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IEA Report

10th Jan 2017


AUROPHARMA

"HOLD"

10th Jan 2017

Post this acquisition ARBP will jump from current 11th position in Portugal market to no. 1 player and becomes part of the top-10 generic company
in EU (from no 13 earlier). For Aurobindo the Europe push comes amid Aurobindos successful turnaround of the money-losing Western European
commercial operations of Irish drug maker Actavis Plc, which it bought for 30 million Euros in 2014. Considering fruitful synergy benefits coming
out of this deal, we maintain HOLD rating in this stock. ........................ ( Page : 2-3)

BEML

10th Jan 2017

" BOOK PROFIT"

Government will sell 26 percent stake in defence equipment manufacturer BEML, making it the first major PSU to be sold through strategic
disinvestment, which may fetch the exchequer over Rs 1,000 crore. With this stake sale, the government's shareholding will be reduced to 28%.This
divestment may be positive for BEML as a company. BEML has been suffering because of lack of technological advancement. This step may lead to
less government control in companys affair and can boost efficiency in the long term. Though, with the current news of Government divesting
stake, we assume that the stock price movement will be depend more on news flow around the stake sale and less on Financials. We recommend
"Book Profit" at current levels. ....................................... ( Page : 4-7)

VINATIORGA

"Neutral"

9th Jan 2017

We expect that the company to maintain its leadership position in IBB and ATBS along with its increasing product basket could able to cater to the
growing needs of specialty chemicals industry which in turn to drive revenue. A well experienced and able management coupled along with good
growth in the ATBS segment driven by demand in the water treatment segment projects a positive outlook for the company. The company
currently trades at a P/E of 14x FY18E EPS and P/B of 4.6 x FY18 book value. We Initiate Coverage on the stock . Presently we rate it as 'Neutral' due
to its stretch valuation. Our price target on the stock is Rs 659 rating it as P/B of 3.7 on FY19e. ............................................. ( Page : 8-21)

KEC

"Hold"

6th Jan 2017

In short run, companys revenue growth will remain lackluster but medium to long-term growth remains intact. Efficient working capital
management strengthened balance sheet position and we expect it to continue going forward. We expect to ramp up in an execution of substation
(T&D) projects and railway projects. Robust opportunity in railway segment with improving margin will help KEC to post healthy numbers going
forward. But considering the short-term uncertainty, we maintain HOLD on the stock with unchanged target price of Rs. 164.
......................................................... ( Page : 22-24)

M&M

"BUY"

5th Jan 2017

Management believes that the demonetization issue may have short term negative impact on Farm Equipment segment. They expect this concern
will last for next 4 months but sticks with previous growth guidance of 20% for tractor industry in FY17. We believe that the tractor industry may
not see much slow-down because the monsoon was good during the year and almost 90% of the tractors are financed. New launches in 2HFY18 in
Tractor and SUV segments will make the Mahindras presence further stronger in the domestic market. Ssangyong have also seen recovery on nine
month basis and it may post positive results in the current fiscal after three consecutive years of losses. Considering the strong volume growth and
recovery in the non- performing business we recommend 'BUY' with a target price of Rs.1600. ............................................... ( Page : 25-27)

MARUTI

"BUY"

3rd Jan 2017

We expect current demonetization issue may not be impacting much in the long run to the passenger vehicle segment because more than 75%
vehicles are financed. But this issue may be hampering sales in near future due to cash crunch in the economy. We assume volumes in the second
half may be down by 10% in comparison to the first half 2017. Higher sales of premium segment cars will further increase the realization per car,
which will in turn maintain the margins going ahead despite the rising commodity prices. Hence we have positive view on this stock and we
recommend "BUY" with a target price of Rs.6100. .................................... ( Page : 28-30)

IRB

2nd Jan 2017

"ACCUMULATE"

Firstly EPC revenue was impacted due to heavy monsoon during Q2FY17 and secondly suspension of toll collection for the period of 24 days
because of demonetization will affect the top line of the company in FY17. We expect top line of Rs. 5627 Cr (Growth of 10% YoY) with healthy
52.7% EBITDA margin in FY17E. Significant reduction in debt post the InvIT IPO and an arbitral award will boost the bottom line of the company. At
a current price of Rs. 191 stock trades at 7.3x to FY17 expected EV/EBITDA and 1.3x to P/B. The stock has corrected nearly 18% post demonetization
announcement which makes this stock attractive at this price with present fundamentals. Hence, we revised our rating from HOLD to ACCUMULATE
with target price of Rs.235 . ............................................ ( Page : 31-33)
Narnolia Securities Ltd

IEA Edition No.-

924

HOLD

AUROBINDO PHARMA LTD

10-Jan-17

Company Update
CMP

694

Target Price

890

Previous Target Price

890

Upside

28%

Change from Previous

0%

Market Data
BSE Code

524804

NSE Symbol

AUROPHARMA
895/582
40645
138.1
8236.1

52wk Range H/L


Mkt Capital (Rs Cr)
Av. Volume(,000)
Nifty

Stock Performance
1M

3M

12M

Absolute

-3.3

-19.9

-9.2

Rel.to Nifty

-3.5

-26.3

-12.4

Promoters
Public
DII
Total

Post this acquisition ARBP will jump from current 11th position in Portugal
market to no. 1 player and becomes part of the top-10 generic company in
EU (from no 13 earlier). For Aurobindo the Europe push comes amid
Aurobindos successful turnaround of the money-losing Western European
commercial operations of Irish drug maker Actavis Plc, which it bought for
30 million Euros in 2014. Considering fruitful synergy benefits coming out of
this deal, we maintain HOLD rating in this stock.

1QFY17 4QFY16

53.79
46.21

53.79
46.21

53.9

This deal will be funded through Term loan taken in Euro.

46.1

100

100

100

Generics business will give the synergy benefits immediately.


The estimated goodwill of Generics is ~ Rs. 8 Cr
ARBP will have the largest generic product portfolio consisting of 271
products.
In overall generics market there is no price drop at this point of time, there
prices are stable.

Company Vs NIFTY
115

Outlook

Current concall Highlights on Acquisition

Share Holding Pattern-%


2QFY17

Aurobindo Pharma has announced the signing of a binding agreement


through its wholly owned subsidiary (Agile Pharma B.V.) to acquire Generis
Farmaceutica S.A (involves in manufacturing and sale of pharmaceutical
products in Portugal).The total consideration for the acquisition is ~ Rs.968
Cr. This acquisition cost will be funded through Term loan in Euro. This
acquisition includes manufacturing facility in Amadora (Portugal) which has
the capacity to manufacture 1.2 bn tablets/capsules/sachets annually. With
this ARBP will have its first formulations plant in EU. Existing capacity
utilization is at ~50%. Portugal has pharma market size of 3.4 bn with
generic penetration in volume at ~30% significantly below EU average of
~53% and US average of ~80%. Management expects synergy benefits
coming out from FY18E.

AUROPHARMA

NIFTY

110

The generics market in Portugal market is ~ $600mn.

105

51 products are pending in pipeline.

100

ARBP is going to launch 39 products going ahead.

95

Financials

2012

2013

2014

2015

Rs,Cr
2016

Sales
EBITDA
Net Profit
EPS
ROCE

4627
561
-124
-4
11%

5855
861
294
10
16%

8100
2132
1173
40
36%

12121
2564
1576
54
34%

13896
3206
1982
34
36%

90
85
80

Jan-17

Dec-16

Oct-16

Nov-16

Sep-16

Jul-16

Aug-16

Jun-16

Apr-16

May-16

Feb-16

Mar-16

Jan-16

75

Aditya Gupta
aditya.gupta@narnolia.com

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

Revenue
Other Income
Total Revenue
COGS
GM
Other Expenses
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
PBT
Tax
Tax Rate (%)
Reported PAT
Dividend Paid
No. of Shares

Financials Snap Shot


INCOME STATEMENT
FY13
FY14
FY15
FY16
5855
8100
12121
13896
EPS
29
23
97
68
Book Value
5884
8123
12217
13964
DPS
2,991
3,606
5,506
6,158
Payout (incl. Div. Tax.)
49%
55%
55%
56%
P/E
1,340
1,530
2,749
2,982
Valuation(x)
861
2132
2564
3206
Price / Book Value
15%
26%
21%
23%
Dividend Yield (%)
249
313
333
393
RoE
612
1,819
2,231
2,813
Profitability Ratios
267
310
160
159
RoCE
374
1,533
2,168
2,722
Asset Turnover (x)
83
363
597
744
Turnover Ratios
22%
24%
28%
27%
Debtors (No. of Days)
294
1173
1576
1982
Inventory (No. of Days)
67
60
179
359
Creditors (No. of Days)
29
29
29
58
Net Debt/Equity (x)

Share Capital
Reserves and surplus
Shareholders' funds
Long term Debt
Total Borrowings
Non Current liabilities
Long term provisions
Short term Provisions
Current liabilities
Total liabilities
Net Fixed Assets
Non Current
Investments
Other
non Current assets
Current assets
Total Assets

FY13
29
2,577
2,606
1,148
3,384
77
9
80
1,195
7,273
2,857
22
19
4,137
7,273

BALANCE SHEET
FY14
FY15
29
29
3,721
5,127
3,750
5,156
1,279
1,361
3,634
3,864
215
235
9
24
127
218
1,865
3,634
9,490 12,914
3,031
4,061
20
0
18
30
5,631
8,299
9,490 12,914

FY16
29
6,958
6,987
1,368
3,883
242
31
240
3,543
14,681
4,115
0
30
10,035
14,681

FY13
10
89
2
0
14.46
2
2%
11%

RATIOS
FY14
FY15
40
54
129
12
2
76
0
2
12.71
22.64
15
4
7
0%
1%
31%
31%

16%
1

36%
1

34%
1

34%
1

100
120
60
0.44

119
107
61
0.34

107
109
62
0.26

107
109
63
0.20

CASH FLOW STATEMENT


FY13
FY14
FY15
OP/(Loss) before Tax
374
1,533
2,168
Depreciation
249
313
333
Direct Taxes Paid
119
344
597
Operating profit before
819
2,047
2,644
working
capital
CF
from Op.
Activity
275
646
1,797
Capital expenditure on
(273)
(390) (1,362)
fixed
assets
including
CF
from
Inv. Activity
(246)
(819) (1,426)
Proceeds from long180
147
82
term borrowings
Repayment
of Long Term Borrowings
(523)
(51)
Interest Paid
(112)
(94)
(144)
Divd Paid (incl Tax)
(67)
(60)
(179)
CF from Fin. Activity
108
118
(94)
Inc/(Dec) in Cash
137
(55)
277
Add: Opening Balance
66
203
179
Closing Balance
203
148
455

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

FY16
69
11
84
0
17.81
12
5
0%
29%

FY16
2,670
427
667
3,290
871
(481)
(481)
7
(193)
(171)
(345)
46
469
515

BOOK PROFIT
BEML LTD.

10-Jan-17

Result Update
CMP
Target Price
Previous Target Price
Upside
Change from Previous

View & Recommendation


1158
1240
7%
-

Market Data
BSE Code
NSE Symbol
52wk Range H/L
Mkt Capital (Rs Cr)
Av. Volume
Nifty

500048
BEML
1247.20/770.15
4,821
355
8236

Stock Performance
Absolute
Rel.to Nifty

Government will sell 26 percent stake in defence equipment manufacturer


BEML, making it the first major PSU to be sold through strategic
disinvestment, which may fetch the exchequer over Rs 1,000 crore. With this
stake sale, the government's shareholding will be reduced to 28%.This
divestment may be positive for BEML as a company. BEML has been
suffering because of lack of technological advancement. This step may lead
to less government control in companys affair and can boost efficiency in the
long term. Though, with the current news of Government divesting stake, we
assume that the stock price movement will be depend more on news flow
around the stake sale and less on Financials. We recommend "Book Profit"
at current levels.

Recent management commentaries

1Month

1Year

YTD

9.6
8.7

4.4
-4.4

-2.1
2.5

As per the management company would be looking to double its revenue to


over Rs 6000 Cr by 2020 and Rs 3500 Cr in FY17.
Order book is roughly about Rs 7300cr in FY17.
Management expects Mining segment will improve in FY18E and expects
almost another Rs 800-1,000 Cr worth of mining orders.

Share Holding Pattern-%


2QFY17 1QFY17

In Defence segment, lots of opportunities are coming. Management assures

4QFY16

Promoter

54.03

54.03

54.03

Public

45.97

45.97

45.97

--

--

--

100

100

100

Others
Total

Company Vs NIFTY
120

BEML

NIFTY

110

that this particular sector will take huge jump in near future. In Defence front

order inflow will be double in FY17 as compare to FY16, these would all be in
the vehicle space, the mine systems, the missile systems, the other vehicles,
etc.

In Metro segment company is having order book roughly about Rs 2000 Cr


out of which Rs 1000 Cr will execute in FY17 and rest Rs 1000 Cr will be
executing in FY18E. In FY18E company is having another order worth Rs
2400 Cr. So, total order book in Metro is Rs 3500 Cr in FY18E.
There are a lot of options and opportunities that are going to emerge.

Company have a big special economic zone (SEZ) land in Bangalore so they

100

90
80
70
60
50

Bibha Kashyap
bibha.kashyap@narnolia.com

are already poised. They will wait for the opportunities and talking to a lot of
partners as well.
Rs in Cr
Financials
FY13
FY14
FY15
FY16
FY17E
Sales
2801
2904
2802
2978
2620
EBITDA
-49
115
70
129
156
Net Profit
-83
6
6
53
54
EBIDTA%
-1.7%
4.0%
2.5%
4.3%
6.0%
P/E
0.0
0.0
0.0
0.0
0.0
Narnolia Securities Ltd
Please refer to the Disclaimers at the end of this Report

Order book position:


8000

5933

5422

14000

7261

7016

7000
6000

Manpower in nos:

6050

11798 11644

12000

6314

11005

5686

10328

9599

10000

5000

8827

8348

8000

4000

3000

6000

2000

4000

1000

2000

FY11

FY12

FY13

FY14

FY15

Order book in Crs

FY16 30 Nov'
16

FY11

FY12

FY13

FY14

FY15

FY16 30 Nov'
16

Manpower in nos.

Trend of Gross margin and EBITDA margin:

Gross Margin %

EBIDTA %
0.75

0.80
0.66

0.70
0.60

0.50
0.40

0.52 0.50 0.13

0.47

0.40 0.43
0.05 0.06 0.37
0.35
0.01 (0.00)

0.30

0.40
0.01

0.37
(0.01)

(0.07)

0.20

0.18
0.47

0.50

0.37
0.02

(0.00)

(0.09)

(0.13)

0.10
-

(0.25)

0.20
0.15
0.10
0.05
(0.05)
(0.10)
(0.15)
(0.20)
(0.25)
(0.30)

Trend of Net sales and PAT:


Net Sales(Cr)
169

155

64
-11

-24

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

454

-115

346

1009

764

577

451

502

780

783

-68

-96

751

-30

-55

590

-39

676

1279

-26

598

1400
1200
1000
800
600
400
200
0

PAT (Cr)
200
150
100
50
0
-50
-100
-150

Trend of Employee benefit and Other expenses:


Employee benefit Expence % as Sales

Other expenses % as Sales

60%

52%

50%
40%

38%

41%

25%

30%

39%
32%

31%
24%

19%

28%

25%
18%

16%

20%
10%

32%

39%

36%

24%

15%

15%

14%

0%

10%

13%

18%

16%

12%

13%

10%

11%

Investment Arguments:
The approval for Tatra trucks has come through with delivery commencing from August 2015. The
order backlog of ~Rs11bn-12bn from Tatra is likely to get executed in 18-24 months. which will help
improve profitability of BEMLs defence business for FY16 &FY17.
All the three segments have done well especially on the defence side it is very good. It is very
satisfied and defence for the future is going to be much more exciting because of Make in India
campaign where management is expecting exciting opportunities, which are already up and running.
That should go very well in FY16-FY17.
Coal India, in its commentary, has stated its intent to spend Rs 1500 Cr -2000Cr annually on
machinery procurement including heavy equipment, dumpers, etc segments where BEML is the
market leader.

Key Risks:
Inventory obsolescence
Metro capex cycle recovery

Production Units:

About the company:


BEML Limited is an India-based company engaged in manufacture of rail coaches and
spare parts and mining equipment. Its segment includes Mining & Construction, Rail &
Metro and Defense. The Trading Division deals in non-Company products. The
International Division exports products manufactured by all the three verticals. Under
Mining and Construction business, the Company manufactures and supplies Mining &
Construction equipment such as Bull Dozers, Excavators, Dumpers, Shovels, Loaders
and Motor Graders to various user segments and under Rail & Metro Business, it
manufactures and supplies Rail Coaches, Metro Cars, Steel and Aluminium Wagons
to the rail sector.

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

Financials Snap Shot

FY14
1.5
506.8
3.0
200%

RATIOS
FY15
FY16
1.4
12.8
505.8
506.6
1.2
4.7
82%
37%

FY17E
13.0
515.0
4.7
36%

196.6
0.6
1.02%

759.6
2.2
0.11%

68.8
1.7
0.53%

70.9
1.8
0.51%

0%
2%

0%
1%

3%
3%

3%
4%

0.6
122.9
271.6
48.9
0.22

0.6
129.2
250.3
70.8
0.20

0.7
148.1
208.7
50.5
0.17

0.7
150.0
201.6
40.0
0.16

INCOME STATEMENT

Revenue
Other Income
Total Revenue
COGS
GPM
Other Expenses
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
PBT
Tax
Tax Rate (%)
Reported PAT
Dividend Paid
No. of Shares

FY14
2904
64
2967
1694
1
373
115
4%
54
60
111
13
4
29%
6
12
4

FY15
2802
60
2862
1564
1
393
70
2%
53
17
71
6
0
-8%
6
5
4

Share Capital
Reserves
Net Worth
Long term Debt
Short term Debt
Deferred Tax
Total Capital Employed
Net Fixed Assets
Capital WIP
Debtors
Cash & Bank Balances
Trade payables
Total Provisions
Net Current Assets
Total Assets

FY14
42
2039
2081
465
441
0
2546
686
135
977
18
389
284
2420
4770

FY15
42
2035
2077
414
178
0
2491
660
150
992
145
543
290
2148
4591

FY16
2978
39
3017
1703
1
373
129
4%
54
75
49
65
11
18%
53
19
4

FY17E
2620
26
2646
904
0
786
156
6%
52
104
42
87
17
20%
54
19
4

EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Price / Book Value
Dividend Yield (%)
Profitability Ratios
RoE
RoCE
Turnover Ratios
Asset Turnover (x)
Debtors (No. of Days)
Inventory (No. of Days)
Creditors (No. of Days)
Net Debt/Equity (x)

BALANCE SHEET

FY16
42
2068
2110
363
147
0
2472
657
59
1208
66
412
317
2157
4331

FY17E
42
2103
2145
345
105
0
2489
698
150
1077
58
287
290
2087
3988

OP/(Loss) before Tax


Depreciation
Direct Taxes Paid
OP before WC changes
CF from Op. Activity

FY14
10
54
(26)
171
394

CAPEX
CF from Inv. Activity
Repayment of LTB
Interest Paid
Divd Paid (incl Tax)
CF from Fin. Activity
Inc/(Dec) in Cash
Add: Opening Balance
Closing Balance

(43)
(28)
(34)
(109)
(12)
(427)
(61)
78
18

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

CASH FLOW STATEMENT


FY15
FY16
FY17E
5
65
87
53
54
52
12
(15)
(17)
151
201
182
548
84
223
(41)
(36)
(31)
(67)
(5)
(384)
128
18
146

(24)
(30)
(31)
(45)
(5)
(134)
(79)
146
66

(93)
(93)
(18)
(42)
(19)
(122)
7
66
73
7

A Niche play

Neutral

VINATI ORGANICS LTD

9-Jan-17

About the Company :

Company Update
CMP

625

Target Price

659

Previous Target Price

NA

Upside

5%

Change from Previous

NA

Market Data
BSE Code

524200

NSE Symbol

VINATIORGA
664/361
3,222
6.5

52wk Range H/L


Mkt Capital (Rs Cr)
Av. Volume(,000)
Nifty

8244

VOL is into the manufacturing of specialty organic chemicals. largest


manufacturer of Isobutyl Benzene (IBB) and the 2nd largest manufacturer of
ATBS. ATBS is used in oilfield recovery, water treatment, acrylic fiber
manufacturing, adhesives, and personal care products, as well as in mining
industry, coatings, and as dispersing and flocculating agents. Other products
include IBB which is the basic raw material for manufacturing Ibuprofen and
Isobutylene (IB) which is used in agro-chemicals and is also a raw material for
manufacturing ATBS. VOL exports more than 75% of its production across USA,
Europe, Asia, Middle East and China and has been the preferred source for
some of the largest chemical manufacturing companies in the world. The
company started with a small capacity of 1,000 TPA and gradually expanded to
26,000 TPA today for its ATBS production, capturing 45% of the market share.
The company also command more than 65% market share in the world for IBB.
With consistent investments in technology and capacities, the company is the
largest producer of IBB in the world with a capacity of 16,000 TPA.

Stock Performance
1Month

1Year

YTD

Key Investment Arguments :

Absolute

4.6

36.0

34.8

Rel.to Nifty

3.7

30.1

30.4

Promising player in the Domestic Speciality Chemicals growth story


Enjoying synergy through strategic backward & forward integration. FY19
Capex plan to drive growth
Expansion of Product Basket, Improvement in Operating Efficiency to Drive
Growth
ATBS - contributing ~30% to the top line - fully backward integrated
VOLs contribution towards revenue from three main products
Robust Client base and long-term contracts provides a safe guard
VOL is well placed within its Competitors
Hedged pricing policy give confidence for higher margins
Healthy Balance Sheet, Strong returns ratios and Healthy Cash Flows displays
strong financial participation.
R & D backed by technology collaborations gives it competitive advantage
Snapshot of VOLs phenomenal track record during the last 5 years

Share Holding Pattern-%


Q2FY17

Q1FY17 Q4FY16

Promoter

74.0

72.6

72.3

Public

26.0

27.4

27.7

Others

0.0

0.0

0.0

100.0

100.0

100.0

Total

Company Vs NIFTY
145

VINATIORGA

NIFTY

135
125

115
105

95

Jan-17

Dec-16

Nov-16

Oct-16

Sep-16

Aug-16

Jul-16

May-

Apr-16

Jan-16

Mar-16

Dec-15

75

Jun-16

85

Bhabani Prasad Dehury


bhabani.dehury@narnolia.com

Financials
Sales
EBITDA
PBT
Net Profit
EBIDTA %
PBT %
PAT %

Q2FY17
148
46
41
30
31.1%
27.7%
20.5%

Q1FY17
167
60
54
36
35.6%
32.4%
21.4%

Narnolia Securities Ltd,


Please refer to the Disclaimers at the end of this Report

Q2FY16
163
52
47
31
32.2%
28.9%
19.1%

QoQ
-11.4%
-22.7%
-24.2%
-14.8%
(456) Bps
(470) Bps
(83) Bps

Rs,Cr
YoY
-9.1%
-12.1%
-13.0%
-2.1%
(108) Bps
(124) Bps
147Bps
8

Key Risks:
Concern :
De-risk Strategy :

Highly dependent on three products:


VOLs 72% of revenue accrued from three products - namely IBB, ATBS and IB. Thus its highly sensitive for market
changes in these three products. VOL has not only met this standard but also beat industry standard by achieving
purity levels of 99.8% which is the highest level of purity recognized globally. VOL is updated with latest
technology trends in the industry. VOL manufactures IBB with technology collaboration of Institut Francais du
Petrole . ATBS plant was installed based with the aid of National Chemical Laboratories today it is the worlds
largest manufacturer of ATBS. We believe company holds a strong entry barrier for its peers.

Concern :
De-risk Strategy :

Exposed to foreign currency fluctuations


The Company is protected through a natural hedge. It procures raw material through imports and local
purchases, where local purchases track the import parity price. The Company receives 67% of its revenue from
exports and the company borrows largely through ECBs which are in USD.

Concern :
De-risk Strategy :

Client retention risk


VOL, a preferred supplier for largest manufacturing companies like BASF, Dow Chemicals, Nalco Company (USA),
AkzoNobel, SNF Floerger, Ciba, Clariant Chemicals and many others. It is increasing its product basket with new
products to decrease its dependency on mainstream products (ATBS and IBB). VOL is expanding geographically
and equally emphasising on productsegment with capacity expansion for a sustainable future.

Concern :
De-risk Strategy :

Any Distortion in user Industry & Exposed to Government Policies of other countries
It is expected that the Indian chemical industry is expected to grow to reach US$ 300 Bn by 2021. Indias per
capita consumption of chemicals lower than that of other countries could trigger growth opportunity for the
Industry. Chemical industry is one of the most diversified covering sectors like inorganic chemicals, organic
chemicals, fine and specialties, drugs, agrochemicals; and it has registered a growth of 14% during the last 5
years. It is expected that the industry to hold the growth trajectory with strong government support for R&D,
100% FDI permitted through automatic route, rise in GDP and PPI hasgrowth potential for the domestic market.
VOL is well placed to grab the opportunities from the potential growth poised ahead.

Concern :
De-risk Strategy :

Fund raising for upcoming capex


Company enjoys a D/E ratio at 0.03x and a high interest cover of 26.3. Management believe company will be
debt free by FY17. Management believe internal accrual will manage all the capex plans. We beleive debt free
balance sheet will help the Company raise funds as and when required easily.

Concern :
De-risk Strategy :

Agrresive Capex plans


VOL is carrying Rs. 700 Cr capex plan mostly to increase its product portfolio. The market acceptance of the new
products is yet to be established. It has a well track record of selecting products for its launch pipeline which
have inherent synergies with the companys existing portfolio. They designed the ongoing process to give the
company competitive advantages for both backward and forward integration. This ensures a high level of supply
chain control and quality assurance as well cost-efficiencies with better margins.

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

Promising player in the Domestic Speciality Chemicals growth story


It is expected that the Indian chemical industry is expected to grow to reach US$ 300 Bn by 2021. Indias per capita consumption of chemicals lower than
that of other countries could trigger growth opportunity for the Industry. Chemical industry is one of the most diversified covering sectors like inorganic
chemicals, organic chemicals, fine and specialties, drugs, agrochemicals; and has registered a growth of 14% during the last 5 years. Rise in GDP and PPI
hasgrowth potential for the domestic market. VOLs 72% of revenue accrued from three products - namely IBB, ATBS and IB. VOL has not only met this
standard but also beat industry standard by achieving purity levels of 99.8% which is the highest level of purity recognized globally. VOL is updated with
latest technology trends in the industry. We believe company holds a strong entry barrier for its peers.

70%

65%

VOL Market share

60%

6.0%
8.0%
9.0%

31.0%

50%

45%

40%
30%

46.0%

20%
IBB

ATBS

IB

HPMTBE

FY16

Others

10%

0%
IBB marketShare

ATBS market share

Enjoying synergy through strategic backward & forward integration. Capex plan to drive growth
VOL is carrying Rs. 700 Cr capex plan mostly to increase its product portfolio. The market acceptance of the new products is yet to be established. It has a
well track record of selecting products for its launch pipeline which have inherent synergies with the companys existing portfolio. They designed the
ongoing process to give the company competitive advantages for both backward and forward integration (See page no :11) . This ensures a high level of
supply chain control and quality assurance as well cost-efficiencies with better margins.Capacity utilisation, about 80-90 percent and planning a lot of
expansion or rather new product launches in the next two-three years. Announced an investment close to Rs 700 crore. Rs 500 crore is going to be
towards introducing a new product, para-aminophenol (PAP), which is like how IBB is used for ibuprofen, PAP is used for paracetamol. Will also be making
an investment of Rs 160-200 crore to make butylated phenols which are made from phenols and isobutylene. This will add about Rs 350 crore in
revenues, but these two products will come on stream in FY19. In FY18, revenue growth by virtue of ATBS growth as well as the new products that
started this year which include two customised products as well as P-Tert-Butyltoluene (PTBT), P-Tert-Butylbenzoic Acid (PTBBA), Tert-Butylamine (TB
Amine), etc.

Expansion of Product Basket, Improvement in Operating Efficiency to Drive Growth


Company is addind two new products to its portfolio which includs PAP and butylated phenols. This two products will add ~350Cr to its ttopline from
FY19. PAP is a very genuine product which is used for making paracetamol drugs, very mature market. But the reason behind launching these products is
company developed a novel process along with NCL who has a patented technology and have exclusive licence for its new process.It is more cost effective
and environment friendly process.Management beleive to replace at least about 22,000 tonnes of PAPs imported into the country from China. on account
of a superior process. In FY18, revenue growth by virtue of ATBS growth as well as the new products that started this year which include two customised
products as well as P-Tert-Butyltoluene (PTBT), P-Tert-Butylbenzoic Acid (PTBBA), Tert-Butylamine (TB Amine), etc.PTBT and PTBBA which will come on
stream from the 2HFY17 is set to add approx. INR 500 700 mn; thereby leading to an improvement in the companys revenue growth and margin profile.

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

10

ATBS - contributing ~45% to the top line - fully backward integrated. VOLs contribution towards revenue
from three main products.
Basic use of IBB to make ibuprofen which is a mature segment in pain killer drug market, hence demand likely to same. Company also
strategically lowered the IBB revenue segment. ATBS is used for different industries such as water treatment, oil and gas, personal care etc.
Current market shows a dip in demand from Oil Recovery segment. But demand from water treatment segment is good and likely to increase.
In FY17 volume may go in a slow pace but going forward it has to come back through recovery in oil segment backed by strong water
treatment demand. ATBS is having a 46% contribution towards revenue.
IB is a forward integration process to manufacture ATBS and used in agrochemicals where we expect a good growth in demand. This improves
the cost efficiency among its peers. Currently, VOL is the largest player for IBB (65% of the global market share). VOL started manufacturing
ATBS with an initial 1,200 MTPA, through the years it increased the capacity to 26,000 MTPA and is the world's largest manufacturer of ATBS
(45% of the global market share). VOL also commands a leadership position in India in another product it manufactures, HPMTBE (High Purity
Methyl Tertiary Butyl Ether).

Robust Client base and long-term contracts provides a safe guard


VOL, a preferred supplier for largest manufacturing companies like BASF, Dow Chemicals, Nalco Company (USA), AkzoNobel, SNF Floerger,
Ciba, Clariant Chemicals and many others. It is increasing its product basket with new products to decrease its dependency on mainstream
products (ATBS and IBB). VOL is expanding geographically and equally emphasising on product segment with capacity expansion for a
sustainable future and long_term contracts with clients.

Hedged pricing policy give confidence for higher margins


Comoany performs a sensitive price strategy,as its finshed products are strongly crude derivatives. But on a good track record, company
always able to paas on the increase and decrease in crude to its customer. This pricing policy ensures stable margins.
When we come to the dollar-rupee movement also; 80 percent of therevenues are coming from exports, most of revenues are US dollar
based, but because company's raw material are also priced in dollars, even the inputs that are purchasing locally, are priced in dollar values,
so it does not affect company's margins. If whatever is the surplus of exports minus the imports, company also take dollar denominated
loans. So, net-net, company is neutral to the exchange rate movement as well.

Healthy Balance Sheet, Strong returns ratios and Healthy Cash Flows displays strong financial participation.
VOLs cash flow from operations has been consistently positive and never turned negative in the past 20 years. Despite the on-going capex
cycle, the company generated healthy Cash flow from operation for FY15 and FY16 of Rs 113Cr and Rs 167Cr, respectively. We believe VOLs
cash flow from operations or CFO will remain positive and will also continue over FY17E-FY18E. We expect WC days to remain in a similar
range. Company enjoys a D/E ratio at 0.08x and a high interest cover of 26.3. Management believe company will be debt free by FY17.
Management believe internal accrual will manage all the capex plans.

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

11

Management Highlights
Management currently enjoys D/E ratio at 0.3x and Will be debt free by end of FY17E.
The company has easily able to pass on crude price movements to customers.
ATBS accounts for 45 percent of the total revenue and makes up for 50 percent market share.
Capacity utilisation, about 80-90 percent and planning of expansion. Company is going to lunch new products in the next two-three years.
Company announced an investment close to Rs 700 crore. Rs 500 crore is going to be towards introducing a new product, para-aminophenol
(PAP), PAP is used for paracetamol. Will also be making an investment of Rs 160-200 crore to make butylated phenols which are made from
phenols and isobutylene. This will add about Rs 350 crore in revenues, but these two products will come on stream in FY19.
In FY18, revenue growth by virtue of ATBS growth as well as the new products that we started this year which include two customised
products as well as P-Tert-Butyltoluene (PTBT), P-Tert-Butylbenzoic Acid (PTBBA), Tert-Butylamine (TB Amine), etc.
IBB is a mature product its very common.about 3-5 percent annual growth rate in IBB, dependence on IBB as a product has been going
down. Initially, it was about 40 % of our revenue mix; today it is close to 25%.
ATBS Growing at about 10 percent and our revenues in ATBS grow at 15 percent.
H2FY17 is going to be in line with the first half. So, as far as revenues and profitability margins go, so company should be able to maintain
that.

Q2FY17 Result Update


For Q2 FY17, VOL's revenue was RS. 148.1 cr,-26.7% YoY and -11.4% QoQ; EBITDA was RS. 46.0 cr, -13.3% YoY and -22.7% QoQ; and PAT was
RS. 30.4 cr, -1.3% YoY and -14.8% QoQ.
Revenues de-grew on account of annual maintenance shutdown, which was shifted from 1Q to 2Q and ban on movement of heavy cargo
vehicles for ~10 days during Ganpati festival. The company is expected to launch new products during FY17, the full effect of which will be
realised in FY18E. Going forward, we expect introduction of new products to be the key volume driver

Recommendation and Outlook:


We expect that the company to maintain its leadership position in IBB and ATBS along with its increasing product basket could
able to cater to the growing needs of specialty chemicals industry which in turn to drive revenue. A well experienced and able
management coupled along with good growth in the ATBS segment driven by demand in the water treatment segment projects a
positive outlook for the company. The company currently trades at a P/E of 14x FY18E EPS and P/B of 4.6 x FY18 book value. We
Initiate Coverage on the stock . Presently we rate it as 'Neutral' due to its stretch valuation. Our price target on the stock is Rs
659 rating it as P/B of 3.7 on FY19e.

5 yr Snapshot of Vinati organics : excellent management with a distinguished track record, making it a
compelling growth story
Net revenue from operation grown at a CAGR of ~20% during FY11-FY16 whereas EBITDA and PAT clocked a CAGR of ~26% and ~22%
respectively over the same period. Vinati organics abled to maintain its EBITDA margins at more than 22%; whereas NPM% recorded more
than 14%. The RoE is in a range 20%-30% and RoCE is at ~20% during the last 5 years. We expect Revenue, EBITDA and PAT to grow at CAGR of
12%, 15% and 15% respectively during FY18 to FY19E. Accordingly, we also expect RoE and ROCE to be intact above 20%
Vinati Organics, established in 1989 by Mr. Vinod Saraf, is a specialty chemicals company producing aromatics, monomers, polymers and
other specialty products. VOL started operations at its first plant in Mahad-Raigad in 1992, with its focus on IBB. In 2002, the company started
commercial production at its second plant in Lote, Ratnagiri, for manufacturing ATBS. Superior technology and strategic capacity expansion
plan made VOL the worlds largest manufacturer of IBB as well as ATBS (with 65% and 45% market share globally, respectively).
Narnolia Securities Ltd
Please refer to the Disclaimers at the end of this Report

12

Brief Highlights Q4FY16 Results : 3QFY15


4QFY15
1QFY16
2QFY16
3QFY16
4QFY16
1QFY17
2QFY17
Net Sales / Income from Operations 202.1
175.0
163.4
162.9
152.2
154.4
167.1
148.1
Other Income
1.4
3.5
1.1
1.6
1.5
2.0
1.3
0.8
Total Income
203.5
178.4
164.5
164.5
153.7
156.4
168.4
148.9
COGS
117.2
91.4
78.0
79.5
71.6
69.1
72.8
59.0
Employee Benefit Expenses
8.2
7.7
9.0
8.8
8.7
9.3
10.2
10.4
Other Expenses
23.6
26.3
23.2
22.2
21.3
25.2
24.6
24.4
Excise Duty
0.0
0.0
0.0
0.0
0.0
0.0
0.0
8.3
Expenditure
149.0
125.4
110.2
110.5
101.7
103.7
107.6
102.1
EBITDA
53.1
49.6
53.1
52.4
50.5
50.7
59.5
46.0
Depreciation and Amortisation expense 4.5
4.4
4.6
4.6
4.6
4.7
5.3
5.4
EBIT
48.6
45.2
48.6
47.8
45.9
46.0
54.3
40.7
Interest
2.8
0.8
2.5
2.2
2.0
1.2
1.4
0.5
PROFIT BEFORE TAX
47.2
47.9
47.3
47.1
45.4
46.8
54.1
41.0
Tax
16.4
15.5
16.2
16.0
15.2
7.6
18.4
10.6
PROFIT AFTER TAX
30.8
32.4
31.0
31.1
30.2
39.3
35.7
30.4
EPS
6.2
6.6
6.3
6.3
6.1
8.0
7.2
6.2

QoQ

YoY

-11.4%
-36.8%
-11.6%
-19.0%
2.0%
-0.7%

-26.7%
-44.3%
-26.8%
-49.7%
27.6%
3.1%

-5.1%
-22.7%
1.3%
-25.0%
-66.6%
-24.2%
-42.6%
-14.8%
-14.8%

-31.5%
-13.3%
19.2%
-16.3%
-82.9%
-13.2%
-35.7%
-1.3%
-1.3%

Margin %
EBIDTA %
EBIT %
PAT %

3QFY15

QoQ

Cost Calculation % to sales


COGS % as Sales
Employee Expence % as Sales
Other expenses % as Sales
Expenditure % as Sales
Tax % to PBT

3QFY15

Growth calculation
Sales Growth
EBIDTA Growth
EBIT Growth
PAT Growth

3QFY15

26.3%
24.0%
15.3%

58.0%
4.0%
11.7%
73.7%
34.7%

14.8%
33.2%
35.6%
32.7%

4QFY15

28.3%
25.8%
18.5%
4QFY15

52.3%
4.4%
15.0%
71.7%
32.3%
4QFY15

-10.4%
9.7%
9.5%
17.4%

1QFY16

32.5%
29.7%
19.0%
1QFY16

47.8%
5.5%
14.2%
67.5%
34.3%
1QFY16

-17.6%
31.3%
34.4%
28.7%

2QFY16

3QFY16

32.2%
29.3%
19.1%
2QFY16

3QFY16

48.8%
5.4%
13.6%
67.8%
34.0%
2QFY16

4QFY16

33.2%
30.1%
19.8%

32.9%
29.8%
25.4%
4QFY16

47.1%
5.7%
14.0%
66.8%
33.5%
3QFY16

-17.1%
7.7%
8.1%
9.3%

44.7%
6.0%
16.3%
67.1%
16.1%
4QFY16

-24.7%
-4.8%
-5.5%
-2.1%

-11.8%
2.3%
1.8%
21.1%

1QFY17

35.6%
32.5%
21.4%
1QFY17

43.6%
6.1%
14.7%
64.4%
34.0%
1QFY17

2.3%
12.0%
11.7%
15.1%

2QFY17

31.1% (456) Bps


27.5% (501) Bps
20.5% (83) Bps
2QFY17

QoQ

YoY

481Bps
341Bps
529Bps
YoY

39.8% (373) Bps (1816) Bps


7.0%
92Bps 300Bps
16.5% 177Bps 476Bps
68.9% 456Bps (481) Bps
25.7% (822) Bps (900) Bps
2QFY17

QoQ

YoY

-9.1% (1136) Bps (2383) Bps


-12.1% (2417) Bps (4533) Bps
-14.9% (2652) Bps (5046) Bps
-2.1% (1712) Bps (3477) Bps

Segment Sales
FY08
IBB in Cr
ATBS in Cr
IB In Cr
HPMTBE
Others In Cr
Revenue from Operations in Cr
Domestic Sales in Cr
Export Sales in Cr

FY09
100
40
0
0
7
146
53
93

FY10
184
123
0
0
16
191
46
145

FY11
118
100
0
0
14
232
56
176

FY12
106
184
13
0
19
323
71
252

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

FY13
179
215
36
0
18
447
107
340

FY14
238
227
55
0
33
553
171
381

FY15
244
285
90
0
77
696
230
466

FY16
232
355
93
31
62
772
247
525

196
290
57
38
50
631
208
423
13

Revenue and Profit


250

200

Net Sales

196

EBITDA

PROFIT AFTER TAX

174
150

144

150

160

149

137

145

100

50

53
31

50
32

53
31

52
31

51
30

51
39

60
36

46
30

3QFY15

4QFY15

1QFY16

2QFY16

3QFY16

4QFY16

1QFY17

2QFY17

Revenues de-grew on account of annual maintenance


shutdown, which was shifted from 1Q to 2Q and ban on
movement of heavy cargo vehicles for ~10 days during
Ganpati festival.

EBIDTA and EBIDTA Margin


EBITDA (Cr)

EBIDTA %
35.5% 36.4% 36.8% 34.0% 37.1%

70
60

40.0%
31.8%
30.0%

27.0% 28.5%

50
40
30

53

53

50

20

52

51

51

20.0%

60
46

We expect a strong set of EBIDTA% going ahead due


to new launches and strong ATBS margin

10.0%

10

0.0%

0
3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16 1QFY17 2QFY17

Depriciation and Interest cost


6.0
5.0

4.5

Depreciation (Cr)
4.6
4.4

5.4

5.3

Interest (Cr)
4.6
4.6

4.7

4.0
3.0

2.8

2.5

2.2

2.0

2.0

1.4

1.2

0.8

1.0

Company enjoys 0.3x D/E ratio. By end of FY17E it


will be debt free, further capex will be done by
internal accruals
0.5

0.0

3QFY15

4QFY15

1QFY16

2QFY16

3QFY16

4QFY16

1QFY17

2QFY17

Strong set of Margins


70.0%

Gross Margin %

EBIDTA %

EBIT %

60.0%

50.0%
40.0%
30.0%

47.7%

52.2%

51.2%

52.9%

42.0%

26.3%

32.5%

32.2%

33.2%

18.5%

19.0%

19.1%

19.8%

4QFY15

1QFY16

2QFY16

3QFY16

28.3%

20.0%
10.0%

55.3%

PAT %
60.2%
56.4%

32.9%
25.4%

15.3%

35.6%

31.1%

21.4%

20.5%

1QFY17

2QFY17

We expect a strong set of margins going ahead due to


new launches , debt free balance sheet and strong ATBS
margin

0.0%
3QFY15

4QFY16

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

14

Revenue (Rs. Cr) and Growth (%)


900

50.0%

Revenue from Operations (Net)


Growth YoY
39.2% 38.7%
30.2%
23.6% 25.9%
21.7%

800
700
600
500

400
300
200

100

191

232

FY09

FY10

323

447

553

696

772

40.0%
30.0%
20.0%

10.9%

10.0%
0.0%

631

-10.0%
-18.2%
-20.0%

We expect the revenue to grow at a CAGR of 12% during FY18FY19E. We expect a muted growth during FY17E on the back of
falling crude prices that could affect the ATBS realization. We
expect that the recovery of crude prices and increase in demand of
its products other than ATBS could pull the sales.

-30.0%

0
FY11

FY12

FY13

FY14

FY15

FY16

Cost of Material Consumed to Net Operating Revenue


60.6%

60.2%

60.0%

191
122

232
133

323
183

447
268

553
335

FY09

FY10

FY11

FY12

FY13

300
200

50.0%
40.0%

COGS % to sales

772

400

457

500

47.0%

696

600

70.0%

59.2%

Revenue from
Operations (Net)
COGS

700

100

59.8%

56.8%

FY14

FY15

30.0%

631

57.3%

20.0%

296

64.0%

800

419

900

We expect the falling crude prices could reduce the input cost. We
also expect that with upgraded technologies and with further
R&D, it could achieve better material and energy efficiencies.

10.0%

0.0%

FY16

EBITDA (Rs. Cr) and Margins


32.8%

250

EBITDA
200

21.6%

21.2%

21.8%

35.0%
30.0%

24.8%
22.0%

25.0%

17.8%

FY10

FY12

FY13

153

120

53

FY09

95

34

50

70

100

207

20.0%

192

150

22.7%

EBIDTA%

15.0%
10.0%

We expect the EBITDA to register a growth of 15% CAGR during


FY18-FY19E. VOL is likely to maintain the margins above 20.0%
during FY18E-FY19E. Softening crude prices could decline the
input prices which might help to improve the margins further.

5.0%

0.0%

FY11

FY14

FY15

FY16

Net Profit (Rs. Cr) and Margins


140

25.0%

PAT
17.3%

100

20.9%

20.0%

16.1%

13.2%

15.0%
12.2%

12.4%

52

55

40

25

FY11

FY12

10.0%

86

40

69

60

20

15.0%

12.4%

116

80

PAT %

132

120

PAT clocked a CAGR of ~26% over last 5 yrs . Vinati organics


abled to record NPM% more than 14%. We expect PAT to
grow at CAGR of 15% during FY18 to FY19E.

5.0%

0.0%

FY09

FY10

FY13

FY14

FY15

FY16

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

15

RoCE (%) and RoE (%)


40.0%

ROE %

35.0%

30.0%

ROCE %

24.0%

22.6%

25.0%
20.0%

15.4%

18.5%

21.7%

VOLs RoE and RoCE are likely to be around 20% during


the next couple of years..

14.7%

15.0%

36.2%

29.3%

28.5%

27.8%

26.7%

24.3%

10.0%

FY11

FY12

FY13

FY14

FY15

FY16

5.0%
0.0%

Debt / Equity (x)


0.82

0.90

0.83

0.80
0.70
0.60

0.50

0.43

Company enjoys a D/E ratio at 0.03x . Management


believe company will be debt free by FY17.
Management believe internal accrual will manage all
the capex plans.

0.39

0.40
0.30
0.20

0.09

D/E Ratio

0.10

0.03

0.00

FY11

FY12

FY13

FY14

FY15

FY16

Current Ratio (x)


4.5

4.1

4.0
3.5

3.2

3.1

3.0

2.7

2.5

2.8

2.7

Current Ratio

2.0
1.5

Historically, VOL has already maintained a current ratio


above 2.5x. We expect that it can maintain its working
capital management on a sustainable basis.

1.0

0.5
0.0
FY11

FY12

FY13

FY14

FY15

FY16

17.5%

17.0%

Dividend Yield and Dividend Payout


25.0%

20.9%

21.0%

20.1%

20.0%

14.4%
15.0%

Dividend Payout

10.0%

VOL is a good proxy for dividend. Historically, it pays


dividend on a regular basis.

5.0%
0.0%
FY11

FY12

FY13

FY14

FY15

FY16

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

16

30.0

25.0

20.0

15.0

10.0

5.0

0.0

EV/EBDITA
10.0

5.0

25.0

20.0

5.0

5.0

0.0

0.0

2.7 2.3
1.9 2.2

30.0

15.0

6.6

4.8
7.5

30.0

10.0

5.8

6.7

5.9

Narnolia Securities Ltd

Please refer to the Disclaimers at the end of this Report


3.4

7.3

15.0

8.2

2.1 2.0 1.7

20.0

11.7

7.4 7.3

ROCE

5.7 5.5
13.7
12.912.9
12.411.9 12.8
11.011.4
9.5
9.3 9.9

25.6
21.1
22.0
22.5
27.4
24.6
23.7
21.8
28.2
24.1
20.0

30.0

11.1

11.1

20.6

26.8
23.8
ROCE

3.1

ROCE

25.6
21.1
22.0
22.5
27.4
24.6
23.7
21.8
28.2
24.1
20.0

18.9
18.4

19.4

15.0

18.9
18.4

ROE

P/E
5.0

19.4

35.0
30.0

11.1

10.0

ROE
10.0

14.1

20.0

11.1

15.0
20.0

20.6

0.0

201112
201203
201206
201209
201212
201303
201306
201309
201312
201403
201406
201409
201412
201503
201506
201509
201512
201603
201606
201609

25.0

14.1

20.0
25.0

26.8
23.8
14.1
20.6
11.1
19.4
11.1
18.9
18.4
25.6
21.1
22.0
22.5
27.4
24.6
23.7
21.8
28.2
24.1
20.0

25.0

1.9
28.8
2.2
29.3
2.7
28.8
2.3
32.1
3.4
28.8
2.1
28.5
2.0
27.1
1.7
25.0
3.1
26.7
4.5 27.8
4.9 29.2
5.5 26.3
5.2 26.2
6.2 26.7
5.8 26.4
4.7 25.3
4.6 23.7
3.7 24.3
4.9 23.6
4.9 23.6

30.0

201112
201203
201206
201209
201212
201303
201306
201309
201312
201403
201406
201409
201412
201503
201506
201509
201512
201603
201606
201609

35.0

P/B

26.8
23.8

201112
201203
201206
201209
201212
201303
201306
201309
201312
201403
201406
201409
201412
201503
201506
201509
201512
201603
201606
201609

5.0

6.6 28.8
7.5 29.3
9.3
28.8
7.3 32.1
28.8
11.7
7.4 28.5
7.327.1
6.725.0
26.7
11.8
27.8 16.0
29.2 16.7
26.3
20.9
26.2
20.0
26.7
23.4
26.4
21.9
25.3
18.8
23.7
19.3
24.3 15.2
23.6
20.6
23.6
20.6

10.0

ROE

201112
201203
201206
201209
201212
201303
201306
201309
201312
201403
201406
201409
201412
201503
201506
201509
201512
201603
201606
201609

201112
201203
201206
201209
201212
201303
201306
201309
201312
201403
201406
201409
201412
201503
201506
201509
201512
201603
201606
201609

15.0

4.8
28.8
5.8
29.3
6.7
28.8
5.9
32.1
8.2
28.8
5.7
28.5
5.5
27.1
4.9
25.0
7.6
26.7
9.3
27.8
9.9
29.2
12.4 26.3
11.9
26.2
13.7 26.7
12.8 26.4
11.0
25.3
11.4 23.7
9.5
24.3
12.9 23.6
12.9 23.6

35.0

201112
201203
201206
201209
201212
201303
201306
201309
201312
201403
201406
201409
201412
201503
201506
201509
201512
201603
201606
201609

Valuation Matrix and Band


ROE & P/B
ROCE & P/B

P/B

4.5 4.9

5.5 5.2

25.0
20.9
20.0

16.016.7

ROE & P/E


6.2 5.8

ROE & P/E


4.7 4.6

23.4
21.9
18.819.3

3.7
4.9 4.9

0.0

ROCE & P/E

P/E
20.620.6

15.2

9.3
11.8

6.7

0.0

ROCE & P/E

EV/EBDITA

4.9

7.6

17

Product Segment : Each product is well positioned through strategic backward integration

Facilities
Location
Products manufactured
Capacity
As On

Plant1
Mahad-Raigad,Maharashtra
IBB and NBB
16000TPA
Total capacity as on 31 March, 2016

Plant2
Lote-Ratnagiri, Maharashtra
ATBS, NaATBS, TBA, IB, HPMTBE, DAAM
47500TPA
Total capacity as on 31 March, 2016

About the Company :


VOL is into the manufacturing of specialty organic chemicals. largest manufacturer of
Isobutyl Benzene (IBB) and the 2nd largest manufacturer of ATBS. ATBS is used in
oilfield recovery, water treatment, acrylic fiber manufacturing, adhesives, and
personal care products, as well as in mining industry, coatings, and as dispersing and
flocculating agents. Other products include IBB which is the basic raw material for
manufacturing Ibuprofen and Isobutylene (IB) which is used in agro-chemicals and is
also a raw material for manufacturing ATBS. VOL exports more than 75% of its
production across USA, Europe, Asia, Middle East and China and has been the preferred
source for some of the largest chemical manufacturing companies in the world. The
company started with a small capacity of 1,000 TPA and gradually expanded to 26,000
TPA today for its ATBS production, capturing 45% of the market share. The company
also command more than 65% market share in the world for IBB. With consistent
investments in technology and capacities, the company is the largest producer of IBB in
the world with a capacity of 16,000 TPA.

4000
3500
3000

5.1x

2500
3.9x

2000
1500

2.8x

1000

1.6x

500
0

P/B Band
Narnolia Securities Ltd
Please refer to the Disclaimers at the end of this Report

18

Product :

Applications :

2-acrylamido 2-methylapropane sulphonic acid (ATBS)

Sodium salt of 2-acrylamido-2- methylpropane sulphonic


acid (NaATBS)

N-Tertiary Butyl Acrylamide (TBA)

N-Tertiary Octyl Acrylamide (TOA)

Diacetone Acrylamide (DAAM)

Iso Butyl Benzene (IBB)


Normal Butylbenzene (NBB)

C 10 Aromatic (Solvent)

Isobutylene (IB)

Water treatment chemicals


Oil field and mining chemicals
Construction chemicals
Textiles auxiliaries and acrylic fibre
Detergents and cleaners
Emulsions for paint and paper coatings
Adhesives
Water treatments chemicals
Emulsions for paint and paper coatings
Adhesives
Textiles auxiliaries and acrylic fibre
Detergents and cleaners
Oil field and mining chemicals
Construction chemicals
Thickener in personal care
Water treatment
Metal working fluid
Adhesives
Antiscalants
Enhanced oil recovery
Personal care
Coatings
Personal care
Epoxy resin
Gelatin substitute
Light sensitive resin additive
Pharmaceutical industry
Perfume industry
Speciality solvent
Speciality solvent
LCD based applications
Paints and coatings
Inks
Cleaning solvents
Environmental friendly agrochemical and Pesticides formulations
Butyl rubbers
Antioxidants
Fragrances and perfumes
Insecticides and pesticides
Personal care
Monomers

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

19

Product :

Applications :

Methanol

High Purity- Methyl Tertiary Butyl Ether (HP-MTBE)

Hexene

Vinflow (HT)

Vinplast 245 (Acrylic Super Plasticizer)

Pharmaceutical industry
Paint and varnish industry
Perfume industry
Manufacture of formaldehyde
Chemical synthesis (sodium methoxide, dimethyl ether and methyated
derivatives)
Low cost solvent in some organic synthesis
Extract solvent for pharmaceutical synthesis
Synthesis of grignards reagent
Low boiling point solvent
Used as thinners
Hydrocarbon resins
Solvent extractions
Tyre re-treading
Octane booster for gasoline
Manufacturing C-5 / C-6 aliphatic petroleum
Construction
Ceramics
Oil drilling
Mining
Leather
Paper
Construction
Ceramics
Oil drilling
Mining
Leather
Paper

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

20

Financials Snap Shot


INCOME STATEMENT
P/L
Ratio
FY13
FY14
FY15
FY16
Revenue from Operations (Net)
553
696
772
631
Earnings Per Share
Other Income
4
9
9
6
Book Value per share
Total Revenue
557
705
781
637
Dividend Per Share
COGS
335
419
457
296
Dividend Payout
Gross Margin %
39%
40%
41%
53%
Valuation(x)
Employee Expense
23
27
32
36
P/E
Other Expenses
75
97
92
92
P/BV
Expenditure
433
543
580
424
EV/Sales
EBITDA
120
153
192
207
M-cap/EBIDTA
EBIDTA %
22%
22%
25%
33%
EV/EBIDTA
Depreciation
10
15
18
19
Profitability Ratios
EBIT
110
138
174
188
Return on Equity
EBIT %
20%
20%
23%
30%
ROCE
Finance Costs
12
18
10
8
Turnover Ratios
PROFIT BEFORE TAX
103
129
173
187
Asset Turnover ratio
TOTAL TAX
34
42
58
55
Debtor/Receivable Days
Tax % to PBT
33%
33%
33%
29%
Inventory Days
PROFIT AFTER TAX
69
86
116
132
Payable Days
PAT %
12%
12%
15%
21%
D/E Ratio

B/S

FY13

Share capital
Reserves and surplus
Net Worth
Long-term borrowings
Short-term borrowings
Deferred tax liabilities
Trade payables
Short-term provisions
Total Liabilities
Fixed assets (Total )
Longterm Loans advance
Non-current assets
Current investments
Inventories
Trade receivables
Cash and bank balances
Total Assets

10
231
241
136
65
26
16
17
546
304
0
304
13
55
113
34
546

BALANCE SHEET
FY14
FY15
10
300
310
110
12
33
14
21
552
314
5
322
3
47
115
43
552

10
424
434
37
2
39
22
26
599
347
10
358
3
54
129
27
599

FY13
14
49
2.5
21.0%

RATIOS
FY14
FY15
17
23
63
88
3.0
3.5
20.1% 17.5%

FY16
27
110
3.9
17.0%

7.4
2.1
1.2
4.2
1.2

16.0
4.5
2.1
9.0
2.1

22.4
6.0
3.4
13.5
3.4

14.6
3.5
2.9
9.3
2.9

28.5%
14.7%

27.8%
18.5%

26.7%
22.6%

24.3%
21.7%

1.0
75
36
10
0.8

1.3
60
24
7
0.4

1.3
61
26
10
0.1

0.9
61
26
10
0.0

FY16

C/F

CASH FLOW STATEMENT


FY13
FY14
FY15
FY16

10
530
541
13
3
49
22
12
687
407
15
424
3
45
115
72
687

Profit before tax


Depreciation
Direct taxes
PBWC
Trade receivables
Inventories
Trade& other payables
Net cash operating
Fixed assets purchased
CWIP
Net cash investing
Interest paid
Dividends paid
Net cash financing
Net cash & equivalents
Cash at the beginning
Cash at the end

103
10
-22
125
-18
-12
19
92
-156
43
-113
6
-10
22
2
32
34

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

129
15
-37
158
1
8
3
134
-29
4
-9
7
-12
-113
12
34
45

173
18
-52
188
-11
-8
-4
113
-42
-15
-53
5
-12
-75
-16
43
27

187
18
-45
205
14
10
-16
167
-73
-3
-72
3
-18
-50
45
27
72

21

HOLD
KEC International

6-Jan-17

Result Update
CMP
Target Price
Previous Target Price
Upside
Change from Previous

146
165
13%
-

Market Data
BSE Code
NSE Symbol
52wk Range H/L
Mkt Capital (Rs Cr)
Av. Volume
Nifty

532714
KEC
153/97
3,744
30699
8191

Stock Performance
Absolute
Rel.to Nifty

1Month

3 Month

1Year

4.2
3.5

15.4
21.4

-8.0
-10.9

Share Holding Pattern-%


2QFY17

Promoters
Public

51%
49%

1QFY17 4QFY16

51%
49%

51%
49%

KECs Management, in its recent interview, has said that the Q3 will not be
great in terms of revenue growth. The companys domestic business was
impacted due to non availability of labour and trucks. Management is not
sure enough to achieve its revenue guidance of 10% growth in FY17. But
management is confident to maintain 8.5% of EBITDA margin in current
fiscal year. According to our view, in short run, companys revenue growth will
remain lackluster but medium to long run growth remains intact.

Robust Revenu visibility in Railway:Railway Ministry has set target to award 2000 Km, 4000 Km and 6000 km of
overhead electrification orders in FY17, FY18 and FY19 respectively. In
railways, KEC commands 20% market share, which may translate into
approx.2400 Cr of expected new orders in FY18E. Order Intake in Railway
segment is up by 158% in H1FY17 and it is the lowest bidder in 400 Cr of
orders. Railway ministrys focus on execution helps contractor to execute
project smoothly and timely. We expect improvement in EBITDA margin
based on increase volume and speedy execution.

Reduction in Debt through efficient working capital management:KEC has reduced gross debt by Rs. 300 cr with the help of better AR
management (reduction of Rs 485 Cr). Working capital days improved to
229 days from 246 days. Management expects to release retention money
from project in Saudi as project gets completed in next 2-3 months. Hence, it
will lead to further reduction in working capital days. Company aims to bring it
down to 180 days by the year end.

Outlook and Valuation

Company Vs NIFTY
120

KEC

NIFTY

110
100

90
80

In short run, companys revenue growth will remain lackluster but medium to
long-term growth remains intact. Efficient working capital management
strengthened balance sheet position and we expect it to continue going
forward. We expect to ramp up in an execution of substation (T&D) projects
and railway projects. Robust opportunity in railway segment with improving
margin will help KEC to post healthy numbers going forward. But considering
the short-term uncertainty, we maintain HOLD on the stock with unchanged
target price of Rs. 164

70

In Rs. Cr

60
50
40

Sandip Jabuani
sandip.jabuani@narnolia.com

Financials
Sales
EBITDA
Net Profit
EBIDTA%
PAT

Q2FY16
2021
155
44
7.7%
2.2%

Q1FY17
1785
150
31
8.4%
1.7%

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

Q2FY17
2121
185
65
8.7%
3.1%

YoY %
5%
20%
47%

QoQ %
19%
24%
110%

22

Result Highlights Q2FY17 & H2FY17


Revenue grew by 5% YoY and de-grew by 1% YoY in Q2FY1 and H1FY17 respectively. Delay in conversation of L1 order into
firm orders, back ended execution project and weak execution led to muted revenue growth in Q2FY17 and H1FY17.
EBITDA grew by 49% YoY and 13% to Rs. 185 cr and Rs. 335 Cr in Q2FY17 and H1FY17 respectively. Strong double digit and
increased EBITDA margin of SEA and railway business respectively support the EBITDA margin.
PAT margin reported robust growth of 47% YoY and 96% YoY to 72 Cr , 119 Cr in Q2FY17 and H1FY17 respectively. Lower
interest out go, strong performance at revenue and EBITDA level helped to grew higher.
SAE revenue grew by 30% YoY to Rs. 261 cr as compared to Rs. 201 Cr in same period last year with strong double digit
EBITDA marin. SAE business current order book stands at Rs. 1510 Cr (1.8x of FY16 revenue) and expect huge demand going
forward.

Railway business reported robust revenue growth of 94% YoY to Rs. 66 Cr as against Rs. 34 Cr in same period last year.
Railways current order book stands at Rs. 1186 Cr (7x of FY16 Revenue) and management expects to close order book around
Rs. 1200 Cr by year end.

Managment / Concall Update


Management is not sure to achieve 10% revenue growth in FY17. If things pick up immediately than KEC might able to achieve
revenue growth
Maintain 8.5% EBITDA margin
KEC managed to collect Rs.1000 Cr of debtors from Saudi Arabia in Q2FY17 and it overall reduced debtors by Rs. 500 Cr and
gross debt by Rs. 150 Cr. Expect to complete 3-4 projects in Saudi in coming quarter.
Working capital days reduce to 229 days from 246 days and it will further reduce to 180 days by year end. Expect to release
retention money from Saudi project. This will reduce working capital requirement.
SAE reported double digit EBITDA margin. Current order stands at Rs. 1500 Cr executable over next 2 years.
Cable Business: - Positive on EBITDA level but still negative on PBT level due to high depreciation. Management expects to turn
positive on PBT level by year and EBITDA margin will be accretive from next year. EHV and Solar cable is key driver for the future
growth.
International Orders:- Rs. 2500 Cr out of 3800 cr of L1 orders belongs to international market.
T &D:- Management see huge opportunity in domestic T&D market. Growth will driven by Karnataka, Tamilnadu, Rajasthan, West
Bengal and Telengana SEBs.
Normal tax rate in FY17 (35%-36%)
Interest cost will be 3% of sales in FY17 and 2.7% of sales in FY18

Order Book

Order Intake
Book to bill

10785

10,403

9,487

9,351

9,872

10,537

9,508

8,770

9,320

10,325

37%

2000
1500

1000

500

-5%

-13%

-37%

-7%

-8%
-33%

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

3103

4,000

42%

2825

63%

2500

1877

6,000

3000

2246

1506

106%

3085

Growth YoY%

3500

2423

8,000

1100

10,000

2,000

Order Intake

1892

12,000

2808

Order Book

120%
100%
80%
60%
40%
20%
0%
-20%
-40%
-60%

23

Segmental Revenue

Maintain 10% revenue


growth and 8.5%
EBITDA margin for the
FY17

EBITDA margin
10.0%
9.0%
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%

8.7%
7.3%
5.9%

5.6%

7.5%

7.7%

7.8%

8.4%

8.7%

Managment guided
8.5% EBIDTA margin
for the FY17

5.1%

1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16 1QFY17 2QFY17

Finance Cost As % of Sales


5%
4%

4%

4%

4%

4%

4%
3%

4%

3%

3%

3%

2.8%

3%

3%

Finance cost will be 3%


and 2.7% of sales in
Fy17 & FY18
respectively.

2%
2%

1%
1%
0%

1QFY15

2QFY15

3QFY15

4QFY15

1QFY16

2QFY16

3QFY16

4QFY16

1QFY17

2QFY17

About the Company


KEC International Limited is an India-based company, engaged in infrastructure engineering,
procurement and construction (EPC). The Company is also a manufacturer of power cables and
telecom cables in India. The Company operates in four business verticals, which include power
transmission and distribution, cables, railways and water. The Company is also a provider of turnkey
solution in the railway infrastructure EPC space. The Company has powered infrastructure development
across 50 countries in developed, developing and emerging economies of South Asia, the Middle East,
Africa, Central Asia, the United States and South East Asia. The Company has eight manufacturing
facilities for lattice towers, monopoles, hardware and cables. The Companys manufacturing facilities
located at Vadodara (Gujarat), Mysore (Karnataka) and Silvassa (Union Territory) in India.
Narnolia Securities Ltd
Please refer to the Disclaimers at the end of this Report

24

Financials Snap Shot


INCOME STATEMENT
Revenue
Other Income
Total Revenue
COGS
GPM
Other Expenses
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
PBT
Tax
Tax Rate (%)
Reported PAT
Dividend Paid
No. of Shares

FY14
7902
14
7916
4099
48%
883
493
6%
71
423
263
173
88
51%
67
15
26

Share Capital
Reserves
Net Worth
Long term Debt
Short term Debt
Deferred Tax
Total Capital Employed
Net Fixed Assets
Capital WIP
Debtors
Cash & Bank Balances
Trade payables
Total Provisions
Net Current Assets
Total Assets

FY14
51
1140
1192
603
1207
73
1794
992
18
3808
144
3213
125
1374
7411

FY15
8468
146
8614
4566
46%
917
512
6%
88
424
309
261
100
38%
161
18
26

FY16
8516
10
8527
4148
51%
975
679
8%
88
592
277
325
133
41%
192
57
26

FY17E
8943
10
8954
4561
51%
1020
760
9%
84
676
274
412
144
35%
268
80
26

EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Price / Book Value
Dividend Yield (%)
Profitability Ratios
RoE
RoCE
Turnover Ratios
Asset Turnover (x)
Debtors (No. of Days)
Inventory (No. of Days)
Creditors (No. of Days)
Net Debt/Equity (x)

RATIOS

FY14
2.6
46.3
0.6
23%

FY15
6.3
51.7
0.7
11%

FY16
7.4
58.8
2.2
30%

FY17E
10.4
66.1
3.1
30%

26.0
1.5
0.87%

12.8
1.5
0.88%

16.4
2.1
1.82%

15.8
2.5
1.88%

6%
24%

12%
20%

13%
28%

16%
29%

1.1
175.9
45.0
148.4
0.51

1.1
166.1
38.1
143.3
0.55

1.0
192.6
37.8
126.0
0.40

1.1
193.0
38.0
126.0
0.35

FY14
155
71
113
499
(9)
161
(136)
305
263
15
132
(14)
146
132

CASH FLOW
FY15
FY16
261
325
88
88
122
135
596
853
153
(51)
90
78
125
18
640
264
309
277
17
58
(216)
(63)
62
(96)
132
194
194
98

FY17E
412
84
144
770
478
0
0
0
274
80
(354)
124
111
235

BALANCE SHEET

FY15
51
1278
1330
737
1308
70
2067
881
16
3853
206
3325
122
1668
7745

FY16
51
1460
1512
602
1723
66
2114
860
12
4495
111
2939
114
2151
8138

FY17E
51
1648
1700
602
1723
66
2302
860
0
4729
0
3087
114
2187
8322

OP/(Loss) before Tax


Depreciation
Direct Taxes Paid
Op. before WC Change
CF from Op. Activity
Capex
CF from Inv. Activity
Repayment of LTB
Interest Paid
Divd Paid (incl Tax)
CF from Fin. Activity
Inc/(Dec) in Cash
Add: Opening Balance
Closing Balance

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

25

BUY
MAHINDRA & MAHINDRA LIMITED
Result Update
CMP

1221

Target Price

1600

Previous Target Price


Upside

31%

Change from Previous

Market Data
BSE Code

500520

NSE Symbol

M&M

52wk Range H/L

1509/1092

Mkt Capital (Rs Cr)

75,845

Av. Volume

90339

Nifty

8,191

1Month

1Year

YTD

Absolute

3.9

-12.7

-1.9

Rel.to Nifty

3.3

-6.4

-7.0

2QFY17 1QFY17

PAT Margin was increased by 230 bps YoY to 11% because of higher other
income which came in the form of special dividend received from Tech M,
Mahindra holidays and Swaraj Engines.

4QFY16

26.8

26.8

26.9

73.2
-100.0

73.2
-100.0

73.1
-100.0

Company Vs NIFTY
125

2QFY17 Result Highlights

EBITDA Margin improved by 70 bps YoY to 11.6% due to higher sales of


tractors during the quarter.

Share Holding Pattern-%

Public
Others
Total

M&M posted strong volume growth in the Farm Equipment segment with a
growth of 22% YoY during the 3QFY17. Good Monsoon and recovery in the
rural areas helped the company to garner strong growth in this quarter. M&M
commands 43% market share in the tractor segment putting Mahindra and
Swaraj brands together. Management expects rural demand to remain robust
on good monsoon. Growing competitiveness in the utility vehicle segment is a
concern for Mahindra because earlier launches by Maruti & Hyundai have taken
the large share from the market leader. The market share has reduced to 29%
from 35% in the UV segment. We assume that M&M will further respond to the
changing dynamics in the utility vehicle segment going ahead. Recovery in the
Ssangyong is a good sign for UV segment. Going forward, the management
has guided for 15-20% growth in the UV segment, 20% growth for tractor
industry and single digit for the commercial vehicle space in FY17.

M&M have reported 14% YoY growth in net revenue in 2QFY17 due to 12%
growth in Automotive and 36% growth in Farm Equipment segment.

Stock Performance

Promoter

5-Jan-17

M&M

NIFTY

120

115
110
105

Outlook
Management believes that the demonetization issue may have short term
negative impact on Farm Equipment segment. They expect this concern will
last for next 4 months but sticks with previous growth guidance of 20% for
tractor industry in FY17. We believe that the tractor industry may not see much
slow-down because the monsoon was good during the year and almost 90% of
the tractors are financed. New launches in 2HFY18 in Tractor and SUV
segments will make the Mahindras presence further stronger in the domestic
market. Ssangyong have also seen recovery on nine month basis and it may
post positive results in the current fiscal after three consecutive years of losses.
Considering the strong volume growth and recovery in the non- performing
business we recommend 'BUY' with a target price of Rs.1600.

100

Rs. In crore

95
90
85

Jan-17

Dec-16

Nov-16

Oct-16

Sep-16

Jul-16

Aug-16

Jun-16

Apr-16

May-16

Jan-16

Mar-16

Dec-15

80

Naveen Kumar Dubey

Financials

2QFY17

1QFY17

2QFY16

QoQ

YoY

Sales
EBITDA
Net Profit
EBIDTA%
PAT %

10609
1233
1163
11.6%
11.0%

11041
1286
955
11.6%
8.7%

9276
1008
915
10.9%
9.9%

-4%
-4%
22%

14%
22%
27%

naveen.dubey@narnolia.com
Narnolia Securities Ltd
Please refer to the Disclaimers at the end of this Report

26

M&M
Investment Arguments
Monsoon has played a significant role in shaping the rural demand in favour of M&M, because about 90% of the tractors and
more than 40% of the utility vehicles have been sold in rural areas by the company. So M&M remains the big beneficiary of
improving rural demand in long run.
Recently launched "Yuvo" brand tractors have made the Farm Equipment segment portfolio stronger and M&M is all set to take
advantage of growing demand of 41-50 HP tractors. This category contributes more than 45% of total tractor sales.
The Company has built adequate manufacturing capacity for the immediate future and is planning to invest in additional capacity
in preparation for the mid to long term.
The company is strengthening its presence in neighbouring markets of Sri Lanka and Bangladesh.
Ssangyong have also seen recovery on nine month basis and it may post positive results in the current fiscal after three
consecutive years of losses. It can be a new growth driver for M&M in utility vehicles segment and this could lead further expansion
in margins of the company going ahead.

Management Highlights
There will be short term negative impact of demonetization on the farm equipment segment and the management expects that
this concern may last for next 4 months.
Rural economy looks positive for Q3 & Q4 on good monsoon. 20% industry volume growth in Tractor segment for FY17.
80-85 percent UVs and 90% Tractors are financed through Banks & NBFCs.
15-20 percent growth in UV segment in next 6 months.
CV segment will end up high single digit for the rest of the year.
There will not be significant price change in the truck segment due to GST.
Other income was higher due to special dividend received from Tech M, Mahindra holidays and Swaraj Engines,
The company will be llaunching 2 new vehicles in UV segment in Q2FY18.
Ssangyong has a capital expenditure plan of more than $700 million for the next three-four years to bring out one new product
every year.
Mahindra and the Ssangyong version of the SUV will drive the Korean brands ambitious entry into the North American market by
2020.

Sustainable growth in Farm Equipment Segment


Farm Equipment Segment

36%

40%
22%

20%
0%

5%

3%

30%
20%

12%

10%
0%

76486

61658

74595

43321

-10%

62666

45246

-16% -26%

62358

38604

59714

61152

-24% -30%

74555

90000
80000
70000
60000
50000
40000
30000
20000
10000
0

Growth

-20%

-30%
-40%

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

27

M&M
Financials Snap Shot

Net Revenue
Other Income
Total Revenue
COGS
GPM
Other Expenses
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
PBT
Tax
Tax Rate (%)
Reported PAT
Dividend Paid
No. of Shares

FY13
68,693
389
69,082
41,892
39%
11,132
9,116
13%
2,080
7,036
2,297
5,128
1,935
38%
4,099
934
61

INCOME STATEMENT
FY14
FY15
74,001
71,949
505
525
74,506
72,474
44,893
42,850
39%
40%
12,342
13,444
10,120
8,793
14%
12%
2,170
2,124
7,951
6,669
2,954
3,157
5,502
4,038
1,496
1,720
27%
43%
4,667
3,137
1,009
872
62
62

Share Capital
Reserves
Net Worth
Long term Debt
Short term Debt
Deferred Tax
Total Capital Employed
Net Fixed Assets
Capital WIP
Debtors
Cash & Bank Balances
Trade payables
Total Provisions
Net Current Assets
Total Assets

FY13
295
19,666
19,961
19,860
3,368
894
39,821
17,941
1,120
5,177
4,937
11,911
4,286
11,462
76,470

BALANCE SHEET
FY14
FY15
295
296
23,012
25,561
23,307
25,856
25,492
22,327
2,781
7,177
1,202
1,287
48,799
48,183
19,228
21,315
1,244
1,273
5,725
5,476
6,523
4,912
11,800
11,355
5,089
5,654
14,817
13,195
88,270
94,844

FY16
78,016
541
78,557
45,340
42%
15,036
9,647
12%
2,582
7,066
3,373
4,234
1,864
44%
3,211
872
62

FY16
296
28,323
28,620
25,096
8,251
1,552
53,716
24,186
806
6,419
4,906
13,628
5,901
14,739
108,223

EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Price / Book Value
Dividend Yield (%)
Profitability Ratios
RoE
RoCE
Turnover Ratios
Asset Turnover (x)
Debtors (No. of Days)
Inventory (No. of Days)
Creditors (No. of Days)
Net Debt/Equity (x)

FY13
67
325
15.2
23%

Please refer to the Disclaimers at the end of this Report

FY16
52
461
14.0
27%

4.0
0.8
5.63%

6.3
1.3
3.43%

12.8
1.6
2.16%

23.4
2.6
1.16%

21%
18%

20%
16%

12%
14%

11%
13%

0.9
27.5
73.3
63.3
1.0

FY13
OP/(Loss) before Tax
5,128
Depreciation
2,085
Direct Taxes Paid
(1,781)
OP before WC changes
7,663
CF from Op. Activity
(922)
(45,661)
Capex
(3,291)
CF from Inv. Activity
(2,788)
Repayment of Long Term Borrowings
(54,392)
Interest Paid
(638)
Divd Paid (incl Tax)
(997)
CF from Fin. Activity
4,508
Inc/(Dec) in Cash
799
Add: Opening Balance
3,139
Closing Balance
3,823

Narnolia Securities Ltd

RATIOS
FY14
FY15
76
51
378
416
16.4
14.0
22%
28%

0.8
28.2
67.9
58.2
1.1

0.8
27.8
72.0
57.6
0.9

30.0
85.6
63.8
0.9

CASH FLOW STATEMENT


FY14
FY15
FY16
5,502
4,038
4,234
2,175
2,128
2,612
(1,275)
(1,701)
(2,044)
8,086
6,454
7,252
(244)
1,055
971
(66,102) (80,047) (88,000)
(3,665)
(4,759)
(4,334)
(4,490)
(4,444)
(5,238)
(53,265) (45,084) (94,098)
(583)
(489)
(541)
(1,094)
(1,200)
(1,068)
5,577
1,669
3,971
844
(1,720)
(296)
3,823
4,633
3,000
4,633
2,720
2,792

28

BUY
MARUTI SUZUKI INDIA LIMITED

3-Jan-17

Result Update
CMP

5466

Target Price

6100

Previous Target Price


Upside

12%

Change from Previous

Market Data
BSE Code

532500

NSE Symbol

MARUTI

52wk Range H/L

5972/3202

Mkt Capital (Rs Cr)

165120

Av. Volume

52910

Nifty

8,180

Stock Performance
1Month

1Year

YTD

Absolute

7.8

-3.8

18.4

Rel.to Nifty

6.7

2.6

15.5

Royalty stood at Rs.1088 crore (6.1% of sales) during the quarter due to
appreciation in Yen.

4QFY16

56.2

56.2

56.2

43.8
-100.0

43.8
-100.0

43.8
-100.0

Company Vs NIFTY
140

Maruti reported Rs.17843 crore of net sales in 2QFY17 a growth of 29% over
previous year. This was driven by 18% volume growth and 9% realization
growth YoY.

Maruti reported a PAT of Rs.2398 crore a growth of 60.2% YoY on account


of higher other income in the quarter.

2QFY17 1QFY17

Public
Others
Total

2QFY17 Result Highlights

EBITDA margin improved to 17% by 150bps YoY higher steel prices and
employee cost.

Share Holding Pattern-%


Promoter

Maruti reported 3% growth in sales volume in the 3QFY17, despite the


current demonetisation issue. Domestic volumes grew by 4% on account of
higher sales of premium segment cars (Baleno and Brezza). Exports have
shown 1% of de-growth YoY primarily led by currency issue in various
countries and higher import duty imposition by Sri-Lankan government on
800-1000 cc cars. Realization improved on account of better product mix and
price increase during the quarter. Management has stated that the first phase
of the Gujarat plant will begin its commercial production in 4QFY17 and this
plant will take care of new models and the exports. There will be some cost
pressure going ahead due to higher depreciation and fixed cost on new
plant. The management is also exploring new geogarphies to expand it reach
in Latin American and Europen market.

MARUTI

NIFTY

130
120

Outlook
We expect current demonetization issue may not be impacting much in the
long run to the passenger vehicle segment because more than 75% vehicles
are financed. But this issue may be hampering sales in near future due to
cash crunch in the economy. We assume volumes in the second half may be
down by 10% in comparison to the first half 2017. Higher sales of premium
segment cars will further increase the realization per car, which will in turn
maintain the margins going ahead despite the rising commodity prices.
Hence we have positive view on this stock and we recommend "BUY" with a
target price of Rs.6100.

110

Rs. In crore
100
90

Dec-16

Nov-16

Oct-16

Sep-16

Jul-16

Aug-16

Jun-16

May-16

Apr-16

Mar-16

Jan-16

Feb-16

Dec-15

80

Naveen Kumar Dubey

Financials

2QFY17

1QFY17

2QFY16

QoQ

YoY

Sales
EBITDA
Net Profit
EBIDTA%
PAT %

17843
3037
2398
17.0%
13.4%

14927
2216
1486
14.8%
10.0%

13851
2245
1497
16.2%
10.8%

20%
37%
61%

29%
35%
60%

naveen.dubey@narnolia.com
Narnolia Securities Ltd,

29

MARUTI
Investment Arguments
In the recent past a series of new product launches have been successful for the company. It was a strategic decision to enter in
those segments where it has very few or no products. The same way the company is planning to launch 15 new products till 2020.
Maruti is onset to unleash the potential in the international business by targeting European and Latin American markets. Recently
launched and upcoming new products are technologically sound and competent to the export markets.
Gujarat plant will begin its commercial production in 4QFY17 and this plant will take care of new models and the exports. It will
take 6 months to ramp up the production and there will be some cost pressure going ahead due to higher depreciation and fixed
cost on new plant.
Maruti is also aggressively working towards bringing down the import content in its cars from an average 16% at the end of FY16
to 10% as part of its vision 2.0 plan. Currently about 14 percent of imports are yen denominated. Management expects to bring it
down to 5 percent. Typically, 1% movement in yen leads to around 1% change in the operating profit of Maruti.

Management Highlights
Lower double digit growth guidance for FY17 due to current demonetisation issue. 25% decline in retail sales in rural areas and
25% enquiries have been impacted in urban areas.
Maximum impact on taxi part, specially Ola and Uber. They contributes to 30% of the volumes.
Export may remain flat in FY17
Management expects 50000 Baleno's to be exported to Japan. Apart from Japan, the vehicle is being exported to Europe,
Australia, New Zealand and Latin America.
Maruti's newly launched light commercial vehicle, Super Carry, is also exported to South Africa and Tanzania and will be exported
to SAARC countries in the future.
Gujarat plant is likely to be commissioned in Q4FY17. Management expects it will take 6 months to ramp up.
Steel prices have started going up and its impact may be seen in second half of the year.
Margins can come under pressure once the Gujarat plant becomes operational due to higher fixed cost and depreciation.
Capex- Rs.4500 crore,(Rs.2000 crore for maintenace and R&D, Rs.1000 crore on marketing expenses and Rs.1500 crore on
product development.
The waiting period for Brezza is 27 weeks and for Baleno 33 weeks. Maruti has increased the production for Baleno by 25% to
meet customer requirements.
The company has 15 new models in the pipeline, which will come out by 2020.

Volumes Trend
Volume

Volume Growth

18%

17%
16%

2%

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

387251

4%

418,470

374182

353335

341329

7%

346712

323,911

321,898

10%

348443

13%

360402

14%

12%

299,894

450,000
400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
-

3%

20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%

30

MARUTI
Financials Snap Shot

FY14
Revenue (Net of Excise Duty)44,451
Other Income
831
Total Revenue
45,281
COGS
31,853
GPM
28%
Other Expenses
5,970
EBITDA
5,204
EBITDA Margin (%)
12%
Depreciation
2,116
EBIT
3,088
Interest
185
PBT
3,734
Tax
902
Tax Rate (%)
24%
Reported PAT
2,855
Dividend Paid
424
No. of Shares
30

Share Capital
Reserves
Net Worth
Long term Debt
Short term Debt
Deferred Tax
Total Capital Employed
Net Fixed Assets
Capital WIP
Debtors
Cash & Bank Balances
Trade payables
Total Provisions
Net Current Assets
Total Assets

FY14
151
21,345
21,496
627
1,238
596
22,124
13,673
2,640
1,489
649
5,000
873
7,561
31,411

INCOME STATEMENT
FY15
FY16
50,801
58,612
865
472
51,666
59,084
35,615
39,318
30%
33%
6,741
8,115
6,844
9,119
13%
16%
2,515
2,867
4,329
6,252
218
94
4,976
6,630
1,185
1,999
24%
30%
3,807
4,699
884
1,237
30
30

FY17E
65,460
134
65,594
44,348
32%
8,709
10,068
15%
2,425
7,643
67
7,710
2,513
33%
5,266
1,386
30

EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Price / Book Value
Dividend Yield (%)
Profitability Ratios
RoE
RoCE
Turnover Ratios
Asset Turnover (x)
Debtors (No. of Days)
Inventory (No. of Days)
Creditors (No. of Days)
Net Debt/Equity (x)

BALANCE SHEET
FY15
FY16
151
151
24,167
27,598
24,318
27,749
278
147
53
91
484
475
24,597
27,896
14,380
13,989
1,890
1,013
1,144
1,387
43
77
5,657
7,127
1,652
2,137
(234)
(3,965)
34,479
40,270

FY17E
151
31,477
31,628
147
101
475
31,775
15,178
1,549
551
7,960
2,391
(3,850)
45,529

FY14
OP/(Loss) before Tax
3,734
Depreciation
2,116
Direct Taxes Paid
(858)
OP before WC changes
5,111
CF from Op. Activity
4,995
(13,100)
Capex
(3,545)
CF from Inv. Activity
(4,997)
Repayment of Long Term Borrowings
(22)
Interest Paid
(170)
Divd Paid (incl Tax)
(283)
CF from Fin. Activity
(74)
Inc/(Dec) in Cash
(76)
Add: Opening Balance
165
Closing Balance
89

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

FY14
94
712
14.0
15%

RATIOS
FY15
FY16
126
156
805
919
29.3
41.0
23%
26%

FY17E
174
1,047
45.9
26%

24.0
3.2
0.62%

29.3
4.6
0.79%

23.9
4.0
1.10%

28.1
4.7
0.94%

13%
14%

16%
18%

17%
22%

17%
24%

1.4
12.2
20.2
41.1
0.0

1.5
8.2
27.4
40.6
0.0

1.5
8.6
29.7
44.4
0.0

1.4
8.6
32.0
44.4
0.0

CASH FLOW STATEMENT


FY15
FY16
FY17E
4,976
6,630
7,710
2,515
2,867
2,425
(1,075)
(1,948)
(2,513)
6,779
9,089
10,271
6,539
8,584
8,246
(17,354) (12,189)
(87)
(3,279)
(2,443)
(3,614)
(4,581)
(7,319)
(6,328)
(211)
(292)
(222)
(104)
(67)
(424)
(909)
(1,386)
(2,004)
(1,239)
(1,443)
(45)
26
474
89
43
77
43
69
551

31

ACCUMULATE
IRB Infrastructure Developers Ltd.
Result Update
CMP
Target Price
Previous Target Price
Upside
Change from Previous

196
235
20%
-

Market Data
BSE Code
NSE Symbol
52wk Range H/L
Mkt Capital (Rs Cr)
Av. Volume
Nifty

532947
IRB
269/177
6,888
159708
8104

Stock Performance
Absolute
Rel.to Nifty

1Month

3 Month

1Year

3.8
5.3

-24.4
-17.1

-20.0
-22.2

Share Holding Pattern-%


2QFY17

Promoters
Public

57%
43%

1QFY17 4QFY16

57%
43%

58%
42%

Company Vs NIFTY
120

IRB

NIFTY

2-Jan-17

Robust construction revenue visibility:IRB has reported strong construction revenue growth of 28% YoY in H1FY17
despite heavy monsoon. Current order book stands at Rs.11061Cr (including
Kishangarh-Glubpura project) i.e. 4x of FY16 construction revenue. Healthy
order book provides robust construction revenue visibility going forward.
Execution during the Q2FY17 was impacted due to heavy and extended
monsoon but we expect to ramp up in execution in the 2nd half of the year.
Ramp up in the execution of ongoing projects and Agra Etawah will drive the
EPC revenue growth in FY17 and 3 projects in Rajasthan will drive the growth
in FY18.
Arbitration awards:Recently, IRB Goa Tollway Pvt. Ltd. and IRB Ahmadabad-Vadodara super
express tollway Pvt. Ltd, wholly owned subsidiaries of the company, has won
an arbitral award of Rs. 241Cr and Rs. 20 Cr respectively. It will help the
company to reduce its debt.
InvIT will unlock Value:IRB has filed DRHP (Draft Red Hiring Prospectus) for its InvIT with SEBI and
company is in an advanced stage to get approval. IRB is in the process to
raise Rs. 4300 Cr through InvIT IPO. These proceed will be utilized for the
debt reduction and for the future projects.
Demonetization Impact: Toll collection on all national highways remains to suspend for 24 days due to
demonetization. As per our calculation, IRB lost around Rs. 150 Cr of toll
collection across all the projects. Revenue loss will be compensated by NHAI
in two parts (i) some portion in cash and (ii) balance portion will be
compensated by way of extension of the concession period. The company
does not witness any big dip in traffic post the commencement of tolling. we
expect little stretch in working capital on a consolidated level as toll collection
has impacted. Executions of projects remain stable as we do not see any
major challenges on that front.

110
100

In Rs. Cr

90
80
70
60
50
40

Sandip Jabuani
sandip.jabuani@narnolia.com

Financials
Sales
EBITDA
Depreciation
Interest
Net Profit
EBIDTA%
PAT %
TaX % of PBT

Q2FY16
1,149
605
203
240
149
53%
13%
22%

Q1FY17
1,517
774
221
328
182
51%
12%
29%

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

Q2FY17
1,291
709
227
340
142
55%
11%
19%

YoY%
12%
17%
12%
42%
-5%

QoQ%
-15%
-8%
3%
3%
-22%

32

Concall Highlights :-

No big dip in traffic post the tolling resume on all toll plaza
IRB has secured Kishangarh Udaipur project in December, after winning this project
company has completed its target of acquiring new projects of 330 km in FY17.
IRR of 16-18% on Kishangarh Udaipur project after premium payment to NHAI
IRB is pre-qualified in project worth Rs. 16600 Cr.
The company aims to win 300 km project (including 230 km already won)
NHAI and related State authority will compensate revenue loss by way of adjusting
premium and revenue share payment.
Current Toll collection at Agra-Etwah project is 35lakh/day and likely to go up by 4550% post full completion of the project
IRB has filed DRHP of InvIT and waiting for the Sebis replay and expect to lunch in
January
The Company will have to infuse equity of Rs. 1600-1800 Cr over period of two years.
Tax reversal of Rs.15-18 Cr in Q2FY17
Solapur- Yedeshi and Kaithal Rajasthan project will gets complete by H1FY18
Company has received appointment date for the 1)Gulabpura- Chittorgarh and
Udaipur- Gujarat Border project and work will start from 1 st april 2017

Outlook and Valuation :Firstly EPC revenue was impacted due to heavy monsoon during Q2FY17 and secondly
suspension of toll collection for the period of 24 days because of demonetization will
affect the top line of the company in FY17. We expect top line of Rs. 5627 Cr (Growth of
10% YoY) with healthy 52.7% EBITDA margin in FY17E. Significant reduction in debt post
the InvIT IPO and an arbitral award will boost the bottom line of the company. At a current
price of Rs. 191 stock trades at 7.3x to FY17 expected EV/EBITDA and 1.3x to P/B. The
stock has corrected nearly 18% post demonetization announcement which makes this
stock attractive at this price with present fundamentals. Hence, we revised our rating
from HOLD to ACCUMULATE with target price of Rs.235

About the Comapny :IRB Infrastructure Developers Limited is a road buildoperatetransfer (BOT) operator.
The Company's principal activity is the construction and maintenance of roads. Its
business segments include Road Infrastructure Projects, which includes development and
operation of roadways; Real Estate, which includes real estate development, and Others,
which includes windmill (sale of electricity generated by windmill), hospitality and airport
infrastructure. Its construction business complements its BOT vertical by executing
engineering, procurement and construction, and operation and management (O&M)
aspects of BOT concessions. It has a portfolio of over 20 Road BOT projects. It has inhouse integrated project execution capabilities in both its business verticals, including
construction, and operation and maintenance of highways.
Narnolia Securities Ltd
Please refer to the Disclaimers at the end of this Report

33

Order Book
Order book

Book to bill

17
15

12

10

9,746

17,321

11,468

12,116

12,631

12,954

11,587

11,348

11,974

7,795

8,739

11

10

14

12

11,394

12

7,030

20,000
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
-

20
18
16
15
14
12
10
8
6
4
2
-

Comapny has received


appointment date and start work
from 1st April 2017

As % of Order Book
8%

Work on Agra Ethawah project


(Rs.2133 Cr) has started from
August 2016 onwards and we
expect ramp up in H2FY17

13%

Yedeshi Aurangabad
Kaithal Rajasthan Border

6%

16%

2%

2%

Solapur Yedeshi
Sindhudurg Airport
Agra Etawah

Gulabpura -Chittorgarh
18%

18%

Udaipur -Gj Border


O & M Contracts
Goa Kundapur

17%

Revenue Mix

1,200

Construction

BOT Toll

70%

EBITDA M

60%

1,000

56%

800
600

45%

50%

59%

58%

58%

57%

50%

53%

52%

48%

51%

56%

40%
30%

400

755
569

913
601

978
593

808
524

703
476

613
524

516
503

510
483

477
435

606
431

598
320

591
315

20%

690
277

200

50%

10%
0%

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

34

Financials Snap Shot


INCOME STATEMENT
Net Revenue
Other Income
Total Revenue
COGS
GPM
Other Expenses
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
PBT
Tax
Tax Rate (%)
Reported PAT
Dividend Paid
No. of Shares

FY14
3732
121
3853
1650
0
148
1754
47%
477
1277
756
642
182
28%
459
194
33

FY15
3847
113
3960
1306
0
140
2212
57%
707
1505
931
686
144
21%
543
164
35

FY16
5130
124
5254
2054
0
170
2661
52%
853
1807
1063
868
232
27%
636
164
35

RATIOS

FY17E
5627
128
5755
0
0
0
2965
53%
903
2062
1347
843
194
23%
647
164
35

EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Price / Book Value
Dividend Yield (%)
Profitability Ratios
RoE
RoCE
Turnover Ratios
Asset Turnover (x)
Debtors (No. of Days)
Inventory (No. of Days)
Creditors (No. of Days)
Net Debt/Equity (x)

FY14
14
107
6
42%

FY15
15
124
5
30%

FY16
18
137
5
26%

FY17E
18
151
5
25%

7
1
5.66%

15
2
2.00%

13
2
2.01%

10
1
2.45%

13%
9%

12%
10%

13%
10%

12%
10%

0.2
0.5
59.4
39.9
2.64

0.1
0.5
72.6
22.2
2.48

0.1
7.4
54.9
21.7
2.62

0.1
7.4
54.9
21.7
2.85

BALANCE SHEET
Share Capital
Reserves
Net Worth
Long term Debt
Short term Debt
Deferred Tax
Total Capital Employed
Net Fixed Assets
Capital WIP
Debtors
Cash & Bank Balances
Trade payables
Total Provisions
Net Current Assets
Total Assets

FY14
332
3228
3561
9398
897
22
12959
13041
48
6
1501
408
289
879
15712

FY15
351
4009
4361
10804
631
19
15165
36599
80
5
1580
234
219
477
39393

FY16
351
4476
4827
12652
1189
16
17479
39169
78
104
1559
305
169
510
42181

CASH FLOW

FY17E
351
4958
5309
15117
1189
16
20427
40594
78
114
0
335
322
-1378
42088

OP/(Loss) before Tax


Depreciation
Direct Taxes Paid
Op. before WC change
CF from Op. Activity
Non Current Investment
Capex
CF from Inv. Activity
Repayment of LTB
Interest Paid
Divd Paid (incl Tax)
CF from Fin. Activity
Inc/(Dec) in Cash
Add: Opening Balance
Closing Balance

Narnolia Securities Ltd


Please refer to the Disclaimers at the end of this Report

FY14
642
477
232
1749
1656
0
3002
(2743)
888
740
194
1274
186
257
443

FY15
686
707
216
2216
1823
1
2311
(2295)
794
1317
78
474
2
443
445

FY16
868
853
312
2719
2342
0
3161
(3175)
1140
1435
254
667
(165)
445
279

35

FY17E
841
903
194
3091
2116
0
2328
(2328)
0
1347
164
954
742
1559
2301

Narnolia Securities Ltd


201 | 2nd Floor | Marble Arch Building | 236B-AJC Bose Road |
Kolkata-700 020 , Ph : 033-40501500
email: narnolia@narnolia.com, website
: www.narnolia.com

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should use their own judgment for taking any investment decisions keeping in mind that
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