Singapore Budget 2015

Transcription

ECONOMICS RESEARCH | Singapore
February 24, 2015
A “Structural & Social” Budget

Budget 2015 is all about addressing structural-economic and
socio-economic issues

Hence measures to enhance skills, boost productivity
alleviate cost pressures and strengthen social security.

Budget deficit of SGD6.7b or -1.7% of GDP in FY2015
(FY2014: SGD0.13b or -0.03% of GDP)
Tackling structural-economic and socio-economic issues. The
Budget’s theme of “Building Our Future, Strengthening Social
Security” zeroes on two key issues. First, the issues of business
costs and productivity as the policy-driven labour market tightness
in recent years raised unit labour cost (2012-2014: +3.0% p.a.) as
productivity declined (2012-2014: -0.3% p.a. vs the official target
of 2%-3% p.a. set in 2010). Second, the adequacy of social security
and welfare schemes in dealing with the rising living costs.
Economists
Suhaimi B Ilias
(603) 2297 8682
[email protected]
Dr Zamros Dzulkafli
(603) 2082 6818
[email protected]
Ramesh Lankanathan
(603) 2297 8685
[email protected]
William Poh Chee Keong
(603) 2297 8683
[email protected]
Measures therefore aimed at enhancing skills, boost
productivity and alleviate labour and business cost pressures.
These include SkillsFuture schemes and programmes; extension of
Wage Credit Scheme and Corporate Income Tax rebates until 2017;
deferring the hikes in foreign workers’ levies.
And strengthening social security system and financial supports
to ensure retirement adequacy and help the seniors and
households manage their living costs. These encompasses increase
in the CPF’s ceiling rate, contribution rates and extra interests to
benefit middle-income Singaporeans, older workers and those with
lower balances; Silver Support Scheme to supplement the incomes
for the bottom 20%-30% of the senior citizens; additional financial
supports to families with children and lower income households to
manage the costs of childcare, education and general living.
Plus a more progressive personal income tax structure and
broadening income sources from Net Investment Returns (NIR)
to strengthen revenue base, cap the budget deficit and pay for the
rise in development spending which is expected to increase by 50%
in the next five years, mainly on transport infrastructure and
healthcare. Top personal income tax rate is raised to 22% from
20% and the top 5% of income earners in general will pay more tax,
while a personal income tax rebate of 50% and capped at SGD1,000
to benefit mainly the middle income taxpayers. Revenues is also
strengthened by including Temasek in the Net Investment Return
(NIR) to add to the contributions form MAS and GIC.
Larger budget deficit as “expansionary” fiscal policy
complement recent monetary policy easing. Budget 2015 is
expected to register a larger deficit of -SGD6.7b or -1.7% of GDP
(2014: -SGD0.13b or -0.03% of GDP).
SEE PAGE 9 FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS
PP16832/01/2013 (031128)
Enhance skills, facilitate restructuring, boost productivity,
alleviate labour and business costs pressures
The key measures in Budget 2015 to deal with the issues of falling
productivity and rising labour costs are mainly via initiatives to enhance
skills, facilitate business restructuring, boost productivity and alleviate the
labour and business cost pressures. These include:

Further extension to the Transition Support Package (TSP). TSP
consists of Productivity & Innovation Credit (PIC) Scheme, Wage Credit
Scheme (WCS) and Corporate Income Tax (CIT) Rebate. PIC Scheme to
incentivize investment in productivity and innovation was extended
and enhanced in Budget 2014 by another three years until 2018. Under
Budget 2015, the extension is accorded to WCS and CIT Rebate.
Wage Credit Scheme (WCS) expiring this year extended to 20162017 but at half the current rate i.e. Government will co-fund 20% of
the wage increases given next two years to Singaporean employees
earning gross monthly wage of up to SGD4,000, down from 40%
currently. The move is to give employers time to adjust to the tight
labour market as they continue to restructure, especially by allowing
businesses – especially SMEs – to reduce the wage cost and have the
internal financial resources to invest in productivity enhancements.
The Government will incur SGD1.8b in expenses from this.
Corporate Income Tax (CIT) Rebate, also expiring this year, is
extended until 2017, allowing all companies to enjoy a 30% rebate of
the tax payable for the assessment years 2016-2017, although the cap
for the rebate is lowered to SGD20,000 from SGD30,000, mainly to
ensure the main beneficiary is the SMEs. The extension will cost the
Government SGD800m.

Introduce SkillsFuture schemes and programmes worth SGD1b
between 2015 and 2020 to support career development beginning at
school, promote life-long learning and continually renew deep skills
and advanced capabilities that are crucial for the next stage of
Singapore’s economic growth and development. Every Singaporean
aged 25 and above will receive an initial SGD500 of SkillsFuture Credit
that will be topped out and will not expire which can be used on a
range of Government-supported courses. In addition, there will be
Earn and Learn programme for fresh Polytechnics and Institutes of
Technical Education (ITEs) graduates to do on-the-job training as well
as structured internships programmes for two-thirds of Polytechnic and
ITE courses via collaboration with industries. Singaporeans who want
to build specific skills in growing industries can apply for the
SkillsFuture Study Award to be introduced this year in phases where
about 2,000 such awards will be given out annually, and about 100
SkillsFuture Fellowships a year will be awarded from 2016 to those who
want to further develop higher-level skills.
There is also the
Leadership Development Initiative to support companies that commit
to developing pipeline of future corporate leaders. For mid-career
Singaporeans aged 40 and above, a minimum of 90% of training costs
for Government approved courses will be subsidised.
February 24, 2015
2

Defer planned increase in foreign workers levies for S pass and work
permit for every sector to enable businesses – especially the SMEs –
more time and room to adjust to the prolonged tight labour market
amid difficulties in hiring Singaporean workers given the demographic
trend, which is compounded by the slowing influx of foreign workers.
The levies on foreign work permits holders in the manufacturing sector
will be maintain at current levels for this year and next year. However,
underscoring the point that this is not an abrupt policy U-turn, and to
encourage the hiring of higher skilled workers in the construction
sector, the levy for higher-skilled R1 workers will be lowered from
SGD750 to SGD600 effective 1 July while the levy for basic-skilled R2
work permit workers will be raised from SGD550 to SGD650 in 2016 and
to SGD700 in 2017. Going forward, the policy on the foreign workers’
levies will be reviewed based on the pace of inflows, the quality of
workers employed and the progress in raising productivity.
Further strengthening of the social security system
Another central plank of Budget 2015 is the further strengthening of
the social security system. Adding to the improvements in the social
security system in recent years through home ownership, CPF, healthcare
assurance and Workfare, Budget 2015 announced measures to address
socio-economic issues of retirement adequacy as well as enhancing the
supports for the seniors, families with children and the lower and middleincome groups to alleviate the rising cost of living. These include:

Changes in CPF to benefit middle-income Singaporeans, older
workers and those with lower balances. These include the increases
in CPF salary ceiling (to SGD6,000 from SGD5,000) and contribution
rates for older workers (+2 percentage points for 50-55 years old split
equally between employers and employees; +1 percentage point for
55-60 years old and +0.5 percentage point for 60-65 years old to be
fully borne by employers) effective 1 Jan 2016; plus enhancement to
the CPF interest rates to benefit those with lower balances (additional
1% extra interest to 6% on the first SGD30,000 of CPF balances from
the age of 55 years old). These are in line with and in addition to the
recently proposed changes by the CPF Advisory Panel to provide more
flexibility and certainty to CPF members that was accepted by the
Government.
To partly offset the cost impact of these changes to employers, the
Temporary Employment Credit (TEC) will be enhanced by increasing
it to 1% of wages this year from 0.5% of wages last year, and the TEC
will be extended for two years with the rate of 1% of wages in 2016
and 0.5% of wages in 2017.

Introduce Silver Support Scheme to supplement the incomes for the
bottom 20% to 30% of seniors aged 65 years and above in their
retirement years. Silver Support will provide an income supplement of
between SGD300 to 750 every quarter for eligible seniors for life, as
long as they remain eligible. The scheme is expected to start in 1Q
2016.
February 24, 2015
3

Increasing and expanding supports to families with children,
including further subsidies to reduce cost of pre-school childcare; top
up of between SGD300 to SGD600 to the Child Development Account
(CDA) for children aged 6 years and below; waive the exam fees on
national examinations in Government-funded schools and the exam
fees on Singaporeans enrolled full-time at Polytechnics and ITEs;
SGD150 top up to the existing annual contribution of SGD240 for the
Edusave accounts of Singaporean students aged between 7 and 16
years; SGD250-USD500 top up to the Post-Secondary Education Account
(PSEA) of Singaporeans aged 17 to 20 years to assist households in
saving for tertiary education; enhance MOE’s Financial Assistance
Scheme (FAS) that currently cover school fees, standard miscellaneous
fees, textbooks and uniforms to include transport subsidy to cover at
least half of the transport costs inclusive of school buses and public
transport; and reduce the foreign domestic worker concessionary levy
from SGD120 per month to SGD60 per month and extending the
concessionary levy to households with children aged below 16 years, up
from below 12 years.

Additional supports for lower income household to manage their
cost of living via enhancement to the GST Voucher (GSTV) Scheme by
increasing the GSTV-Cash by SGD50 across the board from 2015
onwards and raise the amount for GST-Seniors’ Bonus given to those
aged 55 and above. The Government will also give 1 to 3 months of
Service & Conservancy Charges (S&CC) rebates.
Other key measures and announcements
Making the personal income tax structure more progressive by raising
the top tax rate to 22% from 20% which will affect those with chargeable
income of SGD320,000 and above, the while others in the top 5% of income
earners (earn at least SGD160,000) will see a bigger tax bill with effective
tax rate increasing between 0.2 percentage point to 1.6 percentage points,
starting with income earned in 2016. At the same time, Budget 2015 also
contains a personal income tax rebate of 50% and capped at SGD1,000 so
as to benefit mainly the middle and upper-middle income taxpayers. This
measure is equivalent to SGD717m in foregone revenues.
50% rise in development spending next five years, especially on
economic and social infrastructure, namely transport and healthcare.
Development spending which rose from SGD12b five years ago is projected
to reach SGD20b (4.8% of GDP) this year and SGD30b (6.0% of GDP) by
2020. The Government will spend SGD26b on public transportation over the
next five years versus SGD14b in the last five years to make Singapore a
highly livable city. It will also inject SGD3b into the Changi Airport
Development Fund (CADF) to develop the new Terminal 5 with top ups in
the future. Healthcare spending will reach SGD13b by 2020 from SGD9b
estimated for 2015, among others to increase the number of hospital beds
by 25%, double the community hospital beds, raise nursing home capacity
by about 70% and investing to bring affordable care into the community so
that our seniors can be cared for at home.
February 24, 2015
4
Strengthening future revenues by including Temasek in Net Investment
Return (NIR). The Government currently taps on the expected long-term
returns from MAS and GIC, which include their realized and unrealized
capital gains. With the addition of Temasek, the Government revenues
from Temasek’s contribution will expand from just its dividends to the
Government currently.
Enhanced existing and introduce new measures to support and promote
innovation, R&D and internationalisation of local companies. These
include:

Make it easier for SMEs who are engaging in innovation to apply to
SPRING for Capability Development Grants (CDG) by simplifying the
application process for projects below SGD30,000, and extend the
enhanced funding support level of up to 70% of costs for three more
years until 31 March 2018.

Top up the National Research Fund by SGD1b this year.

Raise the support level for SMEs for all activities under 1E Singapore’s
grant schemes like the Global Company Partnership (GCP) and Market
readiness Assistance (MRA) from 50% to 70% for three years.

Enhance the double tax deduction for internationalisation scheme to
include salaries incurred for Singaporeans posted overseas.

Introduce International Growth Scheme (IGS) to support larger
Singapore companies whereby qualifying companies will enjoy 10%
concessionary tax rate on their incremental income from qualifying
activities.

Increase and extend tax incentives for M&A by Singaporean companies,
especially by the SMEs e.g. increase the tax allowance for acquisition
costs from current 5% to 25% of the value of acquisition; allowing
companies to claim M&A benefits for acquisitions resulting in at least
20% shareholding in the target company, down from the current
threshold of 50% shareholding; extend the M&A scheme introduced in
2010 for another five years; extend the scope of IE Singapore’s
Internationalisation Finance Scheme (IFS) to support M&A that will aid
a company’s overseas expansion.
February 24, 2015
5
Singapore: Unemployment Rate (%)
Singapore: Productivity and Unit Labor cost (% YoY)
5.5
20
5.0
15
4.5
10
4.0
5
3.5
May-14
Jan-12
Mar-13
Nov-10
Jul-08
Sep-09
May-07
Jan-05
Mar-06
Nov-03
Jul-01
Sep-02
May-00
Jan-98
Mar-99
Nov-96
Jul-94
Sep-95
Mar-92
Jul-14
Nov-14
Mar-14
Jul-13
Nov-13
Mar-13
Jul-12
Nov-12
Mar-12
Jul-11
Nov-11
Mar-11
Jul-10
Unemployment Rate: sa
Nov-10
Mar-10
Jul-09
Jul-08
Jul-07
Nov-09
(20)
Mar-09
(15)
1.0
Nov-08
1.5
Mar-08
(10)
Nov-07
(5)
2.0
Mar-07
2.5
May-93
0
3.0
Labour Productivity (% YoY)
Unit Labour Cost of Overall Economy: 2005=100 (% YoY)
Unemployment Rate: Resident: Seasonally Adjusted
Source: CEIC
Source: CEIC
Singapore: Net Investment Commitments – Total (Annual.
SGDm)
Singapore: Net Investment – Manufacturing And Services
SGDm)
Source: CEIC
Source: CEIC
Singapore: Net Investment Commitments – Manufacturing
(Quarterly, % YoY)
Singapore: Net Investment – Total Manufacturing And
Services (Quarterly, % YoY)
300
12M Moving Avg (% YoY
250
250
12M Moving Avg (% YoY
Net Investment in Manufacturing And Services: Total
Net Investment Commitments (Manufacturing,% YoY)
200
200
150
150
100
100
50
50
0
0
(50)
(50)
(100)
February 24, 2015
Dec-14
Apr-14
Aug-14
Dec-13
Apr-13
Aug-13
Dec-12
Apr-12
Aug-12
Dec-11
Apr-11
Aug-11
Dec-10
Apr-10
Aug-10
Dec-09
Apr-09
Aug-09
Dec-08
Apr-08
Aug-08
Dec-14
Aug-14
Apr-14
Dec-13
Aug-13
Apr-13
Dec-12
Aug-12
Apr-12
Dec-11
Aug-11
Apr-11
Dec-10
Aug-10
Apr-10
Dec-09
Apr-09
Aug-09
Dec-08
Apr-08
Aug-08
Dec-07
Source: CEIC
Dec-07
(100)
(150)
Source: CEIC
6
Singapore: Property Price Index and Property Rental
Index (% YoY)
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
1994
0
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
May-14
Sep-14
1,000
0.0
2003
2,000
2.0
2002
3,000
4.0
2001
4,000
6.0
2000
5,000
8.0
60
50
40
30
20
10
0
(10)
(20)
(30)
(40)
1999
6,000
1998
10.0
1997
7,000
1996
12.0
1995
SGD b
Singapore: Residential Property Transaction (Value and
Units)
Property Price Index: Private Residential (PR): All % YoY
Property Rental Index: Residential % YoY
Residential Property Transaction: Value: Total
Residential Property Transaction: Deal: Total
Source: CEIC
Source: CEIC
60
50
Singapore: SGD vs. USD
200
1.90
150
1.80
100
1.70
50
1.60
40
30
20
10
0
0
(50)
Construction Progress Payments (3-MMA, % YoY, LHS)
Construction Contract Awards (3-MMA, % YoY)
Source: CEIC
February 24, 2015
(100)
Oct-14
Jun-14
Oct-13
Feb-14
Jun-13
Oct-12
Feb-13
Jun-12
Oct-11
Feb-12
Jun-11
Oct-10
Feb-11
Jun-10
Oct-09
Feb-10
Jun-09
Oct-08
Feb-09
Oct-07
Feb-08
(20)
Jun-08
(10)
1.50
1.40
1.30
1.20
1.10
Dec-95
Sep-96
Jun-97
Mar-98
Dec-98
Sep-99
Jun-00
Mar-01
Dec-01
Sep-02
Jun-03
Mar-04
Dec-04
Sep-05
Jun-06
Mar-07
Dec-07
Sep-08
Jun-09
Mar-10
Dec-10
Sep-11
Jun-12
Mar-13
Dec-13
Sep-14
Singapore: Construction Awards and Payment (% YoY)
Source: CEIC
7
Research Offices
REGIONAL
HONG KONG / CHINA
INDONESIA
WONG Chew Hann, CA
Regional Head of Institutional Research
(603) 2297 8686 [email protected]
Howard WONG Head of Research
(852) 2268 0648
[email protected]
• Oil & Gas - Regional
Wilianto IE Head of Research
(62) 21 2557 1125
[email protected]
• Strategy
Alexander LATZER
(852) 2268 0647
[email protected]
• Metals & Mining – Regional
Rahmi MARINA
(62) 21 2557 1128
[email protected]
• Banking & Finance
Benjamin HO
• Consumer & Auto
Aurellia SETIABUDI
(62) 21 2953 0785
[email protected]
• Property
ONG Seng Yeow
Regional Head of Retail Research
(65) 6432 1453
[email protected]
Alexander GARTHOFF
Institutional Product Manager
(852) 2268 0638
[email protected]
ECONOMICS
Suhaimi ILIAS
Chief Economist
Singapore | Malaysia
(603) 2297 8682
[email protected]
Luz LORENZO
Philippines
(63) 2 849 8836
[email protected]
Tim LEELAHAPHAN
Thailand
(66) 2658 6300 ext 1420
[email protected]
JUNIMAN
Chief Economist, BII
Indonesia
(62) 21 29228888 ext 29682
[email protected]
STRATEGY
Sadiq CURRIMBHOY
Global Strategist
Willie CHAN
Hong Kong / Regional
MALAYSIA
WONG Chew Hann, CA Head of Research
• Strategy • Construction & Infrastructure
Desmond CH’NG, ACA
(603) 2297 8680
[email protected]
LIAW Thong Jung
• Oil & Gas - Regional • Shipping
ONG Chee Ting, CA
• Plantations - Regional
Mohshin AZIZ
• Aviation - Regional • Petrochem
YIN Shao Yang, CPA
• Gaming – Regional • Media
TAN Chi Wei, CFA
• Power • Telcos
WONG Wei Sum, CFA
• Property & REITs
LEE Yen Ling
• Building Materials • Glove Producers
CHAI Li Shin, CFA
• Plantation • Construction & Infrastructure
Jacqueline KO, CFA
• Consumer Staples & Durables
Ka Leong LO, CFA
• Consumer Discretionary & Auto
Karen KWAN
• Property & REITs
Isnaputra ISKANDAR
(62) 21 2557 1129
[email protected]
• Metals & Mining • Cement
Pandu ANUGRAH
(62) 21 2557 1137
[email protected]
• Infra • Construction • Transport• Telcos
Mitchell KIM
• Internet & Telcos
Janni ASMAN
(62) 21 2953 0784
[email protected]
• Cigarette • Healthcare • Retail
Osbert TANG, CFA
(86) 21 5096 8370
[email protected]
• Transport & Industrials
Adhi TASMIN
(62) 21 2557 1209
[email protected]
• Plantations
Ricky WK NG, CFA
• Utilities & Renewable Energy
PHILIPPINES
Steven ST CHAN
• Banking & Financials - Regional
Luz LORENZO Head of Research
(63) 2 849 8836
[email protected]
• Strategy
• Utilities • Conglomerates • Telcos
Warren LAU
(852) 2268 0644
[email protected]
• Technology – Regional
Lovell SARREAL
(63) 2 849 8841
[email protected]
• Consumer • Media • Cement
INDIA
Rommel RODRIGO
(63) 2 849 8839
[email protected]
• Conglomerates • Property • Gaming
• Ports/ Logistics
Jigar SHAH Head of Research
(91) 22 6632 2632
[email protected]
• Oil & Gas • Automobile • Cement
Anubhav GUPTA
(91) 22 6623 2605
[email protected]
• Metal & Mining • Capital Goods • Property
Urmil SHAH
(91) 22 6623 2606 [email protected]
• Technology • Media
Vishal MODI
• Banking & Financials
Abhijeet Kundu
• Consumer
SINGAPORE
NG Wee Siang Head of Research
Gregory YAP
• SMID Caps – Regional
• Technology & Manufacturing • Telcos
YEAK Chee Keong, CFA
(65) 6231 5842
[email protected]
• Offshore & Marine
Katherine TAN
(63) 2 849 8843
[email protected]
• Banks • Construction
Ramon ADVIENTO
(63) 2 849 8845
[email protected]
• Mining
Michael BENGSON
(63) 2 849 8840
[email protected]
• Conglomerates
Jaclyn JIMENEZ
(63) 2 849 8842
[email protected]
• Consumer
Arabelle MAGHIRANG
(63) 2 849 8838
[email protected]
• Banks
THAILAND
Maria LAPIZ Head of Institutional Research
Dir (66) 2257 0250 | (66) 2658 6300 ext 1399
[email protected]
• Consumer • Materials • Ind.Estates
Derrick HENG, CFA
• Transport (Land, Shipping & Aviation)
Kevin WONG
• REITs
WEI Bin
• Commodity • Logistics • S-chips
LIEW Wei Han
• Consumer staples
John CHEONG
• Small & Mid Caps • Healthcare
Sittichai DUANGRATTANACHAYA
(66) 2658 6300 ext 1393
[email protected]
• Services Sector • Transport
TRUONG Thanh Hang
• Small & Mid Caps
Sukit UDOMSIRIKUL Head of Retail Research
(66) 2658 6300 ext 5090
[email protected]
Tee Sze Chiah Head of Retail Research
February 24, 2015
Surachai PRAMUALCHAROENKIT
(66) 2658 6300 ext 1470
[email protected]
• Auto • Conmat • Contractor • Steel
Suttatip PEERASUB
(66) 2658 6300 ext 1430
[email protected]
• Media • Commerce
Sutthichai KUMWORACHAI
(66) 2658 6300 ext 1400
[email protected]
• Energy • Petrochem
Termporn TANTIVIVAT
(66) 2658 6300 ext 1520
[email protected]
• Property
Jaroonpan WATTANAWONG
(66) 2658 6300 ext 1404
[email protected]
• Transportation • Small cap
Chatchai JINDARAT
(66) 2658 6300 ext 1401
[email protected]
• Electronics
VIETNAM
LE Hong Lien, ACCA
Head of Institutional Research
(84) 8 44 555 888 x 8181
[email protected]
• Strategy • Consumer • Diversified • Utilities
THAI Quang Trung, CFA, Deputy Manager,
Institutional Research
(84) 8 44 555 888 x 8180
[email protected]
• Real Estate • Construction • Materials
Le Nguyen Nhat Chuyen
(84) 8 44 555 888 x 8082
[email protected]
• Oil & Gas
NGUYEN Thi Ngan Tuyen, Head of Retail Research
(84) 8 44 555 888 x 8081
[email protected]
• Food & Beverage • Oil&Gas • Banking
TRINH Thi Ngoc Diep
(84) 4 44 555 888 x 8208
[email protected]
• Technology • Utilities • Construction
TRUONG Quang Binh
(84) 4 44 555 888 x 8087
[email protected]
• Rubber plantation • Tyres and Tubes • Oil&Gas
PHAM Nhat Bich
(84) 8 44 555 888 x 8083
[email protected]
• Consumer • Manufacturing • Fishery
NGUYEN Thi Sony Tra Mi
(84) 8 44 555 888 x 8084
[email protected]
• Port operation • Pharmaceutical
• Food & Beverage
Jesada TECHAHUSDIN, CFA
(66) 2658 6300 ext 1394
[email protected]
• Financial Services
Ivan YAP
• Automotive
LEE Cheng Hooi Regional Chartist
(603) 2297 8694
[email protected]
Padon VANNARAT
(66) 2658 6300 ext 1450
[email protected]
• Strategy
Kittisorn PRUITIPAT, CFA, FRM
(66) 2658 6300 ext 1395
[email protected]
• Real Estate • Telcos
Mayuree CHOWVIKRAN
(66) 2658 6300 ext 1440
[email protected]
• Strategy
8
APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLAIMERS AND DISCLOSURES
DISCLAIMERS
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This report may contain forward looking statements which are often but not always identified by the use of words such as “anticipate”, “believe”, “estimate”,
“intend”, “plan”, “expect”, “forecast”, “predict” and “project” and statements that an event or result “may”, “will”, “can”, “should”, “could” or “might”
occur or be achieved and other similar expressions. Such forward looking statements are based on assumptions made and information currently available to us
and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those expressed in any forward looking
statements. Readers are cautioned not to place undue relevance on these forward-looking statements. MKE expressly disclaims any obligation to update or
revise any such forward looking statements to reflect new information, events or circumstances after the date of this publication or to reflect the occurrence
of unanticipated events.
MKE and its officers, directors and employees, including persons involved in the preparation or issuance of this report, may, to the extent permitted by law,
from time to time participate or invest in financing transactions with the issuer(s) of the securities mentioned in this report, perform services for or solicit
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permitted by law, act upon or use the information presented herein, or the research or analysis on which they are based, before the material is published.
One or more directors, officers and/or employees of MKE may be a director of the issuers of the securities mentioned in this report.
This report is prepared for the use of MKE’s clients and may not be reproduced, altered in any way, transmitted to, copied or distributed to any other party in
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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,
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categories of investors. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply based on
geographical location of the person or entity receiving this report.
Malaysia
Opinions or recommendations contained herein are in the form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental
ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from Bursa Malaysia
Securities Berhad in the equity analysis.
Singapore
This report has been produced as of the date hereof and the information herein may be subject to change. Maybank Kim Eng Research Pte. Ltd. (“Maybank
KERPL”) in Singapore has no obligation to update such information for any recipient. For distribution in Singapore, recipients of this report are to contact
Maybank KERPL in Singapore in respect of any matters arising from, or in connection with, this report. If the recipient of this report is not an accredited
investor, expert investor or institutional investor (as defined under Section 4A of the Singapore Securities and Futures Act), Maybank KERPL shall be legally
liable for the contents of this report, with such liability being limited to the extent (if any) as permitted by law.
Thailand
The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the
Office of the Securities and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand
and the market for Alternative Investment disclosed to the public and able to be accessed by a general public investor. The result, therefore, is from the
perspective of a third party. It is not an evaluation of operation and is not based on inside information. The survey result is as of the date appearing in the
Corporate Governance Report of Thai Listed Companies. As a result, the survey may be changed after that date. Maybank Kim Eng Securities (Thailand) Public
Company Limited (“MBKET”) does not confirm nor certify the accuracy of such survey result.
Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of MBKET.
MBKET accepts no liability whatsoever for the actions of third parties in this respect.
US
This research report prepared by MKE is distributed in the United States (“US”) to Major US Institutional Investors (as defined in Rule 15a-6 under the
Securities Exchange Act of 1934, as amended) only by Maybank Kim Eng Securities USA Inc (“Maybank KESUSA”), a broker-dealer registered in the US
(registered under Section 15 of the Securities Exchange Act of 1934, as amended). All responsibility for the distribution of this report by Maybank KESUSA in
the US shall be borne by Maybank KESUSA. All resulting transactions by a US person or entity should be effected through a registered broker-dealer in the US.
This report is not directed at you if MKE is prohibited or restricted by any legislation or regulation in any jurisdiction from making it available to you. You
should satisfy yourself before reading it that Maybank KESUSA is permitted to provide research material concerning investments to you under relevant
legislation and regulations.
UK
This document is being distributed by Maybank Kim Eng Securities (London) Ltd (“Maybank KESL”) which is authorized and regulated, by the Financial Services
Authority and is for Informational Purposes only. This document is not intended for distribution to anyone defined as a Retail Client under the Financial
Services and Markets Act 2000 within the UK. Any inclusion of a third party link is for the recipients convenience only, and that the firm does not take any
responsibility for its comments or accuracy, and that access to such links is at the individuals own risk. Nothing in this report should be considered as
constituting legal, accounting or tax advice, and that for accurate guidance recipients should consult with their own independent tax advisers.
February 24, 2015
9
DISCLOSURES
Legal Entities Disclosures
Malaysia: This report is issued and distributed in Malaysia by Maybank Investment Bank Berhad (15938-H) which is a Participating Organization of Bursa
Malaysia Berhad and a holder of Capital Markets and Services License issued by the Securities Commission in Malaysia. Singapore: This material is issued and
distributed in Singapore by Maybank KERPL (Co. Reg No 197201256N) which is regulated by the Monetary Authority of Singapore. Indonesia: PT Kim Eng
Securities (“PTKES”) (Reg. No. KEP-251/PM/1992) is a member of the Indonesia Stock Exchange and is regulated by the BAPEPAM LK. Thailand: MBKET (Reg.
No.0107545000314) is a member of the Stock Exchange of Thailand and is regulated by the Ministry of Finance and the Securities and Exchange Commission.
Philippines: Maybank ATRKES (Reg. No.01-2004-00019) is a member of the Philippines Stock Exchange and is regulated by the Securities and Exchange
Commission. Vietnam: Maybank Kim Eng Securities Limited (License Number: 117/GP-UBCK) is licensed under the State Securities Commission of
Vietnam.Hong Kong: KESHK (Central Entity No AAD284) is regulated by the Securities and Futures Commission. India: Kim Eng Securities India Private Limited
(“KESI”) is a participant of the National Stock Exchange of India Limited (Reg No: INF/INB 231452435) and the Bombay Stock Exchange (Reg. No. INF/INB
011452431) and is regulated by Securities and Exchange Board of India. KESI is also registered with SEBI as Category 1 Merchant Banker (Reg. No. INM
000011708) US: Maybank KESUSA is a member of/ and is authorized and regulated by the FINRA – Broker ID 27861. UK: Maybank KESL (Reg No 2377538) is
authorized and regulated by the Financial Services Authority.
Disclosure of Interest
Malaysia: MKE and its Representatives may from time to time have positions or be materially interested in the securities referred to herein and may further
act as market maker or may have assumed an underwriting commitment or deal with such securities and may also perform or seek to perform investment
banking services, advisory and other services for or relating to those companies.
Singapore: As of 24 February 2015, Maybank KERPL and the covering analyst do not have any interest in any companies recommended in this research report.
Thailand: MBKET may have a business relationship with or may possibly be an issuer of derivative warrants on the securities /companies mentioned in the
research report. Therefore, Investors should exercise their own judgment before making any investment decisions. MBKET, its associates, directors, connected
parties and/or employees may from time to time have interests and/or underwriting commitments in the securities mentioned in this report.
Hong Kong: KESHK may have financial interests in relation to an issuer or a new listing applicant referred to as defined by the requirements under Paragraph
16.5(a) of the Hong Kong Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission.
As of 24 February 2015, KESHK and the authoring analyst do not have any interest in any companies recommended in this research report.
MKE may have, within the last three years, served as manager or co-manager of a public offering of securities for, or currently may make a primary market in
issues of, any or all of the entities mentioned in this report or may be providing, or have provided within the previous 12 months, significant advice or
investment services in relation to the investment concerned or a related investment and may receive compensation for the services provided from the
companies covered in this report.
OTHERS
Analyst Certification of Independence
The views expressed in this research report accurately reflect the analyst’s personal views about any and all of the subject securities or issuers; and no part of
the research analyst’s compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in the report.
Reminder
Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to sophisticated investors who are capable
of understanding and assuming the risks involved. The market value of any structured security may be affected by changes in economic, financial and political
factors (including, but not limited to, spot and forward interest and exchange rates), time to maturity, market conditions and volatility and the credit quality
of any issuer or reference issuer. Any investor interested in purchasing a structured product should conduct its own analysis of the product and consult with its
own professional advisers as to the risks involved in making such a purchase.
No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior consent of MKE.
Ong Seng Yeow | Executive Director, Maybank Kim Eng Research
Definition of Ratings
Maybank Kim Eng Research uses the following rating system
BUY
Return is expected to be above 10% in the next 12 months (excluding dividends)
HOLD
Return is expected to be between - 10% to +10% in the next 12 months (excluding dividends)
SELL
Return is expected to be below -10% in the next 12 months (excluding dividends)
Applicability of Ratings
The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only
applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment
ratings as we do not actively follow developments in these companies.
February 24, 2015
10
 Malaysia
Maybank Investment Bank Berhad
(A Participating Organisation of
Bursa Malaysia Securities Berhad)
33rd Floor, Menara Maybank,
100 Jalan Tun Perak,
50050 Kuala Lumpur
Tel: (603) 2059 1888;
Fax: (603) 2078 4194
Stockbroking Business:
Level 8, Tower C, Dataran Maybank,
No.1, Jalan Maarof
59000 Kuala Lumpur
Tel: (603) 2297 8888
Fax: (603) 2282 5136
 Philippines
Maybank ATR Kim Eng Securities Inc.
17/F, Tower One & Exchange Plaza
Ayala Triangle, Ayala Avenue
Makati City, Philippines 1200
Tel: (63) 2 849 8888
Fax: (63) 2 848 5738
 Singapore
Maybank Kim Eng Securities Pte Ltd
Maybank Kim Eng Research Pte Ltd
50 North Canal Road
Singapore 059304
Maybank Kim Eng Securities
(London) Ltd
5th Floor, Aldermary House
10-15 Queen Street
London EC4N 1TX, UK
Tel: (65) 6336 9090
Tel: (44) 20 7332 0221
Fax: (44) 20 7332 0302
 Hong Kong
 Indonesia
 New York
Maybank Kim Eng Securities USA
Inc
777 Third Avenue, 21st Floor
New York, NY 10017, U.S.A.
Tel: (212) 688 8886
Fax: (212) 688 3500
 India
Kim Eng Securities (HK) Ltd
Level 30,
Three Pacific Place,
1 Queen’s Road East,
Hong Kong
PT Maybank Kim Eng Securities
Plaza Bapindo
Citibank Tower 17th Floor
Jl Jend. Sudirman Kav. 54-55
Jakarta 12190, Indonesia
Kim Eng Securities India Pvt Ltd
2nd Floor, The International 16,
Maharishi Karve Road,
Churchgate Station,
Mumbai City - 400 020, India
Tel: (852) 2268 0800
Fax: (852) 2877 0104
Tel: (62) 21 2557 1188
Fax: (62) 21 2557 1189
Tel: (91) 22 6623 2600
Fax: (91) 22 6623 2604
 Thailand
Maybank Kim Eng Securities
(Thailand) Public Company Limited
999/9 The Offices at Central World,
20th - 21st Floor,
Rama 1 Road Pathumwan,
Bangkok 10330, Thailand
Tel: (66) 2 658 6817 (sales)
Tel: (66) 2 658 6801 (research)
 South Asia Sales Trading
 London
 Vietnam
Maybank Kim Eng Securities Limited
4A-15+16 Floor Vincom Center Dong
Khoi, 72 Le Thanh Ton St. District 1
Ho Chi Minh City, Vietnam
Tel : (84) 844 555 888
Fax : (84) 8 38 271 030
 Saudi Arabia
In association with
Anfaal Capital
Villa 47, Tujjar Jeddah
Prince Mohammed bin Abdulaziz
Street P.O. Box 126575
Jeddah 21352
Tel: (966) 2 6068686
Fax: (966) 26068787
 North Asia Sales Trading
Kevin Foy
Regional Head Sales Trading
[email protected]
Tel: (65) 6336-5157
US Toll Free: 1-866-406-7447
Alex Tsun
[email protected]
Tel: (852) 2268 0228
US Toll Free: 1 877 837 7635
Malaysia
Thailand
Rommel Jacob
[email protected]
Tel: (603) 2717 5152
Tanasak Krishnasreni
[email protected]
Tel: (66)2 658 6820
Indonesia
Harianto Liong
[email protected]
Tel: (62) 21 2557 1177
New York
India
Andrew Dacey
[email protected]
Tel: (212) 688 2956
Manish Modi
[email protected]
Tel: (91)-22-6623-2601
Vietnam
Philippines
Tien Nguyen
Keith Roy
[email protected]
Tel: (63) 2 848-5288
[email protected]
Tel: (84) 44 555 888 x8079
February 24, 2015
www.maybank-ke.com | www.maybank-keresearch.com
11

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