Equirus Earnings Preview 4QFY18...4QFY18 Earnings Preview April 9, 2018 Page 2 of 54 IT Services...

April 9, 2018 “Before reading this report, you must refer to the disclaimer on the last page” of 54

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4QFY18 Earnings Preview

Auto Parts

Volumes across the segments are robust and posted the yoy growth on the back of

low base of 4QFY17 post demonetization and rural demand.

Atul Auto is expected to post the strong revenue growth over the lower base. Bajaj is

also expected to post the strong growth driven by 3W segment, due to the opening

up of permits in various parts.

Increasing RM costs will put some pressure on the margins however, better

realizations and operating leverage benefits will lead to margin expansion.

Fiem and Lumax the automotive lighting play is expected to the increasing adaption

of LEDs for aesthetic and efficiency reasons.

Construction

In FY18, NHAI awarded 150 road projects covering 7,400 km worth Rs.1.22tn and

completed construction of 3,070 km. In last 5 years, the average length of road

projects awarded by NHAI was 2,860 km with 4,335 Km awarded in the last financial

year. We expect the ordering activity to remain strong for next year, particularly

for 1H19 as well as NHAI continues to focus on awarding of Bharatmala projects.

Order books of all the construction companies are at all-time high and most of them

currently have revenue visibility between 4-4.5x (OB/TTM revenues). Toll collections

across various BOT projects are also seeing gradual improvement. We expect a

healthy growth in execution to continue in FY19 as well. While the overall

environment remains favorable, we would remain cautious on companies with a

continuous surge in EPC business net debt and high levels of core working capital.

Consumer Goods

Given the favorable base in case of many consumer companies this quarter is likely

to remain stable on a qoq basis with margins also remaining stable. Price hikes are

likely to come in across various products given the higher prices of crude and certain

products where price hikes werent implemented post GST implementation.

We expect decent volume growth during the quarter in the home appliances space

esspecially for companies in the cooling product categories. The sales for the cooling

product companies have been delayed by around 20-25 days due to delay in the

onset of summer. In the discretionary space we expect strong set of operational

performance from Jubilant FoodWorks on the back of favorable base and sustainable

initiatives by the company.

Financial Services

While Yields had been hardening for most part of the quarter, various event in the

second half of March like i) lower than expected Govt. borrowings calendar in

1HFY19, ii) RBI relaxing norms for provisioning on NCLT norms as well as for MTM on

investments has led to much needed softening of the yield. This would result in SOE

as well as select banks Pvt. bank getting relief for provisions for 4QFY18. However,

overall cost of borrowings for NBFCs has inched up during the quarter with CANF

increasing rates on home loans

Systemic loan growth remained in low double digits during 4QFY18 with private

sector banks garnering significant share of incremental growth.

SOE banks received the first phase of capital infusion in the fag end of the quarter

which will likely aid Tier 1 capital. However, this is unlikely to result in credit uptick

for SOE banks

Within our coverage large Pvt. Banks are likely to report NII growth of ~13% yoy

(dragged by ICICIBC at flat yoy) and regional banks at 12% yoy (dragged by KVB -1%

yoy). Provisioning likely to remain elevated for ICICIBC, KVB, SIB.

We expect healthy loan book growth for the large private sector banks under our

coverage led by Yes bank at ~35%, IndusInd bank at ~25%, HDFC bank at ~20% and

ICICI bank at ~15%. Loan growth for south based regional banks is likely to be in mid-

teens.

Within our coverage we expect CUBK, HDFCB, IIB, YES, CANF, Equitas, LTFH, Ujjivan

and AUSFB to report PAT above 20%.


April 9, 2018 of 54

IT Services

4QFY18 US$ revenue growth within our tier-I coverage universe could range 1.5%-

2.7% qoq with cross currency tailwinds of ~100bps driven by 4.5%, 4.1%, & 2.1%

appreciation in the GBP, EUR and AUD vs. the USD. HCLT (2.7%) could lead driven by

IP contribution, followed by TCS (2.4%), TechM (2.1%), Wipro (2%) and Infosys (1.5%).

EBITM could be flat to 63bps qoq improvement primarily driven by operational

efficiency. That said, all eyes would be on Infosys guidance as consensus appears

aggressive. Our recent checks suggest that guidance process is being centralised and

generally this implies conservativism. We believe, Infosys could start the year with

CC growth guidance of 5.5-7.5%

Within our midcap universe, Cyient’s US$ revenues could increase 7.5% qoq (82% qoq

growth in DLM business due to right shifting of order) while Persistent revenues could

decline 3.3% led by decline in IP revenues. Generally, growth across midcap would

be led by recovery in top client portfolio and deals wins. EBITM generally would be

aided by operational efficiency, and cross currency tailwinds partially offset by

company specific headwinds.

CY18E IT budget spend patterns, demand trends in BFSI, retail verticals &

discretionary projects, continue to be investor interest.

Media & Telecom

Media agencies suggest that the overall advertising environment remained subdued

in the months of January and February and some meaningful pick up in advertising is

expected in FY19. However, given the lower base of last year, we estimate mid-

single digit advertising growth for print companies and low double digit growth for

the radio companies.

Overall, FY19 is expected to be good for media companies helped by upcoming state

elections and soft comps of last year. Newsprint costs will be the key thing to watch

out for as it may put pressure on margins of print companies. Jagran Prakashan is our

preferred pick in media given its superior Radio business and digital strategy.

Metals and Mining

Hindustan Zinc is expected to post the numbers lower than the last year as last year

the production was skewed towards the second half.

GMDC is also expected to post 40% yoy EBITDA growth driven by 27% yoy volume

growth driven by operating leverage benefits.

Coal India is likely to post strong 98% growth in EBITDA driven by reduction in the

Employee cost and operating leverage benefits

Ratnamani sales is expected to grow by 42% driven by a strong growth of 97% yoy in

the CS volumes.

Oil & Gas

Volume for transmission companies to remain steady. IGL will continue to report

strong volume while GGAS will see volume growth post demand pickup from

industrial customers. GRM to decline marginally. Petchem spread is expand post rise

in petchem prices. PLNG will report flat volume as Higher LNG price impacted some

demand from power and industrials.

Pharmaceuticals

4Q would continue to see ongoing fundamental issues in Pharma space; 1) Dearth of

high value launches, 2) High price erosion in base portfolio led by higher competition

and channel consolidation 3) Gradual recovery in Dometic channel inventory.

Nevertheless Domestic market would see a rebound with channel inventory levels

enhancing following GST led disruption and lower base last year. It would be a good

quarter for Natco, Cadila, Cipla who would get benefitted by strong contribution

from gTamiflu- led by strong flu season.

Power Generation & Transmission

India has a total installed capacity of 334GW as of Feb'18 vs. 315GW as of Feb'17.

Renewables capacities as on Dec'17 stood at 60GW which have improved sharply in

past two years led by addition in Solar and Wind capacities. Going ahead, revival in

capex, demand pick up and long term bids will be the key factors to watch out for.

Orders have improved on transmission and railways electrification front and we

expect fruther pick up going ahead pushed by schemes like UDAY, DDUGJY, IPDS,

Housing for All, and Saubhagya etc. Overall, we expect the capital utilization and

asset sweating to improve going ahead with Government's policies push in the power

sector. We continue to believe in strong balance sheets with efficient assets.


April 9, 2018 of 54

Exhibit 1: Equirus Coverage Universe valuation table for Regular and Lite coverage (*) =Calendar Year (CY17=FY18) ;( L) =Lite Coverage

Company Rating

Entry

Price

(Rs.)

CMP

(Rs.)

Target

Price

(Rs.)

Upside

(%)

Mkt Cap

(Rs. Bn)

EPS (Rs) (Year-FY) Cons.

EPS ROE (Year-FY)

P/E

(Year-FY) P/BV

Div.

Yield

Div. Per

Share

Last Est.

Date

2017 2018E 2019E 2018E 2017 2018E 2019E 2018E 2017 2018E 2018E 2018E

Auto and Auto Parts

AMARA RAJA BATTERIES Add 849 803 918 14 137 27.9 29.2 35.3 28.6 20% 18% 19% 27.5 5.3 4.6 1% 4.3 12-Feb-18

APOLLO TYRES Long 248 293 283 -3 168 19.2 12.1 18.9 13.3 12% 12% 11% 24.3 2.0 1.8 1% 3.0 6-Feb-18

ATUL AUTO Add 420 440 479 9 10 16.5 21.3 23.9 21.2 22% 24% 23% 20.7 5.5 4.7 1% 5.9 14-Feb-18

BAJAJ AUTO Reduce 3190 2772 3137 13 802 141.0 145.0 165.0 146.8 26% 22% 23% 19.1 4.5 4.0 2% 55.0 5-Feb-18

BALKRISHNA INDUSTRIES Add 1160 1288 1256 -2 249 37.1 39.9 50.5 40.5 23% 20% 21% 32.3 3.5 6.0 0% 6.0 15-Feb-18

EICHER MOTORS Add 29678 29806 32153 8 812 614.3 789.7 978.9 803.7 37% 35% 33% 37.7 15.1 11.5 1% 150.0 5-Apr-18

EXIDE INDUSTRIES Long 212 238 248 4 203 9.5 11.5 12.9 8.4 17% 18% 18% 20.8 4.0 3.5 1% 2.4 4-Feb-18

FIEM INDUSTRIES Long 921 936 1350 44 12 36.0 37.7 51.9 37.3 14% 12% 15% 24.8 2.9 0.7 1% 8.0 14-Feb-18

HERO MOTOCORP Reduce 3542 3799 3615 -5 759 169.1 180.9 190.3 185.6 36% 33% 31% 21.0 7.5 6.5 2% 90.0 6-Feb-18

LUMAX INDUSTRIES Long 1750 2246 2464 20 21 59.1 77.1 94.8 80.6 19% 21% 23% 29.1 11.2 9.9 1% 16.5 5-Feb-18

MINDA INDUSTRIES Add 1182 1126 1240 10 98 19.4 29.4 36.5 26.0 22% 22% 23% 38.4 9.5 7.9 0% 2.5 14-Feb-18

Maruti Suzuki Add 9298 9293 9772 5 2807 247.8 256.1 315.2 271.4 22% 19% 21% 36.3 7.6 6.6 1% 80.0 25-Jan-18

Building Materials

ASIAN PAINTS Reduce 1176 1157 1155 0 1110 20.5 21.3 25.7 21.9 28% 25% 27% 54.3 14.6 13.1 0% 5.6 23-Jan-18

ASTRAL POLY Short 782 929 650 -30 111 12.3 13.6 18.6 15.0 19% 18% 20% 68.3 13.1 11.1 0% 0.8 14-Feb-18

BERGER PAINTS Add 249 267 263 -2 260 4.4 4.9 6.1 4.9 25% 23% 26% 54.8 13.7 12.0 1% 2.0 13-Feb-18

CENTURY PLY Long 297 357 344 -4 79 8.6 8.1 11.8 7.9 31% 23% 27% 43.9 11.1 9.3 0% 1.5 6-Feb-18

CERA Reduce 3225 3329 3269 -2 43 76.3 76.0 100.8 81.3 21% 18% 20% 43.8 8.3 7.2 0% 11.4 5-Feb-18

FINOLEX IND Add 652 658 723 10 82 28.4 22.4 27.6 23.3 18% 12% 14% 29.3 3.6 3.4 2% 11.2 14-Feb-18

GREENPLY Add 337 320 358 12 79 9.7 11.6 13.4 11.3 17% 17% 17% 27.6 5.1 4.3 0% 0.7 7-Feb-18

HSIL Add 434 401 468 17 29 13.9 12.9 18.6 13.2 7% 6% 9% 31.1 2.0 1.9 1% 4.5 31-Jan-18

KAJARIA CERAMICS Reduce 631 563 586 4 90 15.9 14.3 18.5 15.3 24% 19% 22% 39.4 7.6 7.1 1% 6.2 1-Feb-18

POKARNA Long 212 196 266 36 6 22.5 16.1 18.8 17.2 53% 28% 27% 12.1 11.5 3.1 3% 5.0 18-Feb-18

SHANKARA Add 1720 1845 1859 1 42 26.4 34.6 45.5 34.6 18% 18% 21% 53.3 10.7 9.1 0% 4.1 31-Jan-18

SOMANY CERAMICS Add 735 684 789 15 29 22.9 18.9 24.5 18.5 20% 15% 17% 36.3 5.6 5.0 0% 3.4 31-Jan-18

SUPREME IND Short 1254 1218 1104 -9 155 30.5 29.7 34.6 31.3 28% 24% 26% 40.9 10.0 9.5 2% 20.5 30-Jan-18

Chemicals

ATUL Add 2442 2773 2813 1 82 109.0 118.6 145.2 102.6 18% 17% 18% 23.4 4.2 3.6 0% 13.0 7-May-17

SOLAR IND Reduce 1130 1077 1070 -1 97 20.6 24.8 30.6 24.1 22% 22% 23% 43.5 10.5 8.8 0% 4.0 16-Nov-17


April 9, 2018 of 54

Company Rating

Entry

Price

(Rs.)

CMP

(Rs.)

Target

Price

(Rs.)

Upside

(%)

Mkt Cap

(Rs. Bn)


EPS ROE (Year-FY)

P/E

(Year-FY) P/BV

Div.

Yield

Div. Per

Share

Last Est.

Date

2017 2018E 2019E 2018E 2017 2018E 2019E 2018E 2017 2018E 2018E 2018E

Construction

ASHOKA BUILDCON Long 228 262 324 24 49 -0.5 13.7 21.3 2.9 -1% 14% 20% 19.1 2.9 2.6 1% 2.0 31-Jan-18

KNR CONSTRUCTIONS Reduce 322 305 316 4 43 10.7 12.4 15.5 16.8 11% 13% 13% 24.6 1.9 1.7 0% 0.9 15-Feb-18

PNC INFRATECH Add 173 183 164 -10 47 6.1 5.7 6.4 -1.5 15% 12% 15% 32.2 8.4 7.5 0% 0.8 11-Mar-18

SADBHAV ENG. Long 395 401 481 20 69 16.3 18.2 18.2 7.2 14% 14% 14% 22.0 3.4 3.0 1% 4.2 15-Feb-18

SADBHAV INFRA Long 136 136 164 21 48 -7.7 -3.3 -0.4 -6.2 -21% -8% -1% -40.8 3.5 3.1 0% 0.0 5-Feb-18

Consumer Durables

FINOLEX CABLES Add 704 700 801 14 107 26.2 30.5 33.6 5.4 20% 20% 19% 23.0 5.0 4.2 1% 4.0 14-Feb-18

HAVELLS INDIA Reduce 553 534 540 1 334 5.9 7.7 7.4 10.9 21% 24% 19% 69.7 10.2 9.0 1% 4.0 22-Jan-18

JCH Trade 1099 2528 1165 -54 69 38.8 56.7 0.0 38.6 25% 29% 0% 44.6 14.9 11.5 0% 6.0 23-Feb-16

IFB IND Add 1304 1218 1398 15 49 11.9 20.0 36.8 20.0 11% 16% 25% 61.0 12.0 9.2 0% 0.0 8-Feb-18

KEI IND Long 400 430 476 11 34 12.6 17.9 23.7 18.4 23% 26% 27% 24.0 7.1 5.5 0% 0.7 28-Jan-18

SYMPHONY Reduce 1967 1795 1771 -1 126 23.7 29.6 38.9 28.9 43% 39% 38% 60.7 27.4 27.4 0% 7.0 24-Jan-18

V.I.P. INDUSTRIES Add 358 366 392 7 52 5.9 8.4 10.3 8.3 22% 27% 28% 43.5 12.7 10.7 1% 2.5 26-Jan-18

WHIRLPOOL OF INDIA LTD Long 1432 1551 1718 11 197 24.5 27.1 36.5 28.0 23% 21% 24% 57.2 13.3 11.1 0% 3.8 5-Mar-18

Consumer Staples

Apex Frozen Foods Add 643 688 710 3 22 8.0 22.4 27.6 22.5 29% 38% 28% 30.7 17.1 7.8 0% 2.3 20-Mar-18

AVANTI FEEDS Long 2344 2306 2910 26 105 47.1 102.0 104.0 104.9 40% 57% 40% 22.6 16.3 10.6 1% 20.4 22-Feb-18

BAJAJ CORP Add 507 480 546 14 71 14.8 15.3 17.6 15.6 45% 45% 48% 31.4 14.3 13.8 3% 12.0 12-Jan-18

BRITANNIA Add 4764 5163 5106 -1 620 73.7 84.5 103.6 84.2 37% 34% 33% 61.1 23.0 18.7 1% 27.0 14-Feb-18

CCL PRODUCTS Long 276 285 365 28 38 10.1 10.9 14.6 10.9 23% 21% 24% 26.3 6.0 5.1 1% 3.0 3-Feb-18

COLGATE PALMOLIVE Reduce 1100 1095 1114 2 298 21.2 24.8 27.8 24.3 50% 50% 52% 44.1 23.4 20.9 2% 16.5 6-Feb-18

GSK CONSUMER HEALTH Long 5971 6116 6924 13 257 161.3 167.0 193.2 164.6 24% 21% 22% 36.6 8.2 7.5 1% 78.0 13-Feb-18

JUBILANT FOODWORKS Add 2093 2453 2330 -5 162 10.6 29.2 38.8 25.8 9% 22% 23% 84.1 20.1 16.5 0% 2.5 21-Jan-18

JYOTHY LABORATORIES Long 362 380 422 11 69 11.5 9.3 12.1 8.9 21% 15% 19% 40.8 6.3 6.1 2% 6.0 18-Jan-18

MARICO Add 310 328 336 2 424 6.2 6.6 7.6 6.6 37% 35% 36% 49.9 18.2 16.5 1% 3.9 13-Feb-18

P&G HYGIENE Long 8015 9598 8965 -7 69 145.8 156.8 183.1 142.2 45% 69% 53% 61.2 54.3 34.2 0% 45.0 14-Jun-17

Financial Serv.

AU SMALL FINANCE BANK Add 574 677 650 -4 193 18.6 10.8 14.4 10.5 20% 14% 17% 62.5 9.7 8.5 0% 1.0 22-Feb-18

CAN FIN HOMES Reduce 461 452 450 0 60 17.7 23.4 28.1 22.8 24% 26% 25% 19.3 5.6 4.6 1% 2.4 23-Jan-18

CHOLAMANDALAM Long 1379 1538 1570 2 240 46.0 60.2 74.5 59.2 18% 20% 21% 25.5 5.6 4.7 0% 6.5 22-Feb-18

CITY UNION BANK Add 156 175 175 0 116 8.4 9.4 10.8 9.1 15% 15% 16% 18.5 3.3 3.1 0% 0.4 7-Feb-18

DCB BANK Add 184 174 196 13 54 7.0 8.2 9.8 8.1 0% 0% 0% 21.3 2.7 2.2 1% 1.0 19-Jan-18

EQUITAS HOLDINGS Add 151 154 170 11 52 4.7 0.6 5.1 0.9 2% 0% 1% 236.2 2.3 2.3 0% 0.1 1-Feb-18


April 9, 2018 of 54

Company Rating

Entry

Price

(Rs.)

CMP

(Rs.)

Target

Price

(Rs.)

Upside

(%)

Mkt Cap

(Rs. Bn)


EPS ROE (Year-FY)

P/E

(Year-FY) P/BV

Div.

Yield

Div. Per

Share

Last Est.

Date

2017 2018E 2019E 2018E 2017 2018E 2019E 2018E 2017 2018E 2018E 2018E

HDFC BANK Add 1952 1939 2150 11 5032 57.2 68.2 81.9 69.4 18% 18% 19% 28.4 5.9 5.2 1% 14.0 22-Jan-18

ICICI BANK Long 353 281 410 46 1805 16.8 12.8 15.4 12.1 12% 11% 8% 22.0 1.6 1.7 2% 5.0 31-Jan-18

IDFC Long 55 53 69 31 84 4.8 6.0 6.8 4.5 7% 8% 9% 8.8 0.8 0.7 0% 0.0 31-Jan-17

INDUSIND BANK Add 1700 1860 1945 5 1116 48.1 60.6 72.0 60.4 15% 17% 17% 30.7 5.6 4.9 0% 8.0 12-Jan-18

KARUR VYSYA BANK Add 111 103 122 19 75 9.9 6.2 11.2 5.7 13% 7% 13% 16.6 1.6 1.4 3% 2.6 31-Jan-18

L&T FINANCE Add 175 170 195 15 339 5.7 8.0 10.2 7.7 12% 12% 12% 21.3 3.7 3.3 1% 1.4 29-Jan-18

PFC Long 136 90 195 117 237 7.6 26.6 23.0 24.5 5% 18% 13% 3.4 0.6 0.5 12% 10.6 8-Nov-17

REC Long 164 131 230 75 259 31.6 28.7 32.8 26.6 20% 16% 16% 4.6 0.8 0.7 4% 4.8 9-Nov-17

SOUTH INDIAN BANK Long 32 26 38 48 46 2.5 1.8 3.6 1.9 9% 6% 12% 14.4 1.2 1.2 2% 0.4 11-Jan-18

UJJIVAN Reduce 347 380 345 -9 46 17.8 -1.6 19.2 -0.6 3% 0% 2% - 2.6 2.6 0% 0.2 5-Feb-18

YES BANK Long 341 316 405 28 728 15.2 18.4 23.9 18.0 19% 18% 20% 17.2 3.4 3.1 1% 2.8 19-Jan-18

Industrials

AIA ENGINEERING Add 1434 1410 1515 7 133 48.4 42.2 50.5 42.2 18% 14% 15% 33.4 4.9 4.5 1% 10.2 6-Feb-18

ELECON ENGINEERING Add 47 83 54 -35 9 1.0 0.2 5.2 - 2% 0% 8% 350.9 1.3 1.3 0% 0.2 10-Aug-17

GENUS POWER Add 80 54 89 66 14 2.5 2.3 4.4 -6.2 10% 8% 14% 23.1 2.9 2.6 0% 0.2 30-Jan-18

GREAVES COTTON Reduce 127 123 122 -1 30 7.3 6.5 7.7 4.9 20% 17% 19% 19.1 3.3 3.2 4% 5.5 12-Feb-18

POWER MECH PROJECTS Long 904 883 1158 31 13 43.9 59.6 77.2 52.9 11% 13% 15% 14.8 2.1 1.8 0% 1.1 21-Feb-18

TD POWER SYSTEMS Long 217 189 255 35 6 -1.3 -2.6 10.2 -2.4 -1% -2% 7% -73.0 1.3 1.2 0% 0.5 8-Feb-18

TRIVENI TURBINE Add 124 100 134 34 33 3.7 3.1 4.0 2.9 35% 24% 26% 31.8 8.1 7.2 1% 1.0 13-Feb-18

IT Services

Accelya Kale - 983 1351 - -27 20 62.0 74.1 - - 80% 97% - 18.2 17.5 18.0 4% 53.0 -

ECLERX SERVICES Reduce 1531 1246 1325 6 48 89.1 79.4 85.0 73.2 31% 25% 25% 15.7 4.2 3.8 4% 45.0 30-Jan-18

HCL TECHNOLOGIES Add 958 953 1008 6 1327 60.6 62.6 67.2 62.6 28% 24% 22% 15.2 4.0 3.3 1% 8.1 22-Jan-18

HEXAWARE TECH Reduce 356 402 342 -15 119 16.9 18.5 20.8 18.7 27% 26% 25% 21.8 8.5 7.1 2% 9.2 7-Feb-18

INFOSYS Add 1079 1111 1115 0 2427 62.7 69.3 69.1 67.7 22% 22% 20% 16.0 3.7 3.4 3% 28.5 14-Jan-18

CYIENT Add 581 632 608 -4 71 30.6 37.1 40.5 37.1 17% 19% 20% 17.0 3.4 3.2 3% 18.2 19-Jan-18

KPIT TECH Add 218 223 230 3 44 11.3 13.2 15.3 12.3 14% 15% 15% 16.9 2.6 2.3 1% 2.3 30-Jan-18

L&T Technology Services Long 1022 1219 1184 -3 125 41.8 46.3 53.8 46.2 33% 28% 27% 26.4 8.3 6.8 1% 10.3 24-Jan-18

MPHASIS Add 850 897 909 1 173 38.3 42.5 48.8 41.9 13% 13% 14% 21.1 4.2 3.6 3% 22.9 5-Feb-18

NIIT TECH Add 728 883 745 -16 54 44.3 45.4 52.5 44.8 17% 15% 16% 19.4 3.2 2.8 1% 13.0 21-Jan-18

PERSISTENT Add 788 674 816 21 54 37.7 44.0 51.0 41.4 17% 17% 18% 15.3 2.8 2.5 2% 14.0 29-Jan-18


April 9, 2018 of 54

Company Rating

Entry

Price

(Rs.)

CMP

(Rs.)

Target

Price

(Rs.)

Upside

(%)

Mkt Cap

(Rs. Bn)


EPS ROE (Year-FY)

P/E

(Year-FY) P/BV

Div.

Yield

Div. Per

Share

Last Est.

Date

2017 2018E 2019E 2018E 2017 2018E 2019E 2018E 2017 2018E 2018E 2018E

TCS Add 2791 2924 2975 2 5597 137.7 135.1 148.8 133.8 34% 31% 32% 21.6 7.8 6.8 2% 49.8 11-Jan-18

TECH MAHINDRA Add 606 615 629 2 602 29.0 34.9 37.7 38.8 17% 19% 19% 17.6 3.4 3.3 1% 9.0 29-Jan-18

WIPRO Reduce 329 285 310 9 1290 17.4 17.0 19.4 17.9 17% 16% 16% 16.7 2.7 2.6 0% 1.0 22-Jan-18

Metals & Mining

COAL INDIA Add 300 274 332 21 1704 14.9 16.2 22.0 16.9 31% 44% 72% 16.9 6.7 8.4 8% 21.0 11-Feb-18

GMDC Long 148 138 197 43 44 10.2 15.0 14.9 14.5 8% 11% 11% 9.2 1.1 1.0 3% 3.5 10-Feb-18

HINDUSTAN ZINC Long 308 314 361 15 1325 19.7 21.1 26.2 22.7 24% 24% 27% 14.9 4.3 3.6 2% 6.5 18-Jan-18

RATNAMANI METALS Add 937 916 1006 10 43 30.9 32.0 43.8 33.1 13% 12% 15% 28.6 3.7 3.4 1% 7.0 15-Feb-18

Pharmaceuticals

AJANTA PHARMA Add 1493 1381 1658 20 90 57.3 54.6 58.1 54.8 37% 28% 25% 25.3 3.0 3.0 1% 10.9 28-Jan-18

ALEMBIC PHARMA Reduce 567 537 581 8 101 21.4 23.0 25.1 23.0 23% 21% 20% 23.3 5.3 5.3 1% 4.6 31-Jan-18

AUROBINDO PHARMA Long 602 612 773 26 359 39.3 42.6 42.8 43.5 28% 24% 0% 14.4 6.1 5.2 0% 3.0 8-Feb-18

CADILA HEALTHCARE Long 405 391 476 22 400 13.7 15.6 19.8 17.0 23% 21% 23% 25.0 5.8 4.9 1% 3.2 8-Feb-18

CIPLA Long 569 557 662 19 448 12.8 22.0 30.8 20.3 8% 13% 17% 25.3 3.6 3.2 0% 2.6 7-Feb-18

DR. REDDY'S LAB Add 2508 2121 2733 29 352 72.7 57.5 118.0 66.6 10% 7% 14% 36.9 2.8 2.6 0% 9.8 25-Jan-18

GRANULES Long 119 108 172 60 27 7.2 7.0 9.0 6.4 21% 18% 20% 15.4 2.7 2.6 1% 0.8 11-Feb-18

IPCA LAB Add 685 672 750 12 85 15.4 11.9 22.0 18.5 8% 6% 10% 56.3 3.5 3.3 0% 0.0 6-Mar-18

LUPIN Reduce 801 794 791 0 359 56.5 29.5 35.2 32.2 21% 9% 10% 26.9 3.3 2.5 1% 4.4 6-Feb-18

NATCO PHARMA Add 829 780 901 16 144 38.0 35.0 18.7 37.1 19% 19% 19% 22.3 8.2 4.6 1% 7.0 7-Feb-18

SUN PHARMA Add 575 511 620 21 1226 29.0 11.8 22.9 13.4 20% 8% 14% 43.4 3.3 3.2 0% 1.6 15-Feb-18

RPG LIFE SCIENCES Long 501 418 677 62 7 17.8 32.1 47.6 - 20% 29% 34% 13.0 4.3 3.5 2% 7.4 25-Oct-16

TORRENT PHARMA Add 1381 1300 1496 15 220 54.9 40.0 57.3 42.4 24% 15% 19% 32.5 5.1 4.6 1% 10.0 8-Feb-18

Oil & Gas

APAR INDUSTRIES Long 760 764 901 18 29 46.1 40.4 56.3 40.2 19% 14% 18% 18.9 2.8 2.6 2% 12.3 30-Jan-18

GAIL Long 465 331 534 61 746 18.7 30.1 34.5 20.3 8% 12% 13% 11.0 1.4 1.3 4% 12.0 12-Feb-18

GUJARAT GAS Reduce 850 874 872 0 120 15.9 22.7 32.5 26.0 22% 22% 22% 38.5 8.0 6.5 1% 6.0 3-Feb-18

GUJARAT STATE PETRONET Long 188 191 236 24 108 8.8 11.8 12.4 12.1 12% 14% 13% 16.2 2.4 2.1 1% 2.0 20-Mar-18

INDRAPRASTHA GAS Add 292 304 312 3 212 8.3 9.5 11.0 11.3 21% 21% 21% 31.9 7.3 6.2 1% 2.0 7-Feb-18

PETRONET LNG Reduce 248 239 246 3 359 11.4 14.0 15.0 13.9 23% 23% 20% 17.1 4.4 3.5 1% 3.5 8-Feb-18

RELIANCE INDUSTRIES Add 934 916 1015 11 5803 48.6 55.6 57.1 57.7 12% 12% 12% 16.5 2.0 1.8 1% 13.0 21-Jan-18


April 9, 2018 of 54

Company Rating

Entry

Price

(Rs.)

CMP

(Rs.)

Target

Price

(Rs.)

Upside

(%)

Mkt Cap

(Rs. Bn)


EPS ROE (Year-FY)

P/E

(Year-FY) P/BV

Div.

Yield

Div. Per

Share

Last Est.

Date

2017 2018E 2019E 2018E 2017 2018E 2019E 2018E 2017 2018E 2018E 2018E

Power Generation & Distribution

JSW ENERGY Short 85 81 72 -11 132 3.8 3.0 4.5 4.5 6% 5% 6% 26.5 1.3 1.2 1% 1.1 6-Feb-18

KEC International Long 348 409 395 -3 105 12.4 17.1 21.9 16.1 22% 25% 26% 23.9 6.6 5.4 1% 2.3 6-Feb-18

TORRENT POWER Add 274 251 298 19 121 8.1 17.2 17.2 18.9 6% 12% 11% 14.6 1.7 1.6 1% 3.6 7-Nov-17

UJAAS ENERGY Long 43 20 55 175 4 2.0 2.7 4.0 - 19% 22% 26% 7.3 1.8 1.5 1% 0.3 15-Feb-17

Media & Telecom

D.B. CORP Long 356 317 430 36 58 20.2 19.0 22.9 19.1 25% 21% 23% 16.7 3.7 3.4 3% 9.5 18-Jan-18

HINDUSTAN MEDIA VENTURES Long 267 229 330 44 17 25.8 24.4 28.6 8.1 18% 14% 15% 13.0 2.0 1.7 1% 1.2 12-Jan-18

HT MEDIA Add 115 86 123 43 20 7.3 10.9 12.5 11.5 8% 10% 11% 7.9 6.7 4.9 13% 10.9 13-Jan-18

JAGRAN PRAKASHAN Long 173 174 200 15 54 10.6 10.5 12.2 10.4 18% 16% 17% 16.5 2.6 2.3 2% 3.3 31-Jan-18

Music Broadcast Add 393 391 420 7 22 6.4 8.5 12.1 8.9 9% 8% 11% 46.2 4.1 3.7 0% 0.0 25-Jan-18

PRIME FOCUS Long 92 90 123 37 27 1.0 1.3 3.5 2.5 6% 6% 12% 70.9 4.8 4.0 0% 0.0 7-Apr-18

STERLITE TECHNOLOGIES Long 364 331 430 30 133 5.0 7.8 13.0 7.6 25% 32% 41% 42.6 15.0 12.1 1% 1.9 26-Feb-18

Textiles

ARVIND Add 412 408 438 7 105 12.5 15.1 21.3 12.8 11% 11% 14% 27.0 3.0 2.7 1% 2.8 31-Jan-18

KEWAL KIRAN CLOTHING Short 1714 1608 1547 -4 20 69.2 62.9 65.4 66.6 26% 21% 21% 25.6 5.5 5.2 3% 50.9 31-Jul-17

MAYUR UNIQUOTERS Add 500 497 557 12 23 17.1 19.9 23.2 20.0 22% 21% 21% 24.9 6.0 4.9 0% 0.1 14-Feb-18

SP APPARELS LTD Long 351 369 534 45 9 24.6 20.3 29.3 19.6 24% 13% 16% 18.2 3.3 2.9 0% 1.0 18-Feb-18

Others

GUJARAT AMBUJA EXPORTS Long 228 257 330 53 30 13.8 14.3 20.4 14.4 18% 18% 21% 18.1 3.5 3.0 1% 1.7 6-Feb-18

NAVNEET EDUCATION Add 148 147 162 10 34 7.3 7.3 8.1 7.6 27% 23% 23% 20.1 5.0 4.4 2% 3.2 13-Feb-18

NESCO Add 584 563 606 8 40 24.1 25.3 25.9 26.0 22% 20% 19% 22.2 4.7 4.3 2% 13.4 22-Feb-18

PC JEWELLER Add 587 297 639 115 117 10.7 15.1 18.3 15.2 16% 18% 19% 19.7 1.8 3.2 2% 6.4 22-Jan-18

QUESS CORP Add 1057 1060 1150 8 154 7.8 23.6 28.5 21.8 19% 24% 19% 45.0 16.1 7.6 0% 0.0 24-Jan-18

TEAMLEASE SERVICES Long 2082 2237 2442 9 38 32.9 42.2 55.5 44.3 16% 17% 19% 53.0 10.0 8.4 0% 0.0 27-Feb-18


April 9, 2018 of 54

Auto Parts

Outlook

Volumes across the segments are robust and posted the yoy growth on the back of

low base of 4QFY17 post demonetization and rural demand.

Atul Auto is expected to post the strong revenue growth over the lower base. Bajaj

is also expected to post the strong growth driven by 3W segment, due to the opening

up of permits in various parts.

Increasing RM costs will put some pressure on the margins however, better

realizations and operating leverage benefits will lead to margin expansion

Fiem and Lumax the automotive lighting play is expected to the increasing adaption

of LEDs for aesthetic and efficiency reasons

Top pick: Exide, Fiem and Lumax

Tyres

Apollo Tyres 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 38,750 40,501 -4.3% 33,256 16.5% We expect India volumes to grow 18% yoy, realizations are expected to improve 6% yoy.

Standalone EBITDA margin is expected to be about 13%. Consolidated margins are

expected to stay flat.

EBITDA 4,720 4,964 -10.9% 3,699 19.5%

EBIT 3,136 3,450 -17.7% 2,333 21.6%

PAT 2,247 2,279 -10.8% 1,269 60.2%

EPS 3.9 4.8 -26.2% 4.5 -20.7% Key Things to Look For: India & Europe Volume growth, margins

EBITDA Margin 12% 12% -85 bps 11% 29 bps

Balkrishna Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 12,050 11,613 3.8% 10,029 20.1% Volumes are expected to grow 11% yoy, translating into the revenue growth of 20% yoy.

We expect EBITDA/kg at 76.5 vs in 3Q owing to the increase in realisation to Rs 236/kg

vs Rs 217/kg last year which is expected to translate in the margin expansion by

~700bps. RM cost per kg is expected to remain flat.

EBITDA 3,905 3,520 10.9% 2,554 52.9%

EBIT 3,095 2,721 13.8% 1,803 71.7%

PAT 2,196 1,895 15.9% 1,375 59.8%

EPS 11.4 9.8 15.9% 7.1 59.8% Key Things to Look For: Volume growth and margins

EBITDA Margin 32% 30% 209 bps 25% 694 bps


April 9, 2018 of 54

Batteries

Amara Raja Batteries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 15,871 15,535 2.2% 13,445 18.0% We expect 21% & 19% yoy volume growth in 4W & 2W volumes which are in line with

absolute volumes of previous quarter. Telecom segment volumes are expcted to grow

11% yoy. EBITDAM is expected to grow by 192bps yoy and is expected to stay flat qoq.

EBITDA 2,481 2,416 2.7% 1,844 34.6%

EBIT 1,886 1,828 3.2% 1,345 40.3%

PAT 1,418 1,342 5.7% 1,002 41.5%



Exide Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 23,989 22,765 5.4% 19,757 21.4% Exide sales are expected to grow by 21% yoy lead by the overall industry growth.

However margins are expected to stay flat over the last year. The rise in material cost

will nullify the benefit of fall in other expenses

EBITDA 3,104 2,826 9.8% 2,618 18.6%

EBIT 2,475 2,200 12.5% 2,073 19.4%

PAT 1,797 1,585 13.3% 1,665 7.9%


EBITDA Margin 13% 12% 53 bps 13% -31 bps

Minda Industries (Consol) 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 10,624 10,562 0.6% 9,481 12.1% Standalone sales are expected to grow by 17% yoy lead by the overall growth in the 2Ws

and 4Ws. Increasing employee cost is expected to put pressure on the margins and we

expect the margins to fall by ~73 bps/45 bps qoq/yoy.

EBITDA 1,193 1,264 -5.6% 1,108 7.7%

EBIT 710 844 -15.9% 748 -5.0%

PAT 560 567 -1.2% 578 -3.1%

EPS 6.5 6.6 -1.2% 6.7 -3.1% Key Things to Look For: Segment wise sales and margins

EBITDA Margin 11% 12% -74 bps 12% -45 bps


April 9, 2018 of 54

Automotive Lighting

Fiem Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 3,022 2,859 5.7% 2,451 23.3% Sales are expected to grow 23% over the last year due to the increasing adoption of

LEDs. The growth in sales is largely expected to be value driven which is also reflected in

the margins which are expected to grow by ~195bps over last year.

EBITDA 354 358 -1.3% 239 48.1%

EBIT 237 245 -3.4% 137 73.0%

PAT 133 128 4.2% 267 -50.0%

EPS 10.1 9.6 6.0% 9.5 6.9% Key Things to Look For: Segment wise sales and margins


Lumax Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 3,911 3,708 5.5% 3,851 1.6% Lumax sales are expected to rise marginally yoy. However we expect the growth of

~170bps yoy in the EBITDA margins which is translated from the improvement in the

Gross Margins. On the qoq basis we expect the margins to remain flat.

EBITDA 329 329 -0.3% 257 27.7%

EBIT 197 212 -6.8% 156 26.7%

PAT 187 177 5.8% 77 142.6%

EPS 20.0 19.3 3.8% 8.6 133.7% Key Things to Look For: Segment wise sales and margins



April 9, 2018 of 54

Automobiles

Atul Auto 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 1,520 1,290 17.8% 1,041 46.1% We expect the strong revenue growth of about 46% yoy driven by the strong volume

growth of ~34.5% over the lower base of last year. Resulting operating leverage will also

lead to the margin expansion of ~411bps yoy. On the qoq basis the volume growth was

13.5% translating into the sales growth of ~18%.

EBITDA 213 156 36.5% 103 106.8%

EBIT 197 143 38.5% 89 122.7%

PAT 135 97 38.8% 62 117.6%

EPS 6.0 4.3 39.1% 2.8 117.6% Key Things to Look For: Margins and volume outlook


Bajaj Auto 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 66,832 63,693 4.9% 48,973 36.5% Bajaj posted a strong volume growth of ~33% yoy in 4Q largely driven by the 3W volumes

(~145%) in domestic market. We also expect the growth of ~3% in the realization yoy

leading to the revenue growth of ~37% yoy. We expect the margins to remain flat at

19%.

EBITDA 12,698 12,315 3.1% 9,060 40.2%

EBIT 11,910 11,568 3.0% 8,303 43.4%

PAT 10,324 10,448 -1.2% 9,277 11.3%

EPS 35.7 32.9 8.4% 27.7 28.8% Key Things to Look For: Margins and outlook on volumes


Eicher (Consolidated) 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 25,048 22,690 10.4% 18,881 32.7% RE is seeing a good traction in its high value models (Gunmetal Grey and Stealth black).

These models are expected to drive the value growth for the company. Sales volumes for

RE in 4Q grew by 27% yoy resulting in the revenue growth of ~33%. We expect margins to

grow by ~53bps yoy and ~31 bps qoq

EBITDA 7,891 7,072 11.6% 5,848 34.9%

EBIT 7,264 6,423 13.1% 5,416 34.1%

PAT 6,462 5,187 24.6% 4,601 40.4%

EPS 238.4 191.4 24.6% 169.8 40.4% Key Things to Look For: Margins and outlook



April 9, 2018 of 54

Hero Motocorp 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 86,468 73,055 18.4% 69,152 25.0% Total domestic 2W volumes grew by about 23% yoy driven by strong traction in rural

market and the promotional campaigns on the scooters. We expect the margins to go up

by 221 bps yoy owing to the operating leverage.

EBITDA 13,888 10,956 26.8% 9,576 45.0%

EBIT 12,507 10,197 22.7% 8,223 52.1%

PAT 9,807 8,098 21.1% 7,142 37.3%

EPS 49.1 40.3 21.8% 35.9 36.6% Key Things to Look For: EBITDA margins, outlook


MSIL 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 208,341 192,832 8.0% 183,334 13.6%

MSIL posted a strong volume growth of ~11% yoy which is expected to lead to the

revenue growth of 14% yoy. We expect the margins to improve by ~130bps over the last

year due to reduction in other expenses as a result of ramping up of Gujarat plant

EBITDA 31,876 30,378 4.9% 25,607 24.5%

EBIT 24,751 23,488 5.4% 18,597 33.1%

PAT 20,440 17,851 14.5% 18,594 9.9%

EPS 67.7 59.6 13.6% 56.6 19.6% Key Things to Look For: Margins and volume outlook



April 9, 2018 of 54

Building Material

Asian Paints 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 43,749 42,605 2.7% 39,084 11.9%

Volume growth for paint companies is expected to be stable during the qtr while higher

dealer incentives and earnings is likely to bottom out for most of the paint companies

with price hikes expected in FY19. International business profits could be impacted by

currency

EBITDA 8,752 8,912 -1.8% 7,078 23.7%

EBIT 7,806 8,016 -2.6% 6,252 24.9%

PAT 5,576 5,546 0.5% 4,702 18.6%

EPS 5.8 5.8 0.5% 4.9 18.6% Key Things to Look For: Volume growth, gross margin trends


Astral Poly Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 6,913 5,285 30.8% 5,861 17.9% Expect growth in pipe revenue to be 13% back on GST restocking. Margin to increase on

higher profitability in CPVC and very weak base of last year. Adhesive to report 28%

revenue growth.

EBITDA 1,045 737 41.8% 893 17.0%

EBIT 890 595 49.5% 771 15.5%

PAT 559 433 29.1% 531 5.1%

EPS 4.7 3.9 20.6% 4.7 -1.1% Key Things to Look For: CPVC volume growth, Product launch in Resinova


Berger Paints 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 12,865 13,386 -3.9% 11,129 15.6%

Volume growth for paint companies is expected to be stable during the qtr while higher

dealer incentives and earnings is likely to bottom out for most of the paint companies

with price hikes expected in FY19. International business profits could be impacted by

currency

EBITDA 2,017 2,226 -9.4% 1,611 25.2%

EBIT 1,711 1,914 -10.6% 1,336 28.1%

PAT 1,188 1,304 -8.9% 1,055 12.6%

EPS 1.2 1.3 -9.0% 1.1 11.9% Key Things to Look For: Volume growth, gross margin trends



April 9, 2018 of 54

Century Plyboards 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,502 5,099 7.9% 4,885 12.6% Expect revenues to show 13% growth yoy led by commissioning of new MDF plant and see

some growth in plywood and laminates business. EBITDAM might be impacted due to

newly commissioned MDF plant and particle board while PAT looks low yoy as 4Q17 had

higher other income component

EBITDA 885 878 0.9% 838 5.6%

EBIT 637 615 3.7% 683 -6.7%

PAT 428 467 -8.3% 560 -23.6%

EPS 1.9 2.1 -8.3% 2.5 -23.6% Key Things to Look For: GST rate cut impact on unorganized plywood sector, impact on

margins due to recent increase in chemical raw material prices, growth in MDF segment EBITDA Margin 16% 17% -112 bps 17% -107 bps

Cera Sanitaryware 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 3,329 2,909 14.4% 3,112 7.0% We expect company to post 7% growth yoy mainly led by Tiles and Faucetware segement

as Sanitaryware segment will see lower than historical growth for next few quarters due

to slow demand. EBITDAM is expected to be impacted yoy due to higher employee cost

and increased contribution from relatively lower margin Tiles and Faucetware

EBITDA 483 406 18.9% 517 -6.7%

EBIT 423 352 20.2% 459 -7.8%

PAT 283 231 22.7% 323 -12.4%

EPS 21.8 17.7 22.7% 24.9 -12.4% Key Things to Look For: Impact of GST on pricing front, pricing strategy of Morbi players,

demand scenario in real estate and launch of newer projects, on ground reality of

affordable housing push by govt. EBITDA Margin 15% 14% 54 bps 17% -212 bps

Finolex Ind. Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 8,836 7,227 22.3% 8,877 -0.5% PVC Pipe volume to increase by 22% and but decrease in PVC price will led to ~15%

increase in PVC pipe revenue. Continuous normalization of PVC spread to at $175/MT at

EBIT vs $227/MT result into lower profit.

EBITDA 1,661 1,133 46.6% 1,785 -6.9%

EBIT 1,511 980 54.2% 1,646 -8.2%

PAT 1,024 695 47.2% 1,232 -16.9%

EPS 8.3 5.6 47.2% 9.9 -16.9% Key Things to Look For: PVC Spread and PVC Pipe margin. Fitting contribution in PVC

Pipe EBITDA Margin 19% 16% 312 bps 20% -131 bps


April 9, 2018 of 54

Greenply Ind. 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 4,422 3,993 10.7% 4,470 -1.1% Expect flat revenue growth yoy as our channel checks reveal that MDF segment has been

hit on operational front and lower offtake by dealers while Plywood would have seen

growth of 7-8% yoy post GST rate. Margins might be impacted due to lower contribution

from higher margin MDF.

EBITDA 639 627 2.0% 718 -11.0%

EBIT 517 522 -1.0% 597 -13.4%

PAT 341 361 -5.4% 419 -18.5%

EPS 2.8 2.9 -5.4% 3.4 -18.5% Key Things to Look For: Impact of E-way bill on unorganized plywood sector, impact on

margins due to recent increase in chemical raw material prices, update on demerger

plans EBITDA Margin 14% 16% -124 bps 16% -161 bps

HSIL 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,557 5,784 13.4% 5,944 10.3% Expect company to post 10% growth yoy led by traction in consumer product division and

Faucetware while glass division is expected to post flat growth. EBITDAM are expected

to be improving slightly yoy as consumer product division might see lower losses due to

lower A&P and development expenses.

EBITDA 835 725 15.1% 734 13.7%

EBIT 518 436 18.8% 481 7.8%

PAT 283 225 25.5% 308 -8.1%

EPS 3.9 3.1 25.5% 4.3 -8.1% Key Things to Look For: Demand impact post GST, recovery in glass division, volume

growth and price realization EBITDA Margin 13% 13% 19 bps 12% 38 bps

Kajaria Ceramics 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 7,775 6,612 17.6% 7,207 7.9% We expect company to post sales growth of 8% yoy largely led by volume growth as

realisations are likely to remain under pressure. New demand remains subdued from real

estate market due to RERA. EBITDAM might be impacted due to increasing gas costs,

subdued demand, pressure on realizations and higher A&P costs

EBITDA 1,313 1,100 19.4% 1,308 0.4%

EBIT 1,090 877 24.3% 1,103 -1.1%

PAT 633 543 16.5% 707 -10.4%

EPS 4.0 3.4 16.5% 4.4 -10.4% Key Things to Look For: Impact of GST rate cut on pricing front, pricing strategy of Morbi

players, increasing Gas costs, demand scenario in real estate and launch of newer

projects EBITDA Margin 17% 17% 26 bps 18% -126 bps


April 9, 2018 of 54

Pokarna 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 948 879 7.8% 1,000 -5.3% Expect some improvement in Granite division due to focus on cut to size business while

Quartz division growth might remain impacted due to company's increased focus on

higher margin unique colors as highlighted in their earlier concalls. Margin in quartz

would remain stable. Interest costs are expected to be lower yoy due to company being

able to renegotiate its interest rates.

EBITDA 317 299 5.8% 329 -3.7%

EBIT 263 248 5.8% 278 -5.6%

PAT 152 145 4.6% 179 -15.3%

EPS 4.9 4.7 4.6% 5.8 -15.3% Key Things to Look For: Revival in granite volumes, Capacity utilization in quartz

business and progress of new quartz capex EBITDA Margin 33% 34% -64 bps 33% 53 bps

Shankara Building Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 6,722 6,246 7.6% 6,004 12.0% Retail to report strong high teen growth. Vaigai numbers will be part of Q4FY18. Margin

improvement in retail will be visible offset by pressure in channel & enterprise segment. EBITDA 520 408 27.2% 457 13.7%

EBIT 483 375 28.7% 428 12.9%

PAT 268 177 51.9% 191 40.6%

EPS 11.7 7.7 51.9% 8.4 40.6% Key Things to Look For: SSG Growth, Retail Margin outlook


Somany Ceramics 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,077 3,857 57.6% 5,596 8.6% We expect company to post sales growth of 8.6% yoy as 4Q17 was impacted by

demonetisation. New demand remains subdued from real estate market due to RERA.

EBITDAM will improve 100bps q/q aided by better product mix though gas costs might

impact the margins

EBITDA 517 288 79.2% 508 1.7%

EBIT 446 221 102.3% 437 2.2%

PAT 293 143 104.4% 291 0.8%

EPS 6.9 3.4 104.4% 5.9 17.2% Key Things to Look For: Impact of GST rate cut on pricing front, pricing strategy of Morbi

players, increasing Gas costs, demand scenario in real estate and launch of newer

projects EBITDA Margin 9% 7% 103 bps 9% -58 bps

Supreme Ind. Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 14,278 12,781 11.7% 12,826 11.3% Plastic revenue to increase 13% on weak base. Last year margin were higher on inventory

gains and better sourcing. EBITDA 2,584 1,978 30.7% 2,426 6.5%

EBIT 2,138 1,550 37.9% 2,015 6.1%

PAT 1,389 987 40.7% 1,273 9.1%

EPS 10.9 7.8 40.7% 10.0 9.1% Key Things to Look For: Raw material cost, price hike and demand for new products



April 9, 2018 of 54

Chemicals

Atul Ltd. 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 8,695 8,037 8.2% 7,196 20.8%

Sales growth is expected to remain strong given the price hikes that have come in across

various segments while EBIDTAM on a qoq basis are expected to remain stable leading to

strong profitability growth on a yoy basis.

EBITDA 1,356 1,261 7.5% 1,014 33.7%

EBIT 1,097 1,002 9.5% 764 43.6%

PAT 835 660 26.5% 639 30.7%

EPS 28.2 22.2 27.0% 21.5 31.2% Key Things to Look For: EBITM trends in various business segments


Solar Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 4,971 4,657 6.7% 4,421 12.4%

Volume growth in Bulk explosives is likely to remain strong given the mining season while

South Africa operations should start contributing to revenue growth. EBIDTAM are

expected to remain steady on a qoq basis.

EBITDA 1,120 1,043 7.3% 896 24.9%

EBIT 976 906 7.7% 796 22.6%

PAT 621 542 14.6% 549 13.1%

EPS 6.9 6.0 14.7% 6.1 13.0% Key Things to Look For: Defence order book, EBIDTAM trends



April 9, 2018 of 54

Construction

Outlook

In FY18, NHAI awarded 150 road projects covering 7,400 km worth Rs.1.22tn and

completed construction of 3,070 km. In last 5 years, the average length of road

projects awarded by NHAI was 2,860 km with 4,335 Km awarded in the last financial

year. We expect the ordering activity to remain strong for next year, particularly

for 1H19 as well as NHAI continues to focus on awarding of Bharatmala projects.

Order books of all the construction companies are at all-time high and most of them

currently have revenue visibility between 4-4.5x (OB/TTM revenues). Toll collections

across various BOT projects are also seeing gradual improvement. We expect a

healthy growth in execution to continue in FY19 as well. While the overall

environment remains favorable, we would remain cautious on companies with a

continuous surge in EPC business net debt and high levels of core working capital.

Top Picks: Ashoka Buildcon, Sadbhav Engineering and Sadbhav Infra

Ashoka Buildcon (SA) 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 7,527 6,589 14.2% 6,100 23.4%

Expect 23% growth in revenues led by higher execution. EBITDAM is expected to improve due to higher contribution from Road projects. Robust order pipeline is expected to provide a boost in revenues going ahead.

EBITDA 1,006 796 26.4% 636 58.2%

EBIT 868 651 33.2% 489 77.6%

PAT 647 520 24.4% 658 -1.8%

EPS 3.5 2.8 24.4% 3.5 -1.8% Key Things to Look For: Pick up in pace of execution on recent EPC/HAM Project Wins,

EBITDA margins EBITDA Margin 13% 12% 129 bps 10% 294 bps

KNR Constructions 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,790 4,332 33.7% 4,821 20.1% Expect 20% revenue growth yoy on back of ramp up from existing projects. Margins are

expected to remain around 18% due to higher other operational income though qoq they

are expected to fall as quantum of other operational income would be lower. Robust

order pipeline is expected to provide a boost in revenues going ahead.

EBITDA 1,038 984 5.5% 723 43.6%

EBIT 652 612 6.4% 528 23.5%

PAT 549 657 -16.5% 525 4.6%

EPS 3.9 4.7 -16.5% 3.7 4.6% Key Things to Look For: Execution pace for New orders, EBITDA margin, BOT Projects

Performance EBITDA Margin 18% 23% -479 bps 15% 293 bps

PNC Infratech 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,959 4,725 26.1% 3,506 70.0%

We expect a 70% growth in sales led by higher execution and low base of 4Q17. EBITDA

margins are likely to remain stable at 14.5-15%.

EBITDA 865 663 30.5% 475 82.2%

EBIT 661 467 41.4% 335 97.3%

PAT 564 931 -39.4% 338 66.9%

EPS 2.2 3.6 -39.4% 1.3 66.9% Key Things to Look For: Traffic growth, EPS scenario, commencement of work at the new

Hybrid Annuity projects, WC improvement EBITDA Margin 15% 14% 49 bps 14% 97 bps


April 9, 2018 of 54

Sadbhav Engineering 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 11,744 9,351 25.6% 10,329 13.7%

Expect 14% yoy revenue growth due to healthy execution pace in most projects. While

EBITDAM is expected to remain stable at 11%.

EBITDA 1,337 1,056 26.6% 1,096 22.0%

EBIT 1,088 809 34.4% 854 27.5%

PAT 807 531 51.9% 683 18.2%

EPS 4.7 3.1 51.9% 4.0 18.2% Key Things to Look For: Project Execution, WC Improvement


Sadbhav Infra 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 3,708 6,244 -40.6% 3,885 -4.6%

Expect strong growth in toll revenues on back of improving traffic scenario across the

project portfolio. HAM projects will start contributing meaningfully going ahead.

EBITDA 2,329 2,962 -21.4% 2,276 2.3%

EBIT 1,631 2,294 -28.9% 1,608 1.4%

PAT (147) (398) -63.1% (959) -84.7%

EPS (0.4) (1.1) -63.1% (2.7) -84.7% Key Things to Look For: Reduction in Interest rates due to refinancing, Traffic growth

EPS scenario, commencement of work at the new Hybrid Annuity projects EBITDA Margin 63% 47% 1536 bps 59% 421 bps


April 9, 2018 of 54

Consumer Durable

Outlook

Given the favorable base in case of many consumer companies this quarter is likely

to remain stable on an qoq basis with margins also remaining stable. Price hikes are

likely to come in across various products given the higher prices of crude and certain

products where price hikes werent implemented post GST implementation.

We expect decent volume growth during the quarter in the home appliances space

esspecially for companies in the cooling product categories. The sales for the cooling

product companies have been delayed by around 20-25 days due to delay in the

onset of summer. In the discretionary space we expect strong set of operational

performance from Jubilant FoodWorks on the back of favorable base and sustainable

initiatives by the company.

Top Picks: Jubilant; IFB Industries; Whirlpool of India and KEI Industries.

Finolex Cables 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 7,599 6,568 15.7% 7,153 6.2%

We believe that volumes are likely to remain under pressure on the back of slowdown in

sectors like real estate, infra (private), etc. We expect margins to largely remain stable

on yoy and qoq basis.

EBITDA 1,102 981 12.3% 1,011 9.0%

EBIT 992 874 13.5% 886 12.0%

PAT 832 749 11.1% 755 10.3%

EPS 5.4 4.9 11.1% 4.9 10.3% Key Things to Look For: Demand Outlook on House wires, HV and EHV cables


Havells 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 25,171 19,658 28.0% 18,315 37.4%

Strong sales growth is largely driven on account of Lloyd inclusion. Growth in core

business divisions is likely to be driven by Lighting and ECD division, while wires & cables

and switchgears division is likely to remain under pressure.

EBITDA 3,375 2,622 28.7% 2,296 47.0%

EBIT 3,006 2,259 33.0% 1,988 51.2%

PAT 2,377 1,734 37.1% 1,715 38.6%

EPS 3.8 2.8 37.1% 2.7 38.6% Key Things to Look For: Demand Outlook for core business and Outlook on Lloyd


IFB Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,225 5,317 -1.7% 4,292 21.7%

We believe that IFB will continue to register strong topline growth on the back of new

product launches and expansion in distribution network for TL WM. Margins are likely to

improve on qoq and yoy basis.

EBITDA 387 366 5.7% 99 291.7%

EBIT 252 234 7.6% (15) -1769.1%

PAT 198 186 6.3% 27 639.3%

EPS 4.8 4.5 6.3% 0.6 639.3% Key Things to Look For: Margin outlook, update on capacity additions, FY19E guidance



April 9, 2018 of 54

KEI 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 9,041 8,887 1.7% 7,398 22.2%

We believe that KEI is one of company in the wires & cables space that is likely to

deliver strong operational performance during the quarter. Stable debt levels and

control over finance costs is likely to result in strong profitability.

EBITDA 1,000 843 18.7% 736 36.0%

EBIT 919 761 20.7% 659 39.4%

PAT 441 390 13.0% 316 39.4%

EPS 5.7 5.0 13.0% 4.1 39.4% Key Things to Look For: Order book status, CAPEX Outlook, Debt repayment plans, Status

on retention money EBITDA Margin 11.1% 9.5% 158 bps 9.9% 112 bps

Symphony 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 2,142 2,176 -1.6% 1,841 16.4%

We expect high single digit volume growth during the quarter on expectation of 15-20

days delay in summer arrival. However, we expect strong expansion of profitabilty on

yoy basis on the back of normal pricing and favorable product mix.

EBITDA 787 868 -9.3% 495 58.9%

EBIT 776 856 -9.3% 485 59.9%

PAT 640 663 -3.5% 467 37.0%

EPS 9.1 9.5 -3.6% 6.7 36.9% Key Things to Look For: Demand outlook, Competitive environment, Weather conditions

across the country EBITDA Margin 37% 40% -313 bps 27% 984 bps

VIP Industries 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 3,403 3,380 0.7% 3,072 10.8% Volume growth is likely to be higher than revenue growth with the onset of marriage

season while quantum of price cuts post GST rate revision could affect sales growth to

an extent. Margins are expected to remain stable on an qoq basis leading to strong

growth in profitability.

EBITDA 404 412 -2.0% 307 31.3%

EBIT 371 378 -1.9% 275 34.9%

PAT 262 269 -2.6% 189 38.6%

EPS 1.9 1.9 -2.6% 1.3 38.1% Key Things to Look For: Volume growth, Impact of currency


Whirlpool of India 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 11,676 9,580 21.9% 10,146 15.1% We expect the strong sales momentum to continue during the 4Q as well resulting in

healthy sales growth. Further, we expect margins to improve on qoq basis on the back of

price hikes in January and favorable product mix.

EBITDA 1,290 891 44.7% 1,246 3.6%

EBIT 993 643 54.4% 997 -0.4%

PAT 807 531 51.9% 744 8.5%

EPS 6.4 4.2 51.9% 5.9 8.5% Key Things to Look For: Response on launch of FL WM in newer geographies, distribution

network expansion EBITDA Margin 11% 9% 175 bps 12% -123 bps


April 9, 2018 of 54

Consumer Staple

Top Picks: Britannia, Marico, VIP & GSK Consumer.

Apex Frozen Foods 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 2,070 2,628 -21.3% NA NA We estimate APEX to post revenues of ~Rs. 2,070mn (-21% qoq as 4Q is a seasonally weak

quarter for shrimp processing) in 4QFY18. The margins are estimated to remain stable as

the company is focussing on value added products.

EBITDA 209 300 -30.4% NA NA

EBIT 185 276 -33.0% NA NA

PAT 119 188 -36.9% NA NA

EPS 3.8 6.0 -36.9% NA NA Key Things to Look For: 1) Capacity utilization of the processing plant, 2) Spread

between raw shrimp and processed shrimp prices EBITDA Margin 10% 11% -132 bps NA NA

Avanti Feeds 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 8,467 7,064 19.9% 7,044 20.2% We estimtate 20% yoy/qoq top line growth for Avanti Feeds in 4QFY18 driven by strong

growth in both feed and processing segments. Company has recently started commercial

production at a new 175,000 MTPA feed plant; it will start contributing from 1QFY19

onwards. We expect ~390bps qoq compression in EBITDAM as RM prices have firmed up

recently.

EBITDA 1,509 1,536 -1.7% 1,281 17.8%

EBIT 1,433 1,466 -2.2% 1,243 15.3%

PAT 999 1,005 -0.6% 839 19.1%

EPS 22.0 22.1 -0.6% 18.5 19.1% Key Things to Look For: 1) Capacity utilization in the shrimp processing business and

recently added shrimp feed unit 2) Margins in shrimp feed segment as RM prices have

inched up EBITDA Margin 18% 22% -392 bps 18% -36 bps

Bajaj Corp 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 2,257 2,081 8.5% 2,045 10.4%

EBIDTAM are likely to remain stable with volumes increasing at a steady pace given the

pick-up in wholesale channel. Inflation in LLP prices could lead to price hikes during

FY19.

EBITDA 734 678 8.3% 662 10.9%

EBIT 719 659 9.1% 648 11.0%

PAT 642 552 16.3% 527 21.8%

EPS 4.4 3.7 18.9% 3.6 22.2% Key Things to Look For: Demand outlook and volume growth trends



April 9, 2018 of 54

Britannia 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 25,436 25,675 -0.9% 22,444 13.3% BIL is likely to deliver steady quarter with benefits of raw material price correction

likely to come in during FY19. Other expenses would be kept on a tight control by the

company leading to strong growth in profitability.

EBITDA 3,910 3,984 -1.9% 3,081 26.9%

EBIT 3,565 3,655 -2.5% 2,759 29.2%

PAT 2,727 2,615 4.3% 2,109 29.3%

EPS 22.7 22.0 3.5% 17.6 29.3% Key Things to Look For: Demand outlook and progress on new ventures


CCL Products 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 3,088 2,740 12.7% 2,970 4.0%

We expect muted growth on yoy basis on account of decent base. We believe that the

margins have bottomed out and are likely to remain around 23%.

EBITDA 711 645 10.3% 640 11.2%

EBIT 624 560 11.4% 563 10.8%

PAT 436 404 8.0% 353 23.7%

EPS 3.3 3.0 8.0% 2.7 23.7% Key Things to Look For: Order book for FY19E, Outlook on FY19E product mix


Colgate Palmolive India Ltd. 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 11,564 10,333 11.9% 10,375 11.5%

With wholesale recovering sales growth is expected to pick up on a qoq basis while some

reduction in overhead costs will keep profit growth healthy.

EBITDA 3,128 2,824 10.8% 2,443 28.0%

EBIT 2,738 2,429 12.7% 2,102 30.3%

PAT 1,912 1,699 12.5% 1,426 34.1%

EPS 7.0 6.3 11.1% 5.2 34.6% Key Things to Look For: Market share trends, Volume growth


GSKCH 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 12,246 10,347 18.4% 11,019 11.1% Post a strong 3QFY18 growth momentum is expected to continue for the company driven

mainly by Horlicks. Gross margins are expected to remain stable on an qoq basis leading

to strong operating profit growth on an yoy basis.

EBITDA 2,608 2,040 27.8% 2,171 20.1%

EBIT 2,431 1,888 28.8% 1,994 21.9%

PAT 2,093 1,655 26.5% 1,786 17.2%

EPS 49.8 38.9 27.9% 41.8 19.1% Key Things to Look For: Volume growth, Demand outlook



April 9, 2018 of 54

Jubilant Food 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 7,527 7,952 -5.3% 6,128 22.8% We expect strong growth in topline on the back of strong SSSg of 21%. Strong SSSg is on

the back of favorable base and several company initiatives which seems sustainable

(which is also likely to result in strong growth in profitabilty)

EBITDA 1,213 1,369 -11.4% 605 100.5%

EBIT 796 976 -18.4% 167 376.7%

PAT 565 660 -14.4% 189 199.1%

EPS 8.6 10.0 -14.4% 2.9 199.1% Key Things to Look For: Guidance on new stores, price hikes, Outlook on DD


Jyothy Labs 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 4,873 4,312 13.0% 4,462 9.2%

JYL is expected to post a steady quarter while earnings growth looks higher on account

of lower base during the previous year. EBIDTAM are expected to be in the range of

16.5%.

EBITDA 810 693 16.9% 606 33.6%

EBIT 730 615 18.7% 523 39.6%

PAT 558 342 63.2% 1,087 -48.7%

EPS 3.1 1.9 60.7% 6.0 -48.7% Key Things to Look For: Growth rate in Ujala, Volume growth for company


Marico 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 15,858 16,243 -2.4% 13,146 20.6%

Sales growth is likely to be driven by price hikes in Parachute rigids while growth rate in

Saffola could remain subdued. EBIDTA growth will lag sales growth due to higher RM

prices.

EBITDA 2,934 3,021 -2.9% 2,595 13.1%

EBIT 2,704 2,807 -3.7% 2,321 16.5%

PAT 2,129 2,130 0.0% 1,634 30.3%

EPS 1.7 1.7 -3.5% 1.3 26.0% Key Things to Look For: Volume growth, RM price outlook


P&G Hygiene 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,664 7,042 -5.4% 6,011 10.9%

Steady growth is expected in sanitary napkins while growth in VICKS could still be lagging

behind. Gross margins are expected to remain steady with EBIDTA increasing mainly on

account of cost controls.

EBITDA 1,852 2,102 -11.9% 1,538 20.4%

EBIT 1,722 1,967 -12.5% 1,396 23.4%

PAT 1,219 1,312 -7.1% 996 22.4%

EPS 37.5 40.4 -7.2% 30.7 22.1% Key Things to Look For: Growth in Sanitary Napkins & Vic



April 9, 2018 of 54

Financial Services

Outlook:

While Yields had been hardening for most part of the quarter, various event in the

second half of March like i) lower than expected Govt. borrowings calendar in

1HFY19, ii) RBI relaxing norms for provisioning on NCLT norms as well as for MTM on

investments has led to much needed softening of the yield. This would result in SOE

as well as select banks Pvt. bank getting relief for provisions for 4QFY18. However,

overall cost of borrowings for NBFCs has inched up during the quarter with CANF

increasing rates on home loans

Systemic loan growth remained in low double digits during 4QFY18 with private

sector banks garnering significant share of incremental growth.

SOE banks received the first phase of capital infusion in the fag end of the quarter

which will likely aid Tier 1 capital. However, this is unlikely to result in credit uptick

for SOE banks

Within our coverage large Pvt. Banks are likely to report NII growth of ~13% yoy

(dragged by ICICIBC at flat yoy) and regional banks at 12% yoy (dragged by KVB -1%

yoy). Provisioning likely to remain elevated for ICICIBC, KVB, SIB.

We expect healthy loan book growth for the large private sector banks under our

coverage led by Yes bank at ~35%, IndusInd bank at ~25%, HDFC bank at ~20% and

ICICI bank at ~15%. Loan growth for south based regional banks is likely to be in mid-

teens.

Within our coverage we expect CUBK, HDFCB, IIB, YES, CANF, Equitas, LTFH, Ujjivan

and AUSFB to report PAT above 20%.

Top pick: Yes Bank, ICICI Bank, South Indian Bank

AU Small Finance Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 3,091.5 2,504.3 23.5% 2,264.0 36.6% NIMs are expected to increase on account of Bank thrust to increase deposit base

leading to decline in CoFs. Lower C/I ratio as branches become productive and pace of

incremental branch addition moderates.

PPI 1,950.1 1,529.2 27.5% 1,446.3 34.8%

PAT 991.1 789.2 25.6% 779.1 27.2%

EPS 3.5 2.8 25.6% 4.7 -26.5% Key Things to Look For: AUM growth, Asset Quality trends and growth in CASA/Deposits

NIM (%) 6.9% 6.0% 89bps 7.5% -61bps

Cholamandalam 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 8,418.7 7,929.9 6.2% 6,657.3 26.5% - Advances are estimated to grow at ~24% yoy given the higher sales of vehicles during

4QFY18 which will push Vehicle book. Expected picking up in Home Equity

disbursements as adverse impact of Demonetization and GST reduces

- NIMs are estimated to remain flat as CoFs are expected to remain flat despite

increase in yields

PPI 5,003.0 4,694.1 6.6% 3,904.5 28.1%

PAT 2,720.6 2,492.0 3.8% 2,195.5 17.8%

EPS 17.4 15.9 3.7% 14.1 17.7% Key Things to Look For: i) Home Equity Asset Quality ii) Pick up in Home Equity

Disbursements NIM (%) 9.9% 9.9% 1bps 9.4% 50bps


April 9, 2018 of 54

CanFin Homes 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 1,351 1,279 5.6% 1,189 13.7% As repayment rates remain elevated, we expect the loan growth of ~20% yoy. Pricing

pressure and higher incremental cost of funds to lead to NII to lag advances growth.

Shift towards self-employed will likely continue. C/I ratio and credit cost likely to

remain contained.

PPI 1,311 1,236 6.1% 1,112 17.9%

PAT 854 801 6.7% 709 20.5%

EPS 6.4 6.0 6.7% 5.3 20.5% Key Things to Look For: Disbursements and Repayment trends, commentary on Stake

sale by Canara bank NIM (%) 3.5% 3.5% 2bps 3.7% -17bps

City Union Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 3,762 3,651 3.0% 3,106 21.1% Advances growth at ~17% yoy is likely to be driven by working capital loans. Total

income growth to be ahead of the balance sheet growth with NII growing at 21% yoy. PPI 2,954 2,965 -0.4% 2,476 19.3%

PAT 1,563 1,548 1.0% 1,289 21.3%

EPS 2.4 2.3 1.3% 2.1 10.2% Key Things to Look For: Loan growth and NIM trends, Asset quality

NIM (%) 4.4% 4.4% -1bps 4.1% 36bps

DCB Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 2,574 2,505 2.8% 2,203 16.9% We expect loan growth to remain robust at ~24%-26%. Treasury losses for DCB are likely

to be contained owing to Surplus SLRs being <2%. There may be some uptick in

slippages from loans to MSME segment/LAP

PPI 1,259 1,225 2.8% 1,153 9.2%

PAT 607 570 6.5% 529 14.8%

EPS 2.0 1.9 10.7% 1.9 10.7% Key Things to Look For: Mix of loan growth, Asset quality, Commentary on C/I Ratio

NIM (%) 4.1% 4.1% 1bps 4.2% -3bps

Equitas Holdings 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 2,554 2,351 8.6% 2,214 15.3% Expect robust loan growth of above 30% yoy on subdued base. NIMs on Gross AUM to

improve as rundown of MFI loans are complete and Share of off-balance sheet AUM

declines. Provisioning to trend lower qoq as Equitas provisioned towards stressed MFI

loans

PPI 598 416 43.6% 520 15.0%

PAT 258 (300) nm 69 273.5%

EPS 0.8 (0.9) nm 0.2 277.8% Key Things to Look For: Fresh disbursements mix, Trends in CASA/bulk deposit

NIM (%) 9.0% 8.7% 34bps 9.1% -8bps


April 9, 2018 of 54

HDFC Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 107,027 103,143 3.8% 90,551 18.2% We expect NII/PAT growth of 18% yoy/ 20% yoy, Loan growth of ~20% yoy. NIM to

remain stable qoq . PPI 81,872 84,512 -3.1% 72,794 12.5%

PAT 47,996 46,425 3.4% 39,901 20.3%

EPS 18.7 17.9 4.6% 15.5 20.8% Key Things to Look For: QIP details, Trends in retail asset quality, Composition of loan

growth NIM (%) 4.3% 4.3% 2bps 4.3% 2bps

ICICI Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 59,530 57,053 4.3% 59,622 -0.2% We expect loan growth of ~14% with ~5bp qoq decline in NIM as Avg CASA ratio

declines. Fee income growth to strong aided by ~Rs31bn of income from stake sale of

ICICI Securities. We expect provisioning to remain elevated with credit cost of above

3% on account of provisioning towards stressed assets.

PPI 79,500 50,578 57.2% 51,120 55.5%

PAT 22,953 16,502 39.1% 20,246 13.4%

EPS 3.8 2.6 46.0% 3.5 7.9% Key Things to Look For: Quantum of accelerated/Floating provisioning, Guidance on

Impact of change in restructuring norms NIM (%) 3.1% 3.1% -6bps 3.6% -49bps

IndusInd Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 19,608 18,948 3.5% 16,675 17.6% Expect NIM to remain stable, Loan growth to be driven by retail with vehicle loan

growth likely to accelerate. Traction in CASA growth to sustain. PPI 17,768 16,647 6.7% 15,722 13.0%

PAT 9,567 9,362 2.2% 7,516 27.3%

EPS 15.9 15.6 2.1% 12.6 26.5% Key Things to Look For: Guidance on strategy post BhaFin merger, Mix of loan growth

NIM (%) 4.0% 4.0% 3bps 4.0% 0bps

Karur Vysya Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 5,739 5,616 2.2% 5,800 -1.1% With an AFS investment of ~Rs 51bn, KVB is likely to see provision on investment

depreciation of ~Rs200mn. We expect Loan growth of ~14% yoy with ~10bp qoq

moderation in NIM. Provisions towards NPAs are likely to be lower qoq.

PPI 4,363 4,212 3.6% 5,071 -14.0%

PAT 1,215 715 70.0% 2,176 -44.2%

EPS 1.8 1.0 74.7% 3.6 -49.1% Key Things to Look For: Impact on AFS book due to adverse yield movement, Fresh

slippages NIM (%) 3.7% 3.8% -9bps 4.1% -46bps


April 9, 2018 of 54

L&T Finance Holding 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 10,365 9,865 5.1% 7,961 30.2% Retail and real estate segment growth likely to remain strong. NIM to remain flat qoq.

Growth in wholesale fee income may moderate, however fee income from investment

and wealth management segments likely to remain robust. Provisioning to remain

elevated owing to MFI and legacy wholesale book.

PPI 10,170 9,409 8.1% 7,738 31.4%

PAT 3,922 3,845 2.0% 3,158 24.2%

EPS 2.2 2.1 2.0% 1.7 24.2% Key Things to Look For: Trends in wholesale fee income, management commentary on

Infra/renewable lending NIM (%) 4.9% 4.9% 0bps 4.7% 23bps

Power Finance Corp 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 26,171.7 19,660.0 33.1% 15,380 70.2% - We expect decline in Provisions at transitioning of RBI norms near completion

- NIMs are expected to decline owing to rising competition and slow credit pick up in

the industry

PPI 25,520.9 18,929.8 34.8% 16,269 56.9%

PAT 19,573.6 16,044.3 22.0% (34,102) NM

EPS 7.4 6.1 22.0% (12.92) NM Key Things to Look For: i) Upgradation of accounts slipped to NPA post RBI norm ii)

Loan growth NIM (%) 4.0% 3.0% 93bps 2.6% 140bps

Rural Electrification 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 20,691.4 20,359.2 1.6% 22,949 -9.8% - NIMs are estimated to remain stable given REC's inclination towards diversifying of

book

- No improvement in Asset Quality owing to slowdown in economy

PPI 21,610.9 20,800.9 3.9% 25,026 -13.6%

PAT 13,469.3 12,964.1 3.9% 13,182 2.2%

EPS 6.8 6.6 3.9% 6.67 2.2% Key Things to Look For: i) Loan growth ii) Improvement in Asset Quality

NIM (%) 3.7% 3.7% -1bps 4.5% -84bps

South Indian Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 5,258 5,094 3.2% 4,391 19.8% We expect loan growth of 16% yoy, leading to NII growth of ~20%. Core Fee income

growth to be ~25%. With the recent correction in yields and RBI circular allowing

spreading of MTM losses, MTM on AFS investments is likely to be contained

PPI 3,442 3,302 4.3% 2,808 22.6%

PAT 865 1,150 -24.8% 755 14.5%

EPS 0.5 0.6 -24.8% 0.5 0.1% Key Things to Look For: Trend in Fresh slippages/Watchlist, mix of Loan growth

NIM (%) 2.9% 3.0% -2bps 2.8% 19bps


April 9, 2018 of 54

Ujjivan 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 2,182 1,958 11.4% 1,283 70.0% Disbursements trend to show sustained improvement driven by MFI loans. Cumulative

collection efficiency likely to remain robust. PPI 828 754 9.9% 418 98.3%

PAT 389 293 32.5% 193 101.0%

EPS 3.2 2.4 32.6% 1.6 98.9% Key Things to Look For: Progress on CASA and Deposits, Traction in new product

launches NIM (%) 10.7% 11.8% -106bps 8.6% 212bps

YES Bank 4Q18E 3Q18A QoQ (%) 4Q17A YoY (%) Comments & Outlook

Net Interest Income 20,281 18,888 7.4% 16,397 23.7% Expect healthy loan growth of ~35% yoy with moderation in NIM owing to pressure on

YoA. Expect NII/PAT growth of 24%/26% yoy. PPI 21,006 20,018 4.9% 16,910 24.2%

PAT 11,519 10,769 7.0% 9,141 26.0%

EPS 5.0 4.7 7.4% 4.2 21.0% Key Things to Look For: NIM, Asset quality and credit cost

NIM (%) 3.4% 3.5% -15bps 3.6% -25bps


April 9, 2018 of 54

Industrials

Top Picks: Power Mech

AIA Engineering 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,178 5,722 8.0% 6,476 -4.6% We expect the volumes to grow 5% yoy driven primarily by growth in mining. Sales is

however expected to drop as 4QFY17 included Rs 200mn one off other operating income.

On the qoq basis we expect the revenue to grow by about 8% and margins to improve by

~102bps.

EBITDA 1,433 1,269 13.0% 1,600 -10.4%

EBIT 1,206 1,090 10.7% 1,391 -13.3%

PAT 1,062 1,023 3.8% 1,029 3.2%

EPS 9.4 12.3 -23.8% 11.6 -18.8% Key Things to Look For: Volume growth and margins


Genus Power 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 2,035 2,002 1.6% 1,446 40.7% We expect higher execution in metering and ECC to lead to 40% growth in Net Sales in

4QFY18E. Metering activities in the country have improved from 3QFY18 and we expect

implementation of UDAY, IPDS, DDUGJY and Saubhagya schemes to be beneficial for

metering industry in FY18E/FY19E. Order book built up for the quarter will be key aspect

to watch out for.

EBITDA 223 201 11.0% 119 87.7%

EBIT 181 158 14.5% 81 122.4%

PAT 147 134 9.3% 156 -5.9%

EPS 0.6 0.6 10.8% 0.6 1.2% Key Things to Look For: Order book, EBITDAM, Reduction in L&A


Greaves Cotton 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 4,747 4,473 6.1% 3,907 21.5%

We expect a strong traction in the 3W Volumes and are expecting 30% growth on the low

base of last year. We expect the revenue growth of 21% yoy, which is expected to be

translated into the margin expansion of 115bps yoy and 88bps qoq.

EBITDA 703 622 12.9% 533 31.7%

EBIT 572 491 16.6% 408 40.2%

PAT 489 558 -12.3% 469 4.2%

EPS 2.0 1.4 48.2% 1.7 21.1% Key Things to Look For: Volumes in different segments



April 9, 2018 of 54

Power Mech 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 4,047 2,877 40.6% 3,439 17.7% We expect Power Mech to deliver yoy Sales/PAT growth of 18%/48% in 4QFY18E led by

improvement in revenues from Civil and O&M . We expect interest cost to go up yoy due

to higher debt in 3QFY18. We remain confident of increasing revenues share of O&M and

Civil and expansion in international market to lead to strong double digit growth in

FY19E. We will watch out for order inflows and margins.

EBITDA 535 368 45.6% 385 38.9%

EBIT 427 278 53.2% 292 46.1%

PAT 242 135 79.0% 164 47.5%

EPS 16.5 9.1 80.3% 10.9 51.2% Key Things to Look For: Order Book, EBITDAM


TD Power 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 1,255 945 32.7% 1,289 -2.7% We remain positive on the company due to inevitable domestic capex revival, gradual

order book built up and increases in exports turnover. Better order inflows and

improvement in exports margins will be the key triggers.

EBITDA 121 43 179.7% 133 -8.9%

EBIT 57 (24) -340.8% 64 -10.1%

PAT 60 199 -70.0% 106 -44.0%

EPS 1.8 (0.7) -361.0% 3.2 -44.0% Key Things to Look For: Order inflows, EBITDAM


Triveni Turbine 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 2,634 1,650 59.6% 1,790 47.2% We expect flat revenues growth and decline in margins yoy due to weak domestic

market and stiff competition. We remain positive on the company and are confident of

the direction of the order book & favorable change in product mix going ahead. We will

be watching out for order inflows and performance of GE Triveni JV.

EBITDA 674 321 109.8% 375 79.6%

EBIT 624 275 127.2% 334 86.9%

PAT 438 210 108.5% 272 61.2%

EPS 1.3 0.6 108.5% 0.8 61.2% Key Things to Look For: Order inflows, Aftersales revenues



April 9, 2018 of 54

IT Services

Outlook

4QFY18 US$ revenue growth within our tier-I coverage universe could range 1.5%-

2.7% qoq with cross currency tailwinds of ~100bps driven by 4.5%, 4.1%, & 2.1%

appreciation in the GBP, EUR and AUD vs. the USD. HCLT (2.7%) could lead driven by

IP contribution, followed by TCS (2.4%), TechM (2.1%), Wipro (2%) and Infosys (1.5%).

EBITM could be flat to 63bps qoq improvement primarily driven by operational

efficiency. That said, all eyes would be on Infosys guidance as consensus appears

aggressive. Our recent checks suggest that guidance process is being centralised and

generally this implies conservativism. We believe, Infosys could start the year with

CC growth guidance of 5.5-7.5%

Within our midcap universe, Cyient’s US$ revenues could increase 7.5% qoq (82% qoq

growth in DLM business due to right shifting of order) while Persistent revenues could

decline 3.3% led by decline in IP revenues. Generally, growth across midcap would

be led by recovery in top client portfolio and deals wins. EBITM generally would be

aided by operational efficiency, and cross currency tailwinds partially offset by

company specific headwinds.

CY18E IT budget spend patterns, demand trends in BFSI, retail verticals &

discretionary projects, continue to be investor interest.

Top Picks: Tech Mahindra, Mphasis

Cyient 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 163 152 7.5% 141 15.9%

US$ revenues could increase 7.5% qoq led by 81.9% qoq growth in DLM aided by services

(1.1%) business. EBITDA margins could decline 17bps qoq to 14.4% led by mix change to

lower margin DLM business. Normalised tax rates would ensure that sequential PAT growth

is modest while yoy growth is amplified due to RSU charge in 4QFY17.

Net Sales(Rs.) 10,523 9,834 7.0% 9,410 11.8%

EBIDTA 1,514 1,431 5.8% 1,249 21.2%

EBIT 1,232 1,157 6.4% 994 23.9%

PAT 1,070 1,086 -1.5% 786 36.1%

EPS 9.6 9.7 -1.5% 7.0 36.1% Key Things to Look For: Deal pipeline in services and DLM business. Aero vertical/top

customer updates. Margin trajectory for DLM business. EBITDA Margin 14.4% 14.6% -17 bps 13.3% 111 bps

eClerx 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 51 49 3.6% 48 5.8%

US$ revenues could increase 3.6% qoq as growth in non-top 5 could be aided by modest

recovery in top 5. EBITDA margins could expand 251bps qoq to 29.1% driven by growth and

operational efficiency.

Net Sales(Rs.) 3,495 3,399 2.8% 3,315 5.4%

EBIDTA 1,018 904 12.5% 1,116 -8.8%

EBIT 888 779 14.1% 979 -9.3%

PAT 721 575 25.3% 748 -3.6%

EPS 17.7 14.1 25.3% 18.3 -3.6% Key Things to Look For: Demand trends across businesses, impact of insourcing and

automation. EBITDA Margin 29.1% 26.6% 251 bps 33.7% -454 bps


April 9, 2018 of 54

HCL Tech 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 2,042 1,988 2.7% 1,817 12.4%

US$ revenues could grow 2.7% qoq to $2,042 mn driven by organic growth, IP partnership,

& cross currency tailwind. EBIT margins could increase 42bps qoq to 20% led by efficiency,

partially offset by lower IP contribution.

Net Sales(Rs.) 131,479 128,080 2.7% 120,530 9.1%

EBIDTA 30,402 29,640 2.6% 26,490 14.8%

EBIT 26,308 25,090 4.9% 24,160 8.9%

PAT 22,799 21,940 3.9% 23,280 -2.1%

EPS 16.3 15.7 3.9% 16.7 -2.1% Key Things to Look For: FY19e guidance, IMS, ERD deal closures. Update to IBM IP

partnerships and incremental spends in FY19e. EBIT Margin 20.0% 19.6% 42 bps 20.0% -4 bps

Hexaware 2QCY18E 1QCY18 QoQ (%) 2QCY17 YoY (%) Comments & Outlook

US $ Revenue 161 156 2.9% 145 11.0%

US$ revenues could increase 2.9% qoq to US$ 161 mn led by ramp-up in new deal wins.

EBITDA margins could increase 24bps qoq to 16.2% as tailwinds from growth & operational

efficiency could be offset by impact of transition costs associated with new deals and

client specific issues.

Net Sales(Rs.) 10,346 10,048 3.0% 9,605 7.7%

EBIDTA 1,672 1,599 4.5% 1,623 3.0%

EBIT 1,508 1,441 4.7% 1,466 2.9%

PAT 1,370 1,212 13.1% 1,140 20.2%

EPS 4.6 4.1 13.1% 3.8 20.2% Key Things to Look For: Outlook for top 10 customers. Demand trends across verticals and

discretionary services. Portfolio challenges due to insourcing. IMS and BPO growth

trajectory. EBITDA Margin 16.2% 15.9% 24 bps 16.9% -74 bps

Infosys 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 2,797 2,755 1.5% 2,569 8.9%

US$ revenues could increase 1.5% qoq to $2,797 mn led by constant currency revenue

growth of 0.5% and ~100bps of cross currency tailwind. We expect EBIT margins to be flat

qoq at 24.3% as cross currency tailwinds could be offset by modest growth and wage hikes

for titleholders.

Net Sales(Rs.) 180,099 177,940 1.2% 171,200 5.2%

EBIDTA 48,833 48,170 1.4% 46,580 4.8%

EBIT 43,789 43,190 1.4% 42,120 4.0%

PAT 35,461 51,290 -30.9% 36,030 -1.6%

EPS 15.5 22.4 -30.9% 15.7 -1.6% Key Things to Look For: FY19e revenue/margin guidance. Demand trends across verticals.

Large deal TCV and pricing trends. Top level changes. EBIT Margin 24.3% 24.3% 4 bps 24.6% -29 bps


April 9, 2018 of 54

KPIT Tech 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 143 141 1.5% 128 11.7%

US$ revenues could increase 1.5% qoq led by momentum in Automotive and transportation.

EBITDA margins could improve 55bps qoq to 11.4% led by alignment of cost structure and

profitability improvement initiatives (including utilization, mix shift towards higher GM

verticals engineering, digital).

Net Sales(Rs.) 9,233 9,128 1.2% 8,585 7.6%

EBIDTA 1,051 989 6.3% 870 20.8%

EBIT 853 786 8.6% 623 37.0%

PAT 677 619 9.3% 537 26.0%

EPS 3.6 3.3 9.3% 2.8 26.0% Key Things to Look For: Demand trends across engineering and SAP business. Updates to

productivity improvement roadmap. FY19e guidance. EBITDA Margin 11.4% 10.8% 55 bps 10.1% 125 bps

L&T Technology Services 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 154 151 2.0% 121 27.0%

$ revenues could increase 2% qoq led by broad based momentum across segments. EBITDA

margins could be flat as tailwinds from operational efficiency would be impacted by

growth in onshore business.

Net Sales(Rs.) 9,915 9,691 2.3% 8,123 22.1%

EBIDTA 1,517 1,485 2.2% 1,338 13.4%

EBIT 1,358 1,340 1.4% 1,191 14.0%

PAT 1,292 1,265 2.1% 965 33.8%

EPS 12.7 12.4 2.1% 9.5 33.8% Key Things to Look For: FY19e revenue growth, margin guidance. Large deal traction.

Outlook across businesses, especially Process. EBITDA Margin 15.3% 15.3% -2 bps 16.5% -117 bps

Mphasis 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 264 258 2.6% 226 16.8%

Revenues could increase 2.6% to Rs. 17,031mn led by Direct core and DXC revenues.

EBITDA margins would be flat qoq at 16.5% driven by productivity improvements and

pyramid correction.

Net Sales(Rs.) 17,031 16,607 2.6% 15,059 13.1%

EBIDTA 2,809 2,742 2.4% 2,384 17.8%

EBIT 2,628 2,566 2.4% 2,200 19.5%

PAT 2,207 2,150 2.6% 1,934 14.1%

EPS 11.4 11.1 2.6% 9.2 24.3% Key Things to Look For: FY19e revenue, ebitda margin outlook. Deal wins and ability to

sustain growth momentum in Direct core and DXC channel. Deal pipeline and wins in

Blackstone portfolio. Cash utilization policy. EBITDA Margin 16.5% 16.5% -2 bps 15.8% 66 bps


April 9, 2018 of 54

NIIT Tech 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 120 117 2.9% 111 8.6% US$ revenues to increase 2.9% qoq to $ 120mn led by digital, GIS (though 4q seasonality

may not be similar to prior 4q’s), NITL, and despite the impact of Morris ramp-down

($1.5mn). EBITDA margins could expand 57 bps to 17.7% led by mix change and operational

efficiency. Signing of large deals could ensure healthy order intake (~US$ 120mn). Hedge

gains may be lower or equal to 3Q (Rs. 97mn)

Net Sales(Rs.) 7,787 7,565 2.9% 7,447 4.6%

EBIDTA 1,379 1,296 6.4% 1,524 -9.5%

EBIT 1,040 985 5.6% 1,212 -14.2%

PAT 874 827 5.7% 1,075 -18.7%

EPS 14.2 13.5 5.7% 17.5 -18.7% Key Things to Look For: Digital wins, executable order book, demand trends, incremental

headwinds, if any, related to Morris EBITDA Margin 17.7% 17.1% 57 bps 20.5% -276 bps

Persistent 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 118 123 -3.3% 109 8.6%

US$ revenues could decline 3.3% qoq given Persistent has guided for US$ 8mn decline in IP

revenues. IBM seasonality and deceleration in old IP products could augment quarterly

weakness. EBITDA margins could decline 321bps to 14.2% driven by decline in IP revenues.

Net Sales(Rs.) 7,629 7,919 -3.7% 7,271 4.9%

EBIDTA 1,080 1,375 -21.5% 1,188 -9.1%

EBIT 706 983 -28.1% 793 -11.0%

PAT 772 917 -15.8% 728 6.0%

EPS 9.6 11.5 -15.8% 9.1 6.0% Key Things to Look For: Growth in IBM OPD and IoT business. Demand trends for other IP's

and margin trajectory. FY19e revenue/margin guidance. EBITDA Margin 14.2% 17.4% -321 bps 16.3% -218 bps

TCS 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 4,904 4,787 2.4% 4,452 10.1%

US$ revenues could increase 2.4% qoq to $ 4,904 mn (cross currency tailwind ~120bps)

driven by momentum in insurance, retail verticals, and recent deal wins. EBIT margins

could expand 51bps qoq to 25.7% primarily due to cross currency tailwinds and operational

efficiency.

Net Sales(Rs.) 315,791 309,040 2.2% 296,420 6.5%

EBIDTA 86,311 82,870 4.2% 81,320 6.1%

EBIT 81,132 77,810 4.3% 76,270 6.4%

PAT 68,682 65,450 4.9% 66,220 3.7%

EPS 35.9 34.2 4.9% 33.6 6.8% Key Things to Look For: BFS/retail vertical spend trends and outlook. Margin commentary

in the backdrop of large insurance deal ramp ups. Perspective on deal activity and

discretionary spends. EBIT Margin 25.7% 25.2% 51 bps 25.7% -4 bps


April 9, 2018 of 54

Tech Mahindra 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 1,234 1,209 2.1% 1,131 9.1%

$ revenues could increase 2.1% qoq led by Comviva seasonality, IP, enterprise, and cross

currency tailwind partially offset by Communications weakness. EBITDA margins could

increase 63bps to 16.9% driven by business mix, improvement in subsidiary profitability,

and operating efficiency.

Net Sales(Rs.) 79,491 77,760 2.2% 74,950 6.1%

EBIDTA 13,429 12,647 6.2% 8,987 49.4%

EBIT 10,579 9,905 6.8% 6,152 71.9%

PAT 9,450 9,431 0.2% 5,880 60.7%

EPS 9.7 9.7 0.2% 6.1 60.7% Key Things to Look For: FY19e revenue margin commentary, Telecom outlook. LCC

strategy updates. Pricing trends for enterprise customers. EBITDA Margin 16.9% 16.3% 63 bps 12.0% 490 bps

Wipro 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

US $ Revenue 2,053 2,013 2.0% 1,955 5.0%

US$ IT revenues could increase 2% qoq (CC at lower end of 1 to 3% guidance) as traction in

large accounts would be offset by client ramp-downs in utilities and potential impact in a

telecom customer. Consolidated EBIT margins (adjusted for customer insolvency charge)

could improve 31 bps led by productivity and mix change.

Net Sales(Rs.) 140,498 136,690 2.8% 139,875 0.4%

EBIDTA 29,285 24,929 17.5% 28,180 3.9%

EBIT 24,000 19,650 22.1% 20,001 20.0%

PAT 20,831 19,371 7.5% 22,611 -7.9%

EPS 4.3 4.0 7.5% 4.6 -7.9% Key Things to Look For: 1QFY19 guidance, top-10 account growth trajectory and

challenges, if any. Demand trends across Energy, Healthcare, & IMS. Acquisition updates. EBIT Margin 17.1% 14.4% 271 bps 14.3% 278 bps


April 9, 2018 of 54

Metal & Mining

Outlook

Hindustan Zinc is expected to post the numbers lower than the last year as last year

the production was skewed towards the second half.

GMDC is also expected to post 40% yoy EBITDA growth driven by 27% yoy volume

growth driven by operating leverage benefits.

Coal India is likely to post strong 98% growth in EBITDA driven by reduction in the

Employee cost and operating leverage benefits

Ratnamani sales are expected to grow by 42% driven by a strong growth of 97% yoy in

the CS volumes.

Top Picks: GMDC

Coal India 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 245,175 216,433 13.3% 231,716 5.8% Margins and sales are expected to grow due to rise in coal prices and increase in volumes

6% yoy. We expect the sharp improvement in the margins owing to 5% reduction in

employee costs yoy. Last year the employee cost was high due to the addition of some

provisions.

EBITDA 67,176 46,179 45.5% 33,876 98.3%

EBIT 59,579 38,668 54.1% 25,378 134.8%

PAT 42,994 32,929 30.6% 27,179 58.2%

EPS 6.9 4.8 43.1% 4.4 58.2% Key Things to Look For: Employee cost and EBITDA


GMDC 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,419 5,061 26.8% 5,439 18.0% We expect the volumes to grow by 27% yoy leading to the revenue growth of 18% yoy.

We expect EBITDA margins to grow by 322 bps qoq and 521 bps yoy. The margin

expansion is expected to come largely due to the operating leverage

EBITDA 2,088 1,483 40.8% 1,486 40.5%

EBIT 1,676 1,107 51.3% 1,050 59.5%

PAT 1,416 955 48.2% 900 57.3%

EPS 4.5 3.0 48.2% 2.8 57.3% Key Things to Look For: Mining segment profits



April 9, 2018 of 54

Hindustan Zinc 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 59,957 59,220 1.2% 62,602 -4.2% Last year production was skewed towards the second half. Thus over the higher base we

expect 22% decline in metal prodiuction transalting into the revenue decline of 4% yoy.

We expect margins to fall by ~300bps yoy

EBITDA 33,986 32,440 4.8% 37,480 -9.3%

EBIT 29,367 27,630 6.3% 32,159 -8.7%

PAT 25,201 20,400 23.5% 30,576 -17.6%

EPS 6.0 5.3 13.0% 7.2 -17.6% Key Things to Look For: Volumes


Ratnamani Metals 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,525 5,356 3.2% 3,884 42.2% Sales growth is primarily expected to be driven by the strong growth of 97% yoy & 21%

qoq in the Carbon steel segment. We expect the SS volumes to degrow by 6% yoy. We

expect margins to remain flat qoq.

EBITDA 912 842 8.3% 685 33.1%

EBIT 755 687 9.9% 532 41.9%

PAT 539 458 17.8% 398 35.4%




April 9, 2018 of 54

Oil & Gas

Outlook

Volume for transmission companies to remain steady. IGL will continue to report

strong volume while GGAS will see volume growth post demand pick up from

industrial customers. GRM to decline marginally. Petchem spread is expanding post

rise in petchem prices. PLNG will report flat volume as Higher LNG price impacted

some demand from power and industrials.

Top Pick: GAIL and GSPL

Apar Ind Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 17,219 14,079 22.3% 12,968 32.8%

Margin to recover post GST slowdown in conductor segment. EBITDA 974 963 1.2% 1,039 -6.2%

EBIT 850 839 1.3% 920 -7.6%

PAT 472 411 15.0% 478 -1.1%

EPS 12.3 10.7 15.0% 12.5 -1.1% Key Things to Look For: Outlook in Transformer oil and Order flow from PGCIL


GAIL Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 147,061 144,143 2.0% 134,520 9.3% Transmission volume will steady at 108mmscmd. LPG EBIT to remain strong. Petchem

EBIT to improve on higher petchem price. EBITDA 21,230 19,699 7.8% 15,553 36.5%

EBIT 17,583 16,031 9.7% 12,082 45.5%

PAT 13,926 12,622 10.3% 10,482 32.9%

EPS 8.2 7.5 10.3% 6.2 32.9% Key Things to Look For: Transmission volume and guidance on trading volume; Petchem

profitability EBITDA Margin 14% 14% 77 bps 12% 287 bps

Gujarat Gas Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 15,713 13,914 12.9% 12,308 27.7% Volume to expand to 6.5mmscmd, +8% yoy and 3% qoq due to improvement in industrial

demand. EBITDA/scm will be at Rs 3.6/scm due to price increase taken in December

end.

EBITDA 1,999 2,027 -1.3% 1,702 17.4%

EBIT 1,311 1,344 -2.4% 1,049 24.9%

PAT 600 611 -1.8% 421 42.7%

EPS 4.4 4.4 -1.8% 3.1 42.7% Key Things to Look For: Volume ramp up, guidance on margin



April 9, 2018 of 54

GSPL Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 3,507 3,502 0.1% 2,446 43.4% Transmission volume to remain around 34mmscmd which is 45% yoy and flattish on qoq

basis. Expect realization at Rs 1120/tscm EBITDA 3,030 2,971 2.0% 2,013 50.5%

EBIT 2,568 2,529 1.5% 1,553 65.3%

PAT 1,820 1,816 0.2% 1,270 43.3%

EPS 3.2 3.2 0.2% 2.3 43.3% Key Things to Look For: Volume growth, Update on tariff


IGL Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 11,929 11,839 0.8% 10,019 19.1% Expect CNG/PNG Volume to report growth of 11%/20% yoy. Overall volume at

5.4mmscmd. Expect EBITDA/scm at Rs 5.6/scm. EBITDA 2,692 2,631 2.3% 2,296 17.3%

EBIT 2,221 2,177 2.0% 1,871 18.7%

PAT 1,706 1,659 2.8% 1,341 27.2%

EPS 2.4 2.4 2.8% 1.9 27.2% Key Things to Look For: Outlook on volume and Ramp-up in Gurgaon/Rewari


Petronet LNG Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 84,947 77,571 9.5% 63,651 33.5% Expect flattish volume in qoq basis. Higher LNG price impacted some demand from

power and industrials. We have also built in 5% higher regas tariff on qoq basis EBITDA 8,669 8,474 2.3% 6,163 40.7%

EBIT 7,587 7,435 2.1% 5,147 47.4%

PAT 5,475 5,288 3.5% 4,708 16.3%

EPS 3.7 3.5 3.5% 3.1 16.3% Key Things to Look For: Commissioning and ramp up of KMB pipeline, spot LNG price


Reliance Industries Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 1,106,387 998,100 10.8% 848,230 30.4%

Expect GRM of $11.6/bbl Petchem volume to expand on Polymer expansion' EBITDA 183,012 175,880 4.1% 122,330 49.6%

EBIT 139,101 130,580 6.5% 88,790 56.7%

PAT 98,712 94,670 4.3% 80,660 22.4%

EPS 16.0 15.4 4.3% 13.1 22.4% Key Things to Look For: Margin outlook in refinery and petchem



April 9, 2018 of 54

Pharma

Outlook:

4Q would continue to see ongoing fundamental issues in Pharma space; 1) Dearth of

high value launches, 2) High price erosion in base portfolio led by higher competition

and channel consolidation 3) Gradual recovery in Dometic channel inventory.

Nevertheless Domestic market would see a rebound with channel inventory levels

enhancing following GST led diruption and lower base last year. It would be a good

quarter for Natco, Cadila, Cipla who would get benefitted by strong contribution

from gTamiflu- led by strong flu season.

Top Picks: IPCA, Cadila

Ajanta Pharma 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,370 5,871 -8.5% 4,768 12.6% We are expecting yoy growth to be mainly led by domestic market, Africa and Asia

business also should see the pickup with enhancing economic situations. Instituional

business is expected to decline as new orders will be shipped from FY19 onwards.

EBITDA 1,772 1,975 -10.3% 1,614 9.8%

EBIT 1,621 1,825 -11.2% 1,425 13.8%

PAT 1,290 1,894 -31.9% 1,140 13.2%

EPS 14.66 15.83 -7.4% 13.0 13.2% Key Things to Look For: Commentary on Institutional allocation, Growth in Asia and

Branded Africa market, Timelines for new launches in US market. EBITDA Margin 33% 34% -64 bps 34% 0 bps

Alembic 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 7,903 8,400 -5.9% 7,378 7.1% Last quarter was aided by bunched up domestic revenues which didn't accrue in first 2

quarters owing to multiple challenges. Ergo, we expect sequnetially decline in domestic

reveneus, while other geographies (incl. US 2nd biggest revenue contributor) to post

moderate revenues vis-a-vis 3Q.

EBITDA 1,618 1,875 -13.7% 1,346 20.2%

EBIT 1,372 1,611 -14.8% 1,128 21.7%

PAT 1,068 1,308 -18.4% 930 14.9%

EPS 5.66 6.94 -18.4% 4.9 14.9% Key Things to Look For: Update on new facilities, Timelines for launch from Aleor JV,

Update on Elmiron approval timelines. EBITDA Margin 20% 22% -184 bps 18% 0 bps

Aurobindo 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 40,853 43,361 -5.8% 36,416 12.2% We are expectign decling owing to decline in gRenvela contribution following new

compeitition in it and no material approval during the quarter. ARV biz and ROW are

expected to grow at low double digits.

EBITDA 9,089 10,256 -11.4% 7,213 26.0%

EBIT 7,763 8,875 -12.5% 6,212 25.0%

PAT 5,516 5,950 -7.3% 5,325 3.6%

EPS 9.42 10.16 -7.3% 9.1 3.6% Key Things to Look For: Commentary on Unit IV form-483



April 9, 2018 of 54

Cadila 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 33,319 32,596 2.2% 24,782 34.4% we are expecting moderate growth sequentially owing to decline in gLialda marketshare

which will be partially offset by gTamiflu, which is expected to have done well on the

back of strong flu season.

EBITDA 8,561 8,412 1.8% 4,636 84.7%

EBIT 7,348 6,939 5.9% 3,491 110.5%

PAT 5,865 5,433 7.9% 3,855 52.1%

EPS 5.73 5.31 7.9% 3.8 52.2% Key Things to Look For: Outlook on gLialda compeition, Launch plans of gToprol Xl.


Cipla 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 39,554 39,138 1.1% 34,870 13.4% We are expecting Sequential decline as bunched up domestic sales in 3Q will taper-off

during the quarter; however, it will be partialy compensated by gTamiflu and full

quarter contribution from gViread, gPulmicort.

EBITDA 8,068 8,187 -1.4% 5,062 59.4%

EBIT 4,568 2,963 54.2% (1,260) -462.7%

PAT 3,791 4,035 -6.0% (618) -713.5%

EPS 4.71 5.03 -6.2% (0.8) -712.3% Key Things to Look For: Commentary on Goa Form-483, Timelines for gNasonex approval,

update on per quarter 1 complex generic launch. EBITDA Margin 20% 21% -52 bps 15% 0 bps

Dr Reddy 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 36,652 38,373 -4.5% 35,542 3.1% We are expecting sequential decline owing to additional competition in gVytorin, and

inventory channels normalizing following fill-up in the last quarter. EBITDA 6,968 8,000 -12.9% 5,834 19.4%

EBIT 4,013 5,009 -19.9% 2,630 52.6%

PAT 3,447 3,344 3.1% 3,125 10.3%

EPS 20.79 20.17 3.1% 18.8 10.3% Key Things to Look For: Resolution timelines for warning letter, update on Duvvada re-

inspection, Commentary on Srikakulam API unit. EBITDA Margin 19% 21% -184 bps 16% 0 bps

Granules 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 4,180 4,107 1.8% 3,553 17.7%

Sequnetial growth would be mainly led by ramp-up in newly comissioned Paracetamol

and Metformin facility. While, yoy gross margins are expected to see dip owing to

increase in raw material prices which will have cascading impact on EBITDA and PAT.

EBITDA 765 740 3.4% 774 -1.1%

EBIT 560 544 2.8% 594 -5.7%

PAT 429 350 22.4% 457 -6.2%

EPS 1.69 1.38 22.4% 2.0 -15.4% Key Things to Look For: Commentary on new US approvals, Number of filing done in US in

4Q. EBITDA Margin 18% 18% 28 bps 22% 0 bps


April 9, 2018 of 54

IPCA Labs 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 8,313 8,592 -3.2% 6,658 24.9% We are expecting sequtial decline largely because 3Q is usually strong for the domestic

market. So domestic revenues may decline, while rest geographies Anti-malarial

institutional business and US are expected to remain flat.

EBITDA 1,426 1,612 -11.5% 677 110.7%

EBIT 940 1,174 -19.9% 249 277.8%

PAT 808 1,056 -23.5% 444 82.0%

EPS 6.40 8.37 -23.5% 3.5 82.0% Key Things to Look For: Resolution timelines for warning letter, update on Institutional

business allocation. EBITDA Margin 17% 19% -161 bps 10% 699 bps

Lupin 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 39,365 39,756 -1.0% 42,533 -7.4% Expecting sequentially sales to be flat, as seasonally 3Q domestic business is stronger

than 4Q, which will be largely offset by launch of high value gTamiflu and gAxiron in the

US market.

EBITDA 6,989 6,883 1.5% 7,814 -10.5%

EBIT 4,189 4,080 2.7% 5,140 -18.5%

PAT 2,853 2,217 28.7% 3,802 -25.0%

EPS 6.33 4.92 28.7% 8.4 -25.0% Key Things to Look For: Resolution timelines for the warning letter, Update on

levothyroxine TAD. EBITDA Margin 18% 17% 44 bps 18% 0 bps

Natco Pharma 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 7,369 5,622 31.1% 5,778 27.5% We are expecting strong growth which will be led by strong contribution from gTamiflu

(stron flu season), pick up in market share of gDoxil and gCopaxone. EBITDA 4,042 2,865 41.1% 2,411 67.7%

EBIT 3,844 2,693 42.8% 2,276 68.9%

PAT 3,052 2,174 40.4% 1,764 73.0%

EPS 16.56 12.48 32.7% 10.1 63.5% Key Things to Look For: Contribution from gCopaxone, Commentary on future complex

launches. EBITDA Margin 55% 51% 390 bps 42% 0 bps


April 9, 2018 of 54

Sun Pharma 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 66,873 66,532 0.5% 71,370 -6.3%

We are expecting yoy decline owing to the dearth of new approvals, pressure in Taro

revenues, India and ROW are expected to maintain its growth momentum of mid-teens. EBITDA 13,824 14,534 -4.9% 15,475 -10.7%

EBIT 10,316 11,141 -7.4% 12,093 -14.7%

PAT 8,042 3,653 120.1% 12,237 -34.3%

EPS 3.03 1.52 98.9% 5.1 -40.6% Key Things to Look For: Commentary on Halol resolution, Tildra launch plans, and

commentary other Specialty products performance EBITDA Margin 21% 22% -117 bps 22% 0 bps

RPG Life Science 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 835 957 -12.7% 719 16.3% Yoy growth would be mainly led by lower base in 4QFY17, while sequnetially we are

exapecting a decline owing to bunched up exports in 3QFY18, which won't repeat his

quarter and strong growth in domestic, which should normalize during the quarter.

EBITDA 94 120 -21.5% 50 88.0%

EBIT 60 84 -28.5% 16 283.4%

PAT 50 54.5 -8.4% (2) -2477.5%

EPS 3.02 3.30 -8.4% (0.1) - Key Things to Look For: Commentary on new US approvals, Number of filing done in US in

4Q. EBITDA Margin 11% 13% -127 bps 7% 0 bps

Torrent Pharma 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 17,460 14,770 18.2% 14,340 21.8% Sequential growth would be led by full qurter integration of Unichem acquisition, Brazil

is expected to continue its growth momentum, while US would be flat owing to dearth of

new launches.

EBITDA 3,912 3,590 9.0% 2,950 32.6%

EBIT 2,940 2,650 10.9% 1,980 48.5%

PAT 2,199 580 279.1% 2,060 6.7%

EPS 13 3.43 279.1% 12.1 7.2% Key Things to Look For: Update on Oncology block, Commentary on Unichem integration.



April 9, 2018 of 54

Power Generation & Transmission

Outlook

India has a total installed capacity of 334GW as of Feb'18 vs. 315GW as of Feb'17.

Renewables capacities as on Dec'17 stood at 60GW which have improved sharply in

past two years led by addition in Solar and Wind capacities. Going ahead, revival in

capex, demand pick up and long term bids will be the key factors to watch out for.

Orders have improved on transmission and railways electrification front and we

expect fruther pick up going ahead pushed by schemes like UDAY, DDUGJY, IPDS,

Housing for All, and Saubhagya etc. Overall, we expect the capital utilization and

asset sweating to improve going ahead with Government's policies push in the power

sector. We continue to believe in strong balance sheets with efficient assets.

Top Picks: KEC International

JSW Energy 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 20,917 19,932 4.9% 18,621 12.3% Higher imported coal prices, lower demand and lower PLFs to lead to hit profitablity in

4QFY18E. We remain cautious on the company due to uncertainities related to unrelated

diversification and subdued power demand.

EBITDA 4,731 5,853 -19.2% 5,869 -19.4%

EBIT 2,324 3,446 -32.6% 3,490 -33.4%

PAT (170) 1,927 -108.8% 2,002 -108.5%

EPS (0.1) 0.4 -123.6% 0.1 -175.3% Key Things to Look For: Merchant Tariffs, Outlook on PPAs


KEC International 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 33,974 24,049 41.3% 25,967 30.8% We expect higher execution and EBITDAM expansion to lead to +31%/+33% yoy

revenues/PAT growth in 4QFY18E. Strong order book, improvement in EBITDAM and

reduction in interest cost to boost growth in FY19E. Segment wise order inflows and

EBITDAM will be key things to watch out for.

EBITDA 3,632 2,441 48.8% 2,686 35.2%

EBIT 3,232 2,170 49.0% 2,331 38.7%

PAT 1,755 1,118 57.0% 1,324 32.6%

EPS 6.8 4.3 57.0% 5.1 32.6% Key Things to Look For: Order inflows, EBITDAM



April 9, 2018 of 54

Media & Telecom

Outlook:

Media agencies suggest that the overall advertising environment remained

subdued in the months of January and February and some meaningful pick up in

advertising is expected in FY19. However, given the lower base of last year, we

estimate mid-single digit advertising growth for print companies and low double

digit growth for the radio companies.

Overall, FY19 is expected to be good for media companies helped by upcoming

state elections and soft comps of last year. Newsprint costs will be the key thing

to watch out for as it may put pressure on margins of print companies. Jagran

Prakashan is our preferred pick in media given its superior Radio business and

digital strategy.

Top Picks: Jagran Prakashan

DB Corp 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,611 5,986 -6.3% 5,171 8.5% We estimate 9% yoy growth in print advertising in 4QFY18 as we expect advertisement

growth to bounce back on a very low base (-3% yoy in 4QFY17). As per last analyst call,

real estate category has been coming back while lifestyle and education categories are

showing good grwoth. Circulation growth and radio growth are estimated at 5% and 10%

y-o-y respectively.

EBITDA 1,439 1,396 3.1% 1,122 28.2%

EBIT 1,209 1,163 4.0% 904 33.7%

PAT 832 781 6.5% 642 29.6%

EPS 4.51 4.22 6.9% 3.55 27.1% Key Things to Look For: 1) Any share buyback announcement by the company, 2) Rise in

newsprint prices EBITDA Margin 26% 23% 234 bps 22% 395 bps

HMVL 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 2,404 2,302 4.5% 2,343 2.6% We estimate 8% yoy growth in advertising as FMCG, retail, BFSI etc sectors have picked

up the pace. We project circulation revenues to decline by 13% yoy as it would suffer in

Bihar due to continued aggression by DB Corp and cover price realization in UP will take

some time to recover to original levels.

EBITDA 626 583 7.4% 573 9.3%

EBIT 576 536 7.5% 522 10.2%

PAT 445 493 -9.7% 424 5.0%

EPS 6.04 6.69 -9.7% 5.77 4.6% Key Things to Look For: 1) Sustainability of operating margins post cost cutting exercise

2) Any announcement on dividends/buybacks or acquisitions. EBITDA Margin 26% 25% 71 bps 24% 160 bps


April 9, 2018 of 54

HT Media 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 5,995 6,254 -4.1% 5,853 2.4% HT Media's English print business is expected to remain under pressure; we are

estimating 4% yoy growth in advertising revenues due to a very weak base (-21% yoy in

4QFY17). We estimate circulation revenues of English print business to grow by 11% yoy

again due to low base (earlier Company started closing down non-profitable editions

from 4QFY17 onwards).

EBITDA 1,115 1,347 -17.2% 731 52.6%

EBIT 789 1,040 -24.2% 394 100.0%

PAT 505 1,244 -59.4% 256 97.7%

EPS 2.19 4.04 -45.8% 1.10 99.2% Key Things to Look For: 1) Trend in newsprint prices 2) Any recovery in English

advertising revenues 3) Performance of radio business EBITDA Margin 19% 22% -293 bps 12% 612 bps

Jagran Prakashan 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,048 5,981 1.1% 5,620 7.6% We estimate 8% yoy growth in standalone print advertising in 4QFY18, as revival has

been seen in discretionary, BFSI, real estate and education related advertisements. We

expect circulation revenues to remain flat as recovery in cover prices would take some

time; management has indicated that cover price realization has bottomed out.

EBITDA 1,683 1,629 3.3% 1,441 16.8%

EBIT 1,344 1,286 4.5% 1,090 23.3%

PAT 875 848 3.2% 811 7.8%

EPS 2.81 2.80 0.3% 2.48 13.3% Key Things to Look For: 1) Any recovery in cover prices 2) Performance of the radio

subsidiary EBITDA Margin 28% 27% 60 bps 26% 220 bps

Music Broadcast 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 759 762 -0.4% 666 14.1% We estimate 14% top line growth for Radio City given that real estate, BFSI, durables,

auto etc are showing traction post DeMo and GST hiccups. We expect EBITDAM to

improve sequentially as marketing spends for new stations are over and operating

leverage shall come into play.

EBITDA 240 233 3.0% 166 44.7%

EBIT 174 168 3.6% 110 58.5%

PAT 129 119 8.4% 45 186.1%

EPS 2.26 2.08 8.5% 0.96 135.1% Key Things to Look For: 1) Utilization levels for newly launched stations 2) Pricing trends

in the legacy markets. EBITDA Margin 32% 31% 104 bps 25% 671 bps

Prime Focus 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 6,967 6,096 14.3% 6,537 6.6% We estimates 4QFY18 revenues to grow by ~7% (on a very high base of 4QFY17) yoy

driven by strong execution in creative services business. On the margin front, we expect

EBITDAM to improve by ~350bps on qoq basis as outsourcing to India increases. Last

quarter margins were subdued due to one-off items.

EBITDA 1,701 1,273 33.6% 1,790 -5.0%

EBIT 934 516 81.2% 1,288 -27.4%

PAT 279 (87) NA 396 -29.6%

EPS 0.93 (0.29) NA 1.32 -29.6% Key Things to Look For: 1) Order book expansion in both creative services and tech

businesses, 2) Any new client wins in Tech business, 3) Update on debt repayment and

warrants conversion EBITDA Margin 24% 21% 352 bps 27% -296 bps


April 9, 2018 of 54

Sterlite Technologies 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 8,385 8,352 0.4% 7,005 19.7% We project 4QFY18 revenues to grow by 20% driven by firm optical prices (newly

negotiated prices will come into effect from Jan'18) and higher utilization of Optic Fibre

Cable (OFC) capacity. We expect product and services revenue break-up to remain

stable at ~80:20.

EBITDA 2,031 2,017 0.7% 1,624 25.0%

EBIT 1,578 1,569 0.6% 1,180 33.8%

PAT 901 901 0.0% 637 41.5%

EPS 2.25 2.25 0.0% 1.59 41.5% Key Things to Look For: 1) Order book expansion in the services business, 2) Capacity

utilization in OFC business EBITDA Margin 24% 24% 7 bps 23% 103 bps


April 9, 2018 of 54

Textiles

Arvind Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 27,426 27,058 1.4% 24,648 11.3% Textile likely to report weak margin on higher cotton price. B&R will have mid-teen

growth and better margin on weak base. EBITDA 2,638 2,484 6.2% 2,306 14.4%

EBIT 1,848 1,551 19.1% 1,479 24.9%

PAT 1,081 890 21.4% 1,047 3.3%

EPS 4.2 3.4 21.4% 4.1 3.3% Key Things to Look For: Outlook on textile and Brand & retail margin; Consumer

sentiments EBITDA Margin 10% 9% 44 bps 9% 26 bps

Kewal Kiran Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 1,796 944 90.3% 1,214 47.9%

Strong growth on continous inventory restocking post GST and weak base quarter. EBITDA 399 157 153.4% 311 28.1%

EBIT 384 142 169.8% 298 28.9%

PAT 270 104 160.6% 238 13.5%

EPS 21.90 8.41 160.6% 19.29 13.5% Key Things to Look For: Volume growth outlook and improvement in customer sentiment


Mayur Uniquoters 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 1,387 1,380 0.5% 1,205 15.1% We estimate revenues to grow by ~15% in 4QFY18 helped by softer comps and recovery in

the footwear segment and export sales. We expect EBITDAM to come under some

pressure as prices of key raw materials - plasticizer and yarn – are on an upward trend.

EBITDA 340 361 -5.7% 285 19.4%

EBIT 296 317 -6.6% 244 21.5%

PAT 213 218 -2.0% 187 14.1%

EPS 4.7 4.8 -2.0% 4.1 14.1% Key Things to Look For: 1) Recovery in the footwear segment and 2) Updates on

construction of PU plant and PVC Mysore plant EBITDA Margin 25% 26% -162 bps 24% 88 bps

SP Apparels Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 1,621 1,629 -0.5% 1,581 2.6% Garment revenue expected to remain flat yoy while retail revenues to grow at a strong

rate of 32% yoy. Margins to be impacted by higher cotton prices and lower other income EBITDA 258 301 -14.5% 260 -0.9%

EBIT 201 243 -17.4% 206 -2.6%

PAT 142 137 3.6% 161 -11.6%

EPS 5.65 5.46 3.6% 6.40 -11.6% Key Things to Look For: Revenue growth from new and existing customers, retail revenue

growth EBITDA Margin 16% 18% -260 bps 16% -56 bps


April 9, 2018 of 54

Others

Gujarat Ambuja Exports 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales(Rs.) 12,656 10,134 24.9% 10,628 19.1% We estimate GAEX's revenues to grow by 19% yoy in 4QFY18 (+21%/+11% for agro

processing/maize processing segments). The margins are estimated to improve by

~235bps yoy driven by better profitability in agro processing segment on account of

higher utilization of crushing capacity.

EBIDTA 1,138 1,074 5.9% 705 61.4%

EBIT 915 881 3.9% 515 77.6%

PAT 625 632 -1.1% 337 85.7%

EPS 5.5 5.5 -1.1% 2.9 85.7% Key Things to Look For: 1) Operationalization of new maize processing unit, 2) Capacity

utilization level in agro processing segment EBITDA Margin 9% 11% -161 bps 7% 236 bps

Navneet Q4FY18E Q3FY18 QoQ (%) Q4FY17 YoY (%) Comments & Outlook

Net Sales 2,394 1,744 37.3% 2,090 14.6% Publication revenue to grow at ~7% yoy on weak 9MFY18 while stationery to grow at 20%

yoy led by strong order flow from exports and revival in domestic demand. Higher paper

prices to impact margins to some extent.

EBITDA 365 205 78.3% 290 25.6%

EBIT 300 143 109.5% 227 32.3%

PAT 209 119 76.2% 169 23.9%

EPS 0.9 0.5 76.2% 0.7 26.5% Key Things to Look For: FY19 growth guidance for publications & stationery segment and

IB performance. EBITDA Margin 15% 12% 351 bps 14% 134 bps

NESCO 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 807 806 0.1% 776 3.9% On the back of challenging business environment for Exhibition business, we expect

operational performance to remain muted during the quarter. EBITDA 596 585 1.8% 417 42.7%

EBIT 567 556 1.9% 393 44.3%

PAT 445 438 1.6% 345 29.1%

EPS 6.3 6.2 1.6% 4.9 29.1% Key Things to Look For: Outlook on Exhibition business (booking status), update on IT

Park 4 EBITDA Margin 74% 73% 126 bps 54% 2008 bps

PC Jewellers 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 23,410 26,449 -11.5% 21,554 8.6% We expect muted sales growth during the quarter on the back of lesser number of stores

opened on franchisee model. However, PCJ could register strong growth in profitability

on the back of favorable product mix and control over pricing.

EBITDA 2,442 2,689 -9.2% 1,769 38.1%

EBIT 2,375 2,636 -9.9% 1,710 38.9%

PAT 1,381 1,627 -15.1% 1,101 25.5%

EPS 3.5 4.1 -15.1% 2.8 25.5% Key Things to Look For: Outlook on franchisee model; demand environment

EBITDA Margin 10.4% 10.2% 27 bps 8.2% 223 bps


April 9, 2018 of 54

QuessCorp 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 21,117 15,840 33.3% 11,221 88.2% Revenues could increase 88.2% yoy and 34.4% qoq to Rs. 21,117 mn led by organic

growth; 2 month incremental contribution of Tata Business Services and ~1month

contribution of Monster. Together they could contribute Rs. 1400 mn while delay in

consolidation of Terrier could create Rs. 2800mn revenue shortfall. EBITDA margins

could expand 103bps qoq to 6.8% driven by integration of higher margins businesses.

EBITDA 1,430 909 57.2% 586 143.8%

EBIT 1,345 787 70.9% 521 158.2%

PAT 933 690 35.3% 280 233.5%

EPS 6.4 5.0 28.7% 2.2 190.7% Key Things to Look For: FY19e growth/margin and individual segmental outlook. Terrier

consolidation timelines. EBITDA Margin 6.8% 5.7% 103 bps 5.2% 154 bps

Teamlease 4QFY18E 3QFY18 QoQ (%) 4QFY17 YoY (%) Comments & Outlook

Net Sales 9,647 9,181 5.1% 8,169 18.1% Revenues could increase 18.1% yoy and 5.1% qoq as transitioning associates of a large

win turn billable in 4Q. EBITDA margins could be flat qoq at 1.9% led by integration of

higher margin businesses.

EBITDA 205 179 14.4% 147 38.9%

EBIT 183 155 18.1% 135 35.8%

PAT 217 184 18.1% 386 -43.7%

EPS 12.7 10.8 18.1% 22.6 -43.7% Key Things to Look For: FY19e revenue, ebitda margin trajectory. Market share gains in

large customers. EBITDA Margin 2.1% 1.9% 17 1.8% 32


April 9, 2018 of 54

Equirus Securities

Research Analysts Sector/Industry Email

Equity Sales E-mail

Abhishek Shindadkar IT Services [email protected] 91-22-43320643 Vishad Turakhia [email protected] 91-22-43320633

Ashutosh Tiwari Auto, Metals & Mining [email protected] 91-79-61909517 Subham Sinha [email protected] 91-22-43320631

Depesh Kashyap Mid-Caps [email protected] 91-79-61909528 Viral Desai [email protected] 91-22-43320635

Dhaval Dama FMCG, Mid-Caps [email protected] 91-79-61909518 Viraj Mehta [email protected] 91-22-43320634

Manoj Gori Consumer Durables [email protected] 91-79-61909523 Rushabh Shah [email protected] 91-22-43320632

Maulik Patel Oil and Gas [email protected] 91-79-61909519 Dealing Room E-mail

Pranav Mehta Building Materials [email protected] 91-79-61909514 Ashish Shah [email protected] 91-22-43320662

Praful Bohra Pharmaceuticals [email protected] 91-22-43320611 IleshSavla [email protected] 91-22-43320666

Rohan Mandora Banking & Financial Services [email protected] 91-79-61909529 Manoj Kejriwal [email protected] 91-22-43320663

Associates E-mail Dharmesh Mehta [email protected] 91-22-43320661

Ankit Choudhary [email protected] 91-79-61909533 Sandip Amrutiya [email protected] 91-22-43320660

Bharat Celly [email protected] 91-79-61909524 Compliance Officer E-mail

Harshit Patel [email protected] 91-79-61909522 Jay Soni [email protected] 91-79-61909561

Hetal Bhatia [email protected] 91-79-61909532 Corporate Communications E-mail

Meet Chande [email protected] 91-79-61909513 Mahdokht Bharda [email protected] 91-22-43320647 Nishant Bagrecha [email protected] 91-79-61909526

Parva Soni [email protected] 91-79-61909521

Ronak Soni [email protected] 91-79-61909525

Samkit Shah [email protected] 91-79-61909520

Shreepal Doshi [email protected] 91-79-61909541

Varun Baxi [email protected] 91-79-61909527

Vikas Jain [email protected] 91-79-61909531

Rating & Coverage Definitions: Absolute Rating • LONG : Over the investment horizon, ATR >= Ke for companies with Free Float market cap >Rs 5 billion and ATR >= 20% for rest of the companies • ADD: ATR >= 5% but less than Ke over investment horizon • REDUCE: ATR >= negative 10% but <5% over investment horizon • SHORT: ATR < negative 10% over investment horizon Relative Rating • OVERWEIGHT: Likely to outperform the benchmark by at least 5% over investment horizon • BENCHMARK: likely to perform in line with the benchmark • UNDERWEIGHT: likely to under-perform the benchmark by at least 5% over investment horizon Investment Horizon Investment Horizon is set at a minimum 3 months to maximum 18 months with target date falling on last day of a calendar quarter. Lite vs. Regular Coverage vs. Spot Coverage We aim to keep our rating and estimates updated at least once a quarter for Regular Coverage stocks. Generally, we would have access to the company and we would maintain detailed financial model for Regular coverage companies. We intend to publish updates on Lite coverage stocks only an opportunistic basis and subject to our ability to contact the management. Our rating and estimates for Lite coverage stocks may not be current. Spot coverage is meant for one-off coverage of a specific company and in such cases, earnings forecast and target price are optional. Spot coverage is meant to stimulate discussion rather than provide a research opinion.

Registered Office:

Equirus Securities Private Limited

Unit No. 1201, 12th Floor, C Wing, Marathon Futurex,

N M Joshi Marg, Lower Parel,

Mumbai-400013.

Tel. No: +91 – (0)22 – 4332 0600

Fax No: +91- (0)22 – 4332 0601

Corporate Office:

3rd floor, House No. 9,

Magnet Corporate Park, Near Zydus Hospital, B/H Intas Sola Bridge,

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Tel. No: +91 (0)79 - 6190 9550

Fax No: +91 (0)79 – 6190 9560

mailto:[email protected]




























April 9, 2018 of 54

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