M.M. Securities (Pvt.

) Ltd Equity
Synergy of Finance & Opportunities
INITIATING COVERAGE
May 19, 2010

FAUJI FERTILIZER BIN QASIM LIMITED

We initiate our coverage on Fauji Fertilizer Bin Qasim Ltd

(FFBL) with a DCF & DDM based fair value of PKR 34.77/ Shahid Ali
share. We recommend ‘BUY’ stance on FFBL as its currently Senior Research Analyst
offering upside potential of 22.0% from our fair value along shahid@mmsecurities.com.pk
with the attractive dividend yield of 11.7%. Our key assump- +92-21-35317703 Ext. 111
tion for the fair value of the company includes required re-
turn of 18.08%, risk premium of 6.0%, beta of 0.93 and a ter-
minal growth rate of 4.0%. Moreover, FFBL is presently trad- Recommendation BUY
ing at discounted PEx of 6.99 and PBx of 2.33 CY10E.
Current Price - As of May 17, 2010 PKR 28.51

Investment Rational Fair Value xd - (DCF & DDM ) PKR 34.77

Upside Potential % 22.0%
 FFBL is the sole producer of Di-ammonia Phosphate EPS - 2010E PKR 4.08
(DAP) in the country with the design capacity of 600 EPS - 2011E PKR 4.44
thousand (k) tons. DAP segment is the key driver for the DPS - 2010E PKR 3.34
profitability of the company. DPS - 2011E PKR 3.78
Div Yield 2010E % 11.7%
 FFBL profitability is mainly driven by the DAP segment Div Yield 2011E % 13.3%
of the company, as its contribution towards the top line of P/E 2010E
x 6.99
the company is ~63% whereas the trickledown impact in
P/E 2011E x 6.43
the bottom line earnings is ~78%.

 The decision of gas curtailment to fertilizer industry for

KATS Code FFBL
100 days by the government will have higher negative
impact on FFBL profitability as compared to FFC & Engro Bloomberg Code FFBL.PA
due to the reason that FFBL gas supply will be reduced Outstanding Shares mn 934.1
by 20% against 12% for FFC & Engro. Market Capitalization PKR-mn 26,631
Share in KSE 100 Index % 1.05
 FFBL has offered one of the strongest dividend payout 1Yr High - Low PKR 33.6 - 16.7
ratio 88% in last five years. We expect company payout Daily Avg Volume in '000 3,969
ratio will be on slightly lower side 83.6% in forthcoming
two years as company has plan to invest PKR 5.0bn in the
power sector.
Relative Price Performance—PKR
Key risk to our valuation
40.0 FFBL KSE 100 Index
 Substantial decline in International DAP Prices as in 35.0
CY08, may result in substantial decline in earnings of the 30.0
25.0
company putting a negative impact on the valuation of
20.0
the company. 15.0
10.0
 Further curtailment of gas supply to fertilizer sector due 5.0
to depleting reserves of natural gas in the country or sub- -

stitution of gas in favor of other sector.

May-09

May-10
Mar-09

Mar-10
Jan-09

Jan-10
Jul-09

Nov-09
Sep-09

Disclaimer: This report has been prepared by MMSPL. The information and opinions contained herein have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good
faith. Such information has not been independently verified and no guaranty, representation or warranty, express or implied is made as to its accuracy, completeness or correctness. All such information and opinions are
subject to change without notice. This document is for information purposes only. Descriptions of any company or companies or their securities mentioned herein are not intended to be complete and this document is not,
and should not be construed as, an offer, or solicitation of an offer, to buy or sell any securities or other financial instruments. MMSPL may, to the extent permissible by applicable law or regulation, use the above material,
conclusions, research or analysis before such material is disseminated to its customers. Not all customers will receive the material at the same time. MMSPL, their respective directors, officers, representatives, employees,
related persons may have a long or short position in any of the securities or other financial instruments mentioned or issuers described herein at any time and may make a purchase and/or sale, or offer to make a purchase
and/or sale of any such securities or other financial instruments from time to time in the open market or otherwise, either as principal or agent. MMSPL may make markets in securities or other financial instruments de-
scribed in this publication, in securities of issuers described herein or in securities underlying or related to such securities. This document may not be reproduced, distributed or published for any purposes.
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

FFBL - the only producer of DAP & Granular Urea in the country

FFBL is the sole producer of Di-ammonia Phosphate (DAP) in the

country with the design capacity of 600 thousand (k) tons. DAP
segment is the key driver for the profitability of the company.
Further, FFBL is a sole producer of a higher grade of Urea namely
Granular Urea that gives a competitive advantage to the company
over its peer companies.

FFBL earnings is mainly driven by DAP segment

To attain the optimum crop yield Agri experts recommend bal-

ance use of urea and fertilizer products i.e. 2:1 (N:P ratio). DAP Production V/S Offtake (ktons)
Source : Company Report & MMSPL Research
Whereas, the huge price differential in local urea and DAP prices Production Offtake
800
forced local farmers to uses higher urea over DAP resulting low
crop yield and historically this ratio stand in the range of 3.78:1 in 700
our country. The demand of the product is mainly depends on the
600
purchasing power parity of the farmers.
500
During CY10, we expect the overall demand of DAP to register a 400
minor dip of ~2.0% from 1,767k tons in CY09 to 1,731k tons owing
to expected higher DAP prices in the current year. Further, in 300
1QCY10 DAP offtakes increased to 209k tons from 189k tons in 200
the same period last year indicating significant YoY increase of
100
10.8% which is primarily on account of higher offtake in Jan’10.
-
FFBL profitability is mainly driven by the DAP segment of the

CY10E
CY05

CY06

CY07

CY08

CY09
company, as its contribution towards the top line of the company
is ~63% whereas the trickledown impact in the bottom line earn-
ings is ~78%. We anticipate that the contribution of DAP segment
will continue in the same pace in forthcoming years. We expect
FFBL DAP offtake to decline by 24.1 to 538k in CY10 tons from
709k tons in corresponding period last year, mainly due to lower DAP Market Share—CY09
inventory in the current year and production decline. However, in Source : NFDC & MMSPL Research
1QCY10 company DAP offtake has increased by 1.2% to 107k tons
from 105k tons in the same period last year.
FFBL
DAP Price Story 42%

DAP prices are mainly dependent on the prices of its raw material
(Ammonia & Phosphoric acid). The raw material for ammonia is
natural gas while phos rock and sulphur is used for phosphoric Imported
acid. DAP prices remained quite stable in the CY09 as compared 58%

to CY08 on which DAP touched its historic high of USD 1,230/ton

from USD 400/ton in the beginning of the year, mainly on ac-
count of substantial rise in international demand. With recent in-
crease in the DAP prices in international market we expect FFBL
to further increase its DAP prices by PKR 100 to PKR 120 per bag
which will help to the company offset the losses of lower DAP
production.

2
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

DAP margins are primarily backed by the prices difference be-

tween local DAP and input cost of the company mainly Phos Acid
prices. As per our calculation during last five years average DAP
margin were USD 195/ton. Moving forward, we expect DAP mar-
gin would be on the slightly higher side from its historic level of
USD 195/ton to USD 201/ton in forthcoming five year mainly
due to expected higher demand of DAP.

Going forward, we expect local DAP prices to increase at 4Yr

CAGR of 15.0% in CY10-CY14 which includes the impact of both
factors i.e. the expected increase in international DAP prices and
the expected depreciation of PKR against USD.

FFBL Produces Superior Brand of Urea

FFBL makes an important role towards boosting agricultural

growth of our country by feeding best quality nutrients to our
Urea Production V/S Offtake (ktons)
land which results in better crop productivity. FFBL is the only Source : Company Report & MMSPL Research
producer in the country which produces Granular urea the supe-
rior brand of Urea which gives a competitive advantage to the
company over peer companies. Urea segment contributes ap- 800 Production Offtake
proximately 27% in the top line of the company however, as per 700
our estimation the contribution of the segment in the bottom line
600
earnings ~22%. During CY09, urea offtake performance of the
company was not satisfactory as urea offtake for the year stood at 500
627k tons when compared to 698k tons in CY08 depicting YoY
400
decline of 10% primarily due to lower urea production. Further-
more, in 1QCY10 urea offtake of the company decline by 10.7% to 300
102k tons from 114k tons last year. 200

FFBL urea market share declined to 9.7% in CY09 from 12.5% in 100
CY08 mainly on account of higher imported urea sales by the -
NFML during the year. In 1QCY10, market share of the company
CY10E
CY05

CY06

CY07

CY08

CY09

was slightly decline by 0.2% to 7.2% owing to scheduled plant

shut down in the winter season.

Gas Curtailment Issue

Urea Market Share—CY09
Source : Company Report & MMSPL Research
The decision of gas curtailment to fertilizer industry for 100 days
by the government will have higher negative impact on FFBL NFML
22%
profitability as compared to FFC & Engro due to the reason that
EFL
FFBL gas supply will be reduced by 20% against 12% for FFC & 14% Others
Engro. Currently, the gas supply to the company has reduced by 8%

20% to 68mmcfd from 85mmcfd previously provided by Sui

Southern Gas Company (SSGC). In the recent analyst briefing, DAWH
8%
company management told that urea production of the company
has reduced by ~25% due to curtailment of natural gas. However, FFBL
the management has decided not to reduce DAP production and 10%
FFC
plans to continue the DAP production on normal basis. 38%

3
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

Urea Price story

Urea prices plays a vital role in the profitability of the company in Historic Urea Price - per bag (average)
last few years urea prices have shown a stable increasing trend as Source : Company Financials & MMSPL Research
compared to the DAP prices. In last five years urea prices were 1,000.0
averagely increased by 11.5%. However, urea prices are showing a 888.0
900.0
continuous increase YoY basis as compared to DAP prices which
show a mix trend. The local urea prices historically remained on 800.0
768.6
the lower side as compared to imported urea price. During last few 685.9
700.0
years average local urea were lower by 30% from imported urea
600.0
523.5 542.7
mainly on account of substantially subsidized gas prices, which is
one of the main raw materials for urea production. Going forward, 500.0

we expect increasing trend in urea price to continue as the feed 400.0

stock prices increases. 300.0

200.0
Urea prices surged by PKR 75/bag to offset the impact of gas cur-
tailment to the company 100.0

-
To reduces the losses caused by gas curtailment FFBL has in-

CY06

CY07

CY08

CY09

CY10E
creased per bag urea prices by PKR 75 along with other major
players of the industry. Further, management believes that the
urea prices will not immediately come down after the restoration
of gas supply by the end of July’10 the higher urea prices will con-
tinue till end of the current year.

We expect further increase of PKR 25 to PKR 30 in urea prices

Considering the huge gap between the imported and local urea
prices, which gives room to the local urea manufacture to increase
the urea prices to over come the losses arises from curtailment of
gas. FFBL being the major loser in term of gas supply cut we ex-
pect that the company will further increase urea per bag prices by
PKR 25 to PKR 30 within short period of time.

Strong Dividend Payout Maintained by the Company Dividend Payout

Source : Company Financials & MMSPL Research
120.0%
The Fauji Group (FFC & FFBL) is well known for the highest divi-
dend payout ratio in the fertilizer industry. Following the group 100.0% 91.9% 91.8%
98.7%

policy FFBL has offered one of the strongest dividend payout ratio 81.9%

of ~88% in last five years. Going forward, we expect company pay- 80.0%

out ratio will be slightly on lower side ~83.6% in forthcoming two 60.0%
years as the company has plans to invest PKR 5.0bn in the power 47.7%

sector. However, for long term we expect company will maintain 40.0%

its payout ratio in the range of ~85% to ~95%. Further, we expect 20.0%
that the company to pay cash dividend per share of PKR 3.34 for
CY10 resulting attractive dividend yield of 11.7% based on current 0.0%

market price.
CY10E
CY06

CY07

CY08

CY09

4
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

Investment in Associated Companies 1.0bn in Fauji Wind Power Ltd.

Investment in Pakistan Morocco Phosphore S.A, Investment in Cement Sector

(PMP) Morocco
FFBL has also invested PKR 300mn in its associated
In 2004 Fauji Fertilizer Bin Qasim Ltd. decided to in- company FCCL. Currently, the company holds 2.7%
vest in Morocco Phosphore project by acquiring 25% of total outstanding shares of FCCL. FCCL is one of
stake in the company. As company produces Phospho- the premier brands in the cement industry due to
ric (Phos) Acid, which is the main raw material for better quality along with one of the most cost effi-
DAP production. To ensure the continuous supply of cient and well maintained cement plants which con-
this strategic raw material to run the DAP plant at Ka- sumes approximately 50% less energy compared to
rachi, the Fauji Group entered into joint venture with other cement operators. We expect positive inflows
one of the biggest industrial groups of Morocco. The in terms of dividend from the company by the end
company was named as Pakistan Morocco Phosphore of FY10.
S.A (PMP), costing ~ MAD 2,030mn (USD 250 mn) and
was formed in Morocco.

The plant has a designed capacity of 375,000 metric

tons per annum of Phos acid which will sufficiently
cater to the total requirement of FFBL’s DAP plant,
while the surplus production of Phos acid will be ex-
ported. The project was completed successfully in a
record time and within the budget constraints. Com-
mercial production and shipment to FFBL started in
April 2008 and May 2008 respectively.

Benefits of the project

 Long-term raw material supply is guaranteed in

an extremely turbulent international market.

 Production of 375,000 MTPA of Phos acid which

will not only ensure un-interrupted supply of raw
material, catering to the entire post-BMR DAP re-
quirements of FFBL and surplus production will
be exported to other players

 The project has enhanced the profitability of the

company interim of dividends income.

Proposed PKR 5.0bn Investment in Power Sector

In order to diversify the business, FFBL has plans to

invest up to PKR 5.0bn in power sector which will
help the country to over come on power crisis as well
as it will secure future earnings of the company. As
per the initial plan FFBL will invest up to PKR 2.0bn in
Star Power Generation Ltd, PKR 1.0bn in Beacon En-
ergy Ltd, PKR 1.0bn in Green Power Pvt. Ltd. and PKR

5
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

Financial Highlights of the Company Company Profile

 The top line of the company has increased at 5Yr
CAGR of 26.2% mainly due to substantially
higher DAP and urea sales along with increase
in DAP and urea prices during the period under
review. Moreover, we expect that the top line of
the company will continue to grow at 5Yr CAGR
of 14.7% on account of growth in DAP and urea
prices along with minor growth in DAP & urea
offtake.
FFBL is a subsidiary of FFC which owns 50.88%
stake, the company is primarily engaged in the busi-
ness of DAP and Urea production. Further, company
has significant investment in Pakistan Maroc Phos-
phore, S.A. (PMP) Moroccop and Fauji cement.
Moreover, company has aggressive plans to invest ~
PKR 5.0bn in power sector of the country. Total de-
sign capacity of FFBL of Bin Qasim plants at Karachi
is 551K tons for Urea and 445.5K tons of DAP.

 Cost of production in the last five years grew at

CAGR of 27.0% due to a consistent increase in
natural gas and Phos Acid prices and substantial
increase in DAP production over the period.
Going forward, we expect that the cost of pro-
duction of the company will grow at a 5Yr
CAGR of 15.23% in the forthcoming five years,
owing to an expected increase in gas prices and
Phos Acid.

 Gross profit of the company increased by 24.3%

in last five years due to substantial rise in DAP
margins during the period under review. Shareholding Pattern as of Dec’09
Source : Company Financials
 Finance cost of the company increased at 5Y-
CAGR of 76.7%, primarily due to low base im-
pact and higher short term borrowings and long Banks & Fin Others
Ins 20.3%
term financing along with an increase in the in-
11.1%
terest rates during the period under review. NIT & ICP
0.4%
 The bottom line earnings of the company in-
creased by 15.6% in the period of CY04-CY09
Fauji Found
due to substantial higher DAP margins and in-
17.3%
crease in other income. However, the pace of
increase in bottom line earnings is expected to
slow down to a CAGR of 9.3% in the upcoming FFC
five years due to slightly lower gross margins. 50.9%

6
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

Peer Comparison
CY08 CY09
FFC FFBL ENGRO DAWH FFC FFBL ENGRO DAWH
Net Sales (PKR mn) 30,593 26,821 23,317 7,429 36,163 36,725 30,172 11,040
PAT (PKR mn) 6,525 2,900 4,240 3,063 8,823 3,784 3,957 2,653
EPS (Basic PKR) 13.22 3.10 19.93 28.00 13.00 4.05 13.28 24.25
DPS (Basic PKR) 13.75 2.85 6.00 3.50 12.76 4.00 7.00 1.50
BVPS (Baisc PKR) 24.90 11.23 110.65 158.91 19.28 11.41 98.49 181.77
Average Price(PKR) 116.24 35.55 255.17 220.30 88.23 28.79 144.05 147.03
PEx 8.79 11.45 12.81 7.87 6.79 7.11 10.85 6.06
PBVx 4.67 3.17 2.31 1.39 4.58 2.52 1.46 0.81
Dividend Yield 11.8% 8.0% 2.4% 1.0% 14.5% 13.9% 4.9% 0.0%
ROE 53.1% 27.7% 18.0% 17.6% 67.4% 35.5% 13.5% 13.3%
ROA 20.4% 6.2% 5.2% 11.9% 22.9% 10.4% 3.0% 9.0%
EBITDA Margin 38.0% 31.3% 31.6% 41.6% 41.7% 23.1% 23.9% 13.4%
Earnings growth 21.7% 14.1% 34.4% -69.8% 35.2% 30.5% -6.7% -13.4%
GP margin 40.4% 30.7% 18.2% 41.9% 43.3% 26.3% 13.1% 35.9%
Net margin 21.3% 10.8% 18.2% 41.2% 24.4% 10.3% 13.1% 24.0%
Capacity Utilizaion 113.4% 121.2% 102.1% 114.0% 120.3% 113.8% 97.6% 115.2%

7
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

Financial Highlights
P & L Statement
PKRmn CY09A CY10E CY11E CY12E CY13E CY14E
Net Sales 36,725 36,116 43,749 52,271 64,910 72,908
Cost of Sales 27,060 27,053 33,821 40,771 51,330 58,060
Gross Profit 9,665 9,063 9,928 11,500 13,580 14,848
Distribution Costs 2,236 2,253 2,720 3,246 4,034 4,529
Administrative Expenses 401 435 451 537 669 751
Finance Cost 1,460 574 593 618 683 760
Other Expenses 443 535 578 612 648 689
Other Income 683 1,043 1,067 1,243 1,331 1,349
PBT 5,808 6,054 6,653 7,730 8,878 9,467
Tax 2,024 2,245 2,510 2,932 3,351 3,570
PAT 3,784 3,809 4,144 4,798 5,527 5,897
EPS (PKR) 4.05 4.08 4.44 5.14 5.92 6.31
DPS (PKR) 4.00 3.34 3.78 4.86 5.64 6.12

Balance Sheet
PKRmn CY09A CY10E CY11E CY12E CY13E CY14E
Property, Plant & Equipment 15,577 15,236 15,376 14,969 15,042 14,787
Long Term Investments 2,128 5,123 7,788 8,013 8,158 8,253
Current Assets 18,443 9,880 8,672 7,663 9,092 10,410
Total Assets 36,225 30,409 32,315 32,245 34,123 34,755
Equity 10,660 11,408 13,201 12,114 12,638 13,121
Long Term Loan 4,537 3,889 3,241 2,593 1,945 1,296
Total non-current Liabilities 8,818 6,696 6,002 6,112 5,966 5,580
Current Liabilities 16,747 12,305 13,112 14,019 15,519 16,054
Total Equity & Liabilities 36,225 30,409 32,315 32,245 34,123 34,755

Key Ratios
CY09A CY10E CY11E CY12E CY13E CY14E
EPS (PKR) 4.05 4.08 4.44 5.14 5.92 6.31
DPS (PKR) 4.00 3.34 3.78 4.86 5.64 6.12
BVPS (PKR) 11.41 12.21 14.13 12.97 13.53 14.05
PEx 7.11 6.99 6.43 5.55 4.82 4.52
PBVx 2.52 2.33 2.02 2.20 2.11 2.03
Dividend Yield 13.9% 11.7% 13.3% 17.1% 19.8% 21.5%
EV/EVA 7.84 12.25 12.98 9.39 7.30 6.45
EV/EBITDA 2.59 3.27 3.23 2.90 2.46 2.22
ROE 35.5% 33.4% 31.4% 39.6% 43.7% 44.9%
ROA 10.4% 12.5% 12.8% 14.9% 16.2% 17.0%
EBITDA Margin 23.1% 21.9% 19.6% 18.5% 16.8% 15.9%
GP margin 26.3% 25.1% 22.7% 22.0% 20.9% 19.1%
Net margins 10.3% 10.5% 9.5% 9.2% 8.5% 8.1%

8
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM
May 19, 2010

Quarterly Financial Projections

PKRmn 1QCY10A 2QCY10E 3QCY10E 4QCY10E 1QCY11E 2QCY11E 3QCY11E 4QCY11E
Net Sales 6,566 9,031 10,066 10,453 10,117 10,676 11,228 11,728
Cost of Sales 4,756 6,494 7,612 8,190 8,009 8,263 8,681 8,868
Gross Profit 1,810 2,537 2,454 2,262 2,108 2,413 2,547 2,860
Distribution Costs 418 561 625 649 624 663 699 734
Administrative Expenses 95 95 97 148 104 110 116 121
Finance Cost 99 151 145 136 148 148 148 148
Other Expenses 95 152 143 145 107 175 147 149
Other Income 135 141 209 261 272 262 270 264
PBT 1,237 1,720 1,653 1,445 1,397 1,577 1,707 1,972
Tax 428 638 625 554 527 594 644 744
PAT 809 1,082 1,028 891 869 983 1,064 1,227
EPS (PKR) 0.87 1.16 1.10 0.95 0.93 1.05 1.14 1.31
DPS (PKR) 0.50 1.02 - 1.82 0.46 - 0.69 2.63

9
 M.M. Securities (Pvt.) Ltd Equity
Synergy of Finance & Opportunities
FAUJI FERTILIZER BIN QASIM

Research Team

Amjad Nazir Chief Operating Officer & Head of Research coo@mmsecurities.com.pk +92-21-353396983
Shahid Ali Senior Research Analyst shahid@mmsecurities.com.pk Ext. 111
Muhammad Mohsin Ali Research Officer research@mmsecurities.com.pk Ext. 104

Sales Team

Corporate
Saqib Hussain Head of Sale & Portfolio Management saqib@mmsecurities.com.pk +92-21-35313911
Sania Zulfiqar Sales Coordinator sania@mmsecurities.com.pk +92-21-35313912

Retail
Salma Aamir Senior Sales Coordinator salma@mmsecurities.com.pk +92-21-35317706
Shahzada Haris Rashid Senior Sales Coordinator hairs@mmsecurities.com.pk +92-21-35388719
Muhammad Imran Alvi Senior Sales Coordinator imran@mmsecurities.com.pk +92-21-35396982
Muhammad Farhan Senior Sales Coordinator farhan@mmsecurities.com.pk +92-21-35897063

Contact us:

M.M. Securities (Pvt.) Ltd.

M. M. Tower, 3 – C,
Khayaban-e-Ittehad,
Phase – II, Extension,
Defence Housing Authority,
Karachi – 75500, Pakistan.
P.O.Box # 12414
Tel : +9221-35317703-04
Fax: +9221-35895328
http://www.mmsecurities.com.pk
E-mail: research@mmsecurities.com.pk

Group:
http://www.mmgoc.com.pk

Analysts’ Certification:

I, Shahid Ali, the author of this report, hereby certify that all of the views expressed in this research report accurately reflect my personal
views about any and all of the subject issuer(s) or securities. I also certify that no part of my compensation was, is, or will be directly or
indirectly related to the specific recommendation(s) or view(s) in this report.

Disclaimer: This report has been prepared by MMSPL. The information and opinions contained herein have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good
faith. Such information has not been independently verified and no guaranty, representation or warranty, express or implied is made as to its accuracy, completeness or correctness. All such information and opinions are
subject to change without notice. This document is for information purposes only. Descriptions of any company or companies or their securities mentioned herein are not intended to be complete and this document is not,
and should not be construed as, an offer, or solicitation of an offer, to buy or sell any securities or other financial instruments. MMSPL may, to the extent permissible by applicable law or regulation, use the above material,
conclusions, research or analysis before such material is disseminated to its customers. Not all customers will receive the material at the same time. MMSPL, their respective directors, officers, representatives, employees,
related persons may have a long or short position in any of the securities or other financial instruments mentioned or issuers described herein at any time and may make a purchase and/or sale, or offer to make a purchase10
and/or sale of any such securities or other financial instruments from time to time in the open market or otherwise, either as principal or agent. MMSPL may make markets in securities or other financial instruments de-
scribed in this publication, in securities of issuers described herein or in securities underlying or related to such securities. This document may not be reproduced, distributed or published for any purposes.