Regional Thematic Report - RHB TradeSmart

Regional Thematic Report

See important disclosures at the end of this report 1

Market Dateline / PP 19489/05/2019 (035080)

18 September 2019

Finding Diamonds In The Rough

“Rough diamonds may sometimes be mistaken for worthless pebbles”

Thomas Browne

Our Best Investment Ideas

In this global environment characterised by uncertainty, volatility and complexity, we decided to dig for diamonds in the rough. The investment ideas we provide are a selection of stocks chosen by individual analysts following this criteria: 1. ROEs of 15% or above; 2. Increasing margins; 3. Trading below the average market multiples; 4. Reasonable corporate governance; 5. Net Debt/Shareholders’ Funds <0.5x. The table below shows our 13 “diamonds”.

Some See Coal, We See Diamonds

Source: RHB Our criteria used to discover the diamonds: 1. ROEs of 15% or above; 2. Increasing margins; 3. Trading below the average market multiples; 4. Reasonable corporate governance. 5. Net Debt*/Shareholders’ Funds <0.5x *Net Debt = ST debt + LT debt – Cash & equivalents

Table of Contents Our Diamonds from: Malaysia 2 Thailand 6 Singapore 8 Indonesia 13

Our methodology uses a fundamental bottom-up analysis, coupled with RHB’s on-the-ground insights.

Our sector analysts provided their assessments of the average market multiples for the respective sectors that the companies operate in. As one of the criteria is “trading below the average market multiples”, it means these stocks are out of favour currently.

In parallel, the list was further refined based on our assessments of each company’s potential to widen its margins, without compromising on ROE – while having reasonable corporate governance and low gearing.

Previous strong absolute returns. In our former four yearly “Diamonds In The Rough” reports, our search resulted in a list of stocks that exhibited strong absolute returns. Our findings this time have resulted in a list of 13 stocks shown below. This list represents companies that our analysts believe can have robust earnings growth due to sector- or company-specific reasons. In the table below, we show these companies ranked by market capitalisation.

We have BUY recommendations on all these counters, and our level of conviction is shown in their potential upside returns. As it takes a while for coal to turn into diamonds, we consider that – given time – all the companies in the list below should show healthy absolute returns.

The pages that follow describe why we consider these picks in our coverage universe to have “diamond”-type characteristics, presented by country.

Source: Company data, RHB (Data as of 10 September 2019)

Target P/E (x) P/BV (x) ROE (%)(LC) FY20F FY20F FY20F

Bank Mandiri 10,000 7,050 41.8% 23,413 10.2 1.5 15.5ST Engineering 4.70 3.90 20.5% 8,816 18.3 5.0 26.9Merdeka Copper Gold 7,220 6,025 19.8% 1,878 19.2 3.5 17.8Surya Citra Media 2,415 1,255 92.4% 1,319 10.4 3.1 31.1Supalai 23.50 18.50 27.0% 1,300 6.3 1.0 15.9Mitra Adiperkasa 1,300 1,025 26.8% 1,211 15.7 2.6 18.0Silverlake Axis 0.56 0.46 23.1% 872 15.8 5.1 32.2Dynasty Ceramic 2.50 2.04 22.5% 482 15.3 2.1 13.7Guan Chong 6.00 3.92 53.1% 449 8.5 1.8 23.9Power Root^ 2.49 2.07 20.3% 197 17.4 3.6 21.0Jumbo Group 0.47 0.39 22.0% 179 17.0 3.3 19.8JHM Consolidation 1.75 1.16 50.9% 155 12.1 2.6 23.2Kelington 1.63 1.26 29.4% 94 12.6 2.2 17.7

UpsideCompany Share price

Market cap (USDm)

Country heads (in alphabetical order):

Alexander Chia +603 9280 8889 [email protected]

Kasamapon Hamnilrat +662 862 9999 [email protected] Shekhar Jaiswal +65 6232 3894 [email protected]

Henry Wibowo +6221 2970 7056 [email protected]

mailto:[email protected]




Finding Diamonds In The Rough Regional Thematic Report

18 September 2019



Malaysia Figure 1: Diamonds from Kuala Lumpur

Note: Data as of 10 Sep 2019, ^FY19F-20F valuations refer to those of FY20F-21F Source: RHB, Bloomberg

Guan Chong (GUAN MK, BUY, TP: MYR6.00) GCB is the largest cocoa processor in Asia and joint 4th largest in the world. It has annual grinding capacity of 250k MT, including the recently acquired GCB Cocoa Malaysia’s (formerly known as Koko Budi) capacity of 50k MT per year. It was incorporated in 1990 and listed on Bursa Malaysia’s Main Market in 2005. The group provides cocoa-derived food ingredients such as cocoa liquor, cocoa butter, cocoa cake and cocoa powder to its customers, including several MNCs, through its wide distribution network and exports to more than 70 countries. It has two cocoa processing plants in Johor, Malaysia and Batam, Indonesia, cake grinding, butter deodorising and melting facilities in the US, and trading subsidiaries in Singapore and Indonesia. We are forecasting high ROEs of 23.9% and 23.2% for 2020 and 2021, to be backed by strong earnings growth from full utilisation of its new capacity, margin expansion from ability to sell more cocoa powder and improvement in operating efficiency. To ensure sustainability of future earnings growth, the company also plans to invest in a new plant in the Ivory Coast, which would increase its capacity by 60k MT pa to 310k MT pa. The new plant is expected to be commissioned starting 1Q21. GCB’s margins have improved significantly in the past two years, as it is now in a better position to sell its cocoa powder at a greater margin, due to its expertise in developing the taste, texture and colour profiles to match customer demand. The wider usage of cocoa powder in beverages, chocolates and confectionery also contributed to the growing demand. With its good track record and familiar brand name in the market, the group has managed to penetrate the supply chain of several MNCs (such as Nestlé, Mars and Hershey’s) and this would provide some stability for its earnings base. Trading below sector valuation at 8.5x FY20F P/E, a 19% discount compared to its customers based in Malaysia ie Cocoaland (COLA MK, BUY, TP: MYR3.10) and Apollo Food (APOF MK, NEUTRAL, TP: MYR3.65), given the indirect exposure (mid-stream) to consumer spending. It also trading at a hefty discount compared to international direct peers such as Barry Callebaut, Olam International and Fuji Oil, which are trading at an average P/E of 25x. Reasonable corporate governance. The group has managed to apply the principles, while the extent of compliance is within the best practices advocated by the Malaysia Code on Corporate Governance (MCCG). We are not aware of any corporate governance issues. Risks to our recommendation include volatility of cocoa bean prices, FX movements, regulatory risk, and loss of key management.

♦ Lee Meng Horng +603 9280 8866 [email protected]

♦ Muhammad Afif Bin Zulkaplly +603 9280 8883 [email protected]

Figure 2: Shareholding structure Figure 3: EBITDA yield and ROE

Notes: *Company controlled by Brandon Tay (CEO), also partly owned by Alan Tay (COO) and Hia Cheng (CFO) **Company controlled by Dato Dr Mohamad Musa bin Md Jalil (Chairman). Source: Company data, RHB

Source: Company data, RHB

TargetFY19F FY20F FY19F FY20F FY19F FY20F FY19F FY20F FY19F FY20F

Guan Chong GUAN MK BUY 6.00 3.92 449.2 9.7 8.5 2.3 1.8 5.2 5.3 25.8 23.9 7.1 7.7 JHM Consolidation JHMC MK BUY 1.75 1.16 155.1 14.7 12.1 3.1 2.6 9.7 7.9 22.3 23.2 13.9 14.5 Kelington KGRB MK BUY 1.63 1.26 93.7 15.8 12.6 2.5 2.2 8.6 6.8 18.1 17.7 5.4 5.4 Power Root^ PWRT MK BUY 2.49 2.07 196.6 19.8 17.4 3.7 3.6 13.7 11.5 18.9 21.0 10.9 11.7

Net margin (%)Company Ticker Rating Share price

Market cap (USDm)

P/E (x) P/BV (x) EV/EBITDA (x) ROAE (%)




18 September 2019



Figure 4: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or directors been involved in a legal case in the past 7 years No √

2 Has the company or any of the directors been subjected to sanction, investigation by the Securities Commissions and/or Bursa Malaysia in the past 7 years No √

3 How frequent was the change in auditor in the past 7 years 1 √

4 Ease of management access/openness in engaging with the public and investors such as small group meetings, briefings, NDRs and etc. Yes √

5 The number of earnings surprise on the negative side in the last 5 years. 1 √

Source: RHB

JHM Consolidation (JHMC MK, BUY, TP: MYR1.75)

JHM provides one-stop engineering solutions: it designs, manufactures and assembles high brightness light emitting diodes (HB LED), direct current (DC) micromotor components; it is an original design manufacturer (ODM) of LED components, pitch connector pins, precision miniature engineering metal parts and components and electronic components using surface-mount technology. Its products can be found in all sub-segments of the electronic components industry and are used in electronic devices such as digital cameras, mobile phones, and automobile lighting. FY19 a record earnings year in the making. After the solid 1H19 results, it is on course to achieve a record earnings year (+33% YoY). The strong growth trajectory should be fuelled by margin improvements (1H19 net margin improved to 13.2% from 10%), maiden contributions from new segments like life sciences and aerospace, and higher contribution from the newly-acquired MACE instrumentation. The recent plant expansion to 200,000 sqf from 80,000 sqf for Mace, catering for large-scale equipment metal enclosure orders from a US test and equipment company, should contribute starting from 4Q, along with income from the aerospace segment. We expect the automotive segment to be stable, with commencement of new projects cushioning the impact of certain volume loss due to slower demand and the tail-end of the product cycle. Venturing into aerospace a re-rating catalyst. JHM is embarking on a multi-year exponential growth venture with Universal Alloy Corp Europe (UACE). This venture will potentially anchor a sustainable earnings base over the next 10 years, given the overall stability in the aerospace industry. JHM is targeting revenue composition of 41%, 40%, and 19% for its aerospace, automotive and industrial divisions in 3-5 years’ time (from 0%, 72% and 28%). Undemanding valuation at 12x FY20F P/E vs 5-year P/E average of 17x for the Bursa Malaysia Technology Index. We believe the stock trades at an undemanding valuation given the new aerospace venture; the expansion for its metal enclosure business starting to bear fruit; and relatively stable earnings from its automotive segment. Note that the company also targets to transfer to the Main Board by end-2019/early 2020. Balance sheet remains healthy with FY19F ROE of 22.6%, net gearing of 5.9%, and a potential yield of 2.2%. Reasonable corporate governance. The group has managed to apply the principles, while the extent of compliance is within the best practices advocated by the Malaysia Code on Corporate Governance (MCCG). We are not aware of any corporate governance issues. Risks to our recommendation include lower-than-expected demand, stronger-than-expected MYR and delays in commissioning new product lines.

♦ Lee Meng Horng +603 9280 8866 [email protected]

Figure 5: Shareholding structure Figure 6: Margins and ROE profiles

Source: Company data, RHB Source: Company data, RHB

Dato' Tan King Seng

33%

Noble Matters

15%

Cheah Choon Ghee

1% Ong Hock Seong

2%

Others 49%

5.0

10.0

15.0

20.0

25.0

30.0

2017 2018 2019F 2020F 2021F

EBITDA Margin(%) ROE (%) NPM (%)



18 September 2019



Figure 7: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) F 1 Has the company or directors been involved in a legal case in the past 7 years No √

2 Has the company or any of the directors been subjected to sanction, investigation by the Securities Commissions and/or Bursa Malaysia in the past 7 years No √

3 How frequent was the change in auditor in the past 7 years Nil √



Source: RHB

Kellington Group (KGRB MK, BUY, TP: MYR1.63)

Kelington Group (KGB) is primarily engaged in the provision of ultra-high purity (UHP) gas delivery systems, the processing of industrial gases, process engineering and general contracting services. New leg of growth from the industrial gas (IG) business. KGB’s liquid CO2 (LCO2) plant (located in Kerteh, Terengganu and adjacent to Petronas’ gas processing plant) is on track to be commissioned by 4Q19, with a rated production capacity of 50,000 tonnes pa. We see the production and sales of LCO2 driving a new leg of growth for the company, with KGB emerging as a key challenger in the lucrative industrial gas market. KGB’s fleet of new tankers and efficiencies gained from the new production facility should allow it to chip some market share away from its leading competitor, Linde Malaysia. Expect EBITDA margin to further improve, supported by better revenue mix, specifically from the commencement of LCO2 production and value-added hook-up and commissioning jobs in Singapore. We see upside risk to our forecasts should margins continue to expand. 1H19 core EBITDA margin widened to 8.8% from 7.6% in 1H18 (FY18: 9%). We gather from management that existing UHP contracts from Singapore yield better margins than those from Taiwan and China. ROE of above 15%. On the back of stronger EBITDA margin, we expect the company to sustain its ROE at above 15% going forward. It is worth noting the company has a net cash balance of MYR70.2m as at 2Q19. Valuations remain attractive at below small cap average prospective P/E of 15.6x. Kelington currently trades at 13.2x FY20F EPS, which in our view is undemanding, considering the fairly attractive 2-year EPS CAGR of 21% and its strong balance sheet. Earnings growth prospects are supported by an entrenched orderbook of MYR315m (2Q19) and tenderbook in excess of MYR1bn. Reasonable corporate governance. Crowe has been Kelington’s independent auditor since its IPO in 2009. We believe KGB’s founder and management team have their interests aligned with the shareholders of the company, with a 29% stake held through a holding company – Palace Star. More recently, Soh Tong Hua, the director of Kelington’s industrial gas business arm, became a substantial shareholder through Palace Star. Additionally, out of its six board members, four are independent non-executive directors. Risks to our recommendation include a prolonged US-China trade war, weaker orderbook replenishment, lower margins and management execution.

♦ Jeffrey Tan +603 9280 8863 [email protected]

Figure 8: Shareholding structure Figure 9: Chart margins and ROE

Source: Company data, RHB Source: RHB

0%

5%

10%

15%

20%

25%

30%

35%

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

9.0%

2017 2018 2019F 2020F 2021F

EBITDA margin (LHS) ROE (RHS)

Sun Lead International

Limited 7%

Institutional Investors

40%

Public float 28%

Soh Tong Hua (Director of Ace Gases)

5%

Steven Ong Weng Leong

(COO) 5%

Raymond Gan Hung Keng

(Chairman/CEO) 5%

Cham Teck Kuang

5%

Hu Keqin 5%

Palace Star [PERCENTAGE

]


18 September 2019



Figure 10: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or directors been involved in a legal case in the past 7 years No √ 2 Has the company or any of the directors been subjected to sanction, investigation by

the Securities Commissions and/or Bursa Malaysia in the past 7 years No √

3 How frequent was the change in auditor in the past 7 years Nil √ 4 Ease of management access/openness in engaging with the public and investors such

as small group meetings, briefings, NDRs and etc. Yes √

5 The number of earnings surprise on the negative side in the last 5 years. Nil √

Source: RHB

Power Root (PWRT MK, BUY, TP: MYR2.49) Power Root was founded on 23 Jul 1999 in Johor Bahru, Johor. It is a leader in developing and promoting herbal energy drinks fortified with two main rainforest herbs: Eurycoma longifolia, commonly known as Tongkat Ali; and Labisia Pumila and Pathoina, or Kacip Fatimah. These herbs are indigenous to Malaysia and their properties for promoting physical well-being are highly regarded by Malaysians. Today, the company has a portfolio of six brands targeting key market segments, namely Alicafe, Ah Huat, Alitea, Oligo, Per’l and Extra Power Root. The group also has presence in more than 40 countries around the globe. We forecast commendable ROEs of 18.9% and 20.9% in FY20 and FY21 vs 16.2% in FY19. We believe this will be driven by sustainable earnings growth on the back of healthy sales growth, favourable raw material prices, and higher operating efficiency. Looking forward, management is targeting 10% topline growth in FY20, with both local and export sales expected to chip in. This should be driven by new product launches, and continued restructuring in distribution and its dealer network. Meanwhile, the company is banking on a more effective tracking system to improve the efficiency of its ordering system and inventory management. Margin expansion should be underpinned by the favourable movement of key raw material prices, whilst management remains prudent in A&P investment. We forecast decent prospective dividend yields of 4.3%, 4.8%, and 5.6% for FY20-22. These would be supported by healthy operating cash flow, minimal capex requirements and a sturdy balance sheet. Trading below sector valuation at 17x CY20F P/E vs 38x for its FMCG peers. We believe the sizeable discount (>50%) can be attributed to the group’s relatively smaller market capitalisation and profit base. Reasonable corporate governance. The group has managed to apply the principles, while the extent of compliance is within the best practices advocated by the Malaysia Code on Corporate Governance. We are not aware of any corporate governance issues; there were three instances of earnings surprise on the negative side though. Risks to our recommendation include lower-than-expected sales and higher-than-expected input costs.

♦ Soong Wei Siang +603 9280 8865 [email protected]

Figure 11: Portfolio of brands Figure 12: ROE and NPM comparison

Source: Company data, RHB Source: RHB

Figure 13: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or any of the director involved in a legal case in the past 7 years No √

2 Has the company or any of the director subject to sanction, investigation by the Securities Commissions and/or Bursa Malaysia in the past 7 years No √


4 Ease of management access/openness in engaging public and investors such as small group meetings, briefings, NDRs and etc. Yes √

5 The number of earnings surprise on the negative side in the last 5 years. 3 X

Source: RHB

0.0%5.0%

10.0%15.0%20.0%25.0%

FY18 FY19 FY20F FY21F FY22F

ROE Net profit margin


18 September 2019



Thailand Figure 14: Diamonds from Bangkok

Note: Data as at 10 September 2019 Source: RHB, Bloomberg

Dynasty Ceramic (DCC TB, BUY, TP: THB2.50)

Dynasty Ceramic is a manufacturer and distributor of ceramic floor and wall tiles under the Dynasty, Tomahawk, Jaguar, and Nava brands. It purchases ceramic floor, wall, and decorative tiles from its Tile Top Industry subsidiary. In addition, Dynasty acts as a nationwide distributor through units Pick & Pay, Muangthong Ceramic, and World Wide Ceramics. ROE on the verge of increasing in FY21. The company’s abnormal high ROEs of over 40% during the past seven years (2010-2016) was due to strong net margins (16-20%) and consistent dividend payments forked out at a payout ratio of 100%. However, it began to decline in FY17 to below 30%, as the dividend payout was revised down to 75%. We expect ROE to decline further to less than 20% this year, as there was an equity expansion via a warrant conversion, which is set to occur every May until May 2021. While Dynasty is maintaining the dividend payout at 75%, we expect the warrant conversion to finance its tender offer plan for Royal Ceramic Industry (RCI) (RCI TB, NR) within this year, as well as the expansion of the company’s community mall project – the latter should provide Dynasty with its core recurring income in the long term. Although ROE has declined to the sector average (12-14%), ROE will resume its rising trend from FY21 onwards, due to higher contributions from RCI. Profit margin improvements in the near term. The company’s GPM is already on the rise, as Dynasty can recover RCI’s operations – this success can be seen in the latter’s FY18 profit turnaround. We expect RCI’s stronger momentum and change in product mix towards high value-added offerings to enhance Dynasty’s GPM this year. Additionally, the company’s NPM should resume its rise in FY20 due to the ongoing stronger GPM and higher contributions from RCI post the tender offer. Trading below its historical level and sector average. At the current THB2.04 share price, Dynasty’s P/E is below its 15-year historical average, as well as the industry mean (16x). We believe the share price should be trading at a more premium level, as the company is approaching a stage of strong improvement. Reasonable corporate governance. Dynasty is a family-owned company founded by Roongroj Saengsastra. Saengsastra has more than 30 years of experience in the ceramic tiles industry and is currently Dynasty’s largest shareholder. Yet, despite being a family-owned entity, the company’s corporate governance is currently rated as “Very Good” by the Thai Institute of Directors. We are not aware of any corporate governance issues; there were five instances of earnings surprise on the negative side though. Downside risks to our recommendation include weaker-than-expected purchasing power in rural areas and rising cost of energy used in the production and logistics processes.

♦ Chatree Srismaicharoen +662-088-9743 [email protected]

Figure 15: Thailand’s highly-populated regions are major markets for the company

Figure 16: ROE and profit margin comparisons

Source: Company data Source: RHB

TargetFY19F FY20F FY19F FY20F FY19F FY20F FY19F FY20F FY19F FY20F

Dynasty Ceramic DCC TB BUY 2.50 2.04 482.1 14.2 15.3 2.5 2.1 9.1 9.2 17.9 13.7 12.2 12.9 Supalai SPALI TB BUY 23.50 18.50 1,300.0 6.7 6.3 1.1 1.0 7.2 7.0 16.6 15.9 21.1 20.6

P/BV (x) EV/EBITDA (x) ROAE (%) Net margin (%)Company Ticker Rating Share price

Market cap (USDm)

P/E (x)


18 September 2019



Figure 17: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or directors been involved in a legal case in the past seven years. No √ 2 Has the company or any of the directors been subjected to sanction, investigation by the

Securities & Exchange Commission and/or SET in the past seven years. No √

3 How frequent was the change in auditor in the past seven years. 1 √ 4 Ease of management access/openness in engaging public and investors such as small

group meetings, briefings, NDRs, etc. Yes √

5 The number of earnings surprise on the negative side in the last five years. 5 X

Supalai (SPALI TB, BUY, TP: THB23.50) Supalai is a residential developer focused on mid- to low-end products in Bangkok and the upcountry. The company and its subsidiaries develop a variety of residential projects such as detached houses duplex houses, townhouses and condominiums in Bangkok and its vicinity as well as 12 other provinces nationwide. It also develops/operates offices, hotels and resorts. ROE and handsome dividend payment. Historically, its ROEs used to be higher than 20x. After equity raising in 2018, however, ROE dipped below 20x. Moving forward, we still expect its ROE to stay around 15-16% pa based on a dividend payout ratio of 20%. To drive ROE, it may consider increasing the payout ratio, now that net gearing is lower than 50%. We note that its dividend yield (at the current price) is already high, at over 6% pa. Above industry-average margins. Over the past five years, Supalai’s gross and net margins have averaged 37-42% pa. and 22-24% pa. These are meaningfully above the average of large listed developers under our coverage, which average 33-35% pa in gross margins and 15-18% pa in net margins. Trading below historical level. At its current share price (THB18.50), Supalai’s P/E of 6-7x is at -1SD below its long-term mean of 9x. Our TP of THB23.50 is pegged ti 8x 2020F P/E, -0.5 SD below its long term mean P/E. Excellent corporate governance. Supalai, founded 30 years ago by Prateep Tangmatitham, is now run by a second-generation member, Tritecha Tangmatitham. In spite of it being a family-owned entity, its corporate governance is currently rated as “Excellent” by the Thai Institute of Directors. Downside risks to our recommendation include a weak macro-economic outlook, banks' strict lending measures with stricter loan-to-value rules, high household debt, and fierce competition. However, should the Government release more effective new property stimulus, Supalai, which targets the mass market, should see some upside surprise.

♦ Wanida Geisler +662-088-9748 [email protected]

Figure 18: 5-year presales and realised sales Figure 19: ROE and profit margin comparison

Source: Company data Source: Company data, RHB

Figure 20: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or directors been involved in a legal case in the past seven years. No √ 2 Has the company or any of the directors been subjected to sanction, investigation by the

Securities & Exchange Commission and/or SET in the past seven years. No √

3 How frequent was the change in auditor in the past seven years. No √ 4 Ease of management access/openness in engaging public and investors such as small

group meetings, briefings, NDRs, etc. Yes √

5 The number of earnings surprise on the negative side in the last five years. 1 √ Source: RHB


18 September 2019



Singapore Figure 21: Diamonds from Singapore

Note: Data as at 10 Sep 2019 Source: Bloomberg, RHB

Jumbo (JUMBO SP, BUY, TP: SGD0.47)

Jumbo is a multi-dining concept food & beverage (F&B) company. It has a network of F&B outlets across Singapore and China. The group also has franchises throughout Asia. Its key brands include Jumbo Seafood, Ng Ah Sio Bak Kut Teh, Chui Huay Lim, Zui Yu Xuan, Chao Ting, and Tsui Wah. Store expansion to drive earnings growth. Jumbo Seafood is Jumbo’s single-largest earnings driver, contributing c. 60% of revenue in FY18. Well-known for its chilli crabs, Jumbo Seafood’s strong brand equity in Singapore enables it to consistently deliver positive SSSG. Each new outlet typically breaks even in less than six months. Given that the group has opened two new Jumbo Seafood restaurants at Ion Orchard and Changi Airport Jewel this year, we expect the new stores to contribute positively to FY19F-20F earnings growth. Jumbo also launched two new Teochew cuisine restaurants – Zui Yu Xuan and Chao Ting – in April. Located at Singapore’s central business district, these brands help to diversify its customer base by targeting the business dining and office lunch crowd. We expect these outlets to ramp up and break even by next year. Moving into FY20, the group’s expansion plans include bringing its Ng Ah Sio Bak Kut Teh brand into China and opening more Tsui Wah outlets in Singapore. More franchisees, better margins. Jumbo has franchised out its Jumbo Seafood and Ng Ah Sio Bak Kut Teh brands. Over the last 12 months, its franchisees have expanded by another five outlets, bringing the total number of franchised outlets to seven. In addition, its South Korean franchisee is likely to open a new outlet in the upcoming quarter, with the second store set to open in the next 12 months. Its franchisee also expects one more Ng Ah Sio Bak Kut Teh in Taiwan. While franchise income is small relative to revenue, we believe it will help boost Jumbo’s FY19F-20F operating margins. One of the few F&B brands that consistently generates positive SSSG. With the increase in F&B establishments in Singapore, we note that most F&B services firms are growing sales through store expansion. Only a few can generate SSSG, especially in a slowing economy environment. Jumbo Seafood is one of the few brands in Singapore that has consistently generated positive SSSG – c.3-5% – even when F&B revenue in the country was stagnant. In the country’s restaurant scene, Jumbo Seafood has been a household name for a long time. It remains a popular dining choice for festivities, family gatherings, and special occasions, such as Mother’s Day. It is also a reputable and reliable brand for tourists to try the highly-recommended local delicacy, chilli crab. Expanding margins and financial leverage to drive ROE expansion. We expect Jumbo’s ROE to expand to 21.3% by 2021 from 16.9% in 2018 on higher operating margins and improving capital turnover. Margins improvement should be driven by the closure of underperforming stores, expansion of its franchisee network, and opening of more Jumbo Seafood restaurants in Singapore, which yield better profitability vis-à-vis its other brands. We estimate the group’s operating margins to grow to 9.6% in 2021 from 8.9% in 2018. Separately, the maturing of its new restaurants should also drive higher capital turnover over the next three years. We project Jumbo’s sales to expand at a CAGR of 11% over FY18-21. Good corporate governance track record. Based on our internal checklist, we assess the group as having a good corporate governance track record (Figure 24). Valuations remain compelling. The stock is trading at FY19F P/E of 19x and 10x EV/EBITDA, which well below its peer average of 23x P/E and 13x EV/EBITDA. This is in spite of its superior growth outlook (earnings CAGR of 15% over FY18-21), and better ROE and yields. Some key downside risks: The tightening of foreign workers’ dependency ratio ceiling in Singapore’s service sector should affect the labour-intensive restaurant segment. Continued entrance of strong F&B players, such as Hai Di Lao, is also likely to dilute Jumbo Seafood’s share of mind when it comes to dining choices for festivities or family occasions. The slowdown in China’s economy could affect Jumbo’s operations there.

♦ Juliana Cai +65-6232-3871 [email protected]

Target1FY 2FY 1FY 2FY 1FY 2FY 1FY 2FY 1FY 2FY

Jumbo Group JUMBO SP Buy 0.47 0.39 178.8 Sep-19 20.6 17.0 3.4 3.3 10.3 8.7 17.4 19.8 7.3 7.4 Silverlake Axis SILV SP Buy 0.56 0.46 872.3 Jun-20 16.8 15.8 5.6 5.1 10.9 10.3 33.6 32.2 28.3 28.3 ST Engineering STE SP Buy 4.70 3.90 8,815.7 Dec-19 20.1 18.3 5.3 5.0 13.2 11.8 25.5 26.9 7.8 8.1

1FY year end

Company Ticker Rating Share price

Market cap (USDm)

P/E (x) P/BV (x) EV/EBITDA (x) ROAE (%) Net margin (%)


18 September 2019



Figure 22: Jumbo Seafood’s sales growth has consistently beaten the industry average

Figure 23: Jumbo’s ROE outlook

2017 2018 2019F 2020F 2021F

Op margin (EBIT/sales) 0.12 0.09 0.08 0.09 0.10

Capital turnover (sales/assets) 1.74 1.74 1.83 2.05 2.06

Financial cost ratio (PBT/EBIT) 1.00 1.00 1.00 1.00 1.00 Financial structure ratio (Assets/shareholder's equity) 1.22 1.27 1.25 1.27 1.27

Tax effect ratio (net profit/PBT) 0.81 0.82 0.89 0.86 0.83

Return on equity check: 22.2% 16.9% 17.4% 19.8% 21.3%


Figure 24: Corporate governance checklist No Questions (*on both corporations and directors) Respond Flag (X)

1 Has the company or any of the director been subjected to sanction, investigation by the Monetary Authority of Singapore and/or SGX in the past seven years No √

2 Has the company or any of the directors been involved in a legal case in the past seven years No √ 3 How frequent was the change in auditor in the past seven years 0 √

4 Ease of management access/openness in engaging with the public and investors such as small group meetings, briefings, non-deal roadshows, etc Yes √

5 The number of earnings surprise on the negative side in the last five years. 2 √

Source: RHB

Silverlake Axis (SILV SP, BUY, TP: SGD0.56)

Silverlake Axis provides customised software solutions. The company delivers digital economy software solutions and services to the banking, insurance, payment, retail and logistics industries. With the improving fundamentals and stronger earnings growth as at FY19, Silverlake is on track for a decent FY20 but PATMI will likely be impacted by higher effective tax rates. We forecast commendable ROEs of 33.6% and 32.2% in FY20F and FY21F as we believe earnings growth will be driven by margins improvement from higher licensing revenue, as the company continued to implement the large sized Malaysian contract. It is also in the midst of securing a few large sized contracts from banks in South-East Asia and securing any of these will be positive to earnings in the next 2-3 years. MYR300m orderbook with potential large sized contract wins pending. As at end-FY19, orderbook stood at MYR300m, up from MYR280m. With banks budgeting for more IT investments, especially in Indonesia and Thailand, we understand management is actively in talks with a few potential new and existing customers. Silverlake is also confident of securing additional large sized contracts by end-2019 – this should further contribute towards its PATMI growth in FY20F-21F. Higher dividend payout in FY20F. Management said it is keen on rewarding shareholders with better dividends. We believe Silverlake will likely conduct more share buybacks, similar to 2019 – this should be positive for the company. As at 2HFY19, it declared a total of 1.1 SG cents. For FY20F, management guided that it will likely look to increase the payout ratio. Historically, the company has paid out >80% of earnings. Due to the share buybacks previously, we expect the payout ratio for FY20F to be 60-70%, resulting in FY20F yield of 6.5%. Reasonable corporate governance. The group has managed to apply the principles, while the extent of compliance is within the best practices advocated by the Malaysia Code on Corporate Governance (MCCG). We are not aware of any corporate governance issues. Risks to our recommendation include: economic recession and slowdown in banks’ capex spending, higher tax rates.

♦ Jarick Seet +65-6232-3891 [email protected]

♦ Lee Cai Ling +65-6232-3892 [email protected]

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18 September 2019



Figure 25: Shareholding structure Figure 26: ROE and NPM comparison

Source: Bloomberg Source: Company data, RHB

Figure 27: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X)


2 Has the company or any of the directors been involved in a legal case in the past seven years No √

3 How frequent was the change in auditor in the past seven years 1 √

4 Ease of management access/openness in engaging with the public and investors such as small group meetings, briefings, non-deal roadshows, etc. Yes √


Source: RHB

ST Engineering (STE SP, BUY, TP: SGD4.70)

ST Engineering is an integrated engineering group that has business a presence in the Aerospace, Electronics, Land Systems, and Marine sectors. STE has, over the years, diversified its businesses and geographical coverage. As at 2018, more than 80% of its profits came from the Aerospace and Electronics businesses. The Land Systems and Marine divisions, which – at their peak – used to account for more than 30% of net profit, have seen their contributions drop to less than 20% last year amidst a weak business environment. Investment thesis Contributions from recently-completed and upcoming acquisitions – a key earnings growth catalyst. Middle River Aerostructure Systems (MRAS), which specialises in the production of engine nacelle systems and their thrust reversers, was acquired by STE from General Electric in April. MRAS made material positive contributions to the group’s recently-announced 2Q19 revenue and net profit – with only two months of contributions. MRAS’ contributions to STE are expected to remain earnings accretive despite accounting for c.SGD10m in integration costs in 2H19 and 2020. The group also remains confident of completing the Newtec acquisition by 2H19. We expect the latter to start contributing to earnings from FY20. Strong orderbook and revenue visibility. STE reported an all-time high outstanding orderbook of SGD15.6bn, of which SGD3.8bn will be delivered in 2H19. The orderbook provides revenue visibility for close to 2.5 years. Including the SGD1bn contract for the design and construction of the first Polar Security Cutter, the group has reported order wins worth SGD4.6bn in 1H19. By comparison, reported order wins in 2018 stood at SGD5.2bn. STE’s diversified businesses makes it relatively less prone to near-term risks from the ongoing trade war. Although the group’s growth remains exposed to global economic cycles, its business and geographic diversity – as well as the long-term nature of its contracts – ensure that STE’s revenue remains relatively shielded from the short-term uncertainties created by the escalation in trade tensions between the US and China. Moreover, two-thirds of the group’s growth over the next five years is expected to come from overseas business operations.

♦ Shekhar Jaiswal +65-6232-3894 [email protected]

Goh Peng Ooi 66%

Ntasian Discover

y M 5%

Others 29%

0.05.0

10.015.020.025.030.035.040.045.0

Jun-18 Jun-19 Jun-20F Jun-21F Jun-22F

ROE Net Profit Margin


18 September 2019



Building long-term capabilities in Aerospace, STE’s largest earnings contributor. The group is now the world’s leading global airframe MRO service provider, as measured by biennial rankings conducted by Aviation Week Network. It has been, over the years, expanding its presence and building capabilities in this business. STE has invested in a European passenger to freighter conversion business and recently completed the acquisition of a US aircraft engine nacelle manufacturer – MRAS. During the last few months, the group has announced the setting up of a JV company with Vietnam Airlines to provide component MRO services in Vietnam. It has also signed a long-term collaboration agreement with Honeywell to act as a licensed repair centre for the latter’s components and collaborated with Air New Zealand to trial the use of drones for inspecting aircraft undergoing maintenance checks at STE’s Changi Airport facility. With its growing business presence, we believe the group will be well poised to derive benefits across the whole value chain of a growing global aviation industry. Making progress on Smart Nation initiatives. Rapid urbanisation and an ageing population has created a need for Smart City technologies to be implemented. The latter requires people-centric, built-to-design, and custom-made solutions to address each city’s unique requirements – from demographics and physical to social and economic conditions. STE offers Smart City technologies through its suite of Smart Mobility, Smart Security, and Smart Environment solutions. The group has already implemented more than 500 Smart City projects across 70 cities worldwide, and expects revenue from this business to double by 2022 from SGD1bbn in 2017. In Singapore, STE is setting up collaborations and working with government bodies to enhance its Smart City capabilities. It recently signed a MoU with Singapore’s National Water Agency to develop and leverage digital technologies that will enhance the latter’s intelligent water management systems and operations. STE has also inked a MoU with SBS Transit and SMRT Trains to foster greater knowledge-sharing and grow local rail maintenance and engineering capabilities. Earlier this year, the group received its first contract to supply 80 automated guided vehicles (AGVs) to Singapore’s container port operator, PSA Corp, and integrate the AGVs into the operations of PSA’s next generation port in Tuas. STE is also conducting trials for on-demand autonomous shuttle bus services on Sentosa Island.

Why the stock is a “diamond in the rough” Expanding margins and financial leverage to drive the ROE expansion. We expect STE’s ROE to expand to 27.7% by 2021 from 23.6% in 2018. This expansion will be driven by improving profit margins and rising financial leverage. The group’s recent acquisition of MRAS was funded by debt and we expect STE to raise additional debt to fund the upcoming Newtec acquisition. We estimate the group’s net debt to equity to rise to 0.63x in 2019 from 0.04x in 2018. With a rising cash balance, this should gradually taper off to 0.39x in 2021 (Figure 31 – reference to ROE table below). Margins improvement should be driven by Aerospace. We expect the Aerospace business to drive margins expansion during the forecast period. Based on our estimates, much of this expansion will be driven by profit contributions from the recently-acquired MRAS. We estimate STE’s net profit margin to expand to 8.4% in 2021 from 7.9% in 2018. Good corporate governance track record. Based on our internal checklist, we assess STE to have a good corporate governance track record (Figure 32 - reference to STE’s CG checklist table below). The flag raised was related to a legal case on some its ex-executives. In 2017, former ST Marine group financial controller Ong Teck Liam and six other former ST Marine senior executives were convicted for corruption in a scandal that broke in 2014. Valuations remain compelling. Following the recent weakness in STE’s share price, the stock is now trading at 20.8x 2019F P/E, which is below its 3-year average of 23.3x. We value this counter on blended valuations, which is an average of P/E, P/BV, EV/EBITDA, and DCF. The WACC is based on a medium-term risk-free rate of 2.2%. We use the Monetary Authority of Singapore’s 10-year bond yield as a proxy for the risk-free rate, which – at the time of writing – was trading at a yield of 1.7%. Some key downside risks: Failure to sustain current strong order wins, an increase in MRAS’ integration cost, delays in the Newtec acquisition, and an unfavourable outcome for Halter Marine’s arbitration.


18 September 2019



Figure 28: STE’s net profit and margin outlook Figure 29 STE ROE outlook

2016 2017 2018 2019F 2020F 2021F

Net profit margin (%) 7.2 7.4 7.9 7.8 8.1 8.4

Asset turnover (x) 0.8 0.8 0.9 0.9 0.8 0.8

Equity multiplier (x) 3.8 3.7 3.5 3.7 4.0 3.9

ROE (%) 22.5 21.9 23.6 25.5 26.9 27.7


Figure 30: Corporate governance checklist No Questions (*on both corporations and directors) Respond Flag (X)


2 Has the company or any of the directors been involved in a legal case in the past seven years Yes X 3 How frequent was the change in auditor in the past seven years 0 √

4 Ease of management access/openness in engaging with the public and investors such as small group meetings, briefings, non-deal roadshows, etc Yes √


Source: RHB

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18 September 2019



Indonesia Figure 31: Diamonds from Jakarta

Note: Share price and market cap data as at 10 Sep 2019 Source: Bloomberg, RHB

Bank Mandiri (BMRI IJ, BUY, TP: IDR10,000)

Bank Mandiri is a state-owned bank and Indonesia’s second largest bank by asset, with IDR1,235trn as of 1H19 and diversified lending focus in the corporate (both SOE and non SOE), SME, retail, micro, and Shariah segments (which is undertaken by its subsidiary, Bank Syariah Mandiri). The company was established in 1998 to restructure the national banking sector, with four state-owned banks (Bank Bumi Daya, Bank Dagang Negara, Bank Ekspor Impor Indonesia, and Bank Pembangunan Indonesia) merged into Bank Mandiri in 1999. ROE of 15.1-15.9% in FY19-21F vs 14.4 in FY18. For this year, we believe Mandiri’s earnings will be driven by potentially better credit cost as management expects to see some improvement in asset quality in the coming quarters. Mandiri’s NPL was down from a high 4% in 2016 to 2.8% in FY18, and then was further brought down to 2.6% in 6M19 as the bank continuously assessed its risk management, especially in the micro and SME segments. With the current improvement in asset quality, we forecast that credit cost will hover around 1.5% in FY19-20F, aligned with management’s target. Coupled with expanding NIM as Indonesia starts to cut interest rates, we expect Mandiri’s earnings CAGR at 13.3% CAGR for FY18-FY21F. Expanding NIM from a dovish rate outlook. We believe the banking sector in Indonesia, including Mandiri, will benefit from a more dovish rate outlook. Bank Indonesia has cut the 7-day reverse repo rate by 25bps, and we believe the central bank will decrease rates one more time by the end of 2019. Although interest expenses have risen by 27% YoY during 1H19 due to the 175bps rate hike during 2018, combined with tightening liquidity in the industry, we believe the surge has reached its peak as credit costs should normalise down after July, as banks will adjust their rates to the benchmark rate. We forecast NIM to hover around 5.2-5.3% in FY19-21F. Trading at a discount vs peers. Mandiri is currently trading at 1.5x FY20F P/BV, lower than Bank Central Asia’s (BBCA IJ, NEUTRAL, TP: IDR32,500) expensive valuation of 4.2x P/BV while Bank Rakyat Indonesia (BBRI IJ, BUY, TP: IDR5,000) is trading at 2.5x P/BV. We believe the recent pressures over defaulting corporates on SOE loan books have been overdone. This presents an attractive buying opportunity for Bank Mandiri, among other SOE banks. Corporate governance. Republic of Indonesia owns 60% of Mandiri. All the directors and commissioners sitting on its boards are selected by the Ministry of State Owned Enterprises, with direct approval of the Indonesian president. A typical SOE usually rotates its leaders every five years, and usually, all directors and commissioners are professionals from respected sectors, and independent from political party influences.

♦ Henry Wibowo +62 21 2970 7056 [email protected]

♦ Christopher Andre Benas +62 21 2970 7066 [email protected]

Figure 32: Bank Mandiri’s loan book Figure 33: BMRI’s 5-Year P/BV band

Source: RHB, Company Source: RHB, Bloomberg (as of 10 Sep 2019)

Ticker Rating Price TP Upside/Downside

Market Cap

(IDR) (IDR) (%) (USDm) FY19F FY20F FY19F FY20F FY19F FY20F FY19F FY20F FY19F FY20FBank Mandiri BMRI IJ Buy 7,050 10,000 41.8 23,413 11.5 10.2 1.7 1.5 N/A N/A 15.1 15.5 48.8 50.0Surya Citra Media SCMA IJ Buy 1,255 2,415 92.4 1,319 11.7 10.4 3.4 3.1 8.2 7.3 31.7 31.1 28.3 29.1Mitra Adiperkasa MAPI IJ Buy 1,025 1,300 26.8 1,211 19.0 15.7 3.1 2.6 7.9 6.9 15.4 18.0 4.3 4.5Merdeka Copper Gold MDKA IJ Buy 6,025 7,220 19.8 1,878 22.3 19.2 4.3 3.5 9.8 0.0 18.3 17.8 20.4 22.3

Net margin (%)Company P/E (x) P/BV (x) EV/EBITDA (x) ROAE (%)

Corporate43%

Commercial22%

Micro14%

Consumer13%

SME8%

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P/BV = 1.7x


18 September 2019



Figure 34: Corporate governance checklist

No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or the directors been involved in a legal case in the past 7 years No √

2 Has the company or any of the directors been subjected to sanction, investigation by the Indonesia Stock Exchange in the past 7 years No √




Source: RHB

Surya Citra Media (SCMA IJ, BUY, TP: IDR2,415)

Surya Citra Media is a media company with a unique integrated media ecosystem, offering end-to-end advertising solutions from traditional free-to-air TV (SCTV, Indosiar), content production (Sinemart), out-of-home (OOH) billboards (EYE), online media (KLY), video-streaming platforms (Vidio.com), and event management and social media campaigns (Samara Media). The company is ultimately owned by the Sariatmadja family’s Emtek Group (EMTK IJ, NR). Sector-high ROE of 35% posted in FY18 with a strong net cash balance and robust free cash flow generation. Its ROE is superior than its media peers, at 15-25%. We forecast SCMA’s ROE should hover around 31-32% in FY19-21F, albeit slightly lower due to the higher projected opex from its newly-injected (May 2019) digital media assets (KLY, Vidio, EYE, Samara) which are still in the growth stages and are not yet profitable. However, its 2Q19 numbers showed that topline grew strong by 15% YoY. Looking at the segmental breakdown in 1H19, digital and OOH advertising pre-elimination revenue grew by 69% YoY, while TV’s pre-elimination revenue grew by 5% YoY, and content and other revenue grew by 11% YoY. It is clear that the biggest growth driver is now from digital and OOH business. Sector-high operating margin from in-house production. SCMA generates a sector high operating margin of 37% on the back of strong in-house and local content production (via PT IEG) to keep costs efficient and boost operating leverage. Its flagship TV station, SCTV, focuses on local soap opera dramas (Sinetron), while its second TV station, Indosiar, focuses more on variety shows and talent search programmes – especially those featuring dangdut music. Sinetrons and variety shows generally have high margins, vs imported content like Hollywood movies or foreign football league matches. Trading attractively at 10x P/E with 31% ROE. We value SCMA using a target of 20x towards 2020F EPS of IDR121/share. We believe that the premium (vs the market average of 15x) is justified on the back of SCMA’s sector-high ROE of >30%, backed with a net cash balance sheet and strong free cash flow generation. The target 20x is -1SD below its 5-year mean. Corporate governance. SCMA is ultimately owned by Emtek Group, which holds a 61% stake. The company has been a media company since 1999, and has a good track record. We are not aware of any corporate governance issues; there were three instances of earnings surprise, during the past five years, on the negative side though.

♦ Henry Wibowo +62 21 2970 7056 [email protected]

♦ Ghibran Al Imran +62 21 2970 7061 [email protected]

Figure 35: Prime-time (6pm-11pm) audience shares Figure 36: SCMA’s 5-year P/E band

Source: Nielsen, Company, RHB Source: RHB, Bloomberg (as of 10 Sep 2019)

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P/E = 11.4x


18 September 2019



Figure 37: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or the directors been involved in a legal case in the past 7 years No √





Source: RHB

Mitra Adi Perkasa (MAPI IJ, BUY, TP: IDR1,300)

Mitra Adi Perkasa (MAPI) is the leading mid- to high-end lifestyle retailer with a multinational presence. The company operates more than 2,300 retail stores with a diversified portfolio that incudes sports, fashion, department stores, kids, food & beverage (F&B) and lifestyle products. Some of the iconic brands include Starbucks, Zara, Marks & Spencer, SOGO, SEBU, Reebok and many others. MAPI is set to benefit from the increasing demand for lifestyle products, given the vast growing middle-class population. One of the fastest-growing retailers in Indonesia. With its vision to be the leading omni-channel retailer in Indonesia, MAPI recorded a 34% jump in operating profit. Its diversified multi-brand business model fuels its topline, and it is growing faster than any other listed fashion retailer in Indonesia. Given the weak CPO prices YTD, MAPI seems insulated from the slowdown in the mass market economy. The company opened 216 stores in 1H19, adding c.45k sqm of selling space – with growth focused on the active (MAP Active (MAPA)) and F&B divisions. Market leader in active apparel. Having a dominant market share of 64% in activewear retailing, MAPA, a subsidiary of MAPI, operates c.1,000 outlets selling >150 brands. The company recorded the fastest SSSG in 2Q19 among the Indonesian retailers under our coverage. The underpenetrated activewear segment should provide much growth potential for the company, thereby justifying its aggressive store expansion (selling space: +17% YoY). In 1H19, MAPA recorded 19.4% YoY revenue growth, with operating profit up 29.4% YoY. Improvement in merchandising planning and logistics should further improve margins ahead. Potential department store spin-off. MAPI’s department store business as dragged its consolidated operations’ growth since 2016. The potential spinning-off of this segment should be a positive for it. On the back of e-commerce disruption, specialty stores offer more strategic selling points. Previously, MAPI also closed down its Lotus and Debenhams outlets due to their poor performance. In 1H19, department stores accounted for 14% of MAPI’s pre-tax profit. The segment posted an operating profit margin of 8.5%, lower than the consolidated level’s 9.4%. As such, we should see an increase in operating profit margins post the spin-off. Attractive valued at -1SD from its 3-year mean. With a superior ROE of 15.4%, MAPI is trading at a bargain-level 19x 2019F P/E, with the majority of revenue contributions coming from specialty stores. In our SOP valuation, MAPI is trading at par with the subsidiary’s current trading value – but with much better liquidity. Corporate governance. The management has appointed three independent committee audit members in 2012 with Deloitte as auditor since 2005. We are not aware of any corporate governance issues; over the past five years there were four instances of earnings surprise on the negative side though.

♦ Michael Setjoadi +62 21 2970 7059 [email protected]

♦ Jessica Ayu Pratiwi +62 21 2970 7061 [email protected]

Figure 38: Revenue breakdown Figure 39: Revenue growth vs operating margin

Source: RHB, Company data Source: RHB, Company data

72.7%

14.1%

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Café and restaurant Others

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18 September 2019



Figure 40: Corporate governance checklist No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or the directors been involved in a legal case in the past 7 years No √





Source: RHB

Merdeka Copper Gold (MDKA IJ, BUY, TP: IDR7,220) Merdeka Copper Gold is a holding company with a primary business in the mining of gold, copper, and silver. It has four main projects – two are currently in the production stages (the Tujuh Bukit Oxide and Wetar projects), while the remaining two are under their development stages, ie the Tujuh Bukit Porphyry and Pani mines. Bukit Porphyry is MDKA’s most valuable mine, as it has Indonesia’s second-largest copper and gold deposits – comparable to Freeport’s Grasberg mine. The company reported a 14.8% ROE in FY18, and we expect MDKA to post a 18% ROE in FY19 due to increased revenue contributions from its copper project in Wetar. Our FY19 ROE is significantly higher than its regional peers’ 10.5%. MDKA typically records c.43% GPM and c.20% NPM. We expect 42 – 45% for the company’s GPM in 2019F-2021F and estimate 20-22% NPM during this same period. MDKA’s margins will widen along with the increase in its ASPs, which we benchmark using the international price of gold. We derive our 12-month TP of IDR7,220 based on a target 2020F P/E of 23x. We believe the multiple, which is on par with global gold miners’ valuations, is justified – this is given the company’s higher ROE profile of 18% vs the global peer average of 10%. Two of MDKA’s key shareholders – Saratoga Capital (20.8%) and Garibaldi Thohir (9.4%) – are the same key stakeholders of Indonesia’s leading coal producer, Adaro Energy (ADRO IJ, NEUTRAL, TP: IDR1,360). The latter has one of the best execution and corporate governance track records in the country. Garibaldi is also the brother of Erick Thohir, the campaign manager of President Joko Widodo during the 2019 election. MDKA’s largest shareholder is Winato Kartono’s Provident Capital, which controls a combined 21.2% stake via Mitra Daya Mustika (14.2%) and Suwarna Arta Mandiri (7%). Management-wise, the company is led by CEO Richard Bruce Ness (a former executive with Freeport Indonesia, Newmont Indonesia, and Indika Energy), COO Mark Andersen (who has 30-plus years of experience with Rio Tinto), and technical director Colin Francis Moorhead (a geologist with 35-plus years of experience).

♦ Andrew Hotama +62 21 2970 7065 [email protected]

♦ Ja’far Saifuddin +62 21 2783 0719 [email protected]

Figure 41: MDKA’s yearly GPM (2017-2021F) Figure 42: MDKA’s revenue contribution

Source: RHB, Company Source: RHB, Company

Figure 43: Corporate governance checklist

No Questions (on both corporations and directors) Respond Flag (X) 1 Has the company or the directors been involved in a legal case in the past 7 years No √ 2 Has the company or any of the directors been subjected to sanction, investigation by the

Indonesia Stock Exchange in the past 7 years No √ 3 How frequent was the change in auditor in the past 7 years Nil √ 4 Ease of management access/openness in engaging with the public and investors such

as small group meetings, briefings, NDRs and etc. Yes √


Source: RHB


18 September 2019

17


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 Investment Research Disclaimers RHB has issued this report for information purposes only. This report is intended for circulation amongst RHB and its affiliates’ clients generally or such persons as may be deemed eligible by RHB to receive this report and does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. This report is not intended, and should not under any circumstances be construed as, an offer or a solicitation of an offer to buy or sell the securities referred to herein or any related financial instruments. This report may further consist of, whether in whole or in part, summaries, research, compilations, extracts or analysis that has been prepared by RHB’s strategic, joint venture and/or business partners. No representation or warranty (express or implied) is given as to the accuracy or completeness of such information and accordingly investors should make their own informed decisions before relying on the same. This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to the applicable laws or regulations. By accepting this report, the recipient hereof (i) represents and warrants that it is lawfully able to receive this document under the laws and regulations of the jurisdiction in which it is located or other applicable laws and (ii) acknowledges and agrees to be bound by the limitations contained herein. Any failure to comply with these limitations may constitute a violation of applicable laws. All the information contained herein is based upon publicly available information and has been obtained from sources that RHB believes to be reliable and correct at the time of issue of this report. However, such sources have not been independently verified by RHB and/or its affiliates and this report does not purport to contain all information that a prospective investor may require. The opinions expressed herein are RHB’s present opinions only and are subject to change without prior notice. 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Any recommendations contained in this report must therefore not be relied upon as investment advice based on the recipient's personal circumstances. Investors should make their own independent evaluation of the information contained herein, consider their own investment objective, financial situation and particular needs and seek their own financial, business, legal, tax and other advice regarding the appropriateness of investing in any securities or the investment strategies discussed or recommended in this report. This report may contain forward-looking statements which are often but not always identified by the use of words such as “believe”, “estimate”, “intend” and “expect” and statements that an event or result “may”, “will” or “might” occur or be achieved and other similar expressions. Such forward-looking statements are based on assumptions made and information currently available to RHB and are subject to known and unknown risks, uncertainties and other factors which may cause the actual results,

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Such addresses or hyperlinks (including addresses or hyperlinks to RHB own website material) are provided solely for the recipient’s convenience. The information and the content of the linked site do not in any way form part of this report. Accessing such website or following such link through the report or RHB website shall be at the recipient’s own risk. This report may contain information obtained from third parties. Third party content providers do not guarantee the accuracy, completeness, timeliness or availability of any information and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such content. Third party content providers give no express or implied warranties, including, but not limited to, any warranties of merchantability or fitness for a particular purpose or use. 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The contents of this report is strictly confidential and may not be copied, reproduced, published, distributed, transmitted or passed, in whole or in part, to any other person without the prior express written consent of RHB and/or its affiliates. This report has been delivered to RHB and its affiliates’ clients for information purposes only and upon the express understanding that such parties will use it only for the purposes set forth above. By electing to view or accepting a copy of this report, the recipients have agreed that they will not print, copy, videotape, record, hyperlink, download, or otherwise attempt to reproduce or re-transmit (in any form including hard copy or electronic distribution format) the contents of this report. RHB and/or its affiliates accepts no liability whatsoever for the actions of third parties in this respect. The contents of this report are subject to copyright. Please refer to Restrictions on Distribution below for information regarding the distributors of this report. Recipients must not reproduce or disseminate any content or findings of this report without the express permission of RHB and the distributors. The securities mentioned in this publication may not be eligible for sale in some states or countries or certain categories of investors. The recipient of this report should have regard to the laws of the recipient’s place of domicile when contemplating transactions in the securities or other financial instruments referred to herein. The securities discussed in this report may not have been registered in such jurisdiction. Without prejudice to the foregoing, the recipient is to note that additional disclaimers, warnings or qualifications may apply based on geographical location of the person or entity receiving this report. The term “RHB” shall denote, where appropriate, the relevant entity distributing or disseminating the report in the particular jurisdiction referenced below, or, in every other case, RHB Investment Bank Berhad and its affiliates, subsidiaries and related companies. RESTRICTIONS ON DISTRIBUTION Malaysia This report is issued and distributed in Malaysia by RHB Investment Bank Berhad (“RHBIB”). The views and opinions in this report are our own as of the date hereof and is subject to change. If the Financial Services and Markets Act of the United Kingdom or the rules of the Financial Conduct Authority apply to a recipient, our obligations owed to such recipient therein are unaffected. RHBIB has no obligation to update its opinion or the information in this report. Thailand This report is issued and distributed in the Kingdom of Thailand by RHB Securities (Thailand) PCL, a licensed securities company that is authorised by the Ministry of Finance, regulated by the Securities and Exchange Commission of Thailand and is a member of the Stock Exchange of Thailand. The Thai Institute of Directors Association has disclosed the Corporate Governance Report of Thai Listed Companies made pursuant to the policy of the Securities and Exchange Commission of Thailand. RHB Securities (Thailand) PCL does not endorse, confirm nor certify the result of the Corporate Governance Report of Thai Listed Companies.

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Indonesia This report is issued and distributed in Indonesia by PT RHB Sekuritas Indonesia. This research does not constitute an offering document and it should not be construed as an offer of securities in Indonesia. Any securities offered or sold, directly or indirectly, in Indonesia or to any Indonesian citizen or corporation (wherever located) or to any Indonesian resident in a manner which constitutes a public offering under Indonesian laws and regulations must comply with the prevailing Indonesian laws and regulations. Singapore This report is issued and distributed in Singapore by RHB Securities Singapore Pte Ltd which is a holder of a capital markets services licence and an exempt financial adviser regulated by the Monetary Authority of Singapore. RHB Securities Singapore Pte Ltd may distribute reports produced by its respective foreign entities, affiliates or other foreign research houses pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, RHB Securities Singapore Pte Ltd accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact RHB Securities Singapore Pte Ltd in respect of any matter arising from or in connection with the report. Hong Kong This report is issued and distributed in Hong Kong by RHB Securities Hong Kong Limited (興業僑豐證券有限公司) (CE No.: ADU220) (“RHBSHK”) which is licensed in Hong Kong by the Securities and Futures Commission for Type 1 (dealing in securities) and Type 4 (advising on securities) regulated activities. Any investors wishing to purchase or otherwise deal in the securities covered in this report should contact RHBSHK. RHBSHK is a wholly owned subsidiary of RHB Hong Kong Limited; for the purposes of disclosure under the Hong Kong jurisdiction herein, please note that RHB Hong Kong Limited with its affiliates (including but not limited to RHBSHK) will collectively be referred to as “RHBHK.” RHBHK conducts a full-service, integrated investment banking, asset management, and brokerage business. RHBHK does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this research report. Investors should consider this report as only a single factor in making their investment decision. Importantly, please see the company-specific regulatory disclosures below for compliance with specific rules and regulations under the Hong Kong jurisdiction. Other than company-specific disclosures relating to RHBHK, this research report is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. United States This report was prepared by RHB and is being distributed solely and directly to “major” U.S. institutional investors as defined under, and pursuant to, the requirements of Rule 15a-6 under the U.S. Securities and Exchange Act of 1934, as amended (the “Exchange Act”). Accordingly, access to this report via Bursa Marketplace or any other Electronic Services Provider is not intended for any party other than “major” US institutional investors, nor shall be deemed as solicitation by RHB in any manner. RHB is not registered as a broker-dealer in the United States and does not offer brokerage services to U.S. persons. Any order for the purchase or sale of the securities discussed herein that are listed on Bursa Malaysia Securities Berhad must be placed with and through Auerbach Grayson (“AG”). Any order for the purchase or sale of all other securities discussed herein must be placed with and through such other registered U.S. broker-dealer as appointed by RHB from time to time as required by the Exchange Act Rule 15a-6. This report is confidential and not intended for distribution to, or use by, persons other than the recipient and its employees, agents and advisors, as applicable. Additionally, where research is distributed via Electronic Service Provider, the analysts whose names appear in this report are not registered or qualified as research analysts in the United States and are not associated persons of Auerbach Grayson AG or such other registered U.S. broker-dealer as appointed by RHB from time to time and therefore may not be subject to any applicable restrictions under Financial Industry Regulatory Authority (“FINRA”) rules on communications with a subject company, public appearances and personal trading. Investing in any non-U.S. securities or related financial instruments discussed in this research report may present certain risks. The securities of non-U.S. issuers may not be registered with, or be subject to the regulations of, the U.S. Securities and Exchange Commission. Information on non-U.S. securities or related financial instruments may be limited. Foreign companies may not be subject to audit and reporting standards and regulatory requirements comparable to those in the United States. The financial instruments discussed in this report may not be suitable for all investors. Transactions in foreign markets may be subject to regulations that differ from or offer less protection than those in the United States. DISCLOSURE OF CONFLICTS OF INTEREST RHB Investment Bank Berhad, its subsidiaries (including its regional offices) and associated companies, (“RHBIB Group”) form a diversified financial group, undertaking various investment banking activities which include, amongst others, underwriting, securities trading, market making and corporate finance advisory. As a result of the same, in the ordinary course of its business, any member of the RHBIB Group, may, from time to time, have business relationships with or hold positions in the securities (including capital market products) or perform and/or solicit

investment, advisory or other services from any of the subject company(ies) covered in this research report. While the RHBIB Group will ensure that there are sufficient information barriers and internal controls in place where necessary, to prevent/manage any conflicts of interest to ensure the independence of this report, investors should also be aware that such conflict of interest may exist in view of the investment banking activities undertaken by the RHBIB Group as mentioned above and should exercise their own judgement before making any investment decisions. Malaysia Save as disclosed in the following link RHB Research conflict disclosures – Sep 2019 and to the best of our knowledge, RHBIB hereby declares that: 1. RHBIB does not have a financial interest in the securities or other capital market

products of the subject company(ies) covered in this report. 2. RHBIB is not a market maker in the securities or capital market products of the

subject company(ies) covered in this report. 3. None of RHBIB’s staff or associated person serve as a director or board

member* of the subject company(ies) covered in this report *For the avoidance of doubt, the confirmation is only limited to the staff of research department

4. Save as disclosed below, RHBIB did not receive compensation for investment banking or corporate finance services from the subject company in the past 12 months.

5. RHBIB did not receive compensation or benefit (including gift and special cost arrangement e.g. company/issuer-sponsored and paid trip) in relation to the production of this report.

Thailand RHB Securities (Thailand) PCL and/or its directors, officers, associates, connected parties and/or employees, may have, or have had, interests and/or commitments in the securities in subject company(ies) mentioned in this report or any securities related thereto. Further, RHB Securities (Thailand) PCL may have, or have had, business relationships with the subject company(ies) mentioned in this report. As a result, investors should exercise their own judgment carefully before making any investment decisions. Indonesia PT RHB Sekuritas Indonesia is not affiliated with the subject company(ies) covered in this report both directly or indirectly as per the definitions of affiliation above. Pursuant to the Capital Market Law (Law Number 8 Year 1995) and the supporting regulations thereof, what constitutes as affiliated parties are as follows: 1. Familial relationship due to marriage or blood up to the second degree, both

horizontally or vertically; 2. Affiliation between parties to the employees, Directors or Commissioners of the

parties concerned; 3. Affiliation between 2 companies whereby one or more member of the Board of

Directors or the Commissioners are the same; 4. Affiliation between the Company and the parties, both directly or indirectly,

controlling or being controlled by the Company; 5. Affiliation between 2 companies which are controlled, directly or indirectly, by the

same party; or 6. Affiliation between the Company and the main Shareholders. PT RHB Sekuritas Indonesia is not an insider as defined in the Capital Market Law and the information contained in this report is not considered as insider information prohibited by law. Insider means: a. a commissioner, director or employee of an Issuer or Public Company; b. a substantial shareholder of an Issuer or Public Company; c. an individual, who because of his position or profession, or because of a

business relationship with an Issuer or Public Company, has access to inside information; and

d. an individual who within the last six months was a Person defined in letters a, b or c, above.

Singapore Save as disclosed in the following link (RHB Research conflict disclosures – Sep 2019) and to the best of our knowledge, RHB Securities Singapore Pte Ltd hereby declares that: 1. RHB Securities Singapore Pte Ltd, its subsidiaries and/or associated companies

do not make a market in any issuer covered in this report. 2. RHB Securities Singapore Pte Ltd, its subsidiaries and/or its associated

companies and its analysts do not have a financial interest (including a shareholding of 1% or more) in the issuer covered in this report.

3. RHB Securities, its staff or connected persons do not serve on the board or trustee positions of the issuer covered in this report.

4. RHB Securities Singapore Pte Ltd, its subsidiaries and/or its associated companies do not have and have not within the last 12 months had any corporate finance advisory relationship with the issuer covered in this report or any other relationship that may create a potential conflict of interest.

5. RHB Securities Singapore Pte Ltd, or person associated or connected to it do not have any interest in the acquisition or disposal of, the securities, specified securities based derivatives contracts or units in a collective investment scheme covered in this report.

6. RHB Securities Singapore Pte Ltd and its analysts do not receive any compensation or benefit in connection with the production of this research report or recommendation.

https://research.rhbtradesmart.com/attachments/68/rhb-report-rhbib-and-rhbs-conflict-of-interest-disclosures-sep-2019-760077210435231205d72153c2000e.pdf

https://research.rhbtradesmart.com/attachments/68/rhb-report-rhbib-and-rhbs-conflict-of-interest-disclosures-sep-2019-760077210435231205d72153c2000e.pdf

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Hong Kong The following disclosures relate to relationships between RHBHK and companies covered by Research Department of RHBSHK and referred to in this research report: RHBSHK hereby certifies that no part of RHBSHK analyst compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this research report. RHBHK had an investment banking services client relationships during the past 12 months with: -. RHBHK has received compensation for investment banking services, during the past 12 months from: -. RHBHK managed/co-managed public offerings, in the past 12 months for: -. On a principal basis. RHBHK has a position of over 1% market capitalization of: -. Additionally, please note the following: Ownership and material conflicts of interest: RHBSHK policy prohibits its analysts and associates reporting to analysts from owning securities of any company covered by the analyst. Analyst as officer or director: RHBSHK policy prohibits its analysts, and associates reporting to analysts from serving as an officer, director, advisory board member or employee of any company covered by the analyst. RHBHK salespeople, traders, and other non-research professionals may provide oral or written market commentary or trading strategies to RHB clients that reflect opinions that are contrary to the opinions expressed in this research report.

KUALA LUMPUR

RHB Investment Bank Bhd Level 3A, Tower One, RHB Centre Jalan Tun Razak Kuala Lumpur 50400 Malaysia Tel : +603 9280 8888 Fax : +603 9200 2216

JAKARTA

PT RHB Sekuritas Indonesia Wisma Mulia, 20th Floor Jl. Jenderal Gatot Subroto No. 42 Jakarta 12710 Indonesia Tel : +6221 2783 0888 Fax :+6221 2783 0777

HONG KONG

RHB Securities Hong Kong Ltd. 12th Floor, World-Wide House 19 Des Voeux Road Central Hong Kong Tel : +852 2525 1118 Fax : +852 2810 0908

BANGKOK

RHB Securities (Thailand) PCL 10th Floor, Sathorn Square Office Tower 98, North Sathorn Road, Silom Bangrak, Bangkok 10500 Thailand Tel: +66 2088 9999 Fax :+66 2088 9799

SINGAPORE

RHB Securities Singapore Pte Ltd. 10 Collyer Quay #09-08 Ocean Financial Centre Singapore 049315 Tel : +65 6533 1818 Fax : +65 6532 6211

การจดัอันดบับรรษัทภิบาล 2561 (Thai Institute of Directors Association (IOD) – Corporate Governance Report Rating 2018

Website: www.thai-iod.com

IOD (IOD Disclaimer)

ผลสาํรวจการกํากบัดแูลกิจการบริษัทจดทะเบียนที่แสดงไว้นี ้ เป็นผลที่ได้จากการสํารวจและประเมินข้อมลูทีบ่ริษัทจดทะเบยีนในตลาดหลกัทรัพย์แหง่ประเทศไทย และ

ตลาดหลกัทรัพย์ เอ็ม เอ ไอ (“บริษัทจดทะเบียน”) เปิดเผยตอ่สาธารณะและเป็นข้อมลูที่ผู้ลงทนุทัว่ไปสามารถเข้าถึงได้ ผลสํารวจดงักลา่วจงึเป็นการนําเสอนข้อมลูในมมุมอง

ของบคุคลภายนอกตอ่มาตรฐานการกํากบัดแูลกิจการของบริษัทจดทะเบยีน โดยไมไ่ด้เป็นการประเมินผลการปฏิบตัิงานหรือการดาํเนินกิจการของบริษัทจดทะเบียนอีกทัง้มิได้

ใช้ข้อมลูภายในของบริษัทจดทะเบยีนในการประเมิน ดงันัน้ผลสํารวจทีแ่สดงนีจ้งึไมไ่ด้เป็นการรับรองถึงผลการปฏิบตัิงานหรือการดาํเนินการของบริษัทจดทะเบียนและไมถื่อ

เป็นการให้คําแนะนําในการลงทนุในหลกัทรัพย์ของบริษัทจดทะเบียนหรือคาํแนะนําใดๆ ผู้ใช้ข้อมลูจงึควรใช้วจิารณญาณของตนเองในการวิเคราะห์และตดัสินใจในการใช้

ข้อมลูใดๆที่เก่ียวกบับริษัทจดทะเบียนที่แสดงในผลสาํรวจนี ้

ทัง้นีบ้ริษัทหลักทรัพย์ อาร์เอชบี (ประเทศไทย) จาํกัด (มหาชน) มิได้ยืนยันหรือรับรองถงึความครบถ้วนและถูกต้องของผลสาํรวจดังกล่าวแต่อย่างใด

ADVANC AKP AMATA AMATAV ANAN AOT AP BAFS BANPU BAYBCP BCPG BRR BTS BWG CFRESH CHO CK CKP CMCNT COL CPF CPI CPN CSL CSS DELTA DEMCO DRTDTAC DTC EA EASTW EGCO GC GEL GFPT GGC GOLDGPSC GRAMMY GUNKUL HANA HMPRO ICC ICHI INTUCH IRPC IVLJSP KBANK KCE KKP KSL KTB KTC LHFG LIT LPNMAKRO MBK MCOT MINT MONO MTC NCL NKI NVD NYTOISHI OTO PCSGH PDJ PG PHOL PLANB PLANET PPS PRGPSH PSL PTG PTT PTTEP PTTGC PYLON Q-CON QH QTCRATCH ROBINS S & J SABINA SAMART SAMTEL SAT SC SCB SCCSCCC SDC SE-ED SIS SITHAI SNC SPALI SPRC SSSC STECSVI SYNTEC TASCO TCAP THAI THANA THANI THCOM THIP THRELTIP TISCO TKT TMB TNDT TOP TRC TRU TRUE TSCTSTH TTCL TU TVD UAC UV VGI VIH WACOAL WAVEWHA WINNER

2S AAV ACAP AGE AH AHC AIRA AIT AKR ALLAALT AMA AMANAH APCO AQUA ARIP ARROW ASIA ASIMAR ASK

ASN ASP ATP30 AU AUCT AYUD BA BBL BDMS BECBEM BFIT BGRIM BIZ BJC BJCHI BLA BOL BPP BROOKBTW CBG CEN CENTEL CGH CHEWA CHG CHOW CI CIMBTCNS COM7 COMAN CPALL CSC CSP DCC DCORP DDD EASONECF ECL EE EPG ERW ETE FN FNS FORTH FPIFSMART FVC GBX GCAP GLOBAL GLOW GULF HARN HPT HTCHYDRO ICN ILINK INET IRC ITD JAS JCKH JKN JWDK KBS KCAR KGI KKC KOOL KTIS L&E LANNA LDCLH LHK LOXLEY LRH LST M MACO MAJOR MALEE MBKETMC MEGA METCO MFC MFEC MK MOONG MSC MTI NCHNEP NINE NOBLE NOK NSI NTV NWR OCC OGC ORIPAP PATO PB PDI PJW PLAT PM PORT PPP PREBPRECHA PRINC PRM PT QLT RICHY RML RS RWI SS11 SALEE SANKO SAWAD SCGS SCI SCN SE SEAFCO SEAOILSELIC SENA SFP SIAM SINGER SIRI SKE SMK SMPC SMTSNP SORKON SPC SPI SPPT SPVI SR SSF SST STASUC SUSCO SUTHA SWC SYMC SYNEX TACC TAE TAKUNI TBSPTCC TEAM TFG TFMAMA THRE TICON TIPCO TK TKN TKSTM TMC TMI TMILL TMT TNITY TNL TNP TNR TOATOG TPA TPAC TPBI TPCORP TRITN TRT TSE TSR TSTETTA TTW TVI TVO TWP TWPC U UMI UOBKH UPUPF UPOIC UT UWC VNT WHAUP WICE WIIK XO YUASAZMICO

7UP ABICO ABM AEC AEONTS AF AJ ALUCON AMARIN AMCAS ASAP ASEFA ASIAN BCH BEAUTY BGT BH BIG BLANDBM BR BROCK BSBM BTNC CCET CCP CGD CHARAN CHAYOCITY CMO CMR COLOR CPL CPT CRD CSR CTW CWTD DCON DIGI DIMET EKH EMC EPCO ESSO ESTAR EEFLOYD FOCUS FSS FTE GENCO GIFT GJS GLAND GPI GREENGTB GYT HTECH IFS IHL III INOX INSURE IRCP ITITEL J JCK JMART JMT JTS JUBILE KASET KCM KIATKWC KWG KYE LALIN LEE LPH MATCH MATI MBAX M-CHAIMDX META MILL MJD MM MODERN MPG NC NDR NETBAYNNCL NPK OCEAN PAF PDG PF PICO PIMO PK PLPLE PMTA PPPM PRIN PSTC PTL RCI RCL RJH ROJNARPC RPH SAMCO SAPPE SCP SF SGF SGP SKN SKRSKY SLP SMIT SOLAR SPA SPCG SPG SQ SRICHA SSCSSP STANLY STPI SUN SUPER SVOA T TCCC TCMC THETHG THMUI TIC TITLE TIW TMD TOPP TPCH TPIPP TPOLYTTI TVT TYCN UEC UMS UNIQ VCOM VBIHA VPO WINWORK WP WPH ZIGA

http://www.thai-iod.com/

ขอ้มลู Anti-Corruption Progress Indicator 2560 ประกาศเจตนารมณ์ CAC

ได้รับการรับรอง CAC

N/A

Source: Thai Institute of Directors

ขอ้มลูบรษิทัทีเ่ขา้ร่วมโครงการแนวร่วมปฏบิตัขิองภาคเอกชนไทยในการต่อตา้นทุจรติ (Thai CAC) ของสมาคมส่งเสรมิสถาบนักรรมการบรษิทัไทย (ขอ้มลู ณ วนัที ่17 ต.ค.)

• ไดป้ระกาศเจตนารมณ์เขา้ร่วม CAC

• ไดร้บัการรบัรอง CAC

การเปิดเผยการประเมนิดชันีชีว้ดัความคบืหน้าการป้องกนัการมสี่วนเกีย่วขอ้งกบัการทุจรติคอรร์ปัชนั (Anti-Corruption Progress Indicators) ของบรษิทัจดทะเบยีนในตลาดหลกัทรพัย์แห่งประเทศไทยที่

จดัทาํโดยสถาบนัทีเ่กีย่วขอ้งซึง่มกีารเปิดเผยโดยสาํนกังานคณะกรรมการกาํกบัหลกัทรพัยแ์ละตลาดหลกัทรพัยน้ี์เป็นการดาํเนินการตามนโยบายและตามแผนพฒันาความยัง่ยนืสําหรบับรษิทัจดทะเบยีนโดย

ผลการประเมนิดงักล่าว สถาบนัทีเ่กีย่วขอ้งอาศยัขอ้มลูทีไ่ดร้บัจากบรษิทัจดทะเบยีนตามทีบ่รษิทัจดทะเบยีนไดร้ะบุในแบบแสดงขอ้มลูเพื่อการประเมนิ Anti-Corruption ซึง่อา้งองิขอ้มลูมาจากแบบแสดง

รายงานขอ้มลูประจาํปี แบบ (56-1) รายงานประจาํปีแบบ (56-2) หรอืในเอกสารหรอืรายงานอื่นทีเ่กีย่วขอ้งซึง่เป็นบุคคลภายนอก โดยมไิดเ้ป็นการประเมนิการปฏบิตัขิองบรษิทัจดทะเบยีนในตลาดหลกัทรพัย์

แห่งประเทศไทยและมไิดใ้ชข้อ้มูลภายในเพื่อการประเมนิ เนื่องจากผลการประเมนิดงักล่าวเป็นเพยีงผลการประเมนิ ณ วนัที่ ปรากฏในผลการประเมนิเท่านัน้ ดงันัน้ผลการประเมนิจงึอาจเปลีย่นแปลงได้

ภายหลงัวนัดงักล่าว หรอืรบัรองความถกูตอ้งครบถว้นของผลประเมนิดงักล่าวแต่อย่างใด

Documents

Regional Thematic Report - RHB TradeSmart