研究报告全文：13Mar2023CMBInternationalGlobalMarketsEquityResearchCompanyUpdateCMGETechnology302HKBUYMaintainReaccelerateonstrongpipelineinFY23ETargetPriceHK352UpDownside684CurrentPriceHK209WelikeonlinegamesforitssteadycompetitionlandscapehealthycashflowandresiliencetomacroAsanIP-orientedgamepublisherpioneerCMGEiswellpositionedtocaptureindustrialstructuralrecoverybackedbygamelicenseChinaInternetSectornormalizationandstrongpipelineFY2324EwouldbefruitfulyearsforCMGEwith20titlestobelaunchedegSoulLandShrekCollegeSwordandFairySophieHuang85239000889WenQingSwordandFairWorld仙剑世界aself-developedmetaversesophiehuangcmbicomhkplatformwillbringfurtherupsideifitisexecutedwellWeforecastitstoplinebottomlinetosurge9676xinFY23EResumecoveragewithBUYEasonXuratingwithDCF-basedTPatHK352implying14x11xFY2324EPE85239000849easonxucmbicomhkRidingongamestructuralrecoveryWeturnedmorepositiveongamesectoroutlookin2023forecastindustrialrev7YoYbackedby1StockDatanormalizedpaceofgamelicenseapprovals2abundanthigh-qualityMktCapHKmn6145Avg3mthstoHKmn2822pipelinesand3lowbasein2022SectorgrossinginJanFebperformed52wHighLowHK272110wellwithsteadygrowthofkeyexistinggamesandstrongnewlylaunchedTotalIssuedSharesmn2768titlesegEggyGoandUndawnWelikeonlinegamesforitssteadySourceBloombergcompetitionlandscapehealthycashflowandresiliencetomacrocomparedShareholdingStructuretoothersub-sectorsWeexpectregulatoryrelaxationandrisinggrossingFairviewRidgeInvestment251wouldhelpthissectortorerateCMGEasanIP-orientedgamepublisherPegasusNetwork106pioneeriswellpositionedtocapturetheindustrialstructuralrecoveryBilibili72SourceBloombergStrongpipelinewithgamelicensestosupportreaccelerationWesuggestinvestorstolookbeyondCMGEssoftFY22forecastingrevadjNP-SharePerformanceAbsoluteRelative3190YoYFY2324EwouldbefruitfulyearsforCMGEas20games1-mth0458areplannedtobelaunchedincludingself-developedtitlessuchasSoulLand3-mth367298ShrekCollege斗罗大陆史莱克学院andSwordandFairWorld仙剑世界6-mth17699SourceBloombergandkeytitlessuchasCultivationFantasy我的御剑日记andSwordandFairyWenQing新仙剑之挥剑问情Weforecastrev96YoYinFY23E12-mthPricePerformancewitheightlaunchesinFY23Eandfull-yearcontributionfromtwogamesHK302HKHSIrebasedlaunchedin2H22WeexpectoverseasexpansionmainlyinSoutheastAsia3toacceleratewithrevtogrow227YoYinFY23Eandaccountfor25of3revenueinFY23ENPMwillsequentiallyimprovebackedbyrevenuemix2shifttowardself-developedgamesandoverseasexpansion21ResumewithBUYWeresumedcoveragewithDCF-basedTPatHK3521toreflectimprovingregulatoryenvironmentandcompanysstrongpipeline0Keycatalysts1SwordandFairWorldpromotionvideoPVbyend-MarandMar-22Jun-22Sep-22Dec-222blockbustergamesin2H23ESourceBloombergEarningsSummaryAuditorErnstYoungYE31DecFY20AFY21AFY22EFY23EFY24ERevenueRMBmn38203957272353507403YoYchange264-319638AdjnetincomeRMBmn80761270601812AdjEPSRMB035026003022029YoYgrowth7-24-9075935ConsensusEPSRMBNANA027024032PEx54717358663PSx1111160806Yield33333NetgearingNetcashNetcashNetcashNetcashNetcashSourceCompanydataBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGEMOREREPORTSFROMBLOOMBERGRESPCMBRGOANDhttpwwwcmbicomhk113Mar2023IP-orientedgamepublisherpioneerAsaleadinggamepublisherinChinaCMGEexceleditselfwithabundantvaluableIPreserveandrichpipelineSupportedbydeepcooperationwithIPownersandIPinvestmentCMGEholdsthelargestreserveof123IPs55licensedIPs68proprietaryIPsinChinaWeexpectCMGEtoleverageitsexistingwell-knownIPstoderiveabundantadaptedgamesandattractloyalgameplayerswithlongerlifecycleUnlikemostlistedpeerswhoarehighlydependentonseveralflagshipsCMGEexcelleditselfwithstrongportfolioandpipelinetoguaranteestableperformanceFigure1AbundantIPReservesofCMGESourceCompanydataCMBIGMFigure2CMGEsuccessfullylaunchedanumberofIPgamesSourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAG213Mar2023WellpositionedtocapturegamestructuralrecoveryFY22wasachallengingyearforgamesectorforecastindustrialrev-10YoYduetoweakmacrominorprotectionandlicensesuspensionWeexpectgamesectortoembraceabetteroutlookinFY23Eforecastindustrialrev7YoYgiven1normalizedpaceofgamelicenseapprovals2abundanthigh-qualitypipelineand3lowbaseinFY22Welikeonlinegamesforitssteadycompetitionlandscapehealthycashflowandresiliencetomacrocomparedtoadse-commerceandotherpan-entertainmentsub-sectorsWeexpectregulatoryrelaxationandrisinggrossingwouldhelpthissectortorerateCMGEasanIP-orientedgamepublisherpioneeriswellpositionedtocapturetheindustrialstructuralrecoveryFigure3ChinaonlinegamemktsizeforecastFigure4Chinagamedevelopersoverseasrevenue35025Rmbbn16045Rmbbn203001404015352501201030200100525801502006010015-5401050-102050-15FY19FY20FY21FY22EFY23EFY24E00FY19FY20FY21FY22EFY23EFY24EPConlinegameMobilegameYoYChinagamedevelopersoverseasrevenueYoYSourceGPCCMBIGMestimatesSourceGPCCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE313Mar2023LookingbeyondsoftFY22WemodelCMGEsrev-31YoYinFY22EwithadjNP-90YoYmainlyonheavyinvestmentinSwordandFairWorld仙剑世界andotherself-developedgamesHoweverGPMwouldliftupto396inFY22Evs372inFY21attributabletooverseasexpansionlowerchannelschargeandrevenuemixshifttowardself-developedgamesAsthemarkethasalreadywellanticipatedthesoftnesswesuggesttolookbeyondFY22andmoveintofruitfulFY2324Ebackedby1looseningofregulation2strongpipeline3overseasexpansionand4lowbaseinFY22Figure5CMGErevestimates2019-2024EFigure6Revmixtrend2019-2024E8000Rmbmn100100700080806000605000406040002030004002000201000-200-40FY19FY20FY21FY22EFY23EFY24E0FY19FY20FY21FY22EFY23EFY24EIPlicensingGamedevelopmentIPlicensingGamedevelopmentGamepublishingGamepublishingYoYgrowthoftotalrevenueSourceCompanydataCMBIGMestimatesSourceCompanydataCMBIGMestimatesFigure7GamepublishinggrowthestimatesFigure8Gamedevelopmentgrowthestimates4500Rmbmn1003500Rmbmn350400030080300035002506025003000200250040200015020002015001001500500100010000-20500500-500-400-100FY19FY20FY21FY22EFY23EFY24EFY19FY20FY21FY22EFY23EFY24ESourceCompanydataCMBIGMestimatesSourceCompanydataCMBIGMestimatesFigure9DomesticbusinessgrowthestimatesFigure10Overseasbusinessgrowthestimates5000Rmbmn803500Rmbmn3504500300603000400025035002500403000200200025002015015002000100015001000501000-2050050000-400-50FY21FY22EFY23EFY24EFY21FY22EFY23EFY24ESourceCompanydataCMBIGMestimatesSourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE413Mar2023FY2324EtoreaccelerateonstrongpipelineFY2324EwouldbefruitfulyearsforCMGEasaround20gameswillbelaunchedincludingself-developedtitlessuchasSoulLandShrekCollege斗罗大陆史莱克学院andSwordandFairWorld仙剑世界andkeytitlessuchasCultivationFantasy我的御剑日记andSwordandFairyWenQing新仙剑之挥剑问情Wenowmodelrev96YoYinFY23EmainlyattributabletoeightlaunchesinFY23Eandfull-yearcontributionfromTheKingofFighterAllstars全明星激斗andRakshasaStreetChosenOne镇魂街天生为王bothofwhichwerelaunchedin2H22Althoughblockbustergamesin2H23suchasSoulLandShrekCollege斗罗大陆史莱克学院andSwordandFairWorld仙剑世界havenotbeengrantedlicensesyetwebelievelaunchesarelesslikelytodelayastheCompanysapplicationforgamelicenseshasbeenapprovedWeexpectoverseasexpansionmainlyinSoutheastAsiancountriestoaccelerateandaccountfor25ofrevenueinFY23Evs15inFY22Esupportedbyabundantoverseaspipelineof15titlesWeforecastoverseasrev227YoYinFY23ElowbaseinFY22inwhichoverseasversionsofSoulLandShrekCollege斗罗大陆史莱克学院SwordandFairyWenQing新仙剑之挥剑问情TheKingofFighterAllstars全明星激斗areestimatedtocontribute62oftotaloverseasrevwithannualgrossingofRMB253mn294mn198mnFigure11CMGEkeygamepipelinein20232024TitleChinesetitleLicenseGenreestLaunchdateDetailSwordandFairyWorld仙剑世界NPRGOpenworld3Q23Self-developedSwordandFairyWenQing新仙剑之挥剑问情YPRGCCG2Q23SoulLandShrekCollege斗罗大陆史莱克学院NMMORPG3Q23SwallowedStar吞噬星空YActionCCG1Q23CultivationFantasy我的御剑日记YCCG2Q23Basketball3v3街篮3v3YSports3Q23Self-developedWorldofCastellan城主天下YSLG2Q23Self-developedSoulLandreversetimeandspace斗罗大陆逆转时空NMMORPG2024DreamWorksAllStars梦工厂全明星NARPG2024BattleThroughtheHeaven斗破苍穹NARPG2024DisneyAllStars迪士尼全明星NARPG2024SoulLandLongyuan斗罗大陆龙渊NMMORPG2024SourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE513Mar2023Figure12Pipelineofnewgamesin2023ChinaSourceCompanydataCMBIGMFigure13Pipelineofnewgamesin2023overseasSourceCompanydataCMBIGMFigure14KeytitlestobelaunchedinFY23ESourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE613Mar2023Figure15CMGEsFY22EpreviewRMBmnDec-YEFY19FY20FY21FY22EFY23EFY24E22-24ECAGRRevenue30363820395727235350740365Gamepublishing25532978282021793247393034Gamedevelopment42173090547419413207160IPlicensing621122327016226795Domesticbusiness349823353820443438Overseasbusiness45938815302970177Costofsales195325972483164531564368Grossprofit10831223147310792193303568Sellinganddistributionexpenses230341498231540755Administrativeexpenses5774044467058931259Otherexpenses215031343834Operatingprofit255428499108721987203Otherincomeandgains95389237---Financecosts153524232524ShareofprofitsandlossesofJV204434Shareofprofitsandlossesofassociates11132364Pre-taxprofit34476970578687956250Tax1002757886143Profitfortheperiodfromcontinuingoperations24374264870601812241Profitfortheperiodfromadiscontinuedoperation------Profitfortheperiod24369059470601812241MI51118000Netprofitattributabletoordinaryshareholders24870161270601812241Adjnetprofit61180761270601812241MarginAnalysisGrossmargin363237404141Operatingmargin8111341313Netmargin20211531111GrowthAnalysisRevenue90264-319638Grossprofit1031320-2710338Operatingprofit126817-7857037Netprofit8232-24-8975935SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE713Mar2023CMGEplanstolaunchSwordandFairyWorldin2H23ESwordandFairyWorldaimstobeasocialplatformlikeTapTaptomaintaincoreusersbaseforgamesinthefutureSwordandFairyWorldisanopenworldgameentertainmentandsocialnetworkingMetaverseplatformItwillprovidegamingexperienceonallplatformsincludingmobilephonePCconsoleandVRequipmentandgetasuperimmersivegameexperienceUserscouldenterSwordandFairyWorldwithVRequipmentacquirevirtualidentitiesandexploredifferentregionsinSwordandFairyWorldsuchasexperiencingtheimmersivegameplaysightseeingandenjoyingvirtualperformanceinSwordandFairyMetaverseFigure16IntroductionofSwordandFairyWorldFigure17GameplayofSwordandFairyWorldSourceCompanydataCMBIGMSourceCompanydataCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE813Mar2023MargintosequentiallyimproveWeexpectadjNPMtoimproveto11inFY2324Efrom3inFY22Ebackedbyrevenuemixshifttowardself-developedgamesandoverseasexpansionlowerchannelschargeRDexpensesandSMexpensesratiowouldberelativelystableevenwithnewlaunchesAssuchweforecastCMGEtodeliver65241toplinebottomlineCAGRduringFY22-24EFigure18Self-developedgameasoftotalrevFigure19Overseasgameasoftotalrev10010090908080707060605050404030302020101000FY19FY20FY21FY22EFY23EFY24EFY20FY21FY22EFY23EFY24EOthersSelf-developedgameDomesticgameOverseasgameSourceCompanydataCMBIGMestimatesSourceCompanydataCMBIGMestimatesFigure20Margintrend454035302520151050FY20FY21FY22EFY23EFY24EGPMNPMSourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE913Mar2023ResumewithBUYTPatHK352WeresumedcoveragewithBUYratingwithDCF-basedTPatHK352implying14x11xFY2324EPEtoreflectimprovingregulatoryenvironmentandCompanysstrongpipelineOurDCF-basedFY23EPEforCMGEisnotdemandingasitisinlinewithSMID-capsand834discounttoChinapeersglobalpeersThestockreboundedby76fromitstroughinOct2022YTD12andoutperformedChinaonlinegamesectorwithlowFY23EPEforrelativelyshortsuccessfulgamelaunchtrackrecorddespitestrongpipelineButwestillseeupsideaheadgiven1wemakeconservativeestimatesonsomehigh-qualitytitlesegWorldofCastellanandBasketball3v32valuationmaybeboostedbySwordandFairyWorldaplatformgamewhichaimstomaintaincoreusersbaseforgamesinthefutureThestockistradingat86x63xFY2324EPEwithattractivevaluationWeexpectitsmultipletorerateconsideringitsabundantpipelinestrongearningsgrowthandlowgrossingconcentrationKeycatalysts1SwordandFairWorldpromotionvideoPVbyend-Marand2blockbustergamesin2H23EFigure21CMBIGMestimatesvsconsensusCMBIGMConsensusDiffRMBmnDec-YE2022E2023E2024E2022E2023E2024E2022E2023E2024ERevenue272353507403290147726075-61121219Grossprofit107921933035115619072415-67150257Operatingprofit1087219873077401022-649-26-34Adjnetprofit70601812NA559843NA75-37AdjEPSRMB003022029027024032-906-76-83Grossmargin396410410399400398-03ppts10ppts12pptsOperatingmargin40135133106155168-66ppts-20ppts-35pptsAdjnetmargin26112110NA117139NA-05ppts-29pptsSourceCMBIGMestimatesBloombergFigure22DCFvaluationDCFValuationRmbmn2022E2023E2024E2025E2026E2027E2028E2029E2030EEBIT100712980127816101965233327043070Tax886143222280342406470534DA91011111212131414Changeinworkingcapital161782698733770808849891936CAPEX303030323335363840FCF232176119302539792105413181574FCFGrowth1557847332519PV2321761032293564565295755819TerminalValue13728AssumptionsWACC148Taxrate-170Riskfreerate395Beta12Marketriskreturn130Costofequity148Longtermgrowth30WACC1314151617EquityValue15397358325298274PV789220410368334304279TerminalminusNetdebtRmbmn77225424379342311285growthminusMinorityinterestRmbmn030439391352319291rateEquityValueRmbmn866435456405363328298FX08940475419374337306TargetPriceHKbasedonDCF35245496435386347314SourceCMBIGMestimatesBloombergPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1013Mar2023Figure23CompstableCompanyTickerMktcapCurrencyPriceCMBICMBIPEPSFY22-24EPSUSDmnRaitingTPFY22EFY23EFY24EFY22EFY23EFY24ECAGRCMGE302HK783HKD21BUY352NA8663181109241DomesticGameTencent700HK443678HKD364BUY45026321518556504519NetEaseNTESUS56419USD86BUY1161671511353734318XDInc2400HK1591HKD26NANANANA320332520NAKingsoft3888HK4738HKD27NANANA509309433631NAIGG799HK444HKD3NANANA705119070707NAFriendTimes6820HK319HKD1BUY3NA8747141209389ArchosaurGames9990HK730HKD7NANANANANA512805NAPerfectWorld002624CH4152CNY15BUY4917915713335302616SanqiInteractive002555CH7522CNY23BUY3017315013332272414Average19615212534282214InternationalGameActivisionBlizzardATVIUS62264USD79NANA2031871706665608ElectronicArtsEAUS31029USD113NANA18517215543413810Take-TwoTTWOUS19684USD117NANA34222015137312545ROBLOXRBLXUS25034USD41NANANANANA817264NANintendo7974JT49530JPY5191NANA168188197424445-8BandaiNamco7832JT14001JPY8584NANA1911871692019186SquareEnix9684JT5681JPY6310NANA165163168232021-1ZHoldings4689JT20908JPY373NANA160286230171514-18CyberAgent4751JT4175JPY1123NANA26519214108070738Sony6758JT109839JPY11855NANA1721631471312129Capcom9697JT8664JPY4425NANA32829726397877911OrientalLand4661JT57462JPY21505NANANA80060016613911636Nexon3659JT19712JPY3095NANA24621519865595512Average22020618152474312Average21418917345393413SourceBloombergCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1113Mar2023FinancialSummaryIncomestatementCashflowsummaryYE31DecRMBmnFY20AFY21AFY22EFY23EFY24EYE31DecRMBmnFY20AFY21AFY22EFY23EFY24ERevenue38203957272353507403Pre-taxIncome71765178687956Gamepublishing29782820217932473930DA8213291011Gamedevelopment73090547419413207ChangeinWC72339161782698IPlicensing11223270162267Others11788474132OperatingCF611356251160136COGS25972483164531564368Grossprofit12231473107921933035Capex3030303030Others842965000SM341498231540755InvestingCF872995303030RD4044467058931259Otherexpenses5031343834Equityraised459702---Operatingprofit428499108721987Others3916516511167FinancingCF69516511167Otherincome389237---3524232524FinancecostsNetchangeincash69516511167Associates137798Cashbegofyr77179581988377276970578687956Pre-taxIncomeFX4527---Cashendofyr795819883772839IncomeTax2757886143MI1118---Netprofit70161270601812Adjnetprofit80761270601812BalancesheetKeyratiosYE31DecRMBmnFY20AFY21AFY22EFY23EFY24EYE31DecFY20AFY21AFY22EFY23EFY24ENon-currentassets33214517372540614431SalesmixFixedasset69257Gamepublishing779713800607531Goodwill11081108102310231023Gamedevelopment191229174363433Intangibleassets155537182204226IPlicensing2959263036Others22343457271231293558Total10001000100010001000Currentassets30103325211730103962GrowthrateCash795819883772839Revenue25836312964384Tradereceivables883105278014672002Grossprofit1292052681034384Othercurrentassets133214544557711121EBIT6781677845699369Netprofit3212428867586351Currentliabilities14641788102113221469Bankloans451765608686647PLratiosTradeandotherpayables841867258480667GrossMargin320372396410410Taxpayable138135135135135Pre-taxmargin20117829128129Othercurrentliabilities3421202020Adjnetmargin21115526112110Effectivetaxrate3788100125150Non-currentliabilities66260251251251Deferredtaxliabilities5373737373ReturnsContingentconsideration-178178178178ROE16211214119133Others138---ROA120841093105TotalEquity48015794456954986672SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1213Mar2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMoritsaffiliateshaveinvestmentbankingrelationshipwiththeissuerscoveredinthisreportinpreceding12monthsCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBIGMwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE13