India Equity Institutional Research | Retail Initial Public Offer

AVENUE SUPERMARTS Ltd. (DMART) INR 295-299

Lets the shopping begin SUBSCRIBE

Investment Rational - Key strength Date: March 2, 2017

Defined target consumer base: D-mart business model is based on the concept of
offering value retailing to the customers using the Every Day Low Cost/ Every Day Low
Price strategy which offers low prices on an everyday basis by achieving low Market Info:
procurement and operations cost. They believe in maintaining the relationship with
customers and target lower-middle, middle and aspiring upper-middle income SENSEX 28840
Consumers. They believe that these measures help them in recognized as one-stop
retail store chain for daily needs at value for money prices.
NIFTY 8900
Expansion with store acquisition strategy and ownership model: In recent
years Company has expanded its foot prints across eight states concentrated in
western and southern India, primarily through store network. It had opened its first IPO Price Band: INR 295-299
store in 2002 to 117 stores as on Dec 16. It has expanded footprint using a cluster-
based approach and have strengthened its presence in certain regions by opening new Date of
March 8th 2017
stores within a radius of a few kilometers of the existing stores and distribution Opening
centers. It has posted consistent growth in ROE despite owning the real estate
underlying several stores. Date of
March 10th 2017
Closing
High operating efficiency through stringent inventory management using IT
systems: D-Mart has benefitted because of in-depth understanding of local needs and Issue size INR 18700 Mn
its ability to respond quickly to changing consumer preferences. This has been only
achieved due to advanced IT systems which is been used for procurement, sales and No. of Shares
62.5 Mn–63.3 Mn
inventory management which enables to identify and react to changes The IT systems Offered
also support our cash management, in-store systems, logistics systems, human
resources and other administrative functions which run on ERP applications and are Bid Lot 50 shares
robust and scalable. Their supply chain management systems and also internal
controls help in to minimize product shortage and the occurrence of out-of-stock Source: RHP
situations and pilferage and are save from disruptions from their day to day
operations.
Analyst:
Strong promoter background and an experienced and entrepreneurial Nirvi Ashar
nirvi.ashar@krchoksey.com
management team: The business is consumer-driven with strong promoter
background and an experienced senior management team that have helped to offer  91-22-6696 5526
high standards of customer service and a pleasant shopping experience. One of the
Promoters is Mr. Radhakishan S. Damani, who has given in success to the Company by Dhavan Shah
dhavan.shah@krchoksey.com
his vision and leadership. The promoter is supported with experienced management
team, motivated and well-trained employees who have establish a customer-oriented  91-22-6696 5574
corporate culture, providing a foundation to maintain and enhance our long-term
competitiveness. With in-depth understanding of the retail business in India and local www.krchoksey.com
consumer preferences company has been growing with revenue growth of 40% CAGR  91-22-6696 5555
growth.
 91-22-6691 9569
Outlook and Valuation: Avenue Super marts are considered as one of the most
prominent player in the F&G market with a presence among 41 cities. The company
has total 117 stores as on Dec’16 with a large revenue penetration from Maharashtra
(~63% of rev in FY16) followed by Gujarat (~19% of rev), Telangana (~10% of rev)
etc. We believe that although the company has been following different business model
such as ownership (higher capex against lease model) vis-à-vis rental by other large
players like Future retail and Trent, the key ratios such as average ROE & ROCE has
been lingering higher at ~15% & ~10% between FY12-16 against industry average of
~7% & ~5% respectively. Further, the company has total debt of Rs.12.4bn at the end
of 9MFY17, which is expected to reduce by Rs. 10.8bn over FY18-20. This in turn could
result company to stand at almost debt free level, which could improve return ratios
further going ahead. Apart from this, we believe that company has also witnessed a
decent growth in terms of sales per store (CAGR: ~18%) and sales per sq feet (CAGR:
~16%) over the period of FY12-16. Any further progress in terms of store addition and
increase in more penetration among existing market could result in strong revenue
growth over medium to long term. Despite the management has indicated gross
margins to be at ~15%, while OPM & NPM to remain at ~8-9% & 4-5% respectively,
we expect that any further progress for augmenting the revenue share from General
Merchandise & Apparel segment (~28% of overall rev during 9MFY17) could aid
further margins, which in turn could result in improvement in the financial performance
further.
KRChoksey Institutional Research is also available on Bloomberg KRCS<GO>, Thomson Reuters, Factset and Capital IQ March 02, 2017
AVENUE SUPERMARTS Ltd.

In terms of the valuations, on the upper price band of Rs. 299, the stock is valued at 32.5x on FY17 basis (annualized
9MFY17 EPS of Rs. 6.90). We believe that stock is valued at reasonable valuations given the listed peers such as Future
retail and Trent trading at ~37x FY17 & ~50x FY17 respectively. Further, strong financial performance (Topline CAGR 40%
against industry Avg.CAGR: ~10-15%, Avg.OPM: 7.3% against industry average: ~5-7% and Bottom-line CAGR 52% over
the period FY12-16) could also provide more opportunities to demand higher valuations in the coming time. Further, an
increase in the penetration among different Tier 2 & Tier 3 cities in the years to come could assist them to capture potential
market share and provides strong financial performance visibility going ahead. For the same reason, we have a
SUBSCRIBE rating on the issue.

Use Of IPO Proceeds

Particulars INR in Mn
Repayment or prepayment of a portion of loans and redemption or earlier redemption of
10,800.00
NCDs availed by our Company
Construction and purchase of fit outs for new stores 3,666.00

General corporate purposes 4,234.00

Net proceeds 18,700.00

Source: KRChoksey research, RHP

Particulars FY18 FY19 FY20

Repayment or prepayment of a portion of loans and redemption or
6,250.00 3,200.00 1,350.00
earlier redemption of NCDs availed by our Company
Construction and purchase of fit outs for new stores 799.74 1433.13 1433.13
Source: KRChoksey research, RHP

Public Issue
Particulars %

QIP 50%
Non-Institution 15%
Retail 35%
Total 100%
Source: KRChoksey research, RHP

Share Holding Pattern (%)

Particulars Pre Issue Post Issue

Promoters Group 91.34 81.34

Directors & Others 8.66 18.66

Industry Overview:
India is one of the key consumer markets from where future growth is likely to emerge and it is estimated that India‘s
consumption expenditure will increase to USD 2,000bn by 2020. It is expected that India will rank among top 5 economies
and will surpass the consumption expenditure of developed economies like Italy, France and United Kingdom by 2030. House
hold consumption accounts for 60% of India’s GDP which is much higher share than China (37%) and on similar lines with UK
and US at 65% and 68%, respectively.
Contribution
Country 2008 2009 2010 2011 2012 2013 2014 2015 2020P
to GDP
UK 1,792 1,498 1,553 1,672 1,710 1,763 1,933 1,847 1,665 69%
U.S. 10,014 9,847 10,202 10,689 11,050 11,392 11,865 12,271 13,913 68%
Brazil 1,012 1,032 1,330 1,575 1,510 1,519 1,507 1,124 2,350 63%
Italy 1,424 1,325 1,296 1,400 1,276 1,302 1,312 1,108 1,143 63%
India 424 485 553 651 760 877 1,011 1,125 2,000 58%
Germany 2,075 1,963 1,915 2,078 1,970 2,074 2,112 1,813 2,108 57%
Indonesia 309 317 424 494 517 518 509 491 909 56%
France 1,615 1,514 1,486 1,596 1,492 1,560 1,572 1,332 1,470 55%
Thailand 156 149 177 196 209 218 211 - 339 55%
Malaysia 103 99 122 143 156 167 177 160 295 51%
China 1,608 1,809 2,079 2,615 3,019 3,424 3,954 - 10,024 36%
Source: World Bank, Technopak Research & Analysis
2 KRChoksey - Institutional Research
AVENUE SUPERMARTS Ltd.

Increasing Urbanization: Urbanization began after India was independent. Also factors such as better standard of living,
education opportunities etc lead people to migrate to towns and cities. The growth of industries contributed to the growth of
cities leading to a migration of people towards industrial areas in search of employment opportunities.

Source: KRChoksey research, RHP

Young Demographics and Reducing Dependency Ratio: India is a country with Young population where 65% of the
population is below 35 years of age and approximately 78% of the population is below 45 years of age. Compared to other
top 10 economies (including China), India has the lowest median age and this trend will be even more pronounced in next 2
decades as most other populations age. This young generation is more aspiration, well-connected & networked, tech-savvy,
mobile and has high spending power. This young population with rising incomes will have a significant impact on retailing and
consumption of many categories and products as this class will be consuming a greater number of lifestyle categories than
their parents.

Retails Consumption Trends in India: The food and groceries (F&G) segment constitutes a majority share of the retail
market (67%). F&G will continue to be the largest contributor in the retail market even four years hence with a projected
share of 66% in 2020. 16 Indian states contribute approximately 85% of the total retail spend and are expected to continue
to have a significant share of the total retail consumption. Retail opportunity in three southern states – Karnataka, Andhra
Pradesh and Telangana is currently approximately USD100bn.

Categories 2012 2016 2020

Total Retail (US$ bn) 386 616 960
Food & Grocery 67.50% 67.00% 66.00%
Apparel & Accessories 8.25% 8.00% 7.75%
Footwear 1.15% 1.18% 1.20%
Jewelry & Watches 7.30% 7.60% 8.05%
Pharmacy & Wellness 2.80% 2.90% 2.95%
Consumer Electronics 5.20% 5.70% 6.60%
Home & Living 4.15% 4.30% 4.35%
Others 3.60% 3.30% 3.10%
Total 100% 100% 100%
Source: KRChoksey research, RHP

States Retail Spending 2012 Retail Spending 2016

Maharashtra 65 94
UP 30 44
AP 32 25
Telangana - 24
Tamil Nadu 32 49
West Bengal 20 29
Gujrat 26 39
Karnataka 24 40
Rajasthan 18 26
Kerala 16 23
MP 12 19
Delhi 16 26
Haryana 14 23
Bihar 8 16
Punjab 11 16
Orissa 7 11
Total 331 505
Source: KRChoksey research, RHP

3 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.

Penetration in Organized Retail:

Footwear has the highest share in terms of penetration achieved by organized retail at 40% whereas food and grocery is the
least penetrated with 3% organized share and which is projected to drive the growth of the share of organized retail within
the total retail market over the next few years.
Organized
% of
Share of Retail Market
FY16 (US$ bn) Organized Key Retailers
Retail Size Sized
retail
(US$ bn)
Food & Grocery 67.0% 413.0 3.0% 13.0 DMart, Reliance Fresh, More, Big Bazar
Apparel & Accessories 8.0% 49.3 22.0% 10.9 Shoppers Stop, Lifestyle, Westwide
Jewelry & Watches 7.6% 46.8 27.0% 12.7 Kalyan Jewellers, Tanishq, Malabar
CDIT 5.7% 35.0 25.0% 8.8 Croma, Riliance Digital, eZone
Home & Living 4.3% 26.5 10.0% 2.7 Home Centre, Home Stop, Home Town
Pharmacy & Wellness 2.9% 17.8 10.0% 1.8 Apollo, MedPlus
Footwear 1.8% 7.4 40.0% 3.0 Bata India, Metro Shoes, Adidas
Others 1.2% 20.3 12.0% 2.5 -
Total 100% 616.0 100% 55.0
Source: KRChoksey research, RHP

In 2020, the F&G segment is projected to witness the current pace of robust growth and reach a 5% share of organized retail
penetration.
Categories 2012 2016 20120
Total Organized Retail (US$ Bn) 27 55 115
Food & Grocery 1.5% 3.0% 5.0%
Apparel & Accessories 20.0% 22.0% 32.5%
Jewelry & Watches 38.0% 40.0% 43.5%
CDIT 26.0% 27.0% 30.0%
Home & Living 8.0% 10.0% 12.0%
Pharmacy & Wellness 23.0% 25.0% 32.0%
Footwear 8.0% 10.0% 12.0%
Others 10.0% 12.0% 14.0%
Source: KRChoksey research, RHP

Business Overview and company Background:

Avenue super mart (D-Mart) was incorporated in 2000 by our promoter Mr. Radhakishan Damani. D-Mart is an emerging
national supermarket chain, with a focus on value-retailing. According to Technopak, in Fiscal 2016, Company is one of the
largest and the most profitable F&G retailer in India. They offer wide range of products with a focus on the Foods, Non-Foods
(FMCG) and General Merchandise & Apparel product categories.

Source: KRChoksey research, RHP

4 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.
Business for them is to stock goods with quality and competitive price as the consumers buy products of everyday use. The
store provides customer with distinct shopping experience in a modern ambience and with the feel of a large retail mall. It
assists convenience in a form of one stop shop for customers. Their strength lies in value retail products at competitive price,
careful product assortment and supply efficiencies.

Revenue contribution for the segments:

Particulars FY14 FY15 FY16 9MFY17
Foods 53.3% 52.8% 53.1% 52.8%
Non-Foods 21.5% 21.2% 20.6% 19.6%
General Merchandise & Apparel 25.2% 25.9% 26.4% 27.6%
Source: KRChoksey research, RHP

It operates and managed all the stores on an ownership model (if any that are on lease for 30 years). The focus for opening
stores remains on efficient supply chain, targeting densely-populated residential areas with a majority of lower-middle,
middle and aspiring upper-middle class consumers. Its first store was opened in Mumbai, Maharashtra in 2002 and they plan
reach store network in southern and western India and gradually expand our network in other parts of India as an expansion
strategy. Currently our network includes

States FY12 FY13 FY14 FY15 FY16 9MFY17

Maharashtra 34 40 46 50 58 59
Gujarat 14 14 17 22 26 27
Telangana 4 5 7 9 13 13
Karnataka 3 3 5 5 6 7
Andhra Pradesh - - - 1 3 4
Madhya Pradesh - - - 1 3 3
Chhattisgarh - - - 1 1 1
NCR - - - - - 1
Daman - - - - - 1
Rajasthan - - - - - 1
Total 55 62 75 89 110 117
Source: KRChoksey research, RHP

Parameter FY12 FY13 FY14 FY15 FY16 9MFY17

New stores opened in Fiscal/period 10 7 13 14 21 7
Cumulative number of stores 55 62 75 89 110 117
Retail business Area (in Mn sq.ft.) 1.55 1.76 2.14 2.66 3.33 3.57
Revenue from Sales per Retail Business Area sq.ft.
15,324 20,116 23,419 26,388 28,136 25,161
(in INR)
Source: KRChoksey research, RHP

5 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.
D-Mart Presence in India:

Source: KRChoksey research, RHP

Peers:
Comparison is done between players belonging to Hypermarkets, supermarkets and regional players on basis of sales per
sqft, number of stores, average Store size per sqft and revenue of Key Players

Average sales per sq. ft. of key players

Hypermarkets Supermarkets Regional Players
Sales per sqft/ Sales per sqft/ Sales per sqft/ Sales per sqft/ Sales per sqft/
Sales per sqft/
Players Annum INR Annum INR Players Annum INR Players Annum INR Annum INR
Annum INR 2012
2012 2016 2016 2012 2016
Reliance Mart 5000-6000 8500-9500 D Mart 12000-12500 28000-30000
Star Bazaar 6500-7500 11000-13000 Reliance Fresh 9000-10000 17500-18500
Big Bazaar 5500-6500 9500-10500 Food Bazaar 7500-8500 15000-15500
Regional Players 8500-9500 17000-17500
Spencer Hypermarket 6000-7000 16000-17000 Spencer Hypermarket 7000-8000 17500-18500
More Megastore 4500-5500 8500-9500 More Megastore 5000-6000 8000-9000
Hypercity 5000-6000 7000-8000 Hypercity 7500-8500 15000-16000
Source: KRChoksey research, RHP

6 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.

Store Foot print of key retailers in India:

Number of Stores Number of Stores Presence across
Group Brands Format Presence
March 2012 March 2016 No. of Cities
Future Group Big Bazaar Hypermarket National 138 500
EasyDay Hyper Hypermarket National 1 15
200+
Bharti Group Supermarket/
EasyDay National 188 188
Convenience store

Reliance Mart &Reliance Super Hypermarket National 18 60

Reliance 200+
Reliance Fresh Supermarket/ National 453 597
Conveniance store

More Megastore Hypermarket National 13 19

Aditya Birla
170
Retail More Supermarket/ National 478 487
Conveniance store

Emerging
Star Bazar Hypermarket 7 10
National

Trent/Tata Star Market Supermarket/ Emerging NA 5

5
Group Conveniance store National

Star Daily Supermarket/ Emerging NA 11

Conveniance store National

Spencer's
Hypermarket National NA 37
Hypermarket
CESE Limited 24
Spencer's Supermarket/ National NA 84
Hypermarket Conveniance store

Emerging
K Raheja Corp Hypercity Hypermarket 10 17 5
National

Avenue Emerging
D'Mart Supermarket 55 110 39
Supermarkets National
Source: KRChoksey research, RHP

Average store size:

Hypermarkets Supermarkets Regional Players
Average Area Average Area Average Area per Average Area Average Area Average Area
Players per store (Sq per store (Sq Players per store (Sq Players per store (Sq per store (Sq
store (Sq ft.) 2012
ft.) 2012 ft.) 2016 ft.) 2016 ft.) 2012 ft.) 2016
Reliance Mart 70000-100000 40000-45000 D Mart 28000-32000 28000-32000
Star Bazaar 55000-65000 45000-55000 Reliance Fresh 3000-5000 3000-4000
Big Bazaar 45000-50000 43000-45000 Food Bazaar 16000-18000 16000-17000
Regional Players 2000-3000 2000-3000
Spencer Hypermarket 40000-50000 22000-25000 Spencer Hypermarket 3500-4500 2750-3000
More Megastore 70000-80000 40000-45000 More Megastore 2000-5000 2000-2500
Hypercity 90000-100000 75000-85000
Source: KRChoksey research, RHP

7 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.

Revenue of key retailers in India:

Revenue (INR Revenue (INR

Group Brands Format Presence Cr.) Cr.)
FY 2012 FY 2016
Future Group Big Bazaar Hypermarket National 4400
KB's Conveniently Supermarket/
KB's National 170
Yours Convenience Store
Supermarket/
Nilgiri's Nilgiri's Regional 115 11000
Convenience Store
EasyDay Hyper Hypermarket National
Bharti Group Supermarket/ 510
EasyDay National
Convenience Store

Reliance Mart &

Hypermarket National
Reliance Super
Reliance 2600 6650
Supermarket/
Reliance Fresh National
Convenience Store

More Megastore Hypermarket National

Aditya Birla Retail Supermarket/ 1400 1850
More National
Convenience Store

Spencer's
Hypermarket National
Hypermarket
CESE Limited 1200 1850
Spencer's Supermarket/
National
Supermarket Convenience Store

K Raheja Corp Hypercity Hypermarket Emerging National 500 1025

Avenue Hybrid
D'Mart Emerging National 2350 8650
Supermarkets Supermarket
Source: KRChoksey research, RHP

Financials

Profit & loss Statement:

Particulars FY12 FY13 FY14 FY15 FY16 9MFY17
Revenue 22,085.6 33,408.5 46,864.9 64,394.3 85,881.2 87840.0
Other Income 138.5 142.5 158.4 182.6 179.9 192.0
Total Revenue 22,224.1 33,551.0 47,023.3 64,576.9 86,061.1 88032.0
Expenses
Purchase of stock-in-trade 19,567.7 29,379.3 40,865.3 56,484.7 74,398.5 75916.0
Changes in inventory of stock in trade -728.1 -804.9 -1,021.0 -1,612.8 -1,320.8 -1760.0
Employee benefit expenses 453.1 686.7 873.4 1,340.6 1,486.1 1376.0
Other Operational Costs 836.5 1,274.0 1,810.6 2,334.0 3,086.2 3121.0
Other expenses 576.1 723.5 918.9 1,257.9 1,596.4 1491.0
Total Expense 20,705.3 31,258.5 43,447.1 59,804.4 79,246.4 80144.0
EBIDTA 1,518.8 2,292.6 3,576.1 4,772.5 6,814.7 7888.0
EBIDTA Margin % 6.8% 6.8% 7.6% 7.4% 7.9% 9.0%
Depreciation and amortisation 374.7 457.9 570.1 815.4 984.3 919.0
EBIT 1,144.1 1,834.7 3,006.0 3,957.1 5,830.4 6969.0
Finance Costs 260.2 425.9 556.8 723.6 908.2 907.0
PBT 883.9 1,408.9 2,449.2 3,233.5 4,922.2 6066.0
Tax Expense 282.4 472.0 835.0 1,109.2 1,716.2 2133.0
Net Profit 601.6 936.9 1,614.3 2,124.3 3,206.0 3929.0
PAT Margin % 2.7% 2.8% 3.4% 3.3% 3.7% 4.5%
Source: KRChoksey research, RHP

8 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.

Balance Sheet:
Particulars FY12 FY13 FY14 FY15 FY16 9MFY17
Share capital 5,335.4 5,440.6 5,467.5 5,615.4 5,615.4 5,615.4
Reserves and surplus 1,481.6 2,454.9 4,088.3 6,376.8 9,588.8 13439.0
Minority Interest 3.0 3.0 0.1 0.5 1.0 1.0
Non-current liabilities
Long-term borrowings 2,643.2 3,711.6 4,568.4 7,137.8 9,084.7 12277.0
Deferred tax liabilities (Net) 129.7 201.0 265.1 305.1 398.7 476.0
Other long term liabilities 113.4 133.9 124.4 160.8 161.7 12.0
Long Term Provisions 0.1 0.4 0.8 1.3 1.7 1.7
Current liabilities
Short-term borrowings 633.3 623.7 546.6 436.9 1,297.0 144.0
Trade payables 643.7 943.9 1,225.9 1,185.1 1,918.3 2375.0
Other current liabilities 897.7 1,346.0 1,701.3 2,150.3 2,770.0 2937.0
Short-term provisions 27.7 61.9 88.0 178.1 164.6 398.0
Total 11,908.8 14,920.7 18,076.5 23,548.1 31,001.9 37678.0
Assets
Tangible assets 7,772.9 9,215.8 11,680.7 15,240.9 20,891.8 23227.0
Intangible assets 17.7 30.8 36.2 39.9 43.4 69.0
Capital Work-in-progress 849.4 1,181.1 887.8 981.2 816.9 2055.0
Total Fixed Assets 8,640.0 10,427.7 12,604.7 16,262.0 21,752.0 25352.0
Non Current Investments 137.6 159.5 152.4 145.6 274.8 424.0
Long term loans and advances 355.3 526.2 425.8 801.6 1,073.6 1071.0
Other Non Current Assets 0.0 0.1 0.1 2.1 3.0 7.0
Current assets
Current Investments 89.2 0.1 3.0 6.7 18.6 168.0
Inventories 1,957.4 2,762.3 3,783.3 5,396.1 6,716.9 8477.0
Trade receivables 56.3 132.9 95.4 70.7 84.2 405.0
Cash and bank balances 479.2 616.2 554.1 380.4 351.0 494.0
Short-term loans and advances 179.9 294.7 454.8 481.4 723.9 1273.0
Other current assets 14.0 1.1 2.9 1.5 4.1 7.0
Total 11,908.8 14,920.7 18,076.5 23,548.1 31,001.9 37678.0
Source: KRChoksey research, RHP

Cash Flow
Particulars FY12 FY13 FY14 FY15 FY16 9MFY17
PBT 887.3 1411.4 2448.5 3226.5 4929.0 6066.0
Net cash from Operating Activities 653.6 1270.9 1981.4 2220.2 4471.4 3781.0
Net Cash from Investing Activities -1289.2 -2308.9 -2701.7 -4738.8 -6583.4 -4971.0
Net Cash from in Financing Activities 934.9 1175.4 652.3 2344.5 2081.8 1333.0
Net increase/(decrease) in Cash 299.4 137.4 -68 -174.1 -30.2 142.0
Source: KRChoksey research, RHP

9 KRChoksey - Institutional Research

AVENUE SUPERMARTS Ltd.
ANALYST CERTIFICATION:

We, Nirvi Ashar (B.com, MBA), and Dhavan Shah (B.com, MBA) research analyst, author and the name subscribed to this report, hereby certify that all of the views expressed in this
research report accurately reflect my views about the subject issuer(s) or securities. I also certify that no part of our compensation was, is, or will be directly or indirectly related to the
specific recommendation(s) or view(s) in this report.

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dealers and other professionals may provide oral or written market commentary or trading strategies that reflect opinions that are contrary to the opinions expressed herein, .In reviewing
these materials, you should be aware that any or all of the foregoing, among other things, may give rise to real or potential conflicts of interest.

Associates (Group Companies) of KRCSSPL might have received any commission/compensation from the companies mentioned in the report during the period preceding twelve months from
the date of this report for services in respect of brokerage services or specific transaction or for products and services other than brokerage services.

KRCSSPL or its Associates (Group Companies) have not managed or co-managed public offering of securities for the subject company in the past twelve months

KRCSSPL encourages the practice of giving independent opinion in research report preparation by the analyst and thus strives to minimize the conflict in preparation of research report.
KRCSSPL or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report.
Accordingly, neither KRCSSPL nor Research Analysts have any material conflict of interest at the time of publication of this report.

It is confirmed that, Nirvi Ashar (B.com, MBA), and Dhavan Shah (B.com, MBA) research analyst, of this report have not received any compensation from the companies mentioned in the
report in the preceding twelve months. Compensation of our Research Analysts is not based on any specific brokerage service transactions.

KRCSSPL or its associates (Group Companies) collectively or its research analyst do not hold any financial interest/beneficial ownership of more than 1% (at the end of the month
immediately preceding the date of publication of the research report) in the company covered by Analyst, and has not been engaged in market making activity of the company covered by
research analyst.

Since associates (Group Companies) of KRCSSPL are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies
including the subject company/companies mentioned in this report.

It is confirmed that, Nirvi Ashar (B.com, MBA), and Dhavan Shah (B.com, MBA) research analyst, do not serve as an officer, director or employee of the companies mentioned in the 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 KRCSSPL and affiliates 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 certain category of investors. Persons in whose possession this document may come
are required to inform themselves of and to observe such restriction.

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