EQUITY RESEARCH | DAILY EDGEFriday, November 12, 2021, Intraday Flash

For Reg AC Certification and important disclosures see Appendix A of this report. Analysts employed by non-U.S. affiliates are notregistered/qualified as research analysts with FINRA in the U.S. unless otherwise noted within this report.

1

Qtly EPS (Basic) Q1 Q2 Q3 Q4 Year P/EPS2019A $379.11 $231.42 $285.69 $204.33 $1,100.55 23.1x2020A $413.57 $300.96 $305.77 $230.32 $1,250.62 19.2x2021E $498.89A $298.09A $365.71A $313.18 $1,475.86 14.7x2022E $422.85 $334.51 $402.57 $350.63 $1,510.57 14.4x

(FY-Dec.) 2019A 2020A 2021E 2022ERevenues (M) $9,958,851 $11,127,541 $12,572,089 $13,653,444EBITDA (M) $1,347,229 $1,443,576 $1,566,732 $1,705,603EBITDA Margin 13.5% 13.0% 12.5% 12.5%Return on Equity 8.7% 9.2% 10.5% 10.2%

Historical price multiple calculations use FYE prices. All values in COP unless otherwise indicated.Source: FactSet; company reports; Scotiabank GBM estimates.

Dissemination: November 12, 2021, 09:57 ET. Production: November 12, 2021, 09:48 ET.

CAPITALIZATION

Market Cap. (M) US$2,598Enterprise Value (B) $13,578Shares O/S (M) 460Float O/S (M) 255

Volume and Closing Price for NUTRESA-CN27k

26k

25k

24k

23k

22k

21k

20k

19kNov-21Sep-21Jul-21May-21Mar-21Jan-21

5

4

3

2

1

0

NUTRESA-CNVolume

Vol (

M)

Pric

e

Source: FactSet.

NutresaHostile Take-over Offer for Nutresa – Unlikely Moonshot butGreat for Minorities

Our Take: Positive. Grupo Gilinski launched a hostile take-over bid (OPA) for controlof Nutresa. We think it’s a low-ball bid (see pg. 2 for valuation discussion and comps),but beyond valuation, we believe that the bid is unlikely to reach the minimum thresholdfor control. Shares will be suspended for some weeks while the process moves along(timeline in pg. 7) but they will trade again in a few days/weeks. Regardless of thelikelihood of approval (in its current form/price), the offer does raise several interestingpoints. First, it’s likely that the Gilinski’s know about the low likelihood of success, so thisbegs the question: what are we missing? Some theories in pg. 5.

Additionally, this supports our long-held thesis that the shares are deeply undervalueddue to several reasons. We explore them in pg. 3, but the reality is that a new highervalue for the shares has been put on the table and that subsequent higher ones couldfollow. That’s good for Nutresa shareholders which should see the shares rise whenthey reopen for trading.

From our point of view, we had a neutral on Nutresa shares due low valuation with alack of drivers (inflation, commodities, elections). However, a driver was just put on thetable and we’ll stick to our long-held mantra: valuation plus drivers equals upgrade. Weare raising Nutresa to Outperform. We expect the shares to rise when they trade again.

Lastly, this is a wake-up call for GEA because it may have just been put in anuncomfortable position. If it wants to keep control, the offer fail must fail. If it does, thenit’d better hope that the shares don’t plunge back down. Because if they do, it will looklike GEA denied the opportunity to minority shareholders of receiving a 37% premium ontheir shares. And that’s not good marketing.

Hostile Take-over Announcement: Grupo Gilinski, issued a hostile takeover bid for50.1% to 62.625% of Nutresa at a price of US$7.71 (or ~COP 29,891) that representsa 37% premium to Nov. 10 market close (COP 21,740). If successful, the takeover bidwould amount to between US$1.8bn and US$2.2bn. We don’t think it will be successfulin its current form/price.

Who is Grupo Gilinski? One of the richest family conglomerates in Colombia, withholdings that include Banco GNB Sudameris (traditional commercial bank), RevistaSemana (magazine), Yupi (snacks), Lulo (online bank venture), and large real estateholdings around the world, among many others. They were also owners of Banco deColombia (before the selling to GEA) and Banco Andino. [Continues on page 2]

ANALYST TEAM Link to ScotiaView

LATAM FOOD AND BEVERAGES Felipe Ucros | Analyst212-225-5098Scotia Capital (USA) Inc.

Juan Jose Guzman, MSc | Associate511-211-6851Scotia Sociedad Agente de Bolsa SA

PERTINENT DATA

Rating Sector Outperform1-Yr. Target COP 28,000

NUTRESA-CN COP 21,900

1-Yr. Return 31.1%Div. (NTM) $708.84Div. (Curr.) $677.66Yield (Curr.) 3.1%

Valuation: Explicit 10-Year DCF @ 11.0%

PERTINENT REVISIONS

New OldRating SO SP

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Opportunistic Investors that Don’t Shy Away from Controversy: The Gilinskis have a reputation for an

opportunistic investment style. The group has very profitably bought and sold off troubled banks several

times. That has led them to multiple appearances in the covers of newspapers. In addition, there’s the

recent acquisition of Semana, one of the largest magazines in Colombia, which was also highly controversial

and you can read it here. The Gilinskis are not shy, and the group won’t mind if this story is widely covered

and opined by the media in Colombia over the coming weeks.

Historically Not Best Friends: The fact that the Gilinskis didn’t do a friendly approach to GEA for Nutresa

should not be surprising to international investors. You can read here and here about another controversial

transaction in which both groups bumped heads over the Banco de Colombia takeover.

Valuation – What is Nutresa Worth?

1. Is the offer fair or attractive? Not in our opinion.

It Has Been at This Price Before: First, let’s remember that Nutresa already traded near the offer price in

2014 (see Exhibit 1), when its EBITDA was ~40% lower than in 2020. If Nutresa was in a crisis, then that

would be understandable, but it’s not. So that’s a first sign that the offer is not great.

Offer is at Historical Trading Average: Second, ignoring business/macro cycles and speaking purely from

a fundamental angle, the LatAm F&B sector has traded around 9x EV/EBITDA over the decade that

preceded the pandemic. Therefore, a multiple of 9x for normalized EBITDA would be a fair market value for

a publicly traded company.

Which Completely Ignores the Control Premium: However, there’s the issue of the control premium. If

you want to buy a share in the open market, you pay the market price, but if you want 50% plus one share,

the price tag is another one because you need to convince the controller to sell.

Transaction Comps Say that the Offer is Not Good Enough: That’s why we look at this transaction

comps table (see Exhibit 3) which shows that while comps traded at 9x historically, control premiums of 40%

to 50% have usually taken average transaction multiples to 13x EBITDA.

Exhibit 1: Nutresa Stock Price Performance (in COP)

Source: Bloomberg; Scotiabank GBM.

15,000

17,500

20,000

22,500

25,000

27,500

30,000

Oct

-10

Apr

-11

Oct

-11

Apr

-12

Oct

-12

Apr

-13

Oct

-13

Apr

-14

Oct

-14

Apr

-15

Oct

-15

Apr

-16

Oct

-16

Apr

-17

Oct

-17

Apr

-18

Oct

-18

Apr

-19

Oct

-19

Apr

-20

Oct

-20

Apr

-21

Oct

-21

Exhibit 2: LatAm Food – Historical NTM EV/EBITDA

Source: Bloomberg; Company reports; Scotiabank GBM estimates.

6x

7x

8x

9x

10x

11x

12x

13x

Q4-

10

Q2-

11

Q4-

11

Q2-

12

Q4-

12

Q2-

13

Q4-

13

Q2-

14

Q4-

14

Q2-

15

Q4-

15

Q2-

16

Q4-

16

Q2-

17

Q4-

17

Q2-

18

Q4-

18

Q2-

19

Q4-

19

Q2-

20

Q4-

20

Q2-

21

+/- 1 Std. Dev. Industry EV/EBITDA (NTM) Industry Avg.

Industry Avg: 9.4x

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EBITDA is Also Depressed: That compares to a 9x NTM EBITDA multiple offered by the Gilinskis (based

on our model), which is not only significantly below the control premium, but also one that uses a depressed

EBITDA due to the current logistics and commodities turmoil we have baked into our 2022 numbers.

37% Sounds Nice, but 96% is Better: While a 37% premium may sound nice to some, a deeper look

shows the reality that Nutresa is one of the most attractive food companies in LatAm, with leading market

shares in almost every category, and that to purchase control, you have to pay dearly (in our view, it’s a

better asset than anything on that comps list).

13X EBITDA, is approximately a 96% premium to the latest price. That’s better than 37%.

The Bimbo and MDB Analogy: We’ll put it like this: do you think that Daniel Servitje or the Dias Branco

family would sell Bimbo or M. Dias Branco at 9x EBITDA? Not a chance, right? There’s your answer. The

Gilinsksi bid is a low-ball bid. But one that creates a problem for GEA (more on that later).

However, this raises another question: why is Nutresa so cheap that a 37% premium only takes it to 9x

EBITDA?

2. Why are the shares so deeply undervalued today?

Many factors. First, there’s LatAm and the commodities cycle. Its current multiple reflects a general rerating

of publicly traded securities in LatAm since the end of the last commodities super-cycle. Food companies

traded down from 12x to 7x EBITDA since 2013, the peak of that cycle. However, we appear to have past

the bottom of the super-cycle and pandemic, and firms are generally rebounding from the depths of last year

(6x EBITDA). Take a look at Bimbo or Gruma. Or even Arca, KOF, CCU and Ambev.

However, Nutresa has decoupled from its comps. That’s due to the political risk in Colombia which is

nearing elections with a leftist candidate ahead in the polls. Not to mention the rising fiscal risk.

Lastly, the shares volume has dropped their ADTV below US$1mn. This, added to the crossholding

structure, also drives a large number of international investors away, and likely drives another piece of the

Exhibit 3: LatAm Food Coverage – Selected Material Transactions

(1) Includes the consumer business at 9.2x (LTM) and the crushing business at 4.4x (cycle adjusted).

Note: We define material transactions if the target’s sales prior to acquisition are equal to or higher than 5% of the buyer’s sales in the same period.

Source: FactSet; Bloomberg; Company reports; Scotiabank GBM estimates.

Food Coverage - Material Transactions

Deal Details Deal Valuation Sales (Prior to Acq.)

Buyer TargetAnnounce

DateTarget Country

Target EV (in

US$ million)EV/Sales EV/EBITDA

Target (in

US$ million)% of Buyer

Alicorp Intradevco 31-Jan-19 Peru $515 2.4x 12.6x $215 8%

M. Dias Branco Piraquê 29-Jan-18 Brazil $418 2.0x 14.0x $214 13%

Alicorp 1 IdA & ADM-SAO 16-Jan-18 Bolivia $420 0.9x 6.3x $447 20%

Lala Vigor 01-Aug-17 Brazil $1,307 1.8x 21.6x $727 24%

Lala Lala US 30-May-16 United States $246 1.2x NA $200 7%

Nutresa El Corral 28-Nov-14 Colombia $384 1.8x 11.0x $232 7%

Bimbo Canada Bread 12-Feb-14 Canada $1,358 1.0x 7.8x $1,411 10%

Nutresa Tresmontes Lucchetti 18-Jul-13 Chile $739 1.7x 12.3x $440 14%

Alicorp Pastificio Santa Amália 07-Feb-13 Brazil $422 1.4x 15.6x $293 17%

Herdez Grupo Nutrisa 17-Jan-13 Mexico $238 2.6x 18.1x $87 9%

Average $605 1.7x 13x $427 13%

Median $421 1.7x 13x $262 12%

Recent Food Mega-Deals (including Withdrawn Offers)

Deal Details Deal Valuation Sales (Prior to Acq.)

Buyer TargetAnnounce

DateTarget Country

Target EV (in

US$ million)EV/Sales EV/EBITDA

Target (in

US$ million)% of Buyer

ConAgra Brands Inc. 2 Pinnacle Foods Inc. 27-Jun-18 United States $10,749 3.4x 18.3x $3,140 40%

Ferrero SpA 2 Nestle's Confectionery Biz 16-Jan-18 United States $2,800 3.1x NA $900 9%

Campbell Soup Co. 2 Snyder's-Lance, Inc. 18-Dec-17 United States $5,989 2.8x 23.8x $2,123 27%

The Hershey Co. Amplify Snack Brands, Inc. 17-Dec-17 United States $1,488 4.0x 18.3x $372 5%

The Kraft Heinz Co. 2 Unilever Plc 17-Feb-17 United Kingdom $154,495 2.6x 15.1x $58,311 220%

Danone WhiteWave Foods 07-Jul-16 United States $12,086 3.0x 24.0x $3,866 16%

Mondelez 2 The Hershey Co. 30-Jun-16 United States $25,649 3.5x 15.0x $7,336 27%

PE Group Krispy Kreme Doughnuts 09-May-16 United States $1,264 2.4x 17.1x $523 NA

McCormick 2 Premier Foods 23-Mar-16 United Kingdom $1,650 1.4x 9.6x $1,159 27%

Mondelez + PE Group Keurig Green Mountain 07-Dec-15 United States $14,115 3.1x 13.7x $4,520 17%

Pinnacle Foods Boulder Brands 24-Nov-15 United States $959 1.9x 23.5x $508 19%

Snyder's-Lance Diamond Foods 28-Oct-15 United States $1,914 2.2x 17.8x $864 46%

H.J. Heinz + PE Group Kraft Foods Group 25-Mar-15 United States $54,810 3.0x 15.0x $18,205 167%

The J. M. Smucker Co. Big Heart Pet Brands 03-Feb-15 United States $5,614 2.5x 16.1x $2,267 41%

The Hillshire Brands 2 Pinnacle Foods 12-May-14 United States $6,616 2.7x 14.3x $2,495 63%

D.E. Master Blenders 1753 Mondelez's Coffee Biz 07-May-14 United States $5,295 1.4x NA $3,900 NA

Average $19,093 2.7x 17x $6,906 52%

Median $5,802 2.7x 17x $2,381 27%

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discount. After this is all over, we would not be surprised if Nutresa aimed to solve these problems in an

accelerated manner.

In our view, anybody that sells at the offer price is selling at the worst moment and on the cheap.

Shareholding Structure – Why the Deal is Likely to Fail, in our view

GEA – Cross-Holding Structure: GEA (Grupo Empresarial Angtioqueño) is not far from controversy either.

International investors tend to dislike their cross-holding structure, where dual shareholding structures

abound. That structure was originally intended to defend from hostile takeovers. While the structure has

been criticized, this is exactly why it’s in place. GEA controls ~45% of Nutresa via Sura (35.5%) and Grupo

Argos (9.9%%), and it is well understood that if minorities buy into Nutresa, they are likely giving away the

chance of receiving a takeover premium.

Structure Makes this a No-Go: Assuming that GEA doesn’t want to sell (as has usually been the case), the

Gilinskis would need to get to the approval threshold via the remaining 55% float. That’s a steep ask, given

that the Gilinskis would still have to get the founding families, Nutresa’s treasury shares, Proteccion’s vote

and some typical non-voters to support the transaction.

The Medellin Founding Families: In addition to the crossholdings, there are several Medellin families in

the shareholding structure, which have shares because the businesses they founded are now part of

Nutresa (outright sales, mergers, share exchanges and many others). Given their position in GEA boards,

their family’s tradition in the company and social bonds that tie them to the fabric of Medellin, we are highly

skeptical that they would sell to the Gilinskis. We estimate them at 7.5% of Nutresa’s shareholding, and we

are not even including Amalfi SAS (they have been reducing their share to less than 1% and they are from

Cali).

Nutresa’s Treasury Shares: Nutresa has actively been buying its own shares given its attractive multiples.

In our opinion this is the best M&A the company has ever done, but putting that aside, it’s another 0.5% of

the shares that Gilinskis are not getting a vote from.

Non-voters: It’s also well known that a percentage of the float does not vote in these transactions. The

shares might be in a succession process, the holder may be travelling and not checking emails from the

broker, or they read the proxy email and forgot to respond. Either way, there’s a margin for error here, too.

Protección: The count already puts GEA way ahead of the 50% that Gilinski needs. But then there’s

Protección, GEAs pension fund. If the price was higher and eventually attractive, they might have to vote in

favor of the transaction (fiduciary issues), but at this level, they have all the support they need to vote

against the takeover. Which puts the GEA votes firmly above the threshold where the offer is a no-go.

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But the Gilinskis surely got some advice ahead of the transaction and what we know just as well. So, what’s

their angle?

So, what’s their Angle?

We’ve explored other theories from some of the investors that called us after the announcement and here

are the two most repeated stories:

Theory 1 – Trading Position: Some think that the Gilinkis may have built a position in Nutresa ahead of

today’s offer. In that case, if the offer fails, it would still yield them some handsome profits from the pre-built

position because shares usually trade up to levels near the offer price.

Our Opinion – We Don’t Think So: We’ve looked at recent holdings in Nutresa and out of the reported

positions as of 6/30/21, we don’t see any vehicles above 1% holding that appear to be the Gilinskis. In

addition, based on the trading volume of Nutresa and the fact the Nutresa has been repurchasing shares, a

position built past 6/30/21 would not be large enough to merit the trouble for a group this large. We think this

is an unlikely thesis.

Exhibit 4: Nutresa – Main Shareholders and GEA Crossholdings Structure

Source: Company reports; Scotiabank GBM estimates.

35.5% 5.3%

9.9%

13.1%

12.5%

Other long-term

shareholders based in

Medellín

7.5% Other Colombian

Pension Funds (Skandia,

Colfondos & Porvenir)

13.9%

49.4%

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Theory 2 – Politics: Finally, an investor has asked us if we think that the current recall process of the mayor

of Medellin, Daniel Quintero, could be related. We were unaware of the process, so we’ve read in depth

about it. Here are a few long articles in Spanish, but if you want to talk to us about this, we are available for

calls:

- Quintero Fights with Medellin’s Business Establishment and Hands Power to His Friends

- GEA Denies the Accusations from Quintero

- Medellin Mayor Reveals his First Appointees to EPM and Ruta N Boards

- Ángel Beccassino: An Old Ally of the Gilinskis in his Old Fight Against GEA is now Daniel

Quintero’s Key Advisor

- Daniel Quintero Reaches a New Low in Approval Rating Levels

- Recall on Daniel Quintero Gathers Enough Signatures to Oust Him

Abu Dhabi’s Involvement – Unlimited Firepower IS a Risk: Newspapers have been writing that Abu

Dhabi is involved as a partner in the Gilinski offer. We could not verify this information, but one thing is clear.

With that kind of backing, the firepower could be nearly unlimited. And that’s definitely something that GEA

should be looking at carefully. If they are going to defend their position, it might be a good idea to bring in a

partner with equally unlimited fire-power (old friends from the Sura transaction perhaps?). Because maybe,

this is just the first of many steps, where there are subsequent higher offers until there can be a lawsuit for

breach of fiduciary duties (due to the cross-holding structure), or a point where the offer is too good for the

families to ignore.

Our Opinion – We Don’t Have One: None. This definitely sounds like a Colombian novela. If you haven’t

seen one, perhaps you’ve seen a Mexican one. So, take that, and now multiply it by three. All jokes-aside,

we don’t know enough about Medellin’s politics to give an educated opinion about this. In fact, all of the

articles we referenced (we tried to mix and match across publications to avoid a bias) are things we read in

the last few hours after talking to investors.

Our Conclusion

Win/win for Minority Investors: Regardless of where this ends up, it’s good for minority investors. Gilinski

has shown willingness to pay a price that is 37% above current prices and the shares should re-rate purely

on that news. Now, depending on GEA’s next move, this could become a bidding war, which is also be great

for minorities. It’s a win-win for them.

Awkward Position for GEA

Two Options to Play: There’s a catch to all this. If the OPA is accepted by regulators, the shares will trade

again during a period where the OPA will be open (starting from a few days from now to a little more than 30

from now under Exito’s timeline). And that means that GEA can select if it lets the process play out (trusting

that founding families don’t go for the offer) or if it acquires some more shares (say 4%-6%), which will take

them near or above the 50% threshold, guaranteeing a failed OPA.

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4%-6% Acquisition is a Better Option: We think that the latter option carries lower risk (and could make

the shares trade higher than the Gilinski offer). Some GEA shareholders may have limits, but others may

not. In any case, GEA has a hand to play defense. However, all of this has put GEA in an awkward ESG

position, especially on the G side.

Awkward Position: There’s a high chance that GEA picks a scenario, wins the battle, and Gilinskis have to

walk away or come back with a new offer. However, if that happens, the shares may come back down to

where they were ahead of the original offer. And in that case, GEA might have to explain why it stopped

minorities from getting a 37% higher price in the first place.

Exhibit 5: Tender Offer Timeline Details

Steps Description:

1. Request for approval sent to the Colombia's Securities Regulator (SFC). Colombia's Stock Exchange (BVC) suspends the target company’s stock trading.

2. SFC gives its final opinion (otherwise, administrative silence is considered as a positive response to the request).

3. The tender offer statement is published, and the target's stock resumes trading.

4. Tender offer begins.

5. Offer period - Min: 10d / Max: 30d.

6. Request for period extension.

Source: Superintendencia Financiera de Colombia (SFC); Scotiabank GBM.

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Company Overview

Company Description

Nutresa is a leading Latin American manufacturer and distributor of branded consumer food products. Founded in 1920 in Colombia,where it evolved through a solid combination of organic growth and a successful acquisition strategy, it manages more than 168 brands,17 of which generate annual sales of US$50 million each. While Nutresa’s products can be found in nearly 72 countries around theworld, the company mainly generates revenue through eight business segments distributed in the 14 countries where it operates its 45manufacturing plants.

Risks

Key Risks: Economic, raw materials, foreign exchange, political and geographic, regulatory, interest rate, M&A, corporate governance.

Total Return Index of NUTRESA-CN

Source: Scotiabank GBM; FactSet.

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Appendix A: Important Disclosures

Company Disclosures (see legend below)*

Bimbo VS0429M. Dias Branco J, V0178, VS0687

I, Felipe Ucros, certify that (1) the views expressed in this report in connection with securities or issuers that I analyze accurately reflectmy personal views and (2) no part of my compensation was, is, or will be directly or indirectly, related to the specific recommendationsor views expressed by me in this report.

This document has been prepared by Research Analysts employed by The Bank of Nova Scotia and/or its affiliates. The Bank of NovaScotia, its subsidiaries, branches and affiliates are referred to herein as "Scotiabank." "Scotiabank" together with "Global Banking andMarkets" is the marketing name of the global corporate and investment banking and capital markets business of The Bank of NovaScotia and its affiliates. Scotiabank, Global Banking and Markets produces research reports under a single marketing identity referredto as "globally branded research" under U.S. rules. This research is produced on a single global research platform with one set of ruleswhich meet the most stringent standards set by regulators in the various jurisdictions in which the research reports are produced. Inaddition, the Research Analysts who produce the research reports, regardless of location, are subject to one set of policies designed tomeet the most stringent rules established by regulators in the various jurisdictions where the research reports are produced.

Scotiabank relies on information barriers to control the flow of non-public or proprietary information contained in one or more areaswithin Scotiabank into other areas, units, groups or affiliates of Scotiabank. In addition, Scotiabank has implemented procedures toprevent research independence being compromised by any interactions they may have with other business areas of The Bank of NovaScotia. The compensation of the Research Analyst who prepared this document is determined exclusively by Scotiabank ResearchManagement and senior management (not including investment or corporate banking).

Research Analyst compensation is not based on investment or corporate banking revenues; however, compensation may relate tothe revenues of Scotiabank as a whole, of which investment banking, corporate banking, sales and trading are a part. ScotiabankResearch will initiate, update and cease coverage solely at the discretion of Scotiabank Research Management. Scotiabank Researchhas independent supervisory oversight and does not report to the corporate or investment banking functions of Scotiabank.

For Scotiabank, Global Banking and Markets Research Analyst Standards and Disclosure Policies, please visitwww.gbm.scotiabank.com/disclosures.

For additional questions, please contact Scotiabank, Global Banking and Markets Research, 4 King St W, 12th Flr, Toronto, Ontario,M5H 1A1.

Time of dissemination: November 12, 2021, 09:57 ET. Time of production: November 12, 2021, 09:48 ET. Note: Time of disseminationis defined as the time at which the document was disseminated to clients. Time of production is defined as the time at which theSupervisory Analyst approved the document.

*Legend

J Scotia Capital (USA) Inc. or its affiliates expects to receive or intends to seek compensation for investment banking services inthe next 3 months.

V0178 Scotiabank Brasil S.A. Banco Multiplo is acting as financial advisor to M. Dias Branco SA in the announced agreement toacquire privately owned Latinex Importacao E Exportacao De Alimentos SA.

VS0429 Research Associate Juan Guzman visited Azcapotzalco, a production plant, on May 25, 2016. The issuer did not pay for anyof the travel-related expenses incurred by the Research Analyst to visit the site.

VS0687 Research Associate Juan Guzman visited M. Dias Branco's Piraquê production plant in Rio de Janeiro on December 5, 2018.The issuer did not pay for any of the travel-related expenses incurred by the Research Associate to visit this site.

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Rating and Price Target History

Nutresa (NUTRESA-CN) as of November 11, 2021 (in COP)

Pric

e (C

OP)

30,000

28,000

26,000

24,000

22,000

20,000

18,000

16,000Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22

02-06-2017Price: 24,000.00Rating: SOTarget: 31,000.00

02-24-2020Price: 25,300.00Rating: SOTarget: 33,000.00

04-27-2020Price: 23,200.00Rating: SOTarget: 30,000.00

08-03-2021Price: 20,350.00Rating: SPTarget: 28,000.00

*Represents the value(s) that changed.Ratings Legend: FS=Focus Stock; SO=Sector Outperform; SP=Sector Perform; SU=Sector Underperform; T=Tender; UR=Under Review; CS=Coverage Suspended;DC=Discontinued CoverageSource: Scotiabank GBM estimates; FactSet.

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Definition of Scotiabank, Global Banking and Markets Equity Research RatingsScotiabank has a three-tiered rating system, with ratings of Sector Outperform, Sector Perform, and Sector Underperform. EachResearch Analyst assigns a rating that is relative to his or her coverage universe or an index identified by the Research Analyst thatincludes, but is not limited to, stocks covered by the Research Analyst.

The rating assigned to each security covered in this report is based on the Scotiabank, Global Banking and Markets Research Analyst’s12-month view on the security. Research Analysts may sometimes express in research reports shorter-term views on these securitiesthat may impact the price of the equity security in a manner directly counter to the Research Analyst’s 12-month view. These shorter-term views are based upon catalysts or events that may have a shorter-term impact on the market price of the equity securitiesdiscussed in research reports, including but not limited to the inherent volatility of the marketplace. Any such shorter-term viewsexpressed in research report are distinct from and do not affect the Research Analyst’s 12-month view and are clearly noted as such.Ratings

Sector Outperform (SO)The stock is expected to outperform the average 12-month totalreturn of the analyst’s coverage universe or an index identifiedby the analyst that includes, but is not limited to, stocks coveredby the analyst.

Sector Perform (SP)The stock is expected to perform approximately in line withthe average 12-month total return of the analyst’s coverageuniverse or an index identified by the analyst that includes, butis not limited to, stocks covered by the analyst.

Sector Underperform (SU)The stock is expected to underperform the average 12-monthtotal return of the analyst’s coverage universe or an indexidentified by the analyst that includes, but is not limited to,stocks covered by the analyst.

Focus Stock (FS)As of April 29, 2019, Scotiabank GBM discontinued the FocusStock rating. A stock assigned this rating represented ananalyst’s best idea(s); stocks in this category were expectedto significantly outperform the average 12-month total returnof the analyst’s coverage universe or an index identified by theanalyst that included, but was not limited to, stocks covered bythe analyst.

Other RatingsUnder Review – The rating has been temporarilyplaced under review, until sufficient information hasbeen received and assessed by the analyst.

Tender – As of January 25, 2021, Scotiabank GBMdiscontinued the Tender rating.

Risk RankingThe Speculative risk ranking reflects exceptionallyhigh financial and/or operational risk, exceptionallylow predictability of financial results, andexceptionally high stock volatility. The Directorof Research and the Supervisory Analyst jointlymake the final determination of the Speculative riskranking.

Scotiabank, Global Banking and Markets Equity Research Ratings Distribution*

Distribution by Ratings and Equity and Equity-Related Financings*

51.9%

42.9%

5.2%34.1% 20.3% 6.9%

Sector Outperform Sector Perform SectorUnderperform

0%

25%

50%

75%

* As of October 31, 2021. Source: Scotiabank GBM.

Percentage of companies covered byScotiabank, Global Banking and Markets EquityResearch within each rating category.

Percentage of companies within each ratingcategory for which Scotiabank, Global Bankingand Markets has undertaken an underwritingliability or has provided advice for a fee withinthe last 12 months.

For the purposes of the ratings distribution disclosure FINRA requires members who use a ratings system with terms differentthan “buy,” “hold/neutral” and “sell,” to equate their own ratings into these categories. Our Sector Outperform, Sector Perform,and Sector Underperform ratings are based on the criteria above, but for this purpose could be equated to buy, neutral andsell ratings, respectively.

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General Disclosures

This document is for distribution only as may be permitted by law. It is not directed to, or intended for distribution to or use by, anyperson 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 or would subject Scotiabank to any registration or licensingrequirement within such jurisdiction. It is published solely for information purposes; it is not an advertisement nor is it a solicitation or anoffer to buy or sell any financial instruments or to participate in any particular trading strategy.

No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of theinformation contained in this document except with respect to information concerning Bank of Nova Scotia (TSX: BNS; NYSE: BNS).This document is not intended to be a complete statement or summary of the securities, markets or developments referred to in thisdocument. Scotiabank does not undertake to update or keep current the information contained herein, nor make any commitment as tothe frequency of publication.

If you are affected by MiFID II, you must advise us in writing at trade_supervision@scotiabank.com.

Any opinions expressed in this document may change without notice and may differ or be contrary to opinions expressed by otherbusiness areas or groups of Scotiabank. Any statements contained in this document attributed to a third party represent Scotiabank’sinterpretation of the data, information and/or opinions provided by that third party either publicly or through a subscription service, andsuch use and interpretation have not been reviewed by the third party. Nothing in this document constitutes a representation that anyinvestment strategy or recommendation is suitable or appropriate to an investor's individual circumstances or otherwise constitutes apersonal recommendation. Investments involve risks, and investors should exercise prudence and their own independent judgement inmaking their investment decisions and carefully consider any risks involved.

The financial instruments that may be described in this document may not be eligible for sale in all jurisdictions or to certain categoriesof investors. Instruments such as options, derivative products, and futures are not suitable for all investors, and trading in theseinstruments is considered risky. Mortgage and asset-backed securities may involve a high degree of risk and may be highly volatile inresponse to fluctuations in interest rates or other market conditions. Foreign currency rates of exchange may adversely affect the value,price, or income of any security or related instrument referred to in this document. For investment advice, trade execution, or otherenquiries, clients should contact their local sales representative. The value of any investment or income may go down as well as up,and investors may not get back the full amount invested. Past performance is not necessarily a guide to future performance.

To the full extent permitted by law, neither Scotiabank nor any of its directors, employees or agents accepts any liability whatsoeverfor any direct or consequential loss arising from any use of the information or this document. Nothing in this document constitutesfinancial, investment, tax, accounting or legal advice. Investors should seek their own legal, financial and tax advice regarding theappropriateness of investing in any securities or pursuing any strategies discussed in the document. Any prices stated in this documentare for information purposes only and do not represent real-time valuations for individual securities or other financial instruments. Thereis no representation that any transaction can or could have been effected at those prices, and any prices do not necessarily reflectScotiabank's internal books and records or theoretical model-based valuations and may be based on certain assumptions. Differentassumptions by Scotiabank or any other source may yield substantially different results. All pricing of securities in reports is based onthe closing price of the securities' principal marketplace on the night before the publication date, unless otherwise explicitly stated.

The Research Analyst(s) responsible for the preparation of this document may interact with trading desk personnel, sales personneland other parties for the purpose of gathering, applying and interpreting market information.

In the normal course of offering investment and banking products and services to clients, Scotiabank may act in several capacities(including issuer, market maker, underwriter, distributor, index sponsor, swap counterparty, and calculation agent) simultaneously withrespect to a product, giving rise to potential conflicts of interest. Scotiabank uses controls such as information barriers to manageconflicts should they arise. Scotiabank and its affiliates, officers, directors, and employees may have long or short positions (includinghedging and trading positions), trade as principal and buy and sell in instruments or derivatives identified herein; such transactions orpositions may be inconsistent with the opinions expressed in this document.

Recipients of this document should expect that Scotiabank will from time to time perform services (including investment banking orcapital market services) in connection with the services and activities described in this document and that they may perform services forand engage in transactions with other market participants, including the issuers of certain of the investments underlying the transactionsherein.

The information in this document has been prepared without taking into account any investor's objectives, financial situation or needs,and investors should, before acting on the information, conduct independent due diligence when making an investment decision andconsider the appropriateness of the information, having regard to their objectives, financial situation and needs. For further information,please contact your sales representative.

Scotiabank specifically prohibits the redistribution of this document in whole or in part without Scotiabank's prior written permission, andScotiabank accepts no liability whatsoever for the actions of third parties in this respect. Images may depict objects or elements that areprotected by third-party copyright, trademarks and other intellectual property rights.

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Equity research reports published by Scotiabank are initially and simultaneously made available electronically to intended recipientsthrough its proprietary research website, ScotiaView, e-mail, and through third-party aggregators. The mediums in which researchis disseminated to clients may vary depending on client preference as to the frequency and manner of receiving research reports.Institutional clients with questions regarding distribution of equity research or who wish to access the proprietary model used to producethis report should contact Scotiabank at 1-800-208-7666.

A list of all investment recommendations in an equity security or issuer that have been disseminated during the preceding 12 months isavailable at the following location: www.gbm.scotiabank.com/disclosures.

Additional Disclosures

Australia: This report is provided in Australia by the Bank of Nova Scotia, an APRA-regulated Authorised Deposit-Taking Institution(Foreign Bank ADI) holding an Australian Financial Services License (AFSL).

Canada: Distributed to eligible Canadian persons by Scotia Capital Inc., a registered investment dealer in Canada.

Chile: This report is distributed by Scotia Corredora de Bolsa Chile Limitada, a subsidiary of The Bank of Nova Scotia.

Colombia: This report is distributed in Colombia by Scotiabank Colpatria, S.A. as authorized by the Superintendencia Financiera deColombia to The Bank of Nova Scotia (“Scotiabank”). Scotiabank and Scotia Capital Inc. promote and advertise their products andservices through Scotiabank Colpatria, S.A. This document does not contain any type of investment advice nor does it aim to provideadvice. This report is prepared by analysts employed by The Bank of Nova Scotia and certain of its affiliates, including Scotia CapitalInc.

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Japan: This research report is provided for information purposes only and it is not intended to solicit any orders for securitiestransactions or commodities futures contracts. While we believe that the data and information contained in this research report areobtained from reliable sources, we do not guarantee the accuracy or completeness of the data and information.

Mexico: The information contained in this report is for informational purposes only and is not intended to influence the decision of theaddressee in any way whatsoever with respect to an investment in a certain type of security, financial instrument, commodity, futurescontract, issuer, or market, and is not to be construed as an offer to sell or a solicitation of an offer to buy any securities or commoditiesfutures contracts. Scotia Inverlat Casa de Bolsa, S.A. de C.V., Grupo Financiero Scotiabank Inverlat, is not responsible for the outcomeof any investment performed based on the contents of this research report.

Peru: This report is distributed by Scotia Sociedad Agente de Bolsa S.A., a subsidiary of The Bank of Nova Scotia. This report isprepared by analysts employed by The Bank of Nova Scotia and certain of its affiliates, including Scotia Capital Inc.

Singapore: For investors in the Republic of Singapore, this document is provided via an arrangement with BNS Asia Limited pursuant toRegulation 32C of the Financial Advisers Regulations. The material contained in this document is intended solely for accredited, expertor institutional investors, as defined under the Securities and Futures Act (Chapter 289 of Singapore). If there are any matters arisingfrom, or in connection with this material, please contact BNS Asia Limited, located at 1 Raffles Quay, #20-01 North Tower, One RafflesQuay, Singapore 048583, telephone: +65 6305 8388.

This document is intended for general circulation only and any recommendation that may be contained in this document concerningan investment product does not take into account the specific investment objectives, financial situation, or particular needs of anyparticular person, and advice should be sought from a financial adviser based in Singapore regarding the suitability of the investmentproduct, taking into account the specific investment objectives, financial situation, or particular needs of any person in receipt of therecommendation, before the person makes a commitment to purchase the investment product.

BNS Asia Limited and/or its affiliates may have in the past done business with or may currently be doing or seeking to do business withthe companies or issuers covered in this report. The information provided or to be provided or actions taken by or to be taken by BNSAsia Limited and/or its affiliates in such circumstances may be different from or contrary to the discussion set out in this report.

United Kingdom and the rest of Europe: Except as otherwise specified herein, this material is distributed by Scotiabank Europe plcto persons who are eligible counterparties or professional clients. Scotiabank Europe plc is authorized by the Prudential RegulationAuthority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

United States: United States: Distributed to U.S. persons by Scotia Capital (USA) Inc. or by an authorized subsidiary or affiliate ofThe Bank of Nova Scotia that is not registered as a U.S. broker-dealer (a ‘non-U.S. affiliate’) to major U.S. institutional investors only.Scotia Capital (USA) Inc. accepts responsibility for the content of a document prepared by its non-U.S. affiliate (s) when distributedto U.S. persons by Scotia Capital (USA) Inc. To the extent that a U.S. person wishes to transact in the securities mentioned in thisdocument through Scotiabank, such transactions must be effected through Scotia Capital (USA) Inc., and not through a non-U.S.affiliate. The information in this document has not been approved, disapproved, or recommended by the U.S. Securities and ExchangeCommission (“SEC”), any state securities commission in the United States or any other U.S. or non-U.S. regulatory authority. None

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of these authorities has passed on or endorsed the merits or the accuracy or adequacy of this document. Any representation to thecontrary is a criminal offense in the United States.

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