KNR Constructions (KNRCON)

CMP: | 247 Target: | 300 (21%) Target Period: 12-18 months BUY
November 18, 2019

Execution momentum to sustain…

KNR Construction’s (KNR) revenues grew strongly by 31.2% YoY to | 546.2
crore in Q2FY20. This includes receipt of arbitration claim of | 57.1 crore
(including | 21.8 crore interest income, | 12.2 crore associated with previous

Result Update
Receivables). Adjusting for this, core revenues grew 25.6% YoY to | 523.0
Particulars
crore, above our expectation of | 438.7 crore. Adjusted EBITDA margins
Particular Amount (| crore)
were also healthy at 19.7% in Q2FY20 on account of higher revenue
contribution from high margin irrigation projects. RPAT grew 55.8% YoY to Market Capitalization 3,472.8
Total Debt 264.1
| 70.1 crore in Q2FY20, in line with our estimate of | 71.6 crore.
Cash 13.0
EV 3,724.0
Orderbook at | 6,681.8 crore as of Q2FY20 52 week H/L (|) 303/ 163
Equity capital 28.1
KNR’s order book (OB) was at a strong | 6,681.8 crore (including the recently Face value 2.0
won HAM project and Karnataka State Highways Improvement Project
(KSHIP) HAM project), implying order book-to-bill ratio of 3.1x (on TTM Key Highlights
basis). The OB consists of | 4,830.6 crore from roads division and | 1,850.4
crore from irrigation. On the new orders front, it secured order inflows (OI)  Orderbook at | 6,681.8 crore, 3.1x
worth | 1,800 crore (comprising | 1,700 crore irrigation projects and | 100 TTM revenues
crore from change in scope at certain projects). KNR is targeting incremental
OI worth | 1,000-1,500 crore in H2FY20E. Overall, we expect revenues to
 Core revenues grows 22.7% YoY to |
510.8 crore in Q2FY20
grow at 19.1% CAGR to | 3,031.1 crore in FY19-21E.
 Adjusted EBITDA margins at 19.7% in

ICICI Securities – Retail Equity Research

Adjusted EBITDA margin healthy at 19.7% in Q2FY20 Q2FY20

KNR reported adjusted EBITDA margins of 19.7% in Q2FY20 on account of  Maintain BUY with target price of
higher revenues contribution from high margin irrigation projects (| 95 crore | 300/share
in Q2FY20). Going ahead, we expect EBITDA margin of 18.3%, 18.0%
(higher band of guidance of 17-18%) in FY20E, FY21E, respectively, higher
revenue contribution from high margin irrigation projects, lower level of
subcontracting expenses and receipts of some portion claims from various
authorities.

Equity worth | 175 crore invested in three HAM projects

In Q2FY20, KNR was notified by NHAI that concession agreement for this
project was deemed terminated due to land acquisition issues, which was
expected earlier. Accordingly, net impact of | 4.0 crore was recognised as Research Analyst
exceptional item in Q2FY20. On the equity requirement front, KNR has Deepak Purswani, CFA
already infused | 175.4 crore equity towards the three HAM projects under deepak.purswani@icicisecurities.com
execution and does not need any more equity towards these projects since
balance equity will be infused by Cube Highways once 90% RoW is in place. Harsh Pathak
harsh.pathak@icicisecurities.com

Valuation & Outlook

At the CMP, KNR is trading at attractive valuations of 6.5x FY21E EV/EBITDA
and 13.0x FY21E EPS. Considering strong execution, best in class WC,
healthy balance sheet and strong return ratios, we maintain our BUY
recommendation on the stock with an SoTP target price of | 300/share.
Key Financial Summary
| crore FY17 FY18 FY19 FY20E FY21E CAGR FY19-21E
Net Sales 1,541.1 1,931.7 2,137.3 2,506.6 3,031.1 19.1%
EBITDA 229.6 386.1 427.0 458.7 545.6 13.0%
EBITDA Margin (%) 14.9 20.0 20.0 18.3 18.0
PAT 157.2 272.1 263.3 238.8 266.7 0.6%
EPS (|) 11.2 19.4 18.7 17.0 19.0
P/E (x) 22.1 12.8 13.2 14.5 13.0
EV/EBITDA (x) 15.4 9.4 8.7 7.9 6.5
RoNW (%) 17.6 23.5 18.6 14.5 14.0
RoCE (%) 18.3 20.5 19.0 16.2 17.8
Source: Company, ICICI Direct Research
 Result Update | KNR Constructions ICICI Direct Research

Exhibit 1: Variance analysis

Particulars Q2FY20 Q2FY20E Q2FY19 YoY (%) Q1FY20 QoQ (%) Comments

Topline growth led by strong execution during

Total Operating Income 546.2 466.7 416.3 31.2 464.6 17.6
the quarter
Other Income 25.6 35.0 8.8 190.1 16.8 52.3
Consumption of raw
172.1 175.5 165.2 4.2 186.0 -7.5
materials
Employee benefit expenses 36.3 26.3 24.9 45.5 27.1 33.7
Other Expenses 68.4 41.7 45.2 51.3 42.1 62.5
EBITDA 125.8 104.8 83.1 51.3 90.0 39.7
EBITDA margin optically expanded on account
of one-offs regarding claims receipts in Q2FY20.
EBITDA Margin(%) 23.0 22.5 20.0 306 bps 19.4 365 bps
Adjusted EBITDA margins were at 19.7% in
Q2FY20
Depreciation 47.5 38.9 39.3 21.0 38.9 22.3
Interest 9.8 9.0 7.4 31.5 9.0 8.0
PBT 94.1 91.9 45.3 107.8 58.9 59.7
Taxes 20.0 20.2 0.3 7454.9 11.2 NM
RPAT de-grew on account of strong topline
PAT 70.1 71.6 45.0 55.8 47.7 46.9 growth, EBITDA margins expansion and bonus
receipts in Q2FY20
Source: Company, ICICI Direct Research

Exhibit 2: Change in estimates

FY18 FY19 FY20E FY21E Comments
(| Crore) Old New % Change Old New % Change
Revenue 1,971.0 2,200.6 2,543.3 2,543.3 0.0 3,072.5 3,072.5 0.0 Maintain our estimates
EBITDA 386.1 427.0 458.7 458.7 0.0 545.6 545.6 0.0
EBITDA Margin (%) 19.6 19.4 18.0 18.0 0 bps 17.8 17.8 0 bps
PAT 272.1 263.3 238.8 238.8 0.0 266.7 266.7 0.0
Diluted EPS (|) 19.4 18.7 17.0 17.0 0.0 19.0 19.0 0.0
Source: Company, ICICI Direct Research

Exhibit 3: Assumptions
Current Current Earlier Earlier Comments
EPC FY18 FY19 FY20E FY21E FY20E FY21E
Order Inflow 4,464 1,736 2,933 5,000 2,933 5,000 Maintain our estimates
Order Backlog 6,302 5,901 6,327 8,296 6,327 8,296
Source: Company, ICICI Direct Research

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Conference call Highlights

 Awarding activity: Tendering and awarding activity has been muted in
H1FY20 on account of land acquisition and funding issues of already
awarded projects. Nonetheless, NHAI has now prioritised to complete at
least 80% land acquisition for projects that are to be floated for tendering
to avoid hiccups after the project is awarded and, hence, ensure quicker
commencement of execution. The management expects tendering &
awarding activity to pick up pace from December, 2019. NHAI has 6,000
km road project lined up for awarding in FY20E. Also, the government
intends to float tender for road projects to the tune of | 7-8 lakh crore
over the next three years

 Management guidance: KNR’s order book was at | 5,146.8 crore as of

Q2FY20. This OB does not include the KSHIP project and
Oddanchatram-Madathukulam HAM projects worth | 1,535 crore. The
company received | 1,800 crore order inflows (OI) in H1FY20 and is
looking forward to incremental | 1,000-1,500 crore OI in H2FY20E. The
management has maintained | 2,300-2,400 crore revenues and 17-18%
EBITDA margin in FY20E

 HAM projects: Execution is in full swing on three HAM projects whose

appointed date (AD) has been received. The physical progress on these
projects is: a) Trichy-Kallagam: 17.5%, b) Chittor-Mallavaram: 27.5%, c)
Ramsanpalle-Mangloor: 21.4%. For the KSHIP project, the company has
executed financial closure (FC) documents and submitted to the
authority. AD for this project is expected in Q3FY20E. For the fifth
Oddanchatram-Madathukulam HAM project, it has availability of ~65%
land. KNR is in the process of signing the concession agreement

 Terminated HAM project: In Q2FY20, KNR was notified by NHAI that the
concession agreement for this project was deemed terminated due to
land acquisition issues. Due to this, the company has written off
investments worth | 8.3 crore and written back liabilities to the tune of
| 4.3 crore. Accordingly, the net impact came in at | 4.0 crore, which is
recognised as exceptional item in Q2FY20

 Equity requirement: KNR has already infused | 175.4 crore equity

towards the three HAM projects that are being executed. It does not
need any more equity to be invested in these projects since the balance
equity will be infused by Cube Highways once 90% RoW is in place

 Taxation: KNR would follow the old tax regime as it has | 66 crore MAT
credit available, which could be utilised till FY22E. With this, the effective
tax rate would be ~20% in FY20E and ~27% in FY21E

 Debt & capex: KNR’s standalone debt was at | 316 crore as of Q2FY20
(including | 208 crore promoter loans). It aims to maintain this level of
standalone debt in FY20E. On the capex front, the company has incurred
capex worth | 142 crore in H1FY20 (| 93 crore towards irrigation projects
and | 49 crore towards roads projects) and has a | 200-225 crore, | 100-
120 crore capex target in FY20E, FY21E, respectively

 Working capital: Working capital days remained steady QoQ at 42 days

 Arbitration: The company received arbitration claim worth | 57.1 crore

(including | 21.8 crore interest) in Q2FY20

 Toll collections: Average toll collections were: a) Walayar BOT: | 18.6

lakh/day; b) Muzaffarpur-Barauni: | 22.6 lakh/day

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 Result Update | KNR Constructions ICICI Direct Research

Company Analysis

Exhibit 4: Order book update

Project Value
Chittor to Mallavaram HAM 874.9
Ramsanpalle to Mangloor HAM 727.9
Trichy to Kallagam HAM 630.5
Hubli-Hospet section of NH-63 307
Flyover at Ramanthapuram and Sungam Junction 191.8
Top 5 Road Projects 2732.1

Other Road Projects 563.5

Irrigation Projects 1850.4
Other Projects 0.8

Total included in order book 5146.8

Not included in order book yet 1535

Total 6681.8
Source: Company, ICICI Direct Research

Exhibit 5: Strong order book position

10000 4.5
4.0
8000
3.5
6000 3.0
(| crore)

2.5
4000

(x)
2.0
2000 1.5
1.0
0
0.5
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20E FY21E
-2000 0.0

Net Order inflows Revenues Closing orderbook Order book-to-bill (x)

Source: Company, ICICI Direct Research

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Exhibit 6: Net working capital days trend

70 50
42 42
60 36 40
50 30
25 26 36 30
40
30
30 20
18 20 20 19
20 14 16 16
12 11 12
10
10
18 20 20 40 58 53
0 0
Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

Inventory Debtors Creditors Net Working Capital

Source: Company, ICICI Direct Research

Exhibit 7: Details of SPA with Cube Highways

Total equity
Cube's stake KNR's stake Conisderation for
Project SPV Name Type investment Price:Equity
(49%) (51%) KNR's 51% stake
(| crore)
Trichy to Kallagam KNR Srirangam Infra Pvt Ltd HAM 96.2 47.2 49.1 73.6 1.5
Chittor to Mallavaram KNR Tirumala Infra Pvt Ltd HAM 143.3 70.2 73.1 152.1 2.1
Ramsanpalle to Mangloor KNR Shankarampet Infra Pvt Ltd HAM 104.2 51.1 53.2 95.8 1.8
Total 343.7 168.4 175.3 321.5 1.8
Source: Company, ICICI Direct Research

Exhibit 8: Revenue to grow at 19.1% CAGR in FY19-21E

3500.0
3000.0
2500.0
(| crore)

2000.0
1500.0
1000.0
1541.1

1931.7

2137.3

2506.6

3031.1

500.0
0.0
FY17 FY18 FY19 FY20E FY21E
Source: Company, ICICI Direct Research

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Exhibit 9: EBITDA & EBITDA margin trend

600.0 25.0
20.0 20.0
500.0 18.3 18.0 20.0
14.9
400.0
15.0
(| crore)

300.0

(%)
10.0
200.0

100.0 5.0
229.6 386.1 427.0 458.7 545.6
0.0 0.0
FY17 FY18 FY19 FY20E FY21E

EBITDA EBITDA Margin (%)

Source: Company, ICICI Direct Research

Exhibit 10: PAT trend in FY19-21E

300.0

250.0

200.0
(| crore)

150.0

100.0

50.0
157.2 272.1 263.3 238.8 266.7
0.0
FY17 FY18 FY19 FY20E FY21E
Source: Company, ICICI Direct Research

Exhibit 11: Return ratios trend

26
23.5
24
22
20 19.0
18.3
18 20.5
(%)

16.2 17.8
16 18.6
17.6
14
14.5
12 14.0
10
FY17 FY18 FY19 FY20E FY21E

RoE RoCE

Source: Company, ICICI Direct Research

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Valuation & Outlook

At the CMP, KNR is trading at attractive valuations of 6.5x FY21E EV/EBITDA
and 13.0x FY21E EPS. The company is a focused road based EPC player that
enjoys a strong execution track record with the reputation of completing
projects on time/ahead of the schedule. KNR also enjoys best in class WC
cycle with very healthy balance sheet and strong return ratio (RoCE: 19.0%
& RoE: 18.6%). Going ahead, with a healthy orderbook, and strong execution
on captive as well as shorter duration irrigation projects, we expect KNR’s
revenues to grow at 19.1% CAGR in FY19-21E. Hence, we maintain our BUY
recommendation on the stock with an SoTP based target price of
| 300/share. We value its core EPC business at | 272/share (7x FY21E
EV/EBITDA, implying 15.7x FY21E fully tax adjusted EPS).

Exhibit 12: SoTP valuation

Value (| crore) Per Share (| ) Comment
EPC Business (A) 3819 272 7.0x FY21E EV/EBITDA

BOT toll Investment (B = C+D) 390 28

Walayar tollway (C) 318 23 0.8x P/BV
Muzaffarpur tollway (D) 72 5 0.8x P/BV
HAM Projects Investment (E) 147 10 0.8x P/BV

Total Equity Investment (F=B+E) 537 38

Less: Net Debt (G) 83 6 FY21E Net Debt

SoTP Value (A+F-G) 4274 304

Rounded-off target price 300
Source: Company, ICICI Direct Research

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Exhibit 13: Recommendation History vs. Consensus

100.0
300
75.0
225
(|)

50.0

(%)
150

75 25.0

0 0.0
Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Feb-18 May-18 Aug-18 Nov-18 Feb-19 May-19 Aug-19 Nov-19

Price Idirect target Consensus Target Mean % Consensus with BUY (RHS)
Source: Bloomberg, Company, ICICI Direct Research

Exhibit 14: Top 10 Shareholders

Rank Name Latest Filing Date % O/S Position (m) Change (m)

1 Kamidi (Narasimha Reddy) 30-Sep-19 32.5% 45.7 0.0

2 Kamidi (Jalandhar Reddy) 30-Sep-19 14.0% 19.6 0.0
3 ICICI Prudential Asset Management Co. Ltd. 31-Oct-19 8.0% 11.2 0.0
4 HDFC Asset Management Co., Ltd. 30-Sep-19 6.4% 9.0 0.0
5 DSP Investment Managers Pvt. Ltd. 30-Sep-19 6.2% 8.8 -0.1
6 Mereddy (Rajesh Reddy) 30-Sep-19 4.4% 6.2 0.0
7 Kamidi (Yashoda) 30-Sep-19 4.3% 6.0 0.0
8 Tata Asset Management Limited 30-Sep-19 3.1% 4.4 2.0
9 L&T Investment Management Limited 30-Sep-19 2.2% 3.0 0.0
Franklin Templeton Asset Management (India)
10 30-Sep-19 2.0% 2.8 0.4
Pvt. Ltd.
Source: Reuters, ICICI Direct Research

Exhibit 15: Recent Activity

Buys Sells

Investor name Value Shares Investor name Value Shares

Tata Asset Management Limited 6.5 2.0 Daiwa Asset Management (Singapore) Ltd. -1.5 -0.4
UTI Asset Management Co. Ltd. 2.7 0.8 BOI AXA Investment Managers Private Limited -0.4 -0.1
Ocean Dial Asset Management Limited 2.6 0.8 DSP Investment Managers Pvt. Ltd. -0.3 -0.1
Axis Asset Management Company Limited 1.5 0.5 Allianz Global Investors Asia Pacific Limited -0.3 -0.1
Franklin Templeton Asset Management (India) Pvt. Ltd. 1.2 0.4 Edelweiss Asset Management Ltd. -0.3 -0.1
Source: Reuters, ICICI Direct Research

Exhibit 16: Shareholding Pattern

(in %) Sep-18 Dec-18 Mar-19 Jun-19 Sep-19

Promoter 55.2 55.2 55.2 55.2 55.2

Public 44.8 44.8 44.8 44.8 44.8
Others 0.0 0.0 0.0 0.0 0.0
Total 100.0 100.0 100.0 100.0 100.0
Source: Company, ICICI Direct Research

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Financial summary

Exhibit 17: Profit and loss statement | crore Exhibit 18: Cash flow statement | crore
(| Crore) FY18 FY19 FY20E FY21E | crore FY18 FY19 FY20E FY21E
Net Sales 1,931.7 2,137.3 2,506.6 3,031.1 Profit before Tax 268.2 290.6 281.0 355.6
Other operating income - - - - Depreciation 134.1 168.1 181.8 197.7
Total Revenues 1,931.7 2,137.3 2,506.6 3,031.1 Interest Paid 23.1 29.1 32.6 33.7
Raw Material Expense 505.5 643.2 744.5 909.3 Cash Flow before WC changes 413.5 453.1 458.7 545.6
Other Construction Expenses 929.8 744.9 914.9 1,106.4 Net Increase in Current Assets (240.8) (168.5) (215.7) (239.1)
Employee benefit expenses 72.1 92.9 112.8 136.4 Net Increase in Current Liabilities 7.8 17.9 101.5 144.1
Other Expenses 38.1 229.3 275.7 333.4 Net CF from Operating Activities 156.8 247.5 302.3 361.7
Total Operating Expenditure 1,545.5 1,710.3 2,047.9 2,485.5 (Purchase)/Sale of Fixed Assets (200.9) (203.4) (200.0) (200.0)
EBITDA 386.1 427.0 458.7 545.6 Purchase of Investment (2.3) (108.3) (44.2) (48.1)
Other Income 39.3 63.4 36.7 41.4 Interest Income (8.5) (4.5) (36.7) (41.4)
Interest 23.1 29.1 32.6 33.7 Net CF from Investing Activities (183.1) (285.4) (207.6) (206.7)
Depreciation 134.1 168.1 181.8 197.7 Proceeds from share capital - - - -
PBT 268.2 290.6 281.0 355.6 Interest Paid 23.1 29.1 32.6 33.7
Total Tax (3.9) 27.3 42.1 88.9 Net CF from Financing Activities 51.2 7.2 (39.8) (41.7)
Reported PAT 272.1 263.3 238.8 266.7 Net Cash flow 24.9 (30.7) 55.0 113.3
Adjusted PAT 272.1 263.3 238.8 266.7 Opening Cash/ Cash Equivalent 16.4 37.1 13.0 68.0
EPS (Diluted) 19.4 18.7 17.0 19.0 Closing Cash/ Cash Equivalent 41.3 6.4 68.0 181.3
Source: Company, ICICI Direct Research Source: Company, ICICI Direct Research

Exhibit 19: Balance sheet | crore Exhibit 20: Key ratios

(| Crore) FY18 FY19 FY20E FY21E (Year-end March) FY18 FY19 FY20E FY21E
Liabilities Per Share Data
Share Capital 28.1 28.1 28.1 28.1 EPS (Fully Diluted) 19.4 18.7 17.0 19.0
Reserves & Surplus 1,129.7 1,386.1 1,617.8 1,876.4 Cash EPS 28.9 30.7 29.9 33.0
Total Shareholders funds 1,157.8 1,414.2 1,645.9 1,904.5 BV 82.3 100.6 117.1 135.5
Secured Loan - 33.6 59.5 59.5 -
Unsecured Loan 240.3 230.6 204.6 204.6 Operating Ratios
Total Debt 240.3 264.1 264.1 264.1 EBITDA / Net Sales 20.0 20.0 18.3 18.0
Deferred Tax Liability - - - - PAT / Net Sales 14.1 12.3 9.5 8.8
Liability side total 1,427 1,696 1,930 2,192 Inventory Days 13 16 20 20
Debtor Days 44 40 45 45
Assets Creditor Days 41 38 38 38
Gross Block 817.6 1,012.4 1,212.4 1,412.4 Return Ratios
Net Block 331.6 371.1 389.3 391.6 RoE 23.5 18.6 14.5 14.0
Capital WIP 0.0 0.0 0.0 0.0 RoCE 20.5 19.0 16.2 17.8
Non-current Investments 572.0 683.0 727.3 775.3 RoIC 32.4 26.5 24.9 28.7
Current Assets Valuation Ratios
Inventories 71.2 95.0 137.3 166.1 EV / EBITDA 9.4 8.7 7.9 6.5
Sundry Debtors 232.0 234.4 309.0 373.7 P/E 12.8 13.2 14.5 13.0
Loans and Advances 27.9 9.1 9.8 10.7 EV / Net Sales 1.9 1.7 1.5 1.2
Other Current Assets 428.4 533.9 626.1 757.1 Market Cap / Sales 1.8 1.6 1.4 1.1
Cash 43.8 13.0 68.0 181.3 Price to Book Value 3.0 2.5 2.1 1.8
Total Current Assets 759.5 872.3 1,082.3 1,307.6 Turnover Ratios
Creditors 218.4 223.6 262.2 317.1 Asset turnover 1.4 1.3 1.3 1.4
Provisions 14.2 11.8 13.8 16.7 Gross Block Turnover 2.4 2.1 2.1 2.1
Other Current Liabilities 314.9 338.4 396.9 480.0 Solvency Ratios
Other Long Term Liabilities 13.2 13.3 15.5 18.8 Debt / Equity 0.2 0.2 0.2 0.1
Total Current Liabilities 547.5 573.8 673.0 813.8 Current Ratio 1.4 1.5 1.6 1.6
Net Current Assets 288.1 331.1 496.9 694.7 Debt / EBITDA 0.6 0.6 0.6 0.5
Assets side total 1,427 1,696 1,930 2,192 Quick Ratio 1.3 1.4 1.4 1.4
Source: Company, ICICI Direct Research Source: Company, ICICI Direct Research

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Exhibit 21: ICICI Direct coverage universe (Roads & Construction)

Sector / Company CMP M Cap EPS (|) P/E (x) EV/EBITDA (x) P/B (x) RoE (%)
(|) TP(|) Rating (| Cr) FY19 FY20E FY21E FY19 FY20E FY21E FY19 FY20E FY21E FY19 FY20E FY21E FY19 FY20E FY21E
KNR Constructions (KNRCON) 247 300 Buy 3,473 18.7 17.0 19.0 13.2 14.5 13.0 8.7 7.9 6.5 2.5 2.1 1.8 19.0 16.2 17.8
PNC Infratech (PNCINF) 190 250 Buy 4,849 11.9 18.2 17.1 15.9 10.4 11.0 10.7 6.6 6.5 2.3 1.9 1.7 14.4 18.4 15.0
Ashoka Buildcon (ASHBUI) 118 150 Buy 3,312 -1.4 -1.7 0.4 NA NA 307.1 6.5 5.9 5.2 NA NA 13.9 NA NA 4.5
NCC (NAGCON) 58 75 Buy 3,484 9.4 6.1 7.1 6.2 9.5 8.1 3.6 4.9 4.6 0.7 0.7 0.6 11.9 7.3 7.9
Source: Company, ICICI Direct Research

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RATING RATIONALE
ICICI Direct endeavors to provide objective opinions and recommendations. ICICI Direct assigns ratings to its
stocks according to their notional target price vs. current market price and then categorizes them as Buy, Hold,
Reduce and Sell. The performance horizon is two years unless specified and the notional target price is defined
as the analysts' valuation for a stock
Buy: >15%
Hold: -5% to 15%;
Reduce: -15% to -5%;
Sell: <-15%

Pankaj Pandey Head – Research pankaj.pandey@icicisecurities.com

ICICI Direct Research Desk,

ICICI Securities Limited,
1st Floor, Akruti Trade Centre,
Road No 7, MIDC,
Andheri (East)
Mumbai – 400 093
research@icicidirect.com

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ANALYST CERTIFICATION
I/We, Deepak Purswani, CFA, MBA (Finance), Harsh Pathak, MBA (Finance), Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect
our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report. It is also confirmed that
above mentioned Analysts of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months and do not serve as an officer, director or employee of the companies
mentioned in the report.

Terms & conditions and other disclosures:

ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stock brokering and distribution of financial products. ICICI Securities Limited is a Sebi registered
Research Analyst with SEBI Registration Number – INH000000990. ICICI Securities Limited Sebi Registration is INZ000183631 for stock broker. ICICI Securities is a subsidiary of ICICI Bank which is India’s largest private sector bank
and has its various subsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, etc. (“associates”), the details in respect of which are available on
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ICICI Securities | Retail Research 12