THIS APPLICATION PROOF IS IN DRAFT FORM. The information contained herein is incomplete and is subject to change. This Application Proof must be read in conjunction with the section headed ‘‘Warning’’ on the cover of THIS Application Proof. This document supersedes the Application Proof dated 15 April 2014. INDUSTRY OVERVIEW Potential investors should note that ~Ipsos has been engaged by our Company to prepare the ~Ipsos Report to provide an overview of the development of the global consumer electronic devices and an analysis on demand in consumer electronic devices market, which will be used in whole or in part in this ~prospectus. The information and statistics set out in this section have been extracted from the ~Ipsos Report compiled by ~Ipsos and other publicly available sources. Our Directors believe that the sources of this information are appropriate sources for such information and have taken reasonable care in extracting and reproducing such information. Our Directors have no reason to believe that such information is false or misleading or that any fact has been omitted that would render such information false or misleading. The information has not been independently verified by our Group, the ~Lead Manager, the ~Sponsor, the ~Underwriters or any other party involved in the ~Placing and no representation is given as to its accuracy. Accordingly, such information should not be unduly relied upon. DEMAND OVERVIEW AND ANALYSIS OF GPS PERSONAL NAVIGATION DEVICES IN THE MARKET Market Overview of GPS personal navigation devices in Europe Accordingtothe~Ipsos Report, car navigation is the main business of GPS personal navigation device brand owners in the European market. GPS personal navigation devices are categorised into consumer usage devices and commercial usage devices, and are then further sub-categorised by functions. The key market players of GPS personal navigation devices in Europe are Garmin Ltd., TomTom (TOM2) and Mai-Tech Technologies Ltd (which owns two brands: Mio and Magellan). In addition, there are some European GPS personal navigation device brands, such as BOLERO, Falcom, Navman etc. The GPS personal navigation device market is Europe is fragmented. TomTom, Garmin, Mio and other small brands accounts for approximately 38%, 19%, 12% and 31% of market share, respectively. Market Overview of GPS personal navigation devices in Taiwan Accordingtothe~Ipsos Report, in Taiwan, the main functions of GPS personal navigation devices not only can provide latitude and longitude information but also track locations of a person, a pet or a car. GPS personal navigation devices are also categorised as consumer usage devices and commercial usage devices. In Taiwan, most GPS personal navigation devices include integrated TV, tracker and video functions. The key players of GPS personal navigation devices in Taiwan are: Garmin Ltd., TomTom (TOM2) and Mio Technology. Total Retail Sales Value of GPS personal navigation devices Total Retail Sales Value of GPS personal navigation devices for Europe and Taiwan from 2008 to 2017 US$’ million 10,000 9,505.2 9,000 8,720.4 8,000.3 8,000 7,444.0 7,524.0 7,339.7 6,991.8 6,733.7 7,000 6,177.7 6,000 5,133.6 5,000 4,000 3,000 2,000 1,000 223.3 159.1 218.2 209.8 179.2 202.0 220.2 240.0 261.6 275.7 0 200820092010 2011 2012 2013 2014 2015 2016 2017 Forecast Europe Taiwan Source: ~Ipsos Report – 54 – THIS APPLICATION PROOF IS IN DRAFT FORM. The information contained herein is incomplete and is subject to change. This Application Proof must be read in conjunction with the section headed ‘‘Warning’’ on the cover of THIS Application Proof. This document supersedes the Application Proof dated 15 April 2014. INDUSTRY OVERVIEW Due to the global financial crisis in 2008, the total retail sales value of GPS personal navigation devices for Europe declined by approximately 31.0% in 2009; meanwhile the total retail sales value of GPS personal navigation devices for Taiwan also reduced by approximately 29.0% in 2009. It may be said that in that year, people did not have budgets to purchase some high-tech products, such as GPS personal navigation devices. ThegrowthrateofEurope’s total sales values increased slightly by approximately 0.9% from 2012 to 2013. The global GDP growth rate is expected to remain stable in 2013 to 2017, it is expected that the demand of GPS personal navigation devices will increase in Europe because of the growing number of tourists. One trend shows that more and more tourists like travelling in vehicles when they travel in Europe, thus the demand of automotive GPS personal navigation devices will rise. In Taiwan, in these two years, the prices of GPS personal navigation devices have become cheaper (less than US$100) and the penetration rate of GPS devices is also becoming higher. In other words, people can make their shopping decisions faster due to lower prices (low involvement products). Therefore the demand of GPS personal navigation devices is growing. OVERVIEW OF GPS PERSONAL NAVIGATION DEVICE MANUFACTURING INDUSTRY IN CHINA Overall Supply and Production China has been one of the major production regions of GPS personal navigation devices due to low labour costs and lenient environmental regulations. OEM manufacturers, in the GPS personal navigation device manufacturing industry in China, tend to develop their own brands. Plenty of OEM manufacturers, such as Link-create (盈科創展), tend to produce GPS personal navigation devices under their own brands after they reach a certain production scale by providing OEM services. Estimated Total Production Value of GPS personal navigation devices in China from 2008 to 2017 US$’ million 8,000 7,000 6,364.2 5,940.1 6,000 5,546.6 5,181.3 4,842.2 5,000 4,645.7 4,383.0 4,031.5 4,036.0 4,000 3,503.8 3,000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 forecast Production value of GPS personal navigation devices in China Source: ~Ipsos Report It is expected that the total production value of GPS personal navigation devices in China will grow at a CAGR of approximately 7.1% from approximately US$4,842.2 million in 2013 to approximately US$6,364.2 million in 2017. Such expected increase is mainly due to the increasing popularity of GPS personal navigation devices amongst the consumers in China usage. Car navigation systems have become a kind of necessities, and have started to tap the mid-to-low-end vehicle users; while GPS personal navigation devices have been regarded as common consumer electronic products by the consumers. The total production value of GPS personal navigation devices in China grew from approximately US$4,031.5 million in 2008 to approximately US$4,645.7 million in 2012. – 55 – THIS APPLICATION PROOF IS IN DRAFT FORM. The information contained herein is incomplete and is subject to change. This Application Proof must be read in conjunction with the section headed ‘‘Warning’’ on the cover of THIS Application Proof. This document supersedes the Application Proof dated 15 April 2014. INDUSTRY OVERVIEW With the recovery of the world’s economy in 2010, the automotive sector worldwide also recovered, whichhelpedChina’s GPS personal navigation devices production to grow and the total production value reached approximately US$4,036.0 million in 2010. Total Number of GPS personal navigation devices Manufacturers in China from 2008 to 2012 Number 500 450 425 400 380 300 300 270 200 100 0 2008 2009 2010 2011 2012 Number of GPS personal navigation device manufacturers in China Source: ~Ipsos Report The growth in the total number of GPS personal navigation device manufacturers in the past five years was mainly attributed to the rising demand for GPS personal navigation devices in automotive segment. The booming automotive market in China attracted plenty of new entrants to enter the GPS personal navigation device manufacturing industry in China. There are over 500 GPS personal navigation device brands currently active in China market in 2013. However, the brand owners tend to engage in product development and distribution, rather than in manufacturing. Hence, GPS personal navigation device manufacturers in China are mostly OEMs or ODMs and cooperate with several GPS personal navigation device brand owners simultaneously. Historical Price Trend of Key Raw Materials in China Historical LCD Panels and Price Trend of Electronic ICs in China from 2008 to 2012 US$/unit 25 22.8 19.0 18.7 20 16.7 13.9 15 10 5 0.90.8 0.8 0.8 0.9 0 2008 2009 2010 2011 2012 IC LCD Panels Source: ~Ipsos Report – 56 – THIS APPLICATION PROOF IS IN DRAFT FORM. The information contained herein is incomplete and is subject to change. This Application Proof must be read in conjunction with the section headed ‘‘Warning’’ on the cover of THIS Application Proof. This document supersedes the Application Proof dated 15 April 2014. INDUSTRY OVERVIEW The price of LCD panels dropped significantly from approximately US$22.8 per unit in 2008 to approximately US$13.9 per unit in 2012. The significant price drop in price of LCD panels was due to the drop in the import price brought about by the increasing production capacity, more LCD panel makers and innovative production technology. The LCD panel price and the selling price of GPS personal navigation devices are negatively correlated, possibly due to the higher capacity of the ICs. The increase in the number of components resulting from a more powerful ICs could be the main driver of the price increase of the GPS personal navigation devices. The price of ICs in China dropped slightly from 2008 to 2012, staying within the price range of approximately US$0.8 per unit to approximately US$0.9 per unit in these 5 years.