14 May 2018
Market snapshot
Equities - India
Close
Chg .%
Sensex
35,536
0.8
Nifty-50
10,807
0.8
Nifty-M 100
19,507
0.4
Equities-Global
Close
Chg .%
S&P 500
2,728
0.2
Nasdaq
7,403
0.0
FTSE 100
7,725
0.3
DAX
13,001
-0.2
Hang Seng
12,345
0.9
Nikkei 225
22,758
1.2
Commodities
Close
Chg .%
Brent (US$/Bbl)
77
-0.7
Gold ($/OZ)
1,318
-0.2
Cu (US$/MT)
6,909
0.4
Almn (US$/MT)
2,278
-2.2
Currency
Close
Chg .%
USD/INR
67.3
0.0
USD/EUR
1.2
0.2
USD/JPY
109.4
0.0
YIELD (%)
Close
1MChg
10 Yrs G-Sec
7.7
0.01
10 Yrs AAA Corp
8.4
0.02
Flows (USD b)
11-May
MTD
FIIs
0.0
-1.0
DIIs
0.2
1.5
Volumes (INRb)
11-May
MTD*
Cash
319
341
F&O
3,871
6,666
Note: YTD is calendar year, *Avg
YTD.%
4.3
2.6
-7.7
YTD.%
2.0
7.2
0.5
0.6
5.4
0.0
YTD.%
14.5
1.2
-4.1
1.0
YTD.%
5.4
-0.5
-2.9
YTDchg
0.4
0.5
YTD
1.2
5.1
YTD*
373
7,915
Today’s top research idea
Havells India: Operating performance ahead of expectations
Healthy overall performance for the quarter:
Revenue grew 48% YoY to
INR25.3b (est. of INR24.8b) in 4QFY18 supported by strong performance of the
core business (+18% YoY, adj. for excise impact on exempted zones) and
equally robust performance from newly acquired Lloyd electrical business
(INR5.8b for 4QFY18). Operating profit of INR3.6b (+55.8% YoY) was ahead of
our estimate of INR3.1b, led by above-estimated performance in Lighting
(contribution margin of 31% vs 28% in 4QFY17) and Lloyd Electrical
(contribution margin of 22% in 4QFY18). Adj. PAT of INR2.3b (+37% YoY) was
above our estimate of INR2.1b. For FY18, revenue stood at INR81.4b (+33%
YoY), operating profit at INR10.5b (+27% YoY) and PAT at INR7.0b (+17% YoY).
We like HAVL given (a) successful development of brand, distribution and
product portfolio, (b) demonstrated track record of accelerating growth
through new launches, (c) healthy dividend payout and (d) robust return ratios
and maintain our
Buy
rating and TP to INR630 with exit multiple of 37x Mar’20E
EPS of INR17.1.
Research covered
Cos/Sector
EcoScope
JLR (Automobile)
Sun TV Network
Havells India
P & G Hygiene
GlaxoSmith C H L
Canara Bank
Mphasis
Other Results
Key Highlights
IIP growth slows down in March
JLR’s April 2018 wholesales in-line at 45.3k units
Stellar performance; Upbeat outlook
Operating performance ahead of expectations
Sales growth disappoints again; higher adspend encouraging
Operating performance in-line; PAT beat led by higher other income
Elevated provisions lead to losses; asset quality stress persists
Outperformance through Front2Back transformation
TCOM | GUJGA | RINDL | SOIL | LAURUS
Results Expectation BLSTR | HUVR
Chart of the Day: Havells India – Operating performance ahead of expectations
Revenues improved 48% YoY, in line with estimates
EBIDTA margin improvement driven by core business as
well as Lloyd business
Research Team (Gautam.Duggad@MotilalOswal.com)
Source: Company, MOSL
Source: Company, MOSL
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Investors are advised to refer through important disclosures made at the last page of the Research Report.

In the news today
Kindly click on textbox for the detailed news link
1
India’s IIP growth falls to five-
month low of 4.4% in March
The recovery in India’s industrial
production faltered in March after
manufacturing registering robust
growth for four consecutive
months, official data showed on
Friday, casting doubts on the
strength of upturn in the Indian
economy…
2
Fortis saga not over yet as shareholders plan counter move
Hedge fund East Bridge Capital and Jupiter India Funds’ move to replace
four Fortis Healthcare Ltd directors has drawn support from large
shareholders, three people directly aware of the development said. The
disgruntled investors, including funds representing close to 30% of Fortis’s
shareholding, are expected to support East Bridge in the special meeting
on 22 May to decide the fate of directors Brian Tempest, Harpal Singh,
Sabina Vaisoha and Tejinder Singh Shergill, the people said, requesting
anonymity…
3
After Dena Bank, RBI may put
restrictions on 2 more lenders
under PCA
After Dena Bank, the Reserve Bank
now is likely to impose certain
restrictions on couple of more
public sector lenders under the
Prompt Corrective Action (PCA)
mechanism due to worsening
asset quality, a source said…
4
Bank loans to jewellers grow
surprisingly after PNB-Nirav
Modi scam
The flow of bank loans to the
gems and jewellery sector saw a
surprising 5.7% rise between mid-
January and March, which perhaps
suggests that jewellers availed
their existing credit limits
immediately after the fraud came
to light, before banks sprung into
action to tighten the purse
strings...
5
Maruti Suzuki gets lion’s
share of Suzuki R&D budget
Most of the $1.5 billion allocated
by Suzuki Motor Corp. for its
research and development (R&D)
activities will be spent on its
most profitable unit Maruti
Suzuki and help the Indian firm
maintain its 50% market share
amid increasing competition
from European and Korean
manufacturers…
6
SoftBank in talks to invest big
money in Paytm Mall
SoftBank has held early
discussions to invest more in
Paytm Mall even as it makes up
its mind about selling its
significant minority stake in rival
Flipkart to Walmart, said two
people familiar with the
development…
7
Reliance Jio Files Complaint
Against Airtel Over Apple
Watch Service; Airtel Refutes
Charge
Reliance Jio Infocomm Ltd. has
alleged that Bharti Airtel Ltd. is
offering eSim service on Apple
Watch in violation of licence
norms, prompting the Sunil
Mittal-led telecom major call it a
“frivolous complaint”…
14 May 2018
2

E
CO
S
COPE
IIP growth slows down in March
Broad-based deceleration in manufacturing sector pulls down growth
11 May 2018
The Economy Observer
The Index of Industrial Production (IIP) growth slowed down to 4.4% in March 2018 from 7%+ in the previous three
months, as the favourable base effect dissipated in the month. The number was below our estimate/market consensus
of a 5.6%/6.2% rise.
Lower IIP growth can be primarily attributed to the manufacturing sector, where growth slowed down to 4.4% in March
2018 from an average of 9.1% in the previous three months. The deceleration was broad-based, with ~51% of the sector
(v/s 28% in February 2018) reporting growth of less than 5%. 12 of the 23 industries within manufacturing witnessed a
contraction in output.
As per use-based classification, output of capital goods declined by 1.8% YoY in March after growing in double-digits
over the previous three months. Growth in the output of consumer durables was also weak at 2.9%.
IIP growth decelerated to 4.4% in FY18 from 4.6% in the previous year. We expect growth to come in at ~5.5% in
1HFY19, slightly lower than +6% in 2HFY18. For full-year FY19, we expect growth to improve slightly to 4.6%.
IIP growth slows down to 4.4% in March 2018…:
The Index of Industrial
Production (IIP) rose by just 4.4% in March 2018
(Exhibit 1).
The number is
below our estimate/market consensus of a 5.6%/6.2% rise. Growth slowed
down from 7%+ in the previous three months, as the favourable base effect that
was seen over December 2017-February 2018 dissipated in March.
Broad-based decline in manufacturing pulls down IIP:
Growth in the
manufacturing output dropped to 4.4% from an average of 9.1% in the previous
four months. The deceleration was broad-based, with ~51% of the sector (by
weight) reporting growth of less than 5% in March 2018, up from ~28% in the
preceding month
(Exhibit 3).
As many as 12 of the 23 industries within
manufacturing witnessed a YoY contraction in output in the month. Among the
manufacturing industries, the output of tobacco products, wearing apparels and
electrical equipment fell by over 5% YoY in March 2018. Mining and power
generation rose by 2.8% and 5.9%, respectively, in the month.
Capital goods and consumer durables drag growth:
As per use-based
classification, capital goods production declined by 1.8% YoY in March 2018,
after growing in double-digits over the previous three months. Growth in the
previous three months was largely led by a weak base (December 2016-
February 2017: -3.1%). However, this effect dissipated thereafter (March 2017:
+9.4%), leading to a sharp fall in capital goods production in March 2018.
Growth in the output of consumer durables slowed down to 2.9% in March 2018
from 7.5%+ in the previous two months. Growth in the output of
infra/construction goods and consumer non-durables remained healthy at 8.8%
and 10.9%, respectively, in March 2018.
IIP growth to improve slightly in FY19:
IIP growth decelerated to 4.4% in FY18
from 4.6% in FY17 due to slower growth in mining and electricity generation.
We expect growth to come in at ~5.5% in 1HFY19, slightly lower than +6% in
2HFY18. For full-year FY19, we expect growth to improve slightly to 4.6%.
14 May 2018
3

Tata Motors
BSE SENSEX
35,536
S&P CNX
10,807
11 May 2018
Update
| Sector:
Automobiles
CMP: INR331
TP: INR565 (+71%)
Buy
JLR’s April 2018 wholesales in-line at 45.3k units
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
Avg Val, INRm
Free float (%)
Land Rover volumes up 3.7% YoY; Jaguar volumes grow 18% YoY
TTMT IN
3,395.9
487 / 325
-11/-28/-40
1123.4
16.7
3644.0
63.6
Financials Snapshot (INR b)
Y/E March
2018E 2019E
Net Sales
2,910
3,335
EBITDA
361.1
523.8
NP
84.2
193.6
Adj. EPS (INR) 24.8
57.0
EPS Gr. (%)
25.2
129.8
BV/Sh. (INR) 205.8
264.0
RoE (%)
13.2
24.3
RoCE (%)
7.5
12.8
P/E (x)
13.3
5.8
P/BV (x)
1.6
1.3
2020E
3,665
587.9
223.2
65.7
15.3
331.0
22.1
12.6
5.0
1.0
Shareholding pattern (%)
Mar-18 Dec-17 Mar-17
As On
Promoter
36.4
36.4
34.7
DII
17.7
17.1
15.5
FII
20.3
21.4
23.2
Others
25.7
25.1
26.6
FII Includes depository receipts
Stock Performance (1-year)
Tata Motors
Sensex - Rebased
540
480
420
360
300
JLR’s wholesale volumes grew 8% YoY (declined 40.6% MoM) to 45.3k units
(including China JV’s 7.7k units) in April 2018.
Jaguar volumes grew 18% YoY to 14.9k units, beating our estimate of 13k units.
Land Rover volumes were 30.4k units, lower than our estimate of 32k units.
JLR’s retail volumes grew 11.9% YoY (declined 46% MoM) to 45.2k units, as
Jaguar retails grew 8% YoY (declined 45.3% MoM) to 13.3k units while LR
retails increased 13.6% YoY (declined 46.3% MoM) to 31.2k units.
The growth in Jaguar volumes was led by E-pace (3.1k units). Volumes of other
models like XF, F-Pace, XE declined YoY by 1.9%, 23.4% and 7%, respectively.
LR’s retail volumes increased 13.6% YoY to 31.9k, led by Discovery (+66.7%
YoY), RR Sport (+4% YoY) and Velar (4.8k units).
Region-wise, China volumes grew 28.9% YoY to 12.9k units. The growth in
China is reflecting the introduction of the long wheelbase Jaguar XFL and XEL.
Retails in the UK and US markets grew YoY by 25.9% and 2.5%, respectively.
Retails in Europe markets declined 10.2%.
Mr Felix Brautigam, Jaguar Land Rover Chief Commercial Officer said, “Retail
sales in April reflect strong interest in our new models. Jaguar sales have
been further boosted by the introduction of the exciting E-PACE compact
SUV. There is also high demand for the new Jaguar I-PACE, the first all-electric
performance SUV.”
He also said,
“It's pleasing to see a marked improvement in the UK. This is
mainly due to two all-new models now being on the market but also an
artificially low April 2017 caused by taxation changes. The legislative
uncertainty around diesel and the resulting lower demand in the UK and
Europe continue to have a negative impact on our business.”
The stock trades at 5.8/5x FY19E/20E consolidated EPS. Maintain
Buy
with a
target price of INR565 (March 2020E SOTP-based).
14 May 2018
4

11 May 2018
4QFY18 Results Update | Sector: Media
Sun TV
Buy
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
S&P CNX
10,807
SUNTV IN
Stellar performance; Upbeat outlook
394
Strong revenue drives EBITDA:
Standalone revenue grew 23% YoY to
383.2 / 6.0
INR7.2b (3% beat), driven by strong 26% ad revenue growth and 28%
1097 / 652
domestic subscription revenue growth. EBITDA surged 33% YoY to INR5.2b,
-7/-8/-22
with the margin expanding 530bp YoY to 72.9%. However, a steep rise in
1263.0
25.0
depreciation expense restricted PAT to INR2.9b (+23% YoY). Cable/DTH
CMP: INR865
TP: INR1,200(+26%)
Financials & Valuations (INR b)
2018 2019E
Y/E Mar
Net Sales
28.6
33.8
EBITDA
19.6
23.6
PAT
10.9
13.8
EPS (INR)
27.7
35.0
Gr. (%)
11.6
26.2
BV/Sh (INR)
117.7
128.5
RoE (%)
25.2
28.4
RoCE (%)
25.3
28.5
P/E (x)
31.2
24.7
P/BV (x)
7.3
6.7
EV/EBITDA (x)
16.4
13.4
2020E
38.3
26.7
16.0
40.6
15.9
141.4
30.1
30.1
21.3
6.1
11.6
Estimate change
TP change
Rating change
revenue surged 49%/20% YoY to INR1b/INR2.1b, mainly led by higher ARPU
(from digitization of the TN market). For FY18, standalone revenue/EBITDA
grew 12%/13% YoY to INR28.6b/19.6b (1% beat), while PAT rose 12% to
INR10.9b (in-line).
Concall highlights: (1)
Management indicated that incremental subscription
revenue from digitization in Tamil Nadu would surpass INR3b. Expect
domestic subscription revenue to grow at 20-25% in FY19.
(2)
EBITDA margin
should improve in FY19, driven by a) IPL biz turning profitable and b)
increasing mix of subscription revenue.
(3)
Expects to foray into one new
regional market in FY19.
Multiple levers for growth:
We expect domestic subscription revenue CAGR
of 17% over FY18-20, primarily led by higher ARPU, which is largely due to
digitization of ~10m analog subscribers (~50% of the TN market). Ad revenue
should witness strong momentum, led by a healthy ad outlook, a steady
shift to the commission model in the TN market and a consistent healthy
viewership share. Subsequently, we expect 12% ad revenue CAGR over
FY18-20. IPL business turning profitable in FY19E is further expected to
bolster earnings growth. We largely maintain our estimates – 16% revenue
CAGR and 17%/21% EBITDA/PAT CAGR over FY18-20.
Valuation view:
SUNTV is trading at 24.7x/21.3x FY19/20E EPS, and is valued
at ~30-35% discount to ZEE. We believe PAT CAGR of 21% over FY18-20,
coupled with a steady increase in RoCE to 30%, should help reduce the
valuation gap. We value the stock at 30x (~15% discount to ZEE) FY20E EPS
of INR41, arriving at a revised TP of INR1,200 (prior: INR1,225). Maintain
Buy.
FY17
FY18
4Q
5,825
3.1
1,889
3,936
67.6
767
2
374
3,541
1,182
33.4
2,359
2,359
5.4
40.5
1Q
7,863
3.4
3,380
4,484
57.0
1,035
1
371
3,819
1,302
34.1
2,516
2,516
8.0
32.0
2Q
6,759
8.1
1,798
4,961
73.4
1,027
1
372
4,306
1,459
33.9
2,847
2,847
5.3
42.1
3Q
6,833
15.9
1,912
4,920
72.0
1,145
1
291
4,066
1,397
34.3
2,670
2,670
11.2
39.1
4Q
7,170
23.1
1,946
5,224
72.9
1,190
9
368
4,393
1,496
34.0
2,898
2,898
22.8
40.4
FY17
25,583
6.8
8,221
17,361
67.9
3,911
13
1,466
14,904
5,109
34.3
9,794
9,794
14.2
38.3
FY18
28,625
11.9
9,036
19,589
68.4
4,397
11
1,402
16,584
5,654
34.1
10,930
10,930
11.6
38.2
(INR Million)
4Q
Est Var
FY18E
(%)
6,947
3
19.3
1,938
0
5,009
4
72.1
76.6
957
24
3
155
360
2
4,408
0
1,511
34.3
2,898
0
2,898
0
22.8
41.7 -129.6
Standalone - Quarterly
Earning
Model
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
1Q
7,608
10.4
3,244
4,364
57.4
1,008
1
216
3,571
1,240
34.7
2,331
2,331
19.0
30.6
2Q
6,255
10.2
1,592
4,663
74.6
1,030
2
488
4,119
1,415
34.4
2,704
2,704
21.7
43.2
3Q
5,894
2.8
1,497
4,397
74.6
1,107
7
389
3,673
1,272
34.6
2,401
2,401
11.0
40.7
14 May 2018
5

11 May 2018
4QFY18 Results Update | Sector: Capital Goods
Havells India
Buy
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
S&P CNX
10,807
HAVL IN
Operating performance ahead of expectations
625
Op. performance exceeds expectations:
Revenue grew 48% YoY to INR25.3b
341.9 / 5.3
(est. of INR24.8b) in 4QFY18. Operating profit of INR3.6b (+55.8% YoY) was
593 / 434
ahead of our estimate of INR3.1b, led by above-estimated performance in
-3/2/-11
Lighting and Lloyd Electrical. Adj. PAT of INR2.3b (+37% YoY) was above our
744.0
estimate of INR2.1b. For FY18, revenue was at INR81.4b (+33% YoY),
40.4
CMP: INR547
TP: INR630 (+15%)
Financials & Valuations (INR b)
Y/E Mar
Net Sales
EBITDA
Adj PAT
Adj EPS (INR)
EPS Gr. (%)
BV/Sh(INR)
RoE (%)
RoCE (%)
P/E (x)
P/BV (x)
2018 2019E 2020E
81.4
98.3
112.6
10.5
13.4
16.0
7.0
8.7
10.5
11.2
14.0
16.8
17.4
24.4
20.3
59.9
68.0
77.8
18.7
20.5
21.6
18.8
20.6
22.0
48.7
39.2
32.6
9.1
8.0
7.0
Estimate change
TP change
Rating change
Quarterly Performance (Standalone)
Y/E March
Sales
Change (%)
Adj EBITDA
Change (%)
Adj EBITDA margin (%)
Depreciation
Interest
Other Income
Extra-ordinary Items
PBT
Tax
Effective Tax Rate (%)
Reported PAT
Change (%)
Adj PAT
Change (%)
1Q
14,668
17.1
2,004
23.7
13.7
280
16
314
-
2,022
567
28.0
1,456
36.3
1,456
22.2
operating profit at INR10.5b (+27% YoY) and PAT at INR7.00b (+17% YoY).
Robust growth in core business (ex-Lloyd):
Core business revenue grew 14%
YoY to INR19.5b (+18% YoY, adj. for excise impact on exempted zones; est.
of INR19.1b), led by growth across segments. Operating profit rose 24% YoY
to INR2.9b and EBIDTA margin improved 120bp YoY to 14.6%, driven by
margin improvement across product categories.
Strong performance at Lloyd’s consumer business:
The recently acquired
Lloyd business recorded revenue of INR5.8b, operating profit of INR724m
and EBIDTA margin of 12.4%. Margin improvement was driven by higher
volumes, better pricing and cost-rationalization measures.
Working capital cycle contraction led by higher payable days:
Core net
working capital cycle contracted to -35 days from 5 days in FY17. In FY18,
creditor days were up to 123 from 63 in FY17 due to vendor financing and
extended credit cycle provided by Lloyd’s vendors.
Key concall highlights:
(a) Expects lower-double digit growth and operating
margin of 8-8.5% for Lloyd’s biz in FY19. (b) Cables (40% of core business
revenue) saw flattish volume for FY18; 9% YoY growth was led by value
growth. (c) Electrical consumer durables growth of 21% YoY in FY18 was led
by market share gains in Fans (18% growth v/s flattish industry growth).
Valuation view:
We believe HAVL has built a strong business franchise, given
(a) successful development of brand, distribution and product portfolio, (b)
demonstrated track record of accelerating growth through new launches, (c)
healthy dividend payout and (d) robust return ratios. We maintain our
Buy
rating and TP to INR630, with exit multiple of 37x Mar’20E EPS of INR17.1.
(INR m)
2.3%
15.4%
Var.
FY17
FY18
FY17 FY18E MOSL
2Q
3Q
4Q
1Q
2Q
3QE
4Q
4QE
14,522 15,060 17,102 18,605 17,774 19,658 25,349 61,353 81,386 24,789
8.7
13.2
17.2
26.8
22.4
30.5
48.2
14.1
32.7
45.0
2,034 1,907 2,296 1,724 2,569 2,622 3,577 8,241 10,493 3,100
7.6
4.0
3.5 -14.0
26.3
37.5
55.8
9.2
27.3
35.0
14.0
12.7
13.4
9.3
14.5
13.3
14.1
13.4
12.9
12.5
308
301
308
336
349
363
347 1,196 1,395
313
19
15
71
34
67
55
84
122
240
94
323
286
419
348
287
278
257 1,343 1,170
238
- (190) (768)
-
-
210
(91)
119.1
0.0
2,030 1,877 2,337 1,703 2,440 2,482 3,404 8,266 10,028 2,931
572
537
622
489
730
748 1,055 2,298 3,022
874
28.2
28.6
26.6
28.7
29.9
30.1
31.0
27.8
30.1
29.8
1,458 1,151
947 1,214 1,710 1,944 2,258 5,390 7,125 2,056
22.0
-4.0 -74.1 -16.6
17.3
68.9 138.4
5.8
32.2 117.2
1,458 1,340 1,715 1,214 1,710 1,734 2,348 5,969 7,006 2,056
21.1
13.3
5.0 -16.6
17.3
29.4
37.0
16.9
17.4
19.9
16.1%
9.8%
14.2%
14 May 2018
6

P&G Hygiene and
Healthcare
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm/ Vol m
Free float (%)
S&P CNX
10,807
PG IN
32.5
298.5 / 4.6
9900 / 7300
-9/-2/1
57.0
29.4
11 May 2018
Results Update | Sector: Consumer
CMP: INR 9,200
TP: INR9,065 (-1%)
Neutral
Sales growth disappoints again; higher adspend encouraging
3QFY18 net sales declined 0.9% YoY (est. of +12%) to INR5.7b.
EBITDA fell
4.8% YoY (est. of +19%) to INR1.5b. Adj. PAT declined 8.2% YoY (est. of +16%)
to INR914m. With no detailed information on the sales performance provided
by PG, we believe that flat sales – despite a weak base – could be a result of
weak winter sales of Vicks or possible loss of market share in Whisper.
Gross margin expanded 540bp YoY to 64%.
Encouragingly, adspend to sales
grew by 330bp YoY and on absolute terms by 34% YoY. Other expenses
increased sharply by 320bp YoY to 19.8%, possibly because of poor leverage on
weak sales. EBITDA margin, thus, contracted 110bp YoY to 25.7%.
Impairment loss:
There was an impairment loss of INR126m (we have assumed
to be INR82m post tax), which was recognized in P&L in 3QFY18. This was
caused by the company moving its manufacturing from one location to
another. These assets are now classified as held for sale.
9MFY18 highlights:
Net sales rose 6% YoY to INR19.3b, EBITDA grew 2% YoY to
INR5.4b (margin down 120bp YoY to 28.2%) and adj. PAT fell 4.6% YoY to
INR3.4b.
Valuation view:
We cut EPS by 7.6% for FY18E and by 5.3% for FY19E. While
sales growth in recent quarters has been underwhelming, the increased
adspend intensity is a welcome move. Two factors make PG an attractive long-
term core holding: (1) Huge category growth potential in Feminine Hygiene
(~70% of sales) and potential for market share growth because of its
considerable moats and (2) Potentially huge margin gains from premiumization
over the longer term in Feminine Hygiene. Near-term earnings growth may
appear low v/s FY17 because of lower other income arising from significant
dividend payout in FY17. While PG remains one of our top long-term picks,
valuations of 56.7x FY19E and 49.0x FY20E EPS appear fair. Maintain
Neutral.
FY18
2Q
7,042
9.5
4,939
2,102
-8.0
29.9
135
5
71
2,033
721
35.5
1,312
-12.9
18.6
FY17
3Q
5,689
-0.9
4,225
1,464
-4.8
25.7
137
4
66
1,389
475
34.2
914
-8.2
16.1
4QE
5,532
10.0
4,149
1,383
5.5
25.0
157
5
85
1,306
418
32.0
888
13.8
16.1
23,208
2.0
16,560
6,648
9.8
28.6
561
104
726
6,709
2,388
35.6
4,320
55.8
18.6
FY18E
24,838
7.0
18,013
6,825
2.7
27.5
727
41
450
6,507
2,238
34.4
4,268
-1.2
17.2
(INR Million)
FY18
Var.
3QE
(%)
6,427
-11.5%
12.0
4,602
1,825
-19.8%
19
28.4
157
5
75
1,738
-20.1%
582
33.5
1,156
-20.9%
16.0
18.0
Financials & Valuations (INR b)
FY18 FY19E
Y/E June
Net Sales
24.8
28.2
EBITDA
6.8
8.2
NP
4.3
5.3
EPS (INR)
131.3 162.1
EPS Gr. (%)
-1.2
23.4
BV/Sh. (INR)
249.0 295.1
RoE (%)
57.0
59.7
RoCE (%)
58.1
60.6
P/E (x)
70.1
56.7
P/BV (x)
37.0
31.2
FY20E
32.6
9.5
6.1
187.8
15.8
348.5
58.4
58.6
49.0
26.4
Estimate change
TP change
Rating change
Standalone - Quarterly Earning Model
Y/E June
Net Sales
YoY Cha nge (%)
Tota l Expendi ture
EBITDA
Growth
Ma rgi ns (%)
Depreci a ti on
Interes t
Other Income
PBT
Ta x
Ra te (%)
Adj PAT
YoY Cha nge (%)
Ma rgi ns (%)
E: MOSL Es ti ma tes
1Q
6,004
11.5
4,493
1,512
55.9
25.2
127
4
225
1,605
561
34.9
1,044
50.1
17.4
FY17
2Q
3Q
6,432
5,739
-2.4
5.5
4,146
4,201
2,286
1,538
5.7
15.3
35.5
26.8
132
142
43
13
208
232
2,320
1,614
814
618
35.1
38.3
1,506
996
2.8
2.6
23.4
17.4
4Q
5,029
-5.8
3,718
1,311
-17.7
26.1
197
44
108
1,179
398
33.8
780
-28.6
15.5
1Q
6,576
9.5
4,701
1,875
24.0
28.5
128
4
35
1,777
622
35.0
1,156
10.6
17.6
14 May 2018
7

11 May 2017
Q4FY18 Results Update | Sector: Consumer
GSK Consumer
Neutral
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm/ Vol m
Free float (%)
S&P CNX
10,807
SKB IN
42.1
248.9 / 3.7
6888 / 4856
-8/-9/-5
96.0
27.5
CMP: INR5,919
TP: INR6,255(+6%)
Operating performance in-line; PAT beat led by higher other income
GSK Consumer’s (SKB) sales (incl. operating income) rose 7.0% YoY to
INR11.8b
(est. of INR11.8b). EBITDA grew 14.7% YoY to INR2.5b (est. of
INR2.5b), while adj. PAT rose 20.4% YoY to INR2.1b (est. of INR1.5b). Domestic
like-to-like sales (adjusted for GST accounting impact) grew 10% YoY (volume
growth of 8% v/s est. of +6%).
Market share expanded 20bp QoQ to 44.3% in Horlicks,
but contracted 460bp
QoQ to 11.6% in Horlicks Extensions and 10bp QoQ to 11.2% in Boost.
Gross margin expanded 250bp YoY to 68.3% in 4QFY18.
Staff costs were up
240bp YoY to 11.7% of sales and other expenses were flat at 21.1% of sales.
However, A&P to sales declined 140bp YoY to 14.3% of sales, restricting EBITDA
margin expansion to 140bp YoY (21.2% v/s est. of 20.8%).
Balance sheet:
FY18 saw a sharp improvement in the working capital cycle, led
by lower inventory days (from 42 days to 37 days), lower debtor days (from 31
days to 25 days) and an increase in creditor days (from 77 days to 81 days).
FY18 results:
Net sales, EBITDA and adj. PAT grew 8.2%, 5.7% and 6.6% YoY,
respectively. EBITDA margin contracted 50bp YoY to 20.4%.
Concall highlights:
(1)
Horlicks Protein Plus product has captured 0.4% market
share within only two months of launch.
(2)
Confident of mid-single-digit
volume growth over the medium term.
(3)
Will spend INR2-3b on capex over
the next two years.
Valuation view:
There is no major change to our forecasts, as the operating
performance was in line. Sales growth continues to be tepid, and management
is confident of only mid-single volume growth. Also, there is not any major
tailwind likely on volumes and earnings, unlike peers with higher rural sales.
EBITDA and PAT CAGR of 14% over FY18-20, thus, will be inferior to peers, and
so will be RoE of ~22%. We note that the parent is considering the sale of the
Horlicks business worldwide, which indicates the lack of confidence on the
India business (accounts for majority of Horlicks’ global sales). We value the
core business at 31x and add cash per share, as cash earnings to PBT is over
20%. We maintain
Neutral
with a target price of INR6,255 (on Mar’20E EPS).
(INR Million)
FY17
FY18
3Q
-17.0
8,604
-11.5
6,927
1,677
19.5
-9.5
171
6
559
2,059
695
33.8
1,364
-8.3
4Q
-1.0
11,028
2.4
8,848
2,180
19.8
1.9
177
9
700
2,695
936
34.7
1,759
8.4
1Q
0.0
9,853
4.4
8,190
1,664
16.9
-18.3
170
5
557
2,045
723
35.3
1,322
-17.7
2Q
2.5
11,153
3.2
8,540
2,614
23.4
6.6
177
6
550
2,981
1,057
35.5
1,924
4.7
3Q
15.0
10,347
20.3
8,307
2,040
19.7
21.7
151
2
642
2,529
892
35.3
1,637
20.0
FY17
FY18
4Q
8.0
-6.8
6.4
11,796 39,874 43,149
7.0
-3.6
8.2
9,296 31,530 34,332
2,500 8,344 8,818
21.2
20.9
20.4
14.7
-0.9
5.7
145
642
644
8
28
20
842 2,429 2,590
3,189 10,104 10,744
1,071 3,537 3,743
33.6
35.0
34.8
2,118 6,566 7,001
20.4
-4.5
6.6
FY18
4QE
6.0
11,819
7.3
9,355
2,464
20.8
13.5
188
8
591
2,860
970
33.9
1,890
7.5
Var.
(%)
-0.2%
Financials & Valuations (INR b)
Y/E Dec
2018 2019E 2020E
Net Sales
43.2
48.6
54.9
EBITDA
8.8
10.3
12.1
PAT
7.0
7.9
9.1
EPS (INR)
166.5 187.8 215.6
Gr. (%)
6.6
12.8
14.8
BV/Sh (INR)
828.6 927.1 1,024.1
RoE (%)
21.2
21.4
22.1
RoCE (%)
21.2
21.4
22.1
P/E (x)
35.6
31.5
27.5
P/BV (x)
7.1
6.4
5.8
Estimate change
TP change
Rating change
Quarterly Performance
Y/E Mar
HFD Volume Growth (%)
Net Sales
YoY Cha nge (%)
Tota l Exp
EBITDA
Ma rgi ns (%)
YoY Cha nge (%)
Depreci a ti on
Interes t
Other Income
PBT
Ta x
Ra te (%)
Adj PAT
YoY Cha nge (%)
1Q
-6.0
9,439
-5.2
7,404
2,035
21.6
-0.6
147
6
592
2,474
868
35.1
1,606
2.9
2Q
-3.0
10,803
-1.1
8,351
2,452
22.7
3.0
148
6
578
2,876
1,039
36.1
1,837
-0.1
1.5%
11.5%
12.1%
14 May 2018
8

11 May 2018
4QFY18 Results Update | Sector: Financials
Canara Bank
Neutral
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg. Val, INRm
Free float (%)
S&P CNX
10,807
CBK IN
733.2
180.6/2.8
463 / 225
-19/-43/-51
1437.0
27.5
CMP: INR246
TP: INR266 (+8%)
Elevated provisions lead to losses; asset quality stress persists
Canara Bank (CBK) reported a loss of INR48.6b, led by elevated provisions and
opex, as the bank chose to not use the RBI's dispensation on spreading out
provisioning for NCLT accounts, MTM provisions and gratuity provisions. PPoP
decline of 41% YoY was led by lower total income (-15% YoY) and higher opex
(+20% YoY), taking the CI ratio to 59.1%.
NII declined 19% QoQ, but increased 10% YoY (3QFY18 NII included INR7b of
interest on tax refund). Reported NIM was flat (+3bp) QoQ at 2.42% (domestic
NIM at 2.65% v/s 2.64 in 3Q). Other income declined 15%/44% QoQ/YoY due to
the bank recognizing MTM provisions upfront.
Loan book grew 11.6% YoY, driven by 30.5% YoY growth in retail, while
deposits growth was relatively modest at 6% YoY. On a sequential basis, the CD
ratio declined slightly to 73% (74% in 3Q).
Gross slippages spiked to INR132.4b (3.5% annualized, INR81b from the RBI's
revised guidelines, INR7.7b from restructured book and INR8.3b due to failure
of one SDR case), while upgrades/recoveries and write-offs came in at
INR12.9b and INR48b, respectively. Absolute GNPA/NNPA rose 17.8%/12.8%
QoQ to INR474b/INR285b, while GNPA/NNPA stood at 11.8%/7.5% (-146bp/-
70bp QoQ). Total stressed book stood at 9.1% of advances (11.9% in 3Q).
FY18 highlights:
Slippages for FY18 were 7.2% (v/s 3.6% in FY17), with majority
of slippages in 4Q occurring due to the RBI's revised asset framework. Credit
cost for the full year stood at 4.1% (v/s 2.2% in FY17). Calculated PCR stands at
~40%. The bank posted a loss of INR42.2b for FY18 v/s INR11.2b for FY17, led
by elevated NPA provisions and MTM provisions.
Concall highlights:
The bank guided for growth of 7-8% in loan book, ~20% in
retail book and 10% in corporate book. The bank guided for GNPA ratio of 9.5%
and net NPA ratio below 5.5% by 1HFY18 .Credit cost for FY19 would be in the
range of 1.10-1.25% (including ageing provisions). The bank is planning to raise
INR45b capital in FY19 and monetize certain non-core assets.
Valuation view:
Net stress on the books remains high, and we expect continued
high credit costs to keep returns subdued. Given weak operating profitability, we
would wait and watch developments in asset quality. We reduce FY19/20E PAT by
62%/34% to account for elevated credit costs. We arrive at an SOTP-based target
price of INR266 (0.8x FY19E ABV + INR44 for other investments). Maintain
Neutral.
Financials & Valuations (INR b)
Y/E March
2018 2019E 2020E
NII
121.6 131.0 149.4
OP
95.5 102.9 122.2
NP
(42.2)
6.1
29.3
NIM (%)
2.2
2.2
2.2
EPS (INR)
(63.5)
8.3
39.9
EPS Gr. (%)
NM
NM
NM
BV/Sh. (INR)
445.3 424.8 458.7
ABV/Sh. (INR)
160.9 208.6 280.7
RoE (%)
(12.2)
1.8
8.3
RoA (%)
(0.7)
0.1
0.4
Div. Payout (%)
NM
NM
15.1
Valuations
P/E (x)
NM
NM
6.2
P/BV (x)
0.6
0.6
0.5
P/ABV (x)
1.5
1.2
0.9
Div. Yield (%)
-
-
2.4
14 May 2018
9

Quarterly Performance
1Q
23,074
-8.3
15,847
38,921
20,732
18,189
-9.2
12,119
14,929
3,260
970
2,290
-52.2
4,653
3,213
-1.4
-0.9
323.3
214.9
9.7
6.7
50.8
FY17
2Q
3Q
24,424 24,138
-7.7
8.4
17,818 17,917
42,241 42,055
20,834 22,242
21,408 19,813
10.1
27.6
16,378 12,343
15,857 14,846
5,550
4,968
1,981
1,749
3,569
3,219
-32.5
278.8
4,843
3,271
-0.2
1.3
333.2
218.9
9.8
6.7
51.8
5,103
3,316
4.0
-0.1
343.4
223.0
10.0
6.7
52.5
4Q
27,082
14.1
23,963
51,045
21,316
29,729
80.6
18,479
27,087
2,642
500
2,142
NA
4,953
3,420
3.2
5.3
342.0
216.5
9.6
6.3
55.6
1Q
27,132
17.6
21,085
48,218
23,494
24,724
35.9
15,884
22,038
2,686
170
2,516
9.9
4,859
3,428
4.4
8.4
376.6
243.0
10.6
7.1
54.5
FY18
2Q
3Q
27,834 36,791
14.0
52.4
19,362 15,665
47,196 52,456
22,397 24,142
24,798 28,314
15.8
42.9
19,138 24,254
21,566 26,736
3,232
1,577
630
320
2,602
1,257
-27.1
-60.9
4,964
3,583
2.5
9.5
391.6
251.7
10.5
7.0
54.8
5,039
3,731
-1.3
12.5
403.1
253.0
10.4
6.8
55.8
FY17
FY18 4QFY18E
27,941
3.2
16,411
44,352
24,131
20,221
-32.0
16,884
29,073
-8,853
-880
-7,972
-472.2
5,126
3,796
3.5
11.0
443.4
288.4
0.0
0.0
35.0
4Q
29,876 98,718 1,21,633
10.3
1.1
23.2
13,317 75,544 69,429
43,193 1,74,262 1,91,062
25,546 85,123 95,579
17,647 89,140 95,482
-40.6
24.7
7.1
16,977 44,715 73,586
90,750 72,720 1,61,091
-73,104 16,420 -65,609
-24,506
5,200 -23,386
-48,598 11,220 -42,222
-2,369.0
-139.9
-476.3
5,248
3,817
6.0
11.6
474.7
285.4
11.8
7.5
39.9
4,953
3,420
3.2
5.3
342.0
216.5
9.6
6.3
36.7
5,248
3,817
6.0
11.6
474.7
285.4
12.4
7.5
39.9
V/S our
Est
6.92
7.14
(18.85)
(2.61)
5.86
(12.73)
(8.66)
0.55
212.14
725.79
2,683.79
509.58
(1,896.79)
2.37
0.55
2.46
0.61
7.05
(1.02)
11.84
7.48
4.90
Net Interest Income
% Change (Y-o-Y)
Other Income
Total Income
Operating Expenses
Operating Profit
% Change (Y-o-Y)
Core Operating Profit
Other Provisions
Profit before Tax
Tax
Net Profit
% Change (Y-o-Y)
Operating Parameters
Deposit (INR b)
Loan ( (INR b)
Deposit Growth (%)
Loan Growth (%)
Asset Quality
Gross NPA (INR b)
Net NPA (INR b)
Gross NPA (%)
Net NPA (%)
PCR (%)
Source: Company
14 May 2018
10

11 May 2018
Update
| Sector:
Technology
Mphasis
Neutral
BSE SENSEX
35,536
S&P CNX
10,807
CMP: INR988
TP: INR960(-3%)
Outperformance through Front2Back transformation
All strategic imperatives coming together
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
Avg Val, INRm
Free float (%)
MPHL IN
193
1122 / 560
3/27/53
190.9
2.8
145.0
39.6
Financials Snapshot (INR b)
2018 2019E 2020E
Y/E Mar
65.5
73.9
83.0
Net Sales
10.6
12.4
14.0
EBITDA
8.5
10.5
11.6
PAT
44.0
54.6
59.8
EPS (INR)
13.2
23.9
9.6
Gr. (%)
283.6 311.7 341.5
BV/Sh (INR)
14.6
18.3
18.3
RoE (%)
13.8
17.4
17.9
RoCE (%)
22.4
18.1
16.5
P/E (x)
3.5
3.2
2.9
P/BV (x)
Shareholding pattern (%)
As On
Mar-18 Dec-17 Mar-17
Promoter
60.4
60.4
60.4
DII
7.6
9.1
9.9
FII
22.8
21.8
20.4
Others
9.3
8.7
9.3
FII Includes depository receipts
Stock Performance (1-year)
MphasiS
Sensex - Rebased
1,050
950
850
750
650
550
We attended MPHL’s analyst meet, where the company [1] demonstrated its Front2Back
Digital transformation framework to stay ahead of the curve in new technologies, [2]
elaborated various growth drivers that have been leading to an improved performance
and [3] discussed the multitude of opportunities for a continued outperformance.
Thanks to the traction in both HP and Direct channels, MPHL has seen a sharp
turnaround in its performance in FY18. After a strong FY18, there remain several
opportunities that are yet to be addressed in both these areas, which would ensure a
sustained long-term outperformance.
While it is investing in these new areas to capitalize on the new opportunities, there
are several tailwinds available in the form of pyramid rationalization, higher fixed
price contracts and improved pricing in new technologies.
These factors are reflected in the outlook for next year of at/above-industry growth
in HP, above-industry growth in Direct, and 15-17% operating margin (100bp higher
compared to the previous target band).
MPHL ended the year with 9.8% YoY CC revenue growth, 50bp margin expansion and
5.8% PAT growth after multiple years of subdued performance. Deal wins lend
visibility of perpetuation of the current momentum. We maintain our Neutral rating
with a target price of INR960.
Marking a turnaround in FY18
MPHL witnessed a turnaround in FY18, with growth bouncing back after five
consecutive years of decline. The turnaround has been led by a strong
management team, backed by an experienced board, an optimal corporate
strategy and a focus on execution across levels. The company has brought in talent
across levels, added several leaders and beefed up regional leadership to
effectively target its focus markets.
Bring the ‘T’ back into IT with Front2Back Transformation framework
The company has been defining an optimal corporate strategy for market and a
clear path to the targeted future positioning. Cloud and Cognitive are two pillars of
its Front2Back Transformation framework to break into the Digital contracts. The
go-to-market of digital transformation in new or service transformation in legacy
would cut across its key segments of strategic customers, HP/DXC, Blackstone and
new clients by running a two-in-the-box model (client partner and delivery leader).
HP/DXC – scratching the surface
The HP/DXC channel has evolved from five consecutive years of decline to 20%
growth in FY18. Growth has been propelled by gathering various solutions,
bundling them together and creating offerings. The three strategic initiatives for
driving growth are (i) transformational deals, (ii) cloud solutions partner and (iii)
strategic engagements with all HP entities. There is ample opportunity in this
segment for growth, and MPHL has only scratched the surface. It has also started
to expand in other geographies to drive growth further.
14 May 2018
11

Direct channel – multiple opportunities
Initiatives to propel growth in the Direct channel include:
Focus on large deals:
A proactive sales approach and transformational deals
have led to USD551m in deal wins in FY18 (51% higher YoY).
Execution on the Blackstone portfolio:
With USD158m worth of deals won in
the first year itself, it is a win-win partnership, allowing cost reduction and
transformation for the companies while providing opportunities for MPHL.
Strategic account planning:
New gen services now contribute 43% of total
revenue v/s 30% at the beginning of FY17. A solutions-driven approach and high
quality of service have been aiding higher growth in Direct Core, which has seen
a CQGR of 8.2% over the last eight quarters.
Focus on growing Europe:
Europe was not being run as a region in the company,
and to change that, MPHL has reinvigorated its leadership there. With an
increased focus on client acquisition and a revamped third-party advisor
strategy, MPHL has started to see some early signs of pick-up. In 4QFY18,
revenue from Europe grew 18% QoQ and 34% YoY.
Margin improvement despite investments
The company has embarked on a margin expansion program, which would focus on
(i) restructuring people resources (pyramid optimization and grooming talent
internally), (ii) higher revenue from new gen services, leading to improved pricing
power and (iii) higher fixed-price projects (composition up to 26% in 4QFY18 from
20% in the previous year).
Guidance for FY19 remains robust
MPHL has multiple opportunities to tap on – both in HP channel (geographies
beyond the US and other entities) and Direct channel (large deals, ‘one Mphasis’
approach, Europe and Blackstone). This would lead to at/above-industry growth in
HP and above-market growth in Direct. Moreover, despite investments in sales &
marketing and capability building, tailwinds are expected to drive operating margins
in the 15-17% range.
Valuations at 16x two-year forward earnings keep us Neutral
MPHL ended the year with 9.8% YoY CC revenue growth, 50bp margin expansion
and 5.8% PAT growth after multiple years of subdued performance. Strong traction
in HP and Direct Core is an encouraging sign, which, coupled with robust deal wins,
provides visibility of industry-leading growth. We discount forward earnings by 16x
to account for growth and visibility, at par with peers like LTI, where growth is much
more broad-based in nature; growth for MPHL has remained lopsided, with
Service/Technical Help Desk contributing 80% of incremental revenue.
Maintain
Neutral with a target price of INR960.
14 May 2018
12

Tata Communications
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg. Val, INRm
Free float (%)
S&P CNX
10,807
TCOM IN
285
181.3 / 2.7
773 / 570
-8/-16/-22
457.0
25.0
11 May 2018
Q4FY18 Results Update | Sector: Telecom
CMP: INR636
TP: INR730 (+15%)
Buy
Dismal quarter; Growth business drives outlook
Subdued data EBITDA – a dampener:
Consol. revenue fell 2.6% QoQ to
INR40.1b (4% miss), mainly due to a decline in voice revenue (-10% QoQ). Data
revenue was flat QoQ at INR29.0b, but investments toward new client
acquisitions led to a steep 10% QoQ decline in data EBITDA (INR4.8b) with 200bp
margin contraction (16.7%). This dragged down consol. EBITDA to INR5.6b (-9%
QoQ, 10% miss). Net loss stood at INR1,210m; adj. for exceptional items, PAT
stood at INR411m. Traditional business revenue fell 2% QoQ, with EBITDA
margin down 120bp QoQ to 30.4%. Growth services revenue, however, grew
strongly by 8% QoQ, with margins up 340bp to -14.1%. Payment Solutions broke
even with INR3m EBITDA. For FY18, consol. revenue/EBITDA fell 5% YoY to
INR166.5b/INR22.9b (1%/3% miss), while net loss narrowed to INR3.3b.
Analyst meet highlights:
1) Expect traditional biz revenue CAGR of 5% over
FY18-21; margins to be at 29-30%. 2) Growth segment revenue CAGR is
expected to be 35% over FY18-21. 3) Expect data EBITDA margin to improve
from ~17% to 23-25% by FY21. 4) FY19 capex guidance stands at USD250-275m.
Growth business set for take-off:
Given the dismal 4Q results, we cut our
revenue/EBITDA estimate by 3-6% for FY19/20. We expect consol.
revenue/EBITDA CAGR of 5%/20% over FY18-20, led by 12%/24% CAGR in data
revenue/EBITDA. In FY18, Growth business witnessed a robust 37% revenue
jump, led by a strong order book, coupled with the payback from investments.
We expect this strong momentum to continue in FY18-20, boosting both Growth
and Data business margins, as majority of front-loaded opex is behind.
Traditional biz EBITDA should continue growing at a steady 4% CAGR over FY18-
20. Moreover, breakeven of the Payment biz EBITDA in 4QFY18 (led by higher
ATM transactions) augurs well.
Valuation view:
We reduce our SOTP-based TP to INR730 (INR750 earlier),
ascribing 9x/3x on FY20E data/voice EBITDA of INR30.2b/INR2.7b. Besides, land
demerger (in the next 6-8 months) offers additional upside of INR176.
Financials & Valuations (INR b)
2018 2019E 2020E
Y/E Mar
Net Sales
166.5 169.2 184.0
EBITDA
22.9
26.1
32.9
PAT
1.0
2.1
6.0
EPS (INR)
3.5
7.5
21.1
Gr. (%)
-67.2 115.3 182.9
BV/Sh (INR)
17.5
25.0
46.1
RoE (%)
9.4
35.1
59.4
RoCE (%)
3.8
4.7
9.0
P/E (x)
183.6
85.3
30.1
P/BV (x)
36.3
25.5
13.8
EV/EBITDA (x)
11.5
10.0
7.4
Estimate change
TP change
Rating change
Quarterly Performance (Consolidated) (INR m)
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT before EO expense
Exceptional expense
PBT
Tax
Rate (%)
MI & P/L of Asso. Cos.
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
FY17
FY18
FY17
FY18
4Q
Est.
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
FY18E Var (%)
44,569 45,091 43,601 42,937 43,100 42,176 41,146 40,086 1,76,197 1,66,508 41,594
-4
-14.0
-12.1
-14.5
-16.5
-3.3
-6.5
-5.6
-6.6
-2.9
-5.5
-3.1
37,849 38,466 37,910 37,914 37,514 36,531 35,019 34,531 1,52,138 1,43,595 35,399
-2
6,720
6,625
5,691
5,024
5,586
5,645
6,128
5,555 24,059 22,914
6,195
-10
15.1
14.7
13.1
11.7
13.0
13.4
14.9
13.9
13.7
13.8
14.9
-104bps
4,660
4,644
4,677
4,677
4,447
4,837
4,728
5,052 18,658 19,063
5,403
933
960
999
780
761
877
896
910
3,672
3,445
853
954
728
909
1,012
444
292
740
2,330
3,603
3,805
158
2,081
1,750
924
578
822
223
1,244
1,922
5,332
4,211
98
1,871
0
0
0 10,633
0
2,134
0
1,621 10,633
3,755
0
2,081
1,750
924 -10,055
822 -1,911
1,244
301 -5,301
456
98
209
734
899
923
-192
461
588
1,050
1,451
2,364
3,549
32
35.3
51.4
99.9
1.9
56.0
-30.8
84.4
481.6
-44.6
778.2
33.0
-6
-5
-7
-30
39
1
92
60
-25
193
1
1,353
856
7 -9,833
322 -2,500
101 -1,210 -7,640 -3,286
64
NM
1,353
856
7
800
322
291
-37
411
3,016
988
64
539
212.5 1,321.3
-96.6
206.5
-76.2
-66.0 -597.3
-48.6
210.0
-67.2
-89.6
3.0
1.9
0.0
1.9
0.7
0.7
-0.1
1.0
1.7
0.6
0.2
87bps
14 May 2018
13

11 May 2018
4QFY18 Results Update | Sector: Oil & Gas
Gujarat Gas
Buy
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
Financials & Valuations (INR b)
Y/E Mar
2018 2019E
Net Sales
61.7
76.4
EBITDA
9.0
10.8
PAT
2.9
4.6
EPS (INR)
21.2
33.5
EPS Gr. (%)
32.0
58.1
BV/Sh (INR)
134.1
161.3
RoE (%)
16.7
22.7
RoCE (%)
16.5
20.3
P/E (x)
39.8
25.2
P/BV (x)
6.3
5.2
EV/EBITDA (x)
15.3
12.3
S&P CNX
10,807
GUJGA IN
EBITDA above estimate led by better volumes and EBITDA/scm
137.7
GUJGA reported EBITDA of INR2.2b (+52% YoY, +11% QoQ), slightly above
121.6/1.9
our estimate of INR2.1b, led by better-than-expected volumes and margins.
974 / 722
PAT of INR660m (+99% YoY, +10% QoQ) came in lower than our estimate of
-7/-11/-9
INR713m due to a higher tax rate of 43.4% v/s 34.4% in 3QFY18 and 20.2%
185.0
in 4QFY17. For FY18, EBITDA grew by 20% YoY to INR8.9b and PAT by 32%
39.1
CMP: INR843
TP: INR1,122 (+33%)
2020E
84.8
12.3
5.7
41.6
24.2
195.1
23.3
23.2
20.3
4.3
10.5
Estimate change
TP change
Rating change
YoY to INR2.9b.
Strong PNG household volumes:
PNG industrial/commercial volumes grew
9% YoY (+4% QoQ) to 4.7mmscmd, while PNG household volumes rose 30%
YoY (+38% QoQ) to 0.7mmscmd. For FY18, PNG industrial/commercial
volumes grew 17% YoY to 4.4mmscmd and PNG household volumes rose
15% YoY to 0.5mmscmd.
CNG volumes up 10% YoY:
CNG volumes stood at 1.4mmscmd (+10% YoY,
+5% QoQ) in 4QFY18. For FY18, CNG volumes grew 10% YoY to 1.3mmscmd.
Unless CNG volumes become a larger contributor, the company would
continue witnessing volatility in volumes and margins, in our view.
EBITDA/scm at INR3.7:
EBITDA/scm rose 37% YoY (+6% QoQ) to INR3.7
(above our estimate of INR3.6) in 4QFY18 and 3% YoY to INR4.0 in FY18.
Management recommended a dividend of INR4/share.
Valuation and view
We expect volumes to continue growing in FY19/20, primarily led by the
PNG industrial/commercial segment. Increasing CNG volumes is a positive,
as it would reduce volatility in volumes and margins for GUJGA.
For FY19/20, we model volumes of 6.88/7.63mmscmd and EBITDA/scm of
INR4.3/4.4. We value the company at 27x FY20E EPS of INR41.6. Maintain
Buy
with a TP of INR1,122 (upside of 33%).
FY17
FY18
FY17
2Q
3Q
4Q
1Q
2Q
3Q
4Q
12,370 12,309 14,002 14,780 13,914 15,713 17,336 50,927
-21.3 -17.1
1.6
20.7
12.5
27.7
23.8 -16.6
2,094 1,709 1,463 2,698 2,027 1,999 2,227 7,440
16.9
13.9
10.4
18.3
14.6
12.7
12.8
14.6
645
653
643
666
683
688
682 2,675
541
539
476
496
499
487
479 2,090
52
75
71
78
89
91
99
371
959
593
415 1,615
934
915 1,165 3,047
265
170
84
571
323
315
506
839
27.6
28.6
20.2
35.4
34.6
34.4
43.4
27.6
695
423
331 1,044
611
600
660 2,207
150.3
31.5 -63.9
39.4 -12.1
41.9
99.0
6.9
5.6
3.4
2.4
7.1
4.4
3.8
3.8
4.3
5.2
5.3
6.1
6.1
5.7
6.3
6.8
5.4
1.2
1.2
1.2
1.3
1.3
1.3
1.4
1.2
3.6
3.7
4.3
4.4
4.0
4.5
4.7
3.8
0.4
0.5
0.6
0.4
0.5
0.5
0.7
0.5
4.4
3.5
2.7
4.8
3.8
3.5
3.7
3.8
FY18
61,743
21.2
8,951
14.5
2,718
1,961
357
4,629
1,715
37.0
2,914
32.0
4.7
6.2
1.3
4.4
0.5
4.0
(INR Million)
FY18
4QE Var (%)
17,967
-3.5
28.3
2,138
4.1
11.9
718
-5.0
472
1.5
116
-14.8
1,065
9.4
351
43.9
33.0
713
-7.6
115.3
4.0
6.6
3.1
1.3
1.2
4.7
0.0
0.5
35.2
3.6
1.0
Standalone - Quarterly Earning Model
Y/E March
Net Sales
YoY Change (%)
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Reported PAT
YoY Change (%)
Margins (%)
Total volume (mmscmd)
CNG
PNG - Industrials/commercial
PNG - Households
EBITDA (INR/scm)
E: MOSL Estimates
1Q
12,247
-26.7
2,173
17.7
632
534
62
1,070
321
30.0
748
27.7
6.1
5.1
1.1
3.5
0.4
4.7
14 May 2018
14

11 May 2018
1QCY18 Results Update | Sector: Metals
Rain Industries
Buy
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm/ Vol m
Free float (%)
S&P CNX
10,807
RINDL IN
CMP: INR275
TP: INR426 (+55%)
336
92.4 / 1.4
476 / 92
-32/-36/142
1100.0
58.9
Strong results, but CPC volumes disappoint
CT Pitch remains strong, while ACM is recovering; Maintain Buy
RAIN’s 1QCY18 EBITDA increased 50% YoY (-4% QoQ) to INR6.6b, but missed our
estimate of INR7.7b due to a QoQ decline in CPC shipments, as against our
expectation of growth. There has been regrouping of segments – some of the
value-added products from CT Pitch and other carbon segments have been moved
to the chemical segment, which is now called as advanced carbon materials (ACM).
Interest cost declined 29% QoQ (-23% YoY) due to refinancing of bonds. Adj. PAT
rose 116% YoY to INR2.7b, led by lower tax rates in the US and Belgium.
Carbon – CPC volumes disappoint, but CT Pitch getting stronger:
CPC volumes
declined 10% QoQ to 389kt (est. of 482kt) due to a delay in shipments to Indian
smelters, led by prolonged negotiations over pass-through of import duty hike
by 750bp. CT Pitch continues to look up, as volume increased 9% QoQ and 5%
YoY to 133kt, while NSR increased 29% QoQ to USD864/t. Carbon segment
volumes declined 3% QoQ to 662kt, while EBITDA/t was down 1% QoQ (+116%
YoY ) to USD128/t. Segment EBITDA doubled YoY to INR5.5b.
ACM EBITDA has started improving:
EBITDA rose 3% QoQ to INR908m and
EBITDA per ton grew 10% QoQ to USD127/t. RAIN announced USD66m capex
to add a 30kt Dicyclopentadiene (DCPD/C9) resin plant in Germany to capitalize
on the rapidly growing market for water-white resins for adhesive application.
Maintain Buy:
Margins in CPC business (50% of revenue) have peaked, but CT
Pitch remains very strong, while ACM is on a recovery path. RAIN is capitalizing
on the growing market for niche products in ACM and is investing to leverage
its patented technologies in resins. We have toned down CPC volumes and cut
margins, leading to a 7% cut in EBITDA and an 11% cut in PAT. We lower TP by
11% to INR426/share (Exhibit 2). Stock trades at 5x EV/EBITDA. Maintain
Buy.
CY17
CY18
CY17 CY18E CY19E
v/s Est.
1Q
4Q
1Q
2QE
3QE
4QE
1QE
%
24,680 31,448 33,062 36,230 37,657 36,373 113,007 143,321 157,380 36,237
-9
14
32
34
37
23
16
21
27
10
47
4,414 6,872 6,621 6,932 7,126 6,634 22,702 27,313 28,972 7,742
-14
17.9
21.9
20.0
19.1
18.9
18.2
20.1
19.1
18.4
21.4
1,536 1,465 1,180 1,163 1,163 1,163 5,947 4,669 4,152 1,163
1
1,366 1,260 1,230 1,204 1,182 1,219 5,256 4,835 5,035 1,237
-1
206
198
61
311
270
212 1,134
854
944
290
-79
1,718 4,345 4,272 4,876 5,051 4,464 12,633 18,662 20,728 5,632
-24
-670
-302
0
0
0
0
-973
0
0
0
1,048 4,043 4,272 4,876 5,051 4,464 11,661 18,662 20,728 5,632
-24
400
868 1,403 1,658 1,717 1,518 3,749 6,296 7,048 1,915
-27
38.2
21.5
32.8
34.0
34.0
34.0
32.1
33.7
34.0
34.0
647 3,175 2,869 3,218 3,334 2,946 7,912 12,367 13,680 3,717
-23
55
103
145
41
41
85
285
312
279
44
230
1,263 3,374 2,724 3,177 3,292 2,861 8,599 12,054 13,402 3,673
-26
331.5 136.8 115.7 109.7
34.0
-15.2
72.7
40.2
11.2 190.9
Financials & Valuations (INR b)
Y/E Dec
2017 2018E 2019E
Net Sales
113.0 143.3 157.4
EBITDA
22.7
27.1
29.0
PAT
8.0
11.8
13.4
EPS (INR)
23.7
35.2
39.8
Gr. (%)
238.1
48.5
13.2
BV/Sh (INR)
117.3 150.1 187.5
RoE (%)
22.9
26.3
23.6
RoCE (%)
19.7
24.3
26.0
P/E (x)
16.0
7.8
6.9
P/BV (x)
3.2
1.8
1.5
Estimate change
TP change
Rating change
Quarterly Performance (Consolidated) – INR million
Y/E December
Net Sales
Change (YoY %)
EBITDA
As % of Net Sales
Interest
Depreciation
Other Income
PBT (before EO Inc.)
EO Income(exp)
PBT (after EO Inc.)
Total Tax
% Tax
Reported PAT
Less: Min. Int. & assc.
Adjusted PAT
Change (YoY %)
14 May 2018
15

RESULTS
FLASH
BSE SENSEX
35,536
S&P CNX
10,807
Solar Industries
Neutral
8 May 2018
Results Flash | Sector: Capital Goods
CMP: INR1,065
TP: INR1,100(+3%)
Conference Call Details
Date:
14
May 2018
Time:
11:00am IST
Dial-in details:
+91-22-6280 1123
th
Above estimate operational performance led by better than expected
overseas and exports performance
Consolidated revenue stood at INR5.8b (+30% YoY) ahead of our estimate of
INR5.0b, driven by better than estimated overseas performance. Revenue
contribution from overseas and export segment stood at INR2.0b (+80.7% YoY)
driven by currency stabilization. Standalone revenue stood at INR3.9b (+15%
YoY). Revenue from defence segment stood at INR187m during the quarter
EBIDTA for the quarter stood atINR1.2b (+28.5% YoY) ahead of our estimate of
INR0.95b led by better than estimated margins.
EBIDTA margin for the quarter stood at INR20.5% (-30bps YoY) ahead of our
estimate of 19.1%. Favourable revenue mix during the quarter led to better
than estimated margins.
PAT for the quarter stood at INR678m (+21% YoY), ahead of our estimate of
INR547m.
Valuation and View:
We have neutral rating on the stock with target price of INR1,100 valuing the
company at 30x its FY20EPS of INR36.6. The stock currently trades at 35/28 its
FY19/20E EPS of INR30/38 respectively.
Financials & Valuations (INR b)
FY18 FY19E
Y/E Mar
Net Sales
19.2
22.8
EBITDA
4.1
5.0
NP
1.3
1.8
EPS (INR)
24.4
30.2
EPS Gr. (%)
18.2
23.8
BV/Sh. (INR)
RoE (%)
RoCE (%)
Div. Yield
119.8
21.9
23.9
0.4
143.9
22.9
25.5
0.5
FY20E
29.4
6.2
2.4
38.0
26.1
174.3
23.9
27.0
0.6
Quarterly Perfor. (Consol.)
Y/E March
Sales
Change (%)
EBITDA
Change (%)
As of % Sales
Depreciation
Interest
Other Income
PBT
Tax
Effective Tax Rate (%)
Reported PAT
Change (%)
Adj PAT
Change (%)
1Q
4,030
4.8
868
20.7
21.5
94
68
32
738
237
32.1
501
9.6
471
13.9
FY17
2Q
3Q
3,174 4,215
-4.3
9.5
696
768
0.2
0.3
21.9
18.2
98
95
73
68
0
47
525
652
133
157
25.4
24.1
391
495
-5.2
12.1
391
495
6.1
20.3
4Q
4,421
7.6
919
6.9
20.8
101
63
44
799
240
30.0
560
22.6
560
29.2
1Q
4,667
15.8
1,010
16.4
21.6
125
50
25
860
261
30.4
599
19.5
548
16.3
FY18
2Q
3Q
4,084 4,657
28.7
10.5
872 1,043
25.4
35.9
21.4
22.4
128
137
79
106
33
26
699
826
216
249
30.9
30.2
483
577
23.3
16.4
483
577
23.3
16.4
FY17
4Q
5,753
30.1
1,181
28.5
20.5
123
84
38
1,012
334
33.0
678
21.1
678
21.1
15,800
9.1
3,239
6.5
20.5
387
269
132
2,715
767
28.3
1,947
3.6
1,947
FY18
19,161
21.3
4,116
27.1
21.5
513
327
121
3,396
1,061
31.2
2,336
4.5
2,285
FY18
4QE
4,975
14.1
951
10.6
19.1
148
55
54
803
256
31.9
547
9.3
547
9.3
(INR M)
Var.
Vs Est
15.6
24.2
26.1
23.9
23.9
14 May 2018
16

11 May 2018
Q4FY18 Results Update | Sector: Healthcare
Laurus Labs
Buy
BSE SENSEX
35,536
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
S&P CNX
10,807
LAURUS IN
Growth to pick up from FY19
106
Operationally in-line; PAT hit by higher interest/depreciation and tax
53.0 / 0.8
outgo:
In 4QFY18, Laurus delivered 18.3% YoY revenue growth to INR5.6b
634 / 480
(our estimate: INR5.4b), led by 27% YoY growth in ARV-API sales (64% of
-8/-15/-29
73.0
total sales), 63% YoY growth in Synthesis business (8% of total sales), and
69.4
addition of formulation sales of INR140m (2.4% of total sales). Pricing
CMP: INR488
TP: INR586 (+20%)
Financials & Valuations (INR b)
2018 2019E
Y/E Mar
20.7
24.6
Net Sales
4.1
5.5
EBITDA
1.7
2.9
PAT
15.8
27.3
EPS (INR)
-10.9
72.1
Gr. (%)
140.2
166.9
BV/Sh (INR)
11.9
17.8
RoE (%)
9.7
12.8
RoCE (%)
30.7
17.9
P/E (x)
3.5
2.9
P/BV (x)
2020E
29.0
6.7
3.6
34.3
25.8
200.6
18.7
13.8
14.2
2.4
Estimate change
TP change
Rating change
pressure in Hep-C and higher fixed overheads related to recently-
commissioned facilities led to 410bp YoY decline in EBITDA margin to 20.9%
(our estimate: 21%). Higher depreciation, interest and tax outgo led to 39%
YoY fall in PAT to INR451m (our estimate: INR528m).
Higher base in revenue and fixed operating cost impacted FY18
performance:
After six years of strong growth, Laurus delivered its second
consecutive year of moderate revenue growth (up 8.6% to INR20.7b) in
FY18. Gross margin expanded 90bp to 48.6%, an all-time high. However,
EBITDA margin shrank 140bp YoY to 20% due higher operating expenses
related to recently commissioned facilities. Higher depreciation and tax
outgo led to 12% YoY decline in PAT to INR1.7b.
Valuation and view:
We have cut our EPS estimates by 6% to INR27.4 for
FY19 and by 3% to INR34.4 for FY20 to factor lower growth in ARV-API
business, slower ramp-up in formulation business and higher tax rate.
Accordingly, we have revised our price target to INR586 (from INR611
earlier), valuing the stock at 18x 12M forward earnings. We remain positive
on Laurus on the back of healthy demand in ARV category, forward
integration to formulations for ARV as well as regulated markets, and strong
momentum in Synthesis business. RoE should improve from 12% in FY18 to
19% by FY20. Reiterate
Buy.
FY17
FY18
FY17
2Q
3Q
4Q
1Q
2Q
3Q
4Q
5,254 5,050 4,735 4,912 5,386 4,789 5,602 19,204 20,690
NA 12.2
-3.6 17.9
2.5 -5.2 18.3 104.0
7.7
4,151 4,062 3,548 3,947 4,260 3,916 4,434 15,076 16,557
1,103
988 1,187
965 1,126 874 1,169 4,129 4,133
21.0 19.6 25.1 19.6 20.9 18.2 20.9
21.5
20.0
253
263
267
298 301 310
346 1,031 1,254
247
297
148
191 195 178
233
970
796
76
128
89
75
66
99
51
316
292
680
555
861
552 696 486
641 2,443 2,374
0
0
0
0
0
0
0
0
0
680
555
861
552 696 486
641 2,443 2,374
171
81
118
163 208 137
190
451
698
25.2 14.6 13.7 29.5 29.9 28.2 29.7
18.4
29.4
0
0
0
0
0
0
0
10
0
508
474
743
389 488 349
451 1,982 1,676
508
474
743
389 488 349
451 1,982 1,676
NA 17.9 39.0 51.7 -4.1 -26.4 -39.3 111.6
-15.4
9.7
9.4 15.7
7.9
9.1
7.3
8.0
10.3
8.1
(INRm)
FY18
FY18
4QE
5,383
4,252
1,130
320
167
70
713
713
185
vs Est
(%)
4.1
4.3
3.4
8.3
38.9
-27.4
-10.2
-10.2
2.5
Consol. - Quarterly Earning Model
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT before EO expense
Extra-Ord expense
PBT
Tax
Rate (%)
MI & Profit/Loss of Asso. Cos.
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
1Q
4,165
NA
3,315
850
20.4
248
279
23
346
0
346
80
23.0
10
256
256
NA
6.2
528
528
-14.6
-14.6
14 May 2018
17

March 2018 Results Preview | Consumer
Hindustan Unilever
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
HUVR IN
2163.9
2918 / 45
1415 / 899
4 / 8 / 35
CMP: INR1,348
TP: INR1,530 (+13%)
Buy
We expect Hindustan Unilever’s revenue to grow 9.4% YoY, with
underlying domestic volume growth of 7% in 4QFY18.
PFAD prices are down 15% YoY (down 2% QoQ) and LAB prices
are up 6.7% YoY (up 4% QoQ).
Gross margins are likely to expand 160bp YoY to 52.6%.
We expect operating margin to expand by 110bp YoY to 21.2% in
4QFY18, leading to EBITDA growth of 15.6% YoY.
Adj. PAT is likely to grow 16.6% YoY to INR13b in the quarter.
The stock trades at 47.7x/40.5x FY19E/20E EPS of
INR28.3/INR33.3; maintain
Buy.
Financial Snapshot (INR b)
Y/E March
Sales
EBITDA
Adj. PAT
Adj. EPS (INR)
EPS Gr. (%)
BV/Sh.(INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
Div. Yield (%)
68.7
45.0
47.9
1.2
56.3
43.1
40.7
1.4
47.7
42.4
33.7
1.8
40.5
42.0
28.7
2.1
2017 2018E 2019E 2020E
313.0 337.6 387.3 439.7
60.5
42.5
19.6
1.9
30.0
66.5
84.0
71.4
51.9
24.0
22.1
31.3
78.2
81.4
85.8 100.8
61.2
28.3
17.9
31.8
72.0
33.3
17.8
32.1
89.6 104.1
83.9
84.7
88.5 100.7 118.6 138.7
Key issues to watch for
Comments on volume growth and consumer demand
environment.
Prospects of rural recovery.
Performance of Lever Ayush.
Quarterly performance
Y/E March
Domestic volume growth (%)
Net Sales
YoY Change (%)
COGS
Gross Profit
Margin %
Operating Exp
% to sales
EBITDA
YoY Change (%)
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Adjusted PAT
YoY Change (%)
Reported Profit
E: MOSL Estimates
1Q
4.0
81,270
3.6
39,555
41,715
51.3
25,368
31.2
16,347
8.1
20.1
933
60
1,076
16,431
5,411
32.9
11,277
6.1
11,727
FY17
2Q
-1.0
78,427
1.4
39,620
38,807
49.5
24,760
31.6
14,046
5.1
17.9
945
49
2,528
15,580
4,807
30.9
10,818
9.3
10,956
3Q
-4.0
77,060
-0.7
37,440
39,620
51.4
26,060
33.8
13,560
-5.2
17.6
1,000
50
820
13,330
4,480
33.6
9,199
-10.2
10,380
4Q
4.0
82,130
6.4
40,220
41,910
51.0
25,400
30.9
16,510
12.2
20.1
1,080
60
830
16,200
4,360
26.9
11,180
7.6
11,830
1Q
0.0
85,290
4.9
40,840
44,450
52.1
25,790
30.2
18,660
14.1
21.9
1,140
60
1,130
18,590
5,630
30.3
12,920
14.6
12,830
FY18
2Q
4.0
83,090
5.9
39,290
43,800
52.7
26,980
32.5
16,820
19.7
20.2
1,150
60
2,040
17,650
5,250
29.7
12,360
14.2
12,760
3Q
11.0
85,900
11.5
39,050
46,850
54.5
30,050
35.0
16,800
23.9
19.6
1,210
50
1,520
17,060
3,590
21.0
11,980
30.2
13,260
4QE
7.0
89,864
9.4
42,556
47,308
52.6
28,218
31.4
19,090
15.6
21.2
1,111
96
850
18,732
5,699
30.4
13,033
16.6
13,033
Ind AS
FY17
0.8
318,887
2.7
156,835
162,052
50.8
101,588
31.9
60,463
5.1
19.0
3,958
219
5,254
61,541
19,058
31.0
42,474
3.2
44,893
Ind AS
FY18
5.5
344,144
7.9
161,736
182,408
53.0
111,038
32.3
71,370
18.0
20.7
4,611
266
5,540
72,032
20,169
28.0
51,863
22.1
51,863
14 May 2018
18

March 2018 Results Preview | Sector: Capital Goods
Blue Star
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
BLSTR IN
95.6
76 / 1
845 / 587
7 / -3 / 1
CMP: INR795
TP: INR780 (-2%)
Neutral
Financial Snapshot (INR b)
Y/E March
2017 2018E 2019E 2020E
Net Sales
EBITDA
Adj. PAT
EPS(INR)
EPS Gr. (%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
Div Yield (%)
*Consolidated
62.3
9.6
31.3
1.0
47.9
9.5
25.3
1.3
32.3
8.8
19.1
1.9
25.5
8.1
15.6
2.4
44.0
2.4
1.2
-6.0
79.2
14.8
61.5
44.0
2.4
47.8
3.0
1.6
36.0
83.6
18.5
61.5
47.8
3.0
57.5
3.9
2.3
48.2
90.0
26.5
61.5
57.5
3.9
65.4
4.8
3.0
26.9
98.2
32.1
61.5
65.4
4.8
Unitary cooling division (UCP) is likely to report revenue growth of
3% YoY; however, on a like-to-like basis, we expect growth of
18%, given pickup in summer and price hike taken by the
company post implementation of new norms.
We expect revenue growth of 13% YoY in the MEP segment, given
pickup in execution of orders in hand post contract renegotiation,
which happened on account of GST implementation.
Operating margin is expected to expand 160bp YoY to 7.1%, led
by better margins in the MEP segment (+90bp YoY). Operating
profit is expected to grow 41% YoY.
Volatile crude prices have raised apprehensions over the pace of
order awards and execution in the Middle East. Even in the
domestic market, new project awards remain constrained.
Maintain
Neutral.
Key issues to watch
Impact of implementation of new efficiency norms on Blue
Star’s market share and sales.
Sustainability of profitability and capital employed in MEP
business.
Quarterly performance (Consolidated)
Y/E March
Sales
Change (%)
EBITDA
Change (%)
As of % Sales
Depreciation
Interest
Other Income
PBT
Tax
Effective Tax Rate (%)
Reported PAT
(before MI and sh. of associates)
Change (%)
Adj PAT
Change (%)
1Q
12,117
18.8
791
5.1
6.5
135
92
85
649
145
22.3
504
35.7
514
38.3
FY17
2Q
3Q
8,911
9,224
6.2
17.1
422
386
-4.6
9.5
4.7
4.2
150
155
88
85
81
11
266
157
73
15
27.6
9.7
193
-1.3
200
-4.6
142
-10.6
145
-7.0
4Q
13,756
17.8
756
25.6
5.5
166
114
37
514
133
25.9
381
-2.5
372
-6.5
1Q
14,611
20.6
903
14.1
6.2
125
48
37
766
183
23.9
583
15.7
585
13.8
FY18
2Q
3Q
8,390
9,835
-5.8
6.6
492
535
16.6
38.8
5.9
5.4
158
172
59
74
12
14
288
303
84
93
29.3
30.7
204
5.5
208
4.0
210
48.3
188
29.7
FY17
4QE
14,977
8.9
1,069
41.4
7.1
153
96
38
858
261
30.4
597
56.8
602
61.8
44,008
15.4
2,355
2.0
5.4
606
378
150
1,521
367
24.1
1,165
-0.1
1,165
-0.1
FY18E
47,812
8.6
3,002
27.5
6.3
608
276
100
2,218
621
28.0
1,585
36.0
1,585
36.0
14 May 2018
19

In conversation
1. TITAN : Targeting a 20-25% growth in Jewellery business this
year; S Subramaniam, CFO
It has been a phenomenal year for the company. Have outdone internal targets.
Jewellery business has outperformed on revenue and gross margin. Targeting a
20-25 percent growth in jewellery business in FY19.
Jewellery business’ studded ratio was good; saw good margins in plan gold biz
too.
Will be able to maintain gross margin around current levels.
Cater to more than 15 million customers in watches, about a couple of million in
eye wear business and a couple of million in the jewellery business. So about 20
million.
Company is more focused on topline growth; looking at achieving market share
gain.
2. ASIAN PAINTS : See reasonable market share growth; KBS
Anand, MD & CEO
Demand was much stronger in East and North of India but competition
impacted the South India region.
For the past 53 years the company has consistently gained market share and
reasonably confident of gaining in the years ahead as well. Saw marginal gains in
market share last year.
Will watch rupee movement closely going forward. Will take price hike if rupee
weakens.
Growth in Ess-Ess and Sleek picked up in the last six months.
Company’s growth is intrinsically linked to the growth of the Indian economy
and GDP. The overall paint industry is linked to construction, housing,
maintenance and the general employment generation in the economy.
3. INDIAN BANK : AIM to bring down gross NPAS below 6%, net
NPAS below 3%; Kishor Kharat, MD and CEO
Slippages were at Rs 1,700 crore on account of RBI’s regulation.
However, the quarterly trend in slippages is under control. Do not expect lumpy
accounts to slip in the coming quarters.
Rs 2079 crore of restructured book is performing well.
NPAs had peaked out last year but escalated in Q4 because of revised
guidelines. However, going forward, expects the gross NPAs to peak out at
current levels and aim to bring it down to less than 6 percent.
Currently, the gross NPA is around 7.3 percent and net NPA is at 3.81 percent.
The net NPA is also expected to be below 3 percent in FY19.
14 May 2018
20

4. MPHASIS : See a very large opportunity in the Blackstone
portfolio; Nitin Rakesh, Chief Executive Officer and Executive
Director
Glad with the progress company made so early in tenure with Blackstone. It’s a
strategic owner. There are almost 100 companies in their portfolio. Started with
a handful in FY18and will mine more.
Company is pleased to see bulk of new deal wins coming from the right areas.
Have factored in forex headwinds and wage hikes for the year ahead.
Will be the last person to bet on dollar-rupee movement but follow a very
consistent and stable hedging policy and will continue to do that.
5. UJJIVAN FINANCIAL SERVICES : Will reach 520 branches this
year from 180 branches currently; Samit Ghosh, MD and CEO
Currently operate with 180 branches, may reach 520 branches this year.
Aiming at total deposits of Rs 8000 crore in FY19 of which retail deposits will be
Rs 2000-3000 crore.
Financial year 2018 was a challenging year for the firm due to demonetisation.
However, microfinance disbursements were now back to pre-demonetisation
levels.
The company expects housing and MSE book to grow double due to base effect
and also plans to launch personal loans and loans for two wheelers for
microfinance customers.
Company is in semi-urban market in Karnataka and historically, farm loan waiver
has not had any significant impact on microfinance players.
Company slowed down branch expansion which aided in operating efficiency.
14 May 2018
21

From the think tank
1. The dream of a harvard on the ganga’s banks
A new generation of private universities has begun to find its feet in different
parts of India. These new universities are welcome in a country in which the lack
of quality higher education means that students spend around $6 billion every
year to study abroad. However, the new educational centres should not just be
seen as ways to stem this outflow of foreign exchange. They have the potential to
act as catalysts for the broken system of public universities as well. The private
universities could do what a bunch of educational institutions did during the years
of the freedom struggle—when private Indian capital stepped in to fund colleges
for a country that was changing rapidly. The story of Ahmedabad University is
instructive because its roots lie in the educational enterprise of another
generation. In 1935, business leaders in Ahmedabad set up the Ahmedabad
Education Society under the guidance of Vallabhbhai Patel, to establish colleges in
the city.
2. Financing reindustrialization: bring back development banks
Many commercial banks in India are under financial stress. This has imparted a
fragility to the banking system as a whole. Scams and scandals surface from time
to time, making headline news. There is also a quiet crisis that runs deep. It is
not audible yet. But it is mounting, since recurring failures of regulation or
governance have not led to any accountability or corrective action. Some
erosion of confidence is no surprise. If the problem continues to be neglected, a
trust deficit could develop over time. The fundamental problem is the non-
performing assets (NPAs) of commercial banks. An asset becomes non-
performing when it ceases to yield any interest or income for the bank. Simply
put, it is a bad loan. Such NPAs are rising rapidly. This rise is partly a
consequence of the far more rigorous asset quality review by the Reserve Bank
of India (RBI) based on its income-recognition and asset-classification norms.
The RBI financial stability report shows that for all commercial banks, gross NPAs
as a proportion of total assets were 9.6% in March 2017 and an estimated 10.8%
in March 2018.
3. India and Nepal are scaling up their ties
Prime Minister Narendra Modi will be visiting Nepal from 11-12 May. This visit is
taking place approximately a month after Nepalese Prime Minister K.P. Sharma Oli
visited New Delhi. These back-and-forth visits indicate that India and Nepal are
working towards scaling up their bilateral relationship. What explains the frequent
meetings between the premiers of the two countries? The left alliance
government in Nepal, headed by Oli, enjoys a strong presence in the national
parliament as well as in provincial governments. Given the current domestic
political stability, there is greater confidence in Nepal’s external engagements.
Further, there seems to be a growing recognition in India as well as in Nepal that
deterioration in relations between the two countries, with close socio-economic-
cultural relations, is not desirable. There is a strong opinion that India is reaching
out to Kathmandu because of China’s growing presence in Nepal. While there is
an element of truth in such an assertion, it fails to capture the depth and history
of India-Nepal engagement.
14 May 2018
22

4. A welcome move by RBI on cross-border mergers
RBI has rolled out the long-awaited regulations to allow cross-border mergers
that could boost foreign direct investment into the country. In March, RBI
notified that the Foreign Exchange Management (Cross Border Merger)
Regulations, 2018, will cover both inbound and outbound investments. The
ministry of corporate affairs had already notified Section 234 of the Companies
Act, 2013, paving way for the merger and amalgamation of a foreign company
with an Indian company and vice-versa. Earlier, Section 234 required prior
approval of RBI, but now RBI has stated that any transaction done in compliance
with merger regulations will be deemed to have its prior approval. This will have
a huge positive impact on the timeliness of cross-border mergers and
acquisitions.
International
5. Counting the costs of trump’s Iran policy
With President Donald Trump’s announcement that the United States will begin
reimposing sanctions against Iran, the short, strange life of the 2015 Iran nuclear
deal – formally known as the Joint Comprehensive Plan of Action – has entered
a new and dangerous phase. Trump believes that, by withdrawing from the
JCPOA, he can pressure Iran to agree to a new, more comprehensive deal that
would cover not just the country’s nuclear program, but also its ballistic missile
tests, provocative regional behavior, and human-rights violations. But, as
America’s partners and allies have noted, this is a highly risky gambit – one that
contradicts the underlying logic of the deal. The decision to withdraw from the
JCPOA, despite Iranian compliance with all of its provisions, is likely to make
addressing Iran’s nuclear program more difficult, not least because it will
strengthen the position of the country’s hardliners. More broadly, it threatens
to rob the world of a new and innovative approach to global governance and
multilateral diplomacy at a time when such approaches are badly needed.
14 May 2018
23

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SBI
Union Bk
Aggregate
NBFCs
Aditya Birla Cap
Bajaj Fin.
Capital First
Cholaman.Inv.&Fn
Dewan Hsg.
GRUH Fin.
HDFC
HDFC Stand. Life
Indiabulls Hsg
L&T Fin Holdings
LIC Hsg Fin
Reco
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Sell
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Neutral
CMP TP % Upside
EPS (INR)
EPS Gr. YoY (%)
P/E (x)
P/B (x)
ROE (%)
(INR) (INR) Downside FY18E FY19E FY20E FY18E FY19E FY20E FY18E FY19E FY18E FY19E FY18E FY19E
865 1000
162 179
2816 3550
725 869
18602 19096
1438 1845
30861 34714
1172 1531
946 826
262 301
3616 4052
869 914
239 274
8738 10468
339 437
331 565
624 709
16
11
26
20
3
28
12
31
-13
15
12
5
14
20
29
71
14
28.3
5.4
147.9
20.0
459.1
64.0
799.6
27.9
39.1
8.2
185.1
39.7
9.6
266.7
8.1
25.5
14.1
34.0 40.0 0.9
7.2
9.2 28.8
167.8 197.2 4.8
26.4 34.8 52.8
582.9 694.4 -3.0
84.9 115.3 -31.5
1,046.3 1,340.9 27.0
38.2 51.0 18.8
49.5 59.0 103.5
10.1 12.8 0.4
201.2 229.1 9.5
46.9 51.2 45.1
13.7 16.6 107.8
349.9 444.8 7.3
12.5 17.5 5.0
56.6 58.7 28.8
22.4 32.4 20.4
17.7
19.4
9.7
7.5
5.8
79.3
17.8
3.2
83.0
10.0
40.5
22.1
4.1
24.3
35.8
11.5
11.9
8.2
94.5
24.1
3.8
104.4
14.4
50.1
29.5
5.3
32.1
-92.8
13.8
-82.3
-1.3
19.4
-31.0
0.3
25.2
LP
21.3
27.3
-22.9
26.3
4.0
20.3
33.1
13.5
32.1
27.0
32.8
30.9
37.0
26.5
23.5
8.6
18.0
43.1
31.2
54.7
121.8
58.8
46.4
#####
22.4
710.5
21.3
16.9
68.7
7.2
37.9
13.5
24.5
46.1
115.7
31.7
45.1
17.6
27.1
17.5
31.7
19.1
35.8
28.2
33.5
19.3
26.1
13.9
9.3
20.5
27.1
39.6
3.7
44.1
16.8
84.1
17.9
58.1
42.4
19.3
35.2
19.2
25.8
43.6
23.6
33.6
28.9
32.3
33.0
30.6
29.8
19.0
36.3
40.5
22.5
38.6
42.0
24.2
31.9
19.5
21.9
24.9
32.8
41.9
13.0
44.2
25.6
497.8
23.9
178.6
18.9
29.7
29.5
14.6
31.5
6.1
38.9
34.2
13.3
19.0
32.2
41.8
NM
NM
12.1
NM
87.8
NM
0.0
40.5
41.5
17.2
25.5
16.7
70.0
45.8
94.6
13.8
26.3
12.7
25.4
22.4
16.8
27.5
31.9
16.9
29.5
30.7
19.1
25.9
18.0
18.5
17.4
25.0
27.1
5.8
27.8
17.5
28.5
19.5
22.0
15.6
25.4
17.5
13.6
22.8
5.4
31.2
23.4
6.2
14.4
22.2
16.0
15.8
11.2
8.5
2,618
13.4
NM
14.6
28.6
30.1
13.2
21.2
12.1
60.0
39.4
78.6
11.4
19.1
11.1
4.9
6.8
4.3
7.0
5.9
2.2
12.0
8.0
3.9
4.1
6.1
3.6
2.4
6.3
7.6
1.6
10.2
4.5
2.2
2.3
2.5
1.5
4.9
1.9
1.0
4.8
0.6
4.8
3.3
0.9
3.1
3.3
0.9
0.5
0.5
0.9
0.5
1.0
0.4
0.8
4.3
5.7
3.9
5.9
5.3
2.0
9.0
6.7
3.3
3.7
5.4
3.2
2.1
5.4
6.3
1.3
7.9
3.8
2.0
2.1
2.3
1.4
3.8
1.8
0.9
4.2
0.5
4.4
3.0
0.8
2.6
2.8
17.3
24.3
23.9
20.9
15.2
10.3
35.2
20.8
18.3
12.9
33.8
14.6
10.4
18.5
19.2
13.5
25.3
17.5
0.5
10.9
1.4
8.3
17.9
6.7
6.8
16.5
9.1
10.9
11.6
6.9
17.7
10.2
18.0
27.6
24.6
23.3
17.5
12.5
34.9
23.8
18.7
14.4
32.1
14.8
13.1
21.4
25.4
24.0
32.0
21.5
7.4
11.1
10.7
9.0
16.9
10.8
6.9
19.6
9.9
12.0
13.3
13.7
19.9
12.7
Buy
Neutral
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
553
190
165
90
2011
311
44
1894
54
1265
518
26
350
600
198
185
127
2400
380
65
2150
100
1400
650
38
444
8
4
12
41
19
22
48
14
86
11
25
49
27
1.1
8.0
0.9
4.8
67.8
10.6
3.0
60.2
8.8
32.5
15.1
1.9
18.4
Buy
Neutral
Neutral
Buy
Buy
Buy
Neutral
143
100
246
318
89
251
88
185
112
280
371
160
362
97
30
12
14
17
80
44
10
3.4
-18.8
-2.4
26.2
-5.7
2.9
-56.5
8.9
6.3
21.9
37.3
0.0
18.7
-1.5
15.7 -43.1 161.5 75.6
12.1 Loss LP 91.8
61.3
PL
LP 179.6
45.6 -10.4 42.5 22.1
14.3
PL
LP 42,272
34.0 861.1 553.8 81.6
5.7
PL Loss LP
PL
LP 106.0
42.1
34.2
27.5
19.1
22.8
20.4
18.9
25.8
20.9
49.3
18.7
0.9 2.0 5.0
0.5 -7.7 3.0
0.5 -0.4 4.1
0.9 8.3 11.0
0.5 -3.0 0.0
0.9 -0.3 5.7
0.4 -23.8 -0.7
0.8 -1.2 5.2
Buy
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Neutral
152
1859
590
1590
625
694
1921
522
1242
178
501
215
2330
960
1930
765
600
2225
475
1650
240
610
42
25
63
21
22
-14
16
-9
33
35
22
3.8
5.3
7.5
NA 41.5
44.8 61.7 82.8 39.8 37.8
34.2 44.6 56.8 38.9 30.2
62.3 75.0 89.3 35.5 20.4
37.4 51.7 63.5 26.2 38.4
9.9 11.6 13.9 21.9 16.6
42.0 48.7 57.9 5.3 16.1
5.5
6.6
8.4 23.5 20.4
90.2 108.8 131.5 31.5 20.6
6.8
9.3
13.9 29.5 37.4
39.4 45.0 53.5 3.0 14.3
3.9 3.0 12.4 12.1
6.5 5.5 20.2 19.9
2.2 1.9 13.7 15.6
4.8 4.0 20.6 20.7
2.3 2.0 14.1 17.4
20.5 17.0 32.6 31.0
5.1 4.5 18.4 17.5
3.4 2.8 21.7 21.7
4.1 3.5 30.7 33.2
2.9 2.6 13.4 14.1
2.1 1.8 17.0 17.2
14 May 2018
24

Click excel icon
for detailed
valuation guide
CMP
(INR)
620
502
436
1297
585
2288
1486
TP % Upside
EPS (INR)
(INR) Downside FY18E FY19E FY20E
750
21
24.4 31.1 38.9
600
20
14.5 20.7 26.5
475
9
44.0 44.7 49.8
1750
35
49.9 65.7 87.3
740
26
32.9 39.0 46.0
2800
22
100.8 145.9 175.9
1950
31
69.1 118.2 141.5
Valuation snapshot
Company
MAS Financial
M&M Fin.
Muthoot Fin
PNB Housing
Repco Home
Shriram City Union
Shriram Trans.
Aggregate
Capital Goods
ABB
Bharat Elec.
BHEL
Blue Star
CG Cons. Elec.
CG Power & Indu.
Cummins
Engineers India
GE T&D
Havells
K E C Intl
L&T
Siemens
Solar Ind
Thermax
Va Tech Wab.
Voltas
Aggregate
Cement
Ambuja Cem.
ACC
Birla Corp.
Dalmia Bharat
Grasim Inds.
India Cem
JK Lakshmi Ce
Ramco Cem
Orient Cem
Prism Johnson
Sagar Cements
Sanghi Inds.
Shree Cem
Ultratech
Aggregate
Consumer
Asian Paints
Britannia
Colgate
Dabur
Emami
Future Consumer
Godrej Cons.
GSK Cons.
HUL
ITC
Jyothy Lab
Reco
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
EPS Gr. YoY (%)
P/E (x)
P/B (x)
ROE (%)
FY18E FY19E FY20E FY18E FY19E FY18E FY19E FY18E FY19E
62.2 27.5 25.2 25.4 19.9 3.8 3.3 21.3 17.8
104.9 42.9 27.9 34.6 24.2 3.3 3.0 10.5 13.1
48.9 1.6 11.4
9.9
9.8
2.2 1.9 24.5 20.9
57.7 31.8 32.9 26.0 19.7 3.5 3.1 14.3 16.5
13.0 18.5 18.1 17.8 15.0 2.8 2.4 16.7 16.9
19.5 44.8 20.6 22.7 15.7 2.8 2.4 12.7 16.3
24.7 71.0 19.8 21.5 12.6 2.7 2.3 13.1 19.5
26.9 27.3 24.5 31.7 24.9 4.6 3.9 14.5 15.8
17.7
7.6
19.4
26.9
18.4
58.8
18.6
19.8
14.2
24.1
28.3
20.0
18.8
23.7
23.9
9.8
13.9
18.9
31.9
31.0
19.2
41.3
14.2
41.8
40.5
27.6
62.2
32.7
39.7
32.5
35.1
41.3
29.4
63.1
19.6
25.6
47.3
45.9
68.8
33.7
24.4
37.6
49.1
24.8
28.6
52.4
43.6
41.7
14.4
34.2
31.7
36.0
31.0
98.1
53.8
23.1
47.3
68.2
34.8
58.0
46.6
37.7
21.7
41.8
48.2
39.8
61.0
65.1
46.2
47.2
43.4
NM
51.1
36.8
62.8
31.7
43.1
45.8
17.6
22.4
31.9
36.1
42.1
25.0
22.4
34.3
40.0
21.2
24.1
38.5
35.9
33.3
13.6
28.9
26.5
26.7
24.2
17.2
38.7
11.2
20.6
25.9
28.2
23.3
22.7
18.7
11.7
32.1
33.5
25.1
50.4
52.1
39.2
40.7
35.6
190.9
44.5
32.2
53.3
27.9
33.3
7.3 6.6 11.6 14.3
3.3 2.9 16.6 16.7
0.9 0.9 3.6 4.0
9.4 8.7 20.4 28.3
20.0 16.4 50.2 49.9
1.2 1.1 1.7 2.7
5.4 5.0 16.5 20.7
3.5 3.2 13.9 14.1
8.2 7.1 23.5 22.3
9.3 8.2 18.9 20.5
5.4 4.5 21.7 21.1
3.5 3.2 13.0 14.0
4.8 4.4 9.1 11.5
8.1 6.8 20.0 20.6
4.8 4.3 11.9 13.6
2.3 2.1 17.1 16.0
5.4 4.8 16.9 17.6
3.5 3.2 10.9 12.1
2.2
3.1
1.7
4.6
1.5
0.8
3.2
4.7
2.5
5.3
2.4
1.7
6.4
4.3
3.2
14.7
20.2
22.4
11.3
11.9
9.6
11.7
7.3
48.1
6.9
6.3
2.0
2.9
1.6
4.1
1.4
0.8
2.9
4.1
2.3
4.4
2.1
1.5
5.4
3.9
2.9
13.5
17.4
21.0
10.3
10.5
9.2
9.2
6.6
47.3
6.4
6.1
6.1
10.1
1.7
8.9
6.9
1.7
4.8
14.3
4.4
11.9
6.5
9.7
16.3
9.3
8.0
25.3
33.9
49.9
25.9
29.2
-1.8
24.9
20.7
78.2
22.8
14.3
7.8
12.4
9.6
11.3
12.9
3.9
11.7
15.6
10.3
21.2
12.0
15.6
18.2
12.2
11.5
27.9
35.8
55.5
26.5
31.3
4.9
23.2
21.6
89.6
23.8
18.5
Sell
Buy
Sell
Neutral
Buy
Neutral
Buy
Buy
Neutral
Buy
Neutral
Buy
Neutral
Neutral
Buy
Buy
Neutral
1250
128
81
785
234
79
775
154
388
547
401
1387
1036
1065
1169
480
616
1060
196
80
880
305
90
1040
200
430
630
385
1690
1185
1100
1350
700
660
-15
53
-1
12
31
15
34
30
11
15
-4
22
14
3
16
46
7
19.8
6.5
3.2
16.6
5.1
1.1
23.0
6.3
10.3
11.1
16.2
48.6
19.8
24.4
28.0
33.3
18.0
27.3
7.3
3.6
24.6
6.5
1.9
31.0
6.9
11.3
13.7
18.9
57.6
26.9
29.6
35.1
35.2
21.3
32.1 8.1 37.7
7.8
3.7 11.4
4.3 135.9 14.2
31.2 36.0 48.2
7.7
8.9 27.1
3.0 -72.2 63.3
36.8 -13.2 34.7
8.2 48.1 9.2
12.9 79.8 9.7
17.0 16.5 22.8
24.3 36.6 16.7
69.0 14.8 18.5
31.9 10.9 36.2
36.7 18.4 21.5
43.5 3.1 25.3
38.6 76.4 5.7
24.3 16.4 18.4
16.6 20.0
10.7
79.6
50.5
102.1
111.8
9.4
21.2
37.8
8.7
6.5
70.6
11.3
683.8
171.3
29.5
31.3
-74.0
34.0
-29.8
-48.5
-17.7
-11.9
LP
769.4
LP
59.3
1.1
-12.3
-6.9
34.9
28.1
470.3
39.1
105.6
129.3
163.8
23.4
148.6
105.1
101.0
86.0
30.3
43.8
58.5
Neutral
Neutral
Buy
Buy
Neutral
Neutral
Buy
Buy
Buy
Buy
Not Rated
Buy
Buy
Buy
217 255
1471 1747
728 1004
2798 3350
1100 1187
137 148
391 470
836 967
125 170
111 144
948
-
99 157
16256 19731
4063 4818
17
19
38
20
8
8
20
16
36
30
58
21
19
6.0
47.4
7.4
52.0
47.6
2.9
5.7
24.0
2.2
2.4
25.2
4.6
388.5
84.3
8.1
60.7
42.3
72.3
97.9
6.6
15.1
29.7
5.4
4.9
50.6
8.5
506.3
121.2
Neutral
Buy
Buy
Buy
Buy
Buy
Neutral
Neutral
Buy
Neutral
Neutral
1290
5480
1106
367
1053
58
1079
5919
1506
284
364
1280
6180
1420
435
1390
76
1155
6230
1530
275
405
-1
13
28
19
32
32
7
5
2
-3
11
21.1
84.2
24.0
7.8
24.3
-0.1
21.1
161.0
24.0
9.0
8.5
25.6 30.5 1.9 21.1 19.0
105.1 131.5 14.3 24.8 25.1
28.3 33.8 12.9 17.9 19.7
9.0
10.4 7.2 16.0 15.5
29.6 35.6 -8.5 21.9 20.4
0.3
1.1 Loss LP 276.5
24.3 28.1 11.7 14.9 15.9
183.8 215.7 3.1 14.1 17.4
28.3 33.3 22.1 17.9 17.8
10.2 11.4 6.6 13.7 12.4
10.9 13.6 -24.8 29.3 24.0
14 May 2018
25

Click excel icon
for detailed
valuation guide
CMP TP % Upside
EPS (INR)
Reco
(INR) (INR) Downside FY18E FY19E FY20E
Neutral
310 350
13
6.4
7.6
9.0
Neutral
9507 9535
0
140.0 189.3 209.0
Buy
24020 27490
14
297.1 415.7 549.8
Buy
1104 1115
1
17.6 20.6 23.7
Neutral
9200 9672
5
142.1 171.3 200.8
Not Rated 171
-
3.5
6.4
9.7
Buy
1112 1450
30
14.1 17.4 22.9
Neutral
3239 3510
8
32.6 56.9 78.5
Valuation snapshot
P/B (x)
ROE (%)
FY18E FY19E FY18E FY19E
15.8 13.7 34.0 35.8
26.8 23.8 40.3 50.2
32.2 25.8 39.9 44.6
14.1 12.3 24.2 24.5
36.4 30.5 61.2 61.8
2.4 2.2 4.9 8.5
11.1 9.6 14.9 16.2
17.1 12.7 17.2 22.3
13.1 11.8 26.8 28.7
4.1 3.5 22.5 19.8
4.7 4.1 16.4 19.5
4.6 3.9 26.0 20.4
3.0 2.5 24.2 21.7
7.3 6.7 7.2 11.5
4.9 4.1 21.6 22.8
3.3 2.9 12.4 13.3
5.8 5.2 16.0 20.0
2.6 2.3 9.0 13.9
1.2 1.2 1.2 2.2
2.8 2.4 16.4 15.3
1.7 1.6 13.2 13.9
12.4 15.4 19.7 27.2
3.4 3.0 10.5 13.0
3.3 2.7 18.9 21.5
3.4 2.8 14.1 18.3
2.4 2.2 10.1 12.1
5.6 5.1 16.1 16.8
3.6 3.0 11.0 17.4
1.7 1.5 4.6 12.1
3.0 2.8 8.5 13.2
4.7 4.2 17.6 19.9
3.5 3.1 12.2 14.6
2.8
1.5
3.9
3.4
2.3
1.6
3.7
1.8
3.1
2.6
1.3
3.3
3.0
2.0
1.5
3.4
1.6
2.9
2.2
14.6
23.6
13.5
12.4
10.8
9.4
6.6
9.1
6.9
14.1
16.2
13.7
12.4
13.7
13.4
10.7
12.7
Company
Marico
Nestle
Page Inds
Pidilite Ind.
P&G Hygiene
Prabhat Dairy
United Brew
United Spirits
Aggregate
Healthcare
Alembic Phar
Alkem Lab
Ajanta Pharma
Aurobindo
Biocon
Cadila
Cipla
Divis Lab
Dr Reddy’s
Fortis Health
Glenmark
Granules
GSK Pharma
IPCA Labs
Jubilant Life
Laurus Labs
Lupin
Sanofi India
Shilpa Medicare
Strides Shasun
Sun Pharma
Torrent Pharma
Aggregate
Infrastructure
Ashoka Buildcon
IRB Infra
KNR Constructions
Sadbhav Engineering
Aggregate
Logistics
Allcargo Logistics
Concor
Gateway Distriparks
Aggregate
Media
Dish TV
D B Corp
Den Net.
Ent.Network
Hathway Cable
Hind. Media
HT Media
Jagran Prak.
Music Broadcast
PVR
EPS Gr. YoY (%)
P/E (x)
FY18E FY19E FY20E FY18E FY19E
2.0 18.3 18.2 48.4 40.9
13.2 35.2 10.4 67.9 50.2
24.5 39.9 32.2 80.8 57.8
5.4 17.0 14.9 62.6 53.5
6.9 20.5 17.3 64.7 53.7
-2.0 83.8 52.1 49.1 26.7
62.0 23.9 31.2 79.0 63.8
22.1 74.3 38.1 99.2 56.9
10.0 19.0 17.0 48.7 40.9
19.1
22.4
20.5
12.5
58.5
19.6
21.9
27.2
17.4
53.8
15.7
11.8
56.6
24.7
13.8
16.8
18.7
30.5
18.9
13.0
21.9
22.2
21.4
38.7
9.9
22.1
23.3
16.4
11.3
26.4
15.8
22.5
Neutral
Buy
Buy
Buy
Neutral
Buy
Neutral
Neutral
Neutral
Buy
Neutral
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Neutral
488
2001
1059
609
631
393
574
1198
1991
148
516
94
2413
722
862
488
752
4942
460
532
472
1361
555
2500
1560
820
600
555
600
1100
2575
185
550
175
2500
750
1110
613
940
5600
686
989
675
1400
14
25
47
35
-5
41
5
-8
29
25
7
87
4
4
29
26
25
13
49
86
43
3
24.8
65.4
53.0
43.8
6.2
16.0
21.6
32.9
67.1
1.5
30.6
6.3
38.3
21.4
45.6
19.0
31.0
141.7
13.3
14.1
13.2
48.0
25.6 30.5 15.0 3.1 19.1 19.7
89.5 110.6 -12.4 36.9 23.6 30.6
51.6 65.0 -7.5 -2.6 25.9 20.0
48.7 53.6 11.4 11.2 10.1 13.9
10.8 19.8 -39.2 73.9 83.3 101.7
20.1 23.3 12.7 25.5 15.9 24.6
26.2 32.0 35.7 21.3 22.3 26.6
44.0 52.7 -17.7 33.9 19.7 36.5
114.1 146.1 -7.6 70.0 28.0 29.7
2.8
7.3 -85.8 87.8 164.5 101.1
32.9 41.1 -22.2 7.7 24.7 16.9
7.9
11.0 -12.4 25.2 38.7 14.8
42.6 48.5 11.5 11.2 13.7 62.9
29.2 37.3 33.2 36.6 27.7 33.7
62.6 72.5 23.3 37.3 15.9 18.9
29.1 35.7 7.0 52.7 22.8 25.6
40.2 54.1 -45.2 29.5 34.6 24.2
161.8 186.9 9.8 14.2 15.5 34.9
24.3 30.6 -5.0 82.4 25.9 34.6
40.8 55.7 -56.2 188.8 36.7 37.6
21.5 27.7 -49.6 63.3 28.8 35.8
61.3 78.5 -12.9 27.6 28.0 28.3
-19.9 34.6 25.6 28.9
7.0
26.0
14.0
16.0
8.3
26.5
18.2
17.4
LP 238.0 18.1
17.5 9.0
1.9
41.2 -17.3 30.2
27.1 14.9 8.6
130.8
10.8
18.3
26.8
18.4
15.7
40.1
26.9
34.0
Buy
Neutral
Buy
Buy
271
259
309
373
290
290
375
460
7
12
22
23
2.1
23.9
16.9
13.9
Buy
Buy
Buy
128 198
1408 1553
168 231
54
10
38
8.2
35.1
6.2
11.4
53.4
10.6
13.2
64.6
12.9
-16.5
12.5
-8.3
4.6
PL
-10.4
Loss
-37.2
Loss
-7.5
78.9
-5.3
29.9
29.9
38.6
52.1
69.8
50.8
LP
25.8
LP
113.8
LP
0.1
-20.8
30.5
62.3
42.4
16.3
21.0
21.8
20.3
109.9
20.1
5,545
86.9
161.9
10.2
10.4
21.5
31.4
34.7
Buy
Buy
Neutral
Buy
Buy
Neutral
Neutral
Buy
Buy
Buy
72
277
102
673
32
218
83
166
367
1414
101
420
90
820
47
237
92
215
469
1760
40
52
-12
22
47
9
11
29
28
24
-0.3
18.3
-2.9
7.2
-0.2
23.9
13.2
10.1
8.3
26.7
1.6
23.0
0.1
15.3
0.8
23.9
10.5
13.1
13.5
38.0
3.4
27.6
4.0
28.7
2.0
26.3
11.5
16.0
17.8
51.2
NM
44.9 17.2 12.4 -7.8 32.1
15.2 12.1 2.8 2.3 19.6 21.0
NM 1,440.0 2.3 2.3 -6.3 0.2
93.9 43.9 3.6 3.4 3.9 7.9
NM
42.2 2.3 2.1 -1.2 5.2
9.1
9.1
1.2 1.1 14.0 12.4
6.2
7.9
0.8 0.7 12.8 9.1
16.5 12.7 2.6 2.3 14.9 18.5
44.0 27.1 3.5 3.1 8.3 12.2
53.0 37.2 6.1 5.3 12.2 15.3
14 May 2018
26

Click excel icon
for detailed
valuation guide
CMP
(INR)
89
17
865
593
TP % Upside
EPS (INR)
(INR) Downside FY18E FY19E FY20E
130
46
2.5
5.8
7.9
27
63
-0.9
0.1
0.6
1225
42
27.7 35.8 42.5
690
16
14.5 16.5 19.7
Valuation snapshot
Company
Prime Focus
Siti Net.
Sun TV
Zee Ent.
Aggregate
Metals
Hindalco
Hind. Zinc
JSPL
JSW Steel
Nalco
NMDC
SAIL
Rain Industries
Vedanta
Tata Steel
Aggregate
Oil & Gas
Aegis Logistics
BPCL
GAIL
Gujarat Gas
Gujarat St. Pet.
HPCL
IOC
IGL
Mahanagar Gas
MRPL
Oil India
ONGC
PLNG
Reliance Ind.
Aggregate
Retail
Jubilant Food
PC Jeweller
Titan Co.
Aggregate
Technology
Cyient
HCL Tech.
Hexaware
Infosys
KPIT Tech
L&T Infotech
Mindtree
Mphasis
NIIT Tech
Persistent Sys
Tata Elxsi
TCS
Tech Mah
Wipro
Zensar Tech
Aggregate
Reco
Buy
Neutral
Buy
Buy
EPS Gr. YoY (%)
P/E (x)
P/B (x)
ROE (%)
FY18E FY19E FY20E FY18E FY19E FY18E FY19E FY18E FY19E
100.6 137.5 36.4 36.4 15.3 3.7 2.4 11.6 18.9
Loss LP 411.6 NM 131.4 3.2 3.1 -15.8 2.4
11.6 29.1 18.7 31.2 24.1 7.8 7.1 26.1 30.9
8.4 14.1 19.0 40.9 35.8 7.5 6.5 19.6 19.4
15.7 34.7 28.6 35.7 26.5 5.2 4.5 14.5 17.1
12.7
14.2
NM
15.0
17.9
8.5
NM
10.7
13.5
10.4
14.0
44.4
10.0
16.3
39.1
14.2
8.0
8.2
28.4
15.6
9.1
12.8
11.2
15.4
16.2
11.6
83.3
13.0
75.9
57.7
23.0
14.9
26.6
18.2
20.7
24.4
29.3
22.4
23.2
19.9
30.6
26.2
16.7
14.4
23.4
20.6
9.3
11.2
40.0
13.5
7.8
8.3
17.0
6.8
10.1
8.7
10.3
29.2
9.7
15.0
24.3
13.6
9.8
9.6
24.1
16.2
9.3
8.7
8.6
13.4
14.1
10.5
59.9
10.3
57.6
44.1
20.9
13.9
23.3
16.8
19.2
22.1
23.2
18.0
19.0
17.1
26.3
23.0
15.7
14.2
18.5
19.6
1.6
3.5
0.8
2.9
1.5
1.5
0.8
2.3
1.8
1.5
1.6
12.2
2.3
1.9
6.1
2.0
2.2
1.5
5.5
4.1
1.6
0.9
1.1
3.4
2.0
1.5
1.4
2.9
0.8
2.4
1.3
1.4
0.8
1.8
1.7
1.3
1.5
9.2
2.0
1.7
5.1
1.8
1.9
1.3
4.6
3.8
1.4
0.9
1.0
2.8
1.7
1.4
13.7
26.7
-2.7
20.9
8.4
18.2
-1.0
24.7
13.3
16.0
11.6
30.7
24.1
11.9
16.8
15.0
28.2
18.5
20.7
28.0
18.9
7.4
9.6
23.7
13.0
13.2
16.3
28.6
2.1
19.4
18.3
17.2
4.8
29.8
17.1
16.2
14.2
35.9
21.6
12.0
23.0
14.0
20.6
14.4
20.8
24.4
16.1
10.5
12.0
22.9
13.2
13.1
Buy
Neutral
Buy
Buy
Buy
Buy
Sell
Buy
Buy
Neutral
242
299
256
324
78
116
73
275
287
607
370
336
349
334
120
215
71
480
345
778
53
12
37
3
54
85
-3
75
20
28
19.0
21.1
-8.5
21.5
4.3
13.6
-0.9
25.6
21.3
58.2
26.1
26.8
6.4
24.0
9.9
14.0
4.3
40.6
28.3
69.4
29.2 122.3 37.0 12.0
30.6 7.2 26.8 14.2
10.4 Loss LP 62.3
23.7 45.3 11.5 -1.0
10.2 16.8 128.2 3.2
14.7 37.0 2.9
4.7
6.5 Loss LP 50.2
44.6 165.9 58.6 9.8
35.3 40.7 33.0 24.7
61.4 53.4 19.1 -11.5
67.4 36.2 10.7
12.3
46.5
24.6
44.3
13.9
37.8
21.7
12.5
54.6
12.4
28.1
23.5
18.8
74.9
74.2
-17.3
23.9
34.3
43.8
-2.9
-1.2
6.9
27.0
-20.7
-18.3
2.3
23.0
20.7
5.5
52.1
2.9
8.8
61.1
4.9
-17.8
-15.0
17.7
-3.6
-2.5
48.1
29.6
14.3
15.0
9.7
28.5
13.0
7.7
27.5
4.5
16.5
23.1
13.2
1.2
8.3
3.3
8.2
17.9
6.8
10.7
31.4
27.6
25.9
27.0
11.8
8.0
11.0
10.8
29.2
17.9
23.9
9.6
19.4
21.7
18.6
10.9
16.4
13.0
27.2
10.9
Buy
Buy
Sell
Buy
Neutral
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
279 303
399 554
343 285
843 1195
180 191
318 536
169 261
267 416
870 1228
106 119
235 260
187 222
215 317
989 1150
9
39
-17
42
6
69
54
56
41
12
11
19
48
16
6.3
40.0
21.0
21.6
12.7
39.5
20.7
9.4
55.9
11.7
18.3
16.8
14.0
60.9
9.5
41.2
22.9
34.7
13.3
32.5
17.6
11.1
53.9
11.4
27.2
21.8
16.0
70.1
Neutral
Buy
Buy
2477 2450
201 520
956 1150
-1
159
20
29.7
15.4
12.6
41.4
19.5
16.6
54.4 180.6 39.1
24.9 44.4 26.6
20.9 39.5 31.7
48.8 30.8
16.9 14.6 20.3 24.3
2.1 1.8 16.9 18.4
16.7 14.9 23.9 27.4
11.2 9.8 19.4 22.3
4.2
3.6
6.7
4.1
2.9
7.0
6.0
3.5
3.7
3.2
10.2
8.0
3.4
2.5
3.4
5.1
3.8
3.2
5.7
3.7
2.5
5.7
5.2
3.2
3.3
3.0
8.1
7.0
2.9
2.2
3.0
4.5
18.1
25.0
26.9
24.1
14.9
32.4
18.8
14.6
16.2
16.7
37.6
30.3
20.9
17.0
15.3
24.6
18.1
24.0
26.4
22.9
14.0
28.4
24.3
18.3
18.2
18.7
34.3
32.5
20.1
16.4
17.1
23.2
Neutral
Neutral
Sell
Buy
Neutral
Buy
Buy
Neutral
Neutral
Buy
Buy
Neutral
Buy
Neutral
Buy
880
932
442
1181
259
1618
1008
985
1056
802
1184
3461
666
272
1237
800
1050
390
1330
250
1400
1000
960
1100
860
1400
3000
700
300
1400
-9
13
-12
13
-4
-13
-1
-3
4
7
18
-13
5
10
13
38.2
62.6
16.6
64.8
12.5
66.3
34.4
44.0
45.6
40.4
38.7
132.1
39.8
18.9
52.8
42.2 47.1 24.8 10.3
66.9 72.2 4.5 6.9
18.9 21.0 21.2 14.2
70.1 77.7 3.1 8.3
13.5 17.5 5.1 7.8
73.3 86.3 19.5 10.5
43.5 53.9 38.0 26.7
54.6 59.8 13.2 23.9
55.7 66.6 19.8 22.3
47.0 57.2 7.2 16.4
45.0 53.4 37.7 16.2
150.5 166.9 -1.0 13.9
42.3 49.3 28.8 6.4
19.2 21.7 11.8 1.3
67.0 85.2 1.3 27.0
4.9 5.6
14 May 2018
27

Click excel icon
for detailed
valuation guide
Valuation snapshot
Company
Telecom
Bharti Airtel
Bharti Infratel
Idea Cellular
Tata Comm
Aggregate
Utiltites
Coal India
CESC
JSW Energy
NHPC
NTPC
Power Grid
Tata Power
Aggregate
Others
Arvind
Avenue Supermarts
BSE
Castrol India
Coromandel Intl
Delta Corp
Interglobe
Indo Count
Info Edge
Kaveri Seed
Manpasand
MCX
Navneet Education
Oberoi Realty
Phoenix Mills
Quess Corp
PI Inds.
Piramal Enterp.
SRF
S H Kelkar
Tata Chemicals
Team Lease Serv.
Trident
TTK Prestige
UPL
V-Guard
Reco
Buy
Neutral
Buy
Buy
CMP TP % Upside
EPS (INR)
EPS Gr. YoY (%)
P/E (x)
P/B (x)
ROE (%)
(INR) (INR) Downside FY18E FY19E FY20E FY18E FY19E FY20E FY18E FY19E FY18E FY19E FY18E FY19E
386
321
51
636
581
346
85
750
51
8
65
18
4.1
13.6
-9.6
3.5
1.9
13.7
-12.3
3.9
5.6 -63.3 -53.8 197.1 94.6
14.2 -8.1 0.4
3.6
23.5
-10.5 Loss Loss Loss
NM
14.6 -67.2 13.6 270.7 183.6
-98.8 PL
LP 3,189.4
16.5
9.5
16.1
7.0
9.3
6.0
22.7
11.1
36.5
32.0
20.9
4.0
18.4
41.4
34.1
16.6
27.1
17.0
34.6
16.6
17.6
-3.4
30.9
26.6
16.2
27.1
31.7
26.6
14.3
47.9
18.7
15.4
19.2
12.1
15.2
12.4
23.2
11.3
12.9
12.2
15.2
13.5
35.1
112.6
18.8
25.5
19.8
40.1
19.9
12.8
53.0
14.5
45.8
36.0
18.5
39.1
38.6
52.4
29.1
29.3
29.0
31.6
23.0
65.7
11.9
44.2
16.6
53.5
205.0 2.2 2.2 2.4 1.1
23.4 3.5 3.6 15.6 15.2
NM
0.8 1.0 -16.0 -21.9
161.5 14.4 13.2 6.9 8.5
-133 2.3 2.4 0.1 -1.8
10.2
10.4
16.8
9.3
11.0
10.0
12.8
10.4
28.9
85.4
17.3
26.2
19.1
32.2
16.5
11.0
47.1
12.2
28.9
26.4
14.5
10.5
30.1
35.0
22.8
21.0
21.4
25.8
17.6
47.8
8.9
34.6
15.7
40.3
7.2
1.2
1.0
1.0
1.3
1.9
1.4
2.0
6.7
1.1
1.0
0.9
1.2
1.7
1.1
1.8
47.4
10.3
4.6
8.6
10.6
16.6
10.7
14.7
65.8
11.1
6.1
10.3
11.6
17.7
9.7
17.5
Buy
Buy
Sell
Buy
Buy
Buy
Sell
271
1059
70
28
168
207
81
397
1440
61
36
214
287
77
47
36
-13
30
28
39
-5
17.8 26.4 30.8 19.2 48.4
85.6 102.0 111.7 65.0 19.2
3.0
4.2
4.8 -21.2 37.9
2.4
3.0
3.2 -17.2 22.2
13.0 15.2 16.6 5.0 16.9
16.9 20.7 21.9 21.3 22.1
5.3
6.3
7.8
3.5 18.7
11.7 29.0
12.2
12.9
43.5
7.0
22.7
5.8
58.3
6.3
23.4
34.2
8.8
21.2
7.7
13.5
15.8
22.8
29.9
83.1
77.4
7.9
33.7
43.3
5.3
137.8
44.2
4.5
14.8 20.3 -1.4 21.6
17.0 22.5 68.4 31.9
47.4 57.2 6.0 9.0
6.8
7.1
2.9 -2.8
23.5 27.9 38.8 3.7
7.2
10.2 89.8 24.5
70.2 94.1 35.1 20.4
7.4
8.7 -46.0 17.1
26.3 33.4 49.0 12.5
40.6 47.4 79.5 18.5
13.9 18.7 38.2 58.4
28.9 33.7 -14.6 36.5
9.8
11.5 4.7 27.4
50.3 48.6 21.4 271.7
20.3 26.6 44.2 28.4
34.1 43.1 130.7 49.6
38.1 44.2 -10.5 27.3
116.4 147.9 14.5 40.0
105.0 138.3 -9.9 35.6
9.7
12.2 9.1 22.4
44.0 50.3 0.0 30.5
59.6 88.1 11.6 37.5
7.0
8.3 -21.8 32.7
176.1 203.2 4.4 27.8
46.7 55.6 5.9 5.6
6.0
6.7 25.3 32.9
Neutral
Sell
Buy
Buy
Buy
Buy
Neutral
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Neutral
Buy
Neutral
429
1455
818
178
450
233
1161
81
1239
496
402
764
142
529
611
1193
869
2439
2248
250
776
2846
63
6089
735
240
460
900
1000
248
557
327
1318
95
1550
664
467
1050
195
654
737
1300
1061
3500
2351
318
940
2700
83
5281
945
167
7
-38
22
39
24
41
14
17
25
34
16
37
38
24
21
9
22
44
5
27
21
-5
32
-13
29
-30
2.9 2.7 8.6 9.8
19.4 16.8 18.9 21.1
1.4 1.2 7.6 6.8
17.3 16.2 69.1 63.8
4.2 3.7 22.1 20.6
3.9 3.6 12.3 11.5
6.3 5.9 41.3 37.0
1.7 1.4 13.9 14.1
7.0 6.3 13.7 14.0
3.6 3.1 23.4 27.1
3.7 3.4 7.2 12.3
2.8 2.7 7.9 10.4
4.2 3.6 24.2 26.9
2.9 2.4 7.8 25.1
3.3 2.6 9.6 9.6
6.6 5.3 22.3 21.7
6.1 5.1 23.0 24.3
2.2 2.0 8.9 10.2
3.7 3.3 13.3 16.3
4.1 3.7 13.4 14.9
2.1 2.0 11.3 11.5
10.7 8.7 17.7 20.1
1.1 1.0 9.2 11.4
7.6 6.8 18.0 20.7
4.0 3.4 26.9 23.3
13.1 10.4 26.9 28.8
14 May 2018
28

MOSL Universe stock performance
Company
Automobiles
Amara Raja
Ashok Ley.
Bajaj Auto
Bharat Forge
Bosch
CEAT
Eicher Mot.
Endurance Tech.
Escorts
Exide Ind
Hero Moto
M&M
Mahindra CIE
Maruti Suzuki
Motherson Sumi
Tata Motors
TVS Motor
Banks - Private
Axis Bank
DCB Bank
Equitas Hold.
Federal Bank
HDFC Bank
ICICI Bank
IDFC Bank
IndusInd
J&K Bank
Kotak Mah. Bk
RBL Bank
South Indian
Yes Bank
Banks - PSU
BOB
BOI
Canara
Indian Bk
PNB
SBI
Union Bk
NBFCs
Aditya Birla Cap
Bajaj Fin.
Capital First
Cholaman.Inv.&Fn
Dewan Hsg.
GRUH Fin.
HDFC
HDFC Stand. Life
Indiabulls Hsg
L&T Fin.Holdings
LIC Hsg Fin
M&M Fin.
Muthoot Fin
1 Day (%)
-0.7
0.7
-0.4
0.3
-0.4
0.5
0.6
0.5
-0.3
0.8
-0.7
1.5
1.2
0.4
1.1
-0.8
1.1
1.0
-1.1
1.3
0.7
1.1
1.3
0.2
0.4
0.8
1.5
-0.2
-1.0
1.5
2.7
0.0
-0.9
1.3
-2.9
1.2
0.7
-1.9
1.4
0.5
0.6
0.2
0.7
1.3
1.1
2.7
-0.3
0.3
0.6
0.5
1M (%)
5.8
11.7
2.2
-0.8
-6.5
-10.0
0.6
-11.8
4.4
8.5
-3.0
10.5
9.4
-6.0
-1.2
-6.9
-0.9
2.5
7.0
6.6
-9.2
4.9
9.5
-11.0
2.0
-7.6
12.4
2.8
-0.2
12.2
-5.4
-11.0
-12.2
-0.3
-13.1
-2.5
-12.7
-5.8
-3.4
-9.7
2.3
17.9
14.0
5.9
4.7
-5.3
5.5
-10.3
1.1
0.3
12M (%)
-6.3
87.5
-6.1
28.4
-20.6
-13.2
5.0
47.1
46.4
5.6
4.4
26.6
-1.3
29.2
26.6
-22.6
25.1
7.0
-2.4
0.1
-22.4
30.0
13.9
-32.7
32.8
-35.0
35.1
-7.7
-1.9
10.8
-24.2
-45.3
-33.6
-10.6
-48.5
-15.8
-50.5
Company
MAS Financial Serv.
PNB Housing
Repco Home
Shriram City Union
Shriram Trans.
Capital Goods
ABB
Bharat Elec.
BHEL
Blue Star
CG Cons. Elec.
CG Power & Inds Sol.
Cummins
Engineers India
GE T&D
Havells
K E C Intl
L&T
Siemens
Solar Ind
Thermax
Va Tech Wab.
Voltas
Cement
Ambuja Cem.
ACC
Birla Corp.
Dalmia Bharat
Grasim Inds.
India Cem
JK Lakshmi Ce
Ramco Cem
Orient Cem
Prism Johnson
Sagar Cements
Sanghi Inds.
Shree Cem
Ultratech
Consumer
Asian Paints
Britannia
Colgate
Dabur
Emami
Future Consumer
Godrej Cons.
GSK Cons.
HUL
ITC
Jyothy Lab
Marico
Nestle
Page Inds
Pidilite Ind.
1 Day (%)
0.3
-0.7
-0.4
-2.1
-1.0
-1.2
-1.5
0.3
0.8
-1.5
-1.3
0.0
-0.1
1.9
1.5
0.5
1.7
-0.6
-0.1
3.8
-1.6
2.4
-1.4
-1.6
-0.8
1.4
0.9
2.6
-0.8
2.6
1.9
-1.9
-2.6
-2.1
0.9
1.7
6.2
1.8
0.9
-0.3
1.0
-2.6
0.0
0.8
0.8
1.4
-1.5
-1.6
5.8
1.1
1.7
1M (%)
0.8
-3.0
-5.0
0.4
-5.1
-2.0
-11.7
-10.6
-1.3
-0.6
-3.7
1.8
-3.8
3.2
2.9
-2.8
2.6
-6.4
-0.7
3.0
-3.5
-2.7
-8.4
-4.2
-5.6
0.5
2.8
-7.7
-9.9
3.7
-14.0
-5.1
0.6
-17.5
-3.8
3.6
11.6
6.7
0.8
6.6
-6.7
-2.0
0.2
-1.4
6.9
7.2
-3.7
-3.5
12.2
-3.6
12.1
12M (%)
-0.7
-22.6
5.6
46.0
-18.3
-22.8
-30.5
16.1
-2.3
-14.8
-26.1
-7.5
5.5
6.4
69.2
19.8
-26.3
33.5
12.9
-27.9
40.2
-16.4
-13.1
-5.9
10.9
13.8
-35.7
-22.1
16.5
-24.2
-9.0
14.9
20.6
-18.4
-7.7
10.4
48.2
9.8
31.7
-6.8
75.6
13.0
12.7
54.0
2.6
-3.2
-0.5
38.7
62.7
46.3
38.9
-23.4
45.1
41.5
64.5
23.0
16.2
33.5
-27.5
48.6
10.5
14 May 2018
29

MOSL Universe stock performance
Company
P&G Hygiene
Prabhat Dairy
United Brew
United Spirits
Healthcare
Alembic Phar
Alkem Lab
Ajanta Pharma
Aurobindo
Biocon
Cadila
Cipla
Divis Lab
Dr Reddy’s
Fortis Health
Glenmark
Granules
GSK Pharma
IPCA Labs
Jubilant Life
Lupin
Laurus Labs
Sanofi India
Shilpa Medicare
Strides Shasun
Sun Pharma
Torrent Pharma
Infrastructure
Ashoka Buildcon
IRB Infra.Devl.
KNR Construct.
Sadbhav Engg.
Logistics
Allcargo Logistics
Concor
Gateway Distriparks
Media
Dish TV
D B Corp
Den Net.
Ent.Network
Hathway Cab.
Hind. Media
HT Media
Jagran Prak.
Music Broadcast
PVR
Prime Focus
Siti Net.
Sun TV
Zee Ent.
Metals
Hindalco
Hind. Zinc
JSPL
1 Day (%)
-5.5
0.3
1.1
-0.3
-1.7
-1.1
-3.8
2.6
1.2
-1.1
-0.3
0.7
0.1
-2.7
0.0
-2.4
0.8
-0.6
1.7
-0.6
-0.4
1.3
0.1
0.9
-5.1
1.1
-0.3
0.2
-0.4
0.4
-3.1
3.7
-1.4
-1.1
-0.7
6.4
1.5
-1.5
3.1
-0.6
-0.1
3.5
1.0
-0.5
-1.8
1.1
0.7
0.5
0.9
4.6
1M (%)
-4.9
-5.3
9.1
-6.4
-8.5
12.9
-23.0
-1.3
2.9
0.9
2.3
6.6
-5.2
0.5
-7.6
-13.9
4.9
4.1
5.3
-4.8
-3.0
-3.0
-4.6
-17.2
-9.4
2.7
0.4
-7.7
1.0
-6.2
-17.2
10.2
-8.4
-2.5
-12.9
-3.4
-4.3
-15.3
-2.0
-1.2
-2.8
-6.2
8.4
-2.0
3.1
-1.2
3.0
3.5
-6.1
3.2
12M (%)
18.1
41.9
30.9
51.7
-19.8
4.3
-33.3
-2.3
89.3
-20.1
2.3
88.7
-23.2
-28.7
-42.9
-35.8
-0.9
29.0
10.4
-40.3
-11.6
17.3
-33.7
-48.8
-27.2
3.2
27.5
-0.9
50.9
9.1
-30.9
20.2
-32.8
-24.9
-25.8
0.6
-15.2
-20.0
-22.5
-1.3
-13.8
7.5
-7.9
-21.7
-48.0
-4.9
8.7
25.3
15.4
123.4
Company
JSW Steel
Nalco
NMDC
Rain Industries
SAIL
Vedanta
Tata Steel
Oil & Gas
Aegis Logistics
BPCL
GAIL
Gujarat Gas
Gujarat St. Pet.
HPCL
IOC
IGL
Mahanagar Gas
MRPL
Oil India
ONGC
PLNG
Reliance Ind.
Retail
Jubilant Food
PC Jeweller
Titan Co.
Technology
Cyient
HCL Tech.
Hexaware
Infosys
KPIT Tech
L&T Infotech
Mindtree
Mphasis
NIIT Tech
Persistent Sys
Tata Elxsi
TCS
Tech Mah
Wipro
Zensar Tech
Telecom
Bharti Airtel
Bharti Infratel
Idea Cellular
Tata Comm
Utiltites
Coal India
CESC
JSW Energy
NHPC Ltd
NTPC
Power Grid
Tata Power
1 Day (%)
1.3
1.2
-0.2
-16.2
1.2
2.5
2.2
-2.1
2.3
0.8
0.6
-0.2
3.4
0.8
1.7
0.8
0.8
2.1
-0.5
2.1
0.8
0.1
-3.8
-1.7
2.6
0.2
5.9
1.2
0.5
2.4
-0.9
-1.3
1.7
3.3
0.6
0.2
0.3
0.8
3.4
-6.4
-0.3
-11.8
3.9
0.6
0.0
0.7
-0.7
-0.4
-0.4
-0.4
1M (%)
3.6
3.9
-4.4
-25.8
-4.5
-3.3
-0.2
-1.2
-4.3
4.9
-3.2
-3.9
-5.7
1.0
-9.5
-5.1
-3.8
6.7
3.1
-8.9
6.4
-0.4
-34.8
-2.3
39.1
-3.7
8.1
5.1
16.6
15.8
21.6
9.0
18.6
20.8
13.3
14.8
5.3
-4.9
30.4
0.3
-5.0
-30.4
-3.6
-4.2
4.2
-13.2
-2.0
-0.5
5.2
-6.1
12M (%)
66.0
15.9
-7.0
159.0
20.4
21.6
46.2
43.8
-17.8
11.8
8.7
1.5
-9.4
-21.7
31.5
-13.1
-20.0
10.9
1.7
-1.7
45.7
149.8
-9.1
90.7
65.1
11.1
76.0
25.1
101.6
116.7
99.2
71.0
106.9
37.7
54.3
47.2
53.3
7.7
38.9
5.4
-15.3
-43.3
-4.2
-1.6
7.6
2.9
-10.8
4.7
-0.4
-1.2
14 May 2018
30

MOSL Universe stock performance
Company
Others
Arvind
Avenue Super.
BSE
Castrol India
Coromandel Intl
Delta Corp
Interglobe
Indo Count
Info Edge
Kaveri Seed
Manpasand
MCX
Navneet Educat.
Oberoi Realty
Phoenix Mills
PI Inds.
Piramal Enterp.
Quess Corp
SRF
S H Kelkar
Tata Chemicals
Team Lease Serv.
Trident
UPL
V-Guard
1 Day (%)
0.0
-0.2
-0.2
0.4
-0.2
-0.2
1.3
-2.9
1.1
0.8
-0.7
-0.2
-2.1
-0.4
0.5
-0.1
-0.3
-1.7
0.5
0.7
1.2
-4.9
-0.9
1.7
1.1
1M (%)
4.8
-1.2
0.4
-13.6
-15.1
-17.3
-21.5
-15.5
1.3
-8.0
-0.2
3.7
-7.6
2.2
3.9
1.0
-6.2
13.9
9.2
-1.7
8.2
27.8
-14.2
-1.4
2.7
12M (%)
5.2
90.8
-18.2
-18.9
10.7
34.2
6.5
-60.1
47.0
-9.6
15.3
-31.9
-13.9
29.3
48.3
1.2
-3.3
39.5
26.4
-20.8
21.8
157.6
-28.7
-10.9
14.7
14 May 2018
31

NOTES
14 May 2018
32

THEMATIC/STRATEGY RESEARCH GALLERY

REPORT GALLERY
RECENT INITIATING COVERAGE REPORTS
.
Rs

DIFFERENTIATED PRODUCT GALLERY

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
*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.
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Companies where there is interest
No
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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.:022-38281085.
Registration details of group entities.: MOSL: SEBI Registration: INZ000158836 (BSE/NSE/MCX/NCDEX); CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser:
INA000007100.IRDA Corporate Agent-CA0541. 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
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