Deutsche Bank Markets Research

Europe Periodical Date Germany 9 April 2013 Made in Germany Special Report

Lars Slomka, DVFA Jan Rabe Strategist Strategist German SMEs: Investing in the sweet- (+49) 69 910-31942 (+49) 69 910-31813 [email protected] [email protected] spot of corporate Germany

Benjamin Kohnke Uwe Schupp, CFA The purpose of this report is to help investors navigate the German small and Research Analyst Research Analyst medium-sized enterprise (SME) equity universe under Deutsche Bank (+49) 69 910-31943 (+49) 69 910-31955 coverage, with a market capitalisation up to E5bn. The investment case for [email protected] [email protected] German SMEs is highly attractive, in our view, and we recommend Compugroup, Duerr, LEG, MorphoSys, Schaltbau AG, Tom Tailor and United Value added growth among EU SMEs (2008-11) Internet as our key picks. We also screen German SMEs for investable themes and further highlight CTS Eventim, Draegerwerk AG, GEA and Wincor Nixdorf. Investment case: trends appear and vanish, but values persist (1) The structural case: Ten years ago, Germany was considered the “sick man of Europe”. Its economy was mired in recession, while the rest of Europe was recovering; its unemployment rate was higher than the Euro area average and was violating the European budget rules by running excessive deficits. A decade later, Germany is considered a role model for everyone else. One of the key strengths of the German economy is the significant economic value added by small and mid-cap enterprises (SMEs). The majority are family-owned, are often characterised by their concentration on profitable niche market segments or premium segments of mass markets, their technology-based product leadership as well as their close customer relationships. This profile helps them avoid head-to-head competition with global giants. (2) The fundamental case: Our analysis reveals that overall, German SMEs have a sounder financial base than their European peers, with less leverage, higher net interest cover and lower dependence on external financing. In addition, German SMEs generate higher returns on capital, despite a significantly lower level of investments in fixed assets, pointing towards higher capital efficiency. This combination of elements has enabled German SMEs to recover much more strongly from the 2008/09 economic downturn than most European SME peers (see top-right chart). A stronger top-line and more robust operating margins among German SMEs relative to European (ex Germany) peers translated into a superior EPS growth profile over the past decade, and we expect this trend to continue, in line with our analysts’ bottom-up estimates. German SMEs in aggregate trade at a 2014E P/E of 13.8x vs. European (ex Germany) peers at 12.2x – a discount to the 10-year structural premium (see pages 06-17). Investable screens: German SMEs reflected in a broad range of vantage points We focus on key investment themes, looking at German SMEs with a focus on family businesses, exporters, momentum plays and regional exposure. We have also prepared screens that could be of special interest to conservative, style and income investors (see pages 41-49). Due to the heterogeneous composition of Source: European Commission, Deutsche Bank individual business models within these themes, we recommend approaching them via selective stock-picking and highlight Buy-rated stocks with an intact German SME key picks business case and significant upside implied by our analysts target prices. In Price & DB Recommendation this regard, our top-down picks CTS Eventim, Draegerwerk AG, GEA and Wincor Nixdorf appear frequently and should be considered by investors interested in German SMEs (see Figure 1 on page 05 in the executive summary). Mcap Price TP Upside Company name Rec. (EUR bn) (EUR) (EUR) (%) Our key picks among German SMEs: “The Magnificent Seven” We provide an overview of the most important sectors among German listed Compugroup Buy 853 17.0 23.0 35 SMEs, i.e. Automobiles & Parts, Consumer & Retail, Mechanical Engineering, Duerr Buy 1,366 78.9 95.0 20 LEG Buy 2,148 40.6 48.5 20 Pharma & HC/Biotech, Real Estate and TMT (Technology, Media and Telcos) Morphosys Buy 714 31.0 43.0 39 (see pages 34-40). Our key bottom-up picks, which we believe are well Schaltbau Holding Buy 194 31.5 38.0 21 positioned to outperform the broader market, are: Compugroup, Duerr, LEG, Tom Tailor Buy 379 17.2 19.0 10 MorphoSys, Schaltbau AG, Tom Tailor and United Internet (see bottom right United Internet Buy 3,753 19.4 22.0 14 table and pages 19-33 for details). The basket offers 20% upside potential from current price levels and trades at a discount to the German SME universe based Source: Datastream, Deutsche Bank Estimates on average (median) 2014E P/E of 10.8x (10.1x). ______Deutsche Bank AG/London Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1. MICA(P) 072/04/2012.

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Made in Germany Special Report

Table Of Contents

Executive summary ...... 3 Key findings ...... 3 1 Introduction: trends appear and vanish, but values persist ...... 6 1.1 German SMEs: investing in the corporate sweet-spot ...... 6 1.2 German SMEs’ innovation-driven competitiveness stands out in European comparison . 8 1.3 Technology and knowledge-intensity enable German SMEs to over-proportionally grow value-added ahead of European peers ...... 12 1.4 Financial structure and refinancing of German SMEs in European comparison: disarming a critical argument ...... 14 1.5 P&L review: superior EPS strength comes at a premium ...... 17 2 How to approach it ...... 19 2.1 German SME top picks: Our preferred Buy ideas ...... 19 2.2 German SME sector focus: identifying the most relevant spots ...... 34 2.3 Investable themes (top-down screenings) ...... 41 Appendix A ...... 50 Market data chart book ...... 50 A.1 Key economic indicators ...... 51 A.2 Performance ...... 52 A.3 Earnings ...... 53 A.4 Consensus recommendation momentum ...... 54 A.5 Directors’ Dealings ...... 55 A.6 Traditional valuation ...... 56 A.7 Index agglomerations ...... 58 Appendix B ...... 60 Q1 2013 reporting calendar ...... 60 Appendix C ...... 65 Companies mentioned list ...... 65

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Executive summary

Key findings

The purpose of this report is to help investors navigate the German small and medium- sized enterprise (SME) equity universe under Deutsche Bank coverage, with a market capitalisation up to E5bn. Key elements of the report include a detailed investment case, stock ideas as well as investable themes and screenings.

1) German SMEs at the vanguard of innovation-driven businesses in Europe: Backed by a high share of the technology-intensive labour force, German SMEs tend to be the most innovative in Europe and enable the German economy to stand out in an international comparison. Characteristics attributable to listed German SMEs can be derived from “Mittelstand” companies, which are known for their concentration on profitable niche market segments and/or the premium segments of mass markets, their technology-based product leadership and their close customer relationships. Their long- term strategic business orientation supports the identification of these niches, thereby enabling the overall export-led economy to defend a strong global position, comprising the majority of world market leaders across industries (see pages 8-11 for details).

2) German SMEs are based on a sounder financial basis relative to European peers: One of the more negative facets of SMEs in general has been their financing structure. SMEs are more reliant on bank loans, compared to large caps which have access to corporate bond markets. The stronger dependency on bank loans can be a serious concern in times of financial distress. However, we find that German SMEs are generally well funded and access to funding is not an issue. In aggregate, German SMEs have a sounder financial base compared to European peers with lower leverage, a higher net interest cover and lower dependency on external financing, as they have managed to increase their equity ratio in excess of European peers. Moreover, German SMEs overall generate higher returns on capital, despite a significantly lower level of investment in fixed assets, pointing towards higher capital efficiency (see pages 14-16 for details).

3) Stronger operational gearing boosts EPS over-proportionally: Finally, we observe that German SMEs are characterised by a significantly stronger top line and more robust operating margins which has translated into a superior EPS growth profile over the past decade (2003-2012). In line with our analysts’ bottom-up forecasts, we expect this trend to continue going forward (see page 17 for details).

How to approach it (1): German SME top picks – our preferred Buy ideas We have identified Compugroup, Duerr, LEG, MorphoSys, Schaltbau AG, Tom Tailor and United Internet as our key picks among German SMEs; we believe these companies are well positioned to outperform the broader market going forward (see pages 19-33 for details).

How to approach it (2): German SME sector focus – identifying the most relevant spots Most of the listed German SME companies are concentrated in six sectors, i.e. Automobiles & Parts, Consumer/Retail, Mechanical engineering, Pharma & HC/Biotech, Real Estate and TMT (Technology, Media and Telcos). We highlight the most important common drivers in each sector and analyse investor positioning to help readers identify the most interesting themes and Buy ideas from a top-down perspective (see pages 34- 40 for details).

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How to approach it (3): screening for investable themes (top-down perspective) We focus on key investable themes relevant to the international investor base, looking at German SMEs with a focus on family businesses, exporters, momentum plays and regional exposure. We have also prepared screens that could be of special interest to conservative, style and income investors:

ƒ Family businesses: One of the most prominent themes among the German SME equity universe in the past has been the selection of “family businesses”. We recommend being selective and highlight CompuGroup, CTS Eventim, Draegerwerk, Duerr, Gerry Weber, Jungheinrich, QSC, SMA, Software AG, Tom Tailor, United Internet as our key picks in this basket (see page 42 for details). ƒ Exporters: Next to the investment theme of “family businesses”, the screen of “exporters” among corporate Germany is one of the most frequently-requested ones. Fundamentally, we believe it is the one with the greatest upside from the current level and highlight Aixtron, Draegerwerk, GEA and MTU as key picks among German SME exporters (see page 43 for details). ƒ Momentum plays: We screened the German SME universe for “Fallen Angels” (i.e. out-of-favour stocks poised for a rebound or buying opportunities) and “Falling Angels” (i.e. out-of-favour consensus Buys or selling opportunities). Based on this screening, we recommend owning Air Berlin, Heidelberger Druck and highlight Fielmann, Delticom as Sells (see pages 44-45 for details). ƒ Regional exposure: We sorted the German SME equity universe for the Top 20 companies with revenue exposure to their home country (Germany), rest of Europe (Europe ex Germany), the Americas and to Asia/Pacific (see pages 45-46 for details). ƒ Designed for conservative investors: Conservative investors could be interested in owning stocks that 1) offer a high return on equity, 2) are subject to low volatility and 3) can be bought at a reasonable price. In this regard, we highlight Duerr, Wincor Nixdorf, Gerry Weber, CompouGroup, CTS Eventim, United Internet and Hugo Boss as key names (see page 47 for details). ƒ Designed for style investors: We screened the German SME universe for “Value” and “Growth” stocks and conclude that we prefer “Growth” over “Value” in the mid-term (>12 months forward) based on the market cap weighted upside implied by our analysts’ target prices. Buy-rated “Growth” stocks with significant upside potential to our analysts’ target prices include comdirect, MTU, ProSiebenSat.1, PSI AG and Software AG (see pages 47-49 for details). ƒ Designed for income investors: We screened the German SME equity universe for two dividend themes, i.e. “sustainable dividends” and “current dividend yield attractiveness”. Within the “sustainable dividend” screen, Hugo Boss is the only Buy-rated stock with significant upside implied by our analyst’s target price. Among the “current dividend yield attractiveness” screen we highlight CEWE Color, CTS Eventim, Duerr, GEA, QSC and Wincor Nixdorf as key picks (see page 49 for details).

Appearance of key picks and other Buy-rated stocks across screens Figure 1 highlights all Buy-rated stocks within our German SME equity universe under Deutsche Bank coverage which appear in screenings highlighted in this report. Aside from our key bottom-up picks mentioned above, we note that CTS Eventim, Draegerwerk AG, GEA and Wincor Nixdorf appear numerous times from a top-down perspective and could be of interest to investors looking at German SMEs.

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Zooplus x

Wincor Nixdorf Wincor x

VTG x

TUI

Tipp24

Stroeer

Stada Arzneimittel Stada

Software AG Software x

SMA

SHW

SFC Energy SFC

Sartorius

QSC

Qiagen

PSI

ProSiebenSat.1

Praktiker

MTU

Jungheinrich

Hugo Boss Hugo xx

Heidelberger Druck Heidelberger xx xx x

GSW Immobilien GSW xxx x

Gerry Weber Gerry x xx

GEA

Freenet

Fraport

Draegerwerk AG Draegerwerk xxxx x

CTS Eventim CTS

comdirect xxxxx

CEWE Color CEWE xxxxx

Brenntag

BB Biotech BB

Alstria

Aixtron xxx xxxx

Air Berlin Air xxx xx x x x x x xxx

ADVA x

Aareal Bank Aareal xxxxxxx xxxx United Internet United

ocks across investable themes and screens within this report xxx xx x xxxxxxx Tom Tailor Tom

xx

Schaltbau Holding Ag Holding Schaltbau Morphosys

xxxxxx LEG

xxxxx Duerr

x xxxxxx x x x xxx x xxxxxxx xxxx xxxx x x x x xx Compugroup Medical AG Medical Compugroup xxxx xxxxxxx xx x x x x x xx x Key picks among German SMEs German among picks Key TP our to upside significant with report this in mentioned SMEs German Buy-rated noteworthy Other Momentum plays (1): "FallenAngels" Momentum plays (2): "Falling Angels" (pages 44-45) (pages 44-45) Thematic (2): Exporter basket (page 43) Screen themes Investable Thematic (1): Family basket (page 42) Reference Salesexposure Domestic (1): Germany(>75%) (pages 45-46) Sales exposure Europe GER (2): ex (>35%) (pages 45-46) Salesexposure Asia/Pacific (3): (>25%) (pages 45-46) Salesexposure Americas (4): (>25%) (pages 45-46) Performance (2): Weakestrelative perf.YTD 2013 (pageEPS revisions 52) (1): Strongest EPS 1M upgrades (page 53) Descriptive screens Performance (1): Strongestrelative perf. 2013 YTD (page 52) Conservative screenDividends (2): Current yield attractivness (page 49) (page 47) Style (1): Value screen (pages 47-48) Style (2): Growth screenDividends (1): Sustainable DPS screen (page 49) (pages 47-48) EPS revisions(2): Strongest EPS 3M upgrades (page 53) EPS revisions(3): Strongest EPS 1M downgradesEPS revisions(4): Strongest EPS 3M downgrades (page 53) (page 53) Cons. Highest rec. (1): (IBES) cons. rec. scoreCons. rec. (3): Highest (page m-o-m (+) 54) chg. in the scoreCons. rec. (4): Highest m-o-m (-) chg. (page in the score 54) Directors' (pageDealings Buy transactions (1): 54) Directors' transactionsDealings Sell (2): (page 55) (page 55) Cons. rec. (2): Lowest (IBES) cons. rec. score (page 54) Valuation (1):Lowest P/E ratio (2013E)Valuation (2): Highest P/B ratio (2013E) (page 56) (page 56) Valuation (3): Lowest P/B ratio (2013E)Valuation (4): Lowest EV/EBITDA ratio (2013E)Valuation (5): Highest EV/EBITDA ratio (2013E) (page 56) (page (page 56) 56) Figure 1: Appearance of our key picks and other Buy-rated st

Source: DeutscheBank

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1 Introduction: trends appear and vanish, but values persist

In this section, we provide investors with an introduction to the characteristics of investing in the German small and mid cap enterprise (SME) universe under Deutsche Bank coverage.

1.1 German SMEs: investing in the corporate sweet-spot

One of the key strengths of the German economy is the significant economic value added by small and mid-cap companies, of which the majority are family-owned and often characterised by their concentration on profitable niche market segments and/or the premium segments of mass markets, their technology-based product leadership and their close customer relationships. This strategy helps them avoid head-to-head competition with global giants. “Don't dance where the elephants play” is a favourite ‘Mittelstand’ slogan. Although the term ‘Mittelstand’ is sometimes applied to quite small, parochial firms, the most interesting ones are somewhat bigger and more outward-focused. Listed German MDax, SDax and TecDax companies below a certain market capitalisation threshold are also often recognised as ‘Mittelstand’ companies for sharing the same values as non-listed ‘Mittelstand’ companies with sales below E1bn and fewer than 500 employees. Typically, ’Mittelstand’ values include a strong corporate culture with close cooperation between employers and employees, attention to detail, discrete customer relations and financial caution, amongst others. The corporate governance structure of family-owned businesses usually contrasts with that of multinational large cap companies run by external managers with only limited affinity to the ideals and traditions of the business. These structures are often much more capable of preventing principal-agent issues from arising. The majority of these companies also tend to approach business opportunities with a long-term perspective, to generate sustainable returns on invested capital and equity. This long-term orientation certainly helped them overcome the 2009 recession, as well as the recent period of slowing economic growth within Europe. Long-term orientation may also be supportive of the identification of niches and the gaining of a strong global position, which is reflected in Germany’s No.1 rank among the number of industries in which it occupies a No.1, 2 or No. 3 position (see Figure 2). Figure 2: Germany ranks No.1 as world market leader Figure 3: German world market leaders aggregated by across industry sectors globally (2007) industry sectors (2010)* Number of top positions Number of market % of all No. Aggregated industry sector % of total segments with market 1 Mechanical engineering and plant manufacturing 30% Rank Country No.1 No.2 No.3 a Top 3 position segments 2 Consumption & commodity goods 13% 3Industrial goods & services 13% 1 Germany 67 40 35 142 61% 4 Electrical engineering 8% 5 Car suppliers 8% 2 China 72 19 16 107 46% 6Pharma & medical engineering 6% 3 USA 34 37 26 97 42% 7 Construction 5% 8 Chemicals 4% 4Italy5 2726 58 25% 9 Commodities 3% 5 Japan 10 21 19 50 22% 10 Food & Beverages 3% 11 High-technologies 3% 6France5 9 17 31 13% 12 Trade & commerce 2% 13 Miscellaneous 1% 7UK388 198% 14 Media 1% 15 Software 1% Source: International Cluster Competitiveness Project (ICCP), Institute for Strategy and Competitiveness, * Database German Global Market Leaders, calculations made by Prof. Dr. Bernd Venohr Harvard Business School Source: Manager Magazin (October 2010)

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World market leaders identified across German small and mid-cap companies with annual revenues of up to EUR1bn account for c40% of all German exports. Around 90% of the identified German world market leaders relate to production sectors and 70% are represented by family businesses. The majority of these companies relate to the Mechanical engineering sector followed by Consumption & Commodity goods and Industrial Goods & Services (see Figure 3). Interestingly, it can be shown that world market leadership positions among German small and mid-cap companies are indeed sustainable over the long-run (see Figure 4).

Figure 4: Sustainability of world market leadership among Figure 5: German exports of goods and services (as % of German small-/ and mid-cap companies GDP) in international comparison 60 250 Total number of companies covered by the survey)

50 200 40 60% maintainedtheir 150 131 position 30

218 20 100 18% maintainedtheir 39 position, but lost their 10 independant status 50 22% lost their position 0 48 (insolvency/ restructuring) 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 1994 2009 Germany EU United States United Kingdom Japan Source: “Hidden Champions”, Simon, H. (2010). Source: Eurostat, Deutsche Bank calculations

Moreover, it is well known that the German economy has benefitted from global integration via rising exports over recent decades. In the recent decades of economic liberalisation, German companies have been able to turn their domination of German market niches into strong international market leadership. The US has four times as many Fortune Global 500 companies as Germany; Japan twice as many, and even France has more. Yet the export strength of these countries is far below Germany’s. Measuring exports relative to domestic value added reveals that Germany by far outpaces its major peers in the developed market world (see Figure 5).

At the root of Germany’s continuing export success are small and mid-sized companies. For example, the average export ratio (share of revenues generated abroad) of the largest family-owned businesses in Germany reached 39% during 2008-2011 and therefore exceeds that achieved by all German companies in 2010 (18%). The higher export ratio of family-owned businesses in Germany indicates a strong international standing, based on competitive and well positioned products/services. Many of these companies have benefitted from global integration well beyond exports, i.e. by “exporting” their successful business models, implementing industry standards and setting up production sites abroad to benefit from 1) the proximity of markets in need of specialist, best-in-class products, and also from 2) cheap labour in Eastern Europe and Asia. The concept of successfully “exporting the business model” is supported by many factors including strong brands, high market barriers to entry and the ability to “localise” a global product.

In many cases, the growth profiles of German small and mid-cap companies are predominantly driven by organic rather than external growth (via acquisitions), led by an innovative and entrepreneurial character with the intention to be a benchmark for competitors and industries globally instead of following trends.

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1.2 German SMEs’ innovation-driven competitiveness stands out in European comparison

The quality of the platform a country offers for its corporate environment is predominantly relevant for companies with a strong global orientation, such as for the export-oriented German economy, which is constituent to the third of three economic development stages, i.e. the “innovation-driven” stage (first stage: factor-driven; second stage: efficiency-driven). At this stage, companies must compete by producing new and different goods through new technologies and/or the most sophisticated production processes or business models.

As SMEs in Germany represent c.99% of all companies and account for c.40% of total employment as well as for c.1/3 of the German economy’s total valued added (2011), we can argue that SMEs account for a large share of the German economy’s competitiveness, and thereby underscore the commonly-known saying that “SMEs represent the backbone of the German economy”.

In this regard, we find it useful to review the World Economic Forum’s ‘Global Competitiveness Report’ which analyses competitiveness among 144 countries globally based on three major categories (i.e. basic requirements, efficiency enhancers and innovation), 12 sub-pillars and 123 variables. Based on the findings in the latest 2012/2013 report, Germany ranked 6th in the composite score, which comprises results from the three major categories. Figure 6 and Figure 7 below present the composite rank for the German economy in a global comparison (the lower, the more competitive a country is relative to peers), while Figure 9 to Figure 11 highlight details within the three major categories in more detail.

The report concludes, “Germany is ranked an excellent 3rd for the quality of its infrastructure, boasting in particular first-rate facilities across all modes of transport. The goods market is quite efficient, characterised by intense local competition (8th rank) and low market dominance by large companies (2nd). Germany’s business sector is very sophisticated, especially when it comes to production processes and distribution channels, and German companies are among the most innovative in the world, spending heavily on R&D (4th) and displaying a high capacity for innovation (3rd) – traits that are complemented by the country’s well-developed ability to absorb the latest technologies at the firm level (16th). These attributes allow Germany to benefit greatly from its significant market size (5th), which is based on both its large domestic market and its strong exports. […]. In view of continued economic difficulties in the euro area, Germany’s performance in the macroeconomic pillar remains remarkably stable.”

This strong economic set-up, in combination with 1) a Euro currency which is too weak for the economy’s export strength/global position relative to other Euro member states, 2) a comfortable refinancing environment (see section 1.4 below), and 3) a sustainable world market leadership in the majority of global sector segments (as outlined above), underscores our structurally positive view on the German economy as a whole as well as its SME base – a significant driver of the economy’s overall strong global competitive position. According to the European Commission’s regular fact-findings across member countries, Germany hosts the best-performing SME sector in the EU in terms of the numbers of jobs provided and the value-added created over past years.1

1 See European Commission (2012): “SBA Fact Sheet 2012 – Germany”.

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Figure 6: Global competitiveness ranks over time Figure 7: Global competitiveness ranks (2012/13 report)

Rank (a lower rank represents a better respective competitive position) 80 70 60 50 40 30 20 10 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Germany US UK Japan China Brazil Russia India

Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank

Figure 8: European competitiveness ranks over time Figure 9: Germany, category 1 (basic requirements)

Rank (a lower rank represents a better respective competitive position) Rank (a lower rank represents a better respective competitive position) 100 80 90 70 80 70 60 60 50 50 40 40 30 30 20 20 10 10 0 0 2006 2007 2008 2009 2010 2011 2012 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Basic requirements (1) Institutions Germany France Italy Spain Infrastructure Macroeconomic environment Greece Ireland Portugal Netherlands Health and primary education

Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank

Figure 10: Germany, category 2 (efficiency enhancers) Figure 11: Germany, category 3 (innovation)

Rank (a lower rank represents a better respective competitive position) Rank (a lower rank represents a better respective competitive position) 80 10 70 9 8 60 7 50 6 40 5 30 4 3 20 2 10 1 0 0 2006 2007 2008 2009 2010 2011 2012 2006 2007 2008 2009 2010 2011 2012 Efficiency enhancers (2) Higher education and training Innovation, sophistication factors (3) Business sophistication Goods market efficiency Labor market efficiency Innovation Financial market development Technological readiness Market size

Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank

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According to the European Commission’s ‘Innovation Union Scoreboard 2013’, Germany is the most innovative country among EU member countries after Sweden and is classified as an innovation-leader within Europe (i.e. 20% or more above that of the EU27 average)2 . The most interesting finding within Europe, in our view, is the clear “north-south-divide” where the Nordics (ex Norway) and core European countries rank on top, above the EU27 average, while Greece, Portugal, Spain and Italy rank below the EU27 average (Figure 12). This observation not only reflects the current status quo but also the past years, and we observe not too much has changed over time (Figure 13).

Figure 12: EU Member States’ innovation index 2012* Figure 13: Relative country delta (in %) vs. EU27 average

0.80 % above (below) the EU27 average 0.75 60 0.70 0.65 40 2006 0.60 2007 0.55 20 0.50 2008 0.45 0 2009 0.40 2010 0.35 (20) 2011 0.30 (40) 2012 UK Italy Spain NL EU 27 EU UK France Ireland Finland Greece Italy Norway Sweden Portugal Spain Denmark Germany France Ireland Finland Greece Norway Sweden Portugal Netherlands Denmark Germany Source: European Commission (‘Innovation Union Scoreboard 2013’) Source: European Commission (‘Innovation Union Scoreboard 2010-2013’)

The report also finds that Germany’s innovative position is increasingly driven by SMEs (see Figure 14) and stands out in European comparison (see Figure 15).

Figure 14: Innovation index vs. SME innovators index* Figure 15: SME innovators index* landscape

* Consists of indicators for SMEs introducing product/process/marketing/organisational innovations. * Consists of indicators for SMEs introducing product/process/marketing/organisational innovations. Source: European Commission (http://ec.europa.eu/enterprise/archives/ius2013/IUS2013.html) Source: European Commission (http://ec.europa.eu/enterprise/archives/ius2013/IUS2013.html)

2 The Innovation Union Scoreboard 2013 gives a comparative assessment of the innovation performance of the EU27 Member States and the relative strengths and weaknesses of their research and innovation systems. It monitors innovation trends across the EU27 Member States, as well as. The measurement framework used in the Innovation Union Scoreboard distinguishes between 3 main types of indicators and 8 innovation dimensions (i.e. human resources, research systems, finance and support, firm investments, linkages and entrepreneurship, intellectual assets, innovators, economic effects), capturing 24 different indicators (performance is measured using a composite indicator building on data for 24 indicators going from a lowest possible performance of 0 to a maximum possible performance of 1). The overall ambition of the Innovation Union Scoreboard is to inform policy discussions at national and EU level, by tracking progress in innovation performance within and outside the EU over time.

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Findings from the European Commission’s report indicate that the foundation for an innovation-driven German economy can be found in the nexus between highly innovative downstream businesses with a close tie to upstream companies – a critical element to technological progress and high innovation rates in many German industrial sectors. For example, the close cooperation between the German automotive supplier industry (mainly SMEs) and the large original equipment manufacturers (OEMs) is one reason for the technological leadership of the sector globally. The automotive suppliers thus support the high competitiveness of German OEMs in all the important car markets. Also, a high degree of flexibility allows German SME to adapt rapidly to new technological developments and diverging economic developments.

During the 2008/09 economic downturn, investors feared German SMEs would be cut off from financing and would therefore have to scale back R&D spending at the expense of future earnings growth (direct), and this would have negative spill-over effects on relative competitiveness among upstream businesses relying on SMEs’ innovative strengths (indirect).

This, however, was countered by the German government’s initiative to promote a concentrated innovation programme especially focused on German “Mittelstand” companies. Government-backed R&D programmes for SME companies predominantly focused on the IT and Mechanical Engineering sectors between 1999-2008 (see Figure 16) as well as between 2004-2010 (see Figure 17).

Figure 16: R&D support through PRO INNO (1999-2008) Figure 17: R&D support through PRO INNO II (2004-2010)

IT 18.0% IT 18.6%

Mechanical engineering 12.4% Mechanical engineering 14.2%

Personal services 10.2% Architecture 7.7%

Architecture 7.2% Metal products 6.1%

Metal products 5.5% Services (IT) 3.6%

Other goods 3.7% Rubber & Plastics 3.3%

0% 5% 10% 15% 20% 0% 5% 10% 15% 20%

Share of completed projects* Share of completed projects*

* PRO INNO: Data relates to projects completed during 1999-2008 (6,289 projects in total). * PRO INNO: Data relates to projects completed during 2004-2010 (7,552 projects in total). Source: ZMI, Deutsche Bank Source: ZMI, Deutsche Bank

The intent was 1) to sustainably strengthen SMEs’ R&D efficiency, 2) to support the transition of innovative products from creation to market introduction, 3) to enhance the products’ technical as well as economical potential, and 4) to secure/establish qualified jobs. With the support of these programmes, participating German SME companies managed to 1) strengthen revenue streams, 2) secure highly qualified jobs, 3) significantly shorten R&D cycles and 4) improve competitive advantages via advanced technological knowhow related to core businesses, leading to a more efficient use of input factors.

In turn, the success of such programmes is also well reflected in the general perception of the German economy as an innovation-driven platform capable of providing a solid basis for domestic companies to successfully lever their business models globally and to sustain leadership in (specialised) niche markets, as outlined above.

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1.3 Technology and knowledge intensity enable German SMEs to over-proportionally grow value-added ahead of European peers

As competitiveness often refers to the set of institutions, policies and factors that determine the level of productivity of a country, we find that a relatively high share of technology and knowledge-intensive employment helps explain the diverse recovery development of value-added among EU member states since the 2008/09 downturn. In terms of sectoral distribution, Germany’s SME sector closely resembles the EU average, with one important exception: the relative importance of hi-tech manufacturing SMEs in Germany clearly stands out from the EU average. More than 34,000 SMEs (18%) are engaged in high-tech or medium- to high-tech activities, as opposed to only 12% in the EU. The difference is also reflected in its share of total SME employment and value- added creation, where Germany is ahead of the EU average, with 27% (EU: 21%) and 36% (EU: 30%), respectively. Most of the difference is accounted for by the medium- to high-tech segment. Interestingly, on the services side there is no difference between Germany and the rest of the EU. The proportion of SMEs providing knowledge-intensive services of the total number of SMEs is largely comparable between Germany and the EU as a whole. About 27% of German SMEs are engaged in knowledge-intensive sectors, accounting for 24% of total SME employment and 29% of gross value-added. Of these, only a very small number — 4% of all SMEs — are involved in high-tech activities, employing 4% of the German SME workforce and contributing 7% to total gross value-added of German SMEs.

Figure 18: Growth in gross value added (GVA) of SMEs Figure 19: Growth in gross value added (GVA) of SMEs (sorted by manufacturing technology intensity) (sorted by knowledge intensity) Gross value added (GVA) growth of SMEs, 2008-2011 Gross value added (GVA) growth of SMEs, 2008-2011 20% 20% Germany Germany 10% 10% France Portugal 0% 0% Portugal France (10%) Greece (10%) UK UK Italy Spain Spain Greece (20%) (20%) Italy y = 0.0252x - 0.1805 y = 0.0139x - 0.2985 (30%) (30%)

(40%) (40%) 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 7.5 10.0 12.5 15.0 17.5 20.0 22.5 25.0 27.5 % share of HMHTM SME employment in total SME employment, 2011 % share of KIS SME employment in total SME employment, 2011

Source: European Commission, Deutsche Bank presentation Source: European Commission, Deutsche Bank presentation

Figure 18 and Figure 19 present this positive relationship between gross value-added growth in the manufacturing sector and 1) technology intensity on the one hand and 2) knowledge intensity on the other hand based on the European Commission’s ‘Annual report on small and medium-sized enterprises in the EU’. In Figure 18 EU member states are ranked by technology intensity in 2011 on the x-axis and plotted against their growth of real value added of SMEs from 2008 until 2011 on the y-axis. Technology intensity is indicated by the share of high-tech and medium-high-tech manufacturing (HMHTM) employment in total SME employment.3

3 High-tech and medium-high-tech manufacturing (HMHTM) sectors include basic pharmaceutical products and pharmaceutical preparations, computer, electronic and optical products, chemicals and chemical products, electrical

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In Figure 19 we present the same, based on EU member states ranked by the share of knowledge-intensive service (KIS) SMEs in total SME employment on the x-axis.4

The European Commission’s report shows the average growth rate of gross value added by SMEs in EU member states that have above-average HMHTM shares during 2008-2011 is higher than the EU average and that of the group of Member States with below average HMHTM SME shares. SME employment in countries with above-average HMHTM shares during 2008-2011 declined by less than the EU average. This contrasts with the group of countries with below-average HMHTM SME shares, which experienced more unemployment than the EU27 in aggregate. In a nutshell, countries with higher shares of SME employment in high-tech and medium-high-tech manufacturing sectors tend to show a better performance in terms of real value-added growth than others. The same holds true for KIS shares (albeit Germany ranks closer to the EU average relative to the HMHTM SME shares).

Figure 20: Value added growth among SMEs from 2008-11 across EU members (in %)

15 10 5 0 -5 -10 -15 -20 -25 -30 -35 UK Italy EU27 Spain Malta Latvia Ireland France Poland Austria Cyprus Finland Greece Estonia Bulgaria Slovakia Sweden Belgium Portugal Slovenia Hungary Lithuania Germany Denmark Netherlands Luxembourg Czech RepublicCzech

Employment growth + Value-added per person (productivity) growth = Growth in Value-added

Source: European Commission, Deutsche Bank presentation

It can be further shown that value-added growth of a country can be decomposed by employment growth and productivity growth (see Figure 20).5 Applying this methodology to the 27 EU member states reveals that German SMEs developed strongly on the back of employment growth from 2008-2011 and weathered the crisis much better than most of their peers elsewhere in the EU. The strong economic recovery also substantially improved the funding environment among German SMEs. There was a significant improvement in the share of SMEs that reported a deterioration in the willingness of banks to provide loans (down from 27% to 16% with the EU average only down from 30% to 27% in 2011 yoy). The share of rejected loan applications/unacceptable loan offers also dropped – from 26% to only 8% (much more than the EU average which declined from 22% to 15% in 2011 yoy).

equipment, manufacture of machinery and equipment, manufacture of motor vehicles, trailers and semi-trailers and manufacture of other transport equipment. 4 Knowledge-intensive services include programming and broadcasting activities, telecommunications, computer programming, consultancy and related activities, information service activities, financial and insurance activities, legal and accounting activities, management consultancy activities, architectural and engineering activities among others. 5 See Uppenberg, K. (2011): „Economic growth in the US and the EU: A sectoral decomposition“, EIB Papers 02/2011, European Investment Bank, Luxembourg.

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1.4 Financial structure and refinancing of German SMEs in European comparison: disarming a critical argument

One of the more negative facets of SMEs in general has been their financing structure. SMEs are more reliant on bank loans compared to large caps, which have more favourable access to corporate bond markets – as is the case among German-listed companies (compare Figure 21 to Figure 26). The stronger dependency on bank loans can be a serious concern in times of financial distress.

Figure 21: Financing sources (EUR bn) of the Dax30^ Figure 22: Financing mix of the Dax30*

1,200 9% 1,014 1,000

800 24% Bonds 600 Bank Loans 352 400 237 Commercial Paper 200 83 32 67% 0 Total Interest Bonds Bank Loans Commercial Liabilities Bearing Debt Paper

^The figure is based on FY 2011 data. *The figure is based on FY 2011 data and represents the share of interest bearing debt. Source: Capital IQ, Deutsche Bank calculations Source: Capital IQ, Deutsche Bank calculations Figure 23: Financing sources (EUR bn) of the MDax50^ Figure 24: Financing mix of the MDax50*

250 225 0%

200

150 Bonds 48% Bank Loans 100 52% 43 Commercial Paper 50 21 23 0 0 Total Interest Bonds Bank Loans Commercial Liabilities Bearing Debt Paper

^The figure is based on FY 2011 data. *The figure is based on FY 2011 data and represents the share of interest bearing debt. Source: Capital IQ, Deutsche Bank calculations Source: Capital IQ, Deutsche Bank calculations Figure 25: Financing sources (EUR bn) of the SDax50^ Figure 26: Financing mix of the SDax50*

30 0% 24 25 24%

20 Bonds 15 Bank Loans 10 9 7 Commercial Paper

5 2 0 76% 0 Total Interest Bonds Bank Loans Commercial Liabilities Bearing Debt Paper

^The figure is based on FY 2011 data. *The figure is based on FY 2011 data and represents the share of interest bearing debt. Source: Capital IQ, Deutsche Bank calculations Source: Capital IQ, Deutsche Bank calculations

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The lack of funding to SMEs in the Euro area is clearly at the heart of the ECB’s thinking at the current juncture, as it is a clear and persistent sign that policy transmission remains significantly impaired. While the ECB’s ‘Bank Lending Survey’ (Q1’13) provides only little evidence of “discrimination” against SME lending vs. large cap lending, we find clear evidence in the ‘Access to Finance Survey’, as well as in the growing spread between the interest rate charged to very small businesses and non-financial corporations, that SMEs are specifically limited in their access to external funding in Italy and Spain, while no such pattern can be observed in France and Germany. Given a pick-up in demand for credit among German SMEs (see Figure 27), the ECB’s ’Bank Lending Survey (BLS)’ on Germany reveals credit supply constraints are not an issue at the moment, as indicated by the stable net percentage of banks surveyed reporting no tightening of credit standards on a quarter-on-quarter basis in Q1 2013 (see Figure 28).

Figure 27: ECB’s BLS on German SMEs (demand side) Figure 28: ECB’s BLS on German SMEs (supply side)

(net percentage) (net percentage) 70 Q1'13e 70 increase Q1'13e 50 50 tightened 30 30 10 10 -10 -10 decrease -30 -30 eased -50 -50 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Small/mid firms credit demand over the past 3 months (t) Credit standards for small/mid firms over the past 3 months (t) Expected credit demand for small/mid firms 3 months ahead … Expected credit standards for small/mid firms 3 months ahead (t+1) Source: ECB Bank Lending Survey Q1 2013, Deutsche Bank presentation Source: ECB Bank Lending Survey Q1 2013, Deutsche Bank presentation

Over recent years, German-listed SMEs have raised their average equity ratio substantially, from 33% in 2004 to 37% in 2011 and, thus, have become less dependent on external financing. German-listed SMEs increased their equity ratios in excess of European (ex Germany) peers (see Figure 29). One main reason for the considerable improvement in capital levels is likely to have been increased requirements by banks. With the introduction of Basel II, capital requirements for corporate loans became more differentiated according to the level of risk, i.e. loans to lower-rated borrowers have to be backed by more equity now and are therefore more expensive. Companies, for their part, had an incentive to strengthen their balance sheets to reduce financing costs.

Figure 29: Equity ratio among German and Europe (ex Figure 30: Debt ratio among German and Europe (ex Germany) SMEs Germany) SMEs (Equity ratio [Total shareholders' capital/Total assets], in %) DB forecast (Debt ratio [Interest bearing debt/Total assets], in %) DB forecast 42.5 35.0 40.0 32.5 37.5 30.0 27.5 35.0 25.0 32.5 22.5 30.0 20.0 27.5 17.5 25.0 15.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2013E 2014E Germany* Europe (ex Germany)* Germany* Europe (ex Germany)* Source: Company data, Deutsche Bank estimates Source: Company data, Deutsche Bank estimates

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There is much to suggest that the increase will continue for the time being, as our analysts expect the ratio to increase to 41% in 2014 for German SMEs. Nevertheless, there are certain signs that the trend is levelling off going forward. The currently good earnings situation of many companies may favour a further increase. However, the extremely low interest rate level, which encourages higher leverage, may have the opposite effect, as does the declining importance of bank loans for corporate funding. This lower dependence on credit institutions also reduces the pressure of having a good credit rating via a high capital ratio.

Aggregating leverage (net debt/equity) and net interest cover (operating EBIT/net interest expenses) for German as well as for Europe (ex Germany) SMEs, reveals that German SMEs have a sounder financial base with lower leverage, and a higher net interest cover in addition to lower dependency on external financing.

Figure 31: German SMEs are less levered relative to Figure 32: …accompanied by a higher a higher net Europe (ex Germany) SMEs… interest cover ratio (Net debt/equity, in %) DB forecast (Net interest cover, x) DB forecast 90.0 8.0 80.0 7.0 70.0 6.0 60.0 5.0 50.0 4.0 40.0 3.0 30.0 20.0 2.0 10.0 1.0 0.0 0.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2013E 2014E Germany* Europe (ex Germany)* Germany* Europe (ex Germany)* Source: Company data, Deutsche Bank estimates Source: Company data, Deutsche Bank estimates

Moreover, German SMEs generate higher returns on capital (see Figure 33) despite a significantly lower level of investment in fixed assets (see Figure 34), pointing towards higher capital efficiency.

Figure 33: German SMEs generate a superior return on Figure 34: ...despite a significantly lower level of capital relative to Europe (ex Germany) SMEs… investments in fixed assets (Return on Capital, in %) DB forecast (Capex/sales, in %) DB forecast 16.0 9.0 14.0 8.0 12.0 7.0 6.0 10.0 5.0 8.0 4.0 6.0 3.0 4.0 2.0 2.0 1.0 0.0 0.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2013E 2014E Germany* Europe (ex Germany)* Germany* Europe (ex Germany)* Source: Company data, Deutsche Bank estimates Source: Company data, Deutsche Bank estimates

In a nutshell, we believe the most frequently-raised concern against investing in German SMEs, from a fundamental point of view, is not as critical as is often stressed and particularly not in a European comparison.

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1.5 P&L review: superior EPS strength comes at a premium As P&L metrics vary strongly from sector to sector as well as from region to region, we focus on the historical development including 2013/14 estimates instead, in order to make the performance of German vs. European (ex Germany) SMEs comparable. We observe a significantly stronger operational gearing among German SMEs relative to European (ex Germany) peers given a stronger top line and more robust operating margins, which translated into a superior EPS growth profile over the past decade (2003-2012). Going forward, we expect this trend to continue, in line with our analysts’ bottom-up forecasts.

Figure 35: Key profit & loss (P&L) components Figure 36: Valuation ratios

1) Sales development 1) Price-to-earnings ratio (P/E) (Sales development based on % change yoy, 2003=100) DB forecast (P/E ratio, x) DB forecast 29.8x 170 25.0 160 20.0 150 140 15.0 130 10.0 120

110 5.0 100 90 0.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2013E 2014E Germany* Europe (ex Germany)* Germany* Europe (ex Germany)*

2) EBIT margin development 2) Price-to-book ratio (P/B) (P/BV ratio, x) DB forecast (EBIT margin development based on pp change yoy, 2003=100) DB forecast 3.0 105 104 2.5 103 102 2.0 101 1.5 100 99 1.0 98 97 0.5 96 0.0 95 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E Germany* Europe (ex Germany)* Germany* Europe (ex Germany)*

3) Price-to-cash flow per share ratio (P/CFPS) 3) EPS development (P/CFPS ratio, x) DB forecast (EPS development based on % change yoy, 2003=100) DB forecast 14.0 300 12.0 250 10.0 200 8.0 150 6.0 100 4.0

50 2.0

0 0.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2013E 2014E Germany* Europe (ex Germany)* Germany* Europe (ex Germany)*

Source: Company data, Deutsche Bank estimates Source: Company data, Deutsche Bank estimates

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2 How to approach it

In this section we highlight our key picks among German SMEs under Deutsche Bank coverage (section 2.1), review key trends and stock ideas within the most important sectors (section 2.2) and present relevant investable themes and styles (section 2.3).

2.1 German SME top picks: Our preferred Buy ideas

Overview CompuGROUP Medical AG (COPMa.DE, Buy, target price: E23.0) (pages 20-21) CompuGROUP is one of the leading providers of software solutions for the healthcare sector in Germany, other European countries and Turkey (18 countries in total). According to company surveys, approximately 240,000 doctors/dentists use CompuGROUP's software solutions globally. In the doctor information systems business for doctors in private practice in Germany alone, CompuGROUP’s market share, measured by the number of installations with relevant doctors for the company, is approximately 43% and it is approximately 44% among dentists. Duerr (DUEG.DE, Buy, target price: E95.0) (pages 22-23) Duerr engineers/builds plants and manufactures machinery for the automotive industry in Europe, North/South America and Asia. Duerr designs and constructs fully-automatic paint finishing plants, final assembly systems, and air purifier and water treatment systems. Duerr also produces computerised, camera-controlled production robots. LEG (LEGn.DE, Buy, target price: 48.5) (pages 24-25) LEG is a well-managed residential property pure play on NRW. Following its financial and operational restructuring, LEG offers stable and predictable cash flows with rent increases, modernisation and external growth by consolidating the NRW market. MorphoSys (MORG.DE, Buy, target price: E43.0) (pages 26-27) Although shares in MorphoSys have almost doubled in the past year, we continue to see excellent risk/reward in the name with multiple sources for a similar re-rating (or more). With the focus set to shift back on the pipeline and numerous potential positive catalysts ahead, we consider the current level a particularly attractive entry point. Schaltbau AG (SLTG.DE, Buy, target price: E38.0) (pages 28-29) Germany-based Schaltbau is a leading manufacturer of components and systems for the transportation and capital goods industries. It operates in three business segments: Mobile Transportation Technology, Stationary Transport Technology, and Components. It has a widespread product portfolio including door systems for trains and buses/coaches, signalling and safety technology for rail infrastructure, and industrial brakes, as well as electrical components for an extensive number of applications. Tom Tailor (TTIGn.DE, Buy, target price: E19.0) (pages 30-31) TTI's expansion in the retail and wholesale business, the firm’s focus on the middle income group along with an increasing focus on women's wear in the product mix and pricing power and operating leverage, should act as positive triggers in the near term. United Internet (UTDI.DE, Buy, target price: E22.0) (pages 32-33) United Internet (UI) is a technology holding company offering telecommunication services in Germany under its 1&1 brand (DSL and mobile). In addition, UI is a leading Webhosting provider, operating globally. UI also runs two of the most successful general interest Internet portals in the German market (Web.de, GMX) and controls c. 50% of all email addresses in Germany. Lastly, UI has participations in several companies in the TMT space.

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Rating Company

Buy Compugroup

Europe Medical AG Germany

Healthcare & Medical Reuters Bloomberg Price at 3 Apr 2013 (EUR) 17.59 Devices COPMa.DE COP GY Price Target (EUR) 23.00 Facilities & Services 52-week range (EUR) 18.33 - 10.56

Price/price relative Investment case: A solid business model backed by pricing power 20 The company's core HPS segment is a leading software provider for doctors (c. 43% market share in Germany) and hospitals. While the market for doctors´ 16 software, at least in Germany and France, is already mature and offers only 12 limited incremental growth prospects, it serves as a reliable cash flow 8 contributor for the remaining growth areas of this segment, i.e., international 4 licenses and software for hospitals. In addition, underpinned by a solid 4/10 10/10 4/11 10/11 4/12 10/12 business model with low churn rates among customers, we believe the Compugroup Medical A company will be able to maintain its pricing power and successfully up-sell its DJ (.STOXXE) (Rebased) products with minimum incremental cost. As a result, steady revenue growth Performance (%) 1m 3m 12m and the benefits of consolidating its numerous recent acquisitions should Absolute 0.5 19.9 59.9 result in significant margin expansion over our forecast years, in line with DJ (.STOXXE) 0.9 0.1 8.7 management’s goal of 30% EBITDA margins in the long term. Stock & option liquidity data Recent events: Healthier by the quarter Market cap (EUR)(m) 883.0 CompuGroup reported E450.7m revenue in 2012, of which E290m was through recurring sources such as software maintenance (up 28% yoy). Given Shares outstanding (m) 50 the high switching costs involved (churn typically only ~4% p.a.) we believe Free float (%) 50 CompuGroup will continue to experience low churn rates in its 385,000-strong Option volume (und. shrs., 1M avg.) – client base. Also, given its market leadership, we believe it will maintain its pricing power in most of its markets and continue to up-sell its products. With the Jan. recurring revenue run-rate implying further 6% yoy growth in 2013, we expect total revenue of E481m, in line with 4-8% organic growth guidance. Given that revenue from maintaining and up-selling software comes with minimum incremental costs, we believe the company could experience significant margin improvement from growth in revenue. This was evident in 2012’s incremental EBITDA margins of 60%, with overall EBITDA margins improving to 23% in 2012 from 18% in 2011 (up c. 500bps). As management focuses more on improving profitability through tighter cost controls, we expect margins to continue to expand over our forecast years. Valuation / Risks DCF-derived target price of E23 yields significant upside potential. Due to its stable business model and strong cash generating potential, we have used a three-stage DCF valuation to derive our target price. The key assumptions for our WACC of 6.6% are: a risk-free rate of 4.0%, risk premium of 4.5%, beta of 1.2, tax rate of 30.0%, and terminal growth of 2.5%. Key risks include: 1) unfavourable changes in regulation, 2) increasing competition, 3) unsuccessful integration of acquisitions, and 4) weak protection of patents. Next Financial Event Q1 results are due 3 May, 2013.

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Model updated:01 March 2013 Fiscal year end 31-Dec 2009 2010 2011 2012E 2013E 2014E

Running the numbers Financial Summary Europe DB EPS (EUR) 0.70 0.83 0.71 1.36 1.50 1.76 Reported EPS (EUR) 0.24 0.33 0.18 0.77 0.97 1.23 Germany DPS (EUR) 0.25 0.25 0.25 0.46 0.53 0.62 Facilities & Services BVPS (EUR) 3.7 3.6 3.4 3.8 4.3 5.0 Weighted average shares (m) 50 50 50 50 50 50 Compugroup Medical AG Average market cap (EURm) 295 443 500 883 883 883 Enterprise value (EURm) 409 616 744 1,110 1,065 1,009 Reuters: COPMa.DE Bloomberg: COP GY Valuation Metrics Buy P/E (DB) (x) 8.3 10.6 14.0 13.0 11.7 10.0 P/E (Reported) (x) 24.6 26.6 54.5 22.9 18.2 14.3 Price (3 Apr 13) EUR 17.59 P/BV (x) 2.03 3.06 2.59 4.60 4.07 3.50 Target Price EUR 23.00 FCF Yield (%) 9.0 5.0 5.1 7.4 7.8 9.3 Dividend Yield (%) 4.3 2.9 2.5 2.6 3.0 3.5 52 Week range EUR 10.56 - 18.33 EV/Sales (x) 1.4 2.0 1.9 2.5 2.2 2.0 Market Cap (m) EURm 883 EV/EBITDA (x) 6.9 9.2 10.2 10.5 8.8 7.5 USDm 1,134 EV/EBIT (x) 16.5 18.6 20.3 16.6 12.8 10.6

Company Profile Income Statement (EURm) CompuGROUP is one of the leading providers in the Sales revenue 293 312 397 451 481 511 market for software solutions for the healthcare sector in Gross profit 232 253 322 374 400 426 Germany, other European countries and Turkey (18 EBITDA 59 67 73 105 121134 countries in total). According to company surveys, Depreciation 5567 88 approximately 240,000 doctors and dentists use Amortisation 29 29 30 31 3030 CompuGROUP's software solutions globally. In the doctor EBIT 25 33 37 67 8395 information systems business for doctors in private Net interest income(expense) -7 -7 -11 -12 -14 -7 practice in Germany alone, CompuGROUPs market share Associates/affiliates 0 0 0 0 00 measured by the number of installations with relevant Exceptionals/extraordinaries 0 0 0 0 00 doctors for the Company is approximately 43% and Other pre-tax income/(expense) 0 0 0 0 0 0 approximately 44% with dentists. The company was Profit before tax 18 27 25 55 69 88 founded in 1987. Income tax expense 7 10 16 16 21 26 Price Performance Minorities 0000 00 Other post-tax income/(expense) 0 0 0 0 0 0 20 Net profit 12 17 9 39 49 62 16 DB adjustments (including dilution) 23 25 26 29 27 27 12 DB Net profit 35 42 36 68 75 88 8 Cash Flow (EURm) 4 Cash flow from operations 44 40 47 88 89 105 Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Net Capex -17 -17 -21 -23 -20 -23 Free cash flow 27 22 25 65 69 82 Compugroup Medical AG DJ (.STOXXE) (Rebased) Equity raised/(bought back) -4 0 0 -2 0 0

Margin Trends Dividends paid 0000 00 Net inc/(dec) in borrowings 16 73 52 -3 0 0 28 Other investing/financing cash flows -25 -82 -96 -45 -23 -26 24 Net cash flow 13 13 -18 14 45 56 Change in working capital 0 15 10 -1 -2 -5 20 16 Balance Sheet (EURm) 12 Cash and other liquid assets 29 42 24 38 83 139 8 Tangible fixed assets 37 39 50 71 75 82 09 10 11 12E 13E 14E Goodwill/intangible assets 311 381 459 436 415 393 EBITDA Margin EBIT Margin Associates/investments 2 1 1 1 11

Other assets 73 83 107 110 110 106 Growth & Profitability Total assets 452 546 641 657 684 721 Interest bearing debt 144 217 270 266 266 266 30 30 Other liabilities 122 146 203 199 201 202 25 25 Total liabilities 266 363 473 465 467 469 20 20 Shareholders' equity 185 183 168 192 217 252 15 15 Minorities 1000 00 10 10 Total shareholders' equity 186 183 168 192 217 253 5 5 Net debt 115 175 246 228 183 127 0 0 09 10 11 12E 13E 14E Key Company Metrics Sales growth (%) 28.0 6.5 27.0 13.6 6.8 6.1 Sales gr owth (LHS) ROE (RHS) DB EPS growth (%) 15.4 18.5 -14.0 90.1 10.9 17.3

Solvency EBITDA Margin (%) 20.2 21.5 18.4 23.4 25.2 26.2 EBIT Margin (%) 8.5 10.6 9.2 14.8 17.3 18.7 200 14 Payout ratio (%) 105.1 75.9 136.5 60.3 54.2 50.1 12 ROE (%) 6.6 9.0 5.2 21.4 23.8 26.3 150 10 Capex/sales (%) 5.9 5.5 5.4 5.1 4.2 4.5 8 100 Capex/depreciation (x) 0.5 0.5 0.6 0.6 0.5 0.6 6 Net debt/equity (%) 61.9 95.4 146.1 119.1 84.3 50.3 50 4 2 Net interest cover (x) 3.7 4.8 3.2 5.6 6.1 13.2

0 0 Source: Company data, Deutsche Bank estimates 09 10 11 12E 13E 14E

Net debt/equity (LHS) Net interest cover (RHS)

Uwe Schupp, CFA +49 69 910-31955 [email protected]

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Rating Company

Buy Duerr

Europe Germany

Reuters Bloomberg

Capital Goods DUEG.DE DUE GY Price at 3 Apr 2013 (EUR) 86.31 Engineering Price Target (EUR) 95.00 52-week range (EUR) 87.25 - 39.43 Investment case: Outlook appears conservative, remaining 10% ahead of cons. Duerr is the global leader for auto paint shops with c. 50% market share – and Price/price relative in emerging markets its footprint is even stronger. Thus, we see the company 100 benefiting from capacity expansion by OEMs in BRIC markets over the coming 80 years. This and an improved cost base could result in even higher earnings. A 60 strengthened balance sheet leaves room for bolt-on acquisitions and/or 40 increased returns to shareholders. We forecast robust top-line growth and 20 margin recovery based on recent order trends as well as the final fade out of 0 low-margin businesses accepted during the crisis. 4/10 10/10 4/11 10/11 4/12 10/12 Recent events: Q4 exceeds expectations Duerr DJ (.STOXXE) (Rebased) Duerr’s Q4’12 numbers were robust: in line on the top line but even ahead of our above-consensus forecast for EBIT. In Q4, revenues were E642m and EBIT Performance (%) 1m 3m 12m was E58m (DBe: E55m, cons: E51m), i.e. 9% margin. New orders were E643m Absolute 1.2 24.3 74.6 so 4% y/y after a 36% drop y/y in Q3 and a book/bill of 1x. FCF was even DJ (.STOXXE) 0.9 0.1 8.7 ahead of our expectation of E50m at E66m, indicating E125m in Q4. The final quarter did thus show the strongest quarterly FCF generation in Duerr’s history Stock & option liquidity data on what is its strongest EBIT margin ever. Net cash came to E100m. For the Market cap (EUR)(m) 1,493.2 full year, EBIT margin was 7.4%, comfortably ahead of our 7.2% estimate and already close to our FY13 forecast of 7.5% (10% ahead of cons). The dividend Shares outstanding (m) 17 is proposed to be E2.25, i.e. 36% payout ratio, slightly above last year’s c.30%. Free float (%) 64 Duerr guides for slightly down order intake to E2.3-2.5bn (DBe: E2.4bn, cons: Option volume (und. shrs., 1M avg.) – E2.2bn), increased sales of E2.4-2.6bn (DBe: E2.6bn, cons: E2.5bn) and improved earnings with a margin between 7.0-7.5% (DBe: 7.5%, cons: 7.4%).

We note Duerr tends to be very conservative at the beginning of the year (several guidance increases last year) and the new orders as well as sales exit rate appear to leave upside to the outlook. Additionally, the order backlog stands at E2.3bn, ~1y sales (DBe: E2.3bn). We feel comfortable with our forecasts c. 10% ahead of cons and expect the Street to move in our direction. In the CC, Duerr confirmed our view that the backlog is of better margin quality and that current trading looks good. Thus, we believe the utilization rate should remain high - and as there are no special impacts visible that should weigh on margins, we see decent upside to margin guidance. Valuation / Risks We value Duerr on an equally weighted mix of 2013E EV/EBITDA peer group multiple, DCF (WACC of 8.5%, TG 1.5%) and an EV/IC model ((ROIC - g)/(WACC - g), with g of 0%). We focus on 2012E as we want to mirror the expected recovery post-2010 and apply a 3-stage DCF model to consider mid- term earnings potential. Oe adjusted our estimates and raised our TP to E95 after the strong Q4 on an equally weighted mix of 2013E EV/EBITDA peer group multiple, DCF and EV/IC model ((ROIC-g)(WACC-g), g 0%). Risks include slower-than-expected industry CAPEX growth, a slowdown in Emerging Markets, and M&A. Next Financial Event Q1’13 results on the 7th of May and potentially comments on current trading around our DB Small and Mid cap conference on the 10th and 11th of May.

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9 April 2013 Made in Germany Special Report

Model updated:19 February 2013 Fiscal year end 31-Dec 2009 2010 2011 2012E 2013E 2014E

Running the numbers Financial Summary Europe DB EPS (EUR) -1.60 0.37 3.58 6.44 7.65 7.51 Reported EPS (EUR) -1.60 0.37 3.58 6.44 7.65 7.51 Germany DPS (EUR) 0.00 0.30 1.20 2.25 2.68 3.00 Engineering BVPS (EUR) 17.0 18.1 20.7 28.6 33.9 38.7 Weighted average shares (m) 17 17 17 17 17 17 Duerr Average market cap (EURm) 211 331 468 1,359 1,359 1,359 Enterprise value (EURm) 259 361 499 1,340 1,249 1,165 Reuters: DUEG.DE Bloomberg: DUE GY Valuation Metrics Buy P/E (DB) (x) nm 52.3 7.6 12.2 10.3 10.5 P/E (Reported) (x) nm 52.3 7.6 12.2 10.3 10.5 Price (5 Apr 13) EUR 78.58 P/BV (x) 1.00 1.32 1.64 2.75 2.32 2.03 Target Price EUR 95.00 FCF Yield (%) 30.7 7.2 23.3 6.6 8.9 9.6 Dividend Yield (%) 0.0 1.6 4.4 2.9 3.4 3.8 52 Week range EUR 39.43 - 87.25 EV/Sales (x) 0.2 0.3 0.3 0.6 0.5 0.4 Market Cap (m) EURm 1,359 EV/EBITDA (x) 10.1 6.8 3.9 6.6 5.5 5.1 USDm 1,769 EV/EBIT (x) 45.2 10.7 4.7 7.6 6.2 5.8

Company Profile Income Statement (EURm) Duerr AG engineers and builds plants and manufactures Sales revenue 1,078 1,261 1,922 2,400 2,596 2,661 machinery for the automotive industry in Europe, North Gross profit 221 237 331 438 493 506 and South America, and Asia. The Company designs and EBITDA 26 53 129 202 228227 constructs fully automatic paint finishing plants, final Depreciation 20 19 23 25 2625 assembly systems, and air purifier and water treatment Amortisation 0000 00 systems. Duerr also produces computerized, camera- EBIT 6 34 106 177 202202 controlled production robots. Net interest income(expense) -19 -22 -21 -29 -23 -22 Associates/affiliates 1 1 1 0 11 Price Performance Exceptionals/extraordinaries 0 0 0 0 00 Other pre-tax income/(expense) 0 0 0 0 0 0 100 Profit before tax -12 13 86 148 180 181 80 Income tax expense 14 5 22 36 47 51 60 Minorities 2120 10 Other post-tax income/(expense) 0 0 0 0 0 0 40 Net profit -28 6 62 111 132 130 20 0 DB adjustments (including dilution) 0 0 0 0 0 0 Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 DB Net profit -28 6 62 111 132 130

Duerr DJ (.STOXXE) (Rebased) Cash Flow (EURm)

Cash flow from operations 81 38 128 118 150 153 Margin Trends Net Capex -16 -14 -19 -28 -29 -23 10 Free cash flow 65 24 109 90 121 130 Equity raised/(bought back) 0 0 0 0 0 0 8 Dividends paid -14 -1 -7 -21 -39 -46 6 Net inc/(dec) in borrowings -22 125 3 0 0 0 4 Other investing/financing cash flows -8 2 -59 0 0 0 2 Net cash flow 21 150 46 69 82 84 0 Change in working capital 95 30 -5 0 -8 -1 09 10 11 12E 13E 14E Balance Sheet (EURm) EBITDA Margin EBIT Margin Cash and other liquid assets 104 252 299 349 440 524

Tangible fixed assets 109 114 167 173 181 184 Growth & Profitability Goodwill/intangible assets 308 316 327 321 316 310 60 30 Associates/investments 14 12 20 20 2020 Other assets 433 521 849 849 862 864 40 20 Total assets 968 1,216 1,661 1,711 1,818 1,902 20 10 Interest bearing debt 104 232 286 286 286 286 0 0 Other liabilities 563 665 1,011 993 939 940 -20 -10 Total liabilities 667 897 1,297 1,279 1,225 1,226 Shareholders' equity 295 313 359 494 587 670 -40 -20 09 10 11 12E 13E 14E Minorities 6655 55 Total shareholders' equity 301 319 364 500 593 675 Sales gr owth (LHS) ROE (RHS) Net debt 0 -20 -12 -63 -154 -238

Solvency Key Company Metrics Sales growth (%) -32.8 17.1 52.4 24.9 8.2 2.5 10 10 DB EPS growth (%) na na 878.5 80.1 18.7 -1.8 0 8 EBITDA Margin (%) 2.4 4.2 6.7 8.4 8.8 8.5 -10 6 EBIT Margin (%) 0.5 2.7 5.5 7.4 7.8 7.6 -20 4 Payout ratio (%) nm 82.1 33.6 34.9 35.0 40.0 -30 2 ROE (%) -8.8 2.1 18.4 26.1 24.5 20.7 Capex/sales (%) 1.6 1.2 1.0 1.2 1.1 0.9 -40 0 Capex/depreciation (x) 0.9 0.8 0.9 1.1 1.1 0.9 09 10 11 12E 13E 14E Net debt/equity (%) 0.0 -6.3 -3.4 -12.6 -25.9 -35.2 Net debt/equity (LHS) Net interest cover (RHS) Net interest cover (x) 0.3 1.6 5.0 6.1 8.8 9.2

Source: Company data, Deutsche Bank estimates

Tim Rokossa +49 69 910-31998 [email protected]

Deutsche Bank AG/London Page 23

9 April 2013 Made in Germany Special Report

Rating Company

Buy LEG

Europe Germany

Real Estate Reuters Bloomberg Price at 4 Apr 2013 (EUR) 41.66 Real Estate LEGn.DE LEG GR Price Target (EUR) 48.50 52-week range (EUR) 44.00 - 41.60

Investment case: High visibility on inflation-linked cash flows Price/price relative

LEG is a well-managed residential property pure play on NRW. Management 46.0 pursues a buy-and-manage approach with value enhancement coming from 45.0 further rent increases, vacancy reduction and increasing margins by adding 44.0 43.0 more units at low incremental cost. Its long debt duration and 40% exposure 42.0 to rent-restricted units provide good visibility on cash flows, which are 41.0 inflation-protected through regular rent adjustments to CPI. 2/13 LEG Recent events: Rents to benefit from household growth and immigration; no DJ (.STOXXE) (Rebased) major short-term refinancing needs Performance (%) 1m 3m 12m Rents have increased 2.3% per annum (like-for-like) since 2008, outperforming Absolute -4.5 2,926. 2,926. both inflation and the NRW market. We expect further rental upside from 4 4 rising demand in many parts of the NRW housing market, driven by ~13.5% 1- DJ (.STOXXE) 0.2 -0.9 10.9 to 2- person household growth in NRW over 2009-30 meeting low supply. In Stock & option liquidity data addition, stronger-than-expected immigration into the region could serve as an Average Market cap (EUR)(m) 2,206.2 upside surprise to demand. The higher education levels of recent immigrants Shares outstanding (m) 53 should further enhance affordability in the region, which again could benefit Free float (%) – rents and prices. Regarding financing, LEG has a long, 13-year debt duration Option volume (und. shrs., 1M avg.) – with no major short-term refinancing needs and a low 3.3% cost of debt. Its modest LTV of 48% offers the benefit of a low marginal cost of debt and should allow the company to re-lever up to 55% maximum target leverage through acquisitions without the need to tap the market. The debt portfolio is almost entirely hedged/fixed. We expect 5% CAGR in net rental income (2012- 16), mainly on the back of rental growth and what we see as conservative acquisition assumptions. We expect FFO (excluding sales) to rise 6% per annum, fuelled by a stable cost of debt and efficiency gains via platform expansion. LEG targets a 65% payout ratio of FFO (excluding sales) starting in 2013 and one-fourth of that level for 2012. Valuation / Risks We set our PT by applying a target premium/ disc. to 1-yr. forward DB NAV. We value LEG at our 2013E DB NAV to derive our E48.5 PT. We expect LEG to trade at a10% relative discount to GSW which we consider the closest peer. Risks include asset class, social charter, inflation protection. Next Financial Event LEG releases its 2012 Annual Report on 30 April 2013.

Page 24 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

Model updated:13 March 2013 Fiscal year end 31-Dec 2010 2011 2012E 2013E 2014E

Running the numbers Financial Summary Europe DB EPS (EUR) 2.12 2.11 2.55 2.64 2.88 Reported EPS (EUR) 0.54 -0.29 2.29 1.99 3.49 Germany DPS (EUR) 0.00 0.00 0.41 1.72 1.87 Real Estate BVPS (EUR) 42.3 40.5 41.7 43.2 45.0 Weighted average shares (m) 53 53 53 53 53 LEG Average market cap (EURm) na na 2,185 2,185 2,185 Enterprise value (EURm) na na 4,608 4,666 4,764 Reuters: LEGn.DE Bloomberg: LEG GR Valuation Metrics Buy P/E (DB) (x) na na 16.2 15.6 14.3 P/E (Reported) (x) na nm 18.0 20.8 11.8 Price (5 Apr 13) EUR 41.26 P/BV (x) 0.00 0.00 0.99 0.95 0.92 Target Price EUR 48.50 FCF Yield (%) na na 1.2 0.7 1.9 Dividend Yield (%) na na 1.0 4.2 4.5 52 Week range EUR 41.26 - 44.00 EV/Sales (x) nm nm 9.0 8.8 8.7 Market Cap (m) EURm 2,185 EV/EBITDA (x) nm nm 15.1 18.4 14.4 USDm 2,843 EV/EBIT (x) nm nm 15.4 18.8 14.7

Company Profile Income Statement (EURm) LEG Immobilien AG was founded in 1970 by the Federal Sales revenue 487 499 510 529 547 State of North Rhine Westphalia (NRW) to provide Gross profit 282 286 302 309 322 affordable living space in the region. The company was EBITDA 228 190 306 254330 privatized in 2008 and IPO'd in 2013. LEG is a pure play on Depreciation 776 66 residential property in NRW, Germany's most populous Amortisation 000 00 state. With c.90k units valued around E4.9bn, the group is EBIT 221 184 300 248324 the fifth largest residential landlord in Germany. The group Net interest income(expense) -166 -172 -176 -140 -136 offers stable and predictable cash flows, with value Associates/affiliates 0 0 0 00 enhancing opportunities arising from rent increases and Exceptionals/extraordinaries 0 0 0 00 acquisitions. Other pre-tax income/(expense) 2 -2 0 0 0 Price Performance Profit before tax 58 9 123 107 187 Income tax expense 29 24 2 2 2 46.0 Minorities 000 00 45.0 Other post-tax income/(expense) 0 0 0 0 0 44.0 Net profit 29 -15 121 105 185 43.0 DB adjustments (including dilution) 84 127 14 35 -33 42.0 DB Net profit 112 112 135 140 152 41.0 Feb 13 Cash Flow (EURm) Cash flow from operations 112 77 106 116 146 LEG DJ (.STOXXE) (Rebased) Net Capex -29 -31 -80 -102 -104

Free cash flow 83 46 26 15 41 Margin Trends Equity raised/(bought back) 0 0 0 0 0 64 Dividends paid 0 0 0 -22 -91 60 Net inc/(dec) in borrowings -48 39 122 19 20 56 Other investing/financing cash flows -76 -87 -61 0 0 52 Net cash flow -40 -2 88 12 -30 48 Change in working capital 41 60 26 0 0 44 40 Balance Sheet (EURm) 36 10 11 12E 13E 14E Cash and other liquid assets 84 82 169 181 152 Tangible fixed assets 4,769 4,812 4,994 5,126 5,309 EBITDA Margin EBIT Margin Goodwill/intangible assets 3 6 6 6 6

Associates/investments 12 11 13 1313 Growth & Profitability Other assets 134 78 96 96 96 4 10 Total assets 5,002 4,988 5,278 5,422 5,575 Interest bearing debt 2,210 2,307 2,490 2,557 2,624 8 3 Other liabilities 551 536 582 575 568 6 Total liabilities 2,761 2,842 3,071 3,132 3,192 2 4 Shareholders' equity 2,241 2,146 2,206 2,290 2,384 2 1 Minorities 000 00 0 Total shareholders' equity 2,241 2,146 2,206 2,290 2,384 0 -2 10 11 12E 13E 14E Net debt 2,127 2,225 2,320 2,376 2,472

Sales gr owth (LHS) ROE (RHS) Key Company Metrics

Sales growth (%) nm 2.4 2.3 3.6 3.5 Solvency DB EPS growth (%) na -0.5 20.9 3.5 8.8 EBITDA Margin (%) 46.8 38.2 59.9 48.0 60.3 110 3 EBIT Margin (%) 45.4 36.8 58.7 46.8 59.2 105 2 Payout ratio (%) 0.0 nm 18.1 86.5 53.5 100 2 ROE (%) 1.3 -0.7 5.6 4.7 7.9 95 1 Capex/sales (%) 5.1 4.9 15.6 19.2 19.1 90 1 Capex/depreciation (x) 3.8 3.7 12.8 16.3 16.7 Net debt/equity (%) 94.9 103.7 105.2 103.8 103.7 85 0 Net interest cover (x) 1.3 1.1 1.7 1.8 2.4 10 11 12E 13E 14E

Source: Company data, Deutsche Bank estimates Net debt/equity (LHS) Net interest cover (RHS)

Markus Scheufler +44 20 754-18170 [email protected]

Deutsche Bank AG/London Page 25

9 April 2013 Made in Germany Special Report

Rating Company

Buy MorphoSys

Europe Germany

Reuters Bloomberg

Biotechnology MORG.DE MOR GY Price at 5 Apr 2013 (EUR) 30.47 Biotechnology Price Target (EUR) 43.00 Investment case: All eyes on pipeline potential 52-week range (EUR) 35.40 - 16.11 One of the key strengths of MorphoSys remains its highly profitable and cash- generative partnership model for the development of antibody-based drugs Price/price relative

(>$50bn market). The corresponding pipeline has evolved into one of the 36 broadest in the industry, holding considerable and well diversified valuation 32 28 potential as MorphoSys stands to benefit from committed R&D funding as 24 20 well as success-based milestones and royalties on each of the partnered 16 programs. In addition, visible cash flows from partners allow MorphoSys to 12 8 fully fund the development of its own programs, which could yield even 4/10 10/10 4/11 10/11 4/12 10/12 greater upside from partnering at a later stage. Morphosys DJ (.STOXXE) (Rebased) Recent events: MOR103 in focus Performance (%) 1m 3m 12m Even on our conservative base case assumptions (i.e. pipeline attrition in line Absolute 0.6 1.0 56.1 with industry average, but peak sales below), we find that the current EV of MorphoSys is fully supported by the partnered pipeline alone, suggesting free DJ (.STOXXE) -3.4 -2.5 9.3 upside potential from MOR103 (the company’s proprietary blockbuster Stock & option liquidity data candidate in RA) as well as from other proprietary programs and potential new Market cap (EUR)(m) 701.0 partnerships (based on its latest antibody technology Ylanthia). In a blue-sky Shares outstanding (m) 23 scenario (i.e., pipeline attrition and peak sales in line with industry average), Free float (%) – shares could double even if all proprietary programs failed or even triple if Option volume (und. shrs., 1M avg.) – MOR103 would make it to market. First and foremost, a potential partnering deal for MOR103 over the course of 2013 should attract significant attention from investors and could prove a major positive catalyst for shares. Furthermore, up to five partnered programs are due to complete phase II trials in 2013/14, an important benchmark for further validation of the pipeline potential. In addition, Gantenerumab (Roche’s blockbuster candidate in Alzheimer’s) may report interim phase II/III data as early as this year, while MOR202 (MorphoSys’ proprietary anti-CD38 antibody in multiple myeloma) may report interim data from the ongoing ph. I/IIa open label trial. As usual, setbacks are unavoidable, but as long as data are in line with typical attrition, we expect substantial shareholder value creation independent of macro cycle. Valuation / Risks We value MorphoSys on a DCF model (WACC 9%, forecast horizon until 2036 with no terminal growth thereafter) as we believe this best mirrors the long- term visible, macro-independent growth profile and valuation potential of its partnered and proprietary pipeline as well as other assets. On a per share basis, we attribute a value of E16.5 for the Novartis collaboration, E10 for other collaborations, E10.5 for MOR103, E6 for net cash, while taking a neutral view on proprietary pipeline activities (ex MOR103). Key risks include 1) Lack of partnering on MOR103, 2) pipeline failure beyond typical attrition, 3) lower than expected peak sales and 4) proprietary pipeline overspent. Next Financial Event Q1’13 results are scheduled for May 03, but are unlikely to create excitement. Given the disposal of AbD Serotec end of last year, no milestones or partnering income but higher proprietary R&D (as guided), we expect reported revenues to decline, negative EBIT in the mid/high single-digit EURm range.

Page 26 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

Model updated:07 March 2013 Fiscal year end 31-Dec 2010 2011 2012 2013E 2014E 2015E

Running the numbers Financial Summary Europe DB EPS (EUR) 0.40 0.36 0.10 -0.58 -0.56 -0.54 Reported EPS (EUR) 0.40 0.36 0.10 -0.58 -0.56 -0.54 Germany DPS (EUR) 0.00 0.00 0.00 0.00 0.00 0.00 Biotechnology BVPS (EUR) 8.2 8.6 8.8 8.7 8.1 7.6 Weighted average shares (m) 23 23 23 23 23 23 Morphosys Average market cap (EURm) 366 436 477 701 701 701 Enterprise value (EURm) 258 302 356 555 577 598 Reuters: MORG.DE Bloomberg: MOR GY Valuation Metrics Buy P/E (DB) (x) 40.0 53.6 203.7 nm nm nm P/E (Reported) (x) 40.0 53.6 203.7 nm nm nm Price (5 Apr 13) EUR 30.47 P/BV (x) 2.26 2.04 3.34 3.51 3.76 4.03 Target Price EUR 43.00 FCF Yield (%) nm 5.4 nm nm nm nm Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 52 Week range EUR 16.11 - 35.40 EV/Sales (x) 3.0 3.0 6.9 11.1 11.0 10.9 Market Cap (m) EURm 701 EV/EBITDA (x) 16.1 16.1 40.5 nm nm nm USDm 912 EV/EBIT (x) 26.1 24.8 143.0 nm nm nm

Company Profile Income Statement (EURm) MorphoSys is one of the world's leading biotechnology Sales revenue 87 101 52 50 53 55 companies focusing on fully human antibodies. With its Gross profit 80 94 52 50 53 55 proprietary technologies, MorphoSys is developing not EBITDA 16 19 9 -19 -18-17 only the next generation of therapeutic antibodies, but also Depreciation 6761 11 antibodies for research and diagnostics purposes. HuCAL® Amortisation 0000 00 (Human Combinatorial Antibody Library) is the company's EBIT 10 12 2 -20 -19-18 core technology for the rapid and automated production of Net interest income(expense) 4 1 1 1 1 1 specific antibodies. MorphoSys runs 68 partnered Associates/affiliates 0 0 0 0 00 therapeutic antibody programs and works on 10 Exceptionals/extraordinaries 0 0 0 0 00 proprietary compounds. Other pre-tax income/(expense) -1 -2 0 5 0 0 Price Performance Profit before tax 13 11 3 -14 -19 -18 Income tax expense 4 3 1 -1 -6 -5 36 Minorities 0000 00 32 Other post-tax income/(expense) 0 0 0 0 0 0 28 24 Net profit 9 8 2 -13 -13 -12 20 DB adjustments (including dilution) 0 0 0 0 0 0 16 12 DB Net profit 9 8 2 -13 -13 -12 8 Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Cash Flow (EURm) Cash flow from operations 2 27 2 -20 -19 -19 Morphosys DJ (.STOXXE) (Rebased) Net Capex -14 -3 -2 -2 -3 -3

Free cash flow -12 24 -1 -23 -22 -21 Margin Trends Equity raised/(bought back) 3 3 3 0 0 0 30 Dividends paid 0000 00 Net inc/(dec) in borrowings 0 0 0 0 0 0 15 Other investing/financing cash flows 12 -14 -10 48 0 0 0 Net cash flow 3 12 -7 25 -22 -21 -15 Change in working capital 25 30 12 13 18 18 -30 Balance Sheet (EURm) -45 10 11 12 13E 14E 15E Cash and other liquid assets 44 55 41 66 44 23 Tangible fixed assets 6 6 3 7 11 14 EBITDA Margin EBIT Margin Goodwill/intangible assets 69 66 35 33 31 29

Associates/investments 64 80 80 80 8080 Growth & Profitability Other assets 26 22 65 28 34 41 20 6 Total assets 210 228 223 213 199 186 4 Interest bearing debt 0 0 0 0 0 0 0 2 Other liabilities 24 31 18 14 14 13 0 Total liabilities 24 31 19 14 14 13 -20 -2 Shareholders' equity 186 197 202 200 186 174 -40 -4 Minorities 0000 00 -6 Total shareholders' equity 186 197 202 200 186 174 -60 -8 10 11 12 13E 14E 15E Net debt -44 -55 -41 -66 -44 -23

Sales gr owth (LHS) ROE (RHS) Key Company Metrics

Sales growth (%) 7.4 15.8 -48.5 -3.7 5.0 4.8 Solvency DB EPS growth (%) 1.6 -12.0 -71.4 na 3.2 4.4 EBITDA Margin (%) 18.3 18.6 17.0 -38.0 -34.6 -31.5 0 -5 EBIT Margin (%) 11.3 12.1 4.8 -40.0 -36.5 -33.3 -10 Payout ratio (%) 0.0 0.0 0.0 nm nm nm -15 ROE (%) 5.1 4.3 1.2 -6.7 -6.8 -6.9 -20 Capex/sales (%) 15.9 3.6 4.5 5.0 4.8 4.6 -25 Capex/depreciation (x) 2.3 0.5 0.4 2.5 2.5 2.6 -30 Net debt/equity (%) -23.7 -27.7 -20.1 -33.1 -23.6 -13.2 -35 Net interest cover (x) nm nm nm nm nm nm 10 11 12 13E 14E 15E

Source: Company data, Deutsche Bank estimates Net debt/equity (LHS) Net interest cover (RHS)

Gunnar Romer +49 69 910-31917 [email protected]

Deutsche Bank AG/London Page 27

9 April 2013 Made in Germany Special Report

Rating Company

Buy Schaltbau Holding

Europe AG Germany

Capital Goods Reuters Bloomberg Price at 5 Apr 2013 (EUR) 31.44 Engineering SLTG.DE SLT GR Price Target (EUR) 38.00 52-week range (EUR) 35.17 - 24.33 Investment case: specialized in niche markets Price/price relative As the past cycle proved, Schaltbau is less affected by economic swings outperforming its underlying end markets given its high exposure to the rail 40 industry and extensive diversification into niche markets with few competitors. 30 Along a currently strong order backlog, we thus expect solid performance in 20

2013 despite the low volume environment in Europe. Further, we expect the 10 company to return to above-market growth rates going forward via i) 0 continuously high innovation levels that should lead to market share gains, 4/10 10/10 4/11 10/11 4/12 10/12 Schaltbau Holding Ag access to new costumer groups and increasing margins (R&D spending c. 6- DJ (.STOXXE) (Rebased) 7% of sales), ii) further regional expansion with particularly promising growth Performance (%) 1m 3m 12m opportunities in Chinese rail markets, as well as iii) a controlled acquisition Absolute -5.2 -1.0 14.8 strategy in a consolidating market. Along an improving balance sheet, we thus DJ (.STOXXE) -3.4 -2.5 9.3 think Schaltbau is a solid investment in a challenging economic environment. Recent events: FY12 profit pre-release - a solid finish; 2013 outlook unchanged Stock & option liquidity data Schaltbau has issued preliminary FY12 results which suggest strong order Market cap (EUR)(m) 193.4 intake (+9% y/y to E372m) and sales (+14% y/y to E363m) as well as a solid Shares outstanding (m) 6 EBIT development (E29.5) especially in view of integration /acquisition Free float (%) 1 expenses for Tiefenbach and substantially increased R&D and personnel costs. Option volume (und. shrs., 1M avg.) – This implies a strong Q4 result and suggests that the acquisition of Tiefenbach has turned profitable now (Q4 sales +17%y/y, EBIT +75% y/y, 8.8% margin).

Schaltbau issued a dividend proposal of 0.77E significantly above our estimate of 0.65E and consensus of 0.6E. Schaltbau has not issued a new guidance and we assume that the outlook from November remains valid. The company envisages sales of E374m (+7% y/y), EBIT of cE33m (+13% y/y, 8.8% margin) and net income of cE22m. This is roughly in line with consensus and slightly below our forecasts (about 5%) but we generally regard management as relatively conservative. Valuation / Risks We value Schaltbau on an equal blend of two valuation metrics. We use forward-looking EV/EBIT and PE multiples to reflect earnings potential and sentiment relative to business cycle and peers. We use DCF valuation given the company's relatively stable business model and cash-generation potential. Schaltbau trades at a significant discount to peers, which we think is unjustified given its above-average-growth potential. Risk: Key downside risks to our forecasts include: i) Significant public spending cuts especially in Schaltbau's core market Germany, ii) A prolonged economic decline that would hurt the capital goods exposure, iii) Adverse regulatory changes, iv) Failure to successfully integrate acquisitions, and v) Dependence on a few large customers such as Deutsche Bahn which could limit pricing leverage. Next Financial Date Schaltbau pre-released headline numbers reflecting a strong year in a difficult economic environment. Next financial event will be on 23th of April when the company releases final FY12 results.

Page 28 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

Model updated:18 January 2013 Fiscal year end 31-Dec 2010 2011 2012 2013E 2014E 2015E

Running the numbers Financial Summary Europe DB EPS (EUR) 2.03 2.71 3.03 3.24 4.04 4.60 Reported EPS (EUR) 2.03 3.13 3.03 3.24 4.04 4.60 Germany DPS (EUR) 0.37 0.60 0.65 0.74 1.01 1.15 Engineering BVPS (EUR) 5.1 8.8 10.9 13.5 16.8 20.4 Weighted average shares (m) 6 6 6 6 6 6 Schaltbau Holding Ag Average market cap (EURm) 86 136 161 193 193 193 Enterprise value (EURm) 130 168 201 235 226 220 Reuters: SLTG.DE Bloomberg: SLT GR Valuation Metrics Buy P/E (DB) (x) 7.6 8.4 8.8 9.7 7.8 6.8 P/E (Reported) (x) 7.6 7.3 8.8 9.7 7.8 6.8 Price (5 Apr 13) EUR 31.44 P/BV (x) 3.74 2.68 2.84 2.32 1.87 1.54 Target Price EUR 38.00 FCF Yield (%) 4.0 9.6 nm 1.8 8.5 8.1 Dividend Yield (%) 2.4 2.6 2.4 2.4 3.2 3.7 52 Week range EUR 24.33 - 35.17 EV/Sales (x) 0.5 0.5 0.6 0.6 0.5 0.5 Market Cap (m) EURm 193 EV/EBITDA (x) 4.3 4.9 5.4 5.7 4.8 4.3 USDm 252 EV/EBIT (x) 5.5 6.1 6.7 7.1 5.9 5.2

Company Profile Income Statement (EURm) Germany-based Schaltbau is a leading manufacturer of Sales revenue 280 318 363 397 421 451 components and systems for the transportation and Gross profit 133 152 173 189 201 215 capital goods industries. It operates in three business EBITDA 30 35 37 41 4752 segments: Mobile Transportation Technology, Stationary Depreciation 6788 99 Transport Technology and Components. It has a Amortisation 0000 00 widespread product portfolio including door systems for EBIT 24 27 30 33 3842 trains and busses/coaches, signaling and safety Net interest income(expense) -6 -6 -5 -6 -5-5 technology for rail infrastructure, industrial brakes well as Associates/affiliates 1 2 2 2 22 electrical components for an extensive number of Exceptionals/extraordinaries 0 0 0 0 00 applications. Other pre-tax income/(expense) -1 2 0 0 0 0 Price Performance Profit before tax 18 25 27 29 35 40 Income tax expense 3356 78 40 Minorities 3333 34 30 Other post-tax income/(expense) 0 0 0 0 0 0 Net profit 12 19 19 20 25 28 20 DB adjustments (including dilution) 0 -3 0 0 0 0 10 DB Net profit 12 16 19 20 25 28 0 Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Cash Flow (EURm) Cash flow from operations 11 22 8 14 28 28 Schaltbau Holding Ag DJ (.STOXXE) (Rebased) Net Capex -8 -9 -9 -11 -11 -12

Free cash flow 3 13 -1 3 16 16 Margin Trends Equity raised/(bought back) 0 0 0 0 0 0 12.0 Dividends paid -1 -2 -4 -4 -5 -6 Net inc/(dec) in borrowings -7 0 5 -1 3 4 11.0 Other investing/financing cash flows 7 -10 0 0 0 0 10.0 Net cash flow 3 1 1 -2 15 13 Change in working capital -13 -2 -20 -13 -6 -10 9.0 Balance Sheet (EURm) 8.0 Cash and other liquid assets 12 13 14 12 26 39 10 11 12 13E 14E 15E Tangible fixed assets 42 44 45 47 50 52 EBITDA Margin EBIT Margin Goodwill/intangible assets 15 20 20 20 21 21

Associates/investments 4 6 6 8 89 Growth & Profitability Other assets 117 131 157 173 184 202 15 60 Total assets 190 214 243 260 289 324 Interest bearing debt 55 44 49 48 50 54 50 Other liabilities 102 110 116 116 118 123 10 40 Total liabilities 156 154 165 163 168 177 30 Shareholders' equity 29 52 67 83 104 126 5 20 Minorities 5 7 10 14 1721 10 Total shareholders' equity 33 60 78 97 121 146 0 0 10 11 12 13E 14E 15E Net debt 43 31 35 36 24 15

Sales gr owth (LHS) ROE (RHS) Key Company Metrics

Sales growth (%) 3.9 13.5 14.0 9.5 5.9 7.2 Solvency DB EPS growth (%) -1.7 33.4 11.9 6.8 24.7 13.9 EBITDA Margin (%) 10.8 10.9 10.3 10.4 11.2 11.4 140 10 EBIT Margin (%) 8.5 8.6 8.2 8.4 9.1 9.4 120 8 100 Payout ratio (%) 16.9 19.2 21.0 23.0 25.0 25.0 80 6 ROE (%) 54.0 46.2 31.2 26.4 26.6 24.7 60 4 Capex/sales (%) 2.9 2.7 2.5 2.7 2.7 2.6 40 2 Capex/depreciation (x) 1.3 1.2 1.2 1.3 1.3 1.3 20 Net debt/equity (%) 130.7 52.2 45.6 37.1 20.0 10.0 0 0 Net interest cover (x) 3.8 4.3 6.0 5.1 7.0 8.5 10 11 12 13E 14E 15E

Source: Company data, Deutsche Bank estimates Net debt/equity (LHS) Net interest cover (RHS)

Felicitas Bismarck +49 69 910-31975 [email protected]

Deutsche Bank AG/London Page 29

9 April 2013 Made in Germany Special Report

Rating Company

Buy Tom Tailor

Europe Germany

Consumer Discretionary Reuters Bloomberg Price at 5 Apr 2013 (EUR) 17.27 & Luxury TTIGn.DE TTI GR Price Target (EUR) 19.00 Other Consumer 52-week range (EUR) 18.26 - 10.75 Discretionary

Price/price relative

Investment case: The best of two worlds 20 18 After the Bonita acquisition in summer 2012, the Tom Tailor Group is all about 16 complementarities: young fashion (TT) and ‘best ager’ segment (Bonita), 14 12 wholesale and retail background, focus on collection and focus on logistics. 10 Bonita should be able to fix its like-for-like sales weakness until end 2013 and 8 4/10 10/10 4/11 10/11 4/12 10/12 then generate growth again, driven by improved products and shorter lead Tom Tailor times. TT's own stores will be transferred simultaneously to Bonita's state of DJ (.STOXXE) (Rebased) the art logistics platform step by step, taking until 2014. The combination of Performance (%) 1m 3m 12m best practices should result in 20%+ clean EPS growth in 2013 and 2014. Absolute -0.4 3.7 30.0 Recent events: Tom Tailor brand strong, Bonita turnaround from H2-13 DJ (.STOXXE) -3.4 -2.5 9.3 onwards Stock & option liquidity data The Tom Tailor brand has continuously outperformed the market with strong Market cap (EUR)(m) 380.5 lfl and total sales growth, due to rapidly improving brand awareness and customers’ willingness to buy. This should benefit the brand in the future as Shares outstanding (m) 24 well. Contrarily, the acquired Bonita brand saw sales decline on a lfl basis in Free float (%) – 2012. Going forward, we expect positive lfl sales growth from H2-13 onwards Option volume (und. shrs., 1M avg.) – with the first new collections under TT management. Additionally, we expect sales growth to be boosted by 100 stores openings p.a. (60 TT, 40 Bonita). We believe a higher share of direct sourcing should result in margin expansion. So far sales growth has not translated into a sustainable margin expansion; instead margins were burdened by frequent one-offs, in our view the main reason for TT’s discount to peers. Because of various growth initiatives operating leverage will likely not be on the agenda before 2014, but an improving gross margin from a higher share of direct sourcing should help margins in 2013. Therefore, we are modestly above company guidance with our 2013 forecasts of EUR 912m sales and a recurring EBITDA margin of 12.7% (vs. guidance of >EUR900m and 12% respectively). Valuation / Risks Our target price of EUR 19 is 10x our 2014 clean EPS. This represents a c.10% discount to the historical trading level of the company since its IPO (11x) and puts it at a discount to European peers (clothing and general retail companies). We apply a discount as Tom Tailor is implementing several projects in parallel and therefore, execution risk has grown since the IPO. Major risks: ability to implement its growth strategy (i.e., ambitious target for retail store network); hurdles in overseas expansion plans and execution risk in the integration of Bonita into the group, as well as continued lacklustre margin developments. Next Financial Date Tom Tailor is due to report Q1-13 on 8 May 2013. Our expectations for the top line are moderate after challenging weather conditions but we look for significant gross margin improvements from a higher share of direct sourcing.

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Model updated:19 March 2013 Fiscal year end 31-Dec 2010 2011 2012 2013E 2014E 2015E

Running the numbers Financial Summary Europe DB EPS (EUR) 0.87 0.93 1.20 1.60 1.94 2.48 Reported EPS (EUR) 0.15 0.59 0.02 0.98 1.81 2.34 Germany DPS (EUR) 0.00 0.17 0.00 0.30 0.50 0.70 Other Consumer Discretionary BVPS (EUR) 5.9 6.7 10.7 9.8 11.3 13.1 Weighted average shares (m) 14 17 18 22 24 24 Tom Tailor Average market cap (EURm) 182 219 259 381 418 418 Enterprise value (EURm) 237 297 513 589 572 498 Reuters: TTIGn.DE Bloomberg: TTI GR Valuation Metrics Buy P/E (DB) (x) 15.0 14.3 11.9 10.8 8.9 7.0 P/E (Reported) (x) 84.4 22.3 900.6 17.6 9.6 7.4 Price (5 Apr 13) EUR 17.27 P/BV (x) 2.71 1.84 1.50 1.76 1.53 1.31 Target Price EUR 19.00 FCF Yield (%) nm nm nm 12.3 14.9 20.8 Dividend Yield (%) 0.0 1.3 0.0 1.7 2.9 4.1 52 Week range EUR 10.75 - 18.26 EV/Sales (x) 0.7 0.7 0.8 0.6 0.6 0.5 Market Cap (m) EURm 381 EV/EBITDA (x) 7.9 6.4 9.3 5.4 4.1 3.2 USDm 495 EV/EBIT (x) 33.4 14.2 31.7 10.5 7.1 5.2

Company Profile Income Statement (EURm) Founded in 1962 and listed since 2010, Tom Tailor is a Sales revenue 348 412 630 912 997 1,083 vertically integrated fashion company, offering casual Gross profit 160 202 333 502 558 612 wear for men, women and children. The two main product EBITDA 30 46 55 109138 156 lines are Tom Tailor Casual and Tom Tailor Denim. The Depreciation 15 20 33 4553 56 company's products are sold in 35 countries worldwide Amortisation 855 855 through more than 6,000 points of sale. The main growth EBIT 7 21 16 5680 96 driver is the company's own retail activities. About two Net interest income(expense) -11 -7 -16 -18 -14 -10 thirds of sales are generated in Germany. Associates/affiliates 0 0 0 00 0 Exceptionals/extraordinaries 0 0 0 00 0 Other pre-tax income/(expense) 0 0 0 0 0 0 Price Performance Profit before tax -4 14 0 38 67 85 Income tax expense -7 4 -3 11 20 26 20 Minorities 003 333 18 Other post-tax income/(expense) 0 0 0 0 0 0 16 Net profit 2 10 0 24 44 57 14 12 DB adjustments (including dilution) 10 5 22 15 3 3 10 DB Net profit 12 15 22 39 47 60 8 Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Cash Flow (EURm) Cash flow from operations 7 14 6 79 94 111 Tom Tailor DJ (.STOXXE) (Rebased) Net Capex -27 -22 -149 -32 -32 -24

Free cash flow -20 -8 -143 47 62 87 Margin Trends Equity raised/(bought back) 0 0 21 0 0 0 16 Dividends paid 000 000 Net inc/(dec) in borrowings -110 -5 170 -16 -60 -60 12 Other investing/financing cash flows 138 0 17 -1 -8 -13 8 Net cash flow 8 -13 65 30 -6 14 Change in working capital -12 -22 -77 -1 -12 0 4 Balance Sheet (EURm) 0 10 11 12 13E 14E 15E Cash and other liquid assets 22 9 53 83 77 91 Tangible fixed assets 35 50 164 154 136 107 EBITDA Margin EBIT Margin Goodwill/intangible assets 142 139 353 344 340 335

Associates/investments 000 000 Growth & Profitability Other assets 88 123 202 206 225 245 60 25 Total assets 288 320 771 787 778 778 Interest bearing debt 75 84 301 285 225 165 50 20 Other liabilities 113 123 251 259 274 289 40 15 Total liabilities 188 207 552 544 499 454 30 10 Shareholders' equity 97 111 213 237 274 318 20 Minorities 336 666 10 5 Total shareholders' equity 100 114 219 243 279 324 0 0 10 11 12 13E 14E 15E Net debt 52 75 248 202 148 74

Sales gr owth (LHS) ROE (RHS) Key Company Metrics

Sales growth (%) 15.8 18.4 53.0 44.9 9.3 8.6 Solvency DB EPS growth (%) 607.9 5.9 29.8 33.0 21.5 27.7 EBITDA Margin (%) 8.6 11.3 8.7 12.0 13.8 14.4 120 10 EBIT Margin (%) 2.0 5.1 2.6 6.1 8.1 8.8 100 8 Payout ratio (%) 0.0 28.6 0.0 27.8 27.7 29.9 80 6 ROE (%) 14.7 9.4 0.2 10.6 17.1 19.2 60 4 Capex/sales (%) 7.7 5.4 23.6 3.5 3.2 2.2 40 Capex/depreciation (x) 1.8 1.1 4.4 0.7 0.6 0.4 20 2 Net debt/equity (%) 52.0 65.6 113.2 83.1 52.9 22.7 0 0 Net interest cover (x) 0.6 2.9 1.0 3.2 5.9 9.2 10 11 12 13E 14E 15E

Source: Company data, Deutsche Bank estimates Net debt/equity (LHS) Net interest cover (RHS)

Michael Kuhn +49 69 910-36642 [email protected]

Deutsche Bank AG/London Page 31

9 April 2013 Made in Germany Special Report

Rating Company

Buy United Internet

Europe Germany

Technology Reuters Bloomberg Price at 5 Apr 2013 (EUR) 18.55 IT Software & Services UTDI.DE UTDI GY Price Target (EUR) 22.00 52-week range (EUR) 19.42 - 12.58

Investment case: The re-rating looks set to continue Price/price relative FY12 results demonstrated that United Internet’s growth strategy is unfolding 20 according to plan. The “Access” segment showed a strong acceleration in growth as well as an impressive margin expansion. In FY13 and FY14 we 16 expect “Applications” to follow suit, fuelled by customer wins in new markets 12 as well as successful up-selling. Continued strong contract customer wins 8 (guidance +1m) should provide high visibility on 2014. We therefore believe 4/10 10/10 4/11 10/11 4/12 10/12 that the shares deserve a further re-rating as 20% EPS CAGR through 2015E is United Internet not adequately priced in at 16.5x FY13E P/E. DJ (.STOXXE) (Rebased) Recent events Performance (%) 1m 3m 12m United Internet reported FY12 results on 21 March. We believe the numbers as Absolute 3.1 12.5 33.3 well as the (more detailed) outlook for FY13 fully support our investment case. DJ (.STOXXE) -3.4 -2.5 9.3 Group revenues grew by an impressive 14.4% to Euro 2.4bn, driven by the Stock & option liquidity data “Access” segment (+15.9% y/y). EBITDA of Euro 344m (-6% y/y) was depressed by c. Euro 124m of incremental costs related to the international Market cap (EUR)(m) 3,597.0 roll-out of webhosting and the launch of DE-mail in Germany. The Shares outstanding (m) 194 ‘established’ businesses showed an EBITDA of Euro 450m, up 17% y/y. For Free float (%) 55 FY13, management guided for revenue growth of c. 10% which was broadly Option volume (und. shrs., 1M avg.) 8,112 in-line with our expectations. The EBITDA target of c. Euro 400m, however, was c. 5% below our forecast. At the same time, UI aims for c. 1m new contract customer wins, which compares to 850k in our model. Hence, we believe the overall guidance set is not only consistent but also provides better than expected visibility on continued growth beyond 2013. The EPS target corridor for FY13 remained Euro 1.00-1.10. Valuation / Risks Due to its holding character, we value United Internet shares on a Sum-of-the- Parts analysis (SOTP). We assess the value of the "Access" division based on a FY14E median EV/EBIT multiple of a European telco peer group (7x). The "Applications" segment we benchmark against a peer group of technology / cloud based businesses applying a FY14E median EV/EBITDA target multiple of 11x. We also add the value of United Internet's investments (e.g. SEDO, Versatel and European Founders Funds) to derive our target price. The main downside risks are (i) the failure of the group's expansion strategy into new markets, especially in the international roll-out of its hosting solutions and (ii) higher than expected price pressure in the German telecommunication market. Moreover, value-erosive M&A constitutes a risk. Next Financial Date United Internet will report Q1 results on 21 May. We will have management on a non-deal-road-show in London on 10 April and the company will present at Deutsche Bank’s Pan-European Small & Midcap Conference on 11 April.

Page 32 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

Model updated:08 April 2013 Fiscal year end 31-Dec 2010 2011 2012 2013E 2014E 2015E

Running the numbers Financial Summary Europe DB EPS (EUR) 0.57 0.79 0.79 1.08 1.39 1.61 Reported EPS (EUR) 0.58 0.78 0.55 1.08 1.39 1.61 Germany DPS (EUR) 0.20 0.30 0.30 0.35 0.38 0.40 IT Software & Services BVPS (EUR) 1.6 0.6 0.8 2.4 3.3 4.3 Weighted average shares (m) 223 206 194 194 194 194 United Internet Average market cap (EURm) 2,420 2,704 2,867 3,597 3,597 3,597 Enterprise value (EURm) 2,473 3,037 2,973 3,543 3,361 3,141 Reuters: UTDI.DE Bloomberg: UTDI GY Valuation Metrics Buy P/E (DB) (x) 19.1 16.7 18.7 17.2 13.4 11.5 P/E (Reported) (x) 18.9 16.8 26.8 17.2 13.4 11.5 Price (5 Apr 13) EUR 18.55 P/BV (x) 7.83 22.82 20.79 7.65 5.69 4.36 Target Price EUR 22.00 FCF Yield (%) 10.7 5.9 9.6 6.1 7.1 8.3 Dividend Yield (%) 1.8 2.3 2.0 1.9 2.0 2.2 52 Week range EUR 12.58 - 19.42 EV/Sales (x) 1.3 1.5 1.2 1.3 1.2 1.0 Market Cap (m) EURm 3,597 EV/EBITDA (x) 6.9 8.3 8.6 8.7 6.7 5.5 USDm 4,679 EV/EBIT (x) 9.1 11.0 14.6 11.4 8.4 6.8

Company Profile Income Statement (EURm) United Internet (UI) is a technology holding company Sales revenue 1,907 2,094 2,397 2,633 2,881 3,111 offering telecommunication services in Germany under its Gross profit 747 789 901 985 1,091 1,182 1&1 brand (DSL and mobile). In addition, UI is a leading EBITDA 358 365 344 406 502567 Webhosting provider, operating globally. UI also runs two Depreciation 66 71 79 79 8486 of the most successful general interest Internet portals in Amortisation 20 18 61 16 1616 the German market (Web.de, GMX) and controls c. 50% of EBIT 271 276 204 311 402465 all email addresses in Germany. Lastly, the group made Net interest income(expense) -10 -13 -10 -11 -12 -12 various investments in publicly listed and privately held Associates/affiliates -46 -13 -2 5 66 companies. Exceptionals/extraordinaries 2 0 0 0 00 Other pre-tax income/(expense) 0 0 0 0 0 0 Price Performance Profit before tax 216 251 193 305 396 459 Income tax expense 88 88 85 94 127 147 20 Minorities 0000 00 Other post-tax income/(expense) 0 0 0 0 0 0 16 Net profit 129 162 108 210 269 312

12 DB adjustments (including dilution) -2 1 46 0 0 0 DB Net profit 127 163 154 210 269 312 8 Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12 Cash Flow (EURm) Cash flow from operations 290 195 261 285 335 381 United Internet DJ (.STOXXE) (Rebased) Net Capex -32 -36 15 -67 -78 -84

Free cash flow 259 159 276 218 257 297 Margin Trends Equity raised/(bought back) -118 -340 0 0 0 0 20 Dividends paid -88 -42 -58 -59 -68 -74 Net inc/(dec) in borrowings -31 155 -224 0 0 0 16 Other investing/financing cash flows -42 37 -16 0 0 -1 Net cash flow -21 -31 -22 160 189 222 12 Change in working capital 52 -17 46 -23 -37 -35 Balance Sheet (EURm) 8 10 11 12 13E 14E 15E Cash and other liquid assets 96 65 43 202 391 614 Tangible fixed assets 109 111 109 122 139 161 EBITDA Margin EBIT Margin Goodwill/intangible assets 624 589 508 510 515 523

Associates/investments 229 136 161 162 160157 Growth & Profitability Other assets 213 286 287 309 352 387 20 70 Total assets 1,271 1,187 1,108 1,304 1,557 1,842 60 Interest bearing debt 369 525 300 300 300 300 15 50 Other liabilities 520 508 609 412 460 505 40 Total liabilities 889 1,032 910 712 760 806 10 30 Shareholders' equity 373 145 188 582 783 1,021 5 20 Minorities 10 10 10 10 1515 10 Total shareholders' equity 382 155 198 592 798 1,036 0 0 10 11 12 13E 14E 15E Net debt 273 460 257 98 -91 -314

Sales gr owth (LHS) ROE (RHS) Key Company Metrics

Sales growth (%) 15.0 9.8 14.4 9.9 9.4 8.0 Solvency DB EPS growth (%) -39.0 38.2 0.4 37.1 28.2 15.9 EBITDA Margin (%) 18.8 17.4 14.3 15.4 17.4 18.2 400 40 EBIT Margin (%) 14.2 13.2 8.5 11.8 14.0 14.9 300 30 Payout ratio (%) 34.5 38.1 54.0 32.3 27.4 24.9 200 ROE (%) 32.2 62.7 64.7 54.5 39.4 34.5 20 100 Capex/sales (%) 3.8 2.6 2.7 2.7 2.7 2.7 0 10 Capex/depreciation (x) 0.8 0.6 0.7 0.7 0.8 0.8 Net debt/equity (%) 71.5 297.1 129.9 16.5 -11.4 -30.3 -100 0 Net interest cover (x) 26.9 22.1 20.9 28.8 34.7 37.5 10 11 12 13E 14E 15E

Source: Company data, Deutsche Bank estimates Net debt/equity (LHS) Net interest cover (RHS)

Benjamin Kohnke +49 69 910-31943 [email protected]

Deutsche Bank AG/London Page 33

9 April 2013 Made in Germany Special Report

2.2 German SME sector focus: identifying the most relevant spots

In addition to our general investment themes outlined in detail above, we highlight key trends, Buy and Sell ideas across the most important sectors within German SMEs under Deutsche Bank coverage. Section 2.1 above presents the selected key picks in more detail. Most of the German SME companies are concentrated in six sectors, i.e. Autos & Parts (page 34), Consumer/Retail (page 34), Mechanical Engineering (page 35), Pharma & HC/Biotech (page 36), Real Estate (page 37) and TMT (Technology, Media and Telcos) (pages 38-39). As single business cases may vary strongly from the rest of those companies in the same sector, we highlight the most important common drivers within each sector, analyse investor positioning and highlight key picks to help readers identify the most interesting themes and Buy ideas from a top-down perspective. Automobiles & Parts: focus on suppliers geared into capacity expansion We expect around a 3% increase for global automotive sales this year with growth coming mainly from Asia and a solid US market. For Europe, we see sales declining by around 4%, with a weaker first half and some recovery from a lower base in H2. Most industry participants share the view that in light of ongoing macro difficulties, Europe might remain below its structural growth level for some time. As, in contrast to this, almost all OEMs follow a growth strategy, we expect the recent capacity expansion in emerging markets to continue. On the other hand, parts suppliers which are focused on Europe should continue to struggle with lower production rates. For 2014, we expect a somewhat better global sales development with 6% growth. We believe most parts suppliers will suffer from this development while those geared into capacity expansion provide better visibility on earnings in the coming quarters. Unlike for most parts suppliers, we even see the chance of earnings growth for some of these names. Outside the direct automotive world, we continue to dislike Delticom (DEXGn.DE) as we see the business struggling from a weak European replacement market/pricing and in particular from increased competition and price transparency. Given the above described trends, our favourite name in the sector remains Duerr (DUEG.DE) while we are neutral to negative on most part suppliers (see pages 22-23 for details).

Contact Jochen Gehrke ([email protected]) (+49-69-910-31949) and Tim Rokossa ([email protected]) (+49-69-910-31998) for details.

Figure 37: Sector positioning in Germany over time Figure 38: German SME companies under Deutsche Bank (German Prime All Share Automobiles & Parts sector) coverage within the Automobiles & Parts sector

0.60 1.8 Mcap Price TP Upside 1.6 Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 0.40 1.4 Bertrandt AG BDTG.DE H 902 89.6 75.0 (16) 0.20 Delticom AG DEXGn.DE S 432 36.5 28.0 (23) 1.2 Duerr DUEG.DE B 1,366 78.9 95.0 20 0.00 1.0 ElringKlinger AG ZILGn.DE H 1,425 22.5 21.0 (7)

0.8 KUKA AG KU2G.DE H 1,055 31.1 30.0 (4) -0.20 LEONI LEOGn.DEH 96029.427.0(8) 0.6 Norma Group AG NOEJ.DE H 778 24.4 22.0 (10) -0.40 0.4 Rheinmetall RHMG.DE S 1,340 35.3 31.0 (12) SAF Holland SA SFQN.DE H 262 5.8 5.0 (13) -0.60 0.2 2008 2009 2010 2011 2012 2013 SHW SW1.DEB 19733.734.01 Sixt AG SIXG.DE H 745 15.5 16.0 3 Sector weight* Prime Automobile rel. to Prime All Shares, x (rhs) Automobile & Parts (5)

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

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Consumer/Retail: prefer Consumer over Retail based on more attractive risk/reward German consumer and retail stocks in the small and mid-cap segment are on average highly reliant on their domestic market (German exposure for most stocks is >60% of sales). Consequently, private consumption in Germany is a major driver for the stocks in our universe. We expect unemployment to remain at a low level and household incomes to rise. Both effects result in an above-average consumer climate with recently improving trends. Consequently, we expect private consumption in Germany to increase by 0.6% yoy, one of the rare positive spots in Europe. Nevertheless, German retail market growth is typically in the low single-digits which is why companies need to outperform their respective retail markets on a like-for-like sales basis to profit from operating leverage and ignite investors’ interest. Furthermore, exogenous factors, such as weather conditions (in particular for textile and “do-it-yourself” (DIY) retailers) and unexpected shocks to disposable income can strongly influence these businesses. For that reason we prefer companies with self-help opportunities (e.g. restructuring at Praktiker and a shift to direct sourcing at Tom Tailor). Generally, we focus on stocks with strong earnings growth accompanied by low valuation, given attractive risk/reward. Tom Tailor (TTIGn.DE) is our top pick in the German consumer/retail universe. The company continually outperforms the market with its Tom Tailor brand, due to rapidly improving brand awareness and offers turnaround potential for the acquired Bonita brand after the first positive integration effects become visible from H2-13 onwards. Additionally, a higher share of direct sourcing allows the company to improve its margins going forward, largely independent of market developments. All this comes at a below-sector 2013 PE of 11x (see pages 30-31 for details).

Contact Michael Kuhn ([email protected]) (+49-69-910-36642) and Benjamin Goy ([email protected]) (+49-69-910-31946) for details.

Figure 39: Sector positioning in Germany over time Figure 40: German SME companies under Deutsche Bank (German Prime All Share Consumer/Retail sector) coverage within the Consumer/Retail sector

Consumer Mcap Price TP Upside 0.60 1.8 Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 1.6 0.40 Fielmann FIEG.DE S 3,089 73.6 60.0 (18) 1.4 Gerry Weber GWIG.DE B 1,453 31.7 40.0 26 0.20 1.2 Hugo Boss BOSSn.DE B 6,032 87.4 96.0 10 0.00 1.0 Kabel Deutschland KD8Gn.DE B 6,201 70.1 61.0 (13) 0.8 PUMA SE PUMG.DE H 3,490 233.2 225.0 (3) -0.20 Sky Deutschland SKYDn.DE H 3,439 4.0 4.5 13 0.6 -0.40 TUI AG TUIGn.DE B 1,985 7.9 10.3 31 0.4 Air Berlin AB1.DE B 261 2.2 3.5 57 -0.60 0.2 Bijou Brigitte BIJG.DE H 589 74.7 66.0 (12) 2008 2009 2010 2011 2012 2013 CEWE COLOR CWCG.DE B 214 32.8 38.0 16 Sector weight* Prime Consumer rel. to Prime All Shares, x (rhs) CTS Eventim AG EVDG.DE B 1,298 27.1 32.0 18 Retail Loewe AG LOEG.DE H 40 3.0 NA NA 0.70 2.0 Tom Tailor TTIGn.DE B 379 17.2 19.0 10 1.8 0.50 Villeroy & Boch VIBG_p.DE H 102 8.3 7.0 (15) 1.6 Zooplus AG ZO1G.DE B 250 40.9 50.0 22 0.30 1.4 Consumer 3 0.10 1.2 1.0 -0.10 0.8 BayWa BYWGnx.DE H 1,237 36.0 39.0 8 -0.30 0.6 Metro Group MEOG.DE H 7,193 22.0 23.0 4 0.4 Hawesko HAWG.DE H 386 43.0 40.0 (7) -0.50 0.2 Hornbach Holding HBHG_p.DE B 806 50.4 64.0 27 -0.70 0.0 Praktiker PRAG.DE B 131 1.1 2.6 126 2008 2009 2010 2011 2012 2013 Sector weight* Prime Retail rel. to Prime All Shares, x (rhs) Retail 8

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

Deutsche Bank AG/London Page 35

9 April 2013 Made in Germany Special Report

Mechanical Engineering: Heterogeneous sector, behaving surprisingly homogenously Our German SME engineering universe includes stocks that are quite heterogeneous in terms of products, business models and end-markets, but often behave in a surprisingly homogenous way. As such, the sector is cyclical and growth depends substantially on macro developments. We found that sector sales growth correlates strongly with German Industrial Production growth (R² of 90% with a gearing of slightly above 1x). Naturally, this relationship varies from company to company and we note that our coverage includes three longer cycle names [Vossloh (VOSG.DE), Schaltbau (SLTG.DE) and VTG (VT9G.DE)] which all have large railway exposure. In the short term, sector margin expansion is usually driven by revenue growth, given the high operational gearing of most companies, although long-term profitability has more subtle drivers such as competitive position, and regional and product mix, as well as cost inflation and productivity – in the end, however, it often boils down to pricing power. The recent share rally suggests multiple expansion rather than recovery expectations: Given the cyclical nature and the high gearing of the capital goods companies, share prices often react to macroeconomic sentiment long before we see an actual operational impact. As such, news around the crisis in Europe had sent sector shares tumbling since Q3’11. However, operationally we have not seen a comparable downturn: indeed, most companies reached peak volumes in 2012. The strong sector rally over recent months thus seems to reflect de-risking and asset re-allocation rather than earnings recovery expectations implying sector multiple expansion. 2013 – Who can grow earnings in a low volume environment?: Macro indicators remain volatile, but most currently suggest only moderate developments for industrial production in Germany in 2013. This, in turn, suggests only modest volume growth for the sector. In such a low volume environment, operational gearing will lack its usual earnings driving power so that pricing power, product mix, regional exposure should return to investors’ focus. Regionally, we expect Europe to continue its subdued development in 2013/14, whereas China, the Americas should provide growth impulses (however, strongly varying across end-markets). We thus prefer names which can either outperform the market in Europe (given higher pricing /product mix) or have a strong standing in Americas/China with low margin dilution effects. We highlight Schaltbau AG (SLTG.DE) as our key pick in the sector (see pages 28-29 for details).

Contact Felicitas Bismarck ([email protected]) (+49-69-910-31975).

Figure 41: Sector positioning in Germany over time Figure 42: German SME companies under Deutsche Bank (German Prime All Share Industrial sector) coverage within the Industrial sector 0.60 1.4

1.3 0.40 Mcap Price TP Upside Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 1.2 0.20 Deutz AG DEZG.DE H 460 3.8 NA NA 1.1 GEA G1AG.DE B 4,897 25.4 30.0 18 0.00 1.0 Gildemeister AG GILG.DE H 903 15.0 NA NA 0.9 Heidelberger Druck HDDG.DE B 382 1.6 2.5 52 -0.20 Jungheinrich JUNG_p.DE B 1,095 32.2 32.0 (1) 0.8 Koenig & Bauer AGSKBG.DEH 29517.912.0(33) -0.40 0.7 Krones KRNG.DE H 1,641 54.4 38.0 (30) MTU MTXGn.DE B 3,703 73.0 78.0 7 -0.60 0.6 2008 2009 2010 2011 2012 2013 Rational AG RAAG.DE H 2,591 227.9 NA NA Schaltbau Holding SLTG.DE B 194 31.5 38.0 21 Sector weight* Prime Industrial rel. to Prime All Shares, x (rhs) Vossloh VOSG.DE H 947 79.0 70.0 (11) VTG AG VT9G.DE B 284 13.3 14.0 5 Wacker Neuson SE WACGn.DE H 788 11.2 10.0 (11) Mechanical engineering 3 * Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

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Pharma & HC/Biotech: intrinsic value and self-help/turnaround stories in focus German SME healthcare and biotech names feature distinct differences in business models and end-markets. Hence, in contrast to other sectors (that tend to feature greater similarities) indentifying major common trends appears more difficult. Nonetheless, we would highlight the following key themes: (1) Sentiment looks positive: over the past few months, consensus earnings estimates have remained largely stable across the sector, whereas shares have moved up on average. Interestingly, we find that many of the names in this sector tend to trade at the upper end of (or even above) historical valuation corridors. Similarly, since the end of the Q3 2012 reporting season, multiples expansion in the sector has been more pronounced than for the broader market. In addition, positive/improving sentiment for small and midcap healthcare names is consistent with significant money inflows in the large cap healthcare space. (2) Strong volatility around headlines: in the recent Q4/FY12 reporting season, shares in the German SME healthcare space reacted strongly to company news flow (and broker notes). For names where the market was concerned about weak results and/or disappointing outlook statements, we have seen fairly pronounced share price weakness into reportings. However, this was often more than offset by strength after reportings, which is surprising to the extent that often results and/or outlook statements were in fact mixed or even below market expectations. At least consistent with this trading pattern, shares in companies with strong results and/or positive outlook statements tended to trade strongly both ahead and after respective events. (3) Intrinsic value and self-help/turnaround stories in focus: we believe investors continue to closely monitor the exposure of companies to government austerity and their ability to compensate for respective pressures. For example, a lot of time was recently spent on discussions around the medical device tax and sequestration in the US, while more generally, considerable focus is still put on the companies’ exposure and strategy in perceived low/high growth regions (e.g. Southern Europe and Emerging Markets). Accordingly, we continue to find particular interest from investors in those names that are either independent from government austerity or have structural growth/turnaround potential which goes beyond potential macro pressures. MorphoSys (MORG.DE) is our key pick in the sector as we continue to see excellent risk/reward in the name with multiple sources for a re-rating (see pages 26-27 for details).

Contact Holger Blum ([email protected]) (+41-44-227-3376) and Gunnar Romer ([email protected]) (+49-69-910-31917) for details.

Figure 43: Sector positioning in Germany over time Figure 44: German SME companies under Deutsche Bank (German Prime All Share Pharma & Healthcare sector) coverage within the Pharma & HC/Biotech sector 0.60 1.4

1.3 0.40 Mcap Price TP Upside Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 1.2 0.20 Carl Zeiss Meditec AFXG.DE H 1,891 23.3 22.5 (3) 1.1 Celesio CLSGn.DE H 2,517 14.8 13.5 (9) 0.00 1.0 Draegerwerk AG DRWG_p.DE B 1,515 98.5 115.0 17 Evotec EVTG.DE H 271 2.3 2.6 13 0.9 -0.20 Gerresheimer GXIG.DE H 1,354 43.1 43.0 (0) 0.8 Morphosys MORG.DEB 71431.043.039 -0.40 Qiagen* QGEN.OQ B 3,735 20.5 21.5 5 0.7 Rhoen Klinikum RHKG.DE H 2,251 16.3 16.6 2 -0.60 0.6 Sartorius SATG_p.DE H 1,346 78.9 77.0 (2) 2008 2009 2010 2011 2012 2013 Stada Arzneimittel AG STAGn.DE B 1,791 30.3 33.0 9 Sector weight* Prime Healthcare rel. to Prime All Shares, x (rhs) Stratec SBSG.DE H 398 34.3 32.0 (7) Pharma & HC/Biotech 3 * Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. *Price in USD. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

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Real Estate: The seven-year itch We expect increased transaction activity in the residential property market over the coming two years, due to funds winding up and refinancing issues from investors who bought during the 2004-07 transaction boom. We anticipate that the listed space will likely benefit and find a number of EPS and NAV-accretive acquisition opportunities by having access to fresh equity and debt at attractive terms. We argue that GSW (GIBG.DE) and LEG (LEGn.DE) trading at +/-5% to spot NAV are cheap and should benefit from the current environment as the market is overlooking accretive acquisitions resulting in strong cash flow growth due to their funding benefit. (1) Revival of the transaction market: large upcoming balloon repayments on the German CMBS maturity profile suggest that we are about to enter the 7th year since the 2004-07 transaction boom. In 2013, about E9bn in repayments become due. We anticipate a higher number of portfolio re-sales over the coming two years based in the winding up of funds due to misperception on returns in German property and their high LTVs (>70%) making refinancing or prolongation very difficult, sometimes impossible. (2) A regulated refinancing environment does not benefit all business models: In the absence of large new CMBS issuance, we have seen a rebirth of the Mortgage Pfandbrief (covered bond) for mortgage loan refinancing over the past two years. We anticipate that a number of investors could find it difficult to adapt their business models from an unregulated to a strictly regulated refinancing channel (<60% LTV; conservative valuation approach). Owing to stricter bank regulation and rating downgrades, making unsecured funding disproportionally more expensive compared to secured debt, fulfilling the Mortgage Pfandbrief seems like the ‘only’ decently priced source of funding available, especially for large volumes (>E300m) over the past six months. Due to the scarcity of debt, we see hardly any funding available for >65% levered portfolios. The latter, especially, allows/has allowed the low levered (c.50% LTV) German property companies to pick up decently priced portfolios (initial yields between 7-8%) and refinance them at record cheap terms (2.8-3.5%). (3) We expect strong dividend and NAV growth: following the deleveraging of the listed space over the past years, companies are now able to buy portfolios at higher yields than their current valuation and refinance at cheaper marginal than their current cost of debt. Finally, trading at NAV premiums could potentially result in the evolution of a virtuous circle, in which partly equity-funded acquisitions are accretive to EPS and NAV per share and the weight of acquisitions drives NAV up even higher resulting in strong share performance. LEG (LEGn.DE) is our preferred pick (see pages 24-25 for details).

Contact Markus Scheufler ([email protected]) (+44-20-754-18170) for details.

Figure 45: Sector positioning in Germany over time Figure 46: German SME companies under Deutsche Bank (German Prime All Share Financial Services sector) coverage within the Real Estate/Financial Services sector 0.80 1.4 0.60 1.3 Mcap Price TP Upside

0.40 1.2 Company name Ticker Rec. (EUR m) (EUR) (EUR) (%)

0.20 1.1 Alstria AOXG.DE B 707 9.0 10.7 19 Deutsche EuroShop DEQGn.DE H 1,659 30.8 33.0 7 0.00 1.0 Deutsche Wohnen DWNG.DE H 2,184 13.6 15.5 14 -0.20 0.9 GAGFAH GFJG.DE H 1,765 9.0 8.0 (11) -0.40 0.8 GSW GIBG.DE B 1,483 29.4 36.0 23 LEG LEGn.DE B 2,148 40.6 48.5 20 -0.60 0.7 Prime Office PMOG.DE H 178 3.4 3.5 2 -0.80 0.6 2008 2009 2010 2011 2012 2013 Real Estate/Financial Services 11 Sector weight* Prime Financial services rel. to Prime All Shares, x (rhs)

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

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TMT (Technology, Media and Telcos): Stock-picking remains essential By nature, the TMT sector is quite heterogeneous with regard to the respective business models and, consequently, the constituents’ growth and earnings profile in a given point of the economic cycle. This also holds for publicly-listed SMEs in the German market. Hence, this is a sector where stock-picking is of utmost importance, in our view. (1) Telecommunications: for the telecommunication sub-sector we continue to see value in mobile service providers which we regard as defensive plays, given the highly- attractive dividend yields which are backed by a strong (and sustainable) free cash flow profile. Within this group, we prefer United Internet (UTDI.DE), which has the most promising growth strategy in place, in our view. (2) Media: within the (scarce) media universe, we envisage low single-digit growth in the German TV-advertising market and rate ProSieben (PSMG_p.DE) Buy on accommodative valuation metrics. (3) Software and Hardware: software-driven Internet-based business models like CTS Eventim (EVDG.DE), XING (OBCGn.DE) or TomorrowFocus (TFAG.DE) offer strong secular growth, which, however, comes at a price. We have high conviction that CTS Eventim will emerge as a winner from the current consolidation process in the ticketing industry, which we believe will move towards a global duopoly in the mid-term. In both hardware and software many names also act in different subsectors. Nevertheless, all are acting in the same environment. The key trends continue to be 1) the commoditisation of hardware and, somewhat related, 2) the emergence of cloud. The remedy against the ongoing commoditisation in hardware is mainly by increasing the software content and additional features [Wincor Nixdorf (WING.DE) and Dialog Semiconductor (DLGS.DE)] and works at most companies but there are noticeable exceptions [Kontron (KBCG.DE)]. Hardware sales of many former rising stars, such as the PC or storage, were down double-digits yoy in Q4 and many companies continue to wonder if this is already the ‘cloud’ impact. Either way, companies are taking a different approach. IT Service names like Cancom (COKG.DE) are very proactive and offer their own cloud solutions prominently in the market while Bechtle (BC8G.DE) is much more cautious in order not to lose too much traditional box-shifting business in the first place. Software names like Software AG (SOWG.DE) take a very agnostic stance and increasingly offer cloud solutions to the market and we expect further acquisitions (similar to Terracotta) at this end. We highlight Compugroup Medical and United Internet as our key picks in this sector (see pages 20-21 and pages 32-33, respectively, for details).

Contact Benjamin Kohnke ([email protected]) (+49-69-910-31943), Johannes Schaller ([email protected]) (+49-69-910-31731) and Uwe Schupp ([email protected]) (+49-69-910-31955) for details.

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Figure 47: Sector positioning in Germany over time Figure 48: German SME companies under Deutsche Bank (German Prime All Share Technology sector) coverage within the Technology sector 0.60 1.8

1.6 0.40 Mcap Price TP Upside Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 1.4 0.20 ADVA ADAG.DE H 181 3.8 4.5 18 1.2 AIXTRON AIXGn.DE B 1,126 11.2 14.0 25 0.00 1.0 Dialog Semiconductor DLGS.DE H 687 10.6 15.0 42 0.8 Elmos ELGG.DE H 155 8.0 7.4 (7) -0.20 Euromicron EUCAn.DE H 102 15.4 17.0 11 0.6 Gigaset AG GGS.DE H 46 0.9 1.2 32 -0.40 0.4 Jenoptik JENG.DE H 448 7.8 7.5 (4) Kontron AG KBCG.DE H 234 4.2 3.7 (12) -0.60 0.2 2008 2009 2010 2011 2012 2013 Muehlbauer MUBG.DE H 133 21.7 21.0 (3) Pfeiffer Vacuum PV.DE S 846 85.7 69.0 (19) Sector weight* Prime Technology rel. to Prime All Shares, x (rhs) QSC AG QSCG.DE B 300 2.5 2.8 14 ROFIN-SINAR RSTI.DE H 555 19.5 15.0 (23) SFC Energy AG F3CG.DE B 40 5.4 12.0 123 Singulus Technologies SNGG.DE H 54 1.1 2.5 125 Suess Microtec AG SMHNn.DE H 173 9.0 9.0 (0) Wincor Nixdorf WING.DE B 1,085 36.4 50.0 37 Technology 14 * Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

Figure 49: Sector positioning in Germany over time Figure 50: German SME companies under Deutsche Bank (German Prime All Share Software sector) coverage within the Software sector 0.60 1.8

1.6 0.40 Mcap Price TP Upside Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 1.4 0.20 Bechtle BC8G.DE H 746 35.5 33.0 (7) 1.2 Cancom COKG.DE H 171 15.0 13.0 (13) 0.00 1.0 Compugroup COPMa.DE B 853 17.0 23.0 35 0.8 PSI AG PSAGn.DE B 244 15.5 18.0 16 -0.20 Software AG SOWG.DE B 2,468 28.4 38.0 34 0.6 Tomorrow Focus TFAG.DE H 222 4.2 4.0 (5) -0.40 0.4 United Internet UTDI.DE B 3,753 19.4 22.0 14

-0.60 0.2 Wirecard WDIG.DE H 2,311 20.6 16.0 (22) 2008 2009 2010 2011 2012 2013 XING AG OBCGn.DE H 224 40.8 50.0 23 Sector weight* Prime Software rel. to Prime All Shares, x (rhs) Software 10

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

Figure 51: Sector positioning in Germany over time Figure 52: German SME companies under Deutsche Bank (German Prime All Share Media sector) coverage within the Media sector 0.60 1.8

1.6 0.40 Mcap Price TP Upside Company name Ticker Rec. (EUR m) (EUR) (EUR) (%) 1.4 0.20 Axel Springer SPRGn.DE H 3,365 34.1 42.0 23 1.2 Constantin Medien AG EV4G.DE H 138 1.8 1.4 (21) 0.00 1.0 CTS Eventim AG EVDG.DE B 1,298 27.1 32.0 18 0.8 Kabel Deutschland KD8Gn.DE B 6,201 70.1 61.0 (13) -0.20 ProSiebenSat.1 PSMG_p.DE B 5,794 27.0 29.0 7 0.6 Sky Deutschland SKYDn.DE H 3,439 4.0 4.5 13 -0.40 0.4 Stroeer SAXG.DE B 370 7.9 12.5 57

-0.60 0.2 Media 12 2008 2009 2010 2011 2012 2013 Sector weight* Prime Media rel. to Prime All Shares, x (rhs)

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

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2.3 Investable themes (top-down screenings)

We focus on key investable themes relevant to the international investor base looking at German SMEs with a focus on family businesses, exporters, momentum plays and regional exposure. We have also prepared screens that could be of special interest to conservative, style and income investors.

Overview

2.3.1 German SME family businesses (page 42) One of the most prominent themes among the German SME equity universe in the past has been the selection of “family businesses”. We recommend being selective and highlight CompuGroup, CTS Eventim, Draegerwerk, Duerr, Gerry Weber, Jungheinrich, QSC, SMA, Software AG, Tom Tailor and United Internet as our key picks in this basket.

2.3.2 German SME exporters (page 43) Next to the investment theme of “family businesses”, the screen of “exporters” among corporate Germany is one of the most frequently-requested ones. Fundamentally, we believe it is the one with the greatest upside from the current level and highlight Aixtron, GEA and MTU as key picks among German SME exporters.

2.3.3 Momentum plays (page 44) We screened the German SME universe for “Fallen Angels” (i.e. “out-of-favour stocks poised for a rebound” or buying opportunities) and “Falling Angels” (i.e. “out-of-favour consensus Buys” or selling opportunities). Based on this screening, we recommend owning Air Berlin, Heidelberger Druck and highlight Fielmann, Delticom as Sells.

2.3.4 Regional exposure (page 45) We sorted the German SME equity universe for the Top 20 companies with regional revenue exposure to Germany (home country), Europe ex Germany, Asia/Pacific, the Americas and calculated the historical performances of each basket relative to the German equity market to visualise revenue exposure-related trends.

2.3.5 Designed for conservative investors: High RoE vs. low volatility (page 47) Conservative investors could be interested in owning stocks that 1) offer a high return on equity, 2) are subject to low volatility and 3) can be bought at a reasonable price. In this regard, we highlight Duerr, Wincor Nixdorf, Gerry Weber, CompouGroup, CTS Eventim, United Internet and Hugo Boss as key picks.

2.3.6 Designed for style investors: “Value” vs. “Growth” (page 47) We screened the German SME universe for “Value” and “Growth” stocks and conclude that we prefer “Growth” over “Value” in the mid-term (>12 months forward) based on our analysts’ market cap weighted upside to their target prices. Buy-rated “Growth” stocks with significant upside to our analysts’ target prices include comdirect, MTU, ProSiebenSat.1, PSI AG and Software AG.

2.3.7 Designed for income investors: Dividend screens (page 49) We screened the German SME equity universe for two dividend themes, i.e. “sustainable dividends” and “current dividend yield attractiveness”. Within the “sustainable dividend” screen, Hugo Boss and ProSiebenSat.1 are the only Buy-rated stocks with significant upside to our analyst’s target prices. Among the “current dividend yield attractiveness” screen we highlight CEWE Color, CTS Eventim, Duerr, GEA, QSC and Wincor Nixdorf as key picks.

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2.3.1 German SME family businesses: a diverse universe demands a selective approach One of the most prominent themes within the German SME equity universe in the past has been the selection of “family businesses”. General pros attached to companies where shares are predominantly owned by family members or foundations under the influence of family members include 1) a high level of commitment by the founder family, 2) a long-term focus by company management, 3) an interest in conserving family patrimony and reputation and 4) optimal know-how transferred through generations (intimate knowledge of firm and market). On the other hand, cons include 1) a limited recruitment pool if positions are filled with family members (in other words, there may be better personnel available outside of the family), 2) difficulties finding a successor inside the family which may lead to a less reliable long-term commitment to continue the business and 3) possible conflicts between family members and difficulties agreeing on strategic targets. These frequently-debated pros and cons demand a selective approach when it comes to investing in family businesses – not only among German SMEs but among family businesses in general.

Reviewing the basket’s current status quo based on our analysts recommendations, we observe only 34% of the market cap is Buy-rated while c30% downside implied by our analysts’ target prices requires selective buying as suggested above. Our key picks among German SME family businesses with significant upside and an intact business case include CompuGroup, CTS Eventim, Draegerwerk, Duerr, Gerry Weber, Jungheinrich, QSC, SMA, Software AG, Tom Tailor and United Internet.

Figure 53: German small & mid cap “Family basket” Figure 54: German small & mid cap “Family basket” (basket constituents) (rel. performance and DB recommendation weights) Price & DB rec. 2013E 1) Relative performance versus PRIMALL 200

180

Company Price (EUR) (EUR)TP Rec. Upside (%) EPS Growth (%) yield Div (%) Net debt/ Equity (%) P/E (x) 160 ADVA 3.8 4.5 H 18 (19) 0.0 (36) 11.7 Axel Springer 34.1 42.0 H 23 (15) 5.0 8 13.4 140 Bauer AG 18.9 20.0 H 6 31 2.4 124 9.8 Bechtle 35.5 33.0 H (7) 15 2.9 (17) 11.3 120 Carl Zeiss Meditec 23.3 22.5 H (3) 21 2.2 (35) 21.7 100 Compugroup 17.0 23.0 B 35 11 3.1 84 11.3 CTS Eventim AG 27.1 32.0 B 18 16 2.5 (39) 19.9 80 Delticom AG 36.5 28.0 S (23) (3) 4.3 (35) 20.8 Draegerwerk AG 98.5 115.0 B 17 13 1.0 2 12.2 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Duerr 78.9 95.0 B 20 19 3.4 (26) 10.3 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 ElringKlinger AG 22.5 21.0 H (7) 13 2.4 35 14.7 Equal weight Mkt cap weight Fielmann 73.6 60.0 S (18) 2 3.6 (36) 23.9 Fuchs Petrolub AG 64.7 46.0 H (29) 9 2.1 (29) 20.6 2) DB recommendation weights (Mcap weighted) Gerry Weber 31.7 40.0 B 26 16 2.8 (10) 15.9 Jungheinrich 32.2 32.0 B (1) 9 2.9 (8) 9.5 16% Krones 54.4 38.0 H (30) 7 1.4 (12) 17.5 QSC AG 2.5 2.8 B 14 57 4.6 18 10.5 Rational AG 227.9 na H na 11 3.3 (58) 24.2 34% SMA 17.8 25.0 B 41 NA 0.3 (49) 0.0 Software AG 28.4 38.0 B 34 12 1.8 (22) 10.6 Buy (B) Solarworld AG 1.0 na H na 40 0.0 372 0.0 Hold (H) Symrise 3129H(5)132.43617.6 Tom Tailor 17 19 B 10 33 1.7 83 10.8 Sell (S) United Internet 19 22 B 14 37 1.8 17 17.9 Vossloh 79 70 H (11) (0) 2.5 44 18.2 Wacker Chemie AG 53.7 37.0 S (31) 6 0.9 55 28.2 Wacker Neuson SE 11.2 10.0 H (11) (5) 3.2 18 14.1 50% Family basket 1^ 14 2.4* 14 14.1*

* Median values, ^Market capitalisation weighted. Source: DataStream, Deutsche Bank estimates Source: DataStream, Deutsche Bank estimates

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2.3.2 German SME exporters: Few strong opportunities among a well-known theme Next to the investment theme of “family businesses”, the screen of “exporters” among corporate Germany is one of the most frequently-requested ones. As a first step, we screened for stocks with a significant share of assets within Europe and at the same time a significant share of revenues outside of Europe (>30%) based on 2011 annual reports where data was available. We further conducted a qualitative review to filter for those names which actually pursue an export-oriented business model and excluded service-orientated names. Figure 55 presents our short-list of German SME exporters.

As in the case of family businesses (section 2.3.1 above), German SME exporters in aggregate outperformed German equity market (PRIMALL) during the early stage of the pre-crisis period. As we still see 2013 as a year of transition, with average growth in both advanced economies and emerging market economies returning to trend later this year and next, we remain positive on this theme in aggregate but see limited upside potential from here. As in the case of our family basket, we recommend selective buying and highlight Aixtron, GEA and MTU as our key picks among the German SME exporter screen with significant upside and an intact business case.

Figure 55: German small & mid cap “Exporter basket” Figure 56: German small & mid cap “Exporter basket” (basket constituents) (re. basket performance relative to PRIMALL) Price & DB rec. 2013E 1) Relative performance versus PRIMALL 170 160 150 140

Company Price (EUR) (EUR)TP Rec. Upside (%) EPS Growth (%) yield Div (%) Net debt/ Equity (%) P/E (x) 130 ADVA 3.8 4.5 H 18 (19) 0.0 (36) 11.7 120 110 AIXTRON 11.2 14.0 B 25 92 0.0 (19) 0.0 100 Carl Zeiss Meditec 23.3 22.5 H (3) 21 2.2 (35) 21.7 90 GEA 25.4 30.0 B 18 3 2.6 6 10.8 80 70 Koenig & Bauer AG 17.9 12.0 H (33) 41 1.1 (14) 18.0 Kontron AG 4.2 3.7 H (12) NA 1.9 (3) 17.4 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 MTU 73.0 78.0 B 7 21 2.2 31 15.1 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Pfeiffer Vacuum 85.7 69.0 S (19) (0) 3.9 (32) 16.8 Equal weight Mkt cap weight Sartorius (Pref) 78.9 77.0 H (2) 13 1.4 62 18.9 2) DB recommendation weights (Mcap weighted) Wacker Chemie AG 53.7 37.0 S (31) 6 0.9 55 28.2

Exporter basket 1^ 47 1.6* 18 17.1* 22%

Buy (B) Hold (H)

58% Sell (S) 20%

* Median values, ^Market capitalisation weighted. Source: DataStream, Deutsche Bank estimates Source: DataStream, Deutsche Bank estimates

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2.3.3 Momentum plays: screening for “Fallen-/ and falling angels” We screened the German SME equity universe for stocks that out(under)performed the market (PRIMALL) significantly over the past 5 years (by at least 50%) and under(out)performed the market over the past 3 months (by at least 10%) to screen for momentum plays.

ƒ 1) “Fallen Angels” (buying opportunities): In our “Fallen Angels” screen (i.e. “out- of-favour stocks poised for a rebound”) we prefer Buy-rated stocks under Deutsche Bank coverage. In this regard, we highlight Air Berlin and Heidelberger Druck, where we believe relative momentum could persist going forward.

1.1) Air Berlin (AB1.DE; Buy; target price: E3.5): We upgraded Air Berlin to Buy in February this year. Air Berlin has raised equity each year since its IPO in 2006 (with the exception of 2012, when it sold its frequent flyer programme to improve its equity). We think the Turbine restructuring programme that is now being implemented is the last chance for the company – and we think it will be a success. Over the upcoming quarters, we expect a gradual earnings improvement, bringing Air Berlin close to breakeven in FY13. We think investors will regain have confidence in Air Berlin’s future and that the stock should become appealing again for a broader range of market participants. 1.2) Heidelberger Druck (HDDG.DE; Buy; target price: E2.5): In May 2012, we upgraded Heidelberger Druck on back of signs of a industry-specific market recovery. After four years of net losses and four restructuring plans, we thought Heidelberger Druck might be starting to turn the corner. The latest plan was the first not to assume a market recovery and there are signs that the sheetfed equipment market had stabilised. The recent Q3 FY 2013 reporting brought the first operating profit after 14 consecutive quarters of losses, we observe cost reductions kicking in and a healthy backlog. We are increasingly optimistic that Heidelberg can become sustainably profitable, which is the key assumption of our Buy case.

ƒ 2) “Falling Angels” (shorting opportunities): In our “Falling Angels” screen (i.e. “out-of-favour consensus Buys”) we prefer Sell-rated names under Deutsche Bank coverage. Although Delticom and Fielmann do not appear in this screen, we note that our analysts recently downgraded these names to Sell with significant downside to their target prices.

2.1) Delticom (DEXGn.DE; Sell; target price: E28.0): We downgraded Delticom in November 2012 as we believed the competition in Delticom's core market had increased significantly and that the company was forced to strongly incentivise sales at the expense of margins at that time. Structural concerns on the outperformance and profitability potential will continue to outweigh the opportunity of a technical bounce back. We continue to hold this view. For that, the valuation is too rich in our view at 20x 2013E earnings. Sell.

2.2) Fielmann (FIEG.DE; Sell; target price: E60.0): The current valuation levels do not reflect the weaker fundamental outlook for Fielmann, in our view. We forecast a slowdown in sales growth due to fewer store openings, rising online competition and structurally flat markets as well as no growth contribution from contact lenses. Simultaneously, we expect a continued increase in costs, mainly from higher personnel expenses. Both effects put pressure on EPS growth at a time when its premium valuation no longer offers margin for error. Sell.

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Figure 57: “Fallen angels” (out-of-favour and poised for a Figure 58: “Falling angels” (out-of-favour consensus rebound stocks; i.e. buying opportunities) Buys; i.e. selling opportunities)

Price & DB rec. Relative performance Price & DB rec. Relative performance

Company Company Price (EUR) (EUR)TP Rec. Upside (%) 3M Rel. perf. Prime aganist (%) All 5Y Rel. perf. Prime against (%) All Price (EUR) (EUR)TP Rec. Upside (%) 3M Rel. perf. Prime aganist (%) All 5Y Rel. perf. Prime against (%) All Air Berlin 2.1 3.5 B 64 38 (86) Adva 3.8 4.5 H 19 (10) 55 Celesio Ag 14.7 13.5 H (8) 11 (66) Aurubis 46.3 58.0 H 25 (16) 64 Heidelberger Druck 1.6 2.5 B 61 20 (98) Dialog Semiconductor Plc 10.9 15.0 H 38 (24) 722 Kloeckner & Co. 10.4 9.5 H (9) 12 (76) Gerry Weber 32.4 40.0 B 23 (12) 171 Loewe 3.1 na H na 13 (88) Nordex 5.0 3.0 H (40) 60 (95) Stada Arzneimittel Ag 29.5 33.0 B 12 15 (51) Source: DataStream, Deutsche Bank calculations and estimates Source: DataStream, Deutsche Bank calculations and estimates

2.3.4 Regional exposure: sorting German SMEs for regional top-line exposure Companies publish regional revenue exposure based on individual reporting clusters. We aggregated revenues based on FY 2011 data for those categories with the most common overlays, i.e. home country (Germany), rest of Europe (Europe ex Germany), the Americas, Asia/Pacific and we declared the remaining share as “rest of world/unspecified”.

Based on these aggregations, we sorted the German SME equity universe for the Top 20 companies with revenue exposure to the respective clusters and calculated the historical performances of each basket relative to the German equity market to visualise revenue exposure related trends (compare Figure 59, Figure 60).

Figure 59: Regional performance baskets of German small Figure 60: Regional performance baskets of German small & mid caps versus Prime All Shares (equal weights) & mid caps versus Prime All Shares (Mcap weights) 170 160 160 150 150 140 140 130 130 120 120 110 110 100 100 90 90 80 80 70 70 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13

Germany Europe Ex Germany Outside Europe Asia Americas Germany Europe Ex Germany Outside Europe Asia Americas

Source: DataStream, Deutsche Bank calculations Source: DataStream, Deutsche Bank calculations

ƒ Asia/Pacific exposure >25%: AIXTRON, Dialog Semiconductor, Wacker Chemie AG, Heidelberger Druck, Koenig & Bauer AG, SGL Group SE and Pfeiffer Vacuum. ƒ Americas exposure >25%: MTU, Kontron AG, Carl Zeiss Meditec, Gerresheimer, PUMA SE, Kloeckner & Co., Symrise and Brenntag. ƒ Europe (ex Germany) exposure >50%: Morphosys, Stada Arzneimittel AG, TUI AG, Jungheinrich, Deutz AG, Stratec, Rational AG, Tomorrow Focus and Celesio.

ƒ Germany >75%: (see Figure 61).

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9 April 2013 Made in Germany Special Report

Figure 61: “Domestic German exposure” (Top 20 stocks Figure 62: “European exposure (ex GER)” (Top 20 stocks with significant exposure to Germany, FY 2011) with significant exposure to Europe ex GER, FY 2011)

Price & Rec. 2013E Revenue exposure Price & Rec. 2013E Revenue exposure % of sales 2011 % of sales 2011 bt/ e (%) (%) Δ Δ d

t e

Company Price Target Price Rec. Upside (%) EPS (%) yield Div. N Equity (%) P/E (x) country Home Rest Europe of Americas Pacific Asia/ RoW Price Target Price Rec. Upside (%) EPS Company (%) yield Div. Net debt/ Equity (%) P/E (x) country Home Rest of Europe Americas Pacific Asia/ RoW

Rhoen Klinikum 16.3 16.6 H 2 40 2.2 41 17.4 100 0000 Morphosys 31.0 43.0 B 39 NA 0.0 (33) 0.0 4 81 12 3 0 QSC AG 2.5 2.8 B 14 57 4.6 18 10.5 100 0000 Stada Arzneimittel AG 30.3 33.0 B 9 16 1.7 102 10.6 28 68 na na 4 Freenet AG 18.4 17.0 B (8) (4) 6.5 31 10.1 100 0000 TUI AG 7.9 10.3 B 31 (13) 0.0 0 nm 27 66 4na2 Air Berlin 2.2 3.5 B 57 (9) 0.0 520 0.0 100 0000 Jungheinrich 32.2 32.0 B (1) 9 2.9 (8) 9.5 27 66 na na 7 Tipp24 41.0 50.0 B 22 (38) 12.2 (106) 12.1 100 0000 Deutz AG 3.8 na H na 53 0.0 21 12.3 18 56 12 8 6 Alstria 9.0 10.7 B 19 18 6.5 96 13.8 100 0000 Stratec 34.3 32.0 H (7) 29 2.0 (26) 21.0 18 54 na na 29 Deutsche Wohnen 13.6 15.5 H 14 29 2.5 141 20.2 100 0000 Rational AG 227.9 na H na 11 3.3 (58) 24.2 15 51 15 13 6 GSW 29.4 36.0 B 23 25 3.5 117 18.4 100 0000 Tomorrow Focus 4.2 4.0 H (5) 16 1.9 12 13.5 50 50 000 Prime Office 3.4 3.5 H 2 (97) 2.0 139 357.6 100 0000 Celesio 14.8 13.5 H (9) 5 2.6 57 11.6 19 50 na na 31 Bertrandt AG 89.6 75.0 H (16) 9 2.5 (14) 16.0 93 na na na 7 Aurubis 46.5 58.0 H 25 7 3.0 9 9.5 35 49 673 XING AG 40.8 50.0 H 23 9 1.6 (106) 21.0 90 10000 Vossloh 79.0 70.0 H (11) (0) 2.5 44 18.2 22 48 9183 United Internet 19.4 22.0 B 14 37 1.8 17 17.9 90 na na na 10 Wincor Nixdorf 36.4 50.0 B 37 36 3.9 27 12.7 26 48 10 16 0 Deutsche EuroShop 30.8 33.0 H 7 20 4.1 113 15.2 88 na na na 12 Kloeckner & Co. 10.2 9.5 H (7) NA 0.0 27 109.7 24 46 29 0 1 Singulus Technologies 1.1 2.5 H na 50 0.0 (43) 54.3 87 3730 GfK 40.2 39.5 H (2) 7 2.0 30 14.3 27 45 19 9 0 Hawesko 43.0 40.0 H (7) 27 3.8 (2) 19.6 86 12 na na 2 LEONI 29.4 27.0 H (8) (37) 3.1 27 9.8 29 42 na na 29 Fraport AG 43.3 52.0 B 20 (2) 2.9 128 17.2 82 4na7 7 Bilfinger SE 78.4 82.0 H 5 9 3.8 (12) 12.5 40 41 857 HHLA 16.9 17.0 H 1 (21) 3.3 37 22.3 80 16 na na 4 Gerresheimer 43.1 43.0 H (0) 9 1.6 54 15.5 23 39 31 3 3 PSI AG 15.5 18.0 B 16 34 2.7 (41) 19.7 79 na na na 21 ADVA 3.8 4.5 H 18 (19) 0.0 (36) 11.7 26 39 30 5 0 Fielmann 73.6 60.0 S (18) 2 3.6 (36) 23.9 79 21000 Draegerwerk AG 87.5 115.0 B 31 13 1.0 2 12.2 20 38 20 15 6 CTS Eventim AG 27.1 32.0 B 18 16 2.5 (39) 19.9 77 19 na na 4 Wirecard 20.6 16.0 H (22) 15 0.6 (18) 26.5 54 38 na na 7

Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012. Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012. Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates

Figure 63: “Asia/Pacific exposure” (Top 20 stocks with Figure 64: “Americas exposure” (Top 20 stocks with significant exposure to Asia/Pacific, FY 2011) significant exposure to the Americas, FY 2011)

Price & Rec. 2013E Revenue exposure Price & Rec. 2013E Revenue exposure % of sales 2011 % of sales 2011 (%) (%) Δ Δ Price Target Price Rec. Upside (%) EPS (%) yield Div. Net debt/ Equity (%) P/E (x) country Home Rest Europe of Americas Pacific Asia/ RoW Company Price Target Price Rec. Upside (%) EPS (%) yield Div. Net debt/ Equity (%) P/E (x) country Home RestEurope of Americas Pacific Asia/ RoW Company

AIXTRON 11.3 14.0 B 24 92 0.0 (19) 0.0 2 3 6 90 0 MTU 71.7 78.0 B 9 21 2.2 31 15.1 15 10 68 70 Dialog Semiconductor 10.9 15.0 H 38 33 0.0 (45) 11.3 na 16 na 80 4 Kontron AG 4.3 3.7 H (14) NA 1.9 (3) 17.4 na 44 38 na 18 Wacker Chemie AG 55.3 37.0 S (33) 6 0.9 55 28.2 18 24 17 37 3 Carl Zeiss Meditec 23.1 22.5 H (2) 21 2.2 (35) 21.7 43 11 32 14 0 Heidelberger Druck 1.6 2.5 B 61 85 0.0 70 0.0 15 35 18 33 0 Gerresheimer 42.9 43.0 H 0 9 1.6 54 15.5 23 39 31 33 Koenig & Bauer AG 17.0 12.0 H (30) 41 1.1 (14) 18.0 16 36 9 27 13 PUMA SE 231.9 225.0 H (3) 13 0.8 (26) 15.9 na 41 30 22 6 SGL Group SE 30.3 30.0 H (1) (7) 0.8 37 46.7 19 25 23 26 8 Kloeckner & Co. 10.4 9.5 H (9) NA 0.0 27 109.7 24 46 29 01 Pfeiffer Vacuum 84.5 69.0 S (18) (0) 3.9 (32) 16.8 28 28 19 26 0 Symrise 30.6 29.0 H (5) 13 2.4 36 17.6 na 49 29 22 0 Sartorius (Pref) 77.6 77.0 H (1) 13 1.4 62 18.9 17 35 21 23 4 Software AG 27.9 38.0 B 36 12 1.8 (22) 10.6 21 na 23 na 55 PUMA SE 231.9 225.0 H (3) 13 0.8 (26) 15.9 na 41 30 22 6 SGL Group SE 30.3 30.0 H (1) (7) 0.8 37 46.7 19 25 23 26 8 Symrise 30.6 29.0 H (5) 13 2.4 36 17.6 na 49 29 22 0 Duerr 78.6 95.0 B 21 19 3.4 (26) 10.3 15 25 22 na 38 GEA 25.6 30.0 B 17 3 2.6 6 10.8 11 36 20 22 11 Solarworld AG 0.9 na H na 40 0.0 372 0.0 42 18 21 11 8 Bauer AG 18.9 20.0 H 6 31 2.4 124 9.8 27 20 14 21 18 Sartorius (Pref) 77.6 77.0 H (1) 13 1.4 62 18.9 17 35 21 23 4 Gildemeister AG 15.0 na H na 6 2.5 (13) 10.8 38 29 6 19 9 Nordex 5.0 3.0 H (40) NA 0.0 19 100.4 na 75 21 40 Vossloh 79.0 70.0 H (11) (0) 2.5 44 18.2 22 48 9 18 3 GEA 25.6 30.0 B 17 3 2.6 6 10.8 11 36 20 22 11 Wincor Nixdorf 36.7 50.0 B 36 36 3.9 27 12.7 26 48 10 16 0 Draegerwerk AG 86.3 115.0 B 33 13 1.0 2 12.2 20 38 20 15 6 Draegerwerk AG 86.3 115.0 B 33 13 1.0 2 12.2 20 38 20 15 6 KUKA AG 31.1 30.0 H (4) 26 2.0 (26) 15.0 35 23 19 na 23 Carl Zeiss Meditec 23.1 22.5 H (2) 21 2.2 (35) 21.7 43 11 32 14 0 Pfeiffer Vacuum 84.5 69.0 S (18) (0) 3.9 (32) 16.8 28 28 19 26 0 ElringKlinger AG 22.6 21.0 H (7) 13 2.4 35 14.7 31 33 16 14 6 Heidelberger Druck 1.6 2.5 B 61 85 0.0 70 0.0 15 35 18 33 0 Rational AG 229.3 na H na 11 3.3 (58) 24.2 15 51 15 13 6 ElringKlinger AG 22.6 21.0 H (7) 13 2.4 35 14.7 31 33 16 14 6 Jenoptik 7.9 7.5 H (5) 5 2.3 15 11.0 41 31 13 11 4 Jenoptik 7.9 7.5 H (5) 5 2.3 15 11.0 41 31 13 11 4

Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012. Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012. Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates

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2.3.5 Designed for conservative investors: high RoE vs. (low market vol/PB ratio) + yield Conservative investors could be interested in owning stocks that 1) offer a high return on equity (RoE), 2) are subject to low volatility and 3) can be bought at a reasonable price (here, we chose the price-to-book value ratio as a screening criteria instead of the price-to-earnings ratio as the book value of equity is a much more stable variable compared to earnings over time).

Therefore, we sorted the German SME equity universe for the ratio of RoE relative to volume on a three-year historic period based on a 12-month forward basis (8/12 of 2013E and 4/12 of 2014E). Based on this ratio, we display the 50 most attractive names in a scatter plot (see Figure 66). Among those 50 names, we prefer Buy-rated stocks that can be bought at relatively low P/B ratio (see Figure 65).

In this regard, our key picks include Duerr, Wincor Nixdorf, Gerry Weber, CompouGroup, CTS Eventim, United Internet and Hugo Boss.

Figure 65: “Conservative plays” screening Figure 66: “Conservative plays” (recommendations)

Price & DB rec. 12-months forward 70 Superior RoE-to-vol profile

60 Company Price (EUR) (EUR)TP Rec. Upside (%) (x)P/BV (%)RoE (%) Vol RoE/vol (x) (%) Yield Div

Suedzucker 32.3 31.0 H (4) 1.6 14 20 0.7 3.3 50 Gerresheimer 43.1 43.0 H (0) 2.2 14 20 0.7 1.7 Duerr 78.9 95.0 B 20 2.2 23 34 0.7 3.5 Takkt 12.9 12.0 H (7) 2.2 20 24 0.9 2.7 40 Wincor Nixdorf 36.4 50.0 B 37 2.6 24 24 1.0 4.3 Kuka Ag 31.1 30.0 H (4) 2.6 20 27 0.7 2.0

30 Constantin Medien 1.8 1.4 H (21) 2.9 30 29 1.0 0.0 Gerry Weber 31.7 40.0 B 26 3.3 23 26 0.9 2.9 Return on Equity (RoE) 12m fwd 12m (RoE) Equity on Return Symrise 30.6 29.0 H (5) 3.6 19 24 0.8 2.5 20 Bertrandt 89.6 75.0 H (16) 3.6 25 34 0.7 1.7 Xing 40.8 50.0 H 23 3.6 20 28 0.7 1.6 Compugroup Medical 17.0 23.0 B 35 3.7 25 36 0.7 3.3 10 Hawesko 43.0 40.0 H (7) 4.3 23 20 1.2 3.9 y = 0.6141x + 1.6594 Cts Eventim 27.1 32.0 B 18 5.1 29 31 0.9 2.6 Fielmann 73.6 60.0 S (18) 5.2 22 17 1.3 3.6 0 Fuchs Petrolub 64.7 46.0 H (29) 5.3 28 32 0.9 2.2 12.0 17.0 22.0 27.0 32.0 37.0 42.0 47.0 52.0 Delticom 36.5 28.0 S (23) 6.6 36 31 1.2 4.8 Volatility (3-years history) United Internet 19.4 22.0 B 14 7.3 49.4 32.2 1.5 1.9 Hugo Boss 87.4 96.0 B 10 7.9 49.5 37.0 1.3 4.1

Source: DataStream, Deutsche Bank calculations and estimates Source: DataStream, Deutsche Bank calculations and estimates

2.3.6 Designed for style investors: “Value” vs. “Growth” – O/w “Growth” going forward We screened the German SME equity universe for “Growth” and “Value” stocks to provide style-based investors with an overview about how the themes have performed in Germany as well as in Europe and where we see the strongest upside from the current levels. As a starting point, we review German and European “Growth” versus “Value” performance based on MSCI methodology. MSCI uses eight historical and forward looking variables (three for value and five for growth) to classify securities under “Value” or “Growth” indices. Stocks are identified as “Value” based on a low P/B and 12-month forward P/E ratio and a high dividend yield. By contrast, “Growth” stocks are characterised by a high short-/ and long-term forward EPS growth rate, a high current internal growth rate, a high long-term historical EPS growth trend and a high long-term historical sales per share growth trend.

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Figure 67: MSCI “Growth” over “Value” in Germany and Figure 68: MSCI “Growth” Germany over Europe and Europe (net return indices) MSCI “Value” Germany over Europe (net return indices) 30% 10% 20% 0% 10% -10% 0% -20% -10% -30% -20% -40% -30% -40% -50% -50% -60% -60% -70% -70% -80% 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

"Growth"/"Value" Germany "Growth"/"Value" Europe Germany/Europe "Growth" Germany/Europe "Value"

Source: DataStream, Deutsche Bank calculations Source: DataStream, Deutsche Bank calculations

Reviewing the long-term performance of “Value” vs. “Growth” in the German equity universe reveals “Growth” stocks recorded only two periods of relative outperformance versus “Value” stocks, i.e. in the 1980s (1980–87) and the late 2000s (2008-recent). Over the long run, however, “Value” stocks prevailed. The same holds true for “Growth” over “Value” in the European equity universe with the difference that the period from 2008 until recent marked the only period greater than five years with ongoing underperformance relative to “Growth” stocks (Figure 67). Plotting “German Growth(/Value) stocks” against “European Growth(/Value) stocks” indicates European aggregates dominated from the mid-1970s up until the early 2000s. Only after the new economy bubble had burst did German aggregates manage to gain ground again (Figure 68). To help investors identify “Value” and “Growth” stocks among German SMEs, we screened our universe under Deutsche Bank coverage for typical criteria:

ƒ “Value” stocks: Low P/BV, low PE (forward & trailing) and high dividend yield relative to the median value among German stocks under Deutsche Bank coverage. ƒ “Growth” stocks: High long-term EPS growth, high five-year sales growth, high five-year EPS growth and high RoE relative to median value among German stocks under Deutsche Bank coverage. Based on our analysts (market capitalisation weighted) recommendation, we prefer the identified “Growth” over “Value” stocks in aggregate (see Figure 71 and Figure 72).

Figure 69: “Value screen” among German SMEs Figure 70: “Growth screen” among German SMEs (constituents) (constituents) Price & DB rec. "Value" metrics Price & DB rec. "Growth" metrics

Company Company Price (EUR) (EUR)TP Rec Upside(%) (x) PE 12mFwd (x) PE Trailing 12m (%) DY Trailing 12m Price to Book (x) Price (EUR) (EUR)TP Rec Upside(%) CurrentROE (%) (%) growth EPS 5Y 5Y (%) sales growth (%) growth EPS LT Aurubis 46.3 58.0 H 25 9.2 12.7 2.9 1.0 Carl Zeiss Meditec 23.1 22.5 H (2) 12.9 11.7 14.2 13.3 Bauer AG 18.9 20.0 H 6 8.4 6.0 2.6 0.7 comdirect 8.0 9.0 B 12 19.9 7.2 13.4 6.1 C.A.T. oil 8.0 9.5 B 19 11.3 4.2 1.6 1.8 ElringKlinger AG 22.6 21.0 H (7) 15.6 15.3 14.3 7.9 Celesio 14.7 13.5 H (8) 11.1 1.5 2.0 1.0 Hawesko 43.0 40.0 H (7) 18.5 8.7 6.3 6.6 DAB bank 3.6 3.5 H (1) 16.0 9.8 5.9 1.3 MTU 71.778.0 B 918.510.73.914.6 Deutsche EuroShop 30.8 33.0 H 7 16.2 8.6 3.6 1.3 ProSiebenSat.1 26.2 29.0 B 11 20.5 5.9 5.5 9.0 Elmos 8.1 7.4 H (9) 12.7 4.2 3.1 0.8 PSI AG 15.4 18.0 B 17 13.4 13.2 7.7 22.0 Jenoptik 7.9 7.5 H (5) 11.4 16.2 2.3 1.4 Software AG 27.9 38.0 B 36 18.2 12.1 17.9 6.6 Sixt AG 15.5 16.0 H 3 8.6 15.6 6.5 1.3 Stratec 33.8 32.0 H (5) 20.3 19.0 11.2 13.8 VTG AG 13.4 14.0 B 5 13.2 1.7 2.8 0.9 Symrise 30.6 29.0 H (5) 17.2 19.2 5.2 9.8 Source: DataStream, Deutsche Bank calculations and estimates Source: DataStream, Deutsche Bank calculations and estimates

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Figure 71: “Value screen” among German SMEs Figure 72: “Growth screen” among German SMEs

0% 5% 0%

26%

Buy (B) Buy (B) Hold (H) Hold (H) Sell (S) Sell (S)

74%

95% Source: DataStream, Deutsche Bank calculations and estimates Source: DataStream, Deutsche Bank calculations and estimates

2.3.7 Designed for income investors: German small & mid cap dividend screens We screened the German SME equity universe for two dividend themes:

ƒ Sustainable dividend screen (see Figure 73): Investors that are more conservative in nature with a mid-/ to long-term investment horizon should be interested in screening for those names that have produced a stable and growing DPS profile over the past years and where our analysts expect this trend to continue in 2013/14. Hugo Boss and ProSiebenSat.1 are the only Buy-rated stocks with significant upside potential to our analyst’s target prices. ƒ Current yield attractiveness (see Figure 74): Investors interested in owning stocks offering short-term dividend attractiveness should screen for those names with a high dividend yield accompanied by a high dividend cover ratio (FCF per share/DPS), low leverage (net debt/equity) and, most importantly, a solid view on (at least) stable EPS. Stocks offering a high dividend yield but a bleak outlook on growth prospects will not attract investor interest for obvious reasons. According to our screening, we highlight CEWE Color, CTS Eventim, Duerr, GEA, QSC and Wincor Nixdorf as attractive current dividend plays.

Figure 73: “Sustainable dividends” Figure 74: “Current yield attractiveness”

Price & DB rec. 2013E Price & DB rec. 2013E

Company Price (EUR) (EUR) TP Rec. Upside (%) % CAGR DPS (2005-14E) (%) yield Div. (x) cover Div Payout Ratio (%) Company Price (EUR) (EUR)TP Rec. Upside (%) (%) yield Div. Net debt/ EBITDA (%) (x) cover Interest (x) cover Div. Pauout Ratio (%) Stratec 33.8 32.0 H (5) 34 2.0 1.9 42 Axel Springer 34.1 42.0 H 23 5.0 0.3 16.2 2.0 67 Pfeiffer Vacuum 84.5 69.0 S (18) 25 3.9 2.3 75 CEWE COLOR 32.8 38.0 B 16 4.6 0.2 21.7 2.6 50 Fuchs Petrolub AG 64.1 46.0 H (28) 24 2.1 1.6 43 CTS Eventim AG 27.1 32.0 B 18 2.5 -0.8 25.0 2.9 50 ProSiebenSat.1 26.2 29.0 B 11 19 5.5 4.8 80 Duerr 78.9 95.0 B 20 3.4 -0.7 8.8 2.6 35 BayWa 36.2 39.0 H 8 17 3.1 5.2 41 GEA 25.4 30.0 B 18 2.6 0.2 8.4 3.3 30 Hugo Boss 86.7 96.0 B 11 17 4.0 1.2 70 QSC AG 2.5 2.8 B 14 4.6 0.4 9.6 1.9 53 GfK 40.3 39.5 H (2) 15 2.0 3.9 32 Wincor Nixdorf 36.4 50.0 B 37 3.9 0.6 16.3 2.3 50 Fielmann 73.2 60.0 S (18) 13 3.6 1.2 85 Hawesko 43.0 40.0 H (7) 13 3.8 1.1 74 Rhoen Klinikum 16.1 16.6 H 3 12 2.2 3.3 39 Sartorius (Pref) 77.6 77.0 H (1) 11 1.4 3.0 31 Krones 54.2 38.0 H (30) 10 1.4 0.2 25 GRENKE Group 56.4 47.0 H (17) 10 1.6 0.8 28 ElringKlinger AG 22.6 21.0 H (7) 9 2.4 1.4 35 Aurubis 46.3 58.0 H 25 8 3.0 -0.6 49 Source: DataStream, Deutsche Bank calculations and estimates Source: DataStream, Deutsche Bank calculations and estimates

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Appendix A

Market data chart book

Overview

A.1 Key economic indicators (page 51) This section provides investors with an overview of current Deutsche Bank forecasts related to 1) economic growth, consumer prices, current accounts, fiscal balances across regions, 2) forecasts related to FX targets, 3) commodity prices and 4) rates.

A.2 Performance (page 52) This section reviews performance across regions, Prime All Share sectors and identifies German SMEs with the greatest 2013 year-to-date out-/ and underperformance.

A.3 Earnings (page 53) This section presents an overview of latest changes to recommendations, target prices and EPS estimates among Deutsche Bank analysts for German SMEs.

A.4 Consensus recommendation momentum (page 54) In addition to earnings, IBES collects data on ratings and calculates a consensus rating for each company on a scale from 1 to 5 (1 is a strong buy and 5 is a sell). It is especially interesting to look at companies that are among the least (most) preferred and where the recommendation momentum starts to improve (deteriorate). Momentum could flag a change in awareness of the company in the market.

A.5 Directors’ Dealings (page 55) This section monitors Directors' Dealings among German SMEs. Empirical analyses suggest that investors can benefit by mimicking buy transactions in particular.

A.6 Traditional valuation (page 56) This section presents valuation screens sorting German SMEs for lowest P/E, lowest/highest P/B, lowest/highest EV/EBITDA ratios and highest dividend yield.

A.7 Index agglomerations (page 58) We aggregated German as well as European (ex Germany) SME companies (ex- financials) below a market capitalisation of E5bn following the “one-company- approach” to compare metrics across P&L, B/S and CFS statements. Key ratios summarise the most important variables.

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A.1 Key economic indicators

Economic growth, consumer prices, current account and fiscal balances Real GDP Consumer Prices Current Account Fiscal Balance % growth % growth % of GDP % of GDP 2012E 2013E 2014E 2012E 2013E 2014E 2012E 2013E 2014E 2012E 2013E 2014E Global 2.9 3.2 4.0 3.3 3.3 3.6 G7 1.4 1.3 2.2 1.9 1.8 2.3 US 2.2 2.3 3.2 2.1 2.3 2.6 -3.0 -3.1 -3.4 -6.8 -6.3 -5.3 Japan 2.0 1.4 0.6 0.0 0.0 2.0 1.0 1.2 2.3 -9.6 -9.4 -7.4 Euroland -0.6 -0.6 1.0 2.5 1.6 1.6 1.2 1.7 1.6 -3.2 -3.0 -2.6 Germany 0.7 0.3 1.5 2.1 1.7 1.8 7.0 6.3 6.1 0.2 -0.4 -0.2 France 0.0 -0.6 1.1 2.2 1.4 1.5 -2.4 -2.2 -1.9 -4.6 -3.8 -3.2 Italy -2.4 -1.8 0.4 3.3 1.8 1.6 -0.6 0.4 0.4 -3.0 -2.6 -2.8 UK 0.3 0.5 1.8 2.8 3.0 2.6 -3.7 -3.1 -2.5 -7.8 -7.1 -6.4 Latin America 5.9 6.8 7.5 3.8 3.9 4.2 1.4 0.9 0.6 -2.8 -3.0 -2.5 EEMEA 2.8 3.5 4.0 7.8 8.3 8.2 -1.3 -1.4 -1.6 -2.6 -2.3 -1.9 Source: Bloomberg Finance LP, Deutsche Bank Global Markets Research

Deutsche Bank quarterly GDP growth forecasts GDP growth (% qoq saar / annual: % yoy Q1 12 Q2 12 Q3 12 Q4 12 2012E Q1 13E Q2 13E Q3 13E Q4 13E 2013E 2014E G7 1.9 0.3 1.3 -0.5 1.4 1.8 1.8 2.2 2.5 1.3 2.2 US 2.0 1.3 3.1 0.4 2.2 3.0 2.3 3.0 3.5 2.3 3.2 Japan 6.1 -0.9 -3.7 0.2 2.0 3.1 3.4 2.6 2.5 1.4 0.6 Euroland 0.2 -0.7 -0.3 -2.3 -0.6 -1.0 0.0 0.7 0.8 -0.6 1.0 Germany 2.0 1.1 0.9 -2.4 0.7 0.6 1.5 1.7 1.0 0.3 1.5 France 0.2 -0.4 0.7 -1.2 0.0 -1.3 -0.5 0.2 0.7 -0.6 1.1 Italy 3.7 -3.0 -0.8 -3.7 -2.4 -2.3 -1.2 0.0 0.4 -1.8 0.4 UK 0.3 -1.5 3.8 -1.2 0.3 -0.2 0.6 1.0 1.5 0.5 1.8

Deutsche Bank FX forecasts End period Current 05/04/2013 Dec-12 Mar-13 Jun-13E Sep-13E Dec-13E EUR/USD 1.30 1.29 1.28 1.26 1.23 1.20 USD/JPY 97 78 94 96 98 100 EUR/JPY 127 100 121 121 121 120 GBP/USD 1.54 1.61 1.52 1.45 1.43 1.41 EUR/GBP 0.85 0.80 0.85 0.87 0.86 0.85 Source: National Statistics Offices, Bloomberg Finance LP, Deutsche Bank Global Markets Research

Deutsche Bank Commodity forecasts End period Current units 05/04/13 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Brent Oil USD/bbl 104.8 109.6 112.0 115.0 115.0 110.0 112.0 115.0 116.0 Aluminium USD/tn 1851 1875 2250 2150 2000 2200 2200 2200 2200 Copper USD/tn 7377 7510 8500 8000 7800 7500 7500 7500 7500 Gold USD/oz 1566 1596 1825 1875 2000 1950 1900 1900 1850 Source: National Statistics Offices, Bloomberg Finance LP, Deutsche Bank Global Markets Research

Deutsche Bank Fixed Income forecasts 3-month interest rates 10-year government bond yield End period (in %) Current Current 05/04/2013 Jun-13 Sep-13 Mar-14 05/04/2013 Jun-13 Sep-13 Mar-14 US 0.28 0.35 0.35 0.35 1.69 2.35 2.50 3.00 Japan 0.25 0.30 0.30 0.30 0.53 0.70 0.80 0.90 Euroland 0.21 0.25 0.25 0.35 1.22 1.65 1.75 2.00 UK 0.50 0.51 0.52 0.60 1.65 2.25 2.45 2.90

Source: National Statistics Offices, Bloomberg Finance LP, Deutsche Bank Global Markets Research

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A.2 Performance

This section reviews performance across regions, Prime All Share sectors and identifies German SMEs with the greatest 2013 year-to-date out-/ and underperformance.

Figure 75: 1M vs. 3M performance (regions) Figure 76: 1M vs. 3M performance (Prime sectors)

TOPIX 8.8% Consumer 5.3% 1M Utilities 1M 5.2% S&P 500 1.1% 3M 3M 0.7% Telecommunication 2.5% SDAX Pharma & Healthcare 2.0% 0.3% MSCI World Retail 1.6% MDAX 0.2% Insurance 0.8% Media -1.7% DAX 30 -0.3% Construction -2.0% Stoxx 50 -1.1% Industrial -2.3% -2.0% Stoxx 600 Prime All Share Index -2.7%

FTSE 100 -2.3% Chemicals -3.1% Software -4.0% MSCI AC Asia-ex-Japan -2.5% Financial services -4.8% TECDAX -2.6% Food & Beverages -4.9% -2.7% HDAX Transportation & Logistics -5.4% -6.0% CAC 40 -3.1% Technology Automobile -8.8% Eurostoxx 50 -3.5% Banks -12.8% MSCI EMEA -3.9% Basic resources -13.5%

-10% -5% 0% 5% 10% 15% 20% 25% -25% -15% -5% 5% 15% Source: DataStream, Deutsche Bank estimates and calculations Source: DataStream, Deutsche Bank estimates and calculations

Figure 77: Strongest outperforming stocks 2013 YTD Figure 78: Strongest underperforming stocks 2013 YTD (Prime All Shares

Rel. to Rel. Rel. to Rel. Rel. to Rel. Rel. to Rel. S. Target Prime. Prime Prime. Prime S. Target Prime. Prime Prime. Prime No. Company Price Price Rec. Sector Index Sector Index No. Company Price Price Rec. Sector Index Sector Index

1Nordex 5.0 3.0 H 62 68 -41 -26 1Salzgitter 30.3 36.0 H -7 -23 -13 0 2Air Berlin 2.1 3.5 B 37 39 -82 -41 2Dialog Semiconductor10.9 15.0 H -20 -18 23 3Koenig & Bauer AG 17.0 12.0 H 27 34 8243Singulus Technologies 1.2 2.5 H -23 -17 -50 -35 4Sartorius 86.5 47.0 B 22 32 95 111 4YOC AG 7.1 NA H -17 -17 -51 -47 5 Freenet AG 18.3 17.0 B 30 31 32 37 5Euromicron 15.6 17.0 H -16 -14 11 12 6 Zooplus AG 41.2 50.0 B 23 29 -20 -29 6 Aurubis 46.3 58.0 H 2 -14 16 29 7 Draegerwerk AG 98.1 115.0 B1728 5217Evotec 2.3 2.6 H -24 -14 -5 11 8AIXTRON 11.3 14.0 B 26 27 -14 -14 8Software AG 27.9 38.0 B -13 -13 -35 9 9Heidelberger Druck 1.6 2.5 B 20 26 -25 -10 9Solarworld AG 0.9 NA H -19 -13 -83 -68 10 Villeroy & Boch 8.3 7.0 H 10 24 -22 13 10 ElringKlinger AG 22.6 21.0 H -7 -11 -8 28 Source: DataStream, Deutsche Bank estimates and calculations Source: DataStream, Deutsche Bank estimates and calculations

Page 52 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

A.3 Earnings

This section presents the latest changes to recommendations, target prices and EPS estimates among Deutsche Bank analysts for German SMEs (

Figure 79: Recommendation and estimates changes by Figure 80: Prime All Share stocks (

Deutsche Bank AG/London Page 53

9 April 2013 Made in Germany Special Report

A.4 Consensus recommendation momentum

In addition to earnings, IBES collects data on ratings and calculates a consensus rating for each company on a scale from 1 to 5 (1 is a strong buy and 5 is a sell). The tables below show German SMEs (Aareal Bank 16.2 20.7 28.0 2.00 0.23 -0.18 7 SMA 18.2 18.8 3.0 3.30 0.27 0.51 8 Bilfinger SE 77.1 83.0 7.6 2.00 0.08 0.13 8Rational AG 229.3 230.4 0.5 3.20 -0.20 -0.45 9 GSW Immobilien 8.0 9.7 20.9 2.00 -0.08 -0.08 9 Fuchs Petrolub AG 64.1 52.9 -17.4 3.20 0.19 -0.09 10 Gerresheimer 42.9 47.8 11.4 2.00 0.13 0.33 10 KUKA AG 31.1 31.4 0.8 3.14 -0.30 -0.31 11 Jungheinrich 31.8 36.7 15.3 2.00 -0.12 -0.37 11 PUMA SE 231.9 234.3 1.0 3.10 -0.06 -0.10 12 QSC AG 2.4 2.9 20.1 2.00 0.25 0.75 12 Delticom AG 35.9 40.4 12.5 3.10 -0.17 -0.10 13 Tom Tailor 17.3 21.1 22.1 2.00 -0.09 -0.09 13 Carl Zeiss Meditec 23.1 23.8 3.1 3.10 0.06 -0.10 14 Dialog Semiconductor 10.9 17.0 56.3 2.20 0.08 0.18 14 Air Berlin 2.1 2.1 0.0 3.10 0.72 1.07 15 Duerr 78.6 87.2 11.0 2.20 -0.14 -0.08 15 Vossloh 79.0 75.9 -3.9 3.00 -0.13 -0.14 *Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is *Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank

A.4.2) Companies with highest improvement and decline in consensus recommendation Figure 83: Companies with highest 1M improvement in Figure 84: Companies with highest 1M decline in consensus recommendation (IBES consensus) consensus recommendation (IBES consensus) 05-Apr-13 Consensus Rec. * 05-Apr-13 Consensus Rec. * upside upside S. Curr. Target poten. 1M 1W S. Curr. Target poten. 1M 1W No. Company Price price(%) Curr. chng chng No. Company Price price(%) Curr. chng chng 1 Air Berlin 2.1 2.1 0.0 3.10 0.72 1.07 1 IVG Immobilien AG 0.6 1.8 198.2 3.36 -0.63 -0.57 2Kloeckner & Co. 10.4 10.7 2.2 2.70 0.48 0.51 2 ElringKlinger AG 22.6 23.1 2.3 3.60 -0.55 -1.01 3 Rhoen Klinikum 16.1 16.3 1.2 2.30 0.30 0.18 3 Praktiker 1.1 1.5 32.4 3.90 -0.34 0.30 4 SMA 18.2 18.8 3.0 3.30 0.27 0.51 4 KUKA AG 31.1 31.4 0.8 3.14 -0.30 -0.31 5 QSC AG 2.4 2.9 20.1 2.00 0.25 0.75 5 Kontron AG 4.3 3.9 -10.0 2.90 -0.26 -0.40 6Wincor Nixdorf 36.7 39.5 7.7 2.70 0.25 -0.18 6 Rheinmetall 35.2 43.0 22.2 2.50 -0.21 -0.33 7Aareal Bank 16.2 20.7 28.0 2.00 0.23 -0.18 7 Rational AG 229.3 230.4 0.5 3.20 -0.20 -0.45 8 GEA 25.6 28.1 9.9 2.30 0.23 0.17 8 Wirecard 20.3 21.2 4.6 2.29 -0.17 -0.35 9 Krones 54.2 51.2 -5.7 2.90 0.21 0.21 9 Delticom AG 35.9 40.4 12.5 3.10 -0.17 -0.10 10 GAGFAH 9.0 8.8 -2.4 2.80 0.20 0.20 10 Duerr 78.6 87.2 11.0 2.20 -0.14 -0.08 11 GfK 40.3 43.1 7.1 2.40 0.20 0.13 11 Vossloh 79.0 75.9 -3.9 3.00 -0.13 -0.14 12 TAG Immobilien AG 8.7 9.4 9.1 2.60 0.20 0.10 12 Jungheinrich 31.8 36.7 15.3 2.00 -0.12 -0.37 13 Wacker Neuson SE 11.3 12.2 8.1 2.80 0.20 0.38 13 Tom Tailor 17.3 21.1 22.1 2.00 -0.09 -0.09 14 Fuchs Petrolub AG 64.1 52.9 -17.4 3.20 0.19 -0.09 14 Stada Arzneimittel AG 29.5 30.0 1.6 2.50 -0.08 -0.15 15 TUI AG 7.8 9.1 16.1 2.30 0.17 -0.08 15 GSW Immobilien 8.0 9.7 20.9 2.00 -0.08 -0.08 *Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is *Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank

Page 54 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

A.5 Directors’ Dealings

This section monitors Directors' Dealings among German SMEs (

Figure 85: Directors’ dealings for PRIMALL SMEs Figure 86: Stocks with highest net buying (Q1 2013)

1) Directors’ Buying Purchase Sale Net Purchase Company Vol (EUR) Vol (EUR) Vol (EUR) 25,000 (EUR k) RIB Software AG 6,200,000 6,200,000 GRENKE Group 4,463,925 4,463,925 20,000 Gerry Weber 361,066 361,066 YOC AG 222,981 222,981 15,000 Gerresheimer 211,550 211,550 Muehlbauer 194,869 194,869 10,000 Ahlers 65,800 65,800 Euromicron 62,400 62,400 5,000 MOLOGEN AG 52,417 52,417 INTERSHOP COMM. 37,470 37,470 0 EXCEET GROUP SE RED. A 34,956 34,956 TAG Immobilien AG 30,488 30,488 Jan-13 Jan-12 Jan-11 Jan-10 Sep-12 Sep-11 Sep-10 Sep-09 May-12 May-11 May-10 May-09 Jetter AG 30,293 30,293 Companies Bought in past 10 days Companies Bought in past 50 days SAG SOLARSTROM AG 29,200 29,200 ElringKlinger AG 26,050 26,050 H&R AG 24,288 24,288 2) Directors’ Selling Quanmax AG 17,320 17,320 Wacker Chemie AG 16,134 16,134 20,000 (EUR k) Pulsion Medical Systems 20,000 4,054 15,946 18,000 BB BIOTECH 15,783 15,783 16,000 AAP Implantate 13,340 13,340 14,000 Software AG 8,700 8,700 12,000 Suedzucker 5,895 5,895 10,000 Rational AG 5,014 5,014 8,000 IVU Traffic Technologies 3,816 3,816 6,000 Alphaform 323 323 4,000 comdirect 8,567 -8,567 2,000 CropEnergies 10,452 -10,452 0 Advanced Vision 11,571 -11,571 GEA 16,578 -16,578 Jan-10 Jan-11 Jan-12 Jan-13 Sep-09 Sep-10 Sep-11 Sep-12 May-09 May-10 May-11 May-12 Progress-Werk 17,005 -17,005 Companies Sold in past 10 days Companies Sold in past 50 days C.A.T. oil 30,608 -30,608 Hugo Boss 35,592 -35,592 Sky Deutschland 70,950 -70,950 3) Net directors’ Buying Krones 100,100 -100,100 Carl Zeiss Meditec 120,588 -120,588 20,000 (EUR k) WILEX AG O.N. 170,040 -170,040 15,000 MBB INDUSTRIES AG 201,956 -201,956 SAF Holland SA 391,300 -391,300 10,000 INIT Innovation In Traffic 411,923 -411,923 5,000 Eckert & Ziegler 451,350 -451,350 0 SGL Group SE 498,378 -498,378 Qiagen 1,820,025 -1,820,025 -5,000 Name 6,080,000 -6,080,000 -10,000 Tipp24 6,748,590 -6,748,590 Duerr 15,748,928 -15,748,928 -15,000 Jan-10 Jan-11 Jan-12 Jan-13 Sep-09 Sep-10 Sep-11 Sep-12 May-09 May-10 May-11 May-12

10-day Director Net Buying in '000s 50-day Director Net Buying in '000s

Source: Deutsche Bank Equity Strategy, 2iQ Research Source: Deutsche Bank Equity Strategy, 2iQ Research

Deutsche Bank AG/London Page 55

9 April 2013 Made in Germany Special Report

A.6 Traditional valuation

Figure 87: German Small & Mid caps (

Figure 89: German Small & Mid caps (

Figure 91: German Small & Mid caps (

Page 56 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

(total/up/down) ratio 12m fwd. analyst revision analyst 12m fwd.

Earnings (index points) (index Earnings Growth(YoY, %) P/E(x) ratio 12mfwd. company revision Revisions 1m/3m/6m (%) Uncertainty (%) -1.1/-2.2/-7.5-0.7/-2.7/-5.6 -1.1/-2.3/-5.5 +0.2/+0.2/-1.5 -0.7/-1.3/-2.8-1.2/-2.3/-7.4 +0.7/+2.3/+3.0-1.2/-2.3/-7.3 9.2 11.7 -0.9/-2.0/-5.2 9.8 12.2 -0.9/-1.9/-5.1 -0.5/-0.9/-2.1 11.1 12.5 -0.5/-0.8/-1.9 9.6-0.4/-0.7/-4.3 9.8 10.2-1.7/-4.1/-7.6 10.4 11.3 -1.0/-2.0/-4.2-0.4/-0.5/-0.1 11.4 -1.6/-3.1/-4.4 -0.3/-0.3/-1.0-2.3/-4.9/-8.0 -0.2/-0.4/+0.6 -0.8/-1.4/-0.1 8.0 -0.1/+0.5/+5.8 -1.5/-2.3/-5.4 10.8 8.8 4.2 -3.9/-3.6/-5.4 11.4 10.0 (870/109/208) (761/104/143) 15.9 13.0 5.7 -0.11 -0.05 17.2 6.1 15.0 (1887/236/398) -0.09 (2358/284/448) -0.07 (195/26/43) -0.09 (58/7/15) -0.14 (160/21/45) -0.15 (157/13/35) -0.14 -2.8/-7.5/-9.9-2.0/-2.2/-4.5 -0.8/-6.2/-8.5 -1.6/-1.9/-4.3 -2.4/-3.6/-11.8-0.1/-1.9/-1.5 -2.4/-1.8/-2.6 9.0 -0.3/-1.8/+0.1 10.0 7.1 -0.9/+1.4/+10.8 7.4 8.0 5.8 6.2 6.5 5.8 (50/12/17) -0.10 (216/28/68) -0.19 (141/7/20) -0.09 +0.2/-0.1/-6.7 +0.6/+1.2/+2.1 +0.9/+0.6/+2.0 12.7 9.7 11.3 (514/76/44) 0.06 -1.9/-3.2/+2.2 -0.9/+0.6/+5.2 -5.8/+2.1/+11.7 17.9 17.8 18.4 (40/6/13) -0.18 -6.7/-9.3/-19.8 -3.4/-4.0/-12.9 +1.3/+1.4/-0.9-2.2/-3.0/-10.5 22.9-2.6/-7.7/-15.8 19.4 -1.0/-1.2/-8.3-1.9/-2.9/-12.3 -2.4/-6.1/-10.5 14.2 -0.2/+1.1/-1.9 -1.0/-1.2/-4.4 -4.2/-7.0/-6.2 7.6 -10.0/-6.2/-2.9 23.8 9.5 15.0 13.8 12.9 13.9 25.3 22.6 (256/23/47) -0.09 (164/14/48) -0.21 (73/4/22) -0.25 (48/4/8) -0.08 -5.9/-7.2/-46.2 -2.8/-2.6/-23.8 +1.4/-0.3/-21.4-3.7/-8.2/-19.6 22.2 -6.0/-13.9/-24.9 19.1 -5.2/-16.8/-29.4 23.7 7.3 14.6 11.4 (124/14/24) -0.08 (67/4/17) -0.19 -0.1/+0.7/+7.8 +0.2/+0.9/+4.5 +9.2/+7.9/+19.2 8.0 10.3 13.3 (16/0/0) 0.00 +1.4/+0.4/-0.5 +1.7/+3.3/+4.1 +4.6/+7.7/+13.8 13.8 14.8 18.3 (145/15/14) 0.01 -1.2/+9.9/-11.0 +2.0/-1.5/-7.2 +2.1/0.0/-2.9 29.5 15.3 13.4 (90/7/4) 0.03 +0.3/+1.4/+1.5 +0.3/+1.0/+0.9 +3.6/+3.9/+1.5 5.9 7.4 8.7 (100/26/11) 0.15 Price 05/04/13 2012 2013e 2014e 2015e 13e 14e 15e 12 13e 14e 15e Germany (DAX 30) (DAX Germany 7658.8 706.2 680.2 772.3 844.8 -3.7 13.5 9.4 11.3 11.8 10.4 9.5 (29/8/21) -0.45 Germany (MDAX)Germany (TECDAX)Germany Share All Prime Automobiles 12922.9 903.5 811.2 39.5Construction 2910.8 900.7Consumer 255.3 929.8 44.9 servicesFinancial 1087.6 & BeveragesFood 157.6 248.8 58.1 1200.9 114.5 635.2 11.0 284.9 751.9 1178.4 38.1 18.3 750.6 75.0 50.7 56.0 130.0 12.8 13.8 68.5 16.7 313.5 15.0 29.4 43.9 12.4 -2.6 11.3 21.8 142.1 54.4 63.2 14.4 23.4 59.3 -27.3 20.6 10.0 15.9 58.0 11.9 13.5 12.3 12.2 (42/17/25) 59.4 10.7 72.1 9.3 -0.19 9.7 56.1 6.4 74.3 8.7 (26/9/14) 7.7 66.0 15.4 81.2 -0.19 7.0 (231/69/100) 60.5 32.0 -0.13 12.9 7.4 -13.4 28.0 14.1 9.2 18.1 -5.4 15.7 12.8 10.9 11.9 21.5 (10/2/8) 7.8 16.0 19.0 9.3 -0.60 14.9 11.2 16.7 13.6 12.9 14.8 12.3 13.7 12.7 (4/1/2) -0.25 (11/3/5) (20/3/11) -0.18 -0.40 (1/0/1) -1.00 Germany (HDAX)Germany Banks resourcesBasic 3954.8Chemicals 346.7 338.8 1684.0Industrials 152.8 93.9 1865.3 387.8 13.6 137.2 136.5 426.5 20.0 143.6 -2.3 189.6 3480.3 14.3 202.3 10.0 25.4 156.7 11.9 12.2 220.8 10.7 45.4 9.7 246.0 30.9 169.3 38.9 47.5 26.1 4.7 20.6 315.2 26.9 14.1 (97/34/60) 9.1 10.2 -0.27 21.5 8.7 12.4 8.1 14.2 8.4 355.7 13.6 6.6 12.5 21.6 5.4 11.5 28.2 (5/3/1) 11.9 0.40 18.2 15.0 11.7 (3/1/2) (8/1/7) 10.3 -0.33 -0.75 (62/27/22) 0.08 Insurance 457.5 51.0 51.7 53.6 54.1 1.3 3.8 0.9 9.3 9.2 8.8 8.7 (3/2/1) 0.33 MediaSoftware 210.1 15.3 15620.5 787.6 15.4 905.9 16.7 1037.5 18.3 1168.4 0.4 15.0 8.3 14.5 13.0 9.7 21.2 14.3 18.4 14.2 16.1 13.1 14.3 12.0 (25/3/9) (6/2/2) -0.24 0.00 Pharma & HealthcarePharma RetailTechnology 2613.7 157.8 157.5 237.1 387.1 5.3 16.1 176.2 13.7 201.8 13.6 -0.2 11.9 24.3 25.0 14.2 16.2 16.3 14.5 22.9 12.7 33.8 nm -15.9 47.7 84.1 13.9 (26/10/8) 36.6 nm 25.3 0.08 17.5 30.1 16.3 9.8 12.1 10.5 (13/5/4) (17/3/6) -0.18 0.08 TelecommunicationsUtilities 107.7 7.5 751.9 8.8 111.8 9.5 80.2 10.1 80.8 18.5 7.6 78.0 6.8 14.5 -28.3 12.3 11.4 0.8 10.7 -3.5 6.3 8.8 8.8 (5/0/3) 9.1 -0.60 (3/0/3) -1.00 Transportation & LogisticsTransportation 457.3 30.7 34.7 44.2 52.8 13.1 27.5 19.4 16.3 14.4 11.3 9.5 (9/3/5) -0.22 Figure 93: German benchmarks and Prime All Share sectors

Source: IBES, DataStream, Deutsche Bank

Deutsche Bank AG/London Page 57

9 April 2013 Made in Germany Special Report

80 60 40 20 -20 -40 100 0 Sales growt h( %) Op. EBITDA /s ales (%) Net debt/(cash) (EUR bn) (%) Net debt/equity ROE ( %) (%) Capital on Return (%) Capital on Return Operating Avg. Net Debt (Cash)/Equity Debt Net Avg. Margin Trends (%) Trends Margin Return Ratios (%) Ratios Return Price Gainers & Losers & Price Gainers (118.0%) - SKYDn.DE DEUTSCHLAND SKY (109.0%) AG -KUKA KU2G.DE (74.9%) - DUEG.DE DUERR (-58.6%) AG -YOC YOCG.DE AG-(-61.9%) GIGASET GGS.DE (-88.1%) - PV CTNG.DE CENTROTHERM 93 95 97 99 01 03 05 07 09 11 13E 5 0 -5 40 35 30 25 20 15 10 93 95 97 99 01 03 05 07 09 11 13E 93 95 97 99 01 03 05 07 09 11 13E -100% -50% 0% 50% 100% 150% 5 0 8 6 4 2 0 -5 25 20 15 10 18 16 14 12 10 -10 -15 -20 2.6 0.8 12 6 13 .8 28.6 E5bn) 9.0 8.8 15 . 1 2 2 .9 12 . 9 11.0 1. 6 1. 6 1.6 10 8 10 8 10 1 15 7 17 4 17 8 16 7 1.6 1. 6 1. 6 1. 5 1.5 2.4 2.3 2.2 2.5 2.8 371.5 -2.3 -5.1 26.2 28.6 162.5-0.2-7.415.222.9 8.1 7.4 8.0 8.7 8.3 7.6 61.4 17.9 19.6 21.6 17.9 13.8 9 5 7 8 10 7 118 12 6 13 2 1.9 2.3 2.3 2.2 2.1 2.3 0.7 0.6 0.7 0.7 0.8 0.8 14 . 5 2 9 . 8 15 .6 16 . 7 18 . 7 17 . 1 -17.6 -71.8 376.6 -3.9 -6.3 26.5 11.6 9 . 0 5 . 5 9 .0 10 . 4 11. 2 13 .0 11. 9 19 . 0 11.5 13 .1 14 . 1 33.8 -14.3 -65.1 161.1 0.8 -6.8 with a market capitalization < 70 80 94 101 103 107 2.52.61.31.72.01.5 53 99 143 129 109 140 1.61.72.02.31.71.4 3.53.33.52.72.70.7 45.0 42.0 -12.6 31.3 -13.8 -61.8 241.2 31.8 31.9 1.4 -18.2 -80.6 6.0 6.1 6.8 8.0 9.1 7.5 3 3 .4 13 . 6 15 . 5 16 .0 2 0 .5 19 . 0 21 16 26 43 83 119 1. 8 2 .5 2 .1 1. 9 1.8 1.8 0.70.50.60.70.70.9 19 . 5 15 .4 14 . 0 12 . 9 17 .4 17 .3 -28.0 -43.0 230.2 30.3 33.0 0.3 8.2 -6.6 -24.6 50.1 44.9 -10.1 16 . 1 2 0 . 9 18 . 1 10 . 3 11. 2 13 .0 10.8 6.7 5.0 6.9 9.0 12.3 91721273552 2.71.61.01.71.81.9 18 32 32 30 23 34 (ex-financials) (including stocks 1. 9 2 .0 1. 6 1. 8 1. 3 1.2 3.5 2.8 2.4 1.7 1.6 1.3 30.5 6.1 3.7 -9.7 -29.8 -40.0 42.2 16.4 17.0 7.6 -9.1 -26.1 4.6 8.2 10.2 12.0 7.9 8.1 20.2 23.9 28.8 48.2 31.7 42.0 3 4 12 16 2 5 2 3 3.2 2.7 2.2 1.8 1.3 1.7 0.2 0.3 0.6 0.8 0.9 0.8 20.8 18.1 21.1 23.4 33.5 20.8 -18.8 42.8 31.8 7.2 5.2 -8.4 000000-1-10-1-1-1-1-2-2-3-3-3-3-2 5.3 4.5 7.6 15.9 14.0 28.0 10 .9 13 . 0 11. 8 14 . 7 18 .4 2 5 . 3 22.8 -20.2 40.6 40.7 15.0 18.8 111123 2.2 2.0 1.8 3.1 2.8 3.5 2221355447121518131618212225 122222 1 1 1 1 2 4 6 13 19 18 18 2 2 3 1 4 9 6 1 7 4 7 9 8 6 9 8 112 115 10 9 1 0000000000000000000000 0000000-10010-1-2-2-15-1-2-10-1 101-3-1-2-11-3-3 0000 1002-1-200 00000222-1-2-2-2-2-334-5-3-14-4-4 100 1687656101524222227353227 -100000 s s P/CFPS (x)P/CFPS Dividend yield(%) 5.5 5.4 7.6 4.7 4.9 Dividend cover(x) 0.7 0.9 1.0 1.3 1.8 Tot al Headline Growt Earnings h (%) -39.2 28.0 SUMMARY Number ofcompanie P/ rat E io Headline (x)Headline growt EPS (%) h P/rat E (x) io FD growt EPS FD h (%)Tot Growt al Earnings FD (%) h -39.2 24.4 28.0 -39.7 23.2Price/BV (x) 22.6 23.3 18.1 -20.6 -39.7 24.7 11.7 23.3 40.6 24.4 -18.4 11.5 42.8 21.0 23.6 2.1 EV/EBIT 12.8 10.9 EV/Operat ing Capit al 1.2 1.7 1.9 2.2 2.7 xetoasetariais000000 1-10000000 110 dividends0000000000000000000000 000000 1211-1222 10000 00000-1-2-20220-11-4-1-101-110 111111112334571011141211111514 00000002-2-200-10310-103-10 back) 1111123222357111314202121202222 0000000 110111233133334 assets 1111111121233455688886 222224571111121625394651576471778382 activities 00000000 1122691215151517202019 operations borrowings 333334681212141620283440464957666762 expense in assets equity from assets tax liquid 00000000-100-1-1-1-2-2-2-2-3-3-3-3 0000000-101111121642-157 flow paid 1230-3522-134 EV/SalesEV/EBITDA 00000 166679 11110023565 55555811111416182331455462657074777868 raised/(bought flow income investing 00000-1-20-102 flow fixed cash other 2.4 0.1Exceptionals/extraordinaries0000000000000 3.3 0.2Income Minorities/preference Net 3.5 0.2 inc/(dec) bn) (EUR FLOW CASH Cash 3.8 Movement in net working cash capit al and Capex intangible Free Other Equity 00000 1355555691013141516161613 Dividends Net flows liabilities financing cash from financing Other flows 00000000 11111111112222 cash Total Net Movement shareholders' in net debt / (cash) bn) (EUR SHEET BALANCE Cash 0Tangible -1Goodwill 0Other Associates/investments -1 0Total assets -1Int erest bearingdebt Other 0To t -1 a l l i aShareholders' b i equit l y i t i eMinorities s 1 -1Total capital working Net Net debt -1 0 (cash) Capit al 1 ANALYSIS RATIO -1 0Sales growt h (%) 7(%) EBITDA/ sales Op. 2 1 -2 (%)EBIT/ sales 0Payout 7 rat io (%) -2ROE ( 2 %) 6 1Ret urn on Capit 1 al (%) 8Operat ingRet urn on Capit al -2 (%)Capex/ (%) sales 2 1 6 0Ca p e x / d 5.1 8 e -2Net p debt r / -5.2 e equit c y (%) i a t i 2 1 o n 6 ( x 2.1 ) 0 5.7 -3 6.3 8 0.9 3.9 136 2 8.5 1 5.5 6 0 8.3 -3 14 1.7 10.6 115 5.1 5.8 -5.1 5 4 6 0 -5 6.2 21 1.8 11.3 104 7 -29.5 . 4.4 8 6.0 13.9 1. 5 10.3 -20.7 8 5 6.2 -8 -1 10 1.7 25 74 20.7 6.3 9 . 6 7.3 -16.0 16.4 1. 6 2.4 5.4 10.4 10 -9 36 -1 3.3 16 55 7 -21.2 10 .7 8.0 15.6 1.5 7.5 9.0 21.7 4.1 -3.8 10 36 -8 -1 11.9 52 10 7.9 18 9 .1 2 0.9 . 4.4 5.5 3.8 -2.1 2 6.5 39 -8 -1 9 9.8 13 . 51 10 7 2 5 -4.3 27.1 3.8 6.4 4.3 1.1 6.1 -10 8.5 49 14 . -1 5 63 10 12 84.4 -3.8 2 5 4.8 5.4 3.7 4.2 -12 1. 5 76.4 8.5 12 .8 69 -0.1 -1 55 13 16 2 3.3 2.9 4.5 7 3.7 66.3 -9 10.1 1.8 105 8 7.0 . 0 74 24 21 -1 10.2 2.8 45.4 5.2 11.5 10.1 3 3 128 -7 10.3 1. 3 11.7 7 33.5 . 28 83 38 1 11.6 0 6.0 4.9 9.2 150 4 9.5 4 12.1 24.3 13.6 1. 3 4 10.2 .7 37 29 45 6.1 5.1 163 13.6 0 24.7 12.3 6.1 6 6 9.8 1. 2 5.7 4.5 3 178 42 30 10.3 .9 50 -16.2 33.2 9.4 8 7.9 2 193 14.5 1.2 4.3 2.0 46.3 7.1 13 .1 43 28 56 2.5 208 38.0 9.7 10.0 9.4 9 6.2 4.0 12 9 . 3 1.1 48 37 63 9.5 33.5 215 9.0 9.2 4.3 3.4 14 10 .4 5.1 6 1. 55 2 37 69 8.6 37.8 199 8.9 8.1 4.8 6.3 13 5.3 .5 113 44.8 140 7.6 54 1.3 75 8.6 9.1 3.8 10 5.6 4.8 38.4 . 0 12 2 42 8.5 49 1.7 81 10.1 9.8 33.1 5.5 4.2 2 . 13 3 1 9.9 44 80 1. 6 5.9 4.6 10 13 . 3 1 46 1. 2 7.0 5.3 9 117 . 0 41 4.0 1.2 8 . 0 36 3.4 1. 3 9 . 5 1. 6 11.4 1. 3 1. 1 soitsaflae 0000000000000000000000 Associates/affiliates Investment and ot her income/ expen prtn BTA1111122344468121617131920202122 EBITDA December 31 Ending Year 000 1111122223445667776 00000000 11100101111100 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 bn)(EUR 2003 STATEMENT INCOME Sales revenue 2004Operating 2005Depreciation Amortisation 2006EBITNet 2007 int erest income (expense) 2008 00000 111211358111161212121415 2009 2010 0 12 2011 2012 13 0 2013E 2014E 14 13 15 22 22 34 41 44 45 56 77 134 154 175 169 194 214 224 234 216 Enterprise Value (EUR bn) (EUR Value Enterprise 1 2 3 3 4 13 Tot al marketbn) cap (EUR 3 4 4 13 2 234 (6.8%) (6.3%) NAFG.DE NAFG.DE BYWGnx .D E (2.9%) UTDI.DE UTDI.DE (8.2%) TUIGn.DE TUIGn.DE (3.1%) FRAG.DE FRAG.DE (3.4%) FPEG_p.DE (9.5%) CLSGn.D E (3.4%) LXSG.DE LXSG.DE Other (87.2%) data, Deutsche Bank estimates Bank Deutsche data, y Other (69.2%) an p ource: Com Equity ResearchEquity SMGermany E Industry Aggregation NA German Small and Mid caps A g greg at io ns are b asedDat o aisDB n calendarised co vered st and o no cks. n-weig ht ed . oa te ses333335891314141927445364626975788177 assets CalenderisedRevenues 2013Total bn) (EUR Other - Current Capitalization Market - UTDI.DE INTERNET 4. UNITED Otbn) h e r (EUR Tot al 4 115 Net int erest cover (x) nm nm nm nm 29.2 18.2 14.2 4.6 3.5 2.8 2.7 5.1 6.0 6.4 7.6 4.8 2.3 4.8 4.5 4.1 4.8 6.3 Figure 94: German SME equity universe covered by Deutsche Bank Model updat ed: 05 April 2013 1. CELESIO - CELESIO CLSGn.DE1. - 2.AG TUI TUIGn.DE - BYWGnx.DE BAYWA 3. - NAFG.DE AURUBIS 4. Other 22 16 19 15 162 - LXSG.DE LANXESS 1. - FPEG_p.DE AG PETROLUB FUCHS 2. 3. FRAPORT AG - FRAG.DE 4 5 4

A.7 Index agglomerations S

Page 58 Deutsche Bank AG/London

9 April 2013 Made in Germany Special Report

90 80 70 60 50 40 30 20 10 100 0 Sales growt h( %) Op. EBITDA /s ales (%) Net debt/(cash) (EUR bn) (%) Net debt/equity ROE ( %) (%) Capital on Return (%) Capital on Return Operating Avg. Net Debt (Cash)/Equity Debt Net Avg. Margin Trends (%) Trends Margin Return Ratios (%) Ratios Return Price Gainers & Losers & Price Gainers AFRICA OIL - AOIC.ST (674.5%) - OIL AOIC.ST AFRICA 888 - (153.7%) 888.L (114.6%) - OPHR.L ENERGY OPHIR (-66.8%) -KPN KPN.AS (-69.0%) -OTMT OTMTq.L A QU A RIU S PL A TIN UM L IM ITED - A QP.L ( - 7 0.2 %) 93 95 97 99 01 03 05 07 09 11 13E 0 50 93 95 97 99 01 03 05 07 09 11 13E 93 95 97 99 01 03 05 07 09 11 13E 350 300 250 200 150 100 -200% 0% 200% 400% 600% 800% 5 0 5 0 -5 -5 30 25 20 15 10 30 25 20 15 10 -10 -15 -10 apitalisation

Source: Company data, Deutsche Bank estimates Bank Deutsche data, Company Source:

Deutsche Bank AG/London Page 59

9 April 2013 Made in Germany Special Report

Appendix B

Q1 2013 reporting calendar

Figure 96: Q1 2013 reporting calendar among German SMEs Market Cap DB IBES No. Expected Expected Period (in Eur bn) Price Target DB Cons.est. of ICB Company name Date Time (CET) of reporting 05 Apr 13 05 Apr 13 Currency Price Rec Q1 EPS est. Sector Gerresheimer 10 Apr 2013 07:30 Q1 2013 1.3 42.8 EUR 43.0 H Health Care R Stahl Ag 10 Apr 2013 Y 2012 0.2 30.1 EUR NA Industrial Goods & Services Bauer AG 11 Apr 2013 Y 2012 0.3 19.2 EUR 18.0 H Construction & Materials SinnerSchrader 11 Apr 2013 Q2 2013 0.0 1.7 EUR NA H Technology Wilex Ag 11 Apr 2013 Q1 2013 0.0 1.6 EUR NA Health Care FJH 12 Apr 2013 Y 2012 0.0 0.9 EUR 4.7 H Technology November Ag 12 Apr 2013 S1 2012 0.0 0.0 EUR NA Health Care Agennix Ag 12 Apr 2013 Y 2012 0.0 0.3 EUR NA Health Care Jk Wohnbau Ag 15 Apr 2013 Y 2012 0.1 3.0 EUR NA Personal & Household Goods United Labels 15 Apr 2013 Y 2012 0.0 1.0 EUR NA Retail Ultrasonic Ag 15 Apr 2013 Y 2012 0.1 9.9 EUR NA Personal & Household Goods Ahlers 15 Apr 2013 Q1 2013 0.2 11.5 EUR NA H Personal & Household Goods Haikui Seafood A 17 Apr 2013 Y 2012 0.1 8.0 EUR NA Food & Beverage Curanum AG 17 Apr 2013 Q1 2013 0.1 2.7 EUR NA Health Care Wirecard 17 Apr 2013 Y 2012 2.3 20.2 EUR 16.0 H 0.2 3 Industrial Goods & Services Stratec 18 Apr 2013 Bef-mkt Y 2012 0.4 34.0 EUR 32.0 H Health Care BB BIOTECH 18 Apr 2013 Q1 2013 1.2 99.6 CHF 106.5 B Health Care Invision Ag 18 Apr 2013 Q1 2013 0.0 15.1 EUR NA Technology Deufol Se 18 Apr 2013 23:59 Y 2012 0.0 1.0 EUR NA Industrial Goods & Services United Power Tec 18 Apr 2013 Y 2012 0.0 3.7 EUR NA Industrial Goods & Services Ludwig Beck 19 Apr 2013 Q1 2013 0.1 30.0 EUR NA Retail Syzygy 19 Apr 2013 Y 2012 0.1 4.4 EUR NA Technology Teles 22 Apr 2013 Q1 2013 0.0 0.4 EUR NA Technology Zooplus AG 22 Apr 2013 Q1 2013 0.3 40.7 EUR 50.0 B Personal & Household Goods Electrawinds Se 23 Apr 2013 Y 2012 0.4 6.3 EUR NA Financial Services Schaltbau Holding Ag 23 Apr 2013 Q1 2013 0.2 31.0 EUR NA H Industrial Goods & Services Mevis Medical So 23 Apr 2013 Y 2012 0.0 9.0 EUR NA Technology Hess Ag 23 Apr 2013 Y 2012 0.0 0.6 EUR NA Construction & Materials Sartorius 23 Apr 2013 Q1 2013 1.5 84.4 EUR 47.0 B Industrial Goods & Services Geratherm 24 Apr 2013 Y 2012 0.0 5.3 EUR NA Health Care Intica Systems 24 Apr 2013 Y 2012 0.0 3.1 EUR NA Technology Krones 24 Apr 2013 Q1 2013 1.7 54.3 EUR 38.0 H 0.9 4 Industrial Goods & Services Wincor Nixdorf 24 Apr 2013 Q2 2013 1.2 36.7 EUR 50.0 B Technology Intelligence 24 Apr 2013 Q1 2013 0.3 10.9 EUR NA Technology MTU 25 Apr 2013 Q1 2013 3.7 71.4 EUR 78.0 B Industrial Goods & Services Praktiker 25 Apr 2013 Q1 2013 0.1 1.1 EUR 2.6 B Retail GRENKE Group 25 Apr 2013 Q1 2013 0.8 56.5 EUR 47.0 H Industrial Goods & Services Vita 34 Ag 25 Apr 2013 Q1 2013 0.0 2.9 EUR NA Health Care Fielmann 25 Apr 2013 Q1 2013 3.1 73.3 EUR 60.0 S 0.7 5 Retail Kontron AG 25 Apr 2013 Q1 2013 0.2 4.2 EUR 3.7 H Industrial Goods & Services Rhoen Klinikum 25 Apr 2013 Q1 2013 2.2 16.1 EUR 16.6 H Health Care Vtion Wirelss Te 25 Apr 2013 Y 2012 0.1 4.3 EUR NA Technology Amadeus 25 Apr 2013 Q1 2013 0.2 41.1 EUR NA NR Industrial Goods & Services ADVA 25 Apr 2013 Q1 2013 0.2 3.7 EUR 4.5 H Technology PUMA SE 25 Apr 2013 Q1 2013 3.5 231.1 EUR 225.0 H Personal & Household Goods Software AG 25 Apr 2013 Q1 2013 2.4 27.8 EUR 38.0 B Technology comdirect 25 Apr 2013 Q1 2013 1.1 8.1 EUR 9.0 B Financial Services Vossloh 25 Apr 2013 Q1 2013 1.1 79.0 EUR 70.0 H Industrial Goods & Services Delticom AG 25 Apr 2013 Q1 2013 0.4 35.8 EUR 28.0 S Automobiles & Parts Qiagen 25 Apr 2013 Q1 2013 3.8 20.5 USD 21.5 B 0.2 4 Health Care

Source: Bloomberg Finance LP, Deutsche Bank

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Figure 97: Q1 2013 reporting calendar among German SMEs (contd’) Market Cap DB IBES No. Expected Expected Period (in Eur bn) Price Target DB Cons.est. of ICB Company name Date Time (CET) of reporting 05 Apr 13 05 Apr 13 Currency Price Rec Q1 EPS est. Sector AIXTRON 26 Apr 2013 Q1 2013 1.1 11.3 EUR 14.0 B -0.1 4 Technology AEG Power Solutions 26 Apr 2013 Q1 2013 0.0 0.6 EUR NA Industrial Goods & Services SGL Group SE 26 Apr 2013 Q1 2013 2.1 30.3 EUR 30.0 H Industrial Goods & Services Zhongde Waste Te 29 Apr 2013 Y 2012 0.0 1.7 EUR NA Industrial Goods & Services Höft & Wessel 29 Apr 2013 Y 2012 0.0 1.7 EUR NA Industrial Goods & Services PSI AG 29 Apr 2013 Q1 2013 0.2 15.5 EUR 18.0 B Technology Envitec Biogas 30 Apr 2013 Y 2012 0.1 7.4 EUR NA Industrial Goods & Services Takkt 30 Apr 2013 Q1 2013 0.8 12.8 EUR 12.0 H Retail Adc African Deve 30 Apr 2013 Y 2012 0.1 9.3 EUR NA Financial Services Powerland Ag 30 Apr 2013 Y 2012 0.1 6.7 EUR NA Personal & Household Goods Wacker Chemie AG 30 Apr 2013 Q1 2013 2.9 55.4 EUR 37.0 S Chemicals DAB bank 30 Apr 2013 Q1 2013 0.3 3.5 EUR 3.5 H Financial Services Fantastic Co Agf 30 Apr 2013 Y 2012 0.0 0.0 EUR NA Financial Services Nemetschek AG 30 Apr 2013 Q1 2013 0.4 44.9 EUR NA Technology YOC AG 30 Apr 2013 Y 2012 0.0 6.9 EUR NA H Media Surteco AG 30 Apr 2013 Y 2012 0.2 18.7 EUR NA Personal & Household Goods Artnet Ag - Reg 30 Apr 2013 Y 2012 0.0 2.7 EUR NA Retail Vectron Systems AG 30 Apr 2013 Y 2012 0.1 3.0 EUR NA Chemicals C.A.T. oil 30 Apr 2013 Y 2012 0.4 8.0 EUR 9.5 B Oil & Gas China Specialty 30 Apr 2013 Y 2012 0.0 1.9 EUR NA Construction & Materials RIB Software AG 30 Apr 2013 Q1 2013 0.2 4.3 EUR NA Technology Travel24.Com 02 May 2013 Y 2012 0.0 13.0 EUR NA Technology SFC Energy AG 02 May 2013 Q1 2013 0.0 5.3 EUR 12.0 B Oil & Gas Villeroy & Boch 02 May 2013 Q1 2013 0.2 8.3 EUR 7.0 H Construction & Materials RealTech AG 02 May 2013 Q1 2013 0.0 5.3 EUR NA Technology Fuchs Petrolub AG 02 May 2013 Q1 2013 4.4 59.3 EUR 46.0 H Chemicals Draegerwerk AG 02 May 2013 Q1 2013 1.5 98.4 EUR 115.0 B Health Care Elmos 03 May 2013 Aft-mkt Q1 2013 0.2 8.1 EUR 7.4 H Technology Syskoplan 03 May 2013 Q1 2013 0.1 11.8 EUR NA Technology A.S. Creation 03 May 2013 Q1 2013 0.1 42.6 EUR NA NR Personal & Household Goods Morphosys 03 May 2013 Q1 2013 0.7 30.5 EUR 43.0 B Health Care Dyckerhoff 03 May 2013 Q1 2013 1.8 43.6 EUR NA NR Construction & Materials Compugroup Medical AG 03 May 2013 Q1 2013 0.9 16.2 EUR 23.0 B Technology Eckert & Ziegler 03 May 2013 Q1 2013 0.2 28.2 EUR NA Chemicals ROFIN-SINAR 03 May 2013 Q2 2013 0.6 25.8 USD 15.0 H 0.3 5 Industrial Goods & Services Ruecker 06 May 2013 Q1 2013 0.1 15.8 EUR NA Automobiles & Parts Augusta Technolo 06 May 2013 Q1 2013 0.2 24.0 EUR NA Technology Hamborner AG 06 May 2013 Q1 2013 0.3 7.2 EUR NA Real Estate Hypoport Ag 06 May 2013 Q1 2013 0.0 7.6 EUR NA Financial Services Pfeiffer Vacuum 07 May 2013 07:30 Q1 2013 0.8 84.4 EUR 69.0 S 1.0 4 Industrial Goods & Services Washtec AG 07 May 2013 Q1 2013 0.1 10.3 EUR NA H Industrial Goods & Services Loewe AG 07 May 2013 Q1 2013 0.0 3.1 EUR NA H Personal & Household Goods PATRIZIA Immobilien 07 May 2013 Q1 2013 0.4 7.1 EUR NA NR Real Estate Balda AG 07 May 2013 Q3 2013 0.3 4.4 EUR NA Technology CropEnergies 07 May 2013 Y 2013 0.5 6.0 EUR NA NR Oil & Gas Norma Group AG 07 May 2013 Q1 2013 0.8 24.1 EUR 22.0 H Automobiles & Parts Hawesko 07 May 2013 Q1 2013 0.4 42.7 EUR 40.0 H Retail Basler 07 May 2013 Q1 2013 0.1 15.0 EUR NA S Industrial Goods & Services Alstria 07 May 2013 Q1 2013 0.7 8.9 EUR 10.7 B Real Estate Gildemeister AG 07 May 2013 Q1 2013 0.9 15.3 EUR NA H Industrial Goods & Services Stada Arzneimittel AG 07 May 2013 Q1 2013 1.7 29.9 EUR 33.0 B Health Care Axel Springer 07 May 2013 Q1 2013 3.3 33.7 EUR 42.0 H Media Secunet 08 May 2013 Q1 2013 0.1 12.1 EUR NA Technology Singulus Technologies 08 May 2013 Q1 2013 0.1 1.2 EUR 2.5 H Industrial Goods & Services Prime Office 08 May 2013 Q1 2013 0.2 3.4 EUR 3.5 H Real Estate

Source: Bloomberg Finance LP, Deutsche Bank

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9 April 2013 Made in Germany Special Report

Figure 98: Q1 2013 reporting calendar among German SMEs Market Cap DB IBES No. Expected Expected Period (in Eur bn) Price Target DB Cons.est. of ICB Company name Date Time (CET) of reporting 05 Apr 13 05 Apr 13 Currency Price Rec Q1 EPS est. Sector TAG Immobilien AG 08 May 2013 Q1 2013 1.1 8.7 EUR NA Real Estate Dialog Semiconductor 08 May 2013 Q1 2013 0.7 11.0 EUR 15.0 H 0.2 6 Technology Polis Immobilien 08 May 2013 Q1 2013 0.1 10.5 EUR NA Real Estate KUKA AG 08 May 2013 Q1 2013 1.1 31.0 EUR 30.0 H 0.5 4 Industrial Goods & Services Kloeckner & Co. 08 May 2013 Q1 2013 1.0 10.4 EUR 9.5 H Basic Resources Deutz AG 08 May 2013 Q1 2013 0.5 3.9 EUR NA H 0.1 3 Industrial Goods & Services Biotest 08 May 2013 Q1 2013 0.7 57.6 EUR NA S Health Care ElringKlinger AG 08 May 2013 Q1 2013 1.4 22.5 EUR 21.0 H Automobiles & Parts IVG Immobilien AG 08 May 2013 Q1 2013 0.1 0.6 EUR NA NR Real Estate Analytik Jena 08 May 2013 Q2 2013 0.1 11.3 EUR NA Health Care Masterflex 08 May 2013 Q1 2013 0.0 4.9 EUR NA Chemicals Jenoptik 08 May 2013 Q1 2013 0.4 7.9 EUR 7.5 H Industrial Goods & Services TePla 08 May 2013 Q1 2013 0.0 2.0 EUR NA Technology Alphaform 08 May 2013 Q1 2013 0.0 2.9 EUR NA Industrial Goods & Services GEA 08 May 2013 Q1 2013 4.9 25.5 EUR 30.0 B Industrial Goods & Services Rheinmetall 08 May 2013 Q1 2013 1.4 35.3 EUR 31.0 S 1.8 3 Automobiles & Parts Tomorrow Focus 08 May 2013 Q1 2013 0.2 4.1 EUR 4.0 H Media Ovb Holding Ag 08 May 2013 Q1 2013 0.3 18.9 EUR NA Financial Services Euromicron 08 May 2013 Q1 2013 0.1 15.6 EUR 17.0 H Industrial Goods & Services Fair Value Reit 08 May 2013 Q1 2013 0.0 4.4 EUR NA Real Estate Intershop Commun 08 May 2013 Q1 2013 0.1 1.9 EUR NA Technology Fraport AG 08 May 2013 Q1 2013 4.0 43.1 EUR 52.0 B Industrial Goods & Services SHW 08 May 2013 Q1 2013 0.2 33.5 EUR 34.0 B Automobiles & Parts Manz AG 08 May 2013 Q1 2013 0.1 22.9 EUR NA NR Oil & Gas Phoenix Solar AG 08 May 2013 Q1 2013 0.0 1.3 EUR NA NR Oil & Gas Rational AG 08 May 2013 Q1 2013 2.6 229.3 EUR NA H Industrial Goods & Services Epigenomics Ag 08 May 2013 Q1 2013 0.0 1.8 EUR NA Health Care Mybet Holding Se 08 May 2013 Q1 2013 0.0 1.5 EUR NA Travel & Leisure Pulsion Medical Systems 08 May 2013 Q1 2013 0.1 15.7 EUR NA Health Care GFT Technologies 08 May 2013 Q1 2013 0.1 3.4 EUR NA NR Technology Jungheinrich 08 May 2013 Q1 2013 1.1 31.7 EUR 32.0 B Industrial Goods & Services Telegate AG 08 May 2013 Q1 2013 0.2 8.1 EUR NA NR Industrial Goods & Services Suess Microtec AG 08 May 2013 Q1 2013 0.2 9.1 EUR 9.0 H Industrial Goods & Services Freenet AG 08 May 2013 Q1 2013 2.3 18.4 EUR 17.0 B Telecommunications Grammer 08 May 2013 Q1 2013 0.2 20.4 EUR NA NR Automobiles & Parts Tom Tailor 08 May 2013 Q1 2013 0.4 17.3 EUR 19.0 B Retail Duerr 08 May 2013 Q1 2013 1.4 79.1 EUR 95.0 B Industrial Goods & Services Logwin 09 May 2013 Q1 2013 0.2 1.0 EUR NA NR Industrial Goods & Services Symrise 09 May 2013 Q1 2013 3.6 30.6 EUR 29.0 H Chemicals Douglas 09 May 2013 Q2 2013 1.5 38.0 EUR 38.0 H Retail Kromi Logistik A 09 May 2013 Q3 2013 0.0 9.0 EUR NA Industrial Goods & Services Solar-Fabrik AG 10 May 2013 Q1 2013 0.0 2.1 EUR NA Oil & Gas SMARTRAC 10 May 2013 Q1 2013 0.2 10.6 EUR NA NR Technology Petrotec Ag 10 May 2013 Q1 2013 0.0 1.0 EUR NA Oil & Gas Drillisch Group 10 May 2013 Q1 2013 0.7 14.0 EUR NA Telecommunications 4Sc Ag 10 May 2013 Q1 2013 0.1 1.7 EUR NA Health Care Nexus 10 May 2013 Q1 2013 0.1 8.8 EUR NA Technology Articon-Integralis 10 May 2013 Q1 2013 0.1 8.1 EUR NA Technology INIT Innovation In Traffic 10 May 2013 Q1 2013 0.2 23.1 EUR NA Technology AD pepper Media 10 May 2013 Q1 2013 0.0 0.9 EUR NA Media WESTAG&GET. AG 10 May 2013 Q1 2013 0.1 17.6 EUR NA Construction & Materials Verbio AG 12 May 2013 Q3 2013 0.1 1.2 EUR NA Oil & Gas ATOSS 13 May 2013 Q1 2013 0.1 30.9 EUR NA Technology Lotto24 13 May 2013 Q1 2013 0.1 3.9 EUR NA Travel & Leisure Estavis Ag 13 May 2013 Q3 2013 0.0 2.0 EUR NA Real Estate

Source: Bloomberg Finance LP, Deutsche Bank

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Figure 99: Q1 2013 reporting calendar among German SMEs (contd’) Market Cap DB IBES No. Expected Expected Period (in Eur bn) Price Target DB Cons.est. of ICB Company name Date Time (CET) of reporting 05 Apr 13 05 Apr 13 Currency Price Rec Q1 EPS est. Sector Baywa Ag 13 May 2013 Q1 2013 1.2 40.7 EUR NA Food & Beverage CEWE COLOR 13 May 2013 Q1 2013 0.2 32.9 EUR 38.0 B Retail QSC AG 13 May 2013 Q1 2013 0.3 2.4 EUR 2.8 B Technology Plambeck 13 May 2013 Q1 2013 0.1 2.3 EUR 25.5 B Utilities Palm Hills Developments 14 May 2013 Q1 2013 0.0 1.8 EUR NA Oil & Gas Celesio 14 May 2013 Q1 2013 2.5 14.6 EUR 13.5 H Retail HHLA 14 May 2013 Q1 2013 1.2 17.2 EUR 17.0 H 0.2 5 Industrial Goods & Services Bilfinger SE 14 May 2013 Q1 2013 3.6 78.1 EUR 82.0 H Industrial Goods & Services XING AG 14 May 2013 Q1 2013 0.2 39.5 EUR 50.0 H Technology Bechtle 14 May 2013 Q1 2013 0.8 35.9 EUR 33.0 H Technology LEONI 14 May 2013 Q1 2013 1.0 29.6 EUR 27.0 H Industrial Goods & Services Evotec 14 May 2013 Q1 2013 0.3 2.2 EUR 2.6 H Health Care Adlink Internet 14 May 2013 Q1 2013 0.1 1.8 EUR NA Media Aurubis 14 May 2013 Q2 2013 2.1 46.4 EUR 58.0 H Basic Resources CENIT 14 May 2013 Q1 2013 0.1 9.5 EUR NA Technology Technotrans 14 May 2013 Q1 2013 0.1 8.8 EUR NA Industrial Goods & Services Quanmax AG 14 May 2013 Q1 2013 0.1 2.2 EUR NA Retail VBH Holding AG 14 May 2013 Q1 2013 0.1 2.6 EUR NA H Personal & Household Goods Asian Bamboo-Br 14 May 2013 Q1 2013 0.1 3.8 EUR NA Basic Resources Centrotec Hochleistungssto 14 May 2013 Q1 2013 0.3 15.1 EUR NA Oil & Gas Tipp24 14 May 2013 Q1 2013 0.3 41.3 EUR 50.0 B Travel & Leisure Deutsche Wohnen 14 May 2013 Q1 2013 2.2 13.7 EUR 15.5 H Real Estate ALL FOR ONE MIDMARKE 14 May 2013 Q2 2013 0.1 14.4 EUR NA Technology Wacker Neuson SE 14 May 2013 Q1 2013 0.8 11.2 EUR 10.0 H Industrial Goods & Services H&R AG 14 May 2013 Q1 2013 0.3 9.5 EUR NA Chemicals LPKF 15 May 2013 08:00 Q1 2013 0.2 19.3 EUR NA S Industrial Goods & Services Nordex 15 May 2013 Q1 2013 0.4 5.1 EUR 3.0 H Oil & Gas DIC Asset AG 15 May 2013 Q1 2013 0.3 7.3 EUR NA NR Real Estate Paragon Ag 15 May 2013 Q1 2013 0.0 8.2 EUR NA Industrial Goods & Services 3U O.N. 15 May 2013 Q1 2013 0.0 0.5 EUR NA Telecommunications Mifa Mitteldeuts 15 May 2013 Q1 2013 0.1 6.6 EUR NA Personal & Household Goods Deutsche EuroShop 15 May 2013 Q1 2013 1.7 30.7 EUR 33.0 H Real Estate Adler Modemarkte 15 May 2013 Q1 2013 0.1 6.8 EUR NA Retail Softing 15 May 2013 Q1 2013 0.0 7.4 EUR NA Technology Joyou Ag 15 May 2013 Q1 2013 0.3 11.0 EUR NA Construction & Materials GfK 15 May 2013 Q1 2013 1.5 40.3 EUR 39.5 H Media Advanced Vision 15 May 2013 Q1 2013 0.0 5.8 EUR NA Industrial Goods & Services Carl Zeiss Meditec 15 May 2013 Q2 2013 1.9 23.2 EUR 22.5 H Health Care TUI AG 15 May 2013 Q2 2013 2.0 7.8 EUR 10.3 B Travel & Leisure AAP Implantate 15 May 2013 Q1 2013 0.0 1.4 EUR NA Health Care Skw Stahl-Metall 15 May 2013 Q1 2013 0.1 12.4 EUR NA Basic Resources Mobotix Ag 15 May 2013 Q2 2013 0.2 16.0 EUR NA Industrial Goods & Services Smt Scharf Ag 15 May 2013 Q1 2013 0.1 24.8 EUR NA Industrial Goods & Services SMA 15 May 2013 Q1 2013 0.6 18.2 EUR 25.0 B Oil & Gas Mologen Ag 15 May 2013 Q1 2013 0.2 13.4 EUR NA Health Care Mediclin 15 May 2013 Q1 2013 0.2 4.0 EUR NA NR Health Care Muehlbauer 15 May 2013 Q1 2013 0.3 21.2 EUR NA Technology Ecotel Communica 15 May 2013 Q1 2013 0.0 5.5 EUR NA Telecommunications HWAG 15 May 2013 Q1 2013 0.2 3.8 EUR NA Financial Services MVV Energie AG 15 May 2013 Q2 2013 1.5 22.8 EUR 19.0 H Utilities Cancom Ag 15 May 2013 Q1 2013 0.2 14.8 EUR NA Technology Sky Deutschland 15 May 2013 Q1 2013 3.4 3.9 EUR 4.5 H Media Bertrandt AG 15 May 2013 Q2 2013 0.9 85.5 EUR 75.0 H Industrial Goods & Services Gigaset AG 15 May 2013 Q1 2013 0.0 0.9 EUR 1.2 H Technology OHB Teledata 15 May 2013 Q1 2013 0.3 16.1 EUR NA Technology

Source: Bloomberg Finance LP, Deutsche Bank

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9 April 2013 Made in Germany Special Report

Figure 100: Q1 2013 reporting calendar among German SMEs Market Cap DB IBES No. Expected Expected Period (in Eur bn) Price Target DB Cons.est. of ICB Company name Date Time (CET) of reporting 05 Apr 13 05 Apr 13 Currency Price Rec Q1 EPS est. Sector Sygnis Pharma Ag 15 May 2013 Q1 2013 0.0 2.6 EUR NA Health Care Koenig & Bauer AG 15 May 2013 Q1 2013 0.3 17.1 EUR 12.0 H Industrial Goods & Services MLP 15 May 2013 Q1 2013 0.6 5.3 EUR NA NR Financial Services Salzgitter 15 May 2013 Q1 2013 1.8 30.6 EUR 36.0 H Basic Resources Data Modul AG 15 May 2013 Q1 2013 0.1 15.9 EUR NA Industrial Goods & Services Stroeer 15 May 2013 Q1 2013 0.3 8.1 EUR 12.5 B Media Air Berlin 15 May 2013 Q1 2013 0.2 2.1 EUR 3.5 B Travel & Leisure Conergy Ag 15 May 2013 Q1 2013 0.1 0.4 EUR NA Oil & Gas GAGFAH 15 May 2013 Q1 2013 1.9 9.0 EUR 8.0 H Real Estate Medigene 16 May 2013 Q1 2013 0.0 0.9 EUR NA Health Care VTG AG 16 May 2013 Q1 2013 0.3 13.4 EUR 14.0 B Industrial Goods & Services SAF Holland SA 16 May 2013 Q1 2013 0.3 5.8 EUR 5.0 H Automobiles & Parts UMS United Medical Syste 17 May 2013 Q1 2013 0.0 9.9 EUR NA Health Care Youniq Ag 17 May 2013 Q1 2013 0.1 5.3 EUR NA Real Estate Sag Solarstrom 20 May 2013 Q1 2013 0.0 2.9 EUR NA Utilities United Internet 21 May 2013 Q1 2013 3.6 18.8 EUR 22.0 B 0.3 3 Technology Lloyd Fonds Ag 21 May 2013 Q1 2013 0.0 0.4 EUR NA Financial Services GSW 21 May 2013 Q1 2013 1.5 29.7 EUR 36.0 B Real Estate Usu Software Ag 21 May 2013 Q1 2013 0.1 7.6 EUR NA Technology Essanelle Hair Group 22 May 2013 Q1 2013 0.0 10.8 EUR NA Retail Aareal Bank 22 May 2013 Q1 2013 1.0 16.4 EUR 20.5 B Financial Services Hans Einhell AG 22 May 2013 Q1 2013 0.1 32.4 EUR NA Personal & Household Goods Ifm Immobilien A 23 May 2013 Q1 2013 0.1 11.8 EUR NA Real Estate Centrosolar Grou 23 May 2013 Q1 2013 0.0 0.6 EUR NA Oil & Gas IBS 23 May 2013 Q2 2013 0.1 9.9 EUR NA Technology Electronic Line 23 May 2013 Q1 2013 0.0 0.5 EUR NA Technology Highlight Communications 23 May 2013 Q1 2013 0.2 4.3 EUR NA Media Dr. Hoenle 24 May 2013 Q2 2013 0.1 11.8 EUR NA Industrial Goods & Services Constantin Medien AG 24 May 2013 Q1 2013 0.1 1.8 EUR 1.4 H Media Sixt AG 27 May 2013 Q1 2013 0.7 15.6 EUR 16.0 H Retail INDUS Holding 28 May 2013 Q1 2013 0.5 24.3 EUR NA Industrial Goods & Services Hornbach Baumarkt AG 28 May 2013 Y 2013 0.8 25.7 EUR NA NR Retail Hornbach Holding 28 May 2013 Y 2013 0.8 49.4 EUR 64.0 B Retail Df Deutsche Forf 29 May 2013 Q1 2013 0.0 3.7 EUR NA Financial Services IVU Traffic Technologies 29 May 2013 Q1 2013 0.0 1.6 EUR NA Technology Youbisheng Green 29 May 2013 Q1 2013 0.1 4.9 EUR NA Basic Resources Orad Hi-Tech 29 May 2013 Q1 2013 0.0 1.7 EUR 5.0 B Technology Silicon Sensor International 30 May 2013 Q1 2013 0.1 8.1 EUR NA Industrial Goods & Services KWS AG 30 May 2013 Q3 2013 1.9 280.6 EUR NA Food & Beverage Francotyp-Postal 30 May 2013 Q1 2013 0.0 2.2 EUR NA Industrial Goods & Services FORTEC Elektronik AG 30 May 2013 Q3 2013 0.0 10.2 EUR NA Technology Mbb Industries 31 May 2013 Q1 2013 0.1 17.6 EUR NA Financial Services Bmp Media Invest 31 May 2013 Q1 2013 0.0 0.7 EUR NA Financial Services Isra Vision Ag 31 May 2013 Q2 2013 0.1 28.4 EUR NA Technology CTS Eventim AG 31 May 2013 Q1 2013 1.3 26.8 EUR 32.0 B Industrial Goods & Services Deag Deut Entert 31 May 2013 Q1 2013 0.0 3.5 EUR NA Travel & Leisure Fabasoft 04 Jun 2013 Y 2013 0.0 2.7 EUR NA Technology Gesco Ag 11 Jun 2013 Y 2013 0.2 73.9 EUR NA Industrial Goods & Services P&I 14 Jun 2013 Y 2013 0.3 33.8 EUR NA NR Technology Heidelberger Druck 14 Jun 2013 Y 2013 0.4 1.5 EUR 2.5 B Industrial Goods & Services Deutsche Beteiligungs 14 Jun 2013 Q2 2013 0.3 18.8 EUR NA NR Financial Services Gerry Weber 14 Jun 2013 Q2 2013 1.5 32.2 EUR 40.0 B Personal & Household Goods Jetter AG 28 Jun 2013 Y 2013 0.0 4.7 EUR NA Industrial Goods & Services

Source: Bloomberg Finance LP, Deutsche Bank

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9 April 2013 Made in Germany Special Report

Yield Sales EBITDA OC EPS 90 22.47 28.87 6.09 6.48 5.04 4.00 2.75 0.38 3.43 1.46 11.34 2.89 3.14 3.35 22.14 20.37 19.11 1.35 2.11 2.13 11.50 7.12 cap. of as Target- Downs. since Sharecl. 05/04/2013 price potential last 2012E 2013E 2014E 2012E 2013E 2014E 2013E 2013E illeroy & Bochilleroy 92 8.25 7.00 -15.15 18.06 0.56 0.56 0.65 14.82 14.73 12.76 0.35 4.24 0.42 5.40 1.57 V (Euro m) EUREUR in (%) 3M (%) EUR EUR EUR EUR (%) 13E 13E 13E IBG_p.DE H Banks ARLG.DEBasic Resources NAFG.DEO2C.DESZGG.DE BChemicals FPEG_p.DE Ag Bank Aareal FPEG.DE HSGCG.DESY1G.DE B Aurubis HWCHG.DE Oil C.A.T. SalzgitterConstruction HB5AG.DEAg-Pfd NR Petrolub Fuchs HConsumer Ag Petrolub Fuchs HCWCG.DE S Se Group Sgl 744GWIG.DE SymriseBOSSn.DE WackerLOEG.DE H 16.16PUMG.DE 2,054TTIGn.DE 20.50 Ag Bauer 1,845 B 1,337 123 26.86 B 64.05 904 B Color Cewe 46.31 -6.87 46.00 Weber Gerry H 58.00 1.42 Boss-Pfd 30.33 Hugo H 8.02 -28.18 59.47 879 1.69 36.00 Loewe B 25.26 Se Puma 9.50 2.17 -15.12 Tailor Tom 18.71 3,092 30.30 4.60 18.51 -24.57 11.39 834 30.00 -1.89 4.92 10.45 30.63 1.04 4.94 0.37 9.58 194 29.00 -0.99 55.30 2.98 0.78 10.06 37.00 -6.69 155 2,026 12.88 0.97 7.44 -5.31 -16.08 882 18.93 0.70 2.89 -33.09 0.25 14.07 9.41 21.96 20.00 0.65 3.14 32.80 29.16 86.72 1.55 1.30 32.42 1.25 3.35 38.00 1.55 96.00 10.28 1.74 1.80 9.38 609 5.65 10.19 40.00 15 300 NA 1.92 43.57 1.90 -13.85 1.40 20.56 0.25 15.87 10.70 8.25 23.40 1.47 231.90 NA 19.79 5.13 7.13 46.89 NA -12.08 225.00 0.00 18.92 17.27 3.02 3.10 1.93 0.82 2.87 4.51 1.72 0.16 30.73 0.24 19.00 2.56 NA 17.56 24.22 17.74 -2.98 2.99 4.95 0.00 1.99 0.25 6.81 1.35 5.24 1.04 3.33 29.04 10.02 12.87 5.58 2.33 15.98 1.37 12.99 0.83 0.97 0.73 6.89 4.33 11.42 0.83 14.62 19.23 18.88 2.27 9.83 16.68 1.20 1.62 2.13 1.41 2.39 10.96 1.60 17.53 16.32 13.24 11.50 17.85 7.40 2.35 10.57 0.48 1.94 1.83 -0.10 15.55 7.12 0.45 13.90 11.78 9.84 15.86 0.14 14.37 3.46 0.86 0.90 1.50 3.21 0.20 0.77 2.38 13.90 10.81 0.64 3.99 2.78 4.57 1.90 -31.32 4.61 2.44 1.56 0.44 5.28 0.88 8.90 10.69 22.73 0.82 9.36 3.30 0.90 0.30 0.91 6.34 3.71 15.64 1.34 7.86 1.74 0.00 0.64 1.95 0.00 5.38 0.14 1.21 1.69 0.41 Automobile BDTG.DEZILGn.DELEOGn.DESW1.DEVOWG.DE H H H Ag Bertrandt Ag Elringklinger B Ag Leoni B Shw Ag Volkswagen 386 802 4,943 1,034 86.04 22.60 75.00 21.00 145.50 29.31 165.00 -12.83 27.00 -7.08 70 13.89 13.40 -11.53 5.14 -7.88 1.36 -8.94 34.01 23. 5.60 1.53 0.26 34.00 5.80 1.70 4.76 3.00 -0.03 16.74 16.67 3.69 11.45 15.36 2.81 14.73 6.16 3.11 14.83 13.33 4.12 2.25 0.54 9.76 12.09 2.62 2.38 7.93 1.12 10.94 1.54 0.90 8.51 7.45 8.26 3.07 3.20 1.84 1.35 0.34 4.42 3.97 0.55 1.07 4.84 3.75 Ticker Rec. Company FF-Market Price Upside/ Perf.V P/ERatio Div. Div. EV/ EV/ EV/ Financial services AOXG.DECDBG.DEDRNG.DEDEQGn.DEDWNG.DEGFJG.DEGKLG.DE BGIBG.DE BLEGn.DE Reit-Ag Office H Alstria PMOG.DE H Comdirect H Bank Dab Euroshop Deutsche H Wohnen Deutsche H Gagfah B Group Grenke B H Immobilien Gsw 619 Leg Office Prime 1,412 8.90 2,017 229 10.70 30.79 67 33.00 13.71 20.22 8.01 15.50 1,438 -5.93 407 7.18 3.55 0.55 9.00 680 13.10 -1.09 0.65 29.71 3.50 56.44 183 -0.11 1.68 12.36 0.69 36.00 47.00 0.52 2.02 8.99 -3.82 1,163 -1.41 0.67 16.16 2.11 21.17 -16.73 0.52 3.40 8.00 -3.49 0.70 0.49 -3.86 9.96 41.26 0.22 18.28 13.71 3.50 -10.99 0.56 1.27 26.29 3.10 48.50 0.21 0.80 12.98 1.59 15.22 3.23 0.25 2.94 15.42 17.55 20.41 0.38 0.58 1.72 3.45 -3.63 14.63 16.20 0.33 16.23 19.63 0.31 23.38 1.25 na 18.19 6.57 0.33 14.00 0.34 0.01 16.53 2.55 14.27 18.65 17.49 23.83 16.53 0.06 4.06 2.64 0.49 13.81 13.95 2.45 2.88 0.92 17.25 10.37 16.37 11.02 0.21 27.09 15.93 6.16 1.04 20.57 0.90 16.16 1.01 354.46 27.07 NA 6.05 1.07 3.48 0.00 15.61 1.59 58.07 NA 13.38 NA 6.09 0.07 21.58 14.34 0.00 13.30 NA NA 7.76 1.72 0.98 1.98 0.43 12.65 NA 20.35 4.16 45.73 0.93 8.75 0.78 18.23 0.99 Figure 101: List of companies mentioned in this report

Appendix C Companies mentioned list estimates Bank Deutsche data, Company Source:

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9 April 2013 Made in Germany Special Report

Yield Sales EBITDA OC EPS 75 6.28 6.59 13.41 12.28 11.70 3.00 3.89 0.37 5.60 2.24 06 1.20 1.35 19.24 17.09 15.13 0.00 0.00 3.68 12.74 1.70 54 0.70 0.99 1.05 24.18 17.16 16.20 0.2069 1.17 0.01 0.25 0.02 4.63 NA 0.67 84.85 56.41 0.00 0.00 -0.08 -0.57 -0.14 92 2.47 2.86 3.47 11.95 10.30 8.49 0.53 1.78 1.43 7.14 1.30 cap. of as Target- Downs. since Sharecl. 05/04/2013 price potential last 2012E 2013E 2014E 2012E 2013E 2014E 2013E 2013E ossloh 327 79.03 70.00 -11.43 4.50 4.35 4.34 5.32 18.18 18.21 14.85 1.95 2.47 0.96 8.94 1.38 V (Euro m) EUREUR in (%) 3M (%) EUR EUR EUR EUR (%) 13E 13E 13E OSG.DE H DEZG.DEDUEG.DEG1AG.DEGFKG.DEGILG.DEHDDG.DEJENG.DEJUNG_p.DE HKCOGn.DE BSKBG.DE B Ag Deutz KRNG.DE Duerr HKU2G.DE Gea HMANG.DE B GfkMANGP.F H B Ag Gildemeister MTXGn.DE Druck Heidelberger HNDXG.DE Ag Jenoptik JungheinrichNOEJ.DE H Co. & Kloeckner PV.DE HRAAG.DE H Ord & Bauer Koenig HRHMG.DE KronesRSTI.DE H Ag Kuka B Ord Man SFQN.DESLTG.MU Pref Man H 354 Aero Engines Gmbh Mtu F3CG.DE H 412SNGG.DE Nordex 850 909S92G.DE HAg Group Norma S 4,686 SSWVG.DE 3.86 Ag 1.55 Rational 554 901 15.00 Technology 193 340 Vacuum Pfeiffer H 685 Ord Rheinmetall 78.58 H 25.61 H 2.50 3,612 95.00Inc Technologies Rofin-Sinar Sa Holland Saf B 30.00 31.80 10.44 17.04 40.27 H Schaltbau 7.85 60.98 20.90 32.00 12.00 B Ag 39.50 Energy Sfc 9.50 71.67 17.16 27.80 H Technologies Singulus 15.63 7.50 635 3,134 897 812 -0.99 78.00 -29.58 -0.76 Sma 6.44 0.63 -1.91 Ag Solarworld -8.96 -0.15 381 624 25. -4.51 574 2.28 7.65 2.62 54.23 -10.69 2.29 0.18 84.12 1.08 8.83 84.45 7.86 31.10 2.35 7.51 0.20 0.17 1,533 38.00 1.31 3.12 219 -0.82 2.63 82.00 69.00 30.00 2.58 3.15 24.17 0.31 0.68 19.91 -1.57 NA 1.39 3.40 0.09 784 2.81 12.20 -29.93 4.01 22.00 0.47 -18.29 0.71 15.00 -2.52 31.00 1.54 3.59 0.38 11.23 3.03 35.19 -3.54 -10.30 283 16.44 4.83 5.03 0.72 68 -8.26 10.28 229.25 -24.66 10.78 31.00 19.00 1.83 -8.98 2.91 -12.69 5.53 11.42 10.21 15.31 10.88 5.13 3.00 11.58 1.64 2.56 8.54 171 11.63 14.60 24 3.11 10.46 -11.91 5.11 111.96 12.42 5.84 17.89 1.37 2.07 5.75 0.00 1.15 10.81 1.94 3.92 -40.36 14.32 2.68 9.35 9.92 -5.96 5.60 11.03 1.55 85 2.10 7.72 1.97 5.00 4.28 55.86 27.26 2.50 0.65 4.99 14.84 8.25 5.46 18.62 13.27 0.00 NA 9.73 -0.12 2.27 2.56 16.45 3.41 0.00 NA 8.86 10.83 18.97 -14.31 2.33 32.81 0.00 116.64 12.00 182 0.30 0.79 0.38 0.05 0.48 12.95 5.75 0.92 0.18 2.54 17.41 -25. 0.93 4.58 12.48 14.53 6.44 16.52 119.82 0.00 1.60 7.72 15.05 0.90 6.05 14.62 NA 5.52 0.00 3.50 1.95 0.40 2.53 0.20 18.23 13.83 -8.69 2.90 2.27 12.27 0.54 15.08 0.68 7.06 12.86 1.04 8.49 7.44 2.95 0.41 -42.27 14.83 0.69 10.90 -0.07 0.78 25.00 2.24 0.51 0.82 3.30 8.44 9.41 0.62 5.70 0.83 6.00 1.79 1.25 10.64 0.11 7.30 101.02 15.10 4.70 10.46 3.46 5.64 37.17 0.64 0.69 1.44 0.27 1.15 1.38 3.91 9.03 0.95 14.46 -19.56 -4.40 1.99 1.16 0.99 7.13 0.58 26.99 7.69 1.55 -74.06 2.16 0.00 0.53 2.15 0.73 3.03 2.85 -46.79 1.60 7.98 -0.60 8.45 24.36 3.24 9.05 1.49 -2.13 6.31 51.48 7.42 0.00 0.35 1.89 0.00 -1.27 4.04 3.25 4.55 7.74 21.91 4.53 2.36 1.02 7.01 -0.99 20.06 0.48 0.00 8.42 7.53 0.28 1.90 0.00 7.93 0.36 -0.43 6.02 6.00 -30.45 1.40 3.28 4.72 7.45 1.54 0.00 4.94 -0.73 0.42 52.49 0.57 0.87 16.34 0.05 10.33 4.79 -0.94 18.27 0.73 0.00 1.10 1.01 0.26 7.42 0.17 0.00 2.36 1.43 4.67 0.74 0.40 NM 0.84 0.59 5.70 1.88 Food & Beverages Food SZUG.DEIndustrails AS1Gn.DEBYWGnx.DEGBFG.DE H Suedzucker H Baywa H Ag Solar Aleo Se Bilfinger 2,242 32.16 12 31.00 2,755 475 -3.59 NA 77.13 36.22 4.04 82.00 39.00 1.85 2.72 6.31 7.69 2.52 6.84 7.36 17.41 5. 1.68 -81.07 2.67 11.80 0.20 2.97 NA 12.77 21.54 1.10 NA 13.54 3.42 1.20 12.20 1.10 7.28 1.78 3.04 0.17 7.55 1.21 0.00 NM NM NM Ticker Rec. Company FF-Market Price Upside/ Perf.V P/ERatio Div. Div. EV/ EV/ EV/ RHKG.DESATG_p.DESTAGn.DESBSG.DE H H B Ord Klinikum Rhoen (Pref) Sartorius H Ag Arzneimittel Stada Stratec 1,524 1,689 686 16.09 29.48 16.60 33.00 77.55 3.20 77.00 11.94 267 9.59 17. -0.71 0.67 33.80 6.82 0.94 32.00 3.71 1.23 4.18 -5.33 24.02 4.65 -6.34 17.17 20.93 1.27 1.63 13.08 18.55 2.00 0.36 16.67 26.70 1.09 2.25 0.99 20.68 1.40 8.54 1.88 16.88 1.21 0.70 9.61 2.25 2.07 2.54 13.02 4.88 WACGn.DEWING.DEMedia SPRGn.DEEV4G.DEEVDG.DE HPSMG_p.DESKYDn.DE B Se Neuson Wacker SAXG.DE Nixdorf Wincor HHealthcare & Pharma BION.S H Springer Axel AFXG.DE B BDRWG.DE Ag Medien Constantin HDRWG_p.DE Prosiebensat.1 Ag Eventim Cts EVTG.DE B Deutschland Sky GXIG.DE 248MORG.DE StroeerQGEN.OQ B H 1,182 B B 11.29 Ag Biotech Bb Ag Meditec Zeiss Carl 10.00KgaaCo & Ag Draegerwerk Pref Draegerwerk 84 H 1,474 36.69 H -11.43 B 50.00 Evotec 2,071 B 561 Gerresheimer 5.69 1,891 1.79 Morphosys 33.71 36.28 N.V. Qiagen 0.84 42.00 26.23 1.40 -3.65 250 26.58 0.80 29.00 3.89 2.12 687 24.59 1.13 32.00 -21.83 2.87 160 4.50 86.25 10.56 3.05 9.29 602 13.45 20.41 969 3.62 115.00 20.75 23.06 3.00 0.14 15.56 -0.70 1.99 22.50 2.55 14.20 0.15 -15.87 17.34 33.33 8.10 1.17 98.05 99.60 1.93 -0.23 2.68 0.17 39.92 115.00 1,218 12.50 106.50 1.36 -2.41 -0.10 12.76 2.16 9.98 7.15 1.56 11.24 13.08 733 3,627 248 17.29 0.06 54.32 0.36 3.52 8.06 6.93 10.13 13.18 42.88 24.23 12.07 0.88 22.69 8.82 -16.90 13.23 11.71 10.62 1.44 43.00 7.15 3.17 0.52 30.47 20.46 1.07 13.57 2.85 2.27 0.92 12.07 19.60 -40.22 8.06 12.57 0.64 10.82 43.00 21.50 1.19 2.90 3.92 0.29 2.60 12.14 8.82 1.70 0.89 0.00 6.74 0.50 16.99 63.39 2.91 10.70 11.30 41.12 26.08 1.49 5.08 14.54 0.68 0.00 0.86 13.72 2.56 15.52 6.63 5.04 3.29 0.00 34.96 -16.34 8.93 21.55 9.77 2.79 1.48 0.61 5.70 0.10 1.71 12.16 0.02 12.71 1. 2.55 0.00 1.03 3.30 2.86 34.38 -0.58 19.37 2.07 8.67 0.06 2.26 2.63 -0.56 11.11 0.50 9.11 16.75 9.07 0.08 34.24 55.29 1.19 2.14 1.75 9.06 1.03 299.52 0.00 0.73 2.28 1.79 107.45 3.34 15.39 7.10 2.17 -52.48 5.77 1.05 1.83 0.00 37.30 1.80 12.98 0.73 -54.19 11.10 1.91 1.15 NM 0.70 27.22 0.00 5.77 3.14 10.06 6.00 0.00 389.74 1.91 1.63 1.07 0.00 1.33 11.37 0.00 2.25 6.76 NM 12.60 10.53 1.75 1.75 Figure 102: List of companies mentioned in this report (Contd.)

Source: Company data, Deutsche Bank estimates Bank Deutsche data, Company Source:

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Yield Sales EBITDA OC 33 0.40 9.36 11.52 9.56 0.00 0.00 0.34 2.53 1.12 0.78 0.89 29.95 26.03 22.80 0.12 0.59 4.72 16.76 4.50 EPS 39 2.67 3.14 11.68 10.44 8.88 0.50 1.79 1.99 6.69 1.97 27.82 0.91 1.21 1.66 11.90 8.96 6.53 0.00 0.00 0.78 4.54 2.71 cap. of as Target- Downs. since Sharecl. 05/04/2013 price potential last 2012E 2013E 2014E 2012E 2013E 2014E 2013E 2013E tg Agtg 126 13.35 14.00 4.87 4.32 0.88 1.10 1.46 15.15 12.14 9.15 0.40 3.00 1.20 5.23 0.97 oc Agoc 8 7.08 -15.71 -1.18 -0.81 -0.34 -5.98 -8.75 -20.86 0.00 0.00 0.37 17.38 1.59 Y V (Euro m) EUREUR in (%) 3M (%) EUR EUR EUR EUR (%) 13E 13E 13E T9G.DE B OCG.DE H TFAG.DEUTDI.DEWDIG.DEOBCGn.DETechnology ADAG.DE HAIXGn.DEDLGS.DE B H Focus Tomorrow ELGG.DE H Internet United EUCAn.DE WirecardGGS.DE Ag Xing KBCG.DE HQSCG.DE BSMHNn.DE Adva H Aixtron HTelecommunications HPlc Semiconductor Dialog FNTGn.DE Elmos Euromicron H 79 H 1,812 B H Ag Gigaset Ag Kontron Ag Qsc Ag Microtec Suess 4.18 1,944 18.55 791 B 22.00 4.00 94 20.28 Ag Freenet 18.60 10.87 -4.31 16.00 39.60 16.21 15.00 9.89 177 -21.10 913 50.00 0.79 0.27 37.99 127 11.85 1.08 0.31 - 180 26.26 0.68 1.39 66 11.31 3.78 0.41 56 164 -0.71 15.55 14.00 23.52 4.50 1.78 17.00 15.62 9.09 242 8.13 1.94 23.78 0.92 19.02 4.29 17.15 9.00 2.49 1,606 10.98 13.49 9.32 7.40 -13.25 1.20 -1.10 3.70 -21.61 13.38 2.43 0.40 -0.95 22.24 10.13 -0.08 -8.98 2.25 0.35 18.28 0. -13.69 30.43 2.80 0.08 -8.19 0.50 1.96 -14.85 20.40 17.00 5.87 -8.51 0.19 2.43 1.89 -0.26 -10.26 15.18 -0.16 0.38 1.91 0.23 15.88 -0.32 1.40 -7.00 11.39 0.24 0.57 -135.21 1.29 0.25 -0.21 0.65 6.90 24.01 0.13 0.72 9.11 NA 6.70 22.78 1.90 0.21 46.86 -3.54 6.49 1.64 21.24 0.00 7.92 1.83 -26.59 1.75 0.20 1.92 39.15 1.86 -2.88 14.25 17.80 18.34 0.00 6.40 6.73 35.99 3.23 0.40 9.61 -4.46 11.31 11.68 NM 150.04 0.00 0.00 0.25 2.82 2.57 9.99 12.32 0.00 0.50 0.08 0.00 0.10 3.08 0.95 0.09 9.85 0.60 5.31 12.12 1.87 1.20 4.11 0.86 1.70 3.22 0.39 1.35 0.70 0.70 0.75 6.56 6.00 3.81 0.87 0.66 1.30 7.42 1.67 Retail CLSGn.DEDEXGn.DEDOHG.DEFIEG.DEHAWG.DEHBHG_p.DEMEOG.DE HMEOG_p.F SPRAG.DE Ag Celesio HTTKG.DE Ag Delticom TIMGn.DE S H Douglas BZO1G.DE Fielmann Hawesko H Holding Hornbach Software HBC8G.DE Ord Metro BCOPMa.DE Pref Metro HPSAGn.DE B PraktikerSOWG.DE B Takkt Tipp24 1,139 Ag Zooplus 204 H B 351 14.69 B Bechtle Ag Medical 113 Compugroup B 35.90 13.50 Ag Psi 799 155 28.00 49.58 Ag Software 3,172 38.13 -8.07 64.00 -22.01 65 11.32 38.00 73.20 43.00 29.08 8.32 22.01 1.21 60.00 40.00 167 -0.33 391 1.80 23.00 -5.10 1.28 -18.03 NA 1.75 -6.98 130 -0.14 4.79 1.40 209 263 -0.57 4.52 2.34 1.48 1.10 3.97 16.75 2.50 12.10 3.03 2.16 -3.93 4.84 23.00 41.23 1.72 2.60 12.83 41.31 19.98 3.08 2.23 1.89 490 2.19 50.00 11.51 1,810 12.00 50.00 10.35 135.72 3.10 37.31 1.93 20.53 2.43 -15.52 25.72 20.06 191 21.29 10.50 2.12 21.04 -6.47 -2.78 12.48 24.19 36.10 27.90 1.36 15.37 24.26 25.00 0.38 -0.45 28.81 17.66 8.73 33.00 -5.94 11.61 -0.35 38.00 1.50 1.57 10.25 15.36 23.74 0.06 1.02 5.49 19.62 1.89 0.24 1.76 17.09 2.61 0.67 18.00 1.04 -8.57 11.42 36.23 3.38 1.93 23.60 1.07 4.38 0.19 -0.40 1.00 -10.58 17.70 1.19 16.32 12.36 3.36 0.83 2.12 2.63 17.23 -119.32 1.35 10.37 2. 1.62 6.86 2.73 0.44 13.04 -2.43 -0.42 12.56 2.62 1.02 11.14 170.93 3.14 7.52 0.95 3.59 0.44 0.59 9.47 3.76 6.28 3.32 19.89 2.43 12.36 38.56 0.79 4.62 0.82 9.50 12.20 6.07 0.00 0.89 12.51 0.16 0.00 1.00 13.23 0.53 10.34 10.80 1.73 12.28 7.83 0.32 2.92 0.00 4.13 26.00 11.49 5.00 0.00 3.14 0.25 0.95 0.63 2.15 2.49 19.43 10.88 12.10 18.58 87.05 1.12 1.24 1.04 8.52 0.93 15.43 6.61 7.77 2.17 4.15 0.42 1.02 2.87 1.69 NM 0.30 2.71 5.75 1.05 1.62 0.16 9.81 3.93 2.92 0.95 Transportation & Logistics & Transportation AB1.DEFRAG.DEHHFGn.DESIXG.DESIXG_p.FTUIGn.DE B B H Berlin Air Ag Fraport H Hhla H B Ag Sixt Pref Sixt N Stk Tui 1,579 121 43.11 425 223 2.14 237 52.00 1,137 3.50 17.24 20.64 15.48 17.00 7.79 -2.21 63.55 NA 16.00 10.30 2.58 41.33 -1.36 -0.39 2.52 -10.54 3.36 32.19 -0.42 3.10 0.95 -6.14 0.06 4.34 0.75 1.72 16.69 0.77 0.85 1.63 -5.50 0.67 17.09 1.84 -5.70 18.13 NA -5.05 1.72 13.89 8.99 22.84 10.16 1.63 1.25 36.95 1.84 0.00 20.28 9.48 11.69 2.90 0.55 2.55 0.00 8.41 1.16 3.19 7.43 0.63 145.16 1.54 1.11 0.00 5.70 4.06 6.21 1.26 0.00 1.90 0.14 4.03 2.18 1.04 1.48 0.63 1.26 4.03 1.04 Ticker Rec. Company FF-Market Price Upside/ Perf. P/ERatio Y Div. Div. EV/ V EV/ EV/ Utilities MVVGn.DERWEG_p.F H NR Energie Mvv Pref Rwe 200 1,012 22.88 28.22 19.00 -16.96 -7.42 1.47 1.45 1.44 -3.05 15.61 4.15 4.35 15.80 3.95 15.88 6.80 0.90 3.92 6.48 0.83 7.14 7.85 2.10 1.09 7.44 0.75 4.35 0.67 Figure 103: List of companies mentioned in this report (Contd.)

Source: Company data, Deutsche Bank estimates Bank Deutsche data, Company Source:

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9 April 2013 Made in Germany Special Report

Appendix 1

Important Disclosures

Additional information available upon request

For disclosures pertaining to recommendations or estimates made on securities other than the primary subject of this research, please see the most recently published company report or visit our global disclosure look-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr

Analyst Certification The views expressed in this report accurately reflect the personal views of the undersigned lead analyst(s). In addition, the undersigned lead analyst(s) has not and will not receive any compensation for providing a specific recommendation or view in this report. Lars Slomka/Jan Rabe

Equity rating key Equity rating dispersion and banking relationships

Buy: Based on a current 12- month view of total 400 share-holder return (TSR = percentage change in 350 53 % share price from current price to projected target price 300 39 % plus pro-jected dividend yield ) , we recommend that 250 200 investors buy the stock. 150 46 % 38 % Sell: Based on a current 12-month view of total share- 100 8 %46 % holder return, we recommend that investors sell the 50 stock 0 Buy Hol d Sel l Hold: We take a neutral view on the stock 12-months out and, based on this time horizon, do not recommend either a Buy or Sell. Companies Covered Cos. w/ Banking Relationship Notes: European Universe

1. Newly issued research recommendations and target prices always supersede previously published research. 2. Ratings definitions prior to 27 January, 2007 were: Buy: Expected total return (including dividends) of 10% or more over a 12-month period Hold: Expected total return (including dividends) between -10% and 10% over a 12- month period Sell: Expected total return (including dividends)

of -10% or worse over a 12-month period

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9 April 2013 Made in Germany Special Report

Regulatory Disclosures 1. Important Additional Conflict Disclosures Aside from within this report, important conflict disclosures can also be found at https://gm.db.com/equities under the "Disclosures Lookup" and "Legal" tabs. Investors are strongly encouraged to review this information before investing. 2. Short-Term Trade Ideas Deutsche Bank equity research analysts sometimes have shorter-term trade ideas (known as SOLAR ideas) that are consistent or inconsistent with Deutsche Bank's existing longer term ratings. These trade ideas can be found at the SOLAR link at http://gm.db.com. 3. Country-Specific Disclosures Australia and New Zealand: This research, and any access to it, is intended only for "wholesale clients" within the meaning of the Australian Corporations Act and New Zealand Financial Advisors Act respectively. Brazil: The views expressed above accurately reflect personal views of the authors about the subject company(ies) and its(their) securities, including in relation to Deutsche Bank. The compensation of the equity research analyst(s) is indirectly affected by revenues deriving from the business and financial transactions of Deutsche Bank. In cases where at least one Brazil based analyst (identified by a phone number starting with +55 country code) has taken part in the preparation of this research report, the Brazil based analyst whose name appears first assumes primary responsibility for its content from a Brazilian regulatory perspective and for its compliance with CVM Instruction # 483. EU countries: Disclosures relating to our obligations under MiFiD can be found at http://www.globalmarkets.db.com/riskdisclosures. Japan: Disclosures under the Financial Instruments and Exchange Law: Company name - Deutsche Securities Inc. Registration number - Registered as a financial instruments dealer by the Head of the Kanto Local Finance Bureau (Kinsho) No. 117. Member of associations: JSDA, Type II Financial Instruments Firms Association, The Financial Futures Association of Japan, Japan Investment Advisers Association. Commissions and risks involved in stock transactions - for stock transactions, we charge stock commissions and consumption tax by multiplying the transaction amount by the commission rate agreed with each customer. Stock transactions can lead to losses as a result of share price fluctuations and other factors. Transactions in foreign stocks can lead to additional losses stemming from foreign exchange fluctuations. "Moody's", "Standard & Poor's", and "Fitch" mentioned in this report are not registered credit rating agencies in Japan unless “Japan” or "Nippon" is specifically designated in the name of the entity. Russia: This information, interpretation and opinions submitted herein are not in the context of, and do not constitute, any appraisal or evaluation activity requiring a license in the Russian Federation.

Deutsche Bank AG/London Page 69

David Folkerts-Landau Global Head of Research

Marcel Cassard Ralf Hoffmann & Bernhard Speyer Guy Ashton Richard Smith Global Head Co-Heads Chief Operating Officer Associate Director CB&S Research DB Research Research Equity Research

Asia-Pacific Germany North America Fergus Lynch Andreas Neubauer Steve Pollard Regional Head Regional Head Regional Head

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