Tata Steel
BSE SENSEX
33,845
S&P CNX
10,397
21 February 2018
Update
| Sector:
Metals
CMP: INR641
TP: INR778(+21%)
Neutral
Strategic bids for Bhushan may drag stock performance
However, it is a long-term positive. Maintain Neutral
Sketchy picture of likely acquisitions
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
12M Avg Val (INR m)
Free float (%)
TATA IN
971
747 / 404
-5/-1/21
623
9.7
3263.0
68.7
Financials Snapshot (INR b)
Y/E Mar
2018E 2019E 2020E
Net Sales
1,286 1,279
691
EBITDA
215
228
164
PAT
69
84
74
EPS (INR)
57.7
69.4
61.5
Gr. (%)
51.9
20.4 -11.5
BV/Sh (INR)
397
457
509
RoE (%)
15.9
16.3
12.7
RoCE (%)
11.8
11.7
9.7
P/E (x)
11.1
9.2
10.4
P/BV (x)
1.6
1.4
1.3
Shareholding pattern (%)
As On
Dec-17 Sep-17 Dec-16
Promoter
31.4
31.4
31.4
DII
28.5
29.7
30.8
FII
17.1
15.7
13.1
Others
23.1
23.3
24.8
FII Includes depository receipts
Stock Performance (1-year)
Tata Steel
Sensex - Rebased
800
700
600
500
400
According to media reports, Tata Steel (TATA) has emerged as the top bidder in
the recent IRP (Insolvency Resolution Professional)-administered auction of
two steel assets, i.e., Bhushan Steel Ltd (BSL), the listed entity promoted by
Neeraj Singhal, and Bhushan Power and Steel (BPS), the unlisted entity
promoted by Sanjay Singhal. Although details of the deals are still sketchy, it
appears that TATA will own a 74% stake in the debt-laden (though reduced to
INR362b) BSL and an 88% stake in BPS (INR182b debt), with commitment to
bring additional capital (not sure if equity or debt or preference share) toward
working capital and pending capex. On consolidation, net debt will increase by
INR544b (or more) at the end of FY20, assuming that additional capital
requirement for working capital and capex will be met from internal accruals
once the interest burden comes down on refinancing.
Valuations may appear expensive, but are in line with replacement cost
BSL and BPS are essentially non-integrated flat steel product producers. We
believe that these assets can produce 7-8mt saleable steel with current
facilities. The business models are similar to JSW Steel. Operating cost for JSW
Steel is lower as its furnaces are much larger, while it pays slightly more for
iron ore due to its location. JSW Steel pays less outward freight due to
proximity to market. Therefore, we believe BSL and BPS’ EBTIDA per ton are
likely to be either same or a tad lower than JSW Steel’s margins of INR7,000-
9,000/t across cycle. Assuming INR8,000 average EBITDA/t across the cycle for
BSL and BPS, the valuation of INR544b is at ~8.5xEV/EBITDA (or more
expensive) after factoring in FCF of the target for two years. Naturally, this
appears expensive compared to sector average EV/EBITDA valuation multiple
of 6 to 7x, and this acquisition is likely to drag the stock performance over the
near-to-medium term. According to our calculations, the target price may get
eroded by 13% to INR677, based on 6.5xEV/EBTIDA and book value for CWIP.
Peak debt will be INR920-1,000b in FY20E (excluding European business).
Although valuations appear expensive, they are in line with the replacement
cost. It makes strategic sense for TATA as it can leverage its captive iron ore
mines (subject to getting statutory permissions) and drive market synergies.
Captive iron ore mining leases have only 12 years of remaining validity. Over 5-
10 years, the additional INR50-80b upfront cost will not matter much, and
perhaps, it can be offset by additional mining profit. This will catapult TATA’s
capacity from 13mtpa to 25mtpa in 3-4 years.
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Sanjay Jain – Research Analyst
(SanjayJain@MotilalOswal.com); +91 22 6129 1523
Dhruv Muchhal – Research Analyst
(Dhruv.Muchhal@MotilalOswal.com); +91 22 6129 1549

Tata Steel
BSL should be delisted or merged with TATA, in our view
We do not understand the logic of allowing trading in BSL, as the equity value
had evaporated the moment it moved into NCLT. This has allowed smart
investors to exit at the cost of gullible speculative investors. We do not
understand how investors are buying BSL without knowing the size of the
balance sheet and share capital. TATA should negotiate hard with lenders to
merge BSL and BPS with itself post acquisition, in our view. We believe keeping
BSL listed will create related party conflict and will not benefit anyone. Lenders
and minority may swap shares with TATA at fair value.
It remains to be seen how market will value underlying growth options
Going by the history of the Indian steel sector, most producers have gone into
deep financial stress or debt trap whenever they set up new Greenfield projects.
Project delays, high interest cost and cyclical nature of the steel industry are the
key reasons behind it. JSW Steel, Essar Steel, Ispat Industries, SAIL and
numerous SMEs have all fallen in debt trap at least once. Despite strong free
cash flows from Jamshedpur, TATA too faced multiple delays, escalation of
project cost and a drag on its balance sheet for its Kalinganagar project in
Odisha (KPO). Thereafter, these sites have been able to create shareholder value
because incremental specific capex is lower. Just when TATA was about to get
its troubles sorted with hiving-off of its European business and stabilization of
KPO, it has got near-term drag of two expensive acquisitions. One may argue for
a higher valuation multiple. However, it remains to be seen how the equity
market will value these growth options at the three sites in Odisha.
Strategic acquisitions are near-term drag; Maintain Neutral
TATA has pursued growth opportunities aggressively over the last 10-15 years.
These may have long-term strategic benefits (although many were disaster), but
have almost always eroded the stock performance in immediate future.
Investors are unable to attach value to long-term growth options because of the
cyclical nature of the industry.
Steel market remains strong on moderate growth in demand, driven by growth
in industrial production across the world and supply-side discipline in China. If
steel prices sustain, there may be some upside to our estimates. The stock is
trading at EV/EBTIDA of 7x FY20E and P/E of 10.4x FY20E.
If we were to factor in the above-mentioned acquisitions, the stock would be
trading at EV/EBITDA of 7.4xFY20E and P/E of 10.6xFY20E, and the SOTP would
be lower by 13% at INR677. Maintain
Neutral.
21 February 2018
2

Tata Steel
Exhibit 1: SOTP valuation
2016
India
EBITDA per ton (USD)
EBITDA per ton (INR)
Sales (m tons)
EBITDA-India
Target EBITDA multiple
EV (India) - (a)
INR/share
Subsidiaries
EBITDA per ton (USD)
Sales (m tons)
EBITDA
Target EBITDA multiple
EV (TSE) - (b)
INR/share
33% equity in TSE UK ( c )
Target EV (c=a+b-c)
Net Debt (d)
INR/share
CWIP (e)
TS-TK JV (f)
TP (c-d+e+f)
Target Price (INR /share)
115
7,557
9.5
73,271
2017
161
10,818
11.0
118,760
2018E
196
12,702
12.5
158,360
6.5
1,029,340
1,060
67
13.2
56,789
6.5
369,131
380
19,793
1,378,677
611,068
629
67,797
2019E
205
13,320
12.8
170,287
6.5
1,106,863
1,139
68
13.1
57,606
6.5
374,441
385
29,512
1,451,792
559,331
576
78,531
2020E
185
12,036
12.9
155,414
6.5
1,010,191
1,040
3
16.4
3,832
56
13.0
49,005
8,976
6.5
58,346
60
1,068,537
383,283
395
160,829
90,025
936,109
778
769,329
354,879
744,767
157,841
Source: MOSL, Company
21 February 2018
3

Tata Steel
Financials and Valuations
Income Statement
Y/E Mar
Net Sales
Change (%)
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
Other Income
Extraordinary items
PBT
Tax
Tax Rate (%)
Min. Int. & Assoc. Share
Reported PAT
Adjusted PAT
Change (%)
2013
1,347,115
1.4
123,212
9.1
55,753
67,459
39,681
4,792
-73,899
-41,330
32,294
-78.1
-2,145
-72,375
1,524
-91.6
2014
1,486,136
10.3
164,110
11.0
58,412
105,698
43,368
5,168
-276
67,221
30,582
45.5
-80
34,203
34,479
2,162.2
2015
1,395,037
-6.1
127,758
9.2
59,436
68,322
48,478
7,962
-43,980
-16,175
23,380
-144.5
-450
-41,204
2,776
-91.9
2016
1,171,516
-16.0
75,857
6.5
50,818
25,038
41,286
39,257
-39,749
-16,740
15,050
-89.9
-1,089
-32,292
7,457
168.6
2017
1,122,994
-4.1
170,078
15.1
56,729
113,349
50,722
5,275
-81,884
-13,982
27,780
-198.7
687
-45,034
36,851
394.2
2018E
1,286,200
14.5
215,149
16.7
59,608
155,541
53,903
8,277
-17,672
92,244
40,306
43.7
-1,229
51,726
69,398
88.3
2019E
1,278,673
-0.6
228,182
17.8
61,716
166,466
(INR Million)
2020E
690,528
-46.0
164,390
23.8
44,610
119,780
54,327
11,124
0
123,263
37,260
30.2
60
83,535
83,535
20.4
34,457
12,513
0
97,837
33,157
33.9
-123
73,958
73,958
-11.5
Balance Sheet
Y/E Mar
Share Capital
Reserves
Net Worth
Minority Interest
Debt
Deferred Tax
Total Capital Employed
Gross Fixed Assets
Less: Acc Depreciation
Net Fixed Assets
Goodwill on consolidation
Capital WIP
Investments
Current Assets
Inventory
Debtors
Cash & Bank
Loans & Adv, Others
Curr Liabs & Provns
Net Current Assets
Total Assets
2013
9,714
332,008
341,722
16,694
702,707
31,185
1,092,308
1,352,650
798,379
554,271
130,650
137,862
24,974
620,943
240,912
139,940
106,200
133,892
376,391
244,552
1,092,308
2014
9,714
395,606
405,320
17,377
837,805
25,550
1,286,052
1,570,087
969,844
600,242
157,488
259,564
24,251
674,492
268,800
160,058
112,729
132,906
429,985
244,508
1,286,052
2015
9,714
303,780
313,494
17,039
828,887
28,618
1,188,037
1,512,105
965,176
546,928
134,075
286,781
20,804
600,639
251,499
133,099
101,246
114,796
401,191
199,448
1,188,037
2016
9,702
275,086
284,789
16,542
883,646
28,830
1,213,807
1,590,548
1,121,252
469,296
137,194
354,879
20,845
650,068
203,560
117,012
114,317
215,180
418,475
231,594
1,213,807
2017
9,702
345,741
355,443
16,017
850,709
91,091
1,313,260
1,265,617
380,498
885,118
34,947
157,841
67,840
578,376
248,038
115,868
105,942
108,528
410,863
167,513
1,313,260
2018E
12,031
500,641
512,672
14,788
844,383
108,760
1,480,603
1,366,971
440,106
926,864
34,947
122,797
67,840
757,655
281,907
133,906
233,314
108,528
429,501
328,154
1,480,603
(INR Million)
2019E
12,031
572,406
584,437
14,847
852,145
116,216
1,567,645
1,446,733
501,822
944,910
34,947
133,531
67,840
814,721
280,257
133,122
292,814
108,528
428,305
386,417
1,567,645
2020E
12,031
599,896
611,927
14,724
660,999
123,575
1,411,226
1,180,745
389,915
790,830
0
160,829
205,449
525,128
134,104
46,882
277,716
66,426
271,010
254,118
1,411,226
21 February 2018
4

Tata Steel
Financials and Valuations
Ratios
Y/E Mar
Basic (INR)
EPS
Cash EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Profitability Ratios (%)
RoE
RoCE
RoIC
Turnover Ratios (%)
Asset Turnover (x)
Debtors (No. of Days)
Inventory (No. of Days)
Creditors (No. of Days)
Leverage Ratios (%)
Net Debt/Equity (x)
2.8
2.9
4.1
5.2
2.3
1.3
1.0
0.6
1.2
38
65
54
1.2
39
66
56
1.2
35
66
50
1.0
36
63
64
0.9
38
81
60
0.9
38
80
58
0.8
38
80
58
0.5
25
71
60
0.7
6.7
8.5
15.0
9.3
12.3
1.3
6.1
8.2
4.6
5.4
3.3
15.7
9.4
13.3
15.9
11.8
15.3
16.3
11.7
15.6
12.7
9.7
13.0
407.3
-34.7
2.9
0.9
9.9
1.3
18.0
6.5
2.5
0.9
8.2
1.3
223.6
31.2
3.5
1.0
10.6
1.3
83.1
32.6
4.2
1.2
18.3
1.3
16.8
41.4
1.9
1.2
8.0
1.3
11.1
6.9
1.6
1.1
6.4
1.3
9.2
5.2
1.4
1.0
5.8
1.3
10.4
7.0
1.3
1.7
7.0
1.3
1.6
-18.4
217.3
8.0
886.5
35.5
97.8
255.1
8.0
39.2
2.9
20.5
184.7
8.0
407.4
7.7
19.6
152.1
8.0
124.2
38.0
15.4
330.3
8.0
25.1
57.7
92.7
397.1
8.0
13.3
69.4
122.8
456.7
8.0
11.1
61.5
90.8
508.6
8.0
12.5
2013
2014
2015
2016
2017
2018E
2019E
2020E
Cash Flow Statement
Y/E Mar
Adjusted EBITDA
Non cash opr. exp (inc)
(Inc)/Dec in Wkg. Cap.
Tax Paid
Other operating activities
CF from Op. Activity
(Inc)/Dec in FA & CWIP
Free cash flows
(Pur)/Sale of Invt
Others
CF from Inv. Activity
Inc/(Dec) in Net Worth
Inc / (Dec) in Debt
Interest Paid
Divd Paid (incl Tax) & Others
CF from Fin. Activity
Inc/(Dec) in Cash
Add: Opening Balance
Closing Balance
2013
123,212
4,424
31,293
-25,690
0
133,239
-154,715
-21,476
20,569
5,582
-128,564
2,646
25,153
-34,657
-13,590
-20,448
-15,772
121,972
106,200
2014
164,110
10,172
-12,696
-30,127
0
131,459
-164,201
-32,742
14,356
14,770
-135,075
156
58,658
-39,424
-9,244
10,146
6,529
106,200
112,729
2015
127,758
11,797
3,514
-24,270
0
118,798
-134,924
-16,126
28,339
2,476
-104,109
167
42,119
-56,938
-11,520
-26,172
-11,483
112,729
101,246
2016
75,857
5,894
54,332
-16,450
0
119,632
-114,859
4,773
39,798
7,784
-67,277
550
15,329
-45,669
-9,494
-39,284
13,071
101,246
114,317
2017
170,078
5,736
-48,907
-18,427
0
108,481
-77,156
31,324
3,552
-11,509
-85,113
6,519
27,041
-49,986
-9,498
-25,924
-2,557
108,499
105,942
2018E
215,149
0
-33,268
-22,636
0
159,245
-72,636
86,608
0
-18,062
-90,698
126,907
0
-56,560
-11,521
58,826
127,373
105,942
233,314
2019E
228,182
0
1,237
-29,805
0
199,615
-82,734
116,882
0
11,124
-71,610
0
0
-56,984
-11,521
-68,505
59,500
233,314
292,814
(INR Million)
2020E
164,390
-3,078
-37,569
-25,798
0
97,946
-80,000
17,946
0
10,677
-69,323
0
0
-34,457
-9,265
-43,721
-15,098
292,814
277,716
21 February 2018
5

Explanation of Investment Rating
Investment Rating
BUY
SELL
NEUTRAL
UNDER REVIEW
NOT RATED
Expected return (over 12-month)
>=15%
< - 10%
> - 10 % to 15%
Rating may undergo a change
We have forward looking estimates for the stock but we refrain from assigning recommendation
Tata Steel
*In case the recommendation given by the Research Analyst becomes inconsistent with the investment rating legend, the Research Analyst shall within 28 days of the inconsistency, take appropriate measures to make the recommendation consistent with the investment rating legend.
NOTES
Disclosures:
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Motilal Oswal Securities Ltd. (MOSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOSL, the Research Entity (RE) as defined in the Regulations, is engaged in the business of providing Stock broking services,
Investment Advisory Services, Depository participant services & distribution of various financial products. MOSL is a subsidiary company of Motilal Oswal Financial Service Ltd. (MOFSL). MOFSL is a listed public company, the details in respect of
which are available on
www.motilaloswal.com.
MOSL is registered with the Securities & Exchange Board of India (SEBI) and is a registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited
(BSE), Metropolitan Stock Exchange Of India Ltd. (MSE) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) & National Securities Depository Limited (NSDL) and is member of Association of
Mutual Funds of India (AMFI) for distribution of financial products. Details of associate entities of Motilal Oswal Securities Limited are available on the website at
http://onlinereports.motilaloswal.com/Dormant/documents/Associate%20Details.pdf
Regulatory Enquiries against Motilal Oswal Securities Limited by SEBI:
SEBI pursuant to a complaint from client Shri C.R. Mohanraj alleging unauthorized trading, issued a letter dated 29th April 2014 to MOSL notifying appointment of an Adjudicating Officer as per SEBI regulations to hold inquiry and
adjudge violation of SEBI Regulations; MOSL requested SEBI to provide all documents, records, investigation report relied upon by SEBI which were referred in Show Cause Notice. The matter is closed and MOSL had to pay Rs. 2
lakhs towards penalty for misplacement of original POA of client.
MOSL, it’s associates, Research Analyst or their relative may have any financial interest in the subject company. MOSL and/or its associates and/or Research Analyst may have beneficial ownership of 1% or more securities in the subject company at
the end of the month immediately preceding the date of publication of the Research Report.
MOSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act
as principal in, and buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial
instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other related information and opinions.;
however the same shall have no bearing whatsoever on the specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOSL even though there
might exist an inherent conflict of interest in some of the stocks mentioned in the research report.
Research Analyst may have served as director/officer, etc. in the subject company in the last 12 month period. MOSL and/or its associates may have
received any compensation from the subject company in the past 12 months.
In the last 12 months period ending on the last day of the month immediately preceding the date of publication of this research report, MOSL or any of its associates may have:
a)
managed or co-managed public offering of securities from subject company of this research report,
b)
received compensation for investment banking or merchant banking or brokerage services from subject company of this research report,
c)
received compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company of this research report.
d)
Subject Company may have been a client of MOSL or its associates during twelve months preceding the date of distribution of the research report.
MOSL and it’s associates have not received any compensation or other benefits from the subject company or third party in connection with the research report. To enhance transparency, MOSL has incorporated a Disclosure of Interest Statement in
this document. This should, however, not be treated as endorsement of the views expressed in the report. MOSL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result,
the recipients of this report should be aware that MOSL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific merchant banking, investment banking or
brokerage service transactions.
Terms & Conditions:
This report has been prepared by MOSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be altered in any way, transmitted to, copied or distributed, in part
or in whole, to any other person or to the media or reproduced in any form, without prior written consent of MOSL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report
is not recommendatory in nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty, representation of warranty, express or implied,
is made as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice. The report is prepared solely for informational purpose and does not constitute an offer document or solicitation of offer to
buy or sell or subscribe for securities or other financial instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MOSL will not treat recipients as customers by
virtue of their receiving this report.
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to the
specific recommendations and views expressed by research analyst(s) in this report.
Disclosure of Interest Statement
Analyst ownership of the stock
Tata Steel
No
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental research and Technical Research. Proprietary trading desk of MOSL or
its associates maintains arm’s length distance with Research Team as all the activities are segregated from MOSL research activity and therefore it can have an independent view with regards to subject company for which Research Team have
expressed their views.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject
MOSL & its group companies to registration or licensing requirements within such jurisdictions.
For Hong Kong:
This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong Kong Securities and Futures Commission (SFC) pursuant to the Securities
and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH000000412) has an agreement with Motilal Oswal capital Markets (Hong Kong)
Private Limited for distribution of research report in Hong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity to which this document relates is only
available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these securities, products and services in any jurisdiction where their offer or sale is not qualified or exempt from
registration. The Indian Analyst(s) who compile this report is/are not located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For U.S.
Motilal Oswal Securities Limited (MOSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state laws in the United States. In addition MOSL is not a registered
investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption
under the Acts, any brokerage and investment services provided by MOSL, including the products and services described herein are not available to or intended for U.S. persons. This report is intended for distribution only to "Major Institutional
Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional investors"). This document must not be acted on or relied on by persons who are not major institutional
investors. Any investment or investment activity to which this document relates is only available to major institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration provided by Rule
15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S.,
MOSL has entered into a chaperoning agreement with a U.S. registered broker-dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of
this chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer, MOSIPL, and therefore, may not be subject
to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research analyst account.
For Singapore
Motilal Oswal Capital Markets Singapore Pte Limited is acting as an exempt financial advisor under section 23(1)(f) of the Financial Advisers Act(FAA) read with regulation 17(1)(d) of the Financial Advisors Regulations and is a subsidiary of Motilal
Oswal Securities Limited in India. This research is distributed in Singapore by Motilal Oswal Capital Markets Singapore Pte Limited and it is only directed in Singapore to accredited investors, as defined in the Financial Advisers Regulations and the
Securities and Futures Act (Chapter 289), as amended from time to time. In respect of any matter arising from or in connection with the research you could contact the following representatives of Motilal Oswal Capital Markets Singapore Pte Limited:
Disclaimer:
The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced
in any form, without prior written consent. This report and information herein is solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial
instruments. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The securities discussed and opinions expressed in
this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of
independent judgment by any recipient. Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document
(including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. Certain transactions -including
those involving futures, options, another derivative products as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy,
completeness or fairness of the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and should not be treated as endorsement of the
views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make modifications and alternations to this statement as may be required from time to time without any prior approval.
MOSL, its associates, their directors and the employees may from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to perform
investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a separate, distinct and independent of each other. The recipient should take this
into account before interpreting the document. This report has been prepared on the basis of information that is already available in publicly accessible media or developed through analysis of MOSL. The views expressed are those of the analyst, and
the Company may or may not subscribe to all the views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or
published, copied, in whole or in part, for any purpose. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such
distribution, publication, availability or use would be contrary to law, regulation or which would subject MOSL to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all
jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or representatives shall
be liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of the information.
The person accessing this information specifically agrees
to exempt MOSL or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSL or any of its affiliates or employees responsible for any such misuse and further agrees to hold MOSL
or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022-3980 4263; www.motilaloswal.com. Correspondence Address: Palm Spring Centre, 2nd Floor, Palm
Court Complex, New Link Road, Malad (West), Mumbai- 400 064. Tel No: 022 3080 1000. Compliance Officer: Neeraj Agarwal, Email Id:
na@motilaloswal.com,
Contact No.:022-30801085.
Registration details of group entities.: MOSL: SEBI Registration: INZ000158836 (BSE/NSE/MSE); CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser: INA000007100.
Motilal Oswal Asset Management Company Ltd. (MOAMC): PMS (Registration No.: INP000000670) offers PMS and Mutual Funds products. Motilal Oswal Wealth Management Ltd. (MOWML): PMS (Registration No.: INP000004409) offers wealth
management solutions. *Motilal Oswal Securities Ltd. is a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs, Insurance and IPO products. * Motilal Oswal Commodities Broker Pvt. Ltd. offers Commodities Products. * Motilal Oswal Real
Estate Investment Advisors II Pvt. Ltd. offers Real Estate products. * Motilal Oswal Private Equity Investment Advisors Pvt. Ltd. offers Private Equity products
21 February 2018
6