35th Bangkok International Motor Show 2014

The Future Growth of Stocks and Investments in Thailand

Mr. Charamporn JotikasthiraPresidentThe Stock Exchange of Thailand March 2014

2

I. SET: Overview

The Thai stock market has played a major role in facilitating investment, promoting the efficient allocation of resources, and stimulating long-term economic growth throughout the past decades.

ทีม่า: Bloomberg, The Stock Exchange of Thailand

0

300

600

900

1,200

1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Bank lending Equity Bond

Equity(Market

capitalization)USD 356 Billion

Bond Outstanding

USD 274 Billion

Bank lendingUSD 376 Billion

Outstanding value of bank lending, equity market and bond market

Billion USDGrowth

2009-2013

+56%

+101%

+61%

90% of GDP

1977

13%

87%38%

35%

27%

2013

3

Market capitalization from IPO and newly listed companies (Mil Baht)

Equity capital raising of Thai listed companies in SET(Mil Baht)

11,587 12,588 40,212

101,008

346,506

2009 2010 2011 2012 2013

28,980

80,584 85,250

257,936

165,715

2009 2010 2011 2012* 2013

Note: 2012 number includes equity capital raising of PTTEP KTB and SSI of 146,000 million baht.

SET’s market capitalization has leapt ahead with regards to IPOs and newly listed companies as well as equity capital raising.

I. SET: Overview

22 15 16

24

38

4

Number of listed companies having market capitalization >= $1 billion and daily average trading value* >= $10 million

Data are as of Dec 2013

Source : World Federation of Exchanges (WFE), Bloomberg *Average daily trading value during Jan – Dec**Large-cap listed companies mean companies having market capitalization>= $1 billion and daily average trading value >= $10 million

Average Daily Trading Value

Unit: billion USD; Data are as of Dec 2013

2219

10

7

Thailand Singapore Malaysia Indonesia

1,002 1,022

515 386

1,576

1,124

609 482

Thailand Singapore Malaysia Indonesia

72008

I. SET: Overview

SET today holds the largest numbers of listed companies with market capitalization above US$1billion, and registers the highest value traded in ASEAN.

End of 2012End of 2013

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

1/1/2005 1/1/2006 1/1/2007 1/1/2008 1/1/2009 1/1/2010 1/1/2011 1/1/2012 1/1/2013 1/1/2014

Source: The Stock Exchange of Thailand

SET index

5

Dec 2005Tsunami

Sep 2006Military Coup

Aug 2008Lehman Brothers

bankruptcy

May 2010Political unrest

Nov 2011Flood

Oct 2013-Mar 2014 Political unrest

Oct 2008Political unrest

II. SET: A Place to Invest

Long-term stock performance of SET has been remarkable amid short-term volatility.

Over the past decade, investment in Thai stocks has yielded the highest returns among financial assets, domestic and foreign.

Comparisons of returns on investment on Thai and foreign stocks(Nominal returns)

Real returns on financial assets(Nominal returns deducted by inflation)

Unit: 2004-2013 CAGR (%)

6.56.0

1.5

-1.1-2.00

0.00

2.00

4.00

6.00

8.00

10.00

Thai Stocks Gold Thai Bonds Time Deposit (1 year)

9.68.5

5.4 4.9 4.23.3

-2.00

0.00

2.00

4.00

6.00

8.00

10.00

Thailand Asia excl. Japan

USA World Japan Europe

6

Thailand World USA Europe JapanAsia excl.

JapanSource: Stock Exchange of Thailand, Ministry of Commerce, Bloomberg

II. SET: A Place to Invest

Unit: 2004-2013 CAGR (%)

Source: NESDB

The Thai economy has shown impressive resilience to shocks, and will continue to grow over the medium term.

Thailand’s GDP growth

7

4.6 5.1 5.0

2.5

-2.3

7.8

0.1

6.5

2.9 3.05.0

-4-202468

10

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014f 2015f

(%)

Dec 2005Tsunami

Sep 2006Coup

Aug 2008Lehman Brothers

bankruptcySep-Nov 2008

Political unrest andAirport closure

Apr-May 2010

Political unrest

Nov-Dec 2011Flood

Oct 2013-Mar 2014 Political unrest

III. Opportunities in the Thai Stock Market

2009 Global Financial

Crisis

In addition, earnings of Thai listed companies have grown robustly.

Earning of Thai Listed Companies, 2009 - 2013Unit: Bil Baht

6,280

7,274

8,878

10,533 11,041

240 578 629 732 782

0.00

500.00

1,000.00

1,500.00

2,000.00

2,500.00

3,000.00

3,000.00

5,000.00

7,000.00

9,000.00

11,000.00

2009 2010 2011 2012 2013

8

III. Opportunities in the Thai Stock Market

Net profitIncome

Source: SET

III. Opportunities in the Thai Stock Market

Thai listed companies have also shown significant improvement on corporate governance, marking the highest score on ASEAN corporate governance scorecard.

ACGA’s CG Watch market scores: 2007 to 2012

Source: Asian Corporate Governance Association

2007

1.Hong Kong (67)

2.Singapore (65)

3.India (56)4.Taiwan (54)

5.Japan (52)

6. Korea (49)

6. Malaysia (49)

8.Thailand (47)

9.China (45)

10.Philippines (41)

11.Indonesia (37)

2010

1.Singapore (67)

2.Hong Kong (65)

3.Japan (57)

4.Thailand (55)

4.Taiwan (55)

6.Malaysia (52)

7.India (49)

7.China (49)

9.Korea (45)

10.Indonesia (40)

11.Philippines (37)

2012

1.Singapore (69)

2.Hong Kong (66)

3.Thailand (58)

4.Japan (55)

4.Malaysia (55)

6.Taiwan (53)

7.India (51)

8.Korea (49)

9.China (45)

10.Philippines (41)

11.Indonesia (37)

ASEAN corporate governance scorecard*2012 67.7% 62.3% 56.1% 48.9% 43.4%

Thailand Malaysia Singapore Philippines IndonesiaSource: Joint Initiative of the ASEAN Capital Markets Forum and the Asian Development Bank* average total corporate governance score of the country’s 100 largest listed companies based on market capitalization

Numbers of listed companies invited toDow Jones Sustainability Index in 2013

Included in DJSI Index component

Not included in DJSI Indexcomponent

Invited list

Singapore 3 26 29Thailand 3 11 14*Malaysia - 23 23Indonesia - 16 16

Philippines - 11 11

10

IV. Global and Regional Opportunities through Thailand

Number of Thai listed companies invested abroad

47

36

1610 10

4 6 3

68

46

2519 19

11 9 7

0

10

20

30

40

50

60

70

80

2006 2012

Source : The stock exchange of Thailand

More importantly, Thai listed companies have become global and regional players.

11

IV. Global and Regional Opportunities through Thailand

Notes: * 42 listed companies revenue, ** 85 listed companies revenueSource : The stock exchange of Thailand

Foreign income of listed companies

3,401 4,027 4,8

64 5,560

6,023

9,290

11,50

4

7,474 8,3

71 9,591

8,375 10

,252 12

,701 15,13

3

02,0004,0006,0008,000

10,00012,00014,00016,000

2006 2007 2008 2009 2010 2011 2012Revenue from investment abroad* (19% CAGR)Revenue from exports** (9% CAGR)

(million USD)

Revenue of trade and investment abroad to total revenue

26 2831

34 3336

40

05

1015202530354045

2006 2007 2008 2009 2010 2011 2012

(%)

• Foreign trade and investments of Thai listed companies have generated significant portions of foreign revenues. During 2006-2013, revenue from both investment abroad and exports grew rapidly at the annual rates of 19% and 9%, respectively.

• Revenue of trade and investment abroad reached 40 percent of total revenue of listed companies in recent years.

Source: : IMF's World Economic Database, forecast as of October 2013

In particular, Thailand stands to benefit from our connectivity to high-growth CLMV.

12

2012 GDP and Expected 2015-2018 GDP growth

USD 53 billion7.0%

USD 138 billion5.5%

USD 14 billion7.5%

USD 9 billion7.6%

USD 377 billion4.7%

ChinaUSD 8,227 billion

7.0%

MalaysiaUSD 303 billion

5.2%

SET as connectivity for investing in CLMV

• Equity investment in listed companies operating in and exporting to CLMV

• Investing in holding companies operating abroad

• Infrastructure funds for infrastructure projects in CLMV

IV. Global and Regional Opportunities through Thailand