minda corporation3 investment rationale established in 1985, minda corporation is a diversified...

Initiating Coverage

Minda CorporationGetting future ready

2

Getting future ready…

Auto Ancillary

Price performance

Target Price:

CMPPotential Upside

MARKET DATA

No. of Shares

Market Cap

Free Float

Avg. daily vol (6mth)

52-w High / Low

Bloomberg

Promoter holding

FII / DII

29 Nov 2017 Company Report

BUYRs. 246

: Rs. 193: 27%

: 20.9 Cr.

: Rs. 4034 Cr.

: 27%

: 318500 shares

: 211/86

: MNDA:IN

: 70.2%

: 1.3%

Minda Corporation Ltd

Shareholding patternFinancial Summary (Consolidated)

Source: Company, Axis Securities CMP as on Nov 28, 2017

Y/EMarch

Sales(Rs Cr)

PAT (Rs Cr)

EPS (Rs)

Change (%)

P/E (x) RoE (%)RoCE(%)

EV/EBITDA DPS (Rs)

FY15 1933 90 4.3 16.1 - 21.6 21.8 - 0.4

FY16 2416 107 5.2 19.5 - 21.3 22.1 - 0.5

FY17 2931 96 4.6 (10.5) - 16.2 18.4 - 0.2

FY18E 3517 143 6.9 48.9 28.1 20.4 25.7 12.6 0.2

FY19E 4220 204 9.8 42.9 19.6 23.4 29.4 9.3 0.2

Sep-17 Q-o-Q Chg

Promoters 70.21 0.00

FPIs 1.29 1.59

MFs / UTI 5.54 (2.55)

Banks / FIs 0.25 0.02

Others 19.67 0.93

Rohit Chawla - Manager - Research | [email protected] | (+91 22 4267 1741)

50

150

250

Nov-16 Feb-17 May-17 Aug-17 Nov-17

Sensex Minda Corp

Note: The consolidated revenues and profits includes that of standalone company, subsidiaries and JVs.

3

Investment Rationale

Established in 1985, Minda Corporation is a diversified auto-ancillary company with product portfolio encompassing from

Safety Security and Restraint systems, Driver Information and Telematics Systems, interior systems for Auto OEMs across the

Globe. It caters to all key segments of PV, CV, 2/3W, Tractors, Off road vehicles as well as aftermarkets with 34

manufacturing facilities including 28 in India and 3 each in Europe and South-East Asia.

We expect revenues and earnings to grow at 20% and 46% CAGR respectively over FY17-19E driven by:

Green-field expansion at Mexico and Die Casting plant at Pune aid growth.

Turnaround in Furukawa JV, company taking steps to improve profitability.

Spark Minda Technical Centre to help company upgrade to value added system supplier and tap future opportunities.

Strong focus on increasing exports & optimizing employee costs to maintain sustainable double digit EBITDA margins.

We initiate coverage with BUY rating with a target price of Rs. 246 i.e. ~27% upside (implies 25x FY19E)

Minda Corp derived 39% of its revenues from Safety and Security systems like door handles, locksets, starter motor, etc.;

47% from Driver Information and Telematics System like wiring harness, sensors, instrument clusters, etc and 14% from

Interior systems like tooling, ash tray, cup holder, etc in FY17. In terms of end market, 31% of revenues was contributed by

2/3 wheelers, 36% from PVs, 23% from CVs and 10% from aftermarket. In FY17. 82% of the revenues come from the

domestic market and remaining from Europe and South-East Asia.

Diversified revenue streams – product and end-market wise

Company Report

Minda Corporation

Sector: Auto Ancillary

29 Nov 2017

4


Minda Corp commenced commercial operations in Die Casting plant at Pune in Q2FY18. The existing capacity is 4,600

MTPA and target capacity for FY20 would be 9,000 MTPA. Expected peak turnover is Rs 200 Cr p.a. by FY20.

Company’s green-field expansion plant in Mexico would be manufacturing plastic interior components and will cater to the

American market. Expected annual sales is Rs 175 Cr by FY20.

Greenfield expansion at Mexico and Die Casting plant at Pune to aid revenue growth

The acquisition in April 2016 has helped Minda Corp to gain exposure in Commercial vehicle, Agriculture Machinery,

Stationary Engine, Construction Equipment. Leveraging the clientele of Panalfa Autoelectrik would result in growth in CV

portfolio. Also, Minda KTSN JV with SBHAP, China would cater to CV OEMs.

Minda KTSN JV and Acquisition of Panalfa Autoelectrik to help diversify

Minda Furukawa (51% JV) posted loss in FY17; company has taken remedial steps to improve profitability and RoCE by

lowering import content and reducing royalty on many products. Minda Stoneridge (51% JV): Use of sensors will increase

dramatically (70-80 sensors vs. 20-30 currently), as OEMs increase focus on active safety norms. Minda VAST (JV 50%)

gives the company access to electronic steering column lock, door modules, latches and hinges, etc which will help in

adding substantial revenue going forward.

Turnaround in JV’s

Company Report

Minda Corporation


29 Nov 2017

5


Minda Corp would also focus on new technologies in legacy products such as PEPS, electronic clusters, 2-wheelers

electronic locks, bracket less door handles and low cost immobilizers. In non-legacy product business, it would address

Incremental demand of electronics and advanced products like EFI/EMS System, ABS, EGT/EGRT sensors, ISG, ADAS,

connected cars, soot sensors etc

Geared to tap potential growth opportunities

Minda Corp has set up ’Spark Minda Technology Centre’ in Pune to increase engineering capabilities, quality & efficiency.

It will enable the company to expand in automotive systems areas other than legacy products. Currently, various products

are under development in Electronics/ Mechatronics and going forward focus will be on autonomous, connected & electric

vehicles e.g. IoT, telematics, electric vehicle solutions etc. EI labs acquisition would help the group to expand into

Connected Mobility market and Internet of Things solutions for Automotive and other applications.

Smart Minda technology center set up and acquisition of EI labs – focus on changing technology

A strong focus on increasing export business will help in improving the margins of the company which have been hovering

near mid-to-high single digits. Through various other initiatives like employee cost optimization and margin improvement

plans in key businesses, the company aims to attain sustainable double digit EBITDA margins by FY18.

Focus on increasing exports and reduce costs

Company Report

Minda Corporation


29 Nov 2017

6

Auto industry – way forward

10%1% 4%

2%

3%

80%

31%

11%

19%

5%

9%

25%

Cars

M&HCV

UV(Incl Vans)

LCV

Tractors

2Ws

In the passenger vehicle (PV) segment, ‘value growth’ has been

much better than ‘volume growth’. In FY16/17, overall volumes

grew by 7%/9%, whereas value increased by around

10%/13% respectively.

Going forward, PV segment is expected to grow at high single

digits due to 7th pay commission payout, better rabi output, low

penetration rate of 28 cars per 1,000 people.

Commercial Vehicle (CV) segment is also expected to grow at

high single digits due to increased infrastructure thrust,

implementation of fleet modernisation programmes and higher

demand from consumption-driven sectors.

FY17 revenue breakupFY17 volume breakup

Source: SIAM, Crisil Research

Company Report

Minda Corporation


29 Nov 2017

Long term prospects remain healthy

2012-17 2017-22

OEM 4.0% 10-12%

Replacement 7.0% 8-10%

Exports 5.0% 10-12%

Growth expected across vehicle segments

2012-17 2017-22

2 wheelers 6% 11%

PVs 3% 13%

CVs -3% 8%

Tractors 1% 7%

7

Government driven regulatory push

Company Report

Minda Corporation


29 Nov 2017

Minda Corporation with its major focus on R&D and innovation is well placed to capitalize on the upcoming opportunities in the automobile industry

Electric Vehicles BS 6 emission norms Safety norms becoming mandatory

Government’s push for 100%electric vehicles by 2030augurs well for batterymanufacturers.

Structural change in theGlobal as well as IndianAutomotive industry.

Govt’s mandate to roll out BS-VI compliant vehicles fromApril 1’18 in Delhi and byApril’20 otherwise wouldbring about a lot of changesin auto and petroleum sectors.

Carmakers mandated to fit inair bags, anti-lock brakingsystem, high speed alertmechanism, reverse parkingassist and seat belt reminderin all cars produced after July,2019 to curb fatalities.

8

Group Operating Structure

Minda Corporation

Minda SaiMinda

Automotive

MindaManagement

Services

MindaFurukawa

Electric (51%)

MindaAutoelekrik Ltd

Minda KTSNPlastic Germany

Minda KTSNPlastic Poland

Minda KTSNPlastic Czech

Minda KTSNPlastic Solution

Mexico

Minda Stoneridge(51%)

Minda VAST Access System (50%)

EL Labs India Pvt Ltd

AlmightyInternational PTE,

Singapore

Minda VietnamPT Minda

Automotive Indonesia

Company Report

Minda Corporation


29 Nov 2017

Source: Company, JV % specified in parenthesis

9

Segment 1: Safety, Security and Restraint System

Companies Product Portfolio% of Sales

(FY17 )Key customers

No. of plants

Minda Corp (Stand-alone)

22.9

Bajaj Auto

TVS

Ashok Leyland

YamahaHMSI

10

Minda Vast Acess Systems

7.4

NissanM&MTata MotorsMaruti

2

PT MindaIndonesia

4.0

YamahaSuzukiKawasakiPiaggio

1

MindaVietnam

1

MindaAutoelectrik

2.7

EscortsMagnetonITLTAFECNH

1

Company Report

Minda Corporation


29 Nov 2017

10

About companies in Segment 1

Companies Description Outlook

Minda Corporation(Standalone)

Minda Corporation has set up its third die castingplant to set up future demand from customers.

It has also set up Spark Minda Technical centre(SMIT) to develop various products inElectronics/Mechatronics area.

Developing products which meet the changingemission regulations i.e. BS VI

Entry into new vehicle segments mainly construction& agriculture vehicles.

Minda VAST 50% JV, One of the global market leaders in the

security /access systems.

Innovations to offer typical Indian solutions to the endusers on affordable cost as conventional mechanicalbased security systems would be replaced withelectronics additions

ASEAN Business Established local manufacturing facilities in

Indonesia and Vietnam

Exploring an entry strategy into 4 wheeler market Focusing on Wiring Harness business with major 2

Wheeler OEMs Exploring entry into new market of Thailand for

wiring harness.

Minda Autoelectrik One of the few companies to introduce Offset gear

reduction in Tractor segment in India.

First to introduce offset gear reduction in 1 KW isscheduled in FY2017-18

Entry into new segments viz., Stationary Engines andCV Segment

Focus on reducing high raw material cost

Company Report

Minda Corporation


29 Nov 2017

11

Segment 2: Driver, Information and Telematics System


(FY17)Key customers

No. of plants

Minda SAI 18.7

M&MHMSITVSAshok LeylandHero Moto Corp

9

MindaFurukawa 14.9

Maruti SuzukiRenault-NissanHonda

4

MindaStoneridgeInstruments

9.2

HMSIAshok LeylandBajaj AutoM&M

2

Company Report

Minda Corporation


29 Nov 2017

12

Segment 3 : Interior System


(FY17)Key customers

No. of plants

Minda KTSN(Germany)

12.3

VW Group (Audi &

Porsche Group) BMW Daimler

4

Minda KTSN(Poland)

Minda KTSN(Czech Republic)

Minda KTSN(Mexico)

Company Report

Minda Corporation


29 Nov 2017

13

About companies in Segment 2 and Segment 3

Companies Description Outlook

Minda SAI

Engaged in manufacturing of automotivecomponents such as Instrument Clusters, DashboardClocks, Fuel Level Sensors, Dashboard Assemblies,Speed Sensors and Temperature Sensors.

As the pressure on wiring harness will be more dueto regulatory changes and customer needs, focus willbe on automobile networking, wireless sensors etcfrom architectural point of view and alternateconductors for cables from component point of view

Minda Furukawa

51:49 joint venture between Minda Corporation andFurukawa of Japan. The Company develops andproduces the entire range of wiring harness forJapanese four wheelers customers and componentsrelated to wiring harness

Lowering import content and reducing royalty onmany products

Focus on products surrounding Airbag/ABSMandate/Euro VI Norms/IoT/Connected Cars

Minda Stoneridge

51:49 joint venture between Minda SAI Ltd andStoneridge Inc, USA a leading manufacturer ofElectronics instruments

Address shift from mechanical to electronicsexpected in 2W after BS VI gets introduced in 2020as well as increasing use if sensors

Minda KTSN

Minda KTSN is focused on interior plastic productswhich are relatively lighter in weight and takes lesserspace in vehicles.

Focus on North America, China and Indianautomotive markets for its plastic interior products.

Tap global market which is a big opportunity for thecompany

Company Report

Minda Corporation


29 Nov 2017

As of Q2FY18, the company has booked orders worth lifetime value of Rs. 1200 Cr across all 3 segments (Rs. 600 Cr in Safety, Security and Restraint system, Rs. 360 Cr in Driver information and Telematics system and Rs. 240 Cr in Interior system).

14

Aftermarkets segment of Minda Corporation

Companies Product Portfolio % of Sales

MindaAutomotive Solutions

8% of Total Revenues

Company Report

Minda Corporation


29 Nov 2017

The Minda Automotive Solutions Limited (MASL) is the Group's specialist auto component distribution and servicingCompany with a countrywide distribution network of about 350 dealers covering the 2w & 4w business segments.MASL is also in the process of spreading its wings outside India to address the growing global replacement market for its

range of products.

15

Revenue classification

FY17 Revenue break -up

Minda Corp is a diversified player, key segmentsbeing Safety Security & Restraint system, DriverInformation & Telematics system, Interior systems

It also a low client concentration risk with Maruticontributing highest to the extent of 10-11% .

Source: Company, Axis Securities

22.9%

18.7%

14.9%

12.3%

9.2%

7.8%

7.4%4.0%2.7%

Minda Corp

Minda SAI

Minda Furukawa

Minda KTSN

Minda Stoneridge

Minda Automotive

Minda VAST

ASEAN

Minda Autoelektrik

38.6%

47.5%

14.0%Safety, security andRestraint system

Driver Information andTelematics system

Interior Systems

FY17 Revenue segment wise FY17 Revenue end market wise FY17 Revenue location wise

PVs and 2/3 wheelers constitute 65-70% withMinda Corp supplying to major OEM’s

Minda Corp’s revenue contribution fromCommercial and Off-Highway vehicles hasincreased from 18% in FY15 to 23% in FY17.

Minda Corp mainly has domestic presence;India revenues have increased from 71% inFY15 to 82% in FY17.

Greenfield expansion at Mexico and Punewill boost export sales.

31%

23%

36%

10% 2/3 wheelers

Commercial & OffHighway vehiclesPassenger vehicles

After Market

82%

14%4% India

Europe

South-EastAsia

Minda Corp standalone contributed23% of the revenues, rest was spreadacross JVs and subsidiaries in all thethree products segments

With a dedicated management, thecompany has revenue and marginimprovement plans for everysubsidiary and JV, thus we expectrobust growth growing forward

The company has done manygreenfield expansions andacquisitions in last 2 years, which willreflect in numbers in the coming years

Company Report

Minda Corporation


29 Nov 2017

16

Triggers: Green-field expansion to boost growth

DIE CASTING PLANT AT PUNE

Minda Corp. has set up its third die casting plant atPune which is expected to increase its productioncapacity from 4,600 to 9,600 MTPA by FY20E.The plant will be exclusively used for aluminium

gravity & low pressure die casting with machining. It will also have separate machine shop with focus

on precision parts such as Compressor Housing.The plant has been built with a capital investment of

Rs.100 Cr, most of which is already done andexpected annual sales of Rs 200 Cr by 2019-20.Total order booked is Rs 160 Cr per annum.The plant has commenced operations in Q2FY18.

MINDA KTSN: PLANT AT MEXICO

In Mexico, Minda KTSN has inaugurated the newplant for plastic interiors with a capital investmentof Rs. 100 Cr and expected annual sales from ofRs. 175 Cr by FY20.The company has received orders for

manufacturing of parts which include Glove box,St. Column, End Cap, Hang on parts and others.Current order book stands at Euro 2.5 Cr p.a.The plant commenced commercial production in

Q1 FY18

These two plants would start contributing from Q2FY18; giving an additional fillip to the revenues of the company.

Company Report

Minda Corporation


29 Nov 2017

17

Triggers: Strategic tie-ups to increase new offerings

MINDA KTSN JV WITH SBHAP, CHINA

Minda Corp subsidiary Minda KTSN has set up a50:50 joint venture with SBHAP, China (a BAIC groupsubsidiary) in August 2016 for products like Plastic oilpans and cylinder head, along with other plasticunder-bonnet/interior parts.

The target customers would be CV OEMs such asDaimler, Foton etc having manufacturing plants inChina

The construction is expected to be completed inFY2017-18

ACQUISITION OF PANALFA AUTOELECTRIK

In April 2016, MCL acquired Panalfa Autoelektrik(Haryana) which is now renamed as MindaAutoelektrik Ltd.

It primarily manufactures reduction gear, startermotors and alternators and caters to CommercialVehicles, Agriculture Machinery, ConstructionEquipment and Automotive market globally.

Key customers of Panalfa Autoelektrik (PAL) includeEicher, Escorts, Greaves, HMT, Magneton,NewHolland, Polaris, Sonalika and TAFE.

We expect the company to further leverage theclientele of PAL leading to healthy growth in CVportfolio.

Acquisitions and JVs will help in enhancing the product portfolio as well asentering in different segment, thus enabling diversification

Company Report

Minda Corporation


29 Nov 2017

18

Triggers: Getting future ready – Key opportunities

Smart Minda Technical Centre (SMIT), Pune

SMIT would be instrumental in moving MCL up in the valuechain from component supplier to value added system suppliersin terms of products and solutions It would help build up the products for the automotive

mechatronics engineering use.

Potential growth opportunities

EFI/EMS Systems, ABS andCBS, EGT/EGRT Sensors,ISG, ADAS, connected cars,PM Sensors / Soot, BodyControl Modules etc

PEPS, Electronic Clusters, 2-Wheeler electronic locks,Bracketless Door Handles & LowCost Immobilizer

New Vehicle Segment (eg.Off-road vehicles) andEmerging Future Segments(egelectric vehicles). SteeringRoll Connector (SRC) salesexpected to increase with airbags becoming mandatory innear future

Strong focus on increasingexport business and expandingoverseas operations, resulting inincrease in margins. Totalexports expected to reach Rs500 Cr by FY20.

Company Report

Minda Corporation


29 Nov 2017

Acquisition of EI labs

EI Labs bagged prestigious business under Govt. of India EESL – to source 10,000 electric vehicles.We believe with Minda Corp well placed on technological front, it s future ready with upcoming disruptions

The company acquired EI Labs India Pvt Ltd in Aug’17 The acquisition will help the company expand in Connected

mobility market and Internet of Things solutions for automotiveand other applications.

19

Strong Financial Outlook

Return ratios

Source: Company, Axis Securities Ltd.

Consolidated Revenues Margins trend

(Rs.

Cr.

)

Gross Block and Asset Turnover Trends

Company Report

Minda Corporation


29 Nov 2017

Revenues and margins togrow led by greenfieldexpansions, increasedfocus on exports and costreduction, turnaround inFurukawa, strong orderbook, and addition ofnew customers, productsand geographies.

0

0.5

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1.5

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2.5

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1200

1400

1600

FY14 FY15 FY16 FY17

Gross Block Fixed Asset Turnover

Return ratios to improvewith company’s increasedfocus on marginimprovements. Thecompany’s fixed assetturnover has improvedover the years and weexpect similar trend tocontinue going forward.

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5%

10%

15%

20%

25%

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FY14 FY15 FY16 FY17 FY18E FY19E

RoE RoCE

7.9%9.4% 9.2%

6.8%

9.3%10%

4.8% 4.6% 4.4%3.3%

4.1%4.8%

0%

2%

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12%


EBITDA(%) NPM (%)0

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4,500


20

Valuation Charts

Source: Company, Axis Securities

12mth fwd P/E (x)

Valuation

We estimate Minda Corp to post revenues at a CAGR of20% and profits at 46% over FY17-FY19E

Minda Corporation is well positioned in the industry owingto high entry barriers and being a diversified player in autoancillary industry, strong brand name, sticky clientele,acquisitions and JVs contributing to top-line as well asbottom-line, strong management, and thus deserves premiumvaluations.

We value Minda Corp. at 25x FY19E given the growthprospects to arrive at a target price of Rs 246 (27% upside)

One year Fwd P/E band

Key Risks and Concerns

Company has operations in many countries and is prone tothe currency fluctuations due to exports-imports transactions.

Unexpected uncertainties and volatilities in Europe andASEAN may have an adverse impact on profitability.

Minda Corp. manufactures different auto components thatneed continuous technological upgradation.

The Company purchases raw materials for variousmanufacturing processes which are prone to price fluctuationin global markets..

Company Report

Minda Corporation


29 Nov 2017

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21

Financials (Consolidated)

YE March FY15 FY16 FY17 FY18E FY19E

Net sales 1,933 2,416 2,931 3,517 4,220

Other operating income 37 30 32 368 45

Total income 1,971 2,446 2,962 3,554 4,265

Cost of goods sold 1,712 2,130 2,650 3,096 3,681

Contribution (%) 11.4% 11.8% 9.6% 12.0% 12.8%

Advt/Sales/Distrn O/H 76.6 92.1 113.7 131.3 157.6

Operating Profit 182 223 198 327 427

Other income 23 17 46 25 425

PBIDT 204 241 244 352 452

Depreciation 60 74 85 93 99

Interest & Fin Chg. 36 33 41 46 48

E/o income / (Expense) 2 14 (18) 0 0

Pre-tax profit 111 147 100 213 305

Tax provision 27 37 33 70 100

(-) Minority Interests (1) 3 (29) 0 0

Associates 4 0 0 0 0

Adjusted PAT 88 97 108 143 204

Reported PAT 89.5 107.3 96 143 204


Total assets 963 1,126 1,277 1,436 1,661

Net Block 570.8 718.7 763.2 775.0 746.1

CWIP 15.3 13.1 82.3 45.0 30.0

Investments 28.9 5.2 5.2 5.2 5.2

Wkg. cap. (excl cash) 304 300 370 483 577

Cash / Bank balance 44.1 88.2 57.0 127.9 303

Misc. Assets 0.0 0.0 0.0 0.0 0.0

Capital employed 963 1,126 1,277 1,436 1,661

Equity capital 41.5 41.6 41.6 41.6 41.6

Reserves 406 507 590 728 927

Pref. Share Capital 19.2 19.2 19.2 19.2 19.2

Minority Interests 24.1 63.7 35.0 35.0 35.0

Borrowings 466 483 581 601 626

Def tax Liabilities 5.7 11.3 10.7 11.5 12.0

Profit & Loss (Rs Cr) Balance Sheet (Rs Cr)

Company Report

Minda Corporation


29 Nov 2017

Source: Company, Axis SecuritiesNote: The consolidated revenues and profits includes that of standalone company, subsidiaries and JVs.

22

Financials (Consolidated)


Sources 54 338 173 252 324

Cash profit 180 218 193 282 351

(-) Dividends 10 13 5 5 5

Retained earnings 170 205 188 277 346

Issue of equity 21.2 0.1 0.0 0.0 0.0

Change in Oth. Reserves 1.9 45.5 (37.2) 0.0 0.0

Borrowings (44) 14 96 20 25

Others (95) 73 (74) (45) (47)

Applications 54 338 173 252 324

Capital expenditure 50.3 324.8 170.0 67.7 55.0

Investments 4.4 (23.7) 5.0 0.0 0.0

Net current assets 15.8 (10.1) 58.3 113.4 93.6

Change in cash (16.6) 46.9 (60.6) 70.8 175.2


Sales growth 21.3 25.0 21.3 20.0 20.0

OPM 9.2 9.1 6.7 9.2 10.0

Oper. profit growth 44.6 22.9 (11.3) 65.3 30.3

COGS / Net sales 88.6 88.2 90.4 88.0 87.2

Overheads/Net sales 4.0 3.8 3.9 3.7 3.7

Depreciation / G. block 5.8 5.5 5.9 6.0 6.1

Effective interest rate 21.0 8.5 7.6 7.4 8.1

Net wkg.cap / Net sales 0.14 0.12 0.10 0.11 0.12

Net sales / Gr block (x) 1.9 1.8 2.0 2.3 2.6

RoCE 21.8 22.1 18.4 25.7 29.4

Debt / equity (x) 0.95 0.81 0.85 0.73 0.61

Effective tax rate 24.5 25.0 32.9 32.9 32.9

RoE 21.6 21.3 16.2 20.4 23.4

Payout ratio (Div/NP) 11.3 11.7 5.2 3.5 2.5

EPS (Rs.) 4.32 5.16 4.62 6.88 9.83

EPS Growth 16.1 19.5 (10.5) 48.9 42.9

CEPS (Rs.) 7.2 8.7 8.7 11.4 14.6

DPS (Rs.) 0.4 0.5 0.2 0.2 0.2

Cash Flow (Rs Cr) Ratio Analysis (%)

Company Report

Minda Corporation


29 Nov 2017

Source: Company, Axis SecuritiesNote: The consolidated revenues and profits includes that of standalone company, subsidiaries and JVs.

23

Disclaimer

Disclosures:

The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).

1. Axis Securities Ltd. (ASL) is a SEBI Registered Research Analyst having registration no. INH000000297. ASL, the Research Entity (RE) as defined in the Regulations, is engaged in the business ofproviding Stock broking services, Depository participant services & distribution of various financial products. ASL is a subsidiary company of Axis Bank Ltd. Axis Bank Ltd. is a listed publiccompany and one of India’s largest private sector bank and has its various subsidiaries engaged in businesses of Asset management, NBFC, Merchant Banking, Trusteeship, Venture Capital,Stock Broking, the details in respect of which are available on www.axisbank.com.

2. ASL is registered with the Securities & Exchange Board of India (SEBI) for its stock broking & Depository participant business activities and with the Association of Mutual Funds of India (AMFI) fordistribution of financial products and also registered with IRDA as a corporate agent for insurance business activity.

3. ASL has no material adverse disciplinary history as on the date of publication of this report.

4. I/We, Rohit Chawla – Manager, Research, MBA (Finance), author/s and the name/s subscribed to this report, hereby certify that all of the views expressed in this research report accuratelyreflect my/our views about the subject issuer(s) or securities. I/We (Research Analyst) also certify that no part of my/our compensation was, is, or will be directly or indirectly related to the specificrecommendation(s) or view(s) in this report. I/we or my/our relative or ASL does not have any financial interest in the subject company. Also I/we or my/our relative or ASL or its Associates mayhave beneficial ownership of 1% or more in the subject company at the end of the month immediately preceding the date of publication of the Research Report. Since associates of ASL areengaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject company/companies mentioned in thisreport. I/we or my/our relative or ASL or its associate does not have any material conflict of interest. I/we have not served as director / officer, etc. in the subject company in the last 12-monthperiod.

Any holding in stock – No

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6. In the last 12-month period ending on the last day of the month immediately preceding the date of publication of this research report, ASL or any of its associates may have:

i. Received compensation for investment banking, merchant banking or stock broking services or for any other services from the subject company of this research report and / or;ii. Managed or co-managed public offering of the securities from the subject company of this research report and / or;iii. Received compensation for products or services other than investment banking, merchant banking or stock broking services from the subject company of this research report;

ASL or any of its associates have not received compensation or other benefits from the subject company of this research report or any other third-party in connection with this report.

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This report has been prepared by ASL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be altered inany way, transmitted to, 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 ASL. The report is based on thefacts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in nature. The information is obtained from publicly availablemedia or other sources believed to be reliable. Such information has not been independently verified and no guaranty, representation of warranty, express or implied, is made as to its accuracy,completeness or correctness. All such information and opinions are subject to change without notice. The report is prepared solely for informational purpose and does not constitute an offer documentor solicitation of offer to buy or sell or subscribe for securities or other financial instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive thisreport at the same time. ASL will not treat recipients as customers by virtue of their receiving this report.

Company Report

Minda Corporation


29 Nov 2017

24

Disclaimer

Disclaimer:

Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to the recipient’s specific circumstances.The securities and strategies discussed and opinions expressed, if any, in this report may not be suitable for all investors, who must make their own investment decisions, based on their owninvestment objectives, financial positions and needs of specific recipient.

This report may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this report should make such investigations as it deems necessary to arrive atan independent evaluation of an investment in the securities of companies referred to in this report (including the merits and risks involved), and should consult its own advisors to determine the meritsand risks of such an investment. Certain transactions, including those involving futures, options and other derivatives as well as non-investment grade securities involve substantial risk and are notsuitable for all investors. ASL, its directors, analysts or employees do not take any responsibility, financial or otherwise, of the losses or the damages sustained due to the investments made or anyaction taken on basis of this report, including but not restricted to, fluctuation in the prices of shares and bonds, changes in the currency rates, diminution in the NAVs, reduction in the dividend orincome, etc. Past performance is not necessarily a guide to future performance. Investors are advice necessarily a guide to future performance. Investors are advised to see Risk Disclosure Documentto understand the risks associated before investing in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are not predictions andmay be subject to change without notice.

ASL and its affiliated companies, their directors and employees may; (a) from time to time, have long or short position(s) in, and buy or sell the securities of the company(ies) mentioned herein or (b)be engaged in any other transaction involving such securities or earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein oract as an advisor or investment banker, lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other related informationand opinions. Each of these entities functions as a separate, distinct and independent of each other. The recipient should take this into account before interpreting this document.

ASL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report should be aware that ASLmay have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific merchant banking, investment banking orbrokerage service transactions. ASL may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.

Neither this report nor any copy of it may be taken or transmitted into the United State (to U.S. Persons), Canada, or Japan or distributed, directly or indirectly, in the United States or Canada ordistributed or redistributed in Japan or to any resident thereof. If this report is inadvertently sent or has reached any individual in such country, especially, USA, the same may be ignored and broughtto the attention of the sender. 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 otherjurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject ASL to any registration or licensing requirement within suchjurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors.

The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and should not be treated as endorsement of the views expressed in the report. TheCompany reserves the right to make modifications and alternations to this document as may be required from time to time without any prior notice. The views expressed are those of the analyst(s)and the Company may or may not subscribe to all the views expressed therein.Copyright in this document vests with Axis Securities Limited.

Axis Securities Limited, Corporate office: Unit No. 2, Phoenix Market City, 15, LBS Road, Near Kamani Junction, Kurla (west), Mumbai-400070, Tel No. – 18002100808/022-61480808, Regd. off.- Axis House, 8th Floor, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400 025. Compliance Officer: Anand Shaha, Email: [email protected], Tel No: 022-42671582. SEBI-Portfolio Manager Reg. No. INP000000654

Company Report

Minda Corporation


29 Nov 2017

minda corporation3 investment rationale established in 1985, minda corporation is a diversified...

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