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HimadriSpecialityChemicals

Allsetforthenextleap
We met Himadri Speciality Chemicals (HSC) management to get an update on
July07,2017
companysgrowthprospects.HSCisafullyintegratedspecialitycarboncompany
and manufactures coal tar pitch (CTP), carbon black and naphthalene. The
AvishekDatta
companyhas70%domesticmarketshareinCTPand17%shareincarbonblack.
avishekdatta@plindia.com
Strong momentum in core business along with limited capex will help HSC to

VisitUpdate
+912266322254
deleverage its balance sheet further and open up growth opportunities. Also,
their decade old effort on advanced carbon material is set to take off going
forwardwhichcanputthecompanyintoadifferentleague.

Corebusinessinfinefettle:HSCwith0.4MTPAcapacityincoaltardistillation
will benefit from revival in domestic aluminium industry (current capacity
Rating NotRated
~3MTPA)1MTPA capacity is to come on stream over next three years. CTP
Price Rs74
demand is expected to ride on the back of healthy growth in downstream
TargetPrice NA
industry. HSC has also developed speciality carbon black (5% of portfolio)
ImpliedUpside NA
which finds usage in pipes, engineering plastics, coatings etc. With speciality
Sensex 31,369
carbon contribution nearly 3x normal carbon black, the company is
Nifty 9,675
consciouslymovingupthevaluechain.
(PricesasonJuly06,2017)
Advanced carbon materialthe game changer: HSC to optimise on its deep
carbon chemistry knowhow has over time moved into value added products
Tradingdata bysupplyinganodematerial(currentlyontrialproduction)forlithiumbattery
MarketCap.(Rsbn) 31.5 opportunity in China. Lithium battery space is one of the fastest growing
Shareso/s(m) 418.4 opportunitieswithstrongdemandfromelectronicsandelectricvehicles,HSCs
3MAvg.Dailyvalue(Rsm) 99.3 productapprovalcouldbethenextgrowthdriverforthecompany.
Majorshareholders
BrightFutureAhead:HSCsprofitabilitywasearlierhitby1)stressindomestic
Promoters 37.35%
aluminium industry 2) fall in naphthalene realisation due to dumping from
Foreign 3.58%
Chinese and 3) forex loss of Rs4.3bn over FY1117. However, revival in core
DomesticInst. 1.82% businessalongwithforayintohighvalueaddedproductsaugurswellforthe
Public&Other 57.25% company. Strong business tailwind along with limited capex will help the
StockPerformance companyfurthertrimitsdebtlevel;Rs5bnpaidoffoverFY1117,currentnet
(%) 1M 6M 12M D/E 0.7x. With the better business environment, new opportunity in Lithium
Absolute 22.2 92.8 111.0 Batteries,thestockatthecurrentpriceofRs74,thestockat15xEV/EFY17
Relative 22.8 76.7 95.6 looksinterestingandhasgoodpotential.
HowwedifferfromConsensus
Keyfinancials(Y/eMarch) 2014 2015 2016 2017
EPS(Rs) PL Cons. %Diff.
Revenues(Rsm) 13,633 13,775 11,518 13,242
2018 NA NA NA

Growth(%) 4.9 1.0 (16.4) 15.0
2019 NA NA NA
EBITDA(Rsm) 1,721 1,228 9,490 2,470

PAT(Rsm) (462) (144) 7,797 812


PricePerformance(RIC:HIMD.BO,BB:HSCHIN) EPS(Rs) (1.0) (0.4) 18.6 1.9
(Rs) Growth(%) NA NA NA (89.6)
90
80
70 Profitability&Valuation 2014 2015 2016 2017
60 EBITDAmargin(%) 12.6 8.9 82.4 18.7
50
40 RoE(%) (4.5) (1.7) 89.2 8.1
30 RoCE(%) 4.8 2.9 41.7 10.2
20
EV/sales(x) 2.9 2.8 3.3 2.8
10
0 EV/EBITDA(x) 23.1 31.6 4.0 15.0
Nov16
Jul16

Jul17
Sep16

Mar17
Jan17

May17

PE(x) NA NA 4.1 39.2


P/BV(x) 3.5 3.5 3.5 2.9

Source:Bloomberg Source:CompanyData;PLResearch

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Pleaserefertoimportantdisclosuresanddisclaimersattheendofthereport
HimadriSpecialityChemicals

Largestintegratedcoaltarpitchplayer

HImadriisIndiaslargestverticallyintegratedcoaltarpitchmanufacturingcompany.
Thecompanyhasadiversifiedproductportfoliowithpresenceacrosscarbonvalue
chain and manufactures coal tar pitch (CTP), carbon black and naphthalene. The
companyhas70%marketshareinCTPandhad17%shareincarbonblackbusiness.
HSCalsohasIndiaslargestSulphonatedNaphthaleneFormaldehyde(SNF)capacity
with68,000tons.

Exhibit1: Himadrichemicalscapacity(MT)
CTP 400,000
CarbonBlack 120,000
SNF 68,000

Source:CompanyData,PLResearch

CoalTarPitch

CTPismadeoutofcoaltar,abyproductgeneratedwhileprocessingcokingcoalinto
lowashmetallurgicalcokeinarecoverytypecokeovenplant.Coaltaraccountsfor
around 3.54% of coke produced. Coal tar pitch is obtained through coal tar
distillation,whichinvolvestheconversionofcoaltarintoavarietyofintermediate
chemicalproducts.

CTPfindsextensiveusageintheAluminiumandGraphiteindustryanddemandisset
torideonrisingdomesticaluminiumindustrycapacity;1MTPAofnewcapacitywill
come on stream over next three years. This will create incremental demand of
0.1MTPA demand for CTP. HSC with 70% domestic market share is well poised to
cater to the demand. HSC has coal distillation capacity of 4,00,000tons and is
currently operating at near full capacity. To meet increased future demand HSC
planstodebottleneckatacapexof~Rs200m.

Exhibit2: Coaltarpitchhasvariedapplications
Aluminiumgradepitch InprebakedanodeandSoderberginaluminiummanufacture
GraphiteGradebinderpitch Ingraphiteelectrodemanufacture
GraphiteGradezeroQIcoaltarimpregnatingpitch Ingraphiteelectrode,nippleimpregnationandUHPgradeelectrodemanufacture
Mesophasepitch Inneedlecoke,carbon/carboncomposites,advancedcarbonmaterialandcarbonfibres
Specialpitches Inrefractoriescarbonpaste,paints/ultramarineblueandwaterproofing,amongothers

Source:CompanyData,PLResearch


July07,2017 2
HimadriSpecialityChemicals

Exhibit3: Coaltardistillationcapacityhasmovedupovertime

450,000
400,000 400,000 400,000
400,000
350,000
300,000
250,000 250,000 250,000 262,500
250,000

(MT)
200,000
150,000
100,000
50,000

FY11 FY12 FY13 FY14 FY15 FY16 FY17

Source:CompanyData,PLResearch

Carbonblack

Carbonblackfindsextensiveusageintyresandnontyressegment.HSCsupplies70%
of its carbon black production for tyre industry while the rest is for nontyre like
conveyorbeltsetc.IndiantyreindustryscurrentsizeisRs500bnandprojectsworth
Rs210bn are scheduled to come on stream over FY1821E. Domestic carbon black
industry is on an upswing supported by better utilisation post imposition of anti
dumpingdutyandlowerfeedstockpricesduetodropincrudeoilprices.

HSChasovertimeforwardintegratedtoconvertCoalTarOilintocarbonblack.The
company is the third largest domestic carbon black producer with capacity of
1,20,000tons.

Exhibit4: HimadriisthethirdlargestcarbonblackplayerinIndia

500 472

400
315
300
(MT)

200
120
85
100
36

0
PhillipsCarbon SKIIndia Himadri CCIL RalsonCarbon
BlackLtd

Source:PLResearch


July07,2017 3
HimadriSpecialityChemicals

HSC has also forward integrated into speciality carbon black which finds usage in
plastic masterbatch, fibre, pipes, engineering plastics etc. Speciality carbon black
currentlyaccountsfor~5%oftotalcarbonblackportfolio.Supportedbyhighervalue
added products and customer profiling, the company expects to earn incremental
profitofRs200minFY18E.

Exhibit5: HSCcarbonblackcapacityhasmovedupovertime

150,000

120,000 120,000 120,000 120,000 120,000


120,000
102,500

90,000
(MT)

60,000 50,000

30,000


FY11 FY12 FY13 FY14 FY15 FY16 FY17

Source:CompanyData,PLResearch

Naphthalene

HSC also makes naphthalene, one of the products of coal tar distillation.
Naphthalene is used for dyestuff and dyes intermediates. The company has also
forwardintegratedtoSulphonatedNaphthaleneFormaldehyde(SNF)whichisused
inconstructionindustry,agrochemicals,latexandgypsum.

Exhibit6: HimadriSNFcapacity

80,000
68,000 68,000 68,000 68,000 68,000
70,000
60,000
50,000 43,000
(MT)

40,000
30,000
18,000
20,000
10,000

FY11 FY12 FY13 FY14 FY15 FY16 FY17

Source:CompanyData,PLResearch


July07,2017 4
HimadriSpecialityChemicals

Advancedcarbonmaterialthegamechanger

HSCistheonlydomesticproducertoforwardintegratetoconvertCTPintoadvanced
carbon material. The company is also one of the few global players to have the
technology to develop anode material for lithium battery. Similar to the lead and
nickelbasedarchitecture,lithiumionusesacathode(positiveelectrode),ananode
(negativeelectrode)andelectrolyteasconductor.Thecathodeisametaloxideand
theanodeconsistsofporouscarbon.Duringdischarge,theionsflowfromtheanode
tothecathodethroughtheelectrolyteandseparator;chargereversesthedirection
andtheionsflowfromthecathodetotheanode.

Exhibit7: Ionflowinlithiumionbattery


Source:Industry,PLResearch

When the cell charges and discharges, ions shuttle between cathode (positive
electrode) and anode (negative electrode). On discharge, the anode undergoes
oxidation, or loss of electrons, and the cathode sees a reduction, or a gain of
electrons.Chargereversesthemovement.

The anode in the battery plays an important role in the overall performance of a
battery. For an effective development of a high energy density battery, the use of
highcapacityelectrodematerials(anode&cathode)isanessentialfactor.Themost
promising types of advanced batteries currently under production are based on
lithiumanodes.


July07,2017 5
HimadriSpecialityChemicals

Theadvantagesofusinglithiummetalastheanodeareasfollows:

Goodreducingagent

Highly electropositive (so higher voltage is obtained depending upon the


cathodeused)

High electrochemical equivalence High capacity (3.82Ah/g) and energy density


(1470Wh/Kg)

Goodconductingagent

Goodmechanicalstability

Easeoffabrication/compactdesign

Demand for lithium battery has been on an upswing supported by strong demand
from consumer electronics, electric cars and energy storage solutions. HSC has
investedRs540mtosetupR&Dfacilitytobetterunderstandthecarbonchemistry.
Thecompanyisoneofthefewplayerstodevelopanodematerialofbothsynthetic
and natural varieties for lithium ion batteries. The company has already started
marketingitsproductwithlithiumionbatterymakersandtointermediariesbasedin
Chinaonatrialbasis.Oncethequalityisapproved,HSCplanstorampupvolumesto
600tpafrom~50tpa.

Exhibit8: Globallithiumbatterydemand

70
62
60

50 46
(US$bn)

40 36

28
30
21
20

10
CY12 CY13 CY14 CY15 CY16

Source:CompanyData,PLResearch


July07,2017 6
HimadriSpecialityChemicals

Fewleadingglobalplayersinlithiumanodeplayare:

Shanshan Technology: Shanshan Technology (Lithiumion battery) Anode


materialindustryincludesShanghaiShanshanTechCo.,Ltd.,NewMaterialCo.,
Ltd.NingboShanshanandChenzhouShanshanNewMaterialCoLtd.Thewhole
industry contains total asset size of more than 500 million RMB, with annual
production capability of 20,000 tons.The company has greatly expanded its
productionlinetomorethan20kindsofanodematerialswhicharewidely
applied to medium-end and high-end fields of Lithium-ion battery anode
materials.Himadrihasalreadystartedsupplyingtrailproductionof~5tons
p.mtoShanshantechnologyfortheirapproval.

NEI corporation: NEI Corporation is a leading developer and manufacturer of


Lithiumion battery materials and supplies cathode, anode, and electrolyte
materials for use in lithiumion batteries. It offers battery materials, such as
lithiumtitanate,lithiummanganeseoxide,lithiumnickelcobaltaluminumoxide,
and lithium manganese nickel oxide. The company also provides protective
coatings, including selfhealing coatings, abrasion resistant coatings,
anticorrosioncoatings,coatingadditives,andthermalspraycoatings.

Cabotcorporation:CabotCorporationisaleadingglobalspecialtychemicalsand
performance materials company. The company is developing advanced
technology for use in lithium ion batteries and is also working with leading
batterymanufacturerstodevelophiendtechnology.

BASF: BASF plans to become the world's leading system supplier of functional
materialsforhighperformancebatteries.BASFstechnologyportfolioincluding
cathodematerialsandelectrolytesforlithiumionbatteries,aswellaslicensing
nickelmetalhydridetechnology.BASFplanstopartnerswithdifferentplayersto
developmaterialsandtechnologiesforcurrentandnextgenerationlithiumion
batteriesaswellasforfuturebatterysystems.

Exhibit9: Lithiumioncomparison
P/E ROE EV/E
Mktcap Price Currency
FY17 FY18 FY19 FY17 FY18 FY19 FY17 FY18 FY19
JIANGXIGANFENGLITHIUMCOA 35.6 48.9 Yuan 35.6 26.3 19.1 32.4 33.3 30.7 27.8 18.1 13.9
TIANQILITHIUMCORPA 57.0 57.3 Yuan 29.8 27.3 22.2 29.8 24.7 26.5 19.1 17.3 11.0
ORIONENGINEEREDCARBONSSA 1.2 20.3 USD 13.6 12.6 12.0 116.2 77.4 58.2 6.9 6.6 6.4
RAININDUSTRIESLTD 41.4 123.2 INR 10.1 8.3 NA 12.5 13.5 NA 6.4 5.9 NA
NINGBOSHANSHANCOLTDA 20.1 17.9 Yuan 28.1 21.4 17.6 8.8 10.5 11.2 18.4 14.1 11.3
CABOTCORP 3.3 53.1 USD 15.0 14.1 13.1 16.7 17.3 18.1 8.3 7.9 7.8

Source:Bloomberg


July07,2017 7
HimadriSpecialityChemicals

Financials

HSCoperatingprofitshasbeenvolatileduetostressintheuserindustry,especially
aluminium industry and drop in naphthalene realisation in FY15 due to Chinese
dumping. Domestic aluminium industry has operated below rated capacity due to
weak global fundamentals and rising Chinese competition. Problems in the
aluminiumindustrygotcompoundedduetoconcernsinVedantaaluminiumplant.
Also,fallinginventoryvaluefromdropincommoditypricesimpactedprofitability.

Exhibit10: BlendedEBIDTA/tonrealisationhasbeenvolatile

10,000
8,868
7,854
8,000
6,877 6,920
6,319
5,657
(Rs/Tonne)

6,000
4,893

4,000

2,000


FY12 FY13 FY14 FY15 FY16 FY17 Q4FY17

Source:CompanyData,PLResearch

However,thealuminiumindustryisonacomebacktrailanddomesticcapacityisset
to rise by 1MTPA over next three years. With 70% domestic market share, HSC is
wellpoisedtoplayanimportantroleinfuturegrowthopportunities.Also,reportsof
imposition of anti dumping duty by the Indian Government will provide downside
supporttonaphthaleneprices.

Exhibit11: Totalsalesvolume

400,000
356,902
350,000
299,137
300,000 272,771
253,254 263,151 259,968
250,000
(MT)

189,470
200,000
150,000
100,000
50,000

FY11 FY12 FY13 FY14 FY15 FY16 FY17

Source:CompanyData,PLResearch


July07,2017 8
HimadriSpecialityChemicals

Blended realisation will also get support from higher share of high value added
carbonmaterialslikespecialitycarbonblackandSNFasalsohighersalesofCTPpost
expansion.

Debtlevelscomeoffonthebackofaggressivepayoff:HSCsnetdebthadgoneup
sharplyasthecompanyhadconverteditsrupeedebttodollardenominatedoneas
thecompanyprocures~45%ofitsrawmaterialfromimports.However,sharprupee
depreciation coupled drop in domestic raw material prices impacted HSCs
profitabilityandforexlosses wereatRs4.3bnoverFY1117.Thecompanyhaspaid
offitsdebtbyoverRs5bnincludingRs1bnforcurrencyswapsoverlastsixyears.

Exhibit12: Netdebtlevelshavecomeoffsharply

12,000 11,179
9,979 10,300
10,000
7,900 8,048
8,000 7,170
(Rsm)

6,000 4,899

4,000

2,000


FY11 FY12 FY13 FY14 FY15 FY16 FY17

Source:CompanyData,PLResearch

Goingforward,thecompanydoesntexpectanyfurtherincidenceofforexlosspost
conversionofitsrupeedebtto~70%inFY17against10%inFY12.

Workingcapitalmanagementhasalsohelpedprofitability:HSCsnetworkingcapital
has come of over time to ~125 days in FY17 against 250 days in FY11. HSCs high
workingcapitalwasdueto1)highinventorywithcustomersgivendominantmarket
share with customers and 2) high share of import of raw material. However,
companyexpectsthenetworkingcapitaltocomeofffurtherduetobetterinventory
management.


July07,2017 9
HimadriSpecialityChemicals

Exhibit13: Networkingcapitalcyclehascomeoff

300
250
250
201 200
191
200
163
148

Days
150 125

100

50

0
FY11 FY12 FY13 FY14 FY15 FY16 FY17

Source:CompanyData,PLResearch

Exhibit14: FlowchartofHimadrichemicalsproduction


Source:CompanyData,PLResearch


July07,2017 10
HimadriSpecialityChemicals

IncomeStatement(Rsm) BalanceSheetAbstract(Rsm)
Y/eMarch 2014 2015 2016 2017 Y/eMarch 2014 2015 2016 2017
NetRevenue 13,633 13,775 11,518 13,242 Shareholder'sFunds 8,342 8,271 9,209 10,781
RawMaterialExpenses 10,396 10,716 8,310 8,870 TotalDebt 11,484 10,313 7,581 7,257
GrossProfit 3,236 3,059 3,209 4,372 OtherLiabilities 1,767 1,228 1,083 1,006
EmployeeCost 243 294 296 359 TotalLiabilities 21,593 19,812 17,873 19,044
OtherExpenses 1,272 1,538 1,383 1,544 NetFixedAssets 11,954 11,578 11,282 11,123
EBITDA 1,721 1,228 1,530 2,470 Goodwill
Depr.&Amortization 545 554 637 310 Investments 3,539 2,272 2,516 3,097
NetInterest 1,165 1,015 1,100 805 NetCurrentAssets 6,053 5,915 3,046 3,780
OtherIncome (639) 77 (2) (121) Cash&Equivalents 411 366 351 360
ProfitbeforeTax (629) (264) (209) 1,234 OtherCurrentAssets 8,610 7,856 5,162 6,119
TotalTax (168) (120) (45) 422 CurrentLiabilities 2,968 2,307 2,467 2,699
ProfitafterTax (462) (144) (164) 812 OtherAssets 48 46 1029 1,044
ExOditems/Min.Int. TotalAssets 21,593 19,812 17,873 19,044
Adj.PAT (462) (144) (164) 812
Avg.SharesO/S(m) 385.7 385.7 418.4 418.4
EPS(Rs.) (1.2) (0.4) (0.4) 1.9

CashFlowAbstract(Rsm) QuarterlyFinancials(Rsm)
Y/eMarch 2014 2015 2016 2017 Y/eMarch Q1FY17 Q2FY17 Q3FY17 Q4FY17
C/FfromOperations 1,448 2,121 2,960 1,426 NetRevenue 38 39 3,518 3,757
C/FfromInvesting (938) 1,294 (47) (414) EBITDA (1,065) (966) 677 725
C/FfromFinancing (1,111) (3,463) (2,792) (897) Depr.&Amortization 30 31 77 77
Inc./Dec.inCash (602) (49) 120 115 NetInterest 10 (0) 242 138
OpeningCash 774 176 127 247 OtherIncome 17 13 (50) (52)
ClosingCash 172 127 247 363 ProfitbeforeTax (1,088) (984) 307 457
TotalTax 63 72 106 153
ProfitafterTax (1,151) (1,056) 201 305
Adj.PAT (1,151) (1,056) 201 305
Source:CompanyData,PLResearch.

KeyFinancialMetrics
Y/eMarch 2014 2015 2016 2017
Growth
Revenue(%) 4.9 1.0 (16.4) 15.0
EBITDA(%) 33.6 (28.6) 672.9 (74.0)
PAT(%) NA NA NA NA
EPS(%) NA NA NA NA
Profitability
EBITDAMargin(%) 12.6 8.9 82.4 18.7
PATMargin(%) (2.9) (1.0) 67.7 6.1
RoCE(%) 4.8 2.9 41.7 10.2
RoE(%) (4.5) (1.7) 89.2 8.1
BalanceSheet
NetDebt:Equity 1.2 1.1 0.7 0.5
NetWrkngCap.(days) 166.1 149.4 121.6 105.6
Valuation
PER(x) (75.0) (203.6) 4.1 39.2
P/B(x) 3.5 3.5 3.5 2.9
EV/EBITDA(x) 23.1 31.6 4.0 15.0
EV/Sales(x) 2.9 2.8 3.3 2.8
EarningsQuality
Eff.TaxRate 0.3 0.5 (0.0) 0.3
OtherInc/PBT (0.3) (0.6) 0.0 0.1
Source:CompanyData,PLResearch.


July07,2017 11
HimadriSpecialityChemicals

PrabhudasLilladherPvt.Ltd.
3rdFloor,SadhanaHouse,570,P.B.Marg,Worli,Mumbai400018,India

Tel:(9122)66322222Fax:(9122)66322209
RatingDistributionofResearchCoverage PLsRecommendationNomenclature

50% BUY : Over15%OutperformancetoSensexover12months


43.3%
37.5% Accumulate : OutperformancetoSensexover12months
40%
%ofTotalCoverage

Reduce : UnderperformancetoSensexover12months
30% Sell : Over15%underperformancetoSensexover12months
19.2%
20% TradingBuy : Over10%absoluteupsidein1month

10% TradingSell : Over10%absolutedeclinein1month


0.0% NotRated(NR) : Nospecificcallonthestock
0%
BUY Accumulate Reduce Sell UnderReview(UR) : Ratinglikelytochangeshortly

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theforegoing,amongotherthings,maygiverisetorealorpotentialconflictsofinterest.
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suchsecuritiesandearnbrokerageorothercompensationoractasamarketmakerinthefinancialinstrumentsofthesubjectcompanyoractasanadvisororlender/borrowertothesubjectcompanyormayhaveany
otherpotentialconflictofinterestswithrespecttoanyrecommendationandotherrelatedinformationandopinions.
DISCLAIMER/DISCLOSURES(FORUSCLIENTS)
ANALYSTCERTIFICATION
Theresearchanalysts,withrespecttoeachissueranditssecuritiescoveredbytheminthisresearchreport,certifythat:Alloftheviewsexpressedinthisresearchreportaccuratelyreflecthisorherortheirpersonal
viewsaboutalloftheissuersandtheirsecurities;andNopartofhisorherortheircompensationwas,isorwillbedirectlyrelatedtothespecificrecommendationorviewsexpressedinthisresearchreport
Terms&conditionsandotherdisclosures:
ThisresearchreportisaproductofPrabhudasLilladherPvt.Ltd.,whichistheemployeroftheresearchanalyst(s)whohaspreparedtheresearchreport.Theresearchanalyst(s)preparingtheresearchreportis/are
residentoutsidetheUnitedStates(U.S.)andarenotassociatedpersonsofanyU.S.regulatedbrokerdealerandthereforetheanalyst(s)is/arenotsubjecttosupervisionbyaU.S.brokerdealer,andis/arenotrequiredto
satisfytheregulatorylicensingrequirementsofFINRAorrequiredtootherwisecomplywithU.S.rulesorregulationsregarding,amongotherthings,communicationswithasubjectcompany,publicappearancesand
tradingsecuritiesheldbyaresearchanalystaccount.
This report is intended for distribution by Prabhudas Lilladher Pvt. Ltd. only to "Major Institutional Investors" as defined by Rule 15a6(b)(4) of the U.S. Securities and Exchange Act, 1934 (the Exchange Act) and
interpretationsthereofbyU.S.SecuritiesandExchangeCommission(SEC)inrelianceonRule15a6(a)(2).IftherecipientofthisreportisnotaMajorInstitutionalInvestorasspecifiedabove,thenitshouldnotactupon
thisreportandreturnthesametothesender.Further,thisreportmaynotbecopied,duplicatedand/ortransmittedonwardtoanyU.S.person,whichisnottheMajorInstitutionalInvestor.
In reliance on the exemption from registration provided by Rule 15a6 of the Exchange Act and interpretations thereof by the SEC in order to conduct certain business with Major Institutional Investors, Prabhudas
LilladherPvt.Ltd.hasenteredintoanagreementwithaU.S.registeredbrokerdealer,MarcoPoloSecuritiesInc.("MarcoPolo").
TransactionsinsecuritiesdiscussedinthisresearchreportshouldbeeffectedthroughMarcoPolooranotherU.S.registeredbrokerdealer.


Digitally signed by RADHAKRISHNAN SREESANKAR

July07,2017 RADHAKRISHNA DN: c=IN, o=Personal, cn=RADHAKRISHNAN


SREESANKAR,
serialNumber=8859da2df03122989b585ad520865a4f
12
N SREESANKAR 59be69fbc1b7ba2c5315941f987f41de,
postalCode=400104, st=MAHARASHTRA
Date: 2017.07.07 11:53:30 +05'30'