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Euro asia mongolia 2020
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Mongolia: 2010-2020 OutlookMongolia: 2010-2020 Outlook
Summary
� Mongolia: Massive Resources
� Mongolia 2010: Start of Multi-Year Bull Market
� Mongolia: Today and in 2020
� Growth Drivers
� Similar Growth Stories:
• Kazakhstan
• Qatar
� Conclusions2
3
Mongolia: overview
� Land Area: 1.56m sq.km(50% size of India)
� Population: 2.7m(lowest density in the world)
� Capital: Ulaanbaatar
� Religion: 95% Buddhism
� Literacy rate: 97.8%
� Language: Khalka Mongol
� Currency: Mongolian Togrog (“MNT”)
� Political System: Democracy
� GDP (2010): $6.6bn
� GDP per capita: $2,400
� GDP est 2025: $60bn
� GDP growth (2010-25): c.20% pa
� GDP per capita (2025): $20,000
Source: National Statistics Office of Mongolia
6.6 7.7 8.9 10.212.3
15.319.1
23.7
28.031.9
35.1
0
5
10
15
20
25
30
35
40
2010 2011f 2012f 2013f 2014f 2015f 2016f 2017f 2018f 2019f 2020f
GDP, US$bn (LHS)
4
Mongolia: economic growth
10 largest deposits worth US$1.3tn
Source: Temasek
GDP Growth
Source: Eurasia Capital estimates
• Fast growing economy
• Drivers of growth: investment, demand for resources and commodity prices
• Large scale production starting at Oyu Tolgoi, Tavan Tolgoi and other mines
• GDP forecast to grow 10x to $60bn by 2025
Best Performing Market
5
MSE Top-20 up 138% in 2010, best performing market globally
MNT +12.9% vs USD in 2010, second best performing currency globally
5,500
6,500
7,500
8,500
9,500
10,500
11,500
12,500
4-Ja
n18
-Jan
1-Fe
b15
-Feb
1-M
ar15
-Mar
29-M
ar12
-Apr
26-A
pr10
-May
24-M
ay7-
Jun
21-J
un5-
Jul
19-J
ul2-
Aug
16-A
ug30
-Aug
MSE Top-20 index
Source: MSE Source: Bank of Mongolia
1290
1310
1330
1350
1370
1390
1410
1430
1450
1470
1490 MNT vs USD
Mongolia - Saudi Arabia of Mining
6
‘‘Coal from Mongolia to China is happening. It is expanding,probably doubling every two years,’’ Tom Albanese, CEO,Rio Tinto
“The country is incredibly resource rich, another SaudiArabia, next to the largest population in the world,”“Mongolia could be the Saudi Arabia of Asia” Mark Faber,Emerging markets investor
“I expect frontier markets, like Mongolia, will continue tohave very compelling investment opportunities over thenext year and beyond.” Mark Mobius, Chairman,Templeton Emerging Markets
7
Mongolia in 2010 and 2020
GDP, US$bn
GDP per capita, US$
MSE Mkt Cap, US$bn
2020
6.6355x
18% per year
2,450 10,000
1 20
MNT/US$ rate 1,300ଆ900ଆ
2010
Bank Assets, US$bn 2.82.8 2525
4x
20x
9x
+30%
8
2010 2020
Copper
Iron ore
Coal
600,000 tn peryear
3.5m tn per year 12m tn per year
17m tn per year 100m tn per year
1.5m tn per year
Gold5tn per year 50tn per year
Crude Oil0.3m tn per year 4m tn per year
Source: Eurasia Capital estimates
Commodity Output
9
Growth Story I: Kazakhstan
GDP, US$bn
GDP per capita, US$
KASE MrktCap,US$bn
2007
25 1054.2x
1,250 6,750
1.2 70*
Banking assets, US$bn
Property, $/m2
370
2002
3,700
88 9797
5.5x
10x
58x
12x
* $100bn 2008
residential
retail
land
400 8,00020x
50x1,000 50,000
10
Growth Story II: Qatar
GDP, US$bn
GDP per capita, US$
Qatar SE MktCap,US$bn
2010
1011111x or
22% p.a.
15,000 82,000
4 104
Banking assets, US$bn
Population, mn 0.6
1998
1.7
1111 133133
5.5x
2.8x
27x
12x
Conclusions
Fastest growing economy in next decade (2010-2020)
11
Economy
Investments, exports, wealth creationDrivers
Mining, banking, property, consumerIndustries
All asset classes, esp. local public equitiesOpportunities
Democracy, political stability, pro-business governmentEnvironment
Right Place and Right Time to Invest!MONGOLIA
12
� Eurasia Capital is a Hong Kong-based pan-regional investment bankwith strong presence and focus in frontier markets in Eurasia
� Strong focus on Mongolia and Central Asia
� Team of 30 professionals with five offices in the region
� Pan-regional team provides full-fledged advisory and brokerage servicesto resource companies, private equity groups and hedge funds
� Advises on cross-border M&As and strategic investments in resourcessector
Eurasia Capital
13
MONGOLIAMONGOLIASuiteSuite 65,65, 66thth FloorFloorGrand Office CenterGrand Office CenterJamiyangun Street 12Jamiyangun Street 12,,11stst KhorooKhorooSukhbaatarSukhbaatar DistrictDistrictUlaanbaatarUlaanbaatarTel: +976 7013 0078Tel: +976 7013 0078Fax: +976 7013 0078Fax: +976 7013 0078
HONG KONGHONG KONG33/F One International Finance33/F One International FinanceCenter,Center,1 Harbor View Street Central,1 Harbor View Street Central,Hong KongHong KongTel:Tel: +852 2824 8716+852 2824 8716Fax:Fax: +852 2166 8999+852 2166 8999www.eurasiac.comwww.eurasiac.com
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