MARKET OUTLOOK & SUMMARY REPORT Summary: 17th MARCH – 21st MARCH 2014

Outlook: 24th MARCH – 28th MARCH 2014

MARKET SUMMARY FOR LAST WEEK (17th MARCH – 21st MARCH 2014)

Stocks trade flat, oil rises as Crimea remains in focus After a volatile week driven by speculation over shifts in U.S monetary policy, world markets steadied on Friday, with little change in equities, and the euro up slightly against the dollar and crude oil prices rising due to fear of supply disruptions over Crimea. Wall Street ends lower as biotechs fall; indexes up for week U.S stocks fell on Friday as investors took profits in momentum stocks, erasing early gains that had previously pushed the S&P 500 to an intraday high. Forex-Dollar rally ends as euro comes off lows A three-day dollar rally ended on Friday as world markets attempted to price in possible shifts in U.S. monetary policy. The euro rose on news of a record monthly euro zone current account surplus. “ECB can still cut interest rates”: Erkki Liikanen The European Central Bank can still cut interest rates further from the current record-low rates, including taking its deposit rate to negative territory, Governing Council member Erkki Liikanen said on Saturday. Possible Stock rally could be halted by Ukraine U.S. stocks still have further upside this week. But this depends on whether investors are anxious over the crisis in Ukraine and signs of weakness in U.S. economy. Investors will also observe signs of poor weather which may continue to weaken economic data and reduce profit outlooks in the short run.

KEY EVENTS LAST WEEK (17th MARCH – 21st MARCH 2014)

Currency Event Actual Forecast

AUD Monetary Policy Meeting Minutes

EUR German ZEW Economic Sentiment 46.6 52.8

CAD Manufacturing Sales m/m 1.50% 1.10%

USD Building Permits 1.02M 0.97M

USD Core CPI m/m 0.10% 0.10%

CAD BOC Gov Poloz Speaks

GBP BOE Gov Carney Speaks

JPY BOJ Gov Kuroda Speaks

GBP Claimant Count Change -34.6K -23.3K

GBP MPC Asset Purchase Facility Votes 0-0-9 0-0-9

GBP MPC Official Bank Rate Votes 0-0-9 0-0-9

GBP Unemployment Rate 7.20% 7.20%

GBP Annual Budget Release

CHF SNB Chairman Jordan Speaks

USD FOMC Economic Projections

USD FOMC Statement

USD FOMC Press Conference

NZD GDP q/q 0.90% 1.00%

JPY BOJ Gov Kuroda Speaks

CHF Libor Rate <0.25% <0.25%

CHF SNB Monetary Policy Assessment

USD Unemployment Claims 320K 327K

USD Existing Home Sales 4.60M 4.65M

USD Philly Fed Manufacturing Index 9 4.2

CAD Core CPI m/m 0.70% 0.50%

CAD Core Retail Sales m/m 1.00% 0.90%

KEY EVENTS THIS WEEK (24th MARCH – 28th MARCH 2014)

Currency Event Singapore Time (+8GMT)

Importance

CNY HSBC Flash Manufacturing PMI Monday 9.45 AM High

EUR French Flash Manufacturing PMI Monday 4.00 PM High

EUR German Flash Manufacturing PMI Monday 4.30PM High

EUR German Ifo Business Climate Tuesday 5.00 PM High

GBP CPI y/y Tuesday 5.30PM High

USD CB Consumer Confidence Tuesday 10.00 PM High

USD New Home Sales Tuesday 10.00 PM High

AUD RBA Gov Stevens Speaks Wednesday 2.00 PM High

USD Core Durable Goods Orders m/m Wednesday 8.30 PM High

NZD Trade Balance Thursday 5.45 AM High

GBP Retail Sales m/m Thursday 5.30 PM High

USD Unemployment Claims Thursday 8.30 PM High

USD Pending Home Sales m/m Thursday 10.00 PM High

GBP Current Account Friday 5.30 PM High

SGX COMPANY EARNINGS RELEASE (CONFIRMED)

Company Date

Pteris 27 March 2014

Neo Group (estimated) 27 March 2014

Innovalues (estimated) 27 March 2014

2ndChance 28 March 2014

Low Keng Huat Singapore (estimated) 28 March 2014

TianJinZ US$ 31 March 2014

Data as at 23/3/14

THIS WEEK’s FUNDAMENTAL ANALYSIS (FA) IDEA 1

Q&M Dental Group (BUY)

Ticker: SGX: QC7 Last Closed Price: 0.40 SGD 12M TP: 0.48 SGD Upside/Downside Potential: 20% COMPANY DESCRIPTION

Q & M Dental Group (Singapore) Limited is a management and consultancy services and investment holding. The Company is a dental healthcare group in Asia. It operates the network of dental outlets in Singapore and is building its presence in the People’s Republic of China (PRC) and Malaysia. It also owns two dental supplies and equipment distribution companies. The Company’s dental healthcare services include Aesthetic Dentistry, CEREC One-Day Crown, Children Dentistry, Consultation, Crowns and Bridges, Dental Laser, Dentures, Galileos 3D Radiography, General Dentistry, Gum Bleeding Treatment, Oral Surgery, Orthodontics (Braces), Treatment for Sensitive Teeth, Wisdom Tooth Surgery and X-Ray and OPG Facilities. On March 12, 2014, the Company's subsidiary, Q & M Dental Holdings (China) Pte, has incorporated a subsidiary namely, Q & M Aidite International Pte Ltd in Singapore.

KEY FIGURES Mkt Cap

242.18 Mil

Issued Capital 605.45 Mil

30 Day Avg Vol 2.4 Mil

Free Float 146.70 Mil

2011 2012 2013 2014F

Net Income (Mil) 4.581 5.001 6.461 7.200

EBITDA 4.4 5.1 8.9 9.6

EPS (cts) 0.757 0.826 1.067 1.200

P/E (x) 52.87 48.43 37.48 30.20

NUS Invest Research Analyst Ang Kar Yong Acquisation and Expansion Plans

Q & M Dental Group (Singapore) has agreed to acquire a 60-percent interest in Nanjing Sucoronal Dentistry Technique Center from Mr Zhang Haiquan for Rmb21 million ($4.4 million). Q & M will receive a profit guarantee of Rmb38.7 million over 12 years starting from 2014.

The Group has built a successful network of dental clinics in Singapore, providing both general practitioner and specialist dental services. The Group has embarked on expanding its dental business overseas and had ventured into 2 countries, namely Malaysia and People’s Republic of China (“PRC”).

In PRC to-date, the Group had entered into joint ventures with three (3) dental groups located in Beijing, Nanjing and Shenyang and had also acquired two (2) dental clinics in Shanghai.

The Proposed Acquisition is in line with the Group’s expansion plans into PRC. The Group intends to achieve a bigger market share of the dental business in PRC through joint ventures with suitable partners.

Acquisition of foo & associates Pte Ltd

Q&M Dental picks up Orchard Road dental clinic for $5.5m. The Proposed Acquisition is in line with the Company’s plans to continue the expansion of its main dental business in Singapore. This Proposed Acquisition will allow the Company to add a fully operational clinic located in a prime location in Singapore. The Company intends to work with Dr Foo Mooh Thong, an expert in the Computer Aided Design / Computer Aided Milling technology and intends to have Dr Foo Mooh Thong spearhead the Company’s expansion into this field.

Q & M Dental Group (Singapore) Ltd revenues grew 24.74% from 57.04m to 71.15m while net income improved 29.19% from 5.00m to 6.46m. Both dividends per share and earnings per share increased 92.59% and 17.20% respectively. The positive trend in dividend payments is noteworthy since very few companies in the Healthcare Facilities industry pay dividend. Additionally when measured on a five year annualized basis, dividend per share growth ranked highest relative to its industry peers, while earnings per share growth is in-line with the industry average.

In 2013, Q & M Dental Group (Singapore) Ltd increased its cash reserves by 55.51%, (10.26m). Cash Flow from Financing totaled 13.60% (9.68m) of revenues. In addition the company generated 4.23m in cash from operations while 3.64m cash is used for investing. Q & M Dental Group (Singapore) Ltd appears to have a strong balance sheet with enough cash in the capital structure to pay down 100% of the liabilities.

MARKET POTENTIAL For now, most dental spending occurs in developed countries, especially Europe and North America. Dental health is not yet seen as a priority for those in less economically developed parts of the world. But with China approaching middle-income status, and the Indian middle class expanding greatly, demand for dental services is set to explode in both countries.

China’s development has changed, and will continue to change its oral health environment. People are more aware of the importance of oral health and are more willing to spend time and money on fixing their teeth. The Chinese dental market has gigantic potential.

One major opportunity lies in the provision of high-quality dental care. Chinese dental hospitals are usually overcrowded and impersonal, while existing private clinics lack privacy and care standards are variable. A significant number of dentists still work out of open-air market stalls, with predictably dire implications for basic hygiene. In China, companies are dominating this trend with experience running clinics in other countries, such as Q&M Dental Group.

CONCLUSION With all the acquisition and expansion plans that Q&M Dental Group (Singapore) Ltd has, supported with its positive key financial figures and market potential, we are generally optimistic on Q&M Dental Group.

Div Yield (%) 1.534 1.534 3.250 3.200

ROE (%) 16.8 17.3 14.0 15.9 Payout ratio (%) 0.813 0.742 1.215

Acquisition Of Block 130 Jurong Gateway Road

The Acquisition is a strategic opportunity to enable the Group to add another permanent location for the operation of a dental centre in the vibrant Jurong East Central, 1 of the 4 regional centres in Singapore.

Acquisition Of 70% Shareholding In Ng Gk Dental Surgery (Melaka) Sdn Bhd

The Proposed Acquisition is in line with the Group’s expansion plans into Malaysia. The Company intends to achieve a bigger market share of the dental business in Malaysia through organic growth or through joint ventures with third parties. This is the first clinic being acquired by the Group in Melaka, Malaysia and this Proposed Acquisition will enable the Group to tap into the Melaka dental tourism market.

Key Risks

Investment risks include loss of key dentists, failure to renew existing leases for the dental clinics, stiff competition in the local dental healthcare, complaints or medical negligence, foreign exchange fluctuations and global economic downturn, which would hurt demand for its dental services.

THIS WEEK’S FUNDAMENTAL ANALYSIS (FA) IDEA 2

TESLA MOTORS, INC (BUY)

Ticker: NASDAQ : TSLA Last Closed Price (USD): $228.89 12M TP (USD): $264.95 Upside Potential: 15.7%

COMPANY DESCRIPTION

Tesla Motors, Inc. is an American company that designs, manufactures and sells electric cars and electric vehicle powertrain components. Tesla also markets electric powertrain components, including lithium-ion battery packs, to automakers, including Daimler and Toyota. Tesla's CEO, Elon Musk, has said he envisions Tesla as an independent automaker, aimed at eventually offering electric cars at a price affordable to the average consumer.

CONCLUSION

Tesla has fast become a recognized brand name as an electric carmaker and is on track to achieve so much more. For a company that has only recently turned profitable, its share price has gone from $17.00 at IPO to peak at $236.20 in less than 4 years. With many more models in the pipeline, a vast supercharger network that is set to grow, and new markets being tapped, Tesla has great potential, and is poised to dominate the electric car market in the US and maybe even globally. With its SuperCharger technology and network, Tesla already has an advantage. What may seem like an overvalued stock at this point may just turn out to be very profitable because of one very

KEY FIGURES (USD m) Mkt Cap (m) 28,197.40

123.19 65.0%

10,134.31

Issued Capital (m) Free Float (%) Avg Daily Vol (3 mths)

FY Ending Dec 2011 2012 2013 2014F Revenue (m) 204 413 2,013 3,632 EBITDA (m) -234.6 -365.5 44.8 11.44 Net Income (m) -254 -369 -74 229 Basic EPS (cents) -2.53 -3.69 -0.62 1.68 P/E (x) - - - 136.57 ROE (%) -117.20 -224.93 -17.26 36.11

NUS Invest Research Analyst Steven Peeris

Growth Potential

Profit Beat Estimates

Tesla’s 2013 Q4 Profit beat analyst estimates at 33 cents a share when analyst averages were just 26 cents a share. Profit for Q4 2013 was $46 Million. A good showing for Tesla which was mostly unprofitable before Q4 2013.

Growing Order Book

Tesla delivered only 6,892 cars in 2013. 2014 estimates look very upbeat however, with an estimated 35,000 cars forecasted for 2014. Tesla’s flagship model, the luxury model S was the best-selling car in North America among comparably priced cars. Tesla is expected to start shipping to China in March 2014, and will soon be shipping to Europe and Japan.

Trump Card – The Supercharger Network

Tesla’s trump card, and wave of the future is its Supercharger network. Capable of recharging a Tesla Model S in just over an hour, each station’s charging capability is unlike any other in the world. The next major milestone for Tesla is that it recently completed the “Coast to coast Corridor”, with charging stations along major highways, owners of the Tesla Model S can essentially drive from east coast to the west coast of the US for free. Tesla also has the “West Coast Corridor” which allows owners to drive from California to Vancouver in Canada for free. Tesla already has a small charging network in Europe that is already expanding.

Plans For A New “Giga Factory”

Tesla has revealed plans to build a new giga factory to facilitate expansion. The new factory is expected to build batteries and next generation models from Tesla.

Clearing Legal Obstacles

Tesla is obtaining the right to sell its cars without using US dealership networks and has already done so in some states. This cuts out the middle man in its distribution channel and enables it to sell direct to customers which saves distribution costs and allows Tesla its own form of marketing.

important point to note. Tesla still has its innovator, Elon Musk, and he has the vision and prowess to take the company to heights never before seen. I recommend a Buy call for Tesla, and a minimum hold period of at least 1 year for short-term investors and 5 years or more for longer-term investors.

THIS WEEK’s TECHNICAL ANALYSIS (TA) TRADE IDEA 1

VARD Holding (Long) Current Price: SGD $1.02 Suggested Take Profit: SGD $1.05 OR $1.19 Suggested Stop Loss: SGD $0.99 Risk-Reward Ratio: 1:1 OR 1:5.6

NUS Invest Analyst Justin Yeo

Bullish technical signs spotted: 1. Closing of gap down at late June 2013 2. Double bottom with breakout confirmation

Currently, PE stands at 16.2 and 1.56 multiple of its NAV. Market capitalisation is 1.2b. It has 10

shipyards around the world (5 in Norway, 2 in Romania, 1 in Vietnam, 2 in Brazil). It is a major

European global designer and shipbuilders of offshore and specialised vessels. Used to be called STX

OSV before late 2013, its renamed to VARD holdings because of a buyout offer at SGD $1.22

(discount to current price of $1.40) per share from Italian state-owned shipbuilder Fincantieri Oil and

Gas. This caused the downtrend in 2013.

However, it shows signs of reversal starting 2014. Recently it has secured contracts for 2 offshore

support vessels valued at NOK600m and to be delivered between Q3 and Q4 of 2015 from its

Romania branch called Vard Bralia. Another is a contract for 2 platform supply vessels for Mermaid

Marine Australia, the largest marine service provider to offshore oil and gas in Australia. This is their

first corporation and will be expected to deliver from Vard Vung Tau Vietnam between 4Q and 1Q

2015. These 2 separate contracts are secured after it made the strongest full year 2013 order intake

of NOK 14.2b (2.99b SGD) since its record high in 2008 at 19.4b. During 2013, VARD has successfully

delivered 22 projects across its European, Vietnam and Brazil yards. However, it has 4 delayed

projects all coming from Brazil Niteroi.

1

2

Unattractive offer from

Fincantieri Oil and Gas at 1.22

when current price at 1.40

1.22

1.40

Breakout confirmation

What stands for Vard in the future? Cause of weak performance in 2013 is overloading of OSV

construction at Vard Niteroi in Brazil and its solution to this is to build a second yard in Brazil called

Vard Promar. Vard Promar is largely completed and its operations are being ramped up to meet

necessary production volume. Brazil demand for oil is increasing because of a the strengthening

consumer sector. Moreover, most countries are dependent on oil and standoff in Ukraine might be a

factor to meet this need independently. In 2013, Europe receive over a third of its net crude import

from Russia, and Russia relied on Europe for 71% of its crude export.

THIS WEEK’s TECHNICAL ANALYSIS (TA) TRADE IDEA 2

Forex (FX): EURUSD (SHORT) Current Price: 1.37921 Suggested Take Profit (conservative): 1.36848 Suggested Take Profit (aggressive): 1.36389 Suggested Stop Loss: 1.38912 Risk-Reward Ratio: 1:1.5

NUS Invest Analyst Lester Koh

Daily Charts

The Hanging man candle pattern marks the end of a 12 month Elliot-Wave 5 Cycle, with plenty of confirmation as seen by the bearish engulfing pattern 4 candles after the Hanging Man and the beginning of a downtrend.

References: http://sbr.com.sg/shipping-marine/news/singapore-offshore-vessel-builders-becoming-sandwiched-in-yard-competition http://www.offshoreenergytoday.com/italys-fincantieri-to-splash-usd-1-2-bln-on-stx-osv-acquisition/ http://vard.listedcompany.com/news.html/id/394067 http://oilinvestingnews.com/10359-oil-outlook-oil-demand-set-to-grow-in-2014.html http://news.xin.msn.com/en/world/oil-demand-to-rise-in-2014-on-improving-economy-energy-body-says

Prices have cut below the Tenken and Kijun Lines, indicating an early, aggressive confirmation of a change in short term trend. Prices may take support at the cloud, which would be our conservative target price.

Prices have also cut below parabolic SAR and 25 day moving average, indicating a possible confirmation of a downtrend.

Prices have failed to break out after a 4 days test of the resistance (A). It broke short term support at (B), and finally, broke downwards of the 2 month support at C. This further confirms the downtrend although we might want to monitor the support levels at B and C.

Taking all these factors into consideration, we derive a short trade at current price with an aggressiveness score of 64.7%, indicating that this is a rather early and aggressive entry, and we would be looking for more confirmation signals and confluences as the trade progresses. We also derive 2 profit targets: a conservative price target of 1.36848 which is derived from the Ichimoku cloud, as well as a more aggressive price target of 1.36389 which is the previous low. Considering the aggressiveness score of the trade, we might want to take profit at the conservative price target unless further confirmation signs appear. Additionally, we estimate a time target of 9 to 17 trading days for our aggressive target price of 1.36389 and 7-12 trading days for our conservative target price estimated based on past downtrend runs. Finally, based on the aggressive target price of 1.36389 and stop loss of 1.38912, we have a risk-reward ratio of 1.5

THIS WEEK’s TECHNICAL ANALYSIS (TA) TRADE IDEA 3

Forex (FX): GBPJPY (SHORT) Current Price: 168.551 Suggested Entry: 171.179 Suggested Take Profit: 169.812 Suggested Stop Loss: 171.660 Risk-Reward Ratio: 1:2.84

NUS Invest Analyst Lester Koh

4-Hourly Chart

We observe a potential bearish bat pattern on the hourly GBPJPY chart, with a potential reversal zone at the price range of 170.917 to 171.179. We suggest an entry at the upper range of the price reversal zone of 171.179 and a stop loss at 171.660, which is slightly above the X point of the pattern as well as a key resistance level. Our target price is derived from a potential 61.8% retracement of the CD wave, which gives us a risk-reward ratio of 2.84.

Key risks of course would include invalidation of the bearish bat pattern which would render the entry void, as well as a breakout beyond the price reversal zone.

SUMMARY OF TRADES TO DATE

Instrument Entry (L/S)*

Target Stop Analysis By

Date of Analysis

AUDUSD (FX) L 0.9272 0.9212 Steven 15/9/13

EURUSD (FX) S 1.3240 1.3465 Kar Yong 15/9/13

Kreuz Holdings (Equity) L 0.78 0.77 Yong Kin 22/9/13

Cosco Corp. (Equity) S 0.815 0.85 Ruwei 22/9/13

Mapletree Commercial Trust (Equity)

L 1.42 1.10 JieJi 6/10/13

ComfortDelgro (Equity) S 1.855 1.965 Wei Hong 6/10/13

GBPUSD (FX) S 1.57106 1.60000 Nicholas 13/10/13

THBEV (Equity) L 0.550 0.510 Stephen 13/10/13

Hafary Holdings (Equity) L 0.38 N/A Lester 20/10/13

AUDUSD (FX) S 0.9620 0.9700 Steven 20/10/13

NZDUSD (FX) S 0.8400 0.8530 Kar Yong 20/10/13

Genting SP (Equity) S 1.495 1.54 Yong Kin 26/10/13

OSIM (Equity) S 2.13 2.18 Ruwei 26/10/13

CapitaCommercial Trust L $1.55 $1.32 Jie Ji 1/11/13

Mapletree GCC Trust L $0.96 $0.910 Wei Hong 1/11/13

KepLand (Equity) S $3.09 $3.40 Jie Ji 11/1/13

CoscoCorp (Equity) L $0.865 $0.685 Wei Hong 11/1/13

City Development (Equity) S $8.50 $9.76 Ruwei 26/1/14

Noble Group (Equity) S $0.905 $0.985 Yong Kin 26/1/14

SolarWinds Inc (Equity) L $51.40 $40.05 Jie Ji 9/2/14

EURGBP (FX) S 0.8250 0.8331 Wei Hong 9/2/14

Singapore Airlines (Equity) L $10.45 $10.05 Jie Ji 15/3/14

EURJPY (FX) L 143.410 138.458 Wei Hong 15/3/14

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©2013 NUS Invest

*L/S Denotes Long/Short Entries