Morgan stanley -ASEAN Equity Strategy

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					                                                             MORGAN                STANLEY                 RESEARCH
                                                             ASIA/PACIFIC


                                                             Morgan Stanley Asia (Singapore)          Hozefa Topiwalla
                                                             Pte.+
                                                                                                      Hozefa.Topiwalla@morganstanley.com
                                                                                                      +65 6834 6439

                                                                                                      Aarti P Shah
                                                                                                      Aarti.Shah@morganstanley.com
                                                                                                      +65 6834 6741


May 4, 2013


ASEAN Equity Strategy
Pick Quality Names in Indo
                                                             Morgan Stanley Sector Model for May-2013
                                                                                      Long/Short Sector Strategy
Continue to Prefer Indonesia over Thailand over                                                                                         MSCI
                                                               Position         MSCI Indonesia MSCI Thailand
Singapore: We have around 9.0% and 6.0% upside to                                                                                     Singapore
Indonesia and Thai markets respectively, and 0.5%                             Financials & Health Materials &
                                                                  OW                                                                 Real Estate
                                                                                     Care           Energy
downside to Singapore. We like Indo and Thai markets
                                                                                   Energy &
for Investment led growth combined with Oligopolistic             UW              Consumer
                                                                                                  Health Care &                       Diversified
growth companies.                                                                                    utilities                        Financials
                                                                                 Discretionary
                                                             Source: Morgan Stanley Research
Recent correction a good opportunity (Recommend
Bank Mandiri, Kalbe Farma and Unilever Indonesia):           Morgan Stanley Top 5 Focus Stocks
Our Indo portfolio continues to be skewed in favour of          Five Key Focus Stocks      GICS Sector
                                                                                                           Mkt Cap     Latest     Target    Target Price
                                                                                                          (USD mn)     Price      Price       Upside
domestically oriented sectors/companies. We are OW
                                                             Bank Mandiri                    Financials      24,080      9,800     10,768      9.9%
Indonesia Financials, Healthcare, UW Energy, and             Kalbe Farma                    Health Care       7,040      1,330      1,480      11.3%
Consumer Discretionary (replacing Industrials with           PTT Public Company                Energy        31,737        326        409      25.5%
                                                             PTT Global Chemicals             Materials      11,069         70         83      18.1%
Consumer Discretionary). We are replacing Summercon          Suntec REIT                     Financials       3,513          2          2      12.0%
Agung with Ciputra Development. We continue to be            Source: Thomson Reuters, Morgan Stanley Research
positive on the Indo property sector and Sumercon
Agung. However, Ciputra Development is our analysts
Sean Gardiner’s top pick in the sector with 19% upside.
MS Indonesia Focus List outperformed MSCI Indonesia
by around 1800 bps since inception.

We remained Positioned for Global recovery
through Thai stocks: MS Thai portfolio is positioned for
potential H2C13 improvement in global growth with OW
on Materials and Energy sectors. Attractive valuations
and supportive dividend yields also work in favor of
these sectors. We are UW defensive and richly valued
sectors i.e. Utilities and Healthcare. Our Thai Focus List
has outperformed MSCI Thailand by around 650 bps
since inception.

Tilting the Balance Slightly back to Defensive
Dividend Strategy in Singapore: Potential soft global
growth patch has prompted us to add Suntec REITs
                                                             Morgan Stanley does and seeks to do business with
(replacing First Resources) to our defensive dividend        companies covered in Morgan Stanley Research. As
yield strategy in Singapore, which currently includes        a result, investors should be aware that the firm may
Sing Tel and Keppel Corp. We continue to be positioned       have a conflict of interest that could affect the
for a potential H2 global growth recovery with Noble and     objectivity of Morgan Stanley Research. Investors
                                                             should consider Morgan Stanley Research as only a
SIA. Our Singapore Focus List has underperformed
                                                             single factor in making their investment decision.
MSCI Singapore by around 1550 bps since inception.
MS April 2013 Sector Model has yielded +8.4%, -1.2%
                                                             For analyst certification and other important
                                                             disclosures, refer to the Disclosure Section,
and 3.4% in Indonesia, Thailand and Singapore,               located at the end of this report.
respectively.                                                += Analysts employed by non-U.S. affiliates are not registered with FINRA, may not be
                                                             associated persons of the member and may not be subject to NASD/NYSE restrictions on
                                                             communications with a subject company, public appearances and trading securities held by a
                                                             research analyst account.
                                           MORGAN        STANLEY     RESEARCH

                                           May 4, 2013                                                       MORGAN STANLEY RESEARCH
                                           ASEAN Equity Strategy                                                                     May 3, 2013
                                                                                                                            ASEAN Equity Strategy



Overweight Sector Recommendations
                                             Indonesia Financials sector continues to rank No. 1 in our Quant + Qualitative model. We remain
                            INDONESIA        positive on Indonesian banks for their structural growth, supported by potentially rising rates and
                                             investment-led growth. In addition, the sector’s high ROE and strong compounding book value make
                            FINANCIALS       the sector attractive. We expect large banks with strong deposit franchises to benefit from higher
                             (+200 bps)      rates. Our preferred stocks are Bank Mandiri and Bank Rakyat.


                                             Indonesia Health Care ranks as the No. 2 sector on our overall Quant + Qualitative Model.
                                             Indonesia’s per capita drug expenditure is only US$15 — less than half the regional average of $33
                             INDONESIA       representing a significant growth opportunity. With increasing demand for quality healthcare among
                                             an expanding middle class, overall spend on pharmaceuticals is likely to rise. Indonesia’s health
                              Healthcare     spending, on average, is only about 2.5% of GDP, well below its peers. A new healthcare law
                              (+100 bps)     proposed up to a doubling of the government’s healthcare expenditure, up to 5% of GDP. This, if
                                             committed, could catalyze pharmaceutical industry growth to high teens over the next few years.
                                             Players with nation-wide distribution & local manufacturing facilities are best positioned.

                                             Thailand Materials sector ranks No. 1 in our Quant + Qualitative Model. We are playing the global
                                             cyclical recovery through petrochemical companies, though the cement companies look
     OW SECTORS




                              THAILAND
                                             expensive in Thailand. We believe Chinese demand has been steady for commodity
                               Materials     petrochemicals like PE/PP with margins holding above cash cost levels. Stocks remain below mid
                              (+200 bps)     cycle averages with good FCF yields. IRPC and PTT GC remain our preferred names



                                             Thailand Energy sector ranks amongst the top in our Quant + Qualitative Model. With increasing
                              THAILAND       government focus on decontrol of petroleum products and downside risks to domestic gas prices
                                             (which are already marked to US$110/bbl Brent oil) we believe PTT remains the best positioned
                                Energy       in Thailand’s energy space. Valuations remain undemanding from a regional context as well.
                              (+100 bps)


                                            Singapore Real Estate sector ranks No. 1 in our Quant + Qualitative Model. Abundant liquidity and
                            SINGAPORE       low interest rates continue to fuel the chase for yields, and we still see some 50bps of div yield
                                            compression to go for the Reits, which are still trading at a 400bps premium to the historical 10Y
                            Real Estate     government bond yield, vs. 350bps historically. Our top Reit Pick is Suntec Reit. Selected developers
                             (+200 bps)     with limited exposure to the local residential market also benefit from compressing cap rates. These
                                            include Capitaland, CMA, OUE, and GLP.


Source: Morgan Stanley Research




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                                             MORGAN        STANLEY      RESEARCH

                                             May 4, 2013                                                          MORGAN STANLEY RESEARCH
                                             ASEAN Equity Strategy                                                                        May 3, 2013
                                                                                                                                 ASEAN Equity Strategy



Underweight Sector Recommendations
                                             Indonesia Energy ranks lowest in our Quant + Qualitative Model.
                           INDONESIA         Consensus earnings continue to head lower. Energy C2013 consensus earnings have been revised
                                             down by 32.5% YTD, compared to MSCI Indonesia’s revision of only -0.9%. Indonesia Energy’s sector
                              Energy         ROE is 2327 bps below MSCI Indonesia and well below its -1 Standard Deviation from 3 year average
                            (-200 bps)       of 1291 bps discount to MSCI Indonesia.



                                              Indonesia Consumer Discretionary ranks amongst the lowest ranked sector in Indonesia at No.8
                        INDONESIA             on our Quant + Qualitative Model.
                                              Consumer Discretionary sector had the worst earnings breadth in Indonesia. Its earnings breadth
                   Consumer Discretionary     was -14.3% vs MSCI Indonesia’s -2.3%. Further, its 2013 earnings estimates were revised down
                         (-100 bps)           by 2.1% YTD, as compared to MSCI Indonesia’s 0.9%.
      UW SECTORS




                                             Thailand Health Care sector ranks second lowest in our Quant + Qualitative model.
                                             Thailand Health Care sector at 41.9x is at 172% premium to MSCI Thailand and close to +11 Standard
                           THAILAND          Deviation from the 3 year mean value. On a trailing PB basis also, the sector is expensive at 159%
                           Health Care       premium to MSCI Thailand.

                            (-200 bps)


                                             Thai Utilities ranks No. 8 in our Quant + Qualitative Model.
                             THAILAND        The sector appears relatively expensive amid weakening earnings outlook and momentum. Thailand
                                             Utilities trailing dividend yield is at a discount of 7 bps compared to MSCI Thailand i.e. below its -1 std
                               Utilities     dev value from 3 year’s mean of 2 bps premium. Its relative PE remains high at 31% premium to
                             (-100 bps)      MSCI Thailand compared to last 3-year average of only 26% premium. Similarly, it is trading at 19%
                                             PB premium compared to last 3-year average of 3% premium to MSCI Thailand.


                                             Singapore Diversified Financials ranks lowest in our Quant + Qualitative Model.
                          SINGAPORE          On a trailing PE basis, Singapore Diversified Financials, at 27.6x, is trading at 107% premium to MSCI
                                             Singapore, close to its +1 Standard Deviation from the 3 year average of 109%. Even on PB basis, the
                       Diversified Finance   sector is expensive, at 10.7x, 588% premium to MSCI Singapore , compared to its long term average
                           (-200 bps)        of 519%.



Source: Morgan Stanley Research




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                                                                 MORGAN         STANLEY      RESEARCH

                                                                 May 4, 2013                                                          MORGAN STANLEY RESEARCH
                                                                 ASEAN Equity Strategy                                                                        May 3, 2013
                                                                                                                                                     ASEAN Equity Strategy



Top 5 Focus Stocks
                        Bank Mandiri (BMRI.JK)                      Nick Lord’s View: Bank Mandiri to deliver the fastest YoY NPAT growth in 2013e within the
                                                                    industry, helped by margin expansion and we believe this is not in the price. In addition, we do not
                         (Rp9,800 PT Rp10,768                       think the market fully appreciates the improvements that Mandiri has made to its franchise. Its
                            Indonesia Financials                    funding costs have already shown the biggest improvement in the industry, and we now expect a
                               MS Rating: OW                        pickup in risk-adjusted asset yields, providing NIM support.



                        Kalbe Farma (KLBF.JK)                       Divya Gangahar Kothiyal’s View: Changes in KLBF’s marketing strategy in the past 12-18
                                                                    months are showing signs of driving revenue growth acceleration. Our recent meeting with
                         (Rp1,330, PT Rp1,480)                      management increases our conviction on the sustainability of this growth. Kalbe’s exposure to
                            Indonesia Health Care                   underpenetrated high-growth categories, unrivaled distribution reach and an expanding product
                               MS Rating: OW                        portfolio are its key attractions. Improvement in growth trajectory, cash flow generation and return
     Top 5                                                          ratios will support valuations, in our view.


                                                                   Mayank Maheshwari’s View: Largest beneficiary of any LPG/CNG decontrol in Thailand. With
    Focus                     PTT (PTT.BK)                         the government’s focus on starting LPG decontrol in 1H13, we see 10-12% leverage to 2014 EPS
                            (Bt326, PT Bt409)                      assuming the government is partially successful with its efforts. Also, with more downside risks to
                               Thailand Energy                     domestic gas prices, the pace of subsidy increase will reduce, assuming no decontrol. The stock
    Stocks                                                         trades at 7.3x 2013e P/E with 7.9% FCF yield, one of the cheapest integrated stocks in Asian oils.
                                MS Rating: EW


                         PTT Global Chemical                       Mayank Maheshwari’s View: Stabilizing/declining gas feedstock costs, coupled with improved
                             (PTTGC.BK)                            chemical demand/margins in 2013, supported by higher volumes & stronger balance sheet to
                           (Bt70, PT Bt83)                         drive outperformance. Also, PTTGC’s 6% increase in ethylene prices will increase EPS by ~5%
                                                                   and help contain the impact of higher profit sharing. The stock is discounting an oil price of
                             Thailand Materials                    US$83/bbl.
                              MS Rating: OW

                                                                   Wilson Ng’s View: New top pick in S-REITs. Suntec Reit’s outperforming office assets are well
                        Suntec REIT (SUNT.SI)                      appreciated by the market, but we think mall overhaul concerns are overdone. At current
                          (S$1.9, PT S$2.2)                        valuations the stock is pricing in 5% growth in Suntec mall rents post renovation, vs.
                                                                   management’s target of 25%. The strong pace of sign-ups for renewed space has been
                           Singapore Real Estate                   encouraging, and rentals secured are on track with management targets. Positive signs of
                              MS Rating: OW                        execution, with Phase 1 of 3 reopening in June, will help rerate the stock in our view.


Source: DataStream, Morgan Stanley Research. Price as of 02 May 2013 closing.




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                                                                      MORGAN        STANLEY        RESEARCH

                                                                      May 4, 2013                                                               MORGAN STANLEY RESEARCH
                                                                      ASEAN Equity Strategy                                                                                 May 3, 2013
                                                                                                                                                                   ASEAN Equity Strategy



 Morgan Stanley ASEAN 20 Focus List
                                                                                                      Target        C0213E                  MS PE
                                                GICS           Mkt Cap         Latest Target
  Company Name                  Rating                                                                 Price        Dividend                                           Analyst
                                               Sector         (USD mn)         Price Price                                          2013E 2014E
                                                                                                      Upside          Yield
                                                                                    INDONESIA
Bank Rakyat Indonesia          Overweight    Financials              23,452       8,900     9,668       8.6%           2.6%   e        11.5 e       10.5 e     Lord, Nick
Bank Mandiri                   Overweight    Financials              24,080       9,800    10,768       9.9%           2.4%   e        12.7 e       11.0 e     Lord, Nick
Semen Indonesia                Overweight    Materials               11,544      18,600    17,500       -5.9%          2.1%   e        19.5 e       18.1 e     Chong, Mean Phil
Ciputra Development            Overweight    Financials               2,103       1,340     1,593       18.9%          1.1%   e        27.7 e       18.6 e     Gardiner, Sean
Perusahaan Gas Negara          Overweight    Utilities               15,187       6,200     6,000       -3.2%          3.4%   e        17.4 e       16.5 e     Maheshwari, Mayank
Kalbe Farma                    Overweight    Health Care              7,040       1,330     1,480       11.3%          1.9%   e        30.9 e       26.4 e     Gangahar Kothiyal, Divya
Indosat                        Overweight    Telecommunic             3,265       5,550     8,000       44.1%          0.7%   e         4.6*         4.2*      Killa, Navin
Unilever Indonesia             Overweight    Consumer Stap           19,786      25,900    27,000       4.2%           2.6%   e        34.5 e       31.0 e     Gangahar Kothiyal, Divya
                                                                                     THAILAND
Bank of Ayudhya                Overweight    Financials               6,759           33       40       22.1%          3.4%   e        10.7     e    8.8   e   Goh, Edward
Kasikorn Bank Public Compan    Overweight    Financials              17,159         207       240       15.9%          2.1%   e        12.0     e    9.9   e   Goh, Edward
C P All                        Overweight    Consumer Stap           12,667           42       53       27.7%          2.9%   e        27.7     e   23.4   e   Gangahar Kothiyal, Divya
IRPC PCL                       Overweight    Energy                   2,791            4      4.9       21.9%          4.5%   e        10.9     e    9.2   e   Maheshwari, Mayank
PTT Global Chemicals           Overweight    Materials               11,069           70       83       18.1%          4.9%   e         9.2     e    9.8   e   Maheshwari, Mayank
PTT Public Company             Overweight    Energy                  31,737         326       409       25.5%          4.8%   e         7.3     e    7.6   e   Maheshwari, Mayank
                                                                                   SINGAPORE
Singapore Telecom              Overweight    Telecommunic             50,705           4      4.1       7.6%           4.7%   e        16.1 e       16.5 e     Killa, Navin
CapitaMalls Asia               Overweight    Financials                6,583           2      2.4       16.5%          1.6%   e        33.6 e       27.0 e     Gardiner, Sean
Singapore Airlines             Overweight    Industrials              10,778          11     13.5       22.5%          2.4%   e        16.1 e       15.0 e     Xu, Edward
Keppel Corporation             Overweight    Industrials              15,489          11     12.7       20.6%          4.2%   e        12.1 e       12.0 e     Ling, Xin Jin
Suntec REIT                    Overweight    Consumer Stap             2,160       1.92       2.2       12.0%          4.7%   e        34.9 e       27.9 e     Ng, Wilson
Noble Group                    Overweight    Industrials               6,086            1     1.6       41.6%          2.8%   e         9.0 e        6.9 e     Spencer, Charles

  Add Ciputra Development, Remove Summarecon Agung; Add Suntec REIT, Remove First Resources

  Source: Datastream, Morgan Stanley Research, closing price May 3,2013. For Indosat, EV/EBITDA multiple is taken as valuation reference.

  For valuation methodology and risks associated with any price targets above, except for our Top 5 Focus Stocks discussed herein, please email
  morganstanley.research@morganstanley.com with a request for valuation methodology and risks (VMR) on a particular stock. VMR for Top Five Focus Stocks also appear at the end
  of this report.




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                                                                            MORGAN         STANLEY         RESEARCH

                                                                            May 4, 2013                                                               MORGAN STANLEY RESEARCH
                                                                            ASEAN Equity Strategy                                                                                May 3, 2013
                                                                                                                                                                        ASEAN Equity Strategy



Morgan Stanley Five-Factor Sector Model – Overall Rankings and Scores
                                                      Profitability
                                    Valuations                         Earnings Momentum                             Price Performance
                                                      Momentum                                                                                        Total
                                                                                                   Earnings                                                          Qualitative    Final Sector
       MSCI Indonesia                                                    MoM            YTD                                                        Quantitative
                                            Div       Return on                                    Breadth        1Mth Price      12Mth Price                          Rank            Rank
                                   PER                                 Earnings       Earnings                                                        Rank
                                           Yield       Equity                                                    Performance      Performance
                                                                       Revision       Revision
           Weight                   5%      5%             5%               8%          10%          5%              8%               5%              50.0%            50.0%          100.0%
         Financials                  3       4              1                1           1            1               5                6                1                1               1
         Healthcare                  8       5              3                3           4            2               2                8                3                2               2
           Utilities                 4       7              5                5           2            2               4                9                4                3               3
 Telecommunication Services          5       9              4                2           5            5               3                5                5                4               4
          Materials                  7       8              2                4           3            2               1                7                2                7               5
         Industrials                 2       3              7                6           8            7               7                2                6                6               6
      Consumer Staples               6       6              8                8           6            8               6                4                9                5               7
  Consumer Discretionary             1       1              6                7           7            9               9                3                7                9               8
           Energy                    0       2              9                9           9            6               8                1                8                8               8
                                                            Profitability
                                        Valuations                           Earnings Momentum                            Price Performance
                                                            Momentum                                                                                     Total
                                                                                                      Earnings                                                        Qualitative    Final Sector
       MSCI Thailand                                                                        MoM                                                       Quantitative
                                                    Div      Return on        Earnings                Breadth        1Mth Price     12Mth Price                         Rank            Rank
                                  PER     P/B                                             Earnings                                                       Rank
                                                   Yield      Equity           Growth                               Performance     Performance
                                                                                          Revision
           Weight                 5%       7%        4%           5%             5%           5%          5%              8%             6%              50.0%           50%            100%
          Materials                2        2         2            7              5            6           3               8              3                3              1               1
           Energy                  1        1         1            9              8            8           4               5              1                1              3               1
   Consumer Discretionary          4        4         4            4              7            4           2               3              6                2              5               3
         Financials                3        7         5            3              6            5           4               6              5                6              2               4
         Industrials               7        8         6            1              9            1           1               1              9                5              6               5
      Consumer Staples             6        3         7            8              1            9           9               9              2                9              4               6
 Telecommunication Services        8        5         9            2              4            3           4               2              7                4              9               6
          Utilities                5        6         8            6              2            7           4               7              4                7              7               8
         Healthcare                9        9         3            5              3            2           4               4              8                8              8               9
                                                                   Profitability                                                   Price
                                           Valuations                                 Earnings Momentum
                                                                   Momentum                                                    Performance           Total
                                                                                                                 Earnings                                            Qualitative    Final Sector
       MSCI Singapore                                                                                 MoM                                         Quantitative
                                                           Div        Return on        Earnings                  Breadth        1Mth Price                             Rank            Rank
                                     PER        P/B                                                 Earnings                                         Rank
                                                          Yield        Equity           Growth                                 Performance
                                                                                                    Revision
           Weight                    11%        12%        10%           2%              3%           3%            3%              8%                50%               50%             100%
         Real Estate                  8          5          4             6               1            5             3               3                 5                 2                1
            Banks                     1          7          7             1               8            2             2               2                 4                 3                1
        Transportation                3          4          3             5               3            4             8               4                 3                 4                1
        Capital Goods                 2          3          1             3               4            6             7               8                 1                 6                1
   Consumer Discretionary             4          2          2             7               7            7             3               5                 2                 7                5
 Telecommunication Services           6          8          8             2               2            3             3               1                 8                 1                5
      Consumer Staples                7          1          5             8               6            8             3               7                 6                 5                7
     Diversified Finance              5          6          6             4               5            1             1               6                 7                 8                8

 Source: IBES, DataStream, Morgan Stanley Research
Note: Back testing is done only for Top and Bottom 2 sectors, respectively, for Indonesia and Thailand, and Top and Bottom sector for Singapore; hence, we ignore the other
sectors. Rank 1 is the most favored sector, whereas Ranks 7, 8 and 9 are least favored in Thailand & Singapore and Indonesia, respectively.


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                                                                                                                                                  MORGAN                         STANLEY        RESEARCH

                                                                                                                                                  May 4, 2013                                                                             MORGAN STANLEY RESEARCH
                                                                                                                                                  ASEAN Equity Strategy                                                                                            May 3, 2013
                                                                                                                                                                                                                                                          ASEAN Equity Strategy



OW Indonesia Financials (Rank 1): Strong Profitability and Earnings Momentum
                                                       Strong Profit Momentum                                                                                                                                Strong Earnings Momentum YTD
   100                                               Indonesia Financials                                                                                                                                    Earnings Momentum: 2013 Earnings YTD
    50                                       ROE Prem/Disc To MSCI Indonesia (bps)                                                                                                                              Revision for Indonesia Financials
     0                                                                                                                                                                                        10%
                                                                                                                                                                                                     4.4%
   -50                        +1 stdev                                                                                                                                                         5%             2.4%    2.1%    1.6%        0.6%
  -100                                                                                                                                                                                         0%
  -150                                                                                                                                                      Average                           -5%                                                 -1.4% -2.1%
                                                                                                                                                                                                                                                              -2.9%
  -200                                                                                                                                                                                        -10%
  -250                                                                                                                                                                                        -15%
  -300                                           -1 stdev                                                                                                                                     -20%
  -350                                                                                                                                                                                        -25%
  -400                                                                                                                                                                                        -30%
         Feb-10
                  Apr-10
                           Jun-10
                                    Aug-10
                                              Oct-10
                                                       Dec-10
                                                                Feb-11
                                                                         Apr-11
                                                                                  Jun-11
                                                                                           Aug-11
                                                                                                    Oct-11
                                                                                                             Dec-11
                                                                                                                      Feb-12
                                                                                                                               Apr-12
                                                                                                                                        Jun-12
                                                                                                                                                 Aug-12
                                                                                                                                                          Oct-12
                                                                                                                                                                   Dec-12
                                                                                                                                                                            Feb-13
                                                                                                                                                                                     Apr-13
                                                                                                                                                                                              -35%                                                                        -32.5%
                                                                                                                                                                                                     ID FN    ID UT   ID MA   ID HC       ID TS   ID CS   ID CD   ID IN   ID EN




 • Continues to Rank Top in Indonesia: The Indonesia Financials sector continues to rank No. 1 in our Quant +Qualitative Rank model. Its strong profitability
 momentum and earnings momentum YTD and MoM drives our OW rating on the sector.

 • Strong Profitability (RoE) and Earnings Momentum: MSCI Indonesia Financials sector’s relative profitability is improving, with its ROE being at 42 bps
 premium to MSCI Indonesia compared to a 3-year average discount of 181 bps. Further, the sector saw strong earnings momentum YTD and over last one month. Its
 C2013 earnings estimates were revised up by 4.4% compared to MSCI Indonesia downward revision of 0.9% YTD. Also, its earnings breadth was strong at 0.9% vs
 MSCI Indonesia’s -2.9%.

 • Analyst View: Our analyst, Nick Lord, remains positive on Indonesian banks for their structural growth, supported by potentially rising rates and investment-led
 growth. In addition, the sector’s high ROE and strong compounding book value make the sector attractive. He expects large banks with strong deposit franchises to
 benefit from higher rates. He believes Bank Mandiri and Bank Rakyat are best placed for the trends he expects this year




  Source: DataStream, IBES, Morgan Stanley Research




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                                                                   MORGAN        STANLEY     RESEARCH

                                                                   May 4, 2013                                                                                                                          MORGAN STANLEY RESEARCH
                                                                   ASEAN Equity Strategy                                                                                                                                                                    May 3, 2013
                                                                                                                                                                                                                                                   ASEAN Equity Strategy

OW Indonesia Healthcare (Rank 2): Improving Earnings Breadth and Relatively Strong
Profitability Momentum
               Strong Price Momentum Over Last 1 M                                                                           Relatively Strong Profit Momentum
                                                                                           500                                                        Indonesia Health Care
                  Price Momentum: Last One Month Performance
                             Indonesia Health Care                                         400                                                 ROE Prem/Disc To MSCI Indonesia (bps)
   12%
           10%                                                                             300
   10%              9%                                                                                     +1 stdev
                            7%                                                             200
    8%
                                    6%
                                                                                           100             Average
    6%                                       5%
                                                                                             0
    4%                                                 2%
    2%                                                        1%                           -100

    0%                                                                                     -200
                                                                                                                                                                                                                                                       -1 stdev
   -2%                                                                                     -300
   -4%                                                                                     -400
                                                                       -3%
   -6%                                                                                     -500
                                                                                -5%




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                                                                                                                                                                                                                                                                                      Jan-13
                                                                                                                                                                                                                                                                                               Mar-13
                                                                                                                                                                                                                                                                                                        May-13
   -8%
          ID MA   ID HC    ID TS   ID UT   ID FN      ID CS   ID IN   ID EN    ID CD




• Top 2 Ranked Sector in Indonesia: Indonesia Health Care ranks as the No. 2 sector on our overall Quant + Qualitative Model. Its strong price performance over last
one month, relatively strong profitability momentum and earnings breadth rive our OW recommendation on the sector.

• Strong Price Performance: Indonesia Healthcare was the second best performing sector over last one month. It returned 9% vs MSCI Indonesia 3% return during the
same period.

•Relatively Strong Profit Momentum: MSCI Indonesia Health Care sector’s relative profitability is improving, with its ROE being at 301 bps premium to MSCI
Indonesia compared to a 3-year average premium of 17 bps.

• Strong Earning Breadth: MSCI Indonesia Health Care ranked 2nd in earnings breadth. It reported flat breadth vs MSCI Indonesia's -2.9%.

• Analyst View: Changes in Kalbe’s marketing strategy in the past 12-18 months are showing signs of driving revenue growth acceleration. Our recent meeting with
management increases our conviction on the sustainability of this growth. Kalbe’s exposure to underpenetrated high-growth categories, unrivaled distribution reach and
an expanding product portfolio are its key attractions. Improvement in growth trajectory, cash flow generation and return ratios will support valuations.


  Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                8
                                                                                                                                                                         MORGAN                          STANLEY              RESEARCH

                                                                                                                                                                         May 4, 2013                                                                               MORGAN STANLEY RESEARCH
                                                                                                                                                                         ASEAN Equity Strategy                                                                                            May 3, 2013
                                                                                                                                                                                                                                                                                 ASEAN Equity Strategy



OW Thailand Materials (Rank 1): Attractive Valuations and Underperformance
                                               Relatively Attractive Valuations                                                                                                                                                        Last 12 Months Underperformance
50%                                                                         Thailand Materials                                                                                                                                   Price Performance During Last 12 Months for Thailand Materials
                                                                      PB Prem/Disc To MSCI Thailand                                                                                                                    160%
40%                                                                                                                                                                                                                            144%
                                                                                                                                                                                                                       140%
                +1 stdev
30%
                                                                                                                                                                                                                       120%
                                                                                                                                                                                                                       100%             93%
20%
                                                                                                                                                                               Average
                                                                                                                                                                                                                       80%
10%                                                                                                                                                                                                                                            55%
                                                                                                                                                                                                                       60%
                                                                                                                                                                                                                                                       36%
 0%                                                                                                                                                                                                                    40%                                         31%
                                                                                                                                                                                                                                                                         20%
                         -1 stdev                                                                                                                                                                                      20%                                                       12%     11%
-10%
                                                                                                                                                                                                                        0%
-20%
                                                                                                                                                                                                                       -20%                                                                       -7%
       Sep-09
                Nov-09
                         Jan-10
                                  Mar-10
                                           May-10
                                                    Jul-10
                                                             Sep-10
                                                                      Nov-10
                                                                               Jan-11
                                                                                        Mar-11
                                                                                                 May-11
                                                                                                          Jul-11
                                                                                                                   Sep-11
                                                                                                                            Nov-11
                                                                                                                                     Jan-12
                                                                                                                                              Mar-12
                                                                                                                                                       May-12
                                                                                                                                                                Jul-12
                                                                                                                                                                          Sep-12
                                                                                                                                                                                   Nov-12
                                                                                                                                                                                            Jan-13
                                                                                                                                                                                                     Mar-13
                                                                                                                                                                                                              May-13
                                                                                                                                                                                                                               TH IN   TH HC   TH TS   TH CD   TH FN     TH UT   TH MA   TH CS   TH EN




 • Top Sector in Thailand: Thailand Materials ranks 1 on our Quant + Qualitative Model on the back of relatively attractive valuations and good long term Price
 Momentum.

 • Relatively Attractive Valuations: On a Trailing PB basis, Thailand Material’s sector 2.4x is trading at 6% discount to MSCI Thailand as compared to its historical
 premium of 12% and is below its -1 Std Dev from 3 years mean value. On Trailing DY basis also, it is trading at 17 bps premium to MSCI Thailand as compared to its
 historical average of 3 bps discount.

 •Last 12 months underperformance: The sector has relatively more room for upside compared to other sectors with only 12% performance in the last 12 months
 compared to MSCI Thailand’s 19% during the same period. It has been the third lowest performing sector in last 12 months.

 • Analyst View: We are playing the global cyclical recovery through petrochemical companies in Thailand. We have seen some recent improvement in petrochemical
 demand from China. Utilization rates and margins have held up above cash costs. Our preferred stocks are IRPC and PTT GC.




  Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                                               9
                                                                                                                                                        MORGAN                        STANLEY             RESEARCH

                                                                                                                                                        May 4, 2013                                                                                 MORGAN STANLEY RESEARCH
                                                                                                                                                        ASEAN Equity Strategy                                                                                              May 3, 2013
                                                                                                                                                                                                                                                                  ASEAN Equity Strategy



  OW Thailand Energy (Rank 1): Attractive Valuations and Underperformance
                                                                       PER at -1Std Dev                                                                                                                       Strong Price Momentum over last 12 Months
  80%                                                                       Thailand Energy                                                                                                                            Price Performance In Last 12 Months: Thailand Energy
                                                                   PE Prem/Discount To MSCI Thailand                                                                                                   130%   119%
  60%
                                                                                                                                                                                                       110%           97%
  40%                                                                                                                                                                                                  90%

                                                                                                                                                                                                       70%
+120%
   stdev
                                                                                                                                                                                                       50%
   0%                                                                                                                                                                                                                         36%     33%          33%   31%
                                                                                                                                                                  Average                                                                                        25%
                                                                                                                                                                                                       30%
 -20%                                                                                                                                                                                                                                                                     8%
                     -1 stdev                                                                                                                                                                          10%

 -40%                                                                                                                                                                                                  -10%
        Jan-10

                 Mar-10

                          May-10

                                   Jul-10

                                            Sep-10

                                                     Nov-10

                                                              Jan-11

                                                                       Mar-11

                                                                                May-11

                                                                                         Jul-11

                                                                                                  Sep-11

                                                                                                           Nov-11

                                                                                                                    Jan-12

                                                                                                                             Mar-12

                                                                                                                                      May-12

                                                                                                                                               Jul-12

                                                                                                                                                         Sep-12

                                                                                                                                                                   Nov-12

                                                                                                                                                                            Jan-13

                                                                                                                                                                                     Mar-13

                                                                                                                                                                                              May-13
                                                                                                                                                                                                                                                                                 -12%
                                                                                                                                                                                                       -30%
                                                                                                                                                                                                              TH IN   TH HC   TH TS   TH UT    TH FN     TH CD   TH CS   TH MA   TH EN


  • Top 2 ranked sector in Thailand: Thailand Energy ranks amongst the top 1 sector in our Quant + Qualitative Model. We are OW the sector for its attractive
  valuations and strong long term price momentum.

  • Attractive Valuations: On a trailing PE basis, the sector at 10.5x is trading at 32% discount to MSCI Thailand i.e close to -1 Std Dev from the 3 year average. Even
  on a trailing PB basis, the sector looks cheap at 1.5x, 39% discount to MSCI Thailand and much below its -1Std Dev from the 3 year mean value of 25%. On a trailing
  dividend yield basis, the sector is trading at 105 bps premium to MSCI Thailand, much higher than +1 Std Dev value from 3 year average.

  • Trailing Underperformance: Thailand Energy is the only sector in MSCI Thailand with negative returns over the past 12 months. Its performance has been -12% vs
  MSCI Thailand 19% return over the same period.

  • Analyst View: With increasing government focus on decontrol of petroleum products and downside risks to domestic gas prices (which are already marked to
  US$110/bbl Brent oil), we believe PTT remains the best positioned in Thailand’s energy space. Valuations remain undemanding from a regional context as well.




    Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                              10
                                                                                                                                                MORGAN                         STANLEY        RESEARCH

                                                                                                                                                May 4, 2013                                                                       MORGAN STANLEY RESEARCH
                                                                                                                                                ASEAN Equity Strategy                                                                                 May 3, 2013
                                                                                                                                                                                                                                             ASEAN Equity Strategy

OW Singapore Real Estate (Rank 1): Strong Earnings Momentum and Short Term Price
Momentum
                                               Strong Earnings Momentum                                                                                                                                 Strong Short Term Price Momentum
12%                                                              Singapore Real Estate                                                                                                                  Price Performance In Last One Month: Singapore
                                                             12-month Forward EPS Growth                                                                                                                                 Real Estate
10%
                                                                                                                                                                                            12%
8%                      +1 stdev                                                                                                                                                                  10%
                                                                                                                                                                                            10%
6%
                                                                                                                                                                                            8%
4%                                                                                                                                                     Average                                             6%      5%
                                                                                                                                                                                            6%
2%
                                                                                                                                                                                            4%
0%                                                                                                                                                                                                                         1%
                                                                                                                                                                                            2%                                     1%
-2%                                                                                                                                                    -1 stdev                             0%
-4%                                                                                                                                                                                         -2%
                                                                                                                                                                                                                                          -2%
-6%                                                                                                                                                                                         -4%
      Mar-10

               May-10

                         Jul-10

                                  Sep-10

                                           Nov-10

                                                    Jan-11

                                                             Mar-11

                                                                      May-11

                                                                               Jul-11

                                                                                        Sep-11

                                                                                                 Nov-11

                                                                                                          Jan-12

                                                                                                                   Mar-12

                                                                                                                            May-12

                                                                                                                                     Jul-12

                                                                                                                                              Sep-12

                                                                                                                                                        Nov-12

                                                                                                                                                                 Jan-13

                                                                                                                                                                          Mar-13

                                                                                                                                                                                   May-13
                                                                                                                                                                                            -6%                                                    -5%     -5%
                                                                                                                                                                                                  SG TS   SG BK   SG RE   SG TR   SG CD   SG DF   SG CS   SG CG


• Top-Ranked Sector in Singapore: Singapore Real Estate sector ranks amongst the Top 1 in our Quant + Qualitative model. Its strong earnings momentum and short
term price momentum drive our OW recommendation.

• Strong Earnings Momentum: Singapore Real Estate sector 12M Fwd earnings growth is at strong 9% vs MSCI Singapore 4% earnings growth. This is higher than
its 3 year average growth of 7%.

• Short Term Price Momentum: Singapore Real Estate is amongst the top 3 best performing sector over the last one month. It returned 5% vs MSCI Singapore 2.9%
over the same period.

• Analyst View: Abundant liquidity and low interest rates continue to fuel the chase for yields, and we still see some 50bps of div yield compression to go for the Reits,
which are still trading at a 400bps premium to the historical 10Y government bond yield, vs. 350bps historically. Our top Reit Pick is Suntec Reit. Selected developers
with limited exposure to the local residential market also benefit from compressing cap rates. These include Capitaland, CMA, OUE, and GLP.




 Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                            11
                                                                  MORGAN        STANLEY        RESEARCH

                                                                  May 4, 2013                                                                                                                             MORGAN STANLEY RESEARCH
                                                                  ASEAN Equity Strategy                                                                                                                                                                       May 3, 2013
                                                                                                                                                                                                                                                     ASEAN Equity Strategy



UW Indonesia Energy (Rank 8): Weak Earnings and Profitability Momentum
                     Worst on Earnings Revisions                                                                                        Poor Profitability Momentum
                  Earnings Momentum: 2013 Earnings YTD                                    1,500                                         Profitability Momentum :Indonesia Energy
                       Revision for Indonesia Energy                                      1,000                                          ROE Prem/Disc To MSCI Indonesia (bps)
  10%                                                                                                                                  +1 stdev
         4.4%                                                                               500
   5%              2.4%    2.1%    1.6%    0.6%
                                                                                              0
   0%                                                                                                                                                    Average
  -5%                                              -1.4% -2.1%                             -500
                                                               -2.9%
 -10%                                                                                     -1,000
 -15%
                                                                                          -1,500                                                                                                                                                        -1 stdev
 -20%
                                                                                          -2,000
 -25%
 -30%                                                                                     -2,500




                                                                                                   Sep-09
                                                                                                            Nov-09
                                                                                                                     Jan-10
                                                                                                                              Mar-10
                                                                                                                                       May-10
                                                                                                                                                Jul-10
                                                                                                                                                         Sep-10
                                                                                                                                                                  Nov-10
                                                                                                                                                                           Jan-11
                                                                                                                                                                                    Mar-11
                                                                                                                                                                                             May-11
                                                                                                                                                                                                      Jul-11
                                                                                                                                                                                                               Sep-11
                                                                                                                                                                                                                        Nov-11
                                                                                                                                                                                                                                 Jan-12
                                                                                                                                                                                                                                          Mar-12
                                                                                                                                                                                                                                                   May-12
                                                                                                                                                                                                                                                            Jul-12
                                                                                                                                                                                                                                                                     Sep-12
                                                                                                                                                                                                                                                                              Nov-12
                                                                                                                                                                                                                                                                                       Jan-13
                                                                                                                                                                                                                                                                                                Mar-13
                                                                                                                                                                                                                                                                                                         May-13
 -35%                                                                         -32.5%
          ID FN    ID UT   ID MA   ID HC   ID TS      ID CS   ID CD   ID IN   ID EN




• Lowest Ranked Sector in Indonesia: Indonesia Energy ranks lowest in our Quant + Qualitative Model. The sector is experiencing weak earnings, profit and price
momentum.

• Worst Earnings Revision: Energy C2013 consensus earnings have been revised down by 32.5% YTD, compared to MSCI Indonesia’s revision of only -0.9%.

• Poor Profitability Momentum: Indonesia Energy’s sector ROE is 2327 bps below MSCI Indonesia and well below its -1 Standard Deviation from 3 year average
of 1291 bps discount to MSCI Indonesia.

• Poor Price Momentum : Last month, the sector was the second worst performing sector in Indonesia with 3% underperformance as compared to MSCI
Indonesia.




 Source: DataStream, IBES , Morgan Stanley Research




                                                                                                                                                                                               12
                                                               MORGAN         STANLEY    RESEARCH

                                                               May 4, 2013                                                        MORGAN STANLEY RESEARCH
                                                               ASEAN Equity Strategy                                                                    May 3, 2013
                                                                                                                                               ASEAN Equity Strategy

UW Indonesia Consumer Discretionary (Rank 8): Poor Earnings Breadth and Short
Term Price Momentum
                         Poor Earnings Breadth                                                       Poor Short term Price Momentum
  18.0%      C2013 Earnings Breadth: Indonesia Consumer                                                   Indonesia Consumer Discretionary
                                                                                             10%         Price Performance During Last Month
  14.0%                     Discretionary                                              10%            9%
                                                                                                              7%
  10.0%                                                                                8%
                                                                                                                      6%
                                                                                       6%                                     5%
   6.0%
           0.9%                                                                        4%
                                                                                                                                      2%
   2.0%             0.0%    0.0%    0.0%
                                                                                       2%                                                    1%
  -2.0%                                                                                0%
                                           -1.7%
  -6.0%                                               -2.9% -3.0%
                                                                                       -2%

 -10.0%                                                             -7.8%              -4%                                                           -3%
 -14.0%                                                                                -6%
                                                                                                                                                             -5%
                                                                            -14.3%     -8%
 -18.0%
                                                                                             ID MA   ID HC   ID TS   ID UT   ID FN   ID CS   ID IN   ID EN   ID CD
           ID FN ID HC ID HC ID HC ID TS ID EN ID IN ID CS ID CD



• Lowest-Ranked Sector in Indonesia: Indonesia Consumer Discretionary ranks amongst the lowest ranked sector in Indonesia at No.8 on our Quant +
Qualitative Model. Its weak earnings momentum, short term price momentum and poor earnings breadth drives our UW rating on the sector.

• Poor Earnings Breadth: Consumer Discretionary sector had the worst earnings breadth in Indonesia. Its earnings breadth was -14.3% vs MSCI Indonesia’s -
2.3%. Further, its 2013 earnings estimates were revised down by 2.1% YTD, as compared to MSCI Indonesia’s 0.9%.

• Poor Price Momentum: Indonesia Consumer Discretionary was the worst performing sector over the last 1 month with -5% return as compared to +3% return
of MSCI Indonesia during the same period.




 Source: DataStream, IBES , Morgan Stanley Research




                                                                                                                             13
                                                                                                                                                       MORGAN                       STANLEY         RESEARCH

                                                                                                                                                       May 4, 2013                                                                        MORGAN STANLEY RESEARCH
                                                                                                                                                       ASEAN Equity Strategy                                                                                    May 3, 2013
                                                                                                                                                                                                                                                       ASEAN Equity Strategy



 UW Thailand Health Care (Rank 9): Unattractive Valuations and Outperformance
                                                   Unattractive Valuations                                                                                                                                   Outperformance in last 12 Months
                                                                  Valuation: Thailand Health Care                                                                                            130%    119%    Price Performance In Last 12 Months for Thailand Health Care
                                                                PE Prem/Discount To MSCI Thailand
                                                                                                                                                                                             110%
                                                                                                                                                                                                              97%
              +1 stdev                                                                                                                                                                       90%
 180%

                                                                                                                                                                                             70%
 130%                                                                                                                                                            Average
                                                                                                                                                                                             50%
                                                                                                                                                                                                                      36%    33%      33%     31%
  80%                                                                                                                                                                                                                                                 25%
                                                                                                                                                                                             30%
                                                                                                                                                                                                                                                               8%
                                                           -1 stdev                                                                                                                          10%
  30%

                                                                                                                                                                                             -10%
 -20%                                                                                                                                                                                                                                                                 -12%
                                                                                                                                                                                             -30%
     Jan-10

              Mar-10

                       May-10

                                Jul-10

                                         Sep-10

                                                  Nov-10

                                                             Jan-11

                                                                      Mar-11

                                                                               May-11

                                                                                        Jul-11

                                                                                                 Sep-11

                                                                                                          Nov-11

                                                                                                                   Jan-12

                                                                                                                            Mar-12

                                                                                                                                     May-12

                                                                                                                                              Jul-12

                                                                                                                                                        Sep-12

                                                                                                                                                                  Nov-12

                                                                                                                                                                           Jan-13

                                                                                                                                                                                    Mar-13
                                                                                                                                                                                                     TH IN   TH HC   TH TS   TH UT    TH FN   TH CD   TH CS   TH MA   TH EN




• Lowest Ranked Sector in Thailand: Thailand Health Care ranks 9 in our Quant + Qualitative model. Unattractive Valuations and outperformance over the last 12
months drive this UW rating.

• Unattractive Valuations: Thailand Health Care sector at 41.9x is at 172% premium to MSCI Thailand and close to +11 Standard Deviation from the 3 year mean
value. On a trailing PB basis also, the sector is expensive at 159% premium to MSCI Thailand.

• Long Term Price Momentum: Thailand Health Care sector has been the second best performing sector over the last 12 months, outperforming MSCI Thailand by
97%.




  Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                     14
                                                                                                                                                         MORGAN                          STANLEY          RESEARCH

                                                                                                                                                         May 4, 2013                                                                                 MORGAN STANLEY RESEARCH
                                                                                                                                                         ASEAN Equity Strategy                                                                                            May 3, 2013
                                                                                                                                                                                                                                                                 ASEAN Equity Strategy



 UW Thailand Utilities (Rank 8): Unattractive Valuations and Poor Price Momentum
                                                           Unattractive Relative DY                                                                                                                             Poor Price Momentum over Last 1 Month
350                                                               Thailand Utilities                                                                                                                                  Price Momenetum: Performance During Last Month for Thailand
300                                               Dividend Yield Prem/Disc To MSCI Thailand (bps)                                                                                                                                              Utilities
                                                                                                                                                                                                        25%
250
                                                                                                                                                                                                              19.7%
200                                                                                                                                                                                                     20%
                                                                                                                                                                  +1 stdev
150
                                                                                                                                                                                                                        14.8%
100                                                                                                                                                           Average                                   15%

 50
                                                                                                                                                                                                        10%
  0
                                                                                                                                                   -1 stdev                                                                     4.6%    4.5%
 -50                                                                                                                                                                                                    5%
                                                                                                                                                                                                                                                 2.4%    2.1%    1.9%    1.5%    1.4%
-100
                                                                                                                                                                                                        0%
   Jan-10

            M ar-10

                      M ay-10

                                Jul-10

                                         Sep-10

                                                  Nov-10

                                                           Jan-11

                                                                    M ar-11

                                                                              M ay-11

                                                                                        Jul-11

                                                                                                 Sep-11

                                                                                                          Nov-11

                                                                                                                   Jan-12

                                                                                                                            M ar-12

                                                                                                                                      M ay-12

                                                                                                                                                Jul-12

                                                                                                                                                         Sep-12

                                                                                                                                                                  Nov-12

                                                                                                                                                                           Jan-13

                                                                                                                                                                                    M ar-13

                                                                                                                                                                                              M ay-13
                                                                                                                                                                                                              TH IN     TH TS   TH CD   TH HC    TH EN   TH FN   TH UT   TH MA   TH CS




• Second Lowest-Ranked Sector in Thailand: Thailand Utilities ranks No. 8 on our Quant + Qualitative Model. Its unattractive valuations and poor price momentum
continues to be a reason for our UW rating.

• Unattractive Valuation: Thailand Utilities trailing dividend yield is at a discount of 7 bps compared to MSCI Thailand i.e. below its -1 std dev value from 3 year’s
mean of 2 bps premium. Its relative PE remains high at 31% premium to MSCI Thailand compared to last 3-year average of only 26% premium. Similarly, it is trading
at 19% PB premium compared to last 3-year average of 3% premium to MSCI Thailand.

• Poor Price Performance: Over the last 1 month, Thailand Utilities has been amongst the worst performing sector in MSCI Thailand. It returned 1.9% over last 1
month compared to MSCI Thailand 3.5% return over the same period.




   Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                                15
                                                                                                                      MORGAN                    STANLEY    RESEARCH

                                                                                                                      May 4, 2013                                                                                                     MORGAN STANLEY RESEARCH
                                                                                                                      ASEAN Equity Strategy                                                                                                                                 May 3, 2013
                                                                                                                                                                                                                                                                   ASEAN Equity Strategy

UW Singapore Diversified Finance (Rank 8): Unattractive Valuations and Poor Price
Performance
                               PE Above +1 Standard Deviation                                                                                                                  PB Above +1 Standard Deviation
140%                                          Singapore Diversified Financials                                                                      700%                                         Singapore Diversified Financials
130%                                        PE Prem/Discount To MSCI Singapore                                                                                                                   PB Prem/Disc To MSCI Singapore
                                                                                                                                                    650%
120%
    +1 stdev
110%                                                                                                                                                600%            +1 stdev

100%
                                                                                                                                                    550%
                         Average                                                                                                                                                                  Average
 90%
 80%                                                                                                                                                500%
                                                                                                                                   -1 stdev
 70%                                                                                                                                                450%
                                                                                                                                                                                                                                                                 -1 stdev
 60%
                                                                                                                                                    400%
 50%
 40%                                                                                                                                                350%
       Sep-09

                Dec-09

                          Mar-10

                                   Jun-10

                                             Sep-10

                                                      Dec-10

                                                               Mar-11

                                                                        Jun-11

                                                                                 Sep-11

                                                                                          Dec-11

                                                                                                   Mar-12

                                                                                                            Jun-12

                                                                                                                     Sep-12

                                                                                                                              Dec-12

                                                                                                                                       Mar-13




                                                                                                                                                           Sep-09

                                                                                                                                                                      Dec-09

                                                                                                                                                                               Mar-10

                                                                                                                                                                                        Jun-10

                                                                                                                                                                                                  Sep-10

                                                                                                                                                                                                           Dec-10

                                                                                                                                                                                                                    Mar-11

                                                                                                                                                                                                                             Jun-11

                                                                                                                                                                                                                                      Sep-11

                                                                                                                                                                                                                                               Dec-11

                                                                                                                                                                                                                                                        Mar-12

                                                                                                                                                                                                                                                                  Jun-12

                                                                                                                                                                                                                                                                           Sep-12

                                                                                                                                                                                                                                                                                    Dec-12

                                                                                                                                                                                                                                                                                             Mar-13
• Lowest-Ranked Sector in Singapore: Singapore Diversified Financials rank No. 8 on our Quant + Qualitative Model. Rich Valuations and Poor short-term price
momentum drives our UW rating.

•Rich Valuations: On a trailing PE basis, Singapore Diversified Financials, at 27.6x, is trading at 107% premium to MSCI Singapore, close to its +1 Standard
Deviation from the 3 year average of 109%. Even on PB basis, the sector is expensive, at 10.7x, 588% premium to MSCI Singapore, compared to its long term
average of 519%.

• Poor Price Momentum: Singapore Diversified Financials has been amongst the worst performing sector over last one month. It returned -2% as compared to MSCI
Singapore’s +2% over last one month.




 Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                              16
                                                                    MORGAN        STANLEY            RESEARCH

                                                                    May 4, 2013                                                        MORGAN STANLEY RESEARCH
                                                                    ASEAN Equity Strategy                                                                      May 3, 2013
                                                                                                                                                      ASEAN Equity Strategy



Top 5 Focus Stocks

                                                             Mkt Cap (USD      Latest       Target    Target Price C0213E           MS PE
  Five Key Focus Stocks          Rating      GICS Sector                                                                                                    Analyst
                                                                  mn)          Price         Price      Upside Dividend Yield
                                                                                                                                2013E   2014E
Bank Mandiri                   Overweight      Financials             24,080    9,800       10,768      9.9%        2.4% e       12.7 e  11.0 e Lord, Nick
Kalbe Farma                    Overweight     Health Care              7,040    1,330        1,480      11.3%       1.9% e       30.9 e  26.4 e Gangahar Kothiyal, Divya
PTT Public Company             Overweight       Energy                31,737      326          409      25.5%       4.8% e        7.3 e   7.6 e Maheshwari, Mayank
PTT Global Chemicals           Overweight      Materials              11,069       70           83      18.1%       4.9% e        9.2 e   9.8 e Maheshwari, Mayank
Suntec REIT                    Overweight      Financials              3,513        2            2      12.0%       4.7% e       34.9 e  27.9 e Ng, Wilson

 We select our analysts’ most preferred stocks from each of the top five sectors for the month to arrive at our Top 5 picks for the month.

 PT Bank Mandiri – We expect Bank Mandiri to deliver the fastest 2-year NPAT growth in the industry, helped by margin expansion and we believe this is not in the
 price. In addition, we do not think the market fully appreciates the improvements that Mandiri has made to its franchise. Its funding costs have already shown the
 biggest improvement in the industry, and we now expect a pickup in risk-adjusted asset yields, providing NIM support. Our price target implies 9.9% upside for Mandiri
 and this compares well with other banks in Indonesia, supporting our Overweight rating.

 Kalbe Farma – Changes in KLBF’s marketing strategy in the past 12-18 months are showing signs of driving revenue growth acceleration. Our recent meeting with
 management increases our conviction on the sustainability of this growth. Kalbe’s exposure to underpenetrated high-growth categories, unrivaled distribution reach
 and an expanding product portfolio are its key attractions. Improvement in growth trajectory, cash flow generation and return ratios will support valuations, in our view.

 PTT – Largest beneficiary of any LPG/CNG decontrol in Thailand. With the government’s focus on starting LPG decontrol in1H13, we see 10-12% leverage to 2014
 EPS assuming the government is partially successful with its efforts. Also, with more downside risks to domestic gas prices, the pace of subsidy increase will reduce,
 assuming no decontrol. The stock trades at 7.3x 2013e P/E with 7.9% FCF yield, one of the cheapest integrated stocks in Asian oils.

 PTTGC – Stabilizing/declining gas feedstock costs, coupled with improved chemical demand/margins in 2013, supported by higher volumes & stronger balance sheet
 to drive outperformance. Also, PTTGC’s 6% increase in ethylene prices will increase EPS by ~5% and help contain the impact of higher profit sharing. The stock is
 discounting an oil price of US$83/bbl and EV/EBITDA of 6.4x which is a 10% discount to peers.

 Suntec REIT – Suntec Reit’s outperforming office assets are well appreciated by the market, but we think mall overhaul concerns are overdone. At current valuations
 the stock is pricing in 5% growth in Suntec mall rents post renovation, vs. management’s target of 25%. The strong pace of sign-ups for renewed space has been
 encouraging, and rentals secured are on track with management targets. Positive signs of execution, with Phase 1 of 3 reopening in June, will help rerate the stock in
 our view.



  Source: E = Morgan Stanley Research estimates. Closing price 3 May, 2013.




                                                                                                                                  17
                                                                                                                    MORGAN               STANLEY        RESEARCH

                                                                                                                    May 4, 2013                                                                                                                                               MORGAN STANLEY RESEARCH
                                                                                                                    ASEAN Equity Strategy                                                                                                                                                                                             May 3, 2013
                                                                                                                                                                                                                                                                                                                             ASEAN Equity Strategy



Morgan Stanley Sector Model for May 2013
                                                                                                                                                 250
                                                                                                                                                                        MS OW/UW Relative To MSCI Weight: MSCI Indonesia
                                                Key Changes                                                                                             200

                                                                                                                                                 150
                                                                                                                                                                          100
                                               Indonesia Industrials                                                UW → EW
                                                                                                                                                  50
       Upgrade                                                                                                                                                                                 0                                    0                              0                                0                       0

                                         Singapore Real Estate                                                      EW → OW                       -50



                                               Indonesia Consumer
                                                                                                                                                                                                                                                                                                                                                  -100
                                                                                                                                                 -150
                                                                                                                    EW → UW
                                                   Discretionary                                                                                 -250
                                                                                                                                                                                                                                                                                                                                                                    -200
   Downgrade




                                                                                                                                                         Financials




                                                                                                                                                                          Health Care




                                                                                                                                                                                            Consumer Staples




                                                                                                                                                                                                                                  Industrials




                                                                                                                                                                                                                                                                 Healthcare




                                                                                                                                                                                                                                                                                                  Materials




                                                                                                                                                                                                                                                                                                                      Telecommunication


                                                                                                                                                                                                                                                                                                                                                 Discretionary




                                                                                                                                                                                                                                                                                                                                                                      Energy
                                                                                                                                                                                                                                                                                                                                                  Consumer
                                  Singapore Transportation OW → EW




                                                                                                                                                                                                                                                                                                                           Services
250
                    MS OW/UW Relative To MSCI Weight: MSCI Thailand                                                                              250                    MS OW/UW Relative To MSCI Weight: MSCI Singapore
        200                                                                                                                                             200
200                                                                                                                                              200
150                  100                                                                                                                         150
100                                                                                                                                              100
 50                                 0                  0               0                 0               0                                        50                                    0                           0                               0                                0                         0                              0
   0                                                                                                                                               0
 -50                                                                                                                                              -50
-100                                                                                                                                             -100
-150                                                                                                                  -100
                                                                                                                                                 -150
-200                                                                                                                                             -200
-250                                                                                                                               -200                                                                                                                                                                                                                           -200
                                                                                                                                                 -250
        Materials



                      Energy



                               Discretionary




                                                  Consumer Staples



                                                                     Financials




                                                                                  Telecommunication



                                                                                                      Industrials



                                                                                                                       Utilities



                                                                                                                                   Health Care




                                                                                                                                                          Real Estate




                                                                                                                                                                           Discretionary




                                                                                                                                                                                                               Consumer Staples




                                                                                                                                                                                                                                                Capital Goods




                                                                                                                                                                                                                                                                              Telecommunication




                                                                                                                                                                                                                                                                                                              Banks




                                                                                                                                                                                                                                                                                                                                          Transportation




                                                                                                                                                                                                                                                                                                                                                                 Diversified
                                                                                                                                                                                                                                                                                                                                                                 Financials
                                Consumer




                                                                                                                                                                            Consumer
                                                                                       Services




                                                                                                                                                                                                                                                                                   Services
  Source: Morgan Stanley Research




                                                                                                                                                                                                                                                                18
             MORGAN        STANLEY   RESEARCH

             May 4, 2013                             MORGAN STANLEY RESEARCH
             ASEAN Equity Strategy                                     May 3, 2013
                                                              ASEAN Equity Strategy




Morgan Stanley Sector Model Performance




                                                19
                                                                     MORGAN        STANLEY        RESEARCH

                                                                     May 4, 2013                                                            MORGAN STANLEY RESEARCH
                                                                     ASEAN Equity Strategy                                                                           May 3, 2013
                                                                                                                                                            ASEAN Equity Strategy



April 2013 Performance of Monthly Sector Rotation Model
                    Model Portfolio Performance Relative To MSCI Country (except for LONG/SHORT as
                                                absolute) For April 2013
 10%                INDONESIA              8.42%                                   THAILAND                                                 SINGAPORE
  8%

  6%        4.66%
  4%                                                                                                                                                                3.44%

  2%

  0%
                                                                                        -0.30%
 -2%                                                                                                   -1.23%                        -1.46%
                                                                        -1.53%
 -4%                       -3.47%
 -6%                                                                                                                                                -4.74%
             LONG          SHORT           LONG /                         LONG          SHORT          LONG /                         LONG           SHORT          LONG /
                                           SHORT                                                       SHORT                                                        SHORT


 • Indonesia Long basket outperformed MSCI Indonesia by 4.7%, while the Short basket underperformed by -3.5%. The Long/Short strategy yielded
 +8.4%. MSCI Indonesia Financials (OW) outperformed by 0.84%, while MSCI Indonesia Health Care (OW) outperformed by 8.49%.MSCI Indonesia
 Energy (UW) underperformed by 4.31%, while MSCI Indonesia Industrials (UW) underperformed by 2.62%.

 • Thailand Long basket underperformed MSCI Thailand by 1.5%, while the Short basket outperformed by 0.3%. The Long/Short strategy yielded
 -1.2%. MSCI Thailand Materials (OW) underperformed by 1.94%, while MSCI Thailand Energy (OW) underperformed by 1.11%. MSCI Thailand
 Utilities (UW) underperformed by 1.6%, while MSCI Thailand Health Care (UW) outperformed by 1% .

 • Singapore Long basket underperformed MSCI Singapore by 1.5%, while the Short basket underperformed by 4.7%. The Long/Short strategy yielded
 +3.4%. MSCI Singapore Transportation (OW) underperformed by 1.46%, while MSCI Singapore Diversified Financials (UW) underperformed by
 4.74%.
Source: IBES, DataStream, Morgan Stanley Research
Long (Short) Performance is the average performance of OW (UW) sectors relative to benchmark MSCI index. Long/Short performance is the relative performance of OW sectors against
UW sectors.
Long (Short) includes 2 OW (UW) sectors for Indonesia and Thailand, 1 OW (UW) sector for Singapore. Please also refer to Back Test discussion later in this report.


                                                                                                                                       20
                                                                     MORGAN        STANLEY        RESEARCH

                                                                     May 4, 2013                                                   MORGAN STANLEY RESEARCH
                                                                     ASEAN Equity Strategy                                                            May 3, 2013
                                                                                                                                             ASEAN Equity Strategy



Morgan Stanley Sector Model Cumulative Alpha Generation Since May 2012

                       Cumulative Return
                        Since May 2012                                      Indonesia                            Thailand          Singapore
                            Return

                               MSCI Index                                       12.7%                                14.0%           11.7%

                      MS Sector Portfolio                                       15.1%                                14.1%           11.8%

                            Relative
                       Performance of MS                                        2.16%                                -0.30%          0.02%
                        Sector Portfolio

April 2013 Performance Update

• Indonesia Sector Model: OW Financials by 200bps and Health care by 100bps, while UW Energy by 200bps and
Industrials by 100bps. MS sector model outperformed MSCI Indonesia by 2.16% in April 2013.
• Thailand Sector Model: OW Materials by 200 bps and Energy by 100bps, while UW Utilities by 200 bps and Health Care
100 bps. MS sector model underperformed MSCI Thailand by 0.3% in April 2013.
• Singapore Sector Model: OW Transportation by 200bps, while UW Diversified Financials by 200bps. MS sector model
outperformed MSCI Singapore by 0.02% in April 2013.

Source: IBES, DataStream, Morgan Stanley Research. Please also refer to Back Test discussion later in this report.




                                                                                                                              21
                                                                                                                      MORGAN              STANLEY      RESEARCH

                                                                                                                      May 4, 2013                                                                                      MORGAN STANLEY RESEARCH
                                                                                                                      ASEAN Equity Strategy                                                                                                                May 3, 2013
                                                                                                                                                                                                                                                  ASEAN Equity Strategy



Morgan Stanley Sector Model Monthly Alpha
                 Return of MS Sector Portfolio for Indonesia Relative To MSCI
35                                                            33                                                                         33
                                      Indonesia (bps)                     32                                                                        Note:
30                    28                                                                                                                            - Overall performance of MS Sector portfolio is the sum of
25                                                                        24                                                                        the weighted performances of individual sectors.
                                                20                                                               19                                 - This overall performance is then compared with the
20
                                                                                                                                                    respective MSCI country index’s performance.
15
                                                             12
      10
10
                                                                                        4
 5
                                     1
 0
      2-May-12




                                                                                      Nov-Dec 12
                      2-Jun-12


                                   1-Jul-12


                                                1-Aug-12


                                                             3-Sep-12


                                                                          1-Oct-12




                                                                                                     2-Jan-13


                                                                                                                 1-Feb-13


                                                                                                                             1-Mar-13


                                                                                                                                         1-Apr-13
                   Return of MS Sector Portfolio for Thailand Relative To MSCI                                                                                    Return of MS Sector Portfolio for Singapore Relative To MSCI
40                                      Thailand (bps)                                                                                                                                 Singapore (bps)
         30              29                                                                                                                                             9
30                                                                                                                                                    10
                                                                                                                                                                                                                                                 6                                7
20                                                                                                                                                                                 4
                                                                                                                                                      5                                       3
                                                                                                        7
10                                                                                                                                                                                                                       0                                             0
                                                                                                                                                      0
 0
                                                                                                                                                                                                        -1
                                                                                         -3                                               -3
-10                                                -4                        -5                                                                       -5
                                                                                                                             -10                            -5
-20
                                                              -18
                                                                                                                 -20                                 -10                                                                                                   -8
-30
                                    -33                                                                                                              -15
-40                                                                                                                                                                                                                               -13
                                                                                                                                                           2-May-12




                                                                                                                                                                                                                                  Nov-Dec 12




                                                                                                                                                                                                                                                          1-Feb-13
                                                                                                                                                                      2-Jun-12



                                                                                                                                                                                 1-Jul-12




                                                                                                                                                                                                                       1-Oct-12




                                                                                                                                                                                                                                               2-Jan-13




                                                                                                                                                                                                                                                                     1-Mar-13
                                                                                                                                                                                            1-Aug-12



                                                                                                                                                                                                       3-Sep-12




                                                                                                                                                                                                                                                                                1-Apr-13
        2-May-12




                                                                                        Nov-Dec 12
                        2-Jun-12



                                     1-Jul-12



                                                  1-Aug-12



                                                               3-Sep-12



                                                                           1-Oct-12




                                                                                                      2-Jan-13



                                                                                                                  1-Feb-13



                                                                                                                              1-Mar-13



                                                                                                                                         1-Apr-13




Source: IBES, DataStream, Morgan Stanley Research. Please also refer to Back Test discussion later in this report.




                                                                                                                                                                                                                  22
                                                                                                                                                   MORGAN                  STANLEY    RESEARCH

                                                                                                                                                   May 4, 2013                                                                                   MORGAN STANLEY RESEARCH
                                                                                                                                                   ASEAN Equity Strategy                                                                                                             May 3, 2013
                                                                                                                                                                                                                                                                            ASEAN Equity Strategy




Performance of Focus Stocks Since Inception
 120                   MS Indonesia Focus Stocks Indexed Relative Performance                                                                                                      115              MS Thailand Focus Stocks Indexed Relative Performance
                                         to MSCI Indonesia                                                                                                                                                            to MSCI Thailand

 115                                                                                                                                                                               110

                                                                                                                                                                                   105
 110

                                                                                                                                                                                   100
 105
                                                                                                                                                                                     95
 100
                                                                                                                                                                                     90

  95
                                                                                                                                                                                     85
                                                                Aug-11




                                                                                                                                 Aug-12
          Oct-10



                            Feb-11
                                      Apr-11

                                                  Jun-11


                                                                           Oct-11



                                                                                             Feb-12
                                                                                                       Apr-12
                                                                                                                   Jun-12



                                                                                                                                             Oct-12
                   Dec-10




                                                                                    Dec-11




                                                                                                                                                               Feb-13
                                                                                                                                                                        Apr-13
                                                                                                                                                      Dec-12




                                                                                                                                                                                                                     Nov-11




                                                                                                                                                                                                                                                                              Nov-12
                                                                                                                                                                                          May-11




                                                                                                                                                                                                                                                 May-12
                                                                                                                                                                                                            Sep-11




                                                                                                                                                                                                                                                                   Sep-12
                                                                                                                                                                                                                              Jan-12

                                                                                                                                                                                                                                       Mar-12




                                                                                                                                                                                                                                                                                       Jan-13

                                                                                                                                                                                                                                                                                                Mar-13
                                                                                                                                                                                                   Jul-11




                                                                                                                                                                                                                                                          Jul-12
 103                 MS Singapore Focus Stocks Indexed Relative Performance to MSCI
                                              Singapore                                                                                                                          Our Indonesia and Thailand Focus stocks have outperformed respective
 101                                                                                                                                                                             country MSCI indices by 1801 bps and 647 bps since inception (most of
                                                                                                                                                                                 the outperformance came in the last 12 months).
  99

  97                                                                                                                                                                             However, our Singapore focus stocks have however underperformed by
                                                                                                                                                                                 1567 bps since inception.
  95

  93

  91

  89

  87

  85
                   May-11




                                                           Nov-11




                                                                                              May-12




                                                                                                                                          Nov-12
       Mar-11




                                                                         Jan-12




                                                                                                                                                      Jan-13
                             Jul-11




                                                                                    Mar-12




                                                                                                          Jul-12




                                                                                                                                                               Mar-13
                                         Sep-11




                                                                                                                            Sep-12




                                                                                                                                                                                                                                            23
             MORGAN        STANLEY   RESEARCH

             May 4, 2013                             MORGAN STANLEY RESEARCH
             ASEAN Equity Strategy                                     May 3, 2013
                                                              ASEAN Equity Strategy




Morgan Stanley Sector Model Methodology




                                                24
                                                                MORGAN        STANLEY   RESEARCH

                                                                May 4, 2013                                          MORGAN STANLEY RESEARCH
                                                                ASEAN Equity Strategy                                                     May 3, 2013
                                                                                                                                 ASEAN Equity Strategy



MSCI ASEAN (Indonesia, Thailand & Singapore) Constituents
                                            Weight                                           Weight                                          Weight
           MSCI INDONESIA                                            MSCI THAILAND                              MSCI SINGAPORE
                                             (%)                                              (%)                                             (%)
      CONSUMER DISCRETIONARY                  15.3           CONSUMER DISCRETIONARY             2.1         CONSUMER DISCRETIONARY              8.5
ASTRA INTERNATIONAL                           12.9     BEC WORLD                                2.1   GENTING SINGAPORE                         3.8
GLOBAL MEDIACOM                                1.2              CONSUMER STAPLES               11.1   SINGAPORE PRESS HDG.                      2.7
MEDIA NUSNT.CITRA                              1.2     CP ALL                                   5.8   JARDINE CYC.& CARR.                       2.0
         CONSUMER STAPLES                     12.2     CHAROEN POKPHAND FOODS                   3.0            CONSUMER STAPLES                 4.9
UNILEVER INDONESIA                             3.4     SIAM MAKRO                               2.3   WILMAR INTL.                              2.4
INDOFOOD SUKSES MAKMUR                         2.9                    ENERGY                   19.8   GOLDEN AGRI-RESOURCES                     1.5
GUDANG GARAM                                   2.2     PTT                                      8.9   OLAM INTERNATIONAL                        1.0
CHAROEN POKPHAND INDO.                         3.2     PTT EXPLORATION & PRDN.                  6.8                 FINANCIALS                 53.5
ASTRA AGRO LESTARI                             0.6                                                    ASCENDAS REAL ESTATE IT.                  2.1
                                                       THAI OIL                                 1.7
               ENERGY                          4.6                                                    CAPITACOMMERCIAL TRUST                    1.3
                                                       BANPU                                    1.1
ADARO ENERGY                                   1.5                                                    CAPITALAND                                3.7
                                                       IRPC                                     1.3
INDO TAMBANGRAYA MEGAH                         1.2                                                    CAPITAMALL TRUST                          2.1
                                                                    FINANCIALS                 40.3
TAMBANG BTBR.BUKIT ASAM                        1.1                                                    CAPITAMALLS ASIA                          1.1
                                                       SIAM COMMERCIAL BANK                    10.4
BUMI RESOURCES                                 0.8                                                    CITY DEVELOPMENTS                         2.2
                                                       KASIKORNBANK FB                          8.0
             FINANCIALS                       34.6                                                    DBS GROUP HOLDINGS                       12.3
                                                       BANGKOK BANK FB                          5.9
BANK CENTRAL ASIA                             11.6                                                    GLOBAL LOGISTIC PROPS.                    2.3
                                                       KASIKORNBANK                             4.6   KEPPEL LAND                               1.2
BANK RAKYAT INDONESIA                          9.2
                                                       BANGKOK BANK                             3.9   OVERSEA-CHINESE BKG.                     10.8
BANK MANDIRI                                   8.4
                                                       KRUNG THAI BANK                          2.7   SINGAPORE EXCHANGE                        2.5
BANK NEGARA INDONESIA                          3.5
                                                       BANK OF AYUDHYA                          2.5   UNITED OVERSEAS BANK                     10.8
BANK DANAMON INDONESIA                         1.9
                                                       CENTRAL PATTANA                          2.1   UOL GROUP                                 1.3
            HEALTH CARE                        2.7
                                                                  HEALTH CARE                   1.6                INDUSTRIALS                 19.9
KALBE FARMA                                    2.7
            INDUSTRIALS                        3.8     BGK.DUSIT MED.SVS.                       1.6   KEPPEL                                    5.8
UNITED TRACTORS                                2.7                 INDUSTRIALS                  2.0   SINGAPORE AIRLINES                        2.3
JASA MARGA                                     1.2     AIRPORTS OF THAILAND                     2.0   SEMBCORP INDUSTRIES                       1.9
             MATERIALS                         8.4                  MATERIALS                  11.7   SINGAPORE TECHS.ENGR.                     2.6
SEMEN GRESIK                                   5.0     SIAM CEMENT FB                           4.7   NOBLE GROUP                               1.7
ICT.TUNGGAL PRAKARSA                           3.5     PTT GLOBAL CHEMICAL                      3.8   HUTCHISON PORT HDG.TRUST                  2.0
    TELECOMMUNICATION SERVICES                12.3     SIAM CEMENT                              2.0   SEMBCORP MARINE                           1.4
TELEKOMUNIKASI INDONESIA                      10.5     INDORAMA VENTURES                        1.1   COMFORTDELGRO                             1.5
XL AXIATA                                      1.1         TELECOMMUNICATION SERVICES          10.1   YANGZIJIANG SHIPBUILDING (HOLDINGS)       0.7
INDOSAT                                        0.7     ADVANCED INFO SER.                      10.1       TELECOMMUNICATION SERVICES           13.1
              UTILITIES                        5.9                   UTILITIES                  1.2   SINGAPORE TELECOM                        12.0
PERUSAHAAN GAS NEGARA                          5.9     GLOW ENERGY                              1.2   STARHUB                                   1.1

Source: MSCI, Morgan Stanley Research. Data as of 2 May 2013.




                                                                                                                25
                                                      MORGAN        STANLEY      RESEARCH

                                                      May 4, 2013                                                       MORGAN STANLEY RESEARCH
                                                      ASEAN Equity Strategy                                                                May 3, 2013
                                                                                                                                  ASEAN Equity Strategy



Description of Factors Used in MS Five-Factor Quant Model
                           Price-To-Earnings (PE)        Ranks Sectors on Z score of 3 years Relative Trailing PER.



  Valuations                 Price-To-Book (PB)           Ranks Sectors on Z score of 3 years Relative Trailing P/B.


                            Dividend Yield (DY):          Ranks Sectors on Z score of 3 years Relative Trailing Dividend Yield.


 Profitability                                           Ranks Sectors on Z score of 3 years Relative Trailing RoE
                          Return on Equity (ROE)
 Momentum

                          MoM Earnings Revision         Ranks Sectors on Absolute MoM Consensus Earnings Revision for 2013


 Earnings                                               Ranks Sectors on Absolute YTD Consensus Earnings Revision for 2013
                          YTD Earnings Revision
 Momentum
                     12-mth Forward Earnings growth     Ranks Sectors on Z score of 3 year Earnings Growth.


  Earnings
  Revision              Earnings Revision Breadth       Measures earnings revision breadth (Number of Upward revisions – Number of Downward
                                                        revision)/(Total number of revisions).
  Breadth
                       Short-term Price Performance     Ranks Sectors on absolute price performance for the past one month.
   Price
 Momentum                                               Ranks Sectors on absolute price performance of the past 12 months.
                      Long-term Price Performance



We have conducted back testing since January 2007 to arrive at Factors and Weight for each country. Our Final
Rank is based on a combination of our Five-Factor Model Quantitative Rank (50%) and Qualitative Rank (50%). We
increased our qualitative weight from 30% to 50% in 2013 to incorporate a higher proportion of bottom up views.
 Source: Morgan Stanley Research




                                                                                                                   26
                                                                                                                           MORGAN                     STANLEY        RESEARCH

                                                                                                                           May 4, 2013                                                                                                             MORGAN STANLEY RESEARCH
                                                                                                                           ASEAN Equity Strategy                                                                                                                                       May 3, 2013
                                                                                                                                                                                                                                                                              ASEAN Equity Strategy



Indonesia Back-Test Results
340                                                                                                                                                       400
                   LONG Sector Performance Relative To MSCI Indonesia                                                                                                                         LONG/SHORT Performance: Indonesia
320
300                                                                                                                                                       350
280
260                                                                                                                                                       300
240
220                                                                                                                                                       250
200
                                                                                                                                                          200
180
160
                                                                                                                                                          150
140
120                                                                                                                                                       100
100
 80                                                                                                                                                        50
      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




                                                                                                                                                                 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
We have back tested our Indonesia sector model using Quantitative                                                                                                          Indonesia Back-Test Model Portfolio Performance Relative To
factors. For details, please see ASEAN Equity Strategy: ASEAN 3                                                                                                            MSCI Indonesia (except for LONG/ SHORT as absolute) Since
Sector Rotation Model, May 1, 2012.                                                                                                                       250%                              Jan 2007 Till April 2012)             232%
                                                                                                                                                                                        204%
                                                                                                                                                          200%
Since January 2007, the Long-Only portfolio by selecting the top 2 ranked
sectors (on the above-mentioned parameters) every month, has delivered
                                                                                                                                                          150%
a cumulative outperformance of 204%, with a hit ratio of 62% versus
MSCI Indonesia.                                                                                                                                           100%


The Long/Short strategy of selecting the top 2 and bottom 2 ranked                                                                                        50%
sectors (on the above-mentioned parameters) delivered a cumulative
return of 232% since 2007, with a hit ratio of 56%.                                                                                                        0%
                                                                                                                                                                                                                                           -8%
Note: The sectors take equal weight within each portfolio. These portfolios are updated                                                                   -50%
monthly based on the new sector ranking. We assume a costless transaction in the                                                                                            LONG (OW Sectors)                                   SHORT (UW Sectors)                                     LONG / SHORT
monthly sector rotation.

 Source: DataStream, Morgan Stanley Research
 Long (Short) Performance is the average performance of OW (UW) sectors relative to benchmark MSCI index. Long/Short performance is the relative performance of OW sectors
 against UW sectors.
 Long (Short) includes 2 OW (UW) sectors for Indonesia and Thailand, 1 OW (UW) sector for Singapore.


                                                                                                                                                                                                                                          27
                                                                                                                                                                 MORGAN                             STANLEY              RESEARCH

                                                                                                                                                                 May 4, 2013                                                                                                                                                 MORGAN STANLEY RESEARCH
                                                                                                                                                                 ASEAN Equity Strategy                                                                                                                                                                                        May 3, 2013
                                                                                                                                                                                                                                                                                                                                                                     ASEAN Equity Strategy



 Thailand Back-Test Results
 320                                                                                                                                                                                                         450
                         LONG Sector Performance Relative To MSCI Thailand                                                                                                                                                                                    LONG/SHORT Performance: Thailand
 300
                                                                                                                                                                                                             400
 280
 260                                                                                                                                                                                                         350
 240
                                                                                                                                                                                                             300
 220
 200                                                                                                                                                                                                         250
 180
                                                                                                                                                                                                             200
 160
 140                                                                                                                                                                                                         150
 120
                                                                                                                                                                                                             100
 100
  80                                                                                                                                                                                                          50
       Jan-07
                Apr-07
                         Jul-07
                                  Oct-07
                                           Jan-08
                                                    Apr-08
                                                             Jul-08
                                                                      Oct-08
                                                                               Jan-09
                                                                                        Apr-09
                                                                                                 Jul-09
                                                                                                          Oct-09
                                                                                                                   Jan-10
                                                                                                                            Apr-10
                                                                                                                                     Jul-10
                                                                                                                                              Oct-10
                                                                                                                                                       Jan-11
                                                                                                                                                                Apr-11
                                                                                                                                                                         Jul-11
                                                                                                                                                                                  Oct-11
                                                                                                                                                                                           Jan-12
                                                                                                                                                                                                    Apr-12




                                                                                                                                                                                                                    Jan-07
                                                                                                                                                                                                                             Apr-07
                                                                                                                                                                                                                                       Jul-07
                                                                                                                                                                                                                                                Oct-07
                                                                                                                                                                                                                                                         Jan-08
                                                                                                                                                                                                                                                                  Apr-08
                                                                                                                                                                                                                                                                           Jul-08
                                                                                                                                                                                                                                                                                    Oct-08
                                                                                                                                                                                                                                                                                             Jan-09
                                                                                                                                                                                                                                                                                                      Apr-09
                                                                                                                                                                                                                                                                                                               Jul-09
                                                                                                                                                                                                                                                                                                                        Oct-09
                                                                                                                                                                                                                                                                                                                                 Jan-10
                                                                                                                                                                                                                                                                                                                                          Apr-10
                                                                                                                                                                                                                                                                                                                                                   Jul-10
                                                                                                                                                                                                                                                                                                                                                            Oct-10
                                                                                                                                                                                                                                                                                                                                                                     Jan-11
                                                                                                                                                                                                                                                                                                                                                                              Apr-11
                                                                                                                                                                                                                                                                                                                                                                                       Jul-11
                                                                                                                                                                                                                                                                                                                                                                                                Oct-11
                                                                                                                                                                                                                                                                                                                                                                                                         Jan-12
                                                                                                                                                                                                                                                                                                                                                                                                                  Apr-12
 We have back tested our Thailand Sector model using Quantitative                                                                                                                                                               Thailand Back-Test Model Portfolio Performance Relative To
 factors.                                                                                                                                                                                                                      MSCI Thailand (except for LONG/ SHORT as absolute) Since Jan
                                                                                                                                                                                                             300%                                   2007 Till April 2012)             276%

 Since January 2007, the Long-Only portfolio by selecting the top 2 ranked                                                                                                                                   250%
 sectors (on the above-mentioned parameters) every month has delivered
 a cumulative outperformance of 187%, with a hit ratio of 67% versus                                                                                                                                         200%                                  187%

 MSCI Thailand.
                                                                                                                                                                                                             150%

 The Long/Short strategy of selecting top 2 and bottom 2 ranked sectors                                                                                                                                      100%
 (on the above-mentioned parameters) delivered a cumulative
                                                                                                                                                                                                             50%
 performance of 276% since 2007, with a hit ratio of 63%.
                                                                                                                                                                                                              0%
 Note: The sectors take equal weight within each portfolio. These portfolios are updated
 monthly based on the new sector ranking. We assume a costless transaction in the                                                                                                                            -50%                                                                                                       -24%
 monthly sector rotation.                                                                                                                                                                                                             LONG (OW Sectors)                                               SHORT (UW Sectors)                                                      LONG / SHORT



Source: DataStream, Morgan Stanley Research
Long (Short) Performance is the average performance of OW (UW) sectors relative to benchmark MSCI index. Long/Short performance is the relative performance of OW sectors against
UW sectors.
Long (Short) includes 2 OW (UW) sectors for Indonesia and Thailand, 1 OW (UW) sector for Singapore.


                                                                                                                                                                                                                                                                                                                  28
                                                                                                                                                                MORGAN                             STANLEY             RESEARCH

                                                                                                                                                                May 4, 2013                                                                                                                                               MORGAN STANLEY RESEARCH
                                                                                                                                                                ASEAN Equity Strategy                                                                                                                                                                                      May 3, 2013
                                                                                                                                                                                                                                                                                                                                                                  ASEAN Equity Strategy



Singapore Back-Test Results
220                                                                                                                                                                                                         400
                        LONG Sector Performance Relative To MSCI Singapore                                                                                                                                                                               LONG/SHORT Performance: Singapore
200                                                                                                                                                                                                         350

180                                                                                                                                                                                                         300

160                                                                                                                                                                                                         250

140                                                                                                                                                                                                         200

120                                                                                                                                                                                                         150

100                                                                                                                                                                                                         100

 80                                                                                                                                                                                                          50
      Jan-07
               Apr-07
                        Jul-07
                                 Oct-07
                                          Jan-08
                                                   Apr-08
                                                            Jul-08
                                                                     Oct-08
                                                                              Jan-09
                                                                                       Apr-09
                                                                                                Jul-09
                                                                                                         Oct-09
                                                                                                                  Jan-10
                                                                                                                           Apr-10
                                                                                                                                    Jul-10
                                                                                                                                             Oct-10
                                                                                                                                                      Jan-11
                                                                                                                                                               Apr-11
                                                                                                                                                                        Jul-11
                                                                                                                                                                                 Oct-11
                                                                                                                                                                                          Jan-12
                                                                                                                                                                                                   Apr-12




                                                                                                                                                                                                                  Jan-07
                                                                                                                                                                                                                           Apr-07
                                                                                                                                                                                                                                    Jul-07
                                                                                                                                                                                                                                             Oct-07
                                                                                                                                                                                                                                                      Jan-08
                                                                                                                                                                                                                                                               Apr-08
                                                                                                                                                                                                                                                                        Jul-08
                                                                                                                                                                                                                                                                                 Oct-08
                                                                                                                                                                                                                                                                                          Jan-09
                                                                                                                                                                                                                                                                                                   Apr-09
                                                                                                                                                                                                                                                                                                            Jul-09
                                                                                                                                                                                                                                                                                                                     Oct-09
                                                                                                                                                                                                                                                                                                                              Jan-10
                                                                                                                                                                                                                                                                                                                                       Apr-10
                                                                                                                                                                                                                                                                                                                                                Jul-10
                                                                                                                                                                                                                                                                                                                                                         Oct-10
                                                                                                                                                                                                                                                                                                                                                                  Jan-11
                                                                                                                                                                                                                                                                                                                                                                           Apr-11
                                                                                                                                                                                                                                                                                                                                                                                    Jul-11
                                                                                                                                                                                                                                                                                                                                                                                             Oct-11
                                                                                                                                                                                                                                                                                                                                                                                                      Jan-12
                                                                                                                                                                                                                                                                                                                                                                                                               Apr-12
We have back tested our Singapore Sector model using Quantitative                                                                                                                                                              Singapore Back-Test Model Portfolio Performance Relative To
factors.                                                                                                                                                                                                                       MSCI Singapore (except for LONG/ SHORT as absolute) Since
                                                                                                                                                                                                            300%                                Jan 2007 Till April 2012)             276%

Since January 2007, the Long-Only portfolio by selecting top 2 ranked                                                                                                                                       250%
sectors (on the above-mentioned parameters) every month has delivered
                                                                                                                                                                                                            200%
a cumulative outperformance of 112% with a hit ratio of 65% versus
MSCI Singapore.                                                                                                                                                                                             150%
                                                                                                                                                                                                                                                 112%
                                                                                                                                                                                                            100%
The Long/Short strategy of selecting the top 2 and bottom 2 ranked
                                                                                                                                                                                                             50%
sectors (on the above-mentioned parameters) delivered a cumulative
outperformance of 276% since 2007, with a hit ratio of 58%.                                                                                                                                                   0%

                                                                                                                                                                                                            -50%
Note: The sectors take equal weight within each portfolio. These portfolios are updated                                                                                                                                                                                                                              -43%
monthly based on the new sector ranking. We assume a costless transaction in the                                                                                                                            -100%
monthly sector rotation.                                                                                                                                                                                                            LONG (OW Sectors)                                              SHORT (UW Sectors)                                                      LONG / SHORT



 Source: DataStream, Morgan Stanley Research
 Long (Short) Performance is the average performance of OW (UW) sectors relative to benchmark MSCI index. Long/Short performance is the relative performance of OW sectors
 against UW sectors.
 Long (Short) includes 2 OW (UW) sectors for Indonesia and Thailand, 1 OW (UW) sector for Singapore.


                                                                                                                                                                                                                                                                                                               29
          MORGAN        STANLEY   RESEARCH

          May 4, 2013                             MORGAN STANLEY RESEARCH
          ASEAN Equity Strategy                                     May 3, 2013
                                                           ASEAN Equity Strategy




Risk-Reward for Top 5 Focus Stocks




                                             30
                                                                               MORGAN            STANLEY                                      RESEARCH

                                                                               May 4, 2013                                                                                             MORGAN STANLEY RESEARCH
                                                                               ASEAN Equity Strategy                                                                                                           May 3, 2013
                                                                                                                                                                                                      ASEAN Equity Strategy




Key Focus Stock for May 2013: PT Bank Mandiri (BMRI.JK, Rp10,150, OW, PT10,768)
 Rp18,000
                                                                                                                                                   Investment Thesis: Why OW
                                                                                               Rp16,487 (+62%)
   16,000                                                                                                                                          •We expect Bank Mandiri to deliver the fastest 2-year
   14,000
                                                                                                                                                   NPAT growth in the industry, helped by margin expansion
                                                                                                                                                   – and we believe this is not in the price.
   12,000                                                                                                                                          •We think Mandiri has made significant improvements to its
                                                                         Rp 10,150
                                                                                               Rp10,768 (+6% )                                     franchise. Its funding costs have already shown the biggest
   10,000                                                                                                                                          improvement in the industry, and we now expect a pickup in risk-
    8,000
                                                                                                                                                   adjusted asset yields. Our price target implies 6.1% upside
                                                                                                                                                   for Mandiri and this compares well with other banks in
    6,000
                                                                                                 Rp6,441 (-37%)
                                                                                                                                                   Indonesia, supporting our Overweight rating.
                                                                                                                                                   •Mandiri is the best positioned of the Indonesian banks to
    4,000
                                                                                                                                                   become a universal financial services provider.
    2,000

                                                                                                                                                   Key Value Drivers
       0
       May-11             Nov-11       May-12             Nov-12          May-13           Nov-13                           May-14                 •The main drivers are NIM expansion and credit charges.
        Price Target (May-14)             Historical Stock Performance               Current Stock Price   WARN INGDONOTEDIT_RR S4R L~BMR I.J K~   Each 10bps of NIM expansion would add 3% to EPS. Each
    Price Target Rp10,768          We derive our valuation from a three-stage Gordon growth model.                                                 10bps in credit charges would reduce earnings by 2.4%.
                                   For our price target, we assign 60% probability to our base-case
                                   valuation, 20% to our bull case, and 20% to our bear case.                                                      Potential Catalysts
    Bull            18.5x Bull     Stable inflation and increased infrastructure investment:                                                       •Stabilising macro confidence.
    Case            Case 2013e     Inflation remains controlled, requiring limited policy response.                                                •Further moves to restructure Mandiri’s variable-rate
                                                                                                                                                   recapitalization bonds.
    Rp16,487        EPS            Increased infrastructure spending leads to 8% GDP growth.
                                   Mandiri increases loans at 23% CAGR (2012-2017e).
                                                                                                                                                   •Continued evidence of franchise improvement, e.g., a further fall
                                                                                                                                                   in deposit costs, or an increase in asset yields.
    Base            12.9x Base     Stable inflation outlook, patchy investment in infrastructure:
    Case            Case 2013e     Inflation remains controlled, requiring limited policy response.                                                Where We Could Wrong? (Downside Risks)
    Rp10,304        EPS            Infrastructure investment subject to blockages; GDP growth                                                      •Benefits of rising loan-to-deposit ratio and switch into higher-
                                   limited to 5.7% p.a. Mandiri expands loans at 17.8% CAGR                                                        margin loans are offset by continued competitive or regulatory
                                   (2012-2017e)                                                                                                    pressure on loans.
                                                                                                                                                   •Rising CAD and more rapid tightening of monetary policy could
    Bear            9.6x Bear      Currency weakness, no progress in infrastructure                                                                result in higher loan losses, which would cause Mandiri to
    Case            Case 2013e     investment: Rising CAD results in falling currency and a loss of                                                disappoint.
    Rp6,441         EPS            confidence in the economy. Limited progress in infrastructure
                                   spending. Mandiri expands loans at 17% CAGR (2012-2017e).


 Source: DataStream, Thomson One, Morgan Stanley Research Price is as of the close, May 2, 2013




                                                                                                                                                                                  31
                                                                       MORGAN               STANLEY                           RESEARCH

                                                                       May 4, 2013                                                                                MORGAN STANLEY RESEARCH
                                                                       ASEAN Equity Strategy                                                                                                May 3, 2013
                                                                                                                                                                                   ASEAN Equity Strategy




Key Focus Stock for May 2013: Kalbe Farma (KLBF.JK, Rp1,240, OW, PT1,480)
    Rp 2,500
                                                                                                                                   Why Overweight
                                                                                                                                   • Best listed play in Indonesia’s underpenetrated
                                                                                            Rp1,950                                  healthcare & nutrition industry. Kalbe Farma is
        2,000                                                                               (+44%)                                   Indonesia’s largest pharmaceutical player, with leading
                                                                                                                                     presence in the high-growth dairy and nutrition foods
                                                                                Rp1,480                                              categories. Kalbe with leadership positions and the most
        1,500                                                Rp 1,350                                                                extensive distribution network is best placed to capitalize
                                                                                (+10% )                                              on this growth.
                                                                                                                                   • Strong EPS CAGR of 18% in 2012-15: Growth
        1,000                                                              Rp940 (-30%)                                              momentum is improving post changes in KLBF’s
                                                                                                                                     marketing strategy is likely to drive higher growth &
          500                                                                                                                        market share gains. We expect revenue & EBIT growth
                                                                                                                                     to accelerate vs. historical trend
                                                                                                                                   • Current multiple is sustainable in light of growth &
            0                                                                                                                        quality: Fundamental improvements in growth trajectory,
            Mar-11       Sep-11      Mar-12       Sep-12       May-13
                                                               Mar-13       Sep-13                     Mar-14                        cash flow generation, higher return ratios and dividend
                                                                                                                                     payout to support valuation
            Price Target (Mar-14)       Historical Stock Performance         Current Stock Price
                                                                                W AR N IN GD ON OTED IT_R R S4R L~KLBF.J K~




  Price Target Rp1.480              Probability weighted assuming 75% weighting to base and                                        Key Value Drivers
                                    15% weight to Bull and 10% weight to Bear case value.                                          • Market share gains through new product innovation and
                                                                                                                                     M&A.
  Bull Case      31x Bull           Market share gains drives revenue CAGR to 20% while                                            • Operating expense control allowing margin stability.
  Rp1,950        Case 13e           favourable cost environment boosts EBIT margin to 18%:                                         • Higher medium-term growth driven by favorable
                 EPS                New product launches and innovative marketing drive share                                        government policies to stimulate drug expenditure.
                                    gains; favourable impact from higher government spend on                                       • Favorable currency/input costs.
                                    healthcare expenditure lifts growth. Input costs recede.
  Base           24.8x Base         Improvement in growth trajectory driven by recent                                              Potential Catalysts
  Case           Case 13 EPS        changes in marketing strategy: Revenue growth accelerates                                      • Price hikes to offset higher costs while maintaining
  Rp1,460                           to 17% in CY12-15 through NPD & penetration led growth.                                          market share.
                                    EBIT CAGR for 2012-15 at 18% is 550bps higher that last 5                                      • New product launches.
                                    years growth trend                                                                             • Falling input costs/IDR appreciation.
                                                                                                                                   • Value-accretive M&A
  Bear Case 15.5x Bear              Limited traction from new products, sharp depreciation in
  Rp940     Case 1e EPS             USDIDR drives costs higher, competitive pressures
                                    increase: Low double digit revenue growth amidst weak                                          Key Risks
                                    consumer sentiment. Margins drop to under 15%.                                                 • Sharp depreciation of IDR/sharp rise in input costs,
                                                                                                                                     inability to hike prices, intensification of competition

 Source: Thomson Reuters, Morgan Stanley Research Price is as of the close, May 2, 2013




                                                                                                                                                             32
                                                                                 MORGAN          STANLEY                          RESEARCH

                                                                                 May 4, 2013                                                                               MORGAN STANLEY RESEARCH
                                                                                 ASEAN Equity Strategy                                                                                           May 3, 2013
                                                                                                                                                                                        ASEAN Equity Strategy




Key Focus Stock for May 2013: PTT (PTT.BK, Bt326, OW, PT Bt409)
  Bt500
                                                                                                                                          Why Overweight?
                                                                                                Bt464.00 (+42%)
   450                                                                                                                                    •We think M&A-related risks are abating and see the
   400                                                                                          Bt409.00 (+25%)                           prospect of decontrol lifting earnings, aiding near- term
                                                                                                                                          stock performance.
   350                                                                    Bt 327.00                                                       •Superior balance sheet and decreasing leverage.
   300                                                                                                                                    •PTT is focused on growth, and we expect its net profit
                                                                                                                                          CAGR to reach 6% in 2012-14e.
   250                                                                                                                                    •No dilution risk from PTTEP, which post the equity raise in
   200
                                                         pt                                      Bt207.00 (-37%)                          2012 is well funded for growth in the medium term.

   150
                                                                                                                                          Key Value Drivers
   100                                                                                                                                    •Gas volumes and output of its GSPs.
    50
                                                                                                                                          •Value of its subsidiaries and affiliates.
                                                                                                                                          •Petchem prices, refining margins.
     0
                                                                                                                                          •LPG price decontrol for the gas separation plants.
     May-11              Nov-11       May-12             Nov-12            May-13          Nov-13                     May-14
          Price Target (May-14)            Historical Stock Performance               Current Stock Price
                                                                                                        WARNINGDONOTEDIT_RRS4RL~PTT.BK~
                                                                                                                                          •CNG price rise/decontrol.

Price Target Bt409                Derived from our base-case SOTP scenario.
                                                                                                                                          Key Downside Risks
Bull             6.3x Bull        1) No holding company discount; PTTEP, TOP, PTTGC valued at                                             •The stock has a historical correlation with the market of
Case             Case 2013e       our bull case values. 2) 10% higher petchem prices, due to                                              1.0x. Any correction in the market might affect PTT.
Bt464            EV/EBITDA        stronger-than-expected petrochemical cycle. 3) Government                                               •Oil marketing business to remain under pressure, due to
                                  decontrol of CNG & LPG prices in 2013 for one quarter                                                   high crude oil prices and upcoming elections.
Base             6.8x Base        1) 15% discount for all subsidiaries and affiliates; non-listed
                                                                                                                                          •Investments in unrelated / low-ROCE businesses, such as
Case             Case 2013e       affiliates valued at book value. 2) Long-term crude oil price of
                                                                                                                                          palm oil and coal terminals, would affect FCF yield in the
                                                                                                                                          medium term.
Bt409            EV/EBITDA        US$90/bbl; petrochemical margins to improve in 2H11. 3) 95%
                                  utilization of GSP in 2013 and domestic oil marketing margin of                                         •Overpaying for acquisitions.
                                  Bt0.85/lit.

Bear             6.9x Bear        1) Refining margins US$1.00/bbl lower than in the base case,
Case             Case 2013e       reflecting lower petroleum product demand. 2) 5% lower petchem
Bt207            EV/EBITDA        netbacks as new capacities come on stream and supply exceeds
                                  demand. 3) Lower gas supplies and 70% GSP utilization in 2011.


Source: DataStream, Thomson One, Morgan Stanley Research Price is as of the close, May 2,2013



                                                                                                                                                                      33
                                                                               MORGAN           STANLEY                            RESEARCH

                                                                               May 4, 2013                                                                              MORGAN STANLEY RESEARCH
                                                                               ASEAN Equity Strategy                                                                                          May 3, 2013
                                                                                                                                                                                     ASEAN Equity Strategy




Key Focus Stock for May 2013: PTTGC (PTTGC.BK, Bt72.75, OW, PT Bt82.0)
Bt120
                                                                                                                                        Investment Thesis: Why OW
                                                                                                                                        •PTTGC’s structural cost advantage in a rising chemical
 100                                                                                                                                    margin environment coupled with stabilizing feedstock cost.
                                                                                               Bt96.00 (+33%)
                                                                                                                                        •Volume and value growth in 2013: We expect PTTGC’s
                                                                                                                                        earnings to see 10% growth in 2013, driven by higher
                                                                                              Bt82.00 (+13%)
  80                                                                Bt 72.25                                                            utilisation rates and MEG expansion.
                                                                                                                                        •Stock price implies Singapore Complex GRM of
  60                                                                                                                                    ~US$6.0/bbl for 2013 (10% discount to spot) and chemical
                                                                                                                                        margin of ~US$320/ton (14% discount to spot).
                                                                                               Bt51.00 (-29%)

  40
                                                                                                                                        Key Value Drivers
                                                                                                                                        •Higher crude oil prices.
  20                                                                                                                                    •Capacity utilization and operating costs.
                                                                                                                                        •Lower refining margins via impending supply in 2013.
   0
   May-11             Nov-11         May-12          Nov-12         May-13              Nov-13                      May-14              Potential Catalysts
   Price Target Bt83
      Price Target (May-14)              Historical base case.
                               Derived from our Stock Performance                  Current Stock Price
                                                                                                    WARNINGDONOTEDIT_RRS4RL~PTTGC.BK~
                                                                                                                                        •Higher dividend payout.
   Bull        8.0x      Rising prices as supply falls amid strong demand: 1) Ethylene                                                  •Higher chemical margins driven by improving Chinese
   Case        EV/EBITDA prices increase 10% as supply pressure eases for Asia and Middle                                               chemical demand and strong 4Q12 earnings growth driven
   Bt97        bull case East. 2) Refining margins for PTTGC return to normalized levels as                                             by volume growth.
               2013e     crude premiums decrease. 3) Capacity utilization rises to 100% on
                         strong demand.                                                                                                 Where Could We Be Wrong? (Downside Risks)
   Base        7.5x      Low cash costs and PX leverage: 1) Crude oil price of US$105/bbl                                               •Netback volatility: Global petrochemical margins are
   Case        EV/EBITDA in 2013, with refining margins of US$5.0bbl and PX margins of                                                  cyclical and volatile, and PTTGC’s earnings may correlate
   Bt83        base case US$500/ton. 2) Operating cost of US$300/ton for the gas cracker.                                               with industry cyclicality.
               2013e     3) 95% cracker utilization in 2013.                                                                            •Lower refining and PX margins reflecting weak global
                                                                                                                                        petroleum and PET demand.
   Bear        4.5x            Oversupply due to weak demand: 1) Refining margins and
                                                                                                                                        •PTTGC’s advantageous feedstock position could
   Case        EV/EBITDA       petrochemical prices correct 10% on lower-than-expected demand.                                          deteriorate with low crude oil prices.
   Bt52        bear case       2) Capacity utilization declines to 75% on unplanned shutdowns,
               2013e           with costs increasing by 10%.



   Source: DataStream, Thomson One, Morgan Stanley Research Price is as of the close, May 2,2013




                                                                                                                                                                   34
                                                                                   MORGAN             STANLEY                                   RESEARCH

                                                                                   May 4, 2013                                                                                           MORGAN STANLEY RESEARCH
                                                                                   ASEAN Equity Strategy                                                                                                         May 3, 2013
                                                                                                                                                                                                        ASEAN Equity Strategy




Key Focus Stock for May 2013: Suntec REIT (SUNT.SI, S$1.92, OW, PT S$2.15)
   Risk-Reward Supported by Positive Rental Reversions + Mall Renewal                                                                               Investment Thesis: Why OW
    S$3.00
                                                                                                                                                    • Mall value overlooked. Share price implies Suntec Mall rents fall
                                                                                                                                                    10% post enhancement, vs. mgmt’s target of a 25% rise. We
      2.50
                                                                                                    S$2.40 (+25%)
                                                                                                                                                    estimate enhancements come through in phases from 2Q13 and
                                                                                                                                                    support div/shr growth of +18%/+12% in 2014/15.
                                                                                                   S$2.15 (+12% )
      2.00
                                                                             S$ 1.92
                                                                                                                                                    • Offices undervalued, recognized on book at 4-4.25% cap rates
                                                                                                                                                    vs. 3.5-3.75% used by peers. This presents an option value of
                                                                                                      S$1.60 (-17%)                                 S$0.33/shr, or 16% upside to the REIT’s 4Q12 NAV/shr.
      1.50
                                                                                                                                                    • Valuation levels compelling at 5.0% DY (3Q13e ann.) and 0.9x
                                                                                                                                                    P/B.
      1.00

                                                                                                                                                    Key Value Drivers
      0.50                                                                                                                                          • Office (71%): Rents and occupancies drive rental revenues from
                                                                                                                                                    tenant leases, which are typically renewed every three years.
      0.00
                                                                                                                                                    • Retail (26%): Rents and occupancies drive rental revenues from
         May-11              Nov-11       May-12            Nov-12           May-13          Nov-13                         May-14                  tenant leases, which are typically renewed every three years.
             Price Target (May-14)            Historical Stock Performance             Current Stock Price   WARNINGDONOTEDIT_RRS4RL~SUNT.SI~




                                                                                                                                                    Potential Catalysts
    Price Target S$2.15               Our price target is based on our base-case target DPU yield for
                                      4Q13e.                                                                                                        • Positive news flow on rental rates and committed occupancies for
                                                                                                                                                    refurbished sections of Suntec Mall.
    Bull             Bull Case        Macro rebound: Singapore office rents rebound, supporting                                                     • Sustained positive rent reversions from office leases.
    Case             DPU / 5.0%       +15% in office passing rents in 2013. Suntec Mall enhancement
    S$2.40           Target DY,       income accretion after 4Q13e contributes S$0.40/shr to
                     +40c for         valuation.                                                                                                    Risks
                     Devt                                                                                                                           • Reversal of Suntec offices’ outperformance due to weaker market
                                                                                                                                                    office demand.
    Base             Base Case        Slow & steady growth: Singapore office spot rents continue                                                    • Filling the remodeled Suntec Mall with the right tenants at the
    Case             DPU / 5.5%       gradual decline, but Suntec offices outperform, while its CBD                                                 right rents.
    S$2.15           Target DY,       portfolio manages positive rent reversions rolling off a low
                     +36cc for        expiring rent hurdle. Suntec Mall enhancement income accretion                                                Suntec REIT Portfolio Composition: 71% Office, 26% Retail
                     Devt             after 4Q13e contributes S$0.36/shr to valuation.                                                                          By Asset                              By Sector

    Bear             Bear Case        Recession: Singapore office rent reversions fall to 0% in 2013
    Case             DPU / 6.5%       as recession fears are realized. Suntec Mall enhancement                                                                               MBFC
                                                                                                                                                                             Ph 1,
    S$1.60           Target DY,       income accretion after 4Q13e contributes S$0.30/shr to                                                           Suntec                 20%
                                                                                                                                                                                                                     Retail,
                     +30c for         valuation.                                                                                                        City,
                                                                                                                                                                                                                      26%
                                                                                                                                                        61%                                 Office,
                     Devt                                                                                                                                                                    71%
                                                                                                                                                                               Park
                                                                                                                                                                              Mall, 5%
   Source: DataStream, Thomson One, Morgan Stanley Research. Price is as of the close,                                                                                                                             Conv
                                                                                                                                                                           ORQ,
   May 2, 2013                                                                                                                                                             15%                                    ctr, 4%




                                                                                                                                                                                  35
                                                          MORGAN        STANLEY    RESEARCH

                                                          May 4, 2013                                                  MORGAN STANLEY RESEARCH
                                                          ASEAN Equity Strategy                                                              May 3, 2013
                                                                                                                                    ASEAN Equity Strategy



Valuation Methodologies for Five Key Focus Stocks
      Company                                                             Valuation Methodology
  Company                                                             Valuation Methodology
                     We use a three-stage Gordon growth model, which sums the NPV of 10 years of explicit dividend forecasts, 10 years of implicit
    PT Bank          dividend forecasts, and forecast terminal BV to derive our base case valuation. We then set our price target by assigning 60%
                     probability to our base case valuation, 20% probability to our bull case and 20% probability to our bear case (see slide 6 for
    Mandiri          scenario valuations). Using our probability-weighted scenario valuations, including a base case valuation of Rp10,304, we arrive at
                     a final price target of Rp10,768 for Mandiri.
                     We arrive at our probability-weighted price target of Rp1,480/sh by assigning a 15% weighting to bull case and 10% to the bear
                     case. Our base case value of Rp1460/sh is derived from a RI model in which we assume 10.5% cost of equity, terminal growth of
                     5%, and terminal ROE of 31.5%. For our bull and bear case values we flex earnings for 2013-15 and apply a target multiple to the
 Kalbe Farma         scenario EPS of 2014 to arrive at our bull and bear case values. The bull case (Rp1950/sh) incorporates better control over selling
                     costs while sales growth and market shares continue to expand, thereby driving margin upside. The bear case (Rp940/sh)
                     incorporates the risk of higher input costs and limited price rises (in light of a competitive strategy) compressing margins.
                     Our SOTP-based price target change is also driven by an 2013e EV/EBITDA multiple of 8.5x (8.0x previously). In addition, we
                     apply EV/EBITDA multiples of 7.8x to gas separation (previously 7.5x) and petrochemicals (previously 6.5x). We assign a 6.0x
       PTT           EV/EBITDA multiple to the oil marketing business (unchanged), in line with global peers. We continue to apply a 15% holding
                     company discount to the value the parts, for which we use our Morgan Stanley price targets where appropriate.

                     Our price target of Bt83/share is based on an EV/EBITDA multiple approach. We use the comparable EV/EBITDA multiple of 7.5x
                     for petrochemicals and 6.0x for refining/aromatics. Multiples are based on global peer averages because product margins tend to
     PTTGC           move inline with peers. We base our earnings estimates on a US$105/bbl crude oil price for 2013.


                     Price target of S$2.15/shr is derived by applying a target dividend yield of 5.5% – half a standard deviation below the long-run
                     average of 6.0% – to our estimated 4Q13 annualized dividend/share of 9.8c. We believe a sustained low interest rate environment
                     and compressing cap rates support REIT dividend yield compression below the historical average. From the S$1.8 base value, we
                     also make an adjustment to account for the value accretion from Suntec Mall’s enhancement post 4Q13 of S$0.4 (=2c/5.5%). In
 Suntec REIT         line with the other S-REITs we cover, our bear-case target dividend yield of 6.5% is based on one standard deviation above the
                     long-run average, and our bull-case target dividend yield of 5.0% is based on one standard deviation below the long-run average.
                     We use a target dividend yield method to value REITs at different points of the cap rate cycle, whilst avoiding the sensitivity of
                     discount rate and long-term growth assumptions inherent in DDM and DCF models.



Source: Morgan Stanley Research




                                                                                                                  36
MORGAN        STANLEY   RESEARCH

May 4, 2013                             MORGAN STANLEY RESEARCH
ASEAN Equity Strategy                                     May 3, 2013
                                                 ASEAN Equity Strategy




      Annexure




                                   37
                                                               MORGAN        STANLEY         RESEARCH

                                                               May 4, 2013                                        MORGAN STANLEY RESEARCH
                                                               ASEAN Equity Strategy                                                 May 3, 2013
                                                                                                                            ASEAN Equity Strategy




Sector Performance – INDONESIA

                                                            Absolute Performance                                     Rank
              MSCI Sector
                                              1W         1M          6M        12M                YTD   1W    1M       6M     12M       YTD
  Consumer Discretionary                      -2%        -8%            -9%             -7%       -5%   7     9        7       7          8
  Consumer Staples                             2%         1%           13%             18%        15%   2     6        6       6          6
  Energy                                      -5%        -7%           -13%            -43%      -14%   9     8        9       9          9
  Financials                                  -1%         2%           25%             27%        24%   6     5        3       4          3
  Health Care                                 -1%         6%           35%             59%        26%   3     2        1       1          2
  Industrials                                 -3%        -2%           -10%            -35%       -3%   8     7        8       8          7
  Materials                                    5%         8%           22%             33%        18%   1     1        4       3          5
  Telecommunication Services                  -1%         5%           13%             25%        20%   5     4        5       5          4
  Utilities                                   -1%         6%           32%             57%        31%   4     3        2       2          1

                                                    Performance relative to MSCI Indonesia                           Rank
             MSCI Sector
                                              1W          1M          6M          12M             YTD   1W    1M       6M     12M       YTD
 Consumer Discretionary                       -1%        -9%        -21%         -19%            -18%    7     9        7      7         8
 Consumer Staples                              3%        0%           1%           6%             1%     2     6        6      6         6
 Energy                                       -4%        -8%        -25%         -55%            -27%    9     8        9      9         9
 Financials                                   -1%        1%          13%          15%            11%     6     5        3      4         3
 Health Care                                   0%        6%          23%          48%            12%     3     2        1      1         2
 Industrials                                  -2%        -3%        -22%         -47%            -17%    8     7        8      8         7
 Materials                                     6%        7%           9%          21%             4%     1     1        4      3         5
 Telecommunication Services                   -1%        4%             1%             14%         6%   5     4        5        5         4
 Utilities                                     0%        5%            20%             45%        18%   4     3        2        2         1


Source: Datastream, Morgan Stanley Research




                                                                                                             38
                                                                       MORGAN        STANLEY           RESEARCH

                                                                       May 4, 2013                                              MORGAN STANLEY RESEARCH
                                                                       ASEAN Equity Strategy                                                               May 3, 2013
                                                                                                                                                  ASEAN Equity Strategy




Sector Performance – SINGAPORE

                                                                    Absolute Performance                                                Rank
               MSCI Sector
                                                  1W              1M         6M        12M                  YTD    1W       1M            6M         12M       YTD
  Consumer Discretionary                         3.7%             1%             11%              0%         9%    3            4         3           6         3
  Consumer Staples                               -2.9%           -6%             -7%            -31%        -7%    7            7         7           7         7
  Banks*                                         4.7%             7%             21%             20%        13%    1            2         2           3         2
  Real Estate*                                   2.0%             5%              9%             28%         2%    4            3         5           1         5
  Diversified Financials*                        -0.3%           -2%             11%             11%         6%    5            5         4           4         4
  Industrials                                    -0.7%           -4%              0%              4%        -2%    6            6         6           5         6
  Telecommunication Services                     4.1%            11%             22%             28%        18%    2            1         1           2         1




             MSCI Sector                                  Performance relative to MSCI Singapore                                         Rank
                                                 1W             1M          6M          12M                 YTD    1W           1M         6M          12M       YTD
Consumer Discretionary                          1.2%           -2%          0%         -12%                 2%      3            4          3           6         3
Consumer Staples                                -5.4%            -9%            -18%            -43%        -13%       7            7         7           7         7
Banks*                                           2.2%             4%             10%              8%          6%       1            2         2           3         2
Real Estate*                                    -0.4%             2%             -2%             16%         -5%       4            3         5           1         5
Diversified Financials*                         -2.7%            -5%             -1%             -1%         -1%       5            5         4           4         4
Industrials                                     -3.1%            -7%            -12%             -8%         -9%       6            6         6           5         6
Telecommunication Services                       1.7%             8%             11%             16%        12%        2            1         1           2         1




Source: Datastream, Morgan Stanley Research
* Banks, Real Estate and Diversified Financials Industry Group together represents Financials Sector




                                                                                                                           39
                                                              MORGAN         STANLEY         RESEARCH

                                                              May 4, 2013                                          MORGAN STANLEY RESEARCH
                                                              ASEAN Equity Strategy                                                     May 3, 2013
                                                                                                                               ASEAN Equity Strategy




Sector Performance – THAILAND
                                                          Absolute Performance                                         Rank
             MSCI Sector
                                              1W        1M         6M        12M                 YTD     1W   1M         6M      12M       YTD
 Consumer Discretionary                        7%       8%            22%             39%         1%     2     3         3        2         8
 Consumer Staples                              0%      -4%             8%              6%         4%     4     9         6        6         6
 Energy                                        2%       1%             1%             -9%        -1%     3     5         7        7         9
 Financials                                   -2%       1%            24%             30%        13%     7     7         2        3         4
 Health Care                                  -3%       2%            N.A.            N.A.       53%     9     4        N.A.     N.A.       2
 Industrials                                  10%      20%            N.A.            N.A.       58%     1     1        N.A.     N.A.       1
 Materials                                     0%       1%            18%             10%         9%     5     6         4        5         5
 Telecommunication Services                   -2%      11%            50%             54%        33%     8     2         1        1         3
 Utilities                                     0%      -4%            10%             20%         2%     6     8         5        4         7




                                                    Performance relative to MSCI Thailand                              Rank
              MSCI Sector
                                              1W          1M          6M         12M               YTD   1W    1M        6M       12M       YTD
  Consumer Discretionary                       7%         6%          3%         22%              -10%    2     3         3        2         8
  Consumer Staples                             1%        -5%        -11%        -11%               -7%    4     9         6        6         6
  Energy                                       2%        -1%        -17%        -26%              -11%    3     5         7        7         9
  Financials                                  -1%        -1%         6%          13%                2%    7     7         2        3         4
  Health Care                                 -2%         1%         N.A.        N.A.             42%     9     4       N.A.      N.A.       2
  Industrials                                 10%       18%          N.A.        N.A.              47%    1     1       N.A.      N.A.       1
  Materials                                    0%        -1%         -1%         -7%               -2%    5     6         4        5         5
  Telecommunication Services                  -2%       10%            31%            37%         22%     8        2      1         1           3
  Utilities                                   0%        -5%            -9%             4%         -9%     6        8      5         4           7




Source: Datastream, Morgan Stanley Research




                                                                                                              40
                                                                     MORGAN        STANLEY      RESEARCH

                                                                     May 4, 2013                                                   MORGAN STANLEY RESEARCH
                                                                     ASEAN Equity Strategy                                                                May 3, 2013
                                                                                                                                                 ASEAN Equity Strategy



Valuation Summary
       2-May-13                                 PE                                       EPS Growth                             Performance in USD
                               12M                                                                         13-14
  Country / Region                       2013E      2014E      2015E        2013E       2014E     2015E                 1W          4W           52W        YTD
                               Fwd                                                                         CAGR
MSCI AC Asia ex JP              11.0       11.4       10.2           9.0     18.2%       12.0%    10.1%    15.1%         1.1%        2.5%          5.7%       0.6%
MSCI Indonesia                  15.1       15.9       13.7          12.0     16.4%       16.4%    13.9%    16.4%        -0.7%        1.8%         11.8%      13.6%
MSCI Malaysia                   14.6       15.2       13.9          12.8      1.1%        9.7%     9.9%     5.3%        -0.2%        1.8%          5.4%       2.1%
MSCI Philippines                20.5       20.5       19.0          17.8      9.7%       12.3%    12.9%    11.0%         1.9%        4.4%         38.7%      21.3%
MSCI Singapore                  14.1       14.5       13.3          12.0      1.7%        9.2%     9.6%     5.4%         2.5%        3.4%         12.4%       6.2%
MSCI Thailand                   12.3       12.8       11.4          10.3     19.1%       12.6%    10.1%    15.8%        -0.2%        2.1%         16.9%      10.8%
MSCI India                      13.5       13.7       11.9          10.3     13.3%       15.6%    15.2%    14.4%         2.3%        8.4%         14.2%       1.9%
MSCI China                       8.8        9.1        8.2           7.4     11.7%       10.5%    11.2%    11.1%         0.9%        1.6%          0.3%      -3.9%


       2-May-13                          PBV                                          ROE                          DY                            Payout
                             12W
  Country / Region                 2013E 2014E               2015E         2013E     2014E      2015E     2013E    2014E 2015E       2013E        2014E    2015E
                             Fwd
MSCI AC Asia ex JP             1.4    1.4    1.3                    1.2    12.7%       13.0%     13.0%      2.7%    3.0%     3.3%        30.8%     30.1%     29.4%
MSCI Indonesia                 3.3    3.4    3.0                    2.6    21.6%       21.8%     21.4%      2.5%    2.8%     3.3%        39.2%     38.7%     39.6%
MSCI Malaysia                  1.9    2.0    1.8                    1.7    13.1%       13.3%     13.4%      3.3%    3.5%     3.6%        50.5%     49.0%     45.7%
MSCI Philippines               3.3    3.1    3.1                    2.8    15.3%       16.2%     15.9%      1.9%    2.1%     2.5%        39.8%     40.3%     44.8%
MSCI Singapore                 1.4    1.4    1.4                    1.2     9.9%       10.2%     10.3%      3.5%    3.7%     3.7%        50.4%     48.6%     44.7%
MSCI Thailand                  2.1    2.2    2.0                    1.8    17.2%       17.4%     17.2%      3.3%    3.8%     4.2%        42.8%     42.9%     43.3%
MSCI India                     2.1    2.1    1.9                    1.6    15.5%       15.9%     15.2%      1.7%    1.9%     2.3%        23.2%     22.7%     23.4%
MSCI China                     1.3    1.3    1.2                    1.1    14.6%       14.5%     14.4%      3.5%    3.8%     4.2%        31.8%     31.4%     31.3%




  Source: DataStream, IBES, Morgan Stanley Research (E) estimates




                                                                                                                              41
           MORGAN STANLEY RESEARCH


                                     ASEAN Equity Strategy
                                              May 3, 2013




                                                                                                                                                                                                                                                                                           Jan-13
                                                                                                                                                                                 Jan-13
                                                                                                                                                                                 Sep-12                                                                                                    Jul-12
                                                                                                                                                                                 May-12
                                                                                                                                                                                                                              15.4


                                                                                                                                                                                                                                            14.2



                                                                                                                                                                                                                                                                12.9
                                                                                                                               11.7




                                                                                                                                                                                 Jan-12                                                                                                    Jan-12
                                                                                                                                                          9.2
                                                                                                                                            10.5




                                                                                                                                                                                 Sep-11
                                                                                                                                                                                                                                                                                           Jul-11
                                                                                                                                                                                 May-11
                                                                                                                                                                                 Jan-11                                                                                                    Jan-11
                                                                                                                                                                                              MSCI Malaysia 12M Fwd PE
                                                                                               MSCI Thailand 12M Fwd PE




                                                                                                                                                                                 Sep-10
                                                                                                                                                                                                                                                                                           Jul-10
                                                                                                                                                                                 May-10
                                                                                                                                                                                 Jan-10                                                                                                    Jan-10
                                                                                                                                                                                                                                                                                                                                                         42
                                                                                                                                                                                 Sep-09
                                                                                                                                                                                                                                                                                           Jul-09
                                                                                                                                                                                 May-09
                                                                                                                                                                                 Jan-09                                                                                                    Jan-09
                                                                                                                                                                                 Sep-08
                                                                                                                                                                                                                                                                                           Jul-08
                                                                                                                                                                                 May-08
                                                                                                                                                                                 Jan-08                                                                                                    Jan-08
                                                                                                                                                                                 Sep-07
RESEARCH




                                                                                                                                                                                                                                                                                           Jul-07
                                                                                                                                                                                 May-07
                                                                                                                                                                                 Jan-07                                                                                                    Jan-07
                                                                                                                                                                                 Sep-06
                                                                                                                                                                                                                                                                                           Jul-06
                                                                                                                                                                                 May-06
                                                                                                                                                                                 Jan-06
STANLEY




                                                                                                                                                                                                                                                                                           Jan-06
                                                                                          14

                                                                                                                          13

                                                                                                                                  12

                                                                                                                                        11

                                                                                                                                                   10

                                                                                                                                                          9

                                                                                                                                                                 8

                                                                                                                                                                     7

                                                                                                                                                                         6

                                                                                                                                                                             5




                                                                                                                                                                                          18

                                                                                                                                                                                                                         17

                                                                                                                                                                                                                              16

                                                                                                                                                                                                                                       15

                                                                                                                                                                                                                                                   14

                                                                                                                                                                                                                                                           13

                                                                                                                                                                                                                                                                  12

                                                                                                                                                                                                                                                                            11

                                                                                                                                                                                                                                                                                  10

                                                                                                                                                                                                                                                                                       9
                ASEAN Equity Strategy
MORGAN




                                                                                                                                                                                 Jan-13                                                                                                     Jan-13
                May 4, 2013




                                                                                                                                                                                 Sep-12                                                                                                     Sep-12
                                                                                                                                                                                 May-12                                                                                                     May-12
                                                                                                                               14.5



                                                                                                                                                   12.6

                                                                                                                                                          10.7




                                                                                                                                                                                                                                     15.5


                                                                                                                                                                                                                                                    13.8



                                                                                                                                                                                                                                                                        12.1
                                                                                                                                                                                 Jan-12                                                                                                     Jan-12
                                                                                                                                                                                 Sep-11                                                                                                     Sep-11
                                                                                                                                                                                 May-11                                                                                                     May-11
                                                                                                                                                                                 Jan-11                                                                                                     Jan-11
                                                                                           MSCI Indonesia 12M Fwd PE




                                                                                                                                                                                           MSCI Singapore 12M Fwd PE
                                                             12-Month Forward P/E Trend




                                                                                                                                                                                 Sep-10                                                                                                     Sep-10




                                                                                                                                                                                                                                                                                                     Source: DataStream, IBES, Morgan Stanley Research
                                                                                                                                                                                 May-10                                                                                                     May-10
                                                                                                                                                                                 Jan-10                                                                                                     Jan-10
                                                                                                                                                                                 Sep-09                                                                                                     Sep-09
                                                                                                                                                                                 May-09                                                                                                     May-09
                                                                                                                                                                                 Jan-09                                                                                                     Jan-09
                                                                                                                                                                                 Sep-08                                                                                                     Sep-08
                                                                                                                                                                                 May-08                                                                                                     May-08
                                                                                                                                                                                 Jan-08                                                                                                     Jan-08
                                                                                                                                                                                 Sep-07                                                                                                     Sep-07
                                                                                                                                                                                 May-07                                                                                                     May-07
                                                                                                                                                                                 Jan-07                                                                                                     Jan-07
                                                                                                                                                                                 Sep-06                                                                                                     Sep-06
                                                                                                                                                                                 May-06                                                                                                     May-06
                                                                                                                                                                                 Jan-06                                                                                                     Jan-06




                                                                                                                                                                                          20


                                                                                                                                                                                                                          18


                                                                                                                                                                                                                                       16


                                                                                                                                                                                                                                                        14


                                                                                                                                                                                                                                                                       12


                                                                                                                                                                                                                                                                                 10


                                                                                                                                                                                                                                                                                       8
                                                                                          18

                                                                                                                          16

                                                                                                                                       14

                                                                                                                                                   12

                                                                                                                                                          10

                                                                                                                                                                 8

                                                                                                                                                                         6

                                                                                                                                                                             4
                                                                                                                                     MORGAN                       STANLEY         RESEARCH

                                                                                                                                     May 4, 2013                                                                                                                MORGAN STANLEY RESEARCH
                                                                                                                                     ASEAN Equity Strategy                                                                                                                                                May 3, 2013
                                                                                                                                                                                                                                                                                                 ASEAN Equity Strategy



12-Month Forward P/B Trend
  5.0                                                                                                                                                                  2.4
                                                      MSCI Indonesia 12M Fwd PB                                                                                                                         MSCI Thailand 12M Fwd PB
  4.5                                                                                                                                                                  2.2
                                                                                                                                                                                                                                                                                                    2.0
  4.0                                                                                                                                                                  2.0
                                                                                                                                       3.6
  3.5                                                                                                                                                                  1.8
                                                                                                                                       3.1
                                                                                                                                                                                                                                                                                                    1.7
  3.0                                                                                                                                                                  1.6
                                                                                                                                                                                                                                                                                                    1.5
  2.5                                                                                                                                                                  1.4
                                                                                                                                       2.6
  2.0                                                                                                                                                                  1.2

  1.5                                                                                                                                                                  1.0

  1.0                                                                                                                                                                  0.8
         Jan-06

                    Jul-06

                               Jan-07

                                          Jul-07

                                                     Jan-08

                                                                Jul-08

                                                                          Jan-09

                                                                                    Jul-09

                                                                                              Jan-10

                                                                                                        Jul-10

                                                                                                                  Jan-11

                                                                                                                            Jul-11

                                                                                                                                     Jan-12

                                                                                                                                              Jul-12

                                                                                                                                                         Jan-13




                                                                                                                                                                             Jan-06

                                                                                                                                                                                      Jul-06

                                                                                                                                                                                               Jan-07

                                                                                                                                                                                                         Jul-07

                                                                                                                                                                                                                  Jan-08

                                                                                                                                                                                                                             Jul-08

                                                                                                                                                                                                                                      Jan-09

                                                                                                                                                                                                                                               Jul-09

                                                                                                                                                                                                                                                             Jan-10

                                                                                                                                                                                                                                                                      Jul-10

                                                                                                                                                                                                                                                                               Jan-11

                                                                                                                                                                                                                                                                                        Jul-11

                                                                                                                                                                                                                                                                                                   Jan-12

                                                                                                                                                                                                                                                                                                            Jul-12

                                                                                                                                                                                                                                                                                                                     Jan-13
 2.6                                                                                                                                                                   2.6
                                                       MSCI Singapore 12M Fwd PB                                                                                                                                           MSCI Malaysia 12M Fwd PB
 2.4
                                                                                                                                                                       2.4
 2.2

 2.0                                                                                                                                                                   2.2                                                                                                                          2.1
                                                                                                                                      1.9
 1.8                                                                                                                                                                   2.0                                                                                                                                           1.9

 1.6
                                                                                                                                      1.6                              1.8
 1.4
                                                                                                                                                                       1.6                                                                                                                          1.7
 1.2
                                                                                                                                                       1.3
 1.0                                                                                                                                                                   1.4

 0.8                                                                                                                                                                   1.2
       Jan-06

                  Jul-06

                             Jan-07

                                        Jul-07

                                                   Jan-08

                                                              Jul-08

                                                                         Jan-09

                                                                                   Jul-09

                                                                                             Jan-10

                                                                                                       Jul-10

                                                                                                                 Jan-11

                                                                                                                           Jul-11

                                                                                                                                     Jan-12

                                                                                                                                              Jul-12

                                                                                                                                                         Jan-13




                                                                                                                                                                             Jan-06

                                                                                                                                                                                      Jul-06

                                                                                                                                                                                               Jan-07

                                                                                                                                                                                                         Jul-07

                                                                                                                                                                                                                  Jan-08

                                                                                                                                                                                                                             Jul-08

                                                                                                                                                                                                                                      Jan-09

                                                                                                                                                                                                                                               Jul-09

                                                                                                                                                                                                                                                         Jan-10

                                                                                                                                                                                                                                                                      Jul-10

                                                                                                                                                                                                                                                                               Jan-11

                                                                                                                                                                                                                                                                                        Jul-11

                                                                                                                                                                                                                                                                                                   Jan-12

                                                                                                                                                                                                                                                                                                            Jul-12

                                                                                                                                                                                                                                                                                                                     Jan-13
Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                                        43
                                                                                                                                         MORGAN                         STANLEY    RESEARCH

                                                                                                                                         May 4, 2013                                                                                                           MORGAN STANLEY RESEARCH
                                                                                                                                         ASEAN Equity Strategy                                                                                                                                         May 3, 2013
                                                                                                                                                                                                                                                                                              ASEAN Equity Strategy



Valuations Relative Against Region
   50%                                                                                                                                                                        20%
                   MSCI Indonesia 12M Fwd PE Premium / Discount Against                                                                                                                            MSCI Thailand 12M Fwd PE Premium / Discount Against
   40%                                  MSCI AxJ                                                                                                                                                                       MSCI AxJ
                                                                                                                                                                              10%
   30%
   20%                                                                                                                                                                         0%

   10%                                                                                                                                                                       -10%
    0%
                                                                                                                                                                             -20%
  -10%
  -20%                                                                                                                                                                       -30%
  -30%
                                                                                                                                                                             -40%
  -40%
  -50%                                                                                                                                                                       -50%




                                                                                                                                                                                       Jan-06

                                                                                                                                                                                                Jul-06

                                                                                                                                                                                                         Jan-07

                                                                                                                                                                                                                  Jul-07

                                                                                                                                                                                                                           Jan-08

                                                                                                                                                                                                                                    Jul-08

                                                                                                                                                                                                                                             Jan-09

                                                                                                                                                                                                                                                      Jul-09

                                                                                                                                                                                                                                                               Jan-10

                                                                                                                                                                                                                                                                        Jul-10

                                                                                                                                                                                                                                                                                 Jan-11

                                                                                                                                                                                                                                                                                          Jul-11

                                                                                                                                                                                                                                                                                                   Jan-12

                                                                                                                                                                                                                                                                                                             Jul-12

                                                                                                                                                                                                                                                                                                                       Jan-13
          Jan-06

                    Jul-06

                              Jan-07

                                        Jul-07

                                                   Jan-08

                                                              Jul-08

                                                                         Jan-09

                                                                                    Jul-09

                                                                                               Jan-10

                                                                                                          Jul-10

                                                                                                                     Jan-11

                                                                                                                                Jul-11

                                                                                                                                           Jan-12

                                                                                                                                                      Jul-12

                                                                                                                                                                  Jan-13
  35%                                                                                                                                                                         50%
                    MSCI Singapore 12M Fwd PE Premium / Discount Against                                                                                                                           MSCI Malaysia 12M Fwd PE Premium / Discount Against
  30%                                    MSCI AxJ                                                                                                                                                                      MSCI AxJ
  25%                                                                                                                                                                         40%

  20%
                                                                                                                                                                              30%
  15%
  10%
                                                                                                                                                                              20%
   5%
   0%                                                                                                                                                                         10%
   -5%
  -10%                                                                                                                                                                            0%
  -15%
  -20%                                                                                                                                                                        -10%
                                                                                                                                                                                       Jan-06

                                                                                                                                                                                                Jul-06

                                                                                                                                                                                                         Jan-07

                                                                                                                                                                                                                  Jul-07

                                                                                                                                                                                                                           Jan-08

                                                                                                                                                                                                                                    Jul-08

                                                                                                                                                                                                                                             Jan-09

                                                                                                                                                                                                                                                      Jul-09

                                                                                                                                                                                                                                                               Jan-10

                                                                                                                                                                                                                                                                        Jul-10

                                                                                                                                                                                                                                                                                 Jan-11

                                                                                                                                                                                                                                                                                          Jul-11

                                                                                                                                                                                                                                                                                                    Jan-12

                                                                                                                                                                                                                                                                                                              Jul-12

                                                                                                                                                                                                                                                                                                                        Jan-13
         Jan-06

                   Jul-06

                             Jan-07

                                       Jul-07

                                                 Jan-08

                                                            Jul-08

                                                                       Jan-09

                                                                                  Jul-09

                                                                                             Jan-10

                                                                                                        Jul-10

                                                                                                                   Jan-11

                                                                                                                              Jul-11

                                                                                                                                         Jan-12

                                                                                                                                                    Jul-12

                                                                                                                                                               Jan-13




Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                                       44
                                                                                                                                  MORGAN                     STANLEY   RESEARCH

                                                                                                                                  May 4, 2013                                                                                                     MORGAN STANLEY RESEARCH
                                                                                                                                  ASEAN Equity Strategy                                                                                                                                   May 3, 2013
                                                                                                                                                                                                                                                                                 ASEAN Equity Strategy



Valuations Relative Against Region
 140%                                                                                                                                                              60%
                  MSCI Indonesia 12M Fwd PB Premium / Discount Against                                                                                                                MSCI Thailand 12M Fwd PB Premium / Discount Against
                                       MSCI AxJ                                                                                                                    50%                                    MSCI AxJ
 120%
                                                                                                                                                                   40%

 100%                                                                                                                                                              30%

                                                                                                                                                                   20%
 80%
                                                                                                                                                                   10%

 60%                                                                                                                                                               0%

                                                                                                                                                                  -10%
 40%
                                                                                                                                                                  -20%

 20%                                                                                                                                                              -30%




                                                                                                                                                                         Jan-06

                                                                                                                                                                                  Jul-06

                                                                                                                                                                                           Jan-07

                                                                                                                                                                                                    Jul-07

                                                                                                                                                                                                             Jan-08

                                                                                                                                                                                                                      Jul-08

                                                                                                                                                                                                                               Jan-09

                                                                                                                                                                                                                                        Jul-09

                                                                                                                                                                                                                                                 Jan-10

                                                                                                                                                                                                                                                          Jul-10

                                                                                                                                                                                                                                                                   Jan-11

                                                                                                                                                                                                                                                                            Jul-11

                                                                                                                                                                                                                                                                                     Jan-12

                                                                                                                                                                                                                                                                                              Jul-12

                                                                                                                                                                                                                                                                                                       Jan-13
        Jan-06

                  Jul-06

                            Jan-07

                                      Jul-07

                                                Jan-08

                                                          Jul-08

                                                                    Jan-09

                                                                              Jul-09

                                                                                        Jan-10

                                                                                                  Jul-10

                                                                                                            Jan-11

                                                                                                                      Jul-11

                                                                                                                                Jan-12

                                                                                                                                          Jul-12

                                                                                                                                                    Jan-13
 15%                                                                                                                                                              60%
                  MSCI Singapore 12M Fwd PB Premium / Discount Against                                                                                                               MSCI Malaysia 12M Fwd PB Premium / Discount Against
                                       MSCI AxJ                                                                                                                   50%                                    MSCI AxJ
 10%

                                                                                                                                                                  40%
  5%
                                                                                                                                                                  30%
  0%
                                                                                                                                                                  20%
 -5%
                                                                                                                                                                  10%
 -10%
                                                                                                                                                                   0%

 -15%                                                                                                                                                             -10%

 -20%                                                                                                                                                             -20%
                                                                                                                                                                         Jan-06

                                                                                                                                                                                  Jul-06

                                                                                                                                                                                           Jan-07

                                                                                                                                                                                                    Jul-07

                                                                                                                                                                                                             Jan-08

                                                                                                                                                                                                                      Jul-08

                                                                                                                                                                                                                               Jan-09

                                                                                                                                                                                                                                        Jul-09

                                                                                                                                                                                                                                                 Jan-10

                                                                                                                                                                                                                                                          Jul-10

                                                                                                                                                                                                                                                                   Jan-11

                                                                                                                                                                                                                                                                            Jul-11

                                                                                                                                                                                                                                                                                     Jan-12

                                                                                                                                                                                                                                                                                              Jul-12

                                                                                                                                                                                                                                                                                                       Jan-13
        Jan-06

                 Jul-06

                           Jan-07

                                     Jul-07

                                               Jan-08

                                                         Jul-08

                                                                   Jan-09

                                                                             Jul-09

                                                                                       Jan-10

                                                                                                 Jul-10

                                                                                                           Jan-11

                                                                                                                     Jul-11

                                                                                                                               Jan-12

                                                                                                                                         Jul-12

                                                                                                                                                   Jan-13




Source: DataStream, IBES, Morgan Stanley Research




                                                                                                                                                                                                                                           45
                                                                                 MORGAN           STANLEY         RESEARCH

                                                                                 May 4, 2013                                                                 MORGAN STANLEY RESEARCH
                                                                                 ASEAN Equity Strategy                                                                                 May 3, 2013
                                                                                                                                                                              ASEAN Equity Strategy



Historical Focus List since Inception
                                                                                                                                                                          Performance Since Addition
                                                                                                       Price (Local Ccy)              Country MSCI Index (Local Ccy)
                                                                                                                                                                            To Current or Removal
                                                                               Date
  Ticker                    Company name                     Date Added
                                                                             Removed                                                                                                      Relative To
                                                                                              When         When                       When        When
                                                                                                                           Current                            Current       Absolute       Country
                                                                                              Added       Removed                     Added      Removed
                                                                                                                                                                                            MSCI

                                                                                                  INDONESIA
BBRI.JK      Bank Rakyat Indonesia                              24-Jan-11                        4,875                        9,350     4,039                    5,949            91.8%        30.2%
BMRI.JK      Bank Mandiri                                       14-Jun-11                        6,950                       10,150     4,648                    5,949            46.0%        14.1%
SMGR.JK      Semen Indonesia                                    16-Oct-11                        8,950                       18,950     4,574                    5,949           111.7%        62.8%
KLBF.JK      Kalbe Farma                                         5-May-13                        1,350                        1,350     5,949                    5,949             0.0%         0.0%
PGAS.JK      Perusahaan Gas Negara Persero Tbk PT               31-Oct-11                        2,950                        6,100     4,774                    5,949           106.8%        65.9%
UNVR.JK      Unilever Indonesia Tbk PT                           3-Jan-13                       22,100                       25,250     5,259                    5,949            14.3%         1.0%
ISAT.JK      Indosat Tbk PT                                      3-Jan-13                        6,550                        5,850     5,259                    5,949           -10.7%       -21.0%
CTRA.JK      Ciputra Development Tbk PT                          3-May-13                        1,350                        1,350     5,949                    5,949             0.0%         0.0%
SMRA.JK      Summarecon Agung                                   26-Feb-13       2-May-13         2,200                        2,700     5,653                    5,949            22.7%        16.6%
AALI.JK      Astra Agro Lestari Tbk PT                          18-Sep-12      29-Mar-13        22,300      18,500           17,550     5,092        5,913       5,949           -17.0%       -28.6%
CPIN.JK      PT Charoen Pokphand Indonesia Tbk                  16-Oct-11      26-Feb-13         2,625       4,625            4,850     4,574        5,653       5,949            76.2%        42.6%
TLKM.JK      Telekomunikasi                                      11-Jul-11      3-Jan-13         7,050       9,000           11,800     4,977        5,259       5,949            27.7%        20.8%
KLBF.JK      Kalbe Farma                                        16-Jun-11      28-Sep-12            665        940            1,350     4,613        5,107       5,949            41.4%        27.7%
INTP.JK      Indocement Tunggal Prakarsa                        16-Dec-10       3-Sep-12        15,700      20,100           26,500     4,376        4,913       5,949            28.0%        14.0%
BBNI.JK      Bank Negara Indonesia                              14-Jun-11      16-Jan-12         3,700       3,700            5,350     4,648        4,854       5,949             0.0%        -4.2%
ASII.JK      PT Astra International Tbk                         14-Jun-11      27-Apr-12         5,735       7,070            7,200     4,648        4,960       5,949            23.3%        15.5%
UNTR.JK      PT United Tractor Tbk                              28-Oct-10      27-Apr-12        21,055      29,750           17,850     4,675        4,960       5,949            41.3%        33.2%
ADRO.JK      Adaro                                              18-Aug-11      27-Apr-12         2,400       1,810            1,200     5,007        4,960       5,949           -24.6%       -23.9%
ANTM.JK      PT Aneka Tambang Persero Tbk                       29-Aug-11      27-Apr-12         1,880       1,720            1,350     4,720        4,960       5,949            -8.5%       -12.9%
ICBP.JK      Indofood CBP Sukses Makmur                         28-Oct-10      31-Oct-11         5,750       5,300           12,100     4,675        4,774       5,949            -7.8%        -9.7%
ITMG.JK      Indo Tambangraya Megah                             28-Oct-10      18-Aug-11        46,400      45,650           35,500     4,675        5,007       5,949            -1.6%        -8.1%
BORN.JK      Borneo Lumbung Energi Metal                         5-Jan-11      18-Aug-11         1,700       1,280              435     4,648        5,007       5,949           -24.7%       -30.1%
ISAT.JK      Indosat                                            14-Jun-11       11-Jul-11        5,100       5,200            5,850     4,648        4,977       5,949             2.0%        -4.8%
TLKM.JK      Telekomunikasi                                     28-Oct-10      14-Jun-11         9,250       7,300           11,800     4,675        4,648       5,949           -21.1%       -20.6%
PGAS.JK      Perusahaan Gas Negara                              28-Oct-10      14-Jun-11         4,075       3,975            6,100     4,675        4,648       5,949            -2.5%        -1.9%
INCO.JK      Vale Indonesia                                     28-Oct-10      14-Jun-11         4,850       4,575            2,700     4,675        4,648       5,949            -5.7%        -5.1%
                                                                                                   THAILAND
CPALL.BK     C P All                                            25-Mar-13                          45.0                        41.5       527                      550            -7.8%       -11.7%
BAY.BK       Bank of Ayudhya                                    25-Mar-13                          33.5                        32.8       527                      550            -2.2%        -6.4%
KBAN.BK      Kasikorn Bank Public Company                        27-Apr-12                       155.0                        211.0       479                      550            36.1%        18.6%
PTTGC.BK     PTT Global Chemicals                                 3-Sep-12                         61.3                        72.3       469                      550            18.0%         0.6%
IRPC.BK      IRPC PCL                                           18-Sep-12                          4.32                         4.0       485                      550            -6.9%       -17.9%
PTT.BK       PTT Public Company                                   3-Jan-13                       337.0                        327.0       520                      550            -3.0%        -8.2%
BBL.BK       Bangkok Bank Public Company Limited                25-May-11      22-Mar-13         161.0       210.0            222.0       426         515          550            30.4%         8.0%
MINT.BK      Minor International                                 27-Apr-12     22-Mar-13           13.9       23.3             24.8       479         515          550            67.6%        55.9%
CPALL.BK     C P All                                            25-May-11       2-Jan-13           23.3       45.8             41.5       426         521          550            96.8%        60.9%
TRUE.BK      True Corporation                                    27-Apr-12      5-Jun-12           3.70       3.44              8.6       479          425         550            -7.0%         4.7%
PTT.BK       PTT Public Company                                 25-May-11      28-Sep-12         348.0      329.00            327.0       426          490         550            -5.5%       -17.9%
BIGC.BK      Big C Supercenter PCL                              29-Aug-11      27-Apr-12         127.5       190.0            233.0       414         479          550            49.0%        28.8%
SCC.BK       Siam Cement PCL                                    16-Jan-12      27-Apr-12         318.0       346.0            486.0       407         479          550             8.8%        -7.5%
TOP.BK       Thai Oil PCL                                       25-May-11      16-Jan-12           75.5       59.3             65.5       426         407          550           -21.5%       -17.9%
PTTGC.BK     PTT Global Chemical PCL                             21-Oct-11     16-Jan-12           54.0       60.8             72.3       369         407          550            12.5%         1.9%
PTTAR.BK     PTT Aromatics & Refining PCL                       25-May-11      21-Oct-11           37.0        26.5            N.A.        426        369           410          -28.4%       -17.2%


 Source: DataStream, Morgan Stanley Research, closing price May 2, 2013
 Past performance is no guarantee of future results. Results shown do not include transaction costs.




                                                                                                                                                       46
                                                                                 MORGAN           STANLEY        RESEARCH

                                                                                 May 4, 2013                                                                  MORGAN STANLEY RESEARCH
                                                                                 ASEAN Equity Strategy                                                                                May 3, 2013
                                                                                                                                                                             ASEAN Equity Strategy



Historical Focus List Since Inception (Cont.)
                                                                                                                                                                          Performance Since Addition
                                                                                                       Price (Local Ccy)               Country MSCI Index (Local Ccy)
                                                                                                                                                                            To Current or Removal
                                                                                Date
  Ticker                    Company name                     Date Added
                                                                              Removed                                                                                                     Relative To
                                                                                              When         When                        When       When
                                                                                                                           Current                             Current      Absolute       Country
                                                                                              Added       Removed                      Added     Removed
                                                                                                                                                                                            MSCI

                                                                                                  SINGAPORE
CMAL.SI      CapitaMalls Asia                                   27-Apr-12                          1.53                        2.09      1,599                    1,799           36.2%        21.0%
STEL.SI      Singapore Telecom                                   7-Mar-11                          2.93                        3.93      1,678                    1,799           34.1%        25.1%
SUNT.SI      Suntec REIT                                         3-May-13                              2                           2     1,799                    1,799            0.0%         0.0%
KPLM.SI      Keppel Corporation                                 11-Oct-12                         10.98                       10.59      1,613                    1,799           -3.5%       -13.5%
SIAL.SI      Singapore Airlines                                  1-Mar-13                         10.81                       11.10      1,715                    1,799            2.7%        -2.1%
NOBG.SI      Noble Group                                         1-Mar-13                           1.17                       1.15      1,715                    1,799           -2.1%        -6.7%
FRLD.SI      First Resources                                    18-Sep-12       2-May-13               2                          2      1,646                    1,799          -21.3%       -28.0%
AEMN.SI      Ascendas Real Estate Investment Trust              28-Sep-12       1-Mar-13           2.41      2.60              2.69      1,637        1,715       1,799            7.9%         3.0%
WLIL.SI      Wilmar International                                4-Feb-13       1-Mar-13            3.85     3.51              3.30      1,730        1,715       1,799           -8.8%        -8.1%
GAGR.SI      Golden Agri-Resources                               1-Nov-12       3-Jan-13           0.61      0.65              0.52      1,594        1,703       1,799            6.5%        -0.3%
OLAM.SI      Olam International                                  7-Mar-11       3-Jan-13           2.72      1.70              1.67      1,678        1,703       1,799          -37.6%       -38.5%
CDLT.SI      CDL Hospitality Trust                              27-Apr-12       1-Nov-12           1.86      1.96              1.99      1,599        1,594       1,799            5.1%         5.4%
SCIL.SI      SembCorp Industries                                27-Apr-12      11-Oct-12           5.14      5.60              5.01      1,599        1,613       1,799            8.9%         8.0%
GLPL.SI      Global Logistic Properties                          5-Jun-12      28-Sep-12           2.03      2.51              2.77      1,448        1,637       1,799           23.6%         9.3%
WLIL.SI      Wilmar International                               27-Apr-12       1-Aug-12           4.86      3.26              3.30      1,599        1,638       1,799          -32.9%       -34.5%
DBSM.SI      DBS Group Holdings                                  7-Mar-11       1-Aug-12          14.34     14.81             17.52      1,678        1,638       1,799            3.3%         5.8%
OCBC.SI      Oversea-Chinese Banking Corp                       27-Apr-12       5-Jun-12           8.95      8.20             10.92      1,599        1,448       1,799           -8.4%         1.2%
SCMN.SI      SembCorp Marine                                    27-Apr-12       5-Jun-12           5.10      4.22              4.28      1,599        1,448       1,799          -17.3%        -8.6%
CMLT.SI      CapitaMall Trust                                   22-Dec-11      27-Apr-12           1.71      1.82              2.32      1,413        1,599       1,799            6.1%        -6.2%
MONE.SI      M1 Limited                                          7-Mar-11      27-Apr-12           2.41      2.44              3.36      1,678        1,599       1,799            1.2%         6.2%
AEMN.SI      Ascendas Real Estate Investment Trust              18-Aug-11      22-Dec-11            2.05     1.86              2.69      1,513        1,413       1,799           -9.0%        -2.6%
OLAM.SI      Olam International                                  7-Mar-11       1-Nov-11            2.72     2.47              1.67      1,678        1,479       1,799           -9.3%         2.9%
SIAL.SI      Singapore Airlines                                  7-Mar-11       1-Aug-11          13.50     14.32             11.10      1,678        1,740       1,799            6.1%         2.3%
OCBC.SI      Oversea-Chinese Banking Corp                        7-Mar-11      18-Aug-11            9.29     8.85             10.92      1,678        1,513       1,799           -4.7%         5.6%
KLAN.SI      Keppel Land                                         7-Mar-11      18-Aug-11            4.25     3.17              4.10      1,678        1,513       1,799          -25.4%       -17.3%
CDLT.SI      CDL Hospitality Trust                               7-Mar-11      18-Aug-11            2.00     1.73              1.99      1,678        1,513       1,799          -13.5%        -4.1%
KPLM.SI      Keppel Corporation                                  7-Mar-11      18-Aug-11          10.37      8.81             10.59      1,678        1,513       1,799          -15.0%        -5.8%
NEPS.SI      Neptune Orient Lines Ltd                            7-Mar-11      18-Aug-11            2.06     1.09              1.09      1,678        1,513       1,799          -47.1%       -41.3%




 Source: DataStream, Morgan Stanley Research, closing price May 2, 2013
 Past performance is no guarantee of future results. Results shown do not include transaction costs.




                                                                                                                                                       47
                                                                                                            MORGAN                STANLEY                 RESEARCH

                                                                                                            May 4, 2013                                                                                                     MORGAN STANLEY RESEARCH
                                                                                                            ASEAN Equity Strategy                                                                                                                          May 3, 2013
                                                                                                                                                                                                                                                  ASEAN Equity Strategy




 Valuation – Morgan Stanley Coverage Universe
                                                                                                                                           Avg Daily
                                                                                                                                 Price    Traded Vol.             MW EPS                      PE                    PB                     EV/EBITDA                   Div Yield
   Bbrg Ticker                       Name                       GICS Sector                   Analyst            MS Rating      (Local      in 6mth
                                                                                                                                 Ccy)
                                                                                                                                           USD mn       2012       2013     2014      2012    2013   2014   2012    2013    2014   2011    2012   2013   2014   2012     2013      2014


Indonesia
AALI IJ Equity     Astra Agro Lestari                   Consumer Staples             Spencer, Charles           Overweight      17,650             2    1,530.6   1,474.3   1,577.0    12.9   11.9   11.1     3.4     2.7    2.4     9.5    8.3    7.9    7.2   3.5%      4.2%     4.5%
ANTM IJ Equity     Aneka Tambang                        Materials                    Spencer, Charles           Equal-Weight      1,340            2      101.4     101.8     101.1    12.6   13.5   13.5     1.1     1.2    1.1     4.6    5.9    5.6    4.6   7.1%      3.7%     3.7%
BBCA IJ Equity     Bank Central Asia                    Financials                   Lord, Nick                 Underweight     10,750            12      480.9     562.1     652.8    18.9   19.1   16.5     4.3     4.2    3.5    15.7   16.1   16.0   13.9   1.3%      1.3%     1.5%
BBRI IJ Equity     Bank Rakyat Indonesia                Financials                   Lord, Nick                 Overweight        8,900           25      771.0     813.2     888.1     8.9   11.7   10.8     2.6     3.0    2.5     9.5    7.8   10.4    9.3   3.4%      2.6%     2.8%
BDMN IJ Equity     Bank Danamon Indonesia               Financials                   Lord, Nick                 ++                6,400            2      422.0     463.6     528.0    13.4   13.7   12.0     1.9     1.9    1.7     7.8    9.2    9.5    8.5   1.9%      2.0%     2.2%
BBNI IJ Equity     Bank Negara Indonesia                Financials                   Lord, Nick                 Equal-Weight      5,300           11      377.6     447.3     511.5     9.8   12.4   10.8     1.6     2.0    1.7    13.0    9.9   12.2   10.5   2.0%      2.4%     2.8%
BMRI IJ Equity     Bank Mandiri                         Financials                   Lord, Nick                 Overweight        9,800           21      664.3     798.3     923.5    12.2   13.2   11.4     2.5     2.7    2.3    10.2   10.3   11.0    9.6   2.5%      2.3%     2.6%
EXCL IJ Equity     XL Axiata                            Telecommunication Services   Killa, Navin               Overweight        4,725            4      360.3     344.3     399.3    17.5   15.2   12.6     3.2     2.5    2.2     5.0    6.3    5.6    5.1   2.3%      2.6%     3.0%
ICBP IJ Equity     Indofood CBP Sukses Makmur           Consumer Staples             Gangahar Kothiyal, Divya   Equal-Weight    12,000             3      399.8     434.2     475.5    19.5   27.3   24.9     3.9     5.3    4.7     9.5   12.1   17.0   15.2   2.1%      1.5%     1.6%
INCO IJ Equity     Vale Indonesia                       Materials                    Chong, Mean Phil           Equal-Weight      2,675            3       95.4     215.1     300.4    24.6   12.8    9.2     1.4     1.5    1.3     6.1   10.1    6.5    4.7   6.2%      1.6%     3.5%
INDF IJ Equity     Indofood Sukses Makmur               Consumer Staples             Gangahar Kothiyal, Divya   Equal-Weight      7,250            8      401.7     466.8     500.3    14.6   15.9   14.8     2.4     2.7    2.4     6.7    7.5    7.8    7.3   2.4%      2.2%     2.4%
INTP IJ Equity     Indocement Tunggal Prakarsa          Materials                    Spencer, Charles           Overweight      26,250             7    1,240.9   1,493.4   1,719.4    18.1   18.0   15.7     4.3     4.4    3.8    11.0   11.4   11.4    9.7   1.3%      2.3%     2.8%
ISAT IJ Equity     Indosat                              Telecommunication Services   Killa, Navin               Overweight        5,550            1       71.7     236.4     421.0    92.6   25.2   14.1     1.7     1.4    1.4     5.2    5.4    4.6    4.3   1.2%      0.6%     2.2%
PGAS IJ Equity     Perusahaan Gas Negara                Utilities                    Maheshwari, Mayank         Overweight        6,200           12      305.5     349.4     368.1    13.1   17.7   16.8     5.3     6.1    5.3     8.2    9.2   10.7    9.8   4.6%      3.4%     3.6%
SMGR IJ Equity     Semen Indonesia                      Materials                    Chong, Mean Phil           Overweight      18,600            12      784.3     969.6   1,049.1    20.2   19.4   17.9     5.5     5.4    4.7    12.3   13.8   13.3   12.1   2.1%      2.1%     2.6%
TLKM IJ Equity     Telekomunikasi                       Telecommunication Services   Killa, Navin               Overweight      11,300            20      705.8     806.9     890.0    13.5   14.8   13.4     2.8     3.4    3.1     4.1    4.7    5.4    5.1   4.8%      4.4%     5.2%
UNVR IJ Equity     Unilever Indonesia                   Consumer Staples             Gangahar Kothiyal, Divya   Overweight      25,900             7      652.7     732.1     813.4    31.9   35.1   31.6    36.0    39.4   35.0    25.3   22.8   25.2   22.7   2.7%      2.6%     2.8%
KLBF IJ Equity     Kalbe Farma                          Health Care                  Gangahar Kothiyal, Divya   Overweight        1,330            9       37.0      43.6      51.2    28.7   31.2   26.6     7.2     8.3    7.3    13.8   19.4   21.1   18.0   2.1%      1.9%     2.3%
BTPN IJ Equity     Bank Tabungan Pensiunan              Financials                   Lord, Nick                 Overweight        5,650            0      318.7     352.8     373.9    16.4   15.4   14.5     4.0     3.2    2.8    10.7   12.9   12.1   11.4   0.0%      1.9%     2.1%
CPIN IJ Equity     Charoen Pokphand Indonesia           Consumer Staples             Gangahar Kothiyal, Divya   Overweight        4,800            4      168.3     224.8     262.7    21.7   22.1   18.9     7.4     7.6    6.0    11.0   15.5   16.0   13.4   1.4%      1.4%     1.6%
ASRI IJ Equity     Alam Sutera Realty                   Financials                   Gardiner, Sean             Equal-Weight      1,040            7       61.8      74.6     112.1     9.7   14.6    9.7     2.5     3.7    2.8    10.9    8.1   11.7    8.1   2.6%      1.9%     2.8%
BSDE IJ Equity     Bumi Serpong Damai                   Financials                   Gardiner, Sean             Overweight        1,750            6       68.7      97.7      90.7    16.2   18.3   19.7     2.5     3.5    3.1    14.5   12.5   13.7   14.9   0.7%      1.6%     1.6%
CTRA IJ Equity     Ciputra Development                  Financials                   Gardiner, Sean             Overweight        1,340            2       30.6      48.8      72.4    26.1   28.9   19.5     2.2     3.5    3.1    15.9   16.5   16.0   11.1   1.1%      1.0%     1.5%
LPKR IJ Equity     Lippo Karawaci                       Financials                   Gardiner, Sean             Equal-Weight      1,350            9       47.2      61.5      81.7    21.2   21.9   16.5     2.2     2.6    2.3    13.8   13.1   14.5   11.4   0.8%      1.1%     1.5%
SMRA IJ Equity     Summarecon Agung                     Financials                   Gardiner, Sean             Overweight        2,625            2       88.0     103.6     137.8    21.6   26.3   19.8     3.8     4.6    3.9    12.1   13.0   14.8   11.3   1.2%      1.1%     1.5%
TBIG IJ Equity     Tower Bersama Infrastructure         Telecommunication Services   Killa, Navin               Overweight        5,550            2      141.6     227.2     283.2    31.0   23.9   20.3     6.8     5.4    4.2    18.4   25.6   16.4   13.7   0.0%      0.0%     0.0%
MSKY IJ Equity     MNC Sky Vision                       Consumer Discretionary       Killa, Navin               Overweight        2,375            2       37.1      53.7      87.5   130.4   42.0   28.0     7.6     6.9    6.0     NA    17.8   12.1    8.8   0.3%      0.8%     1.4%
TOWR IJ Equity     Sarana Menara Nusantara              Telecommunication Services   Killa, Navin               Overweight     #N/A N/A       25,000      547.2     775.0   1,012.0    66.9   37.5   24.2     6.8     6.4    5.1    11.1   15.9   13.9   11.7   0.0%      0.0%     0.0%
BEST IJ Equity     Bekasi Fajar Industrial Estate       Financials                   Gardiner, Sean             Overweight        1,010            2       59.9      90.6     121.6    11.4   11.3    8.4     3.6     3.6    2.6     NA    11.3   10.2    6.9   0.9%      0.9%     1.2%
SSIA IJ Equity     Surya Semesta Internusa              Industrials                  Gardiner, Sean             Overweight        1,510            4      150.3     162.7     192.0     7.2   10.2    8.6     3.2     3.5    2.6     6.3    4.3    6.3    5.3   0.6%      1.4%     1.5%



Malaysia
AIRA MK Equity     Air Asia                             Industrials                  Xu, Edward                 Overweight           3            7.6       0.7       0.3       0.4     4.1    8.2    7.4     1.3     1.2    1.0     9.5    5.2    7.4    6.8   0.0%      0.0%     0.0%
AXIATA MK Equity   Axiata Group Berhad                  Telecommunication Services   Chandna, Surabhi           Overweight           7           32.5       0.3       0.3       0.4    22.0   19.8   18.2     2.8     2.8    2.7     7.1    8.5    8.4    7.9   5.3%      3.8%     4.4%
DIGI Mk Equity     DiGi.com                             Telecommunication Services   Chandna, Surabhi           Underweight          5           17.6       0.2       0.2       0.2    34.1   22.3   19.4   157.4   101.0   74.8    10.9   14.3   11.9   11.2   3.5%      4.5%     5.2%
GENM MK Equity     Genting Malaysia                     Consumer Discretionary       Ling, Xin Jin              Equal-Weight         4            6.6       0.3       0.3       0.3    14.3   12.9   12.4     1.5     1.5    1.4     9.3    6.9    6.7    6.0   2.5%      2.4%     2.5%
IOI MK Equity      IOI Corporation                      Consumer Staples             Spencer, Charles           Underweight          5            6.5       0.2       0.3       0.3    18.6   19.6   17.5     2.7     2.5    2.3    12.2   14.3   13.9   12.3   2.5%      2.3%     2.7%
KLK MK Equity      Kuala Lumpur Kepong                  Consumer Staples             Spencer, Charles           Underweight         21            6.1       1.0       0.9       1.1    19.4   22.8   19.0     3.3     3.1    2.8     9.8   13.8   13.1   11.1   2.7%      2.3%     2.7%
SIME MK Equity     Sime Darby                           Industrials                  Spencer, Charles           Equal-Weight         9           22.9       0.7       0.6       0.6    14.3   17.1   15.2     2.3     2.1    1.9     8.7    9.0   10.0    9.0   3.2%      3.1%     3.4%
T MK Equity        Telekom Malaysia                     Telecommunication Services   Chandna, Surabhi           Equal-Weight         6           16.4       0.2       0.2       0.3    17.1   23.1   21.9     3.1     2.8    2.8     6.5    8.2    7.2    6.6   3.7%      3.9%     4.6%
MAXIS MK Equity    Maxis Berhad                         Telecommunication Services   Chandna, Surabhi           Equal-Weight         7           17.3       0.3       0.3       0.3    26.8   23.7   22.1     7.1     8.2    9.2    10.1   12.8   12.6   12.2   6.0%      5.9%     5.9%
PCHEM MK Equity    Petronas Chemicals Group Berhad      Materials                    Maheshwari, Mayank         Equal-Weight         6            6.7       0.5       0.5       0.4    13.4   14.4   18.4     2.3     2.2    2.1    10.3    7.1    7.5    9.1   3.7%      3.5%     2.7%
CIMB MK Equity     CIMB Group                           Financials                   Goh, Edward                Overweight           8           25.3       0.6       0.6       0.7    13.1   12.1   11.1     2.0     1.8    1.6    15.8   14.9   13.5   12.1   3.1%      3.3%     3.5%
MAY MK Equity      Maybank                              Financials                   Goh, Edward                Equal-Weight        10           35.8       0.7       0.7       0.8    12.7   13.4   12.7     1.8     1.8    1.7    11.7   12.3   12.0   10.9   5.7%      5.5%     5.8%
PBK MK Equity      Public Bank                          Financials                   Goh, Edward                Equal-Weight        16           14.4       1.1       1.2       1.3    14.8   13.9   12.2     3.2     2.9    2.5    11.3   13.3   12.7   11.2   3.1%      3.2%     3.6%
GENP MK Equity     Genting Plantations                  Consumer Staples             Spencer, Charles           Overweight           9            0.8       0.4       0.5       0.6    20.9   16.5   14.6     2.0     1.8    1.6     9.6   15.4   11.5    9.7   1.1%      2.6%     1.5%
FGV MK Equity      Felda Global Ventures Holdings Bhd   Consumer Staples             Spencer, Charles           Underweight          4            4.3       0.3       0.2       0.2    15.5   22.9   19.7     2.8     2.6    2.4     NA    13.5   12.6   10.3   1.3%      2.2%     2.5%



++ The rating for this company has been removed from consideration in this report because, under applicable law and/or Morgan Stanley policy, Morgan Stanley may be precluded from
issuing such information with respect to this company at this time. Prices as of May 3, 2013.
Source: Bloomberg, Morgan Stanley Research Estimates




                                                                                                                                                                                                                    48
                                                                                                                MORGAN            STANLEY               RESEARCH

                                                                                                                May 4, 2013                                                                                              MORGAN STANLEY RESEARCH
                                                                                                                ASEAN Equity Strategy                                                                                                                   May 3, 2013
                                                                                                                                                                                                                                               ASEAN Equity Strategy




     Valuation – Morgan Stanley Coverage Universe
                                                                                                                                           Avg Daily
                                                                                                                                  Price   Traded Vol.           MW EPS                           PE                     PB                   EV/EBITDA                   Div Yield
   Bbrg Ticker                        Name                           GICS Sector                    Analyst        MS Rating     (Local     in 6mth
                                                                                                                                  Ccy)
                                                                                                                                           USD mn       2012     2013        2014       2012    2013    2014    2012   2013    2014   2011   2012   2013   2014   2012     2013      2014


Singapore
AREIT SP Equity    Ascendas Real Estate Investment Trust      Financials                   Ng, Wilson             Equal-Weight     2.66          14.6    0.12        0.14        0.14      8.5  17.2     20.1     1.1    1.3      1.4    19.4  20.4  22.4  21.3   6.8% 5.4% 5.2%
ART SP Equity      Ascott Residence Trust                     Financials                   Ng, Wilson             Equal-Weight     1.41           1.5    0.06        0.07        0.07      9.3  19.3     19.6     0.9    1.0      1.0    14.2  17.0  17.0  16.9   6.6% 6.5% 6.4%
CCT SP Equity      CapitaCommercial Trust                     Financials                   Ng, Wilson             Equal-Weight     1.70          12.4    0.07        0.07        0.06    12.4   24.1     25.1     1.1    1.1      1.2    18.5  26.8  24.9  25.8   4.8% 4.8% 4.6%
CAPL SP Equity     CapitaLand                                 Financials                   Gardiner, Sean         Overweight       3.67          33.1    0.20        0.14        0.24    16.9   24.8     14.2     1.1    1.1      1.1     8.8  16.1  20.9  13.7   2.2% 2.4% 2.7%
CT SP Equity       CapitaMall Trust                           Financials                   Ng, Wilson             Equal-Weight     2.33          15.3    0.08        0.10        0.10    13.3   22.5     21.4     1.4    1.5      1.5    22.8  25.5  23.7  22.8   4.4% 4.4% 4.6%
CDREIT SP Equity   CDL Hospitality Trust                      Financials                   Ng, Wilson             Equal-Weight     1.99           3.4    0.11        0.12        0.12    14.9   17.2     16.7     1.2    1.2      1.2    16.2  18.2  18.5  18.0   6.0% 5.8% 6.0%
CMA SP Equity      CapitaMalls Asia                           Financials                   Gardiner, Sean         Overweight       2.06          12.0    0.14        0.06        0.08    13.8   33.6     27.0     1.2    1.2      1.2    (0.8) 13.5  35.6  24.6   1.7% 1.5% 1.7%
CIT SP Equity      City Developments                          Financials                   Gardiner, Sean         Underweight     11.38          10.7    0.52        0.69        1.12    23.4   15.5       9.6    1.7    1.4      1.3     8.4  17.9  11.8   6.6   1.6% 2.0% 2.1%
COS SP Equity      COSCO Corporation                          Industrials                  Meng, Andy             Underweight      0.87           4.6    0.05        0.03        0.04    19.6   26.0     24.2     1.5    1.4      1.4     5.7   7.3   6.5   5.7   2.6% 1.9% 2.1%
GENS SP Equity     Genting Singapore PLC                      Consumer Discretionary       Choudhary, Praveen     Underweight      1.49          36.3    0.05        0.06        0.07    28.8   23.9     20.7     1.9    2.0      1.8    11.1  10.8   9.8   8.4   0.7% 0.7% 0.7%
KEP SP Equity      Keppel Corporation                         Industrials                  Ling, Xin Jin          Overweight      10.51          38.8    1.03        0.87        0.88      8.8  12.1     12.0     2.2    2.0      1.8     9.2   9.3  10.6   9.6   4.2% 4.1% 4.3%
KPLD SP Equity     Keppel Land                                Financials                   Gardiner, Sean         Equal-Weight     4.09           9.3    0.30        0.23        0.31      7.0  17.3     13.0     1.0    1.0      0.9    10.1  23.2  20.2  13.9   3.0% 3.0% 3.0%
M1 SP Equity       M1 Limited                                 Telecommunication Services   Chandna, Surabhi       Overweight       3.30           2.5    0.16        0.18        0.19    16.7   19.2     17.6     7.1    8.2      7.5     7.9   9.1  10.6   9.9   5.4% 4.3% 4.5%
NOBL SP Equity     Noble Group                                Industrials                  Spencer, Charles       Overweight       1.13          29.4    0.08        0.13        0.17    13.6     8.7      6.6    1.4    1.2      1.1     8.9   9.7   7.5   6.1   2.6% 2.9% 3.8%
OLAM SP Equity     Olam International                         Consumer Staples             Spencer, Charles       Equal-Weight     1.66          23.3    0.11        0.12        0.14    12.1   10.6       9.1    1.4    1.2      1.1    18.6  14.3  11.2  10.1   1.5% 1.9% 3.1%
OCBC SP Equity     Oversea-Chinese Banking Corp               Financials                   Lord, Nick             Equal-Weight    10.80          27.6    1.15        0.78        0.84      8.6  14.2     13.2     1.5    1.5      1.4    14.8   9.9  15.0  14.0   3.4% 2.9% 3.3%
OUE SP Equity      Overseas Union Enterprise Limited          Consumer Discretionary       Gardiner, Sean         Overweight       3.14           3.2    0.10        0.13        0.19    26.1   23.2     16.7     0.8    0.9      0.9    18.2  18.2  19.1  15.0   2.2% 2.3% 2.6%
SCI SP Equity      SembCorp Industries                        Industrials                  Ling, Xin Jin          Equal-Weight     4.94          15.8    0.42        0.42        0.46    12.5   11.9     10.7     2.1    1.8      1.6     5.0   7.0   6.0   5.7   2.9% 3.2% 3.4%
SMM SP Equity      SembCorp Marine                            Industrials                  Ling, Xin Jin          Equal-Weight     4.26          20.4    0.26        0.29        0.34    17.8   15.1     12.6     3.9    3.2      2.8     6.7  12.0   9.7   8.1   2.8% 3.7% 4.1%
SIA SP Equity      Singapore Airlines                         Industrials                  Xu, Edward             Overweight      11.02           6.8    0.26        0.69        0.74    31.7   14.3     13.2     0.9    0.9      0.9     4.8   4.4   3.7   3.2   1.6% 2.4% 4.1%
ST SP Equity       Singapore Telecom                          Telecommunication Services   Killa, Navin           Overweight       3.81          61.1    0.23        0.22        0.24    12.6   15.9     16.0     2.0    2.3      2.4     7.2   7.8   8.9   9.0   5.0% 4.7% 4.8%
STE SP Equity      ST Engineering                             Industrials                  Ling, Xin Jin          Equal-Weight     4.40           6.0    0.18        0.20        0.21    20.4   22.3     20.6     6.2    6.7      6.3    10.7  13.3  14.1  13.2   4.4% 4.0% 4.4%
STH SP Equity      StarHub                                    Telecommunication Services   Chandna, Surabhi       Equal-Weight     4.71           6.5    0.20        0.21        0.21    18.6   22.7     22.1   14.8   17.1     16.0      8.1   9.6  11.7  11.3   5.3% 4.5% 4.6%
TGR SP Equity      Tiger Airways Holdings                     Industrials                  Xu, Edward             NAV              0.65           1.4 NA        NA          NA          NA     NA       NA     NA     NA       NA     NA      NA    NA    NA    NA    NA   NA
UOB SP Equity      United Overseas Bank                       Financials                   Lord, Nick             Equal-Weight    21.80          38.8    1.71        1.65        1.80    11.6   13.0     11.9     1.4    1.4      1.3    13.6  13.8  14.9  13.9   3.5% 2.9% 3.1%
WIL SP Equity      Wilmar International                       Consumer Staples             Spencer, Charles       Overweight       3.29          30.4    0.22        0.26        0.28    13.9   13.0     11.8     1.2    1.1      1.1    14.8  14.5  12.1  11.9   1.5% 1.7% 2.3%
DBS SP Equity      DBS Group Holdings                         Financials                   Lord, Nick             ++              17.40          48.6    1.37        1.39        1.55      9.4  11.9     10.7     1.2    1.2      1.2    13.1  13.8  14.4  13.2   3.8% 3.3% 3.8%
GGR SP Equity      Golden Agri-Resources                      Consumer Staples             Spencer, Charles       Overweight       0.53          31.4    0.04        0.05        0.05    16.2   11.3     10.6     0.8    0.6      0.6    10.6  12.7   9.9   9.2   1.8% 2.5% 2.7%
IFAR SP Equity     Indofood Agri-Resources Limited            Consumer Staples             Spencer, Charles       Overweight       1.08           2.2    0.09        0.11        0.14    14.4     9.8      7.6    1.1    0.8      0.7     6.1   8.1   6.4   5.5   0.2% 0.6% 0.8%
YZJ SP Equity      Yangzijiang Shipbuilding (Holdings) Ltd.   Industrials                  Meng, Andy             Equal-Weight     0.95          10.1    0.18        0.13        0.09      5.2    7.5    11.0     1.2    1.0      1.0     4.7   5.4   6.6   7.7   5.6% 2.7% 1.8%
HPHT SP Equity     Hutchison Port Holdings Trust              Industrials                  He, Lin                Equal-Weight     0.83          18.0    0.04        0.04        0.04    23.3   24.2     24.6     0.8    0.9      0.9    13.4  12.8  12.4  11.7   8.4% 7.2% 7.2%
BIG SP Equity      Biosensors International                   Health Care                  Li, Bin                Overweight       1.19           4.9    0.30        0.09        0.09      5.0  15.9     14.3     1.9    1.5      1.3    25.0  15.7   4.5   7.1   0.0% 0.0% 0.0%
GLP SP Equity      Global Logistic Properties                 Financials                   Gardiner, Sean         Overweight       2.80          41.1    0.09        0.07        0.08    15.2   19.9     33.9     1.1    1.3      1.3    22.7  23.0  23.5  27.0   1.8% 1.6% 1.5%
JM SP Equity       Jardine Matheson Holdings Limited          Industrials                  Ling, Xin Jin          Equal-Weight    65.20          16.7    4.93        5.56        6.06    13.4   14.3     13.2     1.3    1.3      1.2     7.5   8.6  11.2  10.5   2.2% 2.2% 2.2%
JS SP Equity       Jardine Strategic Holdings Limited         Industrials                  Ling, Xin Jin          Equal-Weight    39.51           8.8    3.16        3.49        3.77    11.9   13.8     12.7     1.0    1.0      1.0     7.4   8.6  11.1   9.6   0.6% 0.7% 0.7%
HKL SP Equity      Hongkong Land                              Financials                   Chan, Corey            Overweight       7.39          16.5    0.40        0.44        0.44    11.4   20.1     20.4     0.6    0.7      0.7    11.2  19.1  19.5  18.1   2.4% 2.3% 2.3%
FR SP Equity       First Resources                            Consumer Staples             Spencer, Charles       Overweight       1.65           3.2    0.17        0.16        0.19    10.8   10.5       9.1    2.4    1.7      1.5     7.2   8.9   7.3   6.2   1.9% 1.9% 2.2%
SPH SP Equity      Singapore Press Holdings                   Consumer Discretionary       Ling, Xin Jin          Underweight      4.42          16.1    0.22        0.22        0.21    17.5   20.4     20.8     2.9    3.2      3.2    11.2  12.8  14.3  14.6   5.9% 4.9% 4.9%




     ++ The ratings and estimates for these companies have been removed from consideration in this report because, under applicable law and/or Morgan Stanley policy, Morgan Stanley
     may be precluded from issuing such information with respect to this company at this time. Prices as of May 3, 2013. Source: Bloomberg, Morgan Stanley Research Estimates




                                                                                                                                                                                                                   49
                                                                                                               MORGAN               STANLEY               RESEARCH

                                                                                                               May 4, 2013                                                                                               MORGAN STANLEY RESEARCH
                                                                                                               ASEAN Equity Strategy                                                                                                                    May 3, 2013
                                                                                                                                                                                                                                               ASEAN Equity Strategy




Valuation – Morgan Stanley Coverage Universe
                                                                                                                                            Avg Daily
                                                                                                                                   Price   Traded Vol.            MW EPS                     PE                   PB                    EV/EBITDA                    Div Yield
   Bbrg Ticker                      Name                           GICS Sector                   Analyst            MS Rating     (Local     in 6mth
                                                                                                                                   Ccy)
                                                                                                                                            USD mn       2012      2013      2014     2012   2013   2014   2012   2013   2014   2011    2012   2013   2014   2012      2013      2014


Thailand
ADVANC TB Equity   Advanced Info Service                   Telecommunication Services   Chandna, Surabhi           Underweight       266          47.0    11.7       12.6      13.3   17.8  21.4  20.3     10.8   13.4   13.2     7.3   10.1   12.4   12.0    5.2%      4.7%     4.9%
BIGC TB Equity     Big C Supercenter                       Consumer Staples             Gangahar Kothiyal, Divya   Equal-Weight      232           5.0     7.2        8.5      10.0   28.9  27.2  23.2      5.4    5.3    4.6    10.6   15.5   15.2   13.3    1.2%      1.3%     1.5%
CPALL TB Equity    C P All                                 Consumer Staples             Gangahar Kothiyal, Divya   Overweight         42          52.3     1.2        1.5       1.8   37.5  29.4  24.8     15.5   13.4   12.1    15.2   22.7   19.3   16.3    2.0%      2.7%     3.2%
ESSO TB Equity     Esso (Thailand) Plc.                    Energy                       Maheshwari, Mayank         Underweight         9           5.0     1.1        0.8       0.5    9.1  11.7  19.4      1.3    1.1    1.1    16.7    8.4    8.7   10.6    3.3%      3.4%     2.1%
IVL TB Equity      Indorama Ventures PCL                   Materials                    Maheshwari, Mayank         Underweight        23          11.5     0.4        1.4       1.9   26.4  15.1  12.6      2.0    1.7    1.6    12.0   17.1   10.8    9.0    1.2%      2.0%     2.4%
MINT TB Equity     Minor International                     Consumer Discretionary       Gangahar Kothiyal, Divya   Equal-Weight       25           6.6     0.9        1.0       1.2   21.2  24.5  21.2      4.3    4.0    3.6    10.0   13.5   13.5   12.0    1.1%      1.4%     1.7%
PTTEP TB Equity    PTT Exploration & Production            Energy                       Maheshwari, Mayank         Equal-Weight      153          30.9    17.1       16.3      17.9    9.6   9.4   8.6      2.0    1.6    1.4     5.5    4.7    4.2    3.9    3.3%      3.4%     3.7%
PTT TB Equity      PTT Public Company                      Energy                       Maheshwari, Mayank         Overweight        326          49.9    38.1       44.8      43.1    9.3   7.3   7.6      1.6    1.3    1.2     6.1    6.2    5.8    5.8    3.8%      4.8%     4.6%
SCC TB Equity      Siam Cement                             Materials                    Maheshwari, Mayank         Underweight       478          20.3    19.7       26.7      35.7   22.4  17.9  13.4      3.7    3.6    3.1    13.7   19.5   12.5    9.5    1.6%      2.6%     3.5%
TOP TB Equity      Thai Oil Public Company                 Energy                       Maheshwari, Mayank         Underweight        64          15.7     6.0        5.9       4.7   11.2  11.2  14.0      1.6    1.4    1.4     5.6    8.3    6.7    7.2    4.0%      4.0%     3.2%
DTAC TB Equity     Total Access Comm.                      Telecommunication Services   Chandna, Surabhi           Underweight       116          17.1     4.8        4.9       5.5   18.3  24.0  21.2      6.0    7.9    7.5     6.7    8.8   10.9   10.8   22.3%      4.1%     4.2%
TRUE TB Equity     True Corporation                        Telecommunication Services   Chandna, Surabhi           Underweight         9          34.8    (0.4)      (0.5)     (0.3) NM    NM    NM         4.5   11.8   18.2     7.2   10.9   13.1   11.6    0.0%      0.0%     0.0%
PTTGC TB Equity    PTT Global Chemical PCL                 Materials                    Maheshwari, Mayank         Overweight         70          33.1     9.0        9.2       7.4    5.9   5.7   9.9      0.9    0.8    1.3     5.1    3.9    3.5    6.6    4.6%      4.8%     4.5%
KBANK TB Equity    Kasikorn Bank Public Company            Financials                   Goh, Edward                Overweight        207          36.1    14.7       17.6      21.3   13.1  12.0  10.0      2.5    2.3    2.0     7.6    9.8    9.3    7.7    1.6%      2.1%     2.4%
BBL TB Equity      Bangkok Bank Public Company Limited     Financials                   Goh, Edward                Equal-Weight      222          34.4    17.3       19.7      22.8   11.3  11.5   9.9      1.4    1.4    1.3     8.6    9.3    9.2    7.9    3.3%      3.3%     3.8%
KTB TB Equity      Krung Thai Bank Public Company          Financials                   Goh, Edward                Underweight        25          32.0     2.0        2.3       2.7    9.9  10.9   9.3      1.5    1.7    1.5     6.9    8.7    8.7    7.4    4.1%      4.0%     4.4%
SCB TB Equity      The Siam Commercial Bank Public Company Financials                   Goh, Edward                Equal-Weight      185          36.4    11.8       14.4      16.9   15.3  13.0  11.0      2.8    2.6    2.2     8.4   12.1   10.3    8.8    3.0%      3.0%     3.0%
CPF TB Equity      Charoen Pokphand Foods                  Consumer Staples             Gangahar Kothiyal, Divya   Overweight         31          30.3     0.8        2.0       2.6   13.1  15.5  12.0      2.4    2.1    1.9    13.8   25.0   13.7   11.3    3.2%      2.7%     3.5%
INTUCH TB Equity   Shin Corporation Public Company         Telecommunication Services   Chandna, Surabhi           Underweight        85          42.8     4.5        4.8       5.2   16.1  17.9  16.5      9.8   11.3   10.7    11.2   13.2   15.1   13.9    5.0%      4.8%     5.6%
IRPC TB Equity     IRPC PCL                                Energy                       Maheshwari, Mayank         Overweight          4           8.5     0.1        0.4       0.4   44.6  11.1   9.4      1.1    1.1    1.0    13.3   15.5    8.1    6.8    4.4%      4.4%     4.4%
BAY TB Equity      Bank of Ayudhya                         Financials                   Goh, Edward                Overweight         33          16.5     2.4        3.0       3.7   13.5  10.7   8.8      1.7    1.6    1.4     8.6   10.4    8.6    7.0    2.5%      3.4%     4.0%



Philippines
TEL PM Equity      PLDT                                    Telecommunication Services   Chandna, Surabhi           Overweight      3,090          11.5   179.1      200.8     229.5   14.2   15.2   13.3    4.7    7.9    7.9     7.9    7.5    8.4    7.8   7.0%       6.6%     7.5%
GLO PM Equity      Globe Telecom Inc.                      Telecommunication Services   Chandna, Surabhi           Overweight      1,550           2.8    35.2       44.2      53.8   31.0   32.3   26.6    3.2    4.4    4.6     5.5    5.7    6.5    6.2   5.4%       4.5%     4.6%




Source: Bloomberg, Morgan Stanley Research Estimates
Prices as of May 3, 2013.




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                              Coverage Universe    Investment Banking Clients (IBC)
                                             % of                   % of % of Rating
    Stock Rating Category        Count       Total     Count Total IBC Category
Overweight/Buy                    1034          36%           399          39%           39%
Equal-weight/Hold                 1250          44%           479          47%           38%
Not-Rated/Hold                     105           4%            27           3%           26%
Underweight/Sell                   473          17%           123          12%           26%
Total                            2,862                       1028
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