9.

75

March 30, 2018

Shariah Compliant

Top Glove (TOPG MK) HOLD

Miniscule acquisition Share Price
12m Price Target
MYR 9.75
MYR 9.85 (+1%)
Previous Price Target MYR 9.85

Diversifying business; maintain HOLD Company Description

Top Glove is world's biggest glove manufacturer with
Top Glove is buying a small medical supplies manufacturer for MYR3m
a balanced product mix in latex/nitrile examination
cash (0.02% of Top Glove’s market cap). We are neutral on the deal as gloves and non-examination gloves.
the acquisition multiple is low at historical 5x PER, but will have
insignificant impact to Top Glove’s earnings (<0.1% to our projected
FY8/19 net profit). Maintain our earnings forecasts, HOLD call and TP of Statistics
MYR9.85 (25x PER; +2SD to mean). 52w high/low (MYR) 10.10/4.57
Industrials

3m avg turnover (USDm) 9.0

Buying medical supplies manufacturer Free float (%) 50.1
Issued shares (m) 1,258
Top Glove has entered into a share purchase agreement (SPA) to acquire Market capitalisation MYR12.3B
an 85% equity interest in Duramedical Sdn Bhd from Mr Chang Ah Kau USD3.2B
(deceased) and Mr Chang Peng Hoong. The total purchase consideration Major shareholders:
amounts to MYR3m cash and the deal is expected to complete in 3Q18. LIM WEE CHAI 29.4%
Duramedical is principally involved in the business of manufacturing, sale Employees Provident Fund 6.1%
and export of rubber dental dams, exercise bands and other latex/rubber Firstway United Corp. 5.1%

related products catering to the medical industry.

Malaysia

Price Performance
Cheap acquisition but insignificant impact 11.0 220

We are neutral on this deal: (i) the transacted multiple is low at 5x PER. 10.0 200

We understand that Duramedical’s most recent annual revenue/net 9.0 180

profit are MYR2m/MYR0.6m respectively and its net debt is low at 8.0 160
c.MYR1m; (ii) the acquisition will help Top Glove in diversifying its
7.0 140
earnings and requires zero additional marketing cost as Top Glove can
6.0 120
cross-sell Duramedical’s products to its existing customers; (iii) however,
the acquisition will have insignificant impact to Top Glove’s earnings. We 5.0 100

estimate that Duramedical will contribute <0.1% to Top Glove’s FY8/19 4.0
Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
80

net profit and our projected FY19 net gearing will remain at 54%.
Top Glove - (LHS, MYR) Top Glove / Kuala Lumpur Composite Index - (RHS, %)

Maintain earnings forecasts -1M -3M -12M

We maintain our earnings forecasts, expecting the acquisition of Aspion Absolute (%) 0 22 95
to lift its near-term earnings. Relative to index (%) 0 18 84
Source: FactSet

FYE Aug (MYR m) FY16A FY17A FY18E FY19E FY20E

Revenue 2,889 3,409 4,189 5,084 5,632 Top Glove: Sales volume breakdown (2QFY18)
EBITDA 523 485 662 825 926
Core net profit 361 333 443 511 552
Core EPS (sen) 28.9 26.5 35.1 40.1 43.3
Core EPS growth (%) 27.9 (8.0) 32.3 14.1 8.0
Net DPS (sen) 14.5 14.5 17.6 20.0 21.6
Core P/E (x) 33.8 36.7 27.8 24.3 22.5
P/BV (x) 6.7 6.1 5.5 5.0 4.5
Net dividend yield (%) 1.5 1.5 1.8 2.1 2.2
ROAE (%) 21.1 17.4 20.9 21.7 21.1
ROAA (%) 13.5 11.9 11.5 10.6 11.1
EV/EBITDA (x) 9.6 14.4 20.8 16.7 14.7
Net gearing (%) (incl perps) net cash net cash 64.4 53.8 42.2
Consensus net profit - - 443 531 602
MKE vs. Consensus (%) - - (0.0) (3.7) (8.3)

Lee Yen Ling Source: Company

lee.yl@maybank-ib.com
(603) 2297 8691

THIS REPORT HAS BEEN PREPARED BY MAYBANK INVESTMENT BANK BERHAD PP16832/01/2013 (031128)
SEE PAGE 7 FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS
Top Glove

Top Glove: Capacity expansion plan in 2018

New plants planned Location Glove type No. of production lines Capacity (b pcs p.a.) Target commencement
F31 Klang, Malaysia Nitrile 30 3.0 Jun-18
F32 Klang, Malaysia Nitrile 48 4.8 Jan-19
Total expansion by Dec 2018 78 7.8

Add: Existing 25 factories 550 51.9

Total capacity by Dec 2018 628 59.7
Source: Company, Maybank Kim Eng

Top Glove: One-year rolling forward PER (trading at 26x now) Top Glove: Foreign shareholding (Feb 2018: 34%)

PE (x) 45%
28 43%
43% 42%
26
+2SD: 23.8x 42%
24 41%
39%
22
+1SD: 20.0x 39% 40%
20 37% 37%
18 37%
Mean: 16.2x
16 34%
35%
14 33%
-1SD: 12.4x
12 33% 32%
32%
10 31%
31%
8 31%
6 29%
Dec-10

Dec-11

Dec-12

Dec-13

Dec-14

Mar-17
Oct-15

Mar-16
May-16

May-17
Sep-15

Sep-16

Sep-17

Feb-18
Jun-10

Jun-11

Jun-12

Jun-13

Jun-14

Jun-15

Jul-16
Nov-15

Nov-16

Nov-17
Jan-13

Jan-14

Jan-15

Jan-16

Jan-17

Jan-18
Apr-13

Oct-13

Apr-14

Oct-14

Apr-15

Oct-15

Apr-16

Oct-16

Apr-17

Oct-17
Jul-13

Jul-14

Jul-15

Jul-16

Jul-17

Source: Bloomberg, Company, Maybank Kim Eng Source: Company

March 30, 2018 2

Top Glove

Value Proposition Price Drivers

 World’s largest glove manufacturer (global demand market Historical share price trend
share: c.19%) and still riding on the global secular growth 11.0 500
4
cycle (6-8% p.a.). 10.0 450
 High barriers to entry for medical gloves which necessitate 9.0
2
400
stringent compliance to regulatory requirement. Scale of 8.0 350
7.0 300
business model makes ASPs highly competitive.
6.0 3 250
 High cash generating capability; annual operating cashflow 5.0 200
1
of MYR400-500m against MYR250m capex. Large headroom 4.0 150
for dividends and growing cash reserves for M&A 3.0 100
opportunities. 2.0 50
Mar-13 Mar-14 Mar-15 Mar-16 Mar-17
 Sales volume growth (3-year CAGR: 9%) could accelerate
on the exit of smaller glove players. Top Glove - (LHS, MYR) Top Glove / MSCI AC Asia ex JP - (RHS, %)
 Implements cost pass-through mechanism to reflect
changes in USD/MYR and rubber prices. Source: Company, Maybank Kim Eng

Expands capacity to capture new demand growth

Global glove demand: b pieces (RHS) 1. Weaker earnings in FY14 on lower demand for latex
Capacity year-end: b pieces (LHS) gloves as market’s preference shifted to nitrile gloves
Sales volume: b pieces (LHS) and Top Glove was still in the midst of building up its
b pieces b pieces
70 350 nitrile capacity.
60 300 2. Staged strong earnings growth in FY15 on high USD/MYR,
50 250 low rubber prices and limited competition in latex gloves
40 200 segment.
30 150 3. Earnings corrected upon the weakening of USD/MYR and
20 100 intense ASP competition given the massive new capacity
10 50 from industry players.
0 0
4. Multiple expanded as it benefitted from the supply cut in
FY13 FY14 FY15 FY16 FY17 FY18F China and the EPS-accretive acquisition of Aspion.
Source: Company, Maybank KE

Financial Metrics Swing Factors

 Largest profit base and with EBITDA margins of 14-18% in Upside
FY15-17, Top Glove is amongst the highest in the sector.
 Despite weakening USD/MYR, earnings could sustain on  A structural change in the lenient regulatory
sales volume growth and earnings contribution from requirements in developing markets which could
Aspion. accelerate the global glove demand growth.
 Every 10% increase in USD/MYR and rubber raw material  Sharp fall in rubber prices.
prices will have 30% positive impact and 3% adverse  Substantial rise in USD/MYR.
impact to our FY19 bottomline respectively, assuming no
corresponding adjustments to ASPs.
Downside
Rubber prices and USD/MYR trends
Latex (LHS) NBR (LHS) USD/MYR (RHS)  Sharp fall in USD/MYR.
MYR/kg USD/MYR  Substantial rise in rubber prices.
9 5.00
 Undisciplined capacity expansion by industry players may
8 4.50
4.00
lead to intense competition.
7
3.50
6
3.00
5
2.50
4 2.00
3 1.50
2 1.00
Jan-14

Jan-15

Jan-16

Jan-17

Jan-18
Apr-14

Oct-14

Apr-15

Oct-15

Apr-16

Oct-16

Apr-17

Oct-17
Jul-14

Jul-15

Jul-16

Jul-17

Source: Bloomberg, Maybank KE

lee.yl@maybank-ib.com

March 30, 2018 3

Top Glove

FYE 31 Aug FY16A FY17A FY18E FY19E FY20E

Key Metrics
P/E (reported) (x) 17.5 19.6 27.8 24.3 22.5
Core P/E (x) 33.8 36.7 27.8 24.3 22.5
P/BV (x) 6.7 6.1 5.5 5.0 4.5
P/NTA (x) 6.8 6.2 6.3 5.7 5.0
Net dividend yield (%) 1.5 1.5 1.8 2.1 2.2
FCF yield (%) 1.8 nm nm 3.1 3.9
EV/EBITDA (x) 9.6 14.4 20.8 16.7 14.7
EV/EBIT (x) 12.1 18.7 25.8 20.9 18.4
INCOME STATEMENT (MYR m)
Revenue 2,888.5 3,409.2 4,188.5 5,084.2 5,632.5
Gross profit 577.7 681.8 858.6 1,093.1 1,211.0
EBITDA 523.3 485.0 662.5 825.4 926.2
Depreciation (107.7) (111.8) (128.9) (165.6) (185.5)
Amortisation 0.0 0.0 0.0 0.0 0.0
EBIT 415.5 373.2 533.5 659.8 740.7
Net interest income /(exp) 25.8 10.9 (6.2) (45.0) (44.8)
Associates & JV 1.3 (1.0) (1.0) (1.0) (1.0)
Exceptionals 0.0 0.0 0.0 0.0 0.0
Other pretax income 0.0 0.0 0.0 0.0 0.0
Pretax profit 442.6 383.1 522.2 614.0 682.3
Income tax (79.9) (50.5) (79.4) (102.9) (130.3)
Minorities (1.7) 0.1 0.1 0.1 0.1
Perpetual securities 0.0 0.0 0.0 0.0 0.0
Discontinued operations 0.0 0.0 0.0 0.0 0.0
Reported net profit 361.1 332.7 442.9 511.3 552.1
Core net profit 361.1 332.7 442.9 511.3 552.1
Preferred Dividends 0.0 0.0 0.0 0.0 0.0
BALANCE SHEET (MYR m)
Cash & Short Term Investments 703.2 447.0 433.3 283.4 256.4
Accounts receivable 345.9 422.2 518.7 629.6 697.5
Inventory 263.7 315.8 388.0 470.9 521.7
Reinsurance assets 0.0 0.0 0.0 0.0 0.0
Property, Plant & Equip (net) 1,239.0 1,606.6 3,007.6 3,092.0 3,156.5
Intangible assets 22.8 22.8 287.8 287.8 287.8
Investment in Associates & JVs 4.1 0.4 (0.6) (1.6) (2.5)
Other assets 69.2 126.5 126.5 126.5 126.5
Total assets 2,647.8 2,941.1 4,761.2 4,888.7 5,043.7
ST interest bearing debt 298.3 314.6 314.6 314.6 314.6
Accounts payable 331.0 419.5 515.4 625.7 693.1
Insurance contract liabilities 0.0 0.0 0.0 0.0 0.0
LT interest bearing debt 101.1 61.8 1,559.8 1,309.8 1,109.8
Other liabilities 91.0 129.0 133.0 145.0 157.0
Total Liabilities 821.7 924.5 2,523.3 2,395.2 2,274.4
Shareholders Equity 1,818.3 2,007.4 2,228.9 2,484.5 2,760.6
Minority Interest 7.8 9.2 9.1 8.9 8.8
Total shareholder equity 1,826.1 2,016.6 2,237.9 2,493.4 2,769.4
Perpetual securities 0.0 0.0 0.0 0.0 0.0
Total liabilities and equity 2,647.8 2,941.1 4,761.2 4,888.7 5,043.7
CASH FLOW (MYR m)
Pretax profit 442.6 383.1 522.2 614.0 682.3
Depreciation & amortisation 107.7 111.8 128.9 165.6 185.5
Adj net interest (income)/exp (25.8) (10.9) 6.2 45.0 44.8
Change in working capital 20.4 (44.7) (72.8) (83.6) (51.2)
Cash taxes paid (98.5) (65.5) (79.4) (102.9) (130.3)
Other operating cash flow 0.0 0.0 0.0 0.0 0.0
Cash flow from operations 446.2 388.9 506.1 639.0 732.1
Capex (228.0) (447.1) (1,530.0) (250.0) (250.0)
Free cash flow 218.2 (58.2) (1,023.9) 389.0 482.1
Dividends paid (168.9) (181.7) (221.5) (255.6) (276.1)
Equity raised / (purchased) 22.3 0.0 0.0 0.0 0.0
Perpetual securities 0.0 0.0 0.0 0.0 0.0
Change in Debt (197.5) (24.8) 1,233.0 (250.0) (200.0)
Perpetual securities distribution 0.0 0.0 0.0 0.0 0.0
Other invest/financing cash flow 292.6 284.2 (1.3) (33.3) (33.1)
Effect of exch rate changes 0.0 0.0 0.0 0.0 0.0
Net cash flow 185.0 20.2 (13.7) (149.9) (27.1)

March 30, 2018 4

Top Glove

FYE 31 Aug FY16A FY17A FY18E FY19E FY20E

Key Ratios
Growth ratios (%)
Revenue growth 15.1 18.0 22.9 21.4 10.8
EBITDA growth 15.2 (7.3) 36.6 24.6 12.2
EBIT growth 16.9 (10.2) 43.0 23.7 12.3
Pretax growth 21.8 (13.4) 36.3 17.6 11.1
Reported net profit growth 29.0 (7.9) 33.1 15.4 8.0
Core net profit growth 29.0 (7.9) 33.1 15.4 8.0

Profitability ratios (%)

EBITDA margin 18.1 14.2 15.8 16.2 16.4
EBIT margin 14.4 10.9 12.7 13.0 13.1
Pretax profit margin 15.3 11.2 12.5 12.1 12.1
Payout ratio 50.3 54.6 50.0 50.0 50.0

DuPont analysis
Net profit margin (%) 12.5 9.8 10.6 10.1 9.8
Revenue/Assets (x) 1.1 1.2 0.9 1.0 1.1
Assets/Equity (x) 1.5 1.5 2.1 2.0 1.8
ROAE (%) 21.1 17.4 20.9 21.7 21.1
ROAA (%) 13.5 11.9 11.5 10.6 11.1

Liquidity & Efficiency

Cash conversion cycle 34.9 29.3 27.9 27.9 29.1
Days receivable outstanding 46.2 40.6 40.4 40.7 42.4
Days inventory outstanding 40.5 38.2 38.0 38.7 40.4
Days payables outstanding 51.8 49.5 50.5 51.5 53.7
Dividend cover (x) 2.0 1.8 2.0 2.0 2.0
Current ratio (x) 2.0 1.6 1.6 1.5 1.4

Leverage & Expense Analysis

Asset/Liability (x) 3.2 3.2 1.9 2.0 2.2
Net gearing (%) (incl perps) net cash net cash 64.4 53.8 42.2
Net gearing (%) (excl. perps) net cash net cash 64.4 53.8 42.2
Net interest cover (x) na na 86.0 14.7 16.5
Debt/EBITDA (x) 0.8 0.8 2.8 2.0 1.5
Capex/revenue (%) 7.9 13.1 36.5 4.9 4.4
Net debt/ (net cash) (303.7) (70.6) 1,441.1 1,341.0 1,168.0
Source: Company; Maybank

March 30, 2018 5

Top Glove

Research Offices
REGIONAL MALAYSIA HONG KONG / CHINA THAILAND
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NGUYEN Thanh Lam

(84 28) 44 555 888 x 8086
thanhlam.nguyen@maybank-kimeng.com.vn
• Technical Analysis

March 30, 2018 6

Top Glove

APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLAIMERS AND DISCLOSURES

DISCLAIMERS
This research report is prepared for general circulation and for information purposes only and under no circumstances should it be considered or intended as
an offer to sell or a solicitation of an offer to buy the securities referred to herein. Investors should note that values of such securities, if any, may fluctuate
and that each security’s price or value may rise or fall. Opinions or recommendations contained herein are in form of technical ratings and fundamental
ratings. Technical ratings may differ from fundamental ratings as technical valuations apply different methodologies and are purely based on price and
volume-related information extracted from the relevant jurisdiction’s stock exchange in the equity analysis. Accordingly, investors’ returns may be less than
the original sum invested. Past performance is not necessarily a guide to future performance. This report is not intended to provide personal investment
advice and does not take into account the specific investment objectives, the financial situation and the particular needs of persons who may receive or read
this report. Investors should therefore seek financial, legal and other advice regarding the appropriateness of investing in any securities or the investment
strategies discussed or recommended in this report.
The information contained herein has been obtained from sources believed to be reliable but such sources have not been independently verified by Maybank
Investment Bank Berhad, its subsidiary and affiliates (collectively, “MKE”) and consequently no representation is made as to the accuracy or completeness of
this report by MKE and it should not be relied upon as such. Accordingly, MKE and its officers, directors, associates, connected parties and/or employees
(collectively, “Representatives”) shall not be liable for any direct, indirect or consequential losses or damages that may arise from the use or reliance of this
report. Any information, opinions or recommendations contained herein are subject to change at any time, without prior notice.
This report may contain forward looking statements which are often but not always identified by the use of words such as “anticipate”, “believe”, “estimate”,
“intend”, “plan”, “expect”, “forecast”, “predict” and “project” and statements that an event or result “may”, “will”, “can”, “should”, “could” or “might”
occur or be achieved and other similar expressions. Such forward looking statements are based on assumptions made and information currently available to us
and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those expressed in any forward looking
statements. Readers are cautioned not to place undue relevance on these forward-looking statements. MKE expressly disclaims any obligation to update or
revise any such forward looking statements to reflect new information, events or circumstances after the date of this publication or to reflect the occurrence
of unanticipated events.
MKE and its officers, directors and employees, including persons involved in the preparation or issuance of this report, may, to the extent permitted by law,
from time to time participate or invest in financing transactions with the issuer(s) of the securities mentioned in this report, perform services for or solicit
business from such issuers, and/or have a position or holding, or other material interest, or effect transactions, in such securities or options thereon, or other
investments related thereto. In addition, it may make markets in the securities mentioned in the material presented in this report. One or more directors,
officers and/or employees of MKE may be a director of the issuers of the securities mentioned in this report to the extent permitted by law.
This report is prepared for the use of MKE’s clients and may not be reproduced, altered in any way, transmitted to, copied or distributed to any other party in
whole or in part in any form or manner without the prior express written consent of MKE and MKE and its Representatives accepts no liability whatsoever for
the actions of third parties in this respect.
This report is not directed to or intended for distribution to or use by any person or entity who is a citizen or resident of or located in any locality, state,
country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. This report is for distribution only
under such circumstances as may be permitted by applicable law. The securities described herein may not be eligible for sale in all jurisdictions or to certain
categories of investors. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply based on
geographical location of the person or entity receiving this report.
Malaysia
Opinions or recommendations contained herein are in the form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental
ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from Bursa Malaysia
Securities Berhad in the equity analysis.
Singapore
This report has been produced as of the date hereof and the information herein may be subject to change. Maybank Kim Eng Research Pte. Ltd. (“Maybank
KERPL”) in Singapore has no obligation to update such information for any recipient. For distribution in Singapore, recipients of this report are to contact
Maybank KERPL in Singapore in respect of any matters arising from, or in connection with, this report. If the recipient of this report is not an accredited
investor, expert investor or institutional investor (as defined under Section 4A of the Singapore Securities and Futures Act), Maybank KERPL shall be legally
liable for the contents of this report, with such liability being limited to the extent (if any) as permitted by law.
Thailand
Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of Maybank
Kim Eng Securities (Thailand) Public Company Limited. Maybank Kim Eng Securities (Thailand) Public Company Limited (“MBKET”) accepts no liability
whatsoever for the actions of third parties in this respect.
Due to different characteristics, objectives and strategies of institutional and retail investors, the research reports of MBKET Institutional and Retail Research
Department may differ in either recommendation or target price, or both. MBKET Retail Research is intended for retail investors (http://kelive.maybank-
ke.co.th) while Maybank Kim Eng Institutional Research is intended only for institutional investors based outside Thailand only.
The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the
Office of the Securities and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand
and the market for Alternative Investment disclosed to the public and able to be accessed by a general public investor. The result, therefore, is from the
perspective of a third party. It is not an evaluation of operation and is not based on inside information. The survey result is as of the date appearing in the
Corporate Governance Report of Thai Listed Companies. As a result, the survey may be changed after that date. MBKET does not confirm nor certify the
accuracy of such survey result.
The disclosure of the Anti-Corruption Progress Indicators of a listed company on the Stock Exchange of Thailand, which is assessed by Thaipat Institute, is made
in order to comply with the policy and sustainable development plan for the listed companies of the Office of the Securities and Exchange Commission.
Thaipat Institute made this assessment based on the information received from the listed company, as stipulated in the form for the assessment of Anti-
corruption which refers to the Annual Registration Statement (Form 56-1), Annual Report (Form 56-2), or other relevant documents or reports of such listed
company. The assessment result is therefore made from the perspective of Thaipat Institute that is a third party. It is not an assessment of operation and is not
based on any inside information. Since this assessment is only the assessment result as of the date appearing in the assessment result, it may be changed after
that date or when there is any change to the relevant information. Nevertheless, MBKET does not confirm, verify, or certify the accuracy and completeness of
the assessment result.
US
This third-party research report is distributed in the United States (“US”) to Major US Institutional Investors (as defined in Rule 15a-6 under the Securities
Exchange Act of 1934, as amended) only by Maybank Kim Eng Securities USA Inc (“Maybank KESUSA”), a broker-dealer registered in the US (registered under
Section 15 of the Securities Exchange Act of 1934, as amended). All responsibility for the distribution of this report by Maybank KESUSA in the US shall be borne
by Maybank KESUSA. This report is not directed at you if MKE is prohibited or restricted by any legislation or regulation in any jurisdiction from making it
available to you. You should satisfy yourself before reading it that Maybank KESUSA is permitted to provide research material concerning investments to you
under relevant legislation and regulations. All U.S. persons receiving and/or accessing this report and wishing to effect transactions in any security mentioned
within must do so with: Maybank Kim Eng Securities USA Inc. 777 Third Avenue 21st Floor New York, New York 1- (212) 688-8886 and not with, the issuer of
this report.
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UK
This document is being distributed by Maybank Kim Eng Securities (London) Ltd (“Maybank KESL”) which is authorized and regulated, by the Financial Conduct
Authority and is for Informational Purposes only. This document is not intended for distribution to anyone defined as a Retail Client under the Financial
Services and Markets Act 2000 within the UK. Any inclusion of a third party link is for the recipients convenience only, and that the firm does not take any
responsibility for its comments or accuracy, and that access to such links is at the individuals own risk. Nothing in this report should be considered as
constituting legal, accounting or tax advice, and that for accurate guidance recipients should consult with their own independent tax advisers.
DISCLOSURES

Legal Entities Disclosures

Malaysia: This report is issued and distributed in Malaysia by Maybank Investment Bank Berhad (15938- H) which is a Participating Organization of Bursa
Malaysia Berhad and a holder of Capital Markets and Services License issued by the Securities Commission in Malaysia. Singapore: This report is distributed in
Singapore by Maybank KERPL (Co. Reg No 198700034E) which is regulated by the Monetary Authority of Singapore. Indonesia: PT Maybank Kim Eng Securities
(“PTMKES”) (Reg. No. KEP-251/PM/1992) is a member of the Indonesia Stock Exchange and is regulated by the Financial Services Authority (Indonesia).
Thailand: MBKET (Reg. No.0107545000314) is a member of the Stock Exchange of Thailand and is regulated by the Ministry of Finance and the Securities and
Exchange Commission. Philippines: Maybank ATRKES (Reg. No.01-2004-00019) is a member of the Philippines Stock Exchange and is regulated by the Securities
and Exchange Commission. Vietnam: Maybank Kim Eng Securities Limited (License Number: 117/GP-UBCK) is licensed under the State Securities Commission of
Vietnam. Hong Kong: KESHK (Central Entity No AAD284) is regulated by the Securities and Futures Commission. India: Kim Eng Securities India Private Limited
(“KESI”) is a participant of the National Stock Exchange of India Limited and the Bombay Stock Exchange and is regulated by Securities and Exchange Board of
India (“SEBI”) (Reg. No. INZ000010538). KESI is also registered with SEBI as Category 1 Merchant Banker (Reg. No. INM 000011708) and as Research Analyst (Reg
No: INH000000057) US: Maybank KESUSA is a member of/ and is authorized and regulated by the FINRA – Broker ID 27861. UK: Maybank KESL (Reg No 2377538)
is authorized and regulated by the Financial Conduct Authority.

Disclosure of Interest
Malaysia: MKE and its Representatives may from time to time have positions or be materially interested in the securities referred to herein and may further
act as market maker or may have assumed an underwriting commitment or deal with such securities and may also perform or seek to perform investment
banking services, advisory and other services for or relating to those companies.
Singapore: As of 30 March 2018, Maybank KERPL and the covering analyst do not have any interest in any companies recommended in this research report.
Thailand: MBKET may have a business relationship with or may possibly be an issuer of derivative warrants on the securities /companies mentioned in the
research report. Therefore, Investors should exercise their own judgment before making any investment decisions. MBKET, its associates, directors, connected
parties and/or employees may from time to time have interests and/or underwriting commitments in the securities mentioned in this report.
Hong Kong: As of 30 March 2018, KESHK and the authoring analyst do not have any interest in any companies recommended in this research report.
India: As of 30 March 2018, and at the end of the month immediately preceding the date of publication of the research report, KESI, authoring analyst or their
associate / relative does not hold any financial interest or any actual or beneficial ownership in any shares or having any conflict of interest in the subject
companies except as otherwise disclosed in the research report.

In the past twelve months KESI and authoring analyst or their associate did not receive any compensation or other benefits from the subject companies or
third party in connection with the research report on any account what so ever except as otherwise disclosed in the research report.
MKE may have, within the last three years, served as manager or co-manager of a public offering of securities for, or currently may make a primary market
in issues of, any or all of the entities mentioned in this report or may be providing, or have provided within the previous 12 months, significant advice or
investment services in relation to the investment concerned or a related investment and may receive compensation for the services provided from the
companies covered in this report.

OTHERS
Analyst Certification of Independence
The views expressed in this research report accurately reflect the analyst’s personal views about any and all of the subject securities or issuers; and no part
of the research analyst’s compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in the report.

Reminder
Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to sophisticated investors who are
capable of understanding and assuming the risks involved. The market value of any structured security may be affected by changes in economic, financial
and political factors (including, but not limited to, spot and forward interest and exchange rates), time to maturity, market conditions and volatility and the
credit quality of any issuer or reference issuer. Any investor interested in purchasing a structured product should conduct its own analysis of the product and
consult with its own professional advisers as to the risks involved in making such a purchase.

No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior consent of MKE.

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Historical recommendations and target price: Top Glove (TOPG MK)

30 Sep 5 Oct 13 Oct 16 Dec 6 Jan 15 Mar 15 Jun 20 Dec 15 Jan

Hold : RM4.1 Sell : RM4.1 Sell : RM4.3 Hold : RM5.3 Hold : RM5.4 Buy : RM6.2 Hold : RM6.2 Hold : RM7.5 Hold : RM9.9

12.0

10.0

8.0

6.0

4.0
Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18

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Definition of Ratings
Maybank Kim Eng Research uses the following rating system
BUY Return is expected to be above 10% in the next 12 months (excluding dividends)
HOLD Return is expected to be between - 10% to +10% in the next 12 months (excluding dividends)
SELL Return is expected to be below -10% in the next 12 months (excluding dividends)

Applicability of Ratings
The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only
applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment
ratings as we do not actively follow developments in these companies.

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 Malaysia  Singapore  London  New York

Maybank Investment Bank Berhad Maybank Kim Eng Securities Pte Ltd Maybank Kim Eng Securities Maybank Kim Eng Securities USA
(A Participating Organisation of Maybank Kim Eng Research Pte Ltd (London) Ltd Inc
Bursa Malaysia Securities Berhad) 50 North Canal Road PNB House 777 Third Avenue, 21st Floor
33rd Floor, Menara Maybank, Singapore 059304 77 Queen Victoria Street New York, NY 10017, U.S.A.
100 Jalan Tun Perak, London EC4V 4AY, UK
50050 Kuala Lumpur Tel: (65) 6336 9090 Tel: (212) 688 8886
Tel: (603) 2059 1888; Tel: (44) 20 7332 0221 Fax: (212) 688 3500
Fax: (603) 2078 4194 Fax: (44) 20 7332 0302

Stockbroking Business:  Hong Kong  Indonesia  India

Level 8, Tower C, Dataran Maybank,
Kim Eng Securities (HK) Ltd PT Maybank Kim Eng Securities Kim Eng Securities India Pvt Ltd
No.1, Jalan Maarof 28/F, Lee Garden Three, Sentral Senayan III, 22nd Floor 2nd Floor, The International,
59000 Kuala Lumpur
1 Sunning Road, Causeway Bay, Jl. Asia Afrika No. 8 16, Maharishi Karve Road,
Tel: (603) 2297 8888
Hong Kong Gelora Bung Karno, Senayan Churchgate Station,
Fax: (603) 2282 5136
Jakarta 10270, Indonesia Mumbai City - 400 020, India
Tel: (852) 2268 0800
Fax: (852) 2877 0104 Tel: (62) 21 2557 1188 Tel: (91) 22 6623 2600
Fax: (62) 21 2557 1189 Fax: (91) 22 6623 2604

 Philippines  Thailand  Vietnam  Saudi Arabia

Maybank ATR Kim Eng Securities Inc.
17/F, Tower One & Exchange Plaza
Ayala Triangle, Ayala Avenue
Makati City, Philippines 1200
Tel: (63) 2 849 8888
Fax: (63) 2 848 5738
Maybank Kim Eng Securities
(Thailand) Public Company Limited
999/9 The Offices at Central World,
20th - 21st Floor,
Rama 1 Road Pathumwan,
Bangkok 10330, Thailand
Tel: (66) 2 658 6817 (sales)
Tel: (66) 2 658 6801 (research)
Maybank Kim Eng Securities Limited In association with
4A-15+16 Floor Vincom Center Dong Anfaal Capital
Khoi, 72 Le Thanh Ton St. District 1 Villa 47, Tujjar Jeddah
Ho Chi Minh City, Vietnam Prince Mohammed bin Abdulaziz
Street P.O. Box 126575
Tel : (84) 844 555 888 Jeddah 21352
Fax : (84) 8 38 271 030
Tel: (966) 2 6068686
Fax: (966) 26068787

 South Asia Sales Trading  North Asia Sales Trading

Kevin Foy Andrew Lee
Regional Head Sales Trading andrewlee@kimeng.com.hk
kevinfoy@maybank-ke.com.sg Tel: (852) 2268 0283
Tel: (65) 6636-3620 US Toll Free: 1 877 837 7635
US Toll Free: 1-866-406-7447

Malaysia Thailand
Joann Lim Tanasak Krishnasreni
joann.lim@maybank-ib.com Tanasak.K@maybank-ke.co.th
Tel: (603) 2717 5166 Tel: (66)2 658 6820

Indonesia London
Harianto Liong Mark Howe
harianto.liong@maybank-ke.co.id mhowe@maybank-ke.co.uk
Tel: (62) 21 2557 1177 Tel: (44) 207-332-0221

New York India

James Lynch Sanjay Makhija
jlynch@maybank-keusa.com sanjaymakhija@maybank-ke.co.in
Tel: (212) 688 8886 Tel: (91)-22-6623-2629

Vietnam Philippines
Patrick Mitchell Keith Roy
patrick.mitchell@maybank-kimeng.com.vn keith_roy@maybank-atrke.com
Tel: (84)-8-44-555-888 x8080 Tel: (63) 2 848-5288
www.maybank-ke.com | www.maybank-keresearch.com

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