Underwriting, Placementsand the

Art of Investor Relations

Sherilyn FoongDirector / Head of Equity Capital Markets

Alliance Investment Bank Berhad11 June 2008

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Underwriting & Placements

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Stages Of An IPO

Coordinate efforts of all advisers, i.e. due diligence, submissions, documentations.

Coordination ApprovalProcess

StatusReview

CompletionProcess

PostCompletion

Liaise with the relevant authorities such as the Securities Commission, Foreign Investment Committee, Ministry of International Trade & Industry, Bursa Securities.

Monitor progress periodically.

Underwriting, placement & distribution.

Pricing.Roadshows.Research &

marketing.Investor

Relations strategy.

Despatch of Prospectus.

Listing.

Follow-up on any conditions that may be imposed by the relevant authorities.

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Facilitator of equity & equity-linked transactions

Interface between non-retail buyers and sellers of equity & equity- linked instruments.

Sourcing of new IPOs & Private Placements for the Bank. Advising corporate clients on equity market conditions

and the suitability to undertake equity or equity-linked transactions.

Underwriter of IPOs

Ensuring that the required equity funding for the Company is available in the event of an IPO undersubscription.

Risk undertaken involve subscribing for the underwritten shares in the event of undersubscription.

Placement Agent

Sourcing for new investors that would be interested to acquire new / existing Private Placement shares being offered by the company / existing shareholder(s) and facilitating the resultant primary / secondary market transaction.

Role Of An ECM Unit Within An Investment Bank

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Underwriting

Underwriting - where an Investment Bank / Universal Broker agrees to subscribe for any unsubscribed shares that has been issued / offered by an Issuer.

Objective - ensuring that the required equity funding that a Company needs is available in the event of an undersubscription.

In return for the risks undertaken, there is an underwriting commission.

For large issues, a Managing Underwriter may be appointed to manage the Co-Underwriters.

Underwriting Agreement is the primary legal document.

Only the shares offered to the public and employees (pink forms) are typically underwritten in an IPO.

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Placements

Placement - Placement Agent, usually the same as the Adviser, will place out shares reserved under Private Placement portion to qualified investors.

Objective - to look for quality shareholders and to those who can bring value to the company.

Book-building - price discovery mechanism to determine “market price” of an IPO which normally conducted for well known larger issues.

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Book-Building Book-building is an exercise where investors submit bids throughout the offer period, indicating demand and

price sensitivity.Investors pay at a single price

determined after book-building to solicit indications of demand by the company and underwriters, usually

lower than the highest bid to create an over-subscription and stable

aftermarket.Advantages

Roadshows will generate publicity and awareness for the IPO.

Establishes a larger institutional shareholder base and greater stability in

aftermarket.Provides an indication of the market

valuation of the IPO shares to retail investors.

Leads to a more favourable pricing of the retail tranche.

Placements Via Book-Building

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Placements - Targeted Investors

Reaching Out To The Investment Community

Statutory Bodies

Insurance Funds

Asset Management Funds

Unit Trust Funds

Corporates

High Net Worth Individuals

Others

Hedge Funds

EPF, PNB, Lembaga Tabung Haji, …

AIG, Great Eastern, Prudential, …

Alliance Investment, HwangDBS, …

Public Mutual, Pacific Mutual, …

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Investor Roadshow

Whilst promoting the underlying equity “story”, we also give clients the widest “footprint” in terms of investors to place-out the shares to.

By doing so, we generate the strongest possible demand & interest in the shares prior to listing.

Our placement to quality placees will in turn increase the likelihood of a strong after-market share price performance.

ECM will work with specialists in investor relations and the investment community comprising of fund managers and investment analysts to maximise market acceptance of the equity story.

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IPO Institutional Placement - Live Case Study

Typical Placement Allocation Of A Main Board Company

Local Statutory Bodies

6%Corporates

3%

High Net Worth

Individuals45%

Institutional Funds46%

Local & Foreign

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IPO Institutional Placement - Live Case Study

Book Building Demand Allocation

Local Statutory Bodies

6%

Local & ForeignInsurance

Funds17%

Institutional Funds77%

Local Statutory Bodies17%

Local & Foreign Insurance

Funds20%

Institutional Funds63%

Local & ForeignLocal & Foreign

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Funds Raised In 2007 (excluding REITs)

Main Board

81%

RM1,701,544,930

Second Board

17%

RM357,039,263

MESDAQ Market

2%

RM47,560,600

Number Of Listings Excluding REITs

  Main SecondMESDA

Q Total

2007 12 8 3 23

2008* 2 4 5 11

Average Forward PE

Main SecondMESDA

Q

2007 9.16 8.16 10.11

2008* 10.99 7.83 9.29

IPO Statistics

* Completed IPOs between the months of Jan-Apr 2008.

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The Art of Investor Relations (IR)

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IR - What It Is

IPOs is like a 1st marriage - once in lifetime event.

To ensure many “happy returns”, its IR strategy needs to be carefully thought out & planned, and convincingly executed.

IR is the continuous dialogue between your Company and investors and / or the channel medium that feeds the info to be conveyed to investors.

Process of crafting & delivering your Company’s story to the investment community, demonstrating its strengths and investment worthiness.

IR a fight for space in the media for the hearts & minds of investors.

Amplifies your Company’s success in executing its business strategy by providing greater recognition and acceptance.

Not just about promotion. Not a substitute for a Company’s fundamentals.

Consider hiring an IR professional - when doing the job, let’s do it right.

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Elements of an IR Programme

Converting Investors

to Buy

Investible Position

Investor Awareness

& Preference

Fund manager’s briefing

Analyst briefing

News releases

Profiling

Media briefing

Focus on:-

Industry niche & business

Highlight management’s track record & experience

Emphasize financial track record & performance

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How To Start

Basic scope of work for an IR programme. Therefore, you need to:

identify your Company’s key business drivers;

recognise your Company’s strengths & weaknesses;

create & prepare key themes & concise corporate messages;

develop a pro-active IR communication plan; and

once all the above is ready, implement and continuously implement the IR programme over the next 18 months.

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Nuts & Bolts of IR

Objective - simplifying your Company’s complex story to basic, positive messages to be conveyed ultimately translating the shares of your Company to be an attractive investment destination.

Each IR material should contain no more than 3 or 4 key messages.

When formulating key messages, the KISS (i.e. Keep It Simple, Stupid) principle works best (max. of 20 words).

Consistency of messages & its communication is key.

Create & establish an “IR Tool Kit”.

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IR Tool Kit - Essentials

At the minimum, an IR Tool Kit should at least contain:

Fact sheet(s) containing company history, profile, biodata of directors and key management personnel and website address;

Recent quarterly financial statements (relevant post-IPO) and the most recent annual report;

Recent press and media clippings / announcements; and

Contact details on the key IR person(s) in your Company.

Don’t forget to: tailor the IR Tool Kit to convey the key messages to be

brought across; use clear & unambiguous language; ensure layout & format of IR Tool Kit is user friendly; and constantly review, edit and update the IR Tool Kit to ensure

information timeliness & relevancy.

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Newsworthy Key Messages

Examples of positive key messages might include:

growing PAT. expansion of margins. diversification related to existing core competencies. new contracts clinched, entry into a new market. dividend payout increase. appointment of high profile individual into the senior

management team whom is able to further value-add. sector / industry growth and your Company’s positioning

within it.

Emphasis that your Company’s business strategies and expansion plans are sound, realistic & achievable.

The experienced, capability and trustworthiness of senior management to meet expectations.

Being transparent, responsible and accountable for decisions / actions.

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Building Positive Media Relations

Always be:

accessible and available to the media, even after office hours.

responding fast to queries.

having more than 1 spokesperson.

fast tracking media calls. Steps to deal with wrong reporting or misquotes:

First, double-check report to ascertain the mistake / misquote.

Second, determine seriousness of error on Company / self.

If serious:

call the journalist. then send letter to the editor. Last, request for a retraction / clarification of error soonest.

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“No-Nos” When Dealing With The Media

When engaging with the media, DO NOT:

say “no comments”.

say “off the record”.

say anything which casts your Company in a bad light, or bad-mouthing your competitors.

disclose too much about yourself / your Company.

lie or make-up stories.

“Sometimes you say it best, when you say nothing at all…”

overanswer.

request to check and comment on the media piece before release / publication.

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Continuity Is Key

IR is an on-going process, in good times and bad. Therefore, your Company needs to:

continuously get on & continue be on investors’ radar screens.

Management pro-activeness is paramount. Coming clean is essential in order to build & gain trust with investors.

Maintaining close contact with the analyst, fund management & financial media communities to rectify unrealistic earnings forecasts & manage expectations.

establish and widen analyst / financial media coverage.

Provides support to the IR programme via creation and maintaining awareness of your Company to existing / potential investors.

Plays a large influence & shaping investor perception.

increase the number of new shareholders - both retail & institutional.

1 on 1 meetings with buy-side / institutional investors works best.

build a broker network to maximise liquidity and trading opportunities.

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Final Word Of Warning

When talking to the media about your Company, be mindful of what is being disclosed / revealed, as certain information could be price sensitive and/or be subject to verification by an independent 3rd party before public release, under the SC and Bursa Malaysia’s guidelines / listing rules.

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THANK YOU

Sherilyn FoongDirector / Head of

Equity Capital Markets

Tel: 03-2717 6680 (Direct)E-mail: sherilyn@allianceinvestment.com.my

M. Irtiza Azmel M. IsmailAssociate Director

Equity Capital Markets

Tel: 03-2717 6682 (Direct)E-mail: miazmel@allianceinvestment.com.my

Jason LeeSenior Manager

Equity Capital Markets

Tel: 03-2717 6681 (Direct)E-mail: jason@allianceinvestment.com.my

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This presentation was prepared by Alliance Investment Bank Berhad (“Alliance”) exclusively for the benefit and internal use of our client to indicate, on a preliminary basis, the feasibility of a possible transaction(s). The terms and structure of the possible transaction(s) in this presentation are preliminary only and implementation is subject to, inter alia, the satisfactory outcome of due diligence (including legal and financial) of the client. Accordingly, the terms and structure of the possible transaction(s) and their implementation may be subject to material changes.

This presentation is proprietary to Alliance and may not be disclosed to any third party or used for any other purpose without the prior written consent of Alliance.

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