CEI/HanKore

CEI/HanKore: HSBC hosted CEI in Europe, CEI elaborated 3 areas where CEI should benefit from synergy with HanKore: 1) CEI’s WTE facilities will be able to treat the sludge from HanKOre’s sewage plants 2) It helps with future project wins as CEI has turned more of a comprehensive environmental services provider 3) Enhances CEI’s negotiation power in future fee hike negotiations CEI believes it should not suffer from a conglo discount after the re-organization. It believes the conglo discount applies more for companies holding businesses that do not have synergy. On receivables, CEI doesn’t have any problems, and HanKore’s should improve after CEI as local governments generally pay SOEs in a more timely fashion than private companies. HSBC has a O/W call on CEI with TP of HK$12.60