CEEMEA & Latam Daybookpg.jrj.com.cn/acc/Res/CN_RES/INVEST/2017/11/10/4630cd86...Deutsche Bank Markets Research Global Periodical CEEMEA & Latam Daybook Date 10 November 2017 Friday,10

Deutsche Bank Markets Research

Global Periodical

CEEMEA & Latam Daybook

Date 10 November 2017

Friday,10 November 2017

________________________________________________________________________________________________________________ Deutsche Bank AG/London

Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, 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. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1. MCI (P) 083/04/2017.

Pascal Moura

Head of Research

(+971) 4 4283-864 [email protected]

Mairead Smith

Equity Focus

(+44) 20 754-71054 [email protected]

CEEMEA Companies COMPANY UPDATE CIB Alert (Hold, TP EGP73.00) - Q3-17 review: EPS beat on stronger margins despite lower loan growth Cyfrowy Polsat (Hold, TP PLN28.00) - 3Q: weak quarter as it was expected Enka Insaat Alert (Hold, TP TRY5.70) - 3Q17: in line; operational performance supportive, Hold Moscow Exchange Alert (Buy, TP RUB185.00) - 3Q17 first look: results in line, good fees dynamics OTE Alert (Buy, TP EUR12.90) - Q3 Rev & EBITDA broadly in line vs. Cons/DBe; Adj. FCF Outlook d/g

SECTOR UPDATE SA Company Results Diary - 13-17 November 2017 (FY17: SPP; 1H18: BAT, INL, MEI, VOD)

LATAM Companies TARGET PRICE CHANGE Lojas Renner (Hold, TP BRL34.00) - Updating estimates on 3Q17 results

COMPANY UPDATE Azul S.A. (Buy, TP USD31.00) - Record Sep Q operating margin; raising 2017 forecast Azul S.A. Alert (Buy, TP USD31.00) - Better-than-expected Sep Q results Banco do Brasil (Buy, TP BRL39.00) - 3Q17 recovery appears on track Bolsa Mexicana (Buy, TP MXN45.00) - October volume trends running ahead of our 4Q17 forecast YPF Sociedad Anonima - 3Q17: Weak Quarter Came in Above Our Ests.; Positioned for a Better 4Q

SECTOR UPDATE Metals & Mining Alert - Daily prices and news: Gold demand declines to 8-year low in 3Q17

STRATEGY EM Monthly - Emerging Markets and the Global Economy in the Month Ahead European Equity Strategy - Q3 earnings: growth slows to single-digits, as FX strength weighs EMEA Snap - Hungary and Czech Republic: Divergent

VALUATION CEEMEA and Latam valuation tables

Stock Performance(US$)–Gainers & Losers (CEEMEA) Top 10 Ticker Price %Chg

Dar Al Arkan ALARKAN AB 2.4 9.8 Alhokair ALHOKAIR AB 8.4 5.3 Sberbank SBER RX 3.7 5.1 TCS TCS LI 19.2 3.8 Saudi British Bank SABB AB 6.9 3.3 Erdemir EREGL TI 2.5 3.3 Al Tayyar ALTAYYAR AB 7.1 3.2 Moneta Money Bank MONET CP 3.6 3.1 Dana Gas DANA UH 0.2 2.8 X5 Retail Group FIVE LI 41.1 2.2

Bottom 10 Ticker Price %Chg CCC CCC PW 68.1 -6.1 Alexander Forbes AFH SJ 0.5 -4.1 RAKBANK RAKBANK UH 1.3 -4.0 Magnitogorsk Steel MMK LI 9.8 -3.9 Drake & Scull DSI DB 0.5 -3.8 Pioneer PFG SJ 8.2 -3.7 Brait BAT SJ 3.3 -3.7 Severstal SVST LI 14.8 -3.6 Clicks Group Ltd CLS SJ 10.9 -3.3 Arabtec Holding ARTC DB 0.8 -3.1

Stock Performance(US$)–Gainers & Losers (LATAM) Top 10 Ticker Price %Chg

Cencosud CENCOSUD CI 3.0 0.3 Falabella FALAB CI 9.6 0.3 Almacenes Exito EXITO CB 5.5 0.1 Gentera GENTERA*

1.0 0.0

Soriana SORIANAB

2.1 0.0 Grupo Aeromexico AEROMEX*

1.6 0.0

Megacable MEGACPO

4.2 0.0 Arca Continental AC* MM 6.6 0.0 Kimberly-Clark de

KIMBERA MM 1.8 0.0

Banorte GFNORTEO

6.0 0.0

Bottom 10 Ticker Price %Chg Grupo Bimbo BIMBOA MM 2.3 -0.7 Cia Hering HGTX3 BS 8.6 -0.2 Natura NATU3 BS 9.1 -0.2 Petrobras PETR4 BS 5.2 -0.2 B2W BTOW3 BS 5.8 -0.2 Petrobras PETR3 BS 5.4 -0.2 Lojas Americanas LAME4 BZ 4.9 -0.2 Multiplus MPLU3 BZ 10.9 -0.2 Minerva BEEF3 BS 3.4 -0.2 Banco do Brasil BBAS3 BS 10.2 -0.2

Source::Bloomberg Finance LP

Distributed on: 10/11/2017 05:18:56 GMT

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Russia / CIS LatamGeorge Buzhenitsa Metal & Mining +971 4 361 1734 Ryan Todd Oil & Gas +1 212 250 8342Ivan Kachkovski Banks/Financials +44 207 5411735 Xavier Marchand Building materials +44 207 545 1400Pavel Kushnir Oil & Gas +971 4 361 1732 Chris Terry Metals & Mining +1 212 250 5434Masha Kahn TMT +1 212 250 9619 Tito Labarta Financials/Banks +1 212 250 5944Marc Hammoud Healthcare +971 4 4283910 Joana Barros-Magalhaes Financials/Banks +1 212 250 1002Tomasz Krukowski Consumer +48 22 579 8732 Michael Linenberg Airline +1 212 250 9254Aleksandar Stojanovski Transport +971 4 361 1786Lloyd Walmsley Internet +1 212 250-7063 Marcel Moraes Retail +1 904 271-2470

Masha Kahn TMT +1 212 250 9619Elina Ribakova Economist +44 207 547 1340 Catherine O' Brien Loyalty Programs +1 212 250 8949

Lloyd Walmsley Internet +1 415 262 2028South Africa Jose Yordan Food&Beverage/Retailing +1 212 250 5528Pavel Kushnir Oil & Gas +971 4 361 1732 Myles Walton Aerospace Defense +1 212 250 5528Caron Bramwell Retail, Real Estate, Food Producer +27 11 775 7069Ryan Eichstadt Retail, Real Estate, Food Producer +27 11 775 7249 Drausio Giacomelli Chief Economist +1 212 250 7355Sean Holmes Retail, Real Estate, Food Producer +27 11 775 7292 Sebastian Brown Senior Economist Mexico & Chile +1 212 250 8191Letlotlo Lenake Healthcare +27 11 775 7299 Cesar Arias Senior Economist Andean countries +1 212 250-0664John Kim TMT +27 11 775 7013 Jose Carlos de Faria Senior Economist Brazil +55 11 2113 5185Patrick Mann Metals & Mining +27 11 775 7268 Hongtao Jiang Head of EM Sovereign Credit +1 212 250-2524Mathias Pfeifenberger Paper +43(1)53181-153 Jed Evans Head of EM Analytics +1 212 250-8605Stefan Swanepoel Banks/Financials +27 11 775 7369 Guilherme Marone EM Derivative and Latam Strategist +1 212 250-8640Larissa van-Deventer Insurance/Financials +27 11 775 7049 Eduardo Vieira Head of EM Corporates +1 212 250-7568Munira Kharva Industrial +27 11 775 7433 Sebastian Brown Latam FX Strategist +1 212 250 8191

Danelee Masia Economist +27 11 775 7267 GreeceJames Brand Utility +44 207 5474705

Turkey Robert Grindle Telecommunication +44 207 54548490Kazim Andac Banks/Financials +90 212 3190315 Ivan Kachkovski Banks +44 207 5411735Athmane Benzerroug Construction, RE +90 212 3190324 Tomasz Krukowski O&G +48 22 579 8732George Buzhenitsa Metal & Mining +971 4 361 1734 Priyal Mulji Construction +44 207 5472094John Kim TMT +27 11 775 7013

George Saravelos FX Strategist +44 207 5479118Kubilay Ozturk Economist +44 207 5458774

Middle EastCE3 Ryan Ayache Banks +971 4 428 3261James Brand Utility +44 207 5474705 Athmane Benzerroug Construction, Infrastructure, Utilities +971 4 428 3938Kazim Andac Banks/Financials +90 212 3190315 Marc Hammoud Telco, Healthcare +971 4 4283910Ivan Kachkovski Banks/Financials +44 207 5411735 Aleksandar Stojanovski Chemicals/Consumer/Transport/Strategist +971 4 361 1786Tomasz Krukowski Consumer +48 22 579 8732

Alizerra Kharazi Economist +44 207 5450083Gautam Kalani Economist +44 207 545 7066 Elina Ribakova Chief Economist +44 207 5471340

Emerging EMEA/Latam ResearchHead of Company Research Pascal Moura +971 44283864

Source: Deutsche Bank

10 November 2017


Deutsche Bank AG/London Page 3

ASIAN MARKET TOP STORIES NCSOFT (036570.KS, Buy) – Fear cycle kicking in; buy the dip (Han Joon Kim) http://pull.db-gmresearch.com/p/820-B744/66620213/c5b584ba-0484-484c-bd1a-d586128846f1_604.pdf Asia Internet – Mobile messaging: between disillusionment and enlightenment (Han Joon Kim) http://pull.db-gmresearch.com/p/829-81B6/68469811/f949e619-7383-4aa0-84a7-1bfd53f32295_604.pdf Shiseido (4911.T, Buy) – Preemptive investments and reforms paying off stronger than expected (Jihyun Song) http://pull.db-gmresearch.com/p/238-42C7/72936148/0900b8c08dce007c.pdf

RECOMMENDATION CHANGES NHPC (NHPC.BO, Buy) – Results good despite Teesta shutdowns- u/g to Buy (Abhishek Puri) http://pull.db-gmresearch.com/p/546-604F/70153447/8269033b-da5a-4c88-8ebf-895f5966e442_604.pdf

ESTIMATES AND TARGET PRICE CHANGES China SCE (1966.HK, Buy) – Sales to accelerate in 2018F; 30% earnings CAGR implies low valuation (Stephen Cheung) http://pull.db-gmresearch.com/p/813-E7EE/69205470/0900b8c08da3abaa.pdf INPEX (1605.T, Buy) – 1H FY3/18 Briefing - Ichthys in commissing (John Hirjee) http://pull.db-gmresearch.com/p/728-05FB/67710030/0900b8c08dcde004.pdf Press Kogyo (7246.T, Buy) – 2Q results: Raising forecasts in light of guidance hike; reiterate Buy (Takeshi Kitaura) http://pull.db-gmresearch.com/p/530-BEC6/62478189/0900b8c08dccb002.pdf S Foods (2292.T, Buy) – Raising TP to reflect steak popularity (Junichi Shimizu) http://pull.db-gmresearch.com/p/242-B014/65913474/0900b8c08dc27e2e.pdf Goodman Group (GMG.AX, Hold) – 1Q18 Update; guidance reaffirmed despite fall in WACD (Emily Smith) http://pull.db-gmresearch.com/p/609-82D4/64851196/0900b8c08dcc7ea5.pdf Goodman Property Trust (GMT.NZ, Hold) – Portfolio repositioning accelerated (Joshua Dale) http://pull.db-gmresearch.com/p/247-E80D/63983404/0900b8c08dc91f24.pdf James Hardie Industries (JHX.AX, Buy) – Q2FY18 result: FY19 well positioned for volume and margin improvement (Emily Smith) http://pull.db-gmresearch.com/p/499-1196/67096614/0900b8c08dcc2d58.pdf Santos (STO.AX, Buy) – STO Investor Day - Positioning for growth (John Hirjee) http://pull.db-gmresearch.com/p/870-9E89/68753535/0900b8c08dcd1f07.pdf Xero (XRO.NZ, Hold) – Hello, goodbye (Stephen Ridgewell) http://pull.db-gmresearch.com/p/265-D65C/67991786/0900b8c08dcbbabd.pdf Emart (139480.KS, Buy) – Online profitability improvement and restructuring effects to kick in (Jihyun Song) http://pull.db-gmresearch.com/p/834-0224/71065981/0900b8c08dcd8c5e.pdf HTC (2498.TW, Sell) – Another quarter of disappointment (Birdy Lu) http://pull.db-gmresearch.com/p/607-3285/67991258/0900b8c08dcdb4ca.pdf Pegatron (4938.TW, Hold) – 3Q17 EPS missed on weak margin; trimming target price (James Chiu) http://pull.db-gmresearch.com/p/601-B90F/68975078/0900b8c08dcc0380.pdf Ashok Leyland Ltd (ASOK.BO, Buy) – Results miss consensus margin expectations; we remain +ve on growth (Amyn Pirani) http://pull.db-gmresearch.com/p/549-015F/65323244/a5df065d-53a7-459d-9679-7c7693c21dca_604.pdf Indraprastha Gas – Robust volume growth continues (Harshad Katkar) http://pull.db-gmresearch.com/p/601-A72F/69906012/b7507eb6-c488-11e7-bf02-2d390be1d4c2_604.pdf Thermax Limited (THMX.BO, Hold) – Improving at the margin… (Abhishek Puri) http://pull.db-gmresearch.com/p/515-1E07/66850133/e0d0f3fd-4466-48a8-adc4-5fe2b40f7b5a_604.pdf Keppel Corp Ltd – Improving prospects on four key fronts (Joshua Lee) http://pull.db-gmresearch.com/p/532-BC93/72026821/1515212d-0a18-4368-b80d-5f527792d716_604.pdf Bangkok Life Assurance (BLA.BK, Hold) – 3Q17A: likely the bottom (Peach Patharavanakul) http://pull.db-gmresearch.com/p/719-EEDC/68118268/0900b8c08dcdd707.pdf

MACRO/STRATEGY DBDaily – Equities weaker as Senate confirms intention to delay corporate tax cut… (Ken Crompton) http://pull.db-gmresearch.com/p/9273-B083/72637422/DB_DbDailyAPAC_2017-11-09_5b5200f6-c4cb-11e7-bf02-2d390be1d4c2_604.pdf

10 November 2017


Page 4 Deutsche Bank AG/London

MACRO/STRATEGY Dollar Bloc Weekly – 9 November 2017. (Adam Boyton) http://pull.db-gmresearch.com/p/3090-9994/63632932/DB_DollarBlocWkly_2017-11-09_f95e4872-bf85-11e7-a788-17efe23f6f57_604.pdf Data Flash – Japan: September machinery orders (Mikihiro Matsuoka) http://pull.db-gmresearch.com/p/728-7AB2/63865568/DB_DataFlash_2017-11-09_0900b8c08dcaf1f2.pdf FX Blog – Alpha Alert - Nikkei/FX when equity/bond correlation breaks down (Alan Ruskin) http://pull.db-gmresearch.com/p/380-7043/68619184/56848ba6-c463-478b-bb3e-8819401e2856_604.pdf Global Financial Strategy – What caused the big swing in Japan today? Volatility-targeting strategy (Masao Muraki) http://pull.db-gmresearch.com/p/797-4377/72391610/0900b8c08dcda484.pdf Japan FX Insights – JPY: October international securities flow (Taisuke Tanaka) http://pull.db-gmresearch.com/p/1010-4DEA/65617783/DB_DEJAViewFX_2017-11-09_a013a828-83ea-4538-8992-efab91058291_604.pdf Data Flash (New Zealand) – RBNZ OCR review and November MPS (Ken Crompton) http://pull.db-gmresearch.com/p/852-A72B/62558023/79837fbc-698b-44a2-84cc-eaa374e86cc9_604.pdf India Economics Weekly – Special: Oil on the boil - stress testing India’s macro indicators (Kaushik Das) http://pull.db-gmresearch.com/p/13303-9899/70055514/DB_IndiaEconWkly_2017-11-09_4a738ad8-c2ec-11e7-bf02-2d390be1d4c2_604.pdf European Equity Strategy – Q3 earnings: growth slows to single-digits, as FX strength weighs (Wolf von Rotberg) http://pull.db-gmresearch.com/p/5419-F41D/64462401/Strategy_Snapshot.pdf

HONG KONG / CHINA Bright Scholar (BEDU.N, Buy) – Long-term growth still solid; Buy (Alvin Jiang) http://pull.db-gmresearch.com/p/1008-30FB/70355279/0900b8c08dc62255.pdf China Gas Holdings (0384.HK, Hold) – Signing an MOU with US LNG exporter to diversify gas sources (Hanyu Zhang) http://pull.db-gmresearch.com/p/768-7091/68945327/d8b3038c-83d4-441d-bc91-384cd06c6a34_604.pdf China Rail Sector – Diverging outlook, diverging stocks (Sky Hong) http://pull.db-gmresearch.com/p/698-9C1A/69340351/1cb610f0-a219-4827-a61b-1ce9a55fc2d9_604.pdf Galaxy (0027.HK, Hold) – 3Q in-line; VIP strong but mass just so so (Karen Tang) http://pull.db-gmresearch.com/p/879-AF2E/63511965/2d94c750-c36f-11e7-bf02-2d390be1d4c2_604.pdf

JAPAN Bridgestone (5108.T, Hold) – 3Q initial impression – Surprises with downgrade (Kurt Sanger) http://pull.db-gmresearch.com/p/654-F4FD/67186047/0900b8c08dcd501d.pdf Cookpad (2193.T, Hold) – Results comment: challenging conditions (Takahiro Kazahaya) http://pull.db-gmresearch.com/p/227-9ECC/68853084/0900b8c08dcdebde.pdf Daiwa House Industry (1925.T, Hold) – 2Q results: neutral first impression (Yoji Otani) http://pull.db-gmresearch.com/p/260-9EDB/65790806/0900b8c08dcd7c73.pdf Life insurance sector – 1H preview for 4 lifers: Progress rate, new policies, premium cut in 2018 (Masao Muraki) http://pull.db-gmresearch.com/p/560-7EC5/71741404/0900b8c08dcc1881.pdf Mizuho FG (8411.T, Hold) – Restructuring of retail operations (Yoshinobu Yamada) http://pull.db-gmresearch.com/p/542-23E6/64252604/0900b8c08dcd3da8.pdf MUFG (8306.T, Buy) – MUFG seeks 40% stake in Danamon: Good even as pure investment (Yoshinobu Yamada) http://pull.db-gmresearch.com/p/545-FB5E/65247463/0900b8c08dcd47fa.pdf Pioneer (6773.T, Hold) – Results comment: 2Q earnings in line with guidance (Hiroshi Taguchi) http://pull.db-gmresearch.com/p/533-141B/67351968/0900b8c08dcdcf8e.pdf Real estate sector – Real estate shares’ recent rise just trying to play catch-up (Yoji Otani) http://pull.db-gmresearch.com/p/261-35A7/65335420/0900b8c08dcd8dfc.pdf Skylark (3197.T, Buy) – 3Q results and October sales (Junichi Shimizu) http://pull.db-gmresearch.com/p/244-65F7/66804649/0900b8c08dc4db69.pdf SUMCO (3436.T, Buy) – Higher wafer demand forecasts likely to prompt rise in valuations (Yu Yoshida) http://pull.db-gmresearch.com/p/250-932E/67958837/0900b8c08dcddc40.pdf Sumitomo Forestry (1911.T, Hold) – Neutral 2Q results; acquisition of Kumagai Gumi shares a surprise (Yoji Otani) http://pull.db-gmresearch.com/p/259-826E/66805351/0900b8c08dcd3751.pdf

10 November 2017



JAPAN Suruga Bank (8358.T, Buy) – Loan-deposit spread for 2Q flat QoQ (Yoshinobu Yamada) http://pull.db-gmresearch.com/p/536-45EC/66400674/0900b8c08dcd7fc3.pdf Sysmex (6869.T, Buy) – Takeaways from management meeting (Jack Hu) http://pull.db-gmresearch.com/p/1021-0037/68933958/b3b54236-04ba-4a12-8ae1-31c3a33e4cd3_604.pdf Tokyu Fudosan Holdings (3289.T, Hold) – 2Q results: neutral first impression (Yoji Otani) http://pull.db-gmresearch.com/p/258-B3F4/67061443/0900b8c08dcd379a.pdf

AUSTRALIA Bridgestone (5108.T, Hold) – 3Q initial impression – Surprises with downgrade (Kurt Sanger) http://pull.db-gmresearch.com/p/654-F4FD/67186047/0900b8c08dcd501d.pdf Cookpad (2193.T, Hold) – Results comment: challenging conditions (Takahiro Kazahaya) http://pull.db-gmresearch.com/p/227-9ECC/68853084/0900b8c08dcdebde.pdf Daiwa House Industry (1925.T, Hold) – 2Q results: neutral first impression (Yoji Otani) http://pull.db-gmresearch.com/p/260-9EDB/65790806/0900b8c08dcd7c73.pdf Life insurance sector – 1H preview for 4 lifers: Progress rate, new policies, premium cut in 2018 (Masao Muraki) http://pull.db-gmresearch.com/p/560-7EC5/71741404/0900b8c08dcc1881.pdf Mizuho FG (8411.T, Hold) – Restructuring of retail operations (Yoshinobu Yamada) http://pull.db-gmresearch.com/p/542-23E6/64252604/0900b8c08dcd3da8.pdf MUFG (8306.T, Buy) – MUFG seeks 40% stake in Danamon: Good even as pure investment (Yoshinobu Yamada) http://pull.db-gmresearch.com/p/545-FB5E/65247463/0900b8c08dcd47fa.pdf Pioneer (6773.T, Hold) – Results comment: 2Q earnings in line with guidance (Hiroshi Taguchi) http://pull.db-gmresearch.com/p/533-141B/67351968/0900b8c08dcdcf8e.pdf Real estate sector – Real estate shares’ recent rise just trying to play catch-up (Yoji Otani) http://pull.db-gmresearch.com/p/261-35A7/65335420/0900b8c08dcd8dfc.pdf Skylark (3197.T, Buy) – 3Q results and October sales (Junichi Shimizu) http://pull.db-gmresearch.com/p/244-65F7/66804649/0900b8c08dc4db69.pdf SUMCO (3436.T, Buy) – Higher wafer demand forecasts likely to prompt rise in valuations (Yu Yoshida) http://pull.db-gmresearch.com/p/250-932E/67958837/0900b8c08dcddc40.pdf Sumitomo Forestry (1911.T, Hold) – Neutral 2Q results; acquisition of Kumagai Gumi shares a surprise (Yoji Otani) http://pull.db-gmresearch.com/p/259-826E/66805351/0900b8c08dcd3751.pdf Suruga Bank (8358.T, Buy) – Loan-deposit spread for 2Q flat QoQ (Yoshinobu Yamada) http://pull.db-gmresearch.com/p/536-45EC/66400674/0900b8c08dcd7fc3.pdf Sysmex (6869.T, Buy) – Takeaways from management meeting (Jack Hu) http://pull.db-gmresearch.com/p/1021-0037/68933958/b3b54236-04ba-4a12-8ae1-31c3a33e4cd3_604.pdf Tokyu Fudosan Holdings (3289.T, Hold) – 2Q results: neutral first impression (Yoji Otani) http://pull.db-gmresearch.com/p/258-B3F4/67061443/0900b8c08dcd379a.pdf

KOREA/TAIWAN Bizlink (3665.TW, Buy) – 3Q17 earnings preview (Frank Lin) http://pull.db-gmresearch.com/p/596-EB7D/68044679/0900b8c08dcdc97b.pdf Hota Industrial (1536.TW, Buy) – 3Q17 results were in line with our estimate (Frank Lin) http://pull.db-gmresearch.com/p/596-213D/67239480/0900b8c08dcdc9de.pdf MediaTek (2454.TW, Buy) – The implication of a competitive landscape change (Michael Chou) http://pull.db-gmresearch.com/p/623-3576/66940172/0900b8c08dcde36f.pdf Samsung Life (032830.KS, Buy) – Starting to recognize the benefits of higher rates and bigger dividends (Jeehoon Park) http://pull.db-gmresearch.com/p/781-E5B1/68785148/0900b8c08dcd925f.pdf

INDIA HPCL (HPCL.BO, Buy) – Weak refining performance leads to a miss (Harshad Katkar) http://pull.db-gmresearch.com/p/600-7251/67834850/c0dcdfec-c519-11e7-bf02-2d390be1d4c2_604.pdf Indian Pharmaceuticals – IPM Monthly sales tracker (Kartik Mehta) http://pull.db-gmresearch.com/p/548-741E/65729081/0a09c7c4-c43a-11e7-bf02-2d390be1d4c2_604.pdf Tata Motors Ltd (TAMO.BO, Buy) – Stronger mix drives margins at JLR; volume growth still needs to improve (Amyn Pirani) http://pull.db-gmresearch.com/p/558-AF9D/72622751/0900b8c08dcad84b.pdf

10 November 2017



ASEAN SATS (SATS.SI, Buy) – 2Q results: associates strong, positive potential of new ventures (Joe Liew) http://pull.db-gmresearch.com/p/827-B522/67927507/0900b8c08dcdbce3.pdf Singapore Telecom (STEL.SI, Buy) – AU mobile, SG enterprise & Digital report positive operating trends (Srinivas Rao) http://pull.db-gmresearch.com/p/966-46C4/64109523/0900b8c08dcaafd8.pdf Central Pattana (CPN.BK, Hold) – Key takeaways from analyst briefing (Nash Shivaruchiwong) http://pull.db-gmresearch.com/p/602-BC42/65814868/0900b8c08dcda44c.pdf IRPC PCL (IRPC.BK, Buy) – Takeaways from analyst meeting: Positive outlook (Wattana Punyawattanakul) http://pull.db-gmresearch.com/p/756-B8FD/67723931/4436d9ef-46bf-434e-aa36-48290b5445f1_604.pdf L.P.N. Development (LPN.BK, Hold) – Quarterly profit misses from weak operations (Nash Shivaruchiwong) http://pull.db-gmresearch.com/p/638-6F76/69724103/0900b8c08dce080f.pdf Bloomberry Resorts (BLOOM.PS, Buy) – EBITDA, profit ahead of estimates; mass volumes hit new highs (Aaron Salvador) http://pull.db-gmresearch.com/p/497-F101/67200363/0900b8c08dcc179e.pdf DMCI Holdings (DMC.PS, Hold) – 9M17 earnings fall short (Klyne Resullar) http://pull.db-gmresearch.com/p/726-44A4/66750960/0900b8c08dcaf2d2.pdf International Container (ICT.PS, Buy) – EBITDA gains momentum in 3Q17 (Klyne Resullar) http://pull.db-gmresearch.com/p/780-AAC2/62543676/0900b8c08dcaf5e7.pdf Metro Pacific Investments (MPI.PS, Hold) – 3Q17 profit up 43% YoY; Resolution on tariff issues soon? (Klyne Resullar) http://pull.db-gmresearch.com/p/726-21A9/67854687/0900b8c08dcaf4b5.pdf PLDT, Inc. (TEL.PS, Hold) – Still no turn in 3Q (Gio Dela-Rosa) http://pull.db-gmresearch.com/p/514-0B44/67059767/0900b8c08dcd8bcf.pdf Robinsons Land Corp (RLC.PS, Hold) – 9M17 recurring profit +6%; 3Q residential sales rebound 29% YoY (Carl Sy) http://pull.db-gmresearch.com/p/824-31A4/66410728/0900b8c08dcc6666.pdf Semirara Mining and Power (SCC.PS, Buy) – Asset write-down not a concern; Reiterate Buy (Klyne Resullar) http://pull.db-gmresearch.com/p/857-E2DF/67480778/0900b8c08dcdc51a.pdf APAC Equities - APAC Research In Focus UPCOMING DB CONFERENCES dbAccess Global Quant Conference 2017 14-15 Nov @Hong Kong dbAccess Thailand SET Corporate Day - 22-23 Nov @Singapore

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No

vemb

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17

Deu

tsche B

ank A

G/Lo

nd

on

P

age 7

EPS changes

NAME COUNTRY DB EPS FY1 DB EPS FY2 DB EPS FY3 RECOMMENDATION TARGET PRICE

From To Change IBES

DB vs IBES

(%) From To Change IBES

DB vs IBES

(%) From To Change IBES

DB vs IBES

(%) From To From To Change

CEEMEA

Enka Insaat Turkey 0.1 0.2 +25.5 0.2 1.1 0.1 0.2 +41.1 0.2 13.0 Hold Hold 5.7 5.7

LATAM

Azul S.A. Brazil 0.5 1.0 +94.2 1.4 1.4 +0.1 1.9 1.9 -0.1 Buy Buy 31.0 31.0

Lojas Renner Brazil 1.0 1.1 +10.2 6.8 -84.3 1.2 1.3 +6.0 8.1 -84.1 4.2 8.7 Hold Hold 32.6 34.0 +4.3

ASIA

Keppel Corp Ltd Singapore 0.5 0.7 +58.4 0.8 -13.3 0.5 0.6 +36.3 0.4 0.8 +92.1 Buy Buy 7.5 8.6 +14.7

Emart Korea 15,552. 23,429.

+50.7 21,058.

11.3 17,927.

17,622.

-1.7 19,404.

-9.2 20,045.

19,740.

-1.5 Buy Buy 280,000

290,00

+3.6

Bizlink Taiwan 10.4 10.3 -1.5 12.6 12.2 -2.8 15.5 15.5 +0.1 Buy Buy 320.0 320.0

Hota Industrial Taiwan 5.0 4.9 -2.2 6.7 6.5 -2.5 8.5 8.6 +1.0 Buy Buy 170.0 170.0

China SCE China 0.5 0.5 -3.4 0.7 0.7 -10.1 0.9 0.8 -8.2 Buy Buy 4.4 4.6 +3.6

NCSOFT Korea 22,096. 20,618.

-6.7 15,199.

35.7 29,113.

29,072.

-0.1 16,146.

80.1 29,742.

29,834.

+0.3 Buy Buy 640,000

640,00

Ashok Leyland Ltd India 5.0 4.7 -7.4 5.1 -8.0 6.1 5.8 -4.4 7.5 7.3 -2.2 Buy Buy 135.0 130.0 -3.7

Tata Motors Ltd India 35.6 32.2 -9.5 94.9 -66.1 54.6 52.9 -3.1 101.8 -48.0 64.3 63.0 -2.1 Buy Buy 490.0 490.0

Thermax Limited India 27.6 24.5 -11.0 54.0 -54.5 31.2 32.6 +4.4 56.0 -41.8 38.5 41.0 +6.6 Hold Hold 870.0 980.0 +12.6

Bright Scholar China 3.4 3.0 -12.6 5.2 4.6 -12.4 6.8 Buy Buy 32.0 32.0

Bangkok Life Assurance Thailand 2.5 2.0 -20.2 4.4 -55.0 2.6 2.4 -7.2 3.1 3.3 +5.7 Hold Hold 43.0 39.0 -9.3

Pegatron Taiwan 8.5 6.5 -23.4 10.4 -36.9 8.9 8.0 -9.2 9.0 8.5 -6.2 Hold Hold 97.0 88.0 -9.3

HTC Taiwan -8.4 -10.4 -23.9 2.6 -491.8 -5.3 27.1 +0.0 11.6 134.5 -5.0 -7.6 -51.0 Sell Sell 35.0 56.0 +60.0

Indraprastha Gas India 51.0 10.7 -79.0 211.0 -94.9 56.8 11.9 -79.0 13.6 Buy Buy 1,400.0 320.0 -77.1

NHPC India Hold Buy 33.0 33.0

Source: Bloomberg Finance

10 November 2017



Solar Portfolio

9-Nov-17

Companies RIC Buy/Sell Promoted Entry Price Current Price Performance

CE3

X5 RETAIL GROUP PJPq.L Buy 19/10/2017 40.26 40.85 1.47%

MENA

NMC HEALTH NMC.L Buy 01/10/2017 2,751.00 3,183.00 15.70%

TELECOM EGYPT ETEL.CA Buy 01/10/2017 12.95 12.73 -1.70%

SAUDI TELECOM COMPANY 7010.SE Buy 01/10/2017 70.50 69.20 -1.84%

HERFY 6002.SE Buy 23/10/2017 46.74 45.00 -3.72%

GULF INT'L SERVICES GISS.QA Buy 01/10/2017 19.99 15.65 -21.71%

NMC HEALTH NMC.L Buy 01/10/2017 2,751.00 3,183.00 15.70%

Russia

TRANSNEFT TRNF_p.MM Buy 01/10/2017 177,400.00 184,250.00 3.86%

GAZPROM GAZP.MM Buy 23/10/2017 126.92 131.77 3.82%

NOVATEK NVTKq.L Sell 23/10/2017 118.29 116.70 1.34%

SASOL SOLJ.J Sell 27/10/2017 40,874.81 43,550.00 -6.54%

South Africa

STANDARD BANK SBKJ.J Buy 01/10/2017 15,781.00 16,599.00 5.18%

BARCLAYS AFRICA GROUP BGAJ.J Buy 01/10/2017 13,900.00 14,410.00 3.67%

HYPROP HYPJ.J Buy 01/10/2017 10,572.00 10,750.00 1.68%

Turkey

VAKIFBANK VAKBN.IS Sell 01/10/2017 6.27 6.02 3.99%

AKBANK AKBNK.IS Buy 01/10/2017 9.40 10.04 6.81%

Source: Bloomberg Finance LP

Rating

Hold Middle East

Egypt

Banking

Company

CIB Alert Date

9 November 2017

Results

Q3-17 review: EPS beat on stronger margins despite lower loan growth

Reuters Bloomberg Exchange Ticker COMI.CA COMI EY CAI COMI

ADR Ticker ISIN CIBEY US2017123041

Price at 8 Nov 2017 (EGP) 77.00

Price Target (EGP) 73.00

52-week range (EGP) 88.53 - 65.21

Ryan Ayache

Research Analyst

(+971) 4 428-3261

[email protected]

Stock data

Price Target (EGP) 73.00

Market cap (EGP) 88,848

Shares outstanding (m) 1,153.87

Free float (%) 0.9

EGX 30 Index 14,205.0


Key data

FYE 12/31 2016A 2017E 2018E

Stated Net Profit (EGP)

6,009 9,191 11,015

EPS Adjusted (EGP)

4.55 7.11 8.24

Dividend Yield (%)

1.1 2.1 2.5

P/E Adjusted (x) 16.05 10.83 9.34


CIB Q3-17 results

EGPm Q3 17E Q3 17A YoY QoQ vs . DBe

Net interest income 3,150 3,567 41% 21% 13%

Total revenues 4,015 4,386 39% 17% 9%

Operating costs 1,018 1,035 34% 4% 2%

Gross operating profit 2,997 3,351 41% 22% 12%

Impairment charge 475 594 234% 122% 25%

Headline net income 1,907 2,087 23% 14% 9%

Adj . net income* 1,687 1,847 23% 14% 10%

Loans 93,959 87,996 45% -4% -6%

Total assets 286,525 282,886 37% 2% -1%

Deposits 250,718 247,734 39% 1% -1%

Equity 25,851 26,609 38% 10% 3%

Source: Deutsche Bank, Company data.

Valuations, risks: We retain Hold rating as we

believe share prices fully reflect fundamentals: CIB

trades at a premium to regional/global peers: 9.3x

2018e PE and 2.4x PB vs. MENA banks (8.5x, 1.2x)

and GEMS banks (9.5x, 1.1x). Key upside/(downside)

risks: Macroeconomic stabilization/ (deterioration).

Q3-17 net income EGP2,087m vs. DBe 1,907m, Bloomberg consensus 1,998m Strong net interest income (and in turn NIMs +94bps QoQ vs. DBe 20bps) more than offset weaker NIR and higher loan impairments (CoR c.270bps vs. DBe 200bps) and led the net income beat. On the other hand, loan growth disappointed (-4% QoQ), although investments, deposits and total assets grew sequentially. A good set of results. Hold.

NII and NIMs stronger than expected; NIR relatively modest NII rose 41% YoY / 21% QoQ, much stronger than expected. Margins on

average IEA recovered a further 94bps QoQ to 5.70%. Asset yields(+150bps QoQ) rose c.3x funding costs, on the back of a 200bps increasein policy rates at the start of the quarter (YoY comparison not meaningfulas average balances distorted by FX devaluation in Q4-16).

NIR: Fees were flat in the quarter (+56% YoY); investments gains werelower than expected (EGP101m vs. DBe 140m) but were partly offset bystronger FX income (+11% QoQ, 5% above DBe).

Operating costs rose 4% QoQ and 34% YoY; cost/ income ratio lookinggood (DB calculations Q3 23.6%, 9M 25.5%).

NPLs/ gross loans rose 13bps QoQ to 6.94% with 155% coverage. Loanimpairments were an annualized 274bps of gross loans (9M 210bps).

BS: loans -4% QoQ, +3% YTD; investments +25%/+24%; deposits +1%/+7% Both EGP and foreign currency denominated loans declined in the quarter.

Margin-accretive EGP denominated loans have risen 26% YTD(constituting 52% of total loans, up from 43% in Dec-16), while foreigncurrency loans declined 12% YTD. It remains to be seen if there is achange in growth guidance (Q1-17 conference call, full year loan growth ofc.10% at the group level, 25-30% for EGP-denominated loans).

Investments on the other hand grew strongly and remain the largestcomponent of the balance sheet (44% of assets).

Deposit growth came from time deposits (+7% QoQ), although the CASAratio at 48% improved from 43% at the start of the year.

Capital ratios improved and are comfortable (T1 15.9%, CAR 16.9%).

10 November 2017 CEEMEA & Latam Daybook


9 November 2017

Media

Rating

Hold

Valuation & Risks

MediaPrice at 8 Nov 2017 (PLN) 25.50

Price Target (PLN) 28.00

52-week range (PLN) 27.80 - 22.65

ResultsEmerging EuropePoland

Company

Cyfrowy Polsat

Reuters Bloomberg Exchange Ticker

CPS.WA CPS PW WSE CPS

Date9 November 2017

3Q: weak quarter as it was expected

Soft figures but with no impact on our FY forecastsCyfrowy delivered weak results in 3Q 2017 with an 11% decline in EBITDA,largely driven by negative effect of EU roam-like-and-home regulations as wellas high base effect. This, however, is in line with our expectations for 3Q aloneand full year: the surplus accumulated in very strong first half, compensates forthe pressures in the second half of the year, hence we keep our FY estimatesunchanged. We reiterate our Hold rating on Cyfrowy and PLN 28 target price.High FCF (11%) is the main attraction in the company's investment case, but thisdoes not yet convert into any meaningful dividend payment.

Roaming costs and high base effect responsible for YoY EBITDA declineIn 3Q Cyfrowe delivered flat YoY revenues of PLN 2,391m and an 11% decline inEBITDA to PLN 851m. Both figures are in line with our and market expectations.EU roam-like-at-home regulations account for ca. 60% of the YoY deteriorationin earnings with negative impact on EBITDA of PLN 62m. The remainder ofthe pressure comes from TV broadcasting segment: in 3Q 2016 the company'searnings were positively impacted by a sport event, which created a very highbase and consequently EBITDA in that business line declined this quarter by 29%YoY. On the KPI fronts, after weak 1H, some improvement was visible: numberof contract RGUs increased by 110k vs. quarterly run rate of 82k in the first halfof the year. Pay TV as well as mobile telephony dominate among new additions,suggesting continuation of the bundling strategy.

Figure 1: Cyfrowy Polsat: 3Q 2017 results reviewPLNm 3Q 2016 4Q 2016 1Q 2017 2Q 2017 3Q 2017 YoY 3Q 2017E

Revenues 2,388 2,535 2,389 2,470 2,391 0% 2,376

EBITDA, of which 957 902 929 964 851 -11% 854

Teleco & pay TV 829 749 821 808 760 -8% 759 TV Broadcasting 128 154 108 155 91 -29% 95

Margin (%) 40.1% 35.6% 38.9% 39.0% 35.6% - 35.9%

Net profit 270 350 271 291 243 -10% 234

Source: Company data, Deutsche Bank

Tomasz Krukowski, CFA

Research Analyst

+44-20-7541-2197

Price/price relative

Cyfrowy Polsat WIG 20 Index (Rebased)

2015 2016 201715

20

25

30

Performance (%) 1m 3m 12m

Absolute 0.1 -3.2 6.2

WIG 20 Index 1.4 3.6 40.9Source: Deutsche Bank



Rating

Hold Emerging Europe

Conglomerates

Company

Enka Insaat Alert Date

9 November 2017

Results

3Q17: in line; operational performance supportive, Hold

Reuters Bloomberg Exchange Ticker ENKAI.IS ENKAI TI IST ENKAI

ADR Ticker ISIN EKIVY US2933561019

Price at 8 Nov 2017 (TRY) 5.81

Price Target (TRY) 5.70

52-week range (TRY) 6.26 - 4.55

Athmane Benzerroug

Research Analyst

(+971) 4 4283938

[email protected]

Stock data

Market Cap (TRYm) 24,402.0

Market Cap (US$m) 6,308.8

Free float (%) 12

ISE National 100 Index 111,894.5


Key data

FYE 12/31 2016A 2017E 2018E

Revenue (USDm)

3,506 3,099 3,572

Net Profit (USDm)

589 730 859

DB EPS (USD) 0.14 0.17 0.20

DPS (USD) 0.04 0.04 0.04

P/E (DB EPS) (x) 10.8 8.6 7.3


3Q17: in line; EBITDA margin supportive 3Q17 NP came in at USD178m (-12% QoQ, c.+55% YoY) c.+5% DBe / cons. (USD167m). The NP was driven by higher revenues in Construction and Energy segment (26% / 34% QoQ respectively) coupled with strong EBITDA margin YoY (+300bps above 3Q16). Revenues came at USD843m (c.+21% QoQ, -2% YoY) or c.10% / 20% above DBe / cons. (USD698m). EBITDA margin was also supportive at 23.3% (in line with 2Q17) but slightly below DBe: 24% / cons.: 22.6% at USD196m. Net investment income decreased by c.50% QoQ to USD50m in 3Q17 due to depreciation in Turkish Euro bonds. 9M17 NP reached USD550m or c.75% vs. 2017 DBe (USD730m).

Higher construction revenues on higher execution; strong margin Construction execution came in above 2Q17 (revenues USD296m or 10% above DBe) mainly due to higher recognition of revenue. Works on Iraqi power project (new award in 4Q16) did not contribute towards revenue in 3Q17 and we do not expect to contribute in 2017. EBITDA margin reached high level of 23.3% after 16.7% in 2Q17 and 10% in 3Q16. 3Q17 EBITDA margin is already above mgt. expectations for FY2017 (c.13% / DBe: 15.1%). Backlog stood at USD2.5bn end 3Q17 (+50% YoY) while new awards were strong at USD450m (2x YoY). Overall, in 9M17 Enka recorded total construction revenue of c.70% vs. 2017 DBe (USD1.1bn) and c.85% of 2017E EBITDA (USD163m).

Russian real estate: stable; rent / occupancy stable Russian real estate 3Q17 rental income was USD80m (+3% YoY) with EBITDA margin stable 58%. Retail rents were unchanged QoQ (-6% YoY) and also office rents remained stable QoQ (-7% YoY). Retail occupancy (93%) has remained stable over last two years while office occupancy (79%) has started to show slight increase (74% in 4Q16). In 9M17, real estate revenue reached c.70% vs. 2017 DBe (USD330m) and c.60% of 2017E EBITDA (USD234m).

Energy business registered growth but FY should normalize given fix contract Energy business revenues of USD411m (+2% YoY) c.20% above our expectation, given fixed return business model, its EBITDA was within expectations (USD75m) with margin declining slightly to 18.2% (2Q17: 22.4%). In our view, quarterly volatility in energy business performance is not material as fixed off-take arrangement and cost pass through clauses ensure that EBITDA remains stable on yearly basis (c.USD283m).

Valuation at discount to EM peers; Maintain Hold 9M17 NP reached USD550m or c.75% of our full year 2017 estimate (DBe: USD730m. The stock is trading at a P/E of 8.6x 2017E, a discount to EM contractors: 9.1x / and discount to EM utility peers: 14.3x. Although we expect Russian real estate business starts to stabilize, we do not yet see triggers for growth given muted outlook for construction awards. Hold.



Rating

Buy Emerging Europe

Russia

Banking / Finance

Company

Moscow Exchange Alert

Date

9 November 2017

Results

3Q17 first look: results in line, good fees dynamics

Reuters Bloomberg Exchange Ticker MOEX.MM MOEX RX MCX MOEX

Price at 8 Nov 2017 (RUB) 127.05

Price Target (RUB) 185.00

52-week range (RUB) 138.50 - 97.58

Ivan Kachkovski, CFA

Research Analyst

(+44) 20 754-11735

[email protected]

Stock data

Price Target (RUB) 185.00

Market Cap (RUBm) 283,332.8

Market Cap (US$m) 4,790.0

Free float (%) –

Russian RTS Index 1,150.4


Fees expand nicely on a low base, while interest income still is a drag Net income reached RUB5.1bn (-18% YoY) in 3Q17, slightly above (1%) of consensus (compiled by the company), EBITDA of RUB7.1bn was in line with consensus. Fee income grew 15% YoY driven by equities (+45% YoY), bonds (+12%, money market (+31%), depositary and settlement fees (+21%) and derivatives (+5% YoY). FX market fees were down 6% YoY.

Net interest income expectedly dropped 16% YoY to RUB4.2bn as both rates and investment base are lower. In particular, the daily average of funds available for investment was RUB0.7trn in 3Q17 vs. RUB0.8trn in 3Q16 (-11% YoY). Opex grew 11% YoY and was 1% better vs consensus. The majority of the opex increase was driven by DD&A and equipment maintenance costs (up 19.2% YoY). Staff costs grew by only 3.0% YoY.

Figure 1: MOEX 3Q17 summary (RUBm)

3Q17 Cons vs cons 3Q16 YoYF&C income 5,458.5 5,485.0 0% 4,749.4 15%Net interest income 4,185.1 4,167.0 0% 5,000.0 - 16%Other operating income 13.6 11.0 24% 6.1 123%Gross revenue 9,657.2 9,688.0 0% 10,784.4 - 10%Operating expenses (3,306.2) (3,353.0) - 1% (2,980.4) 11%PBT 6,351.0 6,335.0 0% 7,804.0 - 19%Net profit 5,143.1 5,078.0 1% 6,289.8 - 18%EBITDA 7,096.1 7,112.0 0% 8,399.2 - 16%EBITDA margin 73.5% 73.4% 0.1% 77.9% - 4.4%

3Q17 Cons vs cons 3Q16 YoYF&C income 5,458.5 5,485.0 0% 4,749.4 15%

Equities 494.8 421.0 18% 341.0 45%Bonds 408.5 486.0 - 16% 363.4 12%Money market 1,560.1 1,613.0 - 3% 1,192.4 31%FX market 959.8 912.0 5% 1,016.7 - 6%Derivative market 494.5 500.0 - 1% 472.8 5%Depositary and settlement 1,083.4 1,025.0 6% 895.0 21%Other 457.4 400.0 14% 468.1 - 2%

Source: Company data, Deutsche Bank



Rating

Buy Emerging Europe

Greece

Telecoms

Company

OTE Alert Date

9 November 2017

Results

Q3 Rev & EBITDA broadly in line vs. Cons/DBe; Adj. FCF Outlook d/g

Reuters Bloomberg Exchange Ticker OTEr.AT HTO GA ATH OTEr

ADR Ticker ISIN HLTOY US4233253073

Price at 8 Nov 2017 (EUR) 10.75

Price Target (EUR) 12.90

52-week range (EUR) 11.10 - 7.98

Robert Grindle

Research Analyst

(+44) 20 754-58490

[email protected]

Keval Khiroya, CFA

Research Analyst

(+44) 20 754-18164

[email protected]

Stock data

Market Cap (EURm) 5,254.5

Market Cap (USDm) 6,086.6

Free float (%) 50

Athens General 742.0


Key data

FYE 12/31 2016A 2017E 2018E

Revenue (EURm)

3,908 3,885 3,892

Net Profit (EURm)

140 203 261

DB EPS (EUR 0.29 0.42 0.53

DPS (EUR 0.16 0.28 0.35

P/E (DB EPS) (x) 28.8 25.8 20.1


Q3 revenue in line and EBITDA slightly below vs. Cons/DBe. Adjusted FCF outlook downgraded OTE reported Q3 group revenues of €991m, in line with Bloomberg consensus (€989m) and DBe (€991m). Adjusted EBITDA at €349m was -0.8% below consensus (€352m) and -1.1% below DBe (€353m). Capex lower for the quarter at €176m, -8.5% below DBe (€193m). OpFCF of €173m, is 7.8% above DBe (€160m). Adj. FCF of €-28m was -3.1% below consensus (€-29m). Full year FCF guidance downgraded to c.€100m (Bloomberg consensus €214m, DBe €220m) reflecting increased capex to c.€800m (earlier c.€700m) and lower EBITDA in its international operations.

Divisional beats/misses Greek fixed revenues of €392m (-1.6% yoy, Q217 +0.3%, Q117 +3.5%) -2.7% vs. DBe and Adj. EBITDA of €166m (-3.0% yoy, Q217+0.8%, Q117 +4.3%) -5.8% vs. DBe. Greek mobile revenues of €323m (+1.6% yoy, Q217 +0.5%, Q117 -1.2%) +1.4% vs. DBe and Adj. EBITDA of €123m (+7.6% yoy, Q217 +3.0%, Q117 -5.4%) +5.5% vs. DBe. Romanian fixed revenues of €152m (+2.2% yoy, Q217 +1.4%, Q117 +4.6%) +2.0% vs. DBe and Adj. EBITDA was €29m (-1.7% yoy, Q217 +67.1%, Q117 +4.4%) +13.2% vs. DBe. Romanian mobile revenues were €111m (-0.9% yoy, Q217 -3.3%, Q117 -4.6%) +3.0% vs. DBe and Adj. EBITDA was €14m (-41.4% yoy, Q217 -36.7%, Q117 -14.2%), -10.3% vs. DBe. Albania mobile revenue was €18m (-7.2% yoy, Q217 -14.4%, Q117 -23.4%) +3.1% vs. DBe and Adj. EBITDA was €3m (-30.6% yoy, Q217 -60.4%, Q117 -81%) -34.9% vs. DBe.

KPIs – Domestic mobile better; Romania weak Domestic Fixed: PSTN net adds were -107k (Q217 -178k, Q117 -161k), ADSL net adds were +34k (Q217 -29k, Q117 +27k), IPTV net adds were +13k (Q217 -1k, Q117 +2k) and LLU net adds were -1k (Q217 +4k, Q117 +17k). Domestic Mobile: net adds were +130k (Q217 +4k, Q117 +23k). Romania Fixed: Fixed telephony net adds were -17k (Q217 -10k, Q117 -23k), Broadband net adds were +5k (Q217 +6k, Q117 -6k) and TV net adds were -5k (Q217 +13k, Q117 -7k). Romania Mobile: net adds were -47k (Q217 -150k, Q117 -294k). Albania mobile: net adds were +24k (Q217 +34k, Q117 -10k).

Conference call details The company will hold a conference call today at 5.00pm Greece time, (3.00pm GMT): 00800 4413 1378 / +44 (0) 1452 542 301. The call will also be accessible via a webcast on https://ote.irwebpage.com/conference_calls/.



9 November 2017

General Retailers

SA Company Results Diary

General IndustrialPeriodical

Sub-Saharan AfricaSouth Africa

Industry

SA CompanyResults Diary

Date9 November 2017

13-17 November 2017 (FY17: SPP;1H18: BAT, INL, MEI, VOD)Deutsche Bank forecasts for companies reporting results next week.

Date Company Rating Target price

1 Monday, 13 November 2017 Vodacom Group Ltd Buy R 166.00

2 Wednesday, 15 November 2017 Spar Group Ltd/The Hold R 167.00

3 Wednesday, 15 November 2017 Brait SE Buy R 64.00

4 Thursday, 16 November 2017 Mediclinic International Ltd Hold R 150.00

5 Thursday, 16 November 2017 Investec Ltd Buy R 110.00

Prices are as at Thursday, 9 November 2017; Source: Deutsche Bank

John Kim

Research Analyst

+27-11-775-7013

Sean Holmes

Research Analyst

+27-011-775-7292

Ryan Eichstadt

Research Analyst

+27-11-7757249

Stefan Swanepoel

Research Analyst

+27-11-775-7483

Caron Bramwell

Research Analyst

+27-11-775 7069

Marc Hammoud

Research Analyst

+971-0-4428-3910

Letlotlo Lenake

Research Analyst

+27-11-775-7299



9 November 2017

Retail

Lojas Renner

Rating

Hold

Valuation & Risks

RetailPrice at 8 Nov 2017 (BRL) 35.76

Target price 34.00

52-week range 37.60 - 21.35

ResultsLatin AmericaBrazil

Company

Lojas Renner


LREN3.SA LREN3 BZ SAO LREN3

Date9 November 2017

Updating estimates on 3Q17 results

Changes to financial services lead to 4% upward revision on TPWe update our estimates with Q3 results and raise our TP by 4% to R$34.0.Renner's retail business continues to face impressive expansion in operatingresults driven by accelerated roll-out of stores and increased sales productivity,most likely fully incorporated into our estimates. However, lower-than-expectedprovisioning for NPLs, recent changes to the credit policy, and the launch ofthe financial institution lead us to revise the 2018 contribution from financialservices to EBITDA and net earnings upwards 33% and 11%, respectively. As aresult, 2018 consolidated EBITDA and earnings were revised upwards 7% and6%, respectively.

Reiterate Hold ratingEven though Renner should be one of the best performing retailers in the Brazilianlandscape in 2017 and probably 2018, we believe that performance is fully pricedin (trading 2% above our target price), at 14.7x forward EV/EBITDA and 28.5xforward PE, 36% and 44% above historical averages, respectively, and 32-35%above Latam peers. The main upside risk to our investment thesis comes fromthe potential operating leverage once the accelerated growth cycle is over. Therewould be some downside risk to our estimates if the sales mix (which has not yetcontributed to gross margin expansion in 2017) continued on a similar trend, asassume gross margin to be up nearly 300bps in coming years due to enhancedinventory management (push-pull distribution).

Not much surprise from retail business' accelerated growth ratesGradual recovery in consumption, continued maturation of recently openedstores, market share gains driven by the attractiveness of fast fashion and homeimprovement stores, and healthy inventory levels pave the way for us to revise Q4and 2018 SSS upwards to 10.0% and 8.0%, respectively, from 8.0% and 7.0%.As a result, we raise the 2018 EBITDA of the retail business by 2%. As in 2017,when recurring EBITDA should be up 17% y/y (excluding extraordinary tax creditsfrom 2016 EBITDA), strong growth in sales productivity and accelerated roll-outof stores (selling space expected to expand 10% in 2018) should drive recurringEBITDA up 20% in 2018. Even though we remain constructive about Renner'stop-line growth in coming years, the risks associated with gross margin gains aremounting. Since the beginning of the year, gross margin was down 50bps y/y dueto increased sale of lower priced products. If not able to bring it back to the growthpath, it would probably put at risk our assumption that increased penetration of

Marcel Moraes

Research Analyst

+1-904-271-2470

Kaila Lopez

Research Associate

+1-904-645-1197

Key changes

TP 32.60 to 34.00 ↑ 4.3%

EPS (BRL) 0.98 to 1.08 ↑ 10.2%

Revenue(BRLm)

7,264 to 7,478 ↑ 2.9%



Lojas Renner BOVESPA (Rebased)

Jan '16 Jul '16 Jan '17 Jul '17

20

40

0


Absolute -3.4 19.0 43.7

BOVESPA -2.2 9.5 15.9Source: Deutsche Bank



Rating

Buy Global Emerging Markets

Brazil

Aviation

Company

Azul S.A. Date

9 November 2017

Results

Record Sep Q operating margin; raising 2017 forecast

Reuters Bloomberg Exchange Ticker AZUL.N AZUL US NYS AZUL

Forecasts And Ratios

Year End Dec 31 2015A 2016A 2017E 2018E 2019E

Revenue (BRLm) 6,258 6,670 7,641 8,971 10,603

EPS (BRL) -4.16 -0.18 1.03 1.41 1.89

P/E (x) – – 77.8 57.0 42.4

Source: Deutsche Bank estimates, company data

Record Sep Q margin; future margin growth points to more upside

Price at 8 Nov 2017 (USD) 24.65

Target price 31.00

52-week range 28.89 - 20.30

Michael Linenberg

Research Analyst

(+1) 212 250-9254

[email protected]

Catherine O-Brien

Research Analyst

(+1) 212 250-8949

[email protected]

Matt Fallon

Research Associate

(+1) 212 250-7161

[email protected]


20

22

24

26

28

30

4/17 10/17

Azul S.A.

BOVESPA (Rebased)


Absolute -12.7 -7.8 –

BOVESPA -2.2 9.5 15.9


Azul reported a Sep Q operating income of R$249 mm and margin of 12.5%, which was up 290 bps y-o-y and a Q'ly record for the company. Azul's fundamentals looked strong in the Sep Q with higher avg. fares (+7.6%), all time high load factor (+2.1 pp. to 83.1%) and solid unit revenue growth of 1.5%. The company will also benefit from the induction of additional A320neos which will reduce CASK ex-fuel by 29.0%. Futhermore, TudoAzul is expected to drive additional margin growth. All of these factors combined with an improving Brazilian macroeconomic backdrop point to further margin expansion; Buy.

Induction of additional A320neos will reduce CASK ex-fuel Azul remains well positioned for margin expansion going forward – both from company specific initiatives as well as an improving Brazilian and Latin American economic backdrop. Management expect the induction of additional A320neo aircraft to reduce CASK ex-fuel by 29.0%. Azul will add 7 new A320neos between November and January for Brazilian high season. The A320neo will account for 14.0% of system ASKs by YE 2017, 27.0% in 2018, 35.0% in 2019 and 41.0% in 2020. Management expect CASK ex-fuel to be negative for the “next couple of years.”

TudoAzul’s growth potential supports Azul’s path to margin expansion TudoAzul could easily add at least one point of margin in 2017 - 2018 as the company (which is 100.0% owned by Azul) grew gross billings (LTM ex-airline) by 47.4% in the Sep Q. Azul has 25.0% share of total airline revenue in Brazil while TudoAzul has 15.0% of gross billings in Brazil, pointing to further growth opportunities for the high margin, wholly-owned subsidiary.

Raising our 2017 forecast We are raising our 2017 EPADS forecast from $0.55 to $0.98 (vs. consensus of $0.45) to reflect the Sep Q beat.

Valuation and risks Our 12-month price target for AZUL shares (ADS) is $31. Our PT is derived by applying a EV/EBITDAR multiple of 8.0x to our 2018 EBITDAR forecast. Historically, Latin American airline stocks have traded 6x – 8x forward EBITDAR when the economic backdrop has been sound, but higher during periods with a weaker backdrop (such as now) to reflect depressed earnings/EBITDAR. Fuel price volatility is a key risk. For more, see Page 4.



Rating

Buy Global Emerging Markets

Brazil

Aviation

Company

Azul S.A. Alert Date

9 November 2017

Results

Better-than-expected Sep Q results

Reuters Bloomberg Exchange Ticker AZUL.N AZUL US NYS AZUL

Price at 8 Nov 2017 (USD) 24.65

Target price 31.00

52-week range 28.89 - 20.30

Michael Linenberg

Research Analyst

(+1) 212 250-9254

[email protected]

Catherine O-Brien

Research Analyst

(+1) 212 250-8949

[email protected]

Matt Fallon

Research Associate

(+1) 212 250-7161

[email protected]

Stock data

Market cap (USDm) 7,745.2

Shares outstanding (m) 314.2

ADR ratio 0.0

Free float (%) 100

Volume (8 Nov 2017) 109,971

BOVESPA 74,363

Exchange rate (BRL/USD} 3.25


Key data

FYE 12/31 2016A 2017E 2018E

Revenue (BRLm) 6,670 7,590 8,964

EBITDA (BRLm) 730 1,057 1,342

EBITDA margin (%)

10.9 13.9 15.0

Net Income (BRLm)

-42 146 442

EPS (BRL) -0.18 0.53 1.41

Div Yield (%) – 0.0 0.0


Azul reported a Sep Q operating profit of R$249 million and margin of 12.5% (up 290 basis points y-o-y), ahead of our forecasts of R$233 million and 11.5%, respectively. The company reported net income of R$204 million, well ahead of our forecast of R$86 million. This represents an EPADS of $0.59, higher than our forecast of $0.25 and the consensus of $0.11. The company maintained its FY 2017 operating margin guidance of 9.0% - 11.0% (vs. our 9.8% for 2017).

Total operating revenue for the Q was R$2.0 billion, up 15.0% y-o-y and essentially in-line with our forecast. Passenger unit revenue (PRASK) increased 1.3%, driven entirely by a 2.1 point increase in load factor to 83.1%, partially offset by a 1.2% decrease in yield. RASK was up 1.5% boosted by higher passenger revenue in addition to higher ancillary and cargo revenue. Unit costs (CASK) ex-fuel decreased 1.1%; the result was better than our estimated decrease of 0.6%.

Along with its FY 2017 operating margin guidance of 9.0% - 11.0%, Azul also reiterated its 2017 capacity and departures guidance calling for increases of 11% to 13% and 1% to 2% y-o-y, respectively. The company also continues to expect CASK ex fuel to be down 3.5% to 5.5% y-o-y.

At quarter end, Azul’s total cash position was R$3.1 billion, 41.5% of LTM revenue, and up from R$3.0 billion last Q.

We will have more details following Azul’s 9:00 A.M. (Eastern) conference call



9 November 2017

Banking / Finance

Banco do Brasil

Rating

Buy

Valuation & Risks

Banking / FinancePrice at 8 Nov 2017 (BRL) 33.11

Target price 39.00

52-week range 37.56 - 23.76

ResultsLatin AmericaBrazil

Company

Banco do Brasil


BBAS3.SA BBAS3 BS SAO BBAS3

Date9 November 2017

3Q17 recovery appears on track

Key takeaway: Bottom line miss, but operating trends in-lineReported net income of R$2.8bn was 1% below DBe, but included a one-timegain of R$133mn mostly related to Neoenergia and IRB. Recurring net incomeof R$2.7bn rose 2% qoq (+16% yoy), but was 6% below DBe and 4% belowconsensus. The weaker than expected result was mainly due to higher otherexpenses related to civil claims and a drop in other operating income, which waspartly offset by a lower tax rate of 24% vs. 36% in 2Q17 and DBe of 36%. Infact, earnings before taxes fell 9% qoq (+9% yoy) and were 19% below DBe.Meanwhile, recurring ROE remained relatively stable at 11.8% vs. 11.7% in 2Q17and 11.0% in 3Q16. Operating trends were mostly in-line, as tight cost control,healthy fees, and lower provisions offset still weak loan growth and lower NIM.

Positives: Asset quality, fees, expenses, and capitalThe NPL ratio fell 20bps to 3.9%, as better corporate NPLs (-70bps) offset higherconsumer (+20bps) and agribusiness (+20bps) NPLs. As such, provisions fell 6%qoq (-6% yoy) and were 3% below DBe with the cost of risk falling to 3.9% from4.2% last quarter. Meanwhile, expenses remained under control, rising 1% qoq,but down 6% yoy and 1% below DBe, due to lower personnel expenses (-3% qoq,-11% yoy), given the 9% reduction in employees over the last year. Fee incomewas also healthy, rising 4% qoq (+9% yoy) and 1% above DBe, driven by stronggrowth in asset management (+6% qoq, +27% yoy) and checking account (+4%qoq, +11% yoy) fees. Furthermore, the fully loaded CET1 ratio reached 9.5% from9.1% last quarter and already reached management's 2019 target. Finally, thecompany announced that it will sell its entire stake in Neoenergia, which we thinkcan boost the CET1 ratio by another 10-20bps.

Negatives: Still weak loan growth and lower NIMLoans fell 2% qoq (-6% yoy), 2% below DBe, due to continued weakness in SME(-10% qoq, -31% yoy) and corporate (flat qoq, -7% yoy) loans, as well as a drop inforeign (-5% qoq, -22% yoy) and agribusiness (-4% qoq, +1% yoy) loans, whichoffset a slight pick-up in individual loans (+1% qoq, +1% yoy). Meanwhile, NIMfell 20bps qoq to 4.5% given lower interest rates, which offset a 10bps increasein loan NIMs. As such, net interest income fell 2% qoq (-6% yoy), 3% below DBe.

Maintain Buy on earnings recovery and discount valuationWhile the bottom line was not "great," we think the earnings recovery is on trackand the stock continues to trade at a discount at 7.2x '18E P/E.

Tito Labarta

Research Analyst

+1-212-250-5944


Banco do Brasil BOVESPA (Rebased)

Jan '16 Jul '16 Jan '17 Jul '17

20

40

0


Absolute -10.5 5.6 17.1

BOVESPA -2.2 9.5 15.9Source: Deutsche Bank

Key indicators (FY1)

ROE (%) 12.1

ROA (%) 0.7

Equity/assets (%) 6.3

Dividend yield (%) 3.1

P/BV (x) 1.0

P/E (x) 8.6Source: Deutsche Bank



9 November 2017

Exchange

Bolsa Mexicana

Rating

Buy

Valuation & Risks

Banking / FinanceExchange

Price at 8 Nov 2017 (MXN) 32.43

Target price (MXN) 45.00

52-week range (MXN) 34.02 - 26.91

ResultsLatin AmericaMexico

Company

Bolsa Mexicana


BOLSAA.MX BOLSAA MM MEX BOLSAA

Date9 November 2017

October volume trends running aheadof our 4Q17 forecastEquity volumes up, derivatives volumes and debt listings downBolsa Mexicana released operating data for October, showing a pick up in equityvolumes, offset by a sharp decline in derivatives volumes following a spikein September. Nonetheless, October volumes are running well ahead of ourforecasts for 4Q17. Meanwhile, there was one Fibra listing in October and totaldebt listings dipped in the month, but are still up on a yearly basis.

Equity volumes rally for a second month in a rowEquity ADTV rose for the second consecutive month, rising 26% mom (+23% yoy)to Ps15.9bn, as global market volumes spiked 33% mom (+67% yoy) and localmarket volumes rose a strong 22% mom (+6% yoy). For the quarter, volumes arerunning 16% above DBe of Ps13.7bn.

Derivative volumes fell after rebounding in SeptemberMexDer ADTV fell 25% mom to 47.6k contracts after spiking 103% mom to 63.2kcontracts in September. Nonetheless, derivative volumes are still up 2% yoy andare running 13% above our forecast of 42.1k contracts for the quarter. The declinein October was mainly due to a drop in futures volumes (-49% mom, +39% yoy),which offset an increase in 28-day TIIE swaps (+51% mom, -21% yoy).

Debt listings dipped slightly, but one Fibra listingThere were no equity listings in the month, following one in September raisingPs4.6bn, but there was one Fibra listing for Ps12.8bn (+178% mom). Meanwhile,total debt listings fell 4% mom to Ps74.2bn, but were still up 9% from last year,as there were 29 medium & long term listings (+45% mom, +52% yoy) and 75short term listings (+19% mom, +3% yoy) in October.

Maintain Buy on discount valuationWhile October operating results were somewhat mixed, volumes for the quarterare still running above expectations, and we continue to like the long-termoutlook. We also think the threat of competition is manageable. Furthermore,we note valuation is attractive at 15.9x '18E P/E vs. global peers at 21.7x. OurPs45/share PT is derived using DCF analysis with 12.1% COE, 14.0% WACC, and6% terminal growth rate. Main downside risks include further declines in equityand derivatives volumes, limits on equity investments at the Afores, increasedfinancing costs from Indeval payment, and potential competition.

Tito Labarta

Research Analyst

+1-212-250-5944


Bolsa Mexicana Mexico IPC Index (Rebased)

Jan '16 Jul '16 Jan '17 Jul '1720

30

40


Absolute 5.4 3.9 8.3

Mexico IPC Index -2.9 -4.9 0.8Source: Deutsche Bank

Key indicators (FY1)

ROE (%) 19.5

ROA (%) 15.6

Equity/assets (%) 80.0

Dividend yield (%) 3.85

P/BV (x) –

P/E (x) 16.7Source: Deutsche Bank



Emerging Markets Argentina

HY Corporate Credit Energy

Company

YPF Sociedad Anonima

Date 7 November 2017

3Q17: Weak Quarter Came in Above Our Ests.; Positioned for a Better 4Q

Xavier Olave

Research Analyst

(+1) 212 250-6135

[email protected]

Eduardo Vieira

Research Analyst

(+1) 212 250-7568

[email protected]

My Bui

Research Associate

(+1) 212 250-5725

[email protected]

In a weak quarter, consistent with our expectations given FX pressure, results held up better than our forecast as upstream production cash costs were pulled back and refining margins held-up relatively well despite the FX hit; Given fuel price increases post liberalization of downstream prices we expect results to improve starting in the fourth quarter In 3Q17, the average ARS:USD rate increased by 10%, while during the quarter fuel prices increased by 6%-7% (a catch-up from the prior quarter’s currency depreciation). YPF’s adjusted EBITDA of USD986mn came in 12% better than our estimate; on a local currency basis it came in ~8% better than Bloomberg consensus (revenues were in-line). Positively, the company saw improved gasoline and diesel demand (+3% qoq sales for a second consecutive quarter), which partially offset lower volumes in other petroleum products and FX-related pricing pressure. The Gas & Energy segment, was once again a positive surprise on the back of higher regulated tariffs. In our view the trajectory of the company’s cash flow generation going forward will be driven by more favorable downstream pricing policies (more pricing visibility) now that fuel prices have been liberalized.

Upstream production recovered slightly from the 2Q trough as it slowly perks up from weather-related constraints and natural declination; company ramping up shift to unconventional Total upstream production of 553.2k boed increased by 0.6% qoq (-4.5% yoy); realized crude oil prices of USD51.4/bbl were down -2% qoq (-14% yoy), as prices converge to Brent. Crude oil production increased by 4% qoq, which more than offset natural gas production declines (-1.1% qoq); the company’s shale production grew by 11% yoy as the company is shifting its production efforts towards non-conventional resource development/production. After a brief uptick in 2Q, upstream unit cash costs declined by -4% sequentially to USD20.9/boe, on higher production and slightly lower than expected royalties.

Downstream segment margins held up despite pricing not keeping up with quarterly depreciation of the ARS; contribution from Gas/Electric segment increased once again this quarter (a trend which should continue) Downstream EBITDA margins of 9% came in slightly lower than 10% in 2Q17 (+4% in 3Q16), on the back of better gasoline/diesel volumes as price increases of 6%/7% were only a catch-up of the prior quarter’s ARS depreciation; the catch-up for the 3Q FX depreciation did not take place until early October (post-Congressional elections fuel prices increased by 10% and prices have now been liberalized). For this reason we expect 4Q results to show a notable sequential improvement versus 3Q17. The Gas and Energy segment continues to benefit from tariff increases (+30% qoq EBITDA growth) at the gas distribution business (Metrogas), and we expect contributions from regulated businesses to increase going forward.

YPF generated negative FCF in the quarter on an uptick in capex and working capital burn; leverage metrics remain strong for the rating category and should improve in the fourth quarter In the quarter, the company reported FCF of –USD444mn (double 2Q’s FCF burn) as capex increased by +13% qoq (though still in guidance range) and working capital pressured operating cash flow (higher accounts receivable from Gas Plan, Gas Utilities, Cammesa). Leverage metrics ticked up on the FCF burn (Net Debt increased 4% qoq) but remained strong at LTM net leverage of 2.1x (versus 2.0x in 2Q17; should go down in 4Q17 on higher EBITDA generation). The company’s liquidity cushion is solid at 1.2x its ST Debt.

We rate YPF’s ’24 and ’25 bonds a Buy (Hold on ’18, ’21, and ‘27 notes) due to the company’s solid stand-alone credit profile (low leverage vs. regional SOE’s), its position as a key strategic asset for the Argentine state, and outsized yields and spread to sovereign (relative to leverage).

YPF’s key negative risks are a halt to downstream price adjustments matching inflation / currency depreciation, and an end to attractive natural gas pricing. Key positive risks include the ability to increase domestic fuel prices in 2017 to more than match FX depreciation/inflation plus substantial asset sale proceeds.



North America

United States

Industrials

Metals & Mining

Periodical

Metals & Mining Alert

Date

9 November 2017

Periodical

Daily prices and news: Gold demand declines to 8-year low in 3Q17

Jorge Beristain, CFA Chris Terry

Research Analyst Research Analyst

(+1) 203 863-2381 (+1) 212 250-5434

[email protected] [email protected]

Jeremy Kliewer Sathish Kasinathan

Research Associate Research Associate

(+1) 904 527-6532 (+1) 203 863-2358

[email protected] [email protected]

Corinne Blanchard

Research Associate

(+1) 904 645-2360

[email protected]

Focus stocks

Barrick (ABX.N),USD13.99 Buy Price Target USD19.00

Nucor (NUE.N),USD57.70 Buy Price Target USD70.00

Pan American Silver (PAAS.OQ),USD16.00 Buy Price Target USD20.00

Reliance Steel & Alum. (RS.N),USD77.19 Buy Price Target USD95.00

Teck (TECK.N),USD21.84 Buy Price Target USD26.00

Vale (VALE.N),USD10.39 Buy Price Target USD12.00


Price performance %WTD %YTD

3M LME aluminum -3.5% 24.6%

3M LME copper -0.6% 23.8%

3M LME lead 1.8% 24.3%

3M LME molybdenum 0.0% 5.0%

3M LME nickel -0.2% 26.7%

3M LME zinc -0.8% 23.9%

Comex gold 0.9% 11.2%

Comex silver 1.2% 7.1%

China HRC 0.6% 11.4%

SHFE rebar 1.7% 34.4%

Iron ore (62% Fe) 4.0% -21.1%

Coking coal, FOB Aus 0.4% -20.1%

Freight (BCI) 7.3% 135.3%

Brent 2.3% 11.7%

WTI 2.1% 5.8%

Natgas 6.4% -14.7%

Thermal (Newcastle) -1.0% 10.9%

Industrials (/lb): aluminum $0.96 (-1.1%), copper $3.11 (+0.4%), lead $1.14 (+0.4%), molybdenum $7.14 (+0.0%); nickel $5.76 (+0.4%); zinc $1.45 (+0.8%); Precious (/oz): gold $1,281 (+0.5%), silver $17.04 (+0.5%); Steel (/mt): China HRC $619 (-0.2%), SHFE Rebar $564 (-0.4%), MB Scrap Index $302 (+0.0%); Bulks: iron ore (/dmt) $62 (-0.6%), coking coal (/mt) $181 (+0.0%), freight (BCI) 3,259 (+5.1%); Energy: Brent (/bbl) $63.49 (-0.3%), WTI (/bbl) $56.81 (-0.7%), natural gas (/mmBtu) $3.18 (+0.7%), thermal coal (/t) $98 (-0.5%).

Global gold demand declines to 8-year low of 915 tons in 3Q17 (-9% YoY). YTD (thru September) demand decreased 12%. ETF inflows grew by only 18.9t (vs. 144t in 3Q16), as global equity markets outperformed. Jewelry demand fell 3% YoY to 479t, mainly driven by a decline in Indian demand (-25% YoY), due to the new tax regime and tighter regulation around jewelry transactions. Chinese jewellery demand rose 13% YoY to 159t. YTD jewelry demand rose 3% to 1,457t. Total bar and coin demand rose 17% YoY to 222t, but was soft compared to long-term average levels. Central bank purchases rose 25% YoY to 111t. Total supply was down 2% to 1,146t, with mine production declining 1% to 841t. (World Gold Council)

China’s passenger-vehicle sales rose for sixth consecutive month in October. Retail sales of cars, SUV’s and multipurpose vehicles increased 2.7% to 2.3m units. YTD (thru October), deliveries rose 1.4% YoY to 18.9m units. Chinese car sales have picked up in recent months as automakers offered large discounts and introduced new products to entice customers, who were slightly deterred by the increase of a sales tax by the government. (Bloomberg Finance LP)

US pig iron imports on track to reach a 10-year high in 2017. 9M17 imports totaled 3.9mt (+19% YoY) and surpassed the 2016 total of 3.87mt. 2017 total expected to reach 5.2mt. YTD imports from Ukraine are up 44% YoY, followed by Russia (+19%) and Brazil (+5%). Pig iron has been an attractive raw material for EAF based sheet mills this year due to higher prime scrap prices. (SBB)

US Hot-Rolled Coil (HRC) spot price rose $11/st WoW to $604/st. Spread between HR and Cold-Rolled coil contracted $13/st WoW to $184/st. Separately, NYMEX December 2017 forward HRC price slid $3/st WoW to $627/st on 11/8. (CRU, CME)

Vale confirms it has received bids for its VNC nickel operation. Company had said in September that it was looking for new partners in the mine as it was reevaluating its nickel business amid low prices. VNC has been loss making and Vale has decided to not invest in further development at current prices. VNC produced 34kt in 2016 (~11% of its total nickel output). (Reuters)



EM Monthly - Emerging Markets and the Global Economy in the Month Ahead We maintain our late summer "half-empty" view of

emerging markets while reaffirming ourconstructive view on emerging economies. EMGDP growth continued to impress, while inflationstill largely remains in-check. This limits downside.

But year-end protection of gains and insufficientrepricing of US rates in the face of peaking liquidityconditions and a likely less favorable balance ofsupply and demand for global fixed income as wemove into 2018 underlie our still cautious tone.

With the notable exception of CBT, most EM CBshave room to be patient in the coming months.Although we don’t expect Banxico to hike, itappears to have reaffirmed the subordination ofmonetary policy to FX. The fate of the peso andshort-end rates will remain closely linked.

Although politics remain a source of concern

(especially in Mexico, South Africa, Turkey,

Colombia, and Brazil) and a likely boost in the

cases of Argentina and Chile, in Russia and

Venezuela is where event risks are highest.

We see recent weakness as providing better entrylevels for currencies such as BRL and RUB withstrong BoP and high real rates. MXN and ZARremain most vulnerable to event risks while ILSseems too strong and subject to intervention.

We continue to favour North Asia vs. South AsiaFX on relative betas to growth and UST and THBand MYR within South Asia.

EM local curves are optically steep when comparedwith core curves, but a decomposition of slopesinto monetary policy and risk premiumcomponents reveal limited premium across mostcurves. Keep short-end receivers in Brazil,Colombia, and Russia (with a bull steepening bias).Underweight duration in Korea, Singapore andThailand vs. a small long Indonesia. Holdsteepeners in both India and Korea and swapspread payers in Singapore but CNH CCSflatteners.

We expect credit to be more resilient than localmarkets and believe that Venezuela’s apparentchange in debt policy should have limited impacton the broad EM credit market. OverweightArgentina, Ecuador, Malaysia, and Mongolia;underweight Poland, Hungary, and Sri Lanka.

In relative value, we favour cash curve flattenersand long CDS/bond basis in select names. EnterEgypt 47s vs. 28s, Brazil 26s vs. 5Y CDS, Turkey26s vs. 5Y CDS, and Colombia 27s vs. 10Y CDS.Maintain South Africa 27s vs. 22s, PETBRA 26s vs.23s. Hold long Argentina USD Pars, EUR 28s andEUR Warrants, and sell PDVSA 20s.

Threading the needle

Policymakers face an increasingly difficult balancing act in the months ahead. This is especially challenging in the US, where output gaps have narrowed and balance sheet unwinding may be combined with increased deficit and thus issuance. Other major central banks have more leeway, but historically they have tended to move together. EM has largely benefited from extended accommodation and a gradual turn remains our baseline on the view that inflation pressures will stay subdued. But reduced room for error still bodes for caution, in our view.

We expect market volatility to continue to cloud an otherwise supportive growth backdrop for both EM and DM. EM export volumes growth remain near double-digit levels, growth “momentum” indicators continue to point up – most notably in LatAm, and PMIs still have room to catch up with already more upbeat DM surveys. Leverage and credit growth will remain a headwind, but inflation expectations at historical lows bide monetary authorities time to react.

Positioning and the tendency to preserve gains at this time of the year will likely continue to weigh on EM assets. Although foreign positioning has not recovered to the levels pre-tantrum and external vulnerabilities have been reduced since, EM intrinsic value is also reduced. EM inflows are strongest when EM growth is strongest, but – in comparison to 2010-13 – the growth pick-up over DM now is a lot less. The leveraging – especially across emerging middle class – of those years has yet to be fully digested. Real credit growth is near flat in EMEA and LatAm and it is finally decelerating in Asia.

No support from the UST and USD. Our rates strategists expect UST 10Y yields to continue the grind up – now to 2.60% by year-end, which may trigger further USD strength in coming months. With uncertainty about the Fed resolved in favor of continuity (assuming Powell will be approved), tax reform is the main near-term risk for EM stemming from US yields and the USD. Still, a diluted version of the bill is likely to have only a moderate impact on r* and the term-structure. Assuming half the fiscal deficit of the full plan our economists estimate r* would rise by about 40bp by the end of 2020 (chart) – a result consistent with the one obtained via the FRBUS model.

Despite market jitters, risks to US growth also seem contained. DB has recently upgraded its US growth forecast in H2 to 2.75%. Growth is broadening with strengthening inputs from capex and net exports despite hikes – more evidence that rates are below r*. Also, despite some signs of weakness in low-income



European Equity StrategyWolf von Rotberg +44-20754-52801; Sebastian Raedler +44-20754-18169;Thomas Pearce, CFA +44-20754-16568; Andreas Bruckner +44-20754-18171

9 November 2017

• The 2017 earnings recovery continues to normalize: Following the broad-based earnings surge in Q1 (with year-on-year EPS growthat 26%) and the financials-driven beat in Q2 (with growth at 18%), Stoxx 600 EPS growth has slowed to 7.6% in Q3, with 78% ofcompanies having reported. This result is in line with the 5% to 10% range of consensus expectations ahead of the quarter. At 51%, the

gross beat ratio is at the lowest since Q4 2015, as euro strength has offset the positive impact from a strong growth backdrop during thequarter. Euro strength also explains the fact that those Euro area companies which generate a majority of their revenues domestically(>70%) have managed to beat expectations comfortably (59% gross beats), while exporters (>70% of revenues outside the Eurozone)

have seen their beat ratio drop below 50% for the first time since Q4 2016. As mentioned in our previous note, past euro strength willlikely remain a drag in Q4 with FX hedges continuing to roll off.

• Banks appear visually strong, but beat quality is low: among sectors, banks have enjoyed the highest beat ratio in Q3, with 74% of

reports coming in ahead of consensus expectations. This, however, has failed to translate into an above-expectations earnings growth,given that: a) the beat size for banks has generally been modest; and b) the modest positive surprises have partly been offset by a fewlarge misses (e.g. Barclays). Furthermore, the quality of bank beats is low, as they have largely been driven by a reduction in provisions

(e.g. ABN Amro, Danske Bank, ING, Santander, Unicredit) and lower costs (ABN Amro, Unicredit, RBS), while hopes for a morefundamental NII improvement have not been met.

• Energy delivers strong results: Energy companies have been the key driver behind earnings growth in Q3, accounting for more thanhalf of Stoxx 600 EPS growth and comfortably beating expectations, even though these were demanding going into the season. Sectorearnings have been positive across business units. Upstream results have benefitted from a continued focus on costs (with BP and

Shell indicating that their breakeven price has fallen below $50/bbl). This should continue to provide support for energy earnings overthe coming quarters, barring a sharp drop in the oil price. Refining margins were unusually strong in the downstream business, due tothe impact of hurricane-related disruptions on US refineries (benefitting BP, Shell and Total, among others).

European Equity Strategy - Q3 earnings: growth slows to single-digits, as FX strength weighs



9 November 2017

EMEA Snap

Emerging EuropeCzech RepublicHungary

Economics

EMEA SnapDate9 November 2017

Hungary and Czech Republic: Divergent

Hungary: headline and core both down in OctoberAnnual headline decelerated by 0.3pps to 2.2% YoY in October, despite theacceleration in monthly terms, as base effects continue to be positive. In monthlyterms, prices increased by 0.3% MoM, the highest in six months. Food inflationemerged as the sole major contributor to higher prices on the month, as it jumpedto 0.5% MoM, ending a three month streak in the negative territory. A numberof food categories posted monthly increase in prices with fruits/vegetables pricesregistering the largest jump. The monthly increase in food prices led to anacceleration in food price in annual terms as well (3.3%YoY vs. 3.1% previous),however this increase was overshadowed by the fall in inflation in the motor fuels/oils component (1.3% YoY vs. 5.3% previous) and in services inflation (1.6% YoYvs. 1.8% previous).

Figure 1: Hungary local measuresof core inflation

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Oct-12 Oct-13 Oct-14 Oct-15 Oct-16 Oct-17

Core ex indirect taxes

Demand sensitive inflation

Sticky price inflation

% YoY

Source: CSO, Haver Analytics, Deutsche Bank

Figure 2: Czechia: local measures ofcore inflation

-2

0

2

4

6

-2

0

2

4

6

Oct-12 Oct-13 Oct-14 Oct-15 Oct-16 Oct-17

% YoYHeadline CPI

Monetary policy relevant inflation

Adjusted inflation ex fuels

Core CPI

Source: CSO, Haver Analytics, Deutsche Bank

All annual core indicators followed by the National Bank of Hungary (NBH)displayed a decline in October, supporting the Bank’s long-standing expectationthat reduced social contribution by employers and lower corporate income taxare helping keep upside pressure from cost-wage pressure in check.

We expect headline CPI to decelerate back to close to 2% levels in the rest of theyear thanks to positive base effects. Inflation is likely to start accelerating oncemore from March-2018 onwards as on back of higher pressures from domesticdemand, but is expected to remain below the 3% target until 2019.

DB assessment: The MPC looks ready to ease monetary conditions furthervia liquidity tools in the coming months, i.e. via the stock and maturity ofswap instruments. The Minutes of October meeting confirmed such bias givenpolicy-setters’ consensus on the need for reducing long-term yields to safeguardfinancial stability as well as lengthy discussions over availability of a wide rangeof tools to achieve this. While a further decline in the lower band (i.e. O/N depositrate) cannot be ruled out given the Council’s ever-rising easing bias, the Octoberstatement and Minutes hint the focus has moved to the liquidity instruments,perhaps towards a new IRS swap facility. The steepness of the yield curve will beimportant to watch from here given the Bank's fledgling aim to loosen conditionsup to the longest possible section of the curve. Further limited compression inthe 3M BUBOR rate seems less likely in the near term, particularly in absence ofanother cut in O/N deposit rate. We still think a gradual rise in 3M BUBOR ratecould be possible starting in H2 2018, i.e. after general elections are out of theway and headline inflation starts converging to the 3% target in a consistent way.In the meantime, however, we would not be surprised to see new unorthodox

Kubilay Ozturk

Chief Economist

+90-212-3170124

Carlos Galindo

Research Analyst

+44-207-547-6269

Twisha Roy

Research Associate



10 November 2017



Economic Calendar Country GMT Release DB Expected Actual Consensus Previous

Thursday, 09 November

BR 07:00 FGV CPI IPC-S (Nov) 0.35% 0.33%

BR 07:00 FGV Inflation IGP- DI (Oct) 0.10% 0.62%

TR 07:00 Industrial production (Sep) -5.20%

CL 08:00 CPI (Oct) 0.2% (1.5%) -0.2% (1.5%)

HU 08:00 Merchandise trade balance(prelim) (Sep), EUR, m EUR303.0m

CZ 08:00 Unemployment rate (Oct) 3.8%rate

CZ 09:00 CNB FX reserves (Oct), USD, bn USD146.3bn

PL 11:00 MPC meeting (Nov) 1.50%rate 1.50%rate 1.50%rate

RU 13:00 Weekly CPI (Nov) 0.00%

UA 14:34* CPI (Oct) 2.0% (16.4%)

UA 14:35* PPI (Oct) -22.40%

Thursday, 09 November

EG 05:44* CPI (Oct) 0.7% (30.3%) 1.0% (31.6%)

RO 07:00 Merchandise trade balance (Sep), EUR, bn -EUR1,059.70bn

CZ 08:00 CPI (Oct) 0.4% (2.8%) -0.1% (2.7%)

HU 08:00 CPI (Oct), nsa 0.3% (2.3%) 0.1% (2.5%)

HU 08:00 Core inflation excluding indirect taxes (Oct) -2.60%

EG 10:00* Industrial production (Sep) -17.00% -23.80%

MX 11:00 CPI (Oct) 0.60% (6.30%) 0.31% (6.35%)

MX 11:00 Core CPI (Oct) 0.28%

ZA 11:00 Manufacturing production (Sep), nsa -1.50%

TR 12:00* CBT FX reserves (Nov), USD, bn USD95.5bn

PE 12:00* Trade Balance (Sep), USD, m USD350.0m USD371.0m

RU 13:00 CBR FX reserves (Nov), USD, bn USD425.5bn

US 13:30 Continuing Claims (Oct), k 1,884.0k

US 13:30 Initial Jobless Claims (Nov), k 231.0k 229.0k

US 15:00 Wholesale Inventories (Sep), sa 0.50% 0.30% 0.3% (4.5%)

Friday, 10 November

BR 04:00 FIPE CPI weekly (Nov)

RO 07:00 CPI (Oct) 0.5% (1.8%)

BR 08:00 IBGE Inflation IPCA (Oct) 0.45% (2.73%) 0.16% (2.54%)

RU 08:00 Money supply (Nov), RUB, tr, chg RUB9.3tr

MX 11:00 Industrial Production (Sep) (-1.0%) (-0.5%)

KZ 12:00* Industrial production (Oct)* -6.90%

PL 13:00 Merchandise trade balance (Sep), EUR, m EUR298.0m

RU 13:00 Merchandise trade balance (Sep), USD, bn USD6.6bn

US 15:00 Consumer Sentiment prelim (Nov), Index 94 100.7

US 19:00 Treasury Budget Balance (Oct), USD, bn USD8.0bn

Monday, 13 November

RO 07:00 Current account balance (Sep), EUR, m -EUR4,043.0m

TR 07:00 Current account balance (Sep), USD, bn -USD4.90bn -USD1.24bn

RO 07:00 Industrial production (Sep) -9.80%

HU 08:00 Construction (Sep), nsa -36.80%

HU 08:00 Industrial production(final) (Sep), wda -6.80%

CZ 09:00 Current account balance(and BoP) (Sep), CZK, bn -CZK8.1bn

IL 11:00 Merchandise trade balance (Oct), USD, m -USD1,572.0m

BR 12:00* Tax Collections (Oct), BRL, m BRL110.0m BRL105,595.0m

PL 13:00 CPI (Oct), nsa 0.4% (2.1%) 0.4% (2.2%)

PL 13:00 Current account balance(and BoP) (Oct), EUR, m -EUR100.0m


10 November 2017



Indices Region/Country Index Price local Vol ($m) Price Performance in %($ Terms)

9-Nov-17 1D 1 W 1 M Ytd 3 Y 5 Y 10 Y

EM MSCI EMF 60,781.65 na 0.0 0.7 3.0 27.6 25.2 37.3 16.0

EMEA MSCI EMEA 541.26 na 0.0 1.3 3.8 10.7 11.7 24.7 3.4

LatAm MSCI LatAm 83,305.33 na -1.2 -0.6 -2.9 15.8 18.6 17.1 7.5

Asia MSCI Asia 926.89 na 0.1 0.9 3.8 33.9 30.7 47.7 24.5

CEEMA

Czech Republic PX 1,060.53 23 1.2 -0.1 0.6 34.8 11.0 -1.4 -52.2

Greece ASE 741.13 52 0.3 -2.9 -2.0 27.5 -23.9 -15.3 -88.6

Hungary BSE 40,273.66 98 0.8 -0.1 4.9 38.2 117.8 75.8 -3.4

Israel TA-25 1,414.24 421 -1.0 -1.4 -2.7 4.9 5.3 29.8 29.0

Poland WIG 63,923.62 250 -0.7 -0.9 -0.6 42.0 11.9 33.0 -25.2

Russia RTS$ 1,161.38 1046 1.0 3.8 2.6 0.8 15.3 -16.9 -48.7

Turkey ISE 100 110,246.46 1975 -1.8 -4.2 4.5 28.3 -17.6 -29.1 -36.5

Bahrain BHSEASI 1,267.58 1 0.1 -1.2 -0.4 3.9 -12.1 18.6 -52.6

Egypt CASE 14,350.14 56 1.0 0.2 2.7 20.0 -37.9 -11.4 -51.3

Jordan ASEGI 2,082.81 4 0.1 -1.4 -0.7 -4.0 -1.0 7.6 -39.5

Kuwait KWSEIDX 6,258.47 62 1.3 -4.5 -6.1 10.1 -16.4 1.0 -54.7

Oman MSM30 5,055.24 133 0.5 0.3 -2.2 -12.6 -27.0 -11.5 -38.6

Qatar DSM20 7,885.50 29 0.4 -3.2 -4.0 -24.4 -42.4 -8.0 -18.1

Saudi Arabia TASI 6,954.38 977 0.3 0.0 -2.3 -3.5 -28.2 0.2 -22.4

UAE, Abu Dhabi ADSMI 4,376.22 42 0.2 -2.0 -1.7 -3.7 -8.6 63.6 NA

UAE, Dubai DFMGI 3,449.81 106 1.0 -4.8 -4.5 -2.3 -22.5 113.3 -36.6

South Africa JSE All Share 59,862.11 1166 -1.4 -1.2 0.5 13.8 -5.6 -2.2 -9.9

ASIA

China HSCCI 4,462.06 740 0.4 0.9 2.1 23.7 0.7 6.0 -27.6

China A-Shares SHASHR 3,589.86 30892 0.2 0.8 1.4 15.5 30.7 55.8 -28.2

India BSE 30 33,250.93 101 0.1 -1.5 5.1 30.6 13.2 50.0 6.4

Indonesia JSE CI 6,042.46 428 0.3 0.1 1.3 26.3 13.3 27.8 77.0

Korea KOSPI 2,550.57 6022 -0.1 0.1 9.1 36.1 28.9 30.6 4.6

Malaysia KLCI 1,746.81 232 0.7 0.9 -0.4 13.5 -23.8 -22.5 -1.6

Pakistan KSE 29,715.87 96 1.0 2.4 0.8 -10.2 27.5 138.4 80.8

Philippines MSE CI 8,519.82 115 0.2 0.3 1.8 20.5 3.9 24.8 91.8

Taiwan TWSE 10,743.27 4606 -0.7 -0.4 2.7 24.4 22.4 41.6 27.9

Thailand SET 1,703.03 1512 -0.6 0.1 1.5 19.5 6.9 22.1 99.3

LATAM

Argentina MERVAL 27,951.54 36 -0.4 0.1 4.0 49.8 28.3 219.1 115.9

Brazil BOVESPA 72,930.69 2159 -1.9 -0.7 -5.6 21.2 7.8 -20.0 NA

Chile IPSA 5,443.89 145 -0.5 -1.4 -0.3 39.4 30.5 -2.3 34.8

Colombia IGBC 10,806.63 na 1.0 2.3 -4.1 6.6 -42.7 -54.5 -31.8

Mexico IPC 48,713.51 377 -0.3 0.1 -4.9 15.9 -22.5 -17.2 -4.8

Peru IBVL 19,961.68 15 0.2 -0.7 3.8 32.8 16.5 -23.6 -6.7

Venezuela BVC 685.51 2887 -2.6 -3.9 29.9 -97.8 14372.8 80001.3 377805.0 Source: Bloomberg Finance LP

10 November 2017



Currencies Country Currency Last Price Price Performance Forecasts 9-Nov-17 1D 1 W 1 M Ytd 3 Y 5 Y 3M 6M 12M EMEA

Czech Republic CZK 21.9 -0.6 -0.5 0.4 -14.1 -1.2 9.9 21.4 21.2 20.8

Hungary HUF 268.3 -0.4 0.2 2.7 -8.5 8.4 20.3 265.3 264.7 260.0

Israel ILS 3.5 0.2 0.3 0.7 -8.2 -7.4 -9.9 3.5 3.5 3.4

Poland PLN 3.6 -0.5 -0.5 0.9 -12.9 7.3 11.3 3.5 3.4 3.4

Russia RUB 59.3 0.2 0.1 2.3 -3.3 29.6 87.4 56.6 56.8 57.0

Turkey TRY 3.9 0.0 -0.2 5.4 9.7 71.2 116.0 3.8 3.8 3.9

South Africa ZAR 14.3 0.8 0.3 5.0 4.0 26.7 63.2 12.4 12.3 12.0

ASIA

China CNY 6.6 0.0 0.2 0.9 -4.5 8.3 6.2 6.9 7.0 7.1

India INR 64.9 0.0 0.6 -0.3 -4.4 5.7 19.2 66.0 66.0 66.0

Indonesia IDR 13,515.0 0.0 0.1 0.0 0.5 11.1 40.4 13,870.0 13,990.0 14,180.0

Korea KRW 1,117.5 0.4 0.2 -1.6 -7.5 3.0 2.7 1,130.0 1,140.0 1,160.0

Malaysia MYR 4.2 -0.5 -0.7 -0.4 -6.2 26.2 37.3 4.4 4.4 4.6

Pakistan PKR 105.0 -0.2 -0.2 -0.1 0.5 3.2 9.5 na na na

Philippines PHP 51.3 0.0 -0.1 -0.1 3.2 14.1 24.9 52.5 53.2 53.5

Taiwan TWD 30.2 0.1 0.0 -0.1 -6.3 -1.2 3.9 31.2 31.5 31.7

Thailand THB 33.1 0.0 0.0 -0.2 -7.5 1.0 8.0 33.7 33.9 34.2

LATAM

Argentina ARS 17.5 -0.8 -0.1 0.5 9.7 105.5 266.9 18.3 19.0 20.3

Brazil BRL 3.3 0.2 -1.5 3.0 0.2 28.2 58.9 3.2 3.3 3.3

Chile CLP 630.7 -0.3 -0.5 0.6 -5.4 7.4 31.5 642.0 645.0 650.0

Mexico MXN 19.1 0.0 -0.6 2.0 -7.6 40.8 44.6 19.4 19.4 19.5

Colombia COP 3,014.5 -0.1 -1.7 2.0 0.5 43.1 66.0 2,990.1 3,005.0 3,034.7

Peru PEN 3.2 0.0 -0.1 -0.5 -3.4 10.6 24.2 3.2 3.2 3.2

Other Nations

Euro EUR 0.9 -0.4 -0.2 1.9 -9.4 6.8 9.3 0.8 0.8 0.8

UK GBP 0.8 -0.2 -0.3 0.6 -6.1 20.8 21.3 0.8 0.8 0.8

Switzerland CHF 1.0 -0.3 -0.3 2.6 -2.0 3.0 5.1 0.9 0.9 0.9

Japan JPY 113.6 0.0 -0.6 1.2 -2.8 -1.0 43.0 117.0 118.0 120.0

Hong Kong HKD 7.8 0.0 0.0 -0.1 0.6 0.5 0.6 7.8 7.8 7.8 Source: Bloomberg Financial LP

10 November 2017



Commodities

Price local Performance (% )

Forecasts

9-Nov-17 1D 1 W 1 M Ytd 3 Y 5 Y 10 Y 2016E 2017E 2018E

BASE METAL

Aluminium ($/mt) 2,093.0 -0.8 -4.2 -2.8 23.6 0.8 8.7 -20.4 1788 1728 1670

Copper ($/mt) 6,808.0 -0.7 -1.3 2.1 23.0 2.2 -10.8 -5.4 5900 5725 6800

Nickel ($/mt) 12,247.0 -3.2 -3.4 16.5 22.9 -20.7 -24.0 -62.2 10625 11250 12500

Iron Ore($/mt) 53.2 -13.8 -12.0 na -31.9 -29.7 -56.5 na 69 54 56

Zinc ($/mt) 3,232.0 -0.1 -1.0 -3.1 26.1 45.7 71.1 16.4 3100 2538 2100

Tin ($/mt) 19,475.0 -0.4 -1.1 -7.6 -7.7 -1.9 -5.2 17.7 20510 19613 19408

OIL

WTI (Oil) 57.2 0.6 2.7 16.0 6.4 -26.6 -32.8 -40.1 54 60 62

PRECIOUS METAL

Gold ($/Oz.) 1,285.1 0.3 1.2 0.7 11.5 12.5 -25.8 54.2 1203 1255 1288

Palladium Spot $/Oz 1,011.8 -0.4 1.2 9.5 48.6 34.7 64.5 171.6 748 783 850

Platinum Spot $/Oz 937.2 0.6 1.7 2.3 3.7 -21.6 -39.3 -35.9 996 1125 1250

Silver Spot $/Oz 17.0 -0.3 0.9 1.0 6.8 10.2 -47.4 10.2 17.2 18.5 19.0 Source: Bloomberg Financial LP

CE

EM

EA

& Latam

Dayb

oo

k

10

No

vemb

er 20

17

Deu

tsche B

ank A

G/Lo

nd

on

P

age 29

Macro Data GDP Growth

(YoY %)

GDP Nominal ($bn)

GDP per Capita ($)

CPI

(YoY %)

CA Balance

(% GDP)

Fiscal Balance

(% GDP)

Total Govt Debt

(% GDP)

Total Ext Debt

(% GDP)

Country 2017E 2018E 2017E 2017E 2017E 2018E 2017E 2018E 2017E 2018E 2017E 2018E 2017E 2018E

CEEMEA

Czech Republic 3.8 3.0 191 18116 2.4 2.2 1.3 1.0 0.3 0 35.7 34.7 69.6 62.4

Egypt 3.5 4.1 NA NA 29.9 16.9 -5.1 -3.8 -10.9 -9.9 101.2 88.8 NA NA

Hungary 3.8 3.5 137 13936 2.3 2.6 3.1 2.5 -2.3 -2.4 72.4 71.1 95.4 94.4

Israel 3.6 3.6 353 40536 0.1 0.6 3.5 3.0 -2.5 -2.5 60.4 60.0 24.3 22.2

Kazakhstan 3.6 3.6 NA NA 6.5 6.5 -1.9 -1.9 0.1 0.1 NA NA NA NA

Poland 3.9 3.4 519 13660 1.9 2.0 -1.0 -1.1 -2.7 -2.9 53.3 53.9 71.9 71.4

Russia 2.0 1.8 1569 10683 3.8 3.5 2.9 3.2 -2.5 -1.4 15.2 15.7 33.6 32.6

Saudi Arabia 1.6 1.6 NA NA 4.0 4.0 -6.8 -6.8 -9.5 -9.5 17.0 20.7 NA NA

South Africa 0.8 1.7 352 6196 5.2 4.4 -2.5 -3.1 -4 -3.3 51.7 52.1 36.7 30.3

Turkey 5.2 4.1 840 10579 10.8 8.5 -4.9 -4.7 -2.0 -2.4 28.4 28.9 50.2 49.1

United Arab Emirates 2.7 2.7 NA NA 3.3 3.3 3.5 3.5 0.3 0.3 20.7 20.8 43.0 NA

ASIA

China 6.8 6.3 12065 8560 1.7 2.7 1.2 1.1 -4 -4 41.6 42.1 13.0 13.20088

India 6.5 7.5 2514 1924 3.1 4.4 -1.3 -1.5 -3.2 -3 69.1 67.4 19.8 18.9

Indonesia 5.0 4.8 1009 3854 3.9 3.2 -1.6 -1.4 -1.7 -1.4 27.4 28.5 31.1 28.9

Korea 2.9 2.7 1496 29339 2.1 2.0 5.7 5.1 0.7 0.7 41.5 42.6 27.3 27.7

Malaysia 5.5 5.0 313 9762 3.5 2.5 2.7 2.5 -3.2 -3.0 66.3 65.6 62.4 54.7

Philippines 6.4 5.7 313 2982 3.2 3.4 1.0 2.0 -2.6 -2.8 44.2 43.1 23.3 21.9

Taiwan 2.2 2.2 566 24028 0.7 1.5 12.7 11.9 -0.5 -0.4 38.1 38.5 31.8 32.6

Thailand 3.7 3.6 447 6748 0.7 1.7 9.4 8.6 -2.0 -1.9 38.0 38.7 31.8 31.6

LATAM

Argentina 2.8 2.9 612 14 27.1 18.1 -3.5 -3.8 -6.2 -5.5 45.2 50.1 31.9 31.4

Brazil 0.7 2.6 2034 9802 3.4 3.4 -0.6 -1.4 -8.1 -7.5 75.5 76.7 26.9 25.7

Chile 1.5 2.9 276 15 2.1 1.8 -1.6 -1.3 -3.2 -3.6 23.6 25.6 79.4 85.0

Colombia 1.6 2.5 306 6209 4.3 3.1 -3.4 -3.3 -3.7 -3.4 45.2 46.3 41.7 41.6

Mexico 2.0 2.4 1404 11 6.0 4.2 -1.8 -2.0 -1.9 -2.5 48.7 48.7 23.0 30.2

Peru 2.7 4.0 212 6665 3.0 2.0 -1.8 -1.7 -3.0 -3.5 25.5 27.6 35.7 33.3

Venezuela -12.0 -6.0 215 6850 652.7 2349.3 -0.4 -1.3 -18.5 -18.7 17.3 16.6 65.3 66.8

CEEMEA 3.0 2.8 3961 113706 7.3 5.8 -1.3 -1.2 -3.8 -3.5 33.2 33.5 45.4 43.6

ASIA 6.1 6.0 18723 87196 2.3 3.1 1.5 1.3 -3.1 -3.1 44.8 45.0 18.0 17.8

LATAM 0.9 2.3 5059 29567 37.4 109.4 -1.6 -2.0 -5.8 -5.6 55.2 56.5 32.2 33.9

EM 4.7 4.9 27743 230470 7.8 16.8 0.5 0.3 -3.6 -3.5 45.0 45.5 24.5 24.4

US 2.2 2.4 NA NA 2.1 2.0 -2.9 -3.2 -3.6 -2.8 NA NA NA NA

Europe 2.2 2.0 NA NA 1.5 1.4 3.0 2.6 -1.3 -1.3 NA NA NA NA

Japan 1.5 0.7 NA NA 0.3 0.4 4.0 4.2 -3.5 -3.1 NA NA NA NA Source: Deutsche Bank, IMF

10 November 2017



Interest Rates Yield Change in bps

(%) 1 M 1 Y

Czech Republic CZK_SW05/6MF/ICAP 0.91 -12 33

Hungary HUF_SW05/6MF 1.12 -26 -35

Israel ILS_SW05 0.82 -10 5

Poland PLN_SW05/6MF/ICAP 2.28 -14 29

Russia RUB_SW05/ICAP 6.80 -33 -140

Saudi Arabia SAR_SW05 3.05 -51 -16

South Africa - ZAR_SW05 7.35 -12 -118

Turkey TRY_SW05 10.77 -15 103

Argentina - ARG ARS BONAR V 3.82 292 84

Brazil - BRL PRE 5Y 10.84 66 -154

Chile - CLP SWAP 5Y 3.38 -7 -72

Colombia - COP_USD_SWAP 5Y 5.14 -18 -161

Mexico - MXN TIIE 5Y 7.16 -11 168

Peru - PEN Nominal/PERUGB AUG 20 4.14 -25 -124 Source: Deutsche Bank

Country Risk 10Yr Credit Default Swap(Bps) (CEEMEA)


Country Risk 10Yr Credit Default Swap(Bps)


10 November 2017



P/BV valuation – By Countries GEM Country Current P/BV Current P/BV versus

country's 10-year historical average P/BV

Current P/BV relative to EM P/BV , versus 10-

year historical average

EM 1.82 6.0% 0.0%

DM 2.43 23.5% 13.4%

US 3.25 31.6% 20.3%

Brazil 1.76 5.4% 0.4%

Chile 1.99 -3.0% -9.2%

China 2.11 11.4% 6.9%

Colombia 1.28 -24.3% -29.2%

Czech Republic 1.45 -18.3% -21.9%

Egypt 3.29 52.0% 44.1%

Greece 0.42 -62.6% -64.3%

Hungary 1.84 44.4% 37.0%

India 3.17 2.5% -3.8%

Indonesia 3.07 -13.9% -19.0%

Korea 1.26 4.1% -1.9%

Malaysia 1.66 -17.3% -23.3%

Mexico 2.63 -4.8% -12.1%

Peru 2.47 -21.5% -24.0%

Philippines 2.64 -3.0% -11.3%

Poland 1.48 5.7% -0.5%

Qatar 1.33 -33.1% -37.2%

Russia 0.83 -12.7% -15.2%

South Africa 2.43 -1.1% -8.6%

Taiwan 2.02 11.3% 3.4%

Thailand 2.20 6.7% -1.5%

Turkey 1.41 -10.4% -16.3%

UAE 1.53 16.7% 7.6% Source: Deutsche Bank

P/BV valuation – By EM Sector

GEM Sector Current P/BV Current P/BV versus

sector's 10-year historical

average P/BV

Current P/BV relative to EM

P/BV , versus 10-year

historical average

EM 1.82 6.0% 0.0%

Consumer Discretionary 2.27 6.5% -1.2%

Consumer Staples 4.00 11.9% 2.5%

Energy 0.95 -19.4% -21.5%

Financials 1.28 -16.5% -20.7%

Health Care 4.05 11.3% 1.6%

Industrial 1.46 -10.1% -15.0%

Information Technology 3.44 57.1% 45.9%

Materials 1.51 -5.6% -9.3%

Real Estate 1.54 13.0% 2.2%

Telco 2.01 -13.1% -18.7%

Utilities 1.13 -1.9% -9.1% Source: Deutsche Bank

10 November 2017



CEEMEA valuation 11/09/17 Daily YTD Price P/BV (x) Div Yld % (US$ m)Company Ticker Rating Price Change % Change % Target 2017E 2018E 2017E 2018E 2017E 2017E Mkt Cap

Banks

Abu Dhabi Comm Bank ADCB.AD Buy 7.26 1.5 5.2 8.80 15.6 16.3 9.1 8.1 1.3 5.8 10241

Akbank AKBNK.IS Hold 9.64 -1.9 12.4 10.40 16.6 16.1 7.2 6.6 1.1 2.3 9969

Al Rajhi Bank 1120.SE Buy 63.40 0.3 0.7 71.50 16.3 16.4 11.7 10.9 1.9 3.5 27469

Alawwal bank 1040.SE Hold 11.82 0.2 -15.2 12.50 8.7 13.0 12.0 7.5 1.0 2.1 3602

Alinma Bank 1150.SE Hold 17.71 -0.1 17.3 17.00 9.2 11.1 14.6 11.5 1.3 3.4 7030

Arab National Bank 1080.SE Hold 24.97 0.3 12.8 26.25 12.7 12.6 8.2 7.7 1.0 3.6 6658

Bank Saint-Petersburg BSPB.MM Sell 55.50 -1.1 -14.1 32.00 5.2 NA na na 0.4 NA 412

Banque Saudi Fransi 1050.SE Hold 29.48 -1.1 13.0 32.25 13.0 13.3 9.0 8.4 1.1 3.6 9439

Barclays Africa Group BGAJ.J Buy 142 -1.8 -18.9 175.00 15.2 14.3 7.8 7.3 1.1 7.4 8457

Capitec Bank CPIJ.J Sell 922 -2.2 27.6 360.00 25.7 25.4 28.3 24.4 6.7 1.4 7482

CIB COMI.CA Hold 77.90 1.2 9.5 73.00 36.3 33.1 11.0 9.4 3.1 2.0 5093

Dubai Islamic Bank DISB.DU Buy 6.02 -0.2 8.1 7.30 22.4 21.1 8.3 8.5 1.6 7.6 8083

Emirates NBD ENBD.DU Buy 8.16 -2.6 -3.9 12.75 16.7 16.0 6.2 5.9 0.9 5.8 12347

First Abu Dhabi Bank FAB.AD Hold 10.15 -0.5 6.1 11.40 12.2 12.5 10.7 9.9 1.2 5.1 29990

Garanti GARAN.IS Buy 10.15 -2.2 21.4 11.40 16.2 16.0 7.0 6.3 1.1 2.9 11021

Halkbank HALKB.IS Hold 10.11 -2.0 -1.3 15.00 16.7 15.3 3.3 3.1 0.5 2.0 3267

Isbank ISCTR.IS Hold 6.82 -1.9 20.0 7.70 14.2 13.7 5.7 5.4 0.8 3.8 7934

National Bank of Kuwait NBKK.KW Buy 727 1.6 12.9 850.00 11.1 13.9 13.5 10.0 0.0 3.7 13971

NCB 1180.SE Hold 52.43 0.1 23.1 48.00 17.5 17.2 11.2 10.6 1.8 3.1 27915

Nedbank NEDJ.J Buy 209 -1.2 -15.6 225.00 14.6 14.6 8.8 8.2 1.2 6.0 7014

Qatar National Bank QNBK.QA Buy 121 1.1 -20.5 150.00 20.7 19.1 8.6 8.0 1.5 3.7 29245

RAKBANK RAKB.AD Hold 4.80 -4.0 -3.0 5.05 10.8 11.9 9.6 8.8 1.0 6.2 2191

Riyad Bank 1010.SE Hold 12.05 -0.4 4.4 10.50 9.0 10.0 10.7 9.4 1.0 5.4 9639

Samba Financial Group 1090.SE Hold 23.43 0.0 -3.7 24.00 11.1 11.6 9.3 8.5 1.0 4.1 11841

Saudi British Bank 1060.SE Buy 25.97 3.3 3.9 29.00 13.1 13.1 9.3 8.7 1.2 3.0 10387

Sberbank SBER.MM Buy 220 5.1 31.4 215.00 20.2 19.6 7.8 6.9 1.5 0.0 81408

Standard Bank SBKJ.J Buy 168 -1.1 6.2 170.00 16.3 16.3 10.7 10.0 1.7 5.2 19062

TCS TCSq.L Sell 19.20 3.8 82.0 7.30 31.1 29.8 19.3 16.1 5.4 1.5 3507

Vakifbank VAKBN.IS Hold 5.91 -1.3 23.9 6.90 15.8 14.7 4.5 4.2 0.7 0.8 3820

VTB VTBRq.L Sell 2.12 1.9 -11.4 0.80 2.3 NA na na 0.6 0.0 13706

Yapi Kredi Bank YKBNK.IS Hold 4.47 0.2 18.8 4.80 12.2 12.4 5.7 5.0 0.7 0.0 5024

Consumer Discretionary

Al Tayyar 1810.SE Buy 26.79 3.2 -27.0 45.00 5.4 4.9 7.6 7.5 0.9 3.7 1498

Alhokair 4240.SE Hold 31.65 5.3 -14.0 42.00 10.1 9.4 19.5 14.7 2.3 0.0 1772

CCC CCCP.WA Buy 248 -6.1 41.1 340.00 18.4 13.7 31.3 21.0 6.1 1.0 2712

Cyfrowy Polsat CPS.WA Hold 25.40 0.1 18.5 28.00 7.1 6.7 14.9 12.8 1.3 1.3 4462

Herfy 6002.SE Buy 44.54 -0.4 -42.9 70.00 9.7 8.9 12.5 11.4 3.2 4.9 768

Imperial IPLJ.J Buy 208 -0.4 9.7 210.00 6.3 5.7 11.6 12.2 2.1 4.2 2835

Jarir Marketing 4190.SE Hold 142 0.2 22.4 137.00 15.5 14.2 15.9 14.8 7.5 5.0 3399

LPP LPPP.WA Hold 8,255 -1.5 67.0 8,000.00 15.8 13.3 29.5 25.2 5.9 0.4 4158

Mr Price MRPJ.J Buy 192 -2.0 15.8 192.00 13.8 12.4 22.3 19.5 7.3 3.6 3447

Naspers NPNJn.J Buy 3,565 -0.7 70.2 3,552.00 1,506.8 247.2 39.0 45.1 7.2 0.3 107837

Richemont CFRJ.J Buy 128 -1.4 35.9 105.00 17.6 14.4 30.4 24.0 2.8 2.0 50702

SACO 4008.SE Hold 102 -1.1 19.3 90.00 13.8 12.3 18.0 16.1 4.6 4.4 651

STAR SRRJ.J Buy 23.95 -1.1 3.6 24.00 13.8 12.2 25.1 23.4 1.6 2.0 5796

Steinhoff SNHJ.J Hold 58.49 -2.2 -21.1 70.00 9.1 8.0 11.4 10.0 0.9 0.8 17473

Super Group SPGJ.J Buy 40.06 -1.2 -0.3 46.00 6.1 4.9 11.7 10.6 1.7 1.6 979

The Foschini Group Ltd TFGJ.J Hold 139 -1.9 -16.0 142.00 8.4 8.3 13.6 13.1 3.2 5.1 2068

Truworths TRUJ.J Buy 70.10 -2.0 -15.4 92.00 7.3 6.7 12.7 10.1 3.3 6.3 2107

Woolworths Holdings Ltd WHLJ.J Hold 55.65 -1.3 -24.6 61.00 8.1 8.2 17.7 13.8 2.8 5.7 3752

Consumer Staples

Almarai 2280.SE Sell 54.94 0.8 1.6 48.00 16.0 15.6 24.2 23.3 3.8 1.3 14649

AVI AVIJ.J Buy 97.71 -1.5 2.9 110.00 11.9 10.8 18.5 17.4 6.5 3.9 2228

BidCorp BIDJ.J Hold 308 -2.0 21.0 305.00 15.6 14.0 22.2 23.1 4.4 1.6 7186

British American Tobacco BTIJ.J Buy 927 -0.5 14.5 600.00 14.0 na 18.3 na 0.2 3.5 111855

Clicks Group Ltd CLSJ.J Hold 155 -3.3 28.8 144.00 17.1 15.1 25.8 27.4 11.1 1.2 2567

Eurocash EUR.WA Buy 34.48 -1.2 0.6 42.00 11.7 10.6 29.3 22.3 4.6 2.1 1316

Lenta LNTAq.L Hold 6.15 0.0 -25.0 6.80 7.7 6.7 13.4 11.3 2.5 0.0 2993

Magnit MGNT.MM Hold 7,399 -0.2 -29.9 9,000.00 9.3 7.8 18.5 14.1 3.3 3.4 11808

Magnit MGNTq.L Hold 27.24 1.3 -37.9 37.00 9.9 8.3 20.1 15.3 3.6 3.1 12879

Massmart MSMJ.J Hold 112 -0.4 -14.6 119.00 8.2 7.5 19.8 17.4 3.6 2.5 1700

Othaim 4001.SE Hold 118 -1.1 20.3 116.00 14.8 12.9 19.0 16.8 3.7 1.7 1421

Pick'n Pay Stores PIKJ.J Hold 59.00 -0.7 -10.9 62.00 10.7 9.7 28.6 21.3 7.1 2.7 1996

Pioneer PFGJ.J Buy 117 -3.7 -27.2 130.00 12.8 8.7 22.6 14.6 3.3 2.7 1530

Shoprite SHPJ.J Hold 210 -0.5 17.8 204.00 11.1 10.2 19.4 18.4 4.3 2.5 8001

Spar Group Limited SPPJ.J Hold 167 -1.3 -19.3 167.00 11.5 10.5 17.4 15.8 5.1 3.8 2245

Tiger Brands TBSJ.J Hold 387 -2.1 -6.6 410.00 12.6 11.3 18.4 16.3 3.7 2.7 4500

X5 Retail Group PJPq.L Buy 41.14 2.2 26.8 57.00 8.4 6.9 19.7 14.4 4.1 1.3 11171

EV/EBITDA (x) P/E (x)

EV/EBITDA for Banks has been replaced by ROE The Daily and YTD % Price changes refer to the change in US dollar value of the stock Source: Deutsche Bank, Companies

10 November 2017




Diversified Financials

Alexander Forbes AFHJ.J Buy 6.96 -4.1 -15.8 7.75 na na 12.9 11.0 na 5.7 616

Brait BATJ.J Buy 47.71 -3.7 -47.6 64.00 na na na na na NA 1694

Coronation CMLJ.J Sell 76.18 -0.9 3.9 68.00 13.0 13.0 17.2 14.9 12.7 5.9 1869

FirstRand FSRJ.J Hold 52.41 -2.0 -5.2 50.00 2.9 2.9 10.8 11.3 2.7 4.9 20618

Investec INVP.L Buy 518 -0.8 2.9 590.00 0.0 0.0 11.7 10.2 0.0 4.7 6117

Investec INLJ.J Buy 96.61 -1.6 2.4 110.00 1.3 1.3 9.6 9.7 1.4 4.6 6103

JSE JSEJ.J Buy 135 -1.2 -21.0 144.00 10.8 8.6 14.7 12.2 3.8 4.1 812

Moscow Exchange MOEX.MM Buy 128 0.4 5.3 185.00 5.9 5.6 11.7 11.4 2.2 6.2 4810

Peregrine PGRJ.J Buy 29.19 -0.6 -6.4 31.75 na na 12.8 10.0 na 4.5 432

RMB Holdings Ltd RMHJ.J Buy 63.83 -2.4 -7.5 63.00 2.4 2.4 11.7 11.0 2.2 5.1 6321

Transaction Capital TCPJ.J Buy 14.60 -1.5 -2.9 16.75 2.8 2.8 15.3 12.6 2.6 2.4 612

Energy

Dana Gas DANA.AD Hold 0.73 2.8 35.2 0.62 20.9 21.4 na na 0.5 0.0 1385

Gazprom GAZP.MM Hold 132 -0.8 -12.0 115.00 3.7 3.6 3.8 3.5 0.2 6.7 49049

Gazprom Neft SIBN.MM Hold 260 1.1 25.7 230.00 4.2 3.7 4.8 3.8 0.8 4.2 20711

Gulf Int'l Services GISS.QA Buy 15.60 0.4 -52.4 27.00 8.6 7.0 26.7 11.6 0.8 6.2 756

KazMunaiGas E&P KMGq.L Buy 11.00 1.4 43.0 12.00 0.9 1.0 7.3 12.5 0.7 1.3 4508

LUKOIL LKOH.MM Buy 3,368 0.8 1.0 3,800.00 3.5 3.5 7.2 7.1 0.7 5.8 40525

Novatek NVTKq.L Hold 117 -0.2 -10.1 102.00 10.9 10.4 14.3 13.0 2.8 2.1 35241

Rosneft ROSN.MM Buy 337 1.0 -13.5 390.00 5.3 4.5 6.3 5.1 1.0 3.0 60259

Sasol SOLJ.J Hold 435 0.1 4.9 370.00 6.5 7.3 11.0 12.3 1.3 3.6 18634

Surgutneftegaz SNGS_p.MM Buy 31.50 0.0 1.6 32.00 3.3 3.8 4.7 5.8 0.4 1.9 23087

Surgutneftegaz SNGS.MM Hold 30.61 -0.2 2.3 29.00 3.2 3.7 4.6 5.7 0.4 2.0 22431

Tatneft TATN.MM Hold 491 0.1 19.0 525.00 5.3 5.8 7.7 8.6 1.5 10.7 18664

TMK TRMKq.L Buy 5.77 0.2 13.1 7.00 6.7 7.3 12.2 21.2 1.8 2.7 1516

Transneft TRNF_p.MM Buy 183,700 0.4 -4.0 250,000.00 3.7 3.5 5.9 5.8 0.7 4.5 22086

Health Care

Aspen APNJ.J Hold 316 -1.5 7.0 305.00 15.5 13.5 21.4 17.9 3.0 0.9 10100

IDH IDHC.L Hold 4.14 1.7 22.7 3.21 17.5 14.7 27.9 22.9 4.9 3.4 621

Life HC LHCJ.J Hold 24.80 -0.8 -26.8 30.60 8.7 8.4 13.7 15.0 2.6 4.4 2224

MDMG MDMGq.L Buy 10.50 0.0 11.9 13.80 11.1 10.8 17.0 17.2 3.2 1.6 786

Mediclinic MEIJ.J Hold 113 -0.4 -16.1 150.00 12.4 10.5 19.5 15.3 0.0 1.3 5863

Mediclinic International MDCM.L Hold 611 0.9 -15.6 860.00 12.4 10.6 19.4 15.3 0.0 1.3 5904

Netcare NTCJ.J Hold 25.08 -0.1 -24.2 29.20 8.9 8.4 13.2 12.6 2.8 4.0 2404

NMC Health NMC.L Buy 2,973 -2.7 105 3,920.00 25.3 19.9 40.4 28.7 7.4 0.4 8084

SPIMACO 2070.SE Buy 28.66 -0.5 -29.7 50.00 15.9 14.7 13.6 12.7 1.1 3.5 917

Industrials

Arabtec Holding ARTC.DU Hold 2.77 -3.1 -48.1 2.96 15.4 12.2 39.8 35.0 2.7 0.0 1131

Barloworld BAWJ.J Hold 136 -2.2 11.3 128.00 5.3 4.9 14.3 11.8 1.4 2.8 2022

Bidvest BVTJ.J Hold 176 -1.2 -6.4 168.00 7.7 7.9 14.7 14.1 2.7 3.0 4127

DP World DPW.DI Buy 23.76 0.7 35.7 28.00 10.1 9.3 15.6 14.1 2.0 1.7 19721

Drake & Scull DSI.DU Hold 1.76 -3.8 -8.4 0.40 na 33.8 na 54.2 3.3 0.0 1079

Enka Insaat ENKAI.IS Hold 5.83 0.3 -1.2 5.70 7.7 6.2 8.7 7.4 1.0 3.1 6331

Global Ports GLPRq.L Hold 3.89 -1.5 -2.8 4.50 6.8 6.1 8.7 7.9 1.9 0.0 743

Globaltrans GLTRq.L Buy 9.55 -1.2 50.9 9.50 5.5 4.8 12.5 10.2 2.1 8.9 1707

Industries Qatar IQCD.QA Buy 94.19 0.3 -24.0 125.00 46.9 39.0 14.7 13.3 1.5 4.2 14851

Orascom Construction OC.DI Buy 7.49 0.0 42.9 7.60 4.0 4.4 7.7 8.1 2.4 0.0 882

Tekfen Holding TKFEN.IS Hold 14.37 -1.2 103 10.70 7.0 6.8 9.0 8.9 1.9 2.1 1375

Insurance

Discovery DSYJ.J Sell 149 -0.9 24.8 125.00 na na 20.6 17.8 na 1.3 6723

Liberty LBHJ.J Buy 112 -0.4 -2.8 125.00 na na 11.1 9.8 na 6.4 2199

MMI MMIJ.J Hold 19.45 -0.8 -20.7 20.00 na na 9.7 9.1 na 8.1 2189

Old Mutual OMLJ.J Buy 35.75 -0.8 -0.2 44.00 na na 0.1 0.1 na 352.9 11965

RMI RMIJ.J Hold 38.61 -2.3 -6.7 41.00 na na 14.7 12.1 na 3.1 4025

Sanlam SLMJ.J Buy 72.17 -1.1 10.4 84.00 na na 15.3 13.3 na 4.1 10360

Santam SNTJ.J Hold 250 -1.5 2.8 285.00 na na na na na na na



10 November 2017




Materials

Alrosa ALRS.MM Buy 76.00 -0.4 -19.3 97.00 4.9 4.4 8.9 8.0 1.7 4.7 9256

Amplats AMSJ.J Buy 417 0.4 51.7 375.00 10.3 14.4 36.4 63.2 2.8 0.0 7670

AngloGold Ashanti ANGJ.J Hold 139 -1.4 -12.6 130.00 7.1 5.0 56.2 16.8 1.5 0.0 4013

Antofagasta PLC ANTO.L Sell 977 -2.1 54.1 800.00 6.8 6.8 18.0 18.6 1.7 3.1 12633

Erdemir EREGL.IS Sell 9.82 3.3 74.2 7.30 6.5 7.5 9.3 11.6 2.0 8.1 8886

Evraz EVRE.L Hold 288 -0.8 38.0 295.00 4.2 5.0 5.1 6.6 4.5 8.1 5310

Gold Fields GFIJ.J Hold 56.81 -2.3 25.4 52.00 4.2 4.6 15.4 25.6 1.0 2.1 3270

Harmony HARJ.J Sell 25.80 0.0 -21.3 21.00 8.0 4.0 13.6 18.5 0.4 3.9 793

Impala Platinum IMPJ.J Hold 40.01 -0.7 -10.0 35.00 9.4 12.0 na na 0.6 0.2 2015

KGHM KGH.WA Hold 121 -0.1 49.8 131.00 4.6 3.7 6.7 5.4 1.3 1.2 6628

Lonmin Plc LONJ.J Sell 12.79 1.2 -47.6 9.50 na na na na 0.2 0.0 253

Ma'aden 1211.SE Sell 53.14 0.5 36.3 31.00 24.2 18.1 86.6 46.8 2.4 0.0 16556

Magnitogorsk Steel MAGNq.L Hold 9.80 -3.9 40.4 7.80 4.5 4.9 8.0 10.3 1.5 2.5 8364

Mechel MTL.N Sell 4.90 0.0 -14.5 3.71 4.6 5.1 1.9 2.7 na 0.0 1428

Nampak NPKJ.J Buy 17.90 0.9 -7.2 22.50 4.9 4.1 8.3 8.1 1.1 0.0 804

NLMK NLMKq.L Sell 21.85 -1.4 17.5 16.80 5.8 6.9 9.9 13.3 2.0 7.6 13095

Norilsk Nickel NKELyq.L Hold 19.60 -0.1 16.7 18.40 9.1 7.9 12.5 11.2 8.7 9.6 30770

Northam NHMJ.J Hold 51.50 0.4 22.3 48.00 23.6 17.0 na na 2.2 0.0 1264

Pfleiderer Group SA PFLP.WA Hold 36.62 1.5 13.9 40.00 6.2 5.6 24.5 15.2 2.3 2.8 651

PHOSAGRO PHORq.L Hold 14.15 -0.4 -7.2 13.00 7.0 6.5 9.5 9.0 3.1 5.3 5497

Polymetal POLYP.L Hold 892 -0.6 11.0 870.00 8.2 7.5 14.4 13.1 4.1 2.1 4972

RBPlat RBPJ.J Hold 33.85 -1.3 -8.6 31.00 29.5 443.9 373.2 na 0.6 0.0 457

SABIC 2010.SE Hold 99.73 -0.3 9.0 95.00 7.8 7.3 15.5 15.0 1.7 4.0 79773

Severstal SVSTq.L Hold 14.80 -3.6 -2.6 14.20 5.3 5.3 7.7 8.2 3.5 9.7 12022

Sibanye-Stillwater SGLJ.J Hold 20.05 0.6 -24.0 15.50 6.9 5.5 na 31.3 1.8 1.5 2570

United Company RUSAL 0486.HK Sell 5.40 -0.6 63.6 4.32 8.7 7.8 6.8 5.8 2.3 2.8 10519

Real Estate

Aldar Properties ALDR.AD Buy 2.24 0.5 -14.8 3.00 7.2 7.6 9.1 9.7 0.8 4.9 4795

Attacq ATTJ.J Buy 18.65 -0.8 6.2 22.00 28.9 26.2 20.5 17.3 0.9 0.0 920

Damac Properties DAMAC.DU Hold 3.59 -0.8 56.1 3.20 4.9 4.6 6.1 5.9 1.5 7.0 5913

Dar Al Arkan 4300.SE Hold 8.96 9.8 45.7 6.00 22.4 20.5 37.1 30.4 0.5 0.0 2580

Emaar Economic City 4220.SE Hold 12.37 1.7 -27.8 12.10 58.4 43.3 72.4 44.6 1.2 0.0 2803

Emaar Malls EMAA.DU Hold 2.24 0.5 -15.2 2.70 12.4 11.1 14.6 13.1 1.7 4.5 7937

Emaar Properties EMAR.DU Buy 7.87 -1.6 12.7 10.70 8.3 7.6 9.1 8.5 1.2 2.6 15340

Emira Property Fund EMIJ.J Hold 13.28 0.2 -10.6 14.50 12.2 12.0 14.1 10.4 0.7 0.0 464

Emlak REIT EKGYO.IS Hold 2.66 -1.8 -18.9 3.19 5.4 5.7 5.5 5.8 0.8 0.0 2613

Equites EQUJ.J Buy 20.82 -1.7 26.7 21.50 18.2 12.5 7.8 17.0 1.4 0.0 433

Etalon Group ETLNGq.L Buy 4.08 -0.6 27.5 3.40 11.9 5.1 17.8 6.4 1.2 1.2 1190

Fortress FFBJ.J Hold 40.88 -0.5 21.6 42.00 20.5 19.5 10.4 17.7 0.9 0.0 2998

Fortress Income Fund Ltd FFAJ.J Hold 17.16 0.1 -0.4 18.80 12.3 11.9 5.4 8.1 0.4 0.0 1377

Growthpoint GRTJ.J Hold 24.86 -0.1 -7.6 27.00 13.1 12.4 17.0 12.8 0.8 0.0 4989

Hyprop HYPJ.J Buy 109 -0.2 -11.0 125.00 17.2 17.4 18.9 14.9 1.1 0.0 1885

LSR LSRGq.L Hold 2.91 0.3 -15.8 2.60 6.2 5.5 8.9 6.6 1.3 9.1 1497

Octodec Investments Ltd OCTJ.J Sell 19.10 -2.9 -16.7 18.00 10.6 9.7 8.6 7.9 0.7 0.0 350

Palm Hills Developments PHDC.CA Hold 4.01 -0.7 32.9 3.80 9.8 7.3 13.1 8.3 1.3 0.0 525

Redefine Properties Ltd RDFJ.J Hold 10.70 -0.4 -8.0 11.50 16.8 15.1 13.0 12.1 1.1 0.0 3793Resilient Property Income Fund Ltd RESJ.J Hold 143 0.1 20.2 140.00 35.3 34.0 17.2 23.0 1.7 0.0 4024SA Corporate Real Estate Fund SACJ.J Hold 4.80 -0.6 -17.9 5.80 12.4 12.5 10.5 9.9 0.8 0.0 781SODIC OCDI.CA Buy 18.50 -1.4 27.7 16.40 9.7 5.9 12.5 8.7 1.5 0.0 355TMG Holding TMGH.CA Buy 9.42 1.2 6.6 11.00 13.0 12.3 14.8 13.7 0.7 1.6 1102Vukile Property Fund Ltd VKEJ.J Hold 19.40 -1.3 -0.1 20.00 13.4 11.6 11.1 12.6 1.0 0.0 936

Telecommunication ServicesDigi Communications DIGI.BX Hold 35.00 -1.4 -12.6 45.00 5.2 4.6 13.4 12.9 8.4 0.0 876Etisalat ETEL.AD Sell 17.20 0.0 -8.5 15.10 6.0 5.7 14.3 13.9 3.3 5.3 40724MegaFon MFONq.L Buy 10.78 0.4 14.1 15.50 5.0 4.7 14.2 11.8 2.8 5.4 6002Mobily 7020.SE Sell 13.59 0.7 -43.4 12.00 5.3 5.0 na na 0.7 0.0 2790MTN Group MTNJ.J Buy 127 -1.3 -3.1 136.00 6.6 6.1 27.6 19.3 2.1 5.5 16033MTS MBT.N Buy 11.08 0.0 21.6 12.50 5.2 4.9 11.3 11.4 4.8 8.1 10842Ooredoo Group ORDS.QA Hold 84.00 -0.2 -21.7 107.00 3.9 3.4 12.5 10.6 1.1 4.8 7012Ooredoo Oman ORDS.OM Buy 0.52 -0.3 -20.9 1.15 1.8 na 7.2 na 1.3 9.6 883Saudi Telecom Company 7010.SE Buy 69.82 -0.3 -3.7 80.00 5.1 5.1 12.9 13.5 2.2 5.7 37232Telecom Egypt ETEL.CA Buy 13.59 1.9 20.0 16.90 6.3 5.4 7.7 6.6 0.7 7.4 1315Telkom SA Ltd TKGJ.J Hold 53.95 -0.2 -29.9 63.00 3.0 3.4 9.2 9.8 1.0 7.8 1945Turk Telekom TTKOM.IS Hold 6.15 -2.2 6.2 6.30 5.1 4.5 13.1 9.0 4.3 0.0 5565Turkcell TCELL.IS Buy 14.08 0.5 31.7 18.00 6.4 5.5 12.4 10.2 2.2 10.0 7984Vodacom VODJ.J Buy 152 -0.7 -4.0 166.00 7.9 7.3 17.3 15.7 9.3 5.2 15677

UtilitiesCEZ CEZP.PR Buy 479 1.7 29.7 500.00 7.7 7.4 13.3 17.9 1.0 6.9 11656Qatar Electricity & Water QEWC.QA Hold 177 0.0 -26.2 215.00 13.2 12.7 12.2 11.0 2.1 4.2 5066



10 November 2017



Latam valuation 11/09/17 Daily YTD Price P/BV (x) Div Yld % (US$ m)Company Ticker Rating Price Change % Change % Target 2017E 2018E 2017E 2018E 2017E 2017E Mkt Cap

Banks

Banco de Chile BCH.N Hold 91.15 0.0 29.4 87.00 19.4 19.3 16.5 15.4 3.1 3.7 15107

Banco do Brasil BBAS3.SA Buy 33.11 -0.2 17.7 39.00 12.1 13.1 7.0 5.8 1.0 3.1 29116

Bancolombia CIB.N Hold 38.16 0.0 4.0 45.00 10.7 12.0 11.8 9.8 1.2 3.3 9176

Banorte GFNORTEO.MX Buy 115 0.0 21.5 143.00 16.6 17.6 12.8 11.0 2.6 4.6 16683

Bladex BLX.N Hold 28.46 0.0 -3.3 25.00 8.5 9.3 12.9 11.4 1.1 5.5 1118

Bradesco BBD.N Hold 10.40 0.0 19.4 8.00 15.6 18.0 9.9 9.0 1.8 3.1 63285

Credicorp BAP.N Buy 206 0.0 33.9 242.00 19.4 18.9 14.4 12.5 2.5 4.9 16465

Itau Unibanco ITUB.N Hold 13.05 0.0 26.9 11.00 20.0 21.0 11.0 9.8 2.2 5.2 84882

Santander Brasil BSBR.N Hold 9.20 0.0 3.5 8.00 12.4 16.2 13.3 11.6 2.0 5.6 34493

Santander Chile BSAC.N Hold 31.07 0.0 42.1 29.00 18.7 18.2 16.6 15.8 3.0 3.6 14638

Santander Mexico BSMX.N Hold 8.23 0.0 14.5 10.00 15.7 15.6 11.8 10.9 1.8 4.1 11156

Consumer Discretionary

Arezzo&Co ARZZ3.SA Hold 48.34 -0.2 92.6 32.00 19.4 16.9 29.2 26.2 6.3 3.1 1318

B2W BTOW3.SA Hold 18.82 -0.2 84.2 16.50 14.7 11.9 na na 2.2 0.0 2661

Cia Hering HGTX3.SA Hold 28.05 -0.2 85.2 23.00 16.9 14.6 17.6 17.1 3.6 4.8 1388

Falabella FAL.SN Hold 6,030 0.3 19.9 7,215.00 17.9 16.9 27.5 24.8 3.3 1.4 23276

Liverpool LIVEPOLC1.MX Buy 131 0.0 -5.4 187.50 10.5 9.1 18.7 14.6 2.0 0.6 9192

Lojas Americanas LAME4.SA Hold 15.83 -0.2 -7.0 18.80 11.2 9.8 73.7 35.4 11.4 0.1 6974

Lojas Renner LREN3.SA Hold 35.76 -0.2 54.1 34.00 17.0 14.3 33.2 27.8 8.2 1.0 7804

Megacable MEGACPO.MX Buy 79.86 0.0 24.6 94.00 9.3 8.5 17.2 15.3 2.8 2.0 3595

Multiplus MPLU3.SA Buy 35.46 -0.2 4.7 54.00 6.9 6.0 10.6 10.4 19.8 9.4 1766

Smiles Fidelidade SA SMLS3.SA Buy 81.20 -0.2 -12.0 97.00 13.1 12.0 12.4 13.8 11.7 7.7 3086

Consumer Staples

Almacenes Exito IMI.CN Buy 16,460 0.1 10.0 23,400.00 6.8 6.3 34.0 21.0 0.8 1.2 2444

AmBev ABEV.N Hold 6.18 0.0 25.9 6.15 16.4 14.0 28.8 24.3 8.0 4.0 97049

Arca Continental AC.MX Hold 125 0.0 25.4 106.00 10.3 7.8 23.3 18.1 3.1 1.9 11574

BRF S.A. BRFS.N Hold 13.25 0.0 -10.2 15.50 9.6 7.8 28.7 15.4 2.5 0.4 10586

CBD-GPA PCAR4.SA Buy 75.41 -0.2 37.5 114.00 8.4 7.7 34.9 26.2 2.5 0.3 6140

CCU CCU.N Hold 26.99 0.0 28.6 25.00 10.4 9.5 25.0 21.7 2.7 2.2 4986

Cencosud CEN.SN Hold 1,870 0.3 5.2 2,000.00 9.2 8.6 18.7 18.0 1.3 1.7 8428

Chedraui CHDRAUIB.MX Hold 37.68 0.0 9.9 40.00 6.7 5.7 18.1 15.8 1.3 0.0 1903

Coca-Cola Femsa KOF.N Hold 67.91 0.0 6.9 80.00 8.8 7.8 18.6 17.1 2.4 2.6 14267

Concha y Toro VCO.N Buy 35.00 0.0 8.1 38.00 11.5 9.3 18.6 14.1 1.6 2.3 1307

Embotelladora Andina AKOb.N Buy 29.01 0.0 29.1 32.00 10.3 9.0 26.4 22.3 3.4 2.4 4577

Femsa FMX.N Buy 86.64 0.0 13.7 114.00 9.2 7.6 22.4 19.4 2.6 1.5 31002

Gruma GRUMAB.MX Buy 255 0.0 4.7 310.00 9.3 8.4 15.5 14.2 2.6 1.1 5772

Grupo Bimbo BIMBOA.MX Buy 44.68 -0.7 2.9 58.00 9.8 8.1 28.2 20.5 3.3 0.7 11011

Kimberly-Clark de Mexico KIMBERA.MX Buy 33.77 0.0 -2.1 41.00 13.7 12.2 24.7 20.9 15.7 4.7 5461

Minerva BEEF3.SA Buy 11.20 -0.2 -8.0 24.25 6.4 5.1 20.1 32.4 6.2 5.8 777

Natura NATU3.SA Hold 29.52 -0.2 28.0 26.50 10.2 9.0 29.4 23.4 9.5 0.9 3907

Soriana SORIANAB.MX Hold 40.51 0.0 -2.5 44.00 7.4 6.5 16.1 13.9 1.2 0.0 3821

Wal-Mart de Mexico WALMEX.MX Hold 44.26 0.0 29.3 47.20 13.6 12.4 24.1 21.9 5.0 5.5 40494

Diversified Financials

B3 BVMF3.SA Buy 23.22 -0.2 40.5 23.00 17.4 14.6 21.4 20.0 0.7 8.2 14666

Bolsa Mexicana BOLSAA.MX Buy 32.43 0.0 28.6 45.00 10.9 10.1 16.7 15.9 na 3.9 1008

Credito Real CREAL.MX Buy 29.74 0.0 17.7 36.00 1.3 1.3 6.5 5.7 1.2 0.8 611

Gentera GENTERA.MX Hold 19.30 0.0 -37.4 35.00 2.0 2.0 8.1 7.0 1.8 4.0 1642

Energy

Petrobras PETR4.SA Hold 16.95 -0.2 13.8 20.80 5.4 4.6 20.2 8.8 0.8 0.2 67856

Petrobras PETR3.SA Hold 17.74 -0.2 4.6 20.80 6.6 5.6 21.1 9.2 1.2 0.1 101517

Industrials

Avianca Holdings S.A. AVH.N Hold 6.83 0.0 -29.1 8.00 15.4 14.6 6.2 5.1 5.0 2.4 6839

Azul S.A. AZUL.N Buy 24.65 0.0 14.7 31.00 23.9 19.6 77.8 57.0 11.2 0.0 7776

Copa Holdings, S.A. CPA.N Buy 122 0.0 34.4 137.00 9.4 9.4 14.5 14.4 2.7 1.6 5180

Embraer ERJ.N Hold 19.87 0.0 4.1 22.00 5.7 6.6 11.5 17.0 0.9 3.3 3676

GOL S.A. GOL.N Buy 21.50 0.0 57.9 27.00 20.0 18.3 73.9 89.4 na 0.2 7472

Grupo Aeromexico AEROMEX.MX Hold 30.50 0.0 -15.6 35.00 8.1 5.6 na 9.2 1.5 0.0 1124

LATAM Airlines Group S.A. LTM.N Buy 13.46 0.0 65.0 15.00 9.4 8.3 38.2 15.0 2.7 0.8 8162

Volaris VLRS.N Hold 10.00 0.0 -33.5 12.00 405.6 60.9 na 103.4 19.8 0.0 10119

Information Technology

Cielo CIEL3.SA Hold 23.25 -0.2 -16.8 26.00 13.0 12.2 15.8 15.1 4.1 1.0 19385

Insurance

Porto Seguro PSSA3.SA Buy 37.00 -0.2 37.3 38.00 na na 11.8 10.5 1.8 3.4 3669

Materials

Antofagasta PLC ANTO.L Sell 977 -2.1 54.1 800.00 6.8 6.8 18.0 18.6 1.7 3.1 12633

Cemex CX.N Buy 8.18 0.0 1.9 11.40 7.7 6.6 17.0 11.4 1.3 0.0 11732

Vale VALE.N Buy 10.39 0.0 36.4 12.00 5.2 4.8 9.4 9.3 1.2 2.7 53765

Telecommunication Services

America Movil AMX.N Buy 17.39 0.0 38.3 21.00 6.0 5.6 19.4 17.6 4.1 0.9 57304

Telefonica Brasil VIV.N Buy 15.25 0.0 18.7 21.00 6.4 5.9 18.0 14.7 1.2 5.4 25753

TIM Participacoes TSU.N Buy 18.30 0.0 56.0 22.00 5.0 4.4 26.6 19.1 1.6 0.5 8859



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Appendix1

Important Disclosures *Other information available upon request Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced from local exchanges via Reuters, Bloomberg and other vendors . Other information is sourced from Deutsche Bank, subject companies, and other sources. For disclosures pertaining to recommendations or estimates made on securities other than the primary subject of this research, please see the most recently published company report or visit our global disclosure look-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr. Aside from within this report, important conflict disclosures can also be found at https://gm.db.com/equities under the "Disclosures Lookup" and "Legal" tabs. Investors are strongly encouraged to review this information before investing. Analyst Certification

The views expressed in this report accurately reflect the personal views of the undersigned lead analyst about the subject issuers and the securities of those issuers. In addition, the undersigned lead analyst has not and will not receive any compensation for providing a specific recommendation or view in this report. Pascal Moura/Mairead Smith

Equity rating key Equity rating dispersion and banking relationships

Buy: Based on a current 12- month view of total share-holder return (TSR = percentage change in share price from current price to projected target price plus pro-jected dividend yield ) , we recommend that investors buy the stock.

Sell: Based on a current 12-month view of total share-holder return, we recommend that investors sell the stock

Hold: We take a neutral view on the stock 12-months out and, based on this time horizon, do not recommend either a Buy or Sell.

Newly issued research recommendations and target prices supersede previously published research.

46 % 47 %

7 %37 % 32 %

17 %0

200

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1000

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1400

1600

Buy Hold Sell

Global Universe

Companies Covered Cos. w/ Banking Relationship

10 November 2017



Additional Information

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Macroeconomic fluctuations often account for most of the risks associated with exposures to instruments that promise to pay fixed or variable interest rates. For an investor who is long fixed rate instruments (thus receiving these cash flows), increases in interest rates naturally lift the discount factors applied to the expected cash flows and thus cause a loss. The longer the maturity of a certain cash flow and the higher the move in the discount factor, the higher will be the loss. Upside surprises in inflation, fiscal funding needs, and FX depreciation rates are among the most common adverse macroeconomic shocks to receivers. But counterparty exposure, issuer creditworthiness, client segmentation, regulation (including changes in assets holding limits for different types of investors), changes in tax policies, currency convertibility (which may constrain currency conversion, repatriation of profits and/or the liquidation of positions), and settlement issues related to local clearing houses are also important risk factors to be considered. The sensitivity of fixed income instruments to macroeconomic shocks may be mitigated by indexing the contracted cash flows to inflation, to FX depreciation, or to specified interest rates – these are common in emerging markets. It is important to note that the index fixings may -- by construction -- lag or mis-measure the actual move in the underlying variables they are intended to track. The choice of the proper fixing (or metric) is particularly important in swaps markets, where floating coupon rates (i.e., coupons indexed to a typically short-dated interest rate reference index) are exchanged for fixed coupons. It is also important to acknowledge that funding in a currency that differs from the currency in which coupons are denominated carries FX risk. Naturally, options on swaps (swaptions) also bear the risks typical to options in addition to the risks related to rates movements. Derivative transactions involve numerous risks including, among others, market, counterparty default and illiquidity risk. The appropriateness or otherwise of these products for use by investors is dependent on the investors' own circumstances including their tax position, their regulatory environment and the nature of their other assets and liabilities, and as such, investors should take expert legal and financial advice before entering into any transaction similar to or inspired by the contents of this publication. The risk of loss in futures trading and options, foreign or domestic, can be substantial. As a result of the high degree of leverage obtainable in futures and options trading, losses may be incurred that are greater than the amount of funds initially deposited. Trading in options involves risk and is not suitable for all investors. Prior to buying or selling an option investors must review the "Characteristics and Risks of Standardized Options”, at http://www.optionsclearing.com/about/publications/character-risks.jsp. If you are unable to access the website please contact your Deutsche Bank representative for a copy of this important document.

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10 November 2017



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CEEMEA & Latam Daybookpg.jrj.com.cn/acc/Res/CN_RES/INVEST/2017/11/10/4630cd86...Deutsche Bank Markets Research Global Periodical CEEMEA & Latam Daybook Date 10 November 2017 Friday,10