Unicon Research

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Long Term Investment Call

Company Report

CMP : 92 Rating : Buy Target : 143

Sector : Glass

26-Dec-11

Piramal Glass Ltd.

Investment Rationale:

Valuation:

Focus on high-margin C&P business to drive revenues:

Capacity expansion to meet the future demand:

Stronger balance sheet to support growth:

PGL believes the

market share in the C&P premium segment can grow to 7-8% over the next two

years from current levels of ~3%. PGLcurrently has a global leadership position

in the colour cosmetic (Nail polish bottles) segment with a 50% market share.

We believe that as the contribution of the C&P segment to the revenue increases

and with the share of the premium segment within the C&P segment also

increasing rapidly, will drive growth and improve margins going forward.

For FY12 and FY13, the

company has a planned capex of INR 2600 mn, with INR 1000 mn assigned to a

Greenfield expansion of 160 TPD for the C&P segment to the at Jambusar. This

project is scheduled to be operational by March 2012. The remaining INR 1600

mn will be spent on realignment of 4 existing furnaces which will increase the

capacity by ~50-60 TPD and will increase the total capacity by ~210 TPD.

PGL had a debt of INR 9200 mn (as

per FY11 Consol. balance sheet) and debt/equity of 3:1. In H1FY12 the

debt/equity ratio was reduced to 2.5:1 from 3.4:1 in H1FY11. The debt service

cover improved to 3.2 in H1FY12 as compared to 3.4 in H1FY12. PGL has been

able to restructure its debt by going into to relatively lower interest rate of 7.5%

foreign currency loan from peak rate of 13% to strength its cash flow. PGL

follows an active hedging policy to its naked exposure which is currently to the

tune of USD 12-14 mn.

Significant cost advantages Labour Arbitrage: In countries like US, which

accounts for 37% of the global C&P premium segment, 80% of the C&P

requirement is imported. The total cost of production in India, where

manpower is among the cheapest in the world is ~60% of the global costs and is

less than half of that in France and almost half of that in the US. This gives PGL

to have a significant cost advantage over its global peers.

At the CMP of ~INR 92, the stock trades at ~8.0x and 5.2x of its FY12E and FY13E

earning respectively. The company has been steadily shifting its product mix

from low margin commodity business to high yield specialized business of

C&P. We expect the C&P contribution to company's revenue to increase from

49% in FY11 to 56% in FY13E which is expected to boost EBITDA margins from

23% in FY11 to 25% in FY13E. We have valued the company at ~8x of it FY13E

earnings which is at premium compared to other domestic peers, due to PGL's

better margins profile and return ratios. We maintain our BUY rating on the

stock with a target price of INR 143.

Source: Bloomberg, Unicon Research

Ashish Tiwari |

Rohan Shetty |

atiwari5@unicon.in

rohan.shetty@unicon.in

Piramal Glass Ltd (PGL) has a multi product industrial profile and is a global leader in delivering world-class packaging solutions.

It is a manufacturer of glass containers for the Cosmetics & Perfumery (C&P), Pharmaceutical and Specialty Food & Beverages

(SF&B) industries. PGL has its manufacturing facilities in India, US and Sri Lanka with 11 furnaces having a total installed capacity

of 1145 TPD (tonnes per day).

3.0126.862

2.8621.417

(INR mn)

40

60

80

100

120

140

160

Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

Piramal Glass Nifty

Key Data

Year End

Face Value (INR)

BSE Code

Reuters Code

Bloomberg Code

Shares Outstanding (Mn)

Market Cap (INR Mn)

52 Week High/Low

BSE Sensex / CNX Nifty

1-Year Average Volume ('000)

Key Financials FY10 FY11 FY12E FY13E

Revenue 11,039 12,185 13,080 15,383

Operating Profit 1,822 2,851 2,995 3,769

Operating Profit (%) 16.5 23.4 22.9 24.5

Net Profit 32 1,033 1,038 1,543

Net Profit (%) 0.3 8.5 7.9 10.0

Book Value 30 38 49 67

Key Ratio FY10 FY11 FY12E FY13E

P/E (x) 168.0 8.0 8.0 5.2

P/BV (x) 3.1 2.5 1.9 1.4

RONW (%) 1.3 34.2 26.3 28.7

ROCE (%) 8.8 16.3 15.6 20.1

Share Holding Pattern

Promoters

FII

FI/MF/Other Institutes

Others 23.7

Relative Price Performance

7,465

156/79

0.6

15970 / 4779

78

3.4

72.3

Mar

10

PIRAMGLAS

PRML.BO

PIRA IN

804.4

Piramal Glass Ltd.

2Unicon Research

www.unicon.in

CONTENTS

Particulars Page

Company Background ..............................................................................................................................................3

Milestones ....................................................................................................................................................................4

Industry Overview ......................................................................................................................................................5

Business Overview ......................................................................................................................................................8

Investment Rationale ................................................................................................................................................10

Concerns ....................................................................................................................................................................13

Peer Comparison ......................................................................................................................................................13

Valuation & Outlook ................................................................................................................................................13

Financial Statements ................................................................................................................................................14

Piramal Glass Ltd.

3Unicon Research

www.unicon.in

Piramal Glass Ltd (PGL) has a multi product industrial profile and is a global leader indelivering world-class packaging solutions. It is a manufacturer of glass containers forthe Cosmetics & Perfumery (C&P), Pharmaceutical and Specialty Food & Beverages(SF&B) industries. PGL has its manufacturing facilities in India, US and Sri Lanka with11 furnaces having a total installed capacity of 1145 TPD. International operationscontributed to 74% of FY11 revenues. PGL commands ~3-4% market share in worldpremium C&P segment and ~50% market share in colour cosmetics C&P segment. Itcontrols ~35% market share in domestic pharmaceutical segment and ~91% marketshare in SF&B segment in Sri Lanka. The Company has offices in 10 countries and adistribution network in 44 countries. PGL is also the largest producer of nail-polishbottles globally.

COMPANY BACKGROUND

54% 44% 39% 37%39% 31% 28% 11%

17%18%

18% 18%

24%26% 23% 30%

30%

39%

43%45%

36%44%

49% 35%

0

200

400

600

800

1000

1200

FY05 FY06 FY07 FY08 FY09 FY10 FY11

Pharma SF&B C&P

Segment-wise CAGR

(From FY 05 to FY 11

annualized)

Sales CAGR : 24%

336

493

701779

1008

1104

1218

Segment Contribution & GrowthSegment wise breakup

Source: Company, Unicon Research Source: Company, Unicon Research

C&P

49%

Pharma

28%

SF&B

23%

End

Product

Price

Bottle Price

1000 Pcs

Market

Segment

Market Size

Total market : US $ 2.3 bnROCE

$ 1016 (44%)

$ 616 (27%)

$ 500 (22%)

$ 155

(7%)

Select

Perfumes

Mass Perfumes

& Skin Care

Low Mass Perfumes

Color Cosmetics

$ 60

$ 15

$ 8

$ 1.5

$ 330 - $ 1000 +

$ 160 - $ 330

$ 85 - $ 160

$ 20 - $ 40

25 - 30 %

20 - 25 %

15 - 20 %

15 - 20 %Mas

sS

egm

ent

Mas

sS

egm

ent

Pre

miu

mS

egm

ent

Pre

miu

mS

egm

ent

>

>

>

>

>

>

>>

>>

>>

>>

>

>

Market Overview

Source: Company, Unicon Research

Piramal Glass Ltd.

4Unicon Research

www.unicon.in

Source: Company, Unicon Research

1984

1990

1998

1999

2003

2005

2008

Gujarat Glass

acquired by

Piramal Group

Merges with

group company

Nicolas Piramal

India Ltd.

(NPIL) and

becomes its

division

Demerges as

subsidiary, PE

investors buy

45% in the

demerged entity

Acquires Ceylon

Glass Company

Ltd., Sri Lanka,

And marks entry

into SF&B

segment

NPIL demerges

its 54% holding

to Kojam Finvest

which gets listed

Kojan merges

into Gujarat

Glass Ltd., which

gets relisted

as PGL

PGL turnaournds

after three years

of consecutive

losses

Acquires a part

of The Glass Group

(erstwhile Wheaton

Glass) and marks

entry into

premium C&P

market

2010

MILESTONES

Piramal Glass Ltd.

5Unicon Research

www.unicon.in

INDUSTRY OVERVIEW

Indian Glass Packaging

The Indian Packaging Industry is a USD 14 bn industry and has been growing at ~15%over the last few years. The industry is expected to accelerate further due to increasingurbanization, growing middle class and expansion in modern retail. The Indian glasscontainer market stood at ~ USD 1 bn in FY10 and grew by ~12% YoY. The industry hassignificant entry barriers due to the capital intensive nature of the business. Theindustry has strong economic drivers for end-user segments (liquor and beer,pharmaceuticals, food, cosmetics, etc.)

The liquor and beer industries are the main users of container glass with ~70%contribution, followed by pharmaceuticals ~10%, food products ~10%, beverages ~6%and cosmetics ~4%.

• The Indian Made Foreign Liquor (IMFL) segment has been registering a strong12% CAGR over the past four years. The alcohol consumption has increased inthe recent past due to growing inclination towards social drinking and higherdisposable income. This in turn is expected to drive container glass demand.

• The Indian pharmaceuticals industry is expected to grow to ~USD 37 bn by2013 from the levels of USD 17 bn in 2008. Glass bottles and molded vialsrepresent a significant share of packaging medium for cough syrups, tonics,pediatric suspensions, dry powder and liquid injectibles. Moreover, tubularvials and ampoules are finding an extensive acceptance by pharmaceuticalcompanies for their product packaging.

• In India, currently 10-12% of all food and beverages are packed in containerglasses, vis-à-vis 40-50% in developed economies. India’s retail food sector isexpected to grow to ~USD 150 bn by 2025 (from the levels of USD 70 bn in 2008).The fruit-drinks category is growing at 25% annually, one of the fastest in thebeverages market. Even sports and energy drinks, with low penetration inIndia, are expected to grow in the coming years. Attractive packaging besidesinnovative advertising and celebrity endorsements has gained importance inproducts marketing.We believe this growth will drive the demand forprocessed food packaging, especially container glass as it is considered nonreactive and food-grade.

We believe growth in India’s retail food sector will drive the demand for processedfood packaging, especially container glass as it is considered non reactive and food-grade.

Piramal Glass Ltd.

6Unicon Research

www.unicon.in

World Glass Container per capita consumption (kg)

Source: Company, Unicon Research

1.2

1.4

4.8

5.5

5.9

9.5

10.2

10.5

10.6

14.4

18.8

19.5

22.5

27.5

27.5

30.3

35.6

36.5

38.8

50.3

50.5

52.5

63.9

89.0

Indonesia

India

Brazil

Turkey

China

Greece

Japan

Belgium

Phillippines

Chile

Argentina

Mexico

Hungary

USA

UK

Poland

Austria

Czech Republic

Ireland

Spain

Germany

Italy

France

South korea

India’s per capita consumption of container glass, at 1.4 per kg, is far lower than theglobal average, indicating an immense growth potential.

Piramal Glass Ltd.

7Unicon Research

www.unicon.in

Global Glass Packaging

The World Packaging Organization estimates the global packaging industry to haverevenues of USD 425 bn, with a ten year historical CAGR growth of ~3.1% and isexpected to grow to USD 597 bn by 2014. The industry is projected to grow at ~3.5%CAGR in the next five years mainly driven by growth in emerging markets.

Global Glass Packaging Market Size

Glass Packaging

$ 30 bn

Moulded Glass

Packaging

$ 28 bn

Tubular Glass

Packaging

$ 2 bn

Food &

Beverages

$ 24.1 bn

Pharmaceuticals

$ 2.0 bn

Cosmetics &

Perfumery

$ 2.3 bn

Specialty Food

& Beverages

$ 1.3 bn

Addressable niche global markets

Sources: Industry reports, Market size in FY 08-09/ CY-08

Addressable niche “high value glass” market

Market size ~ 20% of overall market

34%

34%

27%

5%Europe

Asia, Oceana, Africa & ME

North America

South & Central America

52%

15%

11%

9%

13%

Liquor

Beer

Food

Pharma

Others

Geography End User

The global glass packaging market size is estimated to be at USD 30 bn. With C&Psegment having a size of USD 2.3 bn, Pharmaceuticals having a market size of USD2 bn and SF&B having a size of USD 1.3 bn.

Source: Owens-Illinois, Inc. - Investor Presentation, March 2010

Piramal Glass Ltd.

8Unicon Research

www.unicon.in

Gerresheimer

8%

Vitro

8%

Zignago Brosse

11%

Bormiolli Luigi

6%

Heinz

16%SGD

16%

Pochet

10%

Bormiolli Rocco

6%

Piramal Glass

6%

Others

13%

C&P market share

Source: Company, Unicon Research

PGL currently commands 5.8% market share in the ~ USD 2.3 bn Cosmetic &Perfumery (C&P) segment which has significant entry barriers like high qualityand skill requirements. PGL is the latest global entrant into this segment and hasgrown by CAGR of 19% over the last 3 years. PGL also holds the distinction of beingthe only major player in this segment from Asia and hence has a significant costadvantage over its peers in the segment due to the comparatively low cost ofmanufacturing glass in India compared to other developed markets.

The C&P segment constitutes the mass segment and the premium segment. Thesesegments are further divided as follows:

Mass Segment

• Colour Cosmetics: - This segment constitutes of nail polish bottles whoseprice ranges from USD 20-40 per 1000 bottles. The growth in the segment isdriven by the emerging economies particularly China and Brazil. Thismarket is very fragmented and regionalized and requires new designs,particularly in the mass market.

• Low Mass Perfumes: - This segment constitutes of perfume bottles with anend prices in the range of USD 8 and are primarily sold in emergingeconomies. The price range in the segment is USD 85-160 per 1000 bottles.The market is fragmented and characterised by frequent new productlaunches and short production runs. Customers in this segment preferintegrated packaging (Caps, Cartons etc.). Low mass perfumes are the easiestto produce in terms of quality and have higher manufacturing efficiencies.Competition in this space is driven by regional players in China and Poland.

BUSINESS OVERVIEW

Piramal Glass Ltd.

9Unicon Research

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End

Product

Price

Bottle Price

1000 Pcs

Market

Segment

Market Size

Total market : US $ 2.3 bnMarket

$ 1016 (44%)

$ 616 (27%)

$ 500 (22%)

$ 155

(7%)

Select

Perfumes

Mass Perfumes

& Skin Care

Low Mass Perfumes

Color Cosmetics

$ 60

$ 15

$ 8

$ 1.5

$ 330 - $ 1000 +

$ 160 - $ 330

$ 85 - $ 160

$ 20 - $ 40

France

& USA

West Europe,

North America

& Latin America

Middle East, CIS

Turkey, SE Asia,

India.

Across Globe

Mas

sS

egm

ent

Mas

sS

egm

ent

Pre

miu

mS

egm

ent

Pre

miu

mS

egm

ent

Premium constitutes about 71% of overall C&P market

>

>

>

>

>

>

>>

>>

>>

>>

>

>

Market Overview

Source: Company, Unicon Research

Premium Segment

• MNC Mass Segment: - Perfumes and Skincare products with an end pricein the range of USD 15 and produced primarily for developed economies.The price range in the segment is USD 160-330 per 1000 bottles. This marketis characterised by higher quality products with stringent plant auditsbefore business development. This segment has a product developmentcycle of around 6-8 months and long production runs. Customers are mainlyfrom developed economies in West Europe and North America.

• Perfumes Select Segment: - This segment comprises of high end perfumeswith an end price greater than USD 60 produced mainly in France andUSA. The price range of the segment is USD 330-1000+ per 1000 bottles. Thesegment has an extremely high entry barrier due to the specific skillrequired. A concentrated customer base of 20 customers constitutes around80% of the market. The suppliers in this segment are mainly based in theEU and USA. The segment has a product development cycle of 12-18 monthsand customers conduct extensive periodic audits of the manufacturingplants. Bottle decoration accounts for ~40% of bottle cost due high labourintensity in decoration and quality sorting.

Piramal Glass Ltd.

10Unicon Research

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INVESTMENT RATIONALE

Focus on high-margin C&P business to drive revenues

PGL has 5.8% market share in USD 2.3 bn global C&P segment. The company hasattained a global leadership position in the colour cosmetics and low mass perfumessegments with 50% and 10% market share respectively. The company has adopted along term strategy which focuses on increasing the market share in the high marginpremium segment which has a better ROCE as compared to the mass segment. Thecompany has shown a steady increase in revenue contribution of premium segment tothe total C&P revenue over the last few years. PGL currently has a market share of 3-4% in the premium segment; the management believes that the company is wellpositioned to grow its market share to 7-8% over the next two years, which in-turnwould contribute to revenue and margin growth. We believe that the contribution ofthe C&P segment to the total revenue will increase to ~ 53% and 56% in FY12E andFY13E respectively. With the change in the product mix in the C&P segment and itsgrowing contribution to the overall business will drive margins and revenue goingforward.

C&P is a high value business commandingbetter realization & higher operating margin

75%72% 62% 68% 57% 55%

54%25%

28%38% 32%

43%45%

46%

0

1000

2000

3000

4000

5000

6000

7000

8000

FY06 FY07 FY08 FY09 FY10 FY11 FY13E

Premium Mass

CAGR : 26%

CAGR : 26%

Premium CAGR of 28-30%

Premium C&P Growth Trajectory

Source: Company, Unicon Research

Piramal Glass Ltd.

11Unicon Research

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Significant cost advantages - Labour Arbitrage

Flacconage is a labour and skill intensive industry. Though the manufacturing of glassitself is highly automated, critical functions such as quality control need large teams ofskilled professionals. In countries like US, which accounts for 37% of the global C&Ppremium segment, 80% of the C&P requirement is imported thus giving significantadvantage to companies having manufacturing facilities in countries which have lowerlabour costs. The total cost of production in India, where manpower is among thecheapest in the world, is less than half of that in France and almost half of that in the US.The project costs in India amount to ~60% of the global costs. PGL is able to produceglass at significantly lower costs than its competitors in other parts of the world givingthe company a significant advantage over its peers. For FY11, global sales accountedfor 74% of the total sales. We believe that the global sales will increase further over thenext two years and contribute ~75% of the total sales.

Cost India France

Freight 6 1

Overheads 10 12

Depreciation 7 12

Mold cost 1 4

Labour 4 53

Energy 8 8

Packing material 4 4

Raw material 6 6

Total 46 100

Sustainable Cost Advantage

Source: Company, Unicon Research

0

20

40

60

80

100

120

India France

Raw material

Co

st

Packing material

Energy

Labour

Mold cost

Depreciation

Overheads

Freight

Capacity expansion to meet the future demand

Between FY12-FY13, the company has a planned capex of INR 2600 mn, with INR 1000mn assigned to a Greenfield expansion of 160 TPD for the C&P segment to the at Jambusar.This project is scheduled to be operational by March 2012. The remaining INR 1600 mnwill be spent on realignment of 4 existing furnaces which will increase the capacity by~50-60 TPD and will increase the total capacity by ~210 TPD. PGL has strategicallyfocussed on expanding its C&P furnace capacities as it has higher margins. We believethat with the further capacity expansion will enable the company to capture highermarket share in the C&P segment.

Piramal Glass Ltd.

12Unicon Research

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Strong client base

PGL derives 74% of its revenues from global sales. PGL's acquisition of Glass Group,USA gave it access to 37 % of the global C&P premium segment. Today, PGL has expandedits customer base to 17 of top 20 top customers which constitute ~80% of premiummarket. These being premium brands have quite stringent eligibility criteria for itsvendors which include environmental norms, design norms, design history, etc. Thecompany has reputed brands like Coty, Elizabeth Arden, Estee Lauder, L'Oreal, Revlon,Unilever, etc as its customers which enable PGL to maintain regular order flows due tothe nature of the business where clients do not regularly change their vendors. Moreover,such reputed clients, help to form a quality client portfolio.

Stronger balance sheet to support growth

PGL had a debt of INR 9200 mn (as per FY11 Consol. balance sheet) and debt/equity of3:1. In H1FY12 the debt/equity ratio was further reduced to 2.5:1 from 3.4:1 in H1FY11.The debt service cover improved to 3.2 in H1FY12 as compared to 3.4 in H1FY12. PGLhas been able to restructure its debt by going into to relatively lower interest rate of7.5% foreign currency loan from peak rate of 13% to strength its cash flow. The Indianoperations have foreign debt of USD 40 mn in form of PCFC and will have a minimalimpact on the P&L due to the receivables (Exports to the range of 60% of standalonesales). Other foreign currency loan are in their respective currency (USA - USD 60mn &Sri Lanka -USD 40 mn) which is only for the translation and has a natural hedgebecause of the distribution of their foreign currency denominated assets and liabilities.PGL follows an active hedging policy to its naked exposure which is currently to thetune of USD 12-14 mn. Moreover, the company is also planning one time sale of 21 acresof land in Sri Lanka in FY12 with an estimated value of ~ INR 300-400 mn will gotowards debt servicing. Given the strong cash flows from operations, we believe thatthe debt equity ratio will improve to 1.6 in FY13E.

Piramal Glass Ltd.

13Unicon Research

www.unicon.in

CONCERNS

Revenue concentration from few clients

80% of C&P revenues are generated from the top 20% C&P clients. Any order executiondelays or failure on the part of PGL to retain such clients can dent revenues of thecompany.

Currency Risk

PGL is subject to risks from fluctuations in the currency as exports contributesubstantially to its revenues.

At the CMP of ~INR 92, the stock trades at ~8.0x and 5.2x of its FY12E and FY13E earningrespectively. The company has been steadily shifting its product mix from low margincommodity business to high yield specialized business of C&P. We expect the C&Pcontribution to company's revenue to increase from 49% in FY11 to 56% in FY13Ewhich is expected to boost EBITDA margins from 23% in FY11 to 25% in FY13E. Thecompany's increasing focus on C&P business, significant cost advantage over its com-petitors in other parts of the world would able PGL to increase its market share in C&Pspecially premium segment.

Most of the domestic peers are trading at a one year forward multiple of 3.6x-5.6x butare not exactly comparable given the difference in product mix and target markets.Globally glass companies which have similar product mix are commanding an aver-age P/E multiple of 10.1x. We have valued the company at ~8x of it FY13E earningswhich is at premium compared to other domestic peers, due to PGL's better marginsprofile and return ratios. We maintain our BUY rating on the stock with a target priceof INR 143.

VALUATION & OUTLOOK

PEER COMPARISON

Domestic Peers

FY12 FY13 FY12 FY13 FY12 FY13 FY12 FY13

HSIL Ltd 125.0 8,250.0 17.0 22.8 7.3 5.4 1.0 0.9 5.3 4.0

HNG 144.9 12,655.4 19.1 28.5 7.6 5.1 0.9 0.8 4.5 2.9

Piramal Glass 92.0 7,464.5 11.5 17.8 8.0 5.2 1.9 1.4 5.8 5.7

International Peers

CY11 CY12 CY11 CY12 CY11 CY12 CY11 CY12

Zignago Vetro SpA 4.5 360.0 0.4 0.5 10.3 9.7 4.5 2.8 5.6 5.3

Gerresheimer AG 32.1 1,007.5 2.3 2.6 13.9 12.5 1.9 1.7 6.5 6.0

SGD 28.9 15,480.4 3.3 3.5 8.7 8.2 0.8 0.8 5.0 4.9

EV / EBITDACompany

Price

(EUR)

Market Cap

(mn)

EPS P/E P/B

CompanyEV / EBITDAPrice

(INR)

Market Cap

(mn)

EPS P/E P/B

Piramal Glass Ltd.

14Unicon Research

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FINANCIAL STATEMENTS

Source: Company, Unicon Research

Profit & Loss FY09 FY10 FY11E FY12E FY13E Balance Sheet FY09 FY10 FY11E FY12E FY13E

Total Revenue 10,088 11,039 12,185 13,080 15,383 SOURCES OF FUNDS

growth % 29.6 9.4 10.4 7.3 17.6 Share Capital 180 804 804 804 804

Total operating expenditure 9,348 9,218 9,333 10,085 11,614 Reserves & Surplus 254 1,595 2,216 3,143 4,577

EBITDA 740 1,822 2,851 2,995 3,769 Shareholder's Funds 434 2,399 3,020 3,948 5,381

EBITDA Margin % 7.3 16.5 23.4 22.9 24.5 Total Loans 13,571 9,824 9,200 9,600 8,541

Other Income 209 221 215 226 237 Deferred Tax Liab./ (Asset) 93 113 143 143 143

Depreciation & Amortisation 892 907 1,069 1,107 1,205 Total Liabilities 14,544 12,713 12,862 14,300 14,784

Interest 1,314 1,049 720 818 744 APPLICATION OF FUNDS

PBT -1,258 87 1,277 1,297 2,058 Gross Block 14,052 13,673 15,174 16,441 17,974

PBT Margin % -12.5 0.8 10.5 9.9 13.4 Less: Accu. Depreciation 4,489 5,252 6,580 7,686 8,891

Total Tax -186 54 244 259 514 Net Block 9,562 8,421 8,595 8,755 9,084

% of PBT 14.8 62.6 19.1 20.0 25.0 Capital Work-in-Progress 148 141 402 1,277 352

Reported PAT -1,072 32 1,033 1,038 1,543 Investments 1 1 1 1 1

growth % -572.7 N.A. 3095.7 0.4 48.7 Current Assets 6,429 5,873 6,349 6,822 8,183

PAT Margin % -10.6 0.3 8.5 7.9 10.0 Current Liabilities 1,033 1,070 1,326 1,397 1,677

Adjusted PAT -1,118 44 930 928 1,433 Net Current Assets 4,834 4,150 3,865 4,267 5,348

Adjusted PAT Margin % -11.1 0.4 7.6 7.1 9.3 Total Assets 14,544 12,713 12,862 14,300 14,784

Cash Flow FY09 FY10 FY11E FY12E FY13E Ratios FY09 FY10 FY11E FY12E FY13E

PBT -1,258 87 1,277 1,297 2,058 Per Share Data (INR)

Depreciation 892 907 1,069 1,107 1,205 Adj. EPS -62.2 0.6 11.6 11.5 17.8

Interest 1314 1049 720 818 744 Adj. Cash EPS -10.0 11.7 26.1 26.7 34.2

Change in Working Capital -465 260 228 0 0 BookValue 24.1 29.8 37.5 49.1 66.9

Other Exp/(Inc)

Cash Flow from Operations -253 2,580 3,195 2,285 2,192 Operating Ratios

Purchase of Fixed Assets/WIP -1,645 -244 -1,508 -2,142 -608 Inventory (days) 103.3 84.1 75.0 78.0 82.8

Sale of Fixed Assets 97 36 5 - - Debtors (days) 97.3 87.1 83.3 84.0 86.8

Other Exp/(Inc) - - - 226 237 Creditors (days) 27.1 29.6 30.8 30.7 32.7

Cash Flow from Investments -1,547 -208 -1,502 -1,916 -371 Debt / Equity (x) 31.3 4.1 3.0 2.4 1.6

(Repayment)/ Proceeds From Borrowings 3,158 -3,150 -624 400 -1,059

Proceeds from Right Issue - 625 - - - Returns (%)

Share Premium Received - 1,232 - - - RONW -247.2 1.3 34.2 26.3 28.7

Interest Paid -1,322 -1,059 -703 -818 -744 ROCE 0.5 8.8 16.3 15.6 20.1

Cash Flow from Financing 1,832 -2,352 -1,420 -418 -1,803

Inc./(Dec.) in Cash 32 21 272 -49 19 Valuation Ratios (x)

Opening Cash balances 86 118 71 133 84 P/E (x) -1.5 168.0 8.0 8.0 5.2

Closing Cash balance 118 71 133 84 102 P/CashEPS (x) -9.2 7.9 3.5 3.5 2.7

P/BV (x) 3.8 3.1 2.5 1.9 1.4

EV/Total Sales (x) 1.5 1.5 1.6 1.4 1.3

EV/EBITDA (x) 11.8 20.4 9.4 5.8 5.7

Piramal Glass Ltd.

15Unicon Research

www.unicon.in

RESEARCH RECOMMENDATIONS

Date of

RecommendationCompany Name Report Type Sector Recommendation

Recommended

PriceTarget

24-Sep-11 Development Credit Bank Ltd. Initiating Coverage Banking Buy 46.0 64.0

15-Sep-11 Supreme Infrastructure India Ltd. Investment Idea Constructions Buy 230.0 280.0

30-Aug-11 Persistent Systems Ltd. Initiating Coverage Information Technology Buy 309.0 381.0

2-Aug-11 Tamil Nadu News Print Ltd. Initiating Coverage Paper & Paperboard Buy 117.0 161.0

18-Jul-11 KEC International Ltd. Initiating Coverage Power Transmission Buy 79.0 104.0

12-Jul-11 Visa Steel Ltd. Investment Idea Metal Buy 59.0 75.0

30-Jun-11 Tecpro Systems Ltd. Investment Idea Material Handling Buy 250.0 300.0

16-May-11 Camson Biotechnologies Ltd. Investment Idea Agri Biotech Buy 116.0 156.0

4-May-11 Ganesh Polytex Ltd. Initiating Coverage Waste Recycling Buy 62.0 102.0

28-Apr-11 CESC Ltd. Initiating Coverage Power Buy 311.0 411.0

1-Apr-11 Unity Infraprojects Ltd. Investment Idea Infrastructure Buy 69.0 86.0

31-Mar-11 Rolta India Ltd. Investment Idea IT / ITES Buy 139.0 191.0

29-Mar-11 West Coast Paper Mills Ltd. Investment Idea Paper & Paperboard Buy 77.0 95.0

7-Mar-11 Hindusthan National Glass & Industries Ltd. Initiating Coverage Glass Buy 212.0 351.0

28-Feb-11 Deepak Fertilisers & Petrochemicals Ltd. Initiating Coverage Fertilisers Buy 152.0 202.0

3-Feb-11 Ceat Ltd. Investment Idea Auto Ancillaries Buy 109.0 149.0

31-Jan-11 MIC Electronics Ltd. Initiating Coverage Led Display & Lighting Buy 31.6 51.0

12-Jan-11 Diamond Power & Infrastructure Ltd. Initiating Coverage Power Buy 193.0 257.0

31-Dec-10 Hathway Cable & Datacom Ltd. Initiating Coverage Media Buy 164.0 227.0

31-Dec-10 Jindal Poly Films Ltd. Investment Idea Packaging Accumulate 525.0 620.0

31-Dec-10 Allahabad Bank Investment Idea Banking Buy 225.0 304.0

22-Dec-10 Sasken Communication Tech. Ltd. Investment Idea IT / ITES Buy 168.0 226.0

30-Nov-10 Banco Product Initiating Coverage Auto Buy 93.0 149.0

30-Nov-10 Allcargo Global Logistics Investment Idea Shipping & Logistics Buy 155.0 233.0

18-Nov-10 Jyoti Structure Investment Idea Power Buy 137.0 171.0

16-Nov-10 Pennar Industries Investment Idea Steel Buy 49.0 63.0

3-Nov-10 HSIL Ltd. Initiating Coverage Building Product Buy 141.0 171.0

27-Oct-10 IDBI Bank Initiating Coverage Banking Buy 171.0 228.0

26-Oct-10 MSP Steel and Power Initiating Coverage Steel Buy 72.0 114.0

29-Sep-10 Nakoda Textiles Investment Idea Textiles Buy 15.0 23.0

16-Sep-10 Kajaria Ceramics Investment Idea Ceramic Tiles Buy 70.0 88.0

15-Sep-10 Gokul Refoils Investment Idea Food Processing Accumulate 97.3 109.0

14-Sep-10 Aqua Logistic Investment Idea Logistic Hold 59.1 60.8

31-Aug-10 Lakshmi Precision Screws Investment Idea Fastner Accumulate 79.8 91.8

27-Aug-10 BGR Energy System Initiating Coverage Power Buy 786.0 1020.0

30-Jul-10 Patel Engineering Initiating Coverage Infrastructure Buy 416.0 480.0

26-Jul-10 KPR Mills Ltd. Investment Idea Textiles Accumulate 156.0 181.0

14-Jul-10 IDBI Bank Investment Idea Banking Accumulate 125.0 142.0

9-Jul-10 Opto Circuit Initiating Coverage Healthcare Buy 243.0 293.0

26-Jun-10 BGR Energy System Ltd. Investment Idea Capital Goods Accumulate 697.0 820.0

23-Jun-10 Biocon Ltd. Investment Idea Pharmaceuticals Buy 321.0 387.0

19-Jun-10 Emmbi Polyarns Investment Idea Packaging Buy 15.6 26.0

18-Jun-10 Indian Bank Investment Idea Banking Buy 221.0 276.0

17-Jun-10 Diamond Power & Infrastructure Ltd. Investment Idea Power Ancillary Accumulate 196.0 226.0

12-Jun-10 Man Industries Investment Idea Steel Pipes Buy 85.0 102.0

5-Jun-10 Usher Agro Investment Idea Food Processing Buy 79.0 110.0

10-May-10 Greaves Cotton Investment Idea Construction Buy 67.0 82.0

30-Apr-10 Indraprastha Gas Ltd. Initiating Coverage Gas Distribution Buy 233.0 290.0

Piramal Glass Ltd.

16Unicon Research

www.unicon.in

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