FIGs Commercial Banks
Equity – India
Meeting Notes: When managers turn cautious
Most bankers we spoke to are cautious on the fiscal deficit meeting targets and consequently on rates easing Similarly, we see bankers’ increasing discomfort with predicting an improvement in delinquencies and NPLs Infra and retail loan growth prospects remain better than corporate loans
We met with the management of several banks this week seeking to understand postbudget views and FY13 outlook.
24 March 2012
Sachin Sheth * Analyst HSBC Securities & Capital Markets (India) Private Limited +91 22 2268 1224 firstname.lastname@example.org Tejas Mehta * Analyst HSBC Securities & Capital Markets (India) Private Limited +9122 2268 1243 email@example.com Todd Dunivant * Head of Banks Research, Asia Pacific The Hongkong and Shanghai Banking Corporation Limited +852 2996 6599 firstname.lastname@example.org View HSBC Global Research at: http://www.research.hsbc.com *Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is not registered/qualified pursuant to FINRA regulations Issuer of report: HSBC Securities and Capital Markets (India) Private Limited
Macro: Fiscal deficit targets are ambitious particularly on oil subsidies; dampening sentiment for both equity and debt investors; liquidity not a big issue, RBI will manage the situation; FY13 is a year of regulations for NBFCs. Growth: Infra growth likely at 20-25%, mainly from the telecom sector; stability of home loan rates since November 2011 has supported mortgage growth; overall system loan growth expected at 15% in FY13 Rates and margins: 75-100bp rate cut expected in a gradual manner; however, how much will be passed on by the banks remains a question mark; lead may be taken by PSU banks, possibly at the behest of the Government or if RBI cuts CRR further and infuses liquidity via OMOs. Asset quality: While chunky restructurings (e.g.GTL) appear to be coming to an end by the June quarter, except SEBs, SMEs and mid-corps remain under stress (e.g. steel, export-linked) where signs of deterioration are apparent; slippages appear to be plateauing, but this has taken a toll on loan growth given risk aversion; restructuring of smaller accounts likely to continue until rates come off meaningfully. Stock catalysts: Positive catalysts: meaningful increases in SEB tariffs, steps taken to resolve coal supply and related issues; negative catalysts would include many of the issues mentioned above and in the near term, the Government’s borrowing program likely to be announced next week, which could be skewed to the first half. Stock strategy: Our preferred picks would be those stocks that: i) remain cheap relative to their history and relative to peers, ii) have a loan book size or mix that is resilient to slow system growth, iii) have relatively fewer asset quality issues. Hence, our preferred picks include ICICI Bank and the housing finance companies (LICHF, HDFC Ltd). We also like YES and IndusInd (both OW) given their relatively cheaper PE multiples as earnings potential and visibility are higher.
Disclaimer & Disclosures This report must be read with the disclosures and the analyst certifications in the Disclosure appendix, and with the Disclaimer, which forms part of it
expected to be flattish. When competitors will cut. HSBC
If liquidity improves with sustained comfort that regulator will infuse liquidity by OMO. services sectors are the key credit substitutes. growth is expected to be more than 20%. they will dictate Expects deposit rate to come down in the next couple of quarters with the cut in only short term rates the non-retail term deposit being the trigger point Expects RBI to cut rates by 75 -100bp.6% centres (fairly new focus be 15% if GDP growth slips to area) are expected to drive at 15-20% and 15% respectively. Current liquidity deficit scenario is also because of people’s preference for physical assets (especially gold)
April-May is expected to be better on the liquidity front and rates will come Deposit growth will help to meet the lending requirements to a major extent. portfolio is expected to be 27-28% of the optimistic. but has softened
Source: Company data. will be corporate side met. book. Overall loan growth at of around 7% and grow at about 20-21%. YES has done loans via By then it is expected to be loan book in the next 3-4 years. Retail GDP growth is 6. then everyone will follow. then there is no need to wait for policy rate to come down to cut lending rates.8% on account of: i) maturing result from CRR cut.linked by June. Infrastructure . ii) portfolio mix more towards the Recent increase in the deposit April and total of 50bp domestic loans. Expects the NIM margins to improve by Lending rates cut could 15bp to 2. With 40 -50% of the retail loan International book loan growth is growth segments credit substitutes. but that will happen gradually. iii) re pricing of the rate is to ensure customers are corporate loan (reprised annually . however not sure whether subsidy target. range of 18-19% if the GDP growth is 7. securitisation book(5-6 bps on account of Rate cuts may not be cuts are expected very soon.
Margins/Rate Interest rates will start outlook coming down from April and can decrease by 1% over FY13 in a gradual manner. Banks will then take 2-3 months to decide about rate cuts. Believes 7.5% in FY13 and will Geographically .manufacturing and growth in the next 3-4 years. action will not dictate medium term investments. Loan book growth will be in the Loan Book is expected to Estimates an overall system loan growth Expects a GDP growth of 15% for FY13.5%. retained in light of the competition to the base rate). Budget is conservative. oil If the economic growth is not subsidies needs to be revived and the government watched borrowing does not decrease then there will be a drag on liquidity. a gradual manner but small rate of which 25bp is likely in April. Deposit rates: Will come down gradually. down Liquidity problem in the system in the last few months have resulted in economic rates going far higher than the policy rates. will depend upon repo rate cut Spread difference between SME book vs Large corporate book has not changed much.
. YES Bank
Sentiments and policies This year's budget is more determine investment realistic. Expects the policy rates to fall in Expects a 75bp cut in FY13.Non urban ICICI expected to be 20% with the retail system credit growth of and corporate segment expected to grow 15-16%. more than 25 bps in it). especially demand rather than interest rates especially on the large the oil subsidies target.India Financials Commercial Banks 24 March 2012
Summary of management discussions
Management feedback COMPANIES Axis Macro Views Liquidity to improve with government spending in March BOB HDFC Bank ICICI Domestic economic activity is likely to pick up. iv) increase in yield on Govt. rates.
4% range. and concentrated more The benefit of the cut in the towards midsize market. Consumer: CIBIL has come in. YES has 80-85% cover on NPA. Currently it is doing it only for auto segment. To some extent it is negated by the expected higher credit cost. YES Bank Provisioning run rate has been 30-35bp net of Recovery. SME book have grown smaller in last 18 months.2-1.
economic growth and high Retail: Looks at delinquency interest rates continues then ratio as main ratio. cycle of sub optimal LCV segment may see some stress in the next 3-4 quarters as it is a relatively new segment for the bank. Focus is on secured loan category. given that rates being capped at 12%. therefore will fall short of PSL SME: had some share of slippages this year as well but in last 6-9 months slippages seems to be plateauing. Focus now is more on better Stickiness in the deposit quality SMEs. Saving deposits are 4% of total deposits. Looking increasingly at internal customers. Asset Quality rates is expected and capex cycle are main triggers to look at. Credit loss ratio No significant jump in NPA will be under 70bp but restructuring could Gross NPL to remain in the increase 1. This qtr Bank could see CASA mix around 14. Concerned that if the current asset quality remains stable and is expected to be robust. there is not a dramatic shift in overall earning component Sectors: BOB HDFC Bank ICICI Believes the worse is over.The retail book slippages is very low (near 0).5-15%
Does not expect any large Seeing good recoveries in corporate account to be the current quarter restructured. Spreads are less and rewards are not commensurate with risk
Going forward incremental Since 2 HY10 it has decided lending to the SMEs will be to derisk loan book (bulk) with caution. Started diversifying & selling policy rates will likely be passed on to the borrowers. down loans (Long term loans. current rate with respect to NPL in the delinquency.
Domestic macro economic Barring some temporary stress in the CV loans and situation has resulted in loans in the Bellary-Goa belt. Supply chain financing is an opportunity. Their main focus is higher loan amounts. Internal Metrics like internal It expects to meet its upgrade vs downgrade. which is there could be further stress very low right now. Provisioning is tight as it provides 100% for NPA 180 days past due Agri: Asset Quality has not worsened but has taken toll on growth.India Financials Commercial Banks 24 March 2012
Management feedback COMPANIES Asset quality Axis Credit cost: Currently at 85bp. shorter disbursement time. have next 18-24 months which is worsened in last 9-12 likely to improve the asset months as compared to a quality further year back
It has strategically started to focus on the rural segments which provide advantages like i) higher CASA ratio (upwards of 60%) ii) higher yields. It intends to finance both dealers and vendors in auto supply chain
Source: Company data. stress in asset quality. SMEs typically don't bargain for a difference of 25bp in rates. Road and infra segment lending are not attractive. Even if goes up by 100bp. retaining only 10-15% of them). 7 internally decided sub targets day matrix. Expects some stress in the SME sector .
. 90 day NPA rule etc Confident that RBI will use the available tools to manage liquidity and does not see it as a big issue There is more hawkishness recently because of fiscal situation
Expects a growth in the range of 20 -25%. achieve it Expects FY13 to be the year of regulations for RBI would like to see inflation coming off in a stable NBFCs with proposals like Tier 1 requirement of way 12%.1% is ambitious and a Though manufacturing has slowed to some extent would be a big challenge for the government to in the current year. Growth Outlook is bullish for the next year. financing will grow on account of i) change in buying pattern with lesser percentage of cash purchases ii) increase in the prices of the products that are financed (7-8% price increase expected) will lead to topline growth Loan book growth is expected to grow by 25-30% in FY13 Markets are confused as they have been expecting Believes that the interest rate has peaked and is Believes interest rates have peaked. Dynamics have changed a little with the current Measures in the budget for infra spending is It is not looking at entering the 2 wheeler financing and the Microfinance segment given the inherent situation being that banks are equally willing to lend positive for investor sentiment nature of small sizes of EMI in these segments. The Mumbai property market has slowed down but it will not collapse as there is limited supply. A 3% plus post tax ROA is requisite for entering Seeing positive signs with SEBs revising tariffs Does not fund road projects in unknown territory into any new segment.
Source: Company data. asset quality is likely to remain at current levels (in terms of gross NPL ratio) Decreasing trend of LTVs is a comforting factor. Even if the will mainly come from the telecom sector overall growth in the volumes of the assets that are financed is flat. Stability in the housing loan rate since November has resulted in the uptake of the home loan credit. IDFC MMFS
The Fiscal deficit target of 5. NPL ratio could increase by 100 bps if monsoon fails and by 150 bps if the 90 day NPA recognition rule comes in. financing has not. to the housing finances companies(to meet priority Power sector issues like coal supply will be sector target) eventually be sorted out in due course of time. lending rates to the non individual segment will not come Expects a total of 100bp rate cut to happen in a down given the riskier nature of the borrowers and very gradual manner over the next year the aversion of the banking sector to lend to them With an asset book not very farm dependent.India Financials Commercial Banks 24 March 2012
Management feedback COMPANIES Macro Views HDFC Ltd High levels of fiscal deficit is dampening the foreign investor sentiment who invest not only in the equity market but also in the debt market (with the limits opening up) Stability in the rates has as much effect on the borrower as the actual interest rates. However even if the policy rates are cut. Current liquidity is a March phenomenon and the situation should improve as the government money gets unlocked (by means of distribution of the budgetary allocations) Expects a loan book growth of over 20%. likely to come down from here. rate cuts since Dec but it has not materialized.
Source: Company data.9 1. As economic growth peaks.6 4.0 6% 14% 1. below.1 1.247 2.BO Union Bank PSU Universe Private Sector banks AXBK.2 1. the Neutral band is 5 percentage points above and below the hurdle rate for Indian stocks of 11%. or within the Neutral band of our model at the time we set our target.3 2.7 3.2 1.9 7.9 1.0 13.3% 32.4 2.7 14.1 5.2 2.7 10. UW(V).0 1.9% 23.4 8.086
8% 20% 8% 1.8 1.9 4.BO HDFC LICHF.792 3.8 8. UW.BO Canara Bank PNBK.1 18.406 1.9 13.5 1.979 2.0% 23. PB and EPM on macro factors influencing the sector.2 4.4 0.0 1. EPM is based on the assumptions in the following table:
EPM assumptions BOB Semi-explicit forecasts for 10 yrs Loan CAGR Dividend payout Fade period of 12 yrs Risk free rate Beta Equity risk premium Cost of Equity EPM value
8% 18% 8% 1.3% 19.0 2.9 3.BO Bank of Baroda BOI.9 4. Our target prices provided upside potential that was above.0 6% 14% 274
13% 23% 8% 1.BO LIC Housing Finance LTFH.BO Bank of India CNBK.6 2.5 12.161 216 889 358 544 1. PE holds sway above PB in valuing banking stocks during a recovering credit cycle.BO SBI UNBK.0 0. the Neutral band is 10 percentage points above and below the hurdle rate for Indian stocks of 11% and for stocks without a volatility indicator.7 1.0 6% 14% 965
8% 18% 8% 1.2 19.6% 15.2 13.7 6% 12% 443
14% 30% 8% 1.234 326 372
OW OW OW OW OW
659 260 48
808 299 51
OW OW (V) N (V)
Note: Under our research model.0 6% 14% 48
.BO L&T Finance Holding NBFC Universe Total Coverage Universe 786 355 461 945 2.625 9.7 2.6 11.8 2.6 10.592 22.831 2.5 10.6 2.6 0.525 58.177 504 900 310 367
1.India Financials Commercial Banks 24 March 2012
India Banks Coverage Universe (closing price as on 22 March 2012) RIC Code Stock Market Price INR Public Sector banks BOB.5 7.8% 11.6% 18.0 10.0 6% 14% 255
15% 15% 8% 1.484 23. followed by 10 years of semi-explicit forecasts.7% Target Price INR Rating Market cap _________ HSBC P/E__________ (USDm) Fy12e Fy13e Fy14e ________ HSBC P/B __________ EPS CAGR Fy12e Fy13e Fy14e Fy11-14e
1.1 1.4% 23.0 6% 14% 704
8% 20% 8% 1.BO HDFC Bank ICBK.1 1.984 5.8 1.2 5.0 8.8 0.0 1.847 26. Historically.BO Yes Bank Pvt Universe NBFC HDFC.786
8% 10% 8% 1.037
20% 25% 8% 0.477 569 1.BO IndusInd Bank YESB.2 18.0 1.7 1.6 16. Bloomberg.1 1.8 0.7 1.006 3.3% 5.039 2. for stocks with a volatility indicator.6% 22. therefore.4 5.5 6.5 3.3 3.209 48.0 6% 14% 449
8% 15% 8% 1.3 10.9 1.2 4. the focus is likely to shift from earnings growth potential towards asset quality and the risk to book.BO Axis Bank HDBK.977 129.9 1.5 16.7 4.0 6% 14% 534
8% 18% 8% 1.9 0.5 13.2 1. The final stage of 12 years (fade period) assumes convergence of ROE and COE.0 6% 14% 663
10% 20% 8% 1.3 9. as indicated in the “Rating” column above.3% 2.4 6.2 17.778 6.7 16.9 22.0 6% 14% 1. HSBC estimates
Valuations and risks
We base our weights for PE.3 1.9 3.4 15.0 6.6% 19.5 1.4 2.6 19. OW.2 23.5 9.4 1.0 6% 14% 186
13% 13% 8% 1.9 17.6% 26.2 8.4 13.1 8.BO ICICI Bank INBK.0 6% 14% 1.089 20.0 6% 14% 335
14% 45% 8% 1.4 7.5 4.3 2.2% 18.8 0.3 5. we rate the stock OW(V).9 2.1 21.8 10.5 12.000 236 N UW OW N UW OW 6.6 4.5% 18.7 7.0 11.787 2.3% 11.BO Punjab National SBI.0 1.6 9.176 18.9 1. The three-stage EPM uses explicit forecasts until FY14e.7 0.8 5.7% 21.6 14. N(V) or N.
India Financials Commercial Banks 24 March 2012
Coverage stocks: Valuation and risk factors PE PE-based PB PB-based DCF Weighted TP Upside risks multiple TP (INR) multiple TP (INR) value(INR) (INR)
Public sector banks
Weights BOB BOI CNBK PNBK SBI UNBK Private sector banks Weights AXSB HDBK ICBK
50% 1.4 0.234 ---
15.043 2.8 1.0 1.3 5. negative margins surprise.742 647 1. margin pressure -Weak asset quality trends. Sustained operating profit growth 544 --1.5
51 Sharp decline in rates.009 2.1 3.786 274
889 Less than expected asset quality issues 358 Upside surprise in asset quality.580
Margins surprising downwards again. Higher than expected asset quality stress.061 218
30% 965 449 534 1. management change
2. Higher than expected loan slippages and credit costs Longer than expected build up of retail liabilities.9
50% 827 326 575 1. Asset quality risks Further margin compression and higher provision
LICHF Weights LTFH
10.5 909 4.165
30% 1. Asset quality risks
50% 23. potential Rates remaining high and asset quality banking licence and asset quality risks risks increasing not materialising
.5 9.000 Upturn in the economic cycle and asset quality improves 236 ---
Management change in Nov-12 --Higher slippages.0 0.0 1.086 1.477 564 1.0
255 50% 48
11. spike in NPLs and credit costs Macro headwinds. asset quality risks Slower loan growth.0
20% 929 303 483 1.039 Turnaround in macro environment 2.0
YES NBFC Weights HDFC
10.477 --569 --1.0 20.5
30% 663 808 --A sharp increase in competitive pressures could slow business growth or impact margins. worsening asset quality Slower than expected loan growth momentum.037 443 704
1. management change in 2HFY13.0 5.4 1.
hsbcnet. In addition. Details of these short-term investment opportunities can be found under the Reports section of this website. ratings should not be used or relied on in isolation as investment advice. technical or event-driven techniques on a 0-3 month time horizon and which may differ from our long-term investment rating. Our ratings are re-calibrated against these bands at the time of any 'material change' (initiation of coverage. and although ratings are subject to ongoing management review. Different securities firms use a variety of ratings terms as well as different rating systems to describe their recommendations. regional market established by our strategy team. expected returns will be permitted to move outside the bands as a result of normal share price fluctuations without necessarily triggering a rating change. Given these differences. The performance horizon is 12 months. quantitative.India Financials Commercial Banks 24 March 2012
The following analyst(s). For a stock to be classified as Underweight. the potential return. and 2) from time to time to identify short-term investment opportunities that are derived from fundamental.
Rating definitions for long-term investment opportunities
HSBC assigns ratings to its stocks in this sector on the following basis: For each stock we set a required rate of return calculated from the cost of equity for that stock’s domestic or. including the forecast dividend yield when indicated. is or will be directly or indirectly related to the specific recommendation(s) or views contained in this research report: Sachin Sheth. the stock must be expected to underperform its required return by at least 5 percentage points over the next 12 months (or 10 percentage points for a stock classified as Volatile*). For a stock to be classified as Overweight. Notwithstanding this. economist(s). and/or strategist(s) who is(are) primarily responsible for this report. In any case. must exceed the required return by at least 5 percentage points over the next 12 months (or 10 percentage points for a stock classified as Volatile*). Tejas Mehta and Todd Dunivant
Stock ratings and basis for financial analysis
HSBC believes that investors utilise various disciplines and investment horizons when making investment decisions. As and when HSBC publishes a short-term trading idea the stocks to which these relate are identified on the website at www. The price target for a stock represents the value the analyst expects the stock to reach over our performance horizon. which equals the percentage difference between the current share price and the target price. HSBC believes an investor's decision to buy or sell a stock should depend on individual circumstances such as the investor's existing holdings and other considerations.com/research. because research reports contain more complete information concerning the analysts' views. HSBC has two principal aims in its equity research: 1) to identify long-term investment opportunities based on particular themes or ideas that may affect the future earnings or cash flows of companies on a 12 month time horizon. which depend largely on individual circumstances such as the investor's existing holdings. investors should carefully read the entire research report and should not infer its contents from the rating. HSBC has assigned ratings for its long-term investment opportunities as described below. certifies(y) that the opinion(s) on the subject security(ies) or issuer(s) and/or any other views or forecasts expressed herein accurately reflect their personal view(s) and that no part of their compensation was.
. change of volatility status or change in price target). Stocks between these bands are classified as Neutral. Investors should carefully read the definitions of the ratings used in each research report. risk tolerance and other considerations. This report addresses only the long-term investment opportunities of the companies referred to in the report. as appropriate.
7 1.11 1.55 259.NS CNBK.India Financials Commercial Banks 24 March 2012
*A stock will be classified as volatile if its historical volatility has exceeded 40%.5. As of 29 February 2012 HSBC beneficially owned 1% or more of a class of common equity securities of this company.5.9.2.com/research.2.80 366.6.5.NS BOI.25 2160.11 4. stocks which we do not consider volatile may in fact also behave in such a way. this company was a client of HSBC or had during the preceding 12 month period been a client of and/or paid compensation to HSBC in respect of non-investment banking-securities related services.5.
HSBC & Analyst disclosures
Disclosure checklist Company AXIS BANK LTD BANK OF BARODA BANK OF INDIA CANARA BANK HDFC HDFC BANK ICICI BANK INDUSIND BANK L&T FINANCE HOLDING LIC HOUSING FINANCE LTD PUNJAB NATIONAL BANK STATE BANK OF INDIA UNION BANK OF INDIA YES BANK
Ticker AXBK.50 7184.108.40.206.5. A covering analyst/s or a member of his/her household is an officer. is a Market Maker in securities issued by this company.75
Price Date 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012 22-Mar-2012
Disclosure 1. this company was a client of HSBC or had during the preceding 12 month period been a client of and/or paid compensation to HSBC in respect of investment banking services.BO YESB.7.30 47. In order to avoid misleadingly frequent changes in rating.NS INBK.70 355.BO ICBK.65 310. Historical volatility is defined as the past month's average of the daily 365-day moving average volatilities. as detailed below.is available from www. if the stock has been listed for less than 12 months (unless it is in an industry or sector where volatility is low) or if the analyst expects significant volatility.60 945. the distribution of all ratings published is as follows: Overweight (Buy) 49% (26% of these provided with Investment Banking Services) Neutral (Hold) Underweight (Sell) 36% 15% (23% of these provided with Investment Banking Services) (16% of these provided with Investment Banking Services)
Information regarding company share price performance and history of HSBC ratings and price targets in respect of its longterm investment opportunities for the companies the subject of this report.11 1. as detailed below. However.6.7.4. A covering analyst/s has received compensation from this company in the past 12 months.7 1.35 460.BO PNBK.2.7 6.
Rating distribution for long-term investment opportunities
As of 23 March 2012.7. director or supervisory board member of this company.6.6.7 2.NS UNBK. As of 31 January 2012.7. As of 31 January 2012.5 4.BO BOB.60 659. At the time of publication of this report.NS LICH. volatility has to move 220.127.116.11.BO HDFC.7.11 2.hsbcnet. HSBC is a non-US Market Maker in securities issued by this company and/or in securities in respect of this company
1 2 3 4 5 6 7 8 9 10 11
HSBC* has managed or co-managed a public offering of securities for this company within the past 12 months.7.11 6.25 899. HSBC Securities (USA) Inc.BO SBI.7. HSBC expects to receive or intends to seek compensation for investment banking services from this company in the next 3 months.11 1.BO LTFH.7 1. this company was a client of HSBC or had during the preceding 12 month period been a client of and/or paid compensation to HSBC in respect of non-securities services. At the time of publication of this report.60 215.5 percentage points past the 40% benchmark in either direction for a stock's status to change.2.20 504.6.11 2.4. A covering analyst/s or a member of his/her household has a financial interest in the securities of this company.NS HDBK.6. As of 31 January 2012. however.BO
Recent price 1176.
portfolios and investment clubs in securities managed by such entities) either. HSBC and/or its affiliates (including the funds. directly or indirectly. please see the most recently published report on that company available at www. own or are involved in the acquisition. 1% or more of the total capital of the subject companies securities in the market for the following Company(ies) :AXIS BANK LTD.LIC HOUSING FINANCE LTD. Analysts.CANARA BANK.hsbcnet.com/research.India Financials Commercial Banks 24 March 2012
Sachin Sheth has a long position in the shares of ICICI Bank.STATE BANK OF INDIA.ICICI BANK. economists. For disclosures in respect of any company mentioned in this report. All market data included in this report are dated as at close 22 March 2012. As of 29 February 2012.YES BANK
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* Legal entities as at 04 March 2011 Issuer of report ‘UAE’ HSBC Bank Middle East Limited. The value of any investment or income may go down as well as up and you may not get back the full amount invested. These respective entities make no representations that the products or services mentioned in this document are available to persons in Australia or are necessarily suitable for any particular person or appropriate in accordance with local law. HSBC Bank. This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. 232595). HSBC makes no guarantee. The Hongkong and Shanghai Banking Fort. it is not intended for and should not be distributed to retail customers in Hong Kong. The information and opinions contained within the research reports are based upon publicly available information and rates of taxation applicable at the time of publication which are subject to change from time to time. All inquiries by such recipients must be directed to The Hongkong and Shanghai Banking Corporation Limited. No consideration has been given to the particular investment objectives. In Korea. Where distributed to retail customers. Moscow. mechanical. Stockholm. this publication has been distributed by The Hongkong and Shanghai Banking Corporation Limited (ABN 65 117 925 970. India Corporation Limited. HSBC Bank Australia Limited. This publication is not a prospectus as defined in the FSCMA. HSBC Bank Brasil SA – Banco Múltiplo. representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. ‘HK’ The Hongkong and Shanghai Banking Corporation HSBC Securities and Capital Markets Limited. In Japan. or transmitted. The Hongkong and Shanghai Banking Corporation Limited.