Nomura : Individual Investor Survey February 2017(PDF 340KB)

News Release

February 2017

16 February 2017

Global Research Division Nomura Securities Co., Ltd.

The Nomura Individual Investor Survey is a monthly survey conducted with the aim of better understanding investing activity by individuals and providing information on related trends.

1. Survey overview

2. Nomura I-View Index falls to 35.0 after rising previous month

   The Nomura Individual Investor Market View Index (Nomura I-View Index), based on respondents' three-month outlook for share prices and calculated by subtracting the percentage of responses for "fall" from that for "rise," was 35.0 in February 2017, falling m-m after having risen the previous month. The Nikkei 225 reference level (6 February 2017 close) was 18,976.71, down

   324.73 from the previous survey (10 January 2017 close of 19,301.44).

3. Increased investor interest in forex

   Respondents were asked to select the factor most likely to affect the stock market over the next three months. The response rate for "forex trends" rose 4.2ppt m-m to 24.7% and it was the only factor for which the response rate rose. The response rate for "market factors & psychological factors" was flat m-m while response rates for all the other factors declined.

4. Appeal of consumer goods sector rises, of automobile sector falls

   On the outlook for sectors over the next three months or so, we calculate a diffusion index (DI) by subtracting the percentage of responses for "unappealing" from that for "appealing." The DI for the consumer goods sector rose 11.1pt m-m to 3.0, becoming positive for the first time in six months. In contrast, the DI for the automobile sector fell 19.7pt to -19.3, taking it into negative territory for the first time in six months.

5. Rise in number of investors expecting slight yen appreciation against US dollar

   On the outlook for USD/JPY over the next three months, the combined percentage of respondents expecting the yen to appreciate against the US dollar was 63.9%, up 10.9ppt from the previous month. The response rate for "rise of about ¥5 against the dollar" rose 12.5ppt m-m to 41.6%. The response rate for "rise of about ¥10 against the dollar" fell 1.5ppt m-m to 17.5%, while that for "rise of more than ¥10 against the dollar" fell 0.1ppt m-m to 4.8%.

   The response rate for "fall of about ¥5 against the dollar" declined 10.8ppt m-m to 26.9%, while that for "fall of about ¥10 against the dollar" declined 1.0ppt to 6.7%. In contrast, the response rate for "fall of more than ¥10 against the dollar" rose 0.9ppt m-m to 2.5%.

6. Investment appeal of US dollar declines sharply

   On the outlook for different currencies over the next three months, we calculate a DI for each currency by subtracting the percentage of responses for "unappealing" from that for "appealing." This month the DI for the US dollar declined by 15.7pt m-m to 22.7, marking its largest-ever margin of decline (with the period covered starting in January 2010). The DI for the yen, meanwhile, rose for the first time in three months, by 7.4pt to 29.7. The DI for the yuan rose for the first time in seven months, by 6.6pt to -43.2.

7. Appeal of Japanese equities and cash & deposits among financial instruments rises

   To give an indication of plans for holding financial instruments, we calculate DIs for each type of financial instrument by subtracting the percentage of respondents planning to cease holding the instrument or decrease their holdings from the percentage planning to hold the instrument for the first time or increase their holdings. The DI for Japanese equities rose m-m for the third straight month, by 2.0pt to 40.9, while that for cash & deposits also rose m-m, by 1.7pt to 31.1. In contrast, the DI for foreign bonds declined 1.5pt m-m to 0.9.

8. Lower percentage of respondents expect prices to be higher one year out

   When asked for their outlook for prices of regularly purchased goods and services one year out, the percentage of respondents selecting one of the "rise" responses increased 2.2ppt to 36.2%, while the percentage selecting one of the "fall" responses rose 1.4ppt m-m to 18.0%. The proportion of respondents selecting the "no change" response rose 0.8ppt m-m to 45.8%.

9. Shareholder returns

10. For this month's spot question, we asked about shareholder returns. When we asked respondents what dividend yield they expected when they invested in Japanese equities, the highest response rate, at 31.4%, was for "2% or more but less than 3%." This was followed by "3% or more but less than 4%," at 22.0%, and "1% or more but less than 2%," at 20.3%.

    Next we asked investors in Japanese equities which company shareholder return policies they focused on. The greatest number, with a response rate of 73.5%, selected "cash dividends," followed by "shareholder perks," at 51.7%.

11. Survey results

12. Nomura I-View Index falls to 35.0 after rising previous month

    The Nomura Individual Investor Market View Index (Nomura I-View Index), based on respondents' three-month outlook for share prices and calculated by subtracting the percentage of responses for "fall" from that for "rise," was 35.0 in February 2017, falling m-m after having risen the previous month. The Nikkei 225 reference level (6 February 2017 close) was 18,976.71, down

    324.73 from the previous survey (10 January 2017 close of 19,301.44) (Figure 1).

    Fig. 1: The Nomura I-View Index and reference level of Nikkei 225 at time of survey

    (DI)

    80

    70

    Nomura I-View Index (lhs) Past average for index (lhs)

    Nikkei 225 at time of survey (rhs)

    (¥)

    22,000

    20,000

    60 18,000

    50 16,000

    40 14,000

    30 12,000

    20 10,000

    10 8,000

    (yy/m)

    0

    06/4 07/1 07/10 08/7 09/4 10/1 10/10 11/8 12/5 13/2 13/11 14/8 15/5 16/2 16/11

    6,000

    Note: (1) The Nomura I-View Index is based on data collected by this survey and expressed as a diffusion index (DI). The calculation method is as follows: ([(number of responses indicating expected rise in share prices in the next three months) minus (number of responses indicating expected fall in share prices in the next three months)] divided by number of respondents) x 100. The figure for January 2010 used here excludes those respondents who projected that the Nikkei 225 would be flat. (2) The Nomura I- View Index ranges from -100 to +100. The closer to +100, the more bullish the outlook held by individual investors. The closer to -100, the more bearish the outlook held by individual investors.

    The combined proportion of respondents expecting the Nikkei 225 to fall over the next three months was 32.5%, up 1.2ppt from 31.3% the previous month. The proportion of respondents expecting a "fall of about 1,000 points" rose 3.7ppt m-m to 24.6%, the proportion expecting a "fall of about 2,000 points" fell 2.1ppt to 4.5%, and the proportion expecting a "fall of more than 2,000 points" declined 0.4ppt to 3.4%.

    The proportion of respondents expecting a "rise of about 1,000 points" fell 8.1ppt m-m to 38.4%, while the proportion expecting a "rise of about 2,000 points" rose 4.2ppt to 21.5% and the proportion expecting a "rise of more than 2,000 points" rose 2.7ppt to 7.6% (Figure 2).

    Fig. 2: Outlook for Nikkei 225 during the next three months

    Rise of more than 2,000 points

    Rise of about 2,000 points

    Rise of about 1,000 points

    Fall of about 1,000 points

    Fall of about 2,000 points

    Jan 2017

    Fall of more than 2,000 points

    Feb 2017

    0 5 10 15 20 25 30 35 40 45 50

    (% of responses)

    Note: Respondents were asked to share their outlook for the Nikkei 225 over the next three months based on the 6 February 2017 close of 18,976. Respondents could choose one answer from six possible responses ranging from a rise of more than 2,000 points to a fall of more than 2,000 points, with 1,000-point increments in between.

13. Increased investor interest in forex

    Respondents were asked to select the factor most likely to affect the stock market over the next three months. The response rate for "forex trends" rose 4.2ppt m-m to 24.7% and it was the only factor for which the response rate rose. The response rate for "market factors & psychological factors" was flat m-m, while response rates for all the other factors declined (Figure 3).

    Fig. 3: Impact of factors on the stock market

    International affairs

    Forex trends

    Domestic interest rates

    Domestic politics

    Domestic corporate earnings

    Market factors & psychological factors

    Weather & natural disasters

    Jan 2017

    Feb 2017

    0 10 20 30 40 50 60 70

    (% of responses)

    Note: Respondents were asked to choose one answer from seven possible responses concerning factors likely to impact the stock market over the next three months or so.

14. Appeal of consumer goods sector rises, of automobile sector falls

    On the outlook for sectors over the next three months or so, we calculate a diffusion index (DI) by subtracting the percentage of responses for "unappealing" from that for "appealing." The DI for the consumer goods sector rose 11.1pt m-m to 3.0, becoming

    positive for the first time in six months. In contrast, the DI for the automobile sector fell 19.7pt to -19.3, taking it into negative territory for the first time in six months (Figures 4 and 5).

    Fig. 4: Investment appeal by sector

    Sector	DI	Breakdown of DI (% of responses)		(Ref) Previous DI
    		Appealing	Unappealing
    Pharmaceuticals	10.5	15.9	5.4	6.7
    Capital goods/other	4.7	9.8	5.1	4.6
    Telecommunications	4.2	7.2	3.0	2.3
    Consumer goods	3.0	14.6	11.6	-8.1
    Materials	1.6	12.0	10.4	0.5
    Financials	1.2	13.6	12.4	1.9
    Electrical equipment/precision equipment	-2.0	8.1	10.1	-1.4
    Transportation and utilities	-3.9	6.9	10.8	-6.9
    Automobiles	-19.3	11.9	31.2	0.4

    Note: Respondents were given nine sectors and asked to choose one they viewed as an appealing investment target and one they viewed as unappealing. For each sector, we calculated a DI by subtracting the percentage of responses for "unappealing" from that for "appealing." The materials sector comprises mining, textiles, paper & pulp, chemicals, oil, ceramics, steel, nonferrous metals, and trading houses. The financial sector comprises banks, miscellaneous finance, securities, and insurance. The capital goods/other sector comprises construction, machinery, shipbuilding, transportation equipment, miscellaneous manufacturing, and real estate. The transportation and utilities sector comprises railroads & buses, trucking, shipping, airlines, warehousing, electric power, and gas. The consumer goods sector comprises marine products, food, retail, and services.

    Fig. 5: DIs for investment appeal of selected sectors

    (DI) 30

    20

    10

    0

    -10

    -20

    -30

    12/1

    12/3

    12/5

    12/7

    12/9

    12/11

    13/1

    13/3

    13/5

    13/7

    13/9

    13/11

    14/1

    14/3

    14/5

    14/7

    14/9

    14/11

    15/1

    15/3

    15/5

    15/7

    15/9

    15/11

    16/1

    16/3

    16/5

    16/7

    16/9

    16/11

    17/1

    -40

    Automobiles Financials

    Capital goods/other Pharmaceuticals

    Electrical equipment/ precision equipment

    Materials

    Telecommunications

    Transportation and utilities

    Consumer goods

    (yy/m)

15. Most-watched stocks

    Respondents were asked to name one stock that they would like to have in their portfolio, irrespective of short- or long-term investment horizon (including stocks actually held) or that they found appealing. We show the most popular responses in Figure 6.

    Fig. 6: Name a stock with appeal (1,000 valid responses)

    Code	Company	No. of respondents
    7203	Toyota Motor	99
    8306	Mitsubishi UFJ Financial Group	30
    9984	Softbank Group	30
    4502	Takeda Pharmaceutical	26
    8411	Mizuho Financial Group	24
    9202	ANA Holdings	17
    8267	Aeon	16
    6752	Panasonic	14
    7751	Canon	14
    9437	NTT Docomo	13
    4528	Ono Pharmaceutical	11
    6758	Sony	11
    7201	Nissan Motor	9
    7974	Nintendo	9
    2931	Euglena	8

    Code	Company	No. of respondents
    3402	Toray Industries	8
    4661	Oriental Land	8
    4901	Fujifilm Holdings	8
    6501	Hitachi	8
    6594	Nidec	8
    7267	Honda Motor	8
    2811	Kagome	7
    2897	Nissin Foods Holdings	7
    4568	Daiichi Sankyo	7
    5401	Nippon Steel & Sumitomo Metal	7
    6902	Denso	7
    8001	Itochu	7
    9432	Nippon Telegraph and Telephone	7
    9861	Yoshinoya Holdings	7

    Note: Not included in valid responses were answers of "none" or clearly mistaken responses.

16. Rise in number of investors expecting slight yen appreciation against US dollar

    On the outlook for USD/JPY over the next three months, the combined percentage of respondents expecting the yen to appreciate against the US dollar was 63.9%, up 10.9ppt from the previous month. The response rate for "rise of about ¥5 against the dollar" rose 12.5ppt m-m to 41.6%. The response rate for "rise of about ¥10 against the dollar" fell 1.5ppt m-m to 17.5%, while that for "rise of more than ¥10 against the dollar" fell 0.1ppt m-m to 4.8%.

    The response rate for "fall of about ¥5 against the dollar" declined 10.8ppt m-m to 26.9% while that for "fall of about ¥10 against the dollar" declined 1.0ppt to 6.7%. In contrast, the response rate for "fall of more than ¥10 against the dollar" rose 0.9ppt m-m to 2.5% (Figure 7).

    Fig. 7: Respondents' three-month outlook for USD/JPY

    Fall of more than ¥10 against the dollar

    Fall of about ¥10 against the dollar

    Fall of about ¥5 against the dollar

    Rise of about ¥5 against the dollar

    Rise of about ¥10 against the dollar

    Rise of more than ¥10 against the dollar

    Jan 2017

    Feb 2017

    0 5 10 15 20 25 30 35 40 45

    (% of responses)

    Note: Respondents were asked to share their outlook for USD/JPY over the next three months, referencing a 6 February 2017 indicative rate of 112.45. They could choose one answer from six possible responses ranging from a rise of more than ¥10 against the dollar to a fall of more than ¥10 against the dollar, with ¥5 increments in between.

17. Investment appeal of US dollar declines sharply

    On the outlook for different currencies over the next three months, we calculate a DI for each currency by subtracting the percentage of responses for "unappealing" from that for "appealing." This month the DI for the US dollar declined by 15.7pt m-m to 22.7, marking its largest-ever margin of decline (in the period beginning January 2010). The DI for the yen rose for the first time in three months, by 7.4pt m-m to 29.7. The DI for the yuan rose for the first time in seven months, by 6.6pt to -43.2 (Figures 8 and 9).

    Fig. 8: Investment appeal by currency

    Currency	DI	Breakdown of DI (% of responses)		(Ref) Previous DI
    		Appealing	Unappealing
    Japanese yen	29.7	37.0	7.3	22.3
    US dollar	22.7	34.6	11.9	38.4
    Australian dollar	13.1	14.9	1.8	11.3
    Canadian dollar	1.1	1.8	0.7	1.2
    Pound sterling	-4.2	3.3	7.5	-4.4
    Euro	-8.1	3.3	11.4	-7.7
    Brazilian real	-12.1	2.5	14.6	-11.6
    Chinese yuan	-43.2	1.0	44.2	-49.8

    Note: Respondents were given nine possible responses, consisting of the above eight currencies and "other," and asked to choose one they viewed as an appealing investment target and one they viewed as unappealing. Those selecting "other" were asked to specify a currency.

    Fig. 9: DIs for investment appeal of selected currencies

    (DI) 60

    40

    20

    0

    -20

    -40

    -60

    10/1

    10/4

    10/7

    10/10

    11/1

    11/4

    11/7

    11/10

    12/1

    12/4

    12/7

    12/10

    13/1

    13/4

    13/7

    13/10

    14/1

    14/4

    14/7

    14/10

    15/1

    15/4

    15/7

    15/10

    16/1

    16/4

    16/7

    16/10

    17/1

    -80

    (yy/m)

    USD

    JPY

    AUD

    CAD

    GBP

    EUR

    BRL

    CNY

18. Appeal of Japanese equities and cash & deposits among financial instruments rises

    To give an indication of plans for holding financial instruments, we calculate DIs for each type of financial instrument by subtracting the percentage of respondents planning to cease holding the instrument or decrease their holdings from the percentage planning to hold the instrument for the first time or increase their holdings. The DI for Japanese equities rose m-m for the third straight month, by 2.0pt to 40.9, while that for cash & deposits also rose m-m, by 1.7pt to 31.1. In contrast, the DI for foreign bonds declined 1.5pt m-m to 0.9 (Figures 10 and 11).

    Fig. 10: Financial instruments for which investors are planning either to increase or to decrease their holdings

    Financial instrument	DI	Breakdown of DI (% of responses)		(Ref) Previous DI
    		Plan to increase	Plan to decrease
    Japanese equities	40.9	51.9	11.0	38.9
    Cash & deposits	31.1	35.9	4.8	29.4
    Japanese investment trusts	11.4	17.5	6.1	11.7
    Gold	9.6	10.0	0.4	9.0
    Foreign equities	8.1	9.2	1.1	8.6
    Japanese bonds	5.2	7.3	2.1	4.1
    Foreign investment trusts	4.3	6.5	2.2	3.8
    Hybrid securities	1.5	2.2	0.7	1.8
    Foreign bonds	0.9	2.8	1.9	2.4
    Other	0.5	0.8	0.3	0.6
    None	-47.4	28.1	75.5	-46.2

    Note: Respondents were given a list of 11 responses and asked to choose those financial instruments for which they planned to increase their holdings and those for which they planned to decrease their holdings (multiple responses were allowed). "Plan to increase" refers to financial instruments that investors plan to hold for the first time or for which they plan to increase their holdings, while "plan to decrease" refers to instruments that investors plan to cease holding or for which they plan to decrease their holdings. Hybrid securities and gold were added to the list of choices from the February 2012 survey. Since the April 2013 survey, we have divided the former category of "Securities issued overseas" into foreign equities, foreign investment trusts, and foreign bonds.

    Fig. 11: DIs for financial instruments in which investors are planning either to increase or to decrease their holdings

    (DI) 50

    45

    Japanese equities

    40

    35

    Cash & deposits

    30

    25 Securities issued

    overseas

    20

    15Japanese

    investment trusts

    10

    Japanese bonds

    5

    0

    Note: "Securities issued overseas" is the total for foreign equities, foreign investment trusts, and foreign bonds.

    (yy/m)

19. Lower percentage of respondents expect prices to be higher one year out

    When asked for their outlook for prices of regularly purchased goods and services one year out, the percentage of respondents selecting one of the "rise" responses increased 2.2ppt m-m to 36.2%, while the percentage selecting one of the "fall" responses rose 1.4ppt m-m to 18.0%. The proportion selecting the "no change" response rose 0.8ppt m-m to 45.8% (Figure 12).

    Fig. 12: Outlook for prices one year out

    Choices	% of responses	(Ref) Previous % of responses
    1	Fall of 5% or more	2.0	2.3
    2	Fall of 2% up to 5%	5.2	4.4
    3	Fall of less than 2%	10.8	9.9
    4	No change (0%)	45.8	45.0
    5	Rise of less than 2%	28.5	29.6
    6	Rise of 2% up to 5%	6.4	7.5
    7	Rise of 5% or more	1.3	1.3
    Total	100	100

    Note: Respondents were asked to select one response to the question: "How do you expect prices of regularly purchased goods and services to differ from current levels one year out?"

20. Shareholder returns

21. For this month's spot question, we asked about shareholder returns. When we asked respondents investing in Japanese equities what dividend yield they expected, the largest response rate, at 31.4%, was for "2% or more but less than 3%." This was followed by "3% or more but less than 4%," at 22.0%, and "1% or more but less than 2%," at 20.3% (Figure 13).

    Fig. 13: Expected levels of dividend yield (1,000 responses)

    Choices	No. of responses	% of responses
    1	0% (no dividend) acceptable	35	3.5
    2	Less than 1% (excluding no dividend)	76	7.6
    3	1% or more but less than 2%	203	20.3
    4	2% or more but less than 3%	314	31.4
    5	3% or more but less than 4%	220	22.0
    6	4% or more but less than 5%	66	6.6
    7	5% or more	86	8.6
    Number of responses	1,000	100.0

    Note: Respondents were asked to choose one of a possible seven answers to the following question: When investing in Japanese stocks, what level of dividend yield do you seek?

    Next, we asked investors which company shareholder return policies they focused on when they invested in Japanese equities. The highest response rate, of 73.5%, was for "cash dividends," followed by "shareholder perks," at 51.7% (Figure 14).

    Fig. 14: Shareholder return policies on which investors focus (1,000 responses)

    Choices	No. of responses	% of responses
    1	Cash dividends	735	73.5
    2	Shareholder perks	517	51.7
    3	Share buybacks	152	15.2
    4	Stock splits	119	11.9
    5	None in particular	70	7.0
    Number of responses	1,000	100.0

    Note: Respondents were asked to choose one of the answers given to the following question: When investing in Japanese stocks, which company shareholder return policy do you focus on? (Multiple responses allowed.)

22. Nomura Individual Investor Survey

    With the aim of better understanding investing activity by individuals and providing information on those trends, Nomura Securities conducts a monthly survey-the Nomura Individual Investor Survey. The results of the survey have been published monthly since April 2006.

    Survey method: Questionnaire conducted electronically using the internet monitor questionnaire service administered by Nomura Investor Relations Co., Ltd.

    Survey target: Survey sent to 3,000 individual investors randomly selected from the approximately 24,000 with equity investment experience participating in Nomura Investor Relations' internet monitor questionnaire service.

    Number of responses: 1,000 (survey closed when 1,000 responses received).

    Survey period: Survey distributed on 6 February, with deadline for responses on 7 February.

    Survey content: Questions included each month are (1) share price outlook, (2) factors expected to impact the stock market,

    (3) attractive sectors and stocks, (4) USD/JPY outlook and attractive currencies, (5) financial instruments for which investors plan to change their holdings, and (6) inflation outlook (since July 2013). Respondents are also asked spot questions each month and queried about their personal profiles.

23. Nomura Individual Investor Survey (February 2017) respondents

24. Gender: Male (84.1%), female (15.9%)

    Age: Under 30 (1.3%), 30-39 (8.5%), 40-49 (21.2%), 50-59 (29.7%), 60 and above (39.3%)

    Occupation: Self-employed/fisheries, agriculture, forestry (6.2%), professional (physician/medical professional, lawyer, etc) (2.8%), company management/corporate officer (3.4%), company employee/public servant (47.4%), student (0.2%), full-time homemaker (7.6%), part-time worker/casual worker/job-hopper (6.2%), unemployed/pensioner (24.2%), other (2.0%)

    Region: Kanto (50.1%), Kinki (19.0%), Tokai/Koshinetsu/Hokuriku (15.5%), Hokkaido/Tohoku (5.6%), Chugoku/Shikoku/Kyushu

    (9.8%)

    Financial assets held: Less than ¥1,000,000 (6.4%), ¥1,000,000-¥2,999,999 (9.1%), ¥3,000,000-¥4,999,999 (11.3%),

    ¥5,000,000-¥9,999,999 (15.9%), ¥10,000,000-¥29,999,999 (30.4%), ¥30,000,000-¥49,999,999 (11.8%), ¥50,000,000 or more

    (15.1%)

    Value of domestic stocks held: Less than ¥500,000 (10.7%), ¥500,000-¥999,999 (13.5%), ¥1,000,000-¥2,999,999 (22.1%),

    ¥3,000,000-¥4,999,999 (15.5%), ¥5,000,000-¥9,999,999 (15.8%), ¥10,000,000-¥29,999,999 (15.7%), ¥30,000,000 or more

    (6.7%)

    Investment experience: Less than three years (4.0%), three years to less than five years (8.5%), five years to less than 10 years (22.0%), 10 years to less than 20 years (28.2%), 20 years or more (37.3%)

    Investment plan for domestic stocks: Mainly for long-term holding (46.7%), pursuit of gains from short-term appreciation (14.0%), pursuit of dividends and shareholder perks (26.6%), no particular plan (12.7%)

    Notice

    The next Nomura Individual Investor Survey (March 2017) is scheduled for release on Thursday, 16 March 2017.

    Any Authors named on this report are Research Analysts unless otherwise indicated Important Disclosures

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    Distribution of ratings (Nomura Group)

    The distribution of all ratings published by Nomura Group Global Equity Research is as follows:

    50% have been assigned a Buy rating which, for purposes of mandatory disclosures, are classified as a Buy rating; 39% of companies with this rating are investment banking clients of the Nomura Group*. 0% of companies (which are admitted to trading on a regulated market in the EEA) with this rating were supplied material services** by the Nomura Group.

    42% have been assigned a Neutral rating which, for purposes of mandatory disclosures, is classified as a Hold rating; 52% of companies with this rating are investment banking clients of the Nomura Group*. 0% of companies (which are admitted to trading on a regulated market in the EEA) with this rating were supplied material services by the Nomura Group

    8% have been assigned a Reduce rating which, for purposes of mandatory disclosures, are classified as a Sell rating; 7% of companies with this rating are investment banking clients of the Nomura Group*. 0% of companies (which are admitted to trading on a regulated market in the EEA) with this rating were supplied material services by the Nomura Group.

    As at 31 December 2016.

    *The Nomura Group as defined in the Disclaimer section at the end of this report.

    ** As defined by the EU Market Abuse Regulation

    Distribution of ratings (Instinet, LLC)

    The distribution of all ratings published by Instinet, LLC Equity Research is as follows:

    53% have been assigned a Buy rating which, for purposes of mandatory disclosures, are classified as a Buy rating; Instinet LLC has provided investment banking services to 0% of companies with this rating within the previous 12 months.

    42% have been assigned a Neutral rating which, for purposes of mandatory disclosures, is classified as a Hold rating; Instinet LLC has provided investment banking services to 0% of companies with this rating within the previous 12 months.

    5% have been assigned a Reduce rating which, for purposes of mandatory disclosures, are classified as a Sell rating; Instinet LLC has provided investment banking services to 0% of companies with this rating within the previous 12 months.

    Definition of Nomura Group's equity research rating system and sectors

    The rating system is a relative system, indicating expected performance against a specific benchmark identified for each individual stock, subject to limited management discretion. An analyst's target price is an assessment of the current intrinsic fair value of the stock based on an appropriate valuation methodology determined by the analyst. Valuation methodologies include, but are not limited to, discounted cash flow analysis, expected return on equity and multiple analysis. Analysts may also indicate expected absolute upside/downside relative to the stated target price, defined as (target price - current price)/current price.

    STOCKS

    A rating of 'Buy', indicates that the analyst expects the stock to outperform the Benchmark over the next 12 months. A rating of 'Neutral', indicates that the analyst expects the stock to perform in line with the Benchmark over the next 12 months. A rating of 'Reduce', indicates that the analyst expects the stock to underperform the Benchmark over the next 12 months. A rating of 'Suspended', indicates that the rating, target price and estimates have been suspended temporarily to comply with applicable regulations and/or firm policies. Securities and/or companies that are labelled as 'Not rated' or shown as 'No rating' are not in regular research coverage. Investors should not expect continuing or additional information from Nomura relating to such securities and/or companies. Benchmarks are as follows: United States/Europe/Asia ex- Japan: please see valuation methodologies for explanations of relevant benchmarks for stocks, which can be accessed at: http://go.nomuranow.com/research/globalresearchportal/pages/disclosures/disclosures.aspx; Global Emerging Markets (ex-Asia): MSCI Emerging Markets ex-Asia, unless otherwise stated in the valuation methodology; Japan: Russell/Nomura Large Cap.

    SECTORS

    A 'Bullish' stance, indicates that the analyst expects the sector to outperform the Benchmark during the next 12 months. A 'Neutral' stance, indicates that the analyst expects the sector to perform in line with the Benchmark during the next 12 months. A 'Bearish' stance, indicates that the analyst expects the sector to underperform the Benchmark during the next 12 months. Sectors that are labelled as 'Not rated' or shown as 'N/A' are not assigned ratings. Benchmarks are as follows: United States: S&P 500; Europe: Dow Jones STOXX 600; Global Emerging Markets (ex-Asia): MSCI Emerging Markets ex-Asia. Japan/Asia ex-Japan: Sector ratings are not assigned.

    Target Price

    A Target Price, if discussed, indicates the analyst's forecast for the share price with a 12-month time horizon, reflecting in part the analyst's estimates for the company's earnings. The achievement of any target price may be impeded by general market and macroeconomic trends, and by other risks related to the company or the market, and may not occur if the company's earnings differ from estimates.

    Disclaimers

    This publication contains material that has been prepared by the Nomura Group entity identified on page 1 and, if applicable, with the contributions of one or more Nomura Group entities whose employees and their respective affiliations are specified on page 1 or identified elsewhere in the publication. The term "Nomura Group" used herein refers to Nomura Holdings, Inc. and its affiliates and subsidiaries including: Nomura Securities Co., Ltd. ('NSC') Tokyo, Japan; Nomura International plc ('NIplc'), UK; Nomura Securities International, Inc. ('NSI'), New York, US; Instinet, LLC ('ILLC'); Nomura International (Hong Kong) Ltd. ('NIHK'), Hong Kong; Nomura Financial Investment (Korea) Co., Ltd. ('NFIK'), Korea (Information on Nomura analysts registered with the Korea Financial Investment Association ('KOFIA') can be found on the KOFIA

    Intranet at http://dis.kofia.or.kr); Nomura Singapore Ltd. ('NSL'), Singapore (Registration number 197201440E, regulated by the Monetary Authority of Singapore); Nomura Australia Ltd. ('NAL'), Australia (ABN 48 003 032 513), regulated by the Australian Securities and Investment Commission ('ASIC') and holder of an Australian financial services licence number 246412; P.T. Nomura Indonesia ('PTNI'), Indonesia; Nomura Securities Malaysia Sdn. Bhd. ('NSM'), Malaysia; NIHK, Taipei Branch ('NITB'), Taiwan; Nomura Financial Advisory and Securities (India) Private Limited ('NFASL'), Mumbai, India (Registered Address: Ceejay House, Level 11, Plot F, Shivsagar Estate, Dr. Annie Besant Road, Worli, Mumbai- 400 018, India; Tel: +91 22 4037 4037, Fax: +91 22 4037 4111; CIN No: U74140MH2007PTC169116, SEBI Registration No. for Stock Broking activities : BSE INB011299030, NSE INB231299034, INF231299034, INE 231299034, MCX: INE261299034; SEBI Registration No. for

    Merchant Banking : INM000011419; SEBI Registration No. for Research: INH000001014 and NIplc, Madrid Branch ('NIplc, Madrid'). 'CNS Thailand' next to an analyst's name on the front page of a research report indicates that the analyst is employed by Capital Nomura Securities Public Company Limited ('CNS') to provide research assistance services to NSL under an agreement between CNS and NSL. 'NSFSPL' next to an employee's name on the front page of a research report indicates that the individual is employed by Nomura Structured Finance Services Private Limited to provide assistance to certain Nomura entities under inter-company agreements. The "BDO-NS" (which stands for "BDO Nomura Securities, Inc.") placed next to an analyst's name on the front page of a research report indicates that the analyst is employed by BDO Unibank Inc. ("BDO Unibank") who has been seconded to BDO-NS, to provide research assistance services to NSL under an agreement between BDO Unibank, NSL and BDO-NS. BDO-NS is a Philippines securities dealer, which is a joint venture between BDO Unibank and the Nomura Group.

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    The Nomura Group, and/or its officers, directors and employees, may, to the extent permitted by applicable law and/or regulation, deal as principal, agent, or otherwise, or have long or short positions in, or buy or sell, the securities, commodities or instruments, or options or other derivative instruments based thereon, of issuers or securities mentioned herein. The Nomura Group companies may also act as market maker or liquidity provider (within the meaning of applicable regulations in the UK) in the financial instruments of the issuer. Where the activity of market maker is carried out in accordance with the definition given to it by specific laws and regulations of the US or other jurisdictions, this will be separately disclosed within the specific issuer disclosures.

    This document may contain information obtained from third parties, including ratings from credit ratings agencies such as Standard & Poor's. Reproduction and distribution of third-party content in any form is prohibited except with the prior written permission of the related third-party. Third-party content providers do not guarantee the accuracy, completeness, timeliness or availability of any information, including ratings, and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such content. Third-party content providers give no express or implied warranties, including, but not limited to, any warranties of merchantability or fitness for a particular purpose or use. Third-party content providers shall not be liable for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including lost income or profits and opportunity costs) in connection with any use of their content, including ratings. Credit ratings are statements of opinions and are not statements of fact or recommendations to purchase hold or sell securities. They do not address the suitability of securities or the suitability of securities for investment purposes, and should not be relied on as investment advice.

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    merchantability or fitness of the Index, and do not account for business activities or services that any index user and/or its affiliates undertakes with the use of the Index.

    Investors should consider this document as only a single factor in making their investment decision and, as such, the report should not be viewed as identifying or suggesting all risks, direct or indirect, that may be associated with any investment decision. Nomura Group produces a number of different types of research product including, among others, fundamental analysis and quantitative analysis; recommendations contained in one type of research product may differ from recommendations contained in other types of research product, whether as a result of differing time horizons, methodologies or otherwise. The Nomura Group publishes research product in a number of different ways including the posting of product on the Nomura Group portals and/or distribution directly to clients. Different groups of clients may receive different products and services from the research department depending on their individual requirements.

    Figures presented herein may refer to past performance or simulations based on past performance which are not reliable indicators of future performance. Where the information contains an indication of future performance, such forecasts may not be a reliable indicator of future performance. Moreover, simulations are based on models and simplifying assumptions which may oversimplify and not reflect the future distribution of returns.

    Certain securities are subject to fluctuations in exchange rates that could have an adverse effect on the value or price of, or income derived from, the investment.

    With respect to Fixed Income Research: Recommendations fall into two categories: tactical, which typically last up to three months; or strategic, which typically last from 6-12 months. However, trade recommendations may be reviewed at any time as circumstances change. 'Stop loss' levels for trades are also provided; which, if hit, closes the trade recommendation automatically. Prices and yields shown in recommendations are taken at the time of submission for publication and are based on either indicative Bloomberg, Reuters or Nomura prices and yields at that time. The prices and yields shown are not necessarily those at which the trade recommendation can be implemented.

    The securities described herein may not have been registered under the US Securities Act of 1933 (the '1933 Act'), and, in such case, may not be offered or sold in the US or to US persons unless they have been registered under the 1933 Act, or except in compliance with an exemption from the registration requirements of the 1933 Act. Unless governing law permits otherwise, any transaction should be executed via a Nomura entity in your home jurisdiction.

    This document has been approved for distribution in the UK and European Economic Area as investment research by NIplc. NIplc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. NIplc is a member of the London Stock Exchange. This document does not constitute a personal recommendation within the meaning of applicable regulations in the UK, or take into account the particular investment objectives, financial situations, or needs of individual investors. This document is intended only for investors who are 'eligible counterparties' or 'professional clients' for the purposes of applicable regulations in the UK, and may not, therefore, be redistributed to persons who are 'retail clients' for such purposes. This document has been approved by NIHK, which is regulated by the Hong Kong Securities and Futures Commission, for distribution in Hong Kong by NIHK. This document has been approved for distribution in Australia by NAL, which is authorized and regulated in Australia by the ASIC. This document has also been approved for distribution in Malaysia by NSM. In Singapore, this document has been distributed by NSL. NSL accepts legal responsibility for the content of this document, where it concerns securities, futures and foreign exchange, issued by their foreign affiliates in respect of recipients who are not accredited, expert or institutional investors as defined by the Securities and Futures Act (Chapter 289). Recipients of this document in Singapore should contact NSL in respect of matters arising from, or in connection with, this document. Unless prohibited by the provisions of Regulation S of the 1933 Act, this material is distributed in the US, by NSI, a US-registered broker-dealer, which accepts responsibility for its contents in accordance with the provisions of Rule 15a-6, under the US Securities Exchange Act of 1934. The entity that prepared this document permits its separately operated affiliates within the Nomura Group to make copies of such documents available to their clients.

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    Notice to Canadian Investors: This research report is not a personal recommendation and does not take into account the investment objectives, financial situation or particular needs of any particular individual or account. It is made available to you in reliance on NI 31-103, section 8.25. For report with reference of TAIWAN public companies or authored by Taiwan based research analyst:

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    Disclaimers required in Japan

    Credit ratings in the text that are marked with an asterisk (*) are issued by a rating agency not registered under Japan's Financial Instruments and Exchange Act ("Unregistered Ratings"). For details on Unregistered Ratings, please contact the Research Product Management Dept. of Nomura Securities Co., Ltd.

    Investors in the financial products offered by Nomura Securities may incur fees and commissions specific to those products (for example, transactions involving Japanese equities are subject to a sales commission of up to 1.404% on a tax-inclusive basis of the transaction amount or a commission of ¥2,808 for transactions of ¥200,000 or less, while transactions involving investment trusts are subject to various fees, such as commissions at the time of purchase and asset management fees (trust fees), specific to each investment trust). In addition, all products

    carry the risk of losses owing to price fluctuations or other factors. Fees and risks vary by product. Please thoroughly read the written materials provided, such as documents delivered before making a contract, listed securities documents, or prospectuses.

    Transactions involving Japanese equities (including Japanese REITs, Japanese ETFs, and Japanese ETNs) are subject to a sales commission of up to 1.404% of the transaction amount (or a commission of ¥2,808 for transactions of ¥200,000 or less). When Japanese equities are purchased via OTC transactions (including offerings), only the purchase price shall be paid, with no sales commission charged. However, Nomura Securities may charge a separate fee for OTC transactions, as agreed with the customer. Japanese equities carry the risk of losses owing to price fluctuations. Japanese REITs carry the risk of losses owing to fluctuations in price and/or earnings of underlying real estate.

    Japanese ETFs carry the risk of losses owing to fluctuations in the underlying indexes or other benchmarks.

    Transactions involving foreign equities are subject to a domestic sales commission of up to 1.026% of the transaction amount (which equals the local transaction amount plus local fees and taxes in the case of a purchase or the local transaction amount minus local fees and taxes in the case of a sale) (for transaction amounts of ¥750,000 and below, maximum domestic sales commission is ¥7,668). Local fees and taxes in foreign financial instruments markets vary by country/territory. When foreign equities are purchased via OTC transactions (including offerings), only the purchase price shall be paid, with no sales commission charged. However, Nomura Securities may charge a separate fee for OTC transactions, as agreed with the customer. Foreign equities carry the risk of losses owing to factors such as price fluctuations and foreign exchange rate fluctuations.

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    ¥200,000 or less), as well as management fees and rights handling fees. In addition, long margin transactions are subject to interest on the purchase amount, while short margin transactions are subject to fees for the lending of the shares borrowed. A margin equal to at least 30% of the transaction amount and at least ¥300,000 is required. With margin transactions, an amount up to roughly 3.3x the margin may be traded. Margin transactions therefore carry the risk of losses in excess of the margin owing to share price fluctuations. For details, please thoroughly read the written materials provided, such as listed securities documents or documents delivered before making a contract.

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    ¥4,320 if this would be less than ¥4,320). When convertible bonds are purchased via OTC transactions (including offerings), only the purchase price shall be paid, with no sales commission charged. However, Nomura Securities may charge a separate fee for OTC transactions, as agreed with the customer. Convertible bonds carry the risk of losses owing to factors such as interest rate fluctuations and price fluctuations in the underlying stock. In addition, convertible bonds denominated in foreign currencies also carry the risk of losses owing to factors such as foreign exchange rate fluctuations.

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    When Japanese government bonds (JGBs) for individual investors are purchased via public offerings, only the purchase price shall be paid, with no sales commission charged. As a rule, JGBs for individual investors may not be sold in the first 12 months after issuance. When JGBs for individual investors are sold before maturity, an amount calculated via the following formula will be subtracted from the par value of the bond plus accrued interest: (1) for 10-year variable rate bonds, an amount equal to the two preceding coupon payments (before tax) x 0.79685 will be used, (2) for 5-year and 3-year fixed rate bonds, an amount equal to the two preceding coupon payments (before tax) x 0.79685 will be used.

    When inflation-indexed JGBs are purchased via public offerings, secondary distributions (uridashi deals), or other OTC transactions with Nomura Securities, only the purchase price shall be paid, with no sales commission charged. Inflation-indexed JGBs carry the risk of losses, as prices fluctuate in line with changes in market interest rates and fluctuations in the nationwide consumer price index.The notional principal of inflation-indexed JGBs changes in line with the rate of change in nationwide CPI inflation from the time of its issuance. The amount of the coupon payment is calculated by multiplying the coupon rate by the notional principal at the time of payment. The maturity value is the amount of the notional principal when the issue becomes due. For JI17 and subsequent issues, the maturity value shall not undercut the face amount. Purchases of investment trusts (and sales of some investment trusts) are subject to a purchase or sales fee of up to 5.4% of the transaction amount. Also, a direct cost that may be incurred when selling investment trusts is a fee of up to 2.0% of the unit price at the time of redemption. Indirect costs that may be incurred during the course of holding investment trusts include, for domestic investment trusts, an asset management fee (trust fee) of up to 5.4% (annualized basis) of the net assets in trust, as well as fees based on investment performance. Other indirect costs may also be incurred. For foreign investment trusts, indirect fees may be incurred during the course of holding such as investment company compensation.

    Investment trusts invest mainly in securities such as Japanese and foreign equities and bonds, whose prices fluctuate. Investment trust unit prices fluctuate owing to price fluctuations in the underlying assets and to foreign exchange rate fluctuations. As such, investment trusts carry the risk of losses. Fees and risks vary by investment trust. Maximum applicable fees are subject to change; please thoroughly read the written materials provided, such as prospectuses or documents delivered before making a contract.

    In interest rate swap transactions and USD/JPY basis swap transactions ("interest rate swap transactions, etc."), only the agreed transaction payments shall be made on the settlement dates. Some interest rate swap transactions, etc. may require pledging of margin collateral. In some of these cases, transaction payments may exceed the amount of collateral. There shall be no advance notification of required collateral value or collateral ratios as they vary depending on the transaction. Interest rate swap transactions, etc. carry the risk of losses owing to fluctuations in market prices in the interest rate, currency and other markets, as well as reference indices. Losses incurred as such may exceed the value of margin collateral, in which case margin calls may be triggered. In the event that both parties agree to enter a replacement (or termination) transaction, the interest rates received (paid) under the new arrangement may differ from those in the original arrangement, even if terms other than the interest rates are identical to those in the original transaction. Risks vary by transaction. Please thoroughly read the written materials provided, such as documents delivered before making a contract and disclosure statements.

    In OTC transactions of credit default swaps (CDS), no sales commission will be charged. When entering into CDS transactions, the protection buyer will be required to pledge or entrust an agreed amount of margin collateral. In some of these cases, the transaction payments may exceed the amount of margin collateral. There shall be no advance notification of required collateral value or collateral ratios as they vary depending on the financial position of the protection buyer. CDS transactions carry the risk of losses owing to changes in the credit position of some or all of the referenced entities, and/or fluctuations of the interest rate market. The amount the protection buyer receives in the event that the CDS is triggered by a credit event may undercut the total amount of premiums that he/she has paid in the course of the transaction. Similarly, the amount the protection seller pays in the event of a credit event may exceed the total amount of premiums that he/she has received in the transaction. All other conditions being equal, the amount of premiums that the protection buyer pays and that received by the protection seller shall differ. In principle, CDS transactions will be limited to financial instruments business operators and qualified institutional investors.

    No account fee will be charged for marketable securities or monies deposited. Transfers of equities to another securities company via the Japan Securities Depository Center are subject to a transfer fee of up to ¥10,800 per issue transferred depending on volume.

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    Additional information regarding the methodologies or models used in the production of any investment recommendations contained within this document is available upon request by contacting the Research Analysts listed on the front page. Disclosures information is available upon request and disclosure information is available at the Nomura Disclosure web page: http://go.nomuranow.com/research/globalresearchportal/pages/disclosures/disclosures.aspx

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