Asia Pacific Equity Research 08 December 2014

Fortune Real Estate Investment Trust

Overweight FORT.SI, FRT SP Price: HK$7.44

Staying positive on DPU accretive potential acquisition

▲ Price Target: HK$8.60 Previous: HK$8.30

We view the proposed acquisition of Laguna Plaza as positive as we estimate the acquisition is DPU accretive and there is potential synergy with Centre de Laguna in the existing portfolio. Our PT is revised up to HK$8.6 on higher FY15E and FY16E DPU estimates.  Acquisition cost looks reasonable: Fortune REIT announced the potential acquisition of Laguna Plaza in Kwun Tong at a consideration of HK$1,918.5 mn, a 7.8% discount to the valuer’s valuation of HK$2,080 mn. The estimated net property yield (NPI) is about 4.3% on valuation and 4.7% on consideration. The NPI yield for this potential acquisition is higher than 3.8% for Fortune Kingswood acquired in 2013 and 4.5% for Belvedere Square and Provident Square acquired in 2012. The higher yield may imply there is relatively less asset enhancement opportunity for Laguna Plaza shortly after acquisition.  Enhancing DPU by 4.6% in FY15E: Monthly rental of Laguna Plaza is about HK$7.5 mn on 72.7% occupancy as at 31 Oct 2014. At the current committed occupancy of 96.7%, we estimate the potential acquisition will enhance FY15E NPI by about HK$100 mn or NPI yield of 5.2% on acquisition cost. Our FY15E and FY16E DPU estimates are adjusted up by 4.6% and 3.7%, respectively. As the mall is located close to Centre de Laguna in the existing portfolio, the proposed acquisition could provide flexibility in tenants mix rebranding.  Acquisition fully funded by debt: While the proposed acquisition will enhance DPU on our estimates, the higher gearing after acquisition may also raise investor concerns. The valuation of the existing portfolio is revised up by 4.5% from HK$30.9 bn at Jun-14 to HK$32.3 bn at Oct-14. Based on the new valuation, the gearing ratio of Fortune will be increased from 29.9% to about 33.9% post acquisition. At Jun-14 valuation, we estimate that post acquisition gearing will be close to 35% which is the regulatory limit. Fortune Real Estate Investment Trust (Reuters: FORT.SI, Bloomberg: FRT SP) HK$ in mn, year-end Dec FY12A FY13A FY14E FY15E Revenue (HK$ mn) 1,114 1,317 1,541 1,774 Net Property Income (HK$ 788 928 1,135 1,311 mn) Core Profit (HK$ mn) 441 439 660 706 Distributable Profit (HK$ mn) 549 642 789 847 EPU (HK$) 0.26 0.25 0.35 0.37 DPU (HK$) 0.32 0.36 0.42 0.45 Revenue growth (%) 22.5% 18.3% 17.0% 15.1% Distribution growth 24.2% 16.9% 22.8% 7.3% Dividend Yield 4.3% 4.8% 5.7% 6.0% NPV per Share (HK$) 8.66 Source: Company data, Bloomberg, J.P. Morgan estimates.

FY16E 1,845 1,371 731 875 0.38 0.46 4.0% 3.3% 6.2% -

Singapore REITs Amy Luk, CFA

AC

(852) 2800 8524 [email protected] Bloomberg JPMA LUK J.P. Morgan Securities (Asia Pacific) Limited

Leo Ng (852) 2800-8522 [email protected] J.P. Morgan Securities (Asia Pacific) Limited

James R. Sullivan, CFA (65) 6882-2374 [email protected] J.P. Morgan Securities Singapore Private Limited Price Performance 8.0 7.5 HK$

7.0 6.5 6.0 5.5 Dec-13

Mar-14

Jun-14

Sep-14

Dec-14

FORT.SI share price (HK$) FTSTI (rebased)

Abs Rel

YTD 19.2% 15.1%

1m 2.9% 3.0%

Company Data Shares O/S (mn) Market Cap (HK$ mn) Market Cap ($ mn) Price (HK$) Date Of Price Free Float(%) 3M - Avg daily vol (mn) 3M - Avg daily val (HK$ mn) 3M - Avg daily val ($ mn) FTSTI Exchange Rate Price Target End Date Price Target (HK$)

3m 3.3% 4.4%

12m 20.6% 14.7%

1,873 13,935 1,798 7.44 08 Dec 14 68.7% 0.60 4.25 0.5 3297.84 7.75 31-Dec-15 8.60

See page 6 for analyst certification and important disclosures, including non-US analyst disclosures. J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. www.jpmorganmarkets.com

Asia Pacific Equity Research 08 December 2014

Amy Luk, CFA (852) 2800 8524 [email protected]

Key catalyst for the stock price: • Rental growth driven by acquisition of Fortune Kingswood and Laguna Plaza as well as asset enhancement of existing properties

Key financial metrics Revenues (HK$) Revenue growth (%) EBITDA (HK$) EBITDA margin (%) Tax rate (%) Net profit (HK$) EPS (HK$) EPS growth (%) DPS (HK$) BVPS (HK$) Operating cash flow (HK$ mn) Free cash flow (HK$ mn) Interest cover (X) Net margin (%) Sales/assets (X) Debt/equity (%) Net debt/equity (%) ROE (%) Key model assumptions HK retail rental reversion Blended occupancy rate

FY13A 1,317 18% 727 55% 23% 445 0.25 -5% 0.36 10.26 804 (4,811) 4.7 34% 0.05 51.4% 47.0% 3.8%

Upside risks to our view: • Better-than-expected retail sales • Higher-than-expected rental income growth generated by the new acquisitions and AEI completion

FY14E 1,541 17% 1,010 66% 18% 664 0.36 42% 0.42 11.03 1,136 1,293 5.0 43% 0.05 42.8% 37.8% 4.0% FY14E 22% 97%

FY15E 1,774 15% 1,176 66% 19% 712 0.38 6% 0.45 11.26 1,298 (389) 3.9 40% 0.05 50.6% 45.0% 4.0% FY15E 17% 97%

FY16E 1,845 4% 1,234 67% 19% 737 0.39 3% 0.46 11.49 1,234 1,489 3.8 40% 0.05 49.2% 43.5% 4.0%

Downside risks to our view: • Lower-than-expected rental upside of Fortune Kingswood after AEI • Lower-than-expected rental reversions • Interest rate hike • Delay in completion of asset enhancement Valuation and price target basis

Our Dec-15 price target of HK$8.6 is based on par with NPV, where a discount rate of 6.44% and long term growth rate of 1% is adopted.

Distributable income (HK$ mn)

642.4

700 549.5

600 500 400

337.8

406.5

442.3

300 200 100 0 FY09

FY10

FY11

FY12

FY13

Distributable income (HK$ mn)

Source: J.P. Morgan estimates.

Source: Bloomberg, Company and J.P. Morgan estimates.

Sensitivity analysis Sensitivity to 5% chg in HK retail rental reversion 50 bps chg in risk free rate

NPV FY15E 2.70% 8.80%

DPU FY14E 3.00% n/a

Source: Bloomberg, Company and J.P. Morgan estimates.

JPMe vs. consensus, change in estimates DPU FY14E JPMe old 0.42 JPMe new 0.42 % chg 0% Consensus 0.42

FY15E 0.43 0.45 5% 0.44

Source: Bloomberg, Company and J.P. Morgan estimates.

Comparative metrics

Hang Lung Group Hang Lung Properties Great Eagle Hong Kong Land Holdings (US$) Hopewell Holdings Hysan Development Kerry Properties SHKP Swire Properties Wharf Holdings Link REIT* Champion REIT* Fortune REIT*

CMP LC 35.55 22.25 26.00 6.84 27.75 35.45 27.70 114.10 23.80 55.65 48.90 3.49 7.44

Mkt Cap HK$Bn 48.17 99.80 17.05 16.09 24.18 37.71 40.01 322.10 139.23 168.63 112.14 20.05 13.94

P/E FY14E 9.4 10.8 9.0 18.1 19.6 17.0 9.9 14.3 20.2 14.5 29.2 18.9 21.1

Source: Bloomberg, Company and J.P. Morgan estimates. Prices are as of 8 December 2014. *NPV for REITs

2

FY15E 13.0 15.9 8.4 17.0 16.5 16.5 10.6 14.0 19.8 13.9 28.2 19.6 19.9

NAV discount Dec-15 -32% -37% -58% -38% -49% -42% -61% -38% -35% -41% 3% -11% -14%

P/BV FY14E 0.64 0.77 0.34 0.59 0.55 0.58 0.50 0.75 0.66 0.60 1.17 0.44 0.67

FY15E 0.62 0.75 0.35 0.59 0.55 0.57 0.49 0.73 0.65 0.59 1.01 0.43 0.66

YTD Stock perf. -9% -9% -2% 16% 6% 6% 3% 16% 21% -6% 30% 2% 19%

Amy Luk, CFA (852) 2800 8524 [email protected]

Asia Pacific Equity Research 08 December 2014

Investment Thesis, Valuation and Risks Fortune Real Estate Investment Trust (Overweight; Price Target: HK$8.60) Investment Thesis In addition to organic growth, acquisition is also a key growth driver for Fortune REIT. Fortune Kingswood acquired in October 2013 from parent company Cheung Kong contributed to meaningful growth of 1H14 Net Property Income (NPI). Out of the strong NPI Y/Y growth of 32.8% in 1H14, Kingswood accounted for 24.8% of the growth. Given the mall has 46.5% of leases expiring this year and the mall is relatively under-rented, we expect the rental uplift in 2H14 to continue. The new acquisition of Laguna Plaza will also contribute to rental growth in 2015. Moreover, the potential asset enhancement of the mall can further enhance DPU in the longer term. Valuation Our Dec-15 price target of HK$8.6 is based on par with NPV, where we adopt a discount rate of 6.44% and a long-term growth rate of 1%. Key assumptions Bond Rate Beta Index Ratio Discount Rate LT Growth Terminal Cap Rate

3.00% 0.77 4.50% 6.44% 1.00% 5.44%

Risks to Rating and Price Target Downside risks to our PT include lower-than-expected upside of Fortune Kingswood after AEI, lower-than-expected rental reversions and a delay in the completion of asset enhancement.

3

Asia Pacific Equity Research 08 December 2014

Amy Luk, CFA (852) 2800 8524 [email protected]

Fortune Real Estate Investment Trust: Summary of Financials Income Statement HK$ in millions, year end Dec Revenues % change Y/Y EBIT % change Y/Y EBIT Margin Net Interest Earnings before tax % change Y/Y Tax as % of EBT Core net profit % change Y/Y Distributable income % change Y/Y Shares outstanding EPS (reported) (HK$) % change Y/Y Core EPS (HK$) % change Y/Y Balance sheet HK$ in millions, year end Dec Cash and cash equivalents Accounts receivable Inventories Others Current assets

FY13 1,317 18.3% 727 6.6% 55.2% (154) 579 3.7% (134) 23.2% 439 (0.5%) 642 16.9% 1,863 0.25 (5.4%) 0.25 (5.5%)

FY14E 1,541 17.0% 1,010 38.9% 65.5% (200) 814 40.5% (149) 18.4% 660 50.4% 789 22.8% 1,876 0.36 42.3% 0.35 43.4%

FY15E 1,774 15.1% 1,176 16.5% 66.3% (298) 884 8.7% (172) 19.5% 706 7.0% 847 7.3% 1,891 0.38 6.4% 0.37 6.1%

FY16E 1,845 4.0% 1,234 4.9% 66.9% (325) 915 3.5% (178) 19.4% 731 3.5% 875 3.3% 1,907 0.39 2.7% 0.38 2.7%

FY13 858 67 0 67 992

FY14E 1,039 78 0 67 1,184

FY15E 1,205 90 0 67 1,363

FY16E 1,246 94 0 67 1,407

29,932 31,116

32,456 33,819

0 1,050 106 1,156 8,860 410 10,425 20,691 11.03

0 1,208 106 1,314 10,779 435 12,529 21,290 11.26

LT investments Net fixed assets 29,338 Total Assets 30,330 Liabilities ST loans 970 Payables 897 Others 106 Total current liabilities 1,973 Long-term debt 8,860 Other liabilities 387 Total Liabilities 11,221 Shareholder's equity 19,109 BVPS 10.26 Source: Company reports and J.P. Morgan estimates.

4

Cash flow statement HK$ in millions, year end Dec EBIT Depr. & amortization Change in working capital Others Cash flow from operations

FY13 727 0 36 323 804

FY14E 1,010 0 164 308 1,136

FY15E 1,176 0 171 415 1,298

FY16E 1,234 0 52 445 1,234

Capex Disposal/(purchase) Net Interest Free cash flow

(5,733) 0 (214) (4,811)

(7) 0 (196) 1,293

(1,926) 0 (292) (389)

(7) 0 (319) 1,489

Equity raised/(repaid) Debt raised/(repaid) Other Dividends paid Beginning cash Ending cash DPS (HK$)

958 5,053 (219) (588) 578 858 0.36

0 0 (200) (752) 858 1,039 0.42

0 1,919 (298) (832) 1,039 1,205 0.45

0 0 (325) (868) 1,205 1,246 0.46

Ratio Analysis %, year end Dec EBIT margin Net margin SG&A/Sales

FY13 55.2% 33.3% -

FY14E 65.5% 42.8% -

FY15E 66.3% 39.8% -

FY16E 66.9% 39.6% -

12.4% 18.3% (0.5%) (5.5%) 4.7 32.0% 47.0% 0.1 1.5 3.8% 2.3%

11.5% 17.0% 50.4% 43.4% 5.0 27.4% 37.8% 0.1 1.5 4.0% 2.8%

14.2% 15.1% 7.0% 6.1% 3.9 31.0% 45.0% 0.1 1.5 4.0% 3.1%

3.2% 4.0% 3.5% 2.7% 3.8 30.3% 43.5% 0.1 1.6 4.0% 3.1%

Sales per share growth - Sales growth 33,112 Net profit growth 34,519 EPS growth Interest coverage (x) 0 Net debt to total capital 1,257 Net debt to equity 106 Sales/assets 1,363 Assets/equity 10,779 ROE 462 ROCE 12,604 21,915 11.49

Asia Pacific Equity Research 08 December 2014

Amy Luk, CFA (852) 2800 8524 [email protected]

JPM Q-Profile Fortune Real Estate Investment Trust (SINGAPORE / Financials) As Of: 05-Dec-2014

[email protected]

12 Mth Forward EPS

9.00

0.45

8.00

0.40

7.00

0.35

6.00

0.30

5.00

0.25

4.00

0.20

3.00

0.15

2.00

0.10

1.00

0.05

PE (1Yr Forward)

Current:

20.3x

25.0x

Current:

0.37

P/E Relative to Singapore Index

Current:

Jul/14

Nov/13

Jul/12

Mar/13

Nov/11

Jul/10

Mar/11

Nov/09

Jul/08

Mar/09

Nov/07

Jul/06

Mar/07

Nov/05

Jul/04

Mar/05

Nov/03

Jul/02

Mar/03

0.00 Nov/99

Nov/14

Feb/14

Aug/12

May/13

Nov/11

Feb/11

Aug/09

May/10

Nov/08

Feb/08

Aug/06

May/07

Nov/05

Feb/05

Aug/03

May/04

Nov/02

Feb/02

Aug/00

May/01

Nov/99

0.00

Nov/01

7.55

Jul/00

Current:

Mar/01

Local Share Price

1.49

2.50

20.0x

2.00

15.0x

1.50

10.0x

1.00

5.0x

0.50

5%

ROE (Trailing)

Current:

16.52

35.00

Jul/14

Nov/13

Mar/13

Jul/12

Nov/11

Mar/11

Jul/10

Nov/09

Mar/09

Jul/08

Nov/07

Mar/07

Jul/06

Nov/05

Mar/05

Jul/04

Nov/03

Jul/02

Mar/03

Mar/01

Price/Book (Value)

6.97

Current:

1.4x

P/B Trailing

Jul/14

Nov/13

Mar/13

Jul/12

Nov/11

Mar/11

Jul/10

Nov/09

Mar/09

Jul/08

Nov/07

Mar/07

Jul/06

Mar/05

Nov/05

Jul/04

Mar/03

Nov/03

Jul/02

Mar/01

Nov/99

Jul/14

Nov/13

Mar/13

Jul/12

Mar/11

Nov/11

Jul/10

Nov/09

Mar/09

Jul/08

Nov/07

Mar/07

Jul/06

Nov/05

0.0

Jul/04

5.0

0% Mar/05

5%

Mar/03

10.0

Nov/03

10%

Jul/02

15.0

Nov/01

15%

Mar/01

Current:

25.0 20.0

Jul/00

Nov/01

Dividend Yield (Trailing)

Proxy

20%

Nov/99

Jul/00

Jul/14

Nov/13

Mar/13

Jul/12

Mar/11

Current:

Singapore BY

Nov/01

12Mth fwd EY

Jul/00

25%

Nov/11

Jul/10

Nov/09

Mar/09

Jul/08

Nov/07

Mar/07

Jul/06

Nov/05

Jul/04

Mar/05

Nov/03

Mar/03

Jul/02

Nov/01

Mar/01

Jul/00

Nov/99

Earnings Yield (& Local Bond Yield)

Nov/99

0.00

0.0x

0.7x

P/B Forward

30.00 1.2x

25.00 20.00

1.0x

15.00

0.8x

10.00

0.6x

0.00

0.4x

-5.00

0.2x

Jul/14

Nov/13

Mar/13

Jul/12

Nov/11

Mar/11

Jul/10

Nov/09

Mar/09

Jul/08

Nov/07

Mar/07

Jul/06

Nov/05

Mar/05

Jul/04

Nov/03

Jul/02

Mar/03

Mar/01

Nov/01

0.0x Nov/99

Jul/14

Nov/13

Mar/13

Jul/12

Mar/11

Nov/11

Jul/10

Nov/09

Mar/09

Jul/08

Nov/07

Mar/07

Jul/06

Nov/05

Jul/04

Mar/05

Nov/03

Mar/03

Jul/02

Nov/01

Mar/01

Jul/00

Nov/99

-10.00

Jul/00

5.00

Summary Fortune Real Estate Investment Trust 1848.07 SINGAPORE 0.46477 TICKER FRT SP Financials Real Estate Investment Trusts Latest Min Max 12mth Forward PE 20.30x P/BV (Trailing) 0.69 0.20 1.00 Dividend Yield (Trailing) 6.97x 4.14 21.10 ROE (Trailing) 16.52 -6.88 32.49

Median

Average

2 S.D.+

2 S.D. -

0.65 6.44 16.52

0.65 7.04 15.92

0.97 12.75 35.56

0.32 1.33 -3.73

5-Dec-14 As Of: Local Price: 7.55 EPS: 0.37 % to Min % to Max % to Med % to Avg -71% -41% -142%

46% 203% 97%

-5% -8% 0%

-6% 1% -4%

Source: Bloomberg, Reuters Global Fundamentals, IBES CONSENSUS, JPMorgan Quantitative & Derivative Strategy

5

Asia Pacific Equity Research 08 December 2014

Amy Luk, CFA (852) 2800 8524 [email protected]

Analyst Certification: The research analyst(s) denoted by an “AC” on the cover of this report certifies (or, where multiple research analysts are primarily responsible for this report, the research analyst denoted by an “AC” on the cover or within the document individually certifies, with respect to each security or issuer that the research analyst covers in this research) that: (1) all of the views expressed in this report accurately reflect his or her personal views about any and all of the subject securities or issuers; and (2) no part of any of the research analyst's compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed by the research analyst(s) in this report. For all Korea-based research analysts listed on the front cover, they also certify, as per KOFIA requirements, that their analysis was made in good faith and that the views reflect their own opinion, without undue influence or intervention.

Important Disclosures Company-Specific Disclosures: Important disclosures, including price charts, are available for compendium reports and all J.P. Morgan– covered companies by visiting https://jpmm.com/research/disclosures, calling 1-800-477-0406, or e-mailing [email protected] with your request. J.P. Morgan’s Strategy, Technical, and Quantitative Research teams may screen companies not covered by J.P. Morgan. For important disclosures for these companies, please call 1-800-477-0406 or e-mail [email protected]. Date

Fortune Real Estate Investment Trust (FORT.SI, FRT SP) Price Chart 18 OW HK$4.9

N HK$6.7

12

OW HK$4 OW HK$3.6

OW HK$6.7

Price(HK$)

OW HK$4.45

6

0 Oct 06

Apr 08

Oct 09

09-May-07 OW

4.82

6.70

01-Aug-07 N

5.06

6.70

29-Jan-09

OW

1.94

2.70

07-May-09 OW

2.52

4.00

29-Jul-09

OW

3.32

4.90

25-Aug-09 OW

2.97

3.40

OW

2.75

3.60

05-May-10 OW

3.59

4.00

09-Nov-10 OW

4.08

4.90

24-Jul-11

OW

4.01

5.00

07-Oct-11

OW

3.24

4.30

13-Nov-11 OW

3.65

4.45

31-Jan-12

OW

3.89

4.88

10-May-12 OW

4.17

5.00

20-Jul-12

OW

4.90

5.70

31-Oct-12

OW

6.02

6.40

25-Jan-13

OW

6.60

6.90

09-May-13 OW

7.83

8.10

22-Jul-13

OW

7.22

8.20

11-Nov-13 OW

6.32

8.00

26-Jan-14

OW

5.88

7.90

24-Jul-14

OW

7.23

8.40

30-Oct-14

OW

7.06

8.30

OW HK$4.3 OW HK$5.7 OW HK$6.9 OW HK$8.2 OW HK$7.9 OW HK$8.3 04-Nov-09

OW HK$2.7 OW HK$3.4 OW HK$4 OW HK$4.9 OW HK$5 OW HK$4.88 OW HK$5 OW HK$6.4 OW HK$8.1 OW HK$8 OW HK$8.4

Apr 11

Source: Bloomberg and J.P. Morgan; price data adjusted for stock splits and dividends. Initiated coverage May 09, 2007.

Oct 12

Apr 14

Rating Share Price Price Target (HK$) (HK$)

The chart(s) show J.P. Morgan's continuing coverage of the stocks; the current analysts may or may not have covered it over the entire period. J.P. Morgan ratings or designations: OW = Overweight, N= Neutral, UW = Underweight, NR = Not Rated Explanation of Equity Research Ratings, Designations and Analyst(s) Coverage Universe: J.P. Morgan uses the following rating system: Overweight [Over the next six to twelve months, we expect this stock will outperform the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Neutral [Over the next six to twelve months, we expect this stock will perform in line with the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Underweight [Over the next six to twelve months, we expect this stock will underperform the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Not Rated (NR): J.P. Morgan has removed the rating and, if applicable, the price target, for this stock because of either a lack of a sufficient fundamental basis or for legal, regulatory or policy reasons. The previous rating and, if applicable, the price target, no longer should be relied upon. An NR designation is not a recommendation or a rating. In our Asia (ex-Australia) and U.K. small- and mid-cap equity research, each stock’s expected total return is compared to the expected total return of a benchmark country market index, not to those analysts’ coverage universe. If it does not appear

6

Amy Luk, CFA (852) 2800 8524 [email protected]

Asia Pacific Equity Research 08 December 2014

in the Important Disclosures section of this report, the certifying analyst’s coverage universe can be found on J.P. Morgan’s research website, www.jpmorganmarkets.com. Coverage Universe: Luk, Amy Ka Ping: Champion REIT (2778.HK), Fortune Real Estate Investment Trust (FORT.SI), Great Eagle (0041.HK), Hang Lung Group (0010.HK), Hang Lung Properties (0101.HK), Hongkong Land (HKLD.SI), Hysan Development Co (0014.HK), Jinmao Investments (6139.HK), Link REIT (0823.HK), New World Development (0017.HK), Swire Properties (1972.HK), The Wharf (Holdings) Limited (0004.HK) J.P. Morgan Equity Research Ratings Distribution, as of September 30, 2014 Overweight Neutral Underweight (buy) (hold) (sell) J.P. Morgan Global Equity Research Coverage 46% 42% 12% IB clients* 57% 49% 34% JPMS Equity Research Coverage 46% 48% 7% IB clients* 76% 67% 51% *Percentage of investment banking clients in each rating category. For purposes only of FINRA/NYSE ratings distribution rules, our Overweight rating falls into a buy rating category; our Neutral rating falls into a hold rating category; and our Underweight rating falls into a sell rating category. Please note that stocks with an NR designation are not included in the table above.

Equity Valuation and Risks: For valuation methodology and risks associated with covered companies or price targets for covered companies, please see the most recent company-specific research report at http://www.jpmorganmarkets.com, contact the primary analyst or your J.P. Morgan representative, or email [email protected]. Equity Analysts' Compensation: The equity research analysts responsible for the preparation of this report receive compensation based upon various factors, including the quality and accuracy of research, client feedback, competitive factors, and overall firm revenues. Registration of non-US Analysts: Unless otherwise noted, the non-US analysts listed on the front of this report are employees of non-US affiliates of JPMS, are not registered/qualified as research analysts under NASD/NYSE rules, may not be associated persons of JPMS, and may not be subject to FINRA Rule 2711 and NYSE Rule 472 restrictions on communications with covered companies, public appearances, and trading securities held by a research analyst account.

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Amy Luk, CFA (852) 2800 8524 [email protected]

Asia Pacific Equity Research 08 December 2014

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Amy Luk, CFA (852) 2800 8524 [email protected]

Asia Pacific Equity Research 08 December 2014

intended as recommendations of particular securities, financial instruments or strategies to particular clients. The recipient of this report must make its own independent decisions regarding any securities or financial instruments mentioned herein. JPMS distributes in the U.S. research published by non-U.S. affiliates and accepts responsibility for its contents. Periodic updates may be provided on companies/industries based on company specific developments or announcements, market conditions or any other publicly available information. Clients should contact analysts and execute transactions through a J.P. Morgan subsidiary or affiliate in their home jurisdiction unless governing law permits otherwise. "Other Disclosures" last revised November 29, 2014.

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