Maruti Suzuki India (MARUTI) 3823

Transcription

1 Result Update Rating matrix Rating : Buy Target : 4266 Target Period : 12 months Potential Upside : 11% What s Changed? Target Changed from 3700 to 4266 EPS FY16E Changed from to EPS FY17E Changed from to Rating Changed from Hold to Buy Quarterly Performance ( Crore) Q4FY15 Q4FY14 YoY (%) Q3FY15 QoQ (%) Revenue 13, , , EBITDA 2, , , EBITDA (%) bps bps Reported PAT 1, Key Financials Crore FY14 FY15E FY16E FY17E Net Sales 42,645 48,606 54,771 63,597 EBITDA 5, , , ,638.2 Net Profit 2, , , ,443.7 EPS ( ) Valuation summary FY14 FY15E FY16E FY17E P/E (x) Target P/E (x) EV/EBITDA (x) P/BV (x) RoNW (%) RoCE (%) Stock data Particular Amount Market Capitalization ( Crore) Crore Total Debt (FY14) ( Crore) Crore Cash and Investments (FY14) ( Crore) Crore EV ( Crore) Crore 52 week H/L ( ) 3704 / 1540 Equity capital ( crore) 151 Crore Face value ( ) 5 Price performance (%) 1M 3M 6M 12M Maruti Suzuki India Ltd M&M Ltd Tata Motors Ltd Research Analyst s name Nishit Zota nishit.zota@icicisecurities.com Vidrum Mehta vidrum.mehta@icicisecurities.com Margins drive the growth..!! April 28, 2015 Maruti Suzuki India (MARUTI) 3823 MSIL reported revenues of 13,625 crore vs. our estimate of 13,733 crore (up ~12.6% YoY) led by 6.7% YoY increase in volumes EBITDA margins at 15.9% came in ~558 bps higher YoY, much higher than our estimate of 13.1% owing to lower input cost, favourable foreign exchange and lower sales promotion expense. Higher margins boosted the profitability with PAT at 1,284 crore vs our estimate of 1,124 crore. (60.5% YoY higher) Management expects volumes to grow ~10% in FY16E outpacing the industry while lower discounts coupled with new launches (better product mix) & stable input cost could drive margins going forward. Market leader to benefit from domestic passenger vehicle up cycle! A recovery in the overall economy would have a multiplier effect on the passenger vehicle up cycle, which would benefit MSIL, the largest carmaker in India. We believe MSIL s largely petrol denominated small car portfolio is likely to benefit the most as the industry comes off a lean patch of about five years with overall volumes growing at merely ~5.9% CAGR in FY In the next five years, we expect penetration levels to increase from current lowly levels of ~15 cars per 1000 and march towards peer penetration levels (China: ~60/1000, Brazil: ~200/1000). New launches help withstand competition onslaught, retain market share MSIL has seen a major challenge to its dominant market share position as global carmakers launched products aimed to gain market share. However, it still stands at an impressive ~45% on the back of its vast distribution network (~1200 dealerships in ~800 cities) and strong service network (~3000 workshops in ~1400 cities). Launch of S-Cross and compact SUV will help MSIL create presence in the SUV segment. Diesel variant of Celerio & AMT based Swift model would help improve market share. Hence strong product pipeline of new launches and facelifts of some of its existing models coupled with further enhancement of distribution network & production capacity will help MSIL to maintain its leadership position in passenger vehicle even as competition intensifies. Leverage benefits, reducing discounts, forex to aid margin expansion! MSIL is likely to benefit with strong operating leverage benefits which would accrue as volumes pick up. With higher discretionary spending coupled new launches and higher contribution from the premium segment is likely to lever margins going forward. With demand likely to pick-up, we expect a reduction in average discounts from 19,625 in FY15 to 17,000 in FY16E and 15,000 in FY17E. Another factor that has aided margins has been JPY depreciation as well as localisation drive. Considering all factors, we have built in ~160 bps increase in margin over FY15-17E. Preferred domestic recovery play ; earnings on strong growth wicket We prefer four-wheeler auto segment to the two-wheeler segment as low penetration levels still provide headroom for sustained growth. We continue to remain bullish on longer-term growth prospects of the car segment, especially MSIL, considering its dominant market share at ~45%. Rationalisation of the diesel-petrol price gap is also expected to aid MSIL s petrol-dominated product portfolio. Currency also continues to aid MSIL. We believe earnings growth trajectory would be strong (~32% CAGR in FY15-17E). Thus, we ascribe a multiple of 20x its FY17E EPS of 213 and recommend Buy with target of 4,266. ICICI Securities Ltd Retail Equity Research

2 Variance analysis Q4FY15 Q4FY15E Q4FY14 YoY (Chg %) Q3FY15 QoQ (Chg %) Comments Total Operating Income 13,625 13,733 12, , Topline marginally below estimates due to lower than expected ASP Raw Material Expenses 9,223 9,617 8, , Lower input cost coupled with yen depreciation benefit resulted in lower raw material expenses Employee Expenses Higher staff expenses as it incorporated some bonus component Other expenses 1,730 1,881 1, , Lower advertisement expense coupled with currency benfit in royalty EBITDA 2,164 1,793 1, , EBITDA Margin (%) bps bps Higher than estimate mainly due to gross margin expansion Other Income Depreciation Interest Total Tax PAT 1,284 1, EPS Key Metrics ASP ( ) 382, , , , Higher ASPs due to better product mix led by Ciaz Provision for Royalty( cr) Discounts ( ) 15,500 21,000 17, , Discount levels have reduced due to recent fresh launches & facelifts Change in estimates FY16E FY17E ( Crore) Old New % Change Old New % Change Comments Revenue 54,864 56, ,350 65, Estimates have been raised on improved demand sentiment & newer product launches EBITDA 7,677 8, ,474 9, EBITDA Margin (%) bps bps PAT 4,685 5, ,042 6, EPS ( ) Assumptions Current Earlier Comments FY14E FY15E FY16E FY17E FY16E FY17E Total Volumes (nos) Volume growth of ~13% CAGR in FY14-17E on expectation of strong economic recovery, demand pick-up & new product launches Average ASPs ( ) 369, , , , , ,843 ASPs increase assumed on change in product mix with expected launches in premium hatchbacks, sedan & compact UV segment RMC/Unit ( ) 271, , , , , ,599 Raw material like steel and plastics likely to remain favourable but aluminium seems to be going up Royalty rates (%) Change in royalty rate assumed on the basis of future projections of US$/JPY rates and management commentary regarding royalty rates Discount ( ) 16,950 19,625 17,000 15,000 20,125 18,500 Discounts assumption based on management commentary, market feedback Company, ICICIdirect.com Research ICICI Securities Ltd Retail Equity Research Page 2

3 Key conference call takeaways The management targets ~10% volume growth for FY16E and is likely to outpace the overall industry growth of 6%-8% projected by SIAM. According to the management excise duty sops, rationalization of diesel prices, stable government and new product launches helped the domestic passenger vehicle industry which grew 3.9% YoY in FY15 as against a drop of 6% in FY14. For the industry, the share of diesel vehicles as a percentage of all new vehicles has declined to 45% in Q4FY15. For MSIL, the petrol segment grew ~15% in line with the industry while diesel segment grew by 2.8% against industry diesel sales which declined by 6.2%. According to the management, raw material prices are likely to remain stable going forward. Weakening of Euro (has a lag effect) would be positive for MSIL in Q1FY16E; however dollar strengthening against the rupee could offset some of these benefits. Hence most of the benefits in terms of currency fluctuation and soften of raw material have been seen Q4FY15, except if Yen depreciates further from current level. For the quarter, average discounts stood at 15,000, much lower compared to 21,000 in Q3FY15. This was due to better product mix, with new launches are offered with without discounts. Bulk of the localisation benefit has been made by the company, with direct and indirect import currently ~16% of sales while the royalty rate stands at ~5.7%. The management has guided for a capex of ~ 4,000 crore in FY16 as against capex of 3,000 in FY15. This is mainly towards new product launches, R&D and enhancing the marketing infrastructure and for annual maintenance capital expenditure. Exports for Q4FY15 stood at 1203 crore. Popular models like Swift, Dzire, Ertiga, and Ciaz were introduced in Africa and Latin America in FY15. The share of non-european market crossed 100,000 units with total exports volume growing by 20% during FY15. Management expects export volumes to remain flat in FY16E. On buyer segmentation, the management highlighted the fact that the first time car buyer class is ~44% much higher compared to ~35%- 40% and has scope for improvement up to ~50% going forward. The current rural urban mix for the MSIL stand at ~34% and ~66% respectively. For FY15, rural volumes grew by 23% YoY MSIL declared dividend of 25 per share in FY15 (with dividend payout of 24.5%) as against 12 per share in FY14. Management has guided that company is likely to maintain its payout ratio in the range of 18%-30% going forward. ICICI Securities Ltd Retail Equity Research Page 3

4 Company Analysis Unique position of dominance in spite of competition MSIL has maintained its market leadership despite the increase in competitive intensity. Despite ~18 players being in the fray fighting for the 2.5 million large market, MSIL has managed to hold ~45% market share. The financial performance has been strong over the past years with operating margins maintained at decent levels (over 10% in the recent past). On the business levers side, all factors range from cost of car ownership to demographics to new product launches led by S-Cross. Allied to this, on the financial levers side, better operating leverage and FX benefits are also in place to benefit MSIL. We expect revenue growth at ~14% CAGR in FY15-17E reaching ~ crore in FY17E. Margins are likely to remain on an uptrend and clock 14.6%, 14.8% in FY16E, FY17E, respectively, as industry demand improves, leading to better operating leverage and also reduction in discounting levels. Also, increased traction in newer products in premium categories would lead to better ASPs and, consequently, better margins and is likely to aid profitability. We expect the bottomline to grow at ~32% CAGR in FY15-17E and reach ~ 6444 crore in FY17E. Exhibit 1: Topline and bottomline trends ( crore) ( crore) 0 FY12 FY13 FY14 FY15E FY16E FY17E 0 Topline Bottomline Source: Company press release, ICICIdirect.com Research Exhibit 2: Margins to trend higher as volumes aid operating leverage ( crore) 12,000 10,000 8,000 6,000 4,000 2, , , , , , (%) FY13 FY14 FY15E FY16E FY17E - EBITDA Margins (%) Source: Company press release, ICICIdirect.com Research ICICI Securities Ltd Retail Equity Research Page 4

5 Export performance steady; bigger growth post Suzuki s Gujarat plant! Suzuki is aiming to let MSIL grow as a low-cost brand to target markets such as Africa. MSIL already contributes ~45% to Suzuki s global profits. As such, Suzuki s strategy to make MSIL its global export hub for low priced products is logical. Currently, exports form ~9% of total sales for MSIL, with the major export oriented product being the A-Star. However, recent quarters have seen a drop in the number owing to homologation changes in the major market Algeria. Also, specific regional issues like Egypt and Sri Lanka have led to a decline in export numbers from ~148,000 in FY10 to ~122,000 in FY15. Going ahead, FY16E is also likely to remain subdued for the export market and is likely to pick from FY17E onwards. We have taken a conservative ~10% CAGR in FY15-17E in export volumes. Exhibit 3: Export volumes dropping in past year. ('000s) FY11 FY12 FY13 FY14E FY15E FY16E FY17E Domestic Source: Company press release, ICICIdirect.com Research Exports MSIL turns page as market share remains key focus With an increase in competitive intensity from FY10-11 onwards coupled with an increasing gap in petrol-diesel prices shifting customer preference for diesel cars in FY12-13, MSIL s market share had reduced from ~47% in FY09 to ~39% in FY13. The market share was further lost on account of persistent labour troubles at Manesar in both FY12 and FY13, which halted production. However, with the fuel price fall and domestic fuel price deregulation, there has been a recovery in petrol cars. MSIL has since then increased its presence in terms of products as well as capacity in both the petrol as well as diesel space. Launches of successful products like Ertiga and Celerio also aided growth of market share in a challenging environment. MSIL has regained a lot of lost ground in terms of market share (YTD ~45% domestic). We expect MSIL to maintain >40% market share despite the improvement in competition and growth in the utility vehicle space in the coming years. ICICI Securities Ltd Retail Equity Research Page 5

6 Exhibit 4: Domestic PV market share for MSIL (%) FY09 FY10 FY11 FY12 FY13 FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 YTD for Q3FY15 Domestic Market Share Exhibit 5: Passenger car market share crosses 50% as demand for petrol cars revives Q1FY12 Q2FY12 Q3FY12 Q4FY12 Q1FY13 (%) Q2FY13 Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 Source: Company press release, ICICIdirect.com Research MSIL's domestic share Discounting levels on the rise as overall demand scenario remains muted In an intensely competitive industry struggling with demand slowdown, the increase in discounting levels to gain volumes is to be expected. As the market leader, MSIL has also been forced to give incentives to ward off competition and retain market share. However, we believe the new products launches (which do not offer any discounts) and improved product mix has been effective in reducing the impact of the demand slowdown. From the higher discount levels of 21,000 in Q3FY15, the same has substantially reduced to 15,000 in Q4FY15. We expect a reduction in average discounts from 19,625 in FY15 to 17,000 in FY16E and 15,000 in FY17E. ICICI Securities Ltd Retail Equity Research Page 6

7 Exhibit 6: Discounting levels remain elevated! ( ) Q1FY13 Q2FY13 Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 Source: Company press release, ICICIdirect.com Research Going ahead, as the industry recovers on the back of an improvement in overall economic scenario and interest rate cuts, discounting levels are likely to taper off from FY16E onwards, albeit not too sharply, thereby aiding profitability slowly. Exhibit 7: Annual discount trends and expectations ( ) ,625 17,000 15, FY12 FY13 FY14 FY15E FY16E FY17E ICICI Securities Ltd Retail Equity Research Page 7

8 Outlook and Valuation We prefer the four-wheeler auto segment to the two-wheeler segment as low penetration levels still provide headroom for sustained growth. We continue to remain bullish on the longer-term growth prospects of the car segment, especially MSIL, considering its dominant market share at ~45%. The rationalisation of the diesel-petrol price gap is also expected to aid MSIL s petrol-dominated product portfolio. Currency also continues to aid MSIL. We believe earnings growth trajectory would be strong (~32% CAGR in FY15-17E). Thus, we ascribe a multiple of 20x its FY17E EPS of 213 and recommend Buy with target of 4,266. Exhibit 8: Valuation Sales Growth EPS Growth PE EV/EBITDA RoNW RoCE ( cr) (%) ( ) (%) (x) (x) (%) (%) FY FY15E FY16E FY17E ICICI Securities Ltd Retail Equity Research Page 8

9 Company snapshot 4,500 4,000 Target Price: ,500 3,000 2,500 ( ) 2,000 1,500 1, Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Source: Bloomberg, Company, ICICIdirect.com Research Key events Date Event Feb-08 Government announces across the board excise duty cuts for the automotive space Sep-08 Stock market plunges on account of Lehmann crisis Jan-09 Maruti launches all new global product "A-star" May-09 Maruti defies global slowdown with stronger demand from first time buyers and exports driven by A-star Jul-09 Company's strong Q1FY10 results push stock to record high Feb-10 Largest recall in Maruti's history for 1 lakh A-star's for faulty parts. Maruti plans to double petrol capacity and investments to ~ 2,500 crore Jul-10 Q1FY10 marks the change in royalty rates for Maruti from 3.3% to 5.9%, market disappointed Mar-11 Auto stocks rebound as Union Budget witnesses no change of excise duties. Manesar workers go on strike for first time in May for two weeks Aug-11 Labour trouble again brews up, production halted. Maruti Q2FY12 skids due to labour problems and high forex impacts as JPY unfavourable Jan-12 Maruti witnesses strong valuation based bargain hunting as management expects worst to be over Apr-12 Maruti launches the much awaited MPV product "Ertiga". Maruti announces merger with SPIL to consolidate business on the diesel side Jul-12 Maruti stock tumbles as workers in Manersar facility turn violent, causes tragic death of HR manager Awanish Kumar Dev Aug-12 Management lifts lockout post violence receding; production starts albeit slowly Apr-13 Yen moving beyond 100 vis-à-vis US$ aids Q4FY13 profits as EBIDTA margins rise to 10.4% Oct-13 Localisation and cost reduction initiatives Maruti surprise on Q2FY14 financials as margins surprise Jan-14 MSIL board approves Gujarat plant expansion by way of 100% subsidiary of Suzuki Motor Corporation; institutional investors perturbed; stock falls Mar-14 Management alleviates concerns of minority shareholders and removes uncertainty over the "mark-up" issue Oct-14 Maruti launches a new product in the sedan segment "Ciaz" Apr-15 MSIL reports bumper margins of 15.9% in Q4FY15. Announces dividend of 25 per share Top 10 Shareholders Shareholding Pattern Rank Name Latest Filing Date % O/S Position (m) Change (m) 1 Suzuki Motor Corp 31-Dec Life Insurance Corporation of India 31-Dec HDFC Asset Management Co., Ltd. 31-Mar ICICI Prudential Life Insurance Company Ltd. 31-Dec Reliance Capital Asset Management Ltd. 31-Mar HSBC Global Asset Management (Hong Kong) Limited 28-Feb UTI Asset Management Co. Ltd. 28-Feb Schroder Investment Management Ltd. (SIM) 28-Feb ICICI Prudential Asset Management Co. Ltd. 31-Mar APG Asset Management 31-Dec Source: Reuters, ICICIdirect.com Research Recent Activity (in %) Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Promoter FII DII Others Buys Sells Investor name Value Shares Investor name Value Shares Capital World Investors 46.01m 0.78m Carmignac Gestion m -2.11m FIL Investment Management (Hong Kong) Limited 36.00m 0.61m Investec Asset Management Ltd m -1.26m HDFC Asset Management Co., Ltd m 0.57m William Blair & Company, L.L.C m -1.17m Birla Sun Life Asset Management Company Ltd m 0.27m Genesis Investment Management, LLP m -0.81m APG Asset Management 6.16m 0.22m T. Rowe Price Hong Kong Limited m -0.74m ICICI Securities Ltd Retail Equity Research Page 9

10 Financial summary Profit and loss statement Crore (Year-end March) FY14 FY15E FY16E FY17E Total operating Income 43,701 49,874 56,167 65,219 Growth (%) Raw Material Expenses 31,310 35,008 38,431 44,812 Employee Expenses 1,368 1,607 1,807 2,049 Marketing Expenses Administrative Expenses Other expenses 5,933 6,654 7,706 8,720 Total Operating Expenditure 38,611 43,268 47,944 55,581 EBITDA 5,090 6,606 8,223 9,638 Growth (%) Depreciation 2,084 2,470 2,567 2,896 Interest Other Income ,284 1,653 PBT 3,659 4,868 6,920 8,368 Others Total Tax 876 1,157 1,592 1,925 PAT 2,783 3,711 5,329 6,444 Growth (%) EPS ( ) Cash flow statement Crore (Year-end March) FY14 FY15E FY16E FY17E Profit after Tax 2,783 3,711 5,329 6,444 Add: Depreciation 2,084 2,470 2,567 2,896 (Inc)/dec in Current Assets ,341 Inc/(dec) in CL and Provisions 868 1, ,858 Others CF from operating activities 5,926 7,668 7,896 8,856 (Inc)/dec in Investments -3,583 5,817-1,000-1,000 (Inc)/dec in Fixed Assets -3,756-3,201-4,000-3,000 Others 1,355-8,403-1,230-1,037 CF from investing activities -5,985-5,787-6,230-5,037 Issue/(Buy back) of Equity Inc/(dec) in loan funds Dividend paid & dividend tax ,233-1,479 Inc/(dec) in Sec. premium Others 336-1, CF from financing activities -88-2,385-1,133-1,379 Net Cash flow ,439 Opening Cash Closing Cash ,098 Balance sheet Crore (Year-end March) FY14 FY15E FY16E FY17E Liabilities Equity Capital Reserve and Surplus 20,827 23,658 27,753 32,718 Total Shareholders funds 20,978 23,809 27,904 32,869 Total Debt 1, Deferred Tax Liability Others Liabilties Total Liabilities 23,686 24,868 29,114 34,228 Assets Gross Block 22,702 25,636 29,936 32,936 Less: Acc Depreciation 11,912 14,115 16,682 19,578 Net Block 10,790 11,521 13,253 13,357 Capital WIP 2,621 2,621 2,321 2,321 Total Fixed Assets 13,412 14,142 15,575 15,679 Investments 10,118 12,814 14,814 16,814 Inventory 1,706 2,615 1,587 3,397 Debtors 1,414 1,069 1,876 2,178 Loans and Advances 1,251 1,172 1,120 1,414 Other Current Assets Cash ,098 Total Current Assets 5,359 5,307 5,785 10,565 Creditors 4,898 5,561 5,627 6,447 Provisions 678 1,361 1,433 1,706 Other current Liabilities 1,274 1,867 1,673 2,437 Total Current Liabilities 6,849 8,789 8,733 10,590 Net Current Assets -1,491-3,481-2, Other Assets 1,647 1,393 1,673 1,761 Application of Funds 23,686 24,868 29,114 34,228 Key ratios (Year-end March) FY14 FY15E FY16E FY17E Per share data ( ) EPS Cash EPS BV ,088.1 DPS Cash Per Share Operating Ratios EBITDA Margin (%) PBT / Net sales (%) PAT Margin (%) Inventory days Debtor days Creditor days 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 Quick Ratio ICICI Securities Ltd Retail Equity Research Page 10

11 ICICIdirect.com coverage universe (Auto & Auto Ancillary) CMP M Cap EPS ( ) P/E (x) EV/EBITDA (x) RoCE (%) RoE (%) Sector / Company ( ) TP( ) Rating ( Cr) FY15E FY16E FY17E FY15E FY16E FY17E FY15E FY16E FY17E FY15E FY16E FY17E FY15E FY16E FY17E Amara Raja (AMARAJ) Hold 13, Apollo Tyre (APOTYR) Buy 8, Ashok Leyland (ASHLEY) Hold 19, Bajaj Auto (BAAUTO) 1,990 2,833 Buy 57, Balkrishna Ind. (BALIND) Hold 7, Bharat Forge (BHAFOR) 1,216 1,178 Hold 28, Bosch (MICO) 21,723 24,000 Hold 68, Eicher Motors (EICMOT) 15,175 18,800 Buy 40, Escorts (ESCORT) Hold 1, Exide Industries (EXIIND) Buy 14, Hero Mototcorp (HERHON) 2,356 3,036 Hold 47, JK Tyre & Ind (JKIND) Buy 2, M&M (MAHMAH) 1,182 1,457 Buy 69, Mahindra CIE (MAHAUT) Buy 6, Maruti Suzuki (MARUTI) Buy Motherson (MOTSUM) Buy Wabco India (WABTVS) Buy ICICI Securities Ltd Retail Equity Research Page 11

12 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; 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 research@icicidirect.com ICICI Securities Ltd Retail Equity Research Page 12

13 ANALYST CERTIFICATION We /I, Nishit Zota, MBA & Vidrum Mehta, 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 (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. 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