VIEWPOINTS EXPRESS

For further product information please contact ICBC International Research Limited at (852) 2683 3888 Please read the important notice on last page Stock Market Performance Price Abs%24 Feb chg chgHK Equities Hang Seng Index 22,389 (180) (0.8)- Spot mth fut. 22,378 (Prem.:-11)H-share Index 9,798 (138) (1.4)- Spot mth fut. 9,790 (Prem.:-8)Turnover HK$bn 57.2 (1) (1.5)-% from HSI 35.9 (3)-% CBBC, wrnt 17.7 (1)China Equities CSI 300 Index 2,215 (50) (2.2)Sh Composite Index 7,543 (208) (2.7)Sz Composite Index 1,134 (1) (0.1)Asian Equities Nikkei 225 14,838 (28) (0.2)Korea KOSPI 1,949 (9) (0.4)Taiwan TWSE 8,561 (41) (0.5)India Sensex 30 20,811 1110.5US/European Equities DJIA16,207 104 0.6 S&P500 1,848 11 0.6 NASDAQ 4,293 30 0.7 UK FTSE 100 6,866 28 0.4 Germany DAX 9,709 52 0.5 France CAC40 4,419 38 0.9 Source: Bloomberg Other Indicators PriceAbs Chg24 Febchg%WTI oil $/bl 102.8 0.6 0.6 Gold $/troy oz 1,336.6 15.7 1.2 Cu fut. $/metric ton 7,155.0 0.0 0.0 Al fut. $/metric ton 1,771.0 0.0 0.0 Reuters/Jefferies CRB fut. 302.2 0.6 0.2 Baltic Dry Index 1,175.0 0.0 0.0 UST yield 3m % 0.04 0.00 UST yield 10y % 2.74 0.007 HIBOR 3m % 0.37 (0.002)USD LIBOR 3m % 0.23 (0.001) Source: Bloomberg HK Listco ADR US (Top Ten) ADR cls HK clsChgHK$ eqv.HK$%Petrochina 7.98 7.90 0.97 HSBC 82.30 83.90 (1.90)China Mobile 73.96 73.50 0.62 Sinopec Corp 6.47 6.43 0.66 CNOOC 12.41 12.26 1.24 China Life 22.67 22.65 0.07 Hutchison Whampo 103.54 103.30 0.23 China Telecom 3.47 3.44 1.00 Cheung Kong 118.01 118.80 (0.67)Sun Hung Kai 97.91 97.50 0.42 ImpliedHK clsChg ptHSI 22,345 22,389 (44)H-share Index 9,814 9,798 16 (Note: ADRs account for 39.9% weighting of HSI, 26.9% of H-share Index) Source: Bloomberg Equity Research Market Report VIEWPOINTS EXPRESS 25 February 2014 Belle International (1880.HK, BUY, TP HK$12.00) 2013 Results: Confirming a solid fundamental Belle reported 2013 results with 10.3% YoY sales growth and 3.2% YoY earnings growth. Net profit was slightly better than our estimates and market consensus. Key positive is profitability remains intact on slowing down sales growth, indicating a solid fundament in the company. Management expects a low-single digit SSSG for 2014. We think current valuation is still attractive and maintain Buy. VIEWPOINTS EXPRESS – 25 February 2014 2 Equity Research Belle International Rating BUY 2013 Results: Confirming a solid fundamental Belle reported 2013 results with 10.3% YoY sales growth and 3.2% YoY earnings growth. Net profit was slightly better than our estimates and market consensus. Key positive is profitability remains intact on slowing down sales growth, indicating a solid fundament in the company. Management expects a low-single digit SSSG for 2014. We think current valuation is still attractive and maintain Buy. 2013 results: Belle reported 2013 result with 10.3% YoY sales growth to Rmb36.2bn and 3.2% YoY earnings growth to Rmb4.5bn. Sales growth was contributed by 1) 2% SSSG in footwear and 5.5% SSSG in sportswear and 2) 1,093 net increase in footwear stores to 13,181 and 3) 420 net increase in sportswear stores to 5,894. GP margin expand 100bps on lower cost and less discount, while OP margin squeezed 80bps on increasing labour cost. Views on the result: Positive. Net profit was 3% higher than our estimates and market consensus. We are delighted to see Belle maintains a good profitability among the industry headwinds. We think market had expected a lower margin level due to operating de-leverage, however, the result should relive part of such concerns and improve market confidence. Views on the outlook: The Company believes that consumer sentiment is still weak, and expected an only low-single digit growth for footwear sector in 2014. Store opening pace will be similar to 2013, which is at ~9% for footwear sector. This converts to a top-line growth at low-teens growth. This guidance is slightly lower than our previous expectation for a mid-teens growth in 2014. As there is not obviously sign for a solid rebound in social retail sales and macro economy, we think management’s prudent guidance a