March 21, 2014

SP Setia (SPSB MK)

Share Price: MYR2.95 MCap (USD): 2.2B

Target Price: MYR3.36(+13.5%) ADTV (USD): 0.8M Property HOLD (unchanged)

Results Review Results

Key Data Below expectations Shariah status NO . 1QFY10/14 net profit of MYR96.8m (+4% YoY) below 52w high/low (MYR) 3.99/2.70 expectations. Free float (%) 20.1 . Cutting our FY14/15/16 earnings forecasts by -9%/-9%/-10%. Issued shares (m) 2,459 Market capitalization MYR7.3B . Maintain HOLD with a reduced TP of MYR3.36 (-2 sen; on Major shareholders: unchanged 0.7x P/RNAV). Yayasan Pelaburan B 49.0% What’s New Skim Amanah Saham B 15.1% Kumpulan Wang Per 6.7% Excluding an estimated net gain of MYR29m from one-off EPF 6.3%

COMPANY RESEARCH | RESEARCH COMPANY commercial land sales at Setia Alam, SPSB’s 1QFY10/14 core net profit of MYR68m (-27% YoY, -47% QoQ) only accounted for 13-14% Share Price Performance of our and consensus full-year estimates. 4.50 1,950 4.00 1,875 The earnings shortfall was attributed to higher-than-expected 3.50 marketing and administrative expenses as well as higher 3.00 1,800 2.50 construction costs on labour shortage. As a result, pretax margin 1,725 2.00 (ex-land sales) declined by 4ppt YoY and 5ppt QoQ. 1.50 1,650 1.00 1,575 What’s Our View 0.50 0.00 1,500 4MFY10/14 locked-in new property sales were MYR1.8b (80% local: Mar-12 Sep-12 Mar-13 Sep-13 20% overseas), on track to meet the just-released sales target of SPSB MK Equity MYR5b for FY10/14 (-39% YoY). Township projects such as Setia Eco FBMKLCI Index Hill and Parque Melbourne were the key sales drivers, contributing 1 Mth 3 Mth 12 Mth 35% and 12.5% to 4MFY10/14 sales. Absolute (%) na (2.3) (11.7) The near-term earnings outlook will be backed by unbilled sales of Relative to country (%) 0.4 (0.7) (23.1)

MYR10.5b as at end-Jan 2014 (2.7x of our revenue FY14 forecast; Maybank vs Market 30% from UK and Australia projects whose profits can only be Positive Neutral Negative recognized upon completion). Market Recs 4 16 3 We cut our earnings forecasts to factor in higher administrative Maybank Consensus % +/- and marketing as well as construction costs (-2ppt to -3ppt cut in Target Price (MYR) 3.36 3.18 5.8 project margins). Our RNAV, is however, largely unchanged at 2014 Net Profit 481 521 (7.6) MYR4.79 (-4sen) after factoring in the MYR29m disposal gain. (MYR m) 2015 Net Profit 613 674 (9.0) (MYR m) FYE Oct (MYR m) FY12A FY13A FY14F FY15F FY16F Source: Bloomberg; Maybank

Revenue 2,526.6 3,060.5 4,073.2 5,232.2 5,811.7 EBITDA 601.0 631.8 757.9 961.0 1,096.3 Core net profit 372.9 417.9 481.3 613.2 690.6 Core EPS (sen) 18.9 17.8 19.6 24.9 28.1 Core EPS growth (%) 16.4 (5.7) 9.9 27.4 12.6 Net DPS (sen) 10.5 10.6 11.7 15.0 16.9 BVPS (MYR) 2.05 2.36 2.33 2.43 2.54 Core P/E (x) 15.2 16.2 14.7 11.5 10.3 EV/EBITDA (x) 23.1 18.9 10.6 13.1 14.2 Net dividend yield (%) 3.6 3.7 4.1 5.2 5.9 P/BV (x) 1.4 1.2 1.2 1.2 1.1 Net debt/equity (%) 57.8 41.4 58.6 58.2 57.2 Wong Wei Sum, CFA ROAE (%) 9.7 7.6 8.4 10.3 11.1 (603) 2297 8679 ROAA (%) 4.2 3.4 3.6 4.2 4.6 Chg in net profit (%) - - (9.0) (8.6) (10.2) [email protected]

SEE PAGE 6 FOR IMPORTANTDISCLOSURES AND ANALYST CERTIFICATIONS PP16832/01/2013 (031128)

SP Setia

Table 1: Quarterly summary table - SP Setia Quarterly FY Oct (MYR m) 1Q14 1Q13 % YoY 4Q13 % QoQ Comments Revenue 721.6 734.9 (1.8) 900.2 (19.8) 1QFY10/14: QoQ decline was due to seasonal factors. SPSB usually performs better in 2H of its financial year.

SPSB has raked in MYR1.8b in property sales in 4MFY10/14 (37% of its MYR5b sales target for FY10/14) whilst unbilled sales were MYR10.5b as at end-Jan 2014 (2.7x of our FY10/14 revenue forecast).

EBIT 169.8 150.5 12.8 199.1 (14.7) Finance costs (13.9) (11.9) 16.7 (19.3) (28.1) Net gearing improved to 0.29x, from 0.41x in end-Oct 2013. Associate (8.8) (2.9) >+100 (0.2) >+100 Exceptional item 39.6 0.0 NA 0.0 NA Gain from the disposal of commercial land at Setia Alam.

Profit before tax 147.2 135.7 8.4 179.6 (18.1) 1QFY10/14: Despite the YoY decline at revenue, PBT grew by 8.4% supported by the MYR39.6m exceptional gain. Taxation (30.2) (30.0) 0.6 (52.2) (42.2) Minority interest (20.2) (12.6) 60.9 (0.1) >+100 Net profit 96.8 93.2 3.9 127.3 (24.0) Below expectations; excluding the estimated disposal gain of MYR29m (net of tax), 1QFY10/14 core net profit (-27% YoY, - 47% QoQ) only accounted for 13-14% of our and consensus full- year estimates. NDPS (sen) 0.0 0.0 NA 7.0 NA

1Q14 1Q13 +/- ppt 4Q13 +/- ppt EBIT margin (%) 23.5 20.5 3.1 22.1 1.4 Tax rate (%) 20.5 22.1 (1.6) 29.1 (8.6) Sources: Company, Maybank KE

Foreign shareholding trending down since May’ 13 (%) 14 12.5 11.7 11.6 11.4 12 10.6 10.6 10.6 9.5 10 9.2 9.0 8.8 8.8 8.5 8

6

4 2.1 2

0 Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec Jan Feb 13 13 13 13 13 13 13 13 13 13 13 13 14 14 Source: Company

SPSB’s 4MFY4/14 sales were MYR1.8b (-9% YoY)

MYR m

1,800

1,600

1,400

1,200

1,000

800

600

400

200

0 12/10 03/11 06/11 09/11 12/11 03/12 06/12 09/12 12/12 03/13 06/13 09/13 12/13

Source: Company

March 21, 2014 2

SP Setia

Tan Sri Liew will continue to oversee UK and China projects

TS Liew has agreed to stay on as the chairman of the Battersea Project Holding Co Ltd (for the Battersea Power Station project in London) and managing director of Qinzhou Development (M) consortium S/B (for the Qinzhou Industrial Park project in China) until Sep 2015 to ensure the smooth and successful implementation of these international projects.

SPSB's Fully Diluted RNAV Remaining MV BV Surplus landbank Landbank Stake acres (MYRm) (MYRm) (MYRm) Malaysia Southern region Bukit Indah 100% 100.5 131.3 24.1 107.26 Setia Indah 100% 10.3 9.0 1.3 7.69 Setia Cascadia 100% 138.7 120.8 90.6 30.21 Setia Tropika 100% 156.5 136.3 48.1 88.28 Setia Eco Gardens 70% 323 422.1 77.4 241.30 Setia Business Park II 100% 107.7 93.8 51.6 42.22 Central region Setia Eco Glades @ 70% 205 357.2 321.5 25.00 Setia Eco Hills 100% 437 381.3 381.3 0.00 Semenyih land 100% 1,011 396.2 396.2 0.00 Setia Alam 100% 712 2,233.1 108.2 2,124.82 Setia Eco Park 50% 314.6 986.7 109.6 438.53 Setia Ngle & Nexus 2 70% 10 37.0 24.0 9.15 Kenny Hills Grande 70% 6.2 98.6 73.8 17.33 Northern region Setia Pearl 100% 21 75.5 26.2 49.31 Setia Greens 100% 12 43.1 28.2 14.90 Sub-total: 5,522.0 1,762.0 3,196.0

DCF (discount factor: 13-14%) NPV Malaysia Stake acres (MYRm) Setia Sky Residences, 70% 0 17.1 Setia City, Klang Valley 100% 114 570.4 KL Eco City, Klang Valley 100% 9 547.2 Setia Federal Hill at Bangsar, Klang Valley 50% 53 198.9 Seputeh Land, Klang Valley 100% 5 41.6 Brook Residences, 100% 0 2.4 , Penang 100% 0 17.9 Tanjung Bungah Penang 100% 35 122.3

Aeropod - Tg Aru, 70% 42 45.4 Setia Sky 88, Bahru 100% 1 34.9 British High Comm 100% 3 75.0 Templer Park 100% 195 91.5

Singapore 18 Woodsville 100% 0 13.2 Eco Sanctuary, Chestnut Avenue 100% 0 90.6 Australia Fulton Lane 100% 0 107.5 St Kilda 100% 2 62.1 United Kingdom Battersea Power Station 40% 34 997.6 Sub-total: 3,035.6 Grand total 6,231.6 Disposal gains 29.0 Shareholders fund - 2013 5,525.5 RNAV 11,786.1 Enlarged share capital (m shares) 2,458.7

FD RNAV (MYR/share) 4.79 Target price (MYR/share) (30% discount to RNAV) 3.36 Source: Company, Maybank KE

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SP Setia

INCOME STATEMENT (MYR m) BALANCE SHEET (MYR m) FY Oct 2013A 2014F 2015F 2016F FY Oct 2013A 2014F 2015F 2016F

Revenue 3,060.5 4,073.2 5,232.2 5,811.7 Fixed Assets 1,134.9 1,134.9 1,134.9 1,134.9 EBITDA 631.8 757.9 961.0 1,096.3 Other LT Assets 5,196.1 4,832.6 4,320.1 3,970.4 Depreciation & Amortisation 4.2 6.7 11.8 16.6 Cash/ST Investments 2,243.2 1,884.1 2,104.1 2,005.6

Operating Profit (EBIT) 627.6 751.2 949.2 1,079.7 Other Current Assets 3,867.5 5,371.7 6,885.3 7,927.5 Interest (Exp)/Inc (57.1) (42.9) (45.3) (45.7) Total Assets 12,441.8 13,223.3 14,444.4 15,038.5 Associates (0.2) 0.0 0.0 0.0 One-offs 0.0 0.0 0.0 0.0 ST Debt 614.4 614.4 614.4 614.4 Pre-Tax Profit 570.3 708.3 904.0 1,033.9 Other Current Liabilities 2,382.6 2,264.7 2,898.4 3,215.3 Tax (151.1) (177.1) (226.0) (258.5) LT Debt 3,915.1 4,621.9 4,963.1 4,963.1 Minority Interest (1.4) (49.9) (64.8) (84.8) Other LT Liabilities 5.0 5.0 6.0 7.0 Net Profit 417.9 481.3 613.2 690.6 Minority Interest (0.8) (0.8) (0.8) (0.8) Recurring Net Profit 417.9 481.3 613.2 690.6 Shareholders' Equity 5,525.5 5,718.1 5,963.3 6,239.6 Total Liabilities-Capital 12,441.8 13,223.3 14,444.4 15,038.5 Revenue Growth % 21.1 33.1 28.5 11.1 EBITDA Growth (%) 5.1 20.0 26.8 14.1 Share Capital (m) 2,345.0 2,458.7 2,458.7 2,458.7 EBIT Growth (%) 7.7 19.7 26.4 13.7 Gross Debt/(Cash) 4,529.5 5,236.4 5,577.5 5,577.5 Net Profit Growth (%) 6.1 15.2 27.4 12.6 Net Debt/(Cash) 2,286.3 3,352.3 3,473.5 3,571.9 Recurring Net Profit Growth 12.1 15.2 27.4 12.6 Working Capital 3,113.7 4,376.6 5,476.6 6,103.4 Tax(%) Rate % 25.0 25.0 25.0 25.0 Gross gearing % 82.0 91.6 93.5 89.4

CASH FLOW (MYR m) RATES & RATIOS FY Oct 2013A 2014F 2015F 2016F FY Oct 2013A 2014F 2015F 2016F

Profit before taxation 570.3 708.3 904.0 1,033.9 EBITDA Margin % 20.6 18.6 18.4 18.9 Depreciation 0.0 6.7 11.8 16.6 Pretax margin (%) 18.6 17.4 17.3 17.8 Net interest (136.6) (42.9) (45.3) (45.7) Net Profit Margin % 13.7 11.8 11.7 11.9 receipts/(payments) Working capital change 455.3 0.0 0.0 0.0 ROE % 7.6 8.4 10.3 11.1 Cash tax paid (244.4) (177.1) (226.0) (258.5) ROA % 3.4 3.6 4.2 4.6 Others (incl'd exceptional) (4.9) (4.9) (4.9) (4.9) Net Margin Ex. El % 13.7 11.8 11.7 11.9 Cash flow from operations 669.6 519.9 669.4 771.3 Dividend Cover (x) 1.6 1.7 1.7 1.7 Capex (1,648.1) (1,325.1) (501.8) (501.8) Interest Cover (x) 11.0 17.5 21.0 23.6 Disposal/(purchase) 17.1 0.0 0.0 0.0 Asset Turnover (x) 0.2 0.3 0.4 0.4 Others (81.5) 0.0 0.0 0.0 Asset/Debt (x) 2.7 2.5 2.6 2.7 Cash flow from investing (1,712.6 (1,325.1 (501.8) (501.8) Net Gearing % 41.4 58.6 58.2 57.2 Debt raised/(repaid) 642.4) 0.0) 0.0 0.0 Debt/ EBITDA (x) 7.2 6.9 5.8 5.1 Equity raised/(repaid) 1,338.6 0.0 0.0 0.0 Debt/ Market Cap (x) 0.7 0.7 0.8 0.8 Dividends (paid) (254.5) (260.7) (288.8) (367.9) Interest payments 52.6 0.0 0.0 0.0 Others 0.0 0.0 0.0 0.0 Cash flow from financing 1,779.0 (260.7) (288.8) (367.9)

Change in cash 736.1 (1,066.0) (121.2) (98.4)

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SP Setia

Research Offices

REGIONAL HONG KONG / CHINA INDONESIA Surachai PRAMUALCHAROENKIT (66) 2658 6300 ext 1470 WONG Chew Hann, CA Howard WONG Head of Research Wilianto IE Head of Research [email protected] Regional Head of Institutional Research (852) 2268 0648 (62) 21 2557 1125 • Auto • Conmat • Contractor • Steel (603) 2297 8686 [email protected] [email protected] [email protected] • Oil & Gas - Regional • Strategy Suttatip PEERASUB ONG Seng Yeow Alexander LATZER Rahmi MARINA (66) 2658 6300 ext 1430 Regional Head of Retail Research (852) 2268 0647 (62) 21 2557 1128 [email protected] (65) 6432 1453 [email protected] [email protected] • Media • Commerce [email protected] • Metals & Mining - Regional • Banking & Finance Sutthichai KUMWORACHAI Alexander GARTHOFF Jacqueline KO, CFA Aurellia SETIABUDI (66) 2658 6300 ext 1400 Institutional Product Manager (852) 2268 0633 [email protected] (62) 21 2953 0785 [email protected] (852) 2268 0638 • Consumer [email protected] • Energy • Petrochem [email protected] • Property Karen KWAN Termporn TANTIVIVAT (852) 2268 0640 [email protected] Anthony YUNUS ECONOMICS (66) 2658 6300 ext 1520 • Property & REITs (62) 21 2557 1136 [email protected] Suhaimi ILIAS [email protected] Osbert TANG, CFA • Property Chief Economist • Consumer • Poultry (852) 21 5096 8370 Singapore | Malaysia [email protected] Isnaputra ISKANDAR Woraphon WIROONSRI (603) 2297 8682 • Transport & Industrials (62) 21 2557 1129 (66) 2658 6300 ext 1560 [email protected] [email protected] [email protected] Philip TSE, CFA FRM • Metals & Mining • Cement • Banking & Finance Luz LORENZO (852) 2268 0643 [email protected] • Property & REITs Pandu ANUGRAH Philippines Jaroonpan WATTANAWONG (62) 21 2557 1137 (63) 2 849 8836 (66) 2658 6300 ext 1404 Ricky WK NG, CFA [email protected] [email protected] [email protected] (852) 2268 0689 [email protected] • Infrastructure • Construction • Transport • Utilities & Renewable Energy • Transportation • Small cap Tim LEELAHAPHAN Janni ASMAN Thailand Simon QIAN, CFA (62) 21 2953 0784 Chatchai JINDARAT (662) 658 1420 [email protected] (852) 2268 0634 [email protected] (66) 2658 6300 ext 1401 [email protected] • Cigarette • Healthcare • Retail [email protected] JUNIMAN • Telecom & Internet • Electronics Chief Economist, BII PHILIPPINES Indonesia Steven ST CHAN VIETNAM (62) 21 29228888 ext 29682 (852) 2268 0645 [email protected] Luz LORENZO Head of Research • Banking & Financials LE Hong Lien, ACCA [email protected] (63) 2 849 8836 [email protected] Head of Institutional Research Warren LAU • Strategy (84) 844 55 58 88 x 8181 Josua PARDEDE (852) 2268 0644 [email protected] Economist / Industry Analyst, BII [email protected] Laura DY-LIACCO • Strategy • Consumer • Diversified • Utilities Indonesia • Technology – Regional (63) 2 849 8840 (62) 21 29228888 ext 29695 [email protected] THAI Quang Trung, CFA, Deputy Manager, [email protected] William YANG • Utilities • Conglomerates • Telcos Institutional Research (852) 2268 0675 (84) 844 55 58 88 x 8180 trung.thai@maybank- MALAYSIA [email protected] Lovell SARREAL kimeng.com.vn • Technology – Regional (63) 2 849 8841 • Real Estate • Construction • Materials WONG Chew Hann, CA Head of Research [email protected] (603) 2297 8686 [email protected] INDIA • Consumer • Media • Cement TRUONG Thanh Hang • Strategy • Construction & Infrastructure (84) 844 55 58 88 x 8085 hang.truong@maybank- Jigar SHAH Head of Research Rommel RODRIGO kimeng.com.vn Desmond CH’NG, ACA (91) 22 6623 2601 (63) 2 849 8839 • Consumer (603) 2297 8680 [email protected] [email protected] • Conglomerates • Property • Gaming [email protected] • Oil & Gas • Automobile • Cement Le Nguyen Nhat Chuyen • Banking & Finance • Ports/ Logistics (84) 844 55 58 88 x 8082 chuyen.le@maybank- Anubhav GUPTA kimeng.com.vn LIAW Thong Jung Katherine TAN (91) 22 6623 2605 • Oil & Gas (603) 2297 8688 [email protected] (63) 2 849 8843 [email protected] • Oil & Gas - Regional • Shipping [email protected] NGUYEN Thi Ngan Tuyen, Head of Retail Research • Metal & Mining • Capital Goods • Property • Banks • Construction (84) 8 44 555 888 x 8081 ONG Chee Ting, CA Ramon ADVIENTO [email protected] (603) 2297 8678 [email protected] Urmil SHAH (63) 2 849 8845 • Food & Beverage • Oil&Gas • Banking • Plantations - Regional (91) 22 6623 2606 [email protected] [email protected] • Technology • Media • Mining NGUYEN Trung Hoa, Dy Head of Retail Research Mohshin AZIZ (84) 8 44 555 888 x 8088 (603) 2297 8692 [email protected] SINGAPORE THAILAND [email protected] • Aviation - Regional • Petrochem • Macro • Steel • Real estate NG Wee Siang Head of Research Maria LAPIZ Head of Institutional Research YIN Shao Yang, CPA (65) 6432 1467 [email protected] Dir (66) 2257 0250 | (66) 2658 6300 ext 1399 (603) 2297 8916 [email protected] • Banking & Finance TRINH Thi Ngoc Diep [email protected] (84) 4 44 555 888 x 8208 • Gaming – Regional • Media • Consumer / Materials Gregory YAP [email protected] TAN Chi Wei, CFA (65) 6432 1450 [email protected] • Technology • Utilities • Construction (603) 2297 8690 [email protected] • SMID Caps – Regional Jesada TECHAHUSDIN, CFA • Power • Telcos • Technology & Manufacturing • Telcos (66) 2658 6300 ext 1394 TRUONG Quang Binh [email protected] (84) 4 44 555 888 x 8087 WONG Wei Sum, CFA Wilson LIEW • Financial Services [email protected] (603) 2297 8679 [email protected] (65) 6432 1454 [email protected] • Rubber plantation • Tyres and Tubes • Oil&Gas • Property & REITs • Property Developers Kittisorn PRUITIPAT, CFA, FRM (66) 2658 6300 ext 1395 PHAM Nhat Bich ONG Kian Lin [email protected] LEE Yen Ling (84) 8 44 555 888 x 8083 (603) 2297 8691 [email protected] (65) 6432 1470 [email protected] • Real Estate • S-REITs [email protected] • Building Materials • Glove Producers • Consumer • Manufacturing • Fishery Sittichai DUANGRATTANACHAYA CHAI Li Shin James KOH (66) 2658 6300 ext 1393 (603) 2297 8684 [email protected] (65) 6432 1431 [email protected] NGUYEN Thi Sony Tra Mi [email protected] • Plantation • Construction & Infrastructure • Consumer - Regional (84) 8 44 555 888 x 8084 • Services Sector [email protected] YEAK Chee Keong, CFA KANG Chun Ee • Port operation • Pharmaceutical (603) 2297 8675 [email protected] (65) 6432 1460 Sukit UDOMSIRIKUL Head of Retail Research • Food & Beverage • Consumer [email protected] (66) 2658 6300 ext 5090 • Offshore & Marine [email protected] Ivan YAP Derrick HENG (603) 2297 8612 [email protected] Mayuree CHOWVIKRAN • Automotive (65) 6432 1446 [email protected] • Transport (Land, Shipping & Aviation) (66) 2658 6300 ext 1440 LEE Cheng Hooi Regional Chartist [email protected] (603) 2297 8694 WEI Bin • Strategy [email protected] (65) 6432 1455 [email protected] • Commodity • Logistics • S-chips Padon VANNARAT Tee Sze Chiah Head of Retail Research (66) 2658 6300 ext 1450 John CHEONG (603) 2297 6858 [email protected] [email protected] (65) 6432 1461 [email protected] • Strategy • Small & Mid Caps • Healthcare

March 21, 2014 5

SP Setia

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 sell 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 from 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 advice 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 contained 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”, “believe”, “estimate”, “intend”, “plan”, “expect”, “forecast”, “predict” and “project” and statements that an event or result “may”, “will”, “can”, “should”, “coul d” 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 solicit 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. MKE may, to the extent permitted by law, act upon or use the information presented herein, or the research or analysis on which they are based, before the material is published. One or more directors, officers and/or employees of MKE may be a director of the issuers of the securities mentioned in this report. 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 the 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 report. 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 Research 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 contact 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 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 Securities and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand 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 result, the survey may be changed after that date. Maybank Kim Eng Securities (Thailand) Public Company Limited (“MBKET”) does not confirm nor certify the accuracy of such survey result. Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of MBKET. MBKET accepts no liability whatsoever for the actions of third parties in this respect. US This research report prepared by MKE 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. All resulting transactions by a US person or entity should be effected through a registered broker-dealer in the US. 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. UK This document is being distributed by Maybank Kim Eng Securities (London) Ltd (“Maybank KESL”) which is authorized and regulated, by the Financial Services 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 for its comments or accuracy, and that access to such links is at the individuals own risk. Nothing in this re port should be considered as constituting legal, accounting or tax advice, and that for accurate guidance recipients should consult with their own independent tax advisers.

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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 material is issued and distributed in Singapore by Maybank KERPL (Co. Reg No 197201256N) which is regulated by the Monetary Authority of Singapore. Indonesia: PT Kim Eng Securities (“PTKES”) (Reg. No. KEP-251/PM/1992) is a member of the Indonesia Stock Exchange and is regulated by the BAPEPAM LK. 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 JSC (License Number: 71/UBCK-GP) 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 (Reg No: INF/INB 231452435) and the Bombay Stock Exchange (Reg. No. INF/INB 011452431) and is regulated by Securities and Exchange Board of India. KESI is also registered with SEBI as Category 1 Merchant Banker (Reg. No. INM 000011708) 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 Services 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 March 21, 2014, 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 March 21, 2014, 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 report.

Reminder Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to sophisticated 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.

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) 9 Temasek Boulevard 6/F, 20 St. Dunstan’s Hill 777 Third Avenue, 21st Floor 33rd Floor, Menara Maybank, #39-00 Suntec Tower 2 London EC3R 8HY, UK New York, NY 10017, U.S.A. 100 Jalan Tun Perak, Singapore 038989 50050 Tel: (44) 20 7621 9298 Tel: (212) 688 8886 Tel: (603) 2059 1888; Tel: (65) 6336 9090 Dealers’ Tel: (44) 20 7626 2828 Fax: (212) 688 3500 Fax: (603) 2078 4194 Fax: (65) 6339 6003 Fax: (44) 20 7283 6674

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 Level 30, Plaza Bapindo 2nd Floor, The International 16, 59000 Kuala Lumpur Three Pacific Place, 17th Floor Maharishi Karve Road, Tel: (603) 2297 8888 1 Queen’s Road East, Jl Jend. Sudirman Kav. 54-55 Churchgate Station, Fax: (603) 2282 5136 Hong Kong Jakarta 12190, Indonesia Mumbai City - 400 020, India

Tel: (852) 2268 0800 Tel: (62) 21 2557 1188 Tel: (91).22.6623.2600 Fax: (852) 2877 0104 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 Alex TSUN [email protected] [email protected] Tel: (65) 6336-5157 Tel: (852) 2268 0228 US Toll Free: 1-866-406-7447 US Toll Free: 1 877 837 7635 www.maybank-ke.com | www.maybank-keresearch.com

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