India

Sector Update

Underweight
BSE REALTY: SENSEX:
Anubhav Gupta anubhav@maybank-ke.co.in (91) 22 66232605

India Property Sector

1,725 17,213

16 July 2012

In real trouble; only price correction will help

Negative on Mumbai, Delhi markets. In our recent country-wide market survey of developers, we had concluded end-user demand for New Delhi and Mumbai markets continued to be weak. Jan-May sales volumes of housing projects are down 25-30% YoY as customers are delaying purchases because of poor affordability. Most projects are running behind schedule due to paucity of funds. Developers have cut supply to sustain current property prices. However, we found that the Bangalore market is relatively stable with sales volume down just 10%. We maintain negative outlook on Delhi and Mumbai-based developers DLF Ltd (DLFU), HDIL Ltd (HDIL) and Godrej Properties (GPL) and initiate coverage on Bangalore-based Sobha Developers (SOBHA) with BUY recommendation. Unsold inventory of 80k homes in Mumbai (worth Rs700bn). This is because sales volume declined 30% in Jan-May. Pre-sales in Mumbai were hurt the most as buyers waited for price correction. In the last 2 years, affordability of home buyers has declined 15% because of high interest rates and property prices. We expect Mumbai sales volume to remain subdued as buyers will return only if developers cut prices or their affordability improves following substantial cut in interest rates. New Delhis and NCRs Jan-May pre-sales down 25%. We believe New Delhi and the NCR markets face maximum risk of price correction as developers may be desperate to sell inventory to generate cash. The financial crunch is most severe for DLFU, Unitech (UT), Omaxe Ltd (OAXE) and Parsvnath Developers (PARSV) because of worsening interest coverage ratios. Fall in Bangalore sales much lower than other cities. Property demand in Bangalore is relatively stable because property prices remained unchanged in the last 1 year vs. 25% rise in Mumbai and Delhi. This suggests that property prices have not been kept artificially high in Bangalore. There is genuine demand in the city because IT companies are still expanding operations and new hiring has not slowed down. Negative on sector but recommend SOBHA, IBREL and MLIFE. SOBHA is operating in Bangalore where there is little threat to property prices and demand from end-customers is strong. We like IBREL, MLIFE because they have projects country wide and have strong B/S. We are negative on DLFU, HDIL and GPL because their major markets are not performing well and they have overleveraged B/S, which may force them to cut inventory price to generate cash.
Contractors: Valuation and Recommendation Mcap CMP TP PER (x) P/BV (Yr to Mar) Ticker (US$bn) (Rs) (Rs) FY13F FY14F (x) Reco. DFL Ltd DLFU 6.4 211 159 29.0 26.7 1.3 Sell Godrej Properties GPL 0.7 522 464 37.9 33.3 2.7 Sell HDIL Ltd HDIL 0.7 89 81 4.1 2.7 0.3 Sell Sobha Developers SOBHA 0.6 337 390 13.0 9.5 1.5 Buy Indiabulls R Estate IBREL 0.5 64 88 10.9 8.9 0.4 Buy Mahindra Lifespace MLIFE 0.2 325 393 9.1 7.5 1.0 Buy Source: Bloomberg, KESI estimates

Historical Chart
10 0 -10 -20 -30 -40 (%)

Jul-11

Nov -11 BSE Realty

Mar-12 SENSEX

Jul-12

Performance: BSE Realty Index

52-week High/Low
Absolute (%) Relative (%)

2,231/1,367
6-mth 12.9 5.5 1-yr -17.3 -10.9 YTD 27.7 16.6

1-mth 4.9 2.7

3-mth -1.8 -1.2

SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS

India Property

Our recent property survey

15 brokers queried. Our survey included interaction with property brokers in Delhi, Mumbai, Chennai, Bangalore and Hyderabad and discussions with sales representatives of developers. Low volume, no discounts, delayed project deliveries. The major points from our survey: No major new launches in the past 12 months Sales volume down 25-30% in Delhi and Mumbai Developers are not willing to cut prices Project deliveries are being delayed by up to 2 yrs Customers are delaying purchases in anticipation of price correction and interest rate reduction Demand for office units is at 5-yr low Office rentals are down 50%

Presales
Pre-sales down sharply in Jan-May. Developers in Mumbai and Delhi are hurt the most, with presales down by up to 30% YoY. Our channel checks suggest that customers are waiting for developers to reduce property prices, which have risen 30% over the last 1 year. In a few sections of Mumbai and Delhi, prices increased 40%. Increase in prices over the last 12 months Housing projects
Area Thane Mumbai Pune Gurgaon Noida Kolkata Chennai Bengaluru Hyderabad Greater Noida Source: KESI estimates % 15 30 20 30 33 -9 35 5 4 30

More stability in Bangalore property prices. During our interaction, Mumbai & Delhi developers admitted that customer purchases have slowed down and buyers are expecting them to reduce prices. Quarterly property price trend
330

260

190

120

50 Mumbai Delhi Q1 Bangalore Q2 Q3 Q4 Kolkata Chennai

Source: NHB RESIDEX

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India Property
FY13 pre-sales to remain unchanged. Last year, pre-sales declined 40% to Rs94bn because of poor demand. As we do not expect the situation to improve soon, we believe FY13 pre-sales would also suffer. We forecast flat pre-sales thru Mar 13. Aggregate pre-sales Housing projects (Rs bn)
159 155

115 94 94

33 FY08 FY09 FY10 FY11 FY12 FY13F

Source: Company data, KESI estimates

Inventory
Inventory piles up. Following a slowdown in pre-sales, developers are left with larger inventories (in some cases, equivalent to annual sales worth 10 years). Inventory (m sq ft)
Company DLFU SOBHA IBREL HDIL MLIFE GPL Land bank 348.0 109.0 128.0 236.0 50.0 75.8 Saleable area 325.0 105.0 125.0 225.0 43.5 80.2 Project delivery in FY13F 13.8 2.3 4.3 7.7 1.3 1.8

Source: Company data, KESI estimates

Project deliveries suffer due to construction delays. In our survey, we found that most projects are running behind schedule because developers did not have sufficient funds. FY12 deliveries declined 15%. We expect further decline this year because pre-sales have not recovered and a cash crunch would prevent the developers from completing projects on time.

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India Property

D/E to remain high due to CF shortfalls

Total forecast CF shortfall of Rs155bn in FY13/14. Last year, the developers (in our coverage) raised new debt of Rs50bn to fund CF shortfalls. Over the next 2 years, we expect CF shortfall of Rs155bn. With recent failed attempts from a few developers to raise more cash, we fear they may have to sell assets/clear inventory or raise new debt to fund CF shortfalls. Interest coverage ratio (x)
8.7

2.6 1.5 FY08 FY09 FY10

1.3 FY11

1.2 FY12

1.3 FY13F

Source: Company data, KESI estimates

Asset sales uncertain. In FY12, DLFU could sell non-core asset sales of Rs17bn only vs. its target of Rs55bn. With total CF shortfall of Rs57bn over the next 2 years, we fear there will still be delays in project deliveries or increased borrowings/interest cost for DLFU. To improve CF, DLF must aggressively sell non-core asset and cancel land purchases. Debt-to-EBITDA (x)
6.2 6.2

6.0

6.1

3.4

1.3 FY08 FY09 FY10 FY11 FY12 FY13F

Source: Company data, KESI estimates

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India Property

Valuations and Recommendations

BUY SOBHA, IBREL, MLIFE. We like SOBHA and IBREL whose FY13 earnings will increase 25% and 30% respectively. SOBHA focuses on mid-priced projects in Bangalore and would pre-sell property worth Rs20bn in FY13 (+20% YoY). Half of this years earnings are secured by the backlog. IBREL and MLIFE are selling housing projects across the country. The stocks are trading at low PER of 11x and 9x FY13F respectively vs. sector avg of 17.5x. PER (x)
44

34

24

14

4 FY11 DLFU HDIL FY12 IBREL MLIFE GPL FY13F SOBHA

Source: KESI estimates

SELL DLFU, GPL, HDIL. We recommend SELL on DLFU and GPL, which are trading at an unreasonable PER of 29x and 38x FY13F respectively. DLFUs FY13 earnings will be flat at Rs7.3/sh and GPLs will rise 10%. Further, the New Delhi, NCR and Mumbai regions, where DLFU and GPL sell projects, are suffering from over supply in low-tomid priced housing projects. For DLFU, 20% of earnings depend on sale of office units. Demand in this segment has been affected the most. Although HDIL is trading at the cheapest valuations (PER of 4.5x, P/BV of 0.4x FY13F), we recommend SELL because of delayed execution of its large Mumbai Airport Slum Redevelopment project and low demand for constructions rights in Mumbai.

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India Property

BUY (Initiate)
Share price: Target price: Rs337/sh Rs390/sh

Sobha Developers (DLFU)

Backlog, new launches support strong EPS

Focus on strong customer segment. SOBHA sells 40% of its housing projects to IT professionals in Bangalore. The demand in this segment is strong because IT companies are not slowing expansion. SOBHA has backlog of Rs12bn, which secures 70% of FY13F earnings of Rs2.5bn, up 25%. By end-FY13, backlog may double on new H2 launches of Rs25bn. This will support next years earnings growth of 35%. D/E of 0.7x is comfortable, given that the companys present land bank is fullpaid up. We value the stock at Rs390/sh based on PER of 15x FY13F. FY13F presales of Rs20bn, +20%. Currently, SOBHA has inventory of Rs8bn for sale. Further, new launches of Rs25bn will support pre-sales growth this year. Strong pre-sales at October launches alone can increase current backlog by 50%. Pre-sales of 2k housing units in FY13 can be easily achieved. SOBHAs products are priced between Rs5m and Rs30m. Its target customers have salary of Rs1m to Rs5m pa. Since FY06, the number of such families has doubled to 3.4m in Bangalore. Our presales forecast of 2k housing units is conservative, given total sales of 300k units pa in Bangalore. Demand for homes will remain strong in H2 due to festive seasons of October/November. Sustainable GM of 38%. SOBHA has its own contracting unit because of which it secures construction margin. Hence, its 38% GM is sustainable. Currently, 60% of work in housing projects is done by the own contracting unit. We see little no risk to Bangalore property prices because of sustained demand from IT professionals in the city. Earnings will rise 75% through FY14 on strong revenue growth. D/E of 0.7x, FY12/13 CAPEX of Rs6bn. Over the next 3 years, SOBHA will invest Rs6bn to fund new launches and complete ongoing projects. This will be funded from new debt and internal CF. Target PER of 15x - Avg sector PER is 17.5x. The stock is trading at PER of 13x FY13F at 25% discount to peers. We recommend BUY based on strong earnings growth. Y-T-D, the stock has outperformed its peers by 55% because of strong Q4FY12 earnings performance (EPS increased 120% YoY). We expect the stock to continue to outperform. It could rally on confirmation of strong pre-sales for October launches worth Rs18bn.
SOBHA Summary Earnings Table FY Mar 31 (Rsm) FY10 Revenue 11,299 EBITDA 2,463 Recurring Net Profit 1,341 Recurring EPS (Rs) 13.7 EPS growth (%) 166 DPS (Rs) 2.5 PER (x) EV/EBITDA (x) Div Yield (%) P/BV (x) 47.8 18.1 0.7 3.8 FY11 14,739 3,161 1,813 18.5 35 3.0 18.2 14.1 0.9 1.8 65.5 9.8 4.7 FY12 14,079 4,666 2,061 21.0 14 5.0 16.0 9.6 1.5 1.7 57.9 10.3 4.9 FY13F 17,077 5,489 2,551 26.0 24 5.0 13.0 8.1 1.5 1.5 73.2 11.6 5.2 2,412 FY14F 22,767 6,635 3,480 35.5 36 5.0 9.5 6.7 1.5 1.3 76.3 14.0 6.1 3,030

Stock Information
Description: Ticker: Shares Issued (m): Market Cap (US$ bn): 6-mth Avg Daily Volume (US$m): SENSEX: Free float (%): Major Shareholders: Sobha Menon & family Aranda Investments Mauritius Pte Ltd Emerging Markets Growth Fund Inc SOBHA IN 90 0.6 1.6 17,213 39.5 60.5 4.2 3.7

Key Indicators (FY13F) ROE annualised (%) Net debt (Rs bn): NTA (Rs/sh): Interest cover (x): 11.6 16.0 224.1 2.9

Historical Chart

30 15 0 -15 -30

(%)

Jul-11

Nov -11 SOBHA

Mar-12 SENSEX

Jul-12

Performance: 52-week High/Low 1-mth 1.7 -2.3

Rs357/297 3-mth 3.4 2.4 6-mth 59.8 49.8 1-yr 18.2 25.3 YTD 69.9 57.9

Absolute (%) Relative (%)

Net Debt/Equity (%) 81.7 ROE (%) 7.9 ROA (%) 3.5 Consensus Net Profit (Rsm) Source: Company data, Bloomberg, KESI estimates

Page 6 of 12

India Property

SOBHA: Home buyers profile

Others 48%

IT professionals 39%

Self employed 9%

Medical professionals 4%

Source: Company data, KESI

SOBHA: FY13 launches

Projects Bangalore Dairy Circle Property Hosakerehalli Property City Property Hirandahalli Property Hosahalli Property St.Marks Road Property Coimbatore Harishree Gardens 5 Thrissur Sobha Jade Sobha City-Commercial 2 Mysore Nadanahalli property Total Source: Company data Location Bannerghatta Road Hosakerehalli, Mysore Road Minerva Mills, Gopalapura Off Old Madras Road Kanakapura Road St.Marks Road Type Residential + Commercial L+SL Apartments Residential + Commercial Villas + Apartments Residential Commercial Area (m sq ft) 0.2 1.4 0.9 0.3 0.5 0.1

Veerakeralam Thrissur, Kerala Thrissur, Kerala

Super Luxury Villas SL Apartments Office + Hotel Space

0.1 0.5 0.2

Nadanahalli

Plotted Development

0.1 4.3

SOBHA: New launches, Presales (Rs bn)

26 23 20 18 17 26 22

11

FY11

FY12
New launches

FY13F
Presales

FY14F

Source: Company data, KESI

Page 7 of 12

India Property
Summary Results Table FY Mar (Rsm) Revenue Cost of sales, ex depr Selling, admn. & R&D exp. EBITDA Depreciation Operating profit Other income / expense Interest expensed Pretax Profit Tax Minority interest Recurring profit Exceptional items Net profit Recurring EPS (Rs) Gross Margin (%) EBITDA Margin (%) Tax rate (%) Source: Company data 4Q12 4,769 -2,488 -475 1,806 -117 1,689 13 -371 1,331 -441 0 890 0 890 9.1 45.4 37.9 33.1 4Q11 3,374 -2,263 -439 672 -69 603 47 -115 535 -133 0 402 0 402 4.1 30.9 19.9 24.9

Quarterly % YoY 41 10 8 169 70 180 -72 223 149 232 n.a. 121 n.a. 121 121.4 14.5 18.0 8.3

3Q12 3,137 -1,960 -424 753 -106 647 23 -93 577 -176 0 401 0 401 4.1 34.1 24.0 31

% Q0Q 52 27 12 140 10 161 -43 299 131 151 n.a. 122 n.a. 122 121.9 11.2 13.9 2.6

FY12 14,079 -8,418 -994 4,666 -388 4,278 65 -1,165 3,178 -1,077 -41 2,061 0 2,061 21.0 37.5 33.1 33.9

Cumulative FY11 14,739 -10,583 -994 3,161 -278 2,883 75 -444 2,514 -669 -33 1,813 0 1,813 18.5 26.3 21.4 26.6

% YoY -4 -20 0 48 40 48 -13 163 26 61 25 14 n.a. 14 13.7 11.1 11.7 7.3

Page 8 of 12

India Property
INCOME STATEMENT (Rsm) FY March Revenue Cost of Sales Selling & Admin Expenses EBITDA Depreciation & Amortisation Operating Profit (EBIT) Other income Interest (Exp)/Inc Associates One-offs Pre-Tax Profit Tax Minority Interest Net Profit Recurring Net Profit Revenue Growth % EBITDA Growth (%) EBIT Growth (%) Net Profit Growth (%) Recurring Net Profit Growth (%) Tax Rate % CASH FLOW (Rsm) FY March EBITDA Accounts Receivables Inventory Working Capital Operating cash flow Interest TAX Residual Cashflow Fixed Assets Investments Free Cashflow Capital Increase Dividend Payments Others/Minority Interest Net Change in Cashflow Net Debt Beg Net Debt End DU PONT ANALYSIS FY March Profit Margin (x) Total Asset Turnover (x) Equity Multiplier (x) ROE (%) BALANCE SHEET (Rsm) FY March Fixed Assets Other LT Assets/Investments Cash and equivalents Receivables Inventories Other Current Assets Total Assets Unsecured Debt Other Current Liabilities Secured Debt Other LT Liabilities Minority Interest Shareholders' Equity Total Liabilities-Capital Share Capital (m) Gross Debt/(Cash) Net Debt/(Cash) Working Capital

FY11 14,739 -10,583 -994 3,161 -278 2,883 75 -444 0 0 2,514 -669 -33 1,813 1,813 30.4 28.3 -87.4 35.2 35.2 26.6

FY12 14,079 -8,418 -994 4,666 -388 4,278 65 -1,165 0 0 3,178 -1,077 -41 2,061 2,061 -4.5 47.6 48.4 13.7 13.7 33.9

FY13F 17,077 -10,382 -1,206 5,489 -427 5,063 71 -1,250 0 0 3,883 -1,282 -51 2,551 2,551 21.3 17.6 18.3 23.8 23.8 33.0

FY14F 22,767 -14,524 -1,608 6,635 -85 6,551 78 -1,331 0 0 5,298 -1,748 -69 3,480 3,480 33.3 20.9 29.4 36.4 36.4 33.0

FY11 2,041 37 288 4,252 10,685 21,583 38,885 83 7,709 12,335 -74 324 18,508 38,885 98 12,418 -12,130 29,099

FY12 2,814 37 587 3,922 16,746 18,267 42,372 0 9,527 12,162 330 355 19,998 42,372 98 12,162 -11,575 29,994

FY13F 2,924 39 -929 4,757 19,440 22,820 49,050 0 11,556 15,162 0 355 21,977 49,050 98 15,162 -16,091 34,531

FY14F 3,431 41 -2,823 6,342 24,070 25,749 56,809 0 15,406 16,162 0 355 24,886 56,809 98 16,162 -18,985 37,931

FY11 3,161 178 1,874 -301 4,913 -1,901 -669 2,343 -242 64 2,166 0 -343 -38 1,785 -13,915 -12,130

FY12 4,666 330 -5,444 5,134 4,686 -1,782 -1,077 1,828 -1,572 65 321 0 -572 806 555 -12,130 -11,575

FY13F 5,489 -835 -2,031 -2,524 99 -1,913 -1,282 -3,095 -537 115 -3,517 0 -572 -427 -4,516 -11,575 -16,091

FY14F 6,635 -1,585 -3,925 921 2,047 -2,036 -1,748 -1,738 -591 127 -2,202 0 -572 -120 -2,894 -16,091 -18,985

RATES & RATIOS FY March Gross Margin % EBITDA Margin % Op. Profit Margin % Net Profit Margin % ROE % ROA % Dividend Cover (x) Interest Cover (x) Asset Turnover (x) Asset/Debt (x) Debtors Turn (days) Creditors Turn (days) Inventory Turn (days) Net Debt/Equity % Debt/ EBITDA (x) Debt/ Market Cap (x)

FY11 26.3 21.4 19.6 12.3 9.8 4.7 6.2 7.1 0.4 3.1 105.3 243.0 264.6 65.5 3.9 0.4

FY12 37.5 33.1 30.4 14.6 10.3 4.9 4.2 4.0 0.3 3.5 101.7 369.4 434.1 57.9 2.6 0.4

FY13F 36.7 32.1 29.6 14.9 11.6 5.2 5.2 4.4 0.3 3.2 101.7 364.0 415.5 73.2 2.8 0.5

FY14F 35.8 29.1 28.8 15.3 14.0 6.1 7.1 5.0 0.4 3.5 101.7 348.6 385.9 76.3 2.4 0.5

FY11 0.1 0.4 2.1 9.8

FY12 0.1 0.3 2.1 10.3

FY13F 0.1 0.3 2.2 11.6

FY14F 0.2 0.4 2.3 14.0

KEY ASSUMPTIONS (Rsm) FY March Presales Change In Presales (%) Area Presold (m sqft) Total average debt Average interest Rate (%) Total interest Interest capitalized (%)

FY11 11,330 105.8 2.8 13,579 14.0 1,901 76.7

FY12 17,010 50.1 3.3 12,290 14.5 1,782 34.6

FY13F 19,836 16.6 3.8 13,662 14.0 1,913 34.6

FY14F 22,256 12.2 4.1 15,662 13.0 2,036 34.6

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India Property
ANALYSTS COVERAGE / RESEARCH OFFICES
MALAYSIA
WONG Chew Hann, CA Head of Research (603) 2297 8686 wchewh@maybank-ib.com Strategy Construction & Infrastructure Desmond CHNG, ACA (603) 2297 8680 desmond.chng@maybank-ib.com Banking - Regional LIAW Thong Jung (603) 2297 8688 tjliaw@maybank-ib.com Oil & Gas Automotive Shipping ONG Chee Ting (603) 2297 8678 ct.ong@maybank-ib.com Plantations Mohshin AZIZ (603) 2297 8692 mohshin.aziz@maybank-ib.com Aviation Petrochem Power YIN Shao Yang, CPA (603) 2297 8916 samuel.y@maybank-ib.com Gaming Regional Media Power WONG Wei Sum, CFA (603) 2297 8679 weisum@maybank-ib.com Property & REITs LEE Yen Ling (603) 2297 8691 lee.yl@maybank-ib.com Building Materials Manufacturing Technology LEE Cheng Hooi Head of Retail chenghooi.lee@maybank-ib.com Technicals

SINGAPORE
Stephanie WONG Head of Research (65) 6432 1451 swong@maybank-ke.com.sg Strategy Small & Mid Caps Gregory YAP (65) 6432 1450 gyap@maybank-ke.com.sg Technology & Manufacturing Telcos - Regional Rohan SUPPIAH (65) 6432 1455 rohan@maybank-ke.com.sg Airlines Marine & Offshore Wilson LIEW (65) 6432 1454 wilsonliew@maybank-ke.com.sg Hotel & Resort Property & Construction Anni KUM (65) 6432 1470 annikum@maybank-ke.com.sg Conglomerates REITs James KOH (65) 6432 1431 jameskoh@maybank-ke.com.sg Finance Logistics Resources Eric ONG (65) 6432 1857 ericong@maybank-ke.com.sg Marine & Offshore Transportation Energy OOI Yi Tung (65) 6433 5712 ooiyitung@maybank-ke.com.sg Property & Construction YEAK Chee Keong, CFA (65) 6433 5730 yeakcheekeong@maybank-ke.com.sg Retail & Consumer Engineering Infrastructure Alison FOK (65) 6433 5745 alisonfok@maybank-ke.com.sg Services Bernard CHIN (65) 6433 5726 bernardchin@maybank-ke.com.sg Conglomerates Industrials

THAILAND
Mayuree CHOWVIKRAN Head of Research (66)-2658-6300 ext 1440 mayuree.c@kimeng.co.th Strategy Suttatip PEERASUB (66)-2658-6300 ext 1430 suttatip.p@kimeng.co.th Media Commerce Sutthichai KUMWORACHAI (66)-2658-6300 ext 1400 sutthichai.k@kimeng.co.th Energy Petrochem Termporn TANTIVIVAT (66)-2658-6300 ext 1520 termporn.t@kimeng.co.th Property Woraphon WIROONSRI (66)-2658-6300 ext 1560 woraphon.w@kimeng.co.th Banking & Finance Jaroonpan WATTANAWONG (66)-2658-6300 ext 1404 jaroonpan.w@kimeng.co.th Transportation Small cap.

PHILIPPINES
Luz LORENZO Head of Research +63 2 849 8836 luz_lorenzo@maybank-atrke.com Strategy Laura DY-LIACCO (63) 2 849 8840 laura_dyliacco@maybank-atrke.com Utilities Conglomerates Telcos Lovell SARREAL (63) 2 849 8841 lovell_sarreal@maybank-atrke.com Consumer Media Cement Mining Kenneth NERECINA (63) 2 849 8839 kenneth_nerecina@maybank-atrke.com Conglomerates Property Ports/ Logistics Katherine TAN (63) 2 849 8843 kat_tan@maybank-atrke.com Banks Construction

HONG KONG / CHINA

Edward FUNG Head of Research (852) 2268 0632 edwardfung@kimeng.com.hk Construction Ivan CHEUNG (852) 2268 0634 ivancheung@kimeng.com.hk Property Industrial Ivan LI (852) 2268 0641 ivanli@kimeng.com.hk Banking & Finance Jacqueline KO (852) 2268 0633 jacquelineko@kimeng.com.hk Consumer Staples Andy POON (852) 2268 0645 andypoon@kimeng.com.hk Telecom & equipment Samantha KWONG (852) 2268 0640 samanthakwong@kimeng.com.hk Consumer Discretionaries Alex YEUNG (852) 2268 0636 alexyeung@kimeng.com.hk Industrial

INDONESIA
Katarina SETIAWAN Head of Research (62) 21 2557 1125 ksetiawan@kimeng.co.id Consumer Strategy Telcos Lucky ARIESANDI, CFA (62) 21 2557 1127 lariesandi@kimeng.co.id Base metals Coal Heavy Equipment Oil & Gas Rahmi MARINA (62) 21 2557 1128 rmarina@kimeng.co.id Banking Multifinance Pandu ANUGRAH (62) 21 2557 1137 panugrah@kimeng.co.id Auto Heavy equipment Plantation Toll road Adi N. WICAKSONO (62) 21 2557 1130 anwicaksono@kimeng.co.id Generalist Anthony YUNUS (62) 21 2557 1134 ayunus@kimeng.co.id Cement Infrastructure Property Arwani PRANADJAYA (62) 21 2557 1129 apranadjaya@kimeng.co.id Technicals

VIETNAM
Michael Kokalari, CFA Head of Research +84 838 38 66 47 michael.kokalari@kimeng.com.vn Strategy Nguyen Thi Ngan Tuyen +84 844 55 58 88 x 8081 tuyen.nguyen@kimeng.com.vn Confectionary and Beverage Oil and Gas Ngo Bich Van +84 844 55 58 88 x 8084 van.ngo@kimeng.com.vn Banking Insurance Nguyen Quang Duy +84 844 55 58 88 x 8082 duy.nguyenquang@kimeng.com.vn Resources Property Trinh Thi Ngoc Diep +84 444 55 58 88 x 8208 diep.trinh@kimeng.com.vn Property & Construction Power Dang Thi Kim Thoa +84 844 55 58 88 x 8083 thoa.dang@kimeng.com.vn Consumer & Services Technology & Telecom Nguyen Trung Hoa +84 844 55 58 88 Pharmaceutical Fishery

INDIA
Jigar SHAH Head of Research (91) 22 6623 2601 jigar@kimeng.co.in Oil & Gas Automobile Cement Anubhav GUPTA (91) 22 6623 2605 anubhav@kimeng.co.in Metal & Mining Capital goods Property Ganesh RAM (91) 226623 2607 ganeshram@kimeng.co.in Telecom Contractor

ECONOMICS
Suhaimi ILIAS Chief Economist (603) 2297 8682 suhaimi_ilias@maybank-ib.com Luz LORENZO Economist (63) 2 849 8836 luz_lorenzo@maybank-atrke.com Philippines Indonesia

REGIONAL
THAM Mun Hon (852) 2268 0630 thammunhon@kimeng.com.hk Regional Strategist ONG Seng Yeow (852) 2268 0644 ongsengyeow@maybank-ke.com.sg Regional Products & Planning

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India Property
Definition of Ratings
Maybank Kim Eng Research uses the following rating system: BUY HOLD SELL Total return is expected to be above 15% in the next 12 months Total return is expected to be between -15% to +15% in the next 12 months Total return is expected to be below -15% in the next 12 months

Applicability of Ratings
The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies.

Some common terms abbreviated in this report (where they appear):

Adex = Advertising Expenditure BV = Book Value CAGR = Compounded Annual Growth Rate Capex = Capital Expenditure CY = Calendar Year DCF = Discounted Cashflow DPS = Dividend Per Share EBIT = Earnings Before Interest And Tax EBITDA = EBIT, Depreciation And Amortisation EPS = Earnings Per Share EV = Enterprise Value FCF = Free Cashflow FV = Fair Value FY = Financial Year FYE = Financial Year End MoM = Month-On-Month NAV = Net Asset Value NTA = Net Tangible Asset P = Price P.A. = Per Annum PAT = Profit After Tax PBT = Profit Before Tax PE = Price Earnings PEG = PE Ratio To Growth PER = PE Ratio QoQ = Quarter-On-Quarter ROA = Return On Asset ROE = Return On Equity ROSF = Return On Shareholders Funds WACC = Weighted Average Cost Of Capital YoY = Year-On-Year YTD = Year-To-Date

APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLOSURES AND DISCLAIMERS

This report, and any electronic access to it, is restricted to and intended only for clients of Maybank Kim Eng Research Pte. Ltd. ("Maybank KERPL") or a related entity to KER (as the case may be) who are institutional investors (for the purposes of both the Singapore Securities and Futures Act (SFA) and the Singapore Financial Advisers Act (FAA)) and who are allowed access thereto (each an "Authorised Person") and is subject to the terms and disclaimers below. IF YOU ARE NOT AN AUTHORISED PERSON OR DO NOT AGREE TO BE BOUND BY THE TERMS AND DISCLAIMERS SET OUT BELOW, YOU SHOULD DISREGARD THIS REPORT IN ITS ENTIRETY AND LET KER OR ITS RELATED ENTITY (AS RELEVANT) KNOW THAT YOU NO LONGER WISH TO RECEIVE SUCH REPORTS. This report provides information and opinions as reference resource only. This report is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. It is not to be construed as a solicitation or an offer to buy or sell any securities or related financial products. The information and commentaries are also not meant to be endorsements or offerings of any securities, options, stocks or other investment vehicles. The report has been prepared without regard to the individual financial circumstances, needs or objectives of persons who receive it. The securities discussed in this report may not be suitable for all investors. Readers should not rely on any of the information herein as authoritative or substitute for the exercise of their own skill and judgment in making any investment or other decision. Readers should independently evaluate particular investments and strategies, and are encouraged to seek the advice of a financial adviser before making any investment or entering into any transaction in relation to the securities mentioned in this report. The appropriateness of any particular investment or strategy whether opined on or referred to in this report or otherwise will depend on an investors individual circumstances and objectives and should be confirmed by such investor with his advisers independently before adoption or implementation (either as is or varied). You agree that any and all use of this report which you make, is solely at your own risk and without any recourse whatsoever to KER, its related and affiliate companies and/or their employees. You understand that you are using this report AT YOUR OWN RISK. This report is being disseminated to or allowed access by Authorised Persons in their respective jurisdictions by the Maybank Kim Eng affiliated entity/entities operating and carrying on business as a securities dealer or financial adviser in that jurisdiction (collectively or individually, as the context requires, "Maybank Kim Eng") which has, vis--vis a relevant Authorised Person, approved of, and is solely responsible in that jurisdiction for, the contents of this publication in that jurisdiction. Maybank Kim Eng, its related and affiliate companies and/or their employees may have investments in securities or derivatives of securities of companies mentioned in this report, and may trade them in ways different from those discussed in this report. Derivatives may be issued by Maybank Kim Eng its related companies or associated/affiliated persons. 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The reader acknowledges and agrees that this report contains information, photographs, graphics, text, images, logos, icons, typefaces, and/or other material (collectively Content) protected by copyrights, trademarks, or other proprietary rights, and that these rights are valid and protected in all forms, media, and technologies existing now or hereinafter developed. The Content is the property of Maybank Kim Eng or that of third party providers of content or licensors. The compilation (meaning the collection, arrangement, and assembly) of all content on this report is the exclusive property of Maybank Kim Eng and is protected by Singapore and international copyright laws. The reader may not copy, modify, remove, delete, augment, add to, publish, transmit, participate in the transfer, license or sale of, create derivative works from, or in any way exploit any of the Content, in whole or in part, except as specifically permitted herein. 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India Property

Maybank Investment Bank Berhad (A Participating Organisation of Bursa Malaysia Securities Berhad) 33rd Floor, Menara Maybank, 100 Jalan Tun Perak, 50050 Kuala Lumpur Tel: (603) 2059 1888; Fax: (603) 2078 4194 Stockbroking Business: Level 8, Tower C, Dataran Maybank, No.1, Jalan Maarof 59000 Kuala Lumpur Tel: (603) 2297 8888 Fax: (603) 2282 5136

Malaysia

Maybank Kim Eng Securities Pte Ltd Maybank Kim Eng Research Pte Ltd 9 Temasek Boulevard #39-00 Suntec Tower 2 Singapore 038989 Tel: (65) 6336 9090 Fax: (65) 6339 6003

Singapore

London

Maybank Kim Eng Securities (London) Ltd 6/F, 20 St. Dunstans Hill London EC3R 8HY, UK Tel: (44) 20 7621 9298 Dealers Tel: (44) 20 7626 2828 Fax: (44) 20 7283 6674

New York

Maybank Kim Eng Securities USA Inc 777 Third Avenue, 21st Floor New York, NY 10017, U.S.A. Tel: (212) 688 8886 Fax: (212) 688 3500

Hong Kong

Kim Eng Securities (HK) Ltd Level 30, Three Pacific Place, 1 Queens Road East, Hong Kong Tel: (852) 2268 0800 Fax: (852) 2877 0104

PT Kim Eng Securities Plaza Bapindo Citibank Tower 17th Floor Jl Jend. Sudirman Kav. 54-55 Jakarta 12190, Indonesia Tel: (62) 21 2557 1188 Fax: (62) 21 2557 1189

Indonesia

India

Kim Eng Securities India Pvt Ltd 2nd Floor, The International 16, Maharishi Karve Road, Churchgate Station, Mumbai City - 400 020, India Tel: (91).22.6623.2600 Fax: (91).22.6623.2604

Philippines

Maybank ATR Kim Eng Securities Inc. 17/F, Tower One & Exchange Plaza Ayala Triangle, Ayala Avenue Makati City, Philippines 1200 Tel: (63) 2 849 8888 Fax: (63) 2 848 5738

Maybank Kim Eng Securities (Thailand) Public Company Limited 999/9 The Offices at Central World, 20th - 21st Floor, Rama 1 Road Pathumwan, Bangkok 10330, Thailand Tel: (66) 2 658 6817 (sales) Tel: (66) 2 658 6801 (research)

Thailand

Vietnam

In association with

Saudi Arabia
In association with

Kim Eng Vietnam Securities Company 1st Floor, 255 Tran Hung Dao St. District 1 Ho Chi Minh City, Vietnam Tel : (84) 838 38 66 36 Fax : (84) 838 38 66 39

Anfaal Capital Villa 47, Tujjar Jeddah Prince Mohammed bin Abdulaziz Street P.O. Box 126575 Jeddah 21352 Tel: (966) 2 6068686 Fax: (966) 26068787

South Asia Sales Trading

Connie TAN connie@maybank-ke.com.sg Tel: (65) 6333 5775 US Toll Free: 1 866 406 7447

North Asia Sales Trading

Eddie LAU eddielau@kimeng.com.hk Tel: (852) 2268 0800 US Toll Free: 1 866 598 2267

www.maybank-ke.com | www.kimengresearch.com

APPENDIX I
Additional information on mentioned securities is available on request. Jurisdiction Specific Additional Disclaimers: THIS RESEARCH REPORT IS STRICTLY CONFIDENTIAL TO THE RECIPIENT, MAY NOT BE DISTRIBUTED TO THE PRESS OR OTHER MEDIA, AND MAY NOT BE REPRODUCED IN ANY FORM AND MAY NOT BE TAKEN OR TRANSMITTED INTO THE REPUBLIC OF KOREA, OR PROVIDED OR TRANSMITTED TO ANY KOREAN PERSON. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF SECURITIES LAWS IN THE REPUBLIC OF KOREA. BY ACCEPTING THIS REPORT, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. THIS RESEARCH REPORT IS STRICTLY CONFIDENTIAL TO THE RECIPIENT, MAY NOT BE DISTRIBUTED TO THE PRESS OR OTHER MEDIA, AND MAY NOT BE REPRODUCED IN ANY FORM AND MAY NOT BE TAKEN OR TRANSMITTED INTO MALAYSIA OR PROVIDED OR TRANSMITTED TO ANY MALAYSIAN PERSON. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF SECURITIES LAWS IN MALAYSIA. BY ACCEPTING THIS REPORT, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply if the reader is receiving or accessing this report in or from other than Singapore. As of 12 April 2012, Maybank Kim Eng Research Pte. Ltd. and the covering analyst do not have any interest in any company covered in the report.

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