ed: TH / sa: CS

BUY (Initiating Coverage) Last Traded Price: Bt17.10 (SET : 1,268.07) Price Target: Bt20.20 (18% upside) Potential Catalyst: Winning of submarine wiring project to Samui Island Analyst Wasu MATTANAPOTCHANART +66 2657 7826 wasum@th.dbsvickers.com

Price Relative

Forecasts and Valuation FY Dec (Btm) 2014A 2015F 2016F 2017FRevenue 2,683 3,067 3,862 4,469EBITDA 281 385 496 547Pre-tax Profit 271 357 483 538Net Profit 219 285 386 429Net Pft (Pre Ex.) 219 285 386 429EPS (Bt) 0.67 0.85 1.10 1.18EPS Pre Ex. (Bt) 0.67 0.85 1.10 1.18EPS Gth (%) 22 26 30 7EPS Gth Pre Ex (%) 22 26 30 7Diluted EPS (Bt) 0.67 0.85 1.06 1.18Net DPS (Bt) 0.02 0.34 0.44 0.47BV Per Share (Bt) 4.59 5.63 7.13 8.07PE (X) 25.4 20.1 15.5 14.4PE Pre Ex. (X) 25.4 20.1 15.5 14.4P/Cash Flow (X) 27.4 9.3 8.4 8.5EV/EBITDA (X) 20.4 15.0 11.5 10.9Net Div Yield (%) 0.1 2.0 2.6 2.8P/Book Value (X) 3.7 3.0 2.4 2.1Net Debt/Equity (X) 0.1 0.0 CASH CASHROAE (%) 15.8 16.9 17.6 15.8 Consensus EPS (Bt): 0.84 0.99 1.08Other Broker Recs: B: 1 S: 0 H: 0 ICB Industry : Technology ICB Sector: Technology Hardware & Equipment Principal Business: Interlink Communication imports and distributes cabling accessories such as fiber optic cable, LAN cable, connector, media convertor and rack cabinet from AMP and LINK. The firm also acts as a contractor for cabling, networking and communication systems.

Source of all data: Company, DBS Vickers, Bloomberg Finance L.P

At A Glance

Issued Capital (m shrs) 336Mkt. Cap (Btm/US$m) 5,739 / 160Major Shareholders Anuntarumporn (%) 28.41 Interlink Holding Co.,Ltd (%) 26.32 Sakchaichroekul’s family (%) 15.57Free Float (%) 33.933m Avg. Daily Val (US$m) 0.14

DBS Group Research . Equity 27 Jan 2016

Thailand Company Focus

Interlink Communication Bloomberg: ILINK TB | Reuters: ILINK.BK Refer to important disclosures at the end of this report

King of cabling ILINK, a small-cap growth player

Growth from engineering and telecom businesses

Major risk: reliance on two brands of cables

Initiate with BUY and TP of Bt20.20, based on 19.0x PE

ILINK, a small-cap growth player. ILINK is a leading trader of indoor data cables (65% of FY15F revenue) in Thailand. It also has two other businesses, namely i) engineering (22% of revenue), in which it acts as Engineering Procurement Construction (EPC) contractor for submarine projects, and ii) telecom (13% of revenue), in which the company provides the services of fibre rental, data centres and project works. Its growth is expected to come from engineering and telecom businesses during the next two years. Growth from engineering and telecom businesses. The Samui submarine cabling project is expected to be up for bidding in Mar-Apr, and the winner should be announced by Jun-16. The project is worth Bt2.3bn, of which Bt800m should be realised as revenue in FY16F. We also expect growth from installation of fibre to home and data centre (telecom business). As a result, revenues are expected to grow by 26%/15% in FY16F/17F and earnings by 35%/11%. Major risk: reliance on two brands of cables. The trading business accounts for around 65% of revenue, and it relies mainly on two brands of cables, namely LINK and AMP. If either LINK or AMP adds distributors to its list, ILINK’s sales would likely be negatively impacted in the short to medium term. Initiate with BUY and TP of Bt20.20. The target price is based on 19x PE and fully-diluted FY16F EPS of Bt1.06. The target PE is 0.5SD over its 3-year mean forward PE, and takes into account ILINK’s strong earnings prospects and upside from potential projects. The biggest upside is from Bangkok Metropolitan Administration’s Chong Non See underground wiring project – phase 1 (Bt2.5bn) that should be up for bidding this year.

79

179

279

379

479

579

679

779

2.2

7.2

12.2

17.2

22.2

Jan-12 Jan-13 Jan-14 Jan-15 Jan-16

Relative IndexBt

Interlink Communication (LHS) Relative SET INDEX (RHS)

Page 2

Company Focus

Interlink Communication

INVESTMENT THESIS

Profile Rationale

Interlink Communication (ILINK) is a leading trader of indoor data cables (65% of FY15F revenue) in Thailand. It also has two other businesses, namely i) engineering (22% of revenue), in which it acts as a contractor for submarine and underground cable projects, and ii) telecom (23% of revenue). ILINK has 20,000 clients in the trading business, comprising contractors, wholesalers and designers. For the engineering business, its major clients have been TOT, Suvarnabhumi Airport, CAT Telecom, Metropolitan Electricity Authority and Provincial Electricity Authority. For the recurring telecom business, its clients are TRUE (backup capacity) and private enterprises (interconnected IT systems).

The most dominant cable seller in Thailand. ILINK is the sole distributor of LINK cables and one of the four sellers of AMP cables in Thailand; both LINK and AMP are from the US. The two brands have been in Thailand for around 30 years, so customers are familiar with the brands. They also have 25-30 years of warranty for clients. ILINK, small-cap growth player ILINK’s growth in FY16-17F is expected to come from engineering and telecom businesses during the next two years, thanks to the expected win of submarine project to Samui and fibre-to-the-home (FTTX) installation for TRUE.

Valuation Risks

The fair value of this stock is Bt20.20, based on 19x fully-diluted FY16F EPS of Bt1.06. The target PE is 0.5SD over its 3-year mean forward PE, and takes into account ILINK’s strong earnings prospects and upside from potential projects. The major upside is from Bangkok Metropolitan Administration’s Chong Non See underground wiring project (Bt2.5bn) that should be up for bidding this year.

Heavy reliance on two brands of cables Around 65% of revenue and 42% of net profit in FY15F are contributed by LINK and AMP cables. If either LINK or AMP adds distributors to its list, ILINK’s sales would likely be impacted. In the long run, ILINK should be able to find new brands of cables to make up for the market share loss. Warrants ILINK has a set of 11,129,688 warrants that will expire on 23 Jun 2016. They can be exercised on the last working day of each quarter. The exercise ratio is one warrant for 2.5 shares (exercise price = Bt8 per share), implying a 7.7% dilution.

Source: DBS Vickers

Page 3

Company Focus

Interlink Communication

SWOT Analysis

Strengths Weakness The largest cable seller in Thailand with 60% market share One of the few players with a track record in submarine

wiring projects The only operator with both highway and railway fibre-optic

network across the country

Heavy reliance on two brands of cables, LINK and AMP

Opportunities Threats Underground wiring projects in Bangkok National broadband project (Bt20bn) by the government Potential service (backup mobile broadband capacity) for Jas

Mobile Broadband

FTTX installation works could fade in the long run

Source: DBS Vickers

Page 4

Company Focus

Interlink Communication

Company Background Corporate History. Interlink Communication (ILINK) was founded by Sombat Anuntarumporn in 1995 as a seller of indoor cables. ILINK, now the leading trader of indoor data cables (LAN and fibre) in Thailand, has since expanded into two other businesses, namely engineering and telecom. The company was listed in the Stock Exchange of Thailand in 2004.

ILINK has 20,000 clients in the trading business, comprising contractors, wholesalers and designers. For the engineering business, its major clients have been TOT, Suvarnabhumi

Airport, CAT Telecom, Metropolitan Electricity Authority (MEA) and Provincial Electricity Authority (PEA). For the recurring telecom business, its clients are TRUE (backup capacity) and private enterprises (interconnected IT systems). ILINK acts as a mother company and sells cables; it owns Interlink Power and Energy (95.1% stake, engineering unit) Interlink Telecom (100% stake, telecom unit), and Interlink Data Center (100%, data centre unit).

Sales Trend Profitability Trend

Source: DBS Vickers ILINK group

Source: ILINK, DBS Vickers

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

2013A 2014A 2015F 2016F 2017F

Bt m

Total Revenue Revenue Growth (%) (YoY)

166

216

266

316

366

416

466

516

2013A 2014A 2015F 2016F 2017F

Bt m

Operating EBIT Pre tax Profit Net Profit

Interlink CommunicationDistributor of data cables

Interlink TelecomOperator of fibre-optic networks

Interlink Power and Energy

Contractor of submarine cables and transmission lines

Interlink Data CenterOperator of data centre (part of

the telecom business)

100% 100%

95.07%

Pa

age 5

Three ma i) Cable tra

With 60%of indoosince 20buildingstelecommtrading bmargins

ii) EngineerIn this linfor subm

Source: ILIN

Managembusiness. It noAnuntarumpo(mother) and chairman, madeals with neThe family owdirectly and v

ain businesses

ading (65% of% market sharr cables. Tradi10, thanks to ts and increasinmunication infbusiness offersof 22-23% an

ring business (2ne of business,

marine cabling

Revenue

NK, DBS Vickers

ment Composiow has three morn family, inclNuttanai (son)

ainly manages gotiations and

wns 54.7% of tia Interlink Ho

f FY15F revenure, ILINK is theng revenue hathe volume fro

ng investment rastructure. Ne

s relatively low nd 5-6% respe

22% of FY15F ILINK acts as aprojects, instal

breakdown F

ition. ILINK is amanaging direcuding Sombat). Sombat, alsoILINK’s operati

d Interlink Telecthe company’slding.

ue) number one ss grown every

om new office in evertheless, thegross and net ctively.

F revenue) an EPC contraclling transmissi

FY15F

a family-run ctors from t (father), Chalo the group’s ions while Nutcom’s operatios shares, both

seller y year

e profit

ctor ion

iii)

Sour

ida

ttanai ons.

lines to Thai19-20% GPM

) Telecom busThis businesslow. The twocentre rentaused by TRUinstitutions).and over 10revenue streare fixed cosinfrastructur

rce: ILINK, DBS V

Inte

land’s major isM and 14-15%

siness (13% ofs only began ino sub-units of l and fibre-optE and other pr The telecom b% NPM. The mams going forwsts (depreciatioe).

Major shar

Vickers

Com

terlink Com

slands. The pro% NPM.

f FY15F revenun late-13, so thtelecom busin

tic network, wrivate enterprisbusiness has omargin should rward as most on expenses of

reholders

mpany Focu

mmunicatio

oject work has

ue) he base is still ess are data hich is currentses (i.e. financiver 25% GPMexpand with of the expense

f telecom

us

n

ly ial

es

Pa

C

I

age 6

Company Fo

Interlink Co

Competitiv The mostsole distributoAMP cables inThe two branso customers their clients 2 One of thwiring project The only network. ILINcountry. This (30%) netwo(30-year leaseadvantage ovto 1) and henstealing marksuperior cove

Source: ILIN

ocus

ommunicat

ve Strengt

t dominant cabor of LINK cabln Thailand; botds have been are familiar w5-30 years of whe few playersts. There are ooperator in ThK has 35k km comprises botrk. ILINK is an

e with State Raver highway in ce fewer netw

ket share from rage (72 provi

Market sh

NK, DBS Vickers

tion

hs

ble seller in Thes and one of th LINK and AMin Thailand forith the brandswarranty.

s with track recnly two player

hailand with raof fibres (60x h the highwayexclusive owne

ailway of Thailaterms of fewe

work disruptionmain rival Symnces vs 44 pro

hare of cable

ailand. ILINK isthe four seller

MP are from thr around 30 ye. They also offe

cord of submars in Thailand t

ailway fibre-optcores) across t

y (70%) and raer of right of rand); railway her incident casens. ILINK has bemphony, thanksovinces).

sales 2014

s the rs of he US. ears, er

rine that

havDevonandElec

tic the ailway railway has the es (3 een s to its

ve performed uvelopment (ITDsubmarine pro

d Phangan Islactricity Author

Source: ILINK,

underground eD) and ILINK. Inojects to Kood nd (Bt800m) foity (PEA).

ILINK: C

K, DBS Vickers

electrical wiringn 2013-15, ILINand Mark Islaor Thailand’s P

Cable sales

g: Italian-Thai NK had workednds (Bt1.2bn) Provincial

d

Pa

age 7

Growth St Lacklustrsold outdoor resulting in a operators rareindoor cablesslower growthBt2.1bn, up 5 Samui IslWe expect ILISamui (Bt2.3bor May. The p(Bt800m) and20% and 88%business line.

Opportunrevenue fromincome streamand project w

Source: ILIN

trategies

e growth for tcables to TOT high base of c

ely order exter. The high bash in FY16F; we5% from Bt2.0

and, the growNK to win the bn), which shoproject should d FY17F (Bt1.5b% in the respe

nities in teleco telecom busin

ms are from fibworks.

Revenue

NK, DBS Vickers

trading businesworth Bt198m

cable sales in FYnal cables frome in FY15F leae have FY16F c0bn (+22% y-o

wth driver for esubmarine cab

ould be up for bbe realsed as rbn), representictive years in t

m business. Wness in FY16F (bre-optic netw

e growth by s

ss in FY16F. ILIm in 3Q-4Q15, Y15F since mo

m ILINK, a leadds us to expeccable sales of o-y) in FY15F.

ngineering wobling project tobidding aroundrevenue in FY1ng growth rat

this particular

We expect Bt96(+141 y-o-y). T

works, data cen

segment

NK

obile er of

ct

orks. o d April 16F tes of

63m The ntres

i)

ii)

iii)

The fibre-oprevenue, up much room utilised by TRexpects existinstitutions tbranches anbusinesses gcentre with finfrastructurand ILINK is The data cenfrom Bt20m ING group (2revenue in Soccupied.

The non-recfibre-to-the-operator plathis year. Of investmentslikely be instto be worth

Reve

Source: ILINK,

Inte

tic network is from Bt277m to grow as theRUE and otherting clients, mothat need interd ATMS, to usrow. ILINK alsofibre-optic netwe to access theone of the few

ntre is expectedin FY15F, than

200 racks) thatep-15; current

urring base is fhome (FTTX) pns to allocate the total Bt20in fibre-optic called by ILINK.Bt510m, up fr

enue breakdo

DBS Vickers

Com

terlink Com

expected to gin FY15F. Thi

e network is onr clients. The most of which arconnected IT sse more bandwo bundles its letwork. Clients eir outsourcedw operators th

d to contributenks to new leat just started gtly, 320 out of

from installatioproject for TRUBt20bn for FTT

0bn, Bt8.4-10bcables, some o. We expect throm Bt102m in

own (FY15F vs

mpany Focu

mmunicatio

enerate Bt393s business has nly 12-17%

management re financial systems for the

width when theeases of data need to use data centres,

at have both.

e Bt60m, up ases by TMB angenerating

348 racks are

on works such UE. The mobile TX installation

bn will be of which will e project work

n FY15F.

s FY16F)

us

n

m

eir eir

nd

as

k

Pa

C

I

age 8

Company Fo

Interlink Co

B

Source: ILIN

35%/11%the strong groexpect FY16F businesses hathe FY16F earThe profit grothere are poteunderground government’s Second dstart building first one is clocentre, 50:50Technology (Athe first one. end of this yeis not includestill unclear.

Source: ILIN

ocus

ommunicat

Breakdown o

NK, DBS Vickers

% earnings groowth of enginerevenue of Bt

ave higher marrnings growth owth is then exential upsides fwiring project

s national broa

data centre in tits data centre

ose to being fu owned by ILINAIT), will have ILINK plans to

ear, but the incd in our foreca

NK, DBS Vickers

tion

of telecom rev

owth in FY16Feering and tele3.9bn (+26%)gins than that should be eve

xpected to be from i) the sect in Bangkok, aadband project

the making. The within a few ully utilised. TheNK and Advanc600 racks, up complete the

come from theasts because it

Revenue

venue FY16F

F/FY17F. Thankecom business. Since the twoof the cable s

en higher at 3511% in FY17Fcond data centand iii) the t.

he company plmonths after t

e second data ced Informatiofrom 348 rackconstruction bsecond data c

s occupancy ra

ks to ses, we o ales,

5%. , but

tre, ii)

lans to the

on ks in by the centre ate is

Undean unbiddin16. Thshouldother to ouwith Sof 60 Natiorecenbroadgatewvillageservicto comcould enterpdevelowantsprivatwell.

TRUE q

Source: ILINK, T

rground wiringnderground wirng in Feb-16, ahe project (Bt2d be realised acompeting bid

r 2016-18 foreSamprasit, a ci:40 (ILINK: Sam

nal broadbandtly approved th

dband (Bt15bnway (Bt5bn). Thes nationwide e at minimum mplete the protake around 2

prises, TOT andop the last miles to finish the pte enterprises s

Source: ILINK,

quarterly roll

TRUE, DBS Vicker

g project in Baring project, wand the winner–2.5bn) involv

as revenue ovedders, and thisecasts. ILINK wvil contractor,

mprasit).

d project by thehe governmen) and Thailandhe governmentthe access to lspeeds of 30

oject within 12 24 months. Thed CAT Telecome of the infrastproject fast, it such as ILINK, S

Ea

DBS Vickers

lout of FTTX b

ers

ngkok. ILINK pwhich is tentativr should be anves 10km of wr 2-3 years. Ths project repres

will jointly bid fowith a revenu

e governmentnt’s Bt20bn budd’s internationat aims to provilow-cost broadmegabits per s months, but we two state te

m, are expectedtructure. If thewill likely needSAMTEL, AIT a

rnings

biddings

plans to bid forvely up for nounced by Ju

wiring work andhere are four sents an upsidor the project e sharing ratio

. The Cabinet dget for national internet de all 70,000

dband internetsecond; it aimswe believe it lecom d to help e government d help from and LOXLEY, as

r

un-d

e

o

nal

t s

s

Pa

age 9

Source: ILIN

Key Risks

Heavy rerevenue and 4LINK and AMto their list, ILcompetitors. Ibrands of cab Warrantswill expire on working day owarrant for 2implying a 7.7forecast.

Exercise peri

Expiration da

Exercise ratio

Exercise pric

Source: Compa

Gross

NK, DBS Vickers

liance on two 42% of net prP cables. If eith

LINK’s sales woIn the long run

bles to make up

s. ILINK has a 23 Jun 2016.

of each quarte.5 shares (exer7% dilution. W

Terms of

iods Last

ate

o

ce

any, DBS Vickers

capital expen

brands of cablofit in FY15F aher LINK or AMould be impactn, ILINK shouldp for the mark

set of 11,129,They can be e

er. The exercisercise price = Bt

We assume full

f warrants (ILworking day of

De23-Ju

1 warrant:

Bt8/sh

PE band

s

nditure

les. Around 65are contributedMP adds distribed by the new

d be able to finket share loss.

688 warrants texercised on the ratio is one t8 per share), dilution in our

INK-W1) Mar, Apr, Sep a

ec n-16

2.5 shares

hare

5% of d by butors w nd new

that e last

r

Va

ThediluyeaearmaMewirthis

and

Source: ILINK,

aluation

e fair value of tuted FY16F EPSar mean forwarnings prospectjor upside for

etropolitan Admring project (Bts year.

Re

Remaining w

Reserved sha

Full dilution

Inte

Earnings bre

K, DBS Vickers

this stock is BtS of Bt1.06. Thrd PE, and takets and upside four 2016-18 fministration’s C2.0-2.5bn) tha

emaining war

warrants

ares

PE t

Max

Min

+2SD +1SD +0.5SD Avg -0.5SD -1SD -2SD

Com

terlink Com

eakdown FY1

t20.20, based ohe target PE is es into accounfrom potentialforecasts is fromChong Non Seat should be up

rrants (ILINK-

11,129,6

27,824,2

7.7%

table

25.6

10.0

25.1 20.8 18.6 16.5 14.4 12.2 8.0

mpany Focu

mmunicatio

15F

on 19x fully-0.5SD over its

nt ILINK’s stron projects. The m Bangkok

ee undergroundp for bidding

W1)

688

221

%

us

n

3-g

d

Page 10

Company Focus

Interlink Communication

Segmental Breakdown FY Dec 2012A 2013A 2014A 2015F 2016F 2017F

Revenues (Btm)

Sales of indoor sales 1,289 1,463 1,641 1,999 2,099 2,400

Engineering 167 511 812 668 800 1,500

Telecommunication - 11 230 399 963 467

Total 1,457 1,985 2,683 3,067 3,862 4,367

Revenue (%)

Sales of indoor sales 89% 74% 61% 65% 54% 55% Engineering 11% 26% 30% 22% 21% 34% Telecommunication 0% 1% 9% 13% 25% 11%Total 100% 100% 100% 100% 100% 100%

Gross profit margin (%)

Sales of indoor sales 23.6% 25% 23% 23% 23% 23% Engineering 15.2% 18% 20% 20% 20% 20% Telecommunication N/A 30.6% 23.6% 32.0% 31.5% 32.0%Total 22.7% 23% 22% 24% 24% 23% Source: Company, DBS Vickers

Special order from TOT (Bt198m) led to high base in FY15F

Boosted by a non-recurring project (FTTX) for TRUE (Bt510m)

Page 11

Company Focus

Interlink Communication

Income Statement (Btm)

FY Dec 2012A 2013A 2014A 2015F 2016F 2017F

Revenue 1,457 1,985 2,683 3,067 3,862 4,469

Cost of Goods Sold (1,126) (1,527) (2,087) (2,342) (2,925) (3,427)

Gross Profit 330 458 595 725 937 1,041

Other Opng (Exp)/Inc (177) (247) (314) (339) (441) (495)

Operating Profit 153 211 281 385 496 547

Other Non Opg (Exp)/Inc 0.0 0.0 0.0 0.0 0.0 0.0

Associates & JV Inc 0.0 0.0 0.0 0.0 0.0 0.0

Net Interest (Exp)/Inc 0.0 0.0 (10.0) (28.6) (12.6) (9.0)

Exceptional Gain/(Loss) 0.0 0.0 0.0 0.0 0.0 0.0

Pre-tax Profit 153 211 271 357 483 538

Tax (37.0) (43.4) (51.7) (71.0) (96.7) (108)

Minority Interest 0.07 (0.7) (0.6) (0.9) (0.9) (0.9)

Preference Dividend 0.0 0.0 0.0 0.0 0.0 0.0

Net Profit 116 167 219 285 386 429

Net Profit before Except. 116 167 219 285 386 429

EBITDA 153 211 281 385 496 547

Growth

Revenue Gth (%) 10.5 36.3 35.1 14.3 25.9 15.7

EBITDA Gth (%) 31.3 37.6 33.3 37.0 28.7 10.3

Opg Profit Gth (%) 31.3 37.6 33.3 37.0 28.7 10.3Net Profit Gth (Pre-ex) (%)

42.1 43.3 31.2 30.2 35.4 11.3

Margins & Ratio

Gross Margins (%) 22.7 23.1 22.2 23.6 24.3 23.3

Opg Profit Margin (%) 10.5 10.6 10.5 12.6 12.8 12.2

Net Profit Margin (%) 8.0 8.4 8.2 9.3 10.0 9.6

ROAE (%) 16.2 16.4 15.8 16.9 17.6 15.8

ROA (%) 11.8 10.2 8.0 8.3 10.0 9.5

ROCE (%) 15.8 15.9 13.4 13.9 15.7 14.9

Div Payout Ratio (%) 42.5 8.7 3.3 40.0 40.0 40.0

Net Interest Cover (x) NM NM 28.2 13.5 39.4 60.8 Source: Company, DBS Vickers

Margins Trend

7.0%

8.0%

9.0%

10.0%

11.0%

12.0%

13.0%

14.0%

2013A 2014A 2015F 2016F 2017F

Operating Margin % Net Income Margin %

FY16F net profit growth is 35%, but we expect fully-diluted EPS growth of 25% due to dilution from of ILINK-W1

Page 12

Company Focus

Interlink Communication

Quarterly / Interim Income Statement (Btm)

FY Dec 2Q2014 3Q2014 4Q2014 1Q2015 2Q2015 3Q2015

Revenue 696 696 855 957 658 771

Cost of Goods Sold (542) (542) (654) (735) (494) (591)

Gross Profit 154 154 201 223 164 181

Other Oper. (Exp)/Inc (91.3) (91.3) (91.0) (77.8) (83.6) (93.2)

Operating Profit 63.0 63.0 110 145 80.8 87.6

Other Non Opg (Exp)/Inc 0.0 0.0 0.0 0.0 0.0 0.0

Associates & JV Inc 0.0 0.0 0.0 0.0 0.0 0.0

Net Interest (Exp)/Inc (1.9) (1.9) (8.1) (5.8) (8.1) (6.7)

Exceptional Gain/(Loss) 0.0 0.0 0.0 0.0 0.0 0.0

Pre-tax Profit 61.1 61.1 102 139 72.8 80.9

Tax (13.3) (13.3) (19.8) (27.5) (14.6) (16.1)

Minority Interest 0.03 0.03 (0.2) (0.8) (0.5) 0.39

Net Profit 47.8 47.8 81.9 111 57.7 65.2

Net profit bef Except. 47.8 47.8 81.9 111 57.7 65.2

EBITDA 63.0 63.0 110 145 80.8 87.6

Growth

Revenue Gth (%) (17.2) 35.9 22.9 12.0 (31.2) 17.1

EBITDA Gth (%) (16.2) 27.5 74.6 31.8 (44.2) 8.3

Opg Profit Gth (%) (16.2) 27.5 74.6 31.8 (44.2) 8.3Net Profit Gth (Pre-ex) (%)

(26.0) 26.1 71.2 35.4 (47.9) 13.0

Margins

Gross Margins (%) 22.7 22.2 23.5 23.3 25.0 23.4

Opg Profit Margins (%) 9.6 9.0 12.9 15.1 12.3 11.4

Net Profit Margins (%) 7.4 6.9 9.6 11.6 8.8 8.5

Revenue Trend

Source: Company, DBS Vickers

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

0

200

400

600

800

1,000

1,200

2Q2

013

3Q2

013

4Q2

013

1Q2

014

2Q2

014

3Q2

014

4Q2

014

1Q2

015

2Q2

015

3Q2

015

Revenue Revenue Growth % (QoQ)

Pa

age 13

Balance Sheet

FY Dec

Net Fixed Asset

Invts in Associa

Other LT Asse

Cash & ST Invts

Inventory

Debtors

Other Current A

Total Assets

ST Debt

Creditor

Other Current

LT Debt

Other LT Liab

Shareholder’s E

Minority Intere

Total Cap. & Li

Non-Cash Wkg

Net Cash/(Debt

Debtors Turn (a

Creditors Turn

Inventory Turn

Asset Turnover

Current Ratio (x

Quick Ratio (x)

Net Debt/Equity

Net Debt/Equity

Capex to Debt Source: Compa

t (Btm) 2

ts

ates & JVs

ets

s

Assets

Liab

ilities

Equity

sts

ab.

g. Capital

t)

avg days)

(avg days)

(avg days)

r (x)

x)

y (X)

y ex MI (X)

(%)

any, DBS Vickers

2012A 2013

240 71

0.68 0

10.3 24

421 27

145 16

206 25

48.2 53

1,070 2,19

0.0 0

258 62

29.3 24

0.0 24

18.9 24

760 1,27

4.31 2.2

1,070 2,19

112 86

421 24

55.3 42

68.5 106

40.0 37

1.5 1

2.9 1

2.2 0

CASH CAS

CASH CAS

N/A 1,280

s

3A 2014A

15 1,644

0.0 0.0

49 96.2

72 375

67 213

59 774

31 209

93 3,311

0.0 218

29 1,071

42 168

4.2 335

4.4 25.4

71 1,492

21 2.83

93 3,311

6.0 (43.3)

48 (177)

.8 70.3

6.0 148.6

.3 33.2

.2 1.0

.4 1.1

0.6 0.8

SH 0.1

SH 0.1

0.6 150.7

2015F 2

2,044 2

0.0

167

394

258

516

209

3,589 4

50.0

1,053 1

168

400

25.4

1,888 2

3.76

3,589 4

(239) (

(55.8)

76.7

165.5 1

36.7

0.9

1.1

0.7

0.0 C

0.0 C

133.3 3

016F 2017F

2,431 2,874

0.0 0.0

213 287

416 509

323 378

570 660

209 209

4,161 4,915

50.0 50.0

,317 1,540

168 168

100 200

25.4 25.4

2,497 2,926

4.69 5.61

4,161 4,915

(383) (462

266 259

51.3 50.2

47.9 152.1

36.3 37.3

1.0 1.0

1.0 1.0

0.6 0.7

CASH CASH

CASH CASH

333.3 232.4

Inte

F

4

0

7

9

8

0

9

5

0

0

8

0

4

6

5

)

9

2

3

0

0

7

H

H

4

Asset Br

Com

terlink Com

reakdown

mpany Focu

mmunicatio

us

n

Page 14

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Cash Flow Statement (Btm)

FY Dec 2012A 2013A 2014A 2015F 2016F 2017F

Pre-Tax Profit 153 211 271 357 483 538

Dep. & Amort. 15.1 26.4 68.4 92.8 114 138

Tax Paid (17.6) (20.2) (25.2) (27.7) (27.7) (27.7)

Assoc. & JV Inc/(loss) 0.0 0.0 0.0 0.0 0.0 0.0

Chg in Wkg.Cap. 57.0 20.9 127 195 144 79.3

Other Operating CF (26.7) (212) (238) 0.0 0.0 0.0

Net Operating CF 181 25.9 203 617 714 727

Capital Exp.(net) (106) (309) (832) (600) (500) (581)

Other Invts.(net) (20.8) 77.5 (52.6) 0.0 0.0 0.0

Invts in Assoc. & JV 0.0 0.0 0.0 0.0 0.0 0.0

Div from Assoc & JV 0.0 0.0 0.0 0.0 0.0 0.0

Other Investing CF 0.18 (233) 226 0.0 0.0 0.0

Net Investing CF (127) (465) (659) (600) (500) (581)

Div Paid (34.0) (49.5) (14.5) (7.3) (114) (154)

Chg in Gross Debt 0.0 24.2 528 (102) (300) 100

Capital Issues 0.0 386 0.0 112 223 0.0

Other Financing CF 4.38 0.05 10.6 0.0 0.0 0.0

Net Financing CF (29.6) 361 524 1.74 (191) (54.3)

Currency Adjustments 0.0 0.0 0.0 0.0 0.0 0.0

Chg in Cash 25.0 (77.7) 69.1 19.1 22.2 92.1

Opg CFPS (Bt) 0.41 0.02 0.24 1.26 1.63 1.79

Free CFPS (Bt) 0.25 (0.9) (1.9) 0.05 0.61 0.40 Source: Company, DBS Vickers

Capital Expenditure

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

800.0

900.0

2013A 2014A 2015F 2016F 2017F

Capital Expenditure (-)

Btm

Page 15

Company Focus

Interlink Communication

recommendations are based an Absolute Total Return* Rating system, defined as follows:

STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame)

BUY (>15% total return over the next 12 months for small caps, >10% for large caps)

HOLD (-10% to +15% total return over the next 12 months for small caps, -10% to +10% for large caps)

FULLY VALUED (negative total return i.e. > -10% over the next 12 months)

SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame)

Share price appreciation + dividends GENERAL DISCLOSURE/DISCLAIMER This report is prepared by This report is solely intended for the clients of DBS Bank Ltd and DBS Vickers Securities (Singapore) Pte Ltd, its respective connected and associated corporations and affiliates (collectively, the “DBS Vickers Group”) only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of . The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to DBS Bank Ltd., its respective connected and associated corporations, affiliates and their respective directors, officers, employees and agents (collectively, the “DBS Group”)) do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees, who should obtain separate independent legal or financial advice. The DBS Group accepts no liability whatsoever for any direct, indirect and/or consequential loss (including any claims for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. The DBS Group, along with its affiliates and/or persons associated with any of them may from time to time have interests in the securities mentioned in this document. The DBS Group may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other banking services for these companies. Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there can be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments. The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company (or companies) referred to in this report. The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED UPON as a representation and/or warranty by the DBS Group (and/or any persons associated with the aforesaid entities), that: (a) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and (b) there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk

assessments stated therein. Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies) mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to the commodity referred to in this report. DBS Vickers Securities (USA) Inc ("DBSVUSA")"), a U.S.-registered broker-dealer, does not have its own investment banking or research department, has not participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months and does not engage in market-making. ANALYST CERTIFICATION The research analyst(s) primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views. The analyst(s) also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of 27 Jan 2016, the analyst(s) and his/her spouse and/or relatives who are financially dependent on the analyst(s), do not hold interests in the securities recommended in this report (“interest” includes direct or indirect ownership of securities). COMPANY-SPECIFIC / REGULATORY DISCLOSURES 1. DBS Vickers Securities (Thailand) Co, Ltd and its subsidiaries do not have a proprietary position in the securities recommended in this report

as of 26 Jan 2016 2. Compensation for investment banking services:

DBSVUSA does not have its own investment banking or research department, nor has it participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA exclusively.

Page 16

Company Focus

Interlink Communication

RESTRICTIONS ON DISTRIBUTION

General This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

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Wong Ming Tek, Executive Director, ADBSR

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This research report is being distributed in The Dubai International Financial Centre (“DIFC”) by DBS Bank Ltd., (DIFC Branch) having its office at PO Box 506538, 3rd Floor, Building 3, East Wing, Gate Precinct, Dubai International Financial Centre (DIFC), Dubai, United Arab Emirates. DBS Bank Ltd., (DIFC Branch) is regulated by The Dubai Financial Services Authority. This research report is intended only for professional clients (as defined in the DFSA rulebook) and no other person may act upon it.

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Other jurisdictions In any other jurisdictions, except if otherwise restricted by laws or regulations, this report is intended only for qualified, professional, institutional or sophisticated investors as defined in the laws and regulations of such jurisdictions.

DBS Vickers Securities (Thailand) Co., Ltd.

989 Siam Tower, 9th, 14th-15th Floor,

Rama 1 Road, Pathumwan, Bangkok Thailand 10330

Tel. 66 2 657 7831, Fax: 66 2 658 1269