Equity Research

June 8, 2014
BSE Sensex: 26523

INDIA

Financials (non banks)

Get that shopping bag ready
Reason for report: India NBFC Sector update

Top Picks
IDFC
Rural Electrification Corp
HDFC
LIC Housing Finance
Power Finance Corp

Santanu Chakrabarti
santanu.chakrabarti@icicisecurities.com
+91 22 6637 7351

Yash Modi
yash.modi@icicisecurities.com
+91 22 6637 7314

Fears of a muted monsoon putting upward pressure on the CPI print while also
playing spoilsport to economic recovery hopes, has weighed heavy on the NBFC
sector stock prices. Our coverage universe has corrected 24.3% on an average
from their 52 week highs. With RBIs latest policy statement seen as clear
communication of a long pause on rate cuts, investors see risks to the earlier
thesis of easy money stimulating margin expansion and creating an enabling
environment for asset growth. Precious little progress has happened on large
infra projects and frustrations remain around the absence of meaningful green
shoots in key lead indicators of industrial activity (freight volumes etc.). Ever
since mid CY14, (see Hope stands on three shaky legs from 27th August, 2014
and Wheres my delta? exactly one year ago) we had been highlighting that
sector valuations had touched levels which built in a full recovery and then some!
Today, however, we feel really positive about most stocks in the space apart from
the ones directly linked to farm incomes. The above mentioned macro worries
and a weak earnings print in Q4FY15 has ensured that valuation levels are rather
attractive. Crucially, they allow the investor s with the luxury of waiting another
12-15 months for a recovery and still compound their investment at a decent
pace. We do not know when the recovery starts in earnest but draw confidence
from the following facts. Firstly, a pause in rate cuts has not hardened the bond
markets and margin expansion story will continue to play out, albeit slower.
Secondly, given the prolonged pressures on asset quality, most balance sheets
are designed for resilience and remain ready for acceleration, once the cycle
turns. Our shopping list in order of preference consists of IDFC, REC, HDFC, LIC
Housing Finance, PFC (little lower on the pecking order due to a near term event
risk). Despite the CE fiasco in its subsidiary, Shriram Transport Finance is
offering favourable risk-reward at CMP in our opinion. We would ask people to
stay cautious on M&M Financials and GRUH Finance, despite recent correction.
Infra bets are on! It may seem surprising to investors that infra finance names are
featuring in our top BUY ideas despite precious little positive news flow on the two
major issues gas and coal. However, our picks find themselves in pretty unique
situations that provide relative insulation to their balance sheets. REC, has 82.5% of
its lending made to non-private entities and has already restructured 15.2% of its
private exposure. IDFC is provided to the tune of 4.5% of loan assets against a
GNPA level of only 65bps. More importantly 7.8% of assets are already
restructured. We feel that the bad bank has been practically ring fenced so that
asset quality hiccups would have little bearing on earnings FY16 onwards .
Rural and farm income related exposure vulnerable. In companies which are
geared to the rural income and wealth levels of India, asset quality pressures and
lack of growth opportunities is likely to show up. This being likely the second
consecutive sub-par monsoon makes the situation dire for such players. MMFS is
very directly linked to rural prosperity and we feel that its GNPA levels could
potentially increase by a further 200bps to touch 9%, if the widely expected below
normal monsoon materializes. GRUH Finance asset quality vulnerability is lower.
Impact, if any, could be on asset growth. Our reservations here centre on valuation.
Valuation summary
Price
P/BV (x)
RoE (%)
(Rs)
Reco
FY15
FY16E
FY17E
FY15
FY16E
HDFC
1,177
BUY
6.1
5.5
4.9
20.0
21.3
LIC Housing
403
BUY
2.6
2.0
1.7
18.0
20.3
GRUH Finance
227
REDUCE
11.0
8.7
7.0
30.9
33.1
Dew an Housing
395
BUY
1.2
1.1
0.9
15.1
16.5
IDFC
146
BUY
1.4
1.3
na
10.6
9.6
Shriram Transport
815
HOLD
2.0
1.7
1.5
11.5
16.2
Shriram City Union
1,647
REDUCE
2.6
2.2
1.9
15.9
15.6
Mahindra Finance
248
HOLD
2.4
2.1
1.8
16.5
17.7
Muthoot Finance
188
BUY
1.5
1.3
1.2
14.3
15.7
Pow er Finance
260
BUY
1.1
0.9
0.8
19.5
18.6
Rural Electrification
283
BUY
1.1
0.9
0.8
24.1
23.7
Source: Bloomberg, I-Sec research
Please refer to im portant disclosures at the end of this report

FY17E
22.5
20.9
32.2
18.2
na
18.8
17.2
20.3
16.4
18.6
23.7

ICICI Securities

NBFCs, June 8, 2015

Chart 1: On a YoY basis rates have softened across maturities (June 2015 vs
June 2014)recent hardening is only about 15bps
9.4

AAA (1 year ago)

9.2
9.0

(%)

8.8

AAA (now)

8.6

8.4
8.2

G-sec (1 year ago)

8.0

G-sec (now)

7.8

1 yr

3yr

5yr

10yr

Source: Bloomberg

Table 1: NBFC Price Performance

Com pany name
Housing Development Finance Co.
LIC Housing Finance
Gruh Finance
Dew an Housing Finance
IDFC
Shriram Transport Finance
Shriram City Union Finance
Mahindra & Mahindra Financial
Muthoot Finance Ltd
Pow er Finance Corp Ltd
Rural Electrification Corp Ltd
Source: Bloomberg

Price
(Rs)
1,177
403
227
395
146
815
1,647
248
188
260
283

1M
(0.6)
(3.3)
(5.9)
(7.6)
(8.7)
2.7
(7.8)
(8.5)
6.1
1.5
(5.2)

3M
(15.6)
(18.8)
(11.3)
(29.5)
(18.2)
(31.6)
(17.5)
(3.7)
(13.7)
(11.5)
(19.6)

Returns (%)
6M
6.3
(8.3)
(9.1)
(0.2)
(7.6)
(31.1)
(2.2)
(22.2)
(3.5)
(11.1)
(12.3)

12M vs 52w high

25.9
(15.6)
16.1
(19.0)
15.0
(27.1)
10.7
(29.6)
7.2
(20.6)
(17.3)
(35.5)
8.2
(23.4)
(22.1)
(26.0)
(5.5)
(20.6)
(19.6)
(23.7)
(20.3)
(25.9)

The shopping list

IDFC (IDFC IN, BUY, 12M TP Rs235, CMP- Rs146)

The regulation allowing the raising of PSL and SLR/CRR exempt infrastructure
bonds addresses most of the bank transition pain points (to the extent that
the special infra bonds can be raised) and provides incentive for faster asset
growth accentuating the leverage play (both financial and operating).

As it will likely remain a largely wholesale bank in terms of both assets and
liabilities, the chief benefit of bank conversion is increased financial
leverage.

We assume the bank to have Rs140bn net worth in FY16 end (i.e. about Rs50bn
retained in the holding company). We are probably erring on the side of caution.

Our calculations suggested that a steady state RoE of ~20% vs 15.3%

possible now (core) with no beneficial assumptions on retail diversification,
priority sector requirements, and sourcing of low cost deposits. This was
despite a conservative interpretation of new regulations and assumption of only
partial utilization of new bond limits. Actual numbers could be significantly higher.

ICICI Securities

NBFCs, June 8, 2015

-

Conversion should also reduce cost of equity significantly. Trading at an

attractive 1.1xFY16E core P/B valuation now. Final valuations of bank likely to
be north of 2x (given new CoE/RoE). We use a target multiple of 2.1x on the
lending business (bank) and apply a 10% holding company discount to arrive at a
target price of Rs235. In our SOTP based target price, we assign 1xBVPS to any
fallow capital stuck in the NOFHC.

Asset quality risks contained by prudent provisioning, regulatory forbearance

and early cycle risk aversion.

REC (REC IN, BUY, 12M TP Rs475, CMP - Rs283)

-

Our asset quality scenario analysis rules out risks of major earnings
disruption. Cash flow and accrual analytics put at bay any fears of a severe
crunch in repayment cash flow from borrowers ever-greening fears look
exaggerated.

With restructuring provisioning norms having become applicable (with significant

relaxations) from March 31st, 2015, credit costs are likely to remain elevated.

One of the finest borrowers in the wholesale debt markets with access to
subsidised instruments like tax free & infrastructure bonds. Allowed to raise capital
gains bonds (6% cost!)

With RBIs notification allowing banks to raise long term bonds for infrastructure
project finance with zero regulatory costs, we have built in a significant yield
contraction due to increased competition. We have not given it an equivalent
benefit of wholesale easing thereby building a margin squeeze.

Modifying RoEs, to adjust for earlier low provisioning, trims them by 90 -210bps
and shows up sustainable peer-comparable RoE at ~20% going forward (despite
our assumptions).

We recommend BUYing for a 12 month price target of Rs475. Our target multiple
is 1.3x P/BVPS (on Dec-2016), factoring in tail risks. Dividend sustainability (3.7%
FY15 yield, ~20% CAGR over last 5 years) is also a key comfort factor.

HDFC (HDFC IN, BUY, 12M TP Rs1500, CMP - Rs1177)

-

Sector bellwether that has legitimised the NBFC model. Still has high growth
headroom despite size .

Low asset quality cyclicality but not as low as commonly perceived (developer
exposure). In non-individual business 6.9% QoQ growth coming in Q4FY15
seems to be the first signs of recovery in that space

Price leader (non-bank) and low cost wholesale borrower. Margins maintained
through hard rate cycle, easing would not have disproportionately benefited.
Therefore, impact of rate cycle disappointment is lower.

Affordable bond raising exemptions for banks not a serious competitive

threat, bank base rates and mortgage rates are neck and neck.

Tier 1 stood at 12.3% and reduced 420bps QoQ due to deduction of entire hold ing
in HDFC Bank from shareholders funds for purposes of regulatory capital
calculation. Without this adjustment, it would have stood at 15.3%. Leverage
headroom can play out through a one-time dividend or accelerated growth on the
developer loan book, as the tide turns

ICICI Securities

NBFCs, June 8, 2015

-

Merger possibilities with HDFC Bank to be clearly guided by eventual size of

affordable housing bond market. Not likely in a hurry.

Core valuations at 3.7x1-yr fwd core BVPS are justified given 30%+core RoE

LIC Housing Finance (LICHF IN, BUY, 12M TP Rs525, CMP - Rs403)
-

We feel that with i) better incremental loan pricing discipline, ii) benefits from
conversion into floating rates of earlier very low priced fixed rate loans and
iii) smarter liability management riding on the tailwind in the wholesale
borrowing market, the margin expansion story will continue unabated.
-

Substitution of bank funding through NCD issuance, will likely continue and
further easing will make the substitution incrementally more profitable too, as
base rates are likely to be stickier than wholesale rates.

However, margin expansion will be contingent on loan pricing discipline being

maintained. Management communication content and fact that LIC Housing
Finance still holds it minimum rate at 10.10% while both HDFC an d SBI have
both dropped minimum rates to 9.9%, holds much promise in this regard.

With developer and LAP loans still forming just 7.1% of total loans
(developer loans only 2.5% of portfolio), the insulation to any possible
market disappointment regarding the broader asset quality cycle within
financials, is high.

We continue to believe that the RBIs directive allowing banks to issue unsecured
bonds against affordable housing assets with zero regulatory costs, does NOT
impact the loan pricing environment for HFCs.

Our target price now works out to Rs525 with target multiple at 2.2x 1 -yr fwd
P/BVPS adjusted for DTL transfer.

We do not see a stock in our coverage that is more immune, in terms to

asset quality risks, to delays and disappointments to the broade r economic
recovery theme.

PFC (POWF IN, BUY, 12M TP Rs334, CMP - Rs260)

Our asset quality scenario analysis rules out risks of major book value
erosion. Cash flow and accrual analytics put at bay any fears of a severe crunch
in repayment cash flow from borrowers ever-greening fears look exaggerated.
However, PFC, has not restructured any non-private asset, and has sought
RBI clarification on the same. Hence a negative surprise on the earnings
front in the upcoming quarters cant be ruled out.

With restructuring provisioning norms having become applicable (with significant

relaxations) from March 31st, 2015, credit costs are likely to remain elevated

With RBIs notification allowing banks to raise long term bonds for infrastructure
project finance with zero regulatory costs, we have built in a significant yield
contraction due to increased competition. We have not given it an equivalent
benefit of wholesale easing thereby building a margin squeeze.

Modifying RoEs, to adjust for earlier low provisioning, trims them by 60-220bps
and shows up sustainable peer-comparable RoE at ~16-17% going forward
(despite our assumptions).

ICICI Securities

NBFCs, June 8, 2015

-

We recommend BUYing for a 12 month price target of Rs334. Our target multiple
is 1.1x P/BVPS (on Dec-2016), factoring in tail risks. Dividend sustainability
(3.5% FY15 yield) is also a key comfort factor.

The avoid list

M&M Financial Services (MMFS IN Equity, HOLD, 12M TP Rs282, CMPRs248)
-

One of the best known retail asset finance NBFCs (autos, tractors, some CVs and
recently added rural housing) with impeccable parentage and a reputation for
having one of tightest credit processes and deepest rural reach in the whole
industry. Loan AUM is close to US$6bn.

With large part of the borrower base geared to the rural income cycle
impacted by low MSP hikes, a patchy monsoon and contracted government
rural endowment programs GNPA had climbed beyond 7%. While some
improvement did come through in Q4FY15, the fact that provisioning release
was only 18% of net decrease in GNPAs implies that up graded assets were
low bucket GNPAs and the movement was more seasonal than cyclical in
nature.

Collection efforts are on but tightened processes can do very little if the current
income viability for the borrower is poor. The fear of another bad monsoon
weighs heavy.

Growth is low priority until the asset quality situation comes under complete
control. Some benefit to margins likely from interest rate easing.

Valuations at 2.1x FY16E P/BVPS are still not favorable enough for investment to
make sense even while the business is under duress.

Gruh Finance (GRHF IN Equity, REDUCE, 12M TP Rs145, CMP - Rs227)

-

GRUH Finance is the long term investors dream come true. i) Niche presence in
an opportunity space with large growth headroom, ii) premier competitive
positioning (finest rate lender) along with best-in-class raw material sourcing
(liability franchise), iii) low credit event risks due to a conservative credit culture/
segment characteristics and iv) the willingness to NOT pursue breakneck growth
in deference to long term business health.

The upshot, a business that makes 30%+ RoE and can self-sustain 25% loan
growth (without increasing leverage) for a long period. Hence, quibbles around a
valuation multiple of 8.7xFY16E P/BVPS are often dismissed as myopic!

However, our calculations suggest that even if business reality sticks to this rosy
script, a 5 year holding period will reward a new investor with only ~11%
annualised.

The incremental headwinds that we to see for the business are i) pressure on
margins and thereby RoE as NHB dependence reduces and ii) vulnerability of
loan growth to a weakening rural income cycle .

We urge investors to REDUCE with a TP of Rs145 (based on a target multiple of

4.5x on FY17E BVPS).

NBFCs, June 8, 2015

ICICI Securities

Table 2: NBFCs Valuations Comparables

Market Target Reco
P/E (x)
P/BV (x)
RoE (%)
EPS CAGR
Price
Cap price
(%)
(Rs) (Rs bn)
(Rs)
FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E (FY15-17E)
HDFC
1,177
1,854
1500
BUY 31.8
27.0
23.0
6.1
5.5
4.9 20.0
21.3
22.5
17.5
LIC Housing
403
203
525
BUY 14.7
11.8
9.7
2.6
2.0
1.7 18.0
20.3
20.9
23.0
GRUH Finance
227
82
145 REDUCE 40.4
31.5
26.8 11.0
8.7
7.0 30.9
33.1
32.2
22.8
Dew an Housing
395
58
590
BUY
9.3
7.0
5.5
1.2
1.1
0.9 15.1
16.5
18.2
30.1
IDFC
146
233
235
BUY 13.6
13.7
na
1.4
1.3
na 10.6
9.6
na
na
Shriram Transport
815
185
950
HOLD 18.0
11.4
8.4
2.0
1.7
1.5 11.5
16.2
18.8
46.0
Shriram City Union 1,647
109
1870 REDUCE 18.8
15.3
12.1
2.6
2.2
1.9 15.9
15.6
17.2
24.6
Mahindra Finance
248
141
282
HOLD 15.1
12.4
9.3
2.4
2.1
1.8 16.5
17.7
20.3
27.3
Muthoot Finance
188
75
233
BUY 11.1
8.9
7.7
1.5
1.3
1.2 14.3
15.7
16.4
20.2
Pow er Finance
260
344
334
BUY
5.9
5.4
4.7
1.1
0.9
0.8 19.5
18.6
18.6
12.4
Rural Electrification
283
279
475
BUY
5.1
4.3
3.5
1.1
0.9
0.8 24.1
23.7
23.7
19.9
Source: Bloomberg, Company data, I-Sec research

(Rs)

Jun-15

Dec-14

Jun-14

Dec-13

Jun-13

Gruh Finance
2,250

1,750

940

1,250

750

340
250

370
340
310
280
250
220
190
160
130
100
80
Jun-15

Shriram City Union Finance

Jun-14

340

Dec-14

290
290

Jun-15

Dec-14

Jun-14

Dec-13

Jun-13

Dec-12

Jun-12

Jun-12

Jun-15

Dec-14

Jun-14

Dec-13

Jun-15

Dec-14

Jun-14

Dec-13

Jun-13

390

Jun-13

220

Jun-13

440

340

Dec-13

390

Dec-12

REC

Dec-12

260

Jun-12

PFC

(Rs)

(Rs)
550
500
450
400
350
300
250
200
150

Dec-12

1,140
240
(Rs)

Jun-15

Dec-14

IDFC

Jun-12

1,340

(Rs)

Shriram Transport
Finance

Jun-15

140

Jun-14

180

(Rs)

Muthoot Finance

Jun-12
Dec-12
Jun-13
Dec-13
Jun-14
Dec-14
Jun-15

Jun-15

Jun-14

800

Dec-14

Jun-14

1000

Dec-13

140

Dec-14

Jun-13
Dec-13

1200

Jun-13

190

90

Dec-13

1400

200
180
160
140
120
100
80
60

Jun-12
Dec-12
Jun-13
Dec-13
Jun-14
Dec-14
Jun-15

140

60
Jun-13

Jun-12
Dec-12

1600

Jun-12

740

(Rs)

240

100

Jun-12

190

Dec-12

(Rs.)

HDFC

Dec-12

540

Jun-12
Dec-12
Jun-13
Dec-13
Jun-14
Dec-14
Jun-15

(Rs)
600

Dec-12

(Rs)

350
300
250
200
150
100
50
0

Jun-12

(Rs)

NBFCs, June 8, 2015

ICICI Securities

Price charts
LIC Housing Finance

Dewan Housing Finance

680

580

480

380

280

180

M&M Financial

NBFCs, June 8, 2015

ICICI Securities

This report may be distributed in Singapore by ICICI Securities, Inc. (Singapore branch). Any recipients of this report in Si ngapore should contact ICICI Securities,
Inc. (Singapore branch) in respect of any matters arising from, or in connection with, this report. The contact details of ICICI Securities, Inc. (Singapore branch) are
as follows: Address: 10 Collyer Quay, #37-16 Ocean Financial Tower, Singapore - 049315, Tel: +65 6232 2451 and email: navneet_babbar@icicisecuritiesinc.com,
Rishi_agrawal@icicisecuritiesinc.com.
"In case of eligible investors based in Japan, charges for brokerage services on execution of transactions do not in substanc e constitute charge for research
reports and no charges are levied for providing research report s to such investors."
New I-Sec investment ratings (all ratings based on absolute return)

BUY: >15% return; ADD: 5% to 15% return; HOLD: Negative 5% to Positive 5% return; REDUCE: Negative 5% to Negative 15% return; SELL: < negative 15% return
ANALYST CERTIFICATION
We /I, Santanu Chakrabarti, PGDM; Yash Modi, PGDM; Research Analy sts, authors and the names subscribed to this report, hereby certif y that all of the v iews
expressed in this research report accurately ref lect our v iews about the subject issuer(s) or securities. We also certif y that no part of our compensation was, is, or will
be directly or indirectly related to the specif ic recommendation(s) or v iew(s) in this report. Analy sts are not registered as research analy sts by FINRA and are not
associated persons of the ICICI Securities Inc.
Terms & conditions and other disclosures:
ICICI Securities Limited (ICICI Securities) is a f ull-serv ice, integrated inv estment banking and is, inter alia, engaged in the business of stock brokering and distribution
of f inancial products. ICICI Securities is a wholly -owned subsidiary of ICICI Bank which is Indias largest priv ate sector bank and has its v arious subsidiaries engaged
in businesses of housing f inance, asset management, lif e insurance, general insurance, v enture capital f und management, etc. (associates), the details in respect of
which are av ailable on www.icicibank.com.
ICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in v irtually all securiti es trading markets in India. We and our
associates might hav e inv estment banking and other business relationship with a signif icant percentage of companies cov ered b y our Inv estment Research
Department. ICICI Securities generally prohibits its analy sts, persons reporting to analy sts and their relativ es f rom maintaining a f inancial interest in the securities or
deriv ativ es of any companies that the analy sts cov er.
The inf ormation and opinions in this report hav e been prepared by ICICI Securities and are subject to change without any notice. The report and inf ormation contained
herein is strictly conf idential and meant solely f or the selected recipient and may not be altered in any way , transmitted to , copied or distributed, in part or in whole, to
any other person or to the media or reproduced in any f orm, without prior written consent of ICICI Securities. While we would endeav our to upda te the inf ormation
herein on a reasonable basis, ICICI Securities is under no obligation to update or keep the inf ormation current. Also, there may be regulatory , compliance or other
reasons that may prev ent ICICI Securities f rom doing so. Non-rated securities indicate that rating on a particular security has been suspended temporarily and such
suspension is in compliance with applicable regulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an adv isory
capacity to this company , or in certain other circumstances.
This report is based on inf ormation obtained f rom public sources and sourc es believ ed to be reliable, but no independent v erif ication has been made nor is its accuracy
or completeness guaranteed. This report and inf ormation herein is solely f or inf ormational purpose and shall not be used or c onsidered as an of f er document or
solicitation of of f er to buy or sell or subscribe f or securities or other f inancial instruments. Though disseminated to all the customers simultaneously , not all customers
may receiv e this report at the same time. ICICI Securities will not treat recipients as customers by v irtue of their receiv ing this report. Nothing in this report constitutes
inv estment, legal, accounting and tax adv ice or a representation that any inv estment or strategy is suitable or appropriate t o y our specif ic circumstances. The
securities discussed and opinions expressed in this report may not be suitable f or all inv estors, who must make their own inv estment decisions, based on their own
inv estment objectiv es, f inancial positions and needs of specif ic recipient. This may not be taken in substitution f or the exercise of independent judgment by any
recipient. The recipient should independently ev aluate the inv estment risks. The v alue and return on inv estment may v ary beca use of changes in interest rates, f oreign
exchange rates or any other reason. ICICI Securities accepts no liabilities whatsoev er f or any loss or damage of any kind arising out of the use of this report. Past
perf ormance is not necessarily a guide to f uture perf ormance. Inv estors are adv ised to see Risk Disclosure Document to understand the risks associated bef ore
inv esting in the securities markets. Actual results may dif f er materially f rom those set f orth in projections. Forward -looking statements are not predictions and may be
subject to change without notice.
ICICI Securities or its associates might hav e managed or co-managed public of f ering of securities f or the subject company or might hav e been mandated by the
subject company f or any other assignment in the past twelv e months.
ICICI Securities or its associates might hav e receiv ed any compensation f rom the companies mentioned in the report during the period preceding twelv e months f rom
the date of this report f or serv ices in respect of managing or co-managing public of f erings, corporate f inance, inv estment banking or merchant banking, brokerage
serv ices or other adv isory serv ice in a merger or specif ic transaction.
ICICI Securities or its associates might hav e receiv ed any compensation f or products or serv ices other than inv estment bankin g or merchant banking or brokerage
serv ices f rom the companies mentioned in the report in the past twelv e months.
ICICI Securities encourages independence in research report preparation and striv es to minimize conf lict in preparation of re search report. ICICI Securities or its
analy sts did not receiv e any compensation or other benef its f rom the companies mentioned in the report or third party in connection with preparation of the research
report. Accordingly , neither ICICI Securities nor Research Analy sts hav e any material conf lict of int erest at the time of publication of this report.
It is conf irmed that Santanu Chakrabarti, PGDM; Yash Modi, PGDM; Research Analy sts of this report hav e not receiv ed any compensation f rom the companies
mentioned in the report in the preceding twelv e months .
Compensation of our Research Analy sts is not based on any specif ic merchant banking, inv estment banking or brokerage serv ice transactions.
ICICI Securities or its subsidiaries collectiv ely or Research Analy sts do not own 1% or more of the equity securi ties of the Company mentioned in the report as of the
last day of the month preceding the publication of the research report.
Since associates of ICICI Securities are engaged in v arious f inancial serv ice businesses, they might hav e f inancial interests or benef icial ownership in v arious
companies including the subject company /companies mentioned in this report.
It is conf irmed that Santanu Chakrabarti, PGDM; Yash Modi, PGDM; Research Analy sts do not serv e as an of f icer, director or employ ee of the companies mentioned
in the report.
ICICI Securities may hav e issued other reports that are inconsistent with and reach dif f erent conclusion f rom the inf ormation presented in this report.
Neither the Research Analy sts nor ICICI Securities hav e been engaged in market making activ ity f or the companies mentioned in the report.
We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equit y Research Analy sis activ ities.
This report is not directed or intended f or distribution to, or use by , any person or entity who is a citizen or resident of or located in any locality , state, co untry or other
jurisdiction, where such distribution, publication, av ailability or use would be contrary to law, regulation or whic h would subject ICICI Securities and af f iliates to any
registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible f o r sale in all jurisdictions or to certain category
of inv estors. Persons in whose possession this document may come are required to inf orm themselv es of and to observ e such restriction.
This report has not been prepared by ICICI Securities, Inc. Howev er, ICICI Securities, Inc. has rev iewed the report and, in s o f ar as it includes current or historical
inf ormation, it is believ ed to be reliable, although its accuracy and completeness cannot be guaranteed.