1. My Preliminary Thought
on the setting up of Vietnam JV
Presentation to the Management of
ABC Sdn. Bhd.
20 May 2012

2. Proposed Entry Planning Approach
Diagnostic (4 - 6 weeks)
Service Assessment
Product Assessment Sourcing strategy Entry Strategy
Develop or
Outsource To-be-cost
Market recommendation modeling
Attractiveness • Assessment of Strategic
• Market size and importance Entry Strategy
Service growth • Summary Business
• Assessment of Company
Suitability • Price bands and capabilities Suitable Site case
• Buyer value trends Identification • Sourcing strategy
• Investment requirements
analysis • Margins of existing • Industry clusters
• Make vs. Outsource
• Profile competing players • Supplier clusters
functional role
service • Industry outlook • Government incentives
• Medium term and long
• Analyse suitability
term strategies
for local mkt
• Adapt for local mkt
Regulatory
Ability to compete Distribution channels
• Industry structure environment
• Analyse prevalent network and • Government policies
• Key players and their
product and market mix Distribution channel structures • Legal and licensing
• Recommend channel structure requirements
• Regulatory environment strategy • Evaluate requirement of own
• Industry Critical • Subsidies and
structure v/s alliance options incentives
Success Factors

3. Proposed Entry Planning Approach
Detailed Evaluation and Planning ( 7 – 12 weeks)
Service Delivery Strategy Capability Requirements
Service Delivery Strategy Selection of
Distribution structure
• Network design Partners
• Channel selection • Selection of Alliance
Outsourcing • Infrastructure requirements partners
Provision of • Service provider • Project management Support process
Services identification & engineering & Infrastructure
• Capacity Planning • Service provider
• Turnkey contractors • Office infrastructure
• Greenfield project v/s qualification and selection
• Payroll, IT, Accounts,
acquisition
recommendation recommendation
g
• Job work v/s purchase for infrastructure
channel management
• Capital cost estimates • Contracting and service and Supply Chain
levels
process design
Human
• In-sourcing /
Tier I and II Resources
outsourcing
• Organization &
Service
competency model
Provider
• Identification • Recruitment needs
• Qualification
• Selection
Financials
• Investment estimates Marketing Execution
• Funding options (potential subsidies • Brand positioning • Detailed business case
Implementation
and incentives) • Value proposition • Implementation plan
Planning • Advertising strategy • Application for other licenses
• Profitability and Cash flow projections

4. Proposed Planning Process
1) 1st Meeting: Agreement on planning process
2) 1st Field Trip to compile information for the following activities:
i. Services Assessment
ii. Sourcing strategy
iii. Distribution strategy
iv. Entry Strategy
3) 2nd Meeting:
i. Report on the findings of the 1st field trips
ii. Perform situation analysis
• Mission
• Opportunities and threats
• Strengths and Weaknesses
• Critical issues for the future
iii. Form team to complete the plan
iv. Summarize situation analysis (between meetings)

5. Proposed Planning Process
5) 2nd Field Trip to compile information for the following activities:
i. Services Delivery Strategy
ii. Capability Requirements
iii. Implementation Planning
6) 3rd Meeting:
i. Report on the findings of the 2nd field trips
ii. Develop scenarios for the future (scenario approach)
• Develop scenarios (sketch of vision of success)
• Note areas of agreement and choices
ii. Summarize scenarios and choices (between meetings)
iii. Gather information to test feasibility of scenarios (between
meetings)

6. Proposed Planning Process
7) 4th Meeting:
i. Evaluate scenarios (e.g fit with missions, fit with needs)
ii. Evaluate financial feasibility
iii. Select the best scenario
iv. Develop first draft of business plan. Include sections on mission,
services, staffing, finances, facilities, and implementation (between
meetings)
8) 5th Meeting:
i. Review first draft of business plan. Note suggested improvements
ii. Revise first draft of business plan (between meetings)
9) 6th Meeting:
i. Review and approve final draft of business plan
ii. Implement plan and review progress every quarter
iii. Update plan every 6 months

7. Proposed Organisation Chart
Management
Board
Investment
Committee
CEO
Finance,
Public Human Legal Risk Information
Admin, Management Technology
Relations Resources Services
Legal
Equity
Stockbroking Wealth Asset
Advisory Market & Services
Research Management Management
Derivatives
Implementation Stages
- Stage 1 - Stage 1 and will be - Stage 2
separated in Stage 2

8. Stage 1
Finance &
Operations
 Creating management & Admin
Key Focus Areas
capacity from top to
bottom Information
Technology
 Creating profitable
business model
Set
 Installing information Up Research
systems and processes
 Managing risk
Stockbroking
 Managing and protecting Services
capital
 Creating the Brand Equity
Market &
Derivatives

9. Stage 2
 Creating additional
Key Focus Areas
Admin
Wealth
service lines Management
 Enhancing the revenue & Legal
cost models Services
Asset
 Enhancing operation Set Management
efficiency Up Public
Relations
 Improving information Advisory
systems and processes Risk
Management
 Enhancing return on
capital
 Improving the Brand

10. External Challenges
 By the end of 2006, there were 18 fund management companies and 55
securities companies competing based on brand name and reputation, service
quality, value added services, and fees. This is a sign of overcrowded.
 The stock market size is small with daily trading volume of only approx.
USD100 million and average brokerage fee is about 0.3%.
 In terms of brokerage and transaction market share, 5 biggest companies
including SSI, BVSC, VCBS, BSC and ACBS account for 70% of stock
brokerage, 80% of bond transaction and 65% of customers’ accounts.
 In terms of corporate advisory service, SSI, BVSC, VCBS and BSC overcome
other companies in attracting big corporations.
 By the end of 2006, the number of trading accounts stood at over 100,000
accounts, of which, 1,700 accounts were foreign investors. The foreign
investors hold 25% to 30% of the total number of listed shares, in which there
were some international securities investment firms like JP Morgan, Merrill
Lynch, Citigroup, BNP-Paribas Singapore, and Credit Suisse Hong Kong.

11. External Challenges
 With the crowded situation in the financial industry, there will a stiff competition
among the employers to compete against each other to attract the best talent.
 The fee for order entry error correction is expensive (VND500,000 for every
correction).
 Local investors understanding about financial products and services are limited.
 Share prices have become less attractive after the sharp increases in
September 2007. Supposed that the EPS growth rate would be 30% in 2007
and 20% in 2008, the PE index would be 23 for the next 12 months. This is a
sign of overvaluation.
 Strict restriction imposed on share financing and the total lending exposure of
each bank is to be kept below 3% of total outstanding loans.
 Under the personal income tax bill, a 25% capital gain tax and 5% tax on
dividends will be imposed on securities investors.

12. External Challenges
 SSI, the market leader, to provide better services, will invest in a new online
trading system from IBM, Cisco, FreeWill and international software giant
Oracle, worth US$1.3 million.
 Inflation rate increased sharply to 9.3% in October 2007, thus raising the
concern among investors that the Government would tighten monetary policies.
 70% of all lending activities belong to the four main state-owned commercial
banks: BIDV, Vietcombank, Incombank and VBARD. Foreign banks and joint
ventures accounted for about 14% of lending activities. Restrictions on raising
deposits in VND prevent a level playing field and, accordingly, the market share
expansion has been slow.
 In 2006, 41 of 64 H5N1 (“bird flu”) deaths reported in Vietnam, 25 of 64
provinces affected in Vietnam.

13. External Challenges
 The market is concentrated and not competitive. SOEs
occupy monopoly positions in key industries like electricity,
aviation and telecommunications with a market share of at
least 80%. Other heavily-regulated industries tend to have
some foreign and private-sector participation but are
dominated by a state-owned oligopoly where several large
firms have a market share of 10-40% each. These
industries include cement, sugar, minerals, banking and
petroleum, in which prices tend to be high and most firms
are neither efficient nor competitive.

14. Other Challenges
 Compiling a detail list of Vietnamese companies with potential to become future
IPO candidates that are currently serving Build-Operate-Transfer (BOT) projects
or foreign companies located in Industrial Zones (IZ), Export Processing Zones
(EPZ) and High Technology Zones (HTZ).
 Form alliances with private equity firms from Europe, US and Japan to co-invest in
Pre IPO opportunities in Vietnam.
 Form alliances with other stockbroking firms and fund management houses based
in ASEAN countries to attract foreign investors and to strengthen our firm
distribution networks.
 Winning advisory mandates from state-owned enterprises (SOEs) with the
potential to become future IPO candidates.
 Under the law, the total number of foreign employee is restricted to the lower of
3% of the total number of employees or 50 individuals.
 Trade unions are a powerful political and economic force in Vietnam and strikes
are very common.

15. THANK YOU