CEAT

MANAGEMENT SPEAK
Aspires aggressive market share
UNRATED

Takeaways from CEAT analyst meet (refer presentation): a) Management aspires

aggressive market share gains across categories: 18-20% in PCR (13-14% currently);
17 June 2021
~35% in 2Ws (28-30%); 13-14% in TBR (7-8%); b) strengthen focus across i) product
BSE Sensex: 52323 development (multiple platforms), ii) distribution (includes digital footprint), iii) brand
equity (raising OEM presence, sustained brand spends), iv) innovative service models
Sector: Automobiles
(mainly in TBR say pay per use) to drive share gains; c) drive digitization and automation
across verticals to drive productivity, widen SKUs with better quality, lower time-to-
market etc; d) capex plans of ~Rs20bn over FY21-23E (30-70% expansion across
segments) to support market share aspirations; e) triple international business through
Stock data focussed market strategy, with market-specific products; f) signs of replacement
demand pick-up visible in Jun 2021; expect margin recovery during 2H, with lag in price
CMP (Rs) 1,380 hikes, likely peaking of commodity and cost-reduction initiatives (Rs1.5bn over
FY21/22E). CEAT trades at 12.5x FY23E PER (BB estimates). The stock is Unrated.
Mkt Cap (Rs bn/USD m) 55.8 /753
High priority on PCR; distribution and brand are key variables (~14% of revenues): CEAT
Target Price (Rs) NA aspires ~20% share in PCR replacement from 13-14% currently (10-11% in FY20) over
the medium term. Share gains would be driven by a) innovative product/platform launch
Change in TP (%) NA
(such as ‘Secura Drive’ for better grip), through strong R&D capabilities, b) rub-off from
Potential from CMP (%) NA huge rise in OEM presence (limited presence earlier), c) leveraging wide 2W distribution
network, d) improving brand equity through sustained/innovative brand spends/
Earnings change (%) campaigns (IPL association etc), e) entry into premium segment (higher inch tyres).
FY22E NA Consolidate presence in 2Ws from 28-30% to 35% (29% of revenues): Market share
would be driven by a) new products (such as ‘puncture safe’ tubeless tyres), b) deepening
FY23E NA distribution network in rural areas, c) strong focus on digital/e-commerce for superior
purchase experience/after-sales service, d) focus on Honda within OEMs, where it has
Bloomberg code CEAT IN
relatively low presence. CEAT also enjoys strong presence in electric 2W industry (includes
1-yr high/low (Rs) 1,763/835 Ather, Okinawa, etc) with ~50% market share.

6-mth avg. daily volumes (m) 0.4 Double TBR share to 13-14% (~34% of revenues): As T&B forms 50% of industry revenues,
building presence is critical for scale and relevance. Superior product (such as recently
6-mth avg. daily traded value launched X3 mileage product), with innovative service models (such as application-based
selling, pay per use, etc) along with capacity expansion would drive share gains.
(Rsm/USDm) 566.9/7.7
Triple international revenues (~14% of revenues): CEAT has narrowed its focus on a)
Shares outstanding (m) 40.5 Europe for PCR and TBR segments, b) ASEAN for 2Ws, and, c) US and Europe for OTR
Free float (%) 53.2 segment. For the international market, it aims to develop market-specific products and
seed the right market. Off-highway business gained traction with 70% growth in Europe
Promoter holding (%) 46.8 during FY21. Its new product launch (niche-agri tyre based on flex technology to handle
heavy loading) has been well accepted. CEAT doubled reach during FY21, and entered 6
Price performance – relative & absolute new countries; this, with measured expansion, places it well to capture growth potential.
CEAT Sensex
200 Key valuation metrics
150 Year to 31 Mar FY17 FY18 FY19 FY20 FY21
Net sales (Rs m) 57,652 62,308 69,845 67,788 76,096
100
Adj. net profit (Rs m) 3,745 2,720 2,959 2,599 4,664
50 Shares in issue (m) 40 40 40 40 40
0 Adj. EPS (Rs) 92.6 67.2 73.1 64.3 115.3
Jun-18 Mar-19 Dec-19 Sep-20 Jun-21
% change (9.7) (27.4) 8.8 (12.2) 79.4
(%) 3-mth 6-mth 1-yr PE (x) 17.6 24.2 22.3 25.4 14.1
CEAT IN (9.9) 23.3 47.7 Price/ Book (x) 2.7 2.5 2.4 2.2 2.0
BSE Sensex 5.1 11.6 56.2 EV/ EBITDA (x) 11.4 11.7 12.4 11.7 8.1
RoE (%) 16.5 10.7 10.9 9.1 14.9
RoCE (%) 15.3 12.3 10.9 9.0 12.3
Source: Company, DAM Capital Research

Chirag Jain Pravin Yeolekar

chirag@damcapital.in pravin@damcapital.in
+91 22 42022643 +91 22 42022698

For Private Circulation only “Important disclosures appear at the back of this report”
 CEAT

Other highlights
 Signs of replacement demand pick-up visible during Jun 2021; expect TBR (Truck Bus Radial) to witness sharpest
recovery: Demand in Apr-May has been challenging. However, June saw some uptick in replacement demand,
though demand from OEMs remained subdued. The CV segment was buoyant compared to other segments. The
farm segment too tapered off during the 2nd wave. Overall, the company expects good demand recovery over the
next few years, as the last 5 years have borne the impact of various macro events like demonetisation, GST, BSVI
norms, COVID, etc.
 Expects to expand capacities across categories to meet market share aspirations: CEAT has 6 manufacturing
facilities in India; Ambernath (OTR tyres), Nagpur (2W tyres), Chennai (PCR tyres), Mumbai (T&B and farm tyres),
Halol (T&B and PCR tyres) and Nashik (farm and T&B tyres). The company is adding significant capacities to expand
market share and meet demand, in addition to focusing on high level of automation and laying priority on flexibility,
as the number of SKUs are increasing, as per management. Expansion plans include: a) 67% increase in PCR
capacity from 870k tyres per month to ~1,450k tyres per month by FY23, b) 26% higher 2W/3W tyre capacities
from 3.3m tyres per month to 4.16m tyres per month by FY23, c) 56% higher TBR capacity from 100k tyres per
month to 156k tyres per month by FY23, and, d) 36% rise in OTR tyre capacity from 165tonnes/day to 225tonnes/
day by FY23.
 Expects near-term pressure on margins: Management expects 1Q gross margins to be impacted, as raw material
costs have risen 8-10% sequentially. CEAT has already taken price hikes in Apr and May (cumulative of ~4%) and
might take another at the end of June, as per management.
 Developing multiple product/platforms across categories: CEAT has developed a new platform for each of its
segment, such as grip technology for 2Ws (benchmarked with peers; performance is superior), mileage platform for
taxi segment (first one to offer 100k km). It has launched ‘Puncture safe’ tubeless tyres for the 2W segment, ‘Secura
Drive’ superior grip for the premium segment in PCR and ‘Vardhan’ for the farm tyre segment.
 Enjoys strong 50% share in electric 2Ws: The company supplies to all major OEMs and even smaller players in the
e-2W segment, and has garnered 50-100% share of the business; overall segment share is strong at ~50%. e-2W
tyres are priced at par with ICE 2W ones. e-2W tyres need to have lower noise and lower rolling resistance; resistance
to higher wear and tear due to increased load/torque.
 Leveraging 6 enablers/capabilities to drive goals: 1) strong focus on R&D, 2) manufacturing, 3) digital, 4)
distribution, and brand equity, 5) strong financials, 6) people and sustainability.
 R&D strength and capabilities (spends 1.7% of revenues): Four key areas that the company believes it needs to
focus on are a) Compounding: developing new materials to reduce material cost; tie ups with global universities,
alternative material/substitution of material (silica replacing carbon black) and optimising cost b) Industrialisation:
reduce product development time and digitise product life cycle management, c) Testing: rigorous outdoor and
indoor testing (takes 1-1.5 years on road testing); advanced digital system to simulate on road tyre performance (to
increase accuracy) d) Future technology: Develop EV tyres, green tyres, tyres with sensors (would help fleet operators
to gauge the performance of tyres).
 Best-in category digital initiatives: Superior customer experience through online purchasing (available on all
platforms); seamless ordering, doorstep delivery and fitment or pick up at the store (first company in India). CEAT
has the most advanced dealer customer experience portal, and improved customer claim experience on
warranty/replacement (claim resolution reduced from 3-7days to 15 mins) through ‘whatsapp’ chat facility.
 Tyre pricing versus competition: Pricing in the market varies with market share positioning; in 2Ws, CEAT has the
highest net realisation versus peers, while in PCR and TBR, the price gap has narrowed to 1-1.5% versus the market
leader in the segment.
 PCR tyres: There has been mix improvement with shift towards higher rim sizes; mix has improved by almost 5% in
the last few years (from 15-20% approximately).
 Margin differential vs peers: Management indicated that CEAT’s margins were impacted due to 1) higher staff costs,
as more people were added, given the 6-month advancement of the at the Chennai and Halol plant expansions, 2)
higher advertisement spends 3) operating scale disadvantages 4) high-cost older factories. CEAT aspires to partially
reduce the margin gap with peers over the next 2-3 years.
 Capex: The company has guided capex of Rs10bn capex for FY22 and Rs8.0-10bn for FY23.

2 | DAM CAPITAL 17 June 2021

 CEAT

 Sustainability: CEAT is targeting 50% reduction in carbon footprint by 2030, through 1) Manufacturing: Using
briquette as a fuel and 25% of plant electricity generation using solar rooftops, 2) Materials: Increasing the use of
greener raw materials like recycled crumb rubber; Environmental, Social and Governance (ESG)-compliant vendors
3) Product use: By introducing light-weight tyres, low rolling resistance tyres and increasing retreadibility, 4) End of
life: Recycling old tyres, and, 5) Transportation: network optimisation.
 ESG: The auto industry is faced with higher pressure to improve emission norms and fuel efficiency, while for tyre
makers, the challenge is to lower noise and reduce rolling resistance. For tyre makers, more regulations pertain to
end of tyre life, and CEAT is working with the government to correctly dispose tyre at the end of life.

Exhibit 1: Maximum revenues are derived from the T&B Exhibit 2: The replacement segment contributes two-thirds
and 2W segments of total revenues

Revenue mix by segment (%, FY21) Revenue mix by channel (%, FY21)

PCR, 14 Exports, 14

T&B, 34

OEM, 21
2Ws/3Ws,
29
Replaceme
nt, 65
Speciality /
LCVs, 9 Farm, 14
Source: Company, DAM Capital Research Source: Company, DAM Capital Research

Exhibit 3: CEAT was focused on the passenger segment in the last decade, with the share rising from 15% in FY11 to 43% in FY21
Revenue mix by segment (%) FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
T&B 58 53 52 46 42 38 33 32 30 32 34
Speciality / Farm 14 14 13 14 12 10 12 11 13 11 14
LCVs 13 14 14 14 13 13 13 12 11 12 9
2Ws/3Ws 10 12 13 17 23 27 29 31 32 32 29
PCR 5 7 8 9 10 11 13 14 14 14 14
Source: Company, DAM Capital Research

Exhibit 4: The share of replacement segment increased significantly in FY21, driven by a sharp fall in OEM demand
Revenue mix by channel (%) FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Replacement 69 61 57 58 60 64 63 61 58 59 65
OEMs 13 16 20 22 22 23 23 27 27 27 21
Exports 18 22 23 20 18 13 14 12 15 14 14
Source: Company, DAM Capital Research

Exhibit 5: CEAT’s revenues grew at 5%/7% CAGR over the last 5/10 years, respectively
Revenue by segment FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Truck and Bus 19,523 22,772 24,759 24,146 22,780 20,502 18,595 18,133 18,097 18,654 23,393
Speciality / Farm 4,712 6,089 6,038 7,246 6,338 5,416 6,518 6,233 7,842 6,514 9,632
LCV 4,376 6,015 6,666 7,349 7,051 7,014 7,325 6,800 6,635 6,810 6,192
Two Wheeler 3,366 5,250 6,390 8,990 12,460 14,830 16,480 17,567 19,303 18,951 19,953
Passenger Cars /UVs 1,683 2,840 3,760 4,760 5,610 6,190 7,430 7,933 8,445 8,291 9,632
Standalone revenue 33,661 42,966 47,613 52,491 54,239 53,952 56,348 56,667 60,322 59,221 68,803
Growth yoy (%) 27.6 10.8 10.2 3.3 (0.5) 4.4 0.6 6.5 (1.8) 16.2
Source: Company, DAM Capital Research

3 | DAM CAPITAL 17 June 2021

 CEAT

Exhibit 6: CEAT’s gross margin rose significantly vs peers, Exhibit 7: Despite leading gross margin, EBITDA margin
given the improvement in mix of 2W/PCR lagged vs peers, due to lower scale, higher ad spends
Gross margin (%) EBITDA margin (%)
CEAT APTY MRF CEAT APTY MRF
50 43 43 44 44 25.0 22.0
40 42
40 20.0 17.9 18.2
33 16.4
29
30 26 15.0 13.5 12.9
11.1
9.6
20 10.0
4.5
10 5.0

0 0.0
FY11 FY16 FY21 FY11 FY16 FY21
Source: Company, DAM Capital Research Source: Company, DAM Capital Research

Exhibit 8: CEAT has higher employee expenses Exhibit 9: Other expenses too have risen significantly over
the years
Employee expenses (% of sales)
Other expenses (% of sales)
CEAT APTY MRF
10.0 CEAT APTY MRF
8.9 8.7 30.0
7.9
8.0 7.1 22.6 22.1
6.5 6.3
5.9 5.6 18.6
6.0 5.0 20.0 16.6 15.915.1
15.9 15.4
14.3
4.0
10.0
2.0

0.0
0.0
FY11 FY16 FY21
FY11 FY16 FY21
Source: Company, DAM Capital Research Source: Company, DAM Capital Research

Exhibit 10: CEAT’s spends on advertisement and sales promotion is higher (as % of sales) versus peers
Adv. and sales promotion FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20
CEAT 449 424 743 754 1,042 1,185 1,221 1,467 1,689 1,610
APTY 988 366 696 766 565 1,125 1,086 1,422 1,956 2,514
MRF 852 1,025 1,153 1,382 1,489 3,572 2,568 2,598 3,040 3,004
Adv. and sales promotion (% of sales)
CEAT 1.2 0.9 1.5 1.4 1.8 2.2 2.1 2.4 2.4 2.4
APTY 1.8 0.4 0.8 0.9 0.6 1.3 1.2 1.4 1.6 2.3
MRF 1.1 1.1 1.0 1.1 1.1 1.8 1.9 1.8 1.9 1.9
Source: Company, DAM Capital Research

Exhibit 11: CEAT’s R&D spends also increased sharply over the decade
R&D expenditure FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20
CEAT 57 426 177 187 216 522 1,332 1,008 908 1,143
APTY 321 374 407 944 1,043 1,713 1,749 1,560 2,194 1,954
MRF 176 219 318 316 341 549 1,997 1,590 1,113 1,064
R&D expenditure (% of sales) - - - - - - - - - -
CEAT 0.2 0.9 0.3 0.3 0.4 0.9 2.1 1.6 1.3 1.7
APTY 0.6 0.5 0.5 1.1 1.2 2.0 2.0 1.5 1.8 1.8
MRF 0.2 0.2 0.3 0.3 0.3 0.3 1.5 1.1 0.7 0.7
Source: Company, DAM Capital Research

4 | DAM CAPITAL 17 June 2021

 CEAT

Exhibit 12: CEAT has aggressive expansion plans to expand market share

Source: Company, DAM Capital Research

Exhibit 13: CEAT capex spend stood at Rs27bn over the last 3 years
Capex (Rs m) % of sales (RHS)
14,000 18.5 20.0

10,500 12.4 15.0

11.9
9.5
8.6
7,000 10.0
6.8

3,500 5.0

0 0.0
FY16 FY17 FY18 FY19 FY20 FY21
Source: Company, DAM Capital Research

Exhibit 14: CEAT turned FCF positive in FY21, driven by Exhibit 15: …resulting in lower net debt; D/E is under
improved profitability and working capital… control

FCF (Rs m) Net debt (Rs m) Net D/E (x, RHS)

8,000 6,861 20,000 0.80

6,003
4,280
4,000 15,000 0.60

0 10,000 0.40
(117)
-4,000 (2,195) 5,000 0.20

-8,000 (7,186) 0 0.00

FY16 FY17 FY18 FY19 FY20 FY21 FY16 FY17 FY18 FY19 FY20 FY21
Source: Company, DAM Capital Research Source: Company, DAM Capital Research

5 | DAM CAPITAL 17 June 2021

 CEAT

Exhibit 16: RoCE profile of tyre makers Exhibit 17: RoE profile of tyre makers

ROCE (%) ROE (%)

FY11 FY16 FY21 CEAT APTY MRF
45 45

30 30

15 15

0 0
CEAT APTY MRF FY11 FY16 FY21
Source: Company, DAM Capital Research Source: Company, DAM Capital Research

Exhibit 18: CEAT’s financials

CEAT (Rs m) FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Consol. Revenues 36,311 46,527 50,522 55,540 57,521 54,472 57,652 62,308 69,845 67,788 76,096
Growth yoy (%) 27.9 10.3 10.4 4.1 (3.7) 5.4 (0.6) 9.1 (2.9) 12.3
EBITDA 1,650 2,737 4,380 6,579 6,804 7,368 6,555 6,148 6,425 7,238 9,830
EBITDA margin (%) 4.5 5.9 8.7 11.8 11.8 13.5 11.4 9.9 9.2 10.7 12.9
PAT 274 182 1,202 2,708 3,139 3,653 3,309 2,103 2,309 2,128 3,960
EPS (Rs) 7.8 5.3 35.1 75.4 78.4 99.7 89.3 58.8 62.1 56.9 106.9
Capex 6,316 2,457 658 777 1,103 6,468 4,973 4,253 6,630 12,568 9,433
% of sales 17.4 5.3 1.3 1.4 1.9 11.9 8.6 6.8 9.5 18.5 12.4
Net debt 9,625 12,716 9,256 10,059 6,514 6,074 8,745 5,605 13,734 18,430 13,744
Net D/E 1.47 1.88 1.18 0.98 0.39 0.30 0.36 0.22 0.50 0.63 0.41
FCF (2,511) (1,350) 4,998 523 4,488 (117) 6,003 4,280 (7,186) (2,195) 6,861
ROCE (%) 8.3 10.6 17.7 25.7 22.5 21.7 15.3 12.3 10.9 9.0 12.3
ROE (%) 5.3 3.2 20.2 30.4 23.3 21.8 16.5 10.7 10.9 9.1 14.9
Source: Company, DAM Capital Research

Exhibit 19: Tyre sector valuation comparison

P/E (x) ROE (%) Div yield
Company Price Mkt cap P/BV (x) EV/EBITDA (x)
(%)
(Rs) (US$ m) FY22E FY23E FY22E FY23E FY22E FY23E FY22E FY23E FY22E
Balkrishna Industries 2,304 6,006 28.8 24.1 6.1 5.2 18.4 15.2 22.9 23.2 1.0
Apollo Tyres (NR)* 230 1,969 17.1 12.5 1.2 1.1 6.8 5.5 7.2 9.0 1.5
CEAT Ltd (NR)* 1,380 753 15.3 12.6 1.6 1.4 7.8 6.6 10.3 11.6 1.1
MRF Ltd (NR)* 82,676 4,728 24.9 20.6 2.4 2.2 11.2 9.3 9.5 10.4 0.1
Average 25.0 20.5 3.8 3.3 13.6 11.2 15.2 16.0 0.8
Source: Company, DAM Capital Research NR- Not Rated * BB consensus

6 | DAM CAPITAL 17 June 2021

 CEAT
Income statement Key ratios
Year to 31 Mar (Rs m) FY17 FY18 FY19 FY20 FY21 Year to 31 Mar FY17 FY18 FY19 FY20 FY21
Net sales 57,652 62,308 69,845 67,788 76,096 EBITDA margin (%) 11.4 9.9 9.2 10.7 12.9
% growth 5.8 8.1 12.1 (2.9) 12.3 EBIT margin (%) 8.9 7.2 6.4 6.6 8.5
Operating expenses 51,097 56,160 63,420 60,550 66,266 PAT margin (%) 6.5 4.4 4.2 3.8 6.1
EBITDA 6,555 6,148 6,425 7,238 9,830 RoE (%) 16.5 10.7 10.9 9.1 14.9
% change (11.0) (6.2) 4.5 12.7 35.8 RoCE (%) 15.3 12.3 10.9 9.0 12.3
Other income 199 295 390 205 138 Gearing (x) 0.4 0.2 0.5 0.6 0.4
Net interest cost 817 974 880 1,509 1,755 Net debt/ EBITDA (x) 1.3 0.9 2.1 2.5 1.4
Depreciation 1,431 1,686 1,927 2,765 3,396 FCF yield (%) (3.5) 6.2 (10.7) (4.2) 10.2
Pre-tax profit 4,506 3,783 4,008 3,169 4,816 Dividend yield (%) 0.0 0.7 0.8 0.9 1.1
Deferred tax 0 0 311 (51) 98
Current tax 1,064 1,340 940 793 418 Valuations
Profit after tax 3,442 2,443 2,757 2,427 4,301
Year to 31 Mar FY17 FY18 FY19 FY20 FY21
Preference dividend 0 0 0 0 0
Reported EPS (Rs) 89.3 58.8 62.1 56.9 106.9
Minorities 303 277 202 172 363
Adj. EPS (Rs) 92.6 67.2 73.1 64.3 115.3
Adjusted net profit 3,745 2,720 2,959 2,599 4,664
PE (x) 17.6 24.2 22.3 25.4 14.1
Non-recurring items (133) (340) (448) (298) (341)
Price/ Book (x) 2.7 2.5 2.4 2.2 2.0
Reported net profit 3,612 2,380 2,511 2,301 4,323
EV/ Net sales (x) 1.3 1.2 1.1 1.2 1.1
% change (10.5) (34.1) 5.5 (8.4) 87.9
EV/ EBITDA (x) 11.4 11.7 12.4 11.7 8.1
EV/ CE (x) 2.0 2.0 1.7 1.6 1.5
Balance sheet
As on 31 Mar (Rs m) FY17 FY18 FY19 FY20 FY21
Paid-up capital 405 405 405 405 405 Shareholding pattern
Preference capital 0 0 0 0 0
Reserves & surplus 23,745 25,656 27,257 28,675 32,758
Shareholders' equity 24,441 26,295 27,899 29,316 33,395
Total current liabilities 13,039 15,652 17,621 20,864 29,404
Total debt 9,104 6,467 14,469 18,772 14,176
Deferred tax liabilities 2,134 2,203 2,671 2,942 2,869
Other non-current
1,136 848 1,389 1,635 1,541
liabilities
Total liabilities 25,413 25,170 36,150 44,214 47,990
Total equity &
49,854 51,464 64,049 73,529 81,385
liabilities
Net fixed assets 27,788 30,192 40,124 52,283 55,563
Investments 2,316 2,135 1,814 1,837 2,101
Cash 359 863 735 342 431
Other current assets 19,391 18,275 21,375 19,067 23,290
Deferred tax assets 0 0 0 0 0
Other non-current
0 0 0 0 0
assets
Net working capital 6,711 3,485 4,490 (1,455) (5,683)
Total assets 49,854 51,464 64,049 73,529 81,385
As of Mar-21
Cash flow
Year to 31 Mar (Rs m) FY17 FY18 FY19 FY20 FY21
Pre-tax profit 4,506 3,783 4,008 3,169 4,816
Depreciation 1,431 1,686 1,927 2,765 3,396
Chg in Working capital (2,050) 3,729 (1,132) 5,551 4,317
Total tax paid (1,064) (1,340) (940) (793) (418)
Net Interest 817 974 880 1,509 1,755
Others (133) (340) (448) (298) (341)
Operating cash flow 3,529 8,203 4,838 12,149 13,432
Capital expenditure (5,836) (4,090) (11,860) (14,924) (6,676)
Free cash flow (a+b) (2,307) 4,113 (7,022) (2,775) 6,756
Chg in investments (361) 181 321 (22) (264)
Debt raised/(repaid) 2,400 (2,637) 8,002 4,303 (4,597)
Net interest (817) (974) (880) (1,509) (1,755)
Capital
0 0 0 0 0
raised/(repaid)
Dividend (incl. tax) 0 (465) (540) (600) (728)
Other items (9) (244) 0 0 0
Net chg in cash (271) 504 (128) (433) (229)

7 | DAM CAPITAL 17 June 2021

 CEAT

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This document has been prepared by DAM Capital Advisors Limited (Formerly IDFC Securities Limited) [the company/DAM Capital]. DAM Capital is a full-
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iv. The investment discussed or views expressed in the document may not be suitable for all investors. Investors should make their own investigations as
they deem necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including the
merits and risks involved) and investment decisions based upon their own financial objectives and financial resources.
v. The intent of this document is not recommendatory in nature.
vi. DAM Capital has not independently verified all the information given in this document. Accordingly, no representation or warranty, express or implied,
is made as to the accuracy, completeness or fairness of the information and opinions contained in this document.
vii. The Research Analyst and DAM Capital have not been engaged in market making activity for the company (ies) covered in the Research report.
viii. The information contained herein is from publicly available data or made by thorough analysis done by DAM Capital team. The views expressed are
those of analyst and the Company may or may not subscribe to all the views expressed therein.
ix. While DAM Capital would endeavour to update the information herein on reasonable basis, the opinions and information in this report are subject to
change without prior notice and prior approval and DAM Capital, its subsidiaries and associated companies, their directors and employees (“DAM
Capital and associates”) are under no obligation to update or keep the information current.
x. Subject to the disclosures made herein above, DAM Capital, its affiliates, their directors and the employees may from time to time, effect or have
effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to
perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of
these entities functions as a separate, distinct entity, independent of each other. The recipient shall take this into account before interpreting the
document.
xi. This material is being produced by DAM Capital solely for information purposes and for the use of the recipient. It is not to be reproduced, redistributed
or passed on directly or indirectly to any other person or published copied in whole or part for any purpose and the same shall be void where prohibited.
xii. Neither the whole nor part of this document or copy thereof may be taken or transmitted into the United States of America “U.S. Persons” (except to
major US institutional investors (“MII”)) and Canada or distributed or redistributed, directly or indirectly, in the United States of America (except to MII),
Canada, Japan and China or to any resident thereof.
xiii. Where the report is distributed within the United States ("U.S.") it is being distributed pursuant to exemption under Rule 15a-6(a) (2), only to Major U.S.
Institutional Investors. The distribution of this document in other jurisdictions may be restricted by law, and persons into whose possession this
document may come shall inform themselves about, and observe, any such restrictions.
xiv. In no circumstances DAM Capital, any of its directors, employees or any of its associates or any third party involved in, or related to, computing or
compiling the information have any liability for any damages of any kind including but not limited to any direct or consequential loss or damage, however
arising, from the use of this document.

Copyright of this document vests exclusively with DAM Capital Advisors Limited (Formerly IDFC Securities Limited)
Contd…

8 | DAM CAPITAL 17 June 2021

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Disclaimer
Foreign currency-denominated securities are subject to fluctuations in exchange rates that could have an adverse effect on the value or the price of, or income derived
from, the investment. In addition, investors in securities, the values of which are influenced by foreign currencies effectively assume currency risk.
Associates of DAM Capital may have issued other reports that are inconsistent with and reach different conclusions from, the information presented in this report.

This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or
other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject DAM Capital and its
associates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all
jurisdictions or to a certain category of investors. Persons in whose possession this document may come are required to inform themselves of, and to observe,
such applicable restrictions.

Reports based on technical analysis centres on studying charts of a stock's price movement and trading volume, as opposed to focusing on a company's
fundamentals and, as such, may not match with a report on a company's fundamentals.
Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. DAM Capital will not treat recipients as
customers by virtue of their receiving this report.
The analyst certifies that all of the views expressed in this research report accurately reflect his/her personal views about any and all of the subject issuer(s) or
securities. The analyst certifies that no part of his / her compensation was, is, or will be directly or indirectly related to the specific recommendation(s) and/or
views expressed in this report.

Research Disclaimer - Notice to US Investors

This report was prepared, approved, published and distributed by DAM Capital Advisors Limited (Formerly IDFC Securities Limited), a company located outside
of the United States (a “non-US Company”).This report is distributed in the US by DAM Capital (Parent of DAM Capital (USA) Inc.) [Formerly IDFC Capital (USA)
Inc.] only to major U.S institutional investors (as defined in Rule 15a-6 under the U.S Securities Exchange Act of 1934 (the “Exchange Act”)) pursuant to the
exemption 15a-(2) of the Rule and any transaction effected by a U.S customer in the securities described in this report must be effected through DAM Capital
USA as defined in the Rule.
Neither the report nor any analyst who prepared or approved the report is subject to U.S legal requirements or Financial Industry Regulatory Authority, Inc.
(“FINRA”) or other regulatory requirements pertaining to research reports or research analysts. The non-US Company is neither registered as a broker-dealer
under the Exchange Act, nor is a member of FINRA, Inc. or any other U.S. self-regulatory organization. The non-US Company is the employer of the research
analyst(s) responsible for this research report. The research analysts preparing this report are residents outside the United States and are not associated
persons of any US regulated broker-dealer and therefore the analyst(s) is/are not subject to supervision by a US broker-dealer, and are not required to satisfy
the regulatory licensing requirements of FINRA or required to otherwise comply with US rules or regulations regarding, among other things, communications with
a subject company, public appearances and trading securities held by a research analyst account.
It is distributed in the United States of America by DAM Capital under 15a-6(a)(2) and elsewhere in the world by DAM Capital or any authorised associate of DAM
Capital.

ANALYST DISCLOSURES
1. The analyst(s) declares that neither he/she or his/her relatives have a Beneficial or Actual ownership of > 1% of equity of Subject Company/ companies;
2. The analyst(s) declares that he/she has no material conflict of interest with the Subject Company/ companies of this report;
3. The research analyst (or analysts) certifies that the views expressed in the research report accurately reflect such research analyst's personal views about
the subject securities and issuers; and
4. The research analyst (or analysts) certifies that no part of his or her compensation was, is, or will be directly or indirectly related to the specific
recommendations or views contained in the research report.
Explanation of Ratings:
1. Outperformer : More than 5% to Index
2. Neutral : Within 0-5% (upside or downside) to Index
3. Underperformer : Less than 5% to Index

Copyright in this document vests exclusively with DAM Capital Advisors Limited (Formerly IDFC Securities Limited).

SEBI Registration Nos. of DAM Capital Advisors Limited (Formerly IDFC

Securities Limited)
Research Analyst INH 000000 131
Stock Broker
NSE Capital Markets
NSE Futures & Options
INZ000207137
BSE Capital Markets
BSE Futures & Options
Merchant Banker INM000011336

9 | DAM CAPITAL 17 June 2021

 CEAT
www.damcapital.in

Research Analyst Sector/Industry/Coverage E-mail Tel.+91-22-4202 2500

Nitin Agarwal HoR: Pharmaceuticals, Agri-inputs, Midcaps nitin.a@damcapital.in 91-22-4202 2568
Aasim Bharde, CFA Media, Midcaps, Home Improvement, Paints aasim@damcapital.in 91-22-4202 2576
Anuja Dighe Financials anuja@damcapital.in 91-22-4202 2599
Bhoomika Nair Engineering, Cement, Power Equipment, Logistics bhoomika@damcapital.in 91-22-4202 2561
Chirag Jain Automobiles, Auto ancillaries chirag@damcapital.in 91-22-4202 2643
Jay Savla Economy jay.s@damcapital.in 91-22-4202 2660
Kruti Shah Economy kruti@damcapital.in 91-22-4202 2629
Meet Vora Construction, Power, Infrastructure Developers meet@damcapital.in 91-22-4202 2567
Miloni Bagadia Agri-inputs, Midcaps miloni@damcapital.in 91-22-4202 2663
Mohit Kumar, CFA Construction, Power, Infrastructure Developers mohit.k@damcapital.in 91-22-4202 2573
Nandan Chakraborty Strategy nandan@damcapital.in 91-22-4202 2501
Parth Dalia Pharmaceuticals, Midcaps parth@damcapital.in 91-22-4202 2658
Pravin Yeolekar Automobiles, Auto ancillaries pravin@damcapital.in 91-22-4202 2698
Romil Mehta Engineering, Cement, Power Equipment, Logistics romil@damcapital.in 91-22-4202 2649
Vishal Chandak Metals, Mining vishal.c@damcapital.in 91-22-4202 2500
Pankaj Kadu Database Analyst pankaj@damcapital.in 91-22-4202 2562

Equity Sales E-mail Tel.+91-22-4202 2500

Chandan Asrani chandan@damcapital.in 91-22-4202 2540
Himanshu Negandhi himanshu@damcapital.in 91-22-4202 2614
Vishal Mehta vishal.m@damcapital.in 91-22-4202 2507

Equity Sales Dealing E-mail Tel.+91-22-4202 2500

Jayesh Chheda Head – Sales Trading jayesh@damcapital.in 91-22-4202 2595
Rajashekhar Hiremath rajashekhar@damcapital.in 91-22-4202 2516
Suryakant Bhatt bhatt@damcapital.in 91-22-4202 2693

Derivatives Sales Dealing E-mail Tel.+91-22-4202 2500

Abhijeet Mittal abhijeet@damcapital.in 91-22-4202 2536
Chandani Modi chandani@damcapital.in 91-22-4202 2691

Corporate Access E-mail Tel.+91-22-4202 2500

Sarita Shetty Head – Corporate Access sarita@damcapital.in 91-22-4202 2531
Anifa Fernandes anifa@damcapital.in 91-22-4202 2590

DAM Capital Advisors Limited DAM Capital (USA) Inc.

(Formerly IDFC Securities Limited) [Formerly IDFC Capital (USA) Inc.]
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Bandra Kurla Complex, Bandra (East), 600 Third Avenue,
Mumbai 400 051. 2nd Floor,
INDIA New York, 10016

Board: +91 22 4202 2500 Tel: +1 646 571 2303

Fax: +91 22 4202 2504 Fax: +1 646 571 2301

Our research is also available on Bloomberg and Thomson Reuters

10 | DAM CAPITAL
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