Lian Beng Group

SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS Co. Reg No: 198700034E MICA (P) : 090/11/2009

Construction | 22 November 2011

BUY Lian Beng Group Company Update A Dragon in the bag

Analyst OOI Yi Tung [email protected] (65) 6433 5712

Price $0.335

Target $0.62

ST Index 2,697.98

Historical Chart

Performance 1m 3m 6m

Absolute (%) ‐4.1 9.7 0.4

Relative (%) ‐3.6 11.1 17.9

Stock Information

Ticker code LIBG.SI

LBG SP

Market cap (US$m) 142.2

52‐week high (S$) 0.398

52‐week low (S$) 0.275

Shares issued (m) 529.8

6m avg d.vol (S$m) 1.1

Free float (%) 74.75

Major shareholder (%) Ong Sek Chong & Sons (25.25)

Key Indicators

ROE (%) 23.1

BVPS as at Aug 2011 ($) 0.39

Interest cover (x) 54.2

Event Lian Beng’s 50:50 joint venture with Centurion Properties bought the

freehold, 68‐unit Dragon Mansion at Spottiswoode Park for $130m last week. The redevelopment can yield 118,943 sq ft of GFA, implying a sale price of $1,093 psf ppr and an estimated breakeven of $1,580 psf. As a comparison, the projects in the primary market in the area, namely, Spottiswoode 18 and Spottiswoode Residences, are selling at a median price of $2,000 psf. Maintain BUY.

Our View Dragon Mansion was first put up for sale in May this year with a reserve

price of $150‐156m but failed to attract any buyer. It returned to the market in October, gunning for $132‐142m. There were a handful of bids but Lian Beng’s offer of $130m came out tops. Two adjacent projects, Roxy Pacific’s Spottiswoode 18 and UOL’s Spottiswoode Residences, are over 90% sold at a median price of $2,000 psf. This bodes well for the redevelopment of Dragon Mansion, as competition will likely not be stiff. We have yet to factor in any earnings contribution from this project.

The sale of M‐Space, Lian Beng’s industrial project in Mandai Estate, has been very positive. We understand from the marketing agent SLP International that it is more than 90% sold at an average price of $650 psf. When completed in the middle of next year, we estimate that the project’s pre‐tax development profit of $30m will give FY May13 earnings a welcome boost.

The addition of Dragon Mansion has increased Lian Beng’s attributable unsold landbank to 84,574 sq ft. We continue to expect the group’s earnings (more than 60%) to be driven by the construction segment, backed by a strong orderbook of $761m that excludes the anticipated contracts from Mandai Estate ($66m including the building of a worker’s dormitory), Midlink Plaza ($45m) and Dragon Mansion ($42m).

Action & Recommendation We maintain our BUY recommendation on Lian Beng with a target price of $0.62, pegged at 6x FY May12F PER.

Year End May 31 2010 2011 2012F 2013F 2014F

Sales (S$ m) 345.7 507.3 522.6 535.6 587.6

Pre‐tax (S$ m) 29.0 58.3 65.4 76.5 73.3

Net profit (S$ m) 24.0 48.2 54.2 63.5 58.9

EPS (S cts) 4.5 9.1 10.2 12.0 11.1

EPS growth (%) 41.3 100.4 12.5 17.2 ‐7.3

PER (x) 7.7 3.8 3.4 2.9 3.1

EV/EBITDA (x) 3.9 2.0 0.7 0.5 0.4

Yield (%) 2.3 4.6 5.1 6.0 5.7

Lian Beng Group 22 November 2011

2

Figure 1: Primary market prices in Spottiswoode Park

Project Month Total units

Cumulative units sold

Take‐ up rate (%)

Median price

Lowest price

Highest price

Spottiswoode Residences Nov 2010 351 258 74 1,853 1,680 2,269

Spottiswoode Residences Dec 2010 351 283 81 2,051 1,833 2,248

Spottiswoode Residences Jan 2011 351 291 83 2,081 1,836 2,267

Spottiswoode Residences Feb 2011 351 298 85 2,115 2,024 2,192

Spottiswoode Residences Mar 2011 351 308 88 2,124 1,970 2,240

Spottiswoode Residences Apr 2011 351 312 89 2,155 2,114 2,187

Spottiswoode Residences May 2011 351 313 89 2,006 2,006 2,006

Spottiswoode Residences Jun 2011 351 314 89 2,232 2,232 2,232

Spottiswoode Residences Jul 2011 351 314 89 ‐ ‐ ‐

Spottiswoode Residences Aug 2011 351 316 90 2,161 2,152 2,169

Spottiswoode Residences Sep 2011 351 317 90 2,152 2,152 2,152

Spottiswoode Residences Oct 2011 351 317 90 ‐ ‐ ‐

Spottiswoode 18 Jan 2011 251 204 81 1,992 1,699 2,419

Spottiswoode 18 Feb 2011 251 227 90 2,230 1,866 2,470

Spottiswoode 18 Mar 2011 251 237 94 2,322 1,599 2,410

Spottiswoode 18 Apr 2011 251 238 95 2,300 2,300 2,300

Spottiswoode 18 May 2011 251 239 95 2,298 2,298 2,298

Spottiswoode 18 Jun 2011 251 239 95 ‐ ‐ ‐

Spottiswoode 18 Jul 2011 251 240 96 2,400 2,400 2,400

Spottiswoode 18 Aug 2011 251 240 96 ‐ ‐ ‐

Spottiswoode 18 Sep 2011 251 240 96 ‐ ‐ ‐

Spottiswoode 18 Oct 2011 251 240 96 ‐ ‐ ‐

Source: Urban Redevelopment Authority, Kim Eng

Figure 2: Location of Dragon Mansion

Source: onemap.sg


3

Figure 3: Assumptions for Lian Beng’s development projects

Stake GFA Total

cost Total

revenue Total pre‐ tax profit Take‐up rate (%) Full

(YE May) (%) (sq ft) (S$m) (S$m) (S$m) FY12F FY13F FY14F recognition

OLA Residences* 100 66,245 67.1 77.6 10.5 100 ‐ ‐ FY12

Kovan Residences 19 664,342 539.3 600.0 60.7 100 ‐ ‐ FY12

111 Emerald Hill 10 78,689 215.1 216.4 1.3 20 100 ‐ FY13

Mandai Estate 55 188,370 63.5 118.7 55.2 100 100 ‐ FY13

Lincoln Suites 25 168,000 338.0 369.6 31.6 80 100 100 FY14

*Revenue has been progressively recognised since 2009, remaining revenue is not significant. Source: Company data, Kim Eng estimates

Figure 4: Assumptions for Lian Beng’s orderbook

Contract Outstanding Recognition schedule

(YE May) size

(S$m) orderbook

(S$m) Stake (%) FY12F FY13F FY14F

Kovan Residences 201.4 0.3 100 100% 100% 100%

109A Emerald Hill 45.3 ‐ 100 100% 100% 100%

Jacking pipes for PUB 15.0 2.7 100 100% 100% 100%

111 Emerald Hill 50.4 6.7 100 100% 100% 100%

The Ritz‐Carlton Residences 99.5 ‐ 100 100% 100% 100%

Waterfront Key 101.0 30.8 100 90% 100% 100%

The Gale 112.7 54.5 100 70% 100% 100%

Waterbank 144.0 76.3 100 70% 100% 100%

Centro Residences 78.0 56.8 100 50% 90% 100%

The Laurels 95.0 75.3 100 50% 80% 100%

Spottiswoode Residences 88.3 79.5 100 20% 50% 100%

The Scala 119.5 98.1 100 50% 80% 100%

Bin Tong Park 4.9 2.1 100 100% 100% 100%

Hedges Park 150.7 149.3 100 20% 50% 100%

Waterfront Isle 128.8 128.8 100 20% 50% 100%

Outstanding orderbook 761.2

New contract in FY12 150.0 ‐ 100 0% 20% 50%

New contract in FY12 150.0 ‐ 100 0% 20% 50%

New contract in FY13 150.0 ‐ 100 ‐ 0% 20%

New contract in FY13 150.0 ‐ 100 ‐ 0% 20%

Source: Company data, Kim Eng estimates


4

Profit and loss YE May (S$m) 2010 2011 2012F 2013F 2014F

Sales 345.7 507.3 522.6 535.6 587.6 Cost of goods sold ‐300.4 ‐432.3 ‐444.2 ‐439.2 ‐493.6

Gross Profit 45.3 75.0 78.4 96.4 94.0

Operating expenses ‐19.0 ‐22.5 ‐21.7 ‐22.6 ‐23.4

Operating Profit 26.3 52.5 56.7 73.8 70.6

Net interest ‐0.7 ‐0.2 ‐0.3 ‐0.3 ‐0.3 Interest income 0.4 0.7 0.7 0.7 0.7 Interest expense ‐1.1 ‐1.0 ‐1.0 ‐1.0 ‐1.0Net investment income 3.4 6.0 9.0 3.0 3.0Net JV and associates 0.0 0.0 0.0 0.0 0.0Net exceptional items 0.0 0.0 0.0 0.0 0.0Pretax income 29.0 58.3 65.4 76.5 73.3Income taxes ‐4.8 ‐9.6 ‐10.8 ‐12.6 ‐12.1Minority interest 0.2 0.4 0.4 0.4 2.3Net profit 24.0 48.2 54.2 63.5 58.9

EBITDA 50.5 81.2 84.6 102.6 100.2EPS basic (S cts) 4.5 9.1 10.2 12.0 11.1EPS fully diluted (S cts) 4.5 9.1 10.2 12.0 11.1


Balance sheet YE May (S$m) 2010 2011 2012F 2013F 2014F

Total assets 403.6 569.3 584.4 625.3 676.2

Current assets 336.2 467.6 476.3 510.7 554.9 Cash and bank balances 70.8 149.9 203.8 238.4 273.4 Inventories 5.0 6.4 6.4 6.4 6.4 Accounts receivable 164.1 153.8 153.1 167.6 187.6 Development properties 96.4 157.6 113.0 98.2 87.5

Other assets 67.4 101.6 108.1 114.7 121.4 Property, plant & eqt 14.1 47.3 49.7 52.2 54.8 Investment properties 41.9 42.6 46.7 50.8 54.9 Others 11.4 11.7 11.7 11.7 11.7

Total liabilities 259.7 380.0 349.3 335.6 341.2

Current liabilities 198.9 270.3 267.2 273.3 297.9 Creditors & accruals 163.1 230.6 235.7 241.5 265.0 ST borrowings 28.4 27.6 20.0 20.0 20.0 Others 7.3 12.1 11.5 11.8 12.9

Long‐term liabilities 60.8 109.7 82.1 62.3 43.2 Long‐term debts 53.2 100.2 72.7 52.7 32.7 Others 7.6 9.5 9.4 9.6 10.6

Shareholder's equity 144.0 189.3 235.0 289.0 338.9

Paid‐in capital 82.3 82.3 82.3 82.3 82.3 Reserve 0.3 0.7 0.7 0.7 0.7 Accumulated profits 60.9 104.9 150.6 204.6 254.5 Minority interest 0.6 1.5 1.5 1.5 1.5


Cash flow YE May (S$m) 2010 2011 2012F 2013F 2014F

Operating cash flow 82.3 83.3 94.4 86.6 87.8 Net profit 24.0 48.2 54.2 63.5 58.9 Depreciation & amortisation 4.5 6.0 5.9 5.9 5.9 Change in working capital 51.5 31.4 40.3 17.1 23.0 Others 2.3 ‐2.3 ‐6.0 0.0 0.0

Investment cash flow ‐11.6 ‐55.2 22.5 ‐10.0 ‐10.0 Net capex ‐9.6 ‐10.3 ‐10.0 ‐10.0 ‐10.0 Change in LT investment 0.0 0.0 0.0 0.0 0.0 Change in other assets ‐2.1 ‐44.9 32.5 0.0 0.0

Cash flow after invt. 70.6 28.1 116.9 76.6 77.8

Financing cash flow ‐24.4 46.8 ‐36.0 ‐29.5 ‐31.1 Change in share capital 0.0 0.0 0.0 0.0 0.0 Net change in debt ‐20.6 46.1 ‐27.6 ‐20.0 ‐20.0 Change in other LT liab. ‐0.6 4.9 0.0 0.0 0.0 Dividends paid ‐3.2 ‐4.2 ‐8.5 ‐9.5 ‐11.1

Net cash flow 46.3 74.9 80.9 47.0 46.7

Free cash flow 72.7 73.0 84.4 76.6 77.8


Key ratios YE May 2010 2011 2012F 2013F 2014F

Growth (% YoY) Sales 12.1 46.7 3.0 2.5 9.7OP 36.5 99.8 7.9 30.3 ‐4.4EBITDA 20.5 60.7 4.2 21.3 ‐2.3NP 41.3 100.4 12.5 17.2 ‐7.3EPS 41.3 100.4 12.5 17.2 ‐7.3

Profitability (%) Operating margin 7.6 10.4 10.8 13.8 12.0EBITDA margin 14.6 16.0 16.2 19.2 17.1Net profit margin 7.0 9.5 10.4 11.9 10.0ROA 6.0 8.5 9.3 10.2 8.7ROE 16.7 25.5 23.1 22.0 17.4

Stability Gross debt/equity (%) 56.7 67.5 39.4 25.1 15.6Net debt/equity (%) 7.5 ‐11.7 ‐47.3 ‐57.4 ‐64.9Int. coverage (X) 21.6 50.7 54.2 63.5 58.9Int. & ST debt coverage (X) 0.8 1.7 2.6 3.0 2.8Cash flow int. coverage (X) 73.8 87.6 94.4 86.6 87.8Cash flow int. & ST debt (X) 2.8 2.9 4.5 4.1 4.2Current ratio (X) 1.7 1.7 1.8 1.9 1.9Quick ratio (X) 1.2 1.1 1.3 1.5 1.5Net debt (S$m) 10.9 ‐22.1 ‐111.1 ‐165.8 ‐218.6

Per share data (S cts) EPS basic 4.5 9.1 10.2 12.0 11.1CFPS 15.5 15.7 17.8 16.3 16.6BVPS 27.2 35.7 44.4 54.6 63.6SPS 65.3 95.8 98.7 101.1 110.9EBITDA/share 9.5 15.3 16.0 19.4 18.9DPS 0.8 1.6 1.8 2.1 2.0


ANALYSTS’ COVERAGE / RESEARCH OFFICES

5

SINGAPORE Stephanie WONG Head of Research Regional Head of Institutional Research +65 6432 1451 [email protected] Strategy Small & Mid Caps Gregory YAP +65 6432 1450 [email protected] Conglomerates Technology & Manufacturing Transport & Telcos Rohan SUPPIAH +65 6432 1455 [email protected] Airlines Marine & Offshore Wilson LIEW +65 6432 1454 [email protected] Hotel & Resort Property & Construction Anni KUM +65 6432 1470 [email protected] Conglomerates REITs James KOH +65 6432 1431 [email protected] Finance & Banking Logistics Resources Eric ONG +65 6432 1857 [email protected] Marine & Offshore Energy OOI Yi Tung +65 6433 5712 [email protected] Property & Construction YEAK Chee Keong, CFA +65 6433 5730 [email protected] Retail & Consumer Engineering Infrastructure

HONG KONG / CHINA Edward FUNG Head of Research +852 2268 0632 [email protected] Power Construction Ivan CHEUNG +852 2268 0634 [email protected] Property Industrial Ivan LI +852 2268 0641 [email protected] Banking & Finance Jacqueline KO +852 2268 0633 [email protected] Consumer Staples Andy POON +852 2268 0645 [email protected] Telecom & related services Samantha KWONG +852 2268 0640 [email protected] Consumer Discretionaries Alex YEUNG +852 2268 0636 [email protected] Industrial

INDIA Jigar SHAH Head of Research +91 22 6623 2601 [email protected] Oil & Gas Automobile Cement Anubhav GUPTA +91 22 6623 2605 [email protected] Metal & Mining Capital goods Property Haripreet BATRA +91226623 2606 [email protected] Software Media Ganesh RAM +91226623 2607 [email protected] Telecom Contractor

INDONESIA Katarina SETIAWAN Head of Research +6221 2557 1125 [email protected] Consumer Infra Shipping Strategy Telcos Others Ricardo SILAEN +6221 2557 1126 [email protected] Auto Energy Heavy Equipment Property Resources Rahmi MARINA +6221 2557 1128 [email protected] Banking Lucky ARIESANDI, CFA +6221 2557 1127 [email protected] Cement Construction Pharmaceutical Retail Adi N. WICAKSONO +6221 2557 1130 [email protected] Generalist Arwani PRANADJAYA +6221 2557 1129 [email protected] Technical analyst

VIETNAM Michael Kokalari, CFA Head of Research +84 838 38 66 36 x 116 [email protected] Strategy Nguyen Thi Ngan Tuyen +84 838 38 66 36 x 163 [email protected] Conglomerates Confectionary and Beverage Oil and Gas Ngo Bich Van +84 838 38 66 36 x 171 [email protected] Banking Insurance Nguyen Quang Duy +84 838 38 66 36 x 162 [email protected] Industrial Property Trinh Thi Ngoc Diep +84 422 21 22 08 x 102 [email protected] Property & Construction Power Dang Thi Kim Thoa +84 838 38 66 36 x 164 [email protected] Consumer Services Hoang Nam Phu +84 838 38 66 36 x 171 [email protected] Technology & Telecom Transport Resources Truong Quang Binh +84 838 38 66 36 x 169 [email protected] Pharmaceutical Plantation & Fishery

THAILAND Stephen LOWY Head of Research + 662 658 6300 x 4760 [email protected] Watchara SATITPORNUMNUAY + 662 658 6300 x 4770 [email protected] Retail Bank Puttikul ACKARACHALANONTH Utilities

PHILIPPINES Luz LORENZO Head of Research +63 2 849 8836 [email protected] Strategy Laura DY‐LIACCO +63 2 849 8840 [email protected] Utilities Conglomerates Telcos Lovell SARREAL +63 2 849 8841 [email protected] Consumer Media Cement Kenneth NERECINA +63 2 849 8839 [email protected] Conglomerates Property Ports/ Logistics Katherine TAN +63 2 849 8843 [email protected] Banks Construction

ECONOMICS Luz LORENZO Economist +63 2 849 8836 [email protected] Philippines Indonesia

REGIONAL ONG Seng Yeow +65 6432 1832 [email protected] Regional Products & Planning

Recommendation definitions Our recommendation is based on the following expected price performance within 12 months:

+15% and above: BUY ‐15% to +15%: HOLD ‐15% or worse: SELL


6

APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLOSURES AND

DISCLAIMERS This report, and any electronic access to it, is restricted to and intended only for clients of Kim Eng Research Pte. Ltd. ("KER") or a related entity to KER (as the case may be) who are institutional investors (for the purposes of both the Singapore Securities and Futures Act (“SFA”) and the Singapore Financial Advisers Act (“FAA”)) and who are allowed access thereto (each an "Authorised Person") and is subject to the terms and disclaimers below. IF YOU ARE NOT AN AUTHORISED PERSON OR DO NOT AGREE TO BE BOUND BY THE TERMS AND DISCLAIMERS SET OUT BELOW, YOU SHOULD DISREGARD THIS REPORT IN ITS ENTIRETY AND LET KER OR ITS RELATED ENTITY (AS RELEVANT) KNOW THAT YOU NO LONGER WISH TO RECEIVE SUCH REPORTS. This report provides information and opinions as reference resource only. This report is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. It is not to be construed as a solicitation or an offer to buy or sell any securities or related financial products. The information and commentaries are also not meant to be endorsements or offerings of any securities, options, stocks or other investment vehicles. The report has been prepared without regard to the individual financial circumstances, needs or objectives of persons who receive it. The securities discussed in this report may not be suitable for all investors. Readers should not rely on any of the information herein as authoritative or substitute for the exercise of their own skill and judgment in making any investment or other decision. Readers should independently evaluate particular investments and strategies, and are encouraged to seek the advice of a financial adviser before making any investment or entering into any transaction in relation to the securities mentioned in this report. The appropriateness of any particular investment or strategy whether opined on or referred to in this report or otherwise will depend on an investor’s individual circumstances and objectives and should be confirmed by such investor with his advisers independently before adoption or implementation (either as is or varied). You agree that any and all use of this report which you make, is solely at your own risk and without any recourse whatsoever to KER, its related and affiliate companies and/or their employees. You understand that you are using this report AT YOUR OWN RISK. This report is being disseminated to or allowed access by Authorised Persons in their respective jurisdictions by the Kim Eng affiliated entity/entities operating and carrying on business as a securities dealer or financial adviser in that jurisdiction (collectively or individually, as the context requires, "Kim Eng") which has, vis‐à‐vis a relevant Authorised Person, approved of, and is solely responsible in that jurisdiction for, the contents of this publication in that jurisdiction. Kim Eng, its related and affiliate companies and/or their employees may have investments in securities or derivatives of securities of companies mentioned in this report, and may trade them in ways different from those discussed in this report. Derivatives may be issued by Kim Eng its related companies or associated/affiliated persons. Kim Eng and its related and affiliated companies are involved in many businesses that may relate to companies mentioned in this report. These businesses include market making and specialised trading, risk arbitrage and other proprietary trading, fund management, investment services and corporate finance. Except with respect the disclosures of interest made above, this report is based on public information. Kim Eng makes reasonable effort to use reliable, comprehensive information, but we make no representation that it is accurate or complete. The reader should also note that unless otherwise stated, none of Kim Eng or any third‐party data providers make ANY warranties or representations of any kind relating to the accuracy, completeness, or timeliness of the data they provide and shall not have liability for any damages of any kind relating to such data. Proprietary Rights to Content. The reader acknowledges and agrees that this report contains information, photographs, graphics, text, images, logos, icons, typefaces, and/or other material (collectively “Content”) protected by copyrights, trademarks, or other proprietary rights, and that these rights are valid and protected in all forms, media, and technologies existing now or hereinafter developed. The Content is the property of Kim Eng or that of third party providers of content or licensors. The compilation (meaning the collection, arrangement, and assembly) of all content on this report is the exclusive property of Kim Eng and is protected by Singapore and international copyright laws. The reader may not copy, modify, remove, delete, augment, add to, publish, transmit, participate in the transfer, license or sale of, create derivative works from, or in any way exploit any of the Content, in whole or in part, except as specifically permitted herein. If no specific restrictions are stated, the reader may make one copy of select portions of the Content, provided that the copy is made only for personal, information, and non‐commercial use and that the reader does not alter or modify the Content in any way, and maintain any notices contained in the Content, such as all copyright notices, trademark legends, or other proprietary rights notices. Except as provided in the preceding sentence or as permitted by the fair dealing privilege under copyright laws, the reader may not reproduce, or distribute in any way any Content without obtaining permission of the owner of the copyright, trademark or other proprietary right. Any authorised/permitted distribution is restricted to such distribution not being in violation of the copyright of Kim Eng only and does not in any way represent an endorsement of the contents permitted or authorised to be distributed to third parties.


7

Additional information on mentioned securities is available on request. Jurisdiction Specific Additional Disclaimers: THIS RESEARCH REPORT IS STRICTLY CONFIDENTIAL TO THE RECIPIENT, MAY NOT BE DISTRIBUTED TO THE PRESS OR OTHER MEDIA, AND MAY NOT BE REPRODUCED IN ANY FORM AND MAY NOT BE TAKEN OR TRANSMITTED INTO THE REPUBLIC OF KOREA, OR PROVIDED OR TRANSMITTED TO ANY KOREAN PERSON. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF SECURITIES LAWS IN THE REPUBLIC OF KOREA. BY ACCEPTING THIS REPORT, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. THIS RESEARCH REPORT IS STRICTLY CONFIDENTIAL TO THE RECIPIENT, MAY NOT BE DISTRIBUTED TO THE PRESS OR OTHER MEDIA, AND MAY NOT BE REPRODUCED IN ANY FORM AND MAY NOT BE TAKEN OR TRANSMITTED INTO MALAYSIA OR PROVIDED OR TRANSMITTED TO ANY MALAYSIAN PERSON. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF SECURITIES LAWS IN MALAYSIA. BY ACCEPTING THIS REPORT, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply if the reader is receiving or accessing this report in or from other than Singapore. As of 22 November 2011, Kim Eng Research Pte. Ltd. and the covering analyst do not have any interest in Lian Beng Group. Analyst Certification: The views expressed in this research report accurately reflect the analyst's personal views about any and all of the subject securities or issuers; and no part of the research analyst's compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in the report. © 2011 Kim Eng Research Pte Ltd. All rights reserved. Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of Kim Eng Research Pte. Ltd. Kim Eng Research Pte. Ltd. accepts no liability whatsoever for the actions of third parties in this respect.

Singapore Equity Research Our reports are available at Bloomberg, Thomson & Reuters www.kimengresearch.com.sg

Stephanie Wong CEO, Kim Eng Research

Singapore Kim Eng Securities Pte Ltd Kim Eng Research Pte Ltd 9 Temasek Boulevard #39‐00 Suntec Tower 2 Singapore 038989 Tel: +65 6336 9090 Fax: +65 6339 6003 LAU Wai Kwok (sales) [email protected] Stephanie WONG (research) [email protected]

London Kim Eng Securities (London) Ltd 6/F, 20 St. Dunstan’s Hill London EC3R 8HY, UK Tel: +44 20 7621 9298 Dealers’ Tel: +44 20 7626 2828 Fax: +44 20 7283 6674 Giles WALSH (sales) [email protected] Geoff HO (sales) [email protected] James JOHNSTONE (sales) [email protected]

New York Kim Eng Securities USA Inc 777 Third Avenue, 21st Floor New York, NY 10017, U.S.A.

Tel: +1 212 688 8886 Fax: +1 212 688 3500

Thanh C NGUYEN (sales & trading) [email protected]

Hong Kong Kim Eng Securities (HK) Ltd Level 30, Three Pacific Place, 1 Queen’s Road East, Hong Kong Tel: +852 2268 0800 Fax: +852 2877 0104 Ray LUK (sales) [email protected] Edward FUNG (research) [email protected]

Thailand Kim Eng Securities (Thailand) Public Company Limited 999/9 The Offices at Central World, 20

th ‐ 21

st Floor,

Rama 1 Road, Pathumwan, Bangkok 10330, Thailand Tel: +66 2 658 6817 (sales) Tel: +66 2 658 6801 (research) Vikas KAWATRA (sales) [email protected]

Indonesia PT Kim Eng Securities Plaza Bapindo Citibank Tower 17

th Floor

Jl Jend. Sudirman Kav. 54‐55 Jakarta 12190, Indonesia

Tel: +62 21 2557 1188 Fax: +62 21 2557 1189 Harianto LIONG (sales) [email protected] Katarina SETIAWAN (research) [email protected]

India Kim Eng Securities India Pvt Ltd 2nd Floor, The International, Plot No.16, Maharishi Karve Road, Churchgate Station, Mumbai City ‐ 400 020, India

Tel: +91.22.6623.2600 Fax: +91.22.6623.2604

Vikas KAWATRA (sales) [email protected]

Jigar SHAH (research) [email protected]

Philippines ATR‐Kim Eng Securities Inc. 17/F, Tower One & Exchange Plaza Ayala Triangle, Ayala Avenue Makati City, Philippines 1200 Tel: +63 2 849 8888 Fax: +63 2 848 5738 Lorenzo ROXAS (sales) [email protected] Luz LORENZO (research) [email protected]

Vietnam Kim Eng Vietnam Securities Joint Stock Company 1st Floor, 255 Tran Hung Dao St. District 1 Ho Chi Minh City, Vietnam Tel : +84 838 38 66 36 Fax : +84 838 38 66 39 Vo Doan Trang (sales) [email protected] Nguyen Thi Ngan Tuyen (research) [email protected]

South Asia Sales Trading Connie TAN [email protected] Tel: +65 6333 5775 US Toll Free: +1 866 406 7447

North Asia Sales Trading Eddie LAU [email protected] Tel: +852 2268 0800 US Toll Free: +1 866 598 2267

Documents

Lian Beng Group