Motilal Oswal Financial Services

Info Edge

12 November 2020

2QFY21 Results Update | Sector: Technology

Info Edge

Estimate change

TP change

Rating change

Bloomberg

Equity Shares (m)

M.Cap.(INRb)/(USDb)

52-Week Range (INR)

1, 6, 12 Rel. Per (%)

12M Avg Val (INR M)

Financials & Valuations (INR b)

Y/E Mar

2020 2021E

Sales

12.7

11.0

EBITDA

4.0

2.9

PAT

2.1

2.6

EPS (INR)

16.7

20.3

EPS Gr. (%)

BV/Sh. (INR)

Ratios

RoE (%)

RoCE (%)

Payout (%)

Valuations

P/E (x)

P/BV (x)

-27.1

199.5

13.8

13.9

42.4

212.3

17.8

21.4

344.3

7.5

53.8

174.9

10.3

INFOE IN

104

455.7 / 6.1

3784 / 1580

-5/0/30



1366

CMP: INR3,544



TP: INR3,550 (+0%)

Neutral

Aggressive marketing spends drag down op. performance

Info Edge (INFOE) reported billings decline in 1Q due to COVID-19, which

was reflected in 19% YoY revenue de-growth in 2Q (due to the subscription-

based model of the business). Continued MoM improvement (after the

trough of May’20) in billings is in line with our assumption of a gradual

increase in revenues going forward.

Margins in 2Q were dragged down by aggressive marketing spends in

Jeevansathi/99acres. Management indicates the current run-rate of

advertisement spends would continue as the company aims to increase its

market share in the matrimony portal. Nevertheless, we still estimate a

gradual increase in margins going forward, led by positive operating

leverage.

While losses from investee companies reduced by 50% YoY to INR966m, this

is still an increase from breakeven levels in the previous quarter. This was

largely attributable to some normalization in unit economics at Zomato.

Traffic/Billings on INFOE’s operating portals increased sequentially. Revenue

should follow a similar trend going forward.

Given the company’s market positioning, multi-dimensional growth may be

expected across its core businesses in the medium-to-long term. We expect

long-term growth trends to play out at its operating entities, whose margins

continue to inch up on high operating leverage. Furthermore, led by an

inclination for profitability in investee companies, we expect consolidated

losses to be curtailed over time.

We value its operating entities using DCF, with WACC of 11% and terminal

growth rate of 5%. Our SOTP valuation indicates Target Price of INR3,550.

Maintain

Neutral.

2022E

13.5

3.9

3.4

26.3

29.7

356.2

7.5

54.5

134.8

10.0



Shareholding pattern (%)

As On

Promoter

DII

FII

Others

Sep-20

38.5

12.8

39.3

9.4

Jun-20

40.4

12.6

37.2

9.9

Sep-19

40.6

14.1

34.8

10.6



FII Includes depository receipts

Standalone revenue below estimate; drag in margins led by higher

advertisement expenses



Total billings stood at INR 2.5b, implying an increase of 32% sequentially and

decline of 20% YoY.

Standalone revenue was INR2.56b (-8.6% QoQ and -19.1% YoY) – a 9% miss

on our estimate of INR2.8b.

Revenue de-growth was attributable to 19% decline in the Recruitment

segment and 36% decline in the Real Estate segment. This was partially

offset by a 12% YoY increase in other businesses (Jeevansathi and Shiksha).

Naukri’s PBT margin declined 5pp sequentially. The PBT margin for 99acres

stood at -29% (v/s breakeven achieved in 1QFY21). The PBT margins of other

businesses (Jeevansathi and Shiksha) stood at -93% (v/s -36% in the previous

quarter).

The overall EBIT margin was 15.8% (-17.5pp QoQ and -12.4pp YoY), 12pp

below our estimate of 27.8% – due to sluggish revenues and higher ad

expenses.

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.

Research Analyst: Anmol Garg

(Anmol.Garg@MotilalOswal.com)

Mukul Garg – Research analyst

(Mukul.Garg@MotilalOswal.com) /

Heenal Gada – Research analyst

(Heenal.Gada@MotilalOswal.com)

12 November 2020

Info Edge



Advertisement and promotional expenses stood at 20% of revenues (v/s 9% in

1QFY21). Employee cost increased 5% QoQ and was flat YoY (in line with our

estimates).

PAT was INR511.5m (-39% YoY and down 38.5% QoQ), largely led by lower

operational income, partially offset by lower ETR (22% v/s 24% in 2QFY20).

2Q net loss in investee companies stood at INR965.9m (v/s profit of INR33m in

1Q). Losses reduced by almost 50% YoY, led by a lower burn in Zomato.

Management commentary highlights



Recruitment:

While Naukri’s billings declined 20% YoY, it has seen improvement

with each month post-May’20. Traffic is now back at pre-COVID levels. Gradual

recovery has been seen in the job market, led by resilient verticals such as IT and

Pharma. The drag is led by verticals such as Hospitality and Travel. The Naukri

Job Seek index has seen continued improvement from May’20; however, it was

still down 23% at end-Sep’20.

99acres:

99acres’ revenue declined 36% YoY. Operating loss at –INR72m, led by

lower revenues and higher advertisement spends. New home launches, which

constitute around ~23% of revenues, have seen muted activity as a higher

preference for ready-to-move houses has been seen among buyers.

Jeevansathi:

INFOE would deploy the majority of its marketing dollars toward

aggressively advertising for Jeevansathi. The company’s new features, such as

video/voice calling and ‘Milan Samaroh’, are seeing good response.

Zomato:

Zomato’s revenue run-rate is now near pre-COVID levels. This is largely

attributable to higher order value. Order volumes are yet to recover to similar

levels (impacted by restaurant closures on account of COVID lockdown).

Zomato’s burn has reduced significantly and is within an attractive unit

economics range.

Cash:

The company’s total cash balance post-QIP and 2QFY21 stands at INR3.3b.

Talks on potential M&As are yet to materialize. INFOE would continue to

evaluate options in the areas of Recruitment, Matrimony, and Education.

Valuation and view



For FY21, we expect 13% revenue decline, largely driven by a 44% drop in

billings for 1QFY21. While 1QFY21 resulted in unprecedented billings decline, it

has shown an improving trend in 2QFY21. With the expectation of more jobs

coming in (on pent-up demand) and pressure on real estate developers to sell

off inventory, we expect 22% revenue growth for FY22E.

Our expectation of a 250bp margin reduction over FY20–22E is attributable to

higher advertisement expenses in Jeevansathi.

With the company investing prudently (clocked an XIRR >35%), some of its

current investments would scale up in the medium-to-long term, further

contributing to the group’s valuations.

We have individually valued INFOE’s group entities using a DCF-based valuation

(WACC: 11%; terminal growth rate: 5%). Our SOTP Target Price stands at

INR3,550/share.

Maintain Neutral.

12 November 2020

Info Edge

Quarterly Performance (Standalone)

Y/E March

Revenues

3,128

YoY (%)

20.5

Salary costs

1,298

Ad and Promotion costs

549

Other Expenses

272

EBITDA

1,010

EBITDA Margin (%)

32.3

Depreciation

EBIT Margin (%)

29.1

Other Income

245

PBT bef. Extra-ordinary

1,139

Provision for Tax

390

ETR (%)

34.2

PAT bef. Minority

667

EOI

-82

Adjusted PAT

749

QoQ (%)

-10.6

YoY (%)

-5.1

EPS (INR)

5.4

E: MOFSL Estimates

Key Perfor. Indicators

Y/E March

FY20

3,166

19.5

1,349

514

310

993

31.4

101

28.2

232

1,107

266

24.0

-749

842

12.4

7.8

0.8

3,205

14.0

1,357

498

291

1,059

33.0

104

29.8

204

1,143

232

20.3

880

-30

911

8.2

22.5

7.2

3,228

10.3

1,392

484

387

965

29.9

110

26.5

195

1,034

246

23.8

416

-372

788

-13.4

-5.9

3.4

2,801

-10.4

1,297

256

203

1,046

37.3

111

33.4

203

1,122

290

25.8

832

5.6

11.1

6.8

FY21E

3QE

2,561 2,747

-19.1

-14.3

1,363 1,409

502

494

181

209

516

634

20.1

23.1

110

112

15.8

19.0

263

654

770

142

193

21.8

25.0

512

578

512

578

-38.5

13.0

-39.2

-36.5

4.0

4.5

FY20

FY21E

4QE

2,918 12,727 11,027

-9.6

15.9

-13.4

1,441 5,396 5,510

525 2,044 1,777

216 1,260

809

736 4,027 2,931

25.2

31.6

26.6

114

414

447

21.3

28.4

22.5

267

876

995

874 4,423 3,420

218 1,133

843

25.0

25.6

24.6

655 2,057 2,577

0 -1,233

655 3,290 2,577

13.4

-16.8

4.4

-21.7

5.1

16.7

20.3

Est.

2QFY21

2,807

-11.3

1,369

337

209

893

31.8

113

27.8

250

1,015

254

25.0

761

-8.6

-9.6

5.9

(INR m)

Var.

(% / bp)

-8.8

-780bp

-0.4

48.9

-13.3

-42.2

-1170bp

-2.8

-1190bp

5.0

-35.5

-43.8

-320bp

-32.8

FY20

4,507

38376

1,280

19%

26%

13%

4,590

38853

1,396

13%

15%

21%

4,698

38752

1,318

11%

25%

4,562

41584

642

-9%

-34%

13%

FY21E

4,478

37004

1,109

-19%

-35%

14%

3QE

4378

38484

1,153

-15%

-30%

15%

4QE

4478

39639

1,199

-10%

-23%

15%

FY20

FY21E

Operating metrics

Headcount

Naukri - Revenue per unique customer

99acres - Listing (k)

Revenue (YoY %)

Recruitment

99acres

Jeevansathi

4,407

37844

1,273

19%

35%

4,698

91429

5,267

15%

19%

17%

4478

89862

4,104

-13%

-30%

14%

Management commentary highlights

Recruitment



Operating performance:

Naukri’s revenue declined 19% YoY, while EBITDA

margins increased by 280bp YoY. According to SimilarWeb, traffic share for the

platform remains above 90%. Naukri’s billings declined 20% YoY during the

quarter. Billings have improved with each month post-May’20. Traffic is now

back at pre-COVID levels.

Gradual recovery in job market:

Gradual recovery has been seen in the job

market, led by resilient verticals such as IT and Pharma. The drag is led by

verticals such as Hospitality and Travel. The Naukri Job Seek index has seen

continued improvement from May’20; however, it was still down 23% at end-

Sep’20.

Additional services:

Naukri has been working toward making technological

improvements to its platform. Additionally, the company has been working on

various initiatives, such as: 1) the enterprise version of Resdex, 2) a re-hiring

service portal, 3) a separate platform for premium engineering jobs – Hirist, and

12 November 2020

Info Edge

4) an ultra-premium job market with personalized services – Bigshyft. However,

it would take some time before these new initiatives could significantly

contribute to revenue.

Real Estate



Operating performance:

99acres’ revenue declined 36% YoY. Operating loss at –

INR72m, led by lower revenues and higher advertisement spends. While paid

listings almost doubled sequentially, they were still down 12% YoY. 99acres

continues to lead the market in this space.

Underperformance led by slower activity in new launches:

New home

launches, which constitute around ~23% of revenues, have seen muted activity

as a higher preference for ready-to-move houses has been seen among buyers.

Traffic:

Traffic is almost back at pre-COVID levels. While there is traction from

the buyer side, the supplier side still faces issues. 99acres is seeing higher supply

from owner listings; broker listings are yet to recover.

Matrimony



Operating performance:

Unlike Naukri and 99acres, Jeevansathi’s revenue

increased by 14% YoY. However, at the same time, EBITDA loss doubled to

INR333m. Billings for Jeevansathi were up 19% YoY.

Advertising spend:

INFOE would deploy the majority of its marketing dollars

toward aggressively advertising for Jeevansathi. The company’s new features,

such as video/voice calling and ‘Milan Samaroh’, are seeing good response.

Market share:

Jeevansathi ranks third in the Matrimony segment. Overall

market share is less than 15%. Traffic share is higher in the north and west

regions of India (~25%), while it is insignificant in south India (majorly

dominated by Matrimony.com).

Others



Zomato:

Zomato’s revenue run-rate is now near pre-COVID levels. This is largely

attributable to higher order value. Order volumes are yet to recover to similar

levels (impacted by restaurant closures on account of COVID lockdown).

Zomato’s burn has reduced significantly and is within an attractive unit

economics range.

Cash:

The company’s total cash balance post-QIP and 2QFY21 stands at INR3.3b.

Talks on potential M&As are yet to materialize. INFOE would continue to

evaluate options in the areas of Recruitment, Matrimony, and Education.

Other investee companies:

Apart from Zomato and Policybazaar, ShoeKonnect,

ShopKirana, and Gramophone have been doing well. However, any potential

exit would take some time as these companies are not yet of scale to go for an

IPO.

12 November 2020

Info Edge

Exhibit 1: Overall/Recruitment billing shows sequential improvement, however still down by -17/20% YoY

INFOE Billings ( INR M)

YoY

Naukri Billings ( INR M)

Growth (YoY)

Source: Company, MOFSL

Exhibit 2: Strong recovery in billings of 99acres

99 acres Billings ( INR M)

Growth (YoY)

Exhibit 3: Jeevansathi billings up 18%

JS and Siksha Billings ( INR M)

297

228

Growth (YoY)

356 372 343 355

344 362

318 324 265 295

302

274

Source: MOFSL, Company

Exhibit 4: Billings decline to translate to negative growth for FY21

Revenue (INR B)

17%

20%

14%

Growth YoY

23%

16%

13%

11.0

-13%

7.1

8.0

9.2

11.0

12.7

13.5

Source: Company, MOFSL

12 November 2020

Info Edge

Exhibit 5: Investee companies at ~36% premium to book value recorded by INFOE

Amt.

Invested

Company

Zomato Media Pvt Ltd.

Etechaces Marketing and Consulting Pvt Ltd.

Happily Unmarried Marketing Pvt Ltd.

NoPaperForms Solutions Pvt.Ltd.

International Educational Gateway Pvt. Ltd

Agstack Technologies Private Limited

Bizcrum Infotech Pvt. Ltd.

Medcords Healthcare Solutions Pvt. Ltd.

Printo Document Services Pvt. Ltd.

Shop Kirana E Trading Private Ltd

Greytip Software Private Limited

Metis Eduventures Private Limited (Adda_24*7)

Terralytics Analysis Private Limited (Teal)

LQ Global Services Private Limited

Llama Logisol Private Limited (Shipsy)

Sunrise Mentors Private Limited (Coding Ninja)

Qyuki Digital Media Private Limited

Dotpe Private Limited

Intellihealth Solution Pvt Ltd

Fanbuff Esports India Pvt Limited

Rusk Media Pvt Limited

(INR m)

1522

5758

323

337

205

204

160

250

604

350

280

371

250

104

480

~ Actual

Holding

(%)

22.71

15.85

42.33

48.1

37.9

33.21

32.85

22.4

25.12

25.36

20.25

16.97

16.67

5.36

7.48

17.8

Valuation as

per last

funding round

INR m

247500

112500

2200

1000

541

614

735

1050

929

3750

1728

1650

266

500

1554

4928

1463

208

175

350

2696

INFOE

Value

INR m

56207

17831

931

481

205

204

241

235

233

951

350

280

53.25

388

264

109

240

Description

Bulbul Shopping Network Pte Ltd

Exhibit 6: SOTP TP – INR3,550

Info Edge (India)

Segment

Methodology

Food Tech

Insurance Broker

Specialized E Commerce

School Operations

Education Consultation

Farming Solutions

B2B marketplace for footwear’s

Teleconsultation

Print Solutions

B2B E-Tailing

SaaS-based HR and Payroll Software

Online Education

Real Estate Analytics

Online legal search engine

SaaS-based Logistics platform

Online Education

Digital Content strategy

QR payment service

Tele consultation

Gaming

Digital media services

Video Shopping App

Source: MOFSL, Company, VCC Edge

Methodology description

We have taken an assumption of 16% revenue CAGR

and 18% EBIT CAGR over FY20–34. Our WACC and

Terminal growth estimates stand at 11% and 5%,

respectively.

We forecast an 8% CAGR in total absorption for the next

15 years, coupled with a 4% CAGR in weighted average

price; this implies a 12% CAGR for the sector. Based on

assumptions of long-term average of 7% market share for

99acres in real estate marketing expenditure, we

estimate an 18% revenue CAGR over FY20–34. Our WACC

and Terminal growth estimates stand at 11% and 5%,

respectively.

We estimate a 34% CAGR in GMVs, 26% CAGR in the

number of orders, and a consistent take rate of 21%

over FY20–34. Our WACC and Terminal growth

estimates stand at 11% and 5%, respectively. INFOE

holds 22.7% in Zomato.

Valuation towards

INFOE (INR b)

259.4

Contribution

(INR per share)

2011

Naukri

DCF

99acres.com

DCF

47.6

369

Zomato.com

DCF

69.4

538

Policybazaar.com

Jeevansathi.com

Other Businesses

Other investee

companies

Cash On books

Total

33% premium to

valuation ascribed in the Factoring in a USD2b valuation

latest round of funding

We expect near-term consolidation in the Online

Matrimony industry. We estimate an 18% revenue CAGR

DCF

over FY20–34 and increase margins to 30% in FY34 from -

78% in FY20. Our WACC and Terminal growth estimates

stand at 11% and 5%, respectively.

Multiples

7x One-year forward sales

40% premium to the

investment value

24.0

186

14.1

109

4.5

6.0

33.3

258

3550

12 November 2020

Info Edge

Exhibit 7: Revisions to our estimates

Standalone business

Revenue (INR m)

YoY (%)

EBITDA (%)

EBIT (%)

EPS (INR)

FY20

12.7

15.9

31.6

28.4

16.7

Revised

FY21E

11.0

-13.4

26.6

22.5

20.3

FY22E

13.5

22.6

29.1

25.6

26.3

FY20

12.7

15.9

31.6

28.4

16.7

Earlier

FY21E

11.6

(9.2)

32.9

28.9

24.9

FY22E

13.9

19.8

32.6

29.1

29.5

FY20

0.0

0bp

0.0

Change (% / bp)

FY21E

FY22E

-4.6

-2.4

-420bp

280bp

-630bp

-350bp

-640bp

-350bp

-18.6

-10.8

Source: MOFSL, Company

Valuation and view

Direct, high-quality play on exploding e-commerce opportunity



India’s E-Commerce industry is expected to grow to USD100b by 2025 from the

current size of USD30b. As per Google, the Classifieds segment is expected to

grow at a CAGR of 18%, with Jobs, Real Estate, and Matrimony constituting two-

thirds of the market.

As GDP growth revives in India, it would directly benefit INFOE’s Recruitment

segment growth, which has had a 7–8pp historical multiplier effect for every

1pp uptick in GDP growth. Naukri.com’s traffic share is almost 70%.

Reducing industry burn vindicates prudent investment strategy



The scenario in venture capital funding appears to have changed over the last

few months, with companies making a pivot toward monetization and

profitability. This would imply that the worst in terms of month-on-month burn

is behind.

We believe this plays into INFOE’s strategy of staying put to protect its market

leadership in multiple franchises, such as Zomato; it could now look forward to

deriving the financial rewards from its investments sooner rather than later.

Revival of GDP growth to help flagship Recruitment segment



Naukri.com should directly and disproportionately benefit from the uptick in

GDP growth. This should be compounded by a pickup in demand for IT

resources. We expect near-term pain in the segment on account of lower

collections in 1HFY21. However, V-shaped recovery in billings is likely on the

assumption that GDP would revive in FY22 (given that IT sector hiring persists).

Disciplined management action drives confidence



Backing strong teams:

Despite buying significant stake in investee companies,

the approach has been to back its teams and get involved as and when guidance

is sought.

Prioritizing:

INFOE has been quick to write-off its book investments where

either scale visibility dwindled and/or the company’s focus changed (INR2.2b to

date).

Robust cash balance



INFOE has a strong liquidity position of INR33b. Given the fixed commitments of

INR6b in FY20, the company has adequate liquidity to sustain operations for 2.5

years. Additionally, the book value of start-up investments amounts to INR11b

12 November 2020

Info Edge



on the balance sheet. INFOE’s start-up investments have been highly successful

in the past.

According to our estimate, the company has clocked an XIRR of >35% since it

first started investing. Management indicated that some of the investee

companies, such as ShopKirana and ShoeKonnect, could gain sustainable

momentum over the medium-to-long term.

Valuation and view



For FY21, we expect 13% revenue decline, largely driven by a 44% drop in

billings for 1QFY21. While 1QFY21 resulted in unprecedented billings decline, it

has shown an improvement trend in 2QFY21. With the expectation of more jobs

coming in (on pent-up demand) and pressure on real estate developers to sell

off inventory, we expect 22% revenue growth for FY22E.

Our expectation of a 250bp margin reduction over FY20–22E is attributable to

higher advertisement expenses in Jeevansathi.

With the company investing prudently (clocked an XIRR >35%), some of its

current investments would scale up in the medium-to-long term, further

contributing to the group’s valuations.

We have individually valued INFOE’s group entities using a DCF-based valuation

(WACC: 11%; terminal growth rate: 5%). Our SOTP Target Price stands at

INR3,550/share. Maintain Neutral.

12 November 2020

Info Edge

Financials and valuations

Income Statement

Y/E Mar

Sales

Change (%)

Employee expense

Advertising cost

Other expense

EBITDA

% of Net Sales

Depreciation

Interest

Other Income

PBT

Tax

Rate (%)

Adjusted PAT

Extraordinary Items

Reported PAT

Change (%)

2015

6,116

20.9

2,520

842

931

1,822

29.8

173

764

2,383

736

30.9

1,647

292

1,939

50.9

2015

1,202

15,422

16,624

2.8

16,627

1,635

700

935

5,578

12,907

8,973

3,007

155

673

2,794

2,341

452

10,114

16,627

2016

7,123

16.5

3,247

1,318

1,137

1,421

20.0

210

721

1,932

539

27.9

1,393

-160

1,233

-36.4

2016

1,209

16,431

17,640

60.2

17,700

1,901

881

1,020

7,405

12,152

357

118

9,522

347

1,808

2,877

2,448

429

9,275

17,700

2017

8,021

12.6

3,752

881

1,114

2,275

28.4

241

625

2,659

575

21.6

2,084

-40

2,044

65.7

2017

1,211

18,620

19,831

52.3

19,883

1,723

1,121

602

8,371

15,188

2,162

11,280

247

1,424

4,278

3,862

416

10,910

19,883

2018

9,155

14.1

3,931

1,164

1,088

2,973

32.5

215

971

3,728

991

26.6

2,737

-913

1,824

-10.8

2018

1,216

19,859

21,074

44.0

21,118

1,866

1,337

529

10,720

15,028

11,456

1,458

2,070

5,159

4,703

456

9,869

21,118

2019

10,983

20.0

4,586

1,757

1,226

3,413

31.1

204

1,112

4,320

1,169

27.1

3,152

-334

2,818

54.5

2019

1,220

22,019

23,239

46.0

23,285

2,109

1,540

569

12,857

15,984

3,400

1,052

11,472

6,125

5,628

496

9,860

23,285

2020

12,727

15.9

5,396

2,044

1,260

4,027

31.6

414

876

4,423

1,133

25.6

3,290

-1,233

2,057

-27.0

2020

1,223

23,094

24,317

568.7

24,885

3,279

1,954

1,325

16,404

13,381

2,554

4,275

6,482

6,225

5,676

549

7,156

24,885

2021E

11,027

-13.4

5,510

1,777

809

2,931

26.6

447

995

3,420

843

24.6

2,577

25.3

2021E

1,284

43,113

44,397

486.9

44,884

3,502

2,401

1,100

16,110

33,771

2,554

15,711

15,425

6,098

5,414

684

27,673

44,884

(INR m)

2022E

13,521

22.6

5,797

2,434

1,351

3,940

29.1

474

1,121

4,528

1,132

25.0

3,396

31.8

Balance Sheet

Y/E Mar

Share Capital

Reserves

Net Worth

Loans

Capital Employed

Gross Block

Less : Depreciation

Net Block

CWIP

Investments

Curr. Assets

Current Investments

Debtors

Cash

Loans & Advances

Other Current Assets

Current Liab. & Prov

Current Liabilities

Provisions

Net Current Assets

Application of Funds

(INR m)

2022E

1,284

44,660

45,943

486.9

46,430

3,822

2,875

946

16,110

36,809

2,554

102

15,006

19,147

7,435

6,751

684

29,373

46,430

12 November 2020

Info Edge

Financials and valuations

Ratios

Y/E March

Basic (INR)

EPS

Cash EPS

Book Value

DPS

Payout (%)

Valuation (x)

P/E

Cash P/E

EV/EBITDA

EV/Sales

Price/Book Value

Dividend Yield (%)

Profitability Ratios (%)

RoE

RoCE

RoIC

Turnover Ratios

Debtors (Days)

Fixed Asset Turnover (x)

Cash Flow Statement

Y/E March

CF from Operations

Cash for Working Capital

Net Operating CF

Net Purchase of FA

Free Cash Flow

Net Purchase of Invest.

Net Cash from Invest.

Proceeds from Equity

Proceeds from LTB/STB

Dividend Payments

Cash Flow from Fin.

Net Cash Flow

Opening Cash Bal.

Add: Net Cash

Closing Cash Bal.

E: MOFSL Estimates

2015

16.5

13.0

138.3

3.0

31.2

215.3

272.2

266.3

68.4

25.7

0.1

11.5

13.8

-112.9

6.5

2016

10.0

14.0

188.0

4.3

44.2

353.6

254.0

279.8

44.4

18.9

0.1

6.4

8.1

-338.4

7.0

2017

15.4

17.4

162.7

3.0

23.2

230.7

204.1

199.5

51.5

21.8

0.1

10.0

11.1

-210.6

13.3

2018

14.9

24.2

172.9

5.5

29.3

238.6

146.5

141.4

45.9

20.5

0.2

13.4

-91.1

17.3

2019

23.0

27.5

190.7

5.5

25.6

154.7

128.9

122.7

38.1

18.6

0.2

14.2

135.3

19.3

2020

16.7

30.4

199.5

9.6

42.4

212.3

116.8

102.3

32.4

17.8

0.3

13.8

13.9

70.5

9.6

2021E

20.3

23.4

344.3

9.0

53.8

174.9

151.4

145.4

38.6

10.3

0.3

7.5

30.8

10.0

2022E

26.3

30.0

356.2

12.0

54.5

134.8

118.3

108.3

31.6

10.0

0.3

7.5

22.3

14.3

2015

1,968

1,970

-2,151

-181

-6,279

-8,430

7,497

-4

-337

7,156

696

2,311

696

3,007

2016

809

6,706

7,515

-1,620

5,895

1,320

-300

-726

-701

6,514

3,007

6,514

9,522

2017

1,653

630

2,283

-1,970

314

1,864

-106

-1

-437

-419

1,759

9,522

1,759

11,280

2018

1,901

1,166

3,067

-4,158

-1,091

-7,973

-12,132

-1

-803

-757

-9,822

11,280

-9,822

1,458

2019

2,097

860

2,956

-2,276

680

8,718

6,442

-808

-781

8,618

1,458

-405

1,053

2020

1,735

752

2,487

-9,039

-6,552

5,245

-3,794

-204

-1,176

-1,377

-2,684

1,053

3,222

4,275

2021E

21,323

-9,062

12,261

-223

12,038

845

622

-60

-1,387

-1,447

11,436

4,275

11,436

15,710

2022E

2,808

-2,405

402

-320

1,121

801

-58

-1,850

-1,908

-705

15,710

-705

15,005

12 November 2020

Info Edge

Explanation of Investment Rating

Investment Rating

Expected return (over 12-month)

BUY

>=15%

SELL

< - 10%

NEUTRAL

< - 10 % to 15%

UNDER REVIEW

Rating may undergo a change

NOT RATED

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

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

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

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

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

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

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

12 November 2020

Info Edge

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

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

- 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.

12 November 2020