SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS

Hong Kong

Initiating Coverage 15 April 2013

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Melco Int’l Development The Game Changer

Initiate with BUY and TP of HKD16.20. We initiate coverage on Melco International Development (MID) with a BUY recommendation and a target price of HKD16.20, based on SOTP valuation. We like MID’s portfolio of leisure and entertainment companies, which has given the holding company handsome rewards. Melco Crown (6883 HK, Not Rated), its 34%-owned key associate, is making strategic investments in areas offering long-term growth, namely, the rising Philippine gaming market (Belle Grande in 2014), Studio City (in 2015) and City of Dreams (Phase 3 development in 2016). We believe this pipeline of new growth initiatives between now and 2016 will continue to drive performance and consequently stock price.

Foray into Philippine gaming industry. Melco Crown has a 98.5% stake in Melco Crown Philippines Resorts (MCP, Not Rated) on the Philippine Stock Exchange. The backdoor listing allows it to raise capital through a primary equity offering of up to USD400m for up to 1.2b new shares. The price range set is expected to be between PHP11 to 14 per share (potential to raise USD265m to 337m before overallotment). In addition, the share accretion to Melco Crown from operations at Belle Grande alone through the 50:50 JV is estimated to be worth at least USD0.4/share (5% accretion) for Melco Crown. We expect Belle Grande to open in 1H14 with 967 hotel rooms, 242 tables and 1,451 slot machines.

Possible stake increase in Studio City. Studio City looks set to be the next casino to light up the Macau skyline when its construction is completed in 2H15. Its unique TV/film production theme will give it an edge in the race to attract the mass market audience. Melco Crown may increase its stake by 7% to 67% should its partner New Cotai Entertainment choose not to raise contributions. In our view, the market appears to have underpriced the upside to this development.

Dreams realised in Cotai. City of Dreams (CoD) has been Melco Crown’s main growth engine, benefiting from Cotai’s mass market growth and the spillover effects from newly opened properties in its vicinity. A shift in tables from Altira to CoD has led to improving yields. The addition of another 800 hotel rooms in its Phase 3 development programme in 2016 should also spur the organic growth in its flagship.

Melco International Development – Summary Earnings Table FYE Dec (HKDm) 2011A 2012A 2013F 2014F Revenue 129.3 146.9 154.2 161.9 EBITDA (68.7) (86.9) (85.9) (98.1) Recurring Net Profit 281.2 1,583.5 1,377.8 1,654.7 Recurring Basic EPS (HKD) 0.2 0.9 1.0 1.3 EPS Growth (%) 159.1 73.1 18.6 16.7 DPS (cents) 0.0 1.5 0.0 0.0

PER (x) 25.2 10.6 11.5 9.6 EV/EBITDA (x) n/m n/m n/m n/m Div Yield (%) 0.0 0.3 0.0 0.0 P/BV (x) 1.0 1.3 1.5 1.3

Net Gearing (%) 7.7 Net Cash Net Cash Net Cash ROE (%) 3.9 12.0 12.8 13.4 ROA (%) 3.3 11.3 11.3 12.0 Consensus Net Profit (HKDm) 1,502.0 2,078.0 Source: Company, Maybank KE estimates

Buy (New)

Share price: HKD13.42 Target price: HKD16.20 (new)

Jeremy TAN jeremytan@kimeng.com.hk (852) 2268 0635

Stock Information

Description: Melco International Development is an investment holding company focused on providing entertainment and property development services. The company operates in the following segments: leisure and entertainment as well as property and other investments. Ticker: 200 HK Shares Issued (m): 1,534 Market Cap (USDm): 2,644 3-mth Avg Daily Turnover (USDm): 13.3 HSI: 22,089 Free Float (%): 51.0 Major Shareholders: (%) Great Respect 19.49 Better Joy Overseas 18.81 Lasting Legend 7.53 Historical Chart

Performance: 52-week High/Low HKD13.96 / 5.12 1-mth 3-mth 6-mth 1-yr YTD Absolute (%) 9.7 21.4 95.3 76.0 48.5 Relative (%) 9.5 29.7 89.8 64.6 52.3

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PRICE PRICE REL. TO HANG SENG INDEX

Source: Bloomberg

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Melco International Development

Investment thesis Diversified growth catalysts. We like MID’s diversified portfolio of leisure and entertainment, not least because of its spectacular performance last year. For 2012, the company recorded a whopping 400% YoY surge in net profit to HKD1.1b and declared a dividend per share of HKD1.5 cents. We believe MID has taken strong stakes in strategic investments in its pursuit of long-term value. On top of its existing operations at Mocha Clubs, Altira and CoD via Melco Crown, it has identified Cotai as Macau’s next growth driver and is seeking to increase its stake in Studio City and capitalise on the third stage of development of CoD. Overseas expansion is also on the cards as it joins hands with SM Consortium to foray into the rapidly growing Philippine gaming market.

Figure 1: Melco Int’l Development – key holdings

Source: Company, Maybank KE

Macau gaming Mass market focus. Melco Crown benefits from being an early comer to Cotai with an integrated property, City of Dreams (CoD), which has already captured a wide mass market audience. It also runs Altira Macau, that mainly focus on the junket VIP business. Recent weakness in the VIP segment has forced the company to shift tables to CoD in order to maximise yield of the 625 tables. About 23 tables were shifted last year from Altira to CoD for this purpose. On the bright side, we estimate that Melco Crown has roughly one-third VIP exposure against two-thirds mass market exposure in terms of EBITDA. This enables it to ride the boom in Macau’s mass market segment – growth of 30% in the first three months alone outpaced VIP segment’s lacklustre growth of 10%.

Figure 2: Melco Crown – number of tables Figure 3: Melco Crown – average win per day per table (USD)

Source: Macau Gaming Inspection and Coordination Bureau (DICJ),

Maybank KE Source: DICJ, Maybank KE

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City of Dreams expansion. Melco Crown is embarking on Phase 3 of CoD’s development, which will expand the gross floor area to 1.5m sq ft and add another 800 hotel rooms. Although room revenues account for less than 3% of total revenue, more rooms will attract more tourists to stay and eventually spend at the gaming tables at its property. CoD is currently operating at 93% occupancy level. With the completion of a new premium mass gaming area near the Grand Hyatt lobby, it will also be shifting focus towards this segment where the minimum bet size is typically in excess of HKD2,000. We think raising the size of a bet could become a trend among the casinos in their bid to maximise table yields amid limited table supply.

Slot parlour impact immaterial. Mocha Clubs is Macau’s largest non-casino-based electronic gaming machine parlour and is located in an area where visitor footfall is dense. With 2,050 gaming machines, it draws in people who has time for just a quick game, especially the lower spending “grind” segment. The Macau government has taken steps to confine gaming within a 500m radius of a casino or in an existing commercial building. The casinos have one year until Nov 2013 to adopt the policy, and Melco Crown is expected to close at least a third of the clubs it owns. Only 600-700 of its slot machines will likely be affected and we do not think this will have a material impact on its total revenue nor our earnings model. After factoring in the potential impact of the regulation on slot parlours, we estimate Mocha Clubs’ contribution to Melco Crown’s earnings will amount to an immaterial USD0.1/share, based on 6x FY13F EBITDA.

Figure 4: Melco Crown – revenue mix (%) Figure 5: Melco Crown – EBITDA mix (%)

Source: Company, Maybank KE Source: Company, Maybank KE

Studio City expansion. Melco Crown plans to incorporate a television/film production theme into its newest casino development, Studio City. Furthermore, the resort’s strategic location adjacent to the Lotus Bridge checkpoint from Heng Qin will make it an instant attraction and help improve overall branding. In earlier reports, we have highlighted various large-scale tourism developments on Heng Qin, which we believe will create external economies of scale that will enhance the entire tourism landscape. The company plans to equip the property with 500 gaming tables, 1,500 electronic gaming machines and 1,600 hotel rooms. Melco Crown took over a 60% majority share of the project from eSun Holdings. It could raise its stake by 7% to 67% should its partner, New Cotai Entertainment LLC, choose not to increase contributions. Construction has resumed in 2012 and the new resort is expected to open in mid-2015. To date, the investment, which costs USD2.9b including pre-opening expenses, has been fully funded. As operator of the next casino to be completed in Macau, we believe Melco Crown’s position in Cotai will become further entrenched, especially since there will not be any new supply for the next two years.

City of Dreams

72%

Altira Macau 24%

Mocha Clubs 3%

Corporate and Others

1%

City of Dreams

81%

Altira Macau 15%

Mocha Clubs 4%

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Figure 6: Melco Crown – hotel and table inventory in Macau Casino Rooms Slots Tables Remarks City of Dreams 1400 1372 445 To add 800 rooms by 2016 Altira Macau 216 - 180 Mocha Clubs - 2050 - Studio City 1600 1500 500 Estimated Source: Company data, Maybank KE

Figure 7: Artist’s impression of Macao Studio City Figure 8: Construction of Macao Studio City

Source: Macau Business Source: Macau Business

Macau gaming market share

Steady despite competition. Melco Crown’s market share has held up relatively well in the past year at 13.2% despite intensifying competition in Cotai with the opening of two new casinos – Galaxy Macau in 2011 and Sands Cotai Central in 2012. Instead of losing market share, spillover effects from increased supply from neighbouring hotels helped improved footfall and financial performance at CoD. We forecast market share for Melco Crown to stay unchanged at 13% in both 2013 and 2014. Market share gains would become more distinct in 2015 when Studio City opens and new hotel rooms under CoD’s Phase 3 expansion come on-stream in 2016.

Figure 9: Melco Crown – monthly gross gaming revenue market share (%)

Source: DICJ, Maybank KE

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Figure 10: Sector gross gaming revenue market share forecasts (%)

Source: Company, Maybank KE

Foray into Philippine gaming

A burgeoning market. The Philippines’ gaming market is estimated to be potentially USD6b by 2017, according to industry-wide consensus, under the blue sky scenario. This would translate into growth at 40% CAGR over the next five years, even outstripping growth in the other regions. The gaming market could potentially rival in size with Singapore and Las Vegas. Overall, we are positive of the business climate in Philippines whose GDP grew at 6.6% YoY in 2012, and has its credit rating upgraded to investment grade by Fitch in March. We believe continual wage growth and improving consumer confidence to flourish the gaming industry, which has predominantly catered to the local community. The gaming tax rate also seems more conducive than that in Macau, Malaysia and Singapore. In the Philippines, gaming companies are not taxed at the bottom-line level. They pay 17% tax for VIP and 27% for mass market revenues compared with 39% tax against gross gaming revenue in other markets, thus translating into a better bottom line.

Figure 11: Philippine gaming market (USDm)

Source: PAGCOR, Company, Maybank KE

Build and they will come. New gaming supply is expected to come on-stream in the next four years at the Entertainment City in Manila Bay, Parañaque. As has happened in Macau and Singapore, this will spur gaming demand both domestically and from tourists regionally. There are currently 13 casinos operated by PAGCOR, Resorts World Manila which opened in 2009 and Solaire Manila in March 2013. Melco Crown’s positioning in the Philippines likely will be similar to

16.7% 15.6% 13.6% 14.9% 17.6% 17.3% 19.1% 20.4% 21.0% 22.5%

11.0% 12.9% 19.8% 20.5% 18.8% 21.2% 19.4% 18.1% 20.0% 21.0% 14.2% 14.7% 13.2% 13.2% 12.2% 11.8% 12.1% 10.8% 11.0% 10.0%

32.8% 31.2% 28.6% 27.2% 28.0% 27.4% 26.8% 27.6% 25.5% 24.5%

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MGM Melco Crown SJM Wynn Macau Galaxy Sands China

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CoD’s, which focuses on the premium mass market, and we believe this should help fill a missing niche in the local gaming market. We estimate that gross gaming revenue (GGR) accounted for 0.52% of the Philippine gross domestic product (GDP) in 2012, compared with 0.64% in Malaysia. But the GGR/GDP ratio should catch up with Malaysia’s, as a rising working population and wage growth will support the domestic market for gaming, not to mention tourism growth. According to CEIC, tourist arrivals to the Philippines reached only 4.3m in 2012, translating to 9% YoY growth. While growth outpaced Macau, this is a far cry from the more than 2m tourists Macau received on a monthly absolute basis. Nevertheless, we believe the Philippines has the potential to be a prime tourist destination, notwithstanding the negative perception of security in the country. And when gaming supply and other infrastructure are progressively added, tourism growth will be greatly enhanced.

Primary offering unlocks value. Melco Crown has a 98.5% stake in Manchester International Holdings (MIH), renamed Melco Crown Philippines Resorts (MCP, Not Rated), which will serve as the operational vehicle for its USD1b casino investment in the Philippines. The PHP1.26b acquisition opened up an opportunity for Melco Crown to raise up to USD400m cash from the market via new share issuance through MCP. The price range for the primary placement has been set at PHP11 to PHP14 per share (potential to raise USD265 to USD337 before overallotment). Against the implied enterprise value and our EBITDA forecast, the market is estimated to price the deal at around 12x to 14x EV/EBITDA. We believe the primary equity offering provides the catalyst to unlock the value in MCP. Bell Grande is the joint-venture casino between Belle (BEL, Not Rated) and Melco Crown. Belle, a company under the SM Consortium, is the owner of the land and buildings, while Melco Crown will be the operator of all the facilities within the resort complex. In total, Melco Crown’s contribution towards its Philippine investment is estimated at least USD600. We believe Melco Crown’s entry into the Philippine market will allow it to tap the growth potential of other emerging gaming markets in the region. Its partnership with the Philippines’ SM Consortium will also create synergistic value, with each party benefiting from the competitive advantage offered by the other.

Figure 12: Philippine gaming inventory Casino Developer Rooms Tables Slots Open date Resorts World Manila Travelers International 1200 300 1000 2H10 Solaire Manila Bloomberry 500 300 1200 1Q13 Belle Grande SM Consortium 967 242 1451 1H14 Manila Bay Casino Universal Entertainment 2050 500 3000 2015 Resorts World Bayshore Travelers International 1600 375 1500 2016 Source: Company data, Maybank KE

Figure 13: Artist’s impression of Solaire Figure 14: Artist’s impression of Belle Grande

Source: Solaire Resorts Source: SM Investments

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Earnings forecasts

Consistent growth. We forecast Melco Crown, MID’s key asset, will record EBITDA growth of 19.8% YoY for FY13F and 11.5% YoY for FY14F, translating into EBITDA of USD1.1b and USD1.2b for the respective years. We note that our FY13F/14F estimates are 9% higher than the consensus estimates. Consistent organic growth at CoD and contributions from Belle Grande when it opens in 2H14 will underpin the increase. Margin improvement from a change in gaming mix towards mass market will also become more evident in from 2013/14. As it stands, 1Q13 mass market to VIP ratio to mass market ratio for Melco Crown is 73%:27%.

Figure 15: Melco Crown – EBITDA and revenue (USDm)

Source: Company, Maybank KE

Blue sky Philippines. As mentioned earlier, it is estimated that the Philippine gaming market will grow at 40% CAGR in the next five years to reach USD6b. Under the blue sky scenario, we project Melco Crown will garner a 20% share of the market’s total gross gaming revenue through its joint-venture casino, Belle Grande. We further assign a 25% EBITDA margin to our projections to calculate the incremental EBITDA contributions from Belle Grande, which is a margin typical of a mass market styled casinos.

Figure 16: Melco Crown – share of Philippines’ gross gaming revenue (USDm)

Source: Company, Maybank KE

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Financial assumptions

Central to our financial assumptions is the fact that Melco Crown’s gaming concession will terminate on 26 Jun 2022 and its extension will be subject to government approval. We also assume no contributions from Studio City until its construction is completed in 1H15. On a quarterly basis, Melco Crown’s market share of Macau GGR has held steady at 13.2% on average between 1Q11 and 4Q12. We have assumed that its market share will stay stable at 13% for both 2013 and 2014.

VIP turnover growth and win rate. For 2013 and 2014, we assume VIP turnover growth of 5.0% as per the 2013 industry VIP GGR growth forecast. With respect to the VIP win rate, we assume the theoretical average of 2.85% (2009-2011 blended average: 2.8%).

Mass market drop growth and win rate. For 2013 and 2014 we assume mass market turnover growth of 30.0% at CoD and zero growth at Altira. With respect to the mass market win rate, we assume the theoretical average of 26.5% at CoD and 16% at Altira (2009-2011 blended average: 19.6%).

Slot machine handle turnover growth and win rate. For 2013 and 2014, we assume slot handle turnover growth of 5.0%. We also assume a slot machine win rate of 5.0%

Junket commission rate. Going forward, we assume an average junket commission rate of 1.25% of VIP turnover.

Tax rate. Melco Crown’s gaming tax is set at 39% of GGR (35% gaming tax, 1.6% contribution to a Macau public foundation and 2.4% contribution to the Macau government) for the entire duration of its gaming concession. The company is exempted from paying complimentary tax set at 12% of gaming pretax profit until 2015. The exemption is subject to further extension by the government.

Dividends. Melco Crown does not have a formal dividend policy nor does it provide guidance on dividend payout ratio. In view of the multiple investments in its pipeline until 2016, we do not think there will be any dividend payment in the medium term.

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Valuation

We use a sum-of-the-parts (SOTP) methodology to value MID, taking into consideration its key companies as well as identifiable assets under its wing. We value Entertainment Gaming Asia (EGT US), MelcoLot (8198 HK) and Mountain China Resorts (MCG CN) at the fair market value against the shareholding interest by MID. Together they account for 2.6% of MID’s total net asset value (NAV). Melco Crown (6883 HK), the key asset, accounts for 95.5% of MID’s NAV (see detailed valuation framework below). We have assigned a 30% discount to MID’s NAV estimate, which is at +1 standard deviation of its two-year historical range. We believe this is a better reflection of the company’s improved fundamentals. It is also worthy to note that the stub value of MID after removing its stake in Melco Crown is also at the two-year historical low. The stark negative stub value as shown in the figure below is an indication that the market is underpricing MID’s residual assets.

Figure 17: Melco International Development – sum-of-the-parts valuation Interest Value Value/share % NAV Ticker (%) (HKDm) (HKD) (%) Comment Melco Crown 6883 HK 34% 33,729 21.99 95.49% TP: HKD70.2 Entertainment Gaming EGT US 38% 174 0.11 0.56% Fair Value MelcoLot Ltd 8198 HK 51% 851 0.55 2.03% Fair Value Mountain China Resorts MCG CN 19% 9 0.01 0.03% Fair Value Add: Net cash/(debt) 241 0.16 0.68% FY12 Other Assets 429 0.28 1.21% FY12 Estimated NAV 35,434 23.10 100% Discount to NAV 30% 2 year +1sd Target Price 16.2 Rounded Source: Maybank KE estimates

Figure 18: Melco International Development – sensitivity analysis (valuation) Melco Crown (6883 HK) Target Price 60 65 70 75 80

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Source: Maybank KE estimates

Figure 19: Melco Int’l Development – stub value (HKD) Figure 20: Melco Int’l Development – discount to NAV

Source: Bloomberg, Maybank KE Source: Bloomberg, Maybank KE

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We value Melco Crown’s core business segments using the SOTP methodology as well. We apply EV/EBITDA as the main metric, given that it is a common valuation measure for industries characterised by continual and heavy capital expenditure, similar to the gaming industry of Macau in its growth stage. We have assigned an industry blended valuation of 12x FY13F EV/EBITDA for Melco Crown. We believe this is justified as the company becomes more focused on the mass market. We have assigned lower multiples for Altira Macau and Mocha Clubs in view of the overall slowdown in VIP growth and the location of these businesses on the Macau Peninsula. We value Altira Macau at 9x FY13F EV/EBITDA for its exposure to the junket business and Mocha Clubs at 6x FY13F EV/EBITDA for its slot machine parlour business. We believe that CoD, the flagship company, warrants 12x FY13F EV/EBITDA as it is heavily exposed to the Cotai mass market segment.

Studio City, should result in share accretion of USD1.5 as we assume a 20% ROIC against its USD2.9b investment discounted by a WACC of 12%. While for the Philippines investment, Belle Grande, we discount our earnings projection base on our 20% market share assumption and 25% EBITDA margin, for a price accretion of USD0.4/share. The 98.5% subsidiary Melco Crown Philippines Resorts, MCP PM, is trading at PHP 16.5 / share with a market cap of USD 1.36b on the Philippines stock exchange.

Figure 21: Melco Crown – sum-of-the-parts valuation EBITDA EV/EBITDA EV Value/sh (USD m) (x) (USD m) (USD) Comment City of Dreams 877.9 13.0 11,412.5 6.9 FY13 EBITDA Altira Macau 228.9 9.0 2,060.5 1.2 Mocha Clubs 37.1 6.0 222.3 0.1 Other expenses (41.1) 13.0 (534.9) (0.3) Macao Studio City 1.5 ROIC: 20% Belle Grande 0.4 WACC: 12% Total 1,102.7 11.9 13,160.4 9.9 Add: Net cash / (Debt) (1,258.8) (0.8) Minority Interest (27.0) (0.0) Equity Value (USD) 11,874.6 9.1 3 shares/ADR Target Price (HKD) 169.2 70.2 HKD7.7/USD Source: Maybank KE estimates

Figure 22: Studio City – price accretion estimate Studio City investment USD2.9 b Assumptions ROIC 20%, WACC 12%, Growth 0% EBITDA NPV USD1,348.4 m Price accretion USD4.6/share Source: Maybank KE estimates

Figure 23: Studio City – sensitivity analysis (value/share)

Return on invested capital (ROIC)

2 10.0% 15.0% 20.0% 25.0% 30.0%

WA

CC

8.0% 2.79 4.18 5.57 6.96 8.36 10.0% 2.54 3.81 5.08 6.35 7.62 12.0% 2.32 3.48 4.64 5.80 6.96 14.0% 2.13 3.19 4.26 5.32 6.39 16.0% 1.96 2.94 3.92 4.90 5.88

Source: Maybank KE estimates

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Appendix 1: Relative valuation

Figure 24: Consensus relative valuation comparison Name Ticker PER (x) EV/EBITDA (x) ROE (%) EBITDA growth (%) Macau FY13 FY 14 FY13 FY14 FY13 FY14 FY13 FY14 Galaxy Entertainment 27 HK 15.5 13.0 11.3 9.3 31.8 27.9 16.6 15.6 Melco Crown 6883 HK 23.9 19.3 13.0 11.7 13.3 15.8 17.0 10.1 Melco International Development 200 HK 14.1 10.2 13.1 17.2 MGM China 2282 HK 13.0 11.7 10.2 9.4 72.2 62.6 11.9 10.8 Sands China 1928 HK 20.9 17.0 16.4 13.7 32.7 35.6 42.2 18.1 SJM Holdings 880 HK 14.4 13.1 10.2 9.2 34.5 34.0 9.1 9.8 Wynn Macau 1128 HK 15.7 14.4 13.1 12.2 101.0 84.7 10.6 9.3 Regional Average 16.8 14.1 12.4 10.9 42.7 39.7 22.3 8.0 United States Caesars Entertainment Corp. CZR US 10.8 10.1 64.9 30.1 (3.0) 7.5 Las Vegas Sands Corp. LVS US 20.5 17.9 12.6 11.3 20.6 23.4 29.3 8.6 MGM Resorts International MGM US 10.3 9.6 (2.6) (0.4) 102.9 5.6 Wynn Resorts Ltd. WYNN US 21.1 19.1 10.4 10.2 318.5 (54.7) 14.8 3.4 Regional Average 20.8 18.5 11.0 10.3 100.3 (0.4) 36.0 6.3 ASEAN Alliance Global Group Inc. AGI PM 17.2 14.6 12.3 10.5 14.6 14.8 11.4 14.3 Belle Corp. BEL PM 90.6 29.3 52.7 16.2 5.1 10.7 238.4 208.6 Bloomberry Resorts Corporation BLOOM PM 38.8 17.8 24.7 13.8 18.9 33.1 905.9 71.2 Genting Bhd GENT MK 15.7 14.2 6.6 5.8 10.5 10.4 12.6 6.5 Genting Malaysia Bhd GENM MK 12.8 12.1 6.7 5.9 12.4 11.8 10.0 4.7 Genting Hong Kong Ltd. GENHK SP 15.7 11.6 22.7 19.2 15.4 19.3 31.9 11.5 Genting Singapore PLC GENS SP 23.2 20.0 11.8 10.3 9.4 9.7 13.8 8.9 NagaCorp Ltd. 3918 HK 11.9 10.1 9.1 7.4 27.7 27.7 20.3 19.9 Regional Average 28.2 16.2 18.3 11.1 14.2 17.2 155.5 43.2 Pacific Aristocrat Leisure Ltd. ALL AU 19.3 16.8 11.3 9.9 33.8 32.9 11.7 Crown Ltd. CWN AU 20.4 17.1 14.6 13.0 12.6 14.1 (2.6) 12.8 Echo Investment S.A. EGP AU 24.1 19.0 9.3 8.2 4.4 5.4 55.3 12.9 SkyCity Entertainment Group SKC NZ 17.9 16.0 9.7 9.1 16.8 17.6 5.2 8.1 TABCorp Holdings Ltd. TAH AU 17.7 17.0 7.7 7.2 9.4 9.6 (34.5) 4.1 Tatts Group Ltd. TTS AU 20.4 19.3 11.6 10.8 8.1 8.3 (21.5) 5.6 Regional Average 20.0 17.5 10.7 9.7 14.2 14.7 0.4 9.2 MSCI Index MSCI Asia ex Japan MXASJ 11.4 10.2 7.6 6.9 7.6 6.9 16.5 11.4 MSCI China MXCN 9.3 8.4 5.9 5.3 5.9 5.3 17.1 9.3 MSCI Hong Kong MXHK 15.5 14.0 15.1 13.5 15.1 13.5 12.4 15.5 MSCI Consumer Discretionary Index MSCI Asia ex Japan MXASJCD 10.4 9.1 7.3 6.6 7.3 6.6 10.0 10.4 MSCI China MXCN0CD 12.5 10.6 5.5 4.8 5.5 4.8 20.9 12.5 MSCI Hong Kong MXHK0CD 16.9 14.2 12.2 10.7 12.2 10.7 20.2 16.9 Source: Bloomberg, FactSet Updated: 14 Apr 2013

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Appendix 2: Company background

Founded in 1910 and listed on the Hong Kong Stock Exchange (HKEx) in 1927, Melco International Development is a holding company involved in the leisure and entertainment industry. Its portfolio includes companies such as Melco Crown Entertainment (6883 HK, MPEL US), Entertainment Gaming (EGT US) MelcoLot (8198 HK) and Mountain China Resorts (MCG CN) as well as a collection of private investments.

Melco Crown operates casino gaming and entertainment resort facilities that target the rapidly expanding gaming market in Macau. On 19 Dec 2006, it listed on the NASDAQ and successfully raised over USD1.14b in the process. The company is also dual-listed on the main board of the HKEx.

MelcoLot manages one of the largest lottery retail sales networks in China. Venue management aside, it is also involved in the distribution of scratch cards and lottery vending terminals in various provinces in China. With technical support from its strategic partner Firich, a worldwide leading point-of-sales system manufacturer listed in Taiwan, MelcoLot has a manufacturing base in Shanghai that produces highly versatile, cost-effective and reliable lottery vending terminals for the region. Its South Korean arm is a member of a consortium that operates the national welfare lottery under an exclusive licence from the South Korean government. The consortium comprises well-respected local corporations and INTRALOT, a leading supplier of integrated gaming and transaction processing systems

Entertainment Gaming Asia Inc. (EGT), a provider of gaming technology solutions, is listed on the NYSE American Stock Exchange. The company secures long-term contracts to provide comprehensive solutions for slot machine operations. It retains ownership of the gaming machines and systems and provides on-site maintenance. In return, it receives recurring daily fees based on an agreed upon percentage of the net gaming win per machine. EGT has established a strategic presence in the Asia Pacific with a focus on the Philippines and Cambodia. In May last year, it opened Dreamworld Casino in the Pailin Province of Cambodia. The casino’s strategic location at the Cambodian-Thai border on a growing trade route connecting the two countries will attract mass market and VIP premium players visiting from the surrounding areas.

Figure 25: Business Overview

Source: Company, Maybank KE

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Figure 26: Melco Crown – SWOT analysis Strengths Weaknesses

First mover on Studio City expansion Strong mass market presence on Cotai

Multiple concurrent investments High premium USD900m for Macau licence

Opportunities Threats

Philippine JV, Studio City Possible new gaming market opening Policy restrictions

GGR slowdown

Source: Maybank KE

Figure 27: Selected board members and management Mr. Lawrence Yau Lung Ho Mr. Ho was appointed the Group Managing Director of the company in Nov 2001 after he completed a general offer for the purchase of the shares of the company. He was appointed as Chairman and Chief Executive Officer on 15 Mar 2006. He is also the chairman of the executive, finance and regulatory compliance committees and a member of the corporate social responsibility committee of the company. Mr. Ho is currently the Co-Chairman and Chief Executive Officer of Melco Crown Entertainment Limited. Mr. Tsui Che Yin, Frank Mr. Tsui has been an Executive Director of the company since Nov 2001. He is also a member of the executive, finance, regulatory compliance and corporate social responsibility committees of the company. Mr. Tsui has more than 30 years of experience in investment and banking, having held senior management positions at various international financial institutions. He is currently a director of Mountain China Resorts (Holding) Limited, a company listed on the TSX Venture Exchange of Canada, an independent non-executive director of Hong Kong-listed Jinhui Holdings Company Limited and a non-executive director of Oslo-listed Jinhui Shipping and Transportation Limited. Prior to joining the group, Mr. Tsui was the President of China Assets Investment Management Limited, the investment manager of China Assets (Holdings) Limited, which is listed in Hong Kong. Mr. Chung Yuk Man, Clarence Mr. Chung has been an Executive Director of the company since May 2006. He is a member of the executive, finance and corporate social responsibility committees of the company. He is currently a non-executive director of Melco Crown Entertainment Limited. Mr. Chung has more than 20 years of experience in the financial industry in various capacities as chief financial officer, investment banker and merger and acquisition specialist. He was named one of the “Asian Gaming 50 – 2009 and 2010” by Inside Asian Gaming magazine. Source: Company

Figure 28: City of Dreams Figure 29: Altira Macau

Source: Company Source: Company

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Appendix 3: Macau macro statistics

Figure 30: Macau – annual gross gaming revenue (MOPm) Figure 31: Macau – monthly gross gaming revenue (MOPm)

Source: DICJ, Maybank KE Source: DICJ, Maybank KE

Figure 32: China – M1 and M2 growth vs gross gaming revenue growth (%)

Source: DICJ, Bloomberg, Maybank KE

Figure 33: Macau – visitor arrivals Figure 34: Macau – gross gaming revenue mix

Source: DSEC, Maybank KE Source: DSEC, Maybank KE

23.0

46.6

31.0

9.7

57.8

42.7

13.5 11.0 12.5

0

10

20

30

40

50

60

70

0

100,000

200,000

300,000

400,000

500,000

2005

2006

2007

2008

2009

2010

2011

2012

2013

F

2014

F

VIP Mass Slots GGR YoY (RHS)(%) (MOPm)

0%5%10%15%20%25%30%35%40%

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Jan

12

Feb

12

Mar

12

Apr

12

May

12

Jun

12

Jul 1

2

Aug

12

Sep

t 12

Oct

12

Nov

12

Dec

12

Jan

13

Feb

13

Mar

13

VIP rev (MOPm) Mass rev (MOPm)Slot rev (MOPm) YoY chg

-20

0

20

40

60

80

100

0

10

20

30

40

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12

China M1 growth YoY China M2 growth YoYGGR growth YoY 3 mths backward (RHS)

-30

-20

-10

0

10

20

30

40

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

Jan-

09

Apr

-09

Jul-0

9

Oct

-09

Jan-

10

Apr

-10

Jul-1

0

Oct

-10

Jan-

11

Apr

-11

Jul-1

1

Oct

-11

Jan-

12

Apr

-12

Jul-1

2

Oct

-12

Jan-

13

Visitors Visitor Growth YoY (RHS)

0%

20%

40%

60%

80%

100%

Jan

11

Jul 1

1

Jan

12

Jul 1

2

Jan

13Cotai / Taipa Peninsular

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Melco International Development

Appendix 4: Entertainment City Map

Figure 35: Entertainment City Map

Source: Google Map, Maybank KE

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Melco International Development

INCOME STATEMENT BALANCE SHEET FYE Dec (HKDm) 2011A 2012A 2013F 2014F

FYE Dec (HKDm) 2011A 2012A 2013F 2014F

Revenue 129 147 154 162 Fixed Assets 187 254 102 103

EBITDA (69) (87) (86) (98) Other LT Assets 7,635 8,845 10,417 12,277

Depreciation &Amortisation (6) (6) (7) (7) Cash/ST Investments 680 730 1,548 1,342

Operating Profit (EBIT) (63) (93) (93) (105) Other Current Assets 76 96 77 78

Interest (Exp)/Inc (123) (99) (123) (123) Total Assets 8,578 9,925 12,144 13,799

Associates 459 1,308 1,572 1,860

One-offs 4 0 0 0 ST Debt 228 34 34 34

Pre-Tax Profit 267 1,116 1,363 1,639 Other Current Liabilities 94 127 94 94

Tax 15 7 16 17 LT Debt 1,005 455 1,215 1,215

Minority Interest (1) (2) (1) (1) Other LT Liabilities 40 11 40 40

Net Profit 280 1,122 1,378 1,655 Minority Interest 29 -77 29 29

Recurring Net Profit 281 1,583 1,378 1,655 Shareholders' Equity 7,183 9,374 10,732 12,387

Total Liabilities-Capital 8,578 9,925 12,144 13,799

Revenue Growth % 3 14 5 5

EBITDA Growth (%) 27 26 (1) 14 Share Capital (m) 7,090 11,882 15,826 15,826

EBIT Growth (%) 39 47 0 13 Gross Debt/(Cash) 1,233 489 1,249 1,249

Net Profit Growth (%) 234 301 23 20 Net Debt/(Cash) 552 (240) (299) (92)

Recurring Net Profit Growth (%) (285) 463 (13) 20 Working Capital 434 664 1,498 1,292

Tax Rate % N/A N/A N/A N/A

CASH FLOW RATES & RATIOS

FYE Dec (HKDm) 2011A 2012F 2013F 2014F FYE Dec 2011A 2012A 2013F 2014F

Profit before taxation (1,450) (209) 280 1,122

EBITDA Margin % (53.1) (59.1) (55.7) (60.6)

Depreciation 15 10 6 (6) Op. Profit Margin % (48.7) (63.0) (60.1) (64.8)

Net interest receipts/(payments) 0 0 0 99 Net Profit Margin % 216.6 764.0 893.5 1,022.0

Working capital change (127) 17 (0) (6) ROE % 3.9 12.0 12.8 13.4

Cash tax paid 0 0 0 0 ROA % 3.3 11.3 11.3 12.0

Others (incl'd exceptional items) 1,421 155 (316) (1,128) Net Margin Ex. El % 216.6 857.1 893.5 1,022.0

Cash flow from operations (141) (27) (31) 81 Dividend Cover (x) N/A N/A N/A N/A

Capex (7) (1) (1) (1) Interest Cover (x) 2.3 11.3 11.2 13.5

Disposal/(purchase) 0 0 0 0 Asset Turnover (x) 1.5 1.5 1.3 1.2

Others 407 (34) 18 (72) Asset/Debt (x) 7.0 20.3 9.7 11.0

Cash flow from investing 400 (34) 17 (73) Debtors Turn (days) 9.9 163.6 9.9 9.9

Debt raised/(repaid) (96) 53 8 (28) Creditors Turn (days) 11.0 121.0 8.9 8.2

Equity raised/(repaid) 1 1 (24) 0 Inventory Turn (days) 9.3 6.4 9.3 9.3

Dividends (paid) (0) 0 (19) (20) Net Gearing % 7.7 Net Cash Net Cash Net Cash

Interest payments (250) (0) 0 99 Debt/ EBITDA (x) (18.0) (5.6) (14.5) (12.7)

Others 0 0 0 0 Debt/ Market Cap (x) 17.4 4.1 7.9 7.9

Cash flow from financing (345) 53 (35) 51

Change in cash (86) (8) (48) 59

PER SHARE DATA

FYE Dec (HKD) 2011A 2012A 2013F 2014F

EPS 0.2 0.9 1.0 1.3

CFPS n/m n/m n/m n/m BVPS 5.9 7.1 8.2 9.4

SPS 0.1 0.1 0.1 0.1

EBITDA/share n/m n/m n/m n/m DPS 0.0 0.0 0.0 0.0

Source: Company data, Maybank KE estimates

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RESEARCH OFFICES REGIONAL

P K BASU Regional Head, Research & Economics (65) 6432 1821 pk.basu@maybank-ke.com.sg

WONG Chew Hann, CA Acting Regional Head of Institutional Research (603) 2297 8686 wchewh@maybank-ib.com

ONG Seng Yeow Regional Products & Planning (65) 6432 1453 ongsengyeow@maybank-ke.com.sg

ECONOMICS Suhaimi ILIAS Chief Economist Singapore | Malaysia (603) 2297 8682 suhaimi_ilias@maybank-ib.com

Luz LORENZO Philippines | Indonesia (63) 2 849 8836 luz_lorenzo@maybank-atrke.com

Tim LEELAHAPHAN Thailand (662) 658 1420 tim.l@maybank-ke.co.th

MALAYSIA

WONG Chew Hann, CA Head of Research (603) 2297 8686 wchewh@maybank-ib.com Strategy Construction & Infrastructure Desmond CH’NG, ACA (603) 2297 8680 desmond.chng@maybank-ib.com Banking - Regional LIAW Thong Jung (603) 2297 8688 tjliaw@maybank-ib.com Oil & Gas Automotive Shipping ONG Chee Ting, CA (603) 2297 8678 ct.ong@maybank-ib.com Plantations- Regional Mohshin AZIZ (603) 2297 8692 mohshin.aziz@maybank-ib.com Aviation Petrochem YIN Shao Yang, CPA (603) 2297 8916 samuel.y@maybank-ib.com Gaming – Regional

Media TAN CHI WEI, CFA (603) 2297 8690 chiwei.t@maybank-ib.com Power Telcos WONG Wei Sum, CFA (603) 2297 8679 weisum@maybank-ib.com Property & REITs LEE Yen Ling (603) 2297 8691 lee.yl@maybank-ib.com Building Materials Manufacturing Technology

LEE Cheng Hooi Head of Retail chenghooi.lee@maybank-ib.com Technicals

HONG KONG / CHINA Todd MARTIN Head of Research (852) 2268 0638 toddmartin@kimeng.com.hk Banking & Finance Ivan CHEUNG, CFA (852) 2268 0634 ivancheung@kimeng.com.hk HK Property Industrial Jacqueline KO, CFA (852) 2268 0633 jacquelineko@kimeng.com.hk Consumer Andy POON (852) 2268 0645 andypoon@kimeng.com.hk Telecom & equipment Alex YEUNG (852) 2268 0636 alexyeung@kimeng.com.hk Industrial Warren LAU (852) 2268 0644 warrenlau@kimeng.com.hk Technology - Regional Karen KWAN (852) 2268 0640 karenkwan@kimeng.com.hk China Property Jeremy TAN (852) 2268 0635 jeremytan@kimeng.com.hk Gaming

INDIA Jigar SHAH Head of Research (91) 22 6623 2601 jigar@maybank-ke.co.in Oil & Gas Automobile Cement Anubhav GUPTA (91) 22 6623 2605 anubhav@maybank-ke.co.in Metal & Mining Capital goods Property Urmil SHAH (91) 22 6623 2606 urmil@maybank-ke.co.in Technology Media Varun VARMA (91) 226623 2611 varun@maybank-ke.co.in Banking

SINGAPORE Gregory YAP Head of Research (65) 6432 1450 gyap@maybank-ke.com.sg Technology & Manufacturing Telcos - Regional Wilson LIEW (65) 6432 1454 wilsonliew@maybank-ke.com.sg Hotel & Resort Property & Construction James KOH (65) 6432 1431 jameskoh@maybank-ke.com.sg Logistics Resources Consumer Small & Mid Caps YEAK Chee Keong, CFA (65) 6432 1460 yeakcheekeong@maybank-ke.com.sg Offshore & Marine Alison FOK (65) 6432 1447 alisonfok@maybank-ke.com.sg Services S-chips Bernard CHIN (65) 6432 1446 bernardchin@maybank-ke.com.sg Transport (Land, Shipping & Aviation) ONG Kian Lin (65) 6432 1470 ongkianlin@maybank-ke.com.sg REITs / Property Wei Bin (65) 6432 1455 weibin@maybank-ke.com.sg S-chips Small & Mid Caps

INDONESIA Katarina SETIAWAN Head of Research (62) 21 2557 1125 katarina.setiawan@maybank-ke.co.id Consumer Strategy Telcos Lucky ARIESANDI, CFA (62) 21 2557 1127 lucky.ariesandi@maybank-ke.co.id Base metals Mining Oil & Gas Wholesale Rahmi MARINA (62) 21 2557 1128 rahmi.marina@maybank-ke.co.id Banking Multifinance Pandu ANUGRAH (62) 21 2557 1137 pandu.anugrah@maybank-ke.co.id Automotive Heavy equipment Plantation Toll road Adi N. WICAKSONO (62) 21 2557 1128 adi.wicaksono@maybank-ke.co.id Generalist Anthony YUNUS (62) 21 2557 1139 anthony.yunus@maybank-ke.co.id Cement Infrastructure Property Arwani PRANADJAYA (62) 21 2557 1129 arwani.pranadjaya@maybank-ke.co.id Technicals

PHILIPPINES Luz LORENZO Head of Research (63) 2 849 8836 luz_lorenzo@maybank-atrke.com Strategy Laura DY-LIACCO (63) 2 849 8840 laura_dyliacco@maybank-atrke.com Utilities Conglomerates Telcos Lovell SARREAL (63) 2 849 8841 lovell_sarreal@maybank-atrke.com Consumer Media Cement Kenneth NERECINA (63) 2 849 8839 kenneth_nerecina@maybank-atrke.com Conglomerates Property Ports/ Logistics Katherine TAN (63) 2 849 8843 kat_tan@maybank-atrke.com Banks Construction Ramon ADVIENTO (63) 2 849 8845 ramon_adviento@maybank-atrke.com Mining

THAILAND Sukit UDOMSIRIKUL Head of Research (66) 2658 6300 ext 5090 Sukit.u@maybank-ke.co.th

Maria LAPIZ Head of Institutional Research Dir (66) 2257 0250 | (66) 2658 6300 ext 1399 Maria.L@maybank-ke.co.th Consumer/ Big Caps

Andrew STOTZ Strategist (66) 2658 6300 ext 5091 Andrew@maybank-ke.co.th

Mayuree CHOWVIKRAN (66) 2658 6300 ext 1440 mayuree.c@maybank-ke.co.th Strategy

Suttatip PEERASUB (66) 2658 6300 ext 1430 suttatip.p@maybank-ke.co.th Media Commerce Sutthichai KUMWORACHAI (66) 2658 6300 ext 1400 sutthichai.k@maybank-ke.co.th Energy Petrochem Termporn TANTIVIVAT (66) 2658 6300 ext 1520 termporn.t@maybank-ke.co.th Property Woraphon WIROONSRI (66) 2658 6300 ext 1560 woraphon.w@maybank-ke.co.th Banking & Finance Jaroonpan WATTANAWONG (66) 2658 6300 ext 1404 jaroonpan.w@maybank-ke.co.th Transportation Small cap. Chatchai JINDARAT (66) 2658 6300 ext 1401 chatchai.j@maybank-ke.co.th Electronics Pongrat RATANATAVANANANDA (66) 2658 6300 ext 1398 pongrat.R@maybank-ke.co.th Services/ Small Caps

VIETNAM Michael KOKALARI, CFA Head of Research (84) 838 38 66 47 michael.kokalari@maybank-kimeng.com.vn Strategy Nguyen Thi Ngan Tuyen (84) 844 55 58 88 x 8081 tuyen.nguyen@maybank-kimeng.com.vn Food and Beverage Oil and Gas Ngo Bich Van (84) 844 55 58 88 x 8084 van.ngo@maybank-kimeng.com.vn Banking Trinh Thi Ngoc Diep (84) 844 55 58 88 x 8242 diep.trinh@maybank-kimeng.com.vn Technology Utilities Construction Dang Thi Kim Thoa (84) 844 55 58 88 x 8083 thoa.dang@maybank-kimeng.com.vn Consumer Nguyen Trung Hoa +84 844 55 58 88 x 8088 hoa.nguyen@maybank-kimeng.com.vn Steel Sugar Resources

15 April 2013 Page 18 of 20

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Melco International Development

APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLAIMERS AND DISCLOSURES DISCLAIMERS This research report is prepared for general circulation and for information purposes only and under no circumstances should it be considered or intended as an offer to sell or a solicitation of an offer to buy the securities referred to herein. Investors should note that values of such securities, if any, may fluctuate and that each security’s price or value may rise or fall. Opinions or recommendations contained herein are in form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from the relevant jurisdiction’s stock exchange in the equity analysis. Accordingly, investors’ returns may be less than the original sum invested. Past performance is not necessarily a guide to future performance. This report is not intended to provide personal investment advice and does not take into account the specific investment objectives, the financial situation and the particular needs of persons who may receive or read this report. Investors should therefore seek financial, legal and other advice regarding the appropriateness of investing in any securities or the investment strategies discussed or recommended in this report. The information contained herein has been obtained from sources believed to be reliable but such sources have not been independently verified by Maybank Investment Bank Berhad, its subsidiary and affiliates (collectively, “MKE”) and consequently no representation is made as to the accuracy or completeness of this report by MKE and it should not be relied upon as such. Accordingly, MKE and its officers, directors, associates, connected parties and/or employees (collectively, “Representatives”) shall not be liable for any direct, indirect or consequential losses or damages that may arise from the use or reliance of this report. Any information, opinions or recommendations contained herein are subject to change at any time, without prior notice. This report may contain forward looking statements which are often but not always identified by the use of words such as “anticipate”, “believe”, “estimate”, “intend”, “plan”, “expect”, “forecast”, “predict” and “project” and statements that an event or result “may”, “will”, “can”, “should”, “could” or “might” occur or be achieved and other similar expressions. Such forward looking statements are based on assumptions made and information currently available to us and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those expressed in any forward looking statements. Readers are cautioned not to place undue relevance on these forward-looking statements. MKE expressly disclaims any obligation to update or revise any such forward looking statements to reflect new information, events or circumstances after the date of this publication or to reflect the occurrence of unanticipated events. MKE and its officers, directors and employees, including persons involved in the preparation or issuance of this report, may, to the extent permitted by law, from time to time participate or invest in financing transactions with the issuer(s) of the securities mentioned in this report, perform services for or solicit business from such issuers, and/or have a position or holding, or other material interest, or effect transactions, in such securities or options thereon, or other investments related thereto. In addition, it may make markets in the securities mentioned in the material presented in this report. MKE may, to the extent permitted by law, act upon or use the information presented herein, or the research or analysis on which they are based, before the material is published. One or more directors, officers and/or employees of MKE may be a director of the issuers of the securities mentioned in this report. This report is prepared for the use of MKE’s clients and may not be reproduced, altered in any way, transmitted to, copied or distributed to any other party in whole or in part in any form or manner without the prior express written consent of MKE and MKE and its Representatives accepts no liability whatsoever for the actions of third parties in this respect. This report is not directed to or intended for distribution to or use by any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. This report is for distribution only under such circumstances as may be permitted by applicable law. The securities described herein may not be eligible for sale in all jurisdictions or to certain categories of investors. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply based on geographical location of the person or entity receiving this report. Malaysia Opinions or recommendations contained herein are in the form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from Bursa Malaysia Securities Berhad in the equity analysis. Singapore

This report has been produced as of the date hereof and the information herein may be subject to change. Maybank Kim Eng Research Pte. Ltd. (“Maybank KERPL”) in Singapore has no obligation to update such information for any recipient. For distribution in Singapore, recipients of this report are to contact Maybank KERPL in Singapore in respect of any matters arising from, or in connection with, this report. If the recipient of this report is not an accredited investor, expert investor or institutional investor (as defined under Section 4A of the Singapore Securities and Futures Act), Maybank KERPL shall be legally liable for the contents of this report, with such liability being limited to the extent (if any) as permitted by law. Thailand The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the Office of the Securities and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand and the market for Alternative Investment disclosed to the public and able to be accessed by a general public investor. The result, therefore, is from the perspective of a third party. It is not an evaluation of operation and is not based on inside information. The survey result is as of the date appearing in the Corporate Governance Report of Thai Listed Companies. As a result, the survey may be changed after that date. Maybank Kim Eng Securities (Thailand) Public Company Limited (“MBKET”) does not confirm nor certify the accuracy of such survey result. Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of MBKET. MBKET accepts no liability whatsoever for the actions of third parties in this respect. US

This research report prepared by MKE is distributed in the United States (“US”) to Major US Institutional Investors (as defined in Rule 15a-6 under the Securities Exchange Act of 1934, as amended) only by Maybank Kim Eng Securities USA Inc (“Maybank KESUSA”), a broker-dealer registered in the US (registered under Section 15 of the Securities Exchange Act of 1934, as amended). All responsibility for the distribution of this report by Maybank KESUSA in the US shall be borne by Maybank KESUSA. All resulting transactions by a US person or entity should be effected through a registered broker-dealer in the US. This report is not directed at you if MKE is prohibited or restricted by any legislation or regulation in any jurisdiction from making it available to you. You should satisfy yourself before reading it that Maybank KESUSA is permitted to provide research material concerning investments to you under relevant legislation and regulations. UK This document is being distributed by Maybank Kim Eng Securities (London) Ltd (“Maybank KESL”) which is authorized and regulated, by the Financial Services Authority and is for Informational Purposes only. This document is not intended for distribution to anyone defined as a Retail Client under the Financial Services and Markets Act 2000 within the UK. Any inclusion of a third party link is for the recipients convenience only, and that the firm does not take any responsibility for its comments or accuracy, and that access to such links is at the individuals own risk. Nothing in this report should be considered as constituting legal, accounting or tax advice, and that for accurate guidance recipients should consult with their own independent tax advisers.

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DISCLOSURES Legal Entities Disclosures Malaysia: This report is issued and distributed in Malaysia by Maybank Investment Bank Berhad (15938-H) which is a Participating Organization of Bursa Malaysia Berhad and a holder of Capital Markets and Services License issued by the Securities Commission in Malaysia. Singapore: This material is issued and distributed in Singapore by Maybank KERPL (Co. Reg No 197201256N) which is regulated by the Monetary Authority of Singapore. Indonesia: PT Kim Eng Securities (“PTKES”) (Reg. No. KEP-251/PM/1992) is a member of the Indonesia Stock Exchange and is regulated by the BAPEPAM LK. Thailand: MBKET (Reg. No.0107545000314) is a member of the Stock Exchange of Thailand and is regulated by the Ministry of Finance and the Securities and Exchange Commission. Philippines: Maybank ATRKES (Reg. No.01-2004-00019) is a member of the Philippines Stock Exchange and is regulated by the Securities and Exchange Commission. Vietnam: Maybank Kim Eng Securities JSC (License Number: 71/UBCK-GP) is licensed under the State Securities Commission of Vietnam. Hong Kong: KESHK (Central Entity No AAD284) is regulated by the Securities and Futures Commission. India: Kim Eng Securities India Private Limited (“KESI”) is a participant of the National Stock Exchange of India Limited (Reg No: INF/INB 231452435) and the Bombay Stock Exchange (Reg. No. INF/INB 011452431) and is regulated by Securities and Exchange Board of India. KESI is also registered with SEBI as Category 1 Merchant Banker (Reg. No. INM 000011708) US: Maybank KESUSA is a member of/ and is authorized and regulated by the FINRA – Broker ID 27861. UK: Maybank KESL (Reg No 2377538) is authorized and regulated by the Financial Services Authority.

Disclosure of Interest Malaysia: MKE and its Representatives may from time to time have positions or be materially interested in the securities referred to herein and may further act as market maker or may have assumed an underwriting commitment or deal with such securities and may also perform or seek to perform investment banking services, advisory and other services for or relating to those companies. Singapore: As of 15 April 2013, Maybank KERPL and the covering analyst do not have any interest in any companies recommended in this research report. Thailand: MBKET may have a business relationship with or may possibly be an issuer of derivative warrants on the securities /companies mentioned in the research report. Therefore, Investors should exercise their own judgment before making any investment decisions. MBKET, its associates, directors, connected parties and/or employees may from time to time have interests and/or underwriting commitments in the securities mentioned in this report. Hong Kong: KESHK may have financial interests in relation to an issuer or a new listing applicant referred to as defined by the requirements under Paragraph 16.5(a) of the Hong Kong Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission. As of 15 April 2013, KESHK and the authoring analyst do not have any interest in any companies recommended in this research report. MKE may have, within the last three years, served as manager or co-manager of a public offering of securities for, or currently may make a primary market in issues of, any or all of the entities mentioned in this report or may be providing, or have provided within the previous 12 months, significant advice or investment services in relation to the investment concerned or a related investment and may receive compensation for the services provided from the companies covered in this report.

OTHERS Analyst Certification of Independence The views expressed in this research report accurately reflect the analyst’s personal views about any and all of the subject securities or issuers; and no part of the research analyst’s compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in the report.

Reminder Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to sophisticated investors who are capable of understanding and assuming the risks involved. The market value of any structured security may be affected by changes in economic, financial and political factors (including, but not limited to, spot and forward interest and exchange rates), time to maturity, market conditions and volatility and the credit quality of any issuer or reference issuer. Any investor interested in purchasing a structured product should conduct its own analysis of the product and consult with its own professional advisers as to the risks involved in making such a purchase.

No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior consent of MKE. Definition of Ratings Maybank Kim Eng Research uses the following rating system: BUY Return is expected to be above 10% in the next 12 months (excluding dividends) HOLD Return is expected to be between - 10% to +10% in the next 12 months (excluding dividends) SELL Return is expected to be below -10% in the next 12 months (excluding dividends)

Applicability of Ratings The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies.

Some common terms abbreviated in this report (where they appear): Adex = Advertising Expenditure FCF = Free Cashflow PE = Price Earnings

BV = Book Value FV = Fair Value PEG = PE Ratio To Growth

CAGR = Compounded Annual Growth Rate FY = Financial Year PER = PE Ratio

Capex = Capital Expenditure FYE = Financial Year End QoQ = Quarter-On-Quarter

CY = Calendar Year MoM = Month-On-Month ROA = Return On Asset

DCF = Discounted Cashflow NAV = Net Asset Value ROE = Return On Equity

DPS = Dividend Per Share

NTA = Net Tangible Asset ROSF = Return On Shareholders’ Funds

EBIT = Earnings Before Interest And Tax P = Price WACC = Weighted Average Cost Of Capital

EBITDA = EBIT, Depreciation And Amortisation P.A. = Per Annum YoY = Year-On-Year

EPS = Earnings Per Share PAT = Profit After Tax YTD = Year-To-Date

EV = Enterprise Value PBT = Profit Before Tax

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Malaysia

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Singapore

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London

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New York

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Stockbroking Business: Level 8, Tower C, Dataran Maybank, No.1, Jalan Maarof 59000 Kuala Lumpur Tel: (603) 2297 8888 Fax: (603) 2282 5136

Hong Kong

Kim Eng Securities (HK) Ltd Level 30, Three Pacific Place, 1 Queen’s Road East, Hong Kong Tel: (852) 2268 0800 Fax: (852) 2877 0104

Indonesia

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Tel: (62) 21 2557 1188 Fax: (62) 21 2557 1189

India

Kim Eng Securities India Pvt Ltd 2nd Floor, The International 16, Maharishi Karve Road, Churchgate Station, Mumbai City - 400 020, India Tel: (91).22.6623.2600 Fax: (91).22.6623.2604

Philippines

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Thailand

Maybank Kim Eng Securities (Thailand) Public Company Limited 999/9 The Offices at Central World, 20th - 21st Floor, Rama 1 Road Pathumwan, Bangkok 10330, Thailand Tel: (66) 2 658 6817 (sales) Tel: (66) 2 658 6801 (research)

Vietnam

In association with

Maybank Kim Eng Securities JSC 1st Floor, 255 Tran Hung Dao St. District 1 Ho Chi Minh City, Vietnam Tel : (84) 844 555 888 Fax : (84) 838 38 66 39

Saudi Arabia

In association with

Anfaal Capital Villa 47, Tujjar Jeddah Prince Mohammed bin Abdulaziz Street P.O. Box 126575 Jeddah 21352 Tel: (966) 2 6068686 Fax: (966) 26068787

South Asia Sales Trading

Kevin FOY kevinfoy@maybank-ke.com.sg Tel: (65) 6336-5157 US Toll Free: 1-866-406-7447

North Asia Sales Trading

Eddie LAU eddielau@kimeng.com.hk Tel: (852) 2268 0800 US Toll Free: 1 866 598 2267

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