11 February 2021
3QFY21 Results Update | Sector: Financials
Piramal Enterprises
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
PIEL IN
212
368.4 / 5
1676 / 608
4/-23/-21
2655
CMP: INR1,633
TP: INR2,170 (+33%)
Buy
Scaling down Wholesale Lending; Pharma segment stable
Financials & Valuations (INR b)
Y/E March
2020 2021E
Revenues
130.7
127.0
EBITDA
17.9
35.0
PAT
-5.5
27.0
EPS (INR)
-24.5
119.6
EPS Gr. (%)
NA
NA
BV/Sh. (INR)
1,274
1,507
Payout (%)
NA
35
Valuations
P/E (x)
NA
13.7
P/BV (x)
1.3
1.1
Div. Yield (%)
0.8
2.6
2022E
134.3
38.2
30.2
127.2
6
1,589
35
12.8
1.0
2.7
Shareholding pattern (%)
As On
Dec-20 Sep-20 Dec-19
PromoterPromoter 46.1
46.1
46.1
DIIDII
10.5
10.2
9.9
FIIFII
29.3
29.7
29.9
OthersOthers
14.1
14.1
14.2
FII Includes depository receipts
Piramal Enterprises (PIEL)’s consol. PAT increased 19% YoY to INR8b. The
Financial Services (FS) segment was characterized by a run-down in the
Wholesale Lending book, the rollout of the Retail segment, and marginal
asset quality deterioration.
The Complex Hospital Generics (CHG) business was volatile due to COVID in
3QFY21. On the other hand, the Contract Dev. and Manufacturing Org.
(CDMO; led by a strong order book) / India Consumer business (led by
increased demand for Self-Care and Baby Care products) has been steady.
As the Carlyle deal commenced in Oct’20, the consol. networth jumped from
INR315b to INR355b QoQ. The equity infusion was used to primarily pare
down debt – consol. net debt/equity ratio is at a multi-year low of 0.9x.
After a lackluster 1HFY21, the Real Estate segment rebounded in 3QFY21
across most large cities. We expect the company to remain cautious in
Wholesale Lending, with incremental disbursements to be largely driven by
the Retail segment.
We forecast a 12% loan book CAGR over FY21–23E.
The company has a provision buffer of 6.3% of loans, which is largely
adequate.
While the Dewan Housing Finance (DHFL) deal is value-accretive,
we await final regulatory approvals before incorporating it in our estimates.
Maintain Buy, with TP of INR2,170 (FY23E SOTP-based).
After three quarters of stable loans, the loan book declined 10% QoQ to
INR464b.
The GNPL ratio (proforma) increased 120bp QoQ due to the
slippage of one corporate account. Total BS provisions increased 40bp
QoQ to 6.3%. PIEL restructured 3.8% of loans in the quarter.
Cost of funds remains elevated at 10.8%, resulting in ~400bp spreads. We
believe this could improve as a) leverage in the Financial Services business is
down from 2.5x to 1.9x YoY and b) the asset quality picture is much clearer,
and total stress due to the pandemic is likely to be much lower than initially
feared.
The DHFL acquisition is another step toward BS ‘retailization’.
The total deal
consideration is INR342.5b, of which the upfront cash component is
INR147b (incl. cash on DHFL’s BS) and the deferred component (NCDs) is
INR195.5b.
PIEL launched its Retail Lending segment with six products in 3QFY21 –
Mass Housing Finance, Affordable Housing Finance, LAP, Secured Business
Financing, Digital Personal Loans, and Digital Purchase Finance (the last two
are via partnerships). Overall yield in this segment is 11.5–12%.
Pharma sales grew moderately by 5.6% YoY for 3QFY21. CDMO / India
Consumer products increased 16% YoY / 14% YoY, driving overall growth in
the Pharma segment.
This was partly offset by 13% YoY decline in the CHG segment.
FS – running down Wholesale Lending; INR343b DHFL deal
Pharma – outlook on improving track
Research Analyst: Alpesh Mehta
(Alpesh.Mehta@MotilalOswal.com);+91 22 6129 1526 |
Piran Engineer
(Piran.Engineer@MotilalOswal.com); +91 22 6129 1539
Nitin Aggarwal
(Nitin.Aggarwal@MotilalOswal.com); +91 22 6129 1542 |
Divya Maheshwari
(Divya.Maheshwari@motilaloswal.com); +91 22 6129 1540
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.
28 October 2020
1
 Motilal Oswal Financial Services
Piramal Enterprises
Slowdown in the CHG segment led to a 400bp YoY margin contraction in the
Pharma segment. Notably, the EBITDA margin has expanded 1000bp from
1QFY21 to date and is expected to improve further going forward.
Strong growth in the order book for the CDMO segment, the addition of new
contracts / revival of surgeries in the CHG segment, and sustained momentum in
the India Consumer product segment present better prospects for the overall
Pharma segment going forward.
It targets 50% share in Retail Lending (via inorganic expansion as well).
It did a one-time restructuring of INR17.41b (3.8% of loans) in 3QFY21. This was
done for four corporate accounts belonging to the Hospitality, Auto
Components, Infra, and Real Estate sectors. Just 1% of retail loans were
restructured.
With the non-compete clause being over with regard to the Abbott deal, PIEL
may look to re-enter the Domestic Formulation space, subject to a strategic mix
and the valuation of inorganic opportunities.
Highlights from management commentary
Valuation and view
Over the past 1–2 years, PIEL has curtailed disbursements in Wholesale Lending and
reduced exposure to its Top 10 clients by 25%+. In our view, this cautious stance is
likely to continue over the next few quarters too, while the company looks to ramp
up its Retail Lending business. While it is still early days, the initial asset quality
outcome post moratorium has been positive. As the economic scenario gets better,
asset quality is likely to improve – this would have a second-order impact on PIEL’s
availability and cost of debt capital as well. We raise our EV/EBITDA multiple for the
Pharma business to 16x (from 14x earlier), factoring in a strong order book in the
CDMO/CHG segment and improved profitability in the India Consumer product
segment. Using SOTP, we arrive at TP of
INR2,170
(FY23E-based). Maintain
Buy.
11 February 2021
2
 Motilal Oswal Financial Services
Piramal Enterprises
Quarterly Performance
Y/E March
1Q
Financial Services Business
Revenues (INR m)
Change QoQ (%)
Change YoY (%)
PBT (INR m)
Change QoQ (%)
Change YoY (%)
AUM (INR b)
Change QoQ (%)
Change YoY (%)
ROAs (Cal %)
Reported Leverage (D/E x)
ROEs (Cal %)
NIMs (% Cum Rep)
Yield on loans (% Cum Rep)
Cost of funds (% Cum Rep)
GNPA %
ECL %
Borrowing Mix (%)
Term Loans
NCDs
Securitisation
Others
Pharma Business
Revenues (INR m)
Change QoQ (%)
Change YoY (%)
EBITDA (INR m)
Change QoQ (%)
Change YoY (%)
Revenue Mix
Global
Domestic
Global EBITDA Margins
20,144
4.2
29.2
7,344
39.0
19.6
566
0.0
20.4
5.2
3.7
15.7
5.7
14.0
10.3
0.9
1.9
63.0
19.0
0.0
18.0
11,724
-20.6
10.0
2,427
-30.9
53.8
90.7
9.3
22.0
INR m
FY20
2Q
19,540
-3.0
12.8
7,355
0.1
13.9
531
-6.3
0.5
5.4
2.8
15.7
5.4
14.0
11.0
0.9
1.8
67.0
18.0
6.0
9.0
13,165
12.3
17.5
3,037
25.1
38.7
91.5
8.5
24.0
FY21
3Q
19,626
0.4
6.6
5,904
-19.7
-10.9
514
-3.1
-6.9
4.5
2.5
12.3
5.5
14.3
11.1
1.8
1.8
65.0
18.0
8.0
9.0
13,074
-0.7
13.0
4,124
35.8
63.1
91.3
8.7
23.0
4Q
17,184
-12.4
-11.1
-17,049
-388.8
-422.7
510
-0.9
-10.0
-13.3
2.3
-35.1
5.2
14.3
11.2
2.4
5.8
65.0
19.0
7.0
9.0
16,226
24.1
9.9
4,749
15.2
35.2
95.3
4.7
26.0
1Q
18,995
10.5
-5.7
6,261
-136.7
-14.7
513
0.6
-9.4
4.9
2.2
12.6
6.5
15.2
10.8
2.5
5.9
62.0
19.0
6.0
13.0
10,379
-36.0
-11.5
1,093
-77.0
-55.0
90.4
9.6
11.0
2Q
18,608
-2.0
-4.8
6,037
-3.6
-17.9
515
0.5
-2.9
4.7
2.1
11.6
6.3
14.8
10.8
2.5
5.9
48.0
38.0
4.0
10.0
14,411
38.9
9.5
2,897
165.0
-4.6
90.6
9.4
0.0
3Q
17,950
-3.5
-8.5
6,842
13.3
15.9
464
-10.0
-9.8
0.0
1.9
0.0
6.2
14.6
10.8
3.7
6.3
50.0
39.0
3.0
8.0
13,741
-4.6
5.1
2,914
0.6
-29.3
90.5
9.5
0.0
Highlights from management commentary
Wholesale Lending
It targets 50% share in Retail Lending in the near term.
It has launched six retail lending products thus far and would launch one
product every month.
Do not foresee any equity capital raise for the next 3–5 years in the FS business.
The Infra book is down from the peak of INR45b to INR23.75b currently.
Exposure to Lodha is down from the peak of INR33b to INR26.71b currently. This
could decline to INR25b by end-FY21. Also, the exposure would be bifurcated
into INR10b of Lodha exposure and the balance to an SPV, comprising ready
inventory.
Omkar – there was exposure to counterparties in JDAs.
Cost of funds should decline with a higher share of retail lending.
Retail Lending
Personal and purchase loans are at an experimental stage right now. This
experimentation is being carried out in urban markets with first-time jobbers
with incomes of INR25–50k.
11 February 2021
3
 Motilal Oswal Financial Services
Piramal Enterprises
It went live with a partnership with Zest Money in 3QFY21. Three more fintech
partnerships are lined up in 4QFY21. PIEL keeps the float economics, while the
partner provides the risk cover. In short, the partner manages the front-end and
PIEL the back-end.
Yield: Small business loans – 13%, LAP – 12%, Mass housing finance – 10.5%,
Affordable housing finance – 11.5–12%
There is INR53b worth of retail loans currently.
Asset quality
It did a one-time restructuring of INR17.41b (3.8% of loans) in 3QFY21. This was
done for four corporate accounts belonging to the Hospitality, Auto
Components, Infra, and Real Estate sectors. Just 1% of retail loans were
restructured.
It is confident that balance sheet provisions are adequate to meet any future
contingencies.
The DCCO extension was done for 10–12% of the lending book in the first
quarter of FY21.
Stage 2 + Stage 3 loans are up 5% QoQ.
Auto anc. exposure of INR4.36b slipped into NPL in 3Q. PIEL preferred to initiate
recovery proceedings by liquidating company assets rather than restructuring it.
DHFL-related
The management is examining the Wholesale book, but cannot comment on
upside in the same.
The Retail book stands at INR280–290b – do not expect any significant
markdown on the same at the time of the merger. It would look to cross-sell
other retail lending products from the DHFL branch network. For about half the
branches, business could resume once the acquisition happens. There was
meaningful attrition a year ago, but this has now reduced.
It would issue 10-year NCDs to DHFL creditors at 6.95%.
Expect RBI approval within 10 days, followed by NCLT filing. The process is
expected to fully close in June.
Pharma business
With significant new contracts in place and the gradual revival of surgeries in
key markets in the EU/US, the CHGS business outlook remains promising with
the easing of the lockdown.
PIEL launched 15+ new products and 35+ SKUs in 9MFY21 in India Consumer
Products (ICP), driving overall growth in this segment.
With the non-compete clause being over with regard to the Abbott deal, PIEL
may look to re-enter the Domestic Formulation space, subject to a strategic mix
and the valuation of inorganic opportunities.
The CDMO business tends to be a little lumpy, due to which sales were
moderately lower in 3QFY21. Health deliveries are scheduled for 4QFY21,
resulting in higher growth.
Others
Residential RE sales have now exceeded pre-COVID levels in most large cities.
11 February 2021
4
 Motilal Oswal Financial Services
Piramal Enterprises
Valuation and view
Over the past two years, PIEL deleveraged its balance sheet through: a) infusing
INR54b equity via preferential and rights issue, b) the sale of Decision Resources
Group (DRG) for USD900m, and c) a 20% stake sale in the Pharma segment to
Carlyle Group for EV of USD2.8b.
As a result, net debt to equity for the
consolidated entity has declined from 2x to 0.9x over the past two years.
In the Real Estate segment, the company seeks to sell down loans, a prudent
decision in this environment. Additionally, with real estate sales picking up in
the industry, escrow collections are likely to improve going forward.
The total provision buffer of INR29b (6.3% of loans) on the balance sheet is
comforting.
Given initial asset quality trends, we do not foresee any meaningful
addition to the same.
The Pharma business is seeing increased traction. The recent stake sale to
Carlyle has set the benchmark for its valuation.
We arrive at TP of
INR2,170
using SOTP (FY23E-based).
Buy.
Exhibit 1: SOTP (FY23E-based)
Value
(INR B)
211
182
54
68
515
387
32.9
Value (USD
B)
2.8
2.4
0.7
0.9
6.9
5.2
32.9
INR per
share
890
765
227
288
2,170
1,633
32.9
Source: MOFSL, Company
% To
Total
41
35
10
13
100
Rationale
1.0x PBV
Pharma EV/EBITDA 16x; EV of INR288b; 80% Stake; 20% Holdco dis
Based on our TP for SHTF and SCUF
1x PBV (Net of DTA, OCI and Shriram Group allocated NW)
Implied 1.3x Consolidated BV
Lending Business
Pharma Business
Shriram Group
Unallocated NW
Total Value
Current market cap.
Upside (%)
Key exhibits
Exhibit 2: Loan book runs down QoQ
34
20
0
-7
566
566
531
514
-10
510
-9
513
515
Loan book (INR b)
Growth (%)
6.9
6.6
6.4
5.7
6.5
5.4
5.5
5.2
6.3
6.2
Exhibit 3: NIM largely stable (%)
-3
-10
464
Source: MOFSL, Company
Source: MOFSL, Company
11 February 2021
5
 Motilal Oswal Financial Services
Piramal Enterprises
Exhibit 4: GNPL ratio up 120bp sequentially (%)
3.7
16.6
2.4
1.8
0.5
0.9
0.9
0.9
3.2
3.5
3.4
3.3
1.9
0.5
3.8
3.8
3.8
2.5
2.5
Exhibit 5: Return ratios stable (%)
17.0
14.9
RoA
13.6
RoE
12.0
12.0
11.5
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 6: Global Pharma revenue up 4% YoY
14
Global Pharma (INR b)
17
13
11
9
Growth (%)
8
4
9.4
Exhibit 7: Share of Indian Consumer business at ~10%
Global Pharma
8.7
5.9
9.3
8.5
India Consumer & Others
8.7
4.7
9.6
9.4
9.5
12
91.3
-12
10.6
13.9
10.6
12.0
11.9
15.5
13.1
12.5
94.1
90.7
91.5
91.3
95.3
90.4
90.6
90.5
Source: MOFSL, Company
Source: MOFSL, Company
11 February 2021
6
 Motilal Oswal Financial Services
Piramal Enterprises
Financials and valuations
INCOME STATEMENT
FY16
FY17
FY18
FY19
FY20
FY21E
Revenues
63,815
85,468
1,06,394
1,32,153
1,30,683
1,27,022
Change (%)
24.6
33.9
24.5
24.2
-1.1
-2.8
HealthCare
34,670
38,927
43,220
47,860
54,189
53,593
Financial Services
17,397
33,515
49,816
70,634
76,494
73,429
Info Mgmt
11,559
12,224
12,092
13,322
Others
188
802
1,266
337
EBITDA*
13,726
21,007
29,611
36,582
17,889
35,041
Change (%)
57.8
53.0
41.0
23.5
-51.1
95.9
HealthCare
3,266
6,028
8,001
9,809
14,336
10,719
Financial Services #
8,185
12,837
19,933
24,507
3,553
24,322
Info Mgmt
2,276
2,143
1,677
2,266
EBIT*
11,172
17,190
24,838
31,380
12,686
29,663
Change (%)
92.6
53.9
44.5
26.3
-59.6
133.8
HealthCare
1,151
3,124
4,244
5,880
9,208
5,341
Financial Services #
8,159
12,813
19,897
24,431
3,478
24,322
Info Mgmt
1,862
1,254
697
1,069
Unallocated Inc/(Exp)
-4,028
-3,988
-5,200
-6,605
-3,510
490
Core PBT
7,144
13,202
19,638
24,775
9,176
30,153
Change (%)
110.6
84.8
48.7
26.2
-63.0
228.6
Exceptional Items
457
-99
0
-4,656
0
0
Reported PBT
7,600
13,103
19,638
20,119
9,176
30,153
Taxes
495
2,281
6,928
8,611
19,604
7,538
Tax Rate (%)
6.5
17.4
35.3
42.8
213.7
25.0
PAT
7,105
10,821
12,710
11,507
-10,429
22,614
Change (%)
-73.6
52.3
17.5
-9.5
-190.6
-316.8
Minority Interest
0
-3
0
0
0
0
Share from Asso. Co
1,942
1,699
2,801
3,194
4,896
4,364
PAT Post MI
9,047
12,523
15,511
14,701
-5,533
26,978
Change (%)
-68.3
38.4
23.9
-5.2
-137.6
-587.6
Dividend (Including Tax)
3,635
4,348
5,415
6,065
3,500
9,442
* Ex Exceptional, # Post interest expenses; FY16-18 nos based on IND AS; FY18 Excluding one off DTA of INR35.6b
BALANCE SHEET
Y/E MARCH
Equity Share Capital
Reserves (Ex OCI)
Networth
OCI
Networth
Change (%)
Borrowings
Change (%)
Other liabilities
Change (%)
Total Liabilities
Loans+Investments
Change (%)
Goodwill
Fixed Assets
Other assets
Change (%)
Total Assets
FY22E
1,34,314
5.7
63,474
70,840
INR m
FY23E
1,52,900
13.8
72,995
79,905
38,248
9.2
13,647
24,602
32,620
10.0
8,019
24,602
488
33,108
9.8
0
33,108
8,277
25.0
24,831
9.8
0
5,339
30,170
11.8
10,560
46,935
22.7
16,424
30,511
41,057
25.9
10,546
30,511
488
41,544
25.5
0
41,544
10,386
25.0
31,158
25.5
0
5,981
37,139
23.1
12,999
FY16
345
1,21,102
1,21,447
8,037
1,29,484
-3.6
1,62,788
126.5
17,526
26.0
3,09,798
1,98,500
57.9
54,854
23,949
32,495
22.2
3,09,798
FY17
345
1,33,609
1,33,954
14,872
1,48,826
14.9
3,04,510
87.1
29,058
65.8
4,82,394
3,25,163
63.8
54,272
54,251
48,707
49.9
4,82,394
FY18
424
2,43,287
2,43,711
21,977
2,65,688
78.5
4,41,608
45.0
20,708
-28.7
7,28,004
5,14,984
58.4
56,326
57,402
99,293
103.9
7,28,004
FY19E
424
2,53,732
2,54,156
18,430
2,72,586
2.6
5,59,867
26.8
23,808
15.0
8,56,261
6,45,325
25.3
59,395
57,510
94,032
-5.3
8,56,261
FY20E
451
2,86,835
2,87,286
18,430
3,05,716
12.2
4,19,562
-25.1
23,808
0.0
7,49,086
5,48,231
-15.0
11,391
57,935
1,31,529
39.9
7,49,086
FY21E
451
3,39,371
3,39,822
18,430
3,58,252
17.2
4,13,571
-1.4
27,197
14.2
7,99,020
4,97,268
-9.3
11,391
63,729
2,26,633
72.3
7,99,020
FY22E
474
3,76,458
3,76,933
18,430
3,95,362
10.4
4,58,407
10.8
32,013
17.7
8,85,783
5,43,134
9.2
11,391
70,739
2,60,519
15.0
8,85,783
INR m
FY23E
474
4,00,599
4,01,073
18,430
4,19,502
6.1
5,27,168
15.0
37,437
16.9
9,84,108
6,18,814
13.9
11,391
78,520
2,75,383
5.7
9,84,108
11 February 2021
7
 Motilal Oswal Financial Services
Piramal Enterprises
Financials and valuations
Profitability Ratios (%)
EBITDA Margin - IT
EBITDA Margin - Pharma
Core ROE
ROE
Valuations
Book Value (INR)
BV Growth (%)
Price-BV (x)
EPS (INR)
EPS Growth (%)
Price-Earnings (x)
DPS (INR)
Dividend Yield (%)
E: MOFSL Estimates
FY16
19.7
9.4
5.5
7.5
FY17
17.5
15.5
9.8
9.8
FY18
13.9
18.5
8.2
8.2
FY19E
17.0
20.5
5.9
5.9
FY20E
26.5
-2.0
-2.0
FY21E
20.0
8.6
8.6
FY22E
21.5
8.4
8.4
FY23E
22.5
9.5
9.5
704
1.0
52
-68.3
18
776
10.3
73
38.4
21
1,148
47.9
73
0.7
25
1,198
4.3
69
-5.2
28
1,274
6.4
1.3
-25
-135.4
-66.6
13
0.8
1,507
18.3
1.1
120
-587.6
13.7
42
2.6
1,589
5.5
1.0
127
6.4
12.8
45
2.7
1,691
6.4
1.0
157
23.1
10.4
55
3.4
11 February 2021
8
 Motilal Oswal Financial Services
Piramal Enterprises
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/Associate%20Details.pdf
Details of pending Enquiry Proceedings of Motilal Oswal Financial Services Limited are available on the website
at
https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx
MOFSL, it’s associates, Research Analyst or their relative may have any financial interest in the subject company. MOFSL and/or its associates and/or Research Analyst may have
actual/beneficial ownership of 1% or more securities in the subject company in the past 12 months.
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.
Research Analyst may have served as director/officer, etc. in the subject company in the past 12 months. MOFSL and/or its
associates may have received any compensation from the subject company in the past 12 months.
In the past 12 months , MOFSL or any of its associates may have:
a)
managed or co-managed public offering of securities from subject company of this research report,
b)
received compensation for investment banking or merchant banking or brokerage services from subject company of this research report,
c)
received compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company of this research report.
d)
Subject Company may have been a client of MOFSL or its associates in the past 12 months.
MOFSL and it’s associates have not received any compensation or other benefits from the subject company or third party in connection with the research report. To enhance
transparency, MOFSL has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the
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. 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. 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.
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.
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.
Disclosure of Interest Statement
Piramal Enterprises
Analyst ownership of the stock
No
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 Financial Services Limited(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
11 February 2021
9
 Motilal Oswal Financial Services
Piramal Enterprises
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.
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.
11 February 2021
10