研究报告全文：MN12Apr2023CMBInternationalGlobalMarketsEquityResearchCompanyUpdateXtep1368HKStrong1Q23withretailsalesguidanceraisedTargetPriceHK1176Beatin1Q23EwasindustryleadingandFY23EguidancewaspartlyraisedPreviousTPHK1054HencewemaintainBUYgivenitsattractiveoutlookandvaluation08xPEGUpDownside1891Q23retailsalesgrowthwasanindustryleadingbeatXtepsretailsalesCurrentPriceHK990growthwasat20betterthanCMBIestof18consistingof30ChinaConsumerDiscretionary40growthforXtepKidsprofessionalrunningshoesOfflinehadoutperformedonlinewhilebothhadregisteredpositivegrowthMoreoverWalterWOOretailsalesgrowthinMar-Apr2023hadacceleratedto35frommid-85237618776walterwoocmbicomhkteensinJan-Feb2023WethinkthisbeatfarbettervsAntaandLiNingwasaresultof1strongerthanexpectedreplenishmentandquickresponseRaphaelTSEorders2successfulmarketingthroughwinningandbreakingvarious85239000856marathonsinChinawithathleteswearingXtepsrunningshoes3robustraphaeltsecmbicomhkdemandforrunningvsfashionandbasketballasthepenetratedrateinStockDatalowertiercitiesisstilllowand4increaseddemandforvalue-for-moneyMktCapHKmn245831productsundereconomicrecoveryNotethatSauconysretailsalesgrowthAvg3mthstoHKmn94wasalsospectacularat100beatingFY23Eguidanceof60to7052wHighLowHK1478685TotalIssuedSharesmn26348Reviseduptheretailsalesgrowthtargetto25inFY23EfromSourceFactSet20Thankstothesolidresultin1Q23aswellas1lowbasesaheadShareholdingStructure2favourablepricerangeandsub-segment3excellentbrandmomentumMrDingShuiPoFamily490yieldfrombreakingrecordsatandwinningdifferentmarathonsand4moreJPMorganChase46thanpeersASPincreasesthroughsellingmoreproductspricedatRMB500-SourceHKEx700Managementbelieveditsretailsalesgrowthin2Q23EwillnotbeslowerSharePerformancethanthatin1Q23andalsoraiseditsFY23Eguidancefrom20to25AbsoluteRelativeButstayedrelativelyconservativeaboutguidanceforlisted-coin1-mth141763-mth3179FY23EManagementraisedtheirforecastsfor1H23Efrom0sales6-mth175-34growthto5to10becauseofthebeatin1Q23andtheirpositiveviewSourceFactSeton2Q23EHowevertheFY23Eguidancemid-teenssalesgrowthanda12-mthPricePerformancefasternetprofitgrowthwaslargelyunchangedasitisstillhighlysubjecttotheperformanceduring5-1goldenweekandopexspendingcouldstillbehugeForexampleAPexpenseswouldstillbehighat11to13ofsalesinFY23EafterChinasre-openingasXtepstepsupitssponsorshipformarathonsandathletesbothdomesticandoverseasrunnersplusthemarketingduringAsianGames2023andinvestmentsonXtepKidsetcMaintainBUYandraisedTPtoHK1176basedon23xFY23EPE13SourceFactSetsdabovethe5yearsaverageof15xWefine-tunedFY23E24E25Enetprofitby11-2tofactorinfastersalesgrowthbutalowerOPmarginItistradingat19xFY23EPEnotdemandingatallEarningsSummaryYE31DecFY21AFY22AFY23EFY24EFY25ERevenueRMBmn1001312930151871762920093YoYgrowth225291175161140OperatingprofitRMBmn13961464182421922609NetprofitRMBmn88949123120211491118256EPSReportedRMB036036047060074YoYgrowth72106326265234PEx227245194157128PBx2628262422Yield2720313847ROE119113139160182NetgearingNetcashNetcashNetcash4792SourceCompanydataBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1MOREREPORTSFROMBLOOMBERGRESPCMBRGOORhttpwwwcmbicomhk12Apr2023Chanelinventoryandretaildiscountswerebothinlineandareexpectedtobenormalizedby4Q23EInventorytosalesratioloweredtobelow5monthsin1Q23improvingfrom55monthsin4Q22butstillhigherthan4monthsin1Q22Howevermanagementalsopointedoutthattheinventorymixisfairlyhealthynewproductsaccountedfor90andtheyaimedtoclearmostoftheexcessiveinventoriesbyOct2023Retaildiscountwas25to30offin1Q23narrowingfrom30offin4Q22butstillyettoreturnto25offin1Q22EarningsrevisionFigure1EarningsrevisionNewOldDiffRMBmnFY23EFY24EFY25EFY23EFY24EFY25EFY23EFY24EFY25ERevenue151871762920093151131755020008050504Grossprofit625373058379622472738345050404EBIT1824219226091807217426500908-16Netprofitatt1192147418031181146118321009-16DilutedEPSRMB0453055906840448055506951009-16Grossmargin4124144174124144170ppt0ppt0pptEBITmargin12012413012012413201ppt0ppt-03pptNetprofitattmargin7984907883920ppt0ppt-02pptSourceCompanydataCMBIGMestimatesFigure2CMBIGMestimatesvsconsensusCMBIGMConsensusDiffRMBmnFY23EFY24EFY25EFY23EFY24EFY25EFY23EFY24EFY25ERevenue15187176292009315042179432100410-17-43Grossprofit62537305837962277490879704-25-48EBIT182421922609173221392567542516Netprofitatt119214741803115214371749352531DilutedEPSRMB045305590684044105490666261827Grossmargin412414417414417419-02ppt-03ppt-02pptEBITmargin12012413011511912205ppt05ppt08pptNetprofitattmargin79849077808302ppt03ppt06pptSourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE212Apr2023ResultsSummaryFigure3ResultssummaryHalfYearHalfyearly1H222H221H232H231H222H231H23E2H23ERMBmnYoYYoYEYoYEYoYRevenue56847247618390043723924COGS-3297-4342-3568-5366Grossprofit238729052616363838191025GPmargins420401423404Otherincomegains23779216118SDexpenses-1046-1644-1113-19453547618SDexpsales-184-227-180-216Adminexpenses-656-798-699-10073613626Adminexpsales-115-110-113-112Otheropex0000OperatingprofitEBIT922543102080435-241148OPmargins1627516589Otheritems0000Netfinanceincome-28-63-31-51Netfinanceincomesales-05-09-05-06Profitafterfinancingcosts893480989753Associatedcoms-11-1-126Jointlycontrolledcoms0000Pre-taxprofit88247997775937-251159Tax-293-155-303-235Taxsales-52-21-49-26Effectivetaxrate-332-325-310-310Minorityinterests-1-823Netprofitatt59033167252038-311457NPmargins1044610958SalesbysegmentMassmarket48986230524076133619722Athleisure630773692101936521032Professionalsports157244250372106956053Total56847247618390043723924SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE312Apr2023Figure4Resultssummary-FullYearFY22FY23EFY24EFullyearlyRMBmnFY22FY23EFY24EYoYYoYYoYRevenue129301518717629291716COGS-7639-8934-10324Grossprofit529262537305271817GPmargins409412414Otherincomegains317334370SDexpenses-2690-3058-3531421415SDexpsales-208-201-200Adminexpenses-1454-1705-1952221714Adminexpsales-112-112-111Otheropex000OperatingprofitEBIT14641824219252520OPmargins113120124Otheritems-12-617Netfinanceincome-91-82-88Netfinanceincomesales-07-05-05Profitafterfinancingcosts136117362120Associatedcoms000Jointlycontrolledcoms000Pre-taxprofit13611736212062822Tax-449-538-636Taxsales-35-35-36Effectivetaxrate-330-310-300Minorityinterests-9511Netprofitatt9221192147412924NPmargins717984SalesbysegmentMassmarket111281285314766261615Athleisure140317112030442219Professionalsports400622832995634Total129301518717629291716SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE412Apr2023OperatingnumbersFigure5SportswearbrandssalesgrowthtrendOperatingnumbers1Q192Q193Q194Q191Q202Q203Q204Q201Q212Q213Q214Q211Q222Q223Q224Q221Q23E2Q23E3Q23E4Q23ENikeChinasales240220270230-4010801904209010-240-80-200-1306000200100100AdidasChinasales160140110150-58000-50701560-160-150-240-350-350-270-500-200150100400AntabrandsSSSGveLow-veMid-veMid-veHigh--ve20-veLow-veMid-veHigh-Antabrandsretailsales-veLSDveLSDveLSD40-4535-40-veMSDveMSD-veHSD100100160230teensteensteensteens25teensteensteensveLow-veLow--ve20-veMid--veLow--veMid-CorebrandveHSDveHSD-veLSD-veMSD-veMSD35-4035-40veHSDveMSDveLSDteensteens25teensteensteens-ve20-veLow--veLow-veMid--veHigh-KidsOver2030Over2525veMSD45-50Over20veMSD20-25veLSDveHSD25teensteensteensteensveMid-Online2535Over40veMSDOver40Over50Over25Over60Over4525-3030-35Over30veHSDveHSDveMSDteensveLow-veLow--veLow-FILAbrandsretailsales50-5550-55-veMSD20-2525-3075-8030-35veMSDveHSDveMSD-veHSD120160110200teensteensteens-ve20--veMid-ClassicCorebrandOver40veMSDveMSDveMSD80Over20FlatFlat-veMSD-veDD-veLSD25teensveMid-veMid-veMid--veLow-KidsOver70-veLSDOver30Over30Over20100Over40veHSDveLSDteensteensteensteensOverveMid-veLow-FusionveMSDOver70Over50Over50150Over80Over20-veMSDveLSDveHSD100teensteensOnlineOver70160Over80Over9070-80Over40Over4020-2525-30Over20veMSDOver65Over40115-veLow-Otherbrands30-3525-30-veHSD25-3050-5555-6070-7535-4030-3540-4520-2540-45120teensOverveMid--veLow-DescenteOver905050Over6090Over801501005040-4540-45Over20Over35100teensteens-veHigh--veHigh--veHigh-Kolon152020veLSD20-2530-40Over75403040-45Over20Over55teensteensteensveMid-veMid-veHigh-veLow-veLow-veLowveHighveLowveLow-veLow--veHigh-LiNinggroupsSSSGna-veMSDveLSDnaveHSDteensteensteenstwentiesteens80202020teensteensveLow-veLow-veHigh--veHigh-veLowveLowveMidveMid-veHigh--veHighDirectretailveHSDna-veMSDveHSDnaveMSDteensteensteensteens90302020teens20veLow-veLow-veLow-veMid--veLow-veLowveMidveHigh-veLow--veHigh--veLowWholesalesna-veMSDveMSDnaveHSDteensteensteensteensteens7020teensteensteens20veHighveMidveMidveLowveLow-veMidveHighveLowveHighveMidveHighveMidveLow-E-CommercenaveLSD-veLSD30305040teens20303080302030teensveLowveLowveLowveMid-veHigh-veMid-veHighveLowveLowveLowveHighveMid--veLow-LiNinggroupsretailsales-veMSDveMSD-veHSD201305031020-2520-2530-3530-40teensteens8090403020teensteensveLow-veMid-veHigh--veMid-veLow-veLowveHighveMidveHighveMidveLow-veMid-DirectretailveHSDFlatveMSD-veHSDteensteensteens30teens908030203020teensveLowveMid-veMid-veLow-veHigh-veLow-veLowveLowveHighveHighveLowveLow--veLowWholesales-veHSD-veLSD-veHSD20-25203040teensteens8090302020teens20veLowveHighveLowveLowveLow-veHighveLowveMidveHighveMidveLowveMidveMidE-Commerce100veMSDveMSD40205040teens2040309050403020veLow-veLow-veLow-XtepsSSSG10teensteensteens-ve20-Mid50-veMid-veMid-XtepsretailsalesOver20Over2020Over20-veLSDveMSDveHSD30-3520-2530-3520-25-veHSD2002001303102560teensteens361DegreesSSSGveLSDveLSDveLSDveLSD-ve20--veLow-veHigh-veLow-veHigh-veHigh-veLow-veMid-361Degreesretailsales-veHSDveLSD15-20Flat25teensteensteensteensteensteensteensPouShengsSSSG84426019-325-178PouShengssales199189219191-25103-0310478-150-251-267-250-241-85-2047018070200-ve20--veHigh--veHigh-veHigh-Topsportsretailsales-veLSD25teens20teensveMidveMidveMid-veMidto-veLow-veLowveLow-veHigh--veLow-veMid-DongXiangsSSSG-veLSDveMSDtoHightoHigh-veMSDveMSDveHSDtoHighHigh--veMSDtoMid-toMidSDtoMidSDteenstoMidSDteensSDSDSDteensteensveLow-veMidto-veMidto-veMidveMid-veLow--ve25-veLow-veLow--veMid-DongXiangsretailsalesveMSDveMSDveMSD60-70toMid-High--veMSDHigh-veLSD20toteensteensto30MidSDteensteensteensteensteens30-ve30--veLow-DirectretailFlatveLSDveHSDveMSDFlatveMSD70-7535teensve35-ve30-ve55-ve40--veLow-ve30-ve30-ve20-E-Commerce35-4045356045teens353530SourceCompanydataCMBIGMestimatesNikesyearendisinMayeg4Q18calendaryear2Q19fiscalyearSep-Nov2018PLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE512Apr2023AssumptionsFigure6MajorassumptionsMajorassumptionsFY21AFY22AFY23EFY24EFY25ESalesbysegmentRMBmnShoes5928776092631084212443Apparels38874897563164767318Accessories198273292310332Total1001312930151871762920093SalesbysegmentgrowthShoes175309194170148Apparels312260150150130Accessories225383706070Total225291175161140SalesbysegmentRMBmnMassmarket884111128128531476616700Athleisure9711403171120302315Professionalsports2014006228321078Total1001312930151871762920093SalesbysegmentgrowthYoYMassmarket245259155149131Athleisure-28445220186140Professionalsports1803990556338296Total225291175161140SalesnetworkXtep47224493462847674910Xtepkids11791520167217891878Overseastores250300300300300Total61516313660068567088GPmargins417409412414417OpexbreakdownAPsales102119113115115Staffcostssales111113114112111RDsales2523252525DAsales1719161514Provisionswritebackssales-0204030202Rentalsales0101040404Sellingdistributioncostssales189208201200199Adminexpensessales119112112111109Total308320314311308OPmargins139113120124130Effectivetaxrate309330310300290Netprofitattmargins9171798490Netprofitattgrowth77115294236223SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE612Apr2023ValuationFigure7Peersvaluationtable3yrs12mUpPBROEYieldYTDPriceMktCapYearPExPEGTPDown-xperfxCompanyTickerRatingLCLCsideHKmnEndFY1EFY2EFY1EFY1EFY1EFY1EFY1EHsharesSportswearXtepIntl1368HKBUY11769901926103Dec-22194157251140831139AntaSports2020HKBUY126051129012306368Dec-22282233652401416104LiNing2331HKBUY6644588013154999Dec-22270220481791411132361Degrees1361HKNRna380na7857Dec-22766607990455141Topsports6110HKNRna723na44835Feb-22188149352133040168PouSheng3813HKNRna067na3569Dec-22674104110124107ChinaDX3818HKNRna034na1972Mar-22na9802140003481Avg17913827102103056Med191149251140831104InternationalSportswearNikeIncNKEUSNRna12191na1470870May-22376303130373471142AdidasADSGYNRna16644na256578Dec-22na43266980005306PumaPUMGYNRna5488na70888Dec-2222516930149121532UnderArmourUAAUSNRna919na30340Mar-2316914720na100095LululemonLULUUSNRna36337na362975Jan-233142741082901000134SkechersSKXUSNRna4708na57389Dec-22161130171090700122VfCorpVFCUSNRna2180na66510Apr-2210598261191181210ColumbiaCOLMUSNRna8860na43244Dec-2216915225159151412WolverineWWWUSNRna1637na10143Dec-2211180294020127498MizunoCorp8022JPNRna314500na4928Mar-2211710307813719118AsicsCorp7936JPNRna376500na42145Dec-22285244391251811292Avg203194451100617108Med169152291221011118SourceBloombergCMBIGMestimatesFigure8Forward12MPEvaluationbandSourceBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE712Apr2023FinancialSummaryINCOMESTATEMENT2020A2021A2022A2023E2024E2025EYE31DecRMBmnRevenue81721001312930151871762920093Costofgoodssold49735835763989341032411714Grossprofit319841785292625373058379Operatingexpenses258830814144476354836192Sellingexpense153718912690305835314006Adminexpense8279371155132615111683RDexpense223252299380441502Others000000Operatingprofit91813961464182421922609Otherincome307299317334370422ShareoflossesprofitsofassociatesJV17461261743EBITDA99614801597199223752803Depreciation6471107127131133Otheramortisation141326405261Interestincome42125393532Interestexpense14485117117117117Otherincomeexpense000000Pre-taxprofit76212871361174021272567Incometax257397449538636742Minorityinterest819951113Netprofit505889912120214911826BALANCESHEET2020A2021A2022A2023E2024E2025EYE31DecRMBmnCurrentassets90271043211484124631349414571Cashequivalents347239303071259720591555Accountreceivables323635284556535162127080Inventories97514971960229326493006Prepayment89914431863218825402895STbankdeposits4373333333333Othercurrentassets811111Non-currentassets354441834491484953005851PPE79611191464186923552925InvestmentinJVsassos218365352346363406Intangibles709671642599545482Othernon-currentassets182020282032203520372038Totalassets125721461515975173111879320422Currentliabilities333440535092585566777501Short-termborrowings642405405405405405Accountpayables147923523079360141624722Taxpayable86123123123123123Othercurrentliabilities112711731485172619872251Non-currentliabilities193925802571257625862599Long-termborrowings151613751375137513751375Othernon-currentliabilities42312051196120112111224Totalliabilities5273663376638431926410100Sharecapital222323232323Retainedearnings467150205185566262526973Otherreserves260529403104319532553325Totalshareholdersequity7299798283138880953010321Minorityinterest0094619Totalequityandliabilities7299798283228884952310302PLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE812Apr2023CASHFLOW2020A2021A2022A2023E2024E2025EYE31DecRMBmnOperatingProfitbeforetaxation76212871361181722722765Depreciationamortization7884132168183195Taxpaid325329449538636742Changeinworkingcapital320447872689747756Others1251071275169251Netcashfromoperations3207011856829031211InvestingCapitalexpenditure207414453532617703Acquisitionofsubsidiariesinvestments430000Others784890000Netcashfrominvesting573329453532617703FinancingDividendpaid2793565916338401050Netborrowings773120000Proceedsfromshareissues3700000Sharerepurchases600000Others557640000Netcashfromfinancing380965916338401050NetchangeincashCashatthebeginningoftheyear297034723930307125972059Exchangedifference11110000Others513469859474538503Cashattheendoftheyear347239303071259720591555GROWTH2020A2021A2022A2023E2024E2025EYE31DecRevenue01225291175161140Grossprofit99306267182168147Operatingprofit25652149246202190EBITDA24648679247192180Netprofit31076126318240224PROFITABILITY2020A2021A2022A2023E2024E2025EYE31DecGrossprofitmargin391417409412414417Operatingmargin112139113120124130EBITDAmargin122148123131135140ReturnonequityROE71116112140162184GEARINGLIQUIDITYACTIVITIES2020A2021A2022A2023E2024E2025EYE31DecNetdebttoequityx020201000001Currentratiox272623212019Receivableturnoverdays144512861286128612861286Inventoryturnoverdays715937937937937937Payableturnoverdays108514711471147114711471VALUATION2020A2021A2022A2023E2024E2025EYE31DecPE404227245194157128PEdiluted404227245194157128PB2912628262422PCFPS2002721325315238178Divyield142720313847EV234636237895255185206768209607211821EVSales292420141211EVEBITDA2361611601048876SourceCompanydataCMBIGMestimatesNoteThecalculationofnetcashincludesfinancialassetsPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE912Apr2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBISwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE10