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Asia Pacific Equity Research

23 November 2015

Asian Year Ahead 2016


Stock Ideas for the Year of the Monkey

Chief Asian and Emerging Market


Equity Strategist
AC
Adrian Mowat
(852) 2800-8599
adrian.mowat@jpmorgan.com
Bloomberg JPMA MOWAT <GO>
J.P. Morgan Securities (Asia Pacific) Limited
Head of International Equity
Research
AC
Sunil Garg
(852) 2800-8518
sunil.garg@jpmorgan.com
Bloomberg JPMA GARG <GO>
J.P. Morgan Securities (Asia Pacific) Limited
Head of Asia ex-Japan Equity
Research
AC
James R. Sullivan, CFA
(65) 6882-2374
james.r.sullivan@jpmorgan.com
Bloomberg JPMA SULLIVAN <GO>
J.P. Morgan Securities Singapore Private
Limited

For a full list of authors please


refer to the sector and country
heads list on the back page

See page 523 for analyst certification and important disclosures, including non-US analyst disclosures.
J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the
firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in
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www.jpmorganmarkets.com
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Aditya Srinath AC
Singapore (62-21) 5291-8573, aditya.s.srinath@jpmorgan.com
Bloomberg JPMA SRINATH<GO>
Micro-investment case PT J.P. Morgan Securities Indonesia

The investment case for Singapore is challenged by James Sullivan


(65) 6882-2374, james.r.sullivan@jpmorgan.com
declining domestic property prices (-3% in 9MFY15, we
J.P. Morgan Securities Singapore Private Limited
expect a further 8% in FY16E) and a tight labor market
slowing growth. A transition to a productivity driven Earnings/Revenue growth forecasts and EPS revisions
growth model is ongoing, but not smooth. The economy EPS Revenue
EPS revision (%) Growth Growth
skirted recession in 3Q (0.1%) and growth drivers remain
15E 16E 15E 16E 15E 16E
subdued. Singapore's monetary policy stance leaves it
3M 12M 3M 12M (%) (%) (%) (%)
exposed to rising US rates, while data suggests it does Singapore (2) (6) (4) (10) (2) 5 (5) 6
not benefit from a lift in DM growth. However, a 4% Cons. Disc. (6) (22) (8) (24) (19) 5 (11) 3
plus dividend yield provides significant downside Cons. Services (23) (46) (14) (36) (29) 31 (9) 7
support. Media 6 1 (3) (10) (20) (8) (2) (1)
Retailing (5) (23) (9) (26) (10) 4 (13) 3
Cons. Staples (10) (20) (10) (19) (1) 15 (1) 8
Will EPS downgrades end in 2016? Financials (1) (3) (4) (8) 3 5 6 9
We expect 4.5% market EPS growth vs consensus' 5.7% Banks (1) (2) (5) (8) 3 4 9 8
Div. Financials 0 3 (2) (4) 9 6 13 8
in 2016. This is attributed to our less sanguine outlook on Real Estate 0 (6) 0 (7) 3 7 (2) 12
banks, real estate and telcos. While we see Singaporean Industrials (5) (12) (6) (15) (12) 4 (8) 6
Banks as beneficiary to Fed rate hike, declining trade Capital Goods (6) (15) (7) (20) (18) 1 (9) 6
with China and deteriorating asset quality in emerging Transportation (2) 6 (2) 7 17 16 1 3
Telecom (0) (3) (1) (5) 3 6 (0) 2
ASEAN will hinder earnings delivery. In real estate, we
Source: MSCI, IBES, Datastream, J.P. Morgan, 13 November 2015, Sorted by 2016 EPS
expect residential prices to decline by 8% next year, growth
coupled with increasing vacancy rate in hospitality and
office. In telcos, we forecast competition to heighten as Singapore: Vacancy Rate & Property Price Index
new players potentially enter the market.

Drivers, trends, and data points we are tracking


We track Singapore banks cross-border lending trends.
Singapore has a high trade linkage with China and is
exposed via trade finance links. Domestic property
market trends as well as domestic prices to judge the risk
of deflation. The Biannual MAS policy statements will
also be critical in understanding the gradient of monetary
policy and the SGD outlook.
Source: URA, J.P. Morgan Estimates
Rationale behind our stock picks
Our top picks in Singapore are chosen with the following Singapore Dollar
criteria in mind Stabilization of oil prices (EZION) and
1.5
an improving global growth outlook (SIA). Steady
SGD / $
revenues and dividend plays (SGX). We also see palm oil
prices trend higher as El Nino impacts yields and
recommend First Resources. Hopes of an unwind of 1.4
policy restrictions on property makes us prefer CIT
among the developers. Our Avoids list is based on a
weak outlook for the offshore marine sector (SMM), the 1.3
threat of new competition in the telecom space (Starhub)
and risks to growth and asset quality in the Banks (UOB).
1.2
Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
Source: Bloomberg

96
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Top picks and stocks to avoid


Price Mkt cap P/E (x) EPS (LC) Div. yield ROE
(LC) Code Rating (US$MM) 15E 16E 15E 16E 16E (%) 16E (%)
Top picks
First Resources 2.00 FR SP OW 2230 18.3 14.6 0.08 0.10 2.1 12.2
Singapore Exchanges 7.64 SGX SP OW 5758 23.5 22.2 0.33 0.34 3.7 38.2
Singapore Airlines 10.88 SIA SP OW 8971 34.6 21.5 0.31 0.51 3.7 4.7
Ezion Holdings 0.69 EZI SP OW 639 6.0 3.3 0.08 0.15 0.6 14.3
Stocks to avoid
Sembcorp Marine 2.30 SMM SP UW 3381 12.7 12.0 0.18 0.19 3.6 12.1
UOB 20.51 UOB SP UW 23136 10.7 12.2 1.92 1.68 4.1 9.2
Starhub 3.63 STH SP UW 4392 16.9 16.8 0.21 0.22 6.1 236.8
Source: Bloomberg, J.P. Morgan estimates. Note: Share prices and valuations are as of November 9, 2015.

Best Idea - Overweight STI View + MXSG Rel. View

Singapore Exchange Harsh W. Modi AC


Ticker: SGX SP, Price: S$7.64, PT: S$8.00
Investment thesis: We like SGX for its steady
dividends, a lack of balance sheet risks, and stable
revenues. A good mix of major contracts (Nikkei,
Nifty, A50, etc) should ensure resilient turnover.
Drivers/catalysts: Downside risks include lower
volumes/revenues, lower than expected dividends and
value eroding M&A.
Valuation and risks: Dec-16 PT is based on the mean
dynamic PE, pricing in S$1.15bn of 12-month forward
ADT.

Best Idea - Underweight


Sembcorp Marine Ajay Mirchandani AC
Source: Bloomberg.
Ticker: SMM SP, Price: S$2.3, PT: S$2.00
Investment thesis: Margins have continued to Singapore absolute view lacks directional confidence
disappoint and earnings remain muted. Execution risk although the bearish bias remains. Relative
remains in Brazil, with possibility of cost overrun. performance should remain weak.
SMM also has lower wins of high-margin JU orders.
STI Absolute View STI is in a downtrend with the
Drivers/catalysts: Better than expected Brazil bounce of oversold levels fading fast. Much like rest of
execution, higher order wins, and better margins. ASEAN, we see little reason to buy into Singapore at
Valuation and risks: Our SOTP-based, Dec-16 PT this stage.
consists of DCF valuation for existing order book, 6x
PE multiple on ship repair earnings, and DCF-valuation MXSG Relative View MSCI Singapore's recent
for offshore conversion. underperformance trend remains intact with the relative
index in an underperformance channel for over 2 years.
Remain underweight Singapore.

97
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Top Picks

157
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Ezion Holdings Ltd


Overweight
www.ezionholdings.com
EZHL.SI,EZI SP
Investment Thesis
Price: S$0.66
We remain Overweight on Ezion because we expect strong liftboat demand due to
Price Target: S$1.70
aging platforms and increasing offshore construction activity. Ezions liftboat fleet is
backed by bareboat charters. Among asset owners in Singapore, Ezion stands out as
Singapore one of the cheapest stocks, in our view, at a FY16E P/E of 3.0 x.
Oil Services & Equipment
AC
Ajay Mirchandani Valuation
(65) 6882-2419 Our Dec-16 price target of S$1.70 is based on our SOTP valuation, as follows:
ajay.mirchandani@jpmorgan.com
Bloomberg JPMA MIRCHANDANI <GO>
Valuation Valuation Per share
J.P. Morgan Securities Singapore Private P/E (US$ M) (S$ M) (S$)
Limited
EV of Liftboat / Service Rig portfolio 3839 5,375 3.37
Equity valuation of OMSA & Curtis 6.0x
Price Performance
Island projects
Equity valuation of Logistics & Others 6.0x
1.6
Marine Base business
S$
1.2 Less: Net debt (1415) (1981) (1.24)
Less: To-be-funded capex of Liftboat
0.8
division (493) (690) (0.43)
0.4 Add: Potential "value accretive" invt. 0 0 0.00
Nov-14 Feb-15 May-15 Aug-15 Nov-15 Valuation 1931 2704 1.70
EZHL.SI share price (S$) Price Target 1.70
FTSTI (rebased)
YTD 1m 3m 12m Source: J.P. Morgan estimates.
Abs -42.8% -12.1% -14.4% -56.2%
Rel -29.6% -10.1% -9.0% -44.7%
Risks to Rating and Price Target
Downside risks to our rating and price target include: 1) rising gearing; 2) expanding
capital needs; 3) limited barriers to entry; and 4) yard delivery delays, which may
delay earnings.

Ezion Holdings Ltd (Reuters: EZHL.SI, Bloomberg: EZI SP)


Company Data $ in mn, year-end Dec FY12A FY13A FY14A FY15E FY16E
Shares O/S (mn) 1,315 Revenue ($ mn) 159 282 387 394 567
Market Cap ($ mn) 605 Net profit (reported) ($ mn) 80 160 224 129 235
Market Cap ($ mn) 605 Net Profit (rec) ($ mn) 65 133 207 113 218
Price (S$) 0.66 EPS (reported) ($) 0.05 0.13 0.14 0.08 0.15
Date Of Price 13 Nov 15 EPS (recurring) ($) 0.04 0.11 0.13 0.07 0.14
Free Float(%) - P/E (Recurring) 11.0 4.1 3.5 6.5 3.4
3M - Avg daily vol (mn) 21.19 P/BV (x) 1.6 0.8 0.7 0.6 0.5
3M - Avg daily val (S$ mn) 14.55 EV/EBITDA 20.8 12.0 7.2 9.0 5.7
FTSTI 2925.68 ROE 15.8% 19.7% 19.6% 8.3% 14.3%
Exchange Rate 1.42 Net debt to equity 75.5% 115.0% 85.7% 84.6% 74.6%
Price Target End Date 30-Dec-16 Source: Company data, Bloomberg, J.P. Morgan estimates.
Price Target (S$) 1.70

218
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Ezion Holdings Ltd: Summary of Financials


Income Statement Cash flow statement
$ in millions, year end Dec FY13 FY14 FY15E FY16E $ in millions, year end Dec FY13 FY14 FY15E FY16E
Revenues 282 387 394 567 Profit After tax 160 224 129 235
% change Y/Y 77.7% 37.1% 2.0% 43.9% Depreciation & amortization 45 103 129 153
Gross Profit 133 196 159 293 Change in working capital (5) (62) 4 (57)
Gross Margin 47.2% 50.7% 40.4% 51.6% Other non-cash items - - - -
EBITDA 165 317 265 421 Cash flow from operations 155 214 265 357
% change Y/Y 120.5% 92.5% (16.5%) 58.8% Capex (709) (458) (300) (300)
EBITDA Margin 58.5% 82.1% 67.1% 74.1% Net Acquisitions - - - -
EBIT 139 214 135 267 Other investing Cash flow (24) (62) 11 10
% change Y/Y 96.8% 54.4% (36.8%) 97.3% Cash flow from investments (733) (520) (289) (290)
EBIT Margin 42.4% 55.5% 34.4% 47.1% Free cash flow (547) (228) (11) 108
Net Interest (7) (17) (25) (53) a
Associates 31 28 23 28 Equity raised/(repaid) 97 268 0 0
Earnings before tax 163 226 133 242 Debt raised/(repaid) 599 290 210 210
% change Y/Y 96.9% 38.5% (40.9%) 81.3% Other (81) (27) (52) (79)
Tax (3) (2) (4) (7) Dividends paid (1) (1) (3) (5)
as % of EBT 1.6% 0.9% 3.0% 3.0% Cash flow from financing 615 530 155 126
Minority Interests 0 0 0 0 Net change in cash 32 206 131 192
Net income (reported) 160 224 129 235 Beginning cash 133 166 371 503
Net income (recurring) 133 207 113 218 Ending cash 166 371 503 695
% change Y/Y 104.9% 55.5% (45.5%) 93.2% DPS 0.00 0.00 0.00 0.00
Shares outstanding 1,197 1,591 1,593 1,593 a
Fully Diluted EPS 0.11 0.13 0.07 0.14 a
Balance sheet Ratio Analysis
$ in millions, year end Dec FY13 FY14 FY15E FY16E $ in millions, year end Dec FY13 FY14 FY15E FY16E
Cash and cash equivalents 166 372 503 695 Gross margin 47.2% 50.7% 40.4% 51.6%
Accounts receivable 107 160 157 225 EBITDA margin 58.5% 82.1% 67.1% 74.1%
Inventories 0 0 3 4 EBIT margin 42.4% 55.5% 34.4% 47.1%
Others 107 128 128 128 Net margin 47.3% 53.6% 28.6% 38.5%
Current assets 380 659 790 1,052 a
Net fixed assets 1,464 2,136 2,306 2,453 Sales growth 77.7% 37.1% 2.0% 43.9%
Other non-current assets 199 187 210 238 EBIT growth 96.8% 54.4% (36.8%) 97.3%
Total Assets 2,043 2,981 3,306 3,742 Recurring profit growth 104.9% 55.5% (45.5%) 93.2%
a Recurring EPS growth 166.8% 17.0% (45.6%) 93.2%
Short-term loans 223 288 288 288 a
Payables 69 70 74 87 Interest coverage (x) 24.2 19.0 10.6 7.9
Total current liabilities 376 427 432 444 Net debt to equity 115.0% 85.7% 84.6% 74.6%
Long-term debt 863 1,208 1,418 1,628 a
Other liabilities 4 33 33 33 Sales/assets 0.2 0.2 0.1 0.2
Total Liabilities 1,243 1,668 1,883 2,105 Assets/equity 2.4 2.4 2.3 2.3
Shareholders' equity 800 1,313 1,423 1,636 ROE 19.7% 19.6% 8.3% 14.3%
Total Liabilities and equity 2,043 2,981 3,306 3,742 ROCE 8.7% 9.9% 4.6% 7.8%
BVPS 0.59 0.69 0.76 0.89 a
Net Debt 920 1,125 1,203 1,221 a
Source: Company reports and J.P. Morgan estimates.

219
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

First Resources Limited


Overweight
www.first-resources.com
FRLD.SI,FR SP
Investment Thesis
Price: S$1.86
We are OW on FR with a Jun-16 PT of S$2.00. Within its space, FR remains
Price Target: S$2.00 continues to have one of the best fundamentals.
There is still much growth potential for upstream operations with 54% of
Singapore planted area comprising immature and young estates. Hence, 3-year FFB
Plantations production CAGR of 13% for FR over FY15/17E remains strongest among peers.
AC
Simone Yeoh Margins will also benefit from lower third party FFB purchases and FFB sales
(60-3) 2718-0710 as the groups mills (61% utilized in FY14) cater to rising volumes from Riau
simone.x.yeoh@jpmorgan.com
estates, and with the addition of new mills esp in Kalimantan Cash cost of
Bloomberg JPMA YEOH <GO>
JPMorgan Securities (Malaysia) Sdn. Bhd.
production though trending up over 2011/13 arising from its expansion/ presence
(1814ctr6-X) in Kalimantan is the lowest among peers at US$230/t for FY15E vs US$280-
James R. Sullivan, CFA US$350/t for peers under JPM coverage.
(65) 6882-2374 Strong financials with positive, rising FCFs and FY16E net gearing
james.r.sullivan@jpmorgan.com
estimated at 26% (after adjusting for IAS 16 accounting treatment for
Bloomberg JPMA SULLIVAN <GO>
J.P. Morgan Securities Singapore Private
biological assets), will facilitate the group's plans to continue to grow via
Limited acquisitions upstream.
While prospects for downstream refining business are challenging, contributions
Price Performance
2.2
are minimal at 2% of EBITDA in 1H15.
2.0 Valuation
S$ 1.8
We have applied a fair EV/ha of US$14,000 for FR translating to a Jun-16E PT of
1.6
S$2.00. This implies a 25-30% premium to average for peers (ex SIMP) and recent
1.4
brownfield plantation acquisitions in Indonesia (ranging at US$6,000-17,400/ha), fair
Nov-14 Feb-15 May-15 Aug-15 Nov-15

FRLD.SI share price (S$)


we believe given its stronger fundamentals. Adjusting for IAS 16, ROE for FR also
FTSTI (rebased) works out to an estimated 18% (vs 12%) about highest among JPM peers besides IOI
YTD 1m 3m 12m
Abs -0.3% 8.8% 3.6% -5.3% Corp, and our PT implies a FY16E PE of 17x, and P/B of 2.6x.
Rel 12.9% 10.8% 9.0% 6.2%
Risks to Rating and Price Target
1) Higher than expected CPO prices assuming the confirmation of a severe El Nino
impacting industry supply by 2016. 2) Better than expected CPO yields from the
groups young plantations. 3) Attractively priced acquisitions upstream.

First Resources Limited (Reuters: FRLD.SI, Bloomberg: FR SP)


Company Data $ in mn, year-end Dec FY13A FY14A FY15E FY16E FY17E
Shares O/S (mn) 1,584 Revenue ($ mn) 626 616 460 546 630
Market Cap (S$ mn) 2,946 Net Profit ($ mn) 238 173 122 153 179
Market Cap ($ mn) 2,070 EPS ($) 0.15 0.11 0.08 0.10 0.11
Price (S$) 1.86 DPS ($) 0.04 0.03 0.02 0.03 0.03
Date Of Price 13 Nov 15 Revenue growth (%) 3.8% (1.8%) (25.3%) 18.8% 15.4%
Free Float(%) 31.3% EPS growth (%) (1.6%) (27.2%) (29.7%) 25.5% 16.9%
3M - Avg daily vol (mn) 2.67 EPS Recurring Growth 0.5% (20.9%) (28.9%) 25.5% 16.9%
3M - Avg daily val (S$ mn) 4.56 ROE 19.7% 15.9% 10.5% 12.2% 13.1%
3M - Avg daily val ($ mn) 3.2 Adjusted P/E 9.5 12.1 17.0 13.5 11.6
FTSTI 2925.68 P/BV (x) 2.1 1.9 1.8 1.6 1.5
Exchange Rate 1.42 Dividend Yield 2.7% 2.1% 1.8% 2.2% 2.6%
Price Target End Date 30-Jun-16 Net Profit (Recurring) ($ mn) 217 172 122 153 179
Price Target (S$) 2.00 EPS (Recurring) ($) 0.14 0.11 0.08 0.10 0.11
Source: Company data, Bloomberg, J.P. Morgan estimates.

220
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

First Resources Limited: Summary of Financials


Income Statement Cash flow statement
$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E $ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E
Revenues 626 616 460 546 630 Profit before tax 314 252 168 211 260
% change Y/Y 3.8% (1.8%) (25.3%) 18.8% 15.4% Depr. & amortization 28 31 35 43 47
EBITDA 368 302 223 274 328 Change in working capital (50) 15 15 (8) (8)
% change Y/Y 2.7% (18.1%) (26.1%) 22.8% 19.8% Other non-cash items (92) (75) (41) (52) (73)
EBITDA Margin 58.8% 49.0% 48.5% 50.1% 52.0% Cash flow from operations 200 223 177 194 226
EBIT 341 271 188 231 281
% change Y/Y 2.2% (20.5%) (30.8%) 23.1% 21.5% Capex (182) (206) (170) (130) (130)
EBIT Margin 54.4% 44.0% 40.8% 42.3% 44.5% Disposal/(purchase) 0 0 0 0 0
Net Interest (18) (15) (16) (16) (16) Other (54) (8) 0 0 0
Earnings before tax 314 252 168 211 260 Cash flow from investing (236) (215) (170) (130) (130)
% change Y/Y (3.9%) (19.7%) (33.2%) 25.4% 23.2%
Tax (67) (71) (41) (52) (73) Equity raised/(repaid) 0 0 0 0 0
as % of EBT 21.5% 28.2% 24.5% 24.5% 28.2% Debt raised/(repaid) (36) 93 0 0 0
Minority Interest (8) (7) (5) (6) (8) Other (23) 7 0 0 0
Net income (reported) 238 173 122 153 179 Dividends paid (51) (58) (37) (46) (54)
% change Y/Y 0.5% (27.2%) (29.7%) 25.5% 16.9% Cash flow from financing (109) 43 (37) (46) (54)
Net Profit (Recurring) 217 172 122 153 179 Net change in cash (145) 51 (29) 18 42
Shares outstanding 1,584 1,584 1,584 1,584 1,584 Beginning cash 405 272 351 321 339
EPS (reported) 0.15 0.11 0.08 0.10 0.11 Ending cash 272 351 321 339 382
Free cash flow 33 28 19 76 108
DPS 0.04 0.03 0.02 0.03 0.03
Balance sheet Ratio Analysis
$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E $ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E
Cash 272 351 321 339 382 EBITDA margin 58.8% 49.0% 48.5% 50.1% 52.0%
Accounts receivable 35 30 22 26 30 Operating margin 54.4% 44.0% 40.8% 42.3% 44.5%
Inventories 59 49 36 43 50 Net profit margin 34.6% 27.9% 26.5% 28.1% 28.4%
Others 44 46 46 46 46 SG&A/Sales 11.0% 8.6% - - -
Current assets 410 475 426 455 508
LT investments - - - - - Sales growth 3.8% (1.8%) (25.3%) 18.8% 15.4%
Net fixed assets 1,172 1,299 1,499 1,586 1,669 EBIT growth 2.2% (20.5%) (30.8%) 23.1% 21.5%
Total Assets 1,780 1,998 2,148 2,264 2,400 Net profit growth 0.5% (27.2%) (29.7%) 25.5% 16.9%
EPS growth (1.6%) (27.2%) (29.7%) 25.5% 16.9%
Short-term loans 3 11 11 11 11
Payables 24 20 15 18 21 Interest coverage (x) 20.1 20.1 13.6 16.8 20.1
Others 53 57 57 57 57 Net debt to equity 20.9% 20.8% 21.8% 18.6% 14.0%
Total current liabilities 80 88 83 86 89
Long-term debt 487 572 572 572 572 Sales/assets 0.3 0.3 0.2 0.2 0.3
Other liabilities 173 222 292 298 306 Assets/equity 168.9% 175.2% 179.0% 175.8% 170.1%
Total Liabilities 740 882 947 956 966 ROE 19.7% 15.9% 10.5% 12.2% 13.1%
Shareholder's equity 1,040 1,116 1,201 1,308 1,434 ROCE 16.6% 12.0% 8.1% 9.5% 10.3%
Total Liabilities & equity 1,780 1,998 2,148 2,264 2,400
BVPS ($) 0.63 0.67 0.73 0.79 0.87
Source: Company reports and J.P. Morgan estimates.

221
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Singapore Airlines
Overweight
www.singaporeair.com
SIAL.SI,SIA SP
Investment Thesis
Price: S$10.83
We expect industry demand-supply growth to improve at end-2015, driving the sector
Price Target: S$13.50
and SIAs earnings recovery. Net cash still amounts to 27% of current market cap, and
we estimate SIAs liquidation value at S$14/share. If SIA paid out one-third of its
Singapore current net cash balance, the yield would be 9%. Alternatively, we think it could partly
Airlines divest its stake in SIA Eng via a dividend in specie to help facilitate SIA Engs
AC
Corrine Png acquisition of more third-party airline MRO work. Reducing its 78% stake in SIA Eng
(65) 6882-1514 to 51% would imply a 9% yield. Stay OW.
corrine.ht.png@jpmorgan.com
Bloomberg JPMA PNG <GO>
Valuation
J.P. Morgan Securities Singapore Private
Limited Our Dec-16 price target of S$13.50 is based on 1.2x P/BV, close to SIAs historical
average valuation over the past 10 years. This is supported by SIAs "liquidation"
Price Performance
value of c.$14/share. This is supported by our Gordon Growth valuation of 1.2x P/B,
13
12
assuming a 7% ROE, a 6% cost of equity and 0% long-term growth.
11
S$
10 Risks to Rating and Price Target
9
8
Key downside risks: (1) Singapores economic growth stalls; (2) a sharp rebound in
Nov-14 Feb-15 May-15 Aug-15 Nov-15 fuel prices; (3) worse-than-expected competition from low-cost carriers and Middle
SIAL.SI share price (S$) Eastern carriers; (4) greater-than-expected losses from airline investments; and (5) a
FTSTI (rebased)
YTD 1m 3m 12m weaker Singapore dollar.
Abs -6.2% -1.7% 6.4% 4.9%
Rel 7.0% 0.3% 11.8% 16.4%

Singapore Airlines (Reuters: SIAL.SI, Bloomberg: SIA SP)


Company Data S$ in mn, year-end Mar FY14A FY15A FY16E FY17E FY18E
Shares O/S (mn) 1,172 Revenue (S$ mn) 15,244 15,566 15,138 15,648 17,347
Market Cap (S$ mn) 12,687 Net Profit (S$ mn) 360 368 592 1,004 1,048
Market Cap ($ mn) 8,912 EPS (S$) 0.31 0.31 0.51 0.86 0.89
Price (S$) 10.83 DPS (S$) 0.46 0.22 0.40 0.69 0.72
Date Of Price 13 Nov 15 Revenue growth (%) 1.0% 2.1% (2.7%) 3.4% 10.9%
Free Float(%) 43.8% EPS growth (%) (5.2%) 3.1% 60.5% 69.6% 4.4%
3M - Avg daily vol (mn) 1.42 ROCE 1.6% 2.6% 3.4% 5.9% 5.5%
3M - Avg daily val (S$ mn) 14.89 ROE 2.7% 2.9% 4.7% 7.8% 7.9%
3M - Avg daily val ($ mn) 10.5 P/E (x) 35.4 34.4 21.4 12.6 12.1
FTSTI 2925.68 P/BV (x) 1.0 1.0 1.0 1.0 1.0
Exchange Rate 1.42 EV/EBITDA (x) 5.2 5.2 4.8 3.9 4.0
Price Target End Date 31-Dec-16 Dividend Yield 4.2% 2.0% 3.7% 6.3% 6.6%
Source: Company data, Bloomberg, J.P. Morgan estimates.

320
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Singapore Airlines: Summary of Financials


Income Statement Cash flow statement
S$ in millions, year end Mar FY14 FY15 FY16E FY17E FY18E S$ in millions, year end Mar FY14 FY15 FY16E FY17E FY18E
Revenues 15,244 15,566 15,138 15,648 17,347 EBIT 259 409 576 1,065 1,082
% change Y/Y 1.0% 2.1% (2.7%) 3.4% 10.9% Depr. & amortization 1,576 1,539 1,690 1,896 2,160
EBITDA 1,835 1,948 2,266 2,960 3,242 Change in working capital 178 (118) (69) 82 274
% change Y/Y 0.9% 6.2% 16.3% 30.6% 9.5% Taxes - - - - -
EBIT 259 409 576 1,065 1,082 Cash flow from operations 2,098 2,067 2,119 2,859 3,303
% change Y/Y 13.1% 57.9% 40.8% 84.7% 1.6%
EBIT Margin 1.7% 2.6% 3.8% 6.8% 6.2% Capex (2,575) (2,600) (2,900) (3,100) (4,450)
Net Interest 25 25 27 (10) (42) Disposal/(purchase) 809 998 200 200 200
Earnings before tax 368 443 732 1,214 1,255 Net Interest 25 25 27 (10) (42)
% change Y/Y (21.7%) 20.4% 65.3% 65.9% 3.3% Other 223 70 30 56 112
Tax 57 (36) (103) (169) (162) Free cash flow 275 462 (552) 16 (836)
as % of EBT 15.4% 8.2% 14.0% 13.9% 12.9%
Net income (reported) 360 368 592 1,004 1,048 Equity raised/(repaid) - - - - -
% change Y/Y (5.1%) 2.3% 60.9% 69.6% 4.4% Debt raised/(repaid) (53) 852 500 500 2,000
Shares outstanding 1,177 1,168 1,172 1,172 1,172 Other (80) (463) 99 103 103
EPS (reported) 0.31 0.31 0.51 0.86 0.89 Dividends paid (318) (481) (357) (583) (815)
% change Y/Y (5.2%) 3.1% 60.5% 69.6% 4.4% Beginning cash 5,060 4,884 5,254 4,945 4,980
Ending cash 4,884 5,254 4,945 4,980 5,433
DPS 0.46 0.22 0.40 0.69 0.72
Balance sheet Ratio Analysis
S$ in millions, year end Mar FY14 FY15 FY16E FY17E FY18E S$ in millions, year end Mar FY14 FY15 FY16E FY17E FY18E
Cash and cash equivalents 4,884 5,254 4,945 4,980 5,433 EBITDA margin 12.0% 12.5% 15.0% 18.9% 18.7%
Accounts receivable 1,762 1,655 1,609 1,664 1,844 Operating margin 1.7% 2.6% 3.8% 6.8% 6.2%
Inventories 243 202 196 203 225 Net margin 2.4% 2.4% 3.9% 6.4% 6.0%
Others 134 185 185 185 185
Current assets 7,311 7,465 7,105 7,201 7,857
. Sales per share growth 0.8% 2.8% (3.0%) 3.4% 10.9%
LT investments 1,125 1,125 1,125 1,125 1,125 Sales growth 1.0% 2.1% (2.7%) 3.4% 10.9%
Net fixed assets 13,027 13,523 14,533 15,537 17,627 Net profit growth (5.1%) 2.3% 60.9% 69.6% 4.4%
Total Assets 22,643 23,921 24,573 25,679 28,434 EPS growth (5.2%) 3.1% 60.5% 69.6% 4.4%
.
Liabilities Interest coverage (x) NM NM NM 304.5 76.7
Short-term loans 61 447 447 447 447
Payables 4,424 4,371 4,251 4,394 4,872 Net debt to equity (29.6%) (27.6%) (20.7%) (16.5%) (4.6%)
Others 907 1,964 1,964 1,964 1,964 Sales/assets 0.7 0.7 0.6 0.6 0.6
Total current liabilities 5,391 6,783 6,663 6,806 7,283 Assets/equity 171.2% 181.2% 192.7% 194.6% 204.4%
. ROE 2.7% 2.9% 4.7% 7.8% 7.9%
Long-term debt 904 1,370 1,870 2,370 4,370 ROCE 1.6% 2.6% 3.4% 5.9% 5.5%
Other liabilities 2,772 2,839 2,839 2,839 2,839
Total Liabilities 9,068 10,991 11,371 12,014 14,491
Shareholder's equity 13,575 12,930 13,202 13,664 13,942
BVPS (S$) 11.25 10.67 10.84 11.20 11.40
Source: Company reports and J.P. Morgan estimates.

321
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Singapore Exchange
Overweight
www.sgx.com
SGXL.SI,SGX SP
Investment Thesis
Price: S$7.55
We maintain OW on SGX, as we see 28 cents of DPS as secure. Steady dividends, a
Price Target: S$8.00
lack of balance sheet risks and stable revenues are likely to drive the stocks
performance, in our view. We expect cash volumes to stay range-bound and
Singapore derivatives volumes to experience a slowdown. However, a good mix of major
Specialty Finance contracts (Nikkei, Nifty, A50, etc.) should ensure that overall turnover remains
AC
Harsh Wardhan Modi resilient.
(65) 6882- 2450
harsh.w.modi@jpmorgan.com Valuation
Bloomberg JPMA MODI <GO>
The stock trades at a 21.0x dynamic P/E, 0.5 s.d. below the mean P/E of 22.3x. Our
J.P. Morgan Securities Singapore Private
Limited Dec-16 PT of S$8 is based on the mean dynamic P/E.

Price Performance
Risks to Rating and Price Target
9.0
Downside risks include lower-than-expected volumes, lower-than-expected revenues,
8.0
S$
higher-than-expected opex and a value-eroding deal.
7.0

6.0
Nov-14 Feb-15 May-15 Aug-15 Nov-15
SGXL.SI share price (S$)
FTSTI (rebased)
YTD 1m 3m 12m
Abs -2.5% 2.9% -0.3% 4.9%
Rel 10.7% 4.9% 5.1% 16.4%

Singapore Exchange Ltd (Reuters: SGXL.SI, Bloomberg: SGX SP)


Company Data S$ in mn, year-end Jun FY12A FY13A FY14A FY15A FY16E FY17E
52-week Range (S$) 8.80-7.02 Revenue (S$ mn) 648 715 687 779 853 924
Market Cap (S$ mn) 8,084 Net Profit (S$ mn) 292 336 320 349 369 418
Market Cap ($ mn) 5,678 EPS (S$) 0.27 0.31 0.30 0.33 0.34 0.39
Shares O/S (mn) 1,071 DPS (S$) 0.27 0.28 0.28 0.28 0.28 0.34
3M - Avg daily vol (mn) 2.94 Dividend Yield 3.6% 3.7% 3.7% 3.7% 3.7% 4.5%
3M - Avg daily val (S$ mn) 21.84 Revenue growth (%) (1.9%) 10.4% (4.0%) 13.4% 9.5% 8.3%
3M - Avg daily val ($ mn) 15.3 EPS growth (%) (1.2%) 15.0% (4.7%) 8.7% 5.9% 12.9%
Price (S$) 7.55 ROE 35.2% 39.0% 35.4% 36.7% 38.2% 41.0%
Date Of Price 13 Nov 15 P/E (x) 27.6 24.0 25.2 23.2 21.9 19.4
FTSTI 2925.68 P/BV (x) 9.7 9.1 8.8 8.3 8.5 7.6
Exchange Rate 1.42 Source: Company data, Bloomberg, J.P. Morgan estimates.
Price Target End Date 31-Dec-16

322
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Singapore Exchange: Summary of Financials


Income Statement Cash flow statement
S$ in millions, year end Jun FY14 FY15 FY16E FY17E FY18E S$ in millions, year end Jun FY14 FY15 FY16E FY17E FY18E
Revenues 687 779 853 924 - EBIT 377 410 438 495 -
% change Y/Y (4.0%) 13.4% 9.5% 8.3% - Depr. & amortization 46 57 64 67 -
EBITDA 422 467 502 563 - Change in working capital 429 475 507 566 -
% change Y/Y (5.1%) 10.6% 7.5% 12.1% - Taxes (75) (64) (70) (80) -
EBIT 377 410 438 495 - Cash flow from operations 359 429 476 468 -
% change Y/Y (6.9%) 8.8% 7.0% 13.0% -
EBIT Margin 54.8% 52.6% 51.4% 53.6% - Capex (72) (101) (101) (101) -
Net Interest - - - - - Disposal/(purchase) 0 0 0 0 -
Earnings before tax 379 412 440 497 - Net Interest - - - - -
% change Y/Y (7.1%) 8.6% 6.9% 13.0% - Other 7 6 8 10 -
Tax (59) (63) (70) (80) - Free cash flow 287 328 375 367 -
as % of EBT 15.5% 15.3% 16.0% 16.0% -
Net income (reported) 320 349 369 418 - Equity raised/(repaid) 0 0 0 0 -
% change Y/Y (4.6%) 8.8% 6.0% 13.0% - Debt raised/(repaid) - - - - -
Shares outstanding 1,070 1,071 1,071 1,072 - Other 0 (8) (12) (12) -
EPS (reported) 0.30 0.33 0.34 0.39 - Dividends paid (300) (300) (386) (301) -
% change Y/Y (4.7%) 8.7% 5.9% 12.9% - Beginning cash 613 607 640 625 -
Ending cash 607 633 625 689 -
DPS 0.28 0.28 0.28 0.34 -
Balance sheet Ratio Analysis
S$ in millions, year end Jun FY14 FY15 FY16E FY17E FY18E S$ in millions, year end Jun FY14 FY15 FY16E FY17E FY18E
Cash and cash equivalents 757 790 775 839 - EBITDA margin 61.5% 59.9% 58.9% 60.9% -
Accounts receivable 572 654 716 775 - Operating margin 54.8% 52.6% 51.4% 53.6% -
Inventories - - - - - Net margin 46.7% 44.8% 43.3% 45.2% -
Others 60 60 60 60 -
Current assets 1,389 1,504 1,551 1,674 -
Sales per share growth - - - - -
LT investments 78 60 60 60 - Sales growth - - - - -
Net fixed assets 61 61 65 68 - Net profit growth (4.6%) 8.8% 6.0% 13.0% -
Total Assets 1,641 1,802 1,886 2,043 - EPS growth (4.7%) 8.8% 5.8% 12.8% -
Interest coverage (x) - - - - -
Liabilities
Short-term loans 0 0 0 0 - Net debt to equity (82.1%) (80.9%) (80.8%) (78.0%) -
Payables 621 720 812 842 - Sales/assets 0.40 0.45 0.46 0.47 -
Others 83 86 95 107 - Assets/equity 1.90 1.81 1.90 1.93 1.90
Total current liabilities 704 806 908 948 - ROE 35.4% 36.7% 38.2% 41.0% -
Long-term debt 0 0 0 0 - ROCE 35.2% 36.6% 38.0% 40.9% -
Other liabilities 15 19 19 19 -
Total Liabilities 719 825 927 967 -
Shareholder's equity 922 976 960 1,076 -
BVPS 0.86 0.91 0.89 1.00 -
Source: Company reports and J.P. Morgan estimates.

323
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

ST Engineering
Overweight
www.stengg.com
STEG.SI,STE SP
Investment Thesis
Price: S$2.98
We remain buyers as we believe ST Engineering's valuations are attractive (22%
Price Target: S$4.30
below peak even though its order book remains high) given its higher profitability
(ROE 24% in 2015E). Key catalysts: 1) orderbook of $12.2B (-8% y/y, -2% q/q)
Singapore still relatively high by historical standards, 2) lower fuel prices should help boost
Defense aircraft utilization and MRO demand, 3) more contract wins, 4) stronger USD, 5)
AC
Corrine Png improving operating efficiency, 6) industry M&A.
(65) 6882-1514
corrine.ht.png@jpmorgan.com Valuation
Bloomberg JPMA PNG <GO>
Our Dec-16 price target of S$4.30 is based on our DDM valuation methodology,
J.P. Morgan Securities Singapore Private
Limited assuming 88% dividend payout ratio, 5.6% cost of equity and 2.0% long-term
growth. Our PT implies a P/E of 24x which is 1 standard deviation above its
Price Performance
historical average valuation in the past 15 years, supported by ST Engineering's high
3.8 orderbook. This is also supported by our sum-of-the-parts valuation of S$4.20.
3.4
S$
3.0
Risks to Rating and Price Target
2.6
Key downside risks: 1) weaker-than-expected air travel demand resulting in airline
Nov-14 Feb-15 May-15 Aug-15 Nov-15 capacity reductions and MRO demand, 2) order book momentum stalls, 3) increased
STEG.SI share price (S$) bad debt provisions, 4) wage pressure and 5) volatile SGD/USD.
FTSTI (rebased)
YTD 1m 3m 12m
Abs -12.6% -5.4% -7.7% -14.1%
Rel 0.6% -3.4% -2.3% -2.6%

ST Engineering Ltd (Reuters: STEG.SI, Bloomberg: STE SP)


Company Data S$ in mn, year-end Dec FY13A FY14A FY15E FY16E FY17E
Shares O/S (mn) 3,118 Revenue (S$ mn) 6,633 6,539 6,046 6,333 6,707
Market Cap (S$ mn) 9,292 Net Profit (S$ mn) 581 532 515 550 597
Market Cap ($ mn) 6,527 EPS (S$) 0.19 0.17 0.17 0.18 0.19
Price (S$) 2.98 DPS (S$) 0.15 0.15 0.15 0.16 0.17
Date Of Price 13 Nov 15 Revenue growth (%) 4.0% (1.4%) (7.5%) 4.7% 5.9%
Free Float(%) 49.8% EPS growth (%) (0.2%) (8.9%) (3.0%) 6.9% 8.5%
3M - Avg daily vol (mn) 3.45 ROCE 16.4% 13.8% 13.7% 14.2% 15.2%
3M - Avg daily val (S$ mn) 10.45 ROE 29.0% 25.0% 23.8% 24.7% 26.0%
3M - Avg daily val ($ mn) 7.3 P/E (x) 15.9 17.5 18.0 16.8 15.5
FTSTI 2925.68 P/BV (x) 4.4 4.4 4.2 4.1 4.0
Exchange Rate 1.42 EV/EBITDA (x) 12.3 14.1 14.1 13.5 12.7
Price Target End Date 31-Dec-16 Dividend Yield 5.1% 5.0% 4.9% 5.2% 5.7%
Source: Company data, Bloomberg, J.P. Morgan estimates.

328
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

ST Engineering: Summary of Financials


Income Statement Cash flow statement
S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E
Revenues 6,633 6,539 6,046 6,333 6,707 EBIT 673 555 530 567 620
% change Y/Y 4.0% (1.4%) (7.5%) 4.7% 5.9% Depr. & amortization 127 154 166 168 170
EBITDA 800 709 696 735 789 Change in working capital 1,886 1,539 744 (43) (56)
% change Y/Y 2.4% (11.4%) (1.9%) 5.6% 7.5% Taxes - - - - -
EBIT 673 555 530 567 620 Cash flow from operations 930 624 1,424 675 710
% change Y/Y 2.3% (17.6%) (4.5%) 7.0% 9.3%
EBIT Margin 10.1% 8.5% 8.8% 9.0% 9.2% Capex (282) (224) (256) (268) (283)
Net Interest (9) (2) 8 11 10 Disposal/(purchase) 10 5 5 5 5
Earnings before tax 730 651 628 672 729 Net Interest (9) (2) 8 11 10
% change Y/Y 2.0% (10.8%) (3.4%) 6.9% 8.6% Other 14 62 (400) 0 0
Tax (138) (114) (109) (116) (126) Free cash flow 672 467 773 412 432
as % of EBT 18.9% 17.5% 17.3% 17.3% 17.3%
Net income (reported) 581 532 515 550 597 Equity raised/(repaid) 52 17 0 0 0
% change Y/Y 0.8% (8.4%) (3.2%) 6.9% 8.5% Debt raised/(repaid) 29 (392) 50 0 0
Shares outstanding 3,101 3,118 3,110 3,110 3,110 Other (30) (52) 0 0 0
EPS (reported) 0.19 0.17 0.17 0.18 0.19 Dividends paid (521) (499) (453) (484) (526)
% change Y/Y (0.2%) (8.9%) (3.0%) 6.9% 8.5% Beginning cash 1,712 1,930 1,471 1,646 1,579
Ending cash 1,930 1,471 1,646 1,579 1,491
DPS 0.15 0.15 0.15 0.16 0.17
Balance sheet Ratio Analysis
S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E
Cash and cash equivalents 1,930 1,471 1,646 1,579 1,491 EBITDA margin 12.1% 10.8% 11.5% 11.6% 11.8%
Accounts receivable 1,222 1,319 1,030 1,079 1,143 Operating margin 10.1% 8.5% 8.8% 9.0% 9.2%
Inventories 1,808 1,802 1,486 1,556 1,648 Net margin 8.8% 8.1% 8.5% 8.7% 8.9%
Others 802 734 734 734 734
Current assets 5,761 5,326 4,896 4,948 5,016
. Sales per share growth 3.0% (2.0%) (7.3%) 4.7% 5.9%
LT investments 166 127 527 527 527 Sales growth 4.0% (1.4%) (7.5%) 4.7% 5.9%
Net fixed assets 1,520 1,578 1,657 1,747 1,851 Net profit growth 0.8% (8.4%) (3.2%) 6.9% 8.5%
Total Assets 8,707 8,319 8,369 8,511 8,682 EPS growth (0.2%) (8.9%) (3.0%) 6.9% 8.5%
.
Liabilities Interest coverage (x) 91.0 430.7 - - -
Short-term loans 434 75 275 275 275
Payables 1,605 1,667 1,605 1,681 1,781 Net debt to equity (24.7%) (20.0%) (24.8%) (21.3%) (17.1%)
Others 2,055 1,974 1,974 1,974 1,974 Sales/assets 0.8 0.8 0.7 0.8 0.8
Total current liabilities 4,094 3,716 3,854 3,930 4,030 Assets/equity 417.3% 400.8% 385.8% 379.0% 374.5%
. ROE 29.0% 25.0% 23.8% 24.7% 26.0%
Long-term debt 939 944 794 794 794 ROCE 16.4% 13.8% 13.7% 14.2% 15.2%
Other liabilities 1,414 1,395 1,395 1,395 1,395
Total Liabilities 6,447 6,055 6,043 6,119 6,218
Shareholder's equity 2,260 2,265 2,326 2,392 2,464
BVPS (S$) 0.68 0.68 0.71 0.73 0.75
Source: Company reports and J.P. Morgan estimates.

329
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Stocks to Avoid

367
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Genting Singapore
Underweight
www.gentinginternational.com
GENS.SI,GENS SP
Investment Thesis
Price: S$0.78
GENS share price has rebounded by 14% since the September 28 trough (Strait
Price Target: S$0.70
Times Index up by 6% during the same period) due to the false hope of improving
demand, especially after a strong MBS 3Q result. However, the disappointing 3Q
Singapore number of GENS has proved market expectations wrong. Looking forward, we
Gaming expect GENS to continue the market share loss trend in the no growth Singapore
AC
Daisy Lu market, while margin also sees pressure as bad debt expense stays afloat. We expect
(852) 2800-8593 the Street to cut estimates and are c.10%/16% below FY16E and 17E consensus
daisy.y.lu@jpmorgan.com EBITDA/net profit. Reiterate UW.
Bloomberg JPMA DLU <GO>
J.P. Morgan Securities (Asia Pacific) Limited
Valuation
James R. Sullivan, CFA
(65) 6882-2374
Our Jun-16 PT of S$0.70 is based on DCF, assumes a 1.0% terminal growth rate and
james.r.sullivan@jpmorgan.com a WACC of 8.5% and implies 21x 2016E P/E. We do not include the Jeju project or
Bloomberg JPMA SULLIVAN <GO> Japan in our valuation.
J.P. Morgan Securities Singapore Private
Limited
Risks to price target
Price Performance Upside risks include: (1) an overall Macau sector rally that may boost sentiment and
1.2 drive up GENSs share price; (2) stronger-than-expected macroeconomic growth in
1.1
China and the South East Asian region; and (3) quicker-than-expected progress on
1.0
S$
0.9
Japan and Jeju Island development.
0.8
0.7
Nov-14 Feb-15 May-15 Aug-15 Nov-15

GENS.SI share price (S$)


FTSTI (rebased)
YTD 1m 3m 12m
Abs -27.1% 0.0% -0.6% -24.6%
Rel -13.9% 2.0% 4.8% -13.1%

Genting Singapore (Reuters: GENS.SI, Bloomberg: GENS SP)


Company Data S$ in mn, year-end Dec FY13A FY14A FY15E FY16E FY17E
52-week Range (S$) 1.17-0.70 Revenue (S$ mn) 2,847 2,862 2,535 2,760 2,852
Market Cap (S$ mn) 9,432 EBITDA (S$ mn) 1,158 1,158 937 962 1,011
Market Cap ($ mn) 6,625 Net Profit (S$ mn) 708 635 236 523 579
Shares O/S (mn) 12,092 EPS (S$) 0.05 0.04 0.01 0.03 0.04
Price (S$) 0.78 DPS (S$) 0.01 0.01 0.01 0.01 0.01
Date Of Price 13 Nov 15 ROE 6.3% 5.3% 1.2% 4.0% 4.4%
3M - Avg daily vol (mn) 24.28 P/E (x) 16.2 18.5 80.1 23.4 20.5
3M - Avg daily val (S$ mn) 18.89 Dividend Yield 1.3% 1.3% 1.3% 1.3% 1.3%
Exchange Rate 1.42 EV/EBITDA (x) 8.2 7.7 9.5 9.2 8.8
FTSTI 2925.68 EBITDA Margin 40.7% 40.5% 37.0% 34.9% 35.4%
Price Target End Date 30-Jun-16 Adjusted Diluted NP (S$ mn) 590 517 118 405 460
Price Target (S$) 0.70 Source: Company data, Bloomberg, J.P. Morgan estimates.

406
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Genting Singapore: Summary of Financials


Profit and Loss Statement Balance Sheet
S$ in millions, year end Dec FY14 FY15E FY16E FY17E S$ in millions, year end Dec FY14 FY15E FY16E FY17E
Reported revenue 2,862 2,535 2,760 2,852 Cash and cash equivalents 3,697 4,412 4,661 4,936
(Other operating expenses) (1,704) (1,598) (1,798) (1,841) Short term investment 1,314 500 525 551
EBITDA 1,158 937 962 1,011 Receivable 1,101 773 889 1,022
(D&A) (419) (341) (317) (308) Inventories 54 56 59 62
EBIT 739 597 645 703 Other current assets 139 139 139 139
Net interest income / (expense) 8 7 15 25 Current assets 6,305 5,881 6,273 6,711
Other income / (expense) - - - - Net fixed assets 5,809 5,690 5,514 5,347
Pretax income 805 288 638 706 Intangibles and goodwill 119 98 77 56
(Income tax) (170) (52) (115) (127) Other non-current assets 439 606 637 669
Minority interest 0 0 0 0 Total assets 12,672 12,275 12,500 12,783
Discontinued operations 0 0 0 0 a.
Net Income 517 118 405 460 Payables 596 433 433 433
Short-term debt 518 164 164 164
Shares Outstanding (Millions) 12,274 12,120 12,120 12,120 Others 428 163 172 180
Current liabilities 1,542 760 768 777
EPS (S$) 0.04 0.01 0.03 0.04 Long-term debt 1,184 1,438 1,238 1,038
DPS (S$) 0.01 0.01 0.01 0.01 Other long-term liabilities 243 255 267 281
Payout ratio 24% 103% 30% 26% Total liabilities 2,969 2,453 2,274 2,096
Minority interests (MI) 0 0 0 0
Shareholders' equity 9,703 9,821 10,226 10,687
o/w Holders of perpetuity bond 2,308 2,308 2,308 2,308
. Shareholders' equity and MI 9,703 9,821 10,226 10,687
.
Gross debt 1,702 1,602 1,402 1,202
. Net Debt/(cash) (1,140) (1,141) (1,614) (2,116)
.
BVPS (S$) 0.80 0.81 0.85 0.88
.
Cashflow Statement Ratio Analysis
S$ in millions, year end Dec FY14 FY15E FY16E FY17E S$ in millions, year end Dec FY14 FY15E FY16E FY17E
Net profit 635 236 523 579 Revenue growth 0.5% (11.4%) 8.9% 3.3%
Depreciation & amortization 419 341 317 308 EBITDA growth 0.0% (19.1%) 2.6% 5.0%
(Change in working capital) (351) 711 (135) (154) EBIT growth 0.3% (19.2%) 8.1% 8.9%
Others 82 (52) (115) (127) EPS growth (12.4%) (76.9%) 243.0% 13.7%
Cashflow from operations 956 1,288 705 733
. EBITDA margin 40.5% 37.0% 34.9% 35.4%
Capex (195) (200) (120) (120) EBIT margin 25.8% 23.5% 23.4% 24.6%
Maintenance (98) (100) (120) (120) Net margin 18.1% 4.7% 14.7% 16.1%
Expansionary (98) (100) 0 0
Others 265 (155) (18) (19) P/E (x) 18.5 80.1 23.4 20.5
Cashflow from investments 69 (355) (138) (139) EV/EBITDA (x) 7.7 9.5 9.2 8.8
. Dividend yield 1.3% 1.3% 1.3% 1.3%
Change in borrowings (525) (100) (200) (200) FCF yield 7.9% 11.5% 6.2% 6.5%
Others (458) (118) (118) (118) Adjusted eFCF yield 7.3% 12.1% 5.1% 5.4%
Cashflow from financing (982) (218) (318) (318) Price/BV (x) 1.0 1.0 0.9 0.9
.
Free cashflows (FCF) 760 1,088 585 613 Net debt to equity (x) NM NM NM NM
YoY change 77.3% 43.1% (46.3%) 4.8% Interest coverage (x) NM NM NM NM
Adjusted eFCF (ex-expansion capex) 697 1,143 484 510 ROE 5.3% 1.2% 4.0% 4.4%
YoY change 96.7% 64.0% (57.6%) 5.3% Cash ROIC (EBITDA/invested capital) 68.5% 44.9% 97.1% 88.1%
Source: Company reports and J.P. Morgan estimates.

407
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Sembcorp Marine
Underweight
www.sembcorpmarine.com.sg
SCMN.SI,SMM SP
Investment Thesis
Price: S$2.21
We are Underweight on SMM, as margins have continued to disappoint and earnings
Price Target: S$2.00
remain muted. Execution risk remains in Brazil for its Sete Brasil orders, with cost
overruns a possibility. SMM also has lower JU order wins (as a percentage of total
Singapore order book) in its portfolio, which are higher-margin jobs.
Ship Building & Repairs
AC
Ajay Mirchandani Valuation
(65) 6882-2419 Our SOTP-based Dec-16 PT of S$2.00 consists of: 1) a DCF valuation for the
ajay.mirchandani@jpmorgan.com
existing orderbook; 2) a 6x P/E multiple on FY16E ship repair earnings; and 3) a
Bloomberg JPMA MIRCHANDANI <GO>
DCF valuation for offshore conversion.
J.P. Morgan Securities Singapore Private
Limited
Risks to Rating and Price Target
Price Performance
Key upside risks to our price target include a better-than-expected order book
3.6 outlook; better-than-expected margins; and better-than-expected execution at the
3.2
S$
upcoming Brazil yard.
2.8
2.4

2.0
Nov-14 Feb-15 May-15 Aug-15 Nov-15
SCMN.SI share price (S$)
FTSTI (rebased)
YTD 1m 3m 12m
Abs -32.8% -16.0% -15.6% -37.0%
Rel -19.6% -14.0% -10.2% -25.5%

Sembcorp Marine Ltd (Reuters: SCMN.SI, Bloomberg: SMM SP)


Company Data S$ in mn, year-end Dec FY12A FY13A FY14A FY15E FY16E
Shares O/S (mn) 2,089 Revenue (S$ mn) 4,430 5,526 5,833 4,957 5,134
Market Cap (S$ mn) 4,616 Net Profit (recurring) (S$ mn) 462 550 560 380 400
Market Cap ($ mn) 3,242 EPS (Recurring) (S$) 0.22 0.26 0.27 0.18 0.19
Price (S$) 2.21 EPS (Recurring) Growth (28.7%) 18.8% 1.8% (32.1%) 5.2%
Date Of Price 13 Nov 15 DPS (S$) 0.13 0.13 0.13 0.07 0.08
Free Float(%) - P/E (Recurring) 10.0 8.4 8.3 12.2 11.6
3M - Avg daily vol (mn) 2.52 ROE (%) 19.1% 21.5% 19.8% 12.4% 12.1%
3M - Avg daily val (S$ mn) 6.09 Dividend Yield 5.9% 5.9% 5.9% 3.1% 3.8%
FTSTI 2925.68 P/BV (x) 1.9 1.7 1.6 1.4 1.4
Exchange Rate 1.42 BV per share (S$) 1.17 1.28 1.42 1.52 1.63
Price Target End Date 30-Dec-16 Source: Company data, Bloomberg, J.P. Morgan estimates.
Price Target (S$) 2.00

460
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Sembcorp Marine: Summary of Financials


Income Statement Cash flow statement
S$ in millions, year end Dec FY13 FY14 FY15E FY16E S$ in millions, year end Dec FY13 FY14 FY15E FY16E
Revenues 5,526 5,833 4,957 5,134 EBIT 644 707 517 515
EBITDA 742 818 683 697 Depreciation & amortization 97 111 167 183
% change Y/Y 15.0% 10.3% (16.5%) 2.1% Change in working capital 243 (1,250) (90) (27)
EBITDA Margin 13.4% 14.0% 13.8% 13.6% Other non-cash items (47) (76) (101) (108)
EBIT 644 707 517 515 Cash flow from operations 937 (508) 493 563
% change Y/Y 16.2% 9.7% (26.9%) (0.4%) Capex (797) (738) (400) (400)
EBIT Margin 11.7% 12.1% 10.4% 10.0% Others (1) (32) 2 2
Net Interest 0 (11) (21) (27) Cash flow from investments (798) (770) (398) (398)
Associates 16 10 (25) 11 Free cash flow 140 (1,237) 111 186
Exceptionals 0 0 (17) 0
Earnings before tax 665 707 456 501 Equity raised/(repaid) (20) (11) 0 0
% change Y/Y 5.6% 6.3% (35.6%) 10.0% Debt raised/(repaid) 438 964 0 0
Tax (77) (106) (76) (82) Other (12) (13) 0 0
as % of EBT 11.5% 15.0% 16.6% 16.5% Dividends paid (272) (272) (142) (175)
Minority Interests (33) (41) (17) (19) Cash flow from financing 135 668 (142) (175)
Net income (reported) 553 560 380 400 Net change in cash 286 (616) (66) (10)
% change Y/Y 10.4% 1.3% (32.1%) 5.2% Beginning cash 1,409 1,695 1,079 1,012
Net Profit Recurring 550 560 380 400 Ending cash 1,695 1,079 1,012 1,003
Shares outstanding 2,090 2,090 2,090 2,090 DPS 0.13 0.13 0.07 0.08
EPS (recurring) 0.26 0.27 0.18 0.19
EPS (reported) 0.26 0.27 0.18 0.19
Balance sheet Ratio Analysis
S$ in millions, year end Dec FY13 FY14 FY15E FY16E S$ in millions, year end Dec FY13 FY14 FY15E FY16E
Cash and cash equivalents 1,695 1,079 1,012 1,003 Gross margin 12.8% 14.5% 13.0% 12.6%
Accounts receivable 442 469 395 409 Reported PATMI margin 9.9% 9.6% 7.7% 7.8%
Inventories 2,084 3,005 2,988 3,094
Others 0 14 12 13 Sales growth 24.7% 5.6% (15.0%) 3.6%
Current assets 4,221 4,567 4,408 4,519 EPS growth 18.8% 1.8% (32.1%) 5.2%
LT investments 107 90 90 90
Net fixed assets 2,394 3,009 3,245 3,462 Receivables - no. of days 30.1 28.5 31.8 28.6
Total Assets 7,250 8,238 8,294 8,632 Inventories - no. of days 147.5 190.4 263.9 257.8
Short-term loans 166 434 434 434 Payables - no. of days 134.1 134.9 162.6 160.9
Payables 1,781 1,826 1,866 1,929
Total current liabilities 3,530 3,449 3,266 3,360 Interest coverage (x) NM 72.7 31.9 25.6
Long-term debt 600 1,308 1,308 1,308 Net debt to equity (33.1%) 21.2% 21.6% 20.4%
Other liabilities 310 350 350 350
Total Liabilities 4,441 5,106 4,924 5,018 Sales/assets 84.8% 75.3% 60.0% 60.7%
Shareholders' equity 2,677 2,965 3,186 3,411 Assets/equity 254.8% 274.5% 268.8% 256.6%
Total Liabilities and equity 7,250 8,238 8,294 8,632 ROE 21.5% 19.8% 12.4% 12.1%
BVPS 1.28 1.42 1.52 1.63 ROCE 18.3% 14.8% 8.9% 8.5%
Net Debt (929) 663 729 739
Source: Company reports and J.P. Morgan estimates.

Valuation Per share


P/E (x) (S$ M) (S$)
DCF valuation of existing orderbook only 882 0.42
Ship repair 86 6x 519 0.25
Cosco Shipyard Group 0.45 262 0.13
Business value of offshore-conversion 2,581 1.24
Net cash (excluding customer receivables) 0 0.00
Offshore valuation (excluding Cosco, including cash) 3,982 2.91
Listed entities Shareholding
Cosco Corp 5.0% 50 0.02
Fair value of SembCorp Marine 4,294 2.05
Price target (S$) 2.00
Shares outstanding (M) 2,090

461
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

StarHub
Underweight
www.starhub.com.sg
STAR.SI,STH SP
Investment Thesis
Price: S$3.56
The Singapore telecom regulator (IDA) is expected to come up with a regulatory
Price Target: S$3.30
framework for the entry of new players this month. In our view, the regulator has a
strong basis for introducing new competition. We believe that unlike in the past, the
Singapore regulatory framework could potentially create a more viable business case for a new
Wireless Services entrant and we are increasingly of the view that pricing power in the Singapore
AC
Princy Singh wireless market is likely to diminish - signaled by recent promotions introduced by
(65) 6882-2746 incumbents. Impact could be varied, depending on the regulatory framework - M1
princy.singh@jpmorgan.com and Starhub are most exposed (we are UW on both), maintain Neutral on Singtel.
Bloomberg JPMA SINGH <GO>
J.P. Morgan Securities Singapore Private
Limited Valuation
Our June-16 price target of SGD 3.30 is based on 15x 2016E P/E and at 20%
Price Performance
discount to historical trading averages in the last 3 years. We see valuation overhang
4.6
from the potential entry of a fourth mobile operator. We expect consensus estimates
4.2 for M1 to trend downwards, which will drive multiple re-rating for the stock.
S$
3.8
Risks to Rating and Price Target
3.4
Nov-14 Feb-15 May-15 Aug-15 Nov-15 Key upside risks include higher-than-expected subsidy cuts on handsets and market
STAR.SI share price (S$) share gains in enterprise segment.
FTSTI (rebased)
YTD 1m 3m 12m
Abs -14.2% 0.6% -5.1% -12.7%
Rel -1.0% 2.6% 0.3% -1.2%

StarHub (Reuters: STAR.SI, Bloomberg: STH SP)


Company Data S$ in mn, year-end Dec FY13A FY14A FY15E FY16E FY17E
52-week Range (S$) 4.46-3.40 Revenue (S$ mn) 2,361 2,387 2,491 2,564 2,655
Market Cap (S$ mn) 6,119 EBITDA (S$ mn) 735 748 741 757 793
Market Cap ($ mn) 4,298 EBITDA Growth 2.1% 1.8% (0.9%) 2.1% 4.7%
Shares O/S (mn) 1,719 Recurring profit (S$ mn) 373 371 370 373 384
Free Float(%) 33.4% Recurring EPS (S$) 0.22 0.22 0.21 0.22 0.22
3M - Avg daily vol (mn) 1.71 EPS growth (%) 5.6% (2.7%) (0.1%) 0.7% 3.0%
3M - Avg daily val ($ mn) 4.3 DPS (S$) 0.20 0.20 0.22 0.22 0.22
FTSTI 2925.68 EV/EBITDA (x) 9.2 9.0 9.1 9.0 8.6
Exchange Rate 1.42 P/E (x) 16.1 16.6 16.6 16.5 16.0
Price (S$) 3.56 Dividend Yield 5.6% 5.6% 6.2% 6.2% 6.2%
Date Of Price 13 Nov 15 FCF to mkt cap (%) 5.1% 5.7% 6.5% 6.0% 6.5%
Price Target End Date 30-Jun-16 Source: Company data, Bloomberg, J.P. Morgan estimates.
Price Target (S$) 3.30

466
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

StarHub: Summary of Financials


Income Statement Balance sheet
S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E
Revenue 2,361 2,387 2,491 2,564 2,655 Cash and cash equivalents 267 264 262 219 204
EBITDA 735 748 741 757 793 Accounts receivable 124 162 169 174 180
Depreciation & Amortization (270) (271) (277) (290) (312) Others 222 246 254 259 267
EBIT 465 477 465 467 481 Total current assets 612 672 685 652 650
Interest income 3 2 2 2 2
Interest expense (19) (23) (19) (20) (20) ST loans 0 200 200 200 200
Other Income (15) (20) (10) (30) (35) Accounts Payables 456 459 487 497 512
Profit before tax 449 456 462 449 462 Others current liabilities 446 534 555 563 574
Tax (77) (86) (80) (76) (79) Total current liabilities 902 1,193 1,242 1,259 1,285
Minorities - - - - -
Net profit - reported 373 371 382 373 384 Net working capital (332) (297) (318) (323) (332)
Net profit - adjusted 373 371 370 373 384
Net fixed assets 857 911 1,009 1,102 1,185
Shares Outstanding (mn) 1,686 1,724 1,723 1,723 1,723 Net Intangibles 381 405 355 305 255
EPS (S$) (reported) 0.22 0.22 0.22 0.22 0.22 Others non current assets 0 0 0 0 0
DPS (S$) 0.20 0.20 0.22 0.22 0.22 Total non-current assets 1,238 1,316 1,363 1,406 1,439
DPS payout ratio 90.5% 93.0% 99.2% 101.7% 98.8%
Total Assets 1,850 1,987 2,048 2,059 2,089
Revenue growth (2.5%) 1.1% 4.3% 2.9% 3.5%
EBITDA growth 2.1% 1.8% (0.9%) 2.1% 4.7% Long-term debt 688 488 488 488 488
Net profit growth 3.7% (0.5%) 3.1% (2.5%) 3.0% Other liabilities 178 158 158 158 158
EPS growth 5.6% (2.7%) 3.2% (2.5%) 3.0% Total Liabilities 1,767 1,838 1,887 1,905 1,931
DPS growth 0.0% 0.0% 10.0% 0.0% 0.0%
Shareholders' equity 83 149 161 154 159
Total liabilities and equity 1,850 1,987 2,048 2,059 2,089
Net debt/(cash) 421 423 425 468 484
Ratio Analysis Cash flow statement
%, year end Dec FY13 FY14 FY15E FY16E FY17E S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E
EBITDA margin 31.1% 31.3% 29.8% 29.5% 29.9% Cash flow from operations 595 655 710 688 727
FCF margin 12.9% 14.7% 16.1% 14.4% 15.0% Capex (303) (322) (324) (333) (345)
ROE 590.5% 320.0% 239.0% 236.8% 245.3% Cash flow from other investing 3 3 2 2 2
ROC 51.4% 48.2% 45.6% 45.9% 47.3% Cash flow from financing (341) (339) (390) (399) (399)
ROA 20.4% 19.3% 18.3% 18.1% 18.5%
Change in cash for year (46) (3) (1) (43) (15)
Tax rate 17.1% 18.8% 17.3% 17.0% 17.0%
Capex to sales 12.8% 13.5% 13.0% 13.0% 13.0% Beginning cash 312 266 263 262 219
Debt/Capital 83.6% 74.0% 72.6% 75.2% 75.3% Ending cash 266 263 262 219 204
Net debt or (cash) to equity 508.6% 284.1% 264.8% 303.9% 304.9%
Interest coverage (x) 46.2 36.5 42.9 42.1 43.3
Source: Company reports and J.P. Morgan estimates.

467
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

United Overseas Bank (UOB)


Underweight
www.uobgroup.com
UOBH.SI,UOB SP
Investment Thesis
Price: S$20.15
We maintain our structural UW on UOB. Key points:
Price Target: S$18.50 Higher rates would have a very different impact on UOBs earnings vs. the 2005-
06 rate cycle. In the current cycle, a 100bps move in rates would lead to NII
Singapore increase of S$300-400mn (as per the bank), and S$180mn pick-up in credit costs
Banks as debt servicing burden for borrowers moves up (as per JPMe). Hence, the net
AC
Harsh Wardhan Modi gain from even a 100bp rate hike would be rather limited. This is very different
(65) 6882- 2450 from the situation in 2005-06, when the bank's earnings increased by 50% y/y in
harsh.w.modi@jpmorgan.com FY06 for a 194bp move-up in SIBOR.
Bloomberg JPMA MODI <GO>
J.P. Morgan Securities Singapore Private We worry about the banks real estate exposure, especially the investment
Limited property loans (about 30% of Singapore mortgages) and small- and medium-sized
Price Performance
developers (about 30-40%) of total developer book in Singapore. The bank has
26 delivered 14% growth in mortgages in the last five years and 17% growth in
24 building and construction loans, which poses risks of NPL formation. Following
S$ 22 the large NPL formation in 2Q last year, we have become wary of credit
20 underwriting standards for real estate loans at the bank.
18
Nov-14 Feb-15 May-15 Aug-15 Nov-15
After 1H15 NIM pick-up, we do not see any more avenues of margin expansion
UOBH.SI share price (S$) at the bank as 90% SG$ LDR (83% group LDR) and mid-50s SG$ CASA (42%
FTSTI (rebased) group CASA) limit the banks ability to manage funding costs at a point when
YTD 1m 3m 12m
Abs -17.8% 1.3% -1.0% -13.1% system liquidity is running very tight. Our 2015/16 estimates are 2%/16% below
Rel -4.6% 3.3% 4.4% -1.6% the Street and we see limited drivers for the stock in the near term.

Valuation
Our Dec-16 PT of S$18.5 is based upon a 2-stage DDM. We use a fair P/BV
multiple of 0.95x with a normalized RoE of 9.6%, risk-free rate of 3.75%, cost of
capital of 10.0%, and growth rate of 2.0%.
Risks to Rating and Price Target
Key upside risks to our view include meaningful easing in deposit competition,
better-than-expected margins, and better asset quality.

United Overseas Bank Ltd (Reuters: UOBH.SI, Bloomberg: UOB SP)


Company Data S$ in mn, year-end Dec FY12A FY13A FY14A FY15E FY16E FY17E
52-week Range (S$) 25.00-18.20 Operating Profit (S$ mn) 3,748 3,824 4,211 4,436 4,539 5,012
Market Cap (S$ mn) 32,294 Net Profit (S$ mn) 2,700 2,905 3,136 3,095 2,731 3,067
Market Cap ($ mn) 22,683 Cash EPS (S$) 1.70 1.84 1.97 1.92 1.68 1.89
Shares O/S (mn) 1,603 DPS (S$) 0.70 0.75 0.75 0.85 0.85 0.85
Fiscal Year End Dec EPS growth (%) 20.3% 8.0% 7.4% (2.7%) (12.3%) 12.3%
Price (S$) 20.15 ROE 12.3% 12.3% 12.2% 11.0% 9.2% 9.8%
Date Of Price 13 Nov 15 P/E (x) 11.8 11.0 10.2 10.5 12.0 10.7
3M - Avg daily val (S$ mn) 71.02 BVPS (S$) 14.44 15.36 17.09 17.94 18.77 19.81
3M - Avg daily val ($ mn) 49.9 P/BV (x) 1.40 1.31 1.18 1.12 1.07 1.02
3M - Avg daily vol (mn) 3.62 Dividend Yield 3.5% 3.7% 3.7% 4.2% 4.2% 4.2%
FTSTI 2925.68 Fully Diluted EPS (S$) 1.70 1.84 1.97 1.92 1.68 1.89
Exchange Rate 1.42 Source: Company data, Bloomberg, J.P. Morgan estimates.
Price Target End Date 31-Dec-16
Price Target (S$) 18.50

474
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

United Overseas Bank (UOB): Summary of Financials


Income Statement Growth Rates
S$ in millions, year end Dec FY13 FY14 FY15E FY16E FY17E FY13 FY14 FY15E FY16E FY17E
NIM (as % of avg. assets) 1.6% 1.6% 1.6% 1.6% 1.7% Loans 16.8% 9.5% 1.8% 1.6% 4.5%
Earning assets/assets 89.3% 90.3% 88.7% 88.7% 88.8% Deposits 17.9% 9.0% 5.2% 2.5% 5.2%
Margins (as % of Avg. Assets) 1.4% 1.5% 1.4% 1.4% 1.5% Assets 12.4% 7.9% 5.6% 3.4% 5.6%
Equity 5.6% 13.1% 6.3% 4.6% 5.5%
Net Interest Income 4,120 4,558 4,892 5,090 5,551 RWA 23.9% 8.4% 8.7% 5.1% 7.3%
Total Non-Interest Income 2,601 2,799 3,065 3,236 3,484 Net Interest Income 5.2% 10.6% 7.3% 4.0% 9.1%
Fee Income 1,731 1,749 1,889 2,040 2,203 Non-Interest Income 0.9% 7.6% 9.5% 5.6% 7.7%
Dealing Income 544 717 846 846 914 of which Fee Grth 14.8% 1.0% 8.0% 8.0% 8.0%
Revenues 3.5% 9.5% 8.2% 4.6% 8.5%
Total operating revenues 6,721 7,357 7,957 8,325 9,035 Costs 5.5% 8.6% 11.9% 7.5% 6.2%
Pre-Provision Profits 2.0% 10.1% 5.3% 2.3% 10.4%
Operating costs (2,897) (3,146) (3,522) (3,787) (4,022) Loan Loss Provisions (10.5%) 40.2% 17.1% 72.4% 4.5%
Pre-Prov. Profits 3,824 4,211 4,436 4,539 5,012 Pre-Tax 7.0% 6.7% 0.3% (10.8%) 12.5%
Provisions (408) (572) (670) (1,155) (1,207) Attributable Income 7.6% 7.9% (1.3%) (11.8%) 12.3%
Other Inc - - - - - EPS 8.0% 7.4% (2.7%) (12.3%) 12.3%
Other Exp. (22) 37 (60) (100) (100) DPS 7.1% 0.0% 13.3% 0.0% 0.0%
Exceptionals - - - - -
Associate 190 149 130 137 143 Balance Sheet Gearing FY13 FY14 FY15E FY16E FY17E
Pre-tax 3,584 3,825 3,836 3,420 3,849 Loan/deposit 83.4% 83.8% 81.1% 80.2% 79.5%
Tax (559) (561) (614) (564) (654) Investment/assets 12.4% 10.6% 10.0% 9.8% 9.5%
Minorities (17) (15) (20) (18) (20) Loan/Assets 62.9% 64.5% 63.8% 62.1% 61.2%
Attributable Income 2,905 3,136 3,095 2,731 3,067 Customer deposits/liab. 82.6% 83.7% 83.4% 82.7% 82.4%
LT debt/liabilities 13.7% 12.0% 11.4% 11.7% 12.2%
Per Share Data SGD FY13 FY14 FY15E FY16E FY17E Asset Quality/Capital FY13 FY14 FY15E FY16E FY17E
EPS 1.84 1.97 1.92 1.68 1.89 Loan loss reserves/loans (1.7%) (1.7%) (1.8%) (2.1%) (2.2%)
DPS 0.75 0.75 0.85 0.85 0.85 NPLs/loans 1.3% 1.2% 1.3% 1.7% 2.2%
Payout 40.8% 38.0% 44.3% 50.5% 45.0% Loan loss reserves/NPLs 136.3% 148.0% 134.1% 114.3% 98.2%
Book value 15.36 17.09 17.94 18.77 19.81 Growth in NPLs (12.2%) 13.7% 25.9% 34.2% 31.1%
Fully Diluted Shares 1,582 1,590 1,613 1,623 1,623 Tier 1 Ratio 13.2% 13.9% 14.0% 14.0% 13.9%
PPOP per share 2.43 2.65 2.75 2.80 3.09 Total CAR 16.6% 16.9% 16.7% 16.6% 16.3%
Key Balance sheet S$ in millions FY13 FY14 FY15E FY16E FY17E Du-Pont Analysis FY13 FY14 FY15E FY16E FY17E
Net Loans 178,857 195,903 199,294 201,965 210,731 NIM (as % of avg. assets) 1.6% 1.6% 1.6% 1.6% 1.7%
LLR (3,121) (3,440) (3,704) (4,240) (4,800) Earning assets/assets 89.3% 90.3% 88.7% 88.7% 88.8%
Gross Loans 181,978 199,343 202,998 206,205 215,531 Margins (as % of Avg. Assets) 1.4% 1.5% 1.4% 1.4% 1.5%
NPLs 2,074 2,358 2,968 3,983 5,220 Non-Int. Rev./ Revenues 38.7% 38.0% 38.5% 38.9% 38.6%
Investments 31,363 31,265 31,890 32,528 33,179 Non IR/Avg. Assets 1.0% 0.9% 1.0% 1.0% 1.0%
Other earning assets 9,280 9,256 10,182 10,691 11,225 Revenue/Assets 2.5% 2.5% 2.5% 2.5% 2.6%
Avg. IEA 239,858 266,801 279,810 292,340 305,960 Cost/Income 43.1% 42.8% 44.3% 45.5% 44.5%
Goodwill 0 0 0 0 0 Cost/Assets 1.1% 1.1% 1.1% 1.1% 1.2%
Assets 284,230 306,736 324,018 335,063 353,837 Pre-Provision ROA 1.4% 1.4% 1.4% 1.4% 1.5%
LLP/Loans (0.2%) (0.3%) (0.3%) (0.6%) (0.6%)
Deposits 214,547 233,750 245,816 251,849 264,962 Loan/Assets 62.9% 64.5% 63.8% 62.1% 61.2%
Long-term bond funding 32,687 32,179 33,473 36,471 39,748 Other Prov, Income/ Assets 0.1% 0.1% 0.0% 0.0% 0.0%
Other Borrowings 7,474 8,560 8,731 9,255 9,810 Operating ROA 1.3% 1.2% 1.2% 1.0% 1.1%
Avg. IBL 232,841 257,986 272,609 283,804 296,515 Pre-Tax ROA 1.3% 1.3% 1.2% 1.0% 1.1%
Avg. Assets 268,565 295,483 315,377 329,541 344,450 Tax rate 15.6% 14.7% 16.0% 16.5% 17.0%
Common Equity 24,208 27,389 29,105 30,456 32,144 Minorities & Outside Distbn. 0.1% 0.1% 0.1% 0.1% 0.1%
RWA 164,911 178,792 194,411 204,389 219,379 ROA 1.1% 1.1% 1.0% 0.8% 0.9%
Avg. RWA 149,007 171,852 186,601 199,400 211,884 RORWA 1.9% 1.8% 1.7% 1.4% 1.4%
Equity/Assets 8.8% 8.7% 9.0% 9.0% 9.1%
ROE 12.3% 12.2% 11.0% 9.2% 9.8%
Source: Company reports and J.P. Morgan estimates.

475
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Yangzijiang Shipbuilding Holdings Ltd.


Underweight
www.yzjship.com
YAZG.SI,YZJSGD SP
Investment Thesis
Price: S$1.11
Yangzijiang Shipbuilding is one of the leading private yards in China specializing in
Price Target: S$1.00
bulk carriers. Listed on the SGX in 2007, the company has shown stronger
operational performance than its peers. Since 2010, the company has compensated
Singapore for weaker industrial trends with HTM asset investments, generating 16-28% of its
Ship Building & Repairs gross profit from the new business. Now, with the recovery of the shipbuilding
AC
Sokje Lee industry, YZJ is focusing more on its core business. However, we see continued
(82-2) 758-5729 downside risks from its shipbuilding operations, given its lack of basic design skills
sokje.lee@jpmorgan.com compared to Korean and Japanese peers. Moreover, we expect the tightening
Bloomberg JPMA SOKJELEE <GO>
environmental regulations to be a threat to its order outlook, which will likely
J.P. Morgan Securities (Far East) Limited,
Seoul Branch pressure its share price momentum.
James R. Sullivan, CFA
(65) 6882-2374 Valuation
james.r.sullivan@jpmorgan.com We maintain our Underweight rating on YZJ and roll over our PT timeframe to Dec-
Bloomberg JPMA SULLIVAN <GO> 16 with a S$1 PT. Our PT is derived by applying target P/B multiple of 0.7x to
J.P. Morgan Securities Singapore Private
Limited
2016E BPS of Rmb6.18 (or S$0.97, based on 3Q16 JPMe FX assumptions). Our
target P/B multiple of 0.7x is SD-1 of YZJs five-year historical average, as we factor
Price Performance in the expected earnings downside from low-priced orders and falling bulk freight
1.5
rates..
1.3
S$
Risks to Rating and Price Target
1.1
Key upside risks include: (1) proven fuel efficiency outweighing competitors; (2)
0.9
Nov-14 Feb-15 May-15 Aug-15 Nov-15
successful integration and development of in-house basic design; and (3)
YAZG.SI share price (S$) newbuilding price increases.
FTSTI (rebased)
YTD 1m 3m 12m
Abs -8.3% -12.6% -7.1% -6.3%
Rel 5.2% -9.0% -2.2% 5.7%

Yangzijiang Shipbuilding Holdings Ltd. (Reuters: YAZG.SI, Bloomberg: YZJSGD SP)


Company Data Year-end Dec FY14A FY15E FY16E FY17E
Shares O/S (mn) 3,832 Revenue (Rmb mn) 15,354 18,507 15,117 13,867
Market Cap (Rmb bn) 19 Operating Profit (Rmb mn) 3,709 2,945 2,201 1,752
Market Cap ($ mn) 2,987 Net Profit (Rmb mn) 3,479 3,017 1,945 1,609
Price (S$) 1.11 EPS (Rmb) 0.91 0.79 0.51 0.42
Date Of Price 18 Nov 15 BVPS (Rmb) 5.34 5.85 6.18 6.45
Free Float(%) 55.4% Revenue growth 7.1% 20.5% (18.3%) (8.3%)
3M - Avg daily vol (mn) 13.04 EPS growth 12.4% (13.3%) (35.5%) (17.3%)
3M - Avg daily val (S$ bn) 0.02 ROE 18.2% 14.1% 8.4% 6.7%
3M - Avg daily val ($ mn) 10.7 P/E (x) 5.5 6.3 9.8 11.8
FTSTI 2916.78 P/BV (x) 0.9 0.9 0.8 0.8
Exchange Rate 1.42 EV/EBITDA (x) 6.0 6.2 7.5 8.9
Price Target End Date 31-Dec-16 Dividend Yield 6.1% 5.7% 3.6% 3.0%
Price Target (S$) 1.00 ROA 8.3% 7.3% 4.7% 3.9%
Source: Company data, Bloomberg, J.P. Morgan estimates. Note=Annual net profit, EPS and ROE based on 'net profit attributable to
equity holders'.

486
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Yangzijiang Shipbuilding Holdings Ltd.: Summary of Financials


Balance sheet Income Statement
Rmb in billions, year end Dec FY14 FY15E FY16E FY17E Rmb in billions, year end Dec FY14 FY15E FY16E FY17E
Assets 40,778 41,620 42,536 43,450 Net Sales 15,354 14,287 13,881 13,309
Current assets 25,762 25,297 25,080 24,734 Growth(%) 7.1% (6.9%) (2.8%) (4.1%)
Cash and cash equivalents 2,653 5,706 5,409 4,649 Cost of Sales (11,210) (11,715) (11,322) (10,961)
Trade and Other Current Receivables 841 783 761 729 Gross Profit on Sales 4,144 2,572 2,558 2,348
Inventories 2,015 1,284 1,241 1,201 Gross margin 27.0% 18.0% 18.4% 17.6%
Others 20,254 17,524 17,670 18,154 SG&A (435) (400) (350) (350)
Non-current Assets 15,016 16,323 17,456 18,717
Property, Plant and Equipment 6,117 6,252 6,444 6,586 Operating Income 3,709 2,172 2,208 1,998
Investments in Associates 463 463 463 463 Growth(%) (15.9%) (41.4%) 1.7% (9.5%)
Others 8,433 9,606 10,549 11,667 Operating Margin (%) 24.2% 15.2% 15.9% 15.0%
Liabilities 19,702 19,610 19,449 19,395
Current liabilities 15,364 15,114 14,755 14,492 Income Before Income Taxes 3,953 2,205 2,247 2,042
Trade and Other Current Payables 5,723 5,437 5,165 4,907 Income Taxes Expenses (472) (419) (427) (388)
Others 9,641 9,677 9,590 9,586 Tax Rate (%) 11.9% 19.0% 19.0% 19.0%
Non-current Liabilities 4,338 4,496 4,695 4,903 Net Income 3,479 1,776 1,810 1,644
Long-term debt 2,636 2,768 2,906 3,052 Growth(%) 12.4% (48.9%) 1.9% (9.2%)
Others 1,702 1,728 1,788 1,851
Stockholders' Equity 21,076 22,010 23,087 24,055 EBITDA 4,140 2,692 2,773 2,612
Total Debt 8,050 7,911 7,793 7,694 Growth(%) (11.9%) (35.0%) 3.0% (5.8%)
Net Debt(Cash) 5,398 2,206 2,384 3,044
Cash flow statement Ratio Analysis
Rmb in billions, year end Dec FY14 FY15E FY16E FY17E Rmb, year end Dec FY14 FY15E FY16E FY17E
Cash Flows from Operating 9,061 4,343 1,155 709 EPS 0.91 0.46 0.47 0.43
Net Income(Net Loss) 3,479 1,776 1,810 1,644 EPS Growth(%) 12.4% (48.9%) 1.9% (9.2%)
Depreciation & Amortisation 430 520 565 614 BPS 5.34 5.64 5.95 6.23
(Inc) Dec in working capital 5,257 2,049 (1,217) (1,430) DPS 0.31 0.17 0.17 0.15
Payments of Income Taxes (492) (419) (427) (388) Dividend Yield(%) 5.9% 3.2% 3.2% 2.9%
Others - - - - PER (x) 5.7 11.2 10.9 12.1
Cash Flows from Investing (1,351) (1,640) (1,808) (1,882) PBR (x) 1.0 0.9 0.9 0.8
Free cash flow 8,486 4,012 721 273 EV/ EBITDA (x) 7.0 9.6 9.4 10.3
Cash Flows from Financing (6,494) 350 355 414 ROE(%) 18.2% 8.4% 8.2% 7.0%
Inc(Dec) in Cash 1,216 3,053 (297) (759) Gross Margin (%) 27.0% 18.0% 18.4% 17.6%
Cash at The Beginning 1,436 2,653 5,706 5,409 Operating Margin (%) 24.2% 15.2% 15.9% 15.0%
Cash at The End 2,653 5,706 5,409 4,649 Net margin(%) 22.7% 12.4% 13.0% 12.4%
EBITDA Margin (%) 27.0% 18.8% 20.0% 19.6%
Total debt-to-equity ratio 38.2% 35.9% 33.8% 32.0%
Net debt-to-equity ratio 0.3 0.1 0.1 0.1
Source: Company reports and J.P. Morgan estimates. Net profit, EPS and ROE based on Owners' net income; BVPS based on Owners of parent equity.

487
Adrian Mowat Asia Pacific Equity Research
(852) 2800-8599 23 November 2015
adrian.mowat@jpmorgan.com

Year of the Monkey


The Year of the Monkey will be one of rises and falls. When you are on the rise,
you shouldnt be vain, and if you are low, do not despair. Even if everything is going
wrong, you will always have many ways to resolve it. The sun will appear on the
horizon and the clouds will vanish, the main thing is not to lose faith in your own
strength.

Be prepared for the bull and bear case to happen: There is a large range of
potential outcomes for EM equities in 2016. Be conscious about what could go right
in markets where positioning is bearish or the event fundamental risks to an asset
class where investors confidence is fragile.

We will be confronted with insurmountable objects. We will have enough strength


to overcome these difficulties. The understanding of the situation gives us the key to
Animal Returns (%)
victory over these circumstances.
Goat
Rabbit Understanding EPS growth: Equity performance is a combination of EPS growth,
Monkey changes in risk premiums and currency moves versus the dollar. EPS growth is the
Rooster most important fundamental. International investors in EM are growth tourists.
Boar MSCI APxJ 2015/16 consensus EPS were revised down by 11%/13% YTD. Skew
Dragon
asset allocation to where you are relatively more confident on earnings, avoid
Tiger
Horse
energy and materials.
Snake
Ox It will be a time of understanding, awareness and acceptance of certain hidden
Dog knowledge. Whether it is good or not is up to every individual to decide. It is
Rat important to realize that 2016 will give everyone almost unlimited opportunities in
-25% 0% 25% 50% terms of spiritual progress.

Source: Datastream, J.P. Morgan


New norm in China: The policy objective is stability not stimulus. It is a difficult
calculations. Average performance for balancing act as old industry consolidation hits labour income impacting demands
Datastream Total Market Asia ex-Japan versus services employment growth. Low consumer leverage provides a cushion.
Index, 1973-2015 The stock market has a growth, new economy bias. We remain economic bear equity
bull.

The detailed returns for the Year The Fire Monkey is fundamentally different from 2015's Wooden Goat. 2016 will
of Monkey: +73% (1980), flat
give us time to feel at ease. There will be no need to rush, but pointless delays won't
(1992) and +11% (2004).
be advantageous to you either. It is important to learn how to act with reasonable
speed; to synchronize yourself with the outside world. Such an approach will always
J.P. Morgans equity strategy ensure that you are in the right place; circumstances will provide you with a good
team takes no responsibility for time for new beginnings.
investment decisions based on
this page. The Wooden Goat finally lands on its feet after sliding down the ramp. (MSCI
APxJ rebounded 6% after falling 26% from May to its low in September). The Fire
Monkey is known to be mischievous, intelligent and above all a cunning enemy,
Our source for the material in
capable of turning any situation. Bearish positioning in Asia Pacific equities skews
the quotes is:
risk to the upside. The bull case is a declining risk premium in China (economic
www.gotohoroscope.com/2016- stability, RMB and debt sustainability) and secular EPS growth. The end of ZIRP is
horoscope/ in sight. The pace of tightening post lift-off is still under debate. We are OW on
China, Korea, Taiwan and Indonesia.

536
Aditya Srinath, CFA Asia Pacific Equity Research
(62-21) 5291-8573 23 November 2015
aditya.s.srinath@jpmorgan.com

Analyst Certification: The research analyst(s) denoted by an AC on the cover of this report certifies (or, where multiple research
analysts are primarily responsible for this report, the research analyst denoted by an AC on the cover or within the document
individually certifies, with respect to each security or issuer that the research analyst covers in this research) that: (1) all of the views
expressed in this report accurately reflect his or her personal views about any and all of the subject securities or issuers; and (2) no part of
any of the research analyst's compensation was, is, or will be directly or indirectly related to the specific recommendations or views
expressed by the research analyst(s) in this report. For all Korea-based research analysts listed on the front cover, they also certify, as per
KOFIA requirements, that their analysis was made in good faith and that the views reflect their own opinion, without undue influence or
intervention.
Important Disclosures

This report is an extract from our Asian Year Ahead 2016 report, published 23 November 2015. Important disclosures, including
disclosures on all stocks recommended in the Asian Year Ahead 2015 publication, can be accessed using this link.
Company-Specific Disclosures: Important disclosures, including price charts and credit opinion history tables, are available for
compendium reports and all J.P. Morgancovered companies by visiting https://jpmm.com/research/disclosures, calling 1-800-477-0406,
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Explanation of Equity Research Ratings, Designations and Analyst(s) Coverage Universe:
J.P. Morgan uses the following rating system: Overweight [Over the next six to twelve months, we expect this stock will outperform the
average total return of the stocks in the analysts (or the analysts teams) coverage universe.] Neutral [Over the next six to twelve
months, we expect this stock will perform in line with the average total return of the stocks in the analysts (or the analysts teams)
coverage universe.] Underweight [Over the next six to twelve months, we expect this stock will underperform the average total return of
the stocks in the analysts (or the analysts teams) coverage universe.] Not Rated (NR): J.P. Morgan has removed the rating and, if
applicable, the price target, for this stock because of either a lack of a sufficient fundamental basis or for legal, regulatory or policy
reasons. The previous rating and, if applicable, the price target, no longer should be relied upon. An NR designation is not a
recommendation or a rating. In our Asia (ex-Australia) and U.K. small- and mid-cap equity research, each stocks expected total return is
compared to the expected total return of a benchmark country market index, not to those analysts coverage universe. If it does not appear
in the Important Disclosures section of this report, the certifying analysts coverage universe can be found on J.P. Morgans research
website, www.jpmorganmarkets.com.

J.P. Morgan Equity Research Ratings Distribution, as of June 30, 2015


Overweight Neutral Underweight
(buy) (hold) (sell)
J.P. Morgan Global Equity Research Coverage 44% 43% 13%
IB clients* 51% 48% 38%
JPMS Equity Research Coverage 45% 47% 9%
IB clients* 71% 66% 57%
*Percentage of investment banking clients in each rating category.
For purposes only of FINRA/NYSE ratings distribution rules, our Overweight rating falls into a buy rating category; our Neutral rating falls into a hold
rating category; and our Underweight rating falls into a sell rating category. Please note that stocks with an NR designation are not included in the table
above.

Equity Valuation and Risks: For valuation methodology and risks associated with covered companies or price targets for covered
companies, please see the most recent company-specific research report at http://www.jpmorganmarkets.com, contact the primary analyst
or your J.P. Morgan representative, or email research.disclosure.inquiries@jpmorgan.com.
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Other Disclosures
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20

This document is being provided for the exclusive use of vijaykerba.walke@jpmorgan.com & clients of J.P. Morgan.
Aditya Srinath, CFA Asia Pacific Equity Research
(62-21) 5291-8573 23 November 2015
aditya.s.srinath@jpmorgan.com

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21

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Aditya Srinath, CFA Asia Pacific Equity Research
(62-21) 5291-8573 23 November 2015
aditya.s.srinath@jpmorgan.com

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"Other Disclosures" last revised July 14, 2015.


Copyright 2015 JPMorgan Chase & Co. All rights reserved. This report or any portion hereof may not be reprinted, sold or
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22

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Management
Director of Director of Director of Director of Director of
International Asia ex-Japan ASEAN Australia Japan
Equity Research Equity Research Equity Research Equity Research Equity Research

Sunil Garg James Sullivan Aditya Srinath Jason Steed Hisashi Moriyama

Macro Team
Chief Asian and ASEAN Head of EM China Equity Derivatives Asia Pacific Head of
Emerging Market Equity Markets Asia, Economic and Delta One Quantitative Economic
Equity Strategist Strategy Economics Research Research Strategy Strategy Research Japan

Adrian Mowat Aditya Srinath Jahangir Aziz Haibin Zhu Tony Lee Robert Smith Masaaki Kanno

Country Heads and Markets Strategy


Australia China Hong Kong India Indonesia

Jason Steed Karen Li Cusson Leung Bharat Iyer Aditya Srinath

Malaysia Philippines Singapore South Korea Thailand

Hoy Kit Mak Jeanette Yutan Aditya Srinath JJ Park Anne Jirajariyavech

Energy Ecosystem Financial Strategy


Oil & Gas, Power Utilities, Thermal ASEAN Greater China Asia-ex
Chemicals & Refining Alternative Energy Coal Banks Banks Insurance

Scott Darling Boris Kan Daniel Kang Harsh Modi Katherine Lei MW Kim

Infrastructure and Internet/Media/Telco Transportation and


Capex Ecosystem Ecosystem Technology Logistics Ecosystem
Infra & Industrials Telecommunications APAC Technology India IT Services Transport

Karen Li James Sullivan JJ Park Viju George Corrine Png

Domestic Demand
Basic Materials Auto and Auto Parts Consumer Gaming Real Estate SMID Caps

Daniel Kang Nick Lai Ebru Sener Kurumlu DS Kim Cusson Leung Leon Chik