研究报告全文：6Mar2023CMBInternationalGlobalMarketsEquityResearchEconomicPerspectivesChinaPolicyPolicyremainsaccommodativewithflexibilityin2023Chinas5growthtargetfor2023releasedattheNationalPeoplesCongressBingnanYEPhDmeetingmaydisappointthemarketinneartermInvestorsthinkthetargetis85237618967conservativewiththeimplicationoflimitedpolicystimulusaheadHoweveryebingnancmbicomhkinvestorsmaygotoofarinthepessimisticdirectionasthetargetwasactuallydecidedattheCEWCinmid-DecemberChinaspolicymaybemoreflexiblethanthemarketexpectationasnewcabinetleadershavetheambitiontorestorethecountrysgrowthmomentumamiduncertaintyinglobaleconomyTheymayfacethepressuretofurthereasepolicyin2H23asthedomesticeconomicrecovery15paceslowsdownandoverseasrecessionriskincreasesWemaintainour12forecastonChinasGDPgrowthin2023at54Theproactivefiscalpolicyseemsweakerthanexpectedasbroaddeficitincludinggeneralfiscaldeficitand9localgovernmentspecialbondfinancingdroppedfrom61ofGDPin2022to659ofGDPin2023MonetarypolicyshouldremainaccommodativewitheasingcreditsupplyespeciallytomanufacturingSMEsandtechnologycompanies3PropertypolicyseemsconservativeasPremierLiKeqiangreiteratedhousingis0forlivinginnotforspeculationandwarnedtopreventpropertydevelopersfrom20072008200920102011201220132014201520162017201820192020202120222023disorderlyexpansiontocontrolfinancialsystemrisksChinawillpoolmoreChinasGDPGrowthGDPgrowthtargetresourcesintohardtechnologiesforbreakthroughsandself-relianceastheUSSourceWindCMBIGMtriestocutmoreChinesecompaniesfromglobaltechnologysupplychainsYoY1614Chinaconfirmsits5growthtargetfor2023probablydisappointingthe12marketPremierLiKeqiangconfirmedChinasGDPgrowthtargetfor2023at108around5inhisworkingreportAlowbasewith3growthlastyearand6highergrowthinmarketconsensusat5-6forthisyearmakesinvestors42believethe5growthtargetistooconservativeandimplieslimitedpolicy0stimulusaheadThereforetheChinesestockmarketmaycomeunder24pressureinnearterm620192020202120222023ButinvestorsmaygotoofarintheirpessimisticexpectationsaboutCPIPPIChinaspolicyprospectInfactthegrowthtargetfor2023wasdiscussedSourceWindCMBIGMinearlyDecemberanddecidedbythepartyleadersatthecentraleconomicworkingconferenceCEWCinmid-DecemberlastyearAtthattimethe65ChinesepolicymakerswerenotsurehowlongChinawouldtaketoreopenitseconomywhileinvestorswerestillworriedaboutaglobalrecessionin202360TheChineseseniorofficialsthoughtthe5growthtargetwasambitiousenoughtosendpro-growthsignaltolocalgovernmentsandboostmarket55confidenceHoweverChinasreopeningspeedwasmuchfasterthanexpectedThemarketexpectationsonChinaeconomyimprovedafterthe50CEWCwiththe2023growthinconsensusupfrom45-5inearlylastDecemberto5-6inthisFebruaryNowthe5growthtargetseemed45conservativeforthemarketWhyChinahasnotraiseditsgrowthtargetbased201820192020202120222023ontheeconomymarketdynamicsForonethingitisveryraretoadjustUrbansurveyedunemploymentratetheGDPgrowthtargetwhichisdecidedbythepartyleadersattheCEWCSourceWindCMBIGMThisneverhappenedinChinainthepastyearsTake2022asanexampleeconomyandfinancialmarketconditionchangedsharplyaftertheRussia-UkrainewarinFebruarybutChinamaintaineditsgrowthtargetat55attheNPCmeetingandforthewholeyeareventhegrowthwasunlikelytoachieveitstargetForanotherthingitmayreflectthetopleadersbottom-linethinkinginmakingdecisionsWebelieveChinaspolicywillbeveryflexiblethisyearPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1MOREREPORTSFROMBLOOMBERGRESPCMBRGOORhttpwwwcmbicomhk6Mar2022asthenewcabinetleadershavetheambitiontoresumeChinasgrowthwithuncertaintyindomesticeconomicrecoverypaceandoverseasrecessionriskEmploymentstabilityisimportantforconsumerconfidencerestorationChinaincreasesthetargetforurbanincrementalemploymentfrom11millionin2022to12millionin2023asthepolicymakersconsideremploymentstabilityasthekeyforconsumerconfidencerestorationChinakeepsthetargetforthesurveyedunemploymentrateat55in2023thesameasin2022Itisnotdifficultforthecabinettoachievetheemploymenttargetsin2023astherecoveryoflabor-intensiveservicebusinessesshouldhelpresumeurbanemploymentProactivefiscalpolicyisabitweakerthanexpectedasbroaddeficitratiowasslightlybelowourforecastChinasgeneralfiscaldeficitmildlyrosefrom28ofGDPin2022to3ofGDPin2023slightlybelowourforecastof31LocalgovernmentspecialbondquotamildlyrosefromRMB365trnin2022toRMB38trnin2023HoweverthepolicymakersaddedsomequotasforeligiblelocalgovernmentsunderthebalanceceilingslastyearaslocalgovernmentsnetfinancingwithspecialbondsreachedRMB404tnin2022Accordingtotheofficialbudgetgeneralfiscalrevenueisplannedtogrow67in2023afterrising06in2022thankstoeconomicrecoveryandbaseeffectGeneralfiscalexpenditureisplannedtoincrease56in202305pptlowerthanthegrowthof61in2022indicatingamoderateexpansionoffiscalexpenditureGovernmentspecialfundrevenuewithover85fromlandsalesisplannedtoslightlyrise04in2023afterdropping206in2022asthegovernmentexpectsastabilizationoflandmarketthisyearThecabinetwillmaintainsometaxcutpoliciestargetingmanufacturingSMEsindividualbusinessandafewsectorsintoughconditionbutthetotalamountoftaxcutreliefshouldbemuchlowerthanRMB42tnin2022GeneralfiscalexpenditureshouldfocusontechnologyinnovationruralrevitalizationregionalcoordinativedevelopmenteducationsocialwelfareandgreendevelopmentThecentralgovernmentwillnothandoutcashtohouseholdsastheMinistryofFinancesaidtoencourageeligiblemunicipalgovernmentstoprovidesubsidytopurchasersofgreensmarthomeapplianceconstructionmaterialsandenergysavingproductsTheMoFsaidtoacceleratethestartsofkeyprojectsinthe14th5YPlanwhilewarninglocalgovernmentstopayattentiontotheprojectreturnandtheircontingentdebtriskTheMoFindicatedtoexpandthezero-tariffproductlistforHainanfreetradezoneToboosttechnologyinnovationtheMoFwilllaunchakeyprojectcalledScientificTechInnovationfor2030andincreasesupporttokeyhardtechnologiesthisyearMonetaryshouldremainaccommodativewitheasingcreditsupplyAccordingtothedevelopmentplanfor2023thecentralbankwillmaintainreasonableampleliquidityconditiontostabilizemarketexpectationsandcontrolsystematicrisksThegrowthratesofM2andsocialfinancingbalancewillbebasicallyinlinewithnominalGDPgrowthThepolicymakersencouragebankstoexpandmedium-tolong-termloansupplytomanufacturingandincreasecreditsupporttosmallbusinessandsmallmediumspecialtechcompaniesThecabinetcallsfordeclinesofloanratesforbusinessesandconsumersThePBOCseemsmorecautiousonfurtherRRRLPRcutsinneartermduetorecentstrongnewcreditandbetter-than-expectedrecoveryinhousingsalesHoweverwedonotthinkthecentralbankwilltightencreditpolicyastheeconomyisstillintherecoveryprocessandthereflationpressureismildWecannotruleoutthepossibilityofRRRandLPRcutsin2H23asChinasrecoverypacemayslowandoverseasrecessionriskmayincreaseafterafewmonthsaheadPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE26Mar2022PropertypolicyseemsmoreconservativethanexpectedPremierLisaidtosupporthousingupgradingdemandwhilereiteratinghousingisforlivinginnotforspeculatingonThepremieralsosaidtorelievefinancialsystemriskrelatedtopropertydevelopersbystrengtheningtheirbalancesheetsandpreventingtheirdisorderlyexpansionThisexpressionshouldbenegativetothemarketastheauthorityusedsimilarwordsincrackingdowninternetplatformsandonlinetutorsin2021InadditionthepremierpledgedtoincreasethesupplyofsocialhousingincludingaffordablerentalhousingtoresolvethelivingissuefortheyouthincitiesChinawillpoolmoreresourcestohardtechnologiesforbreakthroughsandself-relianceAccordingtothecabinetreportChinawillpoolmoreresourcestohardtechnologiesforself-relianceastheUStriestocutmoreChinesecompaniesfromglobaltechnologysupplychainsTheMoFwilllaunchthesciencetechinnovationfor2030Chinawillacceleratetheconstructionofhardtechinfrastructureincludingin5GartificialintelligenceandbigdataandsupportthedevelopmentofdigitaleconomyThecountrywillalsoconsolidateitsleadingpositioninareassuchaselectricvehiclesandsolarpanelsTheChinesepolicymakerswillalsoenhancecreditandcapitalmarketfinancingsupporttoChinesetechcompaniesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE36Mar2023Figure1DailyscheduleforChinasNPCmeetingin2023DateAgendaTheGovernmentWorkReportbyLiKeqiangThedraftplanoneconomicsocialdevelopmentfor2023Thedraftplanonfiscalbudgetfor20235thMarchThedraftamendmenttotheLegislationLawDecisiononChairpersonsvice-chairpersonsandmembersofthe14thNPCConstitutionandLawCommitteeandthe14thNPCFinancialandEconomicAffairsCommittee6thMarchReviewontheGovernmentWorkReportthedraftplansondevelopmentandbudgetReviewonthedraftamendamenttotheLegislationLawTheworkreportoftheNPCStandingCommitteeNPCSC7thMarchTheworkreportoftheSupremePeoplesCourtSPCTheworkreportoftheSupremePeoplesProcuratorateSPPTheStateCouncilReorganizationPlan8thMarchReviewontheworkreportoftheNPCSCtheStateCouncilReorganizationPlanReviewontheworkreportsoftheSPCandtheSPP9thMarchProposaloncandidatesforPRCpresidentandvice-presidentchairpersonoftheCentralMilitaryCommissionCMCandchairpersonvice-chairpersonsandsecretary-generalofthe14thNPCSCDecisionontheStateCouncilReorganizationPlanDecisiononPRCpresidentandvice-presidentchairpersonoftheCentralMilitaryCommissionCMCandchairpersonvice-10thMarchchairpersonsandsecretary-generalofthe14thNPCSCProposaloncandidatesforPremieroftheStateCouncilvice-chairpersonsandmembersoftheCMCchairpersonoftheStateSupervisionCommissionSSCpresidentoftheSPCprocurator-generaloftheSPPandrank-and-filemembersofthe14thNPCSCDecisiononPremieroftheStateCouncilvice-chairpersonsandmembersoftheCMCchairpersonoftheStateSupervisionCommissionSSCpresidentoftheSPCprocurator-generaloftheSPPandrank-and-filemembersofthe14thNPCSC11thMarchProposaloncandidatesforVice-premiersstatecouncilorsdepartmentalheadssecretary-generaloftheStateCouncilandthechairpersonsvice-chairpersonsmembersofotherNPCspecialcommitteesDecisiononvice-premiersstatecouncilorsdepartmentalheadssecretary-generaloftheStateCouncilandthechairpersonsvice-12thMarchchairpersonsmembersofotherNPCspecialcommitteesDecisionontheGovernentWorkReportthedraftplansfordevelopmentandbudgettheworkreportsoftheNPCSCSPCandSPP13thMarchSpeechbyPRCPresidentSpeechbytheNPCChairmanSourceXinhuaNewsAgencyFigure2ChineseGovernmentEconomicTargets202020212022F2023FTargetActualTargetActualTargetActualTargetForecastGDPYoY-2368455305054CPIYoY3525301430203022Urbanincrementalemploymentmn90119110127110121120120Urbanunemploymentrate6052555155555555GeneralfiscalrevenueYoY53398110738066767GeneralfiscalexpenditureYoY3829180384615656GeneralfiscaldeficitRmbbn37603760357035703370337038803880GeneralfiscaldefecitasofGDP3637323128283030LocalgovtspecialbondquotaRmbbn37503750365036503650403838003800LocalgovtspecialbondquotaasofGDP3637333230332929NotablyinlinewithinlinewithinlinewithM2YoYhigherthan101norminalGDP90norminalGDP118norminalGDP110lastyeargrowthgrowthgrowthEnergyconsumptionperunitGDPYoY-185013027-012023SourceXinhuaNewsAgencyCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE46Mar2023Figure3Sectorpoliciesin2023TopicPolicyfocusAgricultureAgriculturalwaterconservancyfacilityinvestmentseedtechnologyinnovationagriculturalmachineryMiningSupplysecurityreservesystemofenergykeymineralsdomesticcapxonminingInnovationself-relianceinhardtechnologiesdigitaltransformationintraditionalindustriesSMEsintelligentizationrobotizationgreenManufacturingdevelopmentInfrastructureRapidstartsofkeyprojectsinthe14th5YPlancityrenovationprograminvestmentDigitaleconomyConstructionofinfrastructurefordigitaleconomysupporttoplatformecononydigitaltransformationoftraditionalindustriesTocontrolfossilenergyconsumptionandlowerenergyconsumptionperunitGDPby2in2023newenergysupplysystemrenewableGreendevelopmentmega-projectselectricitystoragetechpowergridupgradespollutionreductionurbanrualenvironmentalprotectioninvestmentcoalusageefficiencymetalandresourcerecyclesystemcarbonreductioninenergy-guzzlingsectorsTopreventpropertydevelopersdisorderlyexpansionandstrengthentheirbalancesheetstolowerfinanicalsystemriskstosupporthousingPropertyupgradingdemandandincreasesocialhousingsupplytosupportoldcitycommunityrenovationSOEsandPOEsSOEscompetitivenessandcorporategovernancepropertyrightprotectionforPOEsSystematicriskmanagementespeciallyinthepropertysectorlocalgovernmentcontingentdebtriskreliefwithoptimizationoftheirdebtFinancialsystemmaturityandreductionininterestburdenForeigncapitalGreatereffortstoattractforeigncapitaleasiermarketaccessandfurtheropeninginservicesectoraccesstotheCPTPPtheequalizationofbasiceducationsupporttothedevelopmentofvocationaleducationbettermedicalhealthcaresupplyinunderdevelopedPublicserviceareassupporttotheelderlycareservicedevelopmentencouragementtothefertilityMilitaryindustryMilitarytechinnovationindustryupgradingSourceXinhuaNewsAgencyCMBIGMFigure4LocalgovernmentsGDPgrowthtargetsFigure5ChinasbroaddeficitratioSourceWindCMBIGMSourceWindCMBIGMFigure6TaxlandrevenuesinChinaFigure7BroadgovernmentrevenueinChinaSourceMoFCMBIGMSourceMoFCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE56Mar2023Figure8Generalfiscalexpendituremixin2023Figure9LandrevenueinfrastructureFAISourceWindCMBIGMSourceWindCMBIGMFigure10SocialfinancingRMBloangrowthFigure11PBOCpolicyratesSourceWindCMBIGMSourceWindCMBIGMFigure12MoneymarketfundingcostFigure13GrowthofdemandindicatorsSourceWindCMBIGMSourceWindCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE66Mar2023Figure14CommoditybuildingsalesFigure15Second-homelistingpricesbycitytierSourceWindCMBIGMSourceWindCMBIGMFigure16UrbanizationpacehousingsalesFigure17PropertyinvestmentpopulationmixSourceWindCMBIGMSourceWindCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE76Mar2023Figure18OperationIncomeGrowthandMixinChinasmanufacturingYoYShareinTotalManufacturing201720182019202020212022201720182019202020212022TotalManufacturing11086371118845100010001000100010001000AgriculturalProductProcessing5738402212665615150514849Foods8373421610040222020211919LiquorBeverageRefinedTea7888502613149171716161414Tobacco146161316654091112121111Textile4002186710011363026242322TextileApparel1042341136546211917151312LeatherFursDownRelatedProductsFootware3648111458204141313111009WoodBambooRattanPalmStrawProducts2421066212501131009090908Furniture10245156013581090808070706PaperPaperProducts13785302214704141514141313RecordingMediaPrintingReproduction6552165210315080707070706CulturalEducationalSportsGoods8150204415619161414131312PetroleumOtherFuelProcessing24421140134323173395152444954ChemicalMaterialsProducts137921037311104837770677476Medicines125124744520116272626262624ChemicalFibres1491274010427853080909080909RubberPlasticProducts7536201012917302727262625Non-metallicMineralProducts94154990113819585358595956FerrousMetalSmeltingPressing220152685232298667276778673Non-ferrousMetalSmeltingPressing158877242316103535660596264MetalProducts69101491822313353737394240GeneralPurposeMachinery8478393215122454141434240SpecialPurposeMachinery101107637612818353232353232Automobile1093418346768829087877778RailwayShipAerospaceEquipment6338450611130141312121211ElectricalEquipmentMachinery121675945237207706970727687ComputersTelecomDevicesOtherElectronics13291458314755100116122128125129InstrumentsMeters10587553515942090908080808SourceWindCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE86Mar2023Figure19ExportdeliveryvaluegrowthandmixinChinasmanufacturingYoYShareinTotalExportValueExportValueasofIncome201720182019202020212022201720182019202020212022201720182019202020212022Totalmanufacturing10785130317755100010001000100010001000115133133130129128AgriculturalProductProcessing6936241003560241919171616464849454242Foods70806178145157100809080810505558535765LiquorBeverageRefinedTea29104101293489020202020102131515131314Tobacco3713030552240710000000000000040404020103Textile34332489471528252321191889110118114108106TextileApparel0409211815228373029232121205216224210206222LeatherFursRelatedProductsFootware5427172458323292525191817245260266232231235WoodBambooRattanStrawProducts183823948953070504040403606663605551Furniture802424112123144151414131310208247238226228208PaperPaperProducts3125348850302050505040405384045403746RecordingMediaPrintingReproduction626131825135040404040404637882807477CulturalEducationalSportsGoods4225358118860363029272725268276285271278266PetroleumOtherFuelProcessing602798164390246875061213080915193034242236ChemicalMaterialsProducts1411545588403214373631283337516158545763Medicines124114533666462511212111623175460597911689ChemicalFibres2058153177396234050504030404707062485161RubberPlasticProducts8766020313913323030303028122149147151148146Non-metallicMineralProducts100106308711339161514131212313733292728FerrousMetalSmeltingPressing694913228744061181714111313323125181923Non-ferrousMetalSmeltingPressing186852176499276100909081113212221182326MetalProducts95863732399603030292834311001071039510598GeneralPurposeMachinery7180085621160414244424545105137143130139143SpecialPurposeMachinery10095495821213826272831313486111117116123138Automobile158852413403300293130293442414646435769RailwayShipAerospaceEquipment2222693717286191616161616161169178169181186ElectricalEquipmentMachinery8980714421714983869296100108137164175175170161ComputersTelecomDevicesOtherElectronics14298176412718414448451476454435478515493484467432InstrumentsMeters12139132312662121010100809156158165154135138SourceWindCMBIGMPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE96Mar2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBIGMwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE10