台表科(6278 tt) daiwa2011.6.16[1]

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台表科(6278 tt) daiwa2011.6.16[1]

  1. 1. Electronics / Taiwan 15 June 2011 Target price: NT$87.00 → NT$117.00Taiwan Surface Mounting Technology Up/downside: +31.2%6278 TT Share price (14 Jun): NT$89.20More than simply an LED-lightbarstory• We forecast TSMTs sales to rise at a CAGR of about 30% and profitability to improve for 2011-13 on new business ventures• In addition to LED lightbars, we forecast new businesses to account for 24% of sales for 2012• Buy reaffirmed; target price raised to NT$117, 31% upside potential How do we justify our view? the improving profitability (as such, its true value, with its strong execution we have revised up our 2013 EPS and ability to move ahead of the trend. forecast by 12.6%) from these new businesses for the next three years. Forecast revisions (%) Year to 31 Dec 11E 12E 13EChris Lin Revenue change 0.4 1.1 11.3 What we recommend(886) 2 8788 1614 Net-profit change (4.9) 2.9 12.6chris.lin@daiwacm-cathay.com.tw The share price has reached our prior EPS change (4.9) 2.9 12.6 target price as investors have started Source: Daiwa forecastsJenkins Shiau to price in the LED-lightbar story. We(886) 2 8789 5105jenkins.shiau@daiwacm-cathay.com.tw have raised our six-month target price Share price performance to NT$117.0 (from NT$87.0), based on a new target PER of 12x (10x Whats new previously) and the average of ourWhile our investment thesis of rising 2011 and 2012 EPS forecasts ofdemand for LED lightbars (49% of the NT$8.32 and NT$11.18, respectively.company’s 2011E sales) remains intact, We believe TSMT deserves a target 12-month share-price performancewe believe Taiwan Surface Mounting PER of 12x for three reasons: 1) the Relative to Taiwan TAIEX IndexTechnology (TSMT) deserves a further tablet-rerating story, 2) potentiallyrerating, as we expect a substantial strong EPS growth in 2012 for the 12-month range 60.10-91.30rise in the contributions from its new new businesses, thanks to order wins Market cap (US$m) 676.08businesses in: 1) inverter-type printed from Philips and subsidy programmes Average daily turnover (US$m) 8.64circuit board and assembly (PCBA) for in China, as well as China promoting Shares outstanding (m) 218white goods in China, and TV-set energy-saving home appliances in its Major shareholder Wang Ying Pa (3.3%)mainboards for China brands, and 2) 12th Five-Year Plan, and 3) a 12x PERthe electronic manufacturing services is still at about a 15% discount to the Financial summary (NT$)(EMS) business for LED general current PER of the LED companies Year to 31 Dec 11E 12E 13E and home-appliance makers, as TSMT Revenue (m) 52,514 68,196 87,215lighting. Operating profit (m) 3,445 4,880 6,384 is not a pure play in either sector. We Net profit (m) 1,817 2,443 3,108 Whats the impact see the main downside risk as a Core EPS 8.316 11.184 14.226Despite the slight 5% downward slower-than-expected ramp-up of the EPS change (%) 9.3 34.5 27.2revision to our 2011 EPS forecast to new business ventures. Daiwa vs Cons. EPS (%) n.a. n.a. n.a.factor in higher-than-expected initial PER (x) 10.7 8.0 6.3setup costs and operating expenses How we differ Dividend yield (%) 2.6 2.3 3.1associated with new facilities, we We were the first non-Taiwan broker DPS 2.324 2.026 2.753believe the market should factor in not to initiate coverage of TSMT and PBR (x) 1.6 1.4 1.3only the top-line CAGR of about 30% believe it remains under-covered. We ROE (%) 16.4 19.0 21.8that we forecast for 2011-13, but also expect the company to become more Source: Bloomberg, Daiwa forecasts widely covered as investors recogniseImportant disclosures, including any required research certifications, are provided on the last two pages of this report.
  2. 2. Electronics / Taiwan 6278 TT 15 June 2011 How do we justify our view? Growth outlook Valuation Earnings revisions Growth outlook TSMT: sales and gross profit (2009-13E)We forecast TSMT’s sales to rise at a CAGR of about (NT$m) (%)30% for 2011-13 and its profitability to improve over the 100,000 10.6same period on rising shipments, and in particular, an 90,000 10.4increasing sales contribution from its new businesses in 80,000 10.2 70,000LED general lighting and home appliances. 60,000 10.0 9.8 50,000 9.6In addition to LED lightbars (the main driver of TSMT’s 40,000 30,000 9.4revenue growth this year, in our view), we believe the 9.2 20,000market should start factoring in the company’s new 10,000 9.0businesses, which we forecast to account for 24% of its 0 8.82012 sales (10% from LED general lighting, 8% from 2009 2010 2011E 2012E 2013ETV-set mainboards, and 6% from white goods). Sales (LHS) Gross Margin (RHS) Source: Company, Daiwa forecasts Valuation TSMT: one-year forward PER bandsThe share price has reached our previous target price as (NT$)investors have started to price in the LED-lightbar story. 100 10xWe have raised our target price to NT$117.0, based on a 90new target PER of 12x and the average of our 2011 and 80 8x2012 EPS forecasts of NT$8.32 and NT$11.18, respectively. 70We believe TSMT deserves a 12x target PER for three 60 6xreasons: 1) the tablet-rerating story, 2) potentially strong 50EPS growth in 2012 for new businesses, thanks to order 40 4xwins from Philips (Not rated) and two subsidy 30 20programmes in China, as well as China’s promoting of 10energy-saving home appliances in its 12th Five-Year Plan, Jan-07 Jan-08 Jan-09 Jan-10 Jan-11and 3) a 12x PER is still at about a 15% discount to thecurrent PER at which the LED companies and home- Source: Company, Daiwa forecastsappliance makers are trading. Earnings revisions TSMT: Daiwa forecast revisionsCapacity expansion for new businesses should result in New Previous Diff. (%) (NT$m) 201E 2012E 2011E 2012E 2011E 2012Eslightly higher operating costs, along with additional Sales 52,514 68,196 52,290 67,463 0 1costs associated with setting up new facilities in 2011, Gross profit 5,008 6,800 5,072 6,775 (1) 0than we expected previously. As such, we have revised Margin (%) 9.5 10.0 9.7 10.0down our 2011 EPS forecast by a mild 5%. Operating profit 3,445 4,880 3,641 4,683 (5) 4 Margin (%) 6.6 7.2 7.0 6.9 Pre-tax profit 3,516 4,941 3,712 4,737 (5) 4Nonetheless, we forecast a top-line CAGR of about 30% Margin (%) 6.7 7.2 7.1 7.0for 2011-13 with an additional sales contribution from Net income 1,817 2,443 1,910 2,374 (5) 3the new businesses. To reflect the improving Margin (%) 3.5 3.6 3.7 3.5profitability from rising shipments of higher gross- EPS (NT$) 8.32 11.18 8.74 10.87 (5) 3margin products, we have revised up our 2012 and 2013 Source: Daiwa forecasts Note: net income is after minority interestsEPS forecasts by 2.9% and 12.6%, respectively. -2-
  3. 3. Electronics / Taiwan 6278 TT 15 June 2011Financial summary Key assumptions Year to 31 Dec 2006 2007 2008 2009 2010 2011E 2012E 2013E LCD Control Board Shipment (mn units) 138 147 168 214 246 256 LED lightbar shipment (mn units) 12 46 88 127 147 160 TV set board (mn units) 0 0 2 13 21 26 Profit and loss (NT$m) Year to 31 Dec 2006 2007 2008 2009 2010 2011E 2012E 2013E LCD Control Board 13,953 19,314 17,118 20,713 22,779 22,067 23,927 23,769 LED lightbar 0 0 1,669 8,797 16,933 25,573 28,429 29,306 Others 0 0 0 0 853 4,874 15,840 34,140 Total revenue 13,953 19,314 18,787 29,511 40,565 52,514 68,196 87,215 Other income 0 0 0 0 0 0 0 0 COGS (12,436) (17,244) (16,806) (26,743) (36,475) (47,506) (61,396) (78,203) SG&A (292) (310) (449) (550) (790) (1,077) (1,296) (1,744) Other op. expenses (23) (107) (149) (189) (237) (486) (624) (884) Operating profit 1,201 1,653 1,384 2,029 3,064 3,445 4,880 6,384 Net-interest inc./(exp.) (71) (56) (6) (3) 10 9 (7) (21) Assoc/forex/extraord./others (54) 71 67 18 12 62 68 87 Pre-tax profit 1,077 1,668 1,445 2,044 3,085 3,516 4,941 6,450 Tax (283) (478) (346) (366) (807) (932) (1,281) (1,669) Min. int./pref. div./others (2) (220) (346) (454) (654) (767) (1,217) (1,673) Net profit (reported) 792 970 753 1,224 1,624 1,817 2,443 3,108 Net profit (adjusted) 792 970 753 1,224 1,624 1,817 2,443 3,108 EPS (reported) (NT$) 7.784 7.189 4.879 7.074 7.606 8.316 11.184 14.226 EPS (adjusted) (NT$) 7.784 7.189 4.879 7.074 7.606 8.316 11.184 14.226 EPS (adjusted fully-diluted) (NT$) 4.657 5.601 4.213 6.846 7.435 8.316 11.184 14.226 DPS (NT$) 1.176 1.401 2.323 1.143 1.842 2.324 2.026 2.753 EBIT 1,201 1,653 1,384 2,029 3,064 3,445 4,880 6,384 EBITDA 1,497 2,029 82,832 2,557 3,664 4,185 5,927 7,685 Cash flow (NT$m) Year to 31 Dec 2006 2007 2008 2009 2010 2011E 2012E 2013E Profit before tax 1,077 1,668 1,445 2,044 3,085 3,516 4,941 6,450 Depreciation and amortisation 307 391 81,468 546 620 768 1,075 1,329 Tax paid (283) (478) (346) (366) (807) (932) (1,281) (1,669) Change in working capital 118 (1,172) 1,281 (2,566) (269) (1,277) (1,280) (118) Other operational CF items 276 603 (80,780) 284 395 179 189 10 Cash flow from operations 1,495 1,012 3,068 (59) 3,025 2,254 3,644 6,001 Capex (1,060) (1,389) (839) (693) (1,869) (2,820) (2,400) (1,497) Net (acquisitions)/disposals 100 93 (123) (68) (229) 7 0 0 Other investing CF items (140) (122) (68) (1) 36 30 0 (21) Cash flow from investing (1,100) (1,418) (1,030) (761) (2,061) (2,783) (2,400) (1,518) Change in debt (586) 274 (4) (49) 523 1,163 624 62 Net share issues/(repurchases) 843 (1) 0 76 1,224 268 147 41 Dividends paid (150) (236) (448) (247) (492) (612) (533) (725) Other financing CF items 40 1,519 (14) (118) (123) (684) (1,217) (3,377) Cash flow from financing 147 1,555 (466) (337) 1,133 135 (980) (3,998) Forex effect/others 5 37 158 (84) (682) 0 0 0 Change in cash 547 1,186 1,730 (1,241) 1,414 (394) 264 485 Free cash flow 435 (378) 2,229 (752) 1,156 (566) 1,244 4,504 Source: Company, Daiwa forecasts -3-
  4. 4. Electronics / Taiwan 6278 TT 15 June 2011Financial summary continued … Balance sheet (NT$m)As at 31 Dec 2006 2007 2008 2009 2010 2011E 2012E 2013ECash & short-term investment 1,015 2,204 3,865 2,544 4,037 3,643 3,908 4,393Inventory 1,135 1,124 800 1,535 2,083 3,316 4,231 4,279Accounts receivable 4,154 7,300 4,191 11,656 11,788 17,409 22,215 22,467Other current assets 518 366 407 463 615 1,043 1,331 1,347Total current assets 6,822 10,993 9,262 16,197 18,523 25,412 31,686 32,486Fixed assets 2,402 3,313 3,531 3,631 5,058 7,148 8,501 8,697Goodwill & intangibles 0 0 0 0 0 0 0 0Other non-current assets 165 281 483 551 692 617 589 582Total assets 9,390 14,587 13,277 20,380 24,273 33,177 40,776 41,765Short-term debt 303 642 641 641 1,164 2,327 2,951 3,013Accounts payable 4,736 6,698 4,546 10,180 10,592 16,169 20,610 20,792Other current liabilities 397 561 594 883 1,121 1,729 2,206 2,231Total current liabilities 5,436 7,901 5,780 11,704 12,877 20,225 25,767 26,036Long-term debt 117 52 49 0 0 0 0 0Other non-current liabilities 340 613 716 747 1,037 1,120 1,120 1,120Total liabilities 5,892 8,565 6,545 12,450 13,914 21,344 26,887 27,156Share capital 1,169 1,412 1,672 1,788 2,184 2,184 2,184 2,184Reserves/R.E./others 2,329 4,609 5,059 6,142 8,175 9,648 11,705 12,425Shareholders equity 3,498 6,021 6,732 7,930 10,359 11,832 13,889 14,609Minority interests 0 0 0 0 0 0 0 0Total equity & liabilities 9,390 14,587 13,277 20,380 24,273 33,177 40,776 41,765Net debt/(cash) (595) (1,510) (3,175) (1,903) (2,873) (1,316) (957) (1,379)BVPS (NT$) 29.921 42.631 40.251 44.356 47.423 54.167 63.582 66.879 Key ratios (%)Year to 31 Dec 2006 2007 2008 2009 2010 2011E 2012E 2013ESales (YoY) 26.0 38.4 (2.7) 57.1 37.5 29.5 29.9 27.9EBITDA (YoY) 56.0 35.5 n.m. (96.9) 43.3 14.2 41.6 29.7Operating profit (YoY) 64.4 37.6 (16.3) 46.6 51.0 12.4 41.7 30.8Net profit (YoY) 68.3 22.5 (22.3) 62.5 32.7 11.9 34.5 27.2EPS (YoY) 21.0 (7.6) (32.1) 45.0 7.5 9.3 34.5 27.2Gross-profit margin 10.9 10.7 10.5 9.4 10.1 9.5 10.0 10.3EBITDA margin 10.7 10.5 n.m. 8.7 9.0 8.0 8.7 8.8Operating-profit margin 8.6 8.6 7.4 6.9 7.6 6.6 7.2 7.3ROAE 29.0 20.4 11.8 16.7 17.8 16.4 19.0 21.8ROAA 10.0 8.1 5.4 7.3 7.3 6.3 6.6 7.5ROCE 34.9 31.1 19.6 25.4 30.5 26.8 31.5 37.0ROIC 32.8 31.8 26.1 34.7 33.5 28.1 30.8 36.2Net debt to equity net cash net cash net cash net cash net cash net cash net cash net cashEffective tax rate 26.3 28.7 23.9 17.9 26.2 26.5 25.9 25.9Accounts receivable (days) 91.7 108.2 111.6 98.0 105.5 101.5 106.0 93.5Payables (days) 101.9 108.0 109.2 91.1 93.5 93.0 98.4 86.6Net interest cover (x) 17.0 29.7 248.3 669.9 n.a. n.a. 653.7 297.6Net dividend payout 18.3 18.0 32.3 23.4 26.0 30.6 24.4 24.6Source: Company, Daiwa forecasts Company profile Founded in 1990, Taiwan Surface Mounting Technology Corp (TSMT) is a surface-mount technology (SMT) supplier fitting IC chips (LED, memory, chipsets, etc.) onto printed-circuit-board (PCB) substrates. Its main products include: 1) LCD control boards, 2) LED lightbars, 3) TV-set boards, and 4) LED lighting. -4-
  5. 5. Electronics / Taiwan 6278 TT 15 June 2011 The LED-lightbar story remains intactMore than simply an We forecast LED-lightbar sales to account for 49% of TSMT’s 2011 sales. We believe there is more to theLED-lightbar story simple logic of an increasing number of LED-backlit displays implying more LED-lightbar shipments, which should result in TSMT benefitting increasingly fromWhile demand for LED lightbars the rise in the adoption of LEDs.continues to rise, we think TSMT deserves First, we expect the company to gain market share ina re-rating as the earnings from its new both LED-monitor and LED-TV applications from abusiness ventures become more low base, while it already has a 30% market share insubstantial LED-notebook applications. Second, new tablet and TV designs are likely to require more LED lightbars as the requirements for display resolution become moreSales CAGR of about 30% and stringent and overall LED costs continue to fall.profitability expected to improve TSMT: sales breakdown by product area (2010-12E)for 2011-13 Sales mix (%) 2.1% 2.7% 100% 2.0% 9.6%We forecast TSMT’s sales to rise at a CAGR of about 80% 4.6% 5.6% 8.0% 42%30% for 2011-13 and its profitability to improve over 49% 60%the same period on rising shipments and in particular, 42%an increasing sales contribution from its new 40%businesses in LED general lighting and home 20% 56% 42% 35%appliances. 0% 2010 2011E 2012E TSMT: sales and gross profit (2009-13E) Control Board Lightbar TV-set Mainboard White Home Appliance (White Goods) (NT$m) (%) LED Lighting 100,000 10.6 90,000 Source: Company, Daiwa forecasts 10.4 80,000 10.2 70,000 60,000 10.0 LED-lightbar market share in the monitor 9.8 50,000 and TV-BLU segments should double 9.6 40,000 30,000 9.4 Aside from the fact that nearly 100% of notebooks and 20,000 9.2 tablets are already LED-backlit in 2011 (this according 10,000 9.0 to DisplaySearch), TSMT is benefiting from the rising 0 8.8 demand globally for LED backlight units (BLU) from 2009 2010 2011E 2012E 2013E both monitors and TVs on the back of increasing Sales (LHS) Gross Margin (RHS) adoption of LEDs in both applications. It is gainingSource: Company, Daiwa forecasts traction in the monitor segment, in which we forecast its global market share to double to 11% for 2011 (from a low base of 5% for 2010) and the TV segment, in which we also forecast its market share to more than double to 3% (from a very low base of 1.2% for 2010). TSMT has not been affected by the reduction in the number of LED lightbars used for mainstream TV sets following last year’s product transition (from six to four initially, then from four to two, then from two to one currently), and is actually gaining market share and shipment traction. -5-
  6. 6. Electronics / Taiwan 6278 TT 15 June 2011 2010-13E LED-lightbar shipments by application (m units) The inverter-type compressor/motor is being 160 adopted increasingly in white goods. An inverter-type 140 compressor eliminates the stop-start cycles for some 120 models through electrical modulation, thus increasing 110.2 100 100.6 power efficiency, extending the life of the components, 87.0 80 and helping reduce sharp fluctuations in the load the 60 68.1 appliances place on the power supply. Eventually, this 40 28.0 makes inverter-type models not only less prone to 22.7 26.5 20 9.2 11.0 17.0 19.7 21.6 breaking down and cheaper to run than traditional 0 models, but also reduces their mechanical noise. 2010 2011E 2012E 2013E TVs Monitors Notebooks A PCBA board is a PC board that is populated withSource: Company, Daiwa forecasts electronic components (chips, passive components, etc.) through surface-mount, hole fixing and conformalNew designs require more LED lightbars coating (to prevent corrosion, current leakage, or shortNevertheless, some brand makers are using an circuit) technologies.increasing number of LED lightbars to enhance displayresolution as LED-chip costs decline further. In the Working with Philips on LED-generalfirst instance, our channel checks indicate that the lightingnumber of LED lightbars adopted in the design of a TSMT has gained Philips’ trust from past businessthird-generation tablet by a renowned US consumer- relationships in making controller boards for displayselectronic brand maker is likely to double from those and has just been qualified as one of its major EMSused in its second-generation tablet. The purpose of makers for electrical ballasts. Including Philips’ salesthis new tablet design is to increase resolution in order contribution, TSMT’s sales from lighting shouldto compete with peers making tablet-like products. increase from less than 3% for 2011 to 10-15% for 2012, and TSMT should account for 50% of Philips’ ballastSecond, based on some new-design specifications, we demand in China by 2011, according to management’sbelieve the number of LED lightbars used in TV sets guidance for its LED-general-lighting business.could triple or quadruple for those models with quasi-local-dimming features (to enhance the contrast ratio) Moreover, our sources indicate it is also working withwhen LED-chip costs drop further, which we envisage Philips on: 1) developing a cost-competitive LED lightwill occur toward the end of this year. bulb through the ODM model, and 2) manufacturing OEM products for LED general lighting fixtures.New businesses expected to LED electrical ballast and LED light bulbaccount for 24% of 2012E salesTSMT’s long-term goal is to reach balanced salescontributions from three main categories: 1) EMS forLED general lighting, starting with electric ballasts,then ODM/OEM products (light bulbs, fixtures, etc.), 2)control boards for China-brand TFT-LCD displays, and3) inverter-type PCBA for energy-saving white goods. Source: DaiwaIn addition to LED lightbars (which we expect to be Riding on the wave of urbanisation in tier-TSMT’s main revenue-growth driver this year), webelieve investors should begin to factor in the 3 and tier-4 cities in Chinacompany’s new business-growth drivers, which we In its efforts to urbanise third- and fourth-tier cities inforecast to account for 24% of the company’s 2012 sales China while promoting energy-saving home appliances,(10% from LED general lighting, 8% from TV-set the PRC Government is offering nationwide subsidies;mainboards, and 6% from white goods). thus boosting home-appliance demand. We believe TSMT is set to ride on this big wave and benefit fromWe go on to provide a brief introduction of two this strong growth trend.mentioned components for its new businesses that arestarting to contribute more substantially: -6-
  7. 7. Electronics / Taiwan 6278 TT 15 June 2011In our view, TSMT’s foray into the home-appliance China: annual air-conditioner shipments and growthspace in China is a good strategy that will benefit from Units (000) YoY (%)two government subsidy programmes (the rural 100,000 60%subsidies scheme for home-appliance purchases, and the 80,000 40%old-for-new home-appliance subsidy scheme), as well as 60,000 20%China’s 12th Five-Year Plan which promotes energy- 40,000 0%saving home appliances. 20,000 (20%) 0 (40%)TV set mainboards: We forecast this part of the 2003 2004 2005 2006 2007 2008 2009 2010business to contribute 5% of sales for 2011, from China Export shipments (k units, LHS) Domestic shipments (k units, LHS)TV brands like Hisense (Not rated), and Haier (Not Total sell-through shipments YoY (%, RHS)rated), and to account for 8% of sales for 2012. Export shipments YoY (%, RHS) Domestic shipments YoY (%, RHS) China: annual LCD-TV shipments and growth Source: IDN Units (000) YoY (%) China: annual refrigerator shipments and growth 90,000 100% 80,000 70,000 80% Units (000) YoY (%) 60,000 70,000 60% 50,000 60% 40,000 60,000 50% 40% 50,000 30,000 40% 20,000 20% 40,000 10,000 30% 30,000 0 0% 20% 20,000 2007 2008 2009 2010 10,000 10% Export shipments (k units, LHS) 0 0% Domestic shipments (k units, LHS) Total sell-through shipments YoY (%, RHS) 2007 2008 2009 2010 Export shipments YoY (%, RHS) Export shipments (k units, LHS) Domestic shipments YoY (%, RHS) Domestic shipments (k units, LHS) Total sell-through shipments YoY (%, RHS)Source: IDN Export shipments YoY (%, RHS) Domestic shipments YoY (%, RHS)Printed-circuit-board assembly (PCBA) for Source: IDNwhite goods: We forecast the sales contribution fromthis segment to increase from 2% of sales for 2011 to We believe the shipment momentum will continue to6% of sales for 2012, attributed mostly by China home- rise, boosted by: 1) the two subsidy programmes andappliance makers Gree Electric Appliances (Not rated), the promoting of energy-saving home applianceGD Midea Holding (Not rated) and Hisense. purchases, and 2) urbanisation of tier-3 and tier-4 cities in China.Triggered by the government’s subsidy schemes andthe 12th Five-Year Plan promoting energy-saving home By entering the China home-appliances market, weappliances, overall demand for white goods recorded believe TSMT’s overall sales and earnings performancesignificant growth in 2010 (more than 25% YoY will benefit from the increase in demand in the nextdemand growth for washing machines, more than 35% few years.YoY for air conditioners and more than 30% YoY forrefrigerators, according to IDN). Conviction Buy with 31% upsideChina: annual washing-machine shipments and growth potential Units (000) YoY (%) 60,000 40% We maintain our Buy [1] rating and have raised our six- 50,000 30% 40,000 month target price to NT$117.0 (implying 31% upside 20% potential), based on a new target PER of 12x (from 10x 30,000 10% 20,000 previously) and average 2011 and 2012 EPS forecasts of 10,000 0% NT$8.32 and NT$11.18, respectively. The 12x PER is at 0 (10%) about a 15% discount to the current PER of the LED 2006 2007 2008 2009 2010 companies and home-appliance makers, as it is not a pure Export shipment (k units, LHS) Domestic shipment (k units, LHS) play in both sectors. Total sell-through shipment YoY (%, RHS) Export shipment YoY (%, RHS) Domestic shipment YoY (%, RHS)Source: IDN -7-
  8. 8. Electronics / Taiwan 6278 TT 15 June 2011We believe the counter deserves a 12x target PER as its In our opinion, the major downside risk would benew businesses start to contribute thanks to the two slower-than-expected ramp-up of the new businesssubsidy programmes and the focus of the 12th Five- ventures.Year Plan on promoting energy-saving homeappliances. TSMT: comparison of main product lines LCD control boards LED lightbars White home appliances (whiteItem (panel drivers) (back light drivers) TV set mainboards goods) LED lightingYear of launch Since 2000 Since 2007 Since July 2010 Since April 2011 Since 20102011/2012 sales mix (%) 42/35 49/42 5/8 2/6 3/10Current monthly output 13-14m pcs >10m pcs 1m pcs 300-400k naASP US$4-6 US$6-11 > US$9 US$12-13.5 naGross-profit margin 9-11% 8-9% 5-6% 10-15% > 10% Global brand-name accounts - Haier - Gree Electric Appliances, - AUO that go through backlight unit - HisenseMajor clients - CMI - GD Midea Holding - White brand distribution makers like Radiant, Coretronic, - Briview (for Toshiba and - Samsung - Haier and Nano Optoelectronics Panasonic) - Philips - SharpProspects - Toshiba - Sharp - Hisense - OSRAM - Wistron - GE - Lite-On Tech (2301 TT, - Universal Scientific Industrial - GIO Optoelectronics (Not NT$36.55, Underperform [4[) (merged with ASE [Not rated]) - FIH (Not rated) listed) - Delta (2308 TT, NT$106,SellMajor competitors - WUS (Not rated) - Panel makers - Huntkey (Not listed) - Wellypower (Not rated) [5]) - FDK-Fuchi (Not listed) - Brand makers - Lextar (Not listed) - Bright LED (Not rated) - Qisda (Not rated) - Unity Opto (Not rated)Source: Company, compiled by Daiwa TSMT: quarterly and yearly financial summary 2011E 2012E(NT$m, year-end Dec) 1Q 2QE 3QE 4QE 1QE 2QE 3QE 4QE 2011E 2012ERevenue 10,388 12,578 14,418 15,129 14,797 15,998 18,095 19,306 52,514 68,196Depreciation & amortisation (169) (176) (200) (223) (243) (260) (277) (294) (768) (1,075)COGS (9,436) (11,424) (13,010) (13,636) (13,334) (14,422) (16,250) (17,391) (47,506) (61,396)Gross profit 953 1,155 1,407 1,493 1,463 1,576 1,845 1,915 5,008 6,800Operating expense (271) (401) (450) (442) (418) (449) (510) (542) (1,563) (1,920)EBIT 682 754 958 1,051 1,045 1,127 1,335 1,373 3,445 4,880Net interest income 5 3 1 (0) (1) (1) (2) (3) 9 (7)Net other income 20 13 14 15 15 16 18 19 62 68Pre tax profit 707 769 973 1,066 1,058 1,142 1,352 1,389 3,516 4,941Tax (196) (226) (243) (267) (265) (331) (338) (347) (932) (1,281)Net profit 347 391 518 560 556 551 659 677 1,817 2,443EPS (NT$) 1.59 1.79 2.37 2.56 2.54 2.52 3.02 3.10 8.32 11.18Key driversControl-board shipments (m) 45.4 51.5 58.2 58.8 56.6 60.4 64.1 64.5 213.8 245.7Lightbar shipments (m) 25.6 32.3 34.2 34.5 34.2 36.9 38.0 37.7 126.7 146.8Margins (%)Gross-profit margin 9.2 9.2 9.8 9.9 9.9 9.9 10.2 9.9 9.5 10.0Operating-profit margin 6.6 6.0 6.6 6.9 7.1 7.0 7.4 7.1 6.6 7.2EBITDA margin 8.2 7.4 8.0 8.4 8.7 8.7 8.9 8.6 8.0 8.7Net-profit margin 3.3 3.1 3.6 3.7 3.8 3.4 3.6 3.5 3.5 3.6Sequential growth (%)Revenue (0.7) 21.1 14.6 4.9 (2.2) 8.1 13.1 6.7 29.5 29.9Gross profit (4.3) 21.2 21.8 6.1 (2.0) 7.7 17.1 3.8 22.4 35.8EBIT (2.8) 10.5 27.0 9.8 (0.6) 7.9 18.5 2.8 12.4 41.7Net profit 5.9 12.6 32.5 8.0 (0.7) (0.7) 19.5 2.7 11.9 34.5EPS 5.9 12.6 32.5 8.0 (0.7) (0.7) 19.5 2.7 9.3 34.5Source: Company, Daiwa forecastsNote: net profit is after minority interests -8-
  9. 9. Electronics / Taiwan 6278 TT 15 June 2011 TSMT: forward PER bands TSMT: trailing PER bands (NT$) (NT$) 100 10x 100 90 90 11x 80 8x 80 70 70 9x 60 6x 60 7x 50 50 40 4x 40 5x 30 30 20 20 10 10 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11Source: TEJ, Daiwa forecasts Source: TEJ, Daiwa forecasts Peer comparisons Last price EPS (loc curr) PER (x) ROE (%) Market capCompany Ticker Rating (loc curr) 2010 2011E 2012E 2011E 2012E 2011E 2012E (US$m)BacklightRadiant Opto-Electronics Corp 6176 TT 1 108.00 6.11 10.18 11.57 10.6 9.3 26.9 26.8 1,596Coretronic Corp 5371 TT 3 48.50 4.88 5.01 5.52 9.7 8.8 16.7 17.0 1,218TSMT 6278 TT 1 89.20 7.61 8.32 11.18 10.7 8.0 16.4 19.0 676 Wtd. Avg. 10.3 8.9LEDEPISTAR CORP 2448 TT 5 92.40 7.16 4.98 6.26 18.5 14.8 9.5 11.8 2,740FORMOSA EPITAXY INC 3061 TT NR 31.45 2.94 2.37 2.78 13.3 11.3 10.4 12.7 524OPTO TECH CORP 2340 TT NR 19.40 1.26 n.a. n.a. n.a. n.a. n.a. n.a. 369EVERLIGHT ELEC 2393 TT 3 78.00 5.52 6.29 6.47 12.4 12.0 13.1 10.6 1,134HARVATEK CORP 6168 TT NR 31.30 1.14 2.46 n.a. 12.7 n.a. n.a. n.a. 216BRIGHT LED ELECTRONICS CORP 3031 TT NR 28.10 1.65 2.83 n.a. 9.9 n.a. 15.3 n.a. 192YOUNGTEK ELECTRONICS CORP 6261 TT NR 107.50 8.53 10.07 11.13 10.7 9.7 n.a. n.a. 365 Wtd. Avg. 15.5 13.3Household Electronic AppliancesHaier Electronics Group 1169 HK NR 8.85 0.56 0.66 0.86 13.4 10.3 43.5 37.4 2,630Gree Electric Appliances 000651 CH NR 21.84 1.52 1.83 2.20 11.9 9.9 29.0 26.9 9,498GD Midea Holding 000527 CH NR 17.70 1.00 1.24 1.54 14.3 11.5 23.8 22.7 9,245Suning Appliance 002024 CH NR 12.11 0.57 0.76 0.94 16.0 13.0 23.3 23.6 13,075Konka Group 200016 CH NR 2.39 0.07 n.a. n.a. n.a. n.a. n.a. n.a. 679Hisense Kelon Electric 921 HK NR 3.04 0.47 0.36 0.41 8.6 7.5 n.a. n.a. 1,104Skyworth Digital Holdings 751 HK NR 4.63 0.52 0.56 0.52 8.3 8.9 16.0 16.0 1,545Gome Electrical Appliances 493 HK 1 2.98 0.15 0.18 0.22 16.1 13.3 15.1 16.8 6,447 Wtd. avg. 14.1 11.6Source: Bloomberg-consensus forecast, Daiwa forecasts for shaded stocksNote: 1 = Buy, 2 = Outperform, 3 = Hold, 4 = Underperform, 5 = Sell -9-
  10. 10. Daiwa’s Asia Pacific Research DirectoryHong KongRegional Research Head; Pan Asia Research Nagahisa MIYABE (852) 2848 4971 nagahisa.miyabe@hk.daiwacm.comRegional Research Co-head Christopher LOBELLO (852) 2848 4916 christopher.lobello@hk.daiwacm.comHead of Product Management John HETHERINGTON (852) 2773 8787 john.hetherington@hk.daiwacm.comProduct Management Tathagata Guha ROY (852) 2773 8731 tathagata.guharoy@hk.daiwacm.comHead of China Research; Chief Economist (Greater China) Mingchun SUN (852) 2773 8751 mingchun.sun@hk.daiwacm.comMacro Economy (Hong Kong, China) Kevin LAI (852) 2848 4926 kevin.lai@hk.daiwacm.comRegional Chief Strategist; Strategy (Regional) Colin BRADBURY (852) 2848 4983 colin.bradbury@hk.daiwacm.comStrategy (Regional) Mun Hon THAM (852) 2848 4426 munhon.tham@hk.daiwacm.comHead of Hong Kong Research; Regional Property Coordinator; Jonas KAN (852) 2848 4439 jonas.kan@hk.daiwacm.comCo-head of Hong Kong and China Property; Property Developers (Hong Kong)Automobiles and Components (China) Jeff CHUNG (852) 2773 8783 jeff.chung@hk.daiwacm.comHead of Greater China FIG; Banking (Hong Kong, China) Grace WU (852) 2532 4383 grace.wu@hk.daiwacm.comBanking (Hong Kong, China) Queenie POON (852) 2532 4381 queenie.poon@hk.daiwacm.comInsurance Jennifer LAW (852) 2773 8745 jennifer.law@hk.daiwacm.comCapital Goods –Electronics Equipments and Machinery; IT/Electronics – Tech Hardware Joseph HO (852) 2848 4443 joseph.ho@hk.daiwacm.com(Hong Kong, China)Consumer/Retail (Hong Kong, China) Peter CHU (852) 2848 4430 peter.chu@hk.daiwacm.comConsumer/Retail (China) Nicolas WANG (852) 2848 4963 nicolas.wang@hk.daiwacm.comHead of HK and China Gaming and Leisure; Hotels, Restaurants and Leisure – Casinos Gavin HO (852) 2532 4384 gavin.ho@hk.daiwacm.comand Gaming (Hong Kong); Capital Goods – Conglomerate (Hong Kong)Regional Head of IT/Electronics; IT/Electronics – Semiconductor and Solar Pranab Kumar SARMAH (852) 2848 4441 pranab.sarmah@hk.daiwacm.com(Regional, Taiwan, Singapore, Hong Kong and China)Co-head of Regional IT/Electronics; IT/Electronics – Semiconductor/IC Design (Regional) Eric CHEN (852) 2773 8702 eric.chen@hk.daiwacm.comIT/Technology Hardware – PC Hardware (Taiwan) Calvin HUANG (852) 2773 8782 calvin.huang@hk.daiwacm.comIT/Electronics - Semiconductor/IC Design (Taiwan) Ashley CHUNG (852) 2848 4431 ashley.chung@hk.daiwacm.comRegional Head of Materials; Materials/Energy (Regional) Alexander LATZER (852) 2848 4463 alexander.latzer@hk.daiwacm.comMaterials (China) Felix LAM (852) 2532 4341 felix.lam@hk.daiwacm.comPan Asia Research, Consumer, Pharmaceuticals and Healthcare (China) Hongxia ZHU (852) 2848 4460 hongxia.zhu@hk.daiwacm.comPan Asia Research Kenji SERIZAWA (852) 2532 4159 kenji.serizawa@hk.daiwacm.comHead of Hong Kong and China Property; Property Developers (Hong Kong, China) Danny BAO (852) 2773 8715 danny.bao@hk.daiwacm.comProperty (Hong Kong, China) Yannis KUO (852) 2773 8735 yannis.kuo@hk.daiwacm.comRegional Head of Small/Medium Cap; Small/Medium Cap (Regional) Mark CHANG (852) 2773 8729 mark.chang@hk.daiwacm.comSmall/Medium Cap (Regional) John CHOI (852) 2773 8730 john.choi@hk.daiwacm.comRegional Head of Telecommunications; Telecommunications (Regional, Greater China); Marvin LO (852) 2848 4465 marvin.lo@hk.daiwacm.comInternet (China)Transportation – Aviation, Land and Transportation Infrastructure (Regional) Kelvin LAU (852) 2848 4467 kelvin.lau@hk.daiwacm.comTransportation –Transportation Infrastructure; Capital Goods – Construction and Edwin LEE (852) 2532 4349 edwin.lee@hk.daiwacm.comEngineering (China)Regional Head of Clean Energy and Utilities; Utilities; Power Equipment; Dave DAI (852) 2848 4068 dave.dai@hk.daiwacm.comRenewables (Hong Kong, China)Head of Custom Products Group; Custom Products Group Justin LAU (852) 2773 8741 justin.lau@hk.daiwacm.comCustom Products Group Philip LO (852) 2773 8714 philip.lo@hk.daiwacm.comCustom Products Group Jibo MA (852) 2848 4489 jibo.ma@hk.daiwacm.comSouth KoreaHead of Research; Strategy; Banking/Finance Chang H LEE (82) 2 787 9177 chlee@kr.daiwacm.comRegional Head of Automobiles and Components; Automobiles; Shipbuilding; Steel Sung Yop CHUNG (82) 2 787 9157 sychung@kr.daiwacm.comBanking/Finance Anderson CHA (82) 2 787 9185 anderson.cha@kr.daiwacm.comCapital Goods (Construction and Machinery) Mike OH (82) 2 787 9179 mike.oh@kr.daiwacm.comConsumer/Retail Sang Hee PARK (82) 2 787 9165 sanghee.park@kr.daiwacm.comIT/Electronics (Tech Hardware and Memory Chips) Jae H LEE (82) 2 787 9173 jhlee@kr.daiwacm.comIT Electronics (Tech Hardware) Steve OH (82) 2 787 9195 steve.oh@kr.daiwacm.comMaterials (Chemicals); Oil and Gas Daniel LEE (82) 2 787 9121 daniel.lee@kr.daiwacm.comPan Asia Research; Small/Medium Caps Yumi KIM (82) 2 787 9838 yumi.kim@kr.daiwacm.comTelecommunications; Software (Internet/Online Games) Thomas Y KWON (82) 2 787 9181 yskwon@kr.daiwacm.comCustom Products Group Shannen PARK (82) 2 787 9184 shannen.park@kr.daiwacm.com - 10 -
  11. 11. TaiwanHead of Taiwan Research; Pan Asia Research Hirokazu Mitsuda (886) 2 2758 8754 h.mitsuda@daiwacm-cathay.com.twCo-head of Research; Strategy Alex YANG (886) 2 2345 3660 alex.yang@daiwacm-cathay.com.twConsumer/Retail Yoshihiko KAWASHIMA (886) 2 8780 5987 y.kawashima@daiwacm-cathay.com.twIT/Technology Hardware (Communications Equipment); Software; Small/Medium Caps Christine WANG (886) 2 8788 1531 christine.wang@daiwacm-cathay.com.twIT/Technology Hardware (Handsets and Components) Alex CHANG (886) 2 8788 1584 alex.chang@daiwacm-cathay.com.twIT/Technology Hardware (PC Hardware - Panels) Chris LIN (886) 2 8788 1614 chris.lin@daiwacm-cathay.com.twIT/Technology Hardware (PC Components) Jenny SHIH (886) 2 8780 1326 jenny.shih@daiwacm-cathay.com.twMaterials; Conglomerates Albert HSU (886) 2 8786 2212 albert.hsu@daiwacm-cathay.com.twIndiaHead of India Equities Strategy Jaideep GOSWAMI (91) 22 6622 1010 jaideep.goswami@in.daiwacm.comDeputy Head of Research; Strategy; Banking/Finance Punit SRIVASTAVA (91) 22 6622 1013 punit.srivastava@in.daiwacm.comAll Industries; Pan Asia Research Fumio YOKOMICHI (91) 22 6622 1003 fumio.yokomichi@in.daiwacm.comAutomobiles Ambrish MISHRA (91) 22 6622 1060 ambrish.mishra@in.daiwacm.comCapital Goods; Utilities Jonas BHUTTA (91) 22 6622 1008 jonas.bhutta@in.daiwacm.comMaterials Vishal CHANDAK (91) 22 6622 1006 vishal.chandak@in.daiwacm.comOil & Gas; Construction; Small/Medium Caps Atul RASTOGI (91) 22 6622 1020 atul.rastogi@in.daiwacm.comPharmaceuticals and Healthcare; Consumer Kartik A. MEHTA (91) 22 6622 1012 kartik.mehta@in.daiwacm.comReal Estate Amit AGARWAL (91) 22 6622 1063 amit.agarwal@in.daiwacm.comSingaporeHead of Research; Pan Asia Research Tatsuya TORIKOSHI (65) 6321 3050 tatsuya.torikoshi@sg.daiwacm.comChief Economist, Asia Ex-JP; Macro Economy (Regional) Prasenjit K BASU (65) 6321 3069 p-k.basu@sg.daiwacm.comGlobal Director of Quantitative Research; Quantitative Research Deep KAPUR (65) 6321 3079 deep.kapur@sg.daiwacm.comQuantitative Research Josh CHERIAN (65) 6499 6549 josh.cherian@sg.daiwacm.comQuantitative Research Suzanne HO (65) 6499 6545 suzanne.ho@sg.daiwacm.comRegional Head of Banking/Finance; Banking; Property and REITs David LUM (65) 6329 2102 david.lum@sg.daiwacm.comBanking (ASEAN) Srikanth VADLAMANI (65) 6499 6570 srikanth.vadlamani@sg.daiwacm.comConsumer; Food and Beverage; Small/Medium Cap (ASEAN) Pyari MENON (65) 6499 6566 pyari.menon@sg.daiwacm.comRegional Head of Oil and Gas; Oil and Gas (ASEAN and China); Capital Goods (Singapore) Adrian LOH (65) 6499 6548 adrian.loh@sg.daiwacm.comHead of ASEAN & India Telecommunications; Telecommunications (ASEAN & India) Ramakrishna MARUVADA (65) 6499 6543 ramakrishna.maruvada@sg.daiwacm.comAustraliaResources/Mining/Petroleum David BRENNAN (61) 3 9916 1323 david.brennan@au.daiwacm.comJapanIndustrials (Regional); Pan Asia Research Taiki KAJI (81) 3 5555 7174 taiki.kaji@jp.daiwacm.comIndustrials (Regional); Pan Asia Research Daijiro HATA (81) 3 5555 7178 daijiro.hata@jp.daiwacm.com - 11 -
  12. 12. Daiwa’s OfficeOffice / Branch / Affiliate Address Tel FaxDAIWA SECURITIES GROUP INCHEAD OFFICE Gran Tokyo North Tower, 1-9-1, Marunouchi, Chiyoda-ku, Tokyo, 100-6753 (81) 3 5555 3111 (81) 3 5555 0661Daiwa Securities Trust Company One Evertrust Plaza, Jersey City, NJ 07302, U.S.A. (1) 201 333 7300 (1) 201 333 7726Daiwa Securities Trust and Banking (Europe) PLC (Head Office) 5 King William Street, London EC4N 7JB, United Kingdom (44) 207 320 8000 (44) 207 410 0129Daiwa Securities Trust and Banking (Europe) PLC (Dublin Branch) Level 3, Block 5, Harcourt Centre, Harcourt Road, Dublin 2, Ireland (353) 1 603 9900 (353) 1 478 3469DAIWA CAPITAL MARKETS LIMITEDHEAD OFFICE Gran Tokyo North Tower, 1-9-1, Marunouchi, Chiyoda-ku, (03) 5555 3111 (03) 5555 0661 Tokyo, 100-6753Daiwa Capital Markets America Inc Financial Square, 32 Old Slip, New York, NY10005, U.S.A. (1) 212 612 7000 (1) 212 612 7100Daiwa Capital Markets America Inc. San Francisco Branch 555 California Street, Suite 3360, San Francisco, CA 94104, U.S.A. (1) 415 955 8100 (1) 415 956 1935Daiwa Capital Markets Europe Limited 5 King William Street, London EC4N 7AX, United Kingdom (44) 20 7597 8000 (44) 20 7597 8600Daiwa Capital Markets Europe Limited, Frankfurt Branch Trianon Building, Mainzer Landstrasse 16, 60325 Frankfurt am Main, (49) 69 717 080 (49) 69 723 340 Federal Republic of GermanyDaiwa Capital Markets Europe Limited, Paris Branch 127, Avenue des Champs-Elysées, 75008 Paris, France (33) 1 56 262 200 (33) 1 47 550 808Daiwa Capital Markets Europe Limited, Geneva Branch 50 rue du Rhône, P.O.Box 3198, 1211 Geneva 3, Switzerland (41) 22 818 7400 (41) 22 818 7441Daiwa Capital Markets Europe Limited, Milan Branch Via Senato 14/16, 20121 Milan, Italy (39) 02 763 271 (39) 02 763 27250Daiwa Capital Markets Europe Limited, 25/9, build. 1, Per. Sivtsev Vrazhek, Moscow 119002, Russian Federation (7) 495 617 1960 (7) 495 244 1977Moscow Representative OfficeDaiwa Capital Markets Europe Limited, Bahrain Branch 7th Floor, The Tower, Bahrain Commercial Complex, P.O. Box 30069, (973) 17 534 452 (973) 17 535 113 Manama, BahrainDaiwa Capital Markets Europe Limited, Dubai Branch The Gate village Building 1, 1st floor, Unit-6, DIFC, P.O.Box-506657, (971) 47 090 401 (971) 43 230 332 Dubai, UAE.Daiwa Capital Markets Hong Kong Limited Level 26, One Pacific Place, 88 Queensway, Hong Kong (852) 2525 0121 (852) 2845 1621Daiwa Capital Markets Singapore Limited 6 Shenton Way #26-08, DBS Building Tower Two, Singapore 068809, (65) 6220 3666 (65) 6223 6198 Republic of SingaporeDaiwa Capital Markets Australia Limited Level 34, Rialto North Tower, 525 Collins Street, Melbourne, (61) 3 9916 1300 (61) 3 9916 1330 Victoria 3000, AustraliaDBP-Daiwa Capital Markets Philippines, Inc 18th Floor, Citibank Tower, 8741 Paseo de Roxas, Salcedo Village, (632) 813 7344 (632) 848 0105 Makati City, Republic of the PhilippinesDaiwa-Cathay Capital Markets Co Ltd 14/F, 200, Keelung Road, Sec 1, Taipei, Taiwan, R.O.C. (886) 2 2723 9698 (886) 2 2345 3638Daiwa Securities Capital Markets Co Ltd, Seoul Branch 6th Floor, Hana Daetoo Securities Bldg 27-3, Yeouido-Dong, (82) 2 787 9100 (82) 2 787 9191 Yeongdeungpo-Gu, Seoul, Republic of KoreaDaiwa Securities Capital Markets Co Ltd, Room 3503/3504, SK Tower, (86) 10 6500 6688 (86) 10 6500 3594Beijing Representative Office No.6 Jia Jianguomen Wai Avenue, Chaoyang District, Beijing 100022, People’s Republic of ChinaDaiwa SSC Securities Co Ltd Room 011, 45F HSBC Tower, 1000 Lujiazui Ring Road, (86) 21 6859 8000 (86) 21 6859 8030 Pudong New Area, Shanghai 200120, People’s Republic of ChinaDaiwa Securities Capital Markets Co. Ltd, Level 8 Zuellig House, 1 Sliom Road, (66) 2 231 8381 (66) 2 231 8121Bangkok Representative Office Bangkok 10500, ThailandDaiwa Capital Markets India Private Ltd 10th Floor, 3 North Avenue, Maker Maxity, Bandra Kurla Complex, (91) 22 6622 1000 (91) 22 6622 1019 Bandra East, Mumbai – 400051, IndiaDaiwa Securities Capital Markets Co. Ltd, Suite 405, Pacific Palace Building, 83B, Ly Thuong Kiet Street, (84) 4 3946 0460 (84) 4 3946 0461Hanoi Representative Office Hoan Kiem Dist. Hanoi, VietnamDAIWA INSTITUTE OF RESEARCH LTDHEAD OFFICE 15-6, Fuyuki, Koto-ku, Tokyo, 135-8460, Japan (81) 3 5620 5100 (81) 3 5620 5603MARUNOUCHI OFFICE Gran Tokyo North Tower, 1-9-1, Marunouchi, Chiyoda-ku, Tokyo, 100-6756 (81) 3 5555 7011 (81) 3 5202 2021New York Research Center 11th Floor, Financial Square, 32 Old Slip, NY, NY 10005-3504, U.S.A. (1) 212 612 6100 (1) 212 612 8417London Research Centre 3/F, 5 King William Street, London, EC4N 7AX, United Kingdom (44) 207 597 8000 (44) 207 597 8550 - 12 -
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