Gladiator Stocks: Auto ancillary thematic - Tyres

Scrip I Direct Code Action Target Stoploss UpsideScrip I-Direct Code Action Target Stoploss UpsideApollo Tyres APOTYR Buy in the range of 225-230 270.00 207.00 19%JK Tyre JKTYRE Buy in the range of 162-167 198.00 146.00 20%Time Frame: 6 Months

Research AnalystsDharmesh Shah dharmesh.shah@icicisecurities.com Pabitro Mukherjee pabitro.mukherjee@icicisecurities.comNitin Kunte CMT nitin kunte@icicisecurities com Vinayak Parmar vinayak parmar@icicisecurities comNitin Kunte, CMT nitin.kunte@icicisecurities.com Vinayak Parmar vinayak.parmar@icicisecurities.comDipesh Dagha dipesh.dagha@icicisecurities.com

May 16, 2017

Deal Team – At Your ServiceAuto ancillary thematic: Declining natural rubber prices; boon for tyre stocks...

•Average natural rubber (NR) (accounts for ~40% of total raw material cost) prices have been more volatile in the past year – surging from lows of| 94/kg in February 2016 to the high of | 159/kg in February 2017. The sharp surge in NR prices was mainly due to 1) production cut of top NRproducing countries (Thailand, Indonesia & Malaysia account for >60% of world’s production), 2) floods in Thailand (impacted its production)coupled with higher demand from China in the same period resulting in NR prices moving northwards. However, of late, NR prices have correctedto | 129/kg currently and are likely to benefit tyre players. We believe the situation will normalise in major rubber producing countries & NR pricesare likely to stay benign, going forward. In addition to the recent correction in NR prices, major tyre players have undertaken a price hike of ~10%in the past six months, which is likely to cushions their margins, going forward.

•In this edition of our auto ancillary thematic series, we are looking at Apollo Tyres and JK Tyre & Industries

300 0 •Rubber prices posted a pullback during

200.0

250.0

300.0 Rubber price vs. stock price •Rubber prices posted a pullback during2016 after a prolonged bear market through2013-15

•Stock prices have a negative correlationwith natural rubber prices with a lead effect

100.0

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12M_avg Rubber price

JKTYRES

Apollo tyres

•As can be seen in the adjacent chart, during2016, share prices topped ahead of bottomin natural rubber prices while at thebeginning of 2017 share prices bottomed outahead of the peak in natural rubber prices

Th t b k t f t t di

0.0

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•The recent breakout from a two year tradingrange in share prices of Apollo Tyres and JKTyres may be seen in this context

•Natural rubber prices have dipped belowtheir 12 month average recently. Benignrubber prices would augur well for tyre

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rubber prices would augur well for tyrecompanies, going ahead

Apollo Tyres (APOTYR): Price rebounding from major breakout area...

CMP | 230 00 B i R | 225 230 T t | 270 00 St l | 207 00 U id 19%

Technical ViewApollo Tyres is a large cap tyre company. It is a global player with good business diversification across geographies.The share price of Apollo Tyres remains in a strong uptrend forming higher highs and higher lows representingpersistent demand at elevated levels. The recent price action highlights that the stock is rebounding from a majorb k t i di ti ti f th i t d th b idi f h t t it

Stock Data

CMP: | 230.00 Buying Range: | 225-230 Target: | 270.00 Stop loss: | 207.00 Upside: 19%

52 Week High / Low 254.25/139.3550 days EMA 221

200 days EMA 198 breakout area indicating resumption of the primary uptrend thereby providing a fresh entry opportunity.Breakout above major downward sloping trend line and Bullish rounding patternThe entire price action since October 2016 till April 2017 appears to have taken the shape of a Rounding pattern ashighlighted in the adjoining weekly chart. A rounding formation within an established uptrend develops as a bullishcontinuation pattern marking a secondary corrective phase amid profit bookings by weaker hands and accumulationby stronger hands at the base of the pattern.The strong up move in March & April 2017 propelled the stock past the neckline of rounding pattern placed around the

*Recommendation given on i-click to gain on May 152017 at 11:13 hrs

00 d ys 98

52 Week EMA 196

Face Value (|) 1Market Capitallisation (| Cr.) 11743

g p p p p p g p p| 220 region, which also coincides with the breakout area from the long term downward sloping trend line joining thehighs of February 2015 (| 249) and October 2016 (| 234) during April 2017. The breakout above the major technicalpattern signals conclusion of the corrective phase and resumption of the primary uptrendAfter a strong breakout rally in March & April 2017 from | 177 to | 254, the share price was seen taking a breather inthe past two weeks. The temporary pause after a sharp rally has helped it to work its way out of the overboughtcondition and in the process built a higher base. In the current week’s trade, the stock has rebounded taking supportat the major breakout area of | 220 highlighting a robust price structure and resumption of the up move

Stock price vs. BSE 200

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at the major breakout area of | 220 highlighting a robust price structure and resumption of the up moveThe 61.8% retracement of the March & April 2017 rally from | 177 to | 254 is placed around | 207, which will act as amajor support base for the stock in the short-term.Faster retracement of fall reinstates bullish momentumTime wise, the stock took over 19 weeks to correct from high of | 234 to the base of rounding pattern at | 170.However, the up move from there on has seen the stock completely overhaul the 19 weeks fall in just 10 weeks. Fasterretracement of the major falling segment confirms the overall positive price structure and reinstates the bullish

t hi h ll f th t k i f dPrice performance in last five years

2,800100

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momentum, which augurs well for the stock, going forward.Momentum oscillator provide early signs of turnaroundThe weekly MACD (E-12/26/9) is in a rising trend forming higher high and higher low and is seen sustaining in thepositive territory highlighting the underlying strength in the trend thus supports continuation of the uptrend.ConclusionWe believe the stock is attractively placed and offers a favourable risk-reward setup for medium term players to ridethe next up move We expect the stock to resolve higher from here on and test levels of | 270 being the measuring

51%20%

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the next up move. We expect the stock to resolve higher from here on and test levels of | 270 being the measuringimplication of the rounding pattern breakout i.e. The distance from the neckline to the base of the pattern (| 220-170=50 points) added to the breakout point of | 220 projects upside target of | 270 ( 220+50) over the medium termSource: Bloomberg, BSE, ICICIdirect.com Research

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Apollo Tyres (APOTYR): Weekly Bar Chart

Measuring implication of roundingpattern breakout @ 270

249

Price rebounded taking support at the major breakoutarea of | 240 highlighting a robust price structure andresumption of the up move

249234

Base of the rounding pattern at | 170 levels beingfl f

140

170

confluence of:- 61.8% retracement of previous rally | 140-234- The rising 52 weeks EMA

Weekly MACD in uptrend and sustaining in the positive territoryhighlights the underlying strength in the trend

Source: Bloomberg, ICICIdirect.com Research

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Stock Data

Apollo Tyres (APOTYR): Fundamental view

Fundamental ViewStock Data Fundamental View

Well placed for demand revivalApollo Tyres (ATL) is well placed to benefit from the radialisation story in India. It enjoys a 25% market share intruck tyre segment (in both TBB & TBR). ATL is likely to improve radial volumes, and is increasing its radial capacity,(phase 1 of radial capacity has been commissioned in Q4CY16) with full capacity set to come on stream in mid2018, thus driving its growth. Further, import of Chinese tyre has declined to <50% of its peak import in Q2FY16(i d b d i i ) d i b fi i h d i i d i ll ATL Th h

Particular AmountMarket Capitalization (| Crore) | 11644 CroreTotal Debt (FY16) (| Crore) 3,244.5Cash & Investments (FY16) (| Crore) 731.4EV (| Crore) 14,157.652 week H/L (|) 254 / 139

(impacted by demonetisation) and is benefiting the domestic tyre industry, especially ATL. Thus, the managementis positive on demand outlook & expects double digit volume growth in FY18E.

Strong brand + distribution = to supports its European performance!ATL’s overall European operation reported volume growth of 12% YoY in FY17 and was mainly supported bystrong volumes of its Vredestein brand in the PV space. It continues to expand its PCR capacity in Hungary (hasplanned capex of €180 million, | 1,250 crore in FY18E), which is likely to cater to rising demand, going forward.

Key Metrics

52 week H/L (|) 254 / 139Equity capital (| crore) | 50.4 CroreFace value (|) | 1

FY16 FY17E FY18E FY19E planned capex of €180 million, | 1,250 crore in FY18E), which is likely to cater to rising demand, going forward.Apart from that, acquisition of Reifencom - one of the leading tyre retail chain in Germany (with >37 stores), willenhance brand visibility. Q4FY17 is seasonally weak for Reifencom, which posted negative EBITDA margins of 5%,thereby impacting overall margins. However, the management expects Reifencom margins (~2% per annum) togradually improve, going forward.

Margin to be impacted in FY18E; though likely to improve, going forwardA NR i h b l til f l f | 94/k i F b 2016 t | 159/k i F b 2017 t

FY16 FY17E FY18E FY19EP/E (x) 11.0 10.6 11.7 9.9 EV/EBITDA (x) 6.2 7.7 8.3 7.3 P/BV (x) 1.9 1.6 1.4 1.3 RoNW (%) 17.1 15.0 12.2 12.9 RoCE (%) 19.9 13.6 11.0 12.0

Average NR prices have been volatile - from lows of | 94/kg in February 2016 to | 159/kg in February 2017 to| 129/kg currently. According to the management, the impact of raw material price rise was 23% (13% in Q3FY17 &10% in Q4FY17) & requires 15% ASP hike (fully passing on) to maintain its margins. Though, till date, they haveincreased prices by 6% (3% each in Q4FY17 & in April 2017). Looking at the inventory and current NR prices, themanagement expects its margins to remain under pressure in H1FY18. It is likely to ease out afterwards. Also, start-up cost in Hungary is likely to put pressure on European margins. Thus, we expect lower margins in FY18E with animprovement in FY19E.

Financial Highlights

| Crore FY16 FY17E FY18E FY19ENet Sales 11,793 13,180 15,014 16,420 EBITDA 1,968.3 1,846.4 1,807.8 2,099.8 Net Profit 1,093.0 1,099.3 992.2 1,176.9

Decent business case as valuations remain fair!ATL is investing in more diversified, rapid growth areas coupled with a larger scale of business in coming years.Further, the management expects demand to recover, going forward. Hence, we remain positive on the stock froma long term perspective.

Source: Company, ICICIdriect.com Research

EPS (|) 21.7 21.8 19.7 23.3

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JK Tyre & Industries (JKTYRE): Bullish Cup and Handle pattern breakout...

CMP | 167 00 B i R | 162 167 T t | 198 00 St l | 146 00 U id 20%

Key technical observationsJK Tyre & Industries is an automotive tyre, tubes and flaps manufacturing company. The company is the market leaderin truck/bus radial tyre in India. The share price of JK Tyre remains in a secular uptrend forming rising peaks andtroughs on the long term charts and has generated superior returns for long term investors on a consistent basis overh Wi hi h l d h k h i d i di d i h h

Stock Data

CMP: | 167.00 Buying Range: | 162-167 Target: | 198.00 Stop loss: | 146.00 Upside: 20%

52 Week High / Low 184.80/79.2050 days EMA 150

200 days EMA 129the past many years. Within the structural uptrend, the stock has witnessed periodic secondary corrections that haveprovided fresh entry opportunities. Recent developments on the price front suggest that the stock has concluded anelongated corrective phase in the last two years and is poised to embark upon its next major up move therebyproviding a fresh entry opportunity to medium term investors.Cup and Handle pattern breakout triggers bullish turnaround...The stock entered a secondary corrective phase after hitting a high of | 160 in December 2014. The entire correctiveprice action over the past 28 months took the pictorial form of a well defined Cup & Handle pattern as highlighted in

*Recommendation given on i-click to gain on May162017 at 09:24 hrs

00 d ys 9

52 Week EMA 127

Face Value (|) 2Market Capitallisation (| Cr.) 3830

p p p p p g gthe adjoining chart. A Cup & Handle formation is a bullish continuation price pattern having positive implication on theprice front upon resolution above the neckline of the pattern.The sharp up move during March and April 2017 from the low of | 117 saw the stock register a resolute breakoutabove the neckline of the Cup and Handle pattern at | 160 signalling the end of the secondary correction andresumption of the next up leg, thereby offering a fresh entry opportunity to ride the ongoing uptrend from a medium-term perspective.After the strong breakout rally from | 117 to | 184 in just two months the stock entered a sideways corrective trend in

Stock price vs. BSE 500

9 00010,00011,00012,00013,00014,00015,000

80100120140160180

After the strong breakout rally from | 117 to | 184 in just two months, the stock entered a sideways corrective trend inthe last two week’s. In the current week trade it has rebounded taking support near the recent breakout area of | 160highlighting the change of polarity principle as per which a significant resistance once taken out reverses its role andacts as support for future price movement.The 61.8% retracement of the March & April 2017 rally from | 117 to | 184 is placed around | 146 levels, which will actas a major support base for the stock in the short-term.Volume behaviour, momentum oscillators confirm strength in price breakout...Th i i d li i D b 2014 h b k f di l Th d i h

Price performance in last five years

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The entire corrective decline since December 2014 was on the back of receding volumes. The up move during themiddle of 2016 and the recent rally of the last two months has seen strong participation as weekly volumes of almostdouble of the 50 weeks average volume of 90 lakh share per week. Volumes rising in the direction of primary trendhighlight inherent strength in the trend. Among oscillators, the weekly 14 periods RSI is forming higher high andhigher low and is seen taking support at its nine period average signalling strength in the price trendConclusionBased on the aforementioned technical observations, we believe the stock has concluded a healthy corrective phase

2012 2013 2014 2015 2016 and is set to embark on a sustained up move. We expect the share price to head towards | 199 levels over themedium term being the 161.8% external retracement of the recent decline from | 184 to | 160 levels

Source: Bloomberg, BSE, ICICIdirect.com Research

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JK Tyre & Industries (JKTYRE): Weekly Bar Chart

Consolidation above the 28 months bullish Cup & Handle breakout areasuggests accumulation and thus offers fresh entry opportunity

161.8% external retracementof previous decline @ 199

117

Neckline of the Cup & Handle pattern @ 160

117

74 The long term 52 Weeks EMA hasacted as strong support for thestock during the entire consolidation

W kl RSI i d d i ki

Low volume during price correction and strong volume during price rally signalslarger participation in the direction of trend

Weekly RSI in uptrend and is seen takingsupport at its nine period’s average thusvalidates positive bias

Source: Bloomberg, ICICIdirect.com Research

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Stock Data

JK Tyre & Industries (JKTYRE): Fundamental view

Fundamental ViewStock Data Fundamental ViewSigns of Chinese imports fading awayJK Tyres & Industries (JKTIL) is one of the leading player in the M&HCV truck bus radial (TBR) segment with marketshare >30%. In the passenger car radial (PCR) segment, it has a share of >12% in India. Import of Chinese radialtyre in India had substantially increased from May 2015. Average monthly TBR import from China was at ~54,000 inCY13, surging to 166,000 tyres in June 2016. However, since then, Chinese TBR imports have gradually come down- 52,000 tyres in January 2017, mainly due to 1) demonetisation adversely impacting Chinese TBR distributors inIndia as their transactions were largely cash based 2) media reports suggest US International Trade Commission

Particular AmountMarket Capitalization (| Crore) | 3855.6 CroreTotal Debt (FY16) (| Crore) 2,669.7Cash & Investments (FY16) (| Crore) 154.4EV (| Crore) 6,370.952 week H/L (|) 185/79

India as their transactions were largely cash based, 2) media reports suggest US International Trade Commissionwill not levy any kind of duty on Chinese tyres, making US a preferable destination for Chinese TBR exports. Thereduction in Chinese TBR import is positive for a player like JKTIL (derives 74% of its revenue from CV segment).Lastly, any anti-dumping duty on imports of tyres, will favour JKTIL.

Price hikes to support marginsAverage NR (key input cost) prices have been more volatile - from lows of | 94/kg in February 2016 to | 159/kg in

Key Metrics

Equity capital (| crore) | 45.4 CroreFace value (|) | 2

FY16 FY17E FY18E FY19EFebruary 2017 to | 128/kg currently. The sharp surge in NR prices was mainly due to 1) production cut of top NRproducing countries (Thailand, Indonesia & Malaysia account for >60% of world’s production), 2) floods in Thailand(impacted its production) coupled with higher demand from China in the same period resulting in NR prices movingnorthwards. However, we believe the situation will normalise. NR prices are likely to stay benign, going forward. Toprotect their operating performance, major tyre players (including JKTIL) undertook a price hike of ~10% in the pastsix months that will cushions their margins. Average prices of other raw material costs (that are crude linked) mayalso stay subdued. Further, a better product mix (higher share of radial tyres) will also support margins

P/E (Dil.) (x) 7.6 11.8 8.5 6.1 EV/EBITDA (x) 5.6 7.9 4.9 4.1 P/B (x) 2.2 1.9 1.7 1.4 RoNW (%) 29.1 15.8 19.7 22.4 RoCE (%) 20.1 11.2 14.3 16.2

Acquisition of Cavendish Industries to yield better returnsThe acquisition of the Laksar unit (of CIL) has strengthened JKTIL’s leadership position in the TBR segment andhelped them enter the fast growing 2-W & 3-W segments. According to the management, JKTIL has managed toturn around the unit by higher productivity & reduced its plant conversion cost (down 40%) thereby turning PBTpositive. We believe CIL would have been operating at very low utilisation level at its time of acquisition. Theutilisation is gradually expected to ramp up (considering JKTIL’s stake of 64% in the unit could contribute maximum

Financial Highlights| crore FY16 FY17E FY18E FY19ENet Sales 6,953 7,492 8,332 9,342 EBITDA 1,141.5 1,273.0 1,365.0 1,526.7 Net Profit 476.2 352.1 509.1 667.6 FDEPS (|) 21 0 15 5 22 4 29 4 utilisation is gradually expected to ramp up (considering JKTIL s stake of 64% in the unit could contribute maximum

revenues of >| 4,000 crore) thereby generating higher margins. Thus, CIL is likely to yield better returns, goingforward

Attractive valuationsThe expectation of a revival in the capex cycle makes us optimistic about the revenue/earnings growth possibilities.Its plans to explore the 2-W space and new radial capacity would drive incremental growth. JKTIL is available at

Source: Company, ICICIdriect.com Research

FDEPS (|) 21.0 15.5 22.4 29.4

attractive valuation - currently trading at PE of 8x FY18E vs. the tyre industry average of >13x. Thus, we remainpositive on the stock

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Strategy Follow up

Open Recommendations:

Date Scrip Name Rec Price Target Stoploss CMPReturn till date

(%)( )20-Mar-17 IDBI 75 98 66 75 0.0%11-Apr-17 Ashoka Buidcon 208 258 184 213 2.4%18-Apr-17 EIH Ltd 127 152 112 135 6.3%21-Apr-17 Cera Sanitaryware 2934 3680 2520 3040 3.6%21-Apr-17 VST Tillers 1880 2285 1660 1997 6.2%21-Apr-17 Monsanto 2570 3060 2280 2704 5.2%27-Apr-17 Nestle India 6520 7750 5875 6645 1.9%3-May-17 Cummins India 1070 1250 970 1064 -0.6%4-May-17 Vadilal Industries 930 1245 810 935 0.5%9-May-17 Larsen & Toubro 1705 2035 1540 1746 2.4%9-May-17 BGR Energy 173 210 152 174 0.6%11-May-17 Rallis India 244.5 295 215 249 1.8%11-May-17 Hero MotoCorp 3380 3830 2150 3512 3.9%

Summary Performance - Recommendations till date Open Recommendations 13

Total Recommendations 159 Yield on Positive recommendations 20.0%Closed Recommendations 146 Yield on Negative recommendations -8.0%Positive Recommendations 111Strike Rate 76%

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Notes…

• It is recommended to enter in a staggered manner within the prescribed range provided in the report

• Once the recommendation is executed, it is advisable to keep strict stop loss as provided in the report on closing basis.

• The recommendations are valid for six months and in case we intend to carry forward the position, it will be communicated through separate mail.

Trading portfolio allocationTrading portfolio allocation

• It is recommended to spread out the trading corpus in a proportionate manner between the various technical research products

• Please a oid allocati g the e ti e t adi g co p s to a si gle stock o a si gle p od ct • Please avoid allocating the entire trading corpus to a single stock or a single product segment

• Within each product segment it is advisable to allocate equal amount to each recommendationF l Th ‘D il C ll ’ d i 3 i d d i I i • For example: The ‘Daily Calls’ product carries 3 to 4 intraday recommendations. It is advisable to allocate equal amount to each recommendation

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Recommended product wise trading portfolio allocation

Duration

Daily Calls 8% 2-3% 3-4 Stocks 0.5-1% 2-3% Intraday

Number of CallsReturn Objective

Frontline Stocks Mid Cap StocksProduct Product wise

allocation

AllocationsMax allocation in

1 Stock

Stocks on the Move 6% 3-5% 7-10 Per Months 7-10% 10-15% 3 Months

Weekly Calls 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week

Weekly Technicals 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week

Monthly Call 15% 5% 2-3 Stocks 7-10% 10-15% 1 Month

Monthly Technical 15% 2-4% 5-8 Stocks 7-10% 10-15% 1 Month

Techno Funda 15% 5-10% 1-2 Stocks 10% and above 15% and above 6 Months

Gladiator Stocks 15% 5 10% 1 2 Stocks 15% and above 20% and above 6 MonthsGladiator Stocks 15% 5-10% 1-2 Stocks 15% and above 20% and above 6 Months

Cash 10% -100%

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

ICICIdirect.com Research Desk,ICICI Securities Limited,1st Floor Akruti Trade Centre1st Floor, Akruti Trade Centre,Road No 7, MIDCAndheri (East)Mumbai – 400 093research@icicidirect.com

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DisclaimerANALYST CERTIFICATION

We /I Dharmesh Shah Dipesh Dagha Nitin Kunte Pabitro Mukherjee Vinayak Parmar Research Analysts authors and the names subscribed toWe /I, Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee, Vinayak Parmar Research Analysts, authors and the names subscribed tothis report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) orsecurities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) orview(s) in this report.Terms & conditions and other disclosures:ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stockbrokering and distribution of financial products. ICICI Securities Limited is a SEBI registered Research Analyst with SEBI Registration Number –g p g y gINH000000990.ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India’s largest private sector bank and has its varioussubsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fundmanagement, etc. (“associates”), the details in respect of which are available on www.icicibank.comICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India.We and our associates might have investment banking and other business relationship with a significant percentage of companies covered by ourInvestment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts and their relatives from

i i i fi i l i i h i i d i i f i h h lmaintaining a financial interest in the securities or derivatives of any companies that the analysts cover.The information and opinions in this section have been prepared by ICICI Securities and are subject to change without any notice. The report andinformation contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmittedto, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ICICISecurities. While we would endeavour to update the information herein on reasonable basis, ICICI Securities is under no obligation to update orkeep the information current. Also, there may be regulatory, compliance or other reasons that may prevent ICICI Securities from doing so. Non-rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicablerated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicableregulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this company, or incertain other circumstances.The research recommendations are based on information obtained from public sources and sources believed to be reliable, but no independentverification has been made nor is its accuracy or completeness guaranteed. These research recommendations and information herein is solely forinformational purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities orother financial instruments. ICICI Securities will not treat recipients as customers by virtue of their receiving these recommendations. Nothing inthis section constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriateto your specific circumstances. The securities discussed and opinions expressed herein may not be suitable for all investors, who must maketheir own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not betaken in substitution for the exercise of independent judgment by any recipient. The recipient should independently evaluate the investment risks.The value and return on investment may vary because of changes in interest rates, foreign exchange rates or any other reason. ICICI Securitiesaccepts no liabilities whatsoever for any loss or damage of any kind arising out of the use of these recommendations. Past performance is notnecessarily a guide to future performance Investors are advised to see Risk Disclosure Document to understand the risks associated before

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necessarily a guide to future performance. Investors are advised to see Risk Disclosure Document to understand the risks associated beforeinvesting in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are notpredictions and may be subject to change without notice.

DisclaimerICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have beenmandated by the subject company for any other assignment in the past twelve months.ICICI Sec ities o its associates ight ha e ecei ed a co pe satio f o the co pa ies e tio ed he ei d i g the pe iod p ecedi gICICI Securities or its associates might have received any compensation from the companies mentioned herein during the period precedingtwelve months from the date of these recommendations for services in respect of managing or co-managing public offerings, corporatefinance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchantbanking or brokerage services from the companies mentioned herein in the past twelve months.ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICISecurities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or thirdSecurities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or thirdparty in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts and their relatives haveany material conflict of interest at the time of publication of this reports.It is confirmed that Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee and Vinayak Parmar, Research Analysts giving theserecommendations have not received any compensation from the companies mentioned herein in the preceding twelve months.Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactionsICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the

/ i i d h i f h l d f h h di h bli i f h h d icompany/companies mentioned herein as of the last day of the month preceding the publication of these research recommendations.Since Associates (ICICI group companies) of ICICI Securities are engaged in various financial service businesses, they might have financialinterests or beneficial ownership in various companies including the subject company/companies mentioned herein.It is confirmed that Research Analysts do not serve as an officer, director or employee or advisory board member of the companies mentionedherein.ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented herein.Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned hereinNeither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned herein.We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysisactivities.This report or recommendations are not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of orlocated in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary tolaw, regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. Thesecurities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possessionthis document may come are required to inform themselves of and to observe such restriction.

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