IRAN’S CAPITAL MARKETS

THE FUTURE IS BRIGHT DECEMBER 2017

ASSET MANAGEMENT AND PRIVATE EQUITY

WHAT WE DO

2

GRIFFON CAPITAL OVERVIEW

3

Griffon Capital is an Asset Management and Private Equity group focused solely on the Iranian

market

Founded and managed by a unique

mix of shareholders and senior

management on-the-ground in

Iran. The team has extensive

experience in the Iranian market

and has worked many years for top

tier global financial institutions.

Our team is further strengthened

by a team of world class senior

advisors who ensure that we align

ourselves with best international

practices

Backed by a group of strategic

shareholders, which include

European and Middle Eastern

family offices and international

investment companies with

extensive frontier market

experience.

These shareholders significantly

increase the reach of our network

and our ability to seed various

investment vehicles and products

offered by our business units.

Our Asset Management and

Corporate Finance Advisory

platforms are fully licensed and

regulated by the Securities and

Exchange Organization (SEO) of Iran.

We develop extensive in-house

research covering over 16 sectors.

Our Corporate Finance team has a

successful track record of completing

transactions for leading international

clients.

Local / International Team Strategic Shareholders Licensed and Regulated

What do we do

What sets us apart?

One of Griffon’s key differentiating

factors is our competency to cover

the whole spectrum of public and

private equity markets.

Aside from being able to provide a

broader array of products to our

investors, leveraging sector

information from the public market

as well as Private Equity insight,

provides our team with a 360‘ view

of the opportunities.

Public and Private Equity

THREE COMPLEMENTARY BUSINESS LINES

4

Asset Management Cross-border M&APrivate Equity

‒ Mergers & Acquisitions advisory

‒ Executed largest recent landmark cross

border M&A deals in Iran

‒ Focused on creating synergies with

Griffon’s PE fund

‒ Integrated an existing advisory firm in

2014 – ABIC

‒ an experienced team with over 13

years of local experience

‒ Strong deal track record

‒ Only team in Iran led by senior

investment bankers from top

international investment banks

‒ Unique understanding of the local

market

‒ Ongoing strategic dialogue with key

players in the market

‒ Offering bespoke portfolio management services that satisfy a broad mix of investor requirements

‒ April 2016 launch- The GIF Fund SP-open ended fund investing in listed equities

‒ Investment philosophy and strategy based on fundamental, bottom up, proprietary research

‒ Strong team on-the-ground- 50 years combined (domestic & international)investment management experience coupled with analysts’ proprietary research covering 15 sectors

‒ Structure to allow institutional access

‒ Transparent and regulated structure

‒ Robust sanctions compliance framework structured by Herbert Smith Freehills London

‒ Cayman CIMA registered Fund with Fully licensed and regulated Domestic Manager

‒ Institutional standard risk framework and corporate governance

‒ First Private Equity fund and Club Deal

platform for the Iranian market

‒ Focused on the consumer sector

‒ Unique team on the ground

‒ Unparalleled access to proprietary

pipeline of deals

‒ 320+ companies met, 64 soft due

diligence

‒ Building on strength of corporate

finance team

‒ Unique position in the consumer

and tech ecosystems

‒ Deep and extensive local network

‒ Focus on value enhancement

‒ International level governance

‒ Reporting and auditing

‒ Operational efficiency

‒ Clear path to exit

1 2 3

WHY IRAN?

5

IRAN: THE FASTEST GROWING, LARGEST AND CHEAPEST ‘FRONTIER MARKET’

6

Source: MSCI, TSE

Source: MSCI, TSE

The highest dividend yield (hist.)

The largest by Market Capitalisation

The cheapest by P/E (hist.) ratio

The largest number of listed equity securities

Source: Stock exchanges, TSE

Source: MSCI, TSE

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

USD

bn

438

383

342 335

299

195 190172

150 124

83 73 67 45

6.5x 6.6x

8.4x 8.8x

10.7x 11.2x 11.8x13.2x 13.5x

15.5x 15.8x 15.8x

19.9x21.2x 10.6%

6.7% 6.5%

4.9%4.5% 4.2%

3.7% 3.7% 3.4%

2.5% 2.4% 2.2% 2.1%

1.1%

WHY IRAN? FIRST MOVERS ARE ALREADY HERE..

7

What makes Iran attractive

• Very low valuations compared to othermarkets in the region and peers.

• Economy grew 13% last Iranian fiscal year.The stock market was up 29% despitepolitical tensions. In its Iran focusedreport, McKinsey referred to Iran as thenext trillion dollar opportunity.

• Large- PPP basis the economy is largerthan Australia and with a largedemographic dividend – 80m population,60% under 35.

• Diversified economy: largest exporter ofcement, 9th largest auto manufacturer,4th largest in oil reserves, 2nd largest gasreserves, 9th in copper, 1st in Zinc and avibrant Tech startup scene.

• Surprisingly well developed: welldeveloped with: 101% mobilepenetration, 73% banking & ATM cardpenetration, 54 airports, two stockexchanges with over 400 actively tradedcompanies.

Other multinationals already have

• You are in good company - committed FDIin 2016 according to IMF was $12 bn.

• Many multinationals and their products arealready present in Iran.

• Coke, Pepsi, Nestle, Danone, Henkel are toname a few.

• Henkel recently purchased a plant for €153million.

• Boeing recently signed a contact to sell$3bn of planes to Aseman.

Strategic location

• Direct beneficiary of OBOR (One Belt oneRoad)- Hugely strategic transit route, SilkRoad economics stand 2,200 years later.

• Regional population cluster ~300m people -Warm water access for landlockedcountries

DIVERSIFIED AND GROWING ECONOMY

8

Source: CBI, World Bank

Oil accounts for only about 12% of the GDPLowest external debt in the region

Source: The Mobile World

High banking and mobile penetration Developed infrastructure

54Commercial airports

215,157 kmRoads

10,407 kmRailway

15Ports

Source: CBI

101%

63%

Mobilepenetration rate

(Iran)

Mobilepenetration rate

(Global)

92%87%

61% 57%

Account at a formalfinancial

instutation(%age15+)

Account at a formalfinancial

female(%age15+)

Iran Global

718

646

370 390330

404

165 1768 67

110

627

94119

16

Turkey KSA UAE Iran Egypt

GDP, Current Prices External Debt International Reserves

Industry, 12%

Construction, 5%

Social & private

services, 14%

Hotel and Restaurant Business,

13%Agriculture,

13%Utilities, 5%

Financial services, 3%

Transportation &

communication, 10%

Real estate and

professional services, 15%

Oil & gas, 12%

Other mining, 1%

DEMOGRAPHIC DIVIDEND: LARGE, EDUCATED, COST COMPETITIVE POPULATION

9

Source: IMF, WEO Oct. 2015, Central Intelligence Agency, World fact book, Est 2015

0

50

100

150

200

250

300

350

400

450

500

Russia US Iran Japan S. Korea

Tho

usa

nd

s

Source: World Economic Forum/UNESCO. Rank our of 124 countries excludes China, India.

Country $USD/month

Australia 1810

USA 1257

Saudi Arabia 800

Korea 1124

Turkey 839

Brazil 386

Russian Federation 274

Iran 247

Iran’s minimum wage - 2015

80 million population growing at 1.24%

3rd highest no. of engineering graduates - 2015

0ver $17k GDP per capita (PPP)

70% of all engineering and science students are female

26.0

15.617.3

14.3

6.2

20.4

0.00

5.00

10.00

15.00

20.00

25.00

30.00

Russia Brazil Iran China India Turkey

Tho

usa

nd

s

Source: IMF, 2015

71% Between

15-64

2.3%

1.9%

2.3%2.2%

1.1%

-0.3%

0.2%

0.7%

1.2%

1.7%

2.2%

2.7%

0

10

20

30

40

50

60

70

80

90

100

Egypt Iran KSA Turkey UAE

Mill

ion

s

above 64 15-64 0-14 Urbanization rate

91 79 31 78 9

Source: OECD

SOME OF THE MULTINATIONALS CONSUMER BRANDS CURRENTLY PRESENT IN IRAN

10

LOW HANGING FRUIT- GROWING FROM A LOW BASE

11

ECONOMY GROWING FAST OFF A VERY LOW BASE

12

Source: IMF, World bank

Source: IMF

GDP composition growth: 2016 v H1 2017

Real GDP growth accelerating

GDP growth constant prices (2016)

Diversified economy (Oil only ~12% of the GDP)

Source: CBI

Industry, 12%

Construction, 5%

Social & private

services, 14%

Hotel and Restaurant Business,

13%

Agriculture, 13%

Utilities, 5%

Financial services, 3%

Transportation &

communication, 10%

Real estate and

professional services, 15%

Oil & gas, 12%

Other mining, 1%

Source: SCI

3%

29%

-6%

4%

18%

-14%

1%

7%2%

15%

4%9% 10%

5%

12% 11%

2016 2017 H1

0.3% 0.3%

6%

3%

-8%

-0.3%

3%

-2%

13%

4% 4%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017E 2018E

13%

6% 6%5% 4%

3% 3% 3% 2%1%

-2%-2%

EARNINGS- ‘THE ONLY WAY IS UP’

13

Industry-level earnings growth Corporate earnings bottomed and now growing

Source: Codal.ir

The earnings upgrade cycle has just started

• All figures are based on a sample of 338 listed companies

2016/2015(hist.) 2017/2016(hist.) 2018/2017(e.)

EPS Growth -28.8% 23.2% 11.3%

114

30

194177

29

132

187

30

121

Upgrades unchanged Downgrades

# o

f co

mp

anie

s

2016/2015(hist.) 2017/2016(hist.) 2018/2017(e.)

2017/2016(hist.) 2018/2017(e.) EPS CAGR 2yr(e.)

Base metals 2434.2% 88.6% 591.3%

Motor vehicles 813.2% -48.7% 116.4%

Refineries 140.8% -7.2% 49.5%

Metal products -11.4% 123.4% 40.7%

Metallic ore 55.4% 21.5% 37.4%

Leasing 22.1% 27.6% 24.8%

Investment companies 13.1% 24.9% 18.9%

IT & computers 22.9% 10.7% 16.6%

Telecommunication 13.1% 8.8% 10.9%

Communication )Other( 17.9% 4.4% 10.9%

Rubber & tyre 73.8% -33.5% 7.5%

Utility 5.6% 8.5% 7.0%

Insurance companies -11.6% 28.9% 6.8%

Pharmaceuticals 10.5% -2.3% 3.9%

Chemicals -9.8% 6.5% -2.0%

Foods excl. sugar -11.0% 3.1% -4.2%

Cements, limes & plasters

-44.9% 60.2% -6.0%

Transportation & storage

-10.0% -5.5% -7.7%

Engineering -7.7% -15.7% -11.8%

Banking -44.1% 34.1% -13.4%

Conglomerates -9.6% -23.9% -17.0%

GROWTH DRIVERS AND THE UPSIDE

14

MARKET GROWTH DRIVERS

15

Source: World bank*Estimate from Ministry of Economy and Finance

Source: European Union, Eurostat

FDI started & foreign portfolio inflow to follow

Real interest rates falling Iran-EU trade doubles

Source: CBI, TSE

2.3 2.0 2.03.0

3.64.3 4.7

3.02.1 2.1

11.8

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016*

USD

bn

0

2

4

6

8

10

12

14

16

18

20

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1

EUR

bn

Exports Imports

China trade resumes growth

30.3

27.5

14.8

14.8 24.316.4

0

5

10

15

20

25

30

35

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17E

USD

bn

Export Import

7.2

8.8

6.5

9.2

2016-H1 2017-H1

25.7%27.0%

25.5%24.0% 24.0% 23.8% 23.3%

22.1%

18.5%16.6%

8.6% 8.7% 9.0% 9.4% 9.8% 10.2% 10.3% 10.0% 9.9% 9.8%

17.2%18.3%

16.5%14.6% 14.2% 13.7% 12.9% 12.1%

8.6%

6.8%

Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17

Average T-bill YTM Inflation Real interest rate

VALUATION DISCOUNT IS TOO LARGE: BASE CASE OF ~30% CAGR FOR NEXT FIVE YEARS

16Proprietary and Confidential

Source: MSCI, TSE, Bloomberg

TEDPIX P/E ratio- historical range

Lowest PE ratio & highest dividend yield

PE ratio(hist.) Dividend Yield

Expected returns scenario 2018 2019 2020 2021 2022

EPS Growth 10% 13% 16% 18% 20%

Dividend yield 8.3% 6.9% 5.7% 4.7% 4.5%

P/E ratio 7.2x 8.0x 8.7x 9.5x 10.0x

Total (local) Return 36% 36% 35% 36% 32%

USD/IRR depreciation 6% 6% 6% 6% 6%

USD Return 28% 28% 27% 29% 25%

5 yr. expected CAGR 27% - the ‘double kicker’

Country Start date Year 1 Year 3 Year 5

Turkey (XU 100) Mar 13, 2001 25% 32% 39%

Russia (RTS) Sep 04, 1995 85% -14% 19%

Vietnam (VN index) Jun 30, 2000 316% 13% 19%

Prague (IPX) Sep 07, 1993 116% 20% 10%

Pakistan (KSE 100 ) Dec 18, 1992 62% 6% 7%

Shanghai (SHSEC) May 08, 1992 165% 7% 25%

New markets tend to perform well – CAGR guidance

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Jan

-10

Ap

r-10

Jul-

10

Oct

-10

Jan

-11

Ap

r-11

Jul-

11

Oct

-11

Jan

-12

Ap

r-12

Jul-

12

Oct

-12

Jan

-13

Ap

r-13

Jul-

13

Oct

-13

Jan

-14

Ap

r-14

Jul-

14

Oct

-14

Jan

-15

Ap

r-15

Jul-

15

Oct

-15

Jan

-16

Ap

r-16

Jul-

16

Oct

-16

Jan

-17

Ap

r-17

Jul-

17

Oct

-17

6.5

19.4

15.8 15.5

2016

10.6%

2.4% 2.4% 2.2%

2016

Iran

World Avg.

EM Avg.

FM Avg.

THE GIF FUND SP

17

SERVICE PROVIDERS, STRUCTURE AND TERMS

18

Lawyers & sanctions: Herbert Smith Freehills LLPCayman Legal Counsel: Walkers LLPAuditor: Grant Thornton (Cayman)Administrator: Circle Partners (Netherlands)Bank paying agent: Reyl & Cie GeneveCustodian: Central Securities Depositary of Iran (CSDI)

The Fund: GIF Fund SP - a Cayman open ended Fund (SPC)The Investment Manager: Griffon Asset Management (Cayman)Sub Advisor: Modababran Homa, fully licensed asset management firm, regulated by

the Securities Exchange Organization of Iran (SEO)ISIN KYG3864W1015Denomination: EuroShare Class: Class A

Management Fee: 2%Performance Fee: 20%Minimum Subscription: Eur100,000Lock up: 6 monthsHurdle: 5%HWM: YesLiquidity Subscriptions: MonthlyLiquidity Redemptions: Monthly (90 day notice)

STOCK MARKET - RECENT PERFORMANCE

TEDPIX

Farabourse

800

840

880

920

960

1000

1040

1080

Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17

75000

78000

81000

84000

87000

90000

93000

96000

Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17

89,501

61,164

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000

65,000

70,000

75,000

80,000

85,000

90,000

95,000

•Govt increase in feed stock and raw material prices

•Contractionary monetary policy

•Concerns about negotiations• Period of consolidation post JCPOA led sentiment & liquidity rally

•High real interest rates

•Banking sector challenges

•Slower than anticipated engagement of large international banks with Iran

TEDPIX – THE MAIN INDEX - BREAKS ABOVE ITS ALL-TIME HIGH

20

-32%

JCPOA Implementation Day

• Real interest rates fall significantly

•Higher commodity prices & export led growth

•Strong corporate earnings 208%

•Significant increase in liquidity

•Undervalued privatizations

•Devaluation of the currency and weight of exporters in the index

95,601

21

COMPARATIVE GROSS PERFORMANCE (GAV)

850

950

1,050

1,150

1,250

1,350

Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17

GIF RIAL GIF USD GIF EURO TEDPIX RIAL (rebased)

STRESS TESTING AND RISKS

22

-100

-50

0

50

100

150

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

Inflation, average consumer prices GDP growth Oil revenue

STRESS TESTED: RESILIENT ECONOMY DESPITE WAR AND SANCTIONS

23

1979 U.S. bans Iranian imports

1995 U.S. bans energy investment, trading in Iran. Sanctions foreign firms investing in Iranian energy sector

2006 U.N. freezes assets of those linked with nuclear program

Mar 07 U.N. imposes arms, financial sanctions, extends asset freeze Oct 07 U.S. sanctions Banks Melli, Bank Mellatand Bank Saderat

Mar 08 U.N. imposes travel and financial curbs, trade ban

Jan 11 U.S. announces new unilateral sanction on IranNov 11 Wester states step up sanctions on Iran in response to a report suggesting it had worked on designing an atomic bomb

Jan 14 JPOA outline agreed between Iran 5+1. Iran EU lifts sanctions on petrochemicals, Auto and gold. Iran receives $700 million every month from blocked oil sales proceeds.

80 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

War

US Sanctions

UN Sanctions

EU Sanctions

1980 – 1988 almost 200,000 killed or MIA

Estimated economic loss of US$550 - 650 billion

Oil Production level dropped from 7 million bpd to almost 1 million bpd as fields were targeted by Iraq.

(%) (%) (bn USD)

16

Jan 16 JCPOA Implementation day on January 2016

CURRENCY- LOWER INFLATION & MORE CURRENCY STABILITY

24

• The average annual depreciation of the Iranian rial versus the US dollar, over the last 3 years, has been ~ 6.5%/year.

• Current US/IR CPI differential is around 7-8%. With increase in oil and export revenues since the Nuclear deal was struck, the

risk of devaluation has significantly diminished. Nevertheless, despite the recent stability its prudent to consider a gradual

depreciation in line with the CPI differential.

-20%

0%

20%

40%

60%

80%

100%

19

78

19

79

19

80

19

81

19

82

19

83

19

84

19

85

19

86

19

87

19

88

19

89

19

90

19

91

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

Q3

FX change (free market rate) Inflation differential (Iran & US)

WHAT ABOUT SANCTIONS?

25

• Vast majority of sanctions removed (EU, UN & US secondary)

• Risk is now to a large extent eliminated, especially for non-US persons

• US persons for the most part fall outside the scope of the JCPOA

• A number of sanctions remain (namely nuclear and human rights related)

• According to IAEA Iran is in compliance with the agreement (JCPOA). Certain steps taken by Iran to comply are irreversible. In the unlikely event that sanctions return, the flow of funds will become restricted as many of the banks that currently deal with Iran will likely halt/reduce their operations.

• The agreement is between Iran and 5+1 meaning Germany, UK, Russia, France, US and China. A series of none compliance reports/warnings and voting would need to take place for sanctions to return. It will not be an overnight event and there will be ample opportunity to unwind liquid positions.

• As for PE and VC its important to note that even during sanctions many large foreign owned multinationals continued to operate in Iran in the consumer sector. Sectors related to food and medicine were never targeted by sanctions.

DISCLAIMER

26

“IMPORTANT: This presentation (the “Presentation”) has been prepared by Griffon Capital exclusively for the benefit of the recipient to whom it isaddressed, which shall in particular not include any US or any other persons subject to the remaining sanctions laws or authorities (the “Recipient”).The Recipient (i) is not permitted to reproduce in whole or in part the information provided in this Presentation (the “Information”) or tocommunicate the Information to any third party without Griffon Capital’s prior written consent; and (ii) is to keep permanently confidential allInformation that is not already public.

This Presentation (i) is for discussion purposes only; (ii) is not intended as an invitation, offer or solicitation for making an investment in anyjurisdiction; and (ii) speaks only as of the date it is given, reflecting prevailing market conditions. The views expressed are subject to change basedupon a number of factors, including market conditions. Neither the delivery of this Presentation at any time nor any future investments shall underany circumstances create an implication that the Information is correct as of any time after such date.

Neither Griffon Capital nor any of its affiliates, subsidiaries, employees, members, advisors, representatives or agents (collectively,"Representatives") have made or make any representation or warranty as to the accuracy or completeness of the Information and theRepresentatives shall have no liability for any misstatement or omission of fact or any opinion expressed herein.

The Presentation is not exhaustive and does not serve as legal, business, accounting, tax or any other advice, and it may not be relied upon by theRecipient in evaluating the merits of investing in the suggested jurisdictions. Nothing herein shall be taken as constituting the giving of investmentadvice and this Presentation is not intended to provide, and must not be taken as, the basis of any decision and should not be considered as arecommendation by Griffon Capital. The Recipient must make its own independent assessment and such investigations as it deems necessary suchas consulting business, legal and tax advisors. Only these business, legal and tax advisors will be able to appropriately take into account thecircumstances relevant to the legal implications and/or tax treatment of each investor. It is the responsibility of the investors to satisfy themselvesthat any investments made will not expose them to liability under the laws of any state to which they are or may become subject.

Under no circumstances is Griffon Capital or any of its Representatives acting or deemed to be acting as the agent representative or fiduciary of theRecipient.

Griffon Capital, together with a group of international legal sanctions experts, have integrated a robust compliance procedure to adhere to theremaining US and EU sanctions against Iran, and related international regulations.

The Recipient of this Presentation, acknowledges and agrees that neither Griffon Capital nor its Representatives shall have (a) any duty to provideaccess to any additional information or to update or correct any information or (b) any liability to the Recipient or its Representative resulting fromthe use of such Information.

DECEMBER 2017

101, No 38, Golfam Alley, Africa Blvd, Tehran, IranTel: +98 21 26231278 www.griffoncapital.com

ASSET MANAGEMENT AND PRIVATE EQUITY