· DUKE 3 possesses good traffic profile and comfortable refinancing headroom, although its

DUKE 3 – Good traffic; modest debt cover

·         DUKE 3 possesses good traffic profile and comfortable refinancing headroom, although its financial metric is at the weaker end among AA3/AA- peers.

·         The credit of DUKE 3 at best, because of construction risk, is between Kesturi and MEX II in our view. However, technical is supportive with ~3.6x book cover and limited supply of high-yielding toll road bonds.

·         In secondary market, the DUKE 3 curve rallied 33-48bps from sell-down levels and last traded close to the Kesturi curve, which we think is slightly rich and we see better relative value in MEX II.