November 17, 2016 ICICI Securities Ltd | Retail Equity Research Result Update Strong product cycle in JLR to aid growth... • Tata Motors’ (TML) Q2FY17 results were below our estimates. Consolidated revenues came in at | 65900 crore (up 7% YoY), below our estimates of | 66717 crore. JLR’s revenues came in at £5953 mn (up 23% YoY, 9% QoQ), almost in line with our estimate of £5959 mn. JLR’s wholesale volumes were at 139235 units (including China JV), up 19.3% YoY. Standalone came at | 10,322.5 crore (up 3.5% YoY, flat QoQ), against our estimates of | 10,965 crore. The miss on the estimates is on account of lower than estimated ASP • JLR’s reported EBITDA margin for Q2FY17 was at 10.3%, lower than our estimate of 13.5%. However, margins were impacted by a charge of £58 million (mn) for revaluation of current assets/liabilities & £150 mn towards one-time provision for new customer loyalty programme. Adjusting for one time loyalty programme, EBITDA margin was at 12.9% vs. our estimate of 13.5%. Standalone EBITDA margin came in at 3.6% (down 454 bps YoY, 305 bps QoQ) against our estimate of 6%. EBITDA margins were lower than our estimates due to gross margin contraction QoQ due to poor product mix • Consequently, JLR reported a PAT of £244 mn vs. our estimate of £341 mn while standalone loss was at | 630.8 crore vs. our estimated PAT of | 99.5 crore JLR growth story intact In FY16, JLR’s retail volumes grew 13% YoY to 521,571 units, with growth in regions like UK (24%), North America (27%) & Europe (42%) offset by a decline of 16% in China. Going ahead, we expect JLR’s profit to grow at a CAGR of 18% on the back of 1) strong product cycle (recently launched XE & F-Pace and Land Rover will recover in H2FY17 with the launch of Evoque Convertible, new Discovery in Q4FY17E, midsize Range Rover (RR) in mid-FY18 & mid-cycle refresh of RR/RR Sport 2) favourable foreign exchange (functional currency of JLR being GBP), depreciated GBP will benefit JLR in terms of revenue/margins once hedge & spot converge 3) long term benefit of modular strategy - more models on fewer platforms will reduce cost, 4) ramp up in China JV and 5) new production capacity in Slovakia Standalone business-near term challenge The recent demonetisation event will adversely impact domestic volumes in the short term. Although finance penetration in commercial vehicle segment is high (>95%), near term adverse impact will be felt as working capital of most fleet operators is cash based and will impact demand. However, volumes are expected to grow in Q4FY17 on the back of pre- buying due to implementation of emission norms on April 17. We expect growth in FY18 on the back of growth in economic activity & higher infrastructure spend. On the PV side, TML plans to launch two models per year till 2020. Overall, we expect standalone volumes to grow 15%, 18% for FY17E, FY18E, respectively. Long term story intact We remain positive on sustained earnings growth for the JLR business as the product pipeline grows and market share increases across geographies. We value the stock on an SOTP basis, with JLR (ex-China JV) at 3.8x EV/EBIDTA basis contributing ~| 520/share while the domestic business contributes | 52/share. Inclusive of other subsidiaries, we arrive at a target price of | 595. Rating matrix Rating : Buy Target : | 595 Target Period : 12 months Potential Upside : 26% What’s Changed? Target Changed from | 660 to | 595 EPS FY17E Changed from | 57.6 to | 35.5 EPS FY18E Changed from | 67.7 to | 61.3 Rating Unchanged Quarterly Performance Q2FY17 Q2FY16 YoY (%) Q1FY17 QoQ (%) Revenue 65,900.4 61,524.0 7.1 65,895.0 0.0 EBITDA 7,024.5 6,518.9 7.8 8,484.1 -17.2 EBITDA (%) 10.7 10.6 6 bps 12.9 -222 bps PAT 848.2 -1,740.2 -148.7 2,260.4 -62.5 Key Financials | Crore FY15E FY16E FY17E FY18E Net Sales 260,734 272,646 285,785 343,767 EBITDA 42,114 41,851 39,479 55,575 Net Profit 13,986 12,638 12,060 20,827 EPS (|) 41.2 37.2 35.5 61.3 Valuation summary FY15E FY16E FY17E FY18E P/E (x) 11. 5 12.7 13.3 7.7 Target P/E (x) 14.5 16.0 16.8 9.7 EV/EBITDA (x) 4.2 3.9 4.1 2.9 P/BV (x) 2.8 1.9 1.6 1.3 RoNW (%) 24.9 15.3 11.7 16.8 RoCE (%) 22.8 17.0 12.9 18.3 Stock data Particular Amount Market Capitalization | 161291 Crore Total Debt (FY16) | 63099.9 Crore Cash and Investments (FY16) | 53707.7 Crore EV (FY16) | 163158.9 Crore 52 week H/L (|) 593 / 266 Equity capital (| crore) | 679.1 Crore Face value (|) | 2 Price performance (%) 1M 3M 6M 12M Tata Motors Ltd -17.6 -9.7 16.7 14.5 M&M Ltd -8.8 -14.3 -6.0 -3.2 Maruti Suzuki India Ltd -12.3 2.6 28.6 7.4 Tata Motors (TELCO) | 474 Research Analyst Nishit Zota [email protected]Vidrum Mehta [email protected]
12
Embed
Tata Motors (TELCO) - ICICI Directcontent.icicidirect.com/mailimages/IDirect_TataMotors_Q2FY17.pdf · Exhibit 3: Jaguar market mix movement Q2FY17 UK 23% N America China 26% 16% Europe
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
November 17, 2016
ICICI Securities Ltd | Retail Equity Research
Result Update
Strong product cycle in JLR to aid growth... • Tata Motors’ (TML) Q2FY17 results were below our estimates.
Consolidated revenues came in at | 65900 crore (up 7% YoY), below our estimates of | 66717 crore. JLR’s revenues came in at £5953 mn (up 23% YoY, 9% QoQ), almost in line with our estimate of £5959 mn. JLR’s wholesale volumes were at 139235 units (including China JV), up 19.3% YoY. Standalone came at | 10,322.5 crore (up 3.5% YoY, flat QoQ), against our estimates of | 10,965 crore. The miss on the estimates is on account of lower than estimated ASP
• JLR’s reported EBITDA margin for Q2FY17 was at 10.3%, lower than our estimate of 13.5%. However, margins were impacted by a charge of £58 million (mn) for revaluation of current assets/liabilities & £150 mn towards one-time provision for new customer loyalty programme. Adjusting for one time loyalty programme, EBITDA margin was at 12.9% vs. our estimate of 13.5%. Standalone EBITDA margin came in at 3.6% (down 454 bps YoY, 305 bps QoQ) against our estimate of 6%. EBITDA margins were lower than our estimates due to gross margin contraction QoQ due to poor product mix
• Consequently, JLR reported a PAT of £244 mn vs. our estimate of £341 mn while standalone loss was at | 630.8 crore vs. our estimated PAT of | 99.5 crore
JLR growth story intact In FY16, JLR’s retail volumes grew 13% YoY to 521,571 units, with growth in regions like UK (24%), North America (27%) & Europe (42%) offset by a decline of 16% in China. Going ahead, we expect JLR’s profit to grow at a CAGR of 18% on the back of 1) strong product cycle (recently launched XE & F-Pace and Land Rover will recover in H2FY17 with the launch of Evoque Convertible, new Discovery in Q4FY17E, midsize Range Rover (RR) in mid-FY18 & mid-cycle refresh of RR/RR Sport 2) favourable foreign exchange (functional currency of JLR being GBP), depreciated GBP will benefit JLR in terms of revenue/margins once hedge & spot converge 3) long term benefit of modular strategy - more models on fewer platforms will reduce cost, 4) ramp up in China JV and 5) new production capacity in Slovakia Standalone business-near term challenge The recent demonetisation event will adversely impact domestic volumes in the short term. Although finance penetration in commercial vehicle segment is high (>95%), near term adverse impact will be felt as working capital of most fleet operators is cash based and will impact demand. However, volumes are expected to grow in Q4FY17 on the back of pre-buying due to implementation of emission norms on April 17. We expect growth in FY18 on the back of growth in economic activity & higher infrastructure spend. On the PV side, TML plans to launch two models per year till 2020. Overall, we expect standalone volumes to grow 15%, 18% for FY17E, FY18E, respectively. Long term story intact We remain positive on sustained earnings growth for the JLR business as the product pipeline grows and market share increases across geographies. We value the stock on an SOTP basis, with JLR (ex-China JV) at 3.8x EV/EBIDTA basis contributing ~| 520/share while the domestic business contributes | 52/share. Inclusive of other subsidiaries, we arrive at a target price of | 595.
Total Operating Income 65,900 66,717 61,524 7.1 65,895 0.0 Consolidated revenues came in below estimates as standalone revenues were below estimates due to lower than estimated ASPs
EBITDA 7,024.5 9,278 6,518.9 7.8 8,484 -17.2EBITDA Margin (%) 10.7 13.9 10.6 6 bps 12.9 -222 bps Margins came in lower due to lower than estimated JLR margins & standalone
margins. The reported JLR margins were impacted due to a charge of £58 million for revaluation of current assets/liabilities & £ 150 million towards one time provision for new customer loyalty programme. Standalone margins came down sequentially due to gross margin contraction QoQ mainly due to a poor product mix
Depreciation 4454.0 4489.8 4361.8 2.1 4550.8 -2.1Interest 1025 1127 1223 -16.2 1169 -12.4Product Development expenditure 742.0 824.0 843.1 -12.0 871.1 -14.8Tax 425 773 -429 -199.0 720 -41.0PAT 848.2 2289.1 -1740.2 -148.7 2260.4 -62.5 PAT was lower due to lower than estimated EBITDA marginsEPS (Diluted) 2.5 7.8 -5.2 -148.1 6.7 -62.5Key MetricsJLR sales ( mn GBP) 5953 5959 4831 23.2 6594 -9.7JLR margins (%) 10.3 13.5 12.2 -186 bps 13.7 -336 bps The reported JLR margins was impacted by a charge of £ 58 million for
revaluation of current assets/liabilities & £ 150 million towards one-time provision for new customer loyalty programme. Adjusting for the one-time loyalty programme, EBITDA margins were at 12.9%
JLR PAT (mn GBP) 244 341 -92 -365.2 472 -48.3 PAT was lower due to lower than estimated JLR marginsDomestic revenues (| crore) 10322.5 10964.9 10693.7 -3.5 10319.6 0.0 Miss on estimates was due to lower than estimated ASPDomestic margins (%) 3.6 6.0 7.3 -366 bps 6.7 -305 bps Below estimates on account of gross margin contraction due to poor product mix
Domestic PAT (| crore) -630.8 99.5 -288.8 -118.4 25.7 -2,549.6 PAT came in below estimates due to lower than estimated margins
Source: Company, ICICIdirect.com Research Change in estimates
(| Crore) Old New % Change Old New % Change CommentsRevenue 311,759 289,535 -7.1 380,161 348,128 -8.4EBITDA 49,298 39,479 -19.9 60,747 55,575 -8.5EBITDA Margin (%) 15.8 13.6 -216 bps 16.0 16.0 -2 bps Operating margin estimates of JLR reduced post H1FY17 performance. Even
standalone stimates reduced as Q3FY17 will be a subdued quarterPAT 19,550 12,060 -38.3 23,001 20,827 -9.5EPS (|) 57.6 35.5 -38.3 67.7 61.3 -9.4 EPS reduced due to the decline in revenue & margin estimate
FY17E FY18E
Source: Company, ICICIdirect.com Research Assumptions
CommentsUnits FY14 FY15E FY16E FY17E FY18EJaguar Land Rover 429,861 466,479 544,085 590,174 679,471 Almost maintained the volume estimatesJaguar 79,307 76,496 102,106 166,499 204,984Land Rover 350,554 389,983 441,979 423,675 474,487China JV N.A. 683 34,751 70,485 86,569Avg ASP/vehicle (£) 45,117.7 46,847.4 41,025.8 40,646.4 43,728.9RM/Unit (GBP) 27758 28265 24162 25015 26083Capitalised expenses (mn £) 1,030 1,158 1,242 1,508 1,674IndiaM&HCV 121,937 142,490 176,493 184,504 212,179 Although FY18 growth will remain intact, FY17 growth will be adversely impacted due to high
base and recent demonetisation impactLCV 299,252 222,272 204,741 227,849 261,359 LCV volumes will grow due to overall recovery in that segmentPV 145,428 137,574 130,478 174,461 217,716 New launches will spur growth
Source: Company, ICICIdirect.com Research
ICICI Securities Ltd | Retail Equity Research Page 3
Company Analysis Revenues to remain upbeat as JLR grows! We expect consolidated revenues to grow at ~12.4% CAGR in FY16-18E to ~| 348128 crore driven by JLR’s revenue CAGR of ~15.7% in the same period at ~£29.7 billion (~ | 2,66,653 crore). On the India side, we expect revenues to rise at 18.8% CAGR to ~| 59,809 crore by FY18E. Exhibit 1: We build revenue growth at 12.4% CAGR in FY16-16E
165,655188,818
232,861263,159 275,561 289,535
348,128
0
50000
100000
150000
200000
250000
300000
350000
400000
FY12 FY13 FY14 FY15E FY16E FY17E FY18E
CAGR 12% FY16-18E
Source: Company, ICICIdirect.com Research
JLR product story to continue in coming years! The management has lowered its initial capex of £3.75 billion for FY17E. It is towards new products, technology & expansion of manufacturing capacity. The management expects capex to remain in the range of 15-17% of sales in the medium term on significant investments in platform development. Thus, we believe the roadmap for new product launches (Evoque 2016 MY, XJ 2016MY, new XF, F-PACE) and refreshes over the next four years looks clear. We expect the China JV to ramp up through FY17E, FY18E. Exhibit 2: JLR volumes trend
ICICI Securities Ltd | Retail Equity Research Page 4
Exhibit 3: Jaguar market mix movement
Q2FY17
UK23%
N America26%China
16%
Europe22%
ROW13%
Q2FY16
UK36%
N America16%
China11%
Europe23%
ROW14%
Source: Company press release, ICICIdirect.com Research Retail sale volumes referred
Exhibit 4: Land Rover market mix movement
Q2FY17
UK21%
N America20%
China22%
Europe21%
ROW16%
Q2FY16
ROW18%
Europe27%
China19%
N America18%
UK18%
Source: Company press release, ICICIdirect.com Research Retail sale volumes referred
Exhibit 5: Product & geography mix
74.787.0
12.0
6.60.30.013.0 6.3
0
20
40
60
80
100
Q2FY16 Q2FY17
(%)
XF/XE XJ XK/F-Pace F-Type
6.4 0.4
32.4 41.2
0.0 0.0
17.012.4
22.225.9
22.0 20.1
0
20
40
60
80
100
Q2FY16 Q2FY17
(%)
Defender Discovery Freelander Evoque Range Rover RRSport
Source: Company press release, ICICIdirect.com Research retail volumes referred RR ~ Range Rover
ICICI Securities Ltd | Retail Equity Research Page 5
EBITDA margins to trend higher Tata Motors remains a unique case that in India has a combination of high leverage CV business along with a financial dragger on the PV side. On the other hand, on the global front with JLR, it has been one of the most profitable luxury carmakers in the world. The variation is mind boggling in itself with the number of levers towards EBITDA ranging from financial leverage to operating leverage to FX to product mix as well as market mix. Thus, in a nutshell, it remains a company that can have large variations from analyst estimates on a quarterly basis. The China JV reported a strong financial performance despite being in a ramp up phase. The China JV’s contribution towards FY16 PAT was £64 million. With such profitability and operating leverage kicking in once the ramp up happens, the margin is likely to trend upwards. Thus, we expect JLR’s EBITDA margins to increase to 15.9% for FY18E. In the domestic business, we expect operational positivity to emerge (7.9% in FY18E).
Exhibit 7: Margins trend on standalone and JLR
9.9
8.1
6.5 6.2
7.9
4.8
-1.4-2.2
17.5 18.9
14.213.1
15.2
15.0
14.8
15.9
-4
-2
0
2
4
6
8
10
12
FY11 FY12 FY13 FY14 FY15E FY16E FY17E FY18E
(%)
0
2
4
6
8
10
12
14
16
18
20(%
)
EBITDA margins (Standalone) EBITDA margins (JLR)
Source: Company, ICICIdirect.com Research
Exhibit 6: Consolidated EBITDA margins to decline 26
,569 37
,368
42,1
14
41,8
51 55,5
75
39,4
79
14.1
16.0 16.0
15.2
16.0
13.6
0
10000
20000
30000
40000
50000
60000
FY13 FY14 FY15E FY16E FY17E FY18E
(| c
rore
)
12
13
13
14
14
15
15
16
16
17
(%)
Source: Company, ICICIdirect.com Research
ICICI Securities Ltd | Retail Equity Research Page 6
Return ratios to increase to reflect rising margins Return ratios witnessed a decline since FY12 primarily due to the significant investment in both JLR and domestic business, the latter of which failed badly in generating strong returns. Going ahead, we expect high JLR margins to positively impact return ratios. Return ratios in FY16E appear lower on account of the recent rights issue, which led to an equity dilution of ~5%. At the consolidated level, we expect PAT to grow at 28% CAGR to | 20,827 crore in FY18E. Exhibit 8: Returns ratios trend
21.721.3
22.8
17.0
12.9
18.3
24.9
15.3
11.7
16.8
10
15
20
25
30
FY14 FY15E FY16E FY17E FY18E
(%)
RoCE RoE
Source: Company, ICICIdirect.com Research
Exhibit 9: Trend in net profit
9,86
1 13,9
44
13,9
86
12,6
38
12,0
60
20,8
27
0
5000
10000
15000
20000
25000
FY13 FY14 FY15E FY16E FY17E FY18E
(| c
rore
)
Source: Company press release, ICICIdirect.com Research
ICICI Securities Ltd | Retail Equity Research Page 7
Outlook and valuation Tata Motors’ business has been increasingly polarised towards the global business of JLR. We believe that with JLR’s strong product line-up and planned product refreshes, the market share march is likely to continue. We remain positive on sustained earnings growth for the JLR business as the product pipeline grows and market share increases across geographies. We value the stock on an SOTP basis, with JLR on 4x EV/EBIDTA basis contributing ~| 520/share (exc. JV) while the domestic business contributes | 52/share. Inclusive of other subsidiaries, we arrive at a target price of | 595. Exhibit 10: Valuation on SOTP method
Price Idirect target Consensus Target Mean % Consensus with BUY
Source: Bloomberg, Company, ICICIdirect.com Research Key events Date EventJan-08 Much touted "Nano" is unveiled at Auto Expo along with new 1 tonne LCV's "ACE". Jun-08 Acquisition of Jaguar & Land Rover for $2.3 billionJan-09 Tata Motors posts losses as domestic economy sales weaken and global foray causes dragJul-09 Tata Motors' Q1FY10 results rise 58% YoY beat estimates ,early signs of recovery of economy. Nano dispathces rise to 9,000 unitsMay-10 JLR turns profitable for Tata Motors with FY10 PAT of £32 million, big earnings beatDec-10 Nano sales fall 85% to 509 units on unavailability of vehicle financing options amid fire incidents Jun-11 JLR announces £1.5 billion capex spends, Tatat Motors CDS rises as European region problems flare upOct-11 JLR launches its path breaking mini-SUV "Evoque"Aug-12 Karl Slym becomes MD of Tata Motor's domestic businessJan-12 JLR reports highest rise in sales since June 2010 on the back of "Evoque"May-12 JLR reports tax credits to boost profit amid weaker than estiimated JLR marginsOct-12 Siam cuts India auto sales forecast second time in a yearAug-13 JLR reports stronger than estimated margins in Q1FY14 even as domestic business struggles in lossesFeb-14 JLR outlines timelines for new engine plant, new launches, China JV
Source: Company, ICICIdirect.com Research Top 10 Shareholders Shareholding Pattern Rank Name Latest Filing Date % O/S Position (m) Change (m)1 Tata Group of Companies 30-Sep-16 0.32 936.8 0.002 Ewart Investment, Ltd. 20-Sep-16 0.2698 779.0 778.973 Life Insurance Corporation of India 30-Sep-16 0.052 150.1 -55.654 GIC Private Limited 30-Sep-16 0.0165 47.6 -7.155 ICICI Prudential Life Insurance Company Ltd. 30-Sep-16 0.0156 45.1 -4.426 BlackRock Institutional Trust Company, N.A. 31-Oct-16 0.0145 41.9 0.327 Invest AD 30-Sep-16 0.0139 40.0 0.888 The Vanguard Group, Inc. 30-Sep-16 0.0098 28.3 -0.369 Dimensional Fund Advisors, L.P. 30-Sep-16 0.0084 24.1 0.0110 Norges Bank Investment Management (NBIM) 31-Dec-15 0.008 23.0 16.73
ICICI Securities Ltd | Retail Equity Research Page 11
RATING RATIONALE ICICIdirect.com endeavours to provide objective opinions and recommendations. ICICIdirect.com assigns ratings to its stocks according to their notional target price vs. current market price and then categorises them as Strong Buy, Buy, Hold and Sell. The performance horizon is two years unless specified and the notional target price is defined as the analysts' valuation for a stock. Strong Buy: >15%/20% for large caps/midcaps, respectively, with high conviction; Buy: >10%/15% for large caps/midcaps, respectively; Hold: Up to +/-10%; Sell: -10% or more;
ICICI Securities Ltd | Retail Equity Research Page 12
ANALYST CERTIFICATION We /I, Nishit Zota, MBA & Vidrum Mehta, MBA Research Analyst, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report.
Terms & conditions and other disclosures: ICICI Securities Limited is a Sebi registered Research Analyst having registration no. INH000000990. ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stock brokering and distribution of financial products. ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India’s largest private sector bank and has its various subsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, etc. (“associates”), the details in respect of which are available on www.icicibank.com. ICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India. We and our associates might have investment banking and other business relationship with a significant percentage of companies covered by our Investment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts and their relatives from maintaining a financial interest in the securities or derivatives of any companies that the analysts cover. The information and opinions in this report have been prepared by ICICI Securities and are subject to change without any notice. The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ICICI Securities. While we would endeavour to update the information herein on a reasonable basis, ICICI Securities is under no obligation to update or keep the information current. Also, there may be regulatory, compliance or other reasons that may prevent ICICI Securities from doing so. Non-rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicable regulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this company, or in certain other circumstances. This report is based on information obtained from public sources and sources believed to be reliable, but no independent verification has been made nor is its accuracy or completeness guaranteed. This report and information herein is solely for informational purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. ICICI Securities will not treat recipients as customers by virtue of their receiving this report. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. The recipient should independently evaluate the investment risks. The value and return on investment may vary because of changes in interest rates, foreign exchange rates or any other reason. ICICI Securities accepts no liabilities whatsoever for any loss or damage of any kind arising out of the use of this report. Past performance is not necessarily a guide to future performance. Investors are advised to see Risk Disclosure Document to understand the risks associated before investing in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are not predictions and may be subject to change without notice. ICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have been mandated by the subject company for any other assignment in the past twelve months. ICICI Securities or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from the date of this report for services in respect of managing or co-managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction. ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the companies mentioned in the report in the past twelve months. ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts have any material conflict of interest at the time of publication of this report. It is confirmed that Nishit Zota, MBA & Vidrum Mehta, MBA, Research Analyst of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months. Compensation of our Research Analyst is not based on any specific merchant banking, investment banking or brokerage service transactions. ICICI Securities or its subsidiaries collectively or Research Analysts do not own 1% or more of the equity securities of the Company mentioned in the report as of the last day of the month preceding the publication of the research report. Since associates of ICICI Securities are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject company/companies mentioned in this report. It is confirmed that Nishit Zota, MBA & Vidrum Mehta, MBA, Research Analyst do not serve as an officer, director or employee of the companies mentioned in the report. ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report. Neither the Research Analyst nor ICICI Securities have been engaged in market making activity for the companies mentioned in the report. We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysis activities. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction.