MGG Corporate Presentation August 2012 Final

7/31/2019 MGG Corporate Presentation August 2012 Final

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Legal Disclaimers

This is not an offer to sell or a solicitation of an offer to purchase securities

by Mongolia Growth Group (the Company). Any such offer or

solicitation will only be made by means of the Companys Offering

Documents (e.g., prospectus, offering memorandum, subscription

agreement and or similar documents) and only in jurisdictions where

permitted by law. Investors should refer to the Offering Documents for

more complete information, including investment risks, fees and expenses.

The securities are a highly speculative investment and are not intended as a

complete investment program. They are designed only for sophisticated

persons who can bear the economic risk of the loss of their investment inthe Company and who have limited need for liquidity in their investment.

There can be no assurance that the Company will achieve its objectives.

Target investment goals are not a guarantee of future returns.

The attached material is provided for informational purposes only as of the

date hereof, is not complete, and may not contain certain material

information about the Company, including important disclosures and risk

factors associated with an investment in the Company. This information

does not take into account the particular investment objectives or financial

circumstances of any specific person who may receive it. More complete

disclosures and the terms and conditions relating to a particular investmentis, or will be, contained in the Offering Documents. Before making any

investment, prospective investors should thoroughly and carefully review

the Offering Documents with their financial, legal and tax advisors to

determine whether an investment is suitable for them.

The attached material includes forward-looking statements relating to,

among other things, the future financial performance of and objectives of

the Company; plans and expectations for the operation of the Company;

and estimates or expectations for fees, costs and expenses. These forward-

looking statements are typically identified by terminology such as may,

will, should, expect, anticipates, plans, intends, believes,

estimates, projects, predicts, seeks, potential, continue or other

similar terminology. Forward-looking statements are inherently unreliable,

and prospective investors should not rely on them. The forward-looking

statements are based on the Companys current expectations, assumptions,

estimates and projections about future events. Actual results are subject to

numerous risks and uncertainties that could cause actual results to differ

materially from those expressed in a forward-looking statement as a result

of various factors which may be further described in the Companys

Offering Documents. The Company does not have any obligation to update

or otherwise revise any forward-looking statements in the attached materialor to reflect the occurrence of unanticipated events.

Certain information contained herein have been prepared by third-party

sources, and such information has not been independently audited or

verified by the Company. The Company has used its best efforts to ensure

the accuracy and completeness of the information presented.


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Legal Disclaimers

Forward Looking StatementsThis document, together with any documents incorporated by reference

herein, contains statements about expected future events and financial and

operating results that are forward-looking. From time to time, we may also

provide oral or written forward-looking statements in other materials we

release to the public. Forward-looking statements give our current

expectations or forecasts of future-events. You can identify these

statements by forward-looking words such as "expects", "does not expect",

"plans", "anticipates", "does not anticipate", "believes", "intends",

"estimates", "projects", "potential", "scheduled", "forecast", "budget" and

similar expressions, or that events or conditions "will", "would", "may","could", "should" or "might" occur and similar words. In addition,

statements that we make in this document including any documents

incorporated by reference herein that are not statements of historical fact

may also be forward-looking statements.

Forward-looking statements are not guarantees of our future performance

and involve risks, uncertainties and assumptions that may cause our actual

results to differ materially from the expectations we describe in our

forward-looking statements. For example, some risks, uncertainties and

assumptions include: capital requirements; fluctuations in the international

currency markets and in the rates of exchange of the currencies of Canada

and the United States; price volatility in the spot and forward markets for

commodities; impact of any hedging activities, including margin limits and

margin calls; discrepancies between actual and estimated production and

between actual and estimated reserves and resources; changes in national

and local government legislation in Canada, the United States and

Mongolia or any other country in which the Company currently or may in

the future carry on business; taxation; controls, regulations and political or

economic developments in the countries in which the Company does or

may carry on business; the speculative nature of oil and natural gas

exploration, production and development, including the risks of obtaining

necessary licenses and permits; diminishing quantities or grades of

reserves; competition; loss of key employees, additional funding

requirements; stock market volatility and ability to access sufficient capital

from internal and external sources; actual results of current exploration or

reclamation activities; changes in project parameters as plans continue to be

refined; accidents; labour disputes; and defective title to claims or property

or contests over claims to oil and gas properties. In addition, there are risks

and hazards associated with the business of oil and natural gas exploration,

production and development, including environmental hazards, industrial

accidents, unusual or unexpected formations, pressures, cave-ins and

flooding (and the risk of inadequate insurance or inability to obtaininsurance, to cover these risks). You should not place undue reliance on

forward-looking statements.

We do not promise to notify you if we learn that our assumptions or

projections are wrong for any reason except as required under applicable

securities laws. We do not undertake any obligation to update forward-

looking statements, whether as a result of new information, future events or

otherwise except as required under applicable securities laws. You should

be aware that all the risk factors discussed in this document could cause our

actual results to differ from any forward-looking statements.


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Leverage the tremendousgrowth in Mongolia

Focused on acquiring,constructing and

managing investment realestate in Mongolia while

helping to build the

countrys insurance

industry

Mission Statement


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Rich in mineral wealth Construction of world class mines Proximity to China Experiencing a high teen annual GDP growth rate Hard working and ambitious, pro-Western culture

Why Mongolia?


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Land area: 1.56m sq.km Population: 2.7 million Political System: Democracy Capital: Ulaanbaatar Located between Russia andChina 19th largest country in the

world

GDP (2011): $8,14 Billion* GDP per capita: $2,872* GDP is likely to accelerate

significantly in the future

The Country

*NSO(NationalStatisticalOfficeofMongolia)

Ulaanbaatar


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Two Massive Projects

OyuTolgoiMine(OT)* TavanTolgoiMine(TT)*

JV between Ivanhoe Mines and RioTinto

Contains 81 billion pounds of copperand 46 million ounces of gold

Scheduled to produce 1.2 billionpounds of copper (4% of globalproduction) and 650,000 ounces of

gold each year 59 year mine life

To begin production in 2012. Totalcapital expenditure is estimated at$6.5 billion

Anticipated to account for 30% ofMongolias GDP. Expected to createthousands of direct, high paying, full

time jobs

May be the largest undevelopedcoking coal mining district in theworld, holding in excess of 6 billiontones of coal

Close to Chinese border Multi-billion dollar project began

development in 2011

Huge upside potential for resourcesand annual production

TT is the largest of the manyplanned mid-to-high BTU coalprojects in various stages ofdevelopment in Mongolia

Planned IPO will accelerate currentproduction rates

*IvanhoeMinesLtd.


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A Simple Question

Question: There are tens of billions to be spent on capital projects that are in the planning and development

stages, so how do you put this much capital into

such a small economy?Answer: Get ready for the boom!


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Mongolia Growth Groups Thesis

Mongolia has a small population with huge resource potential We anticipate large GDP and per capita income growth Historical comparables where an open economy has allowed for

wealth creation are Kuwait, Qatar, and Kazakhstan

We want to invest at the inflection point when the first major newmine is being built


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Using Kazakhstan as an InvestmentRoadmap for Mongolia

There Are Many SimilaritiesBetween Kazakhstan And

Mongolia

Both Resource Economies Both Former Soviet Satellites Culturally Similar Similar Soviet Architecture

The Difference is That Kazakhstan is 10 yearsAhead of Mongolia in its Boom


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The Kazakhstan Boom from2002 to 2008

2002 2008 % ChangeKazakhstan Oil Production

(Barrels/Day) *1885,000 1,363,000 54%

Kazakhstan GDP ($ USD

Billions) *2

$24,637 $104,853 326%

Kazakh Tenge (Currency) 3150.67 120.64 20%

Kazakh Stock Exchange Index3104.55 2640.15 2425%

*1: US Department of Energy

*2: World Bank

*3 Bloomberg


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*1: Currently Observed Prices

*2:Cushman & Wakefield, Almaty Office

Current Price in

Almaty, Kazakhstan Current Price inUlaanbaatarDowntown Apartments ($USD

Per Meter)$3,000-$5,2002 $900-$2,0001

Prime Ground Floor Retail Spacein Downtown ($USD Per Meter)

$10,000-$30,0002 $1,500-$3,0001

Current Prices in Ulaanbaatar onthe Eve of the Boom


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Strategy

Focus on:Industries likely to benefit from the

growth in consumer income:

Real Estate Insurance

Ignore:Mining itself:

Tough Industry Capital Intensive Political Boom & Bust Cycles


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Real Estate


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Mongolian Property Rights

Property rights are stronglyprotected by law

Foreigners can own finishedstructures

Foreigners can enter into landleases (max 100 years)

Foreign and local corporationscannot own land


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Only one main street (Peace Avenue)and very few secondary streets

Most activities are concentrated along athree kilometer stretch of Peace Avenue

Very small footprint that everyonewants to be located within

Why Ulaanbaatar Is Unique ForProperty Investors


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Ulaanbaatar City Map

Mountains

Mountains

Ulaanbaatar is constricted by mountains to the north and the south

A single 2-lane east-west road constricts movement and focuses all development into the downtownof approximately 2km North-South by 3 km East-West

Downtown

Airport

Peace Avenue Is Only

Main East-West Road

City Is Constricted ToThe North And South

By Mountains


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View of Downtown UB

DowntownCore

Gandan

Ger District

Parliament

New UN

Building

CentralBusiness

DistrictPeaceAvenue

Seoul Street

RingRoad

North


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Our Portfolio

28 Residential units 6,081 meters of Retail space 5,369 meters of Office space 13,800 meters of RedevelopmentOpportunities


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MGG Property Strategy

Buy top-quality properties along PeaceAvenue and a handful of secondary

streets.

Focus on leasable retail and officeproperty

Focus on redevelopment opportunitieswith sizable value uplift through

redevelopment.


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CurrentPortfolioKey Asset - MGG Headquarters

Approximately 1720 Meters of Office Space


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MGG Portfolio Breakdown

Type # ofMeters # ofProperties At Cost % At Cost

Residential 2,415 28 3.4B MNT 7.9%

Retail 6,081 48 18.1B MNT 42.3%

Office 5,312 8 9.0B MNT 15.5%

Redevelopment 13,800 6 15.8B MNT 34.3%

Total 27,608 90 46.4 MNT 100%

As of July 31, 2012

All data as of July 31, 2012. Percentages are calculated based on property purchase costs in MNT.


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Acquisition Growth Chart

MNT

0

5,000,000,000

10,000,000,000

15,000,000,000

20,000,000,000

25,000,000,000

30,000,000,000

35,000,000,000

40,000,000,000

45,000,000,000

50,000,000,000

Feb

'11Mar

'11Apr

'11May

'11Jun

'11Jul

'11Aug

'11Sept

'11Oct

'11Nov

'11Dec

'11Jan

'12Feb

'12Mar

'12Apr

'12May

'12June

'12Jul

'12

Redevelopment

Office Space

Retail Space

Residential

As of July 31, 2012


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MGG Property Usage Breakdown

All data as of July 31, 2012. Percentages are calculated based on property values.

For the purpose of this chart, MGGs insurance subsidiary, Mandal Daatgal, is considered as a tenant as

it pays rent to MGG. The Property value of the space rented by Mandal is not included undercorporate use.

As of July 31, 2012

47.7%

34.1%

8%1% 4.6%

4.0%

Rented

Redevelopment

Renovation

For Sale

Vacant

Corporate Use


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Monthly Rental RevenueAs of July 31, 2012

MNT

All data as of July 31, 2012 is presented in MNT and includes VAT received. MGGs insurancesubsidiary, Mandal Daatgal, has paid 15,357,760 MNT monthly since March 2012; and paid

10,200,000 MNT in rent to MGG in February 2012 and 4,850,000 in January 2012.

0

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

May

'11Jun '11 Jul '11 Aug'11Sep '11 Oct '11 Nov

'11Dec '11Jan '12 Feb '12Mar '12Apr '12 May

'12Jun' 12 Jul '12

Redevelopment

Office

Retail

Residential


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Rent Breakdown

Type Average Yield1 % of Rent Total

Residential 9.16% 7.8%

Retail

8.7%

49.3%

Office 14.4% 32.2%

Redevelopment 1.7% 10.7%

Total 10.5%* 100%

1Averageyieldiscalculatedasannualrentreceivedasapercentageoftotalpropertyacquisi6oncost

(includingcapitalexpenditures).AlldataispresentedinMNT.

*Totalyieldisbasedonallrentableproper6esthatexcludesland,redevelopmentsandproper6es

underrenova6on.

As of July 31, 2012


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Value Creation Through Redevelopment

High rents in downtown lead to propertyvalues that are many times the replacementcosts of completed structures.

The economic returns from development areabnormally high due to a scarcity of high-

quality land on main streets.

MGG recognized this early and has a veryattractive redevelopment pipeline.


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Redevelopment Strategy

Partner with experienced developers

Contribute land and local experience to aprospective JV

Manage the property afterwards which leads tohigh margin revenues

Avoid outsized financial commitments Avoid completion risk Avoid budgeting risk Retain high returns on capital with reduced risk


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Insurance


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Mandal General Daatgal LLC

Received insurance license on June 2,2011

Operates in various property andcasualty lines of business

Initial capital of US$5m, making itthe best-capitalized insurer in

Mongolia


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Mandal Reinsurance Partners Mandal Corporate ClientsInsurance


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Management Philosophy

Our structure is corporate, but we operate on theprinciples of a long-term partnership

No founding management salaries or options The Board has been chosen based on relevant experience, intellect,

and a deep understanding and coherence to our guiding principles

Our only upside is by creating shareholder value; increasing theintrinsic value of the company on a per share basis

We own a lot of shares and are working for ourselves and ourinvestors


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Mongolia Growth Group Ltd.

Founded in February 2011 Listed on the CNSX - Ticker: YAK 34,143,352 shares outstanding 33.5% Sr. Management and Board

ownership

Approximately $51.5M raised


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Conclusion

According to the International Monetary Fund, Mongolia is

expected to be one of the fastest growing economies in the worldover the next decade.

We want to leverage that growth.