1.  RISK FACTORS

  1. Slow down of the tourism industry

  In the past year, Thailand’s tourism industry has been affected
  primarily by three issues: the political instability, the slow down of
  the global economy and the pandemic H1N1 flu. Although medical tourism
  is not as easily affected as the mainstream tourism industry owing to
  an established relationship between patients and the hospital and
  physicians, these events can cause a postponement or a reduction in
  the number of patients traveling to Thailand and can in turn affect
  revenues from international patients.

  In order to minimize the risk, the Company maintains a balanced
  portfolio of international and Thai patients so that the Company does
  not rely excessively on revenue from international patients. In the
  past year, the Company has focused on marketing activities for the
  domestic market. As a result, Thai patients in terms of volume
  remained consistent at 60% of total volume in 2009.

  2. Intensified competition in the premium healthcare sector

  With the current environment where purchasing power has been slowing
  due to political and global economic uncertainties, while the supply
  of private hospitals remains high, competition in the private
  healthcare sector continues to intensify. The risk of the Company
  losing its clients to other competitors therefore increases.

  In order to maintain its leading position in Thailand and Asia and to
  mitigate the risk, the Company has invested in up-to-date equipment
  and information technology, upgraded both inpatient and outpatient
  facilities as well as continuously improved its quality of care. The
  Company was the first hospital in Asia to receive US standard
  accreditation from Joint Commission International Accreditation
  (JCIA), and was the first private hospital in Thailand to receive Thai
  Hospital Accreditation (HA). In addition, the Company has a strong
  client base of referral patients both from within Thailand and
  internationally. This signifies the reputation of the Company as the
  leader both within Thailand and in the region.

  3. Shortage of professional staff

  The hospital business requires personnel with specific technical
  expertise and knowledge, including nurses, pharmacists and various
  technicians. A shortage of these professionals is possible due to the
  increasing demand. In addition, because the Company sees the
  importance of its international client base, multi-lingual
  professionals are also required.

  In order to minimize the risk, the Company offers competitive
  compensation and benefits for its staff. The Company also provides
  education and training, recreation, staff engagement and staff welfare
  activities to all staff members, on par with other competitors.
  Through a decentralized management structure, the Company also offers
  excellent career paths to various categories of staff members. In
  2009, the Company received “Best Practice Workplace Award on Labor
  Relations and Labor Welfare Award” in the “large-enterprise without
  Federation of Labor Union’ category by the Ministry of Labor.

  4. International investments

  Bumrungrad International Limited has investments in seven countries in
  Asia. Such investments carry the inherent risk of investment and
  expose the Company to country and currency risk outside Thailand.

  To mitigate this risk, Bumrungrad International Limited’s experienced
  international management team conducts extensive feasibility studies
  and carries out detailed due diligence using firms with local
  knowledge before recommending Company’s investment. Risk is also
  reduced by engaging local equity partners in most overseas
  investments. In addition, credit risk is reduced by only leveraging in
  its subject countries without corporate guarantees by Bumrungrad
  International Limited or the Company.

  5. Legal disputes

  Hospital business is subject to litigation risk attendant to the
  provision of healthcare services by hospital staff and physicians.

  Therefore, in order to minimize the risk, the Company has implemented
  a healthcare risk management system to ensure that the risk of
  mistakes by the Company’s personnel is minimized and corrected. In
  addition, the Company has various insurance policies in place against
  possible legal lawsuits.