24 January 2018
Market snapshot
Equities - India
Close
Chg .%
Sensex
36,140
1.0
Nifty-50
11,084
1.1
Nifty-M 100
21,732
1.0
Equities-Global
Close
Chg .%
S&P 500
2,839
0.2
Nasdaq
7,460
0.7
FTSE 100
7,732
0.2
DAX
13,560
0.7
Hang Seng
13,490
2.2
Nikkei 225
24,124
1.3
Commodities
Close
Chg .%
Brent (US$/Bbl)
70
0.8
Gold ($/OZ)
1,341
0.6
Cu (US$/MT)
6,883
-2.0
Almn (US$/MT)
2,225
-0.9
Currency
Close
Chg .%
USD/INR
63.8
-0.1
USD/EUR
1.2
0.3
USD/JPY
110.3
-0.5
YIELD (%)
Close
1MChg
10 Yrs G-Sec
7.3
-0.01
10 Yrs AAA Corp
7.9
-0.01
Flows (USD b)
23-Jan
MTD
FIIs
0.2
1.4
DIIs
0.0
0.1
Volumes (INRb)
23-Jan
MTD*
Cash
493
420
F&O
9,989
7,101
Note: YTD is calendar year, *Avg
CY17%
34.4
34.0
49.9
CY17%
26.5
37.6
8.0
17.3
40.6
24.6
CY17%
24.6
15.7
27.2
31.8
CY17%
-6.0
16.6
-5.2
CY17%
0.7
0.4
CY17
7.7
14.0
YTD*
420
7,101
Today’s top research theme
Budget Preview 2018-19: Union Budget Expectations—What’s in
whose kitty?
Question is rife whether the budget will be populist
The government is set to present the Union Budget on 1st February 2018.
Expectations and excitement run high as it will be the first post-GST and last full-year
budget before the General Elections in 2019. In this note we discuss four key themes.
First, we believe that the fiscal deficit target of 3% will be postponed. We expect
the target to be revised to 3.4% for FY18 (FY18BE: 3.2%) and to 3.2% for FY19 (v/s
3% target set last year).
Second, capital spending will be budgeted to grow ~10% in FY19, following ~7% in
FY18.
Third, while rural spending may be revised upward for FY18, limited financial
resources will make it difficult to announce a targeted scheme for the poor.
Fourth, the government is expected to reduce the corporate tax rate by lowering
tax for companies with turnover of up to INR25b. This could cost ~INR100b. Apart
from this, we do not expect any further direct/indirect tax relief.
Research covered
Cos/Sector
Key Highlights
Budget Preview 2018-19 Union Budget Expectations—What’s in whose kitty?
3QFY18 interim earnings review: Headline numbers in-line; Technology
India Strategy
surprises positively; signs of consumption recovery evident
Indiabulls Housing
Continued strong growth
United Spirits
RBL Bank
GRUH Finance
PNB Housing
Dewan Hsg. Fin.
Crompton Gr. Con
Mahindra CIE
Results Expectation
Volumes disappoint; gross margins expand 530bp YoY
Strong operating performance; asset quality blip from one-off slippage
Steady quarter
Positive surprise on growth, asset quality stable
Strong growth, stable cost ratios; re-rating to continue
Sales marginally below estimates, PAT in-line
Ahead of the curve in identifying EV prospects
BIOS | CBK | CAFL | CCRI | IDEA | INDIGO | KPIT | LTI | MMFS | MPHL |
RADIOCIT | PIDI | QUESS | SITINET
Chart of the Day: Budget Preview 2018-19: Union Budget Expectations—What’s in whose
kitty?
Motilal Oswal’s expectations on key fiscal indicators from
Union Budget 2018-19
Economic
indicators
Gross fiscal
deficit
Gross market
borrowings
Net market
borrowings
Nominal GDP
Unit
INR b
% of GDP
INR b
% of GDP
INR b
% of GDP
INR b
% YoY
FY16
FY17 FY18BE
FY18F
FY19F
5,328
5,261
5,465
5,601
5,861
3.9
3.5
3.2
3.4
3.2
6,233
6,225
5,820
6,250
7,000
4.6
4.1
3.5
3.7
3.8
4,416
4,067
3,502
3,932
4,920
3.2
2.7
2.1
2.4
2.6
136,820 151,837 168,475 167,067 186,062
9.9
11.0
11.8
10.0
11.4
How do various expectations rank in terms of probability and
popularity?
By Popularity, we imply its potential impact on the stock markets
Source: MoSL
Research
Team (Gautam.Duggad@MotilalOswal.com)
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

In the news today
Kindly click on textbox for the detailed news link
1
A makeover on the cards for
DLF?
DLF Ltd, India’s largest real estate
developer, has adopted a multi-
pronged approach to its financial
and operational issues, having
recently concluded a game-
changing deal with Singapore’s
sovereign wealth fund GIC Pte.
Ltd. Besides looking to reduce its
debt and fixing its balance sheet,…
2
ArcelorMittal opts out of Bhushan Power & Steel race
ArcelorMittal, the world's largest steel producer, has withdrawn from
bidding for bankrupt Bhushan Power & Steel after it conducted due
diligence on the Indian company. ArcelorMittal informed the Bhushan
Power & Steel committee of creditors of its decision through a letter sent
by its financial advisor Goldman Sachs, according to people with
knowledge of the matter. Tata Steel, JSW, Vedanta, AION Capital and a
Dubai-based billionaire whose identity could not be ascertained remain in
the fray for the bankrupt company ahead of the January 29 deadline for
final offers.
3
Maruti, Hyundai dominate 10
best selling PV models in
December
Maruti Suzuki India's hold on
domestic passenger vehicles (PV)
market continued in December
with six of its models appearing in
the top 10 selling list and its
premium hatchback Baleno
moving up to the third spot. Rival
Hyundai Motor India also made its
presence felt with three of its
models featuring in the top ten…
4
Novelis plans to build $300-mn
aluminum factory in the U.S.
Aditya Birla Group firm Novelis
Inc. plans to build a $300-million
automotive aluminum sheet
manufacturing facility in Guthrie,
Kentucky. The greenfield facility,
with an annual nameplate
capacity of 200,000 metric tonnes,
will include heat treatment and
pre-treatment lines, which
prepare aluminum for use in
vehicle parts such as...
5
Wheat output likely to be
lower by 2% to 96.1mt in
2017-18, says report
India is likely to produce 96.1
million tonnes (mt) of wheat in
2017-18, about 2% lower than
the year before, while prices of
major crops will continue to be
flat or in their lower ranges in
the months ahead, National
Collateral Management Services
Ltd said (NCML) on Tuesday. A
lower wheat crop will be against
the government’s expectations
of production crossing 100
million tonnes, NCML said,
adding the dip is due to lower
area planted by farmers. NCML is
a private company providing...
6
Japanese investment jumps to
$4,709 million in FY17
Japanese investments into India
have risen manifold in the last ten
years to reach USD 4,709 million in
FY2017, says a Ficci report. The FDI
inflow from the island nation was
at USD 84.74 million in the fiscal
2006-07, the report titled 'India
Japan Roadmap Towards Realising
Vision 2025' said. The report was
released here today …
7
Centre's FY19 capex may rise
16% to Rs 3.6 trn, as pvt sector
remains shy
Finance Minister Arun Jaitley is
looking at yet another year of the
Central Government and state-
owned companies carrying a bulk
of infrastructure spending. The
Centre’s capital expenditure for
2018-19 could be at least Rs 3.6
trillion (Rs 3.6 lakh crore), about Rs
510 billion (RS 51,000 crore) or 16
per cent higher than 2017-18…
24 January 2018
2

24 January 2018
Preview
Budget 2018-19
Union Budget Expectations: What’s in whose kitty?
Question is rife whether the budget will be populist
Indi
India’s Union Budget 2018-19 will be presented on 1 February 2018. Expectations and
excitement run high as it will be the first post-GST and last full-year budget before the
General Elections in 2019.
We note that the 2018-19 Budget will be presented against the backdrop of
uncertainty over tax collections post implementation of the Goods & Services Tax
(GST). We expect the government to revise its deficit target to 3.4% of GDP for FY18
(higher than the budgeted estimate of 3.2%) and to 3.2% of GDP for FY19 (higher than
the target of 3% set last year). It means that the plan to meet the 3% deficit target will
be postponed by one year (to 2019-20) for the third time.
As the current government will present its last full-year budget before the 2019
General Elections, many in the market expect a heavier dose of populism. However,
we believe that the government has limited financial resources to propose any
targeted scheme for the poor. We also do not expect much relief on the tax front,
except some reduction in the corporate tax rate for medium-sized companies.
From an equity market perspective, it is important to see how the Budget is able to
make a difference to the rural sector, how the government is able to carry the burden
of expectations, and whether the Budget strikes a right balance between good
economics and good politics, especially with the General Elections around the corner
next year. Also, as GST-related dust is still settling down, the markets will be keenly
watching fiscal deficit projections and whether the long-term fiscal consolidation path
is adhered to. We do expect the government to focus on rural and capex spending to
boost sentiment and revive growth further. However, given the hard-achieved gains
on fiscal consolidation, flexibility to go overboard on spending is limited, in our view.
Consumption pick-up (especially rural and discretionary), cyclical recovery in corporate
facing banks and gradual pick-up in private capex are our key themes to play in CY18.
TITAN, EMAMI, UNSP, ICICI BANK, RBL, HDFC, SHTF, PETRONET, HPCL, TATA MOTORS,
M&M, L&T, JSP, BHARTI are among our top ideas.
st
3% fiscal deficit target
postponed to 2019-20, peg
FY19 deficit at 3.2% of GDP
Gross borrowings to touch
INR7t, implying net
borrowings to rise to
INR4.9t (or 2.6% of GDP) in
FY19
In its
previous budget,
the center had budgeted 12-year slowest growth of 6.6% in
total spending, making it clear that fiscal policy is reaching its limits (refer
our report
for detailed analysis).
Not surprisingly then, economic activity weakened
considerably in FY18, further pressurizing the government. Following the fiscal
consolidation path amid growing demand to support economic recovery is the
biggest challenge for the government. An anemic rural economy and a weak
investment cycle add to the concerns. It would, thus, be interesting to see how the
Center handles the fires that are already raging.
Exhibit 1: Motilal Oswal’s expectations on key fiscal indicators from Union Budget 2018-19
Economic indicators
Unit
INR b
Gross fiscal deficit
% of GDP
INR b
Gross market borrowings
% of GDP
INR b
Net market borrowings
% of GDP
INR b
Nominal GDP
% YoY
BE = Budget estimates, F = Our Forecasts
FY16
5,328
3.9
6,233
4.6
4,416
3.2
136,820
9.9
FY17
5,261
3.5
6,225
4.1
4,067
2.7
151,837
11.0
FY18BE
FY18F
FY19F
5,465
5,601
5,861
3.2
3.4
3.2
5,820
6,250
7,000
3.5
3.7
3.8
3,502
3,932
4,920
2.1
2.4
2.6
168,475
167,067
186,062
11.8
10.0
11.4
Source: Union Budget documents, MoSL
24 January 2018
3

We will discuss four key themes in this note.
First,
we provide our projections of
FY18 revised estimates (RE) and budget estimates (BE) for FY19. We believe that
the deficit target of 3% of GDP will be postponed by one year for the third time
to 2019-20. We expect the government to revise the deficit target to 3.4% of
GDP for FY18 (higher than the budgeted estimate of 3.2%) and to 3.2% of GDP
for FY19 (higher than the target of 3% set last year).
Second,
we believe that capital spending of the government will be budgeted to
grow ~10% in FY19, following ~7% growth in FY18.
Third,
we believe that rural spending may be revised upward for FY18; however,
limited financial resources will make it difficult for the government to announce
a targeted scheme for the poor.
Fourth,
we expect the government to continue on its commitment to reduce the
corporate tax rate by lowering tax for companies with turnover of up to INR25b.
Such a measure could cost the government ~INR100b. Apart from this, we do
not expect the government to provide further direct/indirect tax relief.
Exhibit 2: Motilal Oswal’s expectations from Union Budget 2018-19
FY17A
INR b
Total Receipts
Revenue receipts
Gross Taxes
Net Taxes
Direct taxes
Corporation Taxes
Income Taxes
Indirect taxes
Non-tax revenue
Non-debt capital receipts
Divestment
Total Expenditure
Total excl. Subsidies
Revenue expenditure
Interest payments
Defense
Subsidies
Grants to states & UTs
Pensions
Police
MGNREGA
14,487
13,852
17,206
11,110
8,645
4,939
3,532
8,561
2,742
635
478
19,749
17,444
16,846
4,805
2,480
2,304
2,932
1,282
624
480
FY18BE
INR b
% of GDP
16,002
15,158
19,116
12,270
9,800
5,387
4,413
9,316
2,888
844
725
21,467
18,745
18,369
5,231
2,624
2,723
3,076
1,312
656
480
2,269
3,098
5,465
3,212
168,475
9.5
9.0
11.3
7.3
5.8
3.2
2.6
5.5
1.7
0.5
0.4
12.7
11.1
10.9
3.1
1.6
1.6
1.8
0.8
0.4
0.3
1.3
1.8
3.2
1.9
INR b
15,867
14,867
18,997
12,267
9,997
5,700
4,250
9,000
2,600
1,000
850
21,467
18,745
18,369
5,231
2,624
2,723
3,076
1,312
656
500
2,249
3,098
5,601
3,503
167,067
FY18F
% YoY
9.5
7.3
10.4
10.4
15.6
15.4
20.3
5.1
-5.2
57.5
78.0
8.7
7.5
9.0
8.9
5.8
18.2
4.9
2.4
5.1
4.2
16.0
6.7
% of GDP
9.5
8.9
11.4
7.3
6.0
3.4
2.5
5.4
1.6
0.6
0.5
12.8
11.2
11.0
3.1
1.6
1.6
1.8
0.8
0.4
0.3
1.3
1.9
3.4
2.1
INR b
17,749
16,749
21,525
13,899
11,285
6,400
4,900
10,240
2,850
1,000
800
23,610
20,610
20,200
5,794
2,900
3,000
3,229
1,450
689
550
FY19F
% YoY
11.9
12.7
13.3
13.3
12.9
12.3
15.3
13.8
9.6
0.0
-5.9
10.0
10.0
10.0
10.8
10.5
10.2
5.0
10.5
5.0
10.0
% of GDP
9.5
9.0
11.6
7.5
6.1
3.4
2.6
5.5
1.5
0.5
0.4
12.7
11.1
10.9
3.1
1.6
1.6
1.7
0.8
0.4
0.3
Other
1,938
Capital expenditure
2,903
Fiscal Deficit
5,261
Revenue Deficit
2,993
Nominal GDP
151,837
BE = Budget estimates, F = Our Forecasts
10.0
2,588
15.1
1.4
3,410
10.1
1.8
5,861
3.2
3,451
1.9
186,062
11.4
Source: Union Budget documents, MoSL
24 January 2018
4

3QFY18
January 2018
India Strategy
BSE Sensex: 36,140
S&P CNX: 11,084
3QFY18 interim earnings review
Headline numbers in-line; Technology surprises positively; signs of
consumption recovery evident
The current earnings-report cycle (3QFY18) has begun taking the spotlight, with 39
nd
MOSL Universe companies and 18 Nifty companies releasing their results until 22
January 2018. Encouragingly, the reporting season is off to a good start, with almost
75% of the MOSL Universe companies posting PAT that was either in line or above
our estimate.
We note that companies that have reported earnings so far comprise (a) 36% of
estimated PAT for the MOSL Universe, (b) 42% of estimated PAT for the Nifty and (c)
29% of India’s market cap. Early reporting trends indicate what has begun well could
also end well, marking the ‘End
of a long drought’.
Key takeaways:
The 3QFY18 earnings season has so far been broadly in line with expectations on
headline numbers. Of the 18 Nifty companies that have declared their earnings
results, 13 have either met or exceeded our estimates. The earnings
upgrade/downgrade ratio stands at 1, with 10 MOSL Universe companies seeing
upgrades of 3% and 10 seeing downgrades of 3%.
For the MOSL Universe, sales, EBITDA and PAT have grown 10.2%, 10.6% and 5.9%
YoY, as against estimates of 9.6%, 10.1% and 6.2%, respectively. For MOSL Universe
ex Oil, PSU Banks and Metals, sales, EBITDA and PAT have grown 6.8%, 6.6% and
6.8%, as against expectations of 6.7%, 4.6% and 5.5%, respectively.
Sales, EBITDA and PAT for the 18 Nifty companies have grown at 9.3%, 10.4% and 6%,
as against expectations of 8.7%, 9.6% and 5.9%, respectively. The results of
heavyweights (ITC, Reliance and Infosys) have been in line with estimates, supporting
earnings growth.
Approximately 87% (i.e. 34) of the 39 MOSL coverage companies have reported
EBITDA either in line or above estimates. On the PAT front, 29 of the 39 companies
have either met or exceeded expectations.
Among the Nifty components, Ultratech Cement, Bharti Infratel and Wipro have
missed our PAT estimates, while HUL and Bharti Airtel have surpassed our estimates.
Refer our December-17
Quarter Preview
Key trends from the results declared until 22 January 2018
1. IT has been the surprise pack of the earnings season so far. The outlook for the next
fiscal year has been optimistic across the board, with a pick-up in deal wins and
technology spending prospects by customers appearing upbeat. Margins performance
has been sanguine for the second consecutive quarter, with no disappointments and
midcap companies delivering a healthier beat on expectations.
2. Our CY18 theme of ‘Consumption
Recovery’
is playing out well, with strong
performances from HUL, JUBILANT, ZEE, HAVELLS, PC JEWELER and CROMPTON
CONSUMER. Commentaries from companies confirm bottoming out of rural
consumption. Normalization of supply chains post GST-led disruption is also aiding
pick-up in primary sales for companies.
3. In BFSI, private banks have reported strong loan growth and stable-to-improving
asset quality trends. Margins have compressed for many banks, led by moderation in
CASA mix and slower overall deposit growth.
4. The risks to margins from commodity cost inflation are clearly visible.
nd
Aggregate PAT up 6% YoY, Technology surprises positively
Aggregate performance of MOSL Universe:
Sales, EBITDA and PAT grew 10.2%,
10.6% and 5.9% YoY, as against expectations of 9.6%, 10.1% and 6.2%,
respectively. The results of heavyweights (ITC, Reliance, and Infosys) have been
5
24 January 2018

in line with estimates, supporting earnings growth. Notably, five out of the nine
technology companies have reported PAT above estimates.
Nifty Universe performance:
Sales grew by 9.3% YoY (our estimate: +8.7%),
EBITDA by 10.4% YoY (our estimate: +9.6%) and PAT by 6.0% YoY (our estimate:
+5.9%).
Top companies that beat estimates:
Bharti Airtel (265% beat), Hindustan
Unilever (10%), HCL Tech (6%) and Infosys (5%).
Top companies that missed estimates:
Bharti Infratel (31% miss), Ultratech
Cement (25%), Wipro (10%) and Axis Bank (9%).
HUL:
Above
est. Impressive
volumes,
strong margin
expansion
Bharti Airtel:
Above est. India
wireless EBITDA cushioned by
robust Africa EBITDA jump.
Ultratech: Below est. Margin
miss led by lower realizations
Exhibit 1:
Nifty-50: Performance-expectation gap (PAT growth)
IndusInd:
In-line;
strong core
operating
performance
TCS:
Recovery in
Retail offset by
muted BFS outlook
and margin risks
Infosys:
Good
show on
profitability;
Steady
performance
and outlook
Actual YoY (%)
Est YoY (%)
5.5
5.2
RIL, HDFC Bank, ITC:
In-line performance.
Wipro:
Healthcare
comeback offset by
Energy weakness
6.0
5.9
Axis Bank;
Asset quality
makes a strong
comeback
Asian Paints:
Demand for
paints remains subdued
1.9
-0.6
-3.3
12-Jan
2.7
-0.8
-2.6
11-Jan
0.7
Bharti Infra:
Below est. Telco
consolidation hurts earnings
-0.9
18-Jan
17-Jan
19-Jan
22-Jan
Earnings upgrades/downgrades:
For companies with market cap > USD3b
Top FY18E EPS upgrades:
Bharti Airtel (16%), Reliance Industries (4%)
Top FY18E EPS downgrades:
Axis Bank (20%), Bharti Infratel (16%), Shree
Cement (13%)
For companies with market cap < USD3b
Top FY18E EPS upgrades:
Jubilant Foodworks (42%), SH Kelkar (25%), HT
Media (19%)
Top FY18E EPS downgrades:
DCB Bank (13%), DB Corp (9%), MCX (8%)
24 January 2018
6

Indiabulls Housing Finance
BSE SENSEX
36,140
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 March
2018E 2019E
Net Fin inc
49.8
61.1
PPP
60.7
69.4
EPS (INR)
91.1 105.1
EPS Gr. (%)
32.8
15.4
BV/Sh. (INR)
324
367
RoA on AUM (%)
3.4
3.0
RoE (%)
29.9
30.4
Payout (%)
50.0
50.0
Valuations
P/E (x)
15.0
13.0
P/BV (x)
4.2
3.7
P/ABV (x)
4.2
3.7
Div. Yield (%)
3.3
3.9
S&P CNX
11,084
IHFL IN
Continued strong growth
421.3
Indiabulls Housing Finance's (IHFL) core operating performance was robust,
573.8/8.6
with strong AUM growth (+32% YoY) and stable reported spreads. We note
1397/741
9/5/49
of a one-time gain of INR7.68b due to the sale of 10% stake in Oak North
2174
Bank to GIC, Singapore.
76.4
AUM growth was in line with trend at 32% YoY to reach INR1.1t. This was
24 January 2018
3QFY18 Results Update | Sector: Financials
CMP: INR1,379
TP: INR1,630 (+18%)
Buy
2020E
76.4
85.4
128.3
22.1
421
2.8
32.6
50.0
10.6
3.2
3.2
4.7
driven by 43% YoY growth in disbursements to INR130b. Management is
bullish on supply pick-up in the affordable housing space.
Despite competitive pressures, IHFL managed to hold reported spreads
steady at 3.22% (vs. 3.25% in 2QFY18). Management continues to guide for
book spreads of 3-3.25%. Incremental cost of funds is around 7.5%.
The share of home loans in the overall book inched up 100bp QoQ to 59%.
With the share continuously inching up (to the target of 66% by FY20), we
believe spread pressure will continue.
Valuation view:
IHFL's transformation from a diversified lender to a
focused mortgage player has yielded returns, with RoE/RoA improving from
3%/0.8% in FY09 to 26%/3.4% in FY17. Focus on core mortgage loans and
market share gains should drive AUM growth of 25%+ over the next three
years. IHFL is among the lowest-levered HFCs. Asset quality trend is likely to
remain stable. We increase our FY18 estimates by 9% to factor in high
growth. However, we lower our FY19/20 estimates by 1%/3% to factor in
mild compression in spreads. Maintain
Buy
with a TP of INR1,630 (3.8x
FY20E book).
(INR Million)
FY17
2Q
25,098
3,651
28,749
28.0
16,279
12,470
24.6
3,258
9,212
24.3
2,352
6,861
-18
6,843
23.2
29.3
26.1
25.5
FY18
2Q
30,670
2,755
33,425
16.3
18,355
15,070
20.8
3,935
11,135
20.9
2,615
8,520
91
8,611
25.8
33.1
26.1
23.5
Quarterly Performance
Y/E March
Income from opera ti ons
Other Income
Total income
Y-o-Y Growth (%)
Interes t expens es
Net Income
Y-o-Y Growth (%)
Opera ti ng Expens es
Profit before tax
Y-o-Y Growth (%)
Ta x Provi s i ons
Net Profit
Mi nori ty Int
Net Profit after MI
Y-o-Y Growth (%)
AUM Growth (%)
C/I Ra ti o i ncl provi s i ons (%)
Ta x Ra te (%)
E: MOSL Es ti ma tes
1Q
23,720
2,255
25,975
28.3
14,109
11,866
33.9
3,116
8,750
26.4
2,401
6,349
-49
6,301
23.2
31.5
26.3
27.4
3Q
25,859
4,186
30,045
30.2
16,329
13,716
26.8
3,658
10,058
24.9
2,555
7,502
13
7,515
24.7
30.8
26.7
25.4
4Q
29,314
2,935
32,249
21.8
17,391
14,858
15.6
5,160
9,698
9.0
1,325
8,373
32
8,405
24.4
32.9
34.7
13.7
1Q
29,560
2,690
32,250
24.2
17,722
14,528
22.4
3,928
10,600
21.1
2,764
7,836
46
7,882
25.1
33.0
27.0
26.1
3Q
33,492
7,565
41,057
36.7
19,531
21,525
56.9
5,932
15,594
55.0
3,939
11,655
23
11,677
55.4
31.8
27.6
25.3
4Q
36,175
3,024
39,199
21.6
20,611
18,588
25.1
4,579
14,009
44.5
3,516
10,493
50
10,543
25.4
28.7
24.6
25.1
FY17
103,990
13,027
117,017
26.8
64,108
52,910
24.4
15,192
37,718
20.5
8,633
29,085
-22
29,064
24.0
32.9
22.9
FY18E
129,897
16,034
145,931
24.7
76,219
69,711
31.8
18,374
51,337
36.1
12,834
38,503
210
38,293
31.8
28.7
25.0
24 January 2018
7

RESULTS
FLASH
United Spirits
TP: INR3,450
Neutral
23 January 2018
Results Flash | Sector: Consumer
BSE SENSEX
36,140
S&P CNX
11,084
CMP: INR3,751
Volumes disappoint; gross margins expand 530bp YoY
Conference Call Details
Date:
24 January 2018
Time:
12:00am IST
Dial-in details:
+91-22-3960 0651
th
Financials & Valuations (INR b)
2018E 2019E 2020E
Y/E Mar
84.6
99.8
117.0
Net Sales
10.9
15.0
19.3
EBITDA
5.3
8.1
11.2
NP
36.5
56.0
76.9
EPS (INR)
36.5
53.5
37.3
EPS Gr. (%)
BV/Sh. (INR) 193.0 260.2 357.6
18.9
21.5
21.5
RoE (%)
12.9
16.6
18.6
RoCE (%)
P/E (x)
102.8
67.0
48.8
P/BV (x)
19.4
14.4
10.5
UNSP posted standalone net sales decline of 7.8% YoY to INR22.6b,
with a
sharp 14.2% fall (est. of -5%) in overall volumes YoY on a base of 5% decline.
Management attributed the decline to the adverse impact of route to market
changes (changing to corporation model of distribution in the state of
Haryana), some impact of highway ban, and one-off impact of operating model
changes.
Prestige & Above volumes declined 2.9% YoY,
while Popular volumes fell
22.2% YoY. Underlying net sales (excluding one-off impact of operating model
changes) declined 2% YoY in 3QFY18, led by the Prestige & Above (-1% YoY)
and Popular (-2% YoY) segments.
Gross margin expanded 530bp YoY
(-20bp QoQ) to 47.4%, led by price
increase, productivity initiatives and operating model changes. Advertising
expenses were up sharply by 320bp YoY to 11.5% and other expenses were up
by 210bp YoY. This led to flat EBITDA margin YoY. Excluding the one-off impact,
the gross margin expanded 370bp, while EBITDA margin contracted 30bp YoY.
EBITDA declined 7.6% YoY to INR2.7b (est. of INR3.6b). Interest costs declined
28.6% YoY to INR658m, led by debt reduction and favorable rates. The
company issued NCDs worth INR7.5b to refinance higher cost debt recently.
Adjusted PAT stood flat at INR1.5b (est. of INR1.9b).
Nine-months underlying performance:
Net sales declined 2% YoY, with 5%
underlying volumes decline. Prestige & Above sales grew 1%, while Popular
sales declined 6%. Gross and EBITDA margin expanded 300bp and 75bp YoY,
respectively. Adspends were up 13% YoY on an absolute basis in the 9MFY18
period to INR5.7b.
We have a
Neutral
rating on the stock.
(INR Million)
FY18
2Q
3Q
4QE
-15.9 -14.2
5.0
19,513 22,633 24,662
-3.7
-7.8
21.8
16,786 19,910 20,769
2,727 2,723 3,893
14.0
12.0
15.8
18.5
-7.6
46.8
326
337
498
659
658
748
1,742 1,728 2,647
305
236
394
2,047 1,964 3,041
681
491 1,217
33.3
25.0
40.0
1,366 1,473 1,825
39.6
-0.3
63.2
FY17
-3.1
85,476
4.4
75,650
9,826
11.5
18.8
1,323
3,690
4,813
995
5,808
1,923
33.1
3,885
87.1
FY18
-11.4
84,626
-1.0
73,709
10,917
12.9
11.1
1,482
2,768
6,667
1,244
7,911
2,611
33.0
5,300
36.5
FY18
3QE
-5.0
24,943
0.0
21,334
3,609
14.5
22.9
359
701
2,549
363
2,912
990
34.0
1,922
22.0
Var.
(%)
-9.3%
-24.6%
Quarterly Performance
Y/E March
(Standalone)
Volume Growth %
Total Revenues
YoY Change (%)
Total Exp
EBITDA
Margins (%)
EBITDA growth (%)
Depreciation
Interest
PBT From operations
Other income
PBT
Tax
Rate (%)
Adj. PAT
YoY Change (%)
E: MOSL Estimates
1Q
-0.2
20,405
10.4
18,271
2,134
10.5
24.5
261
1,030
843
241
1,084
253
23.3
831
616.1
FY17
2Q
3Q
4Q
1.0
-5.0
-8.2
20,268 24,553 20,250
7.1
1.9
-0.6
17,967 21,607 17,599
2,301 2,946 2,651
11.4
12.0
13.1
-20.7
15.6 142.3
332
313
418
885
922
853
1,084 1,711 1,380
339
346
253
1,423 2,057 1,633
445
580
515
31.3
28.2
31.5
978 1,477 1,118
-4.2
86.1 237.8
1Q
-18.9
17,818
-12.7
16,244
1,574
8.8
-26.2
321
703
550
309
859
222
25.8
637
-23.4
-32.2%
-32.6%
-23.4%
24 January 2018
8

23 January 2017
3QFY18 Results Update | Sector: Financials
RBL Bank
BUY
BSE SENSEX
36,140
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg. Val, INR m
Free float (%)
S&P CNX
11,084
RBL IN
Strong operating performance; asset quality blip from one-off slippage
375.2
RBL’s 3QFY18 PAT increased 28% YoY to INR1.65b, below our estimate by
201.5/3.1
10%, mainly due to opex missing estimates by 9% (retail expansion costs)
270 / 189
and higher provisions (as the bank provided INR500m toward MFI book, out
-11/-17/-10
of total provisions of INR823m), despite NII (INR4.7b; +11%/+45% QoQ/YoY)
63
exceeding estimate by 5%. Key positives were: a) loan growth of 10% QoQ
30.1
CMP: INR537
TP: INR680 (+27%)
Financials & Valuations (INR b)
Y/E March
2018E 2019E
NII
17.9
23.3
OP
13.4
18.2
NP
6.6
9.4
NIM (%)
3.4
3.4
EPS (INR)
15.8
22.7
BV/Sh. (INR)
155.8 174.5
ABV/Sh. (INR)
151.2 168.9
RoE (%)
12.2
13.8
RoA (%)
1.2
1.3
Valuations
P/E(X)
34.0
23.6
P/BV (X)
3.4
3.1
P/ABV (X)
3.6
3.2
Div. Yield (%)
0.4
0.6
2020E
30.6
23.8
12.6
3.4
30.3
199.5
193.4
16.2
1.4
17.8
2.7
2.8
0.8
and 38% YoY, b) fee income growth of 50% YoY, driven by 183% growth in
distribution/CC fees and c) margin improvement of 15bp QoQ to 3.89%,
driven partly by a reduction in cost of funds from CASA inflows and partly by
an increase in the CD ratio.
Absolute GNPAs increased 19% QoQ (1.56% of loans, +12bp QoQ). The
sequential decline in asset quality was mainly due to slippage from one SDR
account of INR525m, which should be upgraded in 4Q, according to
management. NNPA increased 37% during the quarter to INR3.6b (0.97%,
+19bp QoQ), as reported PCR declined 573bp QoQ to 52.5%.
Loan growth was led by non-wholesale book growth of 43% YoY, increasing
the share of non-wholesale to 39.5% from 38.1% a year ago. Strong CASA
growth of 33% YoY (ahead of deposit growth of 29% YoY) led to CASA ratio
improvement of 80bp YoY (+30bp QoQ) to 24%.
Other highlights:
a) Microfinance NPA stood at INR1.5b. b) 62% of
incremental expenses during the quarter were on account of retail
expansion, especially in cards. c) Cards portfolio grew to 0.62m cards, with
0.25m BAF cards.
Valuation view:
With a diverse product portfolio, no legacy issues, highly
capable management and a low market share, we expect RBL to report industry
leading loan CAGR of ~35% over FY17-20. We expect stable/improving margins
due to changing loan mix toward high-yielding loans, a sharp fall in cost of bulk
deposits and an improvement in the CD ratio. Strong balance sheet growth is
expected to drive operating leverage. We maintain
Buy
with a TP of INR680
based on 3.4x Mar’20E BV.
(INR m)
FY17
2Q
3,029
1,691
4,721
2,530
2,191
781
1,410
512
899
FY18
2Q
4,202
2,411
6,612
3,581
3,032
749
2,283
776
1,506
67.6
30.8
35.0
4.9
1.4
FY17
3Q
4,673
2,582
7,255
3,921
3,334
823
2,511
858
1,653
28.5
28.7
37.8
5.8
1.6
4Q
5,226
2,863
8,089
4,162
3,927
1,010
2,917
916
2,001
53.7
23.0
35.0
5.7
1.4
12,213
7,555
19,768
10,564
9,204
2,389
6,815
2,354
4,460
52.5
25.0
35.0
3.6
1.2
FY18
17,884
10,425
28,310
14,903
13,407
3,527
9,880
3,310
6,570
47.3
23.0
35.0
5.7
1.4
Quarterly Performance
Net Interest Income
Other Income
Net Income
Operating Expenses
Operating Profit
Other Provisions
Profit before Tax
Tax Provisions
Net Profit
% Change (Y-o-Y)
Operating Parameters
Deposit Growth (%)
Loan Growth (%)
Asset Quality
Gross NPA (INR b)
Gross NPA (%)
E: MOSL Estimates
1Q
2,447
1,675
4,122
2,277
1,845
426
1,419
445
973
3Q
3,216
1,823
5,038
2,687
2,351
362
1,989
703
1,287
4Q
3,522
2,366
5,887
3,070
2,818
821
1,997
695
1,301
1Q
3,784
2,569
6,353
3,239
3,114
945
2,169
759
1,410
37.8
44.0
2.5
1.1
2.7
1.1
43.9
46.3
2.9
1.1
42.1
38.7
3.6
1.2
37.3
39.7
4.6
1.5
24 January 2018
9

23 January 2018
3QFY18 Results Update | Sector: Financials - NBFC
Gruh Finance
Neutral
BSE SENSEX
36,140
Bloomberg
Equity Shares (m)
M.Cap.(INR b)/(USD b)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
Free float (%)
Financials & Valuation (INR b)
Y/E March
2018E 2019E
NII
PPP
PAT
EPS (INR)
EPS Gr. (%)
BV/Sh. INR
ABV/Sh. INR
RoA (%)
RoE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
Div. Yield (%)
59.6
17.9
0.6
50.1
14.7
0.7
6.7
6.2
3.6
9.9
22.1
33.2
33.2
2.4
32.9
34.0
7.9
7.3
4.3
11.8
18.8
40.3
40.3
2.4
32.2
34.0
S&P CNX
11,084
GRHF IN
364.6
251.9/3.8
714/331
12/18/46
126
42.0
CMP: INR592
Steady quarter
TP: INR540 (-9%)
2020E
9.5
8.9
5.3
14.6
23.4
49.0
49.1
2.4
32.6
34.0
40.6
12.1
0.8
Gruh Finance’s (GRHF) PAT rose 28.3% YoY to INR822m (in-line) in 3QFY18.
The quarter was characterized by a strong pick-up in disbursement growth
(due to a lower base), stable margins and good asset quality.
Loan growth was in line with trend at 18% YoY, driven by retail home loans.
However, disbursement growth was robust at 37% YoY – a pleasant
surprise
– led by home loans and LAP. Developer loan disbursements were
largely in line with trend.
Interestingly, GRHF was able to sustain yields at 11.8% (same for the past
three quarters), despite a very competitive environment. Cost of funds
witnessed a minor uptick (+7bp QoQ), mainly due to a rise in GSec yields.
Asset quality was stable, with GNPL/NNPL ratio of 73bp/7bp. However, there
was an 11/18bp QoQ/YoY rise in the GNPL ratio of home loans.
While capital adequacy is sufficient at the moment, GRHF might look to
raise capital a year or so later if loan demand picks up.
Valuation view:
GRHF has performed impressively, with 25% loan book CAGR
and 26% PAT CAGR over the last decade. At the same time, it has not
compromised on underwriting standards, which reflects in the GNPL ratio of
0.7%. However, loan growth has slowed down meaningfully from the run-rate of
~25% a few quarters ago. In addition, the trajectory of spreads/margins going
forward is uncertain, if GSec yields continue to rise. We maintain our estimates
as well as our
Neutral
rating, with a TP of INR540 (11x FY20E BV). We would look
to upgrade our rating with clear visibility of growth picking up and spreads
remaining stable.
24 January 2018
10

RESULTS
FLASH
PNB Housing Finance
23 January 2018
Results Flash | Sector: Financials
BSE SENSEX
36,140
S&P CNX
11,084
CMP: INR1,301
Positive surprise on growth, asset quality stable
Financials & Valuations (INR b)
Y/E March
2018E 2019E
NII
15.7
21.0
PPP
15.8
21.0
PAT
8.7
11.0
EPS (INR)
52.5
66.5
BV/Sh. (INR)
371.1 423.7
RoAA (%)
1.7
1.5
RoE (%)
15.0
16.7
Payout (%)
20.9
20.9
P/E (x)
24.7
19.5
P/BV (x)
3.5
3.1
Div. Yield (%)
0.7
0.9
2020E
27.9
28.1
14.7
88.8
494.0
1.5
19.4
20.9
14.6
2.6
1.2
PNB Housing Finance’s (PNBHF) 3QFY18 PAT grew at a robust 58% YoY to
INR2.18b, led by strong AUM growth, YoY improvement in margins and lower
C/I ratio YoY.
Disbursements more than doubled YoY to INR93b (off a low base).
Consequently, AUM increased 53% YoY to INR577b, 5% ahead of our estimate
of INR549b.
We await management clarity on the drivers of the strong growth.
AUM mix continues to inch closer toward non-core loans (i.e. LAP, construction
finance, etc.). Share of these loans increased 160bp QoQ and 400bp YoY to
42.8%.
C/I ratio (calculated) declined 260bp YoY, but increased 110bp QoQ to 24.1%.
We await management clarity on the same. We believe a sustained reduction
in the C/I ratio would be a key driver for RoE, and consequently, the stock
performance.
Asset quality remained largely stable, with a GNPL/NNPL ratio of 0.42%/0.33%.
In addition to provisions for standard assets and NPLs, PNBHF holds a
contingency provision buffer of INR760m.
Valuation view:
PNBHF continues delivering strong growth in its loan book.
Increasing geographical spread and new branch openings (110 branches in
FY20E v/s 66 in FY17) are expected to result in loan book growth to ~INR1t by
FY20. With the pace of investments slowing down, coupled with operating
leverage benefits kicking in, the expense ratio is set to decline meaningfully.
Credit costs, however, are expected to inch up marginally on account of
portfolio seasoning.
24 January 2018
11

24 January 2018
3QFY18 Results Update | Sector: Financials
Dewan Housing
Buy
BSE SENSEX
36,140
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 March
2018E 2019E
NII
20.1
26.5
PPP
21.5
28.2
Adj. PAT
11.7
14.9
EPS (INR)
37.4
47.5
EPS Gr. (%)
26.5
26.8
BV (INR)
282
321
RoAA (%)
1.2
1.3
RoE (%)
14.0
15.8
Payout (%)
17.4
17.4
Valuations
P/E (x)
16.4
12.9
P/BV (x)
2.2
1.9
P/ABV (x)
2.2
1.9
Div. Yield (%)
0.9
1.2
S&P CNX
11,084
DEWH IN
Strong growth, stable cost ratios; re-rating to continue
313.2
Dewan Housing Finance’s (DEWH) 3QFY18 PAT grew 25% YoY to INR3.1b.
196.9 / 3.0
The quarter was characterized by strong AUM growth, a stable C/I ratio
678/269
and a secular decline in cost of funds.
-3/22/91
1883
AUM grew 29% YoY to INR1t, largely driven by 54% YoY disbursement
growth. DEWH reported disbursements of INR108b, with the highest
60.8
CMP: INR614
TP: INR720 (+17%)
2020E
33.1
35.2
18.8
59.9
26.1
371
1.3
17.3
17.4
10.3
1.7
1.7
1.5
growth rate in the last 19 quarters. We note that sanctions grew 75% YoY
to INR166b. This strong growth was largely led by the non-home portfolio.
Loan mix is now more skewed toward LAP (at 18%, +20bp QoQ) and
builder finance (at 15%, stable QoQ). Contribution of home loans reduced
by 70bp QoQ to 63% of loan book.
Calculated NIM remained largely unchanged at 3.03%, although we note a
secular decline in calculated cost of funds (-10bp QoQ to 8.75%). Funding
mix remained largely stable, with banks and NCDs contributing 41% and
41%, respectively.
Opex grew 19% YoY to INR1.8b, manifesting into PPoP of INR5.6b (+35%
YoY) and a cost-to-income ratio of 24.1% (+20bp QoQ). Continued focus on
cost rationalization should translate into higher PAT over the medium
term, in our view.
Asset quality was stable, with the GNPA ratio at 0.96%.
Valuation view:
DEWH continues to be a focused play on low-ticket housing.
This, along with the new-found opportunities in LAP and builder finance, is
likely to keep its AUM on a high-growth trajectory. We believe the continued
focus on cost rationalization and a secular decline in cost of funds are likely to
result in higher return ratios and further re-rating in the medium term.
Buy
with a TP of INR720 (2x FY20E BVPS).
FY17
2Q
3Q
21,227 23,151
16,307 18,001
4,920
5,150
21.0
20.8
451
514
5,371
5,664
18.3
21.6
1,398
1,497
6.1
9.1
3,972
4,167
23.2
26.9
450
450
3,522
3,717
1,196
1,269
2,326
2,448
29.0
31.7
16.0
16.9
38.5
28.0
26.0
26.4
34.0
34.2
FY18
2Q
3Q
25,034 25,204
19,034 18,944
6,000
6,260
22.0
21.6
1,108
1,138
7,108
7,398
32.4
30.6
1,698
1,781
21.4
19.0
5,411
5,617
36.2
34.8
1,070
1,000
4,341
4,617
1,408
1,558
2,933
3,060
26.1
25.0
24.6
21.7
10.8
12.7
23.9
24.1
32.4
33.7
FY17
4Q
26,082
19,334
6,748
25.9
1,173
7,921
25.7
2,056
19.8
5,865
27.9
1,133
4,732
1,605
3,128
26.0
25.6
16.3
26.0
33.9
86,531
66,536
19,995
19.8
2,182
22,177
21.4
5,973
8.7
16,204
26.9
2,180
14,024
4,754
9,270
27.1
18.5
33.1
26.9
33.9
(INR M)
FY18
99,849
75,181
24,668
23.4
3,969
28,637
29.1
7,104
18.9
21,533
32.9
4,033
17,500
5,775
11,725
26.5
22.6
23.9
24.8
33.0
DEWH: Quarterly performance
Y/E March
Interest Income
Interest Expenses
Net Interest Income
YoY Growth (%)
Fees and other income
Net Income
YoY Growth (%)
Operating Expenses
YoY Growth (%)
Operating Profits
YoY Growth (%)
Provisions
Profit before Tax
Tax Provisions
Profit after tax
YoY Growth (%)
Loan growth (%)
Borrowings growth (%)
Cost to Income Ratio (%)
Tax Rate (%)
E: MOSL Estimates
1Q
19,319
14,754
4,565
14.5
275
4,840
15.5
1,361
8.4
3,479
18.6
450
3,029
1,015
2,014
16.2
18.3
20.4
28.1
33.5
4Q
22,835
17,475
5,360
22.6
943
6,303
29.1
1,717
10.8
4,586
37.7
830
3,756
1,273
2,483
30.9
16.7
33.1
27.2
33.9
1Q
23,529
17,869
5,660
24.0
549
6,209
28.3
1,570
15.4
4,640
33.4
830
3,810
1,205
2,605
29.3
19.8
34.4
25.3
31.6
24 January 2018
12

RESULTS
FLASH
Crompton Gr Cons
TP: INR315
BUY
23 January 2018
Results Flash | Sector: Capital goods
BSE SENSEX
36,140
S&P CNX
11,084
CMP: INR270
Sales marginally below estimates, PAT in-line
Conference Call Details
Date:
24 Jan 2017
Time:
11:00am IST
Dial-in details:
+91-22-3960 0818
th
Financials & Valuations (INR b)
2018E 2019E
Y/E Mar
Net Sales
41.8
47.3
EBITDA
5.2
6.4
NP
3.3
4.1
EPS (INR)
5.2
6.5
EPS Gr. (%)
10.9
25.2
BV/Sh. (INR)
11.7
14.3
RoE (%)
51.0
49.8
RoCE (%)
28.7
30.8
P/E (x)
52.1
41.6
P/BV (x)
23.0
18.8
2020E
53.7
7.4
4.9
7.8
20.7
17.5
49.3
35.1
34.5
15.5
CROMPTON’s sales grew 7% YoY to INR9.4b, marginally below our estimate of
INR9.6b.
LTL sales growth adjusted for excise stood at 12.2%.
Note that
on an
LTL basis, Havells grew at 14% YoY and V Guard at 23% in 3QFY18.
Lighting
segment sales were at INR3.3b (+14% YoY on reported basis;
up ~23% on LTL
basis),
while Consumer durables sales were at INR6.2b (-1.1% on reported
basis;
up ~8-9% on LTL basis).
Gross margin expanded 270bp YoY to 33.1% v/s our estimate of 31.6%. Clearly,
the company has been able to take price hikes to offset the sharp increase in
commodity prices over the previous quarters.
EBITDA stood at INR1.2b (+20% YoY), with the margin at 12.4% (+130bp YoY)
v/s our estimate of 11.9%. Employee costs rose 17% YoY to INR742m. There
has been a sharp increase in unallocable costs in the segmental results to
INR365m from INR311m in 3QFY17. EBIT margin in Lighting stood at 13.8% and
in Consumer durable at 18.2%.
Other income stood at INR66m v/s our estimate of INR80m.
PAT of INR0.7b (+28 % YoY) was in line with our estimate of INR0.7b.
Valuation and view:
The stock trades at 41.6x/34.5x FY19E/20E EPS. Maintain
Buy
with a TP of INR315.
Crompton: Quarterly Estimates (Standalone)
Y/E March
Sales
Change (%)
EBITDA
Change (%)
As of % Sales
Depreciation
Interest
Other Income
PBT
Tax
Effective Tax Rate (%)
Adjusted PAT
Change (%)
Extra-ordinary Income (net)
Reported PAT
Change (%)
1Q
10,962
1,573
14.4
28
180
34
1,400
465
33.2
935
-
935
FY17
2Q
3Q
4Q
1Q
8,737 8,792 10,762 10,554
8.5
7.4
-3.7
1,012
972 1,386 1,294
17.4
9.0 -17.8
11.6
11.1
12.9
12.3
27
26
29
32
161
162
153
162
41
50
69
97
865
834 1,273 1,198
286
33.1
579
(4.5)
574
290
34.8
544
28.3
-
544
32.0
388
30.5
885
16.6
(20.7)
864
29.8
395
33.0
802
(14.2)
-
802
(14.2)
FY18
FY17
FY18
2Q
3Q
4QE
9,597 9,382 12,004 39,759 41,792
9.8
6.7
11.5 119.5
5.1
1,207 1,165 1,583 4,902 5,249
19.3
19.8
14.3 134.0
7.1
12.6
12.4
13.2
12.3
12.6
32
32
20
110
116
157
158
125
655
658
35
66
128
195
326
1,054 1,040 1,566 4,331 4,801
346
32.8
708
22.3
-
708
23.3
345
33.2
695
27.9
-
695
27.9
465
29.7
1,101
24.4
-
1,101
27.3
1,399
32.3
2,932
138.7
2,907
166.9
1,551
32.3
3,250
10.9
3,250
11.8
Vs Est.
3Q
9,600
8.0
1,140
14.8
11.9
30
150
80
1,040
350
33.7
690
20.3
-
690
20.3
(INR m)
Var.
(%)
-2.3%
2.2%
0.0%
0.7%
0.7%
24 January 2018
13

Mahindra CIE
BSE SENSEX
36,140
S&P CNX
11,084
23 January 2018
Update
| Sector:
Automobiles
CMP: INR240
TP: INR297(+24%)
Buy
Ahead of the curve in identifying EV prospects
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 (%)
MACA IN
378
270/189
-11/-17/-10
90.7
1.4
40.1
30.1
Ample opportunities in BEV to help mitigate potential weakness in
powertrain/gearbox components
We attended Mahindra CIE’s (MACA) Investor Meet, where Mr Inigo Loizaga, Engineering
Director, CIE Automotive Group, provided updates on technological trends in the
automotive industry (click
here for the presentation).
According to Mr Loizaga, CIE is
ahead of the curve in terms of developing new technologies for electric vehicles (EVs). He
also expressed optimism that evolving opportunities within BEV and PHEV components
(aluminum, stamping and plastic) could more than compensate for the potential threat to
powertrain and gearbox components, and that macro trends like increasing outsourcing
could benefit companies like CIE and MACA.
Financials Snapshot (INR b)
2017 2018E 2019E
Y/E Dec
53.2 60.7
65.7
Net Sales
5.3 60.7
65.7
EBITDA
1.7 56.5
61.0
PAT
4.6
9.0
12.0
EPS (INR)
28.5 94.3
33.0
Gr. (%)
86.4 95.4 107.3
BV/Sh (INR)
6.6
9.9
11.8
RoE (%)
5.7
8.3
10.0
RoCE (%)
51.8 26.7
20.0
P/E (x)
2.8
2.5
2.2
P/BV (x)
Shareholding pattern (%)
As On
Dec-17 Sep-17 Dec-16
Promoter
69.9
69.9
69.9
DII
7.1
6.4
6.7
FII
5.7
5.5
5.1
Others
17.3
18.3
18.3
FII Includes depository receipts
Stock Performance (1-year)
Mahindra CIE
Sensex - Rebased
280
260
240
220
200
180
Key highlights:
Over the last several decades, the automotive industry has seen multiple
evolutions, from injection systems (from carburetor distributor to GDi 350bar),
to auxiliaries electrification (e.g. hydraulic steering to electric steering and
amplification in the braking forced changing from air/vacuum to electrically
driven force) to materials usage (e.g. casted crankshafts to forged crankshafts).
According to management, CIE has always been ahead of the curve to
anticipate changes in the automotive industry to best meet technology
requirements of OEMs in all markets and segments where it operates.
CIE has demonstrated its presence in critical EV components. It is already
supplying products to leading EV OEMs globally such as Renault, Nissan, Tesla,
Mahindra Reva, Magneti Marelli, and Bosch, among others.
CIE is also engaged in the supply of aluminum and machining components
(such as platine assembles, battery supporter, end plate and housing trans
case) to Renault, metal stamping components (battery structure, winding hub,
battery cover) to Renault and Nisan, stamping and welding components
(corners, skid plates, floor, battery wall, cross member) to Tesla, and rotor
components to Borg Warner.
The EV industry is grappling with various uncertainties, such as lithium/other
raw material (RM) availability, RM/battery costs, government grants, and huge
capex for battery factories/charging infrastructure – this is likely to keep EV
penetration under check. Most forecasts point toward average global EV
penetration of 7-8%.
We are enthused with CIE’s readiness to move ahead in the EV segment with a
diversified product portfolio. MACA would leverage upon CIE’s technology and
product portfolio in aluminum and plastics beyond its own expertise in forging,
machining and stamping.
Valuation view:
We value MACA at 20x CY19E consolidated EPS (at ~20% discount
to Bharat Forge’s target multiple of ~25x, given its relatively weak, though
improving, capital efficiency). Maintain
Buy
with a target price of INR297.
24 January 2018
14

December 2017 Results Preview | Sector: Healthcare
Biocon
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
BIOS IN
600.0
325 / 5
548 / 295
18 / 56 / 45
CMP: INR542
TP: INR485 (-11%)
Neutral
Financial Snapshot (INR Billion)
Y/E March
2017 2018E 2019E 2020E
Sales
EBITDA
NP
EPS (INR)
EPS Gro. (%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
Div. Yield (%)
53.1
6.7
28.5
0.6
84.0
6.4
35.5
0.4
54.9
5.9
25.7
0.6
29.5
5.2
16.3
1.0
40.8
11.4
6.0
10.2
31.8
80.6
12.3
9.4
42.2
9.2
3.9
6.5
-36.7
85.2
7.6
6.6
51.6
12.6
5.9
9.9
53.0
92.2
10.7
11.2
70.3
19.7
11.0
18.3
85.8
105.1
17.4
17.6
Key issues to watch out
Biocon’s revenue is likely to post muted growth of 2% YoY to
INR10.5b, on the back of 8% YoY decline in Small Molecules
business (~35% of sales). Biologics and Branded Formulation
business are expected to post significant growth of 40% and 22%
YoY, respectively.
EBITDA is expected to decline ~15% YoY to INR2.2b, with EBITDA
margins at 21%.
We expect PAT to decline to INR1b, primarily due to an increase
in depreciation due to commencement of Malaysian facility and
decline in EBITDA margin.
Key growth drivers for FY18E will be 1) commercialization and
ramp-up of the insulin plant in Malaysia, 2) ramp-up in CRO
division, 3) contribution from API/immuno-suppressants supplies
to partners and 4) branded formulations in India. However, capex
for long-term initiatives is likely to exert pressure on profitability
and return ratios in the near term.
Biocon can generate sales of ~USD350m-400m from sales of
these there biosimilars in medium term. Trastuzumab approval by
US FDA is an important milestone for the company. We maintain
our neutral rating with target price of INR485@ 26x FY20E PER.
Update on Middle-East problems.
Progress on Rh-Insulin/Glargine in Europe/US and other out-licensing
opportunities.
Quarterly Performance Consolidated
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Minority Interest
PAT
YoY Change (%)
Margins (%)
1Q
9,920
22.4
7,289
2,631
26.5
661
57
409
2,322
552
23.8
104
1,666
34.6
16.8
FY17
2Q
3Q
9,541
10,290
21.4
24.2
7,141
7,680
2,400
2,610
25.2
25.4
683
710
65
90
384
630
2,036
2,440
417
550
20.5
22.5
152
180
1,467
1,710
51.2
66.0
15.4
16.6
4Q
9,250
-2.1
7,430
1,820
19.7
730
50
653
1,693
110
6.5
150
1,433
-56.6
15.5
1Q
9,337
-5.9
7,416
1,921
20.6
988
161
540
1,312
376
28.7
123
813
-51.2
8.7
FY18E
2Q
3QE
9,686 10,509
1.5
2.1
7,864
8,302
1,822
2,207
18.8
21.0
936
1,050
138
100
508
500
1,256
1,557
425
374
33.8
24.0
144
175
687
1,008
-53.2
-41.0
7.1
9.6
4QE
11,845
28.1
9,423
2,421
20.4
1,464
72
452
1,338
336
25.1
470
531
-62.9
4.5
(INR Million)
FY17
40,787
18.2
29,421
11,366
27.9
2,772
260
0
8,334
1,616
19.4
760
5,958
28.3
14.6
FY18E
42,209
3.5
33,005
9,204
21.8
4,438
471
2,000
6,295
1,511
24.0
912
3,873
-35.0
9.2
24 January 2018
15

December 2017 Results Preview | Sector: Financials
Canara Bank
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
Financial Snapshot (INR b)
Y/E March
2017 2018E
NII
98.7 97.0
OP
89.1 84.6
NP
11.2 16.9
NIM (%)
1.9
1.7
EPS (INR)
18.8 28.4
EPS Gr. (%)
NM 51.0
BV/Sh. (INR)
471
481
ABV/Sh. (INR)
234
254
RoE (%)
4.2
5.0
RoA (%)
0.2
0.3
Div. Payout (%)
6.4 11.6
Valuations
P/E (x)
18.8 12.5
P/BV (x)
0.7
0.7
P/ABV (x)
1.51 1.39
Div. Yield (%)
0.3
1.7
CBK IN
543.0
192 / 3
463 / 251
-6 / -2 / 10
2019E 2020E
125.6 154.5
114.5 145.1
40.5 59.5
2.0
2.2
67.8 99.7
138.9 47.1
543
637
328
460
11.3 14.7
0.6
0.8
11.6 11.6
5.2
0.7
1.08
1.7
3.5
0.6
0.77
1.7
CMP: INR353
TP: INR366 (+4%)
Neutral
We expect slippages to moderate from the previous quarters but
remain elevated. Continued fresh slippages and ageing of NPLs
are expected to keep credit costs high (we factor in ~1.7% credit
costs in 3QFY18).
We expect loan growth to pick up to 11% YoY (+3% QoQ) v/s 10%
YoY (+5% QoQ) in 2QFY18. Deposit growth is expected to be
muted at ~1% QoQ.
We expect NIM to pick up from here (~60bp YoY off a low base) at
2.64%. Overall NII should grow ~18% YoY, led by a revival in loan
growth off a low base.
Non-interest income is expected to decline sharply with
moderation in trading gains even as fee income growth is
expected to pick up.
We expect PAT of ~INR2.6b, (-1.5% QoQ). The bank trades at 0.7x
FY19E BV and 5.2x FY19E EPS. Maintain Neutral.
Key issues to watch for
Quantum of loans rescheduled under 5:25, SDR and S4A.
Outlook on balance sheet growth.
Quarterly Performance
1Q
23,074
-8.3
15,847
38,921
20,732
18,189
-9.2
14,929
3,260
970
2,290
-52.2
1.9
-1.4
-0.9
323.3
9.7
FY17
2Q
24,424
-7.7
17,818
42,241
20,834
21,408
10.1
15,857
5,550
1,981
3,569
-32.5
2.0
-0.2
1.3
333.2
9.8
3Q
24,138
8.4
17,917
42,055
22,242
19,813
27.6
14,846
4,968
1,749
3,219
278.8
1.8
4.0
-0.1
343.4
10.0
4Q
27,082
14.1
23,963
51,045
21,316
29,729
80.6
27,087
2,642
500
2,142
NA
2.0
3.2
5.3
342.0
9.6
1Q
27,132
17.6
21,085
48,218
23,494
24,724
35.9
22,038
2,686
170
2,516
9.9
2.1
4.4
8.4
376.6
10.6
FY18E
2Q
27,834
14.0
19,362
47,196
22,397
24,798
15.8
21,566
3,232
630
2,602
-27.1
2.1
2.5
9.5
391.6
10.5
FY17
3Q
28,440
17.8
14,363
42,803
22,931
19,872
0.3
16,856
3,016
452
2,563
-20.4
2.3
-1.6
10.8
402.6
0.0
(INR M)
FY18E
Net Interest Income
% Change (Y-o-Y)
Other Income
Net Income
Operating Expenses
Operating Profit
% Change (Y-o-Y)
Other Provisions
Profit before Tax
Tax Provisions
Net Profit
% Change (Y-o-Y)
Operating Parameters
NIM (Cal, %)
Deposit Growth (%)
Loan Growth (%)
Asset Quality
Gross NPA (INR b)
Gross NPA (%)
E: MOSL Estimates
4Q
24,249
98,718
96,996
-10.5
1.1
-1.7
19,264
75,544
77,055
43,513 1,74,262 1,74,051
22,373
85,123
89,490
21,140
89,140
84,560
-28.9
24.7
-5.1
14,875
72,720
59,500
6,265
16,420
25,061
2,030
5,200
8,120
4,235
11,220
16,941
97.7
-139.9
51.0
2.1
-100.0
21.9
0.0
0.0
1.9
3.2
5.3
342.0
9.6
2.0
-100.0
21.9
0.0
0.0
24 January 2018
16

December 2017 Results Preview | Sector: Financials
Capital First
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
CAFL IN
97.4
70 / 1
839 / 569
1 / -3 / -4
23.4
15.3
4.3
43.7
33.4
1.8
15.4
8.0
16.2
2.3
0.5
29.4
19.5
5.5
56.5
29.2
1.9
17.2
7.0
12.6
2.0
0.6
CMP: INR721
TP: INR925 (+28%)
Buy
Financial Snapshot (INR m)
Y/E March
NII
PPP
PAT
EPS (INR)
EPS Gr. (%)
BV/Sh. (INR)
RoA on AUM (%)
RoE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
Div. Yield (%)
28.8
3.0
0.4
21.6
2.7
0.4
2017 2018E 2019E 2020E
12.3
8.1
2.4
24.6
34.2
1.6
12.0
10.6
18.1
11.5
3.2
32.8
33.1
1.7
13.2
9.0
AUM is likely to grow 5% QoQ and 28% YoY, driven by strong festive
demand, and market share gains in the 2W segment.
With margin expansion of 120bp YoY, NII is likely to grow 50% YoY
to INR5b.
Cost-to-income ratio is expected to remain largely stable
sequentially at 52%.
Asset quality is likely to remain stable. We factor in provisions of
INR1.7b, as against INR1.6b in 2QFY18 and INR1.2b in 3QFY17.
Net profit is likely to grow 39% YoY to INR856m.
The stock trades at 2.7x FY18E and 2.3x FY19E BV. Maintain Buy.
234.4 263.7 303.2 355.0
Key issues to watch for
Management commentary on growth trends/demand for loans.
Trend in write-offs and overall credit costs.
Guidance on C/I ratio.
Movement in borrowing costs and margins.
Quarterly Performance
Y/E March
FY17
1Q
2Q
3Q
4Q
1Q
Interest Income
5,539
6,112
6,415
6,549
7,213
Fee Income
679
751
944
1,019
991
Operating Income
6,218
6,863
7,359
7,568
8,204
YoY Growth (%)
56.1
57.6
48.1
35.6
31.9
Interest expenses
2,760
2,961
3,082
2,803
3,065
Net Income
3,458
3,902
4,277
4,766
5,140
YoY Growth (%)
73.1
74.4
63.0
55.8
48.7
Operating Expenses
1,710
2,066
2,103
2,420
2,738
Operating Profit
1,748
1,837
2,174
2,346
2,402
YoY Growth (%)
72.4
67.7
67.6
58.5
37.4
Provisions and Cont.
995
1,032
1,240
1,264
1,408
Profit before Tax
753
805
934
1,082
994
Tax Provisions
262
229
320
363
323
Net Profit
492
576
614
719
672
YoY Growth (%)
48.5
40.3
37.8
51.4
36.6
AUM Growth (%)
36.1
31.8
25.5
23.6
24.4
Borrowings Growth (%)
46.8
42.0
25.0
18.0
25.5
Cost to Income Ratio (%)
49.4
52.9
49.2
50.8
53.3
Tax Rate (%)
34.7
28.5
34.3
33.6
32.4
E: MOSL Estimates; Quarterly and annual numbers may not match due to reporting styles
FY18
2Q
7,928
983
8,911
29.8
3,268
5,643
44.6
2,889
2,754
50.0
1,576
1,178
393
785
36.3
28.1
23.4
51.2
33.4
FY17
3Q
8,404
1,150
9,554
29.8
3,398
6,155
43.9
3,178
2,977
37.0
1,700
1,277
421
856
39.4
28.4
30.3
51.6
33.0
4Q
8,705
1,348
10,053
32.8
3,458
6,595
38.4
3,254
3,341
42.4
2,031
1,310
426
884
22.9
28.2
28.0
49.3
32.5
23,888
4,121
28,009
48.8
11,606
16,403
66.5
8,298
8,104
68.1
4,530
3,575
1,174
2,389
43.8
20.4
18.0
50.6
35.1
(INR m)
FY18
31,266
5,456
36,722
31.1
13,188
23,534
43.5
12,060
11,474
41.6
6,715
4,759
1,563
3,196
33.8
28.0
28.0
51.2
35.1
24 January 2018
17

December 2017 Results Preview | Sector: Logistics
Concor
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
CCRI IN
243.7
333 / 5
1419 / 912
4 / 10 / 19
CMP: INR1,368 TP: INR1,496(9%)
Neutral
Financial snapshot (INR b)
Y/E March
2017 2018E 2019E 2020E
Sales
EBITDA
NP
EPS (INR)
EPS Gr. (%)
BV/Sh (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
Div. Yield (%)
34.9
3.7
25.6
1.3
32.0
3.6
26.1
1.5
24.8
3.4
19.9
1.9
20.1
3.2
16.0
2.4
56.1
12.5
8.6
38.0
-2.6
363.0
10.8
10.5
57.7
64.1
12.7
10.4
42.7
12.4
381.0
11.5
11.2
57.7
73.6
16.6
13.5
55.2
29.3
404.4
14.1
13.7
57.7
86.0
20.5
16.6
68.1
23.2
433.1
16.3
15.9
57.7
We expect CCRI to report net sales of INR14.8b (+12% YoY, +4%
QoQ), led by (a) strong volume growth of +11% YoY and (b) 1% YoY
increase in realizations.
We expect EXIM volumes to improve 11% YoY and expect domestic
volumes to grow 10% YoY.
We estimate EBITDA at INR3.1b (+19% YoY, +10% QoQ) and PAT at
INR2.48b (+34% YoY, +11% QoQ).
The stock trades at FY19E/20E P/E of 24.8x/20.1x and FY19E/20E
EV/EBITDA of 19.9x/16x.
CCRI remains a direct play on the upcoming dedicated freight
corridor (DFC) project, which will multiply its asset turnover and
significantly improve profitability. Maintain Neutral.
Key issues to watch for
EXIM and domestic volumes, and realizations.
Progress on MMLPs and DFC projects.
Container Corporation
Y/E March
Net Sales
YoY Change (%)
EBITDA
Margins (%)
YoY Change (%)
Depreciation
Interest
Other Income
PBT before EO expense
Extra-Ord expense
PBT
Tax
Rate (%)
Adj PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
13,392
-5.7
2,619
19.6
-9.0
841
0
692
2,470
0
2,470
685
27.7
1,785
-13.7
13.3
FY17
2Q
13,603
-9.4
2,274
16.7
-28.1
860
2
763
2,175
0
2,175
596
27.4
1,578
-32.4
11.6
3Q
13,304
-5.3
2,612
19.6
-6.7
927
1
845
2,529
0
2,529
669
26.4
1,860
-9.7
14.0
4Q
15,579
-2.3
4,950
31.8
6.2
877
32
593
4,634
865
3,768
411
10.9
4,223
37.9
27.1
1Q
14,568
8.8
3,267
22.4
24.8
953
0
936
3,251
0
3,251
817
25.1
2,434
36.4
16.7
FY18
2Q
14,302
5.1
2,821
19.7
24.1
969
0
954
2,805
0
2,805
576
20.5
2,229
41.2
15.6
3QE
14,836
11.5
3,102
20.9
18.8
940
9
1,250
3,403
0
3,403
919
27.0
2,484
33.6
16.7
4QE
20,403
31.0
3,462
17.0
-30.1
893
27
1,924
4,466
0
4,466
1,206
27.0
3,260
-22.8
16.0
(INR Million)
FY17
FY18E
56,061
-5.3
12,469
22.2
-6.8
3,518
37
2,892
11,806
0
11,806
2,361
20.0
9,446
-0.7
16.8
64,109
14.4
12,651
19.7
1.5
3,754
37
5,064
13,924
0
13,924
3,517
25.3
10,407
10.2
16.2
24 January 2018
18

December 2017 Results Preview | Sector: Telecom
Idea Cellular
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
IDEA IN
3600.5
369 / 6
124 / 67
7 / 12 / 13
CMP: INR103
TP: INR120 (+17%)
Buy
We expect consolidated revenue to decline 11.2% QoQ (and
23.5% YoY) to INR66.3b.
We expect ARPU to decline 11% QoQ (and 26% YoY) to INR116.
EBITDA margin is expected to contract ~210bp QoQ/7pp YoY to
18% due to plunge in revenue.
We expect Idea’s net loss to widen to INR13.9b v/s INR 11.1b in
2QFY18.
Idea trades at an EV/EBITDA of 15.7x FY18E and 14.7x FY19E.
Maintain Buy.
Financial Snapshot (INR Million)
Y/E March
2017 2018E 2019E 2020E
Net Sales
EBITDA
Adj. NP
AdjEPS (INR)
Adj.EPSGr(%)
BV/Sh(INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA(x)
Div. Yield (%)
-92.5
1.5
8.3
0.0
-7.8
1.9
15.7
0.0
-7.9
2.4
14.7
0.0
-9.5
3.2
11.3
0.0
355.8 289.6 296.6 331.2
102.8
-4.0
-1.1
57.5
-47.6
63.2
-46.5
-12.9
-2.3
42.5
-26.4
-2.2
0.0
82.1
-38.7
-10.8
-16.6
32.5
-28.7
-1.2
0.0
-13.2
-116.2 1,091.
6
68.6 55.4
-1.7
1.6
0.0
-21.3
-2.4
0.0
Key monitorables
Consolidated revenue (expect 11.2% decline QoQ).
Blended ARPU (we expect INR116, 11% QoQ fall).
EBITDA margin (we expect 210bp contraction QoQ).
Consolidated - Quarterly Earning Model
Y/E March
Revenue from operations
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Share in Profits from Associates
Net Finance Costs
PBT before EO expense
PBT
Tax
Rate (%)
MI & Profit/Loss of Asso. Cos.
Reported PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
94,866
7.9
63,917
30,949
32.6
19,192
1,035
9,431
3,361
3,361
1,158
34.5
0
2,203
-74.2
2.3
FY17
2Q
93,002
7.0
64,601
28,401
30.5
19,543
1,057
8,753
1,162
1,162
247
21.3
0
915
-88.7
1.0
3Q
86,627
-3.9
64,973
21,655
25.0
19,653
1,143
9,232
-6,087
-6,087
-2,248
36.9
0
-3,839
-150.2
-4.4
4Q
81,261
-14.3
60,062
21,199
26.1
19,885
983
9,366
-7,069
-7,069
-3,792
53.6
0
-3,277
-156.9
-4.0
1Q
81,665
-13.9
62,911
18,754
23.0
20,679
818
11,539
-12,646
-12,646
-4,497
35.6
0
-8,149
-469.9
-10.0
FY18
2Q
3QE
74,655 66,304
-19.7
-23.5
59,639 54,355
15,016 11,949
20.1
18.0
21,143 21,816
843
860
11,829 11,749
-17,113 -20,757
-17,113 -20,757
-6,047
-6,850
35.3
33.0
0
0
-11,066 -13,907
-1,309.9
262.3
-14.8
-21.0
FY17
(INR m)
FY18E
4QE
66,973 3,55,758 2,89,597
-17.6
12.7
-18.6
55,217 2,52,995 2,32,122
11,756 1,02,763 57,475
17.6
28.9
19.8
22,537 78,272 86,175
877
4,218
3,398
11,749 37,342 46,867
-21,653
-8,633 -72,169
-21,653
-8,633 -72,169
-7,145
-4,636 -24,539
33.0
53.7
34.0
0
0
0
-14,507
-3,997 -47,629
342.7
-117.3 1,091.6
-21.7
-1.1
-16.4
24 January 2018
19

December 2017 Results Preview | Sector: Aviation
InterGlobe Aviation
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
INDIGO IN
383.9
464 / 7
1346 / 816
4 / -7 / 20
CMP: INR1,208 TP: INR1,306 (+8%)
Neutral
1,6,12 Rel Perf. (%)
We expect INDIGO to report revenue of INR60.4b in 3QFY18
(+21% YoY, 14% QoQ) and EBITDAR of INR18.4b (+28% YoY, 18%
QoQ).
We model ticket yield at INR3.73 (+7.1% YoY, +4.4% QoQ) and
RPK at 14.2b (+13.3% YoY). Any deviation in yield would have a
meaningful impact on our estimates.
We model ATF at INR56.5/liter (+12.6% YoY, +12.9% QoQ) for
3QFY18 and expect INDIGO to report net profit of INR6.5b.
We model ASK at 64b/77b/92b in FY18/FY19/FY20 v/s 54b in
FY17, and RPK at 55b/68b/81b in FY18/FY19/FY20 v/s 46.3b in
FY17, driven by an increase in fleet size.
The stock trades at 15.9x FY19E EPS of INR76 and at an EV of 8.7x
FY19E adjusted EBITDAR. Maintain
Neutral.
Financial Snapshot (INR Billion)
Y/E March
2017 2018E 2019E 2020E
Sales
EBITDA
NP
EPS (INR)
EPS Gr. (%)
BV/Sh (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
Adj.EV/EBITDAR(x)
Div. Yield (%)
27.9 19.2
12.3
12.5
2.6
6.9
9.3
3.7
15.9
6.4
8.7
4.4
10.9
5.9
7.2
6.4
185.8 233.3 289.9 348.3
21.4 33.9
16.6 24.2
43.2 63.1
-16.6 45.9
51.0 46.1
31.4 35.6
89.1 83.3
35.8
29.2
20.5
41.9
45.7
83.3
50.7
42.5
76.0 110.6
45.6
56.2
63.5
83.3
98.5 174.9 187.6 206.0
Key issues to watch for
Induction of new aircraft in the fleet.
Fuel costs and their impact on yields.
Quarterly performance
Y/E March
Net Sales
YoY Change (%)
Fuel cost
Employee cost
Other expenses
Total Expenditure
EBITDAR
Margins (%)
Net Rentals
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Reported PAT
EPS
YoY Change (%)
E: MOSL Estimates
1Q
45,789
8.7
13,674
4,789
12,046
30,509
15,279
33
7,127
8,152
17.8
1,148
1,163
1,626
7,467
1,549
20.7
5,918
15.4
-8.8
FY17
2Q
41,669
17.7
15,524
5,080
11,388
31,992
9,677
23
7,721
1,956
4.7
1,189
610
1,608
1,765
367
20.8
1,398
3.6
24.1
3Q
49,865
16.0
16,712
5,273
13,471
35,457
14,409
29
8,164
6,245
12.5
1,184
759
1,719
6,022
1,149
19.1
4,873
12.7
-25.9
4Q
48,482
18.5
17,734
5,339
12,087
35,160
13,322
27
8,242
5,080
10.5
1,052
777
2,938
6,190
1,786
28.9
4,403
11.5
-24.0
1Q
57,529
25.6
17,929
5,843
14,250
38,022
19,507
34
8,537
10,970
19.1
983
770
2,026
11,243
3,132
27.9
8,111
21.1
37.1
FY18
2Q
52,910
27.0
16,781
6,004
14,550
37,335
15,574
29
8,193
7,382
14.0
1,025
857
2,146
7,645
2,130
27.9
5,516
14.4
294.5
(INR Million)
FY17
FY18E
3QE
60,418
21.2
20,579
6,466
14,976
42,021
18,397
30
9,009
9,389
15.5
1,243
770
1,805
9,181
2,662
29.0
6,518
17.0
33.8
4QE
62,442
28.8
22,911
7,140
16,294
46,345
16,096
26
9,947
6,150
9.8
1,178
619
1,365
5,716
1,658
29.0
4,059
10.6
-7.8
185,805
15.1
63,644
20,482
48,992
133,118
52,687
28
31,254
21,433
11.5
4,573
3,308
7,891
21,443
4,852
22.6
16,592
43.2
-17.0
233,299
25.6
78,200
78,200
60,070
163,723
69,575
30
35,686
33,890
14.5
4,430
3,016
7,342
33,786
9,582
28.4
24,204
63.1
45.9
24 January 2018
20

December 2017 Results Preview | Sector: Technology
KPIT Technologies
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
KPIT IN
200.2
38 / 1
192 / 105
15 / 45 / 13
CMP: INR190
TP: INR160 (-16%)
Neutral
Financial Snapshot (INR b)
Y/E Mar
2017 2018E 2019E 2020E
Sales
EBITDA
PAT
EPS (INR)
EPS Gr. (%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
Div yld (%)
15.9
2.4
9.6
1.1
16.2
2.1
9.0
1.1
14.2
1.8
7.2
1.1
11.0
1.6
6.2
1.1
33.2
3.5
2.1
11.9
-15.3
79.2
14.3
15.9
16.8
36.4
3.6
2.3
11.7
-1.8
13.9
15.3
17.1
39.4
4.2
2.7
13.3
13.8
13.8
16.6
15.0
42.9
4.5
3.5
17.2
29.0
15.4
18.8
11.6
89.7 103.1 120.3
Given the strong start to FY18, and keeping in mind the seasonal
weakness it typically witnesses, we expect revenues for KPIT at
USD141m, a decline of 0.7% QoQ in 3Q.
Despite the weakness, KPIT would be able to clock double-digit
growth this year, thanks to an acquisition and robust numbers in
4QFY17 and 1QFY18.
Profitability expectations are moderate; we expect flat margins,
as seasonal weakness restricts any uptick.
Our PAT estimate of INR500m, -17.1% QoQ, is a function of
revenue decline and lower other income.
KPIT trades at 14.2x FY19E and 11.0x FY20E earnings. Maintain
Neutral.
Key issues to watch for
Growth in IES, Engineering Services and top client.
Commentary on deal wins across segments.
Plan to recoup profitability.
Quarterly Performance (Indian GAAP)
Y/E March
1Q
Revenue (USD m)
120
QoQ (%)
-3.5
Revenue (INR m)
8,032
YoY (%)
5.9
GPM (%)
28.9
SGA (%)
18.3
EBITDA
855
EBITDA Margin (%)
10.7
EBIT Margin (%)
8.3
Other income
116
Interest
56
ETR (%)
24.3
PAT
551
QoQ (%)
-37.8
YoY (%)
24.0
EPS (INR)
2.8
Headcount
11,288
Util excl. trainees (%)
68.1
Offshore rev. (%)
41.5
Fixed Price (%)
28.5
E: MOSL Estimates
FY17
2Q
3Q
123
123
3.0
-0.4
8,310
8,307
2.3
2.2
29.5
29.0
18.5
18.8
914
846
11.0
10.2
8.6
7.9
49
29
14
66
25.1
23.1
562
475
2.0
-15.5
-25.2
-35.4
2.8
3.7
11,666
11,881
69.2
67.8
43.2
43.0
28.0
33.7
4Q
128
4.4
8,585
2.1
29.2
19.0
870
10.1
7.3
12
0
15.3
537
13.1
-39.3
2.7
12,110
68.3
43.0
35.8
1Q
134
4.8
8,704
8.4
26.6
17.6
788
9.1
6.9
121
26
23.4
555
3.3
0.9
2.8
12,261
68.8
43.9
34.8
FY18E
2Q
3QE
142
141
5.7
-0.7
9,160
9,129
10.2
9.9
28.1
28.1
18.2
18.2
902
901
9.9
9.9
7.8
7.7
114
-13
26
25
24.4
25.0
603
500
8.7
-17.1
7.4
5.4
3.0
2.5
11,946
12,455
70.2
72.0
42.3
43.1
36.2
FY17
4QE
143
1.6
9,386
9.3
28.5
17.8
1,005
10.7
8.6
143
23
25.0
693
38.5
29.0
3.4
12,514
73.0
43.2
494
0.8
33,234
3.1
29.1
18.7
3,486
10.5
8.0
207
136
22.2
2,125
-24.5
11.9
12,110
68.3
42.7
(INR m)
FY18E
561
13.4
36,379
9.5
27.8
18.0
3,603
9.9
7.8
365
99
24.5
2,352
10.7
11.7
12,514
71.0
43.1
24 January 2018
21

December 2017 Results Preview | Sector: Technology
L&T Infotech
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
LTI IN
175.0
201 / 3
1229 / 653
10 / 36 / 42
CMP: INR1148
TP: INR1200 (5%)
Buy
Financial Snapshot (INR b)
y/e march
2017 2018E 2019E 2020E
Sales
EBITDA
PAT
EPS (INR)
EPS Gr. (%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuation
P/E (x)
P/BV (x)
EV/EBITDA (x)
Div Yld (%)
20.7
6.4
15.3
1.4
17.5
5.0
15.9
1.1
16.3
4.1
13.6
1.2
13.9
3.3
11.4
1.4
65.0
12.3
9.7
55.5
5.9
179.7
37.6
40.3
29.7
71.2
12.0
11.5
65.6
18.2
229.5
32.1
29.7
20.0
81.3
13.8
12.3
70.4
7.3
283.0
27.5
29.4
20.0
92.5
16.0
14.4
82.3
17.0
345.5
26.2
28.2
20.0
LTI witnessed strong growth throughout FY17, led by sustained
ramp-up of deals. Although growth has been as strong in 1HFY18,
the company expects a stronger 2HFY18.
Visibility for this revival comes from the ramp-up schedule of
recent deal wins and visibility lent by new deal wins.
We thus expect 3QFY18 to be strong despite seasonal weakness
at 3.2% QoQ growth in USD terms.
We expect EBITDA margin to remain steady at 16.8%, as the
company reinvests any gains in developing capabilities and
augments its sales function.
Our PAT estimate for the quarter is INR2.7b, which is lower
sequentially by 1.8%. Top-line growth is likely to be offset by
lower other income on account of lower hedge gains and
translation losses.
The stock trades at 16.3x FY19E and 13.9x FY20E earnings. Buy.
Key issues to watch for
Deal wins and visibility on continuity of traction next year.
Outlook on top clients and their contribution to growth.
Growth in Digital.
Quarterly Performance
Y/E March
Revenue (USD m)
QoQ (%)
Revenue (INR m)
YoY (%)
GPM (%)
SGA (%)
EBITDA
EBITDA Margin (%)
EBIT Margin (%)
Other income
ETR (%)
PAT
QoQ (%)
YoY (%)
EPS (INR)
Headcount
Util incl. trainees (%)
Attrition (%)
Offshore rev. (%)
E: MOSL Estimates
1Q
231
0.6
15,550
16.6
35.3
15.7
3,050
19.6
16.9
372
21.2
2,359
3.2
35.1
13.5
19,292
77.4
19.5
51.9
FY17
2Q
240
3.7
16,020
9.1
35.4
16.4
3,044
19.0
16.1
365
21.0
2,326
-1.4
21.3
13.3
21,074
78.7
18.5
51.2
3Q
245
2.3
16,667
12.1
34.3
16.2
3,020
18.1
15.3
597
21.2
2,481
6.7
10.5
14.2
20,605
78.1
18.1
52.3
4Q
254
3.7
16,772
7.7
35.8
16.8
3,190
19.0
16.5
503
22.3
2,547
2.7
11.4
14.6
21,023
78.3
16.9
51.3
1Q
259
2.0
16,707
7.4
33.8
17.0
2,799
16.8
14.4
1,084
23.4
2,673
4.9
13.3
15.3
22,321
77.7
14.7
53.2
FY18E
2Q
3QE
271
279
4.4
3.2
17,508
18,082
9.3
8.5
33.9
33.5
17.1
16.7
2,942
3,030
16.8
16.8
14.5
15.2
1,017
748
23.2
23.4
2,729
2,679
2.1
-1.8
17.3
8.0
15.6
15.3
22,554
23,124
79.6
80.0
15.0
53.4
53.0
FY17
4QE
288
3.1
18,855
12.4
33.8
16.7
3,216
17.1
15.6
1,499
23.4
3,397
26.8
33.4
19.4
23,794
80.0
53.0
970
9.3
65,009
11.2
35.2
16.3
12,303
18.9
16.2
1,837
21.4
9,711
5.9
55.5
21,023
7807.5
48.3
(INR m)
FY18E
1,097
13.1
71,152
9.4
33.7
16.9
11,986
16.8
14.9
4,348
23.3
11,478
18.2
65.6
23,794
79.4
53.2
24 January 2018
22

December 2017 Results Preview | Sector: Financials
Mahindra Financial Ser.
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
MMFS IN
614.0
285 / 4
489 / 264
2 / 25 / 44
47.6
29.5
11.5
18.7
55.7
34.6
14.2
23.1
CMP: INR464
TP: INR562 (+21%)
Buy
Financial Snapshot (INR b)
Y/E March
NII
PPP
PAT
EPS (INR)
BV/Sh.(INR)
ABV/Sh (INR)
RoA on AUM (%)
RoE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
P/ABV (x)
Div. Yield (%)
66.4
4.1
5.0
0.6
34.8
3.2
3.9
1.0
25.2
3.0
3.5
1.4
20.3
2.7
3.2
1.7
2017 2018E 2019E 2020E
33.2
19.3
4.0
7.1
40.6
25.0
8.3
13.5
114.6 147.9 158.9 172.6
94.8 120.7 132.7 146.6
1.0
6.4
39.2
1.8
10.7
41.0
2.1
12.2
41.0
2.2
13.9
41.0
There has been good traction in vehicle sales in the quarter,
which should translate into 14% YoY AUM growth in the quarter.
Margins are expected to increase over 100bp, off a low base. As a
result, we expect 35% NII growth in the quarter.
With 17% growth in operating expenses, PPoP growth should be
in excess of 50% YoY.
GNPL ratio is likely to remain stable.
We factor in INR2.2b provisions in 3QFY18 v/s INR4.5b in 2QFY18
and INR4.2b in 3QFY17.
We have not factored in stake sale gain of INR___m into our
estimates.
The stock trades at 3.2x FY18E and 3.0x FY19E BV. Maintain Buy.
Key issues to watch for
Management commentary on performance of rural areas.
Commentary on pick-up in the CV cycle.
Asset quality trend in the wake of good monsoons.
Margin and growth trends.
Performance of subsidiaries.
Quarterly Performance
Y/E March
Operating Income
Other Income
Total income
YoY Growth (%)
Interest Expenses
Net Income
YoY Growth (%)
Operating Expenses
Operating Profit
YoY Growth (%)
Provisions
Profit before Tax
Tax Provisions
Net Profit
YoY Growth (%)
AUM growth (%)
Borrowings growth (%)
Cost to Income Ratio (%)
Tax Rate (%)
E: MOSL Estimates
1Q
13,664
93
13,757
0.5
6,910
6,847
-5.4
3,260
3,587
-22.1
2,245
1,341
472
870
-2.2
10.0
11.1
47.6
35.2
FY17
2Q
14,916
241
15,157
5.4
7,086
8,071
2.9
3,567
4,504
-10.5
3,042
1,462
514
948
-35.1
14.0
16.4
44.2
35.2
3Q
14,904
130
15,035
6.7
7,441
7,593
2.7
3,645
3,949
-11.2
4,190
-241
-85
-156
-123.3
12.9
15.8
48.0
35.2
4Q
18,255
173
18,427
9.1
7,137
11,290
10.8
4,037
7,252
6.7
3,614
3,638
1,298
2,341
-36.8
13.9
17.8
35.8
35.7
1Q
15,924
107
16,031
16.5
7,327
8,704
27.1
3,810
4,894
36.5
4,258
636
162
474
-45.5
13.9
17.8
43.8
25.5
FY18
2Q
3Q
16,608
17,698
221
240
16,829
17,938
11.0
19.3
7,498
7,705
9,331
10,233
15.6
34.8
3,694
4,214
5,636
6,019
25.1
52.4
4,446
2,200
1,190
3,819
410
1,317
780
2,501
-17.7 -1,699.5
13.8
14.2
16.1
15.6
39.6
41.2
34.5
34.5
FY17
4Q
20,561
259
20,820
13.0
7,685
13,135
16.3
4,651
8,484
17.0
1,530
6,954
2,425
4,529
93.5
16.3
11.3
35.4
34.9
61,739
636
62,375
5.6
28,574
33,801
3.5
14,509
19,292
-7.6
13,091
6,202
2,198
4,003
-40.5
0.0
13.9
42.9
35.4
(INR m)
FY18
70,790
827
71,617
14.8
30,215
41,402
22.5
16,369
25,033
29.8
12,434
12,600
4,315
8,285
107.0
0.0
8.0
39.5
34.2
24 January 2018
23

December 2017 Results Preview | Sector: Technology
Mphasis
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
MPHL IN
210.2
154 / 2
774 / 517
-1 / 13 / 5
CMP: INR733
TP: INR670 (-8%)
Neutral
Financial Snapshot (INR b)
Y/E Mar
2017 2018E 2019E 2020E
Sales
EBITDA
PAT
EPS (INR)
EPS Gr. (%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA(x)
Div yld (%)
60.8
9.7
8.2
38.9
12.9
292.4
13.2
12.4
43.7
18.8
2.5
13.1
2.3
64.7
9.9
8.1
41.9
7.6
255.5
14.6
14.0
52.6
17.5
2.9
12.6
3.0
70.3
10.4
8.5
43.9
4.9
272.9
16.6
16.1
50.1
16.7
2.7
11.9
3.0
77.5
12.0
9.5
49.5
12.7
292.4
17.5
17.3
50.5
14.8
2.5
10.1
3.4
The HP channel has seen five consecutive quarters of steady
performance. We expect this trend to continue in 3QFY18 as well.
However, seasonal weakness and flattish revenue in Digital Risk
are expected to partly offset this, and result in moderation of
growth.
We expect CC revenue growth of 1.6% QoQ and cross-currency
tailwinds of 20bp, leading to USD revenue growth of 1.8% QoQ.
The company is on an improving trajectory on a YoY basis, as
growth would improve to 10.4% YoY in 3QFY18 from -2.4% YoY in
3QFY17.
We expect EBIT margin to shrink by 40bp to the lower end of its
guided band of 14-16%.
Our PAT estimate is INR2b (+1.6% QoQ). Higher PAT is led by
lower margins and translation losses.
The stock trades at 16.7x FY19E and 14.8x FY20E EPS. Neutral.
Key issues to watch for
Outlook for Digital Risk given an interest rate cycle reversal.
Strategy changes and roadmap under the new leadership.
Top customer outlook and consequent impact on the Direct
International channel.
Quarterly Performance
Y/E March
Revenue (USD m)
QoQ (%)
Revenue (INR m)
YoY (%)
GPM (%)
SGA (%)
EBITDA
EBITDA Margin (%)
EBIT Margin (%)
Other income
ETR (%)
PAT
QoQ (%)
YoY (%)
EPS (INR)
Headcount
Net Additions
HP Channel rev. (%)
Fixed Price (%)
E: MOSL Estimates
1Q
224
-0.3
15,167
1.5
28.1
12.0
2,445
16.1
15.2
572
27.7
2,043
6.4
23.2
9.7
22,374
50
23.4
19.8
FY17
2Q
3Q
224
224
-0.2
-0.3
15,176
15,361
-2.6
1.3
28.1
27.8
11.8
12.3
2,463
2,396
16.2
15.6
15.3
14.7
711
617
27.5
28.5
2,166
2,044
6.0
-5.6
14.0
17.7
10.3
9.7
22,284
22,018
-90
-266
23.9
24.0
19.1
20.6
4Q
222
-0.9
15,059
-0.7
28.7
12.8
2,384
15.8
14.6
485
27.5
1,934
-5.4
0.7
8.8
21,979
-39
24.4
19.3
1Q
231
4.2
15,360
1.3
27.3
12.4
2,295
14.9
13.8
469
26.9
1,872
-3.2
-8.4
9.1
21,878
-101
25.8
21.3
FY18E
2Q
242
4.9
16,047
5.7
27.5
12.1
2,493
15.5
14.4
375
25.4
1,977
5.6
-8.7
10.2
22,183
305
26.1
22.6
FY17
3QE
247
1.8
16,297
6.1
26.5
11.4
2,471
15.2
14.0
459
26.0
2,009
1.6
-1.7
10.4
21,284
-899
4QE
254
3.1
17,021
13.0
27.7
12.1
2,656
15.6
14.5
586
26.5
2,224
10.7
15.0
11.5
21,814
530
894
-3.5
60,763
-0.2
28.2
12.2
9,688
15.9
15.0
2,385
27.8
8,188
13.0
38.5
21,979
-345
(INR m)
FY18E
974
9.0
64,725
6.5
27.3
12.0
9,915
15.3
14.2
1,889
26.2
8,082
-1.3
41.9
21,814
-165
24 January 2018
24

December 2017 Results Preview | Sector: Media
Music Broadcast Ltd
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
RADIOCIT IN
57.1
22 / 0
420 / 333
-3 / -3 / -
CMP: INR377
TP: INR469 (+24%)
Buy
Financial Snapshot (INR Billion)
Y/E March
2017 2018E 2019E 2020E
Sales
EBITDA
Adj. NP
Adj. EPS (INR)
Adj.EPS Gr (%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
58.7
3.9
22.3
46.6
3.6
21.0
26.7
3.2
14.1
21.2
2.8
10.9
2.7
0.9
0.4
6.4
-31.6
11.2
8.8
3.0
0.9
0.5
8.1
26.0
8.1
8.4
3.6
1.3
0.8
14.1
74.5
12.7
12.5
4.1
1.6
1.0
17.8
26.2
14.0
14.0
We expect revenue to grow 5% YoY to INR762m, impacted by
GST.
EBITDA is expected to rise 2% YoY to INR272m; margin is likely to
decline 80bp YoY to 35.8%.
We expect PAT to grow 17% YoY to INR141m, led by lower net
finance cost.
The stock trades at EV/EBITDA of 21.0x FY18E and 14.1x FY19E.
Maintain Buy.
96.1 104.2 118.3 136.1
Key things to watch for
Growth in advertisement revenue in new and old stations.
Standalone - 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 (%)
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
628
38.0
437
192
30.5
45
41
11
116
0
116
40
34.5
76
76
-27.5
12.1
FY17
2Q
692
24.7
403
289
41.7
45
41
8
211
0
211
68
32.2
143
116
7.3
16.7
3Q
728
12.3
462
266
36.6
50
50
9
175
0
175
54
30.9
121
121
-43.9
16.6
4Q
666
12.7
500
166
24.9
56
59
17
68
0
68
23
33.3
45
45
-75.7
6.8
1Q
703
11.9
481
222
31.5
64
39
47
166
0
166
57
34.6
108
108
42.3
15.4
FY18
2Q
758
9.5
516
242
31.9
67
38
50
187
0
187
60
32.0
127
127
9.9
16.8
FY17
3QE
762
4.7
489
272
35.8
63
40
47
216
0
216
75
34.6
141
141
17.0
18.5
4QE
736
10.5
549
186
25.3
63
40
47
130
0
130
45
34.6
85
85
88.6
11.5
2,714
20.7
1,802
913
33.6
197
190
44
570
0
570
203
35.7
367
367
32.7
13.5
FY18E
2,959
9.0
2,036
923
31.2
257
157
191
699
0
699
237
33.9
462
462
26.0
15.6
24 January 2018
25

December 2017 Results Preview | Consumer
Pidilite Industries
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
PIDI IN
512.7
467 / 7
972 / 599
4 / 3 / 23
CMP: INR911
TP: INR1,044 (+15%)
Buy
We expect Pidilite’s (PIDI) revenue to grow by 14% YoY, led by
15% volume growth in Consumer and Bazaar segment.
EBITDA margin is expected to expand 50bp YoY to 22%.
We expect EBITDA and PAT to grow by 16.7% and 7.5% YoY to
INR3.3b and INR2.2b, respectively.
The stock trades at 43.8x/37.9x FY19E/20E EPS of INR20.8/INR24.
Maintain
Buy.
Financial Snapshot (INR b)
Y/E March
2017 2018E 2019E 2020E
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 (%)
54.4
14.1
36.3
0.5
52.9
11.6
34.5
0.3
43.8
9.5
28.8
0.3
37.9
7.9
24.5
0.3
56.2
12.6
8.6
16.7
6.7
64.5
28.2
26.8
29.2
59.9
13.1
8.8
17.2
2.9
78.2
24.1
23.1
17.4
71.5
15.5
10.7
20.8
20.7
23.9
23.1
14.4
82.9
17.9
12.3
24.0
15.5
22.7
22.1
12.5
95.5 116.0
Key issues to watch for
Volume growth in Fevicol.
Outlook for VAM prices.
Outlook for industrial and construction chemical segments.
Consolidated - Quarterly Earning Model
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Adj PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
15,694
6.8
11,754
3,939
25.1
258
35
241
3,887
1,174
30.2
2,713
16.3
17.3
FY17
2Q
3Q
4Q
14,177 13,344 12,954
7.5
-0.3
4.9
10,963 10,477 10,375
3,214 2,866 2,579
22.7
21.5
19.9
303
295
296
26
30
48
324
272
286
3,209 2,814 2,520
912
793
971
28.4
28.2
38.5
2,297 2,020 1,549
11.9
1.5
-7.5
16.2
15.1
12.0
1Q
15,203
-3.1
11,994
3,210
21.1
313
37
432
3,292
1,033
31.4
2,260
-16.7
14.9
FY18
2Q
3QE
4QE
15,299 15,212 14,177
7.9
14.0
9.4
11,538 11,868 11,404
3,761 3,343 2,772
24.6
22.0
19.6
296
325
331
39
37
36
337
272
262
3,763 3,254 2,667
1,245 1,025
850
33.1
31.5
31.9
2,518 2,229 1,817
9.6
10.3
17.3
16.5
14.7
12.8
FY17
56,168
4.8
43,570
12,598
22.4
1,151
139
1,123
12,430
3,851
31.0
8,579
6.7
15.3
FY18E
59,890
6.6
46,804
13,086
21.9
1,264
149
1,303
12,976
4,152
32.0
8,824
2.9
14.7
24 January 2018
26

December 2017 Results Preview | Sector: Staffing
Quess Corp
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
QUESS IN
137.7
113 / 2
1068 / 516
0 / 9 / 24
CMP: INR824
TP: INR1170 (+3%)
Buy
We expect revenue of INR14.4b for Quess in 3QFY18, signifying a
growth of 40% YoY.
Much of the growth is being contributed to by the integration of
Manipal Integrated Services and Vedang Cellular. Excluding these
two, growth is expected to be 25% YoY.
Growth is also bumped up on a YoY basis because of the
integration of Comtel, which happened in 4QFY17, excluding
which we expect growth to be 15% YoY.
EBITDA margins at 5.5% are expected to be higher by 30bp YoY
because Manipal Integrated Services is margin accretive.
Our PAT estimate is INR503m up 62.1% YoY.
Financial Snapshot (INR Billion)
INR million
FY17 FY18E FY19E FY20E
Sales
EBITDA
NP
EPS (Rs)
EPS Growth (%)
BV/Share (Rs)
P/E (x)
P/BV (x)
EV/EBITDA (x)
EV/Sales (x)
RoE (%)
RoCE (%)
41.6
2.2
1.1
9.1
343.1
95.1
11.7
50.3
2.7
19.0
12.6
56.9
3.3
3.1
23.0
78.1
5.4
3.7
27.1
90.1
6.3
4.6
34.3
53.7 227.7 197.9
37.5
4.8
34.6
2.0
21.8
16.6
31.9
4.1
21.1
1.4
16.6
14.5
25.2
3.4
17.3
1.2
17.6
16.0
73.8 179.4 211.8 252.7
Key things to watch for
Integration of recently acquired entities
Restructuring of operations in the Industrials segment
Organic growth momentum, and traction in the general staffing
business post GST
Consolidated - 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 (%)
Minority Interest & P/L of Asso. Cos.
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
9,910
35.7
9,382
528
5.3
60
92
7
382
0
382
135
35.4
0
247
247
37.1
2.5
FY17
2Q
3Q
10,177 10,266
26.9
13.3
9,626
9,703
551
563
5.4
5.5
69
69
98
121
57
60
441
432
0
0
441
432
140
126
31.7
29.2
0
-4
301
311
301
311
65.9
80.0
3.0
3.0
4Q
11,221
12.6
10,634
586
5.2
65
153
29
396
0
396
116
29.4
3
277
277
-20.9
2.5
1Q
11,881
19.9
11,246
635
5.3
67
161
34
441
0
441
115
26.2
-6
331
331
34.1
2.8
FY18
2Q
3QE
12,740 14,404
25.2
40.3
12,075 13,612
665
792
5.2
5.5
74
98
151
40
167
119
606
774
0
0
606
774
-802
269
-132.3
34.8
2
2
1,406
503
1,406
503
366.8
62.1
11.0
3.5
FY17
4QE
17,898
59.5
16,728
1,169
6.5
98
40
119
1,151
0
1,151
269
23.4
2
880
880
217.9
4.9
41,574
21.0
39,346
2,228
5.4
263
465
153
1,652
0
1,652
518
31.3
-1
1,136
1,136
28.4
2.7
(INR m)
FY18E
56,922
36.9
53,661
3,261
5.7
337
392
440
2,972
0
2,972
-149
-5.0
0
3,120
3,120
174.8
5.5
24 January 2018
27

December 2017 Results Preview | Sector: Media
SITI Cable
Bloomberg
Equity Shares (m)
M. Cap. (INR b)/(USD b)
52-Week Range (INR)
1,6,12 Rel Perf. (%)
SITINET IN
872.0
23 / 0
41 / 23
-3 / -15 / -57
CMP: INR25
TP: INR27 (+5%)
Neutral
Financial Snapshot (INR Billion)
Y/E MARCH
2017 2018E 2019E 2020E
Net Sales
EBITDA
Adj. Net Profit
Adj. EPS (INR)
Adj. EPS Gr. (%)
BV/Sh (INR)
RoE (%)
RoCE (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
NM
4.1
17.0
NM
4.8
10.4
NM
4.7
7.9
39.1
4.2
6.6
11.9
2.0
-1.6
-1.9
NM
6.2
-29.4
-0.8
15.1
3.7
-0.7
-0.8
NM
5.3
-14.2
8.7
17.4
4.9
0.1
0.1
5.4
2.4
3.7
19.9
5.9
0.6
0.6
6.1
11.3
7.7
LP 411.6
We expect cable subscription revenue to grow 7% QoQ to INR2.2b,
with the monetization opportunities in Phase III/IV. Carriage &
placement revenue would remain flat QoQ at INR0.7b.
We have factored in set-top box seeding of ~0.8m, which should
help activation revenue to grow 2% QoQ to INR0.4b.
SITI’s aggregate revenue is likely to grow 5.5% QoQ to INR3.7b.
We expect EBITDA to reach INR0.8b (+21% QoQ) and margin to
expand 280bp QoQ to 21.8%.
We estimate net loss to narrow to INR187m (from INR657m in
2QFY18).
The stock trades at 10.4x FY18E and 7.9x FY19E EBITDA. Maintain
Neutral.
Key things to watch for
Subscription revenue (we expect 7% QoQ growth).
EBITDA margin (we expect 21.8%).
Consolidated - Quarterly Earning Model
Y/E March
Revenue from Operations
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT before EO expense
Extra-Ord expense
PBT
Tax
Rate (%)
MI & P/L of Asso. Cos.
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
2,820
22.7
2,395
425
15.1
547
297
49
-370
0
-370
65
-17.7
101
-536
-536
NM
-19.0
FY17
2Q
3Q
2,890
2,985
23.6
-13.2
2,416
2,434
473
550
16.4
18.4
572
625
280
360
24
71
-355
-364
0
0
-355
-364
22
-30
-6.1
8.1
93
-71
-469
-263
-469
-263
NM
NM
-16.2
-8.8
4Q
3,255
-4.0
2,676
580
17.8
667
338
115
-310
202
-513
135
-26.4
-31
-617
-361
NM
-11.1
1Q
3,650
29.4
2,639
1,010
27.7
726
331
62
15
0
15
167
1,143.5
137
-290
-290
NM
-7.9
FY18
2Q
3QE
3,523
3,717
21.9
24.5
2,851
2,905
672
812
19.1
21.8
792
695
371
320
40
20
-452
-182
47
0
-499
-182
16
15
-3.2
-8.2
142
-10
-657
-187
-608
-187
NM
NM
-17.3
-5.0
4QE
4,217
29.5
3,041
1,176
27.9
566
256
20
374
0
374
4
1.1
-8
378
378
NM
9.0
FY17
11,949
4.2
9,921
2,028
17.0
2,412
1,274
259
-1,399
202
-1,602
193
-12.0
91
-1,885
-1,629
NM
-13.6
FY18
15,106
26.4
11,436
3,670
24.3
2,779
1,279
142
-246
47
-293
202
-69.1
261
-756
-707
NM
-4.7
24 January 2018
28

In conversation
1. SBI: Expect PSU recap bond allocation to happen before the
budget; Rajnish Kumar, Chairman
Project pipeline is still not as strong as one would like to see and the project
finance growth has not picked up pace as expected.
The corporates are now gradually coming out of deleveraging problems.
With respect to 12 large NCLT cases from the first list, the decision is likely by
end-March, mid-April. IBC has made debt resolution a time bound process.
Consumer loans are growing at a good pace but corporate credit growth is still
muted. However, one is seeing a big turnaround in steel sector and it is seeing a
lot of interest as per the references sent to NCLT.
PSU recapitalisation bond allocation will happen before the Budget.
2. HAVELLS INDIA: Expect higher growth in next quarter; Anil Rai
Gupta, CMD
Entering into the season with a lot of positive hope. 25-26 percent growth is a
very decent growth. Expecting a decent growth in the coming quarters with new
product additions of water heaters, appliances which are doing very well. Fans
are doing very well.
Quite hopeful that company will see decent growth in the coming quarters.
Expecting a decent growth in the cables business. Goods and services tax (GST)
was high at 28 percent, thankfully the government decided to bring it down to
the pre-GST rates of 18 percent which is a big boost to the cables and wires
segment. In the coming quarters should be seeing decent growth in the cables
and wires business.
GST has been a big boon to the organised manufacturers, also to the consumers
because a lot of cost inefficiency which was there in the system of taxes is being
passed on to the consumers.
Beneficial for the government as well because compliance is increasing. Overall
it is a win-win for all the stakeholders, whether it is manufacturers, government
or the consumers.
Eventually, GST will pan out to be a very good thing for manufacturers as well.
Plan to retain margins in most of our business categories.
3. JUST DIAL: Should be able to sustain at current margin levels;
Abhishek Bansal, CFO
This particular quarter saw a healthy EBITDA growth. Had about 80 percent
year-on-year (Y-o-Y) EBITDA growth.
Have been able to curtail employee costs, and optimise other expenses.
Company should able to sustain blended adjusted EBITDA margins going
forward even at current revenue growth levels.
Revenue growth was highest in last 4-5 quarters.
Going ahead campaigns should also grow thus aiding revenues.
24 January 2018
29

4. V-GUARD: LOOKING TO POST GROWTH OF 15% IN FY18 &
FY19; Mithun Chittilappilly, MD
Launched a new range of water heaters this season, so compared to last year
Q3, the advertisement spends were high.
Last year due to demonetization, had cut advertisement spend in Q3. However,
this year have increased advertisement spend and it's higher by Rs 5 crore, so
that is one of the reasons for the reduction in EBIT margins in durables.
Inverter business has also grown by 35 percent and on track to give a number
close to that.
Continuing journey with a growth of about 15 percent, so feel that in next few
years also company will have 15 percent growth.
5. NIIT LTD: Overall biz visibility at $199 million; signed LOI with
4 new customers; Sapnesh Lalla, CEO
All the business segments performed well. Even skills business for whom Q3 is
seasonally a weak quarter performed well by staying flat instead of reporting a
degrowth. So, overall Q3 was a healthy quarter in spite of seasonably it being a
weak quarter.
Monetization of stake in NIIT Tech up to the board to decide.
Acquisition of Eagle Productivity Solutions, USA is a great opportunity for the
company and help them strengthen their ability to rollout enterprise
applications across pharma and life sciences customers.
Corporate Learning Solutions renewed one of their largest customer Shell for
additional five years. The company also signed letter of intent (LOI) with four
new customers and expect some to result into contracts shortly.
Therefore, the overall visibility grew to USD 199 million.
24 January 2018
30

From the think tank
1. Fiscal consolidation is likely to continue
The financial year (FY) 2019 Union budget, to be announced on 1 February, is
going to be critical for various reasons. It will be the last full-year budget of the
current government before general election, expected to be held in May 2019,
and there are high expectations, therefore, of what the budget can or should
deliver. This budget will also help determine the Reserve Bank of India’s (RBI’s)
future course of monetary policy action, in our view, and in that regard will be
watched closely. Last but not least, this will be the first full-year budget after the
implementation of the goods and services tax (GST) in July 2017, and hence it will
be interesting to note the estimates pertaining to indirect taxes. We expect the
government to target FY19 fiscal deficit at 3% of gross domestic product (GDP).
This will help achieve a primary account surplus in FY19 (we estimate 0.2% of
GDP), from a likely deficit of 0.1-0.2% of GDP in FY18.
2. How to make businesses GST-compliant? make GST business-
compliant
The goods and services tax (GST) is a fundamental revolution in the way we
think about indirect taxes. It has created a single market, helping move goods
seamlessly across states. The GST system has enrolled close to 10 million
businesses onto a single national technology backbone, the GSTN (GST
Network), and already collected over Rs3 lakh crore in taxes in less than six
months. GST was welcomed because it aimed to create an incentive for
compliance, rather than punish non-compliance. The basic driver of GST is the
input tax credit (ITC). The tax paid by your suppliers should be subtracted from
the tax you pay to the government. ITC is not a small deal. Without ITC, the tax
you have paid becomes a cost. This tax can often be higher than the profit
margin of the business. The market encourages suppliers who are GST-
compliant. In fact, the threat of not being able to claim ITC is what drives
compliance for most businesses, as it can have a major impact on cash flow and
profits.
3. Global Bengal is still a distant dream
While it isn’t certain how many of the Rs2.19 trillion promised to the state of West
Bengal by various heavyweight investors at the recent Bengal Global Business
Summit (BGBS) will finally materialize, the surge of confidence it has generated is a
small reminder of its halcyon days. It is also a pointer to what is possible with some
well-meaning administration shorn of the kind of ideological extremism that
brought the state to its knees. Of course, skeptics doubt whether tycoons such as
Mukesh Ambani and Lakshmi Mittal will actually bring in their promised
investments. Of late, West Bengal’s expectations have been somewhat in excess of
its achievements. But it wasn’t always so. West Bengal, with Calcutta at the
centre, was a major commercial and industrial hub till 1960-61, when it ranked
second after the state of Bombay in terms of per-capita income in the country.
Home to companies such as Guest Keen Williams, Indian Iron and Steel Co.,
Andrew Yule, Bird and Co., Braithwaite & Co, Jessop & Co, Burn and Co., its share in
all-India stock of capital in the Census of Manufacturing Industries (CMI) sector was
24.6% in 1950.
24 January 2018
31

4. Pivoting to Enhance India’s Services Exports
India’s exceptional performance in exporting information technology (IT) services
has been instrumental in its integration with the global economy. However, this
growth story has been under threat in the wake of anti-globalization and
protectionist measures in major destination markets. So far, India’s focus in trade
negotiations has been mainly on temporary movement of professionals (mode 4)
and outsourcing using telecommunication services (mode 1). Mode 4 is always
attached with some political sensitivity due to perceived fear of job losses in the
destination country. Though such fears are mostly misplaced, countries put
significant restrictions on mode 4 and many countries, including the US, UK and
Australia, have increased such restrictions in recent times. With growing
protectionism and political sensitivity, our efforts at accessing traditional markets
through mode 4 have come up against a lot of resistance.
International
5. Oil’s uncertain comeback
As global economic growth picks up practically everywhere, oil producers are
becoming increasingly hopeful that the recent impressive price recovery will
continue. But, if those hopes are to be fulfilled, not only will producers have to
control what they can (by maintaining production discipline); what lies beyond
their control (output from shale and the value of the dollar) will also have to
work in their favor. Just over three years ago, oil (WTI) was trading above $100
per barrel. But, by early 2016, prices had plummeted to around $30 per barrel,
owing to a combination of sluggish demand, alternative supply (particularly
shale oil and gas from the United States), and a new OPEC production paradigm
under which the cartel, led by Saudi Arabia, withdrew from acting as a “swing
producer.” In the wake of the resulting collapse of export receipts and budget
revenues, OPEC adopted a new approach, based on a modernized production
agreement with two key features: greater flexibility for countries facing
especially complex internal conditions (such as Libya) and the inclusion of non-
OPEC producers, particularly Russia.
24 January 2018
32

Click excel icon
for detailed
valuation guide
CMP
(INR)
821
124
3294
746
19794
1856
27113
1271
809
223
3623
769
240
9397
385
418
707
Valuation snapshot
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
Aggregate
Banks - Private
AU Small Finance
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
Aggregate
Banks - PSU
BOB
BOI
Canara
Indian Bk
PNB
SBI
Union Bk
Aggregate
NBFCs
Aditya Birla Cap
Bajaj Fin.
Capital First
Cholaman.Inv.&F
n
Dewan Hsg.
GRUH Fin.
HDFC
HDFC Stand. Life
Indiabulls Hsg
Reco
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Sell
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Neutral
TP % Upside
EPS (INR)
EPS Gr. YoY (%)
P/E (x)
P/B (x)
ROE (%)
(INR) Downside FY18E FY19E FY20E FY18E FY19E FY18E FY19E FY18E FY19E FY18E FY19E
984
153
4023
859
20025
2221
34678
1554
688
265
3922
858
297
11026
458
593
756
20
23
22
15
1
20
28
22
-15
19
8
12
24
17
19
42
7
28.7
4.7
149.7
19.4
454.9
82.5
823.8
27.6
35.8
7.8
181.3
37.6
9.0
286.5
10.0
32.8
14.2
34.2
6.2
179.6
26.3
604.8
116.9
1,071.3
38.5
45.9
9.8
193.9
44.3
12.0
380.0
14.4
60.7
25.6
41.1
2.6
7.7
2.3
208.4
6.1
34.4
48.1
730.1
-3.9
140.6 -11.6
1,343.8 33.6
51.8
17.5
57.6
79.5
11.6
-4.3
214.2
7.2
48.8
37.5
14.9
94.3
482.9 15.2
18.3
30.0
66.3
65.5
34.4
21.0
26.2
21.7
44.6
10.9
9.9
8.2
100.9
21.8
3.9
101.4
17.2
54.2
30.2
4.9
30.8
-41.8
-4.4
5.3
-65.7
13.3
18.0
-11.1
0.4
27.0
LP
22.0
35.0
-22.6
24.8
17.4
199.6
Loss
51.0
17.6
69.4
3,751.8
128.4
323.3
NA
42.8
33.1
28.5
25.5
21.1
40.4
5.4
22.0
18.9
33.9
20.0
35.9
33.0
41.7
30.1
39.6
28.0
25.8
6.9
17.6
33.0
32.6
43.9
85.2
80.4
42.3
42.4
111.4
22.2
231.4
19.1
20.3
25.2
7.0
29.2
59.1
26.9
40.8
97.1
31.2
33.8
26.2
LP
138.9
11.4
79.1
70.8
59.5
79.8
46.5
39.3
33.4
16.3
22.4
19.1
-9.8
13.9
27.1
28.6
26.6
22.0
38.5
43.5
22.5
32.9
46.1
22.6
28.7
20.0
20.4
26.7
32.8
38.5
12.7
49.7
24.9
65.8
42.2
25.2
88.1
18.9
29.1
26.6
19.7
28.2
9.1
32.8
33.4
16.8
19.7
28.1
9.7
NM
13.2
11.6
17.6
27.8
7.9
21.4
47.4
37.3
23.7
22.2
16.5
60.0
28.6
97.3
16.5
24.0
19.9
18.3
28.4
32.7
15.9
25.3
33.0
17.6
22.8
18.7
17.4
20.0
24.7
26.7
6.9
27.6
17.5
46.2
19.9
20.6
26.6
15.9
24.2
21.3
18.4
21.8
5.7
25.9
23.7
8.5
15.0
21.0
7.6
34.4
5.5
10.4
9.8
16.2
4.9
11.9
32.4
26.8
17.8
19.1
13.5
50.4
31.7
85.4
13.0
4.7
5.4
5.1
7.3
6.3
2.8
10.4
8.7
3.5
3.5
6.3
3.2
2.5
6.8
8.3
2.0
11.5
4.7
8.8
2.3
2.2
2.3
1.6
4.3
2.8
1.3
4.5
0.7
4.3
3.4
1.2
3.3
3.1
1.0
0.7
0.8
1.2
1.0
1.3
0.5
0.9
4.5
6.0
3.0
4.0
2.2
17.9
6.4
3.0
4.3
4.0
4.7
4.5
6.1
5.6
2.4
7.8
7.2
3.0
3.2
5.5
2.9
2.2
5.8
6.8
1.5
8.6
3.9
7.4
2.1
2.0
2.1
1.5
3.8
2.6
1.2
3.8
0.7
3.7
3.1
1.1
2.8
2.8
0.9
0.7
0.7
1.1
0.9
1.2
0.4
0.9
3.5
5.0
2.6
3.4
1.9
14.7
5.4
2.5
3.8
17.6
21.1
24.2
20.3
15.1
13.0
36.0
20.5
16.8
12.3
33.4
14.1
9.9
20.4
23.4
17.0
25.4
18.7
14.3
5.9
10.1
2.6
9.4
16.7
8.8
6.8
17.0
8.4
13.2
12.4
6.9
17.6
11.2
6.4
-0.4
5.0
10.9
5.3
5.3
5.9
4.4
12.5
20.2
13.2
19.6
13.9
32.7
19.1
21.7
27.6
18.1
25.0
26.0
23.4
18.2
16.2
35.2
23.8
18.4
13.9
31.2
14.6
11.8
23.1
28.1
24.8
35.8
22.1
17.3
11.1
10.4
8.2
9.8
16.6
10.5
6.9
19.1
12.3
14.3
13.7
12.7
19.9
13.4
9.4
1.8
11.3
11.2
9.0
8.0
9.1
7.3
12.3
20.4
15.4
19.2
15.2
32.1
18.3
21.1
31.0
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
713
619
185
153
103
1951
362
59
1723
76
1074
537
32
359
705
710
188
209
149
2350
370
65
2076
100
1220
665
38
410
-1
15
1
37
44
20
2
9
20
31
14
24
17
14
10.8
14.7
7.4
1.7
5.5
67.0
13.6
3.0
61.1
8.4
32.7
16.0
1.9
18.2
15.4
31.0
9.0
5.7
6.5
80.6
17.0
3.2
78.9
13.4
41.5
22.6
3.8
23.9
Buy
Neutral
Neutral
Buy
Buy
Buy
Neutral
173
169
375
398
186
318
145
217
175
366
438
250
415
153
25
3
-2
10
34
31
5
17.9
-1.2
28.4
34.4
10.5
11.5
18.4
22.6
4.9
67.8
38.3
18.9
19.6
29.4
29.7
10.3
99.7
42.3
24.1
34.9
45.0
Buy
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
176
1707
778
1311
614
592
1882
459
1379
231
2300
960
1500
710
500
2182
485
1550
31
35
23
14
16
-15
16
6
12
3.7
45.7
32.8
59.1
37.2
9.9
65.8
4.7
83.7
5.4
63.7
43.7
68.7
45.5
11.7
59.3
5.4
106.3
7.8
87.0
56.5
84.2
56.5
14.6
68.9
6.7
132.7
24 January 2018
33

Click excel icon
for detailed
valuation guide
CMP
(INR)
180
573
644
508
436
1301
687
2047
1469
TP % Upside
(INR) Downside
240
34
640
12
740
15
562
11
515
18
1750
35
800
16
2700
1700
32
16
EPS (INR)
EPS Gr. YoY (%)
FY19E FY20E FY18E FY19E
10.9
13.5
41.8 47.4
45.5
53.9
3.9
14.4
24.1
29.6
21.9 31.3
18.7
23.1
90.5 38.5
42.0
48.1
44.4
-1.4
66.5
88.8
66.2 26.6
41.9
50.0
23.5 16.5
173.7
127.6
37.1
44.9
35.3
-3.4
12.7
119.0
28.0
10.9
-64.9
-4.4
64.4
19.4
20.5
13.8
10.9
27.3
-1.7
15.2
13.4
15.2
25.6
31.8
15.0
48.7
13.3
-19.9
48.3
25.2
57.4
32.2
19.4
21.6
23.3
19.3
56.9
19.5
16.3
8.0
12.0
19.3
Valuation snapshot
P/E (x)
P/B (x)
FY18E FY19E FY18E FY19E
24.2 16.4
3.5
3.0
14.4 12.6
2.3
2.0
35.1 26.8
4.9
4.3
37.6 27.2
3.4
3.2
10.2 10.4
2.2
1.9
24.8 19.6
3.5
3.1
19.1 16.4
3.2
2.7
17.7
18.2
27.2
85.9
24.7
35.6
46.0
51.1
65.7
35.9
45.4
51.1
25.7
29.3
66.5
43.4
42.4
18.3
35.7
35.4
14.1
13.8
23.6
57.8
21.8
44.4
31.0
40.8
41.7
27.1
38.0
42.0
20.8
24.6
42.4
36.3
36.4
16.9
31.8
29.7
34.2
26.5
20.5
36.1
10.5
17.4
18.5
22.4
22.5
18.5
28.3
21.2
14.8
42.1
32.1
24.2
45.6
44.1
41.2
39.3
37.5
44.3
36.5
49.0
2.4
2.6
4.9
9.4
4.4
1.2
9.0
22.6
1.4
6.3
9.3
9.9
5.0
3.6
6.1
8.5
5.2
3.0
5.5
3.9
2.6
3.7
2.6
4.9
1.6
1.1
3.9
3.3
4.4
3.1
6.7
2.7
2.3
7.1
4.6
3.4
14.4
17.3
23.5
11.4
13.8
10.9
8.2
44.9
2.1
2.3
4.1
8.4
4.0
1.2
8.3
18.5
1.4
5.8
8.0
8.7
4.2
3.3
5.6
7.2
4.7
2.6
4.9
3.6
2.5
3.5
2.3
4.3
1.4
1.0
3.3
2.9
3.7
2.7
5.5
2.4
2.0
6.2
4.1
3.0
12.7
14.1
22.0
10.2
11.9
9.5
7.5
44.7
ROE (%)
FY18E FY19E
15.8 19.6
16.9 16.9
19.8 17.0
10.7 12.2
23.8 19.9
15.0 16.7
18.1 17.9
14.3
15.1
17.9
10.9
17.9
3.3
20.2
51.0
2.1
18.1
21.8
19.4
19.5
12.8
9.1
21.4
12.8
17.5
16.5
10.9
6.2
10.3
7.3
10.3
11.5
3.5
17.5
9.9
16.0
12.3
13.7
6.5
10.8
17.6
9.7
10.0
26.9
34.0
48.8
26.0
31.7
23.8
20.7
76.5
15.9
17.4
17.5
14.5
18.1
2.6
27.8
49.8
3.3
22.2
22.6
20.8
20.2
14.0
13.1
21.5
13.5
16.4
16.3
12.0
7.4
13.7
12.0
12.7
14.5
6.0
19.2
13.9
17.9
15.6
21.3
12.0
14.6
15.7
13.5
12.5
29.6
35.2
55.2
27.3
34.0
22.9
21.4
91.4
Company
Reco
L&T Fin Holdings Buy
LIC Hsg Fin
Neutral
MAS Financial
Buy
M&M Fin.
Buy
Muthoot Fin
Neutral
PNB Housing
Buy
Repco Home
Buy
Shriram
City
Buy
Union
Shriram Trans. Buy
Aggregate
Capital Goods
ABB
Sell
Bharat Elec.
Buy
BHEL
Sell
Blue Star
Neutral
CG Cons. Elec.
Buy
CG Power & Indu. Neutral
Cummins
Buy
GE T&D
Neutral
Havells
Buy
K E C Intl
Neutral
L&T
Buy
Siemens
Neutral
Solar Ind
Neutral
Thermax
Neutral
Va Tech Wab.
Buy
Voltas
Neutral
Aggregate
Cement
Ambuja Cem.
Neutral
ACC
Neutral
Birla Corp.
Buy
Dalmia Bharat
Buy
Grasim Inds.
Neutral
India Cem
Neutral
J K Cements
Buy
JK Lakshmi Ce
Buy
Ramco Cem
Buy
Orient Cem
Buy
Prism Cem
Buy
Sagar Cements Not Rated
Sanghi Inds.
Buy
Shree Cem
Buy
Ultratech
Buy
Aggregate
Consumer
Asian Paints
Neutral
Britannia
Buy
Colgate
Buy
Dabur
Buy
Emami
Buy
Godrej Cons.
Neutral
GSK Cons.
Neutral
HUL
Buy
FY18E
7.4
39.7
18.3
13.5
42.6
52.5
36.0
115.6 145.3
80.6
106.2
1635
175
104
758
265
95
909
428
583
367
1410
1314
1137
1283
629
625
1230
210
78
685
315
90
1150
440
640
350
1540
1313
1120
1150
745
580
-25
20
-25
-10
19
-5
26
3
10
-5
9
0
-2
-10
18
-7
19.0
7.1
2.9
16.5
5.2
1.4
25.3
9.4
11.4
14.3
48.1
19.8
26.2
30.3
34.5
17.5
28.3
8.0
2.3
24.4
6.5
2.3
33.5
11.2
13.9
17.6
57.4
31.0
31.3
35.2
37.2
19.6
34.1
8.6
3.5
31.0
7.8
3.0
39.6
14.0
17.2
21.7
68.2
35.3
39.3
38.4
41.9
22.4
263
1794
1160
3022
1224
184
1146
428
790
167
141
1071
132
18368
4368
275
1795
1435
3568
1286
188
1324
512
913
205
130
-
157
22424
5131
5
0
24
18
5
2
16
20
16
23
-8
19
22
17
6.1
7.7
48.6 67.8
32.2 56.7
60.8 83.7
81.9 116.8
5.8
10.5
47.8 61.8
12.1 19.1
27.1 35.1
6.3
9.1
2.7
5.0
25.2 50.6
5.8
8.9
423.0 435.8
89.0 136.2
9.8
80.4
61.6
111.7
133.5
12.1
79.1
25.2
44.7
15.2
6.6
70.6
12.0
724.2
178.4
25.5 25.3 42.9
34.5 39.5 36.9
12.8 76.1 36.0
56.8 37.6 49.7
20.8 42.5 14.9
3.9
80.4 31.5
41.7 29.5 24.0
74.3 57.2 35.3
-0.5
29.3 29.1
LP
44.0 26.6
905.1 81.3 51.3
LP
101.0 42.6
102.0 53.5 22.7
10.0
3.0
43.4
-7.4
53.0 49.1
17.7 38.9 33.6
2.7
14.7
10.3
6.8
0.2
11.9
3.0
17.6
18.8
26.4
19.8
20.0
25.0
15.8
13.4
20.7
54.1
55.7
49.3
47.2
46.9
51.3
41.4
59.2
1168
4712
1155
365
1247
1085
6651
1367
1270
6098
1357
410
1655
1042
5785
1585
9
29
18
12
33
-4
-13
16
21.6 25.6
84.5 106.9
23.4 28.1
7.7
9.3
26.6 33.2
21.2 24.5
160.8 182.3
23.1 27.9
30.8
133.8
33.7
10.9
38.6
27.4
206.5
32.9
24 January 2018
34

Click excel icon
for detailed
valuation guide
CMP
(INR)
276
371
313
7592
22010
293
886
9284
220
1157
3751
TP % Upside
(INR) Downside
278
1
380
2
355
13
8173
8
28650
30
314
7
1044
18
9461
2
-
1320
14
3449
-8
EPS (INR)
EPS Gr. YoY (%)
FY19E FY20E FY18E FY19E
10.2
11.4
6.6
13.7
10.7
13.3
-27.7 32.0
7.7
9.3
-1.2
24.3
146.9 177.7
4.0
14.2
413.1 544.5 24.3 39.3
12.4
16.8 147.7 38.7
20.8
24.0
2.9
20.7
176.7 209.4 14.0 16.6
6.4
9.7
-2.0
83.8
18.0
22.3
68.9 22.4
56.0
76.9
36.5 53.5
9.2
18.5
29.7
109.1
79.2
55.3
18.3
26.4
33.3
52.4
144.6
8.4
50.5
13.0
60.6
35.2
72.5
37.8
57.1
180.5
37.8
77.9
27.5
78.5
0.3
-8.9
-8.1
13.5
-36.7
23.0
42.3
-18.9
-16.2
-81.8
-3.4
-5.4
28.6
10.9
29.5
17.8
-33.6
8.5
29.3
12.6
-44.5
-9.9
-14.2
LP
12.5
11.5
29.3
15.1
31.7
21.7
12.8
53.0
35.8
19.5
35.0
90.1
160.8
12.9
31.1
24.3
47.0
30.9
49.4
13.7
12.4
65.1
71.9
52.0
23.6
33.6
Valuation snapshot
P/E (x)
P/B (x)
FY18E FY19E FY18E FY19E
30.9 27.2
6.7
6.2
45.7 34.6
6.4
6.3
50.4 40.6 15.3 14.5
59.0 51.7 22.0 19.9
74.2 53.3 29.5 23.6
32.8 23.6
3.4
2.9
51.5 42.6 11.3
9.3
61.3 52.5 36.3 30.3
63.3 34.5
3.0
2.8
78.9 64.5 11.5
9.9
102.8 67.0 19.4 14.4
46.6 39.3 12.5 11.3
25.3
32.7
29.7
14.7
99.4
24.6
27.5
34.0
41.5
79.9
16.7
20.3
55.7
32.7
18.6
26.5
24.9
33.7
32.7
21.9
39.8
28.9
29.6
22.0
24.8
24.4
13.0
65.0
18.1
23.0
25.2
21.8
30.6
14.8
15.5
44.8
22.2
14.2
17.8
21.9
29.9
19.8
12.8
26.2
23.4
22.1
32.8
10.4
21.8
27.6
17.1
15.2
26.6
12.9
23.4
4.7
5.2
7.1
3.2
7.5
5.3
3.5
5.7
3.3
1.2
3.3
2.5
12.3
2.8
3.4
3.8
2.9
5.8
4.5
2.4
3.6
5.0
3.8
2.4
1.4
4.2
3.7
2.2
2.5
3.9
2.4
3.6
4.0
4.5
5.7
2.6
7.0
4.3
3.1
5.0
2.9
1.2
2.7
2.3
14.1
2.5
2.8
3.1
2.6
5.3
3.7
2.0
3.3
4.4
3.4
2.2
1.3
3.5
3.3
2.0
2.2
3.6
2.3
3.3
9.9
2.9
2.9
3.8
ROE (%)
FY18E FY19E
22.8 23.8
13.8 18.3
32.3 36.8
39.1 40.4
39.8 44.4
10.8 13.3
24.1 23.9
64.8 62.9
4.9
8.5
15.5 16.5
18.9 21.5
26.9 28.7
19.9
17.0
26.4
24.6
7.6
23.4
12.8
16.3
8.2
1.6
19.6
14.2
22.0
8.8
19.7
15.4
12.0
17.2
14.7
11.4
9.3
18.2
13.0
1.9
14.1
19.1
13.7
11.8
14.1
11.5
9.2
11.4
13.3
20.1
-6.3
4.9
19.8
19.4
25.7
22.3
10.7
26.1
13.5
21.2
14.1
3.9
18.4
15.4
31.4
11.9
21.4
19.4
12.5
17.7
20.5
17.0
13.2
19.9
15.3
7.0
12.9
17.5
12.6
11.7
15.4
14.1
18.2
14.2
34.9
20.9
0.2
10.1
Company
ITC
Jyothy Lab
Marico
Nestle
Page Inds
Parag Milk
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
Reco
Neutral
Neutral
Neutral
Neutral
Buy
Neutral
Buy
Neutral
Not Rated
Buy
Neutral
FY18E
9.0
8.1
6.2
128.6
296.6
8.9
17.2
151.5
3.5
14.7
36.5
Neutral
Buy
Buy
Buy
Neutral
Buy
Neutral
Neutral
Neutral
Buy
Neutral
Buy
Neutral
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Neutral
548
2221
1565
655
642
430
623
1102
2522
150
632
139
2459
582
891
556
936
4713
592
797
578
1438
540
2500
1791
900
485
555
600
1100
2575
185
650
200
2500
550
1110
651
1000
5000
797
1074
610
1400
-1
13
14
37
-24
29
-4
0
2
23
3
44
2
-6
25
17
7
6
35
35
6
-3
21.6 24.9
68.0 89.5
52.7 64.1
44.6 50.3
6.5
9.9
17.5 23.7
22.6 27.0
32.4 43.7
60.8 115.7
1.9
4.9
37.9 42.8
6.8
9.0
44.2 54.9
17.8 26.2
47.8 62.6
21.0 31.3
37.6 42.7
140.1 157.4
18.1 29.9
36.3 62.5
14.5 22.1
49.7 61.4
Buy
Neutral
Buy
Buy
232
242
317
405
275
240
325
445
19
-1
3
10
1.8
22.9
13.3
14.2
7.1
23.2
14.5
14.6
16.0
19.7
16.0
17.0
290.2 128.1
1.4
10.6
9.0
3.5
23.8
28.6
18.9
Buy
Neutral
Buy
202
1467
237
242
1496
282
20
2
19
10.9
42.7
8.8
13.3
55.2
18.4
15.3
68.1
21.3
10.7
12.4
29.6
13.1
22.0
29.3
18.5
34.4
109.2 26.9
33.4
31.2
Buy
Buy
Neutral
Buy
73
342
129
784
106
420
90
910
45
23
-30
16
0.7
18.8
-2.9
9.0
2.2
23.0
0.1
20.0
3.8
27.6
4.0
31.7
-36.4
-7.6
Loss
-21.5
237.6 112.3 33.3 14.0
22.0 18.2 14.9
3.4
LP
NM 1,818.8 2.9
122.7 87.4 39.2
4.2
24 January 2018
35

Click excel icon
for detailed
valuation guide
CMP
(INR)
45
261
107
179
393
1531
110
25
1040
594
TP % Upside
(INR) Downside
47
4
305
17
117
9
225
25
469
19
1638
7
148
34
27
9
1155
11
705
19
EPS (INR)
EPS Gr. YoY (%)
FY19E FY20E FY18E FY19E
0.8
2.0
Loss
LP
28.8
32.4
0.2
11.3
12.1
12.7
59.3
2.6
13.4
16.1
2.5
22.2
14.1
17.8
26.0 74.5
43.0
57.3
23.7 69.1
6.1
9.2
164.0 90.5
0.1
0.6
Loss
LP
35.7
41.8
13.0 27.0
17.6
21.0
2.1
28.7
19.0 39.2
25.9
33.3
7.7
24.9
5.3
14.0
4.5
38.9
43.7
85.3
26.3
32.1
12.3
23.8
5.4
14.7
6.5
43.0
45.5
67.2
117.2
9.6
Loss
33.3
24.8
43.7
Loss
165.2
63.7
65.0
65.5
-15.3
15.8
27.2
41.4
-12.8
-7.4
14.4
23.6
-29.6
-11.7
16.7
32.3
19.6
6.2
186.2
44.4
37.7
47.9
18.1
3.1
20.1
2.6
-1.8
18.2
31.5
7.6
17.4
14.4
30.8
39.1
54.6
LP
26.2
13.1
-2.0
LP
52.3
76.2
36.0
58.4
25.0
19.3
58.5
4.2
20.2
5.8
15.2
-1.1
25.0
37.7
21.8
11.3
11.8
15.7
29.6
26.6
27.7
27.6
12.1
3.8
-1.1
9.7
13.8
7.3
24.6
4.9
16.9
17.5
18.4
Valuation snapshot
P/E (x)
P/B (x)
FY18E FY19E FY18E FY19E
NM
59.4
3.2
3.0
10.1
9.1
1.4
1.2
9.1
8.9
1.0
0.9
16.4 13.4
2.8
2.4
48.5 27.8
3.8
3.3
60.3 35.7
6.7
5.7
34.1 17.9
5.0
3.9
NM 195.9 4.7
4.6
37.0 29.2
9.4
8.5
43.4 33.8
7.3
6.3
38.6 27.7
5.7
5.0
14.2
13.8
NM
14.9
16.9
10.4
NM
16.6
13.8
12.4
15.4
11.8
18.1
43.5
16.8
11.2
10.0
31.1
19.4
12.6
12.6
10.8
16.3
16.2
13.2
75.2
37.4
72.7
62.0
18.3
16.1
22.1
18.2
17.4
17.7
23.2
19.0
17.6
18.4
29.3
10.2
8.9
37.6
11.8
14.9
10.7
21.4
10.9
7.9
9.1
9.7
9.4
15.1
27.4
16.1
9.3
9.5
26.9
19.6
10.1
9.1
8.9
14.7
14.5
11.4
58.0
29.5
56.9
48.6
16.4
15.5
22.3
16.6
15.3
16.5
18.6
18.1
15.0
15.6
24.7
1.8
4.4
0.9
2.7
1.4
1.9
1.1
3.8
2.0
2.1
1.9
2.6
2.0
6.5
2.3
2.5
1.6
6.3
5.0
2.0
1.0
1.2
3.8
2.0
1.7
16.9
5.9
15.3
11.9
3.2
3.9
5.5
4.2
2.3
5.1
4.8
3.1
2.8
3.1
9.4
1.5
3.4
0.9
2.2
1.3
1.8
1.1
2.8
1.7
1.8
1.6
2.2
1.8
5.5
2.1
2.1
1.4
5.3
4.6
1.7
0.9
1.1
3.2
1.8
1.6
17.3
5.1
13.9
10.6
2.9
3.6
4.6
3.6
2.0
4.1
4.2
2.9
2.5
3.0
7.5
ROE (%)
FY18E FY19E
-1.2
5.2
15.1 14.6
11.5 10.6
16.8 19.4
8.1
12.7
11.6 17.2
15.9 24.7
-14.2 2.4
26.4 30.7
18.2 20.0
14.7 17.9
13.4
30.8
-4.6
19.3
8.6
19.1
-1.5
25.2
14.7
18.0
12.0
24.0
11.2
16.0
14.7
24.5
16.9
22.0
27.3
16.9
8.0
10.9
25.3
12.9
13.1
22.5
16.9
23.2
19.1
17.4
25.1
26.6
24.3
13.9
32.1
19.9
14.6
16.1
17.8
36.0
16.2
42.7
2.5
20.3
9.2
17.2
5.0
29.7
23.5
21.0
16.8
25.4
12.4
21.7
13.7
25.1
16.0
21.4
24.4
18.5
10.5
12.8
23.6
13.1
13.9
29.8
18.4
25.6
21.9
17.8
23.9
22.4
23.1
13.8
27.5
24.0
16.6
17.6
20.1
33.8
Company
Hathway Cable
Hind. Media
HT Media
Jagran Prak.
Music Broadcast
PVR
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
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
Reco
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
FY18E
-0.2
25.9
11.8
11.0
8.1
25.4
3.2
-0.8
28.1
13.7
Buy
Neutral
Buy
Buy
Neutral
Buy
Sell
Buy
Buy
Neutral
265
297
291
294
78
149
97
425
343
780
321
354
363
337
81
215
75
492
386
858
21
19
25
15
3
44
-22
16
13
10
18.6
21.6
-14.8
19.7
4.6
14.3
-1.4
25.5
24.8
62.7
Buy
Sell
Buy
Neutral
Buy
Buy
Buy
Neutral
Sell
Buy
Buy
Buy
Buy
481
472
888
209
396
389
312
1054
131
375
207
246
982
632
371
1000
183
576
545
416
1219
113
420
234
312
1069
31
-21
13
-12
46
40
33
16
-14
12
13
27
9
40.9
26.1
20.4
12.5
35.5
38.8
10.1
54.4
10.4
29.8
19.2
15.0
60.4
51.2
31.2
32.4
13.0
42.7
41.0
11.6
53.8
13.0
41.0
23.4
16.7
67.5
54.1
32.7
41.7
14.0
45.3
43.6
13.5
54.5
13.7
42.3
22.6
20.3
76.8
Neutral
Buy
Buy
2283
577
904
2185
685
973
-4
19
8
30.3
15.4
12.4
39.3
19.5
15.9
51.6
24.9
19.8
Buy
Neutral
Neutral
Buy
Neutral
Buy
Buy
Neutral
Neutral
Buy
Buy
664
994
363
1175
203
1162
760
795
784
793
1077
675
950
270
1250
160
1200
725
670
800
780
1236
2
-4
-26
6
-21
3
-5
-16
2
-2
15
36.2
61.7
16.4
64.4
11.7
65.6
32.7
41.9
44.6
43.1
36.8
40.6
64.1
16.3
70.7
13.3
70.4
40.8
43.9
52.2
50.7
43.6
45.9
68.9
18.5
78.6
17.2
82.3
47.8
49.5
60.6
60.2
51.5
24 January 2018
36

Click excel icon
for detailed
valuation guide
CMP
(INR)
3103
588
315
931
TP % Upside
(INR) Downside
2700
-13
560
-5
300
-5
1100
18
EPS (INR)
EPS Gr. YoY (%)
FY19E FY20E FY18E FY19E
147.3 161.0
-2.1
12.8
39.2
45.1
17.2
8.4
18.5
21.2
6.0
3.2
64.1
85.2
4.0
18.3
3.7
5.0
3.9
16.2
-11.8
16.0
7.2
17.8
-10.8
30.1
-68.7
-6.1
Loss
-56.4
PL
23.7
71.7
4.8
-19.3
12.4
24.8
-0.5
16.8
-15.0
56.2
17.8
17.2
-3.5
45.1
93.7
11.2
45.7
-38.2
50.9
78.9
47.0
-16.0
21.9
3.6
122.1
153.2
-10.4
17.7
-10.7
9.1
11.4
8.4
4.4
25.3
12.2
16.5
Loss
267.3
LP
45.0
14.7
-18.2
30.3
16.6
17.0
12.2
26.0
56.5
45.6
21.0
15.3
0.3
20.4
40.7
21.6
20.5
32.9
10.9
20.2
63.1
41.1
20.6
28.4
46.3
17.7
19.0
34.1
36.7
31.6
48.4
28.1
27.8
32.9
Valuation snapshot
P/E (x)
P/B (x)
FY18E FY19E FY18E FY19E
23.8 21.1
7.4
6.5
16.2 15.0
3.0
2.6
17.6 17.0
3.1
2.6
17.2 14.5
2.6
2.2
19.8 18.8
4.9
4.3
141.0 125.7
24.3 20.9
NM
NM
146.8 40.0
-472.1 850.8
15.9
12.4
22.5
12.8
12.8
11.2
12.5
13.4
43.2
97.4
46.1
19.1
28.9
23.7
65.7
30.7
19.0
14.4
59.1
15.2
44.4
40.4
24.4
20.0
20.6
46.1
32.2
33.2
25.5
38.4
51.8
12.2
62.4
53.2
10.9
10.8
27.6
9.8
11.0
9.6
11.2
10.6
27.6
66.8
38.1
16.5
28.8
19.7
46.7
25.3
15.7
10.9
53.3
12.7
27.2
28.6
20.2
15.5
14.1
39.2
27.0
24.8
18.6
29.2
34.9
9.5
48.8
40.0
2.9
4.2
1.7
12.7
2.9
7.1
1.3
1.4
1.1
1.4
1.8
1.9
2.0
3.1
16.7
6.4
1.9
28.5
5.0
6.5
8.9
7.0
2.2
7.7
3.7
3.8
3.2
7.5
4.5
2.7
5.9
6.8
2.6
3.2
4.9
8.4
1.5
10.7
13.0
2.8
4.3
2.1
9.6
3.0
6.7
1.1
1.4
1.0
1.3
1.6
1.6
1.9
2.9
14.2
ROE (%)
FY18E FY19E
30.4 32.9
19.1 18.8
17.2 16.7
15.7 16.4
24.9 22.9
2.1
2.3
17.0 20.4
-19.9 -22.3
8.2
27.4
-0.6
0.4
44.6
10.7
6.3
8.4
11.0
17.0
16.2
15.1
7.4
18.2
60.8
11.1
5.0
10.8
11.9
17.4
15.9
17.5
10.9
22.9
Company
TCS
Tech Mah
Wipro
Zensar Tech
Aggregate
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
Bata India
BSE
Castrol India
Coromandel Intl
Delta Corp
Eveready Inds.
Interglobe
Indo Count
Info Edge
Kaveri Seed
Manpasand
MCX
Monsanto
Navneet
Education
Oberoi Realty
Quess Corp
Reco
Neutral
Buy
Neutral
Buy
FY18E
130.6
36.2
17.9
54.2
Buy
Neutral
Buy
Buy
491
339
99
639
680
380
120
780
39
12
21
22
3.5
14.0
-12.1
4.4
Buy
Buy
Sell
Buy
Buy
Buy
Sell
293
1103
91
30
173
196
93
356
1360
51
37
211
261
73
22
23
-44
22
22
33
-21
18.5
89.1
4.0
2.4
13.4
17.4
7.4
26.8
102.1
3.3
3.1
15.7
20.4
8.3
31.1
110.7
3.6
3.7
17.8
21.3
8.5
Neutral
Sell
Sell
Neutral
Buy
Buy
Buy
Buy
Neutral
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
455
1167
734
915
189
573
389
440
1194
116
1397
519
415
842
2558
151
510
1062
962
2837
1953
303
2239
88
8596
238
431
873
578
1100
235
523
382
400
1306
128
1300
738
533
1100
3293
194
580
1170
-
3500
2202
343
2500
114
5281
167
-5
-25
-21
20
24
-9
-2
-9
9
10
-7
42
29
31
29
28
14
10
10.5
12.0
16.5
17.5
23.2
24.1
22.4
65.4
6.7
30.3
11.2
22.1
109.8
12.4
30.5
48.1
20.2
34.9
149.9
11.4
42.3
34.3
40.3
146.7
132.7
12.2
86.3
11.6
203.2
6.7
15.9 19.3
48.0 55.4
6.6
6.6
24.1 29.0
5.9
8.3
14.3 17.4
63.0 75.9
8.0
10.7
23.6 26.2
34.1 41.0
9.3
15.2
20.8 29.4
105.0 126.6
7.6
24.8
23.0
29.9
9.7
36.2
27.1
35.6
5.6
14.6 15.7
1.6
9.8
9.6
26.0 103.8 94.6
4.3
22.5 23.4
5.9
12.6 13.2
7.2
32.1 31.5
6.6
46.7 43.3
1.8
17.0 18.5
6.9
13.7 13.7
3.2
23.3 27.4
3.5
7.7
13.4
3.1
7.9
11.0
6.5
32.5 34.5
3.9
2.3
5.0
5.7
2.3
2.9
4.4
6.8
1.3
9.5
10.4
23.9
13.9
21.8
23.0
9.1
13.2
13.4
17.7
12.6
18.0
26.9
26.9
17.8
16.6
22.9
10.1
16.3
16.0
21.5
14.5
20.7
28.8
Buy
Buy
Under
PI Inds.
Review
Piramal Enterp. Buy
SRF
Buy
S H Kelkar
Buy
Team Lease Serv. Buy
Trident
Buy
TTK Prestige
Neutral
V-Guard
Neutral
23
13
13
12
30
-39
-30
85.4 114.5
76.7 104.9
7.9
10.4
43.2 64.2
7.2
9.2
137.8 176.1
4.5
6.0
24 January 2018
37

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
AU Small Fin. Bank
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 (%)
-0.5
2.5
0.7
1.0
-0.8
1.0
-1.9
-0.4
3.2
-0.2
0.6
1.1
0.5
1.0
0.3
-0.8
-1.0
-0.2
1.3
-0.9
-0.5
1.6
-0.6
3.1
0.1
2.4
-0.7
0.3
1.4
0.5
1.0
4.9
3.1
3.2
4.2
5.7
3.8
3.2
-1.3
0.1
0.1
0.1
-2.5
-0.1
0.4
-2.6
1.9
0.8
-0.1
4.0
0.9
1M (%)
-1.5
5.6
-1.0
2.3
-0.6
-4.8
-10.4
-5.7
8.5
1.2
-4.3
3.0
-4.2
-3.1
2.4
-0.9
-8.8
5.2
11.8
-4.7
6.1
-4.1
3.9
14.4
8.1
4.5
-2.4
6.5
4.2
2.4
15.7
3.1
-1.0
1.2
1.6
5.7
-0.6
-2.2
-5.9
-4.2
10.9
1.4
3.5
18.5
10.2
22.7
15.5
0.5
0.9
7.0
-5.9
12M (%)
-5.9
43.8
21.7
59.7
-6.8
57.4
19.3
117.3
124.9
14.9
16.9
29.4
23.3
64.7
78.5
-21.4
85.9
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
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
J K Cements
JK Lakshmi Ce
Ramco Cem
Orient Cem
Prism Cem
Sagar Cements
Sanghi Inds.
Shree Cem
Ultratech
Consumer
Asian Paints
Britannia
Colgate
Dabur
Emami
Godrej Cons.
GSK Cons.
HUL
ITC
Jyothy Lab
Marico
Nestle
Page Inds
Parag Milk
Pidilite Ind.
P&G Hygiene
1 Day (%)
1.1
0.7
-1.1
-0.5
-0.3
2.3
-0.1
0.0
-2.5
1.5
-0.3
-0.5
2.1
5.6
2.6
0.8
-0.2
0.7
-0.7
-1.0
0.0
-2.2
-1.9
-0.1
1.2
-1.1
-0.4
-2.1
-0.6
1.1
-1.6
-1.7
2.3
-1.6
-0.2
0.9
-0.8
0.2
-1.4
0.5
0.1
-0.4
0.1
0.7
1.1
-0.1
-1.0
-0.9
0.1
0.4
-1.1
0.5
1M (%)
2.5
-3.5
0.5
-1.3
0.4
18.6
-7.2
13.2
-4.8
-0.7
4.5
3.6
0.4
6.2
-3.0
11.3
6.8
-3.4
5.4
2.0
-4.8
-1.7
4.2
1.9
-7.8
8.0
0.4
5.6
-4.0
1.6
0.2
20.8
28.3
2.4
3.2
1.9
2.7
-0.7
5.8
3.2
-5.1
9.9
2.6
1.1
4.9
-3.6
-1.3
-3.5
-10.6
-0.4
-6.2
-1.2
12M (%)
56.9
8.6
3.3
59.6
46.3
27.0
21.9
48.1
59.5
48.2
8.7
35.2
42.7
152.0
51.7
13.4
61.7
57.9
28.2
84.7
19.5
34.3
64.7
68.5
66.1
32.3
59.0
21.7
26.4
30.5
56.4
53.8
112.6
21.5
24.2
21.1
52.8
28.1
32.0
25.1
41.0
32.9
58.3
6.5
5.8
22.7
28.6
56.5
12.5
41.1
36.5
39.0
56.4
-3.7
32.3
56.8
54.7
-6.5
39.9
21.4
47.0
37.9
68.6
29.9
12.3
48.1
40.1
60.0
43.4
25.1
5.0
83.7
32.9
32.9
124.1
78.8
49.5
82.7
90.4
9.1
84.9
47.2
24 January 2018
38

MOSL Universe stock performance
Company
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
JSW Steel
1 Day (%)
-0.2
0.2
-0.8
0.0
-0.9
-1.3
2.1
6.4
-2.1
3.6
2.2
1.2
2.2
1.7
0.1
0.1
-1.1
0.5
0.7
1.2
0.0
-1.1
-0.2
0.3
-0.9
-0.2
1.1
2.4
0.5
-0.1
-1.4
-0.3
3.0
-1.6
7.0
2.2
7.5
-0.8
-1.3
0.4
-3.0
3.8
1.5
0.4
0.6
-2.5
3.8
1.6
10.3
5.3
1M (%)
-3.4
9.1
5.6
3.6
3.6
5.9
-4.0
18.9
1.5
3.9
1.2
8.1
5.5
11.1
5.2
0.9
-2.9
15.2
7.5
0.7
-0.1
-1.9
-4.7
9.0
5.4
-8.9
2.6
2.9
-2.3
2.6
7.8
-0.8
-9.1
0.5
17.2
3.8
9.5
5.7
10.0
5.1
3.6
6.3
-4.4
-3.3
4.5
3.4
-1.1
-3.2
57.7
11.1
12M (%)
106.2
43.3
70.2
-6.8
35.0
-12.2
-5.5
92.7
20.5
7.9
60.4
-13.8
-17.4
-27.9
24.3
-9.7
5.5
31.9
-36.9
16.5
11.7
-17.5
-27.9
-8.9
11.8
39.1
13.7
73.2
50.1
18.9
56.7
0.9
-13.9
-5.1
40.2
2.2
19.1
-3.1
35.1
0.2
20.5
32.8
-35.4
100.3
22.9
46.1
0.6
268.3
51.2
Company
Nalco
NMDC
Rain Industries
SAIL
Vedanta
Tata Steel
Oil & Gas
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 (%)
1.9
3.7
-1.4
4.6
5.0
3.7
2.7
3.3
1.3
-0.5
-1.5
1.8
0.9
0.6
1.3
0.9
3.6
3.6
1.1
0.6
-0.9
-0.6
5.2
2.7
2.9
2.2
2.0
3.3
0.6
0.2
2.5
0.4
-0.1
-0.3
3.2
-1.8
-0.7
0.2
-1.2
-0.2
-0.8
3.0
-0.7
2.2
1.3
0.1
0.5
0.7
1M (%)
-4.4
10.7
17.7
13.0
8.4
9.8
-9.9
-6.1
8.0
-5.6
-7.8
-5.1
-5.1
-5.8
2.5
4.5
7.1
-2.5
6.9
29.1
30.4
5.6
16.4
12.1
7.7
13.2
17.9
8.4
26.9
8.1
21.9
22.1
12.4
17.6
19.3
4.6
6.3
-7.2
-6.7
-1.2
-6.0
10.2
5.1
1.6
0.2
-4.0
-3.5
-0.6
12M (%)
5.7
2.8
545.2
57.7
39.8
69.0
6.7
33.7
64.5
32.9
16.3
8.8
69.2
22.2
29.1
11.5
3.7
35.0
93.3
170.1
198.6
148.3
42.4
15.9
84.3
23.5
49.2
75.0
60.9
51.4
77.4
29.4
44.7
34.6
25.3
31.5
1.3
53.7
-2.4
35.7
-5.0
-3.5
58.3
52.3
9.9
1.5
-2.0
19.5
24 January 2018
39

MOSL Universe stock performance
Company
Others
Arvind
Avenue Super.
Bata India
BSE
Castrol India
Coromandel Intl
Delta Corp
Eveready Inds.
Interglobe
Indo Count
Info Edge
Kaveri Seed
Manpasand
MCX
Monsanto
Navneet Educat.
Oberoi Realty
PI Inds.
Piramal Enterp.
Quess Corp
SRF
S H Kelkar
Team Lease Serv.
Trident
V-Guard
1 Day (%)
2.2
-0.8
0.7
0.0
0.5
0.1
11.0
-3.8
-0.3
-0.5
-1.0
-0.6
1.0
0.1
-2.1
-2.5
0.5
-2.5
0.6
-1.1
0.2
-2.1
-1.1
0.2
-3.6
1M (%)
0.3
1.2
-2.2
1.2
-6.1
6.7
24.7
0.0
1.1
-4.1
8.9
-5.8
-5.4
-10.9
4.1
-4.8
8.4
0.5
-2.2
-0.7
-0.1
10.1
-4.7
-4.0
0.1
12M (%)
26.4
57.5
-4.1
79.0
213.1
84.1
27.9
-32.6
62.3
7.3
36.7
-29.2
13.7
21.7
63.2
14.9
67.3
59.4
18.0
-4.7
157.2
32.1
83.8
24 January 2018
40

THEMATIC/STRATEGY RESEARCH GALLERY

REPORT GALLERY
RECENT INITIATING COVERAGE REPORTS
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DIFFERENTIATED PRODUCT GALLERY

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Companies where there is interest
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13 December 2016
42