Asian Investment Conference 2015 - Credit Suisse

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31 March 2015

Asia Pacific

Equity Research

Strategy

Asian Investment Conference 2015

COMMENT

Key macro and company takeaways

Figure 1: Tone of corporate presentations at the AIC

Source: Credit Suisse research

■ We just concluded our week-long Asian Investment Conference (AIC) in

Hong Kong. With over 1,200 institutional investors attending the conference,

310 corporates providing their unique insight and with over 110 keynotes

and panel session speakers who shared their wisdom at the forum, this

18th AIC was amongst the biggest gathering of investors that Credit

Suisse has ever arranged in Asia. Our thanks to all the attendees who

made this event a success.

■ Our analysts were able to attend the presentations and group meetings for a

number of companies and in this note we provide the summary highlights from

these corporate meetings. The bullish mood of the investors noted during our

AIC sentiment survey (click here) also showed up at the company level where

62% of the companies (that our analysts attended the meetings for) sounded

positive against 38% that sounded negative or neutral in their outlook relative

to the prevailing views in the market (note that companies usually tend to

sound more positive than neutral about their business outlook). This is in

contrast to the mixed tone present at our last AIC, where only 52% were

positive, and 48% were negative or neutral.

■ This year we also had our largest and arguably the most impressive

repertoire of key note speakers. If you missed some of those, you could

watch them by clicking on this link AIC Keynotes.

61.8%

31.3%

6.9%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

Positive Neutral Negative

Research Analysts

Manish Nigam

852 2101 7067

[email protected]

Mujtaba Rana

852 2102 6305

[email protected]

https://doc.research-and-analytics.csfb.com/docView?language=ENG&source=ulg&format=PDF&document_id=1046449371&serialid=OtjfLyJxHutaMVjqbUQxlDJl0AOzcuLRV2Vep7ZIAmk%3d

https://www.credit-suisse.com/sites/conferences/aic/en/media-hub/virtual-aic.html?WT.mc_id=apac_conf_aic_2015_email_na_asiandailystatswrap_na_na_en

31 March 2015

Asian Investment Conference 2015 2

Focus charts Figure 2: Tone of corporate presentations at the AIC, by country

Source: Numbers in brackets indicating the total number of companies; Source: Credit Suisse research

Figure 3: Tone of corporate presentations at the AIC, by sector

Note: Numbers in brackets indicating the total number of companies; Source: Credit Suisse research

0%10%20%30%40%50%60%70%80%90%

100%

Chin

a (1

4)

Hong K

ong (

26

)

India

(9

)

Indonesi

a (1

0)

Japan

(7

)

Kore

a (6

)

Mal

ays

ia (

8)

Phili

ppin

es

(5)

Sin

gap

ore

(5)

Tai

wan

(9

)

Thai

land (

3)


0%10%20%30%40%50%60%70%80%90%

100%

Consu

mer

(26)

Energ

y (4

)

Fin

anci

als

(8)

Gam

ing (

5)

Health

care

(3)

Indust

rial

(8

)

Mat

eria

ls (

5)

Pro

pert

y (8

)

Tech

nolo

gy

(24)

Tele

com

s (2

)

Tra

nsp

ort

(5)

Util

ities

(4)


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Table of contents Focus Charts 2 Keynote & Analyst Presentations 6

Asia Technology Strategy 7 China Internet & New Media Expansion 7 Doing business in China, what is the reality? 8 Elephants can dance, and for very long 8 Geopolitical risks 10 Health check on global economy 11 Hong Kong: A Bright Future 12 Indonesian Challenges 12 Indonesia Central Bank 13 New governance in China – maintaining the rule of law 14 The new energy reality 15 The War on Graft 15 When will frontier markets prove rewarding to investors? 16 Will HK remain a compelling investment destination? 17

Company Presentations 18 AirAsia X (AIRX.KL) 19 Ajisen (0538.HK) 19 ASM Pacific (0522.HK) 20 Astra (ASII.JK) 21 AUO (2409.TW) 21 Ayala Land, Inc (ALI.PS) 22 Baidu (BIDU.OQ) 23 Bank Central Asia (BBCA.JK) 23 BASF (BASFn.DE) 24 Bharti Infratel (BHRI.BO) 25 BLOOM (BLOOM.PS) 25 Blue Bird (BIRD.JK) 25 BTS Group Holdings (BTS.SK) 26 Bumi Armada (BUAB.KL) 27 Cheung Kong Infrastructure (1038.HK) 28 China Animal Healthcare (0940.HK) 28 China Gas Holdings (0384.HK) 29 China Lodging (HTHT.OQ) 29 China Resources Cement (1313.HK) 30 China Resources Power (0836.HK) 30 China Shenhua (1088.HK) 31 Chow Tai Fook (1929.HK) 31 CIMB (CIMB.KL) 32 CTBC Holding (2891.TW) 32 Ctrip (CTRP.OQ) 33 Dawnrays Pharmaceutical (2348.HK) 33 Delta (2308.TW) 34 Dr. Reddy’s (REDY.BO) 34 DSN (DSNG.JK) 35 EDU (EDU.N) 36 Gajah Tunggal (GJTL.JK) 36 Genting Singapore (GENS.SI) 37 Globe Telecom (GLO.PS) 37 HCL Technologies (HCLT.NS) 38 HDFC Bank (HDBK.BO) 38 HDFC Ltd (HDFC.BO) 39

31 March 2015


Hollysys (HOLI.OQ) 39 Homeinns (HMIN.OQ) 40 Hong Kong Electric Investment (2638.HK) 41 HTC (2498.TW) 41 Huaneng Power International (0902.HK) 42 IDFC Ltd (IDFC.BO) 43 IJM Corporation (IJM MK) 43 Indofood Agri (IFAR.SI) 43 Indofood CBP (ICBP.JK) 44 Inotera (3474.TW) 45 JMEI (JMEI.N) 46 JSR (4185.T) 46 KEPCO (015760.KS) 47 Las Vegas Sands (LVS) / Sands China (1928.HK) 47 Lenovo (0992.HK) 48 LG Chem (051910.KS) 48 LG H&H (051900.KS) 49 Lifestyle (1212.HK) 50 Lippo Karawaci (LPKR.JK) 50 LT Group (LTG.PS) 52 Luk Fook (0590.HK) 52 Matahari Department Store (LPPF.JK) 53 Maxis (MXSC.KL) 54 Mediatek (2454.TW) 54 Melco Crown (MPEL.OQ) 55 Midea (000333.SZ) 55 Mitsubishi Chemical Holdings (4188.T) 56 MPPA (MPPA.JK) 56 NagaCorp (3918.HK) 57 Neptune Orient Lines (NEPS.SI) 58 NetEase (NTES.OQ) 58 Nine Dragon Paper (2689.HK) 59 NYK (9101.T) 59 Orient Overseas International (0316.HK) 60 OSIM International (OSIL.SI) 61 PTT (PTT.BK) 61 Qihoo (QIHU.N) 61 RHB Capital (RHBC.KL) 62 Robinsons Land Corp (RLC.PS) 62 Sa Sa (0178.HK) 63 Samsung C&T (000830.KS) 64 Sembcorp Industries (SCIL.SI) 64 Showa Denko (4004.T) 65 Shriram Transport Finance (SRTR.BO) 65 SK Hynix (000660.KS) 65 S-Oil (010950.KS) 66 SJM (0880.HK) 67 Skyworth Digital (0751.HK) 67 SMIC (0981.TW) 68 SPIL (2325.TW) 69 Stella (1836.HK) 69 Summarecon Agung (SMRA.JK) 70 TAL (TAL.N) 71 Tata Consultancy Services (TCS.BO) 71 TCL (000100.SZ) 72 Texhong Textile (2678.HK) 72

31 March 2015


Thai Beverage (TBEV.SI) 73 Tokuyama (4043.T) 73 Toshiba (6502.T) 74 Tosoh (4042.T) 74 TPK (3673.TW) 75 TSMC (2330.TW) 75 Tsui Wah (1314.HK) 76 TUF (TUF.BK) 77 Tune Insurance (TUNE.KL) 77 Ultratech / Grasim (ULTC.BO / GRAS.BO) 78 VGI Global Media (VGI.BK) 78 Visi Media Asia (VIVA.JK) 79 Waskita (WSKT.JK) 80 Weibo (WB.OQ) 80 Westports Bhd (WPRT.KL) 80 Wilmar (WLIL.SI) 81 Xiabu Xiabu (0520.HK) 82 YY (YY.OQ) 82 Zhaopin (ZPIN.N) 82 Zijin Mining (2899.HK) 83

31 March 2015


Keynote & Analyst Presentations

31 March 2015


Asia Technology Strategy

Speaker: Manish Nigam

New News: N/A

Tone: Bullish (on China Internet + Indian IT)

Summary: An extraordinary process of technological advancement has occurred in the

past decade – almost all of it being (in some way) manufactured out of Asia. The

consumer tech cycle has been the most apparent in this growth. We recommend a switch

from hardware and semis to software and Internet, specifically India and China.

CYCLE: Consumer tech cycle very different to others in that the very high end, very high

ASP product cycle has lasted eight years (consistent QoQ out performance since 3Q 11).

A significant base effect.

PCs: Have stabilised and grew positively in 1Q last year, but momentum in the last quarter

is beginning to roll over as replacement cycle now plateaus out.

SMARTPHONES: Vast majority who can afford a smartphone now own one, therefore unit

growth will fall rapidly.

The underpenetrated can largely only afford a low ASP product, so overall average prices

to come down

MARGINS / EARNINGS: Component manufacturing making the highest margins they've

ever made, with their customers (handset OEMs) making their lowest: not fundamentally

sustainable.

Korean semis, in particular, have gone from 40% EPS growth in 2014 to 0% in 2016, hard

to argue this sector will outperform.

CHINA: Still the fastest grower in 2015, with 25% top-line CAGR over next five years.

Death rate, however, will be high compared to Indian IT (top five companies now,

expected to be top five in a few years' time).

China Internet & New Media Expansion

Speaker: Dick Wei

New News: None

Tone: Bullish

Key points:

Increasing user growth seen consistently for 7 yr, with penetration just reaching world

average.

Mobile Internet counts for much of this: further growth here will unlock huge potential in e-

commerce.

Demographics tailwind to benefit online economy.

Top 15 mobile apps completely dominated by Tencent, Baba, Qihoo and Baidu

MOBILE:

64% of traffic comes from mobile, but revenue contribution only stands at 43%

We expect 60% YoY mobile game growth in 2015

Mobile ad revenue lowest in Asia-pac (around a sixth of US, for Facebook and twitter)

Tencent ad around $2.3 vs $8 for Facebook.

E-COMMERCE:

31 March 2015


Mobile shipping GMV to account for 16% of total online shopping by end 2016.

Conversion and payment are two biggest roadblocks.

F&B, health goods and medical services all underpenetrated in online.

LOCAL SERVICES:

User demographics shifting beyond gamers, and improved monetisation model in play.

Dianping strong in group buy sector.

O2O services should capture the next $100bn of growth.

There will likely be a battle between comprehensive and vertical start-ups in 2015.

Doing business in China, what is the reality?

Speaker: Bertrand-Marc(Marc), Allen, President, Boeing International, Robert

Buchbauer, Member,Executive Board, and CEO Consumer Goods,

Swarovski, Jörg Wuttke, President, European Union Chamber of

Commerce in China

New News: None

Tone: Positive

Growth pattern of China differentiated a lot from past years. China used to maintain a high

GDP growth across the country, but for now, economic growth patterns vary province by

province. Northeast region may suffer most, while the costal and southern areas can still

maintain a robust growth.

Although they admitted a slowdown in China's economic growth, Allen and Robert still

believe there is huge potential for them to expand market in China.

The regulatory enviornment of China is mixed and need to be judged sector by sector. For

aviation, Allen believed that government control exempted companies in this sector from

suffering overcapacity. And Robert gave a few examples to show that the impact of

government regulations on foreign companies depends on how enterprises react. But

overall, Jörg argues that the golden years for foreign capital to develop business in China

was during Zhu Rongji era, which is already past.

All the three welcomed competition with local players, and they believe competition is the

source of innovation and efficiency, the driver of better management and industry

consolidation.

Elephants can dance, and for very long

Speaker: Dr. Duvvuri Subbarao Distinguished Visiting Fellow, National

University of Singapore Business School; former Governor, RB

New News: None

Tone: Positive

What is the most important factor for growth?

India requires a phenomenal increase in investments, as was the case when the GDP was

growing at 9%-plus. The slowdown, at least as per the old series, has been led by the

slowdown in investment. On the surface the 38% of GDP investment rate may have fallen

to 34%, a relatively minor fall, but a lot of the investment is going into hard assets and gold.

So the slowdown in productive investment is large.

31 March 2015


What is the challenge in infrastructure investment?

There are two challenges:

Policy challenges: the optimism around PPP has melted away from both the

government (charges of crony capitalism) and the private sector (over-leverage,

delayed projects). This budget tried to address some of these issues.

Financing challenges: ~US$1tn is required to finance this infrastructure over the next

five years (almost double the current rate). But the government does not have the

money. The private sector also struggles because there is no long-term finance

market in India. The government and the RBI are trying to develop the bond market

but it has not grown at the expected pace. Banks had to step in, but they are not

geared to take these risks. The RBI has bent over backwards trying to accommodate

the challenge, but going any further is very risky.

Why is "Make in India" the central theme of Mr. Modi's policy?

India needs to create hundreds of millions of jobs. This cannot happen through agriculture

- in fact, with improving productivity, agriculture will throw out people. Services cannot

scale at that level. However, India cannot replicate the China model for two reasons:

China opened up in the 80s and 90s, when the rich world was growing (which is not

the case now). Global trade growth has slowed. India cannot rely on external demand.

Labor arbitrage doesn't work anymore. With automation, workers in developed

markets are willing to work for lower wages. There is also focus on keeping supply

closer to demand (near-shoring or re-shoring will pick up). So India cannot rely on

exports.

Inflation outlook for India.

Inflation is a repressive tax, and hurts the poor the most. There are two components of

inflation: the structural component, and the cyclical component. Rising wages of low

income people has meant food habits are changing, and that drives inflation. Longer-

term, RBI will be driven by three considerations:

Low and stable inflation is important for both internal and external investors.

As India's economy integrates with the rest of the world, inflation cannot be very

different from ROW

Interest of savers - important to keep a positive real savings rate.

Is India's BoP vulnerable?

No. In 2012 and 2013 India had 4.2% and 4.5% CAD which was much higher than the

sustainable CAD of 2.5%. But the self-adjusting characteristic of CAD did not play out

because of excess money supply globally. So, when the reversal happened, the rupee

made that adjustment very abruptly, and in a destabilising way. India became complacent,

and was taken by surprise. Now however, India is out of the Fragile Five, the CAD is lower,

reserves are higher, and India is much better prepared.

Why is fiscal consolidation so important?

In the past few years, India has seen all the classical problems of a high fiscal deficit: high

inflation, crowding out of the private sector and BoP imbalances as excess spending

spilled over into external balances. So, while for the rest of the world the debate is

"austerity vs. growth", in India the debate is "austerity FOR growth". There is a need to

give space to the private sector.

Way forward on ease of doing business.

Governance reforms are important. India ranks 142 on the ease of doing business

rankings. Governance hurdles have to be cleared at the central as well as the state

31 March 2015


government level. It is unfair to compare India to China. India is a tougher place to do

business in. However, there are things that can be done. As per the same study, if one

takes a hypothetical city called "Indiana" that adopts the best practices of all Indian states,

India could reach a rank of 69, and GDP growth could be 3 pp higher.

Changing Federalism.

One needs to look at changes at the state level. There are three changes happening:

Second generation reforms will require state involvement: issues like land, labour,

indirect taxes, are all state level issues. Almost by definition these reforms are not

amenable for big bang, and will be incremental.

Central government collects 60% of taxes and spends 40%. But now states collect

40% of taxes and spend 60%. With untied transfers to state governments going up,

they get more freedom.

Governance reforms: many projects are stalled because of some problems at the

state level.

Is the Indian growth story credible?

Yes. India has left fatalism behind. For the longest time, as the East Asian economies

were accelerating, Indians thought they were smaller, and India is too big. But once China

showed that large economies can grow, India started to think it could too. And then it

showed it could. That sense of belief is very important. The East Asian economies are

referred to as Tigers, China as a dragon, and India an elephant. An elephant keeps

lumbering away, but it can dance. And it has huge stamina - it can dance for very long! In

the past five years mistakes have been made in both fiscal and monetary policies, and

India need to learn and keep improving.

Geopolitical risks

Speaker: Anders Fogh Rasmussen, former Prime Minister of Denmark

New News: None

Tone: Optimistic

CONCLUSION: Believes in a peaceful rise of China in constructive co-operation with the

US

Rasmussen highlighted the following disruptive unknowns he is most concerned

about:

Possible Russian attack or intimidation of NATO member.

Risk that ISIS advances and controls Iraq/Syria/Libya and the infrastructure there

Closure of Suez canal and terrorism in Sinai/Yemen

Closure of Hormuz strait by Iran

Iranian nuclear weapon proliferation, leading to arms race in Middle East

North Korea missile attack against South Korea, Japan or the US.

Closure of Malacca strait.

China & US Relationship:

China is focused on continued growth generation

In their interest to keep trade channels open and a free trade system in place

Realises the world's strongest power, US, will remain the same for the next few decades.

31 March 2015


The US has certain advantages that can't be overcome easily or quickly: favourable

demographics, energy surplus, R&D, education, geographical positioning and military

capacity.

China should be included in future transpacific partnerships.

By helping each other, they increase the capacity of the world to keep the unknowns

above at bay.

Health check on global economy

Speakers: Jose Manuel Barroso: former President of European Commission,

Former President of Portugal. Richard W Fisher: Member US

Federal Open Market Committee. Michael Pettis: Professor

Guanghua School of Management - Peking University. Hideo

Hayakawa: Senior Executive Fellow: Economic Research Centre. Dr

Duvvuri Subbarao: Visiting Fellow, National University of Singapore.

New News: None

Tone: Cautious on China, Positive on EU and India

China - Growth will be much lower than we expect (Michael Pettis)

What China has done is nothing new...dozens of other countries have had "investment"

miracles and all of them have had to go through brutal adjustments.

Not that a lot of that has happened. There is a reasonable chance that China may be able

to adjust through this...and that is a very, very rare occurrence.

A great case scenario is that China can grow 3-4%, with 5-7% household income

growth...and this is not bearish, if they can pull it off that will be fantastic.

The only way you get out of a high level of debt historically is through debt forgiveness

programs...reforms don't work!!!

India - Will India do what is required? (Dr Duvvuri Subbarao)

On a number of issues, India is in a sweet spot

Indian economic cycle is the reverse of some other major economies in the world

First time in 30 years a government that is assured five years in office, and federal

government controls states with 50% of GDP.

But India is supply constrained. Especially, infrastructure. Need USD1tr in next 10 years.

That is 10% of GDP every year.

EU and reforms:

Reforms are slow but indeed happening. Retirement reform, employment reform.

This is going to be a good year for Europe (President Barroso)

Rise of extremism and what is happening in Russia is a risk, but will probably be handled.

US - where from here:

There is still no consensus on when to tighten inside the Fed.

This is the lowest rates in the US in the past 260 years history of the US.

Low oil puts pressure on the job market, especially in the Texas and the oil industry which

was the biggest contributor to job creation.

31 March 2015


There will be a natural reduction to raise rates as the lessons of 1937 are still worrying

policy makers. Then too we thought we were coming out of a recession and walked into

the depression.

So we are moving from Uber accommodative to just "accommodative".

Hong Kong: A Bright Future

Speaker: CY Leung

New News: None

Tone: Bullish

Hong Kong's past and future:

Displacement by Singapore and Shanghai not realised

Initial questions on two currencies and two systems: now realise China is big enough to

require Shanghai and HK

HK investments into mainland now cover all sectors and geographies, e.g., 70% of fees

earned by HK architects are from CN

Kowloon East and east Lantau now being developed into further business districts.

HK banks handle 70% of Foreign RMB payments.

Challenges:

Method of electing CEO by universal suffrage has to be passed by two thirds majority.

Wide range of GDP growth projections next year reflects volatility

Housing and land requirements

Filibustering by legislative members.

Tax and expenditure:

Service tax receipts should be at a record high soon

Old age living allowance has helped over 400k OAPs

Infrastructure development grown from $50 bn five years ago to $70 bn now.

Unemployment last year down to 3.2%, with minimum average earnings of lower taxile

group up 35% since minimum wage introductions four years ago.

Indonesian Challenges

Speaker: Dr B. Brodjonegoro, Minister of Finance Republic of Indonesia

New News: None

Tone: Positive

Managing the budget:

Loss of Rp1.3 tn due to lower oil price.

Tax ratio is a very low 11% of GDP, so we have to right away go about increasing this

Shows inability of collection rather than the capacity of the economy to pay taxes,

hopefully to 12%

Spending:

Last year only 95% of target spending, and Infrastructure only 80%.

31 March 2015


Some of the delays were regulation-related, some land acquisition-related. Trying to

resolve these problems now.

Budget deficit target at 2%.

Currency:

Impact on the budget for infrastructure?

Import equipment, steel, but commodities down as well so take off some of the impact

Helps the manufacturing sector, which is up 7% in exports last year

13,000 is a bit of a psychological level beyond which the people get worried

Balancing growth vs Currency: Growth focus from infra and SOE projects spending and

FDI.

CA deficit <3%

Increasing credit growth from 12% to 15%-17%.

Infrastructure:

Budget will cover the basic type of infra, like roads, irrigation, sanitation etc. Then will be

the fully private/SoE that will be run by companies either SOE or private companies.

Then there are the PPP projects. This is still in the early stage but already some projects

like mine-mouth IPPs, airport railway etc are going on in this area.

Rp5,000 tn over the next five years. 20% from Budget, 20% from SOEs, 20% from Private

and rest from PPP. For 2015 from the budget will be Rp300 tn, SOE Rp100 tn, PPP <

Rp100 tn.

Funding: Trying to readjust bilateral and multi-lateral loans to increase the duration of the

loans. Setting up Indonesia Infrastructure bank. Need to utilise funds from Social Security,

Hajj Fund, Endowment Education funds, etc. This bank can issue bonds and this "idle"

money can be invested in these bonds.

Are we becoming more interventionist:

Cigarettes still below Thailand (80-90%). In Indonesia, by law, it can only be 57% so we

will continue to be lower than the rest of the world.

Focus will be on bigger manufacturers rather than smaller ones.

Cement: Prices are probably higher than a free market would allow, so the government is

nudging companies towards a market-based price.

Banking Industry: No plans to intervene on banking and loan pricing, but need to improve

efficiencies in the banking sector that can bring pricing down.

Indonesia Central Bank

Speaker: M.Aditsyaswara, Senior Deputy Governor of Indonesia Central Bank

New News: None

Tone: Positive

The focus of BI remains to be

Inflation (target 15-17: 4%, plus and minus 1%, 18 onwards at 3.5%)

CAD should not go above 3% GDP, already include the acceleration of govt infrastructure

spending (estimating above US$1 bn)

31 March 2015


External debt, the reason of introduction of hedging last Dec 14 of 20-30% that is maturing

3-6 months period

The use of Rupiah in the domestic market transaction

LDR for banks already high at above 90%, encouraging banks to issue non-deposit

instruments

Payment system

Interest rate cut in Feb 15 because of the lower inflation, NOT because of the easing

monetary policy.

Depreciation of Rupiah is a bit too much already at this level. BI also concern because it

will impact the inflation. Stress test that up to Rp14,000 on the exchange rate, to the banks

and external debt are still fine. Survey on the corporates that did not hedge onshore, did

offshore hedge.

CAD for the next few years will still be 2.9-3%, but the structure is different now, it is more

for infrastructure rather than for consumption (fuel subsidy).

Debt service ratio is at 40-45%, partly because of Pertamina's short-term borrowing

resulting from the previous subsidy mechanism is waiting for the funds from the

government. However, with minimal subsidy now, the short-term borrowing of Pertamina is

going to be minimal as well.

Slowdown in economy because of commodity, particularly in Sumatra and Kalimantan.

Java houses the manufacturing and service industry, still growing at 5.5-6% (Jakarta at

6%, East Java 5.9%, West Java 5.6%, Sumatra 4.5-5%, Kalimantan 4-4.5%, Bali 6.5%)

Real effective exchange rate is being looked at as well, but not necessarily has to follow if

the other countries' exchange rate depreciates

In order to speed up the licenses for foreign investment in Indonesia, the Government has

given the authority to BKPM (Indonesia Coordinating Investment Board) instead of having

to go to different ministries

The government has announced a package to reduce the CAD: (1) insurance company,

(2) investment of profits, tax incentives given to corporates (need MoF decree), around

US$19 bn, (3) fee visa to 30 countries (target 25 mn tourists vs current 8-9 mn), (4) tax

incentives for corporates with 30% export.

NPL for the banking sector is about 2.3% currently, from 1.7% in 2012

Loan growth expected at 14-15%, including the govt infrastructure, currently at 11-12%.

New governance in China – maintaining the rule of

law

Speaker: Professor Liu Mingkang, Distinguished Fellow, Fung Global Institute

New News: None

Tone: Positive

Increase judicial system efficiency. China will allow lawyers previously working in

private sectors to play a role in the legislative system, thereby bringing in their expertise to

increase justice, transparency, and predictability of China's judicial system.

Local government debt replacement. In Prof Liu's view, whether the government's

switch from LGFV to a provincial government bond can reduce financial systemic risk

depends on how the government performs with the new borrowing tools. However, two

things are made clear: first, local government liabilities will be reduced; and second, bank

loans related to local government activities will decrease also.

31 March 2015


Rmb internationalisation. Capital account free cash flow is the destination of Rmb

internationalisation, but time is needed to gradually carry out the reform, as highlighted by

Prof. Liu. Although Shanghai–HK connect provided only a thin channel between China and

Hong Kong capital market, it is actually playing very important roles and will be used to

check whether China is on the right direction.

Other reforms. According to Prof. Liu, the government under Xi's leadership shows their

determination to implement reforms in other areas such as strengthening intellectual

property protection, increasing accounting system transparency, resolving pollution

problems, among others.

The new energy reality

Speaker: Dr. Fereidun Fesharaki, Dr Pierre Noël, Professor Ni Lexiong

New News: None

Tone: Neutral

Oil price expectations of around US$50 for 3Q, and US$55 for 4Q for most panellists.

What could change the current status quo?

OPEC and particularly Saudi want to see a SLOWDOWN in the US growth of production...

c. down to 100k-200k growth a year.

The market cannot expect them to act in the June meeting as nothing has happened in

that regard.

Higher oil prices will likely therefore only occur if Saudis can cut production substantially.

Shale effects?:

"YOU CAN NOT KILL THE EFFECTS OF SHALE OIL, ONLY POSTPONE IT"

Investors should expect these effects to last 10-15 years, as a best guess.

Naturally, these lower prices damage high cape projects.

Japan:

Still struggling with the restart of nuclear energy.

This is crucial to the 'three E's' : Energy Security, Environmental Effects, Economic

Efficiency.

China:

Strategic reserves of only 90 days. May use low prices as an opportunity to accumulate.

Energy demand is huge, of course. In the short term, they may stockpile or acquire foreign

fields and companies. In the long term, they need to focus on solar, hydro, nuclear and

wind.

Shale is in a mixed position in China. The technology is rapidly advancing but the

problems of a lack of water in the North, and population density in the south, persist.

Shale projects are being resisted economically and socially.

The War on Graft

Speaker: Professor Chang Li, Mr Michael Pettis

New News: None

Tone: N/A

31 March 2015


Below, we give an extract of the main points discussed during the keynote panel titled The

war on graft: What impact will it have on China's political and economic future?

Current situation:

Over a hundred minister-level politicians have now been arrested, making it the most

aggressive campaign to date.

Campaigns usually last 1 to 2 years, with the situation usually degrading further as soon

as it ends. This could be different.

We could expect this campaign to last until Feb '17.

China at a crossroads right now, more so than in the last 26 years... "A PARADOX OF

HOPE & FEAR"

- The HOPE is that after 2 or 3 years, we are over the peak of corruption.

- The FEAR is that this alienates people. Who or what is next?

Support for the anti-corruption measures:

Many still unsure whether this is just a facade for an internal power struggle and a party

purge.

The general population, military and low level public service employees are lending

support to this.

Party officials, military brass and liberal intellectuals are not.

Will this campaign aid reforms in China?:

Corruption is NOT incompatible with growth.

US had the same problems post the civil war, but on an even LARGER scale.

'Destabilising' corruption, which occurs in times of political instability (where corruption

gains are maximised in the short term), is something which we should worry about

however.

Liberalising reforms deny the elite the ability to extract rent, and have as such been

vehemently opposed in China.

Premier Xi has to implement these reforms, regardless of pushback, similar to the 1980s.

The pace, procedure and implementation of these reforms have been questioned. Not the

morality.

We should expect the Chinese government to steamroll these changes through. The

openness to reform that a free and independent judiciary affords will not be the case here.

Anti-corruption will be joined by a growth in discipline, stronger oversight bodies, etc, in the

coming years.

When will frontier markets prove rewarding to

investors?

Speaker: HE Sun Chanthol, Dr. Syed Samad, B. Bazargur, Serge Pun

New News: None

Tone: Mixed

Bangladesh:

FDI guaranteed by protected legislature

Democracy and accountability of government

Second easiest place in region to do business and start business according to World Bank

31 March 2015


Sector wise: Agribusiness, plastics, readymade garments, shipbuilding, furniture

Business financing largely direct, no real corporate bond market.

Private equity dominated by private investors

Large scale reform in process

Cambodia:

In the last 20 years, Cambodia has grown by 7% per annum: sixth fastest in the world.

1.2% inflation. Debt to GDP only 30%.

Political stability, pro business government

Investment law provides tax incentives, no capital controls + duty exemptions

EBA (everything but arms) means everything made in Cambodia can be shipped to

Europe without duties.

Myanmar:

Labour law came before economic reform

Political and social reforms are far reaching, but not immediate perhaps.

Inclusiveness, responsible business required.

Will HK remain a compelling investment destination?

Speaker: Regina lp Lau Suk Yee, Steve Vickers

New News: None

Tone: Bullish

Hong Kong Current Status:

Beijing's decision last summer has led to Youth pushback and anti-mainland sentiment.

One party Two Systems requires many factors to work efficiently.

Basic law draft in 1980s was to protect HK's liberal lifestyle and freedoms from

encroachment by socialist China.

Did not envision world today, with HK's position in the world today having changed so

substantially

Globalisation, China becoming a powerhouse, and HK's own economic changes, have all

played a part.

HK has failed to ride the digital wave:

Only accounts for 2.9% of China's economy.

Without a clear strategy, HK has stood still relying on classic system of no-interference.

Shenzhen has grown into a technological hub, whereas HK has not.

Challenges:

New role in China's evolving economic strategy. HK's own democratisation process. Over-

reliance on property and low-margin tourism driving growth. Bureaucratic civil service

Strengths:

Main channel for internationalisation of RMB. Business services and high value add

services such as logistics. R&D (especially education). China's most trusted partner.

31 March 2015


Company Presentations

31 March 2015


AirAsia X (AIRX.KL)

Speaker: Benyamin Ismail (CEO), Huei Shian Check, CFO

New News: None

Tone: Neutral

MH turnaround - focus on growing parts of the business that don't compete with Malaysia

Airlines (MH) such as Thai AAX and Indonesia AAX. Confident that new MH CEO

(Christophe Mueller) will execute the same "right-sizing" strategy as he did at Aer Lingus

and he is starting earlier than planned (now May). Will still face the issues of downsizing

pay-roll, which process seems to keep on being extended.

AirAsia X (D7) turnaround - systems had deteriorated since IPO and require a significant

overhaul, need to harmonise network better with short-haul, improve marketing. Looking to

lift yields, not give too much away to agents, regain ground lost to poor sentiment following

the AirAsia Indonesia crash. Also cutting headcount and renegotiating airport and supplier

agreements in return for extended contract tenor. Cutting routes will also save money:

ADL cost RM100 mn a year, double-daily MEL-SYD was RM50 mn a year and NGO was

RM70 mn a year in losses in 2014, so reducing exposure here alone would cut losses

incurred in 2014

Macro-drivers - 54% hedged at US$88/bbl, costs 60% USD-denominated. Leasing

income just temporary. Working on an ACMI basis (aircraft, crew, maintenance, insurance)

with three aircraft right now and another two later in the year. Generally on two-to-six-

month terms, but want to reduce exposure to this to only two planes in 2016.

Cash flow - need the rights issue to generate adequate cash flow to change balance

sheet shape and service creditors aside from bank loans. RM400 mn rights issue should

allow the company to restructure balance sheet within six months. Haven't been able to

market adequately as budget has been cut to conserve cash. Need to generate more

sales so focusing on launching Sapporo ahead of Golden Week, looking at Hawaii,

Auckland and London, but will need an A330-HGW that has the "legs" to get there.

Ajisen (0538.HK)

Speaker: Robert Lau (CFO), Richard Liu (Vice President)

New News: Yes

Tone: 1Q15 negative, overall positive

1Q15 update: China is challenging, Hong Kong is better because of poor traffic in malls.

Strategy focus: (1) smaller stores – 30-40% higher sales per sqm; 1% higher OP margin;

15% save of capex; (2) delivery –15 stores in Beijing on trial; third-party delivery partners

include Meituan, Eleme, Daojia, and Baidu Waimai; now only accounts for 6% per-store

sales; target is to reach 10%; incremental net profits margin from delivery is 30-40%; (3)

store in malls – Ajisen will still have >90% stores in malls because management expects

malls would draw better traffic when increasing F&B area.

Management is committed to improving efficiency and business diversity. However, less

focus on product and service quality, which is the reason for Ajisen's losing customer

traffic.

Timothy Ross

+ 65 6212 3337

timothy.ross@credit-

suisse.com

Sophie Chiu

+852 2101 7657

sophie.chiu@credit-

suisse.com

31 March 2015


ASM Pacific (0522.HK)

Speaker: Leonard Lee, Strategy and Corporate Communications Manager

New News: None

Tone: Positive

Similar broader end market drivers for the business. In 2014, top drivers were

automotive orders, industrial, and strong orders for a high-end smartphone (normally

orders for a two-year cycle so may slow in 2015) and emerging market smartphone. For

2015, the company is looking at a similar set of growth drivers as auto/industrial has long

product cycles and mobile investment continues.

Sales and share gains targeted to continue in SMT. The company believes the SMT

market will grow from US$3.5 bn to $3.8 bn and targets modest share gains. ASM Pacific

has crossed 20%, up from an 11% share when it entered the business, with $600-700 mn

annual sales. It expects to pass Panasonic’s 24% share by 2016. The company has #1

share in Europe, #2 in the US and #3 in China/#4 in SE Asia, so targets more share in

mobile/IT and emerging markets. This year, the company is launching a mid-speed SMT

tool (Eby SiPlace) targeting the mainstream market at lower cost to gain share and has

gained in the US/Mexico small manufacturers. The company is also launching an

integrated close loop for yield improvement/cost savings for customer with screen printer

acquired from DEK (applying solder paste to PCB), solder paste inspection (being

developed by the back-end) followed by SMT pick and place. The TAM of SMT is US$3-

4bn (screen printer added US$500mn with DEK at about US$40-50mn run rate).

Back-end has tougher compares after a strong 2014. The back-end market is about

US$4-5 bn although the company cites Gartner data forecasting flat in 2015 and -10% in

2016 although its own market feedback is for some YoY improvement in 1H15, but 2H15

YoY faces tougher compares. Last year saw strong lift from smartphones,

automotive/industrial, LED and moderate expansion in CMOS sensors.

Advanced packaging growing. The company now has 60% from traditional die and

wirebonders and 40% from advanced packaging (TCB bonders, flip chip bonders, and

encapsulation, molding, test handlers, clip bonders for power management and CMOS

sensors). Advanced packaging has grown from 20% to 40% since 2011, with newer

products having better margins. The company has TCB bonder for CPU and is working on

a faster solution for mobile (3-4bn unit module addressable market), as pricing /

throughput is less competitive with flip chip bonders. In flip chip bonders, the company is

#2 and doing well in low pin count for RF with a die bonder with flip chip capability.

Margin impact. ASM is guiding a few points GM increase in SMT to high 30% for the full

2015 by insourcing more production in Asia to counteract ASP pressure from the Yen. It

has shifted feeders to Malaysia to lower costs and some modules to China. The back-end

target GM is 40%, targeting outsourcing at 30% of its production. It targets opex at 20% of

sales.

Currency impact favorable. The company believes currency is favourable netting

everything out. While the Yen puts strong pricing pressure on SMT, it has less on back-

end as Towa/Shinkawa are smaller players there and ASM Pacific is gaining share with

insourcing and new lower cost tool. The company has a good portion of costs in Germany

in SMT so Euro is favourable.

ASMI selling pressure is now lower. ASMI reduced holdings from 52% to 40% of ASM

Pacific two years ago to unlock some value. ASMI has now done much better and lifted its

own share price, so the company believes pressure for ASMI to divest shares of ASM

Pacific is lower.

Randy Abrams

+ 886 2 2715 6366

randy.abrams@credit-

suisse.com

31 March 2015


Astra (ASII.JK)

Speaker: Iwan Hadiantoro - Chief of group treasury, Tira Ardianti - Head of IR

New News: None

Tone: Neutral

Last year, domestic 4W auto sales volume were 1.2mn; fell slightly YoY.

Jan/Feb sales were weak due to (1) flood affecting logistics, (2) adjustments to inventory

and (3) the introduction of new models by competitors.

Starting two years ago, auto players in the market began increasing production capacity;

currently around 2 mn units, but domestic demand is only 1.2 mn units and exports 200k

units, which leads to high discounts in the market.

Mitsubishi intends to build a plant in Indonesia with production capacity of 160,000 units.

Management thinks that this is temporary, not structural.

Current average discount for Astra's cars is 6-8%; management expects similar level for

the next 12M.

Can improve market share via new launchings? Astra has several products in pipeline but

the timing of its launching remains undisclosed.

Management intends to do major facelifts for low MPV models (exterior and engine) for

this year.

Complete model change for Toyota Innova and Fortuner for this year.

With Astra's comfortable market share level at least 50%, the company is optimistic that

with strong value chain and after sales services, supporting financing and insurance

businesses, market share can be maintained.

In the heavy machinery division, clients delay replacements and extend lifecycle.

Management expects replacements to occur this year as the average life cycle is around 7

years, which is the max before productivity declines.

Management is comfortable with overall revenue mix of 55% autos and 45% non-autos.

Dollar debt is fully-hedged with currency swap.

AUO (2409.TW)

Speaker: Pearl Lin, Senior IR Manager

New News: None

Tone: Cautiously optimistic

1Q15 tracking in-line with guidance. AUO guided 1Q15 large size panel shipment to

decline high-single digit to low-teens QoQ and maintains its unchanged guidance

(Jan+Feb large size shipment is 67% of mid-point of guidance). Loading rate is expected

to stay at low-90% level due to annual maintenance for some fabs. It noted the sequential

decline for TV shipments in 1Q is mainly due to annual maintenance, while the IT

shipment decline is due to weaker end demand.

TV inventory level healthy for most regions, IT inventory still slightly higher. AUO

thinks TV inventory level post CNY returned to a healthy level of six to eight weeks, but

inventory level in Eastern Europe is one to two weeks higher due to weaker currency. For

IT (NB, monitor), it thinks inventory is one week higher than normal and believes the

supply chain will still need to work down the inventory after strong 2H14 shipment.

2Q15 outlook depends on sell through. AUO noted TV panel demand for 2Q will

depend on China May holiday sell through, especially there is no major sports event this

Jahanzeb Naseer

+62 21 255 37977

jahanzeb.naseer@credit-

suisse.com

Bernard Kie

+ 62 21 255 37902

bernard.kie@credit-

suisse.com

Jerry Su

+886 2 2715 6361

[email protected]

31 March 2015


year (last year had World Cup), and it hopes leading TV brands to start pull-in by end-2Q

to prepare 2H demand. For NB panels, it sees pent-up demand in 1H prior to Win 10

launch. NB makers might need to modify their design to meet the new MSFT

requirement/subsidy. Overall, it thinks 2Q demand will be weaker than last year's, due to

no sports event, but still in-line with normal seasonality.

New products/technologies to differentiate. AUO has been developing new

technologies for TV panels, such as 4K, curved TV, HDR (high dynamic range), Quantum

Dot, etc., in order to differentiate itself with Chinese peers. It expects 2015 4K TV sell-

through of 23-24 mn units (10% penetration), vs 9 mn last year (4% penetration), and

believes panel demand will be higher than this. It is also working on NB OTP (on-cell

touch) and in-cell smartphone panels for 2Q (OTP NB) and 2H (in-cell) mass production.

Balancing customer portfolio. AUO aims to further balance its customer portfolio to

offset demand slowdown, if any. Currently, China TV customers account for one-third of its

TV business, one-third for Korean brands, and one-third for others (US/European brands,

ODMs). Also, its smartphone is more exposed to mid-to-high end (HD720/FHD) with

Chinese customers accounting for 50% of smartphone business.

Ayala Land, Inc (ALI.PS)

Speaker: Jaime Ysmael (CFO), Ricky Celis (President - Amaia)

New News: None

Tone: Positive

Achieved 5-10-15 plan: Initially targeted to reach P10 bn NIAT and 15% ROE in five

years from 2009, they were able to reach NIAT target one year ahead in 2013 with FY14

NIAT reaching P14.8 bn. Nevertheless, ROE only reached 14.4% by FY14 because of

capital raising activities, i.e., FTI acquisition and opportunistic land banking in 2012 and

2013. Recently, had a private placement in January 2015; the company doesn't see any

additional equity raising this year, FY16 funding will be reviewed given internal net debt

threshold of 1.0x (currently 0.74x).

Sets new "2020-40 Vision" plan: The company has guided for a NIAT of P40 bn by 2020,

or 20% annual growth from its 2013 level. It is well positioned to take advantage of the

property cycles given expansive land bank of 8,639 hectares (gross) across 31 growth

centers in the Philippines (90/10 land bank split Metro Manila/Provincial). Focus is on

developing new large scale/mixed-use/integrated property estates, which has been a

successful model for them in Makati CBD, Bonifacio Global City, Cebu Park District, and

Nuvali. They look to triple their Office and Malls GLA and Hotel rooms by 2020 - bring

residential revenue contribution to 50% of total revenues (currently at 2/3).

2015 guidance: FY15 capex budget of P100 bn from P83 bn last year - 37% residential,

31% land banking, 15% malls, 5% offices, 3% hotels and resorts, 9% general use. Mixed

tone on residential project launches, they reduced it to P87 bn worth of residential sales in

FY14 from P108 bn in FY13 due to supply glut concerns, but look to offer P100-120 bn of

new residential projects this year. Demand for office and malls leasing is stable, and they

will continue to grow office GLA primarily because of BPO demand.

Comments on regulatory risks and recent market developments: Management is well

aware of stringent regulatory measures, in fact they are in constant discussion with the

central bank to discuss the situation of the property market. They believe that there is no

price bubble given that the property developers behaved rationally in their yearly ASP

adjustments; they also think the high land bidding in Bonifacio back in Oct'14 was a one-

off. Supply-demand imbalance in Metro Manila because of aggressive launching of small-

cut low-end residential units. Banks will continue to lend given high liquidity and property

developers will continue to moderately grow their residential business given an

addressable housing demand especially in the low-end segment.

Danielo Picache

+ 63 2 858 7758

danielo.picache@credit-

suisse.com

31 March 2015


Baidu (BIDU.OQ)

Speaker: Sharon Ng, IRD

New News: None

Tone: Positive

Mobile monetisation is behind PC, but trending up supported by more data points from

users on mobile. Click-to-call/click-to-action on mobile shows clear conversion to

advertisers. In 4Q14, mobile revenue accounted for 42% of the total revenue.

LBS is a broad strategy for Baidu. The company will increase spending on the O2O

initiatives in 2015. Baidu Connect had aggregated 600K customer accounts spanning 13

verticals. Number of O2O transactions completed on Baidu has grown 4x YoY. 15% of

movie tickets were sold through Baidu on Girls Day. Baidu is planning to tap into the take

rate model and form a closed transaction loop by leveraging the large traffic on the

platform.

On the cost side, 1Q will be at an elevated level (does not mean peak spending of the

year), with different festivals. PC is still the major part of TAC, such as contextual ad,

which as a percentage of total revenue went up in the past few quarters. TAC as a

percentage of revenue will step up with pace similar to last year. Content cost will be more

than doubled this year mainly from iQiyi. Sales and marketing will also increase due to the

spending on new O2O initiatives.

Bank Central Asia (BBCA.JK)

Speaker: BCA management: Eugene Galbraith, Dy.CEO

New News: None

Tone: Neutral to cautious

Economic Outlook: Not much fiscal stimulus this year but it should pick up next year.

Infrastructure spending unlikely to start this year either. IDR currency depreciation adds to

the nervousness among people.

Even though the overall banking market may not grow as much as it used to, the

interesting action will be at the firm level - winners and losers. Foreign-owned mid-tier

banks having trouble at home (STAN, HSBC, CIMB, etc), so larger banks have

opportunities to pick up market share. Also a couple of state-owned banks have new

management, hence some disruption possible.

Infra Spending: Government is targeting a 40% increase in tax revenues, never seen so

much focus, but money not really available yet. Corporates are spooked, our loans are

below Dec year-end level and unlikely to come up until April.

FDI: For Japanese businesses, Indonesia is strategic and they are active. Koreans have

plans but they have a problem with the labour laws.

Luxury Tax: Not good for the mortgage market, but ok for us. Our origination average is

US$100k and LTV is 65-67%. We launched a new product on Chinese New Year at fixed

8.88% and capped at 9.99%, applications went up 25% in past six weeks. So mortgage

balances should rise, and our market share of 18% may rise.

SME: Our mid-market is not affected by lack of infra lending. Our budget is to grow mid-

market book by 18%, looks ambitious.

Loan Growth: In 2012 we did Rp52 tn in net new lending, 2013 Rp56 tn, 2014 budget was

Rp40 tn, we did only Rp35 tn. 2015 out budget is 45 tn. Highest delta is mid market at

18%, it is going be difficult. Corporate lending target is 15-16%, but so far pipeline is dry.

Mortgage should grow around 5-6% on budget, we turn away more than half of the

applications. We're announcing four wheeler packages, should start growing.

Dick Wei

+ 852 2101 7339

[email protected]

Sanjay Jain

+ 65 6306 0668

sanjay.jain@credit-

suisse.com

31 March 2015


Net Interest Margins: No pressure on liquidity as of now. We have cut time dep rate by 25

bp and we are on 7.25% TD mostly. Roughly 25% of our funds are TD, around 75% are

Rp2 bn or less. On lending side, we have cut PLR by 25 bp but eliminated branch

manager's discretion of 25 bp. Also we have cut saving dep rate by 10 bp, so overall

margins should be ok. But can only cut so much - BCA is the bank that loses the most in

falling interest rate environment.

Deposits: Dep/GDP is around 35%, lowest in Asia. C/A deficit is 3% of GDP and solution

lies there. Our LDR target remains 80% (vs 76% actual), we should move to LCR.

Consolidation: Regulators want to go from 118 to 80 bank licences, want BCA to acquire

hence we've budgeted for one. But we want to fire people, not allowed.

Asset Quality: Has not deteriorated. We are not immune to commodity pressures, our

credit risk guy had expected NPLs to rise to 80 bp. What worries us is dollar borrowings,

many of which are undisclosed. The system as a whole also had a good 2014 but there

should be some cracks there.

BASF (BASFn.DE)

Speaker: Magdalena Moll, Head of IR, Amber Usman, Director IR Asia

New News: Yes

Tone: Neutral

2014 review (chemical segment): Performance was slightly lower in 2014 as compared

to previous years. North America had witnessed good cracker margins and cracker

maximisation, Europe had seen stability and Asia was slightly down due to pricing

pressures on caprolactam and isocyanates amid new capacity additions in the region.

2015 outlook: 2015 had seen a good start already with double-digit volume growth from

the agribusiness. Management is cautiously optimistic for BASF’s 2015 outlook, expecting

positive and healthy momentum to continue for US and stable growth from Europe. EBIT

level for all segments will be keeping at similar levels as last year, except for slight

decrease within oil & gas segment (higher volume to offset the drop in oil price) and

chemical segment (due to considerable start-up costs and additional depreciation charges

from the new plants). Management also guided to better cash flow in 2015 due to lower

capex and lower inventory build-up.

Long-term strategy: Management is committed to focus more on the downstream

segment (where they can charge higher margins from customers due to innovations and

tailor-made services) in the long run, and moving away from the cyclical upstream

segments (petrochemicals, i.e., only for supporting the downstream development).

Capex plan: According to management, near-term capex (~US$4 bn in 2015) will be

focused mainly on upstream projects in emerging markets, e.g., MDI plant in Chongqing.

Notable projects in North America include: (1) Refurbishment of existing crackers to use

ethane, propane and butane as feedstock (currently relying on naphtha only); (2) Minority

stake in an ammonia plant (750,000 MT/year) and (3) MMTP plant (still under feasibility

studies) to convert methane into propylene (20% cost advantage).

Kenneth Whee

+852 2101 73196

kenneth.whee@credit-

suisse.com

31 March 2015


Bharti Infratel (BHRI.BO)

Speaker: Mr Devender Singh Rawat, CEO

New News: None

Tone: Positive

Expect tenancy to continue to rise as data consumption volumes grow and smaller

operators play catch up on coverage. RJio could be another catalyst for accelerated data

networks rollout

Have initiated talks with regulators in Sri Lanka and Bangladesh for the purchase of tower

assets of Bharti Airtel, but these will be small in size. Overall, management is committed to

increasing leverage levels

Competition in tower industry remains stable and pricing is intact. Capex requirement is

low in the near term due to sufficient capacity installed

The company is exploring opportunities in fibre sharing in future, as well as in building

coverage/ wifi hotspots

BLOOM (BLOOM.PS)

Speaker: Leo Venezuela, Director for Investor Relations

New News: No

Tone: Positive

Operating trend remains robust, specifically in the VIP segment. Bloomberry achieved its

highest quarterly VIP turnover in 4Q14 at P162 bn (HK$2 bn). Management expects this

trend to continue as more junkets sign up. In fact, Sun City, Macau's biggest junket, is

already in the hiring process and will likely begin operations in Solaire as early as April.

The VIP segment, which accounts for 50% of total GGR, is composed of 75% junket VIP

and 25% direct VIP. Management estimates that mainland China, HK/Macau, Korea and

other SEA account for 50%, 10%, 20%, 20% of foreign VIP revenues, respectively.

Solaire has acquired three Korean properties: (1) 12.2 hectares in Muui, (2) the 20.96-

hectare Silmi Island and (3) up to 92% stake in G&L, which operates T.H.E. Hotel and

Vegas Casino in Jeju. These Korean acquisitions have raised concerns regarding funding.

According to management, they are not raising capital for these acquisitions. It is worth

noting that the company has already raised US$125 mn in November 2014 and the US$50

mn in escrow as a requirement of the provisional license will now be released.

Only the VIP junket tables were opened in November 2014 but Phase 1A will also include

an array of non-gaming facilities. A karaoke bar will be opening within the next two weeks.

The 10,000-sqm retail area is expected to open in 2H15. The expansion will also include a

1,400-sqm night club and a 2,800-sqm spa/gym/salon. Lastly, the 6.2 hectares of land

beside the current property will be developed as Phase 2.

Blue Bird (BIRD.JK)

Speaker: Andre Djokosetono (Director), Robert Reimmsei (CFO)

New News: Margins expanding on lower fuel and higher tariff, sharing part of the

margin increase with drivers for better retention, new licenses likely by

the end of this year

Tone: Positive

Fleet size update – 26K BB taxis, 80% in Jakarta. Roughly 50% market share in Jakarta.

Sunil Tirumalai

+ 91 22 6777 3714

sunil.tirumalai@credit-

suisse.com

Patricia Palanca

+63 2 858 7752

patricia.palanca@credit-

suisse.com

Jahanzeb Naseer

+62 21 255 37977


suisse.com

31 March 2015


Licenses – 6,200 new licenses still unused. Expected another auction later this year,

which should put to rest worries of future expansion plans.

Drivers – Recruitment is going on aggressively but quality drivers is a challenge. Accept

only 43% of the candidates that apply and about 50% of them are let go in six months

Online booking – There is rising preference, 8,500 bookings per day, 600k downloads.

25% of total bookings. Nearly 45K bookings per day

New tariff – Using the lower band of tariff now. Does that affect the brand? The main

reason is we just had a tariff hike in 2013 so did not want a strong up to 35% increase

again. And usually BB waits a few months before moving to the higher band.

Margins – Effectively an 11% increase in average revenue per can and fuel cost increased

by 7% so have a 5% advantage but passed some of this to the drivers. About half has

been passed on to the drivers. The next tariff level is about 15% higher than the current

tariff. If Blue Bird moves to that level most of that incremental gain will be retained by the

company rather than shared with the drivers (the current tariff increase shared half-half

with drivers).

Growth – Last year saw a squeeze in margin due to the fuel price increase, and the tariff

came in with a lag. 20% expansion in fleet size in the regular taxis, and a 10% increase in

revenue per car. Focused on more second half. While BB raised the payment to the

drivers to keep them incentivized, in 2015 it expects to get 4% increase in net margin.

EBIT margin is also expected to increase 2%.

Concerns – Fuel price and rupiah depreciation. Now the oil price is no longer subsidised

so depends on both the oil price and the rupiah value as it affects the local price.

Are there plans to be an aggregator as we have seen in India? This is an option worth

thinking about, but at this point BB wants to keep the app-driven traffic to themselves.

BTS Group Holdings (BTS.SK)

Speaker: Mr. Surapong Laoha-Unya, Executive Director, Mr. Daniel Ross,

Financial Director, Ms. Sinatta Kiewkhong, Investor Relations Manager

New News: Yes

Tone: Positive

Dividend to remain healthy after FY17: BTS is committed to pay Bt3.5 bn for the FY15

(end Mar 15) and Bt8 bn for FY16 (end-Mar 16), implying a yield of around 7%. 50% of

this payment is coming from recurring income and the rest from existing cash on hand.

Management expects to see at least a healthy dividend yield level of 3.5% from FY17 and

could be higher depending on the potential new mass transit contracts.

Mass transit update: Green line south is now 50% done for construction. O&M contract is

expected to be awarded in 4Q. E&M could start in 3Q. First station could be open by 2016.

The contract awarding will be through a direct negotiation. For green line in the north,

contract awarding is expected in early 2016 with operations from 2019 onward. Light Rail

Transit (LRT) line is waiting the central government's approval. The internal process from

the city government part is done and the bidding will happen within 2015. Management

expects a direct negotiation for this route. Grey line bidding is expected in early 2016. Pink

is likely to be tendering for civil and O&M contracts in 3Q15.

Warayut (Yuth)

Luangmettakul

+ 66 2 614 6214

warayut.luangmettakul@cre

dit-suisse.com

31 March 2015


Target six lines: BTS particularly targets three green line extensions; pink, LRT and grey

given some advantage on these routes. These are an MOU on BTS's land plot for depot

construction for the LRT line; some connections and linkages with stations of existing

green line BTS are operating. BTS is expected to bid O&M (long term operations)

contracts of these routes, which could generate 40% EBITDA margin based on the

existing O&M contracts. IRR would be 11-12% and equity IRR should be higher depending

on the leverage level. Warrants and existing cash on hands will be used to finance the

investment.

Increase its media stake: Recently, BTS raised its stake in VGI to 70% last week from

previously 65%. VGI had a tough year but management has full confidence in the long

term business outlook and expects to see double digit growth next year.

Eligible for fare adjustment this year: A bit of fare adjustment is possible given the gap

between the authorised fare and the effective fare. There remains room for the increase

despite the benign inflation situation.

Asset injection to infra fund not in the near term: Some assets could be injected into

the fund but this depends upon the funding requirement from the company and it is

pressed to do that for the time being. BTS may need to do it if there's a lot of mass transit

investments in the future.

Bumi Armada (BUAB.KL)

Speaker: Kenneth Murdoch, CFO; Jonathan Duckett, SVP Corp Affairs

New News: Yes

Tone: Neutral

Despite the significant downturn in O&G, BAB is still seeing some prospects: From ten

FPSO awards last year, they expect five-to-six this year, in West Africa, Mexico and even

one in the North Sea. With plenty of work secured (3 ongoing conversions, more than

competitors), they are not pressured to win contracts at this point; more concerned about

maintaining an attractive risk/reward profile in their project bids, and avoiding

overextending themselves.

Resilience of their FPSO projects due to proximity to production (i.e., cash inflow) and

project economics. Value-add is beyond providing off-balance sheet financing and lower

cost of capital: engineering solutions, project management to complete conversions on

budget and on time.

CFO stressed their (1) conservative approach and focus on steadily improving the risk

reward profile of their individual projects via contractual protection; and (2) intention to

continue focusing on improving shareholder returns rather than planting flags - part of this

will involve reviewing capital allocation in their T&I and OSV segments. OSV segment is

very tough and commoditised but there are also niches there.

A bit more detail was given about the gas project in Europe (FSU in Malta, less than

US$100 mn capex, long-term contract).

Muzhafar Mukhtar

+ 603 2723 2084

muzhafar.mukhtar@credit-

suisse.com

31 March 2015


Cheung Kong Infrastructure (1038.HK)

Speaker: Ivan Chan, CIO, and Chris Chan, IR

New News: None

Tone: Positive

The railway leasing business (Eversholt) has recently achieved a good IRR (12.5 percent)

as the industry is highly concentrated. Eversholt has a 28% mkt share. Transaction likely

to be completed by April.

CKI can leverage up with a low gearing ratio, which is a powerful pool for project bidding.

But CKI is also keeping its credit rating in mind as credit agencies tend to look at see-

through gearing, which incorporates the associate debt, but there is no covenant that CKI

cannot go below A-.

Overall CKI remains well positioned with strong balance sheet and wide investment

groups (3 deals done in past 12 months).

Dividend is targeted to increase on an absolute basis, following a strong track record. But

this needs to be balanced with keeping cash for potential acquisitions. This is unlike Power

Assets (6 HK), which has net cash, and the ability to turn cash into growth could fall if

there are no deals in the near term.

China Animal Healthcare (0940.HK)

Speaker: Jinguo Sun, Deputy CEO/Ching Chien Toh, CFO

New News: None

Tone: Positive

Top-line guidance of CAH core business

Management gave a long-term outlook of the animal healthcare pharmaceutical industry.

According to management, the industry growth rate of animal chemical drug will slow

down to 5% YoY, while the animal vaccine segment will maintain strong growth

momentum with expected growth rate at ~15% YoY.

In terms of company’s own business, the future growth driver will be focused on direct

sales of mandatory vaccine, with estimated growth over 100% YoY on top of gross margin

as high as 90%. The in-house innovation of CAH also started to bear fruit this year. As

expected by management, a new vaccine targeting foot and mouth disease will be

approved by SFDA within this year On average, the company’s vaccine business will

deliver sales growth of 30~40% YoY.

Co-operation with Lilly add values

The company has entered into a five-year agreement with Elanco (Eli Lilly's animal

healthcare business division) to co-operate on the following items: (1) Promote registration

and market launch of Lilly’s products in China, (2) Seek technical consultancy from Lilly to

improve product standards, and thus to enhance leading position on certain products, (3)

Utilise Lilly’s distribution network to promote vaccine export business

Further acquisition on Liaoning Yikang

Post the announcement of the acquisition of a 17% equity interest in Yikang, a bird flu

vaccine manufacturer, CAH has striven to further increase its shareholding and aims to

become a controlling shareholder in the future. Management expects to increase its

interest in Yikang to ~25% within 2015 through injection of its advanced suspension

culture technology.

Dave Dai

+852 2101 7358

[email protected]

Iris Wang

+852 2101 7646

iris.wang@credit-

suisse.com

31 March 2015


China Gas Holdings (0384.HK)

Speaker: Frank Li, CEO Assistant and Kevin Zhu, CFO

New News: None

Tone: Positive

After the recent city-gate gas price cut, management believes that the next gas price cut

should come within six months, given that oil prices remain weak and the city-gate gas

pricing mechanism is linked to prices of oil products.

The gas dollar margin has been stable for the company over the past few years, currently

at Rmb0.68 per cubic meter.

The company is confident about the gas demand growth in their project cities, given ~40%

of their city projects are pre-mature (Out of its 250 city gas projects, 78 are still under

construction and 23 are in their first-year of operation). Gas price cuts should also

stimulate demand.

For vehicle gas sales, the company will continue to focus on CNG instead of LNG. They

believe CNG is a more mature and profitable market with abundant demand.

The company believes the risk of connection fee being cancelled for their projects is low in

the next few years, given the low penetration rate. The company expects to beat their new

connection target in 2015.

China Lodging (HTHT.OQ)

Speaker: Baonnie Bao, Director of Strategy; Jenny Zhang, CFO; Ida Yu, IR

New News: Yes

Tone: Negative

Accor deal: Anti-trust review is passed. Move on to next stage. Still expect to close the

deal by end FY15.

1Q15: 2M15 same-hotel RevPAR down 5%. March sees the decline shrink.

Strategy focus:

More efficient franchise model - launch of Élan brand to convert existing independent hotel

more efficiently to China Lodging's format. Elan will account for 1/7 of new stores in 2015.

Direct channel - China Lodging continue to offer better price on their own channels (APP,

website)

Mid-scale hotel - Management expects branded hotel to gain market shares from

independent hotels. Will continue to build up mid-scale products and alliance with Accor to

target this segment.

CS view:

Budget hotel is facing fierce competition and soft macro. No signals suggest immediate

recovery.

China Lodging has much higher pipeline of contract hotel (>600) compared to Homeinns

(200) and Jinjiang (230), suggesting a stronger brand value and attractiveness.

China Lodging now has 8-10% of portfolio being mid-scale, higher than Homeinns. With

successful alliance with Accor, China Lodging still has decent potential to dominate in mid-

scale segment in the long run.

Dave Dai

+852 2101 7358

[email protected]

Sophie Chiu

+852 2101 7657

sophie.chiu@credit-

suisse.com

31 March 2015


China Resources Cement (1313.HK)

Speaker: Robert Lau, CFO; Elaine Lam, IR director

New News: None

Tone: Neutral

Demand: In 2015, overall China cement demand will likely be flat versus 2014, while

demand in the southern area is expected to increase by 1-3%. The company believes the

infrastructure in GD/GX is still behind eastern China, so there must be some catch-ups.

Supply: The company estimates the effective new supply in 2015 would be 10mnt, or 3-

4%, in GD/GX region. The average utilisation of CRC is 99%, versus peers 84-88%.

Pricing: 1Q15 ASP is hk$50/t lower YoY. The company estimates the price will be flat in

2-3Q and rebound in the 4Q15. The results in 1Q15 will be lower significantly YoY in 1Q15.

But the gap will be narrowed in 2Q and 3Q, and expects higher YoY in 4Q15.

M&A: The lower acquisitions in the past years were mainly due to the internal compliance

issues of the M&A target and the limited limestone resources.

China Resources Power (0836.HK)

Speaker: X. Wang (CFO), Karl Ho (IR), Shenwen Zhang (GM of New Energy)

New News: Yes

Tone: Neutral

About the power reform (guidelines were circulated within the industry over the weekend),

guidelines include opening up the retail business. CRP sees limited impact for their

business in the long term. Compared with Big 5 power groups, CRP is located in

developed regions and the company is interested in participating in the new business with

existing track record in co-generation (power and heat).

More detailed steps should be announced in the future but could take some time to

implement.

Will focus more on renewable energy and cherry-pick coal-fired investments where there

is favourable long-term demand-supply.

CRP is aware of an on-going study of a tariff cut but looking at past, EBITDA margin has

been stable with past tariff cuts offset by weak coal prices.

CRP expects unit fuel cost to drop 1% within 2015 and the drop reflects improving coal

consumption rate.

Utilisation hours are expected to drop to 5,050 hours in 2015 (5,325 in 2014).

18 units (8.59GW) will go through thermal unit upgrade to remain competitive with less

than seven years of payback period but the power plants may get some local government

incentives.

Gary Xu

+86 21 3856 0335

[email protected]

Dave Dai

+852 2101 7358

[email protected]

31 March 2015


China Shenhua (1088.HK)

Speaker: Xiaolin Wang (Executive Director and SVP)

New News: None

Tone: Neutral

Shenhua continues to strive in a challenging operating environment, including optimising

production and sales structure, and decelerating capex. Specifically, Shenhua targets to

cut capex by 18% YoY in 2015E, and cut output by 10% YoY to 274 mn tonnes.

Shenhua is taking the lead to upgrade its coal-fired power plants to “ultra-low-emission”,

with Sox and NOx emissions at levels better than the limits of gas-fired plants. Shenhua

has implemented the upgrades to eight generators as of 1Q15, and plans to expand it to

all power assets in key coastal regions.

On new energy side, Shenhua is building knowledge through its US shale Gas projects,

while continue looking into opportunities in wind and others.

On Chinese coal industry, Shenhua commented industry profitability has deteriorated

since summer of 2014, with 90% producers now at loss versus 70% a few months back.

However, many producers are still trying to produce due to employment issue. While

consolidation is a LT trend, Shenhua will be highly selective on potential acquisitions.

Shenhua view the swing of seaborne imported coal as driven by price parity only, and

2015E Chinese coal imports likely to fall to below 200 mn tonnes, 80 mn tonnes lower YoY.

Chow Tai Fook (1929.HK)

Speaker: Hamilton Cheng, finance director; Danita On, director of IR

New News: Yes

Tone: Neutral

Jan-Feb's momentum was similar to Dec quarter, with gem-set sales growth better than

Dec quarter but gold sales weaker due to still high base of volume growth in the same

period last year. In March, the sales momentum was improving sequentially compared to

Jan-Feb, especially in China.

In Hong Kong, management realised change of mainland customer profile years ago; but

that accelerated in 2014. This caused pressure on high-end products sales, which account

for 10-11% sales in HK and 3-4% in China. Currently, it estimated 60% HK customers are

from the mainland.

The number of stores in mainland was over 2,000 now and management still holds on to

200 net opening targets within the next ten years to reach ~4,000 in mainland, especially

in lower tiered cities. The company plans to close three to four stores in 12 months in HK

to save cost. CTF opened a store in Jeju, Korea in 2014. It plans to explore the overseas

market (in franchise format), especially Korea and Southeast Asia to target Chinese

customers visiting there.

Management hopes SSSG to turn positive in 2H FY3/16 due to: (1) diminishing impact

from currency depreciation on visitation, and (2) relatively low base in 2H FY3/15 when the

political unrest and currency depreciation happened. In particular, it expects SSSG for

gem set sales in mainland to record mid-single digit growth in FY3/16 given volume pickup

and price stabilisation or even upside from product mix improvement.

Trina Chen

+852 2101 7031

trina.chen@credit-

suisse.com

Eva Wang

+852 2101 7365

eva.wang@credit-

suisse.com

31 March 2015


Management targets to control A&P expense at 1.5-1.6% of overall revenue and rental

ratio back to normal 5% from current ~6%. It will have 30 stores to be renewed in FY3/16,

and will ask for 20-30% cut from the last contract.

E-commerce accounts for less than 1% of overall revenue. The company values the online

platform as a way to enhance customer's shopping experience and build relationship with

customers, especially the young generation.

Regarding the inventory pooling system, management hopes it can help to (1) mobilise

POS better and reduce aging of products, and (2) relocate products across its sales

network more efficiently. It expects that within 2-3 years, it can build a system, e.g. an APP,

to allow the end customers to search for a specific product and get it from a warehouse

nearby.

CIMB (CIMB.KL)

Speaker: Shahnaz Jamal, CFO

New News: None

Tone: Negative

Management's key priority is to reduce the cost-to-income ratio to <55% in 2015 and

<50% by 2018 ( 59% in 2014).

Apart from Indonesia where NPL is expected to peak by 1Q2015, management is

comfortable with asset quality elsewhere.

CET 1 ratio of 10.1% now is expected to surpass 11% before 2018 and dividend payout

could be better once CET 1 >11%.

Management has set ROE target at 11% in 2015 and 15% by 2018. 2015 target does not

take into consideration one-off restructuring costs.

CTBC Holding (2891.TW)

Speaker: Rachel Kao, CFO

New News: None

Tone: Positive

Target high single digit loan growth - after grew overall loan book by 10% in 2014,

management targets to grow overall loan book by high single digit in 2015, continue to be

driven by foreign currency loan (+10-15%) though TWD loans (especially mortgage)

growth will remain subdued.

See moderate margin improvement - overall margin faced some headwinds in 2014 from

Tokyo Star in Japan and lower USD interbank rates. For 2015, management expects both

NIM and loan spread to improve moderately on the back of US rate hike in 2H15 and

higher mix of foreign currency loans.

Expect fee income momentum to sustain - wealth management and corporate fee income

continue to be very strong and despite high base from 2014, momentum remain strong

YTD in 2015.

Credit cost to stay benign - After extra provisions in late 2014, management expects net

credit cost in 2015 to be extremely low, especially with very little new NPL influx.

Higher OPEX - with full integration of Tokyo Star and higher business tax, management

expects OPEX to increase by mid-single digit this year.

Danny Goh

+60 3 2723 2083

danny.goh@credit-

suisse.com

Chung Hsu, CFA

+ 886 2 27156362

chung.hsu@credit-

suisse.com

31 March 2015


Solid capital position - group double leverage ratio of 105% is lower than most major peers

so there is still room to issue debt if necessary. Bank tier-1 ratio of 10.5% can be further

improved with the sale of headquarter (NT$10bn gains) in 2H15.

Ctrip (CTRP.OQ)

Speaker: Jane Sun, Co-president/COO, Cindy Wang, CFO

New News: None

Tone: Positive

1Q guidance mainly driven by organic growth: (1) Travel Fusion integration accounts for

~1% revenue, (2) domestic agencies integration leads to another 1% of positive revenue

impact, (3) policy of gross vs net revenue booking unchanged. Gross booking method

inventory has always been small (<1% of revenue), and hotel distributor acquisition does

not increase Ctrip’s hotel inventory level.

1Q growth helped by optimisation: The company started data mining in 2H14, and should

lead to good revenue growth in 2015, e.g., if a user has a high-spending pattern, when the

user books a regular five-star hotel room, Ctrip would aim to upsell the user to a suite

room.

Both high-end and low-end hotels are seeing strong growth. High-end hotels are not

impacted by coupons, and are seeing ADR increase with upselling. Low-end hotels remain

competitively priced.

Dawnrays Pharmaceutical (2348.HK)

Speaker: Michelle Li, IR

New News: None

Tone: Neutral

The future growth of Entecavir is backed by tenders and overseas market

Management guided high revenue growth of Entecavir (under the brand name of Leiyide),

mainly contributed by opening of more provincial markets through tender wins. The future

growth of Leiyide can be also backed by the overseas market. In the Hong Kong market,

management expected its sales to expand to Rmb40 mn in 2015.

An-series is stably growing

The “An”-series was expected to grow ~25% YoY in 2015, mainly benefitting from uniform

ex-factory price and reform of sales channels at the beginning of 2015. Anneizhen realised

FY14 sales of Rmn250 mn, however the other products in “An”-series only contributed

~Rmb50 mn. Management believed there still existed a huge market potential for other

high-end “An”-series drugs.

Decrease the loss of bulk drug under Rmb20 mn

Management highlighted that the bulk drug business was unlikely to break even, but it had

confidence to decrease the operating loss under Rmb20 mn within 2015. The slow

turnover of bulk drug was mainly due to (1) Operators needing some time to get familiar

with newly established production line and (2) the rising raw material prices.

Pipeline products are still waiting for approval

Management estimated no pipeline products to be approved by CFDA within this year. On

the other side, it is proactively seeking for good acquisition opportunities to enrich its

product mix, so as to maintain a sustainable business growth.

Dick Wei

+ 852 2101 7339

[email protected]

Iris Wang

+852 2101 7646

iris.wang@credit-

suisse.com

31 March 2015


Delta (2308.TW)

Speaker: Rodney Liu – IR Manager, Flavia Cheng – IR

New News: None

Tone: Neutral

Power supply: 35-40% of revenue, with low-teens growth in 2014. Expect this segment to

be the weakest part in 15E, off a higher base and after the cyclical upturn in game console.

High power: ~10% of revenue, with low-teens growth in 2014. Expect this segment to see

the strongest growth in 15E, driven by demand recovery and Eltek merger.

Cooling fans: ~10% of revenue with mid-single-digit growth in 2014. Expect similar

growth in 15E, driven by share gains in non-IT.

Passive component: ~10% of revenue with double-digit growth in 2014. The most

unpredictable business in 15E, due to uncertainties in major customer's product cycle,

pricing, allocation and its own diversification.

IA: ~10% of revenue with mid-single-digit growth in 2014. Expect growth to accelerate in

2015E, on share gains and expanded product portfolio, on top of stabilised China demand.

Looking for M&A opportunities here.

Networking: 14% of revenue with double-digit growth in 2014. Expect to be the second

fastest growing segment, driven by faster data traffic and data center.

Display solution. ~6% of revenue with double-digit growth in 2014. Expect growth to slow

down in 2015E, off a higher base.

PC exposure coming down, auto still modest. Delta had over 20% of sales from PCs

(fans, SPS) in 2014 but is expected to be below 20% this year, given the PC softness,

growth in other areas, and Eltek acquisition. In auto, Delta has some share in dashboard

assembly and components but still relatively small.

Robotic arms a long-term growth area – adds IoT for predictive maintenance. First

target for robotic arms is electronics assembly, with 2015 target for 1,000 units at

US$10,000 ASP with half for internal production. The company has plans to double

production with 25% internal and 75% external next year, tripling sales from low base. The

company’s robotic arm offers good payback to customers within a few years with ASPs

scaling below US$10,000 in volume. The robotic arm solutions are vertically integrated (all

components except the reduction gear) with the company designing 6-axis robotic arms

with good servo motor, driver and machine vision. The company is working on integrating

IoT technology into its solutions to allow predictive maintenance services.

Use of cash. Delta is committed to a stable cash dividend policy and is unwilling to go net

debt. Capital intensity is falling, and will be mainly for automation. R&D intensity and

branding commitment are going up.

Dr. Reddy’s (REDY.BO)

Speaker: Mr. Saumen Chakraborty, CFO

New News: None

Tone: Positive

Overall, DRL management sounded positive on growth outlook in the US and India

markets and monetisation of its innovative drug pipeline. However, DRL continues to

monitor its outstanding exposure in Venezuela.

US (45% of sales) – Mix of filings changing in favour of higher margin products. 60% of

the pending pipeline is in the low competition space.

Pauline Chen

+8862 2715 6323

pauline.chen@credit-

suisse.com

Anubhav Aggarwal

+ 91 22 6777 3808

anubhav.aggarwal@credit-

suisse.com

31 March 2015


Venezuela (5% of sales and 10% of EBITDA) – Conversion from Bolivar to USD has

dried up post Dec-14 and current outstanding exposure is $30-40mn. DRL continue to

monitor cumulative exposure and will reduce sales if potential loss on total outstanding

amount is more than COGS.

India (12% of sales) – efforts are focused towards increasing mix of chronic sales. DRL

remain open to acquisitions in the chronic space.

Russia (12% of sales) – DRL has taken price increase in few products and maintains a

positive outlook on the market. DRL is open to more acquisitions in Russia as post Rouble

depreciation, the valuation expectations have moderated.

Innovative pipeline – DRL continue to expect to file their first proprietary product shortly.

Upside from biosimilars in the US/EU is likely to be in FY18/FY19 only.

DSN (DSNG.JK)

Speaker: Mr Andrianto Oetomo (Deputy CEO), Jonathan Sax (Investor

Relation), Fonny Surya (Corporate Finance)

New News: None

Tone: Positive

DSN was established by ex Astra executives Teddy Rahmat, Benny Subianto and Winarto

Oetomo as a wood business-focused company. Over the years, DSN shifted its business

focus to palm oil, which now accounts 72% of revenue.

Young plantation profile:

DSN has 62,000 ha nucleus (company owned) area, of which 48,000 ha is mature.

Average age at end-2014 was 7.1 years (or 8.9 years of average age of nucleus mature

area). The company has 108,000 ha of unplanted landbank, enough for 8-10 years of

annual new planting plan. All oil palm area is located in Kalimantan.

Comparison to peers:

DSN FFB yield reached 26 tons/ha (vs Indonesian peers average 22 tons/ha) and

extraction rate (OER) 23-24% (against peers 21-22%). Its CPO yield reach 6.3 tons/ha,

achieved at a very young plantation age.

Cost control:

As of FY14, DSN has a unit cash cost of USD388/ton, or on the lower quartile compared

to other Indonesian peers. The company does forward hedging on fertilizer (1/3 of costs)

and signed a year ahead in Rupiah.

If CPO price continues to go down...

DSN is committed to not cut its fertiliser application (typically what other planters do) as it

will hurt yield in the next two to three years. In low CPO price situation, the company

plans to:

save on other costs, one example is by adopting mechanisation (fertiliser application

and fruits evacuation) to cut down labour costs

cut down on new planting schedule

Other than this, given its better position against peers, management views the low CPO

price period as a good opportunity for M&A.

DSN plans to conduct 8% non pre-emptive rights issue (timeline within the next two years)

to new shareholders. The additional shares are expected to improve stock liquidity going

forward.

Priscilla Tjitra

+ 62 21 255 37906

priscilla.tjitra@credit-

suisse.com

31 March 2015


EDU (EDU.N)

Speaker: Stephen Yang, Vice President of Finance

New News: None

Tone: Positive

Pop kids enrollment has seen nice recovery since last quarter, while enrollment for U-can

has remained strong. Overseas enrollment is slowing on high base and maturing study-

overseas market. However, the price hike should help fuel growth for this segment.

According to management, margins for FY15 will likely contract, as a result of the weak

top-line growth in 1H FY15 due to poor performance of its Pop kids program as well as

online investments. The company aimed to invest a total of US$35 mn in online and O2O

initiatives for the current fiscal year.

Management guided for 15-20% top-line growth in FY16, driven by re-acceleration of its

pop kids program, which will likely result in a margin expansion next fiscal year.

Gajah Tunggal (GJTL.JK)

Speaker: Catharina Widjaja (Director), Raymond Feddes (GM IR)

New News: FCF should turn positive in 2015, favourable currency impact. 40%

exports benefit from the falling rupiah. Capex is coming to an end.

Looking to hedge USD50m coupon to hedge, Total USD500m bond

principal is not hedged, but 40% of revenue also in USD (approx

US$500 mn which matches the bond size).

Tone: Cautious

Largest integrated South Asian manufacturer of tyres with own synthetic rubber production.

Strategic investors: Michelin (France)

Value for money

Used to be a tyre plus petrochem company but now focused on tyres only.

Big capex in 2014 and lower sales result in FCF negative. But this should be coming to an

end. Also receivable days increased as giving better terms to buyers.

On the motorcycle side primary suppliers to Yamaha and Yamaha has been losing market

share. So GT's share has also declined from about 60% to now 50%.

Nearly 20% share in the radial tyre market, where they produce

Bias Tyres (used for mining and plantation) has been slow on the back of weakness in the

industry, but still growing at about 5%.

Replacement demand is slow; down 12% in Bias, -1% for Radial and -4% in motorcycles.

But OEM for radial has growth 65% and export sales up 31%.

New plant on Bus and Tyre radial will increase the capacity from 350/day to 2,200/day. As

road conditions improve the company says it will be good for radial tyres for buses and

trucks.

The company says it will be the first to build this capacity within Indonesia.

Jialong Shi

+852 2101 7437

jialong.shi@credit-

suisse.com

Jahanzeb Naseer

+62 21 255 37977


suisse.com

31 March 2015


Genting Singapore (GENS.SI)

Speaker: Elena Arabadjieva (Head of IR)

New News: No

Tone: Negative

New Jurong hotel expected to open in May 2015, about 550 rooms. Pricing to be about

half of Resorts World Sentosa rooms.

According to management, outlook for VIP appears challenging. GENS will instead focus

on Premium Mass segment, targeting regional players.

Management still hoping Japan legislation will be passed by mid-2015, after which

lawmakers have one year to finalise regulatory framework.

Globe Telecom (GLO.PS)

Speaker: Alberto de Larrazabel, CFO

New News: No


Focusing on data growth rather than competition. Globe has been gaining mobile

revenue market share from PLDT over the past 12 months. While this was in part due to

Globe's strong execution and PLDT's relatively slow responses, Globe highlighted that this

was mainly driven by its focus on data businesses both for mobile browsing and wireless

broadband, as reflected in its data-centric offers/promos, data VAS (FB, Viber, Spotify,

NBA), and capex spending over the past few years. Importantly, Globe noted that its focus

on mobile data also led to higher top-up of voice and SMS on its network (instead of

cannibalisation), and that Globe is now focused on driving data growth/monetisation rather

than competition / market share.

PLDT is trying to stabilise shares, but still rational and focus on data. Globe

acknowledged that PLDT has stepped up its effort toward the end of 3Q14 to try to

stabilize its market share decline. While this appears as an increase in competitive

intensity, Globe noted that PLDT has in fact been fairly rational, focusing its effort on

driving data users (e.g. Free Internet promos) and there's some effort to also move away

from unlimited data toward volume-based charging, which could be positive for the sector

in the medium to longer term in Globe's view.

SMS decline imminent, question is when and how. Globe noted that so far it has not

seen material impact from higher data penetration on SMS usage/revenues yet. Globe

noted though that this probably was due to relatively low smartphone penetration rate on

prepaid side (<20%), and that the decline in SMS usage is imminent but the timing is

uncertain. Globe (and PLDT) would still need to focus on data monetisation/ bundling

more on the prepaid side to ensure that there's ARPU and profit uplift as transition

happens.

EBITDA margin comfortable at current level. While margins on data are lower than

traditional voice and SMS services, Globe is confident it could maintain the current level of

EBITDA margins over the next few years, driven by scale efficiencies of data revenues

and cost initiatives.

Capex to remain high over next few years, future depends on data. Globe maintained

its capex outlook for US$650 mn this year (US$800-850 mn in cash capex given spill-over

from last year) and that it could remain at the current level for a few years. Globe noted

though that the key is the shift in capex mix, away from traditional and that upto 70-75% of

current capex budget would be on data, which should lead to future growth. Globe also

affirmed its 75-90% payout policy and that DPS would not decline YoY despite higher cash

capex.

Foong W Loke

+ 60 3 2723 2082

foongwai.loke@credit-

suisse.com

Chate Benchavitvilai

+65 6212 3241

chate.benchavitvilai@credit-

suisse.com

31 March 2015


HCL Technologies (HCLT.NS)

Speaker: Anil Chanana, CFO

New News: None

Tone: Neutral

The infrastructure business remains strong: $40 bn of deals will come up for renewals

in 2015 and 30% changes hands, so that is a large opportunity, according to management.

Europe remains an important growth driver: Europe growth is strong as the market

opportunity is significant due to low penetration of offshore outsourcing. HCLT follows a

layered hedging policy and hedges cash flows and balance sheet. Up to 40% of next

year’s inflows is hedged. The impact of the European currency is less on the financials – a

1% change in the INR versus the USD impacts margins by 20 bp but a similar change in

European currencies impacts margins by 5 bp.

Recent growth has been strong due to recent deal wins: The Dec quarter was

particularly strong as recent deals started kicking in. Visibility of deals is very good for run-

the-business. For a new deal, the transition phase does not have any revenue recognized

but once that's over, revenue flows.

Management continues to see medium-term margin range compressing to 21%: This

compares to the current levels of around 24%. Significant investments are being made in

areas such as onsite delivery centres and new labs. This could happen sooner rather than

later.

M&A strategy: Gaps will be filled such as engineering services in Europe.

The energy vertical is quite small: Energy is part of public services and is less than 5%.

HDFC Bank (HDBK.BO)

Speaker: Aditya Puri, Managing Director

New News: Yes

Tone: Positive

Competitive environment stable: Retail loan demand is seeing gradual pick-up though it

primarily has been in the CV segment only so far. Competitive environment has been

stable with credit standards holding and pricing hasn’t come under too much pressure as

well, as most competitors have been rational. However, management believes that lending

rates should gradually come down as rate cycle moderates.

Rural expansion has been playing out well: After the aggressive expansion in non-

urban regions, these rural branches have started to break up. Even though rural India's

economic activity has slowed recently, there is no asset quality pressure in the segment as

the bank’s focus was only on high quality top 20% of customers in those geographies. As

operating leverage benefits of last few years' branch expansion has started to come

through, overall cost income ratio has moderated from ~50% (FY13) to 44% (9M15). As

per management, there is further room for this to come down on back of operating

leverage benefits as growth picks up further.

Digital initiatives to drive higher cross sell: Driven by digital and other technology

initiatives they have been able to better direct products to existing customers. This is

leading to an improvement in hit rates and driving improvement in cross sell ratios.

Anantha Narayan

+91 22 6777 3730

anantha.narayan@credit-

suisse.com

Ashish Gupta

+91 22 6777 3895

ashish.gupta@credit-

suisse.com

31 March 2015


HDFC Ltd (HDFC.BO)

Speaker: Keki Mistry, Vice Chairman & CEO

New News: None

Tone: Positive

Demand environment healthy; competition stable: Management highlighted that

demand from non-metro regions especially tier II-III cities remains robust and competitive

intensity hasn’t gone up compared to past few years. Further a potential pick-up in non-

retail business post slowdown in past three years would aid to overall loan growth.

Pressure easing on retail spreads: Mortgage rates have been stable with the banks

unwilling to cut their base rates. With stable lending rates and drop in wholesale funding

cost, HDFC has witnessed a moderate expansion in retail spreads. Management believes

that as banks reduce the base rate, the benefit will be passed on to borrowers

Insurance JV partners keen to raise stake: HDFC's insurance JV partners for both life

and non-life are keen to raise their stake, according to management. With the parliament

passing insurance bill, both HDFC and Standard Life are interested in getting the

insurance subs listed with likely timeline for listing by next year.

Hollysys (HOLI.OQ)

Speaker: Jennifer Zhang, head of investor relations

New News: None

Tone: Positive

According to management, FY2015 profit may hit the upper range of guidance and sales

may hit the lower range.

Industrial automation: Industrial automation order has improved in Jan and Feb YoY,

with narrowing decline. However, visibility is low for order execution. The industry growth

is more about long-term steady growth rather than an explosive one; 5-10% sales are

nuclear while 10-15% are after-sales service.

Railway signaling business: Railway backlog and new order are much stronger in

FY2015 than last year. Therefore, the company maintains low single-digit growth guidance

for railway in FY2015. Recently, the second ATP tender started with 100 sets (valuing

Rmb150 mn). TCC and ATP revenue will likely maintain at the current level; track circuit

and ATO are the future railway growth drivers. Hollysys and CSRC are the only players in

the inter-city ATO market.

Profitability: Gross margin for new track circuit product is of low visibility as the company

does not have orders yet; however the company expects at least 35%. ATO gross margin

is similar to ATP and TCC.

Cash utilisation: R&D and overseas M&A in factory automation are the future uses of

cash. The company targets approximately US$100 mn on M&A. Both cash and equity are

of consideration for acquisition.

Share buy-back is one of management considerations. But, no concrete plan has been

made.

Overseas: The Singapore staff is mostly sales people and R&D team is much smaller

than Beijing and Xi'an. It is planning to build a factory in Europe to improve after-sales.

Ashish Gupta

+91 22 6777 3895


suisse.com

Baiding Rong

+852 2101 6703

baiding.rong@credit-

suisse.com

31 March 2015


Homeinns (HMIN.OQ)

Speaker: May Wu (Chief Strategy Officer), Cathy Li (CFO), Zason Zong (COO)

New News: None

Tone: Negative

China travel sector

A segment seeing resilient growth. Outbound has been taking shares from inbound.

Lodging sector is less affected by the fierce online competition than retail sales

Budget hotel segment

Affected by soft macro economics. Branded chain still remain more competitive to

consumer; branded chains enjoys higher occupancy rate (85%-90%) than overall sector

(60-70%). 2M15 performance surprised to the downside

Homeinns

Strategy for FY15 is to focus on Tier 1 and 2 cities. Location-wise, coastal cities performed

better than North and inland China. Midscale hotel segment is performing better than

economy hotel. Continue to sell through direct channels; now member booking accounts

for 62%. Prudent and cautious expansion in FY15 with target of 400 new hotels, of which

100-120 would be mid-scale hotel. Launch of the new mid-scale hotel brand 'Homeinn

Plus'. Other initiatives include B2C platform for product sales, and B2B service to other

hotels. Expect decent free cash flow as it is now switching to light-asset model

Q&A

Use of free cash flow: (1) Share buyback of up to US$35 mn in a year just announced in

March; (2) payback of convertible bond; and (3) cash return to investors in FY16

Franchise portion: 60% unit; 14% revenues; 90% of new hotels

Competition landscape: 2014 is an inflection point, Midscale sector will be the bright spot

into 2015. Homeinns will strengthen in this segment. Midscale hotel requires higher quality

so it is not easy to find suitable properties and takes longer time to develops, so Homeinns

doesn't expect intense competition immediately. Economy hotels are rather seeing more

competition.

RevPAR trend in soft macro: 2M15 was pessimistic but March sees some pick-up so far.

For 2015, Homeinns sees low-single digit decline

Leisure travel mix: In holiday (3Q) 40%, low seasons like 4Q will be down to 30%; still

sees healthy trend in leisure travel

New hotel: More (30%) conversion from existing hotel, this trend will continue

Midscale hotel: is now similar to the begging phase of budget hotel where demand is

higher than supply. There is not yet a strong or dominating brand in this sector.

How to compete with more international brand in Midscale: now Homeinns has two brands,

Yitel (Rmb400-500 ADR) in Shanghai that offers competitive price, and Homeinn Plus

(Rmb300-350 ADR) targets different customers.

Franchisee partners: Homeinns targets 15-20% IRR for themselves and for their

franchisees. This return is still quite attractive to the franchisees.

Disneyland in Shanghai in 2016: Homeinns now has 10% in Shanghai and 15% revenues

from Shanghai;

Franchise model: Upfront of Rmb3,000 per room; 6% management fees; discount offered

to franchisee that has multiple hotels

Customer mix: Less than 5% customers are foreigners. Still expect Homeinns is strong;

suits domestic customers.

Sophie Chiu

+852 2101 7657

sophie.chiu@credit-

suisse.com

31 March 2015


What is adjusted in non-GAPP net income: Major difference is fair market valuation and

share-based compensation.

Impact due to anti-corruption policy: Some hotels are suffering due to less business travel.

Expect limited impact from now.

O2O impact: Homeinns focusses on products and services which will determine the

competitiveness. Don't think OTA will threaten Homeinns' performance that much.

Margin: Last year Homeinns achieved flattish margin even with a negative RevPAR due to

some efficiency improvement. Expect flattish margin to sustain in FY15. But if RevPAR

continues to go down it will be challenging to keep. However, if RevPAR recovers,

Homeinns is confident to see decent rebound of margin.

Hong Kong Electric Investment (2638.HK)

Speaker: Wong Kim Man, CFO

New News: None

Tone: Neutral

5bn permitted return every year. Stable yield. 100% payout of cash flow.

Very stable demand outlook. 70% of the customers are commercial sites. They are

forecasting 0.5% growth p.a. going forward.

Capex. HK$13 bn for 2014-18 (1.6 bn in customer services, 6.1 bn in generation, 5.3 bn in

transmission and distribution).

Tariff. Will stabilise until 2018.

Future fuel mix update. An overwhelming majority is in support of option 2 to increase local

natural gas generation instead of importing more electricity through mainland power grid.

The government is considering another consultation on power market reform probably in

the next few months.

Debt structure. HK$37 bn bank loans to be refinanced in 2017. Percentage of fixed rate

debt may come down from 90% to 50%.

HTC (2498.TW)

Speaker: Kelly Hsu, Christine Chi - Investor Relations Managers

New News: None

Tone: Neutral

Key focus on growing shipment scale and better promotion of the brand. The

company indicated that it shipped 20 mn in 2013, grew in 2014 and expects to grow units

again in 2015. The company is still #3 in the high-end, but its global market share is now

below 2-3% so focus is on expanding scale from NT$40-45 bn/quarterly run rate and

diversifying to non-handset products.

Disciplined on opex, focus on improving the brand image. Opex has been pretty

stable with R&D at NT$3-4 bn/quarter, G&A at NT$1 bn/quarter with marketing the swing

factor based on projects and branding campaign. The “quietly brilliant” will become an

internal slogan for employees to stay humble and a new brand image campaign is based

on “Pursuing Brilliance”. It hired a new CMO Idris Mootee to better promote the brand. It

will also have more partnerships, noting its partnership with Under Armour and Valve.

HTC One (M9) upgrades. The company targets shipments of its M9 flagship smartphone

series flat to up YoY, with M8 last year its top selling product for units/sales and close to

Dave Dai

+852 2101 7358

[email protected]

Pauline Chen

+8862 2715 6323

pauline.chen@credit-

suisse.com

31 March 2015


half of 2014 sales. The company believes it can grow sales with more variations of M9 and

better device. HTC highlighted enhancements to its HTC One M9 are to give it more of a

luxury phone with upgraded features: (1) new dual tone scratch resistant finish, (2)

upgraded silicon (processor with Snapdragon 810, DRAM upgraded from 2GB to 3GB and

32-64GB NAND, (3) BoomSound speakers on top and bottom, and (4) upgraded camera

to 20 MP back camera and 4 MP Ultra-pixel front camera. Pricing will be NT$21,900 in

Taiwan and US$299 in the US (with contract).

Sense 7 UI update. HTC’s new software offers (1) location specific home page, (2)

BlinkFeed now collaborating with more localised services (Yelp, Foursquare), (3) more

customisation with possibilities to monetise (icons, sounds, fonts), and (4) eye experience

for better group calls, split screen pictures and selfie pictured functions.

Mid-end portfolio broadens. The company has broadened Desire range spanning both

to lower price points with Desire 200 (US$150) for India and more mid-tier and specialty

models including Desire 510 for US prepay (HTC’s most popular model since 2012),

higher-end Desire 820 and Desire Eye for photo enthusiasts.

Focusing also to diversifying beyond smartphones. The company launched one

product last year and 2 YTD already, with more non-smartphones products in 2016-2017.

The company introduced RE camera (16 MP) in 2014 for easy picture taking and this year

already has launched HTC Vive virtual reality headset (a project underway for the past 2-3

years) and HTC Grip fitness band. The company has been in talks with partners on

applications for the virtual reality headset for tourism and medical training. HTC has

targeted to reach 1 bn connected devices with HTC smartphones as the "hub" for data

collection. The company now outsources a few smartphone models to ODMs to have

more resources to broaden to non-smartphone products.

Huaneng Power International (0902.HK)

Speaker: Hui Zhou, Vice President & Chief Accountant

New News: Yes

Tone: Negative

Regarding the power reform, the company is interested in power retail business but would

like to wait for further policy details. It could take a long time before the full roll-out of the

reform. Huaneng's Singapore business (Tuas Power) has power retail segment which

helps the company have a better understanding of the retail industry. HNP has started

sending their local power plant managers to visit Tuas Power to learn from its experience

in a fully competitive power market.

The company sold 10bn KWh electricity (~3% of HNP's total output) through direct power

sales in 2014, and the price is 3-4 fen per kWh lower than benchmark coal-fired tariffs.

The company believes the lower tariffs are resulted from over-supply of electricity.

The company expects unit coal cost to drop 3-4% YoY in 2015 while unit fuel cost would

stay flat YoY due to increasing high-cost gas-fired power (9% of total capacity).

Thermal utilisation may deteriorate in 2015 and the company is trying to achieve flat or

small YoY decrease in utilisation hour in 2015. Regions with larger capacity from

renewables power may see larger downside on thermal utilisation.

Management has not received any confirmation on coal-fired power tariff cuts yet. This

time, the local tariff cuts will be largely decided by local price bureau instead of NDRC.

The cost research at local power plants has been conducted for more than two months.

There is no further detailed parentco asset injection plan that can be disclosed at the

moment. The project IRR hurdle for injection is 6% (usually larger than 8% for those

already injected).

Dave Dai, CFA

+ 852 2101 7358

[email protected]

31 March 2015


IDFC Ltd (IDFC.BO)

Speaker: Bimal Giri, Senior Director, Strategy, Planning and IR

New News: Yes

Tone: Positive

On track to convert to Universal Bank by October 2015.

Structural elements of transition falling in place: Management doesn’t expect private

infra demand coming through before FY17. To start, the focus will be on leveraging large

corporations' relationships and tapping into their ecosystem. IDFC wholesale banking will

broadly have two verticals. The first will focus on expanding large corporate relationships

from infrastructure projects. The second vertical will focus on mid-corporate and SME

vertical and will be built initially by leveraging large corporate relationships.

Business plans firming up: Management plans to open 500 branches in the first five

years of operation. The retail lending piece will be entirely greenfield and top level hires

have all been made. The bank will have differentiated strategies for urban and non-urban

regions. Urban consumer bank will focus on liabilities and affluent segment. In non-urban

regions, focus will be mass segment and a more asset-led strategy. These assets will help

to meet the PSL requirements for the bank.

Transition pains lower: According to management, during the transition, trough ROA

should be 1.1-1.2% and ROE should be 9-10%. Post transition, ROA should move up to

1.6% and the target is to scale it up further to 2%. Management further highlighted that

IDFC’s ROA can be better than other banks in the system as they will have higher ROA

Infra business funded by long-term infra bonds.

IJM Corporation (IJM MK)

Speaker: Dato Soom (Deputy CEO)

New News: None

Tone : Positive

Construction order book at RM7 bn now and outlook for new orders remains promising,

according to management, while margins remain favourable.

Property unit facing headwinds, management indicated, but earnings underpinned by

healthy level of unbilled sales.

Soon-to-be completed IJM land privatisation will lead to close to 20% increase in share

base and expected to generate synergistic benefits, according to management.

Management expects infrastructure unit to be a key earnings growth driver with

commencement of tolling on Besraya extension in May 2014 and on-going works to

double capacity of Kuantan Port.

Indofood Agri (IFAR.SI)

Speaker: Mark Wakeford (CEO) and Fajar Triadi (Investor Relation)

New News: None

Tone: Neutral

Diversified integrated agribusiness group: IFAR currently has ~300,000 ha of total

planted area, dominated mostly by oil palm. The company has both upstream plantation

business in palm oil, sugar and rubber, as well as downstream refinery business.

Ashish Gupta

+91 22 6777 3895


suisse.com

Danny Goh

+60 3 2723 2083

danny.goh@credit-

suisse.com

Tjitra, Priscilla

+62 21 255 37906


suisse.com

31 March 2015


Around 80% of upstream output gets moved down to the downstream side, of which 40-

45% is sold to related party, Indofood, at market prices.

Upstream plantation: Oil palm is the major part of the business. Typically new planting

has been at the rate of 10,000-15,000 ha per year. Over the recent years, it has slowed

down to below 6,350 ha in 2014 because of the harder license requirement from the

government. Management is expecting production growth around 5% every year for the

next three years coming from the currently 60,000 ha immature area. 85% of IFAR profits

come from the plantation business. Apart from growth in volumes, the company is a price

taker (following CPO prices). Management's focus is on improving yields, productivity and

managing costs.

Downstream business: Management believes that overcapacity of CPO refineries in

Indonesia will continue for quite some more years. Currently, total capacity reached 45 mn

tonnes p.a., versus 30 mn tonnes of Indonesia annual CPO production. Domestic

refineries must pay $10-15/ton premium to compete for the fruits and maintain utilisation

rate at a favourable range. As a result, refinery margins have been very thin in the past

few years.

IFAR's refined output is mostly cooking oil (60-70% volumes), and its pricing moves in

tandem with CPO price, adjusted every 6-8 weeks. Margarines and shortening prices tend

to be stickier. The company did +5% price increase in December and again in January.

Management is expecting 1Q15 refinery margins to be similar to 4Q level. Margins will

only improve in 2Q prior to Lebaran because of higher volumes processed.

Indofood CBP (ICBP.JK)

Speaker: Werianty Setiawan, Director; Clara Suraya, Investor Relations

New News: None

Tone: Positive

ICBP has six portfolios in Indonesia's consumer staples that include noodle (65% revenue,

97% EBIT), dairy (18% revenue, 10% EBIT), beverages (6% revenue, EBIT negative),

snack foods (7% revenue, 3% EBIT), food seasonings, and nutrition and special foods. It

is entering into its seventh portfolio, which is the diaper business. The company has a JV

with Japan's OG Paper to set up manufacturing in Indonesia, whereby it has secured the

land plot and will likely be in commercial operation in the next two years.

Its latest venture into beverages is a JV with Japan's Asahi, whereby its plant in Indonesia

will be on commercial operation soon for manufacturing the ready-to-drink (RTD). At

present it has marketed RTD tea and RTD coffee, whose products are imported from

Malaysia and Thailand, thus resulting in margin compression with Rupiah weakening last

year. Meanwhile, around 50% of the beverage revenue is derived from bottled water

(Club), which the JV acquired last year.

The dairy segment will include the contribution from the Milkuat acquisition this year, as

such the company has estimated a volume growth of 18-20%, with EBIT margin of 6-8%.

The segment was hit by the rise in the skim milk powder last year, as well as the Rupiah

depreciation. Skim milk powder is imported from New Zealand. Majority of its products is in

the sweet condensed milk (SCM), whilst the remaining is liquid milk (UHT, fresh milk). The

group is looking to have a dairy farming in Indonesia, in order to secure its supply of raw

milk, which is currently provided by the farmers under the co-operatives.

Noodle business continues to be the backbone of the company, as it provides a good cash

flow. Its EBIT margin improved last year to 15%, from 13%, despite of the slightly lower

volume growth as the company continues to pass on the increase in cost to the consumer.

This year, the company is targeting a volume growth of 1-3%, with EBIT margin expected

at 13-15%.

Ella Nusantoro

+ 62 21 255 37917

ella.nusantoro@credit-

suisse.com

31 March 2015


Capex is estimated at Rp3.2 tn this year, as compared to Rp1.7 tn it spent last year. This

year's capex include the Rp1.1 tn carried over from the previous year, which was allocated

for the consolidation of its two noodle factories (it has yet to be able to find a suitable land

in the location).

Inotera (3474.TW)

Speaker: Scott Meikle, President

New News: Yes

Tone: Neutral

Bit growth limited in 1H15; Sales impacted near term by PC weakness. DRAM bit

output is now expected down a little QoQ in 1Q15 vs initial flat QoQ guidance due to more

mix of larger die DDR 4 in the quarter, and 20nm is more a 2H15 ramp. The company

adjusted down sales in February with its revised monthly sales release due also to

weakness in PCs impacting ASPs and expects that would flow into March. Non PC units

and sales remain healthy. The company believes 2Q15 bits will be stable QoQ and then

growing with 20nm in 2H15.

20nm to ramp at a steep pace in 2H15 – yields in line with expectations. Inotera

acknowledged the 30nm to 20nm transition has been challenging but in line with

expectations and power/performance now in line with Hiroshima. 20nm will ramp at a

steep pace in 2H15, with wafer starts starting from 2Q15 and converting 80% of capacity

and reaching 80,000 WPM starts on 20nm by 4Q15 with cross-over in 4Q15/1Q16. The

company still expects 85-88% higher bits by mid-2016 but offset by fewer wafers due to

larger die size and less bits/wafer shifting to mobile DRAM to get 60-70% higher bits by

mid-2016. 2016 will be a year of aggressive cost reductions.

Mix of production diversifying with 20nm. Bits are currently 65%

enterprise/client/networking and 35% PC client on 30nm. With 20nm, mix will diversify

with 10 parts in the fab, with PC client flat or coming down over time. DDR4 is ramping up

well to capture more enterprise demand.

Maintains 500bp impact from the revised pricing agreement with Micron. Inotera

maintains that the new pricing agreement would have about 500bp GM impact in 2016-17

as noted when it renegotiated. The company will depreciate based upon the formula; on a

six-year depreciation simulation vs financial accounting on an eight-year depreciation,

thereby limiting some of the margin impact with the new formula.

Other relationships to diversify some output long term. Inotera still views itself as a

low cost silicon provider in Taiwan with potential options; long term if it needs them.

Inotera has been doing a lot of work on its ASE packaging JV, though revenues are more

likely from 2017.

Capex at least NT$50 bn in 2015, coming down in 2016. Inotera spent NT$22 bn in

2014 and maintains NT$50 bn capex in 2015, up from NT$22 bn as it needs to have more

deposition and etc. The company will be mostly done with the 20nm transition in 2016 so

capex can be down sharply. It will still transition 20nm from 80% to 100% of bits in 2016

but that should require much less than the NT$22 bn spent in 2014.

1xnm deployment looks to be 2017 timing. 1xnm pilot activity may start from 2016 but

is more likely a 2017 ramp.

Randy Abrams

+ 886 2 2715 6366


suisse.com

Keon Han

+82 2 3707 3740

keon.han@credit-

suisse.com

31 March 2015


JMEI (JMEI.N)

Speaker: Sterling Song, IRD

New News: Yes

Tone: Slightly positive

After the restructuring, almost 100% of cosmetics are under merchandise sales starting

from 4Q14. The company will focus on growing topline and acquire more customers this

year, and target to maintain 27% gross margin for cosmetics in 2015E. Take rate on 3P

business will be relative stable around 14-15%. The GMV breakdown for 2015E will be

70% and 30% for cosmetics and non-cosmetics categories, respectively. Over 60% of

orders were from mobile in 2014.

Jumei Global, its cross-border initiative, grew nicely since inception. Currently, most of the

sales on Jumei Global are cosmetics products from Korean and Japan. Almost 90% of

Korean cosmetics products sold on Jumei Global are under exclusive contractual

agreement. The company will gradually expand to other hot cross-border categories, such

as light luxury and baby maternity products. It co-operated with Gilt in the March 1st

annual sales to try out the sales of non-cosmetics products. The order size on Jumei

Global is generally 15% lower than overall order size. Going forward, the company will

balance between the sales on domestic channels and Jumei Global to provide better

quality products with lower price.

The company is enjoying a higher tax-free base in bonded area in Zhengzhou. Products

over Rmb120 are tax free compared to Rmb108 initially, and Rmb100 nationwide. The

total floor area of warehouse in bonded area has reached 10k square meters. Products

with price over Rmb120 will be subject to effective tax rate of around 30%.

JSR (4185.T)

Speaker: Nobu Koshiba, Representative Director and President, Masaru

Yokoyama, Manager, Financial section

New News: Yes, outlook for 2015

Tone: Positive

Outlook for FY15: Growth driver expected to be semiconductor materials and LCD.

Synthetic rubber will likely be in oversupply towards 2016. Butadiene supply and demand

balance should be tight towards 2018 but 2015 should see weak demand and supply.

Synthetic rubber profit environment will probably be tough in 2015 compared to 2014.

Semiconductor material outlook: The company expects semiconductor market to register a

4.6% CAGR from CY2013 to 2018. Due to miniaturisation technology development,

photoresist demand growth should be higher than wafer shipments. Logic and memory

demand should be strong and JSR holds 60% market share for TSMC and Intel for ArF

photoresist. iphone6S demand is expected towards September.

LCD market outlook: Large size LCD TVs drive demand growth for LCD. Volume growth

expected to be 7-8% and value growth to be over 3%. Mobile ratio is expected to decline

from 20% to 17% due to good growth for LCD TVs.

New business: Focus on LIC (Lithium Ion Capacitor) and life science business. LIC should

be growing in automotive and machinery. Life sciences focusses on bio/drug discovery

fields and antibody chromatography technology. The company plans to grow its

biopharmaceutical manufacturing process business.

Evan Zhou

+852 2101 6745

evan.zhou@credit-

suisse.com

Masami Sawato

+ 81 3 4550 9729

masami.sawato@credit-

suisse.com

31 March 2015


KEPCO (015760.KS)

Speaker: Changyoung Ji, Investor Relations

New News: None

Tone: Positive

Lower fuel cost to be reflected from 2Q15 earnings due to time lag in reflecting lower oil

price into LNG price.

Tariff outlook. The company aims to freeze power tariff YoY (additional cost offsetting cost

savings from falling fuel cost). There may be some adjustment for effective tariff by sector

(residential vs commercial vs industrial), but on a blended average basis management

targets for almost no change.

Proceeds from land sale to be used to pay down debt, capex and dividend payment.

Dividend – FY15 dividend to be raised based on 30% payout ratio (which they aim to

increase to 40% by 2017) of parent based earnings.

Las Vegas Sands (LVS) / Sands China (1928.HK)

Speaker: Daniel Briggs, Senior VP, IR. Jason Cheong, Director, IR

New News: None

Tone: Neutral

Business update: Mass-market has seen some stability relatively. Sands will continue to

invest in expanding the products offering to attract traffic, which is necessary to drive the

mass-market growth as well as retail. VIP business is a structural issue. Junket

consolidation is still ongoing. Despite the weak revenue trend, no plan to re-launch the

tele-betting for better compliance of know-your-client (KYC) procedure.

Having said that, Sands is not shifting focus away from Macau.

On policy address. Government estimates of GGR for 2015 (MOP20 bn/month, or -32%

YoY) appears to be conservative and may set the floor for GGR. After all, social stability is

the primary focus for the government. Table allocations would depend more on the

investment in Macau, especially in non-gaming, but clearly every project would get less

tables than existing ones.

Large asset base facilitate Sands to get new players. Hotel room comp ratio has

gradually increased from ~35% last year to ~40% now. With large room inventory, Sands

is flexible to comp or sell rooms at lower rate to attract players, which is unlikely to be

replicated by its peers.

Margin: Expect continuous shift of GGR mix towards mass-market (+ve to margin) but

labour pressure remains an issue after 5% payrise for 2015 announced earlier and

committed staff retention program. The company is not laying off staff but replacement

would be limited for turnover. Cost-saving is expected from revisiting some fixed costs, e.g.

branding and promotional cost.

Parisian Macao opening depends on the approval of construction worker quota. Currently

4000 workers are on site, which should allow construction to finish by end-2016.

Management believes the government may want to phase the projects opening in Cotai by

around six months' interval.

A-Hyung Cho

+ 82 2 3707 3735

a-hyung.cho@credit-

suisse.com

Isis Wong

+ 852 2101 7109

isis.wong@credit-

suisse.com

31 March 2015


Lenovo (0992.HK)

Speaker: Yuanqing Yang, Chairman and Chief Executive Officer

New News: None

Tone: Positive

Experience is the king. According to management, Lenovo is focusing on delivering

unparalleled user experience across any device, securitising the platform, and providing

real-time customisable application platforms.

Segment highlights from management

PC - growth through consolidation: Consolidation leads to scale and profit. Top

three will further consolidate market share and profit; remaining companies lack scale.

Tablet - impacted PC but has merits: Tablets also positively revolutionised the PC

industry through form-factor and feature advancement, which not only enhances the

Lenovo experience but also provides real value to the consumers.

Motorola - exceptional user experience: Motorola delivers premium consumer

experience and has a strong foundation of IP, brand, and R&D expertise.

IBM - powering the enterprise: Enterprise is the backbone of social mobile

networking; 400 mobile devices are supported by one server.

Lenovo's market positioning is very unique. As highlighted by the CEO, HP and Dell

have PC and servers; but no mobile business. Apple and Samsung have PC and mobile,

but no enterprise business. Lenovo combines all three elements.

China is fostering technology innovation. China is creating a climate for technology

innovation and changing from both public and private sectors, according to Lenovo CEO.

LG Chem (051910.KS)

Speaker: D.H.Kim, Head of IR; Sol Yoon, Manager of IR

New News: None

Tone: Neutral

2015 outlook (petrochemical): Management guided to better performance from the

petrochemical segment amid lower oil prices, stemming especially from the ABS,

acrylate/SAP and NCC segments

ABS/EP – currently attaining healthy margin (~US$400/T, similar levels to those in

2010/2011) and the largest portion of sales (30%). Expecting high single digit OP% in

2015. Healthy S/D outlook as capacity additions in 2015/16E only take up less than 1% of

current global capacity

Acrylate/SAP – with new capacity additions coming online (SAP 80kT/year, acrylic acid

160kT/year), management expects double digit OP% in 2015. Management is optimistic

that the supply glut from China will not adversely impact company's performance as LG

Chem is targeting high quality products

NCC/PO – Currently running at near full capacity, and naphtha crackers are enjoying

higher cost competitiveness amid lower oil prices. Coupled with management’s positive

S/D outlook and the impact of lower oil prices on inventory (two months lagging effect),

management sees a meaningful earnings turnaround from 2Q15 onwards. 1Q15 should

still see a slight improvement QoQ but the overhang of the inventory adjustment and

maintenance shutdown still lingers. Management is confident that its naphtha crackers’

advantage will be sustainable due to delays in CTO commercialisation and lower

investments in shale gas in Qatar

Thompson Wu

+ 886 2 2715 6386

thompson.wu@credit-

suisse.com

Kenneth Whee

+ 852 2101 7319

[email protected]

31 March 2015


Management foresees demand picking up as restocking activities continue after the

Chinese New Year (with the Chinese players keeping low inventory levels)

PVC/Plasticizer and Synthetic Rubber – slightly better outlook in 2H15 only

Long-term outlook for Energy Solutions (batteries): Management guided for improving

margins for the mobile battery segment, whereas the automotive battery segment may

only see a meaningful improvement from 2016 onwards

Mobile battery – Management expects improved earnings (high single digit OP%) in 2015

amid ramping up of new polymer line (from 34 million cells/year to 40 million cells/year)

and diversification of customer base

Automotive battery ‒ Management expects OP to stay at a similar level in 2015 as

compared to 2014 (loss) despite a 20% increase in sales (to ~W600 bn in 2015), as the

sales contribution from the roll-out of Gen II batteries will likely only come from 2016

onwards. Management guided to W1.3 tn of sales in 2016 (EBIT breakeven), W2 tn of

sales in 2017 (high single digit OP%) and W3 tn of sales (double digit OP%) in 2018. LG

Chem has already signed 40 contracts with 10 automotive producers. Current capacity

amounts to 3 GW/hr with a new plant in China (0.8 GW/hr)

2015 outlook (I&E materials): Management expects the glass segment to record losses

in 2015 and for it to reach break-even in 2016. The second glass line investment will be

put on hold till the first line reaches break-even point. On the other hand, earnings are

expected to improve for the polariser business due to strong demand from panel markets

and the increased utilisation rate of Chinese new polariser lines. Management expects a

high single digit OP% in 2015 amid a positive S/D outlook

2015 capex guidance remains at W1,790 bn

Long-term dividend policy is due to remain at around a 25% payout ratio (recently

announced 2014 dividend of KRW4,000/share)

LG H&H (051900.KS)

Speaker: Jimin Kim, Jiyeon Ha, Investor Relations

New News: None

Tone: Positive

YTD operations – YoY improvement led by (1) robust high-end brands in cosmetics and

(2) TFS operations that improved post the restructuring in China within 2014.

Household goods – stable growth YTD, seeing overseas operations as an opportunity

going forward; the worst being behind us (higher cost base in 2014) in the beverage

business.

Inorganic growth opportunity – an option the company's management continues to

consider; looking for a target within the cosmetics/personal care sector that has strong

brand equity value.

A-Hyung Cho

+ 82 2 3707 3735

a-hyung.cho@credit-

suisse.com

31 March 2015


Lifestyle (1212.HK)

Speaker: Terry Chuen, CFO

New News: Yes

Tone: Neutral

Lifestyle saw <1% SSSG growth in CWB Sogo in Jan-Feb, with flattish ASP and traffic

footfall. The operation in March was relatively difficult due to political unrest, and

management also expects a hard April considering the longer Easter holiday season this

year vs last year. Management expects the full-year SSSG for CWB Sogo should be ~3-

4% considering the low base in 2H14. And with TST Sogo operating full year, the overall

top-line growth in the HK market should be higher than that in CWB Sogo alone.

In mainland China, Shanghai and Suzhou stores are doing well and management expects

more than 4% SSSG in SH store and 3-4% SSSG in Suzhou in 2015 with decent margin

expansion due to effective cost control. Shenyang operation incurred a net operating loss

of HK$100 mn in 2014, or a cash loss of HK$50 mn. Yet management believes the worst

is over and it saw continuous growth in GSP in recent months, thanks to continuous efforts

in customer education and product offering, etc. Management believes its operation in

mainland China is healthy and growing at a decent rate compared to its peers by offering

better products and a better shopping experience.

Management believes that before the protests in March, CWB Sogo's performance was

mainly dragged by weak local consumer sentiment. For example, its sales via China Union

pay (i.e., the sales to mainland customer in HK) increased YoY while sales to local

consumers declined in 2014. In addition, its fresh market sales (i.e. to local customers)

declined 20% YoY during the occupy central protest while the overall store sales declined

10%. However, it is concerned that recent protests in residential areas like Tuen Mun and

depreciating foreign currencies like the euro and yen will discourage mainland visitation,

and put extra pressure on CWB sales beside weak local consumer sentiment. Currently

for CWB Sogo, sales to mainland visitors (in Union pay) account for ~40% of total

Management expects the concessionaire rate to be relatively stable, if not upwardly

adjusted, as (1) SH and HK rate set to remain stable, (2) Suzhou rate set to increase

slightly to reach 20%, and (3) Shenyang situation set to improve sequentially.

Labour cost pressure has eased to 4-5% YoY growth in 2014 from more than 15% YoY

growth before in China. Management expects in 2015, it should increase moderately at

single digit growth in China and ~4% growth in HK.

According to management, the company is holding a relatively large amount of cash right

now, with expansion opportunities being remote. Its dividend policy will be 40% of the

current year earnings or last year's dividend amount, whichever is higher. It is doing a

share buy back but not too much room there due to the free float criteria.

Lippo Karawaci (LPKR.JK)

Speaker: Peter Lembong (director); Mark Wong (executive director)

New News: None

Tone: Neutral

FINANCIALS (data as per management's guidance)

FY14 audited statements planned to be published by end of this week

Expect FY14 revenue to grow 25% YoY organically, EBITDA 29% and net profit 13%

Sold Rp3.3 tn to REITs in FY14, estimate Rp600 bn for FY15 and should expect an even

larger amount (compared to FY14) in FY16

Eva Wang

+ 852 2101 7365

eva.wang@credit-

suisse.com

Bernard Kie

+ 62 21 255 37902

bernard.kie@credit-

suisse.com

31 March 2015


Dividend payout policy 15-20%, to be paid out max 30 days after shareholders' meeting in

June

Estimated gross gearing as of Dec-14 was <60% and net gearing <40%

Almost all debt is in USD (bond); principals are hedged using call spread options

Max ceiling range for the 2019 and 2020 bonds hedges are Rp12,500/USD and for 2022

bond is Rp13,500/USD, but maturity is still a number of years away

Company gets dollar income from sale to REITS to cover for interest expenses

PROPERTY (data as per management's guidance)

Rp5.2 tn pre-sales recorded in FY14, higher than the target of Rp4.7 tn

Target Rp6 tn in presales for FY15

Have recorded around Rp1.3 tn up until last week, mostly contributed by Orange County

township in Cikarang

Expects to hear about property luxury tax in April, but the real estate association has been

counter-lobbying the government for higher threshold (IDR5bn) and progressive tax

mechanism

In relation to this, since 4Q14, LPKR has been building and selling smaller units called

'modules' at roughly 40sqm and less than Rp600 mn... People can purchase more than

one module and make them into one unit of property... Example is the Pasadena tower in

Orange County

Worst case scenario; if the property luxury tax threshold came about at Rp2 bn, 20-25% of

LPKR's presales will be impacted

Management said that there may be a chance that the LTV regulation may be relaxed, this

should increase proportion of people purchasing property via mortgage (currently 80% still

uses cash installments)

LPKR is not in a hurry to replenish landbank; currently around 1300Ha as management

plans to go into high rise residentials in their two revamped townships: Millenium city and

Orange county

HOSPITAL (data as per management's guidance)

Siloam to benefit from the national healthcare programme (BPJS)

Siloam is one of the few hospitals with excess capacity to leverage on the potential upside

from BPJS

11 out of Siloam's 20 hospitals are accredited for the BPJS programme

BPJS cash disbursement is approximately two to three weeks after completion of

documentation

Expect to add ten hospitals this year and target for 40 hospitals by 2017

OVERALL (data as per management's guidance)

For overall property development strategy, shifting from landed housings to high rise

residentials

Capex for FY15 is US$500-500 mn, US$250-300 mn for property development, US$75-

100 mn for hospitals, US$75-100 mn for malls, US$50 mn for opportunistic land bank

acquisition and hotels

Capex to be funded from: US$275 mn from proceeds from the sale to REITS, US$200 mn

from pre-sales this year, US$80-100 mn from previous years' pre-sales installments

31 March 2015


LT Group (LTG.PS)

Speaker: Jose Gabriel Olives (CFO), Annabelle Arceo (IR Officer)

New News: None

Tone: Moderately positive

Tobacco business weakened further in FY14. Share in net income at P99 mn from P3.9 bn

in FY13 as the company continued to be adversely affected by illicit trade (under

declaration of taxable sales volumes). Volumes sold in FY14 at 68.4 bn sticks, almost

unchanged compared to last year. Market share stable at 71% of total industry.

...but prospects are improving. Main competitor raised prices by 27% in end-January from

P22 to P28 per pack, reducing the price gap with PMFTC brands. Also, the

implementation of tax stamps in March is seen to further improve the pricing environment

and improve profitability over the mid-term. Key to profitability, even before the introduction

of new excise structure, is more about margin improvement rather than volume growth.

FY14 results. Net income at P4.2 bn versus P8.7 bn in FY13 due to the challenging

operating environment in its tobacco business. Contribution of subsidiaries to net income

as follows: PNB (56%), Asia Brewery (27%), Eton (3%), Tanduay (2%), Tobacco (2%),

Others (10%).

Luk Fook (0590.HK)

Speaker: Kathy Chan, CFO, Nancy Wong, ED

New News: None

Tone: Neutral

Management believes it is hard for a positive growth in 2H FY3/15 (which was previously

expected) considering complex situations. Besides political unrest, management thinks

depreciating currency in Europe and Southeast Asia is also the major factor for weakness

in visitation.

Gem-set jewellery sales mix is higher than normal, especially for that in China which

witnessed meaningful growth in FY3/15 due to: (1) increased efforts in customer education

and (2) increased sales of lower priced items whose price differentiation between HK and

mainland is not obvious in terms of absolute dollar amount.

The number of stores in HK/Macau will be maintained while mainland China is expected to

grow at low double digit for licensed shops in FY3/16.

The rental renewal in FY3/15 was around 20% increment, which was less than

management's previous expectation of ~30%-40%. Management expected an increment

of less than 20% for rental renewal in FY3/16 for more than 20 stores. The labour cost is

expected to grow at low double digit.

Management expects the 3D gold business to turn profitable in around two years' time.

The loss made is narrowing right now, due to the company's efforts, e.g., end the loss-

making shops, recommend high-quality suppliers and franchisees etc.

Alvin Arogo

+63 2 858 7716

alvinjoseph.arogo@credit-

suisse.com

Eva Wang

+852 2101 7365

eva.wang@credit-

suisse.com

31 March 2015


Matahari Department Store (LPPF.JK)

Speaker: Michael Remsen (CEO) and Richard Gibson (CFO)

New News: Yes

Tone: Positive

Mataharimall.com - minimum downside for maximum upside to LPPF:

It is a Lippo group sponsored venture that will sell online Matahari's goods along with

Hypermart products, as well as offering marketplace concept.

Mataharimall.com will be separate from LPPF entity. It allows Matahari to be focused on

its brick and mortars business while at the same time opening themselves to Indonesia e-

commerce opportunity. Matahari's management treats this as an incremental business

rather than cannibalisation to the existing stores.

Management's main risks/concerns:

Slowdown in consumer demand – Matahari SSG grew 8.7% YoY in 4Q, lower than

management earlier expectation. Consumer confidence came down in 4Q but picked up

again in Jan-Feb 2015. Historically, Matahari's customers have been quite resilient, but

having said that the slowing consumer demand is the main concern.

Other risks such as competition, foreign exchange or interest rate are less of a concern for

management

Operating expenses pressure:

Minimum wage rise continues to be a pressure, but the increase is less in 2015 (expect

average 14.2%) compared to 2014 (average 15.9%)

Electricity cost is another pressure due to the removal of subsidy - expect 2015 increase

up to 10%

Expansion/renovation of stores:

Biggest expansion last year was in Artha Gading, effectively the size of one new store

(5,600 sqm). So far productivity is the same compared to before the additional space, so

very positive.

2015 new stores opening target in 12-14 range, more than 2014 of eight stores, but there

will be less of existing stores expansion.

Advantage from having mostly local supply:

Compared to other retailers who have forex challenges (most products imported),

Matahari offers better value to customers, given over 90% locally supplied goods.

Matahari has over 400 suppliers for its direct sales and 500-600 consignment vendors. Its

suppliers so far have been very supportive to the business growth and management

expects this to continue.

3 mn MCC members:

Matahari has 3 mn members through its loyalty card. The company is now looking to

leverage on the huge consumer data it has over the past three years of transactions. It has

an engaged a company from the UK (outsourced) to start doing analysis and provide

insights from the data, starting January this year. One use is to do more effective targeted

(direct) marketing to consumers.

Priscilla Tjitra

+ 62 21 255 37906


suisse.com

31 March 2015


Maxis (MXSC.KL)

Speaker: Nasution Mohammed (CFO)

New News: None

Tone: Neutral

Maxis reiterated low single digit revenue growth and flat EBITDA YoY for 2015. Long-term

capex/revenues likely to remain in the 10-12% range.

Demand for data extremely strong in Malaysia. Volumes have doubled in the past 12

months. At this rate, management believes postpaid users could breach 2GB quota in

coming future.

Given improving operational stats, management is hoping EBITDA could grow in 2016.

Mediatek (2454.TW)

Speaker: CFO David Ku and IR Jessie Wang

New News: None

Tone: Neutral

1Q15 within guidance. Mediatek maintains guidance for sales down 10-18% QoQ in

1Q15 and comfortable with GMs within the 46-48% range with units at 80-85mn. It noted

exports (40% of sales) are weaker in one third of the markets (Nigeria, Middle East,

Russia) due to FX volatility causing customers to draw down inventory to lean levels. The

company acknowledges 3G pressure remains from Spreadtrum for entry tier WCDMA

quad core, which has about 20-30% 3G share on the lower end.

Competition and low-end LTE introduction will still pressure margins through 1H15.

GMs will still be under some pressure through 1H15 due to 4G pressure from QCOM and

low-end 3G pressure from Spreadtrum and impact from introducing an aggressive ultra-

low cost LTE solution (6735M) at lower margins but taking market share.

2H15 products and product mix could stabilize its margins. The company targets to

stabilize its GMs in 2H15 as it gets more mix on its newer platforms which improve on

power, performance and cost structure and diversifies LTE with two solutions across high-

end, mid-tier and low-tier solutions. The company targets getting to 20% of units and 30-

40% of sales on higher-end, one third of sales on mid-end and one third on entry level.

Mediatek is focused on moving to the latest process node at the high-end, moving up to

higher CA modems, and the latest ARM cores.

Staying aggressive on opex for technology and global competitiveness. The

company targets +20% YoY operating expenses to close the gap on LTE, with aggressive

investments on the modems (CAT 6/CAT 10), process migration (shift toward 20/16/10nm),

and focus on new areas including automotive infotainment, networking, wearables and IoT.

The company now has a leading position in after-market automotive infotainment reaching

US$100mn sales this year offering GPS, tablet, entertainment, FM, camcorder and

eventually 4G connectivity. The company targets adding 1,500-2,000 employees to grow

to 14,000 people with new offices in San Diego, Finland and India with a growing portion

on home entertainment and new initiatives (vs. Qualcomm at 31,000 headcount).

New products launching to improve the LTE share – maintaining shipment targets.

The company maintains its targets for growing LTE volumes from 30mn in 2014 to

150mn+ in 2015 and total smartphone shipments from 350mn to 450mn, growing LTE

share of made in China smartphones from 20% to 40%+. Mediatek will have two major

refreshes to improve its position: 1) 2Q15 launch of world mode LTE including CDMA

2000/EV-DO with 64-bit quad core (MT6735/M) and 64-bit octa-core (MT6753) along with

new big.LITTLE high-end platform (MT6795 or Helio X10), and 2) CAT 6 CA (carrier

aggregation) high-end 20nm and mid-range 28nm refresh in 2H15 both using ARM’s new

Foong W Loke

+ 60 3 2723 2082

foongwai.loke@credit-

suisse.com

Randy Abrams

+ 886 2 2715 6366


suisse.com

31 March 2015


A72 cores. The company has completed China/Europe carrier certifications and expects

T-Mobile in US complete at the end of 1Q15 and AT&T/Verizon by year-end.

Improving position at the global vendors. The company noted it is gaining share in the

major non-Apple, non-Samsung brands and is gaining share within each of these brands

(HTC, Sony, LG, and targeting Motorola). Mediatek is growing share at some of these

accounts from 5% to 30%+ and pushing into the premium level.

TV position now stable. The company believes customers’ diversification on TVs has

stabilized now that the merger has been in place for a year.

Melco Crown (MPEL.OQ)

Speaker: Geoffrey Davis, EVP & CFO; Ross Dunwoody, Vice President IR

New News: None

Tone: Negative

Political risks condensed, full smoking ban is expected. Management expected the impact

of (1) China anti-corruption, (2) transit visa restriction and (3) smoking ban to continue

dragging the revenue in the near term. The company believes a full smoking ban (VIP

rooms inclusive) which would be eventually implemented could further hurt revenue.

Enhancing the products offering. To survive the downcycle, the company would rather

enhance the consumer experience than engage in price wars. The utilisation and yield of

tables at City of Dreams remains above its peers.

VIP demand may eventually come back after getting used to the 'new normal'. Junkets

keep moving in/out of casinos but on net; currently there is more closure of junket market-

wide. Given the stable expansion in mass market share, management is confident with the

premium mass business in the long run.

Threats to Studio City. Studio City focuses on premium mass-market but at a lower

segment than City of Dreams. 8000 + staff would potentially be hired for Studio City which

may put pressure on labour costs. The table allocation is uncertain.

Updates on Philippines. Junkets start to operate CoD Manila in coming months. Ramp up

may begin in 3Q/4Q this year.

Midea (000333.SZ)

Speaker: Liu Chengsi, IR Manager

New News: Yes

Tone: Positive

Midea expects its

residential air conditioner (AC) sales to increase more than 15% YoY in 2015, and even

faster growth in commercial AC;

washing machine and refrigerator sales to increase at a faster rate than overall group

sales given the continuous improvement in operational efficiency and new product launch;

small appliance sales to increase ~15% YoY especially for range hood and water purifiers

Midea's domestic sales is growing faster than overseas market, and management expects

the trend to continue in 2015 given the weak overseas demand. Currently OEM/ODM

accounts for ~2/3 of overseas sales but they target to increase the share of self-branded

products with higher profitability.

Isis Wong

+852 2101 7109

isis.wong@credit-

suisse.com

Eva Wang

+ 852 2101 7365

eva.wang@credit-

suisse.com

31 March 2015


Midea's online retail sales value reached ~Rmb10 bn in 2014 from Rmb4.2 bn in 2013,

and expects to see further increase in 2015 to ~Rmb16 bn. Regarding profitability, its net

margin for online sales is ~0.5-1 pp higher than offline sales, mainly due to lower expense

ratio yet offset partially by lower gross margin for online sales. With further development of

online platforms, Midea expects the net margin advantage for online sales to further widen.

Besides working as a sales channel, online business is also seen by management as an

important port to directly get customer profile and behaviour data.

Midea is actively collaborating with Xiaomi in its smart appliances development, and

prepares to launch a lot more products, e.g., possibly air conditioners in April after the new

water appliance launch in March. The gross margin for smart appliances is higher than

traditional ones. More importantly, smart appliance can also work as an interface to

directly bond with the customer and enable precision marketing.

Midea rolled out new smart wifi module at Rmb10 to be installed in its products and even

competitors'. This module helps to connect the appliances to Midea's M-smart system and

allows an alliance with other home appliance manufacturers in smart home development.

Its flagship stores constructed by distributors reached close to 2,000 in 2014 and targets to

grow to 4,000 at end-2016. Midea plans to leverage the network of flagship stores to

collaborate with online sales and optimise its "last-mile" delivery and installation in the

future.

Mitsubishi Chemical Holdings (4188.T)

Speaker: Tsuyoshi Okazaki, IR Chief Manager, Kenta Horie, IR Group

New News: Medium-term earnings outlook

Tone: Positive

FY3/16 OP: The company management is aiming for ¥240 bn OP in FY3/16 due to less

inventory valuation losses and margin improvement for petrochemicals, full OP

contribution for Taiyo Nippon Sanso, and no plant troubles. FY3/15 will be slightly short of

company target (company OP forecast of ¥160 bn) due to more-than-expected inventory

valuation losses.

Management direction: Investors are interested to see the changes for management

direction under the new president from April. The company is going to focus on profitability

rather than sales sizes. ROE target will be set (10% in 2020) and achieving this will require

margin improvement for commodity chemicals and new business profit contribution

(renewable energy and environmental related).

According to management, external environment is quite favorable for petrochemicals

under weaker oil and naphtha prices and weaker yen which is expected to improve global

cost competitiveness.

MPPA (MPPA.JK)

Speaker: Patrick Hoseph Hopper (CFO) and Marchea Phoa (IR)

New News: Yes

Tone: Positive

MPPA runs three businesses:

Hypermart (91% of sales): now has 109 stores

Foodmart (8% of sales): regular supermarket, gourmet and express (minimarket)

formats

Masami Sawato

+ 81 3 4550 9729


suisse.com

Priscilla Tjitra

+62 21 255 37906

[email protected]

31 March 2015


Boston (1% of sales)

The company launched its first flagship store of Hypermart G7 concept in Dec 2014.

The store is very successful, generating over 30% SSG YoY.

In 2015, the company plans to add:

13-15 new Hypermarts plus 10 stores being renovated into G7

4-5 Foodmart and 25-30 Foodmart Express (in Kalimantan).

A format called Smartclub by 4Q15 or 1Q16.

Competitive landscape:

Hypermart - 109 stores - largest market share

Giant - 55 stores - focus on Java and Sumatra

Carrefour - 58 stores - focus on Eastern Indonesia expansion (+15 new stores this

year)

Lotte - 12 stores - focus in Java only

2015 strategies:

Management indicates it will focus on improving margins (target gross margin +10-20 bps

YoY). In the past, promotions have been done across products. Now, it will be more

focused on just 200 regular household baskets.

We have seen the initiatives being successful in 4Q14. For instance, Hypermart used to

offer a lot of promotions on electronics (additional discount for Hi card members) resulting

in thin margins. In 4Q, they reduced electronic promos. Although electronic sales were

impacted significantly, profitability has increased, gross margin reached its peak level. The

strategy of focusing on bottom line rather than top-line growth will continue in 2015.

In 2015, Boston now have separate management from Hypermart. A new director (used to

work in Watson) came in 4Q14 and is looking to improve the stores. Boston expansion will

follow Siloam's hospital footprint too, in addition to Hypermart.

SSG is targeted to be somewhere around 5% this year. This is taking into account impact

from stores temporarily closed for renovation.

NagaCorp (3918.HK)

Speaker: Gerard Chai, VP IR & Corp Finance. Sean Tan, Director, IR

New News: Yes

Tone: Positive

Chinese players only have limited contribution to the revenue now. Naga is planning few

initiatives to attract traffic from China, including Bassaka airline which is set to fly in China

in 3Q and cooperation with CITS (travel agents in China).

NagaWorld targets the lower end VIP players. The new (and first) Macau junkets already

generate rolling chips of US$627mn or 10% of total rolling chips in 2014 (4 months'

operation only). Junkets from Southeast Asia also grew at 81% YoY which was strong.

NagaCorp attracts junkets from other regional markets by an attractive commission rate

given the low tax rate.

Property upgrade and expansion. Naga2 is physically handing over to the company in

3Q16 with issuance of 1.2 bn shares to the founder and is expected to commence

operation in 1Q17E; adding 1000 hotel rooms, which allow it to drive the critical mass. On

the other hand, the company will complete the construction of private terminal by 2H15

(budget capex: US$15-20mn) to enhance the VIP players experience.

Isis Wong

+ 852 2101 7109

isis.wong@credit-

suisse.com

31 March 2015


Russia project update. The development plan and gaming licenses are pending approvals

from the authorities and may break ground by this summer. Phase 1 has budget capex

US$100-120 mn (commitment under the investment agreement is US$350 mn) with 100+

gaming tables and 500 EGMs and total 346 hotel suites. The company plans to fund it by

internal funding and debt financing.

Neptune Orient Lines (NEPS.SI)

Speaker: Au Kah Soon (Manager, IR), Sylvia Lee (IR)

New News: None

Tone: Positive

Key trades. >11,000 TEUs vessels have to deployed on Asia-EU and >50% of all vessels

delivering this year are 13,000 TEU-plus, so overcapacity pressure is most acute there

(source: Annual report). Thinks that low Asia-EU rates as much reflect BAFs being rolled

back as anything else. Idle rates are at their lowest level so little danger of latent capacity

coming back and low rates preventing any increase in vessel speed. Also think that

alliances have bought some stability on A-EU and reduced rates volatility. While the

structure of rate management has changed (they ebb more rapidly than in the past) GRIs

(general rate increases) are also re-introduced more quickly. Alliances seem to be

managing capacity more ably, which has limited losses on Asia-EU. 66% of Transpacific

business is on a one-year contract, with Asia-EU ~30% also contracted for a year.

Management echoed industry expectations of a rate rise on Transpacific for the 2015/6

contract season.

Fleet. NOL will own two-thirds of the fleet by year end, as 19 charters expire in 2015. Sale

of APLL proceeds are being applied against debt rather than re-ordering, although could

expect some orders in 2016 as next year NOL gets chartered out capacity back from G6

partner Mitsui OSK that will provide some growth. Capacity today stands at 570,000 TEU,

down 5% from 2014 and will likely shrink again this year.

Cost savings. According to their annual report: 70-80% is floating rate bunker clause.

Every change 1% change in bunker price = US$12.9 mn change in EBIT. Bunker

adjustment factor is adjusted every quarter and NOL carries ~two months of inventory,

which is accounted for on a FIFO basis, meaning that bunker benefits are lagged.

According to management: Lower bunker consumption and costs should combine with

land-side savings stemming from the growing scale of the G6 and its improving integration.

The 19 charter expiries in 2015 are 4-5,000 TEU vessels, which are being replaced with

more efficient larger vessels or could be re-chartered at lower rates.

Restructuring. Management's focus has been to build a better business model, with

greater focus on the liner side in terms of cost reduction. It has also focused on

appropriately sizing the balance sheet (target 1:1 debt:equity) and has plenty of liquidity

available to support investment if required. Management aims to pay a dividend as soon

as business can support it.

NetEase (NTES.OQ)

Speaker: Onward Choi, CFO

New News: None

Tone: Positive

Online gaming biz has trended well since 1Q. Blizzard's games, WoW and Hearthstone,

continued to gain good traction thanks to the expansion packs launched in 2H14

Timothy Ross

+ 65 6212 3337


suisse.com

Jialong Shi

+ 852 2101 7347

jialong.shi@credit-

suisse.com

31 March 2015


Lottery biz contributed 5-6% of NetEase's total rev and slightly lower (4-5%) of its earnings.

Lottery biz has been suspended since Mar 1 as a response to government's call for self-

inspection. There is no visibility when this suspension may end. But the CFO does not

believe the authority will ban this online lottery biz permanently.

The company's mobile game pipeline is very strong this year. The CFO advised investors

to watch out for the upcoming title, FWJ, which is adapted from it PC blockbuster title and

will soon kick off official launch. Mobile games margin is lower than its PC games' currently.

NetEase does not capitalise the mobile game development costs which means when the

pipeline games (roughly 20 for this year) are launched and begin to generate revenue

stream, their margin impact would be positive.

Nine Dragon Paper (2689.HK)

Speaker: Benjamin Ng (Deputy GM), Dannis Lee (IR Executive)

New News: Yes

Tone: Positive

ND Paper has started the price hike since early March for some factories, especially in

Dongguan area, ranging from Rmb20-50/t. The final impact will be observed by end of

April. Management team is more positive on this price hike than the unsuccessful attempt

in 4Q2014 as current inventory is lower compared to the industry level.

Demand: The demand is gradually declining in terms of weight mainly due to the

lightening trend since three years ago. The slowdown in traditional retail products is mostly

offset by surging online retail business.

Supply: Positive as new capacity growing has peaked and closures are getting more

aggressive. Government's closure target has been raised from 10kt a few years ago to the

current 100kt. ND Paper expects the gross new capacity in China to be approximately 3

mn t, down from the peak level of 8 mn t in 2013A.

Current debt structure is 30% Rmb and 70% foreign currency (mostly US$). NDP is happy

with the mix but may slightly increase the Euro stake in debt, to no more than 10% of total,

from the current USD debt.

The source of waste paper, the major raw materials, is different from one market to the

other. NDP is using 30% domestic OCC in Dongguan plants, 60-80% in Chongqing and

100% in the new Leshan plant. The price outlook for both domestic and overseas OCC is

a declining trend.

NYK (9101.T)

Speaker: Noriko Miyamoto (GM), Toru Maruyama (Deputy GM)

New News: 4Q FY 3/15 operational guidance

Tone: Positive

Container - Transpacific volumes down 10%, with backhaul especially hit by USW

congestion that will also add US$10 mn in expense to 4Q FY 3/15, however this is being

balanced by a rise in rates due to low vessel idle rate. On NYK's scale, its US rate was

100 vs 91 last year in March and averaged 95/96 for 4Q. Cargo is split 70:30

USWC/USEC with the USEC rates even higher. NYK expects alliances to continue

contributing to ongoing congestion as 2015's peak returns. A GRI (general rate increase)

is timed for 1 April for Transpacific, but Asia-EU remains very tough and the industry

postponed its March 15 GRI to 1 April. LNYK's own performance sees vessel utilisation in

the mid-80s and its 4Q index is holding around 68, so EU still under pressure. T/Pac rates

expected to be higher and bunker is down so a good year in 2015. 70% of bunker is

Owen Liang

+852 2101 6093

owen.liang@credit-

suisse.com

Timothy Ross

+ 65 6212 3337


suisse.com

31 March 2015


hedged by financial hedges and surcharges, with financial hedges accounting for about

10-15% of total requirements. On balance, container is performing in line with expectations.

Dry bulk - few places to hide, but have some FFAs previously taken out at high rates that

provide some protection. Capesize and panamax at 70-80% covered by long-term

contracts, with only 30 capes and 20 panamax on spot. NYK has returned five high cost

inward charters so saving some expenses in 4Q, but falling short of target as a result of

low spot rates. Car carriage is doing well, but 29/31 VLCCs on contract and some of these

contracts are actually loss-making so tanker division is not benefitting from the run up in

rates and has fewer areas of potential cost savings given the pass-through nature of the

business. Management expects car carriage volumes to be flat, but Japan-originating

volumes have risen because of growth from NYK's key customers. 4Q and FY 3/16

earnings should be flattish because of the return of the five capesizes, which represented

annual losses of >Y2bn.

Increasing USD costs base to more naturally hedge the business, which is why macro

factors have fallen in terms of impact. Costs >80% and revenues >90% in USD now.

Air cargo and logistics - USWC labour situation has been benefitting air cargo, which will

again be buoyed in 4Q FY 3/15 by port congestion. Volume growth has been driven by

both forex and demand from a resurgent US economy. Of its 18 aircraft, ten are older

B744Fs and eight new B748Fs; it's leasing out five of the old aircraft to foreign players to

cut costs and capacity. In terms of verticals that are supporting both airfreight and logistics,

auto parts demand is very strong, as is medical equipment and machinery; with the Apple

watch shipping from April expected to keep revenues running strongly as it absorbs

capacity. Getting good back haul volumes because of the USWC congestions (french

fries for McDonald's, for instance).

Cruises - selling two ships to Genting and will only retain one vessel. Will keep this for the

time being as it is Japanese flagged, crewed and operated locally and is a draw card for

domestic retail Japanese investors in NYK stock.

Orient Overseas International (0316.HK)

Speaker: Stanley Shen (Manager, IR), James Lai (Investor Relations)

New News: None

Tone: Positive

Still oversupplied - consensus expectations compiled by management are for 6.9% net

supply growth in the container shipping industry in 2015 versus demand growth of 5.7%,

with close to 1.9 mm TEUs worth of new vessels delivering this year. While the

Transpacific market is seeing vessels as large as 13,000 TEUs being employed, the

company agreed with industry views including (Clarksons) that most of the large vessels

(which account for >50% of capacity being delivered this year) will be deployed on Asia-

Europe. While this will undoubtedly pressure rates on that lane, it should put less pressure

on transpacific trades, where demand growth should at least match supply.

Energy costs yield a benefit - the company expects there to be some pass through of

the US$300+/tonne decline in bunker prices to shippers. However, 1H 2015 should see

most of the gains captured by ship owners as they will have worked through high priced

inventory (typically 6-8 weeks' worth) and will yet to have been harangued by customers

into sharing the benefits. The company still maintains that it is the competitive environment

not energy costs that sets freight rates, however. According to management, the liner

industry is resisting the temptation to speed up in response to lower bunker costs - in part

because new vessels have been built to sail at lower speeds, but also because of its

economics respond better to rates than to bunker cost. Speeds would more likely pick up if

average rates rose $500/TEU than if bunker stays around US$300/tonne.

Timothy Ross

+ 65 6212 3337


suisse.com

31 March 2015


Alliances still evolving - OOIL made unit cost savings across all line items except cargo-

related (landslide expenses, port and canal dues, trucking etc.) expense in 2014, with

much of the improvements coming from G6 alliance membership. This has evolved from

its initial slot sharing relationship into much more integrated data sharing and common

cost control. Alliances have also been instrumental in shaping large vessel orders, one of

which OOIL is actively contemplating and could potentially feature four 20,000 TEU

vessels to compliment the six ordered by G6 alliance partner, Mitsui OSK Lines.

Much more optimistic about 2015 than 2014 – OOIL is the most profitable of those liner

companies that have reported 2014 results, earning a reported NPAT of US$270 mn.

While providing no guidance, the company remains even more upbeat about 2015, with

efficiency gains continuing to flow from alliances and large vessels, less, costly congestion

anticipated, lower bunker costs and better volume growth all expected to buoy earnings.

OSIM International (OSIL.SI)

Speaker: Peter Lee, CFO

New News: Yes

Tone: Mixed

OSIM to launch a new US$5k chair next month.

Also looking to launch a new chair brand exclusively online in China.

TWG store expansion plans on track – 15-20 new stores in 2015.

Overall business momentum still slow – 1H top-line growth likely to remain weak. But

expect a rebound in 2H also driven by new chair launch in April.

PTT (PTT.BK)

Speaker: Mr. Phichin Aphiwantanaporn, Vice President - Investor Relations

Department. Ms. Kanyamas Rithidej, Senior Financial Officer. Mr.

Chaiyanant Sekanandana, Financial Officer

New News: Yes

Tone: Positive

Expects Bt30 bn from sales of two refineries. PTT expects to raise around Bt30 bn from

the sell down of its stake in Bangchak in 2Q15 and IPO of SPRC in 3Q15. The listing of its

power affiliate, GPSC, will see capital injected into GPSC but not existing shareholders.

Further capex cut. PTT group is planning to cut its capex further. Details were not provided

but will soon be given to the SET. PTTEP intends to further cut its 2015 capex plan by

10%. For PTT, half of its five-year capex plan is due to be spent on infrastructure projects

including LNG terminals and pipelines.

Qihoo (QIHU.N)

Speaker: Qihoo CFO , Alex Xu

New News: None

Tone: Positive

Solid top-line growth in 2015 driven by search and mobile app store. The CFO thinks the

current consensus forecast of ~US$700 mn in FY15 search revenue (up 135% YoY) is

very conservative. He guided for 70% growth for its mobile gaming revenue this year.

Anand Swaminathan

+65 6212 3012

anand.swaminathan@credit

-suisse.com

Poom (Paworamon

Suvarnatemee, CFA)

+ 66 2 614 6210

paworamon.suvarnatemee

@credit-suisse.com

Jialong Shi

+ 852 2101 7437

jialong.shi@credit-

suisse.com

31 March 2015


Mobile search traffic share already reached 7% by end-14, which the CFO expects to

increase to 15%-20% by end-2015 and to 30% by end next year (2016). Primary focus of

mobile search this year is to grab users.

Margins will likely improve in 2015 backed by leverage on R&D and marketing expenses.

Qihoo's headcount had already reached 6,000 or so by end-2014. According to the CFO,

the headcount increase will be very limited this year. Even taking into account a potential

pay rise, the overall R&D expense should be growing slower than the street's forecast top-

line growth of 50% plus in 2015. Also, the growth of sales and marketing expense will also

be slower than the topline due to a considerable cutback on pre-installation spending,

according to the CFO.

The Coolpad JV has been progressing well. The first phone from the JV will likely be

released around July 2015. The rationale to go into hardware is because hardware is

closer to end users on mobile than software and thus provides stronger control of user

traffic. Qihoo was not alone in this move as Alibaba has also invested in another Chinese

smartphone maker called Meizu, according to Qihoo's CFO. This JV will have little impact

on margins as Qihoo is a minority shareholder. CFO estimates the JV to break even on an

operating level in FY15.

RHB Capital (RHBC.KL)

Speaker: Khairussaleh Ramli, Deputy Group MD

New News: None

Tone: Positive

Management is still optimistic on prospects of raising group ROE to >14% by 2017 (from

11.5% in 2014).

Key focus is to reduce the cost-to-income ratio to <51% in 2015 (from 55% in 2014).

Management is comfortable with asset quality and is confident of full recovery of its loans

to 1MDB (apparently fully secured).

Management is still exploring options to enhance CET 1 ratio of 9.8% and plans to make

an announcement soon.

Robinsons Land Corp (RLC.PS)

Speaker: Mara Utzurrum (Head IR), K. De Leon (Business Unit Controller)

New News: None

Tone: Positive

Focus is still on recurring income: RLC will stay true to its business model as they

invest more on growing their Malls, Office, and Hotels portfolio. All three business divisions

combined account for 65% of RLC's total revenues, 83% of EBITDA, and 77% of EBIT.

FY14 was their most aggressive expansion phase – Office GLA growing by 42% YoY ,

Malls GLA by 16% YoY, and Hotel rooms rising 17% YoY.

Not too excited about Residential, but upside surprise is noteworthy: Coming off 8%

YoY growth last year, management guides for a flat sales take-up growth in FY15 as they

look to launch at least P6.0 bn worth of new residential inventory. Nevertheless, upside to

their sales take-up expectation can be boosted by their plan to relaunch their first high-end

residential project since 2009, which has an additional sales value of P6.0bn. RLC has

four residential brands – Luxuria (high-end, high-rise condos in very prime locations),

Robinsons Residences (high-to-mid, 30-50 storey residential condos in major CBDs),

Robinsons Communities (low-to-mid, 10-30 storey at periphery of CBDs and suburban

Danny Goh

+ 60 3 2723 2083

danny.goh@credit-

suisse.com

Danielo Picache

+63 2 858 7758

danielo.picache@credit-

suisse.com

31 March 2015


locations), Robinsons Homes (lots and house+lots packages mostly in urban cities outside

of Metro Manila).

Office and Malls and GLA expansion targets on track: RLC looks forward to next year

as they are on schedule to complete its next office building, Tera Tower in Bridgetown

Business Park in Metro Manila, by 1Q16, which will result in an FY16 office GLA growth of

13% YoY. For Malls, 1 new mall in Metro Manila already opened in 1Q153, and two more

new ones will operate this year in provincial locations. Including an expansion of another

Metro Manila mall, total mall GLA growth this year will be 10% YoY. Occupancy rates of

existing buildings are robust at 95% for Malls and 99% for Offices.

All-time high capex at P17 bn mostly for construction completion: Roughly 66% is

allocated for Malls/Office/Hotels project completion and 22% for Residential. The

remainder is for land banking to replenish existing land bank of 562 hectares, which is

developable in four years. This spending will be financed mostly by debt, wherein they

recently offered P10-12 bn 7-10 yr bonds for 4.8-4.93% p.a fixed interest. Despite

aggressive capex plans, they want to stick to their historical cash dividend of P0.36/sh, or

roughly 33% payout ratio, which is one of the highest in the sector.

Sa Sa (0178.HK)

Speaker: Guy Look, CFO & ED; Tiffany Cheung, Director of Corporate

Communications & Investor Relations

New News: Yes

Tone: Negative

The operation in March was generally weak in both (1) traditional tourist attractions like

CWB, TST and (2) residential areas such as new territory that recorded a small decline in

sales (which actually saw meaningful growth in the past months before the protests in

Tuen Mun etc). Management previously planned to expand in residential areas, but now

hold a wait-and-see view.

Competition in HK is intensified, with pure Korean cosmetic players being the largest

competitor in managements' view. Given their (1) product innovation and quick new

product launch, (2) pricing competitiveness, and (3) tilted presence in residential areas

rather than tourist attractions due to rental affordability, they are positioned to capture

higher growth than Sa Sa.

Management believes that the extent of overlap in customers between E-commerce in

China and Sa Sa is not that high, given that the average ticket size in Sa Sa online/offline

stores is more than twice of that in E-commerce players like Jumei.

The operation in China is improving YoY in FY3/15. Despite weak sales growth, (1) the

boutique store format and (2) concentration of stores in Southern China cluster proved

effective in cost control and thus improve the profitability. In FY3/16, management

expects to open 20 stores in China (net), with more stringent conditions to better control

the failure rate. The company will also improve its product mix to introduce new products,

which hopefully can drive the sales growth in FY3/16.

Management saw a stable rental/sales ratio in FY3/15 up to Feb. They believe their rental

and labour cost should be under control.

Eva Wang

+852 2101 7365

eva.wang@credit-

suisse.com

31 March 2015


Samsung C&T (000830.KS)

Speaker: Ms. You-Jung Lee, Senior IR

New News: None

Tone: Positive

Samsung C&T indicates no other problematic (or cost overrunning) projects after

completion of Qurayyah IPP project in Saudi Arabia, which had incurred non-op

provisioning of about W160 bn in 4Q14, in Feb 2015. In particular, management continues

to guide a high-single-digit GP margin for the Roy Hill project in Australia with total project

vale of w5.4 tn, which has been completed 79% as of Feb 2015 and would be fully

completed by end-2015. This implies an increase of pre-tax profit by at least W200 bn YoY

in 2015, considering there was additional one-off provisioning of about W100 bn from a

domestic housing project in 4Q14 besides the W160 bn from Qurayyah IPP project.

Management also remains upbeat about its new order guidance of w15.7 tn (overseas:

W10.3 tn) vs W13.1 tn (overseas: W8.0 tn) in 2014. It indicates several overseas (mainly

skyscraper and infrastructure projects in terms of segment and Asia/ME in terms of

geography) and domestic plant projects have already been virtually secured.

Revenue trend for trading division, which has seen revenue decrease for two years in a

row that is a result of management's focus strategy on selective profitable items.

Samsung C&T expects increase of its trading revenues in 2015 as it has already

squeezed its trading items enough over the past couple of years. It expects its trading op

margin to stay stable in 2015 vs 0.6% in 2014.

Sembcorp Industries (SCIL.SI)

Speaker: KOH Chiap Khiong, CFO. NG Lay San, Group Corporate Relations

New News: None

Tone: Mixed

Phase 1 of TPCIL plant in India (660 MW) achieved COD in 1Q15, while phase 2 (660

MW) is expected to achieve COD in 3Q15. They have secured power purchase

agreements totalling 900 MW to date, comprising mainly of medium and long-term

contracts. Supply of domestic coal from Coal India has been met so far; while

management believes a lower-than-expected load factor is key risk to achieving its return

target.

In Singapore, management does not expect a sharp recovery in the power market in the

next one to two years due to overcapacity issues and gas offtake agreements. The key

risk to Singapore Utilities profitability would be lower power spreads as retail contracts are

renegotiated.

Management remains confident of achieving Vision 10/10, which aims to grow its total

Energy portfolio to 10,000 MW and water portfolio to 10 million cubic metres per day by

the end of 2015. Key growth markets that the company is targeting include India, China

and ASEAN (Indonesia and Myanmar).

In Marine, management believes orders are likely to be supported by demand for

production units and ship repair. While payment for Sete Brasil has been delayed since

November 2014, management is cautiously optimistic current challenges will be resolved

with financing focused on the yards that are able to deliver.

Sinn MinSeok

+82 2 3707 8898

minseok.sinn@credit-

suisse.com

Gerald Wong

+65 6212 3037

gerald.wong@credit-

suisse.com

31 March 2015


Showa Denko (4004.T)

Speaker: Takanori Tanuma, IR Office, Tomoko Yazaki, Manager, IR Office

New News: Medium-term strategy for core business

Tone: Neutral

1Q FY 12/15 OP: 1H company OP forecast is Y10 bn but initial forecast breakdown seems

to be Y3 bn in 1Q and Y7 bn in 2Q due to maintenance shut down in 1Q. So, 1Q looks

weak but in line with company forecast.

Petrochemicals are better due to lower naphtha prices. Hard disks media shipments

will be weaker than expected (18mn units per month against 19mn at forecast), according

to management, with graphite electrode in line. Volume growth is firm but price increase is

limited. Margin will be firm, according to management, given lower raw material cost

although product price increase will be limited.

Medium-term strategy: The company will focus on two core businesses; HD (Hard Disk

media) and GE (Graphite Electrode). Management expects demand increase for large

capacity HD. The company has leading technologies for next generation HD

manufacturing. GE demand and supply will be improving towards 2016.

Shriram Transport Finance (SRTR.BO)

Speaker: Mr Umesh Revankar, CEO

New News: None

Tone: Positive

Management is encouraged by positive policy action in recent weeks, including passing of

key legislation, positive budget takeaways, lifting of mining bans in a few states etc. The

impact of recent unseasonal rains should be limited.

Disbursement levels have held up well, and management believes loan growth of 10-15%

is achievable near term. The company is stepping up hiring to prepare for the increased

business.

Freight rates have behaved well over the past few weeks, rising when diesel prices went

up ( the behaviour over the last few years has been of freight rates staying flat while diesel

prices kept moving up). Overall resale values are holding up well, after having declined for

a few years.

Management expects gradual improvement in NIM to continue, as yields stay steady with

falling funding costs. While demand for securitisation has been slow this year,

management expects demand to return over the near term.

SK Hynix (000660.KS)

Speaker: Mr. Sung Keun Cha, Vice President, Head of Investor Relations

New News: None

Tone: Positive

DRAM Pricing. PC DRAM prices still weak but symptom of normal seasonality. Seeing

much stronger prices out of mobile and server DRAMs.

Do not think PC DRAM weakness will persist for a long time. There are lots of wafer

shifts occurring toward mobile. Mobile demand should pick up strongly from 2Q15. Thinks

Samsung GS6 demand will be strong with shift to 3GB additionally helping. Strong

indication AAPL shifts to 2GB on next iPhone. Not concerned about demand this year.

Masami Sawato

+ 81 3 4550 9729


suisse.com

Sunil Tirumalai

+91 22 6777 3714

sunil.tirumalai@credit-

suisse.com

Keon Han

+82 2 3707 3740

keon.han@credit-

suisse.com

31 March 2015


Clarification on capex and capacity. Nothing has changed from the initial

announcement despite the industry chatter. Hynix cannot pull in M14 because physically

the building won't be completed until June. Can confirm 15k of buffer wafer into M14 in

4Q15. Equipment move in from M10 will be slow and will take place during 2016. Total

wafer capacity will remain 260k to 270k wpm by 2015 end so same as 2014 end.

For the current M14 preparation, the entire clean room space is for relocation of

M10 equipment which will be 130k wpm maximum. Upper floor can be used in the

future, but no clean room is being built near term. Technology: 21nm wafer input will begin

in 2Q15 with 30% of total production expected on 21nm by end of 2015. Most of 21 nm

this year will be for PC DRAMs with LP DDR4 starting in early 2016. For the mobile DRAM

segment, LP DDR4 should be 20% of mobile demand this year. Currently, about half of all

bits produced is on 29nm, the other half on 25nm.

For NAND, 16nm TLC is due to start in 2Q15. Majority of this year's 50% bit growth will

be from TLC transition. For 3D NAND, 24 layer TLC has been developed. 36 layer

development will be done in 2H15. the company is providing samples to customers but will

not go into mass production. 48 layer is due to be developed in 2016 and only then will the

company go into mass production for 3D NAND.

Inventory. PC DRAM producers only have one week's inventory. PC makers' inventory is

about four to five weeks. Channel could be up to eight weeks. It is tough to say what is

normal for PC DRAMs these days as the channel is not very large anymore. Mobile

demand pick-up is expected be strong so wafer shift should be strong. There is a risk of a

PC dram wafer shortage later this year although PC DRAM demand is currently weak.

S-Oil (010950.KS)

Speaker: Gwang-Cheol Ko, Head of IR

New News: None

Tone: Neutral

2015 outlook (refining): 1Q has been quite positive so far for refining margins, with strong

demand picking up from gasoline and naphtha especially. Management expected that 2Q

demand may see a slight downward adjustment due to seasonality, but remained positive

on the outlook for S/D in 2015, with demand growth (~1-1.5 million bbl/day) outstripping

supply growth (~1 million bbl/day)

2015 outlook (petrochem and lube): Management expected the petchem and lube

segments to be similar to last year, with the petchem segment affected adversely by the

new PX supply glut coming online since last year (maybe it will take a few years to absorb

the new supply)

Management's view on new shareholder: Management remains optimistic on the long-term

impact with Saudi Aramaco taking 63% stake in the company, amid more transparent

management and stronger financial support

New petchem plant: The new petrochemical project (awaiting BoD approval) involves a

total investment of US$3 bn (over the next three years), and aims to come online in 2017.

Using pure oil as feedstock, product mix of S-Oil is expected to change to 50%/13%/37%

for PX/Benzene/Propylene starting from 2018 (after start-up of new plant) as opposed to

current mix of 70%/21%/9%. Cash cost level should be similar to the Middle East PDH

players

Kenneth Whee

+852 2101 7319

kenneth.whee@credit-

suisse.com

31 March 2015


SJM (0880.HK)

Speaker: Mr. Robert Mcbain CFO

New News: None

Tone: Neutral

The company believes that Macau is suffering from the collateral damage of the China

anti-corruption measures. This is the same case as the slowdown of the luxury goods and

high-end spending in China. The slowdown is not because China wants to target Macau.

New casinos supply should help to drive certain demand. However, it sees a bigger impact

when Macau Studio City (standalone project) opens with new compelling new facilities and

attraction. The new supply of hotel rooms should help also.

In terms of both demand and cost sides.

For the new casino project, the age of high return is likely to be gone. Going forward,

management sees a 20% return a more reasonable expectation. For SJM, major capex

will only come in 2016, near term no urgent financing needs. New project (Lisboa Palace)

is on schedule for 4Q17 opening.

SJM sees opportunities in better table utilisation especially for the franchise casinos.

Labour costs should continue to go up due to the relative small work force. SJM is not

replacing staff attrition. SJM expects an 8.5% staff cost increase with a flat headcount

overall. Margins may see some pressure on falling revenue and rising costs.

No change so far for player reinvestment rate for the VIP or premium mass customers.

The company doesn't see irrational price competition for the premium mass segment.

Skyworth Digital (0751.HK)

Speakers: Katherine Chan, Executive Director, Maggie Mak, IR GM

New news: None

Tone: Positive

Skyworth plans to start monetising its smart TV services when the number of smart TV

users reaches 5 mn (currently ~4 mn), which it expects to achieve in 2H CY15. The

monetisation approaches include: (1) content sales sharing with content providers, (2)

gaming sales sharing (cooperators including Tencent Game), (3) advertising on its own

proprietary operating system, and (4) interface of e-commerce platform on TVs.

Skyworth has been steadily gaining market share from its competitors, with total market

share rising to ~20% in 2014, according to the company (management believes third-party

surveys such as AVC underestimated their market share due to their high exposure to

rural areas). Management attributed its unexpected strong volume growth in Feb-15 to its

advantage in self-operated logistics and faster than peers goods delivery. The company

says it will not consider launching a price war to gain additional market share at this stage.

Skyworth's current factory utilisation rate is 70% on average (near full utilisation in peak

season but 50-60% in slack season). Channel inventory is healthy at around three weeks.

Total capex in FY15-16E should be higher than historical at ~HK$2.3 bn each year for the

construction of its AC plant in Shenzhen, according to management. Skyworth has set up

a team of 150 people for the AC business, who joined from Gree with expertise in R&D

and overseas business. The company targets to start with 20% utilisation (0.6 mn sets out

of 3 mn in total in 2015 and gradually ramp up to full production capacity of 3 mn units in

2018. Management says its key competitive advantage for the AC business is Skyworth's

distribution channel and brand name. It expects a GPM of 21-22% and NPM of 5-6% at an

optimal level, if realised.

Kenneth Fong

+ 852 2101 6395

kenneth.kc.fong@credit-

suisse.com

Eva Wang

+ 852 2101 7365

eva.wang@credit-

suisse.com

31 March 2015


SMIC (0981.TW)

Speaker: En-Ling Feng, Director of Investor Relations

New News: Yes

Tone: Positive

Near-term on track. SMIC advises it remains on track to 1Q15 sales guidance for low-mid

single digit growth and 27-29% GMs with some growth in 2Q15, as the company is not

seeing the same slowdown impact from FX that TSMC is seeing at this stage. The

company’s utilisation has increased from 93% in 4Q14 to be now completely full on a

wafer-in basis in 2Q15. The company says it can grow its capacity 8% on an annualised

basis with 10k 8” added in Shenzhen and 3k added in Tianjin. The company plans to

ramp 28nm in Shanghai to have 6k capacity on 28nm this year, with the Beijing JV fab’s

10k WPM capacity ramping either in 4Q15 or 1Q16.

Margins solid in 1H15, some impacts in 2H15 from new 8”/28nm capacity. The

company maintains high GMs in 1H15 with 27-29% in 1Q15 and higher utilisation in

2Q15. As per management, the 2H15 GMs will have some impact from (1) Shanghai

28nm ramp at lower yields, (2) Shenzhen 8” ramp, and (3) Beijing start-up costs – so

important to factor in but a signal of 28nm ramping up for further growth on that large

node.

28nm to have a mild ramp, process improvement still on-going. SMIC targets 28nm

ramp up with Qualcomm from 2Q15 starts and 3Q15 production and has other Chinese

customers following on but advises it would be a couple quarters after the initial

ramp. The company says it still needs to improve yields to get to mass production but

would start from 6k WPM in Shanghai which would contribute up to 10% of sales. Beijing

would start after and ramp through 2016.

Adding capabilities to the mature 12”. SMIC advises it has filled its more mature 12”

capacity with more volume of new applications (set-tops, connectivity, 3G ICs and DTV),

The company has added 55nm embedded flash for smart cards (SIM, transportation, ID,

bank cards) and MCUs. The company says it can also fill its 40nm node with 38nm lower

density NAND flash.

8” nodes full with more specialty process. SMIC is growing volumes on fingerprint

sensors, power management migrating to 0.13 micron, BSI CMOS sensors on 0.13 micron,

bank cards on 0.13 micron as the flash memory is more proven on 8”. Bank cards is

slower than expected by the company as local customers are slow to gain traction against

NXP’s 80% share. As per management, 8” still has opportunity to replace 6”, but MEMs,

sensors, analog and packaging can stay on 8” and capacity is tight due to limited supply of

used equipment although the company did secure some from Intel Israel and Panasonic.

China providing strong support. The National Government fund took 11% equity stake

in SMIC recently as a strategic investment to improve the ecosystem and earn a return on

the equity. The company’s top four holders have 45% stake (Datang 19%, China IC

Industry Investment fund 11%, CIC 10%, Shanghai Industrial 5%). Funding is coming from

(1) R&D grants from the China 5 year plan, (2) National IC fund is motivated by returns

across the portfolio so strengthening SMIC would help the ecosystem so it could invest

through equity and contributions to leading edge technology. The company advises it is

still developing baseline technology on FinFET and planning a separate venture for 14nm

R&D partnering with other local stakeholders.

Randy Abrams

+ 886 2 2715 6366


suisse.com

31 March 2015


SPIL (2325.TW)

Speaker: Janet Chen, Director of Investor Relations

New News: Yes

Tone: Positive

Results on track. SPIL is tracking well relative to guidance for sales, down 1-6% QoQ

and GMs 24-26% and OP at 14-16%. The company is still seeing a nice recovery in

March-May due to handset (4G handset and China infrastructure) and TV picking up with

PCs flat. The company believes flip chip utilisation is improving and bumping capacity is

tight due to China, US and Taiwan baseband growth for bump and flip chip. In 1Q15

utilisation on wirebond remains 78-82%, test at 74-78% with flip chip originally guided 78-

82% but is seeing that capacity now grow tight. It is still too early for them to quantify the

2Q15 revenue growth but at this stage growth looks reasonably good.

Margins holding up. The company is still getting 45% GM leverage with each incremental

1% gain on sales. The company views demand as solid with utilisation at high levels to

keep pricing stable and in line with cost down activity. Margins are 30%+ on advanced

capacity, so is giving a lift as advanced capacity runs faster. The company does only high-

end test but stays out of low end and memory/analog.

Capex plan. The company’s capex plan remains NT$14.5 bn (vs. NT$19.5 bn in 2014 -

NT$15 bn equipment + NT$4.5 bn Promos fab purchase) will have 80% for 8/12” bumping,

FC CSP, WL CSP and high-end testing to grow capacity 20-30% on advanced

capacity. Wirebond capacity additions remain very limited. The company is adding a flip

chip line in Suzhou this year and will add bumping next year (Suzhou now 10% of

consolidated sales). The company’s new facility purchased from Promos will be targeted

for advanced capacity development starting with bumping, WL CSP, testing and potentially

2.5D/3D packaging in the future. The flip chip will still stay outside in Taichung.

Devoting some resources to fan-out packaging. The company is putting more

resources in fan-out WLP to gain opportunities as more IC design houses develop it in

2017. It believes costs are higher as material cost is lower but the process cost is much

higher but has an advantage on performance and shrinkage.

SiP opportunity. SPIL currently does a number of high IC value integration in modules vs.

board level SiP (with 85% material). The company is putting some resources on board

level SiP now for low volumes China fingerprint sensors and has done Wifi module and

antenna for US customers. The company wants some resources to have experience if the

market ramps further.

Stella (1836.HK)

Speaker: Olivia Wang (IR)

New News: None

Tone: Positive

Strategy focus:

Decent volume growth - double digit growth due to customer order. Expect to see a strong

1Q15.

Flattish or negative ASP growth.

10-15 bp of EBIT margin expansion by higher efficiency from higher utilisation rate.

Inventory level is building up due to retailers' cautiousness of end demand.

Expect Stella's strong R&D, OEM quality, and cash management to sustain the

challenging times and remain resilient when market consolidates.

Randy Abrams

+ 886 2 2715 6366


suisse.com

Sophie Chiu

+ 852 2101 7657

sophie.chiu@credit-

suisse.com

31 March 2015


Stable dividends yield at 4-5%.

Summarecon Agung (SMRA.JK)

Speaker: Michael Yong (CFO); Jemmy Kusnadi (Head of IR)

New News: None

Tone: Neutral

A lot of noises on the property luxury tax, but don't think the threshold for the 5% super

luxury tax is going to be changed

Indonesia real estate association is lobbying the govt for progressive tax mechanism,

which would minimise impact on the sector

1-2-3 rule has been there since a few years ago but the implementation depends on the

local government. The government would provide the land and SMRA to construct the low

cost housings

Noises about imposing 10% VAT on individuals who rent apartments, management thinks

that this is hard to be implemented as tracking will be difficult

Govt has allocated the Rawa Bebek area (Jakarta) for SMRA to build low cost housings,

but the Serpong and Bekasi governments haven't dealt with this yet.

Due to the new mortgage disbursement regulation (implemented Sep-13), SMRA is now

around 20% or less ahead in terms of cash flows, compared to 40% before the regulation

came out

To mitigate this, SMRA plans to slow down its land acquisitions and also defer payments

to land owners

Targets Rp5.5 tn presales for FY15, have achieved Rp1.2 tn in the first two months of the

year

Targets Rp1 tn of land acquisition (260Ha) for this year; just acquired 150Ha (~Rp310 bn)

in Makassar a few weeks ago

IDR weakness has no significant impact for the margins, as it only impacts the

machineries and equipment for apartment constructions

Planning to issue Rp300 bn bonds to finance part of capex (leftover from Rp2 tn bond

facility issued in 2013). Currently, average borrowing cost around 10.6%

No issue with land license and development rights in Bandung township, the delay (from

April to May) was due to some pending construction licenses (IMB) for the three show

units and one marketing gallery in the area.

To see a higher plot ratio for the Kelapa Gading area (to be granted by Jakarta's governor)

as the government's LRT project is going to pass through that area

In the next five years, plans to increase NLA of Kelapa Gading mall by 60,000sqm,

Serpong mall by 30,000sqm and Bekasi mall by 50,000sqm. Bandung mall to be opened

in 2018 in tandem with the Asian games

Currently net gearing level is ~40%, comfortable level is below 50%

Planning to list its investment property subsidiary, which owns the malls and assets of the

company. The SMRA company is to focus on the property side

Bernard Kie

+ 62 21 255 37902

bernard.kie@credit-

suisse.com

31 March 2015


TAL (TAL.N)

Speaker: Rong Luo, CFO

New News: None

Tone: Positive

Confident to maintain 30-35% top-line growth for the next few years for its offline tutoring

business. For offline small classes, 60% of revenue was contributed by elementary school

students, 30% from junior middle school and the rest from senior high school

Excluding online investments, operating margin for offline classes will likely expand by 1 to

1.5 pp every year. Taking into account of the online investments, the operating margin for

FY16 will likely be in the range of 18-20%.

The growth in offline classes will be mainly driven by capacity increase in existing cities

and to a less extent by addition of new cities. The ASP is expected to increase by 3-5%

every year for offline course.

Tata Consultancy Services (TCS.BO)

Speaker: Rajesh Gopinathan, CFO

New News: None

Tone: Neutral

Growth momentum: FY15 has been good with mid-teens growth, and the company

continues to think that mid-teens growth can continue. There are no signs of any breakout

on either side for the near term. In terms of segments that have seen relative weakness,

retail was soft in 3Q due to seasonal issues – it is expected to recover. Energy could

remain weak for some time. Historically, TCS has not done well in this sector as the cost

proposition was never a driving factor for customers. In the next phase, this could change

for customers and that could help offshore companies. Telecom could remain challenged.

Europe remains strong, FY15 growth rates should be sustained. IT budgets remain

optimistic but similar to last year – there are no negative triggers.

No shift in competitive dynamics: Management does not see any pricing weakness due

to competitive dynamics. The problems with some of the peers in any case had nothing to

do with pricing.

The impact of cloud: Currently, it is a tailwind as TCS and others are gaining from

incumbents. This could change once the market share gains versus incumbents peter out,

but that's still quite some time away.

On automation: TCS has been leveraging tools for quite some time and this is a key

reason for the margin differentials relative to peers. But the amount of automation cannot

be extrapolated too far. The most automation is possible in infrastructure management.

Captives are not a threat: There was a phase when many captives were set up and they

were subsequently sold off. There is somewhat of a new wave but this could likely go the

same way.

The Mitsubishi JV in Japan is progressing well: Critical top personnel are in place.

There are green shoots in terms of customer response. An offshore location in Pune will

cater exclusively to Japanese customers. The college recruits identified for this venture

are being offered the option of studying in Japan. Having said that, this will be a slow

process.

Jialong Shi

+852 2101 7437

jialong.shi@credit-

suisse.com

Anantha Narayan

+91 22 6777 3730

anantha.narayan@credit-

suisse.com

31 March 2015


TCL (000100.SZ)

Speaker: Jin Wang, Vice Director of IR, Shimeng Liang, Capital Management

New News: None

Tone: Neutral

Management sees great potential in smart TV platform as (1) the leaders such as BAT

have entered the market and collaborate with traditional TV manufacturers; (2) the profit-

sharing model is developing and maturing; and (3) smart TV can also work as a good

entry point for smart home and even community.

The company will develop its smart TV platform in fields such as (1) profit sharing from

advertisement in content providers, e.g., Tencent, Iqiyi and Mango TV, (2) TV gaming

whose market value management believes should reach Rmb70-80 bn in China in the

future, and (3) infomercial development equipped with precision marketing. Management

believes the regulatory risk lies mainly in video clips market and impact more on TV box

rather than TV.

CSOT is the major profit centre for the company. The company expects T2 line to

commence production in Apr 2015 and T3 line in 2017. CSOT will adjust its product

offering and tilt to larger sized products to capture the trend of large TV screens.

Management believes it is doing well in cost control and expects raw material costs to

reduce 5-10% YoY in the coming years.

The new initiatives in the company's smart mobile segment will be focusing on

development in app store and smart wearables, as well as collaborating with Cisco to

develop the cloud tech and system.

Management (Mr. Li Dongsheng and other management members) holds 12-13% of total

shares after the Feb offering, and has become the largest shareholder of the company.

Texhong Textile (2678.HK)

Speaker: Charles Hui, Executive Director

New News: None

Tone: Neutral

Texhong will keep on with its expansion of yarn production. Total yarn production capacity

is expected to grow ~10% YoY in 2016-17E with an estimated capex of Rmb500-600 mn

per year. The company expects its FCF should stay positive on the back of its stable cash

generating capability.

In the long term, Texhong will seek opportunities to expand into downstream businesses,

especially the garment OEM business, by which the company aims to grow its revenue

base more quickly and achieve a stable gross margin. However, no concrete plans have

been set up yet.

On the policy front, the company expects that the domestic cotton policy for the 2015

harvest season will be announced in April. However, NDRC's 10 mn tonne national cotton

reserve remains an overhang for the market and the company.

The company's cotton inventory policy is unchanged at 5-6 months including orders

placed but not delivered.

Eva Wang

+852 2101 7365

eva.wang@credit-

suisse.com

Eva Wang

+852 2101 7365

eva.wang@credit-

suisse.com

31 March 2015


Thai Beverage (TBEV.SI)

Speaker: N. Aungsutornrungsi, IR. T. Kittipong, IR. K. Lapumnuaypon, IR.

New News: None

Tone: Neutral

Stable core: THBEV expects low single digit volume growth for their beer and spirits

segments for the year at best. While the company sees little consumer momentum - which

would have helped on premise sales - they highlight their beer sells at a 5-8% discount to

the market leader. There is potential for some revenue upside through price increases in

the beer segment. The govt. is likely to impose an additional 2% 'sports tax' on excise

duties soon, and is reviewing changing excise calculations from wholesale price to retail

prices.

Focus on non - alcoholic revenue growth: THBEV suggests they are currently not

focused on the bottom line for their non-alcoholic business; instead looking to grow

revenues first. Management hopes to grow sales of 100 Plus in Thailand; targeting about

Bt15 bn in sales of the brand by 2020 (which is equivalent to current non-al sales). THBEV

is positioning 100 Plus as a carbonated soft drink, rather than its traditional isotonic drink

positioning.

Doubling total revenues by 2020: THBEV hopes to double company revenues by 2020;

acquisitions of regional beverage businesses are likely to be a part of the growth strategy.

Geographically, THBEV would like to be focused in Thailand, Malaysia, Singapore and

Vietnam. While THBEV agree that property (they own c.28% of FCL) is not core to their

business, they do not guide as to how (or when) they might exit that investment.

Tokuyama (4043.T)

Speaker: Taro Kobayashi, GM, Corporate Communications & IR Dept.

New News: Yes, focus on financial position improvements

Tone: Neutral

Malaysian phase 1: Malaysian phase 1 plant has written off assets and is currently

spending 2 bn per year development cost to enable production of semiconductor; use

polysilicon in the future. However, if they think productivity will not improve up to a certain

time limit, they may need to covert this facility to produce solar use polysilicon. Conversion

cost of solar use polysilicon equipment may cost 15-20 bn so they really need to consider

carefully.

Malaysian phase 2: Malaysian phase 2 plant current operating rate is around 50-60% and

is expected to improve to full operation from January 2016. The company is aiming for

positive profits in FY3/18 but expects 5 bn operating losses in FY3/16 due to higher

depreciation and limited operation. If that profit forecast will not be able to be achieved, the

company would consider partial asset write-off of phase 2 plant.

Financial position improvement: new president is focusing on improvement of balance

sheet. So, the company may consider possible asset selling and additional cost reduction.

Polysilicon market: spot price will remain 18-19 dollar per kilogram. Demand for solar

use expected to gradually improve towards June-July.

Sanjay Mookim

+ 65 6212 3017

sanjay.mookim@credit-

suisse.com

Kayo Kasanaka

+81 3 4550 9937

kayo.kasanaka@credit-

suisse.com

31 March 2015


Toshiba (6502.T)

Speaker: Mr. Kohei Hayashi - Head of IR Team, Fellow Specialist, Corporate

Communications Division. Mr. Masakatsu Ito - Chief Specialist, IR

Team, Public Relations & IR Office, Corporate Communications

New News: Yes

Tone: Positive

Confidence in NAND OP margin: Toshiba indicated a NAND margin of more than 20% in

4Q FY3/15, which is better than the seasonal pattern. The company explained that the

margin is higher than expected due to demand for high-end smartphones and relatively

stable price trends. For FY3/16, the company is confident on margins due to higher

density growth by Android smartphones, SSD and an increase in 15nm production (lower

cost).

No update on nuclear business: Toshiba did not add to its comments on risks for

additional costs for US nuclear projects. It believes there will not be any additional costs

related to changes in security regulations as the projects are covered by contracts.

Restructuring of Lifestyle division (TV/PC/Home appliances): Toshiba said that it will

restructure its home appliance business (in addition to TV/PC business). The Home

appliance business has been negatively impacted by yen depreciation because domestic

sales account for 80% of revenues but 90% of production is overseas.

Focusing on FCF management: Management has focused on improving FCF, rather than

ROE. It targets to improve FCF from ¥40 bn in FY3/14 to ¥80 bn in FY3/15 and ¥120 bn in

FY3/17.

Tosoh (4042.T)

Speaker: Hisashi Murata, General Manager, Corporate Communications

New News: Yes; measures in FY 2015

Tone: Neutral

Measures in FY3/16 1H, according to management:

Chlor-alkari group: Contributes volume increase through capacity expansion of new plant

which has started from early November 2014. Full contribution from PVC capacity

increase by subsidiary (from Oct 2014) to reflect in 2015.

Polyurethane: Expand high value added polyurethane to cover supply and demand

weakness for regular MDI.

Petrochemicals: Operating rate for naphtha cracker is expected to improve to 95% in

2015 from 90% in 2014 due to good demand environment.

Specialty products: New equipment for biosciences has been introduced and will push

sales. Ethyleneamines demand and supply has been improving.

Hideyuki Maekawa

+ 81 3 4550 9723

hideyuki.maekawa@credit-

suisse.com

Masami Sawato

+ 81 3 4550 9729


suisse.com

31 March 2015


TPK (3673.TW)

Speaker: Freddie Liu, CFO

New News: Yes

Tone: Positive

Increasing Apple exposure in 2H. Apple accounted for 40% of sales in 4Q14 and

management expects it to rise to over 50% in 2H15 given the ramp of Apple Watch and

potential adoption of pressure sensor for iPhone. TPK has entered Apple Watch supply

chain since 4Q14 and is the sole supplier for touch. Management said it sees stable

monthly order and is not experiencing order cuts. It thinks the press report on Apple Watch

component order cut should be referring to the bottleneck at final assembly, and not for

the touch components. It also believes there is a high possibility for the next iPhone to

adopt pressure sensor later this year with TPK/GIS to provide lamination of the sensor

with backlight chassis.

Non-Apple smartphone also seeing good progress. TPK aims to focus on customers

with higher volume and has engaged several smartphone brands such as HTC, Xiaomi,

Asus, Oppo, Meizu, etc. It expects its non-Apple smartphone volume to pick up later this

year, although GM could be around or below corporate average.

Gen 5.5 fab profitability depends on NB and 2-in-1 demand. TPK will start fully booking

the depreciation of Gen 5.5 fab in 2H15, which it will see incremental depreciation cost of

NT$350mn/quarter (~NT$1/share). It thinks the profitability of this new Gen 5.5 fab is

largely depending on NB touch proliferation and 2-in-1 demand. TPK has been working

with MSFT on Surface tablet for several years and thinks the launch of larger size iPad in

late 2015 could further drive the demand for 2-in-1 devices, which will require more OGS

touch and should help to utilise its Gen 5.5 fab.

Capex will be under control for the next few years. TPK spent US$450 mn on capex in

2014 for building Gen 5.5 fab. For 2015, it guided capex to come down significantly to

US$150mn as the spending will be mostly for backend lamination, efficiency improvement,

and maintenance. Management expects limited investment on front-end capacity in the

next few years and believes its operating cash flow to turn positive in 2015.

Fund raising still ongoing. TPK announced intentions to issue US$400 mn ECB and

16.7-20 mn shares of GDR last November. Management said the fund raising is to

improve its balance sheet and prepare for the ECB due in the coming October. TPK has

already received regulatory approval for the fund raising and has extended the issuance

deadline by another three months to end of June. Post this round of fund raising,

management thinks it is less likely for the company to come to the market again in the next

two to three years.

TSMC (2330.TW)

Speaker: Elizabeth Sun, Director of Investor Relations

New News: Yes

Tone: Neutral

Business has slowed, raising customer inventory levels. TSMC has noted a

slowdown in the past 4-5 weeks due to US$ strength impacting European and emerging

market purchasing power. As a result, the company’s near-term demand is being reduced

across multiple nodes and end markets (PC/mobile/tablet/communications). As a result of

lower end demand, it now believes inventory will be a few days above seasonal, exiting

1Q15, so may take some time to work down. It now expects foundry may not grow the

12% it previously expected, but it believes TSMC will still grow a few points above the

industry due to market share gains.

Jerry Su

+ 886 2 2715 6361

[email protected]

Randy Abrams

+ 886 2 2715 6366


suisse.com

31 March 2015


Some impact from the Qualcomm design loss and slower high-end Android – few

hundred million impact on capex. TSMC acknowledges some impact on its 20nm

revenue due to Samsung using its own processor over Qualcomm for the Galaxy S6 and

also weaker high-end Android demand for other global brands. It believes 20nm will still

double YoY (from US$2bn to US$4bn – implying about 13-15% of sales) vs. original target

for 20% of sales. It will now do tool reuse to convert more to 16nm, citing that it has 95%

equipment reuse. The company can save a few hundred million on capex through the

reuse and conversion of 20nm capacity to 16nm.

16nm confidence increasing and scaling up quickly. TSMC believes 16nm will register

revenue starting in 3Q15 and still be a steeper ramp than 20nm (which ramped from <1%

in 2Q15 to 9% in 3Q15 to 21% in 4Q15), with much broader products and applications

ramping in 2016. The company maintains confidence in its comments on 16nm + 20nm:

(1) 16nm share may start out smaller than its competitor just initially due to also doing

20nm first, (2) combined 20nm + 16nm will be much higher than the competition, (3) 16nm

share in 2016 will be much larger, and (4) TSMC will have much larger share than its

competitor in a much larger 16nm market in 2016.

8” demand drivers sustaining for an extended period. The company sees certain 8”

geometries remaining tight for multiple years as a lot of specialty technologies will be

required and will use mature process technology on 0.13/0.15 micron (0.15 micron is the

biggest bottleneck) as 12” carries more design cost. It is adding capacity in China to

satisfy the growing demand, for many applications that it expects would stay on 8”.

10nm to ramp in 2017. The company is seeing good interest and applications for 10nm

but noted the cost is high. Target is 4Q15 risk production with minimum 12 months to high

volume. TSMC believes it is advanced on EUV but still needs to resolve the source power.

The company is planning its 10nm to be without EUV now in its baseline plan of record but

still working toward having a few nodes insertion on critical layers on that node. The 7nm

plan of record needs to be confirmed shortly and is still a swing factor whether it will have

EUV.

Taiwan drought impact inconvenient but not impacting production unless it gets

materially more severe. The company entered a 5% water reduction mode on 26 Feb

and 7.5% reduction mode on 23 March. If the situation does not improve, it would go to a

10% reduction mode starting 1 May. The company has trimmed non-essential uses

(landscaping, fitness) and stepped up recycling of water. It would truck in water if the

reduction mode is raised meaningfully but would not impact its production unless the

situation got materially more severe.

Tsui Wah (1314.HK)

Speaker: Joyce Ma (IR)

New News: Yes

Tone: Positive

2HFY15 update from management:

Store expansion: On track - four new stores by end-March (two in HK; two in Shanghai)

CEO Candidate: A potential candidate secured but no official announcement yet

SSSG: 1-2% in China; 5% in HK

New team in Southern China - can focus on store expansion in Southern China

Strategy focus from management:

Location - Tsui Wah will not sign contract with malls/department stores that has over 30-

40% of F&B area, so as to mitigate competition.

Sophie Chiu

+852 2101 7657

sophie.chiu@credit-

suisse.com

31 March 2015


Smaller store - to open new store at 500-600 sqm in Shanghai (targeted five stores in

FY16)

Labour cost - will increase part-time from current low level of 3-4%

ASP - will increase 2-3% in FY16 (China stores haven't increased ASP for two years)

Marketing - will enhance marketing activity to further promote Tsui Wah brand in China.

Haven't decided which channel though. Will refurbish one to two stores in HK (impact less

than one month revenues)

TUF (TUF.BK)

Speaker: Mr. Wai Yat Paco Lee, Deputy GM - IR and Corporate Investment. Ms.

Suthipa Vacharotayangul, IR Manager

New News: Yes

Tone: Positive

Management feels confidence in closing the US$1.5 bn Bumble Bee deal: The

expected closing date is mid-2H15. Management indicated a lot of ground work has been

done with ongoing communication between lawyers of both parties. The company sees no

major obstacle and, in the worst case, the deal will still go through with a minor asset

disposal. The company still sees a fair competition in the market given that Starkist will still

hold more than 30% share in the tuna.

Synergies expected around US$30mn. The integration of Bumble Bee is expected to

generate a synergy of around US$30 mn through (1) joint sourcing and global

manufacturing network, (2) combining the back end operations - which can be combined

where some cost cutting could be seen right away, (3) some combined orders from third

party OEM suppliers could lead to economies of scale. The synergies would be seen

under both COGS and SG&A lines.

US$400mn expected from equity financing. Management reaffirms that the capital

increase is technically a right offerings in which existing shareholders are given priority to

subscribe the shares. The ex-right is expected around June 2015. The pricing should

provide at least 10% discount in order to attract the subscription.

Near term focus will be the Bumble Bee integration. The company will focus its efforts

on consolidating the Bumble Bee and create synergies in the next few years. Bumble Bee

will be the second major transformation since its TUF acquisition of MW Brand in 2010

where branded product portion and margin were higher after the consolidation.

Management expects a similar process again after the Bumble Bee deal. Bumble Bee has

around US$1 bn in sales and US$140-150 mn in EBITDA.

Tune Insurance (TUNE.KL)

Speaker: Junior Cho, CEO; Yap Wai Yee, IR

New News: None

Tone: Positive

Five key focus / business strategy:

Airasia's growth and leverage on Airasia's platform to sell other insurance products.

Diversifying their dependency on Airasia with new airlines and non-airlines

partnerships - expect at least one (likely 2-3) this year.

Warayut (Yuth)

Luangmettakul

+ 66 2 614 6214


dit-suisse.com

Rachel Tan

+60 3 2723 2081

rachel.lr.tan@credit-

suisse.com

31 March 2015


Digital platform. Management plans to start with travel and subsequently introduce

other insurance products into the digital platform. Management is preparing ahead of

the detariffication of the Malaysian insurance industry and expects a change in

consumer behaviour in 2016.

Leverage in Malaysia and Thailand general insurance to manufacture new insurance

products.

Acquisition - management aims to acquire an Indonesia insurance company in

FY2015.

Management has seen a pick-up in take-up rates post resolving the online booking system

and recovery from the airplane tragedy. Management targets to achieve a take-up rate of

25% or more in FY2015 (FY2014: 23%).

Aims to reduce contribution from Airasia from currently 95% to 85% in the next three to

four years.

Management expects a double-digit growth for both online and TIMB business.

Ultratech / Grasim (ULTC.BO / GRAS.BO)

Speaker: Mr. Adesh Gupta, CFO, Grasim / Mr. Atul Daga, CFO, Ultratech

New News: None

Tone: Positive

Demand outlook – Expect 8% cement demand growth next year with demand

acceleration starting from 2QFY16. Road projects should be the first contributor and then

other investment projects should contribute like smart cities, metro network, rail corridors,

etc.

Positive on margin expansion – (1) expect supply CAGR of 5% over the next three

years and thus incremental D-S is favourable (2) cost savings from higher usage of

petcoke (10% cheaper than local coal) and lower freight costs.

Capacity expansion – Many questions on why Ultratech is still expanding despite

utilisation at 75%. Ultratech will continue to expand organically and look for acquisitions as

structural story is still strong for cement for more than a decade at least.

Limestone mine auctioning – (1) positive for organised players as the mine allotment

process gets simplified and getting possession is much faster, (2) auctions will keep non-

serious players out as auctioning needs an end-use specification.

GST implementation – will be positive as it will enable to supply to end market more

efficiently. Currently a 2% sales tax is involved when supplied from one state to another.

Grasim – VSF near term remains challenging as price of competing fibers like cotton and

polyester is low. In the near term it is not working on increasing FII limit; but in the longer

term this should be addressed.

VGI Global Media (VGI.BK)

Speaker: Khun Marut Arthakaivalvalee, CEO

New News: None


Weak adex in 4QFY15 (Jan-Mar 15) but better outlook in FY16. Management sees last

year adex as being a low base affected by political turbulence, which is unlikely to be

repeated again this year. Given a high correlation between GDP and industry adex, the

Anubhav Aggarwal

+ 91 22 6777 3808

anubhav.aggarwal@credit-

suisse.com

Warayut (Yuth)

Luangmettakul

+ 66 2 614 6214


dit-suisse.com

31 March 2015


management expects better ad spending in FY16 and should be gaining better momentum

in the latter half of the year.

New ad spaces to start contribution from Apr 15. Management expects the new ad

spaces to start contributing from Apr 2015 onward. These new ad spaces include 1,083

Family Mart branches, more ad spaces from BIGC, seven new BTS stations, etc. The total

revenue contribution ranges from Bt140-200 mn with a net margin to be as high as 20-

25%.

Impact from Tesco ad contract to be over in Feb 15. VGI modern trade media losses

was due to a minimum fee payment under Tesco Lotus ad space. It was difficult to sell the

ad spaces during this period. As the contract already expired in Feb 15, the impact from

this should no longer drag the company's performance from 1QFY16 going forward.

Promising long-term outlook in mass transit. Management sees a strong growth

outlook for mass transit-related media. VGI expects to secure more ad spaces as the

Bangkok mass transit network is expanding over the next decade. Mass transit was doing

well with positive ad spending growth and high occupancy rate despite the political

situation last year. Mass transit contributes over 50-60% of the top line and over 70-80%

of the bottom.

Visi Media Asia (VIVA.JK)

Speakers: Anindya Bakrie, CEO. Erick Thohir, CEO PT Intermedia Capital.

Koko Kurniawan, VP Director. Otis Hahijary, Director of Strategic

Planning. David Burke, Director. A. Satyagraha, GM Corp Finance

New News: Not Rated

Tone: Positive

VIVA operates two free-to-air channels in Indonesia (ANTV and TVOne)

ANTV is entertainment channel, female, BC market segment, and around 25 years old. It

has been gaining audience share and it is in the Top three channels.

TVOne is a news channel, which was acquired in 2007 (previously was Lativi), and

changed the profile to BC market segment, instead of only AB market like competitor

MetroTV. It also add the sports content during the weekend.

Focus on "micro targetting" to the business, low cost (70% of production is in-house, thus

can predict the cost by around 10% at max, and it has to produce 12,000 hours). By doing

an in-house, it also gives flexibility of the consumer trend; also provide customers'

experience (interactive, using social media engagements to promote the show)

Audience share has gained 2-3x

Internet portal has US$7 mn revenue

The successful Mahabharata series drama only cost US$3,000 per hour, versus

competitor's local drama of US$40,000 per hour. The company already has 6,000 hours of

show before hiking the price.

In FY14, revenue was up 35% YoY to Rp2.25 tn, with Rp144 bn net profit (+34% YoY),

Operating margin stood at 34%.

Ella Nusantoro

+ 62 21 255 37917

ella.nusantoro@credit-

suisse.com

31 March 2015


Waskita (WSKT.JK)

Speakers: Tunggul Rajagukguk, CFO; Antonius Yulianto, Corporate Secretary;

Shastia Hadiarti, IR

New News: Yes

Tone: Positive

FY15 target: New contract of Rp20.8 tn (FY2014: Rp22.6 tn); Total contract of Rp41.1 tn

(FY14: Rp33.2 tn). Management explained the lower new contract in FY15 target was due

to Rp4 tn of order book were new contracts achieved in FY2013 but was only recognized

in FY2014. Excluding this, management expects 16% growth in new contracts for FY2015.

Corporate actions: 1) Equity injection/rights issue - Government equity injection of Rp3.5tn.

Management expects to raise a total of Rp5.2tn via rights issue with the equity injection.

Management plans to request for another equity injection of Rp3.1tn in FY2017 and to

raise a total of Rp4.7tn via rights issue. 2) IPO - plans to list it's precast unit in FY2016.

The equity injection is earmarked for investment in toll road projects. Management

estimates revenue from toll road could contribute 25% of revenue in the future after the toll

roads are operational.

New on land acquisition: Effective 2015, the government / concession holder can take

possession of the land upon depositing the amount in the court after receiving judgement

from the final court.

Weibo (WB.OQ)

Speaker: Herman Yu, CFO; Eason Zhang, IR

New News: None

Tone: Positive

SME advertising: Weibo’s SME advertising grew 137% YoY in 4Q14, the fastest among

SME/Alibaba/KA supported by its strong ROI. Management highlighted that mobile app

developers have become a key advertiser group due to strong app downloads generated

from promoted feeds.

KA (key account) advertising: Through the Weibo+TV campaign, Weibo has attracted

many brand advertisers, such as Yili, to allocate budgets to it due to the strong social

interaction on brand image on the Weibo platform. Although current ad dollars spent on

Weibo are still limited compared to TV, management thinks there is high potential for more

budget allocation.

Mobile monetisation: Weibo has become a mobile company as 54% of revenue came

from mobile in 4Q14, compared to 28% in 4Q13. Currently, Weibo is competing for mobile

ad dollars with mobile search and video. There is still a limited number of advertisers

allocating a separate budget for social ads in China. Management expects the rise of

WeChat ads to help accelerate the growth of the social advertising market in China.

Westports Bhd (WPRT.KL)

Speaker: Eddie Lee (Head of Commercial)

New News: Yes

Tone: Positive

Transhipment still growing. 70% of throughput is still transhipment, growth coming from

East-West trades and intra-Asian lanes has provided the rump of improvement. WHB

charges the same whether boxes are laden or empty so is indifferent as to whether growth

Rachel Tan

+ 60 3 2723 2081

rachel.lr.tan@credit-

suisse.com

Jialong Shi

+ 852 2101 7437

jialong.shi@credit-

suisse.com

Timothy Ross

+ 65 6212 3337


suisse.com

31 March 2015


is front hail or backhaul. Malaysian GDP growing 5-6% and this is supporting gateway

growth, which is also growing at double-digit rates, but slightly lagging transhipment

volumes.

Competing hubs. Jakarta is investing more to expand but is too far away from main trade

lanes to compete for hub traffic. There has been some discussion of another port in

Sumatra, but location and facilities are not obvious and it would lack any gateway traffic to

cornerstone flows. Given its need to discount relative to WHB to attract business, any new

facility would never be able to make the numbers work. All major transhipment hubs (PSA,

PTP and WHB) are adding capacity as they are approaching congested levels.

Congestion occurs for WHB mostly because the vessel doesn't arrive in its "window", with

75% of vessels arriving out of window. It is working on increasing crane efficiency to cope

with this, but doesn't have the same landside constraints that many other hub ports have

in terms of marshalling areas that impact storage capacity.

Tariffs - have been pushing for an increase (first in 13 years) for 18 months. Port Klang

Authority (the local regulator) has given its permission and it is now waiting on the Ministry

of Transport. WHB has requested a 50% increase, but expects this to be cut back. WHB

asked for a 50% increase two years ago for the conventional business and received 20%

so expects the same for the container terminal. Any increase would immediately be

applied to gateway traffic, but would be phased for transhipment volumes, where user

agreements refer to an absolute tariff in MYR. Gateway port user agreements allow for

immediate implementation as they reference "the prevailing tariff in Port Klang". Difficulty

is in predicting the timing of any approval, which remains uncertain.

Volumes - up double-digit 1Q15 YTD. Accommodation of Oceans 3 (alliance of CMA

CGM, United Arab Shipping Corporation and China Shipping Container Lines) was one of

the reasons that WHB will build CT8. The extra capacity will allow it to recapture most of

CMA CGM's transhipment boxes that currently use PTP (around 700K TEU/year), most of

which should flow back to WHB. In the first two months of 2015 WHB has benefitted from

Oceans 3, which has picked up share on Asia-Europe and think that QE in Europe should

see volumes continue to grow strongly. The Free Trade Zone adjacent to WHB is also

seeing cargo concentrated in Malaysia that was previously stored elsewhere in Asia.

Cotton, polymers among others are being stored in the FTZ and these get handled by

WHB.

Wilmar (WLIL.SI)

Speaker: Mr Ho KK, CFO

New News: Yes

Tone: Positive

Positive: Wilmar said Oilseed margins are positive in 1H2015, as financial speculators

have been clamped down and the market in China is now more disciplined.

Positive: The Consumer Product division is the main focus, leveraging on Goodman

Fielder's established brand names (e.g., Meadow Lea and Praise) and Wilmar's extensive

distribution network in China, Indonesia and Vietnam. Wilmar believes this division is

undervalued despite it having a 44% market share in the branded cooking oil market in

China.

Negative: Wilmar believes downstream margins for the palm processing may not be

sustainable as the Indonesia biodiesel subsidies and new formula may not be up and

running so quickly. Wilmar is also bearish on CPO prices.

Positive: Wilmar will see huge cash inflow with low commodity prices as working capital

requirements are reduced. It is also a beneficiary of lower commodity prices as its

Ting Min Tan

+60 3 2723 2080

tingmin.tan@credit-

suisse.com

31 March 2015


downstream operations dominate the upstream business. Hence, it is open to paying out

more dividends.

Xiabu Xiabu (0520.HK)

Speaker: Kuang-Chi Ho (Chairman), Julia Zhao (CFO)

New News: Yes

Tone: Positive

1Q15 update: January is positive, February is negative. Latest observation of March is

positive with decent traffic.

Strategy focus:

3-3.5% SSSG to be driven by ASP (following CPI) and traffic recovery.

Launch of Xiabuxiabu Stop integrated with current store, to create additional sale of

beverage and sweets. Seven stores on trial and expect to officially launch by end of the

year.

New format of Xiabuxiabu store in Shanghai to cater for fashion diversity in Eastern China.

Potential tax reform by August could save costs for big chain restaurants such as

Xiabuxiabu.

YY (YY.OQ)

Speaker: Eric He, CFO

New News: None

Tone: Neutral

The company aims to spend a total of Rmb700 mn on game broadcasting business this

year, which it says will likely generate a net loss of Rmb400 mn this year.

YY will press ahead with the current cash-burning strategy to grab market share from its

major competitor, Douyu.

YY advises Douyu is seeking a new round of financing. If Douyu eventually burns out its

cash, the competitive landscape in game cast may improve in the CFO's view.

The CFO is comfortable with street's forecast of 40-50% top-line growth in FY2015. But he

noted the margin pressure due to the incubation of game cast business.

Zhaopin (ZPIN.N)

Speaker: Jessica Ye, Executive Vice President

New News: None

Tone: Positive

The company still has a relatively low penetration on both the employer and job seeker

fronts. Zhaopin and 51jobs together account for 70% of market share in online recruitment.

Different from 51Jobs, Zhaopin is focusing on the job seekers side with leading traffic

metrics while 51jobs targets integrated HR solutions. In online recruitment business,

Zhaopin and 51jobs are similar in terms of pricing, and still quite cheap compared to

overseas markets. The company is still focusing on scale rather than pricing.

In terms of ARPU, Zhaopin is lower than 51jobs due to customer mix, as Zhaopin serves

larger portion of SME while 51jobs has more contribution from KA accounts. Management

Sophie Chiu

+852 2101 7657

sophie.chiu@credit-

suisse.com

Jialong Shi

+ 852 2101 7347

jialong.shi@credit-

suisse.com

Evan Zhou

+ 852 2101 6745

evan.zhou@credit-

suisse.com

31 March 2015


continues to see huge potential in lower tier cities. The company launched several new

products last year, such as express listing and priority listing, to push up ARPU. The

priority listing service contributes several million RMB per month, in 2H14, it recorded a

total of Rmb20 mn. However, customer-base growth has the most impact on ARPU.

Management expects ARPU will slow down in a decreasing trend, and will also fluctuate

with seasonality.

Zhaopin is able to maintain a high retention rate of 50-60% for customers on a YoY basis,

considering the average turnover rate of 30% for SME in China. In addition, the company

still sees strong growth in the customer base.

According to management, Zhaopin will maintain consistent sales personnel growth, but

less reliance on field sales going forward with the effort of moving service online.

Marketing accounts for 9-10% of total revenue while sales expenses are 30-35% of the

total revenue. Going forward, percentage wise, management expects that sales expenses

will go down. Management also mentioned that VAT process has almost finished for

Zhaopin, and has been fully reflected in the financials.

After CJOL, the company is the leading player in South China market, and plans to

continue maintaining CJOL brand. The company is conducting restructuring on CJOL after

the merger by transferring the product and technology know-how to CJOL. Management

expects CJOL to contribute more to the topline going forward.

According to management, the company currently is active in M&A and there is some

progress. Lock up for IPO expired last December, and trading volume is trending up. The

company is also thinking about ways to boost up liquidity.

Zijin Mining (2899.HK)

Speaker: Qiang Liu (Secretary of BoD)

New News: None

Tone: Neutral

2014 earnings up 10% YoY, major contributions are (1) hedging gain of Rmb657 mn. The

hedging business will continue, with a limit of no more than 50% of self-mined gold; (2)

Rmb500 mn loss saving from smelting business (from Rmb900 mn loss to Rmb400 mn

loss). And Zijin is aiming to keep all smelting operations profitable in 2015E.

Management expects production growth to remain stable going forward and the organic

growth of mined gold production to be 2 tonnes by 2017. Among all, Zijinshan’s gold

output will be stable at 8-10 tonnes before retiring. But Zijinshan copper output will be 50kt

in 2015E, from 38kt in 2014A. The long-term output target for Zijinshan Copper will be 60kt.

Zijin’s debt structure is 40% USD loan and 60% RMB loan. The appreciation of RMB has

mostly covered Zijin’s USD loan interest in the past few years. Management is working

closely to manage the FX and interest risks, particularly in overseas market.

Zijin’s 2015E capex will be Rmb2.17 bn, or Rmb3.4 bn if including Congo project (with a

total capex from Zijin of about US$500 mn and US$180 mn in 2015E).

Owen Liang

+852 2101 6093

owen.liang@credit-

suisse.com

x-apple-data-detectors://0/

31 March 2015


Companies Mentioned (Price as of 29-Mar-2015)

ASM Pacific Tech. (0522.HK, HK$78.35) AU Optronics (2409.TW, NT$15.5) AirAsia X (AIRX.KL, RM0.46) Ajisen (0538.HK, HK$4.27) Astra International (ASII.JK, Rp8,200) Ayala Land (ALI.PS, P37.6) BASF (BASFn.DE, €92.07) BTS Group Holdings PCL (BTS.BK, Bt9.05) Baidu Inc (BIDU.OQ, $207.33) Bharti Infratel Ltd (BHRI.BO, Rs376.5) Bloomberry Resorts Corporation (BLOOM.PS, P10.4) Bumi Armada Bhd (BUAB.KL, RM1.04) CIMB Group Holdings Bhd (CIMB.KL, RM6.14) CTBC Holding (2891.TW, NT$20.45) Cheung Kong Infrastructure (1038.HK, HK$66.25) China Animal Healthcare Ltd (0940.HK, HK$5.2) China Gas Holdings Ltd (0384.HK, HK$12.7) China Lodging Group (HTHT.OQ, $19.55) China Resources Cement Holdings Ltd (1313.HK, HK$4.31) China Resources Power Holdings (0836.HK, HK$19.4) China Shenhua Energy Company Limited (1088.HK, HK$18.82) Chow Tai Fook Jewellery Group Limited (1929.HK, HK$7.91) Ctrip.com International (CTRP.OQ, $59.21) Dawnrays Pharmaceutical (Holdings) Limited (2348.HK, HK$5.6) Delta Electronics (2308.TW, NT$193.0) Dharma Satya Nusantara (DSNG.JK, Rp4,595) Dr. Reddy's Laboratories Limited (REDY.BO, Rs3414.75) Gajah Tunggal (GJTL.JK, Rp1,260) Genting Singapore (GENS.SI, S$0.94) Globe Telecom Inc (GLO.PS, P2002.0) Grasim Industries (GRAS.BO, Rs3554.35) HCL Techno (HCLT.NS, Rs962.85) HDFC Bank (HDBK.BO, Rs1013.35) HTC Corp (2498.TW, NT$138.0) Hollysys Automation Technologies Ltd. (HOLI.OQ, $19.56) Home Inns & Hotels Management Inc (HMIN.OQ, $24.27) Hong Kong Electric Investments (2638.HK, HK$5.33) Housing Development Finance Corp (HDFC.BO, Rs1261.75) Huaneng Power International Inc (0902.HK, HK$8.78) IDFC Ltd (IDFC.BO, Rs167.9) IJM Corporation Berhad (IJMS.KL, RM7.2) Indofood Agri Resources Ltd (IFAR.SI, S$0.75) Indofood CBP (ICBP.JK, Rp14,100) Inotera Memories Inc. (3474.TW, NT$39.8) JSR (4185.T, ¥2,098) Jumei International Holding Limited (JMEI.N, $16.17) Korea Electric Power (015760.KS, W45,000) LG Chem Ltd. (051910.KS, W226,500) LG Household & Healthcare (051900.KS, W788,000) LT Group, Inc. (LTG.PS, P16.54) Las Vegas Sands Corp. (LVS.N, $54.75) Lenovo Group Ltd (0992.HK, HK$11.08) Lifestyle International Holdings Ltd (1212.HK, HK$13.42) Luk Fook Holdings International (0590.HK, HK$21.25) Matahari Department Store (LPPF.JK, Rp18,600) Matahari Putra Prima (MPPA.JK, Rp4,005) Maxis Berhad (MXSC.KL, RM7.15) MediaTek Inc. (2454.TW, NT$419.0) Melco Crown Entertainment-ADR (MPEL.OQ, $21.7) Midea Group (000333.SZ, Rmb31.54) Mitsubishi Chemical Holdings (4188.T, ¥718) NagaCorp Limited (3918.HK, HK$5.14) Neptune Orient Lines (NEPS.SI, S$1.01) NetEase.com (NTES.OQ, $103.83) New Oriental Education (EDU.N, $22.17) Nine Dragons Paper Holdings Ltd (2689.HK, HK$4.78) Nippon Yusen Kabushiki Kaisha (9101.T, ¥351) OSIM International (OSIL.SI, S$2.01) Orient Overseas International (0316.HK, HK$46.15) PT Bank Central Asia Tbk (BBCA.JK, Rp14,450) PT Blue Bird (BIRD.JK, Rp9,925) PT Lippo Karawaci Tbk (LPKR.JK, Rp1,285) PT Summarecon Agung Tbk (SMRA.JK, Rp1,625) PTT Public Company Limited (PTT.BK, Bt325.0) Qihoo 360 Technology Co. Ltd. (QIHU.N, $52.09) RHB Capital Berhad (RHBC.KL, RM7.93) Robinsons Land Corporation (RLC.PS, P31.3) S-Oil Corp (010950.KS, W63,800) SJM (0880.HK, HK$10.16) SK Hynix Inc. (000660.KS, W45,800) Sa Sa International Holding (0178.HK, HK$3.8) Samsung C&T Corporation (000830.KS, W58,900)

31 March 2015


Sands China (1928.HK, HK$32.3) Sembcorp Industries Limited (SCIL.SI, S$4.29) Semiconductor Manufacturing International Corp. (0981.HK, HK$0.71) Showa Denko (4004.T, ¥154) Shriram Transport Finance Co Ltd (SRTR.BO, Rs1082.5) Siliconware Precision (2325.TW, NT$51.1) Skyworth Digital (0751.HK, HK$5.8) Stella (1836.HK, HK$18.6) TAL International Group (TAL.N, $41.2) TCL Corporation (000100.SZ, Rmb5.86) TPK Holdings (3673.TW, NT$213.5) Taiwan Semiconductor Manufacturing (2330.TW, NT$142.5) Tata Consultancy Services (TCS.BO, Rs2516.2) Texhong Textile Group (2678.HK, HK$8.95) Thai Beverage (TBEV.SI, S$0.74) Thai Union Frozen Products PCL (TUF.BK, Bt20.0) Tokuyama (4043.T, ¥263) Toshiba (6502.T, ¥513) Tosoh (4042.T, ¥572) Tsui Wah Holding (1314.HK, HK$2.36) Tune Ins Holdings Berhad (TUNE.KL, RM1.99) Ultratech Cement Ltd (ULTC.BO, Rs2805.25) VGI Global Media PCL (VGI.BK, Bt5.45) Visi Media Asia (VIVA.JK, Rp510) Waskita Karya (WSKT.JK, Rp1,720) Weibo Corporation (WB.OQ, $12.93) Westports Holdings Berhad (WPHB.KL, RM3.7) Wilmar International Ltd (WLIL.SI, S$3.27) Xiabu Xiabu (0520.HK, HK$4.26) YY INC. (YY.OQ, $55.2) Zhaopin Limited (ZPIN.N, $15.12) Zijin Mining Group Co., Ltd (2899.HK, HK$2.26)

Disclosure Appendix

Important Global Disclosures

The analysts identified in this report each certify, with respect to the companies or securities that the individual analyzes, that (1) the views expressed in this report accurately reflect his or her personal views about all of the subject companies and securities and (2) no part of his or her compensation was, is or will be directly or indirectly related to the specific recommendations or views expressed in this report.

The analyst(s) responsible for preparing this research report received Compensation that is based upon various factors including Credit Suisse's total revenues, a portion of which are generated by Credit Suisse's investment banking activities

As of December 10, 2012 Analysts’ stock rating are defined as follows:

Outperform (O) : The stock’s total return is expected to outperform the relevant benchmark*over the next 12 months.

Neutral (N) : The stock’s total return is expected to be in line with the relevant benchmark* over the next 12 months.

Underperform (U) : The stock’s total return is expected to underperform the relevant benchmark* over the next 12 months.

*Relevant benchmark by region: As of 10th December 2012, Japanese ratings are based on a stock’s total retu rn relative to the analyst's coverage universe which consists of all companies covered by the analyst within the relevant sector, with Outperforms representing the most attractiv e, Neutrals the less attractive, and Underperforms the least attractive investment opportunities. As of 2nd October 2012, U.S. and Canadian as well as European ratings are based on a stock’s total return relative to the analyst's coverage universe which consists of all companies covered by the analyst within the relevant sector, with Outperforms representing the most attractive, Neutrals the less attractive, and Underperforms the least attractive investment opportunities. For Latin Ame rican and non-Japan Asia stocks, ratings are based on a stock’s total return relative to the average total return of the relevant country or regional benchmark; prior to 2nd October 2012 U.S. and Canadian ratings were based on (1) a stock’s absolute total return potential to its current share price and (2) the relative attractiveness of a stock’s total return potential within an analyst’s coverage universe. For Australian and New Zealand stocks, 12 -month rolling yield is incorporated in the absolute total return calculation and a 15% and a 7.5% threshold replace the 10-15% level in the Outperform and Underperform stock rating definitions, respectively. The 15% and 7.5% thresholds replace the +10 -15% and -10-15% levels in the Neutral stock rating definition, respectively. Prior to 10th December 2012, Japanese ratings were based on a stock’s total return relative to the average total return of the relevant country or regional benchmark.

Restricted (R) : In certain circumstances, Credit Suisse policy and/or applicable law and regulations preclude certain types of communications, including an investment recommendation, during the course of Credit Suisse's engagement in an investment banking transaction and in certain other circumstances.

Volatility Indicator [V] : A stock is defined as volatile if the stock price has moved up or down by 20% or more in a month in at least 8 of the past 24 months or the analyst expects significant volatility going forward.

Analysts’ sector weightings are distinct from analysts’ stock ratings and are based on the analyst’s expectations for the fundamentals and/or valuation of the sector* relative to the group’s historic fundamentals and/or valuation:

Overweight : The analyst’s expectation for the sector’s fundamentals and/or valuation is favorable over the next 12 months.

31 March 2015


Market Weight : The analyst’s expectation for the sector’s fundamentals and/or valuation is neutral over the next 12 months.

Underweight : The analyst’s expectation for the sector’s fundamentals and/or valuation is cautious over the next 12 months.

*An analyst’s coverage sector consists of all companies covered by the analyst within the relevant sector. An analyst may cover multiple sectors.

Credit Suisse's distribution of stock ratings (and banking clients) is:

Global Ratings Distribution

Rating Versus universe (%) Of which banking clients (%)

Outperform/Buy* 44% (53% banking clients)

Neutral/Hold* 38% (50% banking clients)

Underperform/Sell* 16% (44% banking clients)

Restricted 3%

*For purposes of the NYSE and NASD ratings distribution disclosure requirements, our stock ratings of Outperform, Neutral, an d Underperform most closely correspond to Buy, Hold, and Sell, respectively; however, the meanings are not the same, as our stock ratings are determined on a relative basis. (Please refer to definitions above.) An investor's decision to buy or sell a security should be based on investment objectives, current holdings, and other individual factors.

Credit Suisse’s policy is to update research reports as it deems appropriate, based on developments with the subject company, the sector or the market that may have a material impact on the research views or opinions stated herein.

Credit Suisse's policy is only to publish investment research that is impartial, independent, clear, fair and not misleading. For more detail please refer to Credit Suisse's Policies for Managing Conflicts of Interest in connection with Investment Research: http://www.csfb.com/research-and-analytics/disclaimer/managing_conflicts_disclaimer.html

Credit Suisse does not provide any tax advice. Any statement herein regarding any US federal tax is not intended or written to be used, and cannot be used, by any taxpayer for the purposes of avoiding any penalties.

See the Companies Mentioned section for full company names

The subject company (000333.SZ, IJMS.KL, 1928.HK, 2899.HK, WB.OQ, TBEV.SI, HDBK.BO, GLO.PS, ALI.PS, RHBC.KL, GENS.SI, WPHB.KL, 015760.KS, BUAB.KL, NEPS.SI, 3918.HK, OSIL.SI, RLC.PS, JMEI.N, 0520.HK, TUNE.KL, ICBP.JK, TCS.BO, CIMB.KL, AIRX.KL, 1038.HK, PTT.BK, 2454.TW, IDFC.BO, IFAR.SI, 1088.HK, QIHU.N, 2330.TW, 1313.HK, 000830.KS, TAL.N, SMRA.JK, 000660.KS, 2498.TW, EDU.N, 051900.KS, 0902.HK, BIRD.JK, ULTC.BO, ZPIN.N, CTRP.OQ, BBCA.JK, GRAS.BO, 2891.TW, 3673.TW, 051910.KS, 6502.T, 0836.HK, LTG.PS, BIDU.OQ, LPKR.JK, 0992.HK, LVS.N) currently is, or was during the 12-month period preceding the date of distribution of this report, a client of Credit Suisse.

Credit Suisse provided investment banking services to the subject company (WB.OQ, HDBK.BO, GLO.PS, ALI.PS, RHBC.KL, WPHB.KL, 015760.KS, BUAB.KL, 3918.HK, RLC.PS, JMEI.N, 0520.HK, TUNE.KL, ICBP.JK, CIMB.KL, AIRX.KL, PTT.BK, IDFC.BO, IFAR.SI, QIHU.N, 000830.KS, 000660.KS, EDU.N, BIRD.JK, ZPIN.N, BIDU.OQ, LPKR.JK, 0992.HK) within the past 12 months.

Credit Suisse provided non-investment banking services to the subject company (000333.SZ, BIRD.JK, 2891.TW) within the past 12 months

Credit Suisse has managed or co-managed a public offering of securities for the subject company (HDBK.BO, ALI.PS, BUAB.KL, 0520.HK, TUNE.KL, PTT.BK, IDFC.BO, QIHU.N, 000660.KS, BIRD.JK, ZPIN.N, LPKR.JK, 0992.HK) within the past 12 months.

Credit Suisse has received investment banking related compensation from the subject company (WB.OQ, HDBK.BO, GLO.PS, ALI.PS, RHBC.KL, WPHB.KL, 015760.KS, BUAB.KL, 3918.HK, RLC.PS, JMEI.N, 0520.HK, TUNE.KL, ICBP.JK, CIMB.KL, AIRX.KL, PTT.BK, IDFC.BO, IFAR.SI, QIHU.N, 000830.KS, 000660.KS, EDU.N, BIRD.JK, ZPIN.N, BIDU.OQ, LPKR.JK, 0992.HK) within the past 12 months

Credit Suisse expects to receive or intends to seek investment banking related compensation from the subject company (000333.SZ, IJMS.KL, 1928.HK, 2899.HK, WB.OQ, TBEV.SI, HDBK.BO, 2308.TW, GLO.PS, ALI.PS, 1314.HK, RHBC.KL, 1212.HK, GENS.SI, MPEL.OQ, WPHB.KL, 0538.HK, 015760.KS, 0522.HK, BUAB.KL, NEPS.SI, 0940.HK, 3918.HK, OSIL.SI, 4042.T, RLC.PS, NTES.OQ, JMEI.N, BHRI.BO, 0520.HK, TUNE.KL, ICBP.JK, TCS.BO, CIMB.KL, AIRX.KL, 1038.HK, PTT.BK, 2454.TW, IDFC.BO, IFAR.SI, 010950.KS, 1088.HK, QIHU.N, 1313.HK, 000830.KS, TAL.N, 1929.HK, 0316.HK, SMRA.JK, 0751.HK, 000660.KS, 4185.T, 2498.TW, YY.OQ, EDU.N, 051900.KS, 0902.HK, BIRD.JK, ULTC.BO, ZPIN.N, CTRP.OQ, BBCA.JK, GRAS.BO, 2891.TW, 3673.TW, 051910.KS, 4004.T, 6502.T, 0836.HK, LTG.PS, 4043.T, BIDU.OQ, LPKR.JK, 9101.T, 0992.HK, LVS.N) within the next 3 months.

Credit Suisse has received compensation for products and services other than investment banking services from the subject company (000333.SZ, BIRD.JK, 2891.TW) within the past 12 months

As of the date of this report, Credit Suisse makes a market in the following subject companies (TAL.N, 6502.T, LVS.N).

Credit Suisse may have interest in (MXSC.KL, IJMS.KL, RHBC.KL, WPHB.KL, BUAB.KL, TUNE.KL, CIMB.KL, AIRX.KL)

As of the end of the preceding month, Credit Suisse beneficially own 1% or more of a class of common equity securities of (2308.TW, 2454.TW, 1088.HK, 2330.TW, BASFn.DE, 2498.TW, 0902.HK, ZPIN.N, 2891.TW, 3673.TW, 2325.TW, 2409.TW).

Credit Suisse has a material conflict of interest with the subject company (GLO.PS) . Kaikhushru Nargolwala, a Member of the Executive Board of Credit Suisse, is a non-executive and independent Director of Singapore Telecommunications Ltd.

Credit Suisse has a material conflict of interest with the subject company (0981.HK) . Credit Suisse USA LLC is acting as an advisor to Atmel Corp on the potential transaction with Microchip Technology and On Semiconductor.

31 March 2015


Credit Suisse has a material conflict of interest with the subject company (HMIN.OQ) . Credit Suisse is acting as financial advisor to Home Inns & Hotels Management Inc. and Credit Suisse AG, Singapore Branch has been mandated by Home Inns & Hotels Management Inc. to arrange a financing for it in relation to the announced acquisition of Motel 168 International Holdings Limited.

Credit Suisse has a material conflict of interest with the subject company (2330.TW) . Credit Suisse is acting as the financial advisor to Motech Industries Inc in relation to the share subscription by Taiwan Semiconductor Manufacturing Co., Ltd.

Credit Suisse has a material conflict of interest with the subject company (051900.KS) . Credit Suisse is acting as exclusive financial advisor to LG Household & Health Care Ltd. for the acquisition of Everlife Co., Ltd. from CLSA Sunrise Capital, L.P.

Credit Suisse has a material conflict of interest with the subject company (6502.T) . Credit Suisse Securities (USA) LLC is acting as an advisor to Landis+Gyr on the announced acquisition by Toshiba Corporation. This acquisition remains subject to regulatory approvals and other customary closing conditions.

Credit Suisse has a material conflict of interest with the subject company (WLIL.SI) . Credit Suisse is acting as financial advisor to Goodman Fielder in relation to the receipt of the announced proposal from Wilmar International Limited and First Pacific Company Limited.

Credit Suisse has a material conflict of interest with the subject company (0992.HK) . Credit Suisse is acting as financial advisor to Lenovo Group Limited for its proposed acquisition of Motorola Mobility Group from Google.

For other important disclosures concerning companies featured in this report, including price charts, please visit the website at https://rave.credit-suisse.com/disclosures or call +1 (877) 291-2683.

Important Regional Disclosures

Singapore recipients should contact Credit Suisse AG, Singapore Branch for any matters arising from this research report.

The analyst(s) involved in the preparation of this report have not visited the material operations of the subject company (000333.SZ, MXSC.KL, IJMS.KL, 1928.HK, 2899.HK, WB.OQ, TBEV.SI, HDBK.BO, 2308.TW, GLO.PS, ALI.PS, 1314.HK, RHBC.KL, 1212.HK, HTHT.OQ, SCIL.SI, GENS.SI, MPEL.OQ, 4188.T, WPHB.KL, 0538.HK, 015760.KS, 015760.KS, 0522.HK, BUAB.KL, NEPS.SI, MPPA.JK, 0940.HK, 3918.HK, OSIL.SI, 4042.T, RLC.PS, NTES.OQ, JMEI.N, 0981.HK, BHRI.BO, 0520.HK, HMIN.OQ, SRTR.BO, TUNE.KL, ICBP.JK, TCS.BO, CIMB.KL, AIRX.KL, 1038.HK, PTT.BK, DSNG.JK, 2454.TW, IDFC.BO, IFAR.SI, 010950.KS, 1088.HK, 1088.HK, ASII.JK, QIHU.N, 2638.HK, 2330.TW, 1313.HK, 000830.KS, TAL.N, 000100.SZ, 1929.HK, 0384.HK, BASFn.DE, 2678.HK, BLOOM.PS, 0316.HK, SMRA.JK, 0751.HK, TUF.BK, 000660.KS, BTS.BK, 4185.T, 2498.TW, YY.OQ, EDU.N, 051900.KS, 0902.HK, LPPF.JK, 1836.HK, BIRD.JK, REDY.BO, ULTC.BO, HDFC.BO, ZPIN.N, CTRP.OQ, 2689.HK, VGI.BK, BBCA.JK, GRAS.BO, 2348.HK, 2891.TW, 3673.TW, 051910.KS, 4004.T, WSKT.JK, 0178.HK, 6502.T, 0836.HK, LTG.PS, WLIL.SI, 4043.T, 0880.HK, BIDU.OQ, 9101.T, 0992.HK, 0590.HK, 2325.TW, HOLI.OQ, 2409.TW, LVS.N) within the past 12 months

Restrictions on certain Canadian securities are indicated by the following abbreviations: NVS--Non-Voting shares; RVS--Restricted Voting Shares; SVS--Subordinate Voting Shares.

Individuals receiving this report from a Canadian investment dealer that is not affiliated with Credit Suisse should be advised that this report may not contain regulatory disclosures the non-affiliated Canadian investment dealer would be required to make if this were its own report.

For Credit Suisse Securities (Canada), Inc.'s policies and procedures regarding the dissemination of equity research, please visit http://www.csfb.com/legal_terms/canada_research_policy.shtml.

The following disclosed European company/ies have estimates that comply with IFRS: (BASFn.DE).

Credit Suisse has acted as lead manager or syndicate member in a public offering of securities for the subject company (MXSC.KL, HDBK.BO, ALI.PS, WPHB.KL, BUAB.KL, RLC.PS, 0520.HK, TUNE.KL, CIMB.KL, AIRX.KL, PTT.BK, DSNG.JK, IDFC.BO, QIHU.N, BASFn.DE, 000660.KS, 0902.HK, BIRD.JK, ZPIN.N, BBCA.JK, LTG.PS, LPKR.JK, 0992.HK) within the past 3 years.

As of the date of this report, Credit Suisse acts as a market maker or liquidity provider in the equities securities that are the subject of this report.

Principal is not guaranteed in the case of equities because equity prices are variable.

Commission is the commission rate or the amount agreed with a customer when setting up an account or at any time after that.

For Thai listed companies mentioned in this report, the independent 2014 Corporate Governance Report survey results published by the Thai Institute of Directors Association are being disclosed pursuant to the policy of the Office of the Securities and Exchange Commission: Thai Beverage () , PTT Public Company Limited (Excellent) , Thai Union Frozen Products PCL (Good) , BTS Group Holdings PCL (Excellent) , VGI Global Media PCL (Very Good)

Please find the full reports, including disclosure information, on Credit Suisse's Research and Analytics Website (http://www.researchandanalytics.com)

For Credit Suisse disclosure information on other companies mentioned in this report, please visit the website at https://rave.credit-suisse.com/disclosures or call +1 (877) 291-2683.

31 March 2015


References in this report to Credit Suisse include all of the subsidiaries and affiliates of Credit Suisse operating under its investment banking division. For more information on our structure, please use the following link: https://www.credit-suisse.com/who_we_are/en/This report may contain material that 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 or which would subject Credit Suisse AG or its affiliates ("CS") to any registration or licensing requirement within such jurisdiction. All material presented in this report, unless specifically indicated otherwise, is under copyright to CS. None of the material, nor its content, nor any copy of it, may be altered in any way, transmitted to, copied or distributed to any other party, without the prior express written permission of CS. All trademarks, service marks and logos used in this report are trademarks or service marks or registered trademarks or service marks of CS or its affiliates. The information, tools and material presented in this report are provided to you for information purposes only and are not to be used or considered as an offer or the solicitation of an offer to sell or to buy or subscribe for securities or other financial instruments. CS may not have taken any steps to ensure that the securities referred to in this report are suitable for any particular investor. CS will not treat recipients of this report as its customers by virtue of their receiving this report. The investments and services contained or referred to in this report may not be suitable for you and it is recommended that you consult an independent investment advisor if you are in doubt about such investments or investment services. Nothing in this report constitutes investment, legal, accounting or tax advice, or a representation that any investment or strategy is suitable or appropriate to your individual circumstances, or otherwise constitutes a personal recommendation to you. CS does not advise on the tax consequences of investments and you are advised to contact an independent tax adviser. Please note in particular that the bases and levels of taxation may change. Information and opinions presented in this report have been obtained or derived from sources believed by CS to be reliable, but CS makes no representation as to their accuracy or completeness. CS accepts no liability for loss arising from the use of the material presented in this report, except that this exclusion of liability does not apply to the extent that such liability arises under specific statutes or regulations applicable to CS. This report is not to be relied upon in substitution for the exercise of independent judgment. CS may have issued, and may in the future issue, other communications that are inconsistent with, and reach different conclusions from, the information presented in this report. Those communications reflect the different assumptions, views and analytical methods of the analysts who prepared them and CS is under no obligation to ensure that such other communications are brought to the attention of any recipient of this report. Some investments referred to in this report will be offered solely by a single entity and in the case of some investments solely by CS, or an associate of CS or CS may be the only market maker in such investments. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied, is made regarding future performance. Information, opinions and estimates contained in this report reflect a judgment at its original date of publication by CS and are subject to change without notice. The price, value of and income from any of the securities or financial instruments mentioned in this report can fall as well as rise. The value of securities and financial instruments is subject to exchange rate fluctuation that may have a positive or adverse effect on the price or income of such securities or financial instruments. Investors in securities such as ADR's, the values of which are influenced by currency volatility, effectively assume this risk. Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to sophisticated investors who are capable of understanding and assuming the risks involved. The market value of any structured security may be affected by changes in economic, financial and political factors (including, but not limited to, spot and forward interest and exchange rates), time to maturity, market conditions and volatility, and the credit quality of any issuer or reference issuer. Any investor interested in purchasing a structured product should conduct their own investigation and analysis of the product and consult with their own professional advisers as to the risks involved in making such a purchase. Some investments discussed in this report may have a high level of volatility. High volatility investments may experience sudden and large falls in their value causing losses when that investment is realised. Those losses may equal your original investment. Indeed, in the case of some investments the potential losses may exceed the amount of initial investment and, in such circumstances, you may be required to pay more money to support those losses. Income yields from investments may fluctuate and, in consequence, initial capital paid to make the investment may be used as part of that income yield. Some investments may not be readily realisable and it may be difficult to sell or realise those investments, similarly it may prove difficult for you to obtain reliable information about the value, or risks, to which such an investment is exposed. This report may provide the addresses of, or contain hyperlinks to, websites. Except to the extent to which the report refers to website material of CS, CS has not reviewed any such site and takes no responsibility for the content contained therein. 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U67120MH1996PTC104392) regulated by the Securities and Exchange Board of India (registration Nos. INB230970637; INF230970637; INB010970631; INF010970631), having registered address at 9th Floor, Ceejay House, Dr.A.B. Road, Worli, Mumbai - 18, India, T- +91-22 6777 3777, Credit Suisse Securities (Europe) Limited, Seoul Branch, Credit Suisse AG, Taipei Securities Branch, PT Credit Suisse Securities Indonesia, Credit Suisse Securities (Philippines ) Inc., and elsewhere in the world by the relevant authorised affiliate of the above. Research on Taiwanese securities produced by Credit Suisse AG, Taipei Securities Branch has been prepared by a registered Senior Business Person. Research provided to residents of Malaysia is authorised by the Head of Research for Credit Suisse Securities (Malaysia) Sdn Bhd, to whom they should direct any queries on +603 2723 2020. 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Investment principal on bonds can be eroded depending on sale price or market price. In addition, there are bonds on which investment principal can be eroded due to changes in redemption amounts. Care is required when investing in such instruments. When you purchase non-listed Japanese fixed income securities (Japanese government bonds, Japanese municipal bonds, Japanese government guaranteed bonds, Japanese corporate bonds) from CS as a seller, you will be requested to pay the purchase price only.

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