Pua Kah Kin Samuel

Disclaimer & Declaration The objective of the presentation is for educational purposes. The full content of the presentation is for illustration purposes only and should not be used as investment recommendations. AB Maximus and its presenters are not responsible for all investment activities conducted by the participants and cannot be held liable for any investment loss. The company and presenters may have personal interest in the particular shares presented.

Content Company Background Valuation Risks Conclusion Q&A

Company Background Listed on 4 October 1996 in SGX

Mainboard Global supplier of fish products One of the largest importers of frozen

seafood in China Performs upstream industrial fishing via

its strategic investment in SGX listed China Fishery Group Limited (58% owned)

Shareholding Structure

Obtained from PARD Investor Relations

Business Segments Fishing Segment

Fishery & Fish Supply Industrial-Scale Fishing Sourcing Onboard Processing of Ocean Fishes

Frozen Fish Supply-Chain Management(SCM) Trading Sourcing & Import of Fishes

Fishmeal Processing Logistical Support to Commercial Fishing Vessels

Products

Obtained from China Fishery Group Investor Relations

Business Segments

$5,347.00 $4,369.00

Sales (HK$ Mil)

Fishing

Supply Chain Management

Obtained from PARD Annual Report

Business Segments

$1,427.00

$393.00

Operating Profit (HK$ Mil)

Fishing

Supply Chain Management

Obtained from PARD Annual Report

Business Segments – By

Revenue (HK$ Mil)

0.00

1,000.00

2,000.00

3,000.00

4,000.00

5,000.00

6,000.00

2008 2009 2010 2011

Fishing

Supply Chain Management

Obtained from PARD Annual Report

Geographical

Breakdown

65%

18%

8% 7%

1% 1% 0%

Sales (HK$ Mil)

China & Hong Kong

Africa

Europe

East Asia

North America

Others

South America

Valuation DCF Valuation

Free Cash Flow to Firm Estimate Revenue of Segments Apply Operating Margins Calculate Free Cash Flow to Firm Calculate Fair Price

Peer Comparison P/E Comparison

Trading Data

Last Done 0.149

52wk Range: 0.14 - 0.28

Volume 1,598,000

Avg Volume (3 mnths) 1,829,800

Market Cap 475.91M

Discounted FCFF HK$ Mil

Book Value of Equity: 10362.298

Book Value of Debt: 10058.191

Annual Interest Payment: 443

Tax Rate: 5%

Risk Free Rate: 2.64%

Market Risk Premium: 10.60%

Beta: 1.223

Beta Std Dev: 0.099

Equity Risk Premium: 12.38%

Long Term ERP 11.69%

Interest Rate: 4.40%

WACC: 8.34%

Discounted FCFF

Asset Turnover

Fishing 42%

Frozen Fish Supply Chain Management 60%

Overheads Ratio 13.5%

Effective Tax Rate 5%

WACC 8.34%

Long-Term Growth Rate 2%

Long-Term WACC 7.99%

SGD/HKD 0.1606

Discounted FCFF HK$ Mil Y/E 28 Sep 2011 2012E 2013E 2014E 2015E

Revenue

Fishing $5,346.51 $6,148.49 $6,763.34 $7,439.67 $7,588.46

Frozen Fish Supply Chain Management $4,369.43 $4,806.37 $5,287.01 $5,815.71 $5,932.03

Operating Margin

Fishing 26.69% 28% 28% 28% 28%

Frozen Fish Supply Chain Management 9.00% 9.50% 9.50% 9.50% 9.50%

Operating Income (Segments)

Fishing $1,426.79 $1,721.58 $1,893.73 $2,083.11 $2,124.77

Frozen Fish Supply Chain Management $393.22 $456.61 $502.27 $552.49 $563.54

Unallocated Costs/ Overheads $265.74 $294.05 $323.46 $355.81 $362.92

EBIT $1,554.27 $1,884.13 $2,072.54 $2,279.79 $2,325.39

Tax $30.50 $37.68 $41.45 $45.60 $465.08

EBIT (1-T) $1,523.77 $1,846.44 $2,031.09 $2,234.20 $1,860.31

Net Capital Expenditures

Fishing -688.57 -

$1,909.47 -

$1,463.93 -

$1,610.32 -$354.27

Frozen Fish Supply Chain Management -418.5 -$728.24 -$801.06 -$881.17 -$193.86

FCFF $416.70 -$791.26 -$233.90 -$257.29 $1,312.18

Discounted FCFF

Firm Value (HK$ Mil) $16,028.00

Debt (HK$ Mil) $10,058.19

Cash (HK$ Mil) $218.07

Equity Value (HK$ Mil) $6,187.88

Minority Interest (%) 30.00%

Minority Interest (HK$ Mil) $1,856.36

Shareholder's Value (HK$ Mil) $4,331.51

Total Number of Shares 3,193,994,892

Fair Value (HK$) $1.36

Fair Value (SGD $) $0.218

Sensitive Analysis

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

1 1.05 1.1 1.15 1.2 1.25 1.3 1.35 1.4 1.45

Sensitive Analysis

Fair Price

Peer Comparison – P/E Companies Chosen

TSIT WING INTL KHONG GUAN FLOUR CONSCIENCE FOOD FOOD EMPIRE HLDG VIZ BRANZ LTD QAF LTD KENCANA AGRI CHINA MINZHONG DEL MONTE PAC LT PEOPLE'S FOOD MEWAH INTERNATIO PAC ANDES RESOUR SINARMAS LAND LT CHINA FISHERY GMG GLOBAL LTD YEO HIAP SENG SUPER GROUP LTD PETRA FOODS LTD INDOFOOD AGRI RE

Peer Comparison – P/E

Pac Andes EPS: 0.029005

Average P/E: 14.42

Pac Andes Fair Price: SGD $0.418

Valuation Fair Price by Discounted FCF SGD $0.218

Fair Price by Peer Comparison SGD $0.418

Current Price SGD $0.149

Risks – Financial Risks Solvency Risk – Moderate Liquidity Risk – Moderate-High

Interest Coverage: 3.1323 Current Ratio: 1.5932 D/A Ratio: 0.49255

Currency Fluctuation HK$ Peg with USD

Large Minority Interest Minority interest of income amounts to 20%-35%

Risk – Operational Risks Family Business Corporate Governance Fishing Segment

Weather changes Over reliance of customer – One customer’s total

revenue amounted to HK$ 1,511 Mil Over-fishing

Supply-Chain Management Dependence on supplier

Unsustainable Tax Rate