Phillips Carbon Black Ltd.

Transcription

1 October 10, 2012 Phillips Carbon Black Ltd. On a recovery path... CMP INR Target INR Initiating Coverage - BUY Key Share Data Face Value (INR) 10.0 Equity Capital (INR Mn) Week High/Low (INR) / months Avg. Daily Volume (NSE) 73,461 BSE Code NSE Code Reuters Code Bloomberg Code Shareholding Pattern (as on 30th Jun. 2012) Others, 29.65% FII's, 10.68% Source: Company Key Financials (INR Million) PHILIPCARB DII's, 7.41% Promoter 52.26% PHIL.BO PHCB IN Particulars FY11 FY12 FY13E FY14E Net Sales 16, , , ,418.2 Growth (%) 37.6% 29.0% 9.1% 14.9% EBITDA 2, , , ,648.6 PAT 1, ,098.3 Growth (%) -7.8% -24.0% -0.5% 28.9% EPS (INR) BVPS (INR) Key Financials Ratios Particulars FY11 FY12 FY13E FY14E P/E (x) P/BVPS (x) Mcap/Sales (x) EV/EBITDA (x) ROCE (%) 19.1% 13.4% 12.0% 13.0% ROE (%) 26.9% 15.3% 13.3% 15.2% EBITDA Mar (%) 13.1% 9.5% 9.4% 9.7% PAT Mar (%) 6.6% 3.9% 3.6% 4.0% Debt - Equity (x) Yr price performance PCBL vis-à-vis BSE Small Cap 15% 0% -15% -30% -45% -60% Oct-11 Dec-11 Mar-12 May-12 Jul-12 Oct-12 PCBL A Analyst: Nikhil Saboo BSE Small Cap Ph: , M: Company Background Phillips Carbon Black Ltd (PCBL) incorporated in 1960, is a part of RP- Sanjiv Goenka Group. The company is engaged in the manufacturing of carbon black having a capacity of 422,000 MT along with power generation capacity of 76 MW. Columbian Chemical Corporation, US, a leading international producer of rubber blacks is the technical collaborator of the company. Investment Rationale Strategic plant location with dominant market share PCBL enjoys a Pan India presence with four manufacturing plants, which are strategically located to cater to the tyre demands of the respective regions, thereby reducing the cost of freight. The domestic industry is consolidated with five players with PCBL having a market share of ~46 percent in FY12, in terms of production. Growth in the Automobile Industry to drive volumes To meet the growing demand (OEM & Replacement markets), majority of the tyre manufacturers are in the process of capacity expansion especially in the radials segment which would lead to utilisation of newer capacities of carbon black. Going forward, the radialization in truck segment is expected to reach ~35 percent (next 3 years) owing to infrastructure thrust and OE thrust, leading to an increase in the demand for tyres. Capacity expansion plan to propel growth PCBL is implementing a Greenfield expansion of 140,000 MT carbon black plant at Chennai along with 25 MW CPP at a total cost of INR 4,000 million which is expected to get commissioned in FY15. It is also setting up of a new coal tar distillation plant in Orissa with capacity of 1,50,000 mtpa coal tar processing and 50,000 mtpa soft pitch processing at an investment of INR 1,800 million. The 1,50,000 mtpa coal tar processing plant is expected to get commissioned in FY14 while 50,000 mtpa soft pitch processing will get commissioned in FY15. Surplus power sales to maintain margins With increase in the power generation capacity from 68 MW in FY12 to 84 MW by Oct. 12, the share of revenues from power sale is expected to increase to ~4.5 percent by FY14E from current 3.8 percent. The power business enjoys EBITDA margins of ~90 percent in the absence of raw material cost. Valuation We rate a BUY rating on PCBL with a price target of INR148/share, implying an upside potential of 39.6 percent from current levels. Our target price is based on PCBL s FY14E EV/EBITDA multiple of 5x. nikhil.saboo@skpmoneywise.com SKP Securities Ltd Page 1 of 14

2 Industry Overview The domestic industry is globally competitive, as most of the capacity in modern and product quality matches international standards Carbon black is a form of amorphous carbon that has an extremely high surface area to volume ratio and it is one of the first nanomaterials to find common use. Carbon black is a material, usually produced by the incomplete combustion of petroleum products. Carbon black is used in the tyre industry as well as in the non-tyre sector as reinforcing filler in rubber products and in the printing ink and paint industry. The tyre industry accounts for about 65 percent of carbon black demand in India followed by 15 percent in rubber and 20 percent is utilized by ink, printing, belts & hoses and other speciality chemicals etc. Carbon black helps in conducting heat away from the tread and belt area of the tyre, reducing thermal damage and increasing the durability of the tyre. Exhibit: Sector Wise Utilization of Carbon Black 15.0% 65.0% 10.0% 10.0% Tyre Rubber Belts & Hoses Printing, Ink & Other Speciality Environmental issue have made it difficult to produce carbon black in major developed countries as a result of which production is shifting to emerging countries During 2011, the global demand for carbon black rose by 5.8 percent from 10.2 million MT to 10.8 million MT, while global capacity and utilization stood at 13.9 million MT and 77 percent respectively. The demand growth was led by regions like North America (9.0 percent), European Union (11.0 percent) and Eastern Europe (14.7 percent), while Asia (excluding China) saw a modest growth of 5.2 percent compared to last year y-o-y growth of 18 percent. Exhibit: Global Carbon Black Scenario Figs. in Million MT Particulars CY09 CY10 CY11 Capacity Growth (%) - 5.5% 3.7% Capacity Utilization (%) 71% 76% 77% Demand SKP Securities Ltd Page 2 of 14

3 In India, the demand for carbon black during FY12 was 657,000 MT witnessing a y-o-y growth of 2.5 percent. Total production during FY12 was 694,000 MT, which is at the same level as FY11. The total capacity of the Indian carbon black industry stood at 935,000 MT, with capacity utilization of 74 percent. Exhibit: India Carbon Black Scenario Figs. in Million MT The domestic carbon black industry was impacted by a slowdown within the automobile sector as well as by the increasing dumping of carbon black into India by China and other countries Particulars FY10 FY11 FY12 Capacity Growth (%) % 18.4% Production Capacity Utilization (%) 90% 88% 74% Demand Around 40 percent of the tyre demand is led by the OEM segment while 60 percent is from the replacement segment (by revenue) Domestic tyre production is expected to get a boost from the high OEM and replacement demand from the tyre and automobile industry. Around 40 percent of the tyre demand is led by the OEM segment while 60 percent is from the replacement segment (by revenue). Furthermore, a number of international car makers are increasingly focusing on the Indian automobile industry and ramping up investment. In view of this, tyre manufacturers have lined-up capacity expansion plans in the near future, which are expected to benefit the domestic carbon black industry. The industry sold about million tyres in various segments in FY12 compared to million tyres sold in FY11. Demand growth for carbon black continues to be robust with the global demand expected to grow at a CAGR of 4.6 percent from 2010 to Domestic demand for carbon black is expected to grow at ~7-8 percent during FY13. Demand growth for carbon black continues to be robust with the global demand expected to grow at a CAGR of 4.6 percent from 2010 to 2015 Exhibit: Domestic Auto Sales Volumes Figs. in Millions FY06 FY07 FY08 FY09 FY10 FY11 FY12 Truck/Bus Light Trucks Pasng. Cars Farm Two Wheelers Others Source: Industry, SKP Research SKP Securities Ltd Page 3 of 14

4 Company Profile PCBL is the leading carbon black manufacturer in the country and seventh largest player across the globe Phillips Carbon Black Limited (PCBL), incorporated in 1960, is a part of RP-Sanjiv Goenka Group. The company is engaged in the manufacturing of carbon black and power generation. It is the leading carbon black manufacturer in the country and seventh largest player across the globe. Columbian Chemical Corporation, US, a leading international producer of rubber blacks is the technical collaborator of the company. Exhibit: Key Milestones : Started with Phillips Petroleum Co, USA at Durgapur with 14,000 MT. Collaboration with Columbian Chemical, Acquisition of CB division of Gujarat Carbon & Carbon &Chemicals, Ltd, Kochietc. 2005: Durgapur capacity increased to 1,40,000 MT & 12 MW CPP commissioned at 2007: Signed a MOU for plant in Vietnam 2008: 30 MW CPP commissioned at Durgapur 2009: MT & 16 MW CPP commissioned at Mundra 2011: 10 MW CPP commissioned at Kochi 2012: Mundra & Durgapur capacity increased to 1,40,000 & 1,52,000 MT Q1FY13: 8 MW CPP commissioned at Mundra The strategic location of four plants in different parts of India facilitate PCBL to optimize logistic costs within India and outside The company has four manufacturing facilities in India with total installed carbon black manufacturing capacity of 422,000 MT and power generation capacity of 76 MW. Its plant is located at Durgapur (West Bengal), Palej & Mundra (Gujarat) and Kochi (Kerala). PCBL is setting up a green field carbon black plant at Chennai and carbo chemical plant at Orissa, which going forward will further strengthen its geographical reach. Exhibit: Current Plant Overview Location Carbon Black Capacity Power Capacity Durgapur, West Bengal 1,52,000 MT 30 MW Palej, Gujarat 90,000 MT 12 MW Mundra, Gujarat 1,40,000 MT 24 MW Kochi, Kerala 40,000 MT 10 MW Total 4,22,000 MT 76 MW SKP Securities Ltd Page 4 of 14

5 PCBL products are exported to more than 20 countries, which contribute ~30 percent of its revenue. Multi-locational production facilities along with focus on product innovation and global technological alliance helps, PCBL to cater the demand of its customers across India. Its products are exported to more than 20 countries, which contribute ~30 percent of its revenue. PCBL manufacturers ~20-25 grades of carbon black which is supplied to the tyre industry, non-tyre industry and specialty chemicals sector. Investment Rationale Strategic plant location with dominant market share PCBL is the only player in the carbon black industry with a Pan India presence. It has four manufacturing plants in India which are strategically located to cater to the tyre demands of the respective regions, thereby reducing the cost of freight. Further, PCBL is setting up a green field carbon black plant at Chennai, which going forward will further strengthen its geographical reach. PCBL is setting up a green field carbon black plant at Chennai, which going forward will further strengthen its geographical reach Exhibit: Strategic Plant Locations Mundra Palej Carbon Black Plants Carbo Chemical Plants Durgapur Orissa Location Mundra Palej Kochi Capacity (FY12) MT + 16 MW MT + 12 MW MT + 10 MW Capacity (FY14E) * MT + 24 MW MT + 20 MW MT + 10 MW Orissa MT Kochi Chennai MRF Tyres Apollo Tyres JK Tyres 0 CeatTyres Durgapur MT + 30 MW MT + 30 MW Note: * Chennai capacity of MT & 25 MW power plant is expected to get commissioned in FY15. Also excluding Vietnam project of MT & 18 MW power plant. The domestic carbon black industry is consolidated with five players, accounting for the entire carbon black capacity. PCBL is the largest player in the domestic market having a market share of ~46 percent in FY12, in terms of production while globally it is ranked seventh. It takes around ~20-24 months to build a new carbon black manufacturing facility; hence, PCBL is well placed to take advantage of the expansions in the industry. SKP Securities Ltd Page 5 of 14

6 Exhibit: Domestic Production Market Share FY2010 FY2012 The Indian markets is dominated by top three players in the industry PCBL, Hi-Tech (Aditya Birla Nuvo) and Cabot India (a subsidiary of Cabot Corporation) 20.0% 42.0% 15.0% 46.0% 38.0% 39.0% PCBL Hi-Tech Others PCBL Hi-Tech Others Growth in the Automobile Industry to drive volumes Going forward, we expect a robust demand, on account of improvement in the macro environment and reversal in interest rates Over the last few months, the automobile industry in India witnessed a sluggish demand, especially in the commercial and passenger segment owing to slowdown in industrial investment, labour problems, high interest rates and fuel prices etc. A slowdown in the automobile segment resulted in major tyre companies resorting to production cut due to which the demand for carbon black remained subdued. Though, there might be a short term glitch, the long term outlook of the Indian Automobile industry looks robust. Going forward, we expect a robust demand, on account of improvement in the macro environment and reversal in interest rates. Further, the replacement segment will continue to grow at a healthy pace with higher commercial vehicle fleet utilisation in line with growing industrial production. Thus, to meet the growing demand (OEM & Replacement markets) majority of the tyre manufacturers are in the process of capacity expansions especially in the radials segment which would lead to utilisation of newer capacities of carbon black. Exhibit: Tyre Companies Expansion Plan 50 Expansion plans of all major tyre companies in India are on track and their plants are expected to come up during FY13 - FY15 Figs. in INR Billion Apollo Tyres 14 Balkrishna Ind. 33 Bridgestone India 10 Ceat Ltd 5 Dunlop India 6 Falcon Tyres 18 JK Tyres 38 MRF Ltd 40 Michelin Note: Investment done from Jan 2010 & expected till Dec 2014 SKP Securities Ltd Page 6 of 14

7 The radialization of truck tyres is still at extremely low levels in India and offers huge opportunity for tyre companies. Going forward, the radialization in truck segment is expected to reach ~35 percent (next 3 years) owing to infrastructure and OE thrust, leading to an increase in the demand for tyres, thereby boosting the demand for carbon black. Exhibit: Radialisation in Truck Segment India Eastern Europe 21% 27% Going forward, the radialization in truck segment is expected to reach ~35 percent (next 3 years) owing to infrastructure and OE thrust, leading to an increase in the demand for tyres Asia South America World Africa/Middle East Central Europe North America 52% 65% 68% 72% 95% 96% Western Europe 100% 0% 20% 40% 60% 80% 100% 120% Source: Industry Sources, SKP Research Capacity expansion plan to propel growth PCBL is implementing a Greenfield expansion of 140,000 MT carbon black plant at Chennai along with 25 MW CPP at a total cost of INR 4,000 million which is expected to get commissioned in FY15 To meet the growing demand of carbon black, PCBL had undertaken significant capacity addition across all its manufacturing plants over the last two years as well increased its co-generation power capacity. In FY12, PCBL completed expansion of carbon black plant of 50,000 MT at Mundra, 11,000 MT at Durgapur along with 10 MW captive power plant (CPP) plant at Kochi. During Q1FY13, PCBL commissioned its 8 MW CPP at Mundra, and is underway to commission 50,000 MT of carbon black capacity at Cochin plant and 8 MW CPP at Palej, Gujarat (expected by September 2012), thereby taking the total carbon black capacity to 472,000 and co-generation power capacity to 84 MW. The company is implementing a Greenfield expansion of 140,000 MT carbon black plant at Chennai along with 25 MW CPP at a total cost of INR 4,000 million which is expected to get commissioned in FY15. The funding for the same will be done through a mix of debt and internal accruals in the ratio of 2:1. PCBL has already signed Memorandum of Understanding (MoU) with the Tamil Nadu Government and is in the process of obtaining all approvals for the same. SKP Securities Ltd Page 7 of 14

8 In order to partially offset its volatility, PCBL has planned to use coal tar as its raw material. Coal Tar is a byproduct generated through the processing of coal into coke for use in steel manufacturing The key raw material for PCBL is Carbon Black Feed Stock (CBFS), which is directly linked to the international crude oil prices and is imported from USA. In order to partially offset its volatility, PCBL has planned to use coal tar as its raw material. Coal Tar is a by-product generated through the processing of coal into coke for use in steel manufacturing. PCBL is setting up of a new coal tar distillation plant (Carbo Chemical business) in Orissa with capacity of 1,50,000 mtpa coal tar processing and 50,000 mtpa soft pitch processing at an investment of INR 1,800 million. The 1,50,000 mtpa coal tar processing plant is expected to get commissioned in FY14 while 50,000 mtpa soft pitch processing will get commissioned in FY15. The entire Vietnam projects have been kept under review on account of slowing demand scenario PCBL planned to set up 115,000 MT carbon black plant at Vietnam along with 18 MW CPP in two phases at an investment of USD 84 million, which was to be funded through a debt equity ratio of 2:1. The first phase of 60,000 MT carbon black along with 12 MW CPP was expected to get commissioned in FY13 while the second phase consisting of 55,000 MT carbon black and 21 MW was scheduled to get commissioned in FY14. Though, the entire Vietnam projects have been kept under review on account of slowing demand scenario. Till date, investments in Vietnam projects stand at ~USD 5-7 million. Surplus power sales to maintain margins The process of manufacturing of carbon black results in generation of lean gases which have both sensible heat and low calorific value. Instead of wasting the energy, PCBL has installed extremely specialized and state of the art 30 MW CPP at Durgapur, 12 MW CPP at Palej, 24 MW CPP at Mundra and 10 MW CPP at Kochi. Waste gases from plants being used to produce electricity, Surplus power sold to grid at an average realization of INR /unit The entire lean gas is used to generate power for meeting the entire internal process requirements for production of carbon black as well as surplus is sold to the grid. At present, about percent of power produced is used for own captive consumption while rest is sold to the grid at an average realization of INR /unit. During FY12, 3.8 percent of the revenues accrue from the sale of power. With the increase in the power generation capacity from 68 MW in FY12 to 84 MW by October 2012, the share of revenues from power sale is expected to increase to ~4.5 percent in the next two years. SKP Securities Ltd Page 8 of 14

9 Exhibit: Co-Generation Power Incineration The power business enjoys EBITDA margins of ~90 percent in the absence of raw material cost Earlier Waste Gas Waste Gas Co- Electricity Internal Plant Requirement WasteGas generated at the Carbon Black Plant Surplus power soldto 76 MW green power generating capacity The power business enjoys EBITDA margins of ~90 percent in the absence of raw material cost. Its increasing presence in PCBL s revenue profile is likely to provide a cushion to the overall EBITDA margins and reduce the dependence of PCBL s earnings from carbon black. Exhibit: Revenue & EBIT Breakup With the increase in the power generation capacity from 68 MW in FY12 to 84 MW by October 12, the share of revenues from power sale is expected to increase to ~4.5 percent in the next two years Revenue Split (FY12 12) 3.8% EBIT Split (FY12 12) 40.6% 59.4% 95.9% Carbon Black Power Carbon Black Power Strong clientele base The carbon black industry typically has a product mix of 70:30 for Tyre: Non-Tyre customers. Being present for over five decades in the industry has enabled PCBL to develop long standing customer relationship. It has a wide range of customers which comprises of prominent and growing companies like MRF, Apollo Tyres, CEAT Tyres, Good Year, Bridgestone, Loadstar etc. Long-established relationship with its clients and diversified client profile helps PCBL to get repeat orders and also reduces customer concentration risk. SKP Securities Ltd Page 9 of 14

10 Exhibit: Clientele Base Domestic Customers International Customers Key Concerns CBFS which is the key raw material for PCBL is directly linked to the international oil prices and is imported from USA. Over the last couple of year s international oil prices is on an uptrend and is subject to frequent volatility while the prices of finished carbon black are revised every quarter. In order to partially offset its volatility, PCBL has planned to use coal tar as its raw material. Though, this might take time as plant is expected to get commissioned in FY14-15 only. Therefore, any unfavourable movement in CBFS prices and inability to completely pass it on to the end consumers will have an adverse impact on the PCBL s margins. Exhibit: CBFS Expense as a %age of Sales Any unfavourable movement in CBFS prices vis-à-vis carbon black prices and inability to completely pass it on to the end consumers will have an adverse impact on the PCBL s margins Figs in INR Billion FY09 FY10 FY11 FY12 80% 75% 70% 65% 60% CBFS Expense CBFS Expense as a %age of Sales Despite anti-dumping duty on carbon black, import has been increasing over the past few years. Total imports of carbon black in India rose to 117,000 MT during FY12 from 70,000 MT in the earlier year, and the major chunk of imports was from China, at 83,000 MT. As a result, domestic companies resorted to production cuts during FY12. Thus, the threat of cheap imports always remains high which may prove detrimental to the interest of PCBL. SKP Securities Ltd Page 10 of 14

11 The carbon black industry is treated as high pollution emitting industry by the Ministry of Environment and Forest (GOI). The Central Pollution Control Board has categorized the carbon black industry under the highly polluting industry (red category) and companies need to comply with the norms in this regard. Any negative impact on the same would impact PCBL growth going forward. Valuations At current market price of INR 106/share, PCBL is trading at an EV/EBITDA of 4.81x and 4.45x FY13E and FY14E EBITDA respectively. We valued PCBL s business at FY14E EV/EBITDA multiple of 5x. Thus, we arrived at a price target of INR 148/share, implying an upside potential of 39.6 percent in 18 months. Exhibit: Value based on FY14E EV/EBITDA We maintain a BUY rating with a price target of INR 148.0/share, reflecting an upside potential of 39.6 percent from current levels Target EV/EBITDA Multiple FY14E EBITDA (INR Million) Target Enterprise Value (INR Million) Less: FY14E Debt (INR Million) Less: Minority Interest (INR Million) Add: FY14E Cash (INR Million) Target Market Cap (INR Million) No of Shares (Million) Target Price Per Share (INR) Source: SKP Research 5.0 x 2, , , , PCBL historically traded in a narrow band of 3x to 6x on the one year forward EV/EBITDA basis, despite high volatility in earnings on account of CBFS prices One Year Forward EV/EBITDA Band Exhibit: One Year Forward EV/EBITDA Band Mar-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Figs. In INR Billion Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 7x 6x 5x 4x 3x SKP Securities Ltd Page 11 of 14

12 One Year Forward P/Bv Band Exhibit: One Year Forward P/BV Band At CMP, PCBL is trading at 0.54x and 0.48x its FY13E and FY14E book value, respectively Mar-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 x 1x 0.8x 0.6x 0.4x One Year Forward P/E Band Exhibit: One Year Forward P/E Band At CMP, the stock is trading at 4.3x and 3.3x its FY13E and FY14E earnings, respectively Mar-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 6x 5x 4x 3x 2x The company is likely to fund most of its expansion through internal accruals Financial Outlook To fund most of its expansion through internal accruals Exhibit: CFO & D/E Ratio FY11 FY12 FY13E FY14E Figs. in INR Billion Cash Flow from Operations (CFO) D/E (x) SKP Securities Ltd Page 12 of 14

13 Exhibit: Income Statement Figures in INR Million Exhibit: Balance Sheet Figures in INR Million Particulars FY11 FY12 FY13E FY14E Particulars FY11 FY12 FY13E FY14E Net Sales 16, , , ,418.2 Share Capital Growth (%) 37.6% 29.0% 9.1% 14.9% Reserve & Surplus 4, , , ,315.0 Expenditure 14, , , ,769.6 Share Warrants Material Consumed 12, , , ,725.4 Shareholders Funds 5, , , ,659.7 Power & Fuel Cost Secured Loan 3, , , ,731.9 Employee Cost Unsecured Loan , , ,640.0 Freight Cost Total Debt 4, , , ,371.9 Admin & Other Exp. 1, , , ,645.9 Minority Interest EBITDA 2, , , ,648.6 Deferred Tax Liability EBITDA Margin (%) 13.1% 9.5% 9.4% 9.7% Total Liabilities 10, , , ,827.3 Depreciation EBIT 1, , , ,062.0 Net Block inc Capital WIP 7, , , ,181.1 Other Income Investments Interest Expense Current Assets 8, , , ,941.6 Profit Before Tax (PBT) 1, , , ,449.9 Inventories 2, , , ,535.9 Income Tax Sundry Debtors 3, , , ,477.0 Minority Interest Cash & Bank Balance Profit After Tax (PAT) 1, ,098.3 Other Current Assets Growth (%) -7.8% -24.0% -0.5% 28.9% Loans & Advances 1, , , ,358.7 PAT Margins (%) 6.6% 3.9% 3.6% 4.0% Current Liabilities & Prov 6, , , ,734.4 Diluted EPS Total Assets 10, , , ,827.3 Exhibit: Cash Flow Statement Figures in INR Million Exhibit: Ratio Analysis Particulars FY11 FY12 FY13E FY14E Particulars FY11 FY12 FY13E FY14E PBT 1, , , ,449.9 Earning Ratios (%) Depreciation EBITDA Margin (%) 13.1% 9.5% 9.4% 9.7% Interest Provided PAT Margins (%) 6.6% 3.9% 3.6% 4.0% Chg. in Working Capital (213.9) (2,781.8) (111.1) (1,350.8) ROCE (%) 19.1% 13.4% 12.0% 13.0% Direct Taxes Paid (243.3) (199.8) (276.4) (351.6) ROE (%) 26.9% 15.3% 13.3% 15.2% Other Non Cash Charges (14.9) (21.6) - - Per Share Data (INR) Operating Cash Flows 1,869.7 (913.0) 1, ,077.9 Diluted EPS Capital Expenditure (1,546.8) (938.5) (1,781.0) (1,092.0) Cash EPS (CEPS) Investments (30.1) (32.5) BVPS Others Valuation Ratios (x) Investing Cash Flows (1,484.9) (877.7) (1,811.1) (1,124.5) P/E Inc /(Dec) in Debt (782.8) 1, ,085.0 Price/BVPS Dividend Paid (inc tax) (192.3) (192.1) (161.3) (201.6) EV/Sales Interest Paid (443.3) (596.7) (692.0) (743.8) EV/EBITDA Others 1, , Dividend Yield (%) 3.4% 3.6% 3.8% 4.7% Financing Cash Flows (57.9) 1,285.4 (120.3) Balance Sheet Ratios Chg. in Cash & Cash Eqv (505.4) Debt - Equity Opening Cash Balance Current Ratio Closing Cash Balance Fixed Asset Turn. Ratios Source: Company Data, SKP Research SKP Securities Ltd Page 13 of 14

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SKP Securities Ltd Contacts Research Sales Mumbai Kolkata Mumbai Kolkata Phone Fax researchmum@skpmoneywise.com research@skpmoneywise.com Skp.sec@bloomberg.net Member: NSE BSE NSDL CDSL NCDEX* MCX* MCX-SX FPSB *Group Entities INB/INF: , BSE INB: , CDSL IN-DP-CDSL , DPID: , NSDL IN-DP-NSDL: , DP ID: IN302646, ARN: 0006, NCDEX: 00715, MCX: 31705, MCX-SX: INE SKP Securities Ltd Page 14 of 14