results review 2qfy18 07 nov 2017 kolte patil … patil - 2qfy18 - hdfc sec... · ebidta margins...

RESULTS REVIEW 2QFY18 07 NOV 2017

Kolte Patil Developers NEUTRAL

HDFC securities Institutional Research is also available on Bloomberg HSLB <GO>& Thomson Reuters

Resilient show Aided by the revenue mix tilting towards high-margin projects, Kolte Patil Developers Ltd (KPDL) delivered strong EBIDTA margin of 31.2%(+593bps YoY). This led to 53.2% APAT. KPDL’s pre-sales rebounded 44% QoQ to 0.59mn sqft, in-line with the last 12 quarters average run-rate of 0.58mn sqft. We have excluded the Wakad land sale consideration of Rs 1.6bn from revenue and costs. KPDL received Rs 0.4bn and the balance Rs 1.2bn was used for the repayment of structured loans availed for the Wakad land purchase. Hence, no meaningful debt reduction is reflected in the BS. The launch pipeline remains strong (5.8mn sq ft), while demand is still muted. This shall result in delayed pre-sales recovery from FY19E. We maintain NEU, increase NAV-based TP to Rs 253/sh (vs Rs 195/sh earlier), owing to (1) Reduction in WACC, (2)Land bank valuation change from cost to market value, and (3) Reduction in NAV discount to 10%.

Highlights of the quarter

Margins expansion led financial outperformance: Better realisations from the Pune projects aided margins, and led to EBIDTA/PAT beat. KPDL’s 31.2% margin is not sustainable, and will normalise to 25-26% during FY18E. Limited pricing power in an end-user-driven market will lead to muted pre-sales growth, as investors remain on the sidelines.

Re-modeling launch mix to aid marketability: KPDL’s target is to build 8-10mn sq ft of launch pipeline, with 15% in the Luxury segment, and the balance in the MIG/Affordable segments. This augurs well for accelerating land bank monetisation.

Comfortable surplus to aid deleveraging: We expect KPDL to generate Rs 1.3-1.4bn/annum FCF. This may be utilised towards BS deleveraging.

Financial Summary* (Rs mn) 2QFY18 2QFY17 YoY (%) 1QFY18 QoQ (%) FY17 FY18E FY19E FY20E Net Sales 2,280 2,260 0.9 2,466 (7.5) 9,656 9,661 11,083 12,740 EBITDA 711 570 24.6 591 20.3 2,400 2,486 2,871 3,208 APAT 298 187 59.3 228 31.0 872 906 1,090 1,312 Diluted EPS (Rs) 3.9 2.5 59.3 3.0 31.0 11.5 12.0 14.4 17.3 P/E (x) 22.4 21.6 17.9 14.9 EV / EBITDA (x) 11.0 10.2 8.9 7.6 RoE (%) 10.6 10.1 11.1 12.1 Source: Company, HDFC sec Inst Research, * Consolidated

INDUSTRY REAL ESTATE

CMP (as on 07 Nov 2017) Rs 258

Target Price Rs 253 Nifty 10,350

Sensex 33,371

KEY STOCK DATA Bloomberg KPDL IN

No. of Shares (mn) 76

MCap (Rs bn) / ($ mn) 20/300

6m avg traded value (Rs mn) 90

STOCK PERFORMANCE (%)

52 Week high / low Rs 276/78

3M 6M 12M

Absolute (%) 60.8 42.9 110.1

Relative (%) 57.4 31.2 88.6

SHAREHOLDING PATTERN (%)

Promoters 74.54

FIs & Local MFs 0.07

FPIs 9.71

Public & Others 15.68 Source : BSE

Parikshit Kandpal [email protected] +91-22-6171-7317

Kunal Bhandari [email protected] +91-22-6171-7319

KOLTE PATIL DEVELOPERS : RESULTS REVIEW 2QFY18

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Quarterly Financial Snapshot (Consolidated) Particulars (Rs mn) 2QFY18 2QFY17 YoY (%) 1QFY18 QoQ (%) 1HFY18 1HFY17 YoY (%) Net Sales 2,280* 2,260 0.9 2,466 (7.5) 4,745 4,058 16.9 Material Expenses (1,300)$ (1,430) (9.1) (1,571) (17.2) (2,870) (2,389) 20.1 Employee Expenses (91) (92) (0.9) (89) 2.3 (180) (176) 2.1 Other Operating Expenses (179) (168) 6.3 (216) (17.2) (394) (331) 19.1 EBITDA 711 570 24.6 591 20.3 1,301 1,162 12.0 Interest Cost (249) (205) 21.7 (232) 7.5 (481) (421) 14.1 Depreciation (37) (35) 4.9 (36) 3.4 (72) (71) 1.4 Other Income 24 21 16.1 20 17.2 44 36 21.2 PBT 449 351 27.7 344 30.4 792 706 12.3 OCI (16) (15) 4.5 (26) (39.5) (42) (14) 193.1 Tax (135) (149) (9.7) (90) 49.4 (225) (314) (28.4) APAT 298 187 59.3 228 31.0 526 378 39.2 Source: Company, HDFC sec Inst Research *excludes Rs1,610mn consideration on Waked land sale, #excludes Rs1,622.8mn towards cost on same

Margin Analysis (Consolidated)

MARGIN ANALYSIS 2QFY18 2QFY17 YoY (bps) 1QFY18 QoQ (bps) 1HFY18 1HFY17 YoY (bps) Material Expenses % Net Sales 57.0 63.3 (625) 63.7 (668) 60.5 58.9 161 Employee Expenses % Net Sales 4.0 4.1 (7) 3.6 38 3.8 4.3 (55) Other Operating Expenses % Net Sales 7.8 7.4 40 8.7 (91) 8.3 8.2 15 EBITDA Margin (%) 31.2 25.2 593 24.0 721 27.4 28.6 (121) Tax Rate (%) 30.0 42.4 (1,241) 26.2 380 28.4 44.5 (1,611) APAT Margin (%) 13.1 8.3 480 9.2 385 11.1 9.3 177 Source: Company, HDFC sec Inst Research

Pre – sales Trend Pre-sales trend* 2QFY18 2QFY17 YoY (%) 1QFY18 QoQ (%) 1HFY18 1HFY17 YoY (%) Sales Volume (mn sq ft) 0.59 0.57 3.5 0.41 43.9 1.00 1.23 (18.7) Sales Value (Rs mn) 3,337 3,288 1.5 2,574 29.6 5,911 6,987 (15.4) Average Realization (Rs/sq ft) 5,703 5,804 (1.7) 6,288 (9.3) 5,944 5,701 4.3 Collections (Rs mn) 1,988 2,341 (15.1) 2,531 (21.5) 4,519 4,635 (2.5) Source: Company, HDFC sec Inst Research *Gross sales

Revenue, EBIDTA and net profit grew 0.9%, 24.6% and 59.3% YoY. Revenue was driven by Life Republic, Ivy Estate and first-time revenue recognition in Jai Vijay society, Mumbai EBIDTA margins contracted 593bps YoY to 31.2%, owing to better margins in Life republic, Star gaze and Opula Interest costs increased 21.7% YoY, despite stable debt levels. KPDL realised Rs 400mn from the Wakad land sale, and the balance Rs 1,210mn was utilised to repay two HNI investors who funded the purchase. We remain cautious on accounting, as these liabilities were classified under long/short term liabilities, and not debt Pre-sales momentum rebounded further in 2QFY18, but 1HFY18 pre-sales is muted, with 18.7% YoY de-growth. Average realisation stood at Rs 5,703/sq ft Collection stood at Rs 1,988mn


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Positive cashflows – To aid deleveraging efforts In the exhibit below, we highlight KPDL’s proforma

cashflows. We expect KDPL to achieve Rs 10-13bn real estate collections annually. The spend on construction is pegged at Rs 5-7bn/annum. This will result in a gross surplus of Rs 4-5bn from real estate operations.

Employee cost and overheads will consume about Rs 1.2-1.3bn annually, while the outgo on interest servicing shall be Rs 0.8-0.9bn. With a limited outflow for maintenance/new land capex, KPDL would be Rs 1.3-1.4bn/annum cash surplus.

KPDL does not have any large maintenance/fixed assets capex, and neither has the company planned a big outlay for the rental asset business. The current approval pipeline remains strong (~5.8mn sq ft) and does not require any aggressive land capex to be incurred.

Deleveraging efforts seem to be reasonable, on the back of strong real estate collections and limited capex.

Proforma Cashflows Rs mn FY17 FY18E FY19E FY20E Real Estate Collections 9,643 10,156 11,387 12,767 Construction Spend 5,100 5,610 6,339 7,227 Operating Cash flows - Dev Co 4,543 4,546 5,048 5,540 Employes+Other Expenses 1,175 1,191 1,310 1,441 Taxes 740 616 743 909 Total OCF 2,629 2,739 2,995 3,190 Less: Assets Capex - 100 100 100 Less: Land Capex/TDR’s 900 500 750 850 Net OCF 1,729 2,139 2,145 2,240 Less: Interest Outgo 950 950 969 988 FCFE 779 1,189 1,176 1,252 Other Income 82 98 103 108 Net Surplus 861 1,287 1,279 1,360 Source: Company, HDFC sec Inst Research

Strong collections and limited capex on land/rental/fixed assets will help deleverage the balance sheet We expect KPDL to be net cash surplus annually by Rs 1.3-1.4bn


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Net D/E: – May Have Peaked – To Remain At <0.5x (Rs mn) 3QFY16 4QFY16 1QFY17 2QFY17 3QFY17 4QFY17 1QY18 2QFY18 Comments Gross Debt 6,070 5,930 7,640 7,690 7,740 7,580 7,750 7,620

Structure NCD's (1,030) (1,030) (1,970) (2,340) (2,340) (2,330) (2,290) (2,290) Deducting NCD & CCD as they are equity structured as debt by KPDL and JVs

Cash 650 820 680 431 820 730 (950) (830) Current investments 240 30 400 236 Net debt 4,150 4,050 4,590 4,684 4,580 4,520 4,520 4,510 Excluding promoters and JV partners

non recourse NCD’s Net Worth 8,970 8,770 8,860 8,370 8,520 8,630 8,990 9,150 Net Debt/ equity (x) 0.46 0.46 0.52 0.56 0.54 0.52 0.50 0.49 Source: Company, HDFC sec Inst Research

Change In Estimates

FY18E

New FY18E

Old % Change FY19E New

FY19E Old % Change Comments

Pre-sales (mn sqft) 2.1 2.4 (14.4) 2.5 2.5 -

Realization (Rs/sqft) 5,989 5,807 3.1 5,947 5,947 0.0 Realisations to improve, as New Mumbai launches happen at higher realisations (3x of Pune)

Pre-sales (Rs mn) 12,306 13,673 (10.0) 15,136 15,136 (0.0)

Revenues (Rs mn) 9,661 8,674 11.4 11,083 11,100 (0.2) Marginal revision higher

EBITDA (Rs mn) 2,486 2,290 8.6 2,871 3,048 (5.8) Cut on account of higher affordable segment contribution

APAT (Rs mn) 906 829 9.3 1,090 1,254 (12.8) High interest expense key reason for cut EPS (Rs) 12.0 10.9 9.3 14.4 16.5 (12.8) Source: HDFC sec Inst Research

We expect consolidated net D/E to remain <0.5x We have cut our volume estimate for FY18E to factor in new projects’ approval delay We have raised our FY18E EPS estimate on account of higher-than-expected contribution from Mumbai projects and commercial sales We have cut our FY19E estimate on account of higher interest expense


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Valuation – Increased NAV target to Rs 253/share We have valued KPDL using DCF, and arrived at a

target price of Rs 253/share. Our valuation is based on 0.9x our end-FY19E NAV forecast. We have reduced NAV discount to 10%. This is to factor in (1) A limited further property price correction, and (2) New opportunities arising from the unorganised to organised market share gain. We have not considered the likely upside in saleable area once the township FSI increases from 0.5x to 1x.

The State government has already increased FSI for non-agricultural land-based townships, and is in the final stages of implementing it for townships on agricultural land. KPDL’s key projects that will be affected are (1) Life Republic Township, and (2) Sanjivani township. In terms of value, this could add about Rs 64/share to NAV, and about ~20mn sq ft to the gross saleable area (~10mn sq ft KPDL share).

Rs mn New NAV Old NAV Change (%) Comments

Gross NAV 27,236 23,256 17.1 (1)Largely on account of land price change from cost to market valuation and (2)WACC reduction from 14% to 13% in-line with cost of capital

Less Net debt (5,962) (4,811) 23.9 Net debt as on end FY19E Current Investments 40 47.6 NAV 21,314 18,493 15.3 Change lower than GAV owing to increase in debt Shares outstanding (mn) 76 76 As of Sep-17 NAV/share (Rs) 281 244 15.3

Discount to NAV 10% 20% Decreasing NAV discount (1) Due to stability in property prices post 7-10% correction and (2) New opportunities through JDA, affordable housing etc

Target Price (Rs) 253 195 29.7 Source: Company, HDFC sec Inst Research

GNAV mix: Rs 27.2bn Rs mn Rs/sh % Pune 255 71.0 Bengaluru 33 9.1 Mumbai 14 3.9 Land Bank 57 16.0 Total GAV 359 100 Source: Company, HDFC sec Inst Research

We have reduced our WACC from 14% to 13% on expectations of lower cost of capital under the RERA regime. This, along with (1)Land valuation assumptions change from book value to market value and (2) Lowering of NAV discount, have resulted in the NAV target increase to Rs 253/sh KPDL is resizing 2.1mn sq ft in the Rs 5.5mn ticket size. This will drive FY18E volumes. Total launches of 5.8mn sq ft are planned over the next 4-6 quarters We maintain NEUTRAL rating on KPDL


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Real estate development – NAV calculation methodology

We have divided KPDL’s entire land bank (with launch visibility over the next five years) into residential projects (based on information given by the company).

We have arrived at the sales price/sq ft and the anticipated sales volumes for each project based on our discussions with industry experts.

We have deducted the cost of construction based on our assumed cost estimates, which have been arrived at after discussions with industry experts.

We have further deducted marketing and other costs that have been assumed at 5% of the sales revenue.

We have then deducted income tax, based on the tax applicable for the project.

The resultant cash inflows at the project level have been discounted, based on WACC of 13% (cost of equity 15.1% based on beta of 1.1x & debt/equity ratio of 0.4x). All the project-level NAVs have then been summed up to arrive at the NAV of the company.

From the NAV, we have deducted the net debt and likely outgo on the balance land payments as of FY19E to arrive at the final valuation of the company.


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Key valuation assumptions In the exhibit below, we highlight our sales and cost

inflation forecasts. We expect property price appreciation in-line with WPI inflation, i.e. 5%, and peg cost inflation slightly higher at 6%. We forecast other costs including marketing, SGA and employee costs at 15% of sales. We have discounted cash flows using 13% as the hurdle rate.

Base Case Assumptions Assumptions % Discount rate 13 Annual rate of inflation - sales price 5 Annual rate of inflation - cost of construction 6 Other costs - marketing, SGA, employee cost (as % sales) 15

Tax rate 33 Source: Company, HDFC sec Inst Research

Our pricing assumptions are moderate and at a 5-10% discount to the current prevailing prices. Construction cost assumptions are higher than KPDL estimates.

Base Property Price And Construction Cost Assumptions

Location City Prices Rs/sqft

Cost Rs/sqft

Wagholi Pune 3,750 1,800 Hinjewadi Pune 4,900 2,100 Kharadi Pune 5,000 2,200 Undri-NIBM Pune 4,500 2,200 Mohamad Wadi Pune 4,500 2,200 Aundh Annexe Pune 5,200 2,500 Boat Club Road Pune 9,100 3,500 Kondhwa Pune 3,900 2,000 Viman Nagar Pune 8,600 3,500 Aundh Pune 6,700 2,600 Kalyani Nagar Pune 7,500 2,800 Bavdhan Pune 4,600 2,000 Atria Pune 7,200 2,800 Wakad Pune 5,400 2,500 Andheri Mumbai 14,500 7,500 Vile Parle Mumbai 20,000 9,500 Koramangla Block III Bangalore 6,200 2,400 Hosur Road Bangalore 5,700 2,300 Kannur Road Bangalore 3,750 1,800 Source: Company, HDFC sec Inst Research

Our pricing assumptions are moderate, and at a 5-10% discount to the current prevailing prices.


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NAV sensitivity analysis Sensitivity to our assumptions of property prices

Our model is sensitive to changes in the assumptions regarding property prices. For every 1% change in the base property price, the NAV will change by approximately 2.7%.

NAV Sensitivity To Changes In Base Sale Price % change in sale price (10) (5) 0 5 10

NAV/share (Rs) 185 219 253 287 319 Change in NAV (%) (27.1) (13.4) - 13.5 26.1 Source : Company, HDFC sec Inst Research

Sensitivity of NAV to changes in sales’ inflation

In our base case, we have assumed an annual sales price inflation of 5%. For every 100bps increase in the annual sales price inflation, the NAV will increase by approximately 6.9%.

NAV Sensitivity To Change In Sales Inflation Sales inflation rates (%) 3 4 5 6 7

NAV/share (Rs) 219 236 253 271 288 Change in NAV (%) (13.4) (6.7) - 6.9 13.7 Source: Company, HDFC sec Inst Research

Sensitivity of NAV to changes in cost inflation

In our base case, we have assumed cost inflation to be 6%. For every 100bps increase in construction cost inflation, the NAV will change by approximately 4.5%.

NAV Sensitivity To Change In Cost Inflation Cost inflation rates (%) 4 5 6 7 8 NAV/share (Rs) 276 265 253 242 230 Change in NAV (%) 9.2 4.6 - (4.5) (9.1) Source : Company, HDFC sec Inst Research

The combined impact of a 100bps increase in the sales price inflation and cost inflation will be a NAV increase of 2.4%.

Sensitivity of NAV to changes in discount rate

In our base case, we have assumed a discount rate of 13%. For every 100bps increase in the discount rate, the NAV will fall by ~5.1%.

NAV Sensitivity To Change In WACC WACC rates (%) 11 12 13 14 15 NAV/share (Rs) 279 266 253 240 227 Change in NAV (%) 10.3 5.2 - (5.1) (10.2) Source: Company, HDFC sec Inst Research

1% increase in the average base sale price impacts our NAV positively by 2.7% Every 100bps increase in sale price inflation impacts our NAV positively by 6.9% 100bps increase in cost inputs decreases our NAV by 4.5% 100bps increase in discounting rate impacts our NAV negatively by 5.1%


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Income Statement (Consolidated) Y/E March (Rs mn) FY16 FY17 FY18E FY19E FY20E Net Sales 7,538 9,656 9,661 11,083 12,740 Growth (%) 8.2 28.1 0.1 14.7 15.0 Material Expenses 4,252 6,082 5,984 6,902 8,091 Employee Expenses 480 422 401 441 485 Other Operating Expenses 821 753 790 869 956 EBIDTA 1,984 2,400 2,486 2,871 3,208 EBIDTA (%) 26.3 24.9 25.7 25.9 25.2 EBIDTA Growth (%) (2.9) 21.0 3.6 15.5 11.7 Other Income 165 82 98 103 108 Depreciation 152 149 134 134 128 EBIT 1,998 2,334 2,450 2,840 3,189 Interest 840 860 910 886 797 PBT 1,158 1,473 1,541 1,954 2,392 Tax 535 624 616 743 909 PAT 623 849 924 1,212 1,483 Minority Interest (34) 23 (18) (121) (171) APAT 589 872 906 1,090 1,312 APAT Growth (%) (9.8) 48.0 3.9 20.4 20.3 EPS 7.8 11.5 12.0 14.4 17.3 EPS Growth (%) (9.8) 48.0 3.9 20.4 20.3

Source: Company, HDFC sec Inst Research

Balance Sheet (Consolidated) Y/E March (Rs mn) FY16 FY17 FY18E FY19E FY20E SOURCES OF FUNDS Share Capital 758 758 758 758 758 Reserves 7,066 7,880 8,612 9,521 10,615 Total Shareholders Funds 7,824 8,638 9,369 10,279 11,373 Minority Interest 3,024 2,666 2,684 2,806 2,976 Long Term Debt 6,443 3,707 3,807 3,307 2,307 Short Term Debt 1,469 3,903 3,903 3,903 3,903 Total Debt 7,912 7,610 7,710 7,210 6,210 Deferred Taxes 25 (25) (25) (25) (25) Long Term Provisions & Others 174 142 142 142 142 TOTAL SOURCES OF FUNDS 18,959 19,032 19,882 20,412 20,677 APPLICATION OF FUNDS Net Block 1,137 1,061 1,047 1,113 1,285 CWIP 19 22 22 22 22 Goodwill 211 211 211 211 211 Investments, LT Loans & Advances - - 20 40 60

Other Non Current Assets 1,689 1,662 1,662 1,662 1,662 Inventories 20,390 20,607 20,645 21,255 21,641 Debtors 1,468 1,770 1,720 1,822 2,094 Cash & Equivalents 849 797 1,801 1,248 1,369 ST Loans & Advances, Others 1,949 1,972 4,179 3,663 4,137 Total Current Assets 24,655 25,147 28,346 27,988 29,241 Creditors 1,538 1,761 1,937 2,130 2,343 Other Current Liabilities & Provns 7,214 7,311 9,491 8,494 9,461 Total Current Liabilities 8,752 9,072 11,427 10,624 11,805 Net Current Assets 15,903 16,075 16,919 17,364 17,436 TOTAL APPLICATION OF FUNDS 18,959 19,032 19,882 20,412 20,677



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Cash Flow (Consolidated) Y/E March (Rs mn) FY16 FY17 FY18E FY19E FY20E PBT before minority 1,158 1,473 1,541 1,954 2,392 Non-operating & EO items (132) (29) (98) (103) (108) Taxes (652) (494) (616) (743) (909) Interest expenses 840 860 910 886 797 Depreciation 152 149 134 134 128 Working Capital Change (1,002) (543) 160 (998) 49 OPERATING CASH FLOW ( a ) 364 1,417 2,030 1,130 2,347 Capex (328) (77) (120) (200) (300) Free cash flow (FCF) 37 1,340 1,910 930 2,047 Investments (1,046) 496 78 83 88 INVESTING CASH FLOW ( b ) (1,374) 419 (42) (117) (212) Share capital Issuance - - - - - Debt Issuance 2,310 (655) 100 (500) (1,000) Interest expenses (696) (792) (910) (886) (797) Dividend (421) (262) (174) (181) (218) FINANCING CASH FLOW ( c ) 1,194 (1,709) (984) (1,567) (2,015) NET CASH FLOW (a+b+c) 185 126 1,004 (554) 121 Opening Cash 367 552 797 1,801 1,248 Others 297 119 Closing Cash & Equivalents 849 797 1,801 1,248 1,369


Key Ratios (Consolidated) Y/E March FY16 FY17 FY18E FY19E FY20E PROFITABILITY (%) GPM 43.6 37.0 38.1 37.7 36.5 EBITDA Margin 26.3 24.9 25.7 25.9 25.2 EBIT Margin 26.5 24.2 25.4 25.6 25.0 APAT Margin 7.8 9.0 9.4 9.8 10.3 RoE 7.3 10.6 10.1 11.1 12.1 Core RoCE 10.4 13.6 14.2 16.6 18.5 RoCE 12.1 12.3 12.6 14.1 15.6 EFFICIENCY Tax Rate (%) 46.2 42.4 40.0 38.0 38.0 Asset Turnover (x) 0.4 0.5 0.5 0.5 0.6 Inventory (days) 849 775 779 690 614 Debtors (days) 60 61 66 58 56 Payables (days) 66 62 70 67 64 Cash Conversion Cycle (days) 843 774 775 681 606 Debt/EBITDA (x) 4.0 3.2 3.1 2.5 1.9 Net D/E 0.9 0.8 0.6 0.6 0.4 Interest Coverage 2.4 2.7 2.7 3.2 4.0 PER SHARE DATA EPS (Rs/sh) 7.8 11.5 12.0 14.4 17.3 CEPS (Rs/sh) 9.8 13.5 13.7 16.2 19.0 DPS (Rs/sh) 1.2 2.3 2.4 2.9 3.5 BV (Rs/sh) 103.3 114.0 123.7 135.7 150.1 VALUATION P/E 33.2 22.4 21.6 17.9 14.9 P/BV 2.5 2.3 2.1 1.9 1.7 EV/EBITDA 13.4 11.0 10.2 8.9 7.6 OCF/EV (%) 1.4 0.1 0.1 0.0 0.1 FCF/EV (%) 0.1 5.1 7.5 3.6 8.4 FCFE/Market Cap 12.0 3.5 10.3 2.2 5.4 Dividend Yield (%) 0.5 0.9 0.9 1.1 1.3



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Rating Definitions

BUY : Where the stock is expected to deliver more than 10% returns over the next 12 month period NEUTRAL : Where the stock is expected to deliver (-)10% to 10% returns over the next 12 month period SELL : Where the stock is expected to deliver less than (-)10% returns over the next 12 month period

Date CMP Reco Target 7-Dec-16 98 BUY 144 13-Apr-17 177 NEU 177 7-Jun-17 177 BUY 195

11-Oct-17 216 NEU 195 7-Nov-17 258 NEU 253

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Kolte-Patil TP

RECOMMENDATION HISTORY


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HSL or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from t date of this report for services in respect of managing or co-managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction in the normal course of business. HSL or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither HSL nor Research Analysts have any material conflict of interest at the time of publication of this report. Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions. HSL may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report. Research entity has not been engaged in market making activity for the subject company. Research analyst has not served as an officer, director or employee of the subject company. We have not received any compensation/benefits from the subject company or third party in connection with the Research Report. HDFC securities Limited, I Think Techno Campus, Building - B, "Alpha", Office Floor 8, Near Kanjurmarg Station, Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042 Phone: (022) 3075 3400 Fax: (022) 2496 5066 Compliance Officer: Binkle R. Oza Email: [email protected] Phone: (022) 3045 3600 HDFC Securities Limited, SEBI Reg. No.: NSE-INB/F/E 231109431, BSE-INB/F 011109437, AMFI Reg. No. ARN: 13549, PFRDA Reg. No. POP: 04102015, IRDA Corporate Agent License No.: HDF 2806925/HDF C000222657, SEBI Research Analyst Reg. No.: INH000002475, CIN - U67120MH2000PLC152193 Mutual Funds Investments are subject to market risk. Please read the offer and scheme related documents carefully before investing.

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