AP Weekly Insight

Weekly Update
AP Weekly Insight
Asia Pacific ex Japan / Investment Strategy
Agenda
Equity Research
Feb 15, 2008
21 Did the Snowstorm Freeze Chinese Consumers? Anita Hwang
27 Tech: (TSMC) (2330.TT, Not Rated) / (UMC) (2303.TT, Not Rated) H C Kwan.CFA
23 Banking: M&A Rumor & Asset Quality Worries Patrick Pong
Key Calls
16 Metal & Mining: Shougang Concord Int’l (697 HK,BUY,TP HK$ 3.50) EY Lee
14 Pharmaceutical: CSL LTD (CSL AU,BUY,TP A$42.04) Sean Hwang
2 AP Economics
Temporary Negative Effect from Snowstorm
Hee Chan Park
3
4
5
7
11
14
Fixed Income
Another liquidity cycle?
Byungsoo Lee, CFA
Fund Flows
Funds Flow Bottomming….
Sunyoung Ahn, CFA
Quant Strategy
Valuations vs. Earnings
Young Jean Hwang
Earnings & Valuation / Performance Table
Asia Pacific Country & Sector Rating for February
Pharmaceutical
CSL LTD (CSL AU,BUY,TP A$42.04)
Sean Hwang
16 Metal & Mining
Shougang Concord Int’l (697 HK,BUY,TP HK$ 3.50)
EY Lee
18 Construction & Property
Chongqing - Glittering in Western China
Kaiser Choi
19 Shipping
NOL: Stronger than Expected US Routes
Jay Ryu
20 Auto Parts
Strong Potential in Key Emerging Markets
Jaewoo Kim
21 Consumer
China’s Consumer Sector
Anita Hwang
22 Banking
M&A Rumor & Asset Quality Worries
Patrick Pong
24 Internet / Software
China’s B2B e-Commerce Giant
Woo-Cheol Jeong
25 Tech
Semiconductor Update
Hak Moo Lee
26 Tech
Taiwan Semiconductor Manufacturing (TSMC)(2330.TT, Not Rated)
United Microelectronics (UMC)(2303.TT, Not Rated)
H C Kwan,CFA
27 Telecom
IPTV Begins to Bloom in Asia
Young Choi
MIRAE ASSET RESEARCH

AP Insight
AP Economics
Comment
China Economy
Hee Chan Park
82-2-3774-1850 / hcpark@miraeasset.com
Temporary Negative Effect from Snowstorm
Estimates of immediate damage
The snowstorm has cast a shadow over China’s short-term
growth prospects. GDP growth under 10% YoY cannot be
ruled out.
Six key provinces suffering from the snowstorm are Anhui,
Jiangxi, Hunan, Hubei, Guangxi and Guizhou, but among
them Anhui, Hunan and Hubei were most affected. The
affected regions produce 10-15% of total GDP. Considering
that entire economic activities stopped for a month in these
regions, we estimate 1Q08 GDP to fall by 3.4-4.7%.
Figure 1. Weight of Damaged Districts by Activity
(%)
25
20
15
10
5
0
14.3
15.4
10.1 10.6 10.4
16.4
14.7
22.2
7.0
10.4
3 Province
6 Province
2.9
1.9
State GDP Retail Sales Fixed Agricultural Industrial Exports
investmet Production Production
Source: FactSet, Mirae Asset Research estimates
Damage is likely to be different by industry. Primary industry
and domestic demand seems to be more affected than
secondary industry or exports. In terms of total national
output, agricultural production of the damaged regions
makes up 14.7-22.2%. However, industrial production
makes up 7.0-10.4%, retail sales 10.6-15.4%, fixed
investment 10.4-16.4%, and exports just 1.9-2.9%.
Figure 2. Primary Production in 2007
(100Bn Yuan)
20
Feb 15, 2008 MIRAE ASSET RESEARCH 2
15
10
5
0
23.6
Whole Country (LHS) (%)
6 Province (LHS)
25
Weight of 6 Province (RHS)
23
22.0
20.9
21
1Q07 2Q07 3Q07
Source: National Bureau of Statistics of China, Mirae Asset Research
estimates
Long-term effect from snowstorm
Annual GDP growth should not be significantly affected for
the following positive factors:
(1) 1Q GDP makes up just one-fifth of the entire year’s GDP
(relatively lower than other quarters) as production
activity nearly stops during the Lunar New Year holiday.
(2) Coal shortage is to be eased once transportation is
restored; Shanxi, Inner Mongolia and Henan (46.7% of
total domestic coal production) have not been seriously
affected by the storm.
(3) Post-storm reconstruction should enhance investments
into infrastructure; special agricultural loans from the
PBC for affected areas and subsidies from central states
and other countries should boost the growth rate.
However, inflation still remains a risk factor. Price has risen
sharply since the storm. High inflation should sustain until
restoration is complete. But we cannot rule out the
possibility that this might prolong the inflation period, and
exacerbate sluggishness in domestic demand.
Investment implications
Inflationary pressure heightened by variables like natural
disasters are not significant factors for a rate hike. Although
the snowstorm is likely to have increased inflationary
pressure, the rate hike does not seem to be a card the PBC
can use. Moreover, concerns of a US recession, and the
Fed’s aggressive rate cuts are additional obstacles to a rate
hike.
19
17
15

AP Insight
Fixed Income
Comment
Another liquidity cycle?
Byungsoo Lee, CFA
82-2-3774-2174 / bsool@miraeasset.com
High possibility of Europe following US lead
Monetary policy in advanced countries took note of the
quick and sharp cuts in the US Fed Funds rate. Last week,
the bank of England (BOE) also lowered its benchmark
rate 25bp to 5.25%, following a December 2007 rate cut,
reflecting concerns that a sharp slowdown of activity pulls
inflation below its target in the mid term. The European
Central Bank (ECB) newly expressed that uncertainty
about prospects for economic growth are unusually high,
even though it kept its rate on hold due to inflation risk.
Figure 1. Monetary Easing in Advanced Countries
(% ) Policy Rates in the Major Advanced Countries
7
6
5
4
3
US
2
Canada
1
0
ECB
UK
03 04 05 06 07 08
Source: Bloomberg, Mirae Asset Research Center
In its monetary statement of January 10, the ECB expects
Europe to grow at pace close to its projected growth rate
despite uncertainty in the overseas financial markets.
However, recently the ECB took a more conservative
stance on economic prospects due to the heightened
possibility of the European economy being affected by a
major slowdown in the US. We believe this is due mainly
to the German and French economies slowing quicker
than other European economies, adding to fears that this
will affect the European economy as a whole
Advanced countries affected by the US economic
slowdown are highly likely to follow the US lead and lower
benchmark rates as well. We need to focus on the fact
that the BOE has continued to lower rates, even though
the UK has strong domestic demand relative to other
European countries. The European bond market has
already priced in a future rate cut with government bond
yields now below the ECB policy rate of 4%,
BoK may stay ahead of the curve.
The February BOK has decided to leave its benchmark
rate at 5% (unchanged since August 2007). What is most
different from previous statements is that the BOK is very
concerned with the uncertainty of Korean economic
prospects due to spillover from the US slowdown. With
private consumption slowly moderating, the Korean
economy is likely to grow at a slower pace if exports
weaken (even though solid now) due to decrease in
demand by major trading partners. Given the BOK
chairman’s remarks on the possibility of preemptive easing
of monetary policy ahead of adverse economic data, we
expect the BOK to cut its benchmark rate by 50bp in the
first half of this year.
Other countries continue tightening stance
With the uncertain over global financial markets, several
resource-rich countries have been tightening their rates.
Australia raised its benchmark rate to 7% and Russia
raised its benchmark rate to 10.25%. These countries are
exports-oriented and benefiting from the fast growth of
emerging economies. This may imply that emerging
countries are growing steadily relative to advanced
countries and thus indicates that negative spillover effects
from US are limited. However, we believe that these
countries will need to lower rates going forward due to
rapidly widening interest rates worldwide.
Figure 2. Monetary Tightening Abroad
(% ) Policy Rates in the High-Resource Countries
20
Australia
18
Russia
16
Norway
14
12
10
8
6
4
2
0
Sweden
03 04 05 06 07 08
Source: Bloomberg, Mirae Asset Research Center
Feb 15, 2008 MIRAE ASSET RESEARCH 3

AP Insight
Fund Flows
Weekly Update
Funds Flow Bottomming….
Sunyoung Ahn, CFA
82-2-3774-1409 / syan@miraeasset.com
Regional funds such as international funds and emerging market funds recorded slight net inflow or moderate net outflow. For
the US funds, which had posted a large-scale outflow over three weeks consecutively, outflow declined to 70% of the level
recorded two weeks ago (or US$6.7bn) last week.
In Korea and India, foreign investors are selling some stocks for profit-taking. Meantime, in other Asian countries, moderate net
purchase has been going on for the past three weeks.
Due to the fund flow attributes lagging the market, it is premature to expect a dramatic turn into inflow. However, the fact that
the global fund flow and foreign investors’ trading in Asia is stabilizing raises the expectations for the market’s bottoming out.
Figure 1. Global & US Fund Flow Figure 2. Global Sector Fund Flow
(US$ mn) 02/07~
02/13
Weekly Net Inflow
01/31~
02/06
4-Wk Net
Inflow
YTD
Total
Asset
Total Equity Type -7,606 -7,912 -36,600 -37,696 -
Asia ex.
Japan
-461 -435 -7,059 -8,641 169,423
South
America
Emerging
markets
EMEA
-162
-288
-131
-72
-1,595
-2,240
-2,248
-1,177
45,030
51,718
Emerging
markets
Emerging
-116 571 -3,855 -4,931 216,554
markets,
total
-1,026 -68 -14,750 -16,996 482,724
Pacific -5 35 -764 -1,113 21,420
International 128 1,332 -5,937 -5,534 764,654
US -6,725 -9,579 -32,031 -35,588 1,803,353
Advanced Europe
markets
-1,105 -145 -7,031 -14,755 301,122
Japan -279 -503 -3,207 -4,214 40,285
Taxable Bond Fund 1,200 2,200 5,323 9,523 -
Note: Each period from Thursday to Wednesday
Source: AMG Data Service, EPFR (as of February 13, 2008)
(US$ mn)
Weekly Net Inflow
Last 2 Weeks 3 Weeks
Week ago ago
Feb 15, 2008 MIRAE ASSET RESEARCH 4
4-Wk
Total
2008
YTD
Total
Asset
All Sector
Funds
-695 -2,147 -1,741 -3,855 -1,296 231,643
Commodities/
Materials
155 -51 301 382 1,500 58,950
Consumer Goods 307 109 -99 607 696 6,465
Energy -641 -448 -711 -1,674 -2,560 26,892
Financials 274 -1,445 222 -50 1,644 15,361
Health Care/Biotech -68 -24 -135 -74 231 24,410
Real Estate -425 -139 -579 -1,129 -895 45,749
Technology -307 -132 -338 -1,044 -1,466 23,421
Telecom -16 -100 -41 -283 -381 5,870
Utilities 25 76 -343 -577 -50 24,273
Note: Each period from Thursday to Wednesday
Source: EPFR (as of February 13, 2008)
Figure 3. Foreign Investors Trading Trend in Asia Figure 4. Foreign Investors in 6 Asian Countries
(US$ mn)
Last
Week
Foreign Investors' Net Purchases
2
Weeks
ago
3
Weeks
ago
4
Weeks
ago
4-Wk
Total
Weekly Market
YTD
Performance
Korea -1,254 105 -745 -2,437 -4,332 -10,101 -4.72
Taiwan 542 0 412 -586 368 -487 -1.81
India -400 915 -1,182 -1,949 -2,616 -3,301 -3.31
Thailand 269 304 380 -349 604 -333 3.31
Indonesia 52 20 139 -76 134 207 -0.88
Philippines 7 -35 3 -91 -115 -303 -1.16
6 Asian
Countries Total
-784 1,308 -993 -5,488 -5,958 -14,318
Japan N/A N/A -3,497 -1,495 -4,991 -6,799 0.12
Note: Each period from Monday to Friday; Last week is from Monday to
Thursday , Japanese as of January 25, 2008
Source: Bloomberg(as of February 14, 2008)
(pt)
440
400
360
320
280
240
200
160
120
80
MSCI EM Asia Index (LHS)
(USD mn)
Foreign Investors' Accumulated Net Purchases
220,000
(RHS)
190,000
Jan-03 Nov-03 Sep-04 Jul-05 May-06 Mar-07 Jan-08
Note: 6 Asia Markets include Korea, Taiwan, India, Indonesia, Thailand,
Philippines.
Source: Bloomberg(as of February 14, 2008)
160,000
130,000
100,000
70,000
40,000
10,000
(20,000)

AP Insight
Quantitative Strategy
Weekly Update
Valuations vs. Earnings
Young Jean Hwang
82-2-3774-1780 / YoungJean@miraeasset.com
Valuations reasonable
The global stock market has been weakening since Nov
2007 amid concerns over a potential recession of the US
economy. While the MSCI AC World index declined 14%
from its 2007 high, the MSCI AC Asia Pacific ex. Japan
index plunged 21% from its 2007 peak.
This makes the valuations of the Asia Pacific ex. Japan
market undemanding. 12-month forward P/E has declined
28% from the previous high of 17.4x (Oct 29, 2007) to
12.5x (Jan 22, 2008), and recently rebounded to 13.1x
(Feb 13, 2008). The recent decline in 12-month forward
P/E (from 17.4x to 12.5x) is the steepest since 2003, even
in view of the decline of the 12-month forward P/E from its
record high to its record low.
Figure 1. 12-MF P/E in Asia-Pacific ex. Japan
(x)
18
17.4x
16.0x
16
14.6x
14.2x
13.9x
14
12.7x
13.0x
11.8x
13.1x 12.9x
12
12.5x
11.4x
11.7x
11.5x
10
10.2x 10.6x
2003 2004 2005 2006 2007 2008
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
In addition, 12-month trailing P/B of the Asia Pacific ex.
Japan market has decreased to 2.4x from the 3.0x historic
high recorded in Oct 2007. Though this is above the 2.0x
average since 2001, it seems reasonable that the ROE of
the Asia Pacific ex. Japan market still maintains its upward
trend.
Figure 2. 12-MT P/B in Asia-Pacific ex. Japan
(x) (%)
1.0
8
2001 2002 2003 2004 2005 2006 2007 2008
Feb 15, 2008 MIRAE ASSET RESEARCH 5
3.5
3.0
2.5
2.0
1.5
12M Trailing P/B
12M Trailing ROE
Source : MSCI, FactSet, Mirae Asset Research
Earnings deteriorating
Meanwhile, estimated earnings prospects of the Asia
Pacific ex. Japan market continue to deteriorate.
Upgrades have outpaced downgrades since mid-January
2008. The earnings revision ratio in the Asia Pacific ex.
Japan market has recently plunged to -20%, the lowest
since 2003.
The earnings revision ratio fell to 0% in August 2007 when
the seriousness of the subprime issue first began to be felt.
In December 2007, it began declining further into negative
territory over concerns of a potential recession in the US
consumption that began to take shape.
Figure 3. Earnings Revision Ratio in AP ex. Japan
(%)
30
20
10
0
-10
Earnings revision ratio (weekly)
-20
Earnings revision ratio (4-week MA)
-30
Jan-07 Apr-07 Jul-07 Oct-07 Jan-08
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
On a country level, countries that are highly linked to the
US economy have experienced more deterioration in
forecast earnings. The earnings revision ratios in Taiwan
and Korea have recently plummeted into deep negative
territory (from positive territory in November 2007). In
Japan, its earnings revision ratio has been declining
further into the negative, as well. On the contrary, the
earnings revision ratios in India and Hong Kong have
remained relatively robust.
18
16
14
12
10

AP Insight
Figure 4. Earnings Revision Ratios by Country
(%)
60
40
20
0
-20
-40
-60
Indonesia
India
Malaysia
Hong Kong
China
Pakistan
Philippines
Nov 2007 Feb 2008
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Continuously deteriorating earnings revision ratios in the
Asia Pacific ex. Japan market are likely to imply that the
downward revision of forecast EPS is becoming a marketwide
trend. As such, it is highly likely to deal a blow to
valuation attractiveness in Asia Pacific ex. Japan.
Market direction
All in all, we think that while reasonable valuations will limit
the market’s downside risk, stock markets are likely to
remain range-bound until there is greater clarity about
macroeconomic and earnings growth.
Singapore
Australia
Japan
Thailand
New Zealand
Korea
Taiwan
Feb 15, 2008 MIRAE ASSET RESEARCH 6

AP Insight
Earnings & Valuation / Performance Table
Young Jean Hwang
82-2-3774-1780 / YoungJean@miraeasset.com
Table 1. Earnings & Valuation / Performance : Global Market
Country Weight # Co's EPS G (%) EPS Change (%) ERR - 12MF 12-month Forward Valuation Performance
08E 09E LT(5Y) 2008E 2009E 02/13 1W 1M PER PBR EV/EBITDA DY PEG 1W 1M 12M YTD
(%) (YoY) (YoY) Forcast 1W 1M 1W 1M (%) (%) (%) (x) (x) (x) (%) (x) (%) (%) (%) (%)
AC World 100.0 2,872 12.2 11.8 12.0 -0.7 -0.8 -0.6 -0.6 -29 -27 -12 12.4 2.1 7.5 3.1 1.0 1.6 -4.9 -7 -9
Developed Market 88.8 1,945 11.7 11.6 11.2 -0.8 -0.8 -0.6 -0.5 -35 -32 -17 12.5 2.1 7.6 3.1 1.1 1.7 -4.5 -9 -9
EAFE 42.1 1,205 8.6 10.2 9.6 -1.2 -1.4 -1.2 -1.4 -41 -37 -13 11.4 1.8 7.3 3.6 1.2 0.2 -7.0 -14 -12
Pacific 12.7 586 5.0 10.9 11.6 -0.8 0.3 -0.5 0.6 -33 -30 -10 13.1 1.4 8.6 2.5 1.1 -1.0 -7.7 -20 -13
North America 46.7 740 15.4 13.2 12.6 -0.3 -0.4 0.0 0.4 -25 -22 -24 13.7 2.9 7.9 2.5 1.1 3.1 -2.2 -5 -7
Europe 29.4 619 9.9 10.0 8.8 -1.4 -2.0 -1.5 -2.2 -49 -44 -17 10.8 1.9 6.7 4.1 1.2 0.7 -6.6 -11 -11
Emerging Market 11.2 927 15.8 13.1 19.3 -0.2 -0.9 -0.5 -1.1 -16 -15 2 12.1 2.0 6.9 2.9 0.6 0.5 -7.9 15 -11
Asia 5.9 555 16.7 14.4 21.7 0.0 -0.8 -0.1 -0.7 -24 -22 2 12.8 2.0 6.8 2.8 0.6 -2.8 -11.3 17 -14
Latin America 2.5 148 15.3 10.1 17.0 1.1 -0.2 0.1 -1.0 -2 -1 -2 12.5 3.6 8.9 3.7 0.7 6.0 0.9 23 -4
Europe 1.6 102 11.9 8.6 13.9 -0.1 0.8 -0.2 -0.2 13 16 -3 10.1 1.5 6.4 2.6 0.7 4.1 -10.7 8 -12
AC Asia Pacific 18.6 1,141 8.5 12.0 14.9 -0.6 -0.1 -0.4 0.2 -28 -26 -4 13.0 1.6 8.1 2.6 0.9 -1.6 -8.9 -11 -14
AC AP ex. Japan 10.1 744 8.6 14.6 17.1 0.1 -0.1 0.2 0.4 -24 -22 1 13.1 2.1 9.7 3.3 0.8 -2.2 -10.5 7 -14
AC Asia 15.8 1,043 9.5 11.6 16.0 -0.8 -0.3 -0.7 -0.3 -28 -25 -4 13.1 1.5 6.9 2.3 0.8 -1.6 -9.1 -12 -14
AC Asia ex. Japan 7.3 646 10.7 14.5 20.4 0.0 -0.7 -0.2 -0.7 -23 -20 1 13.3 2.0 7.2 2.9 0.7 -2.4 -11.5 15 -14
Australia 2.7 88 13.9 7.9 9.0 0.0 0.8 0.5 2.0 -31 -40 -7 12.7 2.3 15.8 4.5 1.4 -1.7 -7.7 -7 -13
Hong Kong 1.0 54 -19.8 16.2 16.1 -0.1 0.5 -0.1 0.4 -6 9 2 17.4 1.8 12.4 3.0 1.1 -1.5 -13.3 12 -16
Japan 8.5 397 8.3 9.1 12.0 -1.4 -2.6 -1.2 -2.6 -37 -34 -13 13.1 1.3 6.7 1.8 1.1 -0.8 -6.9 -26 -13
New Zealand 0.1 10 5.2 6.0 6.8 0.2 -0.5 0.1 -1.0 -40 -30 20 12.7 2.0 6.7 5.7 1.9 -4.9 -8.9 -19 -13
Singapore 0.5 37 3.3 13.4 13.3 -0.6 -1.0 -0.7 -1.9 -31 -28 -6 12.7 1.8 3.4 4.1 1.0 0.4 -9.8 -6 -15
China 1.6 112 21.5 16.6 23.8 0.0 1.1 -0.2 0.5 -9 -18 8 15.1 2.7 7.4 2.4 0.6 -0.6 -16.6 37 -18
India 0.8 63 20.7 23.3 28.3 0.3 0.7 0.4 1.0 21 16 34 18.0 3.3 11.1 1.1 0.6 -7.4 -20.7 22 -19
Indonesia 0.2 23 17.1 17.1 39.3 0.7 3.7 0.7 5.4 48 26 65 14.7 4.1 6.5 2.8 0.4 -0.9 -5.0 65 -2
Korea 1.5 113 15.6 14.3 18.2 -0.8 -0.6 -0.8 -0.8 -54 -41 -36 10.5 1.4 5.5 2.0 0.6 -4.7 -7.3 13 -14
Malaysia 0.3 56 -6.1 11.8 15.4 0.5 -0.1 0.2 -0.1 -6 6 15 15.3 2.3 7.1 3.6 1.0 0.8 -6.0 16 -1
Pakistan 0.0 13 18.7 10.1 12.6 -0.2 0.9 -0.2 0.4 -10 -10 -10 11.0 NA 6.9 4.7 0.9 1.2 3.9 15 3
Philippines 0.1 18 15.0 19.3 13.1 -0.3 -0.6 -0.3 -0.8 -28 -17 11 13.9 2.3 6.2 3.2 1.1 -0.7 -8.2 -5 -11
Taiwan 1.1 123 10.0 9.2 18.3 -0.4 -6.1 -0.9 -5.4 -57 -56 -12 11.1 1.7 6.3 5.2 0.6 -1.8 -5.1 -5 -11
Thailand 0.2 34 100.9 6.9 12.3 0.3 0.9 0.3 1.3 -39 -29 20 11.2 2.0 6.5 3.8 0.9 4.5 5.6 24 -3
AC Americas 49.3 888 15.4 13.0 12.8 -0.2 -0.3 0.1 0.3 -22 -20 -21 13.6 2.9 7.9 2.5 1.1 3.3 -2.1 -4 -6
US 42.9 635 15.8 13.5 12.6 -0.4 -0.5 0.0 0.3 -27 -23 -27 13.6 2.9 7.9 2.5 1.1 3.1 -2.2 -5 -7
Canada 3.8 105 11.0 9.8 11.6 0.7 1.8 1.0 2.6 -10 -15 -2 13.7 2.4 6.5 3.0 1.2 3.3 -2.6 2 -4
Argentina 0.1 11 23 7.9 NA 66.7 77.9 -2.5 -2.2 0 0 0 10.5 NA NA 2.6 NA -0.1 -2.2 -13 -9
Brazil 1.6 69 11.7 12.1 14.8 -0.8 -0.8 -0.6 0.9 -3 0 -2 12.1 3.1 8.3 4.7 0.8 6.6 0.8 39 -4
Chile 0.1 27 21.4 12.2 13.1 1.3 0.2 1.4 -0.3 13 7 13 15.0 1.8 7.0 3.0 1.1 5.0 1.6 -6 -6
Colombia 0.0 7 45.1 30.2 NA -0.7 0.9 -0.3 14.3 100 100 0 10.4 NA NA 3.9 NA 1.5 -10.1 -8 -14
Mexico 0.6 28 22.7 4.1 23.8 -0.4 -2.0 -0.2 -6.3 -17 -18 -15 13.2 2.7 6.9 3.4 0.6 5.2 1.9 2 -1
Peru 0.1 6 49.3 -12.5 15.0 -4.7 -10.1 -3.8 -16.5 0 0 100 19.2 NA NA NA 1.3 9.0 1.9 57 1
AC Europe 31.0 721 10.0 9.9 8.9 -1.3 -1.9 -1.4 -2.1 -41 -37 -15 10.8 1.9 6.7 4.0 1.2 0.9 -6.8 -11 -11
Austria 0.2 16 9.6 9.8 9.9 -0.1 -1.3 -0.5 -1.4 -38 -25 13 9.1 1.4 5.6 3.3 0.9 1.0 -4.5 -23 -13
Belgium 0.5 22 2.0 12.9 7.9 -3.5 -8.4 -3.1 -8.4 -14 -5 -27 10.0 1.8 7.2 4.5 1.3 0.3 -9.5 -29 -13
Denmark 0.4 23 15.6 14.0 17.5 0.3 -0.6 0.1 -0.5 -36 -50 -14 13.4 2.5 8.8 1.9 0.8 3.3 0.5 -5 -8
Finland 0.8 23 -6.1 7.5 6.0 -0.1 1.1 -0.8 0.3 -30 -30 -26 13.5 2.9 8.0 3.4 2.2 3.7 4.6 16 -6
France 4.4 74 13.6 9.5 6.4 -0.7 -1.9 -0.9 -2.3 -57 -58 -28 10.5 1.6 5.9 4.1 1.6 0.9 -8.6 -15 -13
Germany 3.9 61 9.2 12.1 8.3 -0.3 -1.3 -0.5 -1.4 -58 -33 -16 11.0 1.7 5.8 3.5 1.3 2.0 -8.8 -1 -13
Greece 0.3 15 13.7 17.7 21.3 -0.5 -0.5 -0.9 -0.8 -47 -7 -20 11.0 2.2 7.3 4.5 0.5 -1.1 -11.3 -8 -16
Ireland 0.3 14 7.1 7.6 7.1 -0.6 -0.6 -0.8 -2.0 -57 -71 -21 8.4 1.4 7.8 4.9 1.2 0.1 -0.6 -34 -4
Italy 1.7 40 11.1 9.8 6.2 -0.3 -0.4 -0.3 -0.4 -44 -28 -28 10.0 1.6 5.3 5.3 1.6 0.5 -8.9 -20 -11
Netherlands 1.2 24 2.4 10.2 6.6 -0.3 -1.5 -0.3 -1.3 -63 -63 -25 10.4 1.8 6.6 4.2 1.6 -0.2 -7.1 -11 -13
Norway 0.4 22 4.8 12.0 9.6 -0.1 -0.2 -0.5 -0.5 -45 -27 -9 10.4 1.9 4.8 4.1 1.1 0.6 -8.0 -14 -18
Portugal 0.2 11 7.6 11.3 7.7 -0.6 -2.0 -0.8 -2.7 -45 -45 -36 13.4 2.4 8.9 4.4 1.7 0.9 -8.9 -9 -12
Spain 1.7 31 13.1 12.8 8.1 0.1 -0.5 -0.1 -0.8 -77 -71 0 10.5 2.0 7.3 4.9 1.3 1.5 -9.3 -10 -14
Sweden 1.0 48 5.3 8.4 6.4 -1.5 -4.2 -1.9 -4.4 -67 -62 -24 10.7 2.0 7.1 4.8 1.7 0.8 -2.3 -20 -12
Switzerland 2.9 39 33.5 11.2 11.9 -1.1 -3.0 -1.2 -3.1 -50 -55 -13 12.0 2.4 8.8 3.1 1.0 -0.3 -7.3 -19 -11
UK 9.5 156 5.7 8.3 9.8 -0.2 -1.6 -0.1 -1.6 -40 -42 -10 10.9 2.0 7.3 4.3 1.1 0.1 -4.8 -9 -9
Czech Rep. 0.1 7 18.6 8.7 18.9 0.1 0.6 -0.7 -1.6 -33 17 17 14.4 3.6 9.0 4.1 0.8 2.6 -2.3 15 -9
Hungary 0.1 4 10.2 6.4 7.3 0.5 0.8 -0.3 -0.8 50 25 0 9.9 2.1 6.0 3.5 1.4 7.2 -1.2 1 -7
Poland 0.2 28 6.3 9.2 19.6 2.1 -3.8 -0.2 -6.8 -19 -38 -4 10.9 1.1 5.8 4.5 0.6 4.3 -3.9 -13 -11
Russia 1.1 32 13.5 6.8 13.4 -0.1 2.1 -0.3 1.0 52 67 -10 10.0 1.4 6.5 1.7 0.7 4.1 -12.4 14 -11
Turkey 0.2 31 8.1 18.4 11.3 -1.5 1.3 1.3 3.6 17 27 -3 8.2 1.7 4.9 4.8 0.7 3.1 -13.9 1 -20
Israel 0.3 32 13.1 29.1 14.6 -0.8 -1.9 1.2 -1.8 -5 -14 19 12.2 2.0 9.8 4.4 0.8 2.0 -5.0 6 -7
Egypt 0.1 17 10.3 15.0 15.0 0.7 4.9 -3.9 -0.7 -17 -8 27 15.2 NA 8.5 2.7 1.0 -1.6 -8.2 40 -5
South Africa 0.7 50 21.6 17.7 11.4 0.3 0.1 0.8 1.9 -32 -22 2 10.4 2.4 6.7 4.0 0.9 2.1 -0.4 3 -3
Note : Above table is as of Feb. 13, 2008.
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Feb 15, 2008 MIRAE ASSET RESEARCH 7

AP Insight
Table 2. Earnings & Valuation / Performance : MSCI AC Asia Pacific ex. Japan
Country Weight # Co's EPS G (%) EPS Change (%) ERR - 12MF 12-month Forward Valuation Performance
08E 09E LT(5Y) 2008E 2009E 02/13 1W 1M PER PBR EV/EBITDA DY PEG 1W 1M 12M YTD
(%) (YoY) (YoY) Forcast 1W 1M 1W 1M (%) (%) (%) (x) (x) (x) (%) (x) (%) (%) (%) (%)
Market 100.0 744 8.6 14.6 17.1 0.1 -0.1 0.2 0.4 -24 -22 1 13.1 2.1 9.7 3.3 0.8 -2.2 -10.5 7 -14
Energy 8.2 40 19.3 12.1 17.7 0.7 3.7 0.5 4.0 31 13 18 13.4 2.7 7.8 2.6 0.8 -1.7 -15.5 48 -16
Materials 13.1 77 6.6 12.8 9.4 -0.1 1.4 1.3 4.7 -19 -33 5 11.3 2.3 6.5 2.9 1.2 0.2 -7.8 28 -10
Chemicals 2.0 21 8.1 -4.7 9.2 0.7 0.1 0.7 -0.2 -20 -40 5 10.8 1.9 10.6 5.2 1.2 2.0 -11.4 29 -12
Metals & Mining 9.7 33 6.1 16.7 7.9 -0.5 1.8 1.4 6.6 -6 -25 -9 11.2 2.3 5.8 2.3 1.4 0.1 -6.4 37 -9
Paper & Forest Products 0.1 4 29.2 37.6 30.2 0.4 -3.1 0.3 -4.5 -100 -100 0 11.8 1.8 9.4 2.6 0.4 -3.4 -26.5 -35 -36
Industrials 12.0 137 1.9 21.1 24.6 -0.3 0.0 -0.4 -1.5 -28 -24 -6 14.6 2.1 8.6 2.5 0.6 -2.0 -13.4 17 -16
Building Products 0.1 2 20.8 19.8 6.3 -1.2 -1.0 -0.8 -1.0 -50 50 -50 16.8 1.5 10.5 1.3 2.7 8.8 -11.5 57 -12
Construction & Engineering 2.4 18 21.2 27.0 34.7 1.1 2.5 0.1 -1.5 22 -11 -6 17.6 3.4 10.7 1.6 0.5 -6.1 -18.4 63 -18
Electrical Equipment 0.7 11 23.8 25.9 37.7 -0.6 -3.5 -0.9 -2.1 -27 -55 -18 16.9 2.6 11.4 1.5 0.4 -1.7 -16.1 34 -19
Machinery 1.5 14 37.3 29.6 50.3 -0.8 -1.4 -1.2 -2.0 -71 -14 -36 9.8 2.6 6.7 1.7 0.2 -1.5 -16.8 43 -22
Trading Companies & Distrib 0.4 6 4.4 20.3 33.4 -0.4 -0.1 0.1 0.2 20 -20 -40 19.2 1.8 13.7 1.2 0.6 -4.6 -13.8 44 -23
Commercial Services & Supp 0.5 4 9.1 12.4 12.0 1.1 1.1 1.4 0.8 -25 -75 50 15.8 5.4 8.6 3.8 1.3 -5.8 -4.9 -29 -15
Airlines 0.8 13 35.8 12.5 0.9 -1.2 -0.9 -2.0 -3.8 -15 15 -46 11.7 1.4 6.5 3.8 12.4 0.2 -9.9 8 -15
Marine 1.0 18 -10.2 13.6 22.8 0.3 -2.8 -0.8 -7.4 -76 -65 35 9.2 1.6 6.2 3.9 0.4 2.9 -9.0 44 -11
Road & Rail 0.4 5 -3.8 17.7 6.0 -0.1 2.6 -0.1 -1.3 -20 -20 -20 19.8 1.7 11.5 4.4 3.3 -2.6 -10.1 -6 -11
Consumer Discretionary 5.6 83 16.7 15.7 21.6 0.8 0.1 0.5 -0.3 -16 -16 6 13.1 1.9 8.5 3.2 0.6 -2.3 -8.0 -4 -13
Auto Components 0.3 5 11.5 8.5 17.2 -0.7 -3.0 -0.5 -2.5 -60 -60 -40 8.6 1.4 6.3 2.3 0.5 -3.1 -10.8 1 -15
Automobiles 1.1 15 24.5 16.8 14.2 1.7 0.6 0.8 -0.2 14 14 71 10.1 1.2 6.3 2.0 0.7 -3.9 -6.6 -1 -9
Household Durables 0.4 7 52.6 9.2 67.4 1.9 4.8 1.2 2.1 0 0 20 8.5 1.6 7.0 1.8 0.1 -4.6 -6.3 17 -11
Textiles, Apparel & Luxury G 0.3 9 17.4 31.9 15.3 -2.4 -4.2 -1.4 -3.2 -57 -43 0 10.8 1.5 7.5 3.2 0.7 -3.4 -10.8 -19 -19
Hotels, Restaurants & Leisur 1.3 16 1.7 12.0 13.6 0.7 -0.6 0.2 -1.1 -25 -25 -31 17.0 2.3 9.4 4.2 1.2 -1.4 -7.1 -13 -10
Media 0.5 12 7.5 17.7 14.4 0.6 0.8 0.6 0.6 -9 -9 18 16.0 2.1 9.7 5.3 1.1 0.3 -7.0 -12 -10
Retailing 1.5 15 12.5 18.5 23.9 0.4 0.5 0.4 0.6 0 -7 -7 17.6 3.4 11.5 2.9 0.7 -1.8 -9.1 11 -18
Consumer Staples 5.1 47 1.9 16.3 14.4 0.8 1.0 1.1 2.3 -5 -5 -16 17.6 3.1 11.3 3.3 1.2 -0.8 -9.1 13 -10
Food & Staples Retailing 2.2 8 5.2 19.6 10.1 0.8 -1.2 1.7 1.9 -71 -57 -14 18.5 2.9 10.9 3.6 1.8 -1.7 -10.7 7 -14
Food, Beverage & Tobacco 2.5 33 -2.5 13.7 17.6 1.0 3.5 0.9 3.5 13 6 -15 16.5 3.0 11.4 3.1 0.9 0.3 -6.8 19 -5
Household & Personal Produ 0.4 6 19.7 17.3 19.5 -0.8 -1.4 -0.9 -1.6 -20 0 -20 20.7 6.6 14.8 2.6 1.1 -2.7 -13.2 12 -11
Health Care 1.2 15 21.2 20.0 19.4 1.0 0.9 0.8 0.6 27 27 27 19.4 4.4 13.5 2.0 1.0 -4.6 -9.0 12 -12
Biotechnology 0.5 1 26 29.3 23.1 1.5 1.6 1.6 1.4 100 -100 -100 22.3 7.6 15.4 1.5 1.0 -4.8 -7.3 40 -9
Pharmaceuticals 0.3 8 18.3 14.4 17.4 1.0 -0.8 0.3 -1.5 13 13 38 16.1 3.0 12.2 1.2 0.9 -4.0 -11.7 -1 -16
Financials 33.1 186 9.3 13.8 17.2 0.2 0.2 0.2 0.4 -34 -24 3 12.7 1.8 16.0 4.0 0.7 -3.2 -12.3 -4 -16
Banks 17.1 70 15.9 11.9 13.2 0.4 0.3 0.5 0.2 -21 -17 -3 11.2 1.7 18.4 4.8 0.9 -4.3 -10.8 -8 -14
Capital Markets 1.2 14 1.2 10.2 15.4 -0.8 -3.5 -0.5 -2.2 -83 -67 0 9.5 1.4 11.3 4.6 0.6 -6.8 -17.0 -4 -24
Insurance 4.1 15 -3.4 12.9 19.5 -1.0 -0.1 -0.4 1.4 -87 -47 -27 14.2 2.4 8.5 3.8 0.7 -3.0 -14.8 -7 -20
Information Technology 11.2 93 17.1 16.2 18.3 0.1 -4.6 -0.2 -3.7 -51 -52 -6 11.4 1.8 5.6 3.2 0.6 -3.6 -3.9 -11 -14
Internet Software & Service 0.6 4 45.7 32.7 42.5 0.6 2.2 0.2 0.9 100 100 50 28.8 9.7 20.6 0.5 0.7 -4.0 -15.4 60 -16
IT Services 1.1 7 NA NA NA NA NA NA NA NA NA NA NA 4.5 11.5 1.5 NA 2.0 -4.4 -28 -14
Software 0.0 1 36.1 33.9 2.0 -0.3 -3.2 -0.3 -1.5 -100 -100 100 13.3 1.7 7.5 NA 6.6 -5.6 -7.2 -19 -11
Communications Equipment 0.2 5 17.0 20.9 14.7 0.1 -3.1 0.0 -2.2 -100 -100 -60 10.3 2.1 7.1 4.5 0.7 -5.6 -17.5 -34 -27
Computers & Peripherals 1.5 21 13.7 17.3 22.1 0.9 -3.7 0.8 -5.3 -68 -79 -47 9.4 1.8 6.5 5.0 0.4 -3.0 -10.3 -13 -22
Electronic Equip. & Instr. 2.4 26 41.7 3.1 24.9 1.3 1.2 -0.4 -3.2 -43 -43 14 8.4 1.5 4.3 3.0 0.3 -3.6 -10.0 -5 -21
Office Electronics 0.0 1 NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA -1.8 -3.2 -19 -9
Semiconductors 5.4 28 4.8 25.1 12.9 -0.9 -9.3 -0.3 -3.9 -63 -58 -21 12.6 1.5 5.3 3.3 1.0 -4.8 3.4 -11 -7
Telecom. Services 7.6 30 -4.5 13.4 17.6 -0.1 -1.1 -0.2 -1.2 -24 -21 3 15.7 2.9 6.9 3.4 0.9 -0.3 -9.1 29 -10
Diversified Telecom. Service 3.3 17 6.2 8.1 8.6 0.4 -0.8 0.3 -1.0 0 6 25 14.2 2.4 6.4 4.4 1.7 2.5 -3.5 13 -3
Wireless Telecom. Services 4.4 13 -12.1 18.0 23.5 -0.4 -1.3 -0.6 -1.3 -54 -54 -23 17.0 3.4 7.3 2.8 0.7 -2.4 -12.8 45 -15
Utilities 3.0 36 1.2 4.5 7.3 -1.2 -2.5 -1.8 -3.3 -33 -18 -6 14.6 1.4 9.8 3.2 2.0 -3.9 -10.5 7 -11
Electric Utilities 1.4 10 -0.1 -0.8 2.2 -2.5 -3.1 -3.2 -3.8 -30 -20 20 13.8 1.1 9.9 3.4 6.4 -5.5 -7.2 5 -5
Gas Utilities 0.7 7 -5.0 10.6 13.9 1.4 1.6 0.6 1.2 33 33 0 19.2 3.4 13.7 2.2 1.4 -0.8 -9.4 37 -12
Note : Above table is as of Feb. 13, 2008.
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Feb 15, 2008 MIRAE ASSET RESEARCH 8

AP Insight
Table 3. FY08 Forecast Earnings Change (1M)
AP ex JP Australia China Hong India Indonesia Japan Korea Malaysia New Philippines Singapore Taiwan Thailand
Kong Zealand
Market -0.1 0.8 1.1 0.5 0.7 3.7 -2.6 -0.6 -0.1 -0.5 -0.6 -1.0 -6.1 0.9
Energy 3.7 2.6 3.8 NA 2.3 29.5 -6.9 -7.5 0.7 NA 0.8 0.8 0.0 3.2
Materials 1.4 4.7 -0.6 -1.6 2.9 0.2 -2.0 -1.9 -0.3 -0.9 NA NA -0.3 -5.9
Industrials 0.0 -1.0 0.9 -0.7 0.7 -12.8 -0.6 0.2 -0.9 -1.3 0.0 -2.6 -7.7 -8.8
Consumer Discretionary 0.1 -3.2 0.9 0.4 -0.2 5.8 -3.3 -0.2 1.2 1.5 -3.9 1.7 -9.4 2.2
Consumer Staples 1.0 0.6 3.1 0.9 0.1 4.7 -2.2 -1.3 2.4 NA -5.9 3.8 26.1 -2.1
Health Care 0.9 -0.2 NA NA 0.8 0.6 -2.3 -3.7 NA 0.3 NA -0.3 NA NA
Financials 0.2 -0.6 0.9 1.2 1.9 -0.4 -3.3 -2.0 -1.0 0.0 -0.7 -1.1 -4.6 1.0
I T -4.6 -1.1 -8.7 -1.9 -1.1 NA -4.4 0.9 0.0 NA NA -1.4 -8.7 -1.3
Telecom. Services -1.1 -2.3 0.1 0.9 -1.3 -1.0 1.1 -5.9 -1.1 -1.2 -0.4 0.2 -7.2 0.6
Utilities -2.5 0.7 -3.1 -0.1 -6.1 -2.3 -3.8 -7.6 0.5 -0.5 0.5 NA NA 0.4
Note : Above table is as of Feb. 13, 2008.
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Table 4. 12-month Forward P/E
AP ex JP Australia China Hong India Indonesia Japan Korea Malaysia New Philippines Singapore Taiwan Thailand
Kong Zealand
Market 13.1 12.7 15.1 17.4 18.0 14.7 13.1 10.5 15.3 12.7 13.9 12.7 11.1 11.2
Energy 13.4 16.6 12.8 NA 17.3 20.2 11.0 7.7 14.1 NA 7.0 6.3 10.0 10.1
Materials 11.3 12.0 13.8 9.1 9.5 12.6 10.2 10.0 16.2 8.9 NA NA 10.3 10.1
Industrials 14.6 17.1 16.2 16.3 24.3 17.2 11.9 12.0 16.3 28.4 15.2 12.4 13.1 11.6
Consumer Discretionary 13.1 14.8 16.7 18.9 12.5 13.7 11.8 8.8 17.2 13.8 16.1 14.6 13.7 18.8
Consumer Staples 17.6 17.3 15.9 31.1 19.9 16.6 20.6 16.8 20.1 NA 14.5 22.4 17.7 14.6
Health Care 19.4 20.8 NA NA 16.6 11.7 15.0 16.9 NA 24.6 NA 24.3 NA NA
Financials 12.7 11.1 14.2 17.8 23.5 12.8 12.6 8.3 13.4 15.8 15.3 11.9 13.5 12.3
I T 11.4 14.5 17.9 14.6 15.5 NA 15.2 11.5 11.2 NA NA 7.7 10.5 7.0
Telecom. Services 15.7 15.3 18.7 20.2 18.6 13.2 14.4 10.2 16.1 10.8 13.7 15.3 12.7 17.2
Utilities 14.6 14.1 14.2 16.7 20.9 14.3 25.1 11.1 12.8 16.8 10.6 NA NA 8.5
Note : Above table is as of Feb. 13, 2008.
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Table 5. Performance (1M)
AP ex JP Australia China Hong India Indonesia Japan Korea Malaysia New Philippines Singapore Taiwan Thailand
Kong Zealand
Market -10.5 -7.7 -16.6 -13.3 -20.7 -5.0 -6.9 -7.3 -6.0 -8.9 -8.2 -9.8 -5.1 5.6
Energy -15.5 -8.3 -18.7 NA -23.7 11.0 -14.3 -26.2 -7.5 NA 0.0 -17.3 -18.1 1.8
Materials -7.8 -2.1 -24.2 -37.7 -21.5 -11.0 -16.8 -7.6 -8.3 -17.3 NA NA -10.0 -2.8
Industrials -13.4 -3.8 -14.8 -13.0 -23.4 -0.6 -3.8 -16.3 -7.8 -2.2 -14.7 -14.2 -3.2 4.3
Consumer Discretionary -8.0 -7.0 -18.8 -5.1 -15.3 -12.4 -5.5 -5.7 -3.9 -7.2 0.0 -6.7 -7.9 10.4
Consumer Staples -9.1 -10.0 -12.5 -13.5 -12.7 -10.9 -5.1 -7.0 -3.5 NA -13.2 -17.4 1.8 9.2
Health Care -9.0 -7.8 NA NA -13.2 -7.1 -7.7 -5.4 NA -15.8 NA -8.0 NA NA
Financials -12.3 -11.3 -17.5 -16.3 -21.6 -10.0 -6.8 -8.8 -7.1 -5.9 -10.6 -10.4 8.2 12.9
I T -3.9 -7.7 -8.3 -18.3 -3.9 NA -9.7 6.7 -2.7 NA NA -12.3 -7.6 2.2
Telecom. Services -9.1 1.6 -13.2 -4.9 -30.0 -3.8 -5.0 -5.4 -5.7 -5.5 -3.1 -0.5 1.5 10.4
Utilities -10.5 -9.3 -13.9 0.1 -31.8 -18.6 3.8 -5.5 -4.2 -8.5 -5.8 NA NA -0.6
Note : Above table is as of Feb. 13, 2008.
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Feb 15, 2008 MIRAE ASSET RESEARCH 9

AP Insight
Table 6. Asia Pacific Company Map : Top and Bottom of 1M EPS Change & 1M Performance
Energy Materials Industrials Consumer Consumer Health Financials IT Telecomm. Utilities
Discretionary Staples Care Services
Australia WorleyParsons Newcrest Mining Leighton Holdings Pacific Brands Goodman Fielder Ansell Bendigo Bank AGL Energy
1.3 / -6.5 9.9 / 6.8 0.7 / 3.3 0.1 / -2.2 0.0 / 2.6 1.2 / 6.5 0.7 / -11.6 0.4 / 3.1
Paladin Energy Alumina Asciano Group Crown Futuris Cochlear Perpetual Computershare Telstra
-11.2 / 10.4 -27.0 / -1.6 -3.4 / -4.7 -4.4 / 1.9 -2.0 / -8.4 -1.1 / -13.3 -4.1 / -10.1 -0.9 / 5.7 -0.2 / 4.5
China Inner Mongolia Yita China Molybdenum China Eastern Airlin Dongfeng Motor Gr Global Bio-Chem Te China Insurance InteLenovo Group China Communicati China Resources P
50.1 / -2.9 1.1 / -2.0 154.2 / 7.0 2.7 / 2.4 7.6 / 9.1 8.6 / 3.3 6.9 / 5.9 2.5 / 0.3 0.9 / -4.9
China Petroleum & Shougang Concord Citic Resources HoldFU JI Food & CaterinChina Mengniu Dair Bank of China ZTE CORP H China Telecom Guangdong Electri
-1.0 / -1.4 -10.1 / -1.0 -16.2 / 4.7 -8.7 / -5.8 -1.4 / -2.4 -4.7 / -2.8 -0.2 / -0.2 -0.7 / 2.5 -2.8 / -1.6
Hong Fosun International Melco International Lifestyle Internation Hang Lung PropertieKingboard Chemica PCCW Hong Kong & Chin
Kong 0.0 / -6.6 12.2 / 3.3 3.1 / 2.1 4.1 / 1.1 0.7 / -0.8 1.4 / -0.4 0.6 / 2.6
Lee & Man Paper MHutchison Whampo Yue Yuen Industrial Chinese Estates (HoFoxconn Internation Hutchison TelecommHongKong Electric
-4.5 / -5.5 -2.3 / -1.9 -4.1 / -3.6 -5.9 / -1.6 -2.1 / -7.6 -1.5 / -1.8 0.0 / 0.1
Indonesia Bumi Resources Indocement TunggaUnited Tractors Astra International Astra Agro Lestari Kalbe Farma Bank Danamon Ind Indosat
-2.3 / -0.7 5.3 / -0.7 8.7 / -2.7 5.7 / -0.4 4.3 / -5.4 0.1 / 0.0 0.7 / -0.7 -0.2 / 1.4
Energi Mega PersadInternational Nickel Truba Alam Manun Ramayana Lestari S Gudang Garam Bank Mandiri (Perse Telekomunikasi Ind Perusahaan Gas N
-21.7 / -4.5 -0.2 / 4.1 -21.7 / -3.2 0.8 / 1.4 0.0 / -0.6 -1.0 / -2.3 -0.4 / 1.5 -0.6 / -2.0
India Cairn India Jindal Steel & Powe Jaiprakash Associat Indian Hotels ITC Sun Pharmaceutical Infrastructure Devel HCL Technologies Mahanagar TelephoGAIL (India)
33.9 / -1.7 15.9 / -13.6 4.1 / -26.9 2.6 / -13.1 0.7 / -1.9 14.7 / -0.2 7.9 / -13.9 0.7 / -4.7 1.4 / -6.7 2.9 / -8.7
Bharat Petroleum Sterlite Industries (InGMR Infrastructure Bajaj Auto United Spirits Dr. Reddy's LaboratIndiabulls Financial SWipro Videsh Sanchar Nig Tata Power
-1.6 / -2.4 -7.9 / -7.2 -12.1 / -16.5 -2.4 / -13.6 -5.6 / -6.9 -10.3 / -4.2 -4.4 / -5.4 -3.2 / -3.5 -4.3 / -7.1 -6.1 / -14.8
Japan Japan Petroleum Ex Sumitomo Osaka C Odakyu Electric Rai Sanyo Electric Sapporo Holdings Taisho Pharmaceuti Acom Konami Nippon Telegraph &The Chugoku Elect
0.0 / 3.0 2.6 / 2.1 10.8 / -1.6 184.4 / 6.6 13.5 / -4.9 11.6 / -0.2 15.0 / 4.5 3.2 / 2.2 2.5 / -0.4 0.1 / 2.7
TonenGeneral SekiyMitsubishi Rayon Ebara Sega Sammy HoldinHouse Foods Chugai Pharmaceut Orix Advantest Softbank Hokuriku Electric P
-25.8 / 0.6 -30.4 / -4.1 -11.0 / -9.8 -97.3 / -25.9 -9.6 / -1.4 -32.8 / 2.6 -16.4 / -9.7 -44.7 / -4.5 -8.0 / 4.7 -14.3 / 4.0
Korea GS Holdings Honam PetrochemicKumho Industrial LG Electronics CJ CheilJedang Yuhan Mirae Asset Securit LG Philips LCD KT Korea Gas
-0.9 / -9.4 1.1 / 0.6 6.7 / -2.1 13.1 / -5.1 4.1 / 0.7 -3.4 / -1.8 1.0 / -7.9 8.4 / 2.1 -1.5 / 0.4 6.5 / -5.8
SK Energy Samsung Fine ChemDoosan Kia Motors Amorepacific Corp. Hanmi Pharmaceuti Korean ReinsuranceHynix SemiconductoLG TeleCom Korea Electric Pow
-15.8 / -11.8 -6.7 / -5.6 -16.0 / 0.0 -20.8 / -2.6 -3.2 / -5.3 -4.0 / 6.0 -9.5 / -6.5 -42.3 / -1.0 -6.8 / 0.4 -5.3 / -4.5
Malaysia Petronas Dagangan Lafarge Malayan CeMalaysian Airline SyUMW Holdings Bhd Kuala Lumpur Kepo Multi-Purpose Holdi DiGi.com Bhd Petronas Gas Bhd
0.0 / 1.2 0.3 / 0.9 7.3 / 1.8 0.2 / -0.7 2.8 / 3.9 26.4 / -2.3 0.1 / 2.1 1.9 / 0.0
Scomi Group Bhd Malaysian Bulk Car Astro All Asia Netw Guinness Anchor Bh Bursa Malaysia Bhd Telekom Malaysia BYTL Corp. Bhd
-1.2 / 2.3 -5.7 / 1.0 -16.5 / 3.6 -0.3 / 0.0 -6.9 / -2.3 -0.5 / 1.8 -1.9 / 1.9
New Sky Network Televi Fisher & Paykel Hea Contact Energy
Zealand 0.2 / -1.0 0.8 / -5.0 0.0 / -3.3
Fletcher Building Auckland Internatio Fisher & Paykel App Telecom Corp. of N Vector
-0.5 / -9.7 -0.7 / -2.2 -0.9 / -5.5 -3.8 / -3.2 -1.6 / 0.0
Philippines Petron Ayala Land Philippine Long Dist First Philippine Hold
1.2 / 0.0 0.5 / 1.9 0.2 / 0.3 5.9 / 1.0
Jollibee Foods San Miguel Metropolitan Bank Globe Telecom PNOC Energy Deve
-1.7 / 4.2 -5.9 / -0.9 -5.6 / -1.2 -0.5 / -1.9 -0.4 / 1.7
Singapore Singapore Petroleum SembCorp Marine Genting Internation Olam International Parkway Holdings CapitaLand Singapore Telecomm
0.3 / -4.9 1.5 / 5.5 2.4 / 2.5 0.0 / -1.5 1.3 / -1.7 2.6 / 3.2 0.4 / 5.7
Singapore Airlines Jardine Cycle & Car Wilmar Internationa UOL Group Venture
-6.5 / 0.4 -0.6 / 2.9 -1.2 / 1.7 -28.0 / 1.6 -0.8 / -2.7
Thailand Banpu PTT Chemical Airports of Thailand BEC World CP ALL Thanachart Capital Hana Microelectron Ratchaburi Electric
7.3 / 6.3 1.8 / 5.9 18.9 / -1.8 0.6 / 0.0 -0.1 / 0.9 3.1 / 9.9 0.4 / 0.5 2.0 / 0.6
PTT Aromatics & ReSiam Cement Precious Shipping Siam Makro TMB Bank Advanced Info Servi Glow Energy
-2.2 / 2.6 -8.4 / 0.9 -3.8 / 13.2 -0.3 / -0.5 -13.9 / 3.2 -2.1 / 13.2 0.1 / 0.8
Taiwan Eternal Chemical Evergreen Marine CFar Eastern Departm Polaris Securities AU Optronics Far EasTone Teleco
2.9 / -0.3 61.6 / 0.6 4.1 / 2.1 10.9 / -1.5 7.1 / -0.9 -0.5 / 1.4
Taiwan Cement Walsin Lihwa Yulon Motor President Chain Sto Taishin Financial Ho Powerchip Semicon Taiwan Mobile
-3.1 / 4.3 -12.2 / -3.2 -3.8 / 1.3 -0.1 / 4.1 -28.5 / -4.7 -147.3 / -4.2 -4.1 / 0.0
Note : Above table is as of Feb. 13, 2008.
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Feb 15, 2008 MIRAE ASSET RESEARCH 10

AP Insight
Asia Pacific Country & Sector Rating for February
Young Jean Hwang
82-2-3774-1780 / YoungJean@miraeasset.com
Table 1. Asia Pacific Country Rating for February
Asia Pacific Country Rating by Median Z-score of 6 Criteria
India
13-Country Rank's Z-score
30%
40%
-0.5 0
Negative Neutral
Indonesia
China
Hong Kong
Singapore
Thailand
Philippines
Korea
Malaysia
New Zealand
Taiwan
Japan
Australia
30%
0.5
Positive
Positive
Momentum 1 Momentum 2 Growth Profitability Valuation Liquidity
(Breadth) (Magnitude)
12m Fw. EPS Wtd. Avg. of Wtd. Avg. of Wtd. Avg. of Median Z-score of Money Supply Growth
Monthly FY08 & FY09 EPS FY08 & FY09 EPS FY08 & FY09 12m Fw. P/E, P/B, less Target Policy Rate
Revision Ratio Monthly Change Growth (YoY) ROE EV/EBITDA (Distance from
(13 Countries Rank) (13 Countries Rank) (13 Countries Rank) (13 Countries Rank) (13 Countries Rank) Median since 2000)
Positive Positive Positive Positive Negative Positive
Z-score (1.00) 0.92 1.00 1.33 1.00 -4.41 3.66
Positive
Positive Neutral Neutral Positive Negative Positive
Z-score (0.97) 1.91 -0.13 0.02 4.24 -1.00 2.27
Positive
Positive Positive Positive Positive Negative Negative
Z-score (0.71) 0.78 1.91 1.39 0.63 -1.69 -0.60
Positive
Positive Positive Neutral Negative Negative Positive
Z-score (0.65) 1.02 1.71 0.27 -2.97 -3.63 5.56
Neutral
Positive Neutral Negative Negative Positive Positive
Z-score (0.29) 1.24 0.00 -1.86 -1.20 0.57 3.62
Neutral
Neutral Neutral Neutral Positive Positive Negative
Z-score (0.03) 0.00 0.06 0.00 0.52 1.03 -2.71
Neutral
Neutral Neutral Neutral Negative Neutral Negative
Z-score (-0.20) -0.15 0.35 0.32 -0.57 -0.26 -0.88
Neutral
Negative Negative Neutral Negative Positive Positive
Z-score (-0.35) -1.00 -1.06 0.30 -1.28 1.84 1.02
Neutral
Neutral Positive Negative Negative Neutral Neutral
Z-score (-0.35) 0.19 2.82 -3.58 -0.99 -0.28 -0.43
Neutral
Negative Neutral Negative Neutral Neutral Negative
Z-score (-0.45) -1.16 -0.02 -2.39 0.00 0.00 -0.87
Negative
Negative Negative Neutral Neutral Positive Negative
Z-score (-0.51) -0.90 -1.59 -0.12 0.01 1.00 -3.84
Negative
Negative Neutral Negative Negative Neutral Positive
Z-score (-0.62) -1.01 -0.23 -1.03 -3.45 0.23 0.80
Negative
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Negative Negative Negative Positive Negative Positive
Z-score (-0.91) -1.03 -1.67 -1.00 1.00 -0.82 4.23
Feb 15, 2008 MIRAE ASSET RESEARCH 11

AP Insight
Table 2. Asia Pacific ex. Japan Sector Rating for February
Asia Pacific ex. Japan Sector Rating by Median Z-score of 5 Criteria
30%
21-Sector Rank's Z-score
40%
-0.5 0
Negative Neutral
30%
0.5
Positive
Momentum 1 Momentum 2 Growth Profitability Valuation
(Breadth) (Magnitude)
12m Fw. EPS Wtd. Avg. of Wtd. Avg. of Wtd. Avg. of Median Z-score of
Monthly FY08 & FY09 EPS FY08 & FY09 EPS FY08 & FY09 12m Fw. P/E, P/B,
Revision Ratio Monthly Change Growth (YoY) ROE EV/EBITDA
(21 Sectors Rank) (21 Sectors Rank) (21 Sectors Rank) (21 Sectors Rank) (21 Sectors Rank)
Internet Software
& Services Positive Positive Positive Positive Negative
Z-score (3.39) 4.20 1.73 3.39 8.61 -7.12
Household Durables
Positive Positive Positive Positive Neutral
Z-score (2.14) 2.38 2.14 5.23 0.63 0.29
Electronic Equipment
& Instruments Neutral Positive Positive Neutral Positive
Z-score (1.15) -0.30 2.18 2.94 0.03 1.15
Marine
Automobiles
Airlines
Energy
Machinery
Pharmaceuticals
Positive Positive Positive Neutral Positive
Z-score (0.86) 1.00 0.86 0.86 0.41 1.00
Positive Neutral Positive Negative Positive
Z-score (0.71) 2.11 0.00 0.72 -3.03 0.71
Negative Positive Positive Negative Positive
Z-score (0.63) -2.01 0.86 1.89 -2.94 0.63
Positive Positive Neutral Positive Negative
Z-score (0.58) 1.97 1.44 0.49 0.58 -0.79
Neutral
Neutral Negative Positive Positive Neutral
Z-score (0.43) -0.44 -1.39 2.62 4.18 0.43
Neutral
Positive Negative Neutral Neutral Negative
Z-score (0.12) 1.16 -1.14 0.15 0.12 -1.94
Construction
& Engineering
Neutral
Neutral Neutral Positive Neutral Negative
Z-score (0.08) 0.08 -0.07 1.19 0.15 -2.62
Banks
Positive
Positive
Positive
Positive
Positive
Positive
Positive
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Neutral
Neutral Positive Neutral Negative Neutral
Z-score (0.00) 0.00 1.00 0.00 -1.36 -0.14
Feb 15, 2008 MIRAE ASSET RESEARCH 12

AP Insight
Table 2. Asia Pacific ex. Japan Sector Rating for February (Continued)
Asia Pacific ex. Japan Sector Rating by Median Z-score of 5 Criteria
30%
21-Sector Rank's Z-score
40%
-0.5 0
Negative Neutral
Telecom. Services
Chemicals
Capital Markets
Retailing
Auto Components
Metals & Mining
Consumer Staples
Utilities
Insurance
Semiconductors
30%
0.5
Positive
Momentum 1 Momentum 2 Growth Profitability Valuation
(Breadth) (Magnitude)
12m Fw. EPS Wtd. Avg. of Wtd. Avg. of Wtd. Avg. of Median Z-score of
Monthly FY08 & FY09 EPS FY08 & FY09 EPS FY08 & FY09 12m Fw. P/E, P/B,
Revision Ratio Monthly Change Growth (YoY) ROE EV/EBITDA
(21 Sectors Rank) (21 Sectors Rank) (21 Sectors Rank) (21 Sectors Rank) (21 Sectors Rank)
Neutral
Neutral Neutral Neutral Neutral Negative
Z-score (-0.05) -0.25 0.13 -0.05 0.00 -1.43
Neutral
Positive Neutral Negative Negative Neutral
Z-score (-0.13) 0.89 -0.13 -1.00 -1.44 0.01
Neutral
Neutral Neutral Negative Negative Neutral
Z-score (-0.21) -0.21 0.12 -1.44 -1.14 0.37
Neutral
Positive Neutral Neutral Neutral Negative
Z-score (-0.33) 1.53 -0.35 -0.33 0.33 -2.39
Neutral
Negative Neutral Neutral Negative Positive
Z-score (-0.44) -1.44 -0.33 -0.44 -0.70 0.57
Negative
Negative Negative Negative Positive Neutral
Z-score (-0.87) -2.03 -2.73 -0.87 2.39 0.13
Negative
Positive Positive Negative Negative Negative
Z-score (-0.87) 0.61 1.77 -1.46 -0.87 -2.08
Negative
Neutral Neutral Negative Negative Negative
Z-score (-0.97) -0.25 -0.31 -1.56 -4.19 -0.97
Negative
Neutral Negative Negative Negative Negative
Z-score (-1.27) -0.37 -2.11 -1.92 -1.00 -1.27
Negative
Source : MSCI, I/B/E/S, FactSet, Mirae Asset Research
Negative Negative Neutral Negative Positive
Z-score (-1.68) -3.77 -2.04 -0.41 -1.68 0.51
Feb 15, 2008 MIRAE ASSET RESEARCH 13

AP Weekly Insight
Pharmaceutical
Key Call
CSL LTD
(CSL AU,BUY,TP A$42.04)
Sean Hwang
82-2-3774-1723 / shwang@miraeasset.com
New Era for Plasma Industry
New leader in newer healthcare marketplace
We initiate coverage on CSL Ltd. with a BUY rating and
fair value of AU$42.04, which is derived from our RIM
model under the assumption of 9% cost of equity.
Although this valuation appears demanding at 30.3x FY08
earnings, P/E is likely to fall as low as 17.0x to FY10.
CSL has established a leading position in the plasma
proteins market on the back of cutting-edge fractionation
technology and collecting power. Now the company is
expanding its presence into the biopharmaceutical market
led by its flagship product Guardasil, the cervical cancer
vaccine that was licensed to Merck.
Supply of plasma proteins to be tightened
The global plasma product market is a competitive
oligopoly, led by a few players such as CSL, Baxter, and
Tarcelo. Capital-intensive fractionating facilities and
difficulties in blood collection have existed as barriers to
new entrants into this market. The leading companies are
expected to benefit from a tight supply/demand balance
for plasma proteins as a result of recent M&As in the
industry.
In addition, global short supply in blood can prompt further
price hikes of plasma proteins and make the market share
more concentrated in the companies that are vertically
integrated. The company collected 4mn liters of plasma
through its collection centers worldwide and obtained an
additional 700,000 liters that were for sale to Talecris (5%
margin). After expiration of the supply agreement at the
end of 2008, CSL can internally process the plasma,
formally sold to Talecris, and sell it for a greater margin
(roughly 30%). In summary, the current blood shortage
expands the gap between vertically integrated players
such as CSL and Grifols and non-vertically integrated
players such as Talecris. Liquid IVIG’s indication
extension to Alzheimer (now performed by Baxter) could
be an important catalyst.
Expansion to biopharmaceutical encouraging
CSL is the only manufacturer of influenza vaccine in the
southern hemisphere and the inventor of world’s 1st
cervical cancer vaccine, Guardasil. Royalty income from
Merck will be the strongest contributing factor to earnings
growth over the next couple of years. Expanding to
various recombinant biopharmaceuticals is likely to send
CSL to a new leadership position in the global
pharmaceutical market.
Figure 1. Residual Income Model
(A$ mn) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
BVo 2,268.8
BV 3,025.93,784.04,737.95,942.67,444.89,288.9 11,560.914,446.6 17,571.3
ROE(%) 25.1 25.1 28.4 28.6 28.8 28.7 28.2 27.9 28.4
COE(%) 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.0
ROE-
COE
16.1 16.1 19.4 19.6 19.8 19.7 19.2 18.9 19.4
RI 488.6 611.0 919.41,162.81,472.91,826.7 2,221.6 2,736.8 3,412.4
PV RI 448.3 514.3 709.9 823.8 957.31,089.2 1,215.3 1,373.5 1,571.1 12,056.6
NAV
Shr
23,028.1
Outstand
ing
547.7
Fair price 42.04
Source: Mirae Asset Research Estimates
Figure 2. Global IVIG Market
(tonnes of IVIg)
Feb 15, 2008 MIRAE ASSET RESEARCH 14
140
120
100
80
60
40
20
0
Projection
'90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14 '16
Source: NBA, Mirae Asset Research
Figure 3. Financial and Operational figures
(A$ mn) 2005 2006 2007 2008E 2009E
Sales 2,749.9 2,848.9 3,172.4 3,688.7 4,444.7
EBITDA 410.5 155.3 678.2 1,002.1 1,433.1
Pre-tax NP 641.9 170.5 774.1 1,071.8 1,513.8
NP 546.5 117.4 539.3 760.9 1,074.8
EPS 0.93 0.21 0.98 1.39 1.96
YoY(%) 126.2 (76.9) 358.2 41.1 41.2
P/E(x) 12.1 83.4 29.8 25.2 17.9
P/B(x) 3.1 4.9 7.1 6.3 5.1
EV/EBITDA 7.8 30.7 17.5 15.0 11.0
ROE(%) 26.3 5.9 23.8 25.1 28.4
Source: Factset, Mirae Asset Research Estimates

AP Insight
Figure 4. Global Comparison
CSL Grifols Novo Baxter GSK Sanofi- Green
Nordisk
Aventis Cross
CSL-AU GRF-ES
NOVO.B-
DK
BAX-US GSK-GB SAN-FR 006280-KR
Avg Median 06/2007 12/2006 12/2006 12/2006 12/2006 12/2006 12/2006
Price History
Current Price 46.40 45.68 29.50 23.41 63.99 61.86 21.67 77.99 79.30
52 Week High 54.08 50.07 34.93 26.97 68.75 65.20 30.37 98.29 110.71
52 Week Low 35.85 30.43 18.17 13.95 40.82 48.10 20.05 74.00 52.31
Beta 0.76 0.74 0.92 0.99 0.71 0.57 0.62 0.76 0.72
Size
Market Value(US$ mn) 54,355.6 39,484.2 16,232.5 4,986.8 39,744.6 39,223.7 119,413.9 106,531.8 714.6
Enterprise Value 57,634.4 39,170.7 16,680.2 5,402.4 38,567.7 39,773.7 131,062.8 114,319.4 796.0
Sales 17,277.3 8,615.8 2,695.3 855.4 6,853.6 10,378.0 45,450.2 37,431.4 437.5
Assets 28,290.5 10,659.0 3,440.1 1,150.7 7,568.0 13,750.0 45,851.3 97,982.8 391.7
Valuation
LTM Price to Earnings 24.7 24.0 33.5 40.6 24.4 23.7 11.7 14.2 18.7
LTM EPS 3.69 1.80 0.98 0.40 13.45 2.61 0.94 3.76 4,008.00
FY1 Price to Earnings 21.3 21.0 26.7 38.2 22.5 19.5 11.2 9.7 -
FY1 EPS 2.96 2.39 1.10 0.61 2.85 3.18 1.93 8.06 -
FY2 Price to Earnings 17.3 18.7 20.7 26.3 20.2 17.2 10.6 9.0 -
FY2 EPS 3.30 2.61 1.43 0.89 3.17 3.60 2.05 8.66 -
NTM Price to Earnings 18.2 20.6 22.3 25.0 22.1 19.0 11.1 9.6 -
NTM EPS 3.09 2.42 1.32 0.94 2.90 3.25 1.95 8.16 -
Price to Book 6.3 6.5 8.0 8.9 6.6 6.2 6.3 1.6 3.6
Enterprise to Sales 4.3 4.1 5.9 5.8 4.7 3.5 2.9 2.8 1.9
Dividend Yield 1.9 1.1 1.1 0.4 1.1 1.2 4.6 3.3 1.0
Gross Margin 56.2 52.7 45.2 33.6 74.5 46.6 78.4 58.9 40.0
EBITDA Margin 28.8 29.7 30.0 15.6 29.5 23.6 39.0 35.3 15.3
Operating Profit Margin 21.0 20.0 21.4 15.2 23.3 18.6 32.3 15.2 13.5
Net Margin 15.2 15.4 17.0 7.0 16.7 13.5 23.2 14.1 8.6
Net Return on Assets 12.0 11.7 13.3 5.2 15.1 10.2 23.0 5.4 9.6
Net Return on Equity 24.3 21.8 23.8 12.3 21.4 22.3 57.4 8.8 19.0
Growth (Yr/Yr)
Sales Growth + 22.9 + 24.7 + 27.3 + 38.2 + 28.2 + 5.4 + 22.1 + 15.9 + 19.2
Gross Profit Growth + 26.8 + 26.1 + 43.2 + 29.4 + 32.4 + 13.2 + 22.8 + 19.6 + 34.5
Assets Growth + 12.7 + 15.4 + 15.8 + 23.0 + 16.3 + 15.1 + 6.8 - 0.8 + 33.9
Source: Factset, Mirae Asset Research
Feb 15, 2008 MIRAE ASSET RESEARCH 15

AP Insight
Metal & Mining
Initiation
Shougang Concord Int’l
(697 HK,BUY,TP HK$ 3.50)
EY Lee
852-2295-2529 / dooley@miraeasset.com
Major Beneficiary of Demand Growth
Initiate coverage with BUY rating and TP of HK$3.50
Our investment points for Shougang Concord Int’l are: 1)
significant top-line and bottom-line growth expected
following full-scale operation of new shipbuilding plate
works in 2007; 2) bright outlook for its steel manufacturing,
shipping, and electricity generation business; and 3) its
share price being undervalued after a recent sharp decline.
Our TP is equivalent to P/E of 12x to FY08 forecast EPS,
which is a 35% discount to the Hang Seng Index average
P/E. The discount was due to concerns over the possibility
of an additional rights issue.
Timely facility expansion to fuel earnings growth
In 2007, the company began operation of a newly
constructed slab plant (annual capacity of 2.6mn tons)
including two blast furnaces and a heavy plate plant
(annual capacity of 1.2mn tons) at Qinghuangdao Shouqin
(SQ). As such, we project FY07 sales to be up 97% YoY
and OP to be up 468.7% YoY. We also forecast sales and
EPS to expand at CAGR of 9% and 20.3%, respectively,
during 2007-10 on the back of Shouqin’s expected
increase in slab production capacity to 3mn tons p.a. and
heavy plate to 2mn tons p.a. through 2011.
Impressive strategy to secure iron ore mine
The company secured a 6.4% stake in Australian mine
explorer Australasian Resources Ltd. (ARH AU) for
AU$28mn in 2007. In February, the company also
acquired a 19.7% stake in Australian iron ore miner Mount
Gibson Iron Ltd. including a 10% option share. Such
investment in upstream process is expected to sustain the
company’s lofty profitability over the long haul.
Undemanding valuation to provide a bargain hunting
opportunity
The company’s share price recently plummeted due to
concerns over a rights issue in 2H07 and overall stock
market weakness despite its strong FY07 ROE forecast at a
hefty 37.8%. As such, P/E and EV/EBITDA have plunged to
6.2x and 6.0x, respectively. Accordingly, our TP presents a
83.3% upside from the current price.
Full-scale heavy plate facility on-line in April 2007
In 2004, SQ set up a two-phased investment plan to build a
slab facility with two blast furnaces and an integrated steel
mill with a heavy plate rolling line. It launched operations of
a slab facility according to the first phase plan and began
the trial operations of 4,300mm-wide heavy plate facility in
September 2006 for the second phase. Both facilities began
operations in April 2007 and production capacity for slab is
now 2.6mn p.a. and for plate is 1.2mn p.a.
Figure 1. Shougang Concord International: TP HK$3.50
Construction
Production
capacity
(1,000 tons)
Feb 15, 2008 MIRAE ASSET RESEARCH 16
Product
spec
Note
QZP 1993 800 plate 3000mm Procure slab from SQ
SQ 2004 2600 slab
Integrated steel mill with
two blast furnaces
1200 Plate 4300mm
Completed two-phased
investment, began
operations in April 2007
Source: Company Data, Mirae Asset Research estimates
Only listed player in the China’s Shougang Group
As the largest shareholder, Shougang Holdings owns a
40.2% stake in Shougang Concord Int’l. Shougang
Holdings’ largest shareholder is Shougang Corp., whose
largest shareholder is the City of Beijing. Shougang
Concord Int’l is the only listed company among Shougang
group companies. Listed on Hong Kong stock market in
1991, the company specializes in making heavy plate
products.

AP Insight
Figure 2. Shareholding Structure (as of Feb 2008)
JP
Morgan Chase,
2.79%
Public &
Institution,
37.57%
Baring
Asset,
4.97%
Cheung Carlo
Kong Tassara,
HLDGS,
6.43%
8.04%
Shougang
Holding,
40.20%
Source: Company Data, Mirae Asset Research estimates
Figure 3. Operation Margin by Business Segment
(%)
60
50
40
30
20
10
0
2006년
1H07
Steel Shipping Electricity Steel Trade
Source: Company Data, Mirae Asset Research estimates
Figure 4. Sales Contribution by Segment
Electricity, 4.2
Shipping, 2.6
Steel Trade,
14.4
Others, 0.9
Steel
Manufacture,
77.9
Source: Company Data, Mirae Asset Research estimates
Figure 5. OP Contribution by Segment
Shipping, 11.5
Steel
Manufacture,
80.7
Feb 15, 2008 MIRAE ASSET RESEARCH 17
Electricity,
6.1
Steel
Trade,
0.6
Others,
1.1
Source: Company Data, Mirae Asset Research estimates
Figure 6. Shougang’s Sales and OP Forecast
(mn HK$)
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
Operating income
Revenue
2003 2004 2005 2006 2007E 2008E 2009E 2010E
Source: Company Data, Mirae Asset Research estimates
(mn HK$)
3,500
3,000
2,500
2,000
1,500
1,000
Figure 7. Shougang Concord International: TP HK$3.50
Fiscal year Ended Dec. 2005 2006 2007E 2008E 2009E
Sales (HK$ mn) 4,570. 6,467. 12,745. 15,879. 15,970.
OP (HK$ mn)
0
208.6
5
420.9
8
1,664.4
6
2,161.7
0
2,386.0
EBITDA (HK$ mn) 287.7 679.7 2,139.0 2,745.5 2,993.4
Net Profit (HK$ mn) 305.0 221.6 1,515.9 2,045.9 2,283.9
EPS (HK$) 0.07 0.04 0.23 0.29 0.33
P/E (x) 7.6 11.4 7.8 6.2 5.5
P/B (x) 1.3 1.1 3.0 2.1 1.6
EV/EBITDA (x) 18.0 10.1 8.0 6.0 5.0
Source: Company Data, Mirae Asset Research estimates
500
0

AP Insight
Construction & Property
Industry Update
Chongqing - Glittering in Western China
Kaiser Choi
852-2295-2533 / kaiser.choi@miraeasset.com
Highlighted Company
Company Rating Current Price (Feb 13) Target Price
C C Land (1224.HK) Not Rated HK$9.88 –
Chongqing is a pilot reform city in western China
It is on China’s top agenda to accelerate the economic
development in western China following the country’s
success in wealth creation along its coastal regions. As
one of the most important cities in the west, Chongqing
has been selected as a “Trial Zone for Comprehensive
Reform” by the State Council with the aim to achieve
“coordinated rural and urban development.” Under China’s
planned economy, Chongqing will become the regional
economic center in western China. We expect that the city
will receive greater budget from the central government to
speed up the development of infrastructure and urbanrural
integration. More autonomy would also be given to
the local governments to carry out policies on land, credit
and preferential tax treatment.
Figure 1. GDP Growth Outpaced National Average
%
13.0
12.0
11.0
10.0
9.0
8.0
7.0
GDP YoY Growth
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Source: CEIC, Mirae Asset Research
China Chongqing
Home price catching up with income growth
We believe property markets in Chongqing remain healthy.
Although home price growth in the city has accelerated in
recent years, the increase has actually been supported by
solid income growth. Over the past decade, home prices
in Chongqing increased by 133%, in line with the 130%
growth in urban annual disposable income per capita. The
accelerating home prices have only caught up with income
growth, as illustrated in Figure 2.
Figure 2. No Bubble in Home Prices
Income vs Home Price in Chongqing
Feb 15, 2008 MIRAE ASSET RESEARCH 18
RMB
13,500
12,500
11,500
10,500
9,500
8,500
7,500
6,500
5,500
4,500
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
RMB/m 2
2,900
2,700
2,500
2,300
2,100
1,900
1,700
1,500
1,300
1,100
Urban Annual Disposable Income Per Capita (LHS) Residential Selling Price (RHS)
Source: CEIC, Statistical Information of Chongqing, Mirae Asset Research
Favorable supply-demand situation
Home supply had been in line with demand in Chongqing
until 2005 when the purchasing power of local residents
began to flow into the market and demand started to
outstrip supply, as illustrated in Figure 3. We estimate that
cumulative demand-supply gap should have widened to
about 11mn m 2 . With a total population of 28mn,
Chongqing’s urbanization rate was 48.3% in 2007. The
government plans to boost the rate to 52% by 2010 and to
80% by 2020, which should result in higher demand for
urban residential properties. Besides, local residents and
end-users still dominate the market (accounts for 91% of
total buyers). As Chongqing has been designated to
become the economic growth engine in western China, we
anticipate both real demand and investment demand will
continue to increase in the next few years, lending support
to further price growth.
Figure 3. Demand Outstrips Supply from 2005
'000m 2
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
Residential Supply vs Demand in Chongqing
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Residential Supply Residential demand
Source: CEIC, Statistical Information of Chongqing, Mirae Asset Research
C C Land has heavy exposure in western China
Amongst major mainland developers, C C Land (1224.HK)
has the heaviest exposure in western China. Virtually all of
its land reserves are located in the west, of which 65% lie
in Chongqing. Future prospects for the company are bright
in our view.
900

AP Insight
Shipping
Industry Update
NOL
(NOL.SP,BUY,TP SG$4.47)
Je Hyun Ryu
82-2-3774-1418 / jayryu@miraeasset.com
Stronger than Expected US Routes
NOL: FY07 earnings beat consensus estimates
NOL recorded FY07 revenue of US$8.2bn, in line with our
estimates, but OP of US$613mn exceeded our estimates
by 11.2%. The company’s revenue and OP also beat
consensus estimates by 2.2% and 23.8%, respectively.
We maintain our BUY rating and TP of SG$4.47.
Higher volume and freight rate
NOL’s FY07 freight volume and rate rose by 12.5% YoY
and 4.1% YoY, respectively. In particular, freight rate in US
routes only declined 1.5% YoY in 4Q07, while freight rate
for Europe and Asia routes increased by 25.2% YoY and
23.2% YoY, respectively, for the same period. Meanwhile,
4Q07 freight volume in US routes increased 23.4% YoY
and 19.7% QoQ.
Increasing backhaul volume from US exports
We believe strength in US routes is being fueled by
increasing backhaul volume from US exports. According to
the company, for every 10 FEUs in US routes that are full
headhaul, 6 FEUs are estimated to have been full
backhaul in FY07. This is a huge improvement from FY06
when the backhaul volume in US routes was only 5 FEUs
for every 10 FEUs headhaul. This improvement in the
backhaul volume was due to increasing demand for US
exports as a result of weak dollar.
Focus on better-than-expected US routes
NOL’s strong earnings improvement is due to growth in
container volume in Europe and Asia, and better-thanexpected
performance in US routes. NOL announced that
it will reduce supply to 50,000 TEU/week in 1Q08.
Effective supply control should tighten supply/demand
balance relative to sluggishness in the demand for US
routes.
Figure 1. FY07 Earnings Review
(US$mn, %) 2007E 2007P
Feb 15, 2008 MIRAE ASSET RESEARCH 19
Diff
(%,%p)
2006 (YoY) Consensus
Diff
(%,%p)
Revenue 8,161.9 8,160.0 (0.0) 7,263.5 12.3 7,982.1 2.2
OP 551.4 613 11.2 401.0 52.9 495.1 23.8
Pre-tax profit 563.1 585.9 4.0 272.8 114.7 508.7 15.2
NP 496.0 523.0 5.4 363.7 43.8 451.7 15.8
OP margin 6.8 7.5 0.8 5.5 2.0 6.2 1.3
Pre-tax
margin
6.9 7.2 0.3 3.8 3.4 6.4 0.8
Net margin 6.1 6.4 0.3 5.0 1.4 5.7 0.8
Source: NOL, Mirae Asset Research estimates
Figure 2. Operating Data for Container Lines
2005 2006 2007P 2008E 2009E
Freight volume (1,000 FEU) 1,946.0 2,097.0 2,358.0 2,452.2 2,625.0
Asia-Europe Trade 383.0 414.0 428.0 459.2 505.6
Transatlantic Trade 122.0 120.0 132.0 141.8 148.8
Transpacific Trade 710.0 730.0 832.0 818.4 890.3
Latin America Trade 139.0 165.0 182.0 202.2 208.2
Asia/Australia/Middle East 592.0 668.0 784.0 830.6 872.1
Freight rate (US$/FEU) 2,841 2,632 2,740 2,873 2,951
Total Europe 2,664 2,497 2,848 2,820 2,872
Total US 3,539 3,416 3,347 3,729 3,790
Asia/Australia/Middle East 1,991 1,689 1,877 1,860 1,953
Source: NOL, Mirae Asset Research estimates
Figure 3. Container Volume Results
4Q07P 3Q07
QoQ
(%,%p)
4Q06
YoY
(%,%p)
Freight volume (1,000 FEU) 670 564 18.8 580 15.5
Asia-Europe Trade 117 98 19.4 113 3.5
Transatlantic Trade 38 32 18.8 32 18.8
Transpacific Trade 243 203 19.7 197 23.4
Latin America Trade 55 44 25.0 45 22.2
Asia/Australia/Middle East 217 187 16.0 193 12.4
Freight rate (US$/FEU) 2,865 2,885 (0.7) 2,583 10.9
Total Europe 3,161 2,978 6.1 2,524 25.2
Total US 3,312 3,462 (4.3) 3,362 (1.5)
Asia/Australia/Middle East 2,041 2,060 (0.9) 1,657 23.2
Source: NOL, Mirae Asset Research estimates

AP Insight
Auto Parts
Industry Update
Strong Potential in Key Emerging Markets
Jaewoo Kim
82-2-3774-2193 / jwkim21@miraeasset.com
Our View on Highlighted Companies
Company Rating
Current Price
Target Price
(Feb 13)
S&T Daewoo (064960.KS) BUY W27,400 W65,000
Dongyang Mech. (013570.KS) BUY W5,610 W16,000
Global automakers responding to demand for low-end
cars are likely to see qualified Korean auto parts makers
benefit from this industry trend.
At the moment, global automakers are categorized into
two groups: 1) fast growing automakers based in Asia;
and 2) slow-growing automakers in North America and
Europe. Facing different circumstances, each group has
different strategies and goals. However, both groups share
a common need for auto parts makers that are competitive
in price and high in quality.
Securing auto parts makers to meet continued production
capacity expansion is vital for fast-growing automakers. To
do so, they are likely to seek new auto parts makers with
quality and price competitiveness, while encouraging
existing auto parts makers to expand investment.
For slow-growing automakers, cost structure improvement
is key. These companies are also likely to want auto parts
makers with strong price competitiveness and good quality
products.
If automakers are focused more on competitive pricing
than on quality, they are likely to contract with China auto
parts makers. However, if automakers want both quality
and price competitiveness, they are likely to turn to
qualified auto parts makers in Korea.
Recently, GM steadily increased orders to domestic auto
parts makers including S&T Daewoo and Dongyang
Mechatronics. As such, global automakers are very likely
to pay more attention to Korean auto parts makers as they
seek new growth engines in key emerging markets with
improved price competitiveness.
Therefore, we recommend investors to keep close eyes on
S&T Daewoo and Dongyang Mechatronics which have
already secured strong potential to expand supplies to
global auto manufacturers and are expected to see
positive earnings performance in the mid- to long-term
perspective.
Figure 1. Global Automakers Interested in
Outstanding Domestic Auto Parts Makers
Fast growing group
Feb 15, 2008 MIRAE ASSET RESEARCH 20
Japan
Japan
South South Korea Korea
China
China
Slow growing group
Germany Germany
USA
USA
Other Other Europe Europe
• Active expanding
capacity
• Nurturing new auto
parts makers
Increasingly
necessary
• Continued efforts for
restructuring
• Further cost saving
increasingly
necessary
Source: WardsAuto, Mirae Asset Research estimates
• Auto parts makers
with quality and
price
competitiveness
capture increasing
attention
• Competitiveness of
domestic auto parts
makers underlined
• Competitive
domestic auto parts
makers forecast to
generate overseas
sales
Figure 2. Japanese Auto Parts Stocks Sharply Rise
on Expansion of Overseas Sales
120
100
80
60
40
20
P/E gap between automakers and auto parts makers (RHS)
Japanese major automakers’ avg P/E (LHS)
Japanese major auto parts makers’ avg. P/E (LHS)
Toyota- GM joint venture in
the U.S., New United Motor
Manufacturing, Inc.
(NUMMI), started
production, 1984
Toyota Motor
Manufacturing, Kentucky,
Inc. started production,
1988
60.0
40.0
20.0
(20.0)
(40.0)
0
(60.0)
1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006
Source: Factset, Mirae Asset Research estimates
Figure 3. Korea Auto Parts Manufacturers More
Competitive than China Peers (Japan=100)
Materials Labor
Inventory
management
Transportation
Facility
expansion
Korea 88.3 77 86.2 83.1 80.7
China 81.8 45.9 75 76.4 68.4
R&D labor R&D facility Other R&D Others Total
Korea 74.6 73.7 75.1 80 84.2
China 52.9 58.5 57.3 64.8 72
Source: KIET, KAP Korea, Mirae Asset Research estimates
0.0

AP Insight
Consumer
Industry Update
China’s Consumer Sector
Anita Hwang
852-2295-2523 / anita.hwang@miraeasset.com
Did the snowstorm freeze Chinese consumers?
The unexpectedly cold weather and snowstorm in China
over the past month has triggered many concerns on
escalating consumer prices and reduced consumption
demand. While we believed the temporary shock from
reduced supply would drive up prices, we were not in the
view that consumption demand would be significantly
affected. The most heavily-hit snowstorm areas were in
the rural and second- to third-tier cities in Central and
Southern provinces. These regions are neither key
revenue-generating areas for retailers nor manufacturing
hubs for apparel and footwear. Unless the snowstorm and
cold weather persist for much longer, we expect material
negative impact to be contained to the agricultural players.
The retail statistics from first-tier cities like Shanghai and
Beijing during the Spring Festival holiday confirmed that
consumption has not dwindled during the cold weather.
Beijing Municipal Bureau of Commerce reported that sales
of 36 department stores in Beijing on the past Sunday
increased 29.6% YoY. According to statistics from the
Beijing Commercial Information and Consultation Center,
sales revenue generated from a sample of 2,901 stores in
Beijing recorded double-digit growth in line with
expectations.
Figure 1. Beijing’s Retail Sales during New Year’s
Category Y-o-Y Growth (%)
Department stores / shopping malls 23.4
Supermarkets 21.0
Catering Services 13.2
Specialty Stores 12.4
Source: Beijing Commercial Information and Consultation Center
According to samples drawn by the Shanghai Economic
Committee during the seven day Spring Festival holiday
from 361 large- to-mid retailers in Shanghai, total retail
sales were RMB4.2bn or an increase of 20.5% YoY. Part
of the increase was attributed to the increased spending
from staying in town during the adverse weather. Overall,
the retail sales of consumer goods in China during the
Spring Festival holiday rose 16.0% YoY to RMB255bn
(15% YoY growth in 2007, 14.5% YoY growth in 2006).
A reality check of hypermarkets in Shanghai
Research on “Large-scale Retailers in Shanghai in 2007”
conducted by Shanghai Business School revealed a
slowdown in expansion of hypermarkets in Shanghai. New
store opening reduced as a result of intense competition
and escalating rental costs.
Figure 2. Slowed Expansion of Hypermarkets in
Shanghai during 2007
2007 2006
New Store Opening 14 20
Closure 1 2
Total 145 132
YoY growth in store number 9.8% 15.2%
The level of competition is reflected in the fact that 69 of
the 145 hypermarkets in Shanghai have at least one
competitor within a 1 km radius. Some stores have as
many as 4 competitors within a 1 km radius. 133 of the
145 hypermarkets have at least one competitor within a 3
km radius. Some stores have as many as 16 competitors
within a 3 km radius.
We reiterate our previous view that China’s hypermarket
competitive environment is highly intense as a result of
rapid expansion. Growth rate is expected to slow
particularly in first-tier cities while profit margin is expected
to narrow. Market consolidation is expected to continue as
small players struggle to survive. We believe the
hypermarket is likely to become an oligopolistic market
dominated by national foreign players and a few regional
leaders.
Feb 15, 2008 MIRAE ASSET RESEARCH 21

AP Insight
Banking
Industry Update
M&A Rumor & Asset Quality Worries
Patrick Pong
852-2295-2516 / patrick.pong@miraeasset.com
Highlighted Companies
Company Rating Current Price (Feb 14) Target Price
CCB (939.HK) Not Rated HK$5.83 -
HK’s Wing Lung Bank is speculated to be for sale
According to Ming Pao Daily, a large-scale Chinese bank
has interests to acquire Wing Lung Bank (WLB), which is
62.56%-owned by the Wu family. WLB, a medium-sized,
locally incorporated commercial bank, with market cap of
HK$22bn, denied there are negotiations or agreements.
Asking price is equivalent to 3x book value
Asking price is reportedly to be as high as 3x book value
(or 21x FY06 earnings), valuing WLB at HK$34bn. This
valuation looks expensive as transactions of mediumsized
banks in HK usually fall within a range of 1.2x-2.5x
book value. The most expensive M&A was back in 2001
when DBS bought Dao Heng Bank for 3.4x book value.
The most recent M&A was in 2006 when JCG Holdings
acquired Asia Commercial Bank for 2.4x book value.
Figure 1. Chinese Banks’ Exposure in HK
BOC(HK) CCB(Asia) ICBC(Asia) WLB
Branches HK 280 20 41 33
Macau 0 4 0 0
Others 12 0 0 3
Profit(2006) HK$mn 14,007 616 1,246 1,606
Asset(2006) HK$mn 928,953 36,894 146,392 84,981
Equity(2006) HK$mn 86,640 8,024 11,085 11,382
Shareholder
BOC
65.7%
CCB
100%
ICBC
71.21%
Wu
family
62.56%
Source: Company
Who’s the buyer?
BOC looks unlikely as BOC(HK) is already one of the
largest players in HK and an acquisition of WLB is unlikely
to bring in much synergetic benefit. Although ICBC is
expanding overseas, emerging markets are at the top of
its agenda. It recently acquired 79.9% of Macau’s Seng
Heng Bank for HK$4.5bn and 20% enlarged capital of
South African Standard Bank for HK$42.31bn. An
acquisition in a mature market like HK looks inconsistent
with the bank’s M&A objective.
Could be CCB given its Asia expansion strategy
CCB’s exposure in HK and overseas markets is relatively
small compared to other Chinese banks. A major
breakthrough was in December 2006 when CCB acquired
Bank of America(Asia) in HK for HK$9.7bn or 1.3x book
value. It has now adopted the name CCB(Asia). This has
only raised overseas earnings contribution to 1.9% in
1H07, in contrast to 0.8% in FY06. CCB’s chairman
indicated that the priority of overseas development
strategy is to strengthen Asian business, particularly in HK.
Recently, the bank spent HK$1.8bn to acquire a 50%
interest in a HK office building which is to be constructed
by 2011. Moreover, the bank’s branch network expanded
from 14 in 2006 to 20 in 2007. These moves suggest
CCB’s expansion plan in HK has continued.
Inappropriate time to acquire because…
While US subprime meltdown does not pose a systemic
threat to the HK banking sector, HKMA deputy chief
executive Choi Yiu-kwan warns that “local lenders should
not lose sight of the second wave” and closely monitor the
contagion effect on HK’s economic growth and asset
quality. An increase in bad debt charges would erode
profitability of HK banks.
Profitability to be trimmed by economic slowdown
Bank asset qualities remain sound so far, as the overdue
loan ratio hovers at a record low of 0.6% and bad debt
charge to asset ratio stands at 0.04% as of 3Q07.
However, when economic activities start moderating over
the course of the year, overdue loans and bad debt
charges should start to rise as they usually lag behind the
business cycle. For instance, when HK’s real GDP slowed
from 6% in 1994 to 2.3% in 1995, banks’ bad debt charge
ratio edged up from 0.05% in 1994 to 0.18% 1996. After
the Asian financial crisis, this ratio peaked at 0.76% in
1999. Despite these concerns, we believe the HK
economy should be more resilient than before, as
discussed in the previous AP weekly. We expect the ratio
to be more in line with 1996 levels. Hence, the impact on
the HK banking sector is likely to be limited as ROE
declines 1.9%p to 14.6% and ROA narrows 0.15%p to
1.2%.
Feb 15, 2008 MIRAE ASSET RESEARCH 22

AP Insight
Figure 2. Impact of HK Economic Slowdown
Banking
Sector
Scenario 1 Scenario 2
2006 A slowdown A recession
Pre-provision
ROA
% 1.54 1.54 1.54
Bad debt charge % of asset 0.01 0.18 0.76
Pre-tax ROA % 1.53 1.36 0.78
Tax % of asset 0.18 0.16 0.09
Post-tax ROA % 1.35 1.20 0.69
Equity/Asset % 8.2 8.2 8.2
ROE % 16.5 14.6 8.4
Source: HKMA, Mirae Asset Research estimates
We prefer CCB on undemanding valuation
We believe CCB’s expansion in Asia through organic
growth and acquisition should continue and be positive to
the bank’s long-term outlook. As a global economic
slowdown would erode profitability, it is in the bank’s favor
to fight for the best valuation, which is more than what the
Wu family is asking, or to look for other opportunities in the
Asian region. CCB is trading at 16.6x FY08 earnings, well
below the peer group average. Coupled with 28% EPS
CAGR, we prefer CCB compared to its China peers.
Figure 3. Peer Group Comparison
(X,%)
P/E
2007
P/E
2008
P/B
2007
P/B
2008
3-yr
EPS
CAGR
China Merchant Bank 42.3 29.3 6.4 5.4 42.7
Bank of Comm. 27.5 21.4 4.3 3.9 34.1
China Construction Bank 20.2 16.6 3.7 3.4 28.3
Bank of China 14.3 11.0 1.9 1.7 25.4
ICBC 22.0 17.0 3.4 3.2 31.7
China CITIC Bank 21.8 15.1 2.6 2.3 45.2
Average 24.7 18.4 3.7 3.3 34.6
Sources: Bloomberg, Mirae Asset Research estimates
Feb 15, 2008 MIRAE ASSET RESEARCH 23

AP Insight
Internet / Software
Company Update
China’s B2B e-Commerce Giant
Woo-Cheol Jeong
82-2-3774-6708 / good@miraeasset.com
Taeyoung Kim
82-2-3774-2132 / tykim@miraeasset.com
Highlighted Companies
Company Rating Current Price (Jan 9) Target Price
Alibaba.com (1688.HK) HOLD HK$ HK$ 19.00
Initiate with HOLD rating and TP of HK$ 19.00
We initiated coverage of Alibaba.com with a HOLD rating
and TP of HK$19.00. We have a neutral stance on the
stock as even though the price has fallen more than 50%
from the previous high due to weak global stock
performance, we still view the current valuation as
demanding.
Alibaba.com was listed on the HKSE on November 6,
2007. The company raised US$1.5bn in its IPO, which
was the largest IT offering since Google. As China’s
largest and leading e-commerce company, Alibaba.com
has first mover advantage in the Chinese B2B ecommerce
market.
The company is currently trading at FY08 forecast P/E of
97.9x. Chinese Internet firms on the NASDAQ are trading
at an average FY08 forecast P/E of 26.7x, while the
benchmark Hang Seng Index average FY08 forecast P/E
is 17.6x. TP was derived by applying Hang Seng Index
average PEG of 0.9x to 3-year EPS growth in anticipation
of the company’s growth potential. As there is limited
upside potential (current stock price is HK$19.58), we
maintain a HOLD on the company.
We forecast the company to post FY08 revenue of
RMB3.4bn (up 54.3% YoY) and OP of RMB760mn (up
75.6% YoY). The company should enjoy such robust
growth thanks to its first mover advantage in the China
B2B e-commerce market. Considering China’s high
economic growth and rapidly improving Internet
infrastructure, high growth of the B2B e-commerce market
should sustain.
Of note, the utilization rate of e-commerce by China
SME’s is rising fast. Moreover, the proportion of paid
members among the company’s member base is still very
small, thus leaving ample room for growth.
Figure 1. Paid subscribers
(1,000) Gold Supplier (Lhs)
(1,000)
25
International TrustPass (Lhs)
250
20
China TrustPass (Rhs)
200
Feb 15, 2008 MIRAE ASSET RESEARCH 24
15
10
5
0
05/12 06/06 06/12 07/06
Source: Mirae Asset Research estimates
Figure 2. Revenue and OP
(RMB mn)
6,000
5,000
4,000
3,000
2,000
1,000
0
Revenue (Lhs) OP (Rhs)
2004 2005 2006 2007E 2008E 2009E
Source: Mirae Asset Research estimates
0
150
100
50
0
(RMB mn)
1,400
1,200
1,000
800
600
400
200

AP Insight
Tech
Industry Update
Semiconductor Update
Hak Moo Lee
82-2-3774-1785 / hmlee@miraeasset.com
We believe that the DRAM cycle has bottomed out.
However, there are still several uncertainties, given 1) that
Qimonda has issued convertible bonds; 2) that Micron
Technology should shortly spin-off its CMOS image
sensor business and focus on its memory business; 3)
that Powerchip Semiconductor Corp (PSC) should expand
sub-32-nm CMOS research.
Qimonda is projecting revenue to drop -56% YoY to
€513mn and NP to turn in the red to €598mn in 4QFY07.
The operating cash outflow was around US$400mn in the
same quarter, and it had been performing the worst
among DRAM companies (Figure 1).
Figure 1. Operating Cash Flow in 4QFY07
(US$ mn)
400
300
200
100
0
(100)
(200)
(300)
(400)
(500)
Micron
Hynix
Source: Micron Technology
Elpida
Even though DRAM prices have rebounded recently by
around 15-20% from the previous bottom, major
commodity DRAMs such as DDR2 512Mb are still far
below cash cost. Therefore, Qimonda could continue to
suffer from operating cash outflow.
Recently, Qimonda issued convertible bonds (total amount
US$217.6mn, 17.5mn ADSs with an initial conversion
price of US$7.25 per share at a coupon of 6.75%). We
believe that it would take more time to reach the
meaningful reflection point of the DRAM industry, due to
Qimonda’s efforts to survive. In spite of the operating cash
outflow, the company still focuses on the DRAM
technology progress to 58nm and the cost optimization of
ProMOS
Powerchip
Nanya
Qimonda
1Gb DDR2 on 75nm.
Micron Technology also seems to focus on being a
dedicated memory manufacturer by spinning off it CMOS
image sensor (CIS) units. We see that this could bring
about more competition among the top memory players.
Micron has been well positioned to benefit from 8” fab
leverage on CIS like the system LSI business of Samsung
Electronics. Unlike other dedicated DRAM players, Micron
and Samsung Electronics have been less vulnerable to
the price drops due to their 8” fab utilization on various
products other than DRAMs.
Even though Micron has a plan to expand the NAND flash
market by sub-40 nm products in 2H08, it would suffer
from its supply of DRAM units due to the relatively
stagnant progress in technology migration to sub-70 nm.
More than 80% of DRAM in Micron’s 12” fab in Virginia
and Singapore is being produced in 78nm technology,
which has less size efficiency than Samsung’s 68nm and
Hynix’s 66nm technology.
We believe that the restructuring of the DRAM industry is
imminent, but the speed would be slower than anticipated.
Powerchip Semiconductor, a Taiwan DRAM company, is
poised to join the sub-32 mn memory technology group
from next month. Powerchip Semiconductor is also
struggling with operating cash outflow. However, it should
progress one step forward to strive to survive in DRAM
industry.
Feb 15, 2008 MIRAE ASSET RESEARCH 25

AP Insight
Tech
Industry Update
Taiwan Semiconductor Manufactu
ring (TSMC)
(2330.TT, Not Rated)
United Microelectronics (UMC)
(2303.TT, Not Rated)
H C Kwan.CFA
852-2295-2525 / kwanhc@miraeasset.com
A bump cleared, but more ahead
Both TSMC and UMC during the week reported net sales
figures for the month of January as sales were flat on a
MoM basis. TSMC reported small growth of 3.6% MoM to
NT$31.0bn while UMC reported a small MoM decline of
2.9% to NT$8.2bn.
The performances of both foundries in January are in line
with earlier guidance. But we see more turbulence ahead
for them, especially in 1H08.
UMC is expected to face sharp slowdown in sales over the
next two months. We estimate a 20% drop in sales in the
last two months of 1Q08 due to shrinking shipment volume
and ASP. Given over 30% depreciation costs in COGS,
profit, in there is any, is likely to drop significantly.
TSMC may do better for its higher share of sales from
advanced under-90nm process nodes, which may edge up
2%p to 35%. But a fall in utilization rate to 70% from 85%
in 4Q07 should hurt bottom line.
We believe 1H08 should be a tough period for
semiconductor players and look forward to a turnaround in
3Q08, driven by ever increasing popularity of flat panel
TVs. The US is scheduled to terminate analog
broadcasting in February 2009. Barring a severe downturn
in economic activities, demand for new replacement TV
should be solid in the US and around the world.
Figure1.Total Semiconductor Capital Spending (US$bn)
2007 2008 2009 2010 2011 2012
59.09 51.30 55.72 63.25 58.25 62.65
Source: Gartner
As shipment slows, top foundries are cutting capex in
equipment investment and turning to R&D to boost
productivity. Unlike their peers, these companies have
been cutting capex more aggressively. According to
Gartner’s newly release estimates, global semiconductor
capital expenditures is forecasted to shrink 13.2% to
US$51.3bn. In the meantime, the two foundries plan to cut
even more than that: each by over 30% in 2008.
Feb 15, 2008 MIRAE ASSET RESEARCH 26

AP Insight
Telecom
Earnings Review
Industry Update
IPTV Begins to Bloom in Asia
Young Choi
82-2-3774-2173 / young.choi@miraeasset.com
Our View on Highlighted Companies
Company Rating
Current
Price(Feb13)
Target Price
KT(030200.KS) BUY W50,000 W 71,000
SKT(017670.KS) BUY W189,000 W 330,000
Hanaro Telecom(033630.KS) BUY W11,600 W13,100
China Telecom(728.HK) Not Rated HK$5.74 N/A
China Netcom(906.HK) Not Rated HK$23.10 N/A
PCCW(8.HK) Not Rated HK$4.43 N/A
IPTV business is on a rising trend in the Asian
telecommunications industry. As most fixed-line telecom
operators face declining revenue from fixed-line
operations, IPTV is emerging as a positive new growth
driver. Also, recent trends toward telecom-media
convergence should be another factor driving IPTV
business growth. China started IPTV services in 2005 and
Korea is expected to launch full-IPTV services with realtime
broadcasting in early 2H08. Meanwhile, Hong Kong
has already seen meaningful penetration in IPTV services.
Figure 1. IPTV Subscriber Numbers in Asian Market
('000)
1,200
2006 2007
1,000
800
846
758
900
600
500
400
200
0
China Hong Kong
(PCCW)
150
1,131
Korea
Source: Korea Electriocs Information Center, PCCW, Mirae Asset
Research estimates
Note: Hong Kong’s 2007 number is estimation
Note: KT’s subscriber number is not considered in Korea’s 2006 number
China’s IPTV subscriptions were 846,000 persons at end-
2007, significantly below market expectation of 1.3mn. We
believe regulations on IPTV led to the sluggish growth.
The Chinese government issued IPTV business licenses
to only four broadcasting companies (Shanghai Media
Group(SMG), CCTV, Southern Media Corp(SMC), and
Zhejiang Radio Television Group(ZRTG)), and has not
allowed telcos to operate the business directly. Separation
of services from the network deterred aggressive
infrastructure investments by telcos. However, we remain
focused on the following positive drivers for IPTV services:
1) CT, CNC and SMG willingness to support IPTV
business; and 2) government plans to reduce the gap in
information accessibility between urban and rural regions.
In short, IPTV business has great potential to grow in the
China market.
Hong Kong now looks to be the world leader in IPTV
penetration with the success of PCCW’s ‘nowTV’ service.
Launched in 2003, nowTV is expected to have had around
900,000 subscribers at end-2007. Aside from the fact that
IPTV subscriptions and ARPU showed steady growth, we
are focused on PCCW’s QPS plan to utilize content
distribution across various platforms (mobile, fixed-line,
broadband, IPTV). We believe PCCW should benefit from
the QPS plan as it should lower churn rate of other
products and increase overall ARPU. We also believe
PCCW’s nowTV is a stronger service than i-Cable’s
(dominant cable TV operator), considering superiority of
content and availability of bundled service.
Figure 2. PCCW’s nowTV Subsciptions and ARPU
Trend
Feb 15, 2008 MIRAE ASSET RESEARCH 27
('000)
1,000
800
600
400
200
0
Subs (LHS)
monthly ARPU (RHS)
2H03 1H04 2H04 1H05 2H05 1H06 2H06 1H07
Source: PCCW, Mirae Asset Research estimates
(HK$)
200
In Korea, we believe IPTV is about to bloom. Total number
of subscribers of pre-IPTV (based on VOD service)
reached 1.1mn as of December 2007. With the National
Assembly granting full-IPTV services at the end of last
year, launch of full-IPTV services should begin early 2H08
by major fixed-line telcos, like KT and Hanaro Telecom.
Also, as dominate mobile operator SKT’s acquisition of
Hanaro Telecom is expected to be approved by the
government, the IPTV market should be driven by two
dominate players: KT and SKT. This should lead to largescale
penetration of IPTV business, in our view.
160
120
80
40
0

AP Insight
Figure 3. Trend in Korea IPTV Subscriptions
('000)
1,200
1,000
800
600
400
200
0
Hanaro (HanaTV) KT (MegaTV)
55 65 73
147
230
548 501 540 591 664
280
754
325
807
Jun07 Aug07 Oct07 Dec07
Source: Company data, Mirae Asset Research estimates
Feb 15, 2008 MIRAE ASSET RESEARCH 28

AP Insight
Recommendation
By item (six months)
Buy: A target price of over + 20% of the current price,
Hold: A target price of - 10% to +10% of the current price
Reduce: A target price of –20% or less than the current price
* Note: Correction of –10% to +10% is possible based on the
investment recommendations by industry.
Earnings Quality Score
By industry
Attractive: over +10% of the current industry index
Neutral: -10% to +10% of the current industry index
Cautious: -10% or less than the current industry index
Terminology of Investment recommendation by industry has changed
since August 3, 2005 as follows: Overweight Attractive /
Underweight Cautious.
Earnings Quality Score = 0.70*(Historical Earnings Stability) + 0.15*(Consensus Forecast Certainty) + 0.15*(Consensus Forecast
Accuracy)
1. Historical Earnings Stability
- The variability of the net profit growth rate (YOY) over the last 20 quarters was translated into percentage terms.
- Earnings growth variability was calculated based on MAD (Median Absolute Deviation), rather than SD (Standard Deviation) in order to
minimize distortion from outliers.
- The lower the earnings growth variability, the higher this indicator.
2. Consensus Forecast Certainty
- The gap between analysts' views on 12-month forward EPS was translated into percentage terms.
- The gap is calculated by dividing the SD of 12-month forward EPS with the average value.
- The narrower the gap is, the higher this indicator.
3. Consensus Forecast Accuracy
- The median value of absolute EPS surprise over the last 3-year was translated into percentage terms.
- EPS surprise was calculated based on 'the actual figure at the end of the year / the consensus estimate at the beginning of the year - 1'.
- The lower the absolute EPS surprise, the higher this indicator.
* Reference
1) Consensus Forecast Certainty and Consensus Forecast Accuracy were applied only to companies with more than 5 years of EPS
estimates.
2) We gave the average score of 50 to cases in which the aforementioned indicators could not be produced.
Compliance Notice
This report is distributed to our clients only, and none of the report material may be copied or distributed to any other party. While we have taken
all reasonable care to ensure its reliability, we do not guarantee that it is accurate or complete. Therefore, Mirae Asset shall not be liable for any
result from the use of this report. As of Jan 18, Mirae Asset is entrusted to deal with the disposition and acquisition of treasury stock for SK
Telecom.
As of Feb 15, Mirae Asset Securities is SKT, KT's ELW issuer and LP.
For China Merchants Bank (3968.HK), Bank of Communications (3328.HK), China Construction Bank (0939.HK), Bank of China (3988.HK),
ICBC (1398.HK), China CITIC Bank (0998.HK), Guangzhou R&F Properties (2777.HK), and Li Ning (2331.HK):
Mirae Asset HK (MAHK) has financial interest in China Merchant Bank as at January 31, 2008, but no financial interests in other companies as at
January 31, 2008. MAHK does not act as a market maker of the companies on January 31, 2008. No employees of MAHK serve as an officer of
the companies as at January 31, 2008. MAHK acts no investment banking roles for the companies within past 12 months.
This report has never been provided to any institutional investor or third party. This report has been prepared without any undue external
influence or interference, and accurately reflects the personal views of the analyst on the company herein.
[Mirae Asset Securities Research]
Item Analyst Type
Securities Held by the Analyst
Number of
Shares
Purchasing
Price
Purchasing
Date
Holdings of
Shares over1%
Participation in
the Issuance of
Securities
Involvement
with the
Affiliates
Treasury Stock
Acquired
Feb 15, 2008 MIRAE ASSET RESEARCH 29
NA