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THAILAND EQUITY RESEARCH

Page | 1 | PHILLIP SECURITIES (THAILAND)

AP (Thailand)

More growth ahead

THAILAND | SET | PROP | COMPANY REPORT BLOOMBERG AP TB l REUTERS AP.BK Stellar showing in FY17 AP reported a set of strong presales numbers in FY17. Total presales clocked in at Bt42.9bn, which was 65% above its target of Bt26bn thanks largely to stronger-than-expected condo presales on the back of an overwhelming response for its newly launched condo projects and a 9% beat in SDH/TH presales. Revenue came in line with its target at Bt22bn while revenue at its JV with Mitsubishi Real Estate also matched its target at Bt6.2bn. FY17 profit seen up 14% y-y We expect AP to deliver profit growth of 14% y-y to Bt3bn in FY17 from Bt2.7bn in FY16 on the back of rising revenue, stable margins, tight expense controls and higher profit from JV. For the year, revenue is estimated to be 7% higher than a year earlier at Bt21bn while the share of profit from JV is projected to rise 26% y-y to Bt466mn from Bt370mn a year ago. We also forecast AP to shell out a dividend of Bt0.37/share for FY17. FY18 revenue growth target set at 9% though presales set to drop 22% in line with new project launch plan AP plans to roll out 34 new projects this year, up from 24 projects last year but the total value of new project launches is on par with last year at Bt49bn. Under the plan, much of the focus will shift to SDH/TH rather than condo launches as reflected by a 20% increase in the value of new SDH/TH launches to Bt30bn this year from Bt25bn last year. The value of new condo launches on the other hand drops by 21% to Bt19bn this year from Bt24bn last year. With the above new project launch plan, management has guided for a drop of 22% y-y in FY18 total presales on expectations that (i) SDH/TH presales will rise 21% y-y, and (ii) condo presales will drop 45% y-y. Even though presales are expected to drop in FY18, management has set a revenue growth target of 9% to Bt23.2bn for FY18, of which around Bt6bn would come from backlog carried over from end-FY17 into FY18 and the rest from SDH/TH revenue and sales of condo inventories earned during the year. For its JV with Mitsubishi Real Estate, the revenue target is set at Bt8bn for FY18, of which around Bt7.4bn or 93% has already been covered by backlog. Strong run of profit growth set to continue into FY18 We expect AP to enjoy a strong run of profit growth well into FY18 on the back of further revenue expansion and higher share of profit from JV. As our view is generally in line with management’s guidance, we therefore nudge our FY18 profit outlook for AP higher by 5% to reflect the above business targets. We forecast its revenue will grow further by 9% y-y to Bt23.1bn in FY18. Even though AP has a backlog of only Bt6bn carried over into FY18, we believe better SDH/TH revenue and sales of condo inventories should put it on course to meet the target. Margins tend to be a bit higher while SG&A expenses should remain well under control. The share of profit from JV is predicted to rise 31% y-y to Bt609mn in FY18 from an estimate of Bt466mn in FY17 on expectations that JV will see its revenue rise further by 27% y-y. On this basis, we now expect AP to achieve sequential profit growth of 14% y-y in FY18. Compelling valuation in relative P/E terms with dividend yield of between 4%-5% We believe AP continues to deserve a ‘BUY’ rating in light of its continued strong profit growth profile for FY18 and compelling valuations with a dividend yield of roughly 4%-5%. At current valuation levels of 7x P/E, AP is still trading at a big discount to its historical average of 9x while it is also expected to dole out a dividend of Bt0.34/share and Bt0.39/share for FY17-FY18 respectively, translating into a yield of between 4%-5%. The above profit upgrade also leads us to bump up our FY18 target price for AP to Bt10/share.

Ref. No.: CO2018_0119

Closing Price(Bt) 8.55

Target Price(Bt) 10.00 (+21.51%)

COMPANY DATA

O/S Shares (mn) : 3,146

Market Cap. (Btmn) :

Market Cap. (USDmn) :

52‐WK Hi/Lo (Bt) : 9.45/6.95

3M Average Daily T/O (mn) : 10.28

Par Value (Bt) : 1.00

MAJOR SHAREHOLDERS (%)

1. Mr. Anupong Asavapokin 21.3

2. Thai NVDR Co.,Ltd. 9.7

3. NORTRUST NOMINEES LTD‐CL AC 6.2

PRICE PERFORMANCE (%)

1MTH 3MTH 1YR

ABS ‐7% ‐6% 16%

REL TO SET INDEX ‐5% ‐10% 1%

PRICE VS SET INDEX

Source: Bloomberg, PSR

KEY FINANCIALS

FYE Dec FY15 FY16 FY17E FY18E

Sales(Btmn) 22,203 20,336 22,010 24,059

Net Profit(Btmn) 2,623 2,703 3,073 3,501

EPS (Bt) 0.83 0.86 0.98 1.11

P/E (X) 10.3 10.0 8.8 7.7

BVPS (Bt) 5.53 6.08 6.76 7.53

P/B (X) 1.5 1.4 1.3 1.1

DPS (Bt) 0.30 0.30 0.34 0.39

Dividend Yield (%) 3.5 3.5 4.0 4.6

ROE (%) 15.66 14.58 15.00 15.38

Debt/Equity (X) 1.47 1.45 1.44 0.93

Source: Company, PSR Est.

**Multiples and yields are based on latest closing price

VALUATION METHOD

P/E'18 (9x)

Danai Tunyaphisitchai, CFA

Capital Market Investment Analyst # 2375

Tel: 66 2 635 1700 # 481

15 February 2018

26,897

854

12 May 2017

Buy (Maintain)

0

3

6

9

12

15

Feb‐15 Feb‐16 Feb‐17 Feb‐18

AP TB EQUITY SETI (rebased)


AP (Thailand) COMPANY REPORT

Investment Thesis AP notched stunning presales growth in FY17 and was one of the few

listed developers that beat full-year presales target. As revenue came in line with its target, we expect AP to deliver 14% y-y profit growth for FY17.

In our view, revenue should continue to be a key profit driver for AP in FY18 on the back of organic revenue growth and contribution from JV though management has guided for a drop of 22% y-y in FY18 total presales on expectations that condo presales will falter following the shift of focus to SDH/TH rather than condo launches. We also expect AP to achieve sequential profit growth of 14% y-y in FY18.

We believe AP continues to deserve a ‘BUY’ rating in light of its continued strong profit growth profile for FY18 and compelling valuations with a dividend yield of roughly 4%-5%. At current valuation levels of 7x P/E, AP is still trading at a big discount to its historical average of 9x while it is also expected to dole out a dividend of Bt0.34/share and Bt0.39/share for FY17-FY18 respectively, translating into a yield of between 4%-5%. The slight profit upgrade also leads us to bump up our FY18 target price for AP to Bt10/share.

Stellar showing in FY17 AP put in a stellar showing in terms of total presales and revenue in FY17. (1) Total presales clocked in at Bt42.9bn, which was 65% above its target of

Bt26bn due largely to stronger-than-expected condo presales. For the year, condo presales surpassed its forecast of Bt12.4bn at Bt28.1bn thanks chiefly to an overwhelming response for its three newly launched condo projects worth a combined value of Bt24.7bn, which had an average take-up rate of up to 89%, translating into presales of approximately Bt21.9bn. SDH/TH presales also exceeded its Bt13.6bn target by 9% at Bt14.8bn as its SDH/TH projects fitted homebuyers’ needs in terms of design and locations.

(2) Revenue came in line with its target at Bt22bn. Notwithstanding that AP had a backlog of only Bt4.6bn carried over from FY16 into FY17, solid SDH/TH revenue and brisk sales of condo inventories helped put it back on track to meet full-year revenue target. On the other hand, revenue at its JV with Mitsubishi Real Estate also matched its target at Bt6.2bn, of which Bt4.8bn came from backlog at the beginning of the year and the remaining Bt1.2bn from revenue earned during the year.

FY17 profit growth likely to meet target We expect AP to deliver profit growth of 14% y-y to Bt3bn in FY17 from Bt2.7bn in FY16 on the back of rising revenue, stable margins, tight expense controls and higher profit from JV. For the year, revenue is estimated to be 7% higher than a year earlier at Bt21bn on expectations that 4QFY17 revenue will come in at Bt7.7bn, of which (i) Bt5.7bn will come from backlog at end-3QFY17, (ii) Bt1.7bn from revenue realized from SDH/TH presales of Bt3.1bn during the period, and (iii) another Bt300mn from sales of condo inventories. AP achieved revenue of Bt13.3bn in 9MFY17. Margins should remain stable and SG&A expenses would remain well under control. The share of profit from JV is also projected to rise 26% y-y to Bt466mn from Bt370mn a year ago based on assumption that JV saw its revenue jump 32% y-y to Bt6.2bn. FY18 revenue growth target set at 9% though presales set to drop 22% in line with new project launch plan AP plans to roll out 34 new projects this year, up from 24 projects last year but the total value of new project launches is on par with last year at Bt49bn. Under the plan, much of the focus will shift to SDH/TH rather than condo launches as reflected by a 20% increase in the value of new SDH/TH launches to Bt30bn this year from Bt25bn last year. The value of new condo launches on the other hand drops by 21% to Bt19bn this year from Bt24bn last year. AP will stick to its strategy of forming JV to develop large condo projects and launch more SDH/TH projects in new market segments to diversity risks and differentiate itself from its rivals. With the above new project launch plan, management has guided for a drop of 22% y-y in FY18 total presales on expectations that (i) SDH/TH presales will rise 21% y-y amid an increasing


AP (Thailand) COMPANY REPORT number of project launches, and (ii) condo presales will drop 45% y-y due to a high base effect of FY17 when the figures were inflated by a surprisingly strong take-up rate of 89% for its newly launched projects compared to normal levels of between 40%-60%. Even though presales are expected to drop in FY18, management has set a revenue growth target of 9% to Bt23.2bn for FY18, of which around Bt6bn would come from backlog carried over from end-FY17 into FY18 and the rest from SDH/TH revenue and sales of condo inventories earned during the year. For its JV with Mitsubishi Real Estate, the revenue target is set at Bt8bn for FY18, of which around Bt7.4bn or 93% has already been covered by backlog. Strong run of profit growth set to continue into FY18 We expect AP to enjoy a strong run of profit growth well into FY18 on the back of further revenue expansion. As our view is generally in line with management’s guidance, we therefore nudge our FY18 profit outlook for AP higher by 5% to reflect the above business targets. Even though AP has a backlog of only Bt6bn carried over into FY18, we forecast its revenue will grow further by 9% y-y to Bt23.1bn on expectations that it will realize revenue of around Bt14bn from projected SDH/TH presales of Bt18bn in FY18, and it will recognized condo revenue of Bt3.1bn from the Bt3.5bn super luxury Vittorio Sukhumvit 39 and the remaining Bt3.5bn value of condo inventories. Margins tend to be a bit higher while the share of profit from JV is predicted to rise 31% y-y to Bt609mn in FY18 from an estimate of Bt466mn in FY17 on expectations that JV will see its revenue rise further by 27% y-y. On this basis, we now expect AP to achieve sequential profit growth of 14% y-y in FY18. Compelling valuation in relative P/E terms with dividend yield of between 4%-5% We believe AP continues to deserve a ‘BUY’ rating in light of its continued strong profit growth profile for FY18 and compelling valuations with a dividend yield of roughly 4%-5%. At current valuation levels of 7x P/E, AP is still trading at a big discount to its historical average of 9x while it is also expected to dole out a dividend of Bt0.34/share and Bt0.39/share for FY17-FY18 respectively, translating into a yield of between 4%-5%. The above profit upgrade also leads us to bump up our FY18 target price for AP to Bt10/share.



Financials

Income Statement Cash Flow

FYE Dec, Btmn FY15 FY16 FY17E FY18E FYE Dec, Btmn FY15 FY16 FY17E FY18E

Revenue 22,203 20,336 22,010 24,059 CFO

EBITDA 3,698 3,070 3,463 3,872 PBT 3,356 3,321 3,787 4,224

Depreci a ti on & Amorti s a ti on 50 42 49 54 Adjus tments 400 ‐200 ‐302 ‐343

EBIT 3,648 3,028 3,413 3,819 WC changes ‐2,907 ‐2,243 ‐4,083 4,819

Net Finance (Expense )/Inc ‐257 ‐182 ‐174 ‐205 Ca sh genera ted from ops 849 878 ‐599 8,700

Othe r i tems 137 84 65 0 Others ‐1,318 ‐1,275 ‐1,498 ‐1,406

As socia te s & JVs ‐207 371 467 610 Cashflow from ops ‐468 ‐397 ‐2,097 7,294

Excepti ona l i tems 137 84 65 0 CFI

Profit Before Tax 3,322 3,300 3,770 4,224 CAPEX, net ‐29 ‐31 ‐221 ‐80

Ta xa ti on ‐699 ‐598 ‐703 ‐723 Others 198 ‐702 ‐712 ‐1,927

Profit After Tax 2,623 2,703 3,067 3,501 Cashflow from investments 169 ‐732 ‐933 ‐2,007

Non ‐control l i ng Inte res t 0 0 ‐6 0 CFF

Net Income, reported 2,623 2,703 3,073 3,501 Sha re i s s ua nce 0 0 0 0

Net Income, adj. 2,486 2,619 3,008 3,501 Loans , net of repa yments 278 2,142 5,302 ‐6,200

Di vi dends ‐818 ‐944 ‐944 ‐1,075

Per share data Others ‐0 0 5 0

FYE Dec, Bt FY15 FY16 FY17E FY18E Cashflow from financing ‐540 1,199 4,362 ‐7,275

EPS, reported 0.83 0.86 0.98 1.11 Net change in cash ‐838 69 1,333 ‐1,988

EPS, adj. 0.79 0.83 0.96 1.11 Effe cts of exchange ra tes 0 0 0 0

DPS 0.30 0.30 0.34 0.39 CCE, end 421 1,087 2,540 551

BVPS 5.53 6.08 6.76 7.53

Valuation Ratios

Balance Sheet FYE Dec FY15 FY16 FY17E FY18E

FYE Dec, Btmn FY15 FY16 FY17E FY18E P/E (X), adj.** 10.8 10.3 8.9 7.7

Ca sh 421 1,087 2,540 551 P/B (X), adj.** 1.5 1.4 1.3 1.1

Inves tments 0 0 0 0 Di vi dend Yie ld (%) 3.5 3.5 4.0 4.6

Accounts Rece i va bles 72 40 95 95

Inventori e s 31,938 30,743 32,131 27,814 Growth

Othe rs 850 1,249 705 705 FYE Dec, % FY15 FY16 FY17E FY18E

Total current assets 33,281 33,118 35,471 29,166 Revenue ‐4.28 ‐8.41 8.23 9.31

PPE 103 94 271 297 EBITDA 0.20 ‐16.98 12.79 11.83

Inta ngibl e s 48 73 69 69 EBIT 0.20 ‐17.01 12.75 11.87

As socia te s & JVs 1,694 3,526 4,600 7,138 Net Income, adj. ‐4.88 5.33 14.88 16.38

Inves tments 597 607 607 607

Othe rs 425 371 423 423 Margins

Total non‐current assets 2,866 4,672 5,970 8,534 FYE Dec, % FY15 FY16 FY17E FY18E

Total Assets 36,147 37,790 41,441 37,700 EBITDA ma rgin 16.66 15.10 15.73 16.10

Short te rm l oans 3,980 6,441 8,342 5,892 EBIT ma rgin 16.43 14.89 15.51 15.87

Accounts Payable s 1,071 924 659 603 Net Profi t Margin 11.82 13.29 13.96 14.55

Othe rs 2,399 2,356 2,072 2,152

Total current liabilities 7,451 9,721 11,073 8,647 Key Ratios

Long te rm l oans 10,699 8,300 8,441 4,691 FYE Dec FY15 FY16 FY17E FY18E

Othe rs 343 345 375 384 ROE (%) 15.66 14.58 15.00 15.38

Total liabilities 18,493 18,366 19,889 13,723 ROA (%) 7.32 7.31 7.76 8.85

Non ‐control l i ng i nte res ts 0 1 ‐1 ‐1 Net Debt/(Ca sh) (Btmn) 14,258 13,654 14,244 10,032

Shareholder Equities 17,654 19,423 21,553 23,978 Net Gea ring (X) 0.71 0.71 0.69 0.58

La tes t clos i ng pri ce

Source : Company Da ta , PSR es t

**Based on latest closing price



Fact Sheet

GENERAL INFORMATION RISK FACTORS

Address : 1. Economic growth/employment rate/interest rates

2. Demand‐supply equi l ibrium in the res identia l property market

3. Government investment pol icy

Tel :

Fax:

URL:

Market/Sector:

BUSINESS DESCRIPTION KEY DEVELOPMENT

PRESALES BREAKDOWN 2017 KEY FINANCIAL SUMMARY

Btmn 3Q17 2Q17 1Q17 4Q16 3Q16

Sales 4,939 4,798 4,200 7,203 4,448

Gross profi t 1,809 1,647 1,376 2,458 1,564

Net profi t 637 613 549 1,256 457

Assets 41,465 40,793 40,069 37,790 37,485

Liabi l i ties 21,188 21,157 20,096 18,366 19,337

Equities 20,277 19,637 19,973 19,424 18,148

EPS (Bt) 0.20 0.19 0.17 0.40 0.15

BVPS (Bt) 6.45 6.24 6.35 6.17 5.77

GPM (%) 37% 34% 33% 34% 35%

NPM (%) 13% 13% 13% 17% 10%

Source: Company, PSR Source: Company, PSR

REVENUE, EQUITY INCOME, PROFIT PEER COMPARISON * updated on

as of Mkt Cap. P/E P/BV Div Yield

(Btmn) (x) (x) (%)

AP Thai land PCL

AP TB 9/17 26,897 8.8 1.4 3.5

Pruksa Holding PCL

PSH TB 9/17 51,608 9.0 1.5 5.8

Qual i ty Houses PCL

QH TB 9/17 33,000 10.2 1.4 4.9

Supala i PCL

SPALI TB 9/17 42,910 7.5 1.7 2.4

Source: Bloomberg, PSR

Source: Company, PSR

Ocean Tower 1, 18FL, 170/57

Ratchada Rd, Klongtoey, Bangkok

Property Development

AP is one of Thai land’s leading property developers . Its project

portfol io includes townhouses , s ingle ‐detached houses and

condominiums.

Company

name

‐Yr 2015: After good presa les on JV projects , AP went on

launching 3 more projects with good take‐up rate of 80%.

‐Yr 2014: Formed JV with Mitsubishi Estate Group to co‐develop

condo projects and launched 4 projects with good presa les of

‐Yr 2013: Corporate name was changed to AP Thai land from

Asean Property Development

14 February 2018

*Data based on tra i l ing 12 months earnings , book value and

dividend per share

30 September 2017

66 2 261 2518

66 2 261 2548

http://www.apthai .com

DH/TH , 34%

CD, 10%

CD‐JV, 55%

‐400

‐200

0

200

400

1,500

6,500

11,500

16,500

21,500

2013 2014 2015 2016

Revenue NET PROFIT EQUITY INCOME



Corporate Governance ‐ 2017

ADVANC AKP ANAN AOT AP BAFS BANPU BAY BCP BIGC

BTS BWG CFRESH CHO CK CNT CPF CPN CSL DELTA

DEMCO DRT DTAC DTC EASTW EGCO GC GCAP GFPT GOLD

GPSC GRAMMY GUNKUL HANA HMPRO ICC ICHI INTUCH IRPC IVL

JSP KBANK KCE KKP KTB KTC LHBANK LPN MBK MCOT

MINT MONO NCH NKI NYT OTO PHOL PLANB PPS PRANDA

PRG PSH PSL PTG PTT PTTEP PTTGC PYLON Q‐CON QH

QTC RATCH ROBINS SAMART SAMTEL SAT SC SCB SCC SCCC

SE‐ED SIM SIS SITHAI SNC SPALI SPRC SSSC STEC SVI

SYNTEC TCAP THANA THCOM THREL TISCO TKT TMB TNDT TOP

TRC TRUE TSC TTCL TU TVD UV VGI WACOAL WAVE

2S AAV ACAP AGE AH AHC AIRA AIT ALT AMANAH

AMATA AMATAV APCO ARIP ASIA ASIMAR ASK ASP AUCT AYUD

BBL BCPG BDMS BEC BEM BFIT BJC BJCHI BLA BOL

BROOK BRR BTW CEN CENTEL CGH CHARAN CHEWA CHG CHOW

CI CIG CIMBT CKP CM CNS COL COM7 CPI CSC

CSP CSS DCC EA EASON ECF ECL EE EPG ERW

FN FNS FORTH FPI FSMART FVC GBX GEL GLOBAL GLOW

HARN HOTPOT HYDRO ILINK INET IRC IT ITD JWD K

KGI KKC KOOL KSL KTIS L&E LALIN LANNA LH LHK

LIT LOXLEY LRH LST M MACO MAJOR MAKRO MALEE MBKET

MC MEGA MFC MFEC MOONG MSC MTI MTLS NOBLE NOK

NSI NTV NWR OCC OGC OISHI ORI PAP PATO PB

PCSGH PDI PE PG PJW PLANET PLAT PM PPP PR

PREB PRINC PT RICHY RML RS RWI S S & L SABINA

SALEE SAMCO SAWAD SCG SCI SCN SEAFCO SEAOIL SENA SFP

SIAM SINGER SIRI SMK SMPC SMT SNP SORKON SPC SPI

SPPT SR SSF SST STA STPI SUC SUSCO SUTHA SWC

SYMC SYNEX TAE TAKUNI TASCO TBSP TCC TEAM TF TFG

TGCI THAI THANI THIP THRE TICON TIPCO TIW TK TKN

TKS TMC TMI TMILL TMT TNITY TNL TOG TPAC TPCORP

TRT TRU TSE TSR TSTE TSTH TTA TTW TVI TVO

TWP TWPC U UAC UMI UP UPF UPOIC UWC VIH

VNT WICE WINNER XO YUASA ZMICO

AEC AEONTS AF AJ AKR ALLA ALUCON AMA AMARIN AMC

APURE AQUA ARROW AS ASEFA ASIAN ASN ATP30 AU BA

BCH BEAUTY BH BIG BIZ BLAND BPP BR BROCK BTC

BTNC CBG CCET CCP CGD CITY CMR COLOR COMAN CPL

CSR CTW CWT DCON DIGI DNA EFORL EKH EPCO ESSO

ETE FE FER FOCUS FSS GENCO GIFT GJS GLAND GSTEL

GTB GYT HPT HTC HTECH IFS IHL INSURE IRCP J

JMART JMT JUBILE KASET KBS KCAR KIAT KWC KYE LDC

LEE LPH MATCH MATI M‐CHAI MDX METCO MGT MILL MJD

MK MODERN MPG NC NCL NDR NEP NETBAY NPK NPP

NUSA OCEAN PDG PF PICO PIMO PK PL PLE PMTA

PRECHA PRIN PSTC QLT RCI RCL RJH ROJNA RPC S11

SANKO SAPPE SCP SE SGP SKR SKY SLP SMIT SOLAR

SPA SPCG SPG SPVI SQ SRICHA SSC STANLY SUPER SVOA

T TACC TCCC TCMC TFD TIC TLUXE TM TMD TNP

TNR TOPP TPA TPBI TPCH TPIPL TPOLY TPP TRITN TTI

TVT TYCN UOBKH UPA UREKA UT VIBHA VPO VTE WIIK

WIN

Score Range

< 50%

50‐59%

60‐69%

70‐79%

80‐89%

90‐100%

The disclosure of the survey result of the Thai Institute of Directors Association (IOD)

regarding corporate governance is made pursuant to the Office of the Securities and

Exchange Commission. The survey of the IOD is based on the information of a company

l isted on the Stock Exchange of Thailand and the Market for Alternative disclosure to the

public and able to be accessed by a general public investor. The results, therefore, is from

the perspective of a third party. It is not an evaluation of operation and is not based on

inside information.

The survey result is as of the date appearing in the Corporate Governance Report of Thai

Listed Companies. As a result, the survey result may be changed after that data. Phil l ip

Securities (Thailand) of securities company does not confirm nor certify the accuracy of

such survey result.

No logo given

Number of Logo

Results Presentation



Declared

A AI AIE AIRA AJ ALUCON AMATAV AOT APCO AQUA

ARROW ASIA ASK AU BCH BJC BJCHI BLAND BR BROCK

BRR CEN CGH CHEWA CHG CHOTI CHOW CIG COL COM7

CPALL CPF CPR CSC EKH EPCO FC FER FPI FSMART

GEL GFPT GGC GIFT GJS GLOBAL GOLD GPSC GREEN GSTEL

GUNKUL HARN IFS ILINK INET IRC J JMART JMT JUBILE

JUTHA KASET KBS KCAR KTECH KWC KYE L&E LEE LIT

LVT MAKRO MATCH MATI MBAX MC MFEC MIDA MILL ML

MTLS NBC NCL NEP NINE NMG NNCL NTV NUSA NWR

OGC PACE PAF PAP PATO PCSGH PIMO PK PL PLANB

POST PRINC PRO PSTC PYLON QTC ROH ROJNA RWI SANKO

SAUCE SC SCCC SCN SEAOIL SE‐ED SENA SIRI SMART SPACK

SPPT SPRC SR SRICHA SST STA SUPER SUSCO SWC SYMC

TAKUNI TBSP TFI THE TICON TIP TKN TLUXE TMILL TMT

TNP TPA TRUE TSE TTI TU TVD TVO TVT TWPC

U UPA UREKA UWC VGI VIBHA VIH VNT WAVE WHA

WICE WIIK

Certified

ADVANC AKP AMANAH AP ASP AYUD BAFS BANPU BAY BBL

BCP BKI BLA BROOK BTS BWG CENTEL CFRESH CIMBT CM

CNS CPI CPN CSL DCC DEMCO DIMET DRT DTAC DTC

EASTW ECL EGCO FE FNS FSS GBX GCAP GLOW HANA

HMPRO HTC ICC IFEC INTUCH IRPC IVL K KBANK KCE

KGI KKP KSL KTB KTC LANNA LHBANK LHK LPN MBK

MBKET MCOT MFC MINT MONO MOONG MSC MTI NKI NSI

OCC OCEAN PB PDI PE PG PHOL PLAT PM PPP

PPS PRANDA PREB PRG PSH PSL PT PTG PTT PTTEP

PTTGC Q‐CON QH QLT RATCH RML ROBINS S & J SABINA SAT

SCB SCC SCG SGP SINGER SIS SITHAI SMIT SMPC SNC

SNP SORKON SPC SPI SSF SSI SSSC SVI SYNTEC TAE

TCAP TCMC TFG TGCI THANI THCOM THRE THREL TIPCO TISCO

TKT TMB TMD TNITY TNL TOG TOP TPCORP TRU TSC

TSTH TTCL TVI UOBKH WACOAL

Non‐participation

2S AAV ABICO ACAP ACC ADAM AEC AEONTS AF AFC

AGE AH AHC AIT AJA AKR ALLA ALT AMA AMARIN

AMATA AMC ANAN APCS APEX APURE AQ ARIP AS ASAP

ASEFA ASIAN ASIMAR ASN ATP30 AUCT BA BAT‐3K BCPG BDMS

BEAUTY BEC BEM BFIT BGRIM BGT BH BIG BIZ BKD

BLISS BM BOL BPP BSBM BSM BTC BTNC BTW BUI

CBG CCET CCP CGD CHARAN CHO CHUO CI CITY CK

CKP CMO CMR CNT COLOR COMAN CPH CPL CRANE CRD

CSP CSR CSS CTW CWT D DCON DCORP DELTA DIGI

DNA DTCI EA EARTH EASON ECF EE EFORL EIC EMC

EPG ERW ESSO ESTAR ETE EVER F&D FANCY FMT FN

FOCUS FORTH FTE FVC GC GENCO GL GLAND GRAMMY GRAND

GTB GYT HFT HOTPOT HPT HTECH HYDRO ICHI ICN IEC

IHL III INGRS INOX INSURE IRCP IT ITD ITEL JAS

JCT JSP JTS JWD KAMART KC KCM KDH KIAT KKC

KOOL KTIS KWG LALIN LDC LH LOXLEY LPH LRH LST

LTX M MACO MAJOR MALEE MANRIN MAX M‐CHAI MCS MDX

MEGA METCO MGT MJD MK MM MODERN MPG MPIC NC

NCH NDR NETBAY NEW NEWS NFC NOBLE NOK NPK NPP

NVD NYT OHTL OISHI ORI OTO PAE PDG PERM PF

PICO PJW PLANET PLE PMTA POLAR POMPUI PPM PRAKIT PRECHA

PRIN PRM PTL RAM RCI RCL RICH RICHY RJH ROCK

RP RPC RPH RS S S11 SAFARI SALEE SAM SAMART

SAMCO SAMTEL SAPPE SAWAD SAWANG SCI SCP SDC SE SEAFCO

SELIC SF SFP SGF SHANG SIAM SIMAT SKN SKR SKY

SLP SMK SMM SMT SOLAR SPA SPALI SPCG SPG SPORT

SPVI SQ SSC SSP STANLY STAR STEC STHAI STPI SUC

SUTHA SVH SVOA SYNEX T TACC TAPAC TASCO TC TCB

TCC TCCC TCJ TCOAT TEAM TFD TFMAMA TGPRO TH THAI

THANA THIP THL TIC TIW TK TKS TM TMC TMI

TMW TNDT TNH TNPC TNR TOA TOPP TPAC TPBI TPCH

TPIPL TPIPP TPOLY TPP TR TRC TRITN TRT TRUBB TSF

TSI TSR TSTE TTA TTL TTTM TTW TUCC TWP TWZ

TYCN UAC UBIS UEC UKEM UMI UMS UNIQ UP UPF

UPOIC UT UTP UV UVAN VARO VI VNG VPO VTE

WG WHAUP WIN WINNER WORK WORLD WP WPH WR XO

YCI YNP YUASA ZIGA ZMICO

Companies participating in Thailand's Private Sector Collective Action Coalition Against

Corruption programme (Thai CAC) under Thai Institute of Directors (as of July 31, 2017)

PHILLIP SECURITIESS (THAILAND) | 8 | P a g e


The SEC ha s a pol i cy to promote l i s ted companie s and i nte rmedia ri e s , i .e . s ecuri ti e s companie s , a s s e t management companie s , deri va ti ve bus i ne s s companie s

(“i nte rmedi a ri e s ”) to es tabl i s h anti ‐corruption mea sure s a s pa rt of the i r bus i ne s s opera ti on. The SEC ha s s upported Tha ipa t Ins ti tute i n deve loping the Anti ‐corrupti on

Progres s Indi ca tor of l i s ted companie s and i nte rmedia ri e s . The Indi ca tor compri s es fi ve l e ve l s : Leve l 1: Commi tted, Leve l 2: Decla red, Leve l 3: Es tabl i s hed,

Leve l 4: Certi fi ed, and Leve l 5: Extended.

The SEC conti nues to deve lop bus ine s s s us ta inabi l i ty among l i s ted companies and i nte rmedi a ri e s wi th a focus on anti ‐corrupti on by s upporting them to jo in Tha i l a nd’s

Pri va te Sector Col l e cti ve Action Coa l i ti on Aga ins t Corruption (CAC) and to di s clos e the i r corpora te gove rnance progres s on http://www.cgtha i l a nd.org.

Levels of Commitment

Companies participating in Thailand's Private Sector Collective Action Coalition Against Corruption

programme (Thai CAC) under Thai Institute of Directors (as of July 31, 2017)

PHILLIP SECURITIESS (THAILAND) | 9 | P a g e


Industry Group Name Sector Name Sector Index

Agro & Food Industry[AGRO] Agribusiness AGRI

Food & Beverage FOOD

Consumer Products[CONSUMP] Fashion FASHION

Home & Office Products HOME

Personal Products & Pharmaceuticals PERSON

Financials [FINCIAL] Banking BANK

Finance & Securities FIN

Insurance INSUR

Industrials [INDUS] Automotive AUTO

Industrial Materials & Machinery IMM

Packaging PKG

Paper & Printing Materials PAPER

Petrochemicals & Chemicals PETRO

Steel STEEL

Property & Construction[PROPCON] Construction Materials CONMAT

Construction Services CONS

Property Development PROP

Property Fund & REITs PF&REIT

Resources [RESOURC] Energy & Util ities ENERG

Mining MINE

Services [SERVICE] Commerce COMM

Media & Publishing MEDIA

Health Care Services HELTH

Tourism & Leisure TOURISM

Professional Services PROF

Transportation & Logistics TRANS

Technology [TECH] Electronic Components ETRON

Information & Communication Technology ICT

PSR Rating SystemCapital Gain Recommendation

> 15% BUY

> 5% ‐ 15% ACCUMULATE / TRADING BUY

> 0% ‐ 5% NEUTRAL

0 <= SELL

Remarks

We do not base our recommendations entirely on the above quantitative return bands. We consider qualitative factors l ike (but

not l imited to) a stock's risk reward profi le, market sentiment, recent rate of share price appreciation, presence or absence of

stock price catalysts, and speculative undertones surrounding the stock, before making our final recommendation

Contact Information of Hong Kong Representatives

Research

Benny WANG

Dealing Director

(852) 2277 6720

[email protected]

ZHANG Jing

Research Analyst

Transportation and Automobiles

(86) 21 51699400-103

[email protected]

John WONG

Research Analyst

HK & Mainland Properties, Hotels &

Entertainment

(852) 2277 6527

[email protected]

Sales

FAN Guohe

Research Analyst

Pharmaceutical, Health & Personal Care, TMT

(86) 21 51699400-110

[email protected]

WANG Yannan

Research Analyst

New Energy

(86) 21 51699400-107

[email protected]

Aric AU Matthew WONG

Manager, Corporate & Institutional Sales Manager, International Sales

(852) 2277 6783 (852) 2277 6678

[email protected] [email protected]

Yoshikazu SHIKITA

Manager, International Sales

(Japan Team)

(852) 2277 6624

[email protected]

PHILLIP RESEARCH STOCK SELECTION SYSTEMS

Total Return Recommendation Rating Remarks

> +20% Buy 1 >20% upside from the current price

+5% to +20% Accumulate 2 +5% to +20% upside from the current price

-5% to +5% Neutral 3 Trade within +/- 5% from the current price

-5% to -20% Reduce 4 -5% to -20% downside from the current price

< -20% Sell 5 -20% downside from the current price

We do not base our recommendations entirely on the above quantitative return bands. We consider qualitative factors like (but not limited to) a stock’s risk reward profile, market sentiment, recent rate of share price appreciation, presence or absence of stock price catalysts, and speculative undertones surrounding the stock, before making our final recommendation

GENERAL DISCLAIMER

This publication is distributed in Hong Kong by Phillip Securities (Hong Kong) Limited (“PSHK”), which is licensed in Hong Kong by the Securities and Futures Commission for regulated activities, including Type 4 regulated activity (advising on securities). This publication was originally prepared by analysts from our overseas affiliates. The information contained herein is based on sources that PSHK and its affiliates believe to be accurate and any analysis, forecasts, projections, expectations and opinions contained in this publication are based on such information and are expressions of belief only. This material is prepared for general circulation to clients and is not intended to provide tailored investment advice and does not take into account the individual financial situation and objectives of any specific

person who may receive this report. Investors should seek financial advice regarding the appropriateness of any investments or securities discussed or recommended in this report. This report is not (and should not be construed as) a solicitation to act as securities broker or dealer in any jurisdiction by any person or company that is not legally permitted to carry on such business in that jurisdiction. This research report may not be redistributed, retransmitted or disclosed, in whole or in part or and any form or manner, without the express written consent of PSHK. Please direct any enquiries to [email protected].

Investment involves risks. For details of product risks, please view the Risk Disclosures Statement on http://www.phiIlip.com.hk.

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