20 March 2017
Market snapshot
Equities - India
Close
Chg .%
Sensex
29,649
0.2
Nifty-50
9,160
0.1
Nifty-M 100
16,902
0.0
Equities-Global
Close
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S&P 500
2,378
-0.1
Nasdaq
5,901
0.0
FTSE 100
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0.1
DAX
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0.1
Hang Seng
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-0.1
Nikkei 225
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Commodities
Close
Chg .%
Brent (US$/Bbl)
51
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Gold ($/OZ)
1,229
0.4
Cu (US$/MT)
5,917
0.4
Almn (US$/MT)
1,902
0.8
Currency
Close
Chg .%
USD/INR
65.5
0.0
USD/EUR
1.1
0.4
USD/JPY
113.3
-0.1
YIELD (%)
Close
1MChg
10 Yrs G-Sec
6.9
0.0
10 Yrs AAA Corp
8.1
0.0
Flows (USD b)
17-Mar
MTD
FIIs
0.2
2.7
DIIs
-0.1
-1.0
Volumes (INRb)
17-Mar
MTD*
Cash
365
278
F&O
3,023
4,195
Note: YTD is calendar year, *Avg
YTD.%
11.4
11.9
17.8
YTD.%
6.2
9.6
3.9
5.3
11.9
2.1
YTD.%
-7.6
6.0
7.1
11.6
YTD.%
-3.5
2.1
-3.2
YTDchg
0.3
0.5
YTD
4.2
-0.2
YTD*
259
4,363
Today’s top research Idea
Ajanta Pharma (Initiating Coverage): Promising growth trajectory
Key drivers intact for superior growth, despite aberration in short term
v
We believe that AJP has enough levers to drive overall growth in sales as well
as profitability, largely led by US and domestic formulation. It has about 14
ANDAs pending for approval. AJP intends to file 12-15 ANDAs FY18 onwards.
v
Management has guided for average of USD2-3m of revenue per ANDA post
approval. Therapy-specific strategy would drive growth in domestic
formulations. We expect revenue growth to bottom out in FY18 and see good
improvement FY19 onwards. We expect EBITDA margin to remain stable as
marginal contraction in EBITDA margin of Africa business would be offset by
addition of higher margin US business.
v
We value AJP at a premium compared to peers in mid-cap pharma space, at
25x FY19 earnings to arrive at price target of Rs2,028, implying upside of 15%
from current levels.
Research covered
Cos/Sector
Key Highlights
Ajanta Pharma
Promising growth trajectory
(Initiating Coverage)
EcoKnowledge
Only two states implement 7th Pay Commission in FY18
Logistic
Revival in rail container volumes likely
Piping hot news
FinMin okays capital infusion for 10 public sector banks
v
Coming to the support of weak and non-performing public sector banks (PSBs),
Quote of the day
Successful people save in prosperous
times so they have a financial cushion in
times of recession.
the Finance Ministry has chalked out a turnaround-linked Rs. 8,586-crore
capital infusion plan for 10 PSBs.
Chart of the Day: We expect AJP to continue to outperform industry
Research Team (Gautam.Duggad@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.

In the news today
Kindly click on numbers for the detailed news link
1
Domestic air traffic grows
15.7% in February
Domestic air traffic rose 15.7 per
cent in February, ending thirteen
months of 20 per cent plus
growth. Domestic airlines flew 8.6
million people last month
compared to 7.4 million in
February 2016, a leap year…
2
Unilever is preparing a £6 billion ($7.44 billion) sale of some of its food
brands, British newspapers reported on Saturday. The Anglo-Dutch
company is planning to sell Flora margarine and Stork butter brands, the
Sunday Times said. The Sunday Telegraph, which also cited a 6 billion
pounds figure, cited sources as saying private equity firms Bain Capital,
CVC and Clayton Dubilier and Rice have started working on offers for the
"spreads" business, citing sources. Unilever did not immediately respond
to a Reuters request for comment…
Unilever prepares sale of food brands worth £6-bn
3
Adani Group aims to start
mining Australian coal in 2020
The Adani Group plans to begin
extracting coal from the $16.5-
billion Carmichael project in
Australia in 2020 after
environmental protests had
delayed the first phase of the
mine. The company will begin
work on the project three months
after it gets final approval from
Australia’s…
4
AC makers betting on
consumers’ shift to inverter
models
In line with the global trends, air-
conditioner makers are betting
big on the Indian market
beginning its shift towards
inverter air-conditioners from
regular or the fixed speed ACs.
With the new energy efficiency
ISEER rating set to kick-in from
next year…
5
Narendra Modi government
eyes Rs 50,000 cr from funds
via toll-operate-transfer mode
for NHAI
6
Ashok Leyland plans to set up
a facility in Jharkhand
Commercial vehicle major Ashok
Leyland Ltd (ALL) is planning to
set up a new facility in Jharkhand.
This will be the first investment
from a major automobile
company in the state, which has
identified the sector as one of the
key drivers to make it one of the
industrial hubs in the country…
7
Daiichi's Ranbaxy Profits
Outweigh Losses: Singhs
Former Ranbaxy promoters
Malvinder and Shivinder Singh are
hitting back at Daiichi Sankyo in
the Japanese drug ma . 3,500
crore ker's case to recover Rs from
them as part of an arbitration
award. The brothers claim that
Daiichi has made profits that far
outweigh the losses it incurred by
purchasing a majority
shareholding in Ranbaxy…
In a move that could fetch the
government upwards of R50,000
crore, a host of pension funds,
sovereign funds and private
equity funds may invest in the 75
road projects to be bid out in the
toll-operate-transfer (TOT ) mode.
Players such as Macquarie, Abu
Dhabi Investment Authority,
Canada Pension Fund, Brookfield
Asset Management, and IDFC
Alternatives in India are
understood to have shown keen
interest in these projects…
20 March 2017
2

Initiating Coverage | Sector: Healthcare
Ajanta Pharma
BSE Sensex
29,586
S&P CNX
9,154
CMP: INR1,760
TP: INR2,028 (+15%)
Buy
Promising growth trajectory
Key drivers intact for superior growth, despite aberration in short term
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
Avg. Val, INR m
Free float (%)
AJP IN
88.5
2,150/1,312
-6/-13/5
154
2.3
179.0
24.0
n
Financial Snapshot (INR b)
Y/E March
2017E 2018E 2019E
Sales
20.1 22.6 27.5
EBITDA
6.8
7.7
9.4
NP
5.0
5.6
7.0
EPS (INR)
56.0 63.8 79.6
EPS Gr. (%)
18.9 13.8 24.9
BV/Sh. (INR)
179.5 233.0 299.9
P/E (x)
30.6 26.9 21.5
P/BV (x)
9.6
7.4
5.7
EV/EBITDA (x)
22.2 19.4 15.6
EV/Sales (x)
7.5
6.6
5.3
RoE (%)
35.9 30.9 29.9
RoCE (%)
33.9 29.6 28.9
Shareholding pattern (%)
As On
Dec-16 Sep-16 Dec-15
Promoter
73.8
73.8
73.8
DII
2.0
2.3
4.0
FII
10.4
10.2
6.8
Others
13.8
13.7
15.4
FII Includes depository receipts
n
n
n
n
n
Ajanta Pharma
Key drivers intact
for superior growth
Ajanta Pharma (AJP) is a specialty pharmaceuticals company engaged in
the development, manufacture and marketing of finished dosages. It
started with repacking of products in 1973, and moved from OTC products
to prescription-based products for the Indian market. It has established
itself as a strong specialty player in the domestic market in Ophthalmology,
Dermatology and Cardiology. In addition, it has strong presence in the
international markets of Africa and Asia, and continues to build a strong
foundation for the US market.
We expect AJP to be on a high-growth path in the US market, led by a
healthy product pipeline and annual filings of ~12-15 ANDAs over next 2-3
years, subject to subsequent approvals. From INR40m in FY15, US revenues
are expected to reach INR1.9b by FY17.
Over FY11-16, AJP delivered a phenomenal 30% CAGR in domestic
formulations sales, as against industry CAGR of 14-15%. We believe that
AJP’s good pace of product launches, leading position in some products
and improving MR efficiency should help it to outperform, despite industry
growth lowering to 11-12%.
AJP has made good strides in the Africa and Asia markets, is one of the
leading companies in the anti-malaria business in East Africa, and has
outperformed industry growth in branded generics in the Franco Africa and
Asia regions. Although a brief pause is expected over the near term, we
believe the long-term drivers remain intact to support sustainable growth.
We expect AJP to deliver an 18% CAGR in sales and a 19% CAGR in earnings
over FY17-20E, led by a 46% CAGR in US sales and a 20.4% CAGR in
domestic formulations sales.
We value AJP at a premium compared to P/E multiple of 20-21x for mid-
cap pharma companies, at 25x FY19E earnings, on the back of its proven
superior track record in terms of revenue growth and profitability. We also
note that peers with a higher exposure to the US market are facing pricing
pressure in the base business, with some also facing regulatory headwinds.
AJP has a very low US base business and minimal regulatory risks over the
medium term. We thus initiate coverage on AJP with a Buy rating and a
target price of INR2,028.
US business to be the driving force behind overall growth
n
tushar.manudhane@motilaloswal.com
Please click here for Video Link
Tushar Manudhane
+
91 22 3010 2498
n
With product filings, manufacturing capacity and front end in place, we
expect AJP to perform strongly in the US. It has cumulative ANDA filings of
32, with 14 of these awaiting approvals (including two para IV filings).
Around 12-15 ANDAs are anticipated to be filed from FY18 on annualized
basis. Given the reduction in the time required for approvals and the
company’s aggressive filings, we expect reasonable growth in US sales over
next 3-4 years, subject to final approvals.
3
20 March 2017

Stock Performance (1-year)
n
We expect US sales CAGR FY17-20E of 46% to USD90m. Based on management’s
guidance, we have factored in average revenue of USD2-3m per ANDA per
annum. Given AJP’s performance in products like g-Zegerid and g-Abilify, there
could be potential for garnering more than USD5-8m per ANDA in some
products, which would further drive revenue growth.
AJP witnessed strong growth in the domestic formulations business, with a focus
on Ophthalmology, Cardiology and Dermatology. The company has launched
130+ products, which are first to market in the domestic formulations space.
Aggressive launches and improving MR productivity had led to superior growth
for AJP until FY15. However, product-specific issues moderated growth in FY16.
With smoothening of the base effect, we expect AJP to deliver 20.4% CAGR over
FY16-20E. A healthy launch pipeline and increased prescription share in
Ophthalmology, superior growth of base molecules in Cardiology, shift in market
share mix from cosmetology to prescription-based treatment in Dermatology,
and new product launches in the pain segment are likely to drive overall
domestic formulations revenue growth for AJP over next 2-3 years.
After exhibiting robust growth in the anti-malaria business in Africa (partly on
the back of loss of business by one competitor), we expect the base effect to
kick in. Also, with a marginal increase in funding to procure anti-malaria drugs,
we expect modest growth in anti-malaria sales over the medium term.
Currency headwinds impacted the branded generics business in Anglo Africa and
Asia. However, we expect a gradual recovery in these businesses.
In our view, the long-term growth is intact with a good revival expected from
FY19, led by strong growth in US, better-than-industry growth in domestic
formulations, and gradual revival in branded generics in Asia and Africa.
AJP has enough levers in place to drive earnings growth over next 4-5 years. It
has a proven superior track record in terms of revenue growth and profitability.
We note that peers with higher exposure to the US market are facing pricing
pressure in the base business; some peers are also facing regulatory headwinds.
AJP has low US base business and minimal regulatory risks over the medium
term. Also, after the 18.5% correction in the stock price since September 2016,
we believe AJP offers an attractive investment opportunity. Consequently, we
initiate coverage on AJP with a Buy rating and a target price of INR2,028.
Delay in ANDA approvals would result in slower growth in the US business,
impacting overall revenue growth. Lower-than-expected revenue from products
post final approval in the US market would also impact overall revenue growth.
Faster-than-expected re-entry of competitors in the anti-malaria business in
Africa may lead to some market share loss.
Delay in approvals from the DCGI/state governments for the domestic
formulations business may affect the launch trajectory and thus sales.
Late recovery in the economic environment may delay revival in the branded
generics business in Asia.
Therapy-specific strategy to drive growth in domestic formulations
n
n
We expect moderate growth in Africa and Asia
n
n
Valuation
n
n
Risks
n
n
n
n
20 March 2017
4

AJP business transformation till date
1979 -
First manufacturing facility set up at Chikalthana..
1983 -
Facility set up in Paithan Aurangabad and has approvals from USFDA and WHO prequalification.
1996 -
Set up in Mauritius, Goodland to cater the African markets and has been compliant with WHO cGMP guidelines.
2009
- Facility set up in Chitegaon to meet the requirements of Emerging markets.
2009 -
Facility set up in Waluj, Aurangabad. This facility is AJP’s API facility mainly for captive consumption.
2014 -
Facility set up in Dahej, Gujarat. Specially constructed to cater requirements of USA, WHO and Emerging markets.
2017 -
Facility set up in Guwahati, Assam to cater to Indian and emerging markets.
1992 -
Entered the
international market
Today
AJP has 354 product
registrations in Asia market
and therapeutic segments
like Cardio, Pain, MED, GI,
antibiotic, Derma, Anti
Histamine
AJP has 1,183 product
registrations in Africa- market
and therapeutic segments
like, Anti-malaria,
Multivitamin, Cardio,
antibiotic, Gynaec, MED, Pain
2007 -
Set up R&D facility
in Mumbai
Today
AJP has ~750 scientists
working on innovative
products for developing
formulations The R&D
expenditure has grown at
CAGR of 42% over last 3
years. In FY 17, the R&D
expenses as a % of sales
would be close to 7%.
2013
- Entered the US market
Today
Total ANDAs filed till date – 32
Final approval received till date – 16
Intend to file 12 to 15 annually for next 2 to 3 year.
There has been a substantial growth in the US
market in the past year at CAGR of 46%.
2020 E
- The Company has come
up with new facilities which will
soon be operational. Having said
that we expect the domestic
business to grow at CAGR of
18.6% (FY17E –FY20E) and US
business by 46.4% and launch of
new products to be added to the
vast pool of product range.
20 March 2017
5

AJP story till date in charts
Exhibit 1:
Robust revenue growth over FY07-17E
Revenue (INR b)
Revenue composition - FY17E
Domestic
Formulation
32%
US
10%
Asia
19%
2.7
3.2
3.5
4.1
5.0
6.9
9.4
12.2
14.9
17.4
20.1
ROW
1%
Africa
38%
Source: MOSL, Company
Exhibit 2:
1,559bp increase in EBITDA margin over past 10 years
EBITDA margin (%)
31.0
18.1
18.4
19.3
19.8
16.9
21.0
24.6
34.8
34.2
33.7
Source: MOSL, Company
Exhibit 3:
Revenue growth, coupled with improved EBITDA margin, led to increase in RoE
ROE (%)
33.6
20.9
22.9
19.5
21.7
23.0
34.2
49.0
45.6
41.4
35.9
Source: MOSL, Company
20 March 2017
6

17 March 2017
Economy
Diving into Trending Themes
Only two states implement 7
th
Pay Commission in FY18
FY17 revised deficit, however, much higher than budgeted
n
n
n
n
Of the 15 major states that have presented their 2017-18 budget by now, only two (Madhya Pradesh and
Rajasthan) have made provisions for the 7
th
Pay Commission (PC) in FY18. Six states have already implemented
the 7
th
PC in 2016-17, while the rest are yet to do so.
Not surprisingly, on an aggregate basis, spending on salary & wages (S&W) is budgeted to grow slower in FY18
(12%) than in FY17 (15%). Furthermore, budgeted spending growth is not very high from average growth over
past three years (9.6%) and much lower than 23%-24% growth during the 5
th
and 6
th
PCs.
Furthermore, we find that the 5
th
and 6
th
PCs boosted physical savings, not consumption. This time, however,
with limited arrears and generally lower increase in salaries, a boost to (physical) savings is doubtful, let alone
consumption.
Finally, since many states have implemented the 7
th
PC in the current year, the fiscal deficit for FY17 as per the
revised estimate (RE) is much higher than the budget estimate (BE). Nevertheless, with only two states making
provisions for the 7
th
PC next year, the FY18 fiscal deficit for the states is likely to be in control.
is Motilal Oswal’s new
product in which we deep-dive into trending macro-
economic themes. This new product complements
our existing “Ecoscope” product, which is reserved
for regular updates on macro-economics.
“EcoKnowLedge”
(as per budget estimate (BE)) versus growth of 9.6% in
the previous three years
(Exhibit 1).
It is also important
to note that this increase is much lower than 22.5%
growth during the 5
th
PC in late 1990s and 24% during
the 6
th
PC. Payout growth in the previous two PCs of the
states was broadly in line with that in the Center’s PC.
Exhibit 1: S&W bill for states* over the past decade
(% YoY)
23
25
S&W spending of states
17
11
12
10
13
9
7
About a year ago, there was too much excitement about
the Pay Commission awards. Not only was the central
government expected to implement 7
th
Central PC in
2016-17, but also most of the states were likely to follow
suit in the following years. The central government
employs about 5 million people (including defense
forces), while the state governments combined have a
workforce of about 10 million people. PC awards,
therefore, are not only important for the government
employees, but also for the economy due to the
expected consumption pick-up. As expected, the Center
implemented the 7
th
CPC in 2016-17 and the arrears
were disbursed with the
August 2016 salary.
However,
what went almost unnoticed was that several states also
implemented the PC in 2016-17 and revised the salaries
of the state government employees. A look at the 2017-
18 budgets of the 15 major states (accounting for ~65%
of total state budgets) reveals that total S&W spending
of these states grew 15% YoY in FY17 (as per revised
estimate (RE)) and is budgeted to grow 12% YoY in FY18
15
12
FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
* For 15 major states, accounting for ~65% of total state budgets
Source: State budget documents, Reserve Bank of India (RBI), MoSL
Total S&W spending of 15 states grew
15% YoY in FY17 (as per revised estimate
(RE)) and budgeted to grow 12% YoY in
FY18 (as per budget estimate (BE)) vs a
growth of 10.2% in the previous 3 years
20 March 2017
7

Sector Update | 17 March 2017
Logistic
Gateway rail volume trend
Gateway Rail (M TEU)
116
81
YoY (%)
69
17
37 29
-9
17
-18
8 8 16
Revival in rail container volumes likely
Pricing environment improving
n
n
n
Concor EXIM volume trend
Concor EXIM - Volumes (M TEU)
Y-o-Y Change (%)
7.2 5.8
1.5
-6.2
-5.6
0.8
9.711.0
10.0
6.6 8.0
n
We expect a pick-up in container rail volumes over next 12-18 months, led by: 1) a
revival in EXIM trade and 2) the rail sector becoming more competitive and thus taking
market share from road sector.
Pricing in the rail sector has likely bottomed out, given easing competitive intensity.
Against this backdrop, Container Corp (Concor) has initiated price hikes on the key
routes of Kathuwas and Ludhiana with effect from 1 March 2017.
Margins of the rail logistics players are likely to improve due to better volume
aggregation and cost-efficient measures adopted by players like Concor and Gateway
Rail Freight Limited (GRFL).
We prefer Gateway Distriparks (GDPL) over (Concor) due to the former’s better RoCE
profile, led by efficient capital allocation and a superior revenue mix.
Rail container volume revival on the cards
n
Container rail volumes in tonnage terms have been sluggish for past 24 months,
as the haulage hike taken toward end-FY15 led to market share loss for
container train operators (CTOs). Weak EXIM trade (particularly exports) further
impacted rail volumes for CTOs. We, however, expect a revival in container rail
volumes over next 12-18 months, led by 1) a recovery in EXIM trade growth (a
low base and a pick-up in exports) and 2) market share gains by the rail sector
due to its improved competitiveness (no haulage hike over past 24 months and
the subsequent increase in diesel prices).
Pricing environment improving led by reduced competitive intensity
n
EBITDA/TEU trend for Concor and
GRFL
CCRI
GDL
Pricing was under pressure over last 12 months as the commencement of new
terminals at Kathuwas and Ludhiana led to intensified competition among CTOs.
However, we do not anticipate the major terminals to add capacity in the north
region over next 12-18 months. Against the backdrop of easing competitive
intensity, Concor initiated a price increase in the Kathuwas and Ludhiana sectors
from 1 March 2017.
Margins bottoming out
n
Margins have been under pressure over past 24 months due to the subdued
pricing environment, as well as higher empty running charges led by trade
imbalance. With pricing improvement in the rail logistics space, GDPL
commencing the Virmagam terminal and higher double-stacking for Concor, we
expect margins for both Concor and GRFL to recover from the current levels.
20 March 2017
8

Prefer GDPL over Concor
n
We prefer GDPL over Concor as the expected RoCE profile of the rail segment of
GRFL (12.6% in FY19E) is superior to that of Concor (10.2%) due to the former’s
better capital allocation and favorable revenue mix. Although Concor could
outscore GRFL once the Dedicated Freight Corridor Corporation (DFCC) gets
commissioned, we strongly believe the event will only play out post FY20. Also,
we do not expect the recent issue of direct port delivery at JNPT to be a major
threat for GDPL’s earnings as JNPT CFS contributes only ~20% of its overall
EBITDA.
Valuation and view
n
n
At CMP, GDPL trades at 23x/19x on FY18/FY19E earnings (adjusted for 49%
stake of Blackstone in rail), which we believe is attractive, given ~520bp RoE
improvement over FY16-19E. We arrive at a TP of INR318 (upside of 26%) for
GDPL, valuing its CFS business at 12x FY19E earnings and its 40% stake in
Snowman at a 50% discount to market value. We, however, value GDPL’s rail
segment at 15x FY19 EV/EBITDA (at par with valuation of Concor), despite
Concor being the market leader by a huge margin, as GRFL (a GDPL subsidiary)
has (1) sustainable RoCE profile/return ratios compared to Concor, (2) a better
margin profile due to higher proportion of double-stacking and route
optimization based on profitability, and (3) higher volume growth trajectory
than Concor. Maintain
Buy
on GDPL.
At CMP, Concor trades at 25x FY19E earnings and 15x FY19 EV/EBITDA, which
we believe is expensive, given the deteriorating return ratios due to incremental
capex. On DFC-based valuation (WACC: 12.3%, TGR: 4.5%), we arrive at a fair
value of INR1,309/share. Given rich valuations, poor return ratios and limited
upside to our fair value, we maintain
Neutral
on Concor.
Revival of rail container volumes on the cards
n
After growing 18% YoY in FY15, container rail volumes in tonnage terms
declined 3% YoY in FY16 and increased by ~2% YoY from April 2016 to January
2017. While the volume decline in FY16 can be ascribed to the sharp haulage
hike of ~25% toward end-FY15 (which resulted in market share loss to the road
segment), the muted growth performance in FY17 was on account of weak EXIM
trade. We see a high probability of container rail volumes reviving over next 12-
18 months, led by: 1) recovery in EXIM trade growth (due to a low base and a
pick-up in exports), 2) market share gain by rail from road led by its improved
competitiveness (no haulage hike over last 24 months and subsequent increase
in diesel prices) and 3) commencement of JNPT’s fourth terminal toward end-
FY18 (which should support EXIM trade pick-up). While volume growth at GDPL
is likely to be led by the ramp-up of its terminal in Faridabad, we believe that of
Concor should be supported by the ramp-up of its six operational multi modal
logistics parks (MMLPs) and another nine MMLPs that are likely to be
operational over next 12 months. Concor has also gained market share by
~200bp over last 2-3 quarters led by the ramp-up of its new MMLPs.
20 March 2017
9

In conversation
1. SAIL: China shutting down steel capacities is an opportunity
for Indian steelmakers; SK Roongta, Former CMD
n
n
n
n
n
China shutting down steel capacities is certainly an opportunity for Indian
steelmakers and for global steel in general; in 2015-2016 China had exported
huge quantities of steel and that impacted the global prices quite a bit.
Steel production cut eases the pressure on Chinese mills to go for aggressive
exports and that helps in stabilising the world prices.
Domestic steel demand has grown at about 3-4% this year but steel production
in India has grown at about 9% on the strength of lower imports and higher
steel exports.
This demand scenario may continue for some more months but with the
economy expected to pick up especially manufacturing and infrastructure
sector, we are more confident about higher domestic demand growth in FY18.
Steel prices in India are primarily aligned to the global steel prices so even if the
demand goes up in India that does not mean that domestic prices will go up.
2. IOC: We have a Rs 2 lakh Cr Capex plan; AK Sharma, Director -
Finance
n
n
n
n
n
Got the cabinet approval for dilution of our stake by 24% in Lubrizol, 50-50 joint
venture between IOC and Lubrizol Corp., USA; had access to the lubricant
additive technology of Lubrizol through this JV.
Our technology which is developed by our R&D team, will also be made
available to the joint venture on which we will earn the royalty.
Have made more than Rs 200 crore on the sale of our stake in the JV, which was
formed in 2000 for an investment of Rs 119 crore. The one-time other income
would show in the next quarter.
Have been investing approx. Rs 15,000 crore annually on our capex for the past
3-4 years, the total capex this year should be Rs 20,000 crore.
Will spend Rs 2 lakh crore on capex over 5-7 years’ time. This is very much
doable with the current pace of investing.
3. Manpasand Beverages: We will get Rs 200-250 additional
revenues; Abhishek Singh, Director
n
n
n
The new plant will have a capacity of around 50000 cases per day and as per our
plan the plant will be completed in the next 12-18 months. Expecting additional
revenue of Rs 250-300 crore from this plant.
The plant is nearer to our raw material and we will be saving a lot in our logistic
costs as far as procurement of raw material is there.
Double-digit growth is going to continue for the next 10-20 years because we
are consuming very less beverage as compared to China and Europe and all
other countries and demonetisation has not really impacted Rs 5, Rs 10 products
in entire India so I do not think that there will be any hit in the growth rate.
20 March 2017
10

From the think tank
1. Infosys needs to think big in technology. by Subir Roy
n
The high decibel public warfare between the founders of Infosys and its board
and management began over issues of governance and ended (for the time
being at least) with a demand for share buyback and Infosys’s apparent
willingness to oblige. It is worth seeing if some insights can be gleaned by
looking at the standoff as an accountant versus engineer/technologist clash.
Who is best placed to lead a large firm — accountant, engineer or marketer? At
the end of World War 2, Britain, Germany and Japan went different ways.
Britain, which had built an empire on the strength of its industrial revolution,
declined as an industrial power.
2. New lease of life for handloom sector. by Sandeep Varaganti
n
India has always had a strong legacy of unique hand-crafted products. We find
testaments to the skill and creativity of our artisans from the Indus Valley, as
early as 5,000 years ago. Craft in India, evolved from the need to create articles
for day-to-day household, religious and cultural use. Handcrafted products
enjoyed a special place in palaces, temples and homes and enjoyed royal
patronage. Over the centuries, while clinging to important traditions from the
past, Indian craft is trying to adapt to changing global trends.
3. Narendra Modi Govt can surmount India’s biggest challenge by
reducing overall corporate tax rate by 2%. by TV Mohandas Pai
n
The services sector is the fastest-growing sector in India, growing at 8.8%, and
contributes the highest gross value-add and creates the most number of jobs. It
contributes more than 60% of India’s gross value-added growth. Despite the
slow-down in the post crisis period (2010-14), India had the fastest service-
sector growth, with a CAGR of 8.6%, followed by China (8.4%). Our tax laws
incentivise automation, capital intensive and big industry at the cost of labour
intensive and small scale industries which create more jobs.
4. Time right for Urjit Patel led RBI to cut interest rates; here’s
why. by Anuj Agarwal and Prachi Priya
n
Third quarter GDP data released by the CSO has fuelled scepticism, as growth
witnessed only a marginal slowdown to 7.0% from 7.3% in H1FY17. What is
surprising is the fact that fixed capital formation grew at 3.5% after three
quarters of contraction despite demonetisation. The CSO has been quick to
point out the caveats with respect to expenditure side data. Leaving aside the
debate on the credibility of the data, there is much more to worry about. There
is enough evidence to suggest that India’s capex cycle is yet to recover.
20 March 2017
11

5. A step towards ending the era of easy money. by Livemint
n
Stocks and bonds rallied after the US Federal Reserve raised interest rates on
Wednesday. This is in contrast to 2013, when just a hint that the US central bank
would start reducing the quantum of its asset purchase sent financial markets all
over the world into a tailspin. The Fed’s latest decision to raise rates was
perfectly coordinated as markets, until just a few weeks ago, were not expecting
the central bank to act in March. But members of the rate-setting committee,
including Fed chairperson Janet Yellen, clearly indicated in their recent public
appearances that the US central bank was on course to raise rates in March
itself.
6. Heartlight in the heartland. by James Owen
n
Much of the commentary around the BJP's stunn ing victory in Uttar Pra desh
has involved the prospect of Prime Mini ster Narendra Modi deploying his
renewed political capital to improve India's business environment. But what
does the win mean for UP itself ? For all its political heft, the state re mains an
economic outlier, with a percapita income of Rs . 40,373 ($620) a year, around
half the national average. Indeed, the PM's tweet on March 11 -“When UP
develops, India develops“ -hinted at the untapped economic potential of India's
most populous state. He also promised to transform Uttar Pradesh into RsUttam
Pradesh' -India's Rsbest state'.
International
7. MR. TRUMP’S tear-down budget. by The New York Times
n
The White House budget director, Mick Mulvaney, defended the president’s
budget proposal for 2018 by saying it puts numbers on Mr. Trump’s campaign
promises. That it does, but in so doing, it shows that many of those promises
simply cannot be kept. As he pledged, Mr. Trump would spend heavily on the
military and border security — but only, as it turns out, by spending far less in
areas like education and infrastructure that he had once deemed important.
This is, of course, very much a political document, full of bluster and
preposterous cuts that Mr. Trump must know that Congress, including many
Republicans, will not accept.
20 March 2017
12

Click excel icon
for detailed
valuation guide
CMP
(INR)
TP
% Upside
EPS (INR)
(INR) Downside FY17E FY18E FY19E
24
26
18
7
-3
11
12
5
16
7
-5
14
10
37
4
29.2
4.8
136.2
25.7
489.0
89.9
623.7
24.2
21.8
8.2
175.2
60.7
6.2
252.7
12.8
11.9
37.7
45.4
6.4
8.2
160.6 182.3
37.5
46.7
639.6 735.0
107.6 140.6
868.2 1,072.1
30.2
36.6
32.8
42.6
9.7
11.8
190.7 199.4
75.0
89.4
9.7
11.9
313.1 379.5
35.5
70.1
15.4
21.9
Valuation snapshot
P/E (x)
P/B (x)
ROE (%)
FY17E FY18E FY17E FY18E FY17E FY18E FY19E
30.0
18.9
21.4
40.3
46.5
14.1
39.4
28.9
23.6
26.5
19.1
21.5
34.2
24.5
37.4
37.2
27.6
36.8
23.0
27.4
19.0
25.1
16.3
20.3
28.6
NM
32.3
39.1
7.4
19.0
25.1
21.9
NM
12.2
49.6
9.3
19.4
21.6
31.8
18.2
27.2
34.0
18.7
11.6
47.3
31.0
13.9
15.6
24.2
36.9
11.7
23.2
14.1
18.1
27.6
35.5
11.8
28.3
23.2
15.6
22.6
17.5
17.4
21.8
19.8
13.4
28.7
18.9
20.7
19.0
23.9
15.9
20.9
15.7
15.7
23.6
5.8
26.3
27.8
6.6
15.6
19.8
9.0
7.4
8.0
11.8
8.8
6.5
11.4
12.7
5.0
10.8
26.0
21.1
10.0
37.8
28.1
11.2
13.1
21.6
28.1
10.1
5.9
4.1
6.0
6.1
9.1
2.2
14.0
5.6
2.6
3.8
7.0
3.2
2.4
5.7
1.9
9.0
4.1
2.2
2.4
2.5
1.7
4.3
1.9
1.5
4.2
0.7
4.1
4.3
0.7
3.9
3.0
1.1
0.5
0.6
0.7
0.9
0.3
0.8
1.2
0.5
0.9
7.0
4.2
1.8
13.4
5.8
3.4
2.8
2.7
2.8
2.2
4.9
3.4
5.3
5.3
7.7
1.9
10.0
4.6
2.3
3.4
6.0
2.9
2.1
4.7
1.7
7.2
3.6
2.1
2.1
2.2
1.6
3.7
1.8
1.4
3.6
0.6
3.6
3.8
0.6
3.2
2.7
1.0
0.5
0.6
0.7
0.9
0.3
0.8
1.1
0.5
0.9
5.7
3.5
1.6
11.1
5.2
3.0
2.4
2.6
2.6
1.9
21.6
23.1
30.0
15.9
18.8
16.4
41.1
21.2
11.4
14.2
40.1
14.3
7.7
22.8
5.2
26.4
15.0
6.3
10.9
11.3
9.4
18.6
10.4
7.4
15.5
-21.1
13.5
12.6
9.7
22.1
12.0
5.0
-2.4
4.9
1.4
10.4
1.7
3.9
3.9
2.8
3.3
22.5
29.6
16.6
31.0
19.6
26.0
19.1
11.4
7.7
19.8
23.1
26.3
31.0
20.6
23.4
16.9
41.2
21.8
15.6
14.9
36.8
13.6
10.3
23.2
13.3
27.9
18.9
10.3
11.8
9.9
10.4
19.3
9.9
8.9
16.4
11.6
14.5
14.4
10.0
22.6
13.6
11.5
7.0
7.2
5.8
10.2
4.8
6.8
9.2
9.7
7.9
24.1
18.0
16.6
32.1
19.6
28.9
19.5
12.2
9.7
20.3
22.9
28.2
30.9
22.0
22.6
18.9
37.1
22.1
17.7
15.9
33.0
14.5
11.3
23.2
22.2
31.4
22.0
17.3
13.1
11.1
12.1
19.8
11.3
10.2
17.2
12.5
16.0
17.7
11.3
23.0
15.5
14.4
8.9
10.3
7.3
11.1
5.6
8.6
11.5
13.0
10.1
25.9
19.4
17.2
31.6
19.0
32.3
19.6
14.0
11.4
20.8
Company
Automobiles
Amara Raja
Ashok Ley.
Bajaj Auto
Bharat Forge
Bosch
CEAT
Eicher Mot.
Endurance Tech.
Escorts
Exide Ind
Hero Moto
M&M
Mahindra CIE
Maruti Suzuki
Tata Motors
TVS Motor
Aggregate
Banks - Private
Axis Bank
DCB Bank
Equitas Hold.
Federal Bank
HDFC Bank
ICICI Bank
IDFC Bank
IndusInd
J&K Bank
Kotak Mah. Bk
RBL Bank
South Indian
Yes Bank
Aggregate
Banks - PSU
BOB
BOI
Canara
IDBI Bk
Indian Bk
OBC
PNB
SBI
Union Bk
Aggregate
NBFCs
Bajaj Fin.
Bharat Fin.
Dewan Hsg.
GRUH Fin.
HDFC
Indiabulls Hsg
LIC Hsg Fin
Manappuram
M&M Fin.
Muthoot Fin
Reco
Buy
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Neutral
Buy
Not Rated
Buy
Buy
Buy
877
1,087
91
114
2,914 3,432
1,035 1,110
22,731 22,049
1,267 1,406
24,602 27,458
700
732
513
596
219
233
3,345 3,190
1,303 1,486
211
-
6,189 6,808
476
653
442
462
Neutral
Neutral
Buy
Buy
Buy
Buy
Neutral
Buy
Neutral
Buy
Buy
Neutral
Buy
517
163
166
87
1,426
281
62
1,385
75
848
487
21
1,508
535
134
240
105
1,510
345
68
1,535
75
940
450
21
1,575
3
-18
44
20
6
23
10
11
0
11
-8
2
4
14.1
7.1
6.1
4.6
56.9
17.2
3.1
48.4
-25.2
26.3
12.4
2.8
79.3
25.0
8.6
6.9
5.5
68.3
17.9
3.9
58.7
13.0
32.3
17.5
3.1
97.0
46.8
10.9
8.7
6.9
81.5
21.8
4.9
71.2
15.4
41.3
24.6
3.8
118.4
Buy
Neutral
Neutral
Neutral
Buy
Neutral
Buy
Buy
Neutral
165
127
292
76
283
128
145
274
154
221
123
300
49
330
114
185
350
172
34
-3
3
-35
17
-11
28
28
12
7.5
-5.6
23.9
1.5
30.4
6.6
6.7
8.6
8.5
18.3
17.1
36.7
6.4
32.2
19.6
12.7
21.6
30.5
25.3
23.2
56.0
8.6
38.1
24.1
17.2
29.5
45.3
Buy
Neutral
Buy
Neutral
Buy
Buy
Buy
Not Rated
Buy
Buy
1,158
833
357
372
1,451
965
587
93
311
350
1,276
848
405
348
1,580
1,015
693
-
323
409
10
2
13
-6
9
5
18
4
17
34.1
44.6
30.7
7.9
46.8
69.5
37.6
3.8
8.4
29.7
44.6
39.5
35.6
9.8
51.7
86.2
44.7
4.3
11.1
34.7
59.3
51.5
42.0
11.7
57.3
109.6
52.6
5.2
13.9
40.5
20 March 2017
13

Click excel icon
for detailed
valuation guide
CMP
(INR)
141
708
168
2,061
1,055
TP
% Upside
EPS (INR)
(INR) Downside FY17E FY18E FY19E
117
-17
24.0
25.5
40.5
752
6
29.0
34.2
40.5
134
-20
29.4
35.3
39.9
2,500
1,225
21
16
91.2
58.1
130.5
77.9
164.2
96.7
Valuation snapshot
P/E (x)
P/B (x)
ROE (%)
FY17E FY18E FY17E FY18E FY17E FY18E
5.9
5.5
1.0
0.8
16.8
16.2
24.4
20.7
4.0
3.4
17.5
17.5
5.7
4.8
1.0
0.9
18.8
19.5
22.6
18.2
17.0
65.9
26.2
30.4
42.6
20.1
33.5
52.1
49.4
9.4
16.4
28.9
13.0
74.2
38.6
86.9
37.1
22.7
29.6
33.3
47.9
41.8
32.5
59.3
14.8
21.9
27.2
71.7
21.9
NM
NM
42.5
43.2
34.0
53.2
45.1
45.6
38.1
43.1
45.6
35.1
46.8
33.6
48.0
48.2
52.3
15.8
13.6
14.6
46.5
22.1
29.4
35.6
18.8
29.3
28.4
36.6
11.1
14.0
23.9
11.0
49.0
32.9
33.7
32.6
17.4
24.4
27.6
31.9
30.2
17.0
37.7
12.1
15.0
23.9
34.7
19.9
44.0
37.5
28.2
31.1
24.5
47.0
39.0
38.4
33.5
35.4
39.3
30.9
41.9
29.6
40.4
41.4
43.1
2.7
2.1
2.9
7.8
4.8
1.2
32.3
1.1
7.1
6.2
10.0
1.8
2.5
3.0
1.9
6.8
6.6
-2.1
4.3
3.1
4.8
3.6
2.4
3.1
1.9
4.1
1.7
1.3
3.4
3.7
4.1
3.0
5.2
7.8
4.8
3.4
16.3
17.2
23.9
9.9
12.7
9.5
8.2
32.2
8.9
7.3
14.5
19.7
2.4
1.9
2.6
6.7
4.2
1.2
21.9
1.0
6.5
5.6
9.0
1.6
2.2
2.8
1.6
5.9
5.7
-2.2
4.0
2.7
4.2
3.3
2.3
3.2
1.8
3.7
1.5
1.2
3.1
3.6
3.5
2.8
4.7
6.2
4.2
3.1
14.2
13.7
22.3
8.5
10.8
8.1
7.1
33.5
7.8
6.7
12.5
17.0
12.7
12.3
17.2
11.9
19.7
4.0
94.3
5.4
22.6
11.7
20.3
21.2
16.6
10.9
14.5
9.2
18.4
NM
12.1
8.9
17.1
10.8
5.0
7.5
6.0
7.2
12.0
5.8
13.3
5.2
20.3
-3.7
-3.1
19.9
11.7
9.9
32.5
42.9
54.9
28.3
33.8
22.4
25.1
67.6
28.4
15.7
33.3
35.9
16.1
14.7
17.7
14.4
19.0
4.0
73.3
5.5
23.2
20.7
24.6
15.3
16.8
12.2
14.6
11.9
18.6
-6.7
12.6
16.7
18.2
11.9
7.4
10.4
10.9
10.4
13.1
7.6
13.6
10.5
18.9
6.6
13.1
24.4
14.5
12.5
32.3
39.1
60.1
27.3
33.0
22.2
24.7
78.4
28.1
17.2
32.4
39.2
FY19E
22.3
17.7
18.9
17.6
16.1
18.9
15.9
19.3
4.0
66.1
6.0
25.3
19.2
25.1
14.3
16.2
13.6
16.6
14.2
19.0
-8.4
13.1
17.3
18.8
12.9
7.7
13.2
13.3
13.4
14.7
7.8
16.0
14.7
20.0
11.3
20.8
24.3
15.8
14.0
32.5
37.9
68.5
27.2
33.2
21.9
23.1
92.5
28.2
18.3
34.5
42.3
Company
Reco
PFC
Neutral
Repco Home
Buy
REC
Neutral
Shriram City
Buy
Union
STF
Buy
Aggregate
Capital Goods
ABB
Neutral
Bharat Elec.
Buy
BHEL
Sell
CG Cons. Elec.
Buy
CG Power & Indu. Sell
Cummins
Neutral
GE T&D
Neutral
Havells
Neutral
Inox Wind
Neutral
K E C Intl
Buy
L&T
Buy
Pennar Eng.
Not Rated
Siemens
Neutral
Solar Ind
Neutral
Suzlon Energy
Not Rated
Thermax
Sell
Va Tech Wab.
Buy
Voltas
Neutral
Aggregate
Cement
Ambuja Cem.
Buy
ACC
Neutral
Birla Corp.
Buy
Dalmia Bharat
Buy
Grasim Inds.
Neutral
India Cem
Neutral
J K Cements
Buy
JK Lakshmi Ce
Buy
Ramco Cem
Buy
Orient Cem
Buy
Prism Cem
Buy
Shree Cem
Buy
Ultratech
Buy
Aggregate
Consumer
Asian Paints
Neutral
Britannia
Buy
Colgate
Buy
Dabur
Neutral
Emami
Buy
Godrej Cons.
Neutral
GSK Cons.
Neutral
HUL
Neutral
ITC
Buy
Jyothy Lab
Neutral
Marico
Buy
Nestle
Neutral
1,213
162
168
194
73
893
313
441
182
172
1,551
137
1,261
734
19
907
601
389
1,190
180
115
205
45
990
340
425
175
175
1,660
-
1,340
800
-
781
760
365
-2
11
-32
6
-39
11
9
-4
-4
2
7
6
9
-14
26
-6
18.4
6.2
5.5
4.6
3.6
26.6
6.0
8.9
19.4
10.5
53.6
10.5
17.0
19.0
0.2
24.4
26.5
13.1
26.1
7.3
5.7
5.5
3.9
30.5
11.0
12.1
16.5
12.3
65.0
12.4
25.7
22.3
0.6
27.9
34.5
15.9
32.6
8.5
5.8
6.7
4.5
36.5
11.4
14.1
17.6
13.5
79.7
16.8
33.5
26.5
0.7
31.3
40.3
18.8
234
277
1,410 1,339
700
869
1,914 2,246
1,042 1,067
160
138
888
1,024
425
455
635
815
139
167
99
112
16,443 19,006
4,035 4,058
18
-5
24
17
2
-14
15
7
28
20
14
16
1
4.9
33.7
21.5
32.3
70.2
7.3
32.6
5.9
29.0
-1.8
-0.6
387.1
93.5
7.3
46.7
41.2
50.7
86.5
10.7
37.2
12.2
31.9
3.2
2.6
582.8
129.6
7.9
58.6
54.1
73.8
110.7
12.4
49.3
17.8
40.1
5.8
4.8
729.9
161.2
1,078
3,240
989
278
1,055
1,681
5,533
902
281
363
293
6,205
1,035
3,775
1,115
300
1,260
1,655
5,300
865
295
365
330
6,840
-4
16
13
8
19
-2
-4
-4
5
1
13
10
20.2
71.9
21.7
7.3
24.5
36.8
157.7
19.3
8.4
7.6
6.1
118.7
22.9
83.0
25.8
8.3
29.8
42.8
178.8
21.5
9.5
9.0
7.1
144.0
26.8
101.3
31.6
9.7
36.0
49.6
190.8
24.8
10.8
10.5
8.4
171.0
20 March 2017
14

Click excel icon
for detailed
valuation guide
CMP
TP
% Upside
(INR) (INR) Downside
14,641 16,910
16
219
215
-2
701
720
3
6,824 8,250
21
778
1,044
34
2,202 2,885
31
EPS (INR)
FY18E FY19E
305.1 388.4
9.7
12.1
18.3
20.5
167.7 198.8
15.4
19.8
47.0
64.0
Valuation snapshot
P/E (x)
P/B (x)
ROE (%)
FY17E FY18E FY17E FY18E FY17E FY18E
62.1
48.0
25.7
20.2
41.3
42.2
31.2
22.7
2.5
2.3
10.8
10.5
42.2
38.4
10.9
8.8
28.0
25.4
46.8
40.7
12.6
10.9
29.0
28.8
72.9
50.6
8.7
7.6
12.6
16.0
76.9
46.9
14.5
11.2
20.8
24.0
41.7
36.1
12.3
10.7
29.5
29.8
26.1
25.5
16.9
33.7
37.0
32.9
16.8
35.2
61.9
21.3
18.6
79.9
34.7
23.5
34.7
25.8
40.5
25.5
26.8
17.9
49.2
34.5
29.1
16.6
13.6
31.1
63.0
18.2
NM
NM
10.8
10.4
16.5
67.9
NM
29.9
42.5
35.5
11.4
15.7
NM
14.1
20.6
21.7
23.6
14.6
31.5
25.1
24.8
15.0
21.1
57.4
18.0
16.2
49.6
19.7
18.4
27.7
20.1
32.7
19.0
20.9
15.3
38.8
27.1
16.2
8.7
10.9
23.5
33.7
16.0
45.1
NM
9.8
10.2
14.5
39.5
14.0
25.2
29.5
25.6
8.6
11.0
NM
10.1
13.8
5.9
5.7
4.3
4.9
7.4
3.7
4.3
3.4
2.0
4.4
3.2
17.9
2.8
4.9
5.7
4.9
8.2
6.1
4.8
2.4
21.8
2.9
2.2
2.3
2.1
3.4
20.2
4.6
1.0
2.9
1.9
0.8
3.2
6.9
4.0
7.5
10.0
6.2
1.8
3.1
0.3
2.2
1.4
4.9
4.8
3.4
4.4
6.1
3.3
3.7
3.0
1.7
3.4
2.2
21.3
2.5
4.0
5.2
4.1
6.7
5.1
4.0
2.2
16.6
2.7
2.0
2.0
1.8
3.1
12.6
4.1
0.9
3.1
1.6
0.7
2.8
6.0
2.7
6.9
8.1
5.3
1.5
2.5
0.3
1.8
1.3
24.8
24.4
29.0
14.7
21.4
11.2
26.7
10.0
3.4
20.5
19.9
22.4
8.4
22.9
16.4
20.0
22.2
26.0
17.7
12.0
50.5
8.6
7.6
12.4
16.7
11.0
38.2
27.0
-4.1
-16.6
19.3
7.7
20.7
10.6
-10.2
25.1
31.3
17.3
16.1
20.9
-8.0
16.4
6.9
24.7
22.0
26.0
14.1
26.5
13.2
26.5
14.9
3.3
18.9
16.6
43.0
13.5
23.9
18.7
22.3
22.5
29.2
19.1
14.9
48.6
10.3
12.9
19.4
17.8
13.3
46.1
27.1
2.1
-6.1
17.8
7.1
20.6
16.3
23.5
27.3
30.3
20.6
18.8
25.2
-4.5
19.6
9.7
FY19E
43.2
12.9
23.4
29.5
17.8
24.9
30.3
25.3
21.7
23.8
15.7
27.9
14.7
25.7
16.1
6.0
19.1
18.4
56.9
15.9
22.1
19.8
22.4
20.7
29.6
19.4
15.0
46.8
10.6
15.3
25.4
18.6
14.3
44.7
27.5
8.1
3.3
16.9
7.0
20.4
22.0
11.2
29.0
29.3
21.7
17.7
22.0
-0.6
17.1
9.3
Company
Page Inds
Parag Milk
Pidilite Ind.
P&G Hygiene
United Brew
United Spirits
Aggregate
Healthcare
Alembic Phar
Alkem Lab
Aurobindo
Biocon
Cadila
Cipla
Divis Lab
Dr Reddy’s
Fortis Health
Glenmark
Granules
GSK Pharma
IPCA Labs
Lupin
Sanofi India
Sun Pharma
Syngene Intl
Torrent Pharma
Aggregate
Logistics
Allcargo Logistics
Blue Dart
Concor
Gateway
Distriparks
Gati
Transport Corp.
Aggregate
Media
Dish TV
D B Corp
Den Net.
Hathway Cab.
Hind. Media
HT Media
Jagran Prak.
PVR
Siti Net.
Sun TV
Zee Ent.
Aggregate
Metals
Hindalco
Hind. Zinc
JSPL
JSW Steel
Nalco
Reco
Buy
Neutral
Neutral
Buy
Buy
Buy
FY17E
235.6
7.0
16.6
145.7
10.7
28.6
Neutral
Neutral
Buy
Sell
Buy
Neutral
Neutral
Neutral
Buy
Neutral
Buy
Neutral
Neutral
Buy
Buy
Buy
Not Rated
Buy
605
2,027
687
1,119
444
596
763
2,735
183
886
130
2,756
549
1,454
4,480
707
527
1,448
630
1,850
915
750
510
550
815
3,050
240
990
160
2,700
540
1,850
5,000
850
-
1,700
4
-9
33
-33
15
-8
7
12
31
12
23
-2
-2
27
12
20
17
23.2
79.3
40.5
33.2
12.0
18.1
45.4
77.7
3.0
41.6
7.0
34.5
15.8
61.8
129.0
27.4
13.0
56.8
27.9
85.7
47.0
35.6
17.7
24.1
51.0
129.4
3.2
49.2
8.0
55.5
27.9
79.0
161.6
35.1
16.1
76.3
35.1
100.0
54.6
44.5
23.0
31.1
57.0
160.2
6.5
60.5
11.7
64.4
37.3
89.3
193.8
42.2
18.0
93.4
Buy
Not Rated
Neutral
Buy
Not Rated
Not Rated
169
5,046
1,242
255
138
230
191
-
1,309
314
-
-
13
5
23
9.5
102.5
36.0
8.8
8.4
16.9
11.1
129.9
45.8
15.7
15.9
21.0
12.5
163.2
50.0
20.1
23.9
25.9
Buy
Buy
Neutral
Buy
Buy
Neutral
Buy
Buy
Neutral
Neutral
Buy
106
383
83
38
286
84
178
1,409
38
750
519
115
450
75
47
355
85
215
1,533
40
735
600
9
18
-10
24
24
2
21
9
5
-2
16
1.7
21.1
-3.6
-2.4
26.5
8.0
10.8
20.8
-0.9
25.1
12.2
3.2
23.9
1.9
-0.8
29.4
8.2
12.2
35.7
2.7
29.7
17.6
4.8
27.4
7.7
0.4
33.2
8.7
13.9
56.8
1.2
34.5
20.9
Buy
Neutral
Buy
Buy
Buy
196
310
130
192
74
240
307
180
226
83
22
-1
39
18
13
17.2
19.8
-23.9
13.6
3.6
22.9
28.2
-17.5
19.0
5.3
25.6
29.5
-2.2
19.4
5.5
20 March 2017
15

Click excel icon
for detailed
valuation guide
CMP
(INR)
139
63
264
502
TP
% Upside
EPS (INR)
(INR) Downside FY17E FY18E FY19E
179
29
12.2
12.3
12.9
28
-56
-8.7 -14.2
-1.3
279
6
18.9
31.1
33.1
401
-20
17.4
43.8
51.4
Valuation snapshot
P/E (x)
P/B (x)
ROE (%)
FY17E FY18E FY17E FY18E FY17E FY18E
11.4
11.3
1.8
1.7
13.5
15.6
NM
NM
0.7
0.9
-9.6 -17.9
14.0
8.5
1.5
1.4
11.7
17.1
28.9
11.5
4.1
3.2
12.6
31.3
20.3
13.3
1.5
1.4
7.4
10.5
11.3
21.1
15.7
18.2
9.5
8.6
24.3
7.9
12.2
15.1
17.3
13.0
12.8
86.1
82.1
50.1
54.8
14.1
14.9
16.3
16.6
11.5
13.0
18.8
13.9
11.1
16.3
25.6
18.6
14.9
15.1
13.2
16.8
30.7
19.9
NM
89.7
40.7
16.9
16.5
17.4
13.3
12.7
14.7
11.6
23.6
13.2
14.5
11.4
9.4
24.5
8.1
8.6
9.0
14.6
11.3
11.1
49.3
41.9
47.8
48.0
11.9
13.4
14.6
15.3
9.8
12.3
14.0
14.3
8.6
13.7
21.0
17.2
13.2
13.6
10.7
15.6
45.3
18.5
NM
24.3
103.8
14.5
11.1
21.4
11.2
11.0
12.5
2.9
1.1
1.9
2.1
2.5
2.1
5.1
2.2
1.1
1.3
3.9
1.4
1.7
9.0
3.3
9.9
8.9
2.2
3.8
4.0
3.4
1.7
4.9
3.1
2.1
1.5
2.6
9.8
5.9
2.8
2.5
2.5
4.0
2.0
3.2
1.6
-96.6
2.4
5.9
1.9
1.2
1.4
2.1
2.3
2.5
1.1
1.7
1.9
2.2
1.8
4.4
1.8
1.1
1.3
3.3
1.3
1.5
9.8
3.0
8.7
8.1
2.0
3.3
3.4
3.1
1.4
4.1
2.8
2.0
1.3
2.5
7.8
6.0
2.4
2.2
2.1
3.7
1.9
2.8
1.9
32.4
2.3
5.9
1.6
1.2
1.3
1.8
2.1
27.5
5.3
14.1
12.0
27.9
25.9
22.1
31.0
9.5
8.7
24.4
11.7
13.2
10.4
4.2
21.2
16.2
15.7
27.3
26.5
23.2
14.0
41.8
17.1
14.1
14.2
17.5
42.5
33.9
20.1
17.0
20.0
23.7
6.7
15.7
-4.4
-75.4
5.8
35.2
11.0
7.0
10.8
17.4
15.8
23.4
4.6
13.7
13.5
20.7
20.7
19.3
24.7
12.7
14.4
24.2
12.1
13.9
19.9
7.7
19.3
16.8
16.5
26.7
25.0
22.5
15.9
36.2
21.0
14.4
16.5
18.9
41.3
33.4
20.0
17.0
21.1
23.8
4.3
15.9
-20.0
402.2
2.3
41.0
15.8
5.6
11.9
17.5
17.1
FY19E
15.0
-1.8
16.4
28.9
12.2
21.8
4.6
13.7
14.5
18.7
19.1
19.4
22.5
12.1
14.2
27.4
11.7
13.5
25.1
11.0
19.7
18.1
16.2
25.7
22.2
22.3
15.1
32.8
21.1
14.8
15.5
20.6
40.8
33.3
19.7
17.3
19.8
22.9
6.4
16.7
-23.7
97.6
4.5
46.0
15.2
2.2
13.3
17.7
18.0
Company
NMDC
SAIL
Vedanta
Tata Steel
Aggregate
Oil & Gas
BPCL
Cairn India
GAIL
Gujarat St. Pet.
HPCL
IOC
IGL
MRPL
Oil India
ONGC
PLNG
Reliance Ind.
Aggregate
Retail
Jubilant Food
Shopper's Stop
Titan Co.
Aggregate
Technology
Cyient
HCL Tech.
Hexaware
Infosys
KPIT Tech
L&T Infotech
Mindtree
Mphasis
NIIT Tech
Persistent Sys
Tata Elxsi
TCS
Tech Mah
Wipro
Zensar Tech
Aggregate
Telecom
Bharti Airtel
Bharti Infratel
Idea Cellular
Tata Comm
Aggregate
Utiltites
Coal India
CESC
JSW Energy
NTPC
Power Grid
Aggregate
Reco
Buy
Sell
Neutral
Sell
Buy
Neutral
Neutral
Neutral
Buy
Buy
Neutral
Neutral
Buy
Neutral
Buy
Neutral
642
295
375
161
513
376
1,043
102
336
190
393
1,301
778
-
335
163
620
458
1,032
114
382
204
460
1,240
21
-11
1
21
22
-1
12
14
7
17
-5
56.6
14.0
23.9
8.8
53.8
43.5
43.0
12.9
27.5
12.6
22.8
100.2
55.5
12.5
28.5
11.0
45.0
39.9
42.6
12.7
39.0
21.1
26.9
115.1
60.0
12.8
31.0
13.2
46.2
41.7
49.9
13.9
39.8
21.0
36.6
122.7
Neutral
Neutral
Neutral
1,104
336
462
1,008
300
420
-9
-11
-9
12.8
4.1
9.2
22.4
8.0
9.7
29.9
12.6
11.2
Buy
Buy
Neutral
Buy
Neutral
Buy
Neutral
Neutral
Neutral
Neutral
Buy
Neutral
Buy
Neutral
Buy
463
865
223
1,040
135
706
474
591
424
634
1,517
2,527
483
504
908
600
980
220
1,250
150
800
530
550
470
730
1,780
2,550
580
540
1,250
30
13
-1
20
11
13
12
-7
11
15
17
1
20
7
38
32.8
58.1
13.7
62.8
11.7
54.2
25.1
42.6
38.2
38.9
59.3
135.6
32.5
33.4
68.6
39.1
64.7
15.3
67.8
13.8
57.5
33.7
41.4
49.3
46.2
72.1
146.5
36.7
37.2
85.0
43.3
70.2
15.9
74.4
15.3
62.3
38.1
45.0
51.9
52.6
89.0
159.2
41.5
41.7
93.3
Buy
Buy
Under
Review
Buy
347
309
108
763
410
435
-
811
18
41
11.3
15.6
-3.1
7.7
16.7
-12.5
31.4
11.8
19.9
-12.0
44.8
6
8.5
Neutral
Buy
Buy
Buy
Buy
290
831
64
160
195
315
970
81
199
243
9
17
26
24
25
17.2
50.2
3.7
12.0
15.3
20.0
74.5
3.0
14.3
17.7
22.5
82.1
1.2
17.3
20.7
20 March 2017
16

Click excel icon
for detailed
valuation guide
CMP
(INR)
405
530
426
241
323
2,850
247
922
186
837
250
95
604
532
425
730
1,117
2,521
905
1,863
1,612
311
1,450
5,901
175
391
TP
% Upside
EPS (INR)
(INR) Downside FY17E FY18E FY19E
430
483
510
211
-
3,388
287
1,010
205
1,075
207
-
443
577
551
843
1,400
-
1,046
2,200
1,825
371
1,053
5,326
125
393
16
18
13
19
-27
-10
-28
1
-27
9
30
15
25
19
16
10
11
28
-17
6
-9
20
-12
13.5
10.9
13.6
4.6
16.3
67.6
12.4
39.3
13.7
16.9
2.5
5.5
17.2
23.4
26.0
14.9
28.3
72.9
30.4
74.5
82.4
7.5
27.0
107.8
3.7
7.0
21.8
14.2
13.8
8.8
20.0
112.9
13.9
54.1
17.1
19.0
8.2
7.6
18.5
28.6
31.0
23.1
40.8
89.3
34.8
127.1
99.9
10.1
35.1
139.9
4.6
11.9
28.6
17.7
14.6
11.3
25.5
166.7
16.9
72.2
20.6
21.9
11.5
10.0
22.1
36.1
36.7
38.3
54.3
109.3
43.6
164.7
125.1
13.3
42.9
178.6
5.4
16.0
Valuation snapshot
P/E (x)
P/B (x)
ROE (%)
FY17E FY18E FY17E FY18E FY17E FY18E FY19E
29.9
48.7
31.2
52.7
19.9
42.2
19.9
23.5
13.6
49.4
99.9
17.1
35.2
22.7
16.4
49.0
39.5
34.6
29.8
25.0
19.6
41.5
53.7
54.7
47.2
55.9
18.6
37.3
30.8
27.4
16.2
25.2
17.8
17.1
10.8
44.0
30.6
12.4
32.7
18.6
13.7
31.6
27.4
28.2
26.0
14.7
16.1
30.6
41.3
42.2
38.2
32.7
2.7
5.3
32.8
9.1
3.5
5.8
6.6
16.1
3.9
5.3
3.9
1.5
5.4
3.8
4.4
3.6
4.3
10.5
8.2
2.4
3.1
5.4
29.2
8.7
12.5
5.1
2.5
4.8
29.7
7.4
3.1
4.7
5.3
14.1
2.8
4.9
3.5
1.4
4.8
3.6
3.6
3.3
4.0
9.8
6.5
2.2
2.7
4.8
24.9
7.9
10.0
4.6
10.4
11.3
110.9
18.2
18.5
15.1
37.8
72.8
33.8
11.1
3.8
8.6
16.5
17.3
29.9
8.6
11.4
30.4
30.9
10.0
16.5
13.5
56.8
16.6
29.4
9.5
14.0
13.4
101.4
29.8
20.4
20.7
33.1
88.1
30.2
11.5
11.5
11.7
15.5
19.8
28.7
9.6
15.2
35.9
27.9
15.7
17.4
16.6
65.0
19.7
29.1
14.8
16.3
15.0
97.0
30.7
22.8
24.3
32.5
101.2
26.8
12.3
14.3
14.8
16.2
22.9
27.7
16.3
18.5
39.6
27.8
18.2
19.1
19.1
66.3
22.4
27.6
17.5
Company
Others
Arvind
Bata India
Castrol India
Century Ply.
Reco
Buy
Buy
Buy
Buy
Under
Coromandel Intl
Review
Dynamatic Tech Buy
Eveready Inds. Buy
Interglobe
Neutral
Indo Count
Buy
Info Edge
Buy
Inox Leisure
Sell
Under
Jain Irrigation
Review
Just Dial
Buy
Kaveri Seed
Neutral
Kitex Garm.
Buy
Manpasand
Buy
MCX
Buy
Under
Monsanto
Review
PI Inds.
Buy
Piramal Enterp. Buy
SRF
Buy
S H Kelkar
Buy
Symphony
Sell
TTK Prestige
Neutral
V-Guard
Neutral
Wonderla
Buy
20 March 2017
17

MOSL Universe stock performance
Company
Automobiles
Amara Raja
Ashok Ley.
Bajaj Auto
Bharat Forge
Bosch
CEAT
Eicher Mot.
Endurance Tech.
Escorts
Exide Ind
Hero Moto
M&M
Mahindra CIE
Maruti Suzuki
Tata Motors
TVS Motor
Banks - Private
Axis Bank
DCB Bank
Equitas Hold.
Federal Bank
HDFC Bank
ICICI Bank
IDFC Bank
IndusInd
J&K Bank
Kotak Mah. Bk
RBL Bank
South Indian
Yes Bank
Banks - PSU
BOB
BOI
Canara
IDBI Bk
Indian Bk
OBC
PNB
SBI
Union Bk
NBFCs
Bajaj Fin.
Bharat Fin.
Dewan Hsg.
GRUH Fin.
HDFC
Indiabulls Hsg
LIC Hsg Fin
Manappuram
M&M Fin.
Muthoot Fin
PFC
Repco Home
REC
STF
Shriram City Union
1 Day (%)
-0.9
-1.2
-0.8
-0.9
-0.7
0.9
0.4
-0.3
-1.0
-1.5
-0.1
-1.4
2.7
0.7
-0.8
1.0
0.7
-1.1
-1.9
-1.5
0.5
-1.3
0.0
0.6
1.1
-0.4
1.5
-0.2
-1.4
-2.0
-1.2
-1.2
-1.1
1.9
-1.0
-2.1
-1.7
-1.3
0.0
3.5
-0.2
1.6
0.1
2.0
-1.0
-1.5
5.7
0.2
3.2
1.3
3.9
0.5
0.0
1M (%)
2.7
-3.1
4.8
-2.4
3.6
12.2
-1.8
5.8
25.7
4.1
8.4
-1.0
5.6
3.3
5.2
4.0
5.7
18.3
-9.3
4.6
3.5
-0.8
-1.7
3.6
4.8
6.5
16.6
2.5
4.7
-0.7
1.9
0.3
-6.3
-2.2
6.1
3.3
2.0
8.5
6.4
-4.0
10.9
-1.3
3.5
12.9
5.4
-10.7
6.7
0.6
8.1
7.4
16.8
12.3
8.3
12M (%)
-2.8
-4.6
28.4
25.4
24.9
16.8
36.5
288.7
62.1
18.6
8.7
24.5
70.4
31.9
56.3
20.8
109.0
74.6
40.1
23.4
37.9
52.3
23.3
30.1
30.2
88.7
16.0
33.9
60.8
14.0
178.7
44.4
74.9
47.2
21.6
75.9
60.1
104.2
57.4
30.7
51.8
30.2
160.9
33.2
97.3
66.6
22.4
99.9
15.9
36.3
Company
Capital Goods
ABB
Bharat Elec.
BHEL
CG Cons. Elec.
CG Power & Inds Sol.
Cummins
GE T&D
Havells
Inox Wind
K E C Intl
L&T
Pennar Eng.
Siemens
Solar Ind
Suzlon Energy
Thermax
Va Tech Wab.
Voltas
Cement
Ambuja Cem.
ACC
Birla Corp.
Dalmia Bharat
Grasim Inds.
India Cem
J K Cements
JK Lakshmi Ce
Ramco Cem
Orient Cem
Prism Cem
Shree Cem
Ultratech
Consumer
Asian Paints
Britannia
Colgate
Dabur
Emami
Godrej Cons.
GSK Cons.
HUL
ITC
Jyothy Lab
Marico
Nestle
Page Inds
Parag Milk
Pidilite Ind.
P&G Hygiene
United Brew
United Spirits
Healthcare
Alembic Phar
Alkem Lab
Aurobindo
Biocon
1 Day (%)
0.4
-1.9
-0.1
-1.8
0.1
0.6
1.7
1.3
0.2
-1.7
-1.1
5.2
-0.1
0.4
3.3
3.4
-3.1
-0.3
-0.5
-0.8
0.1
0.7
-0.7
-2.1
-0.9
-1.1
-1.3
0.8
0.0
-0.1
-0.5
-0.9
0.6
1.1
1.3
0.4
0.0
0.5
-0.4
4.8
-0.8
0.1
1.1
0.1
0.2
0.3
-1.0
0.6
-0.7
0.2
3.8
-0.1
-0.2
1M (%)
-1.4
6.1
9.8
3.0
11.7
0.4
5.4
3.6
6.0
4.0
4.9
9.3
4.0
0.9
11.5
6.7
15.6
12.2
-1.7
-3.6
-0.1
1.0
0.1
-1.1
2.9
9.5
-5.6
4.0
6.5
7.6
8.5
12.2
-0.2
8.7
4.7
-1.4
4.3
8.4
7.1
4.8
1.3
8.9
-0.8
2.3
3.7
2.5
-2.2
-1.6
-6.9
9.6
1.2
3.3
1.2
12M (%)
5.6
49.9
51.9
56.5
5.9
-20.6
51.1
-31.2
45.1
29.9
-4.7
22.9
10.0
41.6
17.5
16.8
54.5
7.4
10.7
89.7
166.9
43.8
102.3
48.2
36.5
58.4
-2.7
28.0
41.3
33.3
23.8
20.3
18.4
12.3
12.1
30.3
-6.2
6.2
30.2
28.2
19.5
21.9
28.4
17.9
11.0
-3.3
-12.8
-0.8
49.6
-5.4
141.3
20 March 2017
18

MOSL Universe stock performance
Company
Cadila
Cipla
Divis Lab
Dr Reddy’s
Fortis Health
Glenmark
Granules
GSK Pharma
IPCA Labs
Lupin
Sanofi India
Sun Pharma
Syngene Intl
Torrent Pharma
Logistics
Allcargo Logistics
Blue Dart
Concor
Gateway Distriparks
Gati
Transport Corp.
Media
Dish TV
D B Corp
Den Net.
Hathway Cab.
Hind. Media
HT Media
Jagran Prak.
PVR
Siti Net.
Sun TV
Zee Ent.
Metals
Hindalco
Hind. Zinc
JSPL
JSW Steel
Nalco
NMDC
SAIL
Vedanta
Tata Steel
Oil & Gas
BPCL
Cairn India
GAIL
Gujarat St. Pet.
HPCL
IOC
IGL
MRPL
Oil India
ONGC
PLNG
Reliance Ind.
Retail
1 Day (%)
0.2
-0.7
-1.1
-0.6
-1.3
-1.3
-0.3
0.5
-0.4
-0.2
1.1
-0.6
0.7
5.5
-0.5
-0.6
0.1
0.1
0.6
0.3
-1.2
0.2
1.8
-0.5
-2.5
0.8
-2.5
0.5
0.4
-1.7
-1.0
-1.2
0.7
1.5
-0.2
-1.9
0.4
-0.3
0.0
0.6
-0.8
0.2
-0.9
0.8
-1.3
0.0
1.3
-1.1
-0.4
-1.0
0.1
0.3
1M (%)
-0.9
0.6
2.0
-6.2
-6.4
-6.4
2.6
2.6
4.0
-0.3
9.1
4.6
2.2
14.7
2.9
19.7
1.6
0.4
13.7
23.0
21.0
1.5
2.5
6.5
6.9
1.4
-5.7
10.6
-1.3
6.7
-0.3
6.8
3.5
39.8
3.7
14.7
1.7
5.8
0.4
7.3
-5.6
2.7
-1.8
-2.0
-5.6
-2.2
0.6
-6.9
0.6
-2.2
-1.9
21.0
12M (%)
31.8
13.7
-21.7
-12.4
2.0
9.3
9.7
-17.7
3.3
-13.2
7.5
-14.7
35.0
15.2
7.3
-9.6
6.2
0.8
26.6
36.4
29.6
20.5
-8.3
2.8
16.0
5.2
20.0
94.3
5.7
105.6
34.5
142.1
83.5
120.6
59.6
85.1
44.4
48.1
206.3
69.7
48.7
93.3
41.7
23.7
103.0
88.5
100.2
76.9
46.2
34.1
59.0
28.1
Company
Jubilant Food
Shopper's Stop
Titan Co.
Technology
Cyient
HCL Tech.
Hexaware
Infosys
KPIT Tech
L&T Infotech
Mindtree
Mphasis
NIIT Tech
Persistent Sys
Tata Elxsi
TCS
Tech Mah
Wipro
Zensar Tech
Telecom
Bharti Airtel
Bharti Infratel
Idea Cellular
Tata Comm
Utiltites
Coal India
CESC
JSW Energy
NTPC
Power Grid
Others
Arvind
Bata India
Castrol India
Century Ply.
Coromandel Intl
Dynamatic Tech
Eveready Inds.
Interglobe
Indo Count
Info Edge
Inox Leisure
Jain Irrigation
Just Dial
Kaveri Seed
Kitex Garm.
Manpasand
MCX
Monsanto
PI Inds.
Piramal Enterp.
SRF
S H Kelkar
Symphony
TTK Prestige
V-Guard
Wonderla
1 Day (%)
-0.8
-1.1
-0.6
-0.5
1.2
0.2
1.1
1.4
0.0
0.6
0.2
1.5
-0.1
4.9
0.3
0.3
0.8
-0.8
-3.7
-0.2
-4.5
-1.7
-0.8
-1.0
-0.1
-0.6
-0.4
-0.8
-0.5
0.8
-0.5
1.0
0.2
-1.7
3.4
-1.6
-0.2
0.3
-0.3
-1.7
0.0
1.8
1.0
-0.4
0.6
2.3
-1.8
-0.6
2.2
1.1
0.1
-2.2
0.4
1M (%)
11.3
8.2
7.3
-1.3
3.2
5.1
4.0
2.5
2.3
-0.2
1.7
-0.5
0.8
4.0
4.9
-3.9
5.9
-2.7
-6.1
0.1
1.8
1.6
-8.5
-3.4
5.3
-5.6
-3.9
7.5
5.8
-1.6
5.6
-5.3
-3.3
-0.5
11.5
12.9
-0.1
3.4
1.2
31.5
15.8
1.1
6.0
-0.6
8.7
4.4
-0.8
1.2
0.7
12.5
11.3
15.2
5.8
12M (%)
-3.2
-3.0
36.1
10.3
6.2
-16.0
-10.4
-4.5
-27.8
20.8
-9.7
-3.0
-20.7
7.4
-0.6
-6.4
6.3
1.5
-16.5
7.5
111.3
-1.6
79.2
-6.5
26.3
40.8
48.8
8.8
14.7
47.2
88.5
79.1
2.2
14.5
-1.0
7.7
26.2
69.3
-6.4
36.9
5.9
60.7
35.8
52.9
58.0
98.8
35.3
30.9
20.6
40.5
192.8
8.0
20 March 2017
19

NOTES
20 March 2017
20

THEMATIC/STRATEGY RESEARCH GALLERY

REPORT GALLERY
RECENT INITIATING COVERAGE REPORTS

DIFFERENTIATED PRODUCT GALLERY

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