Signs of Rising Competition 12M Price Target MYR 4.60 (+0%)

4.59

March 11, 2019

Top Glove (TOPG MK) HOLD Share Price MYR 4.59 Signs of rising competition 12m Price Target MYR 4.60 (+0%)

Previous Price Target MYR 5.10 Shariah Compliant Shariah

Lowering earnings estimates and TP; maintain HOLD Company Description Top Glove is the world's biggest glove manufacturer Upcoming 2QFY8/19 earnings could be flattish sequentially and YoY, and with a balanced product mix in latex/nitrile come in below expectations. We lower our FY19-21 EPS estimates by 7- examination gloves and non-examination gloves. 10% as we see rising competition in the near-term. Consequently, our TP is reduced to MYR4.60 (-10%) based on an unchanged CY20 PER target of 24x (10% below our target PER for Hartalega). Maintain HOLD. Statistics 52w high/low (MYR) 6.15/2.88 2QFY19E: Expect flattish earnings 3m avg turnover (USDm) 11.5 Free float (%) 53.8 2QFY19 results is scheduled to be released on 22nd Mar. We expect Issued shares (m) 2,561 earnings to be flattish QoQ and YoY (1QFY19: MYR110m; 2QFY18: Market capitalisation MYR11.8B

Industrials MYR109m): (i) volume growth could be flattish QoQ (but +10-15% YoY) USD2.9B given that no new capacity was added since 1QFY19 and its overall plant Major shareholders: utilisation rate is already maxed out at 90% since 2QFY18; (ii) EBITDA LIM WEE CHAI 28.9% margin could also be flattish QoQ and YoY as the lower NBR cost offset Employees Provident Fund 5.8% the lower USD/MYR; (iii) Aspion could turn slightly profitable in 2QFY18 Kumpulan Wang Persaraan 5.1% (1QFY19: MYR3-4m net loss) owing to the improved productivity. Despite +10-15% YoY volume growth in 2QFY19, earnings could be flattish YoY due Price Performance to a higher tax rate (2QFY18: 12%). 6.50 260

6.00 240 Malaysia More supply from China? 5.50 220 While there is no production data from China, we highlight that the vinyl 5.00 200 glove ASP has been on a downtrend since Mar 2018 and has fallen to a 5- 4.50 180 year low of USD10/’000 pcs in Mar 2019 (-9% MoM), signalling a much 4.00 160 higher supply of vinyl gloves currently. Though vinyl glove is mainly used 3.50 140 3.00 120 in the non-medical segment, Malaysian glove players also benefitted 2.50 100 somewhat in 2017-18 as they produced the cheaper vinyl glove to fill the 2.00 80 supply vacuum. Hence, a resumption of China’s supply may also affect Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Malaysian players’ volumes/margins slightly. Vinyl gloves contributed 3% Top Glove - (LHS, MYR) Top Glove / Kuala Lumpur Composite Index - (RHS, %) to Top Glove’s revenue in 1QFY19. -1M -3M -12M Revisiting assumptions Absolute (%) (6) (22) (1) Relative to index (%) (6) (22) 8 We lower our FY19-21 EPS forecasts by 7%/10%/8% as we lower EBITDA Source: FactSet margin assumptions by 0.3-ppt/0.5-ppt/0.3-ppt. However, because of consolidation of Aspion’s full-year earnings in FY19, our projected FY19- 21 EBITDA margins would still be higher than that of FY18 (+0.4-0.6-ppt). Top Glove: Sales volume breakdown (1QFY19) FYE Aug (MYR m) FY17A FY18A FY19E FY20E FY21E Revenue 3,409 4,214 4,648 5,073 5,570 EBITDA 485 692 790 852 949 Core net profit 333 434 450 473 530 Core EPS (sen) 13.3 17.2 17.6 18.5 20.7 Nitrile Plastic Core EPS growth (%) (8.0) 29.3 2.5 5.1 12.1 41% 10% Net DPS (sen) 7.3 8.5 8.8 9.2 10.6 Surgical Core P/E (x) 21.1 32.5 26.1 24.8 22.1 3% P/BV (x) 3.5 5.9 4.5 4.1 3.8 Powder Powdered Net dividend yield (%) 2.6 1.5 1.9 2.0 2.3 free latex ROAE (%) 17.4 19.7 17.9 17.2 17.7 latex 32% ROAA (%) 11.9 10.6 8.3 8.2 8.7 19% EV/EBITDA (x) 14.4 23.0 17.3 16.0 14.3 Net gearing (%) (incl perps) net cash 76.8 71.6 65.4 58.5 Consensus net profit - - 498 563 620

MKE vs. Consensus (%) - - (9.7) (16.1) (14.5) Source: Company

Lee Yen Ling lee.yl@maybank-ib.com (603) 2297 8691

THIS REPORT HAS BEEN PREPARED BY MAYBANK INVESTMENT BANK BERHAD PP16832/01/2013 (031128) SEE PAGE 6 FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS Top Glove

Fig 1: Top Glove: Capacity expansion plan (2Q19: +6%, 3Q19: +2%; 4Q19: +8%) New plants planned Location Glove type No. of production lines Capacity (b pcs p.a.) Target commencement F32 (phase 1) Malaysia Nitrile/Latex 22 2.2 2Q19 F33 Malaysia Latex 12 1.2 2Q19 F32 (phase 2) Malaysia Nitrile/Latex 12 1.2 3Q19 F2B Refurbishment Malaysia Nitrile 4 0.8 4Q19 F5A Malaysia Nitrile/Latex 20 2.0 4Q19 F40 (phase 1) Malaysia Nitrile 22 2.2 4Q19 F40 (phase 2) Malaysia Nitrile 8 0.8 1Q20 F41 (phase 1) Vietnam PVC 20 2.0 2Q20 F8A (pahse 1) Thailand Nitrile 32 3.2 3Q20 F42 (phase 1) Malaysia Nitrile 20 4.8 4Q20 Total expansion by 4Q20 172 20.4

Add: Existing 32 factories 648 60.5

Total capacity by 4Q20: 38 glove factories 820 80.9

Source: Company, Maybank Kim Eng

Fig 2: Top Glove: One-year rolling forward PER (trading at 25x Fig 3: Top Glove: Foreign shareholding (Jan 2019: 34%) now)

PE (x) 45% 36 43% 42% 42% +2SD: 29.5x 43% 32 41% 41% 28 +1SD: 23.3x 39% 24 37% 36% Mean: 17.4x 35% 20 35%

16 33% 32% 34% -1SD: 11.6x 12 31% 31% 31%

8 29%

Jul-16

Jan-19

Oct-15

Jun-13 Jun-14 Jun-15

Sep-15 Sep-16 Sep-17 Sep-18

Mar-16 Mar-17

Feb-18

Jul-14 Jul-15 Jul-16 Jul-17 Jul-18

Dec-13 Dec-14 Dec-18

Nov-15 Nov-16 Nov-17

May-16 May-17 May-18

Apr-14 Apr-15 Apr-16 Apr-17 Apr-18

Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19

Oct-14 Oct-15 Oct-16 Oct-17 Oct-18

Source: Bloomberg, Company, Maybank Kim Eng Source: Company, Maybank Kim Eng

Fig 4: Gloves: Sector comparison table 2-yr EPS Stock B'berg Rec Mkt cap Shr px TP PER (x) P/B (x) ROE (%) DY (%) PEG (2018-20) ticker (USD m) (Local) (Local) CY18 CY19 CY20 CY19 CY19 CY19 CAGR (%) (x)

Hartalega HART MK Sell 4,053.0 4.97 4.35 34.8 33.4 30.8 7.0 23.2% 1.8% 6.4% 5.2 Top Glove TOPG MK Hold 2,870.2 4.59 4.60 26.5 25.6 23.9 4.3 19.1% 1.9% 5.4% 4.7 Kossan KRI MK Hold 1,185.6 3.79 4.35 24.8 21.6 19.0 3.5 15.7% 1.8% 14.4% 1.5 Supermax * SUCB MK NR 494.0 1.54 NR 16.4 13.5 12.5 1.7 12.1% 2.9% 14.4% 0.9 Comfort* CG MK NR 114.1 0.83 NR 16.2 12.1 11.9 NA 14.5% 3.5% 16.9% NA Average 23.8 21.3 19.6 4.1 16.9% 2.4% 11.5% 3.1

Source: Bloomberg, Consensus (*), Maybank Kim Eng

Risk statement

There are several risk factors for our earnings estimates, price target, and rating for Top Glove. Abrupt changes in the momentum of input costs (i.e. latex, NBR) and intensive competition may lead to lower earnings for Top Glove. Additionally, sharp appreciation of MYR against USD will also negatively affect its earnings, for almost the entire Group’s revenue is derived in USD.

March 11, 2019 2

Top Glove

FYE 31 Aug FY17A FY18A FY19E FY20E FY21E Key Metrics P/E (reported) (x) 19.6 25.8 26.1 24.8 22.1 Core P/E (x) 21.1 32.5 26.1 24.8 22.1 P/BV (x) 3.5 5.9 4.5 4.1 3.8 P/NTA (x) 3.5 12.4 8.6 7.4 6.3 Net dividend yield (%) 2.6 1.5 1.9 2.0 2.3 FCF yield (%) nm nm 2.1 2.5 3.2 EV/EBITDA (x) 14.4 23.0 17.3 16.0 14.3 EV/EBIT (x) 18.7 29.2 22.9 21.7 19.6

INCOME STATEMENT (MYR m) Revenue 3,409.2 4,214.0 4,648.0 5,072.8 5,570.4 Gross profit 681.8 863.9 999.3 1,090.7 1,197.6 EBITDA 485.0 692.5 789.6 852.1 949.1 Depreciation (111.8) (146.0) (193.6) (223.8) (254.2) Amortisation 0.0 0.0 0.0 0.0 0.0 EBIT 373.2 546.4 595.9 628.3 694.9 Net interest income /(exp) 10.9 (23.1) (68.5) (68.7) (67.1) Associates & JV (1.0) (0.7) (0.7) (0.7) (0.7) Exceptionals 0.0 0.0 0.0 0.0 0.0 Other pretax income 0.0 0.0 0.0 0.0 0.0 Pretax profit 383.1 522.7 543.8 578.1 647.3 Income tax (50.5) (85.4) (90.3) (101.8) (113.9) Minorities 0.1 (3.7) (3.7) (3.7) (3.7) Discontinued operations 0.0 0.0 0.0 0.0 0.0 Reported net profit 332.7 433.6 449.8 472.6 529.7 Core net profit 332.7 433.6 449.8 472.6 529.7

BALANCE SHEET (MYR m) Cash & Short Term Investments 447.0 357.9 370.4 376.0 423.2 Accounts receivable 422.2 671.3 740.4 808.1 887.4 Inventory 315.8 513.7 566.7 618.4 679.1 Reinsurance assets 0.0 0.0 0.0 0.0 0.0 Property, Plant & Equip (net) 1,606.6 2,082.2 2,288.5 2,464.8 2,610.6 Intangible assets 22.8 1,271.4 1,271.4 1,271.4 1,271.4 Investment in Associates & JVs 0.4 2.1 1.4 0.8 0.1 Other assets 126.5 374.8 374.8 374.8 374.8 Total assets 2,941.1 5,273.4 5,613.7 5,914.3 6,246.5 ST interest bearing debt 314.6 854.2 854.2 854.2 854.2 Accounts payable 419.5 485.3 535.3 584.2 641.5 Insurance contract liabilities 0.0 0.0 0.0 0.0 0.0 LT interest bearing debt 61.8 1,359.1 1,409.1 1,409.1 1,409.1 Other liabilities 129.0 160.0 171.0 183.0 195.0 Total Liabilities 924.5 2,858.3 2,970.0 3,030.6 3,099.6 Shareholders Equity 2,007.4 2,404.5 2,629.4 2,865.7 3,125.3 Minority Interest 9.2 10.6 14.3 18.0 21.7 Total shareholder equity 2,016.6 2,415.1 2,643.7 2,883.7 3,147.0 Total liabilities and equity 2,941.1 5,273.4 5,613.7 5,914.3 6,246.5

CASH FLOW (MYR m) Pretax profit 383.1 522.7 543.8 578.1 647.3 Depreciation & amortisation 111.8 146.0 193.6 223.8 254.2 Adj net interest (income)/exp (10.9) 23.1 68.5 68.7 67.1 Change in working capital (44.7) (279.0) (72.1) (70.5) (82.6) Cash taxes paid (65.5) (36.8) (90.3) (101.8) (113.9) Other operating cash flow 0.0 0.0 0.0 0.0 0.0 Cash flow from operations 388.9 379.4 644.3 698.9 772.8 Capex (447.1) (1,729.1) (400.0) (400.0) (400.0) Free cash flow (58.2) (1,349.7) 244.3 298.9 372.8 Dividends paid (181.7) (201.6) (224.9) (236.3) (270.1) Equity raised / (purchased) 0.0 14.5 0.0 0.0 0.0 Change in Debt (24.8) 1,471.7 50.0 0.0 0.0 Other invest/financing cash flow 284.2 2.1 (56.8) (57.0) (55.4) Effect of exch rate changes 0.0 0.0 0.0 0.0 0.0 Net cash flow 20.2 (63.0) 12.5 5.6 47.2

March 11, 2019 3

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FYE 31 Aug FY17A FY18A FY19E FY20E FY21E Key Ratios Growth ratios (%) Revenue growth 18.0 23.6 10.3 9.1 9.8 EBITDA growth (7.3) 42.8 14.0 7.9 11.4 EBIT growth (10.2) 46.4 9.1 5.4 10.6 Pretax growth (13.4) 36.4 4.0 6.3 12.0 Reported net profit growth (7.9) 30.3 3.7 5.1 12.1 Core net profit growth (7.9) 30.3 3.7 5.1 12.1

Profitability ratios (%) EBITDA margin 14.2 16.4 17.0 16.8 17.0 EBIT margin 10.9 13.0 12.8 12.4 12.5 Pretax profit margin 11.2 12.4 11.7 11.4 11.6 Payout ratio 54.6 49.5 50.0 50.0 51.0

DuPont analysis Net profit margin (%) 9.8 10.3 9.7 9.3 9.5 Revenue/Assets (x) 1.2 0.8 0.8 0.9 0.9 Assets/Equity (x) 1.5 2.2 2.1 2.1 2.0 ROAE (%) 17.4 19.7 17.9 17.2 17.7 ROAA (%) 11.9 10.6 8.3 8.2 8.7

Liquidity & Efficiency Cash conversion cycle 29.3 42.7 57.6 57.9 57.7 Days receivable outstanding 40.6 46.7 54.7 54.9 54.8 Days inventory outstanding 38.2 44.6 53.3 53.6 53.4 Days payables outstanding 49.5 48.6 50.3 50.6 50.5 Dividend cover (x) 1.8 2.0 2.0 2.0 2.0 Current ratio (x) 1.6 1.1 1.2 1.2 1.3

Leverage & Expense Analysis Asset/Liability (x) 3.2 1.8 1.9 2.0 2.0 Net gearing (%) (incl perps) net cash 76.8 71.6 65.4 58.5 Net gearing (%) (excl. perps) net cash 76.8 71.6 65.4 58.5 Net interest cover (x) na 23.7 8.7 9.1 10.4 Debt/EBITDA (x) 0.8 3.2 2.9 2.7 2.4 Capex/revenue (%) 13.1 41.0 8.6 7.9 7.2 Net debt/ (net cash) (70.6) 1,855.3 1,892.8 1,887.2 1,840.0 Source: Company; Maybank

March 11, 2019 4

Top Glove

Research Offices

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March 11, 2019 5

Top Glove

APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLAIMERS AND DISCLOSURES

DISCLAIMERS This research report is prepared for general circulation and for information purposes only and under no circumstances should it be considered or intended as an offer to s ell or a solicitation of an offer to buy the securities referred to herein. Investors should note that values of such securities, if any, may fluctuate and that each security’s price or value may rise or fall. Opinions or recommendations contained herein are in form of technical ratings and fundamental ratings. Technical ratings may differ fr om fundamental ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from the relevant jurisdiction’s stock exchange in the equity analysis. Accordingly, investors’ returns may be less than the original sum invested. Past performance is not necessarily a guide to future performance. This report is not intended to provide personal investment ad vice and does not take into account the specific investment objectives, the financial situation and the particular needs of persons who may receive or read this report. Investors should therefore seek financial, legal and other advice regarding the appropriateness of investing in any securities or the investment strategies discussed or recommended in this report. The information contained herein has been obtained from sources believed to be reliable but such sources have not been independently verified by Maybank Investment Bank Berhad, its subsidiary and affiliates (collectively, “MKE”) and consequently no representation is made as to the accuracy or completeness of this report by MKE and it should not be relied upon as such. Accordingly, MKE and its officers, directors, associates, connected parties and/or employees (collectively, “Representatives” ) shall not be liable for any direct, indirect or consequential losses or damages that may arise from the use or reliance of this report. Any information, opinions or recommendations contai ned herein are subject to change at any time, without prior notice. This report may contain forward looking statements which are often but not always identified by the use of words such as “anticipate”, “belie ve”, “estimate”, “intend”, “plan”, “expect”, “forecast”, “predict” and “project” and statements that an event or result “may”, “will”, “can”, “should”, “could” or “might” occur or be achieved and other similar expressions. Such forward looking statements are based on assumptions made and information currently available to us and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those expressed in any forward looking statements. Readers are cautioned not to place undue relevance on these forward-looking statements. MKE expressly disclaims any obligation to update or revise any such forward looking statements to reflect new information, events or circumstances after the date of this publication or to reflect the occurrence of unanticipated events. MKE and its officers, directors and employees, including persons involved in the preparation or issuance of this report, may, to the extent permitted by law, from time to time participate or invest in financing transactions with the issuer(s) of the securities mentioned in this report, perform services for or solic it business from such issuers, and/or have a position or holding, or other material interest, or effect transactions, in such securities or options thereon, or other investments related thereto. In addition, it may make markets in the securities mentioned in the material presented in this report. One or more directors, officers and/or employees of MKE may be a director of the issuers of the securities mentioned in this report to the extent permitted by law. This report is prepared for the use of MKE’s clients and may not be reproduced, altered in any way, transmitted to, copied or distributed to any other party in whole or in part in any form or manner without the prior express written consent of MKE and MKE and its Representatives accepts no liability whatsoever for t he actions of third parties in this respect. This report is not directed to or intended for distribution to or use by any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. This report is for distribution only under such circumstances as may be permitted by applicable law. The securities described herein may not be eligible for sale in all jurisdictions or to certain categories of investors. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply based on geographical location of the person or entity receiving this repor t. Malaysia Opinions or recommendations contained herein are in the form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from Bursa Malaysia Securities Berhad in the equity analysis. Singapore This report has been produced as of the date hereof and the information herein may be subject to change. Maybank Kim Eng Rese arch Pte. Ltd. (“Maybank KERPL”) in Singapore has no obligation to update such information for any recipient. For distribution in Singapore, recipients of this report are to cont act Maybank KERPL in Singapore in respect of any matters arising from, or in connection with, this report. If the recipient of this report is not an accredited investor, expert investor or institutional investor (as defined under Section 4A of the Singapore Securities and Futures Act), Maybank KERPL shall be legally liable for the contents of this report, with such liability being limited to the extent (if any) as permitted by law. Thailand Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of Maybank Kim Eng Securities (Thailand) Public Company Limited. Maybank Kim Eng Securities (Thailand) Public Company Limited (“MBKET”) accepts no liability whatsoeve r for the actions of third parties in this respect. Due to different characteristics, objectives and strategies of institutional and retail investors, the research reports of MBKET Institutional and Retail Resea rch Department may differ in either recommendation or target price, or both. MBKET Retail Research is intended for retail investors (http://kelive.maybank-ke.co.th) while Maybank Kim Eng Institutional Research is intended only for institutional investors based outside Thailand only. The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the Office of the Securit ies and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailan d and the market for Alternative Investment disclosed to the public and able to be accessed by a general public investor. The result, therefore, is from the perspective of a third party. It is not an evaluation of operation and is not based on inside information. The survey result is as of the date appearing in the Corporate Governance Report of Thai Listed Companies. As a resul t, the survey may be changed after that date. MBKET does not confirm nor certify the accuracy of such survey result. The disclosure of the Anti-Corruption Progress Indicators of a listed company on the Stock Exchange of Thailand, which is assessed by Thaipat Institute, is made in order to comply with the policy and sustainable development plan for the listed companies of the Office of the Securities and Exchange Commission. Thaipat Institute made this assessment based on the information received from the listed company, as stipulated in the form for the assessment of Anti-corruption which refers to the Annual Registration Statement (Form 56-1), Annual Report (Form 56-2), or other relevant documents or reports of such listed company. The assessment result is therefore made from the perspective of Thaipat Institute that is a third party. It is not an assessment of operation and is not based on any inside information. Since this assessment is only the assessment result as of the date appearing in the assessment result, it may be changed after that date or when there is any change to the relevant information. Nevertheless, MBKET does not confirm, verify, or certify the accuracy and completeness of the assessment result. US This third-party research report is distributed in the United States (“US”) to Major US Institutional Investors (as defined in Rule 15a-6 under the Securities Exchange Act of 1934, as amended) only by Maybank Kim Eng Securities USA Inc (“Maybank KESUSA”), a broker-dealer registered in the US (registered under Section 15 of the Securities Exchange Act of 1934, as amended). All responsibility for the distribution of this report by Maybank KESUSA in the US shall be borne by Maybank KESUSA. This report is not directed at you if MKE is prohibited or restricted by any legislation or regulation in any jurisdiction from making it available to you. You should satisfy yourself before reading it that Maybank KESUSA is permitted to provide research material concerning investments to you under relevant legislation and regulations. All U.S. persons receiving and/or accessing this re port and wishing to effect transactions in any security mentioned within must do so with: Maybank Kim Eng Securities USA Inc. 400 Park Avenue, 11th Floor, New York, New York 10022, 1-(212) 688-8886 and not with, the issuer of this report.

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UK This document is being distributed by Maybank Kim Eng Securities (London) Ltd (“Maybank KESL”) which is authorized and regulated, by the Financial Conduct Authority and is for Informational Purposes only. This document is not intended for distribution to anyone defined as a Retail Client under the Financial Services and Markets Act 2000 within the UK. Any inclusion of a third party link is for the recipients convenience only, and that the firm does not take any responsibility fo r its comments or accuracy, and that access to such links is at the individuals own risk. Nothing in this report should be considered as constituting legal, accounting or tax advice, and that for accurate guidance recipients s hould consult with their own independent tax advisers. DISCLOSURES

Legal Entities Disclosures Malaysia: This report is issued and distributed in Malaysia by Maybank Investment Bank Berhad (15938- H) which is a Participating Organization of Bursa Malaysia Berhad and a holder of Capital Markets and Services License issued by the Securities Commission in Malaysia. Singapore: This report is distributed in Singapore by Maybank KERPL (Co. Reg No 198700034E) which is regulated by the Monetary Authority of Singapore. Indonesia: PT Maybank Kim Eng Securities (“PTMKES”) (Reg. No. KEP-251/PM/1992) is a member of the Indonesia Stock Exchange and is regulated by the Financial Services Authority (Indonesia). Thailand: MBKET (Reg. No.0107545000314) is a member of the Stock Exchange of Thailand and is regulated by the Ministry of Finance and the Securities and Exchange Commission. Philippines: Maybank ATRKES (Reg. No.01-2004-00019) is a member of the Philippines Stock Exchange and is regulated by the Securities and Exchange Commission. Vietnam: Maybank Kim Eng Securities Limited (License Number: 117/GP-UBCK) is licensed under the State Securities Commission of Vietnam. Hong Kong: KESHK (Central Entity No AAD284) is regulated by the Securities and Futures Commission. India: Kim Eng Securities India Private Limited (“KESI”) is a participant of the National Stock Exchange of India Limited and the Bombay Stock Exchange and is regulated by Securities and Exchange Board of India (“SEBI”) (Reg. No. INZ000010 538). KESI is also registered with SEBI as Category 1 Merchant Banker (Reg. No. INM 000011708) and as Research Analyst (Reg No: INH000000057) US: Maybank KESUSA is a member of/ and is authorized and regulated by the FINRA – Broker ID 27861. UK: Maybank KESL (Reg No 2377538) is authorized and regulated by the Financial Conduct Authority.

Disclosure of Interest Malaysia: MKE and its Representatives may from time to time have positions or be materially interested in the securities referred to herein and may further act as market maker or may have assumed an underwriting commitment or deal with such securities and may also perform or seek to perform investment banking services, advisory and other services for or relating to those companies.

Singapore: As of 11 March 2019, Maybank KERPL and the covering analyst do not have any interest in any companies recommended in this research report.

Thailand: MBKET may have a business relationship with or may possibly be an issuer of derivative warrants on the securities /companies mentioned in the research report. Therefore, Investors should exercise their own judgment before making any investment decisions. MBKET, its associates, directors, connected parties and/or employees may from time to time have interests and/or underwriting commitments in the securities mentioned in this report.

Hong Kong: KESHK may have financial interests in relation to an issuer or a new listing applicant referred to as defined by the requirements under Paragraph 16.5(a) of the Hong Kong Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission.

As of 11 March 2019, KESHK and the authoring analyst do not have any interest in any companies recommended in this research report.

MKE may have, within the last three years, served as manager or co-manager of a public offering of securities for, or currently may make a primary market in issues of, any or all of the entities mentioned in this report or may be providing, or have provided within the previous 12 months, significant advice or investment services in relation to the investment concerned or a related investment and may receive compensation for the services provided from the companies covered in this report.

OTHERS Analyst Certification of Independence The views expressed in this research report accurately reflect the analyst’s personal views about any and all of the subject securities or issuers; and no part of the research analyst’s compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in the re port. Reminder Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to soph isticated investors who are capable of understanding and assuming the risks involved. The market value of any structured security may be affected by changes in economic, financial and political factors (including, but not limited to, spot and forward interest and exchange rates), time to maturity, market conditions and volatility and the credit quality of any issuer or reference issuer. Any investor interested in purchasing a structured product should conduct its own analysis of the product and consult with its own professional advisers as to the risks involved in making such a purchase. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior consent of MKE.

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Historical recommendations and target price: Top Glove (TOPG MK)

11 Sep 20 Dec 15 Jan 19 Jun 9 Jul 10 Jul 12 Oct 17 Oct 16 Jan 7 Mar Hold : RM3.1 Hold : RM3.8 Hold : RM4.9 Buy : RM6.4 Hold : RM6.4 Hold : RM4.9 Buy : RM6.0 Buy : RM6.4 Hold : RM5.1 Hold : RM4.6

7.0

6.0

5.0

4.0

3.0

2.0 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19

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Definition of Ratings Maybank Kim Eng Research uses the following rating system BUY Return is expected to be above 10% in the next 12 months (excluding dividends) HOLD Return is expected to be between - 10% to +10% in the next 12 months (excluding dividends) SELL Return is expected to be below -10% in the next 12 months (excluding dividends)

Applicability of Ratings The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies.

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 Malaysia  Singapore  London  New York Maybank Investment Bank Berhad Maybank Kim Eng Securities Pte Ltd Maybank Kim Eng Securities Maybank Kim Eng Securities USA (A Participating Organisation of Maybank Kim Eng Research Pte Ltd (London) Ltd Inc Bursa Malaysia Securities Berhad) 50 North Canal Road PNB House 400 Park Avenue, 11th Floor 33rd Floor, Menara Maybank, Singapore 059304 77 Queen Victoria Street New York, New York 10022, 100 Jalan Tun Perak, London EC4V 4AY, UK U.S.A. 50050 Kuala Lumpur Tel: (65) 6336 9090 Tel: (603) 2059 1888; Tel: (44) 20 7332 0221 Tel: (212) 688 8886 Fax: (603) 2078 4194 Fax: (44) 20 7332 0302 Fax: (212) 688 3500

Stockbroking Business:  Hong Kong  Indonesia  India Level 8, Tower C, Dataran Maybank, Kim Eng Securities (HK) Ltd PT Maybank Kim Eng Securities Kim Eng Securities India Pvt Ltd No.1, Jalan Maarof 28/F, Lee Garden Three, Sentral Senayan III, 22nd Floor 2nd Floor, The International, 59000 Kuala Lumpur 1 Sunning Road, Causeway Bay, Jl. Asia Afrika No. 8 16, Maharishi Karve Road, Tel: (603) 2297 8888 Hong Kong Gelora Bung Karno, Senayan Churchgate Station, Fax: (603) 2282 5136 Jakarta 10270, Indonesia Mumbai City - 400 020, India Tel: (852) 2268 0800 Fax: (852) 2877 0104 Tel: (62) 21 2557 1188 Tel: (91) 22 6623 2600 Fax: (62) 21 2557 1189 Fax: (91) 22 6623 2604

 Philippines  Thailand  Vietnam  Saudi Arabia Maybank ATR Kim Eng Securities Inc. Maybank Kim Eng Securities Maybank Kim Eng Securities Limited In association with 17/F, Tower One & Exchange Plaza (Thailand) Public Company Limited 4A-15+16 Floor Vincom Center Dong Anfaal Capital Ayala Triangle, Ayala Avenue 999/9 The Offices at Central World, Khoi, 72 Le Thanh Ton St. District 1 Villa 47, Tujjar Jeddah Makati City, Philippines 1200 20th - 21st Floor, Ho Chi Minh City, Vietnam Prince Mohammed bin Abdulaziz Rama 1 Road Pathumwan, Street P.O. Box 126575 Tel: (63) 2 849 8888 Bangkok 10330, Thailand Tel : (84) 844 555 888 Jeddah 21352 Fax: (63) 2 848 5738 Fax : (84) 8 38 271 030 Tel: (66) 2 658 6817 (sales) Tel: (966) 2 6068686 Tel: (66) 2 658 6801 (research) Fax: (966) 26068787

 South Asia Sales Trading  North Asia Sales Trading Kevin Foy Andrew Lee Regional Head Sales Trading [email protected] [email protected] Tel: (852) 2268 0283 Tel: (65) 6636-3620 US Toll Free: 1 877 837 7635 US Toll Free: 1-866-406-7447

Indonesia London Iwan Atmadjaja Greg Smith [email protected] [email protected] (62) 21 8066 8555 Tel: (44) 207-332-0221

New York India James Lynch Sanjay Makhija [email protected] [email protected] Tel: (212) 688 8886 Tel: (91)-22-6623-2629

Philippines Keith Roy [email protected] Tel: (63) 2 848-5288

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