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NLG - OUTPERFORM - Dilution risk partially offset by improved liquidity - Update

The AGM approved a private placement of up to 15mn shares to a strategic partner, priced at around VND19,000 - 21,000 per share, implying up to 10% dilution. NLG shareholders face further dilution as ESOP for FY14 and the new Executive Stock Grant (ESG) programs were approved (additional dilution of up to 6%). 30-day daily avg trading value has improved tenfold since our last report, prompting us to remove a 5% illiquidity discount factored into our valuation.