itnl, 5th february, 2013

7/29/2019 ITNL, 5th February, 2013

1/13

Please refer to important disclosures at the end of this report 1

Op. profit 450 321 40.2 453 (0.6)

Source: Company, Angel Research

For 3QFY2013, on a consolidated basis, IL&FS Transportation Networks (ITNL)

posted a strong performance on the top-line and EBITDAM fronts. The robust

performance was on account of higher-than-expected revenue growth, led by

E&C revenue. However, higher interest cost and tax provision led to a subdued

growth at the bottom-line level. With the company being a market leader in its

segment, having a robust order book and diversified portfolio, we believe it is

well placed to leverage on the upcoming opportunities in the road sector.

: ITNL reported a revenue of `1,764cr in

3QFY2013 (`1,268cr in 3QFY2012), registering a yoy growth of 39.1%, which is

12% higher than our estimate. This is mainly on account of increased

contribution from the E&C segment. The EBITDA margin declined sequentially by

754bp to 25.5% in 3QFY2013 (against our estimate of 28%) vs 25.3% in

3QFY2012. ITNLs interest cost grew by 53.3% yoy to`284cr for the quarter and

was marginally above our estimate of `280cr. On the earnings front, ITNL

reported a subdued growth of 18.5% yoy to`104cr (our estimate was of`108cr)

on back of higher interest cost and tax provision (40%) during the quarter.

: Going forward, we expect ITNL to report revenue CAGR

of 12% over FY2012-14. This would be on the back of an order book of

`9,795.5cr (excluding L1 orders of `2,344cr), indicating order book-to-sales

ratio of 1.5x trailing revenues. The stock trades at a P/BV of 1.2x and 1.1x for

FY2013E and FY2014E, respectively.

% chg 68.1 38.5 17.1 7.5

% chg 25.8 14.6 2.6 10.5

EBITDA (%) 28.5 26.1 27.2 27.4

P/E (x) 9.1 7.9 7.7 7.0

P/BV (x) 1.7 1.4 1.2 1.1

RoE (%) 21.8 19.6 17.0 16.3

RoCE (%) 16.4 12.9 10.8 9.7

EV/Sales (x) 2.2 2.5 2.7 2.8

EV/EBITDA (x) 7.7 9.5 10.0 10.1

OB/sales(x) 3.3 2.8 2.3 2.6

Order inflow 3,036 7,142 5,185 5,423

%chg 12.1 135.3 (27.4) 4.6


CMP `203

Target Price `225

Investment Period 12 Months

Stock Info

Sector

Net debt 12,500

Bloomberg Code

Shareholding Pattern (%)

Promoters 72.5

MF / Banks / Indian Fls 3.1FII / NRIs / OCBs 3.7

Indian Public / Others 20.8

Abs. (%) 3m 1yr 3yr

Sensex 5.3 12.2 25.1

#ITNL 6.7 (0.3) #

Reuters Code ILFT.BO

ILFT@IN

BSE Sensex 19,751

Nifty 5,987

Avg. Daily Volume 23,712

Face Value (`) 10

Beta 0.9

52 Week High / Low 227/157

Infrastructure

Market Cap (`cr) 3,940

#Note: since listing in March 2010

022-39357800 Ext: 6842

[email protected]

Performance Highlights

3QFY2013 Result Update | Infrastructure

February 4, 2013


2/13

ITNL | 3QFY2013 Result Update

February 4, 2013 2

Exhibit 1:3QFY2013 performance (Consolidated)

OPM (%) 25.5 25.3 21bp 33.0 (754) bp 29.0 27.9 115bp

Interest 284 185 53.3 280 1.4 817 497 64.2

Depreciation 22 17 29.7 18 22.9 64 49 30.6

Non Operating Income 32 30 8.0 42 (24.1) 109 78 39.4

Nonrecurring items/Dividend from SPV's - - - - - - - -

Tax 65 47 79 (17.6) 236 189 25.1

Share of Profits/ (Losses) of Asso. 0 (1) - 3 - 1 (4) -

Share of Profits/ (Losses) of MI 6 12 - 5 - 21 28 -

PAT (%) 5.9 6.9 (102) bp 8.5 (256) bp 7.2 8.8 (159) bp


Exhibit 2:Actual vs Estimates

Net sales 1,575 1,764 12.0

EBITDA 441 450 2.0

Interest 280 284 1.5Tax 57 65 14.8

PAT 108 104 (3.2)


Stellar top-line performance due to increased E&C revenue

ITNL reported a revenue of `1,764cr in 3QFY2013 (`1,268cr in 3QFY2012),

registering a growth of 39.1% yoy, which is 12% higher than our estimate. This

was mainly on account of increased contribution from the E&C segment. The E&C

division reported a revenue growth of 36.9% yoy to `1,239cr while the toll and

annuity income grew by 50.1% yoy to `223cr. The toll and annuity income hasincreased due to (a) higher traffic on toll road projects, (b) inclusion of toll

revenues of YuHe project from 1QFY2013 and (c) increase in finance income

recognized from annuity projects. During the quarter, the revenue from Elsamex

came in at`231cr, an increase of 46.9% yoy.

ITNLs standalone revenue, representing C&EPC revenue

and fee income, witnessed a strong growth of 68% yoy to `951cr in 3QFY2013.

C&EPC revenue contributed majorly (`840.6cr) to the standalone revenue, owing

to ramp-up in execution of under-construction projects; and the balance was

contributed by fee income from Sikar-Bikaner project, Baleshwar-Kharagpur and

Kiratpur-Ner-Chowk project; and usual supervision fee from other projects underconstruction.


3/13


February 4, 2013 3

Exhibit 3:Strong execution growth in 3QFY2013


Exhibit 4:Construction income forms a major share (%)


Operational BOT projects update

During 3QFY2013, ITNLs toll collection from the Ahmedabad-Mehsana, RIDCOR

(PH. 1), Rajkot-Jetpur, Beawer-Gomti and Noida Toll Bridge grew by 5.6%, 29.8%,

23.9%, 4.2% and 16.6% on a yoy basis, respectively. However, the Vadodra-Halol

project reported a decline of 9.2% yoy in toll revenues.

Exhibit 5:Subdued growth in toll income across operational projects ( cr)

Abad Mehsana 0.17 0.16 5.6 0.17 0.0

Vadodra Halol 0.12 0.13 (9.2) 0.12 (4.8)

NoidaToll Bridge 0.25 0.22 16.6 0.23 9.1

RIDCOR (Ph 1) 0.57 0.44 29.8 0.53 6.2

Rajkot to Jetpur 0.14 0.11 23.9 0.11 27.4

Beawer Gomti# 0.05 0.05 4.2 0.05 11.1

Source: Company, Angel Research, Note: #Operational from August 25, 2010

Despite strong top-line performance; higher interest dents PAT

growth

The EBITDA margin declined sequentially by 754bp to 25.5% in 3QFY2013 vs

25.3% in 3QFY2012 and was below our estimate of 28%. This was mainly onaccount of (a) lower share of finance income, (b) higher revenue contribution from

the relatively low-margin E&C segment and (c) high input cost during the quarter.

The companys interest cost grew by 53.3% yoy to `284cr in 3QFY2013 and was

marginally above our estimate of `280cr. On the earnings front, ITNL reported

subdued growth of 18.5% yoy to `104cr (our estimate was of`108cr) on back of

higher interest cost and tax provision (40%) during the quarter.

: On a standalone basis, EBITDA margin for the quarter

stood at 14.1% in 3QFY2013 (18.6 in 3QFY2012), a decline of 455bp yoy owing

to lower share in revenues from fee income. On the earnings front, ITNL reported

a muted earnings growth of 5.8% yoy to`46.2cr on the back of lower EBIDTAMand high interest cost.

1,

093

1,

256

1,

268

1,

989

1,

580

1,

370

1,

764

(34.0)

14.9 1.0

56.8

(20.6)

(13.2)

28.8

(40)

(30)

(20)

(10)

0

10

20

3040

50

60

70

-

500

1,000

1,500

2,000

2,500

1QFY12 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13 3QFY13

Net Sales (` cr) Growth (qoq %, RHS)

69 71 71 72 68 67 70

15 15 12 13

13 1413

11 11 12 9 13 15 13

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Construction Elsamex Toll/Annuity Other


4/13


February 4, 2013 4

Exhibit 6:Fall in EBITDAM higher than expectations


Exhibit 7:Higher interest cost dents PAT growth


Order bookITNLs order book stood at `9,795.5cr (excluding L1 orders of ~`2,344.4cr), a

decline of 3% yoy, thus converting into an order book-to-sales ratio of 1.5x trailing

revenues.

Exhibit 8:State-wise order book break-up (%)


Exhibit 9:Client-wise order book break-up (%)


Equity investment of ~`1,366cr over next 3-4 years

The company has already invested ~`3,177cr in its under-development BOT

portfolio till 3QFY2013 and would require an incremental equity investment of~`1,366cr over the next three to four years. We believe it would be able to fund its

equity requirements through internal accruals from operational projects and

construction business.

331

357

321

457

466

453

450

30.328.4

25.3

23.0 29.5 33.0 25.5

-

5.0

10.0

15.0

20.0

25.0

30.0

35.0

-

50

100

150

200

250

300

350

400

450

500


EBITDA (` cr, LHS) EBITDAM (%, RHS)

116

116

88

177

122

116

104

10.6

9.3

6.9

8.9

7.7

8.5

5.9

-

2.0

4.0

6.0

8.0

10.0

12.0

-

20

40

60

80

100

120

140

160

180

200


PAT (` cr, LHS) PATM (%, RHS)

18

15

16

314

3

1

20

4

35 Himachal Pradesh

Haryana

J&K

Jharkhand

Kerala

Maharashtra

Madhya Pradesh

Meghalaya

Rajasthan

Uttar Pradesh

Andhra Pradesh

Karnataka

48%

28%

25%

NHAI Non NH AI roads Non road projects


5/13


February 4, 2013 5

Outlook and valuation

ITNLs outstanding order book currently stands at `9795.5cr (1.5x trailing

revenues), which lends decent revenue visibility over the next few years. The

company currently has L1 status in projects worth`2,344.4cr. During the quarter,

ITNLs debt to equity has also increased to 1.61x from 1.40x, and to 3.80x from

3.70x in FY2012 on a standalone and consolidated basis, respectively. We have

used sum-of-the-parts (SOTP) valuation method to arrive at the target price for

ITNL. We value the construction business at a P/E of 5x FY2014E earnings, and the

BOT projects on a DCF basis at a CoE of 14%. Also, we have valued the

international business, Elsamex, and three surface transport projects (other than

road projects) using P/BV multiple.

Exhibit 10:SOTP Valuation

ITNL's construction business Construction 289 5 1,446 74 33.1 P/E of 5x

Noida Toll Bridge Toll 545 25% 136 7 3.1 NPV at CoE of 14%

Gujarat Toll Roads Toll 765 84% 640 33 14.7 NPV at CoE of 14%

West Gujarat E'way Toll 132 100% 132 7 3.0 NPV at CoE of 14%

RIDCOR Phase-I & II Toll 981 50% 490 25 11.2 NPV at CoE of 14%

Beawar-Gomti Toll 29 100% 29 1 0.7 NPV at CoE of 14%

Pune Sholapur Toll 388 100% 388 20 8.9 NPV at CoE of 14%

Moradabad Bareilly Toll 700 100% 700 36 16.0 NPV at CoE of 14%

Chandrapur Warora Toll 220 35% 77 4 1.8 NPV at CoE of 14%

Narkatpally Addanki Toll 187 50% 94 5 2.1 NPV at CoE of 14%

Kiratpur Ner-Chowk Toll 771 100% 771 40 17.7 NPV at CoE of 14%

Sikar Bikaner Toll 162 100% 162 8 3.7 NPV at CoE of 14%

Baleshwar Kharagpur Toll 106 100% 106 5 2.4 NPV at CoE of 14%

North Karnataka E'way Annuity 140 94% 131 7 3.0 NPV at CoE of 14%

Thiruvananthapuram Phase - I & II Annuity 108 50% 54 3 1.2 NPV at CoE of 14%

AP E'way Annuity 11 100% 11 1 0.2 NPV at CoE of 14%

Hyderabad Ring Road Annuity 135 26% 35 2 0.8 NPV at CoE of 14%

East Hyderabad E'way Annuity 113 74% 84 4 1.9 NPV at CoE of 14%

Hazaribagh Ranchi E'way Annuity 104 74% 77 4 1.8 NPV at CoE of 14%

Jharkhand roads Ph-I & II Annuity 562 100% 562 29 12.9 NPV at CoE of 14%

Chenani Nashri Annuity 336 100% 336 17 7.7 NPV at CoE of 14%

Jorabat Shillong Annuity 89 50% 45 2 1.0 NPV at CoE of 14%

Elsamax 270 1.0 270 14 6.2 Valued at 1x its investment

Bus transport project 16 1.0 16 1 0.4 Valued at 1x its investment

Metro Rail Gurgaon 326 59% 194 10 4.4 Valued at 1x its investment

MP Entry Point project 203 51% 103 5 2.4 Valued at 1x its investment

Net debt (2,722) (140) (62.4) Standalone net debt



6/13


February 4, 2013 6

Exhibit 11:Angel EPS forecast vs consensus

FY2013E 26.3 27.8 (5.6)

FY2014E 29.0 29.7 (2.1)Source: Company, Angel Research

Exhibit 12:Key assumptions BOT segment

NKEL NHAI Annuity 472 75 19 94 600 101 - 499 564 Jun-02 11.0

Thiruvan. Phase 1 State Annuity 51 50 0 50 110 30 - 80 55 Jul-07 9.5

Andhra Pradesh Exp NHAI Annuity 328 49 51 100 863 34 - 829 863 Sep-06 8.6

Gujarat Toll Roads State Toll 523 84 0 84 466 232 - 234 390 Jun-00 10.0 5 5

Noida Toll Bridge State Toll 60 25 0 25 589 331 - 258 147 Dec-98 11.0

RIDCOR, Phase 1 State Toll 2106 0 50 50 1,618 100 215 1,303 809 Jan-06 11.0 #8 5

West Gujarat Exp NHAI Toll 389 49 51 100 276 40 18 218 276 Sep-05 12.8 5 5

East Hyderabad Exp. State Annuity 173 74 0 74 428 29 78 321 317 Dec-07 12.0

Beawar-Gomti State Toll 248 100 0 100 355 40 76 240 355 Oct-09 10.0 5 5

-

Jharkhand Phase 1 State Annuity 466 100 0 100 1,408 170 - 1,238 1,408 Mar-10 10.5

Thiruvan. Phase 2 State Annuity 107 50 0 50 263 125 - 138 132 Jun-09 11.0

Hazaribaug Ranchi NHAI Annuity 319 74 0 74 869 131 - 738 643 Aug-10 10.0

RIDCOR, Phase 2 State Toll 698 0 50 50 750 186 46 518 375 - 11.0 #8 5

Warora Chandrapur State Toll 275 35 0 35 700 176 176 348 245 Jan-11 11.0 5 5

Pune Sholapur NHAI Toll 571 100 0 100 1,403 160 285 958 1,403 Sep-11 11.0 8 8

Moradabad Bareilly NHAI Toll 522 100 0 100 1,984 222 443 1,319 1,984 Dec-10 11.0 5 5

Narketpalli Addanki State Toll 888 50 0 50 1,670 236 467 967 835 Jan-11 11.0 5 5

Jorbat Shillong NHAI Annuity 262 50 0 50 810 162 - 648 405 Jan-11 11.0

Chenani Nashri NHAI Annuity 38 100 0 100 3,740 748 - 2,992 3,740 May-11 10.0

Kiratpur Ner Chowk NHAI Toll 327 100 0 100 2,291 501 135 1,656 2,291 - 11.8

Sikar Bikaner NHAI Toll 540 100 0 100 803 167 247 389 803 - 11.8 5 5

Kharagpur Baleshwar NHAI Toll 477 100 0 100 654 196 - 458 196 - 11.0 5 5

Source: Company, Angel Research; #Note: Once in two years


7/13


February 4, 2013 7

Investment arguments

Market leader in the growing BOT space

ITNL is a surface transport player, with an established track record of successfullybidding, developing and operating road BOT projects on a commercial basis.

ITNL was one of the first movers in the road development segment. The company

bagged the Noida toll bridge project in 1998. Since then, it has come a long way

and has a sizeable portfolio currently. The company has one of the largest

portfolios in the country, encompassing ~12,000 lane kms. ITNLs experience and

technical capability give it an edge over competition to bid for new projects.

Pan-India presence

ITNL has 23 road projects spread across the country. The company has decent

exposure to state highways, which differentiates it from peers. The one major

advantage that state highway projects enjoy over national highways is that they

can be bundled with land, making the projects viable. Such diversification prevents

fluctuation in the companys revenue stream due to limited exposure to any one

region or project.

Hedged revenue stream

We believe ITNL has a hedged road BOT asset portfolio currently, as it is

bifurcated into toll and annuity projects in revenue terms, thereby reducing its

dependence on traffic-related revenue inflow. Going ahead as well, we expect the

company to continue to have balanced revenue, considering its projects in the

pipeline.

ITNL in a sweet spot

We believe ITNL, being a market leader, is well poised to leverage on the growing

opportunities in the BOT space, owing to 1) strong parentage (belongs to the IL&FS

Group); 2) experienced Management at the helm of affairs (rich experience of over

22 years in the infrastructure business); and 3) unique business model (present

across the value chain).

Key concerns

BOT projects are inherently high-leverage projects. Hence, ITNLs

business model is vulnerable to interest rate fluctuations and any hike in interest

rates could increase the companys interest costs.

Road players are facing pressures from the recent price inflation

in commodities such as cement and steel, which directly affect margins.

Execution delays: ITNL has faced delays in the execution of few projects

as the appointment date was not received by the NHAI due to pending

environmental clearances.

Awarding from NHAI: Any slowdown in award activity from NHAI could affectroad-focused players such as ITNL.


8/13


February 4, 2013 8

Exhibit 13:Recommendation summary

ABL 216 268 Buy 1,500 1,866 2,131 19.2 22.6 24.3 27.0 9.3 9.6 8.9 8.0 2.9CCCL 15 - Neutral 2,048 2,262 2,522 11.0 (0.5) 1.5 2.7 - - 9.8 5.5 2.2

IRB Infra 118 164 Buy 3,133 3,843 4,212 15.9 14.9 16.8 17.8 9.3 7.9 7.0 6.6 2.9

IVRCL 32 32 Neutral 6,178 4,249 6,897 5.7 0.6 0.3 3.3 136.8 55.1 105.2 9.8 5.0

JP Assoc. 80 100 Buy 12,853 13,842 15,863 11.1 4.8 3.7 4.6 (2.8) 16.5 21.8 17.5 -

L&T 1,533 1,788 Buy 53,171 60,666 69,525 14.3 64.3 63.2 75.1 8.1 23.9 24.3 20.4 2.7

NCC 45 45 Neutral 5,250 5,947 6,569 11.9 1.4 3.1 4.1 71.4 32.5 14.6 11.1 3.4

Punj Lloyd 52 - Neutral 10,557 11,892 13,116 11.5 2.8 1.8 3.2 7.8 18.6 28.5 16.0 2.3

Sadbhav 120 168 Buy 2,676 2,344 2,804 2.4 9.3 7.2 8.7 (3.5) 12.8 16.6 13.7 2.9

Simplex In. 180 251 Buy 6,010 6,906 8,053 15.8 18.1 23.2 31.3 31.7 10.0 7.8 5.7 2.4

Unity Infra 39 59 Buy 1,973 2,180 2,455 11.5 14.0 13.3 15.0 3.5 2.8 3.0 2.6 2.2


Exhibit 14:SOTP break-up

ABL 86 32 - - 182 68 - - - - 268

CCCL 16 100 - - - - - - - - 16

IRB Infra 52 32 - - 113 69 4 3 - - 164

IVRCL 17 46 - - - - 20 54 - - 37

JP Assoc. 27 27 30 30 - - - - 43 43 100

L&T 1,351 76 - - - - 437 24 - - 1,788

NCC 25 57 - - 7 16 - - 12 27 44

Punj Lloyd 64 100 - - - - - - - - 64

Sadbhav 70 41 - - 99 59 - - - - 168

Simplex In. 251 100 - - - - - - - - 251

Unity Infra 52 88 - - 7 12 - - - - 59



9/13


February 4, 2013 9

Profit & loss statement (Consolidated)

Other operating income

% chg 48.5 68.1 38.5 17.1 7.5

R.M. consumed 104 73 125 124 203 226

Construction expenses 150 528 1,790 3,051 3,610 3,866

Employee expenses 299 357 352 369 394 423

SG&A 479 651 626 595 571 607

% chg 35.7 44.5 26.9 21.8 8.2

(% of Net Sales) 36.3 33.2 28.5 26.1 27.2 27.4

Depreciation & Amortisation 35 60 61 77 102 112

% chg 33.5 48.0 27.0 21.2 8.2

(% of Net Sales) 34.2 30.7 27.0 24.8 25.6 25.8

Interest & other Charges 174 294 498 728 1,037 1,195

Other Income 107 79 79 124 149 178

(% of PBT) 21.9 15.1 11.7 15.8 18.7 22.2

Share in profit of Associates - - - - - -

% chg 7.8 28.7 16.3 1.3 1.2

Extraordinary Expense/(Inc.) 10.0 - 0.6 - - -

Tax 48.3 185.8 224.2 245.7 248.9 252.0

(% of PBT) 10.1 35.4 33.3 31.3 31.3 31.3

Add: Share of earnings of asso. (2.7) 8.7 (4.8) 3.9 3.4 (1.0)

Less: Minority interest (MI) 3.2 2.6 12.1 45.8 39.2 (12.0)

Prior period items - - - - - -

% chg - (20.2) 25.8 14.6 2.6 10.5(% of Net Sales) 26.6 14.3 10.7 8.9 7.8 8.0

% chg - (20.2) 25.8 14.6 2.6 10.5

Note: Some of the figures from FY2011 onwards are reclassified; hence not comparable withprevious year numbers


10/13


February 4, 2013 10

Balance sheet (Consolidated)

Equity Share Capital 171 194 194 194 194 194Preference Capital 35 35 35 35 35 35

Reserves & Surplus 715 1,474 2,045 2,570 2,987 3,458

Total Loans 1,854 3,322 5,467 10,219 14,019 15,719

Deferred Tax Liability 65 78 132 204 204 204

Gross Block 1,306 2,103 3,532 7,036 10,370 11,355

Less: Acc. Depreciation 263 295 365 478 580 692

Capital Work-in-Progress 8 6 3 34 34 34

Goodwill 285 271 280 527 527 527

Receivables under SCA 732 1,205 2,527 4,679 6,328 7,826

Cash 160 550 528 284 138 195

Loans & Advances 344 992 1,813 1,700 1,416 1,391

Other 915 782 895 1,071 1,175 1,173

Current liabilities 725 787 1,355 1,767 2,104 2,335

Mis. Exp. not written off - - 4 - - -



11/13


February 4, 2013 11

Cash flow statement (Consolidated)

Profit before tax 476 524 674 785 795 805

Depreciation 263 32 69 114 102 112Change in Working Capital (533) (454) (366) 348 518 257

Less: Other income (107) (79) (79) (124) (149) (178)

Direct taxes paid (48) (186) (224) (246) (249) (252)

(Inc.)/ Dec. in Fixed Assets (1,314) (795) (1,426) (3,535) (3,334) (985)

(Inc.)/ Dec. in Investments (201) (232) 239 (201) - -

Other income 107 79 79 124 149 178

Issue of Equity 171 23 - - - -

Inc./(Dec.) in loans 1,854 1,467 2,145 4,752 3,800 1,700

Dividend Paid (Incl. Tax) (25) (74) (79) (91) (91) (91)

Others (568) (64) (1,213) (2,352) (1,868) (1,670)

Inc./(Dec.) in Cash 125 390 (23) (244) (145) 56



12/13


February 4, 2013 12

Key Ratios

P/E (on FDEPS) 8.2 11.4 9.1 7.9 7.7 7.0P/CEPS 7.6 9.7 8.0 6.9 6.4 5.8

P/BV 3.8 2.3 1.7 1.4 1.2 1.1

Dividend yield (%) 0.6 1.6 1.7 2.0 2.0 2.0

EV/Sales 3.5 2.8 2.2 2.5 2.7 2.8

EV/EBITDA 9.6 8.4 7.7 9.5 10.0 10.1

EV / Total Assets 1.9 1.3 1.1 1.0 1.0 1.0

EPS (Basic) 24.6 17.7 22.3 25.6 26.3 29.0

EPS (fully diluted) 24.6 17.7 22.3 25.6 26.3 29.0

Cash EPS 26.7 20.8 25.4 29.5 31.5 34.8

DPS 1.3 3.3 3.5 4.0 4.0 4.0

Book Value 53.7 87.7 117.1 144.1 165.6 189.8

EBIT margin 34.2 30.7 27.0 24.8 25.6 25.8

Tax retention ratio 89.9 64.6 66.7 68.7 68.7 68.7

Asset turnover (x) 1.2 0.6 0.7 0.5 0.4 0.4

ROIC (Post-tax) 35.5 12.7 11.9 9.2 7.5 6.7

Cost of Debt (Post Tax) 16.9 7.3 7.6 6.4 5.9 5.5

Leverage (x) 1.8 1.7 1.9 2.9 3.9 4.3

Operating ROE 69.7 22.0 20.2 17.3 14.0 11.8

ROCE (Pre-tax) 37.4 18.0 16.4 12.9 10.8 9.7

Angel ROIC (Pre-tax) 44.1 21.3 18.7 14.0 11.4 10.1

ROE 93.8 26.2 21.8 19.6 17.0 16.3

Asset Turnover (Gross Block) 2.5 1.4 1.4 1.1 0.8 0.6

Inventory / Sales (days) 6 4 2 2 1 1

Receivables (days) 177 109 63 54 50 46

Payables (days) 135 148 117 121 131 142

Wcap cycle (ex-cash) (days) 283 230 202 178 149 133

Net debt to equity 1.8 1.6 2.2 3.5 4.3 4.2

Net debt to EBITDA 2.9 3.5 4.3 6.8 7.8 8.0

Interest Coverage 3.2 2.5 2.2 1.9 1.6 1.5



13/13


F b 4 2013 13

Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com

This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment

decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should makesuch investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies

referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and

risks of such an investment.

Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make

investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this

document are those of the analyst, and the company may or may not subscribe to all the views expressed within.

Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and

trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's

fundamentals.

The information in this document has been printed on the basis of publicly available information, internal data and other reliablesources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as thisdocument is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any wayresponsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report .Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify,nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. WhileAngel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory,compliance, or other reasons that prevent us from doing so.

This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,

redistributed or passed on, directly or indirectly.

Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or

other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in

the past.

Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in

connection with the use of this information.

Note: Please refer to the important`Stock Holding Disclosure' report on the Angel website (Research Section). Also, pleaserefer to the latest u date on res ective stocks for the disclosure status in res ect of those stocks. An el Brokin Limited and

Disclosure of Interest Statement ITNL

1. Analyst ownership of the stock No

2. Angel and its Group companies ownership of the stock No

3. Angel and its Group companies' Directors ownership of the stock No

4. Broking relationship with company covered No

Note: We have not considered any Exposure below `1 lakh for Angel, its Group companies and Directors.

Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)Reduce (-5% to -15%) Sell (< -15%)

itnl, 5th february, 2013

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