Phoenix Mills PHOMIL)

ICIC

I S

ecurit

ies –

Retail E

quit

y R

esearch

Result

Update

November 13, 2019

CMP: | 715 Target: | 870 (22%) Target Period: 12-18 months

Phoenix Mills (PHOMIL)

BUY

Delivers steady performance in Q2FY20…

Phoenix Mills’ (PML) topline grew 2.6% YoY to | 415.1 crore. Adjusting for

residential business (| 11.2 crore), core portfolio (retail, commercial &

hospitality) revenues grew 6.1% YoY to | 403.9 crore. The EBITDA margin

expanded 180 bps YoY to 50.8%. RPAT grew 6.0% YoY to | 65.8 crore,

which includes | 7.8 crore net exceptional item. Adjusting for residential

business PAT, core portfolio PAT grew 14.2% YoY to | 70.8 crore.

Festive season consumption encouraging

PML reported retail rental income growth of 7% YoY to | 259.4 crore while

retail consumption growth was slow at 1% YoY to | 1,694.8 crore in Q2FY20.

Consumption was impacted largely on account of higher area under fit outs

at a couple of assets and ongoing metro work near PMC Bangalore. On a

positive note, the festive month of October, 2019 saw consumption growth

of more than 20% over that witnessed in last year’s festive month

(November, 2018), which is encouraging. PMC Lucknow (Phoenix Palassio)

is expected to get operationalised in January/February, 2020. With this and

with more than 20% area coming up for renewals in FY21E, we expect retail

rental income to grow at a CAGR of 14.3% at | 1,690.4 crore in FY19-23E.

Commercial portfolio set to expand to ~3 msf

Commercial business revenues grew 64.0% YoY to | 26.4 crore in Q2FY20

due to higher trading occupancy of 91% at Art Guild House and incremental

revenues from Fountainhead – Tower 1. Currently, PML has 0.96 msf office

portfolio under development between Fountainhead – Tower 2&3 and at

Phoenix MarketCity, Chennai. Addition of these assets would take total office

portfolio to ~3 msf. Also, PML plans to incrementally add 3.2 msf office

assets at HSP, PMC Bangalore (Whitefield & Hebbal) and PMC Pune (Wakad).

To incur | 815 crore capex in FY20E; | 2,000 capex post FY20E

PML would incur total capex of | 815 crore in FY20E (~| 230 crore incurred

in H1FY20) towards the five under construction retail assets, leaving it with

a balance capex requirement of ~| 2,000 crore by FY20E end. This would

be funded through a mix of equity and debt. The company’s total debt was

at | 4,662.9 crore as of Q2FY20. On the tax front, PML would follow old tax

regime for two SPVs – Classic Mall Development and Island Star Mall

Developers (due to large MAT credit availability), while it is assessing tax

implications and could migrate to the new tax regime for other SPVs.

Valuation & Outlook

We remain positive on PML given its quasi play on India’s consumption

story, quality of retail & commercial assets, healthy balance sheet & strategic

expansion plans. We roll over our valuation on FY21E estimates and

maintain BUY recommendation with an SoTP based TP of | 870/share.

Key Financial Summary

(| Crore) FY17 FY18 FY19 FY20E FY21E CAGR FY19-21E

Net Sales (| crore) 1,824.6 1,619.8 1,981.6 2,024.3 2,214.1 5.7%

EBITDA (| crore) 846.9 777.4 993.2 1,038.7 1,149.6 7.6%

EBITDA margin (%) 46.4 48.0 50.1 51.3 51.9

Adj. Net Profit (| crore) 167.9 242.2 372.9 334.8 379.4 0.9%

Adj. EPS (|) 11.0 15.8 24.4 21.9 24.8

P/E (x) 65.2 45.2 26.0 32.0 28.9

EV/EBITDA (x) 17.1 18.3 14.8 14.4 13.1

Price / Book (x) 5.1 3.8 3.2 2.9 2.6

RoCE (%) 11.0 8.8 9.6 8.3 8.5

RoE (%) 7.8 8.5 10.7 8.7 9.0

Source: Company, ICICI Direct Research

Particulars

Particular Amount (| crore)

Market Capitalization 10,949.6

Total Debt 4,546.9

Cash 284.2

EV 15,212.3

52 week H/L (|) 766 / 549

Equity capital 30.7

Face value | 2

Key Highlights

Rental income grew 7% YoY to

| 259.4 crore in Q2FY20

Fit-outs at PMC Lucknow (Phoenix

Palassio) have already started. The

mall is expected to be operational in

January/February, 2020

PML is expected to incur | 815 crore

capex towards under construction

retail assets in FY20E

Maintain BUY with target price of

| 870/share

Research Analyst

Deepak Purswani, CFA

[email protected]

Harsh Pathak

[email protected]

ICICI Securities | Retail Research 2

ICICI Direct Research

Result Update | Phoenix Mills

Exhibit 1: Variance Analysis

Q2FY20 Q2FY20E Q2FY19 YoY (Chg %) Q1FY20 QoQ (Chg %) Comments

Income from Operation 415.1 447.9 404.7 2.6 615.0 -32.5 Revenue growth steady in Q2FY20

Other Income 19.5 15.0 18.3 6.5 15.4 26.5

Total raw material Expenses 11.9 76.1 22.6 -47.4 135.8 -91.2

Employee cost 39.8 31.4 39.7 0.5 38.2 4.3

Other expenditure 110.2 76.1 104.8 5.1 103.3 6.7

EBITDA 210.8 224.0 198.2 6.3 292.7 -28.0

EBITDA Margin (%) 50.8 50.0 49.0 181 bps 47.6 318 bps

Depreciation 50.9 50.7 50.6 0.6 50.7 0.5

Interest 87.8 87.1 91.7 -4.3 87.1 0.7

PBT 99.3 101.1 74.1 34.0 170.3 -41.7

Taxes 35.0 20.2 17.9 96.0 23.4 49.5

Reported PAT 65.8 70.9 62.0 6.0 130.4 -49.5


Exhibit 2: Change in estimates

FY19 FY20E FY21E

(| Crore) Old New % Change Old New % Change Comments

Revenue 1619.8 1981.6 2135.2 2024.3 -5.2 2,195.4 2214.1 0.9 We tweak our estimates

EBITDA 777.4 993.2 1104.9 1038.7 -6.0 1,171.2 1149.6 -1.8

EBITDA Margin (%) 48.0 50.1 51.7 51.3 -44 bps 53.3 51.9 -143 bps

PAT 242.2 421.0 370.4 342.6 -7.5 404.9 379.4 -6.3

EPS (|) 15.8 27.5 24.2 22.4 -7.5 26.5 24.7 -6.3

FY18

Old





Conference call Highlights

Amalgamation scheme: PML had announced an amalgamation scheme

of its subsidiary company, Phoenix Hospitality Company Pvt Ltd

(PHPCL), with PML. The company has received a no objection certificate

(NoC) from stock exchanges on this front. The effect of the merger

would be accounted for after the scheme of amalgamation is approved

by NCLT, which is expected by Q1FY21E

Management commentary: While operational malls reported overall

consumption growth of 1% YoY in Q2FY20, the festive month of

October, 2019 saw consumption growth of more than 20% over the

consumption seen in last year’s festive month (in November, 2018),

which is encouraging. Overall lower consumption in Q2FY20 was largely

due to de-growth in electronics sales at malls. At the asset level, HSP &

Palladium had higher area under fit outs. Hence, consumption was

flattish while consumption at PMC Bangalore was impacted by ongoing

metro work nearby and some stores under fit outs. At Palladium

Chennai, PML added additional ~40,000 sq ft area where food court has

been opened, which would boost consumption at the mall, going ahead

Under-development retail assets: Construction activity at PMC Lucknow

(Phoenix Palassio) is completed and the company has started handing

over spaces to retailers for fit-outs. The mall is expected to be

operational in January or February, 2020. It is expected to generate

revenue on a full year basis from FY21E. Construction at the other retail

assets is going as per schedule

Commercial portfolio: Commercial business revenues grew 64.0% YoY

to | 26.4 crore in Q2FY20 due to higher trading occupancy of 91% at Art

Guild House and incremental revenues from Fountainhead – Tower 1.

The company has 0.96 msf office portfolio under development between

Fountainhead – Tower 2&3 (0.54 msf) and at Phoenix MarketCity,

Chennai (0.42 msf). At Fountainhead Tower-2 (0.22 msf), construction is

completed up to 13th

floor (out of 16 floors), while at Tower-3 (0.35 msf),

construction up to 11th floor (out of 15 floors) is complete

Capex: PML incurred | 118 crore capex towards the five under

construction retail assets in Q2FY20 (| 111 crore incurred in Q1FY20).

The company would incur total capex of | 815 crore in FY20E, leaving it

with a balance capex requirement of ~| 2,000 crore by FY20E end

Tax rate: PML would follow the old tax regime for its two SPVs – Classic

Mall Development and Island Star Mall Developers, as these SPVs have

large MAT credit available. Since the company is assessing new tax

structure for other SPVs, it has recognised provision for income tax for

Q2FY20, H1FY20 and re-measured its deferred tax assets/liability

including MAT credit. The impact of this change will be recognised over

the period up to FY20E end. Hence, the tax rate appears to be higher in

Q2FY20

Residential business: PML clocked | 11.2 crore residential revenues in

Q2FY20 due to revenue recognition from Kessaku. PML sold ~30,000 sq

ft at Tower-7 One Bangalore West (launched in July, 2019) as of Q2FY20

Hospitality portfolio: Hospitality business revenues de-grew 6.7% YoY

to | 75.1 crore in Q2FY20. On a positive note, The St Regis, Mumbai

reported 77% room occupancy and ARR of | 11,006 in Q2FY20. The

revenue de-growth in Q2FY20 is a temporary blip. As per management,

St. Regis has highest RevPAR in its presence area, which is encouraging

Exceptional items: The company booked net exceptional item of | 7.8

crore associated with claim settlement (worth | 49 crore) and provisions

associated with write off of investment for EWDPL, write off of interest

accrued and doubtful loans




Company Analysis

Exhibit 3: Retail income trend

Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

YoY

Growth

(%)

QoQ

Growth

(%)

Avg Rental rate (|/ sq ft pm)

HSP & Palladium 378.0 403.0 392.0 406.0 383.0 1.3 (5.7)

PMC Mumbai 87.0 99.0 97.0 101.0 102.0 17.2 1.0

PMC Bangalore 118.0 124.0 118.0 124.0 126.0 6.8 1.6

PMC Chennai* 136.0 139.0 137.0 139.0 140.0 2.9 0.7

PMC Pune 114.0 123.0 116.0 125.0 124.0 8.8 (0.8)

Rental Income (| crore)

HSP & Palladium 83.4 88.6 86.8 88.1 87.9 5.4 (0.2)

PMC Mumbai 25.5 31.1 31.0 32.3 32.0 25.5 (0.9)

PMC Bangalore 34.5 36.1 34.7 35.9 36.0 4.3 0.3

PMC Chennai* 37.6 38.8 38.4 39.4 47.5 26.3 20.6

PMC Pune 38.5 41.6 40.6 43.2 42.7 10.9 (1.2)


Exhibit 4: Commercial portfolio

Office Location

Total

Area

(msf)

Area

Sold(msf)

Net Leasable

Area (msf)

Area

Leased

(msf)

Average

Rate

(|/sq ft.)

Operational

Phoenix Paragon Plaza Mumbai 0.41 0.12 0.29 0.16 106

The Centrium Mumbai 0.28 0.16 0.12 0.10 NA

Art Guild House Mumbai 0.80 0.20 0.60 0.54 101

Phoenix House Mumbai 0.20 - 0.20 0.13 NA

Fountainhead - Tower 1 Pune 0.17 - 0.17 0.16 77

Total Operational 1.86 0.48 1.38 1.09


Exhibit 5: Hospitality portfolio

Hotel Location Keys Occupancy

Avearge

room rate

per day (|)

Revenue from

Rooms Q2FY20

(| crore)

Total Revenues

Q2FY20 (|

crore)

The St. Regis Mumbai 395 77% 11,006 30.4 67.5

Courtyard by Marriot Agra 193 61% 3,309 3.5 6.6


Exhibit 6: Residential portfolio

Project LocationTotal Area

(msf)

Area

Launched

(msf)

Area Sold

(msf)

Sales Value (|

crore)

Collectionsin

Q2FY20

(| Crore)

Revenues Recognized

Cummulative (| crore)

OBW Bengaluru 2.2 1.61 1.27 1,209.5 28.6 1,209.5

Kessaku Bengaluru 0.99 0.52 0.25 340.2 3.5 340.2

Total 3.19 2.13 1.52 1,549.70 32.10 1,549.70

Source: ICICI Direct Research, Company




Exhibit 7: Under construction portfolio

Project Partnership/JV/OwnedDevelopment

Potential

Comments

PMC Wakad,

Pune

ISML - alliance with CPPIB (PML Stake:

51%)

1.6 msf

(1.1 msf retail)

All approvals received. Construction commenced in Feb 2019;

Excavation is 95% complete at end of June 2019, foundation work is

on

PMC Hebbal,

Bengaluru


51%)

1.8 msf

(1.2 msf retail)

All approvals received. Construction commenced in Feb 2019.

Excavation is 89% complete as on end of Q2FY20, foundation work

is on

PMC Indore


51%) 1.0 msf retail All approvals received, construction commenced in June 2019

Palladium,

Ahmedabad 50:50 JV with BSafal group 0.7 msf retail

Construction in Progress. Excavation is complete and foundation

work is on

PMC Lucknow 100% Owned 0.9 msf retail Construction is complete. Shops being handed over for fitouts.

Expect operations to commence during H2 FY20

Total6 msf

(4.9 msf retail)





Financial story through charts

Exhibit 8: Revenue trend

1,193

1,053

1,163

1,272

1,396

63

63

70

97

131

284

315

342

367

391

256

186

375

288

295

- 500 1,000 1,500 2,000 2,500

FY17

FY18

FY19

FY20E

FY21E

(| crore)Retail Commercial Hospitality Residential


Exhibit 9: EBITDA and EBITDA margin trend

847 777 993 1,039 1,150

46.4

48.0

50.1

51.3 51.9

40

44

48

52

56

60

-

250

500

750

1,000

1,250

FY17 FY18 FY19 FY20E FY21E

(%

)

(| crore)

EBITDA EBITDA Margin


Exhibit 10: PAT trend

168 242 421 343 379

9.2

15.0

21.2

16.9 17.1

-

4

8

12

16

20

24

50

150

250

350

450

FY17 FY18 FY19 FY20E FY21E

(%

)

(| crore)

Net Profit Net Profit Margin





Valuation & Outlook

We remain positive on PML given its quality of retail and commercial assets,

healthy balance sheet, strategic expansion plans ahead and quasi play on

India’s consumption story. With PMC Lucknow expected to be operational

in January/February, 2020 and large area coming for lease renewals at its

key retail assets in FY21E, coupled with superior quality commercial assets

bode well for the company, we expect its rental income to increase 14.3%

CAGR to | 1,690.4 crore in FY19-23E. PML is currently trading at 13.1x FY21E

EV/EBITDA. We roll over our valuation on FY21E estimates and maintain

BUY rating on the stock with an SoTP based target price of | 870/share.

Exhibit 11: Valuation

Type ParametersGAV

(| crore)

Debt

(| crore)

NAV

(| crore)

PML Value

(| crore)

Value/ share (|/

share)

Retail Leasable area (msf)

Retail Operational 5.9 13321 3392 9929 8091 507

Retail under construction 4.5 4512 1293 3219 1944 122

Retail Total 10.4 17,833 4,685 13,148 10,035 629

Commercial Leasable area (msf)

Commercial Operational 1.0 1341 114 1227 1227 77

Commercial under construction 1.8 813 0 813 758 47

Commercial Total 2.8 2,154 114 2,040 1,985 124

Hospitality No of keys

Hospitality Total 588 2,301 546 1,755 1,315 82

Residential Saleable area (msf)

Residential Total 3.7 897 165 732 578 36

Grand Total 17.0 23,184 17,675 13,913 872

Rounded Off target price 870





Exhibit 12: Recommendation History vs. Consensus

0.0

20.0

40.0

60.0

80.0

100.0

0

150

300

450

600

750

900

Nov-19Aug-19May-19Feb-19Nov-18Aug-18May-18Feb-18Nov-17Sep-17Jun-17Mar-17Dec-16Sep-16

(%

)(|)

Price Idirect target Consensus Target Mean % Consensus with BUY

Source: Bloomberg, Company, ICICI Direct Research

Exhibit 13: Top 10 Shareholders

Rank NameLatest Filing

Date

% O/S Position (m) Change (m)

1 Ruia International Holding Company Pvt. Ltd. 30-Sep-19 32.2% 49.3 0.0

2 Ruia Group 30-Sep-19 16.4% 25.2 0.0

3 Radhakrishna Ramnarain Pvt. Ltd. 30-Sep-19 7.6% 11.7 0.0

4 Nordea Funds Oy 30-Sep-19 4.5% 6.9 -0.3

5 Ruia (Atul Ashok) 30-Sep-19 2.6% 4.0 0.0

6 Fidelity Management & Research Company 30-Sep-19 2.2% 3.4 -0.1

7 Schroder Investment Management (Hong Kong) Ltd. 31-Jul-19 2.2% 3.4 0.0

8 DSP Investment Managers Pvt. Ltd. 30-Sep-19 1.9% 2.9 0.0

9 ICICI Prudential Asset Management Co. Ltd. 31-Oct-19 1.6% 2.4 0.0

10 UTI Asset Management Co. Ltd. 30-Sep-19 1.6% 2.4 0.3

Source: Reuters, ICICI Direct Research

Exhibit 14: Recent Activity

Investor name Value (m) Shares (m) Investor name Value (m) Shares (m)

Franklin Templeton Asset Management (India) Pvt. Ltd. 4.1 0.4 Ruia (Amla Ashokkumar) -24.0 -2.4

UTI Asset Management Co. Ltd. 2.7 0.3 Ruia (Gayatri Atul) -15.2 -1.5

Mirae Asset Global Investments (India) Pvt. Ltd. 1.5 0.2 Nordea Funds Oy -2.9 -0.3

Aditya Birla Sun Life AMC Limited 1.3 0.1 Reliance Nippon Life Asset Management Limited -2.1 -0.2

Wellington International Management Company Pte. Ltd. 1.3 0.1 Janus Henderson Investors -1.2 -0.1

Buys Sells

Source: Reuters, ICICI Direct Research

Exhibit 15: Shareholding Pattern

(in %) Sep-18 Dec-18 Mar-19 Jun-19 Sep-19

Promoter 62.8 62.8 62.8 62.8 59.2

Public 37.2 37.2 37.2 37.3 40.8

Others 0.0 0.0 0.0 0.0 0.0

Total 100.0 100.0 100.0 100.0 100.0





Financial summary

Exhibit 16: Profit and loss statement | crore

| crore FY18 FY19 FY20E FY21E

Net Sales 1,619.8 1,981.6 2,024.3 2,214.1

Other Income 55.6 85.1 76.6 76.4

Total revenues 1,675.4 2,066.7 2,100.9 2,290.5

Raw Material Expenses 131.9 218.9 223.6 244.6

Employee Cost 147.3 161.5 165.0 180.5

Other Expenditure 563.2 608.0 597.0 639.5

Total Operating Expenditure 842.4 988.4 985.6 1,064.5

EBITDA 777.4 993.2 1,038.7 1,149.6

Interest 347.6 350.6 357.2 383.1

Depreciation 198.3 204.2 244.3 256.1

PBT 287.1 571.6 506.0 586.7

Tax 75.8 109.9 141.7 176.0

Reported PAT 242.2 421.0 342.6 379.4

EPS (|) 15.8 27.5 22.4 24.8


Exhibit 17: Cash flow statement | crore


Profit after Tax 242.2 421.0 342.6 379.4

Depreciation 198.3 204.2 244.3 256.1

Interest paid 347.7 350.6 357.2 383.1

Cash Flow before wc changes 793.1 1,005.6 1,107.5 1,226.0

Net Increase in Current Assets 175.9 (465.7) 0.4 (115.3)

Net Increase in Current Liabilities 569.6 (251.8) (86.2) 35.3

Net cash flow from op. activities 1,517.7 207.7 880.0 969.9

Purchase of Fixed Assets (1,501.5) (1,464.5) (755.4) (838.6)

(Purchase)/Sale of Investments (1,732.4) (1,234.4) - -

Net cash flow from inv. activities (1,824.9) (1,251.6) (726.4) (805.3)

Proceeds from Long Term Borrowings 1,635.6 420.5 791.7 473.1

Interest paid (351.6) (332.9) (357.2) (383.1)

Net cash flow from fin. activities 277.4 1,052.7 446.1 111.2

Net Cash flow (29.8) 8.8 605.6 275.8

Opening Cash 64.1 30.8 192.0 797.6

Closing Cash 40.6 39.6 797.6 1,073.4


Exhibit 18: Balance sheet | crore


Equity Capital 30.6 30.7 30.7 30.7

Reserves & Surplus 2,821.1 3,443.5 3,797.7 4,198.3

Networth 2,851.7 3,474.1 3,828.3 4,229.0

Total Debt 3,666.5 4,243.5 5,035.2 5,508.3

Other financial liabilities 190.2 176.4 388.2 364.0

Deferred Tax Liability 0.2 0.3 0.3 0.3

Source of Funds 7,175 9,118 10,526 11,440

Gross Block 6,324.2 7,370.4 7,404.0 7,533.8

Less: Accumulated Dep 1,030.3 1,221.5 1,472.0 1,728.2

Net Block 5,293.9 6,148.9 5,932.0 5,805.6

Capital WIP 502.5 896.0 1,617.8 2,326.5

Total Fixed Assets 5,796.4 7,044.9 7,549.8 8,132.2

Investments 497.8 472.2 472.2 472.2

Inventories 661.5 898.6 887.4 940.2

Trade Receivables 129.2 195.5 199.7 218.5

Loans & Advances 31.6 21.2 21.7 23.7

Cash & Bank Balances 40.6 192.0 797.6 1,073.4

Other Current Assets 250.3 285.8 291.9 333.6

Total Current Assets 1,444.4 1,865.9 2,471.1 2,862.2

Trade Payable 109.5 147.7 145.4 159.0

Provisions 104.3 63.0 110.9 115.3

Other Current Liabilities 1,108.7 787.3 443.7 485.3

Total Current Liabilities 1,322.4 998.0 700.0 759.5

Net Current Assets 121.9 867.9 1,771.1 2,102.7

Application of Funds 7,175 9,118 10,526 11,440


Exhibit 19: Key ratios


Per Share Data

Reported EPS 15.8 27.5 22.4 24.8

Cash EPS 28.8 40.8 38.3 41.5

BVPS 186.2 226.9 250.0 276.1

Operating Ratios

EBITDA / Net Sales 48.0 50.1 51.3 51.9

PAT / Net Sales 15.0 18.8 16.5 17.1

Return Ratios

RoE 8.5 10.7 8.7 9.0

RoCE 8.8 9.6 8.3 8.5

RoIC 10.7 11.5 11.4 13.0

Valuation Ratios

EV / EBITDA 18.3 14.8 14.4 13.1

P/E 45.2 26.0 32.0 28.9

EV / Net Sales 8.8 7.4 7.4 6.8

Market Cap / Sales 6.8 5.5 5.4 4.9

Price to Book Value 3.8 3.2 2.9 2.6

Turnover Ratios

Asset turnover 0.2 0.2 0.2 0.2

Gross Block Turnover 0.2 0.3 0.3 0.3

Solvency Ratios

Net Debt / Equity 1.2 1.1 1.0 1.0

Current Ratio 0.8 1.4 2.0 2.0

Quick Ratio 0.3 0.5 0.7 0.8





Exhibit 20: ICICI Direct Coverage Universe (Real estate)

CMP M Cap

(|) TP(|) Rating (| Cr) FY19 FY20E FY21E FY19 FY20E FY21E FY19 FY20E FY21E FY19 FY20E FY21E FY19 FY20E FY21E

Oberoi Realty (OBEREA) 499 550 Hold 18,144 22.5 20.2 28.2 22.7 24.7 17.7 14.2 17.1 11.4 2.3 2.1 1.9 10.1 7.2 9.9

The Phoenix Mills (PHOMIL) 715 870 Buy 10,950 24.4 21.9 24.8 26.0 32.0 28.9 14.8 14.4 13.1 3.2 2.9 2.6 10.7 8.7 9.0

Brigade Enterprises (BRIENT) 215 250 Buy 4,371 11.7 9.5 4.5 18.2 22.5 47.8 9.9 10.6 9.9 2.0 1.9 1.9 11.1 8.5 3.9

P/E (x)

Sector / Company

EPS (|) EV/EBITDA (x) P/B (x) RoE (%)





RATING RATIONALE

ICICI Direct endeavors to provide objective opinions and recommendations. ICICI Direct assigns ratings to its

stocks according to their notional target price vs. current market price and then categorizes them as Buy, Hold,

Reduce and Sell. The performance horizon is two years unless specified and the notional target price is defined

as the analysts' valuation for a stock

Buy: >15%

Hold: -5% to 15%;

Reduce: -15% to -5%;

Sell: <-15%

Pankaj Pandey Head – Research [email protected]

ICICI Direct Research Desk,

ICICI Securities Limited,

1st Floor, Akruti Trade Centre,

Road No 7, MIDC,

Andheri (East)

Mumbai – 400 093

[email protected]




ANALYST CERTIFICATION

I/We, Deepak Purswani, CFA, MBA (Finance), Harsh Pathak, MBA (Finance), Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect

our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report. It is also confirmed that

above mentioned Analysts of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months and do not serve as an officer, director or employee of the companies

mentioned in the report.

Terms & conditions and other disclosures:

ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stock brokering and distribution of financial products. ICICI Securities Limited is a Sebi registered

Research Analyst with SEBI Registration Number – INH000000990. ICICI Securities Limited Sebi Registration is INZ000183631 for stock broker. ICICI Securities is a subsidiary of ICICI Bank which is India’s largest private sector bank

and has its various subsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, etc. (“associates”), the details in respect of which are available on

www.icicibank.com

ICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India. We and our associates might have investment banking and other business relationship

with a significant percentage of companies covered by our Investment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts and their relatives from maintaining a financial interest in the

securities or derivatives of any companies that the analysts cover.

Recommendation in reports based on technical and derivative analysis centre on studying charts of a stock's price movement, outstanding positions, trading volume etc as opposed to focusing on a company's fundamentals and, as

such, may not match with the recommendation in fundamental reports. Investors may visit icicidirect.com to view the Fundamental and Technical Research Reports.

Our proprietary trading and investment businesses may make investment decisions that are inconsistent with the recommendations expressed herein.

ICICI Securities Limited has two independent equity research groups: Institutional Research and Retail Research. This report has been prepared by the Retail Research. The views and opinions expressed in this document may or may

not match or may be contrary with the views, estimates, rating, target price of the Institutional Research.

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Securities from doing so. Non-rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicable regulations and/or ICICI Securities policies, in

circumstances where ICICI Securities might be acting in an advisory capacity to this company, or in certain other circumstances.

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managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.

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Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.

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