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August 2013

IMPACT INVESTMENTPresented by : Quyen Duong

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INTRODUCTION

Longest established asset manager in Indochina

Active since 1994

Total assets under management grown from $17mn to $1bn at present

Invested in more than 130 companies

Completed 51 private equity exits through different routes

The only fund manager in the region that has made investments in Vietnam,

Cambodia, and Laos

Recognised responsible investor shortlisted in the category Sustainable

Investor of the Year for the FT/IFC Sustainable Finance Awards in two

consecutive years 2011 and 2012

Solid platform of more than 40 experienced investment professionals, 4 in-

house legal counsels and full-scale back office operation

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Background:

Vinamilk is Vietnams largest diary company and currently

the 2nd biggest non-financial on VNI with market cap of$2.4bn

Strong market leader position with largest distribution

network of dairy products in Vietnam

Sales CAGR of 35% and net profit CAGR of 45% from

2007-2011

BOP Impact:

Employment generation and inclusion of poor farmers in

dairy supply chain as a result of raw material initiative

Nutrition and health impact from increased milk

consumption

Active measure in environment and energy conservation

Active CSR program to improve social well-being of the

community

Sector: Food & Beverage

Investment date: Oct 2003Performance: Overall return

is 35.6% IRR and 3x multiple.

Partial exit tranche yielded

39% IRR and 5x multiple

VINAMILK

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CASE STUDIES

Background:

Cambodias largest microfinance institution, with 154

offices in 24 provinces, focused on rural communitiesand micro-enterprises

From 2004-2010, loan portfolio increased 12.5 times.

Yet portfolio at risk above 90 days stays at less than 1%

Net profit CAGR of more than 20% during 2007-2010,

with net earnings of US$3.4m in 2010

BOP Impact:

Cambodias largest microfinance institution, with 154

offices in 24 provinces, focused on rural communities

and micro-enterprises

From 2004-2010, loan portfolio increased 12.5 times.

Yet portfolio at risk above 90 days stays at less than 1%

Net profit CAGR of more than 20% during 2007-2010,

with net earnings of US$3.4m in 2010

Sector: Financial Services

Investment date: Dec 2006Performance: 5x multiple

PRASAC

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IMPACT INVESTMENT MARKET

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Population Share Populat ion Purchasing Power Accumulated Purchasing Power % million US$ million US$ million

at $2 a day Vietnam* 43.4 36.9 31,654 39,340

Lao PDR* 65.9 4.0 48,125 63,581

Cambodia* 53.2 7.4 38,870 49,234

Thailand 4.6 3.2 3,368 3,535

Total 51.4 122,017 245,007

at $4 a day Vietnam* 83.1 70.8 121,349 213,763

Lao PDR* 92.5 5.6 135,041 269,841

Cambodia* 87.4 12.1 127,594 238,287

Thailand 36.0 24.6 52,632 66,433

Total 113.0 436,616 1,264,848

Poverty Line Country

Source: Worldbank databank, as end of 2009, except * as end of 2008.

The market at the base of pyramid is untapped and offers profound investment

opportunities for investors

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Agriculture

Healthcare

Pharmaceuticals

Financial Services

Education

Energy

Water

Employment generation

Income growth

Productivity improvement

Access to products and

services

Health improvement

Supply chain improvement

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BUSINESS SECTORS AND IMPACT OBJECTIVES

Deal sourcing:

Select business sectors with opportunities for BOP impact then selectappropriate companies within such sectors

Select an impact objective then build appropriate projects together with

target companies

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CHALLENGES

Sustainability

Scalability

High cost

Financial returns vs. social returns

Impact measurement

PROPOSED SOLUTIONS

Work with established companies

Localise investment team

Proper due diligence by experienced

professionals

Intensive post-investment monitoring

Grant-sponsored technical assistance

facility

Manage investors expectation

Impact Reporting and Investment

Standards

Unconventional partnership of multiple

stakeholders: fund managers, DFIs,

NGOs, government agencies

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CHALLENGES AND PROPOSED SOLUTIONS

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THANK YOU

Dragon Capital 2013. All rights reserved. The information contained in this presentation is strictly confidential and is

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