December 14, 2015

KOREA

Company News & Analysis Major Indices Close Chg Chg (%) CJ O Shopping (035760/Buy/TP: W254,000) KOSPI 1,927.82 -20.80 -1.07 Earnings matter more than valuation KOSPI 200 238.17 -2.18 -0.91 KOSDAQ 630.37 -23.11 -3.54 (030000/Buy/TP: W30,000) Acquisition of Lions baseball team Turnover ('000 shares, Wbn) Volume Value KOSPI 425,668 4,022 Sector News & Analysis KOSPI 200 66,404 2,706 Shipbuilding (Overweight) KOSDAQ 620,532 2,869 2016 Outlook Report Market Cap (Wbn) Value Consumer Discretionary (Overweight) KOSPI 1,221,052 2016 Outlook Report KOSDAQ 182,879 KOSPI Turnover (Wbn) Healthcare (Overweight) Buy Sell Net Healthcare Weekly Briefing Foreign 943 1,240 -296 Institutional 957 612 344 Economy & Strategy Update Retail 2,000 2,147 -147 Fixed Income Weekly KOSDAQ Turnover (Wbn) Buy Sell Net Bond market uncertainties to decrease after FOMC meeting Foreign 167 174 -7 Institutional 115 112 3 Retail 2,584 2,577 7

Program Buy / Sell (Wbn) Buy Sell Net KOSPI 1,029 941 88 KOSDAQ 108 78 30

Advances & Declines Advances Declines Unchanged KOSPI 150 697 32 KOSDAQ 131 964 27

KOSPI Top 5 Most Active Stocks by Value (Wbn) Price (W) Chg (W) Value 1,261,000 -23,000 282 KODEX LEVERAGE 9,500 -160 169 Hanmi Pharm 635,000 -25,000 134 KODEX INVERSE 8,405 60 130 KODEX 200 23,895 -205 126

KOSDAQ Top 5 Most Active Stocks by Value (Wbn) Price (W) Chg (W) Value NTPIA 2,630 605 113 AHNLAB 54,400 6,250 93 WSA 2,620 195 78 Komipharm 35,600 -3,650 71 Timo Technology 4,000 -165 68 Note: As of December 14, 2015

This document is a summary of a report prepared by Daewoo Securities Co., Ltd. (“Daewoo”) and published on our website. Please review the compliance notices contained in the original report. Information and opinions contained herein have been compiled in good faith from sources deemed to be reliable. However, the information has not been independently verified. Daewoo makes no guarantee, representation or warranty, express or implied, as to the fairness, accuracy or completeness of the information and opinions contained in this document. Daewoo accepts no responsibility or liability whatsoever for any loss arising from the use of this document or its contents or otherwise arising in connection therewith. Information and opinions contained herein are subject to change without notice. This document is for informational purposes only. It is not and should not be construed as an offer or solicitation of an offer to purchase or sell any securities or other financial instruments. This document may not be reproduced, further distributed or published in whole or in part for any purpose.

CJ O Shopping (035760 KQ) Earnings matter more than valuation

Retail Valuation has little significance at this point Two things need to be considered when investing in CJ O Shopping (CJOS) : valuation Company Update and earnings trajectory. From a valuation perspective, CJOS has become very attractive. December 14, 2015 Currently valued at W1.1tr, the company looks extremely cheap, given the W1tr in proceeds expected from the CJ HelloVision sale. But at this point, we believe increasing

valuation appeal will only serve as a floor for the stock price. In our view, what matters (Maintain) Buy more than valuation is a turnaround in earnings. Given weaker-than-anticipated revenue growth, we expect any meaningful turnaround Target Price (12M, W) 254,000 in earnings and shares to come after 1Q16. Due to portfolio restructuring, not only are gross merchandise sales (GMS) in the TV channel declining, but mobile GMS growth is Share Price (12/11/15, W) 183,600 also slowing down.

Expected Return 38% Earnings to remain weak until 1Q15, but full-year earnings to pick up in 2016

For 4Q15, we forecast non-consolidated GMS to remain flat YoY at W847.1bn and OP (15F, Wbn) 110 operating profit to decline 8.6% YoY to W33.2bn. For most of the year, profits have Consensus OP (15F, Wbn) 112 sharply declined on a combination of falling GMS and rising SG&A expenses (i.e., higher transmission fees and marketing spend). In 4Q15, however, the fall in GMS shou ld slow, EPS Growth (15F, %) -25.1 leading to a more moderate decline in profits. Market EPS Growth (15F, %) 22.5 P/E (15F, x) 15.1 Looking ahead to 2016, we estimate non-consolidated GMS and operating profit to Market P/E (15F, x) 11.2 expand 4.0% and 6.9% YoY to W3.25tr and W117.2bn, respectively. TV GMS should rise KOSDAQ 653.48 0.6% YoY, but mobile GMS should increase 20.4% YoY , driving overall GMS growth. On the expense side, we expect the SG&A ratio to modestly decline on the back of a slower Market Cap (Wbn) 1,140 increase in system operator transmission fees, the dissipation of herbal supplement Shares Outstanding (mn) 6 refund expenses, and a deceleration in promotional expenses. Free Float (%) 56.6 Foreign Ownership (%) 21.3 Looking at quarterly earnings, we see a slight decline in 1Q16, a strong pickup in 2Q16 Beta (12M) 0.11 amid an improved business environment, and modest growth in 3Q-4Q16. 52-Week Low 175,200 52-Week High 272,700 Maintain Buy and TP of W254,000

(%)(%)(%) 1M1M1M 6M6M6M 12M12M12M We view the CJ HelloVision sale as positive, given the overall cable market environment Absolute -2.8 -15.0 -28.6 (slowing growth and declining transmission income) and the price of the deal (which is Relative -0.7 -6.7 -41.3 more than double the book value of CJOS’s stake). CJ Group’s decision to drop out of the Coway bidding is also good news. However, we believe CJOS’s cash assets should be

160 CJ O Shopping KOSDAQ priced at a discount until the company can come up with an efficient way to use its 140 excess cash. We retain our Buy call and target price of W254,000, which reflects the 120 sum of 1) the value of earnings (non-consolidated), 2) the value of the Dongfang CJ 100 stake, and 3) the value of cash holdings and investment securities. 80

60 12.14 4.15 8.15 12.15

Daewoo Securities CCo.,o., Ltd. FY (Dec.) 12/12 12/13 12/14 12/15F 12/16F 12/17F Revenue (Wbn) 1,077 1,261 1,277 1,141 1,182 1,235 [Retail] OP (Wbn) 139 157 142 110 116 131

Aiden Lee OP margin (%) 12.9 12.5 11.1 9.6 9.8 10.6 +822-768-3297 NP (Wbn) 123 108 100 75 291 107 [email protected] EPS (W) 19,768 17,458 16,186 12,121 46,805 17,254 ROE (%) 30.1 20.9 16.7 11.3 35.1 10.6

P/E (x) 14.0 23.8 16.1 15.1 3.9 10.6 P/B (x) 3.6 4.4 2.5 1.6 1.2 1.1 Notes: All figures are based on consolidated K-IFRS; NP refers to net profit attributable to controlling interests Source: Company data, KDB Daewoo Securities Research estimates

Analysts who prepared this report are registered as research analysts in Korea but not in any other jurisdiction, includi ng the U.S. PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS IN APPENDIX 1 AT THE END OF REPORT.

Cheil Worldwide (030000 KS/Buy)

Acquisition of Samsung Lions baseball team Media ¢ Cheil Worldwide announced it will buy a 64.5% stake in the Samsung Lions on January 1st , 2016 Issue Comment ¢ The move is part of the company’s efforts to expand its sports business and boost December 14, 2015 domestic revenue growth

¢ Parent revenue to increase in 2016 on the back of sports club operations and Olympic- related marketing activities Daewoo Securities CCo.,o., Ltd.

[Telecom Service / Media] Cheil Worldwide to expand sports business and push up domestic revenue

Jee-hyun Moon Cheil Worldwide announced it will acquire a 64.5% stake in the Samsung Lions baseball team +822-768-3615 on January 1 st , 2016. The baseball team is a corporation, unlike other sports clubs under the [email protected] Samsung Group umbrella. Cheil Worldwide plans to purchase stakes from Samsung

Electronics (SEC), Samsung SDI, Samsung Electro-Mechanics (SEMCO), and Samsung C&T for W675mn, which should boost its stake in the Samsung Lions to 67.5%.

Samsung Lions (fiscal year end of November 30 th ) posted revenue of W51.1bn and a net loss

of W17.1bn in 2014, but turned to profit this year with revenue of W58bn and a net profit of W25.6bn (preliminary basis). This year’s earnings improvement was partly due to one-off gains from the sale of property to Samsung Life for W16.2bn in February. Looking ahead, the baseball team is expected to maintain breakeven-level earnings.

Cheil Worldwide’s decision to buy the Samsung Lions seems motivated by the firm’s intent to expand its sports business and boost domestic revenue growth. The decision does not come as a surprise, given that Jae-yeol Kim was appointed head of the company’s sports division last year. Since his appointment, Jae-yeol Kim has put major sports clubs under the umbrella of Cheil Worldwide, including the (football), Seoul Samsung Thunders (basketball), Yongin Samsung Life Blue Minx (women’s basketball), and Daejeon Samsung Bluefangs (volleyball). Cheil Worldwide’s domestic top-line growth has stagnated since 2014, when parent-based revenue fell to W871bn (vs. W927bn in 2013 and W854bn in 2012). The clubs should help boost revenue growth, from both sports club operations and related marketing revenues. The sports clubs acquired by Cheil Worldwide will continue to receive support from existing sponsors (affiliates) until they can be independently operated. Cheil Worldwide will likely manage earnings by integrating sports clubs operations and reinforcing marketing. Next season, the Samsung Lions will move to a new stadium, the Samsung Lions Park (25,000 seats). Cheil Worldwide plans to expand outdoor advertising activities using electronic displays and digital signage featuring the new stadium. The company also plans to attract packaged sponsorship by integrating the operations of its various sports clubs (baseball, football, volleyball, and basketball). The Samsung Lions acquisition will have a minimal impact on Cheil Worldwide’s financials, and thus should be a neutral issue in the short term. In the medium and long term, however, we expect the acquisition to contribute meaningfully to growth via expansion of sports marketing activities. In 2016, Cheil Worldwide’s sports marketing business will likely increase in importance, as the Rio Olympics (a major sponsor of which is SEC) will be held. Companywide, overseas businesses will be key to overall earnings growth, in our view. We maintain our Buy recommendation on Cheil Worldwide with a target price of W30,000.

FY ( Dec. ) 12/12 12/13 12/14 12/15F 12/16F 12/17F Revenue (Wbn) 2,365 2,709 2,666 2,846 3,051 3,276 OP (Wbn) 126 130 127 138 158 175 OP margin (%) 5.3 4.8 4.8 4.8 5.2 5.3 NP (Wbn) 94 99 102 106 120 132 EPS (W) 817 857 883 921 1,044 1,150 ROE (%) 13.6 14.7 13.2 12.4 13.5 13.0 P/E (x) 26.4 32.1 19.5 23.0 20.3 18.4 P/B (x) 3.1 3.5 2.0 2.2 2.0 1.8 Note: All figures are based on consolidated K-IFRS; NP refers to profit attributable to controlling interests Source: Company data, KDB Daewoo Securities Research estimates

Analysts who prepared this report are registered as research analysts in Korea but not in any other jurisdiction, including t he U.S. PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS IN APPENDIX 1 AT THE END OF REPORT.

Shipbuilding Shipbuilding to undergo seismic shift in 2016

Merchant ship/offshore plant orders to fall in 2016 amid lower oil prices Overweight (Maintain) In 2016, newbuilding is anticipated to decrease YoY, as lower oil prices and the economic slowdown continue to weigh on shipbuilding orders. Orders are projected to fall across 2016 Outlook Report all vessel types, except tankers. Meanwhile, newbuilding prices are unlikely to fall much, considering that 1) competition has eased following major industry restructuring, 2) November 30, 2015 price competition has decreased amid stricter ship financing policies, and 3) commodities’ slide should be limited going forward. Daewoo Securities Co., Ltd. Newbuilding orders for tankers are forecast to rise, as crude oil demand from Iran and India is likely to grow, and a large number of secondhand oil tankers used to store cheap [Shipbuilding & Machinery] crude oil will need replacing. Containership orders are forecast to decline, as the grace Ki-jong Sung period for the application of stricter environmental standards has ended, the world +822-768-3263 economy remains in the doldrums, and replacement demand has mostly been fulfilled. [email protected] And in spite of China’s subsidy extension, the bulk carrier segment should remain in a slump, in light of lower commodities demand, tonnage oversupply, and a low Baltic Dry Ho-seung Lee Index (BDI). The gas carrier market should contract, but at a modest pace thanks to +822-768-4176 growing gas demand around the globe. [email protected] The offshore plant market is unlikely to recover, as oil prices remain low. Moreover,

financial institutions drastically cut their investments in resource development amid the

plunge in commodity prices. Supermajors that have suffered earnings deteriorations are

not expected to make new investments for the time being, and are expected to limit investments to floating production systems (FPS) at some highly profitable oil wells. New drilling rig orders are unlikely to be placed. A recovery in offshore plants is anticipated to begin when the WTI price rises to US$60/bbl. For supermajors, crude oil and natural gas prices are the key consideration in initiating new investments.

Korean shipbuilders to undergo major restructuring in the coming year For Korean shipbuilders, 2016 will mark the onset of restructuring at an unprecedented scale, ushering in a whole new chapter in the industry’s history. The Japanese shipbuilding industry went through two rounds of major restructuring in the 1980s that cut the country’s shipbuilding capacity in half; those that survived are still alive and well today. Since 2008, around 75% of the world’s shipbuilders have either shut down or been sold to other companies, and global capacity has shrunk by more than 40%. The massive losses reported by large Korean shipbuilders this year necessitate structural changes in the coming year, including mergers and/or downsizing. After restructuring, the industry should bottom out as uncertainty lifts.

Maintain Overweight; Top picks are HHI and HMD We maintain our Overweight rating. The global shipbuilding market is likely to remain out of kilter next year, but some shipbuilding stocks that have pulled back amid heightened market uncertainty will likely bounce back to normal levels. But any rebound in merchant ship and offshore plant stocks should be limited due to a continued slump in the segment. We based our investment recommendation for each of the following stocks on earnings, order performance, extent of restructuring, and market uncertainty. Hyundai Heavy Industries (009540 KS/Buy/TP of W146,000) has fewer troubled projects compared to other top-tier peers, and it has strong financials. The firm is competitive in the merchant ship and offshore production system segments. Hyundai Mipo Dockyard (010620 KS/Buy/TP of W100,000) has started to turn around, and is likely to report stable earnings on recovery in orders. We maintain our Hold rating on (010140 KS) and Daewoo Shipbuilding & Marine Engineering (042660 KS) in light of heightened order uncertainty. We also reiterate Hold on Hanjin Heavy Industries & Construction (097230 KS), as the slow progress in asset sales (including real estate) should keep the shipbuilders’ financial burden high. Analysts who prepared this report are registered as research analysts in Korea but not in any other jurisdiction, including the U.S. PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS IN APPENDIX 1 AT THE END OF REPORT.

Consumer Discretionary China, consumption, and the post-80s generation

China entering consumer-driven growth Overweight (Maintain) China, once considered the world’s factory, can no longer be counted on to drive global 2016 Outlook Report industrial demand now that the rapid development of the secondary industry has come to an end. As a percentage of China’s GDP, the tertiary industry surpassed the secon dary November 30, 2015 industry for the first time in 2012, and the gap has been widening ever since. And in 2013, consumption became the main driving force of China’s economic growth. Now, all

Daewoo Securities CCCo.,Co., Ltd. eyes are on China’s consumer-driven economy and its potential impact on the glob al market. [Cosmetics, Hotel/Leisure, Fashion] 30-somethings and discretionary goods will be the main drivers Regina Hahm +822-768-4172 In Korea, consumption trends are led by the so-called “echo generation,” those in their [email protected] early to mid-30s born between 1979 and 1985. Similarly, China’s consumption is driven

Chiyoung Park by young consumers born in the 1980s known as the “post-80s generation.” In most +822-768-4156 societies, consumers in their early to mid-30s are often the main driving force of [email protected] consumption trends, as they have a higher propensity to spend compared to other age groups beca use employment, marriage, and childbirth typically take place during that

age.

The post-80s generation currently forms the backbone of China’s working population and is expected to drive overall consumption and structural trends. Born during the country ’s rapid industrialization, they grew up in a more affluent environment compared to previous generations. We believe these young consumers, who are more quality conscious, will power the growth of consumer discretionary industries, such as education and entertainment.

Only companies with proven track records will benefit In our view, China’s past (up until 2010), present, and future should be viewed from different standpoints. Today’s core consumers are proving to be much more sophisticated and sensiti ve to trends. Given their complexity and fickleness, we believe Chinese consumers need to be approached from both a bottom-up and top-down perspective.

In our view, China does not present an opportunity for everyone. Only companies that have proven their relative and absolute competitiveness over the years in broader Asia should be able to meaningfully take advantage of this opportunity.

Over the long term, we see the biggest opportunity in cosmetics. Cosmetics companies can utilize various channels to penetrate into the Chinese market, and major brands are particularly well positioned given their strong omni-channel capabilities. We also expect Korea’s share in China’s outbound travel market to continuously increase. Korea’s duty- free market, which is the most advanced in the region, should play a key role in capturing the growth of Chinese outbound tourists, for whom shopping is a top priority.

In 2016, we believe the cosmetics/personal care sector offers the strongest momentum in relation to Chin a consumption, followed by tourism and fashion. As our top picks, we recommend AmorePacific (090430 KS/Buy/TP: W580,000), LG Household & Health Care (051900 KS/Buy/TP: W1,250,000), and (008770 KS/Buy/TP: W174,000), which we believe are best positioned to benefit from the rise of China’s post-80s consumers.

Analysts who prepared this report are registered as research analysts in Korea but not in any other jurisdiction, including t he U.S. PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS IN APPENDIX 1 AT THE END OF REPORT.

Healthcare (Overweight/Maintain)

Healthcare Weekly Briefing

1. Major issues and events Sector Update December 11, 2015 MOTIE honors top exporters (December 7 th )

On December 7 th , as part of the 52 nd Annual Trade Day celebration, the Ministry of Trade, Industry and Energy (MOTIE) honored 1,328 companies for recording robust exports. Daewoo Securities CCo.,o., Ltd. Fourteen healthcare firms were among those honored (combined exports: ofUS$700mn). [Healthcare] For example, Celltrion Healthcare and Hanmi Pharmaceutical were recognized for recording Hyun-tae Kim US$3mn and US$1mn in exports, respectively. +822-768-3251 [email protected] Celltrion Healthcare was the first healthcare firm to reach the US$3mn mark. We anticipate

Seung-min Kim robust exports of Remsima, the company’s flagship product (rheumatoid arthritis; a biosimilar +822-768-4157 for Remicade) in 2016. [email protected] Table 1.1. KoKorearea’’ss top exporters (healthcare sector) TableTable 11. KKoorearea ’’s top exporters (healthcare sector) Company Company size Milestone Business areas Distribution, Celltrion Healthcare Large US$300mn in exports marketing Hanmi Pharmaceutical Large US$100mn in exports Pharmaceuticals Yuhan Chemical Medium US$100mn in exports API Suheung Capsule Medium US$70mn in exports Capsules ST Pharm Medium US$70mn in exports API Korea Otsuka Pharmaceutical Large US$30mn in exports Pharmaceuticals Medytox SME US$20mn in exports Biologics Daehan New Pharm SME US$10mn in exports Animal drugs Sam Chun Dang Pharm SME US$5mn in exports Pharmaceuticals Dae Hwa Pharm SME US$5mn in exports Pharmaceuticals Sung Kwang Pharm SME US$3mn in exports Pharmaceuticals Shin Hwa Pharm SME US$1mn in exports Oriental medicine Shin Won Pharmacy SME US$1mn in exports Wholesale Inist Biopharma SME US$1mn in exports Pharmaceuticals Source: MOTIE, press, KDB Daewoo Securities Research

Analysts who prepared this report are registered as research analysts in Korea but not in any other jurisdiction, including tthehe U.S.

PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS IN APPENDIX 1 AT THE END OF REPORT.

Fixed Income Weekly Bond market uncertainties to decrease after FOMC meeting

December FOMC: US rate hike likely to lead to fall in global yields

The looming US rate hike, which has weighed on the global bond market in 2015, is widely expected to finally take place at the December FOMC meeting slated for this Fixed Income Report week. And the Fed’s posture in the aftermath of the meeting will likely be a key December 14, 2015 determinant of market movements. We expect Fed Chair Janet Yellen t o make dovish comments after the meeting in light of 1) unfavorable global economic conditions, 2)

Daewoo Securities CCo.,o., Ltd. the burden associated with adopting a direction contrary to other countries’ policies , and 3) the weakening US corporate environment. [Fixed Income] In 2004, the Fed raised the federal funds rate at every FOMC meeting after its initial hike Yeo-sam Yoon in June (the first in more than four years). However, the 10-year UST yield remained +822-768-4022 below the level seen just after the first hike for a full year. We expect U ST yields to show [email protected] a similar pattern going forward. The upcoming FOMC meeting should sharply decrease

uncertainties in the bond market. Reflecting such expectations, the 10-year UST yield plunged 10bps to 2.13% at the end of last week.

Domestic economy facing growing downside risk; Yields likely to peak As expected, the BOK exhibited an easing stance at the December MPC meeting. And, i n light of the dismal global economic recovery and lower oil prices, the bank seems set to trim its growth forecast at next month’s MPC meeting. If key negatives emerge (e.g., corporate restructuring, a smaller contribution of government spending to growth, etc.) the BOK may view easing as necessary.

As mentioned above, the 10-year UST yield plunged to 2.13% at the end of last week . Despite the imminent hike in the federal funds rate, bond buying increased as improvements in US economic data lost steam and oil continued to slide.

Now that even US bond yields have plummeted ahead of the potential rate hike, we expect the domestic bond market to be strong. And if the Fed hints that it will take it slow after cutting the rate in December, US rate policies are unlikely to become an obstacle to Korea’s monetary easing. In addition, we do not believe the househol d debt issue will be a priority for the BOK in determining policy. We maintain our projection that a base rate cut will come around March 2016.

US nominal growth rate and 10Y USTUST/fed/fed funds rate spread

(%) (%p) 10 US nominal growth (L) 10Y UST/fed funds rate spread (R) 5

8 4

6 3

4 2

2 1

0 0

-2 -1

-4 -2 90 92 94 96 98 00 02 04 06 08 10 12 14 16

Source : US BEA, Bloomberg, KDB Daewoo Securities

Analysts who prepared this report are registered as research analysts in Korea but not in any other jurisdiction, including t he U.S. PLEASE SEE ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES & DISCLAIMERS IN APPENDIX 1 AT THE END OF REPORT.

Key Universe Valuations December 14, 2015

※All data as of close December 11, 2015, unless otherwise noted.

16F Earnings growth Mkt Cap Price P/E (x) P/B (x) ROE (%) Ticker Company Div Yield OP EPS (Wbn) (W) (%) 16F 17F 16F 17F 16F 17F 16F 17F 16F 17F 005930 Samsung Electronics 185,744 1,261,000 2.2 2.2 5.1 5.3 7.6 9.8 9.1 1.0 0.9 11.7 11.4 005380 Hyundai Motor 33,152 150,500 3.3 15.6 -1.2 12.6 1.1 5.7 5.7 0.6 0.6 11.4 10.5 015760 KEPCO 31,745 49,450 3.0 8.3 0.5 -46.9 -1.5 4.7 4.8 0.4 0.4 9.8 8.9 012330 Hyundai Mobis 23,655 243,000 1.4 15.0 7.2 22.5 5.8 6.3 5.9 0.8 0.7 13.4 12.6 090430 AmorePacific 23,471 401,500 0.3 33.4 31.0 25.2 31.7 35.8 27.2 6.7 5.5 20.6 22.3 000270 Kia Motors 21,727 53,600 2.5 27.7 14.0 25.8 10.9 5.8 5.2 0.8 0.7 14.2 13.9 051910 LG Chem 21,406 323,000 1.2 17.6 33.5 35.9 34.2 13.7 10.2 1.6 1.4 12.6 15.0 000660 SK Hynix 21,112 29,000 1.4 -21.9 10.7 -22.9 11.3 6.3 5.7 0.8 0.7 14.1 13.8 032830 Samsung Life 21,100 105,500 - - - - 0.0 0.0 035420 NAVER 20,865 633,000 0.2 33.3 22.4 35.7 21.6 28.2 23.2 5.3 4.4 27.7 26.0 018260 Samsung SDS 20,118 260,000 0.2 12.2 1381.5 8.3 1338.7 41.9 2.9 4.1 1.7 10.1 82.3 055550 Shinhan Financial Group 19,276 40,650 - - - - 0.0 0.0 017670 SK Telecom 18,733 232,000 4.3 4.8 1.4 0.4 1.8 11.3 11.1 1.0 1.0 10.1 9.7 034730 SK Holdings 17,731 252,000 0.8 9.0 13.4 4.3 -49.4 20.8 41.1 3.2 3.0 19.8 8.9 051900 LG Household & Health Care 15,400 986,000 0.5 21.6 16.8 22.7 18.6 29.6 25.0 6.6 5.4 25.7 24.4 033780 KT&G 15,102 110,000 3.3 -4.9 0.7 -9.4 2.0 15.8 15.5 2.1 2.0 14.7 13.9 000810 Samsung F&M 14,544 307,000 - - - - 0.0 0.0 005490 POSCO 14,342 164,500 4.9 10.9 11.3 593.2 33.2 9.8 7.3 0.3 0.3 3.5 4.6 105560 KB Financial Group 13,213 34,200 - - - - 0.0 0.0 003550 LG Corp. 12,252 71,000 1.4 8.3 0.0 5.2 2.1 11.2 11.0 0.9 0.8 8.2 7.8 096770 SK Innovation 11,281 122,000 2.0 -34.7 48.8 -29.1 58.6 14.7 9.3 0.7 0.6 4.7 7.2 006400 Samsung SDI 8,802 128,000 0.8 468.2 5.0 385.4 -81.4 5.8 31.1 0.7 0.7 12.3 2.2 034220 LG Display 8,588 24,000 2.1 -40.9 85.2 -43.9 110.7 13.9 6.6 0.7 0.6 4.9 9.7 035250 Kangwon Land 8,322 38,900 3.3 11.5 5.2 14.7 9.5 16.2 14.8 2.4 2.2 16.4 16.4 010130 Korea Zinc 8,237 436,500 1.5 22.0 16.2 23.5 17.4 12.4 10.5 1.4 1.3 12.4 13.0 010950 S-Oil 8,162 72,500 3.8 -8.9 15.1 0.0 15.1 10.9 9.5 1.4 1.3 13.2 13.8 011170 Lotte Chemical 7,952 232,000 0.4 7.6 12.6 19.0 16.8 6.2 5.3 0.9 0.8 15.8 15.8 066570 LG Electronics 7,839 47,900 1.7 58.8 19.7 146.9 21.0 9.0 7.5 0.7 0.6 7.6 8.6 030200 KT 7,585 29,050 2.8 1.1 0.3 -13.4 4.2 10.1 9.7 0.6 0.6 6.5 6.4 047810 Korea Aerospace Industries 7,496 76,900 0.3 27.7 23.5 42.2 26.2 24.8 19.7 5.0 4.0 22.1 22.7 024110 Industrial Bank of Korea 7,345 13,200 - - - - 0.0 0.0 086280 Hyundai Glovis 7,181 191,500 1.0 9.5 8.4 57.8 2.4 12.3 12.1 2.0 1.8 17.6 15.6 086790 Hana Financial Group 7,163 24,200 - - - - 0.0 0.0 023530 Lotte Shopping 7,054 224,000 0.9 12.1 12.9 57.4 14.1 14.4 12.6 0.4 0.4 2.8 3.2 001800 Orion 6,986 1,169,000 0.6 14.8 8.2 23.0 13.5 33.3 29.4 4.3 3.9 14.1 14.2 009540 Hyundai Heavy Industries 6,764 89,000 - 123.3 - 724.4 124.5 15.1 0.4 0.4 0.4 3.1 021240 Coway 6,563 85,100 4.2 11.8 21.2 9.6 21.3 17.9 14.8 4.3 3.9 28.1 30.2 088350 Hanwha Life 6,523 7,510 - - - - 0.0 0.0 004020 Hyundai Steel 6,512 48,800 1.5 6.8 9.9 7.6 31.6 7.4 5.6 0.4 0.4 5.6 6.9 128940 Hanmi Pharmaceutical 6,497 635,000 63.1 28.5 73.0 36.4 102.3 74.9 11.7 10.1 12.1 14.5 035720 Kakao 6,490 108,000 0.2 92.2 38.3 76.3 40.8 41.2 29.3 2.4 2.2 6.0 7.9 161390 Hankook Tire 5,822 47,000 1.0 7.1 14.0 7.7 14.9 8.1 7.1 1.0 0.9 12.8 13.0 009240 Hanssem 5,542 235,500 0.4 44.2 27.9 41.7 32.7 33.7 25.4 8.7 6.6 32.1 31.7 139480 Emart 5,408 194,000 0.8 21.2 13.5 -24.0 12.3 12.4 11.0 0.7 0.7 6.0 6.3 009150 Samsung Electro-Mechanics 5,131 68,700 0.9 25.4 29.0 240.2 32.7 19.7 14.8 1.1 1.0 6.0 7.5 036570 NCSOFT 4,835 220,500 1.7 29.6 21.8 34.4 24.9 18.6 14.9 2.7 2.4 16.5 18.1 078930 GS Holdings 4,609 49,600 2.7 -8.5 17.6 17.1 28.9 8.2 6.4 0.5 0.4 5.9 7.2 002380 KCC 4,592 436,500 2.1 1.2 5.1 56.3 4.6 20.3 19.4 0.7 0.7 3.7 3.8 005830 Dongbu Insurance 4,588 64,800 - - - - 0.0 0.0 032640 LG Uplus 4,541 10,400 2.8 2.0 1.8 5.4 4.8 10.5 10.1 0.9 0.9 9.2 9.0 Source: KDB Daewoo Securities Research

Market Data December 14, 2015

※All data as of close December 14, 2015, unless otherwise noted.

Other Major Indices Economic Indicators Close Net Chg 1D (%) YTD (%) Close 1D ago 1M ago 1Y ago MSCI Korea* 354.04 0.11 0.03 -8.44 USD/KRW 1,179.70 1,177.50 1,154.50 1,098.10 KOSPI 1,927.82 -20.80 -1.07 0.07 JPY100/KRW 974.39 968.14 941.57 923.39 KOSDAQ 630.37 -23.11 -3.54 13.84 EUR/KRW 1,294.54 1,288.77 1,248.30 1,362.14 Dow Jones* 17,265.21 -309.54 -1.76 -3.18 3Y Treasury 1.73 1.75 1.78 2.11 S&P 500* 2,012.37 -39.86 -1.94 -2.23 3Y Corporate 2.15 2.16 2.15 2.44 NASDAQ* 4,933.46 -111.71 -2.21 4.37 DDR2 1Gb* 1.09 1.09 1.11 1.35 Philadelphia Semicon* 660.78 -13.45 -1.99 -3.78 NAND 16Gb* 1.46 1.46 1.50 2.25 FTSE 100* 5,952.78 -135.27 -2.22 -9.09 Oil (Dubai)* 36.20 36.51 42.59 61.57 Nikkei 225 18,902.11 -328.37 -1.71 8.58 Gold* 1,076.90 1,073.10 1,084.90 1,225.10 Hang Seng* 21,464.05 -240.56 -1.11 -10.03 Customer deposits (Wbn)* 20,735 20,322 22,053 15,201 Taiwan (Weighted) 8,040.16 -75.73 -0.93 -13.31 Equity type BC (Wbn)(Dec. 10) 79,748 79,802 80,682 78,347 Note: * as of December 11, 2015 Source: KSDA, Wisefn, DRAMeXchange, MSCI

KOSPI Top 10 Foreign Net Buy / Net Sell (Wbn) KOSPI Top 10 Institutional Net Buy / Net Sell (Wbn) Net Buy Net Sell Net Buy Net Sell LG Display 7.70 Samsung Electronics 125.18 Samsung Electronics 70.79 KODEX LEVERAGE 49.01 Hyundai Motor 5.74 Samsung Electronics (P) 31.27 Hyundai Mobis 20.28 AmorePacific 9.09 AmorePacific 5.63 POSCO 28.97 POSCO 19.61 CJ CGV 6.00 CJ CGV 5.57 NHN 18.83 NHN 17.57 SK Energy 5.87 S-Oil 5.21 LG Chem 18.81 Hyundai Motor 17.27 S-Oil 5.41 Honam Petrochemical 4.98 Shinhan Financial Group 12.82 SAMSUNG C&T 14.56 Hanmi Pharm 3.36 KOREA AEROSPACE 4.77 SK Telecom 10.27 Kia Motors 12.95 TIGER WTI Futures 3.00 SAMSUNG SDS 4.72 KB Financial Group 9.47 LG Chem 12.75 Hanwha Chemical 2.30 Kia Motors 3.70 Hyundai Steel 7.79 KODEX INVERSE 12.55 Doosan Corp. 2.26 Glovis 2.98 SAMSUNG C&T 7.24 Shinhan Financial Group 11.48 MERITZ SECU 2.16 Source: KSDA, Wisefn

KOSDAQ Top 10 Foreign Net Buy / Net Sell (Wbn) KOSDAQ Top 10 Institutional Net Buy / Net Sell (Wbn) Net Buy Net Sell Net Buy Net Sell Komipharm 6.36 Daum Communications 5.17 Bio Space 4.71 AHNLAB 3.32 Medy-tox 4.88 Binex 2.78 ISPLUS 4.67 Binex 3.21 OSSTEM IMPLANT 3.34 KEBT 2.72 KEBT 2.75 Medy-tox 2.67 Huons 2.51 Caregen 2.39 Com2us 2.30 Daum Communications 2.16 Celltrion 2.04 CrucialTec 2.29 EO Technics 1.97 1.98 Seoul Semiconductor 1.44 Bio Space 1.96 ViroMed 1.96 OSSTEM IMPLANT 1.95 Innocell 1.34 Partrion 1.44 Celltrion 1.65 Eugene Corporation 1.68 GemVax 1.25 CJ E&M 1.27 Nexturn 1.54 TERA SEMICON 1.54 Interpark 1.20 INICIS 1.01 KREIT 1.46 Huons 1.43 KH Vatec 1.16 KREIT 0.99 Tes 1.40 DoubleUGames 1.22 Source: KSDA, Wisefn

KOSPI Top 10 by Market Cap (Wbn) KOSDAQ Top 10 by Market Cap (Wbn) Close (W) Chg (W) Mkt Cap Close (W) Chg (W) Mkt Cap Samsung Electronics 1,261,000 -23,000 185,744 Celltrion 78,200 -400 8,780 Hyundai Motor 150,500 2,000 33,152 Daum Communications 108,000 -4,700 6,490 KEPCO 49,450 850 31,745 CJ E&M 82,600 -1,900 3,199 SAMSUNG C&T 144,000 -3,000 27,315 Dongsuh 30,350 -750 3,026 Samsung Electronics (P) 1,062,000 -20,000 24,249 Medy-tox 442,700 3,200 2,504 Hyundai Mobis 243,000 8,500 23,655 ViroMed 164,000 -10,000 2,328 Amore Pacific 401,500 -1,500 23,471 LOEN 76,500 -2,800 1,935 Kia Motors 53,600 1,400 21,727 Komipharm 35,600 -3,650 1,928 LG Chem 323,000 -3,500 21,406 Paradise 17,400 -700 1,582 Hynix 29,000 -850 21,112 Com2us 109,000 -3,800 1,402 Source: Korea Exchange