Castrol India. CMP: INR407 TP: INR474 (+16%) Neutral

Transcription

1 BSE SENSEX S&P CNX 23,089 7,019 Bloomberg CSTRL IN Equity Shares (m) M.Cap. (INR b) / (USD b) 201/ Week Range (INR) 518 / 370 1, 6, 12 Rel. Per (%) 3/3/6 Avg Val (INR m) 128 Free float (%) 29.0 Financials & Valuation (INR Billion) Y/E Dec E 2017E Sales EBITDA Adj. PAT Adj. EPS (INR) EPS Gr. (%) BV/Sh.(INR) RoE (%) RoCE (%) P/E (x) P/BV (x) Estimate change 4-7% TP change 7% Rating change 24 February QCY15 Results Update Sector: Lubricants Castrol India CMP: INR407 TP: INR474 (+16%) Neutral EBITDA miss due to lower volumes and higher other expenses; await volume growth revival Castrol India s 4QCY15 EBITDA of INR2.1b (+3% YoY, -2% QoQ) was below our est. of INR2.4b led by (a) lower than-expected volumes; (b) higher other operating expenses due to INR100m of CSR expenses. Reported PAT was below expectations at INR1.4b (+7% YoY, -2% QoQ) led by higher than expected tax rate of 37.4% (est. of 34%). Revenue stood at INR7.9b (est. of INR8.6b; -7.9% YoY, -0.9% QoQ) impacted by (a) lower volumes and (b) lower realizations Realization stood at INR171/ltr (-4% YoY, flat QoQ) while sales volume stood at 46.1m ltr (-4% YoY, +2% QoQ). QoQ volume increase was primarily due to seasonality. Automotive volumes increased 2% QoQ. While overall automotive market has declined, personal mobility market volumes have increased. Poor monsoons have impacted rural demand and in particular in agriculture segment. Gross margin INR90/lt (+15% YoY, +2% QoQ); the QoQ increase was due to lower RM costs at INR80.8/ltr (-18% YoY, -4% QoQ). EBITDA margin 26.6% (v/s 23.8% in 4QCY14 and 27.2% in 3QCY15) EBITDA margin was lower QoQ despite higher gross margins due to CSR expenses of INR100m. Adj. EBITDA margin stands at 27.8%. Castrol declared a final dividend of INR5/share (full year stands at INR9/share). Outlook: Lubricant business volume recovery continues to be delayed led by subdued economic activity. Industrial segment will continue to see a drag and is expected to show uptick with the likely economic pick-up toward end CY16. INR/USD volatility is a concern. Expect volume uptick in 1QCY16 due to increased discounts being offered by the company. Valuation and view: We reduce our earnings CY16/CY17 EPS by 7%/4% due to delay in the volume uptick versus our earlier expectations. Earlier than expected economic uptick is an upside risk to our estimates. Our fair value stands at INR474 at 35x CY16E EPS. CSTRL trades at 30.2x/27.6 CY16E/CY17E EPS of INR13.5/14.8. Neutral. Harshad Borawake (HarshadBorawake@MotilalOswal.com); Rajat Agarwal (Rajat.Agarwal@MotilalOswal.com); Investors are advised to refer through important disclosures made at the last page of the Research Report. Motilal Oswal research is available on Bloomberg, Thomson Reuters, Factset and S&P Capital.

2 Exhibit 1: Operational performance: QoQ volumes declined due to seasonality while realizations were almost flat INR/ltr CY12 CY13 CY14 CY15 4QCY15 (%) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q YoY QoQ Volumes (m litres) Automotive Non-Automotive Realizations Automotive Non-Automotive Raw material Gross Margin EBITDA Margin Exhibit 2: Segmental snapshot: Automotive profitability declines QoQ CY12 CY13 CY14 CY15 4QCY15 (%) In INRm 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q YoY QoQ Revenues Automotive 6,744 7,515 6,248 6,662 6,968 7,668 6,247 7,033 7,197 8,047 6,907 7,386 7,098 8,215 6,740 6, Non-Automotive 1, , ,090 1,116 1, ,021 1,103 1, Total Segment Revenue -RHS 7,817 8,513 7,195 7,609 7,847 8,620 7,234 8,095 8,170 9,137 8,023 8,593 7,792 9,236 7,843 7, EBIT Automotive 1,461 1,499 1,036 1,562 1,563 1,914 1,297 1,578 1,254 1,628 1,538 1,754 1,950 2,458 1,877 1, Non-Automotive Total 1,704 1,685 1,185 1,670 1,731 2,130 1,487 1,793 1,399 1,814 1,733 2,004 2,123 2,714 2,110 2, Segmental EBIT Margin (%) Automotive Non-Automotive Total Capital Employed Automotive 2,595 2,122 2,046 1,231 2,361 1,631 1,949 2,039 2,504 1,848 2,035 1,405 2,755 1,446 1, Non-Automotive 1,164 1,021 1, ,028 1,052 1,120 1,132 1, ,091 1, Unallocated 3,513 3,325 4,238 4,382 4,380 4,778 5,465 4,485 2,091 1,942 2,866 2,431 2,678 3,500 5,222 4, Total Capital Employed 7,272 6,468 7,326 6,491 7,735 7,233 8,277 7,514 5,623 4,842 6,021 4,968 6,435 5,892 7,324 5, February

3 Exhibit 3: Castrol s volumes have been stagnant for several years led by higher drain intervals and competition (m ltr) Volumes (m litres) Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14 CY15 Exhibit 4: However, company has been able to maintain profitability through consistent price hikes Realizations (INR/ltr) Raw material (INR/ltr) Gross Margin (INR/ltr) Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14 CY15 Valuation and view Lower than expected volume uptick is due to the delay in likely economic recovery in our view. We expect economic revival will lead to better volume growth in personal mobility as well as CV and industrial volumes. Outlook: Lubricant business volume recovery continues to be delayed led by subdued economic activity. Industrial segment will continue to see a drag and is expected to show uptick with the likely economic pick-up toward end CY16. INR/USD volatility is a concern. Expect volume uptick in 1QCY16 due to increased discounts being offered by the company. Valuation and view: We reduce our earnings CY16/CY17 EPS by 7%/4% due to delay in the volume uptick versus our earlier expectations. Earlier than expected economic uptick is an upside risk to our estimates. Our fair value stands at INR474 at 35x CY16E EPS. CSTRL trades at 30.2x/27.6 CY16E/CY17E EPS of INR13.5/14.8. Neutral. 24 February

4 Story in charts Exhibit 5: Castrol s revenue growth declined in recent years Revenue (INRb) 3 Yr CAGR (%) CY02 CY04 CY06 CY08 CY10 CY12 CY14 CY16 Exhibit 6: led by continuous decline in lubricant sales volume (0.3) 0.8 Volumes (m litres) 3 Yr CAGR (%) (0.6) (0.1) (0.1) 0.3 (0.9) (1.8) (2.1) (2.1) (3.3) (3.5) CY01 CY04 CY07 CY10 CY13 CY16 Exhibit 7: but capped by increase in realizations 4.9 Realisations (INR/ltr) 3 Yr CAGR (%) CY01 CY04 CY07 CY10 CY13 CY16 Exhibit 8: Castrol s PAT grew at 10% CAGR in the last 14 years EBITDA (INRb) PAT (INRb) CY02 CY04 CY06 CY08 CY10 CY12 CY14 CY16 Exhibit 9: Though lower than previous highs return ratio s continue to remain healthy RoE (%) RoCE (%) Exhibit 10: Castrol s raw material (base oil) shows strong correlation to crude oil prices as expected Brent (INR/ltr) Raw material (INR/ltr) CY02 CY04 CY06 CY08 CY10 CY12 CY14 CY February

5 Financials and valuations Income Statement (INR Million) Y/E December E 2017E Net Sales 28,020 29,818 31,209 31,661 33,808 32,853 34,338 36,235 Change (%) Raw Material 13,847 16,945 16,894 16,777 18,233 14,917 16,089 17,345 Gross Margin 14,173 12,873 14,314 14,884 15,575 17,936 18,249 18,890 Employee Cost 993 1,078 1,284 1,460 1,616 1,766 1,889 1,993 Selling Admin. & Other Exp. 5,931 5,230 6,859 6,683 6,868 7,349 6,708 6,336 Total Expenditure 20,770 23,253 25,038 24,920 26,717 24,032 24,686 25,673 EBITDA 7,249 6,565 6,171 6,741 7,091 8,821 9,652 10,562 Change (%) % of Net Sales Depreciation EBIT 7,006 6,314 5,905 6,436 6,730 8,431 9,229 10,102 Interest & Finance Charges Other Income Non-recurring Items/ Inc. 1, PBT 7,377 7,140 6,608 7,618 7,303 9,510 10,145 11,080 Tax 2,474 2,334 2,189 2,532 2,524 3,357 3,449 3,767 Effective Rate (%) Reported PAT 4,903 4,807 4,419 5,086 4,779 6,153 6,696 7,313 Adjusted PAT 4,914 4,850 4,474 4,932 4,779 5,951 6,696 7,313 Change (%) Balance Sheet (INR Million) Y/E December E 2017E Sources of Funds Share Capital 2,473 2,473 4,946 4,946 2,473 2,473 2,473 2,473 Reserves 3,062 3,569 1,547 2,568 2,495 3,458 4,387 5,357 Net Worth 5,535 6,042 6,492 7,514 4,968 5,931 6,860 7,830 Capital Employed 5,535 6,042 6,492 7,514 4,968 5,931 6,860 7,830 Gross Fixed Assets 2,955 3,066 3,287 4,084 3,762 4,152 4,587 5,047 Less: Depreciation 1,752 1,941 2,026 2,331 2,041 2,431 2,854 3,314 Net Fixed Assets 1,203 1,125 1,261 1,753 1,721 1,721 1,733 1,733 Capital WIP Investments Curr. Assets 11,628 12,035 12,574 13,867 12,423 13,463 14,895 16,890 Inventory 2,442 3,009 3,158 3,740 3,655 3,023 3,164 3,406 Sundry Debtors 1,784 2,190 2,196 2,372 2,715 2,638 2,758 2,910 Cash & Bank Balances 6,193 5,490 5,746 5,942 4,315 6,112 7,265 8,786 Loans & Adv.& Other Current Assets 1,209 1,347 1,474 1,813 1,739 1,690 1,708 1,787 Current Liab. & Prov. 7,833 7,991 8,303 8,636 9,950 10,071 10,586 11,410 Sundry Creditors 4,949 5,140 4,366 4,728 5,399 4,417 4,680 5,023 Provisions 2,884 2,852 2,668 2,590 3,068 4,096 4,270 4,670 Net Current Assets 3,795 4,044 4,271 5,231 2,473 3,392 4,309 5,479 Deferred Tax Liability Application of Funds 5,535 6,042 6,493 7,514 4,968 5,931 6,860 7,830 E: MOSL Estimates; * Model INR5/sh payout in 2014 led by equity redn 24 February

6 Financials and valuations Ratios (INR Million) Y/E December E 2017E Basic (INR) Adj. EPS Adj Cash EPS Book Value per Share DPS Payout (Incl. Div. Tax) % Valuation (x) P/E Cash P/E EV/EBITDA EV/Sales Price to Book Value Dividend Yield (%) Profitability Ratios (%) RoE RoCE Turnover Ratios Debtors (Days) Inventory (Days) Creditors (Days) Working Capital (Days) Asset Turnover (x) Gross Fixed Asset Turnover (x) Leverage Ratio Debt/Equity (x) Cash Flow Statement (INR Million) Y/E MARCH E 2017E PBT before E.O. Items 7,377 7,140 6,608 7,390 7,303 9,510 10,145 11,080 Add : Depreciation Add: Interest Less : Direct taxes paid 2,474 2,334 2,189 2,532 2,524 3,357 3,449 3,767 Inc/Dec in WC 364 (952) 29 (764) 1, CF from operations 5,535 4,125 4,733 4,416 6,296 7,429 7,363 8,132 CF from Oper. incl. EO Items 5,535 4,125 4,733 4,416 6,296 7,429 7,363 8,132 (Inc)/Dec in FA (238) (318) (402) (487) (486) (433) (435) (260) Free Cash Flow 5,297 3,808 4,331 3,929 5,810 6,996 6,928 7,872 (Pur)/Sale of Investments CF from investments (232) (318) (402) (487) (486) (433) (435) (260) Inc/Dec in Networth , Less: Dividend Paid 4,325 4,311 4,325 4,037 4,325 5,190 5,767 6,343 CF from Fin. Activity (4,367) (4,510) (4,075) (3,732) (7,438) (5,198) (5,775) (6,351) Inc/Dec of Cash 935 (703) ,628 1,798 1,153 1,521 Add: Beginning Balance 5,258 6,193 5,490 5,746 5,942 4,315 6,112 7,265 Closing Balance 6,193 5,490 5,746 5,942 4,314 6,112 7,265 8,786 E: MOSL Estimates 24 February

7 Corporate profile: Castrol India Company description Castrol India (CSTRL), a 71% subsidiary of BP, is a leading lubricants player in India, with ~20% market share of the domestic automotive lubricants industry. It manufactures and markets a range of automotive and industrial lubricants. It markets its automotive lubricants under two brands - Castrol and BP. The company enjoys leadership in most of the segments it operates in, including tractor oils, car engine oils, two-wheeler 4-stroke oils, and multi-grade diesel engine oils. Exhibit 11: Sensex rebased Exhibit 12: Shareholding pattern (%) Dec-15 Sep-15 Dec-14 Promoter DII FII Others Note: FII Includes depository receipts Exhibit 13: Top holders Holder Name % Holding Life Insurance Corporation Of India 4.5 Aberdeen Global Indian Equity (Mauritius) Ltd 1.3 Exhibit 14: Top management Name Designation Exhibit 15: Directors Name Name S M Datta Chairman S M Datta* Ralph Hewins Ravi Kirpalani Managing Director Ravi Kirpalani Peter Wiedner Uday Khanna* Sashi Mukundan R Gopalakrishnan* Jayanta Chatterjee Rashmi Joshi *Independent Exhibit 16: Auditors Name S R Batliboi & Co LLP Kishore Bhatia & Co Type Statutory Cost Auditor Exhibit 17: MOSL forecast v/s consensus EPS (INR) MOSL forecast Consensus forecast Variation (%) CY CY February

8 Disclosures Castrol India This document has been prepared by Motilal Oswal Securities Limited (hereinafter referred to as Most) to provide information about the company(ies) and/sector(s), if any, covered in the report and may be distributed by it and/or its affiliated company(ies). This report is for personal information of the selected recipient/s and does not construe to be any investment, legal or taxation advice to you. This research report does not constitute an offer, invitation or inducement to invest in securities or other investments and Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been furnished to you solely for your general information and should not be reproduced or redistributed to any other person in any form. This report does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. Before acting on any advice or recommendation in this material, investors should consider whether it is suitable for their particular circumstances and, if necessary, seek professional advice. The price and value of the investments referred to in this material and the income from them may go down as well as up, and investors may realize losses on any investments. Past performance is not a guide for future performance, future returns are not guaranteed and a loss of original capital may occur. MOSt and its affiliates are a full-service, integrated investment banking, investment management, brokerage and financing group. We and our affiliates have investment banking and other business relationships with a some companies covered by our Research Department. Our research professionals may provide input into our investment banking and other business selection processes. Investors should assume that MOSt and/or its affiliates are seeking or will seek investment banking or other business from the company or companies that are the subject of this material and that the research professionals who were involved in preparing this material may educate investors on investments in such business. The research professionals responsible for the preparation of this document may interact with trading desk personnel, sales personnel and other parties for the purpose of gathering, applying and interpreting information. Our research professionals are paid on the profitability of MOSt which may include earnings from investment banking and other business. MOSt generally prohibits its analysts, persons reporting to analysts, and members of their households from maintaining a financial interest in the securities or derivatives of any companies that the analysts cover. Additionally, MOSt generally prohibits its analysts and persons reporting to analysts from serving as an officer, director, or advisory board member of any companies that the analysts cover. Our salespeople, traders, and other professionals or affiliates may provide oral or written market commentary or trading strategies to our clients that reflect opinions that are contrary to the opinions expressed herein, and our proprietary trading and investing businesses may make investment decisions that are inconsistent with the recommendations expressed herein. In reviewing these materials, you should be aware that any or all of the foregoing among other things, may give rise to real or potential conflicts of interest. MOSt and its affiliated company(ies), their directors and employees and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the affiliates of MOSt even though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report Reports based on technical and derivative analysis center on studying charts company's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamental analysis. In addition MOST has different business segments / Divisions with independent research separated by Chinese walls catering to different set of customers having various objectives, risk profiles, investment horizon, etc, and therefore may at times have different contrary views on stocks sectors and markets. Unauthorized disclosure, use, dissemination or copying (either whole or partial) of this information, is prohibited. The person accessing this information specifically agrees to exempt MOSt or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSt or any of its affiliates or employees responsible for any such misuse and further agrees to hold MOSt or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The information contained herein is based on publicly available data or other sources believed to be reliable. Any statements contained in this report attributed to a third party represent MOSt s interpretation of the data, information and/or opinions provided by that third party either publicly or through a subscription service, and such use and interpretation have not been reviewed by the third party. This Report is not intended to be a complete statement or summary of the securities, markets or developments referred to in the document. While we would endeavor to update the information herein on reasonable basis, MOSt and/or its affiliates are under no obligation to update the information. Also there may be regulatory, compliance, or other reasons that may prevent MOSt and/or its affiliates from doing so. MOSt or any of its affiliates or employees shall not be in any way responsible and liable for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. MOSt or any of its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement. The recipients of this report should rely on their own investigations. This report is intended for distribution to institutional investors. Recipients who are not institutional investors should seek advice of their independent financial advisor prior to taking any investment decision based on this report or for any necessary explanation of its contents. Most and it s associates may have managed or co-managed public offering of securities, may have received compensation for investment banking or merchant banking or brokerage services, may have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past 12 months. Most and it s associates have not received any compensation or other benefits from the subject company or third party in connection with the research report. Subject Company may have been a client of Most or its associates during twelve months preceding the date of distribution of the research report MOSt and/or its affiliates and/or employees may have interests/positions, financial or otherwise of over 1 % at the end of the month immediately preceding the date of publication of the research in the securities mentioned in this report. To enhance transparency, MOSt has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report. Motilal Oswal Securities Limited is registered as a Research Analyst under SEBI (Research Analyst) Regulations, SEBI Reg. No. INH There are no material disciplinary action that been taken by any regulatory authority impacting equity research analysis activities Analyst Certification The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report. The research analysts, strategists, or research associates principally responsible for preparation of MOSt research receive compensation based upon various factors, including quality of research, investor client feedback, stock picking, competitive factors and firm revenues Disclosure of Interest Statement CASTROL INDIA Analyst ownership of the stock No Served as an officer, director or employee No A graph of daily closing prices of securities is available at and Regional Disclosures (outside India) This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject MOSt & its group companies to registration or licensing requirements within such jurisdictions. For U.S. Motilal Oswal Securities Limited (MOSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state laws in the United States. In addition MOSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any brokerage and investment services provided by MOSL, including the products and services described herein are not available to or intended for U.S. persons. This report is intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOSL has entered into a chaperoning agreement with a U.S. registered broker-dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this chaperoning agreement. The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research analyst account. For Hong Kong: This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong Kong Securities and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) SFO. As per SEBI (Research Analyst Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH ) has an agreement with Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of research report in Kong Kong. This report is intended for distribution only to Professional Investors as defined in Part I of Schedule 1 to SFO. Any investment or investment activity to which this document relates is only available to professional investor and will be engaged only with professional investors. Nothing here is an offer or solicitation of these securities, products and services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not located in Hong Kong & are not conducting Research Analysis in Hong Kong. For Singapore Motilal Oswal Capital Markets Singapore Pte Limited is acting as an exempt financial advisor under section 23(1)(f) of the Financial Advisers Act(FAA) read with regulation 17(1)(d) of the Financial Advisors Regulations and is a subsidiary of Motilal Oswal Securities Limited in India. This research is distributed in Singapore by Motilal Oswal Capital Markets Singapore Pte Limited and it is only directed in Singapore to accredited investors, as defined in the Financial Advisers Regulations and the Securities and Futures Act (Chapter 289), as amended from time to time. In respect of any matter arising from or in connection with the research you could contact the following representatives of Motilal Oswal Capital Markets Singapore Pte Limited: Kadambari Balachandran kadambari.balachandran@motilaloswal.com Contact : (+65) / Office Address : 21 (Suite 31),16 Collyer Quay,Singapore Motilal Oswal Securities Ltd 24 February 2016 Motilal Oswal Tower, Level 9, Sayani Road, Prabhadevi, Mumbai Phone: reports@motilaloswal.com