Institutional

Equity
Research

ACC Ltd

Cement | India

ACC IN; ACC. BO

3QC15 result review

Current price (21 Oct)
Target price
Upside/(downside)
Earning estimate

HOLD
Rs
Rs
%

Market data
Mkt capitalisation
Average daily vol
52-week H/L
Shares O/S
Free float
Promotor holding
Foreign holding
Face value

1,380
1,481
7
Unchanged

Rs bn
259.1
'000
338.1
Rs 1774.8 / 1301.5
mn
187.7
mn
93.3
%
50.3
%
13.2
Rs
10.0

Price performance (%)

Nifty (abs)
Stock (abs)
Relative to Index

1m
3.4
(0.2)
(3.7)

3m
(3.3)
(4.1)
(0.9)

Performance
1800
(Rs)

6m
(1.5)
(7.8)
(6.3)

(%)

1700

1yr
4.1
(4.5)
(8.6)

20
10

1600
0
1500
(10)

1400
1300
Oct-14

Jan-15

Apr-15

ACC (LHS)

Jul-15

(20)
Oct-15

Rel. to Nifty (RHS)

Source: Bloomberg, SSLe

October 21, 2015

Consistent underperformance with no surprises

ACCs 3QC15 operating performance undershot SSLe, as the companys operating
profits plunged 10.6% YoY to Rs2.9bn (SSLe of Rs3.07bn). The company displayed a
disappointing performance, spurred by consistently higher raw materials and power
costs. This was accompanied with flat volumes and marginally lower realizations (at
Rs4,618/tonne) weighing down the operating performance. Meanwhile, capacity
utilization continued to hover ~74% YoY (declined from 82% in 2QC15, flat vs.3QC14).
ACCs cost inflation continued, and was in line with expectations, as cost/tonne rose ~
1% YoY to Rs4,370/tonne. Cost of Logistics and raw materials increased, as clinker
was transported/purchased from other units/sources as the Chaibasa plant was
partially shut in 3QC15. Power & fuel costs declined lower than expected by ~1% due
to lower fuel cost. Effectively, EBIDTA/tonne remained low after falling YoY to
Rs515/tonne (Rs544/tonne in 3QC14). EBITDAM also shrank to 12.1% (13.5% in
3QC14), while EBITDA fell by 10.6% (post adjustment to DMR charges) to Rs3.38bn.
Adjusted PAT declined by a sharp 30.8% YoY to Rs1.42bn.
Volumes flat in Q3: ACCs cement volumes came flat at ~5.61MT YoY but still
exceeded expectations. Meanwhile, capacity utilization hovered ~ 74% in 3QC15
which was again flat vs. 3QC14. Demand continued to remain sluggish in key ACC
markets as reflected by the 2% YoY decline in realizations, coming at Rs4,618/tonne,
despite no growth in dispatches.
Margins slide on the back of weak realizations, steady but higher input cost:
ACCs cost inflation continued due to the partially non-operational Chaibasa unit
(Jharkhand) in Q3. This unit feeds clinker to two units in the eastern region. Effectively,
the raw material costs stayed firm at Rs745/tonne (Rs766/tonne in 3QC14). The
logistic costs remained high at Rs1,093/tonne, despite softening diesel costs, due to
higher transfer of clinker and increase in rail freight. ACC has a rail:road mix of ~43:57.
The key disappointment was the higher power cost, coming at Rs1,104/tonne
(Rs1,113/tonne in 3QC14), despite softening fuel prices. Effectively, the cost/tonne
jumped to Rs4,370/tonne flat YoY, despite softening input cost (earlier Rs4,334/tonne
YoY). Meanwhile, other expenditure increased 8%, despite flat volume and reduction
in packaging cost by Rs29/tonne, due to provision of royalty towards DMR and hike in
royalty rates on limestone YoY. The steep jump in costs and flat realization YoY
weighed EBITDAM down to 12.1% (13.5% in 3QC14). EBITDA/tonne fell to
Rs515/tonne from Rs544/tonne in 3QC14, as EBITDA declined by 11% YoY to
Rs3.38bn.
Earnings estimates maintained: We have maintained our full year estimates for
C15e/C16e/C17e, following inline performance in 3QC15. Though we expect
economic activity to witness a pick-up and contribute to a revival in cement demand,
ACCs cost overrun is likely to continue. We expect demand revival to fillip the
companys quest in attaining volume and realization gains in C16e/C17e. We maitain
our earnings estimates of Rs35.2/Rs50.9/64.2/share for C15e/C16e/C17e. We will
keep an eye on the demand revival and may revise our earnings estimates
accordingly.
Valuation and recommendation: We continue to value ACC (capacities of
30/32.7MT) based on the replacement cost method, with a base cost assumption of
Rs7.5bn/MT and assign a 10% premium. We have revised our 1-year forward target
price to Rs1,481/share (Rs1,432 earlier) based on the same. At our target price, the
stock trades at P/E of Rs29.4x and EV/EBITDA of 15.82x 1-year earnings estimates.
We maintain HOLD rating on the stock.
Financial Summary

Milind Raginwar
+91 22 4227 3362
milind.raginwar@sbicapsec.com
Ashutosh Adsare
+91 22 4227 3496
ashutosh.adsare@sbicapsec.com

Y/E Dec(Rs mn)

Net sales
growth (%)
EBITDA margin (%)
Adjusted net profit
EPS (Rs)
growth (%)
P/E (x)
EV/EBITDA (x)
Dividend yield (%)
RoE (%)
RoCE (%)
Source: Company, SSLe

SBICAP Research on Bloomberg SBICAP <GO>, www.securities.com

C13
109,084
(2.0)
13.6
8,310
44.2
(35.6)
32.6
15.6
2.1
10.9
15.0

C14
114,811
5.2
12.3
8,031
42.7
(3.4)
33.7
17.1
2.4
10.0
13.6

C15e
124,543
8.5
11.0
6,680
35.5
(16.8)
40.6
18.5
2.1
8.3
11.1

C16e
136,857
9.9
13.3
9,570
50.9
43.3
28.3
14.0
2.1
11.4
15.0

C17e
153,564
12.2
14.3
12,064
64.2
26.1
22.5
11.6
2.1
14.0
18.2

Please refer to our disclaimer given at the last page.

SBICAP Securities Ltd

ACC Ltd

Quarterly Financials
Y/E Dec (Rs mn)

3QC15

3QC14 YoY (%)

2QC15 QoQ (%) 3QC15e Var (%)

Net sales

27,898

28,145

30,153

Cost of goods

3,951

4,119

5,029

4,130

Employee benefits exp.

1,660

1,915

2,003

2,010

Power & fuel costs

6,183

6,253

6,101

5,194

12,719

12,072

13,685

12,567

3,385

3,786

12.1

13.5

Depreciation and amort.

1,607

1,393

EBIT

1,778

2,392

Other Expenses
EBITDAM fell due continued cost inflation.
Logistics and raw material costs contributed to
higher cost

EBITDA
EBITDAM (%)

EBITM (%)

(0.9)

(10.6)

(7.5)

3,335

27,522

1.5

3,620

11.1

(6.5)

13.2

1,657
(25.7)

1.4

1,690

1,679

5.9

1,930

Other income

(69)

446

235

215

Interest expenses

150

115

143

156

1,559

2,723

389

674

(7.9)

Extraordinary/Exceptional
Profit before tax
Tax expense
Effective tax rate (%)
PAT

(42.8)

1,771

(12.0)

1,989

456

(21.6)

517

25

25

1,170

2,049

(42.9)

1,314

26
(10.9)

1,472

26
(20.5)

1,170

2,049

(42.9)

1,314

(10.9)

1,472

(20.5)

Minority Interest
Reported net profit
Non-recurring items

(249)

Adj. net profit

1,419

2,049

NPM (%)

5.1

7.3

EPS (Rs)

7.5

10.9

(30.8)

1,314

8.0

1,472

4.4
(30.8)

(3.6)

5.3

7.0

8.0

7.8

(3.6)

Note: Revenue includes operating income

Source: Company, SSLe

EBITDAM shrank due to cost inflation and muted realizations

Realization/t (LHS)

Volume (RHS)

12.1 14

310

451

8.9

515

711
11.1

544

630

449

564

12.1

EBITDA/t (LHS)

3QC15

2QC15

1QC15

4QC14

3QC14

2QC14

1QC14

4QC13

2QC13

1QC13

3QC15

2QC15

1QC15

4QC14

3QC14

2QC14

1QC14

4QC13

3QC13

3,800

2QC13

407

300
2

11.1

3QC13

15.9
14.0 14.713.5

(Rs/t)

600

708

(MT)

5.8

4,618

5.6

696

6.2

4,100

1QC13

21
16.9 17.2

4,547

4,626

5.6 5.8

4,706

5.9

4,572

4,393

4,400

4,440

4,700

4,385

5.5

4,442

6.1

4,533

6.4

(Rs/t)

900

8
6.5 6.4

4,955

5,000

(%)

Volume growth continues to remain sluggish

Margin (RHS)

Source: Bloomberg, SSLe

milind.raginwar@sbicapsec.com | ashutosh.adsare@sbicapsec.com

October 21, 2015 | 2

SBICAP Securities Ltd

ACC Ltd
Key assumption
C15e
Volume (mn tonnes)

We have maintained our volume and realization

estimates for C15/C16e/C17e

Realisation (Rs/tonne)

Revised
C16e

C17e

Old
C16e

C15e

C17e

Change (%)
C15e C16e C17e

24.6

26.1

28.4

24.6

26.1

28.4

0.0

0.0

0.0

4741.1

4920.1

5010.0

4741.1

4920.1

5010.0

0.0

0.0

0.0

Power Cost (per tonne)

1070.5

1062.1

1073.7

1070.5

1062.1

1073.7

0.0

0.0

0.0

Logistic Cost (per tonne)

Source: SSLe

1207.0

1117.8

1117.8

1207.0

1117.8

1117.8

0.0

0.0

0.0

Valuations
Equity Share Capital (Rs mn)
FV (Rs)
No of equtiy shares (mn)
CMP (Rs)

C15e

C16e

C17e

1,880

1,880

1,880

10

10

10

187.95

187.95

187.95

1,380

1,380

1,380

M-cap (Rs mn)

259,371

259,371

259,371

Net Debt

(13,494)

(8,947)

(13,812)

EV

245,877

250,424

245,559

30.239

32.689

32.689

EV/tonne (US $)

135.5

127.7

125.2

EV/tonne (Rs)
Source: SSLe

8,131

7,661

7,512

Total Capacity

EV/Tonne Chart
2,400

1,200

600

Jan-06
May-06
Sep-06
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
Jun-14
Oct-14
Feb-15
Jun-15
Oct-15

We continue to maintain HOLD rating on the

stock as the stock is currently trading at
fair valuation based on the replacement
cost valuation method

(Rs)

1,800

Price (Rs)

100x

120x

140x

160x

$180

Source: Bloomberg, SSLe

milind.raginwar@sbicapsec.com | ashutosh.adsare@sbicapsec.com

October 21, 2015 | 3

SBICAP Securities Ltd

ACC Ltd

Financials
Income Statement
Y/E Dec (Rsmn)
C13
C14
C15e
C16e
C17e
Net sales
109,084
114,811
124,543
136,857
153,564
growth (%)
(2.0)
5.2
8.5
9.9
12.2
Operating expenses
(95,244) (102,151) (113,049) (121,105) (134,090)
EBITDA
15,038
14,262
14,019
18,502
22,404
growth (%)
(28.4)
(5.2)
(1.7)
32.0
21.1
Depreciation &amortisation
(5,740)
(5,576)
(6,532)
(7,340)
(7,780)
EBIT
12,306
11,620
9,612
13,562
17,169
Other income
3,007
2,933
2,125
2,400
2,545
Interest paid
(517)
(828)
(462)
(629)
(643)
Extraordinary/Exceptional items
PBT
11,790
11,352
9,150
12,933
16,527
Tax
(3,479)
(2,761)
(2,471)
(3,363)
(4,462)
Effective tax rate (%)
(29.5)
(24.3)
(27.0)
(26.0)
(27.0)
Net profit
8,310
8,591
6,680
9,570
12,064
Minority interest
0
0
0
0
0
Reported Net profit
10,958
11,683
6,680
9,570
12,064
Non-recurring items
0
560
0
0
0
Adjusted Net profit
8,310
8,031
6,680
9,570
12,064
growth (%)
(35.6)
(3.4)
(16.8)
43.3
26.1
Key Financials ratios
Y/E Dec (Rsmn)
C13
Profitability and return ratios (%)
EBITDAM
13.6
EBITM
11.2
NPM
7.6
RoE
10.9
RoCE
15.0
RoIC
16.5

C14

C15e

C16e

C17e

12.3
10.0
7.0
10.0
13.6
14.0

11.0
7.6
5.4
8.3
11.1
11.0

13.3
9.7
7.0
11.4
15.0
13.4

14.3
11.0
7.9
14.0
18.2
15.9

Per share data (Rs)

O/s shares
EPS
FDEPS
CEPS
BV
DPS

187.9
44.2
44.2
74.8
416.3
30.0

187.9
42.7
42.7
72.4
438.2
34.0

187.9
35.5
35.5
70.3
437.5
31.0

187.9
50.9
50.9
90.0
452.2
31.0

187.9
64.2
64.2
105.6
480.1
31.0

Valuation ratios (x)

PE
P/BV
EV/EBITDA
EV/Sales

32.6
3.5
15.6
2.1

33.7
3.3
17.1
2.1

40.6
3.3
18.5
2.1

28.3
3.2
14.0
1.9

22.5
3.0
11.6
1.7

Other key ratios

D/E (x)
DSO (days)

(0.3)
24

(0.2)
25

(0.2)
27

(0.1)
28

(0.2)
29

7.6
0.9
1.6
10.9

7.0
0.9
1.5
10.0

5.4
1.0
1.6
8.3

7.0
1.0
1.6
11.4

7.9
1.1
1.6
14.0

Du Pont Analysis - RoE

NPM (%)
Asset turnover (x)
Equity Multiplier (x)
RoE (%)
Source: Company, SSLe

milind.raginwar@sbicapsec.com | ashutosh.adsare@sbicapsec.com

Balance Sheet
Y/E Dec (Rsmn)
Cash & Bank balances
Other Current assets
Investments

C14
3,043
45,689
2,851

C15e
3,490
51,368
2,851

C16e
3,172
53,121
2,851

C17e
3,607
64,277
2,851

62,636
74,539
600
591
0
0
120,936 126,713

73,101
850
0
131,660

76,671
850
0
136,665

73,252
1,050
0
145,037

39,002
0
5,356
44,357

41,707
2,374
5,356
49,436

43,723
2,604
5,356
51,683

46,772
2,674
5,356
54,802

Share capital
Reserves & surplus
Shareholders' funds
Minority interest
Total equity & liabilities

1,880
1,880
76,368
80,476
78,248
82,355
0
0
120,935 126,713

1,880
80,344
82,224
0
131,660

1,880
83,103
84,982
0
136,665

1,880
88,356
90,235
0
145,037

Cash Flow Statement

Y/E Dec (Rsmn)
Pre-tax profit
Depreciation
Chg in working capital
Total tax paid
Other operating activities
Operating CF

C13
11,790
5,407
(4,592)
(5,916)
0
6,688

C14
11,352
4,567
1,140
(4,072)
0
12,987

C15e
9,150
6,532
(3,779)
(2,279)
0
9,624

C16e
12,933
7,340
(3,937)
(3,162)
0
13,174

C17e
16,527
7,780
(3,818)
(4,251)
0
16,237

Capital expenditure
Chg in investments
Other investing activities
Investing CF
FCF

(6,891) (16,462)
3,595
6,210
0
0
(3,295) (10,252)
3,393
2,735

(5,353)
500
0
(4,853)
4,771

(10,910)
4,000
0
(6,910)
6,264

(4,560)
(4,500)
0
(9,060)
7,177

Equity raised/(repaid)
Debt raised/(repaid)
Dividend (incl. tax)
Other financing activities
Financing CF

(1)
(1,280)
(6,590)
2,728
(5,143)

0
(350)
(7,468)
3,092
(4,727)

0
2,374
(6,697)
0
(4,323)

0
230
(6,812)
0
(6,582)

0
70
(6,812)
0
(6,742)

Net chg in cash & bank bal.

Closing cash & bank bal

(1,750)
5,034

(1,991)
3,043

447
3,490

(318)
3,172

435
3,607

Net fixed assets

Goodwill & intangible assets
Other non-current assets
Total assets
Current liabilities
Borrowings
Other non-current liabilities
Total liabilities

C13
5,034
50,956
1,710

37,265
350
5,073
42,688

October 21, 2015 | 4

SBICAP Securities Ltd

ACC Ltd

Recommendation History
Date

BUY

2000

HOLD

Stock Price

SELL
Target Price

1800

(Rs)

1600
1400
1200

800

Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Aug-14
Oct-14
Nov-14
Dec-14
Jan-15
Feb-15
Mar-15
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15

1000

Stock Price

TP

Rec.

1,224

1,223

HOLD

7-May-13
26-Jul-13

1,212

1,110

HOLD

29-Oct-13

1,150

1,112

HOLD

7-Feb-14

1,046

1,125

HOLD

25-Apr-14

1,310

1,263

HOLD

24-Jul-14

1,463

1,385

HOLD

31-Oct-14

1,495

1,401

HOLD

3-Feb-15

1,509

1,432

HOLD

15-Apr-15

1,614

1,485

HOLD

20-Jul-15

1,456

1,442

HOLD

21-Oct-15

1,380

1,481

HOLD

Source: Bloomberg, SSLe

SBICAP Securities Limited

(CIN): U65999MH2005PLC155485 | Research Analyst Registration No INH000000602
SEBI Registration No.: NSE Capital Market: INB 231052938 | NSE Derivatives: INF 231052938 |BSE Capital Market: INB 011053031
Currency Derivatives: INE 231052938 | CDSL: IN-DP-CDSL-370-2006 | IRDA/IR2/2014/241
Corporate Office:
Mafatlal Chambers, A-Wing, 2nd Floor, N. M. Joshi Marg, Lower Parel, Mumbai -400013.
Tel.: 91-22-42273300/01 | Fax: 91-22-42273335 | Email: sbicapresearch@sbicapsec.com | www.sbismart.com

KEY TO INVESTMENT RATINGS (w.e.f. February 2013)

Guide to the expected return over the next 12 months. 1=BUY (expected to give absolute returns of 15 or more percentage points); 2=HOLD (expected to
give absolute returns between -10 to 15 percentage points); 3=SELL (expected to give absolute returns less then -10 percentage points)

DISCLOSURES & DISCLAIMERS

Analyst Certification
The views expressed in this research report (Report) accurately reflect the personal views of the research analysts (Analysts) employed by SBICAP
Securities Limited (SSL) about any and all of the subject issuer(s) or company(ies) or securities. This report has been prepared based upon information
available to the public and sources, believed to be reliable. I/We also certify that no part of my/our compensation was, is, or will be directly or indirectly
related to the specific recommendation(s) or view(s) in this report.
The Analysts engaged in preparation of this Report or his/her relative:(a) do not have any financial interests in the subject company mentioned in this Report; (b) do not own 1% or more of the equity securities of the subject
company mentioned in the report as of the last day of the month preceding the publication of the research report; (c) do not have any material conflict of
interest at the time of publication of the Report.
The Analysts engaged in preparation of this Report:(a) have not received any compensation from the subject company in the past twelve months; (b) have not managed or co-managed public offering of
securities for the subject company in the past twelve months; (c) have not received any compensation for investment banking or merchant banking or
brokerage services from the subject company in the past twelve months; (d) have not received any compensation for products orservices other than
investment banking or merchant banking or brokerage services from the subject company in the past twelve months; (e) have not received any
compensation or other benefits from the subjectcompany or third party in connection with the Report; (f) has not served as an officer, director or employee
of the subject company; and (g) are not engaged in market making activity for the subject company.
Name

Qualification

Designation

Milind Raginwar

MBA (Finance) , LLB

Analyst

Ashutosh Adsare

B.Com, MMS (Finance)

Associate

milind.raginwar@sbicapsec.com | ashutosh.adsare@sbicapsec.com

October 21, 2015 | 5

ACC Ltd

SBICAP Securities Ltd

Other Disclosures
SBICAP Securities Limited (SSL), a full service Stock Broking company, is engaged in diversified financial services business, including equity broking, DP services, distribution
of Mutual Fund, insurance products and other financial products.SSL is a member of National Stock Exchange of India Limited and BSE Limited. SSL is also a Depository
Participant registered with NSDL & CDSL. SSL is a large broking house catering toretail, HNI and institutional clients. It operates through its branches and authorized persons
spread across the country and the clients are provided online trading through internet and offline trading through branches and call & trade facility. SSL is a wholly owned
subsidiary of SBI Capital Markets Limited (SBICAP), which is engaged into investment banking, project advisory and financial services activities and is registered with the
Securities and Exchange Board of India as a Category I Merchant Banker. SBICAP is a wholly owned subsidiary of State Bank of India. Hence, State Bank of India and all its
subsidiaries, including SBICAP and banking subsidiaries are treated and referred to as Associates of SSL.
We hereby declare that our activities were neither suspended nor we have materially defaulted with any stock exchange authority with whom we are registered in last five years.
However SEBI, Exchanges and Depositories have conducted the routine inspection and based on their observations have issued advice letters or levied minor penalty for certain
procedural lapses. We have not been debarred from doing business by any Stock Exchange/SEBI or any other authorities; nor has our certificate of registration been cancelled by
SEBI at any point of time.
SSL or its Associates may: (a) from time to time, have long or short position in, and buy or sell the securities of the company mentioned in the Report or (b) be engaged in any
other in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the company discussed
herein or act as an advisor or lender/borrower to such company or may have any other potential conflict of interests with respect to any recommendation and other related
information and opinions.
SSL does not have actual/beneficial ownership of one per cent or more securities of the subject company at the end of the month immediately preceding the date of publication of
the Report. However, since Associates of SSL are engaged in the financial services business, they might have in their normal course of business financial interests or actual /
beneficial ownership of one per cent or more in various companies including the subject company mentioned herein this Report.
SSL or its Associates might have managed or co-managed public offering of securities for the subject company in the past twelve months and might have received compensation
from the companies mentioned in the Report during the period preceding twelve months from the 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 services in a merger or specific transaction.
Compensation paid to Analysts of SSL is not based on any specific merchant banking, investment banking or brokerage service transaction.
SSL or its Associate did not receive any compensation or any benefit from the subject company or third party in connection with preparation of this Report.
This Report is for the personal information of the authorized recipient(s) and is not for public distribution and should not be reproduced, transmitted or redistributed to any other
person or in any form without SSLs prior permission. The information provided in the Report is from publicly available data, which we believe, are reliable. While reasonable
endeavors have been made to present reliable data in the Report so far as it relates to current and historical information, but SSL does not guarantee the accuracy or
completeness of the data in the Report. Accordingly, SSL or any of its Associates including directors and employees thereof shall not be in any way responsible or liable for any
loss or damage that may arise to any person from any inadvertent error in the information contained, views and opinions expressed in this Report or in connection with the use of
this Report.
Please ensure that you have read Risk Disclosure Document for Capital Market and Derivatives Segments as prescribed by Securities and Exchange Board of India before
investing in Indian securities market.
The projections and forecasts described in this Report should be carefully evaluated as these :
1.
2.
3.
4.

Are based upon a number of estimates and assumptions and are inherently subject to significant uncertainties and contingencies.
Can be expected that some of the estimates on which these were based, will not materialize or will vary significantly from actual results, and such variances may increase
over time.
Are not prepared with a view towards compliance with published guidelines or generally accepted accounting principles. No independent accountants have expressed an
opinion or any other form of assurance on these.
Should not be regarded, by mere inclusion in this report, as a representation or warranty by or on behalf of SSL the authors of this report, or any other person, that these or
their underlying assumptions will be achieved.

This Report is for information purposes only and SSL or its Associates accept no liabilities for any loss or damage of any kind arising out of the use of this report. Though
disseminated to recipients simultaneously, not all recipients may receive this report at the same time. SSL will not treat recipients as clients by virtue of their receiving this report. It
should not be construed as an offer to sell or solicitation of an offer to buy, purchase or subscribe to any securities this report shall not form the basis of or be relied upon in
connection with any contract or commitment, whatsoever. This report does not solicit any action based on the material contained herein.
It does not constitute a personal recommendation and does not take into account the specific investment objectives, financial situation/circumstances and the particular needs of
any specific person who may receive this document. The securities discussed in this Report may not be suitable for all the investors. SSL does not provide legal, accounting or tax
advice to its clients and you should independently evaluate the suitability of this Report and all investors are strongly advised to seek professional consultation regarding any
potential investment.
Certain transactions, including those involving futures, options, and other derivatives as well as non-investment grade securities, give rise to substantial risk and are not suitable
for all investors. Foreign currency denominated securities are subject to fluctuations in exchange rates that could have an adverse effect on the value or price of or income derived
from the investment.
The price, value and income of the investments referred to in this Report may fluctuate and investors may realize losses on any investments. Past performance is not a guide for
future performance. Actual results may differ materially from those set forth in projections. SSL has reviewed the Report and, the current or historical information included here is
believed to be reliable, the accuracy and completeness of which is not guaranteed. SSL does not have any obligationto update the information discussed in this Report.
The opinions expressed in this report are subject to change without notice and SSL or its Associates have no obligation to tell the clients when opinions or information in this
report change. This Report has not been approved and will not or may not be reviewed or approved by any statutory or regulatory authority in India, United Kingdom or Singapore
or by any Stock Exchange in India, United Kingdom or Singapore. This report may not be all inclusive and may not contain all the information that the recipient may consider
material.
The securities described herein may not be eligible for sale in all jurisdictions or to all categories of investors. The countries in which the companies mentioned in this Report are
organized may have restrictions on investments, voting rights or dealings in securities by nationals of other countries. Distributing /taking/sending/dispatching/transmitting this
document in certain foreign jurisdictions may be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any
such restrictions. Failure to comply with this restriction may constitute a violation of laws in that jurisdiction.

Legal Entity Disclosure

Singapore: This Report is distributed in Singapore by SBICAP (Singapore) Limited (Registration No. 201026168R), an Associate of SSL incorporated in Singapore. SBICAP
(Singapore) Limited is regulated by the Monetary Authority of Singapore as a holder of a Capital Markets Services License and an Exempt Financial Adviser in Singapore.
SBICAP (Singapore) Limiteds services are available solely to persons who qualify as Institutional Investors or Accredited Investors (other than individuals) as defined in section
4A(1) of the Securities and Futures Act, Chapter 289 of Singapore (the SFA) and this Report is not intended to be distributed directly or indirectly to any other class of persons.
Persons in Singapore should contact SBICAP (Singapore) Limited in respect of any matters arising from, or in connection with this report via email at singapore.sales@sbicap.sg
or by call at +65 6709 8651.
United Kingdom: SBICAP (UK) Limited, a fellow subsidiary of SSL, incorporated in United Kingdom is authorised and regulated by the Financial Conduct Authority. This
marketing communication is being solely issued to and directed at persons (i) fall within one of the categories of Investment Professionals as defined in Article 19(5) of the
Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the Financial Promotion Order), (ii) fall within any of the categories of persons
described in Article 49 of the Financial Promotion Order (High net worth companies, unincorporated associations etc.) or (iii) any other person to whom it may otherwise lawfully
be made available (together Relevant Persons) by SSL. The materials are exempt from the general restriction on the communication of invitations or inducements to enter into
investment activity on the basis that they are only being made to Relevant Persons and have therefore not been approved by an authorised person as would otherwise be
required by section 21 of the Financial Services and Markets Act 2000 (FSMA).

milind.raginwar@sbicapsec.com | ashutosh.adsare@sbicapsec.com

October 21, 2015 | 6