THE DECISION-MAKING PROCESS: TOP DOWN AND

BOTTOM-UP

Written by:

NATALIE YOHANA RAMIREZ RESTREPO

JOHANNA MONSALVE ESPINAL
MAURICIO ALONSO JARAMILLO ALVAREZ

TEACHER: SERGIO ANDRES GIRALDO BLANDON

SUBJECT: MERCADO INTERNACIONAL DE CAPITALES
DATE: 06 DE MARZO DE 2015

INSTITUCIN UNIVERSITARIA DE ENVIGADO

FACULTAD DE CIENCIAS EMPRESARIALES
ADMINISTRACIN DE NEGOCIOS INTERNACIONALES
CARRERA 27 B # 39 A SUR 57
ENVIGADO
2015

INTRODUCTION
The goal of fundamental analysis is simply to get to provide investment advice on a
particular value according to the confrontation between what the analyst
understands that it is his fundamental valuation and the market said at the time, the
price, etc., determining the INTRINSIC VALUE.
In undertaking the process of decision making, you can use two basic techniques
of approaching the values will depend on the starting point for the
recommendations.
The two approaches to which we are referring are the Top-Down and Bottom-Up,
whose literal translation would be "Arriba-Abajo" and the "Abajo-Arriba"
1) Top - Down
The method or Top-Down approach is one that takes investment decisions based
on the most comprehensive to go down gradually to the more specific variables.
The process of decision making could follow this path:
*The first analysis would be to analyze the situation of the international economic
cycle influence face to see how that variable in estimates to be undertaken by the
analyst on the company concerned.
*The second step is to analyze the prospects of the respective national or domestic
economies.
Then, within each of the national economies, we pay attention to sectors with a
view to see which of them will grow the economy as a whole and which less.
After making these phases, would the specific analysis of each company in which
he would assess the fundamental aspects of it, among which are the following:
- Competitive position of the company:
- Market share
- Product quality
- Barriers to entry
- Profitability of each company
- In terms of cost efficiency
- Capital management
- Success of past investments
- Operating and Financial Leverage

- Sensitivity of the benefits to the level of activity and financial situation

- Earnings growth
- Rating. Determination of Price Target
- Investment recommendation and decision making
Therefore, it looks as part of overall at most particular.
Clearly, any movement in variable has a significant influence on the overall
economy, but it will not be the same the influence of the economy to grow at a rate
determined for a company whose business depends largely on international
demand, because it operates using a standardized international product prices
(what is commonly known as commodities) as may be the case of Ecopetrol, that
the effect of that variable in companies that depend almost exclusively on the
domestic demand (case of Exito, the result of the merger between Casino and El
Grupo Empresarial Antioqueo) or maintain a system of regulated prices that
varies slightly from year to year as in the case of the electricity sector or highways.

2) Bottom Up
In this second approach to analysis, the decision-making process is reversed.
This approach is said that companies not using them, but values are analyzed.
Investment opportunities are analyzed, regardless of the prospects of economies
(whether international or domestic) or sectors as a whole.
Three basic elements involved in decision-making with the use of this
approach:
A. THE BUSINESS
B. THE VALUATION
C. THE RISK, where two types are distinguished:
1. Business or specific.
In which significantly influence the type of business, financial condition and
ability to increase profits and dividends.

2. From action or market.

Here we should pay special attention to two variables:
a) Volatility of the action
b) Share liquidity

The use of one method or another is largely determined by the type of

company you are analyzing and tradition in making investment decisions by
managers.
If it comes to countries or markets where price formation is not particularly
efficient (circumstance that occurs in so-called emerging markets), the focus
Top Down is much more useful in the sense that the macroeconomy are truly
govern the fate of the market and almost no investor is to analyze the
fundamentals of the companies if macroeconomic variables are not in favor
of a market rally.
This we have seen in any of the recent crises that have plagued emerging
countries and in most cases have been caused by macroeconomic factors. We
refer to any of the Asian crisis of 1997-1998, the Mexico of 1994 or the latest in
Brazil in 1998.
The Bottom-Up approach is much more common in developed countries and
markets in which macroeconomic risks are usually well controlled, or at least not
exhibit excessive variations in the short term.
The US case is the clearest in this regard, so that in this (the largest in the world by
far in terms of market capitalization and especially the number of listed companies)
may choose securities market and have more or less guarantee that your progress
will not be particularly influenced by macroeconomic variables and can present a
completely different market behavior, for better or for worse, as this statement is
true in both directions.1

THE PROCESS OF DECISION BASED IN FUNDAMENTAL ANALYSIS

COULD FOLLOW THESE STEPS:
1. FIRST STEP:
GLOBAL ECONOMY ANALYSIS: WHATS HAPPENING AROUND THE
WORLD?
The global economy will face a fight looking for gain momentum as many highincome countries continue to grapple with legacies of the global financial crisis and
emerging economies are less dynamic than in the past.
Global growth in 2014 was lower than initially expected, continuing a pattern of
disappointing outturns over the past several years. Growth picked up only
marginally in 2014, to 2.6 percent, from 2.5 percent in 2013. Beneath these
headline numbers, increasingly divergent trends are at work in major economies.
1 http://www.megabolsa.com/biblioteca/fundamental10.php

While activity in the United States and the United Kingdom has gathered
momentum as labor markets heal and monetary policy remains extremely
accommodative, the recovery has been sputtering in the Euro Area and Japan as
legacies of the financial crisis linger, intertwined with structural bottlenecks. China,
meanwhile, is undergoing a carefully managed slowdown. Disappointing growth in
other developing countries in 2014 reflected weak external demand, but also
domestic policy tightening, political uncertainties and supply-side constraints.
Several major forces are driving the global outlook: soft commodity prices;
persistently low interest rates but increasingly divergent monetary policies across
major economies; and weak world trade. In particular, the sharp decline in oil
prices since mid-2014 will support global activity and help offset some of the
headwinds to growth in oil-importing developing economies. However, it will
dampen growth prospects for oil-exporting countries, with significant regional
repercussions.
Overall, global growth is expected to rise moderately, to 3.0 percent in 2015, and
average about 3.3 percent through 2017. High-income countries are likely to see
growth of 2.2 percent in 2015-17, up from 1.8 percent in 2014, on the back of
gradually recovering labor markets, ebbing fiscal consolidation, and still-low
financing costs. In developing countries, as the domestic headwinds that held back
growth in 2014 ease and the recovery in high-income countries slowly strengthens,
growth is projected to gradually accelerate, rising from 4.4 percent in 2014 to 4.8
percent in 2015 and 5.4 percent by 2017. Lower oil prices will contribute to
diverging prospects for oil-exporting and -importing countries, particularly in 2015.

2. SECOND STEP:
STUDYING THE REGIONAL ECONOMIC BEHAVIOR: WHATS
HAPPENING IN SOUTH AMERICA? 2
Latin American economy moving at two speeds, although the region has
weakened, the performance of the most open economies has been better.
The trajectory of the Economies of Latin America is bifurcating as countries like
Peru, Colombia, Mexico and Chile grow faster than the global average, while
Argentina and Brazil face debilitating downturns.
Although the region has weakened, the performance of the most open economies
has been better.

2 http://www.americaeconomia.com/economia-mercados/finanzas/analisiseconomia-de-america-latina-avanza-dos-velocidades

The growth is best kept in Latin American countries have emphasized policies of
free market. The Chinese interest in natural resources has fueled a rise in raw
material prices.
According to an analysis by The Wall Street Journal, Latin America's economy is
growing at two speeds. Indicates that in general the region has tended to perform
well over the last decade, thanks to Chinese interest in natural resources area, the
economy is propelled with a rise in the prices of raw materials.
However, the global economic crisis in recent years has created a division between
countries that promoted more vigorously free trade reforms and kept a tight control
over public finances and exploited the wealth from the rise in prices commodities to
expand the role of government in the economy.
Although the region has weakened, the performance of the most open economies
has been better. Peru and Chile, for example, recorded growth of 6.5% and 5.7%,
respectively, in the third quarter compared to the same period last year, according
to latest information.
Colombia grew 4.9% in the second quarter and Mexico rose 4.2% in the first nine
months of the year compared to the same period in 2011, which is almost triple the
growth of Brazil. Argentina, however, grew just 2.4% in the first half, compared to
the same period last year.
"This region of two speeds will remain," said Neil Shearing, emerging markets
economist at Capital Economics Ltd. in London. "In a weaker global environment,
some of these economies have a relatively good performance compared to those
facing deep structural problems".
Peru, in particular, has had a remarkable career. He has averaged an annual
growth of around 6% in the last 10 years, the largest in Latin America, which has
allowed him to halve the poverty rate during that time to leave at 27%, according to
government statistics. Chile is not far, averaging an annual growth of around 4.5%
during the same period.
In Venezuela, where President Nicolas Maduro has nationalized much of the
private sector, the economy is headed for an expansion of 5% this year due to the
boost provided by higher public spending in the face of recent elections in which
Maduro was reelected. But many private economists predict that the country does
not grow or even into recession next year as the government tightens its belt.
While countries like Peru and Chile embraced free trade, Brazil used his position
as an exporter of raw materials to build and strengthen local industries to which it
protected by regulations and high tariffs on importations. The model worked,
roughly, when commodity prices soared after 2013. But these prices are now falling
and Brazilian strategy would be low.

Example oil industry: The case of the oil industry is illustrative. One of the largest
oil discoveries in the hemisphere in recent years generated optimism that a country
that is already the world's largest exporter of iron ore and other raw materials soon
become a global oil power.
But oil production this year may be lower than that of 2014. What happened? Brazil
enacted laws requiring state oil company Petroleum Brasileiro do most of the
exploration, and that local businesses get contracts to build ships and other
equipment needed to extract the oil from the ocean depths. The local industry,
however, is not large enough to take on a task of such magnitude
During the boom years of the raw materials, the leftist government swelled the
ranks of workers and spent heavily on public wages. The president, Dilma
Rousseff, has also implemented a series of stimulus measures to prop up the
economy, including a plan of US $ 66,000 million in August to invest in roads and
railways.
"Brazil should have recorded a higher surplus as a prosecutor for when growth
decelerates protection," said Shearing of Capital Economics. "Essentially you
removed all its raw materials from the earth to send to China and now needs more
savings and less spending, restructuring of public spending and welfare reform ...
which is not easy to implement."
Argentina, in turn, has recorded stellar growth in recent years that in 2011 reached
8.95%. But this has been accompanied by greater government intervention in the
economy and trade controls, which have increased under the government of
President Cristina Fernandez de Kirchner.
The government has initiated a series of controversial reforms, as an initiative to
restrict imports unless they are matched by exports. The idea is that companies will
use the dollars generated by exports to buy imported goods and, thus, reduce the
outflow of dollars. He has not had that effect.
Protectionist measures damage the trade and industry in Argentina, economists
say. "They create jobs and demand in the short term, but is not sustainable as
companies develop only as a result of the regulations, rather than innovation," says
Daniel Hoyos, an economist at the National University of Central Buenos Aires.
Mexico, the second largest economy in the region, it seems better positioned to
grow in the coming years, with a strong manufacturing base, which means that its
economy does not depend on the high price of raw materials to grow and that
would benefit from rising of wages in China, economists point out. Mexico exports
more manufactured than all other countries combined region.

For Mexico, further expansion would be a kind of vindication after years being
compared negatively with Brazil. "Everything we heard in recent years was Brazil,
Brazil, Brazil," said current Foreign Secretary Jose Antonio Meade in an interview.
"But when you see everything from inflation to debt ... we had much better
macroeconomic figures".3
3. THIRD STEP:
STUDYING THE COUNTRY: WHATS HAPPENING IN COLOMBIA?
In Colombia the expectations about the behavior of the BANCO DE LA
REPUBLICA is to keep the interest rate into 4,5 percent all 2015, it perspective can
change if the oil prices will fall deeply and the fiscal perspectives will gone bad , in
this case probably the interest rate will be at 4 percent
The global economic grow is deteriorated more since the end of 2014 accordingly
the el FMI took a look about 2015 global PIB expectations from 3,8% to 3,5%, a
Little bit above of the 3,3% estimated the last year
In Colombia we expect a slow decrease of the PIB from 4,8 % in 2014 to 4% in
2015 but with high risks of decrease. This situation happens for the continuous
reduction of oil prices because those prices lost 35 percent in the last 3 months.
The exchange terms of international negotiations are much damaged because the
fall of the oil prices because the oil prices participation are high in the external
accounts of Colombia. This damage will make a negative impact against the
national incomes affecting the local demand.
We expect that the internal demand slow will concentrate in fixed investments,
because we expect a negative impact but moderated, of the taxes reform of 2014,
while the devaluation will affect the capital goods importations
The private consumption will slow less, but the devaluation will play an important
role in his weakness because the families will lose dollars purchasing power,
affecting the imported consumption goods. On the other hand, the unemployment
rate could be near of the long term structural level, which will make issues to the
profits associated with the employment levels growth
Finally we expect that the public consumption will be moderated in 2015 for an
important reason: the government will face a stage with less revenues of the oil for
the years to come even if the hugest impact will be felt just since 2016

3 http://www.americaeconomia.com/economia-mercados/finanzas/analisis-economiade-america-latina-avanza-dos-velocidades

However, the internal demand brings a good behavior from several months ago
and the new government projects helping the building sector will contribute to
compensate part of the internal demand slow.
About inflation, we still believe that will close the 2015 under the 2014 level,
because the internal demand weakness and a less oil prices
We expect that the inflation will be above of 3, 5 % the first semester and will be
close to 4 %, because of the devaluation, the inflation at the end of 2014 can be
near of 3, 6%.
Taking a look around the Colombians neighbors we have to pay important
attention to Venezuela situation, it is important because Venezuela has a very huge
economy because the oil production and is the second commercial partner of
Colombia after EEUU.
The political situation brought problems to Colombian exporters because
Venezuela government with their regulations (with (CADIVI) (Comisin
Administracin de Divisas) for example) made a late payments structure
several years (almost since Chavez took the presidency) and this fact affect
only Colombia but also all the commercial partners of Venezuela

the
de
for
not

All that stuff is something that we can appreciate with the Venezuela lack of food
into the supermarkets because nobody wants to sell their products because the
fear of late payments.
The region have also Ecuador, Peru, Brazil and Panam around Colombia but
those countries arent a big commercial partners, maybe Ecuador sell good
amounts of sea food to Colombia, those countries doesnt have big troubles that
affect the commerce with Colombia probably Ecuador that have some equal
Venezuela thoughts but without the deeply internal conflict.

With Colombia we can appreciate some important things:

External investments are growing and the peace conversations with guerrilla
can increase it because the fear of investors can disappear for good.
The inflation stability is symptom for macroeconomic health
Colombia have good growing behavior for several years

Colombia have already exceed us$ 100.000 million (25,3% of annual PIB)
but it isnt bad if we compare this with European countries that are in crisis
with the 100% or more of his PIB in external debt
Stock market trends for investments decision

Trends analysis
The investors can make qualitative and quantitative analysis of trends to have
good information about the companies that stay in the Colombian stock market an
according with their risk appetite make a right investment
stock
COLOMBIA COLCAP INDEX

XITO

PFDAVVNDA

PFBCOLOM

BVC

CNEC

CEMARGOS

CORFICOLCF

ECOPETROL

ETB

PFAVAL

GRUPOSURA

NUTRESA

ISA

ISAGEN

PREC

TABLEMAC

PFAVH

CLH

EEB

PFHELMBANK

PFGRUPSURA

BCOLOMBIA

BOGOTA

Very Short term

Short term

Middle term

Long term

stock

Very Short term

Short term

Middle term

Long term

CELSIA

CONCONCRET

ELCONDOR

ENKA

MINEROS

ODINSA

PFCARPAK

PFCORFICOL

VALOREM

OCCIDENTE

PFCEMARGOS

SDCORFIC

SDPFCORF

GRUPOAVAL

GRUPO ARGOS SA

GRUPO ARGOS-PRF

COLOMBIA COLEQTY INDEX

COLOMBIA COLSC INDEX

COLOMBIA COLIR INDEX

ICOLCAP

Profits and risks analysis

1 day
profitabilit
y

1 month
profitabilit
y

3 months
profitabilit
y

1 year
profitabilit
y

Short
term risk

Middle
term risk

Long
term risk

COLOMBIA
COLCAP
INDEX

1,93%

-2,76%

-11,79%

-16,36%

1,67%

1,63%

1,58%

XITO

1,20%

2,43%

-12,15%

-8,07%

3,36%

3,05%

2,73%

stock

PFDAVVNDA

2,21%

-2,05%

-6,98%

5,90%

3,41%

3,24%

3,07%

PFBCOLOM

2,36%

0,78%

-8,39%

-1,44%

2,70%

2,41%

2,11%

BVC

1,14%

-8,29%

-10,61%

-19,55%

3,33%

3,16%

2,99%

CNEC

5,75%

13,22%

22,55%

-50,79%

7,27%

7,73%

8,20%

CEMARGOS

0,70%

-4,13%

-14,95%

-12,35%

3,22%

3,14%

3,05%

CORFICOLCF

1,74%

-3,20%

-7,40%

1,34%

2,76%

2,33%

1,90%

ECOPETROL

1,27%

-4,08%

-2,44%

-44,44%

3,59%

3,59%

3,60%

ETB

-0,18%

-2,16%

5,03%

33,42%

1,82%

2,23%

2,64%

PFAVAL

2,15%

-2,86%

-6,67%

-4,03%

2,22%

2,07%

1,91%

GRUPOSURA

1,91%

-2,40%

-14,11%

-1,44%

2,51%

2,43%

2,36%

NUTRESA

0,26%

-5,20%

-20,83%

-12,37%

1,99%

1,92%

1,86%

ISA

3,10%

-1,92%

-7,26%

-6,01%

1,91%

2,33%

2,74%

ISAGEN

1,64%

6,16%

5,08%

-1,90%

1,69%

2,18%

2,67%

PREC

8,87%

-9,76%

-55,77%

-78,96%

7,30%

7,94%

8,57%

TABLEMAC

0,00%

8,00%

7,14%

-25,00%

9,08%

6,72%

4,37%

PFAVH

0,95%

-3,14%

7,40%

-7,50%

2,94%

2,72%

2,49%

CLH

-0,74%

-10,67%

-16,15%

-16,46%

2,55%

3,02%

3,49%

EEB

1,25%

-0,61%

-5,52%

11,30%

1,63%

1,94%

2,24%

PFHELMBANK

0,19%

1,51%

4,47%

7,60%

0,26%

1,05%

1,85%

PFGRUPSURA

1,49%

-2,58%

-12,19%

-5,03%

2,81%

2,53%

2,25%

BCOLOMBIA

0,51%

-3,56%

-2,06%

17,62%

3,15%

2,75%

2,35%

BOGOTA

2,32%

-8,73%

-13,11%

-18,05%

2,51%

2,19%

1,87%

CELSIA

0,00%

-5,29%

-17,86%

-13,13%

2,62%

2,47%

2,33%

CONCONCRET

1,69%

0,67%

-3,54%

16,28%

2,84%

2,53%

2,23%

ELCONDOR

0,00%

-3,57%

16,55%

8,00%

1,94%

2,39%

2,85%

ENKA

0,00%

-3,94%

10,91%

35,56%

2,81%

3,79%

4,78%

MINEROS

2,01%

-2,96%

-0,54%

-24,73%

3,13%

3,34%

3,56%

ODINSA

-0,94%

2,69%

7,69%

-7,69%

1,23%

1,92%

2,61%

PFCARPAK

2,50%

-1,40%

-26,68%

-44,09%

5,58%

4,91%

4,24%

PFCORFICOL

0,00%

1,22%

7,60%

19,80%

2,84%

2,63%

2,42%

VALOREM

0,27%

5,68%

18,10%

16,98%

3,01%

3,38%

3,75%

OCCIDENTE

0,00%

3,19%

5,53%

35,48%

0,86%

1,11%

1,36%

PFCEMARGOS

-3,50%

6,75%

-8,10%

8,67%

3,57%

2,97%

2,38%

SDCORFIC

0,00%

0,00%

0,00%

0,00%

2,92%

2,92%

2,92%

SDPFCORF

4,00%

0,00%

0,00%

0,00%

6,27%

6,27%

6,27%

GRUPOAVAL

2,57%

5,28%

-1,06%

0,72%

2,49%

2,14%

1,79%

GRUPO
ARGOS SA

-0,92%

-6,32%

-13,74%

-11,34%

3,40%

3,09%

2,77%

GRUPO
ARGOS-PRF

-0,35%

0,53%

-0,18%

0,98%

2,92%

2,87%

2,82%

COLOMBIA
COLEQTY
INDEX

0,96%

-4,94%

-10,26%

-12,16%

1,50%

1,48%

1,45%

COLOMBIA
COLSC INDEX

0,12%

-1,80%

-2,15%

-6,79%

1,50%

1,37%

1,24%

COLOMBIA
COLIR INDEX

0,98%

-4,93%

-10,10%

-11,52%

1,53%

1,51%

1,49%

ICOLCAP

-0,62%

-2,56%

-4,87%

-7,18%

1,68%

1,52%

1,36%

4. THE FIRMS

ARGOS GROUP

Argos Group makes equity investments in companies that convert resources into
products and services with high added value for the development of the basic
sectors of the economy. Its subordinate companies have a presence in several
countries of the American continent, with active participation in the cement
business, energy, urban and housing and port development. Argos Group Inc. is
the controlling shareholder of Cementos Argos SA, Celsia SA E.S.P., Sator H.S.H.
and Situm S.A.S .; also owns 50% of Compas Inc.

Strategic Investments
The value of strategic investments Argos Group at the end of 2012 was distributed
in 54% BUSINESS cement, 18% in energy, 22% in real estate, 3% for coal and 3%
in the port.
Investment Portfolio
Argos Group has investments in the finance portfolio through Sura and
Bancolombia Group, and food, through Nutresa Group. At December 31, 2012,
portfolio investments amounted to 7.1 billion pesos.

Creating shareholder value is given from diversifying their investments, with a solid
portfolio and strategic investments in diversified sectors where mature businesses
are combined and structured NEW BUSINESS, which show great potential for
growth. This, framed within the Argos Group imprint that puts all companies in
which it invests: commitment to sustainability in its three dimensions - economic,
environmental and social - and applying the highest standards of corporate
governance.
By investing in Argos Group, shareholders enjoy the opportunity to participate in
the growth and profitability of businesses with high potential and dynamism as the
port and the housing, in which could not invest directly in the stock market of
Colombia. In addition, perceived risk mitigation and volatility of these business
developments through security clearance and deliver mature business that invests
in the Group (the cement and energy).
Ownership Structure
Argos Group is a publicly traded company whose capital is divided into shares that
are listed on the Bolsa de Valores de Colombia.
It has an authorized capital of COP $ 75,000,000,000 divided into 1,200,000,000
shares of nominal value of COP $ 62.50. The paid-in capital is USD $
49,869,058,187.50 represented in 651,102,432 ordinary shares of which there are
5.702.432 shares repurchased, so the total number of ordinary shares outstanding
is 645,400,000.
Additionally, the Company has 146,802,499 preferred shares, par value USD $
62.50, for a total of 792,202,499 shares outstanding.
The following graphs show the corporate structure of the Company as at
September 30, 2014:
ACCIN ORDINARIA

ACCIN PREFERENCIAL

ACCIN ORDINARIA
ACCIONISTA

ACCIONES POSEIDAS

Grupo
de
Inversiones
Suramericana S.A.

229.384.477

Grupo Nutresa S.A.

79.804.628

Fondo
de
Obligatorias
Moderado

Pensiones
Porvenir

35.972.181

Fondo
de
Obligatorias
Moderado

Pensiones
Proteccin

30.047.320

Amalfi S.A.

25.413.923

Fondo Burstil
COLCAP

Ishares

14.435.460

Inversiones El Yarumo S.A.

14.003.382

Fondo
de
Pensiones
Obligatorias Colfondos

13.809.566

Fundacin
Beneficio

13.598.775

para

el

JMRV & Ca. Sociedad en

Comandita por Acciones

6.050.000

Fundacin
Medelln

5.060.000

Fraternidad

Fondo
de
Pensiones
Obligatorias Skandia

4.510.139

ACCIN ORDINARIA
ACCIONISTA

ACCIONES POSEIDAS

Uribe de Arango
Cristina

Mara

PARTICIPACIN

4.005.503

0,62%

2.900.505

0,45%

2.756.924

0,43%

Arango Uribe Olga Isabel

2.750.628

0,43%

Ishares MSCI Emerging

Markets Index Fund

2.696.058

0,42%

Arango Uribe Ana Cristina

2.671.752

0,41%

Subfondo Barclays Global

Investors Services N.A.

2.400.072

0,37%

Fondo Fidelity Investment

Trust Latin America Fund

2.259.082

0,35%

Abu Dhabi
Authority

Investment

Arango
Uribe
Mercedes

Mara

Information September 30 de 2014

ACCIN PREFERENCIAL
ACCIONISTA

ACCIONES POSEIDAS

PARTICIPACIN

Fondo
de
Obligatorias
Moderado

Pensiones
Proteccin

35.707.112

24,32%

Fondo
de
Obligatorias
Moderado

Pensiones
Porvenir

22.594.111

15,39%

12.984.184

8,84%

Amalfi S.A.

ACCIN PREFERENCIAL
ACCIONISTA

ACCIONES POSEIDAS

Fondo
de
Obligatorias
Moderado

Pensiones
Colfondos

PARTICIPACIN

7.930.722

5,40%

Fondo
de
Pensiones
Obligatorias Skandia

2.784.932

1,90%

Porvenir S.A.

2.738.383

1,87%

Fondo
de
Pensiones
Voluntarias Proteccin

2.644.771

1,80%

Azurita S.A.

1.761.926

1,20%

Conscar & Ca. S.C.A.

1.678.481

1,14%

Inversiones Gloscar S.A.S.

1.427.663

0,97%

Lipu & Ca. S.C.A

1.423.039

0,97%

JMRV & Ca. Sociedad en

Comandita por Acciones

1.393.765

0,95%

Fondo
de
Obligatorias
Retiro

1.135.954

0,77%

Norges Bank

1.124.396

0,77%

Ishares
Markets

1.084.452

0,74%

Fondo
de Cesantas Proteccin

1.055.103

0,72%

Fondo
de
Obligatorias
Mayor RI

Pensiones
Proteccin

1.049.039

0,71%

Abu

Investment

1.005.413

0,68%

Pensiones
Proteccin

MSCI Emerging
Index
Fund

Dhabi

ACCIN PREFERENCIAL
ACCIONISTA

ACCIONES POSEIDAS

PARTICIPACIN

Authority
Subfondo Barclays Global
Investors Services N.A.

977.950

0,67%

Fondo
de
Pensiones
Obligatorias Porvenir

886.527

0,60%

Information September 30 de 2014

AVAL GROUP

Grupo Aval is the largest in Colombia and one of the leading banking groups
in Central America, which offers a wide range of financial services from a
platform based on seven distinct brands in Colombia and Central America
Financial Group.

Source: Grupo Aval. Participation rates correspond to political rights at

December 31, 2013.

(1) Corficolombiana maintains an additional 0.4% in the West Bank December 31,
2013 due to the merger of Leasing de Occidente with the West Bank in June 2010.
It is expected that this participation is sold in open market operations. (2) Porvenir,
Corficolombiana and BAC are subsidiaries of Banco de Bogot. The results of
these entities are consolidated in the financial statements of Banco de Bogot.
Includes direct and indirect interest
Mission
Grupo Aval's mission is to provide our customers socially responsible, safe, easy
financial solutions to access, understand and manage at any place and time
required, through legal vehicles available in each of our markets; These solutions
should be also profitable for our customers and for our companies and thus lead to
creating value for our shareholders.
View
Become one of the three leading financial groups in Latin America, offering
portfolios of products and services that enable our customers to manage all your
finances with us and integrated manner while maximizing the value of your
investment to our shareholders from the trust our strength and consistent
profitability.
Values
Our focus and duty is to our customers, which will protect your assets as our own
and help them to have the right financial solution according to their needs.
The well-balanced risk where the risk / return equation maintain the Group for
safekeeping and level of robustness that customers expect from him is optimized.
We never compromise our integrity obeying and respecting the laws of each
geography in which we operate.
As a representative financial entity in each market where we operate, we will be
an exemplary contributor to the community mainly through financial education
programs.
Our greatest asset is our people, and we are committed to attracting, retaining
and developing the best talent. We are focused on meritocracy.
Cultivate teamwork, give incentive for continuous improvement of our operations
and share best practices developed in every corner of the Group to improve our
efficiency.
We seek continuous innovation to be the first to present creative solutions and
good technological support to meet the financial needs of our customers.

Why Grupo Aval action in the US rose and fell in Colombia?

A Colombian company's enlisted in the flagship of the world stock market, as the
Aval Group announced Tuesday successfully completed its public offering of
preferred shares offered in the form of American Depositary Receipts (ADR) listed
on the NYSE.
Also, according to a document released by the conglomerate to the Financial
Superintendence of Colombia, "as a result of the offer the company approved the
placement of 1,874,074,000 preferred shares for US $ 1,265 million." The Group
also explained that each ADR, a portfolio comprised of 20 preferred shares were
subscribed at a price of $ 13.50, and it began to be traded Tuesday on the floor
under the symbol AVAL.
The first day of action in New York Grupo Aval was stable up since it closed at a
price of US $ 13.58, i.e. it grew 0.58%. This Cesar Cuervo analyst Credicorp is
because "the Colombian company has investment potential in the US, so there is
no reason to believe that the title shows a laggard behavior."
For David Seconi, Alliance Securities analyst, "the entry of Grupo Aval the US
stock market is positive for shareholders, as the regulatory laws are stricter in the
US than in Colombia, so it should be more enjoyable with investors ".
However in Colombia is another story, as the preferential action of Grupo Aval
Monday fell 1.7% and 4.2% Tuesday. Also, your ordinary title also presented
devaluations in the past two days as decreased from 0.70% and 3.5%,
respectively. So that is relevant should ask what this behavior so different in both
stock markets should.
According to Seconi: "Given that the price at which opened the ADR, that New York
was $ 13.5, and if this value is transformed by the exchange rate that prevailed on
Monday it can be concluded that the value of degree is lower in the US than in
Colombia. So the fall of the BVC active in the past two days due for a correction in
prices between the two countries stock markets ".
It is a position that shares Cuervo because he believes "that the correction in
prices between the two markets is what explains the disparities recovery.
Furthermore, although the exchange rate should be monitored, it is likely that it is
closing, because the last day falls are sufficient to level the two quotes and
because the asset's performance of Grupo Aval US was constant and even
positive in its first day. "
That is why the behavior of local asset and internment of Grupo Aval have a close
relationship in terms of recovery, so that the future of the action that is listed on the
BVC depends on the behavior that this has on the NYSE.

Also, consider that a Colombian actor best you reach the NYSE could increase
competition among local companies. Based on this Cuervo recognizes that "due to
regulation there about investment quotas in the US stock market, there may be
some movement between Bancolombia and Grupo Aval, but usually foreign funds
have large amounts of capital to spend, so the struggle for participation levels of
the other national corporations would not be a constant thing. "
SOUTH AMERICAN INVESTMENT GROUP S.A
It is a multilatine holding company with about 70 years of experience and strategic
investments in the banking, insurance, pensions, savings and investment.
They also have portfolio investments in the sectors of processed foods, cement,
energy, real estate, mining and ports.
Grupo Sura has twice awarded international investment grade by Standard and
Poor's and Fitch Ratings.
Shareholding structure (ord. + Pre.) September 2014
South American Investment Group as a company, does not produce goods or
services, but invests in shares of companies if they do. Their "product" is a solid
investment portfolio represented in the action of South American Investment
Group, which is traded on the stock exchange under the symbol GRUPOSURA's
Colombia and offers its shareholders dividends and profitability.
Financial Summary
Alcance de la
2009
cobertura

2010

2011

2012

2013

Ingresos
Operacionale 516,918
s (COP$ MM)

800,523

461,929

668,879

924,511

Utilidad Neta
446,050
(COP$ MM)

696,266

332,735

546,100

781,794

Activos
(COP$ MM)

14,695,316 18,168,610 21,590,398 21,680,178 21,050,300

Patrimonio
(COP$ MM)

14,338,307 17,561,191 18,864,467 20,791,860 20,287,518

Utilidad
Accin
(COP$)

951

por
1,484

578

949

1,358.8

Precio
Cierre
(COP$)

de
Ord. 24,540

37,480

31,100

38,000

33,700

Precio
Cierre
(COP$)

de
Pref. -

33,000

39,000

34,980

37,441

32,787

36,136

35,260

Valor
Intrnseco
(COP$)

30,570

Capitalizaci
n
Bursatil 11,510,174 17,579,517 18,547,059 21,970,479 19,526,153
(COP$ MM)
Acciones en 469,037,26 457,037,26 575,372,22 575,372,22 575,372,22
Circulacin
0
0
3
3
3
Nmero
de
8,147
Accionistas

7,651

31,713

25,455

21,898

Nmero
de
19
Empleados

19

32

42

45

Why invest in GRUPOSURA's?

Because it has a strong financial position to together with its strategic vision
continuously generate value for shareholders.

Because we seek that all companies belonging to our portfolio are profitable and
enjoy a leading position in their markets, and to invest in them, contribute to the
development of business in Colombia and the region, reaching more than 35
countries.
Because we are always looking to innovate, we are the first company in Colombia
to issue bonds to 40 years, first to sell options on your own PORTFOLIO
INVESTMENT, and the only issue domestic and international bonds, shares and
securities in the last three years.

 Because we have presence in the domestic market, Colombia Stock Exchange

and in international markets, ADR Level I in the United States and LATIBEX, Latin
MARKET VALUES in the Madrid Stock Exchange.
Because it has a Code of Good Governance in line with international practices to
protect the interest of minority shareholders
Because we have a policy of responsibility and corporate citizenship that enables
us to meet the highest standards in relation to social, environmental, economic and
governance areas, this has allowed us to enter the Dow Jones Sustainability Index.
Report GRUPOSURA's Action

Dividends
The General Shareholders' Meeting of Grupo de Inversiones Suramericana held
last March 27, 2014, decided to increase the annual dividend per share of COP
COP $ 339 to $ 390, payable in four installments of COP $ 91.50 each. Also the
preferred share dividend is COP $ 682.50, payable quarterly.
.
REFERENCES

Banco mundial ( web site)

Bolsa de valores de Colombia (web site)

Porfolio magazine

http://inversionistas.grupoargos.com/perfil-corporativo/quienes-somos

https://www.grupoaval.com/wps/portal/grupo-aval/bienvenido/investorrelations/

24 de septiembre de 2014, Camilo Vega Barbosa.

http://www.elespectador.com/noticias/economia/accion-del-grupo-avalsubio-eeuu-y-cayo-colombia-articulo-518447