Enclosure No. 3. No. 106/2017. November 3, 2017

Transcription

1 Enclosure No. 3 -TRANSLATION- The English Translation of the Independent Financial Advisor s Opinion has been prepared solely for the convenience of foreign shareholders of Principal Capital Public Company Limited and should not be relied upon as the definitive and official document. The Thai language version of the Independent Financial Advisor s Opinion is the definitive and official document and shall prevail in all aspects in the event of any inconsistency with this English Translation. No. 106/2017 November 3, 2017 Subject: Opinion of the Independent Financial Advisor concerning the acquisition of assets and the connected transaction of Principal Capital PCL. in an acquisition of the businesses of Alliance Medical Asia Company Limited s group of companies To: The Audit Committee and the Shareholders Principal Capital PCL. Attachment: 1) Profile of Alliance Medical Asia Co., Ltd. and its six direct and indirect subsidiaries and overview of hospital business 2) Summary of the Sale and Purchase Agreement of Alliance Medical Asia Co., Ltd. s Shares between Miss Satita Viddayakorn and Principal Capital PCL. Overview of business operation and performance of Principal Capital PCL. is presented in Clause 15 of the Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction, enclosed with the Notice of the Extraordinary General Meeting of Shareholders (Enclosure No. 2). References: 1) Resolutions of the Board of Directors Meeting of Principal Capital PCL. No. 7/2017 held on September 25, ) Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction of Principal Capital PCL. dated September 25, ) Annual registration statements (Form 56-1) of Principal Capital PCL. for the periods ended December 31, 2014, 2015 and ) Financial statements audited by the certified public accountant of Principal Capital PCL. for the 12-month periods ended December 31, and reviewed financial statements for the 6-month period ended June 30, ) Pro-forma consolidated financial statements of Alliance Medical Asia Co., Ltd., which have not yet been audited or reviewed by the certified public accountant, for the year ended December 31, 2016 and the 6-month period ended June 30, 2017, prepared by the Company s management in consultation with its auditor. 6) Pro-forma consolidated financial statements after the acquisition of Alliance Medical Asia Co., Ltd. s shares by the Company, which have not yet been audited or reviewed by the certified public accountant, for the year ended December 31, 2016 and the 6-month period ended June 30, 2017, prepared by the Company in consultation with its auditor. 7) Financial statements audited by the certified public accountant of Alliance Medical Asia Co., Ltd. and its three subsidiaries (Pitsanuloke Medical Co., Ltd., Paknampo Hospital Co., Ltd. and P.N.P Hospital Co., Ltd.) for the 12-month periods ended December 31, and one subsidiary (Union Pichit Doctors Co., Ltd.) for the 12-month periods ended September 30, and the 3-month period ended December 31, 2016, and management accounts of all such entities for the 6- month period ended June 30, 2017 which have not yet been audited or reviewed by the certified public accountant. 8) Certificate of Incorporation, Memorandum of Association, and other information and documents, including interviews with the management and concerned staff of Principal Capital PCL., Alliance Medical Asia Co., Ltd., and direct and indirect subsidiaries of Alliance Medical Asia Co., Ltd. 9) Three property appraisal reports of Pitsanuloke Medical Co., Ltd. No. 2673/2560 dated September 6, 2017 (land on which Pitsanuvej Uttaradit Hospital will be located), No. 2706/2560 dated September 6, 2017 and No. 3011/2560 dated October 2, 2017, prepared by Year Appraisal Co., Ltd. Capital Advantage Co., Ltd. 6 6 / 2 2 L a d p r a o 8 0, W a n g t h o n g l a n g, B a n g k o k , T h a i l a n d Tel: Fax:

2 10) Two property appraisal reports of Union Pichit Doctors Co., Ltd. No. 2684/2560 dated September 5, 2017 and No. 3012/2560 dated October 2, 2017, prepared by Year Appraisal Co., Ltd. 11) Five property appraisal reports of Paknampo Hospital Co., Ltd. No. 2501/2560 dated August 23, 2017, No. 2783/2560 dated September 12, 2017, No. 2803/2560 dated September 13, 2017, No. 2984/2560 dated September 13, 2017 and No. 3013/2560 dated October 2, 2017, prepared by Year Appraisal Co., Ltd. Disclaimers: 1) The study results of Capital Advantage Co., Ltd. ( CapAd or Independent Financial Advisor or IFA ) in this report were based on information and assumptions provided by the management of Principal Capital PCL., Alliance Medical Asia Co., Ltd. and subsidiaries and information disclosed publicly by the Company on websites of the Office of the Securities and Exchange Commission ( and the Stock Exchange of Thailand ( 2) CapAd shall not be responsible for profits or losses and any impacts resulting from this transaction. 3) CapAd conducted the study with knowledge, skills and carefulness and on the basis of professional ethics. 4) CapAd has considered and provided opinion based on the situation and information prevailing at the present time. If such situation and information have changed significantly, the study results in this report may be affected. The Board of Directors Meeting of Principal Capital PCL. (the Company or PRINC ) No. 7/2017 held on September 25, 2017 resolved to propose to the Extraordinary General Meeting of Shareholders No. 1/2017 (the EGM ) to consider and approve an acquisition of the businesses of Alliance Medical Asia Co., Ltd. s group of companies through purchase of 268,374,998 shares representing approximately 99.99% of total issued and paid-up shares of Alliance Medical Asia Co., Ltd. 1 ( AMA ) from AMA s existing shareholders, who are the connected persons, at a price of approximately Baht per share totaling not more than Baht 2,000,000,000, details of which are as follows: (a) Purchase of 146,852,399 ordinary shares, equivalent to approximately 54.72% of total issued and paid-up shares of AMA, from Miss Satita Viddayakorn ( Miss Satita ) at a total consideration of not more than Baht 1,094,382,115.28, whereas Miss Satita is a connected person because she is the Company s major shareholder and is daughter of Dr. Satit Viddayakorn who is the Company s director and major shareholder; (b) Purchase of 118,750,600 ordinary shares and 1,372,000 preferred shares, totaling 120,122,600 shares or equivalent to approximately 44.76% of total issued and paid-up shares of AMA, from Vantage Point Management Ltd. ( Vantage Point ) at a total consideration of not more than Baht 895,184,729.54, whereas Vantage Point is a connected person because it is a juristic entity of which Viddayakorn Family is the ultimate beneficial owner; and (c) Purchase of 1,399,999 ordinary shares, equivalent to approximately 0.52% of total issued and paid-up shares of AMA, from Mr. Sirichai Towiriyawate ( Mr. Sirichai ) at a total consideration of not more than Baht 10,433,155.18, whereas Mr. Sirichai is a connected person because he is one of the Company s executives, currently in a position of the Risk Management and Investment Director. The group of sellers above agrees to transfer the ownership of AMA shares, to be sold and purchased in this transaction, entirely and immediately to the Company at the same time on the date of shares acquisition by the Company. In this respect, the Company will make payment for those shares to Miss Satita, Vantage Point and Mr. Sirichai (collectively called Seller Group ) in cash, 1 AMA is a limited company established under Thai law. It currently operates as a holding company and holds shares, directly and indirectly, in six subsidiaries, consisting of two direct subsidiaries: (1) Pitsanuloke Medical Co., Ltd. ( PSV ) (60% owned by AMA) and (2) Paknampo Hospital Co., Ltd. ( PNP ) (90.92% owned by AMA), and four indirect subsidiaries: (3) Union Pichit Doctors Co., Ltd. ( SHV ) (99.99% owned by PSV), (4) Pitsanuvej Uttaradit Hospital Co., Ltd. ( PUH ) (99.99% owned by PSV), (5) Pitsanuvej Pattana Co., Ltd. ( PPC ) (99.99% owned by PSV), and (6) P.N.P Hospital Co., Ltd. ( PNPH ) (99.99% owned by PNP), (AMA and six subsidiaries in (1) - (6) to be collectively called AMA Group ). AMA Group has had long experience in the operation of private hospital business in Thailand, owning and operating several leading and well-known hospitals in the lower northern part of the country such as Pitsanuvej Hospital in Pitsanuloke Province, Paknampo Hospital and Paknampo 2 Hospital in Nakhon Sawan Province, etc. Capital Advantage Company Limited Page 2/89

3 whereby half of the total consideration (Baht 1,000 million) will be paid on Share Sale and Purchase Date and the remaining half of the total consideration (Baht 1,000 million) will be paid within 12 months from thesale and Purchase Agreement Date. Please see more details of the share payment in Part 1 Clause 1.6 of this report. The above transaction is deemed as an acquisition of assets pursuant to the Notification of the Capital Market Supervisory Board No. TorChor. 20/2551 Re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets and the Notification of the Board of Governors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Acquisition or Disposition of Assets B.E (the Notifications on Acquisition or Disposition of Assets ). The highest transaction size is equal to 35.61%, calculated on a net tangible asset criteria according to the Company s consolidated financial statements for the 6-month period ended June 30, 2017 and AMA s pro-forma consolidated financial statements for the 6-month period ended June 30, Therefore, such transaction constitutes a Type 2 transaction under the Notification on Acquisition or Disposition of Assets, which is defined as a transaction with size equal to or higher than 15% but less than 50% (the Company has not entered into any other acquisition transaction during the period of six months before entering into this transaction). As such, the Company is required to disclose an information memorandum concerning the acquisition of assets to the Stock Exchange of Thailand ( SET ) and submit the information memorandum to its shareholders within 21 days from the date of such disclosure to the SET. In this regard, the Company has prepared and submitted the information memorandum concerning the acquisition of assets to the shareholders together with the notice of the Extraordinary General Meeting of Shareholders No. 1/2017 on the same occasion instead of circulating the information memorandum. Moreover, the above transaction is deemed as a connected transaction of listed company under the Notification of the Capital Market Supervisory Board No. TorChor. 21/2551 Re: Rules on Connected Transactions and the Notification of the SET Board of Governors Re: Disclosure of Information and Other Acts of Listed Companies Concerning Connected Transactions B.E (the Notifications on Connected Transaction ). The transaction size is equal to 26.27% of net tangible assets of the Company and its subsidiaries as at June 30, After aggregating with size of the transactions regarding (1) interest payable by the Company to the Seller Group in the event that it pays the remaining consideration to the Seller Group after the end of the 6-month period from the Sale and Purchase Agreement Date, the transaction size of which is equal to 0.28%; (2) interest on loans payable by AMA to Ratchada Business District Co., Ltd. ( RBD ), of which Miss Satita is a major shareholder, after the Company has acquired AMA Group, the transaction size of which is equal to 0.07%; and (3) the connected transaction taking place during the period of 6 months before the acquisition of AMA shares, i.e. the services transaction between AMA and the Company s subsidiaries, the transaction size of which is equal to 0.10%, the total value of the connected transactions will become 26.72%, which exceeds 3% of the net tangible assets of the Company and its subsidiaries. Therefore, the Company is required to disclose an information memorandum on the transaction to the SET and seek an approval for the connected transaction from the shareholders meeting with required affirmative votes of at least three-fourths of the total votes of the shareholders who attend the meeting and have the right to vote, excluding shareholders with conflict of interest. The above transaction is considered a purchase or acceptance of a transfer of business of a private entity to the Company pursuant to Section 107(2)(b) of the Public Limited Companies Act B.E (and its amendments). Therefore, the Company must obtain an approval from the shareholders meeting with required affirmative votes of at least three-fourths of the total votes of the shareholders who attend the meeting and have the right to vote, excluding shareholders with conflict of interest. The Company has appointed Capital Advantage Co., Ltd. as the independent financial advisor ( IFA or CapAd ) to provide opinion to the shareholders regarding reasonableness and fairness of price and conditions for the acquisition of assets and the connected transaction. In rendering opinion on such transaction, CapAd has studied details of the Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction of the Company, the information obtained from interviews with the executives and management of the Company and AMA Group, the documents obtained from the Company and AMA Group such as financial statements, assumptions for financial projection preparation, business plans, property appraisal reports, pro-forma consolidated financial statements, including publicly available information such as annual registration statement (Form 56-1), information posted on websites of the SET and the Office of the Securities and Exchange Commission ( SEC ), financial information derived from various websites, etc. CapAd is unable to certify or guarantee the accuracy or completeness of the Capital Advantage Company Limited Page 3/89

4 information obtained from the Company and AMA Group and/or the executives and/or the management of the Company and AMA Group. The opinion rendered herein is based on the assumption that all such information and documents are true, correct and complete, and is, moreover, based on the circumstances and information prevailing at the time of preparation of this report. As such, if there is any change or incident occurring, it may have material impact on business operation and financial projection of AMA Group, as well as on the shareholders decision regarding the said connected transaction. In rendering opinion to the shareholders, CapAd has determined the reasonableness of the acquisition of assets and the connected transaction, price and conditions together with all relevant factors with due care and reasonableness in accordance with professional standards. The documents appended to this opinion report of the IFA are deemed as an integral part of this report and are recommended to be considered by the shareholders in conjunction with this report. CapAd has considered and studied information on the acquisition of assets and the connected transaction, details and results of which can be described as follows: Capital Advantage Company Limited Page 4/89

5 Abbreviation The Company or PRINC Principal Capital PCL. AMA Alliance Medical Asia Co., Ltd. PSV Pitsanuloke Medical Co., Ltd. (a direct subsidiary of AMA in which AMA holds a stake of 60%) PNP Paknampo Hospital Co., Ltd. (a direct subsidiary of AMA in which AMA holds a stake of 90.92%) PNP1 Paknampo Hospital (under Paknampo Hospital Co., Ltd.) PNP2 Paknampo 2 Hospital (under Paknampo Hospital Co., Ltd.) SHV Union Pichit Doctors Co., Ltd. (an indirect subsidiary of AMA through shareholding of 99.99% by PSV) PUH Pitsanuvej Uttaradit Hospital Co., Ltd. (an indirect subsidiary of AMA through shareholding of 99.99% by PSV) PPC Pitsanuvej Pattana Co., Ltd. (an indirect subsidiary of AMA through shareholding of 99.99% by PSV) PNPH P.N.P Hospital Co., Ltd. (an indirect subsidiary of AMA through shareholding of 99.99% by PNP) AMA Group AMA, PSV, PNP, SHV, PUH, PPC, and PNPH Seller Group Miss Satita Viddayakorn, Vantage Point Management Ltd., and Mr. Sirichai Towiriyawate Miss Satita Miss Satita Viddayakorn Vantage Point Vantage Point Management Ltd. Mr. Sirichai Mr. Sirichai Towiriyawate Share Sale and Purchase Date The date on which the Company purchases and accepts a transfer of the ownership of shares in Alliance Medical Asia Co., Ltd. from the Seller Group VB Group V Brilliant Group Holdings Co., Ltd. (a subsidiary of PRINC) and VB s subsidiaries, namely V Intelligence Co., Ltd., V Residence Co., Ltd., V 33 Co., Ltd. and Bangkok Management Co., Ltd. RBD Ratchada Business District Co., Ltd. (having Miss Satita as the director and major shareholder) EGM The Extraordinary General Meeting of Shareholders No. 1/2017 of Principal Capital PCL. to be held on November 24, 2017 PPA Purchase Price Allocation under the Financial Reporting Standard No. 3 Re: Business Combinations NCI Non-Controlling Interests Independent Property Appraiser Year Appraisal Co., Ltd. Independent Financial Advisor or IFA or Capital Advantage Co., Ltd. CapAd SEC The Office of the Securities and Exchange Commission SET The Stock Exchange of Thailand Notifications on Acquisition or Disposition The Notification of the Capital Market Supervisory Board No. of Assets TorChor. 20/2551 Re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets and the Notification of the Board of Governors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Acquisition or Disposition of Assets B.E and its amendments Notifications on Connected Transaction The Notification of the Capital Market Supervisory Board No. TorChor. 21/2551 Re: Rules on Connected Transactions and the Notification of the SET Board of Governors Re: Disclosure of Information and Other Acts of Listed Companies Concerning Connected Transactions B.E and its amendments NTA Net tangible assets WACC Weighted average cost of capital Capital Advantage Company Limited Page 5/89

6 Executive Summary The Board of Directors Meeting of Principal Capital PCL. (the Company or PRINC ) No. 7/2017 held on September 25, 2017 resolved to propose to the Extraordinary General Meeting of Shareholders No. 1/2017 (the EGM ) to consider and approve an acquisition of the businesses of Alliance Medical Asia Co., Ltd. s group of companies ( AMA Group ) through purchase of 268,374,998 shares representing approximately 99.99% of total issued and paid-up shares of Alliance Medical Asia Co., Ltd. ( AMA ) from AMA s existing shareholders, who are the connected persons, at a price of approximately Baht per share totaling not more than Baht 2,000,000,000, consisting of (1) 146,852,399 ordinary shares from Miss Satita Viddayakorn ( Miss Satita ), (2) 118,750,600 ordinary shares and 1,372,000 preferred shares from Vantage Point Management Ltd. ( Vantage Point ), and (3) 1,399,999 ordinary shares from Mr. Sirichai Towiriyawate ( Mr. Sirichai ). In this respect, half of the total consideration (Baht 1,000 million) will be paid on Share Sale and Purchase Date and the remaining half of the total consideration (Baht 1,000 million) will be paid within 12 months from the Sale and Purchase Agreement Date. Please see more details of the share payment in Part 1 Clause 1.6 of this report. The acquisition of AMA shares is deemed as an acquisition of assets, with the highest transaction size equal to 35.61%, calculated on the net tangible assets criteria according to net tangible assets of the Company and its subsidiaries as of June 30, It is also deemed as a connected transaction since AMA s existing shareholders, or the Seller Group, are the major shareholders or a juristic entity in which the seller is the ultimate beneficial owner or are executives of the Company. The size of the connected transaction is equal to 26.27% of net tangible assets of the Company and its subsidiaries as of June 30, After aggregating with value of the transactions regarding (1) interest payable by the Company to the Seller Group in the event that it pays the remaining consideration to the Seller Group after the end of the 6-month period from the Sale and Purchase Agreement Date, the transaction size of which is equal to 0.28%; (2) interest on loans payable by AMA to Ratchada Business District Co., Ltd. ( RBD ), of which Miss Satita is a director and major shareholder, after the Company has acquired AMA Group, the transaction size of which is equal to 0.07%; and (3) the connected transaction taking place during the period of six months before the acquisition of AMA shares, i.e. the services transaction between AMA and the Company s subsidiaries, the transaction size of which is equal to 0.10%, the total value of the connected transactions will become 26.72%, which exceeds 3% of the net tangible assets of the Company and its subsidiaries. Therefore, the Company is required to disclose an information memorandum on the transaction to the SET and seek an approval for the connected transaction from the shareholders meeting with required affirmative votes of at least three-fourths of the total votes of the shareholders who attend the meeting and have the right to vote, excluding shareholders with conflict of interest. The above transaction is considered a purchase or acceptance of a transfer of business of a private entity to the Company pursuant to Section 107(2)(b) of the Public Limited Companies Act B.E (and its amendments). Therefore, the Company must obtain an approval from the shareholders meeting with required affirmative votes of at least three-fourths of the total votes of the shareholders who attend the meeting and have the right to vote, excluding shareholders with conflict of interest. Capital Advantage Co., Ltd. ( Independent Financial Advisor or IFA or CapAd ), as the independent financial advisor appointed by the Company, has considered the objective and necessity of the transaction and the advantages, disadvantages, benefits and risks involved, and is of the opinion as follows: The expansion of investment in property business in V Brilliant Group Holding Co., Ltd. s group of companies ( VB Group ) in late 2016 has enabled the Company to grow its recurring income assets. Those assets help to boost its revenues to some extent, though; the Company has still incurred a net loss from operation since 2016, primarily due to an increase in administrative expenses and finance costs. Besides, the Company has not yet started development of property for sales projects on the investment properties owned by the Company. As such, the Company views that the business acquisition through purchase of AMA shares will help to immediately increase its income and performance, improve the profit generating capability of its business groups in the future, create additional income sources, diversify risk involved with income source, and lessen its sole reliance on income from the property business. The Company will broaden its business scope to the hospital business which shows a good growth potential in the wake of greater health concerns in Thailand and across the globe, growing demand for healthcare services as Thailand will become an aging society in the future, and the government sector s strategy to develop Thailand into a medical hub. Capital Advantage Company Limited Page 6/89

7 The advantages and benefits from entering into this transaction are as follows: (1) the transaction provides an opportunity for the Company to expand business into the private hospital sector, which exhibits a robust growth rate; (2) Investment risk can be diversified, with an increase in income sources; (3) The Company can immediately recognize income from hospital business and improve its financial position and performance; (4) The acquisition price of AMA shares is lower than the book value and the fair value measured by the IFA; (5) The terms of payment for AMA shares are favorable, helping to relieve the burden of prompt fund raising for total share payment on Share Sale and Purchase Date;(6) PNP1 and PPC have nearby land plots readily available for future business expansion; (7) AMA has already streamlined the business process and administration system, renovated the buildings and rooms, additionally procured modern medical equipment, additionally recruited medical personnel and reception & customer service staffs, and upgraded IT system, thus helping to save time for the Company to undertake the foregoing by itself; and (8) AMA has already revised the accounting system of PNP, PSV and SHV, whereby the financial statements for 2016 of AMA, PSV, PNP and PNPH were already audited by the SEC-approved auditor, who is making a quarterly review for 2017 and will further make a yearly audit for 2017 on all members of AMA Group, thus helping to save time for the Company to undertake the foregoing by itself. However, there are certain disadvantages and risks from the transaction as follows: (1) the Company incurs an increase in debts and interest expenses; (2) the Company incurs risk in procurement of future funds required for investment in the expansion of hospital and property businesses; (3) risk involved with procurement of long-term funding for investment in AMA shares to replace the short-term loans from financial institutions; (4) time required for income generation to cover the cost of investment in renovation of PNP1 and PNP2 in ; (5) intense competition in hospital business; (6) risk associated with hospital business expansion; (7) risk from shortage of medical personnel; (8) risk of facing lawsuits for damage claims arising from medical services; (9) incurrence of extra expenses on employment of an IFA and arrangement of the shareholders meeting required due to the connected transaction; and (10) incurrence of higher audit fees than in case of purchase of other hospitals (asset acquisition) or hospital operation companies in general since AMA Group consists of as many as 6 member companies. From this transaction, shares of the Company may be transferred from Property Development Sector to Health Care Services Sector due to the change in revenue structure. Currently, revenue of the Company derived mainly from property development. However, most of the revenue shall be from hospital business after completion of this transaction. Consideration of industry group and sector reclassification is the sole decision of the SET. In view of the rationale and necessity of the transaction together with the comparison of advantages, benefits, disadvantages and risks from entering into the transaction, the IFA is of the opinion that the acquisition of assets and the connected transaction are reasonable and will benefit the Company and its shareholders in the long term. With regards to the acquisition of AMA, most of current management of hospitals in AMA Group who has knowledge, experience, and expertise in hospital management shall continue to work with the Company. Additionally, directors and executives of the Company (Mr. Pongsak Viddayakorn, M.D. and Mr. Soontorn Sritha, M.D.) already have knowledge, experience, and expertise in hospital management. Thus, the Company views that it is well prepared for management of hospitals obtained from acquisition of AMA. As regards the appropriateness of price, the IFA has evaluated fair value of shares of AMA Group and is of the opinion that the most suitable method for valuing AMA business as at the present time is the Discounted Cash Flow Approach since it could reflect the future performance of AMA. CapAd deems that fair value of AMA shares should be in a range of Baht per share or equal to firm value of Baht 2, , million, which is higher than the total consideration for AMA shares acquired from its existing shareholders by Baht million million or 9.15% 22.95% of the total consideration for AMA shares. In summary, the total consideration for AMA shares acquired from its existing shareholders under this transaction is considered appropriate since it is lower than the fair value of AMA shares appraised by the IFA. Therefore, we recommend that the shareholders should approve the acquisition of assets and the connected transaction. In deciding whether to approve the transaction, shareholders should consider the information, reasons and opinion in various aspects provided herein, including the information in the notice of the shareholders meeting and the enclosures therewith carefully and thoroughly before making a Capital Advantage Company Limited Page 7/89

8 decision. However, the decision whether to approve the proposed transaction depends primarily on the shareholders discretion. CapAd, as the IFA, hereby certifies that we have expressed the above opinion with due care and under professional standards by focusing on shareholders best interest. Details of the IFA s opinion are as follows: Capital Advantage Company Limited Page 8/89

9 Part 1: General Details of the Transaction 1. Characteristics and details of the transaction 1.1 Objective and background of the transaction The Board of Directors Meeting of the Company No. 7/2017 held on September 25, 2017 resolved to propose to the Extraordinary General Meeting of Shareholders No. 1/2017 to consider and approve an acquisition of the businesses of AMA Group through purchase of 268,374,998 shares representing approximately 99.99% of total issued and paid-up shares of AMA from AMA s existing shareholders, who are the connected persons, at a price of approximately Baht per share totaling not more than Baht 2,000,000,000, consisting of (1) 146,852,399 ordinary shares from Miss Satita, (2) 118,750,600 ordinary shares and 1,372,000 preferred shares from Vantage Point, and (3) 1,399,999 ordinary shares from Mr. Sirichai. 1.2 Date of the transaction The Company will purchase AMA shares after it obtains the approval from the Extraordinary General Meeting of Shareholders No. 1/2017 to be held on November 24, 2017 and after all conditions precedent specified in the Sale and Purchase Agreement have been fulfilled or waived by the relevant parties (as per the details in Part 1 Clause 1.10 of this report). At this stage, the Company expects to complete the transaction by December Relevant parties and their relationship Buyer : Principal Capital PCL. Seller Group : Existing shareholders of Alliance Medical Asia Co., Ltd. ( AMA ), consisting of: Type of shares No, of shares sold % (1) Miss Satita Viddayakorn Ordinary shares 146,852, (2) Vantage Point Management Ltd. 1/ Ordinary shares 118,750, Preferred shares 2/ 1,372, (3) Mr. Sirichai Towiriyawate Ordinary shares 1,399, ,374,998 3/ Remark: 1/ Vantage Point is a juristic entity established on British Virgin Islands to operate as a holding company. It is 100% owned by Vivid Vantage Trading Ltd. and has the Viddayakorn Family as its ultimate beneficial owner. 2/ One preferred share is entitled to 4 votes and to receive dividend at 4 times of the dividend paid for one ordinary share. 3/ AMA has a total of 268,375,000 shares, two of which are not sold in this transaction and are held by Miss Satita and Mr. Sirichai. Relationship with the Company : The relationship between the Seller Group, composed of Miss Satita, Vantage Point and Mr. Sirichai, and the Company is as follows: Before entering into the transaction (1) Miss Satita - The Company s major shareholder, holding 1,760,115,114 shares or approximately 54.32% of the Company s paid-up capital as of October 10, 2017, which is the latest closing date of the shareholder register book. (498,054,588 shares are held directly by Miss Satita and 1,262,060,526 shares are held by UBS AG Hong Kong Branch for Miss Satita) - Daughter of Dr. Satit Viddayakorn who is the Company s director, major shareholder and Chairman of Executive Committee and holds 972,199,200 shares or 30.01% of the Company s paid-up capital as of October 10, (2) Vantage Point A juristic entity of which the Viddayakorn Family is the ultimate beneficial owner. (3) Mr. Sirichai The Company s executive, currently in a position of the Risk Management and Investment Director. After the purchase of AMA shares The Company will own 99.99% of AMA s paid-up capital and AMA will therefore become a subsidiary of the Company, thereby leading the Company to be an indirect shareholder of AMA s subsidiary. 1.4 General characteristics of the transaction The Company will purchase a total of 268,374,998 shares with a par value of Baht 10 per share in AMA, representing approximately 99.99% of total issued and paid-up shares of AMA, from AMA s existing shareholders at a price of approximately Baht per share totaling not more than Baht 2,000,000,000, details of which are as follows: (a) Purchase of 146,852,399 ordinary shares, equivalent to approximately 54.72% of total issued and paid-up shares of AMA, from Miss Satita at a total consideration of not more than Baht 1,094,382,115.28; (b) Purchase of 118,750,600 ordinary shares and 1,372,000 preferred shares, totaling 120,122,600 shares or equivalent to approximately 44.76% of total issued and paid-up Capital Advantage Company Limited Page 9/89

10 shares of AMA, from Vantage Point at a total consideration of not more than Baht 895,184,729.54; and (c) Purchase of 1,399,999 ordinary shares, equivalent to approximately 0.52% of total issued and paid-up shares of AMA, from Mr. Sirichai at a total consideration of not more than Baht 10,433, The Company will make payment for those shares to Miss Satita, Vantage Point and Mr. Sirichai in cash, whereby half of the total consideration (Baht 1,000 million) will be paid on Share Sale and Purchase Date and the remaining half of the total consideration (Baht 1,000 million) will be paid within 12 months from the Sale and Purchase Agreement Date. Please see more details of the share payment in Part 1 Clause 1.6 of this report. The said acquisition of AMA shares will lead the Company to have AMA as its direct subsidiary and to also acquire all six subsidiaries of AMA, directly and indirectly, including: (1) Pitsanuloke Medical Co., Ltd. ( PSV ) (60% owned by AMA) operates Pitsanuvej Hospital in Pitsanuloke Province. Pitsanuvej Hospital provides upper secondary care 2, including medical services such as Internal Medicine Clinic, Pediatrics Center, Obstetrics and Gynecology Clinic, Surgical Clinic, Rak-chevit Health Check-up Center, Psychiatric Clinic, Children and Adolescents Development Center, Eye Center, Ear, Nose and Throat Center, Dental Center and other services such as Radiology, Heart, Laboratory and Surgical examination. Offering a total of 150 registered beds, Pitsanuvej Hospital has been providing medical services for 35 years, with Joint Commission International (JCI) 3 accreditation. (2) Union Pichit Doctors Co., Ltd. ( SHV ) (99.99% owned by PSV) operates Sahavej Hospital in Pichit Province. The hospital offers medical services including Orthopedics Center, Emergency Center, Health Check-up Center, Urinary Tract Center, Kidney Center, X-ray Center, Internal Medicine Clinic, Surgical Clinic, Physical Therapy Center, Pediatrics Center and Obstetrics and Gynecology Clinic. Having 90 registered beds, the hospital was opened to service on October 15, (3) Pitsanuvej Uttaradit Hospital Co., Ltd. ( PUH ) (99.99% owned by PSV) was incorporated on June 2, 2017 to operate a private hospital, planning to establish Pitsanuvej Uttaradit Hospital. At present, PSV has already purchased land in Muang District, Uttaradit Province. (4) Pitsanuvej Pattana Co., Ltd. ( PPC ) (99.99% owned by PSV) was incorporated on September 15, 2017 to operate private hospital business. PPC acquired land plots with total area of 809 sq.wah (opposite to Pitsanuvej Hospital) located in Muang Pitsanuloke District, Pitsanuloke Province with approximate cost of Baht 71 million on September 27, 2017 from non-connected persons. Such land will be used as parking area for customers of Pitsanuvej Hospital that tends to increase. It might also be used for business expansion in the future. Current paid-up capital is Baht 1 million. However, at present PPC has no operation yet. (5) Paknampo Hospital Co., Ltd. ( PNP ) (90.92% owned by AMA) (formerly Ten M.D. Nakornsawan Co., Ltd.) operates two hospitals, namely Paknampo Hospital ( PNP1 ) and Paknampo 2 Hospital ( PNP2 ). Both are 100-bed hospitals, located in Muang District, Nakhon Sawan Province. In addition, both hospitals are private hospitals that have been accredited by the Healthcare Accreditation Institute (Public Organization). Both PNP1 and PNP2 provide upper secondary care to cash and private insurance clients. Their medical services consist of Emergency Center, Pediatric Clinic, Dental Clinic, Diagnostic Radiography Center, Gastrointestinal and Liver Clinic, Heart and Cardiovascular Center, Intensive Care Unit, Infectious Disease Clinic, Internal Medicine Clinic, Laboratory, Neuroscience Clinic, Orthopedic Clinic, Physical Therapy Department, Surgery Clinic, Urinary Tract Center, Medical Check-up Center, Genecology and Obstetricians Center and Ear, Nose and Throat Center. (6) P.N.P Hospital Co., Ltd. ( PNPH ) (99.99% owned by PNP) was incorporated on April 9, 2014 to operate healthcare services. It currently has registered capital of Baht 150 million and paid-up capital of Baht 37.5 million. However, PNPH has not yet launched business operation at present. 2 Upper secondary care hospital refers to hospital that provides medical treatment of more complex diseases that requires physicians with minor specialty apart from physicians with major specialty such as ophthalmology, otolaryngology, radiology, psychiatry, rehabilitation medicine, critical care, etc. 3 Joint Commission International, or JCI, provides international healthcare accreditation services in the areas of organization management, leadership, physical safety structure, emergency response system, infection prevention and control system, information and communication system, human resource management system, patient safety and quality system, and development and improvement of patient care quality from the time they enter the hospital until they leave, by paying regard to patients rights, disclosure of details about the disease and symptom, and proper acts to ensure that the treatment is in the patient s best interest. Capital Advantage Company Limited Page 10/89

11 Profile of AMA Group is presented in Attachment 1 of this report and also in the Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction enclosed with the Notice of the Extraordinary General Meeting of Shareholders (Enclosure No. 2). The shareholder structure of the Company and AMA before and after entering into the transaction is as follows: (a) Shareholder structure of AMA Group before entering into the transaction Remark: * Nimpitakpong Group, who hold 40% of PSV via shareholding in Pitakpong Medical Co., Ltd. and Suksangsan Co., Ltd., is not a connected person of the Company. (Please find more details in Attachment 1 of this report) Capital Advantage Company Limited Page 11/89

12 (b) Shareholder structure of the Company before entering into the transaction Remark: * Data as of October 10, 2017, which is the latest closing date of the shareholder register book (XM) (source: Thailand Securities Depository Co., Ltd.) (Miss Satita holds the Company s shares directly and via UBS AG Hong Kong Branch) (1) V Brilliant Group Holding Co., Ltd., (2) V Intelligence Co., Ltd., (3) V Residence Co., Ltd., (4) V 33 Co., Ltd., and (5) Bangkok Management Co., Ltd. (collectively called VB Group ) Capital Advantage Company Limited Page 12/89

13 (c) Shareholder structure of the Company after entering into the transaction Remark: * Data as of October 10, 2017, which is the latest closing date of the shareholder register book (XM) (source: The Thailand Securities Depository Co., Ltd.) (Miss Satita holds the Company s shares directly and via UBS AG Hong Kong Branch) ** Nimpitakpong Group, who hold 40% of PSV via shareholding in Pitakpong Medical Co., Ltd. and Suksangsan Co., Ltd., is not a connected person of the Company. (Please find more details in Attachment 1 of this report) 1.5 Details of the assets being acquired The acquisition of AMA shares will lead the Company to have AMA as its direct subsidiary and to acquire all six subsidiaries of AMA, directly and indirectly, comprising PSV, PNP, SVH, PUH, PPC, and PNPH. Profile of AMA Group is presented in Attachment 1 of this report and also in the Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction enclosed with the Notice of the Extraordinary General Meeting of Shareholders (Enclosure No. 2). 1.6 Total value of consideration, basis for determination of consideration value, and payment terms Total value of consideration and basis for determination of consideration value The total value of consideration payable by the Company for the acquisition of AMA shares is not more than Baht 2,000,000,000, divided into consideration for 267,002,998 ordinary shares and 1,372,000 preferred shares at a price of approximately Baht per share. The Company will make payment for those shares in cash to AMA shareholders. If include interest payable of Baht 21,250,000 that shall be paid to the Seller Group in case that the Company pays the remaining consideration after the end of the 6-month period from the Sale and Purchase Agreement Date, total value of consideration shall equal to Baht 2,021,250,000. The total value of consideration for acquisition of AMA shares is determined by many approaches based on growth prospect and nature of business, including discounted cash flow and comparison of trading multiples and transaction multiples, which are the standard approaches generally used for investment decision. In determining such acquisition price, the Company has taken Capital Advantage Company Limited Page 13/89

14 into account not only AMA s value but also the benefits it will obtain in the future from the expansion of its scope of business through such investment in AMA. Payment and payment terms The Company will pay the consideration in cash to AMA s existing shareholders, namely Miss Satita, Vantage Point and Mr. Sirichai, after the conditions precedent under the Sale and Purchase Agreement on AMA shares have been fulfilled and subject to the terms and conditions set forth in such agreement. In this respect, a portion of the consideration (Baht 1,000 million) will be paid on Share Sale and Purchase Date and the remaining portion (Baht 1,000 million) will be paid within 12 months from the Sale and Purchase Agreement Date, details of which are as follows: Consideration Shareholders Payable on Share Sale and Purchase Date (Baht) Payable within 12 months from the Sale and Purchase Agreement Date (Baht) 1. Miss Satita 547,191, ,191, Vantage Point 447,592, ,592, Mr. Sirichai 5,216, ,216, Total 1,000,000, ,000,000, In the case where the Company pays the remaining consideration to Miss Satita, Vantage Point or Mr. Sirichai after the end of the 6-month period from the Sale and Purchase Agreement Date, the Company have to pay interest on a monthly basis to Miss Satita, Vantage Point and/or Mr. Sirichai on the remaining consideration not yet paid by the Purchaser (the Company) at a rate equal to MLR 2% of Bangkok Bank PCL. as of the date immediately following the final date of the 6-month period from the Sale and Purchase Agreement Date ( Interest Commencement Date ). Interest shall be calculated from the Interest Commencement Date until the date of complete payment of the consideration by the Company (no compounding), or with the maximum amount of interest payable of Baht million. 1.7 Calculation of transaction size The acquisition of 268,374,998 shares in AMA or approximately 99.99% of the total issued and paid-up shares at a total consideration of not more than Baht 2,000,000,000 is deemed as an acquisition of assets under the Notification on Acquisition or Disposition of Assets. The highest transaction size is equal to 35.61% based on the net tangible asset criteria, thus constituting a Type 2 transaction with transaction size higher than 15% but less than 50%. Asset acquisition transaction Criteria for calculation Formula Transaction size 1. Net tangible assets (NTA) criteria [2, / / 7, / ] x 99.99% 35.61% 2. Net profit criteria Not applicable because PRINC incurred a net loss over the previous four quarters (June June 2017) 3. Total value of consideration criteria [2, / 8,848.81] 3/ 22.84% 4. Value of issued securities criteria Not applicable because PRINC does not issue any securities to pay for AMA shares Remark: 1/ NTA of AMA according to the pro-forma consolidated financial statements of AMA and its subsidiaries as at June 30, 2017, prepared by the Company in consultation with its auditor. 2/ NTA of the Company according to the consolidated financial statements of Company and its subsidiaries ended June 30, 2017, reviewed by the auditor. 3/ Total consideration payable to AMA s existing shareholders = AMA s share value (Baht 2,000 million) + interest payable that shall be paid to the Seller Group in case that the Company pays the remaining consideration after the end of the 6- month period from the Sale and Purchase Agreement Date (Baht million), resulting in total consideration of Baht 2, million / total assets of the Company and its subsidiaries as at June 30, Connected Transaction Moreover, the acquisition of AMA shares is deemed as a connected transaction under the Notifications on Connected Transaction because Miss Satita, Vantage Point and Mr. Sirichai are considered as connected persons of the Company. Miss d is the Company s major shareholder and is daughter of Dr. Satit Viddayakorn who is the Company s major shareholder, director and Chairman of Executive Committee; Vantage Point is a juristic entity of which Viddayakorn Family is the ultimate beneficial owner; and Mr. Sirichai is the Company s executive. The size of connected transaction is equal to 26.27%. After aggregating with value of the transactions regarding interest payable by the Company to Miss Satita, Vantage Point and Mr. Sirichai in the event that it pays the remaining consideration to the Seller Group after the end of the 6-month period from the Sale and Purchase Agreement Date, the transaction size of which is equal to 0.28%, the total value of the connected Capital Advantage Company Limited Page 14/89

15 transactions will then become 26.55% of the net tangible assets of the Company and its subsidiaries as at June 30, Total consideration payable by PRINC to Miss Satita, Vantage Point and Mr. Sirichai, who are the Unit: Baht million connected persons 1. Cash payment for AMA shares 2, Interest expenses in case PRINC pays the remaining consideration to the Seller Group after the end of 6 months from the Sale and Purchase Agreement Date Total 2, NTA of the Company and its subsidiaries as at June 30, , Size of the connected transaction 26.55% In addition, after combining with the transaction of loan interest payable by AMA to Ratchada Business District Co., Ltd. ( RBD ), which has Miss Satita as its director and major shareholder, following the acquisition of AMA Group by the Company, the transaction size of which is equal to 0.07%, and the connected transaction taking place during the period of six months before the acquisition of AMA shares, i.e. the services transaction between AMA and the Company s subsidiaries, the transaction size of which is equal to 0.10%, total size of the connected transactions will become 26.72%, which exceeds 3% of the net tangible assets of the Company. Therefore, the Company is required to disclose an information memorandum on the transaction and seek an approval from the shareholders meeting with required affirmative votes of at least threefourths of the total votes of the shareholders who attend the meeting and have the right to vote, excluding shareholders with conflict of interest. At the Extraordinary General Meeting of Shareholders No. 1/2017 to be held on November 24, 2017, shareholders who have conflict of interest and are not entitled to cast vote on such transaction (as of October 10, 2017 or the latest closing date of the Company s share registration book for the Extraordinary General Meeting of Shareholders No. 1/2017) are: (1) Miss Satita, holding 1,760,115,114 shares or 54.32% of the Company s total voting rights (498,054,588 shares are held directly by Miss Satita and 1,262,060,526 shares are held by UBS AG Hong Kong Branch for Miss Satita); (2) Dr. Satit Viddayakorn, holding 972,199,200 shares or 30.01% of the Company s total voting rights; (3) Peak Development Holdings Ltd., holding 157,737,029 shares or 4.87% of the Company s total voting rights; and (4) Miss Pallapa Viddayakorn, holding 55,291,200 shares or 1.71% of the Company s total voting rights. Besides, the acquisition of AMA shares is also considered a purchase or acceptance of a transfer of business of a private entity to the Company pursuant to Section 107(2)(b) of the Public Limited Companies Act B.E (and its amendments). Therefore, the Company must obtain an approval from the shareholders meeting with required affirmative votes of at least three-fourths of the total votes of the shareholders who attend the meeting and have the right to vote, excluding shareholders with conflict of interest. 1.8 Sources of funds for entering into the transaction The Company will use its cash flow available from business operation and/or financing sources from financial institutions to fund the acquisition of AMA shares. As shown on its consolidated financial statements as of June 30, 2017, the Company has total cash and cash equivalents and short-term investments of Baht 1, million. Compared with the total consideration for AMA shares of not more than Baht 2,000 million, the Company is under the negotiation for additional funds from financial institutions. At this stage, it has already received an offer for short-term loans, less than 1-year term (no collateral), of Baht 1,000 million from a financial institution, the amount of which is adequate not only for the acquisition of AMA shares, but also for the interest payment in the case where it pays the remaining consideration to the Seller Group after the end of the 6-month period from the Sale and Purchase Agreement Date with the maximum amount of interest payable of Baht million and for AMA s payment of the principal of Baht million and interest of about Baht 5.41 million (calculated for a period of six months from the end of August 2017 plus accrued interest) to RBD. Capital Advantage Company Limited Page 15/89

16 1.9 Summary of the Sale and Purchase Agreement on Shares of Alliance Medical Asia Co., Ltd. A summary of such agreement is presented in Attachment 2 of this report and the Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction, enclosed with the Notice of the Extraordinary General Meeting of Shareholders No. 1/2017 (Enclosure No. 2) Conditions for the transaction The acquisition of AMA shares with cash payment is contingent upon fulfillment of the following conditions precedent set forth in the Sale and Purchase Agreement: 1) The Company must obtain an approval from the shareholders meeting for the acquisition of businesses of AMA Group through a purchase of AMA shares from the existing shareholders. The Extraordinary General Meeting of Shareholders No. 1/2017 to be held on November 24, 2017 will consider and approve the said transaction. 2) The board of directors meeting of AMA shall approve the sale of AMA shares to the Company. 3) The meetings of the board of directors and shareholders of AMA shall approve the change of number of directors, appointment of new directors and change of the authorized directors of AMA as agreed amongst the parties. Furthermore, there is a material condition set forth in the Sale and Purchase Agreement that, throughout the period in which Miss Satita remains the major shareholder of the Company, Miss Satita shall not carry on any business or perform any act (including investment in more than 10% of total capital of any business) in such a manner that is deemed to compete with the Company or its subsidiaries or creates other benefit that could conflict with the best interest of the Company or its subsidiaries, whether directly or indirectly. 2. Profile of Principal Capital PCL. The Company s profile is presented in the Information Memorandum Concerning the Acquisition of Assets and the Connected Transaction, enclosed with the Notice of the Extraordinary General Meeting of Shareholders (Enclosure No. 2). 3. Other significant information Loans from RBD As of August 31, 2017, AMA had a loan borrowed from RBD (of which Miss Satita is director and major shareholder) in the amount of Baht million. After the completion of this transaction, such loan will become a connected transaction. However, under the Sale and Purchase Agreement on AMA Shares, the Company agrees to arrange for AMA to settle such loan and all interest to RBD within a period of 6 months from the Sale and Purchase Agreement Date insofar as it is not contrary to the terms and conditions agreed by AMA with other creditors, including financial lenders, except where the creditors or the related financial lenders have given their consent thereto. Capital Advantage Company Limited Page 16/89

17 Part 2: Opinion of the Independent Financial Advisor on Reasonableness of the Acquisition of Assets and the Connected Transaction 1. Objective and necessity of the transaction The expansion of investment in property business of V Brilliant Group Holding Co., Ltd. s group of companies ( VB Group ) in late 2016 has enabled the Company to grow its recurring income assets. Presently, the Company earns recurring income from the residential service business, which includes Marriott Executive Apartment Sathorn Vista-Bangkok hotel project and Somerset Ekamai Bangkok hotel and serviced apartment project; and from the office building management business by managing Bangkok Business Center (BBC). Those assets help to boost its revenues to some extent, though; the Company has still incurred a net loss from operation since 2016, primarily due to an increase in administrative expenses and finance costs. Besides, the Company has not yet started development of property for sales projects on the investment properties owned by the Company, which include land and buildings on Soi Sukhumvit 29 and five plots of vacant land in Chiang Mai, Ang Thong, Saraburi, Udon Thani and Rayong Provinces. Revenue structure and net profit (loss) of the Company and its subsidiaries in and the first six months of 2016 and 2017 Jan - Jan - June June Unit: Baht million Amount Amount Amount Amount Amount 2014/ 2015 Change (%) 2015/ M2016/ 6M2017 Revenues from sales and services Residential service business % 6.9% 48.0% Property management business % 30.0% 157.9% Information technology business % -59.4% -10.7% Property for rent business Total revenues from sales and % -16.5% 54.4% services Other revenues % 0.7% 2,263.2% Total revenues % -16.2% 119.6% Net profit (loss) for the period (51.3) (13.4) (204.2) 35.0% % % Source: Form 56-1 and the Company Remark: - For 2016, the operating results of VB Group were incorporated into the Company s consolidated financial statements for the period from October 10, 2016 to December 31, In the 6M/2017 period, other revenues increased dramatically, attributed to a profit earned from sale of investment property of Baht million of Bangkok Management Co., Ltd. (a subsidiary of PRINC) and as for selling and administrative expenses, there was tax paid by the Company on the said sale of investment property of Baht million. Therefore, the Company views that the business acquisition through purchase of AMA shares will help to immediately increase its income and performance, improve the profit generating capability, growth prospect and income earning capability of its business groups in the future, diversify its risk involved with income sources, and lessen its sole reliance on income source from the property business. The Company will broaden its business scope to the hospital business which shows a good growth potential in the wake of greater health concerns, growing demand for healthcare services as Thailand will become an aging society in the future, the government sector s strategy to develop Thailand into a medical hub in a 10-year period of , and growth in medical tourism industry which leads to an anticipated ongoing expansion of the hospital business. From the investment under this transaction, the Company will acquire a group of four leading hospitals located in various provinces in the lower northern region, comprising (1) Pitsanuvej Hospital (Pitsanuloke Province), (2) Paknampo Hospital ( PNP1 ) (Nakhon Sawan Province), (3) Paknampo 2 Hospital ( PNP2 ) (Nakhon Sawan Province), and (4) Sahavej Hospital (Pichit Province). All of the four hospitals are strategically situated in the heart of the city and have teams of skillful and quality physicians and nurses offering professional medical services, with good developable prospects. Moreover, such business acquisition will help avert risk and save time for the Company given that it has to develop new hospital projects by itself. Thus, entering into this transaction will provide an opportunity for the Company to generate returns and boost its growth in the future and will benefits its shareholders in the long term. Capital Advantage Company Limited Page 17/89

18 2. Impacts from the acquisition of AMA shares on the Company s financial position and performance After the acquisition of AMA shares, the Company will hold 99.99% of shares in AMA and AMA and its direct and indirect subsidiaries will become the Company s subsidiaries. Moreover, the Company will consolidate AMA s financial position and operating results, thereby leading to a significant improvement of the overall financial status and performance of its group. The Company s management has prepared the pro-forma consolidated financial statements, based on the Company s audited consolidated financial statements for the year ended December 31, 2016 and reviewed consolidated financial statements for the 6-month period ended June 30, 2017 and AMA s pro-forma consolidated financial statements for the year ended December 31, 2016 and the 6-month period ended June 30, 2017 prepared by the Company s management in consultation with its auditor, assuming that the acquisition of AMA shares took place on January 1, The major assumptions used are as follows: 1) The pro-forma consolidated financial statements of AMA (AMA + subsidiaries) are prepared in accordance with the Financial Reporting Standard No. 3 (Revised 2016) Re: Business Combinations, by adjusting the estimated surplus of cost over net asset value received which is calculated from the difference between cost of investment in AMA s subsidiaries and their net asset value. 4 2) AMA s pro-forma consolidated financial statements for the year ended December 31, 2016 are based on the audited financial statements (separate financial statements) of AMA, PSV, SHV, PNP and PNPH (excluding PUH and PPC because they have just been established on June 2, 2017 and September 15, 2017, respectively). 3) AMA s pro-forma consolidated financial statements for the year ended December 31, 2016 are prepared as if AMA had acquired a 60% stake in PSV and an 85.97% stake in PNP as from January 1, ) The pro-forma consolidated financial statements for the six-month period ended June 30, 2017 are based on the management account of AMA (separate financial statements), PSV, SHV, PUH, PNP and PNPH, with upward adjustment of AMA s shareholding in PNP from 85.97% to 90.92% after its subscription of 1,631,583 newly issued shares in PNP in June 2017 and purchase of 66,218 shares in PNP from Miss Satita in August 2017 by assuming that such share subscription took place on June 30, (excluding PPC because it has just been established on September 15, 2017) On August 25, 2017, SHV sold its 22,400 shares in Pichit Dialysis Co., Ltd. amounting to Baht 2,500,000, the transaction of which is not included in the pro-forma consolidated financial statements for the 6-month period ended June 30, 2017 since it is an event after financial report as of June 30, 2017 and is insignificant transaction to pro-forma financial statement. 5) In the business combination between the Company and AMA, the pro-forma consolidated financial statements (PRINC consolidated + AMA consolidated) are prepared in accordance with the accounting method for business combination under common control since AMA and the Company are under the ultimate control of the Viddayakorn Family both before and after the business combination. The Company recognizes the assets and liabilities of AMA at book value as of January 1, The difference between the cost of business combination under common control and the interest of the Company at book value of AMA is presented as an item under shareholders equity, with deletion of the related party transactions between AMA and its subsidiaries such as loans and the transactions between the Company s subsidiaries and AMA s subsidiaries such as revenues from services, etc. 6) It is assumed that the total acquisition price for AMA shares is Baht 2,000 million and the difference between book value of AMA in 2016 and as of June 30, 2017 of Baht million is recognized and accounted for as paid-in surplus on business combination under common control. 7) Investment payable in AMA of Baht 2,000 million is recorded. 4 The estimated surplus of cost over net asset value received shown on the pro-forma consolidated financial statements of AMA is calculated from the difference between cost of investment in AMA s subsidiaries (price at which AMA acquired the subsidiaries) and the net asset value (book value) of AMA s subsidiaries as of the transaction date. This is because AMA did not make a purchase price allocation ( PPA ) under the Financial Reporting Standard No. 3 as at the date of acquisition of the subsidiaries. However, the Company is presently carrying out the PPA. As such, after completion of the acquisition of AMA and preparation of the PPA, the Company will have to record a fair value of assets and liabilities of AMA s subsidiaries and goodwill from the acquisition of AMA s subsidiaries in replacement of the estimated surplus of cost over net asset value received as shown on the pro-forma consolidated financial statements of AMA. The record of transactions actually taking place in the future could differ from those presented in the next three pages, depending on the judgment of the Company and its auditor as of the date of actual record of such transactions. Capital Advantage Company Limited Page 18/89

19 Summary of the pro-forma consolidated financial statements for the year ended December 31, 2016 Pre-transaction Consolidated financial statements for Post-transaction Statements of financial position the year ended December 31, 2016 (Unit: Baht million) PRINC and subsidiaries AMA and subsidiaries 1/ PRINC and subsidiaries 2/ Assets Current assets Cash and cash equivalents Short-term investments Restricted deposits with financial institutions Trade and other receivables - net * Inventories Work in process under service contracts Deposits for land Other current assets Total current assets Non-current assets Other long-term investments Restricted deposits with financial institutions Investment property - net 5, , Property, plant and equipment - net 3, , , Intangible assets - net Leasehold rights Goodwill Estimated surplus of cost over net asset value received - 2, , Deferred tax assets Other non-current assets Total non-current assets 9, , , Total assets 9, , , Liabilities and equity Current liabilities Trade and other payables Advances received from customers Current portion of long-term loans from financial institutions Current portion of finance lease liabilities Short-term loan from a related party or company Investment payable - - 2, Income tax payable Deposits received from customers Other current liabilities Total current liabilities , Non-current liabilities Long-term loans from financial institutions , Finance lease liabilities Advances received from customers Deposits received from customers Long-term promissory notes from a related party Deferred tax liabilities Employee benefit obligations Other non-current liabilities Total non-current liabilities 1, , Total liabilities 1, , , Shareholders equity Share capital Authorized share capital 3,240,638,433 ordinary shares at a par value of Baht 1 each 3, , ,372,000 preferred shares at a par value of Baht 10 each ,003,000 ordinary shares at a par value of Baht 10 each - 2, , Issued and paid-up share capital 3,240,087,520 ordinary shares at a par value of Baht 1 each 3, , ,372,000 preferred shares at a par value of Baht 10 each ,003,000 ordinary shares at a par value of Baht 10 each - 2, Premium on paid-up share capital 4, , Retained earnings Appropriated - legal reserve Unappropriated Paid-in surplus on business combination under common control Non-controlling interests Retained earnings - non-controlling interests Capital Advantage Company Limited Page 19/89

20 Pre-transaction Consolidated financial statements for Post-transaction Statements of financial position the year ended December 31, 2016 (Unit: Baht million) PRINC and AMA and PRINC and subsidiaries subsidiaries 1/ subsidiaries 2/ Total equity 7, , , Total liabilities and equity 9, , , Remark: * Trade and other receivables net of AMA and its subsidiaries were receivables of subsidiaries who operate hospital business. Such receivables were from service to health insurance patients and annual health check-up of private entities employees awaiting for payment from health insurance companies and private entities. Summary of the pro-forma consolidated financial statements for the 6-month period ended June 30, 2017 Pre-transaction Consolidated financial statements for Statements of financial position the 6-month period ended Jun 30, 2017 (Unit: Baht million) PRINC and subsidiaries AMA and subsidiaries 1/ Pre-transaction Posttransaction Consolidated financial statements for Statements of income the year ended December 31, 2016 (Unit: Baht million) PRINC and AMA and PRINC and subsidiaries subsidiaries 1/ subsidiaries 2/ Revenues from services , , Costs of services (222.26) (1,163.06) (1,373.67) Gross profit Other income Selling and service expenses (14.14) (15.91) (30.05) Administrative expenses (172.45) (421.93) (594.39) Other expenses - (3.55) (3.55) Finance costs (6.45) (23.07) (29.52) Profit (Loss) before income tax expense (52.04) Income tax revenue (expense) 0.74 (33.35) (32.61) Profit (Loss) for the year (51.30) Posttransaction PRINC and subsidiaries 2/ Assets Current assets Cash and cash equivalents Short-term investments 1, , Restricted deposits with financial institutions Trade and other receivables - net Inventories Work in process under service contracts Other current assets Total current assets 2, , Non-current assets Other long-term investments Property, plant and equipment - net 3, , , Intangible assets - net Leasehold rights Goodwill Estimated surplus of cost over net asset value received - 2, , Deferred tax assets Other non-current assets Total non-current assets 6, , , Total assets 8, , , Liabilities and equity Current liabilities Overdrafts from financial institutions Trade and other payables Advances received from customers Current portion of long-term loans from financial institutions Current portion of finance lease liabilities Short-term loan from a related party or company Investment payable - - 2, Income tax payable Deposits received from customers Other current liabilities Total current liabilities , Non-current liabilities Capital Advantage Company Limited Page 20/89

21 Pre-transaction Posttransaction Consolidated financial statements for Statements of financial position the 6-month period ended Jun 30, 2017 (Unit: Baht million) PRINC and AMA and PRINC and subsidiaries subsidiaries 1/ subsidiaries 2/ Long-term loans from financial institutions , Finance lease liabilities Advances received from customers Deposits received from customers Long-term promissory notes from a related party Deferred tax liabilities Employee benefit obligations Other non-current liabilities Total non-current liabilities , Total liabilities 1, , , Equity Share capital Authorized share capital 3,240,638,433 ordinary shares at a par value of Baht 1 each 3, , ,372,000 preferred shares at a par value of Baht 10 each ,003,000 ordinary shares at a par value of Baht 10 each - 2, , Issued and paid-up share capital 3,240,087,520 ordinary shares at a par value of Baht 1 each 3, , ,372,000 preferred shares at a par value of Baht 10 each ,003,000 ordinary shares at a par value of Baht 10 each - 2, Premium on paid-up share capital 4, , Retained earnings Appropriated - legal reserve Unappropriated (129.72) (82.63) Paid-in surplus on business combination under common control Changes in interests of the parent in subsidiaries Non-controlling interests Retained earnings non-controlling interests Total equity 7, , , Total liabilities and equity 8, , , Pre-transaction Posttransaction Statements of income Consolidated financial statements for (Unit: Baht million) the 6-month period ended Jun 30, 2017 PRINC and AMA and PRINC and subsidiaries subsidiaries 1/ subsidiaries 2/ Revenues from services , Costs of services (191.80) (578.35) (765.94) Gross profit Other revenues Selling and service expenses (9.97) (9.34) (19.31) Administrative expenses (202.49) (218.84) (421.32) Other expenses - (1.87) (1.87) Finance costs (16.84) (9.31) (26.16) Profit (Loss) before income tax (65.58) 6.57 (61.66) Income tax revenues (expenses) (138.58) (9.57) (148.16) Profit (Loss) for the period (204.16) (3.00) (209.82) Remark: 1/ The pro-forma consolidated financial statements of AMA for the year ended December 31, 2016 and the 6-month period ended June 30, 2017 have not yet been audited or reviewed by the certified public accountant and were prepared by the Company s management in consultation with its auditor. However, the record of transactions actually taking place in the future could differ from those presented above, depending on the judgment of the Company and its auditor as of the date of actual record of such transactions. 2/ The pro-forma consolidated financial statements after the acquisition of AMA shares by the Company for the year ended December 31, 2016 and the 6-month period ended June 30, 2017 have not yet been audited or reviewed by the certified public accountant and were prepared by the Company in consultation with its auditor. However, the record of transactions actually taking place in the future could differ from those presented above, depending on the judgment of the Company and its auditor as of the date of actual record of such transactions. Impacts on the Company s performance and financial position According to the pro-forma consolidated financial statements for the year ended December 31, 2016 and the 6-month period ended June 30, 2017, the acquisition of AMA shares results in an increase in the Company s total revenues, total expenses and net profit (loss) and a change in its revenue structure, with its major income source shifting from the property business to the services Capital Advantage Company Limited Page 21/89

22 business of AMA Group that engage in hospital business. As such, the SET or the Company may have to review the industry group and sector of the Company s shares in the future. As for the consolidated financial position after the acquisition of AMA shares, the Company s total assets grow by Baht 4, million to Baht 13, million as at December 31, 2016 and by Baht 4, million to Baht 13, million as at June 30, Such asset growth results mainly from the estimated surplus of cost over net asset value received of Baht 2, million 5 due to the fact that AMA acquired shares in the subsidiaries (PSV and PNP) and PSV acquired SHV at a price higher than book value of each entity as of the transaction date, and also results from an increase in property, plant and equipment-net of Baht 1, million as of December 31, 2016 and Baht 2, million as of June 30, 2017, most of which are the assets used for the hospital business operation. Total liabilities increase by Baht 3, million as at December 31, 2016 and by Baht 3, million as at June 30, 2017, resulting from the record of investment payable arising from entering into this transaction of Baht 2,000 million (recorded as accrued payment for AMA shares), an increase in loans from financial institutions of Baht million as at December 31, 2016 and Baht million as at June 30, 2017, and an increase in short-term loan from a related company of Baht million as at December 31, 2016 and Baht million as at June 30, 2017, which is loan between AMA and RBD which is a connected person. The Company s equity grows by Baht 1, million as at December 31, 2016 and by Baht 1, million as at June 30, Such equity growth results mainly from an increase in paid-in surplus from business combination under common control of Baht million as at June 30, 2017, which is the difference between the consideration for AMA shares and the book value of assets, and an increase in non-controlling interests ( NCI ) of Baht million as at December 31, 2016 and Baht million as at June 30, 2017, arising from NCI that AMA not holding 40% of shares in PSV. The debt to equity ratio as at December 31, 2016 edges up from 0.22 to 0.56 times after the acquisition of AMA shares and, as at June 30, 2017, from 0.16 to 0.57 times after the acquisition of AMA shares. 3. Advantages and disadvantages of the transaction 3.1 Advantages and benefits of the transaction (1) Provision of an opportunity for the Company to expand business into the private hospital sector, which exhibits a robust growth rate The acquisition of AMA shares will enable the Company to broaden its business scope to the hospital business which shows a good growth potential in the wake of greater health concerns, soaring demand for healthcare services due to rising elderly population, the government sector s plan to develop Thailand into a medical hub, and growth in medical tourism in Thailand which leads to an increasing number of international patients and wellness tourism in the country. Hence, the hospital business will become a new income source and help strengthen business growth of the Company in the future. The private hospital industry in Thailand is expanding continuously, bolstered by factors such as greater health concerns which lead to growing demand for medical services, urban expansion, and ongoing growth in international patients encouraged by a greater number of world-class medical facilities that Thailand has to offer than its nearby countries in this region, yet with more affordable medical care when compared with its competitors. Moreover, the progress of ASEAN Economic Community (AEC) helps increase marketing opportunities for Thai hospitals among patients with high purchasing power from neighboring countries. Another contributing factor is the government sector s plan to develop Thailand into a medical hub. Besides, Thai private hospitals have been widely accepted for quality services that are cheaper than other countries, with as many as 50 hospitals obtaining Joint Commission International (JCI) accreditation, outstripping all other countries in this region. Growth in the middle class who has strong purchasing power also leads to ever-increasing demand for medical services. After all, due to the limited capacity of state-run healthcare facilities and hospitals and their crowded OPDs with long queues, there is still room for private hospitals to fulfill the demand unmet by those public hospitals. The hospitals in AMA Group do not participate in the social security scheme, but cater to selfpay patients or those with private health insurance. The Mobile Cabinet Meeting No. 2/2017, held on September 19, 2017 in Phra Nakhon Sri Ayutthaya Province, endorsed the draft Ministerial Regulation issued under the Revenue Code Governing Exemption from Income Tax for Health 5 Please see Footnote 4. Capital Advantage Company Limited Page 22/89

23 Insurance Promotion, whereby taxpayers shall be entitled to income tax exemption of up to Baht 15,000 per year on the part of premium paid under a health insurance policy to life or non-life insurance companies operating business in Thailand, with personal income tax deduction, included with the life insurance premium paid, granted for up to Baht 100,000 per person, effective from January 1, 2017 onwards. Therefore, life and non-life insurance companies and hospitals will reap greater benefits from such tax incentives. (2) Diversification of investment risk and an increase in income sources Presently, the Company earns recurring income from the property rental and services of Marriott Executive Apartment Sathorn Vista-Bangkok hotel project and Somerset Ekamai Bangkok hotel and serviced apartment project and from the office building for rent of BBC. The acquisition of AMA shares will help to immediately boost its income and performance, improve the profit generating ability of its business groups in the future, create additional income sources, and diversify investment risk incidental to a slowdown in the property business, in which case the Company could alternatively generate income from the hospital business. As one of the basic necessities of life, the hospital business is somewhat unaffected by external factors such as domestic and global economic situations when compared with other types of businesses that focus more on responding to consumption demand since the hospital business essentially fulfills the needs for healthcare services which exhibit an ever-increasing demand. In addition, the Company will benefit from risk diversification through a more diverse type of business, thereby mitigating risk from its sole reliance on income source from the property business. (3) Immediate recognition of income from hospital business and stronger financial position and performance After the completion of this transaction, AMA will become a subsidiary of the Company and the Company will consolidate the financial position and operating results of AMA into the group s, thus immediately increase its income and performance and improving the group s profit generating ability in the future, as described in Part 2 Clause 2 Impacts on the Company s performance and financial position. However, according to the pro-forma consolidated financial statements for the 6M/2017 period, AMA incurs a net loss of Baht 3 million, caused mainly by a drop in revenues from hospital operations of Paknampo Hospital and Sahavej Hospital due to a temporary shutdown of some sections for renovation such as IPD rooms, ICU department, etc. and an increase in depreciation cost due to investment in renovation and new medical equipment procurement. (4) The acquisition price of AMA shares is lower than the book value and the fair value measured by the IFA The Company will acquire AMA shares at a total value of Baht 2,000 million, which is lower than the book value of AMA. As shown on its consolidated financial statements as of June 30, 2017, AMA had total equity of Baht 3, million and equity attributable to the parent company of Baht 2, million. The said acquisition price is also lower than the fair value appraised by the IFA at Baht 2, million 2, million. (Please see more details in Part 3 of this report.) (5) Favorable terms of payment for AMA shares, helping to relieve the burden of prompt fund raising for total share payment on Share Sale and Purchase Date The total consideration for AMA shares of Baht 2,000 million will be paid in two tranches: the first tranche of Baht 1,000 million payable on Share Sale and Purchase Date and the second tranche of Baht 1,000 million payable within 12 months from the Sale and Purchase Agreement Date. As such, the Company will not have to promptly raise total funds for full share payment on Share Sale and Purchase Date. - During the first 6 months from the Sale and Purchase Agreement Date, there is no interest payable to the Seller Group, thus reducing finance costs which may otherwise affect the Company s performance. - In the case that the Company pays the remaining consideration to Miss Satita, Vantage Point or Mr. Sirichai after the end of 6-month period from the Sale and Purchase Agreement Date, the Company has to pay interest on a monthly basis to Miss Satita, Vantage Point and/or Mr. Sirichai on the remaining consideration not yet paid by the Purchaser (the Company) at a rate equal to MLR 2% of Bangkok Bank PCL. as of the date immediately following the final date of the 6-month period from the Sale and Purchase Agreement Date ( Interest Commencement Date ). Interest shall be calculated from the Interest Commencement Date until the date of complete payment of Capital Advantage Company Limited Page 23/89

24 the consideration by the Company (no compounding), or with the maximum amount of interest payable of Baht million. (6) PNP1 and PPC have nearby land plots readily available for future business expansion Hospitals that are situated in the heart of a city have a competitive edge from their location in community areas. However, to acquire additional land next to their existing location (on which to construct new buildings for business expansion) may be difficult or costly, whereas to acquire land that is far away from the current project site will cause inconvenience in terms of both business operation and customer facilitation. PNP1 and PPC have purchased three plots of land adjacent to its existing hospital for the expansion of its healthcare facilities. Currently, PNP1 s two plots of the land are being used as parking lots and another plot has just been acquired on September 8, PPC has purchased 6 land plots opposite of Pitsanuvej Hospital on September 27, 2017 for future expansion of PSV. As such, if PNP1 and PPC wish to expand the business in the future, it will not have to acquire additional land for construction of new hospital buildings and use as car park (parking lots are very essential for customers). PNP1 and PPC will be able to develop a new project promptly when it is ready, thus helping to save time in seeking for and purchasing new land and mitigating risk from failure to acquire land close to the existing area and risk associated with land price hike in the future. 3.2 Disadvantages and risks of the transaction (1) The Company incurs an increase in debts and interest expenses Before entering into the transaction, the Company and its subsidiaries, as of June 30, 2017, have total liabilities of Baht 1, million with a D/E ratio of 0.16 times. According to the pro-forma consolidated financial statements of AMA prepared by the Company s management as of June 30, 2017, AMA has total liabilities of Baht 1, million with a D/E ratio of 0.58 times. The liabilities of AMA mostly consist of loans from financial institutions of Baht million, raised by PNP and PSV for investment in and expansion of hospital business, and short-term loans from connected persons of Baht million, raised by AMA for subscription of newly issued shares of PNP. Therefore, after the completion of this transaction, the Company will bear higher debts from the consolidation of AMA Group s liabilities and higher interest expenses incurred on such loans. Besides, the Company will likely bear additional debts in the future from investments in hospital renovation, construction of new buildings of Pitsanuvej Hospital and Sahavej Hospital, and investments in new hospital development in the future, e.g. construction of Pitsanuvej Uttaradit Hospital, etc. (2) The Company incurs risk in procurement of future funds required for investment in the expansion of hospital and property businesses Under its 4-year investment plan ( ), the Company sets an approximate budget of Baht 5,688 million for investment in hospital and property businesses. Details of such investment plan, which includes the acquisition of AMA shares in this transaction of Baht 2,000 million, are as follows: Investment projects Investment budget of PRINC and its subsidiaries (Baht million) Total Remark Hospital business 1. Purchase of AMA shares 2,000 1,000 1, Pitsanuvej Uttaradit Hospital 1/ Tentative investment plan (excluding land) Property business 3. Project of BCD 2/ 1, Project of VR 3/ Total 3,804 1,160 1, S29 Project 4/ 1, Remain uncertain Grand total 5,688 1,160 1,823 1,587 1,118 Remark: At present, the Company still has no plan to develop the five plots of vacant land in the provinces (Ang Thong, Saraburi, Chiang Mai, Udon Thani and Rayong), which are under VB Group. 1/ Total investment budget is around Baht 430 million (excluding land in Uttaradit Province already acquired by PSV). Assuming that project financing facilities are obtained from financial institutions for 50% of such investment, or about Baht 215 million, equity financing will thus be required in the amount of approximately Baht 215 million. Since AMA holds a stake of 60% in PSV, the Company will be responsible for equity financing in the amount of about Baht 129 million. As such, if it raises loans to cover such 60% equity financing for PSV, the Company will bear additional debts of 215 (project financing) (60% of equity financing) = Baht 344 million. 2/ Under Bangkok Center District Co., Ltd., which is the Company s subsidiary. 3/ Project on renovation of Somerset Ekamai Bangkok hotel and serviced apartment under V Residence Co., Ltd. (a member of VB Group). 4/ Located on land on Sukhumvit Road, Soi Sukhumvit 29, under Bangkok Management Co., Ltd., which is the Company s subsidiary (a member of VB Group). Capital Advantage Company Limited Page 24/89

25 At present, PNPH has not yet operate the business and has no plan for business operation in the near future. (a) From our analysis of the Company s fund mobilization, if excluding S29 Project which remains uncertain, the Company will have to raise total loans for project financing and equity financing of a subsidiary of approximately Baht 3,804 million during (b) PSV plans to invest in construction of new buildings and procurement of additional medical tools and equipment of approximately Baht 450 million in 2018, which is its usual business expansion plan. PSV is able to seek loans from financial institutions by itself since its D/E ratio is only 0.5 times and it has assets to offer as collateral. As well, SHV plans to invest in construction of new buildings and procurement of additional medical tools and equipment of approximately Baht 88 million in 2018, which is its usual business expansion plan. SHV is also able to seek loans from financial institutions by itself since its D/E ratio is only 0.5 times and it has assets to offer as collateral. As mentioned above, the Company and its subsidiaries still need to raise a substantial amount of funds in the future, thus putting the Company at risk from funding for its future property development and additional investment in the hospital business. Nonetheless, all aforementioned projects are under its subsidiaries which own assets and are capable of securing project financing facilities by themselves. The Company will only have to raise funds for equity financing in each subsidiary. Therefore, taking into account (1) cash and short-term investments of the Company and its subsidiaries of Baht 1, million and cash and short-term investments of AMA Group of Baht million as at June 30, 2017; (2) cash flow from business operation of the Company and its subsidiaries in each year; and (3) the pro-forma consolidated financial statements (PRINC + AMA) as at June 30, 2017 showing the Company s total liabilities of Baht 5, million and equity of Baht 8, million, the Company (based on the pro-forma consolidated financial statements) will have a D/E ratio of only 0.57 times. Given that the investment in (a) and (b) above is funded by project financing of about 50% for each project and the Company entirely raises loans from financial institutions to cover the equity financing for its subsidiaries, the Company s D/E ratio under the consolidated financial statements will stay in a range of times in , which is considered relatively low. However, the investment mentioned above will be made on a gradual, not a one-off, basis, thus enabling the Company to manage the funding sources. Besides, the development of some projects could be postponed to match the Company s funding and the market situation at any such time. Meanwhile, the Company may seek to additionally raise funds from the capital market by, for instance, capital increase, issuance of warrants, etc., in which case it will pay attention primarily to the interest of and the impact on its minority shareholders. (3) Risk involved with procurement of long-term fund for investment in AMA shares to replace the Baht 1,000 million short-term loans from financial institutions Funding sources for this transaction will partly come from borrowing from financial institutions. At this stage, the Company has already received an offer for short-term loans (a term of not over one year) of Baht 1,000 million for the acquisition of AMA shares. Hence, the Company could be exposed to risk involved with fund raising to repay such short-term loans. However, as of June 30, 2017, the Company s D/E ratio stood at 0.16 times and, based on the pro-forma consolidated financial statements (PRINC + AMA) as at June 30, 2017, the Company has total liabilities of Baht 5, million and equity of Baht 8, million, with a D/E ratio of 0.57 times, which remains low. The Company will still be able to raise additional loans by offering the assets such as Somerset Ekamai Bangkok hotel and serviced apartment as collateral for those loans. (4) Time required for income generation to cover the cost of investment in renovation of PNP1 and PNP2 in In , PNP invested in land for hospital expansion and in hospital renovation and procurement of medical tools and equipment, and also invested in PNP2 to expand its hospital network, with a total budget spent of more than Baht 1,000 million. The overall healthcare market in Nakhon Sawan Province has not grown as fast as in Pitsanuloke Province. Its closer proximity to Bangkok provides patients who need complex medical treatment with an alternative to turn to private hospitals in Bangkok. As such, PNP s revenues may increase gradually (not as rapidly as desired), depending on the success in marketing, the quality and adequacy of physicians, and the service quality to attract customers to use its services instead of the hospitals in Bangkok or elsewhere. Furthermore, from the previous land purchase for its hospital expansion, PNP has three plots of vacant land available for future development, two plots of which are being used as car park and Capital Advantage Company Limited Page 25/89

26 one plot has just been transferred on September 8, 2017 at a value of approximately Baht 72 million. At present, it still has no plan for any new building construction, while it is necessary to acquire land nearby to be readily available for future network expansion. As a result, PNP may still not earn a worthwhile rate of return on assets or return on investment in the near term, but this will take a certain period of time. Though PNP1 and PNP2 are approximately 3 km. from each other, they are not competitors since both have different target group. PNP1 which is located on Phahonyothin Road shall focus on Emergency Center while PNP2 which is located in central area of Nakhon Sawan Province shall focus on Pediatric Center. (5) Intense competition in hospital business Despite its good growth potential, hospital business is faced with intense competition both from public hospitals that have opened healthcare facilities of the same standard as private hospitals and from international operators under the policy on health services liberalization. Foreign competitors have an edge in more advanced technology, a larger scale of hospital group network and a worldclass image. Thai private hospitals will still confront fierce competition triggered by the expansion of health market investment in Thailand in the recent past, resulting in a growing number of hospitals and hospital beds. Hence, there will likely be more intense competition among private hospitals in pricing, promotion campaigns for healthcare packages and special programs, and headhunting for medical personnel. Competition also comes from after-hours clinical services offered by state-run hospitals and their affiliates, and from medical schools (such as Siriraj Piyamaharajkarun Hospital and Somdech Phra Debaratana Medical Center, Ramathibodi Hospital), which have competitive advantages in terms of reputation, medical technology and specialized physicians. Such competitive environment will crucially affect private hospitals performance. However, current directors and management structure of the Company comprises of physicians (Mr. Pongsak Viddayakorn, M.D. and Mr. Soontorn Sritha, M.D.) with knowledge, experience, and expertise in hospital management. Thus, the Company views that it is well prepared for management of hospitals in AMA Group and there should be no risk regarding management of hospital by inexperienced management. (6) Risk associated with hospital business expansion AMA Group by PSV, which holds shares in PUH, plans to expand their scope of services by construction of Pitsanuvej Uttaradit Hospital 6 in Uttaradit Province. The project development is divided into two phases, phase 1 featuring the construction of Pitsanuvej Uttaradit Hospital on land area of about 11 rai and phase 2 featuring the development of a new business or economic center of the province on land area of 17 rai. In phase 1 with an outlay of Baht 500 million (including land), a new four-storied hospital will be established to offer secondary care services with a 50-bed capacity. It will be located in the intersection area that heads towards downtown of Uttaradit Province which is not far from Pitsanuloke Province and is one of the seven provinces in the lower northern region that offer patient referrals to Pitsanuvej Hospital in Pitsanuloke Province, thereby contributing to sharing of resources. For instance, a critical case that is beyond the capacity of Pitsanuvej Uttaradit Hospital will be transferred to Pitsanuvej Hospital (Pitsanuloke Province) for an advanced level of treatment, whereby the patient will not have to travel long distance. Besides, the Thai-Lao border crossing at Phu Du Checkpoint in Ban Khok District of Uttaradit Province may help to enhance the province s potential and allow for market penetration in some cities of Lao PDR. As such, the Company may face with risk concerning the new hospital construction in terms of, for example, construction delay, cost overrun, occurrence of any incident that may disrupt the construction and cause damage, and failure to meet the operational projection. However, before proceeding with the hospital construction, the Company will conduct a feasibility study to reassure its viability and will employ an experienced contractor to undertake the construction and a consulting firm to supervise and ensure that the construction work is on schedule. Moreover, it will be stipulated in the main contractor employment contract that PUH can charge a penalty from the main contractor in the event that it fails to complete the construction by the timeline mutually agreed upon in the contract. 6 Source: PSV and Capital Advantage Company Limited Page 26/89

27 (7) Risk from shortage of medical personnel Medical personnel, consisting of physicians, nurses and specialists in various fields, are very crucial to hospital business operation which must rely on medical personnel in different fields. Currently, the production of human resources for healthcare is still in a limited number, whereas famous physicians mostly work with public hospitals. Thus, it is costly to hire these physicians to work, whether part time or full time, with private hospitals, and the competition to snatch up medical personnel is more likely to take place. In addition, amid the growing healthcare business and emergence of an aging society, all hospitals must prepare themselves for future business expansion, leading to an increasing demand for experienced and quality medical staff. Since the development of skill, knowledge and capability of these medical personnel is time-consuming, the business will likely be affected by a shortage of medical staff in various fields in the future. Nonetheless, the hospital in AMA Group is located close to a state university which offers the relevant fields of studies such as Faculty of Medicine, Faculty of Nursing, Faculty of Pharmaceutical Science, and Faculty of Medical Science (Naresuan University, Pitsanuloke Province). At the same time, PSV has collaborated with several nursing colleges in nurse production and personnel development. Apart from medical staff preparation, PSV has continuously developed its current resources. (8) Risk from changing technology for medical equipment The more complex and severity of diseases results in the need for state-of-the-art medical equipment. Giving top priority to the quality of diagnosis and treatment of their patients, AMA Group has consistently invested in modern medical tools and equipment. However, the current fast-changing medical technology may leads to frequent changes in technology for some medical equipment which may involve a high maintenance cost, thus likely affecting investment worthiness. AMA Group, however, has a policy to determine and analyze the qualification, benefit and worthiness of medical equipment in the long run before making any investment decision to ensure cost efficiency and maximum benefit for the hospital. (9) Risk of facing lawsuits for damage claims arising from medical services Hospital business is faced with a threat of legal actions brought by patients or their related persons due to dissatisfaction with services or treatment results from physicians or specialists fail to meet their expectations. AMA Group has developed service quality and applied modern treatment technology. Moreover, it has medical malpractice insurance to protect against claims by patients who find the treatment results failing to meet their expectations. The insurance covers not only the liability for unintentional treatment errors but also the litigation expenses. With years-long experience of its physicians, the assessment of service quality, treatment results and customer satisfaction, and the acquaintance with local people it serves, the Company is confident that it is able to build customer satisfaction. 4. Comparison of advantages and disadvantages between entering into the transaction with the connected persons and the transaction with a third party The Company has an intention to diversify its investment into the healthcare sector and has held discussions with several hospital operators, both listed and not listed on the SET, which could not yet be finalized. Among them, AMA was the first to settle the business acquisition deal with the Company at a price that will enable the Company to gain benefit in the future with a favorable internal rate of return and more attractive payment terms than those offered by third party. Advantages and benefits of entering into the transaction with the connected persons 1) The acquisition price for AMA shares of Baht 2,000 million is deemed reasonable since it is lower than AMA s book value and fair value determined by the IFA of Baht 2, , million, and cheaper than the acquisition from a third party considering that it is not possible to negotiate with any third party to sell the business at price below book value. Furthermore, the payment terms offered by AMA are favorable, allowing the Company to make a gradual payment. As such, it does not have to promptly raise total funds to make a one-off payment for AMA shares on Share Sale and Purchase Date, thus helping to reduce its finance costs that could otherwise affect its business performance. 2) AMA itself acquired shares in PNP1, PNP2, PSV and SHV in 2016 and has already streamlined their business process and administration system, renovated the buildings and rooms, additionally procured modern medical equipment, additionally recruited medical personnel and reception & customer service staff, and upgraded IT system, thus helping to Capital Advantage Company Limited Page 27/89

28 save time for the Company to undertake the foregoing by itself. (The strengths of these hospitals, which are in the provinces and, mostly, have long been opened to service, are that they were already built, have a license, are strategically located in midtown area, and have their own customer base and teams of physicians, nurses and personnel. However, the weaknesses lie in their old buildings and obsolete equipment, business process and IT system.) 3) AMA has already revised the accounting system of PNP, PSV and SHV, whereby the financial statements for 2016 of AMA, PSV, PNP and PNPH were already audited by the SEC-approved auditor, who is making a quarterly review for 2017 and will further make a yearly audit for 2017 on all members of AMA Group, thus helping to save time for the Company to undertake the foregoing by itself. The Company will also save time and reduce the burden on compilation of AMA Group s information into a systematic pattern. Therefore, after the transaction, the preparation of its consolidated financial statements can be made without any delay. Disadvantages of entering into the transaction with the connected persons 1) Extra expenses will be incurred on employment of an IFA and arrangement of the shareholders meeting required for the connected transaction. 2) The Company will incur higher audit fees than in case it purchases other hospitals (asset acquisition) or hospital operation companies in general since AMA has two direct subsidiaries, which are PSV and PNP, and four indirect subsidiaries, namely SHV, PUH, PPC, and PNPH. 5. Other issues Shares of the Company may be transferred from Property Development Sector to Health Care Services Sector. At present, most of the Company s revenues are from property development business. Revenues from services were Baht million and Baht million in 2016 and in the first half of 2017, respectively. After acquisition of AMA shares, the Company shall have different revenue structure as AMA had revenue from services (hospital business) of Baht 1, million and Baht million in 2016 and in the first half of 2017, respectively, higher than current revenue from property development of the Company. After the acquisition of AMA shares, the Company shall have ratio of revenue from services (hospital business) to total revenue from services of 83.62% and 77.16% in 2016 and in the first half of 2017, respectively. (Based on the pro-forma financial statement in Part 2 Clause 2 of this report) The Company s shares are currently traded under the SET s Property & Construction Industry Group, Property Development Sector. After the acquisition of AMA shares, the Company s main income source will be revenues from services from hospital business. Under the SET s criteria, industry group and sector classification is determined mainly on the basis of the business which produces more than 50% of the listed company s revenue. Thus, (a) the SET will review the Company s industry group and sector by considering primarily on the information submitted in Form 56-1, or (b) the Company may request the SET to review its classification. Consideration of industry group and sector reclassification is the sole decision of the SET. Remark: - The Property & Construction Industry Group (PROPCON), Property Development Sector (PROP) recorded an average P/E ratio in the past one year (September 26, September 25, 2017) of approximately times. (Source: - The Service Industry Group (SERVICE), Health Care Services Sector (HELTH) recorded an average P/E ratio in the past one year (September 26, September 25, 2017) of approximately times. (Source: Capital Advantage Company Limited Page 28/89

29 6. Conclusion of the IFA s opinion on reasonableness of the acquisition of assets and the connected transaction The expansion of investment in property business in V Brilliant Group Holding Co., Ltd. s group of companies ( VB Group ) in late 2016 has enabled the Company to grow its recurring income assets. Those assets help to boost its revenues to some extent, though; the Company has still incurred a net loss from operation since 2016, primarily due to an increase in administrative expenses and finance costs. Besides, the Company has not yet started development of property for sales projects on the investment properties owned by the Company. As such, the Company views that the business acquisition through purchase of AMA shares will help to immediately increase its income and performance, improve the profit generating ability of its business groups in the future, create additional income sources, diversify risk involved with income source, and lessen its sole reliance on income source from the property business. The Company will broaden its business scope to the hospital business which shows a good growth potential in the wake of greater health concerns, growing demand for healthcare services as Thailand will become an aging society in the future, and the government sector s strategy to develop Thailand into a medical hub. The advantages and benefits from entering into this transaction are as follows: (1) the transaction provides an opportunity for the Company to expand business into the private hospital sector, which exhibits a robust growth rate; (2) Investment risk can be diversified, with an increase in income sources; (3) The Company can immediately recognize income from hospital business and improve its financial position and performance; (4) The acquisition price of AMA shares is lower than the book value and the fair value measured by the IFA; (5) The terms of payment for AMA shares are favorable, helping to relieve the burden of prompt fund raising for total share payment on Share Sale and Purchase Date; (6) PNP1 and PPC have nearby land plots readily available for future business expansion; (7) AMA has already streamlined the business process and administration system, renovated the buildings and rooms, additionally procured modern medical equipment, additionally recruited medical personnel and reception & customer service staff, and upgraded IT system, thus helping to save time for the Company to undertake the foregoing by itself. Lastly; and (8) AMA has already revised the accounting system of PNP, PSV and SHV, whereby the financial statements for 2016 of AMA, PSV, PNP and PNPH were already audited by the SEC-approved auditor, who is making a quarterly review for 2017 and will further make a yearly audit for 2017 on all members of AMA Group, thus helping to save time for the Company to undertake the foregoing by itself. At the same time, there are certain disadvantages and risks from the transaction as follows: (1) an increase in debts and interest expenses; (2) a substantial future funding need for investment in the expansion of hospital and property businesses; (3) risk involved with procurement of long-term fund for investment in AMA shares to replace the Baht 1,000 million short-term loans from financial institutions; (4) time required for income generation to cover the cost of investment in renovation of PNP1 and PNP2 in ; (5) intense competition in hospital business; (6) risk associated with hospital business expansion; (7) risk from shortage of medical personnel; (8) risk of facing lawsuits for damage claims arising from medical services; (9) incurrence of extra expenses on employment of an IFA and arrangement of the shareholders meeting required due to the connected transaction; and (10) incurrence of higher audit fees than in case of purchase of other hospitals (asset acquisition) or hospital operation companies in general since AMA Group consists of as many as six member companies. From this transaction, shares of the Company may be transferred from Property Development Sector to Health Care Services Sector due to the change in revenue structure. Currently, revenue of the Company derived mainly from property development. However, most of the revenue shall be from hospital business after completion of this transaction. Consideration of industry group and sector reclassification is the sole decision of the SET. In view of the rationale and necessity of the transaction together with the comparison of advantages, benefits, disadvantages and risks from entering into the transaction, the IFA is of the opinion that the acquisition of assets and the connected transaction are reasonable and will benefit the Company and its shareholders in the long term. With regards to the acquisition of AMA, most of current management of hospitals in AMA Group who has knowledge, experience, and expertise in hospital management shall continue to work with the Company. Additionally, directors and executives of the Company (Mr. Pongsak Viddayakorn, M.D. and Mr. Soontorn Sritha, M.D.) already have knowledge, experience, and expertise in hospital management. Thus, the Company views that it is well prepared for management of hospitals obtained from acquisition of AMA. Capital Advantage Company Limited Page 29/89

30 Part 3: Opinion of the Independent Financial Advisor on the Appropriateness of the Purchase Price of the Acquisition of Assets and the Connected Transaction The Independent Financial Advisor has considered the appropriateness of the acquisition price of the ordinary shares and preferred shares of Alliance Medical Asia Company Limited ( AMA ) from existing shareholder, totaling of 268,374,998 shares, or equivalent to 99.99% of total issued and paid-up shares of AMA. The acquisition price is approximately Baht per share, totaling not more than Baht 2,000 million. AMA is a holding company, currently holding shares directly in 2 subsidiaries and indirectly in 4 subsidiaries (collectively called AMA Group ) as follows: Company Registered Capital (Baht) Paid-up Capital (Baht) AMA s shareholding AMA s shareholding - net 1) Pitsanuloke Medical Company Limited 125,000, ,000, % 60.00% ( PSV ) 2) Union Pichit Doctors Company Limited 100,000, ,000, % held 60.00% ( SHV ) through PSV 3) Pitsanuvej Uttaradit Hospital Company 1,000,000 1,000, % held 60.00% Limited ( PUH ) through PSV 4) Pitsanuvej Ptttana Company Limited 1,000,000 1,000, % held 60.00% ( PPC ) through PSV 5) Paknampo Hospital Company Limited 354,166, ,166, % 90.92% ( PNP ) 6) P.N.P Hospital Company Limited ( PNPH ) 150,000,000 37,500, % held through PNP 90.92% CapAd evaluated the appropriateness of the acquisition price of AMA s shares by using information obtained from PRINC and AMA Group, interview with the managements of the Company and AMA Group, property appraisal reports prepared by Independent Property Appraiser and other significant agreements, including other publicly-disclosed information such as Form 56-1, audited and reviewed financial statements, and information from the SET s website. CapAd s evaluation based mainly on the assumptions that information and documents provided are true, complete and accurate at present. Therefore, any change of such information may materially affect business operations of AMA Group as well as the shareholders decision in considering the appropriateness of the acquisition prices. CapAd applied 6 approaches in evaluating the fair value of AMA s shares, namely: 1) Book Value Approach 2) Adjusted Book Value Approach 3) Market Value Approach 4) Price to Book Value Ratio Approach: P/BV Ratio 5) Price to Earnings Ratio Approach: P/E Ratio 6) Discounted Cash Flow Approach However, CapAd did not apply the Market Value Approach since AMA is not listed on the SET or any secondary stock exchanges. Thus, the market price of AMA s shares could not be calculated. Thus, only 5 approaches shall be applied. After studying such information and documents, as well as other relevant information, CapAd s opinion on the appropriateness of the fair values of AMA s shares can be summarized as follows: Capital Advantage Company Limited Page 30/89

31 1. Book Value Approach This approach determines AMA s shares value at a certain period. In this case, the calculation was based on AMA s pro-forma financial statements 7 as of December 31, 2016, prepared by the management of the Company under instructions from the Company s auditor. However, the pro-forma financial statements were not audited and reviewed by a certified auditor. Therefore, the actual accounting records may differ from those in AMA s pro-forma financial statement prepared by the Company s management, depending on discretion of the Company and its auditor as of the execution date of this transaction. Based on such pro-forma financial statements, book value of AMA s shares can be calculated as follows: (Unit: Baht million) Issued and paid-up capital 1,372,000 preferred shares at par value of Baht 10 each ,003,000 ordinary shares at par value of Baht 10 each 2, Premium on preferred shares Retained earnings - unappropriated Equity attributable to equity holders of parent (1) 2, Non-controlling interests (NCI) Total shareholders equity 3, No. of paid-up shares as of December 31, 2016 (million shares) (2) / Book value per share parent (Baht) (1)/(2) / Remark: 1/ Comprising of 1,372,000 preferred shares and 267,003,000 ordinary shares at par value of Baht each. 2/ Preferred shares of AMA are entitled to receive dividend at the rate of 4 times over the dividend paid to the ordinary shareholders in the year that a dividend is declared. Upon dissolution of AMA, the preferred shareholders are entitled to receive the return of paid-up capital and premium on preferred shares from liquidation of the remaining assets of AMA in preference to the ordinary shareholders. If there is remaining capital after the ordinary shareholders receive the paid-up amount of each ordinary share, the preferred shareholders are entitled to 4/5 of the remaining capital and the ordinary shareholders are entitled to the remaining amount after allotment to the preferred shareholders. However, in this Transaction, the Company will acquire % of registered and paid-up capital of AMA. CapAd, therefore, shall consider fair value of ordinary shares and preferred shares in the same basis (class) and shall not consider term and conditions of the preferred shares. The value of AMA s shares based on this approach is equal to Baht per share 8 and the firm value of AMA is equal to Baht 2, million. (If applied the financial statement of AMA for the year ended December 31, 2016 (Company Only), audited by a certified auditor, the value of AMA s shares is equal to Baht per share and the firm value AMA is equal to Baht 2, million.) 7 Based on financial statements (company only) of AMA, PSV, SHV, PNP and PNPH (excluding PUH and PPC due to PUH and PPC were founded on June 2, 2017 and September 15, 2017, respectively) which were audited by certified auditors. (The financial statements for the year ended December 31, 2016 of AMA, PSV, PNP and PNPH were audited by PricewaterhouseCoopers ABAS Ltd. and the financial statements for 3 months ended December 31, 2016 were audited by Mrs. Prisana Suwanprasop.) 8 Preferred shares are entitled to receive dividend at the rate of 4 times over the dividend paid to the ordinary shareholders in the year that a dividend is declared. Upon dissolution of AMA, the preferred shareholders are entitled to receive return of paidup capital and premium on preferred shares from liquidation of the remaining assets of AMA in preference to ordinary shareholders. If there is remaining capital after ordinary shareholders receive the paid-up amount of each ordinary share, the preferred shareholders are entitled to 4/5 of the remaining capital and the ordinary shareholders are entitled to the remaining amount after the preferred shareholders. However, in this Transaction, the Company will acquire % of registered and paid-up capital of AMA. CapAd, therefore, shall consider fair value of ordinary shares and preferred shares in the same basis (class) and shall not consider term and conditions of the preferred shares. Capital Advantage Company Limited Page 31/89

32 2. Adjusted Book Value Approach By this approach, the share value is derived from total assets, deducted by total liabilities including commitments and contingent liabilities as shown in the latest financial statements as of December 31, 2016 (Company Only), audited by a certified auditor approved by the SEC, and adjusted by items occurred after the end of accounting period or the items that may reflect the actual value of assets and liabilities. The adjustment items may include unrealized gain or loss from assets revaluation, tax saving from losses carried forward, contingent liabilities and/or event after financial statement date. Consequently, the adjusted book value is divided by total number of AMA s paid-up shares. In deriving the value of AMA s ordinary shares, the IFA used book value as shown in the latest financial statements as of December 31, 2016 (Company Only), audited by a certified auditor. CapAd considered the significant adjustments as follows: 2.1 Gain (loss) from revaluation of assets AMA is a holding company, and most of its assets are investment in 6 companies (currently holding shares directly in 2 subsidiaries, and indirectly in 4 subsidiaries). Therefore, CapAd shall consider the fair value of the fixed assets of the subsidiaries instead of the fixed asset of AMA. PSV, SHV and PNP had their assets revalued by an independent appraiser. Therefore, CapAd has taken the appraised value by the independent appraiser into consideration and adjusted book value of AMA shares with the difference between the appraised value and the book value of those assets. Details of asset appraisal of each company are as follows Pitsanuloke Medical Company Limited ( PSV ) The appraised assets of PSV are as follows: Property, plant and medical equipment of Pitsanuvej Hospital Vacant land in Uttaradit Details are as follows: (1) Property, plant and medical equipment of Pitsanuvej Hospital Pitsanuvej Hospital is located at 211 Pirentoratep Road, Muang Pitsanuloke District, Pitsanuloke Province on 22 plots of land, totaling of rai. Year Appraisal Co., Ltd. ( Independent Property Appraiser ), an independent property appraiser approved by the SEC, has been appointed by the Company to appraise value of Property, plant and medical equipment of Pitsanuvej Hospital. The Independent Property Appraiser had surveyed the assets and conducted the appraisal on August 17, 2017, September 3, 2017 and September 16, 2017, with the public purpose, based on the report dated September 6, 2017 (No. 2706/2560 and No. 2673/2560) and October 2, 2017 (No. 3011/2560), respectively. The Independent Property Appraiser applied the Income Approach for the valuation of the appraised assets, and used the Cost Approach for verification of the value of the appraised assets. Details of the appraisal are as follow: a. Land 22 plots of land with total areas of rai (3,803 sq.wah) has been used for construction of building of Pitsanuvej Hospital and parking areas. The lands were divided into 2 groups as follows; Land Group 1: consisted of 14 plots of land with total areas of rai (545.5 sq.wah). It is currently used as parking areas. Details of land are as follows: No. Land title deed No. Land No. Survey page Land area as per title deed Owner Encumbrance Rai Ngan Sq.wah Pitsanuloke Medical None Company Limited Total area Land Group Capital Advantage Company Limited Page 32/89

33 Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, Land Group 2: consisted of 8 plots of land with total areas of rai (3,257.5 sq.wah). It is currently used for 9-storey building with a basement and supporting buildings. Details of land are as follows: No. Land title deed No. Land No. Survey page Land area as per title deed Owner Encumbrance Rai Ngan Sq.wah Pitsanuloke Medical Bank of Ayudhya Public Company Limited Company Limited Total area Land Group Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, b. Building and improvement Summary of the appraised building and improvements are as follows: Building and improvement - PSV Usable areas Age of Located on land title deed No. (sq.m.) assets (Year) 1 9-storey hospital building with a basement Title deed No , and - Basement 2, Floor , Rooftop and helipad Building improvement Floor 4 5 1, storey hospital building Title deed No Interior area 3, Open area with shed storey reinforced concrete building 2, Title deed No storey parking building Title deed No , 406 and - Floor 1 6 9, Building improvement (rooftop) 1, storey utility building Title deed No Shop building (Call I Waffle) Title deed No and Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, c. Medical equipment The Independent Property Appraiser had surveyed the assets and conducted the appraisal with the public purpose on September 16, 2017, according to the report dated October 2, 2017 (No. 3011/2560). The Independent Property Appraiser applied only the Cost Approach as valuation methodology for medical equipment as there was no information in relation to selling/purchasing of similar assets. The Independent Property Appraiser applied the Replacement Cost New adjusted with depreciation of the assets on straight-line basis or other methods suitable for the valuation of medical equipment. Factors affecting depreciation of the appraised assets are (1) physical life (2) physical deterioration (3) functional obsolescence (4) economic / external obsolescence. Details of the valuation of PSV s medical equipment are as follows; Medical equipment - PSV Quantity (items) Physical life (years) Remaining useful life (years) Replacement cost new 1/ (Baht million) Replacement cost new less depreciation (Baht million) 1 MRI Scanner Cath lab Surgical microscope Operating microscope Echocardiography Infusion pump Fluoroscopy diagnostic X-ray C-Arm X-ray unit D dental x-ray Anesthetic machine Laser lithotripsy Ultrasound scanner Capital Advantage Company Limited Page 33/89

34 Medical equipment - PSV Quantity (items) Physical life (years) Remaining useful life (years) Replacement cost new 1/ (Baht million) Replacement cost new less depreciation (Baht million) 13 Phacoemulsification units Heart-lung machine Operation table Electrosurgical unit Gastroscope Dental unit Dental unit Patient monitor Colonoscope and endoscope D digital ultrasound D digital ultrasound Total Other medical equipment 1, / Total medical equipment net of depreciation 1, Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 3011/2560 dated October 2, Remark: 1/ Replacement costs of the medical equipment were based on the document from PSV and adjusted with price index of machinery and equipment. 2/ The Independent Property Appraiser did not revalue the medical equipment with the book value less than Baht 1.00 million, totaling 1,152 items, but applied the book value of such assets instead. Based on the appraisal report prepared by the Independent Property Appraiser No. 3011/2560 dated October 2, 2017 by the Replacement Cost Approach and the book value of assets, the value of the medical equipment of PSV is equal to Baht million. d. Valuation approach The Independent Property Appraiser applied the Income Method by using Discounted Cash Flow Technique to identify the market value for the appraised assets as the assets are considered income generating property. In addition, the Cost Method was used as a verification method. Details are as follows; Income Method of Valuation Discounted Cash Flow Technique The discounted cash flow model was generally applied to assets that generate income by assuming that value of assets equal to present value of total income expected to receive from such assets in the future. Net income of the assets are calculated then discounted to present value. In preparation of revenue and expense projection, the Independent Property Appraiser assumed base revenues and expenses from historical performance of the year and adjusted with average inflation rate of 2.30% per annum to arrive the operating cash flows of the year 1 st 11 th. Assumptions for the valuation are as follows; Income Approach: PSV Amount 1 Business type General hospital 2 Registered bed 150 beds 3 Revenue from medical services - OPD Average OPD 559 cases per day Average OPD revenue Baht 1,800 per case - IPD Average IPD 52 cases per day Average IPD revenue Baht 29,170 per day 4 Other incomes 2% of revenue from medical service income 5 Cost of medical services 65% of revenue from medical services income 6 Selling and administrative expenses 20% of total revenues 7 Inflation rate Average 2.30% per annum 8 Projection period 10 years and Year 11 for estimation of terminal value 9 Cost of asset disposal 2% of selling price of assets 10 Terminal Cap Rate 7.90% per annum 11 Cost of equity 13.40% per annum 1/ 12 Cost of debts 6.50% per annum 13 D/E ratios 0.98 times 14 Discount rate 10.73% per annum 15 Present value of cash flow Baht 1,893,100,000 (rounding) Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, Remark: The Independent Property Appraiser considered the historical performance of PSV for the year as a base price. 1/ The Independent Property Appraiser assumed the return on investment in 10-year government bond as of July 27, 2017 at approximately 2.55% per annum and added Equity Country Risk Premium x Beta and adjusted with risk premium for hospital business of around 1% per annum. Capital Advantage Company Limited Page 34/89

35 The Independent Property Appraiser deemed that the Income Approach could reflect market value of the asset of Pitsanuvej Hospital due to the appraised assets are income generating assets. The appraised value derived from the Income Approach could reflect the highest and best use value of the assets better than the Cost Approach. From such approach, market value of the assets is equal to Baht 1, million. The IFA has made comparison of the appraisal price of the assets of Pitsanuvej Hospital derived from the Income and Cost Approaches as follows: (Unit: Baht million) Appraisal Price - PSV Cost Approach Income Approach Land 1/ Building and improvements Medical equipment Total , Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, The appraisal report prepared by Year Appraisal Co., Ltd. No. 3011/2560 dated October 2, Remark: 1/ Land Group 1 with total value of Baht Baht 50,000 per sq.wah, and Land Group 2 with total value of Baht Baht 45,000 per sq.wah. CapAd is of the opinion that the asset appraisal by the Income Approach is appropriate because this is an income-generating asset which can generate revenue at present and in the future. Thus, cash flow generating capability of such assets should be considered for the determination of asset value. Conclusively, the appraisal value of land, building and medical equipment of Pitsanuvej Hospital by the Independent Property Appraiser is equal to Baht 1, million. (2) Vacant land in Uttaradit Eight plots of vacant land with total areas of rai (11, sq.wah) situated next to Pitsanuloke Denchai Road (Highway No.11), k.m , Pa Sao Sub-district, Muang Uttaradit District, Uttaradit Province. Year Appraisal Co., Ltd. ( Independent Property Appraiser ), an independent property appraiser approved by the SEC, has been appointed by the Company to appraise value of vacant land of PSV. The Independent Property Appraiser had surveyed the assets and conducted the appraisal on September 3, 2017, with the public purpose, based on the report dated September 6, 2017 (No. 2673/2560). The Independent Property Appraiser applied the Market Approach for the valuation of the appraised assets. Details are as follows: No. Land title Land Survey Land area as per title deed Owner Encumbrance deed No. No. page Rai Ngan Sq.wah Pitsanuloke Medical None Company Limited Total area Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2673/2560 dated September 6, By using the Market Approach, the Independent Property Appraiser had conducted survey on market information of assets regarding the selling/offering price of assets at coincide time and in adjacent area which possess similar characteristics as the appraised asset for comparison and analysis. With this regards, there were 4 selected data of vacant land located next to Pitsanuloke Denchai Road or Thung Kalo Rural Road for comparison with the offering/selling price during Baht 3,250 7,917 per sq.wah. Then, factors affecting land value including location, shape and size of land, physical characteristics, type, and their potential as well as time consuming were evaluated by applying Weighted Quality Score (WQS). Thus, the market value of land appraised by the Independent Property Appraiser is Baht 7,500 per sq.wah or total market value of Baht million. The IFA is of the same opinion as the Independent Property Appraiser regarding the appropriateness of land data for comparison as it represents the market data of land with the available market price of land sold/offering for sale at current situation and located in adjacent area to the appraised land. In addition, the Independent Property Appraiser has adjusted the market data of Capital Advantage Company Limited Page 35/89

36 comparable land to make them mostly similar to PSV s assets in order to closely reflect the fair market value. Based on the appraisal report prepared by Year Appraisal Co., Ltd. No. 2673/2560 dated September 6, 2017, the total market value of PSV s lands in Uttaradit Province by the Market Approach is equal to Baht million. Summary of the book value and the appraised value by the Independent Property Appraiser From comparison of the book value of PSV s asset and the appraised value by the Independent Property Appraiser, it is found that the appraised value is higher than the book value as at June 30, 2017, which was the date close to the appraisal date most. Details are as follows: (Unit: Baht million) PP&E of PSV Book value as of June 30, 2017 Appraised Value Appraised Value Higher (Lower) Than Book Value (1) (2) (2) (1) Appraised assets 1. Land Pitsanuloke , /2/ 1, Building and improvements Medical equipment Land - Uttaradit / (25.66) Total value of appraised assets , , Less: Deferred tax liabilities (319.66) 4/ Total adjustment to shareholders equity 1, of PSV Remark: 1/ The appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 3011/2560 dated October 2, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 2673/2560 dated September 6, / CapAd assumed deferred tax liabilities at 20% of the difference between the appraised value and book value of the appraised assets, and deferred tax assets at 20% of the difference between the appraised value and book value of the appraised assets (excluding loss from revaluation of land based on conservative basis). 9 1, x 20% = Thus, CapAd has adjusted the shareholders equity of PSV - net of deferred tax liabilities by Baht 1, million. 9 Thai Accounting Standard No. 16 (TAS 16): Property, Plant, and Equipment stated that if company chooses to recognize its assets according to revaluation values, such company must realize gain (loss) from asset revaluation and tax consequence from such revaluation according to TAS 12: Income Tax. Thai Accounting Standard No. 36 (TAS 36): Impairment of Assets stated that if company realized loss from impairment of assets, such company must identify asset or deferred tax liabilities according to TAS 12: Income Tax. Thai Accounting Standard No. 12 (TAS 12): Income Tax stated that an appraisal or revaluation of assets shall lead to difference between book value of revalued assets and tax base, which shall be realized as deferred tax assets or liabilities regardless of the company s intention to sell such assets. In determining share value under the Adjusted Book Value Approach, the IFA has adjusted the appraised value to reflect assets fair value. The IFA, therefore, has considered assets (liabilities) and deferred tax assets (liabilities) since it may affect book value of the shares according to the aforementioned TAS. CapAd viewed that it is reasonable to apply the estimated value of assets (liabilities) and deferred tax assets (liabilities) in share valuation. Capital Advantage Company Limited Page 36/89

37 2.1.2 Union Pichit Doctors Company Limited ( SHV ) The appraised assets of SHV are property, plant and medical equipment of Sahavej Hospital located at 2/158 Sri Mala Road, Nai Muang Sub-district, Muang Pichit District, Pichit Province, on 7 plots of land, totaling of rai. Year Appraisal Co., Ltd. ( Independent Property Appraiser ), an independent property appraiser approved by the SEC, has been appointed by the Company to appraise value of Property, plant and medical equipment of Sahavej Hospital. The Independent Property Appraiser had surveyed the assets and conducted the appraisal on August 7, 2017 and September 16, 2017, with the public purpose, based on the report dated September 5, 2017 (No. 2684/2560) and October 2, 2017 (No. 3012/2560), respectively. The Independent Property Appraiser applied the Income Approach for the valuation of the appraised assets, and the Cost Approach for verification of the value of the appraised assets. Details of the valuation are as follows: a. Land Seven plots of land with total areas of rai. It is currently used for 4-storey building and supporting buildings of Sahavej Hospital. Details of land are as follows: No. Land title deed No. 1 Nor Sor 3 Kor No Nor Sor 3 Kor No Nor Sor 3 Kor No Nor Sor 3 Kor No Nor Sor 3 Kor No Nor Sor 3 Kor No Nor Sor 3 Kor No. 853 Land No. Survey page Land area as per title deed Owner Encumbrance Rai Ngan Sq.wah Union Pichit Doctors - Company Limited Krung Thai Bank PCL Krung Thai Bank PCL. Total area Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2684/2560 dated September 5, b. Building and improvement Summary of the appraised building and improvements are as follows: Building and improvement SHV Usable areas Physical Located on land title deed No. (sq.m.) life of assets (Year) 1 4-storey hospital building 4, Nor Sor 3 Kor No storey hospital building 2, Nor Sor 3 Kor No storey house for doctor No Nor Sor 3 Kor No storey house for doctor No Nor Sor 3 Kor No storey house for doctor No Nor Sor 3 Kor No units of 2-storey house for doctor 24 Nor Sor 3 Kor No Interior Balcony area Open area with shed Guard house Nor Sor 3 Kor No Drinking water plant Nor Sor 3 Kor No Garbage building Nor Sor 3 Kor No. 229 and Storage building Nor Sor 3 Kor No. 230 and Generator building Nor Sor 3 Kor No Open area with shed for motorcycle parking Nor Sor 3 Kor No. 852 No Open area with shed for motorcycle parking Nor Sor 3 Kor No. 852 No Open area with shed for car parking No Nor Sor 3 Kor No Open area with shed for car parking No Nor Sor 3 Kor No Open area with shed for car parking No Nor Sor 3 Kor No Improvements - Fence 2 x 625 m. 1, Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2684/2560 dated September 5, Capital Advantage Company Limited Page 37/89

38 c. Medical equipment The Independent Property Appraiser had surveyed the assets and conducted the appraisal with the public purpose on September 16, 2017, according to the report dated October 2, 2017 (No. 3012/2560). The Independent Property Appraiser applied only the Cost Approach as valuation methodology for medical equipment as there was no information in relation to selling/purchasing of similar assets. The Independent Property Appraiser applied the Replacement Cost New adjusted with depreciation of the assets on straight-line basis or other methods suitable for the valuation of medical equipment. Factors affecting depreciation of the appraised assets are (1) physical life (2) physical deterioration (3) functional obsolescence (4) economic / external obsolescence. Details of the valuation of SHV s medical equipment are as follows; Medical equipment - SHV Quantity (items) Physical life (years) Remaining useful life (years) Replacement cost new 1/ (Baht million) Replacement cost new less depreciation (Baht million) 1 EBM PACC & CR30-XM AGFA CT Scan Toshiba Fluoroscopy diagnostic X-ray Diagnostic X-Ray System Electronic Video Endoscopy System Surgical drill Total Other medical equipment / Total medical equipment net of depreciation Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 3012/2560 dated October 2, Remark: 1/ Replacement costs of the medical equipment were based on the document from SHV and adjusted with price index of machinery and equipment. 2/ The Independent Property Appraiser did not revalue the medical equipment with the book value less than Baht 1 million, totaling 551 items, but applied the book value of such assets instead. Based on the appraisal report prepared by the Independent Property Appraiser No. 3012/2560 dated October 2, 2017 by the Replacement Cost Approach and the book value of assets, the value of the medical equipment of SHV is equal to Baht million. d. Valuation approach The Independent Property Appraiser viewed that the Income Approach by using Discounted Cash Flow Technique is an appropriate approach to identify market value for the appraised assets. In addition, the Cost Method was used as a verification method. Details are as follows; Income Approach of Valuation Discounted Cash Flow Technique The Discounted Cash Flow Technique was generally applied to assets that generate income by assuming that value of assets equal to present value of total income expected to receive from such assets in the future. Net income of the assets are calculated then discounted to present value. In preparation of revenue and expense projection, the Independent Property Appraiser assumed base revenues and expenses from historical performance of the year and adjusted with average inflation rate of 2.30% per annum to arrive the operating cash flows of the year 1 st 11 th. Assumptions for the valuation are as follows; Income Approach: SHV Amount 1 Business type General hospital 2 Registered bed 90 beds 3 Revenue from medical services - OPD Average OPD 250 cases per day Average OPD revenue Baht 650 per case - IPD Average IPD 22 cases per day Average IPD revenue Baht 16,000 per day 4 Other incomes 2.5% of revenue from medical services income 5 Cost of medical services 70% of revenue from medical services income 6 Selling and administrative expenses 17% of total revenues 7 Inflation rate Average 2.30% per annum 8 Projection period 10 years and Year 11 for estimation of terminal value 9 Cost of asset disposal 2% of selling price of assets 10 Terminal Cap Rate 7.90% per annum 11 Cost of equity 13.40% per annum 1/ 12 Cost of debts 6.50% per annum 13 D/E ratios 0.98 times 14 Discount rate 10.73% per annum 15 Present value of cash flow Baht 351,500,000 (rounding) Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2684/2560 dated September 5, Capital Advantage Company Limited Page 38/89

39 Remark: The Independent Property Appraiser considered the historical performance of SHV for the year as a base price 1/ The Independent Property Appraiser assumed the return on investment in 10-year government bond as of July 27, 2017 at 2.55% per annum, and added Equity Country Risk Premium x Beta and adjusted with risk premium for hospital business around 1% per annum The Independent Property Appraiser determined value of SHV s assets by using the Income Approach as it viewed that the appraised value derived from the Income Approach could reflect the highest and best use value of the assets better than the Cost Approach. Therefore, market value of the assets is equal to Baht million. The IFA has compared the appraisal price of the assets of SHV derived from the income and cost approaches as follows: (Unit: Baht million) Appraisal Price - SHV Cost Approach Income Approach Land /2/ Building and improvements / Medical equipment / Total / Remark: 1/ The market price of land is Baht 21,000 per sq.wah. 2/ The appraisal report prepared by Year Appraisal Co., Ltd. No. 2684/2560 dated September 6, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 3012/2560 dated October 2, CapAd is of the opinion that the asset appraisal by the Income Approach is appropriate because this is an income-generating asset which can generate revenue at present and in the future. Thus, cash flow generating capability of such assets should be considered for the determination of asset value. Conclusively, the appraisal value of land, building and medical equipment of SHV by the Independent Property Appraiser is equal to Baht million. Summary of the book value and the appraised value by the Independent Property Appraiser From comparison of the book value of SHV s assets and the appraised value by the Independent Property Appraiser, it is found that the appraised value is higher than the book value as at June 30, 2017, which was the date closest to the appraisal date. Details are as follows: (Unit: Baht million) PP&E of SHV Book value as of June 30, 2017 Appraised Value Appraised Value Higher (Lower) Than Book Value (1) (2) (2) (1) Appraised assets 1. Land Building and improvements Medical equipment Total value of appraised assets /2/ Less: Deferred tax liabilities (47.19) 3/ Total adjustment to shareholders equity of SHV Remark: 1/ The appraisal report prepared by Year Appraisal Co., Ltd. No. 2684/2560 dated September 5, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 3012/2560 dated October 2, / CapAd assumed deferred tax liabilities at 20% of the difference between the appraised value and book value of the appraised assets. Thus, CapAd has adjusted the shareholders equity of SHV - net of deferred tax liabilities by Baht million. Capital Advantage Company Limited Page 39/89

40 2.1.3 Paknampo Hospital Company Limited ( PNP ) The appraised assets of PNP are as follows: Property, plant and medical equipment of Paknampo Hospital ( PNP1 ) and Paknampo 2 Hospital ( PNP2 ) 3 units of 3-storey commercial building (currently not in use and is in dilapidated condition) 2-storey townhouse (currently used as document storage and is in dilapidated condition) Vacant land with total area of rai next to Paknampo Hospital (currently not in use) Details are as follows: (1) Property, plant and medical equipment of Paknampo Hospital Paknampo Hospital is located at 96/12 Phahonyothin Road (Highway No.1), Nakhon Sawan Tok Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province, and Paknampo 2 Hospital is located at 62 Attakavee Road, Paknampo Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province. Year Appraisal Co., Ltd. ( Independent Property Appraiser ), an independent property appraiser approved by the SEC, has been appointed by the Company to appraise value of Property, plant and medical equipment of Paknampo Hospital and Paknampo 2 Hospital. The Independent Property Appraiser had surveyed the assets and conducted the appraisal on August 11, 2017 and September 16, 2017, with the public purpose, based on the report dated September 12, 2017 (No. 2783/2560) and October 2, 2017 (No. 3013/2560), respectively. The Independent Property Appraiser applied the Cost Approach for the valuation of the appraised assets as it viewed that the Income Approach may not reflect the highest and best use value of the appraised assets 10 due to some hospital buildings are under construction. Details of the appraisal are as follow: a. Land Forty plots of land with total areas of rai (5, sq.wah) has been used for construction of Paknampo Hospital and Paknampo 2 Hospital. Paknampo Hospital: consisted of 33 plots of land with total areas of rai (3, sq.wah). The lands were divided into 2 groups as follows; Land Group 1: 28 plots of land with total areas of rai (2,192.4 sq.wah) has been used for construction of Paknampo Hospital. Land Group 2: 5 plots of land with total areas of rai (1,143 sq.wah) has been used for construction of kitchen and parking area of Paknampo Hospital. Details of land are as follows: No. Land title deed No. Land No. Survey page Land area as per title deed Owner Rai Ngan Sq.wah Land Group Paknampo Hospital Company Limited Encumbrance Thanachart Bank PCL. 10 The IFA agreed with the use of the Cost Approach in valuation of PNP s assets. In valuation under the Income Approach, the Independent Property Appraiser used information of as base for projection of future net operating income. However, the IFA viewed that such financial performance of as base information may not reflect future cash flow of PNP because PNP1 and PNP2 were under renovation and construction in Capital Advantage Company Limited Page 40/89

41 No. Land title deed No. Land No. Survey page Land area as per title deed Owner Rai Ngan Sq.wah Total area of Land Group 1 PNP Less Roadway 1/ Total appraised area of Land Group PNP1 1/ Land Group Paknampo Hospital Company Limited Total area of Land Group 2 PNP Encumbrance Thanachart Bank PCL. Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, Remark: 1/ Since title deed No. 165, and with total area of rai (192.1 sq.wah) was roadway, the Independent Property Appraiser did not evaluate value of such areas. Thus, the remaining appraised areas of Land Group 1 PNP1 was rai (2,000.3 sq.wah). Paknampo 2 Hospital: consisted of 7 plots of land with total areas of rai (1,963 sq.wah). The lands were divided into 2 groups as follows; Land Group 1: 1 plot of land with total areas of rai (1,087 sq.wah) has been used for construction of Paknampo 2 Hospital. Land Group 2: 6 plots of land with total areas of rai (876 sq.wah) has been used for construction of 8-storey parking building. Details of land are as follows: No. Land title deed No. Land No. Survey page Land area as per title deed Owner Encumbrance Rai Ngan Sq.wah Land Group Paknampo Hospital Company Limited Thanachart Bank PCL. Total area of Land Group 1 PNP Group / Paknampo Hospital Thanachart Bank Company Limited PCL Total area of Land Group 2 PNP2 1/ Less Roadway 1/ Total appraised area of Land Group 2 PNP2 1/ Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, Remark: 1/ Since title deed No with total area of rai (288 sq.wah) was roadway (joint ownership with other person), the Independent Property Appraiser did not evaluate value of such areas. Thus, the remaining appraised areas of Land Group 2 PNP2 was rai (588 sq.wah). b. Building and improvement Paknampo Hospital Building and improvement PNP1 Usable areas Physical life (sq.m.) of assets (Year) Located on land title deed No. PNP1 Group storey hospital building (Building A) 2, On 22 plots of land from Land Group storey hospital building (Building AB) 1, n.a. 1/ 3 6-storey hospital building (Building B) 6, n.a. 1/ 4 2-storey engineer building - Interior Capital Advantage Company Limited Page 41/89

42 Building and improvement PNP1 Usable areas Physical life Located on land title deed No. (sq.m.) of assets (Year) - Restroom storey office building - Interior Interior (improvements) Restroom Open area with shed storey central distribution building - Interior Restroom Parking shed No Parking shed No Parking shed No Parking shed No Parking shed No Parking shed No PNP1 Group 2 13 Kitchen On 5 plots of land from Land Group 2 14 Parking shed No Parking shed No Shop Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, Remark: 1/ Building AB and Building B are under construction with completion of around 80% and 70%, respectively. Paknampo 2 Hospital Building and improvement PNP2 Usable areas Physical life Located on land title deed No. (sq.m.) of assets (Year) PNP2 Group storey hospital building 5, Title deed No storey hospital building Title deed No Interior 7, Lobby PNP2 Group storey parking building 10, Title deed No , 8755 and Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, c. Medical equipment The Independent Property Appraiser revalued 24 items of medical equipment of PNP1 and PNP2 having the book value exceeding Baht 1 million among total 2,349 items of medical equipment. The Independent Property Appraiser found that the appraised assets were in normal condition to serve its purpose with regular maintenance. Evaluation of the appraised assets by the Independent Property Appraiser According to the report dated October 12, 2017 (No. 2783/2560), the Independent Property Appraiser applied the Cost Approach for the valuation of the appraised assets as it viewed that the Income Approach may not reflect the highest and best use value of the appraised assets since some hospital buildings are under construction. Summary of the appraisal are as follows: (1) Cost Approach a. Land Main assumptions of the Independent Property Appraiser By using the Market Approach, the Independent Property Appraiser had conducted survey on market information of assets regarding the selling price of assets at coincide time and in adjacent area which possess similar characteristics to the appraised asset for comparison and analysis. With this regards, there were 6 selected data of vacant land located at nearby areas for comparison with the offering/selling price during Baht 80, ,000 per sq.wah. Then, factors affecting land value including location, shape and size of land, physical characteristics, type, and their potential as well as time consuming were evaluated by applying Weighted Quality Score (WQS). Paknampo Hospital The market value of appraised land from Land Group 1 of PNP1 (totaling 28 plots of land with total areas per title deeds of rai (2,192.4 sq.wah) and the appraised areas of rai Capital Advantage Company Limited Page 42/89

43 (2,000.3 sq.wah)) by the Independent Property Appraiser is equal to Baht 125,000 per sq.wah, or equivalent to total market value of Baht million. The market value of appraised land from Land Group 2 of PNP1 (totaling 5 plots of land with total areas per title deeds and appraised areas of rai (1,143 sq.wah)) by the Independent Property Appraiser is equal to Baht 100,000 per sq.wah, or equivalent to total market value of Baht million. Based on the appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, 2017, by the Market Comparison Approach, total market value of land from Land Group 1 of PNP1 is Baht million, and total market value of land from Land Group 2 of PNP1 is Baht million. Conclusively, the total market value of the lands of PNP1 is equal to Baht million. Paknampo 2 Hospital The market value of appraised land from Land Group 1 of PNP2 (1 plot of land with total areas per title deed and appraised areas of rai (1,087 sq.wah)) by the Independent Property Appraiser is equal to Baht 125,000 per sq.wah, or equivalent to total market value of Baht million. The market value of appraised land from Land Group 2 of PNP2 (totaling 6 plots of land with total areas per title deeds of rai (876 sq.wah) and the appraised areas of rai (588 sq.wah)) by the Independent Property Appraiser is equal to Baht 100,000 per sq.wah, or equivalent to total market value of Baht million Based on the appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, 2017, by the Market Comparison Approach, total market value of land from Land Group 1 of PNP2 is Baht million, and total market value of land from Land Group 2 of PNP2 is Baht million. Conclusively, the total market value of the lands of PNP2 is equal to Baht million. b. Building and improvements Paknampo Hospital Paknampo Hospital Completed Building and improvement Usable areas PNP1 (sq.m.) Unit (Baht per sq.m.) Replacement Cost New Total (Baht million) Physical life (Year) Replacement Cost New Less Depreciation (Baht million) PNP1 Group storey hospital building (Building A) 2, , storey engineer building - Interior , Restroom , storey office building - Interior , Interior (improvements) , Restroom , Open area with shed , storey central distribution building - Interior , Restroom , Parking shed No , Parking shed No , Parking shed No , Parking shed No , Parking shed No , Parking shed No , Total building and improvement of Group 1 of PNP1 - Completed PNP1 Group 2 11 Kitchen , Parking shed No , Parking shed No , Shop , Total building and improvement of Group 2 of PNP1 - Completed 3.20 Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, Capital Advantage Company Limited Page 43/89

44 Paknampo Hospital Under construction Building and improvement Usable areas Replacement Cost New % of PNP1 (sq.m.) Unit Total Completion (Baht per (Baht sq.m.) million) Value at current condition (Baht million) Remaining construction costs (Baht million) PNP1 Group storey hospital building (Building AB) 1, , storey hospital building (Building B) 6, , Total building and improvement of Group 1 of PNP1 Under construction Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, The Independent Property Appraiser appraised the building and improvements by adjusting the construction cost per unit (Baht per sq.m.) as at appraisal date with the depreciation of the appraised assets. Building and improvements with physical life of 2 6 years was depreciated at 2% - 6% and office building with physical life of 28 years was depreciated at 46%. The buildings under construction was adjusted with remaining construction costs. Conclusively, total appraised value of building and improvements of PNP1 under the Cost Approach is equal to Baht million. Paknampo 2 Hospital Building and improvement Usable areas Replacement Cost New Physical PNP2 (sq.m.) Unit (Baht per Total (Baht million) life (Year) Replacement Cost New Less Depreciation (Baht million) sq.m.) PNP2 Group storey hospital building 5, , storey hospital building - Interior 7, , Lobby , Total building and improvement of Group 1 of PNP PNP2 Group storey parking building 10, , Total building and improvement of Group 2 of PNP Total building and improvement of PNP Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, The Independent Property Appraiser appraised the building and improvements by adjusting the construction cost per unit (Baht per sq.m.) as at appraisal date with the depreciation of the appraised assets. Building and improvements with physical life of 1 2 years was depreciated at 1% - 2%. Conclusively, total appraised value of building and improvements of PNP2 under the Cost Approach is equal to Baht million. c. Medical equipment Medical equipment owned by PNP was located at Paknampo Hospital and Paknampo 2 Hospital. The Independent Property Appraiser had surveyed the assets and conducted the appraisal with the public purpose on September 16, 2017, according to the report dated October 2, 2017 (No. 3013/2560). The Independent Property Appraiser applied only the Cost Approach as valuation methodology for medical equipment as there was no information in relation to selling/purchasing of similar assets. The Independent Property Appraiser used the Replacement Cost New adjusted with depreciation of the assets on straight-line basis or other methods suitable for the valuation of medical equipment. Factors affecting depreciation of the appraised assets are (1) physical life (2) physical deterioration (3) functional obsolescence (4) economic or external obsolescence. Details of the valuation of PNP s medical equipment are as follows; Medical equipment - PNP Quantity Physical life Remaining useful life Replacement cost new 1/ Replacement cost new less depreciation (Baht million) (items) (years) (years) (Baht million) Telsa MRI Scanner CT Scanner (128 slices) (PNP2) Medical gas system 8-storey building (PNP2) Medical gas system 6-storey building (PNP2) Mammography EGD+COLONOSCOPY Capital Advantage Company Limited Page 44/89

45 Medical equipment - PNP Quantity Physical life Remaining useful life Replacement cost new 1/ Replacement cost new less depreciation (Baht million) (items) (years) (years) (Baht million) 7 C-arm X-ray unit Model: BV Pulsera Surgical microscope (LC) Medical gas system Pediatric Laryngoscope Aero Rad digital X-ray (Konica Minolta - Aero Rad 68S) 12 Computed Radiography Computed Radiography Semi-automatic vial filing machine Semi-automatic vial filing machine High frequency ultrasound (Affiniti 50) Operating table Ultrasound scanner model HD Anesthesia machine model Advance CS2, GE Healthcare 20 Operating light model Marled V16/V10D Operating light model Marled V16/V10D Bone densitometry Anesthesia machine Ultrasound scanner model HD Total Other medical equipment 2, / Total medical equipment net of depreciation 2, Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 3013/2560, dated October 2, Remark: 1/ Replacement costs of the medical equipment were based on the document from PNP and adjusted with price index of machinery and equipment. 2/ The Independent Property Appraiser did not revalue the medical equipment with the book value less than Baht 1.00 million, totaling 2,325 items, but applied the book value of such assets instead. The IFA is of the same opinion as the Independent Property Appraiser regarding the appropriateness of the valuation methodology applied to the valuation of medical equipment, the Replacement Cost Approach, because the assets were constructed with special characteristic and economic uses. Then, the replacement cost was adjusted to reflect current conditions of the assets and economic obsolescence. Based on the appraisal report prepared by the Independent Property Appraiser No. 3013/2560 dated October 2, 2017 by the Replacement Cost Approach and the book value of assets, the value of the medical equipment of PNP is equal to Baht million. (2) Income Approach verification method This approach is applied to income generating assets by assuming that value of assets is equal to present value of expected cash flow to be generated by such assets in the future. Annual income from the assets is calculated and then discounted to present value. In preparation of revenue and expense projection, the Independent Property Appraiser assumed base revenues and expenses from historical performance of the year and adjusted with average inflation rate of 2.30% per annum to arrive the operating cash flows of the year 1 st 11 th. Assumptions for the valuation are as follows; PNP Amount 1 Business type General hospital 2 Registered bed PNP1 : 100 beds PNP2 : 100 beds 3 Revenue from medical services - OPD Average OPD 309 cases per day Average OPD revenue Baht 1,270 per case - IPD Average IPD 40 cases per day Average IPD revenue Baht 19,630 per day 4 Other incomes 1% of revenue from medical services 5 Cost of medical services 70% of revenue from medical services 6 Selling and administrative expenses 15% of total revenues 7 Inflation rate Average 2.30% per annum 8 Projection period 10 years and Year 11 for estimation of terminal value 9 Cost of asset disposal 2% of selling price of assets 10 Terminal Cap Rate 7.90% per annum 11 Cost of equity 13.40% per annum 1/ 12 Cost of debts 6.50% per annum 13 D/E ratios 0.98 times Capital Advantage Company Limited Page 45/89

46 PNP Amount 14 Discount rate 10.73% per annum 15 Present value of cash flow Baht 843,700,000 (rounding) Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, Remark: The Independent Property Appraiser considered the historical performance of PNP for the year as a base price. 1/ The Independent Property Appraiser assumed the return on investment in 10-year government bond as of July 27, 2017 at 2.55% per annum, and added Equity Country Risk Premium x Beta and adjusted with risk premium for hospital business around 1% per annum. Based on above assumptions, the appraisal price of assets of PNP1 and PNP2 derived from the Income Approach by the Independent Property Appraiser is equal to Baht million. PNP1 Land Summary of the appraisal price of the assets of PNP1 and PNP2 (Unit: Baht million) PNP Assets Appraisal price by the Independent Property Appraiser Cost Approach Income Approach 33 plots of land with total areas of rai (3, sq.wah.) Building and improvement - 4-storey hospital building (Building A) - 6-storey hospital building (Building AB) - 6-storey hospital building (Building B) - 2-storey engineer building - 2-storey office building - Central distribution building - 9 Parking shed PNP2 Land plots of land with total areas of rai (1,963 sq.wah.) Building and improvement - 8-storey hospital building - 6-storey hospital building - 8-storey parking building Total land and building and improvement of PNP1 and PNP2 1, / PNP1 and PNP2 Medical equipment / Total land, building and medical equipment of PNP1 and PNP2 1, / Remark: 1/ Rounding 2/ The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 3013/2560 dated October 2, The Independent Property Appraiser viewed that the Income Approach may not reflect the highest and best use value of the appraised assets as some hospital buildings are under construction. In the Income Approach, the Independent Property Appraiser used information of as base for projection of future net operating income. However, the IFA viewed that such financial performance of as base information may not reflect future cash flow of PNP because PNP1 and PNP2 were under renovation and construction in Therefore, the Independent Property Appraiser applied the Cost Approach for the valuation of the appraised assets. Thus, the Independent Property Appraiser viewed that appraised value of assets which are land, building, and medical equipment of PNP1 and PNP2 is equal to Baht 1, million. The IFA s opinion regarding the asset appraisal by the Independent Property Appraiser CapAd is of the opinion that the asset appraisal of PNP1 and PNP2 by the Cost Approach is appropriate because some buildings are under construction. Besides, the appraised value derived from the Income Approach apply base revenues and expenses from historical performance of the year without considering its future profitability from the assets under construction. Therefore, the Income Approach may not reflect the highest and best use value of the appraised assets. Conclusively, the appraisal value of land, building and medical equipment of PNP1 and PNP2 by the Independent Property Appraiser is equal to Baht 1, million. (2) Land with 3 units of 3-storey commercial building - PNP 3 units of 3-storey commercial building are located at 301/17-18 and 301/19 Sawanvitee Road, Paknampo Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province. Capital Advantage Company Limited Page 46/89

47 The Independent Property Appraiser had surveyed the assets and conducted the appraisal on August 11, 2017, with the public purpose, based on the report dated September 13, 2017 (No. 2984/2560). The Independent Property Appraiser applied the Market Approach and the Cost Approach for the valuation of the appraised assets. Details are as follows: a. Land 5 plots of land with total areas of rai ( sq.wah.) where 2 adjacent units of 3- storey commercial building and 1 unit of commercial building are located. Details of the appraised land are as follow: No. Land title Land Survey Land area as per title deed Owner Encumbrance deed No. No. page Rai Ngan Sq.wah Group 1: 2 adjacent units of 3-storey commercial building Paknampo Hospital -None Company Limited Total land areas of Group Group 2: 1 unit of 3-storey commercial building Paknampo Hospital -None Company Limited Total land areas of Group Total land areas of Group Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2984/2560 dated September 13, b. Building and improvement Building and improvement PNP Usable areas (sq.m.) Physical life of assets (Year) Located on land title deed No. Title deed No and Group adjacent units of 3-storey commercial building 1/ - Interior Terrace Group 2 2/ 2 1 unit of 3-storey commercial building 1/ Title deed No Interior Terrace Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2984/2560 dated September 13, Remark: 1/ The commercial buildings are lack of maintenance (abandon). 2/ As of the appraisal date, there were a 3-storey commercial building, 3 units of 2-storey houses for workers, and a unit of 1-storey storage building located on land. However, the Independent Property Appraiser did not revalue 3 units of 2-storey houses (for workers) and a unit of 1-storey storage building as the assets were damaged without maintenance. In addition, PNP informed that such buildings would be demolished in the future. Valuation of the appraised assets by the Independent Property Appraiser The Independent Property Appraiser applied the Market Approach for the valuation of Group 1 (2 adjacent units of 3-storey commercial building) as there were sufficient comparable data, and used the Cost Approach for the valuation of Group 2 (a 3-storey commercial building) as the value of land and building could be estimated separately and combined to reach the appraisal value of the asset. Group 1 (2 adjacent units of 3-storey commercial building - PNP) The Independent Property Appraiser applied the Market Approach for the valuation of 2 adjacent units of 3-storey commercial buildings as follows: By using the Market Approach, the Independent Property Appraiser had conducted survey on market information of assets regarding the selling price of assets at coincide time and in adjacent area which possess similar characteristics as the appraised asset for comparison and analysis. With this regards, there were 4 selected data of commercial buildings on Sawanvitee Road and Phahonyothin Road for comparison with the offering/selling price during Baht million. Then, factors affecting the assets value including location, shape and size of assets, physical characteristics, type, and their potential as well as time consuming were evaluated by applying Weighted Quality Score (WQS). The market value of 2 adjacent units of 3-storey commercial building of PNP determined by the Independent Property Appraiser is equal to Baht 4.50 million per unit, or equivalent to total market value of Baht 9.00 million. Capital Advantage Company Limited Page 47/89

48 The IFA is of the same opinion as the Independent Property Appraiser regarding the appropriateness of data for comparison because it represents the market data of commercial buildings with the available market price of land sold/offered for sale at current situation and located in adjacent area to the appraised assets. In addition, the Independent Property Appraiser has adjusted the market data of comparable commercial buildings to make them mostly similar to 2 adjacent units of 3-storey commercial buildings PNP in order to closely reflect the fair market value. Based on the appraisal report prepared Year Appraisal Co., Ltd. No. 2984/2560 dated September 13, 2017 by the Market Approach, the total market value of 2 adjacent units of 3-storey commercial buildings of PNP is equal to Baht 9.00 million. Group 2 (a 3-storey commercial building - PNP) The Independent Property Appraiser applied the Cost Approach for the valuation of a 3-storey commercial building due to the asset was old and lack of maintenance. The Independent Property Appraiser did not determine value of other assets in this group, namely, 3 units of 2-storey house (for workers) and 1-storey storage building, which were damaged and lack of maintenance. In addition, PNP informed that such buildings would be demolished in the future. Summary of the appraisal are as follows: Land: Group 2 (Land with a 3-storey commercial building) By using the Market Approach, the Independent Property Appraiser had conducted survey on market information of assets regarding the selling price of assets at coincide time and in adjacent area which possess similar characteristics as the appraised land for comparison and analysis. With this regards, there were 6 selected data of land on Matulee Road, Daowdung Road, Phan Ploy Road and unknown road for comparison with the offering/selling price during Baht 80, ,000 per sq.wah. Then, factors affecting land value including location, shape and size of assets, physical characteristics, type, and their potential as well as time consuming were evaluated by applying Weighted Quality Score (WQS). The market value of land in Group 2 determined by the Independent Property Appraiser is equal to Baht 90,000 per sq.wah (appraised area is rai ( sq.wah.)), or equivalent to total market value of Baht million. Building and improvements: Group 2 (Land with a 3-storey commercial building) Building and improvement Usable areas Replacement Cost New Physical life Replacement Cost New Less PNP (sq.m.) Unit Total Depreciation (Baht per (Year) (Baht million) sq.m.) (Baht million) 1 1 unit of 3-storey commercial building - Interior , Terrace , Total value of 1 unit of 3-storey commercial building (rounding) 0.23 Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2984/2560 dated September 13, The Independent Property Appraiser appraised the building and improvements by adjusting the construction cost per unit (Baht per sq.m.) as at appraisal date and deducted with the depreciation of the appraised assets. Building and improvements with physical life of 47 years was depreciated at 76%. Conclusively, total appraised value of a 3-storey commercial building of PNP is equal to Baht 0.23 million. Conclusively, based on the appraisal report prepared Year Appraisal Co., Ltd. No. 2984/2560 dated September 13, 2017 by the Cost Approach, the total appraised value of land and a 3-storey commercial building of PNP is equal to Baht million. Opinion of the IFA on asset appraisal by the Independent Property Appraiser CapAd views that the appraisal of the assets in Group 1 (2 adjacent units of 3-storey commercial buildings) by the Market Approach is appropriate because this method is suitable for valuing properties when sufficient and suitable market data available for comparison. The appraisal of the assets in Group 2 (a 3-storey commercial building) by the Cost Approach is appropriate because the assets were old and lack of maintenance and other buildings and improvements situated behind the 3-storey commercial building were damaged and lack of maintenance. In addition, PNP informed that the other buildings and improvements would be demolished in the future. Therefore, the Independent Property Appraiser evaluated only the land and a 3-storey commercial building. Capital Advantage Company Limited Page 48/89

49 Conclusively, the appraised value of the 2 adjacent units of 3-storey commercial buildings is equal to Baht 9.00 million, and value of land with a 3-storey commercial building is equal to Baht million, or total value of the appraised assets is equal to Baht million. (3) Land with 2-storey townhouse - PNP A 2-storey townhouse is located at 911/34 unnamed Soi of Soi Sawanvitee 46, Sawanvitee Road, Paknampo Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province. The Independent Property Appraiser had surveyed the assets and conducted the appraisal on August 11, 2017, with the public purpose, based on the report dated August 23, 2017 (No. 2501/2560). The Independent Property Appraiser applied the Market Approach for the valuation of the appraised assets. Details are as follows: a. Land One plot of land with total area of rai (16.10 sq.wah) has been used for construction a 2-storey townhouse. Details of the land are as follows: No. Land title Land Survey Land area as per title deed Owner Encumbrance deed No. No. page Rai Ngan Sq.wah Paknampo Hospital -None- Company Limited Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2501/2560 dated August 23, b. Building and improvement Building and improvement PNP Usable areas (sq.m.) Physical life of assets (Year) Located on land title deed No. 1 A2-storey townhouse 1/ Title deed No Interior Kitchen (backyard) Terrace Parking Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2501/2560 dated August 23, Remark: 1/ A 2-storey townhouse was dilapidated and lack of maintenance. Valuation of the appraised assets by the Independent Property Appraiser The Independent Property Appraiser applied the Market Approach for the valuation of the assets due to there is sufficient comparable market data. Assumptions of the Independent Property Appraiser By using the Market Approach, the Independent Property Appraiser had conducted survey on market information of assets regarding the selling price of assets at coincide time and in adjacent area which possess similar characteristics as the appraised asset for comparison and analysis. With this regards, there were 4 selected data of townhouse located in nearby areas with the offering/selling price during Baht million. Then, factors affecting assets value including location, shape and size of assets, physical characteristics, type, and their potential as well as time consuming were evaluated by applying Weighted Quality Score (WQS). The market value of a 2-storey townhouse of PNP determined by the Independent Property Appraiser is equal to Baht 0.90 million. The IFA is of the same opinion as the Independent Property Appraiser regarding the appropriateness of data for comparison due to it represents the market data of townhouse with the available market price of land sold/offered for sale at current situation and located in adjacent area to the appraised assets. In addition, the Independent Property Appraiser has adjusted the market data of comparable townhouses to make them mostly similar to a 2-storey townhouse of PNP in order to closely reflect the fair market value. Based on the appraisal report prepared Year Appraisal Co., Ltd. No. 2501/2560 dated August 23, 2017 by the Market Approach, the total market value a 2-storey townhouse of PNP is equal to Baht 0.90 million. (4) Vacant land rai next to PNP1 On September 8, 2017, PNP purchased 4 plots of land with total areas of rai ( sq.wah) at price of Baht 72 million. The lands are situated Soi Sawanvitee 24, Sawanvitee Road, Paknampo Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province. (Next to PNP1). The Independent Property Appraiser had surveyed the assets and conducted the appraisal on September 11, 2017, with the public purpose, based on the report dated September 13, 2017 (No. Capital Advantage Company Limited Page 49/89

50 2803/2560). The Independent Property Appraiser applied the Market Approach for the valuation of the appraised assets. Details are as follows: No. Land title Land Survey Land area as per title deed Owner Encumbrance deed No. No. page Rai Ngan Sq.wah / Paknampo Hospital -None Company Limited Source: The appraisal report prepared by Year Appraisal Co., Ltd. No. 2803/2560 dated September 13, Remark: 1/ Some parts of the lands was under servitude to other lands, totaling rai. Hence, remaining appraised areas was equal to rai ( sq.wah). Valuation of the appraised assets by the Independent Property Appraiser By using the Market Approach, the Independent Property Appraiser had conducted survey on market information of assets regarding the selling price of assets at coincide time and in adjacent area which possess similar characteristics as the appraised asset for comparison and analysis. With this regards, there were 6 selected data of vacant lands on Matulee Road, Daowdung Road, Phan Ploy Road and unknown road with the offering/selling price during Baht 80, ,000 per sq.wah. Then, factors affecting land value including location, shape and size of assets, physical characteristics, type, and their potential as well as time consuming were evaluated by applying Weighted Quality Score (WQS). The market value of the vacant land of PNP determined by the Independent Property Appraiser is equal to Baht 100,000 per sq.wah, or total market value of Baht million. Summary of the book value and the appraised value by the Independent Property Appraiser From comparison of the book value of PNP s assets and the appraised value by the Independent Property Appraiser, it is found that the appraised value is higher than the book value as at June 30, 2017, which was the closest date to the appraisal date. Details are as follows: (Unit: Baht million) PP&E of PNP Book value as of June 30, 2017 Appraised Value by the Independent Property Appraiser Appraised Value Higher (Lower) Than Book Value (1) (2) (3) = (2) (1) Appraised assets 1. Land PNP 1 and PNP / Building and improvements and building under / (179.67) construction 3. Medical equipment / (0.18) 4. Land with 3 units of 3-storey commercial / 2.68 building 5. 2-storey townhouse / Land next to PNP / / (14.56) Total value of appraised assets 1, , Less: Deferred tax liabilities (6.71) 7/ Total adjustment to shareholders equity of PNP Remark: 1/ The appraisal report prepared by Year Appraisal Co., Ltd. No. 2783/2560 dated September 12, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 3013/2560 dated October 2, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 2984/2560 dated September 13, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 2501/2560 dated August 23, / The appraisal report prepared by Year Appraisal Co., Ltd. No. 2803/2560 dated September 13, / Transaction after June 30, 2017: On September 8, 2017, PNP purchased 4 plots of land (next to PNP1) with total areas of rai ( sq.wah) at price of Baht 72 million. The lands are situated Soi Sawanvitee 24, Sawanvitee Road, Paknampo Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province. 7/ CapAd assumed deferred tax liabilities at 20% of the difference between the appraised value and book value of the appraised assets, and deferred tax assets at 20% of the difference between the appraised value and book value of the appraised assets (excluding loss from revaluation of land based on conservative basis). 11 [ (179.67) + (0.18) ] x 20% = 6.71 Thus, CapAd has adjusted the shareholders equity of PNP - net of deferred tax liabilities by Baht million. 11 Please see Footnote 9. Capital Advantage Company Limited Page 50/89

51 2.1.4 Pitsanuvej Pattana Company Limited ( PPC ) PPC is a subsidiary of PSV. It was founded on September 15, On September 27, 2017, PPC purchased 6 plots of land with total areas of rai ( sq.wah). The lands are situated opposite to Pitsanuvej Hospital on Khun Pirenthorathep Road, Nai Muang Sub-district, Muang Pitsanuloke District, Pitsanuloke Province. Details are as follows: No. Land title deed No. Land No. Survey page Land area as per title deed Purchase price Owner Encumbrance Rai Ngan Sq.wah Baht ,030, Pitsanuvej -None ,390, Pattana ,645, Company ,730, Limited ,900, ,070, Total ,765, Remark: 1/ Based on 2 land purchase agreements dated September 27, 2017 with the purchase price of Baht 85,000 per sq.wah. As of the date of this report, the Company has not arranged the appraisal of these lands of PPC due to the purchase of these lands was completed on September 27, Therefore, CapAd could not evaluate the market price of such lands derived from the revaluation of an independent property appraiser. However, for information to the shareholders of the Company, CapAd compared the purchase price of these lands to the market price of lands where Pitsanuvej Hospital situated on, which was opposite to these 6 plots of land. Based on the appraisal report prepared by Year Appraisal Co., Ltd. No. 2706/2560 dated September 6, 2017, the market price of land of the Pitsanuvej Hospital derived from the market comparison approach was Baht 50,000 per sq.wah for Land Group 1 (adjacent to Khun Pirenthorathep Road) and Baht 45,000 per sq.wah for Land Group 2 (adjacent to public road behind the Pitsanuvej Hospital). CapAd viewed that these 6 plots of land should compare to Land Group 1 (adjacent to Khun Pirenthorathep Road) with the market price of Baht 50,000 per sq.wah. Therefore, the estimated market price of these 6 plots of land with total areas of around rai ( sq.wah) is equivalent to Baht million. The actual market price of these 6 plots of land derived from the revaluation of an independent property appraiser may differ from the estimated market price by CapAd this time, which was reference to the appraisal report of Pitsanuvej Hospital located opposite to these 6 plots of land. From comparison of the estimated market price of lands and the purchase price of lands, details are as follows: (Unit: Baht million) PP&E of PPC Purchase price of land Estimated market price of land Estimated market price higher (lower) than purchase price (1) (2) (3) = (2) (1) 6 plots of land / (28.32) Total value of appraised assets (28.32) Less: Deferred tax liabilities - 2/ Total adjustment to shareholders equity of PPC (28.32) Remark: 1/ Excluding transaction expenses of approximately Baht 2 million (such as commission, transfer fee and stamp duty). 2/ CapAd assumed deferred tax liabilities at 20% of the difference between the appraised value and book value of the appraised assets, and deferred tax assets at 20% of the difference between the appraised value and book value of the appraised assets (excluding loss from revaluation of land based on conservative basis). 12 Thus, CapAd has adjusted the shareholders equity of PPC from the difference between the estimated market price and the purchase price of land by Baht million. 12 Please see Footnote 9. Capital Advantage Company Limited Page 51/89

52 2.2 Event after the financial report (a) Dividend payment of PSV PSV The 2017 Annual General Meeting of Shareholders of PSV, held on April 27, 2017, resolved to approve the dividend payments from the net profit of 2016 at the rate of Baht 480 per share, totaling Baht million. The dividend payment to the shareholders was made in May Therefore, CapAd has lowered the shareholders equity of PSV as a result of the dividend payment by Baht million. AMA AMA holds 60% of registered and paid-up capital of PSV, and had a right to receive Baht million dividend form PSV. Therefore, CapAd has increased the shareholders equity of AMA as a result of the dividend receivable by Baht million. (b) Dividend payment of SHV The 2017 Annual General Meeting of Shareholders of SHV, resolved to approve the dividend payments of Baht million. (At the present, SHV has not yet distributed the dividend to shareholders.) Therefore, CapAd has lowered the shareholders equity of SHV as a result of the dividend payment by Baht million, and increased the shareholders equity of PSV from the dividend receivable by Baht million. (c) Increase of registered and paid-up capital of PNP PNP The 2017 Annual General Meeting of Shareholders of PNP, held on April 26, 2017, resolved to approve the increase of registered capital from 1,770,830 shares to 3,541,660 shares by issuing the right offering of 1,770,830 new ordinary shares at par value of Baht 100 each at the ratio of 1 exiting share to 1 new share at the offering price of Baht per share. In June 2017, PNP received the capital increase from its existing shareholders in total of Baht million, and registered the capital increase to the Ministry of Commerce in August Therefore, CapAd has adjusted the shareholders equity of PNP from the capital increase by Baht million. AMA In June 2017, AMA, as an existing shareholder of PNP, subscribed 1,631,583 shares of PNP at the par value of Baht 100 each. Subscription price of share equal to Baht 250 per share, or equivalent to total price of newly issued ordinary shares of PNY of Baht million. In addition, on August 28, 2017, AMA purchased 66,218 shares of PNP from an existing shareholder of PNP at the purchase price of Baht 250 per share, totaling Baht million. Therefore, shareholding percentage of AMA in PNP has increased to 90.92% of the registered and paid up capital of PNP. Therefore, CapAd has lowered the net assets of AMA by Baht million. (d) Establishment of Pitsanuvej Pattana Company Limited (PPC) PPC was founded on September 15, 2017 with registered capital of Baht 1,000,000 divided into 100,000 ordinary shares at par value of Baht 10 each. PSV owns % of PPC. On September 27, 2017, PPC purchased 6 plots of land with total areas of rai ( sq.wah) at the purchase price Baht 85,000 per sq.wah in totaling of Baht million and transaction expenses of approximately Baht 2 million (such as commission, transfer fee and stamp duty). Total cost of land was approximately Baht million while source of fund from loans from PSV. However, investment in PPC and loan to PPC are considered related transactions between PSV and PPC, a subsidiary of PSV, where these transactions will be eliminated in preparation of consolidated financial statement. Therefore, CapAd has not adjusted these transactions. 2.3 Tax shield from tax losses carried forward PNP has tax losses carried forward from tax losses of 2016 totaling of Baht million, or equivalent to tax shield of around Baht 5.64 million of which will expire by CapAd expected that the tax losses of around Baht million would be utilized or equivalent to the tax shield of around Baht 4.27 million (Please see the financial forecast of PNP in Part 3 Clause 5 of this report.) Capital Advantage Company Limited Page 52/89

53 Therefore, CapAd has increased the shareholders equity of PNP from tax shield by Baht 4.27 million. Summary of adjustment to book value of AMA According to the aforementioned adjustments, CapAd has evaluated value of AMA based on the Adjusted Book Value Approach which can be summarized as follows: (Unit: Baht million) AMA PSV SHV PNP PNPH PPC Consolidated Net Asset Value as of 2, / / / / / - 4, December 31, 2016 Adjustment of Related Party Transactions Trade and other payables - (0.10) (0.10) Investment in subsidiary (2,723.66) 2/ (331.00) 3/ - (37.50) 4/ - - (3,092.16) Loan to related company (35.48) 5/ - (35.48) Loan from related company / Shareholders Equity (9.12) , After Adjustment of Related Party Transaction Adjustment Increase (decrease) in the - 1, (28.32) 1, value of fixed assets 6/ Dividend payment of PSV 7/ (60.00) (24.00) Dividend payment of SHV 8/ (11.00) Capital increase 9/ (424.45) Tax shield from tax loss carried forward Shareholders Equity after (397.57) 1, , (28.32) 2, Adjustments % shareholding of Non- 0% 40.00% 40.00% 9.08% 9.08% 40.00% Controlling Interests Less Non-Controlling - (597.13) (122.17) (103.59) (0.18) (811.74) Interests Equity Attributable to (397.57) , (16.99) 1, Equity Holders of Parent Firm Value of AMA 1, No. of paid-up shares / (million shares) as of December 31, 2016 Adjusted book value / (Baht/share) Remark: 1/ Based on the financial statements of each company as of December 31, 2016 audited by a certified auditor. 2/ Book value of investment in PSV and PNP as of December 31, / Book value of investment in SHV as of December 31, / Book value of investment in PNPH as of December 31, / Book value of loan to related company and accrued interest between PNP and PNPH as of December 31, / Please see more details in Part 3 Clause 2.1 of this report. 7/ Please see more details in Part 3 Clause 2.2 (a) of this report. 8/ Please see more details in Part 3 Clause 2.2 (b) of this report. 9/ Please see more details in Part 3 Clause 2.2 (c) of this report. 10/ Consist of 1,372,000 preferred shares and 267,003,000 ordinary shares at par value of Baht per share according to pro-forma financial statement of AMA as of December 31, Preferred shares of AMA are entitled to receive dividend at the rate of 4 times over the dividend paid to the ordinary shareholders in the year that a dividend is declared. Upon dissolution of AMA, the preferred shareholders are entitled to the return of paid-up capital and the premium on preferred shares from liquidation of the remaining assets of AMA in preference to the common shareholders. If there is remaining capital after the ordinary shareholders receive the paid-up amount of each ordinary share, the preferred shareholders are entitled to 4/5 of the remaining capital and the ordinary shareholders are entitled to the remaining amount after the preferred shareholders. However, in this Transaction, the Company will acquire % of registered and paid-up capital of AMA. CapAd, therefore, shall consider fair value of ordinary shares and preferred shares on the same basis and shall not consider term and conditions of the preferred shares. 11/ Excluding PUH, a subsidiary of PSV, which was found on June 2, 2017 with the registered capital of Baht 1,000,000. PUH has no business operation at the present. The value of AMA s shares based on this approach is equal to Baht 6.35 per share 13 and the firm value of AMA is equal to Baht 1, million. 13 Please see Footnote 8. Capital Advantage Company Limited Page 53/89

54 3. Price to Book Value Ratio Approach: P/BV Ratio In this approach, CapAd evaluated AMA s shares by using book value per share of AMA as shown in AMA s pro-forma financial statements 14 as of December 31, 2016, prepared by the management of the Company under consultation with the Company s auditor, which was equivalent to Baht per share, and multiplied by the median of P/BV Ratios of 20 comparable SET- or MAIlisted companies 15 in health care services sector, services industry who operate private hospital business similar to AMA, a holding company invested in private hospitals. The information is for the period up to September 29, The details are summarized below: AMA Sym Historical P/BV Ratio (time) bol 7 days 15 days 30 days 60 days 90 days 120 days 180 days 360 days Aikchol Hospital PCL. AHC Bangkok Chain Hospital PCL. BCH Bangkok Dusit Medical BDMS Services PCL. Bumrungrad Hospital PCL. BH Chularat Hospital PCL. CHG Chiang Mai Ram Medical CMR Business PCL. Ekachai Medical Care PCL. EKH Thonburi Medical Centre KDH PCL. Ladprao General Hospital PCL. LPH Mahachai Hospital PCL. M-CHAI Wattana Karnpaet PCL. NEW Nonthavej Hospital PCL. NTV Ramkhamhaeng Hospital RAM PCL. Rajthanee Hospital PCL. 1/ RJH Ratchaphruek Hospital PCL. 1/ RPH Sikarin PCL. SKR Samitivej PCL. SVH Thai Nakarin Hospital PCL. TNH Vibhavadi Medical Center PCL. VIBHA Srivichaivejvivat PCL. VIH Median of 17 companies 1/ AMA s share value 2/ (Baht/share) AMA s firm value (Baht million) 13, , , , , , , , Source: SETSMART Remark: As of our report preparation date (September 29, 2017), Wattanapat Hospital Trang PCL. (WPH) had not yet listed on the SET. (WPH was listed on October 3, 2017.) 1/ Excluding the companies have been listed on the SET less than 1 year, namely Ekachai Medical Care PCL. (EKH), Rajthanee Hospital PCL. (RJH), and Ratchaphruek Hospital PCL. (RPH). The value of AMA s shares based on this approach is equal to Baht per share 16 and the firm value of AMA is equal to Baht 13, , million. (If applied the financial statement of AMA for the year ended December 31, 2016 (Company Only), audited by a certified auditor, the value of AMA s shares based on this approach is equal to Baht per share and the firm value AMA is equal to Baht 12, , million.) 14 Please see Footnote The IFA has selected 20 listed companies that operate hospital business regardless of size of company in order to have adequate reference group as benchmark of private hospital industry. 16 Please see Footnote 8. Capital Advantage Company Limited Page 54/89

55 4. Price to Earnings Ratio Approach: P/E Ratio In this approach, CapAd evaluated share value of AMA by multiplying earnings per share of AMA as stated in AMA s unaudited or unreviewed pro-forma financial statements as of December 31, , prepared by the management of the Company under consultation with the Company s auditor, by the median of P/E Ratio of 20 comparable SET- or MAI-listed companies 18 in health care services sector, services industry who operate private hospital business similar to AMA, a holding company invested in private hospitals. The information is for the period up to September 29, The details are summarized below: AMA Sym Historical P/E Ratio (time) bol 7 days 15 days 30 days 60 days 90 days 120 days 180 days 360 days Aikchol Hospital PCL. AHC Bangkok Chain Hospital PCL. BCH Bangkok Dusit Medical BDMS Services PCL. Bumrungrad Hospital PCL. BH Chularat Hospital PCL. CHG Chiang Mai Ram Medical CMR Business PCL. Ekachai Medical Care PCL. 1/ EKH Thonburi Medical Centre KDH n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. PCL. 1/ Ladprao General Hospital PCL. LPH Mahachai Hospital PCL. M-CHAI Wattana Karnpaet PCL. NEW Nonthavej Hospital PCL. NTV Ramkhamhaeng Hospital RAM PCL. Rajthanee Hospital PCL. 1/ RJH Ratchaphruek Hospital PCL. 1/ RPH Sikarin PCL. SKR Samitivej PCL. SVH Thai Nakarin Hospital PCL. TNH Vibhavadi Medical Center PCL. VIBHA Srivichaivejvivat PCL. VIH Median of 16 companies 1/ AMA s share value 2/ (Baht/share) AMA s firm value (Baht million) 2, , , , , , , , Source: SETSMART Remark: As of our report preparation date (September 29, 2017), Wattanapat Hospital Trang PCL. (WPH) had not yet listed on the SET. (WPH was listed on October 3, 2017.) 1/ Excluding the companies have been listed on the SET less than 1 year, namely Ekachai Medical Care PCL., Rajthanee Hospital PCL., and Ratchaphruek Hospital PCL., and Thonburi Medical Centre PCL. who had negative earnings and unable to calculate P/E ratio. The value of AMA s shares based on this approach is equal to Baht per share 19 and the firm value of AMA is equal to Baht 2, , million. (If applied the financial statement of AMA for the year ended December 31, 2016 (Company Only), audited by a certified auditor, the value of AMA s shares could not be calculated due to AMA operated at loss in 2016.) 17 Please see Footnote Please see Footnote Please see Footnote 8. Capital Advantage Company Limited Page 55/89

56 5. Discounted Cash Flow Approach AMA is a holding company, currently holding shares directly in two subsidiaries and indirectly in four subsidiaries operating hospital business, as follows: Company AMA s shareholding Business at the present No. of registered beds 1) Pitsanuloke Medical Company Limited ( PSV ) 60.00% Pitsanuvej Hospital 150 beds 2) Union Pichit Doctors Company Limited 99.99% held through PSV Sahavej Hospital 90 beds ( SHV ) 3) Pitsanuvej Uttaradit Hospital Company 99.99% held through PSV No business operation - Limited ( PUH ) 4) Pitsanuvej Pattana Company Limited ( PPC ) 99.99% held through PSV No business operation - 5) Paknampo Hospital Company Limited ( PNP ) 90.92% Paknampo Hospital 200 beds Paknampo 2 Hospital 6) P.N.P Hospital Company Limited ( PNPH ) 99.99% held through PNP No business operation - In this valuation approach, CapAd determined share value of AMA by estimating cash flows from operation of each company that AMA invested in, namely, PSV, SHV and PNP (excluding PUH, PPC, and PNPH who have no business operation at the present). This valuation approach takes into account AMA, PSV, SHV, and PNP s future operating performances by deriving present value of future cash flow streams using an appropriate discount rate. The Independent Financial Advisor calculated the Weighted Average Cost of Capital (WACC) to be used as the discount rate and constructed a 10-year forecast of AMA PSV, SHV and PNP s cash flow ( ) based on an assumption that AMA, PSV, SHV and PNP s operation is on a going concern basis without any significant changes under the current economic conditions and circumstances. In addition, CapAd did not take effects from this transaction into consideration. CapAd constructed financial forecast for AMA, PSV, SHV, and PNP based on information and assumptions from AMA, PSV, SHV, and PNP and interviews with the managements and relevant officers. The objective of the financial forecast is to evaluate the fair value of AMA s shares. If there is any change in overall economic outlook and other internal and external factors that materially affect AMA, PSV, SHV, and PNP s business operation or assumptions used herein, fair value derived from the financial projection may change accordingly. 5.1 Pitsanuloke Medical Company Limited ( PSV ) Pitsanuloke Medical Company Limited (PSV) operates Pitsanuvej Hospital, the first private hospital in the lower northern region of Thailand. The hospital is located in Muang Pitsanuloke District, Pitsanuloke Province. Pitsanuvej Hospital was opened in 1982 with 50 registered beds. In 1995, with higher potential, the hospital increases its capacity to 150 registered beds. In 2012, the hospital became the Joint Commission International (JCI) accredited hospital. Up until now, the hospital has been operating for 35 years. Pitsanuvej Hospital provides upper secondary care with various medical services, namely Internal Medicine Clinic, Pediatrics Clinic, Obstetrics and Gynecology Clinic, Surgical Clinic, Health Check-up Center, Psychiatric Clinic, Children and Adolescents Development Center, Eye Clinic, Ear, Nose and Throat Clinic, Dental Center and other services such as Radiology, Heart, Laboratory and Surgical examination. The assumptions for PSV s financial forecast can be summarized as follows: Revenue from medical services Major revenues of Pitsanuvej Hospital derived from revenue from in-patient-department (IPD) and out-patient-department (OPD) at the rate of 60% to 40% respectively. In , revenues from medical services were Baht million, Baht million, and Baht 1, million, respectively, or increased by 14.85%, 6.22% and 14.01% from the prior year, respectively, resulting from increasing in number of patients and average revenue per patient. Main assumptions are as follow: PSV Unit 2014A 2015A 1/ 2016A 1H2017A 2/ 2017F 2018F 2019F No. of days days Utilization Rate OPD % % 83.62% 88.00% 81.53% 87.27% 90.00% 62.40% 3/ IPD % 85.00% 70.71% 76.26% 59.78% 68.84% 58.97% 3/ 52.44% 3/ OPD No. of OPD patients times/year 220, , ,248 88, , , ,984 Capital Advantage Company Limited Page 56/89

57 PSV Unit 2014A 2015A 1/ 2016A 1H2017A 2/ 2017F 2018F 2019F Average daily No. of OPD times/day patients Average OPD revenue Baht/time 1, , , , , , , % growth of daily average No. of % 4.23% % 5.24% -7.35% -0.83% 4.00% 4.00% OPD patients % growth of average OPD % 4.75% 22.99% 2.52% 7.96% 8.86% 5.00% 5.00% revenue IPD No. of admission Patients/year 18,988 18,887 20,879 8,035 18,730 19,316 20,088 Average daily No. of admission Patients/day No. of IPD (beds) 4/ bed/year 49,640 51,263 54,703 21,206 49,251 50,793 52,825 Average IPD beds per day bed/day Conversion ratio % 8.60% 10.31% 10.80% 9.07% 9.80% 9.80% 9.80% (IPD Admission/OPD) Average length of stay days Average IPD revenue Baht/day 10, , , , , , , % growth of average IPD revenue % 15.37% 5.73% 10.31% 15.32% 13.94% 10.00% 5.00% Revenue from OPD Baht mn Revenue from IPD Baht mn Revenue from medical services Baht mn , , , , % growth of revenue from OPD % 9.19% 2.01% 8.19% n.a. 7.66% 8.29% 9.20% % growth of revenue from IPD % 19.06% 9.19% 17.71% n.a. 2.59% 13.44% 9.20% % growth of revenue from medical services % 14.85% 6.22% 14.01% n.a. 4.48% 11.47% 9.20% PSV Unit 2020F 2021F 2022F 2023F 2024F 2025F 2026F No. of days days Utilization Rate OPD % 64.90% 67.49% 70.19% 73.00% 75.92% 78.96% 82.11% IPD % 54.53% 56.72% 58.98% 61.34% 63.80% 66.35% 69.00% OPD No. of OPD patients times/year 213, , , , , , ,745 Average daily No. of OPD times/day patients Average OPD revenue Baht/time 2, , , , , , , % growth of daily average No. of % 4.00% 4.00% 4.00% 4.00% 4.00% 4.00% 4.00% OPD patients % growth of average OPD % 5.00% 5.00% 2.50% 2.50% 2.50% 2.50% 2.50% revenue IPD No. of admission Patients/year 20,949 21,728 22,597 23,501 24,508 25,418 26,435 Average daily No. of admission Patients/day No. of IPD patients (beds) 4/ bed/year 55,088 57,135 59,420 61,797 64,445 66,840 69,514 Average IPD beds per day bed/day Conversion ratio % 9.80% 9.80% 9.80% 9.80% 9.80% 9.80% 9.80% (IPD Admission/OPD) Average length of stay days Average IPD revenue Baht/day 17, , , , , , , % growth of average IPD revenue % 5.00% 5.00% 2.50% 2.50% 2.50% 2.50% 2.50% Revenue from OPD Baht mn Revenue from IPD Baht mn , , , , , , Revenue from medical services Baht mn. 1, , , , , , , % growth of revenue from OPD % 9.50% 8.90% 6.60% 6.60% 6.89% 6.31% 6.60% % growth of revenue from IPD % 9.50% 8.90% 6.60% 6.60% 6.89% 6.31% 6.60% % growth of revenue from medical services % 9.50% 8.90% 6.60% 6.60% 6.89% 6.31% 6.60% Remark: 1/ AMA acquired PSV since September / Internal financial statement of PSV. 3/ PSV has planned to construct a new building to expand its OPD capacity to 900 times per day (from 600 times per day) in 2019, and increase 80 beds for IPD in / No. of IPD patients (beds) = No. of admission x Average length of stay. OPD In , revenue from OPD was Baht million, Baht million and Baht million, respectively, or increased by 9.19%, 2.01% and 8.19% from the prior year, respectively. In addition, revenue from OPD in the first half of 2017 was Baht million, or decreased around 3.57% from the same period of last year. No. of OPD visits No. of OPD visits in were 220,787 times, 183,126 times and 193,248 times, respectively, or equivalent to No. of OPD visits per day of times, times, and Capital Advantage Company Limited Page 57/89

58 times respectively. No. of OPD visits in were lower than those of 2014, due to, in , PSV renovated service areas for IPD and OPD and invested in new medical equipment. In the first half of 2017, No. of OPD visits were 88,541 times or on average of times per day, which was around 3.80% lower than the same period of last year. The management of PSV informed that, normally, No. of patients would increase in the second half of the year, and there was outbreak of influenza in the first quarter of 2016 which led to higher number of OPD patients in Thailand will become ageing society in the near future causing demographic shift of Thai population. This will cause demand for advance medical services. No. of aging population (aged 65 years and above) is growing continuously, especially the population aged 85 years and above. The group of population aged 85 years and above will require more medical services than other groups due to increasing illness and requiring of attention and special care. The National Economic and Social Development Board (NESDB) estimated that population aged 60 years and above will increase from 9.1 million to 10.3 million by (Please see more detail in Industry outlook and competition in private hospital business in Attachment 1 of this report.) Thailand Population aged 60 and over In this financial forecast, CapAd assumed No. of OPD visits in 2017 of 191,118 times (average times per day), based on actual No. of OPD visits in January July 2017 and annualized with the percentage of No. of OPD visits in 7-month period of 2016 to total OPD visits of In , No. of OPD visits per day was assumed to grow by 4% per annum, based on the cumulative average growth of population aged 65 and over in northern of Thailand in of around 3.63% per annum, and the cumulative average growth of population aged 60 and over in northern of Thailand in of around 5.05% per annum. In addition, PSV has planned to construct a new hospital building in This will increase PSV capacity for OPD visits by around 300 times per day (from 600 times to 900 times per day). At present, OPD visits are rather crowded as Pitsanuvej Hospital is a renounce hospital in the lower northern of Thailand providing full services with modern medical equipment and reasonable price. Average OPD revenue per visit In and the first half of 2017, average OPD revenue per visit was Baht 1,643.63, Baht 2,021.43, Baht 2, and Baht 2,237.41, respectively, or increased by 4.75%, 22.99%, 2.52% and 7.96%, respectively. In this financial forecast, CapAd assumed average OPD revenue in 2017 of Baht 2,256.03, which was the average OPD revenue in January July 2017, or increase by approximately 8.86% of the average OPD revenue per visit of In , average OPD revenue per visit was assumed to grow by 5% per annum, based on the average growth of OPD revenue in 2016 and the first half of Then, in , it was assumed that the average OPD revenue per visit increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. IPD In , revenues from IPD were Baht million, Baht million and Baht million, respectively, or increased by 19.06%, 9.19% and 17.71% from the prior year, Capital Advantage Company Limited Page 58/89

59 respectively. An increase in revenues from IPD was mainly due to the increasing number of IPD admission and average revenue per day. In addition, revenue from IPD in the first half of 2017 was Baht million, or decreased around 3.17% from the same period of last year. No. of admission No. of IPD admission in were 18,988 patients, 18,887 patients and 20,879 patients, respectively, or equivalent to average IPD admission of patients per day, patients per day, and patients per day. As a result of renovation of the hospital in , No. of IPD admission was decrease in 2015, and increased in In the first half of 2017, No. of IPD admission was 8,035 patients or patient per day, or decreased by 20.27% from the same period of prior year. The management of PSV informed that, normally, No. of patients would increase in the second half of the year, and there was outbreak of influenza in the first quarter of 2016 which led to higher number of IPD patient in In this financial forecast, CapAd assumed the conversion ratio from OPD to IPD at 9.80% of OPD visit throughout the projection period, which was equivalent to the weight average conversion ratio of PSV in August December 2016 and January July 2017 of which should reflect the current conversion ratio of PSV. In addition, CapAd estimated the average length of stay at 2.63 days, based on the average length of stay in 2016 and the first half of 2017 which was in the range of days. Average IPD revenue per bed per day In and the first half of 2017, average IPD revenue per day was Baht 10,649.38, Baht 11,260.00, Baht 12, and Baht 14,323.14, respectively, or increased by 15.37%, 5.73%, 10.31% and 15.32%, respectively. In this financial forecast, CapAd assumed average IPD revenue per day in 2017 of Baht 14,152.20, which was the average IPD revenue per day in January July 2017, or increase around 13.94% of the average IPD revenue per day of In 2018, the average IPD revenue per day was estimated to increase by 10% per annum, which was close to the percentage growth of average IPD revenue per day in In , average IPD revenue per day was assumed to grow by 5% per annum due to PSV has planned to renovate and increase around 80 IPD rooms and expected to increase room rate and IPD revenue per day at a certain extent. Then, in , it was assumed that the average IPD revenue per day increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. Cost of medical services Cost of medical services consisted of cost of physicians and medical personnel, medicine and medical supplies, outside lab, patient food, cleaning and laundry, cost of cosmetic products for sales and other expense. Details are as follows: (Unit: Baht million) PSV 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Cost of physicians and medical personnel Cost of medicine and medical supplies Depreciation and amortization expenses 2/ Cost of outside lab Cost of patient food Cleaning and laundry Cost of cosmetic products for sales Other costs Total cost of medical services % to revenue from medical services Cost of physicians and medical 35.47% 37.01% 35.92% 38.44% 38.97% 38.97% 37.12% personnel Cost of medicine and medical supplies 22.78% 22.25% 20.72% 20.45% 20.45% 21.00% 21.00% Depreciation and amortization 1.91% 2.07% expenses 2/ Cost of outside lab 1.26% 1.22% 1.24% 1.15% 1.15% 1.19% 1.19% Cost of patient food 3/ 2.71% 2.68% 2.31% 2.20% 2.20% 2.26% 2.26% Cleaning and laundry 0.00% 0.18% 0.51% 0.46% 0.49% 0.49% 0.49% Cost of cosmetic products for sales 4/ % 67.05% 76.86% 77.80% 77.33% 77.33% 77.33% Other costs 2.81% 2.77% 2.38% 2.08% 2.23% 2.23% 2.23% Total cost of medical services 66.62% 67.42% 62.55% 64.29% 64.97% 65.62% 63.77% Capital Advantage Company Limited Page 59/89

60 PSV 2020F 2021F 2022F 2023F 2024F 2025F 2026F Cost of physicians and medical personnel Cost of medicine and medical supplies Depreciation and amortization expenses 2/ Cost of outside lab Cost of patient food Cleaning and laundry Cost of cosmetic products for sales Other costs Total cost of medical services , , , , , , % to revenue from medical services Cost of physicians and medical 37.12% 37.12% 37.12% 37.12% 37.12% 37.12% 37.12% personnel Cost of medicine and medical supplies 21.00% 21.00% 21.00% 21.00% 21.00% 21.00% 21.00% Depreciation and amortization expenses 2/ Cost of outside lab 1.19% 1.19% 1.19% 1.19% 1.19% 1.19% 1.19% Cost of patient food 3/ 2.26% 2.26% 2.26% 2.26% 2.26% 2.26% 2.26% Cleaning and laundry 0.49% 0.49% 0.49% 0.49% 0.49% 0.49% 0.49% Cost of cosmetic products for sales 4/ 77.33% 77.33% 77.33% 77.33% 77.33% 77.33% 77.33% Other costs 2.23% 2.23% 2.23% 2.23% 2.23% 2.23% 2.23% Total cost of medical services 63.77% 63.77% 63.77% 63.77% 63.77% 63.77% 63.77% Remark: 1/ Internal financial statement of PSV. 2/ Since 2016, PSV recognized depreciation and amortization expenses as administrative expenses instead of cost of medical services. 3/ Percentage cost of food to revenue from IPD. 4/ Percentage cost of cosmetic products for sales to revenue from sale of cosmetics. In and the first half of 2017, cost of medical services was Baht million, Baht million, Baht million, and Baht million, respectively, or accounted for 66.62%, 67.42%, 62.55% and 64.29% of revenue from medical services, respectively. Percentage of cost of medical services to revenue from medical services in 2016 decreased from those of due to, in 2016, PSV reclassified depreciation and amortization expenses as selling and administrative expenses instead of cost of medical services. Key assumptions on cost of medical services were as follows: - Cost of physicians and medical personnel in was estimated at 38.97% of revenue from medical services, based on the estimation of PSV. Cost of physicians and medical personnel in was estimated at 37.12% of revenue from medical services, which was equivalent to the average percentage of cost of physicians and medical personnel to revenue from medical services in and the first half of Cost of medicine and medical supplies in 2017 was assumed at 20.45% of revenue from medical services, which was equivalent to those of the first half of Cost of medicine and medical supplies in was assumed at 21.00% of revenue from medical services, which was equivalent to average percentage of cost of medicine and medical supplies to revenue from medical services in 2016 and the first half of 2017 (the period after AMA acquired PSV and have involved in management of Pitsanuvej Hospital). - Cost of outside lab in 2017 was assumed at 1.15% of revenue from medical services, which was equivalent to those of the first half of Cost of outside lab in was assumed at 1.19% of revenue from medical services, which was equivalent to average percentage of cost of outside lab to revenue from medical services in 2016 and the first half of 2017 (the period after AMA acquired PSV and have involved in management of Pitsanuvej Hospital). - Cost of patient food in 2017 was estimated at 2.20% of IPD revenues, which was equivalent to those of the first half of Cost of patient food in was assumed at 2.26% of IPD revenues, which was equivalent to average percentage of cost of patient food to IPD revenues in 2016 and the first half of 2017 (the period after AMA acquired PSV and have involved in management of Pitsanuvej Hospital). - Cost of cleaning and laundry was assumed at 0.49% of revenue from medical services, which was equivalent to average percentage of cost of cleaning and laundry to revenue from medical services in 2016 and the first half of 2017 as PSV started hiring third parties to provide cleaning and laundry services in Cost of cosmetic products for sales (Eucerine and Laroche) was estimated at 77.33% of revenue from sale of cosmetic products throughout the projection period, which was equivalent to average percentage cost of cosmetic products for sales to revenue from sale of cosmetic products in 2016 and the first half of 2017 (around 76.86% % of revenue from sale of cosmetic products). Capital Advantage Company Limited Page 60/89

61 - Other expenses were estimated at 2.23% of revenue from medical services throughout the projection period, which was equivalent to average percentage of other expenses to revenue from medical services in 2016 and the first half of 2017 (the period after AMA acquired PSV and have involved in management of Pitsanuvej Hospital). Other incomes Other incomes consisted of interest incomes, revenue from sale of cosmetic products, dividend receivable, revenue from donation, gain from sale of assets, and other incomes. In and the first half of 2017, other incomes were Baht million, Baht million, Baht million and Baht million, respectively, or accounted for 1.19%, 2.99%, 2.23% and 4.10% of revenue from medical services, respectively. Other incomes in the first half of 2017 were higher than those of due mainly to dividend receivable from SHV of Baht 11 million. Key assumptions on other incomes were as follows: - Revenue from sale of cosmetic products was estimated at 0.42% of revenue from medical services, which was equivalent to average percentage of revenue from sale of cosmetic products to revenue from medical services in (constant 0.42% of revenue from medical services). - Interest income was assumed at 0.09% of revenue from medical services, which was equivalent to average percentage of interest income to revenue from medical services in 2016 and the first half of Revenue from donation was estimated at 0.06% of revenue from medical services, which was equivalent to average percentage of revenue from donation to revenue from medical services in 2016 and the first half of Other incomes were assumed at 1.41% of revenue from medical services, which was equivalent to average percentage of other incomes to revenue from medical services in 2016 and the first half of (Unit: Baht million) PSV 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Revenue from sale of cosmetic products Interest incomes Revenue from donations Gain from sales of assets Revenue from dividend Other incomes Total other incomes % to revenue from medical services Revenue from sale of cosmetic 0.42% 0.42% 0.42% 0.48% 0.42% 0.42% 0.42% products Interest incomes 0.11% 0.30% 0.17% 0.01% 0.09% 0.09% 0.09% Revenue from donations 0.08% 0.16% 0.13% 0.00% 0.06% 0.06% 0.06% Gain from sales of assets 0.00% 0.28% 0.12% 0.00% 0.00% 0.00% 0.00% Revenue from dividend 0.00% 0.00% 0.00% 2.19% 0.98% 0.00% 0.00% Other incomes 0.57% 1.83% 1.40% 1.42% 1.41% 1.41% 1.41% Total other incomes 1.19% 2.99% 2.23% 4.10% 2.96% 1.98% 1.98% PSV 2020F 2021F 2022F 2023F 2024F 2025F 2026F Revenue from sale of cosmetic products Interest incomes Revenue from donations Gain from sales of assets Revenue from dividend Other incomes Total other incomes % to revenue from medical services Revenue from sale of cosmetic 0.42% 0.42% 0.42% 0.42% 0.42% 0.42% 0.42% products Interest incomes 0.09% 0.09% 0.09% 0.09% 0.09% 0.09% 0.09% Revenue from donations 0.06% 0.06% 0.06% 0.06% 0.06% 0.06% 0.06% Gain from sales of assets 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Revenue from dividend 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Other incomes 1.41% 1.41% 1.41% 1.41% 1.41% 1.41% 1.41% Total other incomes 1.98% 1.98% 1.98% 1.98% 1.98% 1.98% 1.98% Remark: 1/ Internal financial statement of PSV Capital Advantage Company Limited Page 61/89

62 Selling and administrative expenses Selling and administrative expenses consisted of employee expenses, repair and maintenance expenses, marketing expenses, rental of medical equipment, office supplies, depreciation and amortization expenses, cleaning expenses, doubtful account, and other expenses. (Unit: Baht million) PSV 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Employee and management expenses Marketing expenses Utility expenses Repair and maintenance expenses Office supplies and stationary Rental fee for medical equipment Consulting and professional fees Cleaning and laundry expenses Depreciation and amortization expenses Other expenses Total selling and administrative expenses % to revenue from medical services Employee and management 13.42% 12.98% 11.79% 8.48% 10.03% 10.03% 10.03% expenses Marketing expenses 0.65% 0.98% 1.20% 1.26% 1.23% 1.23% 1.23% Utility expenses 1.73% 1.74% 1.55% 1.63% 1.59% 1.59% 1.59% Repair and maintenance expenses 3.44% 3.31% 1.75% 1.63% 1.45% 1.60% 1.60% Office supplies and stationary 1.35% 1.24% 0.69% 0.70% 0.62% 0.69% 0.69% Rental fee for medical equipment 0.09% 0.16% 0.23% 0.28% 0.26% 0.26% 0.26% Consulting and professional fees 1.41% 2.29% 1.42% 1.58% 1.50% 1.50% 1.50% Cleaning and laundry expenses 0.10% 0.11% 0.67% 0.90% 0.78% 0.78% 0.78% Depreciation and amortization 1.32% 1.27% 4.49% 6.49% 5.77% 7.42% 9.04% expenses Other expenses 1.65% 2.15% 1.49% 0.92% 1.11% 1.11% 1.11% Total selling and administrative expenses 25.16% 26.24% 25.26% 23.86% 24.33% 26.20% 27.82% % growth of SG&A -0.79% 10.76% 9.78% n.a. 0.62% 20.06% 15.92% PSV 2020F 2021F 2022F 2023F 2024F 2025F 2026F Employee and management expenses Marketing expenses Utility expenses Repair and maintenance expenses Office supplies and stationary Rental fee for medical equipment Consulting and professional fees Cleaning and laundry expenses Depreciation and amortization expenses Other expenses Total selling and administrative expenses % to revenue from medical services Employee and management 9.71% 9.45% 9.39% 9.34% 9.26% 9.24% 9.18% expenses Marketing expenses 1.23% 1.23% 1.23% 1.23% 1.23% 1.23% 1.23% Utility expenses 1.59% 1.59% 1.59% 1.59% 1.59% 1.59% 1.59% Repair and maintenance expenses 1.60% 1.60% 1.60% 1.60% 1.60% 1.60% 1.60% Office supplies and stationary 0.65% 0.61% 0.59% 0.56% 0.54% 0.52% 0.50% Rental fee for medical equipment 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% Consulting and professional fees 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% 1.50% Cleaning and laundry expenses 0.78% 0.78% 0.78% 0.78% 0.78% 0.78% 0.78% Depreciation and amortization 8.42% 6.16% 6.12% 5.86% 5.39% 4.96% 4.52% expenses Other expenses 1.11% 1.11% 1.11% 1.11% 1.11% 1.11% 1.11% Total selling and administrative expenses 26.84% 24.28% 24.17% 23.82% 23.25% 22.78% 22.27% % growth of SG&A 5.66% -1.48% 6.09% 5.09% 4.34% 4.13% 4.23% Remark: 1/ Internal financial statement of PSV In and the first half of 2017, selling and administrative expenses were Baht million, Baht million, Baht million and Baht million, respectively, or accounted for 25.16%, 26.24%, 25.26% and 23.86% of revenue from medical services, respectively. Selling and administrative expenses increased by 10.76% in 2015 due mainly to increase in consulting and professional fee and doubtful accounts. In 2016, selling and administrative expenses Capital Advantage Company Limited Page 62/89

63 increased by 9.78% in 2016 due mainly to allocation of depreciation and administrative expenses to selling and administrative expenses instead of to cost of medical services. Key assumptions on selling and administrative expenses were as follows: - Employee and management expenses in 2017 was equivalent to the annualized of those expenses in the first half of Employee and management expenses in were estimated at 10.03% of revenue from medical services, which was equivalent to percentage of employee and management expenses to revenue from medical services in This is to support business expansion of PSV. In , employee and management expenses were expected to increase by 6% per annum based on PSV s policy. - Marketing expenses were estimated at 1.23% of revenue from medical services, which was equivalent to average percentage of marketing expenses to revenue from medical services in 2016 and the first half of 2017 (around 1.20% % of revenue from medical services). - Repair and maintenance expenses in 2017 were assumed at the annualized of repair and maintenance expenses in the first half of Repair and maintenance expenses in were estimated at 1.60% of revenue from medical services, which was equivalent to average percentage of repair and maintenance expenses to revenue from medical services in Office supply expenses in were estimated at 0.69% of revenue from medical services, which was equivalent to average percentage of office supply expenses to revenue from medical services in 2016 and the first half of In , office supply expenses were assumed to grow by 2.5% based on estimated inflation rate. - Other expenses were assumed at the average percentage of such expenses to revenue from medical services in 2016 and the first half of Financial costs Financial costs consist of interest expenses for short-term loans and long-term loans from financial institution and liabilities under financial lease. According to loan agreements, interest rate of loans from financial institution was at 4% % per annum. In the first half of 2017, a financial institution approved long-term loans of Baht 380 million and short-term loans of Baht 40 million to use for and acquisition of land, renovation of building, and purchase of medical equipment. At the present, PSV has already drawdown some of the loans. In addition, CapAd assumed that in 2018 PSV would require additional loans to support the construction of new hospital building at approximately 60% of construction budget. Corporate income taxes Corporate income tax rate of 20% was assumed throughout projection period. Capital Expenditure Capital expenditure in 2017 was estimated at Baht 300 million, based on the budget of PSV, consisted of purchase of land in Uttaradit of Baht 111 million, purchase of land in Pitsanuloke of Baht 72 million 20, renovation of buildings of around Baht 60 million and the remaining for purchase of medical equipment and other assets. Capital expenditure in 2018 was estimated at Baht 452 million, based on the budget of PSV, consisted of cost of construction of new building and renovation of exiting building, totaling of Baht 373 million, and medical equipment, ambulances and other assets of around Baht 79 million. In , capital expenditures for medical equipment and other assets were assumed at 5% of revenue from medical services. Besides, in , capital expenditures for medical equipment and other assets were assumed at 3% of revenue from medical services, according to PSV s projection based on experience in private hospital operation of management team and equivalent to average capital expenditure of industry at around 3% - 4% of revenue from medical services. Assets and liabilities turnover Based on historical data of and the first half of 2017, key working capital turnovers are as follows: 20 On September 27, 2017, PSV purchased 6 plots of land with total areas of rai ( sq.wah) through PPC, a newlyincorporated subsidiary of PSV, at total price around Baht million. Please see more details in Part 3 Clause 2.2 (d) of this report. Capital Advantage Company Limited Page 63/89

64 Trade and other account receivables Inventory Trade and other payables 30 days on average 12 days on average 90 days on average Dividend payment CapAd assumes the dividend payment at 60% - 90% of net profit. Summary of financial projection of is as follows; (Unit: Baht million) PSV 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Revenue from medical services 1, , , , , , , , , , Cost of medical services (732.98) (825.26) (875.82) (959.02) (1,044.38) (1,113.31) (1,186.79) (1,268.59) (1,348.62) (1,437.63) Gross profit Total revenues 1, , , , , , , , , , EBITDA EBIT Net profit PSV 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Statement of Financial Position Total assets 1, , , , , , , , , , Total liabilities Shareholders equity , , , , , , Terminal Value Free cash flow growth after the forecasting period was estimated at 2% per annum. Discount Rate The discount rate applied to the calculation of the present value of free cash flow is the Weighted Average Cost of Capital (WACC), which derived from the weighted average of Cost of Debt (K d ) and Cost of Equity (K e ) based on the following formula; WACC = K e *E/(D+E) + K d *(1-T)*D/(D+E) Where K e = Cost of equity or shareholders required rate of return (R e ) K d = Cost of debt or borrowing rate of AMA Group T = Corporate income tax rate E = Total shareholders equity D = Interest-bearing debt Cost of equity (K e ) or the required rate of return for shareholders (R e ) is derived from the Capital Asset Pricing Model (CAPM) as follows; K e (or R e ) = R f + β (R m - R f ) Where Risk Free Rate (R f ) = 3.20% per annum based on 30-year government bond yield (information as of September 29, 2017), which is currently the longest government bond that is regularly issued or offered for sale by the Government, therefore, aligned with the assumption that AMA Group s operation is on an on-going basis. Beta (β) = times based on unlevered beta of 20 comparable SET- or MAIlisted companies 21 in health care services sector, services industry who operate in the private hospital business similar to AMA, a holding company invested in private hospitals. (1-year historical data until September 29, 2017), and then adjusted with estimated D/E ratio of AMA Group (consolidated) in the future. 21 Excluding Ekachai Medical Care PCL., Rajthanee Hospital PCL., and Ratchaphruek Hospital PCL., which were listed on the SET less than 1 year, and Wattanapat Hospital Trang PCL. (WPH) which has not yet listed at the preparation date of this report (September 29, 2017) (later listed on October 3, 2017). Capital Advantage Company Limited Page 64/89

65 Market Risk (R m ) = 13.20% per annum, which is the 25-year average rate of annual return from investment in the Stock Exchange of Thailand from (period from the enforcement of the Securities and Exchange Act B.E. 2535) as it is the most suitable period to reflect average return from the SET. K d = 5.00% per annum, which is equivalent to the estimated financial costs of AMG Group. D/E Ratio = Estimated D/E ratio at times, equivalent to estimated D/E ratio of AMA Group (consolidated) in the future. T = Estimated corporate income tax rate 20% per annum. Therefore, the discount rate or AMA Group s WACC is equal to 9.50% % per annum. By using above information and assumptions, calculation of PSV s future cash flow and value are as follows; (Unit: Baht million) PSV 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Free Cash Flow to (138.28) (243.92) Firm (FCFF) Present Value of FCFF (136.20) (219.40) PSV (Baht million) Total PV of FCFF PV of Terminal Value 1, Present Value of Free Cash Flow 2, Add: Cash and cash equivalents as of December 31, / Add: Current investment as of December 31, / Less: Interest bearing debts as of December 31, 2016 (14.90) 2/ Less: Dividend payments (60.00) 3/ Net Present Value of Free Cash Flow as of November 1, , Vacant land Uttaradit (for development of new hospital) /5/ Firm Value of PSV 2, Remark: 1/ Cash and cash equivalents were Baht million, and current investments were Baht 0.56 million, based on financial statements of PSV as of December 31, 2016, audited by a certified auditor approved by the SEC. 2/ Interest bearing debts consisted of liability under financial lease of Baht million, based on financial statements of PSV as of December 31, 2016, audited by a certified auditor approved by the SEC. 3/ The 2017 Annual General Meeting of Shareholders of PSV, held on April 27, 2017, resolved to approve the dividend payments from the net profit of 2016 at the rate of Baht 480 per share, totaling of Baht million. The dividend payment to the shareholders was made in May / The appraisal of land was based on the appraisal report prepared by Year Appraisal Co., Ltd. No. 2673/2560 dated September 6, / Please see feasibility of Pitsanuvej Uttaradit Hospital Project in Part 3 Clause 5.5 of this report. The fair value of PSV based on this approach is equal to Baht 2, million. In addition, CapAd has conducted a sensitivity analysis by adjusting the discount rate or WACC 22 increased (decreased) by 2.50% of the calculated discount rate mentioned above. PSV Unit Discount Rate (% per annum) 9.74% % 9.50% % 9.26% % NPV of Free Cash Flow of PSV Baht million 2, , , Fair value of vacant land in Uttaradit Baht million / / / Firm Value of PSV Baht million 2, , , Remark: 1/ The appraisal of land was based on the appraisal report prepared by Year Appraisal Co., Ltd. No. 2673/2560 dated September 6, / Please see feasibility of Pitsanuvej Uttaradit Hospital Project in Part 3 Clause 5.5 of this report. As shown in the table above, fair value of PSV is in the range of Baht 2, , million. 22 The IFA viewed that the change in discount rate would affect the change in NPV of free cash flow the most and should cover other factors affecting NPV of free cash flow to firm. Capital Advantage Company Limited Page 65/89

66 5.2 Union Pichit Doctors Company Limited ( SHV ) Union Pichit Doctors Co., (SHV) operates Sahavej Hospital, a 90-bed private hospital located in Muang Pichit District, Pichit province. The hospital was first opened on October 15, Currently, Sahavej Hospital offers medical services including Orthopedics Center, Emergency Center, Health Check-up Center, Urinary Tract Center, Kidney Center, X-ray Center, Internal Medicine Clinic, Surgery Clinic, Physical Therapy Center, Pediatrics Center, and Obstetrics and Gynecology Clinic. PSV has acquired SHV since March PSV has started the renovation of buildings and improvement of Sahavej Hospital including improvement of the standard of all systems of the hospital. Since the management could not provide details of historical data of the past 3 years (based on the financial statement for the year ended September 30, ), CapAd, therefore, constructed financial forecast for SHV based on the audited financial statement for the 3-month period ended December 31, 2016 audited by a certified auditor approved by the SEC, and the internal financial statement for the 6-month period ended June 30, 2017, which was prepared by SHV s management. CapAd constructed the financial forecast for SHV based on assumptions that information and documents received were completed and accurate under the current conditions and circumstances. Any change may materially affect SHV s business operation, financial projection, as well as shareholders decision regarding the consideration of fairness of acquisition price. The assumptions for SHV s financial forecast can be summarized as follows: Revenue from medical services Major revenues of Sahavej Hospital derived from revenue from in-patient-department (IPD) and out-patient-department (OPD) at the rate of 52% to 48%, respectively. (January June 2017) In (accounting period: 1 October 30 September), SHV had revenues from medical services of Baht million, Baht million and Baht million, respectively, or increased by 2.91%, 14.39% and 16.91% from the prior year, respectively. During October December 2016, revenue from medical services was Baht million and during January June 2017, revenue from medical services was Baht million. Main assumptions for the estimation of revenue from medical services are as follow: SHV Unit 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F No. of days days Utilization Rate OPD % n.a. n.a. n.a. n.a % 91.00% 47.17% 7/ IPD % n.a. n.a. n.a. n.a % 39.71% 45.57% OPD No. of OPD patients times/year n.a. n.a. 19,221 39,178 77,818 79,716 86,093 Average No. of OPD patients times/day n.a. n.a Average OPD revenue Baht/time n.a. n.a % growth of average No. of OPD % n.a. n.a. n.a. 3.60% 2.05% 4.00% 8.00% patients % growth of average OPD % n.a. n.a. n.a % % 5.00% 5.00% revenue IPD No. of admission Patients/year n.a. n.a. 2,428 3,134 6,225 6,377 7,318 Average No. of admission Patients/day n.a. n.a No. of IPD (beds) 5/ bed/year n.a. n.a. 6,636 7,836 15,564 15,943 18,295 Average IPD beds per day bed/day n.a. n.a Conversion ratio (IPD Admission/OPD) % n.a. n.a % 8.00% 8.00% 8.00% 8.50% Average length of stay days n.a. n.a Average IPD revenue Baht/day n.a. n.a. 5, , , , , % growth of average IPD revenue % n.a. n.a. n.a. 2.37% 2.37% 5.00% 5.00% Hemodialysis No. of hemodialysis patients Patients/year n.a. n.a. n.a. 8,031 16,311 16,425 16,425 Average No. of hemodialysis Patients/day n.a. n.a. n.a patients Average revenue Baht/time n.a. n.a. n.a. 1, , , , % growth of average No. of % n.a. n.a. n.a. n.a. n.a. 0.00% 0.00% hemodialysis patients % growth of average hemodialysis % n.a. n.a. n.a. n.a. n.a. 2.50% 2.50% revenue Revenue from OPD Baht mn. n.a. n.a Revenue from IPD Baht mn. n.a. n.a Revenue from hemodialysis Baht mn. n.a. n.a. - 6/ Revenue from medical services Baht mn % growth of revenue from OPD % n.a. n.a. n.a. n.a. n.a. 7.56% 13.40% % growth of revenue from IPD % n.a. n.a. n.a. n.a. n.a. 7.56% 20.49% Capital Advantage Company Limited Page 66/89

67 SHV Unit 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F % growth of revenue from % n.a. n.a. n.a. n.a. n.a. 3.22% 2.50% hemodialysis % growth of revenue from medical services % 14.39% 16.91% n.a. n.a. n.a. 6.85% 15.35% SHV Unit 2020F 2021F 2022F 2023F 2024F 2025F 2026F No. of days days Utilization Rate OPD % 50.95% 55.02% 57.23% 59.51% 61.89% 64.37% 66.95% IPD % 49.21% 53.15% 55.27% 57.49% 59.78% 62.18% 64.66% OPD No. of OPD patients times/year 92, , , , , , ,175 Average No. of OPD patients times/day Average OPD revenue Baht/time , , , % growth of average No. of OPD % 8.00% 8.00% 4.00% 4.00% 4.00% 4.00% 4.00% patients % growth of average OPD % 5.00% 5.00% 2.50% 2.50% 2.50% 2.50% 2.50% revenue IPD No. of admission Patients/year 7,903 8,536 8,877 9,232 9,601 9,985 10,385 Average No. of admission Patients/day No. of IPD (beds) 5/ bed/year 19,758 21,339 22,193 23,080 24,004 24,964 25,962 Average IPD beds per day bed/day Conversion ratio (IPD Admission/OPD) % 8.50% 8.50% 8.50% 8.50% 8.50% 8.50% 8.50% Average length of stay days Average IPD revenue Baht/day 7, , , , , , , % growth of average IPD revenue % 5.00% 5.00% 2.50% 2.50% 2.50% 2.50% 2.50% Hemodialysis No. of hemodialysis patients Patients/year 16,425 16,425 16,425 16,425 16,425 16,425 16,425 Average No. of hemodialysis Patients/day patients Average revenue Baht/time 2, , , , , , , % growth of average No. of % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% hemodialysis patients % growth of average hemodialysis % 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% revenue Revenue from OPD Baht mn Revenue from IPD Baht mn Revenue from hemodialysis Baht mn Revenue from medical services Baht mn % growth of revenue from OPD % 13.40% 13.40% 6.60% 6.60% 6.60% 6.60% 6.60% % growth of revenue from IPD % 13.40% 13.40% 6.60% 6.60% 6.60% 6.60% 6.60% % growth of revenue from % 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% hemodialysis % growth of revenue from medical services % 11.87% 12.00% 6.12% 6.13% 6.15% 6.16% 6.18% Remark: 1/ Accounting period from October 1, 2014 to September 30, / Accounting period from October 1, 2015 to September 30, 2016 (PSV acquired SHV in March 2016). 3/ Accounting period from October 1, 2016 to December 31, / Internal financial statement of SHV. 5/ No. of IPD patients (beds) = No. of admission x Average length of stay. 6/ SHV did not record revenue from hemodialysis separately. 7/ SHV plans to construct new building which shall increase its OPD capacity from 240 times/day to 500 times per day in OPD No. of OPD visits No. of OPD visits in October December 2016 and the first half of 2017 was 19,221 times and 39,178 times, respectively, or average of times per day and times per day, respectively. No. of OPD visits per day was increased after renovation of the buildings and improvement of the image of the hospital. In this financial forecast, CapAd assumed No. of OPD visits in 2017 of 38,640 times (average of times per day). No. of OPD visits in the second half of 2017 was estimated at 210 times per day, based on the average No. of OPD visits per day in October December 2016 and in the first half of No. of OPD visits per day in 2018 was assumed to increase by 4% from those of the second half of 2017, based on the cumulative average growth of population aged 65 and over in northern of Thailand in of around 3.63% per annum, and the cumulative average growth of population aged 60 and over in northern of Thailand in of around 5.05% per annum. Capital Advantage Company Limited Page 67/89

68 In , it was assumed that No. of OPD visits per day shall increase by 8% per annum resulting from opening of new IPD building. OPD capacity per day will increase from 240 times per day to 500 times per day. After that, in , OPD visits per day was assumed to grow by 4% per annum, based on the cumulative average growth of population aged 65 and over in northern of Thailand in Average OPD revenue Average OPD revenue per visit in October December 2016 and the first half of 2017 was Baht and Baht , or decreased by 13.52%. In this financial forecast, CapAd assumed average OPD revenue per visit in 2017 of Baht , which was the average OPD revenue in January June In , average OPD revenue per visit was assumed to grow by 5% per annum, based on SHV s estimation. Besides, in , it was assumed that the average OPD revenue per visit shall increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. IPD No. of admission No. of IPD admission in October December 2016 and the first half of 2017 were 2,428 patients and 3,134 patients, respectively, or average IPD admission of patients per day and patients per day, respectively. In this financial forecast, CapAd assumed the conversion ratio in at 8.00% of OPD visits, which was equivalent to the average conversion ratio in the first half of The conversion ratio in was estimated at 8.50% of OPD visits, resulting from renovation of building and improvement and new hospital building. In addition, CapAd estimated the average length of stay at 2.50 days, based on the average length of stay in the first half of Average IPD revenue In October December 2016 and the first half of 2017, average IPD revenue per day was Baht 5, and Baht 6,129.06, respectively. In this financial forecast, CapAd assumed average IPD revenue per day in 2017 of Baht 6,129.06, which was the average IPD revenue per day in the first half of In , average IPD revenue per day was assumed to grow by 5% per annum, based on SHV s estimation. Besides, in , it was assumed that the average IPD revenue per day increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. Hemodialysis No. of hemodialysis patients In the first half of 2017, No. of hemodialysis patients was equal to 8,031 patients or average of patients per day (SHV did not record information of hemodialysis separately in October December 2016.). In this financial forecast, No. of hemodialysis patients was assumed at 45 patients per day throughout the projection period, which was equivalent to the average No. of hemodialysis patient per day in the first half of Average revenue from hemodialysis In the first half of 2017, the average revenue from hemodialysis was Baht 1, In this financial forecast, the average revenue from hemodialysis in 2017 was estimated at Baht 1,860.00, which was equivalent to those of in the first half of In , average revenue from hemodialysis was assumed to grow by 2.5% per annum, based on estimated inflation rate and on conservative basis. Cost of medical services Cost of medical services consisted of cost of physicians and medical personnel, medicine and medical supplies, cost of hemodialysis and other expense. Details are as follows: (Unit: Baht million) SHV 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F Cost of medicine and medical supplies n.a. n.a Cost of physicians n.a. n.a Cost of medical personnel n.a. n.a Cost of hemodialysis n.a. n.a Capital Advantage Company Limited Page 68/89

69 SHV 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F Depreciation and amortization expenses n.a. n.a Other expenses n.a. n.a Total cost of medical services % to revenue from medical services Cost of medicine and medical supplies 5/ n.a. n.a % 16.48% 16.48% 16.48% 16.48% Cost of physicians 5/ n.a. n.a % 30.42% 30.42% 30.42% 30.42% Cost of medical personnel 5/ n.a. n.a % 23.83% 23.83% 23.83% 23.83% Cost of hemodialysis 6/ n.a. n.a. n.a % 86.63% 86.63% 86.63% Depreciation and amortization expenses n.a. n.a. 4.03% 0.00% 2.79% 4.35% 7.48% Other expenses n.a. n.a. 1.33% 0.10% 0.10% 0.10% 0.10% Total cost of medical services 77.35% 64.05% 77.46% 73.38% 76.22% 77.70% 80.54% SHV 2020F 2021F 2022F 2023F 2024F 2025F 2026F Cost of medicine and medical supplies Cost of physicians Cost of medical personnel Cost of hemodialysis Depreciation and amortization expenses Other expenses Total cost of medical services % to revenue from medical services Cost of medicine and medical supplies 5/ 16.48% 16.48% 16.48% 16.48% 16.48% 16.48% 16.48% Cost of physicians 5/ 30.42% 30.42% 30.42% 30.42% 30.42% 30.42% 30.42% Cost of medical personnel 5/ 22.27% 20.82% 20.70% 20.58% 20.47% 20.35% 20.24% Cost of hemodialysis 6/ 86.63% 86.63% 86.63% 86.63% 86.63% 86.63% 86.63% Depreciation and amortization expenses 7.17% 6.88% 6.86% 4.32% 3.32% 3.30% 3.26% Other expenses 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% Total cost of medical services 78.69% 76.92% 76.72% 74.01% 72.84% 72.64% 72.43% Remark: 1/ Accounting period from October 1, 2014 to September 30, / Accounting period from October 1, 2015 to September 30, 2016 (PSV acquired SHV in March 2016). 3/ Accounting period from October 1, 2016 to December 31, / Internal financial statement of SHV. 5/ Percentage of expenses to revenues from OPD and IPD. 6/ Percentage of expenses to revenues from hemodialysis. In (accounting period from 1 October to 30 September), cost of medical services were Baht million, Baht million, and Baht million respectively, or accounted for 80.25%, 77.35% and 64.05% of revenue from medical services, respectively. In October December 2016 and the first half of 2017, cost of medical services were Baht million and Baht million, respectively, or accounted for 77.46% and 73.38% of revenue from medical services, respectively. Key assumptions on cost of medical services were as follows: - Cost of medicine and medical supplies was assumed at 16.48% of revenue from IPD and OPD throughout the projection period, which was equivalent to percentage of cost of medicine and medical supplies to revenue from IPD and OPD in the first half of Cost of physicians was assumed at 30.42% of revenue from IPD and OPD throughout the projection period, which was equivalent to percentage of cost of physicians to revenue from IPD and OPD in the first half of Cost of medical personnel in was estimated at 23.83% of revenue from IPD and OPD. After completion of construction of new building and increase of OPD service capacity, CapAd assumed that cost of medical personnel in increase by 6% per annum. - Other expenses were estimated at 0.10% of revenue from medical services throughout the projection period, which was equivalent to percentage of other expenses to revenue from medical services in the first half of Cost of hemodialysis was estimated at 86.63% of revenue from hemodialysis throughout the projection period, which was equivalent to percentage of cost of hemodialysis to revenue from hemodialysis in the first half of Other incomes Other incomes consisted of revenue from canteen, revenue from shop, revenue from coffee shop, interest incomes and other incomes. In (accounting period from 1 October to 30 September), other incomes were Baht 2.49 million and Baht 6.00 million, respectively, or accounted for 1.65% and 3.39% of revenue from medical services. In October December 2016 and the first half of 2017, other incomes were Baht 4.80 million and Baht 3.53 million, respectively, or accounted for 8.46% and 3.79% of revenue from medical services. Capital Advantage Company Limited Page 69/89

70 In , CapAd assumed revenue from canteen, shop and coffee shop at 3.55% of revenue from medical services, and other incomes was estimated at 0.21% of revenue from medical services, which were equivalent to percentage of such incomes to revenue from medical services in the first half of In addition, interest incomes were estimated at 0.75% of average cash and cash equivalent. (Unit: Baht million) SHV 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F Revenue from canteen, shop and n.a. n.a coffee shop Interest incomes n.a. n.a Other incomes n.a. n.a Total other incomes % to revenue from medical services Revenue from canteen, shop and coffee shop n.a. n.a % 3.55% 3.55% 3.55% Interest incomes n.a. n.a. 0.07% 0.03% 0.03% 0.03% 0.02% Other incomes n.a. n.a. 8.39% 0.21% 0.21% 0.21% 0.21% Total other incomes 1.65% 3.39% 8.46% 3.79% 3.79% 3.79% 3.78% SHV 2020F 2021F 2022F 2023F 2024F 2025F 2026F Revenue from canteen, shop and coffee shop Interest incomes Other incomes Total other incomes % to revenue from medical services Revenue from canteen, shop and 3.55% 3.55% 3.55% 3.55% 3.55% 3.55% 3.55% coffee shop Interest incomes 0.02% 0.01% 0.02% 0.03% 0.03% 0.03% 0.03% Other incomes 0.21% 0.21% 0.21% 0.21% 0.21% 0.21% 0.21% Total other incomes 3.77% 3.77% 3.78% 3.78% 3.79% 3.79% 3.79% Remark: 1/ Accounting period from October 1, 2014 to September 30, / Accounting period from October 1, 2015 to September 30, / Accounting period from October 1, 2016 to December 31, / Internal financial statement of SHV Selling and administrative expenses Selling and administrative expenses consisted of employee expenses, repair and maintenance expenses, utility expenses, marketing expenses, rental fee, office supplies, depreciation and amortization expenses, cleaning and security expenses, cost of canteen, cost of shop, cost of coffee shop and other expenses. (Unit: Baht million) SHV 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F Employee and management n.a. n.a expenses Marketing expenses n.a. n.a Utility expenses n.a. n.a Repair and maintenance expenses n.a. n.a Rental fee n.a. n.a Cleaning and security expenses n.a. n.a Cost of food (canteen) n.a. n.a Cost of shop n.a. n.a Cost of coffee shop n.a. n.a Cost of asset improvement n.a. n.a Depreciation and amortization n.a. n.a expenses Other expenses n.a. n.a Total selling and administrative expenses % to revenue from medical services Employee and management n.a. n.a % 12.77% 12.82% 12.65% 11.57% expenses Marketing expenses n.a. n.a. 1.50% 0.40% 0.47% 0.57% 0.50% Utility expenses n.a. n.a. 2.29% 2.65% 2.66% 2.55% 2.27% Repair and maintenance expenses n.a. n.a. 0.44% 1.26% 1.14% 1.10% 0.97% Rental fee n.a. n.a. 0.00% 0.76% 0.76% 0.73% 0.65% Cleaning and security expenses n.a. n.a. 0.00% 3.46% 3.47% 3.33% 2.96% Cost of food (canteen) n.a. n.a. 0.00% 0.54% 0.54% 0.54% 0.54% Cost of shop n.a. n.a. 1.73% 1.22% 1.22% 1.22% 1.22% Cost of coffee shop n.a. n.a. 0.00% 0.24% 0.24% 0.24% 0.24% Cost of asset improvement n.a. n.a. 0.00% 0.30% 0.15% 0.00% 0.00% Depreciation and amortization n.a. n.a. 0.30% 0.00% 0.31% 0.48% 0.83% Capital Advantage Company Limited Page 70/89

71 SHV 2015A 1/ 2016A 2/ Q4.2016A 3/ 1H2017A 4/ 2017F 2018F 2019F expenses Other expenses n.a. n.a. 4.14% 2.40% 2.41% 2.31% 2.06% Total selling and administrative 18.57% 24.18% 28.71% 26.01% 26.20% 25.73% 23.81% expenses % growth of SG&A 31.20% 52.27% n.a. n.a. n.a. 4.92% 6.76% SHV 2020F 2021F 2022F 2023F 2024F 2025F 2026F Employee and management expenses Marketing expenses Utility expenses Repair and maintenance expenses Rental fee Cleaning and security expenses Cost of food (canteen) Cost of shop Cost of coffee shop Cost of asset improvement Depreciation and amortization expenses Other expenses Total selling and administrative expenses % to revenue from medical services Employee and management 10.91% 10.28% 10.22% 10.16% 10.10% 10.05% 9.99% expenses Marketing expenses 0.46% 0.42% 0.41% 0.39% 0.38% 0.37% 0.35% Utility expenses 2.08% 1.90% 1.83% 1.77% 1.71% 1.65% 1.59% Repair and maintenance expenses 0.89% 0.82% 0.79% 0.76% 0.74% 0.71% 0.69% Rental fee 0.60% 0.55% 0.53% 0.51% 0.49% 0.47% 0.46% Cleaning and security expenses 2.71% 2.48% 2.40% 2.32% 2.24% 2.16% 2.09% Cost of food (canteen) 0.54% 0.54% 0.54% 0.54% 0.54% 0.54% 0.54% Cost of shop 1.22% 1.22% 1.22% 1.22% 1.22% 1.22% 1.22% Cost of coffee shop 0.24% 0.24% 0.24% 0.24% 0.24% 0.24% 0.24% Cost of asset improvement 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Depreciation and amortization 0.80% 0.76% 0.76% 0.48% 0.37% 0.37% 0.36% expenses Other expenses 1.88% 1.72% 1.67% 1.61% 1.55% 1.50% 1.45% Total selling and administrative 22.33% 20.93% 20.60% 20.00% 19.58% 19.28% 18.98% expenses % growth of SG&A 4.90% 5.00% 4.45% 3.04% 3.91% 4.51% 4.53% Remark: 1/ Accounting period from October 1, 2014 to September 30, / Accounting period from October 1, 2015 to September 30, / Accounting period from October 1, 2016 to December 31, / Internal financial statement of SHV. In (accounting period from 1 October to 30 September), selling and administrative expenses were Baht million, Baht million, and Baht million respectively, or accounted for 16.19%, 18.57%, and 24.18% of revenue from medical services, respectively. Selling and administrative expenses increased by 31.20% and 52.27%, respectively. In October December 2016 and the first half of 2017, selling and administrative expenses were Baht million and Baht million, respectively, or accounted for 28.71% and 26.01% of revenue from medical services, respectively. Key assumptions on selling and administrative expenses were as follows: - Employee and management expenses in 2017 was equivalent to the annualized of those expenses in the first half of In , employee and management expenses were expected to increase by 6% per annum based on SHV s policy. - Marketing expenses in were estimated at Baht 2.00 million, based on SHV s budget approved by the board of directors meeting. In , marketing expense were assumed to increase by 2.5% per annum, based on estimated inflation rate. - In 2017, utility expense, rental fee, cleaning and security services and other expenses were equivalent to the annualized of such expenses in the first half of In , utility expense, rental fee, cleaning and security services and other expenses were assumed to increase by 2.5% per annum, based on estimated inflation rate. - Repair and maintenance expenses in 2017 was estimated at Baht 2.14 million, based on repair and maintenance expenses in the first half of In , repair and maintenance expenses were assumed to increase by 2.5% per annum, based on estimated inflation rate. Capital Advantage Company Limited Page 71/89

72 Financial costs Financial costs consist of interest expenses for short-term loans and long-term loans from financial institution, which was at the average interest rate of 4% % per annum based on term and conditions of the loan agreements. In addition, CapAd assumed that SHV would require additional loans around Baht 160 million in to support the construction of new hospital building, purchase of medical equipment and working capital. Corporate income taxes Corporate income tax rate of 20% was assumed throughout the projection period. Capital Expenditure Capital expenditure in 2017 was estimated at Baht million, based on the budget of SHV, consisted of renovation of buildings of around Baht 10 million and the remaining for purchase of medical equipment and other assets. Capital expenditure in 2018 was estimated at Baht million, based on the budget of SHV, consisted of cost of construction of new building for Baht 60 million, and the remaining for purchase of medical equipment and other assets. In , capital expenditures for medical equipment and other assets were assumed at 3% of revenue from medical services, according to PSV s projection based on experience in private hospital operation of management team and equivalent to average capital expenditure of industry at around 3% - 4% of revenue from medical services. Assets and liabilities turnover Based on historical data of October December 2016 and the first half of 2017, key working capital turnovers are as follows: Trade and other account receivables 54 days on average Inventory 14 days on average Trade and other payables 76 days on average Dividend payment The 2017 Annual General Meeting of Shareholders of SHV approved the dividend payment of Baht 11 million to shareholders whose name were on share registration book as at April 20, (SHV has not yet made a payment to shareholders.) Summary of financial projection of is as follows; (Unit: Baht million) SHV 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Revenue from medical services Cost of medical services (136.10) (153.87) (183.98) (201.08) (220.16) (233.01) (238.55) (249.21) (263.86) (279.34) Gross profit Total revenues EBITDA 7.18 (4.61) (10.74) (3.28) EBIT 1.97 (8.85) (20.30) (13.31) (4.95) (3.56) Net profit 1.44 (14.19) (29.73) (23.63) (15.99) (14.95) SHV 2560F 2561F 2562F 2563F 2564F 2565F 2566F 2567F 2568F 2569F Statement of Financial Position Total assets Total liabilities Shareholders equity Terminal Value Free cash flow growth after the forecasting period was estimated at 2% per annum. Discount Rate Please see details of assumption in Part 3 Clause 5.1 of this report. Therefore, the discount rate or WACC is equal to 9.50% % per annum. By using above information and assumptions, calculation of SHV s future cash flow and value are as follows; Capital Advantage Company Limited Page 72/89

73 (Unit: Baht million) SHV 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Free Cash Flow to Firm (21.74) (96.26) (7.22) (1.81) (FCFF) Present Value of FCFF (21.41) (86.59) (5.93) (1.36) SHV (Baht million) Total PV of FCFF (48.47) PV of Terminal Value Present Value of Free Cash Flow Add: Cash and cash equivalents as of December 31, / Less: Dividend payments (11.00) 2/ Net Present Value of Free Cash Flow as of November 1, Remark: 1/ Cash and cash equivalents were Baht million, based on financial statements of SHV as of December 31, 2016, audited by a certified auditor. 2/ The 2017 Annual General Meeting of Shareholders of SHV approved the dividend payment of Baht 11 million. The fair value of SHV based on this approach is equal to Baht million. In addition, CapAd has conducted a sensitivity analysis by adjusting the discount rate or WACC 23 increased (decreased) by 2.50% of the calculated discount rate mentioned above. SHV Unit Discount Rate 9.74% % 9.50% % 9.26% % NPV of Free Cash Flow of SHV Baht million As shown in the table above, the fair value of SHV is in the range of Baht million. 23 Please see Footnote 22. Capital Advantage Company Limited Page 73/89

74 5.3 Paknampo Hospital Company Limited ( PNP ) Paknampo Hospital Company Limited (formerly named Ten M.D. Nakhonsawan Company Limited) was established on September 28, 1987 and has been registered as a hospital operator. Currently, there are two hospitals under PNP, namely Paknampo hospital ( PNP1 ) and Paknampo 2 hospital ( PNP2 ) (PNP acquired Rattanavej Hospital in 2014 and changed the name to Paknampo 2 Hospital). Both are 100-bed hospitals, located in Muang Nakhon Sawan District, Nakhon Sawan Province. In addition, both hospitals are private hospitals that have been accredited by The Healthcare Accreditation Institute (Public Organization). PNP1 and PNP2 provide upper secondary care to cash and private insurance patients.. Their medical services consist of Emergency Center, Pediatric Clinic, Dental Clinic, Diagnostic Radiography Center, Gastrointestinal and Liver Clinic, Heart and Cardiovascular Clinic, ICU, Infectious Disease Clinic, Internal Medicine Clinic, Laboratory, Neuroscience Clinic, Orthopedic Clinic, Physical Therapy Clinic, Surgery Clinic, Nephrology-kidney Center, Urinary Tract Center, Medical Check-up Center, Genecology and Obstetricians Clinic, and Ear, Nose and Throat Clinic. The assumptions for PNP s financial forecast can be summarized as follows: Revenue from medical services Major revenues of PNP1 and PNP2 derived from revenue from in-patient-department (IPD) and out-patient-department (OPD) at the rate of 68% to 32% respectively. (Year 2016) In , revenues from medical services were Baht million, Baht million and Baht million, respectively, or decreased by 5.70% and increased by 20.55% from prior year, respectively. PNP acquired PNP2 in In 2015, PNP renovated PNP2 and constructed new buildings at PNP2. In 2016, PNP renovated PNP1 and constructed new buildings at PNP1. Main assumptions are as follow: PNP Unit 2014A 1/ 2015A 2016A 1H2017A 2/ 2017F 2018F 2019F No. of days days Utilization Rate OPD % n.a % 20.14% 19.42% 20.91% 23.00% 25.30% IPD % n.a % 41.28% 31.29% 33.90% 37.01% 40.71% OPD PNP 1 No. of OPD patients times/year n.a. 70,641 56,134 22,895 48,655 53,521 58,873 Average No. of OPD patients times/day n.a Average OPD revenue Baht/time n.a. 1, , , , , , % growth of average No. of OPD % n.a. n.a % % 5.38% 10.00% 10.00% patients % growth of average OPD % n.a. n.a % -0.15% -0.15% 10.00% 10.00% revenue OPD PNP 2 No. of OPD patients times/year n.a. 20,832 39,689 22,798 50,553 55,609 61,170 Average No. of OPD patients times/day n.a Average OPD revenue Baht/time n.a , , , , , % growth of average No. of OPD patients % n.a. n.a % 16.15% 9.96% 10.00% 10.00% % growth of average OPD % n.a. n.a % 17.18% 17.18% 10.00% 10.00% revenue IPD PNP1 No. of admission Patients/year n.a. 9,600 6,889 2,364 5,024 5,887 6,476 Average No. of admission Patients/day n.a No. of IPD (beds) 3/ bed/year n.a. 22,873 15,900 5,103 10,844 13,541 14,895 Average IPD beds bed/day n.a Conversion ratio (IPD Admission/OPD) % n.a % 12.27% 10.33% 10.33% 11.00% 11.00% Average length of stay days n.a Average IPD revenue Baht/day n.a. 8, , , , , , % growth of average IPD % n.a % 10.40% 32.57% 10.40% 10.00% 10.00% revenue IPD PNP2 No. of admission Patients/year n.a. 4,606 8,392 3,227 7,156 8,063 8,870 Average No. of admission Patients/day n.a No. of IPD (beds) 3/ bed/year n.a. 12,565 23,078 9,508 21,085 22,658 24,924 Average IPD beds bed/day n.a Conversion ratio (IPD Admission/OPD) % n.a % 21.14% 14.15% 14.15% 14.50% 14.50% Average length of stay days n.a Average IPD revenue Baht/day n.a. 5, , , , , , % growth of average IPD % n.a % 13.36% 15.57% 13.36% 10.00% 10.00% revenue Revenue from OPD PNP1 Baht mn. n.a Capital Advantage Company Limited Page 74/89

75 PNP Unit 2014A 1/ 2015A 2016A 1H2017A 2/ 2017F 2018F 2019F Revenue from IPD PNP1 Baht mn. n.a Total revenue PNP1 Baht mn. n.a Revenue from OPD PNP2 Baht mn. n.a Revenue from IPD PNP2 Baht mn. n.a Total revenue PNP2 Baht mn. n.a Others Baht mn. n.a Revenue from medical services Baht mn % growth of revenue PNP1 % n.a. n.a % n.a % 31.07% 21.00% % growth of revenue PNP2 % n.a. n.a % n.a % 19.16% 21.00% % growth of revenue from % n.a % 20.55% n.a % 25.10% 21.00% medical services PNP Unit 2020F 2021F 2022F 2023F 2024F 2025F 2026F No. of days days Utilization Rate OPD % 27.83% 30.61% 31.84% 33.11% 34.43% 35.81% 37.24% IPD % 44.78% 50.93% 52.97% 55.08% 57.29% 59.58% 61.96% OPD PNP 1 No. of OPD patients times/year 64,937 71,236 74,085 77,049 80,350 83,336 86,669 Average No. of OPD patients times/day Average OPD revenue Baht/time 2, , , , , , , % growth of average No. of OPD % 10.00% 10.00% 4.00% 4.00% 4.00% 4.00% 4.00% patients % growth of average OPD % 10.00% 5.00% 5.00% 5.00% 2.50% 2.50% 2.50% revenue OPD PNP 2 No. of OPD patients times/year 67,471 74,015 76,976 80,055 83,485 86,587 90,051 Average No. of OPD patients times/day Average OPD revenue Baht/time 1, , , , , , , % growth of average No. of OPD % 10.00% 10.00% 4.00% 4.00% 4.00% 4.00% 4.00% patients % growth of average OPD % 10.00% 5.00% 5.00% 5.00% 2.50% 2.50% 2.50% revenue IPD PNP1 No. of admission Patients/year 7,143 8,548 8,890 9,246 9,642 10,000 10,400 Average No. of admission Patients/day No. of IPD (beds) 3/ bed/year 16,429 19,661 20,448 21,265 22,177 23,001 23,921 Average IPD beds bed/day Conversion ratio (IPD Admission/OPD) % 11.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% Average length of stay days Average IPD revenue Baht/day 16, , , , , , , % growth of average IPD % 10.00% 5.00% 5.00% 5.00% 2.50% 2.50% 2.50% revenue IPD PNP2 No. of admission Patients/year 9,783 10,732 11,161 11,608 12,105 12,555 13,057 Average No. of admission Patients/day No. of IPD (beds) 3/ bed/year 27,491 30,157 31,364 32,618 34,016 35,280 36,691 Average IPD beds bed/day Conversion ratio (IPD Admission/OPD) % 14.50% 14.50% 14.50% 14.50% 14.50% 14.50% 14.50% Average length of stay days Average IPD revenue Baht/day 8, , , , , , , % growth of average IPD % 10.00% 5.00% 5.00% 5.00% 2.50% 2.50% 2.50% revenue Revenue from OPD PNP1 Baht mn Revenue from IPD PNP1 Baht mn Total revenue PNP1 Baht mn Revenue from OPD PNP2 Baht mn Revenue from IPD PNP2 Baht mn Total revenue PNP2 Baht mn Others Baht mn Revenue from medical services Baht mn , , , , , % growth of revenue PNP1 % 21.33% 21.94% 9.20% 9.20% 6.89% 6.31% 6.60% % growth of revenue % 21.33% 15.18% 9.20% 9.20% 6.89% 6.31% 6.60% PNP2 % growth of revenue from medical services % 21.33% 18.78% 9.20% 9.20% 6.89% 6.31% 6.60% Remark: 1/ In 2014, PNP changed accounting period and acquired PNP2. Thus, historical data of 2014 may differ from those of / Internal financial statement of PNP. 3/ No. of IPD patients (beds) = No. of admission x Average length of stay. Capital Advantage Company Limited Page 75/89

76 (1) Paknampo Hospital (PNP1) In and the first half of 2017, revenue from medical services was Baht million, Baht million and Baht million, respectively. Revenue from medical services decreased due to PNP1 underwent renovation and construction of new buildings since The construction and renovation was expected to complete in OPD (PNP1) No. of OPD visits (PNP1) No. of OPD visits in and the first half of 2017 were 70,641 times, 56,134 times and 22,895 times, respectively, or the average No. of OPD visits of times per day, times per day, times per day, respectively. No. of OPD visits per day were decreased due mainly to renovation and construction of PNP1. In this financial forecast, CapAd assumed No. of OPD visits in 2017 of 48,655 times (average No. of OPD visits at times per day). The average No. of OPD visit in the second half of 2017 was based on the average No. of OPD visits per day in May July 2017 of around 140 times per day. This was due to reopen of new OPD building in 2017 and No. of OPD visits have been gradually increased in mid PNP has celebrated 29 th anniversary in May In addition, PNP has marketing and PR plans to increase awareness of its services and new images. In , No. of OPD visits was expected to grow by 10% per annum, or increase around patients per day, resulting from its marketing and PR plans such as communication through social media and main media channel in the province, CSR, check-up packages and activities in the hospital. In addition, PNP has planned to recruit medical specialists from hospitals in Bangkok and nearby areas. Besides, No. of OPD visits in 2015 prior to hospital renovation were almost 200 patients per day. In , No. of OPD visits per day was assumed to grow by 4% per annum, based on the cumulative average growth of population aged 65 and over in northern region of Thailand in of around 3.63% per annum, and the cumulative average growth of population aged 60 and over in northern region of Thailand in of around 5.05% per annum. Average OPD revenue (PNP1) In and the first half of 2017, average OPD revenue per visit was Baht 1,504.50, Baht 1, and Baht 1,750.03, respectively, or increased by 16.49% and decreased 0.15% from the prior year, respectively. The increase of average OPD revenue was from price adjustment and new image of PNP1. In this financial forecast, CapAd assumed average OPD revenue per visit in 2017 of Baht 1,750.03, which was the average OPD revenue per visit in January June 2017 and closed to the average OPD revenue of In , average OPD revenue per visit was assumed to grow by 10% per annum, due to completion of new building and renovation of PNP1 around end of Besides, PNP has planned to hire medical specialists to draw more patients and revenue to the hospital. In , average OPD revenue per visit was assumed to grow by 5% per annum. After that in , it was assumed that the average OPD revenue per visit increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. IPD (PNP1) In and the first half of 2017, revenue from IPD was Baht million, Baht million and Baht million, respectively. The revenue from IPD was decreased due to PNP1 has been under renovation and construction of new buildings. No. of admission (PNP1) In and the first half of 2017, No. of IPD admission was 9,600 patients, 6,889 patients and 2,364 patients, respectively, or the average IPD admission of patients per day, patients per day and patients per day, respectively. No. of IPD admission was decreased due to PNP1 has been under renovation and construction of new buildings. Currently, PNP1 is under renovation of patient rooms which is expected to complete in In this financial forecast, CapAd assumed the conversion ratio in 2017 at 10.33% of OPD visit, based on the conversion ratio of the first half of Conversion ratio in was assumed at 11%, which was equivalent to the average conversion ratio of 2016 and the first half of 2017 (PNP1 has been under renovation in these periods.). In , after the completion of all renovation and construction of new buildings of PNP1 and implementation of its marketing and Capital Advantage Company Limited Page 76/89

77 business plans, conversion ratio was estimated at 12%, which was equivalent to the average conversion ratio of and the first half of In addition, CapAd estimated the average length of stay in 2017 at 2.16 days, based on the average length of stay in the first half of In , the average length of stay was estimated at 2.30 days, based on the average length of stay in and the first half of 2017 which was in the range of days. Average IPD revenue per day (PNP1) In and the first half of 2017, average IPD revenue per day was Baht 8,586.17, Baht 11, and Baht 12,566.82, respectively, or increased by 35.57% and 10.40%, respectively. In this financial forecast, CapAd assumed average IPD revenue per day in 2017 of Baht 12,566.82, which was the average IPD revenue per day in January June 2017, or increased around 10.40% of the average IPD revenue per day of In , the average IPD revenue per day was estimated to increase by 10% per annum, which was close to the percentage growth of average IPD revenue per day in 2016 and after the completion of renovation around end of In , average IPD revenue per day was assumed to grow by 5% per annum. In , it was assumed that the average IPD revenue per day increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. (2) Paknampo 2 Hospital (PNP2) In and the first half of 2017, revenue from medical services was Baht million, Baht million, and Baht million, respectively. OPD (PNP2) No. of OPD visits (PNP2) No. of OPD visits in and the first half of 2017 were 20,832 times, 39,689 times and 22,798 times, respectively, or the average No. of OPD visits of times per day, times per day, times per day, respectively. No. of OPD visits per day were increased after the completion of renovation and construction of new buildings of PNP2. At present, the work in progress is only the construction top floors of the parking building. (PNP acquired PNP2 in 2014.) In this financial forecast, CapAd assumed No. of OPD visits in 2017 at 50,553 times (average No. of OPD visits at times per day), based on No. of OPD visits in January July 2017 and annualized with the percentage of No. of OPD visits in 7-month period of 2016 to total OPD visits of In , No. of OPD visits was expected to grow by 10% per annum, or to increase around patients per day, resulting from its marketing and PR plans such as communication through social media and main media channel in the province, CSR, check-up packages and activities in the hospital. In addition, PNP has planned to open night-clinic at PNP2. In , No. of OPD visits was assumed to grow by 4% per annum, based on the cumulative average growth of population aged 65 and over in northern region of Thailand in of around 3.63% per annum, and the cumulative average growth of population aged 60 and over in northern region of Thailand in of around 5.05% per annum. Average OPD revenue (PNP2) In and the first half of 2017, average OPD revenue per visit was Baht , Baht 1,229.43, and Baht 1,440.66, respectively, or increased by 35.81% and 17.18% from the prior year, respectively. In this financial forecast, CapAd assumed average OPD revenue per visit in 2017 of Baht 1,440.66, which was the average OPD revenue in January June In , average OPD revenue per visit was assumed to grow by 10% per annum to be in line with the price adjustment of PNP1. In , average OPD revenue per visit was assumed to grow by 5% per annum. After that, in , it was assumed that the average OPD revenue per visit increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. IPD (PNP2) In and the first half of 2017, revenue from IPD was Baht million, Baht million, and Baht million, respectively. Revenue from IPD of PNP2 has been successively increased since the acquisition of PNP2 and renovation of PNP2 including purchase of new medical equipment. Capital Advantage Company Limited Page 77/89

78 No. of admission (PNP2) In and the first half of 2017, No. of IPD admission was 4,606 patients, 8,392 patients, and 3,227 patients, respectively, or equivalent to the average IPD admission of patients per day, patients per day and patients per day, respectively. In this financial forecast, CapAd assumed the conversion ratio in 2017 at 14.15% of OPD visit, based on the conversion ratio of the first half of Conversion ratio in was assumed at 14.5%, which was slightly higher than the conversion ratio of the first half of 2017, but still lower than the conversion ratio of the first half of In addition, CapAd estimated the average length of stay in 2017 at 2.95 days, based on the average length of stay in the first half of In , the average length of stay was estimated at 2.81 days, based on the average length of stay in and the first half of 2017 which was in the range of days. Average IPD revenue (PNP2) In and the first half of 2017, average IPD revenue per day was Baht 5,112.59, Baht 5,908.74, and Baht 6,697.89, respectively, or increased by 15.57% and 13.36%, respectively. In this financial forecast, CapAd assumed average IPD revenue per day in 2017 of Baht 6,697.89, which was the average IPD revenue per day in January June 2017, or increased around 13.36% of the average IPD revenue per day of In , the average IPD revenue per day was estimated to increase by 10% per annum, which was close to the percentage growth of average IPD revenue per day in In , average IPD revenue per day was assumed to grow by 5% per annum. Then, in , it was assumed that the average IPD revenue per day to increase by 2.5% per annum, based on estimated inflation rate and on conservative basis. Cost of medical services Cost of medical services consisted of cost of physicians and medical personnel, medicine and medical supplies, outside lab, cost of hemodialysis, patient food, and other expense. Details are as follows: (Unit: Baht million) PNP 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Cost of physicians Cost of medical personnel Cost of medicine and medical supplies Cost of chemical supplies Depreciation and amortization expenses Cost of outside lab Cost of hemodialysis Cost of patient food Cost of supplies Other costs Total cost of medical services % to revenue from medical services Cost of physicians 16.60% 19.67% 21.03% 24.12% 24.12% 24.12% 21.60% Cost of medical personnel 23.65% 24.64% 25.37% 25.65% 25.48% 25.48% 25.48% Cost of medicine and medical supplies 12.19% 14.05% 13.32% 13.30% 13.31% 13.71% 11.71% Cost of chemical supplies 1.71% 2.36% 2.13% 2.03% 2.05% 2.05% 2.05% Depreciation and amortization expenses 2.42% 4.97% 8.92% 14.09% 13.31% 15.01% 12.90% Cost of outside lab 0.53% 0.76% 0.43% 0.43% 0.43% 0.43% 0.43% Cost of hemodialysis 0.00% 0.00% 1.41% 0.62% 0.62% 0.62% 0.62% Cost of patient food 2/ 6.51% 2.17% 1.59% 1.59% 1.59% 1.59% 1.59% Cost of supplies 1.44% 2.65% 1.80% 1.65% 1.70% 1.70% 1.70% Other costs 4.53% 0.96% 0.50% 1.63% 1.00% 1.00% 1.00% Total cost of medical services 64.30% 71.52% 75.98% 84.54% 83.03% 83.45% 78.93% PNP 2020F 2021F 2022F 2023F 2024F 2025F 2026F Cost of physicians Cost of medical personnel Cost of medicine and medical supplies Cost of chemical supplies Depreciation and amortization expenses Cost of outside lab Cost of hemodialysis Cost of patient food Cost of supplies Other costs Total cost of medical services % to revenue from medical services Capital Advantage Company Limited Page 78/89

79 PNP 2020F 2021F 2022F 2023F 2024F 2025F 2026F Cost of physicians 21.60% 21.60% 21.60% 21.60% 21.60% 21.60% 21.60% Cost of medical personnel 25.48% 25.48% 24.73% 24.01% 23.81% 23.74% 23.61% Cost of medicine and medical supplies 13.31% 13.31% 12.00% 11.50% 11.50% 11.50% 11.50% Cost of chemical supplies 2.05% 2.05% 2.05% 2.05% 2.05% 2.05% 2.05% Depreciation and amortization expenses 8.94% 7.83% 6.61% 5.02% 5.03% 4.36% 4.26% Cost of outside lab 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% Cost of hemodialysis 0.62% 0.62% 0.62% 0.62% 0.62% 0.62% 0.62% Cost of patient food 2/ 1.59% 1.59% 1.59% 1.59% 1.59% 1.59% 1.59% Cost of supplies 1.70% 1.70% 1.70% 1.70% 1.70% 1.70% 1.70% Other costs 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% Total cost of medical services 76.16% 75.07% 71.79% 68.98% 68.78% 68.05% 67.82% Remark: 1/ Internal financial statement of PNP. 2/ Percentage cost of food to revenue from IPD. In and the first half of 2017, cost of medical services was Baht million, Baht million, Baht million, and Baht million, respectively, or accounted for 64.30%, 71.52%, 75.98% and 84.54% of revenue from medical services, respectively. Cost of medical services to revenue from medical services was increased due to PNP1 and PNP2 have been under renovation and construction, and recruiting more physicians and medical personnel as well as increasing in depreciation expenses from new assets. Key assumptions on cost of medical services were as follows: - Cost of physicians in was estimated at 24.12% of revenue from medical services, based on the percentage of cost of physicians to revenue from medical services in the first half of This is due to PNP is under construction and renovation of buildings and recruitment of medical specialists. In , cost of physicians was estimated at 21.60% of revenue from medical services, which was equivalent to the average percentage of cost of physicians to revenue from medical services in and the first half of Cos of medical personnel in was estimated at 25.48% of revenue from medical services, based on the average percentage of cost of medical personnel to revenue from medical services in 2016 and the first half of Besides, in , salary and employee expenses for medical personnel were assumed to increase by 6% per annum, resulting from economy of scale from sharing of medical personnel between PNP1 and PNP2. - Cost of medicine and medical supplies in was assumed at 13.31% of revenue from medical services, which was equivalent to the average percentage of cost of medicine and medical supplies to revenue from medical services in 2016 and the first half of In , cost of medicine and medical supplies was estimated at 11.50% % of revenue from medical services. Cost of medicine and medical supplies was expected to decrease due to economy of scale and cost controlling policy of PNP. - Cost of chemical supplies was estimated at 2.05% of revenue from medical services, which was equivalent to the percentage cost of chemical supplies to revenue from medical services in 2016 and the first half of Cost of outside labs was estimated at 0.43% of revenue from medical services, which was equivalent to the percentage cost of outside labs to revenue from medical services in 2016 and the first half of Cost of supplies was estimated at 1.70% of revenue from medical services, which was equivalent to the percentage cost of outside labs to revenue from medical services in 2016 and the first half of Cost of patient food was estimated at 1.59% of revenue from IPD, which was equivalent to the percentage cost of patient food to revenue from IPD in 2016 and the first half of Cost of hemodialysis was estimated at 0.62% of revenue from medical services, which was equivalent to the percentage cost of hemodialysis to revenue from medical services in the first half of 2017 which should reflect current cost structure of hemodialysis as PNP has been realized of revenues and expenses from hemodialysis in Other expenses were estimated at 1.00% of revenue from medical services, which was equivalent to the percentage of other expenses to revenue from medical services in 2016 and the first half of Other incomes Other incomes consisted of interest incomes, rental incomes, revenue from other services, gain from sale of assets and other incomes. Capital Advantage Company Limited Page 79/89

80 In and the first half of 2017, other incomes were Baht 1.72 million, Baht 2.53 million, Baht 2.14 million and Baht 4.15 million, respectively, or accounted for 0.42%, 0.66%, 0.46% and 2.06% of revenue from medical services, respectively. Key assumptions on other incomes were as follows: - Rental incomes in 2017 were estimated at Bath 0.81 million, which was equivalent to the annualized rental income of the first half of In , rental incomes were expected to increase by 3% per annum based on standard growth of rental fee. - Interest income in 2017 was assumed at 0.14% of revenue from medical services, which was equivalent to average percentage of interest income to revenue from medical services in and the first half of In , interest income was assumed at 0.75% of average cash and cash equivalent. Based on our financial forecasts, PNP would need to seek for financial supports to finance its investment plan and working capital need. Thus, interest income would be decreased. - Other incomes were assumed at 1.03% revenue from medical services, which was equivalent to average percentage of other incomes to revenue from medical services in and the first half of (Unit: Baht million) PNP 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Rental incomes Interest incomes Gain from sales of assets Gain from investments Other incomes Total other incomes % to revenue from medical services Rental incomes 0.09% 0.20% 0.15% 0.20% 0.19% 0.15% 0.13% Interest incomes 0.05% 0.15% 0.13% 0.14% 0.14% 0.14% 0.02% Gain from sales of assets 0.04% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% Gain from investments 0.24% 0.30% 0.00% 0.00% 0.00% 0.00% 0.00% Other incomes 0.38% 1.18% 0.18% 1.73% 1.03% 1.03% 1.03% Total other incomes 0.42% 0.66% 0.46% 2.06% 1.35% 1.32% 1.18% PNP 2020F 2021F 2022F 2023F 2024F 2025F 2026F Rental incomes Interest incomes Gain from sales of assets Gain from investments Other incomes Total other incomes % to revenue from medical services Rental incomes 0.11% 0.10% 0.09% 0.09% 0.08% 0.08% 0.08% Interest incomes 0.02% 0.05% 0.01% 0.02% 0.01% 0.01% 0.02% Gain from sales of assets 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Gain from investments 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Other incomes 1.03% 1.03% 1.03% 1.03% 1.03% 1.03% 1.03% Total other incomes 1.16% 1.17% 1.13% 1.13% 1.12% 1.12% 1.13% Remark: 1/ Internal financial statement of PNP. Selling and administrative expenses Selling and administrative expenses consisted of employee expenses, repair and maintenance expenses, consulting and professional fees, utility expenses, marketing expenses, office supplies, depreciation and amortization expenses, cleaning expenses, insurance expenses, bank fees, doubtful account and other expenses. (Unit: Baht million) PNP 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Employee and management n.a expenses Marketing expenses n.a Utility expenses n.a Repair and maintenance expenses n.a Cleaning and security services n.a Management fee n.a Consulting and professional fees n.a Bank fee n.a Depreciation and amortization expenses n.a Doubtful accounts n.a Other expenses n.a Total selling and administrative expenses Capital Advantage Company Limited Page 80/89

81 PNP 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F % to revenue from medical services Employee and management n.a % 9.47% 11.17% 10.71% 8.94% 7.83% expenses Marketing expenses n.a. 1.33% 0.64% 1.32% 2.00% 2.00% 1.00% Utility expenses n.a. 3.17% 3.86% 4.29% 4.06% 4.06% 4.06% Repair and maintenance expenses n.a. 2.61% 2.07% 3.14% 2.50% 2.50% 2.50% Cleaning and security services n.a. 0.78% 0.88% 5.08% 4.55% 4.18% 3.54% Management fee n.a. 0.84% 0.02% 0.00% 0.00% 0.00% 0.00% Consulting and professional fees n.a. 0.53% 1.02% 0.94% 0.87% 0.71% 0.60% Bank fee n.a. 0.19% 0.22% 0.18% 0.16% 0.13% 0.11% Depreciation and amortization expenses n.a. 2.38% 2.99% 3.76% 3.47% 4.07% 3.48% Doubtful accounts n.a. 0.00% 0.74% 0.04% 0.26% 0.26% 0.26% Other expenses n.a. 1.28% 1.74% 3.62% 1.65% 1.55% 1.48% Total selling and administrative expenses 19.62% 23.34% 23.66% 33.54% 30.22% 28.41% 24.87% % growth of SG&A n.a % 22.19% n.a % 17.59% 5.92% PNP 2020F 2021F 2022F 2023F 2024F 2025F 2026F Employee and management expenses Marketing expenses Utility expenses Repair and maintenance expenses Cleaning and security services Management fee Consulting and professional fees Bank fee Depreciation and amortization expenses Doubtful accounts Other expenses Total selling and administrative expenses % to revenue from medical services Employee and management 6.84% 6.11% 5.93% 5.76% 5.71% 5.69% 5.66% expenses Marketing expenses 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% Utility expenses 4.06% 4.06% 3.81% 3.58% 3.43% 3.31% 3.18% Repair and maintenance expenses 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% Cleaning and security services 2.99% 2.58% 2.42% 2.27% 2.18% 2.10% 2.02% Management fee 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Consulting and professional fees 0.51% 0.44% 0.41% 0.39% 0.37% 0.36% 0.34% Bank fee 0.10% 0.08% 0.08% 0.07% 0.07% 0.07% 0.06% Depreciation and amortization expenses 2.66% 2.33% 1.96% 1.49% 1.49% 1.29% 1.27% Doubtful accounts 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% Other expenses 1.42% 1.38% 1.36% 1.34% 1.33% 1.33% 1.32% Total selling and administrative expenses 22.34% 20.74% 19.74% 18.66% 18.35% 17.91% 17.61% % growth of SG&A 8.97% 10.26% 3.94% 3.26% 5.09% 3.76% 4.85% Remark: 1/ Internal financial statement of PNP. In and the first half of 2017, selling and administrative expenses were Baht million, Baht million, Baht million and Baht million, respectively, or accounted for 19.62%, 23.34%, 23.66% and 33.54% of revenue from medical services, respectively. Selling and administrative expenses were increased by 12.15% in 2015 and 22.19% in The increase of Selling and administrative expenses in 2016 was mainly due to the increase in employee expenses, depreciation expenses and utility expenses. Key assumptions on selling and administrative expenses were as follows: - Employee and management expenses in 2017 was equivalent to the annualized of those expenses in the first half of 2017, and estimated bonus at around 8% of salary that was equivalent to percentage of bonus to salary in Employee and management expenses in were expected to increase by 6% per annum based on PNP s policy. - Marketing expenses in were estimated at 2.00% of revenue from medical services. Marketing expenses in were estimated at 1.00% of revenue from medical services, which was equivalent to average percentage of marketing expenses to revenue from medical services in Utility expenses in 2017 were equivalent Baht million, based on the annualized of utility expenses in the first half of In , utility expenses were estimated at 4.06% of revenue from medical services, which was equivalent to average percentage of utility expenses to revenue from medical services in 2016 and the first half of After that in , utility expenses were estimated to increase by 2.5% per annum based on estimated inflation rate. Capital Advantage Company Limited Page 81/89

82 - Repair and maintenance expenses were assumed at 2.50% of revenue from medical services, which was equivalent to average percentage of repair and maintenance expenses to revenue from medical services in and the first half of Security and cleaning expenses in 2017 were estimated at Baht million or around Baht 1.60 million per month based on information from PNP. It was assumed that security and cleaning expenses in 2018 would increase by 15% from the prior year after the completion of new buildings at PNP1. In , security and cleaning expenses were expected to increase by 2.5% per annum based on estimated inflation rate. - Other expenses were assumed at the average percentage of such expenses to revenue from medical services in and the first half of Financial costs Financial costs consist of interest expenses for short-term loans and long-term loans from financial institution and liabilities under financial lease. Interest rate on loan was referenced to MLR and adjusted with discount percentage based on term and conditions of the loan agreements. In addition, CapAd assumed that in PNP would require short-term financing to support its working capital needs and repayment of long-term loans. Corporate income taxes Corporate income tax rate of 20% was assumed. Capital Expenditure Capital expenditure in 2017 was estimated at Baht 284 million, based on PNP s budget, consisted of purchase of land next to PNP1 of Baht 72 million, renovation and construction of buildings at PNP1 of Baht 182 million, and the remaining of Baht 30 million for medical equipment and other assets. Capital expenditure in 2018 was estimated at Baht 84 million, based on the budget of PNP. In , capital expenditures for medical equipment and other assets were assumed at 3% of revenue from medical services according to PNP s projection based on experience in private hospital operation of management team and equivalent to average capital expenditure of industry at around 3% - 4% of revenue from medical services Assets and liabilities turnover Based on historical data of and the first half of 2017, key working capital turnovers are as follows: Trade and other account receivables 39 days on average Inventory 9 days on average Trade and other payables 52 days on average Summary of financial projection of is as follows; (Unit: Baht million) PNP 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Revenue from medical , , , , , services Cost of medical services (361.90) (455.04) (520.77) (609.68) (713.80) (745.40) (782.11) (833.67) (876.75) (931.43) Gross profit Total revenues , , , , , EBITDA EBIT (51.87) (57.49) (17.31) Net profit (89.14) (92.41) (51.26) (11.61) PNP 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Statement of Financial Position Total assets 1, , , , , , , , , , Total liabilities Shareholders equity 1, , , , , Terminal Value Free cash flow growth after the forecasting period was estimated at 2% per annum. Discount Rate Please see details of assumption in Part 3 Clause 5.1 of this report. Capital Advantage Company Limited Page 82/89

83 Therefore, the discount rate or WACC is equal to 9.50% % per annum. By using above information and assumptions, calculation of PNP s future cash flow and value are as follows; (Unit: Baht million) PNP 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Free Cash Flow to (267.50) (80.13) Firm (FCFF) Present Value of FCFF (263.48) (72.08) PNP (Baht million) Total PV of FCFF PV of Terminal Value 1, Present Value of Free Cash Flow 1, Add: Cash and cash equivalents as of December 31, / Add: Current investment as of December 31, / Less: Interest bearing debts as of December 31, 2016 (851.21) 2/ Add: Capital increase / Net Present Value of Free Cash Flow as of November 1, , Remark: 1/ Cash and cash equivalents were Baht million, and current investments were Baht 3.09 million, based on financial statements of PNP as of December 31, 2016, audited by a certified auditor approved by the SEC. 2/ Interest bearing debts consisted of long-term loans from financial institution of Baht million, liabilities under financial lease of Baht million, and loan from related party of Baht 35 million, based on financial statements of PNP as of December 31, 2016, audited by a certified auditor approved by the SEC. 3/ The 2017 Annual General Meeting of Shareholders of PNP, held on April 26, 2017, resolved to approve the increase of registered capital from 1,770,830 shares to 3,541,660 shares by issuing right offering of 1,770,830 new ordinary shares at par value of Baht 100 each to its existing shareholders at the ratio of 1 exiting share to 1 new share at the offering price of Baht per share. In June 2017, PNP received the capital increase from its existing shareholders in total of Baht million, and registered the capital increase to the Ministry of Commerce in August The fair value of PNP based on this approach is equal to Baht 1, million. In addition, CapAd has conducted a sensitivity analysis by adjusting the discount rate or WACC 24 increased (decreased) by 2.50% of the calculated discount rate mentioned above. PNP Unit Discount Rate (% per annum) 9.74% % 9.50% % 9.26% % NPV of Free Cash Flow of PNP Baht million 1, , , As shown in the table above, the fair value of PNP is in the range of Baht 1, , million. 24 Please see Footnote 22. Capital Advantage Company Limited Page 83/89

84 5.4 Alliance Medical Asia Company Limited ( AMA ) AMA is a holding company, currently holding shares directly in two subsidiaries, namely PSV and PNP, and indirectly in three subsidiaries, namely SHV, PUH and PNPH. Majority of revenues of AMA derives from dividend, but AMA still has administrative expenses. However, in preparation of financial forecast, CapAd constructed cash flows projections of the companies that AMA invested in as stated in Part 3 Clause of this report. Thus, cash flow projection of AMA (company only) was consisted of administrative expenses. In this financial forecast of AMA, CapAd considered financial information of 2016 and the first half of 2017, which was the period after AMA increased its registered and paid-up capital from Baht 28 million to Baht 2, million and invested in PSV and PNP. Financial information from such period should reflect current shareholding structure and operation of AMA better than those of The assumptions for AMA s financial forecast can be summarized as follows: Administrative expenses In and the first half of 2017, administrative expenses were Baht million, Baht million, Baht million and Baht million, respectively. Details are as follows: (Unit: Baht million) AMA 2014A 2015A 2016A 1H2017A 1/ 2017F 2018F 2019F Employee expenses Consulting and professional fees Travelling expense Other expenses Total administrative expenses % growth of expenses Employee expenses n.a % % n.a % 5.75% 5.76% Consulting and professional fees n.a % % n.a % % 2.50% Travelling expense n.a % % n.a % 2.50% 2.50% Other expenses n.a % % n.a % 2.50% 2.50% Total administrative expenses n.a % 28.11% n.a % % 4.33% AMA 2020F 2021F 2022F 2023F 2024F 2025F 2026F Employee expenses Consulting and professional fees Travelling expense Other expenses Total administrative expenses % growth of expenses Employee expenses 5.76% 5.77% 5.78% 5.79% 5.79% 5.80% 5.80% Consulting and professional fees 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% Travelling expense 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% Other expenses 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% 2.50% Total administrative expenses 4.36% 4.39% 4.42% 4.45% 4.48% 4.51% 4.54% Remark: 1/ Internal financial statement of AMA. In this financial forecast, CapAd assumed that administrative expenses of 2017 were equivalent to the annualized of such expenses in January July 2017 derived from internal financial information of AMA. In , employee expenses were expected to increase by 6% per annum and other expenses were expected to increase by 2.5% per annum based on estimated inflation rate. Consulting and professional fees of 2017 were estimated at Baht million based on the actual fees in January July 2017 and the consulting and professional fees for August December 2017 were assumed. Consulting and professional fees in and the first half of 2017 were rather high due to AMA has entered into number of transactions in relation to acquisition of investments in subsidiaries including entering into this transaction with the Company. However, in , CapAd assumed that AMA would not have significant acquisition/disposition of assets or investment transactions. Therefore, consulting and professional fees would derive from normal activities such as audit fee and legal fee, totaling of approximately Baht 1.13 million and increase by 2.5% per annum based on estimated inflation rate. Capital Advantage Company Limited Page 84/89

85 Terminal Value Free cash flow growth after the forecasting period was estimated at 2% per annum. Discount Rate Please see details of assumption in Part 3 Clause 5.1 of this report. Therefore, the discount rate or WACC is equal to 9.50% % per annum. By using above information and assumptions, calculation of AMA s future cash flow and value are as follows; (Unit: Baht million) AMA 2017F 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F Free Cash Flow to / (3.87) (4.04) (4.21) (4.40) (4.59) (4.80) (5.01) (5.24) (5.47) Firm (FCFF) Present Value of FCFF 7.08 (3.45) (3.29) (3.14) (2.99) (2.85) (2.71) (2.59) (2.46) (2.35) Remark: 1/ Consisted of dividend from PSV of Baht 36 million and other incomes of Baht 2.84 million, net of administrative expenses of Baht million. AMA (Baht million) Total PV of FCFF (18.74) PV of Terminal Value (31.18) Present Value of Free Cash Flow (49.93) Add: Cash and cash equivalents as of December 31, / Less: Interest bearing debts as of December 31, 2016 (34.06) 2/ Less: Capital increased in PNP (407.90) 3/ Less: Purchased of PNP shares from Miss Satita (16.55) 4/ Net Present Value of Free Cash Flow as of November 1, 2017 (506.10) Remark: 1/ Cash and cash equivalents were Baht 2.34 million based on financial statements of AMA as of December 31, 2016, audited by a certified auditor approved by the SEC. 2/ Interest bearing debts consisted of short-term loans from related party of Baht million, based on financial statements of AMA as of December 31, 2016, audited by a certified auditor approved by the SEC. 3/ In June 2017, AMA, as a shareholder of PNP, subscribed to 1,631,583 shares of PNP at the par value of Baht 100 each with the acquisition price of Baht 250 per share, or total acquisition price of newly issued ordinary shares of PNP by Baht million. Shareholding percentage of AMA in PNP as of June 30, 2017 has increased to 89.05% of the registered and paid up capital of PNP. 4/ On August 28, 2017, AMA purchased 66,218 shares of PNP from Miss Satita at the purchase price of Baht 250 per share, or totaling of Baht million. Therefore, shareholding percentage of AMA in PNP has increased to 90.92% of the registered and paid up capital of PNP. The fair value of AMA based on this approach is equal to Baht (506.10) million. In addition, CapAd has conducted a sensitivity analysis by adjusting the discount rate or WACC 25 increased (decreased) by 2.50% of the calculated discount rate mentioned above. AMA Unit Discount Rate 9.74% % 9.50% % 9.26% % NPV of Free Cash Flow of AMA Baht million (504.27) (506.10) (508.05) As shown in the table above, the fair value of AMA is in the range of Baht (504.27) (508.05) million. 25 Please see Footnote 22. Capital Advantage Company Limited Page 85/89

86 5.5 Feasibility study of Pitsanuvej Uttaradit Hospital PSV has planned to invest in new hospital in Uttaradit Province through the investment in Pitsanuvej Uttaradit Hospital Company Limited (PUH). At the present, PSV has already acquired plots of land totaling rai in Muang Uttaradit District, Uttaradit Province. PSV oversaw investment opportunity in private hospital in Uttaradit due to there is no private hospital in Uttaradit Province. However, PSV is under feasibility study of Pitsanuvej Uttaradit Hospital ( PUH Project ). Therefore, construction period, project cost and details of PUH Project in the future may differ from this financial forecast of the PUH Project by CapAd. This feasibility study was based on the financial projection of Pitsanuvej Uttaradit Hospital prepared by AMA while CapAd revised some assumptions. If the characteristics, details, and estimated budgets of the project were different from this feasibility provided to CapAd, NPV and IRR of the project may differ from our estimation this time. However, this feasibility study of Pitsanuvej Uttaradit Hospital is for information to shareholders of the Company only. Main assumptions for Pitsanuvej Uttaradit Hospital can be summarized as follows: PUH Amount 1 Business type General hospital 2 Registered bed 56 beds 3 OPD capacity 350 times per day 4 Construction period 1 year 5 Launching period Sources of fund 50 : 50 (Loan : Equity) 7 Project costs Baht million, consisted of - Land Baht: 44 million - Buildings: Baht 300 million - Medical equipment: Baht 60 million - IT system: Baht 10 million - Financial costs: Baht 8.54 million 8 Revenue from medical services - No. of OPD visits Average No. of OPD visits Year 1 = 110 times per day Average No. of OPD visits Year 2: increase by 25% per annum Average No. of OPD visits Year 3: increase by 20% per annum Average No. of OPD visits Year 4: increase by 15% per annum Average No. of OPD visits Year 5: increase by 10% per annum Average No. of OPD visits Year 6-10: increase by 5% per annum - Average OPD revenue Average OPD revenue Year 1 = Baht 1,750 per time Average OPD revenue Year 2 5: increase by 5% per annum Average OPD revenue Year 6 10: increase by 3% per annum - No. of IPD patients Average No. of IPD patients Year 1 = 9.90 patients per day Conversion Ratio: 9% Length of stay: 2.30 days - Average IPD revenue Average IPD revenue Year 1 = Baht 8,500 per day Average IPD revenue Year 2 5: increase by 5% per annum Average IPD revenue Year 6 10: increase by 3% per annum 9 Cost of medical services 62.61% 66.83% of revenue from medical services 10 Selling and administrative expenses 23% - 32% of revenue from medical services 11 CapEx 3% of revenue from medical services 12 Terminal growth 2% per annum 13 Discount rate of WACC 9.50% 9.68% per annum Please see assumptions in Part 3 Clause 5.1 of this report By using above information and assumptions, calculation of Pitsanuvej Uttaradit Hospital s future cash flow and value are as follows; (Unit: Baht million) PUH 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F 2027F 2028F Free Cash Flow to (347.83) 1/ (17.63) Firm (FCFF) Present Value of FCFF (340.53) (15.86) Remark: 1/ Excluding cost of land around Baht 44 million (11 rai) that was purchased by PSV in Pitsanuvej Uttaradit Hospital Amount PV of FCFF (168.13) Baht million PV of Terminal Value Baht million Project NPV Baht million Project IRR 9.85 % per annum Payback period Years Capital Advantage Company Limited Page 86/89

87 Conclusively, from feasibility study of Pitsanuvej Uttaradit Hospital based on the preliminary plan of AMA, CapAd found that the project was feasible under current circumstances and economic conditions while the internal rate of return of the project was slightly higher than WACC of AMA Group. However, our analysis was based on preliminary investment plan prepared by the Company and AMA. The actual investment of the project in the future should be considered and approved by the Board of Directors Meeting of the Company. 5.6 Summary firm value of AMA Please see financial forecasts of AMA, PSV, SHV and PNP in Clause mentioned above. Summary of firm value of AMA from its direct investment in 2 companies and indirect investment in 3 companies is as follows: Company Firm value (Baht million) (1) AMA s shareholding - net (%) (2) Firm value to AMA (Baht million) (3) = (1) * (2) 1 Alliance Medical Asia Company Limited (504.27) (508.05) (504.27) (508.05) (AMA) 2 Pitsanuloke Medical Company Limited 2, , , , (PSV) 3 Union Pichit Doctors Company Limited (SHV) 4 Paknampo Hospital Company Limited (PNP) 1, , , , P.N.P Hospital Company Limited n.a. 1/ n.a. (PNPH) 6 Pitsanuvej Uttaradit Hospital Company n.a. 1/ n.a. Limited (PUH) 7 Pitsanuvej Pattana Company Limited n.a. 2/ n.a. (PPC) Total 3, , , , No. of paid-up shares as of December 31, 2016 (million shares) / Present value of cash flows per share (Baht per share) / Remark: 1/ CapAd did not construct financial forecast for these companies due to they have no business operation at the present and no significant assets. 2/ CapAd did not construct financial forecast for these companies due to they have no business operation at the present while the plots of land owned by PPC have been included in the financial forecast of PSV. 3/ Comprising of 1,372,000 preferred shares and 267,003,000 ordinary shares at par value at Baht each, according to pro-forma financial statement of AMA as of December 31, / Preferred shares are entitled to receive dividend at the rate of 4 times over the dividend paid to the ordinary shareholders in the year that a dividend is declared. Upon dissolution of AMA, the preferred shareholders are entitled to the return of paid-up amount of each preferred shares and the premium on preferred shares in preference to the common shareholders. If there is remaining capital after the common shareholders receive the paid-up amount of each ordinary share, the preferred shareholders are entitled to 4/5 of the remaining capital and the common shareholders are entitled to the remaining amount after the preferred shareholders. However, in this Transaction, the Company will acquire % of registered and paid-up capital of AMA. CapAd, therefore, shall consider fair value of ordinary shares and preferred shares in the same basis (class) and shall not consider term and conditions of the preferred shares. The value of AMA s shares based on this approach is equal to Baht per share 26 or equivalent to firm value of AMA of Baht 2, , million. Please note that financial projection is based on assumptions provided by AMA and under the current economic conditions and circumstance. If there is any change in the business plan and policy of AMA Group as well as government s policies including economic condition that will materially affect the assumptions and variables used herein, the future operating results of AMA Group might not be as projected and the value of AMA Group may also change accordingly. 26 Please see Footnote 8. Capital Advantage Company Limited Page 87/89

88 6. Summary of Opinion of the IFA on the Appropriateness of the Acquisition Price the table below; AMA The value of AMA s shares derived from various valuation approaches can be summarized in Firm Value of AMA (Baht million) Acquisition Price of AMA (Baht million) Higher (Lower) than the Acquisition Price of AMA (Baht million) Higher (Lower) than the Acquisition Price of AMA (%) (1) (2) (3) = (1) (2) (4) = (3)/(2) Appropriateness of the Valuation Approach Book Value Approach 2, , Inappropriate Adjusted Book Value Approach 1, , (296.24) Inappropriate Market Value Approach n.a. 2, n.a. n.a. Unable to evaluate P/BV Ratio Approach 13, , , Inappropriate 14, , P/E Ratio Approach 2, , , Inappropriate Discounted Cash Flow Approach 2, , , Appropriate From the summary table above, the firm value of AMA is in the range of Baht 1, , million. The Book Value Approach reflects the operating result and financial position of AMA at any given period by considering historical performance without taking into account its real asset value and future profitability, as well as the overall economic and industry outlook. Thus, valuation of AMA s shares using this approach could not reflect the current financial position and fair firm value of AMA. The Adjusted Book Value Approach reflects current market value of AMA s assets better than the Book Value Approach. Share value based on this approach can reflect market value of AMA s assets, tax saving from losses carried forward and event after date of financial statement, which were dividend payments of PSV and SHV and capital increase of PNP. However, this valuation approach does not consider AMA s future profitability, as well as overall economic and industry outlook. Therefore, CapAd viewed that determining value of AMA using this approach might not reflect fair value of AMA. The Market Value Approach is not applied as AMA is not listed on the SET. Thus, market prices of AMA s shares could not be calculated. The Price to Book Value Ratio and the Price to Earnings Ratio Approach estimated value of AMA s shares using book value of AMA as of December 31, 2016 to compare with Price to Book Value Ratio of comparable companies and use the past 12 months net profit as stated in financial statement of AMA as of December 31, 2016 to compare with the past selected industrial average of 20 comparable SET- or MAI-listed companies in health care services sector, services industry who operate private hospital business similar to AMA. The information is for the period up to September 29, However, CapAd viewed that many hospitals in AMA Group have been under construction, and financial position and profitability of AMA Group based on the financial statements might not reflect AMA Group s actual capability. Therefore, using the ratios of those comparable SET- or MAIlisted companies as benchmark for valuation of AMA s share might not reflect fair value of AMA. The Discounted Cash Flow Approach is the method that considers the historical operating results and the future growth prospects. The Discounted Cash Flow Approach calculated future cash flow stream from financial forecast based on an assumptions provided by AMA under the current economic conditions and circumstances. If there is any change in the business plan, policy, and economic condition that will materially affect the assumptions and variables used herein, the future operating results of AMA might not be as projected and the value of the AMA evaluated by this approach may also change accordingly. CapAd is of the opinion that the most appropriate approach to value AMA at the present is the Discounted Cash Flow Approach as it reflects future profitability of AMA under current circumstance. Therefore, CapAd view fair value of AMA s shares is in the range of Baht per share 27, or equivalent to the firm value in the range of Baht 2, , million, which is higher than the acquisition price of AMA s shares by Baht , or higher than the acquisition price of AMA s shares by 9.15% 22.95%. Conclusively, CapAd is of the opinion that the acquisition price of AMA s ordinary shares is appropriate as the acquisition price of AMA s ordinary shares is lower than fair value of AMA s shares determined by the Independent Financial Advisor. 27 Please see Footnote 8. Capital Advantage Company Limited Page 88/89

89 Part 4: Conclusion of the Opinion of the Independent Financial Advisor Concerning the Acquisition of Assets Please see the conclusion of the Independent Financial Advisor s opinion in the Executive Summary on Page 6 of this report. However, the final decision shall be at own discretion of the shareholders. The shareholders should consider the information in the notice to the shareholders meeting and its enclosures before making the decision. CapAd as the Independent Financial Advisor hereby certifies that the opinions have prudently been provided in compliance with the professional standards, with due regard to the shareholders benefits. Yours sincerely, Capital Advantage Company Limited -Patchara Netsuwan- (Mr. Patchara Netsuwan) Managing Director -Patchara Netsuwan- (Mr. Patchara Netsuwan) Supervisor in Charge Capital Advantage Company Limited Page 89/89

90 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Attachment 1 Business Overview and Operating Results of Alliance Medical Asia Company Limited and Subsidiaries 1. General Information Company Name : Alliance Medical Asia Company Limited ( AMA ) Main Business : Holding Company Head Office : 29 Bangkok Business Center, 23 rd floor, Soi Sukhumvit 63 (Ekamai) Sukhumvit Road, Klongton Nua Sub-district, Wattana District, Bangkok Registered Capital : Baht 2,683,750,000 Divided into 1,372,000 preferred shares and 267,003,000 ordinary shares at par value of Baht 10 each Paid-up Capital : Baht 2,683,750,000 Divided into 1,372,000 preferred shares and 267,003,000 ordinary shares at par value of Baht 10 each 2. Nature of Business Alliance Medical Asia Co., Ltd. was incorporated on February 20, 2013 to be a holding company. It holds shares in the companies that provide medical services and operate hospital business. AMA invested directly in 2 subsidiaries and indirectly in 4 companies. The details are shown in the following table. Company Registered Paid up Capital % of investment Capital (Baht) (Baht) 1. Pitsanuloke Medical Co., Ltd. (PSV) 125,000, ,000,000 60% 2. Union Pichit Doctors Co., Ltd. (SHV) 100,000, ,000, % invested via PSV 3. Pitsanuvej Uttaradit Hospital Co., Ltd. (PUH) 1,000,000 1,000, % invested via PSV 4. Pitsanuvej Pattana Co., Ltd. (PPC) 1,000,000 1,000, % invested via PSV 5. Paknampo Hospital Co., Ltd. (PNP) 354,166, ,166, % 6. P.N.P Hospital Co., Ltd. (PNPH) 150,000,000 37,500, % invested via PNP 3. Board of Directors List of Board of directors of AMA as of June 6, 2017 is as follows: Names Position 1. Ms. Satita Viddayakorn Director 2. Ms. Atiya Arwatchanakarn Director Remark: The authorization of AMA is the signatures of both directors. Source: the Company s affidavit. Alliance Medical Asia Group Structure Alliance Medical Asia (AMA) 60.00% 90.92% Pitsanuloke Medical Co., Ltd. (PSV) Union Pichit Doctors Co., Ltd. (SHV) Pitsanuvej Uttaradit Hospital Co., Ltd. (PUH) 99.99% 99.99% Paknampo Hospital Co., Ltd. (PNP) 99.99% P.N.P Hospital Co., Ltd. (PNPH) Pitsanuvej Pattana Co., Ltd. (PPC) 99.99% Attachment 1 - Page 1

91 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited 4. Shareholder Structure As of May 12, 2017 AMA has registered and paid-up capital of Baht 2,683,750,000 divided into 267,003,000 ordinary shares and 1,372,000 preferred shares at par value of Baht 10 each. The details are as follows: Name Ordinary shares Preferred share Total shares % shareholding (shares) (shares) (shares) 1. Ms. Satita Viddayakorn 146,852,400 1/ - 146,852, Vantage Point Management Limited 118,750,600 1,372, ,122, Mr. Sirichai Towiriyawate 1,400,000 2/ - 1,400, Total 267,003,000 1,372, ,375, Source: BorAorJor 5. Remark: 1/ In this transaction, Ms. Satita will sell 146,825,399 ordinary shares, remaining only 1 share held in AMA. 2/ In this transaction, Mr. Sirichai will sell 1,399,999 ordinary shares, remaining only 1 share held in AMA. In order to have 3 shareholders to comply with the Civil and Commercial Code. 5. Summary of Financial Positions and Operation Results The key financial figures of AMA for the year are as follows: Financial statement for the company only Dec. 31, / Dec. 31, 2015 Dec. 31, 2016 (Unit: Baht thousand) Current assets 5, , , Non-current assets 69, , ,723, Total assets 74, , ,748, Current liabilities 3, , , Non-current liabilities Total liabilities 3, , , Issued and paid-up capital 28, , ,683, Premium on preferred share 42, , , Retained earnings (loss) 1, (5,926.96) (11,218.33) Total shareholders equity 71, , ,714, Total liabilities and shareholders equity 74, , ,748, Total revenues 17, , , Total expenses (15,220.52) (10,284.31) (13,174.75) Profit (loss) before financial cost and income tax 1, (2,258.36) (2,496.68) Financial costs - (5,095.54) (2,794.69) Profit (loss) before income tax 1, (7,353.90) (5,291.37) Income tax (374.44) - - Net profit (loss) for the year 1, (7,353.90) (5,291.37) Source: Financial statement of AMA for the year ended December 31, 2014 was audited by a certified auditor who is not in the approved list of the SEC. Financial statement of AMA for the year ended December 31, 2015 and 2016 were audited by Pricewaterhouse Coopers ABAS which is the auditor in the approved list of the SEC. Remark: 1/ Financial performance in 2014 was from the incorporation date (February 20, 2014) to December 31, Please see the Pro-forma Financial Statement of AMA in Part 2 Clause 2 of this report Attachment 1 - Page 2

92 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Business Overview and Operating Result of Pitsanuloke Medical Company Limited 1. General Information Company Name : Pitsanuloke Medical Company Limited ( PSV ) Main Business : Hospital Head Office : 211 Khun Pirenthorathep Road, Nai Muang Sub-district, Muang Pitsanuloke District, Pitsanuloke Province Registered Capital : Baht 125,000,000 Divided into 125,000 ordinary shares at par value of Baht 1,000 each Paid-up Capital : Baht 125,000,000 Divided into 125,000 ordinary shares at par value of Baht 1,000 each 2. Nature of Business Pitsanuloke Medical Co., Ltd. was incorporated on September 4, 1981 to operate Pitsanuvej Hospital which is the first private hospital in the lower northern region. The hospital is located in Muang District, Pitsanuloke Province. It has been opened since 1982 with 50 registered beds. Later in 1995, the hospital increased its capacity to 150 registered beds. In 2012, the hospital became Joint Commission International (JCI) accredited. Until now, the hospital has been operating for 35 years. Pitsanuvej Hospital provides upper secondary care with various medical services consisting of Internal Medicine Clinic, Pediatrics Clinic, Obstetrics and Gynecology Clinic, Surgical Clinic, Health Check-up Center, Psychiatric Clinic, Children and Adolescents Development Clinic, Eye Clinic, Ear, Nose, and Throat Clinic, Dental Center and other services such as Radiology, Heart Examination, Laboratory and Surgical examination. 3. Board of Directors List of PSV s 7 directors on July 4, 2017 is as follows: Name Position 1. Mrs. Nipaporn Nimpitakpong Director 2. Ms. Wansiri Nimpitakpong Director 3. Ms. Khongchanok Thirawarakan Director 4. Mr. Pongsak Viddayakorn Director 5. Mrs. Piyarat Ukrit Director 6. Mr. Satit Viddayakorn Director 7. Mr. Athiwat Noiprasit Director Remark: The authorization of PSV is the signatures of Mr. Pongsak Viddayakorn or Mr. Satit Viddayakorn co-signs with Mrs. Nipaporn Nimpitakpong or Ms. Wansiri Nimpitakpong, total 2 directors and affix the company s seal. Source: The company s affidavit. 4. Shareholder Structure As of June 9, 2017, PSV has registered and paid-up capital of Baht 125,000,000 divided into 125,000 ordinary shares at par value of Baht 1,000 each. The details are as follows: Name Number of shares % shareholding 1. Alliance Medical Asia Co., Ltd. 75, Pitakpong Medical Co., Ltd. 1/ 49, Ms. Wansiri Nimpitakpong Total 125, Source: BorAorJor 5. Remark: 1/ Not connected person of PRINC. Pitakpong Medical Co., Ltd. s board of directors is as follows: Name Position 1. Mrs. Nipaporn Nimpitakpong M.D. Director 2. Ms. Piyarat Nimpitakpong Director 3. Ms. Wansiri Nimpitakpong Director 4. Ms. Khongchanok Thirawarakan Director 5. Ms. Thipwarintorn Thirawarakan Director 6. Mr. Satit Nimpitakpong Director 7. Ms. Netraya Nimpitakpong Director Shareholder list of Pitakpong Medical Co., Ltd. is as follows: Name Number of shares % Shareholding 1. Suksangsan Co., Ltd Ms. Khongchanok Thirawarakan Ms. Thipwarintorn Thirawarakan Attachment 1 - Page 3

93 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Name Number of shares % Shareholding 4. Mrs. Nipaporn Nimpitakpong M.D Ms. Netraya Nimpitakpong Ms. Piyarat Nimpitakpong Ms. Wansiri Nimpitakpong Mr. Satit Nimpitakpong Total 1, Source: (as of April 30, 2017). Remark: Par value is Baht 1,000 per share. The registered capital of the company is Baht 1 million. Suksangsan Co., Ltd. s board of directors is as follows: Name Position 1. Mrs. Nipaporn Nimpitakpong M.D. Director 2. Ms. Piyarat Nimpitakpong Director 3. Ms. Wansiri Nimpitakpong Director 4. Ms. Khongchanok Thirawarakan Director 5. Ms. Thipwarintorn Thirawarakan Director 6. Mr. Satit Nimpitakpong Director 7. Ms. Netraya Nimpitakpong Director Shareholder list of Suksangsan Co., Ltd. is as follows: Name Number of shares % Shareholding 1. Mrs. Nipaporn Nimpitakpong M.D. 10, Ms. Khongchanok Thirawarakan 1, Ms. Thipwarintorn Thirawarakan 1, Ms. Netraya Nimpitakpong 1, Ms. Piyarat Nimpitakpong 1, Ms. Wansiri Nimpitakpong 1, Mr. Satit Nimpitakpong 1, Total 20, Source: (as of April 30, 2017) Remark: Par value is Baht 1,000 per share. The registered capital of the company is Baht 20 million 5. Summary of Financial Positions and Operation Results The key financial figures of PSV for the year are as follows: Financial Statement for the company only Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2016 (Unit: Baht thousand) Restated Restated Total current assets 137, , , Total non-current assets 201, , , Total assets 338, , , Total current liabilities 228, , , Total non-current liabilities 91, , , Total liabilities 320, , , Issued and paid-up capital 50, , , Share premium - 375, , Retained earnings (loss) (31,617.62) (6,682.49) 119, Total shareholders equity 18, , , Total liabilities and shareholders equity 338, , , Total revenues 902, , ,103, Total expenses (818,353.51) (887,057.63) (948,161.24) Profit (loss) before financial costs and income tax 83, , , Financial costs (10,636.94) (5,239.32) (1,148.75) Profit (loss) before income tax 73, , , Income tax (14,785.61) (18,247.77) (27,984.26) Net profit for the year 58, , , Source: Financial statement of PSV for the year ended December 31, 2014 was audited by a certified auditor who is not in the approved list of the SEC. Financial statement of PSV for the year ended December 31, 2015 was audited by Bunchikij Co., Ltd. which is an auditor in the approved list of SEC. Financial statement of PSV for the year ended December 31, 2016 was audited by PricewaterhouseCoopers ABAS Co., Ltd. which is an auditor in the approved list of SEC. Attachment 1 - Page 4

94 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited 6. Hospitals in Pitsanuloke Province Hospital Year of Opening Number of Beds Public Hospitals 1. Buddhachinaraj Hospital / 1,051 2/ 2. Naresuan University Hospital 3/ Fort Somdej Phranaresuan Maharaj Hospital (military hospital) 4/,5/ Wing 46 Airforce Hospital (military hospital) 2/ Private Hospitals 1. Pitsanuvej Hospital 6/ Bangkok Hospital Pitsanuloke* Ruamphat Pitsanuloke Hospital 1985** 100 7/ 4. Pitsanuloke Hospital*** / 50 9/ Remark: Excluded clinics and community hospitals (information as of September 26, 2017). * In 2013, Bangkok Dusit Medical Services PCL. (BDMS) acquired Rattanavej Hospital. BDMS set up Bangkok Hospital Phitsanulok Co., Ltd. as a subsidiary for business transfer of Rattanavej Hospital (which has been operating since 1989), and it was renamed to Bangkok Hospital Phitsanulok in (source: Form 56-1 for the year 2013 of BDMS). ** Year of foundation of Ruamphat Pitsanulok Hospital Co., Ltd. (source: *** In 2015 Everland PCL. (EVER) acquired 53.96% of Pitsanulok Intervejchakan Hospital Co., Ltd. s shares, which has run Inter Vejchakan Hospital since 1997, and the hospital was renamed to Phitsanulok Hospital in October 2016 (source: Form 56-1 for the year 2016 of EVER) Source: 1/ 2/ Information from telephone inquiry from hospital 3 B8%9A%E0%B8%B2%E0%B8%A5%E0%B8%A1%E0%B8%AB%E0%B8%B2%E0%B8%A7%E0%B8%B4%E0%B8%97 %E0%B8%A2%E0%B8%B2%E0%B8%A5%E0%B8%B1%E0%B8%A2%E0%B8%99%E0%B9%80%E0%B8%A3%E0%B8 %A8%E0%B8%A7%E0%B8%A3 4/ 5/ 6/ 7/ 8/ 9/ Attachment 1 - Page 5

95 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Business Overview and Operating Results of Union Pichit Doctors Company Limited 1. General Information Company Name : Union Pichit Doctors Company Limited ( SHV ) Main Business : Hospital Head Office : 2/158 Srimala Road, Nai Muang Sub-district, Muang Pichit District, Pichit Province Registered Capital : Baht 100,000,000 Divided into 985,000 ordinary shares and 15,000 preferred shares at par value of Baht 100 each Paid-up Capital : Baht 100,000,000 Divided into 985,000 ordinary shares and 15,000 preferred shares at par value of Baht 100 each 2. Nature of Business Union Pichit Doctors Co., Ltd. operates Sahavej Hospital, a private hospital with 90-bed located in Muang District, Pichit Province. It was first opened on October 15, Sahavej Hospital currently has 90 registered beds. Sahavej Hospital offers medical services including Orthopedics Center, Emergency Center, Health Check-up Center, Urinary Tract Center, Kidney Center, X-ray Center, Internal Medicine Clinic, General Surgery Clinic, Physical Therapy Center, Pediatrics Center, and Obstetrics and Gynecology Clinic. 3. Board of Directors As of August 9, 2017, SHV has 7 directors as follows: Name Position 1. Mr. Pongsak Viddayakorn Director 2. Mrs. Nipaporn Nimpitakpong Director 3. Mr. Satit Viddayakorn Director 4. Ms. Wansiri Nimpitakpong Director 5. Ms. Khongchanok Thirawarakarn Director 6. Mrs. Piyarat Ukrit Director 7. Mr. Athiwat Noiprasit Director Remark: The authorization of SHV is the signatures of Mr. Pongsak Viddayakorn or Mr. Satit Viddayakorn co-signs with Mrs. Nipaporn Nimpitakpong or Ms. Wansiri Nimpitakpong, total 2 directors and affix the company s seal. Source: The company s affidavit. 4. Shareholder Structure As of June 9, 2017, SHV has registered and paid-up capital of Baht 100,000,000 divided into 985,000 ordinary shares at par value of Baht 100 each and 15,000 preferred shares at par value of Baht 100 each. The shareholders detail is as follows: Name Number of ordinary shares (shares) Number of preferred shares (shares) Total shares (shares) % shareholding 1. Pitsanuloke Medical Co., Ltd. 984,998 15, , Ms. Khongchanok Thirawarakarn Mr. Satit Viddayakorn Total 985,000 15,000 1,000, Source: BorAorJor5. 5. Summary of Financial Positions and Operation Results The key financial figures of SHV for the year are as follows: Financial statement for the company only Sep. 30, 2014 Sep. 30, 2015 Sep. 30, 2016 Dec. 31, / (Unit: Baht thousand) Current assets 51, , , , Non-current assets 50, , , , Total assets 102, , , , Current liabilities 27, , , , Non-current liabilities 12, , , , Total liabilities 40, , , , Issued and paid-up capital 38, , , , Retained earnings 24, , , , Total shareholders equity 62, , , , Total liabilities and shareholders equity 102, , , , Attachment 1 - Page 6

96 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Financial statement for the company only Sep. 30, 2014 Sep. 30, 2015 Sep. 30, 2016 Dec. 31, / (Unit: Baht thousand) Total revenues 135, , , , Total expenses (127,508.77) (145,070.71) (156,022.22) (60,245.38) Profit (loss) before financial costs and income tax 7, , , , Financial cost (144.99) (192.45) (295.67) Profit (loss) before income tax 7, , , , Income tax (1,766.27) (2,075.48) (4,898.66) Net profit for the year 5, , , Source: SHV s financial statements for the year ended September 30, 2014, 2015, 2016 and for 3-month ended December 31, 2016 were audited by a certified auditor who is not in the approved list of SEC. Remark: 1/ Financial statement for 3 months. 6. Hospitals in Pichit Province Hospital Year of Opening Number of Beds Public Hospital 1. Pichit Hospital 1/ Private Hospitals 1. Chaiaroon Vechagarn Hospital /2/ Sahavej Hospital 3/ Thatsanawet Hospital 4/ Srisukho Hospital / 10 4/ Remark: Excluded clinics and community hospitals (information as of September 26, 2017). Source: 1/ A7%E0%B8%B1%E0%B8%95%E0%B8%B4%E0%B9%82%E0%B8%A3%E0%B8%87%E0%B8%9E%E0%B8%A2%E0% B8%B2%E0%B8%9A%E0%B8%B2%E0%B8%A5 2/ 3/ 4/ Information from telephone inquiry with hospital 5/ Attachment 1 - Page 7

97 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Business Overview and Operating Result of Pitsanuvej Uttaradit Hospital Company Limited 1. General Information Company Name : Pitsanuvej Uttaradit Hospital Company Limited ( PUH ) Main Business : Hospital Head Office : 211 Khun Pirenthorathep Road, Nai Muang Sub-district, Muang Pitsanuloke District, Pitsanuloke Province Registered Capital : Baht 1,000,000 Divided into 100,000 ordinary shares at par value of Baht 10 each Paid-up Capital : Baht 1,000,000 Divided into 100,000 ordinary shares at par value of Baht 10 each 2. Nature of Business Pitsanuvej Uttaradit Hospital Co., Ltd. was established on June 2, 2017 to operate private hospital business. Pitsanuloke Medical Co., Ltd (PSV) is a major shareholder with % shareholding. PSV acquired land in Muang District, Uttaradit Province with Pitsanuvej Uttaradit Hospital project development plan in the future. 3. Board of Directors As of June 2, 2017, PUH has 3 directors as follows: Name Position 1. Mr. Satit Viddayakorn Director 2. Ms. Wansiri Nimpitakpong Director 3. Mr. Athiwat Noiprasit Director Remark: The authorization of PUH is the signatures of Mr. Satit Viddayakorn or Ms. Wansiri Nimpitakpong or Mr. Athiwat Noiprasit, any 2 of 3 directors co-sign and affix the company s seal. Source: The company s affidavit. 4. Shareholder Structure As of June 2, 2017, PUH has registered and paid-up capital of Baht 1,000,000 divided into 100,000 ordinary shares at par value of Baht 10 each. The details are as follows: Name Number of shares (shares) % shareholding 1. Pitsanuloke Medical Co., Ltd. 99, Mr. Satit Viddayakorn Ms. Wansiri Nimpitakpong Mr. Athiwat Noiprasit Total 100, Source: BorAorJor Hospitals in Uttaradit Province Hospital Year of Opening Number of Beds Public Hospitals 1. Uttaradit Hospital 1/ Fort Pichai Dap Hak Hospital (military hospital) 2/ Private Hospital No private hospital - - Remark: Excluded clinics and community hospitals (information as of September 26, 2017). Source: 1/ B8%9A%E0%B8%B2%E0%B8%A5%E0%B8%AD%E0%B8%B8%E0%B8%95%E0%B8%A3%E0%B8%94%E0%B8%B4 %E0%B8%95%E0%B8%96%E0%B9%8C 2/ Attachment 1 - Page 8

98 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Business Overview and Operating Result of Pitsanuvej Pattana Company Limited 1. General Information Company Name : Pitsanuvej Pattana Company Limited ( PPC ) Main Business : Hospital Head Office : 211 Khun Pirenthorathep Road, Nai Muang Sub-district, Muang Pitsanuloke District, Pitsanuloke Province Registered Capital : Baht 1,000,000 Divided into 100,000 ordinary shares at par value of Baht 10 each Paid-up Capital : Baht 1,000,000 Divided into 100,000 ordinary shares at par value of Baht 10 each 2. Nature of Business Pitsanuvej Pattana Co., Ltd. was established on September 15, 2017 to operate private hospital business. Pitsanuloke Medical Co., Ltd (PSV) is a major shareholder with % shareholding. PPC acquired land plots with total area of 809 sq.wah (opposite to Pitsanuvej Hospital) located in Muang Pitsanuloke District, Pitsanuloke Province with approximate cost of Baht 71 million on September 27, 2017 from non-connected persons. Such land will be used as parking area for customers of Pitsanuvej Hospital that tends to increase. It might also be used for business expansion in the future. However, at present PPC has no operation yet. 3. Board of Directors As of October 18, 2017, PPC has 7 directors as follows: Name Position 1. Mr. Satit Viddayakorn Director 2. Ms. Wansiri Nimpitakpong Director 3. Mr. Athiwat Noiprasit Director 4. Mr. Pongsak Viddayakorn Director 5. Mrs. Nipaporn Nimpitakpong M.D. Director 6. Mrs. Piyarat Ukrit Director 7. Mr. Satit Nimpitakpong Director Remark: The authorization of PUH is the signatures of Mr. Satit Viddayakorn or Ms. Wansiri Nimpitakpong or Mr. Athiwat Noiprasit, any 2 of 3 directors co-sign and affix the company s seal. Source: The company s affidavit. 4. Shareholder Structure As of September 15, 2017, PPC has registered and paid-up capital of Baht 1,000,000 divided into 100,000 ordinary shares at par value of Baht 10 each. The details are as follows: Name Number of shares (shares) % shareholding 1. Pitsanuloke Medical Co., Ltd. 99, Mr. Satit Viddayakorn Ms. Wansiri Nimpitakpong Mr. Athiwat Noiprasit Total 100, Source: BorAorJor 5. Attachment 1 - Page 9

99 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Business Overview and Operating Result of Paknampo Hospital Company Limited 1. General Information Company Name : Paknampo Hospital Company Limited ( PNP ) Main Business : Hospital Head Office : 96/12 Moo 9 Asian Highway, Nakhon Sawan Tok Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province Registered Capital : Baht 354,166,000 Divided into 3,541,660 ordinary shares at par value of Baht 100 each Paid-up Capital : Baht 354,166,000 Divided into 3,541,660 ordinary shares at par value of Baht 100 each 2. Nature of Business Paknampo Hospital Co., Ltd. (formerly named Ten M.D. Nakhonsawan Co., Ltd.) was established on September 28, 1987 to operate hospital business. There are two hospitals under PNP, namely Paknampo Hospital and Paknampo 2 Hospital. Both are 100-bed hospitals, located in Muang Nakhon Sawan District, Nakhon Sawan Province. In addition, both hospitals are private hospitals that have been accredited by The Healthcare Accreditation Institute (Public Organization). Both Paknampo Hospital and Paknampo 2 Hospital provide upper secondary care to cash and private insurance patients. Their medical services consist of Emergency Center, Pediatric Clinic, Dental Clinic, Diagnostic Radiography, Gastrointestinal and Liver Clinic, Heart and Cardiovascular Clinic, ICU, Infectious Disease Clinic, Internal Medicine Clinic, Laboratory, Nephrology-kidney Clinic, Neuroscience Department, Orthopedic Clinic, Physical Therapy Department, General Surgery Clinic, Urinary Tract Center, Medical Check-up Center, Genecology and Obstetricians Clinic, and Ear, Nose and Throat Clinic. 3. Board of Director As of August 8, 2017, PNP has 6 directors as follows: Name Position 1. Mr. Pongsak Viddayakorn Director 2. Mr. Saprang Sukvetchaworakij Director 3. Mr. Sitthichai Wongnitchakul Director 4. Mr. Athiwat Noiprasit Director 5. Mr. Satit Viddayakorn Director 6. Mr. Korpong Rukkhaphan Director Remark: The authorization of PNP is the signatures of Mr. Pongsak Viddayakorn, Mr. Satit Viddayakorn, Mr. Athiwat Noiprasit, Mr. Korpong Rukkhaphan, any 2 of 4 directors co-sign and affix company s seal. Source: The company s affidavit. 4. Shareholder Structure As of October 6, 2017, PNP has registered and paid-up capital of Baht 354,166,000 (divided into 3,541,660 ordinary shares at par value of Baht 100 each. The details are as follows: Name Number of shares (shares) % shareholding 1. Alliance Medical Asia Co., Ltd. 3,220, Mr. Sitthichai Wongnitchakul 32, Mrs. Ratthaya Wongnitchakul 32, Mrs. Yaowanit Nititham 22, Mr. Saprang Sukvetchaworakij 20, Mrs. Patta Siripap 18, Mr. Worathat Palakawong Na Ayutthaya 15, Mrs. Thanu Arayathaworn 15, Mr. Woravut Saowapakphusit 10, Mr. Jakri Siripap 10, Total top 10 major shareholders 3,398, Other 67 shareholders 1/ 143, Total 3,541, Source: BorAorJor 5. Remark: 1/ Not connected person of PRINC. 5. Summary of Financial Positions and Operation Results The key financial figures of PNP for the year are as follows: Attachment 1 - Page 10

100 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Financial Statement for the company only Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2016 (Unit: Baht thousand) Restated Restated Total current assets 148, , , Total non-current assets 609, , ,496, Total assets 758, ,362, ,656, Total current liabilities 92, , , Total non-current liabilities 400, , , Total liabilities 493, , , Issued and paid up capital 88, , , Share premium 99, , , Retained earnings 77, , , Total shareholders equity 265, , , Total liabilities and shareholder s equity 758, ,362, ,656, Total revenues 412, , , Total expenses (343,329.49) (365,915.86) (463,380.31) Profit (loss) before financial costs and income tax 69, , , Financial costs (2,512.25) (14,827.07) (19,329.24) Profit (loss) before income tax 66, , (15,504.86) Income tax (14,146.37) (1,692.84) - Net profit (loss) for the year 52, , (15,504.86) Source: Financial statement of PNP for the year ended December 31, 2014 was audited by a certified auditor who is not in the approved list of SEC. Financial statement of PNP for the year ended December 31, 2015 was audited by Bunchikij Co., Ltd. which is an auditor in the approved list of SEC. Financial statement of PNP for the year ended December 31, 2016 was audited by PricewaterhouseCoopers ABAS Co., Ltd. which is an auditor in the approved list of SEC. 6. Hospitals in Nakhon Sawan Province Hospital Year of Opening Number of Beds Public Hospitals 1. Sawanpracharak Hospital / 659 2/ 2. Fort Chiraprawat Hospital (military hospital) 3/ Private Hospitals 1. Paknampo Hospital Paknampo 2 Hospital / 2014* Srisawan Hospital 5/ Romchat Hospital n.a / 4. Ruamphaet Hospital Nakhon Sawan 7/ Remark: Excluded clinics and community hospitals (information as of September 26, 2017). * Year that renamed Rattanavet Hospital to Paknampo 2 Hospital. Source: 1/ 2/ Information from telephone inquiry from the hospital 3/ 4/ 5/ 6/ Romchat hospital does not disclose the information so this information was derived from Paknampo hospital 7/ Attachment 1 - Page 11

101 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Business Overview and Operating Results of P.N.P Hospital Company Limited 1. General Information Company Name : P.N.P Hospital Company Limited ( PNPH ) Main Business : Hospital Head Office : 96/12 Moo 9 Asian Highway, Nakhon Sawan Tok Sub-district, Muang Nakhon Sawan District, Nakhon Sawan Province Registered Capital : Baht 150,000,000 Divided into 1,500,000 ordinary shares at par value of Baht 100 each Paid-up Capital : Baht 37,500,300 Divided into 1,499,996 ordinary shares with paid-up capital of Baht 25 per share and 4 fully paid-up ordinary shares 2. Nature of Business P.N.P Hospital Co., Ltd. (PNPH) was established on April 9, 2014 to operate medical service business. Currently it has registered capital of Baht 150,000,000. However, PNPH has no business operation yet. 3. Board of Directors List of PNPH s 3 directors as of June 23, 2017 is as follows: Name Position 1. Mr. Athiwat Noiprasit Director 2. Mr. Sirichai Towiriyawate Director 3. Mrs. Datchaniphon Phantaphom Director Remark: The authorization is the signatures of Mr. Athiwat Noiprasit and Mr. Sirichai Towiriyawate jointly sign. 4. Shareholder Structure As of August 15, 2017, PNPH has registered capital of Baht 150,000,000 divided into 1,500,000 ordinary shares at par value of Baht 100 each. Paid-up capital is Baht 37,500,300 divided into 4 fully paid up ordinary shares at par value of Baht 100 per share and 1,499,996 ordinary shares with paid-up capital of Baht 25 per share worth Baht 37,499,900. The shareholders detail is as follows: Name No. of shares Paid-up Paid up capital % shareholding (Baht/share) (Baht) 1. Paknampo Hospital Co., Ltd. 1,499, ,499, Ms. Timpika Saithong Ms. Datchaniphon Phantaphom Mr. Thanaboon Joingjira Mr. Sirichai Towiriyawate Total 1,500,000 37,500, Remark: Par value is Baht 100 per share. The registered capital is Baht 150 million. Source: BorAorJor Summary of Financial Positions and Operation Results The key financial figures of PNPH for the year are as follows: Financial statement for the company only Dec. 31, / Dec. 31, 2015 Dec. 31, 2016 (Unit: Baht thousand) Current assets 36, , , Non-current assets Total assets 36, , , Current liabilities Non-current liabilities Total liabilities Issued and paid-up capital 37, , , Retained earnings (562.15) (418.55) (45.82) Total shareholders equity 36, , , Total liabilities and shareholders equity 36, , , Total revenues Total expenses (957.24) (60.00) (116.48) Profit (loss) before financial costs and income tax (562.15) Financial costs Profit (loss) before income tax (562.15) Income tax Net profit (loss) for the year (562.15) Attachment 1 - Page 12

102 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Source: Financial statement of PNPH for the year ended December 31, 2014 was audited by a certified auditor who is not in the approved list of SEC. Financial statement of PNPH for the year ended December 31, 2015 was audited by Bunchikij Co., Ltd. which is an auditor in the approved list of SEC. Financial statement of PNPH for the year ended December 31, 2016 was audited by PriceWaterhouse Coopers ABAS Co., Ltd. which is an auditor in the approved list of SEC. Remark: 1/ Financial performance in 2014 was from the incorporation date (April 9, 2014) until December 31, Attachment 1 - Page 13

103 Attachment: Opinion of IFA -TRANSLATION- Principal Capital Public Company Limited Private Hospital Industry Outlook and Competition Overall private hospital business in the past year was favorable. Revenue growth was higher than GDP growth and continues to grow in corresponding to the number of domestic and foreign patients. Private hospital industry tends to grow continuously with the following supporting factors: 1. Growth of high purchasing powered middle-class group The economic and income growth of the population especially that of the middle class will continue to bolster the need for medical services. The low rate of private hospital medical expenses per GDP of Thailand compared to other countries is relatively low, providing an opportunity for growth in the private hospital business. 2. Growth of aging population who need medical care In the long run, aging society is the supporting demand for modern and high-technological medical service. The number of senior citizen (age over 65) increases continuously especially those aged over 85. This group increasingly needs medical services as they have high rate of sickness and are unable to take care of themselves, therefore the special care is required. According to the forecast of The Office of the National Economics and Social Development Board (NESDB), the number of aging population aged over 60 will increase from the current number of 9.1 million to 10.3 million in Figure 1: Aging population trend (age over 60) in Thailand 3. Urbanization United Nation predicts that Urbanization Rate in Thailand will increase from 35.6% in 2015 to 40.7% in 2025 reflecting that urban expansion would provide an opportunity for medical service expansion to provincial area that rapidly expanding compared to the needs for medical service in Bangkok Metropolitan that is quite saturated. Figure 2: Urbanization rate in Thailand Attachment 1 - Page 14