Equity Research

February 10th, 2020 Monthly Andean Strategy Update Maintaining our Andean allocation

In January, our markets underperformed in USD terms the global emerging markets (-4.7%) and LATAM (-5.7%). was the strong CREDICORP CAPITAL RESEARCH underperformer (-7.9%), followed by Colombia (-6.2%) and (-5.3%). However, an important part of that underperformance was driven by a significant depreciation of the local currencies (CLP: 6.5%; COP: 4.4%; PEN: 2.2%). Daniel Velandia, CFA +(571) 3394400 ext. 1505 We maintain our Overweight recommendation for Colombia. We [email protected] expect to gain more insight on the 2020E outlook in the upcoming 4Q19 conference calls. Carolina Ratto +(562) 2446 1768 ▪ The local index declined 2.3% and 6.2% in COP and USD terms, [email protected] respectively, in Jan-20. This resulted in a slight underperformance when compared to the MSCI Latam (5.7% decline in USD terms in Jan-20). Tomás Sanhueza ▪ The outlook for strong private consumption remains in place, mainly +(562) 2446 1751 driven by: i) higher real salaries, ii) strong acceleration of the consumer [email protected] loan book, iii) a higher inflow of remittances and iv) a stable outlook for inflation and rates. Sebastián Gallego, CFA ▪ Our equity strategy continues to be mainly focused on banks; despite +(571) 3394400 ext. 1594 weak monthly results in Nov-19 (most recent data), we see a bright [email protected] outlook for 2020E. ▪ Forward multiples continue to look attractive. P/E and EV/EBITDA Daniel Córdova multiples trade close to one standard deviation compared to the +(511) 416 3333 Ext. 33052 average of the last three years. We acknowledge that we continue to [email protected] expect stronger delivery in some of the key names of the local index. ▪ Our Top Picks are Bancolombia, Davivienda and Canacol. We are maintaining our Neutral rating in Chile. A good starting point in January that ended with a weak performance. ▪ The equity market continues with low activity levels by local and foreign investors, that reflects the concerns about the upcoming constitutional process and potential impacts in long term growth. ▪ Top performers during the month continue to be the less exposed sector to local consumption and regulatory risks, such as commodities and utilities. ▪ We continue to be cautious towards the market, as we approach the upcoming months that define the constitutional process. ▪ The market is trading at ~15x P/E, which does not reflect any significant discount under the current context. There should still come some estimates adjustments that could increase current valuations. ▪ Our Top Picks are Engie Chile, and Parque Arauco. We maintain our Underweight recommendation for Peru. A new Congress will bring short-term political stability, but investors remain skeptical about pro-growth measures, and external risks persist. • The coronavirus outbreak adds to concerns such as a potential deceleration of the global economy and pending US-China negotiations. • A centrist Congress could be more collaborative with the Executive, but the 2021 electoral cycle could bring political noise later in the year. • Still no clear catalysts for local equities; public investment could IMPORTANT NOTICE (US FINRA RULE 2242) This document is intended for INSTITUTIONAL INVESTORS and is not subject to all of the independence and rebound in 1H20, but the direction of metal prices is unclear again. disclosure standards applicable to debt research reports prepared for retail investors. Credicorp Capital may do or seek to do business with companies • We maintain a defensive stance in the short term, with utilities and covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. consumption-related stocks among our preferred choices. Investors should consider this report as only a single factor in1making their • We maintain InRetail and Ferreycorp as our Top Picks. investment decision. Refer to important disclosures on page 24 to 27, Analyst Certification on Page 24. Additional disclosures on page 27. Actualizar Contents Monthly Andean Strategy Update

Chile: Gettin closer to March and the intensification of constitutional discussions 5 Top Picks 7 We stick with our Overweight in Colombia; we expect to gain more insight on the 2020E outlook in the upcoming Colombia: 8 4Q19 conference calls Top Picks 13 Peru: New concerns on the external front, with no clear catalysts at home 14 Top Picks 16

Valuation Summary 17

Economic Forecasts 21

2 Actualizar LTM Andean Equities Performance (in USD)

IPSA COLCAP SP BVL General Index MSCI Latam 120

110

100

90

80

70

60 Feb-19 Apr-19 Jun-19 Aug-19 Oct-19 Dec-19 Feb-20

Source: Credicorp Capital, & Bloomberg

Andean Equities Fwd P/E (12 month rolling) vs 5Y historical average

P/E FWD vs Historical 5Y Average

20.0x 30.0% 18.0x 16.0x 14.6x 15.1x 20.0% 13.5x 14.0x 10.0% 12.0x 10.0x 0.0% 8.0x 6.0x -10.0% -17% 4.0x -20.0% 2.0x -22% -23% .0x -30.0% Chile Peru* Colombia

*Peru: vs 2Y historical average Andean Equities Fwd EV/EBITDA (12 month rolling) vs 5Y historical average

EV/EBITDA FWD vs Historical 5Y Average

7.2x 10.0% 7.1x 7.1x 5.0% 7.0x 7.0x 0.0% -5.0% 6.9x -9% -10.0% 6.8x 6.7x -16% -15.0% 6.7x -20.0% 6.6x -24% -25.0% 6.5x -30.0% Chile Peru Colombia Source: Credicorp Capital, & Bloomberg

3 Strategy Summary within Andean Context Long view Short view (12-to-18 months) (1-to -3 months) Chile Allocation: Neutral (+) Attractive entry point in some specific names We are seeing more tension due to the "yes"/"no" (+) Proper fiscal accounts responsibility to take on new social demands campaigns for the plebiscite in April. As March gets (-) Uncertainty on long term outlook for the economy closer, we believe the constitutional discussion will (-) Short to mid term impact in economy is strong, impacting performance of be the main issue and the companies' fundamentals companies becomes less relevant. (-) Correlation to the US-China trade war is still latent (-) Weaker position of the government against the opposition

Strategy: We are favoring shares with low-beta and high visibility in earnings going forward. We are avoiding cyclical names with risks related to the current crisis in Chile. Top picks: Engie Chile, Concha y Toro, Parauco Colombia Allocation: Overweight (+) Better operating/financial trends at the banking sector. The most important issues in the short term are: (+) Solid macro data supports our 3.2% GDP growth forecast for 2020E. expectations on 4Q19 results, Ecopetrol's reserves (+) Stable rates & inflation. report, global tensions, oil prices, exchange rate (-) Volatility across foreign markets. performance, the upcoming MSCI rebalancing (-) Twin deficits. process and corporate governance issues/news. (-) Labour market.

Strategy:

We remain overweight in Colombia. Our investment thesis continues to mainly rely upon: i) strong economic activity, ii) stable inflation and interest rates, iii) strong earnings momentum across the financial sector, and iv) special operations that may boost current market prices.

Top picks: Bancolombia, Davivienda, and Canacol Peru Allocation: Underweight (+) A centrist, more collaborative Congress; potential progress on the judicial and We expect IFS to report a solid 4Q19, supported on political reforms is positive in the long term. strong growth at Interbank's loan portfolio. InRetail (+) Despite some recent softening, private consumption remains resilient into 2020. should show margin expansion in 4Q19, despite a (-) The coronavirus outbreak adds to external risks, such as noise from US-China deceleration in private consumption. We still prefer negotiations coming later in the year. Luz del Sur due to the expected public acquisition (-) Still no clear short term catalysts for Peruvian equities; public investment could offer by CTG, while Engie strengthens the defensive rebound in 1H20, but the 2021 electoral cycle may be a drag on private investment stance of our trading portfolio. Lastly, we expect in 2H20. Buenaventura to benefit from a recovery in base metal prices and a strong performance of gold.

Strategy: Trading ideas: Maintaining a defensive stance as new risks arose in the external front and domestic IFS, InRetail, Luz del Sur, Engie and Buenaventura. investment lacks triggers. Our portfolio remains focused on private consumption and utilities.

Top Picks: InRetail and Ferreycorp.

4 Chile Getting closer to March and the intensification of constitutional discussions

A good start in In January, the Chilean market showed a strong outperformance in CLP (-2.1%). January that The CLP posted a strong depreciation (6.5%), leaving the IPSA index with a corrected in the last performance in USD of -7.9%. During the first month of 2020, the violence on the two weeks. streets subsided, partially due to summer vacations. However, tensions are still high and could intensify considering the opposition to proceeding normally with the university selection test, the heated discussions between legislators and the beginning of the “yes”/”no” campaigns for the plebiscite in April. Currently, it is not possible to rule out the return of violence. Uncertainty remains high, which has kept local investors on the sidelines with a neutral to negative bias towards the stock market. Foreign investors have also remained on the sidelines as the balance between risk and return has become unappealing as other EM markets are more attractive at this point. We believe this scenario will continue, which will negatively impact the local market, resulting in a stagnant market.

The biggest winners continue to be the usual suspects. In terms of sectors, commodities and utilities continue to be the favorites. Regarding the commodities sector, SQM-B and Copec have outperformed (+10.9% and +5.8%, respectively). SQM-B continues on the positive track as some electric car companies have improved their outlook for production, which directly benefits players such as SQM. Regarding the utilities sector, Enel Chile was a clear outperformer (+7.7%), which we ascribe to a strong interest in the sector coupled with a positive boost from the buyback announced by Enel. It is also important to highlight the performance of Ripley (+10.7%), which was positively impacted by the strong inflow seen after its entrance into the small cap spectrum and thus into local small cap funds. On the negative front, some regulated names such as ILC and Habitat showed a strong underperformance, which can be attributed to the pension reform discussed by the government. In addition, LATAM also underperformed the index (-11.9%) after the tender offer by Delta for 20% of the company was executed as shares returned to the levels that were seen before the announcement of the deal.

According to the BCCh, economic activity, as measured by the Imacec index, December’s posted an increase of 1.1% y/y in Dec-19, partly recovering from the strong economic activity contractions seen in Oct-19 and Nov-19 (-3.4% and -3.3% y/y, respectively). The was better than result came in above the market consensus and our own expectations (both at -0.5% expected; however, y/y). Having said that, the Chilean economy grew only 1.2% in full year 2019 (4Q19: - overall GDP growth 1.9% y/y), in line with our estimate (1.1%) and 0.2pp above the BCCh’s projection for 2019 ended up at (1.0%). The mining Imacec advanced 3.7% y/y in Dec-19, its fastest pace since Aug-19, a soft 1.2%. consistent with the low impact of the social crisis on the sector as affirmed by the BCCh. Non-mining activity grew at a more modest rate of 0.8% y/y, led by and construction, according to the BCCh’s statement (importantly, a significant part of the activity of these two sectors seems to be explained by higher demand from mining). The Dec-19 figure benefited from an additional business day vs Dec-18. In fact, the seasonally-adjusted series shows that the economy expanded a modest 0.6% y/y in Dec- 19, with the mining and non-mining gauges increasing 3.4% and 0.3% y/y, respectively. We think that the Dec-19 data should be read carefully considering year-end holidays. All-in, we continue to believe that the 1Q20 information will be key and that the developments around the expected events in Mar-20 will be critical. We maintain our 2020 GDP growth projection at 1.2%.

5 Chile Strategy

No surprises in 4Q19; weak quarter due to social turmoil. The IPSA sample posted 1.8% y/y growth in revenues, while EBITDA dropped 2.6% y/y and EPS decreased 21% y/y. We were expecting a 13% y/y EPS drop in 4Q19 prior to the social unrest that started on October 18th; therefore, there was a significant downward adjustment. In terms of sectors, banks showed a strong EPS drop, and retail suffered significantly, posting a ~53% y/y drop in earnings. We remain neutral to negative on these sectors due to risks related to the recent crisis in Chile. On the positive front, we highlight: (i) the beverages sector with better-than-expected volume and EPS growth, (ii) the telecom sector due to the sale of towers and (iii) the utilities sector driven by Enel Chile, Engie Chile and AES Gener. This quarter, we expect positive surprises for Concha y Toro, and SMU and negative surprises for CAP and Sonda.

The new implicit multiple for the index is still not clear. Including the recent adjustments in earnings for banks (~14% and ~9% for 2019 and 2020, respectively), the implicit P/E Fwd for the IPSA index stands at 14.6x. However, we have not made any adjustment to the remaining sectors (retail, utilities, food and beverages, amongst others). Our most recent update was in August 2019, prior to the start of the social unrest. Therefore, it seems that the upcoming adjustments in earnings should significantly correct the valuations of the IPSA index to a fairer level.

We continue to have a selective strategy, avoiding names related to the cyclical side and looking for names with low risk, limited exposure to the current crisis and higher certainty for 12-month earnings. This month we have not made any removals or inclusions, only relative movements.

Our Neutral rating on Chile is based on: i) uncertainty in terms of long-term economic outlook with potential pressure in Chile’s fiscal accounts, ii) potentially higher country risk due to the recent events, iii) a still-hazy outlook on the implications of the social unrest for the performance of companies in the short to long term and iv) potentially interesting opportunities after the significant drop in the equity market. For a potential recovery of the IPSA index to occur, flows from foreign and institutional investors would have to return in order to support price levels and stop the strong pressure seen in the market day after day.

P/E Forward (12-month rolling) EV/EBITDA Forward (12-month rolling)

24 12

22 11

20 10

18 9

16 8

14 7 14.6x 7.1x 12 6 Feb-14 Feb-16 Feb-18 Feb-20 Feb-14 Feb-16 Feb-18 Feb-20 Sources: Bloomberg, Company Reports and Credicorp Capital a Simple average, excluding Market Capitalization

6 Top Picks Chile

Our Top Picks are We maintain our selective strategy in the Chilean stock market, with Engie Chile, Engie Chile, Concha Concha y Toro and Parauco as our Top Picks. y Toro and Parauco. Engie Chile (BUY; T.P.: CLP 1,450). Engie Chile is our preferred play in the Latin American utilities space (excluding ) on the back of the extended duration of its PPA portfolio, its low leverage and its management/parent quality. Regarding the first factor, we believe that Engie Chile shares’ performance will negatively correlate with short-term power prices in Chile as the value of its contracts should rise with lower spot prices. Regarding debt, the substantial room for leverage allows Engie Chile to face the coal phase-out process in Chile comfortably. Finally, we remain confident that the company’s good results will continue on the back of the expansion of 375MW from the IEM project and the sales of the new SIC contract.

Concha y Toro (HOLD; T.P.: CLP 1,620). We are maintaining Concha y Toro in our Top Picks as it seems that, under the current context, Concha y Toro is one of the few names that has positive drivers and should outperform in terms of earnings momentum. The lower wine costs due to the positive 2019 harvest should remain at low levels for at least two more quarters, which will benefit margin expansion. In addition, current FX levels in Chile should benefit the top line growth of the company considering its exposure to export markets. Finally, we believe the strategic plan has been showing some delivery in recent quarters with an average price that has improved and volume growth that has gradually recovered.

Parque Arauco (BUY; T.P.: CLP 2,415). We are maintaining Parque Arauco in our Top Picks. We believe Parque Arauco is an attractive vehicle to face the environment of high volatility due to its high NOI diversification (~40% comes from outside Chile). Execution continues to be important for growth, but, in our view, management has shown that it can carry out brownfield and greenfield projects with great success in the last five years. Recent portfolio management has shown that the high level of indebtedness is not an impediment to growth. Legal risks remain but are limited for now.

Chile - Top Picks

Last Target Total Mkt. P/E FV/EBITDA P/BV Div Yield Price Price Upside Return (USD mn) 2019E 2020E 2019E 2020E LTM 2020E Sectors Engie Chile 1,150 1,450 26.1% 37.6% 1,551 8.7 7.7 4.5 4.6 0.8 11.5% Utilities Concha y Toro 1,403 1,620 15.5% 18.3% 1,342 21.0 18.3 13.8 12.0 1.8 2.8% Food & Beverages Parque Arauco 1,850 2,415 30.5% 34.5% 2,146 16.3 16.0 17.2 16.2 1.7 4.0% Real Estate Chilean Picks a 24.0% 30.2% 5,040 15.4 14.0 11.8 11.0 1.4 6.1% IPSA 4,669 5,740 22.9% 27.1% 126,442 15.9 14.4 8.1 7.6 1.4 4.2%

Sources: Bloomberg, Company Reports and Credicorp Capital a Simple average, excluding Market Capitalization b Prices in local currencies

7 Colombia We stick with our Overweight in Colombia; we expect to gain more insight on the 2020E outlook in the upcoming 4Q19 conference calls

Market Color

In Jan-20, the COLCAP index had a negative month and slightly underperformed the MSCI Latam. The local index declined 2.3% and 6.2% in COP and USD terms, respectively. The MSCI Latam declined 5.7% (USD terms) amid a weak month for almost the entire region. It is important to note that oil prices fell sharply during the initial month of 2020 as the Brent reference fell 11.9%. This had a negative effect on Colombian equities. On the local front, we believe that investors remain focused on 4Q19 results and conference calls, which may provide a more complete outlook for 2020E. Despite the recent performance, we maintain our moderately positive view on Colombian equities with an overweight position relative to the rest of the Andean region. Our target for the COLCAP index stands at 1,710 points for 2020E, and our thesis for Colombian equities continues to rely mainly on strong economic activity in Colombia, an outperformance when compared to peers in the region and strong earnings momentum at banks. Finally, in Feb- 20, we will be particularly attentive to the upcoming reserves report of Ecopetrol; we expect a replacement ratio at or above 100%. This should definitely be a positive catalyst for the name and the whole market, in our view.

From a bottom up perspective (review of January), Avianca and GEB shone during the initial month of 2020. The local airline announced two key milestones: i) a fleet optimization plan that seeks to postpone the entrance of new aircraft with a significant reduction in the CAPEX plan and ii) additional funding from new investors worth USD 125 mn. Both of these announcements were well received by investors amid the ongoing transformation plan of the company. In the case of GEB, the announcement of a higher number of independent members in the new BoD seems to have been welcomed by investors. In addition, we believe that speculation amid a potential entrance on the MSCI index may have driven share price performance. On the negative side, Cementos Argos and Canacol were at the bottom of the COLCAP index during Jan-20. A weak outlook for Cementos Argos in 2020E along with a correction on the name after a positive Dec-19 explained share price performance. Regarding Canacol, we believe that investors anticipated a negative outflow due to the COLCAP index rebalancing, which took place at the end of the month.

Exito ended up being a surprise in the recent rebalancing process of the COLCAP index. Given the recent tender offer on the name in which +95% of shares were awarded, the market (including us) was anticipating a big outflow in the recent rebalancing process. In fact, our final estimate suggested an outflow of USD 21.3 mn. Despite the expectations, the block was not traded, and the ETF provider decided not to sell during the rebalancing process. Shares rose nearly 10% on that day, but volume stayed below USD 1 mn. Beyond the case of Exito, we highlight that preferred shares of Bancolombia saw the highest traded volume during the rebalancing process with nearly USD 20 mn. More importantly, shares corrected to below COP 45,000/share in the local market, which we believe was a new solid entry point for the name. Finally, we highlight that the market expects a new MSCI rebalancing process at the end of Feb-20; we will be particularly focused on any potential flow in GEB.

8 Macro / political developments

The Minister of Finance, Alberto Carrasquilla, presented the preliminary 2019 fiscal figures and the update of the 2020 Financial Plan. Overall, there were no major surprises vs the targets set in the 2019 Medium-Term Fiscal Framework (MTFF), and, in fact, we think that some announcements were favorable, at least for the short term. Importantly, the fiscal deficit of the Central Government (CG) stood at 2.5% of GDP in 2019 (2018: 3.1%), slightly above the official target of 2.4% and in line with our estimate. In addition, the CG managed to post its first primary surplus since 2012 (0.5% of GDP). For this year, the MoF has set the CG’s fiscal deficit target at 2.2% of GDP with the primary surplus reaching 0.6% of GDP. Notably, the MoF assumes that tax collection as a % of GDP will remain at the same level as 2019 (14.3% of GDP), even though most projections point towards a strong reduction amid the corporate tax cuts for roughly 1% of GDP approved in the 2018 tax reform.

Inflation came in way below expectations in Jan-20, easing concerns further.

The CPI rose just 0.42% m/m in Jan-20, way below our estimate and the market consensus forecast (0.61% and 0.57%, respectively). In fact, this was the lowest m/m figure for a month of January since 2013 (0.30% m/m). Thus, annual inflation slowed significantly, from 3.80% y/y in Dec-19 to 3.62% y/y, the lowest level since Jun-19 (3.42% y/y). This downside surprise is a significant relief as the upward trend observed during most of 2019 increased the likelihood of reaching levels above 4%, the ceiling of the BanRep’s target range. Pressures were modest across all CPI groups but were particularly soft in housing (+0.05% m/m), which has the highest weight in the basket (33.12%). More importantly, core measures retreated after persistent acceleration over the past several months, with ex-food falling -10bps m/m to 3.35% y/y, ex-food-and-energy - 3bps m/m to 3.37% y/y and services inflation -14bps m/m to 3.61% y/y, all close to the BanRep’s 3% target.

Inflation is expected to converge to levels closer to the 3% target this year as supply-side shocks that affected foodstuff prices in 2019 (e.g. a climate-related effect and VAT on sugary drinks) are expected to ease further in the coming months, and the incidence of the FX pass-through should moderate somewhat given the stabilization and slight appreciation of the COP recently. However, the latter is subject to a high degree of uncertainty due to the volatile external scenario. Conversely, offsetting pressures could be observed on the demand side as the output gap continues to narrow amid accelerating GDP growth. All-in, we expect the first factors to prevail over the moderate upside pressures, and thus we have a year-end inflation forecast of 3.4%.

This positive news on inflation significantly eases the upside risk on our view of a stable (at 4.25%) repo rate from the BanRep during the whole of 2020, especially considering the partial reversion of the upside trend of core inflation measures. We expect this data to further anchor medium- and long-term inflation expectations to the 3% target, leading to additional time to wait for the BanRep.

9 Equity strategy

We are sticking with our equity strategy for Colombia as the banking industry remains at the core of our view. We reiterate that our target for the COLCAP index stands at 1,710 points as we continue to be moderately optimistic about this year. Our thesis on Colombia continues to rely on three main themes: i) strong economic activity as we expect GDP growth of 3.2% in 2020E, ii) earnings momentum across banks; we expect double-digit growth on average for our sample of banks/financial institutions under our coverage in 2020E and iii) any potential special operation that may unlock further value and attract the interest of investors. The strong economic activity should continue to benefit from resilient investment amid a cut in corporate taxes and more visibility on the infrastructure front, while private consumption continues to be a key driver for economic activity as well.

Regarding trading multiples, we reiterate that the Colombian market continues to look attractive from a valuation standpoint. Our sample of the COLCAP index currently trades at 15.1x P/E forward and 7.0x EV/EBITDA forward, compared to a 3-year average of 19.1x and 8.1x, respectively. In fact, we highlight that the Colombian market currently trades near one standard deviation on a forward multiple basis. Despite the discount, we acknowledge that we continue to expect stronger delivery in key names of the local market (excluding banks).

It may sound boring and repetitive, but we are sticking with the banks as the core of our strategy. Bancolombia (BUY | T.P.: COP 48,800) and Davivienda (BUY | T.P.: COP 47,500) remain our top picks. The most recent monthly results for the industry (Nov-19) exhibited weaker results relative to the trend observed for most of 2019; that said, we emphasize that this was mostly related to additional provisions coming from Ruta del Sol 2 (RDS2), which was widely expected by market participants, in our view. Beyond these provision expenses, we highlight that annual NPL growth stayed in negative territory for the fourth consecutive month (at the end of Nov-19), which may signal a positive outlook ahead of 2020E. Beyond monthly results, we reiterate that our thesis for the banks remains in place due to: i) favorable trends in loan growth with accelerations in key segments such as consumer (some banks have shown loan growth of more than 30.0% y/y in recent months), ii) a positive comparison base ahead of 2020 in terms of cost of risk as the key corporate cases will be off the table by 2019E, iii) higher ROAE expectations for this year and iv) no major trouble in capital ratios ahead of Basel III implementation. Regarding valuation, banking shares in Colombia trade at 11.2x P/E 2020E on average, compared to a ~12x median from Andean peers; on a P/BV basis, Colombian banks trade around 1.5x P/BV 2020E, in line with peers. Despite tighter valuations when compared to the previous year, we continue to believe that Colombian banks deserve a higher valuation. The current outlook for the Colombian economy relative to peers in the region supports our thesis.

We remain neutral in key names in the index other than banks (Grupo Sura, Grupo Argos and Cementos Argos). We believe that these names share three main aspects that make us believe a significant rally is unlikely in 2020; these are: i) weak fundamentals and profitability levels, ii) lack of delivery in M&A history in terms of profitability and iii) high ownership by local investors, with pension funds close to the regulatory maximum levels and smaller players having increased their positions on the names after a sell-off during 2018; this makes it impossible to increase positions on these names, while creating an incentive to take profits periodically. Considering these issues, we believe that in the absence of better delivery from these names, foreign outflows should be limited while local appetite is ruffled.

10 Cement and construction is the sector we like the least as we do not see major investment opportunities in this sector. 2020 is expected to be a more challenging year, and neither Cemargos (HOLD | T.P.: COP 7,700) nor CLH (HOLD | T.P.: COP 5,00) offer attractive earnings momentum at this point with uncertainty for both in Central America and headwinds in Colombia. We expect weak 4Q19 results for both companies and a possible +100% dividend payout ratio for 2020E in the case of Cemargos. Regarding the Colombian cement/construction market, dispatches increased 4.2% y/y in 2019, in line with our forecast, while price increased 14.3%, way above our estimates. For 2020, we expect a mild deceleration in cement consumption as our forecast stands at 2%- 4%. We believe that this will be explained by a more challenging base for the infrastructure segment given the advances in 4G and district infrastructure projects during 2019 as the latter will not continue in 2020 (regional elections took place in 2019). In addition, we believe that housing will still be slow this year as inventories remain high and their rate of decrease has slowed down since May-19. Furthermore, there is a new competitor in the cement market that expects to have won a ~10% market share by 2020E year-end.

Regarding utilities, attention this month will be on the bids for Electricaribe, which will be executed on the 26th and 27th of this month. After a failed plan in 2018 from the government to sell the largest electric utility of distribution in the Caribbean region, this year interest for these assets comes from six parties. EPM, the largest utility vehicle in Colombia is willing to go for the Caribe Mar segment, which accounts for ~11% of the total market share, which would allow the public company to reach a total market share of ~34% in the national distribution market. Caribe Sol, which is the other half of Electricaribe, has not received any serious offers, which could result in it being managed by the local government.

GEB (HOLD | T.P.: COP 2,450) might not be willing to bid for Electricaribe. With disputes in the courts with its partner Enel, it seems both are not in the mood to bid for this asset through Codensa, their Dx vehicle in Colombia. Results expectations, a change in the BoD with higher ESG standards and possible speculation by the market that GEB will be included in the MSCI index have boosted the name to close to our expectations. We acknowledge that GEB’s financials should continue with decent growth, and we maintain a moderately optimistic view. That said, TGI contracts’ maturity and a lower regulatory discount rate expected prevents us from being more bullish on the name at current prices.

Regarding Celsia (UPERF | T.P.: COP 4,100), we believe that the Caoba vehicle, in partnership with Cubico Investments, will strengthen Celsia’s balance sheet, reducing its leverage for this year to ~2.8x Net Debt / EBITDA (currently around 3.0x). In addition, the company could devote more effort towards the solar and wind arms on the generation side. Despite recognizing that spot prices in Colombia for MW are at their peak, we continue to consider that in the long run spot prices should converge to levels below COP 150k/MWh. This may be supported by renewable entrance and increased capacity in the hydro mix. This prevents us from being positive on the name in the long run.

Turning to Oil & Gas, the regasification initiatives are heating up the sector in order to respond to the expected gas deficit in January of 2024, according to the Mines and Energy Planning Unit (UPME). The regulator is trying to incentivize key initiatives like bi- directional proposals in selected pipelines, while for 2024 the intention to deliver another FSRU (Floating Ship Regasification Unit) in Buenaventura remains. This translates into better local pricing given the fact that, according to UPME estimates, spot prices for imported gas should exit SPEC’s terminal at USD 3.0 to USD 6.0 per MMbtu above Henry Hub prices (HH: ~USD 1.9 MMbtu). This means, in the most optimistic scenario, that imported gas from the Cartagena regasification terminal will be equivalent

11 to local prices, giving space to local players like Canacol (BUY | T.P.: COP 15,900 / USD 5.0) to maneuver with their gas intermediaries. From the company perspective, CNEC results might not be as expected since production sales were on average 180 MMscfpd during the quarter as a result of the maturity of some contracts in late November and the late entrance of “take or pay” activities in December.

For Ecopetrol (HOLD | T.P.: COP 3,000 / USD 19.7), the scenario looks better than before. The reserves report should be delivered by late February, letting us bet on a +100% replacement ratio. Recall that the company might show, in addition to the 160 mmboe coming from the JV with Oxy, its acquisition of Chevron’s stake in Chuchupa and Ballena, the biggest gas wells in the Caribbean region. 2020 looks promising for Ecopetrol due to the recent bids in Colombia. It is worth noting that last year the National Hydrocarbon Agency released 31 new E&P areas in order to secure new liquid and gas resources in the national energetic matrix with the intention of boosting the sector. Ecopetrol should be well positioned to respond with their integrated portfolio. We expect to provide an update on the company in the upcoming weeks.

Given all the above, we reiterate that our top picks are Davivienda, Bancolombia, and Canacol.

P/E Forward (12-month rolling) EV/EBITDA Forward (12-month rolling)

28 11 26 24 10 22 9 20 18 15.1x 8 16 14 7 12 7.0x 10 6 Feb-17 Feb-18 Feb-19 Feb-20 Feb-17 Feb-18 Feb-19 Feb-20

Sources: Bloomberg, Company Reports and Credicorp Capital a Simple average, excluding Market Capitalization

12 Top Picks Colombia

Davivienda (BUY; T.P.: COP 47,500). We are maintaining Davivienda as one of our Top Picks as we continue to like the bank’s medium-term story. Our view is mainly explained by i) expected higher loan growth in Colombia compared to the industry average for both 2019E and 2020E (at least 150 bps higher and ~11.0% y/y in 2020E), ii) an estimated 15- bps decline in cost of risk next year (recall that both Electricaribe and RDS 2 should be off the table in 2020E), iii) a robust digital transformation plan (as of 3Q19, Davivienda’s product sales through digital channels accounted for 48% of total sales, compared to only 4.0% in 2Q18, iv) 23.1% y/y EPS growth in 2020E, v) a 100-bps ROAE expansion in 2020E (compared to 2019E) and vi) a still attractive valuation of roughly 1.5x P/BV 2020E. Finally, we highlight that Davivienda has not faced any corporate governance issues, which we believe has been a key driver for the stock, in contrast to other companies in our Colombian sample.

Bancolombia (BUY; T.P.: COP 48,800). In addition to similar trends in provision expenses as Davivienda, we believe that Bancolombia should also benefit from i) strong annual growth in the consumer segment in Colombia (over 20% y/y in 2019E and double- digit growth in 2020E), ii) digital penetration through key apps/platforms, such as Nequi and Ahorro a la Mano, and iii) improvement in efficiency ratios as we expect a cost to income ratio of 48.7% in 2020E, compared to 50.1% in 2018. Finally, we reiterate that we expect an 80-bps ROAE expansion to 13.2% this year (compared to year-end 2019E) Under this scenario, considering the improving macro picture in Colombia, we believe that Bancolombia continues to be an ideal vehicle to invest in the local market.

Canacol (BUY; T.P.: COP 15,900 / USD 5.0). Considering the projects coming from the Mines and Energy Planning Unit (UPME) that are intended to help meet national gas demand, Canacol should be a beneficiary of the low reserves the country faces before 2024, the year in which the delivery of the Buenaventura re-gas plant is expected. With exploration activity increasing in Colombia (targeting to drill 12 wells this year) and new appraisals in the Lower Valley in Magdalena, We consider Canacol as a solid player, who could continue to add gas reserves to their inventory and secure future cash flows with their “take or pay” business model. We are aware of companies challenges in order to close Medellín contracts, a development that requires a path to build a gas pipeline of 100 MMscfpd from Jobo to Medellín. However, with demand increasing +3% and local prices above Henry Hub + USD 3.0 per MMbtu, it seems that local prices continue to be competitive and below import parity cost. Recall that, according to UPME registers, the cost to import gas might be USD 3.0 to USD 6.0 MMbtu above the Henry Hub benchmark, meaning there could be a time at which import prices and local prices will converge. All in, we view the competition as an opportunity for Canacol as we expect the company to maintain a strong success rate (currently 83%), allowing the company secure its future inventory.

Colombia - Top Picks

Last Target Total Mkt. P/E FV/EBITDA P/BV Div Yield Price Price Upside Return (USD mn) 2019E 2020E 2019E 2020E LTM 2020E Sector Davivienda 45,800 47,500 3.7% 5.8% 6,154 14.1 11.5 nm nm 1.8 2.1% Banks Bancolombia 45,920 48,800 6.3% 8.9% 12,725 13.8 11.9 nm nm 1.7 2.6% Banks Canacol 10,900 15,900 45.9% 50.7% 584 18.0 5.5 5.4 3.6 2.6 4.8% Oil&gas Colombian Picks a 5.0% 7.4% 18,879 13.9 11.7 nm nm 1.7 2.4% COLCAP 1,645 1,710 3.9% 9.3% 91,142 12.3 16.1 8.4 8.1 1.5 5.4%

Sources: Bloomberg, Company Reports and Credicorp Capital a Simple average, excluding Market Capitalization

13 Peru New concerns on the external front, with no clear catalysts at home

Economic activity continued its lackluster performance in November, mainly due to tepid growth in non-primary sectors. Economic activity grew 1.9% y/y in Nov19, decelerating from its October performance (+2.1% y/y) and once again below market expectations (+2.4%, according to Bloomberg survey). On a sector by sector basis, Economic activity in primary sectors had their second-best performance of the year, mainly due to agriculture November failed to (2.1%), hydrocarbons (6.7%) and mining (3.5%, a 20-month high). On the other hand, the meet market fishing sector contracted 13.8%, and primary manufacturing fell 2.3%. Non-primary consensus sectors grew by just 1.8% y/y, the slowest pace since Apr17; we are mostly concerned expectations again, about the drop in both the construction sector and non-primary manufacturing (-3.7% and mainly due to non- -2.7% y/y, respectively). In the case of construction, its underperformance is explained by primary sectors. the slower physical advance of public works. However, according to the latest BCRP monthly survey on business expectations, business sentiment continued to improve moderately in January. Given that businesses are more confident that the economy will be in better shape three months from now, we cannot rule out an uptick in economic activity during 1Q20. With stimulus The positive impact from recent pro-growth measures could be offset by the next measures piling up, electoral cycle. As we have mentioned before, most of the urgency decrees enacted by we expect a recovery the government since Oct19 have focused on streamlining procedures in the public sector in public investment to accelerate the execution of stalled infrastructure projects. In addition, as soon as in in the up coming April, the Executive could sign the first Government-to-Government contract for a set of months. However, key infrastructure projects related to the reconstruction of the north of Peru, which could 2021 electoral noise mark an inflection point in the speed of public investment execution. However, with the could be a drag on new Congress set to be inaugurated in March, investors are becoming more aware that private investment in the 2021 electoral cycle will likely start in 3Q20 (a likely period for political parties to hold 2H20. their primary elections). Thus, the risk that political noise could slow down private investment persists and could offset more dynamic public investment in 2H20.

Uncertainty around the coronavirus outbreak could curb expectations on the External risks make external front. The outbreak adds to other concerns about global growth, such as the us cautious about deceleration of the Chinese economy, further progress on US-China negotiations and the the performance of limited room for monetary policy action in the largest economies. All in, local investors export-oriented remain cautious on the external front’s impact on the local economy and export-oriented sectors in 1H20. sectors in 1H20 as uncertainty lingers on the duration of negative market sentiment due to the coronavirus outbreak.

January’s parliamentary elections resulted in a mostly centrist Congress, but it is more fragmented than expected. Official results show that nine political parties will be A centrist, more represented in the 2020-2021 Congress (two of them with a clear left-wing orientation, fragmented with a combined 22 members out of a total of 130 for the full Congress, compared to a Congress could 20/130 proportion in the previous parliament). Most parties have a centrist, moderate behave more orientation in terms of economic policy, which underpins our belief that the current collaboratively with economic model and macroeconomic stability will be maintained. In addition, we believe the government on a that both the government and the newly elected Congress will prioritize the conclusion of range of issues. the judicial and political reforms, but there is a chance consensus will be tough to reach regarding key pending economic reforms (such as the labor reform). Finally, we expect to witness an overall collaborative relationship between the Executive and Congress this year, but the beginning of the 2021 electoral cycle later in 2020 could heighten noise again, depending on how political alliances evolve.

14 Peru Strategy

In January, the Lima Stock Exchange returned 5.30% in USD and 3.37% in PEN, pretty much in line with MSCI Latam Index’s performance. The local index was affected by lower base metal prices, which were driven down by the potential economic implications of the coronavirus outbreak.

We maintain our Underweight recommendation for Peruvian equities. The Congressional election results yielded a very fragmented Congress and increased the number of left-leaning representatives slightly. Thus, we believe that it will be challenging for the Executive to push forward with pending economic reforms, such as the labor reform, the simplification of the tax code or a more market-friendly mining law. However, We maintain our the Executive could take advantage of the fragmentation to influence the legislative Underweight agenda to push forward with the judicial and political reforms. On the international front, recommendation for base metals have rebounded somewhat but are still pressured by fears that the Peru as no clear coronavirus outbreak could negatively affect global growth. catalyst suggests a stronger recovery. January erased the gains seen in December. Most mining companies registered losses (all except for Minsur and Volcan). In particular, the local index was mainly driven downward by mining heavyweights Southern Copper and Buenaventura. Price declines were also seen in Credicorp, which is the heaviest company in the index with a representation of ~25%. Local equities suffered from institutional foreign investors’ selling pressure. We still like issuers with strong fundamentals exposed to domestic demand, such as IFS and InRetail, which are expected to post solid 4Q19 earnings results in the upcoming weeks. The brief volatility seen in Luz del Sur was explained by speculation due to the recent announcement from the Peruvian antitrust authority that it will take 30 additional working days to reach a decision on the takeover deal. However, we still believe the deal will go through without any major hassles.

Local stocks in our sample depreciated, led by mining companies. At 13.5x 12M forward P/E, companies under our coverage are trading at a ~15% discount against the two-year historical average (corrected for the significant losses in Buenaventura). Likewise, at 6.7x, the 12M forward EV/EBITDA is at a ~4% discount vs the five-year historical average.

On an ex-mining companies basis, the EV/EBITDA is trading at a ~14% premium and the P/E multiple at a ~7% premium vs their historical averages. Mining stocks On an ex-mining maintained their discount to their two-year multiple averages due to the lower base metal companies basis, the prices seen in January. local market is trading at a premium against its recent P/E Forward (12-month rolling) * FV/EBITDA Forward (12-month rolling) * history. 24 12

22 11 10 20 9 18 8 16 7 14 13.5x 6 6.7x 12 5 Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 Feb-20 Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 Feb-20 Source: Company Reports, Credicorp Capital, & Bloomberg *Mean in the chart considers the last 2 years.

15 Top Picks Peru

InRetail (BUY; T.P.: USD 46.70). We maintain our confidence in InRetail despite a We continue to see softening in domestic demand growth in the short term. Food Retail still has growth upside potential in opportunities from new formats Economax (cash & carry) and Mass (hard discounter), InRetail in the short which combined represent ~10% of Food Retail revenues. Also, drugstores should and medium terms as continue gaining market share (for instance, through Inkafarma Express in the traditional synergies from segment), and InRetail could continue achieving EBITDA margin expansion through vertical integration potential synergies from vertical integration in the Pharma division and from store and store maturation maturation. All in, InRetail’s strong positioning in the Peruvian market is essential to its are yet to be fully continuing to expand its market share and margins in the long term. realized. Ferreycorp (BUY; T.P.: PEN 2.85). We maintain Ferreycorp as a Top Pick as it is positioned to be one of the top performers in this mining investment upcycle. In 2019 and 2019 mining 2020, it will provide CAT machinery to Mina Justa for USD 100mn. Additionally, it will also investment deliver a fleet of CAT trucks of 320 MT and other types of equipment for the Quellaveco registered a 24.5% mining project, in addition to providing specialized support to the project. The total value of y/y increase, led by the contract is USD 500mn, and the biggest cash inflow will take place in 2021 as major outlays on greenfield machinery deliveries are scheduled to take place. In addition, we expect the Spare Parts projects such as & Services (SP&S) segment to continue to grow, albeit at a more moderate rate, providing Mina Justa, more stability to the company’s overall revenues. It is worth noting that the big mining Quellaveco and machinery deliveries to come should foster future SP&S growth. These positive factors Quecher Main. should keep driving results forward for the next couple of years, and we believe this impact has not been priced in yet, given the current price levels of the company’s stock. .

Peru - Top Picks

Last Target Total Mkt. P/E FV/EBITDA P/BV Div Yield Price Price Upside Return (USD mn) 2019E 2020E 2019E 2020E LTM 2020E Sectors InRetail 39.00 46.72 19.8% 20.3% 4,009 25.4 19.9 10.3 9.1 3.1 0.5% Retail Ferreycorp 2.12 2.85 34.4% 41.0% 623 7.6 8.0 5.9 6.0 1.0 6.6% Materials Peruvian Picks a 27.1% 30.6% 4,633 16.5 13.9 8.1 7.6 2.0 3.5% S&P/BVL 20,382 22,910 12.4% 15.2% 38,140 22.6 15.6 8.0 6.9 nm 2.8% Sources: Bloomberg, Company Reports and Credicorp Capital a Simple average, excluding Market Capitalization

16 Valuation Summary

February 2020

17 Chile

ADTV P/E FV/EBITDA P/BV Div Yield. ROAE ROAA Company Sector Px Last Px Target Rating Mkt. Cap Local ADR 2019E 2020E 2019E 2020E LTM 2020E 2019E 2020E 2019E 2020E AESGener Utilities 146 175 HOLD 1,570 1.6 1.9 6.6 5.7 5.6 0.6 13.3% 9.7% 7.5% 3.4% 2.7% Aguas-A Utilities 316 390 UPERF 2,420 3.5 14.6 14.8 9.4 9.2 3.0 6.9% 20.5% 20.6% 6.7% 6.6% Andina-B Food & Beverages 2,060 2,760 BUY 2,366 2.7 0.2 15.9 15.7 7.9 7.6 2.4 5.2% 14.1% 13.8% 5.5% 5.4% Antarchile Conglomerates 7,623 9,400 HOLD 4,470 0.5 13.2 13.6 7.6 7.1 0.6 3.8% 5.0% 4.7% 1.4% 1.3% Banks 80 90 HOLD 10,410 12.7 2.5 14.5 14.1 nm nm 2.4 3.5% 16.5% 16.0% 1.5% 1.4% Banco Santander Banks 41 49 HOLD 9,915 7.9 9.2 14.3 13.8 nm nm 2.3 4.2% 16.1% 15.8% 1.2% 1.2% BCI Banks 36,000 39,700 HOLD 6,551 3.9 13.1 13.7 nm nm 1.4 2.6% 10.6% 9.8% 0.9% 0.8% Besalco Cement & Construction 394 650 BUY 292 0.3 16.1 12.9 8.9 7.1 1.2 4.3% 7.5% 9.0% 2.0% 2.4% CAP Mining 5,000 7,500 HOLD 960 3.6 7.9 5.6 5.6 4.6 0.5 6.4% 6.0% 8.5% 2.3% 3.1% CCU Food & Beverages 7,160 8,840 UPERF 3,399 3.3 6.5 18.4 16.8 8.6 8.4 2.5 3.3% 11.4% 12.4% 6.0% 6.4% Cencosud Retail 1,021 1,400 BUY 3,755 6.6 8.2 10.2 8.4 9.4 nm 4.8% 8.9% 7.6% 3.4% 2.7% CMPC Pulp & Paper 1,928 2,100 BUY 6,193 6.4 136.4 95.6 8.9 8.7 0.7 0.7% 0.6% 0.8% 0.3% 0.4% Colbun Utilities 118 160 BUY 2,659 2.5 9.2 9.7 5.3 5.6 0.7 10.6% 7.0% 7.7% 3.7% 4.1% Concha y Toro Food & Beverages 1,410 1,620 HOLD 1,353 1.3 21.1 18.4 13.8 12.1 1.8 2.8% 8.6% 9.4% 4.3% 4.7% Copec Pulp & Paper 7,423 8,000 BUY 12,398 6.2 22.6 22.4 9.3 8.7 1.1 2.2% 5.1% 5.0% 2.3% 2.3% Embonor-B Food & Beverages 1,290 1,810 BUY 869 0.5 14.2 13.5 7.9 7.4 2.0 5.3% 12.2% 12.4% 5.8% 5.7% Enel Chile Utilities 78 74 HOLD 6,932 6.5 1.8 18.5 13.3 6.9 6.2 1.4 5.8% 9.1% 10.5% 4.1% 4.7% Enel Generacion Chile Utilities 351 400 UPERF 3,695 0.4 11.2 7.7 5.2 5.1 6.3 10.0% 11.2% 16.5% 6.0% 8.8% Engie Chile Utilities 1,144 1,450 BUY 1,548 1.8 8.7 7.7 4.5 4.6 0.8 11.6% 8.5% 9.2% 5.1% 5.6% Telecom & IT 5,122 7,450 BUY 1,988 2.1 38.5 25.1 6.6 6.0 1.2 1.0% 2.9% 4.3% 1.0% 1.5% Falabella Retail 3,198 4,780 HOLD 10,309 13.5 20.8 18.2 11.2 10.4 1.8 1.9% 7.6% 8.3% 2.4% 2.6% Hites Retail 182 UR UR 88 0.1 nm nmnm nm nm nm nm nm nm nm nm ILC Conglomerates 6,935 14,600 BUY 891 1.1 6.4 5.8 nm nm 1.0 7.1% nm nm nm nm Itau Corpbanca Banks 3.8 4.6 UPERF 2,509 2.0 0.1 15.3 13.6 nm nm 0.6 2.0% 3.8% 4.1% 0.4% 0.4% Latam Airlines Transport 7,011 7,110 HOLD 5,463 6.2 187.2 32.3 6.9 6.1 1.8 0.3% 0.9% 5.3% 0.1% 0.8% Materials 28.2 38.0 UPERF 284 0.2 27.2 12.7 11.3 11.4 0.4 3.3% 1.3% 2.8% 0.8% 1.9% Parque Arauco Real Estate 1,855 2,415 BUY 2,159 2.4 16.4 16.0 17.3 16.2 1.7 4.0% 10.4% 9.9% 4.1% 3.9% Quiñenco Conglomerates 1,393 2,170 HOLD 2,977 0.8 8.3 8.0 nm nm 0.7 6.1% nm nm nm nm Ripley Retail 365 613 BUY 908 0.9 7.0 13.4 9.3 9.0 0.7 5.0% 9.8% 5.0% 3.1% 1.5% Salfacorp Cement & Construction 429.4 UR UR 248 0.5 nm nmnm nm nm nm nm nm nm nm nm SK Industrial 995 1,400 HOLD 1,374 0.9 11.3 10.2 7.5 7.0 1.0 6.5% 8.6% 8.8% 3.1% 3.2% SM SAAM Transport 62 76 BUY 779 0.4 14.3 12.9 5.6 4.9 1.0 4.3% 7.0% 7.5% 3.7% 3.8% SMU Retail 136 213 HOLD 1,009 0.6 23.7 19.6 8.6 8.4 1.1 1.3% 4.6% 5.4% 1.7% 2.0% Sonda Telecom & IT 610 1,080 HOLD 683 1.1 19.7 14.7 7.4 6.1 1.1 2.8% 5.3% 6.8% 2.8% 3.5% SQM-B Materials 23,451 22,200 BUY 7,571 11.2 25.3 26.0 18.9 12.1 9.8 3.6 3.8% 15.0% 20.6% 7.2% 9.7% Chile Sample 4,675 5,740 127,299 132.3 15.9 14.4 8.1 7.6 1.4 4.1% 8.6% 9.2% 1.8% 1.9%

Source: Company Reports, Credicorp Capital, & Bloomberg

18 Colombia

ADTV P/E FV/EBITDA P/BV Div Yield. ROAE ROAA Company Sector Px Last Px Target Rating Mkt. Cap Local ADR 2019E 2020E 2019E 2020E LTM 2020E 2019E 2020E 2019E 2020E Avianca Transport 2,040 1,000 UPERF 605 0.3 0.6 -1.4 293.7 8.5 8.1 0.9 0.0% -46.5% 0.3% -6.3% 0.0% Bancolombia Banks 46,980 48,800 BUY 12,955 6.2 14.8 14.1 12.2 nm nm 1.8 2.6% 12.4% 13.2% 1.4% 1.5% BVC Financial 11,320 14,000 BUY 204 0.1 15.8 14.4 8.1 7.4 1.5 5.9% 9.0% 9.6% 7.0% 7.3% Canacol Oil&gas 11,220 15,900 BUY 601 0.4 18.5 5.6 5.5 3.7 2.7 4.7% 15.1% 40.9% 4.4% 13.2% Celsia Utilities 4,520 4,100 UPERF 1,438 0.3 21.5 21.9 8.0 7.7 1.1 3.3% 5.1% 5.0% 2.0% 1.8% Cemargos Cement & Construction 6,530 7,700 HOLD 2,552 2.8 52.8 74.3 9.6 9.1 1.2 3.9% 2.1% 1.6% 0.9% 0.7% CLH Cement & Construction 4,245 5,000 HOLD 730 0.3 16.5 9.7 7.2 6.3 0.5 0.0% 2.8% 4.5% 1.4% 2.3% Corficolombiana Conglomerates 32,800 28,800 HOLD 2,895 0.7 7.1 7.0 nm nm 1.2 1.7% 17.6% 15.4% 4.1% 3.7% Davivienda Banks 46,720 47,500 BUY 6,276 1.4 14.4 11.7 nm nm 1.8 2.1% 12.3% 13.7% 1.3% 1.4% Ecopetrol Oil&Gas 3,190 3,000 HOLD 39,011 7.4 12.4 10.3 12.5 5.2 5.6 2.4 7.6% 21.5% 17.0% 9.6% 7.5% GEB Utilities 2,425 2,450 HOLD 6,622 1.3 11.5 11.4 8.3 8.0 33.5 6.5% 15.0% 14.5% 7.4% 7.0% Grupo Argos Conglomerates 18,300 17,000 HOLD 4,334 1.6 23.8 17.7 9.7 9.1 0.9 2.0% 4.0% 5.2% 1.4% 1.8% Grupo Aval Banks 1,460 1,430 HOLD 9,608 1.8 1.1 11.4 10.4 nm nm 1.8 4.1% 15.6% 15.9% 1.1% 1.1% Grupo Sura Conglomerates 32,920 35,300 HOLD 5,544 2.6 11.4 9.9 nm nm 0.8 1.8% 6.7% 7.3% 2.4% 2.8% Nutresa Food & Beverages 25,000 30,500 BUY 3,421 1.2 14.5 14.0 8.4 7.9 1.4 3.0% 6.6% 6.6% 3.9% 3.8% Colombia Sample 1,656 1,710 91,557 29.0 12.3 16.1 8.4 8.1 1.5 5.4% 11.6% 12.0% 2.3% 2.4%

Source: Company Reports, Credicorp Capital, & Bloomberg

19 Peru

ADTV P/E FV/EBITDA P/BV Div Yield. ROAE ROAA Company Sector Px Last Px Target Rating Mkt. Cap Local ADR 2019E 2020E 2019E 2020E LTM 2020E 2019E 2020E 2019E 2020E Aceros Arequipa Cement & Construction 0.93 0.90 BUY 364 0.1 7.7 7.2 4.2 3.5 0.6 7.4% 7.8% 8.1% 3.9% 4.0% Alicorp Food & Beverages 9.15 12.10 BUY 2,320 0.7 17.1 13.1 10.1 8.6 2.5 2.9% 13.6% 16.3% 4.6% 5.4% Buenaventura Mining 12.89 17.80 HOLD 3,737 17.8 38.8 19.9 15.7 9.8 1.3 0.2% 3.4% 6.3% 2.3% 4.2% Cementos Pacasmayo Cement & Construction 6.18 7.20 HOLD 784 0.3 0.0 19.9 17.5 9.4 8.7 1.6 6.0% 9.1% 10.4% 4.6% 5.2% Cerro Verde Mining 19.01 24.00 BUY 6,655 0.1 14.6 12.3 5.0 4.6 1.3 3.3% 8.7% 9.8% 6.0% 7.0% Enel Distribucion Peru Utilities 6.76 7.20 HOLD 1,284 0.1 10.0 10.9 7.4 6.9 nm 4.0% 18.7% 15.2% 9.2% 7.8% Enel Generacion Peru Utilities 2.39 2.88 HOLD 2,019 0.0 9.9 9.9 5.8 5.8 nm 4.9% 20.9% 18.2% 14.2% 12.9% Engie Peru Utilities 7.80 8.10 HOLD 1,396 0.2 12.7 13.1 7.3 7.4 1.3 5.5% 10.0% 9.6% 5.0% 4.9% Ferreycorp Materials 2.11 2.85 BUY 613 0.4 7.5 7.9 5.9 6.0 1.0 6.6% 12.5% 11.4% 4.8% 4.2% Graña y Montero Cement & Construction 1.85 2.30 HOLD 480 0.2 0.3 15.5 15.7 5.0 5.0 0.8 0.0% 4.6% 4.1% 1.4% 1.4% IFS Banks 42.45 50.53 BUY 4,901 2.0 12.0 11.4 nm nm 2.2 4.2% 18.2% 17.1% 2.0% 1.9% InRetail Retail 38.00 46.72 BUY 3,907 2.1 25.1 19.6 10.2 9.1 3.1 0.5% 11.9% 13.6% 3.6% 4.2% Luz del Sur Utilities 26.00 17.52 BUY 3,767 0.5 21.0 21.0 14.6 14.0 nm 3.8% 20.8% 18.8% 9.8% 9.2% Minsur Mining 1.65 2.00 BUY 1,415 0.2 18.2 16.9 8.6 7.6 1.1 0.0% 6.0% 6.2% 2.5% 2.4% Nexa Resources Mining 8.06 12.32 BUY 1,075 1.1 1.1 26.6 7.6 4.8 3.8 0.4 3.0% 1.6% 5.6% 0.7% 2.5% Unacem Cement & Construction 1.99 3.10 BUY 1,076 0.5 9.7 9.0 6.3 5.8 0.9 2.6% 8.7% 8.7% 3.6% 3.8% Volcan Mining 0.54 0.60 HOLD 2,084 0.3 15.2 11.6 9.8 9.6 3.2 1.1% 5.3% 6.9% 1.6% 2.1% Peru Sample 20,394 22,910 37,876 25.6 22.7 15.6 8.0 6.9 nm 2.9% 11.5% 11.7% 3.9% 5.2%

Source: Company Reports, Credicorp Capital, & Bloomberg

20 Economic Forecasts

February 2020

21 Economic Forecasts

CHILE National Accounts (YoY) 2015 2016 2017 2018 2019F 2020F Current GDP (USDmm) 244,417 250,266 277,184 299,148 283,565 274,205 GDP (%) 2.3 1.3 1.5 4.0 1.1 1.2 Domestic Demand (% v ar.) 2.5 1.3 3.1 4.7 0.8 -0.3 Total Consumption (% v ar.) 2.6 2.9 2.7 3.7 1.6 1.2 CPI 4.4 2.7 2.3 2.6 3.0 3.3 Reference rate (end of y ear) 3.50 3.50 2.50 2.75 1.75 1.50 Ex change rate (end of y ear) 709 667 615 696 752 750 Ex change rate (av g.) 655 677 649 640 703 760 Fiscal Balance (% GDP) -2.2 -2.7 -2.8 -1.7 -2.7 -4.5 Foreign Reserves (USDmm) 38,643 40,494 38,983 39,861 36,025 36,000

Source: INE, BCCh, Dipres & Credicorp Capital Estimates

PERU National Accounts (YoY) 2015 2016 2017 2018 2019F 2020F Current GDP (USDmm) 191,517 194,745 214,332 225,259 227,767 239,708 GDP (%) 3.3 4.0 2.5 4.0 2.3 3.0 Domestic Demand (% v ar.) 2.9 1.1 1.4 4.3 2.6 3.0 Total Consumption (% v ar.) 4.9 2.8 2.2 3.6 3.0 3.0 CPI 4.4 3.2 1.4 2.2 1.9 2.2 Ov ernight interest rate (end of y ear) 3.75 4.25 3.25 2.75 2.25 2.00 Ex change rate (end of y ear) 3.41 3.36 3.24 3.37 3.32 3.35-3.40 Ex change rate (av g.) 3.19 3.38 3.26 3.29 3.34 3.35-3.40 Fiscal Balance (% GDP) -2.1 -2.6 -3.1 -2.5 -1.6 -1.9 Foreign Reserves (USDmm) 61,485 61,686 63,621 60,121 68,800 69,000

Source: INEI, BCR & Credicorp Capital Estimates

COLOMBIA National Accounts (YoY) 2015 2016 2017 2018 2019F 2020F Current GDP (USDmm) 293,321 283,148 314,458 330,083 319,871 339,262 GDP (%) 3.0 2.1 1.4 2.7 3.3 3.2 Domestic Demand (% v ar.) 2.4 1.2 1.2 3.8 4.8 3.1 Total Consumption (% v ar.) 3.4 1.6 2.4 3.9 4.4 3.1 CPI 6.8 5.8 4.1 3.2 3.8 3.4 Ov ernight interest rate (end of y ear) 5.75 7.50 4.75 4.25 4.25 4.25 Ex change rate (end of y ear) 3,175 3,002 2,984 3,249 3,297 3,150 Ex change rate (av g.) 2,760 3,051 2,951 2,957 3,283 3,300 Fiscal Balance (% GDP) -3.0 -4.0 -3.6 -3.1 -2.5 -2.4 Foreign Reserves (USDmm) 46,741 46,683 47,637 48,402 53,100 54,000

Source: DANE, BanRep, Bloomberg & Credicorp Capital Estimates

22 Important Disclosures

This research report was prepared by Credicorp Capital Peru S.A and/or Credicorp Capital Colombia Sociedad Comisionista de Bolsa and/or Credicorp Capital S.A. Corredores de Bolsa, companies authorized to engage in securities activities in Peru, Colombia and Chile, respectively and indirect subsidiaries of Credicorp Capital Ltd. (jointly referred to as “Credicorp Capital”). None of the companies jointly referred to as Credicorp Capital are registered as broker-dealers in the United States and, therefore, they are not subject to U.S. rules regarding the preparation of research reports and the independence of research analysts. This research report is provided for distribution only to “major U.S. institutional investors” in reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any U.S. recipient of this research report wishing to effect any transaction to buy or sell securities or related financial instruments based on the information provided in this research report can do so only through Credicorp Capital Securities Inc., a registered broker-dealer in the United States. Under no circumstances may a U.S. recipient of this research report effect any transaction to buy or sell securities or related financial instruments directly through Credicorp Capital. CCSI or any of its representatives are not involved in any way in the preparation, development, or supervision of the research report and does not have any influence whatsoever over the research content. Any analyst whose name appears on this research report is not registered or qualified as a research analyst with the Financial Industry Regulatory Authority (“FINRA”) and is not a registered representative of Credicorp Capital Securities Inc. and, therefore, is not subject to applicable restrictions under FINRA Rules on communications with a subject company, public appearances and trading securities held by a research analyst account.

A. Analyst Disclosures The functional job title of the person(s) responsible for the recommendations contained in this report is Equity Research Analyst unless otherwise stated on the cover.

Regulation AC - Analyst Certification: Each Equity Research Analyst listed on the front-page of this report is principally responsible for the preparation and content of all or any identified portion of this research report and hereby certifies that with respect to each issuer or security or any identified portion of the report with respect to an issuer or security that the Equity Research Analyst covers in this research report, all of the views expressed in this research report accurately reflect their personal views about those issuer(s) or securities. Each Equity Research Analyst also certifies that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation(s) or view(s) expressed by that Equity Research Analyst in this research report. Each Equity Research Analyst certifies that he or she is acting independently and impartially from the referenced company/shareholders, directors and is not affected by any current or potential conflict of interest that may arise from any of the companies’ activities. Analyst Compensation: The research analyst(s) primarily responsible for the preparation of the content of this research report attest(s) that no part of his or her compensation was, is or will be, directly or indirectly, related to the specific recommendations that he or she expressed in the research report. The equity research analysts responsible for the preparation of this report receive compensation based upon various factors, including the quality and accuracy of research, client feedback, competitive factors, and overall firm revenues. Registration of non-US Analysts: Unless otherwise noted, the non-US analysts listed on the front of this report are employees of one of the companies jointly referred as Credicorp Capital, which are non-US affiliates of Credicorp Capital Securities Inc., a SEC registered and FINRA member broker-dealer. Equity Research Analysts employed by the companies jointly referred as Credicorp Capital, are not registered/ qualified as research analysts under FINRA/NYSE rules, are not registered representatives of Credicorp Capital Securities Inc. and may not be subject to NASD Rule 2711 and NYSE Rule 472 restrictions on communications with covered companies, public appearances, and trading securities held by a research analyst account. Please refer to www.credicorpcapital.com for further information relating to research and conflict of interest management.

23 B. Ownership and Material Conflicts of Interest

Other significant financial interests

Credicorp Capital Securities Inc. or its affiliates ´beneficially own´ securities issued by the companies referenced in this report according to the following table:

Type of instruments Equal or less than USD 50,000 Equal or less than USD 100,000 Equal or less than USD 500,000 More than USD 1,000,000

Other equity securities - Minsur - Banco de Chile, BCI,Cencosud, Colbun, CMPC, ECL, Falabella, Itaucorp, Ripley, SQM, PFBcolom, Debt securities Cemargos, IFS Davivienda Ecopetrol, PFAVAL, GEB, Alicorc1, Cpacasc1, Endispc1, Engepec1, Engiec1, Inretc1, Lusurc1, Minsuri1, Unacemc1, volcabc1 Deriv ativ es on equity /debt PFCOLOM, CNEC, CLH, Cemargos, Ecopetrol, Grupo Argos, Celsia securities CORFICOLCF Grupo Aval, Grupo Sura

The research analyst(s) primarily responsible for the preparation of the content of this research report or their household members ´beneficially own´ securities issued by the companies referenced in this report according to the following table:

Type of instruments Equal or less than USD 10,000 Equal or less than USD 50,000 Equal or less than USD 500,000 Equal or less than USD 1,000,000 Entel, Falabella, Celsia, ISA, Canacol, Equity securities CMPC, Santander,SQM, Luz del sur, Copec, ECL, EEB. Enel Gx Cemargos, , Enel Chile, Ecopetrol Debt securities - - - - Derivatives on equity/debt - - - - securities

C. Compensation and Investment Banking Activities Credicorp Capital Securities Inc. or its affiliates have managed or co-managed a public offering of securities, in the past 12 months, for the following company(ies):Hites, ILC, LTM, SMU, PFDAVVNDA, CORFICOLCF, PFAVAL, ALICORC1, ENGIEC1, LUSURC1 Credicorp Capital Securities Inc. or its affiliates currently have or had, within the past 12 months, the following company(ies) as investment banking client(s): Bsantander, Hites, ECL,ILC, LTM, SMU, SMSAAM, PFDAVVNDA, CORFICOLCF, PFAVAL, ALICORC1, CPACASC1, BVN, CORAREI1, ENGIEC1, FERREYC1, GRAMONC1, INRETC1, IFS, LUSURC1, VOLCABC1 Credicorp Capital Securities Inc. or its affiliates also have received compensation, within the past 12 months, for investment banking services from the following company(ies):Bsantander, Hites, ECL,ILC, LTM, SMU, SMSAAM, PFDAVVNDA, CORFICOLCF, PFAVAL, ALICORC1, CPACASC1, BVN, CORAREI1, ENGIEC1, FERREYC1, GRAMONC1, INRETC1, IFS, LUSURC1, VOLCABC1 Credicorp Capital Securities Inc. or its affiliates also expect to receive or intend to seek compensation, in the next 3 months, for investment banking services from the following company (ies):Bsantander, Hites, ECL,ILC, LTM, SMU, SMSAAM, PFDAVVNDA, CORFICOLCF, PFAVAL, ALICORC1, CPACASC1, BVN, CORAREI1, ENGIEC1, FERREYC1, GRAMONC1, INRETC1, IFS, LUSURC1, VOLCABC1

D. Other Compensation and Non-Investment Banking Activities

Credicorp Capital Securities Inc. or its affiliates currently provide or have provided, within the past 12 months, non-investment-banking securities-related services to the following company(ies):Banco de Chile, BCI,Santander, Hites, ILC, ITAUCORP, LTM, SMU. Credicorp Capital Securities Inc. or its affiliates also have received compensation, within the past 12 months, for non-investment-banking securities-related services from the following company(ies):Banco de Chile, BCI,Santander, Hites, ILC, ITAUCORP, LTM, SMU

24 E. Market Making Cedicorp Capital Securities Inc. or its affiliates act as market maker in the following company(ies): Besalco, Enjoy, Security, Masisa, Quiñenco, Ripley, BVC, GEB, Alicorc1, Cpacasc1, Ferreyc1 F. Rating System Stock ratings are based on the analyst’s expectation of the stock’s total return during the twelve to eighteen months following assignment of the rating. This view is based on the target price, set as described below, and on the analyst’s opinion, general market conditions and economic developments. Buy: Expected returns of 5 percentage points or more in excess over the expected return of the local index, over the next 12-18 months. Hold: Expected returns of +/- 5% in excess/below the expected return of the local index over the next 12-18 months. Underperform: Expected to underperform the local index by 5 percentage points or more over the next 12-18 months. Under Review: Company coverage is under review. The IPSA, COLCAP and IGBVL indexes are the selective equity indexes calculated by the Bolsa de Comercio de , the Bolsa de Valores de Colombia, and the Bolsa de Valores de Lima, respectively. In making a recommendation, the analyst compares the target price with the actual share price, and compares the resulting expected return for the IPSA, the COLCAP, and/or the SPBVL indexes, as estimated by Credicorp Capital S.A. Corredores de Bolsa, Credicorp Capital Colombia Sociedad Comisionista de Bolsa, and/or CredicorpCapital Peru S.A, and then makes a recommendation derived from the difference in upside potential between the shares and the respective index. G. Distribution of Ratings

Buy Hold Underperform Restricted / UR

Companies covered with this rating 39% 44% 11% 6%

Compensation for investment banking 36% 25% 25% 0% services in the past 12 months*

*Percentage of investment banking clients in each rating category.

H. Price Target Unless otherwise stated in the text of this report, target prices in this report are based on either a discounted cash flow valuation or comparison of valuation ratios with companies seen by the analyst as comparable or a combination of the two methods. The result of this fundamental valuation is adjusted to reflect the analyst’s views on the likely course of investor sentiment. Whichever valuation method is used there is a significant risk that the target price will not be achieved within the expected timeframe. Risk factors include unforeseen changes in competitive pressures or in the level of demand for the company’s products. Such demand variations may result from changes in technology, in the overall level of economic activity or, in some cases, in fashion. Valuations may also be affected by changes in taxation, in exchange rates and, in certain industries, in regulations. Investment in overseas markets and instruments such as ADRs can result in increased risk from factors such as exchange rates, exchange controls, taxation, and political and social conditions. This discussion of valuation methods and risk factors is not comprehensive – further information is available upon request.

25 II.ADDITIONAL DISCLOSURES

This product is not for retail clients or private individuals.

The information contained in this publication was obtained from various publicly available sources believed to be reliable, but has not been independently verified by the companies jointly referred as Credicorp Capital, therefore they do not warrant the completeness or accuracy of such information and does not accept any liability with respect to the accuracy or completeness of such information, except to the extent required by applicable law. This publication is a brief summary and does not purport to contain all available information on the subjects covered. Further information may be available on request. This report may not be reproduced for further publication unless the source is quoted. This publication is for information purposes only and shall not be construed as an offer or solicitation for the subscription or purchase or sale of any securities, or as an invitation, inducement or intermediation for the sale, subscription or purchase of any securities, or for engaging in any other transaction. This publication is not for private individuals.

Any opinions, projections, forecasts or estimates in this report are those of the author only, who has acted with a high degree of expertise. They reflect only the current views of the author at the date of this report and are subject to change without notice. The companies jointly referred to as Credicorp Capital have no obligation to update, modify or amend this publication or to otherwise notify a reader or recipient of this publication in the event that any matter, opinion, projection, forecast or estimate contained herein, changes or subsequently becomes inaccurate, or if research on the subject company is withdrawn. The analysis, opinions, projections, forecasts and estimates expressed in this report were in no way affected or influenced by the issuer. The author of this publication benefits financially from the overall success of Credicorp Capital. The investments referred to in this publication may not be suitable for all recipients. Recipients are urged to base their investment decisions upon their own appropriate investigations that they deem necessary. Any loss or other consequence arising from the use of the material contained in this publication shall be the sole and exclusive responsibility of the investor and Credicorp Capital accepts no liability for any such loss or consequence. In the event of any doubt about any investment, recipients should contact their own investment, legal and/or tax advisers to seek advice regarding the appropriateness of investing. Some of the investments mentioned in this publication may not be readily liquid investments. Consequently it may be difficult to sell or realize such investments. The past is not necessarily a guide to future performance of an investment. The value of investments and the income derived from them may fall as well as rise and investors may not get back the amount invested. Some investments discussed in this publication may have a high level of volatility. High volatility investments may experience sudden and large falls in their value which may cause losses. International investing includes risks related to political and economic uncertainties of foreign countries, as well as currency risk.

To the extent permitted by applicable law, no liability whatsoever is accepted for any direct or consequential loss, damages, costs or prejudices whatsoever arising from the use of this publication or its contents.

This report may not be independent of Credicorp Capital’s proprietary interests. Credicorp Capital trades the securities covered in this report for its own account and on a discretionary basis on behalf of certain clients. Such trading interests may be contrary to the recommendation(s) offered in this report

Credicorp Capital (and its affiliates) has implemented written procedures designed to identify and manage potential conflicts of interest that arise in connection with its research business, which are available upon request. The Credicorp Capital research analysts and other staff involved in issuing and disseminating research reports operate independently of Credicorp Capital’s Investment Banking business. Information barriers and procedures are in place between the research analysts and staff involved in securities trading for the account of Credicorp Capital or clients to ensure that price sensitive information is handled according to applicable laws and regulations.

26 Credicorp Capital Securities Inc., is a wholly owned subsidiary of Credicorp Capital Ltd.

Nothing herein excludes or restricts any duty or liability to a customer that Credicorp Capital Securities Inc. have under applicable law. Investment products provided by or through Credicorp Capital Securities Inc. are not insured by the Federal Deposit Insurance Corporation and are not deposits or other obligations of any insured depository institution, may lose value and are not guaranteed by the entity that published the research as disclosed on the front page and are not guaranteed by Credicorp Capital Securities Inc.

Investing in non-U.S. Securities may entail certain risks. The securities referred to in this report and non-U.S. issuers may not be registered under the U.S. Securities Act of 1933, as amended, and the issuer of such securities may not be subject to U.S. reporting and/or other requirements. Rule 144A securities may be offered or sold only to persons in the U.S. who are Qualified Institutional Buyers within the meaning of Rule 144A under the Securities Act. The information available about non-U.S. companies may be limited, and non-U.S. companies are generally not subject to the same uniform auditing and reporting standards as U.S. companies. Securities of some non-U.S. companies may not be as liquid as securities of comparable U.S. companies. Securities discussed herein may be rated below investment grade and should therefore only be considered for inclusion in accounts qualified for speculative investment.

Analysts employed by one of the companies jointly referred to as Credicorp Capital, all of which are non-U.S. broker-dealers, are not required to take the FINRA analyst exam. The information contained in this report is intended solely for certain "major U.S. institutional investors" and may not be used or relied upon by any other person for any purpose. Such information is provided for informational purposes only and does not constitute a solicitation to buy or an offer to sell any securities under the Securities Act of 1933, as amended, or under any other U.S. federal or state securities laws, rules or regulations. The investment opportunities discussed in this report may be unsuitable for certain investors depending on their specific investment objectives, risk tolerance and financial position.

In jurisdictions where Credicorp Capital Securities Inc. is not registered or licensed to trade in securities, or other financial products, transactions may be executed only in accordance with applicable law and legislation, which may vary from jurisdiction to jurisdiction and which may require that a transaction be made in accordance with applicable exemptions from registration or licensing requirements.

The information in this publication is based on sources believed to be reliable, but Credicorp Capital Securities Inc. does not make any representation with respect to its completeness or accuracy. All opinions expressed herein reflect the author's judgment at the original time of publication, without regard to the date on which you may receive such information, and are subject to change without notice.

Credicorp Capital Securities Inc. or its affiliates may have issued other reports that are inconsistent with, and reach different conclusions from, the information presented in this report. These publications reflect the different assumptions, views and analytical methods of the analysts who prepared them. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied, is provided in relation to future performance.

Credicorp Capital Securities Inc. and any company affiliated with it may, with respect to any securities discussed herein: (a) take a long or short position and buy or sell such securities; (b) act as investment and/or commercial bankers for issuers of such securities; (c) act as market makers for such securities; (d) serve on the board of any issuer of such securities; and (e) act as paid consultant or advisor to any issuer. The information contained herein may include forward-looking statements within the meaning of U.S. federal securities laws that are subject to risks and uncertainties. Factors that could cause a company's actual results and financial condition to differ from expectations include, without limitation: political uncertainty, changes in general economic conditions that adversely affect the level of demand for the company's products or services, changes in foreign exchange markets, changes in international and domestic financial markets and in the competitive environment, and other factors relating to the foregoing. All forward-looking statements contained in this report are qualified in their entirety by this cautionary statement.

Other countries: Laws and regulations of other countries may also restrict the distribution of this report. Persons in possession of this document should inform themselves about possible legal restrictions and observe them accordingly.

27 CONTACT LIST

ANDEAN RESEARCH TEAM SALES & TRADING

Daniel Velandia, CFA Felipe García Head of Research & Chief Economist Head of Sales & Trading [email protected] [email protected] # (571) 339 4400 Ext 1505 # (571) 339 4400 Ext. 1132

EQUITY RESEARCH EQUITY SALES & TRADING

Carolina Ratto Mallie Andre Suaid Head of Equity Research - Retail Head of Equities [email protected] [email protected] # (562) 2446 1768 # (562) 2446 1710

CHILE PERU COLOMBIA CHILE PERU COLOMBIA

Tomás Sanhueza Daniel Córdova Sebastián Gallego, CFA German Barousse Rodrigo Zavala Juan A. Jiménez Head of Equity Research - Consumer & Head of Equity Research Peru Head of Equity Research - Banks Vice President Equity Sales Head of Capital Markets - Peru Head of International Equity Sales Transport. [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] # (562) 2446 1751 # (511) 416 3333 Ext 33052 # (571) 339 4400 Ext 1594 # (562) 2450 1637 # (511) 313 2918 Ext 36044 # (571) 339 4400 Ext 1701

Andrés Cereceda Juan Pablo Brosset Steffania Mosquera Ursula Mitterhofer Renzo Castillo Santiago Castro Associate: Pulp & Paper, Materials, Analyst: Cement & Construction Senior Analyst: Cement & Construction, Senior Associate Sales & Trading Equities Sales International Sales & Trading Healthcare, Pension Funds [email protected] Non Bank financials [email protected] [email protected] [email protected] [email protected] # (511) 416 3333 Ext 36018 [email protected] # (562) 2450 1613 # (511) 416 3333 Ext 36167 # (571) 339 4400 Ext 1344 # (562) 2446 1798 # (571) 339 4400 Ext 1025 Ana María Bauzá Maria Fernanda Luna Credicorp Capital Securities INC Joel Lederman Daniel Mora Corporate Access Equities Sales Associate - Retail Analyst- Banks [email protected] [email protected] [email protected] [email protected] # (562) 2450 1609 # (511) 416 3333 Ext 36182 Rafael Solis # (562) 2651 9332 # (571) 339 4400 Ext 1609 Institutional Equity Sales Credicorp Capital UK Ltd. [email protected] Felipe Navarro Nicolas Erazo # (786) 999 1619 Senior Analyst: Construction, Industrial & Ports Analyst - Utilities Marilyn Macdonald [email protected] [email protected] International Equity Sales # (562) 2450 1688 # (571) 339 4400 Ext 1365 [email protected] # (4477) 7151 5855 Macarena Ossa Analyst - Utilities [email protected] # (562) 2450 1694

Agustina Maira Research Coordinator [email protected] # (562)2434 6433

FIXED INCOME & ECONOMICS RESEARCH FIXED INCOME SALES & TRADING

CHILE PERU COLOMBIA Andrés Nariño Alfredo Bejar Director Sales Offshore Head of International FI Josefina Valdivia Cynthia Huaccha Camilo A. Durán [email protected] [email protected] Head of Fixed Income Fixed Income Associate Macro Analyst # (571) 339-4400 Ext. 1459 # (511) 205 9190 Ext 36148 [email protected] [email protected] [email protected] # (562) 2651 9308 # (511) 416 3333 Ext 37946 # (5511) 339 4400 Ext. 1383 CHILE PERU COLOMBIA

Alejandro Toth Guido Riquelme Evangeline Arapoglou Carlos Sanchez Analyst Fixed Income Head of Capital Markets Chile Head of international FI Sales Head of Fixed Income [email protected] [email protected] [email protected] [email protected] # (562) 2651 9368 # (562) 2446 1712 # (511) 416 3333 Ext 36099 # (571) 323 9154

Juan Francisco Mas Andrés Valderrama Gustavo Trujillo Fixed Income Sales Fixed Income Sales Head of Sales [email protected] [email protected] [email protected] # (562) 2446 1720 # (511) 416 3333 Ext 40352 # (571) 323 9252

Rafael Gaete Natalia Jurado Andrés Agudelo Local Fixed Income Sales Fixed Income Sales Fixed Income Sales [email protected] [email protected] [email protected] # (562) 2651 9336 # (511) 416 3333 Ext 36027 # (571) 339 4400 Ext 1180

Diego Hidalgo Pamela Horna Emilio Luna Local Fixed Income Sales Fixed Income Sales Fixed Income Sales [email protected] [email protected] [email protected] # (562) 2450 1693 # (511) 313 2902 Ext. 42942 # (571) 339 4400

Lizeth Espiritu Carla Tejada Credicorp Capital Securities INC Fixed Income Sales Fixed Income Analyst [email protected] [email protected] # (562) 2450 1619 # (511) 416 3333 Ext. 36143 Jhonathan Rico Fixed Income Trader Ana Lucía Rondón Medina [email protected] Sales Renta Fija # 1 (786) 9991614 [email protected] # (511) 416 3333 Ext. 40339 Michael Tafur Fixed Income [email protected] # 1 (786) 9991607

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