Market Outlook. Dealer s Diary

Transcription

1 Dealer s Diary The Indian markets are expected to open in green tracking positive cues from Asian markets. Asian stocks gained as manufacturing in the U.S. unexpectedly expanded in April at the fastest pace in 10 months, boosting the outlook for the region s exporters. The US markets moved sharply up in the morning trade on Tuesday; however gave up some ground before closing for the day. The rally seen in morning trading came on the heels of the release of a report from the Institute for Supply Management showing that activity in the U.S. manufacturing sector unexpectedly expanded at a faster rate in the month of April. The U.K. market got off to a positive start, but pulled back from its intraday high after the country's weaker than expected manufacturing report. The UK's manufacturing sector growth slowed in April amid sharp decline in new export orders. Indian shares meanwhile ended Monday's session on a firm note, with hopes for more monetary stimulus from the U.S. Federal Reserve underpinning sentiment. Markets Today The trend deciding level for the day is 17,291 / 5,237 levels. If NIFTY trades above this level during the first half-an-hour of trade then we may witness a further rally up to 17,387 17,455 / 5,273 5,298 levels. However, if NIFTY trades below 17,291 / 5,237 levels for the first half-an-hour of trade then it may correct up to 17,223 17,127 / 5,212 5,177 levels. Indices S2 S1 PIVOT R1 R2 SENSEX 17,127 17,223 17,291 17,387 17,455 NIFTY 5,177 5,212 5,237 5,273 5,298 News Analysis IPO Note : Samvardhana Motherson Finance Ltd. Avoid Auto sales numbers April 2012 Aditya Birla Nuvo to buy Pantaloons retail chain 4QFY2012 Result Reviews HUL, BOI, Dabur, GCPL, Exide, OBC, United Phosphorus, Punj Lloyd, KPIT, Taj GVK 4QFY2012 Result Previews Bharti AIrtel, HMCL Refer detailed news analysis on the following page Net Inflows (April 27, 2012) ` cr Purch Sales Net MTD YTD FII 2,084 2,415 (331) (2,406) 42,921 MFs (152) (676) (6,249) FII Derivatives (April 30, 2012) ` cr Purch Sales Net Open Interest Index Futures 1, ,028 Stock Futures ,447 Gainers / Losers Gainers Losers Company Price (`) chg (%) Company Price (`) chg (%) Domestic Indices Chg (%) (Pts) (Close) BSE Sensex ,319 Nifty ,248 MID CAP ,316 SMALL CAP ,765 BSE HC ,796 BSE PSU ,249 BANKEX ,829 AUTO ,646 METAL ,067 OIL & GAS ,965 BSE IT ,704 Global Indices Chg (%) (Pts) (Close) Dow Jones ,279 NASDAQ ,050 FTSE ,812 Nikkei (0.4) (40.9) 9,521 Hang Seng ,094 Straits Times (0.3) (9.9) 2,972 Shanghai Com (0.4) (8.4) 2,396 Indian ADRs Chg (%) (Pts) (Close) INFY $47.4 WIT $9.7 IBN $34.1 HDB (1.5) (0.5) $33.8 Advances / Declines BSE NSE Advances 1, Declines 1, Unchanged Volumes (` cr) BSE 1,679 NSE 8,861 Pantaloon Retail Oriental Bank 230 (4.7) Reliance Power Hindustan Copper 281 (3.5) Jain Irrigation GMR Infra 27 (3.4) Pidilite Ind Engineers India 252 (3.2) Bank of India Neyveli Lignite 82 (3.0)

2 IPO Note: Samvardhana Motherson Finance Ltd. Avoid Samvardhana Motherson Finance Ltd. (SMFL) is the principal holding company of the Samvardhana Motherson group with 18 subsidiaries, 19 Joint Ventures and 86 other consolidated entities catering to the domestic and global automotive industry. The principal investments of SMFL constitute a 36.1% stake in Motherson Sumi Systems (MSSL), 49% stake in Samvardhana Motherson Reflectec Group Holdings Ltd. (SMR, erstwhile Visiocorp) and 49% stake in Samvardhana Motherson Polymers Ltd. (SMPL). Together the three companies accounted for ~94% of the consolidated revenues in 9MFY2012. MSSL: MSSL is the flagship company of the group and is the market leader in the domestic wiring harness segment with a market share of ~65%. SMR: SMR, acquired in March 2009, is the world s second largest exterior rear view mirror manufacturer with ~22% global market share. SMPL: SMPL is engaged in the business of high quality plastic components and assemblies for exterior and interior trims for passenger vehicles through Peguform companies acquired in November SMFL s major customers include the Volkswagen group, BMW, Daimler, Renault Nissan, Ford India Private Limited, Volvo Car Corporation, Maruti Suzuki, Tata Motors, Honda Siel Cars India Limited, Toyota Kirloskar Motor Private Limited and Fiat India Automobiles Limited. Details of the issue SMFL intends to raise `1,665cr through the IPO which comprises a fresh equity issue of `1,344cr and an offer for sale of `321cr by promoter group entity, Radha Rani Holdings Pte Ltd. Objects of the issue Particulars Amount (` cr) Funding pre-payment and repayment of debt facilities Funding strategic investments in SMPL Funding investments in rear-view vision systems business General corporate purposes Total 1,344.0 Offer for sale by Radha Rani Investments Total issue size 1,665.0 Source: RHP, Angel Research Outlook and valuation SMFL has posted a 123.6% and 63.4% CAGR in revenues and earnings, respectively over FY driven largely by the acquisition of SMR. SMFL is the market leader in the domestic wiring harness (65% market share) and rear-view mirror markets (53% market share) and has a 22% share in the global exterior rear view mirrors segment. Further, acquisition of Peguform is expected to enrich its product portfolio and consolidate its in-house design, development and tooling capabilities.

3 We value SMFL s 36.1% stake in MSSL based on our target price for the company (`216 based on 15x FY2014E consolidated earnings). We value SMFL s stake in SMR and SMPL on an EV/Sales basis instead of earnings based multiples as current earnings of these companies do not reflect their true potential. Currently the profitability at SMR and SMPL has been impacted due to significant start up costs in relation to new manufacturing facilities and due to one-time costs related to the acquisition and refinancing of Peguform Group. We have assigned EV/Sales multiple of 0.5x based on our analysis of SMFL s global as well domestic peers. Based on our SOTP methodology we arrive at a value of `97/share against the IPO price band of `113-`118. Management expects to turnaround the financial performances of SMR and SMPL over the medium term. However, we believe that it is early to factor in the anticipated turnaround in these two subsidiaries and valuations in our view are not providing sufficient margin of safety to investors considering the execution risks involved in the turnaround process. Hence we recommend Avoid on the issue. SOTP valuation Equity value (` cr) % holding Value (` cr) MSSL (based on 15x FY2014E EPS) 8, ,023 SMR (based on EV/Sales of 0.5x FY2012E) 2, ,103 SMPL (based on EV/Sales of 0.5x CY2011E) 2, ,325 Value of other investments (Book value) 234 Total Equity value 5,686 Holding company discount (%) ,549 Net debt post issue (Standalone) (1,196) Final value (` cr) 5,745 Value (`/share) 97.0 Source: Company, Angel Research Auto sales numbers April 2012 Tata Motors (TTMT) TTMT registered a weak set of volumes during the month as total sales declined 7% yoy to 60,086 units. The performance during the month was impacted as commerical and passenger vehicle business registered a decline of 6% and 9% yoy, respectively. In the commercial vehicle space, M&HCV sales were the most impacted and it declined by 30% yoy during the month. In the passenger vehicle segment, Nano volumes declined 20% yoy, while Indica sales grew by robust 63% yoy, led by strong demand for diesel models. Maruti Suzuki (MSIL) MSIL reported 3.4% yoy (down 20.3% mom) growth in total volumes to 100,415 units led by strong momentum in the recently launched Swift and Dzire sales. The domestic volumes increased by 3.6% yoy to 90,255 units and exports recorded 1.5% yoy growth to 10,160 units. While the compact and super compact segments posted a strong growth of 43% and 31.5% yoy, respectively; mini segment

4 registered a decline of 26.4% yoy as lack of diesel variants continue to hurt the sales. Mahindra and Mahindra (MM) MM reported 26.9% yoy (down 14.3% mom) growth in automotive volumes to 40,719 units, driven by continued buoyancy in the four-wheeler pick-up and UV segments (led by XUV5OO) which posted a 36.9% and 31.9% yoy growth, respectively. However, the exports segment registered a decline of 18.4% yoy during the month. Hero MotoCorp (HMCL) HMCL posted a healthy 6.7% yoy (4.4% mom) growth in total volumes to 551,557 units led by momentum across the products. The company posted its highest ever monthly sales during the month surpassing the previous highest monthly sales of 5,49,625 units in September 2011 TVS Motor (TVSL) TVSL posted a modest 4% yoy (down 4.4% mom) growth in total volumes to 174,455 units as motorcycle segment witnessed a decline of 2.3% yoy during the month. Even the scooters sales posted a moderate growth of 2.2% yoy. Threewheeler and exports too witnessed a decline of 18.4% and 11.9% yoy. Mopeds on the other maintained its strong run recording a 13.8% yoy growth. Aditya Birla Nuvo to buy Pantaloons retail chain Kishore Biyani-led Future Group will spin off the branded apparel business under Pantaloon Retail into a separate entity in which Aditya Birla Nuvo will infuse `1,600cr to acquire controlling stake. As per the plan, Birla-owned Madura Garments will subscribe to some `800cr of debentures issued by Pantaloon, which, on completion of the demerger process, will convert into equity in the format. This will give Madura Garments 50.01% stake in the demerged entity and bring down promoter shareholding in it to 25%. For debt-laden Pantaloon Retail, the proposed stake sale in its retail format to Aditya Birla Nuvo will help partially ease its debt concern as once the deal is completed; the company's debt will be pruned by `1,600cr, or roughly 20% of its total debt. We do not have Pantaloon Retail under our coverage currently. Result Reviews HUL (CMP: `416/ TP: -/ Upside :-) HUL posted a 15.7% growth in its stand-alone net sales to `5,660cr. The company s domestic consumer business grew by 20.5% with a volume growth of 10.1%. OPM s stood at 14.7% up 292bp on yoy basis. The company s net profit rose by 20.5%yoy to `686cr. We will be releasing a detailed result update shortly. We continue to remain neutral on the stock.

5 Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 25, , FY2014E 29, , Bank of India (CMP: `353 / TP: `383 / Upside: 8.5%) For 4QFY2012, Bank of India posted a healthy set of numbers, with net profit growing by 93.0% yoy to `953cr, which were above our estimates on account of higher sequential rise in NIMs and lower provisioning expenses than expected by us. The bank s balance sheet growth was healthy during FY2012, with advances growing by 19.5% yoy (up 7.5% qoq) and deposits growing by 21.7% yoy (up 2.7% qoq). On a qoq basis, current account deposits witnessed strong traction growing by 13.9% qoq (up 9.9% yoy), however savings account deposits growth was muted, growing by 0.1% qoq (up a reasonable 14.3% yoy). Domestic CASA ratio improved sequentially by ~40bp qoq to 32.8%. Domestic NIMs of the bank improved by 43bp qoq in 4QFY2012 to 3.3%, on back of uptick in yield on advances (up 33bp qoq) to 12.3% on back of shift to higher yielding corporate loans and due to higher interest accrual on back of higher upgrades and recoveries. Fee income performance was robust, growing by 14.4% qoq (up 28.3% yoy) during 4QFY2012, aided by higher forex income and interest income on refund of interest tax (`108cr). The bank s NPA levels improved during 4QFY2012 with both gross and net NPA levels declining by 7.7% and 10.7% sequentially, respectively. The provisioning coverage ratio continues to remain low at 64.2% (60.9% in 3QFY2012). We recommend an Accumulate rating on the stock with a target price of `383. Y/E Op. Inc NIM PAT EPS ABV RoA RoE P/E P/ABV FY2013E 12, , FY2014E 14, , Dabur (CMP: `110/ TP: -/ Upside :-) Dabur posted a 23% growth in its consolidated net sales to `1,364cr, aided by a 12.4% volume growth. The sales of domestic business grew by 19.2% driven by strong growth in hair oil, home care and foods. OPM s stood flat on yoy basis at 16.3%. The company s net profit rose by 16%yoy to `171cr. We will be releasing a detailed result update shortly. We continue to remain neutral on the stock. Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 6, FY2014E 6,

6 GCPL (CMP: `540/ TP: -/ Upside :-) GCPL posted a 30.8% growth in its consolidated net sales to `1,323cr aided by 21%yoy growth in Indian Sub continent business. The company s international too posted a strong 27% yoy organic sales growth. OPM s rose by 115bp yoy to 18.9%. The company s net profit rose by 36%yoy to `193cr. We will be releasing a detailed result update shortly We remain neutral on the stock. Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 5, FY2014E 6, Exide (CMP: `129 / TP: Under Review) For 4QFY2012, Exide Industries (EXID) registered a strong top-line growth of 16% yoy (16% qoq) to `1,448cr driven by strong ~15% and ~26% yoy volume growth in the industrial and two-wheeler batteries segments, respectively. However fourwheeler OEM as well as the replacement segment registered a modearte 6.6% yoy growth during the quarter. On the operating front, EBITDA margin declined 403bp yoy to 14.7% led by significant increase in raw-material expenses. Raw-material cost jumped 28% yoy and accounted for 67% of sales as compared to 60% of sales in 4QFY2011. As a result, operating profit and net profit declined by 8.9% and12.9% yoy, respectively. However on a sequential basis, 147bp improvement in operating margin led to 36.6% jump in net profit to `143cr. At `129, the stock is trading at 14.5x FY2013E earnings. The stock rating is currently under review. We shall revise our estimates and release a detailed note post earnings conference call with the management. Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 5, FY2014E 6, OBC (CMP: `230 / TP: `296/ Upside: 28.7%) Oriental Bank of Commerce reported its performance for 4QFY2012. Performance was disappointing, both on the operating and asset quality front. NIMs for the bank declined by 32bp qoq, leading to sequential NII de-growth of 6.3%. The bank s asset quality moderated during the quarter with both gross and net NPA ratios improving by 25bp and 32bp qoq, respectively. However, noninterest income for the bank saw traction during the quarter growing by 16.4% qoq (14.6% yoy). Further, operating expenses for the bank increased by 8.2% qoq (39.9% yoy), leading the net profit to decline by 25.2% qoq (20.6% yoy) to `265cr. We recommend a Buy on the stock with a target price of `296.

7 Y/E Op. Inc NIM PAT EPS ABV RoA RoE P/E P/ABV FY2013E 6, , FY2014E 7, , United Phosphorus (CMP: `114 / TP: `182/ Upside: 59.6%) United Phosphorus Limited (UPL) reported consol revenues of ` 2,119cr, registering a growth of 17.4% yoy. Volumes contributed 12% to growth while price increased by 4% with the balance 2% being contributed by favorable impact of exchange. Organic growth for the quarter stood at 8% yoy. According to the regions, the main growth came in from RoW where revenues increased by 24% mainly on account of acquisitions. Europe reported revenue growth of 24% while North American revenues increased by 14%. On the other hand, India registered a 23% decline due to poor demand. On the operating front, company reported an EBITDA Margin of 19%, V/s 21% during the last corresponding period, on account of 26% yoy rise in other expenditure. Consequently the Net Profits came in at Rs240cr, registering a dip of 3%. For FY2012, the company has posted sales of `7,534cr, a rise of 33% yoy. The Margins for the year came in at 19% and the Net profit at `606cr, registering a growth of 2% yoy. Going forward, the Management has guided for 15% revenue growth in FY2013 with EBITDA margins of 18-20%, mainly driven by the Europe & North America. Also, the Management is confident about domestic growth to rebound and has plans to launch 2-3 new products. At current valuations the stock is valued at 6.1xFY2014E earnings, which is attractive. Though we would be reviewing our numbers, but at current juncture maintain a buy with a target of `182 Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 7, FY2014E 7, Punj Lloyd (CMP: `54 / TP: - / Upside: -) For 4QFY2012, Punj Lloyd (Punj) posted 32.2% yoy top-line growth to `3,038cr. The company s EBITDA margin for the quarter stood at 8.4% against 10.7% in 4QFY2011. Interest and depreciation cost came in at `187cr and `70cr, respectively. Interest cost witnessed a jump of 37.0%/15.3% on a yoy/qoq basis, respectively. On the earnings front, Punj reported profit of `9cr, registering a decline of 2.9% on a yoy basis. Order inflow for Punj in FY2012 was `13,817cr, against `9,978cr in FY2011, with an order backlog of `27,276cr (2.6x FY2012 revenue). We maintain our Neutral view on the stock.

8 Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 10, FY2014E 12, KPIT (CMP: `85 / TP: `98 / Upside: 15%) KPIT Cummins Infosystems (KPIT) reported its 4QFY2012 results which were in-line with our estimates onteh revenue as well as operating front. The dollar revenues came in at US$95.4mn, up whopping 29.9% qoq because of revenues flowing from Systime acquisition (US$~9mn). In INR terms, revenues came in at `480cr, up 26.7% qoq. EBITDA margin of the company improved by just 53bp qoq to 15.8% as the incremental growth came from Systime which has got EBITDA margin in single digits. PAT stood at `33cr, down 17.4% qoq, impacted by loss on the other income front of `11cr as against profit of `11cr in 3QFY2012. The management has given guidance of 32-35% yoyo USD revenue growth for FY2013 which is in-line with our expectations as in FY2013 revenues from Systime will flow in all the four quarters. The stock is currently under review and will be releasing a detailed result update shortly. Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E 2, FY2014E 2, TAJ GVK (CMP: `58 / TP: 116 / Upside: 100%) Taj GVK announced its 4QFY2012 results. Net sales grew by 2.3% yoy and 7.0% qoq to `71cr. EBITDA was down 25.3% yoy on back of margin compression during the quarter. The company commissioned its new property at Begumpet in November 2011, and thus all pre operating expenses were charged to the P&L. Consequently, EBITDA margin took a hit during the quarter declining by 1,057bp yoy to 28.6% (39.2%). Other expenditure as a percentage to sales increased by 1,028bp yoy to 37.6% compared to 27.4% in 4QFY2011. PAT also declined by 46.2% yoy to `7cr (`13cr) while PAT margin declined by 882bp yoy to 9.8% (18.6%). Going ahead as the Begumpet property starts contributing to the top-line, we expect margins to come back to historical levels. We currently have a Buy recommendation on the stock. We may revise our estimates and target price post an interaction with the management. Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales FY2013E FY2014E

9 Result Previews Bharti Airtel Bharti Airtel is slated to announce its 4QFY2012 results today. We expect the company to record revenue of `18,973cr, up 2.7% qoq on the back of growth in 2.2% qoq growth in ARPM to `0.46min and MOU remaining flat qoq at 418min. VAS as a share in mobility revenues is expected to move to 14.5% from 14.3% in 3QFY2012. Consolidated EBITDA margin of the company is expected to decline by 43bp qoq to 31.8%. PAT is expected to be at `1,090cr. We maintain Neutral view on the stock. Hero MotoCorp Hero MotoCorp (HMCL) is slated to announce its 4QFY2012 results today. We expect the company s top-line to grow by a healthy 12% yoy to `5,984cr driven by 8.3% yoy growth in volumes and ~3% yoy increase in average net realization led by price increases. Operating margins (adjusted for change in accounting for royalty payments) are expected to expand 36bp yoy to 12.5% on account of softening of commodity prices. As a result, we expect the bottom line (adjusted) to post a 31% yoy increase to `658cr. The stock rating is under review. Quarterly Bloomberg Brokers Consensus Estimate Hero Moto Corp Ltd - (02/05/2012) Particulars (` cr) 4Q FY12E 4Q FY11 y-o-y (%) 3Q FY12 q-o-q (%) Net sales 5,981 5, ,984 0 EBITDA EBITDA margin (%) Net profit Bharti Airtel Ltd - Consolidated (02/05/2012) Particulars (` cr) 4Q FY12E 4Q FY11 y-o-y (%) 3Q FY12 q-o-q (%) Net sales 18,937 16, ,477 2 EBITDA 6,264 5, ,964 5 EBITDA margin (%) Net profit 1,232 1,401 (12) 1, Bank of Baroda - (04/05/2012) Particulars (` cr) 4Q FY12E 4Q FY11 y-o-y (%) 3Q FY12 q-o-q (%) Net profit 1,306 1, ,290 1

10 Economic and Political News Exports down 5.7% in March at US$28.7bn Power sector needs `13.72 lakh cr for 12th Plan period: Government Bill to transfer RBI shareholding in NHB to Centre Engineering exports at US$58bn in FY2012, 19% short of target Corporate News Vodafone ups price for Mumbai postpaid users HCC Concessions bags `800cr contract from NHAI Punjab & Sind Bank cuts lending rate by 0.25% Source: Economic Times, Business Standard, Business Line, Financial Express, Mint

11 May 02, 2012 Result Calendar Date Company May 02, 2012 Bharti Airtel, Hero Motocorp May 03, 2012 Marico, Aventis, KEC International, Finolex Cables May 04, 2012 Bank of Baroda, Corporation Bank, D B Corp, ITD Cementation May 05, 2012 Grasim Inds, Allahabad Bank, IOB, Syndicate Bank, UCO Bank, United Bank, Bank of Maharashtra May 06, May 07, 2012 HDFC, Bosch India, GSK Pharma, GlaxoSmith Con, South Ind.Bank May 08, 2012 Kotak Mah. Bank, Asian Paints, Hindalco, IDFC, Shriram Trans., Central Bank, CEAT May 09, 2012 Punjab Natl.Bank, Ranbaxy, ABB, Union Bank May 10, 2012 NTPC, Lupin, Cadila Healthcare, Apollo Tyres, HEG May 11, 2012 Dr Reddy's, Thermax May 12, May 13, May 14, 2012 Mundra Port, Indraprasth Gas May 15, May 16, May 17, 2012 Bajaj Auto Source: Bloomberg, Angel Research Global economic events release calendar Date Country Event Description Unit Period Bloomberg Data Last Reported Estimated May 01, 2012 China PMI Manufacturing Value Mar India Imports YoY% % Change Feb India Exports YoY% % Change Feb UK PMI Manufacturing Value Mar May 02, 2012 Germany PMI Manufacturing Value Apr Germany Unemployment change (000's) Thousands Mar-12 (18.00) (10.00) May 03, 2012 US Initial Jobless claims Thousands 21-Apr Euro Zone ECB announces interest rates % Apr May 04, 2012 Germany PMI Services Value Apr US Change in Nonfarm payrolls Thousands Mar US Unnemployment rate % Mar May 10, 2012 China Exports YoY% % Change Mar UK BOE Announces rates % Ratio May UK Industrial Production (YoY) % Change Feb-12 (2.30) -- May 11, 2012 India Industrial Production YoY % Change Feb May 14, 2012 US Producer Price Index (mom) % Change Mar China Industrial Production (YoY) % Change Mar China Consumer Price Index (YoY) % Change Mar India Monthly Wholesale Prices YoY% % Change Mar May 15, 2012 US Consumer price index (mom) % Change Mar Source: Bloomberg, Angel Research Euro Zone Euro-Zone GDP s.a. (QoQ) % Change Dec-11 (0.30) -- Germany GDP nsa (YoY) % Change Dec

12 Market Strategy May 02, 2012 Macro watch Exhibit 1: Quarterly GDP trends Exhibit 2: IIP trends (%) (%) QFY09 4QFY09 1QFY10 2QFY10 3QFY10 4QFY10 1QFY11 2QFY11 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12 (2.0) (4.0) (6.0) Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 (5.0) Nov-11 Dec-11 Jan-12 Feb-12 Source: CSO, Angel Research Source: MOSPI, Angel Research Exhibit 3: Monthly WPI inflation trends Exhibit 4: Manufacturing and services PMI (%) 60.0 Mfg. PMI Services PMI Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Source: MOSPI, Angel Research Source: Market, Angel Research; Note: Level above 50 indicates expansion Exhibit 5: Exports and imports growth trends Exhibit 6: Key policy rates (%) 90 Exports yoy growth Imports yoy growth (%) 9.00 Repo rate Reverse Repo rate CRR Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 Source: Bloomberg, Angel Research Source: RBI, Angel Research

13 May 02, 2012 Stock Watch Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS ( ) PER(x) P/BV(x) RoE(%) EV/Sales(x) ( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E Agri / Agri Chemical Rallis Buy ,217 1,570 1, United Phosphorus Buy ,243 7,797 8, Auto & Auto Ancillary Amara Raja Batteries Buy ,508 2,691 3, Apollo Tyres Accumulate ,652 13,580 15, Ashok Leyland Buy ,408 15,008 16, Automotive Axle Neutral ,211 1, Bajaj Auto Buy 1,594 1,888 46,134 22,362 25, Bharat Forge Buy ,361 7,173 7, Bosch India Neutral 8,670-27,222 9,335 10, CEAT Buy ,057 5, Exide Industries Buy ,850 5,812 6, FAG Bearings Neutral 1,550-2,576 1,531 1, Hero Motocorp Neutral 2,184-43,602 25,852 29, JK Tyre Buy ,058 9, Mahindra and Mahindra Accumulate ,884 35,095 40, Maruti Accumulate 1,397 1,510 40,364 42,752 49, Motherson Sumi Buy ,988 23,342 26, Subros Neutral ,225 1, Tata Motors Neutral , , , TVS Motor Buy ,855 7,965 8, Capital Goods ABB* Sell ,119 8,926 10, BGR Energy Sell ,404 4,170 5, BHEL Neutral ,136 46,344 46, Blue Star Buy ,662 3,250 3, Crompton Greaves Buy ,375 12,936 14, Jyoti Structures Buy ,622 2, KEC International Buy ,500 6,865 7, LMW Buy 1,653 2,609 1,862 2,663 3, Thermax Neutral 445-5,301 5,473 5,

14 May 02, 2012 Stock Watch Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS ( ) PER(x) P/BV(x) RoE(%) EV/Sales(x) ( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E Cement ACC Neutral 1,205-22,621 11,018 12, Ambuja Cements Neutral ,851 10,035 11, India Cements Neutral 85-2,619 4,423 4, J K Lakshmi Cements Buy ,880 2, Madras Cements Neutral 143-3,395 3,434 3, Shree Cements Neutral 2,799-9,750 5,552 6, UltraTech Cement Neutral 1,417-38,845 20,116 22, Construction Ashoka Buildcon Buy ,127 2,014 2, Consolidated Co Neutral ,526 2, Hind. Const. Neutral 20-1,231 4,239 4, (1.8) (0.8) (11.3) (26.0) (9.5) (4.7) IRB Infra Buy ,644 3,821 4, ITNL Buy ,672 6,619 7, IVRCL Infra Buy ,645 5,758 6, Jaiprakash Asso. Buy ,512 16,017 18, Larsen & Toubro Buy 1,220 1,641 74,716 60,258 69, Madhucon Proj Buy ,503 2, Nagarjuna Const. Buy ,302 5,790 7, Patel Engg. Neutral ,609 3, Punj Lloyd Neutral 53-1,760 10,592 12, Sadbhav Engg. Buy ,159 2,989 3, Simplex Infra Buy ,156 6,732 7, Financials Allahabad Bank Buy ,225 7,700 8, Andhra Bank Neutral 115-6,438 5,284 5, Axis Bank Buy 1,121 1,587 46,306 16,157 19, Bank of Baroda Buy ,926 16,013 18, Bank of India Buy ,356 13,139 15, Bank of Maharashtra Buy ,019 3,665 4, Canara Bank Buy ,058 12,120 14, Central Bank Neutral 95-6,978 6,860 7,

15 May 02, 2012 Stock Watch Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS ( ) PER(x) P/BV(x) RoE(%) EV/Sales(x) ( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E Financials Corporation Bank Buy ,071 5,361 5, Dena Bank Buy ,184 3,003 3, Federal Bank Neutral 417-7,125 2,766 3, HDFC Neutral ,092 7,244 8, HDFC Bank Neutral ,460 21,831 27, ICICI Bank Buy 869 1,183 99,860 22,209 26, IDBI Bank Buy ,984 8,004 9, Indian Bank Accumulate ,161 6,469 7, IOB Buy ,926 7,328 8, J & K Bank Neutral 895-4,341 2,420 2, LIC Housing Finance Accumulate ,094 2,108 2, Oriental Bank Buy ,049 6,359 7, Punjab Natl.Bank Buy 839 1,138 26,587 20,708 24, South Ind.Bank Neutral 24-2,681 1,368 1, St Bk of India Buy 2,131 2, ,003 69,568 81, Syndicate Bank Buy ,062 7,069 7, UCO Bank Neutral 76-4,753 5,727 6, Union Bank Buy ,488 10,352 11, United Bank Buy ,352 3,666 4, Vijaya Bank Neutral 57-2,680 2,678 3, Yes Bank Buy ,346 3,209 4, FMCG Asian Paints Neutral 3,540-33,954 10,961 12, Britannia Buy ,707 5,906 6, Colgate Neutral 1,120-15,233 3,007 3, Dabur India Neutral ,250 6,010 6, GlaxoSmith Con* Neutral 2,872-12,078 3,111 2, Godrej Consumer Neutral ,920 5,904 6, HUL Neutral ,092 25,546 29, ITC Neutral ,920 28,955 33,

16 May 02, 2012 Stock Watch Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS ( ) PER(x) P/BV(x) RoE(%) EV/Sales(x) ( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FMCG Marico Neutral ,032 4,669 5, Nestle* Neutral 4,710-45,415 8,731 10, Tata Global Buy ,198 7,011 7, IT HCL Tech Accumulate ,304 22,792 25, Hexaware Neutral 129-3,823 1,821 2, Infosys Buy 2,397 2, ,631 37,615 42, Infotech Enterprises Accumulate ,788 1,758 1, KPIT Cummins Buy ,496 2,042 2, Mahindra Satyam Buy ,832 7,142 8, Mindtree Neutral 573-2,323 2,172 2, Mphasis Buy ,702 5,904 6, NIIT Buy ,105 1, Persistent Neutral 347-1,386 1,109 1, TCS Accumulate 1,203 1, ,444 57,189 66, Tech Mahindra Accumulate ,830 6,030 6, Wipro Accumulate ,924 41,918 46, Media D B Corp Buy ,748 1,656 1, HT Media Buy ,031 2,255 2, Jagran Prakashan Buy ,156 1,499 1, PVR Neutral Sun TV Network Neutral ,097 2,135 2, Metals & Mining Bhushan Steel Neutral 421-8,936 9,232 13, Coal India Neutral ,925 65,654 71, Electrosteel Castings Buy ,984 2, Hind. Zinc Accumulate ,408 13,043 14, Hindalco Accumulate ,936 84,638 88, JSW Steel Neutral ,181 39,161 43, MOIL Neutral 261-4, , Monnet Ispat Buy ,101 2,986 3,

17 May 02, 2012 Stock Watch Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS ( ) PER(x) P/BV(x) RoE(%) EV/Sales(x) ( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E Metals & Mining Nalco Reduce ,128 8,276 8, NMDC Accumulate ,640 11,726 12, SAIL Accumulate ,529 52,461 62, Sesa Goa Accumulate ,113 9,067 9, Sterlite Inds Buy ,522 45,805 49, Tata Steel Accumulate , , , Oil & Gas Cairn India Accumulate ,473 15,513 16, GAIL Buy ,885 50,472 55, ONGC Buy , , , Reliance Industries Buy , , , Pharmaceuticals Alembic Pharma Buy ,027 1,576 1, Aurobindo Pharma Buy ,817 5,243 5, Aventis* Neutral 2,247-5,174 1,401 1, Cadila Healthcare Buy 740 1,016 15,149 6,196 7, Cipla Buy ,943 7,006 8, Dr Reddy's Neutral 1,781-30,191 9,183 10, Dishman Pharma Buy ,282 1, GSK Pharma* Neutral 2,209-18,711 2,788 3, Indoco Remedies Buy Ipca labs Buy ,363 2,907 3, Lupin Buy ,121 8,272 9, Orchid Chemicals Buy ,250 2,143 2, Ranbaxy* Neutral ,420 12,023 12, Sun Pharma Accumulate ,717 9,272 11, Power CESC Buy ,129 4,927 5, GIPCL Buy ,019 1,557 1, NTPC Buy ,948 73,558 84, Real Estate Anant Raj Buy , DLF Neutral ,936 9,878 12,

18 May 02, 2012 Stock Watch Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS ( ) PER(x) P/BV(x) RoE(%) EV/Sales(x) ( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E Real Estate HDIL Buy ,327 2,441 3, Telecom Bharti Airtel Neutral ,793 80,967 88, Idea Cellular Neutral 81-26,702 22,558 25, Rcom Neutral 74-15,356 21,899 23, zothers Bajaj Electrical Buy ,984 3,670 4, CRISIL Neutral 1,034-7, , Finolex Cables Buy ,341 2, Graphite India Buy ,766 2,053 2, Greenply Buy ,800 2, Page Industries Neutral 3,164-3, , Sintex Buy ,961 5,219 5, Siyaram Silk Mills Buy ,045 1, SpiceJet Neutral 30-1,327 5,384 6,443 (1.0) 4.1 (3.4) 2.4 (8.8) 12.6 (12.2) Taj GVK Buy Source: Company, Angel Research; Note: *December year end; #September year end; &October year end; Price as on April 30, 2012

19 May 02, 2012