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Offshore & Marine SINGAPORE August 14, 2012

IMPORTANT DISCLOSURES. INCLUDING ANY REQUIRED RESEARCH CERTIFICATIONS, ARE PROVIDED AT THE END OF THIS REPORT.Designed by Eight, Powered by EFA

Antithesis of the Facebook IPO At 50% of our FY12 estimate, SOH’s 1H12 core net profit is in line. Onceunloved, once unheralded, SOH has delivered total shareholder returnsof 135% since its end-2010 IPO. Despite the noise of a potential stake byits Korean parent, SOH continues to deliver steady results.

At 26% of our FY12 forecast, 2Q is inline with our expectation and

consensus. No changes to our EPSestimates or target price (11x CY13P/E, 10% discount to rigbuilders’5-year rolling forward core P/E meanof 12x). Maintain Outperform.

Performance in line; bumperdividend surpriseSOH recorded 13.8% EBITDA marginin 2Q, in line with our expectation of14%. The good margin resulted fromstable operations in a soft suppliers'market. One red flag, though, is thatthe existing Niteroi yard in Brazil isexperiencing delays due to supplierconstraints. That said, the financialimpact of the delays has beenaccounted for on an ongoing basis (agood portion has been captured inFY11) and is reflected in the overallmargin. SOH declared a special

interim DPS of 13 Scts or 130%payout on an annualised basis.

Subsea to underpin ordersSOH secured orders for eight vessels worth NOK5bn in 2Q, bringing 1Horders to NOK7.3bn, its highest 1Horder intake in five years. Order bookstands at NOK18.2bn, bringing thegroup back to a comfortable level interms of order book length (18months’ visibility). We expectNOK10bn of orders for FY12 withsubsea driving orders. Upside couldcome from Brazil, especially as the

new yard can now take orders earlier.

Stay invested for 14% yield With anticipated net cash (ex.construction financing) of NOK3.1bnat end-2012, we believe that SOHcould maintain its dividend payments. We expect final DPS of 10 Scts.

CIMB Analyst

eo Zhi Bin

T (65) 62108669E [email protected]

STX OSV 2QFY12 RESULTS NOTESOH SP / STXO.SI

Current S$1.55 SHORT TERM (3 MTH) LONG TERM

Market Cap Avg Daily Turnover Free Float Target S$2.09

US$1,470m US$6.91m 44.3% Previous Target S$2.09S$1,829m S$8.76m 1,180 m shares Up/downside 34.7%

Conviction

Share price info

Share price perf. (%) 1M 3M 12M

Relative 0.3 -1.9 15

Absolute 2.6 4.4 22.5

Major shareholders % held

STX Norway AS 50.7Och-Ziff Capital ManagementGR

21.0

Leading Inv and Sec Co Ltd 4.9

Results ComparisonFYE Dec (NOK m) 2Q 2Q yoy % qoq % 2QFY12 2QFY11 yoy % Prev.

FY12 FY11 ch g c h g Cum Cum ch g FY12F Comments

Revenue 3,337.0 2,744.0 21.6 18.7 6,148.0 5,936.0 3.6 11,983.3 In line

Operating costs (2,877.0) (2,293.0) 25.5 19.0 (5,295.0) (5,046.0) 4.9 (10,305.6) In line

EBITDA 460.0 451.0 2.0 17.0 853.0 890.0 (4.2) 1,677.7 In line

EBITDA margin (%) 13.8 16.4 13.9 15.0 14.0 In line

Depn & amort. (29.0) (31.0) (6.5) (6.5) (60.0) (61.0) (1.6) (143.8) Below

EBIT 431.0 420.0 2.6 19.1 793.0 829.0 (4.3) 1,533.9 Slightly above

Interest expense (3.0) (3.0) - - (6.0) (6.0) - (20.0) Below

Interest & invt inc 14.0 5.0 180.0 - 28.0 15.0 86.7 35.0 Above

Associates' contrib 1.0 10.0 (90.0) - 2.0 12.0 (83.3) 10.0 Below

Exceptionals 1.0 (13.0) 107.7 200.0 - (6.0) (100.0) - Above

Pretax profit 444.0 419.0 6.0 19.0 817.0 844.0 (3.2) 1,558.9 Above

Tax (166.0) (144.0) 15.3 61.2 (269.0) (257.0) 4.7 (467.7) Above, in line with higher profitability

Tax rate (%) 37.4 34.4 32.9 30.5 30.0 Above

Minority interests 1.0 (3.0) 133.3 200.0 - (5.0) (100.0) (5.0) BelowNet profit 279.0 272.0 2.6 3.7 548.0 582.0 (5.8) 1,086.2 In line

EPS (NOK) 0.2 0.3 (13.1) 3.7 0.5 0.5 (5.8) 0.9 In line

Core profit 278.3 280.7 (0.9) 3.2 548.0 586.3 (6.5) 1,086.2 2Q forms 26% of full-yr; 1H at 50%

Core EPS (NOK) 0.2 0.3 (16.0) 3.2 0.5 0.5 (6.5) 0.9 In l ine

SOURCE: CIMB, COMPANY REPORTS

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STX OSV August 14, 2012

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Delays in Brazil but under control

The group still enjoys stable operations at its yards in Norway, Romania and Vietnam. However, its existing Niteroi yard in Brazil is experiencing delays dueto supplier constraints in an overheated market. Furthermore, the groupexperienced labour disputes/strikes in 2Q, which contributed to the delay, butthese are considered force majeure under the contracts. Two vessels are morethan six months behind schedule although they would be delivered in 3Q12. Thefinancial impact of these delays has been accounted for on an ongoing basis (agood portion has been captured in FY11) and is reflected in the overall EBITDAmargin of 13.8%, which is in line with our expectation of 14%.

Construction of new Brazil yard on scheduleConstruction of the new Brazil yard (STX OSV Promar) is 40% completed. Thetotal projected investment has been adjusted from US$126m to US$148m due

to the increased cost of civil works, adjustments to capacity and equipmentspecifications. Shipbuilding activities are scheduled for 2Q13, in line withprevious guidance. The Transpetro project is progressing with steel hulls for thefirst two LPG carriers sub-contracted to third-party Rio Nave yard to easeoperational pressure. Although costs would undoubtedly increase, managementguides that there would not be material impact on the budgeted margins. On theupside, STX OSV Promar could be opened early for construction of OSVs. It has been more than two years since SOH’s Brazil operations took in orders as it isfilled to the brim.

Orders could slow a little after blistering 1HThe group expects a strong subsea market to underpin the order pipeline,although the OSV market remains a mixed picture. The group guides that AHTS

orders are behind expectations due to lower-than-anticipated day rates in thepeak North Sea summer season. In turn, that would have some impact onnear-term orders as operators adopt a cautious approach. Furthermore, thefinancing environment is still tough. Nonetheless, the group guides that thereare projects under negotiation in several vessel segments. It is in this vein that we are keeping our FY12 order target of NOK10bn.

Balancing between growth and distribution of profits While the bumper DPS is a welcome reward for investors, it is also somewhataggressive, in our view. Hence, questions arise about whether there could beconflict between growth and distribution of profits on a longer-term perspective.Management views that growth will not be sacrificed for the sake of aggressivecapital deployment and points towards the strong financial position the group isin. SOH generated strong operating cash flow of NOK1bn in 1H, bringing its netcash position to NOK2.9bn (ex. construction financing). This is on top ofdividends of NOK550m paid out (for 2011). The group maintains its dividendpolicy of 30% payout on the basis of a historical 8-10% EBITDA margin. It couldincrease payouts with better margins, balancing that with the financial positionthe group is in and the available investment opportunities.

Financial Summary

Dec-10A Dec-11A Dec-12F Dec-13F Dec-14F

Revenue (KRm) 11,881 12,401 11,983 12,108 12,742

Operating EBITDA (KRm) 1,329 2,355 1,678 1,574 1,529

Net Profit (KRm) 1,030 1,594 1,086 1,008 971Core EPS (KR) 0.75 1.37 0.92 0.85 0.82

Core EPS Growth 134% 83% (33%) (7%) (4%)

FD Core P/E (x) 9.46 5.17 8.01 8.64 8.97

DPS (KR) 0.14 0.69 1.04 0.32 0.32

Dividend Yield 1.8% 9.4% 14.0% 4.3% 4.3%

EV/EBITDA (x) 7.25 3.42 5.53 5.76 5.57

P/FCFE (x) 11.12 9.24 5.48 6.98 8.52

Net Gearing 76.8% (12.0%) 23.7% 16.1% 1.2%

P/BV (x) 3.66 2.48 2.58 2.36 2.03

Recurring ROE 48.1% 55.0% 31.6% 28.5% 24.3%

% Change In Core EPS Estimates 0% 0% 0%

CIMB/consensus EPS (x) 0.97 0.98 0.96

0.7

0.9

1.1

1.3

1.5

1.7

1.9

64

76

87

99

111

122

134Price Close Relative to FSSTI (RHS)

Source: Bloomberg

20

40

60

80

Aug-11 Nov-11 Feb-12 May-12

V o l m

1.55

2.09

0.83 1.79

Target

52-week share price range

Current

SOURCE: CIMB, COMPANY REPORTS

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With anticipated net cash (ex. construction financing) of NOK3.1bn at end-2012, we believe that SOH could maintain its dividend payments. We expect final DPSof 10 Scts, bringing FY12 dividend yield to 14%.

Figure 1: EBITDA margins: owing to its project recognition schedule, margins for

FY12 will be less volatile compared to FY11

10.8%

6.8%

11.4%

13.8%

16.4%17.6%

14.0% 13.8% 14.0%

12.0%13.0%

18.6%

28.2%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 FY12F FY13F FY14F

FY10: 11.2%

FY11: 19.0%

SOURCES: CIMB, COMPANY REPORTS

Figure 2: SOH secured NOK7.3bn orders in 1H. There is scope for increase in ourorder win assumptions, especially if the group clinches orders for its Brazilian yardsin 2H

17.0 16.714.9 14.5

13.2

15.5

5.74.5

10.0 11.0 11.0

16.4

22.4

27.4

11.1

12.6

-

5.0

10.0

15.0

20.0

25.0

30.0

2007 2008 2009 2010 2011 2012F 2013F 2014F

Order book Order wins

(NOK bn)


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Figure 3: 1H order intake

Date Customer Unit Contract

Est. Value

(NOK m) Delivery

19 Mar 2012 Island Offshore 1 Subsea support vessel 500 1Q1419 Mar 2012 DOF 1 Offshore subsea construction vessel 650 2Q13

30 Mar 2012 Farstad 1 Ultra-large AHTS 600 1Q14

30 Mar 2012 Farstad 1 Ultra-large AHTS 600 1Q14

12 Apr 2012 Iceman AS 1 Ultra-large AHTS 750 2Q13

13 Apr 2012 Siem Offshore 1 Offshore subsea construction vessel 600 3Q13

13 Apr 2012 Siem Offshore 1 Offshore subsea construction vessel 600 3Q14

14 Jun 2012 Ocean Installer/Solstad Offshore 1 Offshore subsea construction vessel 1,400 2Q14

19 Jun 2012 Farstad 1 PSV 350 2Q14

19 Jun 2012 Farstad 1 PSV 350 3Q14

29 Jun 2012 Island Offshore 1 PSV 250 4Q13

29 Jun 2012 Island Offshore 1 PSV 250 2Q14

Variation orders 428

1H order intake 7,328

1Q12

2Q12


Figure 4: Order book by region Figure 5: Order book by vessel type

Order book Deliveries Order

intake

Order book

31 Mar 2012 2Q12 2Q12 30 Jun 2012

Norway/Romania 35 6 7 36

Brazil 15 0 0 15

Vietnam 3 0 1 4

Total 53 6 8 55

Order book Deliveries Order

intake

Order book

31 Mar 2012 2Q12 2Q12 30 Jun 2012

AHTS 8 0 1 9

PSV 26 4 4 26

OSCV 3 1 3 5

Other 16 1 0 15

Total 53 6 8 55 SOURCES: CIMB, COMPANY REPORTS SOURCES: CIMB, COMPANY REPORTS

Figure 6: Delivery schedule: SOH delivered four PSVs, one OSCV and one otherspecialised vessel in 2Q. It has 14 vessels due for delivery in 2H

10.8%

6.8%

11.4%

13.8%

16.4%17.6%

14.0% 13.8% 14.0%

12.0%

28.2%

18.6%

13.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 F Y12F F Y13F F Y14F

FY10: 11.2%

FY11: 19.0%


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Figure 7: Yards' operating performance in 2Q12

Yard Comments

Norway and Romania ▪ Successful delivery of six vessels during 2Q

▪ Recent new orders secure good utilisation of yards in Romania and Norway

Brazil (Niteroi yard) ▪ Several vessels behind schedule▪ Two vessels with more than six months delay currently undergoing sea trials, and

coming to delivery within 3Q12; both have contracts with end user

▪ One vessel scheduled for delivery in 4Q12; one with lesser delay moved from 4Q12

to 1Q13

▪ Remaining vessels in Brazil order book facing lesser delays

▪ Delays mostly due to general yard overload

▪ Financial impact has been accounted for

Brazil (Promar, new yard) ▪ Construction of yard around 40% complete

▪ Start of shipbuilding activities scheduled for 2Q13, in line with previous estimates

▪ Total projected investment increased to US$148m from US$126m

▪ Transpetro project progressing with steel hulls for the first two LPG carriers sub-

contracted to third-party Rio Nave shipyard

Vietnam ▪ Workload for Vietnam yard secured in the short term SOURCES: CIMB, COMPANY REPORTS

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Figure 8: Peer comparisons

Bloomberg Price

Target

Price

Market

Cap Core P/E (x) 2-year EPS P/BV (x)

Recurring

ROE (%)

Dividend

Yield (%)

Company Ticker Recom. (lcl curr) (lcl curr) (US$ m) CY2012 CY2013 CAGR (%) CY2012 CY2012 CY2012

Keppel Corporation KEP SP Outperform 11.48 14.80 16,555 10.5 12.4 5.7% 2.42 24.0% 4.3%

Sembcorp Marine SMM SP Outperform 5.11 5.85 8,570 16.8 15.7 -4.7% 4.01 24.4% 4.6%

Singapore offshore - big cap weighted average 12.1 13.4 2.5% 2.80 24.1% 4.4%

Cosco Corporation COS SP Underperform 0.99 0.85 1,781 18.9 18.9 -8.0% 1.62 8.6% 2.4%

Yangzijiang Shipbuilding YZJ SP Neutral 0.98 1.02 3,017 5.0 5.7 -7.5% 1.21 27.0% 5.0%

Chinese Shipbuilder weighted average 6.8 7.7 -7.6% 1.34 21.1% 4.1%

Sembcorp Industries SCI SP Outperform 5.66 6.48 8,127 13.1 12.3 1.2% 2.20 17.3% 3.0%

ST Engineering STE SP Outperform 3.29 3.49 8,121 17.7 17.4 4.1% 5.41 31.0% 5.1%

SIA Engineering SIE SP Outperform 4.11 4.56 3,637 15.9 14.9 6.8% 3.48 22.1% 5.3%

Industrial conglomerate weighted average 15.2 14.5 3.1% 3.17 21.4% 4.3%

ASL Marine ASL SP Outperform 0.58 0.80 195 7.9 6.5 21.2% 0.65 8.5% 4.4%

Jaya Holdings Ltd JAYA SP NR 0.54 na 331 6.7 5.1 18.9% 0.65 9.8% na

Nam Cheong Ltd NCL SP NR 0.18 na 278 5.8 5.0 35.9% 1.79 25.4% 1.1%

Otto Marine OTML SP Underperform 0.09 0.08 196 na na na 0.57 -5.0% 0.0%STX OSV SOH SP Outperform 1.55 2.09 1,470 8.0 8.6 -23.3% 2.58 31.3% 14.0%

Singapore-listed OSV builder (weighted avg - excl NR) 9.6 9.3 -11.7% 1.54 16.0% 11.5%

Singapore-listed OSV builder (all simple average) 7.1 6.3 13.2% 1.25 14.0% 4.9%

CH Offshore Ltd CHO SP NR 0.43 na 244 7.3 8.1 -4.7% 0.96 11.9% 6.4%

Ezion Holdings EZI SP Outperform 1.03 1.19 701 9.7 5.2 54.2% 1.62 18.9% 0.1%

Ezra Holdings EZRA SP Outperform 1.00 1.38 786 15.0 8.8 40.5% 0.85 5.6% 2.4%

Kreuz Holdings Ltd KRZ SP NR 0.30 na 134 4.3 4.1 4.2% 0.88 22.1% na

Mermaid Maritime MMT SP Outperform 0.26 0.44 164 26.2 9.7 na 0.41 1.6% 0.0%

Swiber Holdings SWIB SP Outperform 0.59 0.79 289 6.1 5.7 18.1% 0.70 11.2% 0.0%

Singapore OSV owner (weighted avg - excl NR) 11.0 6.7 57.6% 0.89 8.2% 1.0%

Singapore OSV owner (all simple average) 11.4 6.9 22.5% 0.90 11.9% 1.8%

Alam Maritim Resources Bhd AMRB MK NR 0.54 na 135 7.4 5.8 139.8% 0.77 9.4% 1.3%

Bumi Armada BAB MK Outperform 3.75 4.87 3,518 21.5 14.3 44.9% 4.80 17.3% 0.7%

Malaysia Marine & Heavy Eng MMHE MK Underperform 4.95 4.75 2,537 20.8 19.4 5.0% 3.35 16.1% 1.5%

Perdana Petroleum PETR MK Outperform 0.63 0.86 99 10.2 8.2 na 0.64 6.6% 0.0%

Perisai Petroleum PPT MK Outperform 0.94 1.53 255 8.5 8.1 65.5% 2.07 26.0% 0.0%SapuraKencana Petroleum SAKP MK Outperform 2.46 2.97 3,943 26.4 15.6 32.2% 2.29 8.8% 0.0%

Malaysia offshore (weighted avg - excl NR) 21.9 15.4 32.5% 2.97 12.9% 0.6%

Malaysia offshore (all simple average) 15.8 11.9 57.5% 2.32 14.0% 0.6%

Wintermar Offshore Marine WINS IJ Outperform 430.0 590.0 161 9.1 7.2 23.3% 1.13 13.3% 0.0%

Indonesia offshore average 9.1 7.2 23.3% 1.13 13.3% 0.0%

Samsung Heavy Industries Co 010140 NR 38,250 na 7,821 10.7 9.9 -0.7% 1.62 16.2% 1.3%

Hyundai Heavy Industries Co Lt 009540 NR 237,000 na 15,952 8.7 7.5 -1.2% 0.96 10.5% 1.8%

Daewoo Shipbuilding & Marine 042660 NR 26,500 na 4,492 10.8 8.7 -6.9% 1.02 9.6% 1.8%

Korean Shipbuilder (all simple average) 10.1 8.7 -3.0% 1.20 12.1% 1.7%

Average (All ex NR co) 12.9 12.7 5.1% 2.48 19.6% 3.8%

Average (All simple) 12.2 10.0 18.6% 1.81 15.3% 2.6% SOURCES: CIMB, COMPANY REPORTS, BLOOMBERG

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This publication is strictly confidential and is for private circulation only to clients of CIMB. This publication is being supplied to you strictly on the basis that it will remain confidential. No part

of this material may be (i) copied, photocopied, duplicated, stored or reproduced in any form by any means or (ii) redistributed or passed on, directly or indirectly, to any other person inwhole or in part, for any purpose without the prior written consent of CIMB.

New Zealand: In New Zealand, this report is for distribution only to persons whose principal business is the investment of money or who, in the course of, and for the purposes of theirbusiness, habitually invest money pursuant to Section 3(2)(a)(ii) of the Securities Act 1978.

Singapore: This report is issued and distributed by CIMB Research Pte Ltd (“CIMBR”). Recipients of this report are to contact CIMBR in Singapor e in respect of any matters arising from,or in connection with, this report. The views and opinions in this research report are ou r own as of the date hereof and are subject to change. If the Financial Services and Markets Act ofhe United Kingdom or the rules of the Financial Services Authority apply to a recipient, our obligations owed to such recipient therein are unaffected. CIMBR has no obligation to update

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its opinion or the information in this research report.

This publication is strictly confidential and is for private circulation only. If the recipient of this research report is not an accredited investor, expert investor or institutional investor, CIMBRaccepts legal responsibility for the contents of the report without any disclaimer limiting or otherwise curtailing such legal responsibility. This publication is being supplied to you strictly onhe basis that it will remain confidential. No part of this material may be (i) copied, photocopied, duplicated, stored or reproduced in any form by any means or (ii) redistributed or passedon, directly or indirectly, to any other person in whole or in part, for any purpose without the prior written consent of CIMBR.

As of August 13, 2012, CIMBR does not have a proprietary position in the recommended securities in this report.

Sweden: This report contains only marketing information and has not been approved by the Swedish Financial Supervisory Authority. The distribution of this report is not an offer to sello any person in Sweden or a solicitation to any person in Sweden to buy any instruments described herein and may not be forwarded to the public in Sweden.

Taiwan: This research report is not an offer or marketing of foreign securities in Taiwan. The securities as referred to in this research report have not been and will not be registered withhe Financial Supervisory Commission of the Republic of China pursuant to relevant securities laws and regulations and may not be offered or sold within the Republic of China through apublic offering or in circumstances which constitutes an offer within the meaning of the Securities and Exchange Law of the Republic of China that requires a registration or approval of theFinancial Supervisory Commission of the Republic of China.

Thailand: This report is issued and distributed by CIMB Securities (Thailand) Company Limited (CIMBS). The views and opinions in this research report are our own as of the date hereofand are subject to change. If the F inancial Services and Markets Act of the United Kingdom or the rules of the Financial Services Authority apply to a recipient, our obligations owed to suchrecipient therein are unaffected. CIMBS has no obligation to update its opinion or the information in this research report.

This publication is strictly confidential and is for private circulation only to clients of CIMBS. This publication is being supplied to you strictly on the basis that it will remain confidential. Nopart of this material may be (i) copied, photocopied, duplicated, stored or reproduced in any form by any means or (ii) redistributed or passed on, directly or indirectly, to any other personin whole or in part, for any purpose without the prior written consent of CIMBS.

Corporate Governance Report:

The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the Office of the Securities andExchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand and the Market for Alternative Investment disclosed

to the public and able to be accessed by a general public investor. The result, therefore, is from the perspective of a third party. It is not an evaluation of operation and is not based oninside 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 date. CIMBS doesnot confirm nor certify the accuracy of such survey result.

Score Range 90 – 100 80 – 89 70 – 79 Below 70 or No Survey Result

Description Excellent Very Good Good N/A

United Arab Emirates: The distributor of this report has not been approved or licensed by the UAE Central Bank or any other relevant licensing authorities or governmental agencies inhe United Arab Emirates. This report is strictly private and confidential and has not been reviewed by, deposited or registered with UAE Central Bank or any other licensing authority orgovernmental agencies in the United Arab Emirates. This report is being issued outside the United Arab Emirates to a limited number of institutional investors and must not be provided toany person other than the original recipient and may not be reproduced or used for any other purpose. Further, the information contained in this report is not intended to lead to the saleof investments under any subscription agreement or the conclusion of any other contract of whatsoever nature within the territory of the United Arab Emirates.

United Kingdom: This report is being distributed by CIMB Securities (UK) Limi ted only to, and is directed at selected persons on the basis that those persons are (a) persons falling within Article 19 of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (the “Order”) who have professional experience in investments of this type or (b) high networth entities, and other persons to whom it may otherwise lawfully be communicated, falling within Article 49(1) of the Order, (all such persons together being referred to as “relevantpersons”). A high net worth entity includes a body corporate which has (or is a member of a group wh ich has) a called-up share capital or net assets of not less than (a) if it has (or is asubsidiary of an undertaking which has) more than 20 members, £500,000, (b) otherwise, £5 million, the trustee of a high value trust or an unincorporated association or partnership with

assets of no less than £5 million. Directors, officers and employees of such entities are also included provided their responsibilities regarding those entities involve engaging in investmentactivity. Persons who do not have professional experience relating to investments should not rely on this document.

United States: This research report is distributed in the United States of America by CIMB Securities (USA) Inc, a U.S. -registered broker-dealer and a related company of CIMB ResearchPte Ltd solely to persons who qualify as "Major U.S. Institutional Investors" as defined in Rule 15a-6 under the Securities and Exchange Act of 1934. This communication is only forInstitutional Investors and investment professionals whose ordinary business activities involve investing in shares, bonds and associated securities and/or derivative securities and whohave professional experience in such investments. Any person who is not an Institutional Investor must not rely on this communication. However, the delivery of this research report to anyperson in the United States of America shall not be deemed a recommendation to effect any transactions in the securities discussed herein or an endorsement of any opinion expressedherein. For further information or to place an order in any of the above-mentioned securities please contact a registered representative of CIMB Securities (USA) Inc.

Other jurisdictions: In any other jurisdictions, except if otherwise restricted by laws or regulations, this report is on ly for distribtion to professional, institutional or sophisticated investorsas defined in the laws and regulations of such jurisdictions.

Recommendation Framework #1 *

Stock Sector

OUTPERFORM: The stock's total return is expected to exceed a relevantbenchmark's total return by 5% or more over the next 12 months.

OVERWEIGHT: The industry, as defined by the analyst's coverage universe, isexpected to outperform the relevant primary market index over the next 12 months.

NEUTRAL: The stock's total return is expected to be within +/-5% of a relevantbenchmark's total return.

NEUTRAL: The industry, as defined by the analyst's coverage universe, is expectedto perform in line with the relevant primary market index over the next 12 months.

UNDERPERFORM: The stock's total return is expected to be below a relevantbenchmark's total return by 5% or more over the next 12 months.

UNDERWEIGHT: The industry, as defined by the analyst's coverage universe, isexpected to underperform the relevant primary market index over the next 12 months.

TRADING BUY: The stock's total return is expected to exceed a relevantbenchmark's total return by 5% or more over the next 3 months.

TRADING BUY: The industry, as defined by the analyst's coverage universe, isexpected to outperform the relevant primary market index over the next 3 months.

TRADING SELL: The stock's total return is expected to be below a relevantbenchmark's total return by 5% or more over the next 3 months.

TRADING SELL: The industry, as defined by the analyst's coverage universe, isexpected to underperform the relevant primary market index over the next 3 months.

* This framework only applies to stocks listed on the Singapore Stock Exchange, Bursa Malaysia, Stock Exchange of Thailand and Jakarta Stock Exchange. Occasionally, it is permitted for the total expected

returns to be temporarily outside the prescribed ranges due to extreme market volatility or other justifiable company or industry-specific reasons.

CIMB Research Pte Ltd (Co. Reg. No. 198701620M)

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Recommendation Framework #2 **

Stock Sector

OUTPERFORM: Expected positive total returns of 10% or more over the next 12months.

OVERWEIGHT: The industry, as defined by the analyst's coverage universe, has ahigh number of stocks that are expected to have total returns of +10% or better overthe next 12 months.

NEUTRAL: Expected total returns of between -10% and +10% over the next 12months.

NEUTRAL: The industry, as defined by the analyst's coverage universe, has either (i)an equal number of stocks that are expected to have total returns of +10% (or better)or -10% (or worse), or (ii) stocks that are predominantly expected to have total returnsthat will range from +10% to -10%; both over the next 12 months.

UNDERPERFORM: Expected negative total returns of 10% or more over the next 12months.

UNDERWEIGHT: The industry, as defined by the analyst's coverage universe, has ahigh number of stocks that are expected to have total returns of -10% or worse overthe next 12 months.

TRADING BUY: Expected positive total returns of 10% or more over the next 3months.

TRADING BUY: The industry, as defined by the analyst's coverage universe, has ahigh number of stocks that are expected to have total returns of +1 0% or better overthe next 3 months.

TRADING SELL: Expected negative total returns of 10% or more over the next 3months.

TRADING SELL: The industry, as defined by the analyst's coverage universe, has ahigh number of stocks that are expected to have total returns of -10% or worse overthe next 3 months.

** This framework only applies to stocks listed on the Hong Kong Stock Exchange and China listings on the Singapore Stock Exchange. Occasionally, it is permitted for the total expected returns to be temporarily

outside the prescribed ranges due to extreme market volatility or other justifiable company or industry-specific reasons.

Corporate Governance Report of Thai Listed Companies (CGR). CG Rating by the Thai Institute of Directors Association (IOD) in 2011.

ADVANC - Excellent, AMATA - Very Good, AOT - Excellent, AP - Very Good, BANPU - Excellent , BAY - Excellent , BBL - Excellent, BCP - Excellent, BEC - Very Good, BECL -Very Good, BGH - not available, BH - Very Good, BIGC - Very Good, BTS - Very Good, CCET - Good, CK - Very Good, CPALL - Very Good, CPF - Very Good, CPN - Excellent,DELTA - Very Good, DTAC - Very Good, GLOBAL - not available, GLOW - Very Good, GRAMMY – Excellent, HANA - Very Good, HEMRAJ - Excellent, HMPRO - Very Good,INTUCH – Very Good, ITD - Good, IVL - Very Good, JAS – Very Good, KBANK - Excellent, KTB - Excellent, LH - Very Good, LPN - Excellent, MAJOR - Very Good, MCOT -Excellent, MINT - Very Good, PS - Excellent, PSL - Excellent, PTT - Excellent, PTTGC - not available, PTTEP - Excellent, QH - Excellent, RATCH - Excellent, ROBINS - Excellent,SC – Excellent, SCB - Excellent, SCC - Excellent, SCCC - Very Good, SIRI - Very Good, SPALI - Very Good, STA - Very Good, STEC - Very Good, TCAP - Very Good, THAI - VeryGood, THCOM – Very Good, TISCO - Excellent, TMB - Excellent, TOP - Excellent, TRUE - Very Good, TUF - Very Good.

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