Forecast for the Year 2019

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2 Forecast for the Year 2019 After a lackluster year in 2018, the market is bound to come back strongly in 2019 as apprehension of political uncertainty that prevails throughout the year 2018 will no longer dent investors confidence. Historically, after held of an acceptable national election, market usually reacts very positively not only in Bangladesh but also in most of the countries in the sub-continent specially when market passes depressing time a year before. Bangladeshi stock market saw major leap after the conduction of National Election as on average 19.82% yearly return observed in the last 5 elections. Investors confidence and sentiment are expected to remain very bullish in 2019 amid some macro-economic challenges such as rising interest rate and apprehension of further depreciation of BDT against Dollar. Bangladesh Bank has planned to contain its inflation to 5.5 % and inflation in December 18 has been dropped to 5.35%. Prices of crude oil has recently fallen from $86 per bbl to $50.6 per bbl. From January- November 2018, private sector credit growth was 14.7% against 18.63% in the corresponding period of the previous year. This year appetite for taking loan would be higher compared to last year. Strong remittance, relatively higher balance of Trade compared to the first half of 2018 might ease some of the macro challenges. Moreover, we expect FDI to flow in Bangladesh in this year in bulk amount (for example, Japanese investment in Meghna Economic Zone). In addition, we expect rate of Sanchaypatra to be rationalized (reduction of Sanchaypatra by basis points). The equity market of Bangladesh is very small as its Market Cap to GDP ratio stood at only 14.60% which is even lower than that of SriLanka 17.23% the smallest market in Asia. Bangladesh equity market is attractive to the foreign investor as it has zero correlation with other stock markets that offers diversification benefits. The correlation with domestic macro factors such as money supply and private credit growth is relatively high. We believe that our market has the potential to provide structural long term growth opportunity for the potential investors. Investors should focus on companies driven by good quality management and also having high earnings growth as well as reasonable valuation. Then stock return may mimic earnings growth. Considering the macro challenges, investors sentiments, earnings growth of the listed companies and current valuation multiple of our market, we believe that DSEX will hover around 6000 point towards the end of the year implying an upside around 12.96%. According to our estimates, in bull case, base case and bear case the DSE market index might be ended up at 6300, 6100 and 5800 points. We are also optimistic about the average daily turnover of DSEX will be increased from BDT 551 cr to BDT 650 cr in Returns to be based on both earnings growth and PE expansion. We expect earnings to show double digit growth in 2019 which will be mainly led by the banking sector. 2

3 6400 Eventful 2018 in DSEX Trendline Monetary Policy Statemnet for Jan- Jun'18 (Jan 30) Begum Zia arrested (Feb 08) ADR ratio decreased (Feb 04) 5841 BB lowers CRR rate (Apr 04) % of public funds can be deposited in banks/nbfis (Mar 31) Chinese consortium signs strategic parnership deal ( May 14) 5549 Monetary Policy Statement for July -Dec'18 (Jun 28) 5405 PM attends Silver Jubilee of BSEC 5540 DSE suspends trading of KPCL (Nov 8) Jan Feb March April May June July August Sept Oct Nov Dec 3

4 Snippets from 2018 DSEX fell from 6244 points to 5385 points, a fall of 14% YoY in 2018 against rise of 24% YoY in the previous year. DSEX is now being traded at P/E, 1.79 P/NAVPS and 11.84% ROE at the end of the year Average Daily Turnover (ADTV) fell from BDT million in 2017 to BDT million in 2018 representing a fall of 37% YoY. Last 5 years average daily Turnover was 5,684 BDT million. Among the different sectors present, Engineering recorded the highest overall turnover for the year, amounting to BDT billion (17.24 % of total Turnover) followed by Textile with BDT billion ( 15.84% of total Turnover ) and Pharmaceuticals and Chemicals with BDT BDT billion ( 11.82% of total Turnover). Telecom sector suffered the most in terms of market capitalization as it decreased by 22.04% followed by Cement sector with a decrease of 18.84%. Life Insurance Sector gained the most, as market capitalization increased by 40.10% followed by Fuel and Power with 23.42%. Net Foreign sale was BDT 5.93 billion (BDT Bn purchase against sale of BDT billion). Foreign Turnover as percentage of DSE was 3.59% in 2018 against 2.64% in As on 31st December 2018, the foreign investment in the listed companies of DSE was BDT billion which is roughly 6.84% of total market capitalization. Sponsor s, Institution s and Public holdings were 55.64%, 14.62% and 18.61% respectively. Eleven new companies and one mutual funds entered the market in 2018, raising a total capital of 5,810 BDT million. First day average IPO return was 221%. Exchange rate for USD vs BDT at the end of current year was 83.9 as against 82.7 at the end of the previous year; BDT lost 1.45% value comparted to USD. Weighted Average Call Money Rate for the year ended on December, 2018 was 4.61% as compared to the previous year of 2017 December of 3.77% Average inflation rate over the twelve months was 5.55%, and on a point to point basis it was 5.35%. 4

5 Market Parameters Average Daily Turnover (mn) Market P/E Mkt Cap. to GDP (%) Shareholders % of Equity Market Cap. Equity Market Cap. (BDT bn) Sponsor 55.64% Government 4.30% Institution 14.62% Foreign 6.84% Public 18.61% Total % Free Float 40.06%

6 Sectoral Turnover & Market Capitalization Sector Mkt Cap (mn) % Bank 567, % Telecom 502, % Pharma & Chem 472, % Fuel & Power 431, % Food & Allied 274, % NBFI 186, % Engineering 176, % Textile 125, % Miscellaneous 105, % Cement 98, % Life Insurance 58, % Insurance 39, % Mutual Funds 33, % Tannery 26, % Ceramics 25, % Travel & Leisure 20, % Services 17, % Paper & Printing 17, % IT Sector 16, % Jute 4, % Total 3,202, % Travel & Leisure 2% Tannery 2% Food & Allied 4% NBFI 5% IT Sector 3% Miscellaneous 7% Life Insurance 2% Insurance 1% Telecom 2% Life Insurance 2% Ceramics 2% Textile 4% Engineering 5% NBFI 6% Food & Allied 9% InsurancePaper & Printing 1% 1% Services 1% Bank 10% 3% Miscellaneous 3% Sectoral Market Turnover Cement 2% Fuel & Power 13% Fuel & Power 11% Mutual Funds Services 1% 1% Travel & Leisure Tannery Ceramics 1% 1% 1% Cement Mutual Funds 1% Jute 1% Sectoral Market Capitalization IT Sector 1% Jute 0% Engineering 17% 2018 TURNOVER Textile 16% Pharma & Chem 12% MARKET CAPITALIZATION Paper & Printing 1% Bank 18% Pharma & Chem 15% Telecom 16% Sector Turnover (mn) % Engineering 217, % Textile 199, % Pharma & Chem 148, % Fuel & Power 138, % Bank 123, % Miscellaneous 82, % NBFI 58, % Food & Allied 52, % IT Sector 36, % Tannery 28, % Ceramics 27, % Life Insurance 27, % Telecom 23, % Travel & Leisure 20, % Cement 19, % Insurance 13, % Paper & Printing 12, % Services 10, % Mutual Funds 10, % Jute 7, % Total 1,260, % 6

7 6,900 BDT million was raised through IPO & Rights Issue Initial Public Offering in 2018 Sl. Ticker Issue Size (mn BDT) Issue Price Price at Opening Day Opening Day Return % Price at YTD Return % 1 KTL % % 2 IBP % % 3 SILVAPHL % % 4 MLDYEING % % 5 VFSTDL % % 6 SKTRIMS % % 7 INTRACO % % 8 ADVENT % % 9 QUEENSOUTH % % 10 ACFL % % 11 BPML % % Average 221% -1% Name Rights Offer Ratio Offer Price (Tk.) Rights Shar Offering in 2018 Pre Record Date Price Amount Raised in mn. (Tk.) *Adjusted for Bonus dividend Post Record Date Price Price YTD Return ALIF 1R: , % A total of 11 new companies and one mutual fund was enlisted on the DSEX in Among those, two of them were registered through book building method. Amount of capital raised through Initial public offering was 5,810 BDT million against 4,424 BDT million in In 2018,1.09 BDT billion capital was raised compared to that 12.73BDT billion in 2017 in right share offerings. IPO Issue Size 10,534 9,894 10,375 9,094 5,810 4, IPO (Fixed Price v Book Building) Fixed Price Bookbuilding Rights Share Issued in 2018 (BDT bn)

8 Close Ended funds are being trading at a discount of % to its Mkt NAV Currently there are 36 close ended mutual funds being traded on the Dhaka Stock Exchange, with 9 Asset Management Companies (AMC) managing those funds. Among the nine companies, Race manages the most number close-ended mutual funds, 10. One new closed ended funds was introduced during year, CAPMIBBLMF managed by CAPMBD. On the other hand, ICB2NDNRB managed by ICB was terminated as it completed it s tenure. AMCL No. of Close Ended Funds Market Share% Race % LRGlobal % ICB % AIMs % VIPB % VAML % AT-Cap % CAPMBD % SEML % Total % Close Ended 45% Open Ended v Close Ended Open Ended 55% IF IC 1ST M F POPU LAR 1M F F BF IF ABB1ST M F PH PM F 1 T R U ST B1M F 1J AN AT AM F EBLN R BM F EXIM 1ST M F N C C BLM F 1 SEM LLEC M F M BL1ST M F LR GLOBM F 1 VAM LBD M F 1 GR AM EEN S2 C APM BD BLM F GR EEN D ELM F PF 1ST M F VAM LR BBF EBL1ST M F R ELIAN C E1 D BH 1ST M F IC B3R D N R B IC BAM C L2N D IC BAGR AN I1 AIBL1ST IM F IC BEPM F 1S1 AT C SLGF PR IM E1IC BA IC BSON ALI1 IF ILISLM F 1 SEM LIBBLS F SEBL1ST M F N LI1ST M F C APM IBBLM F 1ST PR IM F M F M F S ( T R A D I N G A T A P R E M I U M / ( D I S C O U N T ) R E L A T I V E T O I T S M K T N A V ) 8

9 Top 20 Turnover Securities Ticker Sector Price Total Turnover (bn) % contribution to DSE turnover ADT* (mn) Return EPS (trailing) NAV per share PE (trailing) Price/NAV ROE KPCL Fuel & Power % % % UPGDCL Fuel & Power % % % BBSCABLES Engineering % % % IFADAUTOS Engineering % % % SQURPHARMA Pharma & Chem % % % BEXIMCO Miscellaneous % % % GP Telecom % % % MONNOCERA Ceramics % % % BRACBANK Bank % % % DSSL Textile % % % ACTIVEFINE Pharma & Chem % % % PTL Textile % % % AIL Engineering % % % LANKABAFIN NBFI % % % PHARMAID Pharma & Chem % % % WMSHIPYARD Engineering % % % SUMITPOWER Fuel & Power % % % NAHEEACP Engineering % % % LEGACYFOOT Tannery % % % FORTUNE Tannery % % % *ADT: Average Daily Turnover 9

10 Jan'18 Feb'18 Mar'18 Apr'18 May'18 Jun'18 Jul'18 Aug'18 Sep'18 Oct'18 Nov'18 Dec'18 YTD' Foreigners were in selling mode in the most part of 2018 Foreign Trade Buy Sell Net Investment (cr) Being positive after seven consecutive years, net foreign investment dipped to negative Tk cr. in Foreigners bought Tk cr. worth of shares against their share sales worth of Tk cr. Sharp fall in the DSEX Index, political uncertainties in election year, depreciation of the Taka against the US dollar, and irregularities in countries financial sector influenced the foreign investors to adopt a wait and see approach. In 2019, foreign investment in the country s premier bourse was positive only for three months i.e. January, March and September. Foreign Turnover as percentage of DSE was 3.59% in ,731 23,857 11,014 3, ,887 26,160 33,228 21,914 12,664 3,539 Last Five Year's Index Movement of Peers 2015 SENSEX (Bombay) Hang Seng (Hong Kong) 47,881 26,626 22,000 10,177 3, ,523 34,056 29,919 11,040 3, KSE (Karachi) 36,076 37,066 25,504 7,239 SSE Composite (Shanghai) ,494 Source: Google finance, yahoo finance Most the regional markets ended lower from where they started the year, one of the primary reasons beings the increasing tensions between China and United States with their terms of trade. DSEX (Dhaka) % % Hang Seng (Hong Kong) KSE (Karachi) % Index Return in 2018 SENSEX (Bombay) 5.93% SSE Composite (Shanghai) % SZSE Component (Shenzhen) % Source: Google finance, yahoo finance The DSEX, HANG SENG, KSE, SSE Composite, SZE Component fell by 13.93%, 14.76% 12.83%, 24.59% and 34.43% respectively in 2018; however, the SENEX gained 5.93% during the same financial period. 10

11 Regulatory Changes Small & Medium Enterprises to be listed in DSE According to the new rules, with the introduction of Small Capital Board, a company can apply for initial public offering (IPO) if it has a minimum existing paid-up capital of Tk5 crore, and intends to raise its paid-up capital by at least Tk5 crore through Qualified Investor Offer (QIO), and if after QIO its paid-up capital stands below Tk30 crore. 50pc of public funds can be deposited in pvt banks and NBFIs BB has instructed all the banks to comply with a finance ministry notification on pulling deposit from government, semi-government and autonomous entities by the private banks and non-bank financial institutions. In addition,, private banks and NBFIs would also get the same portion from annual development program fund that has been allocated to the entities from the government. DSE signs strategic partnership agreement with Chinese consortium The Dhaka Stock Exchange (DSE) agreed to sell 25% of its ordinary shares to a Chinese consortium comprised of the Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE). The consortium will hold 25% - equivalent to 450,944,125 ordinary shares - of DSE at Tk21 each in order to partner with the bourse. BB cuts banks Cash Reserve Requirement The central bank slashed the cash reserve requirement (CRR) by 1.0 percentage point to 5.50 per cent, enabling all the scheduled banks to use Tk 101 billion worth of additional fund. According to the latest decision, the existing repo interest rate of the central bank will come down to 6.00 per cent from the existing level of 6.75 per cent while the reverse repo rate will remain unchanged at 4.75 per cent Bangladesh Bank cuts loan-deposit ratio 1.5% Advance-to-deposit ratio (ADR) for conventional banks has been fixed at 83.5% instead of the existing 85%, while investment deposit ratio (IDR) for shariahcompliant Islamic banks has been set at 89% instead of the current 90%. Corporate Governance Code 2018 The Bangladesh Securities and Exchange Commission (BSEC) issued the corporate governance guideline in 2006, made it mandatory in 2013 and reissued it under the name corporate governance code on June 3,

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13 Averag Bangladesh: A Country with Enormous Growth Potential Real GDP (annual % change) GDP Growth Rate (%) vs GDP (bn) Averag Forecast GDP (current USBN$) GDP growth (annual %) Source: World Economic Outlook, October 2018, IMF Inflation ( % ) Source: Bangladesh Bank The growth story of Bangladesh has been accoladed by many investments banks, analysts, notable economists and business communities. As forecasted by IMF, we can safely say that Bangladesh will continue its momentum in GDP growth rate of above 7% at least for the next few years. Forecast Our resilient economy will be buoyed by the mega infrastructural work, remittance, export growth, demographic dividend and many more. Source: World Economic Outlook, October 2018, IMF Bangladesh GDP, local currency bn (constant price) 4,143 5,612 7,520 10,557 11,306 14,820 20,786 29,153 GDP, USD bn (constant prices) GDP, USD bn (current prices) ,054 Rank According to the CEBR Bangladesh Economy is currently the 41 st largest in the world and 2 nd among the South Asian Country. By 2033, Bangladesh economy is expected to become the 24 th largest economy in the world. Source: World Economic League Table, Centre for Economics and Business Research (CEBR) 13

14 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec Jan'18 Feb'18 Mar'18 Apr'18 May'18 jun'18 jul'18 Aug'18 Sep'18 Oct' % 18.5% 18.0% 17.7% 17.6% 16.9% 15.9% 14.9% 14.7% 14.7% Private Sector Credit Growth Private sector credit growth hit 26 months low Private Credit Growth ( Y-o-Y %) In FY Private sector credit growth is downward sloping since the beginning of the year and hit 26 months low in Sep 18, mainly due to political uncertainties in election year, liquidity crisis in the banking sector, adjustment of AD ratio and depreciation in of Taka against USD. From 18.4% in Jan 18, Private sector credit growth dropped to 14.7% on Y-o-Y basis in Oct 18 which is 2.1% lower from the BB s target of 16.8% for the first-half of the FY Crude Oil The world Bent crude oil market was unstable throughout the year. In Jan 18 Bent Crude Oil price was $67.8 per bbl. Then it went up by 37% from the lows of the start of the year in February to all the way to $86 per bbl before facing correction of 40% towards the end of December. The fall of crude oil price is positive for the economy of Bangladesh. Looking forward to 2019, USA & Russia are expected to produce more than KSA. Therefore, supply is expected to be higher than the demand which may keep the bent crude oil price lower in the coming year. Bank Borrowings The total projected budget size of is Tk 464,573 cr of which Tk 305,928 (65.85%) cr will be collected from tax revenue and Tk 33,352 (7.18%) cr will be collected from non-tax revenue whereas the rest of Tk 125,293 (26.97%) cr is projected to be the budget deficit. Of the projected budget deficit amount, Tk 54,067 (43.2%) crore will be financed from external sources while an amount of Tk 71,226 (56.8)%crore will be financed from domestic sources i.e. From domestic sources, TK 42,029 (59%) crore will be borrowed from the banking system and TK 29,197 (41%) crore from National Savings Schemes and other non-bank sources while Govt. collected Tk 46,530 (45% higher than projected amt.) cr from NSC against and borrowed Tk 5,666 (79.91% lower of projected amt.) cr from the banking channel in FY Crude Oil Price ($ per Barrel) 14

15 Dec' % 1.3% 2.0% 1.2% 5.4% 16.5% 7.4% 6.9% 6.5% 6.9% 13.1% 16.7% 71.4% 21.0% 21.5% Foreign Exchange Rate remains volatile Export by Product (Jul-Sep 2018) Import by Product (Jul-Sep 2018) RMG Jute & Jute Manufactures Fish, Shrimps and Prawns Leather and Leather Manufactures Home Textile Export from EPZ Other Source: Bangladesh Bank From July 18-Sep 18 total export was $9940 mn of which 71.5%% from RMG, 2.2% from Jute manufactures, 2.0% from Leather and Leather manufactures, 1.3% from fish, shrimp & prawns,1.2% from home textile, 16.5% from EPZ export and rest 5.4% is from other sectors. Exchange Rate Country % Bangladesh (BDT) % India (INR) % Pakistan (PKR) % Srilanka (LKR) % Local Currency Per USD Foreign Exchange Reserve (Bn $) Textiles & textile articles Machinary and Appliances Mineral products Base metals and articles of base metal Chemical products Vehicles & transport equipment. other Import from EPZ Source: Bangladesh Bank In FY , From Jul 18-Sep 18 total import was $13271 mn which consists of 21.0% of textile and textile articles, 16.7% of machinery and appliances, 13.1% of Mineral products, 7.4% of base metals,6.9% of chemical products,6.9% vehicles and transport equipment, 6.9% from EPZ and rest 21.5% is from other sectors. The foreign exchange market was volatile most part of 2018 because of the amid high import expenditure and low export earnings. As on Dec 2018, exchange rate of (BDT/USD) was Tk 83.9 per dollar which is 1.45% higher than that of the previous year. In 2019 the USD is further expected to be stronger against BDT. There was no significant change in foreign exchange reserve throughout The average Foreign Exchange reserve was 32.4 Bn USD throughout the year. Source: Bangladesh Bank 15

16 Sl. Sector Company Sl. Sector Company 1. Bank BRACBANK 2. Bank CITYBANK 3. Bank DUTCHBANGL 4. Cement CONFIDCEM 5. Engineering BBSCABLES 6. Engineering BSRMLTD 7. Engineering SINGERBD 8. Fuel & Power BARKAPOWER 9. Fuel & Power MJLBD 10. Fuel & Power SUMITPOWER 11 Miscellaneous BERGERPBL 12. Pharmaceuticals ACMELAB 13. Pharmaceuticals BXPHARMA 14. Pharmaceuticals SQURPHARMA 15. Travel & Leisure UNIQUEHRL

17 11.3% 12.2% 12.3% 12.7% 14.7% 5.3% 5.7% 8.1% 7.4% 6.6% 3.4% 3.6% 6.5% 6.0% 5.9% 1,339 2,037 2,340 4,076 5,498 5,687 6,590 7,121 8,611 9,422 7,337 8,440 9,504 11,721 13,533 Brac Bank Limited BRACBANK January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE Net Interest Income (Mn) Script BRACBANK One of the top notch governed banks in Bangladesh; Sponsored by the largest Sector BANK NGO BRAC and 40.57% foreign holding. Category A BRACKBANKs Non-Performing loan (NPL) ratio is in decreasing trend. From the year 2013 to 2017, NPL gradually decreased from 6.5% to 3.6%. Market Price 52W Range BRACKBANKs cost of fund has declined significantly from 8.10% in 2013 to 5.70% in This enables the bank to have higher net interst income. As on Dec'18 its interest rate spread is 7.2% which is also higher than any other No of Share (Mn) 1, listed banks after Dutch-Bangla bank. Though pressure from regulator to reduce interest rate spread might take a toll on net interest income of BRACKBANK. Paid Up Cap (Mn) Market Cap (Mn) Free Float (%) Sponsor (%) NAVPS 10, , % 44.30% It has manged to maintain a steady growth in Operating Profit and Net Profit After Tax (NPAT) since The 5 year CAGR of Operating Profit and NPAT of BRACBANK is 11.75% and 51.06% respectively. However as on Sep'18 the YoY growth of operating Profit and NPAT growth is -1.9% and 0.85% which is expected to bounce backin BRACBANK holds 51% equity shares of BKash Ltd. Till Sep 2018, Bkash contribution in Brac Bank s profit is 4.82%. In first 9 months,earnings of Bkash has declined by Price/Nav (Times) % on YoY basis is a major concern. However, AliPay has purchased total of 20% 1Yr ADTV (mn) 83 share of Bkash which will help Bkash to improve strategically and tecnically. BRACBANK has been suffering for its ailing subsidiary BRAC EPL Investment Ltd. It Trailing EPS Trailing PE had already taken hit in 2017 and 2018, as market turn around this would impacted positively in the bottom-line of BBL. 12M Return % NII OPERATING PROFIT (Mn) Operating Profit Net Profit After Tax (Mn) NPAT Dividend Yield 0.0% Dec Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS' Interest Income 21,734 18,310 17,700 17,254 Net Interest Margin 7.1% Loan to Dep. Ratio 83.4% Yield on Advance 11.5% CAR 12.0% Gross NPL Ratio 3.6% ROE 22.5% ROA 1.9% YoY Deposit Growth 19.5% YoY Advance Growth 15.7% Net Interest Inc. 13,533 11,721 9,504 8,440 Investment Inc. 2,915 2,558 2,496 2,486 Operating Profit 9,422 8,611 7,121 6,590 NPAT 5,498 4,076 2,340 2,037 Loans & Advance 203, , ,934 Deposit and Other Accounts 216, , , ,300 Total Asset 319, , , , ,366 Total Liabilities 292, , , ,468 EPS NIM 7.1% 7.2% 6.9% 7.1% SHAREHOLDING (%) CASA 54.7% 54.0% 58.4% 57.5% Sponsor/Director YOY loan Growth 15.7% 17.3% 20.6% 4.0% Government - Institute 8.68 YOY Deposit 19.5% 21.4% 2.2% 15.5% Foreign Growth Public 6.45 DIVIDEND HISTORY Year Cash Stock % 10.0% % 0.0% % 0.0% % 20.0% % 25.0% PRICE AND VOLUME NPL (%) NPL Cost of Fund (%) Cost of Fund CAR CAR % DIVIDEND PAYOUT Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 17

18 10.6% 14.3% 13.2% 13.2% 14.7% 4.8% 4.1% 7.0% 6.3% 5.9% 5.9% 6.0% 5.4% 8.1% 7.6% 490 1,706 3,593 3,459 4,004 3,955 4,866 6,769 6,802 7,721 4,800 5,058 5,405 6,511 7,539 City Bank Limited CITYBANK January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE Net Interest Income (Mn) Script CITYBANK IFC bought 5% stake of City Bank at a price of BDT with around BDT 131 Sector BANK cr. in Currently, their costing is around BDT considering 5% stock. Category A Being IFC in the Board, City Bank is emerging as a one of the better governed banks in the banking Sector. Market Price CITYBANK holds 23.21% share (87,510,575 share) of IDLC Finance. IDLC is 52W Range being traded at Tk and declared 30% cash dividend in The 5 year CAGR of NPAT of CITYBANK is 34.22%. However in 2018 the No of Share (Mn) Paid Up Cap (Mn) , bank s earnings have been depressed but it is expected to rebound as liquidity situation will be eased in post-election period. Market Cap (Mn) Free Float (%) Sponsor (%) NAVPS 30, % 30.29% In Q3 18 consolidated Loan portfolio grew by % from Dec 17 where as Deposit growth was 20.05% from Dec 17 in spite of prevailing liquidity crisis and intense competition of deposit collection throughout the year. Non-Performing Loan (NPL) ratio is in decreasing trend. From the year 2013 to 2017, NPL gradually decreased from 8.1% to 5.4%. We assume it will be reduced further in future. Price/Nav (Times) 1.12 CITYBANKs Cost of Fund has declined significantly from 7.0% in 2013 to 4.1% 1Yr ADTV (mn) 46 in Trailing EPS 3.11 CITYBANK has a strong capital base with a Capital Adequacy Ratio (CAR) of 14.7% against the Basel-III requirement of 10%. Trailing PE M Return % NII OPERATING PROFIT (Mn) Operating Profit Net Profit After Tax (Mn) NPAT Dividend Yield 6.0% Dec Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS' Interest Income 16,819 16,057 15,228 13,973 Net Interest Margin 4.00% Loan to Dep. Ratio 84.90% Yield on Advance 9.02% CAR 12.71% Gross NPL Ratio 5.40% ROE 13.65% ROA 1.29% YoY Deposit Growth 4.86% YoY Advance Growth 11.94% Net Interest Inc. 7,539 6,511 5,405 5,058 Investment Inc. 3,030 4,824 4,527 2,859 Operating Profit 6,802 7,721 6,769 4,866 NPAT 3,458 4,004 3,593 1,706 Loans & Advance 196, , ,015 Deposit and Other Accounts 183, , , ,490 Total Asset 275, , , , ,442 Total Liabilities 250, ,123 21,136 15,976 EPS NIM 4.0% 4.1% 4.2% 4.9% SHAREHOLDING (%) CASA 35.1% 34.0% 36.0% 31.5% Sponsor/Director 30.29% YOY loan Growth 11.9% 23.1% 22.8% 28.2% Government 0.00% Institute 21.89% YOY Deposit 4.9% 21.6% 21.1% 10.6% Foreign 12.43% Growth Public 35.39% DIVIDEND HISTORY Year Cash Stock % 20.0% % 5.0% % 0.0% % 0.0% % 5.0% DIVIDEND PAYOUT PRICE AND VOLUME NPL (%) NPL Cost of Fund (%) Cost of Fund CAR CAR % Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 18

19 13.1% 13.7% 13.8% 13.7% 14.5% 8.1% 7.3% 6.9% 9.3% 10.9% 3.9% 3.7% 4.4% 4.7% 5.2% 2,001 1,775 2,206 2,455 3,020 4,584 5,324 5,522 5,684 6,434 7,337 8,334 9,788 9,964 11,489 Dutch-Bangla Bank Limited DUTCHBANGL January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE Net Interest Income (Mn) Script DUTCHBANGL As per our analysis, CASA ratio (current deposit and savings deposit relative to Sector BANK total deposit) of DUTCHBANGL is 69.1% is one of the highest amongst the local Category A banks. Net Interest Income has grown singnificantly from 7337 mn in 2013 to 11,489 Market Price mn in As on Sep'18, YoY growth of Net Interest Income is 29.0% 52W Range Interest rate spread is 7.5% is the highest among the listed banks of capital market. No of Share (Mn) As on Sep'18 DUTCHBANGL has a Net Interest Margin is 6.7% which is also Paid Up Cap (Mn) 2, higher than any other banks after Brac bank. Market Cap (Mn) 28, Instead of liquidity crisis and intense competetion, as on Sep'18 YoY growth of operating profit and NPAT of DUTCHBANGL is 17.7% and 29% respectively. Free Float (%) 13.00% DUTCHBANGL does not have any exposure in the stock market. Therefore, Sponsor (%) 87.00% stock market volatility has no effect on their bottom line. Besides, compared to NAVPS other banks its investment income is also less volatile. Cost of Fund is in decreasing trend. From the year 2013 to 2017, Cost of Fund Price/Nav (Times) 1.48 gradually decreased from 10.9% to 6.9%. 1Yr ADTV DUTCHBANGL has a strong capital base with a Capital Adequacy Ratio (CAR) Trailing EPS of 14.5% against the Basel-III requirement of 10%. The sponsor holding of 87% is highest amongst the privately listed banks. Trailing PE M Return -5.68% NII OPERATING PROFIT (Mn) Operating Profit Net Profit After Tax (Mn) NPAT Dividend Yield 2.1% Dec Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS' Interest Income 16,529 15,365 16,028 15,207 Net Interest Margin 6.00% Loan to Dep. Ratio 88.70% Yield on Advance 8.70% CAR 14.50% Gross NPL Ratio 4.70% ROE 13.20% ROA 0.80% YoY Deposit Growth 12.80% YoY Advance Growth 19.50% SHAREHOLDING (%) CASA 69.1% 66.8% 63.2% 60.7% Sponsor/Director YOY loan Growth 19.5% 13.9% 22.4% 16.9% Government - Institute 4.55 YOY Deposit 12.8% 11.0% 12.0% 14.8% Foreign 0.13 Growth Public 8.32 DIVIDEND HISTORY Year Cash Stock % 0.0% % 0.0% % 0.0% % 0.0% % 0.0% DIVIDEND PAYOUT Net Interest Inc. 11,489 9,964 9,788 8,334 Investment Inc. 2,027 2,072 2,059 1,990 Operating Profit 5,684 5,522 6,434 5,324 NPAT 2,455 1,775 3,020 2,206 Loans & Advance 207, , ,270 Total Asset 311, , , ,994 Deposit and Other Accounts 233, , ,765 Total Liabilities 292, , , ,476 EPS NIM 6.0% 612.0% 7.6% 7.2% PRICE AND VOLUME 124, ,762 NPL (%) NPL Cost of Fund (%) Cost of Fund CAR CAR % Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 19

20 Baraka Power Limited BARKAPOWER January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script BARKAPOWER Apart from its two ongoing power plants (Baraka Power Ltd and Baraka Patenga Power Ltd) Sector Fuel & Power Baraka Power Limited aggregately holds 46.01% of Baraka Shaikalbaha Power Limited, (a 105 MW powerplant with proportionate ownership of MW) and 51.01% of Karnaphuli Category A Power Limited (a 110 MW powerplant with proportionate ownership of MW) and the prospective date of operation of these power plants are within the year Both of the Market Price plants are HFO (Heavy Furnace Oil) based IPP power plants and have been granted contract 52W Range tenure for 15 years from the commercial operation date (COD). The status of the existing power plants is as follows: No of Share (Mn) Paid Up Cap (Mn) 2, Market Cap (Mn) 6,844 Free Float (%) Sponsor (%) NAVPS *As per DSE News, the expected date of commercial operation of Baraka Shikalbaha Power Price/Nav (Times) 1.49 and Karnaphuli Power were Nov 18 and May 19. We expect that the power plants will be under commercial operation within September, Yr ADTV 632,653 Trailing EPS Trailing PE 12M Return % Therefore, Baraka Power Limited's total power generation capacity would stand at 180 MW. This would represent an increase of 137% from their existing capacity. Assuming usual delay in commercial date of operation, we can safely expect that this power generation would increase the profitability of Baraka Power from the period of Q1, Dividend Yield 3.2% Financial Snapshoots at a Glance [Amount in BDT. Mn] 5Y Revenue CAGR 23% June KEY FINANCIAL RATIOS Revenue 3, , , , Y Op. Profit CAGR 20% 5Y NPAT CAGR 6% Gross Margin 31% Operating Margin 24% Net Profit Margin 10% ROE 8% Plant Name Ownership Capacity (MW) Entitle to Fuel Type Baraka Power (MW) Baraka Power Limited % Gas Baraka Patenga Power Limited 50.00% HFO Baraka Shikalbaha Power Limited 46.01% HFO Karnaphuli Power Limited 51.01% HFO Gross Profit 1, , , ,042.1 Op. Profit Net Profit Total Asset 10, , , ,341.6 Total Debt 4, , , , Debt/Equity 97.4% 91.3% 100.6% 127.3% ROE 7.5% 14.2% 14.4% 15.8% 3,844 3,485 3,580 2,960 1,573 OPERATING PROFIT (Mn) GROSS PROFIT (Mn) 1,122 1,115 1,100 1, NET PROFIT (Mn) ROA 3% Debt to Equity Ratio 97% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign - Public DIVIDEND HISTORY Year Cash Stock % 17.0% % 8.0% % 5.0% % 15.0% % 0.0% DIVIDEND PAYOUT Year EPS PAYOUT Gross Margin 30.7% 32.0% 37.9% 27.1% Operating Margin 23.9% 28.4% 32.7% 22.6% PAT Margin 9.8% 17.5% 19.6% 14.8% ROE YoY Revenue Gr. 2.7% 17.7% -23.0% 144.3% 16% 14% 14% YoY PAT Gr % 5.4% 2.0% 103.2% 9% 8% PRICE AND VOLUME DEBT/EQUITY 147% 127% 101% 91% 97% % % % % % Source: PBIL and PBSL Research 20

21 Unique Hotel & Resorts Limited UNIQUEHRL January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category UNIQUEHRL Travel & Leisure A Unique Hotel & Resorts owns The Westin Dhaka -the pioneer of Five Star hotel in the private sector of Bangladesh. Its hotel business is carried out through a Management Contract between Unique Hotel & Resorts Ltd (the Owner) and J.W. Marriott International (the operator). HANSA (a premium star premium hotel) at Uttara which was inaugurated on March 12, This new addition of hotel hospitality and higher hotel occupency rate thanks to political calmness in 2019 will be expected to Market Price drive the bottomline of the company. 1,924 2,123 1,942 1,677 2,036 52W Range No of Share (Mn) Paid Up Cap (Mn) Free Float (%) 2, Market Cap (Mn) ,926 Trailing PE M Return -3.72% Dividend Yield 3.7% Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV Trailing EPS Y Revenue CAGR 1% June The soft opening of the Sheraton Dhaka Banani Hotel is expected at the end of The operator of this hotel will be Marriott International and the interior design has been developed as per the guideline & compliance of J.W. Marriott International. This hotel is being built with the proceeds of its IPO fund collected in The other ongoing projects of the Company are Hyatt Centric Dhaka Hotel at Gulshan, St. Regis Hotel & Serviced Apartment (7 Star Hotel) (First in Bangladesh) at South Park which is adjacent to the Westin Dhaka. The implementation of this project may act as the key driver for generating revenue for the company in coming year. In order to diversify its business, the company has entered into power generation business. A consortium involving Unique Hotel was granted the permission to build a 600 MW power plant of Gas or Re-gasified Liquified Natural Gas at Meghnaghat of Narayanganj. The company owns 65.01% shareholding in the power plant along with Guayama PR Holding (30%) and Startegic Finance Ltd (4.99%) and thus 390 MW of power will be added to Unique Hotel. The consortium will sale electricity at /unit (if run by gas) or at /unit (if run by LNG). The company will set up necessary transmission lines and sub-stations at its own cost. After successful completion of the first phase 600 MW project, the consortium will go for the second phase 600 MW capacity power project. Other proposed important project is Sonargaon Economic Zone Limited (SEZL) at Meghnaghat, Sonargaon, Narayangong, World Trade Center Dhaka and Sonargaon Economic Zone Ltd. (SEZL). Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 2, , , , Y Op. Profit CAGR 0% 5Y NPAT CAGR -13% Gross Margin 76% Operating Margin 50% Net Profit Margin 29% ROE 2% Gross Profit 1, , , ,691.9 Op. Profit 1, ,160.6 Net Profit Total Asset 32, , , ,137.2 Total Debt 3, , , Debt/Equity 14.6% 12.9% 5.9% 2.3% ROE 2.3% 2.0% 2.4% 3.7% OPERATING PROFIT (Mn) 1,161 1, , GROSS PROFIT (Mn) 1,692 1,521 1,496 1,545 1,270 NET PROFIT (Mn) 1, ROA 2% Debt to Equity Ratio 15% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign 1.37 Public DIVIDEND HISTORY Year Cash Stock % 0.0% % 0.0% % 0.0% % 0.0% % 0.0% DIVIDEND PAYOUT Gross Margin 75.9% 75.7% 77.1% 79.7% Operating Margin 49.6% 49.0% 51.4% 54.7% PAT Margin 29.1% 31.6% 32.5% 45.4% ROE 4% YoY Revenue Gr. 21.4% -13.6% -8.5% 10.3% 4% YoY PAT Gr. 11.7% -15.8% -34.5% -5.1% 2% 2% 2% PRICE AND VOLUME DEBT/EQUITY 13% 15% Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 6% 2% 2% 21

22 Beximco Pharmaceuticals Ltd. BXPHARMA January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category No of Share (Mn) Paid Up Cap (Mn) 4, Market Cap (Mn) 34, Free Float (%) Sponsor (%) NAVPS Price/Nav (Times) BXPHARMA Pharmaceuticals Market Price W Range Yr ADTV 353,935 Trailing EPS 5.76 Trailing PE M Return % Dividend Yield 1.4% 5Y Revenue CAGR 12% A June The Company has already invested around USD 128 million to expand its production capacity and upgrade its existing production facilities. The projects include Unit III Oral Solids, Semi Solids and Liquid facilities at Tongi site. Once operational the Unit III facility will have an annual capacity of about 5 billion solid-dose tablets, capsules and sachets; 70 million semi-solid units, including creams, ointments, liquid sachets and lotions; and 130 million large- and small-volume bottles of liquid formulations. human insulin facility is now ready and commercial launch is expected by Q1 of New API Unit II - manifacturing facility of API, will also be expected to be completed soon to sourcing partial requirement of raw materials. Beximco Pharma acquired 85.22% stake in Nuvista Pharmaceutical in which is a good strategic fit for the the acquirer as the later has strong position in hormones and steroid drugs. Beximco Pharma is expected to capitalize the synergy dervied from the acquisition in coming years. The Company hasa growing and visible presence in US drug markets with six products approved by the USFDA and 4 of them being exported. Exports now make 8.5% of overall sales which registered 37% YoY growth in 22 countries including USA and Canada in Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 17, , , , Y Op. Profit CAGR 14% 5Y NPAT CAGR 13% Gross Margin 47% Operating Margin 23% Net Profit Margin 14% ROE 9% Gross Profit 8, , , ,000.3 Op. Profit 4, , , ,851.3 Net Profit 2, , , ,954.3 Total Asset 43, , , ,835.6 Total Debt 11, , , , Debt/Equity 40.9% 18.3% 19.1% 21.4% ROE 9.3% 8.9% 8.5% 8.7% 17,717 15,509 12,966 13,356 11,207 OPERATING PROFIT (Mn) 4,026 3,448 2,851 2,972 2,418 GROSS PROFIT (Mn) 8,286 7,185 6,000 6,156 5,104 NET PROFIT (Mn) 2,533 2,227 1,954 1,965 1,528 ROA 6% Debt to Equity Ratio 41% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign Public DIVIDEND HISTORY Year Cash Stock % 5.0% % 0.0% % 5.0% % 0.0% % 0.0% Gross Margin 46.8% 46.3% 46.1% 46.3% Operating Margin 22.7% 22.2% 22.3% 22.0% PAT Margin 14.3% 14.4% 14.7% 15.1% ROE YoY Revenue Gr. 14.2% 16.1% 3.0% 15.7% 9% 9% 9% 9% 7% YoY PAT Gr. 13.7% 13.3% 0.6% 27.9% PRICE AND VOLUME DEBT/EQUITY 41% DIVIDEND PAYOUT Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 23% 21% 19% 18% 22

23 Square Pharmaceuticals Ltd. SQURPHARMA January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category Free Float (%) SQURPHARMA Pharmaceutical Market Price W Range No of Share (Mn) Paid Up Cap (Mn) 7, Market Cap (Mn) Mn Trailing EPS Trailing PE M Return % A Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 360, Dividend Yield 1.4% 5Y Revenue CAGR 14% June Significant market size and growth rate provides Square Pharma to grab a huge portion of pharma market in Kenya. The subsidiary in Kenya provides Square Pharma the opportunity to serve in 16 countries of Eastern and Southern Africa. Kenya supplies about 50% of total pharmaceuticals products in this region. Square Pharmaceuticals EPZ Kenya has started to build a plant in Nairobi with an initial investment of USD 25 million. The yearly capacity of plant is 2,000 million tablets and capsules and 60 million bottles of liquid formulations. According to the company, the expected capacity utilization in the first year of the plant is 25%. Commercial operation of the plant will generate BDT 1,030 million in the first year of operation. The commercial operation of the company is expected to begin in July The subsidiary in Kenya provides Square Pharma the opportunity to serve in 16 countries of Eastern and Southern Africa. Kenya supplies about 50% of total pharmaceuticals products in this region. The government of Kenya imposes 0% VAT rate on the revenue of pharmaceuticals products in Kenya. Square Pharma gets the opportunity to retain larger portion of their revenue due to this policy. Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 39, , , , Y Op. Profit CAGR 20% 5Y NPAT CAGR 25% Gross Margin 49% Operating Margin 31% Net Profit Margin 26% ROE 18% Gross Profit 19, , , ,741.7 Op. Profit 12, , , ,049.6 Net Profit 10, , , ,186.4 Total Asset 61, , , ,191.2 Total Debt Debt/Equity 0.0% 0.0% 0.0% 2.9% ROE 18.1% 19.8% 20.4% 16.7% 39,654 36,543 33,074 26,685 23,268 OPERATING PROFIT (Mn) 12,296 12,481 10,791 7,050 5,968 GROSS PROFIT (Mn) 19,564 18,268 15,991 11,742 10,308 NET PROFIT (Mn) 10,491 9,719 8,287 5,186 4,251 ROA 17% Debt to Equity Ratio 0% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign Public DIVIDEND HISTORY Year Cash Stock % 15.0% % 12.5% % 10.0% % 7.5% % 7.0% Gross Margin 49.3% 50.0% 48.4% 44.0% Operating Margin 31.5% 33.6% 32.6% 26.4% PAT Margin 26.5% 26.6% 25.1% 19.4% ROE YoY Revenue Gr. 8.5% 10.5% 23.9% 14.7% 20% 20% 18% YoY PAT Gr. 16% 17% 7.9% 17.3% 59.8% 22.0% PRICE AND VOLUME DEBT/EQUITY 7% DIVIDEND PAYOUT Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 3% 0% 0% 0% 23

24 BBS Cables Limited BBSCABLES January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category Paid Up Cap (Mn) 1, Market Cap (Mn) 14, Free Float (%) Dividend Yield 0.9% BBSCABLES ROA 17% Debt to Equity Ratio 72% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign 1.02 Public DIVIDEND HISTORY Engineering Market Price W Range No of Share (Mn) Y Revenue CAGR 37% 5Y Op. Profit CAGR 44% 5Y NPAT CAGR 74% Gross Margin 34% Operating Margin 29% Net Profit Margin 17% ROE 33% Year Cash Stock Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 1,197,696 Trailing EPS 9.77 Trailing PE M Return 17.36% A June Being the second largest electrical wires and cable manufacturer of Bangladesh, BBS Cables has shown double-digit bottom-line growth in the last five years. Thanks to growing demand in power and digitalization of the country, the company should enjoy sustainable demand growth in years to come. REB, PDB, DESCO and DESA are some of the key customers of the company. The company has planned to setting up its Factory Unit 2 using stateof-the-art technology for producing up to 220 (245) kv Voltage Grade HV/EHV Power Cables. Utilizing IPO proceeds and the Company is planning to start the commercial production from the new machineries with effect by the beginning of year The current installed annual production capacity of the Company is 16,600 MT as on as a result of installing the new machineries, the annual production will increase by 37% (6,100 MT) that will stand up to 22,700 MT (approx.) annually, the value of which is about Tk. 1,200 crore approx. The company has received Notification of Award (NOA) from a power distribution company and a government owned electricity generation company amounting BDT cr in It is expected that the company's topline will be stimulated by the growing demand in electric wire in foreseeable future. Financial Snapshoots at a Glance Op. Profit 1, Net Profit 1, Total Asset 6, , ,481.0 Total Debt 2, , , , Debt/Equity 71.6% 100.4% 126.5% 384.5% ROE 33.2% 18.0% 14.6% 37.1% Gross Margin 33.8% 34.0% 34.4% PAT Margin 16.9% 11.8% YoY Revenue Gr. 87.3% 35.9% YoY PAT Gr % 68.0% 22.5% PRICE AND VOLUME [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 6, , , ,268.7 Gross Profit 2, , % 8.9% ROE 14.0% 3, % Operating Margin 28.6% 26.9% 26.3% 26.5% 21.3% 65.2% 1,871 2,269 2,587 3,517 OPERATING PROFIT (Mn) GROSS PROFIT (Mn) NET PROFIT (Mn) 6, , , ,225 1,115 32% 37% 15% 18% 33% % 0.0% % 0.0% % 0.0% % 15.0% % 15.0% DIVIDEND PAYOUT DEBT/EQUITY 459% 385% Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 126% 100% 72% 24

25 Confidence Cement Ltd. CONFIDCEM January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category CONFIDCEM Cement Market Price W Range No of Share (Mn) Paid Up Cap (Mn) Market Cap (Mn) 10, Free Float (%) Sponsor (%) A NAVPS Confidence Cement Limited (CCL) produces two types of cement products namely Portland Cement and Portland Composite Cement. Confidence Cement Limited has holdings in its two aassociates; 25% ownership in Confidence Power Limited and 49% ownership in Confidence Electric Limited. Other investment has been made to secure 49% holding in Confidence Batteries Limited and 51% holding in Joint Venture between Confidence Cement Limited and Confidence Steel Limited. Investment in new joint venture between Confidence Cement and Confidence Steel (consisting of aggregated 226 MW Power Plants) will give a huge boost to its top line and bottom line on a consolidated basis after the commencement of commercial production which is set to happen in the year of FY Confidence Cement Limited will be holding ownership of 51% in the new joint venture. 3,626 3,637 3,614 3,629 3,917 OPERATING PROFIT (Mn) Price/Nav (Times) Yr ADTV 238,325 Trailing EPS 7.50 Trailing PE M Return 38.36% Dividend Yield 0.8% 5Y Revenue CAGR 2% June Confidence Cement Limited is expected to invest in the new Power Plant Projects located at Bogra, Rangpur and Chittagong. The power plants, under Confidence Power Holdings Limited, will produce be MW electricity. The Bogra power plants will be 226 MW, Rangpur 113 MW and Chittagong MW. Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 3, , , , Y Op. Profit CAGR -46% 5Y NPAT CAGR 14% Gross Margin 8% Operating Margin 1% Net Profit Margin 10% ROE 9% Gross Profit Op. Profit Net Profit Total Asset 8, ,724.1 Total Debt 3, , , , , , Debt/Equity 78.5% 84.3% 59.8% 54.9% ROE 9.1% 13.2% 13.9% 10.5% 37 GROSS PROFIT (Mn) NET PROFIT (Mn) ROA 5% Debt to Equity Ratio 78% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign - Public DIVIDEND HISTORY Year Cash Stock % 0.0% % 0.0% % 0.0% % 20.0% % 20.0% Gross Margin 8.4% 17.5% 21.9% 15.7% Operating Margin 0.9% 4.6% 12.7% 11.3% PAT Margin 9.6% 13.7% 12.7% 9.0% ROE YoY Revenue Gr. 7.9% 0.4% -0.6% 0.3% 14% 13% YoY PAT Gr % 8.3% 41.0% 49.6% 11% 9% 8% PRICE AND VOLUME DEBT/EQUITY 84% 78% DIVIDEND PAYOUT Year EPS PAYOUT 49% 55% 60% % % % % % Source: PBIL and PBSL Research 25

26 Berger Paints Bangladesh Ltd. BERGERPBL January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category BERGERPBL Miscellaneous Market Price 1, W Range No of Share (Mn) Paid Up Cap (Mn) Market Cap (Mn) 63, Free Float (%) 5.00 Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 11,891 Trailing EPS Trailing PE A Berger Paints Limited is one of the oldest names in the paint industry and the country s major specialty paints business with products and ingredients dating back more than 250 years. Berger is the market leader in the organized and industrialized paints and varnishing market having around 55% total market share. Berger Paints Limited Demonstrate a Revenue CAGR of 17% since last 5 years and Net Profit After tax CAGR of 19%. Higher Return on Equity (ROE) which is reported to be more than 27% last year. The Debt to Equity Ratio is very low which indicating the company has a very little or no degree of financial risk. Since a large proportion of Berger s raw materials are imported, changes in currency exchange rates influence the result of the company s operations. Berger Paints Bangladesh Limited has entered into a joint venture agreement with Fosroc International Limited, United Kingdom, for setting up of a joint venture company with the name Berger Fosroc Limited in Bangladesh for the purpose of carrying on the business of manufacturing and selling construction chemicals. Berger Paints Bangladesh Limited has 50% share in the Joint Venture. The joint venture agreement was signed on January 31, 2018 and Berger Fosroc Limited was incorporated on 19 April ,799 10,893 12,283 14,649 OPERATING PROFIT (Mn) GROSS PROFIT (Mn) 16,533 1,279 1,605 2,087 2,612 2,450 7,261 7,505 12M Return 29.91% Dividend Yield 4.4% March Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 16, , , , Y Revenue CAGR 17% Gross Profit 7, , , , Y Op. Profit CAGR 18% Op. Profit 2, , , , Y NPAT CAGR 19% Net Profit 1, , , ,151.0 Gross Margin 45% Total Asset 9, , , ,632.6 Operating Margin 15% Total Debt Net Profit Margin 11% Debt/Equity 0.8% 5.5% 0.0% 3.1% ROE 27% ROE 27.1% 33.1% 34.5% 32.2% 5,371 4,392 3,402 NET PROFIT (Mn) 1,915 1,788 1,493 1, ROA 19% Debt to Equity Ratio 1% SHAREHOLDING (%) Sponsor/Director Government - Institute 1.77 Foreign 1.49 Public 1.74 DIVIDEND HISTORY Year Cash Stock % 0.0% % 0.0% % 0.0% % 0.0% % 100.0% Gross Margin 45.4% 49.6% 43.7% 40.3% Operating Margin 14.8% 17.8% 17.0% 14.7% PAT Margin 10.8% 13.1% 12.2% 10.6% ROE YoY Revenue Gr. 12.9% 19.3% 12.8% 23.8% 35% 31% 32% 33% 27% YoY PAT Gr. -6.6% 28.3% 29.7% 27.9% PRICE AND VOLUME DEBT/EQUITY 6% DIVIDEND PAYOUT Year EPS PAYOUT % % % % % Source: PBIL and PBSL Research 3% 2% 1% 0% 26

27 Bangladesh Steel Re-Rolling Mills Limited BSRMLTD January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category BSRMLTD Engineering Market Price W Range A BSRM Steel Mills Ltd. an associate of BSRM ltd., which is business of making billets, had been incurring losses since its inception till the first two quarters of year However, since then the company has recorded net profit after tax in each of the successive quarters. The Y-o-Y sales growth is remarkable even if with off peak period for the company during the period of July to September. 8,050 7,802 9,714 23,649 33,238 No of Share (Mn) Paid Up Cap (Mn) 2, Market Cap (Mn) Free Float (%) Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 758,835 Trailing EPS Trailing PE M Return % The increase in COGS due to the soar of raw material "scrap iron" prices in globally. The level of debt in the capital structure is higher and the company is using its net income to pay of its debt. However, GP margin is lingering in a historically low level, so there is good chance GP margin will increase from here. A sound revenue growth is expected. The New Year is expected to be backed by huge construction and development work. The diversified product of the company (i.e. BSRM ULTIMA) will gain the majority market share of the upcoming development work. Historical Price Earnings Ratio is higher than the current level of Price earnings ratio reflecting a possible opportunity to increase price level. OPERATING PROFIT (Mn) 3,865 2,572 1, GROSS PROFIT (Mn) 4,828 Dividend Yield 1.8% June Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 33, , , , Y Revenue CAGR 43% Gross Profit 4, , , Y Op. Profit CAGR 165% Op. Profit 3, , , Y NPAT CAGR 125% Net Profit 2, Gross Margin 15% Total Asset 76, , , ,940.1 Operating Margin 12% Total Debt 48, , , , Net Profit Margin 8% Debt/Equity 281.9% 241.0% 132.2% 151.5% ROE 16% ROE 16.3% 5.5% 5.7% 8.4% 3,237 1, NET PROFIT (Mn) 2, ROA 4% Debt to Equity Ratio 282% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign Public DIVIDEND HISTORY Year Cash Stock % 0.0% % 10.0% % 0.0% % 10.0% % 10.0% DIVIDEND PAYOUT Gross Margin 14.5% 13.7% 14.0% 5.9% Operating Margin 11.6% 10.9% 10.9% 2.7% 109 PAT Margin 8.4% 3.2% 6.1% 10.6% ROE 16% YoY Revenue Gr. 40.5% 143.5% 24.5% -3.1% YoY PAT Gr % 28.5% -28.9% 658.7% 8% PRICE AND VOLUME 6% 6% 1% DEBT/EQUITY 241% 282% Year EPS PAYOUT % % % % Source: PBIL and PBSL Research 151% 118% 132% 27

28 Summit Power Limited SUMITPOWER January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category SUMITPOWER Fuel & Power Market Price W Range No of Share (Mn) 1, Paid Up Cap (Mn) 10, Market Cap (Mn) 43, Free Float (%) Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 1,266,919 Trailing EPS 6.36 Trailing PE M Return 14.53% Dividend Yield 7.3% 5Y Revenue CAGR 32% A June Summit power being the largest Independent Power Producer (IPP) in the country, has total generation capacity of MW including all of its subsidiaries and associates. The company supplies electricity to Bangladesh Power Development Board (BPDB) and Bangladesh Rural Electrification Board (BREB). Today SPL owns and operates 15 (fifteen) power plants in different locations across the country. SPL plants are equipped with world class engines manufactured by renowned companies such as Wärtsilä Finland, Caterpillar - USA, and GE Jenbacher, Austria. Currently, out of total MW power plants that Summit Power owns as subsidiaries and associates, MW power plants have direct impact on the bottomline of the company. Two power plants of Summit Power Limited namely Gazipur II Power Plant (149 MW) and Gazipur I Power Plant (300 MW) were commissioned on 10 May, 2018 and 12 July, 2018 which had combinedly MW power generation capacity that entitled to Summit Power and thus enhanced generation capaicty of 31.2% from Q1, compared to corresponding period of the previous year. Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 18, , , , Y Op. Profit CAGR 12% 5Y NPAT CAGR 25% Gross Margin 29% Operating Margin 28% Net Profit Margin 29% ROE 16% Gross Profit 5, , , ,556.0 Op. Profit 5, , , ,156.0 Net Profit 5, , , ,219.0 Total Asset 64, , , ,044.0 Total Debt 6, , Debt/Equity 19.3% 21.1% 0.5% 2.4% ROE 15.8% 14.0% 12.7% 8.2% 6,109 10,013 11,427 16,214 OPERATING PROFIT (Mn) GROSS PROFIT (Mn) NET PROFIT (Mn) 18,468 3,312 3,156 3,132 4,178 5,248 3,818 3,556 2,185 2,219 3,252 3,610 4,365 4,596 5,405 5,274 ROA 8% Debt to Equity Ratio 19% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign 3.65 Public DIVIDEND HISTORY Year Cash Stock % 5.0% % 6.0% % 0.0% % 0.0% % 0.0% DIVIDEND PAYOUT Year EPS PAYOUT Gross Margin 29.3% 26.9% 28.5% 35.5% Operating Margin 28.4% 25.8% 27.4% 31.5% PAT Margin 28.6% 28.3% 31.6% 22.2% ROE 16% YoY Revenue Gr. 13.9% 41.9% 14.1% 63.9% 14% 13% YoY PAT Gr. 14.8% 27.3% 62.7% 1.6% 9% 8% PRICE AND VOLUME DEBT/EQUITY 21% 19% 12% % % % % % Source: PBIL and PBSL Research 2% 1% 28

29 Singer Bangladesh Limited SINGERBD January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category SINGERBD Engineering Market Price W Range No of Share (Mn) Paid Up Cap (Mn) Market Cap (Mn) Free Float (%) Trailing EPS Trailing PE M Return 19.66% A Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 217, Key revenue drivers are air conditioner (12.07%), television (21.04%) and home appliance (56.94%) have experienced a five year sales CAGR of 23.6%, 13.7% and 10.3% respectively. Singer Bangladesh has recorded 49% sales growth of panel television, 47% sales growth of washing machines, 42% sales growth of refrigerators, 40% sales growth of furniture and 36% sales growth of air conditioner in With the future growth of consumer durables industry, profitability of Singer Bangladesh Limited is likely to increase. International Appliances Limited, a 73.85% owned associate of Singer Bangladesh Limited has started commercial operation in July 2016 with a production capacity of 250,000 units. Singer Bangladesh Limited has earned BDT 10 million from this associate in this time. It is expected that the associate will generate more profit in the future. Organic demand growth due to the country s increasing Middle and Affluent Class (MAC) population coupled with higher disposable income levels will likely to give a boost to the company s topline for forseeable future. The revenue is sensitive to seasonality as Q2 (April-June) and Q3 (July-Sep) likely to show better figures while historcially Q1 EPS suffers the most. 6,605 7,262 6,911 9,008 OPERATING PROFIT (Mn) GROSS PROFIT (Mn) 11, ,185 2,594 3,119 Dividend Yield 3.0% December Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 11, , , , Y Revenue CAGR 14% Gross Profit 3, , , , Y Op. Profit CAGR 19% Op. Profit 1, Y NPAT CAGR 18% Net Profit Gross Margin 28% Total Asset 7, , , ,821.2 Operating Margin 11% Total Debt 3, , , , Net Profit Margin 7% Debt/Equity 137.5% 126.7% 91.8% 94.3% ROE 34% ROE 33.6% 28.1% 26.0% 23.7% 1,785 1,840 1,843 NET PROFIT (Mn) ROA 11% Debt to Equity Ratio 138% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign 7.52 Public DIVIDEND HISTORY Year Cash Stock % 25.0% % 25.0% % 0.0% % 0.0% % 0.0% DIVIDEND PAYOUT Year EPS PAYOUT Gross Margin 28.2% 28.8% 26.7% 25.3% Operating Margin 10.7% 10.4% 8.6% 7.9% PAT Margin 6.7% 6.1% 5.3% 5.0% ROE 34% YoY Revenue Gr. 22.8% 30.3% -4.8% 9.9% 28% 26% YoY PAT Gr. 36.6% 48.2% 1.7% -5.2% 24% 15% PRICE AND VOLUME DEBT/EQUITY 127% 138% 94% 92% % % % % % Source: PBIL and PBSL Research 1% 29

30 MJL Bangladesh Limited MJLBD January 7, 2019 MARKET PROFILE INVESTMENT RATIONALE REVENUE (Mn) Script Sector Category MJLBD Fuel & Power Market Price W Range No of Share (Mn) Paid Up Cap (Mn) 3, Market Cap (Mn) 31, Free Float (%) Sponsor (%) NAVPS Price/Nav (Times) Yr ADTV 152,880 Trailing EPS 6.55 Trailing PE M Return -1.88% A MJL Bangladesh Limited (MJLBD), a Joint Venture in the downstream petroleum industry between Jamuna Oil Company Ltd. (owns 19.45%) and EC Securities Ltd (owns 52.06%), subsidiary of the East Coast Group, was corporated in MJL holds 26% of market share of the lubricant market in Bangladesh. During the year of 2019 Omera Petroleum (OPL) is expected to double its LPG capacity to 300,000 MTPA. MJL acquired its second and Bangladesh s largest oceangoing Aframax oil-tanker of 107,091 DWT in which would help accelerate business momentum. Omera Petroleum Ltd ( OPL- a 62.50% subsidiary of MJLBD) and Omera Cylinders Ltd (OCL- a 98.77% subsidiary of MJLBD) are two of the major subsidiaries of MJLBD which are in growing LPG business which contributed 26% to consolidated PBT in MJLs' aframax oil-tanker was out of operation for 60 days which hampered revenue collection from oil tanker business. In 2019 its expected to be in full operation which aid to continue growth in revenue. Raw material price of MJL is directly correlated with the oil price. Due to increase in oil price, MJLs' COGS was higher in last year. 8,141 9,350 15,839 15,052 OPERATING PROFIT (Mn) GROSS PROFIT (Mn) 18,660 1,221 1,785 2,964 3,330 3,862 4,193 4,558 4,594 Dividend Yield 4.0% June Financial Snapshoots at a Glance [Amount in BDT. Mn] KEY FINANCIAL RATIOS Revenue 18, , , , Y Revenue CAGR 23% Gross Profit 4, , , , Y Op. Profit CAGR 33% Op. Profit 3, , , , Y NPAT CAGR 35% Net Profit 2, , , ,044.6 Gross Margin 25% Total Asset 30, , , ,448.5 Operating Margin 21% Total Debt 8, , , , Net Profit Margin 12% Debt/Equity 66.2% 61.7% 56.8% 75.4% ROE 18% ROE 18.5% 19.1% 20.3% 12.2% 2,181 1,497 NET PROFIT (Mn) 2,294 2,129 1,975 1, ROA Debt to Equity Ratio 66% SHAREHOLDING (%) Sponsor/Director Government - Institute Foreign 0.38 Public DIVIDEND HISTORY Year Cash Stock % 15.0% % 0.0% % 5.0% % 0.0% % 10.0% DIVIDEND PAYOUT 8% Year EPS PAYOUT % % % % % Gross Margin 24.6% 30.3% 26.5% 23.3% Operating Margin 20.7% 22.1% 18.7% 19.1% PAT Margin 12.3% 14.1% 12.5% 11.2% YoY Revenue Gr. 24.0% -5.0% 69.4% 14.9% YoY PAT Gr. 7.8% 7.8% 89.1% 52.5% PRICE AND VOLUME Source: PBIL and PBSL Research ROE 20% 19% 18% 12% 9% DEBT/EQUITY 75% 58% 57% 66% 62% 30