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ApcotexIndustriesLtd

InorganicStrategy(1+1=11)

STOCKINFO
Co.Name
ApcotexIndustries
Bse
523694
Nse
APCOTEXIND
Bloomberg
APCO.BO
Reuters
APCO.IN
Sector
Chemical
FaceValue(Re)
5
EquityCapital(RsMn)
52
MktCap(RsMn)
5,682
52wH/L(Rs)
361/181.5
AvgDailyVol(BSE+NSE)
16,751

SHAREHOLDINGPATTERN
(asonMarch2016)

Institutions
Others
Promoters

0.03
42.1
57.87

April27,2016

Apcotex Industries Ltd is one of the leading producers of Performance Emulsion


PolymersinIndia.Thecompanywasestablishedintheyear1980asadivisionof
AsianPaints(India)Ltd.In1991thedivisionwasspunoffasaseparatecompany,
whichwasheadedbyMr.AtulChoksey,formerMDofAsianPaints.Thecurrent
MD & CEO of Apcotex is Abhiraj Choksey. Apcotexs products are used as
applications for Tyre Cord Dipping, Paper/Board Coating, Carpet Backing,
Construction (Concrete Modification, Water Proofing, etc.), Paints, Textile
Finishing and Automotive Components. The companys high Styrene Synthetic
Rubberfindsapplicationsinfootwear,automotivecomponents,vbelts,conveyer
belts and hoses. Acquisition of OMNOVA solutions led to monopoly position in
Synthetic Rubber and brings the access to unique technology to manufacture
NitrileLatex.WerecommendBUYwithTPofRs.444(20.0xFY18E)onthestock.

OMNOVAAcquisitionKeyGameChanger
InternalWorkoutstoTurnaroundOMNOVABottomLine

STOCKPER.(%)

Apcotex
Sensex

1m

3m

12m

21%
3%

41%
6%

24%
4%

SustainableBusinessAdvantage
BusinessEfficiency+PortfolioStrengthening

Source:Capitaline,IndiaNiveshResearch

StrongR&DCapability

Apcotexv/sSENSEX
150.00
140.00

NewVision=NextFiveYearPlan

130.00
120.00
110.00
100.00
90.00

80.00
70.00

Apcotex

Sensex

Source:Capitaline,IndiaNiveshResearch

14/04/2016

31/03/2016

17/03/2016

03/03/2016

18/02/2016

04/02/2016

21/01/2016

07/01/2016

24/12/2015

10/12/2015

26/11/2015

12/11/2015

29/10/2015

15/10/2015

01/10/2015

17/09/2015

03/09/2015

20/08/2015

06/08/2015

23/07/2015

09/07/2015

25/06/2015

11/06/2015

60.00

Risk&Concerns

DelayinOMNOVAIntegration
Failure/DelayinNewProductLaunch
LeadingMarketShareCapsGrowthOpportunity

Valuation

At CMP of Rs. 275, the stock is trading at P/E multiple of 18.0x FY17E and 12.4x
FY18E estimates. The companys technology, experience and clientele have
emerged as the significant entry barrier. This has led to capture of lions market
share in all the industry verticals in which Apcotex is operating today. The
managementsnewfiveyearvisionandtrackrecordofexecutingaspertheplan
should lead to next level of revenue growth and margin expansion goingahead.
WerecommendBUYwithTPofRs.444(20.0xFY18E)onthestock.

DaljeetS.Kohli
HeadofResearch
Tel:+912266188826
daljeet.kohli@indianivesh.in

AmarMourya
ResearchAnalyst
Tel:+912266188836
amar.mourya@indianivesh.in

IndiaNiveshResearch

InitiatingCoverage

InvestmentRationale

Source:BSE

28/05/2015

Previous

Rating:NA
Target:NA

14/05/2015

Current
CMP:Rs.275
Rating:BUY
Target:Rs.444

30/04/2015

Y/e
Mar.31

Sales
(RsMn)

Y/Y EBITDA Margin Adj.PAT


(%) (Rsmn)
(%) (RsMn)

Y/Y
(%)

EPS
(Rs)

Y/Y ROE
(%) (%)

ROCE
(%)

P/E
(x)

FY15A

3,551 19.5

422 11.9

247 88.0

11.9 88.0

24.7

28.5 23.1

FY16E

3,462 2.5

401 11.6

228 7.7

11.0 7.7

19.2

21.0 25.0

FY17E

5,470 58.0

525 9.6

316 38.9

15.3 38.9

22.7

21.7 18.0

FY18E

6,564 20.0

892 13.6

460 45.5

22.2 45.5

26.4

34.2 12.4

Source:IndiaNiveshResearch

IndiaNiveshSecuritiesLimited|ResearchAnalystSEBIRegistrationNo.INH000000511
601&602,SukhSagar,N.S.PatkarMarg,GirgaumChowpatty,Mumbai400007.Tel:(022)66188800
IndiaNiveshResearchisalsoavailableonBloombergINNS,ThomsonFirstCall,ReutersandFactivaINDNIV.

InitiatingCoverage(contd...)

InvestmentRationale
OMNOVAAcquisitionKeyGameChanger
Apcotexacquired100%stakeofOmnovaSolutionsPvtLtd(OSIPL)for~Rs360mnon5thFeb.,
2016. The acquisition was funded entirely through internal accruals. The company plans to
invest additional ~Rs 250300 mn over shorttomediumterm for debottlenecking and
process improvement. Acquisition will help the company to get entry into high growth
Automotive,Footwear,LPGTubing,andWire&Cablesindustry.InFY15,OSIPLtoplinestood
atRs1870mnwithPBTlevellossof~Rs103mn.Apcotexsrichdistributionnetwork,cross
sellingopportunityatOSIPLlevel,andabilitytoimprovequalityofOSIPLexistingproductline
shoulddrivetherevenuegrowthandprofitability.ManagementtargetsOSIPLrevenueCAGR
of 25% (Rs 1870 mn in Nov FY15 to Rs 4,000 in FY18E) over next threeyears. Additionally,
efficient development of manufacturing processes and enhancement of productivity should
leadtoturnaroundinprofitability.Thedealiscloselyalignedwiththecompanyslongterm
strategy to tap full potential of emulsion polymers industry. OSIPL is the only producer of
nitrilerubber(NRB)inIndiaandsecondlargestproducerofhighstyrenerubber(HSR)after
Apcotex. Thus this deal brings new growth opportunity along with operational efficiency
whichcouldleadtohigherprofitability.

M&A Impact
GROWTHOPPORTUNITY

SYNERGY

FINANCIAL IMPLICATION

Entery intonewindustry(Automotive,
Footwear,LPGTubing,andWire&Cables)
onbackofOSIPLNitrile Latexproducts
(Nitrile Rubber/Powder/Bale/PVC
Blends).OSIPListheonlyproducerofNitril
LatexinIndia.

SyntheticRubber(SR)Capacity
APCOTEX~7,500MTPA
OSIPL~9,000MTPA(Likelytoshiftthe
capacitytoNBR)
"PostM&Athecompanywouldemergeas
themonoployplayerinSRsegment"

Total~9,000MTPAofmarketandlargely
dominatedby import.

WC&CashConversionCyclecouldgoup
initialy,asApcotexhas33DaysofCCCycle
(v/s121DaysforOSIPL).
Weexpectdeferedtaxbenefit,which
couldleadtoreductionintaxat
consolidatedlevel,asOSIPLwasinlosses
fromlastmanyyears.TAXbenefitcould
beintherangeof~Rs100140mn.

ChartRevenueFY15(RsMn)

Chart:CashConversionCycleFY15(Days)

Chart:EBITDAFY15(RsMn)

3,551

121

422
1,870

33

87
OSIPL

Apcotex

Apcotex

OSIPL

Apcotex

OSIPL

Source:CompanyFilings;IndiaNiveshResearch

InternalWorkoutswillTurnaroundOSIPLOperations
Despiteoperatingintothenicheindustry(NitrileLatex)andlionsmarketshareinSynthetic
Rubber,OSIPLcontinuedtopostlossesatoperatinglevel.Thekeyreasonswereasfollows:
(1)Lackofbuyerpower,(2)Lowerutilizationlevel(4550%),(3)Lackofsupplierpower,and
(4)Lackofexperienceleadership.Apcotexalreadypossesssupplierandbuyerpowerandhas
abilitytooperateathigherutilizationlevel(Current65%|High85%).Theconsolidationwill
further enhance the buyer and supplier power. The combined company will emerge as
monopolyplayerinSyntheticRubbersegment.GiventhelargestbuyerofStyrene(360tons)
andoneofthelargestbuyerofButadiene(360tons)inthecountry,Apcotexshouldfurther
strengthen its supplier power, as input material is same for Nitrile Latex. Installation of
effluent treatment plant (ETP) in Valia Plant (OSIPL Plant) will lead to increase in plant
utilizationandefficientallocationofresources(like~115Acresofattachedland).
SupplierPower(CRDAYS)
BuyerPower(DRDAYS)

EBT(RsMn)

45
40
35
30
25
20
15
10
5
0

60
91
Nov14

Nov13

82
Nov15E

Source:CompanyFilings;IndiaNiveshResearch

32
Apcotex
16

FY13

90
80
70
60
50
40
30
20
10
0

41

41

16

FY14

16

OSIPL

FY15E

83
62

83

83

63
49
Apcotex
OSIPL

FY13

FY14

FY15E

(contd...)

April27,2016|2

InitiatingCoverage(contd...)

SustainableBusinessAdvantages
Thecompanyhasvarioussustainablebusinessadvantagesaroundthebusiness.Theyareas
follows: (1) Technology the technology to mix and handle water and oil is available only
with handful players, (2) Raw Material Handling creating system and facility to handle
explosive, toxic & inflammable raw material (like Butadiene, Acrylic Acid, Acrylonitrile,
Styrene, and 2 VP Monomers) requires special experience, (3) Customer Approvals the
approvalcyclefromclientandgovernmentrangesbetween6monthto3years.Theclient
stickness is also very high, given that minor fluctuation in latex quality could alter the end
productperformanceandeminencesignificantly,(4)PlantAutomationPlantautomation
leadstoscalabilityofoperationsandreductioninpercapitacostwhichisnoteasytoexecute
withoutanypriorexperienceinthesimilarprocess.
Chart:SustainableBusinessAdvantage

StrongR&DCapability
ApcotexpioneeredtheproductionofVinylPyridineLatex(TyreLatex)inIndia.Additionally,
the company internally developed technology for Carboxylated Styrene Butadiene Latexes
(PaperandPaperboards&CarpetLatex),AcrylicLatexes(PaintLatex)andNonCarboxylated
Styrene Butadiene Latexes (Nitrile Latex) along with synthetic rubber. This strengthens our
viewthatthecompanyhasstrongR&Dcapabilitiesandgoingaheadwecouldseefewmore
productslaunchintotalnewindustry.Further,OSIPLsultramodernR&DCentrededicatedto
newtypesofdrypolymers,polyblendsandpowdersshouldstrengththeproductportfolio.

NewVision=NextFiveYearPlain
Themanagementarticulatedfiveproductstrategyinpastandtakentheirexistingproducts
marketsharetothesignificantlevelinlastfiveyears.Giventhatthefirstfiveyearvisionwas
achieved, management identified five new products in Performance Emulsion Polymers
(LatexSegment)andwantstotaketheseproductsmarketsharetothenextlevel.Inorderto
execute these five product strategy the company has chosen inorganic route and acquired
OSIPL.ThedealhelpedthecompanytogetentryintothreenewindustriesAutomotive,LPG
Tubing, andWire & Cables. In our view, the company is positioned todeliver next level of
growthandlikelytoreachRs10bnrevenuemarkfromRs.3.4bninFY16E.Inourview,the
recentacquisitionsalongwithexistingproductshouldhelpthecompanytoreach~Rs.9.4bn
mark. Any launch of new product in performance emulsion polymers segment will further
boosttherevenueoutlook.

Y/E31Mar
(RsMn)
Apcotex
Y/YGr%
OSIPL's
Y/YGr%
Total
Y/YGr%

Revenue
FY16E
FY17E
FY18E
FY19E
FY20E
3,000 3,480 3,898 4,365 4,889
15.5%
12.0%
12.0%
12.0%
12.0%
311* 2,000 2,666 3,511 4,563
NM
16.0%
16.0%
20.0%
20.0%
3,462 5,470 6,564 7,877 9,452
2.5%
58.0%
20.0%
20.0%
20.0%

Source:Companyfilings,IndiaNiveshResearchNote:*Onlyfor2months

(contd...)

April27,2016|3

InitiatingCoverage(contd...)

BusinessEfficiency+PortfolioStrengthening

Apcotexstotalmarketshareinsyntheticrubbersegmentisnearly45%oftotalIndiamarket.
Similarly,OSIPLmarketsharestoodataround40%insyntheticrubbersegment.Asaresult,
we see significant synergies across manufacturing, raw material procurement, distribution
and inventory management. Further, the acquisition strengthens the existing nitrile latex
portfolio of the company. Earlier Apcotex was having only one product in the Nitrile Latex
segment. Postacquisition the companys Nitrile Latex product line expanded to total four
products (See Table Below). The overall market size of the Nitrile Latex is nearly 20,000
MTPA(~Rs1400mn)andOSIPListheonlyproducerinIndia.Asaresult,weareoftheview
that goingahead management could attract the significant market share in Nitrile Latex
segment.

(FormerOSIPL)

RevenueMix(Range)
Syntheti cRubber

1012%

Pa per

4145%

Tyre

810%

Ca rpet

910%

Cons tructi on

910%

Auto

79%

Texti l e

12%

Pa i nt

12%

NewProductDetails
ProductName

Application

Automobi l e Ga s ke t&Bra ke Shoe Li ni ng


AUTOMOTIVECompone nts ,Ri ce De Hus ki ngRol l s ,Rubbe r
Ni tri l e Rubbe r/Powde r/Ba l e Hos e s &Othe rIndus tri a l Appl i ca ti on
LPGTubi ng,Wi re&Ca bl e s ,Conve yorBe l ts ,DoorSe a l s ,
Moul de dAutoPa rts
Ni tri l e /PVCBl e nds
Ha wa i i Sl i ppe rs ,Footwe a r,Mi croce l l ul a rShe e t,a nd
Abra s i onRe s i s ta ntRubbe r
Hi ghStyre neRubbe r

APCOTEXPBN100

Source:Companyfilings,IndiaNiveshResearch

(contd...)

April27,2016|4

InitiatingCoverage(contd...)

Valuation
At CMP of Rs. 275, the stock is trading at P/E multiple of 18.0x FY17E and 12.4x FY18E
estimates. The companys technology, experience and clientele have emerged as the
significant entry barrier. This has led to capture of lions market share in all the industry
verticals in which Apcotex is operating today. The managements new five year vision and
track record of executing as per the plan should lead to next level of revenue growth and
marginexpansiongoingahead.WerecommendBUYwithTPofRs.444(20.0xFY18E)onthe
stock.

FY14

Interim Result

FY16

FY15

Q1
747
4.3%

Q2
700
-0.4%

Q3
709
16.5%

Q4
803
14.6%

Q1
1023
36.9%

Q2
898
28.2%

Q3
846
19.3%

Q4
Q1
Q2
Q3
767
667
675
652
-4.5% -34.8% -24.8% -22.9%

COGS
As a % of sales

(595)
79.6%

(554)
79.2%

(572)
80.6%

(661)
82.3%

(794)
77.6%

(697)
77.7%

(634)
74.9%

(518)
67.5%

(479)
71.8%

(495)
73.3%

(460)
70.6%

SG&A
As a % of sales

(95)
12.8%

(86)
12.3%

(80)
11.3%

(81)
10.1%

(131)
12.8%

(102)
11.4%

(116)
13.7%

(144)
18.8%

(95)
14.2%

(89)
13.1%

(101)
15.6%

R&D expenditure
As a % of sales

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

0
0.0%

EBITDA
EBITDA margin

57
7.6%

60
8.5%

57
8.1%

61
7.5%

98
9.6%

99
11.0%

96
11.4%

105
13.7%

93
14.0%

92
13.6%

90
13.8%

Depreciation
As a % of sales

(14)
1.9%

(18)
2.5%

(18)
2.6%

(18)
2.2%

(24)
2.3%

(23)
2.5%

(21)
2.5%

(22)
2.9%

(21)
3.1%

(25)
3.7%

(22)
3.4%

EBIT
EBIT Margin

43
5.7%

42
6.0%

39
5.5%

43
5.3%

74
7.2%

76
8.5%

75
8.9%

83
10.8%

73
10.9%

67
10.0%

68
10.4%

(3)

(0)

(0)

18

10

10

46

39

39

43

82

94
10.4%

85
10.1%

88
11.5%

83
12.4%

71
10.6%

68
10.5%

(7)
14.9%

(15)
36.8%

(8)
20.4%

(6)
14.1%

(24)
29.4%

(22)
24.0%

(25)
29.1%

(30)
34.4%

(22)
26.5%

(18)
25.5%

(22)
31.7%

Net Incom e
Net Margin

39
5.2%

25
3.6%

31
4.4%

37
4.6%

58
5.6%

71
7.9%

60
7.1%

58
7.5%

61
9.1%

53
7.9%

47
7.2%

EPS - Basic
EPS - Diluted
Shares outstanding - Basic
Shares outstanding - Diluted

1.87
1.87
20.74
20.74

1.20
1.20
20.74
20.74

1.49
1.49
20.74
20.74

1.76
1.76
20.74
20.74

2.78
2.78
20.74
20.74

3.43
3.43
20.74
20.74

2.91
2.91
20.74
20.74

2.79
2.79
20.74
20.74

2.94
2.94
20.74
20.74

2.57
2.57
20.74
20.74

2.25
2.25
20.74
20.74

Consolidated
Sales
Change (%) Y-o-Y

Net financials & Other incom e


Earnings before Tax
PBT Margin
Taxes
% of Profits
Minority Interest
Post tax exceptionals

Source:Companyfilings,IndiaNiveshResearch

(contd...)

April27,2016|5

InitiatingCoverage(contd...)

ConsolidatedFinancials

IncomeStatement(Consolidated)

YEMarch(Rsm)
Netsales
Growth(%)
Operatingexpenses
Operatingprofit
Otheroperatingincome
EBITDA
Growth(%)
Interest
Depreciation
Otherincome
AssociateIncome
EBIT
Financecost
Exceptionalitem
Profitbeforetax
Tax(current+deferred)
Profit/(Loss)fortheperiod
Associates,MinInt
Reportednetprofit
Extraordinaryitem
Adjustednetprofit
Growth(%)
Source:Company,IndiaNiveshResearch

FY14

FY15

FY16E

FY17E

FY18E

2,970
8.6
2,713
257
0
257
8.4
47.1
68
24
0
166
0
0
166
35
131
0
131
0
131
2.5

3,551
19.5
3,128
422
0
422
64.4
40.1
90
56
0
348
0
0
348
102
247
0
247
0
247
88.0

3,462
2.5
3,061
401
0
401
5.0
26.0
114
12
0
273
0
0
273
45
228
0
228
0
228
7.7

5,470
58.0
4,945
525
0
525
30.7
26.0
181
0
0
318
0
0
318
2
316
0
316
0
316
38.9

6,564
20.0
5,672
892
0
892
70.0
26.0
217
0
0
650
0
0
650
189
460
0
460
0
460
45.5

BalanceSheet(Consolidated)

YEMarch(Rsm)

FY14

FY15

FY16

FY17E

FY18E

Sharecapital
Reserves&surplus
NetWorth
MinorityInterest
TotalLiabilities
Noncurrentliabilities
Longtermborrowings
Deferredtaxliabilities
OtherLongtermliabilities
Longtermprovisions
CurrentLiabilities
Shorttermborrowings
Tradepayables
OthercurrentLiabilities
Shorttermprovisions
TotalLiabilitiesandEquity

NonCurrentAssets
NetBlock
Goodwill
NoncurrentInvestments
Longtermloansandadvances
DeferredtaxAssets
OthernoncurrentAssets
CurrentAssets
Inventories
SundryDebtors
Cash&BankBalances
OthercurrentAssets
Loans&Advances
CurrentInvestments

52
801
853
0
853
506
480
0
27
0
475
0
339
136
0
1,834

52
945
998
0
998
342
311
0
31
0
467
0
318
149
0
1,807

52
1,344
1,397
0
1,397
342
311
0
31
0
898
0
599
299
0
2,637

52
1,691
1,743
0
1,743
342
311
0
31
0
882
0
683
199
0
2,967

1,010
689
0
321
0
0
0
824
171
517
61
74
0
0

1,025
651
0
373
0
0
0
782
152
487
44
99
0
0

52
1,132
1,184
0
1,184
342
311
0
31
0
904
0
304
599
1
2,429

926
926
0
0
0
0
0
1,503
171
465
375
493
0
0

996
996
0
0
0
0
0
1,641
300
944
149
249
0
0

996
996
0
0
0
0
0
1,971
486
989
347
149
0
0

Total(Assets)

1,834

1,807

2,429

2,637

2,967

Source:Company,IndiaNiveshResearch

(contd...)

April27,2016|6

InitiatingCoverage(contd...)

CashFlowStatement(Consolidated)

YEMarch(Rsm)

FY14

FY15

FY16

FY17E

FY18E

Profitbeforetax
Depreciation
Changeinworkingcapital
Totaltaxpaid
Others
Cashflowfromoperations(a)
Capitalexpenditure
Changeininvestments
Others
Cashflowfrominvesting(b)
Freecashflow(a+capex)
Equityraised/(repaid)
Debtraised/(repaid)
Dividend(incl.tax)
Others
Cashflowfromfinancing(c)
Netchangeincash(a+b+c)
Cashatthebegning
Cashattheendoftheyear

189
68
122
35
23
77
124
0
0
124
47
0
7
52
0
45
92
154
62

333
90
13
102
16
324
104
0
0
104
220
0
164
73
0
237
17
62
44

287
114
46
45
14
388
16
0
0
16
373
0
0
41
0
41
331
44
375

344
181
369
2
26
128
250
0
0
250
122
0
0
104
0
104
225
375
149

676
217
147
189
26
530
217
0
0
217
313
0
0
114
0
114
199
149
347

Source:Company,IndiaNiveshResearch

KeyRatios(Consolidated)

YEMarch

AdjustedEPS(Rs)
Growth
Dividend/share(Rs)
Dividendpayoutratio
EBITDAmargin
EBITmargin
NetMargin
Taxrate(%)
Debt/Equity(x)
InventoryDays
SundryDebtorDays
TradePayableDays
DuPontAnalysisROE
Netmargin
Assetturnover(x)
Leveragefactor(x)
ROE(%)
RoCE(%)
Valuation(x)
PER
PCE
Price/Book
EV/EBITDA
Source:Company,IndiaNiveshResearch

FY14

FY15

FY16

FY17E

FY18E

6.3
2.5
2.5
39.5
8.6
5.6
4.4
21.1
0.6
23
64
46

4.4
1.7
0.6
15.4
12.5

43.4
203.8
47.6
23.4

11.9
88.0
7.0
58.8
11.9
9.8
7.0
29.1
0.3
18
50
37

7.0
2.0
0.3
24.7
26.6

23.1
120.5
40.7
14.2

11.0
7.7
2.0
18.2
11.6
7.9
6.6
16.6
0.3
20
49
36

6.6
1.6
0.3
19.2
18.3

25.0
118.6
34.3
15.0

15.3
38.9
5.0
32.8
9.6
5.8
5.8
0.6
0.2
22
63
44

5.8
2.2
0.2
22.7
18.6

18.0
81.6
29.0
11.5

22.2
45.5
5.5
24.8
13.6
9.9
7.0
29.1
0.2
31
55
44

7.0
2.3
0.2
26.4
31.6

12.4
59.9
23.3
6.7

(contd...)

April27,2016|7

InitiatingCoverage(contd...)

Disclaimer:ThisreporthasbeenpreparedbyIndiaNiveshSecuritiesLimited(INSL)andpublishedinaccordancewiththeprovisionsofRegulation18oftheSecuritiesandExchangeBoardofIndia
(ResearchAnalysts)Regulations,2014,forusebytherecipientasinformationonlyandisnotforcirculationorpublicdistribution.INSLincludessubsidiaries,groupandassociatecompanies,promoters,
directors,employeesandaffiliates.Thisreportisnottobealtered,transmitted,reproduced,copied,redistributed,uploaded,publishedormadeavailabletoothers,inanyform,inwholeorinpart,for
anypurposewithoutpriorwrittenpermissionfromINSL.Theprojectionsandtheforecastsdescribedinthisreportarebaseduponanumberofestimatesandassumptionsandareinherentlysubjectto
significant uncertainties and contingencies. Projections and forecasts are necessarily speculative in nature, and it can be expected that one or more of the estimates on which the projections are
forecastswerebasedwillnotmaterializeorwillvarysignificantlyfromactualresultsandsuchvariationswilllikelyincreaseovertheperiodoftime.Alltheprojectionsandforecastsdescribedinthis
report have been prepared solely by authors of this report independently. None of the forecasts were prepared with a view towards compliance with published guidelines or generally accepted
accountingprinciples.
Thisreportshouldnotbeconstruedasanoffertosellorthesolicitationofanoffertobuy,purchaseorsubscribetoanysecurities,andneitherthisreportnoranythingcontainedthereinshallformthe
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themmaygoupaswellasdown,andinvestorsmayrealizeprofit/lossontheirinvestments.Pastperformanceisnotaguideforfutureperformance.Actualresultsmaydiffermateriallyfromthoseset
forthintheprojection.
Exceptforthehistoricalinformationcontainedherein,statementsinthisreport,whichcontainwordssuchaswill,would,etc.,andsimilarexpressionsorvariationsofsuchwordsmayconstitute
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update/followup.
Followingtablecontainsthedisclosureofinterestinordertoadheretoutmosttransparencyinthematter;

DisclosureofInterestStatement
1

DetailsofbusinessactivityofIndiaNiveshSecuritiesLimited(INSL)

DetailsofDisciplinaryHistoryofINSL

12

Research analyst or INSL or its relatives'/associates' financial interest in the subject company and
natureofsuchfinancialinterest
WhetherResearchanalystorINSLoritsrelatives'/associates'isholdingthesecuritiesofthesubject
company
Research analyst or INSL or its relatives'/associates' actual/beneficial ownership of 1% or more in
securities of the subject company, at the end of the month immediately preceding the date of
publicationofthedocument.
ResearchanalystorINSLoritsrelatives'/associates'anyothermaterialconflictofinterestatthetime
ofpublicationofthedocument
HasresearchanalystorINSLoritsassociatesreceivedanycompensationfromthesubjectcompany
inthepast12months
HasresearchanalystorINSLoritsassociatesmanagedorcomanagedpublicofferingofsecuritiesfor
thesubjectcompanyinthepast12months
HasresearchanalystorINSLoritsassociatesreceivedanycompensationforinvestmentbankingor
merchantbankingorbrokerageservicesfromthesubjectcompanyinthepast12months
Has research analyst or INSL or its associates received any compensation for products or services
otherthaninvestmentbankingormerchantbankingorbrokerageservicesfromthesubjectcompany
inthepast12months
HasresearchanalystorINSLoritsassociatesreceivedanycompensationorotherbenefitsfromthe
subjectcompanyorthirdpartyinconnectionwiththedocument.
Hasresearchanalystservedasanofficer,directororemployeeofthesubjectcompany

13

HasresearchanalystorINSLengagedinmarketmakingactivityforthesubjectcompany

No

14

Otherdisclosures

No

4
5

6
7
8
9
10

11

INSLisaStockBrokerregisteredwithBSE,NSEandMCXSXinallthemajorsegments
viz. Cash, F & O and CDS segments. INSL is also a Depository Participant and
registered with both Depository viz. CDSL and NSDL. Further, INSL is a Registered
PortfolioManagerandisregisteredwithSEBI.
Nodisciplinaryactionis/wasrunning/initiatedagainstINSL
No (except to the extent of shares held by Research analyst or INSL or its
relatives'/associates')
YES
No

No
No
No
No
No

No
No

INSL,itsaffiliates,directors,itsproprietarytradingandinvestmentbusinessesmay,fromtimetotime,makeinvestmentdecisionsthatareinconsistentwithorcontradictorytotherecommendations
expressedherein.Theviewscontainedinthisdocumentarethoseoftheanalyst,andthecompanymayormaynotsubscribetoalltheviewsexpressedwithin.Thisinformationissubjecttochange,as
perapplicablelaw,withoutanypriornotice.INSLreservestherighttomakemodificationsandalternationstothisstatement,asmayberequired,fromtimetotime.
Definitionsofratings
BUY.Weexpectthisstocktodelivermorethan15%returnsoverthenext12months.
HOLD.Weexpectthisstocktodeliver15%to+15%returnsoverthenext12months.
SELL.Weexpectthisstocktodeliver<15%returnsoverthenext12months.
Ourtargetpricesareona12monthhorizonbasis.
Otherdefinitions
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NM=NotMeaningful.Theinformationisnotmeaningfulandisthereforeexcluded.
ResearchAnalysthasnotservedasanofficer,directororemployeeofSubjectCompany
OneyearPricehistoryofthedailyclosingpriceofthesecuritiescoveredinthisnoteisavailableatwww.nseindia.comandwww.economictimes.indiatimes.com/markets/stocks/stockquotes.(Choose
nameofcompanyinthelistbrowsecompaniesandselect1yeariniconYTDinthepricechart)

IndiaNiveshSecuritiesLimited

ResearchAnalystSEBIRegistrationNo.INH000000511
601&602,SukhSagar,N.S.PatkarMarg,GirgaumChowpatty,Mumbai400007.
Tel:(022)66188800/Fax:(022)66188899
email:research@indianivesh.in|Website:www.indianivesh.in

(contd...)

April27,2016|8