2012-05-macroeco

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GDP | Economics

National Production15 May 2012

Hedmond [email protected]+562 713 4807

Mario [email protected]+562 713 4903

Juan Camilo Dauder jds @ce lfi n.com+574 326 1376

Cesar [email protected]+562 490 5012

Manufacturing sector surprises on the downsideToday (May 15) Perus National Statistics and Information Institute (INEI) reported theNational Production indicator (a GDP proxy) up 5.6% YoY in March 2012, below our andmarket expectations.

Manufacturing sector contraction of 3.2% YoY was a surprise since signs of recovery weredepicting during the last three months. The main reason for this drop was the contraction insales abroad (mainly to Ecuador, Venezuela, and Chile).

Likewise, there was a revision on the downside in the demand for cement, but it is stillgrowing strong at 14.7% YoY.

We observe that services activities continue growing at solid rates with hotels and restaurants (+10.0% YoY), financial services (+10.0% YoY), transport and communications (+9.3% YoYservices to others companies (+7.9% YoY), and retail (+7.2% YoY). Despite the drop in work-in-process construction - by far keeps - pushing the economy; it was up 14.7% YoY mainly onincreases in the demand for concrete (+15.5% YoY) - civil works are in mining, shoppingmalls, industrial facilities, water and sewerage, and roads and highways. Mining anhydrocarbons expanded by 6.0% YoY in March and it seems that the path of recovery isresuming. Metallic mining activity was up 4.1% YoY and hydrocarbon up 15.3% YoY. On itspart, Fishing is being hit by environmental changes and fell again in March. The sector wasdown 15.1% YoY

Peru: National Production Index (GDP proxy) (%, YoY)

0

4

8

12

Mar-10 Jul-10 Nov-10 Mar-11 Jul-11 Nov-11 Mar-12

Sources: INEI, Celfin Capital.

Favorable outlook for 2012Recently (May 3), we updated our economic growth forecast for 2012 to 6.1% from previous5.9%, since we observe investment up 7.4% and government spending growing at 6.7% in2012. Undoubtedly, construction sector will play a key role and other sectors will be benefitedby this momentum.

Economics

GDP expands 5.6% YoY in MarchGross Domestic Product | Peru

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GDP | Economics

Economics | Gross Domestic Product5 May 2012

Manufacturing (YoY, %)

(8)

0

8

16

24

Mar-10 Nov-10 Jul-11 Mar-12


Transport and Communications (YoY, %)

0

5

10

15



Construction (YoY, %)

(5)

0

5

10

15

20

25



Retail (YoY, %)

0

4

8

12



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GDP | Economics

Research Team & Disclaimer

Celfin Capital Equity ResearchChile Peru Colombia

Cesar Perez-Novoa Isabel Darrigrandi Natalia AgudeloManaging Director: Strategy & Economics Senior Analyst: Metals & Mining Analyst: Energy & Utilities

+562 490 5012 +562 490 5093 +574 326 [email protected] [email protected] [email protected]

Tomas Gonzalez Hedmond Rios Jairo AgudeloSenior Analyst: Electric & Water Utilities, TMT Economist Analyst: Industrials & Consumer


Alex Sadzawka Mario Arend Ruben ArismendySmall Caps Analyst: Industrials Chief Economist Analyst: Metals & Mining Exploration


Jeanne Marie Benoit Juan Camilo DauderSmall Caps Analyst: Consumer Economist / Banks Analyst

+562 490 5304 +574 326 1376 [email protected] [email protected]

Andres CardonaAnalyst: Industrials

+574 326 [email protected]

DisclaimerThis document and its contents do not constitute an offer, invitation or solicitation to purchase or subscribe to any securities or other instruments, or to undertake or divestinvestments. Neither shall this document or its contents form the basis of any contract, commitment or decision of any kind. This material has no regard to the specific investmentobjectives, financial situation or particular needs of any recipient. It is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy orsell any securities or related financial instruments.

Before undertaking any transaction with these instruments, investors should be aware of their operation, as well as the rights, liabilities and risks implied by the same and theunderlying stocks. Investors should note that income from such securities or other investments, if any, may fluctuate and that price or value of such securities and investments mayrise or fall. Any information relating to the tax status of financial instruments discussed herein is not intended to provide tax advice or to be used by anyone to provide tax advice.Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in this report, thus investors effectivelyassume currency risk. References to third parties are based on information obtained from sources believed to be reliable but are not guaranteed as being accurate. Celfin Capitalhas not independently verified such information and therefore no warranty, either express or implicit, is given regarding its accuracy, integrity or correctness. Recipients should notregard it as a substitute for the exercise of their own judgment.

Any opinions expressed in this material are subject to change without notice and Celfin Capital is not under any obligation to update or keep current the information containedherein. Celfin Capital may make purchases and/or sales as principal or agent of this security or provide corporate finance or other services to the issuer. However, Celfin Capitaldoes not trade for its own account.

Celfin Capital or any of its salespeople, traders, and other professionals may provide oral or written market commentary or trading strategies to its clients that reflect opinions thatare contrary to the opinions expressed herein. Furthermore, Celfin Capital or any of its affiliates' investing businesses may make investment decisions that are inconsistent with therecommendations expressed herein.

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Rating System: Ratings refer to a period of 12 months. Our ratings are classified in three categories:Buy = an absolute return of at least 15%;Hold = an absolute return between 15% and 5%;Sell = a return of 5% or lower in relation to its absolute valuation.

Under exceptional circumstances and for specific reasons, we may use UR Rating under review.
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2012-05-macroeco

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