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1

Key Market Indices (5 March 2013) Key Statistics

Value Change % Change % YTD SET Value by investor Type: Daily SET 1549.31 8.59 0.6% 11.3% Buy (THBm) Sell (THBm) Net (THBm)

SET50 1018.94 4.74 0.5% 7.8% Institution 4,206.77 4,184.37 22.41 SET100 2283.92 10.89 0.5% 9.9% Proprietary 6,142.53 4,999.52 1,143.01 Foreign 11,677.54 12,097.45 -419.91 Dow Jones 14253.77 125.95 0.9% 8.8% Retail 37,167.52 37,913.02 -745.50 S&P500 1539.79 14.59 1.0% 8.0%

Nasdaq 3224.13 42.10 1.3% 6.8% SET Value by investor Type

FTSE 6431.95 86.32 1.4% 9.1% MTD (THBm) YTD (THBm) FSSTI 3248.26 8.31 0.3% 2.6% Institution 146.99 19,978.97

Hang Seng 22560.50 22.69 0.1% -0.4% Proprietary 650.54 -1,896.74 Nikkei 11839.13 90.52 0.8% 13.8% Foreign 3,092.02 741.97 KLCI 1642.08 6.10 0.4% -2.8% Retail -3,889.55 -18,824.2 SHANGHAI SE

2326.31 52.90 2.3% 2.5% JCI 4751.70 -9.76 -0.2% 10.1% SET50 Index Future Long Short Net MTD YTD

SET 5-yr avg 2011 2012F

Institution 3,949 4,160 -211 167 6,169

PE (x) 14.4 17.8 14.3 Foreign 2,842 1,637 1,205 3,156 -8,743

P/BV(x) 1.9 2.5 2.3 Local 9,704 10,698 -994 -3,323 2,574

Yield(%) 4.0 2.6 3.2

MARKET DATELINE

THAILAND EQUITY

Investment Research

Morning Matters

WHAT’S INSIDE

On the Platter

Samart (SAMART TB; FV THB30.00 – BUY) Company Update: 2013 To

Be a Golden Year

SAMART’s share price has surged by 39% since our upgrade last month. It

stands to benefit from huge ICT investments as state telcos upgrade their

existing networks. The potential upside for the group, comprising SAMART,

SAMTEL and SIM, lies in favorable news such as winning more ICT projects. As

the stock is now trading at a cheap valuation, we strongly recommend a BUY,

with a new THB30 TP based on 17.7x FY13 PER, on further upside from its call

centre business’ listing later this year.

MEDIA HIGHLIGHTS Sansiri targets luxury market with Narasiri

TRUE to offer 4-year debentures totaling Bt7.8 bn

BOT eases rule on single lending cap

JV to launch eight residential projects

THAI reaches out to AirAsia

Central, ICC join Japan’s Sumitomo in joint venture

Grass Roots Innovators

Nok Board okays Q3 IPO, Yangon route

ECONOMIC HIGHLIGHTS Malaysia: Malaysia Plans to Cut Reliance on Overseas Workers, Mustapa Says

Australia: Australia’s Economy Expanded 0.6% Last Quarter, Led by Exports

EU: EU Opens Way for Easier Budgets After Austerity Backlash

UK: U.K. Services Growth Accelerates as Demand Strengthens

US: U.S. Tells G-7 to Avoid Currency Intervention Except Rare Cases

US: Service Industries in U.S. Grow at Fastest Pace in a Year

06 Mar 2013

SET Intraday Chart

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MEDIA HIGHLIGHTS

Sansiri targets luxury market with Narasiri

Amid high competition in the mid-tier market, Sansiri plans to launch luxury detached housing under the new Narasiri brand with prices above Bt20 million per unit to boost overall revenue to Bt36 billion this year. The luxury brand will make up some of the 21 low-rise projects worth Bt25.22 billion in total that will be launched over the course of the year. Including high-rise projects, Sansiri will launch 45 new residential projects worth Bt61 billion this year. (The Nation)

TRUE to offer 4-year debentures totaling Bt7.8 bn

The company is offering a fixed interest rate of 5.8 per cent per annum and will pay interest every three months until maturity. The debentures are priced at Bt1,000 per unit with a minimum subscription of Bt100,000. They can be subscribed through Bangkok Bank, Krungthai Bank, Kasikornbank, Siam Commercial Bank and Asia Plus Securities. The subscription period runs from April 1-4. (The Nation)

BOT eases rule on single lending cap

The Bank of Thailand will temporarily relax the single lending limit rule to companies under a group to more than 25 per cent of the lender's Tier 1 capital base, according to a report by the central bank. The current rule prohibits banks from lending more than 25 per cent of their Tier 1 capital to a single client. According to the report, the BOT wants the rule to be eased in line with the demand for lending of large companies, while the activities of conglomerates can help strengthen the local economy. (The Nation)

JV to launch eight residential projects

Krungthep Land, a joint venture between Property Perfect and Singapore-based Fraser and Neave (F&N), plans to launch eight new residential projects worth Bt11.8 billion to boost its total revenue to Bt5.3 billion this year, up 130 per cent over last year's total revenue of Bt2.3 billion.More than 60 per cent of its total revenue target, or Bt4.1 billion, will be from low-rise residences, both detached houses and townhouses, nd Bt1.2 billion from its condominium project, The Pano. (The Nation)

THAI reaches out to AirAsia

Thai Airways International (THAI) is experiencing an attitudinal U-turn as it seeks to foster an unprecedented friendship with long-time arch rival AirAsia. Sorajak Kasemsuvan, president of the country's flag carrier, personally made the overture during a recent meeting in Bangkok with Tony Fernandes, the chief executive of Asia's largest and fastest-growing budget carrier group. It was the first meeting of any kind between the leaders of the two feuding carriers, which over the past decade have publicly made known their intention of trumping each other in the fiercely competitive airline industry. (Bangkok Post)

Central, ICC join Japan’s Sumitomo in joint venture

The Japanese Sumitomo Corporation has joined Central Department Store Co and the Saha Group subsidiary ICC International Plc to explore business opportunities in the 10-billion-baht TV shopping business in Thailand. A joint venture called Shop Global (Thailand) Co has been set up with registered capital of 600 million baht, with Sumitomo holding 40%. The rest is held by Central Department Store (30%) and ICC International (30%). Shigeru Ohashi, president and chief executive of Shop Global (Thailand), said Sumitomo has 15 years in the TV shopping business and is keen to branch out overseas this year. (Bangkok Post)

Grass Roots Innovators

Giant companies that used to be pioneers of innovation are being accused of a lack of creativity and new ideas. On the other hand, the trend is for commercial innovation to move across enterprise boundaries, so ideas and designs often come from the masses. However, a push from big industry players is urgently needed to connect this unparalleled grass-roots creativity to the market. (Bangkok Post)

Nok Board okays Q3 IPO, Yangon route

Nok Air's board has approved its initial public offering (IPO) and the resumption of its international services.The endorsement last Friday set into motion the budget airline's IPO scheme, involving the divestiture of up to a 30% stake to raise 3 billion baht to fund its growth plan, chiefly for aircraft. Its financial adviser, Siam Commercial Bank, is preparing a listing application for submission to the Securities and Exchange Commission. The IPO will most likely take place in August, said Patee Sarasin, Nok Air's chief executive. (Bangkok Post)

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ECONOMICS HIGHLIGHTS

Malaysia: Malaysia Plans to Cut Reliance on Overseas Workers, Mustapa Says

Malaysia plans to reduce its reliance on foreign workers by phasing out labor-intensive industries and monitoring investments closely. The government wants a “manageable” number of overseas workers, Mustapa Mohamed, Malaysia’s trade and industry minister, told reporters in Singapore today. “We are moving up the value chain,” Mustapa said. “Malaysia is not a place for purely labor-intensive industries,” he said, adding that while the nation will continue to need foreign workers in plantations, restaurants and as domestic helpers, it will be “more selective” in evaluating investment proposals from companies. (Bloomberg)

Australia: Australia’s Economy Expanded 0.6% Last Quarter, Led by Exports

Australia’s economy expanded last quarter, driven by household consumption and exports, and a surge in public spending. Fourth-quarter gross domestic product advanced 0.6 percent from the previous three months, when it rose a revised 0.7 percent that was higher than initially reported, a Bureau of Statistics report released in Sydney today showed. The result compared with the median of 28 estimates in a Bloomberg News survey for a 0.6 percent gain. The data validate Reserve Bank of Australia Governor Glenn Stevens’s decision to hold rates yesterday after six reductions totaling 1.75 percentage points from November 2011 to December 2012 to help buttress the economy. Policy makers are trying to stimulate industries outside mining, where investment is expected to plateau this year. (Bloomberg)

EU: EU Opens Way for Easier Budgets After Austerity Backlash

European finance ministers opened the way for looser budget policies after a backlash against austerity thrust Italy into political limbo and shattered months of relative stability in European markets. Italy’s deadlocked election, France’s refusal to make deeper budget cuts and protests against the shrinking of the welfare state across southern Europe escalated the rebellion against the German-led prescription for fighting the debt crisis. Economic strains “may also justify in a certain number of cases reviewing deadlines for the correction of excessive deficits,” European Union Economic and Monetary Commissioner Olli Rehn told reporters late yesterday after a meeting of euro- area finance ministers in Brussels. (Bloomberg)

UK: U.K. Services Growth Accelerates as Demand Strengthens

U.K. services unexpectedly accelerated last month as demand strengthened, indicating the economy may stave off a recession this quarter. A gauge of activity increased to 51.8 from 51.5 in January, Markit Economics and the Chartered Institute of Purchasing and Supply said today in London. The pound rose after the survey. A separate report showed that euro-area services shrank less than initially estimated last month. Bank of England policy makers begin their monthly meeting tomorrow after they split on the need to expand quantitative easing in February. While a slump in a manufacturing gauge last week raised concerns the economy may succumb to a triple-dip recession, Markit said its indexes now point to 0.1 percent expansion this quarter. (Bloomberg)

US: U.S. Tells G-7 to Avoid Currency Intervention Except Rare Cases

The U.S. Treasury Department’s top international official urged Group of Seven economies to avoid targeting exchange rates and let markets set currency levels, calling for full and timely data on the scale of nations’ interventions. “The G-7 pledged that exchange rates should float freely, except in rare circumstances where excess volatility or disorderly movements might warrant cooperation,” Lael Brainard, the undersecretary for international affairs, said at a conference in Washington today. “In addition, the G-7 members committed to avoid targeting exchange rates and to orient domestic monetary and fiscal policy toward meeting domestic objectives, using only domestic instruments.” (Bloomberg)

US: Service Industries in U.S. Grow at Fastest Pace in a Year

Service industries in the U.S. expanded in February at the fastest pace in a year as a recovery in housing rippled through the economy. The Institute for Supply Management’s non-manufacturing index unexpectedly increased to 56 last month from 55.2 in January, the Tempe, Arizona-based group said today. Readings above 50 signal expansion in the industries comprising 90 percent of the economy. The median Bloomberg forecast called for the measure to ease to 55. (Bloomberg)

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4

Outperform

Current Target Upside/

Recc. Price Price Downside PE (x) Yield

(%) Remarks

(Bt) (Bt) (%) 2013f 2013f

CK

Trading Buy 26.75 43.30 61.9 44.8 2.3

MBK Buy 160.00 267.00 66.9 6.7 4.4

SAMART Buy 22.40 22.00 -1.8 13.3 5.3 To Be a Golden Year

LOXLEY Buy 6.55 10.10 54.2 15.6 1.9 ITD Buy 7.10 9.65 35.9 62.8 0.2

AIT Buy 78.50 110.00 40.1 10.5 7.1 KK Buy 63.00 79.00 25.4 10.5 5.3 MINT Buy 25.50 32.50 27.5 24.8 1.1 KTB Buy 27.00 32.80 21.5 9.1 3.1 BLAND Buy 2.16 2.56 18.5 144.4 0.0 BTS Buy 8.50 9.33 9.8 48.8 2.5

Underperform

Current Target Upside/

Recc. Price Price Downside PE (x) Yield

(%) Remarks

(Bt) (Bt) (%) 2013f 2013f

CPF Sell 32.50 28.00 -13.8 26.5 1.7 TISCO Sell 54.25 48.00 -11.5 10.6 4.7 CPALL Neutral 47.75 48.50 1.6 32.2 2.3 PSL Neutral 16.20 12.83 -20.8 11.5 3.4 PTTEP Neutral 153.50 157.00 2.3 8.6 3.9 TTA Sell 16.00 13.60 -15.0 137.6 1.6 SPALI Sell 21.80 15.50 -28.9 11.5 3.5

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5

DIARY OF EVENTS

7-May 8-May 9-May 10-May 11-May

US Data

Arial 7pt.

MY Data

MY Results

Second Chance Properties

SIA Engineering

OSIM International

US Data

MY Data

MY Results

US Data

MBA Mortage Applications (May 4)

MY Data

Automobile COE Open Bid

Cat A (May 9) Automobile COE Open Bid

Cat B (May 9)

Automobile COE Open Bid

Cat C (May 9)

MY Results

Singapore Airlines Ltd

ASL Marine Holdings

Ellipsiz Ltd Sembcorp Marine

United Overseas Bank

US Data

Initial Jobless Claims (May 5)

Continuing Claims (Apr

28)

MY Data

MY Results

Wilmar International City Developments

Hiap Hoe

Singapore

Telecommunications

Vicom Ltd

US Data

MY Data

MY Results

Sembcorp Industries

Mewah International

14-May 15-May 16-May 17-May 18-May

US Data

MY Data

MY Results

SATS Ltd

ComfortDelgro Corp

US Data

MY Data

Retail Sales Ex Auto (YoY)

(Mar)

Retail Sales (YoY) (Mar) Retail Sales (MoM) sa

(Mar)

MY Results

Fragrance Group

Global Premium Hotels

First Resources Ltd

Armstrong Industrial Olam International

US Data

MBA Mortage Applications

(May 11)

MY Data

MY Results

US Data

Initial Jobless Claims (May

12) Continuing Claims (May 5)

MY Data

MY Results

US Data

MY Data

MY Results

Tiger Airways

21-May 22-May 23-May 24-May 25-May

US Data

MY Data

MY Results

US Data

Existing Home Sales (Apr)

Existing Home Sales MoM

(Apr)

MY Data

MY Results

Avago Technologies Ltd

US Data

MBA Mortage Applications

(May 18)

New Home Sales (Apr)

New Home Sales MoM (Apr)

MY Data

Automobile COR Open Bid

Cat A (May 23)

Automobile COR Open Bid

Cat B (May 23)

Automobile COR Open Bid Cat C (May 23)

MY Results

US Data

Initial Jobless Claims (May

12)

Continuing Claims (May 5)

MY Data

Initial Jobless Claims (May

19)

Continuing Claims

(May12)

MY Results

Global Logistics Properties

Ltd

US Data

MY Data

MY Results

5 4 1 28 27 5 4 1 28 27

1 SCC 180.0 17.6 -35.3 -234.3 -24.5 KBANK -242.5 297.9 589.5 254.1 13.7 INTUCH 904.2 PTT -487.5 INTUCH 17,644.5 LH -4,252.7

2 TCAP 164.6 204.3 70.7 38.0 84.0 SCB -151.0 139.7 118.8 69.6 -314.0 KBANK 644.9 LH -275.1 PTT 5,725.8 SCC -2,679.4

3 INTUCH 158.9 -9.7 755.1 154.9 129.9 CK -129.7 40.9 62.6 106.7 25.5 TCAP 439.6 CPN -180.4 KBANK 4,879.2 BANPU -1,499.5

4 PTT 121.6 -314.1 -295.0 26.4 -142.0 CPN -118.6 -30.0 -31.9 20.6 9.0 KTB 340.1 TRC -157.7 BBL 4,413.3 SIRI -1,291.6

5 BBL 118.0 -2.2 37.3 -91.1 -68.4 AMATA -101.2 -77.0 28.1 -42.2 -77.7 BIGC 225.6 AMATA -150.0 ADVANC 4,345.5 MINT -907.7

6 TUF 94.9 53.9 56.5 16.8 4.5 ADVANC -77.6 -15.5 88.2 241.6 -50.9 TUF 205.3 DTAC -93.8 PTTEP 4,292.5 HMPRO -392.7

7 BGH 83.7 62.8 -22.2 49.1 -56.3 DEMCO -49.1 5.2 9.8 1.7 -10.4 SCC 162.3 TRUE -86.3 DTAC 3,515.4 TTCL -352.2

8 PTTGC 82.3 -98.1 131.1 375.6 -119.6 JAS -46.5 32.7 74.8 -98.3 36.2 BBL 153.1 MDX -60.9 BAY 3,155.2 STPI -314.8

9 TISCO 80.1 22.4 16.1 18.1 32.5 TRC -46.2 -19.8 -91.8 0.2 0.0 BGH 124.3 TMB -55.6 PTTGC 2,574.3 UV -271.1

10 CPALL 74.7 -78.2 12.5 9.6 44.9 CENTEL -38.9 2.9 5.4 22.7 3.8 SPCG 122.7 PTTEP -55.1 KTB 2,487.3 STEC -246.7

11 KTB 74.4 89.6 176.1 53.9 19.5 THAI -35.4 81.2 1.8 5.9 24.0 TISCO 118.5 GLOW -48.0 TOP 2,175.4 RML -202.1

12 BIGC 70.0 55.9 99.8 64.0 32.2 TRUE -30.5 -48.4 -7.4 24.4 -9.4 PTTGC 115.3 IVL -44.9 TCAP 2,066.5 SCB -165.0

13 ITD 59.4 -10.4 2.9 0.8 10.5 TOP -19.1 35.3 56.5 34.3 -18.1 SIRI 110.7 BEC -42.0 BIGC 1,798.3 QH -155.8

14 TICON 41.3 19.5 -0.3 -0.5 44.9 SF -16.8 -13.5 -1.1 -9.6 13.1 HEMRAJ 109.8 QH -40.4 TMB 1,746.2 DEMCO -142.7

15 BTS 40.6 3.8 34.4 51.4 124.4 SMIT -16.6 -1.6 -2.5 -18.6 -1.4 SCB 107.5 ROBINS -40.2 BGH 1,732.4 MINT-W4 -142.4

16 SPALI 36.2 0.5 4.4 105.5 131.4 SGP -16.3 0.1 0.3 11.6 19.0 DELTA 98.9 TCB -39.8 TUF 1,634.3 SITHAI -131.8

17 TTW 32.2 24.2 4.4 -25.2 17.7 LH -15.2 -43.2 -216.7 -43.4 120.8 BTS 78.8 CPF -34.7 CPALL 1,411.4 WHA -124.8

18 N-PARK 30.3 3.2 -1.0 0.8 2.3 GUNKUL -15.1 -4.0 0.3 8.0 8.0 TOP 72.7 DEMCO -34.1 SPALI 1,406.9 SF -121.3

19 HEMRAJ 30.1 43.1 36.6 2.5 10.9 MK -12.1 0.1 -4.6 -7.3 -2.6 ANAN 72.7 BEAUTY -32.6 AP 1,108.3 MDX -118.3

20 MINT 27.0 -13.6 -29.8 -19.8 -22.7 GOLD -10.6 -6.5 -0.6 2.3 -12.2 VGI 71.5 SF -31.5 AOT 1,100.1 TRC -115.0

% % of % of

Turn. paidup paidup

1 N-PARK 7.98 1 TISCO-P 66.16 65.86

2 TRUE 4.15 2 BBL 31.15 29.99

3 JAS 7.78 3 KBANK 29.28 28.50

4 LH 27.19 4 TWFP 22.36 24.77

5 BTS 3.22 5 LPN 21.81 21.73

6 HEMRAJ 24.62 6 SPALI 21.15 17.94

7 ITD 1.71 7 L&E-W2 20.75 7.77

8 QH 2.29 8 SIRI-W1 18.78 11.05

9 BLAND 0.84 9 THRE 17.99 15.50

10 ANAN 11.89 10 LH 17.26 21.18

11 KTB 13.85 11 AP 16.44 12.92

12 NMG 8.46 12 LRH 15.34 15.73

13 BBL 67.83 13 BAY 15.23 13.89

14 BAY 22.10 14 TCAP 15.21 12.60

15 CK 5.70 15 GOLD-W1 14.75 14.87

16 NWR 1.43 16 SPCG-W1 14.64 13.31

17 DTAC 31.31 17 TISCO 14.10 13.69

18 TRC 12.84 18 E-W1 14.00 22.27

19 DEMCO 6.21 19 THIP 13.97 12.64

20 TCAP 17.95 20 GBX 13.88 13.54

Source : SET.OR.TH

6 March 2013

6,806,500

526,450

4,287,600

786,002

1,477,800 5,765,400

248,099

7,006,5006,906,500

2,701,300 2,804,200

6,515,901

3,013,000

3,382,000 3,133,901

6,366,1125,580,110

3,539,450 6,552,450

7,266,800 319,200 7,586,000 6,947,600

5,102,300 2,357,400 7,459,700

503,405,255 -4,794,108

2,744,900

100,000

925,271,619 843,803,210 6,074,143,747

1,277,816,397 194,387,191 161,065,653

-5,280,400

99,645,251

74,242,098 74,970,598

40,979,900 2,809,800

147,453,300 1,089,076,392

5,505,500 -102,900

48,592,146 77,281,246

1,117,900

151,117,900 3,654,300

-3,765,1004,437,800 5,110,500

5,012,300

84,000 5,364,400

4,333,300 679,000

672,700

5,448,400

8,000,000

347,000,000

279,999,581

102,652,175

1,011,300

37,278,800

727,878,228

367,964,647 2,848,272,038 468,234,625

25,563,256 26,226,480 166,682,701

3,512,494,860

10,025,921,523

632,057,202 544,461,149

1,730,734,760 2,123,251,472

3,424,427

2,036,627,210

710,633 660,933

382,473,668 268,936,368

363,002,326 307,949,569

1,406,500

4,531,300 6,772,715

9,554,873 2,757,434

13,313,332 4,766,268

11,304,015 -2,241,415

12,312,307 6,797,439 1,716,553,249

9,039,800 4,273,532

9,662,300 6,849,300

9,901,500 1,621,200 11,522,700 8,280,300

8,255,800

9,506,055

-6,836,100

1,475,698,768

2,393,260,193

2,125,706

320,609,239 321,806,338

-1,328,900 2,354,634 6,759,300 8,088,200 14,847,500

572,486,791 -4,253,774

700,671,561 682,155,834

594,522,995 15,655,500 27,057,226

5,577,400 12,413,500 17,990,900

NetBuy Sell Total

1,908,842,894

207,500,000 5,565,100 22,400 22,300 213,065,100 201,934,900

11,401,726

33,858

Net Buy Net Sell Net Buy Net Sell

2 Jan- 5 Mar 131 - 5 Mar 13Mar / Feb 13 Mar / Feb 13

Total Volume Shares

5-Mar-13

NVDR Shrs. Paid up CapitalNVDR Shrs.

5-Mar-13 2-Jan-13

BUY VALUES SELL VALUES

Most Active Volume (shares) NVDR Shares to Total Paid-up Shares(%)

NET BUY NET SELL Month to Date Year to Date

Most Active Values (Btmn)

THAI NVDR : Top Ranking

RHB Research 06 Mar 2013

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1

Powered by Enhanced Datasystems’ EFA Platform

THAILAND EQUITY Investment Research

Company Update

Samart Corp PCL 2013 To Be a Golden Year SAMART’s share price has surged by 39% since our upgrade last month. It stands to benefit from huge ICT investments as state telcos upgrade their existing networks. The potential upside for the group, comprising SAMART, SAMTEL and SIM, lies in favorable news such as winning more ICT projects. As the stock is now trading at a cheap valuation, we strongly recommend a BUY, with a new THB30 TP based on 17.7x FY13 PER, on further upside from its call centre business’ listing later this year.

200% growth in FY13 backlog. As of last year, SAMTEL had THB9.6bn in backlog in its orderbook, of which THB6.13bn was expected to be booked as revenue in FY13. This year, its management hopes to secure THB36bn worth of projects, including the Advance Passenger Processing Services (APPS) and 3G network installation phase II. Therefore, SAMTEL expects its backlog to grow considerably to THB30bn at end-FY13, which will boost revenue to THB16bn in revenue for FY13.

SIM’s net profit to rebound strongly in FY13. While Thailand’s smartphone penetration remains low at below 20% partly due to their high prices, SIM is breaking into the low-end market by selling more affordable smartphones. As such, we expect the proportion of smartphones sales to increase by a significant 80% to 953k, which will boost gross margin to 23% in FY13. We see more upside from the government’s ‘one child one tablet’ project, for which the outcome of the auction will be made known this month.

TP upgraded to THB30 based on a 17.7x PE (~80% below +1SD from historical mean PE and industry average), or 4.85x PBV (+2SD from its historical mean PBV). The stock is currently trading at an undemanding FY13PEG of only 0.22x, with FY13/FY14 net profit growth of 59%/20%. Note that we have changed our valuation from NAV to reflect the stock’s high growth potential. There will be additional upside from the listing of its call center business, which is not included in our TP calculation, in 3Q13.

Wirin Eiamphoklarp 66 2862 9999 ext 2028 wirin.ei@th.oskgroup.com

Buy Target THB30.0

Previous THB22.0

Price THB22.4

Telecommunications SAMART is a holding company whose subsidiaries are engaged in ICT, mobile and multimedia business

Stock Statistics Bloomberg Ticker SAMART TB Market Cap THB22,172m USD744m 52 wk H/L price 22.4 8.80 3m ADT THB141m YTD Returns (%) 75.0 Beta (x) 0.94 Major Shareholders (%)

Vilailuck International Holdings 17.55 Watchai Vilailuck 14.15 Share Price Performance (%)

Month Absolute Relative 1m 54.5 51.6 3m 89.8 73.3 6m 143.5 117.9 12m 151.7 117.9 6-month Share Price Performance

81

101

121

141

161

181

201

221

7

9

11

13

15

17

19

21

23

05-M

ar-

12

07-M

ay-

12

09-J

ul-1

2

10-S

ep-

12

12-N

ov-1

2

14-J

an-1

3

Price Close Relative to Stock Exchange of Thailand Index (RHS)

Source: Bloomberg

Forecasts and Valuations Dec-10 Dec-11 Dec-12 Dec-13F Dec-14F

Total turnover (THBm) 16,266 19,964 17,100 27,479 34,165

Recurring net profit (THBm) 628 836 1,071 1,698 2,040

Recurring net profit growth 38.0% 33.1% 28.2% 58.5% 20.1%

Core EPS (THB) 0.62 0.83 1.06 1.69 2.03

Core EPS growth 38.0% 33.1% 28.2% 58.5% 20.1%

DPS (THB) 0.00 0.00 0.00 1.18 1.42

Dividend Yield 0.0% 0.0% 0.0% 5.3% 6.3%

Core P/E (x) 35.9 27.0 21.0 13.3 11.1

Return on average equity 17.2% 20.8% 23.6% 32.6% 34.8%

P/B (x) 5.85 5.37 4.63 4.06 3.66

EV/EBITDA (x) 15.3 12.6 11.1 9.0 8.2

Net debt to equity 72.8% 112.0% 95.5% 117.5% 123.1%

RHBRI vs consensus EPS

Source: Company data, RHBRI estimates

RHB Research 06 Mar 2013

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Powered by Enhanced Datasystems’ EFA Platform

Figure 1: SAMTEL’s outlook for FY13 Figure 2: SAMTEL’s backlog

TOT's 3G/4G Phase II expected to open to tender within 1H/2013

Phase I Phase I Phase IInstallation Progress Installation Progress Installation Progress

Completion = 3,400 sites Completion = 3,800 sites Complete the first phase of 3G installation

September December February May May - June2012 2012 2013 2013 2013

Relaunch Campaign NEXT PHASETOT to relaunch the 3G/4G TOT to expand the 2nd Phasecellular services on 4,000 of 3G/4G Network Installation

based stations

Figure 3: The progress of 3G/4G

Figure 4: SIM’s revenue and GPM Figure 5: SIM’s net profit and NPM

Source: Company data, OSK Source: Company data, OSK

Source: Company data, OSK

Source: Company data, OSK Source: Company data, OSK

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FINANCIALS

Profit & Loss (THBm) Dec-10 Dec-11 Dec-12 Dec-13F Dec-14F

Total turnover 16,266 19,964 17,100 27,479 34,165

Cost of sales (12,576) (15,987) (13,041) (21,322) (26,495)

Gross profit 3,690 3,977 4,059 6,157 7,670

Gen & admin expenses (851) (1,114) (1,016) (1,511) (1,878)

Selling expenses (1,337) (1,018) (900) (1,403) (1,744)

Other operating costs (245) (48) (94) (135) (168)

Operating profit 1,256 1,798 2,048 3,108 3,881

Operating EBITDA 2,214 2,878 3,234 4,406 5,229

Depreciation of fixed assets (958) (1,081) (1,186) (1,299) (1,349)

Operating EBIT 1,256 1,798 2,048 3,108 3,881

Interest expense (321) (391) (486) (479) (572)

Pre-tax profit 935 1,407 1,562 2,628 3,308

Taxation (132) (295) (202) (526) (662)

Minority interests (175) (276) (289) (405) (607)

Profit after tax & minorities 628 836 1,071 1,698 2,040

Net income to ord equity 628 836 1,071 1,698 2,040

Recurring net profit 628 836 1,071 1,698 2,040 Source: Company data, RHBRI

Balance Sheet (THBm) Dec-10 Dec-11 Dec-12 Dec-13F Dec-14F

Total cash and equivalents 1,060 1,220 1,391 610 729

Inventories 1,737 1,519 1,194 2,687 3,339

Accounts receivable 3,984 5,146 5,867 7,394 9,188

Total current assets 8,777 13,182 14,706 17,709 21,977

Other current assets 1,997 5,297 6,254 7,017 8,720

Tangible fixed assets 3,642 4,164 5,194 5,396 5,547

Intangible assets 218 218 324 218 218

Total other assets 893 788 893 1,080 1,342

Total non-current assets 4,752 5,170 6,412 6,693 7,106

Total assets 13,529 18,352 21,118 24,402 29,083

Short-term debt 4,563 6,446 6,376 8,529 10,598

Accounts payable 941 2,994 3,346 4,673 5,807

Other current liabilities 1,826 1,330 2,793 1,490 1,697

Total current liabilities 7,330 10,771 12,515 14,692 18,102

Total long-term debt 582 1,491 1,577 1,491 1,491

Other liabilities 8 94 152 213 265

Total non-current liabilities 590 1,585 1,729 1,704 1,756

Total liabilities 7,921 12,356 14,244 16,396 19,858

Share capital 980 986 991 1,007 1,007

Retained earnings reserve 189 189 101 189 189

Other reserves 2,682 3,023 3,774 4,354 4,965

Shareholders' equity 3,851 4,198 4,865 5,549 6,161

Minority interests 1,221 1,302 1,468 1,873 2,480

Other equity 537 496 541 584 584

Total equity 5,609 5,995 6,874 8,006 9,225

Total liabilities & shareholders' equity 13,529 18,352 21,118 24,402 29,083 Source: Company data, RHBRI

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Cashflow (THBm) Dec-10 Dec-11 Dec-12 Dec-13F Dec-14F

Operating profit 1,256 1,798 2,048 3,108 3,881

Depreciation & amortisation 958 1,081 1,186 1,299 1,349

Change in working capital 967 (2,297) 33 (2,978) (3,018)

Other operating cashflow (148) (668) (721) (166) (607)

Operating cashflow 3,033 (87) 2,547 1,261 1,605

Interest paid (321) (391) (486) (479) (572)

Tax paid (132) (295) (202) (526) (662)

Cashflow from operations 2,579 (773) 1,859 256 371

Capex (931) (1,026) (501) (1,500) (1,500)

Other new investments (18) (49) - - -

Other investing cashflow 552 28 (1,643) 155 509

Cashflow from investing activities (397) (1,046) (2,144) (1,345) (991)

Dividends paid to ordinary shareholders (242) (743) (618) (1,189) (1,428)

Proceeds from issue of shares 36 47 60 86 -

Increase in debt (1,459) 2,747 435 1,161 2,069

Other financing cashflow (752) 113 574 - -

Cashflow from financing activities (2,417) 2,164 451 59 641

Cash at beginning of period 960 724 1,069 1,235 205

Total cash generated (235) 345 166 (1,030) 21

Implied cash at end of period 724 1,069 1,235 205 226 Source: Company data, RHBRI

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RECOMMENDATION CHART

4

6

8

10

12

14

16

18

20

22

Mar-08 Jun-09 Sep-10 Dec-11

Price Close

NR

10.6

14.2

22.0

Recommendations & Target Price

Buy Neutral Sell Trading Buy Take Prof it Unrated

Source : RHBRI, Bloomberg

Date RecommendationTarget Price Price

2013-02-28 Buy 22.0 19.1

2012-11-14 Buy 14.2 11.2

2012-06-25 Buy 10.6 9.0 Source : RHBRI, Bloomberg

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RHB Guide to Investment Ratings Buy: Share price may exceed 10% over the next 12 months

Trading Buy: Share price may exceed 15% over the next 3 months, however longer-term outlook remains uncertain

Neutral: Share price may fall within the range of +/- 10% over the next 12 months

Take Profit: Target price has been attained. Look to accumulate at lower levels

Sell: Share price may fall by more than 10% over the next 12 months

Not Rated: Stock is not within regular research coverage Disclosure & Disclaimer All research is based on material compiled from data considered to be reliable at the time of writing, but RHB does not make any representation or warranty, express or implied, as to its accuracy, completeness or correctness. No part of this report is to be construed as an offer or solicitation of an offer to transact any securities or financial instruments whether referred to herein or otherwise. This report is general in nature and has been prepared for information purposes only. It is intended for circulation to the clients of RHB and its related companies. Any recommendation contained in this report does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This report is for the information of addressees only and is not to be taken in substitution for the exercise of judgment by addressees, who should obtain separate legal or financial advice to independently evaluate the particular investments and strategies. RHB, its affiliates and related companies, their respective directors, associates, connected parties and/or employees may own or have positions in securities of the company(ies) covered in this research report or any securities related thereto, and may from time to time add to, or dispose off, or may be materially interested in any such securities. Further, RHB, its affiliates and related companies do and seek to do business with the company(ies) covered in this research report and may from time to time act as market maker or have assumed an underwriting commitment in securities of such company(ies), may sell them or buy them from customers on a principal basis and may also perform or seek to perform significant investment banking, advisory or underwriting services for or relating to such company(ies), as well as solicit such investment, advisory or other services from any entity mentioned in this research report. RHB and its employees and/or agents do not accept any liability, be it directly, indirectly or consequential losses, loss of profits or damages that may arise from any reliance based on this report or further communication given in relation to this report. The term “RHB” shall denote where applicable, the relevant entity distributing the report in the particular jurisdiction mentioned specifically herein below and shall refer to RHB Research Institute Sdn Bhd, its holding company, affiliates, subsidiaries and related companies. All Rights Reserved. This report is for the use of intended recipients only and may not be reproduced, distributed or published for any purpose without prior consent of RHB and RHB accepts no liability whatsoever for the actions of third parties in this respect. Malaysia This report is published and distributed in Malaysia by RHB Research Institute Sdn Bhd (233327-M), Level 11, Tower One, RHB Centre, Jalan Tun Razak, 50400 Kuala Lumpur, a wholly-owned subsidiary of RHB Investment Bank Berhad (RHBIB), which in turn is a wholly-owned subsidiary of RHB Capital Berhad. As of 05 Mar 2013, RHBIB does not have proprietary positions in the subject companies, except for: a) - As of 05 Mar 2013, none of the analysts who covered the stock in this report has an interest in the subject companies covered in this report, except for: a) Samart Corp PCL Singapore This report is published and distributed in Singapore by DMG & Partners Research Pte Ltd (Reg. No. 200808705N), a wholly-owned subsidiary of DMG & Partners Securities Pte Ltd, a joint venture between OSK Investment Bank Berhad, Malaysia (“OSKIB”) and Deutsche Asia Pacific Holdings Pte Ltd (a subsidiary of Deutsche Bank Group). DMG & Partners Securities Pte Ltd is a Member of the Singapore Exchange Securities Trading Limited and is a subsidiary of OSKIB, which in turn is a wholly-owned subsidiary of RHB Capital Berhad. DMG & Partners Securities Pte Ltd may have received compensation from the company covered in this report for its corporate finance or its dealing activities; this report is therefore classified as a non-independent report. As of 05 Mar 2013, DMG & Partners Securities Pte Ltd and its subsidiaries, including DMG & Partners Research Pte Ltd do not have proprietary positions in the subject companies, except for: a) - As of 05 Mar 2013, none of the analysts who covered the stock in this report has an interest in the subject companies covered in this report, except for: a) Samart Corp PCL

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