Motilal Oswal Financial Services

5 November 2019

2QFY20 Results Update | Sector: Cement

Prism Johnson

Buy

BSE SENSEX

40,248

Bloomberg

Equity Shares (m)

M.Cap.(INRb)/(USDb)

52-Week Range (INR)

1, 6, 12 Rel. Per (%)

12M Avg Val (INR M)

Free float (%)

S&P CNX

11,917

PRSMJ IN

503

39.3 / 0.6

104 / 62

-8/-17/-28

25.1

CMP: INR78



TP: INR100 (+28%)

Significant miss led by higher costs

Cement profitability increases 4% YoY:

2QFY20 revenues declined 2% YoY

to INR13.1b (in line with est.). Cement and clinker volume growth declined

~6% YoY due to heavy monsoons and overall economic slowdown. Cement

division’s EBITDA/t (+4% YoY) was lower than expected at INR615 (v/s est.

INR967/t) due to higher costs.

TBK and RMC report EBIT loss:

TBK’s revenue remained flat YoY at INR4.1b,

while segment volumes increased 1% YoY. TBK’s EBIT loss came in at

INR103m in 2QFY20 (v/s loss of INR63m in 2QFY19). 2QFY20 RMC sales

stood at INR3.5b (+2% YoY); RMC EBIT loss came in at INR45m (v/s EBIT of

INR18m in 2QFY19) due to lower utilization levels during the quarter.

EBITDA increased 3% YoY (-55% QoQ) to INR826m (v/s est. INR1.4b), with

margin at 6.3% (+0.3pp YoY; -6pp QoQ). Company reported net loss of

INR88m (v/s est. INR308m profit), as against INR70m profit in 2QFY19.

Key highlights from management presentation:

(1) The Board has decided

to simplify the corporate structure by merging a few subsidiaries into

standalone, subject to necessary approvals. (2) Prism has commissioned

7.5MW of solar power capacity. Work in progress in case of 22.5MWWHRS

is on schedule and commissioning is expected by Jun’20

1HFY20 Performance:

Sales/EBITDA/PAT increased 0%/ 2%/-26% YoY. We

expect sales/EBITDA/PAT for 2HFY20 to increase 6%/ 1%/-14%. Operating

cash flow in 1HFY20 turned to -INR251m (v/s INR3.3b for 1HFY19) due to

higher working capital, which increased on account of higher inventory 6

days, receivables of 2 days and decline in payables by 7days.

Valuation and view:

We have reduced our EBITDA estimate for FY20/FY21

by 10%/5% to build in higher costs from the current quarter. As a result, our

PAT estimate for FY20 has reduced by 36% (also due to higher depreciation

and interest from current quarter). Our SOTP value for PRSMJ is

INR100/share. We value the cement business at 7x FY21 EV/EBITDA; RMC at

6x FY21 EV/EBITDA and TBK business at 1x FY21 EV/Sales. Maintain

Buy.

Financials & Valuations (INR b)

2019 2020E

Y/E Mar

Net Sales

EBITDA

PAT

EPS (INR)

Gr. (%)

BV/Sh (INR)

RoE (%)

RoCE (%)

P/E (x)

P/BV (x)

59.6

5.5

1.6

3.1

123.4

22.7

14.5

11.6

25.0

3.4

61.4

5.6

1.2

2.3

-26.3

24.4

9.8

10.6

33.9

3.2



2021E

65.9

6.3

1.4

2.9

24.9

26.7

11.3

27.1

2.9



Estimate change

TP change

Rating change



Amit Murarka - Research analyst

(Amit.Murarka@motilaloswal.com); +91 22 7199 2309

Pradnya Ganar - Research analyst

(Pradnya.Ganar@motilaloswal.com); +91 22 6129 1537

Investors are advised to refer through important disclosures made at the last page of the Research Report.

Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Prism Johnson

Quarterly Perf. (Standalone)

Y/E March

Sales Dispatches (m ton)

YoY Change (%)

Realization (INR/ton)

YoY Change (%)

QoQ Change (%)

Net Sales

YoY Change (%)

Total Expenditure

EBITDA

Margins (%)

Depreciation

Interest

Other Income

PBT before EO expense

Extra-Ord expense

PBT after EO Expense

Tax

Rate (%)

Reported PAT

Adj PAT

Margins (%)

FY19

1.67

1.35

1.50

13.0

20.0

9.6

4,380 4,355 4,391

-5.2

10.6

5.1

-3.2

-0.6

0.8

14,977 13,353 14,398

13.1

14.6

10.3

13,168 12,550 13,308

1,809

803 1,090

12.1

6.0

7.6

376

385

400

448

436

437

121

1,017

315

31.0

702

4.7

103

31.9

0.5

277

31.4

190

1.3

FY20

3QE

4QE

1.75

1.56

1.27

1.52

1.80

4.8

-6.8

-5.5

1.0

2.7

4,545 4,669 4,501 4,471 4,457

0.5

6.6

3.4

1.8

-1.9

3.5

2.7

-3.6

-0.7

-0.3

16,828 15,077 13,142 15,057 18,128

4.3

0.7

-1.6

4.6

7.7

14,983 13,226 12,316 13,829 16,386

1,845 1,851

826 1,229 1,742

11.0

12.3

6.3

8.2

9.6

440

459

477

480

500

421

467

515

510

657

1,016

113

903

406

44.9

497

610

3.6

1,022

366

35.8

656

4.3

-140

-52

37.2

-88

-0.7

274

35.0

178

1.2

628

214

34.1

414

2.3

FY19

6.27

11.2

4,423

1.7

59,556

10.5

54,008

5,547

9.3

1,601

1,741

207

2,413

113

2,301

841

36.5

1,460

1,573

2.6

FY20E

6.14

-2.0

4,523

2.3

61,404

3.1

55,756

5,648

9.2

1,916

2,149

201

1,783

624

35.0

1,159

1.9

(INR M)

FY20

2QE

1.28

-5.0

4559

4.7

-2.4

13,606

1.9

12,235

1,371

10.1

460

467

474

166

35.0

308

2.3

-129

-131

-129

Var

(%)

-1

-3

-40

-38

-11

Exhibit 1: RMC revenues increased 2% YoY in 2QFY20

RMC Revenues (INR m)

1.8

3.6 3.2

-1.1

-0.1

2.7

-2.0

-1.1

1.4

2.9 2.8

PBIT Margin (%)

0.5 0.1 1.1 0.2

Exhibit 2: TBK revenues remained flat YoY in 2QFY20

TBK Revenues (INR m)

-1.3 -1.6

-1.3

-1.2 -1.1

-4.1 -4.0

-6.7

-4.7 -5.2

2.0

PBIT Margin (%)

-2.3 -1.5 -2.0 -1.4 -1.7 -2.5

Source: Company, MOFSL

Exhibit 3: EBITDA trend

EBITDA (INR m)

6.3

7.6

2.8

2.7

EBITDA Margins (%)

8.5

10.5

5.9

7.0

3.5

12.1

6.0

7.6

11.0

12.3

6.3

4.5

Source: Company, MOFSL

5 November 2019

Prism Johnson

Key highlights from management presentation

Cement



Overall cost increased, mainly due to raw material and other costs; better

realizations led to improvement in EBITDA.

During 1HFY20, 7.5MW of solar power was commissioned. It also plans to

commission a total of 25MW during the year.

Work for 22.5MWWHRS is on schedule; commissioning is expected by Jun’20.

During the quarter, tiles volume grew 1% YoY. Net working capital management

continues to remain under control.

Division continues to invest in marketing and distribution activities. Total of 13

Experience Centers are in operations.

To simplify the corporate structure, the Board has decided to undertake

composite scheme of arrangement and amalgamation amongst the Company,

H. & R. Johnson (India) TBK Ltd (HRJTBK), Milano Bathroom Fittings Pvt Ltd,

Silica Ceramica Pvt Ltd being 100% subsidiaries and TBK Rangoli Tile Bath

Kitchen Pvt Ltd, TBK Venkataramiah Tile Bath Kitchen Pvt Ltd, TBK Samiyaz Tile

Bath Kitchen Pvt Ltd being wholly-owned subsidiaries of HRJ TBK, subject to

necessary approvals. Balance capacity and additional 10MW solar capacity will

be commissioned during the year.

H & R Johnson (Tiles)



Consolidated HRJ EBITDA margins were at ~4.2% v/s ~1.8%, reflecting

EBITDA growth of ~151%. Consolidated HRJ revenues increased ~8% YoY,

led by

sanitaryware and faucets revenues increasing ~14%.

Ready-mix concrete business’ performance was impacted due to heavy

monsoons and tight liquidity.

Focus continues on improving utilization levels and increase in value-added

products in the Individual Housing Segment.

Ready-mix Concrete



Valuation and views

We have reduced our EBITDA estimate for FY20/FY21 by 10%/5% to build in higher

costs from the current quarter. As a result, our PAT estimate for FY20 has reduced

by 36% (also due to higher depreciation and interest from current quarter). Our

SOTP value for PRSMJ is INR100/share. We value the cement business at 7x FY21

EV/EBITDA; RMC at 6x FY21 EV/EBITDA and TBK business at 1x FY21 EV/Sales.

Maintain

Buy.

Exhibit 4: Revision in estimates

(INR b)

Volumes (mt)

Net Sales

EBITDA

Net Profit

EPS (INR)

Rev

6.1

61.4

5.6

1.2

2.3

FY20E

Old

6.1

61.5

6.3

1.8

3.6

Chg (%)

1.0

-0.2

-10.1

-35.7

Rev

6.5

65.9

6.3

1.4

2.9

FY21E

Old

6.4

65.9

6.7

2.0

3.9

Chg (%)

1.0

0.0

-4.7

-25.9

Source: MOFSL, Company

5 November 2019

Prism Johnson

Financials and Valuations

Income Statement

Y/E March

Net Sales

Change (%)

Total Expenditure

% of Sales

EBITDA

Margin (%)

Depreciation

EBIT

Int. and Finance Charges

Other Income - Rec.

PBT bef. EO Exp.

EO Expense/(Income)

PBT after EO Exp.

Current Tax

Deferred Tax

Tax Rate (%)

Reported PAT

PAT Adj for EO items

Change (%)

Margin (%)

2014

49,443

4.3

48,244

97.6

1,199

2.4

1,766

-567

2,415

359

-2,623

-1,341

-1,283

-462

36.0

-821

-2,162

253.6

-4

2015

55,718

12.7

53,098

95.3

2,621

4.7

1,368

1,252

2,536

556

-729

-621

-108

-255

236.7

147

-474

-78.1

-1

2016

52,775

-5.3

50,341

95.4

2,434

4.6

1,560

874

2,400

1,343

-183

-219

-304

137.1

117

-124.7

2017

49,999

-5.3

47,385

94.8

2,614

5.2

1,602

1,012

1,834

1,103

281

120

-13

37.8

175

49.3

2018

53,889

7.8

50,292

93.3

3,596

6.7

1,531

2,066

1,873

858

1,051

270

33.0

704

302.1

2019

59,556

10.5

54,008

90.7

5,547

9.3

1,601

3,947

1,741

207

2,413

113

2,301

532

309

36.5

1,460

1,573

123.4

2020E

61,404

3.1

55,756

90.8

5,648

9.2

1,916

3,732

2,149

201

1,783

624

35.0

1,159

-26.3

(INR m)

2021E

65,912

7.3

59,566

90.4

6,346

9.6

2,146

4,200

2,193

221

2,228

780

35.0

1,448

24.9

Balance Sheet

Y/E March

Equity Share Capital

Total Reserves

Net Worth

Deferred Liabilities

Total Loans

Capital Employed

Gross Block

Less: Accum. Deprn.

Net Fixed Assets

Capital WIP

Total Investments

Curr. Assets, Loans&Adv.

Inventory

Account Receivables

Cash and Bank Balance

Loans and Advances

Curr. Liability & Prov.

Account Payables

Provisions

Net Current Assets

Appl. of Funds

E: MOSL Estimates

2014

5,034

5,047

10,081

452

18,333

28,866

34,553

13,607

20,946

626

5,746

14,083

4,622

5,258

525

3,679

12,535

12,130

405

1,548

28,866

2015

5,034

4,658

9,691

136

18,828

28,655

35,418

14,935

20,483

688

5,569

16,028

5,500

5,574

1,081

3,873

14,113

13,648

465

1,915

28,655

2016

5,034

4,371

9,405

-363

18,524

27,566

22,526

2,092

20,433

683

5,698

15,752

4,717

6,087

1,152

3,797

15,000

14,285

715

752

27,566

2017

5,034

4,523

9,557

-639

16,308

25,225

23,585

3,693

19,892

945

6,730

12,698

3,997

6,055

667

1,979

15,039

14,518

521

-2,342

25,225

2018

5,034

5,225

10,258

-564

12,426

22,121

25,353

5,224

20,129

925

6,877

13,534

4,315

6,621

587

2,011

19,345

18,733

612

-5,811

22,120

2019

5,034

6,388

11,421

-250

11,532

22,703

27,170

6,825

20,345

1,202

7,772

14,804

5,012

7,046

555

2,192

21,419

20,863

557

-6,615

22,703

2020E

5,034

7,252

12,286

-250

13,032

25,068

30,272

8,741

21,531

1,400

7,772

15,882

5,167

7,570

884

2,260

21,516

21,510

-5,634

25,068

(INR m)

2021E

5,034

8,406

13,440

-250

12,032

25,222

34,672

10,887

23,785

300

7,772

16,463

5,547

8,126

364

2,426

23,097

23,089

-6,634

25,222

5 November 2019

Prism Johnson

Financials and Valuations

Ratios

Y/E March

Basic (INR)

EPS

Cash EPS

BV/Share

DPS

Payout (%)

Valuation (x)

P/E

Cash P/E

P/BV

EV/Sales

EV/EBITDA

EV/Ton (US$)

Dividend Yield (%)

Return Ratios (%)

RoIC

RoE

RoCE

Working Capital Ratios

Asset Turnover (x)

Inventory (Days)

Debtor (Days)

Leverage Ratio (x)

Current Ratio

Debt/Equity

2014

-4.3

-0.8

20.0

0.0

2015

-0.9

1.8

19.3

0.0

2016

0.2

3.3

18.7

0.0

2017

0.3

3.5

19.0

0.0

2018

1.4

4.4

20.4

0.5

41.8

2019

3.1

6.3

22.7

0.5

20.2

25.0

12.4

3.4

0.8

8.8

54.5

0.6

-1.6

-20.6

-0.5

1.7

34.8

36.6

1.1

1.8

-7.9

-4.8

-8.7

1.9

38.2

35.8

1.1

1.9

-1.6

1.2

-2.9

1.9

31.7

38.0

1.1

2.0

3.4

1.8

4.9

1.9

28.4

39.7

0.8

1.7

9.0

7.1

8.1

2.3

30.3

44.2

0.7

1.2

18.6

14.5

11.6

2.7

32.3

44.9

0.7

1.0

2020E

2.3

6.1

24.4

0.5

25.4

33.9

12.8

3.2

0.8

8.9

0.6

17.2

9.8

10.6

2.6

31.2

45.7

0.7

1.1

2021E

2.9

7.1

26.7

0.5

20.3

27.1

10.9

2.9

0.8

8.0

0.6

17.2

11.3

2.6

31.8

96.6

0.7

0.9

Cash Flow Statement

Y/E March

Oper. P/L before Tax

Interest/Dividends Recd.

Depreciation

Direct Taxes Paid

(Inc)/Dec in WC

CF from Operations

EO expense

CF from Operating incl EO

(inc)/dec in FA

Free Cash Flow

(Pur)/Sale of Investments

Others

CF from investments

(Inc)/Dec in Debt

Interest Paid

Dividend Paid

Others

CF from Fin. Activity

Inc/Dec of Cash

Add: Beginning Balance

Closing Balance

2014

-1,278

1,766

2,216

-35

-1,697

972

-1,119

-147

-1,684

-1,831

390

1,455

162

-2,330

2,465

135

149

375

524

2015

-108

1,368

2,273

-1,540

2,020

287

2,307

-1,548

759

681

511

-356

-2,087

693

-1,394

557

525

1,082

2016

-219

1,560

2,281

-17

451

4,057

-341

3,716

-1,869

1,848

745

-35

-1,158

-2,251

-237

-2,488

1,081

1,151

2017

281

1,602

1,768

-50

1,661

5,262

169

5,431

-1,253

4,178

-510

-187

-1,951

-1,759

-2,206

-3,965

-484

1,152

667

2018

1,051

1,531

1,810

-296

408

4,504

4,590

-1,732

2,857

-281

-16

-2,029

-5,508

-1,692

4,559

-2,641

-80

667

587

2019

2,301

1,601

1,681

-430

-446

4,706

273

4,979

-2,300

2,680

-234

-2,468

-7,065

-1,501

-303

6,326

-2,544

-33

587

554

2020E

1,783

1,916

2,149

-624

-651

4,574

-3,300

1,274

-3,300

1,500

-2,149

-294

-944

330

555

884

(INR m)

2021E

2,228

2,146

2,193

-780

480

6,267

-3,300

2,967

-3,300

-1,000

-2,193

-294

-3,488

-520

884

364

5 November 2019

Prism Johnson

Corporate profile

Company description

Prism Johnson is one of India’s leading integrated

Building Materials Company, with a wide range of

products from cement, ready-mixed concrete, tiles,

bath products to kitchens. The company has three

Divisions, viz. Prism Cement, H & R Johnson (India),

and RMC Readymix (India). Cement business has a

capacity of 7mt.

Source: MOFSL/Bloomberg

Exhibit 1: Sensex rebased

Exhibit 2: Shareholding pattern (%)

Sep-19

Promoter

DII

FII

Others

74.9

6.2

5.6

13.3

Jun-19

74.9

4.9

6.6

13.6

Sep-18

74.9

3.8

6.6

14.8

Exhibit 3: Top holders

Holder Name

Jupiter India Fund

L&T Mutual Fund Trustee Limited-L&T

Emerging Businesses Fund

Akash Bhanshali

Dsp Small Cap Fund

Hdfc Trustee Co Ltd A/C Hdfc Housing

Opportunitiesfund-1140d Nov-17 (1)

% Holding

2.4

1.8

1.5

1.2

Source: Capitaline

Note: FII Includes depository receipts

Source: Capitaline

Exhibit 4: Top management

Name

Shobhan M Thakore

Vijay Aggarwal

Atul R Desai

Joydeep Mukherjee

Sarat Kumar Chandak

Vivek Krishan Agnihotri

Aneeta S Kulkarni

Designation

Chairman & Independent Dir.

Managing Director

Executive Director & CEO

Company Secretary

Exhibit 5: Directors

Name

Rajan Raheja

Raveendra Chittoor

Name

Ameeta A Parpia

Source: Capitaline

*Independent

Exhibit 6: Auditors

Name

D C Dave & Co

G M Kapadia & Co

Savita Jyoti Associates

Type

Cost Auditor

Statutory

Secretarial Audit

Exhibit 7: MOFSL forecast v/s consensus

EPS

(INR)

FY20

FY21

MOFSL

forecast

2.3

2.9

Consensus

forecast

4.3

5.7

Variation

(%)

-46.7

-49.2

Source: Bloomberg

Source: Capitaline

5 November 2019

Prism Johnson

Explanation of Investment Rating

Investment Rating

BUY

SELL

NEUTRAL

UNDER REVIEW

NOT RATED

Expected return (over 12-month)

>=15%

< - 10%

< - 10 % to 15%

Rating may undergo a change

We have forward looking estimates for the stock but we refrain from assigning recommendation

*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within following 30

days take appropriate measures to make the recommendation consistent with the investment rating legend.

Disclosures

The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).

Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the Regulations,

is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial products. MOFSL is a subsidiary

company of Passionate Investment Management Pvt. Ltd.. (PIMPL). MOFSL is a listed public company, the details in respect of which are available on www.motilaloswal.com. MOFSL

(erstwhile Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a registered Trading Member with National Stock Exchange of

India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and National Commodity & Derivatives Exchange Limited (NCDEX) for its

stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member

of Association of Mutual Funds of India (AMFI) for distribution of financial products and Insurance Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance

products.

Details of associate entities of Motilal Oswal Financial Services Limited are available on the website at

http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf

MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and buy or sell

the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a

market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other potential conflict of

interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the specific recommendations made by the

analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even though there might exist an inherent conflict of interest in

some of the stocks mentioned in the research report

MOFSL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report should be aware

that MOFSL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific merchant banking,

investment banking or brokerage service transactions. Details of pending Enquiry Proceedings of Motilal Oswal Financial Services Limited are available on the website at

https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx

A graph of daily closing prices of securities is available at

www.nseindia.com, www.bseindia.com.

Research Analyst views on Subject Company may vary based on Fundamental research and

Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated from MOFSL research

activity and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.

Regional Disclosures (outside India)

This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use

would be contrary to law, regulation or which would subject MOFSL & its group companies to registration or licensing requirements within such jurisdictions.

For Hong Kong:

This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong Kong Securities

and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst Regulations) 2014 Motilal

Oswal Securities (SEBI Reg No. INH000000412) has an agreement with Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of research report in Hong Kong. This report

is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity to which this document relates is only available to

professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these securities, products and services in any jurisdiction where their offer

or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not located in Hong Kong & are not conducting Research Analysis in Hong Kong.

For U.S.

Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state

laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934

Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any brokerage and investment services provided by

MOFSL , including the products and services described herein are not available to or intended for U.S. persons. This report is intended for distribution only to "Major Institutional Investors" as

defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional investors"). This document must not be acted on or relied on

by persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major institutional investors and will be engaged in

only with major institutional investors. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and

interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOFSL has entered into a

chaperoning agreement with a U.S. registered broker-dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be

executed within the provisions of this chaperoning agreement.

The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered

broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading

securities held by a research analyst account.

For Singapore

In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets services

license and an exempt financial adviser in Singapore.As per the approved agreement under Paragraph 9 of Third Schedule of Securities and Futures Act (CAP 289) and Paragraph 11 of First

Schedule of Financial Advisors Act (CAP 110) provided to MOCMSPL by Monetary Authority of Singapore. Persons in Singapore should contact MOCMSPL in respect of any matter arising

from, or in connection with this report/publication/communication. This report is distributed solely to persons who qualify as “Institutional Investors”, of which some of whom may consist of

"accredited" institutional investors as defined in section 4A(1) of the Securities and Futures Act, Chapter 289 of Singapore (“the SFA”). Accordingly, if a Singapore person is not or ceases to be

such an institutional investor, such Singapore Person must immediately discontinue any use of this Report and inform MOCMSPL.

Specific Disclosures

1 MOSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.

2 MOSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company

3 MOSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months

4 MOSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report

5 Research Analyst has not served as director/officer/employee in the subject company

6 MOSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months

7 MOSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months

8 MOSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months

9 MOSL has not received any compensation or other benefits from third party in connection with the research report

10 MOSL has not engaged in market making activity for the subject company

********************************************************************************************************************************

The associates of MOFSL may have:

financial interest in the subject company

actual/beneficial ownership of 1% or more securities in the subject company

received compensation/other benefits from the subject company in the past 12 months

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Prism Johnson

other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the specific

recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even though there

might exist an inherent conflict of interest in some of the stocks mentioned in the research report.

acted as a manager or co-manager of public offering of securities of the subject company in past 12 months

be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies)

discussed herein or act as an advisor or lender/borrower to such company(ies)

received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.

The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report

Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not consider

demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from clients which are not

considered in above disclosures.

Analyst Certification

The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research

analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.

Terms & Conditions:

This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be

altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of MOFSL. The report is

based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in nature. The information is obtained from

publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty, representation of warranty, express or implied, is made

as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice. The report is prepared solely for informational purpose and does not

constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments for the clients. Though disseminated to all the customers

simultaneously, not all customers may receive this report at the same time. MOFSL will not treat recipients as customers by virtue of their receiving this report.

Disclaimer:

The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or

in whole, to any other person or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for informational purpose and may not be

used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Nothing in this report constitutes investment, legal,

accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The securities discussed and opinions expressed in this

report may not be suitable for all investors, who must make their own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This

may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this document should make such investigations as it deems necessary to arrive at

an independent evaluation of an investment in the securities of companies referred to in this document (including the merits and risks involved), and should consult its own advisors to

determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. Certain transactions -including those involving futures,

options, another derivative products as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied,

is made as to the accuracy, completeness or fairness of the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is

provided solely to enhance the transparency and should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The

Company reserves the right to make modifications and alternations to this statement as may be required from time to time without any prior approval. MOFSL, its associates, their directors and

the employees may from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform

or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a

separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of information that is

already available in publicly accessible media or developed through analysis of MOFSL. The views expressed are those of the analyst, and the Company may or may not subscribe to all the

views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or

published, copied, in whole or in part, for any purpose. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any

locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject MOFSL to any registration or

licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose

possession this document may come are required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or representatives shall be

liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of the information.

The person accessing this information specifically agrees to exempt MOFSL or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not

to hold MOFSL or any of its affiliates or employees responsible for any such misuse and further agrees to hold MOFSL or any of its affiliates or employees free and harmless from all losses,

costs, damages,

expenses that may be suffered by the person accessing this information due to any errors and delays.

Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263; Website

www.motilaloswal.com.CIN no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road, Malad(West), Mumbai-

400 064. Tel No: 022 7188 1000.

Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst: INH000000412. AMFI:

ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company Ltd. (MOAMC): PMS (Registration

No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth Management Ltd. (MOWML): PMS (Registration No.:

INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is a distributor of Mutual Funds, PMS, Fixed Deposit, Bond,

NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt. Ltd. which is a group company of MOFSL. Private Equity is offered

through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL. Research & Advisory services is backed by proper research. Please read the Risk

Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no assurance or guarantee of the returns. Investment in securities market is subject to market risk,

read all the related documents carefully before investing. Details of Compliance Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.

* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National Company Law

Tribunal, Mumbai Bench.

5 November 2019