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Deutsche Bank Markets Research

Europe Germany

Periodical

Made in Germany Special Report

Date 9 April 2013

German SMEs: Investing in the sweet-spot of corporate Germany

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Deutsche Bank AG/London

Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1. MICA(P) 072/04/2012.

Lars Slomka, DVFA

Strategist (+49) 69 910-31942 [email protected]

Jan Rabe

Strategist (+49) 69 [email protected]

Benjamin Kohnke Uwe Schupp, CFA

Research Analyst Research Analyst (+49) 69 910-31943 (+49) 69 910-31955 [email protected] [email protected]

Value added growth among EU SMEs (2008-11)

Source: European Commission, Deutsche Bank

German SME key picks

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Company name Rec. (EUR bn) (EUR) (EUR) (%)

Compugroup Buy 853 17.0 23.0 35Duerr Buy 1,366 78.9 95.0 20LEG Buy 2,148 40.6 48.5 20Morphosys Buy 714 31.0 43.0 39Schaltbau Holding Buy 194 31.5 38.0 21Tom Tailor Buy 379 17.2 19.0 10United Internet Buy 3,753 19.4 22.0 14

Price & DB Recommendation

Source: Datastream, Deutsche Bank Estimates

The purpose of this report is to help investors navigate the German small and medium-sized enterprise (SME) equity universe under Deutsche Bank coverage, with a market capitalisation up to E5bn. The investment case for German SMEs is highly attractive, in our view, and we recommend Compugroup, Duerr, LEG, MorphoSys, Schaltbau AG, Tom Tailor and United Internet as our key picks. We also screen German SMEs for investable themes and further highlight CTS Eventim, Draegerwerk AG, GEA and Wincor Nixdorf. Investment case: trends appear and vanish, but values persist (1) The structural case: Ten years ago, Germany was considered the “sick man of Europe”. Its economy was mired in recession, while the rest of Europe was recovering; its unemployment rate was higher than the Euro area average and was violating the European budget rules by running excessive deficits. A decade later, Germany is considered a role model for everyone else. One of the key strengths of the German economy is the significant economic value added by small and mid-cap enterprises (SMEs). The majority are family-owned, are often characterised by their concentration on profitable niche market segments or premium segments of mass markets, their technology-based product leadership as well as their close customer relationships. This profile helps them avoid head-to-head competition with global giants. (2) The fundamental case: Our analysis reveals that overall, German SMEs have a sounder financial base than their European peers, with less leverage, higher net interest cover and lower dependence on external financing. In addition, German SMEs generate higher returns on capital, despite a significantly lower level of investments in fixed assets, pointing towards higher capital efficiency. This combination of elements has enabled German SMEs to recover much more strongly from the 2008/09 economic downturn than most European SME peers (see top-right chart). A stronger top-line and more robust operating margins among German SMEs relative to European (ex Germany) peers translated into a superior EPS growth profile over the past decade, and we expect this trend to continue, in line with our analysts’ bottom-up estimates. German SMEs in aggregate trade at a 2014E P/E of 13.8x vs. European (ex Germany) peers at 12.2x – a discount to the 10-year structural premium (see pages 06-17). Investable screens: German SMEs reflected in a broad range of vantage points We focus on key investment themes, looking at German SMEs with a focus on family businesses, exporters, momentum plays and regional exposure. We have also prepared screens that could be of special interest to conservative, style and income investors (see pages 41-49). Due to the heterogeneous composition of individual business models within these themes, we recommend approaching them via selective stock-picking and highlight Buy-rated stocks with an intact business case and significant upside implied by our analysts target prices. In this regard, our top-down picks CTS Eventim, Draegerwerk AG, GEA and Wincor Nixdorf appear frequently and should be considered by investors interested in German SMEs (see Figure 1 on page 05 in the executive summary). Our key picks among German SMEs: “The Magnificent Seven” We provide an overview of the most important sectors among German listed SMEs, i.e. Automobiles & Parts, Consumer & Retail, Mechanical Engineering, Pharma & HC/Biotech, Real Estate and TMT (Technology, Media and Telcos) (see pages 34-40). Our key bottom-up picks, which we believe are well positioned to outperform the broader market, are: Compugroup, Duerr, LEG, MorphoSys, Schaltbau AG, Tom Tailor and United Internet (see bottom right table and pages 19-33 for details). The basket offers 20% upside potential from current price levels and trades at a discount to the German SME universe based on average (median) 2014E P/E of 10.8x (10.1x).

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Table Of Contents

Executive summary .......................................................................... 3 Key findings ............................................................................................................................ 3

1 Introduction: trends appear and vanish, but values persist ...... 6 1.1 German SMEs: investing in the corporate sweet-spot ..................................................... 6 1.2 German SMEs’ innovation-driven competitiveness stands out in European comparison . 8 1.3 Technology and knowledge-intensity enable German SMEs to over-proportionally grow value-added ahead of European peers .................................................................................. 12 1.4 Financial structure and refinancing of German SMEs in European comparison: disarming a critical argument ................................................................................................................ 14 1.5 P&L review: superior EPS strength comes at a premium ............................................... 17

2 How to approach it ..................................................................... 19 2.1 German SME top picks: Our preferred Buy ideas ........................................................... 19 2.2 German SME sector focus: identifying the most relevant spots .................................... 34 2.3 Investable themes (top-down screenings) ...................................................................... 41

Appendix A ..................................................................................... 50 Market data chart book ......................................................................................................... 50 A.1 Key economic indicators ................................................................................................ 51 A.2 Performance ................................................................................................................... 52 A.3 Earnings .......................................................................................................................... 53 A.4 Consensus recommendation momentum ...................................................................... 54 A.5 Directors’ Dealings ......................................................................................................... 55 A.6 Traditional valuation ........................................................................................................ 56 A.7 Index agglomerations ..................................................................................................... 58

Appendix B ..................................................................................... 60 Q1 2013 reporting calendar .................................................................................................. 60

Appendix C ..................................................................................... 65 Companies mentioned list .................................................................................................... 65

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Executive summary

Key findings

The purpose of this report is to help investors navigate the German small and medium-sized enterprise (SME) equity universe under Deutsche Bank coverage, with a market capitalisation up to E5bn. Key elements of the report include a detailed investment case, stock ideas as well as investable themes and screenings.

1) German SMEs at the vanguard of innovation-driven businesses in Europe: Backed by a high share of the technology-intensive labour force, German SMEs tend to be the most innovative in Europe and enable the German economy to stand out in an international comparison. Characteristics attributable to listed German SMEs can be derived from “Mittelstand” companies, which are known for their concentration on profitable niche market segments and/or the premium segments of mass markets, their technology-based product leadership and their close customer relationships. Their long-term strategic business orientation supports the identification of these niches, thereby enabling the overall export-led economy to defend a strong global position, comprising the majority of world market leaders across industries (see pages 8-11 for details).

2) German SMEs are based on a sounder financial basis relative to European peers: One of the more negative facets of SMEs in general has been their financing structure. SMEs are more reliant on bank loans, compared to large caps which have access to corporate bond markets. The stronger dependency on bank loans can be a serious concern in times of financial distress. However, we find that German SMEs are generally well funded and access to funding is not an issue. In aggregate, German SMEs have a sounder financial base compared to European peers with lower leverage, a higher net interest cover and lower dependency on external financing, as they have managed to increase their equity ratio in excess of European peers. Moreover, German SMEs overall generate higher returns on capital, despite a significantly lower level of investment in fixed assets, pointing towards higher capital efficiency (see pages 14-16 for details).

3) Stronger operational gearing boosts EPS over-proportionally: Finally, we observe that German SMEs are characterised by a significantly stronger top line and more robust operating margins which has translated into a superior EPS growth profile over the past decade (2003-2012). In line with our analysts’ bottom-up forecasts, we expect this trend to continue going forward (see page 17 for details).

How to approach it (1): German SME top picks – our preferred Buy ideas We have identified Compugroup, Duerr, LEG, MorphoSys, Schaltbau AG, Tom Tailor and United Internet as our key picks among German SMEs; we believe these companies are well positioned to outperform the broader market going forward (see pages 19-33 for details).

How to approach it (2): German SME sector focus – identifying the most relevant spots Most of the listed German SME companies are concentrated in six sectors, i.e. Automobiles & Parts, Consumer/Retail, Mechanical engineering, Pharma & HC/Biotech, Real Estate and TMT (Technology, Media and Telcos). We highlight the most important common drivers in each sector and analyse investor positioning to help readers identify the most interesting themes and Buy ideas from a top-down perspective (see pages 34-40 for details).

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How to approach it (3): screening for investable themes (top-down perspective) We focus on key investable themes relevant to the international investor base, looking at German SMEs with a focus on family businesses, exporters, momentum plays and regional exposure. We have also prepared screens that could be of special interest to conservative, style and income investors:

Family businesses: One of the most prominent themes among the German SME equity universe in the past has been the selection of “family businesses”. We recommend being selective and highlight CompuGroup, CTS Eventim, Draegerwerk, Duerr, Gerry Weber, Jungheinrich, QSC, SMA, Software AG, Tom Tailor, United Internet as our key picks in this basket (see page 42 for details).

Exporters: Next to the investment theme of “family businesses”, the screen of “exporters” among corporate Germany is one of the most frequently-requested ones. Fundamentally, we believe it is the one with the greatest upside from the current level and highlight Aixtron, Draegerwerk, GEA and MTU as key picks among German SME exporters (see page 43 for details).

Momentum plays: We screened the German SME universe for “Fallen Angels” (i.e. out-of-favour stocks poised for a rebound or buying opportunities) and “Falling Angels” (i.e. out-of-favour consensus Buys or selling opportunities). Based on this screening, we recommend owning Air Berlin, Heidelberger Druck and highlight Fielmann, Delticom as Sells (see pages 44-45 for details).

Regional exposure: We sorted the German SME equity universe for the Top 20 companies with revenue exposure to their home country (Germany), rest of Europe (Europe ex Germany), the Americas and to Asia/Pacific (see pages 45-46 for details).

Designed for conservative investors: Conservative investors could be interested in owning stocks that 1) offer a high return on equity, 2) are subject to low volatility and 3) can be bought at a reasonable price. In this regard, we highlight Duerr, Wincor Nixdorf, Gerry Weber, CompouGroup, CTS Eventim, United Internet and Hugo Boss as key names (see page 47 for details).

Designed for style investors: We screened the German SME universe for “Value” and “Growth” stocks and conclude that we prefer “Growth” over “Value” in the mid-term (>12 months forward) based on the market cap weighted upside implied by our analysts’ target prices. Buy-rated “Growth” stocks with significant upside potential to our analysts’ target prices include comdirect, MTU, ProSiebenSat.1, PSI AG and Software AG (see pages 47-49 for details).

Designed for income investors: We screened the German SME equity universe for two dividend themes, i.e. “sustainable dividends” and “current dividend yield attractiveness”. Within the “sustainable dividend” screen, Hugo Boss is the only Buy-rated stock with significant upside implied by our analyst’s target price. Among the “current dividend yield attractiveness” screen we highlight CEWE Color, CTS Eventim, Duerr, GEA, QSC and Wincor Nixdorf as key picks (see page 49 for details).

Appearance of key picks and other Buy-rated stocks across screens Figure 1 highlights all Buy-rated stocks within our German SME equity universe under Deutsche Bank coverage which appear in screenings highlighted in this report. Aside from our key bottom-up picks mentioned above, we note that CTS Eventim, Draegerwerk AG, GEA and Wincor Nixdorf appear numerous times from a top-down perspective and could be of interest to investors looking at German SMEs.

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Figure 1: Appearance of our key picks and other Buy-rated stocks across investable themes and screens within this report

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Thematic (1): Family basket (page 42) x x x x x x x x x x x

Thematic (2): Exporter basket (page 43) x x x

Momentum plays (1): "Fallen Angels" (pages 44-45) x x x

Momentum plays (2): "Falling Angels" (pages 44-45) x

Sales exposure (1): Domestic Germany (>75%) (pages 45-46) x x x x x x x x x x

Sales exposure (2): Europe ex GER (>35%) (pages 45-46) x x x x x x

Sales exposure (3): Asia/Pacific (>25%) (pages 45-46) x x x x x

Sales exposure (4): Americas (>25%) (pages 45-46) x x x x x x

Conservative screen (page 47) x x x x x x x

Style (1): Value screen (pages 47-48) x

Style (2): Growth screen (pages 47-48) x x x x x

Dividends (1): Sustainable DPS screen (page 49) x x

Dividends (2): Current yield attractivness (page 49) x x x x x x

Descriptive screens

Performance (1): Strongest relative perf. 2013 YTD (page 52) x x x x x x x

Performance (2): Weakest relative perf. 2013 YTD (page 52) x

EPS revisions (1): Strongest 1M EPS upgrades (page 53) x x x

EPS revisions (2): Strongest 3M EPS upgrades (page 53) x x x x

EPS revisions (3): Strongest 1M EPS downgrades (page 53) x x

EPS revisions (4): Strongest 3M EPS downgrades (page 53) x

Cons. rec. (1): Highest (IBES) cons. rec. score (page 54) x x x x x x x x x x

Cons. rec. (2): Lowest (IBES) cons. rec. score (page 54) x x x

Cons. rec. (3): Highest m-o-m (+) chg. in the score (page 54) x x x x x x x

Cons. rec. (4): Highest m-o-m (-) chg. in the score (page 54) x x x x x x

Directors' Dealings (1): Buy transactions (page 55) x x

Directors' Dealings (2): Sell transactions (page 55) x x x x x x

Valuation (1): Lowest P/E ratio (2013E) (page 56) x x x x x x x x

Valuation (2): Highest P/B ratio (2013E) (page 56) x x x x

Valuation (3): Lowest P/B ratio (2013E) (page 56) x x x x

Valuation (4): Lowest EV/EBITDA ratio (2013E) (page 56) x x x x x

Valuation (5): Highest EV/EBITDA ratio (2013E) (page 56) x x x x x

Key picks among German SMEs Other noteworthy Buy-rated German SMEs mentioned in this report with significant upside to our TP

Source: Deutsche Bank

9 April 2013



1 Introduction: trends appear and vanish, but values persist In this section, we provide investors with an introduction to the characteristics of investing in the German small and mid cap enterprise (SME) universe under Deutsche Bank coverage.

1.1 German SMEs: investing in the corporate sweet-spot

One of the key strengths of the German economy is the significant economic value added by small and mid-cap companies, of which the majority are family-owned and often characterised by their concentration on profitable niche market segments and/or the premium segments of mass markets, their technology-based product leadership and their close customer relationships. This strategy helps them avoid head-to-head competition with global giants. “Don't dance where the elephants play” is a favourite ‘Mittelstand’ slogan. Although the term ‘Mittelstand’ is sometimes applied to quite small, parochial firms, the most interesting ones are somewhat bigger and more outward-focused. Listed German MDax, SDax and TecDax companies below a certain market capitalisation threshold are also often recognised as ‘Mittelstand’ companies for sharing the same values as non-listed ‘Mittelstand’ companies with sales below E1bn and fewer than 500 employees.

Typically, ’Mittelstand’ values include a strong corporate culture with close cooperation between employers and employees, attention to detail, discrete customer relations and financial caution, amongst others. The corporate governance structure of family-owned businesses usually contrasts with that of multinational large cap companies run by external managers with only limited affinity to the ideals and traditions of the business. These structures are often much more capable of preventing principal-agent issues from arising. The majority of these companies also tend to approach business opportunities with a long-term perspective, to generate sustainable returns on invested capital and equity. This long-term orientation certainly helped them overcome the 2009 recession, as well as the recent period of slowing economic growth within Europe. Long-term orientation may also be supportive of the identification of niches and the gaining of a strong global position, which is reflected in Germany’s No.1 rank among the number of industries in which it occupies a No.1, 2 or No. 3 position (see Figure 2).

Figure 2: Germany ranks No.1 as world market leader

across industry sectors globally (2007)

Figure 3: German world market leaders aggregated by

industry sectors (2010)*

Rank Country No.1 No.2 No.3

1 Germany 67 40 35 142 61%

2 China 72 19 16 107 46%

3 USA 34 37 26 97 42%

4 Italy 5 27 26 58 25%

5 Japan 10 21 19 50 22%

6 France 5 9 17 31 13%

7 UK 3 8 8 19 8%

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1 Mechanical engineering and plant manufacturing 30%2 Consumption & commodity goods 13%3 Industrial goods & services 13%4 Electrical engineering 8%5 Car suppliers 8%6 Pharma & medical engineering 6%7 Construction 5%8 Chemicals 4%9 Commodities 3%10 Food & Beverages 3%11 High-technologies 3%12 Trade & commerce 2%13 Miscellaneous 1%14 Media 1%15 Software 1%

Source: International Cluster Competitiveness Project (ICCP), Institute for Strategy and Competitiveness, Harvard Business School

* Database German Global Market Leaders, calculations made by Prof. Dr. Bernd Venohr Source: Manager Magazin (October 2010)

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World market leaders identified across German small and mid-cap companies with annual revenues of up to EUR1bn account for c40% of all German exports. Around 90% of the identified German world market leaders relate to production sectors and 70% are represented by family businesses. The majority of these companies relate to the Mechanical engineering sector followed by Consumption & Commodity goods and Industrial Goods & Services (see Figure 3). Interestingly, it can be shown that world market leadership positions among German small and mid-cap companies are indeed sustainable over the long-run (see Figure 4).

Figure 4: Sustainability of world market leadership among

German small-/ and mid-cap companies

Figure 5: German exports of goods and services (as % of

GDP) in international comparison

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Moreover, it is well known that the German economy has benefitted from global integration via rising exports over recent decades. In the recent decades of economic liberalisation, German companies have been able to turn their domination of German market niches into strong international market leadership. The US has four times as many Fortune Global 500 companies as Germany; Japan twice as many, and even France has more. Yet the export strength of these countries is far below Germany’s. Measuring exports relative to domestic value added reveals that Germany by far outpaces its major peers in the developed market world (see Figure 5).

At the root of Germany’s continuing export success are small and mid-sized companies. For example, the average export ratio (share of revenues generated abroad) of the largest family-owned businesses in Germany reached 39% during 2008-2011 and therefore exceeds that achieved by all German companies in 2010 (18%). The higher export ratio of family-owned businesses in Germany indicates a strong international standing, based on competitive and well positioned products/services. Many of these companies have benefitted from global integration well beyond exports, i.e. by “exporting” their successful business models, implementing industry standards and setting up production sites abroad to benefit from 1) the proximity of markets in need of specialist, best-in-class products, and also from 2) cheap labour in Eastern Europe and Asia. The concept of successfully “exporting the business model” is supported by many factors including strong brands, high market barriers to entry and the ability to “localise” a global product.

In many cases, the growth profiles of German small and mid-cap companies are predominantly driven by organic rather than external growth (via acquisitions), led by an innovative and entrepreneurial character with the intention to be a benchmark for competitors and industries globally instead of following trends.

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1.2 German SMEs’ innovation-driven competitiveness stands out in European comparison

The quality of the platform a country offers for its corporate environment is predominantly relevant for companies with a strong global orientation, such as for the export-oriented German economy, which is constituent to the third of three economic development stages, i.e. the “innovation-driven” stage (first stage: factor-driven; second stage: efficiency-driven). At this stage, companies must compete by producing new and different goods through new technologies and/or the most sophisticated production processes or business models.

As SMEs in Germany represent c.99% of all companies and account for c.40% of total employment as well as for c.1/3 of the German economy’s total valued added (2011), we can argue that SMEs account for a large share of the German economy’s competitiveness, and thereby underscore the commonly-known saying that “SMEs represent the backbone of the German economy”.

In this regard, we find it useful to review the World Economic Forum’s ‘Global Competitiveness Report’ which analyses competitiveness among 144 countries globally based on three major categories (i.e. basic requirements, efficiency enhancers and innovation), 12 sub-pillars and 123 variables. Based on the findings in the latest 2012/2013 report, Germany ranked 6th in the composite score, which comprises results from the three major categories. Figure 6 and Figure 7 below present the composite rank for the German economy in a global comparison (the lower, the more competitive a country is relative to peers), while Figure 9 to Figure 11 highlight details within the three major categories in more detail.

The report concludes, “Germany is ranked an excellent 3rd for the quality of its infrastructure, boasting in particular first-rate facilities across all modes of transport. The goods market is quite efficient, characterised by intense local competition (8th rank) and low market dominance by large companies (2nd). Germany’s business sector is very sophisticated, especially when it comes to production processes and distribution channels, and German companies are among the most innovative in the world, spending heavily on R&D (4th) and displaying a high capacity for innovation (3rd) – traits that are complemented by the country’s well-developed ability to absorb the latest technologies at the firm level (16th). These attributes allow Germany to benefit greatly from its significant market size (5th), which is based on both its large domestic market and its strong exports. […]. In view of continued economic difficulties in the euro area, Germany’s performance in the macroeconomic pillar remains remarkably stable.”

This strong economic set-up, in combination with 1) a Euro currency which is too weak for the economy’s export strength/global position relative to other Euro member states, 2) a comfortable refinancing environment (see section 1.4 below), and 3) a sustainable world market leadership in the majority of global sector segments (as outlined above), underscores our structurally positive view on the German economy as a whole as well as its SME base – a significant driver of the economy’s overall strong global competitive position. According to the European Commission’s regular fact-findings across member countries, Germany hosts the best-performing SME sector in the EU in terms of the numbers of jobs provided and the value-added created over past years.1

1 See European Commission (2012): “SBA Fact Sheet 2012 – Germany”.

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Figure 6: Global competitiveness ranks over time Figure 7: Global competitiveness ranks (2012/13 report)

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Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank Source: World Economic Forum (Global Competitiveness Report 2012-13), Deutsche Bank

Figure 8: European competitiveness ranks over time Figure 9: Germany, category 1 (basic requirements)

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According to the European Commission’s ‘Innovation Union Scoreboard 2013’, Germany is the most innovative country among EU member countries after Sweden and is classified as an innovation-leader within Europe (i.e. 20% or more above that of the EU27 average)2 . The most interesting finding within Europe, in our view, is the clear “north-south-divide” where the Nordics (ex Norway) and core European countries rank on top, above the EU27 average, while Greece, Portugal, Spain and Italy rank below the EU27 average (Figure 12). This observation not only reflects the current status quo but also the past years, and we observe not too much has changed over time (Figure 13).

Figure 12: EU Member States’ innovation index 2012* Figure 13: Relative country delta (in %) vs. EU27 average

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Source: European Commission (‘Innovation Union Scoreboard 2013’) Source: European Commission (‘Innovation Union Scoreboard 2010-2013’)

The report also finds that Germany’s innovative position is increasingly driven by SMEs (see Figure 14) and stands out in European comparison (see Figure 15).

Figure 14: Innovation index vs. SME innovators index* Figure 15: SME innovators index* landscape

* Consists of indicators for SMEs introducing product/process/marketing/organisational innovations. Source: European Commission (http://ec.europa.eu/enterprise/archives/ius2013/IUS2013.html)

* Consists of indicators for SMEs introducing product/process/marketing/organisational innovations. Source: European Commission (http://ec.europa.eu/enterprise/archives/ius2013/IUS2013.html)

2 The Innovation Union Scoreboard 2013 gives a comparative assessment of the innovation performance of the EU27 Member States and the relative strengths and weaknesses of their research and innovation systems. It monitors innovation trends across the EU27 Member States, as well as. The measurement framework used in the Innovation Union Scoreboard distinguishes between 3 main types of indicators and 8 innovation dimensions (i.e. human resources, research systems, finance and support, firm investments, linkages and entrepreneurship, intellectual assets, innovators, economic effects), capturing 24 different indicators (performance is measured using a composite indicator building on data for 24 indicators going from a lowest possible performance of 0 to a maximum possible performance of 1). The overall ambition of the Innovation Union Scoreboard is to inform policy discussions at national and EU level, by tracking progress in innovation performance within and outside the EU over time.

9 April 2013



Findings from the European Commission’s report indicate that the foundation for an innovation-driven German economy can be found in the nexus between highly innovative downstream businesses with a close tie to upstream companies – a critical element to technological progress and high innovation rates in many German industrial sectors. For example, the close cooperation between the German automotive supplier industry (mainly SMEs) and the large original equipment manufacturers (OEMs) is one reason for the technological leadership of the sector globally. The automotive suppliers thus support the high competitiveness of German OEMs in all the important car markets. Also, a high degree of flexibility allows German SME to adapt rapidly to new technological developments and diverging economic developments.

During the 2008/09 economic downturn, investors feared German SMEs would be cut off from financing and would therefore have to scale back R&D spending at the expense of future earnings growth (direct), and this would have negative spill-over effects on relative competitiveness among upstream businesses relying on SMEs’ innovative strengths (indirect).

This, however, was countered by the German government’s initiative to promote a concentrated innovation programme especially focused on German “Mittelstand” companies. Government-backed R&D programmes for SME companies predominantly focused on the IT and Mechanical Engineering sectors between 1999-2008 (see Figure 16) as well as between 2004-2010 (see Figure 17).

Figure 16: R&D support through PRO INNO (1999-2008) Figure 17: R&D support through PRO INNO II (2004-2010)

3.7%

5.5%

7.2%

10.2%

12.4%

18.0%

0% 5% 10% 15% 20%

Other goods

Metal products

Architecture

Personal services

Mechanical engineering

IT

Share of completed projects*

3.3%

3.6%

6.1%

7.7%

14.2%

18.6%

0% 5% 10% 15% 20%

Rubber & Plastics

Services (IT)

Metal products

Architecture

Mechanical engineering

IT

Share of completed projects*

* PRO INNO: Data relates to projects completed during 1999-2008 (6,289 projects in total). Source: ZMI, Deutsche Bank * PRO INNO: Data relates to projects completed during 2004-2010 (7,552 projects in total).

Source: ZMI, Deutsche Bank

The intent was 1) to sustainably strengthen SMEs’ R&D efficiency, 2) to support the transition of innovative products from creation to market introduction, 3) to enhance the products’ technical as well as economical potential, and 4) to secure/establish qualified jobs. With the support of these programmes, participating German SME companies managed to 1) strengthen revenue streams, 2) secure highly qualified jobs, 3) significantly shorten R&D cycles and 4) improve competitive advantages via advanced technological knowhow related to core businesses, leading to a more efficient use of input factors.

In turn, the success of such programmes is also well reflected in the general perception of the German economy as an innovation-driven platform capable of providing a solid basis for domestic companies to successfully lever their business models globally and to sustain leadership in (specialised) niche markets, as outlined above.

9 April 2013



1.3 Technology and knowledge intensity enable German SMEs to over-proportionally grow value-added ahead of European peers

As competitiveness often refers to the set of institutions, policies and factors that determine the level of productivity of a country, we find that a relatively high share of technology and knowledge-intensive employment helps explain the diverse recovery development of value-added among EU member states since the 2008/09 downturn. In terms of sectoral distribution, Germany’s SME sector closely resembles the EU average, with one important exception: the relative importance of hi-tech manufacturing SMEs in Germany clearly stands out from the EU average. More than 34,000 SMEs (18%) are engaged in high-tech or medium- to high-tech activities, as opposed to only 12% in the EU. The difference is also reflected in its share of total SME employment and value-added creation, where Germany is ahead of the EU average, with 27% (EU: 21%) and 36% (EU: 30%), respectively. Most of the difference is accounted for by the medium- to high-tech segment. Interestingly, on the services side there is no difference between Germany and the rest of the EU. The proportion of SMEs providing knowledge-intensive services of the total number of SMEs is largely comparable between Germany and the EU as a whole. About 27% of German SMEs are engaged in knowledge-intensive sectors, accounting for 24% of total SME employment and 29% of gross value-added. Of these, only a very small number — 4% of all SMEs — are involved in high-tech activities, employing 4% of the German SME workforce and contributing 7% to total gross value-added of German SMEs.

Figure 18: Growth in gross value added (GVA) of SMEs

(sorted by manufacturing technology intensity)

Figure 19: Growth in gross value added (GVA) of SMEs

(sorted by knowledge intensity)

y = 0.0252x - 0.1805

(40%)

(30%)

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% share of HMHTM SME employment in total SME employment, 2011

Germany

France

ItalySpainUK

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Greece

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% share of KIS SME employment in total SME employment, 2011

Germany

UK

Italy

France

SpainGreece

Portugal

Source: European Commission, Deutsche Bank presentation Source: European Commission, Deutsche Bank presentation

Figure 18 and Figure 19 present this positive relationship between gross value-added growth in the manufacturing sector and 1) technology intensity on the one hand and 2) knowledge intensity on the other hand based on the European Commission’s ‘Annual report on small and medium-sized enterprises in the EU’. In Figure 18 EU member states are ranked by technology intensity in 2011 on the x-axis and plotted against their growth of real value added of SMEs from 2008 until 2011 on the y-axis. Technology intensity is indicated by the share of high-tech and medium-high-tech manufacturing (HMHTM) employment in total SME employment.3

3 High-tech and medium-high-tech manufacturing (HMHTM) sectors include basic pharmaceutical products and pharmaceutical preparations, computer, electronic and optical products, chemicals and chemical products, electrical

9 April 2013



In Figure 19 we present the same, based on EU member states ranked by the share of knowledge-intensive service (KIS) SMEs in total SME employment on the x-axis.4

The European Commission’s report shows the average growth rate of gross value added by SMEs in EU member states that have above-average HMHTM shares during 2008-2011 is higher than the EU average and that of the group of Member States with below average HMHTM SME shares. SME employment in countries with above-average HMHTM shares during 2008-2011 declined by less than the EU average. This contrasts with the group of countries with below-average HMHTM SME shares, which experienced more unemployment than the EU27 in aggregate. In a nutshell, countries with higher shares of SME employment in high-tech and medium-high-tech manufacturing sectors tend to show a better performance in terms of real value-added growth than others. The same holds true for KIS shares (albeit Germany ranks closer to the EU average relative to the HMHTM SME shares).

Figure 20: Value added growth among SMEs from 2008-11 across EU members (in %)

-35-30-25-20-15-10

-505

1015

Latv

ia

Lith

uani

a

Pola

nd

Spai

n

Irela

nd

Italy

Slov

enia

Slov

akia

Hun

gary

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ece

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nia

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ch R

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and

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herla

nds

Mal

ta

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en

Ger

man

y

Bel

gium

Employment growth + Value-added per person (productivity) growth = Growth in Value-added

Source: European Commission, Deutsche Bank presentation

It can be further shown that value-added growth of a country can be decomposed by employment growth and productivity growth (see Figure 20).5

Applying this methodology to the 27 EU member states reveals that German SMEs developed strongly on the back of employment growth from 2008-2011 and weathered the crisis much better than most of their peers elsewhere in the EU.

The strong economic recovery also substantially improved the funding environment among German SMEs. There was a significant improvement in the share of SMEs that reported a deterioration in the willingness of banks to provide loans (down from 27% to 16% with the EU average only down from 30% to 27% in 2011 yoy). The share of rejected loan applications/unacceptable loan offers also dropped – from 26% to only 8% (much more than the EU average which declined from 22% to 15% in 2011 yoy).

equipment, manufacture of machinery and equipment, manufacture of motor vehicles, trailers and semi-trailers and manufacture of other transport equipment. 4 Knowledge-intensive services include programming and broadcasting activities, telecommunications, computer programming, consultancy and related activities, information service activities, financial and insurance activities, legal and accounting activities, management consultancy activities, architectural and engineering activities among others. 5 See Uppenberg, K. (2011): „Economic growth in the US and the EU: A sectoral decomposition“, EIB Papers 02/2011, European Investment Bank, Luxembourg.

9 April 2013



1.4 Financial structure and refinancing of German SMEs in European comparison: disarming a critical argument

One of the more negative facets of SMEs in general has been their financing structure. SMEs are more reliant on bank loans compared to large caps, which have more favourable access to corporate bond markets – as is the case among German-listed companies (compare Figure 21 to Figure 26). The stronger dependency on bank loans can be a serious concern in times of financial distress.

Figure 21: Financing sources (EUR bn) of the Dax30^ Figure 22: Financing mix of the Dax30*

1,014

352237

83 320

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800

1,000

1,200

Total Liabilities

Interest Bearing Debt

Bonds Bank Loans Commercial Paper

67%

24%

9%

Bonds

Bank Loans

Commercial Paper

^The figure is based on FY 2011 data. Source: Capital IQ, Deutsche Bank calculations *The figure is based on FY 2011 data and represents the share of interest bearing debt.

Source: Capital IQ, Deutsche Bank calculations

Figure 23: Financing sources (EUR bn) of the MDax50^ Figure 24: Financing mix of the MDax50*

225

4321 23

00

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100

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Total Liabilities



48%52%

0%

Bonds

Bank Loans

Commercial Paper

^The figure is based on FY 2011 data. Source: Capital IQ, Deutsche Bank calculations *The figure is based on FY 2011 data and represents the share of interest bearing debt.

Source: Capital IQ, Deutsche Bank calculations

Figure 25: Financing sources (EUR bn) of the SDax50^ Figure 26: Financing mix of the SDax50*

24

9

2

7

00

5

10

15

20

25

30

Total Liabilities



24%

76%

0%

Bonds

Bank Loans

Commercial Paper

^The figure is based on FY 2011 data. Source: Capital IQ, Deutsche Bank calculations

*The figure is based on FY 2011 data and represents the share of interest bearing debt. Source: Capital IQ, Deutsche Bank calculations

9 April 2013



The lack of funding to SMEs in the Euro area is clearly at the heart of the ECB’s thinking at the current juncture, as it is a clear and persistent sign that policy transmission remains significantly impaired. While the ECB’s ‘Bank Lending Survey’ (Q1’13) provides only little evidence of “discrimination” against SME lending vs. large cap lending, we find clear evidence in the ‘Access to Finance Survey’, as well as in the growing spread between the interest rate charged to very small businesses and non-financial corporations, that SMEs are specifically limited in their access to external funding in Italy and Spain, while no such pattern can be observed in France and Germany. Given a pick-up in demand for credit among German SMEs (see Figure 27), the ECB’s ’Bank Lending Survey (BLS)’ on Germany reveals credit supply constraints are not an issue at the moment, as indicated by the stable net percentage of banks surveyed reporting no tightening of credit standards on a quarter-on-quarter basis in Q1 2013 (see Figure 28).

Figure 27: ECB’s BLS on German SMEs (demand side) Figure 28: ECB’s BLS on German SMEs (supply side)

-50

-30

-10

10

30

50

70

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Small/mid firms credit demand over the past 3 months (t)Expected credit demand for small/mid firms 3 months ahead …

(net percentage)

decrease

increase Q1'13e

-50

-30

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30

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2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Credit standards for small/mid firms over the past 3 months (t)Expected credit standards for small/mid firms 3 months ahead (t+1)

(net percentage)

tightened

eased

Q1'13e

Source: ECB Bank Lending Survey Q1 2013, Deutsche Bank presentation Source: ECB Bank Lending Survey Q1 2013, Deutsche Bank presentation

Over recent years, German-listed SMEs have raised their average equity ratio substantially, from 33% in 2004 to 37% in 2011 and, thus, have become less dependent on external financing. German-listed SMEs increased their equity ratios in excess of European (ex Germany) peers (see Figure 29). One main reason for the considerable improvement in capital levels is likely to have been increased requirements by banks. With the introduction of Basel II, capital requirements for corporate loans became more differentiated according to the level of risk, i.e. loans to lower-rated borrowers have to be backed by more equity now and are therefore more expensive. Companies, for their part, had an incentive to strengthen their balance sheets to reduce financing costs.

Figure 29: Equity ratio among German and Europe (ex

Germany) SMEs

Figure 30: Debt ratio among German and Europe (ex

Germany) SMEs

25.0

27.5

30.0

32.5

35.0

37.5

40.0

42.5

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

E

2014

E

Germany* Europe (ex Germany)*

(Equity ratio [Total shareholders' capital/Total assets], in %) DB forecast

15.0

17.5

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2006

2007

2008

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2010

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2012

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E

2014

E


(Debt ratio [Interest bearing debt/Total assets], in %) DB forecast

Source: Company data, Deutsche Bank estimates Source: Company data, Deutsche Bank estimates

9 April 2013



There is much to suggest that the increase will continue for the time being, as our analysts expect the ratio to increase to 41% in 2014 for German SMEs. Nevertheless, there are certain signs that the trend is levelling off going forward. The currently good earnings situation of many companies may favour a further increase. However, the extremely low interest rate level, which encourages higher leverage, may have the opposite effect, as does the declining importance of bank loans for corporate funding. This lower dependence on credit institutions also reduces the pressure of having a good credit rating via a high capital ratio.

Aggregating leverage (net debt/equity) and net interest cover (operating EBIT/net interest expenses) for German as well as for Europe (ex Germany) SMEs, reveals that German SMEs have a sounder financial base with lower leverage, and a higher net interest cover in addition to lower dependency on external financing.

Figure 31: German SMEs are less levered relative to

Europe (ex Germany) SMEs…

Figure 32: …accompanied by a higher a higher net

interest cover ratio

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Moreover, German SMEs generate higher returns on capital (see Figure 33) despite a significantly lower level of investment in fixed assets (see Figure 34), pointing towards higher capital efficiency.

Figure 33: German SMEs generate a superior return on

capital relative to Europe (ex Germany) SMEs…

Figure 34: ...despite a significantly lower level of

investments in fixed assets

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In a nutshell, we believe the most frequently-raised concern against investing in German SMEs, from a fundamental point of view, is not as critical as is often stressed and particularly not in a European comparison.

9 April 2013



1.5 P&L review: superior EPS strength comes at a premium

As P&L metrics vary strongly from sector to sector as well as from region to region, we focus on the historical development including 2013/14 estimates instead, in order to make the performance of German vs. European (ex Germany) SMEs comparable. We observe a significantly stronger operational gearing among German SMEs relative to European (ex Germany) peers given a stronger top line and more robust operating margins, which translated into a superior EPS growth profile over the past decade (2003-2012). Going forward, we expect this trend to continue, in line with our analysts’ bottom-up forecasts.

Figure 35: Key profit & loss (P&L) components Figure 36: Valuation ratios

1) Sales development

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(Sales development based on % change yoy, 2003=100) DB forecast

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9596979899

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9 April 2013



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9 April 2013



2 How to approach it In this section we highlight our key picks among German SMEs under Deutsche Bank coverage (section 2.1), review key trends and stock ideas within the most important sectors (section 2.2) and present relevant investable themes and styles (section 2.3).

2.1 German SME top picks: Our preferred Buy ideas

Overview

CompuGROUP Medical AG (COPMa.DE, Buy, target price: E23.0) (pages 20-21) CompuGROUP is one of the leading providers of software solutions for the healthcare sector in Germany, other European countries and Turkey (18 countries in total). According to company surveys, approximately 240,000 doctors/dentists use CompuGROUP's software solutions globally. In the doctor information systems business for doctors in private practice in Germany alone, CompuGROUP’s market share, measured by the number of installations with relevant doctors for the company, is approximately 43% and it is approximately 44% among dentists.

Duerr (DUEG.DE, Buy, target price: E95.0) (pages 22-23) Duerr engineers/builds plants and manufactures machinery for the automotive industry in Europe, North/South America and Asia. Duerr designs and constructs fully-automatic paint finishing plants, final assembly systems, and air purifier and water treatment systems. Duerr also produces computerised, camera-controlled production robots.

LEG (LEGn.DE, Buy, target price: 48.5) (pages 24-25) LEG is a well-managed residential property pure play on NRW. Following its financial and operational restructuring, LEG offers stable and predictable cash flows with rent increases, modernisation and external growth by consolidating the NRW market.

MorphoSys (MORG.DE, Buy, target price: E43.0) (pages 26-27) Although shares in MorphoSys have almost doubled in the past year, we continue to see excellent risk/reward in the name with multiple sources for a similar re-rating (or more). With the focus set to shift back on the pipeline and numerous potential positive catalysts ahead, we consider the current level a particularly attractive entry point.

Schaltbau AG (SLTG.DE, Buy, target price: E38.0) (pages 28-29) Germany-based Schaltbau is a leading manufacturer of components and systems for the transportation and capital goods industries. It operates in three business segments: Mobile Transportation Technology, Stationary Transport Technology, and Components. It has a widespread product portfolio including door systems for trains and buses/coaches, signalling and safety technology for rail infrastructure, and industrial brakes, as well as electrical components for an extensive number of applications.

Tom Tailor (TTIGn.DE, Buy, target price: E19.0) (pages 30-31) TTI's expansion in the retail and wholesale business, the firm’s focus on the middle income group along with an increasing focus on women's wear in the product mix and pricing power and operating leverage, should act as positive triggers in the near term.

United Internet (UTDI.DE, Buy, target price: E22.0) (pages 32-33) United Internet (UI) is a technology holding company offering telecommunication services in Germany under its 1&1 brand (DSL and mobile). In addition, UI is a leading Webhosting provider, operating globally. UI also runs two of the most successful general interest Internet portals in the German market (Web.de, GMX) and controls c. 50% of all email addresses in Germany. Lastly, UI has participations in several companies in the TMT space.

9 April 2013



Reuters Bloomberg COPMa.DE COP GY

Investment case: A solid business model backed by pricing power The company's core HPS segment is a leading software provider for doctors (c. 43% market share in Germany) and hospitals. While the market for doctors´ software, at least in Germany and France, is already mature and offers only limited incremental growth prospects, it serves as a reliable cash flow contributor for the remaining growth areas of this segment, i.e., international licenses and software for hospitals. In addition, underpinned by a solid business model with low churn rates among customers, we believe the company will be able to maintain its pricing power and successfully up-sell its products with minimum incremental cost. As a result, steady revenue growth and the benefits of consolidating its numerous recent acquisitions should result in significant margin expansion over our forecast years, in line with management’s goal of 30% EBITDA margins in the long term.

Recent events: Healthier by the quarter CompuGroup reported E450.7m revenue in 2012, of which E290m was through recurring sources such as software maintenance (up 28% yoy). Given the high switching costs involved (churn typically only ~4% p.a.) we believe CompuGroup will continue to experience low churn rates in its 385,000-strong client base. Also, given its market leadership, we believe it will maintain its pricing power in most of its markets and continue to up-sell its products. With the Jan. recurring revenue run-rate implying further 6% yoy growth in 2013, we expect total revenue of E481m, in line with 4-8% organic growth guidance. Given that revenue from maintaining and up-selling software comes with minimum incremental costs, we believe the company could experience significant margin improvement from growth in revenue. This was evident in 2012’s incremental EBITDA margins of 60%, with overall EBITDA margins improving to 23% in 2012 from 18% in 2011 (up c. 500bps). As management focuses more on improving profitability through tighter cost controls, we expect margins to continue to expand over our forecast years.

Valuation / Risks DCF-derived target price of E23 yields significant upside potential. Due to its stable business model and strong cash generating potential, we have used a three-stage DCF valuation to derive our target price. The key assumptions for our WACC of 6.6% are: a risk-free rate of 4.0%, risk premium of 4.5%, beta of 1.2, tax rate of 30.0%, and terminal growth of 2.5%. Key risks include: 1) unfavourable changes in regulation, 2) increasing competition, 3) unsuccessful integration of acquisitions, and 4) weak protection of patents.

Next Financial Event Q1 results are due 3 May, 2013.

Rating

Buy Europe Germany Healthcare & Medical Devices Facilities & Services

Company

Compugroup Medical AG

Price at 3 Apr 2013 (EUR) 17.59

Price Target (EUR) 23.00

52-week range (EUR) 18.33 - 10.56

Price/price relative

4

8

12

16

20

4/10 10/10 4/11 10/11 4/12 10/12

Compugroup Medical A

DJ (.STOXXE) (Rebased)

Performance (%) 1m 3m 12m

Absolute 0.5 19.9 59.9

DJ (.STOXXE) 0.9 0.1 8.7

Stock & option liquidity data

Market cap (EUR)(m) 883.0

Shares outstanding (m) 50

Free float (%) 50

Option volume (und. shrs., 1M avg.) –

9 April 2013



Model updated:01 March 2013

Running the numbers Europe

Germany

Facilities & Services

Compugroup Medical AG Reuters: COPMa.DE Bloomberg: COP GY

Buy Price (3 Apr 13) EUR 17.59

Target Price EUR 23.00

52 Week range EUR 10.56 - 18.33

Market Cap (m) EURm 883

USDm 1,134

Company Profile CompuGROUP is one of the leading providers in the market for software solutions for the healthcare sector in Germany, other European countries and Turkey (18 countries in total). According to company surveys, approximately 240,000 doctors and dentists use CompuGROUP's software solutions globally. In the doctor information systems business for doctors in private practice in Germany alone, CompuGROUPs market share measured by the number of installations with relevant doctors for the Company is approximately 43% and approximately 44% with dentists. The company was founded in 1987.

Price Performance

4

8

12

16

20

Apr 10 Oct 10 Apr 11 Oct 11 Apr 12 Oct 12

Compugroup Medical AGDJ (.STOXXE) (Rebased)

Margin Trends

812

1620

2428

09 10 11 12E 13E 14E

EBITDA Margin EBIT Margin

Growth & Profitability

051015202530

05

1015202530

09 10 11 12E 13E 14E

Sales growth (LHS) ROE (RHS)

Solvency

02468101214

0

50

100

150

200

09 10 11 12E 13E 14E

Net debt/equity (LHS) Net interest cover (RHS)

Uwe Schupp, CFA +49 69 910-31955 [email protected]

Fiscal year end 31-Dec 2009 2010 2011 2012E 2013E 2014E

Financial Summary DB EPS (EUR) 0.70 0.83 0.71 1.36 1.50 1.76Reported EPS (EUR) 0.24 0.33 0.18 0.77 0.97 1.23DPS (EUR) 0.25 0.25 0.25 0.46 0.53 0.62BVPS (EUR) 3.7 3.6 3.4 3.8 4.3 5.0

Weighted average shares (m) 50 50 50 50 50 50Average market cap (EURm) 295 443 500 883 883 883Enterprise value (EURm) 409 616 744 1,110 1,065 1,009

Valuation Metrics P/E (DB) (x) 8.3 10.6 14.0 13.0 11.7 10.0P/E (Reported) (x) 24.6 26.6 54.5 22.9 18.2 14.3P/BV (x) 2.03 3.06 2.59 4.60 4.07 3.50

FCF Yield (%) 9.0 5.0 5.1 7.4 7.8 9.3Dividend Yield (%) 4.3 2.9 2.5 2.6 3.0 3.5

EV/Sales (x) 1.4 2.0 1.9 2.5 2.2 2.0EV/EBITDA (x) 6.9 9.2 10.2 10.5 8.8 7.5EV/EBIT (x) 16.5 18.6 20.3 16.6 12.8 10.6

Income Statement (EURm) Sales revenue 293 312 397 451 481 511Gross profit 232 253 322 374 400 426EBITDA 59 67 73 105 121 134Depreciation 5 5 6 7 8 8Amortisation 29 29 30 31 30 30EBIT 25 33 37 67 83 95Net interest income(expense) -7 -7 -11 -12 -14 -7Associates/affiliates 0 0 0 0 0 0Exceptionals/extraordinaries 0 0 0 0 0 0Other pre-tax income/(expense) 0 0 0 0 0 0Profit before tax 18 27 25 55 69 88Income tax expense 7 10 16 16 21 26Minorities 0 0 0 0 0 0Other post-tax income/(expense) 0 0 0 0 0 0Net profit 12 17 9 39 49 62

DB adjustments (including dilution) 23 25 26 29 27 27DB Net profit 35 42 36 68 75 88

Cash Flow (EURm) Cash flow from operations 44 40 47 88 89 105Net Capex -17 -17 -21 -23 -20 -23Free cash flow 27 22 25 65 69 82Equity raised/(bought back) -4 0 0 -2 0 0Dividends paid 0 0 0 0 0 0Net inc/(dec) in borrowings 16 73 52 -3 0 0Other investing/financing cash flows -25 -82 -96 -45 -23 -26Net cash flow 13 13 -18 14 45 56Change in working capital 0 15 10 -1 -2 -5

Balance Sheet (EURm) Cash and other liquid assets 29 42 24 38 83 139Tangible fixed assets 37 39 50 71 75 82Goodwill/intangible assets 311 381 459 436 415 393Associates/investments 2 1 1 1 1 1Other assets 73 83 107 110 110 106Total assets 452 546 641 657 684 721Interest bearing debt 144 217 270 266 266 266Other liabilities 122 146 203 199 201 202Total liabilities 266 363 473 465 467 469Shareholders' equity 185 183 168 192 217 252Minorities 1 0 0 0 0 0Total shareholders' equity 186 183 168 192 217 253Net debt 115 175 246 228 183 127

Key Company Metrics Sales growth (%) 28.0 6.5 27.0 13.6 6.8 6.1DB EPS growth (%) 15.4 18.5 -14.0 90.1 10.9 17.3EBITDA Margin (%) 20.2 21.5 18.4 23.4 25.2 26.2EBIT Margin (%) 8.5 10.6 9.2 14.8 17.3 18.7Payout ratio (%) 105.1 75.9 136.5 60.3 54.2 50.1ROE (%) 6.6 9.0 5.2 21.4 23.8 26.3Capex/sales (%) 5.9 5.5 5.4 5.1 4.2 4.5Capex/depreciation (x) 0.5 0.5 0.6 0.6 0.5 0.6Net debt/equity (%) 61.9 95.4 146.1 119.1 84.3 50.3Net interest cover (x) 3.7 4.8 3.2 5.6 6.1 13.2

Source: Company data, Deutsche Bank estimates

9 April 2013



Reuters Bloomberg DUEG.DE DUE GY

Investment case: Outlook appears conservative, remaining 10% ahead of cons. Duerr is the global leader for auto paint shops with c. 50% market share – and in emerging markets its footprint is even stronger. Thus, we see the company benefiting from capacity expansion by OEMs in BRIC markets over the coming years. This and an improved cost base could result in even higher earnings. A strengthened balance sheet leaves room for bolt-on acquisitions and/or increased returns to shareholders. We forecast robust top-line growth and margin recovery based on recent order trends as well as the final fade out of low-margin businesses accepted during the crisis.

Recent events: Q4 exceeds expectations Duerr’s Q4’12 numbers were robust: in line on the top line but even ahead of our above-consensus forecast for EBIT. In Q4, revenues were E642m and EBIT was E58m (DBe: E55m, cons: E51m), i.e. 9% margin. New orders were E643m so 4% y/y after a 36% drop y/y in Q3 and a book/bill of 1x. FCF was even ahead of our expectation of E50m at E66m, indicating E125m in Q4. The final quarter did thus show the strongest quarterly FCF generation in Duerr’s history on what is its strongest EBIT margin ever. Net cash came to E100m. For the full year, EBIT margin was 7.4%, comfortably ahead of our 7.2% estimate and already close to our FY13 forecast of 7.5% (10% ahead of cons). The dividend is proposed to be E2.25, i.e. 36% payout ratio, slightly above last year’s c.30%. Duerr guides for slightly down order intake to E2.3-2.5bn (DBe: E2.4bn, cons: E2.2bn), increased sales of E2.4-2.6bn (DBe: E2.6bn, cons: E2.5bn) and improved earnings with a margin between 7.0-7.5% (DBe: 7.5%, cons: 7.4%). We note Duerr tends to be very conservative at the beginning of the year (several guidance increases last year) and the new orders as well as sales exit rate appear to leave upside to the outlook. Additionally, the order backlog stands at E2.3bn, ~1y sales (DBe: E2.3bn). We feel comfortable with our forecasts c. 10% ahead of cons and expect the Street to move in our direction. In the CC, Duerr confirmed our view that the backlog is of better margin quality and that current trading looks good. Thus, we believe the utilization rate should remain high - and as there are no special impacts visible that should weigh on margins, we see decent upside to margin guidance.

Valuation / Risks We value Duerr on an equally weighted mix of 2013E EV/EBITDA peer group multiple, DCF (WACC of 8.5%, TG 1.5%) and an EV/IC model ((ROIC - g)/(WACC - g), with g of 0%). We focus on 2012E as we want to mirror the expected recovery post-2010 and apply a 3-stage DCF model to consider mid-term earnings potential. Oe adjusted our estimates and raised our TP to E95 after the strong Q4 on an equally weighted mix of 2013E EV/EBITDA peer group multiple, DCF and EV/IC model ((ROIC-g)(WACC-g), g 0%). Risks include slower-than-expected industry CAPEX growth, a slowdown in Emerging Markets, and M&A.

Next Financial Event Q1’13 results on the 7th of May and potentially comments on current trading around our DB Small and Mid cap conference on the 10th and 11th of May.

Rating

Buy Europe Germany Capital Goods Engineering

Company

Duerr



52-week range (EUR) 87.25 - 39.43


0

20

40

60

80

100

4/10 10/10 4/11 10/11 4/12 10/12

Duerr



Absolute 1.2 24.3 74.6

DJ (.STOXXE) 0.9 0.1 8.7


Market cap (EUR)(m) 1,493.2


Free float (%) 64


9 April 2013



Model updated:19 February 2013


Germany

Engineering

Duerr Reuters: DUEG.DE Bloomberg: DUE GY



52 Week range EUR 39.43 - 87.25

Market Cap (m) EURm 1,359

USDm 1,769

Company Profile Duerr AG engineers and builds plants and manufactures machinery for the automotive industry in Europe, North and South America, and Asia. The Company designs and constructs fully automatic paint finishing plants, final assembly systems, and air purifier and water treatment systems. Duerr also produces computerized, camera-controlled production robots.

Price Performance

0

20

40

60

80

100


Duerr DJ (.STOXXE) (Rebased)

Margin Trends

02

46

810

09 10 11 12E 13E 14E



-20

-10

0

10

20

30

-40

-20

0

20

40

60

09 10 11 12E 13E 14E


Solvency

0

2

4

6

8

10

-40

-30

-20

-10

0

10

09 10 11 12E 13E 14E


Tim Rokossa +49 69 910-31998 [email protected]


Financial Summary DB EPS (EUR) -1.60 0.37 3.58 6.44 7.65 7.51Reported EPS (EUR) -1.60 0.37 3.58 6.44 7.65 7.51DPS (EUR) 0.00 0.30 1.20 2.25 2.68 3.00BVPS (EUR) 17.0 18.1 20.7 28.6 33.9 38.7

Weighted average shares (m) 17 17 17 17 17 17Average market cap (EURm) 211 331 468 1,359 1,359 1,359Enterprise value (EURm) 259 361 499 1,340 1,249 1,165

Valuation Metrics P/E (DB) (x) nm 52.3 7.6 12.2 10.3 10.5P/E (Reported) (x) nm 52.3 7.6 12.2 10.3 10.5P/BV (x) 1.00 1.32 1.64 2.75 2.32 2.03



Income Statement (EURm) Sales revenue 1,078 1,261 1,922 2,400 2,596 2,661Gross profit 221 237 331 438 493 506EBITDA 26 53 129 202 228 227Depreciation 20 19 23 25 26 25Amortisation 0 0 0 0 0 0EBIT 6 34 106 177 202 202Net interest income(expense) -19 -22 -21 -29 -23 -22Associates/affiliates 1 1 1 0 1 1Exceptionals/extraordinaries 0 0 0 0 0 0Other pre-tax income/(expense) 0 0 0 0 0 0Profit before tax -12 13 86 148 180 181Income tax expense 14 5 22 36 47 51Minorities 2 1 2 0 1 0Other post-tax income/(expense) 0 0 0 0 0 0Net profit -28 6 62 111 132 130

DB adjustments (including dilution) 0 0 0 0 0 0DB Net profit -28 6 62 111 132 130

Cash Flow (EURm) Cash flow from operations 81 38 128 118 150 153Net Capex -16 -14 -19 -28 -29 -23Free cash flow 65 24 109 90 121 130Equity raised/(bought back) 0 0 0 0 0 0Dividends paid -14 -1 -7 -21 -39 -46Net inc/(dec) in borrowings -22 125 3 0 0 0Other investing/financing cash flows -8 2 -59 0 0 0Net cash flow 21 150 46 69 82 84Change in working capital 95 30 -5 0 -8 -1

Balance Sheet (EURm) Cash and other liquid assets 104 252 299 349 440 524Tangible fixed assets 109 114 167 173 181 184Goodwill/intangible assets 308 316 327 321 316 310Associates/investments 14 12 20 20 20 20Other assets 433 521 849 849 862 864Total assets 968 1,216 1,661 1,711 1,818 1,902Interest bearing debt 104 232 286 286 286 286Other liabilities 563 665 1,011 993 939 940Total liabilities 667 897 1,297 1,279 1,225 1,226Shareholders' equity 295 313 359 494 587 670Minorities 6 6 5 5 5 5Total shareholders' equity 301 319 364 500 593 675Net debt 0 -20 -12 -63 -154 -238

Key Company Metrics Sales growth (%) -32.8 17.1 52.4 24.9 8.2 2.5DB EPS growth (%) na na 878.5 80.1 18.7 -1.8EBITDA Margin (%) 2.4 4.2 6.7 8.4 8.8 8.5EBIT Margin (%) 0.5 2.7 5.5 7.4 7.8 7.6Payout ratio (%) nm 82.1 33.6 34.9 35.0 40.0ROE (%) -8.8 2.1 18.4 26.1 24.5 20.7Capex/sales (%) 1.6 1.2 1.0 1.2 1.1 0.9Capex/depreciation (x) 0.9 0.8 0.9 1.1 1.1 0.9Net debt/equity (%) 0.0 -6.3 -3.4 -12.6 -25.9 -35.2Net interest cover (x) 0.3 1.6 5.0 6.1 8.8 9.2


9 April 2013



Reuters Bloomberg LEGn.DE LEG GR

Investment case: High visibility on inflation-linked cash flows LEG is a well-managed residential property pure play on NRW. Management pursues a buy-and-manage approach with value enhancement coming from further rent increases, vacancy reduction and increasing margins by adding more units at low incremental cost. Its long debt duration and 40% exposure to rent-restricted units provide good visibility on cash flows, which are inflation-protected through regular rent adjustments to CPI.

Recent events: Rents to benefit from household growth and immigration; no major short-term refinancing needs Rents have increased 2.3% per annum (like-for-like) since 2008, outperforming both inflation and the NRW market. We expect further rental upside from rising demand in many parts of the NRW housing market, driven by ~13.5% 1- to 2- person household growth in NRW over 2009-30 meeting low supply. In addition, stronger-than-expected immigration into the region could serve as an upside surprise to demand. The higher education levels of recent immigrants should further enhance affordability in the region, which again could benefit rents and prices. Regarding financing, LEG has a long, 13-year debt duration with no major short-term refinancing needs and a low 3.3% cost of debt. Its modest LTV of 48% offers the benefit of a low marginal cost of debt and should allow the company to re-lever up to 55% maximum target leverage through acquisitions without the need to tap the market. The debt portfolio is almost entirely hedged/fixed. We expect 5% CAGR in net rental income (2012-16), mainly on the back of rental growth and what we see as conservative acquisition assumptions. We expect FFO (excluding sales) to rise 6% per annum, fuelled by a stable cost of debt and efficiency gains via platform expansion. LEG targets a 65% payout ratio of FFO (excluding sales) starting in 2013 and one-fourth of that level for 2012.

Valuation / Risks We set our PT by applying a target premium/ disc. to 1-yr. forward DB NAV. We value LEG at our 2013E DB NAV to derive our E48.5 PT. We expect LEG to trade at a10% relative discount to GSW which we consider the closest peer. Risks include asset class, social charter, inflation protection.

Next Financial Event LEG releases its 2012 Annual Report on 30 April 2013.

Rating

Buy Europe Germany Real Estate Real Estate

Company

LEG



52-week range (EUR) 44.00 - 41.60


41.0

42.0

43.0

44.0

45.0

46.0

2/13

LEG



Absolute -4.5 2,926.4

2,926.4

DJ (.STOXXE) 0.2 -0.9 10.9


Average Market cap (EUR)(m) 2,206.2


Free float (%) –


9 April 2013





Germany

Real Estate

LEG Reuters: LEGn.DE Bloomberg: LEG GR



52 Week range EUR 41.26 - 44.00


USDm 2,843

Company Profile LEG Immobilien AG was founded in 1970 by the Federal State of North Rhine Westphalia (NRW) to provide affordable living space in the region. The company was privatized in 2008 and IPO'd in 2013. LEG is a pure play on residential property in NRW, Germany's most populous state. With c.90k units valued around E4.9bn, the group is the fifth largest residential landlord in Germany. The group offers stable and predictable cash flows, with value enhancing opportunities arising from rent increases and acquisitions.

Price Performance

41.0

42.0

43.0

44.0

45.0

46.0

Feb 13

LEG DJ (.STOXXE) (Rebased)

Margin Trends

3640444852566064

10 11 12E 13E 14E



-20246810

0

1

2

3

4

10 11 12E 13E 14E


Solvency

0

1

1

2

2

3

85

90

95

100

105

110

10 11 12E 13E 14E


Markus Scheufler +44 20 754-18170 [email protected]

Fiscal year end 31-Dec 2010 2011 2012E 2013E 2014E

Financial Summary DB EPS (EUR) 2.12 2.11 2.55 2.64 2.88Reported EPS (EUR) 0.54 -0.29 2.29 1.99 3.49DPS (EUR) 0.00 0.00 0.41 1.72 1.87BVPS (EUR) 42.3 40.5 41.7 43.2 45.0

Weighted average shares (m) 53 53 53 53 53Average market cap (EURm) na na 2,185 2,185 2,185Enterprise value (EURm) na na 4,608 4,666 4,764

Valuation Metrics P/E (DB) (x) na na 16.2 15.6 14.3P/E (Reported) (x) na nm 18.0 20.8 11.8P/BV (x) 0.00 0.00 0.99 0.95 0.92

FCF Yield (%) na na 1.2 0.7 1.9Dividend Yield (%) na na 1.0 4.2 4.5

EV/Sales (x) nm nm 9.0 8.8 8.7EV/EBITDA (x) nm nm 15.1 18.4 14.4EV/EBIT (x) nm nm 15.4 18.8 14.7

Income Statement (EURm) Sales revenue 487 499 510 529 547Gross profit 282 286 302 309 322EBITDA 228 190 306 254 330Depreciation 7 7 6 6 6Amortisation 0 0 0 0 0EBIT 221 184 300 248 324Net interest income(expense) -166 -172 -176 -140 -136Associates/affiliates 0 0 0 0 0Exceptionals/extraordinaries 0 0 0 0 0Other pre-tax income/(expense) 2 -2 0 0 0Profit before tax 58 9 123 107 187Income tax expense 29 24 2 2 2Minorities 0 0 0 0 0Other post-tax income/(expense) 0 0 0 0 0Net profit 29 -15 121 105 185

DB adjustments (including dilution) 84 127 14 35 -33DB Net profit 112 112 135 140 152

Cash Flow (EURm) Cash flow from operations 112 77 106 116 146Net Capex -29 -31 -80 -102 -104Free cash flow 83 46 26 15 41Equity raised/(bought back) 0 0 0 0 0Dividends paid 0 0 0 -22 -91Net inc/(dec) in borrowings -48 39 122 19 20Other investing/financing cash flows -76 -87 -61 0 0Net cash flow -40 -2 88 12 -30Change in working capital 41 60 26 0 0

Balance Sheet (EURm) Cash and other liquid assets 84 82 169 181 152Tangible fixed assets 4,769 4,812 4,994 5,126 5,309Goodwill/intangible assets 3 6 6 6 6Associates/investments 12 11 13 13 13Other assets 134 78 96 96 96Total assets 5,002 4,988 5,278 5,422 5,575Interest bearing debt 2,210 2,307 2,490 2,557 2,624Other liabilities 551 536 582 575 568Total liabilities 2,761 2,842 3,071 3,132 3,192Shareholders' equity 2,241 2,146 2,206 2,290 2,384Minorities 0 0 0 0 0Total shareholders' equity 2,241 2,146 2,206 2,290 2,384Net debt 2,127 2,225 2,320 2,376 2,472

Key Company Metrics Sales growth (%) nm 2.4 2.3 3.6 3.5DB EPS growth (%) na -0.5 20.9 3.5 8.8EBITDA Margin (%) 46.8 38.2 59.9 48.0 60.3EBIT Margin (%) 45.4 36.8 58.7 46.8 59.2Payout ratio (%) 0.0 nm 18.1 86.5 53.5ROE (%) 1.3 -0.7 5.6 4.7 7.9Capex/sales (%) 5.1 4.9 15.6 19.2 19.1Capex/depreciation (x) 3.8 3.7 12.8 16.3 16.7Net debt/equity (%) 94.9 103.7 105.2 103.8 103.7Net interest cover (x) 1.3 1.1 1.7 1.8 2.4


9 April 2013



Reuters Bloomberg MORG.DE MOR GY

Investment case: All eyes on pipeline potential One of the key strengths of MorphoSys remains its highly profitable and cash-generative partnership model for the development of antibody-based drugs (>$50bn market). The corresponding pipeline has evolved into one of the broadest in the industry, holding considerable and well diversified valuation potential as MorphoSys stands to benefit from committed R&D funding as well as success-based milestones and royalties on each of the partnered programs. In addition, visible cash flows from partners allow MorphoSys to fully fund the development of its own programs, which could yield even greater upside from partnering at a later stage.

Recent events: MOR103 in focus Even on our conservative base case assumptions (i.e. pipeline attrition in line with industry average, but peak sales below), we find that the current EV of MorphoSys is fully supported by the partnered pipeline alone, suggesting free upside potential from MOR103 (the company’s proprietary blockbuster candidate in RA) as well as from other proprietary programs and potential new partnerships (based on its latest antibody technology Ylanthia). In a blue-sky scenario (i.e., pipeline attrition and peak sales in line with industry average), shares could double even if all proprietary programs failed or even triple if MOR103 would make it to market. First and foremost, a potential partnering deal for MOR103 over the course of 2013 should attract significant attention from investors and could prove a major positive catalyst for shares. Furthermore, up to five partnered programs are due to complete phase II trials in 2013/14, an important benchmark for further validation of the pipeline potential. In addition, Gantenerumab (Roche’s blockbuster candidate in Alzheimer’s) may report interim phase II/III data as early as this year, while MOR202 (MorphoSys’ proprietary anti-CD38 antibody in multiple myeloma) may report interim data from the ongoing ph. I/IIa open label trial. As usual, setbacks are unavoidable, but as long as data are in line with typical attrition, we expect substantial shareholder value creation independent of macro cycle.

Valuation / Risks We value MorphoSys on a DCF model (WACC 9%, forecast horizon until 2036 with no terminal growth thereafter) as we believe this best mirrors the long-term visible, macro-independent growth profile and valuation potential of its partnered and proprietary pipeline as well as other assets. On a per share basis, we attribute a value of E16.5 for the Novartis collaboration, E10 for other collaborations, E10.5 for MOR103, E6 for net cash, while taking a neutral view on proprietary pipeline activities (ex MOR103). Key risks include 1) Lack of partnering on MOR103, 2) pipeline failure beyond typical attrition, 3) lower than expected peak sales and 4) proprietary pipeline overspent.

Next Financial Event Q1’13 results are scheduled for May 03, but are unlikely to create excitement. Given the disposal of AbD Serotec end of last year, no milestones or partnering income but higher proprietary R&D (as guided), we expect reported revenues to decline, negative EBIT in the mid/high single-digit EURm range.

Rating

Buy Europe Germany Biotechnology Biotechnology

Company

MorphoSys



52-week range (EUR) 35.40 - 16.11


812162024283236

4/10 10/10 4/11 10/11 4/12 10/12

Morphosys



Absolute 0.6 1.0 56.1

DJ (.STOXXE) -3.4 -2.5 9.3




Free float (%) –


9 April 2013





Germany

Biotechnology

Morphosys Reuters: MORG.DE Bloomberg: MOR GY



52 Week range EUR 16.11 - 35.40


USDm 912

Company Profile MorphoSys is one of the world's leading biotechnology companies focusing on fully human antibodies. With its proprietary technologies, MorphoSys is developing not only the next generation of therapeutic antibodies, but also antibodies for research and diagnostics purposes. HuCAL® (Human Combinatorial Antibody Library) is the company's core technology for the rapid and automated production of specific antibodies. MorphoSys runs 68 partnered therapeutic antibody programs and works on 10 proprietary compounds.

Price Performance

812162024283236


Morphosys DJ (.STOXXE) (Rebased)

Margin Trends

-45-30

-150

1530

10 11 12 13E 14E 15E



-8-6-4-20246

-60

-40

-20

0

20

10 11 12 13E 14E 15E


Solvency

-35-30-25-20-15-10

-50

10 11 12 13E 14E 15E


Gunnar Romer +49 69 910-31917 [email protected]


Financial Summary DB EPS (EUR) 0.40 0.36 0.10 -0.58 -0.56 -0.54Reported EPS (EUR) 0.40 0.36 0.10 -0.58 -0.56 -0.54DPS (EUR) 0.00 0.00 0.00 0.00 0.00 0.00BVPS (EUR) 8.2 8.6 8.8 8.7 8.1 7.6

Weighted average shares (m) 23 23 23 23 23 23Average market cap (EURm) 366 436 477 701 701 701Enterprise value (EURm) 258 302 356 555 577 598

Valuation Metrics P/E (DB) (x) 40.0 53.6 203.7 nm nm nmP/E (Reported) (x) 40.0 53.6 203.7 nm nm nmP/BV (x) 2.26 2.04 3.34 3.51 3.76 4.03

FCF Yield (%) nm 5.4 nm nm nm nmDividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0

EV/Sales (x) 3.0 3.0 6.9 11.1 11.0 10.9EV/EBITDA (x) 16.1 16.1 40.5 nm nm nmEV/EBIT (x) 26.1 24.8 143.0 nm nm nm

Income Statement (EURm) Sales revenue 87 101 52 50 53 55Gross profit 80 94 52 50 53 55EBITDA 16 19 9 -19 -18 -17Depreciation 6 7 6 1 1 1Amortisation 0 0 0 0 0 0EBIT 10 12 2 -20 -19 -18Net interest income(expense) 4 1 1 1 1 1Associates/affiliates 0 0 0 0 0 0Exceptionals/extraordinaries 0 0 0 0 0 0Other pre-tax income/(expense) -1 -2 0 5 0 0Profit before tax 13 11 3 -14 -19 -18Income tax expense 4 3 1 -1 -6 -5Minorities 0 0 0 0 0 0Other post-tax income/(expense) 0 0 0 0 0 0Net profit 9 8 2 -13 -13 -12

DB adjustments (including dilution) 0 0 0 0 0 0DB Net profit 9 8 2 -13 -13 -12

Cash Flow (EURm) Cash flow from operations 2 27 2 -20 -19 -19Net Capex -14 -3 -2 -2 -3 -3Free cash flow -12 24 -1 -23 -22 -21Equity raised/(bought back) 3 3 3 0 0 0Dividends paid 0 0 0 0 0 0Net inc/(dec) in borrowings 0 0 0 0 0 0Other investing/financing cash flows 12 -14 -10 48 0 0Net cash flow 3 12 -7 25 -22 -21Change in working capital 25 30 12 13 18 18

Balance Sheet (EURm) Cash and other liquid assets 44 55 41 66 44 23Tangible fixed assets 6 6 3 7 11 14Goodwill/intangible assets 69 66 35 33 31 29Associates/investments 64 80 80 80 80 80Other assets 26 22 65 28 34 41Total assets 210 228 223 213 199 186Interest bearing debt 0 0 0 0 0 0Other liabilities 24 31 18 14 14 13Total liabilities 24 31 19 14 14 13Shareholders' equity 186 197 202 200 186 174Minorities 0 0 0 0 0 0Total shareholders' equity 186 197 202 200 186 174Net debt -44 -55 -41 -66 -44 -23

Key Company Metrics Sales growth (%) 7.4 15.8 -48.5 -3.7 5.0 4.8DB EPS growth (%) 1.6 -12.0 -71.4 na 3.2 4.4EBITDA Margin (%) 18.3 18.6 17.0 -38.0 -34.6 -31.5EBIT Margin (%) 11.3 12.1 4.8 -40.0 -36.5 -33.3Payout ratio (%) 0.0 0.0 0.0 nm nm nmROE (%) 5.1 4.3 1.2 -6.7 -6.8 -6.9Capex/sales (%) 15.9 3.6 4.5 5.0 4.8 4.6Capex/depreciation (x) 2.3 0.5 0.4 2.5 2.5 2.6Net debt/equity (%) -23.7 -27.7 -20.1 -33.1 -23.6 -13.2Net interest cover (x) nm nm nm nm nm nm


9 April 2013



Reuters Bloomberg SLTG.DE SLT GR

Investment case: specialized in niche markets As the past cycle proved, Schaltbau is less affected by economic swings outperforming its underlying end markets given its high exposure to the rail industry and extensive diversification into niche markets with few competitors. Along a currently strong order backlog, we thus expect solid performance in 2013 despite the low volume environment in Europe. Further, we expect the company to return to above-market growth rates going forward via i) continuously high innovation levels that should lead to market share gains, access to new costumer groups and increasing margins (R&D spending c. 6-7% of sales), ii) further regional expansion with particularly promising growth opportunities in Chinese rail markets, as well as iii) a controlled acquisition strategy in a consolidating market. Along an improving balance sheet, we thus think Schaltbau is a solid investment in a challenging economic environment.

Recent events: FY12 profit pre-release - a solid finish; 2013 outlook unchanged Schaltbau has issued preliminary FY12 results which suggest strong order intake (+9% y/y to E372m) and sales (+14% y/y to E363m) as well as a solid EBIT development (E29.5) especially in view of integration /acquisition expenses for Tiefenbach and substantially increased R&D and personnel costs. This implies a strong Q4 result and suggests that the acquisition of Tiefenbach has turned profitable now (Q4 sales +17%y/y, EBIT +75% y/y, 8.8% margin). Schaltbau issued a dividend proposal of 0.77E significantly above our estimate of 0.65E and consensus of 0.6E. Schaltbau has not issued a new guidance and we assume that the outlook from November remains valid. The company envisages sales of E374m (+7% y/y), EBIT of cE33m (+13% y/y, 8.8% margin) and net income of cE22m. This is roughly in line with consensus and slightly below our forecasts (about 5%) but we generally regard management as relatively conservative.

Valuation / Risks We value Schaltbau on an equal blend of two valuation metrics. We use forward-looking EV/EBIT and PE multiples to reflect earnings potential and sentiment relative to business cycle and peers. We use DCF valuation given the company's relatively stable business model and cash-generation potential. Schaltbau trades at a significant discount to peers, which we think is unjustified given its above-average-growth potential. Risk: Key downside risks to our forecasts include: i) Significant public spending cuts especially in Schaltbau's core market Germany, ii) A prolonged economic decline that would hurt the capital goods exposure, iii) Adverse regulatory changes, iv) Failure to successfully integrate acquisitions, and v) Dependence on a few large customers such as Deutsche Bahn which could limit pricing leverage.

Next Financial Date Schaltbau pre-released headline numbers reflecting a strong year in a difficult economic environment. Next financial event will be on 23th of April when the company releases final FY12 results.

Rating

Buy Europe Germany Capital Goods Engineering

Company

Schaltbau Holding AG



52-week range (EUR) 35.17 - 24.33


0

10

20

30

40

4/10 10/10 4/11 10/11 4/12 10/12

Schaltbau Holding Ag



Absolute -5.2 -1.0 14.8

DJ (.STOXXE) -3.4 -2.5 9.3




Free float (%) 1


9 April 2013



Model updated:18 January 2013


Germany

Engineering

Schaltbau Holding Ag Reuters: SLTG.DE Bloomberg: SLT GR



52 Week range EUR 24.33 - 35.17


USDm 252

Company Profile Germany-based Schaltbau is a leading manufacturer of components and systems for the transportation and capital goods industries. It operates in three business segments: Mobile Transportation Technology, Stationary Transport Technology and Components. It has a widespread product portfolio including door systems for trains and busses/coaches, signaling and safety technology for rail infrastructure, industrial brakes well as electrical components for an extensive number of applications.

Price Performance

0

10

20

30

40


Schaltbau Holding AgDJ (.STOXXE) (Rebased)

Margin Trends

8.0

9.0

10.0

11.0

12.0

10 11 12 13E 14E 15E



0102030405060

0

5

10

15

10 11 12 13E 14E 15E


Solvency

0

2

4

6

8

10

020406080

100120140

10 11 12 13E 14E 15E


Felicitas Bismarck +49 69 910-31975 [email protected]





FCF Yield (%) 4.0 9.6 nm 1.8 8.5 8.1Dividend Yield (%) 2.4 2.6 2.4 2.4 3.2 3.7


Income Statement (EURm) Sales revenue 280 318 363 397 421 451Gross profit 133 152 173 189 201 215EBITDA 30 35 37 41 47 52Depreciation 6 7 8 8 9 9Amortisation 0 0 0 0 0 0EBIT 24 27 30 33 38 42Net interest income(expense) -6 -6 -5 -6 -5 -5Associates/affiliates 1 2 2 2 2 2Exceptionals/extraordinaries 0 0 0 0 0 0Other pre-tax income/(expense) -1 2 0 0 0 0Profit before tax 18 25 27 29 35 40Income tax expense 3 3 5 6 7 8Minorities 3 3 3 3 3 4Other post-tax income/(expense) 0 0 0 0 0 0Net profit 12 19 19 20 25 28

DB adjustments (including dilution) 0 -3 0 0 0 0DB Net profit 12 16 19 20 25 28

Cash Flow (EURm) Cash flow from operations 11 22 8 14 28 28Net Capex -8 -9 -9 -11 -11 -12Free cash flow 3 13 -1 3 16 16Equity raised/(bought back) 0 0 0 0 0 0Dividends paid -1 -2 -4 -4 -5 -6Net inc/(dec) in borrowings -7 0 5 -1 3 4Other investing/financing cash flows 7 -10 0 0 0 0Net cash flow 3 1 1 -2 15 13Change in working capital -13 -2 -20 -13 -6 -10


Key Company Metrics Sales growth (%) 3.9 13.5 14.0 9.5 5.9 7.2DB EPS growth (%) -1.7 33.4 11.9 6.8 24.7 13.9EBITDA Margin (%) 10.8 10.9 10.3 10.4 11.2 11.4EBIT Margin (%) 8.5 8.6 8.2 8.4 9.1 9.4Payout ratio (%) 16.9 19.2 21.0 23.0 25.0 25.0ROE (%) 54.0 46.2 31.2 26.4 26.6 24.7Capex/sales (%) 2.9 2.7 2.5 2.7 2.7 2.6Capex/depreciation (x) 1.3 1.2 1.2 1.3 1.3 1.3Net debt/equity (%) 130.7 52.2 45.6 37.1 20.0 10.0Net interest cover (x) 3.8 4.3 6.0 5.1 7.0 8.5


9 April 2013



Reuters Bloomberg TTIGn.DE TTI GR

Investment case: The best of two worlds After the Bonita acquisition in summer 2012, the Tom Tailor Group is all about complementarities: young fashion (TT) and ‘best ager’ segment (Bonita), wholesale and retail background, focus on collection and focus on logistics. Bonita should be able to fix its like-for-like sales weakness until end 2013 and then generate growth again, driven by improved products and shorter lead times. TT's own stores will be transferred simultaneously to Bonita's state of the art logistics platform step by step, taking until 2014. The combination of best practices should result in 20%+ clean EPS growth in 2013 and 2014.

Recent events: Tom Tailor brand strong, Bonita turnaround from H2-13 onwards The Tom Tailor brand has continuously outperformed the market with strong lfl and total sales growth, due to rapidly improving brand awareness and customers’ willingness to buy. This should benefit the brand in the future as well. Contrarily, the acquired Bonita brand saw sales decline on a lfl basis in 2012. Going forward, we expect positive lfl sales growth from H2-13 onwards with the first new collections under TT management. Additionally, we expect sales growth to be boosted by 100 stores openings p.a. (60 TT, 40 Bonita). We believe a higher share of direct sourcing should result in margin expansion. So far sales growth has not translated into a sustainable margin expansion; instead margins were burdened by frequent one-offs, in our view the main reason for TT’s discount to peers. Because of various growth initiatives operating leverage will likely not be on the agenda before 2014, but an improving gross margin from a higher share of direct sourcing should help margins in 2013. Therefore, we are modestly above company guidance with our 2013 forecasts of EUR 912m sales and a recurring EBITDA margin of 12.7% (vs. guidance of >EUR900m and 12% respectively).

Valuation / Risks Our target price of EUR 19 is 10x our 2014 clean EPS. This represents a c.10% discount to the historical trading level of the company since its IPO (11x) and puts it at a discount to European peers (clothing and general retail companies). We apply a discount as Tom Tailor is implementing several projects in parallel and therefore, execution risk has grown since the IPO. Major risks: ability to implement its growth strategy (i.e., ambitious target for retail store network); hurdles in overseas expansion plans and execution risk in the integration of Bonita into the group, as well as continued lacklustre margin developments.

Next Financial Date Tom Tailor is due to report Q1-13 on 8 May 2013. Our expectations for the top line are moderate after challenging weather conditions but we look for significant gross margin improvements from a higher share of direct sourcing.

Rating

Buy Europe Germany Consumer Discretionary & Luxury Other Consumer Discretionary

Company

Tom Tailor



52-week range (EUR) 18.26 - 10.75


8

10

12

14

16

18

20

4/10 10/10 4/11 10/11 4/12 10/12

Tom Tailor



Absolute -0.4 3.7 30.0

DJ (.STOXXE) -3.4 -2.5 9.3




Free float (%) –


9 April 2013





Germany

Other Consumer Discretionary

Tom Tailor Reuters: TTIGn.DE Bloomberg: TTI GR



52 Week range EUR 10.75 - 18.26


USDm 495

Company Profile Founded in 1962 and listed since 2010, Tom Tailor is a vertically integrated fashion company, offering casual wear for men, women and children. The two main product lines are Tom Tailor Casual and Tom Tailor Denim. The company's products are sold in 35 countries worldwide through more than 6,000 points of sale. The main growth driver is the company's own retail activities. About two thirds of sales are generated in Germany.

Price Performance

8101214161820


Tom Tailor DJ (.STOXXE) (Rebased)

Margin Trends

0

4

8

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16

10 11 12 13E 14E 15E



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25

0102030405060

10 11 12 13E 14E 15E


Solvency

0

2

4

6

8

10

020406080

100120

10 11 12 13E 14E 15E


Michael Kuhn +49 69 910-36642 [email protected]





FCF Yield (%) nm nm nm 12.3 14.9 20.8Dividend Yield (%) 0.0 1.3 0.0 1.7 2.9 4.1


Income Statement (EURm) Sales revenue 348 412 630 912 997 1,083Gross profit 160 202 333 502 558 612EBITDA 30 46 55 109 138 156Depreciation 15 20 33 45 53 56Amortisation 8 5 5 8 5 5EBIT 7 21 16 56 80 96Net interest income(expense) -11 -7 -16 -18 -14 -10Associates/affiliates 0 0 0 0 0 0Exceptionals/extraordinaries 0 0 0 0 0 0Other pre-tax income/(expense) 0 0 0 0 0 0Profit before tax -4 14 0 38 67 85Income tax expense -7 4 -3 11 20 26Minorities 0 0 3 3 3 3Other post-tax income/(expense) 0 0 0 0 0 0Net profit 2 10 0 24 44 57

DB adjustments (including dilution) 10 5 22 15 3 3DB Net profit 12 15 22 39 47 60

Cash Flow (EURm) Cash flow from operations 7 14 6 79 94 111Net Capex -27 -22 -149 -32 -32 -24Free cash flow -20 -8 -143 47 62 87Equity raised/(bought back) 0 0 21 0 0 0Dividends paid 0 0 0 0 0 0Net inc/(dec) in borrowings -110 -5 170 -16 -60 -60Other investing/financing cash flows 138 0 17 -1 -8 -13Net cash flow 8 -13 65 30 -6 14Change in working capital -12 -22 -77 -1 -12 0


Key Company Metrics Sales growth (%) 15.8 18.4 53.0 44.9 9.3 8.6DB EPS growth (%) 607.9 5.9 29.8 33.0 21.5 27.7EBITDA Margin (%) 8.6 11.3 8.7 12.0 13.8 14.4EBIT Margin (%) 2.0 5.1 2.6 6.1 8.1 8.8Payout ratio (%) 0.0 28.6 0.0 27.8 27.7 29.9ROE (%) 14.7 9.4 0.2 10.6 17.1 19.2Capex/sales (%) 7.7 5.4 23.6 3.5 3.2 2.2Capex/depreciation (x) 1.8 1.1 4.4 0.7 0.6 0.4Net debt/equity (%) 52.0 65.6 113.2 83.1 52.9 22.7Net interest cover (x) 0.6 2.9 1.0 3.2 5.9 9.2


9 April 2013



Reuters Bloomberg UTDI.DE UTDI GY

Investment case: The re-rating looks set to continue FY12 results demonstrated that United Internet’s growth strategy is unfolding according to plan. The “Access” segment showed a strong acceleration in growth as well as an impressive margin expansion. In FY13 and FY14 we expect “Applications” to follow suit, fuelled by customer wins in new markets as well as successful up-selling. Continued strong contract customer wins (guidance +1m) should provide high visibility on 2014. We therefore believe that the shares deserve a further re-rating as 20% EPS CAGR through 2015E is not adequately priced in at 16.5x FY13E P/E. Recent events United Internet reported FY12 results on 21 March. We believe the numbers as well as the (more detailed) outlook for FY13 fully support our investment case. Group revenues grew by an impressive 14.4% to Euro 2.4bn, driven by the “Access” segment (+15.9% y/y). EBITDA of Euro 344m (-6% y/y) was depressed by c. Euro 124m of incremental costs related to the international roll-out of webhosting and the launch of DE-mail in Germany. The ‘established’ businesses showed an EBITDA of Euro 450m, up 17% y/y. For FY13, management guided for revenue growth of c. 10% which was broadly in-line with our expectations. The EBITDA target of c. Euro 400m, however, was c. 5% below our forecast. At the same time, UI aims for c. 1m new contract customer wins, which compares to 850k in our model. Hence, we believe the overall guidance set is not only consistent but also provides better than expected visibility on continued growth beyond 2013. The EPS target corridor for FY13 remained Euro 1.00-1.10. Valuation / Risks Due to its holding character, we value United Internet shares on a Sum-of-the-Parts analysis (SOTP). We assess the value of the "Access" division based on a FY14E median EV/EBIT multiple of a European telco peer group (7x). The "Applications" segment we benchmark against a peer group of technology / cloud based businesses applying a FY14E median EV/EBITDA target multiple of 11x. We also add the value of United Internet's investments (e.g. SEDO, Versatel and European Founders Funds) to derive our target price. The main downside risks are (i) the failure of the group's expansion strategy into new markets, especially in the international roll-out of its hosting solutions and (ii) higher than expected price pressure in the German telecommunication market. Moreover, value-erosive M&A constitutes a risk. Next Financial Date United Internet will report Q1 results on 21 May. We will have management on a non-deal-road-show in London on 10 April and the company will present at Deutsche Bank’s Pan-European Small & Midcap Conference on 11 April.

Rating

Buy Europe Germany Technology IT Software & Services

Company

United Internet



52-week range (EUR) 19.42 - 12.58


8

12

16

20

4/10 10/10 4/11 10/11 4/12 10/12

United Internet



Absolute 3.1 12.5 33.3

DJ (.STOXXE) -3.4 -2.5 9.3


Market cap (EUR)(m) 3,597.0


Free float (%) 55

Option volume (und. shrs., 1M avg.) 8,112

9 April 2013



Model updated:08 April 2013


Germany

IT Software & Services

United Internet Reuters: UTDI.DE Bloomberg: UTDI GY



52 Week range EUR 12.58 - 19.42


USDm 4,679

Company Profile United Internet (UI) is a technology holding company offering telecommunication services in Germany under its 1&1 brand (DSL and mobile). In addition, UI is a leading Webhosting provider, operating globally. UI also runs two of the most successful general interest Internet portals in the German market (Web.de, GMX) and controls c. 50% of all email addresses in Germany. Lastly, the group made various investments in publicly listed and privately held companies.

Price Performance

8

12

16

20


United Internet DJ (.STOXXE) (Rebased)

Margin Trends

8

12

16

20

10 11 12 13E 14E 15E



010203040506070

0

5

10

15

20

10 11 12 13E 14E 15E


Solvency

0

10

20

30

40

-100

0

100

200

300

400

10 11 12 13E 14E 15E


Benjamin Kohnke +49 69 910-31943 [email protected]



Weighted average shares (m) 223 206 194 194 194 194Average market cap (EURm) 2,420 2,704 2,867 3,597 3,597 3,597Enterprise value (EURm) 2,473 3,037 2,973 3,543 3,361 3,141




Income Statement (EURm) Sales revenue 1,907 2,094 2,397 2,633 2,881 3,111Gross profit 747 789 901 985 1,091 1,182EBITDA 358 365 344 406 502 567Depreciation 66 71 79 79 84 86Amortisation 20 18 61 16 16 16EBIT 271 276 204 311 402 465Net interest income(expense) -10 -13 -10 -11 -12 -12Associates/affiliates -46 -13 -2 5 6 6Exceptionals/extraordinaries 2 0 0 0 0 0Other pre-tax income/(expense) 0 0 0 0 0 0Profit before tax 216 251 193 305 396 459Income tax expense 88 88 85 94 127 147Minorities 0 0 0 0 0 0Other post-tax income/(expense) 0 0 0 0 0 0Net profit 129 162 108 210 269 312

DB adjustments (including dilution) -2 1 46 0 0 0DB Net profit 127 163 154 210 269 312

Cash Flow (EURm) Cash flow from operations 290 195 261 285 335 381Net Capex -32 -36 15 -67 -78 -84Free cash flow 259 159 276 218 257 297Equity raised/(bought back) -118 -340 0 0 0 0Dividends paid -88 -42 -58 -59 -68 -74Net inc/(dec) in borrowings -31 155 -224 0 0 0Other investing/financing cash flows -42 37 -16 0 0 -1Net cash flow -21 -31 -22 160 189 222Change in working capital 52 -17 46 -23 -37 -35

Balance Sheet (EURm) Cash and other liquid assets 96 65 43 202 391 614Tangible fixed assets 109 111 109 122 139 161Goodwill/intangible assets 624 589 508 510 515 523Associates/investments 229 136 161 162 160 157Other assets 213 286 287 309 352 387Total assets 1,271 1,187 1,108 1,304 1,557 1,842Interest bearing debt 369 525 300 300 300 300Other liabilities 520 508 609 412 460 505Total liabilities 889 1,032 910 712 760 806Shareholders' equity 373 145 188 582 783 1,021Minorities 10 10 10 10 15 15Total shareholders' equity 382 155 198 592 798 1,036Net debt 273 460 257 98 -91 -314

Key Company Metrics Sales growth (%) 15.0 9.8 14.4 9.9 9.4 8.0DB EPS growth (%) -39.0 38.2 0.4 37.1 28.2 15.9EBITDA Margin (%) 18.8 17.4 14.3 15.4 17.4 18.2EBIT Margin (%) 14.2 13.2 8.5 11.8 14.0 14.9Payout ratio (%) 34.5 38.1 54.0 32.3 27.4 24.9ROE (%) 32.2 62.7 64.7 54.5 39.4 34.5Capex/sales (%) 3.8 2.6 2.7 2.7 2.7 2.7Capex/depreciation (x) 0.8 0.6 0.7 0.7 0.8 0.8Net debt/equity (%) 71.5 297.1 129.9 16.5 -11.4 -30.3Net interest cover (x) 26.9 22.1 20.9 28.8 34.7 37.5


9 April 2013



2.2 German SME sector focus: identifying the most relevant spots

In addition to our general investment themes outlined in detail above, we highlight key trends, Buy and Sell ideas across the most important sectors within German SMEs under Deutsche Bank coverage. Section 2.1 above presents the selected key picks in more detail.

Most of the German SME companies are concentrated in six sectors, i.e. Autos & Parts (page 34), Consumer/Retail (page 34), Mechanical Engineering (page 35), Pharma & HC/Biotech (page 36), Real Estate (page 37) and TMT (Technology, Media and Telcos) (pages 38-39). As single business cases may vary strongly from the rest of those companies in the same sector, we highlight the most important common drivers within each sector, analyse investor positioning and highlight key picks to help readers identify the most interesting themes and Buy ideas from a top-down perspective.

Automobiles & Parts: focus on suppliers geared into capacity expansion We expect around a 3% increase for global automotive sales this year with growth coming mainly from Asia and a solid US market. For Europe, we see sales declining by around 4%, with a weaker first half and some recovery from a lower base in H2. Most industry participants share the view that in light of ongoing macro difficulties, Europe might remain below its structural growth level for some time. As, in contrast to this, almost all OEMs follow a growth strategy, we expect the recent capacity expansion in emerging markets to continue. On the other hand, parts suppliers which are focused on Europe should continue to struggle with lower production rates. For 2014, we expect a somewhat better global sales development with 6% growth. We believe most parts suppliers will suffer from this development while those geared into capacity expansion provide better visibility on earnings in the coming quarters. Unlike for most parts suppliers, we even see the chance of earnings growth for some of these names. Outside the direct automotive world, we continue to dislike Delticom (DEXGn.DE) as we see the business struggling from a weak European replacement market/pricing and in particular from increased competition and price transparency. Given the above described trends, our favourite name in the sector remains Duerr (DUEG.DE) while we are neutral to negative on most part suppliers (see pages 22-23 for details).

Contact Jochen Gehrke ([email protected]) (+49-69-910-31949) and Tim Rokossa ([email protected]) (+49-69-910-31998) for details.

Figure 37: Sector positioning in Germany over time

(German Prime All Share Automobiles & Parts sector)

Figure 38: German SME companies under Deutsche Bank

coverage within the Automobiles & Parts sector

0.2

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1.2

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1.6

1.8

-0.60

-0.40

-0.20

0.00

0.20

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0.60

2008 2009 2010 2011 2012 2013

Sector weight* Prime Automobile rel. to Prime All Shares, x (rhs)

Mca

p

Pri

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TP

Up

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e

Company name Ticker Rec. (EUR m) (EUR) (EUR) (%)

Bertrandt AG BDTG.DE H 902 89.6 75.0 (16)Delticom AG DEXGn.DE S 432 36.5 28.0 (23)

Duerr DUEG.DE B 1,366 78.9 95.0 20

ElringKlinger AG ZILGn.DE H 1,425 22.5 21.0 (7)KUKA AG KU2G.DE H 1,055 31.1 30.0 (4)LEONI LEOGn.DE H 960 29.4 27.0 (8)Norma Group AG NOEJ.DE H 778 24.4 22.0 (10)Rheinmetall RHMG.DE S 1,340 35.3 31.0 (12)SAF Holland SA SFQN.DE H 262 5.8 5.0 (13)SHW SW1.DE B 197 33.7 34.0 1Sixt AG SIXG.DE H 745 15.5 16.0 3

Automobile & Parts (5)

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

9 April 2013



Consumer/Retail: prefer Consumer over Retail based on more attractive risk/reward German consumer and retail stocks in the small and mid-cap segment are on average highly reliant on their domestic market (German exposure for most stocks is >60% of sales). Consequently, private consumption in Germany is a major driver for the stocks in our universe. We expect unemployment to remain at a low level and household incomes to rise. Both effects result in an above-average consumer climate with recently improving trends. Consequently, we expect private consumption in Germany to increase by 0.6% yoy, one of the rare positive spots in Europe. Nevertheless, German retail market growth is typically in the low single-digits which is why companies need to outperform their respective retail markets on a like-for-like sales basis to profit from operating leverage and ignite investors’ interest. Furthermore, exogenous factors, such as weather conditions (in particular for textile and “do-it-yourself” (DIY) retailers) and unexpected shocks to disposable income can strongly influence these businesses. For that reason we prefer companies with self-help opportunities (e.g. restructuring at Praktiker and a shift to direct sourcing at Tom Tailor). Generally, we focus on stocks with strong earnings growth accompanied by low valuation, given attractive risk/reward.

Tom Tailor (TTIGn.DE) is our top pick in the German consumer/retail universe. The company continually outperforms the market with its Tom Tailor brand, due to rapidly improving brand awareness and offers turnaround potential for the acquired Bonita brand after the first positive integration effects become visible from H2-13 onwards. Additionally, a higher share of direct sourcing allows the company to improve its margins going forward, largely independent of market developments. All this comes at a below-sector 2013 PE of 11x (see pages 30-31 for details).

Contact Michael Kuhn ([email protected]) (+49-69-910-36642) and Benjamin Goy ([email protected]) (+49-69-910-31946) for details.


(German Prime All Share Consumer/Retail sector)


coverage within the Consumer/Retail sector

Consumer

0.2

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2008 2009 2010 2011 2012 2013Sector weight* Prime Consumer rel. to Prime All Shares, x (rhs)

Retail

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1.0

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0.70

2008 2009 2010 2011 2012 2013Sector weight* Prime Retail rel. to Prime All Shares, x (rhs)

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Up

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Fielmann FIEG.DE S 3,089 73.6 60.0 (18)Gerry Weber GWIG.DE B 1,453 31.7 40.0 26Hugo Boss BOSSn.DE B 6,032 87.4 96.0 10Kabel Deutschland KD8Gn.DE B 6,201 70.1 61.0 (13)PUMA SE PUMG.DE H 3,490 233.2 225.0 (3)Sky Deutschland SKYDn.DE H 3,439 4.0 4.5 13TUI AG TUIGn.DE B 1,985 7.9 10.3 31Air Berlin AB1.DE B 261 2.2 3.5 57Bijou Brigitte BIJG.DE H 589 74.7 66.0 (12)CEWE COLOR CWCG.DE B 214 32.8 38.0 16CTS Eventim AG EVDG.DE B 1,298 27.1 32.0 18Loewe AG LOEG.DE H 40 3.0 NA NA

Tom Tailor TTIGn.DE B 379 17.2 19.0 10

Villeroy & Boch VIBG_p.DE H 102 8.3 7.0 (15)Zooplus AG ZO1G.DE B 250 40.9 50.0 22

Consumer 3

BayWa BYWGnx.DE H 1,237 36.0 39.0 8Metro Group MEOG.DE H 7,193 22.0 23.0 4Hawesko HAWG.DE H 386 43.0 40.0 (7)Hornbach Holding HBHG_p.DE B 806 50.4 64.0 27Praktiker PRAG.DE B 131 1.1 2.6 126

Retail 8



9 April 2013



Mechanical Engineering: Heterogeneous sector, behaving surprisingly homogenously Our German SME engineering universe includes stocks that are quite heterogeneous in terms of products, business models and end-markets, but often behave in a surprisingly homogenous way. As such, the sector is cyclical and growth depends substantially on macro developments. We found that sector sales growth correlates strongly with German Industrial Production growth (R² of 90% with a gearing of slightly above 1x). Naturally, this relationship varies from company to company and we note that our coverage includes three longer cycle names [Vossloh (VOSG.DE), Schaltbau (SLTG.DE) and VTG (VT9G.DE)] which all have large railway exposure. In the short term, sector margin expansion is usually driven by revenue growth, given the high operational gearing of most companies, although long-term profitability has more subtle drivers such as competitive position, and regional and product mix, as well as cost inflation and productivity – in the end, however, it often boils down to pricing power.

The recent share rally suggests multiple expansion rather than recovery expectations: Given the cyclical nature and the high gearing of the capital goods companies, share prices often react to macroeconomic sentiment long before we see an actual operational impact. As such, news around the crisis in Europe had sent sector shares tumbling since Q3’11. However, operationally we have not seen a comparable downturn: indeed, most companies reached peak volumes in 2012. The strong sector rally over recent months thus seems to reflect de-risking and asset re-allocation rather than earnings recovery expectations implying sector multiple expansion.

2013 – Who can grow earnings in a low volume environment?: Macro indicators remain volatile, but most currently suggest only moderate developments for industrial production in Germany in 2013. This, in turn, suggests only modest volume growth for the sector. In such a low volume environment, operational gearing will lack its usual earnings driving power so that pricing power, product mix, regional exposure should return to investors’ focus. Regionally, we expect Europe to continue its subdued development in 2013/14, whereas China, the Americas should provide growth impulses (however, strongly varying across end-markets). We thus prefer names which can either outperform the market in Europe (given higher pricing /product mix) or have a strong standing in Americas/China with low margin dilution effects. We highlight Schaltbau AG (SLTG.DE) as our key pick in the sector (see pages 28-29 for details).

Contact Felicitas Bismarck ([email protected]) (+49-69-910-31975).


(German Prime All Share Industrial sector)


coverage within the Industrial sector

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

-0.60

-0.40

-0.20

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0.20

0.40

0.60

2008 2009 2010 2011 2012 2013

Sector weight* Prime Industrial rel. to Prime All Shares, x (rhs)

Mca

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Pri

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TP

Up

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e


Deutz AG DEZG.DE H 460 3.8 NA NAGEA G1AG.DE B 4,897 25.4 30.0 18Gildemeister AG GILG.DE H 903 15.0 NA NAHeidelberger Druck HDDG.DE B 382 1.6 2.5 52Jungheinrich JUNG_p.DE B 1,095 32.2 32.0 (1)Koenig & Bauer AG SKBG.DE H 295 17.9 12.0 (33)Krones KRNG.DE H 1,641 54.4 38.0 (30)MTU MTXGn.DE B 3,703 73.0 78.0 7Rational AG RAAG.DE H 2,591 227.9 NA NA

Schaltbau Holding SLTG.DE B 194 31.5 38.0 21

Vossloh VOSG.DE H 947 79.0 70.0 (11)VTG AG VT9G.DE B 284 13.3 14.0 5Wacker Neuson SE WACGn.DE H 788 11.2 10.0 (11)

Mechanical engineering 3* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations


9 April 2013



Pharma & HC/Biotech: intrinsic value and self-help/turnaround stories in focus German SME healthcare and biotech names feature distinct differences in business models and end-markets. Hence, in contrast to other sectors (that tend to feature greater similarities) indentifying major common trends appears more difficult. Nonetheless, we would highlight the following key themes:

(1) Sentiment looks positive: over the past few months, consensus earnings estimates have remained largely stable across the sector, whereas shares have moved up on average. Interestingly, we find that many of the names in this sector tend to trade at the upper end of (or even above) historical valuation corridors. Similarly, since the end of the Q3 2012 reporting season, multiples expansion in the sector has been more pronounced than for the broader market. In addition, positive/improving sentiment for small and midcap healthcare names is consistent with significant money inflows in the large cap healthcare space.

(2) Strong volatility around headlines: in the recent Q4/FY12 reporting season, shares in the German SME healthcare space reacted strongly to company news flow (and broker notes). For names where the market was concerned about weak results and/or disappointing outlook statements, we have seen fairly pronounced share price weakness into reportings. However, this was often more than offset by strength after reportings, which is surprising to the extent that often results and/or outlook statements were in fact mixed or even below market expectations. At least consistent with this trading pattern, shares in companies with strong results and/or positive outlook statements tended to trade strongly both ahead and after respective events.

(3) Intrinsic value and self-help/turnaround stories in focus: we believe investors continue to closely monitor the exposure of companies to government austerity and their ability to compensate for respective pressures. For example, a lot of time was recently spent on discussions around the medical device tax and sequestration in the US, while more generally, considerable focus is still put on the companies’ exposure and strategy in perceived low/high growth regions (e.g. Southern Europe and Emerging Markets). Accordingly, we continue to find particular interest from investors in those names that are either independent from government austerity or have structural growth/turnaround potential which goes beyond potential macro pressures.

MorphoSys (MORG.DE) is our key pick in the sector as we continue to see excellent risk/reward in the name with multiple sources for a re-rating (see pages 26-27 for details).

Contact Holger Blum ([email protected]) (+41-44-227-3376) and Gunnar Romer ([email protected]) (+49-69-910-31917) for details.


(German Prime All Share Pharma & Healthcare sector)


coverage within the Pharma & HC/Biotech sector

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

2008 2009 2010 2011 2012 2013

Sector weight* Prime Healthcare rel. to Prime All Shares, x (rhs)

Mca

p

Pri

ce

TP

Up

sid

e


Carl Zeiss Meditec AFXG.DE H 1,891 23.3 22.5 (3)Celesio CLSGn.DE H 2,517 14.8 13.5 (9)Draegerwerk AG DRWG_p.DE B 1,515 98.5 115.0 17Evotec EVTG.DE H 271 2.3 2.6 13Gerresheimer GXIG.DE H 1,354 43.1 43.0 (0)Morphosys MORG.DE B 714 31.0 43.0 39Qiagen* QGEN.OQ B 3,735 20.5 21.5 5Rhoen Klinikum RHKG.DE H 2,251 16.3 16.6 2Sartorius SATG_p.DE H 1,346 78.9 77.0 (2)Stada Arzneimittel AG STAGn.DE B 1,791 30.3 33.0 9Stratec SBSG.DE H 398 34.3 32.0 (7)

Pharma & HC/Biotech 3* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

*Price in USD. Note: The sector upside is based on market capitalisation weights. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations

9 April 2013



Real Estate: The seven-year itch We expect increased transaction activity in the residential property market over the coming two years, due to funds winding up and refinancing issues from investors who bought during the 2004-07 transaction boom. We anticipate that the listed space will likely benefit and find a number of EPS and NAV-accretive acquisition opportunities by having access to fresh equity and debt at attractive terms. We argue that GSW (GIBG.DE) and LEG (LEGn.DE) trading at +/-5% to spot NAV are cheap and should benefit from the current environment as the market is overlooking accretive acquisitions resulting in strong cash flow growth due to their funding benefit.

(1) Revival of the transaction market: large upcoming balloon repayments on the German CMBS maturity profile suggest that we are about to enter the 7th year since the 2004-07 transaction boom. In 2013, about E9bn in repayments become due. We anticipate a higher number of portfolio re-sales over the coming two years based in the winding up of funds due to misperception on returns in German property and their high LTVs (>70%) making refinancing or prolongation very difficult, sometimes impossible.

(2) A regulated refinancing environment does not benefit all business models: In the absence of large new CMBS issuance, we have seen a rebirth of the Mortgage Pfandbrief (covered bond) for mortgage loan refinancing over the past two years. We anticipate that a number of investors could find it difficult to adapt their business models from an unregulated to a strictly regulated refinancing channel (<60% LTV; conservative valuation approach). Owing to stricter bank regulation and rating downgrades, making unsecured funding disproportionally more expensive compared to secured debt, fulfilling the Mortgage Pfandbrief seems like the ‘only’ decently priced source of funding available, especially for large volumes (>E300m) over the past six months. Due to the scarcity of debt, we see hardly any funding available for >65% levered portfolios. The latter, especially, allows/has allowed the low levered (c.50% LTV) German property companies to pick up decently priced portfolios (initial yields between 7-8%) and refinance them at record cheap terms (2.8-3.5%).

(3) We expect strong dividend and NAV growth: following the deleveraging of the listed space over the past years, companies are now able to buy portfolios at higher yields than their current valuation and refinance at cheaper marginal than their current cost of debt. Finally, trading at NAV premiums could potentially result in the evolution of a virtuous circle, in which partly equity-funded acquisitions are accretive to EPS and NAV per share and the weight of acquisitions drives NAV up even higher resulting in strong share performance. LEG (LEGn.DE) is our preferred pick (see pages 24-25 for details).

Contact Markus Scheufler ([email protected]) (+44-20-754-18170) for details.


(German Prime All Share Financial Services sector)


coverage within the Real Estate/Financial Services sector

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

-0.80

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

0.80

2008 2009 2010 2011 2012 2013

Sector weight* Prime Financial services rel. to Prime All Shares, x (rhs)

Mca

p

Pri

ce

TP

Up

sid

e


Alstria AOXG.DE B 707 9.0 10.7 19Deutsche EuroShop DEQGn.DE H 1,659 30.8 33.0 7Deutsche Wohnen DWNG.DE H 2,184 13.6 15.5 14GAGFAH GFJG.DE H 1,765 9.0 8.0 (11)GSW GIBG.DE B 1,483 29.4 36.0 23

LEG LEGn.DE B 2,148 40.6 48.5 20

Prime Office PMOG.DE H 178 3.4 3.5 2

Real Estate/Financial Services 11



9 April 2013



TMT (Technology, Media and Telcos): Stock-picking remains essential By nature, the TMT sector is quite heterogeneous with regard to the respective business models and, consequently, the constituents’ growth and earnings profile in a given point of the economic cycle. This also holds for publicly-listed SMEs in the German market. Hence, this is a sector where stock-picking is of utmost importance, in our view.

(1) Telecommunications: for the telecommunication sub-sector we continue to see value in mobile service providers which we regard as defensive plays, given the highly-attractive dividend yields which are backed by a strong (and sustainable) free cash flow profile. Within this group, we prefer United Internet (UTDI.DE), which has the most promising growth strategy in place, in our view.

(2) Media: within the (scarce) media universe, we envisage low single-digit growth in the German TV-advertising market and rate ProSieben (PSMG_p.DE) Buy on accommodative valuation metrics.

(3) Software and Hardware: software-driven Internet-based business models like CTS Eventim (EVDG.DE), XING (OBCGn.DE) or TomorrowFocus (TFAG.DE) offer strong secular growth, which, however, comes at a price. We have high conviction that CTS Eventim will emerge as a winner from the current consolidation process in the ticketing industry, which we believe will move towards a global duopoly in the mid-term. In both hardware and software many names also act in different subsectors. Nevertheless, all are acting in the same environment. The key trends continue to be 1) the commoditisation of hardware and, somewhat related, 2) the emergence of cloud. The remedy against the ongoing commoditisation in hardware is mainly by increasing the software content and additional features [Wincor Nixdorf (WING.DE) and Dialog Semiconductor (DLGS.DE)] and works at most companies but there are noticeable exceptions [Kontron (KBCG.DE)]. Hardware sales of many former rising stars, such as the PC or storage, were down double-digits yoy in Q4 and many companies continue to wonder if this is already the ‘cloud’ impact. Either way, companies are taking a different approach. IT Service names like Cancom (COKG.DE) are very proactive and offer their own cloud solutions prominently in the market while Bechtle (BC8G.DE) is much more cautious in order not to lose too much traditional box-shifting business in the first place. Software names like Software AG (SOWG.DE) take a very agnostic stance and increasingly offer cloud solutions to the market and we expect further acquisitions (similar to Terracotta) at this end.

We highlight Compugroup Medical and United Internet as our key picks in this sector (see pages 20-21 and pages 32-33, respectively, for details).

Contact Benjamin Kohnke ([email protected]) (+49-69-910-31943), Johannes Schaller ([email protected]) (+49-69-910-31731) and Uwe Schupp ([email protected]) (+49-69-910-31955) for details.

9 April 2013




(German Prime All Share Technology sector)


coverage within the Technology sector

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

2008 2009 2010 2011 2012 2013

Sector weight* Prime Technology rel. to Prime All Shares, x (rhs)

Mca

p

Pri

ce

TP

Up

sid

e


ADVA ADAG.DE H 181 3.8 4.5 18AIXTRON AIXGn.DE B 1,126 11.2 14.0 25Dialog Semiconductor DLGS.DE H 687 10.6 15.0 42Elmos ELGG.DE H 155 8.0 7.4 (7)Euromicron EUCAn.DE H 102 15.4 17.0 11Gigaset AG GGS.DE H 46 0.9 1.2 32Jenoptik JENG.DE H 448 7.8 7.5 (4)Kontron AG KBCG.DE H 234 4.2 3.7 (12)Muehlbauer MUBG.DE H 133 21.7 21.0 (3)Pfeiffer Vacuum PV.DE S 846 85.7 69.0 (19)QSC AG QSCG.DE B 300 2.5 2.8 14ROFIN-SINAR RSTI.DE H 555 19.5 15.0 (23)SFC Energy AG F3CG.DE B 40 5.4 12.0 123Singulus Technologies SNGG.DE H 54 1.1 2.5 125Suess Microtec AG SMHNn.DE H 173 9.0 9.0 (0)Wincor Nixdorf WING.DE B 1,085 36.4 50.0 37

Technology 14* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Note: The sector upside is based on market capitalisation weights.

Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations


(German Prime All Share Software sector)


coverage within the Software sector

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

2008 2009 2010 2011 2012 2013

Sector weight* Prime Software rel. to Prime All Shares, x (rhs)

Mca

p

Pri

ce

TP

Up

sid

e


Bechtle BC8G.DE H 746 35.5 33.0 (7)Cancom COKG.DE H 171 15.0 13.0 (13)

Compugroup COPMa.DE B 853 17.0 23.0 35

PSI AG PSAGn.DE B 244 15.5 18.0 16Software AG SOWG.DE B 2,468 28.4 38.0 34Tomorrow Focus TFAG.DE H 222 4.2 4.0 (5)

United Internet UTDI.DE B 3,753 19.4 22.0 14

Wirecard WDIG.DE H 2,311 20.6 16.0 (22)XING AG OBCGn.DE H 224 40.8 50.0 23

Software 10

* Rolling Correlation (60 days) of Sector Excess returns versus German Funds Excess returns. Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations Note: The sector upside is based on market capitalisation weights.

Source: Bloomberg Finance LP, DataStream, Deutsche Bank calculations


(German Prime All Share Media sector)


coverage within the Media sector

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

2008 2009 2010 2011 2012 2013

Sector weight* Prime Media rel. to Prime All Shares, x (rhs)

Mca

p

Pri

ce

TP

Up

sid

e


Axel Springer SPRGn.DE H 3,365 34.1 42.0 23Constantin Medien AG EV4G.DE H 138 1.8 1.4 (21)CTS Eventim AG EVDG.DE B 1,298 27.1 32.0 18Kabel Deutschland KD8Gn.DE B 6,201 70.1 61.0 (13)ProSiebenSat.1 PSMG_p.DE B 5,794 27.0 29.0 7Sky Deutschland SKYDn.DE H 3,439 4.0 4.5 13Stroeer SAXG.DE B 370 7.9 12.5 57

Media 12



9 April 2013



2.3 Investable themes (top-down screenings)

We focus on key investable themes relevant to the international investor base looking at German SMEs with a focus on family businesses, exporters, momentum plays and regional exposure. We have also prepared screens that could be of special interest to conservative, style and income investors.

Overview

2.3.1 German SME family businesses (page 42) One of the most prominent themes among the German SME equity universe in the past has been the selection of “family businesses”. We recommend being selective and highlight CompuGroup, CTS Eventim, Draegerwerk, Duerr, Gerry Weber, Jungheinrich, QSC, SMA, Software AG, Tom Tailor and United Internet as our key picks in this basket.

2.3.2 German SME exporters (page 43) Next to the investment theme of “family businesses”, the screen of “exporters” among corporate Germany is one of the most frequently-requested ones. Fundamentally, we believe it is the one with the greatest upside from the current level and highlight Aixtron, GEA and MTU as key picks among German SME exporters.

2.3.3 Momentum plays (page 44) We screened the German SME universe for “Fallen Angels” (i.e. “out-of-favour stocks poised for a rebound” or buying opportunities) and “Falling Angels” (i.e. “out-of-favour consensus Buys” or selling opportunities). Based on this screening, we recommend owning Air Berlin, Heidelberger Druck and highlight Fielmann, Delticom as Sells.

2.3.4 Regional exposure (page 45) We sorted the German SME equity universe for the Top 20 companies with regional revenue exposure to Germany (home country), Europe ex Germany, Asia/Pacific, the Americas and calculated the historical performances of each basket relative to the German equity market to visualise revenue exposure-related trends.

2.3.5 Designed for conservative investors: High RoE vs. low volatility (page 47) Conservative investors could be interested in owning stocks that 1) offer a high return on equity, 2) are subject to low volatility and 3) can be bought at a reasonable price. In this regard, we highlight Duerr, Wincor Nixdorf, Gerry Weber, CompouGroup, CTS Eventim, United Internet and Hugo Boss as key picks.

2.3.6 Designed for style investors: “Value” vs. “Growth” (page 47) We screened the German SME universe for “Value” and “Growth” stocks and conclude that we prefer “Growth” over “Value” in the mid-term (>12 months forward) based on our analysts’ market cap weighted upside to their target prices. Buy-rated “Growth” stocks with significant upside to our analysts’ target prices include comdirect, MTU, ProSiebenSat.1, PSI AG and Software AG.

2.3.7 Designed for income investors: Dividend screens (page 49) We screened the German SME equity universe for two dividend themes, i.e. “sustainable dividends” and “current dividend yield attractiveness”. Within the “sustainable dividend” screen, Hugo Boss and ProSiebenSat.1 are the only Buy-rated stocks with significant upside to our analyst’s target prices. Among the “current dividend yield attractiveness” screen we highlight CEWE Color, CTS Eventim, Duerr, GEA, QSC and Wincor Nixdorf as key picks.

9 April 2013



2.3.1 German SME family businesses: a diverse universe demands a selective approach One of the most prominent themes within the German SME equity universe in the past has been the selection of “family businesses”. General pros attached to companies where shares are predominantly owned by family members or foundations under the influence of family members include 1) a high level of commitment by the founder family, 2) a long-term focus by company management, 3) an interest in conserving family patrimony and reputation and 4) optimal know-how transferred through generations (intimate knowledge of firm and market). On the other hand, cons include 1) a limited recruitment pool if positions are filled with family members (in other words, there may be better personnel available outside of the family), 2) difficulties finding a successor inside the family which may lead to a less reliable long-term commitment to continue the business and 3) possible conflicts between family members and difficulties agreeing on strategic targets. These frequently-debated pros and cons demand a selective approach when it comes to investing in family businesses – not only among German SMEs but among family businesses in general.

Reviewing the basket’s current status quo based on our analysts recommendations, we observe only 34% of the market cap is Buy-rated while c30% downside implied by our analysts’ target prices requires selective buying as suggested above. Our key picks among German SME family businesses with significant upside and an intact business case include CompuGroup, CTS Eventim, Draegerwerk, Duerr, Gerry Weber, Jungheinrich, QSC, SMA, Software AG, Tom Tailor and United Internet.

Figure 53: German small & mid cap “Family basket”

(basket constituents)

Figure 54: German small & mid cap “Family basket”

(rel. performance and DB recommendation weights)

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

EPS

Gro

wth

(%)

Div

yie

ld(%

)

Net

deb

t/Eq

uity

(%)

P/E

(x)

ADVA 3.8 4.5 H 18 (19) 0.0 (36) 11.7Axel Springer 34.1 42.0 H 23 (15) 5.0 8 13.4Bauer AG 18.9 20.0 H 6 31 2.4 124 9.8Bechtle 35.5 33.0 H (7) 15 2.9 (17) 11.3Carl Zeiss Meditec 23.3 22.5 H (3) 21 2.2 (35) 21.7Compugroup 17.0 23.0 B 35 11 3.1 84 11.3CTS Eventim AG 27.1 32.0 B 18 16 2.5 (39) 19.9Delticom AG 36.5 28.0 S (23) (3) 4.3 (35) 20.8Draegerwerk AG 98.5 115.0 B 17 13 1.0 2 12.2Duerr 78.9 95.0 B 20 19 3.4 (26) 10.3ElringKlinger AG 22.5 21.0 H (7) 13 2.4 35 14.7Fielmann 73.6 60.0 S (18) 2 3.6 (36) 23.9Fuchs Petrolub AG 64.7 46.0 H (29) 9 2.1 (29) 20.6Gerry Weber 31.7 40.0 B 26 16 2.8 (10) 15.9Jungheinrich 32.2 32.0 B (1) 9 2.9 (8) 9.5Krones 54.4 38.0 H (30) 7 1.4 (12) 17.5QSC AG 2.5 2.8 B 14 57 4.6 18 10.5Rational AG 227.9 na H na 11 3.3 (58) 24.2SMA 17.8 25.0 B 41 NA 0.3 (49) 0.0Software AG 28.4 38.0 B 34 12 1.8 (22) 10.6Solarworld AG 1.0 na H na 40 0.0 372 0.0Symrise 31 29 H (5) 13 2.4 36 17.6Tom Tailor 17 19 B 10 33 1.7 83 10.8United Internet 19 22 B 14 37 1.8 17 17.9Vossloh 79 70 H (11) (0) 2.5 44 18.2Wacker Chemie AG 53.7 37.0 S (31) 6 0.9 55 28.2Wacker Neuson SE 11.2 10.0 H (11) (5) 3.2 18 14.1

Family basket 1^ 14 2.4* 14 14.1*

2013EPrice & DB rec. 1) Relative performance versus PRIMALL

80

100

120

140

160

180

200

Mar

-08

Sep

-08

Mar

-09

Sep

-09

Mar

-10

Sep

-10

Mar

-11

Sep

-11

Mar

-12

Sep

-12

Mar

-13

Equal weight Mkt cap weight

2) DB recommendation weights (Mcap weighted)

34%

50%

16%

Buy (B)

Hold (H)

Sell (S)

* Median values, ^Market capitalisation weighted. Source: DataStream, Deutsche Bank estimates

Source: DataStream, Deutsche Bank estimates

9 April 2013



2.3.2 German SME exporters: Few strong opportunities among a well-known theme Next to the investment theme of “family businesses”, the screen of “exporters” among corporate Germany is one of the most frequently-requested ones. As a first step, we screened for stocks with a significant share of assets within Europe and at the same time a significant share of revenues outside of Europe (>30%) based on 2011 annual reports where data was available. We further conducted a qualitative review to filter for those names which actually pursue an export-oriented business model and excluded service-orientated names. Figure 55 presents our short-list of German SME exporters.

As in the case of family businesses (section 2.3.1 above), German SME exporters in aggregate outperformed German equity market (PRIMALL) during the early stage of the pre-crisis period. As we still see 2013 as a year of transition, with average growth in both advanced economies and emerging market economies returning to trend later this year and next, we remain positive on this theme in aggregate but see limited upside potential from here. As in the case of our family basket, we recommend selective buying and highlight Aixtron, GEA and MTU as our key picks among the German SME exporter screen with significant upside and an intact business case.

Figure 55: German small & mid cap “Exporter basket”

(basket constituents)

Figure 56: German small & mid cap “Exporter basket”

(re. basket performance relative to PRIMALL)

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

EPS

Gro

wth

(%)

Div

yie

ld(%

)

Net

deb

t/Eq

uity

(%)

P/E

(x)

ADVA 3.8 4.5 H 18 (19) 0.0 (36) 11.7

AIXTRON 11.2 14.0 B 25 92 0.0 (19) 0.0

Carl Zeiss Meditec 23.3 22.5 H (3) 21 2.2 (35) 21.7

GEA 25.4 30.0 B 18 3 2.6 6 10.8

Koenig & Bauer AG 17.9 12.0 H (33) 41 1.1 (14) 18.0

Kontron AG 4.2 3.7 H (12) NA 1.9 (3) 17.4

MTU 73.0 78.0 B 7 21 2.2 31 15.1

Pfeiffer Vacuum 85.7 69.0 S (19) (0) 3.9 (32) 16.8

Sartorius (Pref) 78.9 77.0 H (2) 13 1.4 62 18.9

Wacker Chemie AG 53.7 37.0 S (31) 6 0.9 55 28.2

Exporter basket 1^ 47 1.6* 18 17.1*

Price & DB rec. 2013E 1) Relative performance versus PRIMALL

708090

100110120130140150160170

Mar

-08

Sep

-08

Mar

-09

Sep

-09

Mar

-10

Sep

-10

Mar

-11

Sep

-11

Mar

-12

Sep

-12

Mar

-13

Equal weight Mkt cap weight

2) DB recommendation weights (Mcap weighted)

58%

20%

22%

Buy (B)

Hold (H)

Sell (S)

* Median values, ^Market capitalisation weighted. Source: DataStream, Deutsche Bank estimates

Source: DataStream, Deutsche Bank estimates

9 April 2013



2.3.3 Momentum plays: screening for “Fallen-/ and falling angels” We screened the German SME equity universe for stocks that out(under)performed the market (PRIMALL) significantly over the past 5 years (by at least 50%) and under(out)performed the market over the past 3 months (by at least 10%) to screen for momentum plays.

1) “Fallen Angels” (buying opportunities): In our “Fallen Angels” screen (i.e. “out-of-favour stocks poised for a rebound”) we prefer Buy-rated stocks under Deutsche Bank coverage. In this regard, we highlight Air Berlin and Heidelberger Druck, where we believe relative momentum could persist going forward.

1.1) Air Berlin (AB1.DE; Buy; target price: E3.5): We upgraded Air Berlin to Buy in February this year. Air Berlin has raised equity each year since its IPO in 2006 (with the exception of 2012, when it sold its frequent flyer programme to improve its equity). We think the Turbine restructuring programme that is now being implemented is the last chance for the company – and we think it will be a success. Over the upcoming quarters, we expect a gradual earnings improvement, bringing Air Berlin close to breakeven in FY13. We think investors will regain have confidence in Air Berlin’s future and that the stock should become appealing again for a broader range of market participants.

1.2) Heidelberger Druck (HDDG.DE; Buy; target price: E2.5): In May 2012, we upgraded Heidelberger Druck on back of signs of a industry-specific market recovery. After four years of net losses and four restructuring plans, we thought Heidelberger Druck might be starting to turn the corner. The latest plan was the first not to assume a market recovery and there are signs that the sheetfed equipment market had stabilised. The recent Q3 FY 2013 reporting brought the first operating profit after 14 consecutive quarters of losses, we observe cost reductions kicking in and a healthy backlog. We are increasingly optimistic that Heidelberg can become sustainably profitable, which is the key assumption of our Buy case.

2) “Falling Angels” (shorting opportunities): In our “Falling Angels” screen (i.e. “out-of-favour consensus Buys”) we prefer Sell-rated names under Deutsche Bank coverage. Although Delticom and Fielmann do not appear in this screen, we note that our analysts recently downgraded these names to Sell with significant downside to their target prices.

2.1) Delticom (DEXGn.DE; Sell; target price: E28.0): We downgraded Delticom in November 2012 as we believed the competition in Delticom's core market had increased significantly and that the company was forced to strongly incentivise sales at the expense of margins at that time. Structural concerns on the outperformance and profitability potential will continue to outweigh the opportunity of a technical bounce back. We continue to hold this view. For that, the valuation is too rich in our view at 20x 2013E earnings. Sell.

2.2) Fielmann (FIEG.DE; Sell; target price: E60.0): The current valuation levels do not reflect the weaker fundamental outlook for Fielmann, in our view. We forecast a slowdown in sales growth due to fewer store openings, rising online competition and structurally flat markets as well as no growth contribution from contact lenses. Simultaneously, we expect a continued increase in costs, mainly from higher personnel expenses. Both effects put pressure on EPS growth at a time when its premium valuation no longer offers margin for error. Sell.

9 April 2013



Figure 57: “Fallen angels” (out-of-favour and poised for a

rebound stocks; i.e. buying opportunities)

Figure 58: “Falling angels” (out-of-favour consensus

Buys; i.e. selling opportunities)

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

3M R

el. p

erf.

agan

ist

Prim

e A

ll (%

)

5Y R

el. p

erf.

agai

nst

Prim

e A

ll (%

)

Air Berlin 2.1 3.5 B 64 38 (86)

Celesio Ag 14.7 13.5 H (8) 11 (66)

Heidelberger Druck 1.6 2.5 B 61 20 (98)

Kloeckner & Co. 10.4 9.5 H (9) 12 (76)

Loewe 3.1 na H na 13 (88)

Nordex 5.0 3.0 H (40) 60 (95)

Stada Arzneimittel Ag 29.5 33.0 B 12 15 (51)

Price & DB rec. Relative performance

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

3M R

el. p

erf.

agan

ist

Prim

e A

ll (%

)

5Y R

el. p

erf.

agai

nst

Prim

e A

ll (%

)

Adva 3.8 4.5 H 19 (10) 55

Aurubis 46.3 58.0 H 25 (16) 64

Dialog Semiconductor Plc 10.9 15.0 H 38 (24) 722

Gerry Weber 32.4 40.0 B 23 (12) 171

Price & DB rec. Relative performance

Source: DataStream, Deutsche Bank calculations and estimates Source: DataStream, Deutsche Bank calculations and estimates

2.3.4 Regional exposure: sorting German SMEs for regional top-line exposure Companies publish regional revenue exposure based on individual reporting clusters. We aggregated revenues based on FY 2011 data for those categories with the most common overlays, i.e. home country (Germany), rest of Europe (Europe ex Germany), the Americas, Asia/Pacific and we declared the remaining share as “rest of world/unspecified”.

Based on these aggregations, we sorted the German SME equity universe for the Top 20 companies with revenue exposure to the respective clusters and calculated the historical performances of each basket relative to the German equity market to visualise revenue exposure related trends (compare Figure 59, Figure 60).

Figure 59: Regional performance baskets of German small

& mid caps versus Prime All Shares (equal weights)

Figure 60: Regional performance baskets of German small

& mid caps versus Prime All Shares (Mcap weights)

70

80

90

100

110

120

130

140

150

160

170

Mar

-08

Sep

-08

Mar

-09

Sep

-09

Mar

-10

Sep

-10

Mar

-11

Sep

-11

Mar

-12

Sep

-12

Mar

-13

Germany Europe Ex Germany Outside Europe Asia Americas

70

80

90

100

110

120

130

140

150

160

Mar

-08

Sep

-08

Mar

-09

Sep

-09

Mar

-10

Sep

-10

Mar

-11

Sep

-11

Mar

-12

Sep

-12

Mar

-13

Germany Europe Ex Germany Outside Europe Asia Americas

Source: DataStream, Deutsche Bank calculations Source: DataStream, Deutsche Bank calculations

Asia/Pacific exposure >25%: AIXTRON, Dialog Semiconductor, Wacker Chemie AG, Heidelberger Druck, Koenig & Bauer AG, SGL Group SE and Pfeiffer Vacuum.

Americas exposure >25%: MTU, Kontron AG, Carl Zeiss Meditec, Gerresheimer, PUMA SE, Kloeckner & Co., Symrise and Brenntag.

Europe (ex Germany) exposure >50%: Morphosys, Stada Arzneimittel AG, TUI AG, Jungheinrich, Deutz AG, Stratec, Rational AG, Tomorrow Focus and Celesio.

Germany >75%: (see Figure 61).

9 April 2013



Figure 61: “Domestic German exposure” (Top 20 stocks

with significant exposure to Germany, FY 2011)

Figure 62: “European exposure (ex GER)” (Top 20 stocks

with significant exposure to Europe ex GER, FY 2011)

Company Pric

e

Targ

et P

rice

Rec

.

Ups

ide

(%)

EPS

Δ (%

)

Div

. yie

ld (%

)

Net

deb

t/Eq

uity

(%)

P/E

(x)

Hom

e co

untr

y

Res

t of

Eur

ope

Am

eric

as

Asi

a/ P

acifi

c

RoW

Rhoen Klinikum 16.3 16.6 H 2 40 2.2 41 17.4 100 0 0 0 0

QSC AG 2.5 2.8 B 14 57 4.6 18 10.5 100 0 0 0 0

Freenet AG 18.4 17.0 B (8) (4) 6.5 31 10.1 100 0 0 0 0

Air Berlin 2.2 3.5 B 57 (9) 0.0 520 0.0 100 0 0 0 0

Tipp24 41.0 50.0 B 22 (38) 12.2 (106) 12.1 100 0 0 0 0

Alstria 9.0 10.7 B 19 18 6.5 96 13.8 100 0 0 0 0

Deutsche Wohnen 13.6 15.5 H 14 29 2.5 141 20.2 100 0 0 0 0

GSW 29.4 36.0 B 23 25 3.5 117 18.4 100 0 0 0 0

Prime Office 3.4 3.5 H 2 (97) 2.0 139 357.6 100 0 0 0 0

Bertrandt AG 89.6 75.0 H (16) 9 2.5 (14) 16.0 93 na na na 7

XING AG 40.8 50.0 H 23 9 1.6 (106) 21.0 90 10 0 0 0

United Internet 19.4 22.0 B 14 37 1.8 17 17.9 90 na na na 10

Deutsche EuroShop 30.8 33.0 H 7 20 4.1 113 15.2 88 na na na 12

Singulus Technologies 1.1 2.5 H na 50 0.0 (43) 54.3 87 3 7 3 0

Hawesko 43.0 40.0 H (7) 27 3.8 (2) 19.6 86 12 na na 2

Fraport AG 43.3 52.0 B 20 (2) 2.9 128 17.2 82 4 na 7 7

HHLA 16.9 17.0 H 1 (21) 3.3 37 22.3 80 16 na na 4

PSI AG 15.5 18.0 B 16 34 2.7 (41) 19.7 79 na na na 21

Fielmann 73.6 60.0 S (18) 2 3.6 (36) 23.9 79 21 0 0 0

CTS Eventim AG 27.1 32.0 B 18 16 2.5 (39) 19.9 77 19 na na 4

% of sales 2011Price & Rec. 2013E Revenue exposure

Company Pric

e

Targ

et P

rice

Rec

.

Ups

ide

(%)

EPS

Δ (%

)

Div

. yie

ld (%

)N

et d

ebt/

Equi

ty (%

)

P/E

(x)

Hom

e co

untr

y

Res

t of

Eur

ope

Am

eric

as

Asi

a/ P

acifi

c

RoW

Morphosys 31.0 43.0 B 39 NA 0.0 (33) 0.0 4 81 12 3 0

Stada Arzneimittel AG 30.3 33.0 B 9 16 1.7 102 10.6 28 68 na na 4

TUI AG 7.9 10.3 B 31 (13) 0.0 0 nm 27 66 4 na 2

Jungheinrich 32.2 32.0 B (1) 9 2.9 (8) 9.5 27 66 na na 7

Deutz AG 3.8 na H na 53 0.0 21 12.3 18 56 12 8 6

Stratec 34.3 32.0 H (7) 29 2.0 (26) 21.0 18 54 na na 29

Rational AG 227.9 na H na 11 3.3 (58) 24.2 15 51 15 13 6

Tomorrow Focus 4.2 4.0 H (5) 16 1.9 12 13.5 50 50 0 0 0

Celesio 14.8 13.5 H (9) 5 2.6 57 11.6 19 50 na na 31

Aurubis 46.5 58.0 H 25 7 3.0 9 9.5 35 49 6 7 3

Vossloh 79.0 70.0 H (11) (0) 2.5 44 18.2 22 48 9 18 3

Wincor Nixdorf 36.4 50.0 B 37 36 3.9 27 12.7 26 48 10 16 0

Kloeckner & Co. 10.2 9.5 H (7) NA 0.0 27 109.7 24 46 29 0 1

GfK 40.2 39.5 H (2) 7 2.0 30 14.3 27 45 19 9 0

LEONI 29.4 27.0 H (8) (37) 3.1 27 9.8 29 42 na na 29

Bilfinger SE 78.4 82.0 H 5 9 3.8 (12) 12.5 40 41 8 5 7

Gerresheimer 43.1 43.0 H (0) 9 1.6 54 15.5 23 39 31 3 3

ADVA 3.8 4.5 H 18 (19) 0.0 (36) 11.7 26 39 30 5 0

Draegerwerk AG 87.5 115.0 B 31 13 1.0 2 12.2 20 38 20 15 6

Wirecard 20.6 16.0 H (22) 15 0.6 (18) 26.5 54 38 na na 7

Price & Rec.% of sales 2011

2013E Revenue exposure

Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012. Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012.

Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates

Figure 63: “Asia/Pacific exposure” (Top 20 stocks with

significant exposure to Asia/Pacific, FY 2011)

Figure 64: “Americas exposure” (Top 20 stocks with

significant exposure to the Americas, FY 2011)

Company Pric

e

Targ

et P

rice

Rec

.

Ups

ide

(%)

EPS

Δ (%

)

Div

. yie

ld (%

)

Net

deb

t/Eq

uity

(%)

P/E

(x)

Hom

e co

untr

y

Res

t of

Eur

ope

Am

eric

as

Asi

a/ P

acifi

c

RoW

AIXTRON 11.3 14.0 B 24 92 0.0 (19) 0.0 2 3 6 90 0

Dialog Semiconductor 10.9 15.0 H 38 33 0.0 (45) 11.3 na 16 na 80 4

Wacker Chemie AG 55.3 37.0 S (33) 6 0.9 55 28.2 18 24 17 37 3

Heidelberger Druck 1.6 2.5 B 61 85 0.0 70 0.0 15 35 18 33 0

Koenig & Bauer AG 17.0 12.0 H (30) 41 1.1 (14) 18.0 16 36 9 27 13

SGL Group SE 30.3 30.0 H (1) (7) 0.8 37 46.7 19 25 23 26 8

Pfeiffer Vacuum 84.5 69.0 S (18) (0) 3.9 (32) 16.8 28 28 19 26 0

Sartorius (Pref) 77.6 77.0 H (1) 13 1.4 62 18.9 17 35 21 23 4

PUMA SE 231.9 225.0 H (3) 13 0.8 (26) 15.9 na 41 30 22 6

Symrise 30.6 29.0 H (5) 13 2.4 36 17.6 na 49 29 22 0

GEA 25.6 30.0 B 17 3 2.6 6 10.8 11 36 20 22 11

Bauer AG 18.9 20.0 H 6 31 2.4 124 9.8 27 20 14 21 18

Gildemeister AG 15.0 na H na 6 2.5 (13) 10.8 38 29 6 19 9

Vossloh 79.0 70.0 H (11) (0) 2.5 44 18.2 22 48 9 18 3

Wincor Nixdorf 36.7 50.0 B 36 36 3.9 27 12.7 26 48 10 16 0

Draegerwerk AG 86.3 115.0 B 33 13 1.0 2 12.2 20 38 20 15 6

Carl Zeiss Meditec 23.1 22.5 H (2) 21 2.2 (35) 21.7 43 11 32 14 0

ElringKlinger AG 22.6 21.0 H (7) 13 2.4 35 14.7 31 33 16 14 6

Rational AG 229.3 na H na 11 3.3 (58) 24.2 15 51 15 13 6

Jenoptik 7.9 7.5 H (5) 5 2.3 15 11.0 41 31 13 11 4

Price & Rec.% of sales 2011

2013E Revenue exposure

Company Pric

e

Targ

et P

rice

Rec

.

Ups

ide

(%)

EPS

Δ (%

)

Div

. yie

ld (%

)

Net

deb

t/Eq

uity

(%)

P/E

(x)

Hom

e co

untr

y

Res

t of

Eur

ope

Am

eric

as

Asi

a/ P

acifi

c

RoW

MTU 71.7 78.0 B 9 21 2.2 31 15.1 15 10 68 7 0

Kontron AG 4.3 3.7 H (14) NA 1.9 (3) 17.4 na 44 38 na 18

Carl Zeiss Meditec 23.1 22.5 H (2) 21 2.2 (35) 21.7 43 11 32 14 0

Gerresheimer 42.9 43.0 H 0 9 1.6 54 15.5 23 39 31 3 3

PUMA SE 231.9 225.0 H (3) 13 0.8 (26) 15.9 na 41 30 22 6

Kloeckner & Co. 10.4 9.5 H (9) NA 0.0 27 109.7 24 46 29 0 1

Symrise 30.6 29.0 H (5) 13 2.4 36 17.6 na 49 29 22 0

Software AG 27.9 38.0 B 36 12 1.8 (22) 10.6 21 na 23 na 55

SGL Group SE 30.3 30.0 H (1) (7) 0.8 37 46.7 19 25 23 26 8

Duerr 78.6 95.0 B 21 19 3.4 (26) 10.3 15 25 22 na 38

Solarworld AG 0.9 na H na 40 0.0 372 0.0 42 18 21 11 8

Sartorius (Pref) 77.6 77.0 H (1) 13 1.4 62 18.9 17 35 21 23 4

Nordex 5.0 3.0 H (40) NA 0.0 19 100.4 na 75 21 4 0

GEA 25.6 30.0 B 17 3 2.6 6 10.8 11 36 20 22 11

Draegerwerk AG 86.3 115.0 B 33 13 1.0 2 12.2 20 38 20 15 6

KUKA AG 31.1 30.0 H (4) 26 2.0 (26) 15.0 35 23 19 na 23

Pfeiffer Vacuum 84.5 69.0 S (18) (0) 3.9 (32) 16.8 28 28 19 26 0

Heidelberger Druck 1.6 2.5 B 61 85 0.0 70 0.0 15 35 18 33 0

ElringKlinger AG 22.6 21.0 H (7) 13 2.4 35 14.7 31 33 16 14 6

Jenoptik 7.9 7.5 H (5) 5 2.3 15 11.0 41 31 13 11 4

Price & Rec. 2013E Revenue exposure% of sales 2011

Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012. Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates Note: FY 2011 covers companies reporting between 01/04/2011 to 31/03/2012.

Source: Bloomberg Finance LP, Factset, DataStream, company data, Deutsche Bank estimates

9 April 2013



2.3.5 Designed for conservative investors: high RoE vs. (low market vol/PB ratio) + yield Conservative investors could be interested in owning stocks that 1) offer a high return on equity (RoE), 2) are subject to low volatility and 3) can be bought at a reasonable price (here, we chose the price-to-book value ratio as a screening criteria instead of the price-to-earnings ratio as the book value of equity is a much more stable variable compared to earnings over time).

Therefore, we sorted the German SME equity universe for the ratio of RoE relative to volume on a three-year historic period based on a 12-month forward basis (8/12 of 2013E and 4/12 of 2014E). Based on this ratio, we display the 50 most attractive names in a scatter plot (see Figure 66). Among those 50 names, we prefer Buy-rated stocks that can be bought at relatively low P/B ratio (see Figure 65).

In this regard, our key picks include Duerr, Wincor Nixdorf, Gerry Weber, CompouGroup, CTS Eventim, United Internet and Hugo Boss.

Figure 65: “Conservative plays” screening Figure 66: “Conservative plays” (recommendations)

y = 0.6141x + 1.6594

0

10

20

30

40

50

60

70

12.0 17.0 22.0 27.0 32.0 37.0 42.0 47.0 52.0

Ret

urn

on

Eq

uity

(R

oE

) 12

m f

wd

Volatility (3-years history)

Superior RoE-to-vol profile

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

P/B

V (x

)

RoE

(%)

Vol

(%)

RoE

/vol

(x)

Div

Yie

ld (%

)

Suedzucker 32.3 31.0 H (4) 1.6 14 20 0.7 3.3

Gerresheimer 43.1 43.0 H (0) 2.2 14 20 0.7 1.7

Duerr 78.9 95.0 B 20 2.2 23 34 0.7 3.5

Takkt 12.9 12.0 H (7) 2.2 20 24 0.9 2.7

Wincor Nixdorf 36.4 50.0 B 37 2.6 24 24 1.0 4.3

Kuka Ag 31.1 30.0 H (4) 2.6 20 27 0.7 2.0

Constantin Medien 1.8 1.4 H (21) 2.9 30 29 1.0 0.0

Gerry Weber 31.7 40.0 B 26 3.3 23 26 0.9 2.9

Symrise 30.6 29.0 H (5) 3.6 19 24 0.8 2.5

Bertrandt 89.6 75.0 H (16) 3.6 25 34 0.7 1.7

Xing 40.8 50.0 H 23 3.6 20 28 0.7 1.6

Compugroup Medical 17.0 23.0 B 35 3.7 25 36 0.7 3.3

Hawesko 43.0 40.0 H (7) 4.3 23 20 1.2 3.9

Cts Eventim 27.1 32.0 B 18 5.1 29 31 0.9 2.6

Fielmann 73.6 60.0 S (18) 5.2 22 17 1.3 3.6

Fuchs Petrolub 64.7 46.0 H (29) 5.3 28 32 0.9 2.2

Delticom 36.5 28.0 S (23) 6.6 36 31 1.2 4.8

United Internet 19.4 22.0 B 14 7.3 49.4 32.2 1.5 1.9

Hugo Boss 87.4 96.0 B 10 7.9 49.5 37.0 1.3 4.1

Price & DB rec. 12-months forward


2.3.6 Designed for style investors: “Value” vs. “Growth” – O/w “Growth” going forward We screened the German SME equity universe for “Growth” and “Value” stocks to provide style-based investors with an overview about how the themes have performed in Germany as well as in Europe and where we see the strongest upside from the current levels. As a starting point, we review German and European “Growth” versus “Value” performance based on MSCI methodology. MSCI uses eight historical and forward looking variables (three for value and five for growth) to classify securities under “Value” or “Growth” indices. Stocks are identified as “Value” based on a low P/B and 12-month forward P/E ratio and a high dividend yield. By contrast, “Growth” stocks are characterised by a high short-/ and long-term forward EPS growth rate, a high current internal growth rate, a high long-term historical EPS growth trend and a high long-term historical sales per share growth trend.

9 April 2013



Figure 67: MSCI “Growth” over “Value” in Germany and

Europe (net return indices)

Figure 68: MSCI “Growth” Germany over Europe and

MSCI “Value” Germany over Europe (net return indices)

-70%-60%-50%-40%-30%-20%-10%

0%10%20%30%

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

2011

2013

"Growth"/"Value" Germany "Growth"/"Value" Europe

-80%

-70%

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

2011

2013

Germany/Europe "Growth" Germany/Europe "Value"

Source: DataStream, Deutsche Bank calculations Source: DataStream, Deutsche Bank calculations

Reviewing the long-term performance of “Value” vs. “Growth” in the German equity universe reveals “Growth” stocks recorded only two periods of relative outperformance versus “Value” stocks, i.e. in the 1980s (1980–87) and the late 2000s (2008-recent). Over the long run, however, “Value” stocks prevailed. The same holds true for “Growth” over “Value” in the European equity universe with the difference that the period from 2008 until recent marked the only period greater than five years with ongoing underperformance relative to “Growth” stocks (Figure 67). Plotting “German Growth(/Value) stocks” against “European Growth(/Value) stocks” indicates European aggregates dominated from the mid-1970s up until the early 2000s. Only after the new economy bubble had burst did German aggregates manage to gain ground again (Figure 68). To help investors identify “Value” and “Growth” stocks among German SMEs, we screened our universe under Deutsche Bank coverage for typical criteria:

“Value” stocks: Low P/BV, low PE (forward & trailing) and high dividend yield relative to the median value among German stocks under Deutsche Bank coverage.

“Growth” stocks: High long-term EPS growth, high five-year sales growth, high five-year EPS growth and high RoE relative to median value among German stocks under Deutsche Bank coverage.

Based on our analysts (market capitalisation weighted) recommendation, we prefer the identified “Growth” over “Value” stocks in aggregate (see Figure 71 and Figure 72).

Figure 69: “Value screen” among German SMEs

(constituents)

Figure 70: “Growth screen” among German SMEs

(constituents)

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

Ups

ide(

%)

12m

Fwd

PE

(x)

12m

Tra

iling

PE

(x)

12m

Tra

iling

DY

(%)

Pric

e to

Boo

k (x

)

Aurubis 46.3 58.0 H 25 9.2 12.7 2.9 1.0Bauer AG 18.9 20.0 H 6 8.4 6.0 2.6 0.7C.A.T. oil 8.0 9.5 B 19 11.3 4.2 1.6 1.8Celesio 14.7 13.5 H (8) 11.1 1.5 2.0 1.0DAB bank 3.6 3.5 H (1) 16.0 9.8 5.9 1.3Deutsche EuroShop 30.8 33.0 H 7 16.2 8.6 3.6 1.3Elmos 8.1 7.4 H (9) 12.7 4.2 3.1 0.8Jenoptik 7.9 7.5 H (5) 11.4 16.2 2.3 1.4Sixt AG 15.5 16.0 H 3 8.6 15.6 6.5 1.3VTG AG 13.4 14.0 B 5 13.2 1.7 2.8 0.9

Price & DB rec. "Value" metrics

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

Ups

ide(

%)

RO

E C

urre

nt (%

)

5Y E

PS g

row

th (%

)

5Y s

ales

gro

wth

(%)

LT E

PS g

row

th (%

)

Carl Zeiss Meditec 23.1 22.5 H (2) 12.9 11.7 14.2 13.3comdirect 8.0 9.0 B 12 19.9 7.2 13.4 6.1ElringKlinger AG 22.6 21.0 H (7) 15.6 15.3 14.3 7.9Hawesko 43.0 40.0 H (7) 18.5 8.7 6.3 6.6MTU 71.7 78.0 B 9 18.5 10.7 3.9 14.6ProSiebenSat.1 26.2 29.0 B 11 20.5 5.9 5.5 9.0PSI AG 15.4 18.0 B 17 13.4 13.2 7.7 22.0Software AG 27.9 38.0 B 36 18.2 12.1 17.9 6.6Stratec 33.8 32.0 H (5) 20.3 19.0 11.2 13.8Symrise 30.6 29.0 H (5) 17.2 19.2 5.2 9.8

Price & DB rec. "Growth" metrics


9 April 2013



Figure 71: “Value screen” among German SMEs Figure 72: “Growth screen” among German SMEs

5%

95%

0%

Buy (B)

Hold (H)

Sell (S)

74%

26%

0%

Buy (B)

Hold (H)

Sell (S)


2.3.7 Designed for income investors: German small & mid cap dividend screens We screened the German SME equity universe for two dividend themes:

Sustainable dividend screen (see Figure 73): Investors that are more conservative in nature with a mid-/ to long-term investment horizon should be interested in screening for those names that have produced a stable and growing DPS profile over the past years and where our analysts expect this trend to continue in 2013/14. Hugo Boss and ProSiebenSat.1 are the only Buy-rated stocks with significant upside potential to our analyst’s target prices.

Current yield attractiveness (see Figure 74): Investors interested in owning stocks offering short-term dividend attractiveness should screen for those names with a high dividend yield accompanied by a high dividend cover ratio (FCF per share/DPS), low leverage (net debt/equity) and, most importantly, a solid view on (at least) stable EPS. Stocks offering a high dividend yield but a bleak outlook on growth prospects will not attract investor interest for obvious reasons. According to our screening, we highlight CEWE Color, CTS Eventim, Duerr, GEA, QSC and Wincor Nixdorf as attractive current dividend plays.

Figure 73: “Sustainable dividends” Figure 74: “Current yield attractiveness”

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

DPS

CA

GR

%

(200

5-14

E)

Div

. yie

ld (%

)

Div

cov

er (x

)

Payo

ut R

atio

(%)

Stratec 33.8 32.0 H (5) 34 2.0 1.9 42Pfeiffer Vacuum 84.5 69.0 S (18) 25 3.9 2.3 75Fuchs Petrolub AG 64.1 46.0 H (28) 24 2.1 1.6 43ProSiebenSat.1 26.2 29.0 B 11 19 5.5 4.8 80BayWa 36.2 39.0 H 8 17 3.1 5.2 41Hugo Boss 86.7 96.0 B 11 17 4.0 1.2 70GfK 40.3 39.5 H (2) 15 2.0 3.9 32Fielmann 73.2 60.0 S (18) 13 3.6 1.2 85Hawesko 43.0 40.0 H (7) 13 3.8 1.1 74Rhoen Klinikum 16.1 16.6 H 3 12 2.2 3.3 39Sartorius (Pref) 77.6 77.0 H (1) 11 1.4 3.0 31Krones 54.2 38.0 H (30) 10 1.4 0.2 25GRENKE Group 56.4 47.0 H (17) 10 1.6 0.8 28ElringKlinger AG 22.6 21.0 H (7) 9 2.4 1.4 35Aurubis 46.3 58.0 H 25 8 3.0 -0.6 49

Price & DB rec. 2013E

Company Pric

e (E

UR

)

TP (E

UR

)

Rec

.

Ups

ide

(%)

Div

. yie

ld (%

)

Net

deb

t/EB

ITD

A (%

)

Inte

rest

cov

er (x

)

Div

. cov

er (

x)

Pauo

ut R

atio

(%)

Axel Springer 34.1 42.0 H 23 5.0 0.3 16.2 2.0 67CEWE COLOR 32.8 38.0 B 16 4.6 0.2 21.7 2.6 50CTS Eventim AG 27.1 32.0 B 18 2.5 -0.8 25.0 2.9 50Duerr 78.9 95.0 B 20 3.4 -0.7 8.8 2.6 35GEA 25.4 30.0 B 18 2.6 0.2 8.4 3.3 30QSC AG 2.5 2.8 B 14 4.6 0.4 9.6 1.9 53Wincor Nixdorf 36.4 50.0 B 37 3.9 0.6 16.3 2.3 50

Price & DB rec. 2013E


9 April 2013



Appendix A

Market data chart book

Overview

A.1 Key economic indicators (page 51) This section provides investors with an overview of current Deutsche Bank forecasts related to 1) economic growth, consumer prices, current accounts, fiscal balances across regions, 2) forecasts related to FX targets, 3) commodity prices and 4) rates.

A.2 Performance (page 52) This section reviews performance across regions, Prime All Share sectors and identifies German SMEs with the greatest 2013 year-to-date out-/ and underperformance.

A.3 Earnings (page 53) This section presents an overview of latest changes to recommendations, target prices and EPS estimates among Deutsche Bank analysts for German SMEs.

A.4 Consensus recommendation momentum (page 54) In addition to earnings, IBES collects data on ratings and calculates a consensus rating for each company on a scale from 1 to 5 (1 is a strong buy and 5 is a sell). It is especially interesting to look at companies that are among the least (most) preferred and where the recommendation momentum starts to improve (deteriorate). Momentum could flag a change in awareness of the company in the market.

A.5 Directors’ Dealings (page 55) This section monitors Directors' Dealings among German SMEs. Empirical analyses suggest that investors can benefit by mimicking buy transactions in particular.

A.6 Traditional valuation (page 56) This section presents valuation screens sorting German SMEs for lowest P/E, lowest/highest P/B, lowest/highest EV/EBITDA ratios and highest dividend yield.

A.7 Index agglomerations (page 58) We aggregated German as well as European (ex Germany) SME companies (ex-financials) below a market capitalisation of E5bn following the “one-company-approach” to compare metrics across P&L, B/S and CFS statements. Key ratios summarise the most important variables.

9 April 2013



A.1 Key economic indicators

Economic growth, consumer prices, current account and fiscal balances

Real GDP Consumer Prices Current Account Fiscal Balance % growth % growth % of GDP % of GDP 2012E 2013E 2014E 2012E 2013E 2014E 2012E 2013E 2014E 2012E 2013E 2014E

Global 2.9 3.2 4.0 3.3 3.3 3.6 G7 1.4 1.3 2.2 1.9 1.8 2.3 US 2.2 2.3 3.2 2.1 2.3 2.6 -3.0 -3.1 -3.4 -6.8 -6.3 -5.3Japan 2.0 1.4 0.6 0.0 0.0 2.0 1.0 1.2 2.3 -9.6 -9.4 -7.4Euroland -0.6 -0.6 1.0 2.5 1.6 1.6 1.2 1.7 1.6 -3.2 -3.0 -2.6Germany 0.7 0.3 1.5 2.1 1.7 1.8 7.0 6.3 6.1 0.2 -0.4 -0.2France 0.0 -0.6 1.1 2.2 1.4 1.5 -2.4 -2.2 -1.9 -4.6 -3.8 -3.2Italy -2.4 -1.8 0.4 3.3 1.8 1.6 -0.6 0.4 0.4 -3.0 -2.6 -2.8UK 0.3 0.5 1.8 2.8 3.0 2.6 -3.7 -3.1 -2.5 -7.8 -7.1 -6.4Latin America 5.9 6.8 7.5 3.8 3.9 4.2 1.4 0.9 0.6 -2.8 -3.0 -2.5EEMEA 2.8 3.5 4.0 7.8 8.3 8.2 -1.3 -1.4 -1.6 -2.6 -2.3 -1.9Source: Bloomberg Finance LP, Deutsche Bank Global Markets Research

Deutsche Bank quarterly GDP growth forecasts

GDP growth (% qoq saar / annual: % yoy Q1 12 Q2 12 Q3 12 Q4 12 2012E Q1 13E Q2 13E Q3 13E Q4 13E 2013E 2014EG7 1.9 0.3 1.3 -0.5 1.4 1.8 1.8 2.2 2.5 1.3 2.2US 2.0 1.3 3.1 0.4 2.2 3.0 2.3 3.0 3.5 2.3 3.2Japan 6.1 -0.9 -3.7 0.2 2.0 3.1 3.4 2.6 2.5 1.4 0.6Euroland 0.2 -0.7 -0.3 -2.3 -0.6 -1.0 0.0 0.7 0.8 -0.6 1.0Germany 2.0 1.1 0.9 -2.4 0.7 0.6 1.5 1.7 1.0 0.3 1.5France 0.2 -0.4 0.7 -1.2 0.0 -1.3 -0.5 0.2 0.7 -0.6 1.1Italy 3.7 -3.0 -0.8 -3.7 -2.4 -2.3 -1.2 0.0 0.4 -1.8 0.4UK 0.3 -1.5 3.8 -1.2 0.3 -0.2 0.6 1.0 1.5 0.5 1.8

Deutsche Bank FX forecasts

End period Current 05/04/2013 Dec-12 Mar-13 Jun-13E Sep-13E Dec-13E

EUR/USD 1.30 1.29 1.28 1.26 1.23 1.20USD/JPY 97 78 94 96 98 100EUR/JPY 127 100 121 121 121 120GBP/USD 1.54 1.61 1.52 1.45 1.43 1.41EUR/GBP 0.85 0.80 0.85 0.87 0.86 0.85Source: National Statistics Offices, Bloomberg Finance LP, Deutsche Bank Global Markets Research

Deutsche Bank Commodity forecasts

End period Current units 05/04/13 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Brent Oil USD/bbl 104.8 109.6 112.0 115.0 115.0 110.0 112.0 115.0 116.0Aluminium USD/tn 1851 1875 2250 2150 2000 2200 2200 2200 2200Copper USD/tn 7377 7510 8500 8000 7800 7500 7500 7500 7500Gold USD/oz 1566 1596 1825 1875 2000 1950 1900 1900 1850Source: National Statistics Offices, Bloomberg Finance LP, Deutsche Bank Global Markets Research

Deutsche Bank Fixed Income forecasts

3-month interest rates 10-year government bond yieldEnd period (in %) Current Current

05/04/2013 Jun-13 Sep-13 Mar-14 05/04/2013 Jun-13 Sep-13 Mar-14US 0.28 0.35 0.35 0.35 1.69 2.35 2.50 3.00Japan 0.25 0.30 0.30 0.30 0.53 0.70 0.80 0.90Euroland 0.21 0.25 0.25 0.35 1.22 1.65 1.75 2.00UK 0.50 0.51 0.52 0.60 1.65 2.25 2.45 2.90

Source: National Statistics Offices, Bloomberg Finance LP, Deutsche Bank Global Markets Research

9 April 2013



A.2 Performance

This section reviews performance across regions, Prime All Share sectors and identifies German SMEs with the greatest 2013 year-to-date out-/ and underperformance.

Figure 75: 1M vs. 3M performance (regions) Figure 76: 1M vs. 3M performance (Prime sectors)

-3.9%

-3.5%

-3.1%

-2.7%

-2.6%

-2.5%

-2.3%

-2.0%

-1.1%

-0.3%

0.2%

0.3%

0.7%

1.1%

8.8%

-10% -5% 0% 5% 10% 15% 20% 25%

MSCI EMEA

Eurostoxx 50

CAC 40

HDAX

TECDAX

MSCI AC Asia-ex-Japan

FTSE 100

Stoxx 600

Stoxx 50

DAX 30

MDAX

MSCI World

SDAX

S&P 500

TOPIX1M

3M

-13.5%

-12.8%

-8.8%

-6.0%

-5.4%

-4.9%

-4.8%

-4.0%

-3.1%

-2.7%

-2.3%

-2.0%

-1.7%

0.8%

1.6%

2.0%

2.5%

5.2%

5.3%

-25% -15% -5% 5% 15%

Basic resources

Banks

Automobile

Technology

Transportation & Logistics

Food & Beverages

Financial services

Software

Chemicals

Prime All Share Index

Industrial

Construction

Media

Insurance

Retail

Pharma & Healthcare

Telecommunication

Utilities

Consumer

1M

3M

Source: DataStream, Deutsche Bank estimates and calculations Source: DataStream, Deutsche Bank estimates and calculations

Figure 77: Strongest outperforming stocks 2013 YTD

(Prime All Shares <E5bn market capitalisation)

Figure 78: Strongest underperforming stocks 2013 YTD

(Prime All Shares <E5bn market capitalisation)

S. No. Company Price

Target Price Rec.

Rel. to Prime. Sector

Rel. Prime Index


Rel. Prime Index

1 Nordex 5.0 3.0 H 62 68 -41 -26

2 Air Berlin 2.1 3.5 B 37 39 -82 -41

3 Koenig & Bauer AG 17.0 12.0 H 27 34 8 24

4 Sartorius 86.5 47.0 B 22 32 95 111

5 Freenet AG 18.3 17.0 B 30 31 32 37

6 Zooplus AG 41.2 50.0 B 23 29 -20 -29

7 Draegerwerk AG 98.1 115.0 B 17 28 5 21

8 AIXTRON 11.3 14.0 B 26 27 -14 -14

9 Heidelberger Druck 1.6 2.5 B 20 26 -25 -10

10 Villeroy & Boch 8.3 7.0 H 10 24 -22 13

2013 YTD Perf. (%)

2012 Perf. (%)

S. No. Company Price

Target Price Rec.


Rel. Prime Index


Rel. Prime Index

1 Salzgitter 30.3 36.0 H -7 -23 -13 0

2 Dialog Semiconductor 10.9 15.0 H -20 -18 2 3

3 Singulus Technologies 1.2 2.5 H -23 -17 -50 -35

4 YOC AG 7.1 NA H -17 -17 -51 -47

5 Euromicron 15.6 17.0 H -16 -14 11 12

6 Aurubis 46.3 58.0 H 2 -14 16 29

7 Evotec 2.3 2.6 H -24 -14 -5 11

8 Software AG 27.9 38.0 B -13 -13 -35 9

9 Solarworld AG 0.9 NA H -19 -13 -83 -68

10 ElringKlinger AG 22.6 21.0 H -7 -11 -8 28

2013 YTD Perf. (%)

2012 Perf. (%)

Source: DataStream, Deutsche Bank estimates and calculations Source: DataStream, Deutsche Bank estimates and calculations

9 April 2013



A.3 Earnings

This section presents the latest changes to recommendations, target prices and EPS estimates among Deutsche Bank analysts for German SMEs (<E5bn Mcap).

Figure 79: Recommendation and estimates changes by

DB analysts over the past one month (Prime All Shares)

Figure 80: Prime All Share stocks (<E5bn Mcap) with

strongest EPS up/downgrades

Company Rec. New OldPrice

05/04/13

RecommendationRheinmetall S H 35.2

No rec. changes over the past one monthTarget Price

Morphosys B 43.0 26.5 30.5 KUKA AG H 30.0 23.0 31.1 United Internet B 22.0 19.0 18.6 Draegerwerk AG-PREF B 115.0 100.0 98.1 Symrise H 29.0 26.0 30.6 Axel Springer H 42.0 40.0 33.7 SGL Group SE H 30.0 31.0 30.3 Gerresheimer H 43.0 45.0 42.9 HHLA H 17.0 18.0 17.2 Evotec H 2.6 2.9 2.3 Rheinmetall S 31.0 35.0 35.2 Salzgitter H 36.0 41.0 30.3 Fraport AG B 52.0 60.0 43.1

EPS 2013Prime Office H 0.01 -0.02 3.4 Gildemeister AG H 1.39 1.23 15.0 KUKA AG H 2.07 1.90 31.1 Symrise H 1.74 1.80 30.6 Gerresheimer H 2.79 2.88 42.9 XING AG H 1.94 2.01 39.6 ElringKlinger AG H 1.53 1.59 22.6 Stroeer B 0.64 0.66 8.1 Celesio H 1.28 1.35 14.7 Fraport AG B 2.52 2.72 43.1 Deutsche Wohnen H 0.67 0.74 13.7 PUMA SE H 14.62 16.29 231.9 Axel Springer H 2.55 2.97 33.7 Hornbach Holding B 3.97 4.68 49.6 Tom Tailor B 1.60 1.94 17.3 Evotec H 0.06 0.08 2.3 HHLA H 0.75 1.10 17.2 Salzgitter H 1.04 1.74 30.3 Rheinmetall S 2.33 4.91 35.2 SGL Group SE H 0.65 1.40 30.3 Morphosys B -0.58 0.08 30.5 SMA B -0.60 0.07 18.2

Noteworthy Target Price (TP) changes are highlighted in Bold and Italicised.

These are cases where the revision of TP is in the alternate direction

compared to the current price's position versus the original TP. For instance,

if the current price is less than or marginally above the original TP and the TP

is further increased, we highlight it as noteworthy.

1) Strongest 1M EPS upgrades in 2013E

S. No. Company

Curr. Price*

2013EEPS

1M % change

1M perf. (%)

1 Koenig & Bauer AG 17.0 1.44 25.2 4.22 ROFIN-SINAR 19.9 1.58 11.3 -3.63 Elmos 8.1 0.57 9.6 1.24 Duerr 78.6 7.05 7.5 -7.75 Wacker Neuson SE 11.3 1.01 6.3 1.46 Heidelberger Druck 1.6 0.17 6.3 -26.17 Jenoptik 7.9 0.65 4.8 2.78 Douglas 38.1 1.78 4.7 -1.09 Krones 54.2 3.62 4.6 6.810 Stroeer 8.1 0.60 3.4 -5.8

05-Apr-13

2) Strongest 3M EPS upgrades in 2013E

S. No. Company

Curr. Price*

2013EEPS

3M % change

3M perf. (%)

1 Koenig & Bauer AG 17.0 1.44 25.2 22.02 Heidelberger Druck 1.6 0.17 21.4 19.53 ROFIN-SINAR 19.9 1.58 16.2 13.84 C.A.T. oil 8.0 0.71 12.7 17.25 Tipp24 41.3 3.49 11.1 9.26 Duerr 78.6 7.05 9.6 13.17 Elmos 8.1 0.57 9.6 12.18 KUKA AG 31.1 1.90 6.1 8.89 Qiagen 15.7 1.16 5.5 10.010 Wacker Neuson SE 11.3 1.01 5.2 7.7

05-Apr-13 2013E

3) Strongest 1M EPS downgrades in 2013E

S. No. Company

Curr. Price*

2013EEPS

1M % change

1M perf. (%)

1 Salzgitter 30.3 0.85 -40.6 -16.22 Kontron AG 4.3 0.18 -37.9 -6.23 SGL Group SE 30.3 0.81 -34.7 -6.74 BB BIOTECH 82.2 6.64 -28.7 0.75 Evotec 2.3 0.08 -20.0 -14.26 ADVA 3.8 0.30 -18.9 -12.57 Euromicron 15.6 2.03 -16.8 3.28 BayWa 36.2 2.19 -14.8 -5.79 Tom Tailor 17.3 1.25 -14.4 -0.410 Deutz AG 3.9 0.31 -13.9 -15.2

2013E05-Apr-13

4) Strongest 3M EPS downgrades in 2013E

S. No. Company

Curr. Price*

2013EEPS

3M % change

3M perf. (%)

1 Salzgitter 30.3 0.85 -45.5 -25.62 Kontron AG 4.3 0.18 -45.5 -4.73 SGL Group SE 30.3 0.81 -34.7 -2.94 BB BIOTECH 82.2 6.64 -28.7 14.85 Tomorrow Focus 4.2 0.26 -27.8 12.76 Villeroy & Boch 8.3 0.58 -20.5 24.17 Evotec 2.3 0.08 -20.0 -17.28 Rhoen Klinikum 16.1 0.83 -19.4 6.59 DAB bank 3.6 0.21 -19.2 -6.610 ADVA 3.8 0.30 -18.9 -10.6

2013E05-Apr-13

Source: DataStream, Deutsche Bank estimates Source: DataStream, Deutsche Bank estimates

9 April 2013



A.4 Consensus recommendation momentum

In addition to earnings, IBES collects data on ratings and calculates a consensus rating for each company on a scale from 1 to 5 (1 is a strong buy and 5 is a sell). The tables below show German SMEs (<E5bn Mcap) most and least preferred by analysts. In our view, it is especially interesting to look at companies that are among the least preferred and where the recommendation momentum starts to improve (see Figure 82; highlighted in bold). Momentum could flag a change in awareness of the company in the market. We also highlight companies that are among the most preferred German SMEs and where the recommendation momentum is starting to fade (see Figure 81; highlighted in bold). The lower 2 tables show the companies with the strongest positive and strongest negative recommendation momentum.

A.4.1) Companies with highest and lowest consensus recommendation

Figure 81: Companies with highest consensus

recommendation (IBES consensus)

Figure 82: Companies with lowest consensus

recommendation (IBES consensus)

S. No. Company

Curr. Price

Target price Curr.

1M chng

3M chng

1 BayWa 36.2 40.5 11.9 1.70 -0.03 0.052 DIC Asset AG 7.4 10.0 35.4 1.70 0.07 -0.013 Draegerwerk AG 98.1 106.1 8.2 1.70 -0.03 0.224 VTG AG 13.4 16.7 24.9 1.70 -0.01 -0.205 Alstria 8.9 10.4 16.7 1.90 -0.06 -0.116 Freenet AG 18.3 18.4 0.8 1.90 0.03 0.107 Aareal Bank 16.2 20.7 28.0 2.00 0.23 -0.188 Bilfinger SE 77.1 83.0 7.6 2.00 0.08 0.139 GSW Immobilien 8.0 9.7 20.9 2.00 -0.08 -0.0810 Gerresheimer 42.9 47.8 11.4 2.00 0.13 0.3311 Jungheinrich 31.8 36.7 15.3 2.00 -0.12 -0.3712 QSC AG 2.4 2.9 20.1 2.00 0.25 0.7513 Tom Tailor 17.3 21.1 22.1 2.00 -0.09 -0.0914 Dialog Semiconductor 10.9 17.0 56.3 2.20 0.08 0.1815 Duerr 78.6 87.2 11.0 2.20 -0.14 -0.08

05-Apr-13 Consensus Rec. *upside poten.

(%)

S. No. Company

Curr. Price

Target price Curr.

1M chng

1W chng

1 SGL Group SE 30.3 23.0 -24.0 4.20 -0.04 -0.042 Praktiker 1.1 1.5 32.4 3.90 -0.34 0.303 ElringKlinger AG 22.6 23.1 2.3 3.60 -0.55 -1.014 IVG Immobilien AG 0.6 1.8 198.2 3.36 -0.63 -0.575 Wacker Chemie AG 55.3 53.4 -3.4 3.32 0.00 -0.326 Symrise 30.6 28.0 -8.6 3.30 0.08 0.077 SMA 18.2 18.8 3.0 3.30 0.27 0.518 Rational AG 229.3 230.4 0.5 3.20 -0.20 -0.459 Fuchs Petrolub AG 64.1 52.9 -17.4 3.20 0.19 -0.0910 KUKA AG 31.1 31.4 0.8 3.14 -0.30 -0.3111 PUMA SE 231.9 234.3 1.0 3.10 -0.06 -0.1012 Delticom AG 35.9 40.4 12.5 3.10 -0.17 -0.1013 Carl Zeiss Meditec 23.1 23.8 3.1 3.10 0.06 -0.1014 Air Berlin 2.1 2.1 0.0 3.10 0.72 1.0715 Vossloh 79.0 75.9 -3.9 3.00 -0.13 -0.14


(%)

*Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank *Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is

underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank

A.4.2) Companies with highest improvement and decline in consensus recommendation

Figure 83: Companies with highest 1M improvement in

consensus recommendation (IBES consensus)

Figure 84: Companies with highest 1M decline in

consensus recommendation (IBES consensus)

S. No. Company

Curr. Price

Target price Curr.

1M chng

1W chng

1 Air Berlin 2.1 2.1 0.0 3.10 0.72 1.072 Kloeckner & Co. 10.4 10.7 2.2 2.70 0.48 0.513 Rhoen Klinikum 16.1 16.3 1.2 2.30 0.30 0.184 SMA 18.2 18.8 3.0 3.30 0.27 0.515 QSC AG 2.4 2.9 20.1 2.00 0.25 0.756 Wincor Nixdorf 36.7 39.5 7.7 2.70 0.25 -0.187 Aareal Bank 16.2 20.7 28.0 2.00 0.23 -0.188 GEA 25.6 28.1 9.9 2.30 0.23 0.179 Krones 54.2 51.2 -5.7 2.90 0.21 0.2110 GAGFAH 9.0 8.8 -2.4 2.80 0.20 0.2011 GfK 40.3 43.1 7.1 2.40 0.20 0.1312 TAG Immobilien AG 8.7 9.4 9.1 2.60 0.20 0.1013 Wacker Neuson SE 11.3 12.2 8.1 2.80 0.20 0.3814 Fuchs Petrolub AG 64.1 52.9 -17.4 3.20 0.19 -0.0915 TUI AG 7.8 9.1 16.1 2.30 0.17 -0.08


(%)

S. No. Company

Curr. Price

Target price Curr.

1M chng

1W chng

1 IVG Immobilien AG 0.6 1.8 198.2 3.36 -0.63 -0.572 ElringKlinger AG 22.6 23.1 2.3 3.60 -0.55 -1.013 Praktiker 1.1 1.5 32.4 3.90 -0.34 0.304 KUKA AG 31.1 31.4 0.8 3.14 -0.30 -0.315 Kontron AG 4.3 3.9 -10.0 2.90 -0.26 -0.406 Rheinmetall 35.2 43.0 22.2 2.50 -0.21 -0.337 Rational AG 229.3 230.4 0.5 3.20 -0.20 -0.458 Wirecard 20.3 21.2 4.6 2.29 -0.17 -0.359 Delticom AG 35.9 40.4 12.5 3.10 -0.17 -0.1010 Duerr 78.6 87.2 11.0 2.20 -0.14 -0.0811 Vossloh 79.0 75.9 -3.9 3.00 -0.13 -0.1412 Jungheinrich 31.8 36.7 15.3 2.00 -0.12 -0.3713 Tom Tailor 17.3 21.1 22.1 2.00 -0.09 -0.0914 Stada Arzneimittel AG 29.5 30.0 1.6 2.50 -0.08 -0.1515 GSW Immobilien 8.0 9.7 20.9 2.00 -0.08 -0.08


(%)

*Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank

*Consensus Recommendation between 1-1.5 is Strong Buy,1.5-2.5 is Buy,2.5-3.5 is Hold,3.5 to 4.5 is underperform and above 4.5 is Sell. Source: IBES, DataStream, Deutsche Bank

9 April 2013



A.5 Directors’ Dealings

This section monitors Directors' Dealings among German SMEs (<E5bn Mcap). Empirical analyses suggest that investors can benefit by mimicking buy transactions in particular.

Figure 85: Directors’ dealings for PRIMALL SMEs Figure 86: Stocks with highest net buying (Q1 2013)

1) Directors’ Buying

0

5,000

10,000

15,000

20,000

25,000

May

-09

Sep

-09

Jan-

10

May

-10

Sep

-10

Jan-

11

May

-11

Sep

-11

Jan-

12

May

-12

Sep

-12

Jan-

13

Companies Bought in past 10 days Companies Bought in past 50 days

(EUR k)

2) Directors’ Selling

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

May

-09

Sep

-09

Jan-

10

May

-10

Sep

-10

Jan-

11

May

-11

Sep

-11

Jan-

12

May

-12

Sep

-12

Jan-

13

Companies Sold in past 10 days Companies Sold in past 50 days

(EUR k)

3) Net directors’ Buying

-15,000

-10,000

-5,000

0

5,000

10,000

15,000

20,000

May

-09

Sep

-09

Jan-

10

May

-10

Sep

-10

Jan-

11

May

-11

Sep

-11

Jan-

12

May

-12

Sep

-12

Jan-

13

10-day Director Net Buying in '000s 50-day Director Net Buying in '000s

(EUR k)

Company

Purchase Vol (EUR)

Sale Vol (EUR)

Net Purchase Vol (EUR)

RIB Software AG 6,200,000 6,200,000GRENKE Group 4,463,925 4,463,925Gerry Weber 361,066 361,066YOC AG 222,981 222,981Gerresheimer 211,550 211,550Muehlbauer 194,869 194,869Ahlers 65,800 65,800Euromicron 62,400 62,400MOLOGEN AG 52,417 52,417INTERSHOP COMM. 37,470 37,470EXCEET GROUP SE RED. A 34,956 34,956TAG Immobilien AG 30,488 30,488Jetter AG 30,293 30,293SAG SOLARSTROM AG 29,200 29,200ElringKlinger AG 26,050 26,050H&R AG 24,288 24,288Quanmax AG 17,320 17,320Wacker Chemie AG 16,134 16,134Pulsion Medical Systems 20,000 4,054 15,946BB BIOTECH 15,783 15,783AAP Implantate 13,340 13,340Software AG 8,700 8,700Suedzucker 5,895 5,895Rational AG 5,014 5,014IVU Traffic Technologies 3,816 3,816Alphaform 323 323comdirect 8,567 -8,567CropEnergies 10,452 -10,452Advanced Vision 11,571 -11,571GEA 16,578 -16,578Progress-Werk 17,005 -17,005C.A.T. oil 30,608 -30,608Hugo Boss 35,592 -35,592Sky Deutschland 70,950 -70,950Krones 100,100 -100,100Carl Zeiss Meditec 120,588 -120,588WILEX AG O.N. 170,040 -170,040MBB INDUSTRIES AG 201,956 -201,956SAF Holland SA 391,300 -391,300INIT Innovation In Traffic 411,923 -411,923Eckert & Ziegler 451,350 -451,350SGL Group SE 498,378 -498,378Qiagen 1,820,025 -1,820,025Name 6,080,000 -6,080,000Tipp24 6,748,590 -6,748,590Duerr 15,748,928 -15,748,928

Source: Deutsche Bank Equity Strategy, 2iQ Research Source: Deutsche Bank Equity Strategy, 2iQ Research

9 April 2013



A.6 Traditional valuation

Figure 87: German Small & Mid caps (<E5bn)

with lowest P/E ratio 2013E


with highest dividend yield 2013E Price Mcap Target Rec.

S. No. Company 05/04/13

(EUR mn)

Price LastWeek YTD 2013E

1 Euromicron 15.6 104 17.0 H -0.7 -14.3 7.92 SAF Holland SA 5.8 265 5.0 H -4.3 11.5 8.43 Jungheinrich 31.8 1,081 32.0 B -3.0 7.9 9.44 Bauer AG 18.9 324 18.0 H -4.9 -2.0 9.45 Aurubis 46.3 2,084 58.0 H -6.6 -11.8 9.46 Sixt AG 15.5 744 16.0 H 1.2 -1.3 9.57 Aareal Bank 16.2 968 20.5 B -2.2 2.9 9.68 Schaltbau Holding Ag 31.4 193 38.0 B -2.4 1.3 9.79 LEONI 29.3 958 27.0 H -3.0 2.7 9.810 Freenet AG 18.3 2,341 17.0 B -3.6 30.6 10.011 Duerr 78.6 1,359 95.0 B -7.6 16.4 10.312 C.A.T. oil 8.0 392 9.5 B -13.9 18.9 10.313 Stada Arzneimittel AG 29.5 1,767 33.0 B -7.7 20.8 10.314 Software AG 27.9 2,426 38.0 B -7.5 -13.1 10.415 Tom Tailor 17.3 418 19.0 B -1.7 7.1 10.8

Perf. (%) P/E (x) Price Mcap Target Rec.S. No. Company 05/04/13

(EUR mn)

Price LastWeek YTD

1 Tipp24 41.3 330 50.0 B -0.5 9.9 12.12 Alstria 8.9 703 10.7 B 1.3 -3.8 6.63 Freenet AG 18.3 2,341 17.0 B -3.6 30.6 6.64 comdirect 8.0 1,131 9.0 B -2.2 1.5 6.25 DAB bank 3.6 323 3.5 H -3.0 -2.8 6.06 Axel Springer 33.7 3,328 42.0 H -0.3 4.4 5.07 SAF Holland SA 5.8 265 5.0 H -4.3 11.5 4.78 Muehlbauer 21.7 133 21.0 H -3.8 7.7 4.69 CEWE COLOR 32.8 215 38.0 B -0.6 5.7 4.610 Rheinmetall 35.2 1,337 31.0 S -2.5 -3.3 4.511 Delticom AG 35.9 426 28.0 S 0.2 11.1 4.412 Villeroy & Boch 8.3 102 7.0 H 0.0 30.3 4.213 LEG 41.3 2,185 48.5 B -1.3 -7.3 4.214 QSC AG 2.4 300 2.8 B -7.0 15.5 4.115 Deutsche EuroShop 30.8 1,661 33.0 H -2.4 -2.7 4.1

Div. yield (%)

2013E

Perf. (%)



with lowest EV/EBITDA 2013E


with highest EV/EBITDA 2013E Price Mcap Target Rec.


(EUR mn)

Price LastWeek YTD

1 Gigaset AG 0.9 46 1.2 H -5.4 -5.1 1.72 Loewe AG 3.1 41 H -0.8 12.3 1.73 TUI AG 7.8 2,420 10.3 B -6.9 -0.7 2.24 ADVA 3.8 185 4.5 H 4.8 -5.0 2.55 Constantin Medien AG 1.8 139 1.4 H -2.1 17.8 2.66 CEWE COLOR 32.8 215 38.0 B -0.6 5.7 3.37 Elmos 8.1 158 7.4 H -5.8 13.7 3.38 Jungheinrich 31.8 1,081 32.0 B -3.0 7.9 3.49 QSC AG 2.4 300 2.8 B -7.0 15.5 3.810 Sixt AG 15.5 744 16.0 H 1.2 -1.3 4.011 Tipp24 41.3 330 50.0 B -0.5 9.9 4.212 C.A.T. oil 8.0 392 9.5 B -13.9 18.9 4.313 LEONI 29.3 958 27.0 H -3.0 2.7 4.414 Koenig & Bauer AG 17.0 281 12.0 H -4.6 33.5 4.415 Gildemeister AG 15.0 897 H -8.5 -1.6 4.7

Perf. (%) EV/ EBITDA

2013E(x)

Price Mcap Target Rec.S. No. Company 05/04/13

(EUR mn)

Price LastWeek YTD

1 GSW 29.7 1,501 36.0 B -3.7 -7.2 21.72 Deutsche Wohnen 13.7 2,203 15.5 H -3.3 -2.1 20.73 GAGFAH 9.0 1,844 8.0 H -6.2 1.4 20.34 Praktiker 1.1 126 2.6 B -2.7 -4.2 18.45 LEG 41.3 2,185 48.5 B -1.3 -7.3 18.46 YOC AG 7.1 14 H -7.9 -16.6 17.07 Alstria 8.9 703 10.7 B 1.3 -3.8 16.58 Wirecard 20.3 2,276 16.0 H -5.9 9.0 16.59 Rational AG 229.3 2,607 H -2.2 5.2 16.510 Deutsche EuroShop 30.8 1,661 33.0 H -2.4 -2.7 15.911 SGL Group SE 30.3 2,140 30.0 H -1.3 0.8 13.312 GRENKE Group 56.4 830 47.0 H 1.8 11.5 13.213 Delticom AG 35.9 426 28.0 S 0.2 11.1 12.814 Stratec 33.8 396 32.0 H -3.3 -10.2 12.815 Qiagen 20.5 3,735 21.5 B -2.9 13.8 12.7

Perf. (%) EV/ EBITDA

2013E(x)



with lowest Price/Book ratio 2013E


with highest Price/Book ratio 2013E Price Mcap Target Rec.


(EUR mn)


1 Singulus Technologies 1.2 56 2.5 H -9.8 -17.0 0.32 Solarworld AG 0.9 102 H 8.7 -12.6 0.43 Prime Office 3.4 177 3.5 H 6.2 4.9 0.54 Aareal Bank 16.2 968 20.5 B -2.2 2.9 0.55 Loewe AG 3.1 41 H -0.8 12.3 0.66 Koenig & Bauer AG 17.0 281 12.0 H -4.6 33.5 0.67 Kloeckner & Co. 10.4 1,221 9.5 H -5.6 16.4 0.68 Heidelberger Druck 1.6 362 2.5 B -13.6 26.3 0.79 Bauer AG 18.9 324 18.0 H -4.9 -2.0 0.710 Kontron AG 4.3 239 3.7 H 1.1 4.2 0.711 TUI AG 7.8 2,420 10.3 B -6.9 -0.7 0.812 GAGFAH 9.0 1,844 8.0 H -6.2 1.4 0.813 Euromicron 15.6 104 17.0 H -0.7 -14.3 0.814 SMA 18.2 632 25.0 B -2.4 -4.1 0.815 Elmos 8.1 158 7.4 H -5.8 13.7 0.8

P/B (x)Perf. (%) Price Mcap Target Rec.S. No. Company 05/04/13

(EUR mn)


1 Rational AG 229.3 2,607 H -2.2 5.2 9.62 United Internet 18.6 3,600 22.0 B -2.2 13.7 7.63 Zooplus AG 41.2 251 50.0 B 0.9 29.0 7.14 Delticom AG 35.9 426 28.0 S 0.2 11.1 6.85 Fuchs Petrolub AG-PREF 64.1 4,384 46.0 H -2.3 14.0 5.46 CTS Eventim AG 26.6 1,276 32.0 B 0.5 -0.3 5.37 Fielmann 73.2 3,074 60.0 S 1.7 0.3 5.28 Hawesko 43.0 386 40.0 H 6.4 7.4 4.49 Sky Deutschland 3.9 3,372 4.5 H -9.5 -5.8 4.110 Compugroup Medical AG 16.8 841 23.0 B -2.5 14.4 3.911 Stratec 33.8 396 32.0 H -3.3 -10.2 3.812 Symrise 30.6 3,619 29.0 H -0.9 12.9 3.713 Wirecard 20.3 2,276 16.0 H -5.9 9.0 3.714 XING AG 39.6 217 50.0 H -4.0 -5.4 3.715 Bertrandt AG 86.0 866 75.0 H -5.5 16.3 3.6

Perf. (%) P/B (x)


Mad

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7

Figure 93: German benchmarks and Prime All Share sectors

Price

05/04/13 2012 2013e 2014e 2015e 13e 14e 15e 12 13e 14e 15e (total/up/down) ratioGermany (DAX 30) 7658.8 706.2 680.2 772.3 844.8 -3.7 13.5 9.4 11.3 11.8 10.4 9.5 (29/8/21) -0.45

-1.1/-2.2/-7.5 -1.1/-2.3/-5.5 -0.7/-1.3/-2.8 9.2 9.8 11.1 (870/109/208) -0.11Germany (MDAX) 12922.9 811.2 900.7 1087.6 1200.9 11.0 18.3 12.8 16.7 15.0 12.4 11.3 (42/17/25) -0.19

-0.7/-2.7/-5.6 +0.2/+0.2/-1.5 +0.7/+2.3/+3.0 11.7 12.2 12.5 (761/104/143) -0.05Germany (TECDAX) 903.5 39.5 44.9 58.1 75.0 13.8 29.4 21.8 23.4 20.6 15.9 12.3 (26/9/14) -0.19

-6.7/-9.3/-19.8 -3.4/-4.0/-12.9 +1.3/+1.4/-0.9 22.9 19.4 14.2 (256/23/47) -0.09Germany (HDAX) 3954.8 346.7 338.8 387.8 426.5 -2.3 14.3 10.0 11.9 12.2 10.7 9.7 (97/34/60) -0.27

-1.2/-2.3/-7.4 -0.9/-2.0/-5.2 -0.5/-0.9/-2.1 9.6 10.2 11.3 (1887/236/398) -0.09Prime All Share 2910.8 255.3 248.8 284.9 313.5 -2.6 14.4 10.0 11.9 12.2 10.7 9.7 (231/69/100) -0.13

-1.2/-2.3/-7.3 -0.9/-1.9/-5.1 -0.5/-0.8/-1.9 9.8 10.4 11.4 (2358/284/448) -0.07Automobiles 929.8 157.6 114.5 130.0 142.1 -27.3 13.5 9.3 6.4 8.7 7.7 7.0 (10/2/8) -0.60

-2.2/-3.0/-10.5 -1.0/-1.2/-8.3 -0.2/+1.1/-1.9 7.6 9.5 12.9 (164/14/48) -0.21Banks 152.8 13.6 20.0 25.4 30.9 47.5 26.9 21.5 12.4 8.4 6.6 5.4 (3/1/2) -0.33

-2.6/-7.7/-15.8 -2.4/-6.1/-10.5 -4.2/-7.0/-6.2 23.8 15.0 13.9 (73/4/22) -0.25Basic resources 1684.0 93.9 136.5 189.6 220.8 45.4 38.9 26.1 20.6 14.1 10.2 8.7 (5/3/1) 0.40

-1.9/-2.9/-12.3 -1.0/-1.2/-4.4 -10.0/-6.2/-2.9 13.8 25.3 22.6 (48/4/8) -0.08Chemicals 1865.3 137.2 143.6 156.7 169.3 4.7 9.1 8.1 14.2 13.6 12.5 11.5 (8/1/7) -0.75

-0.4/-0.7/-4.3 -1.0/-2.0/-4.2 -0.3/-0.3/-1.0 8.0 8.8 10.0 (195/26/43) -0.09Construction 635.2 38.1 43.9 58.0 74.3 15.4 32.0 28.0 18.1 15.7 11.9 9.3 (4/1/2) -0.25

-1.7/-4.1/-7.6 -1.6/-3.1/-4.4 -0.8/-1.4/-0.1 10.8 11.4 13.0 (58/7/15) -0.14Consumer 1178.4 56.0 63.2 72.1 81.2 12.9 14.1 12.8 21.5 19.0 16.7 14.8 (11/3/5) -0.18

-0.4/-0.5/-0.1 -0.2/-0.4/+0.6 -0.1/+0.5/+5.8 4.2 5.7 6.1 (160/21/45) -0.15Financial services 751.9 50.7 54.4 59.4 66.0 7.4 9.2 10.9 16.0 14.9 13.6 12.3 (20/3/11) -0.40

-2.3/-4.9/-8.0 -1.5/-2.3/-5.4 -3.9/-3.6/-5.4 15.9 17.2 15.0 (157/13/35) -0.14Food & Beverages 750.6 68.5 59.3 56.1 60.5 -13.4 -5.4 7.8 11.2 12.9 13.7 12.7 (1/0/1) -1.00

-0.1/+0.7/+7.8 +0.2/+0.9/+4.5 +9.2/+7.9/+19.2 8.0 10.3 13.3 (16/0/0) 0.00Industrials 3480.3 202.3 246.0 315.2 355.7 21.6 28.2 11.9 18.2 15.0 11.7 10.3 (62/27/22) 0.08

+0.2/-0.1/-6.7 +0.6/+1.2/+2.1 +0.9/+0.6/+2.0 12.7 9.7 11.3 (514/76/44) 0.06Insurance 457.5 51.0 51.7 53.6 54.1 1.3 3.8 0.9 9.3 9.2 8.8 8.7 (3/2/1) 0.33

+0.3/+1.4/+1.5 +0.3/+1.0/+0.9 +3.6/+3.9/+1.5 5.9 7.4 8.7 (100/26/11) 0.15Media 210.1 15.3 15.4 16.7 18.3 0.4 8.3 9.7 14.3 14.2 13.1 12.0 (6/2/2) 0.00

-2.8/-7.5/-9.9 -0.8/-6.2/-8.5 -2.4/-3.6/-11.8 9.0 10.0 7.4 (50/12/17) -0.10Pharma & Healthcare 2613.7 157.8 157.5 176.2 201.8 -0.2 11.9 14.2 16.2 16.3 14.5 12.7 (26/10/8) 0.08

-2.0/-2.2/-4.5 -1.6/-1.9/-4.3 -2.4/-1.8/-2.6 7.1 8.0 6.2 (216/28/68) -0.19Retail 237.1 5.3 13.7 24.3 22.9 nm 47.7 13.9 nm 17.5 9.8 10.5 (13/5/4) 0.08

-1.2/+9.9/-11.0 +2.0/-1.5/-7.2 +2.1/0.0/-2.9 29.5 15.3 13.4 (90/7/4) 0.03Software 15620.5 787.6 905.9 1037.5 1168.4 15.0 14.5 13.0 21.2 18.4 16.1 14.3 (25/3/9) -0.24

-0.1/-1.9/-1.5 -0.3/-1.8/+0.1 -0.9/+1.4/+10.8 5.8 6.5 5.8 (141/7/20) -0.09Technology 387.1 16.1 13.6 25.0 33.8 -15.9 84.1 36.6 25.3 30.1 16.3 12.1 (17/3/6) -0.18

-5.9/-7.2/-46.2 -2.8/-2.6/-23.8 +1.4/-0.3/-21.4 22.2 19.1 23.7 (124/14/24) -0.08Telecommunications 107.7 7.5 8.8 9.5 10.1 18.5 7.6 6.8 14.5 12.3 11.4 10.7 (5/0/3) -0.60

-1.9/-3.2/+2.2 -0.9/+0.6/+5.2 -5.8/+2.1/+11.7 17.9 17.8 18.4 (40/6/13) -0.18Transportation & Logistics 457.3 30.7 34.7 44.2 52.8 13.1 27.5 19.4 16.3 14.4 11.3 9.5 (9/3/5) -0.22

+1.4/+0.4/-0.5 +1.7/+3.3/+4.1 +4.6/+7.7/+13.8 13.8 14.8 18.3 (145/15/14) 0.01Utilities 751.9 111.8 80.2 80.8 78.0 -28.3 0.8 -3.5 6.3 8.8 8.8 9.1 (3/0/3) -1.00

-3.7/-8.2/-19.6 -6.0/-13.9/-24.9 -5.2/-16.8/-29.4 7.3 14.6 11.4 (67/4/17) -0.19

Earnings (index points) Growth (YoY, %) P/E ratio (x) 12m fwd. company revisionRevisions 1m/3m/6m (%) Uncertainty (%) 12m fwd. analyst revision

Source: IBES, DataStream, Deutsche Bank

Mad

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A.7 Index agglomerations

Figure 94: German SME equity universe covered by Deutsche Bank (ex-financials) (including stocks with a market capitalization <E5bn)

Model updat ed: 05 April 2013 Year Ending 31 December 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E

INCOME STATEMENT (EUR bn)Sales revenue 12 13 14 13 15 22 22 34 41 44 45 56 77 134 154 175 169 194 214 224 234 216Operat ing EBITDA 1 1 1 1 1 2 2 3 4 4 4 6 8 12 16 17 13 19 20 20 21 22Depreciat ion 0 0 0 1 1 1 1 1 2 2 2 2 3 4 4 5 6 6 7 7 7 6Amort isat ion 0 0 0 0 0 0 0 0 1 1 1 0 0 1 0 1 1 1 1 1 0 0EBIT 0 0 0 0 0 1 1 1 2 1 1 3 5 8 11 11 6 12 12 12 14 15Net int erest income (expense) 0 0 0 0 0 0 0 0 -1 -1 0 -1 -1 -1 -1 -2 -2 -3 -3 -3 -3 -2Associat es/ af f iliat es 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Invest ment and ot her income/ expens 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Except ionals/ ext raordinaries 0 0 0 0 0 0 0 0 0 0 0 0 0 1 -1 0 0 0 0 0 0 0Income t ax expense 0 0 0 0 0 0 0 1 1 0 1 1 1 2 3 3 1 3 3 3 3 4Minorit ies/ pref erence dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Net income 0 0 0 0 0 1 1 1 1 0 0 2 3 5 6 5 1 6 6 6 7 9

CASH FLOW (EUR bn)Cash f low f rom operat ions 1 1 1 1 1 1 1 1 2 3 3 4 5 7 10 11 14 12 11 11 15 14Movement in net working capit al 0 0 0 0 0 0 0 -1 0 0 1 0 -1 -2 -2 -1 5 -1 -2 -1 0 -1Capex -1 -1 -1 -1 -1 -1 -1 -2 -2 -2 -2 -3 -3 -5 -8 -9 -8 -8 -10 -12 -9 -7Free cash f low 0 0 0 0 0 0 0 -1 0 1 1 1 1 1 2 1 6 4 2 -1 5 7Ot her invest ing act ivit ies 0 0 0 0 0 -1 -2 -2 0 2 2 0 -1 1 -4 -1 -1 0 1 -1 1 0Equit y raised/ (bought back) 0 0 0 0 0 0 1 0 0 0 0 1 2 1 1 -1 2 2 2 1 1 0Dividends paid 0 0 0 0 0 0 0 0 -1 0 0 -1 -1 -1 -2 -2 -2 -2 -3 -3 -3 -3Net inc/ (dec) in borrowings 0 0 0 0 0 0 0 2 -2 -2 0 0 -1 0 3 1 0 -1 0 3 -1 0Ot her f inancing cash f lows 0 0 0 0 1 0 0 0 1 0 0 0 0 -1 -1 -1 -1 -1 -1 -1 0 0Tot al cash f lows f rom f inancing 0 0 0 0 1 0 0 2 -1 -2 0 0 1 0 1 -3 -1 -2 -1 1 -3 -3Net cash f low 0 0 0 0 0 -1 -2 0 -1 0 2 1 2 3 0 -3 5 2 2 -1 3 4Movement in net debt / (cash) 0 0 0 0 0 2 2 2 -1 -2 -2 -2 -2 -3 3 4 -5 -3 -1 4 -4 -4

Revenues Calenderised 2013 (EUR bn) BALANCE SHEET (EUR bn)Cash and ot her liquid asset s 1 1 1 1 1 2 3 2 2 2 3 5 7 11 13 14 20 21 21 20 22 22Tangible f ixed asset s 3 3 3 3 3 4 6 8 12 12 14 16 20 28 34 40 46 49 57 66 67 62Goodwill 0 0 0 0 0 1 3 5 5 5 5 5 6 9 10 13 14 15 16 16 16 13Ot her int angible asset s 0 0 0 0 0 0 0 0 1 1 2 2 6 9 12 15 15 15 17 20 20 19Associat es/ invest ment s 1 1 1 1 1 1 1 1 2 1 2 3 3 4 5 5 6 8 8 8 8 6

Tot al Ot her asset s 3 3 3 3 3 5 8 9 13 14 14 19 27 44 53 64 62 69 75 78 81 77Tot al asset s 7 7 8 8 8 14 21 25 36 36 39 49 69 105 128 150 163 178 193 208 215 199Int erest bearing debt 1 1 1 1 1 2 5 8 10 10 9 10 13 21 28 37 42 43 48 55 54 49Ot her liabilit ies 5 5 5 5 5 8 11 11 14 16 18 23 31 45 54 62 65 70 74 77 78 68Tot al liabilit ies 6 6 6 6 6 10 16 18 25 25 27 33 44 66 82 99 106 113 122 131 133 117Shareholders' equit y 2 2 2 2 1 4 5 7 10 10 12 16 24 38 45 50 56 63 69 75 81 80Minorit ies 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 1 2 2 2 2Tot al shareholders' equit y 2 2 2 2 2 4 5 7 11 11 12 16 25 39 46 51 57 64 71 77 83 82Net working capit al 1 2 2 2 2 2 1 3 5 5 4 4 7 12 15 18 13 16 18 21 22 25Net debt (cash) -1 0 0 0 0 0 1 6 8 7 6 5 6 10 15 24 22 22 27 35 32 27Capit al 1 1 1 1 2 4 6 13 19 18 18 22 31 49 61 74 79 86 98 112 115 109

RATIO ANALYSISSales growt h (%) -5.2 6.3 8.3 -5.1 13.9 20.7 3.3 21.7 0.9 -4.3 -3.8 -0.1 7.0 10.3 9.5 6.1 -16.2 14.5 9.4 4.3 4.8 3.8Op. EBITDA/ sales (%) 5.1 5.7 5.5 5.8 6.0 7.3 8.0 7.9 9.8 8.5 8.5 10.1 10.1 9.2 10.2 9.8 7.9 9.7 9.2 8.9 9.1 10.1EBIT/ sales (%) 0.9 1.7 1.8 1.7 2.4 4.1 4.4 3.8 4.8 3.3 2.8 6.0 6.1 5.7 7.1 6.2 3.4 6.3 5.6 5.5 5.9 7.0Payout rat io (%) 136 115 104 74 55 52 51 63 55 74 83 29 30 28 37 37 140 42 44 46 41 36

Market Capit alizat ion - Current (EUR bn) ROE (%) 7.8 9.6 10.7 9.1 13.7 14.5 12.8 8.0 7.1 4.7 3.9 13.1 12.3 14.4 13.5 10.0 2.3 10.1 9.0 8.0 9.5 11.4Ret urn on Capit al (%) 8.5 10.6 11.3 10.3 16.4 15.6 11.9 6.5 6.1 4.2 3.7 11.5 11.6 13.6 12.3 9.4 2.5 9.5 8.6 7.6 8.5 9.9Operat ing Ret urn on Capit al (%) 2.1 3.9 5.1 4.4 6.3 10.4 7.5 5.5 6.4 3.7 2.9 10.2 11.7 12.1 13.6 10.3 2.0 10.0 9.0 8.1 8.6 9.8Capex/ sales (%) 6.2 6.2 5.4 9.0 3.8 4.3 5.4 4.5 5.2 4.9 5.1 4.5 4.3 4.0 5.1 5.3 4.8 4.2 4.6 5.3 4.0 3.4Capex/ depreciat ion (x) 1.5 1.6 1.5 2.2 1.1 1.5 1.8 1.3 1.3 1.2 1.2 1.1 1.2 1.3 1.7 1.6 1.2 1.2 1.3 1.6 1.3 1.1Net debt / equit y (%) -29.5 -20.7 -16.0 -21.2 -3.8 -2.1 27.1 84.4 76.4 66.3 45.4 33.5 24.3 24.7 33.2 46.3 38.0 33.5 37.8 44.8 38.4 33.1

Tot al Net int erest cover (x) nm nm nm nm 29.2 18.2 14.2 4.6 3.5 2.8 2.7 5.1 6.0 6.4 7.6 4.8 2.3 4.8 4.5 4.1 4.8 6.3

4. UNITED INTERNET - UTDI.DE 4Ot her 115

132

234

1. LANXESS - LXSG.DE 52. FUCHS PETROLUB AG - FPEG_p.DE 43. FRAPORT AG - FRAG.DE 4

3. BAYWA - BYWGnx.DE 164. AURUBIS - NAFG.DE 15Ot her 162

1. CELESIO - CLSGn.DE 222. TUI AG - TUIGn.DE 19

1.6 1.6 1.6 1.5 1.51.6 1.7 2.0 2.3 1.7 1.43.5 2.8 2.4 1.7 1.6 1.312.9 11.0

EV/ Operat ing Capit al 1.2 1.7 1.9 2.2 2.713.0 11.9 19.0 11.5 13.1 14.116.1 20.9 18.1 10.3 11.2 13.010.9 13.0 11.8 14.7 18.4 25.3EV/ EBIT 12.8 10.9

8.1 7.4 8.0 8.7 8.3 7.66.0 6.1 6.8 8.0 9.1 7.54.6 8.2 10.2 12.0 7.9 8.10.8

EV/ EBITDA 2.4 3.3 3.5 3.80.7 0.6 0.7 0.7 0.8 0.80.7 0.5 0.6 0.7 0.7 0.90.2 0.3 0.6 0.8 0.9 0.8

157 174 178 167EV/ Sales 0.1 0.2 0.2

53 99 143 129 109 14018 32 32 30 23 34126

Ent erpr ise Value (EUR bn) 1 2 3 3 4 1395 78 107 118 126 13221 16 26 43 83 1193 4 12 16 25 23Tot al market cap (EUR bn) 3 4 4

1.6 1.6 1.62.5 2.6 1.3 1.7 2.0 1.52.7 1.6 1.0 1.7 1.8 1.92.2 2.0 1.8 3.1 2.8 3.52.4 2.3 2.2 2.5 2.8

Aggregat ions are based on DB covered stocks. Data is calendarised and non-weighted.

Price/ BV (x) 2.13.5 3.3 3.5 2.7 2.7 0.71.9 2.0 1.6 1.8 1.3 1.2

2.6Dividend cover (x) 0.7 0.9 1.0 1.3 1.8

1.9 2.3 2.3 2.2 2.1 2.31.8 2.5 2.1 1.9 1.8 1.83.2 2.7 2.2 1.8 1.3 1.7Dividend yield (%) 5.5 4.7 4.9

9.0 8.811.6 9.0 5.5 9.0 10.4 11.210.8 6.7 5.0 6.9 9.0 12.35.3 4.5 7.6 15.9 14.0 28.0371.5 -2.3 -5.1 26.2 28.6

P/ CFPS (x) 5.4 7.6241.2 31.8 31.9 1.4 -18.2 -80.630.5 6.1 3.7 -9.7 -29.8 -40.0

28.6

German Small and Mid caps Tot al FD Earnings Growt h (%) -39.7 23.3 11.7 -18.4 42.8-17.6 -71.8 376.6 -3.9 -6.3 26.5-28.0 -43.0 230.2 30.3 33.0 0.3-18.8 42.8 31.8 7.2 5.2 -8.4FD EPS growt h (%) -39.7 23.3 11.5

61.4 17.9 19.6 21.6 17.9 13.833.4 13.6 15.5 16.0 20.5 19.020.2 23.9 28.8 48.2 31.7 42.015.1 22.9

NA P/ E rat io FD (x) 24.7 24.4 21.0 23.633.8 -14.3 -65.1 161.1 0.8 -6.88.2 -6.6 -24.6 50.1 44.9 -10.122.8 -20.2 40.6 40.7 15.0 18.8

162.5 -0.2 -7.4 15.2 22.9Tot al Headline Earnings Growt h (%) -39.2 28.0

45.0 42.0 -12.6 31.3 -13.8 -61.842.2 16.4 17.0 7.6 -9.1 -26.113.8

Industry Aggregat ion Headline EPS growt h (%) -39.2 28.0 22.6 -20.6 40.614.5 29.8 15.6 16.7 18.7 17.119.5 15.4 14.0 12.9 17.4 17.320.8 18.1 21.1 23.4 33.5 20.8

108 108 101Germany SM E P/ E rat io Headline (x) 24.4 23.2 18.1

70 80 94 101 103 1079 17 21 27 35 521 1 1 1 2 3Equity Research SUMMARY

Number of companies 1

-20

-15

-10

-5

0

5

10

15

20

25

93 95 97 99 01 03 05 07 09 11 13E

Margin Trends (%)

Sales growth (%)

Op. EBITDA/sales (%)

0

2

4

6

8

10

12

14

16

18

93 95 97 99 01 03 05 07 09 11 13E

Return Ratios (%)

ROE (%)

Return on Capital (%)

Operating Return on Capital (%)

-40

-20

0

20

40

60

80

100

-5

0

5

10

15

20

25

30

35

40

93 95 97 99 01 03 05 07 09 11 13E

Avg. Net Debt (Cash)/Equity

Net debt/(cash) (EUR bn)

Net debt/equity (%)

CLSGn.DE (9.5%)

TUIGn.DE (8.2%)

BYWGnx.DE (6.8%)

NAFG.DE (6.3%)

Other (69.2%)

LXSG.DE (3.4%)

FPEG_p.DE (3.4%)FRAG.DE

(3.1%)UTDI.DE (2.9%)

Other (87.2%)

-100% -50% 0% 50% 100% 150%

Price Gainers & Losers

SKY DEUTSCHLAND - SKYDn.DE (118.0%)

KUKA AG - KU2G.DE (109.0%)

DUERR - DUEG.DE (74.9%)

YOC AG - YOCG.DE (-58.6%)

GIGASET AG - GGS.DE (-61.9%)

CENTROTHERM PV - CTNG.DE (-88.1%)


Mad

e in G

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y Sp

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9 A

pril 2

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3

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Figure 95: European (ex Germany) SME equity universe covered by Deutsche Bank (ex-financials) (including stocks with a market capitalisation <E5bn)

Model updat ed: 05 April 2013 Year Ending 31 December 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E

INCOME STATEMENT (EUR bn)Sales revenue 54 56 60 73 110 132 150 209 281 290 310 379 464 577 740 795 790 889 990 1,061 1,061 1,080Operat ing EBITDA 10 6 6 7 14 17 20 29 35 38 41 54 66 84 98 94 91 116 119 122 131 141Depreciat ion 3 3 3 3 6 7 7 10 13 13 15 18 22 26 30 35 38 40 43 48 47 48Amort isat ion 0 0 0 0 0 0 1 2 4 3 3 2 1 3 5 8 7 6 8 6 5 5EBIT 7 3 3 4 7 10 13 17 18 22 25 35 42 57 65 49 45 70 69 69 78 88Net int erest income (expense) -1 -1 -1 -1 -2 -2 -2 -4 -6 -5 -5 -6 -7 -9 -12 -16 -15 -17 -18 -21 -21 -19Associat es/ af f iliat es 0 0 0 0 0 0 0 0 0 0 0 1 0 1 2 2 1 1 1 1 1 1Invest ment and ot her income/ expens 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 -3 -2 -1 -1 0 0 0Except ionals/ ext raordinaries 0 -1 0 0 -1 0 1 4 -8 -12 0 1 5 7 4 -12 -5 6 -3 -3 1 2Income t ax expense 0 1 1 1 2 3 3 5 5 6 6 9 11 12 15 11 8 13 13 15 16 19Minorit ies/ pref erence dividends 0 0 0 0 0 0 0 0 0 0 0 1 1 2 3 1 2 3 3 4 4 4Net income 6 1 2 2 3 6 8 13 -2 -3 14 20 28 42 43 8 16 45 36 29 40 49

CASH FLOW (EUR bn)Cash f low f rom operat ions 4 5 4 7 10 12 16 15 23 27 27 37 41 52 63 64 78 83 84 83 88 96Movement in net working capit al 1 0 -1 0 1 1 2 -3 2 2 -2 -1 -3 -4 -4 -4 12 -2 -2 -3 -3 -4Capex -3 -4 -4 -4 -7 -12 -14 -26 -21 -17 -19 -22 -30 -47 -49 -59 -54 -59 -66 -70 -65 -61Free cash f low 0 1 1 2 3 0 2 -11 3 10 8 15 10 5 14 5 24 24 18 12 23 35Ot her invest ing act ivit ies 0 -1 1 0 0 -2 -1 -21 -2 2 2 -6 -9 -8 -19 -6 8 1 -4 -3 6 3Equit y raised/ (bought back) 0 1 0 0 1 2 2 6 3 0 1 0 -1 1 6 -1 11 8 3 3 0 -1Dividends paid 0 0 -1 0 -2 -2 -3 -4 -4 -5 -5 -8 -10 -22 -19 -18 -15 -13 -17 -20 -16 -17Net inc/ (dec) in borrowings -1 0 0 0 0 3 4 19 3 -11 -3 -2 2 7 17 11 -3 -5 5 10 -4 -5Ot her f inancing cash f lows 0 0 0 0 -1 1 0 -1 0 0 0 1 1 8 -1 -4 -10 0 -9 -9 -2 -2Tot al cash f lows f rom f inancing -1 1 0 0 -1 5 3 21 1 -16 -8 -9 -8 -8 3 -11 -16 -9 -19 -16 -23 -25Net cash f low -1 2 1 2 1 2 4 -12 2 -4 2 -1 -6 -10 -2 -13 16 17 -3 -7 6 13Movement in net debt / (cash) 0 -1 -1 -2 -1 1 0 31 1 -7 -5 -1 8 17 19 24 -18 -21 9 17 -10 -18

Revenues Calenderised 2013 (EUR bn) BALANCE SHEET (EUR bn)Cash and ot her liquid asset s 2 4 8 9 14 15 22 23 31 24 31 44 49 59 74 83 109 130 131 131 129 128Tangible f ixed asset s 27 30 31 37 59 65 79 100 127 129 144 182 215 267 320 357 382 425 468 491 503 491Goodwill 1 1 1 3 3 5 10 41 35 34 32 39 54 68 98 107 110 114 126 121 119 115Ot her int angible asset s 1 2 1 1 2 3 4 13 18 12 13 19 32 45 69 82 96 104 126 137 139 136Associat es/ invest ment s 3 4 4 4 10 8 14 17 19 15 15 18 17 50 59 60 71 80 88 91 85 84

Tot al Ot her asset s 23 27 30 36 43 40 62 84 111 103 115 151 189 235 307 319 325 381 389 402 403 399Tot al asset s 58 67 74 90 132 136 191 278 340 317 351 453 556 725 928 1,008 1,093 1,234 1,328 1,372 1,377 1,354Int erest bearing debt 14 15 18 22 34 38 49 89 132 118 125 147 156 207 271 334 355 382 402 422 410 379Ot her liabilit ies 20 25 27 32 57 54 81 102 109 110 121 155 217 283 352 377 405 456 498 512 509 498Tot al liabilit ies 34 39 45 54 91 91 131 191 242 228 246 302 373 490 622 710 760 838 900 934 920 877Shareholders' equit y 23 26 27 34 48 53 68 93 108 100 114 145 180 234 292 279 315 377 397 414 438 458Minorit ies 1 2 2 2 3 3 3 6 4 3 4 7 8 11 19 20 18 21 27 28 28 29Tot al shareholders' equit y 24 27 29 36 51 55 71 99 111 103 118 152 188 245 311 299 334 398 423 442 467 487Net working capit al 6 6 7 9 5 7 4 9 36 32 34 33 20 19 30 24 17 30 5 8 10 16Net debt (cash) 11 11 10 12 20 23 27 66 101 94 94 103 107 148 196 251 246 253 271 291 281 251Capit al 35 38 40 48 71 78 99 165 212 197 212 255 294 393 507 549 580 651 695 732 747 738

RATIO ANALYSISSales growt h (%) -0.8 2.0 0.7 16.5 23.9 9.6 11.6 19.3 11.7 2.0 -1.0 6.8 7.0 6.0 8.0 1.1 -10.5 9.9 9.8 6.2 2.6 3.7Op. EBITDA/ sales (%) 17.9 11.3 10.6 10.0 12.4 13.3 13.6 14.0 12.4 13.1 13.3 14.2 14.2 14.5 13.3 11.8 11.5 13.1 12.1 11.5 12.3 13.0EBIT/ sales (%) 13.3 6.2 5.6 5.3 6.6 7.9 8.3 8.3 6.4 7.6 7.9 9.1 9.1 9.8 8.7 6.2 5.6 7.9 7.0 6.5 7.4 8.1Payout rat io (%) 8 56 75 56 96 54 47 39 nm nm 45 43 39 78 42 196 89 42 52 59 43 38

Market Capit alizat ion - Current (EUR bn) ROE (%) 25.3 5.5 6.3 5.7 6.4 10.5 13.7 15.2 -1.8 -2.6 12.0 14.4 16.5 18.9 15.0 2.6 5.1 12.7 9.2 7.2 9.4 11.0Ret urn on Capit al (%) 20.0 5.9 6.6 5.8 6.4 9.2 11.4 11.9 2.1 -1.4 8.3 10.2 12.1 13.9 11.4 2.9 4.6 9.5 7.5 6.3 7.7 8.9Operat ing Ret urn on Capit al (%) 20.0 6.7 6.2 6.0 8.0 10.0 11.0 10.1 9.8 -0.3 8.6 10.6 11.1 13.3 11.4 4.5 5.6 9.0 7.9 6.8 8.1 9.1Capex/ sales (%) 6.3 7.3 6.1 6.1 6.5 9.2 9.3 12.6 7.4 5.7 6.2 5.9 6.5 8.1 6.7 7.4 6.9 6.6 6.6 6.6 6.1 5.7Capex/ depreciat ion (x) 1.4 1.4 1.2 1.3 1.2 1.8 1.9 2.6 1.5 1.2 1.3 1.2 1.3 1.7 1.5 1.6 1.3 1.3 1.4 1.4 1.3 1.2Net debt / equit y (%) 47.4 38.9 35.9 34.3 38.8 41.0 38.6 66.9 91.1 91.3 79.6 67.9 56.9 60.3 63.2 83.9 73.6 63.5 64.0 65.8 60.2 51.6

Tot al Net int erest cover (x) 6.1 3.4 3.1 3.9 4.8 6.1 6.6 4.7 3.1 4.1 4.8 5.9 5.8 6.6 5.3 3.1 3.1 4.2 3.8 3.3 3.8 4.6

4. REXAM - REX.L 4.88Ot her 570

590

1,061

1. ZODIAC - ZODC.PA 4.972. FIAT - FIA.MI 4.963. BUNZL - BNZL.L 4.96

3. AIR FRANCE-KLM - AIRF.PA 264. DELHAIZE - DELB.BR 23Ot her 869

1. FIAT - FIA.MI 862. PEUGEOT SA - PEUP.PA 57

1.3 1.3 1.2 1.2 1.23.4 3.5 3.6 3.0 1.4 1.23.2 2.3 2.0 1.3 1.3 2.611.7 10.0

EV/ Operat ing Capit al 1.7 1.8 2.1 2.5 2.323.9 16.0 15.6 12.1 13.0 13.015.9 11.7 22.5 25.3 24.2 25.325.1 31.3 22.9 24.0 18.2 18.6EV/ EBIT 8.5 19.8

7.7 7.3 7.5 7.3 7.0 6.213.5 16.2 15.5 17.1 15.7 8.412.3 14.3 11.1 11.0 8.2 6.80.8

EV/ EBITDA 6.3 10.9 13.3 16.41.0 0.9 0.9 0.9 0.8 0.90.9 1.8 2.3 2.2 2.5 2.11.6 1.5 1.9 1.5 1.5 1.0

898 894 912 875EV/ Sales 1.1 1.2 1.4

1,026 1,433 1,544 787 695 845227 324 285 257 555 874586

Ent erpr ise Value (EUR bn) 61 69 84 121 167 250507 421 566 578 562 590180 478 784 915 1,283 1,314108 148 225 196 257 206Tot al market cap (EUR bn) 51 60 74

1.4 1.4 1.32.5 2.1 1.2 1.6 1.7 1.32.4 1.9 1.5 1.6 1.9 2.21.0 1.6 2.5 2.5 2.9 3.72.4 1.9 1.7 2.3 2.6

Aggregat ions are based on DB covered stocks. Data is calendarised and non-weighted.

Price/ BV (x) 1.12.3 2.6 1.3 2.4 0.5 1.11.8 2.1 2.6 -0.3 -0.6 2.2

3.2Dividend cover (x) 12.3 1.8 1.3 1.8 1.0

3.0 3.3 3.4 3.2 3.0 2.92.6 1.3 1.1 1.2 2.5 1.40.9 2.0 1.3 2.0 2.0 2.8Dividend yield (%) 0.9 1.3 1.7

6.7 6.120.7 7.9 5.4 6.8 6.9 6.88.9 6.7 17.6 21.2 22.5 24.617.8 16.5 15.1 18.6 12.3 17.1183.8 -19.8 -20.0 43.3 25.3

P/ CFPS (x) 13.2 11.726.8 22.5 31.0 -5.0 -86.9 99.260.7 37.1 25.8 nm -32.0 nm

25.3

Europe (ex GER) small and mid capsTot al FD Earnings Growt h (%) 252.8 -76.7 13.2 -10.3 -7.5

-84.4 116.0 179.9 -19.0 -17.7 43.4nm nm 27.2 20.5 32.2 -7.5-13.1 5.1 61.4 29.2 78.3 nmFD EPS growt h (%) 241.7 -78.2 11.926.9 12.6 16.1 19.3 14.8 11.935.1 38.7 32.3 30.7 30.5 65.348.9 40.8 23.1 19.9 nm nm

-29.1 20.2NA P/ E rat io FD (x) 9.2 43.5 43.3 60.0

13.2 -35.8 -28.4 78.0 1.6 39.4-19.5 22.0 17.3 4.3 2.0 22.2-6.0 -3.3 -11.9 94.4 21.5 6.685.9 1.3 41.1 -29.0 20.2

Tot al Headline Earnings Growt h (%) 243.7 -73.64.1 0.9 22.3 13.0 -35.3 -27.794.0 10.2 57.0 -24.2 23.7 16.2

12.2

Industry Aggregat ion Headline EPS growt h (%) 233.1 -75.1 -7.4 -10.1 1.016.7 19.0 13.9 13.9 9.6 14.513.4 28.3 38.2 37.1 36.6 30.756.0 52.1 36.1 23.0 22.6 18.7

304 301 292Europe SM E (ex-Germany) P/ E rat io Headline (x) 8.8 37.1 44.3

196 228 258 273 286 29973 91 95 109 131 16322 27 33 39 46 54Equity Research SUMMARY

Number of companies 21

-15

-10

-5

0

5

10

15

20

25

30

93 95 97 99 01 03 05 07 09 11 13E

Margin Trends (%)

Sales growth (%)

Op. EBITDA/sales (%)

-10

-5

0

5

10

15

20

25

30

93 95 97 99 01 03 05 07 09 11 13E

Return Ratios (%)

ROE (%)

Return on Capital (%)

Operating Return on Capital (%)

0

10

20

30

40

50

60

70

80

90

100

0

50

100

150

200

250

300

350

93 95 97 99 01 03 05 07 09 11 13E

Avg. Net Debt (Cash)/Equity

Net debt/(cash) (EUR bn)

Net debt/equity (%)

FIA.MI (8.1%)

PEUP.PA (5.4%)

AIRF.PA (2.5%)

DELB.BR (2.2%)

Other (81.9%)

ZODC.PA (.8%)FIA.MI (.8%)BNZL.L (.8%)REX.L (.8%)

Other (96.6%)

-200% 0% 200% 400% 600% 800%

Price Gainers & Losers

AFRICA OIL - AOIC.ST (674.5%)

888 - 888.L (153.7%)

OPHIR ENERGY - OPHR.L (114.6%)

KPN - KPN.AS (-66.8%)

OTMT - OTMTq.L (-69.0%)

AQUARIUS PLATINUM LIMITED - AQP.L (-70.2%)


9 April 2013



Appendix B

Q1 2013 reporting calendar

Figure 96: Q1 2013 reporting calendar among German SMEs Market Cap DB IBES No.

Expected Expected Period (in Eur bn) Price Target DB Cons.est. of ICB

Company name Date Time (CET) of reporting 05 Apr 13 05 Apr 13 Currency Price Rec Q1 EPS est. Sector

Gerresheimer 10 Apr 2013 07:30 Q1 2013 1.3 42.8 EUR 43.0 H Health Care

R Stahl Ag 10 Apr 2013 Y 2012 0.2 30.1 EUR NA Industrial Goods & Services

Bauer AG 11 Apr 2013 Y 2012 0.3 19.2 EUR 18.0 H Construction & Materials

SinnerSchrader 11 Apr 2013 Q2 2013 0.0 1.7 EUR NA H Technology

Wilex Ag 11 Apr 2013 Q1 2013 0.0 1.6 EUR NA Health Care

FJH 12 Apr 2013 Y 2012 0.0 0.9 EUR 4.7 H Technology

November Ag 12 Apr 2013 S1 2012 0.0 0.0 EUR NA Health Care

Agennix Ag 12 Apr 2013 Y 2012 0.0 0.3 EUR NA Health Care

Jk Wohnbau Ag 15 Apr 2013 Y 2012 0.1 3.0 EUR NA Personal & Household Goods

United Labels 15 Apr 2013 Y 2012 0.0 1.0 EUR NA Retail

Ultrasonic Ag 15 Apr 2013 Y 2012 0.1 9.9 EUR NA Personal & Household Goods

Ahlers 15 Apr 2013 Q1 2013 0.2 11.5 EUR NA H Personal & Household Goods

Haikui Seafood A 17 Apr 2013 Y 2012 0.1 8.0 EUR NA Food & Beverage

Curanum AG 17 Apr 2013 Q1 2013 0.1 2.7 EUR NA Health Care

Wirecard 17 Apr 2013 Y 2012 2.3 20.2 EUR 16.0 H 0.2 3 Industrial Goods & Services

Stratec 18 Apr 2013 Bef-mkt Y 2012 0.4 34.0 EUR 32.0 H Health Care

BB BIOTECH 18 Apr 2013 Q1 2013 1.2 99.6 CHF 106.5 B Health Care

Invision Ag 18 Apr 2013 Q1 2013 0.0 15.1 EUR NA Technology

Deufol Se 18 Apr 2013 23:59 Y 2012 0.0 1.0 EUR NA Industrial Goods & Services

United Power Tec 18 Apr 2013 Y 2012 0.0 3.7 EUR NA Industrial Goods & Services

Ludwig Beck 19 Apr 2013 Q1 2013 0.1 30.0 EUR NA Retail

Syzygy 19 Apr 2013 Y 2012 0.1 4.4 EUR NA Technology

Teles 22 Apr 2013 Q1 2013 0.0 0.4 EUR NA Technology

Zooplus AG 22 Apr 2013 Q1 2013 0.3 40.7 EUR 50.0 B Personal & Household Goods

Electrawinds Se 23 Apr 2013 Y 2012 0.4 6.3 EUR NA Financial Services

Schaltbau Holding Ag 23 Apr 2013 Q1 2013 0.2 31.0 EUR NA H Industrial Goods & Services

Mevis Medical So 23 Apr 2013 Y 2012 0.0 9.0 EUR NA Technology

Hess Ag 23 Apr 2013 Y 2012 0.0 0.6 EUR NA Construction & Materials

Sartorius 23 Apr 2013 Q1 2013 1.5 84.4 EUR 47.0 B Industrial Goods & Services

Geratherm 24 Apr 2013 Y 2012 0.0 5.3 EUR NA Health Care

Intica Systems 24 Apr 2013 Y 2012 0.0 3.1 EUR NA Technology

Krones 24 Apr 2013 Q1 2013 1.7 54.3 EUR 38.0 H 0.9 4 Industrial Goods & Services

Wincor Nixdorf 24 Apr 2013 Q2 2013 1.2 36.7 EUR 50.0 B Technology

Intelligence 24 Apr 2013 Q1 2013 0.3 10.9 EUR NA Technology

MTU 25 Apr 2013 Q1 2013 3.7 71.4 EUR 78.0 B Industrial Goods & Services

Praktiker 25 Apr 2013 Q1 2013 0.1 1.1 EUR 2.6 B Retail

GRENKE Group 25 Apr 2013 Q1 2013 0.8 56.5 EUR 47.0 H Industrial Goods & Services

Vita 34 Ag 25 Apr 2013 Q1 2013 0.0 2.9 EUR NA Health Care

Fielmann 25 Apr 2013 Q1 2013 3.1 73.3 EUR 60.0 S 0.7 5 Retail

Kontron AG 25 Apr 2013 Q1 2013 0.2 4.2 EUR 3.7 H Industrial Goods & Services

Rhoen Klinikum 25 Apr 2013 Q1 2013 2.2 16.1 EUR 16.6 H Health Care

Vtion Wirelss Te 25 Apr 2013 Y 2012 0.1 4.3 EUR NA Technology

Amadeus 25 Apr 2013 Q1 2013 0.2 41.1 EUR NA NR Industrial Goods & Services

ADVA 25 Apr 2013 Q1 2013 0.2 3.7 EUR 4.5 H Technology

PUMA SE 25 Apr 2013 Q1 2013 3.5 231.1 EUR 225.0 H Personal & Household Goods

Software AG 25 Apr 2013 Q1 2013 2.4 27.8 EUR 38.0 B Technology

comdirect 25 Apr 2013 Q1 2013 1.1 8.1 EUR 9.0 B Financial Services

Vossloh 25 Apr 2013 Q1 2013 1.1 79.0 EUR 70.0 H Industrial Goods & Services

Delticom AG 25 Apr 2013 Q1 2013 0.4 35.8 EUR 28.0 S Automobiles & Parts

Qiagen 25 Apr 2013 Q1 2013 3.8 20.5 USD 21.5 B 0.2 4 Health Care

Source: Bloomberg Finance LP, Deutsche Bank

9 April 2013



Figure 97: Q1 2013 reporting calendar among German SMEs (contd’) Market Cap DB IBES No.



AIXTRON 26 Apr 2013 Q1 2013 1.1 11.3 EUR 14.0 B -0.1 4 Technology

AEG Power Solutions 26 Apr 2013 Q1 2013 0.0 0.6 EUR NA Industrial Goods & Services

SGL Group SE 26 Apr 2013 Q1 2013 2.1 30.3 EUR 30.0 H Industrial Goods & Services

Zhongde Waste Te 29 Apr 2013 Y 2012 0.0 1.7 EUR NA Industrial Goods & Services

Höft & Wessel 29 Apr 2013 Y 2012 0.0 1.7 EUR NA Industrial Goods & Services

PSI AG 29 Apr 2013 Q1 2013 0.2 15.5 EUR 18.0 B Technology

Envitec Biogas 30 Apr 2013 Y 2012 0.1 7.4 EUR NA Industrial Goods & Services

Takkt 30 Apr 2013 Q1 2013 0.8 12.8 EUR 12.0 H Retail

Adc African Deve 30 Apr 2013 Y 2012 0.1 9.3 EUR NA Financial Services

Powerland Ag 30 Apr 2013 Y 2012 0.1 6.7 EUR NA Personal & Household Goods

Wacker Chemie AG 30 Apr 2013 Q1 2013 2.9 55.4 EUR 37.0 S Chemicals

DAB bank 30 Apr 2013 Q1 2013 0.3 3.5 EUR 3.5 H Financial Services

Fantastic Co Agf 30 Apr 2013 Y 2012 0.0 0.0 EUR NA Financial Services

Nemetschek AG 30 Apr 2013 Q1 2013 0.4 44.9 EUR NA Technology

YOC AG 30 Apr 2013 Y 2012 0.0 6.9 EUR NA H Media

Surteco AG 30 Apr 2013 Y 2012 0.2 18.7 EUR NA Personal & Household Goods

Artnet Ag - Reg 30 Apr 2013 Y 2012 0.0 2.7 EUR NA Retail

Vectron Systems AG 30 Apr 2013 Y 2012 0.1 3.0 EUR NA Chemicals

C.A.T. oil 30 Apr 2013 Y 2012 0.4 8.0 EUR 9.5 B Oil & Gas

China Specialty 30 Apr 2013 Y 2012 0.0 1.9 EUR NA Construction & Materials

RIB Software AG 30 Apr 2013 Q1 2013 0.2 4.3 EUR NA Technology

Travel24.Com 02 May 2013 Y 2012 0.0 13.0 EUR NA Technology

SFC Energy AG 02 May 2013 Q1 2013 0.0 5.3 EUR 12.0 B Oil & Gas

Villeroy & Boch 02 May 2013 Q1 2013 0.2 8.3 EUR 7.0 H Construction & Materials

RealTech AG 02 May 2013 Q1 2013 0.0 5.3 EUR NA Technology

Fuchs Petrolub AG 02 May 2013 Q1 2013 4.4 59.3 EUR 46.0 H Chemicals

Draegerwerk AG 02 May 2013 Q1 2013 1.5 98.4 EUR 115.0 B Health Care

Elmos 03 May 2013 Aft-mkt Q1 2013 0.2 8.1 EUR 7.4 H Technology

Syskoplan 03 May 2013 Q1 2013 0.1 11.8 EUR NA Technology

A.S. Creation 03 May 2013 Q1 2013 0.1 42.6 EUR NA NR Personal & Household Goods

Morphosys 03 May 2013 Q1 2013 0.7 30.5 EUR 43.0 B Health Care

Dyckerhoff 03 May 2013 Q1 2013 1.8 43.6 EUR NA NR Construction & Materials

Compugroup Medical AG 03 May 2013 Q1 2013 0.9 16.2 EUR 23.0 B Technology

Eckert & Ziegler 03 May 2013 Q1 2013 0.2 28.2 EUR NA Chemicals

ROFIN-SINAR 03 May 2013 Q2 2013 0.6 25.8 USD 15.0 H 0.3 5 Industrial Goods & Services

Ruecker 06 May 2013 Q1 2013 0.1 15.8 EUR NA Automobiles & Parts

Augusta Technolo 06 May 2013 Q1 2013 0.2 24.0 EUR NA Technology

Hamborner AG 06 May 2013 Q1 2013 0.3 7.2 EUR NA Real Estate

Hypoport Ag 06 May 2013 Q1 2013 0.0 7.6 EUR NA Financial Services

Pfeiffer Vacuum 07 May 2013 07:30 Q1 2013 0.8 84.4 EUR 69.0 S 1.0 4 Industrial Goods & Services

Washtec AG 07 May 2013 Q1 2013 0.1 10.3 EUR NA H Industrial Goods & Services

Loewe AG 07 May 2013 Q1 2013 0.0 3.1 EUR NA H Personal & Household Goods

PATRIZIA Immobilien 07 May 2013 Q1 2013 0.4 7.1 EUR NA NR Real Estate

Balda AG 07 May 2013 Q3 2013 0.3 4.4 EUR NA Technology

CropEnergies 07 May 2013 Y 2013 0.5 6.0 EUR NA NR Oil & Gas

Norma Group AG 07 May 2013 Q1 2013 0.8 24.1 EUR 22.0 H Automobiles & Parts

Hawesko 07 May 2013 Q1 2013 0.4 42.7 EUR 40.0 H Retail

Basler 07 May 2013 Q1 2013 0.1 15.0 EUR NA S Industrial Goods & Services

Alstria 07 May 2013 Q1 2013 0.7 8.9 EUR 10.7 B Real Estate

Gildemeister AG 07 May 2013 Q1 2013 0.9 15.3 EUR NA H Industrial Goods & Services

Stada Arzneimittel AG 07 May 2013 Q1 2013 1.7 29.9 EUR 33.0 B Health Care

Axel Springer 07 May 2013 Q1 2013 3.3 33.7 EUR 42.0 H Media

Secunet 08 May 2013 Q1 2013 0.1 12.1 EUR NA Technology

Singulus Technologies 08 May 2013 Q1 2013 0.1 1.2 EUR 2.5 H Industrial Goods & Services

Prime Office 08 May 2013 Q1 2013 0.2 3.4 EUR 3.5 H Real Estate


9 April 2013






TAG Immobilien AG 08 May 2013 Q1 2013 1.1 8.7 EUR NA Real Estate

Dialog Semiconductor 08 May 2013 Q1 2013 0.7 11.0 EUR 15.0 H 0.2 6 Technology

Polis Immobilien 08 May 2013 Q1 2013 0.1 10.5 EUR NA Real Estate

KUKA AG 08 May 2013 Q1 2013 1.1 31.0 EUR 30.0 H 0.5 4 Industrial Goods & Services

Kloeckner & Co. 08 May 2013 Q1 2013 1.0 10.4 EUR 9.5 H Basic Resources

Deutz AG 08 May 2013 Q1 2013 0.5 3.9 EUR NA H 0.1 3 Industrial Goods & Services

Biotest 08 May 2013 Q1 2013 0.7 57.6 EUR NA S Health Care

ElringKlinger AG 08 May 2013 Q1 2013 1.4 22.5 EUR 21.0 H Automobiles & Parts

IVG Immobilien AG 08 May 2013 Q1 2013 0.1 0.6 EUR NA NR Real Estate

Analytik Jena 08 May 2013 Q2 2013 0.1 11.3 EUR NA Health Care

Masterflex 08 May 2013 Q1 2013 0.0 4.9 EUR NA Chemicals

Jenoptik 08 May 2013 Q1 2013 0.4 7.9 EUR 7.5 H Industrial Goods & Services

TePla 08 May 2013 Q1 2013 0.0 2.0 EUR NA Technology

Alphaform 08 May 2013 Q1 2013 0.0 2.9 EUR NA Industrial Goods & Services

GEA 08 May 2013 Q1 2013 4.9 25.5 EUR 30.0 B Industrial Goods & Services

Rheinmetall 08 May 2013 Q1 2013 1.4 35.3 EUR 31.0 S 1.8 3 Automobiles & Parts

Tomorrow Focus 08 May 2013 Q1 2013 0.2 4.1 EUR 4.0 H Media

Ovb Holding Ag 08 May 2013 Q1 2013 0.3 18.9 EUR NA Financial Services

Euromicron 08 May 2013 Q1 2013 0.1 15.6 EUR 17.0 H Industrial Goods & Services

Fair Value Reit 08 May 2013 Q1 2013 0.0 4.4 EUR NA Real Estate

Intershop Commun 08 May 2013 Q1 2013 0.1 1.9 EUR NA Technology

Fraport AG 08 May 2013 Q1 2013 4.0 43.1 EUR 52.0 B Industrial Goods & Services

SHW 08 May 2013 Q1 2013 0.2 33.5 EUR 34.0 B Automobiles & Parts

Manz AG 08 May 2013 Q1 2013 0.1 22.9 EUR NA NR Oil & Gas

Phoenix Solar AG 08 May 2013 Q1 2013 0.0 1.3 EUR NA NR Oil & Gas

Rational AG 08 May 2013 Q1 2013 2.6 229.3 EUR NA H Industrial Goods & Services

Epigenomics Ag 08 May 2013 Q1 2013 0.0 1.8 EUR NA Health Care

Mybet Holding Se 08 May 2013 Q1 2013 0.0 1.5 EUR NA Travel & Leisure

Pulsion Medical Systems 08 May 2013 Q1 2013 0.1 15.7 EUR NA Health Care

GFT Technologies 08 May 2013 Q1 2013 0.1 3.4 EUR NA NR Technology

Jungheinrich 08 May 2013 Q1 2013 1.1 31.7 EUR 32.0 B Industrial Goods & Services

Telegate AG 08 May 2013 Q1 2013 0.2 8.1 EUR NA NR Industrial Goods & Services

Suess Microtec AG 08 May 2013 Q1 2013 0.2 9.1 EUR 9.0 H Industrial Goods & Services

Freenet AG 08 May 2013 Q1 2013 2.3 18.4 EUR 17.0 B Telecommunications

Grammer 08 May 2013 Q1 2013 0.2 20.4 EUR NA NR Automobiles & Parts

Tom Tailor 08 May 2013 Q1 2013 0.4 17.3 EUR 19.0 B Retail

Duerr 08 May 2013 Q1 2013 1.4 79.1 EUR 95.0 B Industrial Goods & Services

Logwin 09 May 2013 Q1 2013 0.2 1.0 EUR NA NR Industrial Goods & Services

Symrise 09 May 2013 Q1 2013 3.6 30.6 EUR 29.0 H Chemicals

Douglas 09 May 2013 Q2 2013 1.5 38.0 EUR 38.0 H Retail

Kromi Logistik A 09 May 2013 Q3 2013 0.0 9.0 EUR NA Industrial Goods & Services

Solar-Fabrik AG 10 May 2013 Q1 2013 0.0 2.1 EUR NA Oil & Gas

SMARTRAC 10 May 2013 Q1 2013 0.2 10.6 EUR NA NR Technology

Petrotec Ag 10 May 2013 Q1 2013 0.0 1.0 EUR NA Oil & Gas

Drillisch Group 10 May 2013 Q1 2013 0.7 14.0 EUR NA Telecommunications

4Sc Ag 10 May 2013 Q1 2013 0.1 1.7 EUR NA Health Care

Nexus 10 May 2013 Q1 2013 0.1 8.8 EUR NA Technology

Articon-Integralis 10 May 2013 Q1 2013 0.1 8.1 EUR NA Technology

INIT Innovation In Traffic 10 May 2013 Q1 2013 0.2 23.1 EUR NA Technology

AD pepper Media 10 May 2013 Q1 2013 0.0 0.9 EUR NA Media

WESTAG&GET. AG 10 May 2013 Q1 2013 0.1 17.6 EUR NA Construction & Materials

Verbio AG 12 May 2013 Q3 2013 0.1 1.2 EUR NA Oil & Gas

ATOSS 13 May 2013 Q1 2013 0.1 30.9 EUR NA Technology

Lotto24 13 May 2013 Q1 2013 0.1 3.9 EUR NA Travel & Leisure

Estavis Ag 13 May 2013 Q3 2013 0.0 2.0 EUR NA Real Estate


9 April 2013



Figure 99: Q1 2013 reporting calendar among German SMEs (contd’) Market Cap DB IBES No.



Baywa Ag 13 May 2013 Q1 2013 1.2 40.7 EUR NA Food & Beverage

CEWE COLOR 13 May 2013 Q1 2013 0.2 32.9 EUR 38.0 B Retail

QSC AG 13 May 2013 Q1 2013 0.3 2.4 EUR 2.8 B Technology

Plambeck 13 May 2013 Q1 2013 0.1 2.3 EUR 25.5 B Utilities

Palm Hills Developments 14 May 2013 Q1 2013 0.0 1.8 EUR NA Oil & Gas

Celesio 14 May 2013 Q1 2013 2.5 14.6 EUR 13.5 H Retail

HHLA 14 May 2013 Q1 2013 1.2 17.2 EUR 17.0 H 0.2 5 Industrial Goods & Services

Bilfinger SE 14 May 2013 Q1 2013 3.6 78.1 EUR 82.0 H Industrial Goods & Services

XING AG 14 May 2013 Q1 2013 0.2 39.5 EUR 50.0 H Technology

Bechtle 14 May 2013 Q1 2013 0.8 35.9 EUR 33.0 H Technology

LEONI 14 May 2013 Q1 2013 1.0 29.6 EUR 27.0 H Industrial Goods & Services

Evotec 14 May 2013 Q1 2013 0.3 2.2 EUR 2.6 H Health Care

Adlink Internet 14 May 2013 Q1 2013 0.1 1.8 EUR NA Media

Aurubis 14 May 2013 Q2 2013 2.1 46.4 EUR 58.0 H Basic Resources

CENIT 14 May 2013 Q1 2013 0.1 9.5 EUR NA Technology

Technotrans 14 May 2013 Q1 2013 0.1 8.8 EUR NA Industrial Goods & Services

Quanmax AG 14 May 2013 Q1 2013 0.1 2.2 EUR NA Retail

VBH Holding AG 14 May 2013 Q1 2013 0.1 2.6 EUR NA H Personal & Household Goods

Asian Bamboo-Br 14 May 2013 Q1 2013 0.1 3.8 EUR NA Basic Resources

Centrotec Hochleistungssto 14 May 2013 Q1 2013 0.3 15.1 EUR NA Oil & Gas

Tipp24 14 May 2013 Q1 2013 0.3 41.3 EUR 50.0 B Travel & Leisure

Deutsche Wohnen 14 May 2013 Q1 2013 2.2 13.7 EUR 15.5 H Real Estate

ALL FOR ONE MIDMARKE 14 May 2013 Q2 2013 0.1 14.4 EUR NA Technology

Wacker Neuson SE 14 May 2013 Q1 2013 0.8 11.2 EUR 10.0 H Industrial Goods & Services

H&R AG 14 May 2013 Q1 2013 0.3 9.5 EUR NA Chemicals

LPKF 15 May 2013 08:00 Q1 2013 0.2 19.3 EUR NA S Industrial Goods & Services

Nordex 15 May 2013 Q1 2013 0.4 5.1 EUR 3.0 H Oil & Gas

DIC Asset AG 15 May 2013 Q1 2013 0.3 7.3 EUR NA NR Real Estate

Paragon Ag 15 May 2013 Q1 2013 0.0 8.2 EUR NA Industrial Goods & Services

3U O.N. 15 May 2013 Q1 2013 0.0 0.5 EUR NA Telecommunications

Mifa Mitteldeuts 15 May 2013 Q1 2013 0.1 6.6 EUR NA Personal & Household Goods

Deutsche EuroShop 15 May 2013 Q1 2013 1.7 30.7 EUR 33.0 H Real Estate

Adler Modemarkte 15 May 2013 Q1 2013 0.1 6.8 EUR NA Retail

Softing 15 May 2013 Q1 2013 0.0 7.4 EUR NA Technology

Joyou Ag 15 May 2013 Q1 2013 0.3 11.0 EUR NA Construction & Materials

GfK 15 May 2013 Q1 2013 1.5 40.3 EUR 39.5 H Media

Advanced Vision 15 May 2013 Q1 2013 0.0 5.8 EUR NA Industrial Goods & Services

Carl Zeiss Meditec 15 May 2013 Q2 2013 1.9 23.2 EUR 22.5 H Health Care

TUI AG 15 May 2013 Q2 2013 2.0 7.8 EUR 10.3 B Travel & Leisure

AAP Implantate 15 May 2013 Q1 2013 0.0 1.4 EUR NA Health Care

Skw Stahl-Metall 15 May 2013 Q1 2013 0.1 12.4 EUR NA Basic Resources

Mobotix Ag 15 May 2013 Q2 2013 0.2 16.0 EUR NA Industrial Goods & Services

Smt Scharf Ag 15 May 2013 Q1 2013 0.1 24.8 EUR NA Industrial Goods & Services

SMA 15 May 2013 Q1 2013 0.6 18.2 EUR 25.0 B Oil & Gas

Mologen Ag 15 May 2013 Q1 2013 0.2 13.4 EUR NA Health Care

Mediclin 15 May 2013 Q1 2013 0.2 4.0 EUR NA NR Health Care

Muehlbauer 15 May 2013 Q1 2013 0.3 21.2 EUR NA Technology

Ecotel Communica 15 May 2013 Q1 2013 0.0 5.5 EUR NA Telecommunications

HWAG 15 May 2013 Q1 2013 0.2 3.8 EUR NA Financial Services

MVV Energie AG 15 May 2013 Q2 2013 1.5 22.8 EUR 19.0 H Utilities

Cancom Ag 15 May 2013 Q1 2013 0.2 14.8 EUR NA Technology

Sky Deutschland 15 May 2013 Q1 2013 3.4 3.9 EUR 4.5 H Media

Bertrandt AG 15 May 2013 Q2 2013 0.9 85.5 EUR 75.0 H Industrial Goods & Services

Gigaset AG 15 May 2013 Q1 2013 0.0 0.9 EUR 1.2 H Technology

OHB Teledata 15 May 2013 Q1 2013 0.3 16.1 EUR NA Technology


9 April 2013






Sygnis Pharma Ag 15 May 2013 Q1 2013 0.0 2.6 EUR NA Health Care

Koenig & Bauer AG 15 May 2013 Q1 2013 0.3 17.1 EUR 12.0 H Industrial Goods & Services

MLP 15 May 2013 Q1 2013 0.6 5.3 EUR NA NR Financial Services

Salzgitter 15 May 2013 Q1 2013 1.8 30.6 EUR 36.0 H Basic Resources

Data Modul AG 15 May 2013 Q1 2013 0.1 15.9 EUR NA Industrial Goods & Services

Stroeer 15 May 2013 Q1 2013 0.3 8.1 EUR 12.5 B Media

Air Berlin 15 May 2013 Q1 2013 0.2 2.1 EUR 3.5 B Travel & Leisure

Conergy Ag 15 May 2013 Q1 2013 0.1 0.4 EUR NA Oil & Gas

GAGFAH 15 May 2013 Q1 2013 1.9 9.0 EUR 8.0 H Real Estate

Medigene 16 May 2013 Q1 2013 0.0 0.9 EUR NA Health Care

VTG AG 16 May 2013 Q1 2013 0.3 13.4 EUR 14.0 B Industrial Goods & Services

SAF Holland SA 16 May 2013 Q1 2013 0.3 5.8 EUR 5.0 H Automobiles & Parts

UMS United Medical Syste 17 May 2013 Q1 2013 0.0 9.9 EUR NA Health Care

Youniq Ag 17 May 2013 Q1 2013 0.1 5.3 EUR NA Real Estate

Sag Solarstrom 20 May 2013 Q1 2013 0.0 2.9 EUR NA Utilities

United Internet 21 May 2013 Q1 2013 3.6 18.8 EUR 22.0 B 0.3 3 Technology

Lloyd Fonds Ag 21 May 2013 Q1 2013 0.0 0.4 EUR NA Financial Services

GSW 21 May 2013 Q1 2013 1.5 29.7 EUR 36.0 B Real Estate

Usu Software Ag 21 May 2013 Q1 2013 0.1 7.6 EUR NA Technology

Essanelle Hair Group 22 May 2013 Q1 2013 0.0 10.8 EUR NA Retail

Aareal Bank 22 May 2013 Q1 2013 1.0 16.4 EUR 20.5 B Financial Services

Hans Einhell AG 22 May 2013 Q1 2013 0.1 32.4 EUR NA Personal & Household Goods

Ifm Immobilien A 23 May 2013 Q1 2013 0.1 11.8 EUR NA Real Estate

Centrosolar Grou 23 May 2013 Q1 2013 0.0 0.6 EUR NA Oil & Gas

IBS 23 May 2013 Q2 2013 0.1 9.9 EUR NA Technology

Electronic Line 23 May 2013 Q1 2013 0.0 0.5 EUR NA Technology

Highlight Communications 23 May 2013 Q1 2013 0.2 4.3 EUR NA Media

Dr. Hoenle 24 May 2013 Q2 2013 0.1 11.8 EUR NA Industrial Goods & Services

Constantin Medien AG 24 May 2013 Q1 2013 0.1 1.8 EUR 1.4 H Media

Sixt AG 27 May 2013 Q1 2013 0.7 15.6 EUR 16.0 H Retail

INDUS Holding 28 May 2013 Q1 2013 0.5 24.3 EUR NA Industrial Goods & Services

Hornbach Baumarkt AG 28 May 2013 Y 2013 0.8 25.7 EUR NA NR Retail

Hornbach Holding 28 May 2013 Y 2013 0.8 49.4 EUR 64.0 B Retail

Df Deutsche Forf 29 May 2013 Q1 2013 0.0 3.7 EUR NA Financial Services

IVU Traffic Technologies 29 May 2013 Q1 2013 0.0 1.6 EUR NA Technology

Youbisheng Green 29 May 2013 Q1 2013 0.1 4.9 EUR NA Basic Resources

Orad Hi-Tech 29 May 2013 Q1 2013 0.0 1.7 EUR 5.0 B Technology

Silicon Sensor International 30 May 2013 Q1 2013 0.1 8.1 EUR NA Industrial Goods & Services

KWS AG 30 May 2013 Q3 2013 1.9 280.6 EUR NA Food & Beverage

Francotyp-Postal 30 May 2013 Q1 2013 0.0 2.2 EUR NA Industrial Goods & Services

FORTEC Elektronik AG 30 May 2013 Q3 2013 0.0 10.2 EUR NA Technology

Mbb Industries 31 May 2013 Q1 2013 0.1 17.6 EUR NA Financial Services

Bmp Media Invest 31 May 2013 Q1 2013 0.0 0.7 EUR NA Financial Services

Isra Vision Ag 31 May 2013 Q2 2013 0.1 28.4 EUR NA Technology

CTS Eventim AG 31 May 2013 Q1 2013 1.3 26.8 EUR 32.0 B Industrial Goods & Services

Deag Deut Entert 31 May 2013 Q1 2013 0.0 3.5 EUR NA Travel & Leisure

Fabasoft 04 Jun 2013 Y 2013 0.0 2.7 EUR NA Technology

Gesco Ag 11 Jun 2013 Y 2013 0.2 73.9 EUR NA Industrial Goods & Services

P&I 14 Jun 2013 Y 2013 0.3 33.8 EUR NA NR Technology

Heidelberger Druck 14 Jun 2013 Y 2013 0.4 1.5 EUR 2.5 B Industrial Goods & Services

Deutsche Beteiligungs 14 Jun 2013 Q2 2013 0.3 18.8 EUR NA NR Financial Services

Gerry Weber 14 Jun 2013 Q2 2013 1.5 32.2 EUR 40.0 B Personal & Household Goods

Jetter AG 28 Jun 2013 Y 2013 0.0 4.7 EUR NA Industrial Goods & Services


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Appendix C Companies mentioned list Figure 101: List of companies mentioned in this report Ticker Rec. Company FF-Market Price Upside/ Perf. P/E Ratio Div. Div. EV/ EV/ EV/

cap. as of Target- Downs. since Yield Sales EBITDA OCSharecl. 05/04/2013 price potential last 2012E 2013E 2014E 2012E 2013E 2014E 2013E 2013E

(Euro m) EUR in EUR (%) 3M (%) EUR EUR EUR EUR (%) 13E 13E 13EAutomobileBDTG.DE H Bertrandt Ag 386 86.04 75.00 -12.83 13.89 5.14 5.60 5.80 16.74 15.36 14.83 2.25 2.62 1.12 8.51 3.20ZILGn.DE H Elringklinger Ag 802 22.60 21.00 -7.08 -11.53 1.36 1.53 1.70 16.67 14.73 13.33 0.54 2.38 1.54 7.45 1.84LEOGn.DE H Leoni Ag 1,034 29.31 27.00 -7.88 0.26 4.76 3.00 3.69 6.16 9.76 7.93 0.90 3.07 0.34 4.42 1.07SW1.DE B Shw 70 34.01 34.00 -0.03 11.45 2.81 3.11 4.12 12.09 10.94 8.26 1.35 3.97 0.55 4.84 3.75VOWG.DE B Volkswagen Ag 4,943 145.50 165.00 13.40 -8.94 23.90 22.47 28.87 6.09 6.48 5.04 4.00 2.75 0.38 3.43 1.46

BanksARLG.DE B Aareal Bank Ag 744 16.16 20.50 26.86 -6.87 1.42 1.69 2.17 11.39 9.58 7.44 0.25 1.55 NA NA NA

Basic ResourcesNAFG.DE H Aurubis 1,845 46.31 58.00 25.26 -15.12 4.60 4.92 4.94 10.06 9.41 9.38 1.40 3.02 0.16 6.81 0.83O2C.DE B C.A.T. Oil 123 8.02 9.50 18.51 10.45 0.37 0.78 0.97 21.96 10.28 8.25 0.00 0.00 1.04 4.33 1.41SZGG.DE H Salzgitter 1,337 30.33 36.00 18.71 -24.57 -1.89 1.04 2.98 -16.08 29.16 10.19 0.25 0.82 0.24 5.24 0.97

ChemicalsFPEG_p.DE H Fuchs Petrolub Ag-Pfd 2,054 64.05 46.00 -28.18 11.34 2.89 3.14 3.35 22.14 20.37 19.11 1.35 2.11 2.13 11.50 7.12FPEG.DE NR Fuchs Petrolub Ag 904 59.47 12.88 2.89 3.14 3.35 20.56 18.92 17.74 1.35 2.27 2.13 11.50 7.12SGCG.DE H Sgl Group Se 879 30.30 30.00 -0.99 -6.69 0.70 0.65 1.25 43.57 46.89 24.22 0.25 0.83 1.62 13.24 1.83SY1G.DE H Symrise 3,092 30.63 29.00 -5.31 14.07 1.55 1.74 1.92 19.79 17.56 15.98 0.73 2.39 2.35 11.78 3.21WCHG.DE S Wacker 834 55.30 37.00 -33.09 1.30 1.80 1.90 NA 30.73 29.04 0.48 0.86 0.77 4.61 0.88

ConstructionB5AG.DE H Bauer Ag 194 18.93 20.00 5.65 -13.85 1.47 1.93 2.56 12.87 9.83 7.40 0.45 2.38 0.64 5.28 0.90

ConsumerCWCG.DE B Cewe Color 155 32.80 38.00 15.87 5.13 2.87 2.99 3.33 11.42 10.96 9.84 1.50 4.57 0.44 3.30 1.34GWIG.DE B Gerry Weber 882 32.42 40.00 23.40 -12.08 1.72 1.99 2.33 18.88 16.32 13.90 0.90 2.78 1.56 9.36 3.71BOSSn.DE B Hugo Boss-Pfd 2,026 86.72 96.00 10.70 7.13 4.51 4.95 5.58 19.23 17.53 15.55 3.46 3.99 2.44 10.69 6.34LOEG.DE H Loewe 15 3.10 10.57 -0.10 0.14 0.20 -31.32 22.73 15.64 0.00 0.00 0.14 1.69 0.41PUMG.DE H Puma Se 609 231.90 225.00 -2.98 1.37 12.99 14.62 16.68 17.85 15.86 13.90 1.90 0.82 0.91 7.86 1.95TTIGn.DE B Tom Tailor 300 17.27 19.00 10.02 6.89 1.20 1.60 1.94 14.37 10.81 8.90 0.30 1.74 0.64 5.38 1.21VIBG_p.DE H Villeroy & Boch 92 8.25 7.00 -15.15 18.06 0.56 0.56 0.65 14.82 14.73 12.76 0.35 4.24 0.42 5.40 1.57

Financial servicesAOXG.DE B Alstria Office Reit-Ag 619 8.90 10.70 20.22 -5.93 0.55 0.65 0.69 16.16 13.71 12.98 0.58 6.57 14.00 16.53 0.92CDBG.DE B Comdirect 229 8.01 9.00 12.36 -3.82 0.52 0.49 0.56 15.42 16.23 14.27 0.49 6.16 NA NA NADRNG.DE H Dab Bank 67 3.55 3.50 -1.41 -3.49 0.22 0.21 0.25 16.20 16.53 13.95 0.21 6.05 NA NA NADEQGn.DE H Deutsche Euroshop 1,412 30.79 33.00 7.18 -1.09 1.68 2.02 2.11 18.28 15.22 14.63 1.25 4.06 13.81 15.93 1.01DWNG.DE H Deutsche Wohnen 2,017 13.71 15.50 13.10 -0.11 0.52 0.67 0.70 26.29 20.41 19.63 0.34 2.45 10.37 20.57 1.07GFJG.DE H Gagfah 680 8.99 8.00 -10.99 0.80 0.38 0.33 0.33 23.83 27.09 27.07 0.00 0.00 7.76 20.35 0.93GKLG.DE H Grenke Group 407 56.44 47.00 -16.73 9.96 3.10 3.23 3.45 18.19 17.49 16.37 0.90 1.59 6.09 13.30 0.43GIBG.DE B Gsw Immobilien 1,438 29.71 36.00 21.17 -3.86 1.27 1.59 1.72 23.38 18.65 17.25 1.04 3.48 13.38 21.58 0.98LEGn.DE B Leg 1,163 41.26 48.50 17.55 na 2.55 2.64 2.88 16.16 15.61 14.34 1.72 4.16 8.75 18.23 0.99PMOG.DE H Prime Office 183 3.40 3.50 2.94 -3.63 0.31 0.01 0.06 11.02 354.46 58.07 0.07 1.98 12.65 45.73 0.78

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Figure 102: List of companies mentioned in this report (Contd.) Ticker Rec. Company FF-Market Price Upside/ Perf. P/E Ratio Div. Div. EV/ EV/ EV/


(Euro m) EUR in EUR (%) 3M (%) EUR EUR EUR EUR (%) 13E 13E 13EFood & BeveragesSZUG.DE H Suedzucker 2,242 32.16 31.00 -3.59 4.04 1.85 2.72 2.52 17.41 11.80 12.77 1.10 3.42 1.20 7.28 1.78

IndustrailsAS1Gn.DE Aleo Solar Ag 12 NA -81.07 0.20 NA NA 0.00 NM NM NMBYWGnx.DE H Baywa 475 36.22 39.00 7.69 7.36 1.68 2.67 2.97 21.54 13.54 12.20 1.10 3.04 0.17 7.55 1.21GBFG.DE H Bilfinger Se 2,755 77.13 82.00 6.31 6.84 5.75 6.28 6.59 13.41 12.28 11.70 3.00 3.89 0.37 5.60 2.24DEZG.DE H Deutz Ag 354 3.86 2.62 0.20 0.31 0.47 19.00 12.42 8.25 0.00 0.00 0.54 5.70 1.15DUEG.DE B Duerr 909 78.58 95.00 20.90 15.63 6.44 7.65 7.51 12.20 10.28 10.46 2.68 3.41 0.48 5.52 2.95G1AG.DE B Gea 4,686 25.61 30.00 17.16 -0.76 2.28 2.35 2.58 11.23 10.88 9.92 0.65 2.54 0.90 7.44 1.79GFKG.DE H Gfk 685 40.27 39.50 -1.91 1.08 2.63 2.81 3.03 15.31 14.32 13.27 0.79 1.95 1.04 7.30 1.38GILG.DE H Gildemeister Ag 850 15.00 -10.69 1.31 1.39 1.54 11.42 10.81 9.73 0.38 2.53 0.41 4.70 0.95HDDG.DE B Heidelberger Druck 412 1.55 2.50 60.98 27.80 -0.99 -0.15 0.18 -1.57 -10.30 8.54 0.00 0.00 0.30 6.05 0.68JENG.DE H Jenoptik Ag 340 7.85 7.50 -4.51 0.17 0.68 0.71 0.72 11.63 11.03 10.83 0.18 2.27 0.82 5.64 0.99JUNG_p.DE B Jungheinrich 554 31.80 32.00 0.63 2.29 3.12 3.40 3.59 10.21 9.35 8.86 0.92 2.90 0.51 3.46 1.16KCOGn.DE H Kloeckner & Co. 901 10.44 9.50 -8.96 7.86 -0.82 0.09 0.38 -12.69 111.96 27.26 0.00 0.00 0.20 8.44 0.64SKBG.DE H Koenig & Bauer Ord 193 17.04 12.00 -29.58 25.54 0.70 0.99 1.05 24.18 17.16 16.20 0.20 1.17 0.25 4.63 0.67KRNG.DE H Krones 635 54.23 38.00 -29.93 16.44 2.91 3.11 3.92 18.62 17.41 13.83 0.78 1.44 0.58 7.98 1.89KU2G.DE H Kuka Ag 812 31.10 30.00 -3.54 10.78 1.64 2.07 2.10 18.97 15.05 14.83 0.62 1.99 0.53 6.31 4.53MANG.DE H Man Ord 3,134 84.12 82.00 -2.52 1.83 2.56 5.75 7.72 32.81 14.62 10.90 6.00 7.13 0.73 7.42 2.36MANGP.F H Man Pref 381 NA 31.00 4.28 2.56 5.75 7.72 6.00 0.73 7.42 2.36MTXGn.DE B Mtu Aero Engines Gmbh 3,612 71.67 78.00 8.83 3.15 4.01 4.83 5.53 17.89 14.84 12.95 1.60 2.24 1.25 9.03 2.15NDXG.DE H Nordex 219 5.03 3.00 -40.36 55.86 -0.12 0.05 NA -42.27 101.02 0.00 0.00 0.36 7.45 0.87NOEJ.DE H Norma Group Ag 624 24.17 22.00 -8.98 14.60 1.94 1.97 2.27 12.48 12.27 10.64 0.69 2.85 1.49 7.74 1.90PV.DE S Pfeiffer Vacuum Technology 897 84.45 69.00 -18.29 -8.26 5.13 5.11 5.60 16.45 16.52 15.08 3.30 3.91 1.55 9.05 3.25RAAG.DE H Rational Ag 784 229.25 3.50 8.49 9.41 10.46 26.99 24.36 21.91 7.53 3.28 4.94 16.34 18.27RHMG.DE S Rheinmetall Ord 1,533 35.19 31.00 -11.91 -5.96 4.99 2.33 4.58 7.06 15.10 7.69 1.60 4.55 0.48 6.02 1.54RSTI.DE H Rofin-Sinar Technologies Inc 574 19.91 15.00 -24.66 11.58 1.37 1.55 NA 14.53 12.86 0.00 0.00 1.02 7.93 1.40SFQN.DE H Saf Holland Sa 283 5.84 5.00 -14.31 6.44 0.40 0.69 0.83 14.46 8.45 7.01 0.28 4.72 0.42 4.79 1.01SLTG.MU H Schaltbau 171 NA -4.40 3.03 3.24 4.04 0.74 0.59 5.70 1.88F3CG.DE B Sfc Energy Ag 24 5.46 12.00 119.82 -8.69 -0.07 0.11 0.27 -74.06 51.48 20.06 0.00 0.00 0.57 10.33 1.10SNGG.DE H Singulus Technologies 68 1.15 2.50 116.64 -25.69 0.01 0.02 NA 84.85 56.41 0.00 0.00 -0.08 -0.57 -0.14S92G.DE B Sma 182 18.23 25.00 37.17 -19.56 2.16 -0.60 0.35 8.42 -30.45 52.49 0.05 0.26 0.17 4.67 0.40SWVG.DE H Solarworld Ag 85 0.93 -46.79 -2.13 -1.27 -0.99 -0.43 -0.73 -0.94 0.00 0.00 1.43 NM 0.84VOSG.DE H Vossloh 327 79.03 70.00 -11.43 4.50 4.35 4.34 5.32 18.18 18.21 14.85 1.95 2.47 0.96 8.94 1.38WACGn.DE H Wacker Neuson Se 248 11.29 10.00 -11.43 5.69 0.84 0.80 1.13 13.45 14.20 9.98 0.36 3.17 0.92 6.74 0.86WING.DE B Wincor Nixdorf 1,182 36.69 50.00 36.28 -3.65 2.12 2.87 3.62 17.34 12.76 10.13 1.44 3.92 0.50 6.63 1.71

MediaSPRGn.DE H Axel Springer 1,474 33.71 42.00 24.59 3.05 3.00 2.55 2.68 11.24 13.23 12.57 1.70 5.04 1.48 8.67 2.14EV4G.DE H Constantin Medien Ag 84 1.79 1.40 -21.83 9.29 0.14 0.15 0.17 13.08 11.71 10.82 0.00 0.00 0.61 2.63 1.75EVDG.DE B Cts Eventim Ag 561 26.58 32.00 20.41 -0.70 1.17 1.36 1.56 22.69 19.60 16.99 0.68 2.55 2.07 9.06 7.10PSMG_p.DE B Prosiebensat.1 2,071 26.23 29.00 10.56 20.75 1.99 1.93 2.16 13.18 13.57 12.14 1.49 5.70 2.86 9.11 2.28SKYDn.DE H Sky Deutschland 1,891 3.89 4.50 15.56 -15.87 -0.23 -0.10 0.06 -16.90 -40.22 63.39 0.00 0.00 2.26 55.29 3.34SAXG.DE B Stroeer 160 8.10 12.50 54.32 12.07 0.52 0.64 0.89 15.52 12.71 9.07 0.00 0.00 1.15 6.00 1.07

Pharma & HealthcareBION.S B Bb Biotech Ag 969 99.60 106.50 6.93 10.62 2.85 2.90 2.91 34.96 34.38 34.24 1.79 1.80 NM 10.06 389.74AFXG.DE H Carl Zeiss Meditec Ag 687 23.06 22.50 -2.41 3.52 0.88 1.07 1.19 26.08 21.55 19.37 0.50 2.17 1.83 11.10 3.14DRWG.DE B Draegerwerk Ag & Co Kgaa 250 86.25 115.00 33.33 39.92 7.15 8.06 8.82 12.07 10.70 9.77 1.03 1.19 0.73 5.77 1.91DRWG_p.DE B Draegerwerk Pref 602 98.05 115.00 17.29 24.23 7.15 8.06 8.82 13.72 12.16 11.11 1.03 1.05 0.73 5.77 1.91EVTG.DE H Evotec 248 2.27 2.60 14.54 -16.34 0.02 0.06 0.08 107.45 37.30 27.22 0.00 0.00 2.25 12.60 1.75GXIG.DE H Gerresheimer 1,218 42.88 43.00 0.29 11.30 2.56 2.79 3.30 16.75 15.39 12.98 0.70 1.63 1.33 6.76 1.75MORG.DE B Morphosys 733 30.47 43.00 41.12 3.29 0.10 -0.58 -0.56 299.52 -52.48 -54.19 0.00 0.00 11.37 NM 10.53QGEN.OQ B Qiagen N.V. 3,627 20.46 21.50 5.08 8.93 1.06 1.20 1.35 19.24 17.09 15.13 0.00 0.00 3.68 12.74 1.70RHKG.DE H Rhoen Klinikum Ord 1,524 16.09 16.60 3.20 9.59 0.67 0.94 1.23 24.02 17.17 13.08 0.36 2.25 0.99 8.54 1.21SATG_p.DE H Sartorius (Pref) 686 77.55 77.00 -0.71 6.82 3.71 4.18 4.65 20.93 18.55 16.67 1.09 1.40 1.88 9.61 2.25STAGn.DE B Stada Arzneimittel Ag 1,689 29.48 33.00 11.94 17.92 2.47 2.86 3.47 11.95 10.30 8.49 0.53 1.78 1.43 7.14 1.30SBSG.DE H Stratec 267 33.80 32.00 -5.33 -6.34 1.27 1.63 2.00 26.70 20.68 16.88 0.70 2.07 2.54 13.02 4.88

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Figure 103: List of companies mentioned in this report (Contd.) Ticker Rec. Company FF-Market Price Upside/ Perf. P/E Ratio Div. Div. EV/ EV/ EV/


(Euro m) EUR in EUR (%) 3M (%) EUR EUR EUR EUR (%) 13E 13E 13ERetailCLSGn.DE H Celesio Ag 1,139 14.69 13.50 -8.07 11.32 1.21 1.28 1.40 12.10 11.51 10.50 0.38 2.61 0.19 6.86 0.95DEXGn.DE S Delticom Ag 204 35.90 28.00 -22.01 8.32 1.80 1.75 2.34 19.98 20.53 15.37 1.57 4.38 0.83 13.04 9.47DOHG.DE H Douglas 113 38.13 38.00 -0.33 -0.14 1.48 2.16 2.23 25.72 17.66 17.09 1.00 2.62 0.44 6.07 1.73FIEG.DE S Fielmann 799 73.20 60.00 -18.03 -0.57 3.03 3.08 3.10 24.19 23.74 23.60 2.63 3.59 2.43 12.51 7.83HAWG.DE H Hawesko 155 43.00 40.00 -6.98 2.50 1.72 2.19 2.43 25.00 19.62 17.70 1.62 3.76 0.82 10.34 4.13HBHG_p.DE B Hornbach Holding 351 49.58 64.00 29.08 -5.10 4.79 3.97 4.84 10.35 12.48 10.25 0.67 1.35 0.44 6.28 0.89MEOG.DE H Metro Ord 3,172 22.01 23.00 4.52 -3.93 1.89 1.93 2.12 11.61 11.42 10.37 1.02 4.62 0.16 2.92 0.95MEOG_p.F H Metro Pref 65 NA -5.94 1.89 1.93 2.12 1.02 0.16 2.92 0.95PRAG.DE B Praktiker 167 1.10 2.60 135.72 -15.52 -2.78 -0.45 0.06 -0.40 -2.43 19.89 0.00 0.00 0.25 18.58 0.93TTKG.DE H Takkt 209 12.83 12.00 -6.47 28.81 1.02 1.04 1.19 12.56 12.36 10.80 0.32 2.49 1.12 7.77 1.69TIMGn.DE B Tipp24 263 41.31 50.00 21.04 8.73 5.49 3.38 3.36 7.52 12.20 12.28 5.00 12.10 1.24 4.15 NMZO1G.DE B Zooplus Ag 130 41.23 50.00 21.29 24.26 -0.35 0.24 1.07 -119.32 170.93 38.56 0.00 0.00 0.63 87.05 6.61

SoftwareBC8G.DE H Bechtle 490 36.10 33.00 -8.57 16.32 2.73 3.14 3.32 13.23 11.49 10.88 1.04 2.87 0.30 5.75 1.62COPMa.DE B Compugroup Medical Ag 391 16.75 23.00 37.31 20.06 1.36 1.50 1.76 12.36 11.14 9.50 0.53 3.14 2.15 8.52 2.17PSAGn.DE B Psi Ag 191 15.36 18.00 17.23 -0.42 0.59 0.79 1.00 26.00 19.43 15.43 0.42 2.71 1.05 9.81 3.93SOWG.DE B Software Ag 1,810 27.90 38.00 36.23 -10.58 2.39 2.67 3.14 11.68 10.44 8.88 0.50 1.79 1.99 6.69 1.97TFAG.DE H Tomorrow Focus 79 4.18 4.00 -4.31 9.89 0.27 0.31 0.41 15.62 13.49 10.13 0.08 1.91 1.29 6.70 1.75UTDI.DE B United Internet 1,812 18.55 22.00 18.60 16.21 0.79 1.08 1.39 23.52 17.15 13.38 0.35 1.89 1.40 9.11 6.49WDIG.DE H Wirecard 1,944 20.28 16.00 -21.10 11.85 0.68 0.78 0.89 29.95 26.03 22.80 0.12 0.59 4.72 16.76 4.50OBCGn.DE H Xing Ag 94 39.60 50.00 26.26 -0.71 1.78 1.94 2.49 22.24 20.40 15.88 0.65 1.64 1.92 6.73 NM

TechnologyADAG.DE H Adva 177 3.78 4.50 19.02 -13.25 0.40 0.33 0.40 9.36 11.52 9.56 0.00 0.00 0.34 2.53 1.12AIXGn.DE B Aixtron 913 11.31 14.00 23.78 10.98 -1.10 -0.08 0.50 -10.26 -135.21 22.78 0.00 0.00 3.23 150.04 2.82DLGS.DE H Dialog Semiconductor Plc 791 10.87 15.00 37.99 -27.82 0.91 1.21 1.66 11.90 8.96 6.53 0.00 0.00 0.78 4.54 2.71ELGG.DE H Elmos 66 8.13 7.40 -8.98 5.87 0.38 0.57 0.72 21.24 14.25 11.31 0.25 3.08 0.60 3.22 0.75EUCAn.DE H Euromicron 127 15.55 17.00 9.32 -21.61 2.25 1.96 2.43 6.90 7.92 6.40 0.40 2.57 0.50 5.31 0.86GGS.DE H Gigaset Ag 56 0.92 1.20 30.43 -14.85 -0.26 -0.32 -0.21 -3.54 -2.88 -4.46 0.00 0.00 0.09 1.70 0.70KBCG.DE H Kontron Ag 164 4.29 3.70 -13.69 -8.51 -0.16 0.24 NA -26.59 17.80 0.08 1.87 0.39 6.00 0.66QSCG.DE B Qsc Ag 242 2.43 2.80 15.18 11.39 0.13 0.21 0.20 18.34 11.68 12.32 0.10 4.11 0.70 3.81 1.30SMHNn.DE H Suess Microtec Ag 180 9.09 9.00 -0.95 -8.19 0.19 0.23 0.25 46.86 39.15 35.99 0.00 0.00 0.95 12.12 1.35

TelecommunicationsFNTGn.DE B Freenet Ag 1,606 18.28 17.00 -7.00 24.01 1.90 1.83 1.86 9.61 9.99 9.85 1.20 6.56 0.87 7.42 1.67YOCG.DE H Yoc Ag 8 7.08 -15.71 -1.18 -0.81 -0.34 -5.98 -8.75 -20.86 0.00 0.00 0.37 17.38 1.59

Transportation & LogisticsAB1.DE B Air Berlin 121 2.14 3.50 63.55 41.33 -0.39 -0.42 0.06 -5.50 -5.05 36.95 0.00 0.00 1.16 145.16 5.70FRAG.DE B Fraport Ag 1,579 43.11 52.00 20.64 -2.21 2.58 2.52 3.10 16.69 17.09 13.89 1.25 2.90 2.55 7.43 1.11HHFGn.DE H Hhla 425 17.24 17.00 -1.36 -10.54 0.95 0.75 0.85 18.13 22.84 20.28 0.55 3.19 1.54 6.21 1.90SIXG.DE H Sixt Ag 223 15.48 16.00 3.36 -6.14 1.72 1.63 1.84 8.99 9.48 8.41 0.63 4.06 1.26 4.03 1.04SIXG_p.F H Sixt Pref 237 NA -5.70 1.72 1.63 1.84 0.63 1.26 4.03 1.04TUIGn.DE B Tui Stk N 1,137 7.79 10.30 32.19 4.34 0.77 0.67 NA 10.16 11.69 0.00 0.00 0.14 2.18 1.48VT9G.DE B Vtg Ag 126 13.35 14.00 4.87 4.32 0.88 1.10 1.46 15.15 12.14 9.15 0.40 3.00 1.20 5.23 0.97

UtilitiesMVVGn.DE H Mvv Energie 200 22.88 19.00 -16.96 -7.42 1.47 1.45 1.44 15.61 15.80 15.88 0.90 3.92 0.83 7.85 1.09RWEG_p.F NR Rwe Pref 1,012 28.22 -3.05 4.15 4.35 3.95 6.80 6.48 7.14 2.10 7.44 0.75 4.35 0.67

EPS


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Appendix 1

Important Disclosures Additional information available upon request For disclosures pertaining to recommendations or estimates made on securities other than the primary subject of this research, please see the most recently published company report or visit our global disclosure look-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr Analyst Certification

The views expressed in this report accurately reflect the personal views of the undersigned lead analyst(s). In addition, the undersigned lead analyst(s) has not and will not receive any compensation for providing a specific recommendation or view in this report. Lars Slomka/Jan Rabe Equity rating key Equity rating dispersion and banking relationships

Buy: Based on a current 12- month view of total share-holder return (TSR = percentage change in share price from current price to projected target price plus pro-jected dividend yield ) , we recommend that investors buy the stock. Sell: Based on a current 12-month view of total share-holder return, we recommend that investors sell the stock Hold: We take a neutral view on the stock 12-months out and, based on this time horizon, do not recommend either a Buy or Sell. Notes:

1. Newly issued research recommendations and target prices always supersede previously published research. 2. Ratings definitions prior to 27 January, 2007 were:

Buy: Expected total return (including dividends) of 10% or more over a 12-month period Hold: Expected total return (including dividends) between -10% and 10% over a 12-month period Sell: Expected total return (including dividends) of -10% or worse over a 12-month period

39 %

53 %

8 %46 % 38 %

46 %

0

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Buy Hold Sell

European Universe

Companies Covered Cos. w/ Banking Relationship

9 April 2013



Regulatory Disclosures

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