Siemens. Upgrade to Buy. Rs720. Order-book at all-time high; earnings visibility improves

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1 Update SECTOR: ENGINEERING BSE SENSEX S&P CNX 19,208 5,760 Rs720 Siemens Upgrade to Buy Bloomberg SIEM IN Reuters SIEM.BO Equity Shares (m) Week Range (Rs) 765/486 1,6,12 Rel. Perf. (%) -1/24/29 M.Cap. (Rs b) M.Cap. (US$ b) 5.2 Y/E SEPTEMBER E 2011E Net Sales(Rs b) EBITDA (Rs b) Net Profit (Rs b) EPS (Rs) EPS Gr. (%) BV/Share (Rs) P/E (x) P/BV (x) EV/EBITDA (x) EV/ Sales (x) RoE (%) RoCE (%) SHAREHOLDING PATTERN % (JUN-10) Others, 17.5 Foreign, 4.0 Domestic Inst, 23.4 STOCK PERFORMANCE (1 YEAR) Sep-09 Dec-09 Promoter 55.2 Siemens Sensex - Rebased Mar-10 Jun-10 Sep-10 Order-book at all-time high; earnings visibility improves 41% growth in order intake in the last one year; momentum picking up in all key sectors; expect 26% earnings CAGR over FY09-12 Strong play on Infrastructure, Industry and Transportation: A diversified Engineering company, with exposure to Power (40% of its revenues), Industry (40% of sales), Transportation (14% of sales), Healthcare, etc, Siemens is one of the biggest beneficiaries of the revival in the capex cycle in India. Domestic T&D: Siemens is a technology leader in HVAC and HVDC transmission systems, and stands to benefit significantly from investments in the 765kV space. It has invested meaningfully in setting up manufacturing facilities for high-end products such as extra-high voltage transformers and GIS systems, which should bear fruit in the next few years. Industry: Siemens has strong presence in automation, drives and projects across industries and stands to benefit from the revival in industrial capex. Railways: Siemens has set up manufacturing plants for several key products like traction motors. It is among the key beneficiaries of investments in railways, metro rail systems and other large projects like the Dedicated Freight Corridor. Key partner in Siemens AG's global network: Siemens has received orders worth Rs95b from Qatar in the last four years, constituting ~20% of its total order intake during the period. We believe that the company will continue to be Siemens AG's growth vehicle in the Middle East and North African markets due to cost advantage. Order momentum picks up: Siemens' total order intake in the last 12 months (June June 2010) has been Rs120b, a growth of 41%. Order intake was boosted by a large order, valued at Rs24.91b, from Kahramaa, Qatar. Currently, the company has an order book of Rs135b, up 34%. In the current quarter (ending September 2010), Siemens in consortium with Siemens AG, has received another large order from Torrent Power to set up two combined-cycle power plants. We expect the company to end FY10 (September-ending) with an order-book of Rs154b, up 51%. Order flow momentum is likely to remain strong in the near term, with possibility of more mega orders. Margins on track: Siemens' margins suffered in FY07 and FY08 on account of losses on two large orders. EBITDA margin improved to 12.1% in FY09. We expect EBITDA margin to expand further to 13-14% in the next two years due to higher indigenization, better product mix, and better project management. Valuation and view: We are revising our earnings estimates upwards by 3% for FY10 and by 12% for FY11. With an estimated 26% earnings CAGR over FY10-12, Siemens is one of India's fastest growing engineering companies. Strong order book and continuing momentum provides earnings visibility. The company is ideally positioned to capitalize on opportunities in several sectors like power generation, wind power and transportation. We expect it to be a key beneficiary of Siemens AG's widening footprint in the Middle East. Any large order from Qatar can result in a substantial upgrade in our earnings estimates. We upgrade the stock to Buy, with a target price of Rs907. Dhirendra Tiwari (Dhirendra.Tiwari@MotilalOswal.com); Tel: Navneet Iyengar (Navneet.Iyengar@MotilalOswal.com); Tel:

2 Multiple growth catalysts - diversified product profile to help sustain momentum Suitable mix of projects, products and services will partly insulate the company from sharp cyclical downturns A diversified Engineering company, with exposure to Power (40% of its revenues), Industry (40% of sales), Transportation (14% of sales), Healthcare, etc, Siemens is one of the biggest beneficiaries of the revival in the capex cycle in India. Power sector: Siemens is a key player in the T&D segment, which focus on transformers, substations and automation. It has a market share of nearly one-third in all 765kV substations awarded in India. It has also set up a world-class extra-high voltage transformer and GIS manufacturing factory, which will strengthen its position in the Indian T&D market. It is aggressively targeting the e-bop (electrical Balanceof-Plant) segment of the generation segment, which will provide additional growth opportunity. Railways and urban transport are key growth areas: While Siemens benefits from investments in a vast number of infrastructure sectors, Railways accounts for a large chunk of the overall pie. It is a dominant player, with local manufacturing capacity for traction motors, rolling stock and control panels. The company has bagged several key railway projects and will continue to benefit from overall investments in the sector. Dominant position in industrial automation and drives: Siemens continues to enjoy leadership position across various industries. It has a strong presence in motors, automation and drives, and industrial turnkey projects. Exports accounted for 25% of sales in FY09 A key player in Siemens AG's global footprint Siemens has received orders worth Rs95b from Qatar in the last four years, constituting ~20% of its total order intake during the period. We believe that the company will continue to be Siemens AG's growth vehicle in the Middle East and North African markets due to cost advantage. Many of Siemens India's facilities are 'centres of competence' for products such as power and instrument transformers, industrial steam turbines and gas-insulated switchgear. These products meet global quality standards and the parent will outsource their manufacturing to Siemens India to meet its requirements in developing countries. International orders account for nearly 25% of the orderbook; more orders likely Strong pick-up in order flows, order book up 34% to Rs135b We expect Siemens to post a strong 60% growth in order intake in FY10, after a lull of nearly three years. After bagging a large order from Qatar in October 2005 and subsequent repeat orders in 2006, Siemens India failed to win large orders until 4QFY09, when it received a Rs7.4b order (Siemens India's part) from Adani Power to set up a 765kV line to evacuate power from Adani's under-execution 6,600MW power plant in Gujarat. This was followed by two large orders from Kahramaa, Qatar, valued at Rs6.08b and Rs24.91b in the last few months. Delays in Power Grid related orders have also led to stagnation in order book. However, order book outlook is improving now, with orders from Power Grid starting to accelerate now. Order flow momentum is likely to remain strong in the near term. 13 September

3 ORDERS GROWING AT BRISK PACE AFTER TWO YEARS Order-intake in FY10 is boosted by two large orders, aggregating over Rs5b Order intake (Rsb) Grow th (%) FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10E QUARTERLY ORDER-INTAKE Company received a large 42 order of Rs 25b from its key client in Qatar, Kahrama, in 1QFY QFY06 2QFY06 3QFY06 4QFY06 1QFY07 2QFY07 3QFY07 4QFY07 1QFY08 2QFY08 3QFY08 4QFY08 1QFY09 2QFY09 3QFY09 4QFY09 1QFY10 2QFY10 3QFY10 BOOK-TO-BILL AT ALL TIME HIGH LEVELS Order book (Rs m) BTB 1.7 High Book-to-Bill will ensure strong growth visibility FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10E BTB IMPROVES AFTER NINE STRAIGHT QUARTERS Order Book (Rs b) BTB (x,ttm) QFY06 2QFY06 3QFY06 4QFY06 1QFY07 2QFY07 3QFY07 4QFY07 1QFY08 2QFY08 3QFY08 4QFY08 1QFY09 2QFY09 3QFY09 4QFY09 1QFY10 2QFY10 3QFY10 13 September

4 RECEIVED TWO MEGA-ORDERS IN 2010 CLIENT VALUE DATE EXECUTION PROJECT (RS M) Torrent Power NA 2-Ju Months Two CCPP with total 1600 MW capacity Gurgaon Metro NA 11-May Months Total rail Solutions for 6.1 km stretch of line PGCIL, India 1,000 2-Feb months 1 unit of 765 KV Substation job. Kahramaa, Qatar 24, Jan months Total order Rs29,560m, with Siemens AG, substation works. Kahramaa, Qatar 6, Nov months Cables works. Ezdan, Qatar 3,420 8-Oct months Ezdan Real Estate QSC, substation jobs, with SAG (Rs610m). PGCIL, India 3, Sep months 2 units of 765 KV substation jobs. PGCIL 1, Jul months I unit of 765 KV substation job. Vedanta Alumunium 1, Jun-09 - HV distribution system at Smelter plant at Jharsuguda, Orissa Kahramaa, Qatar May months Air insulated Circuit breakers. Adani Power 7, Apr-08 - With SAG (6,600m), EPC contract to set up a bipolar 500 KV HVDC line, transmission capacity of 2,500 MW. PGCIL: Powergrid Corporation of India, Kahramaa: Qatar General Electricity & Water Corporation Provisioning for losses on two large projects adversely impacted margins in F07 and FY08 EBITDA margin up sharply Siemens' margins have been stable at 9-10% over FY However, there has been considerable volatility on quarterly basis. The company incurred losses on EPC contract to execute Torrent's combined cycle power project (1,350MW) bagged in FY05. It provided a significant amount for 'anticipated losses' on this project during 3QFY07 (quarter ended June 2007) and again in 2QFY08 (quarter ended June 2008). 2QFY08 earnings were particularly impacted, as the company made a provision of Rs1.09b against anticipated losses and made a sales reversal of Rs1.17b. Profitability has improved sharply in FY09, as margins expanded across segments. EBITDA MARGIN IS IMPROVING (%) FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10E FY11E FY12E Aggressive capex - to invest Rs16b in the next three years Siemens India has invested more than Rs6b in the past four years to build fresh capacities. It has announced its intent to invest Rs16b over the next three years. A large part of its exports will be aimed at the renewable energy sector. The company is also likely to make India as a hub for value-priced products. Higher localization should boost margins. 13 September

5 The company has also made mid-sized acquisitions in core product areas of building technologies, electrical products like switchgear, and medical diagnostics. CAPEX PRODUCTS DATE CAP COST LOCATION COMMENTS (P.A.) (RS M) Industrial steam turbines Jan-07 NA 300 Vadodara Capacity being trippled, cost Rs2,750m, by Transformer factory Dec-07 15,000 2,000 Thane 800 KV, HVDC, Furnace MVA applications Instrument Transformer Aug-08 3,000 units 250 Aurangabad SF6 insulated CT, PT, etc. Gas Insulated switchgear Apr-09 NA 400 Aurangabad Wide voltage range , 145, 245, 400 kv range INCREASING LOCALIZATION IMPROVING PROJECT MARGINS With projects accounting for over 25% of sales, level of indigenization will have strong bearing on margins Project Sales (Rsb) Projects (% of Total Rev) Project Boughtout (% of Project sales) 119% % 91% 93% 97% 88% 34 84% 15 50% 49% 40% 6 16% 19% % 33% FY03 FY04 FY05 FY06 FY07 FY08 FY09 13 September

6 Acceleration in T&D investments a key growth driver PLANNED INVESTMENT OUTLAY (RS B) Transmission is expected to be fastest growing sector Source: CEA Transmission investment keeps pace under Eleventh Plan The transmission sector has invested ~Rs550b during FY08-10, amounting to nearly 40% of planned investments. Transmission investment, being back-ended, should accelerate over the next two years. To facilitate inter-regional transfer of power, inter-regional transmission capacity is being expanded to 38,650MW by the end the Plan from 20,750MW as at March 2009, at an investment of ~Rs550b by Power Grid (total 11th Plan). Further, an investment of Rs414b will be required to evacuate power generated from nearly 35GW of power capacity to be commissioned in the next five years by private developers. IR CAPACITY PLANNED (GW) Buoyed by doubling of interregional transmission capacity every five years Source: Ministry of Power/CEA PGCIL to meet its investment target by FY12 Power Grid Corporation of India (PGCIL), the central transmission utility, is likely to achieve the capex of Rs550b targeted under the Eleventh Plan, despite meaningful delays in generation capacity additions. This is largely due to incremental capex towards transmission projects linked to generation capacities being set up by private sector entities, which were not part of the original estimates. Also, ~40% of PGCIL's capex is towards system strengthening, not completely linked to generation capacity additions. 13 September

7 During FY08-10, PGCIL's capex was Rs254b and the targeted spending in FY11-12 is Rs286b. Also, under the Twelfth Plan (FY13-17), targeted capex is Rs1t+, ~2x the Eleventh Plan capex, driven by investments in EHV transmission corridors for private IPP projects and system strengthening. EXPECT PGCIL TO ACHIEVE ELEVENTH PLAN TARGETS MEANINGFUL ACCELERATION IN PLAN-WISE CAPEX BY PGCIL (RS B) Multi-fold jump in demand for 765kV transformers and substations With growing emphasis on large-scale power projects based on super critical technology, extra-high voltage (EHV) transmission segment will see increased activity, particularly in the 765kV transformer range. The 765kV system will account for 29% of total transformation capacity addition proposed in the Eleventh Plan, at 51,000MVA. This number is expected to increase by 2x to 110,000MVA, 39% of the planned capacity addition during the Twelfth Plan. 78% of the transformer ordering by PGCIL in FY09 and FY10 has been in the 765kV/500MVA range (333MVA in a few cases). Companies in this segment are likely to benefit on account of technological barriers to entry and limited competition compared to other growing transformer segments. PLAN-WISE CAPACITY CAPACITY AT END OF PLAN PERIOD PLAN-WISE ADDITION (MVA) 10 TH PLAN 11 TH PLAN (E) 12 TH PLAN (E) 10 TH PLAN 11 TH PLAN (E) 12 TH PLAN (E) 765kV 2,000 53, ,000 2,000 51, , kV 92, , ,000 32,562 52,058 80, /220kV 156, , ,000 40,134 73,503 95,000 Total 251, , ,000 74, , ,000 Source: CEA Expect Siemens to gain market share T&D is a core area of growth for Siemens. The company has the capability to set up Extra High Voltage Transmission Systems like HVAC (High Voltage Alternating Current) and HVDC (High Voltage Direct Current). It has set up a large advanced transformer factory, with a capacity of 15,000 MVA, which was commissioned in December We expect Siemens to become a key player in 765kV transformer market in the next couple of years (no order as yet). Siemens has already bagged a third of PGCIL's 765kV substation orders. 13 September

8 PGCIL: 765KV SUBSTATION MARKET SHARE (IN NOS.) PGCIL: 765KV TRANSFORMER MARKET (IN NOS.) Qatar accounts for nearly 20% of Siemens' orderintake in last four years; strong outlook for more opportunities from Qatar and neighbouring countries Qatar: boosting Siemens India's growth Over the last five years, Siemens India has bagged several projects in consortium with Siemens AG. With a total value of Rs95b, these projects account for ~20% of Siemens India's order intake since FY06. Its key client in Qatar is Qatar General Water and Electricity Corporation (Kahramaa), the country's sole power and water distribution company. Siemens has also received an order from Ezdan Real Estate QSC. We believe that Siemens will continue to be among the biggest beneficiaries of the infrastructure investments in the Middle East, particularly Qatar. ORDERS FROM QATAR (RS M) DATE SIEMENS SIEMENS MONTHS SCOPE INDIA AG 11-Oct-05 13,900 1, HV substations and 600 km of high voltage cables. Part of Phase V of Qatar Grid. 28-Nov-05 8,500 1, units of GI substations. Part of Phase V of Qatar Grid. 9-Mar-06 5,300 1, units of 220/132/66 KV substations. Part of Phase VI of Qatar Grid. 22-Nov-06 36,000 4, substations, extension of 14 and renovation of 10 substations. Part of Phase VII of Grid. 4-May units of Air insulated CBs 8-Oct-09 3, Ezdan Real Estate QSC, 4 substations 220 KV/ 66 kv/11 kv. 10-Nov-09 6, Cable works. 19-Jan-10 24,910 4, substations and 5 modifications. Part of phase IX of Qatar Grid. All projects from Kahramaa, except the one from Ezdan Expect more orders from Middle East Qatar is setting up three large power projects with aggregate capacity of 6,730MW, which will raise the installed capacity to 10,000MW by Kahramaa, to meet the transmission requirement, is engaged in an 'Electricity Network Expansion Programme' comprising of several phases. Phase-VII of the project was completed in 2QCY09, involving total investment of US$2b. Even as Phase-VIII is under progress, the company has started ordering out various packages under Phase-IX. Phase IX will cost over US$2b and will be completed by This phase will involve construction of 22 substations, 3 underground substations, 375km of cables and 62km of overhead lines. 13 September

9 Siemens AG is has a strong presence in the country and is likely to be a key partner in infrastructure development. This will include transmission lines, transportation, aviation, etc. The company's recent successes in Phase-IX of Kahramaa Transmission Grid Project augers well. We believe that given the manufacturing and services capability that Siemens India has, it will be the key beneficiary of Siemens AG's widening footprint in the region. Qatar orders yield good margins Profitability for Kahramaa orders has been impressive and broadly in line with domestic orders. Having already established the basic infrastructure for project implementation in Qatar, Siemens will continue to enjoy good margins from ongoing and future projects. STRONG PROFITABILITY ON EXPORTS, BOOSTING TRANSMISSION EBIT MARGIN Sharp jump in transmission margins in last few quarters has been aided by Qatar orders received in 2006; now completed 13 September

10 Industrial segment: strong pick-up in sales After a brief hiatus in late 2008 and 2009, the capex cycle is moving ahead. Despite concerns on inflation and possibility of interest rate hikes, the domestic industry continues to grow at a rapid pace, barring minor aberrations. EXHIBIT: CAPITAL GOODS GROW AT A FAST PACE Siemens has strong presence across industries; in automation, drives and projects and stands to benefit from reviving capex cycles STRUCTURE OF SIEMENS INDUSTRY SEGMENT INDUSTRY SEGMENTS % OF SEGMENT KEY PRODUCTS KEY COMPETITORS SALES Industry Automation 22 Automation products and solutions ABB, Honeywell Drive Technologies 27 Motors, drives, turbines, drive ABB, Crompton, BHEL systems, panels. Building Technologies 2 Building management Solutions Honeywell Industry Solutions 24 Large industrial projects ABB, Honeywell Mobility (Railway) 25 Railways- Traction motors, signalling BHEL, Alstom, equip; Aviation products and solutions Bombardier Mobility: huge potential Siemens' mobility division is a key player in rail transport solutions. Its units at Kalwa (Thane) and Nashik have advanced manufacturing capacity to produce railway propulsion equipment. The division has bagged several key projects in the past from Indian Railways. Recently, it received an order from Delhi Metro for electrification of the metro line from the airport as also the baggage check-in facility at the airport. Despite slowdown in the general industrial environment, the mobility division has posted strong growth in FY09. With investment pipeline that the Indian Railways has and likely progress on the Dedicated Freight Corridor (Rs570b), coupled with growing expenditure on modernisation on Indian airports, Siemens' mobility business will be among its fastest growing businesses. The mobility business has been incurring losses for the past two years due to cost and time over-run on a large project. The division reported a profit in 1QFY10. With larger project portfolio and higher localization, this business should remain profitable. 13 September

11 Earnings CAGR of 26% over FY09-12E KEY EARNINGS ASSUMPTIONS FY05 FY06 FY07 FY08 FY09 FY10E FY11E FY12E Order Intake (Rs b) Growth (%) (14.0) Order Book (Rs b) Revenues (Rs b) Execution Ratio (x) Book to Bill (x) Cost Assumptions (%) RM/Sales Employee Cost/Sales Other Expenses/Sales Total Cost/Sales EBITDA Margin STRONG ORDER INTAKE IN FY10 Order intake in FY10 is boosted by two large orders, aggregating over Rs5b BTB AT ALL TIME HIGH Order intake expectations for FY11-12 do not include upsides from new lines of business like WTG 13 September

12 3-YEAR SALES CAGR OF 22% Revenue growth will be boosted by large orders received in FY10 and pick up in industrial products MARGINS STRUCTURALLY AT HIGHER LEVELS Margins will be supported by better project profitability, growing product portfolio and improving capacity utilization PAT CAGR OF 26% Consistent profitability track record, except FY08 13 September

13 Valuation and view Valuation in FY08-09 impacted due to losses on a couple of large projects, divestment of software subsidiary and slowdown in core business; recent rerating driven by improving earnings visibility Siemens is among the best performing capital goods stocks over the last one year, outperforming the Sensex by 29%. However, before March 2009, the stock underwent a period of underperformance, as well. Two events had acted as key de-rating catalysts in The company incurred substantial losses on its EPC contract to set up a 1,147MW gas-based power project for Torrent Power. This resulted in significant write-offs in 3QFY07 and 2QFY08, thereby impacting margins. The stock fell 10% on 25 April 2008, after 2QFY08 results were announced. This also raised concerns on the company's capability to maintain margins in large projects. 2. SISL, its wholly-owned software subsidiary, which accounted for 12% of sales and 20% of profit in FY07, posted poor results for FY08 and was also divested to Siemens AG. This raised concerns on Siemens AG's strategy with respect to its Indian operations. We upgrade the stock to buy with a target price of Rs907 With an estimated 26% earnings CAGR over FY09-12, Siemens is one of India's fastest growing engineering companies. Strong order book and continuing momentum provides earnings visibility. The company is ideally positioned to capitalize on opportunities in several sectors like power generation, wind power and transportation. We believe that growth can be sustained for a much longer timeframe. We expect Siemens to be a key beneficiary of the parent's outsourcing needs. Any large order from Qatar can result in a substantial upgrade in our earnings estimates. We upgrade the stock to Buy, with a target price of Rs907 (30x FY11E EPS). SIEMENS V/S ABB - P/E BAND SIEMENS P/E PREMIUM/DISCOUNT TO ABB (%) Source: Bloomberg/MOSL 13 September

14 SIEMENS P/E (X) SIEMENS P/BV (X) Source: Bloomberg/MOSL 13 September

15 Key risks Business restructuring: During the last three years, Siemens India has divested businesses such as Information & Communication, Telecom, Automotive and Information Technology to its parent. Information & Communication and Telecom (SPCNL) businesses, which contributed ~1.4% and ~4.8% of FY07 revenues, were divested in FY07. The Automotive (VDO) business, which was divested in 1QFY08, contributed ~1% of FY07 revenues. Information Technology (SISL), which was divested in 1QFY09, contributed ~10% of FY08 revenues. Though we do not see any meaningful business restructuring in the foreseeable future, any change in Siemens AG's global strategy will impact Indian operations and hence Siemens India's valuations. Diverse product mix makes quarterly earnings volatile: Siemens has a presence in many segments of the electrical engineering industry, which have different pricing and profitability trends. Moreover, long-gestation projects have started to dominate the order book. As a result, one should expect considerable volatility in quarterly margins. Earnings volatility may have an impact on stock performance in the short-term. EBITDA MARGIN (%) Slowdown in economy, adverse exchange and interest rate movement: (1) A substantial hike in interest rates can derail capex plans of corporates, thereby impacting capital goods manufacturers like Siemens. (2) Siemens reported foreign exchange gain of Rs1.1b in FY08 and Rs2.1b in FY09. In the first three quarters of FY10, the company has posted forex loss Rs1.8b. Sharp movement in exchange rates can adversely impact reported profits. 13 September

16 Financials and Valuation 13 September

17 NOTES 13 September

18 For more copies or other information, contact Institutional: Navin Agarwal. Retail: Manish Shah Phone: (91-22) Fax: (91-22) Motilal Oswal Securities Ltd, 3rd Floor, Hoechst House, Nariman Point, Mumbai This report is for the personal information of the authorized recipient and does not construe to be any investment, legal or taxation advice to you. Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been furnished to you solely for your information and should not be reproduced or redistributed to any other person in any form. The report is based upon information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied upon such. MOSt or any of its affiliates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. MOSt or any of its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement. The recipients of this report should rely on their own investigations. MOSt and/or its affiliates and/or employees may have interests/ positions, financial or otherwise in the securities mentioned in this report. To enhance transparency, MOSt has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report. Disclosure of Interest Statement Siemens 1. Analyst ownership of the stock No 2. Group/Directors ownership of the stock No 3. Broking relationship with company covered No 4. Investment Banking relationship with company covered No This information is subject to change without any prior notice. MOSt reserves the right to make modifications and alternations to this statement as may be required from time to time. Nevertheless, MOSt is committed to providing independent and transparent recommendations to its clients, and would be happy to provide information in response to specific client queries. 13 September