9 August 2021
1QFY22 Results Update | Sector: Automobile
MRF
Estimate change
TP change
Rating change
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CMP: INR80,014
TP: INR83,730 (+5%)
Neutral
Operating de-leverage impacts performance
Price increases to pass on cost inflation happening gradually
MRF’s 1QFY22 operating performance was impacted by operating
deleverage and RM cost inflation. The industry is taking gradual price
increases to dilute the impact of severe cost inflation.
We cut our FY22E/FY23E EPS by ~11%/3%, factoring in the RM cost
inflation. Maintain
Neutral.
Revenue/EBITDA/PAT declined 13%/35%/49% QoQ to
INR41.3b/INR4.9b/INR1.6b.
1QFY22 revenue was down 13% QoQ (+70% YoY) to INR41.3b. The decline
was largely in line with peers [CEAT: 17% QoQ and APTY (S/A): 11% QoQ].
The decline in gross margin was restricted to 60bps QoQ (205bps YoY) at
37.9%. The decline of just 60bps QoQ is largely on account of a sharp
change in finished goods inventory. The gross margin decline was higher in
peers (CEAT: -310bps QoQ and Apollo S/A: -440bps QoQ) due to 10–12%
commodity cost inflation during the quarter.
EBITDA was down 35% QoQ (+47% YoY) to INR4.9b. The EBITDA margin
declined 390bps QoQ (180bps YoY) to 11.8%. This margin decline was
better than that in APTY (S/A) (-500bps QoQ / -40bps YoY), but worse than
that in CEAT (-270bps QoQ / -40bps YoY).
High other income and lower interest cost restricted PAT decline to 49%
QoQ (+846% YoY) at INR1.6b.
Cyclical recovery in both OEMs and replacement would enable the faster
absorption of new capacities (Gujarat plant) and drive the benefit of
operating leverage.
The industry pricing environment seems to be stable, with all players taking
price increases to pass on the substantial cost inflation. While there is likely
to be a transitory impact of the cost inflation in 2QFY22, we expect margins
to begin recovering from 2HFY22 (assuming stable commodity prices).
MRF’s competitive positioning within the sectors has weakened over the
past few years, further reflected in the dilution of pricing power in the PCR
and TBR segments. This, coupled with the impact of capex over the last
three years, has resulted in substantial dilution in its superior return ratios.
Current valuations at 27.2x/20.7x FY22E/FY23E EPS fairly capture the
changing competitive dynamics for MRF. We maintain a Neutral rating,
valuing it at 20x Sep’23E EPS (v/s 21.5x/14.5x its five-/10-year average P/E)
to arrive at our TP of INR83,730.
Revenue decline in-line v/s peers; price hike dilutes cost impact
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
MRF IN
4
339.4 / 4.6
98515 / 55326
-4/-21/-15
2353
Financials & valuations (INR b)
FY21 FY22E FY23E
Y/E March
Sales
161.6 191.0 204.5
EBITDA
29.4
29.0 35.1
Adj. PAT
12.8
12.5 16.4
EPS (INR)
3,012 2,942 3,862
EPS Growth (%)
-10.2
-2.3 31.3
BV/Share (INR)
31,636 34,428 38,090
Ratios
RoE (%)
10.0
8.9 10.7
RoCE (%)
10.0
9.1 10.8
Payout (%)
5.0
5.1
5.2
Valuations
P/E (x)
26.6
27.2 20.7
P/BV (x)
2.5
2.3
2.1
Div. Yield (%)
0.2
0.2
0.2
FCF yield (%)
10.2
0.4
2.1
Shareholding pattern (%)
As On
Jun-21 Mar-21
Promoter
27.8
27.8
DII
13.7
14.3
FII
14.1
13.5
Others
44.5
44.4
FII Includes depository receipts
Valuation and view
Jun-20
27.9
18.3
6.3
47.6
Jinesh Gandhi - Research analyst
(Jinesh@MotilalOswal.com)
Research analyst: Vipul Agrawal
(Vipul.Agrawal@MotilalOswal.com) |
Aniket Desai
(Aniket.Desai@motilaloswal.com)
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Investors are advised to refer through important disclosures made at the last page of the Research Report.
3 September 2019
1
 Motilal Oswal Financial Services
MRF
Standalone - Quarterly Earnings Model
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT before EO expense
Extra-Ord expense
PBT
Tax
Rate (%)
Minority Interest & Profit/Loss of Asso. Cos.
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
E: MOFSL Estimates
Key Performance Indicators
RM Cost(% of sales)
Staff Cost(% of sales)
Other costs(% of sales)
Gross Margin (%)
EBITDA Margin (%)
1Q
24,306
-44.9
20,991
3,315
13.6
2,730
737
430
279
0
279
108
38.8
0
171
171
-93.6
0.7
(INR m)
FY22E
FY21
2Q
3Q
4Q
41,864 45,668 47,377
6.0
13.9
30.7
33,319 36,036 39,921
8,544 9,631 7,456
20.4
21.1
15.7
2,839 2,831 2,970
528
638
745
443
634
565
5,620 6,797 4,306
0
0
0
5,620 6,797 4,306
1,590 1,680 1,134
28.3
24.7
26.3
0
0
0
4,030 5,117 3,173
4,030 5,117 3,173
82.9 116.3 -52.6
9.6
11.2
6.7
1Q
41,277
69.8
36,405
4,872
11.8
3,007
621
924
2,168
0
2,168
555
25.6
0
1,613
1,613
845.8
3.9
FY22E
2QE
3QE
4QE
48,143 50,234 51,386
15.0
10.0
8.5
40,801 42,280 42,548
7,342 7,954 8,839
15.3
15.8
17.2
3,100 3,245 3,548
650
650
655
800
800
801
4,392 4,859 5,437
0
0
0
4,392 4,859 5,437
1,142 1,263 1,423
26.0
26.0
26.2
0
0
0
3,250 3,596 4,014
3,250 3,596 4,014
-19.4 -29.7
26.5
6.8
7.2
7.8
FY21
1,59,214 1,91,041
-0.4
20.0
1,30,267 1,62,033
28,947
29,007
18.2
15.2
11,369
12,900
2,647
2,576
2,072
3,325
17,003
16,856
0
0
17,003
16,856
4,512
4,383
26.5
26.0
0
0
12,490
12,474
12,490
12,474
-10.5
-0.1
7.8
6.5
60.0
12.7
13.6
40.0
13.6
55.7
8.0
15.9
44.3
20.4
55.2
8.6
15.1
44.8
21.1
61.5
7.4
15.3
38.5
15.7
62.1
8.6
17.5
37.9
11.8
61.5
7.7
15.5
38.5
15.3
61.0
7.7
15.5
39.0
15.8
59.7
7.5
15.6
40.3
17.2
58.0
8.7
15.1
100.0
18.2
61.0
7.9
16.0
100.0
15.2
Key exhibits
Exhibit 1: Revenue trend
Revenue(INR b)
Growth(%)
69.8
39.8 39.7 38.7 39.1 38.9 40.5 40.3
30.7
8.1 9.4 6.2 6.2 14.4
0.5 -0.6
6.0
-11.0
-44.9
13.9
Exhibit 2: Trend in gross margin
Gross Profit(INR b)
42.8
Gross Margins(%)
40.0
44.3 44.8
38.5 37.9
Source: MOFSL, Company
Source: MOFSL, Company
9 August 2021
2
 Motilal Oswal Financial Services
MRF
Exhibit 3: EBITDA and EBITDA margin trend
EBITDA(INR b)
EBITDA Margin(%)
Exhibit 4: Trend in PAT
PAT(INR b)
6.7
5.1
4.0
3.2
1.6
0.2
2.6
2.6 2.8 2.9 2.7 2.2 2.4
6.0 5.8 5.5 5.7 6.0 5.4 6.1 5.7 3.3 8.5 9.6 7.5 4.9
Source: MOFSL, Company
Source: MOFSL, Company
Valuation and view
Well-diversified presence, with leadership across major segments:
MRF’s
leadership across the major segments of T&B, 2W, and PCR has led to the
creation of a strong brand and pricing power. It enjoys market leadership in 2W,
TBB, and Agri Tyres and is among the top three players in PCR and TBR. This has
translated into MRF having the highest profitability and superior ratios.
Dilution in competitive positioning:
However, aggressive competition in the
recent past has dethroned MRF from the top spot in the PCR and T&B segments
and resulted in overall market share loss. With new capacity coming in, MRF
should be able to defend its market position. Higher exposure to the TBB
segment, which is expected to have muted growth, makes it vulnerable to the
trend of ‘radialization’ in the T&B segment. We expect a ~12% revenue CAGR
over FY21–23E owing to healthy replacement demand.
Margin/RoE to remain under pressure:
The recent capex, leading to lower
capacity utilization, would keep margins and RoE in check over FY21–23E. We
expect a ~9% EBITDA CAGR over FY21–23E, with margins contracting ~100bp to
17.2%. PAT growth would be stronger (~13% CAGR) over FY21–23E
Steep valuations do not factor in downside risk:
MRF’s competitive positioning
within the sector has weakened over the past few years, further reflected in the
dilution of pricing power in the PCR and TBR segments. This, coupled with the
impact of capex over the last three years, has resulted in substantial dilution in
its superior return ratios. Current valuations at 27.2x/20.7x FY22E/FY23E EPS
fairly capture the changing competitive dynamics for MRF. We maintain a
Neutral rating, valuing it at 20x Sep’23E EPS (v/s 21.5x/14.5x its five-/10-year
average P/E) to arrive at our TP of INR83,730.
9 August 2021
3
 Motilal Oswal Financial Services
MRF
Exhibit 5: Change in estimates
(INR m)
Net sales
EBITDA
EBITDA (%)
Adjusted PAT
EPS (INR)
Rev
1,91,041
29,008
15.2
12,474
2942
FY22E
Old
1,88,184
31,230
16.6
14,080
3321
Chg (%)
1.5
-7.1
-140bp
-11.4
-11.4
Rev
2,04,466
35,121
17.2
16,374
3862
FY23E
Old
2,01,638
35,811
17.8
16,844
3973
Chg (%)
1.4
-1.9
-60bp
-2.8
-2.8
Exhibit 6: One-year forward P/E
P/E (x)
Min (x)
31.0
21.0
14.9
11.0
1.0
6.9
5.7
Avg (x)
+1SD
29.3
22.8
Max (x)
-1SD
24.2
Exhibit 7: One-year forward P/B band
P/B (x)
Min (x)
3.5
2.5
2.5
1.5
0.5
2.0
1.5
1.1
Avg (x)
+1SD
Max (x)
-1SD
3.1
2.2
Source: MOFSL, Company
Source: MOFSL, Company
9 August 2021
4
 Motilal Oswal Financial Services
MRF
Story in charts
Exhibit 8: Revenue and growth trend
Revenue (INR b)
Growth YoY %
18%
11%
7%
1%
150
FY18
161
FY19
162
FY20
0%
162
FY21
191
FY22E
204
FY23E
23
FY18
23
FY19
24
FY20
29
FY21
29
FY22E
35
FY23E
Exhibit 9: Expect ~9% EBITDA CAGR over FY21–23, margins
to contract by ~100bp to 17.2%
EBITDA (INR b)
EBITDA margin (%)
18.2
17.2
15.3
7%
14.4
14.6
15.2
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 10: Expect 13% PAT CAGR over FY21–23
PAT (INR b)
25.8
yoy %
31.3
Exhibit 11: Capital efficiency to remain weak
RoE (%)
12.3
11.0
10.6
12.3
10.0
10.7
8.9
10.8
9.1
RoCE (%)
11.3
-23.9
-0.1
-10.2
11.3
14.2
FY20
12.8
FY21
11.4
12.7
10.0
-2.3
12.5
FY22E
16.4
FY23E
FY18
FY19
FY20
FY21
FY22E
FY23E
FY18
FY19
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 12: Capex spending over FY21–23E to be largely
towards capacity ramp-up
Capex (INR b)
27
20
16
9
15
15
Exhibit 13: FCF generation to be consistently positive
FCF generation (INR b)
1.6
1.3
0.7
8.6
(7.1)
(4.8)
FY20
FY21
FY22E
FY23E
34.7
1.1
0.7
1.4
0.8
7.1
Cash conversion (x)
FY18
FY19
FY20
FY21
FY22E
FY23E
FY18
FY19
Source: MOFSL, Company
Source: MOFSL, Company
9 August 2021
5
 Motilal Oswal Financial Services
MRF
Financials and valuations
Consolidated - Income Statement
Y/E March
Total Income from Operations
Change (%)
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
EBIT Margin (%)
Int. and Finance Charges
Other Income
PBT bef. EO Exp.
EO Items
PBT after EO Exp.
Tax Rate (%)
Reported PAT
Adjusted PAT
Change (%)
Consolidated - Balance Sheet
Y/E March
Equity Share Capital
Total Reserves
Net Worth
Deferred Tax Liabilities
Total Loans
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Other Current Liabilities
Provisions
Net Current Assets
Appl. of Funds
E: MOFSL Estimates
FY18
1,49,544
11.5
22,818
15.3
7,067
15,751
10.5
2,531
3,307
16,527
0
16,527
31.5
11,316
11,316
-23.9
FY19
1,60,625
7.4
23,054
14.4
8,076
14,978
9.3
2,673
4,217
16,522
0
16,522
31.6
11,306
11,306
-0.1
FY20
1,62,394
1.1
23,740
14.6
9,823
13,917
8.6
2,928
3,354
14,343
0
14,343
0.8
14,226
14,226
25.8
FY21
1,61,632
-0.5
29,423
18.2
11,408
18,016
11.1
2,747
2,099
17,368
0
17,368
26.5
12,771
12,771
-10.2
FY22E
1,91,041
18.2
29,008
15.2
12,900
16,107
8.4
2,576
3,325
16,856
0
16,856
26.0
12,474
12,474
-2.3
INR m
FY23E
2,04,466
7.0
35,121
17.2
14,190
20,930
10.2
2,448
3,645
22,128
0
22,128
26.0
16,374
16,374
31.3
FY18
42
97,340
97,382
6,198
21,636
1,25,218
79,709
18,787
60,922
10,789
41,450
51,621
21,973
21,499
2,337
5,812
39,567
15,685
20,924
2,958
12,054
1,25,218
0
FY19
42
1,08,331
1,08,374
8,402
21,024
1,37,801
94,725
26,863
67,862
14,035
38,547
63,969
29,932
23,827
1,045
9,164
46,612
17,094
26,235
3,284
17,357
1,37,801
0
FY20
42
1,22,105
1,22,147
4,289
18,375
1,44,812
1,25,384
36,687
88,698
17,409
15,193
73,123
29,052
22,994
11,811
9,266
49,611
19,053
27,097
3,461
23,512
1,44,812
0
FY21
42
1,34,094
1,34,137
3,802
20,398
1,58,339
1,42,502
48,094
94,408
10,022
58,740
62,649
29,388
22,543
1,694
9,024
67,480
34,414
28,915
4,150
-4,831
1,58,339
0
FY22E
42
1,45,932
1,45,974
3,802
16,398
1,66,176
1,57,502
60,994
96,507
10,022
58,740
65,713
28,855
27,217
-827
10,468
64,807
26,636
34,021
4,150
906
1,66,176
FY23E
42
1,61,458
1,61,501
3,802
12,399
1,77,704
1,72,502
75,184
97,317
10,022
58,740
73,064
30,157
29,129
2,574
11,204
61,440
20,878
36,412
4,150
11,624
1,77,704
9 August 2021
6
 Motilal Oswal Financial Services
MRF
Financials and valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
FCF per share
DPS
Payout (%)
Valuation (x)
P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
ROIC
Working Capital Ratios
Fixed Asset Turnover (x)
Asset Turnover (x)
Working Cap. Turnover (Days)
Leverage Ratio (x)
Current Ratio
Interest Cover Ratio
Net Debt:Equity (x)
Consolidated - Cash Flow Statement
Y/E March
OP/(Loss) before Tax
Depreciation
Interest & Finance Charges
Direct Taxes Paid
(Inc)/Dec in WC
Others
CF from Operating incl EO
(Inc)/Dec in FA
Free Cash Flow
(Pur)/Sale of Investments
Others
CF from Investments
Issue of Shares
Inc/(Dec) in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Opening Balance
Closing Balance
FY18
2,669
4,336
22,967
2,032
60
2.7
30.0
3.5
2.1
13.9
0.1
12.3
11.4
15.4
1.9
1.2
24
1.3
6.2
-0.2
FY19
2,667
4,571
25,560
-1,676
60
2.7
30.0
3.1
2.0
13.9
0.1
11.0
10.6
13.2
1.7
1.2
37
1.4
5.6
-0.2
FY20
3,355
5,672
28,808
-1,126
65
2.3
23.8
2.8
2.0
13.9
0.1
12.3
12.7
15.0
1.3
1.1
26
1.5
4.8
-0.1
FY21
3,012
5,702
31,636
8,191
150
5.0
26.6
2.5
1.9
10.2
0.2
10.0
10.0
14.1
1.1
1.0
-15
0.9
6.6
-0.3
FY22E
2,942
5,984
34,428
322
150
5.1
27.2
2.3
1.6
10.3
0.2
8.9
9.1
12.8
1.2
1.1
3
1.0
6.3
-0.3
FY23E
3,862
7,209
38,090
1,663
200
5.2
20.7
2.1
1.4
8.3
0.2
10.7
10.8
15.1
1.2
1.2
16
1.2
8.6
-0.3
INR m
FY23E
22,128
14,190
2,448
-5,753
-7,317
-3,645
22,050
-15,000
7,050
0
3,645
-11,355
1
-3,999
-2,448
-848
0
-7,294
3,402
-827
2,575
FY18
16,527
7,067
2,531
-4,751
5,289
-2,408
24,255
-15,640
8,615
-5,309
685
-20,264
0
-1,325
-2,541
-306
-354
-4,526
-535
2,465
1,931
FY19
16,522
8,076
2,673
-4,156
-7,844
-2,742
12,529
-19,633
-7,105
5,960
-189
-13,862
0
3,523
-2,702
-307
-93
422
-911
1,931
1,020
FY20
14,343
9,823
2,928
-4,418
2,285
-2,235
22,726
-27,499
-4,773
25,852
10
-1,637
0
-6,347
-2,809
-307
-861
-10,324
10,766
1,019
11,785
FY21
17,368
11,408
2,747
-5,168
18,222
-1,331
43,246
-8,516
34,730
-43,336
989
-50,862
0
1,435
-2,540
-424
-971
-2,500
-10,117
11,785
1,668
FY22E
16,856
12,900
2,576
-4,383
-8,258
-3,325
16,366
-15,000
1,366
0
3,350
-11,650
0
-4,000
-2,576
-636
0
-7,212
-2,495
1,668
-827
9 August 2021
7
 Motilal Oswal Financial Services
MRF
NOTES
9 August 2021
8
 Motilal Oswal Financial Services
MRF
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
9 August 2021
9
 Motilal Oswal Financial Services
MRF
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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.
9 August 2021
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