2013-01-15 P8A SG (DBS Vickers) (REG) Post Conference Notes - A Friendlier 2013

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BS Vickers Research (Singapore) Pte Ltd

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Refer to important disclosures at the end of this report
ed: SGC/OY / sa: TW

Regional Equity Strategist
Joanne Goh (65) 6878 5233
joannegohsc@dbs.com

DBSVickers regional research team

Fig. 1: Top 10 companies with strong interest
EPS
CAGR
Price Mkt Cap Target FY13 FY12-14
10-Jan-13 US$m Price PE (x) (%) Rating
1
Wing Tai Holdings Ltd S$ 2.08 1,332 . 3.2y
2
Central Pattana Bt 82.25 5,813 90.00 33.6 19 Buy
3
Charoen Pokphand Foods Bt 33.25 8,540 42.00 13.6 66 Buy
4
Quality Houses Bt 2.48 642 3.00 11.5 24 Buy
5
UEM Land RM 2.10 3,004 2.10 23.5 12 Hold
6
Evergrande Real Estate HK$
4.52 8,741 4.70 5.7 22 Buy
7
Religare Health Trust S$ 0.90 580 0.97 4.4* na Buy
8
Far East Hospitality Trust S$ 0.985 1,292 1.09 6.0* 5* Buy
9
Thai Union Frozen Products Bt 71.25 2,700 91.00 12.6 28 Buy
10
Ascendas Hospitality Trust S$ 0.97 638 0.98 4.3* na Buy

Source: DBSVickers
* FY13 Dividend Yield and DPU CAGR 12-14
Fig. 2: MSCI FEXJ net % of companies with upward
revisions upgrades can be expected
-80
-60
-40
-20
0
20
40
00 01 02 03 04 05 06 07 08 09 10 11 12
(%)

Source: IBES, Datastream
Fig. 3: Wide Asia earnings yield gap over US bond yield
provides room for PE expansion rally is sustainable
0
1
2
3
4
5
6
7
8
9
10
02 03 04 05 06 07 08 09 10 11 12 13
(%)
Equity is
cheap
Equity is
expensive

Source: IBES, Datastream. Dotted proforma yield gap when US 10 year
DBS Group Research . Equity 14 Jan 2013
Regional Market Focus
Post Conference Notes

A friendlier 2013

3,000 meeting requests from 400 clients for 84
companies concluded the successful 3-day Pulse of
Asia conference held in Singapore
Property companies made up close to 40% of
companies which were showcased; investor
interest remain strong in Asia property companies
Guidance from companies were generally upbeat,
seeing 2013 as a friendlier environment; concerns
over tighter labor and rising labor costs were
frequently raised
Industrials and consumer companies likely to see
earnings upgrades

Property companies continued to be driven by positive
domestic economy and low interest rates. There was
enthusiastic attendance at meetings with property
companies. We believe the positive domestic sentiment
and low interest rate environment will continue to
support sector interest with an asset reflation theme.

Guidance from industrials and consumer companies
were generally upbeat. Most companies have capex
plans but are prudent in assessing business
opportunities. Costing pressure will come mainly from
rising labor costs; raw material costs are generally not an
issue.

Exceptionally strong Interest in Thai companies. Thai
companies accounted for three out of five companies
that attracted the strongest interest at the conference.
Thailands transport minister gave a detailed
presentation on Thai infrastructure projects. These
projects are likely to drive growth in Thailand over the
next few years. We have an Overweight weighting for
Thailand.

Earnings and forecasts may be raised following positive
guidance. We had upgraded Tat Hong following the
conference.

Key themes for 1H13: 1) Buy Thailand; 2) TIP property
sector will outperform in 1H; 3) current rally is
sustainable premised on potential for earnings upgrades,
especially industrial and consumer stocks.
foosuanyee@imci.sg FooSuan Yee 05/23/14 06:06:11 AM IMC INVESTMENTS PTE. LTD.


Page 2

Key interests in Property and Thailand

We featured a record number of 84 companies from
Singapore, Malaysia, Hong Kong, China, Korea, Indonesia,
Thailand and Philippines in the DBSV Pulse of Asia Conference
last week. There were 3,000 meeting requests from 400
clients. The attendance is one of the highest in recent years
with a median average of 32 meetings for each company.

Interest is strong across the board particularly in the property
sector and Thai market. Interest in ASEAN remains strong
despite investment focus having turned toward the North Asia
markets.

Property companies made up close to 40% of companies
which were showcased. Interest in the sector continued to be
driven by strong domestic economies and low domestic as well
as global interest rates, which are driving asset reflation.

Singapore kicks off the reporting season this week starting
with the REITs, resulting in fewer REITS attending our
conference. Clients were mostly interested in residential
developer Wing Tai, wanting to know the impact of the
governments repeated attempts to cool down the red hot
property sector. Indeed, over the weekend, the government
had introduced more property control measures. However, we
see this as a pre-emptive move to avoid further price
speculation and advice prudence before the white paper on
population is released. Concerns over a slower Singapore
economy potentially affecting the Services sector, especially
Hotels, also saw strong interest towards hospitality REITs.
Investors should look for stocks that could deliver earnings-
accretive acquisitions now that dividend yield gaps have
compressed.

There was also strong interest in Thai, Indonesia, the
Philippines, Malaysia and China property firms.

Wage costs rising but raw material costs were generally stable.
There were concerns over rising wage pressure in most Asian
markets amid regulations to raise minimum wage (Thailand,
Indonesia, Malaysia) and tightening labor markets (Singapore,
China). Labor-intensive sectors like plantations, ports, and
shipbuilding in China, are likely to see higher wage pressure.
However, companies are benefiting from stable or falling raw
material costs, although some may not feel the benefit until
2H. CP Foods may be one of the cheapest consumer stocks in
the region after the sharp price correction last year, but
earnings is expected to turnaround only in 2H.

Highlights in Oil & Gas sector

Among the eclectic list of industrials, most gave positive
guidance with many in expansion mode, adding capacity in
anticipation of stronger volumes as the global environment
improves. Companies with scalable businesses, such as those
in the oil & gas sector, are likely to benefit the most from this
modest recovery. We also raised earnings for Tat Hong after
the conference as its crane rental business is reaping higher
margins in the oil & gas segment.

Asia regional markets: Negative real rates boosting Asset
inflation

Source: Datastream, DBS. real rate: Saving rate minus Inflation
We also hosted more than 100 participants in our
presentations on the Philippines, China and Thailand markets.

Philippines. The market had risen in a straight line over the
past four years, but the speaker highlighted some risks during
the lunch presentation titled What can turn sour?. In our
view, the top down picture still looks strong for the Philippines
as its external balance is one of the strongest among ASEAN
countries due to BPOs, which are less volatile than exports, and
OFW remittances. Consumption had been the main growth
driver and will continue to be so, but upside growth surprise
will have to come from successful PPP in infrastructure projects
to justify the lofty valuations.

As it is, we do not see potential for upside surprises in the PPP.
We have initiated Philippine as Neutral and recommend
consumer stocks as main beneficiaries of the strong domestic
economy. Government spending is expected to be strong prior
to the regional elections in the middle of the year.


Page 3
Philippines: Electricity sales growth - economic growth
proxy

China. DBSV is upbeat on China with a forecast Philippines to
cont The challenge imarkets to Among these 2 of our main
concerns are infrastructure and Indeed
some risks of t While the guidance for second half / 2013 is
nothing to write home about companies in general do not
expect second half to be worse than first half. The
environment will be conducive for clearing inventory and filling
up order books as scheduled, with less stress as expected on
Source: Meralco, First metro secs
China. DBS is upbeat on China and has one of the highest
2013 GDP growth forecast on the street at 9%. DBS China
economist, Chris Leung, spoke on the new government
promoting urbanisation in China, which should support the
need for FAI spending to boost headline growth. Urban FAI in
central China has gained prominence.

China: Urbanisation in smaller cities with younger
populations (% of FAI breakdown by region)

Source: CEIC
Thailand. This year, Thailands Minister of Transport presented
on Thailands infrastructure plans for the next 10 years. The
focus is on Dawei deep seaport and industrial estate
development project that is projected to cost US$10.7 bn.
Dawei is at the south-western Thai / Myanmar border. The
industrial estate will include heavy industries such as: steel
mills, oil refineries, petrochemical complex, fertilizer plants,
power plant, and other utility services including cross border
road and rail links with connecting transmission lines, as well
as residential and commercial developments.
Thailand: Potential for fiscal boost in infrastructure
spending with low budget deficit

Source: Datastream, DBS
Key themes for 1H13. In conclusion, our major takeaways from
the conference are the following key themes:-

1) Thai/ Indonesia/ Philippines property should continue to
outperform the region in 1H13
2) Interest in Chinese stocks is still limited to big caps and
property stocks. Conviction in mid caps is still low. We
believe as headline disappointment in China eased,
sentiments are likely to improve. Rally which is supported
by improving confidence is likely to be sustainable and
interest could spread to the mid caps and small caps
names.
3) We are more convicted in our Thai overweight as investor
interests are stronger than expected. The infrastructure
plans are clear and if executed should bring bountiful
benefits to Thailand and the region. Parts of the
infrastructure works have already commenced.
4) Mid caps oil and gas are still expected to outperform.
5) Yield gaps in Singapore REITS are still seen as a relatively
attractive investments
6) Current rally is sustainable given potential for earnings
upgrades, especially with industrial and consumer
stocks
-5
-4
-3
-2
-1
0
1
2
2005 2006 2007 2008 2009 2010 2011 2012
0
1
2
3
4
5
6
Policy rate (R)
Budget deficit (L)
(%) (%)


Page 4
SINGAPORE CORPORATES

CORDLIFE GROUP
(NOT RATED S$0.58; TP: S$0.65; CLGL SP)

Number of clients met >40

Salient points in management presentation
1) Possible acquisition of assets from Australian entity - in
particular assets in India, the Philippines and Indonesia that
could boost revenue by about 35%. Has enough money from
IPO to fund acquisitions. Company operating cashflow is
earmarked for dividend payments.

2) More room to improve penetration rate via education.
Stable growth in Singapore and HK, driven by increasing
penetration. Long term contract with customers for 21 years in
Singapore, and 18 years in HK.

3) Adequately insured - maximum payout S$4m per case; total
insurance premium paid last year about S$50,000 (vs revenue
of S$29m)

Data points and other guidance made:
1) Market share in Singapore currently stands at 70% of
private cord blood bank. Penetration in Singapore of about
28%. Estimated implied growth of about 10-15%.

2) 48% of customers opting to pay 21 yrs; 40% opting for
annual plan; the rest are on 10 year plan. Upfront payment has
been reduced to S$1600 from about S$2000 previously due to
economies of scale. Currently still about S$200 more than
competitors.

3) Cordlife has done eight successful transplants so far, vs
about 120 transplants for Singapore Cord Blood Bank (public
bank).

Three frequently asked questions (and response by
management)
1) What were the reasons for higher market share? Company
believes in accreditation and has done eight transplant vs none
by its competitors. Triple blood system, has six markers in
BIOSAFE bag. It is able to get 97% recovery of stem cells from
cord blood drawn, compared to 87% from normal blood
recovery system. It has also has put more effort into marketing.

2) Public vs private. Why do for public if private is free?
Singapore Cord Blood Bank has a target inventory of 10k cord
blood units, so it will discard some if the ethnic match is
common. Cord blood may not be available to donors when it is
needed years down the road. The company is educating clients
on this point.

3) Risks on contracts? The company is not liable for force
majeure events, such as natural disasters. It is also not liable for
cord blood that has been contaminated during collection and
not suitable for storage. It will only provide refunds. It is liable
for the matching of cord blood, or payment of up to
US$25,000. Professional indemnity of up to S$4m payout, as
per other healthcare players, such as Parkway, Raffles Medical.

4) What is the lifespan of the stem cells collected?
There are different studies done and results vary as the oldest
cord blood bank is probably <50 yrs. So far studies have shown
that the cells stored are still viable and some studies even
predict a lifespan of 1000 yrs!

5) How are revenues recognised?
Those clients who paid up front are recognised on a deferred
basis while those on an annual payment scheme are
recognised based on a discounted cashflow basis (discount rate
10%)

We do not cover this counter. Non-rated.



Page 5
COSCO CORPORATION
(FULLY VALUED; S$0.985; TP: S$0.80;
COS SP)

Number of clients met: 17

Salient Points in Management Presentation:
1. Offshore enquiries remain healthy

2. Cosco has scaled up and has improved on project execution.

3. Offshore remains the bright spot while the shipbuilding
outlook is still challenging

Data-points and other guidance made:
1. New order wins target will be announced in Feb. Probably
will be similar to US$2bn achieved last year.

2. Gross margins for offshore is expected to hover around 10%
on average.

management)
1. Outlook for new orders
- Cosco will focus on offshore orders in the coming two years
and expect stable demand from this segment. Shipbuilding
orders may improve slightly from 2012 but remain sluggish as
supply is abundant in spite of declining bulk carrier deliveries in
2013.

2. Cancellation or rescheduling risk
- most of the shipowners are looking to take deliveries on
schedule except a couple of units that have been postponed
from Dec to Jan, which is the industry norm.

3. Inflationary cost pressure
- Steel cost will likely be rather stable and labour cost may
increase in single digits only

CWT (NOT RATED; S$1.26; CWT SP)


1. The majority of CWTs commodity supply chain
management business (80% of 9M12 revenue) is related to
copper, lead and zinc concentrates. The group is also looking
to expand into refined metals, diesel, gasoline, naphtha, coal
and iron ore.
2. The profits from commodity trading come from (a) sourcing
(e.g. buying copper from the mines) (b) logistics/freight (i.e.
finding the cheapest way to transport the commodity from the
mine to a port) (3) onshore logistics (e.g. finding the lowest tax
bracket on which to import the commodity, finding the best
location in which it can deliver the goods to its customers).
CWTs historical strength has been onshore as it has secured
exclusive access to critical ports or delivery points.

3.CWTs freight logistics arm (7% of 9M12 revenues) is the
third largest LCL (less than container load) consolidator for sea
freight. This business is involved in the collection of smaller
parcels from various freight forwarders and consolidating the
volumes for the larger logistics players such as DHL and DB
Schenker.

1. CWT will have over 11.1m square feet of warehouse space
under management by 2014.

2. The group trades about 1.4m MT of base metals with 2m
MT target near term.

3. The group has about US$1.2bn of uncommitted lines, 50-
60% of which has been utilised.

management)
1. Does CWT intend to sell more of its warehouses? The group
will only sell when it requires cash to construct a new
warehouse. For example Pandan Logistics Hub was sold in
2012 to fund the construction of CWT Cold Hub 2 and the
expansion of Toh Guan Road East.

2. How does CWT manage the commodity price risk in its
supply chain manager business? CWT notes that it does not
take on price risks. This is achieved by entering into a futures
contract when it sources the supply of copper concentrate.
When it finds a customer for the concentrate, it then enters
into another futures contract to hedge against any price risks.
This is required by the banks that provide financing to CWT.


Page 6
60% of the hedging is conducted by the banks themselves,
with the remaining 40% down by CWT with documented
proof to the banks.

3. Would CWT be interested in expanding to Johor, Malaysia?
CWT is not interested as there is only a 10% cost (consisting of
warehousing, labour and freight) differential to Singapore. In
addition the group is also concerned about the freight volumes
available there.

DEL MONTE PACIFIC LIMITED
(NOT RATED ; S$0.685; DELM SP)

Number of clients met: c. 30

1) Its focus is on packaged beverages vs concentrates, and
fresh fruits vs contract pack for fruits.

2) 75% dividend payout maintained.

3) It shared its long-term optimism. Five main points by 2015,
including termination of supply contract in Nov 2014, change
in pricing model for fresh pineapple contract, and expiration of
toll contract with San Miguel that has lower margins.

1) Branded accounts for 70% of business vs 30% of OEM.

2) General trade of 70%. Penetrate over 90k stores out of
500k. Relevant stores would be about 150k sari sari stores.

management)
1) The reason for sales decline in 2009? It had problems with
pineapples. I tried using outgrowers programme but the
tonnage declined. 95% of pineapples are produced internally.

2) Capex? c.25m per year.

3) Biggest competitor? Dole is the largest competitor overall,
and Del Monte in Asia. Heinz in the Philippines for the culinary
segment.

Recommendation: we do not cover the stock currently.



Page 7
EZION HOLDINGS
(BUY S$1.88; TP: S$2.12; EZION SP)

Number of clients met: 27 (half day of meetings)

1. Expect robust demand for their liftboats/service rigs to
persist over the next five years at least, driven by the need for
platform maintenance.

2. Focus on maintenance phase of oil field lifecycle, less
volatility in oil companies budget in this segment.

3. Strategy going forward need to balance project portfolio
of liftboats (higher margins, ROE, but longer gestation period)
vs refurbished service rig projects (lower margins, ROE, but
quicker time-to-market); also depends on what customers
require at the end of the day.

1. Ratio of offshore platforms to liftboats in Asia Pacific.

2. Age profile of offshore platforms.

management)
1. What do the new strategic shareholders bring to the table?
Tan Boy Tee brings years of experience and his industry
network as founder/CEO of Labroy, as well as his ability to co-
fund the equity portion of future potential projects. EDBI is
more of an endorsement of Ezions niche and first-mover
advantage in the liftboat space in Asia Pacific, which has the
potential to set a new industry standard for platform
maintenance in the sector. Ezion hopes EDBI's presence will
help open doors to two Asian-based national oil companies for
which EDBI has existing traction with.

2. Is Ezion likely to raise equity capital in the foreseeable
future?
Will not do so for general fund raising purposes management
is very adverse to dilution of existing common shareholders,
unless it spots compelling acquisition/projects (e.g. earnings
accretive or good business at bombed out valuations) that
require funding.

EZRA HOLDINGS
(BUY (UR) S$1.325; TP: S$1.30 (UR); EZRA SP)


1. Sees no slowdown in subsea market; strong offshore activity
levels as clients continue to push out new projects

2. Full subsea fleet will be able to address the entire spectrum
of deepwater subsea construction projects

3. Day rates for large AHTS have been inching up; expect them
to strengthen significantly in 2H 2013

1. Tender book for subsea projects currently stands at
~US$4bn; 30% historical hit rate

2. Subsea fleet utilisation rate to be much improved y-o-y;
towards high 70s/low 80s

management)
1. Administration cost trend: Management guides that most
of the hiring required for the combined Ezra-AMC group
hasbeen done, just another team of 100 people are needed to
support the operations of Lewek Constellation subsea vessel
when it is delivered in 2014

2. What is the current subsea orderbook, and how much is to
be recognized over FY13/14?
Currently at ~US$900m, most (60-70%) to be booked in FY13;
remainder in FY14-16



Page 8
FAR EAST HOSPITALITY TRUST
(BUY S$0.985; TP: S$1.09; FEHT SP)

Number of clients met: >30

1. Management advocates their medium term positive view on
the sector given the opening of various attractions (West Zone)
and River Safari underpinning growth in the sector for 2013. It
believes that demand will continue to outstrip supply and
occupancy will remain high at 85pct.

2. Asset refurbishment plans on track. Post refurbishment rates
are in excess of 5-10pct portfolio wide. Refurbishments will
complete by end of 1Q13.

3. Its acquisition pipeline is one of the strongest amongst peers
which is likely to be ready to make acquisitions within the next
18 months. Prior to that, in the immediate term the group has
signed a non-binding MOU with Straits Trading to acquire
Grand Rendezvous Singapore

Data-points and other guidance made in response to
questions:
1. Demand for rooms have remained fairly weak in Jan13 given
that the corporate market has yet to start fixing meetings and
start traveling before the Chinese New Year but Feb is likely to
be a good month. Corporates rates are signed in excess of 5pct
growth y-o-y. It has receive positive feedback from refurbished
rooms in Orchard Parade Hotel and the Landmark Hotel and it
has been able to sign an increased number of large corporate
deals for it.

2. Funding of Grand Rendezvous Hotel not decided yet but
could need new equity given its size. However, management
remains confident that it will be an accretive deal. Gearing
target of between 30-35pct.

3. Its serviced residence portfolio is seeing some weakness, due
to weaker demand from the financial sector but it is not
significant. Occupancy is expected to remain above 80pct.
However, booking visibility is getting shorter (lesser than one
year leases), more of three to six months rolling, thus its ability
to raise rates is limited but still positive

We have a buy call with TP 1.09. Potential upside coming from
acquisitions not factored in at this moment

GOLDEN AGRI RESOURCES
(NOT RATED S$0.66; TP: S$0.71; GGR SP)

Number of clients met: c.40

1. The group revealed that the 16k ha planted oil palm estates
it had acquired (announced 21 Dec12) has an average age of
13 years. The group purchased this asset from a large group
that they had declined to disclose. The acquisition price was
US$11,100/ha. GGR also revealed that US$220m of further
investment in Verdant Fund LP was for an acquisition of c.17k
ha of planted land, which was part of the land acquired in
point 1. The rationale: The fund was initially formed to
develop a c.200k ha concession in Liberia for which GGR had
invested US$50m. The total investment cost needed for this is
US$1.5bn; but so far there are no other investors in the fund.
Hence, to help attract other investors for Verdant Fund LP, it
was injected with this asset. At this point GGR has yet to
provide further information regarding the terms and conditions
of its investment in Verdant Fund LP. According to GGR,
Verdant Fund is run by an ex-McKinsey professional manager.

2. The fund raising exercise through CB was primarily on the
cost consideration (i.e. 2.5% vs. 7-8% through straight bonds).
It was revealed that it did not employ bank loans because it
had hit the banks' legal lending limit. The group will utilise
proceeds from warrants exercise this year (c.US$300m) as well
as through various fund raising efforts (including US$400m CB
and RM1.5bn Sukuk) for refinancing and M&A opportunities.

3. The group is looking into further investments for the
upstream (c.15% IRR) and downstream (c.20% IRR). It is
considering further acquisitions in Indonesia as well as refining
capacity in India. In India, it will form a partnership with a local
entity; and is looking at opportunities in Southern India. The
investment amount and capacity will still depend on whom it
chooses to partner with; and currently it is in talks with various
parties.

1. Capex will remain at between US$400m and US$500m;
dividend payout will go back to 20-30%

2. Expansion target remains 20-30k ha (c.20k ha of which is
organic). The group will continue to pursue acquisitions of 10-
15k ha this year. There is a higher likelihood that own planting
will reach 20k ha this year (realised expansion over the past
two years is 10-15k ha); as the group had made adjustments to
the changing regulatory environment and higher compensation


Page 9
demands over the past two years; such as allocating more
resources to areas of expansions and better socialisation.

3. Cost to maturity is US$7k/ha over three years (inclusive of
the mill, which is approximately US$1,500/ha).

management)
1. Are there cost pressures going forward?
The group expects its cash cost of production/MT to increase
by c.5% y-o-y this year (from around US$300/MT last year),
taking into account the various increases in minimum wages
throughout Indonesia. It had undertaken a cost analysis impact
and found that the hectarage-weighted labour cost increase
would be 15% this year, or approximately 5% higher than
normal. Labour cost accounts for approximately 45% of the
group's overall cost; while fertiliser cost accounts for 30%. It
expects fertiliser cost to increase by less than 5% this year
(after imputing that CPO output will grow at the lower end of
5-10% range this year).

2. What is the group's outlook on CPO price (inventory
situation)?
The current weakness is mostly coming from China, as the
substitution from soybean oil is not happening. This was
because China had a significant soybean meal requirement and
was therefore heavily importing soybeans - thus creating ample
supplies of soybean oil. However, GGR believes this is
temporary and expects the CPO price to rebound to a more
sustainable level of c.US$1,000/MT (perhaps as soon as 1Q13),
as inventory levels normalise (i.e. to below 2m MT in Malaysia,
quoting Oil World). This is based on expectations that 1Q13
production will seasonally drop and exports to continue to
remain strong. According to the company, CPO prices have
hovered around US$1,000/MT over the past two years and
fundamentals have not changed much. Unless the CPO prices
drop to US$500/MT, the group will continue to focus on
improving its output and expand organically as well as
inorganically. GGR expects to sell more inventory in 1Q13 (as
its strategy to hold stock in 3Q12 backfired).

3. Why has operations in China incurred losses and what is the
4Q12 outlook?
High input cost, combined with restrictions on domestic
cooking oil prices made worse by shadow financing. 4Q12
situation should improve because soybean prices have
declined; and as inflation has eased, there should be less
tightening (therefore less shadow financing). They expect no
operational differences with Wilmar.

This counter is not covered; but we have a fair value estimate
of S$0.71 (excluding new 16k ha of planted land acquisition).
Will share amended fair once data is imputed.



Page 10
GOODPACK
(HOLD; S$1.89; TP: S$1.95; GPACK SP)


1.Goodpack intends to grow its revenue in excess of US$300m
(FY12 US$177m). This will come from increased penetration
of existing customers, growth in existing markets and
expansion into the automotive sector.

2. Given its strong balance sheet, for new IBCs (intermediate
bulk containers), 50% will be leased with the remainder being
owned. Goodpack may also look to buy the IBC's that it is
currently leasing from the banks.

3. Goodpack is targeting a 10-15% marketshare in automotive
parts over the next five years. This will drive Goodpack's
medium-term growth outlook.

1. Current utilisation stands at 58% up from 56% last year.
The target is to reach 60% with a potential maximum
utilisation rate of between 65-70%

2. Automotive parts are only expected to contribute 2% of
FY13 profits.

3. Each IBC currently costs US$250

management)
1. What are the competing transport solutions? The main
competition are wooden boxes/pallets and corrugated boxes.
There are also some providers of steel and plastic boxes.
Goodpack's steel IBC's have an advantage compared to
wooden boxes as there is no risk of wooden contaminants. For
corrugated boxes and plastic boxes, steel IBC's have a higher
carrying capacity. Goodpack also has the advantage of a global
network that other steel box companies do not have.
2. What is the current margin outlook? Goodpack expects
variable costs as a percentage of revenue to remain stable.
3. What is the difference between Goodpacks and Brambles
business models?

Management explained that Brambles primary business is the
leasing of pallets for FMCG (fast moving consumer goods) with
a domestic focus. Goodpack in contrast is mainly involved in
the international movement of rubber and automotive parts.

HUTCHISON PORT HOLDINGS TRUST
(BUY; US$0.82; TP US$0.88; HPHT SP)


1. Expect c. 5% throughput volume growth in 2013, driven
mainly by higher transshipment and intra-Asia volumes. Europe
remains worrying whilst some signs of a mild US recovery

2. Cost pressures will mainly come from higher labour costs
(+10% y-o-y in PRC and +5% y-o-y in HK), as well as a slightly
higher tax rate (effective 16% in 2013) and higher interest
costs (on refinancing of existing loans and more debt to fund
capex).

3. ASPs to move 2%-3% higher, more or less in line with
inflation.

1. HK$3.5bn more in capex to be spent (HK$1bn spent so far)
on Westport Phase 2 over 2013 to 2015, which will be roughly
evenly distributed. Total capex for 2013 estimated at HK$1.5bn
(including recurring/maintenance capex), funded by debt

2. Can make DPU guidance as per prospectus (US 6.6cts) due
to capex deferral but as 2013 will see significant capex, DPU is
likely to be lower (already previously guided to the market).

management)
Frequently asked questions mainly revolve around the above
key points.

Our take
Nothing too surprising said by HPHT. The trust's prospects are
largely determined by the macro-economic environment, and
should see some core earnings improvement on a slightly
improved world outlook in 2013 and stronger China growth.
Although we expect DPU to decline in FY13 as its capex plans
resumes, the dividend yield of over 7.5% is attractive in our
view



Page 11
JARDINE CYCLE & CARRIAGE
(NOT RATED; S$48.68; JCNC SP)


1.JCC believes low cost green (LCG) cars in Indonesia will be
more headline grabbing than actually resulting in a substantial
boost to profits. This is because of the low price point and low
profitability of these cars. LCG may also boost headline Astras
marketshare data. In addition there is a risk of the LCG cars
cannabilising sales of cars at the higher price points. While
Astra will have the first mover advantage, other Japanese car
makers also have models at the lower price point.

2. Vietnamese business has suffered from high inflation and
political instability over last few years. Sales were down 30% y-
o-y. JCC does not expect the situation to improve anytime
soon.

3. The heavy equipment business (United Tractors) has not
been good as low coal prices triggered coal miners to curtail
investment in new equipment. The business was also impacted
by price discounting. This resulted from an oversupply of
equipment (mainly Hitachi) in China being sent to Indonesia. In
addition the coal miners have reduced strip ratios which
impacted the contract mining business. Currently operating
conditions are ok but there has not been any improvement.

1. The group spends about US$0.5bn on replacement/new
equipment for its contract mining business and own mines.

2. NPLs in the vehicle finance business should improve given
the imposition of 20% down payment for new car purchases
last year.

management)
1.Do you see any new competitive threats in the Indonesian
automotive space? The group does not see any significant
threats near term given the groups advantage from having a
large distribution network and local assembly/manufacturing.
The South Korean manufacturers such as Hyundai and Kia are
trying to enter the market but as they dont have local
production it is hard for the company to gain scale to compete
effectively against Astra. In addition the strong growth by
Honda last year should not be a concern as Honda was severely
impacted by the Thai floods the previous year.

2.Is there any risk of oversupply given increases in 4W
production capacity in Indonesia? JCC notes that some of its
competitors are increasing production by 10-20% but believes
there should be sufficient demand to absorb the increase. Mr
Chiew (the CFO) however would be nervous if everyone
expanded aggressively.

3.What are JCCs growth plans? The group will continue to
invest mainly in its Indonesian automotive business. They are
also looking at automotive opportunities in the Philippines.



Page 12
RAFFLES MEDICAL
(HOLD S$2.89; TP: S$2.59; RFMD SP)

Number of clients met > 32

1) Revenue CAGR of 16% since 1994, showing strong
performance and relative resilience of the healthcare sector,
even in 1998, 2001, 2003 and 2009.

2) Growth through primary care services, expansion of hospital
in Singapore. Submitted tender for greenfield hospital in HK.

3) Hospital expansion expected to start in 2013, subject to
finalisation of plans, with a 24-month timeframe.

1) Still in discussion with authorities on a provisional plan
approval for its proposed specialist medical centre at Thong Sia
building at Orchard. Unsure how long this would take.

2) Bed occupancy still stays at c.50-60%. No guidance on the
outlook. Our sense is it is stable, and we should see a low
teens growth in financial numbers.

3) Corporates account for about 50-60% of Healthcare
services, and one-third of hospitals.

management)
1) How are the doctors compensated and what are their
contract terms? Doctors are on contracts, for about two to
three years. Compensation via salary, profit share and share
options. Profit share based on business division and matrix.
Structured to benefit the group.

2) What percentage of patients are foreign? About one-third
of patients are international patients as Singapore develops its
medical tourism.

3) Funding of expansion. Estimated cost is $80-100m, and met
by internal cash at c.$60m and internal cash flow of c.$40-
50m/ yr.

RELIGARE HEALTH TRUST
(BUY S$0.90; TP: S$0.97; RHT SP)


1) Fortis has been growing 6% q-o-q. During crisis, healthcare
is relatively resilient. Outlook has not changed since the listing.

2) 96% are operational assets and low risks of development
risks. Focused on secondary and tertiary care. Acquired all
assets of fortis in India, except one which is pending litigation.
Acquisitions going forward are likely to be in India.

3) Gurgaon clinical establishment has agreed upon fees. Expect
a ramp up to make up for the expiry of distribution waiver by
FY15. In a worst case scenario, distribution could stay the
same. Expect DPS to have an upside.

1) Hedged at 47.28 for FY14, no significant changes since IPO.

2) Average revenue per bed growth of 7-8% per day guided in
prospectus. Assumed 17-18% revenue growth from Fortis in
model in prospectus.

3) 75% hospital revenue is cash basis, 25% mixture of
insurance, pension funds.

management)
1) What will be the driver to increase bed capacity? Depends
on the occupancy. First 48 hours account for about 80% of
revenue. Depending on needs, it may make increases. Optimal
occupancy is about <80%. Occupancy not based on
seasonality, except for summer months due to as malaria.

2) How much does bed prices increase by? Tends to track
inflation.

3) Rental coverage is 2.6x. Rental on EBITDA cover. Rent as a
percentage of reveneue is about 15%. Fortis matured has
about 27-28% margins. Stabilisation period is about three to
four yrs on average. Shalimar Bagh is about 14 months.

4) Target gearing? Does not envisage going beyond 30-35% in
the long term. Currently the gearing is at 6%.



Page 13
TAT HONG
(BUY S$1.455; TP S$1.80; TAT SP)


1. Growth momentum will continue - management sees
improving demand driven by 1) infrastructure spending in
Singapore, Malaysia, Thailand, and Hong Kong 2) Australia's
O&G projects. Capex plans demonstrates management's
confidence.

2. Crane rental rates and utilisation will be on the uptrend
fuelled by bouyant crane demand. Current rates are still 15%
off its 2008 peak, currently over S$500/month/ton.

3. Competitive advantage will strengthen with the expansion
of bigger tonnage crane units in its coming fleet expansion
plans.

1. Guided sustainable utilisation to be 80%. Targets
FY13F/FY14F utilisation to be 75%/80%. Highest ever recorded
in a single month was 88%. 2Q13 utilisation was 73%.

2. Rental rates have increased 15% for the past 15 months up
till Sept 2012, currently at over S$500/month/ton.

3. Capex is budgeted at S$50-70m for c.40 mobile/crawler
cranes. Tonnage to increase by 10,000 tons.

4. Payback period for an average crane is approximately three
to four years.

management)
1. Competition - Competitors will take longer time to reach
TAT's scale since they have smaller fleet sizes, lower and
limited tonnage range. TAT has higher capacity cranes and a
fleet size that cannot be replicated overnight. TAT's more
robust fleet management ensures it delivers most large
contractors' requirements on a regional basis. Also there are
not many players in the market. TAT is the region's no.1.
Closest competitors are Tiong Woon (fleet size 200), JP Nelson,
Hwa Tiong.

2. Utilisation rates - See data points and guidance

3. Visibility of contracts and contract lengths - Real time
visibility is six months. Rental demand is typically pre-booked
up to six months ahead for an average rental period of three to
six months. Australia's O&G market averages one to one-and-
a-half years in rental period.



Page 14
HK/CHINA CORPORATES

CC LAND
(HOLD HK$3.00; TP: HK$2.00; 1224 HK)

Number of clients signed up: c. 30

1. FY13 is a turnaround year for CC Land from loss making to
profit making. 2. CC Land expects to enter into a stable
growth stage of 20% to 30% per annual growth in both
presales and completion. 3. CC Land took opportunities to buy
land in year-end 2012. The company is looking for
opportunities to enter Xi'an and Kunming in 2013. It had a
project in Kunming, but it has been completed. Therefore, CC
Land is looking for a new project there.

1. FY13 contracted sales target has not been set but should be
at least Rmb8.5bn compared with FY12's over Rmb7bn. 2.
1.5m sm saleable resources in FY13. CC Land's ASP of
residential units may go down slightly to c. Rmb7k/sm from
FY12's c. Rmb8k/sm due to more mass market products, while
commercial portion with a higher ASP may compose a higher
percentage than in FY12. 3. Net debt ratio by end-FY12 is
expected to maintain low at c. 20%.

management)
1. Please give market updates in China especially in Chongqing.
Chengdu market was picking up in 2H12 in general. CC Land
did well in Chengdu due to the rolling over of more mid-end
smaller sized units to meet the end-user demand. Chongqing
has no HPR policy but the market was very weak during Sep
2011-Feb 2012 as buyers were waiting for more policies. After
that, end-user demand started to enter the market when
policies looked stable.

2. Any worries about policy coming back? As affordability in
Chongqing and Chengdu is at a fair level at 6-7x of people's
annual income. There is not much need for further tightening.
We only expect to see 5% to 10% growth in price in 2013
which is acceptable in the government's view.

3. What's the expected margin of the new land acquired in
Nov/Dec 2012? c. 20% based on the current selling price. It
can be higher in later phases when prices go up.

CENTRAL CHINA
(BUY (UR) HK$2.85; TP: HK$2.39 (UR);
832 HK)

Number of clients signed up: c. 30.

1. Central China will continue to focus on county level cities in
FY13. As Henan has been designated as the core of China's
Central Economic Development Zone. Urbanisation progress
will speed up and more investments from the central
government is expected to be in place. Central China's strategy
is consistent with this macro trend.

2. Construction pace may further speed up in FY13. High asset
turn is what the company will continue to focus on. The
projects acquired in FY12 may potentially enter into the pre-
sales pipeline.

3. Cautious positive view on the Henan market driven by
volume growth. ASP could be higher but not
necessarily. Central China will continue to gain market share.

1. Although the company has not set the FY13 sales target yet,
Rmb12bn is a rough estimate which represents around 20% y-
o-y growth based on a Rmb20bn saleable resources and 60%
sales-through rate. Among the saleable resources, around
Rmb13-14bn are new launches.

2. Net debt ratio by end-year 2012 could maintain at a level of
50% to 60%. The company will try to remain the net debt
ratio stable.

management)
1. Any plan to do equity fund raising or debt? It is an option,
but the company needs approval from its major shareholder
(Capitaland) to do any share placement. As Capitaland will be
diluted, it is hard for them to approve the deal. Debt issuance
could be a way to lower its lending cost now. But the company
does not seem to be going down that route.

2. Any potential impact from CB? As CB conversion price is
HK$2.98/share, the current share price has been close to that.
Management plans to wait for a higher price to convert. If it
converts the CB to shares, it could hold over 8% of the


Page 15
company's share. This could be an overhang to the share price
as the CB holder is a PE firm.

3. How to face the competition from newcomers? The stronger
developers will remain strong. Central China is the first
developer in Henan to achieve Rmb10bn contracted sales.
Central China is better positioned to compete in the province
with a larger land bank and ready local teams.

CHINASOFT
(NOT RATED HK$1.81; 354 HK)


1. Urbanisation is +ve to Chinasoft. In the past, it may be
difficult for entrants to enter into certain industries.
Urbanisation creates IT service demand in second and third tier
cities, which is easier for entrants (such as Chinasoft) to tap
into.

2. Government is encouraging industry consolidation (i.e.
reducing # of vendors)

3. Labour cost remains under pressure. Chinasoft will relocate
some staff to the inner part of China.

1. Maintain c.25% revenue growth in the next few years.

2. Current utilisation is 85%.

3. Staff turnover rate in FY12 is similar to that in FY13.



Page 16
EVERGRANDE
(BUY HK$4.52; TP: HK$4.70; 3333 HK)


1. 2013 saleable resources will be c: 26m sm. This may
translate into 161bn, assuming ASP of 6K. DBSV estimate: c.
100bn pre-sales to be achieved, assuming 62% sales rate,
similar to last year.

2. Lowering gearing is still its top priority. Target to lower the
gearing to below 80% by end-13.

3. 2nd Tier city contribution to 2013 pre-sales may increase
from 44% to above 50% as a result of more acquisitions in
Tier 2 cities in 2012. This should help support ASP.


1.It launched 58 new projects in 2012; 2013 new launches
may be >50 2.Mgmt is exploring different funding channel,
such as doing more JV to minimise risk and lower capital
involvement

management)

1. What is the likely pre-sales target for 2013?
2. Has mgmt undertaken any actions to improve market
perception about its corporate governance?
3. What's the plan to lower the gearing other than selling
more?

FORTUNE REIT
(BUY HK$6.40; TP: HK$6.97; 778 HK)

Salient point in mgmt presentation
1) AEI remains one of the growth drivers. AEI at Jubilee Square
is underway. Fortune REIT plans to do another AEI at Ma On
Shan Plaza in 2013 and study the feasibility of AEI for
Belvedere Square.
2) Fortune REIT continues to explore acquisition opportunities.
3) Lease expiry in 2013 will concentrate on Metro Town and
Fortune City One

Data point and other guidance
1) In 9M12, rental reversion was 20.1pc
2) Less than 5 pc of revenue from turnover rent
3) Cost to income ratio should be maintained at 28pc or below

Three FAQs
1) Does Fortune REIT intend to expand outside HK or buy
industrial properties and convert into retail use? No
2) Does Fortune REIT plan to dispose of any asset? No
3) Outlook of retail market? Remain positive



Page 17
FRANSHION
(BUY HK$2.93; TP: HK$3.37; 817 HK)


1.Presales may see 20% growth from 10.4bn achieved in 2012,
but this may include Rmb1.8bn sales carried forward from
Shanghai Shipping Center

2.Changsha sales may further go up to 900mu with higher AV

3.Commercial prop sales contribution to 2013 will drop
substantially to be c. 30% to 35%


1.May still have Rmb 5bn for new land acquisitions in 2013 if
gearing is to stay at below 60%

2.Next acquisition targets are Nanjing, Changsha and
Chongqing

3 Hotel spin-off may not come through until post 2015 as
management plans to grow hotel portfolio further before spin-
off

management)

1. What is the pre-sales target for 2013?
2. Planning for the new Shanghai land acquired in Dec2012?
3. Performance of its office and hotel portfolio?

NETDRAGON WEBSOFT
(BUY (UR) HK$11.52; TP: HK$11.46 (UR);
777 HK)


1. The Online Games segment is fairly mature but growing
steadily and is a good cash cow for the company with c. 42%
operating margin. The company is also taking less risk in this
business - cancelling six of 12 projects, as online gaming
becomes more of a miss than hit business.

2. The company's next focus of growth is on its Mobile Internet,
which has seen its revenue grow at an exponential rate from
less than Rmb1m in 3Q10 to over Rmb86m in 3Q12, and the
growth momentum is expected to continue.
This comes on the back of the total installation base rising from
less than 5m in 3Q10 to nearly 180m in 3Q12.

3. The company has recently announced plans to spin-off its
mobile internet business on HK GEM, which awaits shareholder
approval

1. The Mobile Internet business is expected to continue
growing strongly, and could double or even triple its revenue in
2013 2. The company is the market leader in both the iOS and
Android segments.

management)
1. What is the competitive landscape for Mobile Internet?
NetDragon has a huge lead as China's preferred app
distribution platform and as an experienced player, will be
looking to hold on to this lead. Attempts by hardware players
to lock-in users to their eco-system have generally not worked
out well (especially in China).

2. Dividend policy? The company is in a strong cash position
and is highly cash generative, it has been paying out at least
50% earnings and should continue.

3. Can smartphone penetration rates in China improve further?
There is definitely room for further growth as China's
smartphone penetration rate is only 60% of South Korea
(28% vs 52%) and with lower end smartphones becoming
more readily available (even Apple is rumoured to be
introducing lower end models), smartphone penetration rate
should continue to improve strongly in China, to help underpin
the company's mobile internet business' growth.


Page 18

Our take
Although NDs share price has almost doubled since our
initiation, we still see attractive upside at current valuations
(only 0.23x PEG against 38% 3-year CAGR) and view it as the
best SMC proxy to gain exposure to the mobile internet market.
We lift our SOTP TP by 34% to HK$11.46 on greater mobile
internet earnings contribution, BUY.

SHUI ON LAND
(HOLD HK$3.86; TP: HK$3.56; 272 HK)


1.Residential subscribed sales in FY12 was c. Rmb8.4bn after
including Rmb2.7bn Shanghai RHXC subscribed in Dec. Shui
On Land missed its residential sales target of Rmb10bn mainly
due to slow sales in Chongqing and Dalian.
2. The company has started to put more of its resources into
Shanghai for relocation and construction as the market is
relatively strong. Further launches of Shanghai RHXC will be in
2Q and the following months.
3. Shui On Land earning visibility in 2013 is not low. It has
Rmb6.4bn unbooked sales and Rmb2.7bn subscribed sales by
end-FY12. This means total unbooked sales have been up to
Rmb9bn.

1. Rmb12 to Rmb13bn residential saleable resources with
Rmb5.5bn in Shanghai. This includes Rmb2.7bn have been
subscribed but not contracted in Dec 2012. Enbloc sale of
Rmb6bn to 8bn is under negotiation.
2. Net debt ratio has been lowered after issuing the perpetual
notes. We estimate it may be below 80%.

management)
1. Why was Chongqing sales slow? Shui On Land didn't cut
prices for the Chongqing project. It tried to cut prices in 2008
when the market was difficult, but didn't boost sales
significantly. And it made customers have less confident about
the project. The company decided not to cut price in this round
of market downturn, given the project's luxury nature.

2. Financing plan in 2013? Shui On Land will have two major
debt due in 2013. One is Rmb2.7bn CB puttable in FY13 with
a conversion price of HK$4.5/share. Another one is Rmb3bn
senior notes. Shui On Land may issue new debt to refinance
them.

3. Why did the company choose to issue the perpetual bond?
The action is mainly to manage the company's gearing ratio.
As the perpetual bond will be treated as equity, net debt ratio
can be lowered effectively. In the meanwhile, it is callable in
five years. It gives Shui On Land an option to reduce the debt
in the future.



Page 19
SITC INTERNATIONAL HOLDINGS
(BUY HK$2.68; TP: HK$2.90; 1308 HK)


1. SITC is not just a container liner, but an integrated logistics
player with 60% of earnings coming from land logistics, with a
unique focus on solely Intra-Asia trade. Land logistics include
freight forwarding, ship agency, customs clearance,
warehousing etc. 90% of its land logistics business is related to
its container business.

2. The company's high frequency (>300 weekly services) and
high density model (over 50 routes and 48 ports in Asia),
enables them to offer a product and service that is superior to
most, allowing them to charge higher prices (by a few percent)
whilst customers remain sticky

3. In the longer term, SITC is targeting the third party logistics
(3PL) market in China as another further engine of growth for
the company.

1. The company expects to order another 15 vessels in 1H13,
together with the one confirmed, would receive these in 2014
and 2015. Expected CAPEX in 2013 is US$100m to US$200m,
most of which would be going to deposits for these vessels.

2. Company is targeting 10% volume growth in 2013 with
stable ASPs. Overall margins should hold steady as lower vessel
costs from the 13 owned vessels delivered in 2012 should help
protect margins.

management)
1. Who are SITC's largest clients? SITC has over 10,000 clients
with none exceeding 1% of revenue. Most of SITC's clients are
involved in high value products such as FMCG, chemicals,
apparel and textiles and consumer electronics. Some of their
biggest customers include Toyota and Canon.

2. Does SITC have a dividend policy? SITC does not have an
official dividend policy, but has been steadily paying dividends
in the last 10 years (36% payout in 2010, and 42% payout in
2011, and the eight years before IPO in 2010). Management is
also incentivised to pay dividends as key management and
employees own 75% of the company.

3. Is the company worried about competition, especially amidst
over-supply generally? Competition has always been firm in
this sector but SITC has been growing at a CAGR of 10% since
its founding 20 years ago, using its unique business model (see
points 1 and 2). Whilst ASPs have been affected as seen in
2010 and 2011 results due to over-supply generally, it would
be difficult for competitors to replicate its model and services
completely (SITC's fleet averages 1,000 TEUs per vessel which
fits a high frequency, high density model whereas attempts to
employ larger vessels on such a model may not be profitable),
and SITC has remained fairly profitable whilst other major liners
have been loss-making.

Our take
We believe SITC will continue to benefit from robust intra-Asia
trade demand and that it has great potential from its land
logistics business.

SITC offers 16% ROE and a decent ~5% dividend yield, but is
still trading far below its historical average valuation. We have
a BUY call with HK$2.90 TP (1.2x FY13 P/b)



Page 20
SUNAC


1. Sunac's landbank is valuable, although the size looks not
large. As of now, Sunac has 14m sm landbank only, but it can
turn into over Rmb200bn saleable resources. If factoring
growth, the landbank is sufficient for three to four year's
development.

2. The management emphases risk control by (1) focusing on a
limited number of key cities with high market depth and
growing population (2) controlling sales proceeds collection (3)
avoiding mistakes in land purchases which can cost the
company more than it appears to be, if taking the opportunity
cost into consideration.

3. Sunac will be less aggressive in using leveraging to buy land
in FY13, but may enter one more new cities within existing
regions.

1. FY12 sales-through rate based on launched saleable
resources was over 75%, compared with c. 50% based on that
with sales permit.

2. Pre-sales target in FY13 is Rmb45bn (Rmb30bn on an
attributable bases) based on RMB80bn to Rmb90bn saleable
resources.

3. Management expect net debt ratio by end-FY12 to be less
than 100% and is comfortable with a100% net debt ratio
level.

management)
1. Whether to raise fund from equity? Company still has over
Rmb10bn cash on its balance sheet. Management views the
share price still has upwards potential and may wait for a
better price to do a placement. As Sunac will be less
aggressive in purchasing land, there is no need to place shares
at present. 2. Will CDH and Bain further sell down their
holdings? CDH and Bain still hold c. 10% of the company's
shares. They indicated they won't further sell when Sunac
communicated with them recently. However, Sunac
management believes its reduction of the holdings will improve
stock liquidity and welcome the sale to remove the overhang.
In addition, private equity's tenure is usually five to seven years.
CDH and Bain may need to get out before 2015 if we assume
it will pull out upon the fund's maturity. 3. How is the
cooperation with various partners doing? Sunac leverages on
partners' financial resources and various expertise, while
Sunac's strength is on the market knowledge side and property
pricing side. In several cases of the JV projects, Sunac priced
the projects better than their partners' expectations without
lowering the sales-through rates.



Page 21
TCL COMM
(FULLY VALUED HK$2.53; TP:1.40; 2618 HK)


1. TCLC is planning to leverage the strong TCL TV brand and
distribution network in China to sell its smartphones.

2. The demand for mid-end smartphone (ASP at c.US$200) is
building up (from replacement), compared with mostly entry
level smartphones for first time smartphone users one to two
years ago.

3. Management believes that overseas market is where it can
make profit. China market is simply too competitive.


1. Expect turnaround in 2Q13 or 3Q13

2.4G phones will be available this year

3. Currently entry level smartphone margin was as low as 13-
15%, but the target is 20% for mid-end smartphones.

management):
1. How does TCLCs smartphone differentiate from others'?
TCLC is not competing with Apple or Samsung. Cost is lower
than for foreign brands. As compared with ZTE and Huawei, a
strong overseas distribution network (and Alcatel branding) is
the advantage.

2.What is the business strategy for FY13 to turn around the
business? Improving smartphones time-to-market to secure
ASP and margins.

3. When should we expect to see the business turn around?
2Q13 or 3Q13.

Recommendation: FULLY VALUED; TP: HK$1.40

YANLORD
(HOLD S$1.605; TP: S$1.24; YLLG SP)



1. Management agrees with the market view that the company
needs to improve its asset turn. It will try to speed up
construction gradually in FY13 to improve its asset turn.

2. Investment property (IP) income may see high growth in
2013 given improvement in occupancy rates as three
investment properties are maturing.

3. May restart landbanking in FY13. Yanlord didn't buy any
land in FY12. In FY13, Yanlord may considering buy some land,
especially in Nanjing. The Nanjing market performed the best
among the cities Yanlord has a presence in, and Yanlord's land
bank in Nanjing has dropped in the city. Yanlord may try to
replenish it.

1. Yanlord maintains its FY13 sales target of Rmb13bn which it
set in Nov 2012 and expect a balanced contracted sales
split between1H 13 and 2H13.

2. Four new projects will be launched for sale in FY13,
namely: Shenzhen Longguang project, Chengdu Riverbay,
Tangshan Nanhu Eco city, and Zhuhai Marina Center. If the
construction pace allows, three more new projects in Shanghai
( Qingpu Xujiang Town, Yanlord Eastern Garden, and Tang
Dong Nan) may be added into the pre-sales pipeline towards
year end in 2013.

management)
1. Should we expect further tightening as ASP may be back to
an upward trend? Management believes local government's
financial needs to invest in public projects create resistance to
further tightening. Management expects only a gradual
increase in ASP and believes this will not trigger further
tightening.

2. Any financing plan? No urgent need to raise funding at this
stage despite of the wide-opened debt market and good share
price performance. Unlike 2012, Yanlord has no major debt to
refinance in 2013. Onshore bank borrowing is not hard to get
either. Unless there is good land to buy, Yanlord will not raise
money through either equity or debt.



Page 22
3. Margin expectations. Management expects a stable recovery
in margin. In 2012, most of the GFA delivered was the first
phases of the projects which enjoys lower margin. In 2013, the
impact will be still there but less, while in 2014, the
management expects a recovery in margins.

YUEXIU
(NOT RATED HK$2.69; 123HK)


1.2013 salable resources may grow by >20%. This may imply
20% pre-sales growth, assuming similar sales rate of 2012, in
our view.
2.Saleable resources outside of Guangdong may go beyond
20% in 2013 3.More JV has been done in 2H for new land
acquisitions to minimise execution risk in new cities

1.Average funding cost in 2013 will further go down from
7.5% in 1H12 due to the disposal of IFC, more offshore term
loans being done, and pay-down of trust loans in China.
2. By 2015 pre-sales contribution from outside of Guandong
my go beyond 30 to 40% from current 12%.

management)
1. Pre-sales target in 2013?
2. Gross margin in cities outside of Guangdong?
3.Assets to be injected to Yeuxiu REITs over the next few years?



Page 23
YUEXIU REIT

Number of clients met: c. 20

1. Guangzhou IFC is expected to see improvement in
occupancy rate and rental income in all the four components
(office, retail, hotel, service apartment) in 2013 2. Yuexiu REIT
will focus on the operation of Guangzhou IFC and
consolidation of the management team in 2013 rather
acquisitions.

1. DPU 2012 is expected to be close to the Rmb2.063 as what
the company illustrated in the circulation of the GZ IFC
acquisition deal.

2. Maintenance CAPEX in 2013 may be higher than previous
years due to renovation of 2F of GZ White Horse.

3. Potential interest cost saving of Rmb45mn if it can replace
the loan brought forward from GZ IFC deal with lower cost
financing.

management)
1. How is the Guangzhou office market doing? New supply of
office in Guangzhou has peaked in FY12. It put some pressure
on rents in the market. But going forward, occupancy rates
may start to decrease as new supply drops. Rent is expected to
start to grow.

2. What is the acquisition plan? In FY13, Yuexiu REIT will only
focus on the performance of GZ IFC. However, going forward,
Yuexiu REIT will try to acquire one new asset every two to
three years from either the Yuexiu Property or 2nd parties. As
the market cap and financial capability of Yuexiu REIT have
been improved after the GZ IFC deal, Yuexiu REIT is better
positioned to acquire assets from external sources. It also
considers acquiring asset outside Guangzhou, including Beijing,
Shanghai, Hong Kong, and Macao.

3. Any updates on rental and occupancy status of GZ IFC? At
present, the office portion sees c. 70% occupancy rate and
average rent of c. Rmb250/sm/month. The retail part sees an
occupancy rate of c. 96%. Four Seasons and Service
Apartment portions see occupancy rates of c. 38% and 10%.
All improved from the level when Yuexiu REIT acquired it.
Office portion is expected to see further pickup in occupancy
rate to 80% to 85%, which is the major rental growth driver
for FY13.



Page 24
KOREA CORPORATES

COM2US
(BUY KRW46,900; TP: KRW70,000;
078340 KQ)


1. The companys strong growth in 2012 is bolstered by higher
smart phone penetration globally including in South Korea
(58%, US 48%, Japan 31%, China 24%)

2. It has focused on Smartphone games and Freemium (free to
play) and social games which offers broader audience/mass
market and longer life cycle.

3. Domestic and overseas revenue contributes 65%, 35% in
3Q12, respectively and overseas revenue is strengthening its
growth. US accounts for 50%, Japan accounts for 15% and
Taiwan contributes 10% to the total overseas revenue.

1. The company had launched 24 games in 2012 and will
launch 50 games (33 in-house games, 17 publishing games in
2013. Especially 11 games will be introduced to the market in
1Q13.

2. The company will increase new game launch in the
messenger platform (KAKAO talk in Korea and Line in Japan)
to 16 games in 2013 from four games in 2012.

3. To increase margins, it will enhance use of the companys
platform Com2us HuB, which is able to save the commission
payment to the platform such as Apple Store, Google Play and
Messengers.

management)
Investors asked about the companys guidance for 2012s and
2013s results, but the company hasnt suggested any
guidance.

However, according to its IR team, our analyst estimate would
be acceptable. Our analyst estimates on 2012 are KRW 78bn
revenue and KRW 17bn operating profit. For 2013, revenue,
OP and NP are KRW110bn, KRW28bn, respectively.

Our take
We maintain our BUY call with KRW70,000 TP since the
company should be the largest beneficiary of the strong
growth in the mobile game market.



Page 25
KOLONG LIFE SCIENCE
(NOT RATED KRW 84,600; 102940 KQ)


1. Expect to register c KRW34 bn revenue in 4Q12, but the
operating profit would decline slightly thanks to one-off costs
with the profit sharing with employee.

2. Pharmaceutical business accounts for 43% of total revenue
and is the fast growing segment posted 25% growth for last
two years.

3.This is also most profitable segment in the company, the
operating margins in 2012 is estimated to be a 31.7%.

1. It has been maintained long-term strategic partnership with
Japanese clients such as Simitomo, which account for 85% of
its pharmaceutical products revenue.
The company is sole overseas supplier of API (Active
Pharmaceutical ingredient) for Japanese pharmaceutical
companies, which are trying to diversify its procurement to
include overseas suppliers after the earthquake.

2. In 2013, the company expects to register a KRW140bn
revenue in the pharmaceutical biz from estimated c KRW60bn
in 2012 thanks to commercial operation commencement of
new API s plant in Chungju Korea. Of note, Chungju plant is
projected to generate a KRW200bn in case of full utilisation.

3. The company is at the 2
nd
phase of clinical trial of
Tissuegene-C, a biological drug for degenerative arthritis,
which is expected to commercialise in 2015.

management)
The sensitivity of the earnings on KRW against JPY : When
every 1KRW/JPN appreciates, its OP margins is estimated to
drop 3%pt in the pharmaceutical business.
It will consider the selling prices hike when forex of KRW/JPN
reaches 10.

Our take
The company is yet our coverage and trading at 20x P/E and 4x
P/B based on FY12 consensus estimates. The outlook on the
company seems to be promising.

KOOK SOON DANG BREWERY
(BUY KRW7,340; TP: KRW11,000;
043650 KQ)


1. Beer and Soju have gained the market share during Jan
~Sep 2012 by registered sales growth of 5.7%, 2.3% y-o-y,
respectively.
While Herbal wine and Makgeolli (Korean rice win) are
estimated to lose market share in 2012. This is mainly thank to
extraordinary hot temperature during the summer (trigger for
beer sales growth) and economy slowdown (trigger for soju
sales growth).
2. Its Draft Makgeolli products was the key driver for the top-
line growth by registered a 53.3% growth in 2011,
However the revenue of Makgeolli has declined 4.6% by
3Q12 affected negatively from hot temperature in the summer.
3. The company has launched new product called iCing,
which is iced Makgeolli using super-cooling technology. The
product make of domestic rice and grapefruit juice targeting
the young generation.
Also it launched New Bekseju (a herbal wine) reformatted
and repackaged in Sep 2012.

1. Despite new product launches, its 4Q12s revenue is likely to
decline q-o-q and y-o-y because of slow market penetration,
affected adversely from the faulty bottle for New Bekseju.
(This bottle supplier is accountable, and has no direct
negative impact on the company).
2. The company is targeting KRW 126bn revenue and
KRW15bn operating profit (more than double) in 2013, given
that cost reduction due to i) the price decrease of rice and
packaging material ii) decline in sales proportion of the
products with higher COGS.
3. The company expects visible top line growth from new
products since 1Q13.

management)
key points.

Our take
We maintain our BUY call with KRW11,000 TP at the
anticipation of turnaround in 2013.



Page 26
LG LIFE SCIENCE
(BUY; KRW55,500; TP: KRW65,000;
068870 KS)


1. Expect to double the revenue in 2015 from a KRW341bn in
2010 driven by the four projects which are DPP-IV (anti diabetic
drug), Combo-vaccine, hGH (human growth hormone) and
other generic business partnered with Pfizer in Korea.

2. The biggest contribution in near term will be antidiabetic
drug (project of DPP-IV), whose global market is estimated c
US$34bn in 2011 and to grow US$44bn in 2016.

3. During 2009 to 2013, the fixed costs including R&D costs
would increase by 61% or KRW35bn, which is the reason to
hamper earnings growth.

However, the company will see V-shape rebound in 2014
following commencement of commercial sales of diabetic drug.

1. The company has made a contract with multinational
pharmaceutical company Sanofi-Aventis to export an anti-
diabetic drug, which will deliver c KRW100bn profits from the
initial down payment, milestone payment, and bonus fees.
Besides it, the double digit royalty income and manufacturing
margins are expected when the sales of drug commence.

2. Among it, the initial payment of c KRW10bn would lift
4Q12E earnings, which is the reason for the recent strong
share prices hike.

3. In 2013, the company will make partnership with global
drug distributors and pharmaceutical companies to build the
sales channel for new drugs under development including a
diabetes drug, hormone and vaccine. These would be positive
share price catalysts.

management)
key points.

Our take
We raised our TP to KRW 65,000 from KRW53,000 on 3 Jan
factoring in the contract with Sanofi-Aventis. We retain our
BUY call on the counter.



Page 27
MALAYSIA CORPORATES

BOUSTEAD HOLDINGS
(BUY RM 4.94; TP: RM6.40; BOUS MK)


1. Budgeting CPO prices to an average of RM2700/tonne in
2013, with prices expected to trend higher in 2H. FFB
production should remain flat in 2013.

2. BHIC or its heavy industries division should see more
contribution from the new OPVs in FY13. Upside may come
from MRO contracts for Malaysian Navy helicopters.

3. Pharmaniaga contributed 15% to group profit in FY12.
While the business is predominantly driven by government
concessions (75%) it is looking to expand to the Middle East
(halal market) and Vietnam.

1. The focus for plantations remains planting new seedlings to
improve FFB yields over the longer term. FFB yields are now 21
tonnes/ha and should continue to improve to 24 tonnes/ha in
the medium term.

2. Internal pretax profit target is to reach RM1bn in the next
one to two years. 2012 will be a record year for Pharmaniaga
but no specific numbers were given.

3. BHIC has provided for all potential write-downs from its
commercial projects and should be profitable this year. Profit
should be in the region of RM50 to RM100m.

management):
1.Impact of CPO export tax? Negligible now.

2.When will work on Cochrane development commence? So
far, 12 acres have been bought from LTAT and work will
commence in April this year. There will be further land
acquisitions from LTAT.

3.How sustainable is the property land bank? Boustead has
enough land banks to last another 10 to 15 years. This is not
withstanding potential new land banks from Batu Cantonment
and plantation land banks which may be converted for
development use.
DRB-HICOM
(BUY RM2.70; TP: RM3.35; DRB MK)


1. Proton turnaround underway with rationalisation of
distributorships, collaboration with Honda and tiering of
autopart suppliers. DRB is looking to relocate the Shah Alam
facility to Tanjong Malim where the prime land in Shah Alam
can be redeveloped.

2. Will be more aggressive with property launches in 2013 with
new CEO at the helm. Glenmarie Gardens in Johor (GDV
RM8bn) is slated for launch in 2014 and potential land sale is a
possibility.

3. Services business particularly Puspakom, Alam Flora and
KLAS have a lot of room for growth. DRB has proposed to the
government that all private vehicles above 10 years undergo
inspection. Alam Flora has expanded to Kelantan and
Terengganu. KLAS will benefit from the opening of KLIA2.

1.Proton is for now the most vulnerable business but it is still
profitable and can stand alone. The key to turning it around is
platform or engine sharing with other car makers.

2. Positive on the high-end hybrid auto segment with the
eventual launch of Audi A6 hybrid. This segment benefits from
a favourable tariff structure for below 2000 cc.

3. Since the opening of the Lotus showroom in Malaysia, it has
sold 15 cars. Current production for Lotus in UK is 2,000 units
(out of 8,000 capacity) and will need 4,000 units to breakeven.
Management believes the key to turning around Lotus is to
transform it from a 'gentleman's sports car' to a 'lifestyle sports
car' catering to a larger segment of the market.

management):
1. How true are the rumours of privatization at between
RM3.50 to RM4.00/share? As far as management is concerned,
this is a shareholder issue and could arise from the extension of
the recent privatization of Tradewinds.

2. Will you increase your stake in POS? Not at the moment as it


Page 28
would trigger a MGO.
3. How long before can Proton find a new platform to leverage
on? It is early days but hopefully this can be done by this year.
The Perdana replacement model is underway and will happen
this year but it will be a rebadged vehicle.

EASTERN & Oriental
(HOLD RM1.58; TP: RM1.80; EAST MK)

No of clients met: ~30

Salient points in management's presentation:
- 5.1b GDV launches in Penang, KL & Medini to support
earnings growth.
- On track to achieve KPIs.

Data-Points and other guidance made:
- New three-year plan to be unveiled soon.
- Andaman condos at Seri Tanjung Pinang selling price
touching a record 1700psf.
- Medini maiden soft-launch is in Mar (terrace ~RM800k).

management):
- Sime's contribution so far? (two BOD seats, collaboration
projects still under discussion).

- Penang property trend? (Prices have increased strongly but
increasingly many of the buyers are foreign).

- STP Phase 2 status? Pending final approval likely after
elections (the masterplan already approved in principal),
reclamation of 740 acres to be done in stages -- cost RM130-
150psf.



Page 29
HARTALEGA
(HOLD RM4.95; TP: RM4.70; HART MK)


Salient points in management presentation:
1) Demand for nitrile gloves will continue to remain strong.
Nitrile gloves (sales volume) grew >20% y-o-y in 2012,
outpaced natural rubber latex gloves which grew less than
10%.

2) Key focus market (Europe is the growth area), while it will
also build its OBM brand in Australia, China and India.

3) The NGC project and its potential growth and contribution.

Data points and management guidance:
1) Target revenue growth in FY14 is 20%.

2) Expect raw material nitrile prices to move up slightly in
2013.

3) Margin will be flat for FY13, followed by a slight decline in
FY14.

management):
1) Concern on access capacity in nitrile gloves (industry glut)?
Nitrile glove demand will continue to grow strongly as there is
still room for expansion especially in Europe and emerging
markets.

2) Will the additional/access capacity erode margins?
Hartalega may lower ASP due to competition but improving
line speed will sustain competitiveness and support margins.

3) How strong is the competition from China?
Malaysia manufacturers have a head start in the glove industry
(innovation and R&D), coupled with costs advantages in raw
materials, heat/energy and labour. Most of the gloves
manufactured in China are PVC gloves and non-medical grade,
and hence are not in direct competition with the Malaysian
manufacturers which are mostly medical grade.

MMC CORPORATION
(BUY RM2.70; TP: RM3.60; MMC MK)


1. Malakoff is to be listed by 2Q13. This is positive for MMC's
balance sheet as its stake will be reduced from 51% to an
associate stake. It is targeted to pay 50% to 75% of PAT in
dividends. About 90% of proceeds will be used to pare down
debts.

2. The extension of Segari PPA for another 10 years, acquisition
of Hicom Power and the ongoing construction of the
additional 1,000 MW in Tanjong Bin should be positive for
Malakoff's listing.

3. PTP's expansion of berth 13 and 14, costing c.RM900m, will
give it another 1.5m to 2m TEUs by 2015. Johor Port is also
looking to build a dry port moving some capacity to the
hinterland.

1. Looking to conclude another 200 acres of land to be leased
to two new investors in Tanjong Bin this year.

2.Post listing of Malakoff, MMC should own 35% to 40%.
Internal targets are to double current generation capacity from
5020 MW to 10,000 MW.

3. Ports profits will grow by 10 to 15% in 2013.

management):
1.How is the progesss of the MRT contract? It is progressing
well with tunneling work starting in 2Q13. Should be 25%
completed by end 2013.

2. What is the estimated market cap for Malakoff? Newspaper
reports have quoted numbers north of RM10bn.

3. When are the other MRT lines to be awarded? Likely after
elections in 2H13.



Page 30
RHB CAPITAL
(BUY RM7.83; TP: RM8.70; RHBC MK)


1. Need to leverage on retail which can be higher yielding -
RHB Easy allows for leveraged unit trust loans (ASB); the bank
has revisited auto loans now that pricing has become more
rational. There is currently an exclusive tie-up with Tesco for
RHB Easy kiosks and a partnership with Pos Malaysia for similar
functions.

2. Regional expansion is needed; taking the wholesale banking
route would be easier than to attempt to do retail banking for
selected localised markets. This is the basis for OSK's
acquisition. With OSK, RHB Cap would be able to tap on
regional distribution channels such as Singapore, Indonesia,
Vietnam, Thailand and Hong Kong. On its own, RHB Bank has
a presence in Singapore (seven branches), Thailand (one
branch) and Brunei (one branch).

3. 2013-15 would be years in which RHB Cap plans to build
out its regional connectivity and capabilities. This would be
spearheaded by its acquisition of Bank Mestika in Indonesia.
RHB Cap has re-applied to negotiate for a 40% stake in Bank
Mestika (previously 80%) after new rules released by Bank
Indonesia. RHB cap is hopeful it can receive approvals by mid-
year. The acquisition will be funded by a rights issue (hopefully
to be launched in 3Q13 pending Bank Indonesia granting an
approval).

1. Consolidated capital ratios (post Basel III) are guided at >8%
(Core Equity Tier 1), > 9% (Tier 1) and >13% (Total CAR).

2. Loan-to-deposit comfort level is at 85-90%.

3. NIM to likely slip by another 10-15bps mainly from deposit
competition.

(Firmer 2013 targets will be disclosed after the release of FY12
results by end Feb 2013).

Frequently asked questions (and management's response)
1. What is the rationale for acquiring OSK?
It is to gear up its presence to build up fee income for
wholesale banking and for improving regional distribution
channels. In addition, it also aids in complementing RHB Cap's
largely skewed institutional customer base to one with OSK's
retail customer base.

2. Would RHB Cap be able to hold up its competitive
advantage for its RHB Easy franchise?
RHB Cap's current tie up with Tesco and Pos Malaysia puts it to
an advantage. The key strategy to form RHB Easy was to create
a 'convenient' banking platform rather than aim to garner
deposits. RHB Easy's key selling point is the loans to ASB (unit
trust). RHB Easy offers six simple products.

3. How would these acquisitions (OSK and Bank Mestika
(pending)) affect capital an ROE?
These acquisitions are/will be equity funded. For OSK, the
acquisition was largely funded via a new 245m share issuance
which diluted ROE by c.50bps. In return OSK owns 9.8% of
RHB Cap. Bank Mestika's acquisition (when approved) will be
fully funded by a rights issue. The final amount will be
determined once price is finalised.



Page 31
PERISAI PETROLEUM
(BUY RM1.12; TP: RM1.35; PPT MK)


1. Looking to focus on production and drilling as their two core
businesses going forward. Aggressive asset acquisition will still
continue if opportunities arise.

2. New FPSO acquisition will be completed by mid-13, and it
will be operational by Jul13.

3. It is looking to acquire its second jack-up rig pursuant to the
option granted by Sembcorp which will expird by Feb12. 20%
will be payable upfront while the remaining portion will be
payable upon delivery. Perisai will be funding the initial 20%
via its proposed 10% private placement.

4. Its OSVs are currently under long term bareboat charter till
Aug15 with Ezra which will provide good visibility.

1.Net profit is likely to grow 10% this year though EPS is
expected to be flattish given the dilution from the share
issuance.

2. Its investment for asset acquisition is typically based on its
15% IRR benchmark, failing which the company will not
embark on the acquisition.

management):
1. Comfortable net gearing level? Between 1.5x-2x.

2. Potential risk issues with production and drilling assets?
Technical expertise is a potential problem, but it is mitigated by
having the right partners.

3. How confident is it in getting drilling contracts? Import
substitution is key. The company sees tremendous growth
opportunities given that most of the operating rigs in Malaysia
are foreign owned. A preference for locally owned rigs will
work to its advantage.

QL RESOURCES
(BUY RM3.17; TP: RM4.00; QLG MK)


1. Livestock: A new feedmill in Indonesia with a capex of
US$10m will be commissioned by April 2014. Food cost to
narrow by 2 sen. Added 4 sen to costs recently.

2. Marine: investing in prawn aquaculture in Sabah with
RM50m capex over four years; commissioned by March 2014.
Acquired surimi manufacturer in Kuantan (5k MT annual
capacity) with RM25m capex.

3. Plantation: still waiting for trees to mature. Added stake in
Boilermech from 35-40%.

1. RM3m impact on livestock and marine segments from a
wage hike, RM1m impact on the plantation segment.

2. Targeted FY14 capex of RM200m to be maintained.

3. Double-digit margin by FY14-15 (our FY13F pretax margin at
9.2%)

management):
1. What is the capacity utilisation for surimi production? - Not
the ideal method of measuring output, as output will be
constantly adjusted to cater for market demand. But generally
its 70% utilisation for its 75k MT p.a. capacity (single shift)

2. Upcoming trend of egg prices? Expected to be higher due to
the culling of chicken during the recent oversupply (seasonal
marker trend).

3. Company's dividend policy? 25-30%



Page 32
SP SETIA REIT
(BUY RM3.14; TP: RM4.10; SPSB MK)

No. of clients met: c.40

1.Record RM5.1b unbilled sales and strong launch pipeline to
underpin earnings visibility.

2. 2012 sales target of RM4b exceeded, targeting 30% sales
growth in FY13 to RM5.5b sales.

3. Strategy to sustain growth by strengthening core base in
Malaysia, increasing its presence in global cities, expanding its
portfolio of investment grade products and investing in
populous nations for future growth.

1. 15% placement (to address liquidity and to raise working
capital) after expiry of warrants on Jan 21.

2. Battersea officially launched in London yesterday (Phase 1:
800 units, GDV: GBP1b), with strong interest especially from
Malaysia.

3.Future gearing will be higher than the current level due to
foreign projects i.e. build-then-sell in Australia and London, but
partially mitigated by upcoming placement.

management):
1. How long will Tan Sri Liew stay on?
(Likely will not extend management contract expiring in early-
2015 and will be exercising put option to sell remaining 5%
stake by 2014).

2. What has change since MGO?
(No change in PNB's two BOD seats, Tan Sri Liew still in full
control, minimal key staff leaving).

3. Current property trends in Malaysia?
(Primary sales stronger than secondary due to ease of getting
loans and developers interest-bearing schemes).

SUNWAY REIT
(BUY RM1.58; TP: RM1.80; SREIT MK)

No. of clients met: c.20

1. Loss of revenue from closure of the Sunway Putra Mall in
April 2013 for 20-22 months will be offset by expected lower
interest costs, contribution from Sunway Medical Centre and
major rental renewals on Sunway Pyramid come September
2013.

2.The REIT is aiming for at least one acquisition in 2013, with
potential targets ranging from third party acquisitions to
sponsor-held assets. Asset pipeline remains strong at c.RM2b
worth of completed and under-construction assets.

3.Retail rental growth at Sunway Pyramid is expected to remain
resilient as asset enhancements and synergies from
surrounding assets (e.g. 1k extra parking spaces in Pinnacle on
weekends) improve footfall.

1. Capital expenditure over the next two years is RM300m
excluding Sunway Putra Mall refurbishment.

2.Targeting 5% DPU growth CAGR over next three years.

3.Targeting total asset value of RM7b in the next three to five
years.

management):
1. What is the occupancy cost on Sunway Pyramid? 18%
based on reported accounts.

2. What are the capitalisation rates on assets?

3.Office asset cap rates are 7%, retail assets are 6.2-6.3%,
while hospitality assets are 6.7-6.8%.

4. Any debt covenants on the REIT? What is a comfortable
gearing for Sunway REIT?

Sunway REIT has a 45% asset gearing covenant as a result of
its RM1.5b CP Programme. Internal threshold on gearing
stands at the low end of the 40% range.

- What is Sunway Bhd's stake in Sunway REIT? 37%, but
would likely be pared down to 34% post equity placement.



Page 33
TOP GLOVE
(HOLD RM5.47; TP: RM5.40; TOPG MK)


1) Glove demand will remain resilient, driven by strong growth
in the nitrile segment.

2) Capacity expansion is on track.

3) Nitrile mix is growing progressively and the long-term target
is to have a balanced mix between natural rubber latex and
nitrile gloves.

Data points and management guidance:
1) Management will maintain its high volume and low ASP
business model.

2) Latex prices should remain stable in 2013.

3) Overall margins will be flat in 2013.

Three frequently asked questions and managements response:
1) What are the challenges in 2013? Higher labour cost and
potentially higher gas costs.

2) How does Top Glove narrow the margin gap with Hartalega
and how long will it take to achieve this? Via improved
efficiency in production process (e.g.: faster line speed) in the
next two to three years.

3) What is Top Gloves margin for natural rubber latex vs
nitrile gloves? Average margin for natural rubber latex glove is
15-20%, while nitrile is 20%.

TSH RESOURCES
(HOLD RM2.21; TP: RM2.00; TSH MK)


1. It will continue to focus on undertaking new plantings in
Indonesia. Wakuba Ramet has been planted at its Indonesian
estates since end-12 which should be producing fruits in 2016.

2. It is still on the lookout for more plantation land, but the
issue is always with pricing as potential vendors are always
asking for unrealistically high prices.

3. It is trying to lower its net gearing ratio at the moment
which may slow down its expansion plan in FY13 to maintain a
healthy balance sheet.

1. FFB production has been rather disappointing after the
bountiful harvest in FY11, but recent harvests suggest that
production has started to recover. It is expecting >20% FFB
production growth in FY13.

2. The high palm oil inventory problem will be able to be
resolved given more time. It is the cheapest edible vegetable oil
that will always make it a better option vis--vis its competitors
like rape seed oil and soybean oil.

management)
1. When will CPO prices recover? It is impossible to predict the
direction of CPO price, but the company is bullish on the long-
term prospect of CPO prices, mainly due to the fact that it is
the cheapest edible oil.

2. Issues with labour shortage? This is a perennial problem
faced by upstream planters, but the company is trying its best
to adopt more automation in its operations which will help to
lessen the impact to a certain extent.

3. Dividend policy? The company has an unofficial payout
policy of up to 30% of its earnings.



Page 34
UEM LAND HOLDINGS
(HOLD RM2.10; TP: RM 2.10; ULHB MK)



1. Land sales will be limited going forward. It will only sell land
if the potential customers could bring in something unique to
its Nusajaya projects.

2. Impressive land price as well as property price appreciation is
a signal to greater prospects in Nusajaya. UEML will be looking
at more launches going forward given the strong response for
their projects, particularly those in the prime water-fronting
Puteri Harbour

3. It will still need to incur a lot of capex going forward despite
the robust progress witnessed. It still has 6k acres of
undeveloped land available on top of its existing projects in the
4k acres land bank

1. It is confident of achieving its FY12 earnings growth target
of 40% though sales growth target of 50% will be missed due
to several launch delays in Klang Valley.

2. It is keen to expand into other areas as well, particularly in
Sabah and Klang Valley. However, Nusajaya will remain its
main focus.

management)
1. Concern about oversupply of properties? It is pacing its
property launches and will only release products that are in
demand. So far, its sales in Nusajaya have been rather
impressive.

2. Any risk to its balance sheet? Its gearing level is very healthy
at the moment. It has sold RM600m sukuk recently which is
mainly utilised for working capital.

3. How can you bring in employment? Gerbang Nusajaya will
tackle the problem. There will be a lot of commercial activities
as the latest JVs with Ascendas and Peter Lim will make the
area a successful commercial hub.



Page 35
THAILAND CORPORATES

BANGKOK EXPRESSWAY PLC
(BUY BT36.75; TP: BT39.00; BECL TB)


1. Traffic growth is very strong at 5.8% in FY12. This is partly
due to floods last year. The average traffic volume in FY12 was
1.085m trips.

2. The management guided that the dividend payout will be
kept to at least Bt1.3/share, but there is a possibility that the
amount could be higher.

3. The company is very conservative on traffic growth in FY13.
Their target FY13 traffic growth is less than 2% despite the
strong car sales in FY12.

1. The company is very confident of a toll rate hike in FY13 of
Bt5/trip for FES and SES (sector A&B) unless there is deflation
from now until March 2013.

2. The toll rate hike will increase toll revenue by Bt500m per
annum and the new toll rate will be effective in 1 Sep, 2013.

3. The management expects CKP to be listed by end of 1Q13
at the earliest. BECL currently has a 30% stake in CKP. The
company declined to state the exact new shareholding
structure after IPO, but they hinted that it would be closed to
30%.

4. The recent buy more stake in TTW of 11% will be subject to
shareholder approval on 6 Feb, 2013. This will change from
dividend income previously to associate income. Normally, TTW
generates Bt2.4bn of net profit and BECL will get 20% of this.

Frequently asked questions (and response by management)
1. What is the mechanism for a toll rate hike?
For the existing one, the toll rate will be adjusted every five
years and the new toll rate will be linked with BKK CPI.
However, the new toll road (Sector B+) that BECL recently
signed is not inflation-linked. The toll rate adjustment for
Sector B+ will be Bt15/trip every five years.

2. What is your annual maintenance CAPEX?
Normally, the maintenance CAPEX for BECL is c.Bt200m-300m.

3. What is your IRR for Sector B+?
Based on the FA report the IRR for Sector B+ is 8% but that
assumptions is based on a 7% cost of debt and a 30% tax
rate. However, the current tax rate is now 20% and the actual
funding cost for BECL is less than 4%.



Page 36
CENTRAL PATTANA
(BUY BT82.25; TP: BT90.00; CPN TB)


1. Clear expansion plan. Will open three new malls this year,
four in 2014, and three in 2015.

2. Large capex of Bt40bn for 2013-15. These will be funded by
internal CF, borrowings, and divestment of assets to property
funds.

3. Looking to divest Central Chiangmai and Ramindra into
CPNRF this year, and hotels and office assets later.

1. Target 15% growth in revenue and 20% in EBIT in 2013.

2. Revenue growth to come from the 7-8% growth in rental
rates and 7-8% growth from new malls.

1. Size of the 2 assets to be injected into CPNRF?
About 7-9bn

2. Any plan to convert CPNRF into REIT?
Still have yet to decide, studying the pros and cons now. But
CPN will inject 2 assets into CPNRF first within this year.

3. Current occupancy cost of its tenants?
12-15% on average.

CHAROEN POKPHAND FOOD
(BUY BT33.25; TP: BT42.00; CPF TB)


1. FY12F was a challenging year mainly due to a weak farm
products segment but since mid-4Q12 prices have started to
pick up for chicken as supply has been cut. While pork prices
have not picked up by much as it takes longer to cut supply.

2. The company is still focused on growing its branded food
products segment as it offers higher gross margins compared
to the OEM sector. In any case, given the heavy promotion
now, operating margins are about the same, but should be
improving going forward as products gain better recognition.

3. CPP last year is still on target at 15-20% sales and profit
growth p.a. Going forward, growth should remain intact given
its unique selling point of offering more premium feed, and it
has a technical service team to give customer advice on feed
usage.

1. It expects food segment sales to grow at 15-20% p.a.

2. Margins should remain quite soft in 1H13 as the group has
acquired raw materials in advance for utilisation until end
2Q13F at a relatively high price. Meaningful recovery should be
from mid-FY13F.

3. CAPEX in FY13F should be at Bt15-16bn; 60% would be
used for overseas expansion (especially to build new facility or
expand capacity in Vietnam, Indonesia, the Philippines, and
Russia).

Frequently asked questions (and response by management):
1. Any overseas operations still making losses?
- Yes, in Russia, Turkey, and the Philippines. In any case, Russia
and the Philippines are loss making due to the operations there
being start ups, and should break-even soon. In Turkey, there
was a chicken over-supply situation but the loss is decelerating
and the situation should soon normalise.

2. Given that broiler chicken prices have been picking up,
would this result in more supply for the market?
- The price has recovered but it is still not convincing enough
for producers to increase production.

3. How long would it take to cure EMS disease in shrimps?
- Three to six months



Page 37
GMM GRAMMY
(NOT RATED BT18.40; GRAMMY TB)

No. of clients met: 30

1. Apart from the music business, in which GMM has an 80%
market share, and which accounts for about 50% of its total
revenues, it aims to grow its new broadcast business to
increase its revenue from 20% to about 50% of the total
revenue.

2. The cost of a mini set-top box and smart box are at 400bt
and 700bt, respectively, and they sell at 700bt and 999bt
respectively. They plan to lunch HD this year with costs expect
to be less than 2,000bt.

3. The average set-top box life is three years.

Data points:
1. Currently major business comprises music, media, movies
and other businesses (accounting for 80% of total revenue) the
remaining 20% comes from broadcasting.

2.The company has a dividend policy of paying not more than
40%.

3. Currently the D/E ratio increases substantially from less than
2x to over 3x by end 2012. The company does not yet have a
policy on D/E, but it will implement its internal target soon
after it aggressively expands its business in broadcasting.

1. How confident is it about its guidance of selling 1 million of
set-top boxes a year?
- During Euro2012 the company sold 1.2 million set-top boxes.
After that ended in 4Q, the company was selling an average of
80,000 set-top boxes a month and subscribers are still
increasing, especially on pay TV, so the company is very
confident it can sell at least 1 million a year.

2. How come the company doesnt have to outsource sales of
set-top boxes like RS does?
- It does not just sell set-top boxes, but plans to be a content
provider, to feed its channel (in Dec 2012 NBTC granted 14
broadcasting licenses to the company for 11 Pay TV channels
[8SD &3 HD] and three free-to-box channels).

3. What is the companys future plan and vision?
- The companys plan is to have a full offering of music, media,
movie and broadcasting and become one of the major free TV
stations as well as increase its revenue on Pay TV.

HEMARAJ LAND
(BUY BT3.62; TP: BT3.56; HEMRAJ TB)


1. HEMRAJ's industrial land sales hit a record high of 2,317 rai
in 2012, up from 1,670 rai sold in 2011. A total of 115
contracts, of which 80 are new customers, and 35 being
expansion by existing customers.

2. Positive outlook with FDI flow still strong.

3. Very strong growth outlook for the Ready Built Factories
(RBF) and warehouses.

1. Target land sales of 1,600 rai for 2013. Note that HEMRAJ
initially set its target at 1,500 rai for last year but raised its
forecast 3x during the course of the year and finally ended the
year at 2,317 rai.

2. Utilities revenue to reach Bt2bn by 2014 from 1.18bn in
2011.

3. Target DE at less than 1.2x.

1. Current land bank?
7,500 rai which should last for about five years

2. Land price movement?
Up 20% in 2012, as demand has shifted to the East, which
was spared from 2011 floods.

Recommendation: BUY, TP: Bt3.56



Page 38
QUALITY HOUSES PLC.
(BUY BT2.48; TP: BT3.00; QH TB)


1. Pre-sales totaled Bt16.6bn in 2012, strongly beating its
target of Bt15bn. Revenue grew 30%.

2. Very bullish on outlook, expecting strong earnings growth of
50% this year supported by rising revenue, improving margins
and lower tax rate.

3. Net gearing to come down further to 1x by end 2013 from
1.45x at end Sep 2012.

4. The stock is trading at a deep discount to its RNAV.

1. Target pre-sales to surge to Bt20bn this year, from Bt16.6bn
last year.

2. Target revenue to jump 50% to Bt18bn this year from
Bt12bn last year. Condo revenue to double from Bt3bn in
2012 to Bt6bn in 2013.

3. Target gross margin to improve further from 30% last year
to 32-33% this year.

1. Reasons for improving gross margin?
Changes in construction materials to suit new types of houses,
change in construction technique from conventional to tunnel
and pre-cast which helps speed up the construction period.

2. Property price trend?
House price should continue to increase in line with rising
construction costs.

3. Any plan to divest the investment in four listed companies,
HMPRO, LHBANK, QHPF, QHHR?
May reduce stake in LHBANK if the latter can find a strategic
partner. No plan to divest the rest.

SC ASSET
(BUY BT28.00; TP: BT32.00; SC TB)


1. Very aggressive in new project launched in FY12 of
Bt16.8bn (14 projects); the highest since FY03.

2. Strong pre-sales of Bt12bn in FY12, up 50% YoY.

3. The year-end FY12 backlog could reach more than Bt7bn
where 98% of backlog comes from condominium projects.

1. Targeting a revenue growth of 15% each year for the next
three years.

2. Pre-sales target in FY13 is Bt15bn.

3. The company is planning to launch 15 new projects in FY13
worth Bt20bn; 10 single detached house + one Townhouse +
four condominiums. In terms of location, 13 projects will be in
BMA and two projects in resort
town (holiday home in Cha-am & Condominium in Pattaya)

1. What are your criteria when you buy the land? 1) The land
should be close to the main road 2) We have to check demand
and supply situation in that area 3) It must be easily accessible
to a shopping mall.

2. Do you have a labor shortage problem? Actually, labor issue
is a challenging task for all property developers. However, SC
Asset mitigates this risk by employing a precast technology to
solve this problem. Six of 15 projects that will launch in FY13
will use precast technology.

3. What is your target for GPM and NPM? The company is
targeting to achieve at least 32% GPM and 13-14% NPM.



Page 39
SIAM GLOBAL HOUSE
(BUY BT18.60; TP: BT21.80; GLOBAL TB)


1. Positive on recent SCC partnership that should bring in
much support and many synergies in term of logistics,
sourcing, brand building expertise (for private label products),
IT, HR, and expansion.

2. Will have its first DC by end FY13F. The first phase would be
able to accommodate up to 50 stores, and 100 stores in the
second phase. SCC will help to develop the DC around the
outer ring road of Bangkok.

3. Last year it had succeeded in adding seven new stores and it
now has a total of 20 stores.

4. Now have purchased 15 pieces of land for store expansion
this year.

1. Targets inventory days to come down to 120 days in the
next few years from over 140 days previously.

2. Targets to open at least 12 stores p.a. from FY13F and reach
80 stores in the next five years

3. SSSG should be in the high single digits in FY13F, and will
gradually go up as they have more branches and build more
brand royalty with customers.

4. FY13F top line growth should be c. 50-55%, and gross
margin should improve to at least 16%

1. Why gross margin is low in FY12?
Promotions to draw in customer into new stores and higher
competition. But things should improve this year due to scale
increases and better sourcing.

2. Would this competition be higher from here on out?
It should not be that bad and will probably remain at about the
same level as there is no new player entering the market.

3. Are you opening a store in Bangkok soon?
No plans to do so at the moment, but will focus on upcountry
expansion in the next few years. There might be a need for a
new store format for Bangkok.

SVI
(BUY BT4.10; TP: BT4.70; SVI TB)


1. SVI expects the earnings to turn back to normal in 2H13.

2. The company plans to acquire a Swedish company called
Partnertech (the largest in Scandinavian). The deal should be
concluded by 1H13.

3. The key concern is political risk.

1. Targeting a revenue of US$300m and US$400m in FY13 and
FY14 respectively (from c.US$250m in FY12).

2. Expect gross margins of 11% and net margins of 9% in
FY13

3. SVI might plan to do a stock dividend to increase liquidity.

1. What is the price you expect to pay for acquisition? The
amount should be less than the book value of US$60m.

2. Is your target company making a profit? No, it is now
breaking even.

3. What is the synergy from this acquisition? 1) foothold in
Scandinavian and Europe market 2) SVI plans to shift some
products to be produced in Thailand due to the much lower
labour cost.



Page 40
TICON PROPERTY
(NO RATING BT15.00; TICON TB)

No. of clients met: 35

Salient points:
1. In 2013, the company expects to inject bt6 bn of its assets
into TFund (The company currently hold a 28% stake)

2. Capex for 2013 is set at around bt6bn comprises bt4.5bn
for warehouses and bt1.5bn for factories.

3. The land bank for warehouse and factories can secure
revenue for at least 18 months and four years, respectively.

Data points
1. TICON offer factories and warehouses for lease on 13
industrial estates and 17 strategic logistics location. It has
1,500 employees in-house for construction using its own
platform.

2. The company broke even for warehouses and factories in
five and seven years respectively and its contract lease duration
is three years with the option to renew and the price can be
increased but not more than the CPI accumulated for three
years

3. The company aims to maintain the gross margin for its
factory business at a high level of 45% while the warehouse
business gross margin is at 30%

1. What is the new and interesting industrial area in Thailand
at the moment?
- Kabinburi Industrial zone.

2. How often is the company increasing its rental rate?
- After the flooding until now the existing clients still pay the
same rate and new clients pay only a bit higher rate. The
company doesnt have a policy on percentage to be increased
per year. Most clients are still mainly from Japan (61%).

3. Does the company plan to sell land like Amata and Hemraj?
- At the moment the company has no plans to do so, and still
focuses on warehouses and factories for lease. Currently the
factories for lease business, Ticon, accounts about 2/3 of the
total market share.

THAI UNION FROZEN PRODUCTS
(BUY BT71.25; TP: BT91.00; TUF TB)


1. Last year was a challenge year for the shrimp business as
one of its production facilities caught fire and it did not have
enough capacity to supply its customers. Also EMS (early
mortality syndrome) in shrimp has cut market supply by 10-
15% which has impacted shrimp feed sales.

2. Going forward, the sales mix could change slightly as the
growth in pet food products and sardine sales are very high.
While, tuna sales continuation could drop to below 50%.

3. The tuna business in the US (Chicken of the Sea, which is
No. 3 in terms of market share in the US) faced challenges last
year, particularly in terms of price competition as competitors
with the No. 1 and No. 2 market share initially didn't want to
increase prices even though raw material costs had surged, as
they had hoped to gain more market share. But, now as no
one is really making any profit, they have recently started to
increase their selling price, so TUF's margin should also
improve.

1. The pet food business in the US (started in Jan12) should
break even by end FY13F. The gross margin should be high at
c.30% as it is selling premium pet food to specialty stores. The
normal margin is c. 20% and slightly over 20% for pet food
OEM and normal branded products.

2. Expect tuna raw material price to increase q-o-q in 1Q13F as
the catch condition is still difficult and demand is solid.

3. Expect gross margin in FY13F to be slightly higher than 17%

1. Why are you very active in doing M&A?
- New acquisition does not only bring in additional revenue but
also new ideas and expertise that could be used to improve
existing businesses.

2. Between OEM and branded products, which one provides
better margin stability?
- Normally OEM product margins are more stable as the order
cycle (from buyers) is shorter, so when it comes to rising raw
material prices, the company can get pass the higher costs
faster. But, in term of business stability, branded products are
better as sales do not rely heavily on buyers.

3. What is your key strategy to avoid price competition in the
US this year?
- Introduce new products.


Page 41
INDONESIA CORPORATES

ADARO ENERGY
(BUY RP1,750; TP: RP1,650; ADRO IJ)


1) Adro will continue to focus on margins, not volume, and not
be willing to sell its coal at depressed margins. Production cuts
are possible if margins are not good enough.

2) Cost cutting is the key focus this year to help improve
margins.

3) Coal price is near suppliers production cost

Data point and other guidance:
1) ASP guidance for FY12 is US$72-75/ton. ASP in 9M12 was
us$73/ton, still in line with its guidance. However, expect lower
ASP in 4Q12 due to a decline in coal prices.

2) Cash cost guidance for FY12 is US$39-42/ton. The company
expects cash cost in FY13F to decline or be flat, driven by lower
stripping ratio and the new OPCC conveyor.

3) Adro plans to lower the strip ratio from 6.4x in FY12 to near
6x in FY13m

1. What is the production target in FY13F? The company will
announce its guidance by end January.

2. How to lower production cost? By lowering stripping ratio
and using new OPCC conveyor belt to reduce overburden cost.

3. How's coal demand recently? The problem has more to do
with oversupply than demand. After the coal price decline,
expect production cuts from high-cost coal producers like
Australia. Some small-medium miners in Indonesia are also
cutting production as they are not profitable. However, we
don't know the exact number of supply cuts to the market.

BUMI SERPONG DAMAI
(BUY RP1,130; TP: RP1,800; BSDE IJ)


1. As previously announced, BSDE is entering a JV with HK
Land to develop a premium housing cluster in BSD City. Once
the deal is finalised, BSDE could book at least Rp1tr worth of
pre-sales in 2013 which means earnings could be boosted by
c.Rp500bn or higher on top of our current estimates of Rp1.4tr
(potential +60% y-o-y earnings growth). BSDE will sell 65ha of
land banks to this JV (where BSDE will hold 51% stake), as raw
land banks for the project.

2. The company also indicates it might enter another JV with
foreign partner to build commercial properties. This could
provide another boost in earnings in 2013 if the company is
able to finalise the land plot sales.
3. We think the company understands the needs to quickly
monetise its land bank. Going forward, BSDE will actively
pursue other JV opportunities as it plans to speed up
monetizing its huge land bank.

1. Given more uncertainties due to the coming 2014 election,
BSDE is only targeting 10 to 15% ASP growth y-o-y versus 20
to 30% y-o-y growth in the past three years in line with
overall industry sentiment.

2. In line with ASP growth, pre-sales is expected to grow at
least by 15% y-o-y, excluding JVs transactions. Taking into
account the two JVs, pre-sales could go up to 40% y-o-y.

3. Management indicates that 2012 revenue should be in the
Rp3.5-3.7tr range while net profit should at least be Rp1tr,
maintaining a net margin of 30-35%.

1. Since ASP has been rapidly appreciating in the past three
years, have properties in BSD City become unaffordable? Will
this soften the demand? Management is still confident that
demand will remain robust. Despite the rapid price
appreciation, the gap between price in BSD City and Jakarta is
still quite wide. Hence, management believes it still offers an
affordable housing solution.



Page 42
2. What is the update on the Delta Mas acquisition? From Sinar
Mas Groups (the holdings group) perspective, it is indifferent
on whether to inject Delta Mas into BSDE or not as it would
still enjoy the profitability of both companies. If injected,
BSDE's margin might be dragged down as industrial estate
profitability is lower. However, if injected, it will give investors
exposures to the industrial estate sector. At this point, the
holding group has not made any decision on the matter. The
decision is unlikely to be reached in the near term.

SAMPOERNA AGRO
(BUY RP2,625; TP: RP2,800; SGRO IJ)


1. Sampoerna Agro (SGRO) revealed that it had added c.40k
ha of greenfield land bank for oil palm last year. SGRO plans to
expand its oil palm estates by 7k ha p.a. going forward
(significantly higher than in 2012, which was c.5k ha) - both
include smallholders. Currently the biggest risk the industry
faces is not the weather or price, but social issues. The group
has been proactive even before tighter regulations were
introduced.

2. For rubber, the group intends to eventually plant between
45k and 50k ha on the 100k ha of forestry concession it had
acquired for rubber estates last year (West Kalimantan). Last
year it planted c.200 ha; and this year it intends to plant c.1.0-
1.2k ha.

3. The group is always on the lookout for further land bank
acquisitions; and may consider going into refining when its
CPO production reaches 500k MT or more. This is for
economies of scale, as its bargaining power may start to
deteriorate at that level. The group currently produces c.340k
MT of CPO annually. On the question of potential investment
in sugar, the group is also open to the idea; although there are
no concrete plans.

1. The capex this year will remain at around Rp1 trillion.
Around 80% of this will be spent on palm oil estates; and the
rest on rubber and sago. Sago will only generate positive cash
flow in 2014-2015; but will not contribute meaningfully as the
gestation period is longer than palm oil (i.e. 10 years).

2. SGRO expects its 2013 CPO output to increase by 5-10% -
higher growth for its own estates will offset negative growth in
smallholder estates. The smallholder estates will cyclically
contribute less this year because they have been steadily rising
over the past two years. The average smallholder estates' age is
15 years, vis-a-vis own estates' average of nine years (weighted
age is 11 years). Even though 1Q13 will seasonally drop q-o-q,
output will still grow y-o-y; and 2H13 contribution will be
similar to 2H12 - but less extreme.

3. Oil palm cost to maturity is between US$5.0k and 5.5k/ha
over three years (excluding mill). As at end 2011, its nucleus


Page 43
estates stood at 57% of the total planted; while the current
net plantable hectarage is 49,300.

4. The group mainly sells its CPO to Wilmar (30%) and Cargill
(5%). On an FOB basis (i.e. typically destined for exports), the
group sells approximately 15% of total sales volume.

management) :
1. Are there cost pressures going forward?
The group's estates are located in South Sumatra, Central and
West Kalimantan. Overall the minimum wage increase in these
areas will average around 14% - but the group's nucleus
labour cost component is only 30%. Hence for its nucleus
estates cost of production would increase by around 4%. Yet,
on a consolidated basis the group's COGS is mostly made up
of smallholder FFB purchases. Inclusive of this, labour costs only
account for 9% of the total cost. This would limit cost
increases to just 1%. Any potential increase would be further
offset by lower expected fertiliser costs, weaker IDR, and
efficiency through mechanisation. The group commented that
the increase in minimum wage in Indonesia would be negative
for planters in Malaysia, as they would have to compete for
labourers. The group's average cash cost in 2011 was
c.US$450/MT (overall). This is comprised of own estates at
c.US$250/MT and smallholders estates at c.US$600/MT.

2. What is the group's outlook on the CPO price?
The group believes that there may be an upside surprise in
1Q13 (due to supply rather than demand); and that it is
generally bullish for 1H13. However, the outlook for 2H13
remains to be seen. The group does not expect the average
CPO price this year to change much from 2012; although in its
budget, the group only imputes RM2,700 for the year. For
SGRO, it is more of a volume growth story.

3. Will there be margins improvements in 2013?
Not significant, as despite increasing contribution from own
estates and lower contribution from smallholders, FFB yields
from own estates are still low when they start to mature. It also
depends on the CPO price.

TOWER BERSAMA
(HOLD RP5,900; TP: RP5,300; TBIG IJ)


1. Besides, XL and Indosat, Telkomsel has also adopted a
tower-leasing model despite its healthy balance sheet in order
to control significant variations in costs and schedule in
building towers.

2. Top-4 telcos account for 70% of its revenue which is
manifested in the form of lower interest costs in its evergreen
US$2Bn debt program. This benefit is not available to its
competitors.

3. 3G base stations account for less than 5% of its total
portfolio but is likely to see sharp growth over the next couple
of years. Due to lower signal propagation at higher 3G
frequency, a telco needs almost three times the number of 3G
base stations as 2G to get similar coverage.

1. Likely to add 3300-3400 tenants organically in 2012 and
2013 each.

2. Its current orderbook is around 1000 tenants, mostly from
build-to-suit towers as co-locations orders are fulfilled in 45
days only.

management):
1. Do you feel downward pressure on leasing rates in Indonesia
as telcos feel the heat?
TBIG has not lowered its pricing and its bigger peer is also
equally eager to maintain the lease price. Smaller tower players
may compromise on pricing but do not have the muscle to
complete the tower construction in time and budget, and
often give up in the middle of the project. To be fair, TBIG
allows an existing telco to add 3G BTS at 25-30% of the lease
price for 2G BTS.

2. Is there a risk that land lease might not be renewed?
Not really, as many landlords agree to renew leases much
before the expiry of the lease due to upfront cash payment for
10 years and attractive leasing rates. There is not much
alternative use of land and many of the landowners are
individuals. TBIG has ample negotiating power.



Page 44
3. Are interest costs fixed or floating in nature and is there a
currency risk? TBIG raises US$ denominated debt at a fixed
3.5% rate and swaps for Indonesia Rupiah leading to a 9%
rate in Indonesian Rupiah. As such, there is no currency risk
involved.



Page 45

PARTICIPATING CORPORATES

EPS

CAGR

Price Mkt Cap Target
FY13 (FY12-14

10 Jan 2013 US$m Price
PE (x) (%)
Rating
SINGAPORE S$ S$

ARA Asset 1.72 1,081 1.70~ 18.5 4 Buy~
Ascendas Hospitality Trust 0.97 638 0.98 4.3* na Buy
Cordlife Group Ltd 0.58 110 0.65 15.2 20 NR
Cosco Corporation Singapore Ltd 0.985 1,804 0.80 20.0 5 FV
CWT Ltd 1.26 619 NR 7.8# 11.1# NR
Del Monte Pacific 0.685 603 NR na na NR
Ezion Holdings Ltd 1.88 1,378 2.12 11.8 58 Buy
Ezra Holdings Ltd 1.325 1,060 1.30~ 24.5 128 Buy~
Far East Hospitality Trust 0.985 1,292 1.09 6.0* 5** Buy
Gallent Venture 0.29 572 UR 60.7 151 NR
Golden Agri-Resources Ltd 0.66 6,931 0.71 10.3 24 NR
Goodpack 1.89 866 1.95 16.5 10 Hold
Hutchison Port Holdings Trust US$0.82 7,141 US$0.88 7.7* (1)** Buy
Jardine Cycle & Carriage Ltd 48.68 14,164 NR 11.3# 6# NR
Nam Cheong 0.285 446 0.30 8.6 17 Buy
Raffles Medical Group 2.89 1,288 2.59 25.2 13 Hold
Religare Health Trust 0.90 580 0.97 4.4* na Buy
STX OSV Holdings Limited 1.33 1,284 2.00 7.0 2 Buy
Tat Hong Holdings Ltd 1.455 675 1.80 11.4 45 Buy
Wing Tai Holdings Ltd 2.08 1,332 . 3.2 (7) Buy

* FY13 Dividend Yield and DPU CAGR 12-14
# Consensus forecast from Bloomberg
Source: DBS Vickers, Bloomberg
~ Rec & TP under review


Page 46

EPS

CAGR

FY13 (FY12-14

PE (x) (%)
Rating
HONG KONG HK$ HK$

Bosideng Int'l
2.40 2,479 n.a. 10.9 (1.6) NR
C C Land
3.00 1,002 2.00 14.6 36.6 Hold
Central China
2.85 893 2.39 6.0 25.6 Buy
Chinasoft Int'l~
1.81 401 n.a. 10.4 9.8 NR
Chu Kong Petroleum
4.14
540

4.75 8.3 22.5 Buy
CITIC Telecom
2.23 687 1.70 10.4 5.9 Buy
Evergrande Real Estate
4.52 8,741 4.70 5.7 21.9 Buy
Far East Consortium 2.29

519 n.a. 10.0 13.6# NR
Fortune REIT 6.40

1,404 6.97 5.3 * 5.5* Buy
Franshion Properties
2.93 3.463 3.37 9.4 3.2 Buy
Manulife Financial~ 111.10

26,102 n.a. 10.5 n.a. NR
Netdragon Websoft
11.52 751 11.46 12.0 43.6 Buy
Newocean Energy 4.66

785 n.a. 9.3 27.4 NR
Prosperity REIT
2.47 440 2.63 5.7 * 5* Buy
Shenzhen Int'l 0.89

1,880 n.a. 9.1 11.0 NR
Shui On Land 3.86

2,989 3.56 14.3 44.0 Hold
SITC International 2.68

894 2.90 7.6 21.6 Buy
Sunac China~
6.73 2,618 n.a. 4.6 14.8 NR
Sunlight REIT 3.32

690 3.66 4.9* 2.2* Buy
TCL Comm 2.53

368 1.40 14.8 124.6 FV
VST Holdings 1.89

302 2.40 4.6 8.0 Buy
Wasion Group 3.73

447 n.a. 7.6 16.6 NR
Yanlord Land
1.605 2,558 1.24 13.0 14.6 Hold
Yashili Int'l~
2.38 1,082 n.a. 13.4 2.5 NR
Yuexiu Property~
2.69
3,226

n.a. 8.7 8.1 NR
Yuexiu REIT~ 3.86

1,366 n.a. 7.5 * (12.3)* NR
KOREA
KRW KRW
Com2uS 46,900 447 70,000 16.9 33 Buy
Kolon Life Science Inc. 84,600 412 n.a. 29.8 (14.4) NR
Kook Soon Dang Brewery 7,340 124 11,000 12.9 51 Buy
LG Life Sciences 55,500 869 65,000 107.8 - Buy
^ FY12A PE
# FY10-12 CAGR
* Dividend Yield and DPU CAGR
** FY13 P/NAV
~ Consensus
Source: Thomson Reuters, DBS Vickers


Page 47

EPS

CAGR

FY13 (FY12-14

PE (x) (%)
Rating
MALAYSIA
RM RM

Boustead Holdings 4.94 1,688 6.40 10.9 19 Buy
DRB Hicom 2.70 1,725 3.35 12.1 26 Buy
Eastern & Oriental 1.58 593 1.80 14.7 0 Hold
Hartalega Holdings 4.95 1,139 4.70 16.5 4 Hold
Media Chinese International 1.13 616 1.10 9.8 4 Hold
MMC Corporation 2.70 2,717 3.60 17.1 17 Buy
Perisai Petroleum Teknologi 1.12 315 1.35 11.8 0 Buy
QL Resources Bhd 3.17 839 4.00 17.3 12 Buy
RHB Capital Bhd 7.83 6,454 8.70 9.9 11 Buy
SP Setia Bhd 3.14 2,081 4.10 17.8 17 Buy
Sunway REIT 1.58 1,410 1.80 5.1* 11** Buy
Top Glove Corp 5.47 1,141 5.40 16.1 6 Hold
TSH Resources 2.21 614 2.00 16.8 22 Hold
UEM Land Holdings 2.10 3,004 2.10 23.5 12 Hold
WCT Bhd 2.41 755 3.25 13.0 10 Buy
THAILAND
Bangkok Expressway 36.75 874 39.00 13.4 26 Buy
Central Pattana 82.25 5,813 90.00 33.6 19 Buy
Charoen Pokphand Foods 33.25 8,540 42.00 13.6 66 Buy
GMM Grammy 18.40 322 NR na na NR
Hemaraj Land and Development 3.62 1,161 3.56 11.4 25 Buy
Quality Houses 2.48 642 3.00 11.5 24 Buy
SC Asset Corporation 28.00 620 32.00 10.5 41 Buy
Siam Global House 18.60 1,323 21.80 35.0 60 Buy
SVI 4.10 262 4.70 9.6 50 Buy
Thai Union Frozen Products 71.25 2,700 91.00 12.6 28 Buy
Ticon Industrial Connection 15.00 435 NR 10.2 7 NR
INDONESIA
Adaro Energy 1,750 5,795 1,650 11.9 9 Buy
Bumi Serpong Damai 1,130 2,047 1,800 14.0 16 Buy
Sampoerna Agro 2,625 514 2,800 10.7 31 Buy
Tower Bersama Infrastructure 5,900 2,930 5,300 29.0 48 Hold
Source: DBS Vickers, Bloomberg
* Distribution Yield and DPU CAGR FY12-14; ^ Consensus EPS and EPS CAGR FY12-14


Page 48
DBSV recommendations are based an Absolute Total Return* Rating system, defined as follows:
STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame)
BUY (>15% total return over the next 12 months for small caps, >10% for large caps)
HOLD (-10% to +15% total return over the next 12 months for small caps, -10% to +10% for large caps)
FULLY VALUED (negative total return i.e. > -10% over the next 12 months)
SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame)
Share price appreciation + dividends

DBS Vickers Research is available on the following electronic platforms: DBS Vickers (www.dbsvresearch.com); Thomson
(www.thomson.com/financial); Factset (www.factset.com); Reuters (www.rbr.reuters.com); Capital IQ (www.capitaliq.com) and Bloomberg (DBSR
GO). For access, please contact your DBSV salesperson.

GENERAL DISCLOSURE/DISCLAIMER
This report is prepared by DBS Vickers Research (Singapore) Pte Ltd ("DBSVR"), a direct wholly-owned subsidiary of DBS Vickers Securities
(Singapore) Pte Ltd ("DBSVS") and an indirect wholly-owned subsidiary of DBS Vickers Securities Holdings Pte Ltd ("DBSVH"). This report is
intended for clients of DBSV Group only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means
or (ii) redistributed without the prior written consent of DBSVR. It is being distributed in the United States by DBSV US, which accepts
responsibility for its contents. Any U.S. person receiving this report who wishes to effect transactions in any securities referred to herein should
contact DBS Vickers Securities (USA) Inc (DBSVUSA) directly and not its affiliate.

The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to
DBSVR, DBSVS, and/or DBSVH) do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed
are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document does
not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for
the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees, who should obtain separate
independent legal or financial advice. DBSVR accepts no liability whatsoever for any direct, indirect and/or consequential loss (including any claims
for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in relation to this document.
This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. DBSVH is a wholly-owned subsidiary of
DBS Bank Ltd. DBS Bank Ltd along with its affiliates and/or persons associated with any of them may from time to time have interests in the
securities mentioned in this document. DBSVR, DBSVS, DBS Bank Ltd and their associates, their directors, and/or employees may have positions in,
and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other
banking services for these companies.

Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there can
be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments.
The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it
may not contain all material information concerning the company (or companies) referred to in this report.

The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and
assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on
which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual
results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED
UPON as a representation and/or warranty by DBSVR, DBSVS and/or DBSVH (and/or any persons associated with the aforesaid entities), that:

(a) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and
(b) there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk
assessments stated therein.

Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies)
mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to the
commodity referred to in this report.

DBS Vickers Securities (USA) Inc ("DBSVUSA")"), a U.S.-registered broker-dealer, does not have its own investment banking or research
department, nor has it participated in any investment banking transaction as a manager or co-manager in the past twelve months. Any US persons
wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed
in this document should contact DBSVUSA exclusively.

ANALYST CERTIFICATION
The research analyst primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies
and their securities expressed in this report accurately reflect his/her personal views. The analyst also certifies that no part of his/her compensation
was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of 14 Jan 2013, the analyst and
his / her spouse and/or relatives who are financially dependent on the analyst, do not hold interests in the securities recommended in this report
(interest includes direct or indirect ownership of securities, directorships and trustee positions).



Page 49
COMPANY-SPECIFIC / REGULATORY DISCLOSURES
1.
DBS Vickers Securities (Singapore) Pte Ltd and its subsidiaries do not have a proprietary position in the company mentioned as of
10 Jan 2013

2.
DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBS Vickers Securities (USA) Inc ("DBSVUSA"), a U.S.-registered broker-
dealer, beneficially own a total of 1% or more of any class of common equity securities of the Ascendas Hospitality Trust, Far
East Hospitality, Fortune Reit as of 14 Jan 2013.
3. Compensation for investment banking services:

a)
DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBSVUSA have received compensation, within the past 12 months,
and within the next 3 months receive or intends to seek compensation for investment banking services from the ARA Asset,
Ascendas Hospitality Trust, Ezion Holdings, Ezra Holdings, Far East Hospitality Trust, Goodpack, Nam Cheong, Religare
Health Trust, Wing Tai.
DBSVHK, DBSVUSA, DBS Bank Ltd and/or other affiliates have received compensation, within the past 12 months, and within
the next 3 months may receive or intends to seek compensation for investment banking services from Fortune Real Estate
Investment Trust (778 HK) and Yuexiu REIT (405 HK).

b)
DBSVUSA does not have its own investment banking or research department, nor has it participated in any investment
banking transaction as a manager or co-manager in the past twelve months. Any US persons wishing to obtain further
information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in
this document should contact DBSVUSA exclusively.

RESTRICTIONS ON DISTRIBUTION
General This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or
located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be
contrary to law or regulation.

Australia This report is being distributed in Australia by DBSVR and DBSVS, which are exempted from the requirement to hold an
Australian financial services licence under the Corporation Act 2001 [CA] in respect of financial services provided to the
recipients. DBSVR and DBSVS are regulated by the Monetary Authority of Singapore [MAS] under the laws of Singapore,
which differ from Australian laws. Distribution of this report is intended only for wholesale investors within the meaning
of the CA.

Hong Kong This report is being distributed in Hong Kong by DBS Vickers (Hong Kong) Limited which is licensed and regulated by the
Hong Kong Securities and Futures Commission.

Singapore
This report is being distributed in Singapore by DBSVR, which holds a Financial Advisers licence and is regulated by the MAS.
This report may additionally be distributed in Singapore by DBSVS (Company Regn. No. 198600294G), which is an Exempt
Financial Adviser as defined under the Financial Advisers Act. Any research report produced by a foreign DBS Vickers entity,
analyst or affiliate is distributed in Singapore only to Institutional Investors, Expert Investors or Accredited Investors as
defined in the Securities and Futures Act, Chap. 289 of Singapore. Any distribution of research reports published by a
foreign-related corporation of DBSVR/DBSVS to Accredited Investors is provided pursuant to the approval by MAS of
research distribution arrangements under Paragraph 11 of the First Schedule to the FAA.

United
Kingdom
This report is being distributed in the UK by DBS Vickers Securities (UK) Ltd, who is an authorised person in the meaning of
the Financial Services and Markets Act and is regulated by The Financial Services Authority. Research distributed in the UK is
intended only for institutional clients.

Dubai/
United Arab
Emirates
This report is being distributed in Dubai/United Arab Emirates by DBS Bank Ltd, Dubai (PO Box 506538, 3
rd
Floor, Building 3,
Gate Precinct, DIFC, Dubai, United Arab Emirates) and is intended only for clients who meet the DFSA regulatory criteria to
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the Dubai Financial Services Authority.

United States Neither this report nor any copy hereof may be taken or distributed into the United States or to any U.S. person except in
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Marina Bay Financial Centre Tower 3
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Tel: (65) 6327 2288
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