ASE General Index Price

Index Data

Reuters RIC .ATG Bloomberg Code ASE Index Closing Price (29/08) 893.77 52 Week High 1,159.97 52 Week Low 642.22 Performance (1m) +3.1% Performance (YTD) -1.6%

Research Team

John Kalantzis, Head of Research

+ 30 210 3720118 jkalantzis@eurobankequities.gr

Stamatios Draziotis, CFA

+ 30 210 3720259 sdraziotis@eurobankequities.gr

Nikos Koskoletos, CFA

+ 30 210 3720257 nkoskoletos@eurobankequities.gr

Katerina Zaharopoulou

+ 30 210 3720252 kzaharopoulou@eurobankequities.gr

Christina Kouklaki

+ 30 210 3720254 ckouklaki@eurobankequities.gr

Sales

+30 2103720119

Trading

+30 2103720168 / 110

See Appendix for Analyst Certification and important disclosures

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GREECE | EQUITY RESEARCH September 03, 2013

STRATEGY UPDATE

Greek Equity Strategy Update

FFeeaattuurriinngg

EXECUTIVE SUMMARY | Rolling a hard six?

NON-FINANCIALS | Fairly valued

BANKS | Pending loose ends

MACRO | Restoring sustainability

COMPANY SECTION

GREEK EQUITY STRATEGY

September 03, 2013

2

Summary of recommendations and price targets

Eurobank Equities Non-financials coverage

Stock Mcap

(EURmn) Current

Price (EUR) Recommendation Target Price (EUR)

Upside / Downside (%)

Page #

Top picks

OTE 3,353 6.84 Buy 8.30 21% 43

Metka 526 10.13 Buy 13.40 32% 49

EYDAP 628 5.90 Buy 7.60 26% 48

Banks

Alpha Bank 5,472 0.50 Hold 0.514 3% 40

Piraeus Bank 5,326 1.05 Hold 1.13 8% 41

Non-Financials

Coca-Cola HBC 7,550 20.60 Sell 17.70 -14% 42

OPAP 2,329 7.30 Buy 8.30 14% 44

Titan Cement 1,137 14.75 Sell 12.40 -16% 45

Folli- Follie Group 9312 17.18 Hold 14.50 -16% 46

Jumbo 1,043 8.02 Hold 8.00 0% 47

Mytilineos Holdings 475 4.06 Buy 6.10 50% 50

Hellenic Stock Exchanges 369 5.65 Sell 4.90 -13% 51

Ellaktor 358 2.02 Buy 3.40 68% 52

Terna Energy 306 2.80 Buy 3.45 23% 53

Corinth Pipeworks 247 1.99 Hold 2.10 6% 54

Frigoglass 233 4.60 Hold 5.60 22% 56

Intralot 242 1.52 Buy 2.20 45% 55

EYATH 209 5.76 Hold 5.50 -4% 57

GEK TERNA 179 2.08 Hold 2.50 20% 58

Sidenor 149 1.55 Sell 1.20 -23% 59

Fourlis 120 2.36 Hold 2.70 14% 60

Source: Eurobank Equities Research. Prices as of August 29th

, 2013.

Prices at the close of August 29th

, 2013 used throughout this report

GREEK EQUITY STRATEGY

September 03, 2013

3

EXECUTIVE SUMMARY

GREEK EQUITY STRATEGY

September 03, 2013

4

EXECUTIVE SUMMARY | ROLLING A HARD SIX?

Eight months have passed since we released our last strategy piece and we feel that nothing has really changed from a market perspective. We more or less stand at the same market levels (-8%) vs. last January, when we argued the (2012 H2) rally was finally exhausted. Our crystal ball showed back then that “our base case scenario is that the market will go nowhere in the next 6 months, albeit may exhibit large swings in the meantime”, something we vividly experienced. The Cypriot crisis in March (-15%), the surprisingly painless troika review in May (+40%), the bank recap (-16%), the political crisis due to the national broadcaster shutdown (-18%) and finally the salvation from escaping early national elections (+13%), were the subsequent events that graphically looked like a rollercoaster. The market has been quiet lately but another short relief rally could be staged again as conditions look prime. The upcoming troika review will most likely approve the next Greek loan disbursement, given that conditionalities for certain milestones/prior actions will be met as additional progress has been made lately on both fiscal and structural fronts. Besides, we have argued several times that all that matters is the political will to execute the adjustment program, and, as long as there is no material noncompliance with the EU/IMF, financial aid will be on the table to cover any funding gap in the future despite rolling market pressure ahead of each quarterly review. Furthermore, the upcoming Greek market reclassification from MSCI in Nov to Emerging market status could reignite investors’ interest in Greece. Besides, now that several neighboring emerging market countries face political or social turmoil, investors may seek safety elsewhere and Greece – ironically – could seem like a safe haven attracting significant inflows for a number of stocks. Greek stocks remain at par with other European periphery markets (c7x 2013 EV/EBITDA), despite the rolling earnings and cash flow downgrades every single quarter; a valuation level that does not leave much room for further upside. Although we do recognize a possible opportunistic market reaction from these levels, we really struggle to justify any fundamental reason why Greek stocks deserve a premium. Valuing 2015 or even further out profits at such high multiples or arguing over a quick return to cross cycle earnings defies our logic. Our bottom up methodology shows a potential return of just 6%, very low to meet a typical required return threshold, especially given the risks attached to Greek assets. After all, with high quality (for Greek standards) corporate senior unsecured debt and GGBs yielding 8-10% respectively, we wonder if it is worth climbing down the seniority ladder. Now that the massive bank recap is finally over and the four systemic banks statically report sufficient capital metrics, we think it is time the matter of asset quality be addressed. One should not ignore that the recapitalization was enough to cover the bond losses mostly from the PSI, while loan losses from the 22 consecutive recessionary quarters are still at large, on balance sheet and waiting to be repaired eventually. No matter how this plays out for banks, which in any case are already half-covered excluding collaterals, Greek companies will have to endure the pressure. Obviously the burden first lies with the equity holder – one way or another – to the benefit of the debt holder; however the level of dilution, subordination, deleverage and/or cash flow downgrade clearly varies significantly. Although a full-fledged recovery is not yet in sight, it is true that several economic indicators have been improving or looking less harsh. Most importantly however, any debt relief that may come from the official sector in 2014 – after Greece meets the condition of primary surplus – may significantly improve the odds, providing a stronger platform for growth and employment in the long term, a necessity to sustain political and social cohesion. Nevertheless, at these valuation levels and without yet knowing how domestic authorities will play the NPLs wildcard, we prefer to stay vigilant and opportunistic. We retain our preference for names with robust and sustainable cash flow generation, solid balance sheets, exposure to infrastructure/privatizations and a combination of attractive valuation and/or growth. We reiterate OTE and Metka as preferred picks, while we add EYDAP in our portfolio.

Strong déjàvu feeling

Market opportunism on the

rise…

…but valuation looks full…

…and the 800-pound gorilla

roars

Odds improving

Top picks: OTE, Metka and

EYDAP (new)

GREEK EQUITY STRATEGY

September 03, 2013

Eurobank Equities Investment Firm S.A. Member of Athens Exchange, Cyprus Stock Exchange and Eurobank Group. Regulated by the Hellenic Capital Markets Commission Authorisation No: 6/149/12.1.1999 VAT No: 094543092, Reg. No. 003214701000

10 Filellinon Street 105 57 Athens, Greece

Telephone: +30 210-3720 000

Facsimile: +30 210-3720 001 Website: www.eurobankequities.gr

E-mail: research@eurobankequities.gr

IMPORTANT DISCLOSURES

This report has been issued by Eurobank Equities Investment Firm S.A., a member of the Athens Exchange, a member of the Cyprus Stock Exchange and a member of Eurobank Ergasias S.A. Eurobank Equities Investment Firm S.A., is regulated by the Hellenic Capital Markets Commission (HCMC) with authorization number 6/149/12.1.1999. This report may not be reproduced in any manner or provided to any other persons. Each person that receives a copy by acceptance thereof represents and agrees that it will not distribute or provide it to any other person. This report is not an offer to buy or sell or a solicitation of an offer to buy or sell securities mentioned herein. The investments discussed in this report may be unsuitable for investors, depending on their specific investment objectives and financial position. The investments discussed in this report are subject to risks and in respect of some investments there is risk for multiplied losses to be caused in respect to the capital invested.

The information contained herein has been obtained from sources believed to be reliable but it has not been verified by Eurobank Equities Investment Firm S.A. The opinions expressed herein may not necessarily coincide with those of any member of the Eurobank Group. No representation or warranty (express or implied) is made as to the accuracy, completeness, correctness, timeliness of fairness of the information or opinions herein, all of which are subject to change without notice. No responsibility of liability whatsoever or howsoever arising is accepted in relation to the contents hereof by Eurobank Equities Investment Firm S.A. or any of its directors, officers or employees.

Eurobank Equities Investment Firm S.A. follows procedures under Eurobank Group policies that set up Chinese Walls, restricting communication between Research and other departments inside the Company or the Group so that Eurobank Equities Investment Firm S.A. complies with regulations on confidential information and market abuse.

Eurobank Equities Investment Firm S.A. or any of its related legal persons, does not hold shareholdings exceeding 5% of the total issued share capital in any of the subject companies mentioned in this report, with the exception of Hellenic Post Bank, Eurobank Properties, Lamda Development, Altec, Nikas, Quality & Reliability, Alpha Trust Andromeda, Kardasilaris and to the Cyprus Stock Exchange listed Cyprus Airways Public Ltd.

None of the subject companies mentioned in this report holds shareholdings exceeding 5% of the total issued share capital of Eurobank Equities Investment Firm S.A., or any of its related legal persons, with the exception of Eurobank Ergasias S.A. and National Bank.

Eurobank Equities Investment Firm S.A., or any of its related legal persons, is not a market maker (of stocks or of derivative contracts on stocks) to any of the subject companies mentioned in this report with the exception of National Bank, MIG, Alpha Bank, OTE, Marfin Popular Bank, Viohalco, Piraeus Bank, Titan, Motor Oil, Ellaktor, Mytilineos, PPC, Bank of Cyprus, Hellenic Post Bank, Intralot, Coca Cola Hellenic, OPAP, Hellenic Petroleum, Gek Terna, Hellenic Exchanges, Sidenor, Frigoglass.

Eurobank Equities Investment Firm S.A., or any of its related investment banking services’ legal persons, is not a party to any other agreement relating to the provision of investment banking services, which a) has been in effect over the previous twelve months or b) has given rise during the same period to the payment of a compensation or to the promise to get a compensation paid, with any of the subject companies mentioned in this report with the exception of the following: Athens International Airport, Depa, DOL, Electroniki Athinon, Eurobank, Hellas On Line, Hellenic Petroleum, Hellenic Post Bank, Hygeia, Maillis, Mytilineos, OPAP, Regency Entertainment, Teletipos, Vivartia, EYDAP, Thessaloniki Water & Sewage, Haitoglou Bros, Attica Bank, Selonda Aquaculture, Greek Yellow Pages, Digimed Communications Ltd., Geniki Bank, BlueFin Tuna, S&B.

Eurobank Equities Investment Firm S.A., or any of its related legal persons, is not a party to an agreement relating to the production of this report with the subject companies mentioned in this report.

Analyst Certification: This report has been written by John Kalantzis, Stamatios Draziotis (CFA), Nikos Koskoletos (CFA), Katerina Zaharopoulou, Christina Kouklaki.

Analyst Compensation: The remuneration of John Kalantzis, Stamatios Draziotis (CFA), Nikos Koskoletos (CFA), Katerina Zaharopoulou, Christina Kouklaki is not tied to the investment banking services performed by Eurobank Equities Investment Firm S.A. or any of its related legal persons. John Kalantzis, Stamatios Draziotis (CFA), Nikos Koskoletos (CFA), Katerina Zaharopoulou, Christina Kouklaki did not receive or purchase the shares of the subject companies mentioned in this report prior to a public offering of such shares.

Planned Frequency of Updates: Eurobank Equities Investment Firm S.A. provides daily and monthly updates as well as updates on companies based on company-specific developments or quarterly financial results announcements or any other publicly available information.

Eurobank Equities Investment Firm S.A. Rating System: Stock Ratings Coverage Universe Investment Banking Clients Count Total Count Total Buy 8 30% 3 38% Hold 9 33% 1 11% Sell 4 15% 0 0% Restricted 3 11% 1 33% Under Review 3 11% 0 0% Total 27 100%

Analyst Stock Ratings:

Buy: Based on a current 12-month view of total shareholder return (percentage change in share price to projected target price plus projected dividend yield), we recommend that investors buy the stock.

Hold: We adopt a neutral view on the stock 12-months out and, on this time horizon, do not recommend either Buy or Sell.

Sell: Based on a current 12-month view of total shareholder return, we recommend that investors sell the stock.

Restricted: Under Eurobank Group policy and / or regulations which do not allow ratings

Under Review: Our estimates, target price and recommendation are currently under review.