JPM_life_insurance

Document Sample
JPM_life_insurance Powered By Docstoc
					                                                                                                                    Asia Pacific Equity Research
                                                                                                                    30 November 2010




Life Insurance Tracker
Oct-10: Taking it on the chin


•     Oct-10- premium contraction continues: The new ULIP guidelines                                                India
      have started to take heavy toll on the life insurance sales. Oct-10                                           Insurance
      premiums contracted by 33% m/m for private insurers – partly because                                          Seshadri K Sen, CFA
                                                                                                                                                       AC

      the Sep-10 numbers (23% m/m drop) were cushioned by August                                                    (91-22) 6157-3575
      spillover. YTD private sector premium are still positive (+2% y/y),                                           seshadri.k.sen@jpmorgan.com
      given the strong 1H11.                                                                                        J.P. Morgan India Private Limited

•     Product mix would take time to stabilise: Our interactions with                                               Adarsh Parasrampuria
                                                                                                                    (91-22) 6157-3576
      various managements indicate sequential acceleration after Oct-10,                                            adarsh.x.parasrampuria@jpmorgan.com
      though y/y contraction should continue. Most insurers are still in the
                                                                                                                    J.P. Morgan India Private Limited
      process of launching new ULIP policies and have been waiting IRDA
      approval till late Oct-10. Launch of new ULIPS should aid volumes                                             Sunil Garg
                                                                                                                    (852) 2800-8518
      over the next 2-3 mnts.                                                                                       sunil.garg@jpmorgan.com

•     Expect marginal negative FY11 growth for private insurers: YTD                                                J.P. Morgan Securities (Asia Pacific) Limited

      premium collections is still positive at +2% YTD for privte insurers.
      We expect y/y contraction in volumes over the next 3-4 mnts and thus                                          Private insurers YTD markets share
                                                                                                                    change
      expect marginal contraction in FY11 for private insurers. LIC's ~95%
                                                                                                                               SBI
      YTD growth should lead to a strong volume growth for the industry.
                                                                                                                             Bajaj
      Among private insurers, HDFC Standard and ICICI Pru has been the                                                        Birla
      strongest with YTD market share gains.                                                                          R eliance

•     Margins under pressure, remain cautious: NBAP margins for the                                                          Kotak
                                                                                                                              Max
      sector would be under pressure form here post the implementation of
                                                                                                                      IC IC I Pru
      new ULIP guidelines. Our interactions with various managements
                                                                                                                             HDFC
      indicate that costs and persistency would need to closely monitored to
      achieve ~14-15% NBAP margins with further risks from higher taxes                                                          -10.0%     -5.0%          0.0%     5.0%
      (DTC). We continue to maintain our cautious stance on the sector.                                             Source: IRDA, J.P. Morgan


Figure 1: Premium growth for Private insurers and LIC                        Figure 2: Premium growth coming off from Sep-10
    200%                Y/Y Priv ate         Y/Y Public                         70%

    150%                                                                        50%
                                                                                30%
    100%
                                                                                10%
    50%
                                                                               -10%
     0%                                                                        -30%
    -50%                                                                       -50%
            Jan-08
           Mar-08

             Jul-08
           Sep-08

            Jan-09
           Mar-09

             Jul-09
           Sep-09

            Jan-10
           Mar-10

             Jul-10
           Sep-10




                                                                                                 Jul-08
                                                                                                Sep-08


                                                                                                           Jan-09
                                                                                                          M ar-09


                                                                                                                    Jul-09
                                                                                                                             Sep-09


                                                                                                                                       Jan-10
                                                                                                                                       M ar-10


                                                                                                                                                  Jul-10
                                                                                                                                                           Sep-10
           Nov-07



           May-08



           Nov-08



           May-09



           Nov-09



           May-10




                                                                                      M ay-08



                                                                                                          N ov-08



                                                                                                          M ay-09



                                                                                                                             N ov-09



                                                                                                                                                 M ay-10




Source : IRDA, J.P. Morgan                                                   Source: IRDA.


•.

See page 6 for analyst certification and important disclosures, including non-US analyst disclosures.
J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may
have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their
investment decision.
Seshadri K Sen, CFA                          Asia Pacific Equity Research
(91-22) 6157-3575                            30 November 2010
seshadri.k.sen@jpmorgan.com




Table 1: New Business Premium- Private Insurers’ premiums contracted 33% m/m
         Life Insurer         FY10YTD WRP    FY11YTD WRP         y/y %      WRP Oct-09    WRP Sep 10    WRP Oct-10     y/y %   m/m %
                                 (Rs mn)        (Rs mn)         change       (Rs mn)       (Rs mn)       (Rs mn)      change   change
Grand Total                        265,554          379,824          43%         47,410        44,479        37,330     -21%     -16%
LIC                                117,311          228,799          95%         20,060        21,273        21,862       9%       3%
Total Private                      148,243          151,025           2%         27,350        23,206        15,467     -43%     -33%

Bajaj Allianz                       15,837           13,240         -16%          2,858         2,276         1,715     -40%     -25%
ING Vysya                            3,345            3,166          -5%            400           594           479      20%     -19%
Reliance Life                       13,588           14,046           3%          2,259         1,551         1,468     -35%      -5%
SBI Life                            27,569           19,795         -28%          6,416         5,124         1,827     -72%     -64%
Tata AIG                             5,948            5,839          -2%            998         1,071           651     -35%     -39%
HDFC Standard                       12,030           17,972          49%          2,062         2,557         2,174       5%     -15%
ICICI Prudential                    24,374           30,117          24%          4,368         3,208         2,076     -52%     -35%
Birla Sunlife                       13,099           11,602         -11%          2,332         1,437         1,187     -49%     -17%
Aviva                                3,320            3,535           6%            596           347           407     -32%      17%
Kotak Mahindra Old Mutual            4,440            5,091          15%            899           855           414     -54%     -52%
Max New York                         9,022            9,976          11%          1,468         1,832         1,276     -13%     -30%
Met Life                             4,224            2,861         -32%            700           435           328     -53%     -25%
Sahara Life                            519              275         -47%             63            32            22     -65%     -30%
Shriram Life                         1,380            1,335          -3%            193           284            57     -71%     -80%
Bharti Axa Life                      1,719            2,042          19%            272           154           179     -34%      17%
Source: IRDA, J.P. Morgan




Table 2: New Business Premium – Unweighted Basis
         Life Insurer         FY10YTD (Rs     FY11YTD (Rs        y/y %      Oct-09 (Rs    Sep-10 (Rs    Oct-10 (Rs     y/y %   m/m %
                                  mn)             mn)           change         mn)           mn)           mn)        change   change

Grand Total                        466,913          694,382          49%         76,447        95,479        73,111      -4%     -23%
LIC                                304,711          506,070          66%         46,566        66,066        49,158       6%     -26%
Total Private                      162,202          188,312          16%         29,881        29,413        23,953     -20%     -19%

Bajaj Allianz                       17,526           17,476           0%          3,135         2,772         2,370     -24%     -15%
ING Vysya                            3,434            3,241          -6%            413           609           500      21%     -18%
Reliance Life                       14,995           16,191           8%          2,510         2,040         2,091     -17%       3%
SBI Life                            30,742           35,403          15%          6,832         7,817         3,686     -46%     -53%
Tata AIG                             6,157            7,042          14%          1,026         1,235           784     -24%     -37%
HDFC Standard                       13,938           18,588          33%          2,734         2,647         2,225     -19%     -16%
ICICI Prudential                    25,880           36,407          41%          4,601         4,244         6,252      36%      47%
Birla Sunlife                       13,325           11,723         -12%          2,359         1,448         1,199     -49%     -17%
Aviva                                3,662            3,697           1%            622           355           410     -34%      15%
Kotak Mahindra Old Mutual            4,770            5,879          23%            977           962           501     -49%     -48%
Max New York                        10,029           11,185          12%          1,609         1,986         1,492      -7%     -25%
Met Life                             4,481            3,417         -24%            725           504           345     -52%     -32%
Sahara Life                            676              461         -32%             87            45            40     -54%     -11%
Shriram Life                         1,726            2,997          74%            225           691           320      42%     -54%
Bharti Axa Life                      1,871            2,175          16%            301           172           197     -35%      14%
Source: IRDA, J.P. Morgan




2
  Seshadri K Sen, CFA                  Asia Pacific Equity Research
  (91-22) 6157-3575                    30 November 2010
  seshadri.k.sen@jpmorgan.com




                                       Table 3: Insurance: Valuations
                                                                                         ICICI Pru      HDFC SL        SBI Life            Kotak
                                        Value of business (Rs bn)                              161.2         87.1           105.0              28.5
                                        EV (Rs bn)                                              78.2         32.0            30.5              14.1
                                        PV of NBAP (Rs bn)                                      83.0         55.1            74.5              14.5
                                        P/NBAP                                                  20.4        16.96           14.96             18.29
                                        P/NBAP (ex-EV)                                         10.51        10.73           10.61              9.26
                                        P/EV                                                    1.90         2.52            3.17              1.87
                                        P/AUM                                                 31.3%        56.1%           61.5%             52.4%

                                        NBAP Margins - Long term                             13.5%          14.5%           14.0%            14.0%
                                        Cost of Equity                                       17.5%          16.9%           17.5%            17.2%

                                        Contribution to parent (Rs/share)                         91           37            104                 24
                                        % of PT                                                7.0%         4.6%            3.2%              4.3%
                                       Source: Company, J.P.Morgan estimates




                                       Table 4: Life Insurance - Market Share (WRP) for Sep-10
                                                                                                                                              m/m
                                                                    F2010      F2011     Change                                              change
                                            Life Insurer             YTD        YTD      (% pts)       Oct-09   Sep-10        Oct-10         (% pts)
                                       LIC                            44.2%      60.2%     16.1%        42.3%     47.8%        58.6%           10.7%
                                       Total Private                  55.8%      39.8%    -16.1%        57.7%     52.2%        41.4%          -10.7%

                                       Bajaj Allianz                  6.0%       3.5%       -2.5%        6.0%        5.1%           4.6%        -0.5%
                                       ING Vysya                      1.3%       0.8%       -0.4%        0.8%        1.3%           1.3%        -0.1%
                                       Reliance Life                  5.1%       3.7%       -1.4%        4.8%        3.5%           3.9%         0.4%
                                       SBI Life                      10.4%       5.2%       -5.2%       13.5%       11.5%           4.9%        -6.6%
                                       Tata AIG                       2.2%       1.5%       -0.7%        2.1%        2.4%           1.7%        -0.7%
                                       HDFC Standard                  4.5%       4.7%        0.2%        4.3%        5.7%           5.8%         0.1%
LIC share has increased to ~59% from   ICICI Prudential               9.2%       7.9%       -1.2%        9.2%        7.2%           5.6%        -1.7%
48% in Sep-10.                         Birla Sunlife                  4.9%       3.1%       -1.9%        4.9%        3.2%           3.2%        -0.1%
                                       Aviva                          1.3%       0.9%       -0.3%        1.3%        0.8%           1.1%         0.3%
                                       Kotak Mahindra Old
                                       Mutual                          1.7%      1.3%       -0.3%        1.9%       1.9%            1.1%        -0.8%
                                       Max New York                    3.4%      2.6%       -0.8%        3.1%       4.1%            3.4%        -0.7%
                                       Met Life                        1.6%      0.8%       -0.8%        1.5%       1.0%            0.9%        -0.1%
                                       Sahara Life                     0.2%      0.1%       -0.1%        0.1%       0.1%            0.1%         0.0%
                                       Shriram Life                    0.5%      0.4%       -0.2%        0.4%       0.6%            0.2%        -0.5%
                                       Bharti Axa Life                 0.6%      0.5%       -0.1%        0.6%       0.3%            0.5%         0.1%
                                       Future Generali *               0.7%      0.5%       -0.1%        0.8%       0.6%            1.0%         0.4%
                                       IDBI Fortis Life**              0.5%      0.4%        0.0%        0.3%       0.9%            0.5%        -0.4%
                                       Canara HSBC OBC                 1.2%      1.0%       -0.2%        1.2%       1.1%            0.8%        -0.3%
                                       Aegon Religare                  0.2%      0.3%        0.1%        0.3%       0.2%            0.4%         0.2%
                                       DLF Pramerica                   0.0%      0.1%        0.1%        0.0%       0.1%            0.1%         0.0%
                                       Star Union Dai ichi             0.4%      0.3%        0.0%        0.5%       0.4%            0.4%         0.0%


                                       Source: IRDA, J.P. Morgan




                                                                                                                                                      3
Seshadri K Sen, CFA           Asia Pacific Equity Research
(91-22) 6157-3575             30 November 2010
seshadri.k.sen@jpmorgan.com




                              Table 5: Life Insurance - Private Insurers market share (APE Basis)
                                                                                                                        m/m
                                                          F2010     F2011    Change                                    change
                                     Life Insurer          YTD       YTD     (% pts)   Oct-09       Sep-10    Oct-10   (% pts)
                              Bajaj Allianz                 10.7%     8.8%     -1.9%    10.4%          9.8%    11.1%      1.3%
                              ING Vysya                      2.3%     2.1%     -0.2%     1.5%          2.6%     3.1%      0.5%
                              Reliance Life                  9.2%     9.3%      0.1%     8.3%          6.7%     9.5%      2.8%
                              SBI Life                     18.6%     13.1%     -5.5%    23.5%         22.1%    11.8%    -10.3%
                              Tata AIG                       4.0%     3.9%     -0.1%     3.6%          4.6%     4.2%     -0.4%
                              HDFC Standard                  8.1%    11.9%      3.8%     7.5%         11.0%    14.1%      3.0%
                              ICICI Prudential             16.4%     19.9%      3.5%    16.0%         13.8%    13.4%     -0.4%
                              Birla Sunlife                  8.8%     7.7%     -1.2%     8.5%          6.2%     7.7%      1.5%
                              Aviva                          2.2%     2.3%      0.1%     2.2%          1.5%     2.6%      1.1%
                              Kotak                          3.0%     3.4%      0.4%     3.3%          3.7%     2.7%     -1.0%
                              Max New York                   6.1%     6.6%      0.5%     5.4%          7.9%     8.3%      0.4%
                              Met Life                       2.8%     1.9%     -1.0%     2.6%          1.9%     2.1%      0.2%
                              Sahara Life                    0.4%     0.2%     -0.2%     0.2%          0.1%     0.1%      0.0%
                              Shriram Life                   0.9%     0.9%      0.0%     0.7%          1.2%     0.4%     -0.9%
                              Bharti Axa Life                1.2%     1.4%      0.2%     1.0%          0.7%     1.2%      0.5%
                              Future Generali *              1.2%     1.4%      0.1%     1.4%          1.1%     2.4%      1.3%
                              IDBI Fortis Life**             0.8%     1.1%      0.3%     0.6%          1.7%     1.2%     -0.6%
                              Canara HSBC OBC                2.2%     2.5%      0.3%     2.1%          2.1%     2.0%     -0.1%
                              Aegon Religare                 0.3%     0.7%      0.4%     0.4%          0.3%     1.0%      0.7%
                              DLF Pramerica                  0.1%     0.3%      0.2%     0.1%          0.3%     0.4%      0.1%
                              Star Union Dai ichi            0.6%     0.8%      0.2%     0.8%          0.7%     0.9%      0.2%
                              Source: IRDA, J.P. Morgan




                              Figure 3: Market share trends (WRP basis) - LIC vs. Private
                                80%
                                70%
                                60%
                                50%
                                40%
                                30%
                                20%
                                10%
                                         Jul-07
                                        Sep-07

                                        Jan-08
                                        Mar-08

                                         Jul-08
                                        Sep-08

                                        Jan-09
                                        Mar-09

                                         Jul-09
                                        Sep-09

                                        Jan-10
                                        Mar-10

                                         Jul-10
                                        Sep-10
                                        May-07



                                        Nov-07



                                        May-08



                                        Nov-08



                                        May-09



                                        Nov-09



                                        May-10




                                                              LIC                                              Private
                              Source: IRDA, J.P. Morgan




4
Seshadri K Sen, CFA           Asia Pacific Equity Research
(91-22) 6157-3575             30 November 2010
seshadri.k.sen@jpmorgan.com




                              Figure 4: Market share trend of selected private players (WRP)
                               35%
                               30%

                               25%

                               20%

                               15%
                               10%

                                 5%

                                 0%

                                -5%
                                      Mar-07


                                                        Jul-07
                                                                 Sep-07


                                                                                   Jan-08
                                                                                            Mar-08


                                                                                                              Jul-08
                                                                                                                       Sep-08


                                                                                                                                          Jan-09
                                                                                                                                                   Mar-09


                                                                                                                                                                     Jul-09
                                                                                                                                                                              Sep-09


                                                                                                                                                                                                Jan-10
                                                                                                                                                                                                         Mar-10


                                                                                                                                                                                                                           Jul-10
                                                                                                                                                                                                                                    Sep-10
                                               May-07



                                                                          Nov-07



                                                                                                     May-08



                                                                                                                                Nov-08



                                                                                                                                                            May-09



                                                                                                                                                                                       Nov-09



                                                                                                                                                                                                                  May-10
                                                                                   ICICI Prudential                                      Reliance Life                                    Bajaj Allianz
                                                                                   SBI Life                                              Birla Sunlife                                    HDFC Standard




                              Source: IRDA, J.P. Morgan




                                                                                                                                                                                                                                             5
Seshadri K Sen, CFA                              Asia Pacific Equity Research
(91-22) 6157-3575                                30 November 2010
seshadri.k.sen@jpmorgan.com




Analyst Certification:
The research analyst(s) denoted by an “AC” on the cover of this report certifies (or, where multiple research analysts are primarily
responsible for this report, the research analyst denoted by an “AC” on the cover or within the document individually certifies, with
respect to each security or issuer that the research analyst covers in this research) that: (1) all of the views expressed in this report
accurately reflect his or her personal views about any and all of the subject securities or issuers; and (2) no part of any of the research
analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed by the
research analyst(s) in this report.
Important Disclosures


Explanation of Equity Research Ratings and Analyst(s) Coverage Universe:
J.P. Morgan uses the following rating system: Overweight [Over the next six to twelve months, we expect this stock will outperform the
average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Neutral [Over the next six to twelve
months, we expect this stock will perform in line with the average total return of the stocks in the analyst’s (or the analyst’s team’s)
coverage universe.] Underweight [Over the next six to twelve months, we expect this stock will underperform the average total return of
the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] J.P. Morgan Cazenove’s UK Small/Mid-Cap dedicated research
analysts use the same rating categories; however, each stock’s expected total return is compared to the expected total return of the FTSE
All Share Index, not to those analysts’ coverage universe. A list of these analysts is available on request. The analyst or analyst’s team’s
coverage universe is the sector and/or country shown on the cover of each publication. See below for the specific stocks in the certifying
analyst(s) coverage universe.


Coverage Universe: Seshadri K Sen, CFA: Axis Bank Ltd (AXBK.BO), HDFC (Housing Development Finance
Corporation) (HDFC.BO), HDFC Bank (HDBK.BO), ICICI Bank (ICBK.BO), IDFC (IDFC.BO), IndusInd Bank
(INBK.BO), Kotak Mahindra Bank (KTKM.BO), SKS Microfinance (SKSM.BO), State Bank of India (SBI.BO)

J.P. Morgan Equity Research Ratings Distribution, as of September 30, 2010
                                                Overweight      Neutral     Underweight
                                                (buy)           (hold)      (sell)
J.P. Morgan Global Equity Research              46%             43%         12%
Coverage
   IB clients*                                   49%            45%         33%
JPMS Equity Research Coverage                    43%            48%         8%
   IB clients*                                   69%            60%         50%
*Percentage of investment banking clients in each rating category.
For purposes only of FINRA/NYSE ratings distribution rules, our Overweight rating falls into a buy rating category; our Neutral rating falls into a hold
rating category; and our Underweight rating falls into a sell rating category.



Valuation and Risks: Please see the most recent company-specific research report for an analysis of valuation methodology and risks on
any securities recommended herein. Research is available at http://www.morganmarkets.com , or you can contact the analyst named on
the front of this note or your J.P. Morgan representative.

Analysts’ Compensation: The equity research analysts responsible for the preparation of this report receive compensation based upon
various factors, including the quality and accuracy of research, client feedback, competitive factors, and overall firm revenues, which
include revenues from, among other business units, Institutional Equities and Investment Banking.

Registration of non-US Analysts: Unless otherwise noted, the non-US analysts listed on the front of this report are employees of non-US
affiliates of JPMS, are not registered/qualified as research analysts under FINRA/NYSE rules, may not be associated persons of JPMS,
and may not be subject to FINRA Rule 2711 and NYSE Rule 472 restrictions on communications with covered companies, public
appearances, and trading securities held by a research analyst account.

Other Disclosures

J.P. Morgan ("JPM") is the global brand name for J.P. Morgan Securities LLC ("JPMS") and its affiliates worldwide. J.P. Morgan Cazenove is a
marketing name for the U.K. investment banking businesses and EMEA cash equities and equity research businesses of JPMorgan Chase & Co.
and its subsidiaries.


6
Seshadri K Sen, CFA                            Asia Pacific Equity Research
(91-22) 6157-3575                              30 November 2010
seshadri.k.sen@jpmorgan.com




Options related research: If the information contained herein regards options related research, such information is available only to persons who
have received the proper option risk disclosure documents. For a copy of the Option Clearing Corporation’s Characteristics and Risks of
Standardized Options, please contact your J.P. Morgan Representative or visit the OCC’s website at
http://www.optionsclearing.com/publications/risks/riskstoc.pdf.
Legal Entities Disclosures
U.S.: JPMS is a member of NYSE, FINRA and SIPC. J.P. Morgan Futures Inc. is a member of the NFA. JPMorgan Chase Bank, N.A. is a
member of FDIC and is authorized and regulated in the UK by the Financial Services Authority. U.K.: J.P. Morgan Securities Ltd. (JPMSL) is a
member of the London Stock Exchange and is authorized and regulated by the Financial Services Authority. Registered in England & Wales No.
2711006. Registered Office 125 London Wall, London EC2Y 5AJ. South Africa: J.P. Morgan Equities Limited is a member of the Johannesburg
Securities Exchange and is regulated by the FSB. Hong Kong: J.P. Morgan Securities (Asia Pacific) Limited (CE number AAJ321) is regulated
by the Hong Kong Monetary Authority and the Securities and Futures Commission in Hong Kong. Korea: J.P. Morgan Securities (Far East) Ltd,
Seoul Branch, is regulated by the Korea Financial Supervisory Service. Australia: J.P. Morgan Australia Limited (ABN 52 002 888 011/AFS
Licence No: 238188) is regulated by ASIC and J.P. Morgan Securities Australia Limited (ABN 61 003 245 234/AFS Licence No: 238066) is a
Market Participant with the ASX and regulated by ASIC. Taiwan: J.P.Morgan Securities (Taiwan) Limited is a participant of the Taiwan Stock
Exchange (company-type) and regulated by the Taiwan Securities and Futures Bureau. India: J.P. Morgan India Private Limited is a member of
the National Stock Exchange of India Limited and Bombay Stock Exchange Limited and is regulated by the Securities and Exchange Board of
India. Thailand: JPMorgan Securities (Thailand) Limited is a member of the Stock Exchange of Thailand and is regulated by the Ministry of
Finance and the Securities and Exchange Commission. Indonesia: PT J.P. Morgan Securities Indonesia is a member of the Indonesia Stock
Exchange and is regulated by the BAPEPAM LK. Philippines: J.P. Morgan Securities Philippines Inc. is a member of the Philippine Stock
Exchange and is regulated by the Securities and Exchange Commission. Brazil: Banco J.P. Morgan S.A. is regulated by the Comissao de Valores
Mobiliarios (CVM) and by the Central Bank of Brazil. Mexico: J.P. Morgan Casa de Bolsa, S.A. de C.V., J.P. Morgan Grupo Financiero is a
member of the Mexican Stock Exchange and authorized to act as a broker dealer by the National Banking and Securities Exchange Commission.
Singapore: This material is issued and distributed in Singapore by J.P. Morgan Securities Singapore Private Limited (JPMSS) [MICA (P)
020/01/2010 and Co. Reg. No.: 199405335R] which is a member of the Singapore Exchange Securities Trading Limited and is regulated by the
Monetary Authority of Singapore (MAS) and/or JPMorgan Chase Bank, N.A., Singapore branch (JPMCB Singapore) which is regulated by the
MAS. Malaysia: This material is issued and distributed in Malaysia by JPMorgan Securities (Malaysia) Sdn Bhd (18146-X) which is a
Participating Organization of Bursa Malaysia Berhad and a holder of Capital Markets Services License issued by the Securities Commission in
Malaysia. Pakistan: J. P. Morgan Pakistan Broking (Pvt.) Ltd is a member of the Karachi Stock Exchange and regulated by the Securities and
Exchange Commission of Pakistan. Saudi Arabia: J.P. Morgan Saudi Arabia Ltd. is authorized by the Capital Market Authority of the Kingdom
of Saudi Arabia (CMA) to carry out dealing as an agent, arranging, advising and custody, with respect to securities business under licence number
35-07079 and its registered address is at 8th Floor, Al-Faisaliyah Tower, King Fahad Road, P.O. Box 51907, Riyadh 11553, Kingdom of Saudi
Arabia. Dubai: JPMorgan Chase Bank, N.A., Dubai Branch is regulated by the Dubai Financial Services Authority (DFSA) and its registered
address is Dubai International Financial Centre - Building 3, Level 7, PO Box 506551, Dubai, UAE.
Country and Region Specific Disclosures
U.K. and European Economic Area (EEA): Unless specified to the contrary, issued and approved for distribution in the U.K. and the EEA by
JPMSL. Investment research issued by JPMSL has been prepared in accordance with JPMSL's policies for managing conflicts of interest arising
as a result of publication and distribution of investment research. Many European regulators require a firm to establish, implement and maintain
such a policy. This report has been issued in the U.K. only to persons of a kind described in Article 19 (5), 38, 47 and 49 of the Financial Services
and Markets Act 2000 (Financial Promotion) Order 2005 (all such persons being referred to as "relevant persons"). This document must not be
acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this document relates is only
available to relevant persons and will be engaged in only with relevant persons. In other EEA countries, the report has been issued to persons
regarded as professional investors (or equivalent) in their home jurisdiction. Australia: This material is issued and distributed by JPMSAL in
Australia to “wholesale clients” only. JPMSAL does not issue or distribute this material to “retail clients.” The recipient of this material must not
distribute it to any third party or outside Australia without the prior written consent of JPMSAL. For the purposes of this paragraph the terms
“wholesale client” and “retail client” have the meanings given to them in section 761G of the Corporations Act 2001. Germany: This material is
distributed in Germany by J.P. Morgan Securities Ltd., Frankfurt Branch and J.P.Morgan Chase Bank, N.A., Frankfurt Branch which are
regulated by the Bundesanstalt für Finanzdienstleistungsaufsicht. Hong Kong: The 1% ownership disclosure as of the previous month end
satisfies 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. (For research published within the first ten days of the month, the disclosure may be based on the month end data from
two months’ prior.) J.P. Morgan Broking (Hong Kong) Limited is the liquidity provider for derivative warrants issued by J.P. Morgan Structured
Products B.V. and listed on the Stock Exchange of Hong Kong Limited. An updated list can be found on HKEx website:
http://www.hkex.com.hk/prod/dw/Lp.htm. Japan: There is a risk that a loss may occur due to a change in the price of the shares in the case of
share trading, and that a loss may occur due to the exchange rate in the case of foreign share trading. In the case of share trading, JPMorgan
Securities Japan Co., Ltd., will be receiving a brokerage fee and consumption tax (shouhizei) calculated by multiplying the executed price by the
commission rate which was individually agreed between JPMorgan Securities Japan Co., Ltd., and the customer in advance. Financial Instruments
Firms: JPMorgan Securities Japan Co., Ltd., Kanto Local Finance Bureau (kinsho) No. 82 Participating Association / Japan Securities Dealers
Association, The Financial Futures Association of Japan. Korea: This report may have been edited or contributed to from time to time by
affiliates of J.P. Morgan Securities (Far East) Ltd, Seoul Branch. Singapore: JPMSS and/or its affiliates may have a holding in any of the
securities discussed in this report; for securities where the holding is 1% or greater, the specific holding is disclosed in the Important Disclosures
section above. India: For private circulation only, not for sale. Pakistan: For private circulation only, not for sale. New Zealand: This
material is issued and distributed by JPMSAL in New Zealand only to persons whose principal business is the investment of money or who, in the
course of and for the purposes of their business, habitually invest money. JPMSAL does not issue or distribute this material to members of "the


                                                                                                                                                     7
Seshadri K Sen, CFA                            Asia Pacific Equity Research
(91-22) 6157-3575                              30 November 2010
seshadri.k.sen@jpmorgan.com




public" as determined in accordance with section 3 of the Securities Act 1978. The recipient of this material must not distribute it to any third
party or outside New Zealand without the prior written consent of JPMSAL. Canada: The information contained herein is not, and under no
circumstances is to be construed as, a prospectus, an advertisement, a public offering, an offer to sell securities described herein, or solicitation of
an offer to buy securities described herein, in Canada or any province or territory thereof. Any offer or sale of the securities described herein in
Canada will be made only under an exemption from the requirements to file a prospectus with the relevant Canadian securities regulators and only
by a dealer properly registered under applicable securities laws or, alternatively, pursuant to an exemption from the dealer registration requirement
in the relevant province or territory of Canada in which such offer or sale is made. The information contained herein is under no circumstances to
be construed as investment advice in any province or territory of Canada and is not tailored to the needs of the recipient. To the extent that the
information contained herein references securities of an issuer incorporated, formed or created under the laws of Canada or a province or territory
of Canada, any trades in such securities must be conducted through a dealer registered in Canada. No securities commission or similar regulatory
authority in Canada has reviewed or in any way passed judgment upon these materials, the information contained herein or the merits of the
securities described herein, and any representation to the contrary is an offence. Dubai: This report has been issued to persons regarded as
professional clients as defined under the DFSA rules.
General: Additional information is available upon request. Information has been obtained from sources believed to be reliable but JPMorgan
Chase & Co. or its affiliates and/or subsidiaries (collectively J.P. Morgan) do not warrant its completeness or accuracy except with respect to any
disclosures relative to JPMS and/or its affiliates and the analyst’s involvement with the issuer that is the subject of the research. All pricing is as
of the close of market for the securities discussed, unless otherwise stated. Opinions and estimates constitute our judgment as of the date of this
material and are subject to change without notice. Past performance is not indicative of future results. This material is not intended as an offer or
solicitation for the purchase or sale of any financial instrument. The opinions and recommendations herein do not take into account individual
client circumstances, objectives, or needs and are not intended as recommendations of particular securities, financial instruments or strategies to
particular clients. The recipient of this report must make its own independent decisions regarding any securities or financial instruments
mentioned herein. JPMS distributes in the U.S. research published by non-U.S. affiliates and accepts responsibility for its contents. Periodic
updates may be provided on companies/industries based on company specific developments or announcements, market conditions or any other
publicly available information. Clients should contact analysts and execute transactions through a J.P. Morgan subsidiary or affiliate in their home
jurisdiction unless governing law permits otherwise.
“Other Disclosures” last revised September 1, 2010.

Copyright 2010 JPMorgan Chase & Co. All rights reserved. This report or any portion hereof may not be reprinted, sold or
redistributed without the written consent of J.P. Morgan.#$J&098$#*P




8

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:2
posted:5/1/2012
language:
pages:8