17 July 2018 RATING CMP Price Target Previous Target Potential Upside Stock Info 52wk Range H/L Mkt Capital (Rs Cr) Free float (%) Avg. Vol 1M (000) No. of Shares (Crore) Promoters Pledged % ACCUMULATE 162 180 205 11% 207/155 4,989 85% 1585 31 Key Highlights Among the small size private banks, DCB bank has the highest C/I ratio of 60% as on Q1 FY19. It has added 166 branches in last 3 years and has ended with 323 branches in the current quarter. Now slowing the pace of expansion will lead to lower opex growth and moreover with the maturity of older branches C/I ratio could improve significantly over FY20. Empolyee count during the quarter was approx 6000. IEA Report Industry Bloomberg BSE Code NSE Code NIM declines, advances growth picked-up BANKING DCBB IN 532772 DCBBANK DCB Bank is the fastest growing bank among the small size of banks. Its loan book has registered CAGR of 25% in last 5 years. The bank's target is mainly to focus on small business owners and small business segment i.e traders, shopkeepers, MSMEs and SMEs. On the other hand the bank have limited presence in the salaried segment. NIM is likely to remain under pressure due to high competitive pressure and increase in bond yield rates. Assets quality has remained stable with GNPA at sub 2% level since last 18 quarters. Well diversified loan book with focus of management on low ticket size gives comfort on assets quality front. However we remain cautious on agri loan book. 1Q FY19 Result: NII was in line with our expectation, but PAT estimate missed due to higher opex. Net interest income grew by 17% YoY which is the lowest since 12 quarters, led by increase in the cost of fund and lower NIM. Other income declined by 3% yoy due to lower treasury gain on account of rise in the bond yield. Operating profit grew by 4% only due to higher opex (+18% yoy). Operating expenses grew by 18% yoy driven by increase in the employee cost, which led rise of 5bps in C/I ratio to 60.3% as compared to 57.2% a year back. PAT increased by 7% YoY. Loan book grew by 31% YoY. Provisions declined by 6% on yoy basis. NIM declined by 33bps YoY to 3.90%. View and Valuation Rising bond yield and pricing pressure on loan assets have led to NIM under pressure. Cost of fund has started to rise for DCB bank whereas yield has also fallen. 40% of the loan book is mortgage loan which is highly competitive and hence facing pricing pressure from the peers. C/I ratio is still not showing any sign of improvement despite slow in branch addition. However assets quality remained stable with one of the best PCR (76%) in the industry. Loan book growth has remained healthy at 31%. We reduce our PAT estimate by 5% in both FY19 as well as in FY20 owing to NIM pressure and no improvement in C/I ratio. We cut our target multiple to 1.6x P/BV and reduce target price to Rs 180. Thus we change our recommendation from BUY to ACCUMULATE. Key Risks to our rating and target Slower pace of C/I reduction rate. Rising bond yield & aggressive competition from existing player will hurt the margins. FY16 FY17 FY18 FY19E FY20E NII 620 797 995 1137 1361 PPP 349 418 525 614 802 PAT 195 200 245 308 412 NIM % 3.7 3.9 3.9 3.5 3.4 EPS (Rs) 7 7 8 10 13 EPS growth (%) 0.9 2.3 13.8 25.4 33.8 ROE (%) 11.5 10.0 9.8 10.4 12.6 Research Analyst ROA (%) 1.1 0.9 0.9 0.9 1.0 DEEPAK KUMAR BV 63 77 91 100 112 Deepak.kumar@narnolia.com P/B (X) 1.3 2.2 1.8 1.6 1.4 P/E (x) 11.6 24.4 20.3 16.1 12.0 The views expressed above accurately reflect the personal views of the authors about the subject companies and its(their) securities. The authors have not and will not receive any compensation for providing a specific recommendation or view. Narnolia Financial Advisors Ltd and other Narnolia group companies does and seeks to do business with companies covered in its research reports. As a result investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. KEY FINANCIAL/VALUATIONS
1Q FY 19 Results In line Mixed Performance Financials Interest Inc. Interest Exp. NII Other Income Total Income Ope Exp. PPP Provisions PBT Tax Net Profit 1QFY18 2QFY18 3QFY18 4QFY18 1QFY19 YoY % QoQ% FY17 FY18 YoY % 566 587 611 649 701 23.9% 8.0% 2,076 2,413 16.2% 333 339 360 385 428 28.7% 11.1% 1,279 1,418 10.8% 233 248 250 264 273 17.1% 3.5% 797 995 24.9% 86 65 75 85 83-3.4% -2.4% 249 311 24.6% 319 313 325 349 356 11.6% 2.1% 1,047 1,306 24.8% 183 189 203 207 214 17.5% 3.6% 628 781 24.3% 136 124 123 142 141 3.7% -0.1% 418 525 25.5% 36 30 34 39 33-6.4% -14.4% 111 139 24.5% 101 94 88 103 108 7.2% 5.3% 307 386 25.9% 36 35 31 39 39 8.4% 0.3% 107 141 31.6% 65 59 57 64 70 6.6% 8.2% 200 245 22.9% NIM under pressure, C/I ratio increased. NIM dropped by 26 bps qoq to 3.90% due to decline in the yield on advances by 20 bps QoQ and rise in cost of fund. Yield on advances declined because its major segments mortgage and MSME has faced pricing pressure due to intensive competition in the market. However due to rise in G-sec bond yield by 150 bps, cost of fund has also increased by 7 bps QoQ during the quarter. We expect NIM to remain under little pressure due to increasing cost. C/I ratio increased by 87 bps during the quarter to 60% due to increase in operating expenses and increase in net income at a slower growth rate of 11% yoy (in 4FY18 it was 23%) driven by the higher interest expense growth of 29% yoy as against 17% a quarter back. Robust growth in advances as well as deposit. Advances grew by a healthy rate of 31% YoY and 5% QoQ. The growth was basically from the entire portfolio. Corporate book grew by 48% YoY. DCB bank largely focuses on mortgage finance which contributes 40% of the portfolio. This portfolio grew by 19% YoY during the quarter. AIB grew by 38% whereas commercial vehicle grew by 57% YoY led by healthy CV sales. SME portfolio grew by 42% YoY. Deposits also grew by 31% YoY in line with the advances. CASA growth was impacted sequentially and came down to 20% (from 25% a quarter back) due to lower saving deposit growth. However the CASA ratio improved by 30bps to 24.6% as against 24.3% on qoq basis supported by strong qoq growth in current deposits of 10% as against 3% in Q4FY18. Total retail deposits of the bank stood at 75% against 74% a quarter back. Slippages increased, but NNPA remained stable. Slippages ratio increased by 9 bps sequentially to 0.53%. GNPA ratio stood at 1.86% vs 1.79% a quarter back where as NNPA remained stable at 0.72%. The gross NPA in the AIB and MSME sector increased sequentially by 16% and 10% respectively. PCR remained stable at 76%. GNPA in AIB portfolio is a cause of concern which grew by 16% sequentially in absolute terms whereas MSME portfolio grew by 10%. On the other hand mortgages and corporate book NPA also grew by 6% and 7% respectively. Security receipt came down from 70 cr to 52 cr as management has been able to recover the amount and it largely represents MSE and mortgage loan. The restructured book was at Rs 231 cr in Q1FY19. Other highlights: CAR ratio during the quarter declined by 9 bps to 15.6%. Tier I ratio stood at 12% (as against 12.7% in Q4FY18), while tier II ratio stood at 3.5% (3.8% a quarter back). Concall Highlights : As per RBI if the overall exposure is not more than Rs 25 cr the bank may not recognize it as NPA, but the bank have let 30-33 cr as NPA instead of giving time to the customer and it is included in the 400 cr of NPA. MTM losses of Rs 2.6 Cr fully have been provided during 1Q FY19. Restructured assets was at Rs 231 Cr. SR book has declined from Rs 70 Cr to Rs 52 Cr as management has been able to recover the amount. Most of the SR are in SME and mortgage loan. Yield declined due to competitive pressure in mortgage, SME and vehicle loan book. Management guided for NIM of 3.7%-3.8%. Most of the book is linked to 3 months MCLR whereas CV, tractor etc is linked with fixed rate.
12.2 7.3 12.0 7.2 12.0 6.9 12.0 7.0 11.7 6.6 11.4 6.5 11.3 6.4 11.4 6.5 11.2 6.6 Profitability Matrix C/I Ratio % Empl. Cost/ Tot. Exp. % Other Exp/Tot. Exp.% Provision/PPP % Tax Rate % Int Exp./Int Inc. (%) Other Inc./Net Inc. % PAT/ Net Income % RoE % RoA % 3QFY17 4QFY17 1QFY18 2QFY18 3QFY18 4QFY18 1QFY19 YoY (+/-) QoQ (+/-) 60.1 59.4 57.2 60.3 62.3 59.4 60.3 3.02 0.87 48.1 48.4 49.6 48.7 47.8 49.1 50.7 1.11 1.56 51.9 51.6 50.4 51.3 52.2 50.9 49.3-1.11-1.56 27.9 29.4 26.0 24.3 28.0 27.4 23.5-2.53-3.91 34.8 35.1 35.4 37.5 35.4 37.5 35.8 0.38-1.77 61.9 59.9 58.8 57.7 59.0 59.4 61.1 2.27 1.70 24.5 23.4 22.4 26.9 20.8 23.0 24.3 1.94 1.32 18.8 18.6 20.4 18.8 17.5 18.4 19.5-0.91 1.11 10.7 10.0 10.7 8.8 9.3 10.2 10.8 0.02 0.55 0.9 0.9 1.1 0.9 0.9 0.9 0.9-0.16-0.01 Margin Performance Margin % 3QFY17 4QFY17 1QFY18 2QFY18 3QFY18 4QFY18 1QFY19 YoY (+/-) QoQ (+/-) Yield on Advances 12.0 12.0 11.7 11.4 11.3 11.4 11.2-0.45-0.20 Cost Of Funds 6.9 7.0 6.6 6.5 6.4 6.5 6.6-0.03 0.07 NIM 4.2 4.2 4.2 4.3 4.2 4.2 3.9-0.34-0.26 Exhibit: Yield and Cost Yield decreased, whereas Cost of fund expanded during the quarter. Exhibit: Net Interest Margin NIM declined sequentially and remained under pressure. Avg. Yield on Advances Avg. Cost of Funds Avg. NIM 4.1 4.0 4.2 4.2 4.1 4.2 4.0 4.0 3.9 Other Income Break Up- Decline in fee income. 1QFY17 2QFY17 3QFY17 4QFY17 1QFY18 2QFY18 3QFY18 4QFY18 1QFY19 Commission, exchange and brokerage Profit on Exchange Transactions Total Fee Income Profit on Sale of Investment Miscellaneous Income Other Income 38 42 40 45 52 48 57 63 60 3 4 2 1 3 4 4 4 5 41 46 43 46 55 52 60 67 65 17 12 13 4 29 7 6 4 15 2 4 9 13 2 6 9 14 3 60 62 64 64 86 65 75 85 83
13,337 14,436 14,584 15,818 16,266 17,395 18,595 20,337 21,243 15,680 17,685 18,840 19,289 19,155 20,567 21,296 24,007 25,032 50.3 49.7 49.5 50.5 48.1 51.9 48.4 51.6 49.6 50.4 48.7 51.3 47.8 52.2 49.1 50.9 50.7 49.3 19.8 19.2 18.8 18.6 20.4 18.8 17.5 18.4 19.5 Exhibit: Fee Income/Advances % Exhibit: Other Income/ Total Income % Fee based income declined sequentially Growth in other income shrunk Fee Income/Advances % Other Income/Total Net Income % 0.31 0.32 0.29 0.29 0.34 0.30 0.32 0.33 0.31 0.45 0.43 0.44 0.40 0.53 0.38 0.40 0.42 0.39 Exhibit: Opex Trend Elevated C/I Ratio Exhibit: Profitability trend Growth increase Empl. Cost/ Tot. Exp. % Other Exp/Tot. Exp. C/I Ratio % 60.9 60.0 60.1 59.4 60.3 62.3 57.2 59.4 60.3 PAT/ Net Income % Operating Profit Growth YoY % 47.2 29.7 18.9 23.4 12.2 22.8 3.4 3.7 Exhibit: Advances performance Healthy growth continues Exhibit: Deposits trend Spike in deposits Net Advances (Rs in Cr) Adv. Growth YoY % Deposits (Rs in Cr) Growth YoY % 27.9 29.1 24.3 22.4 22.0 20.5 27.5 28.6 30.6 18.2 30.4 33.8 29.2 22.2 16.3 13.0 24.5 30.7
1.72 1.75 1.55 0.74 1.59 1.74 1.80 1.89 1.79 0.72 1.86 0.72 0.87 0.84 0.79 0.92 0.90 0.87 23.1 21.9 25.9 24.3 26.9 25.9 25.7 24.3 24.6 Exhibit: Advances breakup Diversified Exhibit: CASA CASA ratio increased 2.0 2.0 3.0 6.0 CASA % CASA Growth YoY % 12.0 40.0 51.4 34.4 42.1 37.4 17.0 18.0 18.4 18.6 12.2 24.5 19.9 Mortgages AIB Corporate Banking SME + MSME Gold Loans Construction Finance Commercial Vehicle Others (PL, Auto, Others) Asset Quality GNPA (Rs in Cr) GNPA % NNPA (Rs in Cr) NNPA % Slippages (Rs in Cr) Specific PCR % 3QFY17 4QFY17 1QFY18 2QFY18 3QFY18 4QFY18 1QFY19 YoY (+/-) QoQ (+/-) 228 254 285 316 355 369 401 41% 9% 1.6 1.6 1.7 1.8 1.9 1.8 1.9 0.12 0.07 108 124 149 157 162 147 154 3% 5% 0.7 0.8 0.9 0.9 0.9 0.7 0.7-0.20 0.00 79 74 89 78 104 81 107 21% 32% 75.6 73.8 71.8 72.0 73.4 75.7 76.1 6% 0% GNPA Composition (Rs in Cr) 1QFY17 2QFY17 3QFY17 4QFY17 1QFY18 2QFY18 3QFY18 4QFY18 1QFY19 Mortgages 63 74 67 72 100 116 127 139 148 AIB 40 38 32 37 51 56 63 63 73 Corporate 86 86 65 86 68 68 84 84 90 SME+MSME 28 37 37 32 32 33 37 31 34 Gold Loans 3 6 6 2 7 6 7 11 11 CV/CE/STVL 11 13 18 20 22 29 28 30 32 Personal Loan 0 0 0 0 0 0 0 0 0 Others 0 2 4 5 7 8 8 11 13 Exhibit: Assets Quality Assets quality declined Exhibit: Provisions/Advances Reduction in credit cost GNPA % NNPA % PCR % Provisions/Avg. Advances % (Annualised) 75.3 75.4 75.6 73.8 71.8 72.0 73.4 75.7 76.1 0.6 0.8 0.8 0.9 0.9 0.7 0.8 0.8 0.6
Financial Details Balance Sheet Y/E March FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E Share Capital 250 250 282 284 285 308 308 308 >> Equity Capital 250 250 282 284 285 308 308 308 >> Preference Capital - - - - - - - - Reserves & Surplus 753 904 1,307 1,508 1,920 2,500 2,500 2,780 Networth 1,003 1,154 1,589 1,792 2,205 2,808 3,088 3,463 Deposits 8,364 10,325 12,609 14,926 19,289 24,007 30,263 37,829 32.0 23.5 22.1 18.4 29.2 24.5 26.1 25.0 >> CASA Deposits 2,272 2,581 2,950 3,490 4,689 5,840 7,566 9,760 11.6 13.6 14.3 18.3 34.4 24.5 29.5 29.0 Borrowings 1,526 860 1,164 1,148 1,276 1,927 2,330 2,913 Other Liabilities & Provisions 386 584 771 1,252 1,276 1,481 2,181 2,726 Total Liabilities 11,279 12,923 16,132 19,119 24,046 30,222 37,582 46,555 Cash & Bank 883 690 719 892 1,192 2,372 2,706 3,064 Investments 3,359 3,634 3,962 4,333 5,818 6,219 7,868 9,835 33.4 8.2 9.0 9.4 34.3 6.9 26.5 25.0 Advances 6,586 8,140 10,465 12,921 15,818 20,337 25,421 31,776 24.6 23.6 28.6 23.5 22.4 28.6 25.0 25.0 Fixed Assets 239 239 237 248 489 494 519 545 Other Assets 211 221 749 724 730 800 1,068 1,335 Total Assets 11,279 12,923 16,132 19,119 24,046 30,222 37,582 46,555 Income Statement Y/E March FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E Interest income 916 1,128 1,422 1,698 2,076 2,413 3,081 3,905 Interest expended 632 760 914 1,079 1,279 1,418 1,943 2,544 Net Interest Income 284 368 508 620 797 995 1,137 1,361 24.9 29.5 38.0 21.9 28.7 24.9 14.3 19.7 Other Income 117 139 166 220 249 311 359 454 13.9 18.5 19.5 33.0 13.1 24.6 15.4 26.6 >> Core Fee Income 89 101 119 152 176 234 288 362 >> Treasury Income 14 22 28 42 45 46 39 54 >> Others 14 16 19 26 28 32 32 39 Total Net Income 401 507 674 840 1,047 1,306 1,496 1,815 Operating Expenses 275 319 396 491 628 781 882 1,013 11.6 15.9 24.3 23.8 28.0 24.3 12.9 14.8 >> Employee Expenses 138 157 196 245 308 381 447 508 Pre-provisioning Profit 126 188 277 349 418 525 614 802 50.5 49.0 47.6 25.8 19.8 25.5 17.0 30.7 Provisions 24 37 69 88 111 139 139 169 (16.3) 52.1 89.8 26.6 26.8 24.5 0.3 21.2 PBT 102 151 208 261 307 386 475 633 Tax - - 17 67 107 141 167 222 Profit After Tax 102 151 191 195 200 245 308 412 85.3 48.3 26.3 1.7 2.7 22.9 25.4 33.8
Financial Details Key Ratios Y/E March FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E Balance Sheet Metrics Loan Growth (%) 24.6 23.6 28.6 23.5 22.4 28.6 25.0 25.0 Deposit Growth (%) 32.0 23.5 22.1 18.4 29.2 24.5 26.1 25.0 C/D Ratio (%) 78.7 78.8 83.0 86.6 82.0 84.7 84.0 84.0 CASA (%) 27.2 25.0 23.4 23.4 24.3 24.3 25.0 25.8 Investment/Deposit (%) 40.2 35.2 31.4 29.0 30.2 25.9 26.0 26.0 CRAR (%) 13.6 13.7 15.0 14.1 13.8 16.5 14.4 12.8 >> Tier 1 (%) 12.6 12.9 14.2 12.8 11.9 12.7 11.3 10.3 >> Tier 2 (%) 1.0 0.9 0.7 1.3 1.9 3.8 3.1 2.5 Assets Quality Metrics Gross NPA Gross NAP (%) Net NPA Net NPA (%) Slippges (%) Provision Coverage (%) Provision/Average Advances (%) 215 139 186 197 254 369 475 608 3.2 1.7 1.8 1.5 1.6 1.8 1.8 1.9 49 74 106 98 124 147 181 213 0.8 0.9 1.0 0.8 0.8 0.7 0.7 0.7 - - 2.2 2.2 2.0 2.2 1.9 1.7 77.2 46.6 43.2 50.6 51.0 60.2 62.0 65.0 0.4 0.5 0.7 0.8 0.8 0.8 0.6 0.6 Margin Metrics Yield On Advances (%) Yield On Investment (%) Yield on Earning Assets (%) Cost Of Deposits (%) Cost Of Funds (%) Spread (%) NIM (%) 12.0 11.8 11.8 11.6 11.5 10.7 10.9 11.1 6.7 7.0 7.4 7.4 7.8 7.0 7.4 7.5 9.8 9.9 10.4 10.3 10.3 9.5 9.6 9.8 7.3 7.1 7.3 7.3 6.9 6.0 6.5 6.8 7.0 7.0 7.0 6.9 6.6 5.8 6.4 6.6 2.8 3.0 3.4 3.4 3.6 3.6 3.3 3.1 3.0 3.2 3.7 3.7 3.9 3.9 3.5 3.4 Profitability & Effeciency Metrics Int. Expense/Int.Income (%) 69.0 67.3 64.3 63.5 61.6 58.7 63.1 65.1 Fee Income/NII (%) 31.4 27.4 23.5 24.5 22.1 23.5 25.4 26.6 Cost to Income (%) 68.6 62.9 58.8 58.4 60.0 59.8 59.0 55.8 Cost on Average Assets (%) 3.0 2.8 2.9 3.0 3.1 3.1 2.8 2.5 Tax Rate (%) - - 8.1 25.5 34.9 36.5 35.2 35.0 Valuation Ratio Metrics EPS (Rs) ROAE (%) ROAA (%) Dividend Payout (%) Dividend yield (%) Book Value (Rs) P/B (X) P/E (X) 4 6 7 7 7 8 10 13 78.3 48.2 12.1 0.9 2.3 13.8 25.4 33.8 10.9 14.0 13.9 11.5 10.0 9.8 10.4 12.6 1.0 1.3 1.3 1.1 0.9 0.9 0.9 1.0 - - - - 7.1 9.4 10.0 9.4 - - - - 0.3 0.5 0.6 0.8 40 46 56 63 77 91 100 112 12.1 14.9 22.2 11.9 22.6 18.0 10.0 12.1 0.2 0.3 2.0 1.3 2.2 1.8 1.6 1.4 2.1 2.0 16.4 11.6 24.4 20.3 16.1 12.0
Exhibit: DuPont Analysis Interest Income Interest expended Net Interest Income Non-Fund Based Income >> Core Fee Income >> Trading and Other Income Core Operating Income Total Income Total Operating Expenses >> Employee Expenses >> Other Expenses Operating Profit Provisions Others PBT Tax PAT/RoA >> Equity Multiplier (x) RoE Financial Details FY14 FY15 FY16 FY17 FY18 FY19E FY20E 9.3 9.8 9.6 9.6 8.9 9.1 9.3 6.3 6.3 6.1 5.9 5.2 5.7 6.0 3.0 3.5 3.5 3.7 3.7 3.4 3.2 1.1 1.1 1.3 1.2 1.1 1.1 1.1 0.8 0.8 0.9 0.8 0.9 0.9 0.9 0.3 0.3 0.4 0.3 0.3 0.2 0.2 3.9 4.3 4.4 4.5 4.5 4.2 4.1 4.2 4.6 4.8 4.8 4.8 4.4 4.3 2.6 2.7 2.8 2.9 2.9 2.6 2.4 1.3 1.3 1.4 1.4 1.4 1.3 1.2 1.3 1.4 1.4 1.5 1.5 1.3 1.2 1.6 1.9 2.0 1.9 1.9 1.8 1.9 0.3 0.5 0.5 0.5 0.5 0.4 0.4 - - - - - - - 1.3 1.4 1.5 1.4 1.4 1.4 1.5-0.1 0.4 0.5 0.5 0.5 0.5 1.3 1.3 1.1 0.9 0.9 0.9 1.0 11.2 10.6 10.4 10.8 10.8 11.5 12.8 14.0 13.9 11.5 10.0 9.8 10.4 12.6
Disclosures: The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations). (Formerly Microsec Capital Ltd) (MCL) is a SEBI Registered Research Analyst having registration no. INH300002407. MCL, the Research Entity (RE) as defined in the Regulations, is engaged in the business of providing Stock broking services, Depository participant services, Merchant Banking, Portfolio Management & distribution of various financial products. MCL is a subsidiary company of G Raj & Company Consultants Ltd. (GRaj). MCL is registered with the Securities & Exchange Board of India (SEBI) and is a registered Trading Member with National Stock Exchange of India Ltd. (NSE), Bombay Stock Exchange Limited (BSE) and Metropolitan Stock Exchange Of India Ltd. (MSEI) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) & National Securities Depository Limited (NSDL) and is member of Association of Mutual Funds of India (AMFI) for distribution of financial products. MCL is also SEBI registered Category 1 Merchant Banker & Portfolio Manager. Details of associate entities of MCL is available on the website at www.narnolia.com No penalties have been levied on MCL by any Regulatory/Statutory authority. MCL, it s associates, Research Analyst or their relative may have any financial interest in the subject company. MCL and/or its associates and/or Research Analyst may have beneficial ownership of 1% or more securities in the subject company at the end of the month immediately preceding the date of publication of the Research Report. MCL and its associate company(ies), their directors and Research Analyst 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 associates of MCL even though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report. Research Analyst may have served as director/officer, etc. in the subject company in the last 12 month period. MCL and/or its associates may have received any compensation from the subject company in the past 12 months. In the last 12 months period ending on the last day of the month immediately preceding the date of publication of this research report, MCL or any of its associates may have: a) managed or co-managed public offering of securities from subject company of this research report, b) received compensation for investment banking or merchant banking or brokerage services from subject company of this research report, c) received compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company of this research report. d) Subject Company may have been a client of MCL or its associates during twelve months preceding the date of distribution of the research report. MCL 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. MCL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report should be aware that MCL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions. Terms & Conditions: This report has been prepared by MCL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of MCL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty, representation of warranty, express or implied, is made as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice. The report is prepared solely for informational purpose and does not constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MCL will not treat recipients as customers by virtue of their receiving this report. 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. Disclosure of Interest Statement Companies where there is interest Analyst s ownership of the stocks mentioned NIL A graph of daily closing prices of securities is available at www.nseindia.com, www.bseindia.com. Research Analyst s views on Subject Company may vary based on Fundamental research and Technical Research. Proprietary trading desk of MCL or its associates maintains arm s length distance with Research Team as all the activities are segregated from MCL research activity and therefore it can have an independent view with regards to subject company for which Research Team have expressed their views. 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 MCL & its group companies to registration or licensing requirements within such jurisdictions.
Disclaimer: The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. Certain transactions -including those involving futures, options, another derivative products as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of the information and opinions contained in this document. This information is subject to change without any prior notice. The Company reserves the right to make modifications and alternations to this statement as may be required from time to time without any prior approval. MCL, its associates, their directors and the employees may from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. The views expressed are those of the analyst, and the Company may or may not subscribe to all the views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject MCL to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sell in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits or lost opportunities that may arise from or in connection with the use of the information. The person accessing this information specifically agrees to exempt MCL or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MCL or any of its affiliates or employees responsible for any such misuse and further agrees to hold MCL 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. Correspondence Office Address: Arch Waterfront, 5th Floor, Block GP, Saltlake, Sector 5, Kolkata 700 091; Tel No.: 033-40541700; www.narnolia.com. Registered Office Address: Shivam Chambers, 1st Floor, 53, Syed Amir Ali Avenue, Kolkata 700 091. Compliance Officer: Manish Kr Agarwal, Email Id: mkagarwal@narnolia.com, Contact No.:033-4054 1766. Registration details Company & Group entities: MCL: SEBI Registration: INZ000166737 (BSE/NSE/MSE); CDSL: IN-DP-424-2007; NSDL: IN-DP- NSDL-245-2005; Research Analyst: INH300002407, Merchant Banking: (Registration No.: INM000010791), PMS: (Registration No.: INP000002304), AMFI: ARN 3087 SEBI Registration: BSE Broker INZ260010731; NSDL DP: IN-DP-NSDL-371-2014 G. Raj & Company Consultants Ltd (G RAJ), MCX/NCDEX Commodities Broker: INZ000051636 Microsec Commerze Limited, PMS: INP000005109Narnolia Velox Advisory Ltd., Investment Adviser: INA300005439 Eastwind Capital Advisors Pvt Ltd. (EASTWIND),IRDA License No.134 (Microsec Insurance Brokers Limited), AMFI: ARN 20558, PFRDA NPS POP: 35012016 Narnolia Securities Ltd. (NSL), RBI Registered NBFC:B.05.02568 Narnolia Capital Advisors Pvt. Ltd.