Market Strategy, May 2013

Market Strategy

Table of Contents
Strategy
2-6

Top Picks

9

Bajaj Electricals

8

DB Corp

10

Finolex Cables

12

Goodyear India

14

Indoco Remedies

16

ITNL

18

Mahindra Lifespaces

20

Relaxo Footwear

22

Tech Mahindra

24

United Phosporus

26

Stock Watch

29-33

May 2013

1

Market Strategy
May 2013 Top Picks
Company
Mid Caps Bajaj Electricals DB Corp Finolex Cables Goodyear India Indoco Remedies ITNL Mahindra Lifespace Relaxo Tech Mahindra United Phosphorus 170 250 53 268 64 174 397 620 952 155 237 290 68 345 89 230 476 791 1,170 232

CMP (`)

TP (`)

With new market highs in sight, midcaps to regain focus
Macroeconomic fundamentals turning positive
The moderation in inflation is a key positive for our economic outlook. Headline WPI inflation has decelerated to more than a three-year low at 4.9% in April 2013 as against 7.5% in April 2012. Going forward, we expect it to have a cascading effect on interest rates leading to higher savings and investments as well as to ease pressure on corporate margins and improve the growth outlook. The correction in global commodity prices has also come as a much-needed respite for the three major concerns for macroeconomic stability until now - 1) the current account deficit, 2) inflation and 3) fiscal deficit. We expect an improvement in the trade deficit for FY2014 as gold (notwithstanding the present front-ended surge in demand) and commodity imports moderate and exports revive on the back of global growth outlook and INR depreciation. Hence, we now expect the CAD to improve to 3.8%4.0% of GDP in FY2014 from about 5.0% of GDP in FY2013. We believe the government's commitment towards fiscal consolidation and positive steps aimed at reviving investment in the economy have presently averted threat of a sovereign ratings downgrade. Moreover easing crude prices along with the hike in administered fuel prices is likely to reduce under-recoveries and lend a positive bias for government finances. Overall, the outlook for global equity markets also looks optimistic owing to buoyant liquidity flows and favorable cues particularly from the United States and Japan. Coupled with that, tail-risks have been averted

Note: CMP as of May 24, 2013

Mid-caps have so far underperformed
(%) 130 120 110 100 90 80 May-12 Sensex Midcap Smallcap

Jul-12

Sep-12

Dec-12

Feb-13

May-13

Source: Angel Research

(concerns in the Euro area) and policymakers are gearing towards proactive policy action to revive economic growth and preserve financial stability.

Good time to invest in midcaps
Going ahead, we believe that with easing commodity prices, inflation being reined in and interest cost expected to come down, corporate earnings outlook and with a lag, investment outlook is likely to improve. We expect Sensex earnings to grow at a much healthier 14.5% over FY2013-15 as against 6.1% in FY2013. We believe that the Sensex is likely to make new highs in the coming months on the back of this improving domestic outlook and strong global liquidity flows. Midcaps have so far lagged behind the benchmark indices and defensive sectors. In our view, once the Sensex makes new highs, midcaps are likely to come into greater focus. So far it has primarily been defensive stocks that have driven the markets but going forward considering the sharp decline in inflation, the outlook for rate-sensitive sectors is also likely to improve. Accordingly, we recommend our top mid-cap picks, which comprise of a judicious mix of high quality businesses at reasonable valuations as well as few rate-sensitives.

Please refer to important disclosures at the end of this report.

2

Market Strategy
Liquidity cheers markets, global positives outweigh concerns
Global liquidity continues to remain buoyant as Japan has kick-started an aggressive liquidity easing program in its boldest move yet to revive the economy and tackle deflation in the economy. The Bank of Japan (BoJ) aims to achieve its inflation target of 2% in about 2 years. The central bank seeks to double its monetary base by injecting about 60-70 trillion yen (USD580bn-680bn) annually. The US Federal Reserve is already expanding its balance sheet by USD85bn every month and is unlikely to taper off its purchases until mid-2014. The moderation in inflation to 1.1% yoy in April 2013 as against 1.5% yoy in the previous month and 2.3% in April 2012 is also favorable to support its easy monetary policy stance. Economic growth in the US is gaining traction with real GDP growth for 1Q2013 coming at 2.5% qoq as against 0.4% qoq in 4Q2012. Lead indicators in the United States such as new home sales, jobless claims, consumer and business confidence also indicate optimism towards a recovery. Growth in Japan too surprised positively at 3.5% qoq in 1Q2013 as against 1.0% qoq in 4Q2012. Owing to the robust global liquidity and the signs of green shoots of growth in the US and Japan superseding concerns of sluggish growth in the Euro area and China, global equity markets are upbeat. Equity markets in the US are recording new-highs. The Nikkei - Japan's benchmark market index too reached its highest level in the last 5 and half years.

Macroeconomic fundamentals turning positive
Respite from elevated interest rates: The moderation in headline WPI inflation is a breather since it has remained uncomfortably high in the past 3 years, keeping interest rates at elevated levels. WPI inflation eased to 4.89% in April 2013 more than halving against its peak of 10.88% in April 2010. Core inflation - the non food manufactured component has moderated to 2.8% in April 2013, a 39-month low. In addition, inflation in food articles too has positively come off to 6.08% in April 2013 as compared to its 9.91% level in FY2013. The high interest rate has led to a 311bp decline in the investment rate to 35% in FY2012 as against 38.1% in FY2008. But the savings rate has decelerated more dramatically by 601bp to 30.8% of GDP in FY2012 from its peak of 36.8% in FY2008 as high inflation erodes the purchasing power of consumers. We thus expect a sustained fall in the inflation level to have a cascading effect, going ahead, on real interest rates leading to higher savings and investments as well as easing pressure on corporate margins and an improvement in the growth outlook. Although the Reserve Bank of India has remained hawkish in its guidance on monetary easing, it has taken a growth-supportive stance since December 2012. Since January 2013 in view of weaker pace of growth and moderation in inflation it brought the repo rate down by 75bp and the CRR has been slashed by 25bp. We expect positive surprise in inflation to provide room for the RBI to ease policy rates by an additional 50bp during FY2014. We expect monetary transmission of the rate cuts through the banking system (in the coming months) to give a fillip to economic growth and corporate earnings.

Exhibit 1: Performance of equity markets - 2013YTD
(%) 50.0 40.0 30.0 20.0 10.0 0.0

Exhibit 3: Inflation moderating within the comfort zone
China Shanghai Comp. Germany DAX HK HangSeng Japan Nikkei UK FTSE100 US S&P500 Eurozone EuroStoxx 50 Korea KOSPI India Sensex
(%) 10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 2.8 4.9

(10.0)

Source: Bloomberg, Angel Research

Exhibit 2: One-year forward P/E across various markets
Trading range - Lower end is 15th percentile, while higher is 85th
25.0 20.0 15.0 10.0 5.0 0.0

Apr-11

Aug-11

Oct-11

Jun-11

Feb-12

Apr-12

Aug-12

Oct-12

Jun-12

Dec-12

Feb-13

Core Inflation

WPI Inflation

Source: Office of Economic Adviser, Angel Research

Brazil

India

Japan

Germany

China

South Korea

Euro Zone

UK

Hong Kong

South Africa

Source: Bloomberg, Angel Research

May 2013

Russia

US

Apr-13

Current valuation

Dec-11

Median

3

Market Strategy
Exhibit 4: Breakup of major components in WPI inflation (%, yoy)
Weight All Commodities I Primary Articles II Fuel & Power III Manufactured Products 100.0 20.1 14.9 65.0 Apr -12 Apr-12 7.5 9.6 12.1 5.3 Dec-12 7.3 10.6 10.2 5.0 Jan-13 7.3 11.4 9.3 4.9 Feb -13 eb-13 7.3 10.5 10.6 4.8 Mar -13 Mar-13 6.0 7.6 10.2 4.1 Apr -13 Apr-13 4.9 5.8 8.8 3.4

Source: Office of Economic Adviser, Angel Research

CAD set to moderate: Recent correction in crude oil and gold prices are a positive tailwind for our CAD since these items together contribute about 45% to our total import bill. Oil imports reported moderate growth of 3.9% in April as against 4.2% in the corresponding month of the previous year as India's crude basket declined by 13.4% yoy in April 2013. The decline in gold prices has led to a surge in demand and as volumes increased, imports of gold and silver reported growth of 136% yoy during April 2013. We believe that this can be attributed to front-ended consumer demand. Investment demand for gold is also expected to moderate as the precious metal has shed 18% of its value in

USD terms since the beginning of 2013 making equities a more attractive investment class globally. Another positive is that exports are showing signs of revival and growth in exports is in the positive territory for the third straight month at 1.7% in April 2013 as compared to 7.0% in the previous month. We believe the CAD has peaked at its record-high of 6.7% of GDP in 3QFY2013 and with a recovery in exports along with benign commodity prices it is likely to moderate to about 3.8 - 4.0% of GDP in FY2014 from about 5.0% of GDP in FY2013.

Exhibit 5: Softening of commodity and crude prices
(USD/bbl) 140.0 ( Index) 380.0 350.0 120.0 320.0 100.0 290.0 260.0 80.0 230.0 60.0 May-11 200.0 May-13

Exhibit 6: Decline in gold prices
(USD/oz) 2,000 1,900 1,800 1,700 1,600 1,500 1,400 1,300 1,200
May-11 Nov-11 Aug-11 May-12 Nov-12 Aug-12 Feb-12 May-13 Feb-13

Aug-11

Nov-11

Feb-12

May-12

Aug-12

Nov-12

Feb-13

WTI Crude price

Brent Crude price

CRB commodity index

Source: Bloomberg, Angel Research

Source: Bloomberg, Angel Research

Exhibit 7: Trends in Balance of Payments (in USD bn)
4QFY12 A . Current Account Balance I. Trade balance a) Exports b) Imports II. Invisibles a) Services b) Transfers c) Income B. Capital account I. Foreign Investment II. Loans III. Banking Capital IV. Rupee debt service V. Other capital C. Errors and omissions D. Overall Balance
Source: RBI, Angel Research

1QFY13 (16.7) (42.4) 76.7 119.1 25.8 14.1 16.6 (4.9) 16.3 2.0 6.2 9.4 (0.0) (1.2) 0.9 0.5

2QFY13 (22.8) (48.3) 69.8 118.1 25.5 15.2 15.9 (5.6) 23.6 16.6 5.3 5.5 (0.0) (3.8) (1.0) (0.2)

3QFY13 (32.5) (59.6) 71.8 131.4 27.1 17.6 15.7 (6.3) 31.8 11.3 10.6 5.3 0.0 4.5 1.6 0.8

Apr -Dec 2012 Apr-Dec (56.4) (138.2) 229.6 367.8 81.9 46.6 46.7 (11.4) 51.2 23.9 16.6 14.2 (0.0) (3.5) (1.9) (7.1)

Apr -Dec 2013 Apr-Dec (72.0) (150.3) 218.4 368.7 78.3 46.9 48.3 (16.8) 71.6 29.9 22.1 20.2 (0.0) (0.5) 1.5 1.1

(21.8) (51.5) 80.2 131.7 29.8 17.5 16.8 (4.6) 16.6 15.3 2.7 2.0 (0.0) (3.4) (0.6) (5.7)

May 2013

4

Market Strategy
In absolute terms our CAD is the second-largest in the world following the U.S. But we do not see any imminent threat to macroeconomic stability since 1) India remains amongst the favored emerging markets for foreign investors and we expect risk-on trade to bring in robust FII inflows and 2) the real interest rate differential in India vis-à-vis advanced economies is likely to be a pull factor for debt-related capital flows. During the April - December period of FY2013 although the CAD stood at USD72bn as against USD56.4bn in the corresponding period of the previous year it remained comfortable to finance without resulting into drawing down of forex reserves owing to buoyant capital inflows in the economy.

Exhibit 8: Real interest rate differential vis-a-vis United States (in %)
Current acc./GDP India FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 Latest (Apr 13)
Source: RBI, Bloomberg, Angel Research

Capital acc./GDP India 1.20 2.60 2.20 2.60 3.10 5.00 2.30 4.80 3.40 2.70 5.20

Nominal interest rate India 5.88 4.73 5.25 5.97 6.98 7.49 7.22 4.49 6.49 8.26 8.00 7.62 US 1.76 1.22 2.34 4.01 5.03 3.82 1.45 0.42 0.30 0.15 0.17 0.12

Nominal interest rate differential (India - US) 4.12 3.51 2.91 1.96 1.95 3.67 5.77 4.07 6.19 8.11 7.83 7.50

Inflation rate (%, yoy) India 3.38 5.47 6.47 4.44 6.59 4.73 8.06 3.81 9.56 8.94 7.38 4.89 US 1.99 2.00 2.99 3.54 2.92 3.27 2.79 0.24 1.59 3.32 1.70 1.10

Inflation differential (India - US) 1.39 3.47 3.48 0.90 3.66 1.46 5.27 3.57 7.97 5.62 5.68 3.79

Real interest rate India 2.50 (0.74) (1.22) 1.53 0.39 2.75 (0.84) 0.68 (3.06) (0.68) 0.62 2.73 US (0.23) (0.78) (0.65) 0.47 2.11 0.55 (1.34) 0.18 (1.29) (3.17) (1.53) (0.98)

Real interest differential (India - US) 2.73 0.04 (0.57) 1.06 (1.72) 2.20 0.50 0.50 (1.77) 2.49
at decadal high

1.20 2.30 (0.40) (1.20) (1.00) (1.30) (2.30) (2.80) (2.70) (4.20) (5.00)

2.42

3.71

Exhibit 9: Stable foreign exchange reserves
(USD bn) 320.0 300.0 280.0 260.0

Exhibit 10: Fiscal deficit treading positively - key to ratings outlook
(% of GDP) 7.0 6.0 6.0 5.0 4.0 3.0 2.5 4.8 6.5 5.7 5.2 4.8

240.0 220.0
Dec-09 Feb-10 Feb-11 Dec-10 Dec-11 Feb-12 Aug-09 Aug-10 Aug-11 Aug-12 Dec-12 Feb-13 Apr-09 Jun-09 Oct-09 Apr-10 Jun-10 Oct-10 Apr-11 Jun-11 Oct-11 Apr-12 Jun-12 Oct-12 Apr-13

2.0 1.0 0.0 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014

Source: RBI, Angel Research

Source: Budget documents, Angel Research

Focus on fiscal consolidation key: The key positive for government finances is the hike in administered fuel prices and its resultant impact on reducing under-recoveries and narrowing the fuel subsidy. Post the government's move towards allowing OMCs to hike diesel tariff in a calibrated manner, diesel prices have been hiked for the fourth time in 2013. In addition aided by easing of global prices, the under-recovery on diesel has come down multifold to Rs. 3.7/litre in May 2013 as against Rs. 13.64/litre during the corresponding period of the previous year. We expect underrecoveries on fuel to ease dramatically by 30-40% from 1.6lakh crores in FY2013.

Although the government has refrained from populist measures in the budget, it is politically motivated to move the food security bill in parliament before the elections. We believe this legislation could push up the food subsidy bill to about Rs. 1.2lakh crore from the budgeted Rs. 90,000 crore. But similar to the previous year we expect the government to take measures to curtail plan expenditure which is budgeted to rise by 29.4% in FY2014 in order to avert any major slippage in the fiscal deficit budgeted at 4.8% of GDP in FY2014.

May 2013

5

Market Strategy
Normal monsoon expected - positive for growth and inflation: The IMD has forecast a normal south-west monsoon in 2013 attributing it with a probability of 46%. But the probability of below-normal monsoon also remains high at 27%. Monsoon rainfall is estimated at 98% of the Long Period Average (LPA) with a +/-5% model error. Due to below-normal rainfall during FY2013 affecting kharif production, growth in total food-grain production for the period is estimated to decline by 1.5%. We expect normal rainfall to boost agricultural production in FY2014 taking growth in agriculture higher to about 3.5% in FY2014 from 1.8% expected by the CSO in its advance estimates for FY2013 and thus keep food inflation in check as well. Exhibit 11: Probability of Southwest monsoon rainfall in 2013
Total quantum < 90% of LPA 90-96% of LPA 96-104% of LPA 104-110% of LPA > 110% of LPA Classification Deficient Below-normal rainfall Near-normal rainfall Above normal rainfall Excess rainfall Probability 10% 27% 46% 14% 3%

Midcaps have so far lagged behind the benchmark indices and defensive sectors. In our view, once the Sensex makes new highs, midcaps are likely to come into greater focus. So far it has primarily been defensive stocks that have driven the markets but going forward considering the sharp decline in inflation, the outlook for rate-sensitive sectors is also likely to improve. Accordingly, we recommend our top mid-cap picks, which comprise of a judicious mix of high quality businesses at reasonable valuations as well as few rate-sensitives.

Exhibit 12: Sensex one-year forward P/E
30.0 25.0 20.0 15.0 10.0 5.0 Mar-01

Mar-03

Mar-05

Mar-07

Mar-09
15 year Avg

Mar-11
5 year Avg

Mar-13

Sensex 1 year forward P/E

Source: Angel Research

Exhibit 13: Sensex EPS growth over FY2013-15E
(` )
1,700 1,500
% gr 15.3 owth

Source: IMD, Angel Research

1,562

Outlook and Valuation
Going ahead, we believe that with easing commodity prices, inflation being reined in and interest cost expected to come down, corporate earnings outlook and with a lag, investment outlook is likely to improve. We expect Sensex earnings to grow at a much healthier 14.5% over FY2013-15 as against 6.1% in FY2013. We believe that the Sensex is likely to make new highs in the coming months on the back of improving domestic outlook and strong global liquidity flows.

1,300 1,100 900 700 500 FY2013E 1,192

wth % gro 13.6

1,354

FY2014E

FY2015E

Source: Angel Research

May 2013

6

Market Strategy

Top Picks

May 2013

7

Market Strategy

Bajaj Electricals
Penetration in rural market through exclusive 'Bajaj world' stores: Growing disposable incomes in rural India is poised to fuel the growth in the electrical appliances. BEL, hence, plans to capitalize on growth in rural markets by penetrating through its outlets 'Bajaj World' in rural India which are opened mainly through the franchise route displaying all the products of BEL. BEL targets to open ~50 stores in rural India (of total 100 stores pan-India) by next year. In addition, the company has plans to launch rural-specific brand to tap price sensitive segment under the Bajaj umbrella. Products under this economy brand will have different finish, designs and will be priced much lower than existing products of BEL. Thus, with expansion of the customer base, and fresh demand coming in, the top-line of the company assures decent growth visibility.

Price - `170 Target Price - `237
Leveraging on strong brands to compliment the distribution network
BEL has a strong brand positioning and a well-spread distribution network. BEL has collaborated with known brands in each of its segments which have enabled it to grow at a robust pace over the years and continue to do so. Strong brand association
Brand Trilux Lenze (Germany) Disano (Italy) Delta Controls (Canada) Rudd (US) Morphy Richards (UK) Nardi (Italy) Disney (USA) Media (China) Securiton (Switzerland)
Source: Company

Products Luminaries Street lights Building management systems LED Electrical appliances Electrical appliances Fans Fans Fire alarm system

Provisions owing to closure of old E&P projectsConservative stand
BEL's E&P division (~25-30% over FY2010-12 of net sales) has its EBIT margin contracting significantly since FY2010 from 10.7% to 3.3% in FY2012 on account of delayed execution of projects and cost overruns. BEL has closed 20 such sites up-till 3QFY2013 and expects to carry forward 9 old sites in FY2014 which are scheduled to be closed in 1HFY2014. However, until the closure of these sites, the company has decided to take a conservative stand and create provisions on these projects by making a provision of `17cr in 3QFY2013 which impacted the bottomline and is expected to further hurt in 4QFY2013. However, the company has become very selective in order intake by focusing more on profitability (with double digit operating margins) rather than revenue growth. On account of this, we expect the segment to register an EBIT loss of `124cr for FY2013E and gradually report EBIT of `38cr in FY2015E. Margin trend reversal for E&P segment
900 800 700 600
( ` cr)

Outlook and V aluation Valuation
We believe consumer appliances and new product launches will fuel growth going ahead and drive the top-line at a 14.9% CAGR over FY2013-15E to `4,472cr. The EBITDA is expected to grow at 70.9% CAGR, owing to lower base. Further, we expect the company's EBITDA margin to rise from 3.3% in FY2013E to 7.2% in FY2015E on the back of revival in E&P segment. A strong topline growth coupled with operating performance will aid the PAT to register a CAGR of 96.7% to `197cr over FY2013-15E. At current market price of `170, the stock is available at PE of 8.6x for FY2015E earnings. We recommend Buy on the stock with a target price of `237 based on a target PE of 12x for FY2015E earnings. One-year forward PE

10.7

8.9

3.3 5.4 (18.1) 1.8

15 10 5
(%)

400 350 300 250
(`)

500 400 300 200 100 0 FY2010 FY2011 FY2012 FY2013E FY2014E FY2015E

0 (5) (10) (15) 737 832 834 688 695 702 (20)

200 150 100 50 0
May-08 May-09 May-10 May-11 May-12 Nov-12 May-13 Nov-08 Nov-09 Nov-10 Nov-11

E&P Revenue

EBIT Margin (%)

Price

3x

10x

17x

24x

Source: Company, Angel Broking

Source: Company, Angel Broking

December 2010

8

Market Strategy
Profit & Loss Statement
Y/E March (` cr) Total operating income % chg Total Expenditure Net Raw Materials Other Mfg costs Personnel Other EBITD A EBITDA % of net sales Depreciation& Amortisation EBIT Interest & other Charges Other Income Recurring PBT ax Net T Tax (% of PBT) PAT (reported) Extraordinary Expense/(Inc.) ADJ .P AT ADJ. PA FY2012 3,099 13.0 2,862 2,280 86 140 356 237 7.7 13 225 63 14 162 58 33.0 118 118 FY2013 FY2014E FY2015E 3,388 9.3 3,277 2,668 62 167 380 110 3.3 14 96 69 17 27 18 40.6 26 (25) 51 3,885 14.7 3,676 3,037 71 179 389 210 5.4 16 194 62 31 132 54 33.0 109 109 4,472 15.1 4,150 3,452 72 201 425 322 7.2 17 305 56 45 249 97 33.0 197 197

Balance Sheet
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders F unds Funds Total Loans Long term provision Net Deferred Tax Liability T otal Liabilities Total APPLICA TION OF FUNDS APPLICATION Gross Block Less: Acc. Depreciation less: impairment of assets Net Block Investments 272 85 3 184 44 335 100 3 232 30 73 265 1,550 1,244 306 906 368 116 3 250 33 73 253 1,753 1,395 358 966 405 133 3 269 36 73 268 2,045 1,575 470 1,116 20 680 700 187 19 (1.9) 905 20 709 729 160 25 (7.9) 906 20 785 805 144 25 (7.9) 966 20 950 970 130 25 (7.9) 1,116 FY2012 FY2013 FY2014E FY2015E

Long term loans and Advances 109 Other non current assets Current Assets Current liabilities Net Current Assets T otal Assets Total 186 1,423 1,045 378 905

Cash Flow Statement
Y/E March (` cr) Profit Before Tax Depreciation Other Income Change in WC Direct taxes paid Cash Flow from Operations (Incr)/ Decr in Fixed Assets (Incr)/Decr In Investments Other Income Cash Flow from Investing Issue of Equity/Preference Incr/(Decr) in Debt Dividend Paid (Incl. Tax) Others Cash Flow from F inancing Financing FY2012 176 13 (14) (77) (58) 39 (77) (19) 14 (82) 0 79 (28) (3) 48 FY2013 FY2014E FY2015E 44 14 (17) 44 (18) 68 (138) 51 17 (71) 0 (28) (24) 52 (0) (3) 54 50 (48) (11) 50 39 (47) 33 39 72 163 16 (31) (63) (54) 31 (21) (3) 31 7 0 (16) (32) 294 17 (45) (79) (97) 91 (53) (3) 45 (11) 0 (14) (32)

Key Ratios
Y/E March P er Share Data (`) Per EPS (Basic) Cash EPS DPS Book Value Operating ratios (x) Inventory (days) Debtors (days) Creditors (days) Returns (%) ROE ROCE Angel ROIC V aluation Ratio (x) Valuation P/E (on FDEPS) P/E (Cash EPS) P/BV EV/Sales EV/EBITDA 14.4 13.0 2.4 0.6 7.5 33.4 26.0 2.3 0.5 16.1 15.6 13.6 2.1 0.5 8.4 8.6 7.9 1.8 0.4 5.3 16.8 24.8 27.9 7.0 10.6 11.6 13.5 20.1 21.7 20.3 27.3 30.2 38 109 121 49 109 121 47 109 121 47 109 121 11.8 13.1 2.8 70.2 5.1 6.5 2.8 73.1 10.9 12.5 2.8 80.8 19.7 21.5 2.8 97.3 FY2012 FY2013 FY2014E FY2015E

Incr/(Decr) In Balance Sheet Cash5 Opening Cash balance Closing cash balance 49 54

May 2013

9

Market Strategy

DB Corp
DB Corp is one of the leading publishing houses in India, with seven newspapers and 65 editions in four languages across 13 states. Its combined average daily readership is 19.2mn readers, which makes it the most widely read newspaper group in India. The company has an advertising focused revenue model with average cover prices being lowest among its peers at `2.6.
( ` cr)

Price - `250 Target Price - `290
(however, it may consider smaller launches in Maharashtra); we believe that the losses would decline further. Reduction in losses of emerging editions
0 (17) (5) (11) (10) (15) (20) (25) (79) (76) (44) (57) (27) (22) (15) (23) (17) (20) (12) (10) (6) (6) 0 (10) (20) (30) (50) (60) (70) (80) (90)

Revival in ad growth: After four consecutive quarters of single digit advertising growth (due to slower GDP growth), ad growth has bounced back to double digit from 3QFY2013. The company expects ad growth momentum to continue driven by hike in ad yields. Double digit advertising revenue growth
350 15 300 250 17 7 5 (0) 3 11 18 13 16 14 12 10 8 150 100 50 0 6 4 2 0 (2)

1Q12

2Q12

3Q12

EBITDA

4Q12

1Q13

Source: Company, Angel Research

Revival in ad growth coupled with stable newsprint prices and reduction in losses of emerging editions is expected to improve DB Corp's margin.
(%)

( ` cr)

200

Outlook & Valuation
The stock is currently trading at 14.8x FY2015E consolidated EPS of `16.8(at 2% premium to Sensex target multiple). However, considering the structural positives of print business (high brand loyalty and significant entry barriers) and DBCL's multistate leadership, in our view, the stock deserves a higher premium to Sensex. Hence, we assign a target multiple of 17x FY2015E EPS, benchmarking it to our print media sector valuations (which are at 15% premium to Sensex) and maintain our Buy view on the stock with a target price of `290. One year forward P/E
350 300

271

275

287

263

270

283

318

1Q12

2Q12

Advertising revenue (LHS)

3Q12

4Q12

1Q13

yoy growth (RHS)

Source: Company, Angel Research

Stable newsprint prices: Although newsprint prices are up 6.4% yoy to `33,388 in 4QFY2013 (due to 7.9% yoy depreciation of INR vs USD), the average newsprint prices have declined sequentially from 3QFY2013 and are stabilizing in the range of `33,000 to `34,000. Newsprint price trend

Share Price (`)

800 750 700
(USD/tonne)

2Q13

3Q13

4Q13

298

40,000 35,000 30,000 25,000 20,000 15,000 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 INR/tonne Dec-11 Dec-12 USD/tonne
(INR/tonne)

250 200 150 100

650 600 550 500 450 400 Dec-05

Feb-11

Feb-12

2Q13

OPM

3Q13

4Q13

Jun -11

Oct -10

Oct -11

Jun -12

Apr-11

Apr-12

Oct -12

Feb-13

Aug-11

Aug-12

Dec-10

Dec-11

12x

15x

18x

21x

Source: Company, Angel Research

Source: Company, Angel Research

Reduction in losses of emerging editions: DB Corp has reduced its losses in emerging editions from `77cr in FY2012 to `34cr in FY2013. Since the company is not expected to undertake any major launch as entry in new markets is on the backburner

December 2010

Dec-12

Apr-13

10

(%)

(40)

Market Strategy
Profit & Loss Statement
Y/E March (` cr) Total operating income % chg Total Expenditure % chg EBITD A EBITDA % chg (% of Net Sales) Depreciation& Amortisation EBIT Interest & other Charges Other Income PBT Tax (% of PBT) PAT % chg (% of Net Sales) Basic EPS (`) % chg FY2012 1,451 15.2 1,115 29.3 336 (15.4) 23.2 51 286 9 24 300 98 32.7 202 (22.4) 13.9 11.0 (21.9) FY2013 FY2014E FY2015E 1,593 9.8 1,216 9.1 377 12.1 23.7 58 318 8 21 332 113 34.2 219 8.2 13.7 11.9 8.2 1,750 9.9 1,310 7.7 440 16.8 25.1 63 377 8 19 389 128 33.0 261 19.2 14.9 14.2 19.2 1,925 10.0 1,412 7.8 513 16.5 26.6 69 444 6 21 459 152 33.0 308 18.1 16.0 16.8 18.1

Balance Sheet
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders F unds Funds Minority Interest Total Loans Deferred Tax Liability Other long term liablities Total Liabilities APPLICA TION OF FUNDS APPLICATION Net Block Goodwill Investments Long term loans and adv. Current Assets Current liabilities Net Current Assets Mis. Exp. not written off Total Assets 760 33 46 87 610 329 281 9 1,217 801 37 81 85 622 349 273 6 1,282 855 37 106 99 690 346 344 6 1,447 902 37 128 99 822 356 466 6 1,639 183 744 927 2 180 75 33 1,217 183 844 1,028 1 137 83 33 1,282 183 1,019 1,202 1 127 83 33 1,447 183 1,241 1,424 1 97 83 33 1,639 FY2012 FY2013 FY2014E FY2015E

Cash Flow Statement
Y/E March (` cr) Profit before tax Depreciation Change in Working Capital Interest / Dividend (Net) Direct taxes paid Others Cash Flow from Operations (Inc.)/ Dec. in Fixed Assets FY2012 300 51 (73) 9 98 0 189 (127) FY2013 FY2014E FY2015E 332 58 (44) 8 113 0 241 (99) (34.69) (134) (43) 86 (4) (125) (18) 136 119 389 63 (17) 8 128 (12) 301 (117) (25.00) (142) (10) 86 (4) (92) 68 119 187 459 69 (51) 6 152 (11) 321 (117) (22.00) (139) (30) 86 (6) (110) 72 187 259

Key Ratios
Y/E March Valuation Ratio (x) P/E (on FDEPS) P/CEPS P/BV EV/Sales EV/EBITDA Per Share Data (`) EPS (Basic) Cash EPS DPS Book Value Returns (%) ROCE ROE Turnover ratios (x) Inventory / Sales (days) Receivables (days) Payables (days) 30 62 27 30 63 22 26 63 25 26 63 24 24.7 23.0 25.5 22.4 27.6 23.4 28.8 23.4 11.0 13.8 3.7 50.1 11.9 15.1 4.0 55.7 14.2 17.6 4.0 65.2 16.8 20.5 4.0 77.3 22.7 18.1 5.0 3.1 13.5 20.9 16.5 4.5 2.8 12.0 17.6 14.2 3.8 2.5 10.0 14.9 12.2 3.2 2.3 8.4 FY2012 FY2013 FY2014E FY2015E

(Inc.)/ Dec. in Investments (29.73) Cash Flow from Investing Issue of Equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Interest / Dividend (Net) Cash Flow from F inancing Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances (157) 0.55 8 80 (2) (69) (36) 173 136

May 2013

11

Market Strategy

Finolex Cables
Reducing copper rods sale, end of derivative contracts to boost margins: FCL sold the excess production of copper rods segment (initially set up as backward integration for the cables segment) to third parties at market price. However, owing to thin and declining margins from third party transactions, FCL is gradually reducing its third party exposure (from 21% in FY2010 to ~8% currently). This trend is expected to continue, thereby improving the overall EBITDA margin of the company. Further, with the end of the forex derivatives contract which has weighed on the bottom line since FY2009, the company is expected to directly enhance its bottom line. Segmental contribution
3,000 2,500 2,053 2,000 1,771 1,407 1,109 1,000 500 0 FY2010 FY2011 Electrical cables FY2012 FY2013 Communication FY2014E CCC rods rods CCC FY2015E 362 511 205 105 94 85 2,347 2,683

Price - `53 Target Price - `68
Also, FCL's management is quite optimistic for its recent bidding for tender of 400,000km of optic fibre cables (floated by Bharat Broadband Network Ltd.). The tender, if won, will significantly fortify the communication segment's order book of the company.

Outlook and V aluation Valuation
We remain positive on the company's prospects going ahead, given the strong growth in user industry, additions in product portfolio, and strategic alliance which are all expected to aid the company in posting a CAGR of 13.0% in the top-line over FY2013-15E to `2,899cr in FY2015E. EBITDA is expected to post a CAGR of 11.2% to `285cr while margins are to stabilize at 9.8% in FY2014E and FY2015E. PAT growth, despite closure of the derivatives contracts (included in exceptional items) is expected to be restricted to 9.0% CAGR over FY2013-15E to `173cr in FY2015E owing to end of tax exemption. At current market price, the stock is available at valuation of 4.8x PE for and 0.7x PBV FY2015E. The valuation seems cheap as compared to its 3 year historical average PE of 7.4x. We have valued the stock at PE of 6.0x for FY2015E earnings and arrived at a target price of `68. W e recommend a Buy on the stock. We One-year forward PE
200 180 160 140 120 100 80 60 40 20 0
Nov-10 May-10 May-12 May-11 Nov-12 Nov-11 May-13

( ` cr)

1,500

Source: Company, Angel Broking

Robust growth in user industries: Growth for electrical cables is expected to be robust owing to 1) Electrification on an uptrend 2) Government's initiative for underground power transmission (available only in metros as of now) and 3) Customers increasingly demanding high-quality and branded wires. Considering significant contribution of electrical cables (~85% of net sales) and substantial market share of FCL (~15-20% in the electrical cables segments), the growth in user industry will provide potential revenue visibility for the company. User industry growth to drive volumes
3,500 3,000 2,500
( ` cr)

(`)

Price

4.0x

7.5x

11.0x

14.5x

Source: Company, Angel Broking

30 25 25.8 20 20.7 12.9 10.0
1,619 2,036 2,064 2,270 2,563 2,899

2,000 1,500 1,000 500 0

13.1

15 10 5 0

1.4

FY2010

FY2011 FY2012 Net sales (LHS)

FY2013 FY2014E FY2015E Net sales growth (RHS)

Source: Company, Angel Broking

December 2010

(%)

12

Market Strategy
Profit & Loss Statement
Y/E March (` cr) Net Sales % chg Total Expenditure Net Raw Materials Other Mfg costs Personnel Other EBITD A EBITDA % of net sales Depreciation& Amortisation EBIT Interest & other Charges Other Income Recurring PBT Exceptional item PBT (reported) Net Tax (% of PBT) PAT (reported) FY2012 2,064 1.4 1,889 1,568 84 69 167 175 8.5 39 135 26 36 109 36 109 11 10.1 98 FY2013 FY2014E FY2015E 2,270 10.0 2,041 1,689 113 85 156 229 10.1 47 182 13 24 170 23 171 26 15.0 145 2,563 12.9 2,312 1,914 127 95 176 250 9.8 48 202 17 31 185 216 62 28.0 154 2,899 13.1 2,614 2,163 144 108 199 285 9.8 51 234 16 24 218 242 69 28.0 173

Balance Sheet
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders F unds Funds Total Loans Other long term liability Net Deferred Tax Liability Total Liabilities APPLICA TION OF FUNDS APPLICATION Gross Block Less: Acc. Depreciation Net Block Capital Work-in-Progress Long term loans nd advances Investments Other non current assets Current assets Current liabilities Net Current Assets Total Assets 871 442 429 12 4 237 534 194 340 1,022 937 489 448 17 324 19 596 229 368 1,175 993 537 456 17 331 19 663 213 451 1,273 1,072 588 484 17 364 19 770 240 530 1,413 31 770 800 155 35 33 1,022 31 894 924 162 54 34 1,175 31 1,048 1,078 151 22 22 1,273 31 1,220 1,251 140 9 14 1,413 FY2012 FY2013 FY2014E FY2015E

Cash Flow Statement
Y/E March (` cr) Profit Before Tax Depreciation (Inc)/Dec in working capital Direct taxes paid Less: Other Income Cash Flow from Operations (Incr)/ Decr in Fixed Assets (Incr)/Decr in Investments Other Income Cash Flow from Investing Issue of Equity/Preference Incr/(Decr) in Debt Dividend Paid (Incl. Tax) Others Cash Flow from F inancing Financing FY2012 109 39 (65) (11) (36) 36 (39) 18 36 16 0 11 (12) (23) (24) FY2013 FY2014E FY2015E 171 47 (37) (26) (24) 131 (72) (100) 24 (148) 0 29 0 (7.2) 22 5 49 54 216 48 (91) (62) (31) 80 (56) (6) 31 (32) 0 (56) 0 (56) (8) 40 32 242 51 (73) (69) (24) 127 (79) (33) 24 (88) 0 (32) 0 (32) 6 32 38

Key Ratios
Y/E March P er Share Data (`) Per EPS (Basic) Cash EPS DPS Book Value Operating ratios (x) Inventory (days) Debtors (days) Creditors (days) Returns (%) ROE ROCE Angel ROIC V aluation Ratio (x) Valuation P/E P/E (Cash EPS) P/BV EV/Sales EV/EBITDA 8.3 5.9 1.0 0.3 3.9 5.6 4.2 0.9 0.3 2.7 5.3 4.0 0.8 0.2 2.4 4.7 3.6 0.7 0.2 1.9 12.3 13.2 18.7 15.7 15.5 22.5 14.3 15.9 22.2 13.8 16.5 23.1 50 16 47 49 16 47 47 16 47 47 16 47 6.4 9.0 0.8 52.3 9.5 12.5 0.8 60.4 10.1 13.2 0.8 70.5 11.3 14.6 0.8 81.8 FY2012 FY2013 FY2014E FY2015E

Incr/(Decr) in Balance Sheet Cash28 Opening cash balance Closing cash balance 21 49

May 2013

13

Market Strategy

Goodyear India
Investment rationale
Branded business in the commodity industry GIL caters to high-end brands such as Audi, BMW, Land Rover, Mitsubishi and Porsche and has a brand name in the commodity business with a stupendous RoIC of 65.1% for CY2012 in comparison to less than 30% in case of other listed peers.

Price - `268 Target Price - `345
shipments, has led to an increase in international rubber prices in the past three months. This would consequently result in lower rubber imports by India. But considering the overall bearish trend in the global market, prices are expected to remain relatively low over the next one to two quarters. Rubber price trend
250 234 230

Pickup in farm equipment sector to sustain revenue
The farm equipment sector in India after growing for four farm OE business grew by a marginal 2.0% inspite of a decline in industry growth. Moreover, the company's farm replacement business registered a 14% yoy growth, much higher than that of the industry. The domestic farm equipment sector has witnessed a pickup in April with a 30%+ volume growth. Since, GIL has major part of its revenue contributed through the farm equipments we believe a pickup in the segment will result in sustainable revenue.
170
(`/kg)

consecutive years witnessed a decline in FY2013. However, GIL

210

190

150 May-11

158 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13

Source: Company, Angel Broking

Tyre companies have taken price cuts during 1QCY2013. The price cuts have however been offset by a decline in rubber prices. Lower rubber prices have been and are expected to be beneficial for Goodyear and other tyre companies. But this would only be in the short term as in the long term the EBITDA margins will contract slightly owing to the price cuts that have been taken.

Declining rubber prices to drive short term profits
Rubber prices have been volatile in the last two years. Since rubber constitutes a major proportion of the raw material cost for tyre companies, volatility in its price has impacted the profitability of these companies. Rubber prices have currently declined due to a number of reasons. A slowdown in production in the automobile segment has been one of the major reasons for the fall in demand of rubber. Moreover, due to favorable international prices, import of natural rubber through duty free channels accounted for 46% of the total rubber supply in the domestic market during the Apr- Dec 2012 period. This led to piling up of inventory at projected levels of 2,90,000 tonne, thus resulting in a decline in domestic rubber prices. According to an International Rubber Study Group (IRSG) report, global production in the April-December 2012 period rose 3.2%, while consumption fell by 1.1%. IRSG estimates 2012 global production and consumption of natural rubber at 11.41 and 10.95 million tonne, respectively, with a surplus of 4,60,000 tonne. While in 2013, production and consumption are expected to be at 11.77 and 11.59 million tonne, respectively, with a surplus of 1,79,000 tonne. The onset of dry season in Thailand (world's biggest rubber producer), when rubber supply reduces by 50%, is expected to result in increase in price. However, this rise would be offset by the Thai government's decision to discontinue its rubber buying scheme; thus leading to relatively stable international rubber prices. However, Thailand's decision to join key exporters- Indonesia and Malaysia, to restrict

Outlook and V aluation Valuation
We expect GIL to post a marginal 2.0% CAGR in topline to `1,542cr over CY2012E-14E on account of sluggishness in auto industry. However, lower raw material prices would result in expansion of EBITDA margin by 283bp over CY2012-14E to 9.0% in CY2014E. Consequently, the net profit is expected to witness a 23.2% CAGR to `85cr in CY2014. At the current market price, the stock is trading at 7.2x its CY2014E earnings. We upgrade the stock to Buy recommendation with a revised target price of `345, based on a target PE of 9.0x for CX2014E . CX2014E. One-year forward PE
600 500 400
(`)

300 200 100 0 May-08

May-09 Price

May-10 2x

May-11 6x 10x

May-12 14x

May-13

Source: Company, Angel Broking

December 2010

14

Market Strategy
Profit & Loss Statement
Y/E Dec. (` cr) Total operating income % chg Total Expenditure Net Raw Materials Personnel Other EBITD A EBITDA (% of Net Sales) Depreciation& Amortisation EBIT Interest Other Income (% of Net Sales) Recurring PBT Extraordinary Expense/(Inc.) PBT (reported) Tax PAT (reported) ADJ .P AT ADJ. PA CY2011 CY2012E CY2013E CY2014E 1,513 16.7 1,406 1,133 73 201 107 7.1 20 87 5 14 0.6 82 0.0 96 32 65 65 1,481 (2.1) 1,391 1,102 81 207 91 6.1 24 67 4 22 0.6 63 0.0 85 28 56 56 1,458 (1.6) 1,337 1,051 80 206 121 8.3 26 94 4 21 0.6 90 0.0 112 37 74 74 1,542 5.8 1,404 1,108 83 213 138 9.0 29 109 4 23 0.6 105 0.0 128 43 85 85

Balance Sheet
Y/E Dec. (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders’ F unds Funds Total Loans Long Term Provisions Deferred Tax Liability (Net) Total Liabilities APPLICA TION OF FUNDS APPLICATION Gross Block Less: Acc. Depreciation Net Block Capital Work-in-Progress Long Term Loans and adv. Current Assets Cash Loans & Advances Inventory Debtors Current liabilities Net Current Assets Total Assets 373 184 190 20 15 474 249 9 85 131 353 121 345 398 201 198 17 19 507 238 10 104 154 357 150 384 438 227 211 20 19 520 273 9 94 144 330 190 440 482 256 226 20 19 586 325 9 100 152 346 240 505 23 293 317 0 18 11 345 23 331 354 0 19 11 384 23 387 410 0 19 11 440 23 452 475 0 19 11 505 CY2011 CY2012E CY2013E CY2014E

Cash Flow Statement
Y/E Dec. (` cr) Profit before tax Depreciation Change in Working Capital Direct taxes paid Others Cash Flow from Operations (Inc.)/Dec. in Fixed Assets (Inc.)/Dec. in Investments (Incr)/Decr In LT loans & adv. Others Cash Flow from Investing Issue of Equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Others Cash Flow from F inancing Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances CY2011 CY2012E CY2013E CY2014E 96 20 (7) (32) 0 78 (29) 0 14 (8) (24) 0 0 (19) (4) (23) 31 218 249 85 24 (40) (28) (14) 26 (23) 0 4 5 (14) 0 0 (19) (4) (23) (11) 249 238 112 26 (1) (37) (21) 78 (42) 0 0 21 (21) 0 0 (19) 0 (19) 39 238 277 128 29 2 (43) (23) 93 (44) 0 0 23 (21) 0 0 (20) 0 (20) 52 277 329

Key Ratios
Y/E Dec. P er Share Data (`) Per EPS (Basic) Cash EPS DPS Book Value Operating ratio Inventory/Net sales (days) Receivables (days) Payables (days) Returns (%) ROE ROCE (Pre-tax) Angel ROIC (Pre-tax) Valuation Ratio (x) P/E (on FDEPS) P/CEPS P/BV EV/Net sales EV/EBITDA 9.6 7.3 2.0 0.2 3.3 11.0 7.7 1.7 0.3 4.2 8.3 6.1 1.5 0.2 2.8 7.2 5.4 1.3 0.2 2.1 22.0 29.7 475.9 16.8 18.3 65.1 19.5 22.9 69.6 19.3 23.1 73.2 18 10 86 23 11 86 25 11 90 23 12 90 28.0 36.5 7.0 137.2 24.4 34.9 7.0 153.5 32.3 43.8 7.0 177.6 37.0 49.6 7.5 205.9 CY2011 CY2012E CY2013E CY2014E

May 2013

15

Market Strategy

Indoco Remedies
Investment arguments
Focus on domestic formulation- Aiming for higher than industry growth: Indoco has a strong brand portfolio of 135 products and a base of ~2,200MRs. The company operates in various therapeutic segments, including anti-infective, anti-diabetic, CVS, ophthalmic, dental care, pain management and respiratory.Prominent Indoco brands include Cyclopam, Vepan, Febrex Plus, ATM, Sensodent-K and Sensoform. The company has seen strong growth across the respiratory, anti-infective, ophthalmic and alimentary therapeutic segments. Further, the company is investing to enhance its share of the chronic segment, which constitutes 10% of the overall sales. During 3QFY2013, the company recruited 254 MRs for its chronic segment, taking the total MRs in the chronic segment to around 400. Post the restructuring of the domestic business in FY2009, which has resulted in an improvement in the working capital cycle, Indoco is back on the growth trajectory with its domestic formulation business growing at a healthy pace of 16.2% during 9MFY2013, V/s 11.7% CAGR during FY2009-12.Going forward, the Management expects the domestic formulation business to outperform the industry. We expect the domestic formulation segment to grow at 15% CAGR during FY2012-15. Scaling -up on the export front: Indoco has also started focusing Scaling-up on regulated markets by entering into long-term supply contracts. The company is currently executing several contract-manufacturing projects, covering a number of products for its clients in the UK, Germany and Slovenia. The company has incurred a capex of `55cr for construction of the API facility in Patalganga and is expecting USFDA approval. We belive that the same will enhance its exports growth and expect the exports segment to grow at 27.1% CAGR during FY2012-15. Partnering with Pharmaceutical majors: The Company has a large customer base of small and medium sized generic companies across the globe and has major tie-ups with generic
(`)

Price - `64 Target Price - `89
products, extending to 30 countries of the Emerging Markets, while the contract signed with DSM, Austria, is for marketing eight of Indoco's Active Pharmaceutical Ingredient in various geographies. These deals have further strengthened Indoco's image in the international arena. Trial batches of two sterile ophthalmic products to Watson have already started in 2QFY2013, and commercial supplies are expected to start from 1QFY2014, followed by product approval from USFDA. Supplies to Aspen began in 4QFY2012 and would scale up gradually. Exports gaining share in the sales mix
80 71 70 60 50 40 30 20 10 0 FY2009 FY2010 FY2011 FY2012 FY2013E FY2014E FY2015E 29 30 33 36 36 40 70 67 64 64 60 56 44

Source: Company, Angel Research

Financials to improve, aiding stock outperformance: With these growth drivers in place, we belive that the company's growth is likely to accelerate. The top line is expected to register a CAGR of 18.1% during FY2012-15E, mainly driven by the exports. This will aid a robust net profit growth for the company 21.2% CAGR in the net profit during the period, inspite of accounting for just a 100bps expansion in the OPM. Thus, overall the profitability of the company is set to improve, with ROE and ROCE to reach 15.8% and 15.2% in FY2015E V/s 12.6% and 13.0% in FY2012 respectively. Thus, at CMP the stock is trading at 8.3x and 6.7x FY2014E and FY2015E earnings respectively. We recommend Buy on the stock with a revised target price of `89. PE band
90 80 70 60 50 40 30 20 10 0

companies for certain territories and products. The deal with Watson Pharmaceuticals, Inc. (Watson) is to develop and manufacture a number of sterile (ophthalmic) products for marketing in USA. The agreement with South Africa's largest pharmaceutical company, Aspen Pharmacare Limited (Aspen) encompasses a number of solid dosages and ophthalmic

Source: Company, Angel Research

December 2010

Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13

16

Market Strategy
Profit & Loss Statement (Consolidated)
Y/E March (` cr) Total operating income % chg Total expenditure EBITD A EBITDA (% of Net Sales) Depreciation& amortisation EBIT Interest & other charges Other income PBT (reported) Tax (% of PBT) PAT after MI (reported) ADJ .P AT ADJ. PA % chg FY2012 571 17.4 484 85 14.9 19 65 16 51 5 9.6 46 46 (9.2) FY2013 FY2014E FY2015E 640 12.1 542 90 14.2 21 69 18 2 60 9 15.0 51 51 10.5 782 22.2 656 118 15.2 26 92 18 2 83 17 20.0 67 67 30.0 945 20.9 795 143 15.2 31 111 18 2 103 21 20.0 82 82 23.9

Balance Sheet (Consolidated)
Y/E March (` cr) SOURCES OF FUNDS Equity share capital Reserves & surplus Shareholders funds Total loans Deferred tax liability T otal liabilities Total APPLICA TION OF FUNDS APPLICATION Gross block Less: acc. depreciation Net block Capital work-in-progress Investments 404 102 302 33 0 473 123 349 33 0 62 305 156 149 593 533 150 383 33 0 76 397 191 206 698 593 181 411 33 0 92 463 231 231 769 12 372 385 128 29 542 18 412 430 134 29 593 18 466 485 184 29 698 18 537 555 184 29 769 FY2012 FY2013 FY2014E FY2015E

Long Term Loans And Advances 55 Current assets Current liabilities Net current assets T otal Assets Total 267 114 152 542

Cash Flow Statement (Consolidated)
Y/E March (` cr) Profit before tax Depreciation (Inc)/Dec in working capital Direct taxes paid Cash Flow from Operations (Inc.)/Dec.in fixed assets (Inc.)/Dec. in investments Cash Flow from Investing Issue of equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Others Cash Flow from F inancing Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances FY2012 51 19 (41) 1 28 (84) 0 (84) 40 (12) 14 42 (14) 27 10 FY2013 FY2014E FY2015E 60 21 16 9 87 (69) (67) 6 (12) (1) (7) 13 10 23 83 26 (60) 17 31 (60) (58) 50 (12) (14) 24 (3) 23 20 103 31 (39) 21 73 (60) (58) (12) (17) (29) (14) 20 6

Key Ratios
Y/E March Valuation Ratio (x) P/E (on FDEPS) P/BV EV/Sales EV/EBITDA P er Share Data (`) Per EPS (fully diluted) DPS Book Value Returns (%) ROCE (Pre-tax) Angel ROIC (Pre-tax) ROE T urnover ratios (x) Turnover Inventory / Sales (days) Receivables (days) Payables (days) 56 71 47 57 73 49 61 78 50 59 75 50 13.0 14.8 12.6 12.1 13.2 12.6 14.2 15.5 14.5 15.2 16.2 15.8 5.0 0.1 41.8 5.6 0.1 46.7 7.2 0.1 52.6 8.9 0.1 60.3 12.0 1.4 1.2 7.9 10.8 1.3 1.1 7.4 8.3 1.1 0.9 6.1 6.7 1.0 0.8 5.1 FY2012 FY2013 FY2014E FY2015E

V

P

P

E

E

E

D

B

R

A

R

I

R

P

May 2013

17

Market Strategy

ITNL
Largest portfolio in the BO T segment: IL&FS Transportation BOT Networks (ITNL) is a surface transport player, with an established track record of successfully bidding, developing and operating road BOT projects on a commercial basis. ITNL is the largest in the road BOT segment (in terms of both - number of projects and lane kms), with portfolio comprising of 25 projects spanning over ~13,000 lane kms. We believe ITNL, being a market leader, is well poised to leverage on the growing opportunities in the BOT space, owing to 1) strong parentage (belongs to the IL&FS Group); 2) experienced Management at the helm of affairs (rich experience of over 22 years in the infrastructure business); and 3) unique business model (present across the value chain). Largest BOT portfolio
(Lane kms) 14,000
12,000 10,000 8,000 6,000 4,000 2,000 0 FY2011 FY2012 FY2013 Ashoka FY2014E IRB FY2015E ITNL FY2016E FY2017E 4,350 4,502 6,357 9,316 9,316 9,354 12,806

Price - `174 Target Price - `230
saw its operational portfolio increase at a CAGR of 17% to 6,357 lane kms. Going forward, we believe with the commissioning of under construction projects (including recently bagged BOT projects), ITNL's portfolio size would increase to 12,806 lane kms by FY2017, indicating a CAGR of 19% over FY2013-17. Equity investment of ~`2,415cr over next 3-4 years: The company has already invested ~ ` 3,260cr in its under-development BOT portfolio till 4QFY2013 and would require an incremental equity investment of ~`2,415cr over the next three to four years. We believe it would be able to fund its equity requirements through internal accruals from operational projects and construction business. Any shortfall would be met through securitisation of existing assets and leveraging the balance sheet. Outlook & valuation: ITNL's outstanding order book currently stands at `14,662cr (2.2x trailing revenues), which lends decent revenue visibility over the next few years. The stock trades at FY2015 PE and PB of 5.4x and 0.7x respectively. On the back healthy order book, we estimate the company to report earnings CAGR of 9.4% over FY2013-15 and a RoE of 14.2% in FY2015. We have used SOTP valuation method to arrive at a target price for ITNL. We value the construction business at a P/E of 5x FY2014E earnings, and the BOT projects on a DCF basis at a CoE of 14%. Also, we have valued the international business, Elsamex, and three surface transport projects (other than road projects) using P/BV multiple. We recommend Buy rating with a SO TP -based target price of `230, indicating an upside of 32%. SOTP TP-based One year forward P/BV band
500 450 400 350 300 250 200 150 100 50 0

Source: Company, Angel Research

Operational portfolio to cloak a CA GR of 19% over CAGR FY2013-17: Out of the total portfolio, the company has 14 projects which are under various stages of construction. Of these under development projects, 82% of total under construction projects aggregating to ~6,500 lane kms are BOT toll projects, while remaining 18% aggregating to ~1,300 lane kms are BOT annuity projects. Over the past three years, owing to commissioning of BOT projects such as Thiruvananthapuram road phase-II, Hazaribagh Ranchi Expressway, Jharkhand road phase - I, Hyderabad Ring Road and many others, the company Projects under development to be operational over FY2014-17
(Lane kms) 14,000 12,000 10,000 8,000 6,357 6,000 4,000 2,000 0 FY13 (total) FY14 FY15 FY16 FY17 FY17 (total) 2,958 1 38 3,452 12,806

4-Dec-10

4-Dec-11

4-Feb-11

4-Jun-10

4-Dec-12

4-Feb-12

4-Jun-11

4-Aug-10

4-Aug-11

4-Aug-12

4-Oct-11

4-Apr-12

4-Oct-12

4-Feb-13

4-Apr-10

4-Oct-10

4-Apr-11

4-Jun-12

0.5x

1.0x

1.5x

2.0x

Source: Company, Angel Research

Source: Company, Angel Research

December 2010

4-Apr-13

18

Market Strategy
Profit & Loss Statement (Consolidated)
Y/E March (` cr) Total operating income % chg Total Expenditure EBITD A EBITDA (% of Net Sales) Depreciation & Amortisation EBIT Interest & other Charges Other Income Recurring PBT PBT (reported) Tax (% of PBT) PAT (reported) Add: Share of earnings of asso. Less: Minority interest (MI) PAT after MI (reported) Fully Diluted EPS (`) FY2012 5,606 38.5 4,140 1,466 26.1 77 1,389 728 124 785 785 246 31.3 539 4 46 497 25.6 FY2013 FY2014E FY2015E 6,645 18.5 4,804 1,840 27.7 94 1,746 1,119 141 768 768 227 29.6 541 5 25 520 26.8 7,444 12.0 5,404 2,040 27.4 129 1,911 1,253 170 828 828 259 31.3 569 (1) (12) 580 29.8 8,041 8.0 5,717 2,324 28.9 150 2,174 1,393 204 984 984 308 31.3 676 (20) 33 623 32.1

Balance Sheet (Consolidated)
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves & Surplus Minority Interest Total Loans Deferred Tax Liability T otal Liabilities Total Application of funds Gross Block Less: Acc. Depreciation Net Block Capital Work-in-Progress Goodwill Receivables under SCA Investments Current Assets Current liabilities Net Current Assets T otal Assets Total 7,036 478 6,558 34 527 4,679 395 3,055 1,767 1,288 13,481 10,387 573 9,814 34 523 6,593 687 2,929 1,991 937 18,588 11,372 701 10,670 34 523 8,091 687 3,245 2,475 770 20,775 13,243 851 12,392 34 523 8,745 687 3,491 2,767 724 23,106 194 2,570 258 10,219 204 13,481 194 3,411 358 14,359 231 18,588 194 3,898 358 16,059 231 20,775 194 4,428 358 17,859 231 23,106 FY2012 FY2013 FY2014E FY2015E

Cash Flow Statement (Consolidated)
Y/E March (` cr) Profit before tax Depreciation Change in Working Capital Less: Other income Direct taxes paid FY2012 785 114 348 (124) (246) FY2013 FY2014E FY2015E 768 94 522 (141) (227) 1,016 (3,351) (292) 141 (3,501) 0 4,140 (91) (1,574) 2,656 171 284 455 828 129 182 (170) (259) 710 (985) 170 (815) 1,700 (91) (1,670) 120 14 455 470 984 150 12 (204) (308) 635 (1,872) 204 (1,668) 1,800 (91) (891) 1,000 (34) 470 436

Key Ratios
Y/E March V aluation Ratio (x) Valuation P/E (on FDEPS) P/BV EV/Sales EV/EBITDA P er Share Data (`) Per EPS (fully diluted) Cash EPS DPS Book Value Returns (%) ROCE (Pre-tax) Angel ROIC (Pre-tax) ROE T urnover ratios (x) Turnover Asset Turnover (Gross Block) Inventory / Sales (days) Receivables (days) Payables (days) Wcap cycle (ex-cash) (days) 1.1 2 54 121 178 0.8 1 46 125 144 0.7 1 38 134 129 0.7 1 39 152 132 12.9 14.0 19.6 10.9 11.6 16.2 9.7 10.2 14.9 9.9 10.4 14.2 25.6 29.5 4.0 144.1 26.8 31.6 4.0 187.4 29.8 36.5 4.0 212.4 32.1 39.8 4.0 239.7 6.8 1.2 2.4 9.1 6.5 0.9 2.6 9.4 5.8 0.8 2.5 9.3 5.4 0.7 2.6 9.0 FY2012 FY2013 FY2014E FY2015E

Cash Flow from Operations 877 (Inc.)/ Dec. in Fixed Assets (3,535) (Inc.)/ Dec. in Investments Other income (201) 124

Cash Flow from Investing (3,612) Issue of Equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Others 4,752 (91) (2,352)

Cash Flow from F inancing 2,491 Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances (244) 528 284

May 2013

19

Market Strategy

Mahindra Lifespaces
In the right markets: Mahindra Lifespaces Developers (MLIFE) is ITNL a mid and premium housing developer catering to strong demand in tier-1 cities and small metros in the country. Apart from real estate development, MLIFE also operates two integrated business cities - Mahindra World City (MWC) Chennai and Jaipur [special economic zones (SEZ) and domestic tariff area (DTA)]. With slowing demand in super metros (Mumbai and NCR), we favor MLIFE's exposure to tier-1 cities (Pune and Nagpur) and small metros (Hyderabad), given their strong demand dynamics. Pune, Nagpur and Hyderabad now form 60% of MLIFE's exposure in terms of saleable area. With 5.4mn sq. ft. of forthcoming projects (~4.7x its FY2013 sales), we expect strong sales momentum during FY2014 and FY2015, as a primary catalyst. We also note that with the initiation of the rate cut cycle, mid-market housing will lead the recovery in demand, which has been a focus area for MLIFE. City wise project exposure- Forthcoming and Ongoing projects
11% 16% 36%

Price - `397 Target Price - `476
sq ft in Chennai through its subsidiaries- (MITL & MRDL). Out of this ~19.2% of total land bank aggregating to 4.41mn sqft are ongoing projects. Going forward, we expect strong sales numbers along with improving realizations in the coming quarters on the back of sharp pick up in approvals and new launches anticipated in the current financial year. On back of 5.4mn sqft of forthcoming projects, we estimate sales volumes to pick up from 1.2mn sqft in FY2012 to 1.9mn sqft in FY2015E respectively. Strong balance sheet; comfortably leverage: MLIFE’s net debt-equity stand at 0.35x and 0.75x in FY2013 on a standalone and consolidated basis respectively which is better than its peers. We believe MLIFE is well placed in the real estate space owing to strong residential portfolio, well positioned SEZ, strong parental advantage and better financial position. Outlook & V aluations: We remain positive on MLIFE given its Valuations: diversified geographic exposure in terms of ongoing and forthcoming real estate projects. We expect strong sales numbers over the coming quarters, following new project launches in Pune, Chennai and Mumbai, along with robust execution. The stock is currently trading at 1.1x and 1.0x on our FY2014E and FY2015E book value compared to its 3 year average of 1.3x. We value MLIFE on a SOTP basis and slightly adjust our NAV to

10% 17%
Chennai Mumbai Pune NCR Nagpur

10%
Hyderabad

`528/share, and apply a 10% discount to our SOTP value to arrive at a target price of `476, suggesting an 20% upside from the current levels. We recommend a Buy rating on the stock. One year forward P/BV band
2.5 2.0

Source: Company, Angel Research

New launches to help pick up in sales: As on 4QFY2013, MLDL holds a total land bank of 22.94mn sq ft which includes 14.79mn MLIFE's forthcoming projects breakdown City Mumbai Mumbai Pune Pune Hyderabad Chennai Chennai Chennai Chennai Nagpur Total
Source: Company, Angel Research; Note: *Joint Development

Forthcoming P rojects Projects Andheri Alibaug Antheia -subsequent phases SopanBaug* Ashvita -subsequent phases * Aqualily -subsequent phases New project at MWCC Iris Court Phase III B Avadi(Affordable Housing) Bloomdale subsequent phases

Area (mn sqft) 0.37 0.23 1.38 0.09 0.65 0.2 0.54 0.13 0.72 1.12 5.41

1.5 1.0 0.5 0.0
Sep-12 Nov-12 Jan-12 Jan-13 Nov-11 Nov-10 Mar-11 Mar-12 Mar-13 Sep-10 Sep-11 Jan-11 May-10 May-11 May-12 May-13 Jul-10 Jul-11 Jul-12

P/B (x)

Avg P/B (3 yr)

Source: Company, Angel Research

December 2010

20

Market Strategy
Profit & Loss Statement (Consolidated)
Y/E March (` cr) Operating income % chg Total Expenditure EBITD A EBITDA (% of Net Sales) Depreciation& Amortisation EBIT Interest & other charges Other Income (% of sales) PBT Tax (% of PBT) PAT (reported) Minority Interest ADJ .P AT ADJ. PA Fully Diluted EPS (`) FY2012 701 14.6 510 191 27.3 9 182 21 27 3.0 188 59.3 31.5 129 10 119 29.2 FY2013 FY2014E FY2015E 738 5.3 496 242 32.8 9 233 31 34 4.2 236 79.9 33.9 156 15 141 34.6 888 20.3 616 272 30.6 8 264 40 41 4.5 265 89.7 33.9 175 17 159 38.8 1,002 12.8 695 307 30.6 8 299 49 46 4.9 296 100.3 33.9 196 19 177 43.4

Balance Sheet (Consolidated)
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders F unds Funds Minority Interest Total Loans Others Total Liabilities Application of funds Gross Block Less: Acc. Depreciation Net Block Goodwill Capital Work-in-Progress Investments Current Assets Current liabilities Net Current Assets Total Assets 230 37 195 29 8 175 1,852 473 1,379 1,786 245 45 209 95 7 133 2,414 652 1,762 2,206 265 53 213 95 7 133 2,662 752 1,910 2,358 285 61 224 95 7 133 3,002 934 2,068 2,528 41 1,114 1,155 100 505 26 1,786 41 1,252 1,293 86 778 49 2,206 41 1,377 1,418 102 788 49 2,358 41 1,517 1,559 121 799 49 2,528 FY2012 FY2013 FY2014E FY2015E

Cash Flow Statement (Consolidated)
Y/E March (` cr) Profit before tax Depreciation Change in Working Capital Other income Direct taxes paid Cash Flow from Operations (Inc.)/Dec. in Fixed Assets (Inc.)/Dec. in Investments Other income Cash Flow from Investing Issue of Equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Others Cash Flow from F inancing Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances FY2012 188 6 (93) (27) (59) 14 (14) (87) 27 (74) (13) (24) 9 (27) (88) 238 150 FY2013 FY2014E FY2015E 236 7 (388) (34) (80) (259) (21) 42 34 55 273 (30) (45) 198 (6) 150 144 265 8 (145) (41) (90) (3) (12) 41 30 10 (33) (23) 3 144 147 296 8 (144) (46) (100) 14 (20) 46 26 11 (37) (26) 14 147 161

Key Ratios
Y/E March Valuation Ratio (x) P/E (on FDEPS) P/BV EV/Sales EV/EBITDA Per Share Data (`) EPS (fully diluted) DPS Book Value Returns (%) ROCE (Pre-tax) Angel ROIC (Pre-tax) ROE Turnover ratios (x) Asset Turnover Inventory / Sales (days) Receivables (days) Payables (days) WC cycle (ex-cash) (days) 0.5 517 97 288 615 0.4 662 71 414 704 0.4 693 41 416 695 0.5 675 42 443 669 10.5 11.8 10.3 11.7 12.6 10.9 11.6 12.4 11.2 12.2 13.1 11.4 29.2 (5.8) 282.8 34.6 (7.2) 316.7 38.8 (8.1) 347.4 43.4 (9.1) 381.7 13.6 1.4 2.8 10.3 11.4 1.3 3.1 9.3 10.2 1.1 2.5 8.3 9.1 1.0 2.3 7.4 FY2012 FY2013 FY2014E FY2015E

May 2013

21

Market Strategy

Relaxo Footwear
Store expansion and brand revamp to drive volume
As a part of aggressive retail expansion strategy, Relaxo has added 27 retail outlets in FY2013 taking the total outlet count to 168. Additionally, Relaxo has leading celebrities to endorse its brands. Salman Khan endorses Hawaii, Katrina Kaif endorses Flite and Akshay Kumar endorses Sparx. The expansion of retail outlets along with the leading celebrity endorsing the brands will help the company in expanding its reach as well as strengthening its brand image which will eventually result in top-line addition.
( ` cr)

Price - `620 Target Price - `791
Outlook and valuation
Driven by the volume growth of 13.0% in FY2015E coupled with price hike, we expect Relaxo to post a revenue CAGR of 15.2% over FY2013-15E to `1,333cr with an operating margin of 11.4% in FY2015E. Revenue to be driven by volume growth
1,600 1,400 1,200 1,000 800 600 16.8 14.1 20.0 16.3 23.9 25.4 30.0 33.3 35.9 40.0

Capacity expansion in place to cater to the increasing demand
The current Indian footwear market is estimated at US$3.9bn and is growing at a CAGR of 15% and thus is expected to be worth US$6.9bn by FY2015. We expect that with the current capacity of 4lakh pairs per day, the company will be able to cater to the growing demand. Also, the per capita shoe consumption in India is only 2.5 shoes (FY2012 data), which is much below the average per capita shoe consumption (of five) in developed countries. This provides Relaxo a huge opportunity.

200 0

407

554

686

860

1,005

1,146

1,333

400

10.0

0.0

Revenue (LHS)

Revenue growth (RHS)

Source: Company, Angel Research

The PAT is expected to grow at a CAGR of 27.7% to `73cr for the same period. With the growth triggers in place, which includes - 1) capacity expansion plan, 2) store expansion, 3) improved sales mix, 4) brand revamping and 5) continuous product development - we remain positive on the company's future. We maintain our Buy recommendation on the stock with a revised target price of `791, based on a target PE of 13x for FY2015E . FY2015E. One-Year Forward P/E Chart
250 200 150

Changing revenue mix to drive profit
Sparx has increased its contribution from a mere 4.2% in FY2008 to 26% in FY2012; on the other hand, Flite has maintained its contribution at ~25-30%. Hawaii, being a mass brand, adds to the volume; however, Sparx and Flite, which are high margin brands, will help in improving the company's profitability. Going forward we expect the mix to further improve. To meet the growing demand and growing fashion-consciousness of the consumers, the company is launching new designs across all brands in regular intervals which will help the company to maintain its competitiveness. Improving product mix
100.0 14.7 80.0 60.0
(%)

(`)

100 50 0

Dec-10

FY2013E

FY2014E

FY2015E

FY2009

FY2010

FY2011

FY2012

May-11

Mar-12

Aug-12

Apr-09

Feb-10

Sep-09

Price (`)

10x

15x

Oct-11

20x

25x

Source: Company, Angel Research
18.9 7.5 31.9 29.1 28.9 25.8 26.0 15.1 15.3 14.5 24.3 15.0 26.0 4.2

40.0 20.0 0.0 FY2008 FY2009 FY2010 FY2011 49.2 44.4 40.8

35.5

33.0

FY2012

Hawaii

Flite

Sparx

Others*

Source: Company, Angel Research

December 2010

Jan-13

Jul-10

22

(%)

Market Strategy
Profit & Loss Statement
Y/E March (` cr) Total operating income % chg Total Expenditure Net Raw Materials Personnel Other EBITD A EBITDA (% of Net Sales) Depreciation& Amortisation EBIT Interest Other Income (% of Net Sales) Recurring PBT Extraordinary Expense/(Inc.) PBT (reported) Tax PAT (reported) ADJ .P AT ADJ. PA FY2012 860 25.4 770 459 82 229 90 10.5 23 67 19 5 0.6 48 0.0 54 14 40 40 FY2013 FY2014E FY2015E 1,005 16.8 900 469 113 317 105 10.4 25 79 18 6 0.6 62 0.0 68 23 45 45 1,146 14.1 1,021 544 129 348 125 10.9 29 96 19 6 0.6 77 0.0 83 28 55 55 1,333 16.3 1,182 623 150 408 152 11.4 32 120 17 7 0.6 103 0.0 110 37 73 73

Balance Sheet
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders’ F unds Funds Total Loans Other Long Term Liabilities Long Term Provisions Deferred Tax Liability (Net) Total Liabilities APPLICA TION OF FUNDS APPLICATION Gross Block Less: Acc. Depreciation Net Block Capital Work-in-Progress Investments 379 108 272 21 0 464 133 330 20 0 15 1 240 154 87 452 510 162 348 20 0 15 1 284 176 108 491 561 193 367 20 0 15 1 336 204 132 535 6 166 172 146 0 3 22 344 6 208 214 205 6 3 24 452 6 257 263 195 6 3 24 491 6 325 331 171 6 3 24 535 FY2012 FY2013 FY2014E FY2015E

Long Term Loans and advances 12 Other Non-current asset Current Assets Current liabilities Net Current Assets Total Assets 1 169 131 38 344

Cash Flow Statement
Y/E March (` cr) Profit before tax Depreciation Change in Working Capital Direct taxes paid Others Cash Flow from Operations (Inc.)/Dec. in Fixed Assets (Inc.)/Dec. in Investments (Incr)/Decr In LT loans & adv. Others Cash Flow from Investing Issue of Equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Others Cash Flow from F inancing Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances FY2012 54 23 (4) (14) 14 73 (46) 0 1 (2) (47) 0 (11) (2) (14) (27) (1) 2 1 FY2013 FY2014E FY2015E 68 25 (46) (23) (6) 18 (83) 0 3 11 (69) 0 59 (6) 0 53 2 1 3 83 29 (16) (28) (6) 62 (46) 0 0 7 (40) 0 (10) (6) 0 (17) 6 3 9 110 32 (25) (37) (7) 73 (51) 0 0 8 (43) 0 (23) (6) 0 (30) (0) 9 8

Key Ratios
Y/E March Per Share Data (`) EPS (Basic) Cash EPS DPS Book Value Operating ratio Inventory / Net sales (days) Receivables (days) Payables (days) Returns (%) ROE ROCE (Pre-tax) Angel ROIC (Pre-tax) Valuation Ratio (x) P/E (on FDEPS) P/CEPS P/BV EV/Net sales EV/EBITDA 18.6 11.8 4.3 1.0 9.9 16.6 10.6 3.5 0.9 9.0 13.5 8.9 2.8 0.8 7.4 10.2 7.1 2.3 0.7 6.0 26.0 19.5 20.8 23.2 17.6 18.5 23.0 19.6 20.8 24.6 22.5 23.7 52 10 60 52 11 58 56 11 63 58 12 63 33.3 52.5 1.5 143.7 37.3 58.6 5.0 178.7 45.9 69.8 5.0 219.6 60.9 87.2 5.0 275.4 FY2012 FY2013 FY2014E FY2015E

May 2013

23

Market Strategy

Tech Mahindra
Tech Mahindra and Mahindra Satyam - merger of two companies with minimal overlap
Tech Mahindra and Satyam are set to merge, approval pending in the Andhra Pradesh High Court, which would take the proposed merged entity to be the fifth largest amongst the Indian offshore service providers. The management of both the companies intends to create a single go-to-market strategy with benefits of scale and enhanced depth and breadth of capabilities, translating into increased business opportunities and reduced expenses. We believe the proposed merger would benefit both the companies based on the following potential synergies: Well diversified industry wise revenue mix along with limited client concentration risks: The combined entity will have a broader service offering. As of now, Tech Mahindra's entire revenue comes from the telecom vertical, which has been shrinking over the past couple of years. After the merger, contribution from telecom would come down to sub-50% (47-48%). The combined entity will have a broad based play across industries such as manufacturing, BFSI, telecom, technology, media and entertainment (TME), retail, transport and logistics and lifesciences and healthcare. In addition, we believe market concerns over Tech Mahindra's high dependency on BT posing a risk to revenues could be mitigated significantly as BT's share of revenues would decline to ~15% (from 25% currently). Combined entity revenue mix - vertical wise
3% 5% 7%

Price - `952 Target Price - `1,170
Big -ticket deals: The merger will result in the creation of a new Big-ticket offshore services leader with revenues of ~US$2.5bn in revenues, approximately 80,000+ strong work force and 350+ active clients (including Fortune Global 500 companies), across 54 countries. This will enable Tech Mahindra to compete with biggies of the industry and vie for larger deals, which could lead to improved traction for the merged entity, acting as a catalyst for topline growth.

Recent acquisitions by Tech Mahindra to provide incremental growth and capabilities
Tech Mahindra has done two acquisitions in 2012 - Comviva (a value added service provider - US$70mn annual revenue) and Hutchison Global Services (a BPO provide - US$160mn annual revenue), in order to boost its growth and fill in the missing gaps, particularly in the BPO and VAS verticals, in its telecom services portfolio. These acquisitions also provided an increased penetration into some of the largest telcos globally such as Bharti Airtel in Africa and Vodafone, Hutch in Asia and Europe.

Outlook and Valuation
The Management indicated that the company remains confident of growth from the non-BT business with it continuing to see a robust deal pipeline across geographies. We believe the increased traction in non-BT accounts and consolidation of HGS and Comviva will offset the decline in BT and will drive growth going forward. From Tech Mahindra per se, we expect the non-BT business to post a CAGR of 17% over FY2013-15E with BT business being stable. We expect revenue CAGR of 11% over FY2013-15E for Tech Mahindra. For Satyam, we expect USD revenue CAGR of 9.2% over FY2013-15E. The combined entity's revenue CAGR is expected to be at 10.6% over FY2013-15E. PAT of Tech Mahindra and Satyam for FY2015 are expected to be at `994cr and `1,342cr respectively. Taking the new share count of 23.08cr shares (post merger of Tech Mahindra and Mahindra Satyam) into account, the consolidated EPS comes in ech Mahindra at 11.5x FY2015E EPS of at `101.3. We value T Tech `101.3 and maintain Buy rating on the stock with a target price of `1,170.

Telecom Manufacturing TME

11%

47%

BFSI
10%

Retail,T & L Healthcare and life sciences
17%

Others

Source: Company, Angel Research

Diversified portfolio of services: Tech Mahindra possesses expertise in mobility, system integration, and delivery of large transformational deals, while Mahindra Satyam's Enterprise services experties will get added to Tech Mahindra's portfolio of services. Thus, we believe the proposed merged entity would be well-equipped to offer a wide range of services to clients across multiple verticals.

December 2010

24

Market Strategy
Profit & Loss Statement (Consolidated)
Y/E March (` cr) Net sales Cost of revenues Gross profit % of net sales SG&A expenses EBITD A EBITDA % of net sales Dep. and amortization % of net sales EBIT Interest expense Other income Profit before tax Provision for tax PAT Share from associates Exceptional item AT Reported P PA Adjusted P AT PA FY2012 5,490 3,678 1,811 33.0 892 919 16.7 161 2.9 758 103 98 753 144 610 557 (68) 1,095 1,117 FY2013 FY2014E FY2015E 6,873 4,339 2,535 36.9 1,110 1,424 20.7 200 2.9 1,224 103 (75) 1,047 236 811 497 69 1,288 1,357 7,779 5,000 2,778 35.7 1,245 1,534 19.7 233 3.0 1,300 84 91 1,307 366 941 528 1,429 1,429 8,398 5,432 2,966 35.3 1,344 1,622 19.3 252 3.0 1,370 48 115 1,436 402 1,034 573 1,567 1,567

Balance Sheet (Consolidated)
Y/E March (` cr) Equity capital Profit and loss Other reserves Net worth Total debt Other long term liability Long-term provisions Total capital employed Net block Capital WIP Investments Deferred tax asset, net Sundry debtors Cash and cash equivalents Loans and advances Sundry creditors Other liabilities Provision Total capital deployed FY2012 128 2,998 655 4,051 1,127 430 189 5,796 683 167 3,427 100 1,317 242 645 (365) (608) (151) 5,796 FY2013 FY2014E FY2015E 128 4,372 655 5,426 1,080 226 206 7,047 938 341 4,099 151 1,704 536 666 (640) (992) (317) 7,047 128 5,701 655 6,754 936 256 206 8,221 1,005 341 4,599 151 1,705 948 778 (565) (951) (350) 8,221 128 7,186 655 8,239 786 286 206 9,576 1,053 341 5,099 151 1,841 1,582 840 (613) (900) (378) 9,576

Note: Numbers exclude Mahindra Satyam financials

Note: Numbers exclude Mahindra Satyam financials

Cash Flow Statement (Consolidated)
Y/E March (` cr) FY2012 FY2013 FY2014E FY2015E 1,121 200 497 (94) (236) 407 1,895 (630) (672) (245) (1,546) (46) (204) 1 177 (55) 294 242 536 1,216 233 528 51 (366) (196) 1,467 (300) (500) (800) (144) 30 (255) 412 536 948 1,322 252 573 105 (402) (173) 1,676 (300) (500) (800) (150) 30 (242) 634 948 1582 Pre tax profit from operations 655 Depreciation Expenses (deffered)/WO Other income Tax Net trade working capital 161 557 95 (144) (44)

Key Ratios
Y/E March Valuation ratio (x) P/E P/BVPS EV/Sales EV/EBITDA EV/Total assets Per share data (`) EPS Cash EPS Dividend Book value Return ratios (%) RoCE (pre-tax) Angel RoIC RoE Turnover ratios (x) Asset turnover (fixed assets) Receivables days Payable days 6.5 78 24 5.4 80 34 5.8 80 33 6.0 80 33 13.1 14.1 27.6 17.4 19.8 25.0 15.8 18.8 21.2 14.3 17.9 19.0 84.6 95.3 4.0 307.2 96.7 111.8 5.0 407.8 107.4 125.0 5.0 507.7 117.8 136.7 5.0 619.3 11.2 3.1 2.4 14.5 15.7 9.8 2.3 1.9 9.1 10.1 8.9 1.9 1.6 8.1 9.2 8.1 1.5 1.4 7.2 8.3 FY2012 FY2013 FY2014E FY2015E

Cashflow from operations 1,280 (Inc)/dec in fixed assets (Inc)/dec in investments (Inc)/dec in other non CA Cashflow from investing Inc/(dec) in debt Inc/(dec) in deferred rev. Inc/(dec) in equity/premium Add. to resv. on amalgmn. Cashflow from financing Cash generated/(utilised) Cash at start of the year Cash at end of the year (333) (557) 83 (807) (56) 38 12 (394) (498) (25) 267 242

May 2013

25

Market Strategy

United Phosphorus
Investment arguments
Agrichemical - A highly consolidated industry, generic companies in sweet spot The global agrichem industry, valued at ~US$45bn (CY2012E), is dominated by the top six innovators, viz Bayer, Syngenta, Monsanto, BASF, DuPont and Dow. These top five companies enjoy a large market share of the patented (28%) and off-patent (32%) market and in generic, they occupy 61% of the share (of the 40% off-patent market). From overall market perspective, the top 11 players control 84% of the total agrichemical market. This is due to high entry by way of investments required for product registration and to set up manufacturing facilities. Thus, one-third of the total pie worth ~US$15bn, which is controlled by the top six innovators through proprietary off-patent products, provides a high-growth opportunity for larger integrated generic players such as UPL. Moreover, as we go forward, around US$7bn worth of the products would be going off-patent in the next 2-3 years, augmenting overall growth opportunity for generic players like UPL. Global agrichemical industry

Price - `155 Target Price - `232
A leading fast growing global generic play
Over last 10 years, UPL has evolved from being a small regional player focused on technical and generic formulations of crop protection, to global player focused on formulations and offering crop solutions (seeds, crop protection and adjacent technologies). It now enjoys leadership in 10 products globally. In UPL's evolution over the last 10 years, while acquisitions (28 in last 10 years) have played a key role and it has outgrown industry over last 5 years at ~21% CAGR (~16.8% CAGR in organic growth). UPL now has presence in all the key markets, ie presence in 70 countries and hence no major acquisition is expected to gain market access. Going forward, the company expects a) new product launches (company expects to participate in the 30% of the products going off patent), b) collaborations, c) penetrating emerging markets, d) crop diversification and e) adjacent technologies to maintain its growth momentum. Improving P rofitability + Attractive V aluations = Good V alue Buy: Profitability Valuations Value Over FY2013-15E, we expect UPL to post 12% and 14.2% CAGR in sales and PAT, respectively. For FY2014, the Management has given its guidance of a revenue growth of 12-15% and of OPM

Proprietary Off Patent (Top -6) 32%

Generic off patent 40%

Generic Top -5 61%

Generic Others 39%

(incl. other income) expanding by 100bp. However, as of now we have factored in a conservative estimates. On the capital efficiency front, the company's RoCE is expected to improve from 14.9% in FY2013 to 15.8% in FY2015E, respectively. At current valuations of 7.1x FY2015E EPS, the stock is attractively valued. At these levels, the stock is trading at its lower end of the valuation band over the last 8 years. Also in comparison to its Indian peers like Rallis, the stock trades at ~44% discount. Thus given its scale and growth opportunities, we believe that the stock is a attractive value pick in the space, thus maintain our Buy rating on the stock with a T arget P rice of `232. Target Price One-Year Forward P/E Chart
350 300 250
(`)

Proprietary Patent (Top -6) 28%

Source: Company, Angel Research

Generic segment's market share to increase
Generic players have been garnering a high market share, increasing from 32% levels in 1998 to 40% by 2006-end. The industry registered a CAGR of 3% over 1998-2006, while generic players outpaced the industry with a CAGR of 6%. Going ahead, given the opportunities and a drop in the rate of new molecule introduction by innovators, we expect generic players to continue to outpace the industry's growth and increase their market share in the overall pie. Historically, global agrichem players have been logging in-line growth with global GDP . Going ahead, over 2013-14, the global economy is expected to grow by 2-3%. Assuming this trend plays out in terms of growth for the agrichem industry and the same rate of genericisation occurs, the agrichemical generic industry could log in 6-8% yoy growth during the period and garner a market share of 44-45%.

200 150 100 50 0
01-Sep-04 01-Feb-05 01-Jul-05 01-Sep-09 01-Dec-05 01-Mar-07 01-May-06 01-Aug-07 01-Nov-08 01-Feb-10 01-Apr-04 01-Oct-06 01-Jan-08 01-Jun-08 01-Apr-09 01-Jul-10 01-Dec-10 01-Mar-12 01-Oct-11 01-May-11 01-Aug-12 01-Jan-13

Source: Company, Angel Research

December 2010

26

Market Strategy
Profit & Loss Statement (Consolidated)
Y/E March (` cr) Total operating income % chg Total Expenditure EBITD A EBITDA (% of Net Sales) Depreciation& Amortisation EBIT % chg Interest & other Charges Other Income Recurring PBT % chg Extraordinary Expense/(Inc.) PBT (reported) Tax (% of PBT) PAT after MI (reported) ADJ .P AT ADJ. PA % chg FY2012 7,655 31.9 6,288 1,246 16.5 292 1,075 19.9 415 109 769 13.3 18 751 128 17.0 556 561 1.6 FY2013 FY2014E FY2015E 9,195 20.1 7,556 1,454 16.1 354 1,285 19.5 429 100 956 24.3 12 944 203 21.5 775 786 40.0 10,114 10.0 8,595 1,703 16.5 378 1,510 17.5 568 100 1,041 8.9 1,041 208 20.0 860 860 9.4 11,125 10.0 9,439 1,870 16.5 399 1,656 9.7 568 100 1,188 14.0 1,188 238 20.0 979 979 13.8

Balance Sheet (Consolidated)
Y/E March (` cr) SOURCES OF FUNDS Equity Share Capital Reserves& Surplus Shareholders F unds Funds Total Loans Deferred Tax Liability T otal Liabilities Total APPLICA TION OF FUNDS APPLICATION Gross Block Less: Acc. Depreciation Net Block Capital Work-in-Progress Goodwill / Intangilbles Investments 4,687 2,605 2,082 306 1,141 795 5,244 2,959 2,284 306 1,277 1,025 269 7,162 3,084 4,078 9,239 5,544 3,337 2,207 306 1,277 1,025 354 7,876 3,061 4,815 9,983 5,844 3,735 2,108 306 1,277 1,025 388 9,102 3,362 5,740 10,844 92 4,081 4,423 3,596 (6) 8,014 89 4,557 4,879 4,373 (13) 9,239 89 5,301 5,623 4,373 (13) 9,983 89 6,164 6,484 4,373 (13) 10,844 FY2012 FY2013 FY2014E FY2015E

Long Term Loan & Advances 259 Current Assets Current liabilities Net Current Assets T otal Assets Total 5,671 2,240 3,432 8,014

Cash Flow Statement (Consolidated)
Y/E March (` cr) Profit before tax Depreciation FY2012 751 292 FY2013 FY2014E FY2015E 944 354 (664) (203) 431 (557) (231) (787) (777) (116) 1,231 339 (18) 1,566 1,548 1,041 378 (20) (208) 1,190 (300) (300) (116) (59) (174) 716 1,548 2,264 1,188 399 (250) (238) 1,098 (300) (300) (116) (8) (123) 675 2,264 2,939

Key Ratios
Y/E March V aluation Ratio (x) Valuation P/E (on FDEPS) P/BV EV/Sales EV/EBITDA Per Share Data (`) EPS (fully diluted) DPS Book Value Returns (%) ROCE (Pre-tax) Angel ROIC (Pre-tax) ROE T urnover ratios (x) Turnover Inventory / Sales (days) Receivables (days) Payables (days) 78 79 66 82 82 68 87 87 70 89 89 71 16.1 22.8 13.7 14.9 20.9 16.9 15.7 22.6 16.4 15.9 24.4 16.2 12.2 2.5 95.8 17.8 2.6 110.2 19.4 2.6 127.0 22.1 2.6 146.5 12.9 1.6 1.1 6.7 8.9 1.4 1.0 6.2 8.1 1.2 0.8 4.8 7.1 1.1 0.7 4.0 FY2012 FY2013 FY2014E FY2015E

Change in Working Capital (680) Direct taxes paid (128)

Cash Flow from Operations 235 (Inc.)/ Dec. in Fixed Assets (Inc.)/ Dec. in Investments Inc./ (Dec.) in loans and adv. Cash Flow from Investing Issue of Equity Inc./(Dec.) in loans Dividend Paid (Incl. Tax) Others (989) 29 -

(961) 2,026 (116) (319)

Cash Flow from F inancing 1,591 Financing Inc./(Dec.) in Cash Opening Cash balances Closing Cash balances 866 700 1,566

May 2013

27

Market Strategy

Stock Watch

May 2013

28

Stock W atch | May 2013 Watch
Company Name Reco CMP (`) 139 157 259 86 23 253 1,804 226 9,049 107 140 1,450 1,635 115 967 1,667 210 25 288 37 123 87 1,458 692 300 57 427 67 407 88 452 908 702 1,204 85 154 61 Target Price (`) 232 285 104 27 2,056 170 150 1,819 154 1,847 222 30 324 144 1,853 851 350 64 481 495 97 1,503 93 185 66 Mkt Cap (` cr) 2,693 6,964 4,421 4,330 6,159 382 52,189 5,253 28,414 365 11,930 2,410 32,643 474 59,393 50,366 12,322 150 77,134 1,760 6,173 4,891 68,336 29,168 17,847 3,760 18,907 7,020 6,227 3,068 7,721 140,415 167,061 138,914 11,349 6,610 5,623 Sales (` cr) FY14E FY15E 1,657 10,298 3,418 13,852 14,038 834 22,684 6,198 9,821 5,325 7,053 1,525 25,274 7,972 44,550 48,455 28,442 1,479 206,341 7,715 6,876 5,254 19,055 16,365 14,482 4,392 11,928 8,249 5,558 3,187 2,873 8,573 27,682 25,705 9,477 6,185 8,142 1,906 11,310 3,892 15,487 16,442 965 25,908 6,793 11,394 5,974 8,061 1,742 27,658 8,754 50,260 55,723 31,493 1,685 227,695 8,584 7,545 5,900 22,710 18,781 16,383 4,743 13,467 9,211 6,121 3,582 3,413 10,142 33,916 30,330 10,678 6,978 8,956 OPM (%) FY14E FY15E 14.1 16.5 14.5 11.4 7.6 9.3 18.0 14.6 17.0 8.4 14.2 14.5 14.1 7.1 11.4 11.2 7.5 10.0 12.8 6.0 2.6 2.8 3.3 2.2 2.3 3.1 2.1 2.4 2.0 2.3 3.0 3.6 4.6 3.1 2.0 3.0 2.5 14.1 16.5 14.5 11.5 8.7 10.6 18.5 14.9 17.2 8.3 14.5 15.7 13.7 7.0 11.7 10.9 7.8 9.9 13.5 6.1 2.5 2.8 3.2 2.3 2.3 3.0 2.2 2.4 2.0 2.4 3.1 3.6 4.5 3.2 2.1 3.0 2.5 EPS (`) FY14E FY15E 7.7 20.5 18.5 12.8 1.0 17.3 117.3 14.5 373.5 40.8 7.8 88.4 110.1 37.5 59.6 107.8 12.5 5.5 32.3 5.0 28.2 21.1 130.7 121.3 58.1 12.6 74.8 14.9 98.4 23.8 52.7 37.0 35.3 83.9 19.5 37.0 16.5 8.9 23.2 20.4 14.9 2.2 27.1 137.1 17.3 438.7 48.5 9.1 109.5 139.9 44.0 68.3 123.1 14.8 7.5 39.0 5.8 30.9 22.9 152.3 142.5 68.1 13.6 86.0 18.2 107.6 25.5 61.9 43.6 42.7 96.2 22.6 42.2 20.6 PER (x) FY14E FY15E 18.0 7.7 14.0 6.7 22.1 14.6 15.4 15.5 24.2 2.6 17.9 16.4 14.8 3.1 16.2 15.5 16.8 4.6 8.9 7.5 4.4 4.1 11.2 5.7 5.2 4.5 5.7 4.5 4.1 3.7 8.6 24.6 19.9 14.4 4.4 4.2 3.7 15.6 6.8 12.7 5.8 10.4 9.3 13.2 13.0 20.6 2.2 15.4 13.2 11.7 2.6 14.2 13.5 14.2 3.3 7.4 6.4 4.0 3.8 9.6 4.9 4.4 4.2 5.0 3.7 3.8 3.4 7.3 20.8 16.4 12.5 3.8 3.6 2.9 P/BV (x) FY14E FY15E 3.7 1.3 3.4 1.1 1.9 1.4 5.5 2.0 4.4 0.4 3.0 2.4 5.4 0.5 3.3 2.3 4.1 0.5 1.9 1.3 0.6 0.6 1.8 0.8 0.8 0.7 0.8 0.7 0.6 0.6 1.1 5.0 3.9 1.9 0.5 0.6 0.4 3.2 1.1 2.8 0.9 1.7 1.3 4.4 1.8 3.7 0.4 2.6 2.0 4.3 0.4 2.8 2.0 3.3 0.4 1.6 1.1 0.6 0.5 1.57 0.7 0.7 0.6 0.7 0.6 0.5 0.5 1.0 4.5 3.30 1.7 0.5 0.5 0.4 RoE (%) FY14E FY15E 22.2 18.0 26.6 17.5 6.2 9.5 39.9 13.6 18.0 17.3 18.1 15.5 39.8 16.4 22.3 16.2 27.5 11.1 23.1 18.1 12.8 13.3 17.2 15.1 14.4 16.8 13.7 12.5 14.8 15.9 13.4 30.0 21.3 15.2 12.8 14.8 11.8 21.9 17.4 23.8 17.3 12.5 14.0 37.2 14.7 17.9 17.6 18.2 16.5 40.7 16.6 21.6 16.0 25.8 13.7 23.2 18.5 12.7 13.0 17.6 15.7 15.0 16.0 14.2 13.8 14.5 15.1 14.2 30.3 21.8 15.6 13.4 15.1 13.4 EV/Sales (x) FY14E FY15E 1.5 0.6 1.3 0.4 0.5 0.5 1.9 1.0 2.6 0.2 1.4 1.4 1.1 0.3 1.1 0.9 0.6 0.4 0.4 0.2 1.3 0.5 1.1 0.4 0.4 0.4 1.6 0.8 2.2 0.1 1.2 1.2 0.9 0.3 0.9 0.7 0.5 0.3 0.4 0.1 -

Agri / Agri Chemical Rallis Neutral United Phosphorus Buy Auto & Auto Ancillary Amara Raja Batteries Accumulate Apollo Tyres Buy Ashok Leyland Buy Automotive Axle# Neutral Bajaj Auto Accumulate Bharat Forge Neutral Bosch India* Neutral CEAT Buy Exide Industries Accumulate FAG Bearings* Neutral Hero Motocorp Accumulate JK Tyre Buy Mahindra and Mahindra Neutral Maruti Accumulate Motherson Sumi Accumulate Subros Buy Tata Motors Accumulate TVS Motor Neutral Financials Allahabad Bank Buy Andhra Bank Neutral Axis Bank Buy Bank of Baroda Buy Bank of India Buy Bank of Maharashtra Accumulate Canara Bank Accumulate Central Bank Neutral Corporation Bank Buy Dena Bank Accumulate Federal Bank Neutral HDFC Neutral HDFC Bank Neutral ICICI Bank Buy IDBI Bank Accumulate Indian Bank Buy IOB Accumulate

Please refer to important disclosures at the end of this report.

29

Stock W atch | May 2013 Watch
Company Name J & K Bank LIC Housing Finance Oriental Bank Punjab Natl.Bank South Ind.Bank St Bk of India Syndicate Bank UCO Bank Union Bank United Bank Vijaya Bank Yes Bank Capital Goods ABB* BGR Energy BHEL Blue Star Crompton Greaves Jyoti Structures KEC International Thermax Cement ACC Ambuja Cements India Cements J K Lakshmi Cement Madras Cements Shree Cement^ UltraTech Cement Construction Ashoka Buildcon Consolidated Co IRB Infra ITNL IVRCL Infra Buy Neutral Buy Buy Buy 204 12 121 174 19 255 157 230 35 1,075 218 4,015 3,375 582 1,928 2,281 3,997 7,444 6,287 2,234 2,492 4,312 8,041 6,836 21.0 5.9 45.5 27.4 8.5 21.5 6.9 46.4 28.9 8.5 18.0 0.7 15.7 29.8 2.3 22.2 2.0 16.6 32.1 3.0 11.4 17.3 7.7 5.8 8.1 9.2 5.9 7.3 5.4 6.2 1.0 0.4 1.1 0.8 0.3 0.9 0.4 1.0 0.7 0.3 10.2 2.3 15.2 14.9 3.3 10.1 6.5 14.5 14.2 4.2 1.9 0.4 3.4 2.5 0.5 1.9 0.3 3.7 2.6 0.5 Accumulate 1,223 Neutral Neutral Buy Neutral Neutral Neutral 186 72 100 246 4,915 1,948 1,361 143 22,956 28,632 2,201 1,180 5,862 17,121 53,398 11,979 10,232 4,777 2,313 4,293 6,540 21,947 13,254 11,762 5,276 2,728 4,855 7,452 25,049 19.7 23.5 17.3 19.8 27.4 27.4 23.8 21.3 24.5 17.1 20.7 28.6 26.6 23.8 77.1 10.3 8.8 16.0 21.8 319.7 106.1 91.4 12.2 10.8 22.1 28.2 369.9 119.8 15.9 18.0 8.1 6.2 11.3 15.4 18.4 13.4 15.3 6.6 4.5 8.7 13.3 16.3 2.8 3.0 0.6 0.8 2.0 3.8 3.0 2.5 2.7 0.6 0.7 1.7 3.0 2.6 18.6 17.2 7.5 13.2 19.6 27.5 17.7 20.0 18.6 8.8 15.8 21.3 25.4 17.3 1.6 2.3 0.8 1.1 1.8 2.0 2.5 1.4 1.9 0.7 0.8 1.5 1.5 2.2 Sell Neutral Neutral Buy Buy Buy Buy Neutral 661 190 193 167 96 28 43 583 461 230 117 34 63 14,015 1,369 47,202 1,501 6,181 229 1,114 6,952 8,073 4,114 44,054 2,896 13,790 3,074 7,709 5,780 9,052 4,886 39,326 3,087 15,095 3,355 8,399 6,430 5.5 11.3 16.8 5.6 6.4 9.0 6.7 9.5 6.9 10.7 15.1 6.1 7.4 8.8 7.2 9.6 11.5 24.9 20.6 9.3 6.9 8.7 6.1 29.8 16.9 28.0 16.1 11.7 9.4 10.2 8.5 33.0 57.4 7.6 9.4 17.9 14.0 3.2 7.1 19.6 39.0 6.8 12.0 14.2 10.3 2.7 5.1 17.7 5.2 1.0 2.0 3.0 1.6 0.3 0.9 3.3 5.0 0.9 1.8 2.5 1.4 0.3 0.8 2.9 9.3 25.2 23.5 17.5 11.7 10.4 20.2 17.9 13.1 22.6 16.1 19.1 14.5 11.1 23.0 17.4 1.7 0.6 0.9 0.6 0.5 0.3 0.3 1.0 1.5 0.6 1.0 0.5 0.4 0.2 0.3 0.9 Reco CMP (`) 275 259 788 25 2,151 130 77 227 56 52 506 Target Price (`) 1,315 298 285 993 2,637 142 260 65 Mkt Cap (` cr) 6,053 13,866 7,549 27,843 3,351 147,146 7,804 5,761 13,559 2,080 2,567 18,164 Sales (` cr) FY14E FY15E 3,074 2,113 6,835 20,876 1,839 67,243 7,238 6,250 11,229 3,443 2,730 4,390 3,140 2,525 7,588 23,929 2,091 76,612 8,249 6,738 12,794 3,998 3,059 5,411 OPM (%) FY14E FY15E 3.5 2.3 2.6 3.3 2.9 3.1 2.6 2.6 2.6 2.3 1.9 2.8 3.2 2.3 2.6 3.4 2.8 3.0 2.6 2.5 2.6 2.6 2.0 2.8 EPS (`) FY14E FY15E 224.7 25.4 56.5 151.7 4.2 242.4 27.1 12.1 40.7 15.1 10.2 41.6 201.5 29.2 63.8 177.0 4.5 284.8 30.4 14.7 48.2 20.4 11.3 47.8 PER (x) FY14E FY15E 5.6 10.8 4.6 5.2 6.0 8.9 4.8 6.4 5.6 3.7 5.1 12.2 6.2 9.4 4.1 4.5 5.6 7.6 4.3 5.2 4.7 2.7 4.6 10.6 P/BV (x) FY14E FY15E 1.1 1.9 0.6 0.8 1.0 1.4 0.7 1.0 0.8 0.5 0.6 2.6 0.9 1.7 0.5 0.7 0.9 1.2 0.6 0.8 0.7 0.4 0.5 2.1 RoE (%) FY14E FY15E 20.6 18.4 13.1 16.1 18.2 16.3 16.0 11.8 14.6 12.1 11.8 23.2 16.1 18.3 13.3 16.5 17.0 16.8 15.9 13.0 15.4 14.8 12.0 22.1 EV/Sales (x) FY14E FY15E -

Accumulate 1,249 Accumulate Accumulate Buy Neutral Buy Accumulate Neutral Accumulate Buy Neutral Neutral

Please refer to important disclosures at the end of this report.

30

Stock W atch | May 2013 Watch
Company Name Jaiprakash Asso. Larsen & Toubro Nagarjuna Const. Punj Lloyd Sadbhav Engg. Simplex Infra Unity Infra FMCG Asian Paints Britannia Colgate Dabur India GlaxoSmith Con* Godrej Consumer HUL ITC Marico Nestle* Tata Global IT HCL Tech^ Hexaware* Infosys Infotech Enterprises KPIT Cummins Mahindra Satyam Mindtree Mphasis& NIIT Persistent TCS Tech Mahindra Wipro Media D B Corp HT Media Jagran Prakashan PVR Sun TV Network Reco Buy Buy Buy Neutral Buy Buy Buy Neutral Neutral Neutral Neutral Neutral Neutral Neutral Neutral Neutral Neutral Neutral CMP (`) 68 1,457 32 46 112 103 31 4,805 574 1,462 158 4,864 825 586 330 221 5,250 141 Target Price (`) 90 1,761 42 153 164 45 863 96 2,465 185 135 126 920 395 30 593 1,585 1,170 385 290 117 121 Mkt Cap (` cr) 15,090 89,720 819 1,538 1,688 509 229 46,088 6,870 19,878 27,582 20,454 28,085 126,797 260,760 14,243 50,621 8,738 51,283 2,382 134,767 1,887 2,045 12,916 3,311 9,236 351 2,032 287,711 12,225 82,921 4,582 2,291 3,007 1,304 16,195 Sales (` cr) FY14E FY15E 14,850 68,946 6,167 12,954 2,511 6,824 2,455 12,332 6,417 3,588 7,183 3,617 7,801 29,167 34,294 5,273 9,447 7,998 28,633 2,091 43,338 1,956 2,513 8,278 2,599 6,096 1,144 1,445 71,833 7,779 40,173 1,750 2,205 1,698 1,343 2,287 15,631 78,040 6,945 14,740 2,736 7,563 2,734 14,524 7,446 4,130 8,340 4,259 9,017 33,164 39,991 6,044 10,968 8,798 32,216 2,289 47,244 2,174 2,819 9,062 2,871 6,646 1,267 1,617 81,893 8,398 43,697 1,925 2,380 1,908 1,521 2,551 OPM (%) FY14E FY15E 24.9 10.5 8.0 9.8 10.6 9.2 13.4 16.5 5.1 21.1 16.8 16.1 16.2 13.6 36.8 14.8 22.1 9.7 21.5 19.0 27.5 17.9 16.1 20.3 19.4 17.6 9.0 25.1 28.4 19.7 20.4 25.1 15.1 23.9 18.8 69.7 25.0 10.5 8.2 9.8 10.6 9.4 13.0 16.3 5.5 21.6 16.8 16.4 15.9 13.7 37.0 14.9 22.3 9.8 20.7 18.8 27.7 17.7 15.5 20.1 19.2 17.4 9.1 25.0 27.9 19.3 20.6 26.6 15.6 24.5 18.9 70.4 EPS (`) FY14E FY15E 2.5 77.9 2.7 0.5 7.3 18.0 14.6 141.5 20.3 44.7 5.4 122.2 25.1 17.1 11.3 7.3 127.5 7.9 57.3 10.6 169.4 20.4 12.6 10.5 85.2 38.1 4.3 55.3 78.5 107.4 26.2 14.2 8.3 7.4 18.3 20.0 2.9 88.3 3.6 0.9 7.8 23.4 14.9 162.7 25.2 51.9 6.3 148.7 29.7 18.4 13.3 8.7 154.1 8.7 61.7 11.3 182.6 21.9 14.0 11.4 92.3 41.6 5.4 59.3 88.0 117.8 28.5 16.8 9.1 8.4 22.9 23.3 PER (x) FY14E FY15E 26.9 18.7 11.9 91.2 15.4 5.7 2.1 33.9 28.4 32.7 29.5 39.8 32.8 34.3 29.3 30.4 41.2 17.9 12.9 7.5 13.9 8.3 8.4 10.4 9.4 11.5 4.9 9.2 18.7 8.9 12.8 17.6 11.8 12.3 18.0 20.5 23.8 16.5 8.8 49.7 14.4 4.4 2.1 29.5 22.8 28.2 25.2 32.7 27.8 31.9 24.7 25.5 34.1 16.2 11.9 7.0 12.9 7.7 7.6 9.6 8.6 10.6 4.0 8.6 16.7 8.1 11.8 14.9 10.7 10.8 14.4 17.6 P/BV (x) FY14E FY15E 1.1 2.7 0.3 0.5 1.9 0.4 0.2 10.7 9.6 29.0 11.5 12.4 7.1 33.0 9.6 5.9 20.6 2.2 3.0 1.7 2.9 1.2 1.5 2.4 2.0 1.6 0.5 1.7 5.7 1.9 2.5 3.8 1.3 3.1 1.7 5.1 1.1 2.4 0.3 0.5 1.7 0.4 0.2 8.5 7.6 21.7 8.9 10.0 5.9 23.9 7.8 4.9 14.9 2.1 2.5 1.5 2.5 1.1 1.2 1.9 1.6 1.4 0.5 1.4 4.7 1.5 2.2 3.2 1.2 2.7 1.8 4.5 RoE (%) FY14E FY15E 4.2 15.5 2.7 0.6 13.3 6.8 12.3 35.4 37.4 98.3 41.5 34.1 24.8 113.4 36.1 21.4 57.7 9.5 24.0 22.8 20.8 14.7 17.9 23.1 21.4 14.2 10.3 18.1 30.2 21.2 19.7 23.4 11.5 26.7 10.6 26.4 4.7 15.6 3.6 1.1 12.7 8.3 11.3 32.2 37.3 88.0 40.1 33.7 24.2 87.0 34.9 21.0 50.7 9.8 21.5 21.7 19.3 13.7 16.6 20.0 18.9 13.6 11.9 16.5 27.9 19.0 18.4 23.4 11.4 26.8 12.3 27.3 EV/Sales (x) FY14E FY15E 2.8 1.4 0.5 0.5 0.9 0.5 0.4 3.6 1.0 5.3 3.8 5.2 3.7 4.2 7.3 2.7 5.4 1.0 1.6 1.0 2.5 0.6 0.8 1.1 1.0 1.0 0.1 1.0 3.8 1.6 1.5 2.5 0.7 1.9 1.0 6.7 2.8 1.3 0.5 0.5 0.8 0.4 0.5 3.0 0.8 4.6 3.2 4.3 3.2 3.7 6.2 2.3 4.5 0.9 1.4 0.9 2.1 0.5 0.6 0.9 0.8 0.8 0.0 0.8 3.2 1.4 1.3 2.2 0.6 1.7 0.8 5.9

Buy 736 Buy 80 Accumulate 2,347 Accumulate 169 Buy 106 Accumulate 110 Buy 797 Reduce 440 Buy 21 Buy 508 Accumulate 1,470 Buy 952 Accumulate 337 Buy Buy Buy Neutral Neutral 250 98 91 329 411

Please refer to important disclosures at the end of this report.

31

Stock W atch | May 2013 Watch
Company Name Metal Bhushan Steel Coal India Electrosteel Castings GMDC Hind. Zinc Hindalco JSW Steel MOIL Monnet Ispat Nalco NMDC SAIL Sesa Goa Sterlite Inds Tata Steel Sarda Prakash Industries Godawari Power Oil & Gas Cairn India GAIL ONGC Reliance Industries Gujarat Gas* Indraprastha Gas Petronet LNG Gujarat State Petronet Pharmaceuticals Alembic Pharma Aurobindo Pharma Aventis* Cadila Healthcare Cipla Dr Reddy's Dishman Pharma GSK Pharma* Indoco Remedies Ipca labs Lupin Ranbaxy* Sun Pharma Reco CMP (`) 465 310 17 137 117 107 713 201 167 34 117 60 160 94 313 103 37 81 283 322 325 788 239 279 139 58 Target Price (`) 345 24 213 145 243 291 179 100 430 153 45 118 345 354 167 139 264 962 463 2,535 206 89 676 877 Mkt Cap (` cr) 10,524 196,028 554 4,366 49,500 20,505 15,898 3,384 1,064 8,685 46,209 24,739 13,923 31,439 30,414 368 498 265 54,032 40,845 278,011 254,439 3,069 3,902 10,448 3,289 2,223 4,996 5,688 16,250 32,779 35,060 548 19,208 554 7,200 34,459 16,514 100,260 Sales (` cr) FY14E FY15E 13,794 72,174 1,976 1,944 12,358 88,987 39,973 954 2,883 8,187 10,329 53,685 3,742 44,462 141,775 1,494 2,615 2,425 16,482 55,815 157,962 380,031 3,707 3,700 40,356 1,079 1,736 6,279 1,682 7,386 9,130 13,377 1,536 2,854 774 3,474 11,641 11,400 12,563 17,335 76,311 2,017 2,317 13,659 94,163 40,926 1,062 3,181 8,416 12,540 64,183 4,426 45,568 151,672 1,568 2,776 2,552 16,228 63,013 175,367 407,721 3,850 4,218 40,872 983 2,008 7,033 1,917 8,863 10,543 15,350 1,739 3,145 938 4,168 13,933 12,060 14,698 OPM (%) FY14E FY15E 30.7 33.3 11.8 49.9 51.4 9.2 17.2 45.5 21.7 14.5 73.8 9.3 32.9 23.2 10.5 19.1 12.1 13.7 69.4 15.3 35.1 9.9 11.7 23.4 5.8 91.8 17.1 16.0 16.6 18.0 24.8 20.4 20.2 28.6 15.2 21.0 21.3 10.5 42.6 34.8 28.4 12.7 51.7 51.6 9.7 17.0 47.4 23.6 14.7 75.0 12.2 32.8 24.7 11.3 20.3 12.0 14.8 53.3 15.2 36.2 69.3 12.4 22.8 6.4 91.9 18.9 16.0 16.6 18.0 23.0 20.1 20.9 28.6 15.2 21.0 21.3 12.5 42.6 EPS (`) FY14E FY15E 48.9 28.4 1.3 20.7 16.0 13.8 71.9 26.1 40.3 3.2 16.6 5.5 30.0 18.1 35.3 31.3 9.8 33.5 53.3 35.9 34.3 69.3 23.7 26.6 15.0 8.7 10.7 15.2 92.4 39.5 21.6 112.3 15.4 76.6 7.2 37.3 34.8 17.5 29.8 83.6 30.9 2.6 25.6 17.6 15.9 82.8 29.1 57.7 3.3 19.0 8.3 29.8 20.2 51.7 36.5 10.4 45.3 49.6 41.5 39.3 78.0 25.7 30.4 16.7 7.8 13.9 19.2 99.1 48.1 23.2 126.8 20.6 83.3 8.9 45.1 41.8 22.5 35.5 PER (x) FY14E FY15E 9.5 10.9 13.4 6.6 7.3 7.8 9.9 7.7 4.1 10.5 7.0 10.9 5.3 5.2 8.9 3.3 3.8 2.4 5.3 9.0 9.5 11.4 10.1 10.5 9.3 6.7 11.0 11.3 26.7 20.1 18.9 18.4 4.4 29.6 8.3 15.3 22.1 22.3 32.5 5.6 10.1 6.5 5.4 6.7 6.8 8.6 6.9 2.9 10.3 6.1 7.3 5.4 4.6 6.1 2.8 3.6 1.8 5.7 7.8 8.3 10.1 9.3 9.2 8.3 7.5 8.5 8.9 24.9 16.5 17.6 16.3 3.3 27.2 6.8 12.7 18.4 17.3 27.3 P/BV (x) FY14E FY15E 1.0 3.0 0.1 1.5 1.3 0.6 0.9 1.1 0.4 0.7 1.3 0.6 0.7 0.6 0.7 0.4 0.2 0.2 0.8 1.4 1.6 1.1 2.8 2.2 2.0 1.1 3.5 1.5 3.8 4.5 3.1 3.9 0.5 8.9 1.1 3.6 5.2 3.6 5.8 0.9 2.6 0.1 1.2 1.1 0.5 0.8 1.0 0.3 0.7 1.2 0.5 0.6 0.5 0.6 0.3 0.2 0.2 0.7 1.2 1.5 1.0 2.5 1.8 1.6 1.0 2.6 1.3 3.7 3.7 2.7 3.3 0.4 8.1 1.0 2.9 4.1 3.1 4.9 RoE (%) FY14E FY15E 11.2 37.6 2.6 24.2 19.4 7.6 9.0 15.1 10.1 6.8 20.6 5.4 14.3 11.3 7.6 11.8 6.5 11.2 16.5 17.0 18.2 11.5 29.6 22.6 22.9 17.8 35.0 19.2 15.7 24.8 17.6 23.5 11.6 31.1 14.5 26.4 26.2 17.0 19.2 16.7 36.2 5.2 24.6 18.4 8.1 9.6 15.2 13.0 6.7 20.2 7.7 12.5 11.4 10.3 12.4 6.5 13.1 13.6 17.1 18.6 11.7 28.2 21.7 21.5 14.1 34.7 18.0 14.8 24.7 16.2 21.8 13.7 31.0 15.8 25.3 24.8 19.1 19.3 EV/Sales (x) FY14E FY15E 2.4 1.9 0.6 1.8 1.7 0.6 0.7 1.1 1.2 0.5 2.3 0.8 4.5 0.6 0.5 0.6 0.4 0.5 1.9 0.6 1.5 0.6 0.7 1.1 0.3 2.8 1.3 1.3 3.0 2.5 3.3 2.7 1.0 5.9 0.9 2.2 3.0 1.4 7.4 1.9 1.7 0.2 1.3 1.2 0.5 0.7 0.8 1.0 0.5 1.8 0.8 3.7 0.6 0.5 0.5 0.4 0.4 1.6 0.4 1.3 0.6 0.6 0.9 0.3 3.0 1.1 1.1 2.4 2.0 2.7 2.3 0.8 5.2 0.8 1.8 2.4 1.3 6.1

Neutral Accumulate Buy Buy Buy Neutral Neutral Buy Buy Neutral Buy Neutral Neutral Accumulate Buy Buy Buy Buy Buy Neutral Accumulate Neutral Neutral Neutral Buy Neutral

Buy 118 Buy 172 Neutral 2,470 Buy 794 Accumulate 408 Buy 2,065 Buy 68 Neutral 2,268 Buy 60 Buy 571 Accumulate 770 Neutral 390 Neutral 970

Please refer to important disclosures at the end of this report.

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Stock W atch | May 2013 Watch
Company Name Power GIPCL NTPC Real Estate DLF MLIFE Telecom Bharti Airtel Idea Cellular Rcom Others Abbott India* Bajaj Electricals Cera Sanitaryware Cravatex Finolex Cables Force Motors Goodyear India* Hitachi Honeywell Automation* IFB Agro ITD Cementation Jyothy Laboratories MRF Page Industries Relaxo Footwears Siyaram Silk Mills Styrolution ABS India* TAJ GVK Tata Sponge Iron TTK Healthcare Tree House TVS Srichakra United Spirits Vesuvius India* Reco CMP (`) 74 150 212 397 299 129 108 Target Price (`) 78 163 288 476 338 1,659 237 562 566 68 437 345 177 198 234 199 14,416 3,637 791 331 617 108 371 686 275 252 439 Mkt Cap (` cr) 1,123 123,888 37,677 1,619 113,641 42,662 22,353 3,070 1,698 566 94 815 487 619 388 2,156 148 211 2,892 6,476 4,338 750 245 764 433 460 492 935 142 33,608 749 Sales (` cr) FY14E FY15E 1,535 76,734 9,699 888 86,592 25,122 22,801 1,863 3,929 630 308 2,563 2,304 1,458 1,053 1,842 495 1,430 1,220 11,799 1,046 1,146 1,157 1,068 300 814 435 150 1,591 12,294 600 1,570 86,680 12,010 1,002 95,860 27,663 24,628 2,081 4,480 795 351 2,899 2,649 1,542 1,169 2,131 651 1,573 1,476 12,587 1,281 1,333 1,320 1,223 319 849 516 192 1,739 14,162 638 OPM (%) FY14E FY15E 31.9 24.5 37.0 30.6 31.4 27.0 31.0 11.8 7.4 14.4 7.0 9.8 3.1 8.3 6.3 7.7 12.7 11.1 13.3 14.1 19.6 10.9 11.9 9.6 35.8 17.0 6.2 52.6 6.1 12.0 20.1 31.6 24.3 36.8 30.6 31.7 27.2 31.3 12.4 7.7 13.6 7.0 9.8 3.6 9.0 7.1 7.8 12.9 11.0 13.6 13.5 19.7 11.4 11.8 9.6 36.2 17.6 7.1 52.5 6.6 12.0 19.4 EPS (`) FY14E FY15E 13.1 13.4 6.0 38.8 10.9 4.0 3.6 71.2 15.5 42.8 39.6 10.1 28.0 32.3 13.8 112.4 29.3 19.1 5.5 1,792.4 127.3 45.9 72.2 38.1 7.9 64.6 24.3 12.8 24.5 42.1 35.7 14.1 14.5 8.4 43.4 14.5 4.8 5.3 82.9 19.7 51.1 47.2 11.3 43.7 37.0 17.7 132.4 39.5 26.9 9.0 1,802.0 158.1 60.9 82.8 44.1 9.1 69.2 33.3 16.2 41.9 67.7 36.5 PER (x) FY14E FY15E 5.7 11.2 35.5 10.2 27.5 32.4 30.4 20.3 11.0 10.5 9.2 5.3 13.4 8.3 10.3 21.7 5.6 9.6 32.5 8.5 30.5 13.6 3.6 11.4 8.7 4.6 26.1 20.3 7.6 61.0 10.3 5.3 10.4 25.2 9.1 20.6 27.0 20.6 17.4 8.6 8.7 7.7 4.7 8.6 7.2 8.0 18.4 4.2 6.8 19.8 8.5 24.6 10.3 3.2 9.9 7.6 4.3 19.0 16.0 4.4 38.0 10.1 P/BV (x) FY14E FY15E 0.7 1.4 1.3 1.1 2.1 2.7 0.7 4.1 1.9 2.5 2.0 0.8 0.4 1.5 1.5 2.7 0.8 0.5 3.7 1.8 14.6 2.8 0.7 1.6 1.2 0.6 4.3 2.0 0.8 4.3 1.9 0.6 1.3 1.3 1.0 1.9 2.5 0.6 3.5 1.6 2.0 1.6 0.7 0.4 1.3 1.2 2.4 0.7 0.5 3.3 1.5 10.6 2.3 0.6 1.4 1.0 0.6 3.7 1.8 0.7 3.9 1.6 RoE (%) FY14E FY15E 12.4 12.8 3.8 11.2 7.7 8.3 2.1 21.6 17.4 26.6 21.8 14.3 3.1 19.5 15.0 13.3 15.4 4.9 12.1 23.5 54.9 23.0 19.7 14.4 13.9 14.5 17.6 10.0 10.9 9.1 19.4 12.2 12.7 5.1 11.4 9.3 9.1 3.1 21.5 18.7 25.2 21.0 13.8 4.7 19.3 16.7 13.8 17.6 6.3 17.7 19.2 50.0 24.6 19.0 14.7 14.4 13.8 20.8 11.1 17.2 10.7 17.1 EV/Sales (x) FY14E FY15E 1.0 2.3 5.3 2.4 2.0 2.1 2.6 1.4 0.4 0.9 0.4 0.2 0.1 0.2 0.4 1.1 0.4 0.6 2.7 0.6 4.2 0.8 0.4 0.7 1.8 0.2 1.0 5.8 0.3 3.1 1.0 0.8 2.2 4.3 2.1 1.6 1.9 2.2 1.1 0.4 0.7 0.3 0.2 0.1 0.2 0.4 0.9 0.3 0.5 2.1 0.6 3.5 0.7 0.4 0.6 1.5 (0.0) 0.8 4.4 0.2 2.6 0.9

Accumulate Accumulate Buy Buy Accumulate Neutral Neutral

Accumulate 1,445 Buy 170 Buy 447 Buy 365 Buy 53 Buy 374 Buy 268 Buy 143 Neutral 2,438 Buy 164 Buy 183 Accumulate 179 Reduce 15,270 Reduce 3,889 Buy 625 Buy 261 Buy 434 Buy 69 Buy 299 Accumulate 634 Accumulate 260 Buy 185 Neutral 2,570 Buy 369

Source: Company, Angel Research, Note: *December year end; #September year end; &October year end; ^June year end; Price as on May 24, 2013

Please refer to important disclosures at the end of this report.

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Market Strategy

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Ratings (Returns) :

Buy (> 15%) Reduce (-5% to -15%)

Accumulate (5% to 15%) Sell (< -15%)

Neutral (-5 to 5%)

May 2013

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Market Strategy
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Research Team Fundamental: Sarabjit Kour Nangra Vaibhav Agrawal Bhavesh Chauhan Viral Shah Sharan Lillaney V Srinivasan Yaresh Kothari Ankita Somani Sourabh Taparia Bhupali Gursale Vinay Rachh Amit Patil Shareen Batatawala Twinkle Gosar Tejashwini Kumari Akshay Narang Harshal Patkar Technicals: Shardul Kulkarni Sameet Chavan Sacchitanand Uttekar Derivatives: Siddarth Bhamre Institutional Sales Team: Mayuresh Joshi Hiten Sampat Meenakshi Chavan Gaurang Tisani Akshay Shah Production Team: Tejas Vahalia Dilip Patel Research Editor Production Incharge [email protected] [email protected] VP - Institutional Sales Sr. A.V.P- Institution sales Dealer Dealer Sr. Executive [email protected] [email protected] [email protected] [email protected] [email protected] Head - Derivatives [email protected] Sr. Technical Analyst Technical Analyst Technical Analyst [email protected] [email protected] [email protected] VP-Research, Pharmaceutical VP-Research, Banking Sr. Analyst (Metals & Mining) Sr. Analyst (Infrastructure) Analyst (Mid-cap) Analyst (Cement, FMCG) Analyst (Automobile) Analyst (IT, Telecom) Analyst (Banking) Economist Research Associate Research Associate Research Associate Research Associate Research Associate Research Associate Research Associate [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected]

CSO & Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093.Tel.: (022) 3083 7700. Angel Broking Ltd: BSE Sebi Regn No: INB010996539 / PMS Regd Code: PM/INP000001546 / CDSL Regn No: IN - DP - CDSL - 234 - 2004 / NSE Sebi Regn Nos: Cash: INB231279838 / NSE F&O: INF231279838/ Currency: INE231279838 / MCX Currency Sebi Regn No: INE261279838 / Member ID: 10500 / Angel Commodities Broking Pvt. Ltd: MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX : Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302

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