research team october 30, 2018 · 2018-11-08 · hdfc bank provides a number of products and...

Research Team October 30, 2018

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The Repugnant Paradox and intertwined play between large and small companies. Financial markets in India are going through major upheavals in recent past with enhanced volatilities and signs of instabilities. After hitting new

high in August 2018, the bellwether equity indices have corrected during September. One year return on large cap indices have dropped to lowteens, mid-caps to zero and small caps to negative. In the bond market, yield on benchmark ten year government security has breached 8%mark for the first time since February 2016.

India’s quarterly current account deficit has increased to $16 billion or 2.4% of GDP. Exchange rate of Indian rupee has fallen to ₹73 per dollarfrom 65.5 at the earlier part of the year. The events in the financial market is presently not influenced by considerable acceleration of growth(GDP, industrial production, infrastructure), softening of inflation (both core and non-core), acceleration of bank credit and deposit rates,better fiscal performance by the central government versus the last year and buoyant FDI inflows in excess of $60 billion a year. The net FIIequity inflow remained negative for the fiscal year at $7.2 billion.

Parts of the problems in India are induced by external events. Tight demand-supply situation for crude oil due to inter alia output ceilings byOPEC, rising oil demand, supply losses in Venezuela and elsewhere and impending implementation to of embargo against Iranian oil exportshave pushed up Brent oil prices from $50 a barrel in August 2017 over $80 a barrel currently.

With nearly 90% of Indian crude requirement being imported, high crude oil prices has been a key reason for the widening of India’s trade andcurrent account deficits and pressure of depreciation on rupee. Apart from oil, rising gold and electronic imports are impacting India’s externalbalance. Government has now increased import duty on many items to control it.

We remain confident that with rapid technological progress and falling costs of renewable and other alternative energy sources, crude oil priceswould correct significantly in the medium to long term. Yet, in the near-term oil prices may remain elevated especially in the run-up to start ofoil export embargo on Iran.

Government measures to increase import duties on a large range of electronic and other consumer items are also likely bring down trade andcurrent account deficits substantially. Government measures to increase corporate bond investment limits for foreign portfolio investors,removal of withholding duty for non-residents on masala bonds, reduction of maturity period for low-ticket external commercial borrowing byIndian manufacturing companies are likely to boost capital inflows.

Also, the recent concluded currency swap deal between India and Japan for $75 billion; This New Swap Agreement should aid in bringinggreater stability to foreign exchange and could come handy at allaying fears that India has insufficient cushion to finance current account deficit(CAD) if the situation demands. Overall, rupee is likely to consolidate in the next couple of quarters and appreciate moderately in the next 12months.

On GST front, the collections improved in September to ₹94.4 billion; the government has continuously remained accommodative and open todiscussions keeping interests of industries in mind and has implemented changes accordingly. The GST council has met 30 times and took 918decision so far which should also usher in further positive impact in the economy. Moreover, sharp increase in government revenue from oilproducts would also improve the fiscal situation at both centre and state levels. Overall, despite the unfavourable financial marketdevelopments in the recent past and widespread concerns, we remain confident about the long term outlook for both the economy andfinancial markets.

Diwali Picks 2018

Script NameCMP as on 06-Oct-17

Target Price

Upside Potential

Market Cap. (₹Bn.)

PE/PB(FY19E)

Rationale/Description

Asian Paints Lt. 1,195 1,471 23% 1,146 52.1

Increase in pace of urbanization, high infra spend, and shift from un-organized to organized to remain key drivers.APNT being the market leaders and vast distribution network is best poised to gain leverage amongst peers.

HDFC Bank Ltd. 1,924 2,420 26% 5,229 3.8

Capital constraints in public sector banks to provide an opportunity to the private banks to increase market share and outperform in banking & financial services space.

L&T Technology Services Ltd.

1,669 2,042 22% 174 28.6

Increased pace of digital adoption in the manufacturing and other sectors promises larger & agile digital solutions from the companies.LTTS being one of the players offering customised solutions for its clients stands to benefit from global growth in demand.

JSW Steel Ltd. 340 406 19% 822 10.0

Better realisation, improving domestic market in steel sector, higher demand from infra sector are positive followed by increase in capacity by FY-20 and better operational matrix to lower costs.

SundramFasteners Ltd.

521 760 46% 110 22.7

The Company is significantly adding capacity and has incurred ~Rs.2000-3000mn capital expenditure in FY18.

Indraprasth Gas Ltd.

251 319 27% 176 17.3

Environmental concerns in Delhi have brought to the fore the urgency of using cleaner fuels, which puts IGL in a sweet spot.

4

L&T Technology Services Limited (LTTS) CMP: 1,669Target: 2,042

52 Week Low / High 805 / 1855

Avg. Daily Volume 90 Day (‘000) 163

No. of Shares O/S (Mn.) / Mkt. Cap (₹Bn.) 104 / 173

Shareholding (Promoters/Institutional/Others) 80.7% / 8.2% / 11.1%

Price Performance (Oct’17=100)

Source: Company, Anand Rathi Research. Note: Prices are as on 29th Oct-18.

Rationale: L&T Technology Services Limited (LTTS) is one of the three listed

subsidiaries of Larsen & Toubro Ltd. The company provides design anddevelopment solutions to clients across the entire value chain of productdevelopment. These includes solutions in the areas of mechanical andmanufacturing engineering, embedded systems, software engineering andprocess engineering.

For new-age technologies, it provide services and solutions in the areas ofproduct lifecycle management, engineering analytics, power electronics,M2M connectivity and IoT.

The company’s primary revenues comes from North America regionfollowed by Europe and in terms of business vertical, the transportationcontributes around 1/3rd to revenues followed by Telecom & Hi-Tech,Industrial products, Process Industry & Medical Devices at 29%, 20%,13.5% and 6.5% respectively.

During the latest quarterly results, the company has reported robustgrowth in revenues, it grew 27.1% in Q2-FY19 to $177.2 million as against$168.9 million in Q2-FY18. The operating margins for the company stood18.1% at ₹2,289 million against 17% in Q2-FY18 and PAT margins at 15.1%to ₹1,910 million against 17.1% in Q2-FY18.

On segment basis the company has been performing well in almost all thesegment with each growing at more than 20% growth rates in Q2-FY19YoY basis except Industrial Products segment growing at ~10.8% andMedical Devices segment growing at 18.4% during the quarter.

On guidance front, the management has guided of achieving 20% plusgrowth in revenues for the current year with strong growth coming fromall the major segments while maintaining margins at currents levels.

With the rise of enabling technologies like 5G, IoT, Artificial Intelligenceetc, the digital disruption now has expanded to almost each and every partof the global industrial complex including manufacturing and processindustries. This has opened a new and bigger opportunity of more than$1.1 trillion market for engineering outsourcing market.

We believe LTTS is one of the better placed company with significantexposure to this market providing better growth prospects for thecompany.

At CMP the stock is trading at 28.6x FY19E and 23.7x FY20E earnings. Werecommend BUY on the stock with a target price of ₹2,042 per share.

(In ₹ mn) FY-17 FY-18 FY-19E FY-20E

Total Income 33,277 39,532 48,953 56,969

EBITDA 6,438 7,690 8,122 9,737

EBITDA Margin 19.3% 19.5% 16.6% 17.1%

PAT 4,250 5,066 6,046 7,292

PAT Margin 12.8% 12.8% 12.4% 12.8%

EPS (₹) 41.0 48.9 58.3 70.4

Debt/Equity 0.00 0.00 0.00 0.00

P/B 10.3 7.9 7.0 5.4

RoE 29.2% 26.9% 24.3% 22.7%

EV/Sales 6.0 5.1 4.1 3.5

P/E 35.1 29.4 28.6 23.7

90

120

150

180

210

240

LTTS Nifty 500

5

HDFC Bank Limited (HDFCBANK) CMP: 1,924Target: 2,420


52 Week L/H 1,788 /2,220

Avg. Daily Volume 90 Day (‘000) 3,088

No. of Shares O/S (Mn.) / Mkt. Cap (₹Bn.) 2,717 /5,332

Shareholding (Promoters/Institutions/Others) 27%/54%/19%

Source: Company, Anand Rathi Research, Consensus Estimates. Note: Prices are as on 29th Oct-18.

Rationale:

HDFC Bank Limited is an Indian banking and financial services companyheadquartered in Mumbai, Maharashtra. It has 88,253 permanentemployees as on 31 March 2018 and has a presence in Bahrain, HongKong and Dubai. HDFC Bank is India’s largest private sector lender byassets.

HDFC Bank provides a number of products and services includingwholesale banking, retail banking, treasury, auto loans, two wheeler loans,personal loans, loans against property, consumer durable loan, lifestyleloan and credit cards.

HDFC Bank reported steady Q2FY19 operational performance. NIMexpanded ~10 bps QoQ and was flat YoY at 4.3%. Core fee income growthat 26% YoY continued to remain strong deriving strength from retail feesincluding cards, third-party insurance, other retail and cash management.

Bank has continued to gain market share in key businesses led by digitalsourcing and deeper penetration improving product delivery and costcontrol which has led the bank to reach historic low C/I of 39.9% inQ2FY19.

The management also stated that their pilot experiment of virtual RM,which targeted 1.5mn customers, has witnessed a healthy lift in revenueper customer. They are planning to scale up this platform and target 6mnodd customers. Capacities are in place and investments have been madein people in the past 1 year. This will yield results in coming years.

Capital constraints in public sector banks will provide an opportunity tothe private sector banks to increase their market share and outperform inbanking & financial services space.

HDFC Bank has raised Rs240bn of fresh equity in H1FY19, which willsupport its loan growth in the coming years.

Further, we expect HDFC Bank to be a major gainer of the current crisis inthe NBFC space as it has best-in-class liability franchises along withsuperior customer outreach across business segments.

Backed by the robust underwriting skills & prudence and the consistenttrack record of growth and profitability, HDFC Bank Limited is our top pickamongst the private sector banks.

At CMP the stock is trading at 3.8x FY19E book value and 3.1x FY20E bookvalue. We recommend BUY on the stock with a target price of ₹2,420 pershare.

(In ₹Mn) FY-17 FY-18 FY-19E FY-20E

Interest Income 3,31,392 4,00,949 4,66,190 5,60,605

PAT 1,45,497 1,74,868 2,15,177 2,71,503

EPS (₹) 57.2 67.8 79.2 99.9

P/E (x) 34.4 29.0 24.4 19.3

Price/BV 5.5 4.7 3.8 3.1

RoE 20.63% 21.03% 21.72% 22.51%

90

100

110

120

130

HDFCB Nifty 500

6

Asian Paints Limited (ASIANPAINTS) CMP: 1,195Target: 1,471



Rationale: Asian Paints is India’s leading paint company and Asia’s third largest paint

company, with a group turnover of ₹169 billion. Asian Paints operates in16 countries and has 25 paint manufacturing facilities in the worldservicing consumers in over 65 countries. Besides Asian Paints, the groupoperates around the world through its various subsidiaries BergerInternational Limited, Apco Coatings, SCIB Paints, Taubmans, Kadisco andCauseway.

The company has to its credit a leadership position in its market, proventrack record of adapting to changes in market conditions, a professionalmanagement, history of innovative strategies in marketing, efficientmanufacturing and logistics in place and prudent financial management.

In terms of business segments, the company operates primarily into threesegments namely Decorative paints, International Paints, Industrial paints& coatings and Home and Improvement. The decorative segmentcontributes almost 76% to APNT’s top line followed by Internationalbusiness at 12%, Industrial at 9% and remaining 2% by Home &Improvement.

In its latest financial results, APNT has reported a growth of 8.8% inrevenues at ₹46,391 million in Q2-FY19 as against ₹42,652 million in Q2-FY18. The growth was muted in the quarter as last year correspondingquarter was buoyant due to subdued Q1-FY18 post GST.

In terms of margins, the operating margins for the company stood at16.9% at ₹7,842 million in Q2-FY19 as against ₹8,011 millions in Q2-FY18.PAT margins for the company stood 9.5% at ₹4,430 millions in Q2-FY19 asagainst ₹6,204 million in Q2-FY18. The decline in margins was due toeffect of higher raw material prices owing to higher crude oil prices.During the quarter the company has taken a price hike of 2.35% to negatethe same.

In terms of growth, we continue to expect Indian paints industry to growat around 8%-12% in next few years and demand factors remain strong interms of growth, concerns remain in terms of raw material costs mainly onaccount crude oil which we believe is gradually declining due to increasein share of water based paints going ahead.

At CMP the stock is trading at 52.1x FY19E earnings and 42.3x FY20Eearnings respectively. We recommend a BUY on the stock with a targetprice of ₹1,471 per share.

90

100

110

120

130

Oct-17 Dec-17 Feb-18 Apr-18 Jun-18 Aug-18 Oct-18

ASIANPAINTS Nifty 500

52 Week L/H 1090 / 1491

Avg. Daily Volume 1,038


Shareholding (Promoter/Institution/public) 52.8% /26.2% /21%


Total Income 1,56,590 1,71,753 1,89,576 2,18,447

EBITDA 32,867 34,952 34,671 42,355

EBITDA Margin 21.0% 20.4% 18.3% 19.4%

PAT 19,666 20,517 22,018 27,113

PAT Margin 12.6% 11.9% 11.6% 12.4%

EPS (₹) 20.5 21.4 23.0 28.3

Debt/Equity 0.0 0.1 0.1 0.0

P/B 15.1 13.6 10.8 8.6

RoE 25.9% 24.4% 20.7% 20.4%

EV/Sales 7.3 6.7 6.1 5.3

P/E 58.3 55.9 52.1 42.3

7

Sundram Fasteners Limited (SUNDRMFAST)

Rationale:

Started in 1966, Sundram Fasteners Limited has grown into a globalleader, manufacturing critical, high precision components for theautomotive, infrastructure, windmill and aviation sectors.

The company’s varied range of products encompasses fasteners,powertrain components, sintered metal parts, iron powder, cold extrudedparts, radiator caps and wind energy components

An unwavering focus on delivering quality has won Sundram FastenersLimited the trust of both OEM and aftermarket customers in highlycompetitive markets like India, China, Germany, USA, UK, Italy, France &Brazil

The company reported healthy results for the quarter ending June-18.Revenue from operations improved by 22.4% year-on-year to Rs. 9,710million. The export sales for the Quarter ended were at Rs.3217 million asagainst Rs.2880 million during the same period in the previous year, anincrease of 11.7%.

On profitability front, the EBITDA from operations for the quarterimproved by 19.6% year-on-year at Rs. 1,766 million with a margin of18.2%. The company achieved the reported PAT of Rs. 1062 million, agrowth of 17.8% year-on-year with a net margin of 10.9% translating intoEPS of Rs 5.05 per share. The Company has crossed the milestone ofposting quarterly net profit of over Rs. 1000 million for the first time.

The Company is significantly adding capacity and has incurred ~Rs.2000-3000mn capital expenditure in FY18. Management noted that most of thecapacity investment were incurred to dovetail production plans to thoseof key customers. Management expect to invest ~Rs.3500mn in FY2019.

SFL expanding its capacity and making concentrated efforts to improve theproduct mix with focus on high-value products and increased contributionof exports. SFL is a quality ancillary player with robust return ratios and ispoised to further improve its earnings growth momentum.

Anticipating the future growth potential of the Auto component industryand the positioning of SFL as a multi-product and multi-location company,we feel that it has huge growth potential

At CMP, the stock is trading 22.7x time FY19E and 18.9x FY20E earnings.We recommend BUY on Deepak Nitrite Limited with a target price of₹760per share.


Total Income 33,183 38,544 44,986 52,492

EBITDA 6,045 7,037 8,278 9,816

EBITDA Margin 18.2% 18.3% 18.4% 18.7%

PAT 3,382 3,882 4,826 5,806

PAT Margin 10.2% 10.1% 10.7% 11.1%

EPS (₹) 16.1 18.5 23.0 27.6

Debt/Equity 0.57 0.46 0.35 0.27

P/B 9.0 7.2 5.4 4.2

RoE 27.4% 25.4% 24.0% 22.4%

EV/Sales 5.0 4.3 3.7 3.2

P/E 32.8 28.6 22.7 18.9

52 Week L/H 470 / 689

Avg. Daily Volume 90 Day (‘000) 103

No. of Shares O/S (Mn.) / Mkt. Cap (₹Mn.) 210 / 110

Shareholding (Promoters/Institutions/Others) 49.5% / 23.7% / 26.8%



CMP: 521Target: 760

80

100

120

140

160

SF Nifty 500

8

JSW Steel Limited (JSWSTEEL)

Rationale:

JSW Steel is a part of the diversified US$ 13 billion JSW Group, which has apresence in Steel, Energy, Infrastructure, Cement, Ventures and Sports.JSW Steel is one of the leading integrated steel company with an installedsteel-making capacity of 18 MTPA in India. JSW Steel's plant at Vijayanagarin Karnataka, is the largest single location steel producing facility in thecountry with a capacity of 12 MTPA.

The company manufactures and markets a highly diversified portfolio offlat and long steel products and is one of the leading producer andexporter of coated flat steel products.

In the preceding two-and-a-half decades, the Company has grownsignificantly from a 1.6 MTPA capacity in 2002, it currently holds crudesteel production capacity of 18 MTPA; and is targeting to touch 40 MTPAin the next decade.

During the latest quarterly results the company has reported a growth of25% in its consolidated revenues at ₹2,15,520 million as against ₹1,72,400million in Q2-FY18. The growth was mainly due to better realisation.

The company’s operating margins during the quarter stood at 22.8% at₹49,060 million in Q2-FY18 as against 17.6% at ₹30,360 million. The PATmargins for the company stood at 8.6% at ₹18,440 million against 4.9% at₹8,410 million in Q2-FY18. The improvement in margins was due to betterrealisation aided by higher capacity utilisations.

In near term, the management has guided for production volumes ofaround 16.75 tons & saleable volumes of 16tons for FY19. The eightacquired ore mines are expected to be streamlined by Q3-FY19 and tocontribute ~4mt ores by Q4-FY19 with remaining requirement to be eithermet through procured from domestic markets and/or imports.

While in long term, the Company has announced cumulative capexprojects of ₹444.2 billion to expand the Company's steel-making capacityfrom 18 MTPA to 24.7 MTPA by FY-21 with downstream facilities and costsavings projects.

We are positive about the long-term growth potential for steelconsumption in the domestic market. India will need to create over 150Mn tons of new steel capacity in the next 10 years.

At CMP, the stock is trading 10x time FY19E and 10.3x FY20E earnings. Werecommend BUY on JSW Steel Limited with a target price of ₹406 pershare.


Total Income 5,57,570 7,03,920 8,14,251 8,32,629

EBITDA 1,23,260 1,49,610 1,89,893 1,92,403

EBITDA Margin 22.1% 21.3% 23.3% 23.1%

PAT 34,540 60,710 82,025 79,915

PAT Margin 6.2% 8.6% 10.1% 9.6%

EPS (₹) 14.3 25.1 33.9 33.1

Debt/Equity 1.9 1.4 1.1 0.9

P/B 3.8 3.1 2.3 1.9

RoE 15.3% 21.8% 22.7% 18.1%

EV/Sales 2.3 1.8 1.5 1.5

P/E 24.6 14.0 10.0 10.3

52 Week L/H 238 / 428



Shareholding (Promoters/Institutions/Others) 42.3% / 37.2% / 20.5%

Source: Company, Anand Rathi Research , Consensus Estimates.Note: Prices are as on 29th Oct-18.


CMP: 340Target: 406

75

100

125

150

175

JSWSTL Nifty 500

9

Indraprastha Gas Limited (IGL) CMP: 251Target: 319

52 Week Low / High 215 / 345


No. of Shares O/S (Mn.) / Mkt. Cap (`Mn.) 700 / 174

Shareholding (Promoters/Institutional/Others) 45% / 43.3% / 11.7%


Rationale:

Incorporated in 1998, Indraprastha Gas Ltd (IGL) took over the City GasDistribution (CGD) project from GAIL (India) Ltd. IGL is a JV between GAIL(India) and Bharat Petroleum Corporation Ltd (BPCL) where each of thetwo holds 22.5%.

The company is into retail gas distribution business and providesCompressed Natural Gas (CNG) to vehicles and Piped Natural Gas (PNG) todomestic and industrial/commercial consumers in Delhi and NCR.

IGL’s gas sales momentum remains strong as Q1FY19 CNG and PNGvolumes were at 273m kgs (+10% YoY) and 129mscm (+18% YoY),respectively. Within PNG segment, the industrial and commercial volumeswere up 29% YoY given recent ban on use of petcoke and furnace oil. Also,better economics from use of gas vis-à-vis high priced crude oil alternativedrove commercial/industrial volumes.

IGL continues to augment its infrastructure so as to meet the increasingdemand of CNG arising out of growing number of CNG vehicles in Delhi.The growth drivers for increase in demand of CNG are - car manufacturerscoming up with CNG variants and Delhi Government’s directive making itmandatory for all LCVs operating in Delhi to run on CNG. The company is inthe process of enhancing its compression capacity by adding new stations.

On the PNG front, IGL has planned to expand its business activities in Delhiand its neighbouring towns like Noida, Greater Noida and Ghaziabad. Theircustomers will now be benefited with supply of PNG for non cookingapplications like Geysers also. IGL is also working towards expanding itsPNG network to cover all charge areas of Delhi.

Environmental concerns in Delhi have brought to the fore the urgency ofusing cleaner fuels, which puts IGL in a sweet spot. IGL has a uniqueidentity of a company with a rare mix of volume growth and strongmargins, supported by relatively lower natural gas prices and supportivegovernmental initiatives.

We expect the volume growth momentum to continue for the company asState government will add 2,000 new buses in FY19, and expansion of itspipeline network in the new areas- Karnal, Rewari and part of Gurugramwill add volumes 2HFY19 onwards.

At CMP the stock is trading at 17.3x FY19E earnings and 15.5x FY20Eearnings respectively. We recommend a BUY on the stock with a targetprice of ₹319 per share.

Source: Company, Anand Rathi Research , Consensus Estimates.Note: Prices are as on 29th Oct-18.


Total Income 38,607 46,848 64,395 71,951

EBITDA 10,153 12,139 14,929 15,882

EBITDA Margin 26.3% 25.9% 23.2% 22.1%

PAT 5,438 6,498 10,160 11,349

PAT Margin 14.1% 13.9% 15.8% 15.8%

EPS (₹) 7.8 9.3 14.5 16.2

Debt/Equity 0.00 0.00 0.00 0.00

P/B 5.8 4.8 3.8 3.0

RoE 18.1% 17.8% 21.8% 19.6%

EV/Sales 4.5 3.7 2.7 2.4

P/E 32.1 26.8 17.3 15.5

70

82

94

106

118

Oct-17 Jan-18 Apr-18 Jul-18 Oct-18

IGL Nifty 500

10

Diwali Picks 2017 Performance (06th Oct 2017)

Source: Note: Prices are as on 30th Oct-18 close.

In our last Diwali picks we have closed three calls in profit and three stocks have remained open. The open stock picks witnessed few uncertain business events due to post GST implementation issues, Domestic economic factors like rising interest rate cycle etc. This resulted in delay in growth of our subject companies. We continue to monitor our recommended companies and review our recommendations accordingly. In this case, we continue to remain positive on long term growth prospects of these three open stock calls.

Bharat Forge Limited: The company has continued to post good growth numbers in last four quarters however, the extremely high growth posted by company in Q2-FY18 and Q3-FY18

has failed to sustain in the latest two quarters which has dampened the growth outlook and has lowered near term earnings outlook primarily on account of domestic business.

However, we expect growth momentum to continue and are positive on long term growth aspects of the business. We continue to remain positive on Bharat Forge Limited over medium and long term.

Voltas Limited: Voltas has reported a de-growth on PAT level in the past two quarters on account of higher tax payments and lower other incomes due to which returns on stock

till date is subdued. The Company has recently launched washing machines and refrigerators under the brand name of Voltas-Beko which are expected to see a pan-India rollout by

Diwali this year. With continuous growth at operating profit level and new product launches, the company’s long term prospects remains intact. We continue to remain positive on the stock.

Indiabulls Housing Finance Limited: The concerns of liquidity in the NBFC sector particularly HFCs led to significant correction in the stock prices of all HFC’s including Indiabulls Housing Finance Ltd.

In our view, the fall in the price of the stock is more due to compression in valuation multiples based on short term liquidity concerns and higher risk environment and has nothing to do with the fundamentals of the company.

The company is consistently growing in terms of revenue & profitability. Once the short term liquidity concerns are addressed adequately, we could see the valuation multiples to gradually improve over a period of time. We continue to remain positive on the stock over medium & long term.

Status of open calls:

Company Reco Target CMP/ExitHi/Lo for

PeriodStatus Return

Booked on Date

Nifty500 Return

Alpha Return

Annualized Return

Deepak Nitrite Ltd. 207 264 264 305 / 197 Closed 28% 08-Jan-18 10% 18% 68%

Solar Industries Ltd. 941 1250 1280 1300 / 941 Closed 36% 02-Aug-18 9% 27% 32%

MOIL Ltd. 196 245 262 284 / 155 Closed 34% 23-Oct-17 2% 32% 668%

Return on Closed Calls 32% 256%

Voltas Ltd. 529 680 522 675 / 472 Open -1% - -2% 0% -4%

Bharat Forge Ltd. 647 815 557 798 / 541 Open -14% - -2% -10% -14%

Indiabulls Hsg. Finance Ltd. 1268 1580 770 1440 / 639 Open -39% - -2% -42% -46%

Total Return 2% 139%

11

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Continued…

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Contd…

Opinions expressed are our current opinions as of the date appearing on this Research only. We do not undertake to advise you as to any change of our views expressed in this Report. Research Report may differ between ARSSBL’s RAs and/ or ARSSBL’s associate companies on account of differences in research methodology, personal judgment and difference in time horizons for which recommendations are made. User should keep this risk in mind and not hold ARSSBL, its employees and associates responsible for any losses, damages of any type whatsoever.

ARSSBL and its associates or employees may; (a) from time to time, have long or short positions in, and buy or sell the investments in/ security of company (ies) mentioned herein or (b) be engaged in any other transaction involving such investments/ securities of company (ies) discussed herein or act as advisor or lender / borrower to such company (ies) these and other activities of ARSSBL and its associates or employees may not be construed as potential conflict of interest with respect to any recommendation and related information and opinions. Without limiting any of the foregoing, in no event shall ARSSBL and its associates or employees or any third party involved in, or related to computing or compiling the information have any liability for any damages of any kind.

Details of Associates of ARSSBL and Brief History of Disciplinary action by regulatory authorities & its associates are available on our website i. e. www.rathi.com

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Copyright: - This report is strictly confidential and is being furnished to you solely for your information. All material presented in this report, unless specifically indicated otherwise, is under copyright to ARSSBL. None of the material, its content, or any copy of such material or content, may be altered in any way, transmitted, copied or reproduced (in whole or in part) or redistributed in any form to any other party, without the prior express written permission of ARSSBL. All trademarks, service marks and logos used in this report are trademarks or service marks or registered trademarks or service marks of ARSSBL or its affiliates, unless specifically mentioned otherwise.

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13

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Statements on ownership and material conflicts of interest, compensation - ARSSBL and Associates

Sr. No.

Statement

Answers to the Best of theknowledge and belief of theARSSBL/ its Associates/ ResearchAnalyst who is preparing this report

1ARSSBL/its Associates/ Research Analyst/ his Relative have any financial interest in the subject company? Nature of Interest (ifapplicable), is given against the company’s name?.

NO

2ARSSBL/its Associates/ Research Analyst/ his Relative have actual/beneficial ownership of one per cent or more securities of the subjectcompany, at the end of the month immediately preceding the date of publication of the research report or date of the publicappearance?.

NO

3ARSSBL/its Associates/ Research Analyst/ his Relative have any other material conflict of interest at the time of publication of theresearch report or at the time of public appearance?.

NO

4ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation from the subject company in the past twelvemonths.

NO

5ARSSBL/its Associates/ Research Analyst/ his Relative have managed or co-managed public offering of securities for the subjectcompany in the past twelve months.

NO

6ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation for investment banking or merchant banking orbrokerage services from the subject company in the past twelve months. NO

7ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation for products or services other than investmentbanking or merchant banking or brokerage services from the subject company in the past twelve months. NO

8ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation or other benefits from the subject company orthird party in connection with the research report.

NO

9 ARSSBL/its Associates/ Research Analyst/ his Relative have served as an officer, director or employee of the subject company. NO

10 ARSSBL/its Associates/ Research Analyst/ his Relative has been engaged in market making activity for the subject company. NO

research team october 30, 2018 · 2018-11-08 · hdfc bank provides a number of products and...

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