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, 2004 were shown in the table
below:

Table of Market Share Value

  ---------------------------- ----------- ----------- ----------- -----------
  Securities Trading Volume    2001        2002        2003        2004

  SET (Million Baht)           1,579,144   2,053,357   4,670,281   5,024,399

  US (Million Baht)            68,322      142,044     201,645     137,802

  US Market share (%)          2.16%       3.45%       2.16%       1.37%
  ---------------------------- ----------- ----------- ----------- -----------

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 Securities Customer Policy

It is the Company’s policy to welcome all types of customer, 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 credit 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 securities which are qualified to be put as collaterals. Followings
are the policies to be considered before granting Credit Balance to
customers:

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 Approval 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 Directors and was last updated on 13 January,
2005 and which shown in table 1.

+-------+-------+-------+-------+-------+-------+----------+----------+
| TABLE | App   |       |       |       |       |          |          |
| 1     | roval |       |       |       |       |          |          |
|       | A     |       |       |       |       |          |          |
|       | uthor |       |       |       |       |          |          |
|       | ities |       |       |       |       |          |          |
|       | of    |       |       |       |       |          |          |
|       | Secur |       |       |       |       |          |          |
|       | ities |       |       |       |       |          |          |
|       | Bus   |       |       |       |       |          |          |
|       | iness |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| 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      | Head of  |
| exce  | stant | stant | stant |       |       | e        | M        |
| eding | Vice  | Vice  | Vice  |       |       | xceeding | arketing |
|       | Pres  | Pres  | Pres  |       |       | 30,000   | co-sign  |
| 2     | ident | ident | ident |       |       | Baht     | with     |
| mi    |       |       |       |       |       |          | Managing |
| llion |       |       |       |       |       |          | Director |
| Baht  |       |       |       |       |       |          | or       |
|       |       |       |       |       |       |          | P        |
|       |       |       |       |       |       |          | resident |
|       |       |       |       |       |       |          | or       |
|       |       |       |       |       |       |          | E        |
|       |       |       |       |       |       |          | xecutive |
|       |       |       |       |       |       |          | Director |
|       |       |       |       |       |       |          | and Head |
|       |       |       |       |       |       |          | of       |
|       |       |       |       |       |       |          | M        |
|       |       |       |       |       |       |          | arketing |
|       |       |       |       |       |       |          | su       |
|       |       |       |       |       |       |          | mmarizes |
|       |       |       |       |       |       |          | the      |
|       |       |       |       |       |       |          | tran     |
|       |       |       |       |       |       |          | sactions |
|       |       |       |       |       |       |          | to be    |
|       |       |       |       |       |       |          | ackn     |
|       |       |       |       |       |       |          | owledged |
|       |       |       |       |       |       |          | by the   |
|       |       |       |       |       |       |          | E        |
|       |       |       |       |       |       |          | xecutive |
|       |       |       |       |       |       |          | Board    |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Vice  | Vice  | Vice  | Vice  | Vice  | Head of  |          |
| exce  | Pres  | Pres  | Pres  | Pres  | Pres  | M        |          |
| eding | ident | ident | ident | ident | ident | arketing |          |
|       |       |       |       |       |       | co-sign  |          |
| 5     |       |       |       |       |       | with     |          |
| mi    |       |       |       |       |       | Managing |          |
| llion |       |       |       |       |       | Director |          |
| Baht  |       |       |       |       |       | or       |          |
|       |       |       |       |       |       | P        |          |
|       |       |       |       |       |       | resident |          |
|       |       |       |       |       |       | or       |          |
|       |       |       |       |       |       | E        |          |
|       |       |       |       |       |       | xecutive |          |
|       |       |       |       |       |       | Director |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | S     | S     | S     | S     | S     | Not      |          |
| exce  | enior | enior | enior | enior | enior | e        |          |
| eding | Vice  | Vice  | Vice  | Vice  | Vice  | xceeding |          |
|       | Pres  | Pres  | Pres  | Pres  | Pres  | 30,000   |          |
| 8     | ident | ident | ident | ident | ident | Baht     |          |
| mi    |       |       |       |       |       |          |          |
| llion |       |       |       |       |       |          |          |
| Baht  |       |       |       |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Head  | Head  | Head  | Head  | Head  | Head of  |          |
| exce  | of    | of    | of    | of    | of    | M        |          |
| eding | Mark  | Mark  | Mark  | Mark  | Mark  | arketing |          |
|       | eting | eting | eting | eting | eting | co-sign  |          |
| 15    |       |       |       |       |       | with     |          |
| mi    |       |       |       |       |       | Managing |          |
| llion |       |       |       |       |       | Director |          |
| Baht  |       |       |       |       |       | or       |          |
|       |       |       |       |       |       | P        |          |
|       |       |       |       |       |       | resident |          |
|       |       |       |       |       |       | or       |          |
|       |       |       |       |       |       | E        |          |
|       |       |       |       |       |       | xecutive |          |
|       |       |       |       |       |       | Director |          |
|       |       |       |       |       |       | and Head |          |
|       |       |       |       |       |       | of       |          |
|       |       |       |       |       |       | M        |          |
|       |       |       |       |       |       | arketing |          |
|       |       |       |       |       |       | su       |          |
|       |       |       |       |       |       | mmarizes |          |
|       |       |       |       |       |       | the      |          |
|       |       |       |       |       |       | tran     |          |
|       |       |       |       |       |       | sactions |          |
|       |       |       |       |       |       | to be    |          |
|       |       |       |       |       |       | ackn     |          |
|       |       |       |       |       |       | owledged |          |
|       |       |       |       |       |       | by       |          |
|       |       |       |       |       |       | E        |          |
|       |       |       |       |       |       | xecutive |          |
|       |       |       |       |       |       | Board    |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| Not   | Head  | Head  | Man   | Head  | Head  |          |          |
| exce  | of    | of    | aging | of    | of    |          |          |
| eding | Mark  | Mark  | Dir   | Mark  | Mark  |          |          |
|       | eting | eting | ector | eting | eting |          |          |
| 20    | co    | co    | or    | co    | co    |          |          |
| mi    | -sign | -sign | Pres  | -sign | -sign |          |          |
| llion | with  | with  | ident | with  | with  |          |          |
| Baht  | Man   | Man   | or    | Man   | Man   |          |          |
|       | aging | aging | Exec  | aging | aging |          |          |
|       | Dir   | Dir   | utive | Dir   | Dir   |          |          |
|       | ector | ector | Dir   | ector | ector |          |          |
|       | or    | or    | ector | or    | or    |          |          |
|       | Pres  | Pres  |       | Pres  | Pres  |          |          |
|       | ident | ident |       | ident | ident |          |          |
|       | or    | or    |       | or    | or    |          |          |
|       | Exec  | Exec  |       | Exec  | Exec  |          |          |
|       | utive | utive |       | utive | utive |          |          |
|       | Dir   | Dir   |       | Dir   | Dir   |          |          |
|       | ector | ector |       | ector | ector |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+
| 20    | Exec  | Exec  | Man   | Man   | Man   |          |          |
| mi    | utive | utive | aging | aging | aging |          |          |
| llion | Board | Board | Dir   | Dir   | Dir   |          |          |
| Baht  |       |       | ector | ector | ector |          |          |
| and   |       |       | or    | or    | or    |          |          |
| above |       |       | Pres  | Pres  | Pres  |          |          |
|       |       |       | ident | ident | ident |          |          |
|       |       |       | or    | or    | or    |          |          |
|       |       |       | 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    |       |       |          |          |
| above |       |       | Pres  |       |       |          |          |
|       |       |       | ident |       |       |          |          |
|       |       |       | or    |       |       |          |          |
|       |       |       | Exec  |       |       |          |          |
|       |       |       | utive |       |       |          |          |
|       |       |       | Dir   |       |       |          |          |
|       |       |       | ector |       |       |          |          |
+-------+-------+-------+-------+-------+-------+----------+----------+

Remark : The approved credit line for new cash account opening in each
level above will also apply to the temporary credit line approval and
each temporary credit line approved to each customer should not exceed
the total approved credit line of that customer.

Definitions in Table 1 - The Approval Authorities of Securities Business

  ------------------------------- ------- --------------------------------
  Credit Line                     means   securities trading limits
                                          approved for 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 of Marketing
                                          Department

  Head of Marketing               means   First Executive Vice President
                                          or Executive Vice President of
                                          Marketing Department

  Executive Board                 means   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 Company’s temporary and long-term investment activities both in
listed securities at the Stock Exchange of Thailand (SET), the Market
for Alternative Investment (MAI) or the Bond Dealers’ Club, and
non-listed equity and debt instruments are controlled by an Investment
Committee appointed by its Board of Directors to ensure that they will
correspond with its investment policy as follows.

1.  To determine cash management framework that is in line and not
    conflicting with the authorities’ terms and conditions, especially
    with regard to the NCR condition where the Company must maintain its
    NCR at a level not lower than the level prescribed by the
    authorities. The Company’s initial goal is to control its NCR to be
    within 100-150 per cent. In case there is any investment which
    prompts its NCR to become lower than 100 per cent, such investment
    must be approved by the Executive Board prior to its investment.

2.  The Company will make sure that its reserves are adequate for
    operating its securities brokerage business, credit balance
    business, underwriting business and as its working capital for three
    months. For remaining cash balance in these businesses, the Company
    will use it in treasury investment and other business allowed by the
    authorities.

3.  The Company has determined its investment policy, investment ratio
    as well as rules and regulations as a guideline for its management,
    which can be divided into the following types of financial
    instruments:

  3.1 Long-term debt instruments (maturity period is more than one
  years): investment ratio will not exceed 40 per cent and the debt
  instruments must be rated at least at BBB+ by a credit rating agency
  accepted by the authorities. In case the instrument is not rated, the
  Company must seek investment approval from the Executive Board.

  3.2 Short-term debt instruments (maturity period is equal to or less
  than one year): investment ratio will not exceed 30 per cent and the
  Debt Service Coverage Ratio (DSCR) must be more than 1.2 times. If the
  instrument’s DSCR is less than 1.2, the Company must seek investment
  approval from the Executive Board.

3.  Equities: investment ratio must not exceed 30 per cent.

Important Conditions

The Company may adjust its investment ratio as appropriate to
circumstances at the time for operation flexibility and for maximum
benefit. However, readjustment of its investment ratio must be subject
to the Investment Committee’s approval.

The Company’s Current Status and its Working Capital in 2005

-   Net capital is approximately Baht 700 million

-   The Company will reserve approximately Baht 220 million for its
    securities brokerage business. Regarding the credit balance
    business, the target is 30 per cent of the total trading volumes of
    its customers where it should also be able to accommodate
    distribution and underwriting businesses for no more than Baht 1.5
    billion during the same period. In addition, working capital to
    accommodate three months’ expenses of around Baht 60 million must
    also be available.

  3.4 The Company’s securities investment policy

- Investments in securities will be divided into two types as follows.

  1. Temporary investment

  2. Long-term investment

  - Scope of investment: investment will be made in listed and
  non-listed securities in the SET, the MAI or the Bond Dealers’ Club,
  which record good fundamentals, outstanding financial status,
  appropriate liquidity, high growth potential and right price.

  In case of non-listed securities in the SET, the MAI or the Bond
  Dealers’ Club, the Company must seek investment approval from the
  Executive Board.

- Risk management

1.  Diversify investment risk appropriately based on investment periods
    and types of securities

2.  Limit loss

3.  Use analysis information to support investment decisions

- Report results of securities trading and investment to the Board of
Directors on a monthly basis.

Investment Advisor

The investment advisory business is to offer specific advice to major
customers by taking into consideration desire, objective, ability to
absorb risk, financial status and investment experience of a particular
investor to come up with appropriate tailor-made recommendations for
stock selection and asset allocation for that customer.

Offered services include providing investment strategies, adjusting
investment weight, monitoring and evaluating investment results,
selecting appropriate investment style and organizing training and
seminars about economic and investment trends in the stock exchange or
other issues interested by investors to customers.

The Company plans to start providing the investment advisory service at
the second half of 2005.

Financial Advisor and Securities Underwriter

The Company and its subsidiary offer a financial advisory service
through their investment banking units where the Company has 12
investment bankers and its subsidiary has another 14 investment bankers.

The Company and its subsidiary provide financial advisory service,
shareholders’ restructuring, fund mobilization through the issuance of
debt and equities such as ordinary shares, preferred shares, debentures,
warrant-cum-debentures and etc and the listing of such instruments and
securities in the SET and the MAI.

The Company has a policy to distribute and underwrite both debt and
equity instruments as well as offers investment advice.

The approval authorities for underwriting were set up as follows:

  ---------------------- ------------------ ------------------------------
  Underwriting Value     Authorized Signers Emergency Case

  1. Not exceeding 20    President or       President or Managing Director
  million Baht           Managing Director  may give prior approval for
                         co-sign with one   action to be taken then the
                         Executive Director approved case should acquire
                                            another signature from one of
                                            the Executive Directors

  2. Exceeding 20        Executive Board    President or Managing Director
  million Baht but not                      may give prior approval then
  over 100 million Baht                     the approved case should be
                                            submitted to the Executive
                                            Board for re-confirmation

  3. Exceeding 100       Executive Board    Executive Board may give prior
  million Baht                              approval then the approved
                                            case should be submitted to
                                            the Board of Directors for
                                            re-confirmation.
  ---------------------- ------------------ ------------------------------

Remark : Underwriting Value equals to the underwritten amount multiplied
by offering price of the security

(2) Market and Competition

Summary of Stock Market Condition in 2004

The Stock Exchange of Thailand’s (SET) index fell 13.5 per cent in 2004
after rallying by as much as 117 per cent from a year before due to both
local and international factors. This included  weaker Thai Baht which
was down to the lowest rate of Baht 41.77 a US dollar in August before
gradually recovering and becoming stronger as the year ended at Baht
38.85 a US dollar;  China’s announcement to tighten its economic policy
which led to a worry that the world’s economy may be near its peak;  a
problem of the Southern unrest starting on 28 April which led to a
violent crash when 107 perished;  a recurrence of the avian influenza
epidemic;  the gradual rice of oil price, as the case of West Texas
crude oil, from US$ 32.4 a barrel in the beginning of the year to as
high as US$ 55 a barrel before falling to hover around US$ 43.4 a barrel
at the year end and  increasing non-performing loans (NPLs) in certain
banks which were required to set aside additional reserves and affected
investment in banking stocks.

The SET index in January steadily fell from 800 points to as low as 576
points in April before starting to experience stability and eventually
edging up in the second half of 2004. The index clearly rose in November
(graphic) thanks to steady appreciation of the Thai Baht and cheap Thai
stocks compared to other regional bourses, promoting foreign liquidity
to flow back into the Thai market. The SET index incessantly rose and at
the end of 2004 was at 668.10 points with an average trading volume of
Baht 20.508 billion a day (+8.5 per cent). It was hardly affected
despite the Tsunami disaster hitting the six southern provinces of
Thailand at the end of December.

[]

Stock Market Trend in 2005

We expect the SET index in 2005 to be better than in 2004. We target the
index to climb up to 750-780 points thanks to the following supporting
factors:  Asia economy remains the world’s growth-driven economy this
year especially the Chinese economy where its 2005 GDP is expected to
expand at 8 per cent as compared to 2004’s 9 per cent even though
investors were previously worried about the

world’s economic slowdown;  Asia economies remain more robust than
others, which should make Asia currencies including Thai Baht become
stronger in 2005 and therefore attract foreign money into Asia’s bourses
including the SET;  although Thailand’s economy may be affected by the
Tsunami tragedy which hit the six southern provinces during the first
half, yet, increasing state expenditure is expected to propel Thailand’s
GDP growth by 5-5.5 per cent per annum as compared to 6 per cent last
year; and  profits of listed companies in the SET in 2005 are expected
to grow by 9-10 per cent, which, on the basis of the PEG ratio, makes
the Thai bourse the third cheapest bourse among the eight regional stock
markets (as of 14 January 2005).

However, there are certain risk factors which may put pressure to the
SET and therefore its index. They are  crude oil price, which, even
though fell from the highest level, remains very high and is likely to
be volatile on the basis of political development in the Middle East and
the US’s oil reserves and thus could lead people to become re-worried of
economic slow-down once again especially in the case of Thailand where
the government plans to float local diesel price which will affect costs
of industrial transportation but we expect the new government to put off
the hike for a clearer economic snapshot after the Tsunami disaster in
the South;  Thailand’s stock prices start to be near its appropriate
level as its PEG ratio is closed to 1 and therefore any index hike will
make Thai shares look too expensive if the country’s fundamentals fail
to change from what is expected;  an increase of the SET index from the
end of the year to earlier 2005 was more liquidity-driven as a result of
appreciated Thai Baht than earning-driven, which may induce capital
outflow if Thai Baht changes its direction.

Securities Business in 2004

-   Securities trading in 2004 staidly fell from Q1 of 2004 at Baht
    28.38 billion per day to Baht 18.28 billion per day in Q4 of the
    same year due to major factors ranging from the bird flu to the
    civil unrest in the South and volatility of oil price in the world
    market. The SET index at the end of 2004 was 668.1 points or down by
    13.5 per cent from the end of 2003, which was one of the world’s
    most-declining indexes as happened to China’s although stock indexes
    of other regional bourses performed much better. For example, the
    JKSE (of Indonesia) rose 44.6 per cent and the PHCOMP (the
    Philippines) jumped 26.4 per cent while indexes of several other G-7
    countries increased by 3-8 per cent.

  -----------------------------------------------------------------------
  Significant Changes of Important Indices in FY2004

  []

  Sources : Stock Exchange of Thailand
  -----------------------------------------------------------------------

[]

-   An average trading volume for the entire year of 2004 was Baht 20.65
    billion or an 8.51-per cent increase. Securities values based on
    market prices at the end of 2004 was Baht 4,533.6 million or a
    decline by 5.6 per cent. The top five brokers with the highest
    market shares included KEST (11.71 per cent), ASP (8.08 per cent),
    ZMICO (5.96 per cent), KGI (4.52 per cent) and SCBS (4.04 per cent).
    Brokers which transformed into public company and had their shares
    traded in the stock market included GBX and SYRUS.

+------+-------+------+------+-------+------+------+-------+------+
| 2002 |       |      | 2003 |       |      | 2004 |       |      |
+------+-------+------+------+-------+------+------+-------+------+
| No.  | Ab    | Ma   | No.  | Ab    | Ma   | No.  | Ab    | Ma   |
|      | brev. | rket |      | brev. | rket |      | brev. | rket |
|      |       | S    |      |       | S    |      |       | S    |
|      |       | hare |      |       | hare |      |       | hare |
+------+-------+------+------+-------+------+------+-------+------+
| 1.   | KEST  | 12   | 1.   | KEST  | 11   | 1.   | KEST  | 11   |
|      |       | .70% |      |       | .46% |      |       | .71% |
+------+-------+------+------+-------+------+------+-------+------+
| 2.   | ZMICO | 7    | 2.   | ZMICO | 7    | 2.   | ASP   | 8    |
|      |       | .93% |      |       | .20% |      |       | .08% |
+------+-------+------+------+-------+------+------+-------+------+
| 3.   | ASP   | 7    | 3.   | ASP   | 7    | 3.   | ZMICO | 5    |
|      |       | .84% |      |       | .07% |      |       | .96% |
+------+-------+------+------+-------+------+------+-------+------+
| 4.   | KGI   | 7    | 4.   | KGI   | 5    | 4.   | KGI   | 4    |
|      |       | .57% |      |       | .23% |      |       | .52% |
+------+-------+------+------+-------+------+------+-------+------+
| 5.   | CNS   | 4    | 5.   | CNS   | 3    | 5.   | SCBS  | 4    |
|      |       | .93% |      |       | .81% |      |       | .04% |
+------+-------+------+------+-------+------+------+-------+------+

Source: The Stock Exchange of Thailand

-   The top five securities attracting the highest investment accounted
    for 61.73 per cent of the total trading values included commercial
    bank stocks, which was the most popular investment choice in 2004,
    where daily trading volumes topped Baht 3.3 billion or 10 per cent
    of the total trading volumes. The energy stocks accounted for 13.4
    per cent as they were traded at a daily volume of 2.75 billion,
    followed by communications stocks at Baht 2.37 billion trailing
    volume per day or 11.6 per can, finance and securities stocks at
    Baht 2.19 billion trading volume per day or 10.7 per cent and
    property stocks at Baht 2.1 billion trading volume per day or 10.1
    per cent.

+-------+--------------------------+----------------+-----------------+
| No.   | Business Sector          | Daily Trading  | % of Total      |
|       |                          | Volume         | Trading Volume  |
+-------+--------------------------+----------------+-----------------+
| 1.    | Commercial bank          | 3,292          | 16.05%          |
+-------+--------------------------+----------------+-----------------+
| 2.    | Energy                   | 2,750          | 13.41%          |
+-------+--------------------------+----------------+-----------------+
| 3.    | Communications           | 2,371          | 11.56%          |
+-------+--------------------------+----------------+-----------------+
| 4.    | Finance and Securities   | 2,186          | 10.66%          |
+-------+--------------------------+----------------+-----------------+
| 5.    | Property                 | 2,062          | 10.05%          |
+-------+--------------------------+----------------+-----------------+
|       | Total                    | 12,661         | 61.73%          |
+-------+--------------------------+----------------+-----------------+

Source: The Stock Exchange of Thailand

-   An attempt to add products into the stock market remains the SET’s
    major policy. In 2004, many IPO stocks ended up closing at a lower
    than their subscription price from the first trading day and thus
    prompting people to postpone their listing in the exchange. Based on
    the SET’s information, in 2004, there were 36 newly-listed firms
    while seven were delisted. As a result, 439 companies remained
    listed in the stock exchange, which rose from 2003’s 407 companies.

Table of Significant Statistics from The Stock Exchange of Thailand

  ----------------- ----------------- ----------------- -----------------
                    2002              2003              2004

  SET Index         356.48            772.15            668.10

  % of Growth Rate  17.3%             116.6%            -13.5%

  SET 50 Index      22.84             50.91             46.87

  % of Growth Rate  15.8%             122.9%            -7.9%

  MAI Index         127.49            343.7             188.07

  % of Growth Rate  n.a.              169.6%            -45.3%

  % of Dividend     2.72              1.81              2.75

  P/E Ratio (times) 6.98              13.65             9.40

  P/BV Ration       1.36              2.71              2
  (times)                                               

  Average trading   8,357             18,908            20,508
  value per day                                         
  (MB)                                                  

  No. of            18                21                36
  newly-listed cos.                                     
  (companies)                                           

  No. of delisted   11                5                 7
  cos. (companies)                                      

  Remaining         389               407               439
  companies                                             
  (companies)                                           
  ----------------- ----------------- ----------------- -----------------

Trend of Securities Business in 2005

-   Based on our estimation, daily trading volumes in 2005 will be
    around Baht 21-23 billion a day, or an increase of 2.4-12 per cent
    from the previous year. Securities values at market price at the end
    of 2005 will be Baht 5.5 trillion. Major supporting factors will
    still be steady GDP growth and increasing number of newly-listed
    shares in the SET and the MAI; large public and private sector
    businesses currently dressed up for listing in the SET; ranging
    from, for example, Thai Beverage to the Communications Authority of
    Thailand, the Telephone Organization of Thailand; and clearer
    government picture after the 6 February 2005’s election. However,
    competitions for services and market shares remain as fierce as
    ever. Starting in early 2005, three new securities companies have
    already been opened up; namely, Kasikorn Securities, TSEC Securities
    and Asia Credit Securities. Both Kasikorn Securities and Asia Credit
    Securities are backed up by commercial banks.

-   Positive factors for stock trading in 2005 include continuity of
    government policy following the emergence of election results;
    Thailand’s steady economic growth thanks to investments by both
    public and private sectors which will be the country’s strong engine
    of growth and therefore should enhance confidence from both local
    and international investors; and the SET’s own policy which sets a
    medium goal to make securities values based on market prices (Baht
    4.5 trillion) to remain at the same level of the current GDP (Baht
    6.5 trillion). Meanwhile, faster settlement date, which is changed
    from T+3 days to T+2 days, is initially considered a positive factor
    as the more frequent investors invest their money, the more
    securities companies are to enjoy their commission fees. Besides,
    the postponement to liberalize brokerage fee by another two years
    until 13 January 2007 helps lessening a fierce competition from
    increasing number of brokerage companies. However, fundamentals of
    listed companies in the SET remain the very factor to create and
    maintain investment confidence. During the first nine month of 2004,
    net profits of listed companies in the SET and the MAI rose 41 per
    cent year-on-year, which truly reflected Thailand’s solid business
    growth.

  Negative factors are those already taken place in 2004; namely, price
  volatility of major raw materials necessary for production process in
  the world’s market especially crude oil; the floating of local diesel
  price that will inevitably affect transport-dependent businesses; the
  bird flu’s effect to the poultry business; management of civil unrest
  in the South following the country’s election and a gradual increase
  of the US’s interest rates which will inevitably force Thai rates to
  also climb up.

  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, the Company and its
  subsidiaries also have professional teams who specialize 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 5 branches upcountry namely Rangsit, Nakornpathom, Nakornsawan
  Haad Yai and Chonburi Branches in order to serve the customers in
  provincial areas.

Underwriting Business

  In the year 2004, the Company had engaged in the Underwriting deals
  either as lead underwriter or co-underwriter of the IPO Securities of
  16 companies, as follows :

TPI Polene PLC. Grand Asset Development PLC.

  Bang Chak PLC. Airports of Thailand PLC.

  NC Housing PLC. PICO (Thailand) PLC.

  Nava Nakorn PLC. LV Technology PLC.

  K-Tech Construction PLC. Asian Insulator PLC.

  Globlex Holding Management PLC. Focus Engineering & Construction PLC.

  Bangkok Chain Hospital PLC. Bliss-Tel PLC.

  Thainox Stainless PLC. United Paper PLC.

  Totaling 475.54 million Baht. Moreover, there were 3 Tender offer
  deals, namely Thai Canepaper PLC., The Minor Food Group PLC. And
  Rajdamri Hotel PLC. Totaling 740.61 million Baht. In addition, there
  were 3 underwriting deals of Bond, namely Land & House PLC., Quality
  House PLC., Asian Property Development PLC., totaling 775 million
  Baht.

  Five securities underwritten by the Company had an average closing
  price on the first trading day higher than the stock market’s average
  closing IPO price by as much as 55 per cent thanks to our thorough
  review that the underwritten companies were having good fundamentals
  and investors had a strong desire to invest in these shares.

Competition in the Financial Advisory Business

Competition in the financial advisory business and the securities
underwriting business tends to become fiercer in the future as several
securities companies especially medium to small companies start to focus
more on these businesses to provide supporting incomes to securities
trading business while at the same time creating revenues from financial
fees to compensate those from securities business. However, the business
of financial advisory and securities underwriting remains volatile
according to the SET’s regulatory directions. For us, we believe that we
have experienced teams of financial advisors to compete with our
competitors.

Regarding target customers, the Company focuses both on listed customers
in the stock exchange and companies in general which want to mobilize
funds from both equity and money market. We aim to win new underwriting
deals and at the same time focus on customers who may need financial
advisory services for other non-securities businesses such as financial
restructuring, non-IPO deal and merger and acquisition.

(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 2004, the Company had allowed margin loan under Credit Balance system
on best cautions. Towards year end, the total Credit Balance outstanding
were amounted to 558 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 FY2004 year end was 510%. 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.