GS-China： Real Estate Developers

7/29/2019 GS-China Real Estate Developers

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July 9, 2012

China: Real Estate Developers

Equity Research

Vol down from last weeks high, inventory fell in the 1st week of July

July 2-July 8 transaction volume and ASP

On a wow basis, 26 out of 33 cities with data available saw vol. decrease,

with a group median of -18% (vs. 38% for the week ended July 1). On a yoy

basis, 30 of the 33 cities with data available saw volumes increase, with a

group median of 78% (vs. +79%). Compared with the June 2012 weekly

average, 34 cities with data available saw volumes flat, with a group median

of 0% (vs. +49%). Cities by tiers all retreated from last weeks high, especially

Tier 1 cities. This is similar across regions, especially the Yangtze River Delta

region. In terms of ASP, on a wow basis, 8 out of 12 cities with data available

on median level saw prices decrease by 5% (vs. +6%); on a 3-month

cumulative basis, 11 of 13 cities with data available saw prices increase, with

a group median of 4.2% from the prior 3-month average.

Ytd performance

As of end July 8, 35 cities with data available saw average weekly vol in

July 2% lower than the June average, but 56% higher than that of the 2011

average.Ytd, 15 of the 27 cities with dataavailable on a median level sawvolumes decrease, with a group median of -0.4% yoy (vs. -8% for the week

ended July 1). Compared with 2010, 14 of the 23 cities with data available

saw volumes increase, with a group median of 4% (vs. +1%). In terms of

ASP, 18 out of the 27 cities saw prices decrease ytd, with a group median

of -5% yoy (vs. -4%).

Inventory levels

According to the 12-month rolling GFA sold, average inventory take-up time

(for the 13 cities we track) decreased to 16.0 months compared with 16.3

months at the week ended July 1. Among 13 cities we track: (1) inventory

declined in Beijing, Nanjing, Suzhou, Hangzhou, Qingdao, Guangzhou and

Fuzhou; (2) inventory is stable in Changchun, Shanghai, Shenzhen and

Dongguan; (3) inventory is still growing: in Ningbo and Xiamen.

Investment view

Our Buy ideas: Evergrande (CL), BCD (CL), Zhongnan (CL), CRL, Longfor,

Agile, Greentown, Poly HK, Sunac, Sino-Ocean, Fantasia, Poly (A),

Gemdale, Vanke (A), Vanke (B), and Lushang. Our Sell ideas: SZInv, OCT,

and CWTC. Downside risks: Policy missteps or macro hard landing. Upside

risks: Unexpected government policy easing.

MAJOR CITIES AGGREGATE TRANSACTION VOLUMEAND ASP BY TIERS

Note: (1) Tier 1 cities refer to Beijing, Shanghai, Shenzhen, Guangzhou; Tier 2

cities refer to Tianjin, Nanjing, Chengdu, Changsha, Suzhou, Qingdao, Dalian,

Chongqing, Hangzhou, Sanya, and Xi'an, Tier 3 cities refer t o Nanchang,

Dongguan, Hefei, Kunming, Ningbo, Shantou, and Bengbu. (2) Aggregate

ASP calculation for cities are either on weekly or monthly basis subject to

data availability.

Source: CIA, Gao Hua Securities Research estimates

SUMMARY OF OUR ACTIONABLE STOCK IDEAS

*on our Conviction List.

Source: Datastream, Gao Hua Securities Research estimates

For a special disclosure as to Goldman Sachsinvestments in IFM Investments Limited, seethe statement preceding the Reg ACCertification.

Yi Wang, CFA+86(21)2401-8930 [email protected] Beijing Gao Hua Securities Company Limited

Goldman Sachs does and seeks to do business withcompanies covered in its research reports. As a result,investors should be aware that the firm may have a conflict ofinterest that could affect the objectivity of this report. Investorsshould consider this report as only a single factor in makingtheir investment decision. For Reg AC certification and otherimportant disclosures, see the Disclosure Appendix, or go towww.gs.com/research/hedge.html. Analysts employed by non-US affiliates are not registered/qualified as research analystswith FINRA in the U.S.

Jason Sun+86(10)6627-3187 [email protected] Beijing Gao Hua Securities Company Limited

Vicky Li+86(21)2401-8926 [email protected] Beijing Gao Hua Securities Company Limited

Jacqueline Du+86(10)6627-3147 [email protected] Beijing Gao Hua Securities Company Limited

The Goldman Sachs Group, Inc. Global Investment Research

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6,000T ie r 1 ag g re ga te vo lu me (L HS) T ie r 2 ci ties a gg re ga te vo lu me (L HS)

Tier 3 cit ies aggregate volume (LHS) Tier 1 cit ies aggregate ASP (RHS)

T ie r 2 ci ties a g gr eg at e ASP (RHS) T ie r 3 c it ie s a gg re ga te ASP ( RHS)

(K sqm) (Rmb/sqm)

9/Jul Ticker Rating LCY

Potential

upside/

downside

Variance vs.

share price

Variance vs.

share price

Offshore listed

Evergrande 3333.HK B* HK$ 7.23 71% 8.54 102% 4.76 13%

Fantasia 1777.HK B HK$ 1.33 53% 1.53 76% 0.98 12%

Poly HK 0119.HK B HK$ 5.96 29% 6.37 38% 3.50 -24%

Greentown 3900.HK B HK$ 11.37 2 7% 15 .56 73% 7.92 -12%

Sino Ocean 3377.HK B HK$ 5.37 26% 6.82 60% 3.67 -14%

CRL 1109.HK B HK$ 20.00 2 6% 23 .94 5 0% 14 .44 -9%

Agile 3383.HK B HK$ 13.10 2 4% 15 .83 49% 9.29 -12%

Longfor 0960.HK B HK$ 15.40 2 0% 18 .55 4 5% 10 .89 -15%

Sunac 1918.HK B HK$ 4.10 20% 5.25 54% 2.72 -20%

SZInv 0604.HK S HK$ 1.67 -12% 2.10 11% 1.38 -27%

Offshore average 28% 56% -11%

Onshore listed

Lushang 600223.SS B Rmb 8.23 53% 9.29 72% 5.56 3%

Zhongnan 000961.SZ B* Rmb 17.70 34 % 20 .11 5 3% 12 .07 -8%

BCD 600376.SS B* Rmb 18.00 31 % 19 .85 4 5% 11 .45 -17%

V an ke ( B) 200 002 .S Z B H K$ 1 2.98 27 % 15 .65 54% 9.60 -6%

V an ke ( A) 000 002 .S Z B Rm b 1 2.12 25 % 14 .14 46% 8.96 -7%

Poly 600048.SS B Rmb 15.00 15 % 18 .32 4 1% 11 .39 -12%

Gemdale 600383.SS B Rmb 8.00 15% 9.58 38% 5.95 -14%

CWTC 600007.SS S Rmb 8.50 -19% 9.00 -15% 7.20 -32%

OCT 000069.SZ S Rmb 4.74 -33% 7.50 6% 4.16 -41%

Onshore average 17% 38% -15%

Total average 23% 47% -13%

Bear-case

valuation12-M TP

Bull-case

valuation


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July 9, 2012 China: Real Estate Developers

Goldman Sachs Global Investment Research 2

The author would like to thank Olivia Xiao for her contribution to this report.

Exhibit 1:Ytd transaction volume decreased by a median level of 0.4% yoy among the 27 cities with data availableWeekly and ytd transaction volume comparison of 36 cities

Note: GFA numbers indicated in Chongqing, Hangzhou, Wuhan, Haikou, Kunming, Harbin, Ningbo, Shantou, Xuzhou, Yangzhou, Lianyungang,

and Bengbu are for commodity properties; for others, the numbers refer to residential properties.

Source: CIA.

Volume

0702-0708 wow yoy

vs. 2012 Jun

weekly avg 2012 YTD vs 2011 vs 2010 vs 2009 vs 2008

(k sqm) (%) (%) (%) (k sqm) (%) (%) (%) (%)

Pan-Bohai Rim & North China

Beijing 255 -38% 112% -13% 4,531 23% -9% -43% 10%

Tianjin 173 -42% -6% -9% 3,761 -22% -16% -37% 37%

Qingdao 211 -8% -9% 27% 2,965 -26% -23% -18% 310%Dalian 48 7% n.a. 33% 730 -36% -51% -59% -45%

Changchun 141 -20% 22% 7% 2,361 n.a. n.a. -38% -5%

Jinan n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Harbin 273 -18% 348% 99% 1,953 n.a. n.a. n.a. n.a.

Lianyungang 90 -17% 15% -7% 1,990 n.a. n.a. n.a. n.a.

Yangtze River Delta Region

Shanghai 285 -30% 26% -3% 6,223 -11% -4% -52% -32%

Nanjing 194 -14% 173% 1% 3,399 61% 54% -27% 34%

Suzhou 256 -50% 318% -30% 6,603 178% 235% 54% 223%

Wenzhou 42 50% 135% 7% 580 -8% n.a. -48% n.a.

Hangzhou 257 -31% 224% -11% 4,100 81% 196% 9% 160%

Ningbo 128 -2% 98% 42% 1,649 8% 6% -40% n.a.

Xuzhou 160 -27% 58% -4% 3,033 n.a. n.a. n.a. n.a.

Yangzhou 32 -35% 57% -2% 735 n.a. n.a. n.a. n.a.

Southern China

Shenzhen 72 6% 5% -13% 1,646 11% 27% -59% 2%

Guangzhou 195 -43% 58% -19% 4,517 0% 34% -29% 128%

Fuzhou 47 -14% 34% 12% 936 -15% n.a. -70% 16%

Sanya 14 -11% 132% 14% 510 -34% -48% n.a. n.a.

Xiamen 141 -33% 78% 0% 2,227 91% 84% -13% 301%

Dongguan 114 -28% 37% -15% 2,675 -20% 20% -17% 68%

Huizhou 78 -10% 58% -1% 1,626 10% n.a. n.a. n.a.

Haikou 84 19% 286% 34% 1,226 n.a. n.a. n.a. n.a.

Shantou 15 -28% 59% 1% 378 -40% 4% -17% n.a.

Central & Western China

Chengdu 219 97% 126% 45% 3,971 5% -13% -37% 11%

Changsha 372 -14% 144% 5% 6,953 50% 2% -23% 31%Nanchang 91 -20% 86% -3% 1,784 68% 44% -28% 134%

Guiyang 187 -54% 132% -40% 4,401 n.a. n.a. n.a. n.a.

Baotou 67 20% 23% -1% 1,347 -13% -19% -27% 81%

Chongqing 428 -35% 97% -6% 10,352 38% 1% -12% 67%

Wuhan 433 14% 90% 14% 7,512 n.a. n.a. n.a. n.a.

Hefei n.a. n.a. n.a. n.a. 3,528 -27% 54% n.a. n.a.

Kunming 178 -2% 201% 10% 2,972 -7% 7% 7% n.a.

Bengbu 29 -38% -16% 1% 745 0% n.a. n.a. n.a.

Xi'an 160 n.a. 14% -10% 3,829 -21% -30% -18% 30%

Median 151 -18% 78% 0% 2,675 -0.4% 4% -28% 36%

Up cities 7 30 17 Up cities 12 14 3 17

Down cities 26 3 17 Down cities 15 9 21 3

YTD (Jan 2, 2012 -July 8, 2012) comparisonWeekly Comparison


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Exhibit 2:Ytd ASP decreased by a median level of 5% yoy among the 27 cities with data available27 cities weekly and ytd ASP comparison

Note: GFA numbers indicated in Chongqing, Ningbo, Shantou, and Bengbu are for commodity properties; for others, the numbers refer to residential properties.

Source: CIA.

ASP

0702-0708 wow yoy

vs. 2012

Jun avg 2012YTD vs 2011 vs 2010 vs 2009 vs 2008

(Rmb/sqm) (%) (%) (%) (Rmb/sqm) (%) (%) (%) (%)

Pan-Bohai Rim & North ChinaBeijing 21,061 -2% -19% -1% 20,283 -5% 1% 67% 56%

Tianjin 9,572 -9% 10% -7% 10,000 9% 10% 45% 41%

Qingdao n.a. n.a. n.a. n.a. 7,454 -4% 13% -4% 6%Dalian n.a. n.a. n.a. n.a. 11,770 -6% 13% 46% 63%

Jinan n.a. n.a. n.a. n.a. 7,228 -7% n.a. n.a. n.a.

Yangtze River Delta Region

Shanghai 19,303 0% 28% 8% 15,100 3% 15% 34% 70%

Nanjing n.a. n.a. n.a. n.a. 10,086 -18% -5% 46% 48%

Suzhou n.a. n.a. n.a. n.a. 10,450 -2% 12% 54% 50%

Wenzhou n.a. n.a. n.a. n.a. 18,504 14% n.a. 48% n.a.

Hangzhou n.a. n.a. n.a. n.a. 17,152 -28% -16% 33% 21%

Ningbo 11,099 -11% -15% -10% 11,172 -19% -21% 18% n.a.

Southern China

Shenzhen 18,312 -5% -8% -3% 16,037 -15% -23% 30% 24%

Guangzhou 12,436 2% 7% 0% 13,247 1% 13% 56% 33%

Fuzhou n.a. n.a. n.a. n.a. 12,935 -9% n.a. 89% 74%Sanya 28,182 7% -10% 6% 24,443 20% 12% n.a. n.a.

Xiamen n.a. n.a. n.a. n.a. 13,083 -7% 18% 69% 22%

Dongguan 7,895 -6% -4% -6% 8,776 8% 15% 48% 34%

Huizhou n.a. n.a. n.a. n.a. 5,721 -9% n.a. n.a. n.a.

Shantou 5,854 -20% -24% -18% 6,503 19% 28% 48% n.a.

Central & Western China

Chengdu n.a. n.a. n.a. n.a. 8,678 -5% 22% 82% 61%

Changsha n.a. n.a. n.a. n.a. 5,952 10% 33% 47% 50%

Nanchang n.a. n.a. n.a. n.a. 6,962 -7% 30% 63% 33%

Baotou 4,372 -5% -7% -5% 4,545 -4% 19% 45% 67%

Chongqing 6,522 -6% -10% -4% 6,676 -6% 24% 64% 62%

Hefei n.a. n.a. n.a. n.a. 7,070 11% 8% n.a. n.a.

Bengbu 5,494 3% 9% -1% 5,003 -5% n.a. n.a. n.a.

Xi'an 6,861 n.a. 4% 2% 6,510 0% 15% 46% 52%

Median 9,572 -5% -7% -3% 10,000 -5% 13% 48% 50%

Up cities 4 5 4 Up cities 9 18 21 19

Down cities 8 8 9 Down cities 18 4 1 0

Weekly Comparison YTD (Jan 2, 2012 - July 8, 2012) comparison


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Exhibit 3:We estimate it would take 16.0 months on average to clear the inventory in the13 cities we follow13 cities inventory comparison

Note: (1) Rolling 12 months GFA sold is calculated based on the past 12 months avg. sales velocity; (2) GFA numbers

indicated in Hangzhou and Ningbo are for commodity properties; for others, the numbers refer to residential properties.

Source: CIA, Gao Hua Securities Research estimates.

Exhibit 4:Offshore developers existing NAV discount Exhibit 5:Onshore developers existing NAV discount

Source: Datastream, Gao Hua Securities Research estimates. Source: Datastream, Gao Hua Securities Research estimates.

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25

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(mn sqm)GFA sold in 2011 Avg GFA sold during 06-10 Rolling 12 months GFA sold Inventory as of July 8 2012

Pan Bohai Rim Yangtze River DeltaPearl River Delta

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(%) NAV prem/disc (left scale) Adjusted sector market cap index (right scale)

The off-shore sector market capweighted average discount to NAV is11.4%

Base point2005/12/9=100

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(%) NAV prem/disc (left scale) Adjusted sector market cap index (right scale)

The on-shore sector marketcap weighted averagediscount to NAV is 12.4%


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Other disclosure

Goldman Sachs owns 20% of the common stock of IFM Investments Ltd. Goldman Sachs

does not hold any of the seats on the Companys board of directors. Goldman Sachs may

have other business relationships with the Company.


7/10



Disclosure Appendix

Reg AC

I, Yi Wang, CFA, hereby certify that all of the views expressed in this report accurately reflect my personal views about the subject company orcompanies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specificrecommendations or views expressed in this report.

Investment Profile

The Goldman Sachs Investment Profile provides investment context for a security by comparing key attributes of that security to its peer group andmarket. The four key attributes depicted are: growth, returns, multiple and volatility. Growth, returns and multiple are indexed based on compositesof several methodologies to determine the stocks percentile ranking within the region's coverage universe.

The precise calculation of each metric may vary depending on the fiscal year, industry and region but the standard approach is as follows:

Growth is a composite of next year's estimate over current year's estimate, e.g. EPS, EBITDA, Revenue. Return is a year one prospective aggregateof various return on capital measures, e.g. CROCI, ROACE, and ROE. Multiple is a composite of one-year forward valuation ratios, e.g. P/E, dividendyield, EV/FCF, EV/EBITDA, EV/DACF, Price/Book. Volatility is measured as trailing twelve-month volatility adjusted for dividends.

Quantum

Quantum is Goldman Sachs' proprietary database providing access to detailed financial statement histories, forecasts and ratios. It can be used forin-depth analysis of a single company, or to make comparisons between companies in different sectors and markets.

GS SUSTAIN

GS SUSTAIN is a global investment strategy aimed at long-term, long-only performance with a low turnover of ideas. The GS SUSTAIN focus listincludes leaders our analysis shows to be well positioned to deliver long term outperformance through sustained competitive advantage andsuperior returns on capital relative to their global industry peers. Leaders are identified based on quantifiable analysis of three aspects of corporateperformance: cash return on cash invested, industry positioning and management quality (the effectiveness of companies' management of theenvironmental, social and governance issues facing their industry).

Disclosures

Coverage group(s) of stocks by primary analyst(s)

Yi Wang, CFA: China Property.

China Property: Agile Property Holdings, Beijing Capital Development Co., Beijing Urban Construction Investment Development, China MerchantsProperty (A), China Overseas Grand Oceans Group, China Overseas Land, China Resources Land, China Vanke (A), China Vanke (B), China WorldTrade Center, Country Garden Holdings Company, E-House (China) Holdings Limited, Evergrande Real Estate Group, Fantasia Holding Group Co.,Financial Street Holding Co, Franshion Properties (China), Gemdale Corp, Greentown China Holdings, Guangzhou R&F Properties, Hangzhou BinjiangReal Estate Group Co, Huafa Industrial, IFM Investments, Jiangsu Zhongnan Construction Group Co, KWG Property Holding, Longfor Properties Co.,Lushang Property, Perennial China Retail Trust, Poly (Hong Kong) Investments, Poly Real Estate Group, Powerlong Real Estate Holdings, Risesun RealEstate Development Co, SOHO China, Shanghai Shimao Co., Shenzhen Investment, Shenzhen Overseas Chinese Town Holding, Shimao Property,Shui On Land, Sino-Ocean Land Holdings, Sunac China Holdings, Yanlord Land.

Company-specific regulatory disclosures

The following disclosures relate to relationships between The Goldman Sachs Group, Inc. (with its affiliates, "Goldman Sachs") and companiescovered by the Global Investment Research Division of Goldman Sachs and referred to in this research.

Goldman Sachs expects to receive or intends to seek compensation for investment banking services in the next 3 months: Evergrande Real EstateGroup (HK$4.22)

Goldman Sachs had an investment banking services client relationship during the past 12 months with: Evergrande Real Estate Group (HK$4.22)

Goldman Sachs makes a market in the securities or derivatives thereof: Evergrande Real Estate Group (HK$4.22)


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Goldman Sachs holds a position greater than U.S. $15 million (or equivalent) in the debt or debt instruments of: Evergrande Real Estate Group(HK$4.22)

There are no company-specific disclosures for: Beijing Capital Development Co. (Rmb13.73) and Jiangsu Zhongnan Construction Group Co(Rmb13.18)

Distribution of ratings/investment banking relationships

Goldman Sachs Investment Research global coverage universe

Rating Distribution Investment Banking Relationships

Buy Hold Sell Buy Hold Sell

Global 31% 54% 15% 48% 41% 36%

As of April 1, 2012, Goldman Sachs Global Investment Research had investment ratings on 3,507 equity securities. Goldman Sachs assigns stocks asBuys and Sells on various regional Investment Lists; stocks not so assigned are deemed Neutral. Such assignments equate to Buy, Hold and Sell forthe purposes of the above disclosure required by NASD/NYSE rules. See 'Ratings, Coverage groups and views and related definitions' below.

Price target and rating history chart(s)

Regulatory disclosures

Disclosures required by United States laws and regulations

See company-specific regulatory disclosures above for any of the following disclosures required as to companies referred to in this report: manageror co-manager in a pending transaction; 1% or other ownership; compensation for certain services; types of client relationships; managed/co-managed public offerings in prior periods; directorships; for equity securities, market making and/or specialist role. Goldman Sachs usually makes a

market in fixed income securities of issuers discussed in this report and usually deals as a principal in these securities.The following are additional required disclosures: Ownership and material conflicts of interest: Goldman Sachs policy prohibits its analysts,professionals reporting to analysts and members of their households from owning securities of any company in the analyst's area ofcoverage. Analyst compensation: Analysts are paid in part based on the profitability of Goldman Sachs, which includes investment bankingrevenues. Analyst as officer or director: Goldman Sachs policy prohibits its analysts, persons reporting to analysts or members of theirhouseholds from serving as an officer, director, advisory board member or employee of any company in the analyst's area of coverage. Non-U.S.Analysts: Non-U.S. analysts may not be associated persons of Goldman, Sachs & Co. and therefore may not be subject to NASD Rule 2711/NYSERules 472 restrictions on communications with subject company, public appearances and trading securities held by the analysts.

Distribution of ratings: See the distribution of ratings disclosure above. Price chart: See the price chart, with changes of ratings and price targets inprior periods, above, or, if electronic format or if with respect to multiple companies which are the subject of this report, on the Goldman Sachswebsite at http://www.gs.com/research/hedge.html.

Additional disclosures required under the laws and regulations of jurisdictions other than the United States

The following disclosures are those required by the jurisdiction indicated, except to the extent already made above pursuant to United States lawsand regulations. Australia: Goldman Sachs Australia Pty Ltd and its affiliates are not authorised deposit-taking institutions (as that term is defined in

Evergrande Real Estate Group (3333.HK)

7.23

7.446.29

8.6

8.2

8.08

6.55

6.53

5.93

5.08

43.47

3.39

4.26

4.15

0.00

2.00

4.00

6.00

8.00

10.00

40

45

50

55

60

65

70

75

80

Goldman Sachs rating and stock price target history

Stock Price Currency : Hong Kong Dollar

Source: Goldman Sachs Investment Research for ratings and pri ce targets; FactSet closing pri ces as of 3/31/2012.

The price targets shown should be considered in the context of all prior published Goldman Sachs research, w hich may or

may not have included price targets, as w ell as developments relating to the company, its industry and financial markets.

Rating

Price target

Price target at removal

Covered by Yi Wang, CFA,as of Feb 28, 2010

Not covered by current analyst

MSCI China

IndexPrice

StockPrice Feb 28

M

B

J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M

2009 2010 2011 2012

Beijing Capital Development Co. (600376.SS)

16.5

16.3211.36

18.46

5

10

15

20

25

2,000

2,500

3,000

3,500

4,000

Goldman Sachs r ating and stock price target history

Stock Price Currency : Chinese Renminbi

Source: Goldman Sachs Investment Research for ratings and pric e targets; FactSet closing prices as of 3/31/2012.



Rating

Price target


Covered by Jason Sun,as of Dec 12, 2010


Shanghai - Shenzhen

300

IndexPrice

StockPrice Dec 12

M

B

J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M

2009 2010 2011 2012

Jiangsu Zhongnan Construction Group Co (000961.SZ)

14.68

8.34

12.510.73

0

5

10

15

20

2,000

2,500

3,000

3,500

4,000

Goldman Sachs rating and stock price target history

Stock Price Currency : Chinese Renminbi

Source: Goldman Sachs Investment Research for ratings and pri ce targets; FactSet closing pri ces as of 3/31/2012.



Rating

Price target


Covered by Jason Sun,as of Dec 12, 2010


Mar 7, 2012 to B fromN

Shanghai - Shenzhen

300

Inde

xPrice

Stoc

kPric

Dec 12

N

M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M

2009 2010 2011 2012


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the Banking Act 1959 (Cth)) in Australia and do not provide banking services, nor carry on a banking business, in Australia. This research, and anyaccess to it, is intended only for "wholesale clients" within the meaning of the Australian Corporations Act, unless otherwise agreed by GoldmanSachs. Brazil: Disclosure information in relation to CVM Instruction 483 is available at http://www.gs.com/worldwide/brazil/area/gir/index.html.Where applicable, the Brazil-registered analyst primarily responsible for the content of this research report, as defined in Article 16 of CVM Instruction483, is the first author named at the beginning of this report, unless indicated otherwise at the end of the text. Canada: Goldman, Sachs & Co. hasapproved of, and agreed to take responsibility for, this research in Canada if and to the extent it relates to equity securities of Canadian issuers.Analysts may conduct site visits but are prohibited from accepting payment or reimbursement by the company of travel expenses for suchvisits. Hong Kong: Further information on the securities of covered companies referred to in this research may be obtained on request fromGoldman Sachs (Asia) L.L.C. India: Further information on the subject company or companies referred to in this research may be obtained fromGoldman Sachs (India) Securities Private Limited; Japan: See below. Korea: Further information on the subject company or companies referred toin this research may be obtained from Goldman Sachs (Asia) L.L.C., Seoul Branch. New Zealand: Goldman Sachs New Zealand Limited and itsaffiliates are neither "registered banks" nor "deposit takers" (as defined in the Reserve Bank of New Zealand Act 1989) in New Zealand. This research,and any access to it, is intended for "wholesale clients" (as defined in the Financial Advisers Act 2008) unless otherwise agreed by GoldmanSachs. Russia: Research reports distributed in the Russian Federation are not advertising as defined in the Russian legislation, but are informationand analysis not having product promotion as their main purpose and do not provide appraisal within the meaning of the Russian legislation onappraisal activity. Singapore: Further information on the covered companies referred to in this research may be obtained from Goldman Sachs(Singapore) Pte. (Company Number: 198602165W). Taiwan: This material is for reference only and must not be reprinted without permission.Investors should carefully consider their own investment risk. Investment results are the responsibility of the individual investor. UnitedKingdom: Persons who would be categorized as retail clients in the United Kingdom, as such term is defined in the rules of the Financial ServicesAuthority, should read this research in conjunction with prior Goldman Sachs research on the covered companies referred to herein and should referto the risk warnings that have been sent to them by Goldman Sachs International. A copy of these risks warnings, and a glossary of certain financialterms used in this report, are available from Goldman Sachs International on request.

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Buy (B), Neutral (N), Sell (S) -Analysts recommend stocks as Buys or Sells for inclusion on various regional Investment Lists. Being assigned a Buyor Sell on an Investment List is determined by a stock's return potential relative to its coverage group as described below. Any stock not assigned asa Buy or a Sell on an Investment List is deemed Neutral. Each regional Investment Review Committee manages various regional Investment Lists to aglobal guideline of 25%-35% of stocks as Buy and 10%-15% of stocks as Sell; however, the distribution of Buys and Sells in any particular coveragegroup may vary as determined by the regional Investment Review Committee. Regional Conviction Buy and Sell lists represent investmentrecommendations focused on either the size of the potential return or the likelihood of the realization of the return.

Return potential represents the price differential between the current share price and the price target expected during the time horizon associatedwith the price target. Price targets are required for all covered stocks. The return potential, price target and associated time horizon are stated in each

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Not Rated (NR). The investment rating and target price have been removed pursuant to Goldman Sachs policy when Goldman Sachs is acting in anadvisory capacity in a merger or strategic transaction involving this company and in certain other circumstances. Rating Suspended (RS). GoldmanSachs Research has suspended the investment rating and price target for this stock, because there is not a sufficient fundamental basis fordetermining, or there are legal, regulatory or policy constraints around publishing, an investment rating or target. The previous investment rating andprice target, if any, are no longer in effect for this stock and should not be relied upon. Coverage Suspended (CS). Goldman Sachs has suspendedcoverage of this company. Not Covered (NC). Goldman Sachs does not cover this company. Not Available or Not Applicable (NA). Theinformation is not available for display or is not applicable. Not Meaningful (NM). The information is not meaningful and is therefore excluded.

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