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    • Japanese Equities Target Strategy Unlocking Shareholder Value in Japan Hiromitsu KAMATA Head of Japanese Equity Target Department Citywire Montreux, 09-11 May 2012  Morningstar Rating TM- OverallThis material is solely for the attention of “professional” investors (seemore details and definitions at the end of the presentation).
    • Table of Contents 1. Executive Summary 2. Investment Case 3. Japan Target Approach 4. Conclusion Citywire Montreux - May 2012 - page 2
    • Executive SummaryActive management with no benchmark constraint, benefiting from thecorporate context which plays in favor of shareholders1 Fundamental active management2 through a pure bottom-up process – Investing in undervalued cash rich companies deemed capable of increasing shareholder value. Small caps bias as a result of the process. – Good resistance in downsides thanks to this deep value strategy and insulation to some extent from broad market flows dynamic3 A team of 4 managers/analysts – Mr Kamata, Head of Japanese Equity Target department and manager of the strategy since 2002 Hiromitsu KAMATA (18 years experience) – AuM of the strategy: € 253M Recognised and proven expertise 1st quartile over 5 years Source : Amundi - 1 The sub-fund offers neither capital nor performance guarantee. 2. Given for illustrative purpose only, may bechanged without any prior notice 3. Past market behaviours do not prejudge future behaviours. Data as at 31/03/2012 Citywire Montreux - May 2012 - page 3Lipper is not responsible for the accuracy, reliability or completeness of the information that you obtain from Lipper. In addition, Lipperwill not be liable for any loss or damage resulting from information obtained from Lipper or any of its affiliates. © Thomson Reuters 2011.Morningstar, All rights reserved..Data Source - ©[2012] Morningstar, Inc. All Rights Reserved
    • Table of Contents 1. Executive Summary 2. Investment Case 3. Japan Target Approach 4. Conclusion Citywire Montreux - May 2012 - page 4
    • Japan market: a stock picker’s dreamJapan equity market hides value Low valuations exacerbated by Japan market marginalization – Valuations at “historical lows” and very attractive on asset-based measures Access to quality businesses – Quality companies, sometimes niche market leader companies are among these undervalued companies Market presents inefficiencies – Market is under-researched: out of 3500 companies, a majority have no or very thin sell-side coverage Japan market has been overlooked and as result offers plenty of opportunitiesPast behaviour do not prejudge future behaviour Citywire Montreux - May 2012 - page 5
    • A new trend is at play in favor of shareholdersUnwinding of cross-shareholdings set the ground for shareholderactivism leading to higher dividends and increasing share buy-backs1 Ratio of cross-shareholdings in Japan  Traditional shareholders 60 Bought shares for the purpose of cementing alliances rather than earning a return. 50 40  Outsider shareholders 30 Interested to earn a return 20 Have been lobbying for higher dividends & value-enhancing share buybacks. 10 0 1950 1958 1966 1974 1982 1990 1998 2006 Cross- held shares (%) Foreign ownership (%) A new and improved shareholder statusRatio includes securities hold by insurance companies. Calculated by Amundi Japan,using data provided by Daiwa Institute of Research, Nomura Securities FinancialResearch Center and Tokyo Stock Exchange.For illustrative purposes onlyPast behaviour do not prejudge future behaviour Citywire Montreux - May 2012 - page 61. Neither capital nor performance guarantee.
    • Shareholders now rewarded in line with company profits Outsider shareholders push for higher dividends and increasing share buy-backs  Shareholders have successfully lobbied for higher dividends and value-enhancing share buy-backs Dividends, share buy-backs on the rise in Japan (Unit : Tril.Yen) 8 Share Buy-backs Dividends 6 4 2 0 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 (F)Source: Amundi Japan compiled by Nomura Securities. Universe = all listed companies. Citywire Montreux - May 2012 - page 7
    • Table of Contents 1. Executive Summary 2. Investment Case 3. Japan Target Approach 4. Conclusion Citywire Montreux - May 2012 - page 8
    • Key attributes - cash rich, low debt, low PBRUndervalued companies with cash-rich balance sheets deemed capableof increasing shareholder value Portfolio Adjusted PBR Evolution Japan Target TOPIX 1,1 Jan 06: 1.06x Inexpensive 0.63x 1.07x PBR 1 Adjusted PBR 0.65x 1.66x 0,9 Low level of debt 10% 116% Debt/Equity Ratio 0,8 Mar 12: Cash + Securities position 83% 48% 0,7 0.65x (% of Market cap) Capacity to distribute 0,6 Dividend Capacity 87% 39% (% of Market cap) 0,5 Feb 09: 0.54x Share Buyback Potential (% of Market cap) 112% 53% 0,4 2003 2004 2005 2006 2007 2008 2009 2010 2011 Small cap bias  Half of portfolio holdings are not Weighted average JPY 84 Bn JPY 1,759 Bn covered by the sell-side Market CapitalisationSource: Data as of end March 2012. Calculated by Amundi Japan, using data provided by Nomura Research Institute Citywire Montreux - May 2012 - page 9PBR = Price to book Ratio
    • Two Keys to stock-selection…… Conservative valuation and shareholder-friendly All listed companies (approx. 3,500 stocks) QUANTITATIVE SCREENING Conservative approach: Identify undervalued cash rich companies adjust for off balance sheet  PBR and Adjusted PBR debt items and uncertain  Debt/Equity ratio and cash + securities position assets Universe  Dividend capacity, share buyback potential (200-300) Shareholder-friendly FUNDAMENTAL RESEARCH Select the most attractive profiles companies: We do not invest  Asset quality, cash flows in companies which are not Buy-List capable of, or interested in,  Shareholder composition, management quality (50-150) returning value to  Competitiveness of core business shareholders. Final portfolio features – Extremely undervalued stocks & small caps bias Portfolio – Super cash rich, healthy balance sheet companies Confidence added to the (50-100) = – 60% annual turnover strategy – Lower volatility than reference indexFor illustrative purposes only. Citywire Montreux - May 2012 - page 10
    • Key attributes - cash rich, low debt, low PBR Mabuchi Motors Electrical machinery  World’s largest manufacturer, over 20% market share, of small electric motors Portfolio Top 10 Holdings  It has an output of some 2 billion such motors a Cash/ D/E year. Company Weight PBR M. Cap. Ratio  The company has the unusual distinction of Sekisui Jushi 2.4% 0.69x 72% 6% manufacturing all its products overseas, NEC System 2.4% 0.92x 76% 25% particularly in China. Mabuchi Motors 2.3% 0.84x 74% 0% Cash/M.cap: 74% D/E: 0% PBR: 0.84x Amada 2.3% 0.60x 67% 4% Sanki Engineering 2.3% 0.44x 198% 14% Kissei Pharmaceutical 2.1% 0.75x 77% 4% Zojirushi Appliances Nippon Shinyaku 2.1% 0.94x 45% 12%  Japan’s top maker of Rice cookers with a MS&AD Insurance 2.0% 0.82x - - market share of 30% Kagoshima Bank 2.0% 0.47x - -  Has expanded into pot kettles, hot plates… Japan Digital Labo 2.0% 0.44x 180% 18%  Overseas sales account for 20% of total Total 21.9%  Half of its production is made overseas so Zojirushi 0.7% 0.55x 78% 24% foreign exchange risk is reduced Cash/M.cap: 78% D/E: 24% PBR: 0.55xSource: Amundi Japan – Holdings Data as of end-March 2012Cash+Securities position (% of market cap)=Cash/M.Cap – Debt/Equity Ratio =D/E – adjusted PBR = PBR Citywire Montreux - May 2012 - page 11
    • Rewarding shareholders is often the trigger that unlocks ValueMaruwa is an electronics product manufacturer Stock neglected by the market Catalyst happening Re-rating by the market4000 1,60 Position Position built closed3500 1,40 1,203000 1,002500 1st sell-side coverage initiation as a Buy 0,802000 0,601500 0,40 2nd sell-side coverage1000 initiation as a Buy 0,20 500 - févr 07 Feb 07 août 07 Aug févr 08 Feb 08 août 08 Aug 08 févr 09 Feb 09 août 09 Aug févr 10 Feb 10 août 10 Aug 10 févr 11 Feb 11 août 11 Aug 11 Maruwa share price Maruwa Price to Book ratio Share buy back for respectively 2.8% and 1%For illustrative purposes only.Source: Amundi Japan. Citywire Montreux - May 2012 - page 12
    • Sometimes, poor management means we have to give upNagase is Japan’s largest specialized trading company of chemical products Stock neglected by the market Waiting for a catalyst to happen Exit1800 1,1 Position Position built closed1600 1 0,91400 0,81200 0,71000 0,6 800 0,5 600 0,4 400 07 Jun Dec 07 Jun 08 Dec 08 Jun 09 Dec 09 Jun 10 Dec 10 Jun 11 Dec 11 0,3 Nagase share price Nagase Price-to-book ratio Company announces a € 700mn takeover of Hayashibara, a biotech companyFor illustrative purposes only.Source: Amundi Japan. Citywire Montreux - May 2012 - page 13
    • Japan Target Strategy: GIPS composite performanceCalendar Year Performance – Over-performance vs Topix for 8 years out of 10 – Resilience in downfall market 50% 45.2% 41.5% 39.3% 40% 33.6% 30% 25.2% 20% 16.2%18.6% 11.0% 10.1% 11.3% 8.0%7.6% 10% 3.0% 3.2% 1.0% 0% -10% -7.2% -9.6% -11.1% -9.2% -20% -17.5% -17.0% -18.9% -19.7% -30% -40% -40.6% -50% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Japan Target Strategy Topix dividends reinvestedData as of end- March 2012, performance does not prejudge future results, nor is it a guarantee of futurereturns. Performances are gross of fees Citywire Montreux - May 2012 - page 14
    • Amundi Funds Equity Japan Target – AJ1 (C): Performance Since Inception Competitive position Net Performance From 15/01/2004 to 31/03/2012 1st quartile over 5 years Amundi Funds Equity Japan Target IJ (C) 21.42% TOPIX (RI) dividends reinvested - 6.06%  Net Outperformance 27.48 %  NAV Evolution (basis 100): Since Inception 190 150 10 1 70 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12  Amundi Funds Equity Japan Target  TOPIX Dividends reinvestedData as of end -March 2012, net of fees. Past performance does not prejudge future results, nor is it a guarantee of future returns.1 Share Class Citywire Montreux - May 2012 - page 15Lipper is not responsible for the accuracy, reliability or completeness of the information that you obtain from Lipper. In addition, Lipper willnot be liable for any loss or damage resulting from information obtained from Lipper or any of its affiliates. © Thomson Reuters 2011.Morningstar, All rights reserved..Data Source - ©[2012]
    • Amundi Funds Equity Japan Target – AJ1 (C): Competitive PositionPerformance / volatility over 5 years: a tried and tested expertise 20 10 Performance 5Y (%) 0 -10 -20 -30 -40 -50 -60 -70 12 17 22 27 32 37 Ann. Volatility 5Y (%) Citywire Montreux - May 2012 - page 16Source: Lipper Insight. .Past performance does not prejudge future results, nor is it a guarantee of future returns.Data as of 30/03/2012,1 Share Class
    • Table of Contents 1. Executive Summary 2. Investment Case 3. Japan Target Approach 4. Conclusion Citywire Montreux - May 2012 - page 17
    • A proven approach that makes the most of Japan market  Japan Target strategy harnesses opportunities that can be found in the Japanese market as a result of its marginalization  The strategy has a track record of outperforming the Japan Equity market in both rising and falling markets  Helped by our understanding of such key issues like governance in Japan, we have been focusing on stocks that reward shareholders : this has led to higher investment returns  …with a lower volatility and strong resilience in most market conditionsPast performance does not prejudge future results, nor is it a guarantee of future returns. Citywire Montreux - May 2012 - page 18
    • DisclaimerThis document contains information about Amundi Funds Equity Japan Target a sub-fund (the “Sub-Fund”) of Amundi Funds (the“Sicav”), an undertaking for collective investmentin transferable securities existing under Part I of the Luxembourg law of 17 December 2010, organised as a société d’investissement à capital variable and registered with theLuxembourg Trade and Companies Register under number B68.806. The SICAV has its registered office at 5, allée Scheffer, L-2520 Luxembourg.Amundi Funds has been authorised for public sale by the Commission de Surveillance du Secteur Financier in Luxembourg.Not all sub-funds of the SICAV will necessarily be registered or authorized for sale in all jurisdictions or be available to all investors.Subscriptions in the Sub-Fund will only be accepted on the basis of the SICAV’s latest complete and simplified prospectus, its latest annual and semi-annual reports and its articlesof incorporation that may be obtained, free of charge, at the registered office of the SICAV or respectively at that of the representative agent duly authorized and agreed by therelevant authority of each relevant concerned jurisdiction.Consideration should be given to whether the risks attached to an investment in the Sub-Fund are suitable for prospective investors who should ensure that they fully understandthe contents of this document. A professional advisor should be consulted to determine whether an investment in the Sub-Funds is suitable.The value of, and any income from, an investment in the Sub-Fund can decrease as well as increase. The Sub-Fund have no guaranteed performance. Further, past performanceis not a guarantee or a reliable indicator for current or future performance and returns. The performance data do not take account of the commissions and costs incurred on theissue and redemption of units.This document does not constitute an offer to buy nor a solicitation to sell in any country where it might be considered as unlawful, nor does it constitute public advertising orinvestment advice.The information contained in this document is deemed accurate as at May 2012.This material is solely for the attention of institutional, professional, qualified or sophisticated investors and distributors. It is not to be distributed to the general public, privatecustomers or retail investors in any jurisdiction whatsoever nor to “US Persons”.Moreover, any such investor should be, in the European Union, a “Professional” investor as defined in Directive 2004/39/EC dated 21 April 2004 on markets in financialinstruments (“MIFID”) or as the case may be in each local regulations and, as far as the offering in Switzerland is concerned, a “Qualified Investor” within the meaning of theprovisions of the Swiss Collective Investment SchemesOrdinance of 23 June 2006 (CISA), the Swiss Collective Investment Schemes Ordinance of 22 November 2006 (CISO) and the FINMA’s Circular 08/8 on Public Offering withinthe meaning of the legislation on Collective Investment Schemes of 20 November 2008. In no event may this material be distributed in the European Union to non“Professional” investors as defined in the MIFID or in each local regulation, or in Switzerland to investors who do not comply with the definition of “qualified investors” as definedin the applicable legislation and regulation. Morningstar Data Source - ©[2012] Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. The rating concerns the (share) class. Data as at April 2012. Amundi, French joint stock company (“Société Anonyme”) with a registered capital of € 584 710 755 and approved by the French Securities Regulator (Autorité des Marchés Financiers-AMF) under number GP 04000036 as a portfolio management company 90 boulevard Pasteur -75015 Paris- France – 437 574 452 RCS Paris. www.amundi.com www.amundi-funds.com Citywire Montreux - May 2012 - page 19