Hero Motocorp. Motoring ahead. Company Report

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1 Change in Estimates Rating Target Motoring ahead Scooters and rural markets to drive volume Rising proportion of working women preferring scooters for personal mobility and increasing appeal to the youth will continue to drive higher than industry growth for the scooters segment of the two wheeler industry. While the weakness in urban India sentiment will continue to persist for motorcycle demand, strong rural demand driven by higher incomes will more than offset the impact. with increasing market share in the scooters segment, strongest presence in rural markets and robust line up of new models will be able to retain its market share in spite of fierce competition. Quantum jump in exports seen Under the JV with the Honda group, was restricted to exports to markets where Honda had an erstwhile presence. The split up has now enabled the company to enter newer markets. In the initial stages the company has entered 8 markets and has plans to enter other markets in Middle East and Africa. So far the key companies present in these markets have <100cc motorcycle as their key product. With having leadership position in that segment in domestic markets, it is well poised to make inroads and garner market share. With the technological tie ups the company has made in the recent past its building a robust line up of products enabling them to enter developed markets. Strong earnings CAGR, Valuations attractive While domestic volumes for will grow in line with the industry 8 10% CAGR in the next couple of years, exports are likely to see a substantial jump. Realizations will see a modest rise of 2% on back of increasing proportion of scooters and premium motorcycles. With OPM expected to expand by 100bps (with an upward bias) over the next couple of years and sharp decline expected in royalty, earnings growth is expected to be at 30% during FY14E 16E. Given the robust earnings CAGR, valuations are attractive at P/E of 11.7x FY16E EPS of Rs We maintain our BUY recommendation with a price target of Rs2,350. Financial summary Y/e 31 Mar (Rs m) FY13 FY14E FY15E FY16E Revenues 237, , , ,497 yoy growth (%) Operating profit 32,845 36,042 41,435 48,818 OPM (%) Reported PAT 21,182 20,766 29,728 37,152 yoy growth (%) (10.9) (2.0) EPS (Rs) P/E (x) Price/Book (x) EV/EBITDA (x) RoE (%) RoCE (%) Source: Company, India Infoline Research March 14, 2014 Rating: Sector: Sector view: Automobile Neutral Sensex: 21, Week h/l (Rs): 2,214 / 1,434 Market cap (Rscr) : 41,946 6m Avg vol ( 000Nos): 369 Bloomberg code: HMCL IB BSE code: NSE code: HEROMOTOCO FV (Rs): 2 Price as on March 13, 2014 Company rating grid Earnings Growth Cash Flow B/S Strength Valuation appeal Risk Low Share price trend Tata Mot High Sensex 70 Feb 13 Jun 13 Oct 13 Jan 14 Share holding pattern Promoter Institutions Others 100% 80% 60% 40% 20% 0% BUY Target (9 12 months): Rs2,350 CMP: Rs2,100 Upside: 11.9% Mar 13 Jun 13 Sep 13 Dec 13 Research Analyst: Prayesh Jain research@indiainfoline.com Company Report

2 Rural and scooters driving 2-w out performance Over the past couple of years total domestic vehicle sales in India grew by modest rates of 2.6% and 2.5% respectively. Excluding two wheelers the volumes were lower by 9.3% in YTD FY14 and a muted growth of 1.7% in FY13. The out performance of two wheelers was driven by scooters in terms of products and rural India in terms of market. For seven consecutive years demand growth for scooters in India has outpaced the total demand growth for two wheelers in the domestic market by a substantial margin. The growth has been on account of 1) increase of working women in overall population and 2) improved technology and styling of scooters attracting youth population. Rural India has seen much better sentiment compared to the urban India owing to 1) higher MSPs for agricultural produce, 2) above normal monsoons leading to better productivity, 3) better finance availability and 4) pro rural development schemes of the government. The out performance of two wheelers was driven by scooters in terms of products and rural India in terms of market. Seven consecutive years demand growth for scooters in India has outpaced the total demand growth for two wheelers in the domestic market by a substantial margin Rural India has seen much better consumer sentiment as compared to the urban India Growth in scooters demand to outperform 2 W industry Contribution of scooters to total two wheeler domestic sales has increased from 12% in FY07 to 24% in YTD FY14. We believe the contribution is set to increase further to 28 30% over the next three years. This would be driven by: With increasing crimes against women happening in public transport, working women prefer a personal mode of transport. Scooter is the best option given its comfort of driving and reasonable ownership costs. As compared to past, the new branding and styling of scooters have encouraged the male population and the younger generation towards scooters. Earlier the preference was a motorcycle. Rising urbanization trend in the country will spur up demand as an efficient public mode of transport takes time to be built in a new city and people will opt for a personal mode of transport. Increased preference of scooter for personal mobility by women New models appeal to male population as well as the youth Increasing urbanization will translate into higher demand for personal vehicles Scooters have seen rapid increase in demand over the past six years 3,500,000 3,000,000 Scooters (LHS) yoy growth (RHS) 50% 40% leading to doubling of the segment s contribution to total two wheeler industry volumes 25% 20% 2,500,000 2,000,000 30% 20% 15% 1,500,000 10% 10% 1,000, ,000 0% 10% 5% 0 20% 0% FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Source: SIAM, India Infoline Research Source: SIAM, India Infoline Research 2

3 Growth in rural demand to sustain While the urban sentiment for auto demand over the past three years has been weak on the back of macro headwinds in the form of rising interest rates, poor income growth and high inflation rates, the rural India has seen strong consumer sentiment driven by higher disposable income growth and many other factors enlisted below. Growing MSPs: To push up the agricultural productivity, government of India has raised minimum support prices across key products on a sustained basis. For FY14 Kharif season, the government raised prices by about 7 8%. Steady increase in MSPs has improved incomes for farmers Sustained increase in MSP 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Rs/quintal Paddy Jowar Bajra Soyabean Tur Cotton FY10 FY11 FY12 FY13 FY14 Source: Media articles Rural infrastructure development: Steady investments towards developing infrastructure have reaped results in the form of improved road connectivity. With poor public transport system existing in these areas, personal mode of transport is an essential and motorcycles are the most reasonable form. Better road connectivity has translated into higher demand for personal transport vehicles Improved road connectivity in rural areas 60% 50% 40% 30% 20% 10% % habitations unconnected as on 1 April 2000 % habitations unconnected as on 22 August % Less than 250 Total Source: PMGSY Website 3

4 Employment schemes supporting labour wages: Through its flagship program NREGA (National rural employment guarantee act) the government has provided 100 days guarantee to 131mn households across 778,134 villages. Per day wages under the act have more than doubled from Rs82/day in FY10 to Rs174/day in FY14. This has ensured a sustained income in the non farming season for rural population. Per day wages under the act have more than doubled from Rs82/day in FY10 to Rs174/day in FY14. This has ensured a sustained income in the nonfarming season for rural population Surge in per day wage rate under the NREGA Act Rs/day FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Source: Government of India Crop loan waivers and interest subvention: One of the biggest drivers for sustained strong consumer sentiment in the rural areas has been steady increase in credit availability. Furthermore, time and again the government has provided relief to rural borrowers in the form of interest subvention and farm loan waivers. Better credit availability and occasional waivers and subventions have increased fund availability for rural India Steady increase in credit availability to the agriculture sector 7,000 6,000 Rs bn 5,000 4,000 3,000 2,000 1,000 0 Apr 07 Aug 07 Dec 07 Apr 08 Aug 08 Dec 08 Apr 09 Aug 09 Dec 09 Apr 10 Aug 10 Dec 10 Apr 11 Aug 11 Dec 11 Apr 12 Aug 12 Dec 12 Apr 13 Aug 13 Dec 13 Source: RBI, India Infoline Research The aforementioned factors are here to stay and will continue to buoy demand for motorcycles from the rural India. As per Crisil estimates, rural demand will account for 60% of the incremental demand for motorcycles in as compared to 46% estimated for

5 well placed at both drivers... Strong market share gains in the scooter segment Contribution of scooters to the overall two wheeler sales have increased from 12% to 24 in the past seven years. In the initial phase the majority of the market was captured by Honda through its model Activa. However, in the past three years other players have ventured with new models garnering market share. has been in forefront with its Pleasure and Mastero models. It has seen it's market share in scooters grow from 2% in FY06 to 20% in the FY14 YTD. has been in forefront with its Pleasure and Mastero models. It has seen it's market share in scooters grow from 2% in FY06 to 20% in the FY14 YTD Increasing market share in scooters 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Source: SIAM, India Infoline Research Widest presence in rural India has been a dominant player in the rural area. That has been it's strength with presence through sale and service outlets in villages. With a legacy record, understands the needs of the rural customers and on various occasions has taken several initiatives to fortify its already strong relationship with rural customers. These include organizing free vehicle servicing and medical camps in over 100,000 villages around the country. Apart from having the widest reach has strengthened its brand in rural India through initiatives such as free vehicle servicing and medical check ups Widest presence in domestic markets 7,000 6,000 5,000 4,000 3,000 2,000 1,000 Dealers Touch points 0 Hero Bajaj HMSI TVS Yamaha Suzuki M&M Source: Crisil, India Infoline Research 5

6 Market share loss in motorcycles not material Emergence of Honda as a major player in the motorcycle market was a key concern to the incumbent leaders like Bajaj Auto and. While Honda has gained 8% market share from FY11 to FY14 in the motorcycle market it has been more at the behest of Bajaj Auto. Bajaj Auto has lost 6.5% market share in the same period while has lost just 2.6% market share. We believe s strong presence in rural India along with leadership position in <100cc motorcycle has been the key cushions. It's flagship brands like Splendor and Passion continue to be the top performing in the sector. This we believe will continue to be driving force for in near term. Market share gains for HMSI in motorcycle segment has been more at the behest of Bajaj Auto than Hero Motocorp Change in domestic motorcycle market share between FY11 and YTD FY % 8.0% 8.0% 6.0% 4.0% 2.0% 2.6% 0.0% 2.0% 4.0% 2.6% 1.5% 6.0% 8.0% 6.5% Bajaj Auto Hero Honda TVS HMSI Others Source: SIAM, India Infoline Research Robust line up of model launches Automobile demand for personal commuting in India has seen a marked trend in the recent past where new models attain a lot of attraction and provide strong momentum to overall volumes even in a weak market. enjoys a significant brand loyalty which has been evident from limited market share loss in spite of a weak motorcycle market and rising competition. With its R&D initiatives through its technological tie ups the company will be launching a series of new models in newer segments. These were showcased in the recently concluded auto expo, details of few are enumerated below. With its R&D initiatives through its technological tie ups the company will be launching a series of new models in newer segments Over the next few years a customer will have wide variety to choose from and will help the company cater to demand of niche segments as well. While this will shore up R&D costs and marketing spends, we believe successful launch will result in benefits of operating leverage. 6

7 New model launches Hero Xtreme The first of these models to go on sale will be the Hero Xtreme motorcycle, slated for a launch around April The bike is based on the existing CBZ Xtreme but styling is quite different and far edgier than the original. Among the features of interest are the Xtreme's headlight, indicators, LED tail lamps, part digital speedometer with side stand indicator, and new graphics. The Xtreme will continue to use the Honda sourced four stroke, 149.2cc, singlecylinder and air cooled engine as seen on the CBZ Xtreme. Peak power output of 15.2bhp at 8500rpm, with 1.30kgm of torque at 6500rpm will be transferred to the rear wheel through a drive chain with the help of a five speed gearbox. The Xtreme would be available with a 240mm front disc brake as standard and a 220mm rear disc brake as an option to the 130mm drum brake. The Xtreme would come in five colour options black, red, silver, black red and orange. Hero Leap Towards the end of the year, Hero MotoCorp will introduce its first hybrid scooter, the Leap. True to its name, the scooter will mark a giant leap for Hero Motocorp thanks to its technology. Leap will be a serial hybrid that uses a pack of lithium ion batteries to power its 8kW (approximately 10.7bhp) electric motor along with a Permanent Magnet AC (PMAC) traction motor that churns out approximately 6.11kgm of maximum torque from standstill. What makes the Leap unique in India is that it uses range extender technology. That means, when the batteries run out of juice, the electric motor will draw charge from a generator linked to the Leap s 124cc petrol engine. Note, the petrol motor will not be connected directly to the rear wheel but will be used solely to run the on board generator. The Leap is endowed with alloy wheels, a 110/70 x 13 inch tyre with 240 mm two piston calliper Brembo disc brake up front and a 120/70 x 11 inch tyre with 130mm drum brake at the rear. has not made any claims for fuel efficiency as yet but, given the tech, you can be assured the Leap will stretch each litre really, really far. However, the Leap is unlikely to be priced at par with its petrol engined contemporaries, so think of it more as a technological showcase for than a mass market scooter. Hero Xtreme Hero Leap Source: Autocar India Source: Autocar India 7

8 Hero Dash Around the same time, will also introduce its new scooter called the Dash. The Dash will be powered by a new four stroke, 111cc, forced air cooled, single cylinder motor that produces 8.45bhp of power at 7500rpm and 0.95kgm of torque at 5750rpm. It gets telescopic front forks with a rear monoshock, bolted on to alloy wheels with 90/90 x 12 inch (front) tubeless tyres and 90/90 x 10 inch (Rear) tubeless tyres. The Dash gets 130mm drum brakes on both ends with combined braking system for efficient braking. Key with e code, tail mounted fuel lid, analogue digital cluster, side stand indicator, service due indicator, USB mobile charger, boot light, LED tail light and dual tone mirrors are some of the highlights on the smart and featurepacked new scooter. Hero HX250R s fourth new launch of the year will be the HX250R sports bike. While its twin headlights may have a hint of Honda to them, the bike has been fully designed featuring the trademark lightning bolt design. The fully faired sports bike looks the part and should stand out with its sleek under seat exhaust. Its four stroke, 249cc, liquid cooled, single cylinder, and fuel injected DOHC engine comes with a six speed gearbox. The HX250R uses a tubular frame that is shared with the Honda CBR250R and comes with telescopic suspension at the front and a monoshock rear suspension. Braking on the HX250R is taken care of by a three piston caliper, 300mm disc brake up front and a 220mm rear disc brake, available as standard equipment with Combined Braking System, and ABS available as option. The ten spoke alloys with a 110/80 x 17 inch tubeless tyre up front and 140/70 x 17 inch tubeless tyre at the rear enhance the overall appeal of this motorcycle. The HX250R will not replace but will sell alongside the Karizma R and ZMR, that are also due for updates soon. Hero Dash Hero HX250R Source: Autocar India Source: Autocar India 8

9 Hero RNT also took the wraps off a unique motorcycle concept at the event. Called the RNT, the bike is designed for use on farms as a load lugger, which helps explain its curious design. But the RNT is even more interesting under the skin. It comes with a four stroke, 150cc, liquid cooled, diesel engine. will offer a turbocharged version too! Peak power is around 13.5bhp at 4000rpm with 3.56kgm of torque at 1600rpm, which is transferred to the rear wheel by a six speed gearbox. Some unique features of the RNT are the wide, flat loading surfaces with strap bars, as well as multi use folding front, rear and side racks, a large seat, spacious footboard and removable secondary LED headlight with internal Li ion battery along with an LED headlight that would provide good visibility even with the front rack loaded. is also working on powering the RNT with an electric motor that produces 1.3bhp of power, mounted in the front wheel hub. Depending on the need, the RNT could be used in diesel mode, as a full electric or with both motors working simultaneously, powering each of the wheels. Yes, that s two wheel drive. Although is confident that such a product will have huge potential in India, the timeline for its launch is still not clear. Hero RNT Source: Media reports 9

10 gearing to tap large export opportunity Under the JV with the Honda group, was restricted to exports to markets where Honda had an erstwhile presence. The split up has now enabled the company to enter newer markets. In the initial stages the company has entered 8 markets and has plans to enter other markets in Middle East and Africa. So far the key companies present in these markets have <100cc motorcycle as their key product. With having leadership position in that segment in domestic markets, it is well poised to make inroads and garner market share. With the technological tie ups the company has made in the recent past its building a robust line up of products enabling them to enter developed markets. considering the margins the market leader is making we believe higher export volumes will also drive earnings for. is planning to enter 20 new markets and also set up assembly operations in four countries. Currently Hero MotoCorp sells products in Nepal, Guatemala, Honduras, El Salvador, Peru and Kenya. By March end, Hero Motocorp will increase its presence in 20 countries and will enter new markets like Ethiopia, Turkey and Nicaragua in Central America. The company has already started selling vehicles to other new markets such as Tanzania, Uganda, Burundi, Egypt, Ecuador and Bangladesh. will set up local assembly operations in Tanzania and Uganda and had started assembly operations at Nairobi in Kenya in The company is also planning to set up JV for a manufacturing plant in Colombia to cater to other Latin American markets. In July, the company announced foray into the African continent with the launch of its brand and products in Kenya, followed by Burkina Faso and Ivory Coast. In August, it announced plans to enter 50 new markets by 2020 with a target of 20 manufacturing facilities across the globe. is targeting 10% of its annual sales to come from export markets, at around one million units by Hero MotoCorp has set an ambitious target of cumulative sales of 100 million units by 2020, having crossed the 50 million milestone last year. With having leadership position in <100cc segment in domestic markets, it is well poised to make inroads and garner market share in international markets like Africa and Asia is planning to enter 20 new markets and also set up assembly operations in four countries is targeting 10% of its annual sales to come from export markets, at around one million units by

11 Cost cutting measures to drive margins has embarked on a cost cutting program through measures such as vendor rationalisation etc. The company started the process six months back and saw a 50bps positive impact on margins in q3. Currently only few models have been brought under the fold. With all models going through the flab cutting exercise over the next months company expects 300bps positive impact on margins. While how much of it would be retained and how much would be passed on to customer in the form of lower prices on existing models or better features at same price would depend on industry trend. We believe any of these steps would be profit accretive. With all models going through the flab cutting exercise over the next months company expects 300bps positive impact on margins OPM expansion % FY11 FY12 FY13 FY14E FY15E FY16E Source: Company, India Infoline Research Royalty payment to be miniscule The JV termination agreement with Honda required to pay 45bn Yen as royalty to Honda group. provided for the same at the time of split and has been amortizing Rs2bn every quarter (depending on yen rupee rate). With the payments getting completed in Q1 FY15 Hero Motocorp will be left to pay royalty on only four products which Honda group supplied post split up. This will translate into robust expansion in net profit margins for the company. With the payments getting completed in Q1 FY15 will be left to pay royalty on only four products which Honda group supplied post split up Strong earnings CAGR While domestic volumes for will grow in line with the industry 8 10% CAGR in the next couple of years, exports are likely to see a substantial jump. Realizations will see a modest rise of 2% on back of increasing proportion of scooters and premium motorcycles. With OPM expected to expand by 200bps over the next couple of years along with sharp decline in royalty, earnings growth is expected to be at 30% during FY14E 16E. 11

12 Valuations attractive Given the earnings CAGR of 30.9%, valuations are attractive at P/E of 11.7x FY16E EPS of Rs The stock is trading at a discount to Bajaj Auto for which are expecting a earnings CAGR of 12.3% during the same period. Bajaj Auto is trading at P/E of 13x FY16E EPS of Rs We believe that should trade at least at par with Bajaj Auto if not at a premium. We maintain our BUY recommendation with a price target of Rs2, year forward P/E band Price 7x 10x 13x 16x 19x 22x 3,500 3,000 Rs 2,500 2,000 1,500 1, Mar 09 Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 Mar 14 Source: Company, India Infoline Research 12

13 Financials Income statement Y/e 31 Mar (Rs m) FY13 FY14E FY15E FY16E Revenue 237, , , ,497 Operating profit 32,845 36,042 41,435 48,818 Depreciation (11,418) (11,816) (5,439) (3,703) Interest expense (119) (119) (119) (119) Other income 3,984 4,339 4,847 5,897 Profit before tax 25,292 28,446 40,724 50,893 Taxes (4,110) (7,680) (10,995) (13,741) Net profit 21,182 20,766 29,728 37,152 Balance sheet Y/e 31 Mar (Rs m) FY13 FY14E FY15E FY16E Equity capital Reserves 49,663 56,625 72,551 95,899 Net worth 50,062 57,025 72,950 96,299 Debt Def Payment Credit 2, Def tax liab (net) 1,324 1,424 1,524 1,624 Total liabilities 54,408 58,659 74,684 98,133 Fixed assets 31,331 29,483 31,544 35,371 Investments 36,238 54,238 69,238 84,238 Net working capital (14,971) (33,579) (38,573) (45,654) Inventories 6,368 6,888 7,701 8,816 Sundry debtors 6,650 7,194 8,043 9,207 Other curr assets 14,020 14,686 15,386 16,122 Sundry creditors (27,610) (46,772) (52,290) (59,864) Other curr liabilities (14,399) (15,576) (17,414) (19,936) Cash 1,810 8,516 12,475 24,177 Total assets 54,408 58,659 74,684 98,133 Cash flow statement Y/e 31 Mar (Rs m) FY13 FY14E FY15E FY16E Profit before tax 25,292 28,446 40,724 50,893 Depreciation 11,418 11,816 5,439 3,703 Tax paid (4,110) (7,680) (10,995) (13,741) Working capital (18,537) 18,608 4,994 7,081 Operating cashflow 14,062 51,190 40,162 47,936 Capital expenditure (4,505) (9,969) (7,500) (7,530) Free cash flow 9,557 41,221 32,662 40,406 Equity raised 0 Investments 3,404 (18,000) (15,000) (15,000) Debt financing/ disposal 44 Dividends paid (14,018) (13,803) (13,803) (13,803) Other items (759) Net in cash (1,770) 9,518 3,958 11,702 Key ratios Y/e 31 Mar FY13 FY14E FY15E FY16E Growth matrix (%) Revenue growth Op profit growth (9.2) EBIT growth (12.0) Net profit growth (10.9) (2.0) Profitability ratios (%) OPM EBIT margin Net profit margin RoCE RoNW RoA Per share ratios EPS Dividend per share Cash EPS Book value per share Valuation ratios P/E P/CEPS P/B EV/EBIDTA Payout (%) Dividend payout Tax payout Liquidity ratios Debtor days Inventory days Creditor days Leverage ratios Net debt / equity (0.0) (0.1) (0.2) (0.2) Net debt / op. profit (0.0) (0.2) (0.3) (0.5) Du Pont Analysis Y/e 31 Mar (Rs m) FY13 FY14E FY15E FY16E Tax burden (x) Interest burden (x) EBIT margin (x) Asset turnover (x) Financial leverage (x) RoE (%)

14 Recommendation parameters for fundamental reports: Buy Absolute return of over +10% Market Performer Absolute return between 10% to +10% Sell Absolute return below 10% Call Failure In case of a Buy report, if the stock falls 20% below the recommended price on a closing basis, unless otherwise specified by the analyst; or, in case of a Sell report, if the stock rises 20% above the recommended price on a closing basis, unless otherwise specified by the analyst Published in India Infoline Ltd 2014 This report is for the personal information of the authorised recipient and is not for public distribution and should not be reproduced or redistributed without prior permission. The information provided in the document is from publicly available data and other sources, which we believe, are reliable. Efforts are made to try and ensure accuracy of data however, India Infoline and/or any of its affiliates and/or employees shall not be liable for loss or damage that may arise from use of this document. India Infoline and/or any of its affiliates and/or employees may or may not hold positions in any of the securities mentioned in the document. The report also includes analysis and views expressed by our research team. The report is purely for information purposes and does not construe to be investment recommendation/advice or an offer or solicitation of an offer to buy/sell any securities. The opinions expressed are our current opinions as of the date appearing in the material and may be subject to change from time to time without notice. Investors should not solely rely on the information contained in this document and must make investment decisions based on their own investment objectives, risk profile and financial position. The recipients of this material should take their own professional advice before acting on this information. India Infoline and/or its affiliate companies may deal in the securities mentioned herein as a broker or for any other transaction as a Market Maker, Investment Advisor, etc. to the issuer company or its connected persons. This report is published by IIFL India Private Clients research desk. IIFL has other business units with independent research teams separated by 'Chinese walls' catering to different sets of customers having varying objectives, risk profiles, investment horizon, etc and therefore, may at times have, different and contrary views on stocks, sectors and markets. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to local law, regulation or which would subject IIFL and affiliates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. IIFL, IIFL Centre, Kamala City, Senapati Bapat Marg, Lower Parel (W), Mumbai For Research related queries, write to: Amar Ambani, Head of Research at amar@indiainfoline.com or research@indiainfoline.com For Sales and Account related information, write to customer care: info@5pmail.com or call on