14 February 2021
3QFY21 Results Update | Sector: Metals
Nalco
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)
Free float (%)
NACL IN
1,933
91.2 / 1.3
52 / 24
-1/6/-2
643
48.5
CMP: INR49
TP: INR59 (+21%)
Higher LME prices boost profitability
Retain Buy on improved earnings outlook and dividend yield
Buy
Nalco’s (NACL) 3QFY21 result was strong on the back of higher LME prices. It
reported an EBITDA of INR4.3b (+57% QoQ) and PAT of INR2.4b (+123% QoQ).
We raise our FY21E/FY22E EPS estimate by 9%/13% to factor in a lower tax
rate. We expect alumina prices to stay strong which should support strong
cash flows and a good dividend payout (8% yield in FY22). Maintain
Buy.
Revenue was flat QoQ at INR23.8b (4% above estimate) as higher LME price
(+13% QoQ, +10% YoY) was offset by lower Aluminum sales (103kt, -16%
QoQ). Alumina sales, however, was up 21% QoQ to 344kt.
EBITDA rose 57% QoQ (11x YoY) to INR4.3b (7% above our estimate) led by
better realization. Depreciation increased 18% QoQ to INR1.7b.
The management opted for the new tax regime during 3QFY21. As a result,
implied tax rate in 3Q was lower at ~20% (v/s 31% in 2QFY21) as higher tax
provision made in earlier quarters was written back in 3Q.
As a result, PAT rose 123% QoQ to INR2.4b (21% above our estimate).
Aluminum:
It reported an EBIT at INR1.6b, up 116% QoQ (v/s a loss of INR1.4b
in 3QFY20). Revenue declined 7% QoQ to INR16.4b on lower volumes (103kt, -
16% QoQ). The same was offset by higher LME prices (USD1,925/t, +13%
QOQ). Sales were lower during 3QFY21 due to inventory destocking in 2Q.
Derived realization improved 12% QoQ (and 10% YoY) to USD2,153/t. Derived
EBITDA/t improved 104% QoQ to USD287/t.
Alumina:
Revenue (including inter-segment) stood at INR9.9b (+1% QoQ).
EBIT came in at INR1.8b (+52% QoQ). While alumina production rose 8% YoY
(14% QoQ) to 555kt, external sales rose 3% YoY (21% QoQ) to 344kt.
With spot LME aluminum hovering at ~USD2,000/t (up ~18% YoY), near-term
profitability outlook is strong. Alumina prices have not yet reacted to the
strength in aluminum and could surprise positively in FY22. With integrated
mining operations, NALCO is the best play on higher LME prices.
Aluminum market has been in surplus (2.8mt in CY20) which is expected to
continue in CY21 and could put pressure on prices in the medium term. We
have factored in LME at USD1,850/t in FY22E.
The management has announced a 1mtpa alumina refinery expansion at a
capex of ~INR64b and expects to complete the project in FY23. Given slow
execution, we, however, expect commissioning in FY24.
We value the stock on a SoTP basis at 5x FY22E EV/EBITDA and 0.75x book
value for growth CWIP to arrive at our TP of INR59. At the CMP, it provides an
attractive dividend yield of ~8%. Maintain Buy.
Higher LME boosts EBITDA by 57% QoQ
Financials & Valuations (INR b)
Y/E MARCH
2021E 2022E 2023E
Sales
86.5 99.4 100.8
EBITDA
13.1 17.5 18.6
Adj. PAT
6.3
9.5 10.0
EBITDA Margin (%)
15.2 17.5 18.5
Cons. Adj. EPS (INR)
3.4
5.1
5.4
EPS Gr. (%)
357.1 49.8
5.5
BV/Sh. (INR)
54.2 55.2 56.2
Ratios
Net D:E
-0.3 -0.1
0.1
RoE (%)
6.3
9.3
9.6
RoCE (%)
7.6 11.3 11.0
Payout (%)
79.7 80.8 80.4
Valuations
P/E (x)
14.5
9.7
9.2
P/BV (x)
0.9
0.9
0.9
EV/EBITDA(x)
5.0
4.7
5.3
Div. Yield (%)
5.5
8.4
8.8
Shareholding pattern (%)
As On
Dec-20 Sep-20 Dec-19
Promoter
51.5
51.5
51.5
DII
9.8
10.0
15.6
FII
7.2
7.2
11.8
Others
31.5
31.4
21.1
FII Includes depository receipts
Valuation and view
Amit Murarka - Research analyst
(Amit.Murarka@motilaloswal.com)
Basant Joshi - Research analyst
(Basant.Joshi@motilaloswal.com)
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.
 Motilal Oswal Financial Services
Nalco
Quarterly performance
Y/E March
Net Sales
Change (YoY %)
EBITDA
Alumina - EBITDA (USD/t)
Aluminum - EBITDA
(USD/t)
As a % of Net Sales
Interest
Depreciation
Other Income
PBT (before EO Item)
Extra-ordinary Income
PBT (after EO Item)
Total Tax
Tax (%)
Reported PAT
Adjusted PAT
1Q
20,841
-29.9
2,144
106
63
10.3
16
1,264
614
1,477
0
1,477
499
33.8
978
978
FY20
FY21
2Q
3Q
4Q
1Q
2Q
3Q
23,636 20,884 19,359 13,806 23,749 23,788
-22.3
-23.2
-30.0
-33.8
0.5
13.9
322
343 2,084 1,291 2,759 4,339
57
56
81
38
69
85
-158
1.4
16
1,343
566
-472
0
-472
-188
39.9
-284
-284
-143
1.6
17
1,341
482
-532
0
-532
-193
36.2
-340
-340
-3
10.8
8
1,351
1,064
1,789
0
1,789
762
42.6
1,028
1,028
120
9.3
18
1,359
333
247
0
247
80
32.6
166
166
141
11.6
18
1,432
242
1,550
0
1,550
476
30.7
1,075
1,075
287
18.2
17
1,697
362
2,986
0
2,986
588
19.7
2,398
2,398
FY20
4QE
25,151
29.9
4,745
96
267
18.9
18
1,496
372
3,603
0
3,603
923
25.6
2,680
2,680
84,718
-26.3
4,892
72
-62
5.8
57
5,298
2,726
2,262
2,262
880
38.9
1,382
1,382
FY21E
86,494
2.1
13,133
76
207
15.2
72
5,983
1,309
8,386
8,386
2,067
24.7
6,319
6,319
(INR m)
3Q v/s our
FY21E est.(%)
22,813
4
9.2
4,062
7
68
329
17.8
18
1,395
386
3,034
0
3,034
1,060
34.9
1,974
1,974
22
-6
-2
-2
-45
21
21
Segmental quarterly performance
Y/E March
Alumina production (kt)
CoP (USD/t)
Aluminum production (kt)
CoP (USD/t)
Aluminum sales (kt)
Alumina sales (kt)
Average LME Aluminum (USD/t)
NSR premium (USD/t)
Alumina NSR (USD/t)
1Q
583
264
111
2,016
103
231
1,792
257
369
FY20
2Q
3Q
477
516
241
251
110
96
2,165 2,140
110
96
386
333
1,762 1,752
212
207
298
306
4Q
585
241
102
1,757
87
357
1,694
108
322
1Q
466
224
98
1,611
73
220
1,493
207
262
FY21
2Q
3Q
487
555
217
203
106
102
1,791 1,879
123
103
285
344
1,703 1,925
212
228
286
289
FY20
4QE
565
212
105
1,819
110
365
1,950
235
309
2,161
248
418
2,026
396
1,307
1,750
196
324
FY21E
2,073
213
411
1,787
409
1,214
1,768
220
286
3Q
FY21E
516
225
100
1,811
100
327
1,925
215
293
(INR m)
v/s our
est.
(%)
8
2
3
5
0
6
-2
Exhibit 1: Alumina/Aluminum production volumes (kt)
Alumina
101 101
105
Aluminium
111 112 110 111 108 111 111 110
96
99
102
106
98
102
566 573 526 509 516 566 583 471 538 561 583 477 516 585 466 487 555
Exhibit 2: Alumina/Aluminum realization (USD/t)
Alumina
2,392 2,380
2,126 2,305 2,318
Aluminium
2,049
1,974
1,959
2,153
2,561
1,906
2,266 2,288 2,075
1,802 1,700 1,915
277 323 290 314 413 405 548 535 476 394 369 298 306 322 262 286 289
Source: MOFSL, Company
14 February 2021
2
 Motilal Oswal Financial Services
Nalco
Valuation and view
With spot LME aluminum hovering at ~USD2,000/t (up ~18% YoY), near-term
profitability outlook is strong. Alumina prices have not yet reacted to the
strength in aluminum and could surprise positively in FY22. With integrated
mining operations, NALCO is the best play on higher LME prices.
Aluminum market has been in surplus (2.8mt in CY20) which is expected to
continue in CY21 and could put pressure on prices in the medium term. We have
factored in LME at USD1,850/t in FY22E.
The management has announced a 1mtpa alumina refinery expansion at a capex
of ~INR64b and expects to complete the project in FY23. Given slow execution,
we, however, expect commissioning in FY24.
We value the stock on a SoTP basis at 5x FY22E EV/EBITDA and 0.75x book value
for growth CWIP to arrive at our TP of INR59. At the CMP, it provides an
attractive dividend yield of ~8%. Maintain
Buy.
Exhibit 3: Target price calculation
EBITDA
EV-to-EBITDA (x)
Target EV
Add: Growth CWIP at 75%
Add: Cash surplus
Equity value
Target price
Key assumption
USD:INR rate
LME (USD/t)
FY19
29,561
FY20
4,892
FY21E
13,133
FY22E
17,451
5.0
87,256
15,750
7,234
1,10,240
59
75.0
1,850
35,772
20,355
22,925
69.9
2,033
70.9
1,750
74.2
1,768
Source: MOFSL, Company
14 February 2021
3
 Motilal Oswal Financial Services
Nalco
Financials and valuations
Income Statement
Y/E March
Net Sales
Change (%)
Total Expenses
EBITDA
% of Net Sales
Depn. and Amortization
EBIT
Net Interest
Other income
PBT before EO
EO income
PBT after EO
Tax
Rate (%)
Reported PAT
Adjusted PAT
Change (%)
Balance Sheet
Y/E March
Share Capital
Reserves
Net Worth
Total Loans
Deferred Tax Liability
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Investments
Curr. Assets
Inventories
Account Receivables
Cash and Bank Balance
Others
Curr. Liability and Prov.
Account Payables
Provisions and Others
Net Curr. Assets
Appl. of Funds
FY17
75,430
10.7
64,634
10,797
14.3
4,804
5,993
27
4,075
10,041
402
10,442
2,962
28.4
7,480
7,193
0.8
FY18
95,094
26.1
78,311
16,783
17.6
4,804
11,979
20
3,008
14,968
5,421
20,388
6,964
34.2
13,424
9,855
37.0
FY19
1,14,993
20.9
85,432
29,561
25.7
4,761
24,800
24
3,259
28,035
-636
27,399
10,075
36.8
17,324
17,726
79.9
FY20
84,718
-26.3
79,826
4,892
5.8
5,298
-406
57
2,726
2,262
0
2,262
880
38.9
1,382
1,382
-92.2
FY21E
86,494
2.1
73,361
13,133
15.2
5,983
7,149
72
1,309
8,386
0
8,386
2,067
24.7
6,319
6,319
357.1
FY22E
99,448
15.0
81,997
17,451
17.5
5,835
11,616
71
1,178
12,723
0
12,723
3,260
25.6
9,463
9,463
49.8
(INR m)
FY23E
1,00,789
1.3
82,166
18,623
18.5
5,719
12,904
71
589
13,422
0
13,422
3,439
25.6
9,983
9,983
5.5
(INR m)
FY23E
9,328
95,608
1,04,936
15,123
10,606
1,30,665
1,16,443
41,132
75,311
54,267
2,773
36,291
13,807
2,761
4,839
14,884
37,976
11,045
26,930
-1,685
1,30,665
FY17
9,665
92,387
1,02,052
511
12,456
1,15,018
80,489
9,044
71,444
5,660
389
67,517
11,559
1,843
35,084
19,031
29,992
8,641
21,351
37,525
1,15,018
FY18
9,665
95,384
1,05,048
450
11,515
1,17,013
85,022
13,627
71,395
9,152
1,176
64,415
11,941
2,581
33,619
16,274
29,126
9,774
19,352
35,290
1,17,013
FY19
9,328
95,517
1,04,845
668
11,307
1,16,820
91,155
18,297
72,858
8,827
1,758
68,027
12,100
2,405
35,772
17,750
34,650
13,069
21,581
33,377
1,16,820
FY20
9,328
90,553
99,881
123
10,606
1,10,610
98,443
23,595
74,848
14,267
2,773
53,609
16,969
1,401
20,355
14,884
34,886
7,956
26,930
18,723
1,10,610
FY21E
9,328
91,834
1,01,162
123
10,606
1,11,891
1,04,443
29,579
74,864
16,267
2,773
53,923
14,218
1,896
22,925
14,884
35,935
9,005
26,930
17,988
1,11,891
FY22E
9,328
93,648
1,02,976
123
10,606
1,13,705
1,10,443
35,414
75,029
35,267
2,773
38,465
13,623
2,725
7,234
14,884
37,829
10,898
26,930
636
1,13,705
14 February 2021
4
 Motilal Oswal Financial Services
Nalco
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
Dividend Yield (%)
Return Ratios (%)
EBITDA Margin (%)
Net Profit Margin (%)
RoE
RoCE (pre-tax)
RoIC (pre-tax)
Working Capital Ratios
Fixed Asset Turnover (x)
Asset Turnover (x)
Debtor (Days)
Inventory (Days)
Payable (Days)
Leverage Ratio (x)
Current Ratio
Cash Flow Statement
Y/E March
Pre-tax profit
Depreciation
(Inc.)/Dec. in Working Cap.
Tax paid
Others
CF from Op. Activity
(Inc.)/Dec. in FA + CWIP
Free Cash Flow to firm
(Pur.)/Sale of Investments
Interest and div.
CF from Inv. Activity
Equity raised/(repaid)
Int. Paid
Debt raised/(repaid)
Dividend (incl. tax)
Other financing activities
CF from Fin. Activity
(Inc.)/Dec. in Cash
Add: opening Balance
Closing Balance
FY17
3.7
6.4
52.8
2.8
110.4
13.2
7.7
0.9
0.8
5.5
5.7
14.3
9.5
7.2
7.9
8.0
0.9
0.7
9
56
42
2.3
FY18
5.1
9.4
54.3
4.7
81.5
9.6
5.2
0.9
0.6
3.6
9.6
17.6
10.4
9.5
12.9
16.3
1.1
0.8
10
46
38
2.2
FY19
9.5
11.8
56.2
4.5
84.9
5.2
4.1
0.9
0.5
1.8
9.2
25.7
15.4
17.2
24.0
34.6
1.3
1.0
8
38
41
2.0
FY20
0.7
3.6
53.5
2.8
441.7
66.1
13.7
0.9
0.8
14.0
5.6
5.8
1.6
1.4
2.0
-0.6
0.9
0.8
6
73
34
1.5
FY21E
3.4
6.6
54.2
2.7
79.7
14.5
7.4
0.9
0.8
5.0
5.5
15.2
7.3
6.3
7.6
10.0
0.8
0.8
8
60
38
1.5
FY22E
5.1
8.2
55.2
4.1
80.8
9.7
6.0
0.9
0.8
4.7
8.4
17.5
9.5
9.3
11.3
16.8
0.9
0.9
10
50
40
1.0
FY23E
5.4
8.4
56.2
4.3
80.4
9.2
5.8
0.9
1.0
5.3
8.8
18.5
9.9
9.6
11.0
18.8
0.9
0.8
10
50
40
1.0
(INR m)
FY23E
13,422
5,719
-73
-3,439
71
15,698
-25,000
-9,302
0
-25,000
0
-71
15,000
-8,022
6,907
-2,395
7,234
4,839
FY17
9,639
4,804
1,217
-2,184
884
14,359
-7,781
6,578
10,178
2,795
5,191
-28,407
-4
511
-8,259
-36,159
-16,608
51,692
35,084
FY18
20,388
4,804
-178
-4,825
-5,524
14,666
-8,374
6,292
1,718
1,522
-5,134
0
-1
-61
-10,934
-10,997
-1,465
35,084
33,619
FY19
27,399
4,761
3,274
-10,209
-447
24,779
-7,680
17,099
1,272
1,089
-5,319
-5,074
0
218
-12,451
-17,308
2,153
33,619
35,772
FY20
2,262
5,298
-9,071
-1,005
-971
-3,486
-8,578
-12,064
2,068
1,353
-5,158
0
-9
-579
-6,185
-6,773
-15,416
35,772
20,355
FY21E
8,386
5,983
3,305
-2,067
72
15,678
-8,000
7,678
0
-8,000
0
-72
0
-5,037
-5,109
2,570
20,355
22,925
FY22E
12,723
5,835
1,660
-3,260
71
17,029
-25,000
-7,971
0
-25,000
0
-71
0
-7,649
-7,720
-15,691
22,925
7,234
14 February 2021
5
 Motilal Oswal Financial Services
Nalco
NOTES
14 February 2021
6
 Motilal Oswal Financial Services
Nalco
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 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
********************************************************************************************************************************
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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 Motilal Oswal Financial Services
Nalco
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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.
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