Apollo Hospitals (APOHOS) 1280

Transcription

1 Result Update Rating matrix Rating : Hold Target : 134 Target Period : 12 months Potential Upside : 5% What s Changed? Target Changed from 14 to 134 EPS FY16E Changed from 3.9 to 28.9 EPS FY17E Changed from 41. to 35. EPS FY18E Introducing at 47.2 Rating Unchanged Standalone Quarterly Performance Q2FY16 Q2FY15 YoY (%) Q1FY16 QoQ (%) Revenue 1, , , EBITDA EBITDA (%) bps bps Net Profit Key Financials ( Crore) FY15 FY16E FY17E FY18E Revenues EBITDA Adjusted PAT Adj. EPS ( ) Valuation summary FY15 FY16E FY17E FY18E PE (x) EV to EBITDA (x) Target EV/EBITDA (x) Price to book (x) RoNW (%) RoCE (%) Stock data Particular Amount Market Capitalisation crore Debt (FY15) 1992 crore Cash (FY15) 377 crore EV crore 52 week H/L 1516/17 Equity capital 69.6 Face value 5 Price performance (%) 1M 3M 6M 1Y Apollo Hospitals Fortis Healthcare Research Analyst Siddhant Khandekar siddhant.khandekar@icicisecurities.com Mitesh Shah mitesh.sha@icicisecurities.com Nandan Kamat nandan.kamat@icicisecurities.com November 18, 215 Apollo Hospitals (APOHOS) 128 Margin improvement - work in progress Revenue increased 18.6% YoY to crore (I-direct estimate: crore) on the back of 33.4% YoY increase in pharmacy business to crore (I-direct estimate: crore) and 9.6% YoY increase in healthcare business to crore (I-direct estimate: crore) EBITDA margins declined 84 bps to 14.1% (I-direct estimate: 14.6%) on the back of lower gross profit margins due to higher contribution from low margin pharmacy business. GPM declined 77 bps YoY to 46.4%. EBITDA increased 11.9% YoY to crore (I-direct estimate of crore) Net profit grew 2.4% to 93.7 crore (I-direct estimate: 96.4 crore) Healthcare business growth to piggyback on sustained expansions The healthcare services segment (54% of consolidated revenues) has grown at a CAGR of 14% in FY11-15 on account of incremental hospital addition in all the three clusters i.e. Chennai, Hyderabad and others. Rapid expansion and maturity of older hospitals has kept the overall growth tempo of ~14% per annum. The next phase of expansion includes addition of 135 beds to the existing network of 4 hospitals and 7123 beds (own hospitals) by FY19 with an additional capex of 1555 crore. This is likely to put some pressure on EBITDA margins in the short to medium term. However, in the past, the company has demonstrated its ability to balance between expansion and margins. By acquiring Nova speciality and Assam Hospitals, the company has also adopted the inorganic route for expansion. We expect more focus in improvement of important parameters such as average length of stay (ALOS) and average revenue per operating bed (AROPB), which are flat in the last few quarters on account of incremental bed additions. We expect healthcare sales to grow at a CAGR of 13.8% in FY15-18E to crore as the company keeps on investing in the new assets. Pharmacy business EBITDA positive; candidate for value unlocking The pharmacy business (34% of consolidated revenues) has grown at a CAGR of ~28% over the last four years on the back of consistent addition of new pharmacies and timely closure of non-performing pharmacies. This business has become EBITDA positive as old stores are maturing and making contribution. We expect the pharmacy business to grow at a CAGR of 21.9% in FY15-18E to crore on the back of higher sales from existing stores. The company has added 46 stores in Q2FY16 taking total stores to In the last three years, we have seen strong improvement in revenues per store from 15 lakh in FY11 to 27 lakh in FY15. The Hetero acquisition may put some pressure on margins initially but augurs well in the long run for scalability. Profitability of new hospitals key for overall margin improvement We expect consolidated sales, EBITDA and PAT to grow at a CAGR of 16.6%, 21.% and 24.5%, respectively, during FY15-18E. The newly commissioned hospitals have achieved the BE level fairly ahead of our expectations. The focus will now shift to operational gauges for different cluster hospitals as the current phase of capex cycle nears the end. The Nova and Assam acquisition has demonstrated Apollo s willingness to opt for the inorganic route for expansion through localised targets with good capability. On the other hand, pharmacy margins, which showed improvement recently, may take some hit in the medium-term on the back of Hetero stores acquisition. Our revised target price is 134 as per SOTP valuation. ICICI Securities Ltd Retail Equity Research

2 Variance analysis Q2FY16 Q2FY16E Q2FY15 Q1FY16 YoY (%) QoQ (%) Comments Revenue 1, ,33.3 1, , Growth driven by ~33% growth in pharmacy segment Raw Material Expenses Employee Expenses Other expenditure EBITDA EBITDA (%) bps -47 bps The decline in margins was mainly due to higher growth in the low margin pharmacy business and lower margins fetched by newly commissioned hospitals. The pharmacy business margins were ~3.7% while healthcare services margins were ~22% Interest Higher financial cost was mainly due to higher leverage for new facilities commissioned in Q4FY15 Depreciation Other Income PBT before EO & Forex EO PBT after Exceptional Items Tax Tax rate (%) Net Profit Muted YoY growth was due to lower EBITDA and higher financial cost EPS ( ) Key Metrics Healthcare Services Growth mainly driven by new hospital additions Pharmacy Growth driven by integration of Hetero pharmacy, 46 net stores addition and traction from mature stores Change in estimates FY16E FY17E ( Crore) Old New % Change Old New % Change Comments Revenue 6,261. 6, , , EBITDA , , EBITDA Margin (%) bps bps Reduced margin expectation due to lower-than-expected occupancy across clusters and adverse business mix PAT EPS ( ) Reduced mainly in sync with EBITDA Assumptions Current Earlier (% Growth) FY14 FY15 FY16E FY17E FY16E FY17E Healthcare Services 2, ,82.7 3, ,713. 3, ,7.7 Reduced expectation due to lower-than-expected occupancy across clusters Pharmacy 1, , ,343. 2,81.9 2, ,64.9 Increased mainly due to higher-than-expected addition of new pharmacy stores Subsidiaries & consulting fees JVs ICICI Securities Ltd Retail Equity Research Page 2

3 Company Analysis Established in 1983, the company is one of the few listed players in the healthcare space. It derives revenues from two broader segments in the standalone accounts - 1) healthcare services i.e. hospitals and 2) standalone pharmacies. In the consolidated accounts, other reporting segments are 1) hospital revenues from JVs/subsidiaries and associates, 2) Apollo-Munich Health insurance JV, 3) ApolloHealth & Lifestyle Ltd, which is the retail healthcare business of Apollo Hospitals. Apollo owns 64 hospitals with a total bed capacity of 8985 beds. Of these 64 hospitals, 4 are owned by the company (including JVs, subsidiaries and associates). Eight are managed by the company with 1434 beds while 16 are day care/short surgical stay centres and cradles with 428 beds. This business has been categorised as the healthcare business and comprises ~61% of standalone revenues. In case of managed hospitals, the company charges 5-6% management fees to third party hospitals for project management and consultancy covering all facets of development and operation of a hospital, including market research, technical design, arranging finance, hiring manpower and running the facility. The healthcare segment has been divided into three clusters- 1) Chennai, 2) Hyderabad, and 3) Others, which include hospitals located in Madurai, Karur, Karaikudi, Trichy, Mysore, Vizag, Pune, Karimnagar, Bilaspur, Bhubaneswar and Jayanagar. In case of standalone pharmacies, which is basically drug stores chain selling prescription, OTC and private label FMCG products, the company owns 2217 stores. Overall we expect revenues to grow at a CAGR of 16.6% in FY15-18E to 82.4 crore. Exhibit 1: Revenues to grow at CAGR of 16.6% in FY15-18E Revenues The healthcare services segment (54% of consolidated revenues) has grown at a CAGR of 14% in FY11-15 on account of incremental hospital addition in all the three clusters i.e. Chennai, Hyderabad and Others. Rapid expansion and maturity of older hospitals has kept the overall growth tempo of ~14% per annum. The next phase of expansion includes addition of 135 beds to the existing network of 4 hospitals and 7123 beds (own hospitals) by FY19 with an additional capex of 1555 ICICI Securities Ltd Retail Equity Research Page 3

4 crore. This is likely to put some pressure on the EBITDA margins in the short to medium term. However, in the past, the company has demonstrated its ability to balance between expansion and margins. By acquiring Nova speciality and Assam hospitals the company has also adopted for inorganic route for expansion. We expect more focus in improvement of important parameters such as average length of stay (ALOS) and average revenue per operating bed (AROPB), which are flat in the last few quarters on account of incremental bed additions. We expect healthcare sales to grow at a CAGR of 13.8% in FY15-18E to crore as the company keeps on investing in new assets. Exhibit 2: Healthcare services to grow at CAGR of 13.8% in FY15-18E Healthcare Services The pharmacy business (34% of consolidated revenues) has grown at a CAGR of ~28% over the last five years on the back of consistent addition of new pharmacies and timely closure of non-performing pharmacies. This business has become EBITDA positive as more and more old stores are maturing and making contribution. We expect the pharmacy business to grow at a CAGR of 21.9% in FY15-18E to crore on the back of higher sales from existing stores. The company has added 46 stores in Q2FY16 taking total stores to In the last three years we have seen strong improvement in revenues per store from 15 lakh in FY11 to 27 lakh in FY15. The pharmacy business is also a candidate possible value unlocking. Exhibit 3: Pharmacy business to grow at CAGR of 21.9% in FY15-18E Pharmacy ICICI Securities Ltd Retail Equity Research Page 4

5 Exhibit 4: Subsidiaries & others to grow at CAGR of 11.2% in FY15-18E Subsidiaries & consulting fees Source: Company, ICICIdirect.com, Research Exhibit 5: JVs sales to grow at CAGR of 14.5% in FY15-18E Add JV Source: Company, ICICIdirect.com, Research Exhibit 6: EBITDA to grow at CAGR of 21% in FY15-18E (%) 2 EBITDA EBITDA Margins (%) 12 Exhibit 7: Net profit to grow at CAGR of 24.5% in FY15-18E (%) 1 Net Profit Net Profit Margins (%) ICICI Securities Ltd Retail Equity Research Page 5

6 Exhibit 8: Trends in return ratios (%) RoCE (%) RoNW (%) ICICI Securities Ltd Retail Equity Research Page 6

7 Exhibit 9: Trends in Standalone quarterly financials Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 YoY (%) QoQ (%) Total Operating Income Raw Material Expenses as % revenues Gross Profit GPM (%) Employee Expenses as % revenues Marketing Expenses as % revenues Other expenditure as % revenues Total expenditure EBITDA EBITDA Margins (%) bps -19 bps Depreciation Interest Other Income PBT Less: Exceptional Items Total Tax Tax rate (%) Net Profit Net Profit Margin (%) EPS (Adjusted) Exhibit 1: Standalone healthcare service performance ( Crore) Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 YoY (%) QoQ (%) Sales EBITDA EBITDA Margins (%) Exhibit 11: Standalone pharmacy performance Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 YoY (%) QoQ (%) Sales EBITDA EBITDA Margins (%) No of Stores Rev per store ( lakh) SWOT Analysis Strengths - Early mover in the healthcare space. Strong balance sheet despite being in a business of higher gestation period. Strong brand value- a significant aspect in this business Weakness - Presence in the low margin Pharmacy space Opportunities - Under-penetrated Indian healthcare space with favourable demographics and disease pattern Threats - Too much capacity built-up may lead to lower capacity utilisation and the cost associated with it. ICICI Securities Ltd Retail Equity Research Page 7

8 Conference call Highlights The company plans to add 895 new beds in North Bangalore (18), Navi Mumbai (4), Indore (65) and Vizag (25) by the end of FY16 It plans to add another 475 beds in FY19 - South Chennai 175, South Mumbai 3 The company expects growth in EBITDA margins to slow down on account of new hospitals Hospital in Byculla is expected to commence in FY19 Net pharmacy store addition in H1FY16 was 91 stores taking the total number of stores to 2217 Hetero integration was completed in September 215. Revenues from Hetero business were low during the quarter with negative 3% EBITDA margins The company plans to add 2 stores every year for the next two to three years Estimated capex for healthcare expansion is ~ 1555 crore, of which it has already spent 724 crore. The balance amount may be funded through a mix of internal accruals and the proposed rights Issue. Majority of the capex would be done in FY16 The company expects capital requirement of 3 crore for AHLL in FY16. It is also planning a capex of 4 crore for the next round of expansion, which will be utilised for the next two or three years ICICI Securities Ltd Retail Equity Research Page 8

9 Valuation We expect consolidated sales, EBITDA and PAT to grow at a CAGR of 16.6%, 21.% and 24.5%, respectively, during FY15-18E. The newly commissioned hospitals have achieved the BE level fairly ahead of our expectations. Focus will now shift to the operational gauges for different cluster hospitals as the current phase of capex cycle nears to the end. The Nova and Assam acquisition has demonstrated Apollo s willingness to opt for inorganic route for expansion through localised targets with good capability. On the other hand, the pharmacy margins that showed an improvement recently may take some hit in the medium term on the back of Hetero stores acquisition. Our revised target price is 134 as per SOTP valuation. Exhibit 12: One year forward EV/EBITDA Mar-6 Sep-6 Mar-7 Sep-7 Mar-8 Sep-8 Mar-9 Sep-9 Mar-1 Sep-1 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 [ EV 2.1x 19.3x 17.8x 15.6x 14.1x Exhibit 13: Valuation Particulers Valuation Matrix Multiple (x) cr) Healthcare EV/EBITDA ,447 Pharmacy EV/Sales 1.2 3,85 Others EV/Sales Cash 348 Expected Debt ( cr) 1,792 EV 18,587 No of shares (cr) 13.9 Per Share Value 1,34 Exhibit 14: Valuation Revenues Growth EPS Growth P/E EV/EBITDA RoNW RoCE (%) ( ) (%) (x) (X) (%) (%) FY FY16E FY17E FY18E ICICI Securities Ltd Retail Equity Research Page 9

10 Company snapshot 1,8 1,6 1,4 Target Price: 134 1,2 1, Jan-9 Apr-9 Jul-9 Oct-9 Jan-1 Apr-1 Jul-1 Oct-1 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Source: Bloomberg, Company, ICICIdirect.com Research Key events Date Sep-8 Jun-9 Event Opens first reach hospital at Karimnagar, Andhra Pradesh Issues 15 unsecured foreign currency convertible bonds of US$1 each to International Finance Corporation aggregating to US$15 million. IFC also granted a loan May-11 Pharmacy business of company turns profitable for first time Sep-12 Government allows foreign direct investment in multi brand retail. Pharmacy business of Apollo Hospitals falls into this category Dec-12 Sells stake in its BPO company Apollo Health Street to US based company Sutherland Global Services. It holds 39.4% in Apollo Health Street Jan-13 Plans to establish a proton therapy centre in India. It will be first of its kind across South East Asia, Africa and Australia. May-13 Apollo Hospitals and Yash Birla Group call off their JV & shut down their plans to set up super specialty hospitals in Thane, Mumbai Sep-14 Enters into agreement to acquire 32 pharmacy stores from Hetero for 146 crore Jan-15 Acquires Bengaluru-based Nova Specialty Hospitals at an estimated cost of crore Top 1 Shareholders Rank Name Latest Filing Date % O/S Position (m) Position Chan 1 PCR Investments, Ltd. 3-Jun Integrated Mauritius Healthcare Holdings, Ltd. 3-Jun OppenheimerFunds, Inc. 3-Jun Reddy (Prathap C) 3-Jun Fidelity Management & Research Company 3-Sep Newton Investment Management Ltd. 3-Jun Reddy (Suneeta) 3-Jun Schroder Investment Management (Hong Kong) Ltd. 31-Jul Schroder Investment Management Ltd. (SIM) 3-Jun Reddy (Sangita) 3-Jun Source: Reuters, ICICIdirect.com Research Shareholding Pattern (in %) Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Promoter FII DII Others Recent Activity Buys Sells Investor name Value Shares Investor name Value Shares Newton Investment Management Ltd m 3.59m William Blair & Company, L.L.C m -1.1m WILLIAM BLAIR INVESTMENT MANAGEMENT, LLC 21.9m 1.m Life Insurance Corporation of India m -.66m Mirae Asset Global Investments (Hong Kong) Limited 14.23m.69m Fidelity Management & Research Company -5.98m -.27m OppenheimerFunds, Inc. 8.43m.41m Edmond de Rothschild Asset Management -3.9m -.21m British Columbia Investment Management Corp. 8.13m.37m Van Eck Associates Corporation -2.73m -.15m Source: Reuters, ICICIdirect.com Research ICICI Securities Ltd Retail Equity Research Page 1

11 Financial summary Profit and loss statement Crore (Year-end March) FY15 FY16E FY17E FY18E Revenues 5, , , ,2.4 Growth (%) Raw Material Expenses 2, , ,823. 4,284. Employee Expenses ,13.8 1,23.1 Marketing Expenses Other expenditure ,99.3 1,385.8 Total Operating Expenditure 4, , ,16.3 6,899.8 EBITDA ,88.4 1,3.6 Growth (%) Depreciation Interest Other Income PBT Total Tax MI & Profit from Associates Adjusted PAT Growth (%) EPS (Adjusted) Cash flow statement Crore (Year-end March) FY15 FY16E FY17E FY18E Profit/(Loss) after taxation Add: Depreciation & Amortization Working Capital Changes CF from operating activities Change in Capex (Inc)/dec in Investments Others CF from investing activities Issue of Equity.... Inc/(dec) in loan funds Dividend paid & dividend tax Others CF from financing activities Net Cash flow Opening Cash Closing Cash Free Cash Flow Balance sheet Crore (Year-end March) FY15 FY16E FY17E FY18E Equity Capital Reserve and Surplus 3,1.6 3,41.6 3,89.7 4,374.6 Total Shareholders funds 3,17.2 3,48.1 3, ,444.2 Total Debt 1, , , ,792.3 Deferred Tax Liability Minority Interest Long term provisions Other Non Current Liabilities Total Liabilities 5, ,8.2 6, ,868.9 Gross Block - Fixed Assets 4,43.5 4, , ,943.5 Accumulated Depreciation 1,1.7 1, ,51.5 1,778.2 Net Block 3,32.8 3,55.7 3,933. 4,165.3 Capital WIP Net Intangible assets Goodwill on Consolidation Total Fixed Assets 3, , , ,779.2 Investments Inventory Debtors ,8.1 Loans & Advances, & other CA Cash Total Current Assets 1, , ,89.3 2,42.9 Creditors Provisions & Other CL Total Current Liabilities ,7. 1,15.7 Net Current Assets ,82.3 1,315.2 Long term loans & advances Deferred Tax Assets Application of Funds 5, ,8.2 6, ,868.9 Key ratios (Year-end March) FY15 FY16E FY17E FY18E Per share data ( ) Adjusted EPS Cash EPS BV per share Dividend per share Cash Per Share Revenue per Share Operating Ratios (%) Gross Profit Margins EBITDA margins Net Profit margins Inventory days Debtor days Creditor days EBITDA Conversion Rate Return Ratios (%) RoE RoCE RoIC Valuation Ratios (x) P/E EV / EBITDA EV / Net Sales Market Cap / Sales Price to Book Value Solvency Ratios Debt / EBITDA Debt / Equity Current Ratio ICICI Securities Ltd Retail Equity Research Page 11

12 ICICIdirect.com coverage universe (Healthcare) Code ( ) ( ) ( Cr) FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E Ajanta Pharma AJAPHA Buy Apollo Hospitals APOHOS Hold Aurobindo Pharma AURPHA Buy Alembic Pharma ALEMPHA Buy Biocon BIOCON Hold Cadila Healthcare CADHEA Buy Cipla CIPLA Buy Divi's Laboratories DIVLAB Hold Dr Reddy's Labs DRREDD Buy Glenmark Pharma GLEPHA Buy Indoco Remedies INDREM 3 4 Buy Ipca Laboratories IPCLAB Hold Jubilant Life Sciences VAMORG Hold NA Lupin LUPIN Buy Natco Pharma NATPHA Hold Sun Pharma SUNPHA Hold Torrent Pharma TORPHA Buy Unichem Laboratories UNILAB Buy ICICI Securities Ltd Retail Equity Research Page 12

13 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%/2% for large caps/midcaps, respectively, with high conviction; Buy: >1%/15% for large caps/midcaps, respectively; Hold: Up to +/-1%; Sell: -1% or more; Pankaj Pandey Head Research pankaj.pandey@icicisecurities.com ICICIdirect.com Research Desk, ICICI Securities Limited, 1st Floor, Akruti Trade Centre, Road No 7, MIDC, Andheri (East) Mumbai 4 93 research@icicidirect.com ICICI Securities Ltd Retail Equity Research Page 13

14 ANALYST CERTIFICATION We /I, Siddhant Khandekar, CA INTER and Mitesh Shah, MS (finance), Nandan Kamat MBA Research Analysts, 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. INH99. 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 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 Siddhant Khandekar, CA INTER and Mitesh Shah, MS (finance), Nandan Kamat MBA, Research Analysts of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months. Compensation of our Research Analysts 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 Siddhant Khandekar, CA INTER and Mitesh Shah, MS (finance), Nandan Kamat MBA, Research Analysts 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 Analysts 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. ICICI Securities Ltd Retail Equity Research Page 14