CGPC — Investor Presentation 2016

Nov 16, 2016

China General Plastics Corporation

Schedule	Agenda	Reporter
15:30〜16:00	VIP Registration
16:00〜17:00	Introduction/Market Review & Outlook	Otto HU President
	Finance Information	C.C.Kuo Manager
	Q & A	Fan-Fu Lin G.M.

About CGPC
Reporter : Otto Hu
Vice President
Date : 2016, Nov. 16

China General Plastics Corporation

China General Plastics Corporation (CGPC) was established in 1964. Total capital is over 4.8 billion NT Dollars. CGPC is one of USI group member. Its plant is located in Toufen city, Miaoli county, and in Lin-Yuan, Kaohsiung (named: CGPC Polymer Corporation, is a manufacturer of PVC resin), Taiwan. The General Managing departments are located in USI headquarter at Ji-Hu Road, Nei-Hu District, Taipei, Taiwan.
?CGPC is one of the three largest PVC resin manufacturers in Taiwan, takes an important position in the world in terms of vinyl film production capabilities. In order to fully integrate the upstream and downstream processing of raw materials and fabrication products, production and marketing service areas comprises the production of PVC resin, compound, film, leather, pipes, anti-corrosion liner, waterproofing membrane and wall/partition board.
?To fully integrate from raw material to vinyl film production, our manufacture, services and sales cover the whole spectrum of vinyl product tree, from the first level, i.e. PVC resin, to the second level, i.e. vinyl films and leather.

PVC Resin

PVC Compound

Construction Products

Film and Sheet Products

Leather Products

Suede Leather &
Flocking Leather

Stain Resistance Material

Green Materials

VERDOR GREEN Leather/Film

VERDA GREEN Leather

POLYTEX GREEN Leather

R & D : Special Items for Leather

建材產品
PVC粉
SRT Artificial Leather:
CGPC had obtained the trade mark of FORBID since Mar.29,2016 for selling artificialleather in USA.
The upgrading SRT is still on going.

High-end FR Artificial Leather:
MVSS-302 (Motor Vehicle Safety Standard) for automotive market in North America.
FAR25.853 (Federal Aviation Regulations) for aircraft market in USA.
BS 7176 (Crib 0〜7 of BS 5852) for furniture market in UK.
膠布產品

PVC Market Review for 2016

China
» Import (Jan~Sep) was ↓16% vs 2015 . And export (Jan~Sep)
was ↑ 55% vs 2015, but the volume decreased drastically
since September.
» Domestic price started increasing since Q1 this year. The price
was jumping up since August and reached the 5-year high in
November. Chinese PVC is also pushing all Asian PVC market.
India
» 2016 PVC import (Jan~Oct) was ↑ 27% vs 2015 due to
infrastructure demand. India has been leading the PVC price
in Asia in 1H 2016.
SE Asia
» Vietnam and Indonesia PVC demand (Jan~Sep) was increasing.

PVC Market Review for 2016

Australia
» As AVC stopped PVC operation in January 2016, the original
output of 140 kt has to import instead.
» Due the different import duty, the import PVC prices are very
competitive and lower than the prices in Asia.

Bangladesh
» Bangladesh is one of PVC markets with big demand growth。
» As most of cargos were shipping to India, the supply for
Bangladesh was short.
USA
» PVC output (Jan~Sep) was ↑ 5% vs 2015。
» Both sales for domestic and export (Jan~Sep) was↑ 5% vs 2015.

PVC Outlook for 2017

China
» Due to the cost up in coal, carbide and transportation, Chinese
domestic PVC price is expected moving up or at higher level.
» PVC capacity and production are expected limited because of
environment inspection. The export volume is also limited.
India
» PVC demand is forecasted at 8~10% in line with the good
economic GDP.
» The 2016 year end PVC inventories in major suppliers are
expected low. So, the Indian PVC price should be increasing in
1H 2017.
SE Asia
» Most of cargos from China and Japan are expected to move to
India, PVC will be short in SEA.

PVC outlook for 2017

Australia
» The PVC import duty is expected to remove effective early 2017,
which is an advantage for Taiwan.
» The Sea-Bulk transportation and supply is essential for most of
Australian PVC users. Taiwanese suppliers (especially CGPC) is
well prepared and ready.

Bangladesh
» Besides of infrastructure, the PVC demand for wire, cable and
fitting are also strong. CGPC can still be the number one supplier
to sell here with all grades of product mix.
Iran
» After the sanction lifted by US and EU, PVC demand in Iran has
been improved. The PVC purchase for productions in artificial
leather, film, fitting and wire & cable are potential.

Fabricated Products Review

Construction products
» PVC pipe consumption is expected to drop by 15% due to the
poor housing market.
» The door panel business is still stable because of the
replacements for old house.

PVC Film
» The PVC film demand dropped in house decoration materials
and other local purposes.
» The re-export business in tape, ink-printing and label are
stable in 2016

PVC Leather
» The purposes for bike, furniture, automotive look good in
2016.
» The sales to Norther America is focus on high-end products to
avoid the low price competitions from Vietnam and Mexico.

Fabricated Products Outlook

Construction products
» The scale of housing start has been increasing since three years
ago. And the finished house transactions in some cities
improved in October. There should be a good outlook in 2017.
» CGPC has invested the facility to produce PVC foam board
and plan to start running in early 2017.

PVC film
» The global situations are going to stable, the PVC film demand
is improving in major markets.
» The Non-P PVC film demand is improving due to environment
request in Europe.
» CGPC has invested a new facility to run PVC tape film and
plan the start running in early 2018.

Fabricated Products Outlook

PVC Leather
» In view of used cars to ship from US to Cuba, the PVC
leather replacements for car seats are expected to
increase.
» CGPC are selling SRT leather with FORBID in
automotive, furniture, marine in all markets. The market
size is increasing.
» TPO and TPU materials are potential for shoes,
furniture and bike in Europe and USA.
» The high quality request of FR leather products are
niche for furniture, automotive and aircraft.

Finance Information

Reporter : C.C.Kuo Manager
Date : 2016, Nov. 16

Thank you

Q & A