Agm 2011 Ceo Presentation(05042011)

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  • 1. Annual General MeetingCEO Presentation to ShareholdersApril 25, 2011
  • 2. 3-yearleadershipvision #1 #1 30% place for talent in Vietnam 5% return per in each annum vertical for ourof Vietnams shareholdersGDP andUS$500million ofcashflows
  • 3. A: Vietnam Tomorrow TodayQ: What is the strategy andvision to achieve this?
  • 4. “The universe isasymmetric.” Louis Pasteur
  • 5. Everyone sees Vietnamsobvious consumption story 2010 Packaged food and beverages per capita USD per annum 2010 GDP per capita USD PPP thousands Source: Euromonitor; Global Financial Stock database; USGS; BGR Coal; Austrade; Vinacomin; Lit search
  • 6. But the privatesector is toofragmented 2.9%Avg. size of top20 private sector 2.2% 2.2%companies as %of 2010 GDP 1.5% 0.5% Vietnam Indonesia Philippines India Thailand Source: EIU; Euromonitor; Global Insight; MGI; WDI; Bloomberg; IMF World Economic Outlook Database; Team analysis
  • 7. Capital markets areundeveloped 33,367Avg. size of top 20 listedcompanies (US$ mm) 11,565 9,643 5,221 1,081 Vietnam Philippines Thailand Indonesia India Source: EIU; Euromonitor; Global Insight; MGI; WDI; Bloomberg; IMF World Economic Outlook Database; Team analysis
  • 8. And overcompetitive…. Profit before tax Net turnover Profit before tax (margins %) 5.2% = average 5.8% State-owned enterprises 1.2% Local private sector Foreign-owned/ 12.2% partnerships Source: EIU; Euromonitor; Global Insight; MGI; WDI; Bloomberg; IMF World Economic Outlook Database; Team analysis
  • 9. A: The private sectorneeds a consolidator.Q: How can Masan builda consolidator?
  • 10. “Change beforeyou have to.” Jack Welch
  • 11. Selecting only the scalable sectors wherea local private sector company can dominateLargest local private sector companies in more developedAsian economies are multi-billion market cap businesses Consumer Financial services Resources US$3.0bn US$28.3bn US$9.0bn US$14.5bn US$56.1bn US$16.2bn US$5.5bn US$21.0bn US$8.2bn Source: Bloomberg
  • 12. Do less butgo deep 70%+ market share of key products Fastest growing ATM and branch network, #1 ROAE One of the largest tungsten mines outside China
  • 13. Not enough to be “Vietnam Plus”……we have to be “Global Standard” Professional Strategy management Risk management Corporate Operational governance Reputable platform partners
  • 14. Consolidation Consolidate Vietnams Consolidate private Consolidate sectors of sector stakes in existing with new existing businesses verticals businesses
  • 15. The “Masan Way”Getting the best personfor each job and Risk management &partnering to deliver capital allocation Local access & execution Professional operators
  • 16. A: Build the bestoperating platforms.Q: But how do wesurvive the volatilemacro environment?
  • 17. “You have to eatwhile you dream” Jack Welch
  • 18. Businesses have togrow and make money 25% 43% 69% Return on Average77% 2010 Gross margin 2006-2010 Net Income CAGR Equity #1 Vietnam2006-2010 #1 Vietnam Top in regionRevenueCAGR#1 Vietnam
  • 19. Investors and Partners withdeep pockets – access to capital
  • 20. Ruthless capital allocationSince 2009Sources (US$ mm) Uses (US$ mm)Consolidated cash raised ~555 Increasing stakes in existing ~212 businesses & deleveragingInternally generated cash ~138 Nui Phao funding commitments ~130 Masan Consumer ~57 capital expenditure Masan Consumer ~49 planned debt payments ~693 ~448 Current cash for M&A and investments: US$245mm
  • 21. A: Making money isimportant and savingeven more.Q: But is it enough to be“Vietnam Plus”?
  • 22. “We have themjust where theywant us” Capt James T Kirk Starship Enterprise
  • 23. The world is flat – theregional leaders are coming Consumer Financial services Resources US$8.1bn US$39.1bn US$25.1bn Nestle India State Bank NMDC US$14.5bn US$260.1bn US$93.2bn Tingyi ICBC China Shenhua US$5.5bn US$21.0bn US$8.2bn Indofood BCA Adaro Energy US$4.9bn US$26.9bn US$26.6bn Asia Pacific Breweries DBS Group Wilmar US$6.9bn US$13.0bn US$7.0bn CP Group Siam Comm Banpu Pub US$11.2bn US$21.9bn US$7.5bn IOI Corp Bhd Maybank Petronas Gas Source: Bloomberg
  • 24. We benchmarkourselves to the best
  • 25. We have deliveredhigh returns and growth 2010 ROE 33% 29% 37% 11% 10% 2006-2010 net profit CAGR 155% 34% 30% 24% 37% 2006-2010 net profit CAGR 69% 28% 21% 19% 40% Source: Bloomberg; audited reports
  • 26. But we have not achievedrelative scale yet ... EV / GDP 2.2% 7.8% 3.7% 23.3% 6.3% Market Cap US$bn 1.6 14.5 11.9 4.1 10.2 Book Value US$bn 0.5 4.8 2.1 3.8 20.3 Source: Bloomberg; audited reports
  • 27. A: We have to achievescale withoutsacrificing returns.Q: This is all mediumterm – why should I buyyour stock today?
  • 28. “Be fearful whenothers are greedyand greedy whenothers are fearful.” Warren Buffet
  • 29. Liquidity is drying up Increase in borrowing costs Decrease in trading value
  • 30. We are ready for theshakeout 3 market leading operating platforms Tested risk management platform War chest of US$250-500mm for investing and M&A
  • 31. A: Solid fundamentalbusinesses + capitalQ: But isnt there morethan just strategy forMasan to succeed?
  • 32. “Talent wins games,but teamwork andintelligence winschampionships.” Michael Jordan
  • 33. A chairmanwith visionDr. Nguyễn Đăng Quang
  • 34. Our leadership Mr Hồ Hùng Anh Mr Nguyễn Đức Vinh Mr Trương Công Thắng Vice-Chairman Masan Group CEO Techcombank CEO Masan Consumer Mr Dominic Heaton Mr Nguyễn Thiều Nam CEO Masan Resources Deputy CEO Masan Group
  • 35. Our team
  • 36. “I think this is the startof something really big.Sometimes that firststep is the hardest one,and weve just takenit.” Steve Jobs