India Life Insurance

Asia Pacific Equity Research 02 July 2008

India Life Insurance Insurance Tracker - May 2008 • Private growth continues, LIC loses share: New business premiums (APE) for the industry rose 20% yoy in May08 boosted by 72% yoy growth for private vs. 19% yoy decline for LIC. • LIC’s market share shrank to 38% in May-08. Although LIC’s APE declined 19% yoy in May, individual APE declined even more at 22% only to be partly compensated by higher group APE, up 77%. • SBI, Birla and Reliance continue to garner maximum gains within the private space. ICICI maintains share.

India Insurance - Life Sachin ShethAC (91-22) 6639-3004 [email protected] J.P. Morgan India Private Limited

Nitin Kumar (91-22) 6639-3003 [email protected] J.P. Morgan India Private Limited

Sunil Garg

• LIC continued to lag on volume growth with 21% fewer policies

sold in May08; However, premium per policy increased marginally by 3% leading to 19% decline in APE growth.

(852) 2800-8518 [email protected] J.P. Morgan Securities (Asia Pacific) Limited

• News: HSBC makes an entry in the life business in a JV with

Canara and Oriental Bank. Figure 1: FY09 growth in new business premium (APE) – May 2008 (growth numbers are for the month of May) 500%

209%

200% 100%

176%

145%

132%

115%

72%

91%

80%

75%

70%

Met Life

300%

ICICI Prudential

936%

844%

400%

20%

33%

0%

YoY Grow th in NBP(APE)

ING Vysya

Tata AIG

Sahara Life

Kotak Mahindra Old Mutual

Max New York

SBI Life

Reliance Life

Birla Sunlife

Bharti Axa Life

Total Private

Total Industry

LIC

-19%

-100%

FY09 Ytd Grow th in NBP(APE)

Source: IRDA, JPMorgan

www.morganmarkets.com

See page 15 for analyst certification and important disclosures, including non-US analyst disclosures. JPMorgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Figure 2: Industry : Growth in New Business Premium (Unweighted)

Figure 3: LIC : Growth in New Business Premium (Unweighted) 500%

400% 350% 300% 250% 200% 150% 100% 50% 0% -50% -100%

400% 300% 200% 100%

F2007

F2008

F2009

Source: IRDA, JPMorgan.

Source: IRDA, JPMorgan.

Figure 4: Private Players : Growth in New Business Premium (Unweighted)

Figure 5: ICICI Prudential : Growth in New Business Premium (Unweighted)

180%

250%

160%

200%

140%

150%

120% 100%

100%

May'08 : 69%

80%

50%

60%

0%

40%

May'08 : 68%

Source: IRDA, JPMorgan.

F2009

F2007

Source: IRDA, JPMorgan.

F2008

F2009

Mar

Feb

Jan

Dec

Nov

Oct

Sep

Aug

Jul

Mar

Feb

Jan

Dec

Nov

Oct

Aug

Sep

F2008

Jun

Apr

F2007

Jul

Jun

May

Apr

0%

May

-50%

20%

2

Mar

Feb

Jan

Dec

Nov

Oct

Sep

Aug

Jul

Jun

F2009

May

Mar

Feb

Jan

Dec

Nov

F2008

May'08 : 0%

-100% Apr

F2007

Oct

Sep

Aug

0% Jul

Jun

May

Apr

May'08 : 23%

Asia Pacific Equity Research 02 July 2008

Figure 6: Bajaj Allianz : Growth in New Business Premium (Unweighted)

Figure 7: SBI Life : Growth in New Business Premium (Unweighted) 700%

F2007

F2008

May'08 : 109%

F2009

F2007

F2008

F2009

Source: IRDA, JPMorgan.

Source: IRDA, JPMorgan.

Figure 8: HDFC SL : Growth in New Business Premium (Unweighted)

Figure 9: BSLI : Growth in New Business Premium (Unweighted)

160%

Mar

Feb

Jan

Dec

Nov

Oct

Sep

Aug

Jul

Jun

0% Apr

Mar

Feb

Jun

May'08 : 5% 51%

May

Apr

-50%

Jan

100% Dec

200%

0% Nov

300%

50%

Oct

400%

100%

Sep

500%

150%

Aug

600%

200%

Jul

250%

May

Sachin Sheth (91-22) 6639-3004 [email protected]

250%

140%

200%

120%

May'08 : 200% 150%

100% 80%

100%

60%

50%

40% 20%

0%

F2007

Source: IRDA, JPMorgan.

F2008

F2009

F2007

F2008

Mar

Feb

Jan

Dec

Nov

Oct

Sep

Aug

Jul

Jun

May

-50% Apr

Mar

Feb

Jan

Dec

Nov

Oct

Sep

Aug

Jul

May

Apr

Jun

May'08 : 10%

0%

F2009

Source: IRDA, JPMorgan.

3

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Table 1: New Business Premium, Monthly and F2009 Ytd growth (sorted on APE Growth F2009 Ytd) Life Insurer Grand Total LIC Total Private Bharti Axa Life Birla Sunlife Reliance Life Met Life SBI Life Max New York Sahara Life Kotak Mahindra Old Mutual Tata AIG ICICI Prudential Shriram Life ING Vysya HDFC Standard Bajaj Allianz Aviva

APE Growth May 08

APE Growth F2009 Ytd

20% -19% 72% 844% 209% 176% 70% 145% 132% 91% 115% 80% 75% -16% 33% 6% 6% 23%

12% -29% 74% 936% 218% 201% 148% 137% 108% 107% 106% 97% 57% 51% 34% 22% 20% 18%

Unweighted Growth May 08 23% 0% 69% 872% 200% 196% 57% 109% 120% 92% 110% 72% 68% 29% 40% 10% 5% 23%

Unweighted Growth F2009 Ytd 11% -17% 73% 996% 208% 256% 132% 103% 99% 113% 101% 88% 50% 119% 40% 29% 19% 17%

Source: IRDA, JPMorgan;

Table 2: Total Single Premium as a proportion of Total Unweighted Premium, F2009 Ytd (sorted on F2009 Ytd) Life Insurer Grand Total LIC Total Private Shriram Life IDBI Fortis Life** Sahara Life Reliance Life SBI Life Max New York HDFC Standard ICICI Prudential ING Vysya Tata AIG Bharti Axa Life Bajaj Allianz Kotak Mahindra Old Mutual Aviva Met Life Birla Sunlife Future Generali * Source: IRDA, JPMorgan;

4

May 08 38% 60% 12% 65% 59% 32% 27% 20% 14% 10% 7% 10% 10% 6% 9% 5% 3% 3% 3% 0%

F2009 Ytd 35% 54% 14% 61% 60% 33% 32% 23% 14% 14% 11% 10% 10% 8% 8% 5% 3% 2% 2% 0%

Asia Pacific Equity Research 02 July 2008

Figure 10: Trend in New Business Premium (unweighted) Rs billion 160 140 120 100 80 60 40 20

NBP - LIC

Apr-08

Jan-08

Oct-07

Jul-07

Apr-07

Jan-07

Oct-06

Jul-06

Apr-06

Jan-06

Oct-05

Jul-05

Apr-05

Jan-05

Oct-04

Jul-04

0 Apr-04

Sachin Sheth (91-22) 6639-3004 [email protected]

NBP - Priv ate

Source: IRDA, JPMorgan *unweighted as data for single premium is not available prior to Feb06

Table 3: Life Insurance - Market Share (APE) for May 2008 Life Insurer LIC Private ICICI Prudential SBI Life Bajaj Allianz Max New York Birla Sunlife HDFC Standard Reliance Life Kotak Mahindra Old Mutual Tata AIG Aviva Met Life ING Vysya Bharti Axa Life Shriram Life Sahara Life IDBI Fortis Life Future Generali

Market Share (APE basis) 38.4% 61.6% 16.3% 8.8% 7.8% 4.8% 4.7% 4.3% 4.3% 2.4% 2.3% 1.8% 1.5% 1.4% 0.4% 0.3% 0.2% 0.1% 0.0%

Change yoy -18.37% 18.37% 5.09% 4.47% -1.08% 2.32% 2.86% -0.58% 2.41% 1.04% 0.77% 0.05% 0.44% 0.13% 0.36% -0.14% 0.07% 0.13% 0.03%

Share of Private

Change yoy

26.5% 14.3% 12.7% 7.8% 7.6% 7.0% 6.9% 3.8% 3.8% 2.9% 2.5% 2.3% 0.7% 0.5% 0.3% 0.2% 0.0%

0.5% 4.3% -7.9% 2.0% 3.4% -4.3% 2.6% 0.8% 0.2% -1.1% 0.0% -0.7% 0.5% -0.5% 0.0% 0.2% 0.0%

Source: IRDA, JPMorgan.

5

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Table 4: Life Insurance - Market Share (APE) for F2009 Ytd Life Insurer LIC Private ICICI Prudential Bajaj Allianz SBI Life Max New York Birla Sunlife Reliance Life HDFC Standard Tata AIG lotal Mahindra Old Mutual Met Life Aviva ING Vysya Shriram Life Bharti Axa Life Sahara Life IDBI Fortis Life** Future Generali

Market Share (APE basis) 38.2% 61.8% 15.4% 8.1% 7.8% 4.9% 4.6% 4.5% 4.5% 3.1% 2.3% 2.2% 1.9% 1.4% 0.5% 0.4% 0.2% 0.1% 0.0%

Change yoy -22.1% 22.1% 4.4% 0.5% 4.1% 2.2% 3.0% 2.8% 0.3% 1.3% 1.1% 1.2% 0.1% 0.2% 0.1% 0.4% 0.1% 0.1% 0.0%

Share of Private

Change yoy

24.9% 13.1% 12.6% 7.9% 7.4% 7.3% 7.3% 5.0% 3.8% 3.5% 3.0% 2.2% 0.7% 0.7% 0.3% 0.2% 0.0%

-2.7% -5.9% 3.3% 1.3% 3.3% 3.1% -3.2% 0.6% 0.6% 1.1% -1.4% -0.7% -0.1% 0.6% 0.0% 0.2% 0.0%

Figure 11: Market share trends (APE basis) - LIC vs. Private

LIC

Source: IRDA, JPMorgan

6

Private

Apr-08

Feb-08

Dec-07

Oct-07

Aug-07

Jun-07

Apr-07

Feb-07

Dec-06

Oct-06

Aug-06

Jun-06

Apr-06

Feb-06

90% 80% 70% 60% 50% 40% 30% 20% 10%

Asia Pacific Equity Research 02 July 2008

Figure 12: Market share trend of selected private players (APE) 40%

ICICI Prudential

35%

SBI Life

30%

Bajaj Allianz

25% 20%

Max New York

15%

Birla Sunlife

10%

HDFC Standard

5%

Reliance Life

Apr-08

Feb-08

Dec-07

Oct-07

Aug-07

Jun-07

Apr-07

Feb-07

Dec-06

Oct-06

Jun-06

Aug-06

Apr-06

Feb-06

0% Kotak Mahindra Old Mutual

Source: IRDA, JPMorgan.

Figure 13: Trend in APE, no. of policies and avg. premium per policy for LIC 14,000,000

60,000

12,000,000

50,000

10,000,000

40,000

8,000,000 30,000 6,000,000 20,000

4,000,000

10,000

2,000,000

No of policies (mn)

Value per policy (Rs)

Apr-08

Feb-08

Dec-07

Oct-07

Aug-07

Jun-07

Apr-07

Feb-07

Dec-06

Oct-06

Aug-06

Jun-06

Apr-06

Feb-06

-

APE (Rs mn)

Source: IRDA, JPMorgan.

Figure 14: Trend in APE, no. of policies and avg. premium per policy for Private Players 2,500,000

70,000 60,000

2,000,000

50,000 1,500,000

40,000 30,000

1,000,000

20,000 500,000

10,000

No of policies (mn)

Value per policy (Rs)

Apr-08

Feb-08

Dec-07

Oct-07

Aug-07

Jun-07

Apr-07

Feb-07

Dec-06

Oct-06

Aug-06

Jun-06

Apr-06

Feb-06

Sachin Sheth (91-22) 6639-3004 [email protected]

APE (Rs mn)

Source: IRDA, JPMorgan

7

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Table 5: Life Insurance: Average premium per policy, LIC vs. Private, May 2008 No. of policies sold ('000) May 08 LIC YoY LIC Share Private YoY Private Share

1,662 -21% 63% 965 43% 37%

No. of policies sold ('000) F2009 Ytd 2,739

Premium per policy (Rs) May 08

Premium per policy (Rs) F2009 Ytd

May 08 APE (Rs mn)

8,083 3%

7760

13,433 -19% 38%

22,321 20%

20357

21,542 72% 62%

62% 1,692 38%

Source: IRDA, JPMorgan.

Table 6: Total Individual APE, Monthly and F2009 Ytd growth (sorted on Monthly Growth) Life insurer Grand Total LIC Total Private Bharti Axa Life Birla Sunlife Reliance Life Max New York Kotak Mahindra Old Mutual Sahara Life SBI Life Tata AIG Met Life ICICI Prudential ING Vysya Aviva HDFC Standard Bajaj Allianz Shriram Life

May-08 14% -22% 64% 842% 254% 182% 130% 121% 91% 85% 84% 70% 60% 35% 26% 16% 2% -16%

F2009 Ytd 8% -31% 71% 932% 254% 206% 101% 111% 107% 94% 83% 149% 54% 35% 19% 33% 18% 51%

Source: IRDA, JPMorgan

Table 7: Total Group APE, Monthly and F2009 Ytd growth (sorted on Monthly Growth) Life insurer Grand Total LIC Total Private SBI Life Bajaj Allianz Max New York ICICI Prudential Kotak Mahindra Old Mutual Met Life Tata AIG Reliance Life HDFC Standard ING Vysya Aviva Birla Sunlife Source: IRDA, JPMorgan

8

May-08 127% 77% 154% 344% 325% 222% 178% 17% 17% 13% -23% -65% -67% -78% -84%

F2009 Ytd 78% 21% 108% 332% 255% 502% 73% 36% 25% 295% 66% -65% -34% -8% -37%

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Table 8: Total Individual Premium as a proportion of Total APE, Monthly and F2009 Ytd (sorted on monthly basis ) Life insurer Grand Total LIC Total Private Shriram Life IDBI Fortis Life** Sahara Life Bharti Axa Life Met Life ING Vysya Aviva Birla Sunlife Reliance Life Max New York Kotak Mahindra Old Mutual Tata AIG HDFC Standard Bajaj Allianz ICICI Prudential Future Generali * SBI Life

May-08 89.2% 92.4% 87.2% 100.0% 100.0% 100.0% 99.8% 99.8% 99.5% 99.5% 99.3% 99.2% 96.9% 96.7% 95.8% 95.8% 95.7% 80.1% 61.4% 57.8%

F2009 Ytd 91.2% 94.5% 89.1% 100.0% 100.0% 100.0% 99.6% 99.8% 99.3% 96.3% 97.6% 98.0% 95.2% 95.0% 87.4% 96.6% 97.2% 82.1% 40.8% 67.3%

Source: IRDA, JPMorgan

Table 9: Monthly Contribution to Full Year APE, F2008 April May June July August September October November December January February March Total

Total 3.6% 5.2% 6.0% 7.2% 9.9% 6.3% 5.6% 6.8% 9.4% 10.8% 9.7% 19.6% 100%

LIC 4.9% 6.1% 7.1% 9.3% 14.1% 4.4% 4.3% 6.0% 7.7% 11.0% 7.9% 17.2% 100%

Private 2.5% 4.3% 4.9% 5.2% 6.0% 8.0% 6.7% 7.5% 11.0% 10.6% 11.4% 21.9% 100%

Source: IRDA, JPMorgan.

9

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Table 10: Market Share, F2008 Life Insurer Total LIC Private ICICI Prudential Bajaj Allianz SBI Life HDFC Standard Reliance Life Birla Sunlife Max New York Kotak Mahindra Old Mutual Aviva Tata AIG Met Life ING Vysya Shriram Life Bharti Axa Life Sahara Life IDBI Fortis Life** Future Generali * Source: IRDA, JPMorgan.

10

Market Share (APE basis) 100% 48.1% 51.9% 13.7% 10.3% 6.2% 4.1% 3.4% 3.4% 2.4% 1.9% 1.8% 1.5% 1.4% 1.2% 0.3% 0.2% 0.1% 0.0% 0.0%

YoY growth in APE 31% 0% 84% 70% 82% 93% 75% 168% 130% 74% 88% 50% 51% 133% 50% 49% 1270% 234% NM NM

Share of Private

26.3% 19.9% 11.9% 7.9% 6.6% 6.6% 4.6% 3.6% 3.5% 3.0% 2.6% 2.3% 0.5% 0.4% 0.3% 0.0% 0.0%

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Sector News HSBC launches insurance JV with CanBank, Oriental Bank (June 17–ET) Top HSBC sees great potential for its insurance products in the fast-growing economies of China and India as part of a global push to boost its insurance business. Europe's biggest bank on Monday launched its life insurance joint venture in India, a market where it will face stiff competition from state-run Life Insurance Corp and a host of ventures of the world's top insurance companies including AIG, Allianz and Aviva. Thomas Cook ties up with Bajaj Allianz (June 13 – ET) Top In order to attract more footfalls in its offices across the country, travel solutions provider Thomas Cook (India) on Thursday entered into an corporate agency agreement with Bajaj Allianz Life Insurance (BALI). Thomas Cook (India) has already tie-ups with Tata AIG for selling general insurance products and with ICICI Bank for credit cards. UCO Bank set to form Non-life JV with Liberty (June 9 – ET) Top UCO Bank has decided to enter into a joint venture agreement with the US-based Liberty to foray into non-life insurance business during the current financial year. After deciding to enter the non-life insurance business, the bank was in talks with several foreign players like the Liberty of US, Engine of Italy and a few other Japanese firms for roping in a foreign partner as per IRDA regulations. While UCO would have a minimum stake of 30 % in the JV, there would be another nationalized bank as a partner in the joint venture. The foreign company would hold 26 % as per regulatory norms.

11

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Appendix I: Figure 15: 10 year bond yields 9.0 8.5 8.0 7.5 7.0 6.5 6.0 5.5 5.0

Source: Bloomberg

12

Apr-08

Jan-08

Jul-07

Oct-07

Apr-07

Jan-07

Jul-06

Oct-06

Apr-06

Jan-06

Jul-05

Oct-05

Apr-05

Oct-04

Jan-05

Jul-04

Apr-04

Oct-03

Jan-04

Jul-03

Apr-03

Jan-03

4.5

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Price Performance Charts (From Jan 07) Figure 16: HDFC

Figure 17: SBI

3100

2450

2800

2250 2050

2500

1850

2200

1650

1900

Source: Bloomberg

Source: Bloomberg

Figure 18: ICICI Bank

Figure 19: Bajaj Auto / Bajaj Finserv

May-08

Mar-08

Jan-08

Nov-07

Sep-07

Jul-07

May-07

Jan-07

May-08

Mar-08

Jan-08

Nov-07

Sep-07

Jul-07

May-07

850 Mar-07

1050

1000 Jan-07

1250

1300

Mar-07

1450

1600

1500 3000

1400 1300

2500

1200 1100

2000

1000 900

1500

800 700

Bajaj Finserv , listed on 26th May '08

1000

600 500

Source: Bloomberg

May-08

Mar-08

Jan-08

Nov-07

Sep-07

Jul-07

May-07

Mar-07

Jan-07

May-08

Mar-08

Jan-08

Nov-07

Sep-07

Jul-07

May-07

Mar-07

Jan-07

500

Source: Bloomberg

13

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Price Performance Charts (From Jan 07) Figure 20: ABNL

Figure 21: Reliance Capital

2500

3000

2300

2750 2500

2100

2250

1900

2000

1700

1750

1500

1500 1250

1300

Jan-08

Mar-08

May-08

Jan-08

Mar-08

May-08

300

1450 1350 1250 1150 1050 950 850 750 650 550 450 350

250

200

150

Source: Bloomberg

Jul-07

May-07

Mar-07

Jan-07

May-08

Mar-08

Jan-08

Nov-07

Sep-07

Jul-07

May-07

Mar-07

Jan-07

100

Source: Bloomberg

14

Nov-07

Figure 23: Max India

Nov-07

Figure 22: Kotak Mahindra Bank

Sep-07

Source: Bloomberg

Sep-07

Source: Bloomberg

Jul-07

May-07

Jan-07

May-08

Mar-08

Jan-08

Nov-07

Sep-07

Jul-07

May-07

Mar-07

500

Jan-07

750

900

Mar-07

1000

1100

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

Analyst Certification: The research analyst(s) denoted by an “AC” on the cover of this report certifies (or, where multiple research analysts are primarily responsible for this report, the research analyst denoted by an “AC” on the cover or within the document individually certifies, with respect to each security or issuer that the research analyst covers in this research) that: (1) all of the views expressed in this report accurately reflect his or her personal views about any and all of the subject securities or issuers; and (2) no part of any of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed by the research analyst(s) in this report.

Important Disclosures Explanation of Equity Research Ratings and Analyst(s) Coverage Universe: JPMorgan uses the following rating system: Overweight [Over the next six to twelve months, we expect this stock will outperform the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Neutral [Over the next six to twelve months, we expect this stock will perform in line with the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Underweight [Over the next six to twelve months, we expect this stock will underperform the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] The analyst or analyst’s team’s coverage universe is the sector and/or country shown on the cover of each publication. See below for the specific stocks in the certifying analyst(s) coverage universe.

Coverage Universe: Sachin Sheth: Allahabad Bank (ALBK.BO), Axis Bank Ltd (AXBK.BO), Bank of Baroda (BOB.BO), Bank of India (BOI.BO), Canara Bank (CNBK.BO), Centurion Bank of Punjab (CENB.BO), Development Credit Bank (DCBA.BO), HDFC (Housing Development Finance Corporation) (HDFC.BO), HDFC Bank (HDBK.BO), ICICI Bank (ICBK.BO), Indian Overseas Bank (IOBK.BO), Infrastructure Development Finance Company (IDFC.BO), Karnataka Bank (KBNK.BO), Punjab National Bank (PNBK.BO), State Bank of India (SBI.BO), Syndicate Bank (SBNK.BO), Union Bank of India (UNBK.BO), YES Bank Ltd (YESB.BO) JPMorgan Equity Research Ratings Distribution, as of June 30, 2008

JPM Global Equity Research Coverage IB clients* JPMSI Equity Research Coverage IB clients*

Overweight (buy) 45% 51% 41% 75%

Neutral (hold) 42% 52% 48% 70%

Underweight (sell) 14% 41% 11% 60%

*Percentage of investment banking clients in each rating category. For purposes only of NASD/NYSE ratings distribution rules, our Overweight rating falls into a buy rating category; our Neutral rating falls into a hold rating category; and our Underweight rating falls into a sell rating category.

Valuation and Risks: Please see the most recent company-specific research report for an analysis of valuation methodology and risks on any securities recommended herein. Research is available at http://www.morganmarkets.com , or you can contact the analyst named on the front of this note or your JPMorgan representative. Analysts’ Compensation: The equity research analysts responsible for the preparation of this report receive compensation based upon various factors, including the quality and accuracy of research, client feedback, competitive factors, and overall firm revenues, which include revenues from, among other business units, Institutional Equities and Investment Banking. Registration of non-US Analysts: Unless otherwise noted, the non-US analysts listed on the front of this report are employees of non-US affiliates of JPMSI, are not registered/qualified as research analysts under NASD/NYSE rules, may not be associated persons of JPMSI, and may not be subject to NASD Rule 2711 and NYSE Rule 472 restrictions on communications with covered companies, public appearances, and trading securities held by a research analyst account.

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15

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Asia Pacific Equity Research 02 July 2008

Standardized Options, please contact your JPMorgan Representative or visit the OCC’s website at http://www.optionsclearing.com/publications/risks/riskstoc.pdf. Legal Entities Disclosures U.S.: JPMSI is a member of NYSE, FINRA and SIPC. J.P. Morgan Futures Inc. is a member of the NFA. JPMorgan Chase Bank, N.A. is a member of FDIC and is authorized and regulated in the UK by the Financial Services Authority. U.K.: J.P. Morgan Securities Ltd. (JPMSL) is a member of the London Stock Exchange and is authorised and regulated by the Financial Services Authority. Registered in England & Wales No. 2711006. Registered Office 125 London Wall, London EC2Y 5AJ. South Africa: J.P. Morgan Equities Limited is a member of the Johannesburg Securities Exchange and is regulated by the FSB. Hong Kong: J.P. Morgan Securities (Asia Pacific) Limited (CE number AAJ321) is regulated by the Hong Kong Monetary Authority and the Securities and Futures Commission in Hong Kong. Korea: J.P. 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In the case of share trading, JPMorgan Securities Japan Co., Ltd., will be receiving a brokerage fee and consumption tax (shouhizei) calculated by multiplying the executed price by the commission rate which was individually agreed between JPMorgan Securities Japan Co., Ltd., and the customer in advance. Financial Instruments Firms: JPMorgan Securities Japan Co., Ltd., Kanto Local Finance Bureau (kinsho) No. [82] Participating Association / Japan Securities Dealers Association, The Financial Futures Association of Japan. Korea: This report may have been edited or contributed to from time to time by affiliates of J.P. Morgan Securities (Far East) Ltd, Seoul branch. Singapore: JPMSI and/or its affiliates may have a holding in any of the securities discussed in this report; for securities where the holding is 1% or greater, the specific holding is disclosed in the Legal Disclosures section above. India: For private circulation only not for sale. 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All pricing is as 16

Sachin Sheth (91-22) 6639-3004 [email protected]

Asia Pacific Equity Research 02 July 2008

of the close of market for the securities discussed, unless otherwise stated. Opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The opinions and recommendations herein do not take into account individual client circumstances, objectives, or needs and are not intended as recommendations of particular securities, financial instruments or strategies to particular clients. The recipient of this report must make its own independent decisions regarding any securities or financial instruments mentioned herein. JPMSI distributes in the U.S. research published by non-U.S. affiliates and accepts responsibility for its contents. Periodic updates may be provided on companies/industries based on company specific developments or announcements, market conditions or any other publicly available information. Clients should contact analysts and execute transactions through a JPMorgan subsidiary or affiliate in their home jurisdiction unless governing law permits otherwise. “Other Disclosures” last revised June 30, 2008.

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