Maruti Suzuki India (MARUTI) 6420

Transcription

1 Result Update Rating matrix Rating : Buy Target : 7200 Target Period : 12 months Potential Upside : 12% What s Changed? Target Changed from 6720 to 7200 EPS FY18E Changed from 283 to 280 EPS FY19E Changed from 320 to 328 Rating Unchanged Quarterly Performance ( Crore) Q4FY17 Q4FY16 YoY (%) Q3FY17 QoQ (%) Revenue 18, , , EBITDA 2, , , EBITDA (%) bps bps Reported PAT 1, , , Key Financials Crore FY16 FY17E FY18E FY19E Operating Income 57,746 67,968 80,533 93,858 EBITDA 8, , , ,111.6 Net Profit 4, , , ,898.2 EPS ( ) Valuation summary FY16 FY17E FY18E FY19E 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 (FY16) 77.4 Crore Cash and Investment (FY16) Crore EV Crore 52 week H/L ( ) 6450 / 3725 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 Nishit Zota nishit.zota@icicisecurities.com Vidrum Mehta vidrum.mehta@icicisecurities.com Strengthening its dominance! April 28, 2017 Maruti Suzuki India (MARUTI) 6420 Maruti Suzuki (MSIL) reported its Q4FY17 numbers, which came in line with our estimates on the profitability front. Revenues at crore, up 20.3% YoY, 8.7% QoQ were above our estimate of crore. Topline growth was driven by 15% YoY volume growth & 4.9% YoY ASP growth. The marginal revenue beat is attributable to higher than estimated ASPs ( vs. our estimate of ) Volumes for Q4FY17 at units were up 15% YoY. Of this, domestic volumes grew 14.8% YoY to units while exports were up 17.6% YoY to units EBITDA was up 9.9% YoY, 2.9% QoQ to 2561 crore, marginally above our estimates of 2517 crore. Reported EBITDA margins were at 14%, down 131 bps YoY, 79 bps QoQ, marginally above our estimate of 13.9%. The gross margin decline was due to preoperative one-time cost of Gujarat plant, which was partly offset by lower discounts. YoY, EBITDA margins were impacted by adverse impact of a rise in commodity prices & higher selling expenses PAT came in at 1709 crore, up 15.8% YoY, down 2% QoQ, in line with our estimate of 1712 crore The Board recommended a dividend of 75 per share for FY17 against 35 per share in FY16 Preparing for future MSIL has shown resilience in tough times (demonetisation) with its domestic volumes growing 4% YoY, outpacing the passenger vehicle industry growth of 1.8% YoY (supported by 20% YoY growth in UV segment). For FY17, MSIL domestic volumes grew 10.7% YoY, outpacing industry growth of 9.2% YoY. Even when the diesel share of industry volumes is declining, MSIL s diesel volumes increased 13.6% YoY. This outperformance can be attributed to strong demand for its new models like Baleno, Brezza & Ignis, which have a waiting period of 24 weeks and 18 weeks, respectively. MSIL has been aggressive in terms of adding more content in car (airbags/abs in base models, launching smart hybrids variants & automatic transmission option in its models) & expanding its dealer network (~2312 retail outlets in FY17). Lastly, MSIL s parent company Suzuki Motocorp has recently formed a JV with Denso Corp & Toshiba Corp to produce lithium ion batteries, which will equip MSIL for the future trend of hybrid & electric cars. We expect volume CAGR of 11% in FY17-19E. New plant & commodity prices impact margins in near term Ramp up of the Gujarat plant will also have some adverse impact on margins in the near term. However, reduced exposure to JPY due to higher exports to Japan and royalty payment on new products in rupee, lower discounts led by better product mix, positive operating leverage led by strong demand and weaker yen will contribute positively to margins. We estimate EBITDA margins of 15% for both FY18E, FY19E. Strong earnings visibility demands premium valuation In the past seven years, MSIL s average one-year forward multiple was 16x with peak multiple of 27x. We believe strong earning visibility, should command premium valuation. Hence, we value the stock at 22x FY19E EPS of 328, to arrive at a target price of 7200 with BUY rating on MSIL. ICICI Securities Ltd Retail Equity Research

2 Variance analysis Q4FY17 Q4FY17E Q4FY16 YoY (Chg %) Q3FY17 QoQ (Chg %) Comments Total Operating Income 18,333 18,146 15, , Topline marginally above estimates due to lower-than-expected ASP Raw Material Expenses 12,767 12,893 10, , Higher input costs (mainly steel prices) & adverse impact of preoperative costs taken by SMG (charged to MSIL) Employee Expenses Other expenses 2,390 2,145 2, , Launch of Baleno RS, Ignis & Ciaz in Nexa channel lead to higher selling expenses Operating Profit (EBITDA) 2,561 2,517 2, , EBITDA Margin (%) bps bps Other Income Depreciation The depreciation cost was lower YoY due to change in depreciation policy Interest Total Tax PAT 1,709 1,712 1, , In line with estimates EPS Key Metrics ASP ( ) 434, , , , Provision for Royalty( cr) In line with estimates Discounts ( ) 15,194 17,500 17, , Discounts lower than estimated Change in estimates FY18E FY19E ( Crore) Old New % Change Old New % Change Comments Total Operating Income 82,759 80, ,495 93, Estimates have been reduced due to downward revision of volume estimates by 3.3% & 2.3% for FY18E & FY19E, respectively EBITDA 12,392 12, ,327 14, EBITDA Margin (%) bps bps We maintain our margin estimates as ramp up in Gujarat plant can have an adverse impact on margins PAT 8,548 8, ,662 9, EPS ( ) Assumptions Current Earlier Comments FY15 FY16 FY17 FY18E FY19E FY18E FY19E Total Volumes (nos) Volume estimates downward revised by 3.3% & 2.3% for FY18E & FY19E, respectively, as exports are expected to remain flat next fiscal with some supply constraint due to a gradual ramp up in Gujarat plant Average ASPs ( ) 376, , , , , , ,307 ASPs increase assumed on change in product mix & reducing discounts RMC/Unit ( ) 270, , , , , , ,391 Royalty rates (%) Discount ( ) 19,529 18,898 16,774 15,500 15,500 16,000 16,000 Discounts will reduce as new launches & product refreshes will form significant share of volumes Company, ICICIdirect.com Research ICICI Securities Ltd Retail Equity Research Page 2

3 Key conference call takeaways The management has guided for volume growth of 10-12% for FY18 mainly supported by strong demand for its new launches. The export market is likely to remain flattish as MSIL awaits recovery from its key markets like Africa and Sri Lanka. Its entry into newer markets like Europe has resulted into higher volumes in Q4FY17; partly offsetting the lower demand from Africa and Sri Lanka MSIL s current capacity at its Gurgaon & Manesar plant is at 1.6 million units. Its Gujarat plant started its operations in Q4FY17 with an initial capacity of 10,000 units & is expected to reach 150,000 units by FY18 & further touch 250,000 units by FY19 For FY17, MSIL s capex was at 3200 crore. It is expected to spend ~ 4500 crore for FY18. A significant budget will be towards development of 75 land parcels over the next year. Apart from that, the fund will also be used for new product development & for other maintenance related spend Average discount for Q4FY17 was at 15,194 vs. 17,500 in Q4FY16 while average discount for FY17 was at 16,774 vs. 18,869 in FY16 The first time buyer currently accounts for ~44% of its overall volumes, the remaining ~56% is distributed evenly between replacement buyers & from buyers who switch from other brands. The share of government employees is currently at 20% of MSIL s overall volumes The management has guided that its parent (Suzuki) has tied up with Toyota & Denso to manufacture lithium ion battery plant in India. The company will be established in 2017 and is likely to commence its production over the next two years According to the management, the fleet operator segment currently accounts for ~6% of overall volumes. It is too early to make a judgment on its overall impact on the company For Q4FY17, export revenue was at ~ 1,500 crore (8% of overall sales) while for FY17 it was at ~ 6,000 crore (9% of overall sales Royalty for Q4FY17 & FY17 was at crore and 3848 crore, respectively (5.2% of sales) 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 3 million large market, MSIL has managed to increase its market share from ~42% in FY14 to 47.4% in FY17. The financial performance has been strong over the past years with operating margins maintained at decent levels (over 10% in the last 16 quarters). On the business levers side, all factors range from cost of car ownership to demographics to new product launches led by Baleno & Vitara Brezza. We have estimated volume CAGR of 11% in FY17-19E. We expect revenue growth at ~18% CAGR in FY17-19E with revenues of ~ crore in FY19E. Ramp up of the Gujarat plant will also have some adverse impact on the margins in the near term. However, reduced exposure to JPY due to increased exports to Japan and royalty payment on new products in rupee, lower discounts led by better product mix, positive operating leverage led by strong demand and weaker yen will contribute positively to margins. We estimate EBITDA margins of 15% for both FY18E, FY19E. We expect the bottomline of ~ 9898 crore in FY19E. Exhibit 1: Topline and bottomline trends ( crore) ( crore) 0 FY12 FY13 FY14 FY15 FY16 FY17E FY18E FY19E Topline Bottomline 0 Source: Company press release, ICICIdirect.com Research ICICI Securities Ltd Retail Equity Research Page 4

5 Exhibit 2: Margins to be at healthy levels ( crore) 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, , , , , , , ,111.6 FY13 FY14 FY15 FY16 FY17E FY18E FY19E (%) EBITDA Margins (%) Source: Company press release, ICICIdirect.com Research Export performance to moderate in near-term; larger 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. Export volumes are expected to be flat in FY18E. The decline in volumes in the Sri Lankan market is expected to be offset by growth in export of Baleno. Going ahead, we have taken ~7% CAGR in FY17-19E in export volumes. Exhibit 3: Export volumes 2500 ('000s) FY11 FY12 FY13 FY14 FY15 FY16 FY17E FY18E FY19E Domestic Exports Source: Company press release, ICICIdirect.com Research 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 petrol as well as diesel space. Launches of successful products ICICI Securities Ltd Retail Equity Research Page 5

6 like Ertiga, Celerio, Ciaz and more recently Baleno, Brezza aided growth in market share. MSIL has regained the lost ground in terms of market share (current market share-47.4% domestic). We expect MSIL to maintain ~45% plus market share despite the improvement in competition and growth in the utility vehicle space in the coming years. Exhibit 4: Domestic PV market share for MSIL (%) Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Domestic Market Share YTD Discounting levels to decline with better demand sentiment, new launches In an intensely competitive industry struggling with a demand slowdown, the increase in discounting levels to gain volumes is to be expected. As the market leader, MSIL had 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 facelifts will lead to an improved product mix that will effectively reduce the discount levels. Discount on small cars (Alto, Wagon R) is broadly linked to the broad macro environment. These discounts will reduce with the improving macroeconomic conditions. We expect a reduction in average discounts from in FY17 to 15,500 in FY19E. 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 FY17 onwards, albeit not too sharply, thereby aiding profitability slowly. Exhibit 5: Annual discount trends and expectations ( ) ,529 18,898 16,774 15,500 15, FY12 FY13 FY14 FY15 FY16 FY17E FY18E FY19E ICICI Securities Ltd Retail Equity Research Page 6

7 Key takeaways from annual report MSIL s rural coverage increased from 124,620 villages in FY15 to 144,215 villages in FY16. The company increased its share in the top 10 markets of the country. Rural demand moderated following second successive year of below normal monsoon, leading to a drought-like situation in certain parts of the country. The company was able to grow sales in small towns & rural areas by 9%, largely by expanding reach to newer towns and villages MSIL s pre-owned car operation continued to support new car sales. Trade-ins grew 9% and accounted for 30% of new car sales With 70% of sales being contributed by petrol vehicles, MSIL is well positioned in this segment with 58.7% market share Fleet sales surged 60%, although on a low base, mainly on account of demand from taxi aggregators The share of vehicles financed reached 77.4%, highest in nine years Over 125 Nexa outlets were set up in FY16 while nearly 70,000 cars were sold through this channel. The company expects to double the number of Nexa outlets in FY17E. Apart from Nexa, it is also strengthening its existing network by adding >200 outlets during the year taking the total outlets to 1,820 in the existing channel The currency crisis in certain economies impacted demand adversely. In Sri Lanka, import duty was brought down for a few months helping sales, which surged during this period. The share of Sri Lanka in overall export sales increased to 32% in FY16 vs. 10% in FY15 Maruti Suzuki has sold over 5.44 lakh alternate fuel vehicles cumulatively till FY16 with yearly sales of ~60,000 units Nearly, 88% of the supplier base by value is located within 100 km radius of the company Combined output capacity of all plants in Gurgaon & Manesar is at about 1.5 million units annually. MSIL is focused on enhancing manufacturing capability through better utilisation of facilities, higher flexibility in plant-model combinations and flexible lines. This will enable it to meet market demand before SMC s Gujarat plant starts supplying cars in early 2017 The company has appointed a group of specialists and started acquiring land sites for future expansion of sales, service and spare part facilities. Acquisition of sites for MSIL s own retail space has been done from a long-term de-risking point of view. Besides the existing network of sales and services will be expanded to have more touch points with customers R&D/product developments, R&D spend in FY16 was lower than FY15 at ~1% of sales (by 10% or ~30 bps) MSIL saved 42 crore by localisation (vs. 224 crore in FY15) and ~ 219 crore (vs. 247 crore in FY15) from implementation of value analysis/value engineering (VA/VE) proposals 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 ~47%. Notwithstanding short-term concerns, MSIL is improving its competitive positioning and has long term strengths. MSIL s strong product portfolio & distribution network make it best placed to capture pent-up demand in passenger vehicle segment. We ascribe a multiple of 22x to its FY19E EPS of 328 and have a BUY recommendation on the stock with a target price of Exhibit 6: Valuation Sales Growth EPS Growth PE EV/EBITDA RoNW RoCE ( cr) (%) ( ) (%) (x) (x) (%) (%) FY15 49, FY16 57, FY17E 67, FY18E 80, FY19E 93, ICICI Securities Ltd Retail Equity Research Page 8

9 (%) ( ) Recommended history vs. consensus 8, ,000 6, ,000 4,000 3, ,000 1, Apr-15 Jul-15 Sep-15 Nov-15 Feb-16 Apr-16 Jul-16 Sep-16 Dec-16 Feb Apr-17 Price Idirect target Consensus Target Mean % Consensus with BUY Source: Bloomberg, Company, ICICIdirect.com Research Key events Date Event 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 May-15 Maruti Suzuki 'Swift' completed 10 years of debut. The company has sold over 1.3 million car over the last 10 years Jun-15 Company launches Celerio's diesel variant at 4.65 lakh Jul-15 Maruti opens booking for premium crossover S-CROSS which is likely to to sold through its NEXA (premium) showrooms Oct-15 Maruti launches its premium hatchback Baleno to be sold through its NEXA (premium) showrooms Top 10 Shareholders 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-Dec The Vanguard Group, Inc. 31-Mar Invest AD 31-Dec BlackRock Institutional Trust Company, N.A. 31-Mar ICICI Prudential Asset Management Co. Ltd. 28-Feb Fidelity Management & Research Company 28-Feb Birla Sun Life Asset Management Company Ltd. 31-Mar UTI Asset Management Co. Ltd. 28-Feb Source: Reuters, ICICIdirect.com Research Shareholding Pattern (in %) Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Promoter FII DII Others Recent Activity Buys Sells Investor name Value Shares Investor name Value Shares The Vanguard Group, Inc Life Insurance Corporation of India Capital World Investors Invest AD BlackRock Institutional Trust Company, N.A Lyxor Asset Management SBI Funds Management Pvt. Ltd Thornburg Investment Management, Inc Motilal Oswal Asset Management Company Ltd T. Rowe Price International (UK) Ltd Source: Reuters, ICICIdirect.com Research ICICI Securities Ltd Retail Equity Research Page 9

10 Financial summary Profit and loss statement Crore (Year-end March) FY16 FY17E FY18E FY19E Total operating Income 57,746 67,968 80,533 93,858 Growth (%) Raw Material Expenses 38,780 46,640 55,437 64,564 Employee Expenses 1,989 2,331 2,763 3,221 Marketing Expenses Administrative Expenses Other expenses 7,999 8,694 10,264 11,962 Total Operating Expenditure 48,768 57,666 68,465 79,747 EBITDA 8,979 10,303 12,068 14,112 Growth (%) Depreciation 2,824 2,605 2,819 3,285 Interest Other Income 462 2,333 2,272 2,630 PBT 6,535 9,941 11,436 13,376 Others Total Tax 1,964 2,604 2,973 3,478 PAT 4,571 7,338 8,462 9,898 Growth (%) EPS ( ) Cash flow statement Crore (Year-end March) FY16 FY17E FY18E FY19E Profit after Tax 4,571 7,338 8,462 9,898 Add: Depreciation 2,824 2,605 2,819 3,285 (Inc)/dec in Current Assets -1, ,204-1,008 Inc/(dec) in CL and Provisions 2,427 1,535 2, Others CF from operating activities 8,766 11,227 11,873 12,954 (Inc)/dec in Investments 2,124-1, ,000 (Inc)/dec in Fixed Assets -2,457-3,372-4,500-4,500 Others -7,041-8,878-3,558-3,551 CF from investing activities -7,374-13,390-8,558-9,051 Issue/(Buy back) of Equity Inc/(dec) in loan funds Dividend paid & dividend tax -1,278-2,719-3,081-3,262 Inc/(dec) in Sec. premium Others -72 4, CF from financing activities -1,452 2,048-3,187-3,373 Net Cash flow Opening Cash Closing Cash Balance sheet Crore (Year-end March) FY16 FY17E FY18E FY19E Liabilities Equity Capital Reserve and Surplus 26,856 35,925 41,306 47,942 Total Shareholders funds 27,007 36,076 41,457 48,093 Total Debt Deferred Tax Liability Others Liabilties 424 1,127 1,167 1,207 Total Liabilities 27,983 38,151 43,562 50,218 Assets Gross Block 30,714 34,085 38,585 43,085 Less: Acc Depreciation 16,939 19,544 22,362 25,647 Net Block 13,775 14,542 16,223 17,438 Capital WIP Total Fixed Assets 13,775 14,542 16,223 17,438 Investments 17,786 28,228 32,228 36,728 Inventory 3,132 3,262 4,366 5,088 Debtors 1,299 1,199 1,812 2,112 Loans and Advances 1, ,346 1,569 Other Current Assets 250 1, Cash Total Current Assets 6,277 6,016 8,134 10,052 Creditors 7,013 8,367 9,267 10,286 Provisions 1, ,424 2,485 Other current Liabilities 2,365 3,931 3,853 3,552 Total Current Liabilities 11,213 12,748 15,544 16,322 Net Current Assets -4,936-6,732-7,410-6,270 Other Assets 1,359 1,627 1,735 1,836 Application of Funds 27,983 38,151 43,562 50,218 Key ratios (Year-end March) FY16 FY17E FY18E FY19E Per share data ( ) EPS Cash EPS BV , , ,592.1 DPS Cash Per Share Operating Ratios EBITDA Margin (%) PBIT / 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) FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E Amara Raja (AMARAJ) Hold Apollo Tyre (APOTYR) Buy Ashok Leyland (ASHLEY) Buy Bajaj Auto (BAAUTO) Hold Balkrishna Ind. (BALIND) Buy Bharat Forge (BHAFOR) Buy Bosch (MICO) Buy Eicher Motors (EICMOT) Buy Exide Industries (EXIIND) Buy Hero Mototcorp (HERHON) Hold JK Tyre & Ind (JKIND) Buy Mahindra CIE (MAHAUT) Buy Maruti Suzuki (MARUTI) Buy Motherson (MOTSUM) Hold Tata Motors (TELCO) 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 Analyst, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report. Terms & conditions and other disclosures: ICICI Securities Limited (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. 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