Essence of The Week: What Goes Down Must Come Up?

ESSENCE OF THE WEEK
What goes down must come up?
November 12, 2021 India Weekly

Sensex: 60687| Nifty: 18103 The SENSEX rose 1.3% WoW but not without significant volatility during the week.
Both the BSE midcap index and the BSE small cap index rose by about 1% WoW but
Index FY21 FY22E FY23E with similar volatility during the week. Even FII flows was equally volatile with
Sensex EPS 1,691 2,335 2,747 sentiment improving towards the end of the week. In sum net FIIs flows was
EPS gwth % 38.1 17.7 broadly neutral during the week. Indian equities market got whipsawed by US
PE (x) 36 26 22 inflation data which came it at multi-decade high of 6.2% YoY in October which
Nifty EPS 526 737 869 raised prospects of more aggressive action by the US Fed. However, markets seem
EPS gwth % 40.0 17.9 to have shifted focus to strong earnings reported in the US and Europe.
PE (x) 34 25 21
Source: Bloomberg
15 FII Equity FII Debt

WHAT's IN IT FOR YOU? (USD bn)
 Earnings & valuations ...................................... 2 10
 EPS & target price changes ........................... 3
5
 Earnings Review Q2FY22.............................. 4
0
Summaries of reports and event updates
(5)
Macro
 Eco: October CPI up on food & fuel; (10)
September IIP output flat ........................... 10
(15)
 Macro Matters – India states fiscal:
Spotlight on sales tax collection ............... 10 (20)
Sep 19
Sep 20
Sep 21
May 19
May 20
May 21
Nov 18
Nov 19
Nov 20
Nov 21
Mar 19
Mar 20
Mar 21
Jan 19
Jan 20
Jan 21
Jul 19
Jul 20
Jul 21
 Eco: High Frequency Indicators in
October.............................................................. 11
Sector
Source: CEIC, Axis Capital, Note October data as of 12th
 Auto ..................................................................... 13
 Pharma ............................................................... 13
Corporate
 Navin Fluorine International ..................... 12
Market snapshot: Debt & Money mkt, Equity

valns & perf/ Derivatives ............................ 17-26
Valuation guide .............................................. 27-32
Appendix
Results Schedule – Q2FY22 .............................. 33
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FOR IMPORTANT DISCLOSURES AND DISCLAIMERS, REFER TO THE END OF THIS MATERIAL
Essence of the week
Weekly Note
EARNINGS & VALUATIONS
Key indices: Forward P/E
Nifty NSE Midcap 100

50
Fwd PE range - Mar'06 to date
40
Nifty * NSE Midcap 100
30
Current 22 24
20 Top Quartile 21 24
10 Median 18 17
0 Low Quartile 15 13
Nov-05
Nov-06
Nov-07
Nov-08
Nov-09
Nov-10
Nov-11
Nov-12
Nov-13
Nov-14
Nov-15
Nov-16
Nov-17
Nov-18
Nov-19
Nov-20
Nov-21
Source: Axis Capital, Bloomberg Note: * based on Axis Capital estimates. Midcap estimates are from Bloomberg
Axiscap universe: Sector earnings and valuations

Number Earnings gwth (%) PER (x) # ROE (%) 12m fwd valns since FY11 (x) #
Sector of Cos FY22E FY23E FY22E FY23E FY22E FY23E Min Current  Max
Autos 19 41 136 36 23 10 18 9 45
NBFC 12 37 24 6 5 15 16 2 4
Chemicals 9 (5) 33 47 35 21 22 5 37
Engg 5 38 32 42 36 13 14 13 60
FMCG 14 10 23 65 52 33 37 23 49
Infra 1 36 36 26 19 17 19 10 28
Logistics 3 58 39 41 30 11 16 12 45
Media 4 2 52 18 22 (3) 19 14 41
Pharma 18 63 22 37 30 16 17 13 35
Power 7 14 18 4 3 15 16 1 2
Retail 9 75 128 166 96 19 25 19 201
Nifty 50 40 18 25 21 15 15 12 23
Note : 1) Sector aggregate based on mcap weighted methodology 2 ) # for BFSI, Power, Realty PE = PB, while for Cement, Metals & Telecom PE = EV/E
Source: Axis Capital
Definition of quartile: One of the three numbers (values) that divide a range of data into four equal parts. The first quartile (also called 'lower quartile') is the number below
which lies the 25% of the bottom data. The second quartile (the 'median') divides the range in the middle and has 50% of the data below it. The third quartile (also called 'upper
quartile') has 75% of the data below it and the top 25% of the data above it.
November 12, 2021 2

Essence of the week
Weekly Note
EPS & TARGET PRICE CHANGES
Shaded cells highlight changes in TP/ EPS made during the week
Mcap CMP Curr Target Price (Rs) EPS FY22E (Rs) EPS FY23E (Rs)
(USD mn) (Rs) Rating Prev Curr % Chg Prev Curr % Chg Prev Curr % Chg
Auto
Eicher Motors 9,999 2,722 Sell 2,050 2,200 7 75 66 (12) 101 102 1
Mah & Mah 15,653 937 Buy 1,200 1,230 2 39 41 5 50 51 2
Minda Industries 3,591 936 Add 740 970 31 15 12 (20) 25 25 (2)
MRF 4,455 78,194 Sell 70,000 70,000 - 2,942 2,406 (18) 3,764 3,557 (5)
BFSI
Piramal Enterprises 8,506 2,653 Add 3,100 3,050 (2) 114 103 (10) 132 129 (2)
FMCG
Britannia Inds 11,928 3,687 Reduce 3,650 3,700 1 71 67 (6) 81 77 (5)
Pidilite Ind 16,557 2,426 Reduce 2,000 2,250 13 26 26 1 34 35 3
Pharmaceuticals
Alembic Pharma 2,061 781 Add 960 900 (6) 38 37 (3) 46 44 (5)
Aurobindo Pharma 5,415 688 Buy 850 800 (6) 52 50 (4) 59 58 (2)
Divi's Lab 17,269 4,843 Reduce 5,200 5,000 (4) 93 91 (3) 117 108 (8)
Retail
ABFRL 3,757 298 Add 240 310 29 (1) (1) - 4 5 19
Bata India 3,720 2,155 Add 1,800 2,200 22 10 11 14 39 42 8
Kalyan Jewellers 1,079 78 Buy 95 105 11 2 2 5 4 4 3
Page Industries 6,059 40,440 Add 35,000 42,500 21 452 471 4 599 641 7
Source: Axis Capital, Bloomberg
November 12, 2021 3

Essence of the week
Weekly Note
AXIS CAPITAL: EARNINGS REVIEW Q2FY22

Note: For Banking: we have taken Net Income as Revenue, Operating profit as EBITDA, LP = Loss to Profit, PL = Profit to Loss
Q'Sep'21
Company Actual YoY (%) Comment
ABFRL Results expectations : Above

Revenue growth at ~96% YoY, beat led by better-than-expected recovery; operating profit largely in
Revenues (Rs mn) 19,960 96 EPS up/dngrade : ▲
line despite aggressive store expansion. Further acceleration in store opening targets across segments
EBITDA (Rs mn) 3,147 159 PE up/dngrade : ▲
(450+ stores in Madura, 100+ in Pantaloons/ethnic each). Net debt at Rs 8.3 bn.
Adj PAT (Rs mn) 141 LP TP up/dngrade : ◄►
Alembic Pharma Results expectations : Above EBITDA (-42% YoY) was 6%/ 3% above our/ consensus estimate on better than expected gross margin
Revenues (Rs mn) 12,923 (11) EPS up/dngrade : ▼ (+328 bps QoQ) and cost controls despite weak US sales. Expects to outperform IPM growth and
EBITDA (Rs mn) 2,572 (42) PE up/dngrade : ▼ grow US business on Q2 base; issued Form 483 (10 observations) on re-inspection of F-3,
Adj PAT (Rs mn) 1,693 (49) TP up/dngrade : ▼ commercialization delayed. Cut FY22/FY23E EPS by 3%/5% and TP to Rs 900 (from Rs 960) on delay
in plant clearance. Maintain ADD as significant investments in US business awaits monetization.
Anupam Rasayan Results expectations : Above Gross margin expanded 140 bps QoQ to 64% (low base YoY) aided by low-cost inventory build-up; to
Revenues (Rs mn) 2,489 13 EPS up/dngrade : ◄► normalize to 58-60% going ahead. Inventory surged in H1 to ensure adequate RM availability; to
EBITDA (Rs mn) 640 28 PE up/dngrade : ◄► reduce in H2 as client contracts gets renegotiated to 6-month pricing (vs 12-month now). Expect 38%
Adj PAT (Rs mn) 361 11 TP up/dngrade : ◄► EBITDA CAGR over FY21-24, as it ramps up utilization (Rs 8 bn capex over FY18-21). ADD stays with
TP of Rs 920 (30x Sept’23E).
Aurobindo Pharma Results expectations : Below EBITDA (-17% YoY) was 5%/ 10% below our/ consensus estimate on weak sales in ARV/ RoW and
Revenues (Rs mn) 59,419 (8) EPS up/dngrade : ▼ lower gross margin (-337 bps YoY) despite cost controls. It remains cautious on US due to lower price/
EBITDA (Rs mn) 11,867 (17) PE up/dngrade : ▼ demand in near term; focus on value unlocking in injectables; expects recovery in ARV, normalized
Adj PAT (Rs mn) 6,956 (13) TP up/dngrade : ▼ gross margin by Q4FY22. Cut EPS and TP to Rs 800 (from Rs 850) on near term headwinds. Maintain
BUY as strong R&D pipeline (Biosimilar, complex injectables) to play out from H2’23/ FY24.
Bandhan Bank Results expectations : Below Q2 loss at Rs 30.1 bn on kitchen sinking exercise – provided for accelerated provisioning of Rs 36 bn
Revenues (Rs mn) 24,270 5 ABV up/dngrade : ▼ in addition to business as usual provisions on stress book. Stress remains elevated with GNPA at 10.8%
EBITDA (Rs mn) 15,492 (5) PB up/dngrade : ▼ and restructured book at 11.2% of book. Loan growth meagre at 6.6% YoY. NIM declined on interest
Adj PAT (Rs mn) (30,086) PL TP up/dngrade : ▼ reversal.
Bata India Results expectations : Above
Revenues (Rs mn) 6,141 67 EPS up/dngrade : ▲ Better-than-expected revenue recovery (85% of pre-Covid; vs. 75-80% estimated) led to beat; GM
EBITDA (Rs mn) 1,191 556 PE up/dngrade : ▲ miss (~210 bps below est) offset by cost savings.
Adj PAT (Rs mn) 370 LP TP up/dngrade : ▲
Continued…
November 12, 2021 4

Essence of the week
Weekly Note
Q'Sep'21
Bharat Electronics Results expectations : Above BEL reported sales at Rs 36.6 bn (+15% YoY) was 2%-5% ahead of our and consensus estimates. H1
Revenues (Rs mn) 34,756 9 EPS up/dngrade : ◄► sales is +9% YoY. Even though Q2 gross margin at 44% was 100 bps below estimate, other operating
EBITDA (Rs mn) 6,951 11 PE up/dngrade : ▲ expenses fell 400 bps YoY driving an EBITDA beat of ~20% vs. consensus estimate. PAT at Rs 6.1 bn
Adj PAT (Rs mn) 4,760 20 TP up/dngrade : ▲ (+54% YoY) was 27%-29% ahead of our and consensus estimates. For H2, our estimates imply revenue
of Rs 92 bn (+21% YoY), EBITDA margin of 24.1% and net profit of Rs 16.1 bn (+15% YoY). Revise TP
to Rs 242 (17% upside), implying 19x FY24E P/E (post 2009 1-year forward mean 15x, +1 s.d. ~20x).
FY21-24 EPS CAGR of 14%, RoE ~22%. Retain BUY.
BHEL Results expectations : Above Q2 revenue of Rs 51 bn is still 18% below pre-Covid Q2FY20 levels. Gross margin of 33.9% (-160 bps
Revenues (Rs mn) 51,122 38 EPS up/dngrade : ◄► YoY) was below our estimate of 36.0%. Management attributed gross margin pressure to import
EBITDA (Rs mn) (292) NA PE up/dngrade : NA restrictions from China, high civil work component in revenue and commodity cost pressures.
Adj PAT (Rs mn) (675) NA TP up/dngrade : ◄► However, EBITDA margin of -0.6% was better than our estimate of -4.4%, mainly led by a net-reversal
of Rs 1.8 bn in provisions (part of other expenses which were -34% YoY). Maintain SELL. Thermal
capex on structural decline. Diversification push incremental. Divestment not an upside risk. Mar-23
TP of Rs 26 (unchanged).
BPCL Results expectations : NA Q2FY22 EBITDA at Rs 44.8 bn (+16% YoY/+38% QoQ) was ~25% above Bloomberg consensus. The
Revenues (Rs mn) 8,15,367 63 EPS up/dngrade : NA beat was led by improved GRM and inventory gains. Reported GRM was strong at USD 6.0/bbl and
EBITDA (Rs mn) 44,777 16 PE up/dngrade : NA implied core GRM at USD 4.7/bbl (+62% QoQ, +205% YoY). Core marketing margin rose 4%
Adj PAT (Rs mn) 26,941 15 TP up/dngrade : NA YoY/+13% QoQ to Rs 6,740/t.
Britannia Inds Results expectations : Below
Volume growth moderated to ~2% YoY (2-year CAGR ~5%) as in-home consumption tailwinds faded
Revenues (Rs mn) 36,074 6 EPS up/dngrade : ▼
– similar to trend seen in H2FY21 post Covid 1.0. EBITDA margin dropped sharply to 15.5% (down
EBITDA (Rs mn) 5,583 (17) PE up/dngrade : ◄►
430 bps YoY) dragged by decline in gross margin (down 500 bps YoY; lowest since FY13 at 37.5%).
Adj PAT (Rs mn) 3,816 (23) TP up/dngrade : ▲
Cadila Healthcare Results expectations : In-line Adj EBITDA (flat YoY) was in line led by steady growth in India (+12% YoY) and US (+3% QoQ) sales;
Revenues (Rs mn) 37,848 3 EPS up/dngrade : ▼ cost controls was partially offset by lower gross margin. While potential near term growth challenges
EBITDA (Rs mn) 8,608 6 PE up/dngrade : ▼ in US remains, it remains well positioned over long term on strong R&D pipeline (Injectables,
Adj PAT (Rs mn) 5,634 0 TP up/dngrade : ▼ Biosimilar, NCE). Revise TP to Rs 570 (vs Rs 630) to factor in increasing (1) pricing pressure in US base
business, and (2) competition in gRevlimid and Covid vaccine. ADD stays.
CESC Results expectations : Above - Q2 PATAMI of Rs 3.35 bn (+24% QoQ) was 6%/ 22% ahead of our/ consensus estimate. Loss
Revenues (Rs mn) 34,940 4 EPS up/dngrade : ◄► contribution from DF business reduced in H1.
EBITDA (Rs mn) 9,400 1 PE up/dngrade : NA - Issuance of tariff order for Kolkata Discom remains pending since FY19. Chandigarh Discom’s LoI
Adj PAT (Rs mn) 3,350 (11) TP up/dngrade : ◄► and Surya Vidyut sale expected in Q3.
- CESC is still a value play at 7.8x FY23E P/E and 1.1x P/B for 8% EPS CAGR over FY21-23, 5.7%
dividend yield and ~14% RoE. Maintain BUY with TP of Rs 120.
Continued…
November 12, 2021 5

Essence of the week
Weekly Note
Q'Sep'21
Cholamandalam Invst Results expectations : Above
Largely in-line operating profit, but PAT at Rs 6.1 bn (up 40.4% YoY) significantly (33.4%) above our
Revenues (Rs mn) 13,928 11 ABV up/dngrade : ▲
expectations due to lower provisions. Despite strong disbursements, AUM growth was relatively
EBITDA (Rs mn) 8,748 (3) PB up/dngrade : ▲
muted. Headline asset quality improved, but higher restructuring book was a spoil sport.
Adj PAT (Rs mn) 6,064 40 TP up/dngrade : ▲
Clean Science & Technology Results expectations : In-line Raw material led inflation impacted gross margin, but price pass-through already in progress; expects
Revenues (Rs mn) 1,532 9 EPS up/dngrade : ◄► gross margin rebound in coming quarters. Capacity expansion across existing/ new products (HALS)
EBITDA (Rs mn) 687 (2) PE up/dngrade : ◄► to aid 25% earnings CAGR over FY21-24E. Expanding universe with new product launches to extend
Adj PAT (Rs mn) 535 (1) TP up/dngrade : ▼ growth runway, but rich valuations limit upside. Downgrade to SELL (from REDUCE).
Coromandel Intl Results expectations : In-line Manufactured fertilizer EBITDA margin at Rs 5,500/ton vs. Rs 5,900 YoY as govt’ higher subsidy &
Revenues (Rs mn) 61,475 33 EPS up/dngrade : ◄► backward integration benefits offset higher RM price hit. Crop Protection Business (CPB) revenue
EBITDA (Rs mn) 7,432 (12) PE up/dngrade : ◄► grew 10% YoY on strong growth in B2B and exports. Revenue contribution from new products steady
Adj PAT (Rs mn) 5,193 (12) TP up/dngrade : ◄► at ~25%. BUY stays with TP of Rs 1,150 (20x Sept’23E EPS) as CPB EBITDA share rises on new product
launches, while fertilizer margin remains stable.
Dabur India Results expectations : Above
Volume-led beat – revenue up 12% YoY (7% beat; 2-year CAGR at 13%), EBITDA margin down
Revenues (Rs mn) 28,176 12 EPS up/dngrade : ◄►
marginally by 60 bps despite RM headwinds. Revise TP to Rs 660 (from Rs 650) as we roll over to Sept-
EBITDA (Rs mn) 6,207 9 PE up/dngrade : ◄►
23E (target P/E of 51x). Retain ADD.
Divi's Labs Results expectations : Below EBITDA (+11% YoY) was 4% below our estimate on higher other costs (28% YoY, 18% QoQ) despite
Revenues (Rs mn) 19,875 16 EPS up/dngrade : ▼ steady 16% YoY sales growth and gross margin. Divi’s highlighted while it is relatively better
EBITDA (Rs mn) 8,181 12 PE up/dngrade : ◄► positioned, it is seeing impact of higher raw material costs and logistics costs on China disruption
Adj PAT (Rs mn) 6,121 17 TP up/dngrade : ▼ issues. While strong positioning to capture global supply opportunities remains, we cut EPS on near
term headwinds and rating to REDUCE (vs. ADD earlier) on rich valuation.
Dr Reddys Results expectations : Above EBITDA (+10% YoY) beat our estimate by 12% on robust growth in India, US, Russia, RoW markets
Revenues (Rs mn) 57,869 18 EPS up/dngrade : ◄► and out-licensing despite lower gross margin (in-line, ex out-licensing). While Covid led growth to
EBITDA (Rs mn) 12,514 1 PE up/dngrade : ▼ normalize in India, exports (Sputnik) could continue; strong R&D pipeline in key markets (US, India,
Adj PAT (Rs mn) 8,240 (1) TP up/dngrade : ▼ Russia, China) to drive growth. Revise TP to Rs 5,500 (vs Rs 5,700 earlier). Maintain BUY on multiple
drivers – US (gVascepa scale-up H2, gRevlimid from FY23), ROW (Sputnik) and India (new launches).
Eicher Motors Results expectations : Above Q2 adj. consol. EBITDA declined by 9% YoY but was 14% above our estimates on higher ASPs –
Revenues (Rs mn) 22,496 5 EPS up/dngrade : ▼ steeper price hike plus mix benefits. EBITDA margin in line. Stronger traction in exports (on a low base
EBITDA (Rs mn) 4,699 (0) PE up/dngrade : ◄► through) and efforts to increase accessories sales are positives but subdued demand still remains a
Adj PAT (Rs mn) 3,732 9 TP up/dngrade : ▲ concern.Valuations demanding and imply 12% volume CAGR over FY23-35E; rising competition from
marquee OEMs over medium term a concern. SELL stays.
Continued…
November 12, 2021 6

Essence of the week
Weekly Note
Q'Sep'21
Emami Results expectations : Above
Revenues (Rs mn) 7,888 7 EPS up/dngrade : ▼ Domestic revenue up 9% YoY (2-year CAGR of ~10%). 140 bps YoY lower adspend drives 8% EBITDA
EBITDA (Rs mn) 2,772 8 PE up/dngrade : ◄► beat. IBD down 6% YoY (up 2% on 2-yr CAGR).
Adj PAT (Rs mn) 2,335 21 TP up/dngrade : ◄►
Eris Lifesciences Results expectations : In-line EBITDA (in line) grew 12% YoY on 9% sales growth coupled with improvement in gross margin (80
Revenues (Rs mn) 3,597 9 EPS up/dngrade : ◄► bps) and EBITDA margin (110 bps) given higher Chronic sales mix. Looking forward to monetize from
EBITDA (Rs mn) 1,398 12 PE up/dngrade : ◄► the strong visibility in anti-diabetes given patent expiry in next 3-4 years. Expects to normalize higher
Adj PAT (Rs mn) 1,183 10 TP up/dngrade : ▲ working capital by year-end. BUY stays with revised TP of Rs 950 (vs Rs 900 earlier) on steady growth
visibility, strong margin/ return ratios, and high cash conversion (~80% EBITDA to FCF).
HDFC Results expectations : Above Higher-than-expected PAT of Rs 37.8 bn (up 31.7% YoY; our est. Rs 32.9 bn) primarily led by higher
Revenues (Rs mn) 56,529 30 ABV up/dngrade : ◄► other income and lower provisions. Advances growth primarily driven by individual book, non-
EBITDA (Rs mn) 51,231 29 PB up/dngrade : ◄► individual book to follow. Asset quality improved; restructuring at 1.4% of loans. Roll forward our
Adj PAT (Rs mn) 37,805 32 TP up/dngrade : ▲ target multiple for standalone and subsidiaries to H1FY24E vs. FY23E earlier.
HPCL Results expectations : NA EBITDA at Rs 30.1 bn (in-line with Bloomberg consensus) declined 16% YoY/6% QoQ due to lower
Revenues (Rs mn) 8,30,645 60 EPS up/dngrade : NA refinery throughput (-38% YoY) and GRM due to MR shutdown to tie in expanded capacity. Reported
EBITDA (Rs mn) 30,136 (16) PE up/dngrade : NA GRM was down 52% YoY/27% QoQ at USD 2.4/bbl. Reported marketing margin (implied) was nearly
Adj PAT (Rs mn) 19,235 (22) TP up/dngrade : NA flat at Rs 7,230/t.
Indian Oil Results expectations : NA Q2 EBITDA at ~Rs 111 bn (+18%/+1% YoY/QoQ) was 23% above Bloomberg consensus. The beat
Revenues (Rs mn) 13,54,177 58 EPS up/dngrade : NA was led by improved GRM and inventory gains. Reported GRM was strong at USD6.6/bbl and implied
EBITDA (Rs mn) 1,10,967 18 PE up/dngrade : NA core GRM at USD4.0/bbl (vs -USD1.0/bbl in Q2FY21 and USD2.2/bbl in Q1FY22). Petchem EBITDA
Adj PAT (Rs mn) 63,600 2 TP up/dngrade : NA margin fell 23% QoQ to USD318/t. Reported marketing margin (implied) was up 20% YoY/16% QoQ
at Rs 7,266/t.
Indraprastha Gas Results expectations : NA
Q2 revenue/EBITDA/PAT rose 40%/30%/19% YoY to Rs 18.31/ 5.30/ 4.0 bn due to strong volumes
Revenues (Rs mn) 18,312 40 EPS up/dngrade : NA
and higher other income (+160% QoQ). Volume grew 32% YoY to 7.24 mmscmd (+10% vs Q2FY20)
EBITDA (Rs mn) 5,302 30 PE up/dngrade : NA
led by 35%/22% YoY growth in CNG/PNG volumes to 5.30/1.94 mmscmd.
Adj PAT (Rs mn) 4,005 30 TP up/dngrade : NA
Jyothy Labs Results expectations : Below
Revenues (Rs mn) 5,854 16 EPS up/dngrade : ▼ Robust revenue growth of 16% (volume growth of ~11%, 2-year CAGR at -10%); operational
EBITDA (Rs mn) 666 (24) PE up/dngrade : ◄► performance hit by sharp ~760 bps YoY GM erosion.
Adj PAT (Rs mn) 446 (29) TP up/dngrade : ▼
Continued…
November 12, 2021 7

Essence of the week
Weekly Note
Q'Sep'21
Kalyan Jewellers Results expectations : In-line Revenue growth of 61% YoY in India and the Middle East driven by strong industry tailwinds and
Revenues (Rs mn) 28,887 61 EPS up/dngrade : ▲ company initiatives. Momentum remains robust in the festive season. Gross margin impacted by (1)
EBITDA (Rs mn) 2,281 111 PE up/dngrade : ◄► high base, (2) low studded share YoY, (3) higher staple gold jewellery sales and (4) lower non-south
Adj PAT (Rs mn) 687 LP TP up/dngrade : ▲ share.
NTPC Results expectations : Below - Adjusted Q2 PAT at Rs 33.5 bn (+6% QoQ) a slight miss due to lower LPSC (led by lower overdue) and
Revenues (Rs mn) 2,83,290 15 EPS up/dngrade : ▲ higher capacity charge under-recovery (nil fuel related).
EBITDA (Rs mn) 76,663 2 PE up/dngrade : NA - Almost no thermal capacity planned for shutdown in next 5 years. RE portfolio at 7.78 GW including
Adj PAT (Rs mn) 33,532 (15) TP up/dngrade : NA pipeline of 6.38 GW.
- Even after assuming strict shutdown of thermal plants in 25 yrs we can explain 88% of CMP. Sizable
RE aspiration adds upside. BUY stays with TP of Rs 180.
Page Industries Results expectations : Above
Robust revenue growth of~46% YoY (18% on 2-year CAGR, 16% beat) led by 43.6% YoY volume
Revenues (Rs mn) 10,840 46 EPS up/dngrade : ▲
growth (up ~12% on 2-year CAGR). EBITDA up ~41% YoY (12% beat); EBITDA margin declined 80
EBITDA (Rs mn) 2,334 41 PE up/dngrade : ▲
bps YoY on 70 bps GM decline and 130 bps higher other expenses (up 59% YoY in absolute).
Petronet LNG Results expectations : NA
Q2 adj EBITDA of Rs 13.6 bn was flat YoY (+29% QoQ) and beat street estimate by 19% led by higher
Revenues (Rs mn) 1,08,131 73 EPS up/dngrade : NA
spot LNG marketing margin which stood at ~USD3/mmbtu. Accordingly, blended gross margin rose
EBITDA (Rs mn) 13,623 (0) PE up/dngrade : NA
8% YoY and 7% QoQ to Rs 64.7/mmbtu, Volume fell 6% YoY to 240 tbtu (+15% QoQ).
Adj PAT (Rs mn) 8,884 (4) TP up/dngrade : NA
Pidilite Industries Results expectations : Below Broad-based revenue growth/ beat (domestic revenue up 36%; 19% 2-year CAGR; 7% beat); CBP
Revenues (Rs mn) 26,264 40 EPS up/dngrade : ▲ (@20%) outperformed B2B growth (@ 13%) on 2-year. Post decline in Q1, VAM prices up again (Q2 at
EBITDA (Rs mn) 5,496 7 PE up/dngrade : ▲ USD 2,000/t; spot ~15% higher); price hikes (10% in Q2)/ scale leverage help keep margin within
Adj PAT (Rs mn) 3,747 5 TP up/dngrade : ▲ historical band.
Power Grid Corp Results expectations : Above - Growth visibility from transmission works-in-hand continues to wane. PWGR expects ~Rs 265 bn
Revenues (Rs mn) 99,292 10 EPS up/dngrade : ▼ project awards in the sector over the next 6-12 months.
EBITDA (Rs mn) 84,470 6 PE up/dngrade : NA - Seeks to deploy ~Rs 250 bn in the Discom reform scheme over next 3-4 years. Entails uncertainty
Adj PAT (Rs mn) 33,383 7 TP up/dngrade : ▼ around return and poses a downside risk to dividends.
- Our TP of Rs 190 (vs. Rs 195 earlier) implies just 3% upside, 1.7x P/B for ~19% RoE and FY21-23 EPS
CAGR of ~5%. Maintain REDUCE.
Shriram Transport Fin Results expectations : Above PAT beat (Rs 7.7 bn, +12.7% YoY, ~10% ahead of estimate) led by lower provisions; PPOP marginally
Revenues (Rs mn) 22,676 9 ABV up/dngrade : ◄► (3.8%) ahead of estimate. AUM growth still soft (7.3% YoY); management expects double digit growth
EBITDA (Rs mn) 17,169 9 PB up/dngrade : ◄► for FY22 which is optimistic. Asset quality improvement along expected lines. ADD stays with revised
Adj PAT (Rs mn) 7,712 13 TP up/dngrade : ▲ TP of Rs 1,600 (1.6x H1FY24E ABV) vs Rs 1,500 earlier on roll over.
Continued…
November 12, 2021 8

Essence of the week
Weekly Note
Q'Sep'21
Sudarshan Chemical Results expectations : Above Q2 revenue growth impacted by floods at Mahad (25-day production loss); margin impacted by sharp
Revenues (Rs mn) 4,980 16 EPS up/dngrade : ▼ inflation across RM, power (coal) and logistics cost. Cut FY23/24E EBITDA by 8-10% on possible
EBITDA (Rs mn) 529 (22) PE up/dngrade : ◄► delays in cost inflation pass through, but new capacity & product launch to revive revenue FY23
Adj PAT (Rs mn) 228 (25) TP up/dngrade : ▲ onwards. Expect PAT to double over FY21-24E (low base in FY22E) as RM inflation passes through.
Upgrade to BUY with revised TP of Rs 770 (23x Sept 23E).
Sumitomo Chemical Results expectations : In-line Domestic revenue declined 5% on erratic monsoon, but exports surged 46% YoY on strong demand
Revenues (Rs mn) 9,104 1 EPS up/dngrade : ▼ aided by new registrations globally – to sustain. GM declined 90 bps YoY to 39% on RM inflation; delay
EBITDA (Rs mn) 2,147 (2) PE up/dngrade : ◄► in pass through to impact near term margin. Cut FY22/23E EPS by 13/5% to factor in this. Cut FY22/
Adj PAT (Rs mn) 1,542 (2) TP up/dngrade : ▲ 23E EPS by 13%/ 5%. Raise TP to Rs 415 (35x Sept’23E EPS) on rollover. Export to aid earnings (23%
CAGR over FY21-24E). Upgrade to ADD.
Sun Pharma Results expectations : Above EBITDA (+20% YoY) beat our estimate by 7% on strong sales growth in India, EM and global specialty
Revenues (Rs mn) 96,259 13 EPS up/dngrade : ▲ business coupled with cost controls. US sales declined QoQ. Expects to outperform IPM^ in India and
EBITDA (Rs mn) 26,299 20 PE up/dngrade : ▲ scale up specialty sales (led by Ilumya); SG&A and R&D costs to increase. Balance sheet turned net
Adj PAT (Rs mn) 21,163 33 TP up/dngrade : ▲ cash ex-Taro. Base business benefited from Covid led portfolio, while scale-up in specialty remains key
positive. Raise EPS and roll over TP to Rs 900. Maintain ADD.
Torrent Power Results expectations : Above - Q2 EBITDA was 3% ahead of estimate led by higher contribution from distribution franchisee (lower
Revenues (Rs mn) 36,476 17 EPS up/dngrade : ▲ T&D loss) and wind generation (higher PLF).
EBITDA (Rs mn) 9,383 32 PE up/dngrade : NA - Targeting 5GW RE by 2025 vs. ~0.8GW operational capacity presently and a pipeline of ~1GW (incl.
Adj PAT (Rs mn) 3,676 15 TP up/dngrade : ▲ 300MW L1 bid in AP which is sub-judice).
- Raise TP to Rs 476 (vs. Rs 460 earlier). At 2.0x FY23E P/B for 2.1% FY20-23 EPS CAGR, ~13% RoE,
TPW is expensive vs CESC (BUY). REDUCE stays.
Ujjivan Small Fin Results expectations : Below Second consecutive quarter of loss; Q2 loss at Rs 2.7 bn primarily on significant deterioration in asset
Revenues (Rs mn) 4,383 (18) ABV up/dngrade : ▼ quality. Floating provisions at Rs 2.5 bn. Disbursement growth picked up meaningfully, but AUM
EBITDA (Rs mn) 710 (69) PB up/dngrade : ◄► growth still sluggish. Higher restructured book to continue asset quality pain in near term. TP
Adj PAT (Rs mn) (2,738) PL TP up/dngrade : ◄► unchanged at Rs 17 as we roll forward TP multiple to H1FY24E ABV (1x).
Varun Beverages Results expectations : Above
Revenues (Rs mn) 23,982 33 EPS up/dngrade : ▲ Healthy 2-year volume CAGR of 11%; Revenue/EBITDA up 33%/30% YoY. EBITDA margin steady as
EBITDA (Rs mn) 4,947 30 PE up/dngrade : ▲ operating leverage offsets 280 bps YoY drag in GM.
Voltas Results expectations : In-line In-line quarter. Strong UCP topline performance more than offset by MEP weakness; better mix and
Revenues (Rs mn) 16,891 5 EPS up/dngrade : ▼ cost controls aid EBITDA margin. We build in 15% topline CAGR on strong recovery in UCP segment;
EBITDA (Rs mn) 1,291 32 PE up/dngrade : ▲ margin to be under pressure in the near term and improve gradually over FY23/24E. Assume coverage
Adj PAT (Rs mn) 1,043 31 TP up/dngrade : ▲ on the stock with revised TP of Rs 1,130 (SoTP based) vs Rs 940 earlier. Strong franchise but we await
better entry point. REDUCE stays.
Source: Companies, Axis Capital
November 12, 2021 9

Essence of the week
Weekly Note
SUMMARIES OF REPORTS RELEASED THIS WEEK

 Eco: October CPI up on food & fuel; September IIP output flat
 Macro Matters – India states fiscal: Spotlight on sales tax collection
 Eco: High Frequency Indicators in October
 Navin Fluorine International: New contract win to aid partnership-led growth
Eco: October CPI up on food & fuel; September IIP output flat (12th Nov) Click for detailed report
(prithviraj.srinivas@axiscap.in; 91 22 4325 1108)

October CPI at 4.5% YoY was tad above consensus and our expectation of 4.3%. Sequential increase in fresh food, fuel and transport
were the main drivers of inflation. Refined core CPI eased to 5.4% YoY vs. 5.6% in Sep with most components moderating sequentially
except ‘personal care & effects’. See detailed CPI breakdown table inside.
September IIP fell sharply to 3.1%% YoY (vs. upward revised 12% in August), far below the consensus estimate of 4.8% or our optimistic
forecast of 5.7%. The deceleration is optical and due to base effect. Industrial output remained ~4% above pre-Covid levels in September
(refer exhibit 12 in report) where IIP is re-indexed to 2019. By sectors, mining slowed while manufacturing and electricity improved.
While looking at output by use, the improvement was mainly led by consumer durables and moderately by infrastructure. At a
disaggregate level, output improved in electronics, electrical, furniture, pharma and wearing apparel. Meanwhile, there was pull back in
machinery, transport equipment, motor vehicles, food and beverages etc. On the whole, forward momentum was broad based with only
10 out of 23 manufacturing sectors witnessing sequential moderation.
Policy outlook: Input price pressures are likely to ease going forward on cut in fuel tax and normalization of weather conditions.
However, we continue to see inflation drifting up and to average ~5% over the next 18 months as recovery in activity sustains pass
through of already elevated input prices.
Given that PMIs continue to indicate improvement in manufacturing demand, supply disturbances could be the only factor holding back
output. So far in Sep, it seems as if output expansion in some sectors is compensating pull back in others.
A potential outcome in coming quarters is a tight supply cycle keeping inflation elevated, which in turn depresses demand. Weaker
demand is just a final outcome of the broken supply cycle. As the supply cycle gets fixed, we should see more headroom open up for
growth. Higher interest rate or tightening of monetary conditions will not help the situation and only increases apprehensions about
growth. This is why we believe that oil prices will lift inflation and impact growth but would not disrupt macro risk.
Macro Matters – India states fiscal: Spotlight on sales tax collection (12th Nov) Click for detailed report

Fiscal tracker for 20 states with data update as of September: States saw marginal rise in revenue growth in September supported by
sales tax and excise. Meanwhile, there is a bump up in expenditure primarily led by capex. Despite this, fiscal deficit is tracking better
than last year and better than budget due to continued restraint in revenue expenditure versus budget target.
Last month we highlighted stamp & registration collections by states. This month we highlight sales tax collection which is mainly levied
on motor fuels. We find that return to normal mobility levels continue to drive sales tax collection growth despite high prices. However,
given that many states have cut taxes on fuel along with the central government in November, we can expect some moderation in sales
tax collection growth going forward. Karnataka, Gujarat, Haryana, Uttar Pradesh, Punjab and Madhya Pradesh have cut their fuel VAT
recently. For these states, sales tax is a notable part of revenue (6 to 14%). Fortunately, for most of the above states, we see that sales tax
collection is running above budget target in the first half of FY22. Most states which cut fuel taxes had room to absorb the revenue
impact.
November 12, 2021 10

Essence of the week
Weekly Note
Eco: High Frequency Indicators in October (08th Nov) Click for detailed report
October high frequency indicators show robust factory and services output despite earlier concerns about supply shortages hurting
output. PMIs, air and rail cargo, fuel sales, airport traffic, GST e-way bills, tax collections and non-oil imports show sturdy sequential
momentum and YoY growth in October. Active COVID cases continue to fall despite near normalization of mobility across the country. If
this trend holds for the next two weeks, we can breathe easy on third COVID wave. While there are reasons to remain optimistic about
the recovery, inflation concerns could counteract some of this positivity to slow the pace of growth down the line. Fortunately, the
government has stepped in to share a part of the rising cost burden.
Fuel excise cut impact: Petrol prices have been reduced by INR 6 to 14/ litre and diesel by INR 10 to 20/ litre across states (see exhibit
28 in report). The CPI impact from fuel tax cuts should be about 17 bps since diesel is not a big part of CPI weight. Recent tax cut in edible
oil and now retail fuel provides some buffer room in CPI projections in case input price pass-through is stronger than expected. Tax cut
impact on FY22 central government finances is about INR 450 bn (0.2% of GDP) which the government can easily absorb and still
outperform on FY22 fiscal consolidation. While the fuel tax cuts have reduced the burden on consumers, retail fuel prices in Mumbai are
still about 40% above pre-pandemic levels (~25% YoY) and still an overhang on real spending power. See recent report on impact of high
oil prices on the economy (link).
October services PMI gathered momentum, rising to 58.4 (vs. 55.2 in September). A notable pick-up in new business led to the fastest
expansion in output in over a decade (highest since July 2011) and resulted in a healthy intake of jobs. Higher fuel, material, retail, staff
and transportation prices pushed up average cost burdens for the sixteenth consecutive month. Anecdotal evidence indicates that prices
were passed on to customers, pushing input and output prices at the strongest rate since July 2017. Weaker international demand in
October caused little change in business sentiment as inflationary concerns counteracted rising new business and output. The Composite
PMI Output Index reached 58.7 in October (vs. 55.3 in September), with the sharpest monthly expansion since January 2012.
Services in expansion everywhere except COVID-impacted Russia

Markit Services PMI
Date Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 Oct-21
West
U.S. 58.4 54.8 59.2 59.8 60.4 64.7 70.4 64.6 59.9 55.1 54.9 58.7
U.K. 47.6 49.4 39.5 49.5 56.3 61 62.9 62.4 59.6 55.0 55.4 59.1
Eurozone 41.7 46.4 44.7 45.7 49.6 50.5 55.2 58.3 59.8 59.0 56.4 54.6
Germany 46.0 47.0 46.7 45.7 51.5 49.9 52.8 57.5 61.8 60.8 56.2 52.4
France 38.8 49.1 47.3 45.6 48.2 50.3 56.6 57.8 56.8 56.3 56.2 56.6
Spain 39.5 48.0 41.7 43.1 48.1 54.6 59.4 62.5 61.9 60.1 56.9 56.6
Italy 39.4 39.7 44.7 48.8 48.6 47.3 53.1 56.7 58.0 58.0 55.5 52.4
Russia 48.2 48.0 52.7 52.2 55.8 55.2 57.5 56.5 53.5 49.3 50.5 48.8
Asia
Australia 55.1 57.0 55.6 53.4 55.5 58.8 58 56.8 44.2 42.9 45.5 51.8
China 57.8 56.3 52.0 51.5 54.3 56.3 55.1 50.3 54.9 46.7 53.2 53.8
India 53.7 52.3 52.8 55.3 54.6 54 46.4 41.2 45.4 56.7 55.2 58.4
Japan 47.8 47.7 46.1 46.3 48.3 49.5 46.5 48.0 47.4 42.9 47.9 50.7
Americas
Brazil 50.1 51.1 47.0 47.1 44.1 42.9 48.3 53.9 54.4 55.1 54.6 54.9
>50 & rising > 50 & slowing @ 50 no momentum <50 & improving < 50 deteriorating
Source: Bloomberg, Markit

Essence of the week
Weekly Note
Navin Fluorine International: New contract win to aid partnership-led growth (11th Nov)
(ankur.periwal@axiscap.in; 91 22 4325 1149) Click for detailed report
* NFIL signed a 5-year contract with a large MNC for in-house developed agro-chem intermediate; capex of Rs 1.25 bn with peak revenue
potential of Rs 1.5-1.7 bn.
* Expected EBITDA margin/ RoE to be in sync with that of the company. Increase FY24E EPS by 4% to factor in the same (commissioning
by FY23 end).
* Outlook robust on growth drivers across high-value businesses (click here), aiding 32% EPS CAGR over FY21-24E. REDUCE stays on
rich valuation.
Key highlights
Thrust on partnership-led growth (with global majors) continues: In continuation to its earlier announcements for expansion in high-
performance products (Rs 4.4 bn capex; 7-year contract) and multi-purpose plants (Rs 2 bn capex; 5 agrochemical products), NFIL has
signed a 5-year contract with an MNC to supply agro chemical intermediate. While the plant is on dedicated basis (take or pay contract if
utilization dips below ~75%), it can be used for other products if required. NFIL is also working on other opportunities in Specialty
Chemicals across agrochem, pharma, industrials etc, some of which may get translated into dedicated investments going ahead.
In-house product development: NFIL developed this product completely in-house with no tech-pack shared by the customer;
improvement in manufacturing process post discussion with client. It took 9-12 months from R&D to pilot and final product approval for
this product. NFIL’s strength in fluorination, engineering skills and availability of building blocks in India led to this business win (China
+1) as this product is already manufactured globally (by client and others). NFIL will be replacing client’s own manufacturing for this
molecule and address rising global opportunity; full utilization expected in Year 2; to evaluate further expansion later.
New product and relatively new customer: This product is new for NFIL (not among the 5 products that it planned for expansion earlier)
with a relatively newer customer (limited business currently). This would possibly open up opportunities to cross sell and ramp up its
commercial relations. This product will earn similar EBITDA margin as Specialty Chemical portfolio with return ratios at par to NFIL.
Other details: (a) This capex would be through NFIL’s 100% subsidiary NFASL (tax efficient); existing backend infra at Dahej to be useful,
(b) Modification of ETP plant (to reduce effluent at source) would need Rs 140 mn spend (part of Rs 1.25 bn capex) and (c) Management
highlighted its preference to phase out such investment opportunities over 6-9 months to effectively develop plant design, technical and
efficient use of management bandwidth and not compromise on quality.

Essence of the week
Weekly Note
EVENT UPDATES RELEASED THIS WEEK

 Auto fuel duty cut – neutral for OMCs, but benefits user industries like cement
 Pharma – Domestic formulations: October 2021 scorecard
Auto fuel duty cut – neutral for OMCs, but benefits user industries like cement
(amit.murarka@axiscap.in ; +91 22 4325 1122)
Event: W.e.f. 4th November 2021, the central government has reduced levies on petrol and diesel by Rs 5/litre and Rs 10/litre,
respectively. This is a partial roll-back of the Rs 10/litre and Rs 13/litre duty hike in petrol and diesel implemented in May’20 to mop up
gains from the sharp decline in crude price post the onset of Covid-19. Following this cut by the centre, several states have also reduced
the VAT rate resulting in a higher effective decline in the price of these fuels.
View: These duty cuts are a non-event for OMCs as the duties are a pass-through to consumer. However, the diesel price cut significantly
benefits the industries heavily dependent on road freight – particularly cement, where freight (inward on RM and outward on sales) is
~30% of total cost. Cement industry cost thus falls by ~Rs 80/t (6% of EBITDA).
Additional info
 Annual sales volume of diesel is ~80mnt and petrol is ~30mnt. This implies an annualized revenue loss to exchequer of ~Rs 950 bn
for diesel and ~Rs 200 bn for petrol.
 Below is the chart depicting movement on central duties (excise, road cess etc) on petrol and diesel in the past six years. As can be
seen from the exhibit, central government has usually raised duties when crude price falls sharply and the same are partially rolled
back during periods of higher crude prices.
Pharma – Domestic formulations: October 2021 scorecard

(prakash.agarwal@axiscap.in; 91 22 4325 1145)
 India domestic formulations recorded a growth of 5% in Oct’21 (vs 12.4% in Sep’21; 14.6% in Q2FY22) as 1.6% decline in volume
(vs 5.3% in Sep’21; 6.3% in Q2FY22) offset by 5.3% price growth (vs 5.6% in Sep’21; 5.7% in Q2FY22). New introduction growth
was at 1.4% growth in Oct’21 (vs 1.4% in Sep’21; 2.4% in Q2FY22).
 Key therapies – while acute therapies such as Gastro and Pain continue to see strong growth on low base of last year, key chronic
therapies like cardiac, anti-diabetic and CNS continue to see muted growth in Oct’21. Other therapies like respiratory continue to
witness strong growth in Oct’21.

Essence of the week
Weekly Note
 Companies’ Oct’21 YoY growth: Sun+Ranbaxy (10%), Cadila (-5%), Cipla (-0.5%), Dr Reddy’s (9.2%), Torrent (14.7%), Alkem (3%),
Glenmark (-18.2%), Lupin (0.3%), IPCA (24.1%), Alembic (0.4%), Ajanta pharma (13.4%), Eris Lifesciences (-0.5%), Natco (-5.5%), JB
Chemicals (-5.9%), Emcure (8.2%), Mankind (16.4%), Abbott (1.6%), GSK (5.1%), Pfizer (-1.1%), Sanofi (-5.4%), Novartis (-11.9%).
 Therapies’ Oct’21 YoY growth: Moderated growth across key therapies
 Among acute segments, anti-infective and Gastro grew by 5.3% YoY and 9.8% YoY respectively. Pain continues to witness
strong growth at 16.6% YoY
 Chronic segments saw muted growth with cardiac declining 1.1% YoY and anti-diabetic growing at 1.2% YoY and CNS at 5.4%
YoY
 Other key segments – while Respiratory saw strong growth of 26.3% YoY, Vitamin declined 3.7% YoY on high base. Derma
growth was flat (0.6%).
 Our view:
 IPM growth normalizing post the Covid led growth in Apr/May’21 given the second wave of Covid. Acute growth remains
steady on low base.
 Expects growth to be muted in Oct/Nov'21 on normal base of last year.
 Alkem, Eris and Torrent remain our top picks in domestic-heavy names.
IPM growth drivers – IPM growth in Oct’21 was driven by price growth
Source: AIOCD
IPM growth drivers
Source: AIOCD

Essence of the week
Weekly Note
Company-wise growth
Source: AIOCD
Therapy-wise growth
Source: AIOCD, % of FY21 sales
______________________________________________________________________________________________________________________________________________________
Remain selective; top picks

 Strong domestic play BUY (Alkem Torrent, Eris) and cost focus (IPCA BUY)
 Diversified plays with strong R&D pipeline BUY - Dr Reddy’s and Aurobindo, ADD – Cadila and Sun Pharma
 Limited competition segments – Biosimilars (Biocon BUY)
 Respiratory (ADD Cipla and Lupin), complex generics (ADD Natco and Glenmark),
 Fair valuation – Syngene (REDUCE); Divi’s (REDUCE); Near term earnings pressure ADD – Alembic pharma
 Hospitals: Growth recovery – Apollo Hospitals (ADD) and Aster DM (BUY)
______________________________________________________________________________________________________________________________________________________

Essence of the week
Weekly Note
Valuation Snapshot
Source: Bloomberg, Companies, Axis Capital; Prices as on 3 rd November 2021

Target multiple is based on Jun’23 EPS; for Biocon, Cipla, Cadila, Dr Reddy’s, Divi’s Lab, Eris, Lupin, Sun Pharma and Syngene target multiple is based on Sep’23 EPS
# Torrent Pharma EPS calculated on PAT (ex post tax amortization); ^ Torrent Pharma TP multiple implied P/E multiple (ex-amortization);
Dr Reddy’s TP includes Rs 240/ sh for ANDA pipeline; Natco TP Rs 350/ sh for ANDA pipeline;
Cadila’s TP includes Rs 20/ sh for vaccine and Rs 30/ sh for gRevlimid ; Cipla’s TP includes Rs 20/ sh for gRevlimid
^^TP based on Jun’23 EV/ EBITDA for Aster DM and Sep’23 EV/EBITDA for Apollo Hospitals

Essence of the week
Weekly Note
MARKET SNAPSHOT
Debt & Money market
10-yr bond yield G-Sec yield curve

6.5 (%) 8
(%)
7
6.3
6
6.1
5
12-Nov-21
5.9
4 week-ago
month-ago
5.7 3
Apr-21
Apr-21
Oct-21
Jun-21
Feb-21
Nov-20
Nov-21
Dec-20
Mar-21
Aug-21
Jul-21
Jan-21
May-21
Sep-21
1 3 5 7 9 10 12 15 20 25 30
Year
Source: Bloomberg Source: Bloomberg
Interest Rate Indicator 10yr-Gsec Yield

Money Market (%) MIFOR (%) Countries 12-Nov-21 05-Nov-21
Call Money 0.01-5.20 MIFORIM1
1 MonthIndex 3.60 US 1.6 1.5
Notice Money 2.75-3.40 MIFORIM3
3 MonthIndex 3.95 UK 0.9 0.8
Term Money 3.20-3.50 MIFORIM6
6 MonthIndex 4.77 Germany (0.3) (0.3)
Market Repo 2.80-2.80 MIFORM12
1 Year Index 5.03 France 0.1 0.1
MIBOR (%) Forward Prem. (%) Japan 0.1 0.1
Overnight 3.39 IRMW1M
1 Month
Index 3.42 Brazil 11.5 11.8
14 Day 3.58 IRMW3M
3 Month
Index 3.75 China 2.9 2.9
1 Month 3.66 IRMW6M
6 Month
Index 4.52 Sweden 0.3 0.2
3 Month 3.86 IRMW12M
12 Month
Index 4.62 India 6.4 6.4
Source: RBI, Bloomberg Source: Bloomberg

Essence of the week
Weekly Note
Major Nifty stock moves this week
Price and volume performance grid

10
Up, but Adani Ports, Up, on
on low Tech Mahindra M&M high
Bharti Airtel
volumes volumes
5
Bajaj Finance,
Bajaj Finserv, Eicher Motors,
BPCL, Cipla, Tata Consumer,
Hero Motocorp, Grasim, HDFC,
Dr Reddy's, Kotak Bk, L&T, Nestle, Infosys,
ITC HDFC Life Britannia Ind
Sun Pharma TCS, ONGC,
Ultratech Reliance Inds,
Cement, Tata Motors,
Price Change 5d (%)
UPL, Titan, Wipro

Shree Cement
0 Asian Paints,
HCL Tech, HUL,
Coal India,
ICICI Bk, IOC, HDFC Bank, Bajaj Auto,
Maruti, NTPC, Axis Bank
JSW Steel, Tata Steel HIndalco
SBI
Power Grid,
SBI Life
(5)
Divi's Lab
(10)
Down, but Down,
on low on high
volumes IndusInd Bank volumes
<
< (50) (25) 0 50 100 >

Average 5d Volume Change (%)
Source: Bloomberg, Axis Capital

Essence of the week
Weekly Note
Major Indices: 3 - Best/ worst performing stocks in each index/sector this week
Note: Green and red bars indicate number of stocks that closed in the positive/ negative
Price Price Avg 5d Price Avg 5d
Best performing stocks Worst performing stocks
Sector 5d % 5d % vol chg % 5d % vol chg %
Nifty 1 Mahindra & Mahindra Ltd 7 237 IndusInd Bank Ltd (13) 131
31 19 Bharti Airtel Ltd 6 (22) Divi's Laboratories Ltd (7) 193

Tech Mahindra Ltd 5 20 State Bank of India (4) (29)
NSE Midcap 100 2 Adani Total Gas Ltd 16 56 Laurus Labs Ltd (9) (27)
Bharat Electronics Ltd 11 (9) Bharat Heavy Electricals Ltd (9) 51
65 35
Prestige Estates Projects Ltd 9 72 Sun TV Network Ltd (7) (41)
BSE-Smallcap 1 Cerebra Integrated Technologies Ltd 32 815 NGL Fine-Chem Ltd (20) 5
Monte Carlo Fashions Ltd 30 423 Hexa Tradex Ltd (16) 94
425 470
Aurum Proptech Ltd 29 374 Godawari Power and Ispat Ltd (15) 155
BSE Auto 2 Mahindra & Mahindra Ltd 7 237 Maruti Suzuki India Ltd (3) (37)
Motherson Sumi Systems Ltd 7 213 Bajaj Auto Ltd (3) 107
11 4
Tube Investments of India Ltd 5 (57) Balkrishna Industries Ltd (3) 74
BSE Bankex (2) Bandhan Bank Ltd 4 (48) IndusInd Bank Ltd (13) 131
Kotak Mahindra Bank Ltd 1 (21) City Union Bank Ltd (6) (11)
2 8
AU Small Finance Bank Ltd (1) (46) State Bank of India (4) (29)
BSE Cap Goods 4 Thermax Ltd 11 954 Bharat Heavy Electricals Ltd (9) 51
Bharat Electronics Ltd 11 (9) V-Guard Industries Ltd (3) (22)
17 4
Timken India Ltd 10 1,056 Bharat Forge Ltd (1) 411
BSE FMCG 1 GRM Overseas Ltd 14 66 Chaman Lal Setia Exports Ltd (15) 574
SH Kelkar & Co Ltd 14 1,441 KRBL Ltd (11) 293
48 32
McLeod Russel India Ltd 12 394 Rossell India Ltd (10) 453
BSE Healthcare (1) Aster DM Healthcare Ltd 7 26 NGL Fine-Chem Ltd (20) 5
HealthCare Global Enterprises Ltd 7 240 Marksans Pharma Ltd (12) 209
40 50
Syncom Formulations India Ltd 6 58 Solara Active Pharma Sciences Ltd (10) 351
NSE IT 3 Larsen & Toubro Infotech Ltd 7 34 HCL Technologies Ltd (1) 23
Coforge Ltd 7 1 Tata Consultancy Services Ltd 0 (18)
9 1
L&T Technology Services Ltd 6 (5) Wipro Ltd 1 33
BSE Metal (1) APL Apollo Tubes Ltd 7 289 Jindal Steel & Power Ltd (6) 38
Vedanta Ltd 5 26 Steel Authority of India Ltd (5) (35)
4 6
Hindustan Zinc Ltd 2 41 Tata Steel Ltd (3) 86
BSE Oil & Gas 4 Adani Total Gas Ltd 16 56 GAIL India Ltd (2) (15)
Hindustan Petroleum Corp Ltd 8 37 Indian Oil Corp Ltd (1) 20
8 2
Gujarat Gas Ltd 5 2 Oil & Natural Gas Corp Ltd 2 7
BSE Power 3 Thermax Ltd 11 954 Bharat Heavy Electricals Ltd (9) 51
Adani Transmission Ltd 9 61 KEC International Ltd (2) (14)
10 4
Adani Green Energy Ltd 8 73 Power Grid Corp of India Ltd (2) 24
BSE PSU (0) Bharat Electronics Ltd 11 (9) Bharat Heavy Electricals Ltd (9) 51
Hindustan Petroleum Corp Ltd 8 37 REC Ltd (5) (8)
32 28
General Insurance Corp of India 7 210 Steel Authority of India Ltd (5) (35)
BSE Realty (1) Prestige Estates Projects Ltd 9 72 Sobha Ltd (6) (22)
Phoenix Mills Ltd/The 6 21 Godrej Properties Ltd (6) (36)
5 5
Indiabulls Real Estate Ltd 5 (9) Oberoi Realty Ltd (6) (59)
Source: Bloomberg Note: Average 5d volume change = current 5d average vs. previous 5d average

Essence of the week
Weekly Note
Indian markets
FII net flows in Asian equities Nifty: 50 & 200 DMA

Country Last WTD MTD CYTD Nifty Index 200DMA 50DMA
(USD mn) Update
18,000
India - FII 11-Nov 53 103 6,362
India - DII 12-Nov 727 773 5,116 15,000
Indonesia 11-Nov (28) 78 2,880
12,000
Philippines 11-Nov 30 47 (1,687)
Korea 12-Nov 451 753 (27,939) 9,000
Taiwan 11-Nov 881 1,565 (17,404)
Thailand 11-Nov 104 59 (1,944)
6,000
Note: WTD/ MTD/ YTD represents the cumulative net flows
3,000
since the 1st business day of the week, month & year
Oct-10
Oct-11
Oct-12
Oct-13
Oct-14
Oct-15
Oct-16
Oct-17
Oct-18
Oct-19
Oct-20
Oct-21
Source: Bloomberg, BSE, NSE, SEBI
Volumes: 90 DMA Market delivery: 90 DMA NSE: Adv /Dec ratio

Cash Derivatives (RHS)
10.3 (USD bn) 860 41 (%) 1.6
1.4
10.2 820
40 1.2
10.1 780 1.0
10.0 740 39 0.8
0.6
9.9 700
38 0.4
9.8 660 0.2
9.7 620 37 0.0
Aug-21 Sep-21 Oct-21 Nov-21 Aug-21 Sep-21 Oct-21 Nov-21 08-Nov 09-Nov 10-Nov 11-Nov 12-Nov
Source: Bloomberg, BSE, NSE, Axis Capital
Sectoral indices: 5-day performance ADR/GDR prices*

BSE Oil & Gas 3.8
CMP 5d chg Prem / (Disc)
BSE Cap Goods 3.6
Company name (USD) (%) %
BSE Power 3.2
NSE IT 2.8 Dr Reddys Lab 65.0 2.5 (0.1)
BSE Auto 1.6 HDFC Bank 71.7 0.9 14.4
NSE Midcap 1.5 ICICI Bank 20.7 0.2 (0.9)
BSE Smallcap 1.1
Infosys 23.6 3.4 (1.5)
Nifty 1.0
Sensex 1.0 ITC 3.1 3.3 0.3
BSE FMCG 0.6 L&T 26.5 3.9 0.4
BSE PSU (0.5)
Reliance Industries 70.0 2.0 0.4
BSE Healthcare (0.6)
BSE Metal (1.0) State Bank of India 68.5 (3.4) (0.3)
BSE Realty (1.2) Tata Motors 33.4 2.0 (1.9)
BSE Bankex (2.0) (%)
Wipro 9.1 1.1 2.3
(3) (2) (1) 0 1 2 3 4 5
Source: Bloomberg * Data as on Thursday

Essence of the week
Weekly Note
Bulk deals (> Rs 100 mn traded value)

Date Company Client Traded Vol Traded Value Avg. Price
('000) (Rs mn) (Rs)
BUY
03-Nov-21 Minda Corp WHV - Eam International Small Cap Equity Fund 1,549 270 175
08-Nov-21 Kirl pnu PGIM India Mutual Fund 500 199 397
09-Nov-21 Fairchem Organics IIFL Asset Management 79 149 1875
09-Nov-21 Fairchem Organics IIFL Asset Management 297 556 1875
09-Nov-21 Fairchem Organics IIFL Special Opportunities Fund 413 775 1874
09-Nov-21 Fairchem Organics Public Sector Pension Investment Board 275 516 1875
09-Nov-21 SH Kelkar Firmenich Aromatics Production India 14,118 2,442 173
10-Nov-21 Fairchem Organics Massachusetts Institute Of Technology 83 156 1875
10-Nov-21 Fairchem Organics Massachusetts Institute Of Technology 402 754 1875
11-Nov-21 Apl Apollo Tubes DSP Mutual Fund 1,472 1,325 900
SELL
03-Nov-21 Nazara Technologies WHV-Eam International Small Cap Equity Fund 161 372 2302
08-Nov-21 Kirl pnu HDFCMutual Fund 500 199 397
08-Nov-21 Poonawalla Celica Developers 13,500 2,317 172
08-Nov-21 Poonawalla Microfirm Capital Private 13,500 2,333 173
09-Nov-21 Fairchem Organics FIH Mauritius Investments 1,300 2,440 1877
09-Nov-21 Fairchem Organics Nahoosh Tradelink 175 330 1883
09-Nov-21 SH Kelkar Blackstone Capital Partners Singapore 14,026 2,426 173
10-Nov-21 Fairchem Organics FIH Mauritius Investments 500 938 1875
11-Nov-21 Apl Apollo Tubes APL Infrastructure 3,002 2,702 900
11-Nov-21 Apl Apollo Tubes Rahul Gupta 1,501 1,351 900

Essence of the week
Weekly Note
Deciphering derivatives
Stocks with highest open interest (value-wise)

Open Interest OI Chg % of OI Value CMP Price Chg
Company Trend
(mn shrs) % Float (Rs bn) (Rs) (%)
RELIANCE 36 4% 1.1 91 2,556 2.2% Fresh Long
ICICIBANK 92 14% 1.4 71 774 -1.1% Fresh Short
INFY 40 5% 1.1 70 1,733 1.4% Fresh Long
ADANIPORTS 95 -1% 12.6 70 736 3.0% Short Covering
TCS 17 3% 1.6 59 3,498 -0.3% Fresh Short
TATASTEEL 45 12% 6.0 58 1,304 -1.7% Fresh Short
HDFCBANK 38 24% 0.9 58 1,554 -2.6% Fresh Short
ITC 250 5% 2.9 58 230 1.6% Fresh Long
SBIN 113 -6% 2.9 57 511 -3.8% Long Liquidation
VEDL 163 14% 9.0 53 325 3.7% Fresh Long
NIFTY 12 7% 214 17,897 -0.1% Fresh Short
Nifty FII flows vs Nifty open interest FII flows

0.8 18123 30 (Rs bn) 11-Nov 10-Nov 9-Nov 8-Nov 4-Nov Wkly
18070 20 Index futures
FII FLOW (INR bn)
0.4
Nifty OI Shrs (mn)
18023 - Buy 42.4 26.0 24.0 68.5 2.4 163.3

10
- Sell 40.5 31.2 50.3 45.3 2.4 169.7
0.0 0 Net 1.9 (5.2) (26.3) 23.2 0.0 (6.4)
17917
Stock futures
(10)
(0.4) 17897 - Buy 130.5 142.6 148.3 177.4 7.8 606.6
(20) - Sell 137.9 154.8 156.8 190.5 9.8 649.8
(0.8) (30) Net (7.4) (12.2) (8.5) (13.1) (2.0) (43.2)
18-Oct 9-Nov 10-Nov 11-Nov Net futures (5.5) (17.4) (34.8) 10.1 (2.0) (49.6)
Nifty OI Shrs (LHS) FII FLOW (RHS) NIFTY
Increase in OI (WoW) Decrease in OI (WoW)

Current OI OI Chg Chg (%) Current OI OI Chg Chg (%)
Company CMP (mn shrs) (mn shrs) OI Value Price Company
oi chg % CMP (mn shrs) (mn shrs) OI Value Price oi chg %
BRITANNIA 3651 1.4 0.3 30 (0.1) ABFRL30% 302 10.0 (1.8) (11.9) 4.0 -15
POWERGRID 183 25.9 4.2 17 (1.4) AMBUJACEM
19% 423 12.0 (2.1) (13.2) 1.9 -15
HINDALCO 455 27.5 4.4 14 (3.9) ONGC 19% 151 42.7 (5.7) (11.4) 0.3 -12
OI value break-up Sector watch – Metals

(Rs bn) 11 Nov - Open Int Value. Current OI OI Price
Scrip CMP
Instrument Total FII * Local FII % (mn shrs) Chg Chg
Futures Index 307 74 233 24.0 HINDALCO 27.55 19% 455 -4%
Futures Stocks 2,161 667 1,494 30.9 JINDALSTEL 39.69 8% 403 -5%
Options Index 3,495 524 2,970 15.0 JSWSTEEL 45.61 4% 668 -2%
Options Stocks 1,754 124 1,630 7.1
SAIL 174.49 -1% 117 -2%
Total 7,717 1,389 6,328 18.0
VEDL 163.13 14% 325 4%
Local - Other than FIIs
FII OI - single side positions have been considered. TATASTEEL 44.83 12% 1,304 -2%

Essence of the week
Weekly Note
Nifty Fifty (open interest data as per Thursday, November 11, 2021)
 NIFTYJR (44243) bounced off from 50 DMA support indicating more strength in broader market vs frontline stocks. A move above
the recent high of 45k would mark further higher levels for the index. Ratio chart vs Nifty50 too has formed basing pattern
indicating further strength and outperformance in index components.
 NSEIT is technically trading closer to its 50DMA support while the ratio vs Nifty too is making lower lows indicating
outperformance from hereon on daily charts. Weekly charts had multiple supports at 35325 forming positive divergence with RSI,
indicating further strength here from.
 Going ahead, market will be volatile led by macro data, news about Covid infections and vaccination, global cues and INR vs USD.
 Nifty futures hit intra-week high of 18160 and low of 17737 to close at 18145 (-1.1%). Open Interest at 13 mn shares – shed
0.73 mn (5.3%) WoW.
 Maximum Open Interest in 17500 put at 2.1 mn shares (added 0.64 mn shares) and 18000 call at 7.20 mn shares (added 3.7 mn
shares).
Nifty futures vs. Smart Money (SMR= IV/PCR) Nifty futures vs. Implied Volatility
Implied volatility Nifty futures (RHS)
SMR Nifty futures (RHS)
250 21,000 120 21,000
19,000 19,000
100
200 17,000
17,000
80
15,000 15,000
150
13,000 60 13,000
100 11,000 11,000
40
9,000 9,000
50 20
7,000 7,000
0 5,000 0 5,000
May-20
May-21
May-20
May-21
Sep-20
Sep-21
Jan-20
Jan-21
Jul-20
Jul-21
Sep-20
Sep-21
Jan-20
Jan-21
Nov-19
Nov-20
Nov-21
Mar-20
Mar-21
Jul-20
Jul-21
Nov-19
Nov-20
Nov-21
Mar-20
Mar-21
Nifty futures vs. put-call ratio Option distribution

Open interest Change OI
Put-call ratio (LHS) Nifty futures (RHS)
8 (mn shrs)
2.0 21,000
7
19,000
1.6 6
17,000
15,000 5
1.2
13,000 4
0.8 11,000 3
9,000 2
0.4
7,000 1
0.0 5,000 0
May-20
May-21
Jan-20
Jan-21
Sep-20
Sep-21
Nov-19
Jul-20
Nov-20
Jul-21
Nov-21
Mar-20
Mar-21
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
PE
CE
17500
17600
17700
17800
17900
18000
18100
18200
18300
18400
18500

Essence of the week
Weekly Note
Global sector equity performance
5-day: Best/ worst performing sectors*

Note: Best sector = shaded green; Worst sector = shaded red; sector classification as per GICS
Markets Developed BRIC Asian
Country US UK Japan Brazil Russia India China HK Korea S'Pore Taiwan
Index S&P FTSE Nikkei Bovespa Micex Nifty HSCEI HSI Kospi Straits Taiex
Index Value 4,649 7,384 29,610 1,07,595 4,189 18,103 9,114 25,328 2,969 3,228 17,518
Index Performance (0.8) 1.4 (0.0) 4.0 0.1 1.0 3.3 1.8 (0.0) (0.4) 1.3
Automobiles & Components (12) - 1 - - 1 (4) (4) (3) - (0)
Banks 0 (0) 0 1 (5) (1) 2 1 0 (1) 2
Capital Goods (0) 2 1 (4) - 3 3 3 (1) 1 (0)
Diversified Financials (0) 0 (3) 0 (2) 2 - (0) 1 (0) (2)
Energy (2) (2) (0) 1 (0) 3 1 2 (3) - 0
Food Beverage & Tobacco - - - - - - - - - - -
Household & Personal Products 0 2 (3) (14) - (1) - (1) (2) - 1
Materials 2 3 (0) 3 4 0 2 - 0 - 2
Pharmaceuticals, Biotechnology 2 (2) (1) 0 - (1) 5 3 (3) - (2)
Software & Services (1) (2) 1 (0) 0 2 - - (1) - 1
Telecommunication Services (1) 3 4 (1) 0 6 (3) (2) 1 2 1
Utilities (1) 2 (1) 4 (1) (1) 3 (1) (0) (0) (1)
Source: Bloomberg, Axis Capital Note: *US, UK Brazil and Russia performance are with 1-day lag
Global equity valuations
Global indices*
PER (x) PBR (x) ROE (%) Div Yield (%)
Country
Index
Mcap CY21 CY22 CY21 CY22 CY21 CY22 CY21
Indices value
($bn)
Developed
US (Dow Jones) 53,528 36,004 19 19 4.9 4.4 26 24 1.8
US (S&P 500) - 4,652 22 21 4.6 4.2 21 20 1.3
UK (FTSE 100) 3,613 7,384 13 12 1.8 1.7 15 14 4.0
Germany (DAX) 2,796 16,083 15 14 2.0 1.9 13 13 2.5
France (CAC) 3,438 7,060 17 15 2.0 1.9 12 12 2.6
Japan (Nikkei 225) 6,796 29,610 18 17 1.9 1.8 11 11 1.7
BRIC
Brazil (IBOV) 825 1,07,595 8 8 1.6 1.5 21 18 6.7
Russia (Micex) 865 4,189 7 6 1.2 1.1 18 17 7.9
India (Nifty) 3,521 18,103 25 21 3.6 3.2 15 15 1.2
China (HSCEI) 12,363 9,114 11 9 1.2 1.1 12 12 3.0
Asian
HK (H S I) 6,247 25,328 13 11 1.3 1.2 10 10 2.8
Korea (Kospi) 2,113 2,969 11 11 1.2 1.1 11 10 1.7
Singapore (Straits) 462 3,228 15 13 1.1 1.1 8 8 3.8
Taiwan (Taiex) 2,166 17,518 13 14 2.4 2.3 18 16 3.8
Source: Bloomberg *Western market data as on Thursday

Essence of the week
Weekly Note
Global asset class performance*
Equity 5-day performance (%)

Performance (%)
Value 1m 12m CYTD
Developed Brazil 4.0
US (S&P 500) 4,649 7 32 24 China 3.3
UK (FTSE 100) 7,384 3 16 14
HK 1.8
Germany (DAX) 16,083 6 23 17
India 1.5
France (CAC) 7,060 8 32 28
UK 1.4
Japan (Nikkei 225) 29,610 2 17 8
BRIC Taiwan 1.3
Brazil (IBOV) 1,07,595 (5) 3 (11) France 1.0
Russia (Micex) 4,189 (3) 36 25 Germany 0.3
India (Nifty) 18,103 1 43 29 Russia 0.1
China (HSCEI) 9,114 2 (14) (15) Japan (0.0)
Asian Singapore (0.4)
HK (H S I) 25,328 0 (3) (7) Korea (0.5)
Korea (Kospi) 2,969 (2) 19 3
US (0.7)
Singapore (Straits) 3,228 2 19 14
Taiwan (Taiex) 17,518 4 32 19 (2.5) 0.0 2.5 5.0
Equity – USD terms 5-day performance – USD terms (%)

Performance (%)
Value 1m 12m CYTD
Developed Brazil 8.2
US (S&P 500) 4,649 7 32 24 China 3.2
UK (FTSE 100) 9,873 1 17 12 HK 1.7
Germany (DAX) 18,417 5 18 9 India 1.6
France (CAC) 8,084 6 26 19
Taiwan 1.4
Japan (Nikkei 225) 260 5 7 (2)
Russia 0.9
BRIC
UK 0.5
Brazil (IBOV) 19,904 (2) 3 (14)
Russia (Micex) 59 (2) 49 33 France 0.2
India (Nifty) 243 2 43 27 Korea 0.1
China (HSCEI) 1,170 3 (14) (16) Germany (0.5)
Asian Japan (0.5)
HK (H S I) 3,250 1 (4) (7) Singapore (0.6)
Korea (Kospi) 3 3 13 (5) US (0.7)
Singapore (Straits) 2,386 4 19 11
Taiwan (Taiex) 630 8 36 20
(3.0) 0.0 3.0 6.0 9.0
USD INR Futures: 1m = 74.77; 3m = 75.23; 5m = 75.87
Source: Bloomberg, Axis Capital Note: *Western markets, Commodity & Currency data as on Thursday

Essence of the week
Weekly Note
Commodity* 5-day performance (%)

1yr fwd Performance (%)
Value Value 1m 12m CYTD
Metals
Aluminium ($/ton) 2,629 2,657 (13) 40 35
Silver 6.1
Copper ($/ton) 9,544 9,811 2 43 27
Platinum 5.8
Zinc ($/ton) 3,180 3,293 2 26 21
Aluminium 4.9
Lead ($/ton) 2,309 2,397 5 29 21
Wheat 4.8
China HR Steel ($/ton) 776 (16) 23 8
Rough Rice 4.6
IronOre-Qingdao ($/ton) 90 (22) (26) (44)
Palladium 2.8
Gold ($/t oz) 1,867 1,818 6 (1) (2)
Crude Oil 2.6
Silver ($/t oz) 25 25 12 4 (5)
Sugar 2.5
Platinum ($/t oz) 1,099 1,089 7 22 1
Cotton 2.2
Palladium ($/t oz) 2,068 2,061 1 (12) (15)
Naptha 2.1
Energy
Coal-Richards Bay ($/ton) 94 137 (43) 96 50
Gold 2.0
Crude Oil ($/bbl) 76 83 (1) 94 61 Corn 1.8
Naptha ($/bbl) 87 4 122 72 Copper 1.1
HH Natural Gas ($/MMBtu) 4.8 (11) 79 101 NBP Nat Gas 1.0
NBP Natural Gas ($/MMBtu) 25.8 (10) 396 251 Lead 1.0
Food Zinc 0.2
Wheat ($/bu) 811 824 10 34 28 Soybean (0.1)
Corn ($/bu) 545 578 9 42 31 Steel (2.4)
Cotton (c/lb) 91 115 10 64 52 Coal (5.5)
Rough Rice ($/cwt) 14 14 0 18 16 HH Nat Gas (15.6)
Soybean ($/bu) 1,229 1,222 1 19 11
(20) (15) (10) (5) 0 5 10
Sugar (c/lb) 19 20 0 47 41
Currency* 5-day performance (%)

Performance (%)
Value 1m 12m CYTD Brazil 3.7
Dollar Index# 95.2 1 2 6
$ Index# 0.9
Developed
Europe 1.1 (1) (3) (6) Russia 0.2
UK 1.3 (1) 2 (2) Korea 0.2
Japan 114.1 (0) (8) (9) China 0.1
BRIC India 0.0
Brazil 5.405 2 1 (4)
HK (0.1)
Russia 71.6 (1) 7 3
India 74.4 1 0 (2)
Singapore (0.2)
China 6.39 1 4 2 Japan (0.3)
Asian Europe (0.9)
HK 7.8 (0) (0) (1) UK (0.9)
Korea 1,180.9 2 (5) (8)
Singapore 1.4 0 (0) (2) (3.0) 0.0 3.0 6.0
USD INR Futures: 1m = 74.77; 3m = 75.23; 5m = 75.87
Note: *Western markets, Commodity & Currency data as on Thursday; # Indicates general international value of USD by averaging
exchange rates between USD and 6 major world currencies

Essence of the week
Weekly Note
SUMMARY OF MAJOR TARGET PRICE UPSIDES
Mcap > USD 5 bn & upside > 15% Mcap > USD 2 bn and < 5 bn & upside > 15%
Mcap CMP TP % Mcap CMP TP %
Company Company
(USD mn) (Rs) (Rs) Upside (USD mn) (Rs) (Rs) Upside
NTPC 17,747 136 180 32 Coromandel Intl 3,122 792 1,150 45

Mah & Mah 15,653 937 1,230 31 Natco Pharma 2,034 830 1,100 32
PI Industries 5,580 2,738 3,530 29 Indraprastha Gas 4,682 498 590 18
SBI Life 15,784 1,175 1,470 25 Emami 3,332 558 660 18
ITC 38,585 233 290 24 Petronet LNG 4,773 237 280 18
Torrent Pharma 6,341 2,790 3,400 22 LIC Housing 3,185 431 500 16
Hindustan Unilever 75,970 2,407 2,850 18 Alembic Pharma 2,061 781 900 15
Tata Motors 24,560 507 600 18 Source: Axis Capital
Alkem Labs 5,704 3,551 4,200 18

ICICI Lombard 9,950 1,510 1,780 18 Mcap > USD 2 bn & downside > 15%
HDFC AMC 7,669 2,678 3,150 18
Mcap CMP TP %
Hero MotoCorp 7,201 2,683 3,150 17 Company
(USD mn) (Rs) (Rs) Upside
Aurobindo Pharma 5,415 688 800 16
JSW Energy 7,130 323 116 (64)
Cadila Healthcare 6,771 492 570 16
BHEL 3,050 65 26 (60)
Bajaj Auto 14,138 3,637 4,200 15
Bajaj Finance 61,433 7,577 4,300 (43)
Biocon 5,593 347 400 15
Oberoi Realty 4,756 974 635 (35)
Godrej Consumer 12,625 919 1,060 15
Macrotech Developers 7,583 1,262 830 (34)
Godrej Properties 8,562 2,293 1,550 (32)
Balkrishna Industries 6,132 2,361 1,600 (32)
Indian Energy Exchange 3,191 793 542 (32)
Titan Inds 30,279 2,539 1,800 (29)
Avenue Supermarts 44,179 5,077 3,600 (29)
Siemens 11,408 2,385 1,720 (28)
TVS Motor 4,654 729 535 (27)
Container Corp 5,620 687 540 (21)
Berger Paints 10,365 794 625 (21)
Bandhan Bank 6,726 311 250 (20)
Eicher Motors 9,999 2,722 2,200 (19)
Asian Paints 40,238 3,123 2,550 (18)
Cholamandalam Invst 7,303 662 550 (17)

Essence of the week
Weekly Note
Axis Capital: Valuation & recommendation

Mcap CMP CYTD TP Upside FDEPS (Rs) PE (x) PB (x) EV/EBITDA (x) RoE (%) Div Yield (%)
Sector/ Company Rating (USD mn) (Rs) (%) (Rs) (%) FY21 FY22E FY23E FY21 FY22E FY23E FY21 FY22E FY23E FY21 FY22E FY23E FY21 FY22E FY23E FY21 FY22E FY23E
Autos - - - 40 36 23 4.8 4.4 3.9 24 20 12 9 10 18 1.0 1.0 1.4
Amara Raja Batteries Reduce 1,599 697 (25) 700 0 38 37 42 18 19 16 2.8 2.6 2.3 10 10 8 16 14 15 1.6 1.6 1.8
Apollo Tyres Add 1,984 233 31 250 8 15 11 17 15 21 13 1.3 1.2 1.1 7 7 6 9 6 9 1.5 1.2 1.2
Ashok Leyland Add 5,741 146 53 140 (4) (1) 1 6 - 131 24 6.1 6.1 5.3 85 31 13 (4) 5 23 0.4 0.7 1.5
Bajaj Auto Add 14,138 3,637 6 4,200 15 157 170 219 23 21 17 4.2 4.1 4.0 17 15 11 20 19 24 3.8 4.2 5.4
Balkrishna Industries Sell 6,132 2,361 44 1,600 (32) 61 72 78 39 33 30 7.6 6.5 5.6 25 21 19 21 21 20 0.7 0.8 0.9
Bharat Forge Sell 4,844 775 48 690 (11) 4 22 27 172 36 29 6.7 5.9 5.1 44 19 16 4 17 19 0.3 0.8 0.9
Eicher Motors Sell 9,999 2,722 8 2,200 (19) 49 66 102 55 41 27 6.6 6.0 5.1 38 29 19 13 15 21 0.6 0.7 0.9
Endurance Technologies Add 3,432 1,816 35 1,800 (1) 38 49 64 48 37 28 7.2 6.2 5.2 24 19 15 16 18 20 0.3 0.5 0.6
Exide Inds Add 2,072 182 (5) 195 7 9 9 10 20 20 17 2.2 2.1 2.0 11 11 9 11 11 12 1.1 2.2 2.2
Hero MotoCorp Add 7,201 2,683 (13) 3,150 17 148 158 190 18 17 14 3.5 3.3 3.1 11 10 8 20 20 23 3.9 4.1 5.0
Mah & Mah Buy 15,653 937 30 1,230 31 35 41 51 27 23 18 3.1 2.8 2.5 17 16 12 12 13 14 0.9 0.9 1.1
Mahindra CIE Buy 1,411 277 61 320 15 3 16 18 99 18 16 2.1 2.0 1.7 24 10 8 2 12 12 - - -
Maruti Suzuki Reduce 30,343 7,478 (2) 6,600 (12) 140 118 254 53 63 29 4.4 4.2 3.8 34 34 17 8 7 14 0.6 0.5 1.0
Minda Industries Add 3,591 936 135 970 4 8 12 25 124 77 38 11.3 8.2 6.8 38 30 19 10 13 20 0.1 0.2 0.2
Motherson Sumi Add 10,422 246 49 255 4 3 6 10 70 39 25 6.2 5.7 4.9 20 14 10 9 15 21 0.6 0.4 0.4
MRF Sell 4,455 78,194 3 70,000 (10) 3,012 2,406 3,557 26 33 22 2.5 2.3 2.1 10 13 10 10 7 10 0.2 0.2 0.2
Suprajit Engg Buy 707 380 90 430 13 11 13 17 36 30 22 5.4 4.8 4.0 22 18 14 16 17 20 0.5 0.5 0.7
Tata Motors Buy 24,560 507 176 600 18 (13) (9) 32 - - 16 3.5 3.7 3.0 8 9 4 (9) (6) 21 0.0 0.0 0.0
TVS Motor Reduce 4,654 729 50 535 (27) 13 20 28 57 36 26 8.3 7.1 5.9 24 18 14 16 21 25 0.5 0.8 1.0
Banks - Pvt Adj BV (INR) - - - - - - - - - - - - - - -
Bandhan Bank Sell 6,726 311 (23) 250 (20) 95 95 114 23 - 15 3.3 3.3 2.7 - - - 14 (4) 19 - - 0.6
Equitas Small Fin Buy 1,000 65 73 80 23 28 33 36 19 31 16 2.3 2.0 1.8 - - - 13 7 11 - 0.5 1.3
Ujjivan Small Fin Sell 484 21 (47) 17 (18) 15 13 16 434 - 12 1.4 1.6 1.3 - - - 0 (13) 11 - - 1.2
NBFC Adj BV (INR) 58 39 30 7.5 6.4 5.4 13 15 16 0.5 0.6 0.7
Bajaj Finance Sell 61,433 7,577 43 4,300 (43) 601 710 860 103 63 46 12.6 10.7 8.8 - - - 13 18 21 0.1 0.1 0.2
Cholamandalam Invst Reduce 7,303 662 71 550 (17) 104 118 148 36 26 22 6.3 5.6 4.5 - - - 17 20 20 0.2 0.5 0.7
HDFC Buy 72,747 2,995 17 3,320 11 467 517 575 24 21 19 3.4 3.1 2.7 - - - 12 12 12 0.7 0.8 0.8
Home First Finance Buy 872 742 - 825 11 155 172 194 65 40 34 4.8 4.3 3.8 - - - 9 11 12 - 0.1 0.1
L&T Finance Holdings Add 2,857 86 (1) 98 14 72 73 78 22 18 13 1.2 1.2 1.1 - - - 6 6 8 - 1.3 1.5
LIC Housing Buy 3,185 431 19 500 16 334 360 416 8 13 7 1.3 1.2 1.0 - - - 14 8 12 1.9 2.0 2.1
Piramal Enterprises * Add 8,506 2,653 86 3,050 15 1,508 1,492 1,576 42 26 21 1.8 1.8 1.7 - - - 4 7 8 1.3 1.4 1.7
Repco Home Finance Buy 246 293 26 400 36 300 343 397 6 6 5 1.0 0.9 0.7 - - - 15 14 14 0.9 1.0 1.1
SBI Cards Reduce 13,749 1,086 28 1,055 (3) 65 81 101 104 59 45 16.7 13.4 10.8 - - - 17 24 26 - 0.2 0.4
Shriram City Union Fin Add 1,858 2,093 97 2,365 13 1,079 1,253 1,444 14 12 10 1.9 1.7 1.5 - - - 13 14 14 1.0 1.1 1.1
Shriram Transport Add 5,859 1,623 55 1,600 (1) 719 844 942 17 16 13 2.3 1.9 1.7 - - - 13 12 12 0.7 1.1 1.2
Spandana Sphoorty Buy 453 524 (30) 810 55 416 454 537 23 9 6 1.3 1.2 1.0 - - - 5 13 18 - 1.9 2.9
Continued…

Essence of the week
Weekly Note
AMC 44 39 35 10.4 8.9 8.2 26 23 22 0.3 0.7 0.9
Aditya Birla Capital Buy 3,457 107 25 114 7 3 3 4 41 31 26 2.2 2.2 2.2 - - - 6 7 7 - - -
HDFC AMC Add 7,669 2,678 (8) 3,150 18 59 62 68 45 43 39 14.1 11.9 10.9 - - - 36 30 29 0.4 1.0 1.3
Insurance 86 89 83 15.4 13.1 11.4 Price to Embedded Val 17 15 14 0.1 0.1 0.1
Chola Fin Hldgs Buy 1,806 716 34 970 35 44 55 70 16 13 10 16.3 13.0 10.2 - - - 17 18 19 0.1 0.3 0.5
HDFC Life Buy 19,575 720 7 800 11 6 7 6 112 107 118 20.8 17.3 15.7 7.1 5.5 4.7 20 18 14 0.0 0.0 0.0
ICICI Lombard Buy 9,950 1,510 (1) 1,780 18 26 32 24 57 47 62 11.2 9.2 7.0 - - - 13 15 9 0.0 0.0 0.0
SBI Life Buy 15,784 1,175 30 1,470 25 15 11 19 81 103 61 11.3 10.4 9.1 3.5 3.0 2.6 15 11 16 0.2 0.2 0.3
Chemicals & Fertilisers - - - 47 47 35 9.5 9.2 7.4 38 32 24 22 21 22 0.6 0.4 0.5
Anupam Rasayan Add 1,101 820 - 920 12 7 15 26 117 53 31 5.2 4.8 4.2 43 32 21 7 9 14 - 0.1 0.3
Clean Science & Technology Sell 2,880 2,019 - 1,800 (11) 19 22 29 108 90 70 39.7 27.6 19.8 82 68 51 45 36 33 0.0 - -
Coromandel Intl Buy 3,122 792 (3) 1,150 45 45 49 55 17 16 14 4.5 3.7 3.1 11 11 9 28 25 24 1.5 1.8 2.0
Fine Organic Add 1,358 3,298 31 3,500 6 39 56 87 84 59 38 13.8 11.7 9.4 50 40 27 18 22 27 0.1 0.4 0.6
Godrej Agrovet Reduce 1,566 607 13 660 9 16 22 27 38 27 23 5.7 4.9 4.2 23 18 15 16 19 20 0.7 0.8 1.0
Navin Fluorine Reduce 2,349 3,534 35 3,700 5 50 52 78 71 67 45 10.7 9.6 8.2 55 49 33 16 15 19 0.2 0.4 0.4
PI Industries Add 5,580 2,738 25 3,530 29 49 60 81 56 46 34 7.8 6.8 5.7 39 30 22 19 16 18 0.2 0.2 0.2
SRF Add 8,573 2,154 93 2,220 3 206 56 70 10 39 31 1.8 7.6 6.2 31 24 20 20 21 22 1.1 0.3 0.4
Sudarshan Chemical Buy 544 585 22 770 32 20 20 28 29 29 21 5.4 4.8 4.1 16 16 12 21 18 21 - 1.2 1.0
Sumitomo Chemical Add 2,553 381 30 415 9 7 7 10 55 52 36 12.3 10.2 8.2 38 36 26 25 21 25 0.2 0.2 0.3
Engineering # - - - 63 42 36 5.5 5.1 4.7 42 30 25 9 13 14 1.3 1.2 1.4
ABB Buy 6,306 2,215 83 2,230 1 12 21 28 178 107 79 13.0 12.4 11.4 121 73 55 7 12 15 0.2 0.5 0.6
Bharat Electronics Buy 7,315 224 86 242 8 8 10 11 26 22 20 5.0 4.5 4.0 15 13 12 20 22 22 1.8 2.1 2.4
BHEL Sell 3,050 65 82 26 (60) (8) (1) 1 - - 46 0.9 0.9 0.9 - - 25 (10) (2) 2 - - 0.4
L&T Buy 36,960 1,959 52 2,175 11 49 71 87 40 27 22 3.6 3.4 3.1 26 21 18 10 13 14 1.8 1.5 1.8
Siemens Sell 11,408 2,385 51 1,720 (28) 21 31 38 112 78 62 9.0 8.2 7.5 80 52 43 8 11 13 0.4 0.3 0.4
Continued…

Essence of the week
Weekly Note
FMCG - - - 70 65 52 22.4 21.1 19.4 47 44 36 35 33 37 1.6 1.7 1.9
Asian Paints Sell 40,238 3,123 13 2,550 (18) 33 29 41 95 106 77 23.4 22.6 20.1 61 69 51 27 22 28 0.6 0.6 0.8
Berger Paints Sell 10,365 794 5 625 (21) 7 9 11 107 92 69 22.8 20.0 17.2 65 58 45 24 23 27 0.4 0.5 0.6
Britannia Inds Reduce 11,928 3,687 3 3,700 0 77 67 77 48 55 48 25.0 36.8 29.1 36 40 35 47 54 67 2.6 2.3 1.4
Colgate Palmolive Add 5,574 1,526 (3) 1,750 15 37 38 43 41 40 35 35.6 42.8 52.9 27 27 24 73 96 134 2.5 2.9 3.3
Dabur Add 14,297 602 13 660 10 10 10 12 63 58 50 13.9 12.4 11.0 53 46 39 24 23 23 0.8 1.0 1.1
Emami Buy 3,332 558 31 660 18 15 16 18 37 34 31 14.1 14.9 14.4 28 26 23 37 42 48 1.4 2.5 2.9
Godrej Consumer Add 12,625 919 24 1,060 15 17 19 22 53 50 42 10.0 8.9 8.0 40 36 30 20 19 20 - 0.9 1.1
Hindustan Unilever Add 75,970 2,407 1 2,850 18 34 38 46 71 63 53 11.9 11.7 11.3 49 44 37 29 19 22 1.7 1.6 1.9
ITC Buy 38,585 233 12 290 24 11 12 14 22 19 16 4.9 4.7 4.6 18 14 12 21 25 28 4.6 4.7 5.4
Marico Reduce 9,489 547 36 520 (5) 9 10 11 61 55 50 21.8 20.2 18.8 44 39 35 37 38 39 1.4 1.5 1.6
Jyothy Labs Buy 783 159 8 190 20 6 5 7 27 32 23 4.1 4.0 3.8 18 21 16 16 13 17 2.5 2.8 3.2
Nestle Reduce 24,782 19,135 4 17,600 (8) 216 237 272 89 81 70 91.4 77.7 71.4 56 51 45 106 104 106 1.0 1.2 1.4
Pidilite Ind Reduce 16,557 2,426 37 2,250 (7) 22 26 35 109 93 70 22.0 19.0 15.8 73 62 47 23 22 25 0.4 0.4 0.4
Varun Beverages Buy 5,655 972 59 1,000 3 7 17 25 131 58 39 11.9 10.3 8.5 38 27 20 9 19 24 0.2 0.4 0.5
Ports & Logistics - - - - - - - - - - - - - - - - - -
Adani Ports & SEZ Reduce 20,574 750 55 785 5 21 28 39 36 26 19 5.0 4.0 3.5 23 16 12 15 17 19 1.0 1.2 1.6
Container Corp Reduce 5,620 687 72 540 (21) 12 17 23 58 40 29 4.3 4.6 5.0 34 25 19 7 11 16 2.6 3.8 5.1
Gateway Distriparks Buy 498 297 144 235 (21) 8 9 11 39 34 27 2.5 2.4 2.4 13 13 11 7 7 9 1.7 1.5 1.9
Mahindra Logistcs Add 707 732 77 570 (22) 4 12 23 163 59 32 9.2 8.2 6.9 38 21 14 6 15 23 0.3 0.3 0.6
Media - - - 18 18 22 3.8 4.6 3.9 19 14 10 1 (3) 19 0.6 1.9 2.2
Inox Leisure Buy 720 438 55 485 11 (30) (24) 11 - - 38 7.8 8.3 6.8 107 49 7 (53) (46) 20 - - -
P VR Buy 1,418 1,733 31 1,950 13 (123) (147) 52 - - 33 5.7 11.2 8.5 - - 7 (45) (65) 29 - - 0.2
Sun TV Add 2,982 563 17 590 5 38 39 44 15 15 13 3.1 3.0 2.9 9 8 7 24 21 23 0.9 4.8 5.4
Zee Ent Under Review 4,034 313 40 UR - 10 10 14 30 30 23 3.0 2.8 2.5 16 18 14 10 9 12 0.8 0.7 0.9
Oil & Gas - - - 23 19 17 4.5 3.9 3.3 14 12 10 22 23 23 2.8 2.9 2.8
Indraprastha Gas Buy 4,682 498 (1) 590 18 14 19 22 35 26 23 5.9 5.0 4.3 23 17 15 18 21 20 0.7 0.8 0.9
Petronet LNG Buy 4,773 237 (4) 280 18 20 20 23 12 12 11 3.1 2.8 2.4 6 6 5 26 24 25 4.9 5.0 4.8
Oil & Gas - OMC - - - 6 9 10 1.4 1.4 1.3 6 8 8 25 16 13 7.0 8.7 4.6
BPCL Add 12,460 428 21 460 8 59 37 38 7 12 11 1.7 1.9 1.7 7 9 8 29 15 16 4.6 14.7 4.9
HPCL Buy 6,606 347 59 355 2 75 44 43 5 8 8 1.4 1.3 1.2 5 8 8 33 17 15 6.6 5.1 4.9
Indian Oil Reduce 16,819 133 46 130 (2) 21 19 14 6 7 9 1.2 1.0 1.0 6 6 7 20 16 11 9.0 5.7 4.2
Continued…

Essence of the week
Weekly Note
Pharma/Healthcare - - - 89 37 30 6.6 5.7 4.9 26 21 17 16 16 17 0.5 0.4 0.4
Alembic Pharma Add 2,061 781 (24) 900 15 60 37 44 13 21 18 3.0 2.7 2.4 10 14 11 29 13 14 0.7 0.6 0.6
Alkem Labs Buy 5,704 3,551 22 4,200 18 130 138 157 27 26 23 5.8 4.9 4.2 22 19 17 23 21 20 0.8 0.8 0.8
Apollo Hospitals Add 9,018 4,669 94 4,800 3 6 49 64 748 95 73 14.6 12.7 10.8 60 33 27 2 14 16 0.0 0.0 0.0
Aster DM Healthcare Buy 1,394 208 25 220 6 3 6 8 70 32 26 3.1 2.8 2.5 12 10 9 4 9 10 - - -
Aurobindo Pharma Buy 5,415 688 (25) 800 16 54 50 58 13 14 12 1.8 1.7 1.5 7 8 7 16 13 13 0.4 0.4 0.4
Biocon Buy 5,593 347 (25) 400 15 5 6 10 70 55 35 5.5 5.0 4.6 26 22 17 8 9 14 - 0.2 0.2
Cadila Healthcare Add 6,771 492 3 570 16 20 21 22 24 24 23 3.9 3.5 3.2 17 16 15 18 15 15 1.0 1.0 1.2
Cipla Add 9,924 916 12 1,000 9 30 35 37 31 26 24 4.0 3.6 3.1 17 15 12 14 14 14 0.2 0.2 0.2
Divi's Lab Reduce 17,269 4,843 26 5,000 3 76 90 108 64 54 45 13.8 11.5 9.5 44 37 31 24 23 23 0.4 0.4 0.4
Dr Reddys Lab Buy 10,821 4,842 (7) 5,500 14 148 160 290 33 30 17 4.6 4.2 3.6 18 17 11 15 14 23 0.6 0.5 0.5
Eris Lifesciences Buy 1,427 782 35 950 22 26 29 33 30 27 23 6.7 5.7 4.8 24 21 18 25 23 22 0.7 0.8 0.9
Glenmark Pharma Add 1,985 524 6 640 22 33 36 39 16 15 13 2.1 1.7 1.6 9 8 7 14 13 12 0.5 0.5 0.5
IPCA Buy 3,784 2,221 1 2,500 13 88 85 97 25 26 23 5.9 4.9 4.1 18 17 15 26 21 20 0.4 0.4 0.4
Lupin Add 5,782 948 (3) 970 2 27 36 38 35 26 25 3.1 3.2 2.8 16 15 12 9 12 12 1.6 0.8 0.8
Natco Pharma Add 2,034 830 (14) 1,100 32 24 25 31 34 33 27 3.7 3.2 2.3 24 14 5 11 10 10 0.5 0.5 0.5
Sun Pharma Add 25,980 806 36 900 12 25 31 33 33 26 25 4.2 3.7 3.2 22 17 15 13 15 14 0.3 0.3 0.3
Syngene Intl Reduce 2,987 555 (13) 590 6 9 11 14 60 53 40 7.9 7.0 6.1 33 30 24 15 14 16 - 0.2 0.3
Torrent Pharma Buy 6,341 2,790 (0) 3,400 22 93 89 106 30 31 26 8.1 7.0 6.1 21 19 16 30 24 25 0.8 0.8 1.0
Power Utilities - - - 31 25 20 4.4 3.9 3.5 16 13 12 14 15 16 3.3 4.2 4.5
CESC Buy 1,612 91 47 120 33 10 11 12 9 9 8 1.2 1.1 1.1 7 7 6 14 14 14 5.0 5.3 5.8
Indian Energy Exchange Sell 3,191 793 248 542 (32) 7 12 13 111 68 59 44.5 36.9 30.8 91 54 47 46 59 57 0.5 1.0 1.2
JSW Energy Sell 7,130 323 376 116 (64) 5 6 6 69 58 50 3.7 3.5 3.4 20 22 21 6 6 7 0.5 0.5 0.5
NTPC Buy 17,747 136 37 180 32 14 15 16 10 9 8 1.1 1.0 1.0 10 8 7 12 12 12 4.5 4.3 4.8
Power Grid Reduce 17,054 182 28 190 4 19 20 20 10 9 9 1.8 1.7 1.6 8 7 7 19 19 19 5.4 8.6 9.0
Tata Power Add 10,299 240 217 240 0 4 5 8 60 47 30 3.4 3.5 3.3 17 15 12 6 7 11 0.6 0.6 1.0
Torrent Power Reduce 3,484 540 70 476 (12) 23 28 31 24 19 17 2.5 2.4 2.2 10 10 9 11 13 13 2.0 2.1 2.3
Real Estate # - - - - - - - - - - - - - - - - - -
Godrej Properties Sell 8,562 2,293 60 1,550 (32) (5) 2 1 - - - 10.0 9.9 9.9 - - - (3) 1 1 - - -
Oberoi Realty Sell 4,756 974 67 635 (35) 8 34 37 115 29 26 3.8 3.3 3.0 62 26 23 3 12 12 - - -
Macrotech Developers Sell 7,583 1,262 - 830 (34) 23 29 35 54 43 36 10.9 6.7 5.7 55 30 27 20 20 17 - - -
Continued…

Essence of the week
Weekly Note
Retail - - - 223 166 96 28.5 24.5 20.2 145 90 61 10 19 25 0.1 0.1 0.2
ABFRL Add 3,757 298 80 310 4 (7) (1) 5 - - 58 10.2 9.5 8.0 48 25 15 (34) (2) 15 - - -
Avenue Supermarts Sell 44,179 5,077 84 3,600 (29) 18 26 43 282 192 119 26.7 23.5 19.6 187 126 81 10 13 18 - - -
Bata India Add 3,720 2,155 36 2,200 2 (9) 11 42 - 192 51 15.7 15.0 12.0 165 58 26 (6) 8 26 0.2 0.2 0.4
Jubilant Foodworks Add 7,100 4,005 44 4,200 5 17 40 55 229 99 73 36.8 28.4 21.8 68 43 35 18 32 34 0.1 0.2 0.3
Kalyan Jewellers Buy 1,079 78 - 105 35 1 2 4 96 34 21 2.8 2.6 2.3 15 13 10 3 8 12 - - -
Page Industries Add 6,059 40,440 46 42,500 5 305 470 641 132 86 63 51.0 44.3 36.6 85 58 44 40 55 63 0.6 0.9 1.1
Shopper's Stop Add 557 379 90 355 (6) (23) (4) 2 - - 219 22.8 33.0 28.7 79 12 6 (159) (27) 14 - - -
Titan Inds Sell 30,279 2,539 62 1,800 (29) 11 23 29 225 110 86 30.0 25.0 20.6 128 71 57 14 25 26 0.2 0.2 0.3
Westlife Devlp Buy 1,221 584 28 675 16 (7) 0 11 - 2,022 55 18.9 18.7 14.0 194 43 22 (20) 1 29 - - -
Midcap - - - - - - - - - - - - - - - - - -
Havells India Reduce 11,547 1,373 50 1,180 (14) 17 20 24 83 69 57 16.6 14.1 11.9 55 46 38 22 22 23 0.5 0.4 0.4
Polycab India Add 5,042 2,516 143 2,550 1 59 59 79 43 43 32 7.9 6.7 5.6 31 28 21 20 17 19 0.4 0.2 0.3
Tube Invst Add 4,537 1,751 118 1,550 (12) 15 26 34 115 68 52 14.7 12.6 10.5 68 43 34 15 20 22 0.2 0.3 0.4
Voltas Reduce 5,618 1,264 53 1,130 (11) 16 18 25 79 70 51 8.4 7.7 6.9 60 52 39 11 11 14 0.4 0.4 0.5
Source: Axis Capital, Bloomberg
Note
1) EPS & BV are for core business while target price includes value of investments
2) # We are in process of re-initiating coverage
3) * For Piramal Enterprises Adj BV = BV
4) ^ Quarterly numbers being worked upon and hence valuation guide does not incorporate adjustments in numbers, if any

Essence of the week
Weekly Note
APPENDIX
Results Schedule – Q2FY22
Concall details Dial in nos.
13-Nov-21
Arvind Fashions
Dilip Buildcon
Dish Tv India
Ipca Laboratories
J.K.Cement
Repco Home Finance
Ujjivan Financial Services
Source: www.bseindia.com

Essence of the week
Weekly Note
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Essence of the week
Weekly Note
Axis Capital Limited

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BUY More than 15%
ADD Between 5% to 15%
REDUCE Between 5% to -10 %
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Essence of The Week: What Goes Down Must Come Up?

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ESSENCE OF THE WEEK

What goes down must come up?

November 12, 2021 India Weekly

15 FII Equity FII Debt

Market snapshot: Debt & Money mkt, Equity

Valuation guide .............................................. 27-32

Axis Capital Research Axis Capital Sales

EARNINGS & VALUATIONS

Key indices: Forward P/E

Nifty NSE Midcap 100

Axiscap universe: Sector earnings and valuations

Source: Axis Capital

November 12, 2021 2

EPS & TARGET PRICE CHANGES

November 12, 2021 3

AXIS CAPITAL: EARNINGS REVIEW Q2FY22

ABFRL Results expectations : Above

November 12, 2021 4

November 12, 2021 5

November 12, 2021 6

November 12, 2021 7

November 12, 2021 8

November 12, 2021 9

SUMMARIES OF REPORTS RELEASED THIS WEEK

(prithviraj.srinivas@axiscap.in; 91 22 4325 1108)

(prithviraj.srinivas@axiscap.in; 91 22 4325 1108)

November 12, 2021 10

(prithviraj.srinivas@axiscap.in; 91 22 4325 1108)

Services in expansion everywhere except COVID-impacted Russia

November 12, 2021 11

November 12, 2021 12

EVENT UPDATES RELEASED THIS WEEK

Pharma – Domestic formulations: October 2021 scorecard

November 12, 2021 13

IPM growth drivers

November 12, 2021 14

Source: AIOCD, % of FY21 sales

Remain selective; top picks

November 12, 2021 15

Source: Bloomberg, Companies, Axis Capital; Prices as on 3 rd November 2021

November 12, 2021 16

Debt & Money market

10-yr bond yield G-Sec yield curve

Source: Bloomberg Source: Bloomberg

Interest Rate Indicator 10yr-Gsec Yield

November 12, 2021 17

Major Nifty stock moves this week

Price and volume performance grid

UPL, Titan, Wipro

< (50) (25) 0 50 100 >

November 12, 2021 18

31 19 Bharti Airtel Ltd 6 (22) Divi's Laboratories Ltd (7) 193

November 12, 2021 19

FII net flows in Asian equities Nifty: 50 & 200 DMA

Volumes: 90 DMA Market delivery: 90 DMA NSE: Adv /Dec ratio

Source: Bloomberg, BSE, NSE, Axis Capital

Sectoral indices: 5-day performance ADR/GDR prices*

Source: Bloomberg * Data as on Thursday

November 12, 2021 20

Bulk deals (> Rs 100 mn traded value)

November 12, 2021 21

Stocks with highest open interest (value-wise)

Nifty FII flows vs Nifty open interest FII flows