economical situation in Indonesia weakened and faces financial issues, it would also affect the consumer buying power. This risk may materially and negatively affect the financial performance, operational activities and business prospects.

          12. Risk of natural disasters

    Natural disasters are an uncontrollable factor by the company. If natural disaster occurs such floods, earthquakes etc., it would have an impact on sales activities of the company or retailers. This risk may materially and negatively affect the financial performance, operational activities and business prospects.