June 10, 2011 Company Report

Shinsegae (004170 KS)

Department stores experiencing a boom Mina Kim +822-768-4163 [email protected]

Initiate coverage with Buy and TP of W386,000 following the company split Alison Jung We initiate our coverage on the post-split with a Buy call and a target +822-768-4173 price of W386,000 (Shinsegae was split into Shinsegae (department store [email protected] operations) and Emart (discount store operations) on May 1, 2011). Using a sum-of- the-parts methodology, we derived the value of ShinsegaeÊs operations

(W305,170/sh) by applying a P/E of 15x to our 2011F EPS. We arrived at the companyÊs equity-stakes value (W80,665/sh) by adding the value of Life Insurance shares (W48,650/sh; based on the June 9th closing price of W92,700) to the value of its Shinsegae International shares (W32,000/sh; based on a fair P/E of

10x). As of now, Shinsegae has no plan to sell its shares. Buy (Relisting)

In the near term, Shinsegae seems preferable to Emart Target Price (12M, W) 386,000 Share Price (06/09/11, W) 270,000 Following the company split, we believe that Shinsegae shares are preferable to Expected Return (%) 43.0 Emart shares, as ShinsegaeÊs department store operations are projected to stay EPS Growth (11F, %) -28.7 brisk in light of favorable economic indicators, consumer spending patterns, and the Market EPS Growth (11F, %) 24.9 companyÊs growth strategies. P/E (11F, x) 13.3 Market P/E (11F, x) 10.5 1) Economic indicators and consumption patterns appear favorable to the KOSPI 2,071.42 department store business. Shinsegae achieved same-store sales growth of 10% Market Cap (Wbn) 2,658 YoY in 1Q11. This growth rate is projected to stay at around 10% in 2H11. 2) Shares Outstanding (mn) 10 Shinsegae plans to fuel its top-line growth by expanding the floor sizes of its existing Avg Trading Volume (60D, '000) 65 stores and opening new stores. 3) Shinsegae is likely to advance into new business Avg Trading Value (60D, Wbn) 17 areas (in addition to its department store operations) in order to secure new growth Dividend Yield (11F, %) 0.9 Free Float (%) 61.2 engines. The company is aiming to enhance its online shopping mall operations 52-Week Low 241,500 (Shinsegae Mall) in response to consumersÊ growing pursuit of convenience, as well 52-Week High 628,000 establish detailed plans for fashion specialty stores and premium food offerings. Beta (12M, Daily Rate of Return) 0.6 Price Return Volatility (12M Daily,%,SD) 1.7 Long-term momentum to stem from the success of new businesses Foreign Ownership (%) 12.9 Although Shinsegae appears attractive in the short term, we believe that its long- Major Shareholder(s): Aberdeen Asset Mngt Asia et al (38.79%) term momentum will come from the success of its new businesses. Currently, the M.H. Lee et al. (27.13%) companyÊs department store business is being driven by favorable market factors, OppenheimerFunds, Inc.(OFI) (23.15%) such as solid consumer spending and higher asset value. However, it should be Price Performance noted that it is usually difficult for department store companies to swiftly adapt to (%) 1M 6M 12M changes in the market environment and consumer whims. Given that Shinsegae has Absolute 0.0 -6.4 8.7 no plans to expand abroad, the company should look for opportunities in the Relative 3.2 -10.6 -17.1 domestic market. § Earnings & Valuation Metrics Share price 140 KOSPI OP EV/ Sales OP NP EPS EBITDA FCF ROE P/E P/B FY Margin EBITDA 120 (Wbn) (Wbn) (Wbn) (W) (Wbn) (Wbn) (%) (x) (x) (%) (x) 100 12/09 10,002 919 9.2 568 15,059 1,226 121 13.7 17.8 2.3 11.4 80 12/10 11,025 994 9.0 1,077 28,548 1,331 -66 18.4 10.8 1.6 11.1 12/11F 1,653 263 15.9 200 20,345 327 328 4.3 13.3 1.3 34.6 60 12/12F 1,788 273 15.3 207 20,982 347 286 9.4 12.9 1.1 33.0 40 12/13F 1,918 280 14.6 211 21,446 363 313 8.8 12.6 1.1 31.7 6/10 10/10 2/11 6/11 Source: Company data, Daewoo Securities Research estimates

Please read carefully important disclosures at the end of this report. June 10, 2011 Shinsegae

1. Initiate coverage with Buy and TP of W386,000 following the company split

Split into Shinsegae and On May 1st, Shinsegae was split into Shinsegae (department store division) and Emart Emart (discount store division). The company believes that this move will enable the divisions to make efficiency improvements and to better execute their strategies. Department stores will focus on premium positioning, while discount stores will continue to implement a low cost/low price strategy. Shinsegae (004170 KS; a surviving entity) and Emart (139480 KS; a new entity) are scheduled to be listed on the on June 10th.

Table 1. ShinsegaeÊs split details Original company New company Company Shinsegae Emart Main business Department store Discount store Split ratio (%) 26.1 73.9 Listing after company split Change listing Relisting Chosun Hotel, Shinsegae Food, Shinsegae I&C, Shinsegae International, Shinsegae Chelsea, Subsidiaries Shinsegae E&C, Korea, Shinsegae L&B, Emart Shinsegae, Shinsegae China subsidiaries (10) Total shareholder's equity (before split) 7,400 Total shareholder's equity (after split) 1,909 5,492 # of shares (before split, mn shares) 37.7 # of shares (after split, mn shares) 9.8 27.9 Share price (before split, 4/28/11, W) 270,000 Share price (after split, W) 270,000 270,000 Market cap (before split, 4/28/11) 10,185 Market cap (after split) 2,658 7,526 Relisting/change listing date Jun. 10, 2011 Price range (%) 50~200% Min 50% (W) 135,000 Max 200% (W) 540,000 Source: Company data, Daewoo Securities Research

Figure 1. Corporate structure before split Figure 2. Corporate structure after split

Chosun 45.0% 98.8% Chosun Hotel Lee, Myung Hee Hotel Bakery & Affiliates 1.1% Lee, Myung Hee & Affiliates 25.0% ShinsegaeShinsegae Food Food 52.1% Shinsegae (031440 KS) Chelsea (031440 KS) 27.1 1.1% 27.1% 10.3% 6.8% 10.4% 27.1% 30.9% % 98.8% 10.4% 63.6% 25.0% 32.4% ShinsegaeShinsegae E&C E&C ShinsegaeShinsegae I&C I&C GwangjuGwangju Shinsegae Shinsegae ShinsegaeShinsegae Shinsegae Chosun Hotel E-MartE-Mart (034300(034300 KS)KS) (035510(035510 KS)KS) (037710(037710 KS)KS) (004170(004170 KS)KS) International Shinsegae E&C 32.4% Shinsegae 65.1% Shinsegae E&C Shinsegae Shinsegae (034300 KS) (004170 KS) (034300 KS) (004170 KS) International 29.0% 25.0% 10.3% 31.6% 45.0% Shinsegae 98.1% 27.6% 25.0% Shinsegae 25.0% Chosun Hotel Bakery Uijeong- bu 100% Shanghai Branch I Chelsea Shinsegae L&B 29.0% Station Co. Shinsegae I&C 82.5% Shinsegae I&C Tianjin Branch (035510(035510 KS)KS) 6.6% 45.0% Shinsegae Chelsea 19.9% 45.0% Shinsegae Uijeong-bu 27.6% 100% Station Co. Shanghai Branch II 50.0% 52.1% 50.0% 27.6% 100% 25.0% Starbucks Coffee Shinsegae Food Shinsegae Uijeong-bu 100% Korea Shinsegae Food Starbucks Coffee Korea Shinsegae L&B Wuxi Branch (031440 KS) Station Co. 10.4% (031440 KS) 19.9% GwangjuGwangju Shinsegae Shinsegae (037710 KS) (037710 KS) 100% 52.1% Beijing Branch 83.3% 100% 98.8% 100% 100%

100% Tianjin Branch Shanghai Branch II Shanghai Branch I Wuxi Branch Beijing Branch Kunshan Branch

100% 100% Shangzhou Branch Ningbo Branch 100% 100% 100% 100% 100% 100% 100% Taizhou Branch Hangzhou Branch Kunshan Branch Shangzhou Branch Ningbo Branch Taizhou Branch Hangzhou Branch

Source: Company data, Daewoo Securities Research Source: Company data, Daewoo Securities Research

Daewoo Securities Research 2 June 10, 2011 Shinsegae

Buy rating with target We initiate our coverage on the post-split Shinsegae with a Buy call and a target price of price of W386,000 W386,000 (Shinsegae was split into Shinsegae (department store operations) and Emart (discount store operations) on May 1, 2011). Using a sum-of-the-parts methodology, we derived the value of ShinsegaeÊs operations (W305,170/sh) by applying a P/E of 15x to our 2011F EPS. We arrived at the companyÊs equity-stakes value (W80,665/sh) by adding the value of Samsung Life Insurance shares (W48,650/sh; based on the June 9th closing price of W92,700) to the value of its Shinsegae International shares (W32,000/sh; based on a fair P/E of 10x). As of now, Shinsegae has no plan to sell its Samsung Life Insurance shares.

We recommend a Buy rating on Shinsegae based on the following investment points:

1) Economic indicators and consumption patterns appear favorable to the department store business. Domestic consumption is projected to gradually grow at 3.3% YoY in 3Q11 and 3.5% YoY in 4Q11.

The domestic department store segment showed stagnant growth from 2003 to 2007; however, thanks to 1) solid consumption by high-end consumers, 2) the trading-up pattern by mid-to-high end consumers, and 3) greater emphasis on quality than quantity, the division is projected to record a CAGR of 10.6% from 2008 to 2011. Shinsegae achieved same-store sales growth of 10% YoY in 1Q11. This growth rate is projected to remain at around 10% in 2H11.

2) Shinsegae plans to fuel its top-line growth by expanding the floor sizes of its existing stores and opening new stores. The company currently operates nine stores, and plans to open three new stores in Uijeongbu, and by 2015.

3) Shinsegae plans to advance into new business areas in order to secure new growth engines. The company is aiming to enhance its online shopping mall operations (Shinsegae Mall) in response to consumersÊ growing pursuit of convenience, as well as establish detailed plans for fashion specialty stores and premium food offerings.

Table 2. Shinsegae's valuation 2011F Comments 1.Operating value Adj. net profit (Wbn) 200.3 Shares outstanding (mn) 9.8 Operating value EPS (W) 20,344.7 Target P/E (X) 15.0 Robust growth in department store division Operating value per share (W) 305,170 1. Samsung LifeÊs asset value 0.0 Stake (%) 3.7 Number of shares (mn) 7.4 Share price (W) 92,700 As of June 9, 2011 Value of SLI (Wbn) 684.2 Discount rate (%) 30.0 Value of Samsung Life (Wbn) 479.0 Asset value 2. Shinsegae InternationalÊs asset value 0.0 Stake (%) 63.6 Number of shares (mn) 3.3 Adj. net profit (Wbn) 49.6 Target P/E (X) 10.0 Target P/E of LG Fashion Value of Shinsegae International (Wbn) 315.2 Shares outstanding (mn) 9.8 Asset value per share (W) 80,664.7 Target price (W) 385,835 Source: Company data, Daewoo Securities Research estimates

Daewoo Securities Research 3 June 10, 2011 Shinsegae

2. In the near term, Shinsegae seems preferable to Emart

Shinsegae is preferable Following the company split, we believe that Shinsegae shares are preferable to Emart to Emart shares, as ShinsegaeÊs department store operations are projected to stay brisk in light of favorable economic indicators, consumer spending patterns, and the companyÊs growth strategies.

1) Economic indicators and consumption patterns appear favorable to the department store business. Domestic consumption is projected to gradually grow at 3.3% YoY in 3Q11 and 3.5% YoY in 4Q11.

The domestic department store segment showed stagnant growth from 2003 to 2007; however, thanks to 1) solid consumption by high-end consumers, 2) the trading-up pattern by mid-to-high end consumers, and 3) greater emphasis on quality than quantity, the division is projected to record a CAGR of 10.6% from 2008 to 2011. The robust sales growth of the luxury brand Louis Vuitton Korea exemplifies the trading-up consumption pattern. Since 2005, Louis Vuitton has recorded double-digit growth per annum (even during the global financial crisis in 2008) and has increased prices by at least 5% every year. Shinsegae achieved same-store sales growth of 10% YoY in 1Q11. This growth rate is projected to remain at around 10% in 2H11 on the back of stable spending by high-end consumers, trading-up by mid-level consumers, and preference for quality over quantity.

Figure 3. KoreaÊs department store market size

(Wtr) (YoY, %) 35 Market size (L) Growth rate (R) 15 CAGR: 10.6%

28 CAGR: 8.6% 10

21 5

14

0 7

0 -5 00 01 02 03 04 05 06 07 08 09 10 11F

Source: Statistics Korea, Daewoo Research Center estimates

Figure 4. Louis Vuitton KoreaÊs earnings trend

(Wbn) (YoY, %) 500 Sales (L) 5% price increase in 80 Growth (R) Feb. 2011 66% YoY growth in 400 2008 (global financial crisis) 60

300 40

200 20

100 0

0 -20 04 05 06 07 08 09 10

Source: Louis Vuitton Korea, Daewoo Research Center

Daewoo Securities Research 4 June 10, 2011 Shinsegae

Expand floor sizes of 2) Shinsegae plans to fuel its top-line growth by expanding the floor sizes of its existing 5 existing stores; stores and opening new stores. The company currently operates nine stores, and plans to open 3 new stores open three new stores in Uijeongbu, Daegu and Hanam by 2015. In the long term, the company aims to achieve sales and operating profit of W8tr and W600bn in 2015, respectively, and sales and operating profit of W15tr and W1.5tr in 2020. Since 2008, the company has invested roughly W310bn per annum, but the number should increase to around W400bn in line with its business expansion plan.

Table 3. Shinsegae's long term targets (Wbn,%) 2005 2008 2009 2010 2015 2020 No. of stores 7 7 7 9 12 17 Sales 1,800.0 2,600.0 3,100.0 3,900.0 8,000.0 15,000.0 Operating profit 130.0 195.6 187.4 258.5 600.0 1,500.0 OP margin 7.2 7.5 6.0 6.6 7.5 10.0 Source: Company data, Daewoo Securities Research

Shinsegae's top-line growth will also be driven by the enlargement of its existing stores. By sales, four of Shinsegae's stores were ranked among the top ten in Korea (Gangnam came in second, the main store fifth, Centum City ninth, and tenth).

Shinsegae plans to expand five existing stores.

First, the company plans to create the shopping mall (27,000-pyeong), which will encompass the Myeongdong store (17,000 pyeong), the adjacent Mesa building (which it acquired in November 2008 for W130bn), and the neighboring areas. In addition, the company aims to gradually expand the Centum City store in Busan from 38,000 pyeong to 58,000 pyeong. Shinsegae plans to lure more customers to the Centum City store by attracting new brands, including global SPA (Specialty Retailer of Private Label Apparel) brands. Furthermore, the company is forecast to expand the Jukjeon store from 13,000 pyeong to 15,000 pyeong, as well as expand the Gangnam and Time Square stores.

Shinsegae is also scheduled to open three new shopping complexes by 2015 - Uijeongbu (15,000 pyeong), Daegu (30,000 pyeong), and Hanam (35,000 pyeong). The new shopping complexes will each accommodate a department store, an Emart, a movie theater, and other facilities.

Figure 5. New store openings of major retailers Company Opening year Air view Gimpo Skypark 2011 Suwon KCC 2012 Lotte Shopping Pyeongchon 2012 2nd Lotte World 2013 Incheon Songdo 2013

Daegu 2011 Cheongju 2012 Hyundai Yangjae 2013 Department Ansan 2014 Store Gwanggyo 2014 Pangyo 2014 Asan 2015

Uijeongbu 2012 Shinsegae Daegu 2014 Hanam 2015

Source: Company data, Daewoo Securities Research

Daewoo Securities Research 5 June 10, 2011 Shinsegae

Advance into new 3) Shinsegae plans to advance into new business areas (in addition to its department store businesses: operations) in order to secure new growth engines. The company is aiming to enhance its fashion specialty store, online shopping mall operations (Shinsegae Mall) in response to consumersÊ growing pursuit premium food offerings of convenience, as well establish detailed plans for fashion specialty stores and premium food offerings.

The online market, which allows consumers to easily compare prices/shop conveniently and enables retailers to quickly reflect the latest trends, is expected to account for 14% of the retail market in 2011 (sales growth of 20% YoY). Shinsegae Mall aims to achieve annual sales of W2tr by 2015 by utilizing social networks, smartphones and new media platforms.

3. Long-term momentum to stem from the success of new businesses

Long-term momentum Although Shinsegae appears attractive in the short term, we believe that its long-term to hinge on the success momentum will hinge on the success of its new businesses. Currently, the companyÊs of its new businesses department store business is being driven by favorable market factors, such as solid consumer spending and higher asset value. However, it should be noted that it is usually difficult for department store companies to swiftly adapt to changes in the market environment and consumer whims. Given that Shinsegae has no plans to expand abroad, the company should look for opportunities in the domestic market.

In addition, since department stores require greater initial investments than discount stores, supermarkets, or convenient stores, it takes more time for a new department store to break even (three years on average).

Shinsegae needs to ensure that its new ventures (premium food offerings, fashion specialty stores, online shopping mall operations) generate as much profit as its department store business in the long term.

Figure 6. ShinsegaeÊs gross sales forecasts Figure 7. ShinsegaeÊs operating profit forecasts (Wbn) (YoY, %) (Wbn) (%) 300 7.0 5,000 Gross sales (L) 35 Operating profit (L) Growth rate (R) OP margin (R) 250 4,000 28 6.6 200 3,000 21 150 6.2 2,000 14 100 5.8 1,000 7 50

0 0 0 5.4 06 07 08 09 10 11F 12F 06 07 08 09 10 11F 12F

Source: Company data, Daewoo Securities Research estimates Source: Company data, Daewoo Securities Research estimates

Daewoo Securities Research 6 June 10, 2011 Shinsegae

Shinsegae (004170 KS/Buy/TP: W386,000)

Income Statement (Summarized) Balance Sheet (Summarized) (Wbn) 12/10 12/11F 12/12F 12/13F (Wbn) 12/10 12/11F 12/12F 12/13F Sales 11,025 1,653 1,788 1,918 Current Assets 759 171 223 238 Cost of Goods Sold 7,309 417 452 484 Cash and Cash Equivalents 19 9 33 37 Gross Profit 3,716 1,235 1,337 1,433 Accounts Receivable 150 72 60 65 SG&A 2,722 972 1,064 1,154 Inventories 390 38 76 82 Operating Profit 994 263 273 280 Other Current Assets 200 53 53 54 Non-Operating Income 440 4 2 2 Non-Current Assets 12,943 3,937 4,264 4,581 Interest Income/Expense -134 -31 -40 -45 Investment Assets 4,058 1,265 1,265 1,266 F/X-Related Gain/Loss 19 0 0 0 Property, Plant and Equipment 8,910 2,680 3,008 3,326 Equity Method Gain/Loss -24 6 13 17 Intangible Assets -25 -8 -10 -12 Asset Disposal Gain/Loss 542 1 1 1 Total Assets 13,702 4,108 4,486 4,818 Other Non-Operating Profit/Loss 36 27 28 28 Current Liabilities 3,794 994 1,019 1,043 Pretax Profit 1,434 267 275 281 Accounts Payable 660 261 282 303 Tax 357 66 68 70 Short-Term Debt 213 56 56 56 Profit from Continuing Operation 1,077 200 207 211 Current Long-Term Debt 1,245 325 325 325 Profit from Discontinued Operation 0 0 0 0 Other Current Liabilities 1,677 352 356 360 Tax Effect 0 0 0 0 Non-Current Liabilities 2,634 1,012 1,164 1,267 Net Profit 1,077 200 207 211 Bonds 1,325 547 597 647 Residual Income 1,077 200 207 211 Long-Term Debt 387 201 301 351 EBITDA 1,331 327 347 363 Other Non-Current Liabilities 923 264 267 269 Free Cash Flow -66 328 286 313 Total Liabilities 6,429 2,005 2,183 2,310 Gross Profit Margin (%) 33.7 74.8 74.8 74.7 Paid-In Capital 94 122 122 122 EBITDA Margin (%) 12.1 19.8 19.4 19.0 Capital Surplus 723 0 0 0 Operating Margin (%) 9.0 15.9 15.3 14.6 Retained Earnings 4,652 8,147 8,347 8,552 Net Margin (%) 9.8 12.1 11.6 11.0 Stockholders' Equity 7,273 2,103 2,303 2,508

Cash Flow (Summarized) Forecasts/Valuations (Summarized) (Wbn) 12/10 12/11F 12/12F 12/13F 12/10 12/11F 12/12F 12/13F Cash Flow from Operating Activities 1,184 328 286 313 P/E (x) 10.8 13.3 12.9 12.6 Net Profit 1,077 200 207 211 P/CF (x) 8.2 9.4 8.9 8.4 Non-Cash Income and Expense -127 93 82 89 P/B (x) 1.6 1.3 1.1 1.1 Tangible Assets Depreciation 331 62 72 82 EV/EBITDA (x) 11.1 34.6 33.0 31.7 Intangible Assets Depreciation 6 2 2 2 EPS (W) 28,548 20,345 20,982 21,446 Others -464 30 8 6 CFPS (W) 37,314 26,664 28,302 29,769 Chg in Working Capital 234 35 -2 13 BPS (W) 193,462 214,403 234,937 255,950 Chg in Accounts Receivable -15 -33 11 -5 DPS (W) 2,500 2,500 2,500 2,500 Chg in Inventories -124 64 -38 -6 Payout Ratio (%) 4.4 - - - Chg in Accounts Payable 65 0 21 21 Dividend Yield (%) 0.4 0.9 0.9 0.9 Others 309 3 3 3 Sales Growth (%) 10.2 -85.0 8.2 7.3 Cash Flow from Investment Activities -835 -618 -406 -404 EBITDA Growth (%) 8.6 -75.4 6.1 4.8 Chg in Tangible Assets -1,250 -387 -386 -385 Operating Profit Growth (%) 8.1 -73.5 3.8 2.4 Chg in Intangible Assets -14 0 0 0 EPS Growth (%) 89.6 -28.7 3.1 2.2 Chg in Investment Assets 344 -200 0 0 Accounts Receivable Turnover (x) 77.6 14.9 27.1 30.6 Others 84 -31 -20 -18 Inventory Turnover (x) 32.2 7.7 31.5 24.3 Cash Flow from Financing Activities -351 294 144 94 Accounts Payable Turnover (x) 17.6 3.6 6.6 6.6 Chg in Borrowings -409 300 150 100 ROA (%) 8.9 2.3 4.8 4.5 Chg in Equity -24 -6 -6 -6 ROE (%) 18.4 4.3 9.4 8.8 Dividends -24 -6 -6 -6 ROIC (%) 9.7 4.0 8.3 7.5 Others 82 0 0 0 Liability to Equity Ratio (%) 88.4 95.4 94.8 92.1 Chg in Cash -2 4 24 3 Current Ratio (%) 20.0 17.2 21.8 22.8 Beginning Cash Balance 21 19 9 33 Net Debt to Equity Ratio (%) 43.3 53.2 54.1 53.5 Ending Cash Balance 19 23 33 37 Interest Coverage Ratio (x) 5.7 6.7 5.7 5.3 Source: Company data, Daewoo Securities Research estimates

Daewoo Securities Research 7 June 10, 2011 Shinsegae

Important Disclosures & Disclaimers

As of the publication date, Daewoo Securities Co., Ltd. has acted as a liquidity provider for single stock futures backed by shares of Shinsegae as an underlying asset, and other than this, Daewoo Securities has no other special interests in the covered companies. Analyst of the subject company or member of the analyst's household does not have any financial interest in the securities of the subject company and the nature of the financial interest (including without limitation, whether it consists of any option, right, warrant, future, long or short position). This report reflects the sole opinion of the analyst without any external influences by third parties.

Buy Relative performance of 20% or greater (W) Shinsegae Stock Trading Buy Relative performance of 10% or greater, but with volatility 800,000 Ratings Hold Relative performance of -10% and 10% 600,000

Sell Relative performance of -10% 400,000

Overweight Fundamentals are favorable or improving 200,000 Industry Neutral Fundamentals are steady without any material changes Ratings 0 6/09 12/09 6/10 12/10 6/11 Underweight Fundamentals are unfavorable or worsening * Ratings and Target Price History (Share price (----), Target price (----), Not covered (■), Buy (▲), Trading Buy (■), Hold (●), Sell (◆)) * Our investment rating is a guide to the relative return of the stock versus the market over the next 12 months. * Although it is not part of the official ratings at Daewoo Securities, we may call a trading opportunity in case there is a technical or short-term material development.

This report has been provided by the research division of Daewoo Securities Co., Ltd. The stock ratings, target prices, estimates and overall viewpoints are from the research division of Daewoo Securities. Investors can access Daewoo SecuritiesÊ research directly through our website (www.bestez.com), FirstCall Research, Reuters, FnGuide, WiseFn, FactSet and Bloomberg (DWIR). This document was prepared by Daewoo Securities Co., Ltd. („Daewoo‰). Information and opinions contained herein have been compiled from sources believed to be reliable and in good faith. The information has not been independently verified. Daewoo makes no guarantee, representation or warranty, express or implied, is made as to the fairness, accuracy or completeness of the information and opinions contained in this document. Daewoo accepts no responsibility or liability whatsoever for any loss arising from the use of this document or its contents or otherwise arising in connection therewith. Information and opinions contained herein are subject to change without notice. This document is for information purposes only. It is not and should not be construed as an offer or solicitation of an offer to purchase or sell any securities or other financial instruments. This document may not be reproduced, further distributed or published in whole or in part for any purpose. Daewoo and/or other affiliate companies, their directors, representatives, or employees may have long or short positions in any of the securities or other financial instruments mentioned in this document or issuers described herein at any time and may purchase and/or sale, or offer to purchase and/or sale such securities or other financial instruments in the open market or otherwise, in each case either as principal or agent. This document is for distribution within the United Kingdom to persons authorized under the Financial Services Act 1986. Daewoo Securities is the sole provider of information contained in this document. DaewooÊs U.S. affiliate, Daewoo Securities (America) Inc., a member of FINRA/SIPC, is the sole distributor of this document within the U.S. This document may be distributed in the U.S. only to major U.S. institutional investors as defined in Rule 15a-6 of the U.S. Securities Exchange Act of 1934. Any U.S. recipient of this document wishing to effect any transactions in any securities discussed herein should contact and place orders with Daewoo Securities (America) Inc.

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Daewoo Securities Research 8