2.3 Business Characteristics of each Undertaking

(1) Business Characteristics

The characteristics of each of the company’s business are classified as
follows:

  Securities Broker

Market share value of the company for the past 3 years compared to the
latest updated data as at 31 December, 2003 were shown in the table
below:

Table of Market Share Value

  ---------------------------- ---------- ----------- ----------- -----------
  Securities Trading Volume    2000       2001        2002        2003

  SET (Million Baht)           925,202    1,579,144   2,053,357   4,670,281

  US (Million Baht)            31,456     68,322      142,044     201,645

  US Market share (%)          1.70%      2.16%       3.45%       2.16%
  ---------------------------- ---------- ----------- ----------- -----------

For the past 3 years, during May 2000 to March 2002 the Company had 1
sub-broker but at present we do not have any sub-broker.

Securities Broker Business

New Customer Securities Policy

It is the Company’s policy to welcome all kinds of customers, domestics,
institutional as well as foreigners. At present, however, most of our
customers are domestic customers and we have set up the screening of new
customers policy according to the rules and regulations of the SET while
focusing on minimizing the company‘s risk.

Margin accounts Policy

Since 26 June, 2002, the Company has provided margin trading service to
customers in form of Credit Balance under Credit Balance Financing
project. The amount of line has been set up in relation to the
securities types which have different degrees of risk in which will be
announced occasionally as appropriate. The Company will set up the list
of the securities which are qualified to be put as collaterals.
Followings are the policies governing the Credit Balance considerations
:

1.  Marketing staff should know their customers in person so that they
    can evaluate the investment objectives, financial position or
    limitations as well as the basic investment knowledge of their
    customers clearly.

2. Determine appropriate maximum limit of credit line of each customer
under a certain period of time. The Credit Balance Line and the credit
line for stock borrowings for short sale should be approved under one
maximum total credit line for the same customers.

3. Disclose the relationships between marketing staff and the customers
or between the Company and the customers to notify the Company’s
compliance to the Code of Ethics like that of a professional company,
and which is considered to be a provision in the Compliance manual to be
strictly obeyed.

4. Approved authority of the credit line is dependable on the Executive
Board.

5. The marketing staff has to certify that the person who makes the
buying and selling decision is the eligible person not the nominee
person and that the payment should be settled by that particular person.
The Company is therefore, forbidden to approve any credit line to the
nominee of other persons intentionally or unintentionally.

6. In opening a securities trading account, the customers have to make
deposit in cash first before trading can be made at the amount not less
than the initial margin regulated by the Stock Exchange of Thailand (at
present it is 50%).

7. The Company is forbidden to approve for any margin on securities
trading to the customers exceeding their purchasing limit at a certain
period.

8. Purchasing exceeds purchasing limit can be allowed only if the
customers increase their collaterals amount, either by cash or
securities, to the amount not less than the initial margin of the
exceeded volume purchased before purchasing can be done.

9. The Company will set up the marginable list of securities (including
those right offering shares of the listed companies), initial margin
rate, maintenance margin rate and the minimum requirement rate for each
securities in writing at least once a month.

10. In case the customers’ equity gets lower than the Maintenance
Margin, written notice will be sent to inform them to fill in the
collateral on the next working day so that the customers’ equity is not
lower than the Maintenance Margin.

11. In case the equity of any customer has decreased to be equivalent to
or lower than the minimum requirement value, then the Operations
Department will have to do the force sell on the next working day so
that the equity of the customer gets higher than the minimum requirement
value.

12. Interest on margin loan should be charged to the customers and the
Company will also pay interest to the customers calculated on
collaterals remaining in their margin loan account base on the daily
outstanding amount under the agreed rate. The settlement of interest
will be done by adjusting the margin level of each customer at least
once a month.

13. Report on the outstanding balance and monthly interest settlement on
margin loan account will be sent to inform the customers at least once a
month.

Securities Trading Credit Line Policy

The Company has set up the securities trading credit line and appointed
the authorized signers to approve for each level of the Line for the
customers governing each activity such as Short Sell and Net Settlement
/Waive as well as the approval of the Change of order and the Company’s
Error Port. The authorized signers and related authorities were
appointed by the Board of Executive Directors and was shown in table 1.
Moreover, authorized signers were also appointed to approve for the
temporary credit line effective as of 15 August, 2002 as follows:

+------------------------------+---------------------------------------+
| Credit Line                  | Authorized Signers                    |
|                              |                                       |
| (temporary line per          |                                       |
| customer)                    |                                       |
+------------------------------+---------------------------------------+
| Not exceeding 8 million Baht | Executive Vice President              |
+------------------------------+---------------------------------------+
| Not exceeding 10 million     | First Executive Vice President or     |
| Baht                         |                                       |
|                              | Senior Executive Vice President       |
+------------------------------+---------------------------------------+
| Not exceeding 15 million     | First Executive Vice President or     |
| Baht                         |                                       |
|                              | Senior Executive Vice President and   |
|                              |                                       |
|                              | Managing Director or Executive        |
|                              | Directors                             |
+------------------------------+---------------------------------------+
| Exceeding 15 million Baht    | 3 out of 4 Executive Directors and    |
|                              | proposed to be re-confirmed by the    |
|                              | Board of Directors                    |
+------------------------------+---------------------------------------+

+-------+-------+-------+-------+-------+-------+----------+----------+
| TABLE | App   |       |       |       |       |          |          |
| 1     | roval |       |       |       |       |          |          |
|       | A     |       |       |       |       |          |          |
|       | uthor |       |       |       |       |          |          |
|       | ities |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| C     | New   | Net   | Short | C     | Error |          |          |
| redit | Cash  | Settl | Sell  | hange | Port  |          |          |
| Line  | Ac    | ement |       | Order |       |          |          |
|       | count | &     |       |       |       |          |          |
|       | Op    | Waive |       |       |       |          |          |
|       | ening |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
|       |       |       |       |       | Error | Error    | Transfer |
|       |       |       |       |       | with  | with     | the      |
|       |       |       |       |       | a     | Deficit  | di       |
|       |       |       |       |       | S     |          | fference |
|       |       |       |       |       | quare |          | into     |
|       |       |       |       |       |       |          | C        |
|       |       |       |       |       |       |          | ompany’s |
|       |       |       |       |       |       |          | Port     |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Assi  | Assi  | Assi  | -     | -     | Not      | Amount x |
| exce  | stant | stant | stant |       |       | e        | price <  |
| eding | Vice  | Vice  | Vice  |       |       | xceeding | 10.0     |
|       | Pres  | Pres  | Pres  |       |       | 50,000   | million  |
| 1     | ident | ident | ident |       |       | Baht     | Baht     |
| mi    |       |       |       |       |       |          |          |
| llion |       |       |       |       |       | E        | E        |
| Baht  |       |       |       |       |       | xecutive | xecutive |
|       |       |       |       |       |       | Vice     | Vice     |
|       |       |       |       |       |       | P        | P        |
|       |       |       |       |       |       | resident | resident |
|       |       |       |       |       |       | or First | or First |
|       |       |       |       |       |       |          | E        |
|       |       |       |       |       |       | E        | xecutive |
|       |       |       |       |       |       | xecutive | Vice     |
|       |       |       |       |       |       | Vice     | P        |
|       |       |       |       |       |       | P        | resident |
|       |       |       |       |       |       | resident | or       |
|       |       |       |       |       |       | or       | Senior   |
|       |       |       |       |       |       |          | E        |
|       |       |       |       |       |       | Senior   | xecutive |
|       |       |       |       |       |       | E        | Vice     |
|       |       |       |       |       |       | xecutive | P        |
|       |       |       |       |       |       | Vice     | resident |
|       |       |       |       |       |       | P        | and      |
|       |       |       |       |       |       | resident | proposed |
|       |       |       |       |       |       |          | to       |
|       |       |       |       |       |       |          | In       |
|       |       |       |       |       |       |          | vestment |
|       |       |       |       |       |       |          | C        |
|       |       |       |       |       |       |          | ommittee |
|       |       |       |       |       |       |          | be       |
|       |       |       |       |       |       |          | approved |
|       |       |       |       |       |       |          | by       |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Vice  | Vice  | Vice  | Vice  | Vice  |          |          |
| exce  | Pres  | Pres  | Pres  | Pres  | Pres  |          |          |
| eding | ident | ident | ident | ident | ident |          |          |
|       |       |       |       |       |       |          |          |
| 2     |       |       |       |       |       |          |          |
| mi    |       |       |       |       |       |          |          |
| llion |       |       |       |       |       |          |          |
| Baht  |       |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | S     | S     | S     | S     | S     |          |          |
| exce  | enior | enior | enior | enior | enior |          |          |
| eding | Vice  | Vice  | Vice  | Vice  | Vice  |          |          |
|       | Pres  | Pres  | Pres  | Pres  | Pres  |          |          |
| 5     | ident | ident | ident | ident | ident |          |          |
| mi    |       |       |       |       |       |          |          |
| llion |       |       |       |       |       |          |          |
| Baht  |       |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Exec  | Exec  | Exec  | Exec  | Exec  |          |          |
| exce  | utive | utive | utive | utive | utive |          |          |
| eding | Vice  | Vice  | Vice  | Vice  | Vice  |          |          |
|       | Pres  | Pres  | Pres  | Pres  | Pres  |          |          |
| 8     | ident | ident | ident | ident | ident |          |          |
| mi    |       |       |       |       |       |          |          |
| llion |       |       |       |       |       |          |          |
| Baht  |       |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | First | First | First | First | First | Not      | Amount x |
| exce  | Exec  | Exec  | Exec  | Exec  | Exec  | e        | price >  |
| eding | utive | utive | utive | utive | utive | xceeding | 10.0     |
|       | Vice  | Vice  | Vice  | Vice  | Vice  | 50,000   | million  |
| 10    | Pres  | Pres  | Pres  | Pres  | Pres  | Baht     | Baht     |
| mi    | ident | ident | ident | ident | ident |          |          |
| llion | or    | or    | or    | or    | or    |          |          |
| Baht  | S     | S     | S     | S     | S     |          |          |
|       | enior | enior | enior | enior | enior |          |          |
|       | Exec  | Exec  | Exec  | Exec  | Exec  |          |          |
|       | utive | utive | utive | utive | utive |          |          |
|       | Vice  | Vice  | Vice  | Vice  | Vice  |          |          |
|       | Pres  | Pres  | Pres  | Pres  | Pres  |          |          |
|       | ident | ident | ident | ident | ident |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Man   | Man   | Man   | Man   | Man   | E        | E        |
| exce  | aging | aging | aging | aging | aging | xecutive | xecutive |
| eding | Dir   | Dir   | Dir   | Dir   | Dir   | Vice     | Vice     |
|       | ector | ector | ector | ector | ector | P        | P        |
| 15    | or    | or    | or    | or    | or    | resident | resident |
| mi    | Exec  | Exec  | Exec  | Exec  | Exec  | or First | or First |
| llion | utive | utive | utive | utive | utive | E        | E        |
| Baht  | Dir   | Dir   | Dir   | Dir   | Dir   | xecutive | xecutive |
|       | ector | ector | ector | ector | ector | Vice     | Vice     |
|       |       |       |       |       |       | P        | P        |
|       |       |       |       |       |       | resident | resident |
|       |       |       |       |       |       | or       | or       |
|       |       |       |       |       |       | Senior   | Senior   |
|       |       |       |       |       |       | E        | E        |
|       |       |       |       |       |       | xecutive | xecutive |
|       |       |       |       |       |       | Vice     | Vice     |
|       |       |       |       |       |       | P        | P        |
|       |       |       |       |       |       | resident | resident |
|       |       |       |       |       |       | and      | and      |
|       |       |       |       |       |       | Managing | Managing |
|       |       |       |       |       |       | Director | Director |
|       |       |       |       |       |       | or       | or       |
|       |       |       |       |       |       |          | E        |
|       |       |       |       |       |       | E        | xecutive |
|       |       |       |       |       |       | xecutive | Director |
|       |       |       |       |       |       | Director | and      |
|       |       |       |       |       |       | and      | proposed |
|       |       |       |       |       |       | proposed | to the   |
|       |       |       |       |       |       | to the   | In       |
|       |       |       |       |       |       | E        | vestment |
|       |       |       |       |       |       | xecutive | C        |
|       |       |       |       |       |       | Board    | ommittee |
|       |       |       |       |       |       | for      | for      |
|       |       |       |       |       |       | acknowl  | approval |
|       |       |       |       |       |       | edgement | and      |
|       |       |       |       |       |       |          | proposed |
|       |       |       |       |       |       |          | to the   |
|       |       |       |       |       |       |          | E        |
|       |       |       |       |       |       |          | xecutive |
|       |       |       |       |       |       |          | Board    |
|       |       |       |       |       |       |          | for      |
|       |       |       |       |       |       |          | acknowl  |
|       |       |       |       |       |       |          | edgement |
+-------+-------+-------+-------+-------+-------+----------+----------+
| 15    | Exec  | Exec  | Man   | Man   | Man   |          |          |
| mi    | utive | utive | aging | aging | aging |          |          |
| llion | Dir   | Dir   | Dir   | Dir   | Dir   |          |          |
| Baht  | ector | ector | ector | ector | ector |          |          |
| and   |       |       | or    | or    | or    |          |          |
| up    |       |       | Exec  | Exec  | Exec  |          |          |
|       |       |       | utive | utive | utive |          |          |
|       |       |       | Dir   | Dir   | Dir   |          |          |
|       |       |       | ector | ector | ector |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| 100   | Board | Board | Man   | -     | -     |          |          |
| mi    | of    | of    | aging |       |       |          |          |
| llion | Dire  | Dire  | Dir   |       |       |          |          |
| Baht  | ctors | ctors | ector |       |       |          |          |
| and   |       |       | or    |       |       |          |          |
| up    |       |       | Exec  |       |       |          |          |
|       |       |       | utive |       |       |          |          |
|       |       |       | Dir   |       |       |          |          |
|       |       |       | ector |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+

Definitions in the Approval Authorities Table.

  ------------------------------- ------- --------------------------------
  Approved Credit Line            means   the securities trading approved
                                          limits for the newly open cash
                                          accounts or the new trading
                                          limits after the increasing or
                                          decreasing of the previous limit

  Assistant Vice President, Vice  means   Assistant Vice President, Vice
  President and Senior Vice               President and Senior Vice
  President                               President from the Marketing
                                          Department

  First Executive Vice President  means   First Executive Vice President
  and Executive Vice President            and Executive Vice President
                                          from the Marketing Department

  Senior Executive Vice President means   Senior Executive Vice President
                                          from the Marketing Department

  Executive Board                 means   the Board of Executive Directors
                                          appointed by the Company

  Executive Director              means   The director from the Executive
                                          Board
  ------------------------------- ------- --------------------------------

Settlement Control Policy

The Company has set up a strictly control policy over the customers’
settlement in order to comply with the rules and regulations of SET as
follows:

Payment on securities purchasing should be settled on time. Late payment
or cheques default cases will be followed up by the company’s marketing
officer in order to urge the customers to make payment either by cash or
by depositing into the company’s account and to warn them to be more
careful in the future. Late payment or late submission of share
certificates will subject to a fine. And if the late payment of any
customer happens 3 times in a year, then the account will be closed.

Securities Trading 

The Board of Directors has appointed an Investment Committee to handle
the company’s investment function under the company’s investment. Such
investments may include the investment in both listed securities in the
SET and the MAI or in Bond Dealing Center and the unlisted securities
which consist of both equity and debt instruments and include a long
term as well as short term investments.

Investment Policy

1.  Investment types are divided into 2 types

    1.  Short term investment

    2.  Long term investment

2.  The Investment amount limit is set up so that the company can remain
    its Net Capital Rule of not less than 20%

3.  The Company would invest in those securities from the listed or
    unlisted company in the SET, MAI or in the Thai Bond Dealing Center
    which have good fundamentals, good financial status, fair liquidity
    with growth potential, reasonable price, good management team and
    most of all they should have good governance.

4.  Risk Management

    1.  The risk on investment should be scattered by determining the
        investment according to the period of investment and the types
        of the invested securities groups.

    2.  Set up a hair cut limit.

    3.  Investment decision always supported by research paper.

5.  The monthly report on investment is submitted to the Board of
    Directors monthly for acknowledgement.

As at 31 December, 2003 the ratio between the investment in equity and
debt instrument is 69:31 of the total investment of the Company.

Investment Advisory Business

Most of the Company’s investment advisory services were provided to
large companies and institutions which can become another investment
choice to the customers. Both technical as well as fundamental research
paper was accurately and timely made to support the investors in making
their decision. Moreover, the Company always studies and seeks new
financial tools to serve the customers’ need apart from investment in
capital market and money market.

The Financial Advisory and Underwriting Business

The Company also provides the underwriting services of various kinds of
financial instruments both debts and equity instruments together with
the investment advisory services.

The Company’s subsidiary company is providing the financial advisory
services and the investment banking department will give advices
concerning the shareholder structuring, the fund raising through issuing
of financial instruments such as common stocks, preferred stocks,
debentures and debentures with warrant, etc. and the listing of stocks
in the Stock Exchange of Thailand or in Market Alternative Investment
(MAI).

The approval authorities for underwriting were set up as follows:

+---------------------+-----------------+------------------------------+
| Underwriting Value  | Authorized      | Emergency Case               |
|                     | Signers         |                              |
+---------------------+-----------------+------------------------------+
| 1. Not exceeding    | Executive       | Chairman of the Executive    |
| Baht 30million      | Director        | Board and/or                 |
|                     |                 |                              |
|                     |                 | Managing Director may give   |
|                     |                 | prior approval               |
|                     |                 |                              |
|                     |                 | then the approved case       |
|                     |                 | should be submitted          |
|                     |                 |                              |
|                     |                 | to the Executive Board for   |
|                     |                 | re-confirmation              |
+---------------------+-----------------+------------------------------+
| 2. Exceeding Baht   | The Board of    | The Executive Board may give |
| 30million           | Directors       | prior approval               |
|                     |                 |                              |
|                     |                 | then the approved case       |
|                     |                 | should be submitted to       |
|                     |                 |                              |
|                     |                 | the Board of Directors for   |
|                     |                 | re-confirmation              |
+---------------------+-----------------+------------------------------+

(2) Marketing and Competition Situation

Table of Securities Business Statistics Summary

  --------------------------------- ----------- ----------- ----------- -----------
  Year                              2000        2001        2002        2003

  SET Index (point)                 269.19      303.85      356.48      772.15

  Securities Trading Volume(Million 923,697     1,577,758   2,047,442   4,670,281
  Baht)                                                                 

  Average daily Trading             3,740       6,440       8,357       18,908
  Volume(Million Baht)                                                  

  Market Capitalization(Million     1,279,224   1,607,310   1,986,236   4,789,857
  Baht)                                                                 

  Number of Listed Company          381         382         389         407

  Dividend Yield (%)                1.78        2.06        2.72        1.81

  P/E ratio (time)                  5.52        4.92        6.98        13.65
  --------------------------------- ----------- ----------- ----------- -----------

Source : The Stock Exchange of Thailand

2003 Stock Market Situation Summary

In the year 2003, Thailand’s Stock Market gave 117% yield, the highest
yield among other Asian countries in the region whilst the average daily
trading volume were increasing from Bht 5,981 million per day in QT1 to
Bht 10,413 million per day in QT2 and Bht 24,257 million per day in QT 3
to the highest Bht 34,236 million per day in the last quarter of the
year which resulted in the total yearly average trading volume of Bht
18,908 million (+126%).

[]

The above graph shows that the SET index in QT1/2003 was less volatile
because of the spreading of SARS disease. However, when the disease was
under control, the SET index started to gradually move upward in QT 2, 3
and 4. Though in QT 4, SEC had hinted a warning sign that there might be
new rules governing the net settlement trading and investors may have to
give 10% of their credit line as collateral as well as the investigation
on stock manipulations. However, such warning sign only had a short term
adverse effect on the SET index so that the SET index closed at 772.15
point as of 31 December, 2003 compared to 356.48 point of 2002 year-end.

The Reasons behind SET Index Upswing

1.  Investors believed that Thai economics would grow steadily in the
    year 2003 and had a tendency to continue growing in the year 2004.

2.  The credit rating institutions such as S& P, Moody’s and Fitch had
    continued to increase investment rating of Thai stock market so that
    both Thai and foreign investors were confided.

3.  Interest rates remain low so that some cash flows were plunged into
    the stock market.

4.  The domestic consumption stimulation policy of the Government
    especially the investment in SME as well as the income distribution
    into rooted level.

Stock Market Tendency for the year 2004

It was predicted that Thai stock market in the year 2004 will continue
to be bullish by the following reasons:

-   The Thai economic growth of 7-8% which was ranked the second next to
    only China plus the political stability will be the influencing
    factors which makes the Thai stock market an interesting market in
    the year 2004.

-   The low interest rate resulted from the high elasticity in the stock
    market has made the stock market to become an investment alternative
    for the investors who seek for high return. However, it is possible
    that toward the second half of the year 2004, the interest rate will
    be increased but will only have an insignificant impact on the stock
    market.

-   Even though there was an outbreak of Bird Flu disease from 2003
    year-end to the beginning of year 2004, the impact will be a short
    term one. We forecast that this incident will decrease expected GDP
    to about 0.1-0.2%.

-   EPS growth rate at 20% level makes Thai stock market a promising
    market for investment. Though SET index in the year 2003 had double
    increased, when consider the Prospective PE Ratio in this region, PE
    ratio of Thai stock market ranks the second next to only Indonesian
    Stock Market. Therefore, we forecast that SET index for the year
    2004 will probably reach 850-900 point.

Table Comparing PER in Various Stock Markets

As at 31 December, 2003

+----------------+------------+-------------+-----------+------------+
| Country        | Index      | % Chg.      | PER 03(X) | PER (X)    |
|                |            | Compared to |           |            |
|                | As of      | Dec.02      |           |            |
|                | 31/12/03   |             |           |            |
+----------------+------------+-------------+-----------+------------+
| Thailand       | 772.15     | +117%       | 12.2      | 10.7       |
+----------------+------------+-------------+-----------+------------+
| Singapore      | 1764.32    | +32%        | 15.3      | 13.3       |
+----------------+------------+-------------+-----------+------------+
| Hong Kong      | 12575.94   | +35%        | 16.5      | 15.3       |
+----------------+------------+-------------+-----------+------------+
| Malaysia       | 792.72     | +23%        | 14.4      | 12.8       |
+----------------+------------+-------------+-----------+------------+
| Indonesia      | 691.90     | +63%        | 10.3      | 9.3        |
+----------------+------------+-------------+-----------+------------+
| China          | 1419.12    | +11%        | 18.8      | 16.9       |
+----------------+------------+-------------+-----------+------------+

Source: Index from Apex, PER from Thompson Data Stream

Market Share Scattered Urged for Research Quality and PO Stocks
Allocation

From the total 36 broker firms, the top 5 brokers have the total market
share of 35% from the overall market volume in the year 2003 compared to
the market share has been somewhat scattered to the medium size broker
firms. Consequently, the quality of research paper as well as the
allocation of PO Stocks are apparently become the influencing factors
for the investors.

Fixed Commission Rate helps Release Competition

The rules of commission rate fixing at 0.25% of the trading volume for
traditional trading and 0.20% for internet trading which has been
activated for the past 3 years since 14 January, 2002 was the reversing
point which supported the survival of many securities broker firms. The
tremendous dropping of interest rate as well as the belief in economic
stability had helped stimulate the trading volume in the Thai stock
market since July, 2003 which resulted to an abrupt expansion of the
securities business. In 2003, therefore, the daily average trading
volume had rise to 18,908 million baht and thus also resulted in the
broker firms’ income growth.

However, there is still an uncertainty whether the liberalization of
commission rate will be returned in the year 2005 as planned. Most of
the broker firms are threatened for the survival of their business by
the past experience. It was clear that through liberalization commission
rate, broker firms had to face fierce competition during the year 2000
to 2001 with the average commission rate ranging from 0.33% to 0.14%
after SEC had abolished the fixed commission rate of 0.5% and changed to
liberalization rate.

Quality and Competent Services to Cope with the Future Liberalization
Commission

In amidst of the increasing competition, securities business owners will
need to improve the quality of research information and to develop the
internet trading system which was expected to be growing as well as the
improvement in the Investment Banking business which will equip the
securities firm with standard services and competence so as to be
capable of the continue expansion of market shares under liberalization
commission rate in the future.

Top 10 Market Share of Securities Firms

  --------- ------------ ------------- ---------- ------------ -------------
  Rank      Securities   Year 2002 (%) Rank       Securities   Year 2003 (%)
            Cos.                                  Cos.         

  1         KEST         12.68         1          KEST         11.44

  2         ZMICO        7.90          2          ZMICO        7.20

  3         AST          7.85          3          AST *        7.08

  4         KGI          7.57          4          KGI          5.22

  5         CNS          4.95          5          CNS          3.82

  6         UOBKHST      4.31          6          BLS          3.49

  7         TSC          3.93          7          TSC          3.36

  8         MLP          3.86          8          DBSV         3.26

  9         DBSV         3.73          9          SCBS         3.21

  10        PHILIP       3.56          10         PHATRA       3.06
  --------- ------------ ------------- ---------- ------------ -------------

Source :Stock Exchange of Thailand

Remark :* In 2005, AST will merge with ASSET that had 2.85% market share
in the year 2003.

Securities Business Trend

With the expected economic growth of 7-8% in the year 2004, analysts
predict that securities business’s operations result will be a jumping
growth which means that SET index might swing up to 850-1000 point.
Consequently, the daily average trading volume is also predicted to
continue growing for the year 2004 which also reflexes the growing trend
of securities business. Moreover, the listing into stock market of large
state enterprises such as EGAT, MEA, AOT, TOT, etc. will help stimulate
the stock trading in the stock exchange to some extent and will also
indirectly generate new investors.

In addition, the lively situation of the stock exchange will encourage
those companies that wish to sell their stocks in the market to speed up
the process which will finally accelerate the Underwriting business of
securities firms as well.

Daily Average Trading Volume

  []

  Remark : YTD is the daily average trading volume since 5 Jan. – 29
  Jan. 2004

Competition Strategies

The Company’s competitive strategies for securities broker business are
to provide fast and accurate information services in order to facilitate
the customer’s decision making on investment. The company is fully
equipped with efficient Marketing personnel and Securities Analysts
whose analyses will cover the main industries which are of high interest
to the customers. In addition, we also have a subsidiary company which
specializes in Investment Banking and underwriting business and because
we had taken up so many cases of IPO deals, we were continuously able to
offer the IPO shares to the public as well as to our customers to
subscribe. We also operate 4 branches upcountry namely Rangsit,
Nakornpathom, Nakornsawan and Haad Yai Branches in order to serve the
customers in provincial areas.

Underwriting Business

In the year 2003, the Company had engaged in the Underwriting deals
either as leader or co-underwriter of the IPO Securities of 16 companies
namely IT City PCL, EGV Entertainment, Bangpakong Terminal PCL, Bank of
Ayudhya PCL, Thitikorn PCL, CP Seven Eleven PCL, KrungThai
Bank,NakornThai Strip Mill PCL, TKS Technologies PCL, Thai Olefins PCL,
Siam City Bank PCL, Kim Eng Securities PCL, Tycoons Worldwide Group PCL,
SINGHA Paratech PCL, Quality Construction PCL,Sahacogen (Chonburi) PCL,
the total value of 982.5 million bath. Moreover, there was 1 deal on
Private Placement of HEMRAJ Land & Development PCL. at the value of 50
million bath, underwriting of 2 cases of Debenture Stock, namely Asian
Property Development PCL and BANPU PCL and another case as Subscription
Agent of Christiani & Nielsen (Thailand) PCL.

The competition situation of the Financial Advisory Business

The competition situation of the Financial Advisory and Underwriting
Businesses tend to be more extensive in the future as most of the medium
to small size securities companies are heading toward these fields of
businesses because they can compensate the income with the income from
securities business. However, both the Financial Advisory and
Underwriting businesses are flexible in relation to the securities
market as well. Even so, we still believe that with our high caliber and
expertise in Financial Advisory business, we are able to compete with
others.

The company’s target groups are those listed companies and any other
companies who wish to raise fund through capital market and money
market.

(3) Procurement of Products or Services

Sources of Capital

For the past 2 years the company had not engaged in any outside source
of capital. Most capital came from the shareholders’ equity and was
utilized on investment of debt instrument, and underwriting of common
stocks and debt instrument and the rest was used as working capital. The
loan from other financial institution, if any, would be a short term
one. The sources of capital policy is to choose the source which is more
suitable in relation to the business activities and its objectives and
which will not affect the ratio between total liabilities and
shareholders’ equity as well as the NCR ratio.

Margin loan Policy

In 2003, the Company had allowed margin loan under Credit Balance system
on best cautions. Towards year end, the total Credit Balance outstanding
were amounted to 1,712 million Baht.

The Maintenance of Net Capital Rule

The Company will maintain its Net Capital Rule (NCR) to be up to the
Securities & Exchange Commission’s standard on a daily basis. The types
of assets and the capital of the company will be evaluated everyday in
order to control the company’s NCR to be in line with the standard rate
and timely.

The NCR as of FY2003 year end was 135.90%. As for the Company’s NCR
management policy, the company has arranged for various sources of
capital such as to open up credit lines with some financial institutions
or the sources of capital from shareholders’ equity through increasing
of company’s capital by rights issue or Public offering through the SET
at the right timing and through the most suitable financial instruments.