Date - 6th June, 2012Date - 6th June, 2012Date - 6 June, 2012

Essar Oil Ltd.Essar Oil Ltd.Essar Oil Ltd.Essar Oil Ltd.Essar Oil Ltd.CMP - INR 52.00 TP - INR 78.00CMP - INR 52.00 TP - INR 78.00CMP - INR 52.00 TP - INR 78.00

TH - 15 to 18 Months Up Side - 52.94 %TH - 15 to 18 Months Up Side - 52.94 %

We initiate investment note on Essar oil Ltd. as a BUY withWe initiate investment note on Essar oil Ltd. as a BUY withWe initiate investment note on Essar oil Ltd. as a BUY with

(target 6.87x FY13 P/E). At CMP of 52.00 the stock is trading(target 6.87x FY13 P/E). At CMP of 52.00 the stock is trading(target 6.87x FY13 P/E). At CMP of 52.00 the stock is trading

estimated earnings for FY13E & FY14E representing a potentialestimated earnings for FY13E & FY14E representing a potentialestimated earnings for FY13E & FY14E representing a potential

over a period of 15 to 18 months. Key drivers of this growthover a period of 15 to 18 months. Key drivers of this growth

refinery capacity and improvement in complexity structure,refinery capacity and improvement in complexity structure,refinery capacity and improvement in complexity structure,

thought put cost and Yield to shift towards high grade productsthought put cost and Yield to shift towards high grade productsthought put cost and Yield to shift towards high grade products

�Investment Rationales�Investment Rationales�Investment Rationales

Doubled the capacity and complexity of refineryDoubled the capacity and complexity of refineryDoubled the capacity and complexity of refinery

Essar oil almost doubled their capacity and complexity of fromEssar oil almost doubled their capacity and complexity of fromEssar oil almost doubled their capacity and complexity of from

mmtpa and 6.1 to 11.8 respectively in less than 4 years with projectmmtpa and 6.1 to 11.8 respectively in less than 4 years with project

Due to this expansion project Vadinar Refinery becomes secondDue to this expansion project Vadinar Refinery becomes secondDue to this expansion project Vadinar Refinery becomes second

refinery in India and one of most complexes in global marketrefinery in India and one of most complexes in global marketrefinery in India and one of most complexes in global market

optimization project, to increase the capacity to 20 mmtpa, onoptimization project, to increase the capacity to 20 mmtpa, onoptimization project, to increase the capacity to 20 mmtpa, on

by Sept, 12by Sept, 12by Sept, 12

Improvement in complexity reduces the throughput costImprovement in complexity reduces the throughput costImprovement in complexity reduces the throughput cost

Vadinar Expansion Project to enable the refinery to process aroundVadinar Expansion Project to enable the refinery to process aroundVadinar Expansion Project to enable the refinery to process around

ultra heavy crude thus reduce the overall cost of crude basketultra heavy crude thus reduce the overall cost of crude basketultra heavy crude thus reduce the overall cost of crude basket

produce higher grades (Euro-IV&V) products to cater the demandproduce higher grades (Euro-IV&V) products to cater the demand

international markets.international markets.international markets.

Yield to shift towards high grade productsYield to shift towards high grade productsYield to shift towards high grade products

In terms of product yield, the Vadinar Refinery now has theIn terms of product yield, the Vadinar Refinery now has theIn terms of product yield, the Vadinar Refinery now has the

higher value, high-quality products, including gasoline (petrol)higher value, high-quality products, including gasoline (petrol)higher value, high-quality products, including gasoline (petrol)

conforming to Euro IV and Euro V norms, that have growingconforming to Euro IV and Euro V norms, that have growingconforming to Euro IV and Euro V norms, that have growing

domestic and international markets. Close to 80% of its productiondomestic and international markets. Close to 80% of its productiondomestic and international markets. Close to 80% of its production

valuable light and middle distillates, and 50% of the productionvaluable light and middle distillates, and 50% of the production

gasoline (petrol) will meet Euro IV and Euro V specifications.gasoline (petrol) will meet Euro IV and Euro V specifications.gasoline (petrol) will meet Euro IV and Euro V specifications.

markets such as Australia, New Zealand and north-west Europemarkets such as Australia, New Zealand and north-west Europemarkets such as Australia, New Zealand and north-west Europe

a Price target of 78.00a Price target of 78.00a Price target of 78.00

trading at 4.58x and 1.89x its Market Datatrading at 4.58x and 1.89x its Market Data

Sctor Integrated Oil & Gastrading at 4.58x and 1.89x its

potential upside of 52.94%Sctor Integrated Oil & Gas

potential upside of 52.94%Sctor Integrated Oil & Gas

Sensex 16454.30potential upside of 52.94%

growth are a expansion inSensex 16454.30

Equity Shares (Cr) 138.23growth are a expansion in

structure, drastic reduction inEquity Shares (Cr) 138.23

structure, drastic reduction inEquity Shares (Cr) 138.23

Face Value (INR) 10structure, drastic reduction in

products.Face Value (INR) 10

52-wk HI/LO (INR) 99/45 products. 52-wk HI/LO (INR) 99/45 products. 52-wk HI/LO (INR) 99/45

O/S shares (Cr) 138.23O/S shares (Cr) 138.23O/S shares (Cr) 138.23

Market Cap (Cr) 7187.80Market Cap (Cr) 7187.80

Beta 1.46Beta 1.46Beta 1.46

from 10.5 mmtpa to 18 Y/E Mar Cr FY10A FY11A FY12E FY13Efrom 10.5 mmtpa to 18 Y/E Mar Cr FY10A FY11A FY12E FY13Efrom 10.5 mmtpa to 18

project cost of Rs 8300 cr.Y/E Mar Cr FY10A FY11A FY12E FY13E

Net Sales 37318 47905 54111 68777project cost of Rs 8300 cr.

second largest single location

Net Sales 37318 47905 54111 68777

OP 1066 2425 2352 4442second largest single location OP 1066 2425 2352 4442second largest single location

market. On the other hand

OP 1066 2425 2352 4442

Net Profit 29 654 500 1569market. On the other hand Net Profit 29 654 500 1569market. On the other hand

on schedule to complete

Net Profit 29 654 500 1569

GRM $ 5.56 6.87 6.97 8.67on schedule to complete

GRM $ 5.56 6.87 6.97 8.67

EPS 0.24 4.73 3.61 11.35on schedule to complete

EPS 0.24 4.73 3.61 11.35EPS 0.24 4.73 3.61 11.35

CEPS 6.22 10.02 9.61 19.98CEPS 6.22 10.02 9.61 19.98

P/E 572.1 26.3 14.4 4.6P/E 572.1 26.3 14.4 4.6

around 80% of heavy andP/E 572.1 26.3 14.4 4.6

P/BV 3.61 2.63 1.02 0.84around 80% of heavy and P/BV 3.61 2.63 1.02 0.84around 80% of heavy and

basket and make capable to

P/BV 3.61 2.63 1.02 0.84

EV/EBITDA(x) 13.34 10.36 7.22 4.28basket and make capable to EV/EBITDA(x) 13.34 10.36 7.22 4.28

M Cap / Sales 0.45 0.35 0.13 0.10basket and make capable to

demand of domestic & M Cap / Sales 0.45 0.35 0.13 0.10demand of domestic & M Cap / Sales 0.45 0.35 0.13 0.10

EV/CE(x) 1.26 1.11 0.69 0.62EV/CE(x) 1.26 1.11 0.69 0.62

Holding FY12Q4 No Of Shares (%)

the flexibility to produceHolding FY12Q4 No Of Shares (%)

Promoter Group (A) 218020941 61.39the flexibility to produce Promoter Group (A) 218020941 61.39the flexibility to produce

(petrol) and gas oil (diesel)

Promoter Group (A) 218020941 61.39

(1) Institutions 48334264 13.61(petrol) and gas oil (diesel) (1) Institutions 48334264 13.61(petrol) and gas oil (diesel)

growing acceptance in both

(1) Institutions 48334264 13.61

(2) Non-Institutions 88789109 25.00growing acceptance in both (2) Non-Institutions 88789109 25.00

Total 1365667086 100.00growing acceptance in both

production will now be ofTotal 1365667086 100.00

production will now be ofTotal 1365667086 100.00

production will now be of

production of gas oil (diesel) and Analyst Detailsproduction of gas oil (diesel) and

EOL is targeting newerAnalyst Details

EOL is targeting newerAnalyst Details

Pushkaraj JamsandekarEOL is targeting newer

Europe.Pushkaraj Jamsandekar

Contact - +09869139507 Europe. Contact - +09869139507 Europe. Contact - +09869139507

Mail ID - pushkarajjamsandekar@yahoo.com Mail ID - pushkarajjamsandekar@yahoo.com Mail ID - pushkarajjamsandekar@yahoo.com

Perception Research & AdvisoryPerception Research & Advisory

Crude Mix & Sourcing StrategyCrude Mix & Sourcing StrategyCrude Mix & Sourcing Strategy

The capacity expansion and complexity enhancement gives theThe capacity expansion and complexity enhancement gives the

capability to process much heavier crude diet. The share of ultracapability to process much heavier crude diet. The share of ultracapability to process much heavier crude diet. The share of ultra

currently constitute 20% of crude basket, will go up to 60%; andcurrently constitute 20% of crude basket, will go up to 60%; andcurrently constitute 20% of crude basket, will go up to 60%; and

share of heavy and ultra heavy crude will go up to 80% of theshare of heavy and ultra heavy crude will go up to 80% of theshare of heavy and ultra heavy crude will go up to 80% of the

basket. The company has already entered into long-term crudebasket. The company has already entered into long-term crudebasket. The company has already entered into long-term crude

global suppliers, including several national oil companies from Latinglobal suppliers, including several national oil companies from Latinglobal suppliers, including several national oil companies from Latin

ValuationValuationValuation

We expect that the improvement in complexity reduce theWe expect that the improvement in complexity reduce the

shoot-up the GRM and EBITDA by 26% and 73% respectively over

We expect that the improvement in complexity reduce the

shoot-up the GRM and EBITDA by 26% and 73% respectively overshoot-up the GRM and EBITDA by 26% and 73% respectively over

to FY13E. Presently stock is traded at 5x to FY13 EPS. On theto FY13E. Presently stock is traded at 5x to FY13 EPS. On theto FY13E. Presently stock is traded at 5x to FY13 EPS. On the

model we expect that the top and bottom line numbers will growmodel we expect that the top and bottom line numbers will growmodel we expect that the top and bottom line numbers will grow

respectively on yoy bases (FY12 to FY13) . We recommend to BUYrespectively on yoy bases (FY12 to FY13) . We recommend to BUYrespectively on yoy bases (FY12 to FY13) . We recommend to BUY

52rs with the target price of 78rs for the time horizon of 12 to52rs with the target price of 78rs for the time horizon of 12 to52rs with the target price of 78rs for the time horizon of 12 to

the Vadinar Refinery thethe Vadinar Refinery the

ultra heavy crude, whichultra heavy crude, whichultra heavy crude, which

and as a result the overalland as a result the overalland as a result the overall

the refinery's total crudethe refinery's total crudethe refinery's total crude

crude sourcing contract withcrude sourcing contract withcrude sourcing contract with

Latin AmericaLatin AmericaLatin America

through put cost andthrough put cost and

over the period of FY11

through put cost and

over the period of FY11over the period of FY11

the basis of our financialthe basis of our financialthe basis of our financial

grow at 44% and 140%grow at 44% and 140%grow at 44% and 140%

BUY Essar oil at CMR ofBUY Essar oil at CMR ofBUY Essar oil at CMR of

15 months.15 months.15 months.

Financials And Projections Financials And Projections Financials And Projections

P&L Account FY10A FY11A FY12E FY13E Cash FlowP&L Account FY10A FY11A FY12E FY13E Cash Flow

Net Sales 37318 47905 54111 68777 Profit Before TaxNet Sales 37318 47905 54111 68777 Profit Before TaxNet Sales 37318 47905 54111 68777 Profit Before Tax

Growth - 28.4% 13.0% 27.1% AdjustmentGrowth - 28.4% 13.0% 27.1% Adjustment

Raw Material Consumed 34562 44093 50038 61837 Changes In WCRaw Material Consumed 34562 44093 50038 61837 Changes In WCRaw Material Consumed 34562 44093 50038 61837 Changes In WC

Other Refining Expenses 1691 1386 1721 2498 CF after changes in WCOther Refining Expenses 1691 1386 1721 2498 CF after changes in WC

Operating Profit 1066 2425 2352 4442 CF - Operating ActivitiesOperating Profit 1066 2425 2352 4442 CF - Operating ActivitiesOperating Profit 1066 2425 2352 4442 CF - Operating Activities

Other Income 872 354 354 354 CF - Investing ActivitiesOther Income 872 354 354 354 CF - Investing Activities

EBITDA 1938 2779 2706 4796 CF - Financing ActivitiesEBITDA 1938 2779 2706 4796 CF - Financing ActivitiesEBITDA 1938 2779 2706 4796 CF - Financing Activities

EBITDA Margin 4.6% 5.2% 4.6% 6.3% Net Cash In/OutEBITDA Margin 4.6% 5.2% 4.6% 6.3% Net Cash In/Out

Interest 1181 1220 1252 1591 Closing CashInterest 1181 1220 1252 1591 Closing Cash

PBDT 757 1559 1454 3205PBDT 757 1559 1454 3205

PBDT Margin 1.8% 2.9% 2.4% 4.2%PBDT Margin 1.8% 2.9% 2.4% 4.2%

Depreciation 728 731 829 1193 Ratios & AssumptionsDepreciation 728 731 829 1193 Ratios & AssumptionsDepreciation 728 731 829 1193 Ratios & Assumptions

Profit Before Tax 29 828 625 2011 Adjusted EPS (Rs.)Profit Before Tax 29 828 625 2011 Adjusted EPS (Rs.)

PBT Margin 0.1% 1.6% 1.1% 2.7% Adjusted PE (x)PBT Margin 0.1% 1.6% 1.1% 2.7% Adjusted PE (x)PBT Margin 0.1% 1.6% 1.1% 2.7% Adjusted PE (x)

Provision for Tax -1 175 125 442 Gross Refining Margin Provision for Tax -1 175 125 442 Gross Refining Margin

Profit After Tax 29 654 500 1569 PCE(x)Profit After Tax 29 654 500 1569 PCE(x)Profit After Tax 29 654 500 1569 PCE(x)

PAT Margin 0.1% 1.2% 0.8% 2.1% Price / Book Value(x)PAT Margin 0.1% 1.2% 0.8% 2.1% Price / Book Value(x)

EV/Net Sales(x)EV/Net Sales(x)EV/Net Sales(x)

EV/EBITDA(x)EV/EBITDA(x)

Balance Sheet FY10A FY11A FY12E FY13E EV/EBIT(x)Balance Sheet FY10A FY11A FY12E FY13E EV/EBIT(x)

Net Fixed Assets 12309 11744 12588 15636 EV/CE(x)Net Fixed Assets 12309 11744 12588 15636 EV/CE(x)

Capital Work in Progress 4319 8423 8423 8423 M Cap / SalesCapital Work in Progress 4319 8423 8423 8423 M Cap / Sales

Investments 203 103 103 103 ROA (%)Investments 203 103 103 103 ROA (%)Investments 203 103 103 103 ROA (%)

Current assets ROE (%)Current assets ROE (%)

Inventories 3969 5749 6541 8314 ROCE (%)Inventories 3969 5749 6541 8314 ROCE (%)Inventories 3969 5749 6541 8314 ROCE (%)

Sundry Debtors 1957 2367 2769 3520 Asset Turnover(x)Sundry Debtors 1957 2367 2769 3520 Asset Turnover(x)

Cash and Bank 1351 2959 3633 3954 Inventory Turnover(x)Cash and Bank 1351 2959 3633 3954 Inventory Turnover(x)Cash and Bank 1351 2959 3633 3954 Inventory Turnover(x)

Other Current Assets 721 574 595 756 CEPS (Rs)Other Current Assets 721 574 595 756 CEPS (Rs)

Loans and Advances 414 662 785 998 Core AssumptionsLoans and Advances 414 662 785 998 Core AssumptionsLoans and Advances 414 662 785 998 Core Assumptions

Total Current Assets 8413 12311 14323 17541 Capacity bbl/dTotal Current Assets 8413 12311 14323 17541 Capacity bbl/d

Current Liabilities Capacity UtilizationCurrent Liabilities Capacity Utilization

Creditors 10161 11288 12218 15530 DollarCreditors 10161 11288 12218 15530 DollarCreditors 10161 11288 12218 15530 Dollar

Other 56 197 214 272 Working DaysOther 56 197 214 272 Working Days

Total Liabilities 10217 11485 12432 15802 Avg Crude BasketTotal Liabilities 10217 11485 12432 15802 Avg Crude BasketTotal Liabilities 10217 11485 12432 15802 Avg Crude Basket

Net Current Assets -1804 826 1891 1739 Product Clash - MMTPANet Current Assets -1804 826 1891 1739 Product Clash - MMTPA

Long Term debt 10354 14547 15967 17295 Light distilleriesLong Term debt 10354 14547 15967 17295 Light distilleriesLong Term debt 10354 14547 15967 17295 Light distilleries

Minorities & Deferred Tax 1 -11 0 0 Meddle distilleriesMinorities & Deferred Tax 1 -11 0 0 Meddle distilleries

Net Worth 4674 6538 7038 8606 Heavy distilleriesNet Worth 4674 6538 7038 8606 Heavy distilleriesNet Worth 4674 6538 7038 8606 Heavy distilleries

Finance Through Throughput - MMTPAFinance Through Throughput - MMTPA

Share Capital 1218 1382 1382 1382 Light CrudeShare Capital 1218 1382 1382 1382 Light CrudeShare Capital 1218 1382 1382 1382 Light Crude

Total Reserves 2302 5156 5655 7224 Heavy CrudeTotal Reserves 2302 5156 5655 7224 Heavy Crude

Net Worth 4674 6538 7038 8606 Ultra Heavy CrudeNet Worth 4674 6538 7038 8606 Ultra Heavy Crude

Source: Perception ResearchSource: Perception ResearchSource: Perception Research

FY10A FY11A FY12E FY13EFY10A FY11A FY12E FY13E

Profit Before Tax 29 828 625 2011Profit Before Tax 29 828 625 2011Profit Before Tax 29 828 625 2011

1379 1477 2081 27851379 1477 2081 2785

-645 -926 -263 788-645 -926 -263 788-645 -926 -263 788

CF after changes in WC 762 1379 2442 5584CF after changes in WC 762 1379 2442 5584

Operating Activities 769 1219 2317 5142Operating Activities 769 1219 2317 5142Operating Activities 769 1219 2317 5142

Investing Activities -2075 -5756 -1673 -4241Investing Activities -2075 -5756 -1673 -4241

Financing Activities 1331 4484 -132 -1253Financing Activities 1331 4484 -132 -1253Financing Activities 1331 4484 -132 -1253

24 -53 512 -35324 -53 512 -353

215 162 674 321215 162 674 321

Ratios & Assumptions FY10A FY11A FY12E FY13ERatios & Assumptions FY10A FY11A FY12E FY13ERatios & Assumptions FY10A FY11A FY12E FY13E

Adjusted EPS (Rs.) 0.24 4.73 3.61 11.35Adjusted EPS (Rs.) 0.24 4.73 3.61 11.35

572.06 26.32 14.39 4.58572.06 26.32 14.39 4.58572.06 26.32 14.39 4.58

Gross Refining Margin - $ 5.56 6.87 6.97 8.67Gross Refining Margin - $ 5.56 6.87 6.97 8.67

22.24 12.43 5.41 2.6022.24 12.43 5.41 2.6022.24 12.43 5.41 2.60

Price / Book Value(x) 3.61 2.63 1.02 0.84Price / Book Value(x) 3.61 2.63 1.02 0.84

0.69 0.60 0.36 0.300.69 0.60 0.36 0.300.69 0.60 0.36 0.30

13.34 10.36 7.22 4.2813.34 10.36 7.22 4.28

21.38 14.06 10.40 5.7021.38 14.06 10.40 5.70

1.26 1.11 0.69 0.621.26 1.11 0.69 0.62

0.45 0.35 0.13 0.100.45 0.35 0.13 0.10

0.16 3.14 2.00 5.160.16 3.14 2.00 5.160.16 3.14 2.00 5.16

0.71 11.66 7.36 20.060.71 11.66 7.36 20.06

6.44 8.04 6.44 10.286.44 8.04 6.44 10.286.44 8.04 6.44 10.28

Asset Turnover(x) 3.12 3.82 4.01 4.25Asset Turnover(x) 3.12 3.82 4.01 4.25

Inventory Turnover(x) 13.63 10.93 9.68 10.18Inventory Turnover(x) 13.63 10.93 9.68 10.18Inventory Turnover(x) 13.63 10.93 9.68 10.18

6.22 10.02 9.61 19.986.22 10.02 9.61 19.98

Core AssumptionsCore AssumptionsCore Assumptions

289342 300530 300000 375000289342 300530 300000 375000

Capacity Utilization 129% 141% 126% 100%Capacity Utilization 129% 141% 126% 100%

47.43 45.55 49.50 49.0047.43 45.55 49.50 49.0047.43 45.55 49.50 49.00

342 360 325 360342 360 325 360

Avg Crude Basket 70.01 85.53 98.57 88.06Avg Crude Basket 70.01 85.53 98.57 88.06Avg Crude Basket 70.01 85.53 98.57 88.06

MMTPAMMTPA

2.96 3.75 3.49 3.942.96 3.75 3.49 3.942.96 3.75 3.49 3.94

Meddle distilleries 6.40 6.37 5.30 8.95Meddle distilleries 6.40 6.37 5.30 8.95

Heavy distilleries 3.32 3.78 3.65 5.47Heavy distilleries 3.32 3.78 3.65 5.47Heavy distilleries 3.32 3.78 3.65 5.47

MMTPAMMTPA

3.62 5.21 3.70 2.763.62 5.21 3.70 2.763.62 5.21 3.70 2.76

6.87 6.53 7.56 4.796.87 6.53 7.56 4.79

Ultra Heavy Crude 3.01 3.03 1.94 10.87Ultra Heavy Crude 3.01 3.03 1.94 10.87

Investment Criteria & DisclaimerInvestment Criteria & DisclaimerInvestment Criteria & Disclaimer

Rating Low Risk Rating Low Risk Rating Low Risk

Buy Over 15 %Buy Over 15 %

Accumulate 10 % to 15 %Accumulate 10 % to 15 %

Hold 0% to 10 %Hold 0% to 10 %Hold 0% to 10 %

Sell Negative Returns Negative ReturnsSell Negative Returns Negative Returns

Risk Description Predictability of Earnings / Dividends / Price VolatilityRisk Description Predictability of Earnings / Dividends / Price VolatilityRisk Description Predictability of Earnings / Dividends / Price Volatility

Low RiskLow Risk

Medium RiskMedium RiskMedium Risk

High RiskHigh Risk

Analyst DetailsAnalyst DetailsAnalyst Details

Pushkaraj JamsandekarPushkaraj Jamsandekar

MMS - FinanceMMS - FinanceMMS - Finance

Contact - +09869139507Contact - +09869139507Contact - +09869139507

Email ID - pushkarajjamsandekar@yahoo.comEmail ID - pushkarajjamsandekar@yahoo.com

Perception Research & AdvisoryPerception Research & AdvisoryPerception Research & Advisory

Disclaimer Disclaimer Disclaimer

This document is for private circulation and information purposes onlyThis document is for private circulation and information purposes onlyThis document is for private circulation and information purposes only

taxation or legal advice. Investors should seek financial advice regarding thetaxation or legal advice. Investors should seek financial advice regarding the

investment strategies discussed or recommended in this publication andinvestment strategies discussed or recommended in this publication andinvestment strategies discussed or recommended in this publication and

future prospects may not be realized. In no circumstances it be used or consideredfuture prospects may not be realized. In no circumstances it be used or considered

offer to buy or sell the securities mentioned in it. We and our affiliates, officers,offer to buy or sell the securities mentioned in it. We and our affiliates, officers,offer to buy or sell the securities mentioned in it. We and our affiliates, officers,

involved in the preparation or issuance of this material may: (a) from time toinvolved in the preparation or issuance of this material may: (a) from time to

sell the securities thereof, of company(ies) mentioned herein or (b) besell the securities thereof, of company(ies) mentioned herein or (b) besell the securities thereof, of company(ies) mentioned herein or (b) be

securities and earn brokerage or other compensation or act as a marketsecurities and earn brokerage or other compensation or act as a marketsecurities and earn brokerage or other compensation or act as a market

company(ies) dis-cussed herein or act as an advisor or lender or borrower tocompany(ies) dis-cussed herein or act as an advisor or lender or borrower to

interest with respect to any recommendation and re-lated informationinterest with respect to any recommendation and re-lated informationinterest with respect to any recommendation and re-lated information

publication may have been taken from trade and statistical services and otherpublication may have been taken from trade and statistical services and other

does not guarantee that such information is accurate or complete and it shoulddoes not guarantee that such information is accurate or complete and it shoulddoes not guarantee that such information is accurate or complete and it should

pressed reflects judgments at this date and are subject to change withoutpressed reflects judgments at this date and are subject to change without

investment can be substantial. You should carefully consider whether tradinginvestment can be substantial. You should carefully consider whether tradinginvestment can be substantial. You should carefully consider whether trading

your experience, objectives, financial resources and other relevant circumstancesyour experience, objectives, financial resources and other relevant circumstances

Source: Perception ResearchSource: Perception Research

Medium Risk High RiskMedium Risk High RiskMedium Risk High Risk

Over 20% Over 25%Over 20% Over 25%

15% to 20% 20% to 25%15% to 20% 20% to 25%

0% to 15% 0% to 20%0% to 15% 0% to 20%0% to 15% 0% to 20%

Negative Returns Negative ReturnsNegative Returns Negative Returns

Predictability of Earnings / Dividends / Price VolatilityPredictability of Earnings / Dividends / Price VolatilityPredictability of Earnings / Dividends / Price Volatility

High predictability / Low volatilityHigh predictability / Low volatility

Moderate predictability / volatilityModerate predictability / volatilityModerate predictability / volatility

Low predictability / High volatilityLow predictability / High volatility

and should not be regarded as an investment,and should not be regarded as an investment,and should not be regarded as an investment,

the appropriateness of investing in any securities orthe appropriateness of investing in any securities or

and should under-stand that statements regardingand should under-stand that statements regardingand should under-stand that statements regarding

considered as an offer to sale or a solicitation of anyconsidered as an offer to sale or a solicitation of any

officers, directors and employees including personsofficers, directors and employees including personsofficers, directors and employees including persons

to time, have long or short positions in, and buy orto time, have long or short positions in, and buy or

engaged in any other transaction involving suchengaged in any other transaction involving suchengaged in any other transaction involving such

market maker in the financial instruments of themarket maker in the financial instruments of themarket maker in the financial instruments of the

to such company or have other potential conflict ofto such company or have other potential conflict of

and opinions. The information contained in thisand opinions. The information contained in thisand opinions. The information contained in this

other sources, which we believe are reliable. Weother sources, which we believe are reliable. We

should not be relied upon as such. Any opinion ex-should not be relied upon as such. Any opinion ex-should not be relied upon as such. Any opinion ex-

without notice. Caution: Risk of loss in trading &without notice. Caution: Risk of loss in trading &

trading & investment is appropriate for you in light oftrading & investment is appropriate for you in light oftrading & investment is appropriate for you in light of

circumstances.circumstances.