27 January 2012
Re-initiating Coverage | Sector: Diversified
Sintex Industries
BSE Sensex
17,077
S&P CNX
5,158
CMP: INR79
TP: INR112
Buy
Long-term growth story, eclipsed by near-term slowdown
Most concerns priced in; Buy for 42% upside
Stock Info
Bloomberg
Equity shares (m)
52-Week Range
1, 6, 12 Rel. Perf. (%)
M. Cap. (INR b)
M. Cap. (USD b)
SINT IN
271.0
195
/59
4/-48/-41
19.8
0.4
Financial snapshot (INR b)
Y/E March
2012E 2013E 2014E
Oper. Income 46.3 49.0 54.4
EBITDA
7.7
7.9
9.0
Adj. Cons. PAT 3.7
3.8
4.4
EPS (INR)
13.8 14.0 16.2
EPS Gr. (%)
-16.1
1.7 15.9
B V/sh.(INR) 100.0 112.1 127.5
RoE (%)
14.6 13.2 13.6
RoCE (%)
11.9 11.4 12.8
P/E (x)
5.7
5.6
4.9
P/BV (x)
0.8
0.7
0.6
EV/EBITDA (x) 4.9
4.7
3.6
EV/Sale s (x)
0.8
0.8
0.6
We believe Sintex's long-term growth story is broadly intact:
1. Building materials: Offers secular play on government's spending on low cost
housing and social infrastructure e.g. slum rehabilitation is an INR4.5t opportunity.
2. Composites: Expect synergies with overseas subsidiaries and continuous
innovations to drive next phase of profitable growth.
Domestic and global slowdown will stretch Sintex's working capital and moderate its
growth momentum over FY11-14. However, its operating efficiency combined with
lower capex will help sustain positive FCF.
Most concerns are priced in; stock is attractively valued at 5.6x FY13E EPS. Re-initiate
coverage with TP of INR112 (8x FY13E EPS). Buy for ~42% upside.
Building Materials a huge opportunity; Sintex offers excellent play:
Sintex's
Building Materials business caters to two kinds of low-cost construction
opportunities - (1) Housing, via monolithic construction, and (2) Non-housing,
via prefab structures (rural classrooms and healthcare clinics, worker shelters,
etc). Low-cost housing demand will be mainly driven by slum rehabilitation, an
INR4.5t opportunity by our estimates. Here, Sintex's monolithic segment enjoys
a strong order book of INR30b (BTB of 2x TTM) to be executed over 22 months. In
the non-housing segment, expect Sintex's prefab structures business to benefit
from rising government welfare expenditure on social infrastructure projects.
"Plastic-ization" to drive composites growth; Sintex well-placed:
"Plastic-
ization" is an ongoing process of substitution of metals by plastic, driving Sintex's
composites business. We believe Sintex is poised to reap significant gains from
two kinds of synergies from its overseas subsidiaries:
(1) Client synergy:
Many
global clients of Nief (Sintex's European subsidiary) are expected to buy
composites from Sintex India. Subsidiary Bright is already supplying electrical
parts to Schneider. Other clients are also expected to follow shortly; and
(2)
Operating synergy:
Overseas subsidiaries will increasingly source intermediate
products and services (e.g. design) from India, leading to higher margins.
Headwinds may moderate growth, but balance sheet will improve:
Expect
Sintex's FY11-14 revenue CAGR of only 7% and EBITDA CAGR of only 3%, given
multiple headwinds: (1) Deteriorating working capital due to payment delays,
(2) delay/cancellation of projects (ahead of state elections), (3) order slowdown,
etc. However, focus on working capital management and disciplined capex would
improve FCF and balance sheet, to (1) enable USD290m FCCB redemption due in
Mar-13, and (2) bring down net debt-equity to 0.3x in FY14 from 0.6x currently.
Concerns priced in; re-initiating coverage with TP of INR112, Buy:
Sintex stock is
attractively valued at 5.6x FY13E EPS. This, we believe, prices in both (1) growth
slowdown, and (2) other concerns (FCCB repayment, conflict of interest issue
on power venture, etc). We value Sintex at 8x FY13E EPS, which is 33% discount
to its long-term average P/E. Our target price of INR112 offers ~42% upside from
current levels. Re-initiating coverage with a
Buy
rating. We believe recovery in
growth expected in 2HFY13 can provide with further re-rating catalysts.
Shareholding pattern % (Sep-11)
Foreign,
38.6
Others,
18.3
Domestic
Inst, 8.2
Promoter
35.0
Stock performance (1 year)
S i ntex Inds .
S ense x - Reba sed
220
175
130
85
40
Sandipan Pal
(Sandipan.Pal@MotilalOswal.com); Tel: +91 22 3982 5436

Sintex Industries
Sintex Industries: Re-initiating Coverage
Page No.
Building Materials a huge opportunity; Sintex offers excellent play...................... 3-8
Plasticization to drive composites growth; Sintex well-placed
.............................
9-14
Headwinds to moderate growth, balance sheet to improve
...............................
15-17
Concerns priced in; Buy with TP of INR112, 42% upside
.......................................
18-19
Key risks and mitigants
...............................................................................................
20
Financials and valuation
........................................................................................
21-22
Note:
All exhibits sourced from Company and MOSL, unless otherwise stated;
Stock prices and indices as of 25 January 2012
27 January 2012
2

Sintex Industries
Building Materials a huge opportunity;
Sintex offers excellent play
Sintex's Building Materials business caters to two kinds of low-cost construction
opportunities - (1) Housing, via monolithic construction, and (2) Non-housing, via prefab
structures (rural classrooms and healthcare clinics, sanitation, army barracks, worker
shelters, etc).
Low-cost housing demand will continue to be mainly driven by slum rehabilitation, an
INR4.5t opportunity by our estimates. Here, Sintex's monolithic segment enjoys a
comfortable order book of INR30b (BTB of 2x TTM) to be executed over 22 months.
However, delay in payments by state governments, policy inaction, state elections, etc,
could stretch working capital and dent pace of execution.
In the non-housing segment, we expect Sintex's prefab structures business to benefit
from rising government welfare expenditure on social infrastructure projects through
various programs, viz, JNNURM, SSA, NRHM, etc.
Excellent play on low cost construction technologies
Extremely low
penetration of housing,
classrooms and
healthcare in India, offers
huge opportunity and
revenue visibility for
Sintex
Sintex's Building Materials business caters to two kinds of low-cost construction
opportunities -
1.
Housing, via monolithic construction:
A relatively new construction technology,
which involves pouring concrete into a hollow plastic framework to build the
entire floor plan. This is well-suited for low-cost, massing housing - both in terms
of lower cost of construction and faster project completion.
2.
Non-housing, via prefab structures:
This involves assembling of concrete-
reinforced plastic panels, to create simple structures such as rural classrooms and
healthcare clinics, army barracks, worker shelters, sanitation blocks, etc.
Sintex offers excellent play on low cost construction technologies
Concept
Monolithic
An unconventional construction methodology by
pouring fluid concrete into light weight plastic
framework to construct wall/slab, with metallic bars
for strengthening. 5-8 storey structures can be built,
which have lifespan of ~25 years.
60-70% faster than conventional brick and mortar
system, especially for large repetitive structures.
Monolithic is 8-10% cheaper than conventional
process. All inclusive cost of INR900-1,100/sf (INR600/
sf for structure only).
No maintenance cost, eco-friendliness (use of fly ash
in mix), low labor intensity.
Low-mid cost housing, slum rehabilitation, housing
for police/army, student hostels etc
Majorly governments - various housing boards,
railways, defense, etc
RM 30-40%; Framework 5-7%; Labor 7-9%; Site
management 20-30% (smaller sites) and 12-13%
(bigger sites); Margin 18-19%
Prefabs
Simple structures built by assembling panels made of
concrete-reinforced plastic. Sintex offers end-to-end
solution in prefabs - manufacturing, logistics, and
installation at site.
Advantages
Faster execution
Cost advantage
Other advantages
Key usages
Key clients
Cost structure
Takes 10-12 days' time for setting up a simple school
structure under prefab.
Prefab is 15-25% cheaper than conventional process.
All inclusive cost of INR530-580/sf for a fully built
prefab structure is strongly competitive in Indian
scenario.
Typicality, reusability, low labor dependency
Public schools, healthcare clinics, site offices, Base
Transfusion (BT) shelter for telecom tower, agri sheds
70-75% government, rest private
RM 25-30% (incl purchased products, viz, asbestos,
paints, etc, and manufactured products); Kit-making
cost 18-20%; Logistics incl labor: 20-25%; Margin 20%
27 January 2012
3

Sintex Industries
Both the above segments put together offer a huge business opportunity in India e.g.
low-cost housing demand will continue to be driven by slum rehabilitation, an INR4.5t
opportunity by our estimates. We have tabled below key points of the two construction
technologies. We also apply Porter's 5-force framework to these businesses, and
assess Sintex's positioning in the same.
Sintex's Building Materials - 5-force analysis
3. Risk of Substitutes
MODERATE
Monolithic and prefab offer comparatively faster and cheaper
solution, albeit it works better only for repetitive and standardized
large structures.
2. Suppliers' Power LOW
R/ms (cement,
asbestos, paints, PVC
etc) are typical
commodities, vendors
have limited
bargaining power
5. Competition
1. Customer Power
HIGH
MODERATE
High, given a) Government
organization renders high
ticket projects with tighter
credit days, and b)
presence of large number
of players in the
conventional space
Several players in the conventional space. Some global and local
companies offer similar technology based solutions, viz, L&T,
Ahluwalia, Maninfra, Billimoria, etc
Sintex's positioning:
Together, L&T and Sintex enjoy equal share
amounting to a total of 70% of the monolithic low cost housing
done in India.
4. Entry barrier
HIGH
Execution is the key to competitive costing and faster delivery - which
requires: (a) High speculative upfront capacity investment with wider
reach within the country, (b) Optimization of material utilization.
Prefab is viable only for <1000km radius from manufacturing
locations. 2-3 day delay in logistics and erection process can eat
away viability in Prefab business.
Sintex's positioning:
Sintex
has established execution
credibility with
government bodies in
Gujarat, Rajasthan, UP.
Sintex's positioning:
Sintex's prefab plants are situated in 6
locations across the country to maximize coverage and logistics
advantage.
Monolithic: Key growth driver; Sintex well-placed with INR30b order book
Housing boards together
make up 40% of
monolithic order book,
INR7.5b under SRA,
JNNURM, Rajiv Awas
Yojna etc. INR2-3b under
railways, while defence
and private players make
up the rest
Monolithic business has been the key growth driver for Sintex over FY08-11, with 85%
revenue CAGR and 87% EBITDA CAGR. Its share in revenue and EBITDA mix has
increased from 9/10% in FY08 to 30/32% in FY11. Further, order book has growth from
INR14b in FY09 to INR30b (flat for the past few quarters), 2x TTM sales.
In monolithic, Sintex enjoys superior margin compared to other construction
companies. Rising entry of other players could moderate margins, going forward.
However, we believe Sintex will continue to have an edge over others due to
(1) in-house production of plastic framework, (2) early mover advantage and long
track record, providing (3) scale advantage and a strong client network.
27 January 2012
4

Sintex Industries
Monolithic has been key growth driver for Sintex (%)
Sal es contri bu ti on
32
28
25
16
9
10
15
30
22
25
25
28
29
EBITDA contri buti o n
Enjoys superior margin than construction peers
FY11 margin (%)
19.5
13.2
26
9.6
9.1
9.6
HCC
NCC
IV RCL
Si mpl ex
Si n tex
Order book comfortable at 2x TTM sales
Order Bo ok (INR b)
3.7
3.1
2.7
2.3
2.1
1.4
1.3
14
17
22
30
25
26
29
30
30
30
Boo k to Bi l l (x)
Meaningful rise in average order size/site (INR m)
800
700
2.2
2.1 2.0
2.2
350
150
480
18
FY08
FY09
FY10
FY11
FY12E
Source: Company/MOSL
Current slowdown could stretch receivable cycle, dent capex and growth
Management has also
adopted a strategy to
prioritize working capital
management over
growth by not deploying
cash in execution of a
monolithic project with
lower receivable
visibility
Sintex's excellent track record notwithstanding, the ongoing slowdown presents
several near-term challenges for this vertical. Key issues are:
1) Rising delay in government processes:
Various government bodies including
housing boards, railways, police, etc, are the major customers in monolithic
segment. Thus, under current challenging economic and political conditions,
monolithic business is adversely affected by pressure points like (1) delay in
government payments, (2) postponement of orders or re-tendering, (3) delay in
site clearance/handover (due to growing agitation), and (4) delay in technical
clearances. About 45% of Sintex's INR30b order book - slum rehab (INR7.5b),
railways (INR2.5b), defense (INR2.5b) - is facing execution slowdown or stoppage.
2) Stretched working capital cycle also affects execution:
Monolithic business is
working capital intensive with average net working capital days over 140 days.
Dealing with several government bodies keeps the receivable cycle naturally high.
While the company's increasing focus on collection management process is
positive, we expect no major improvement in working capital cycle over FY12-13,
given the economic slowdown. The upcoming state elections in UP (Sintex has
INR4.5b of order book from the state) could also lead to some collection delays.
Stretched working capital also affects execution.
We expect the segment to de-grow 15% in FY12 and grow 10%/15% in FY13/14. EBITDA
margin is expected to decline to 19%/17.5%/18% in FY12/13/14 v/s 19.5% in FY11.
27 January 2012
5

Sintex Industries
New order growth witnessed moderation (INR b)
8.9
4.9
4.2
9.8
8.7
4.5
Growth at Monolithic to moderate
Monol i thi c Revenue(INR b)
20%
19%
19%
18%
18%
EBITDA margin(%)
3.8
2.8
2.6
18%
(2.8)
(2.6)
4.5
7.2
13.4
11.4
12.5
14.4
Source: Company/MOSL
Monolithic: Huge long-term potential
Slum rehabilitation, an INR4.5t opportunity:
A recent government study
estimated India's slum population in 2011 at ~93m. This presents a housing
opportunity of at least INR4.5t. The government is committed to reduce
population residing in slums. This is evident in the rising budgets for initiatives
like Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and the
recently launched Rajiv Awas Yojna, specifically aimed at slum rehabilitation.
...presents a huge housing opportunity
93.0
61.8
46.2
27.9
Fast increasing slum population...
1981
1991
2001
2011
Slum population (m)
Persons per house
Houses required
Avg House Area (sqf)
Cost per psf
Cost per house (INR m)
Slum rehab opportunity (INR b)
93
6
15.5
300
1,000
0.3
4,650
Source: Industry/MOSL
Significant opportunity with Railways and Army:
Railways intends to build
houses for 1.4m employees by FY20; This is a significant opportunity since land
and funding are not that problematic for Railways. Likewise, every year, the
Indian Army plans to build 15,000-20,000 houses.
Prefabs: Government's social spending continues to drive demand
A significant portion
(30-35%) of the SSA
budget gets used up in
the construction of
classrooms in rural areas
For Sintex's prefabricated structures business, two major revenue contributors are:
(1) Classrooms under the Sarva Shiksha Abhiyan (SSA i.e. Education For All), and (2)
Healthcare centers under the National Rural Health Mission (NRHM). The budget for
SSA has increased from INR72b in 2006 to INR210b in 2012. A significant portion (30-
35%) of the SSA budget gets used up in the construction of classrooms in rural areas.
Similarly, the government has stated its objective of having a primary hospital in
every village in India under the NRHM. The budget for NRHM has grown at a CAGR of
18% over the last six years to INR178b in 2012. Thus, the size of the opportunity is huge
with central and state governments allocating funding to a wide range of social
schemes. In addition to government contracts (70-75%), there is also significant
opportunity in private sector projects such as cold chains, bunk houses, agricultures
sheds, etc.
6
27 January 2012

Sintex Industries
Increasing budgets in social schemes, viz, SSA, NRHM, etc (INR b)
250
200
150
100
50
0
20% CAGR
18% CAGR
24% CAGR
2006
2007
2008
2009
2010
2011
2012
Source: GoI/MOSL
Established track record bestows competitive advantage
Sintex has approvals in
place for 17 states, of
which 12-13 states
are active
Sintex has already erected several schools and hospitals under various government
schemes. It is now one of the very few players with the ability to erect a structure in
half the time usually taken by traditional contractors, which, in turn, helps the state
to meet its annual deadline. The company has approvals in place for 17 states, of
which 12-13 states are active. At present, projects from UP, Bihar and Gujarat account
for a major chunk of Sintex's prefab revenue.
Logistics accounts for a significant share of prefab construction costs. Hence, an
established capacity and wide geographical reach hold the key to cost-effective
execution. Sintex's prefab plants are situated in 6 locations across the country to
maximize coverage. The gestation period for the business is 2-3 years; hence, currently,
L&T remains the only competitor at the national level, with both Sintex and L&T
enjoying a combined market share of 60-70% (on equal basis).
Huge completive positioning due to first mover's advantage and wide plant network
Sintex's prefab plants are
situated in 6 locations
across the country to
maximize coverage
Kalol
Baddi
Dadri
Kolkata
Nagpur
Salem
Source: Company/MOSL
27 January 2012
7

Sintex Industries
Impact of slowdown: expect only a limited moderation in growth
We expect a limited
impact of project
slowdown due to
continuous product and
geographic
diversification and cost
savings on logistics by
servicing repeat
customers
Sintex's prefab segment has witnessed an 8% CAGR over FY07-11. This is despite a
sharp cutback in BT (base transfusion) shelter business, due to slowdown in roll-out
of telecom towers. Ex BT shelters, the CAGR would be much higher at 25-30%. This is
helped by strong social spending by governments on rural improvement projects, viz,
education, healthcare, sanitation, etc.
As in monolithic, Sintex's pre-fab business is also witnessing slowdown with only 5%
YoY growth in 9MFY12. But unlike monolithic, we expect a limited impact of project
slowdown due to the following reasons -
a) Continuous product and geographic diversifications with multiple projects from
same customer/geography offering resilience to capacity utilization and margin.
Unlike monolithic, prefab business involves several shorter gestation projects
with smaller ticket size, which reduces the risk of cancellation/delay.
b) There are no significant payment delays, as small orders (~INR1m for prefab as
against INR700-800m in monolithic) can be cleared at the collector level itself.
c) Virtual duopoly creating a high entry barrier (gestation period for a new entrant
would be 2-3 years).
Going forward, we model in a much more moderated revenue CAGR of 11% over
FY11-14. We also model in EBITDA margins to decline 100bp from 20.5% in FY11 to
19.5% in FY14. This, we believe, captures both positives and negatives.
Positives:
(1) Sintex's entry into new states like UP (FY11), Bihar, Maharashtra (FY12),
and (2) huge opportunity in newer segments like cold chain which could get further
boost with FDI allowance in multi-brand retail.
Negatives:
Approvals and collections in FY13 could be impacted by the outcome of
elections in several states viz. UP, Punjab etc.
Expect revenue CAGR of 11% over FY11-14
Pre-fa b Revenue (INR b)
20%
17%
7.8
8.8
21%
20%
EBITDA ma rgi n
19%
19.5%
6.7
5.6
6.5
7.0
2009
2010
2011
2012E
2013E
2014E
Source: Company/MOSL
27 January 2012
8

Sintex Industries
Plasticization to drive composites growth;
Sintex well-placed
"Plastic-ization" is an ongoing process of substitution of metals by plastic, driving Sintex's
composites business. We believe Sintex is poised to reap significant gains from two kinds of
synergies from its overseas subsidiaries:
1. Client synergy: Many global clients of Nief (Sintex's European subsidiary) are expected to
buy for their Indian operations, composite parts from Sintex India and its Indian subsidiary,
Bright Autoplast. Bright is already supplying electrical parts to Schneider in India. Other
clients like Areva, ABB, Bombardier, etc are also expected to have India operations shortly;
and
2. Operating synergy: Overseas subsidiaries will increasingly source intermediate products
and services (e.g. design) from India, leading to higher margins.
"Plasticization" trend to continue
Plastic composites are
gaining preference in
various industries over
metal due to their sheer
advantageous properties
Sintex will continue to benefit from the rising trend of "plasticization", i.e. substitution
of metals by plastic composites across industries, mainly autos, electrical, aerospace,
and healthcare, defense, etc. Plastic composites are gaining preference in various
industries over metal due to their sheer advantageous properties , viz, (1) low weight
but high strength (renders better fuel efficiency for Auto), (2) temperature resistance
and electrical insulation, (3) low corrosion and chemical inertness, etc. While
comparatively the growth is low overseas due to near-saturation in the rate of
substitution, significant opportunity exists in emerging countries like India.
Sintex's domestic positioning is strong
Sintex has established itself as a leading plastic composites molding player in India
with -
(1) A vast product range across segments, viz, household products, electrical and
automotive;
(2) A strong client base including auto OEMs (original equipment manufacturers),
engineering companies, state electricity boards, local governments, etc;
(3) Integrated processors and fabricators with as many as twelve plastic processes
(blow molding, injection molding, roto molding, extrusion, etc), and
(4) Manufacturing facilities across the country.
Key product segments:
Household products:
Interior, kitchen cabinets, waste bins, solar cookers, furniture,
crates, etc.
Electrical -
Meter boxes, pillar boxes, junction boxes, fiber-reinforced plastic
insulators, etc
Bright Auto:
Bumper systems, acoustic management systems, seating systems,
instrument panel, trims and pillars, exterior trims, radiator grills, air vent grab
handles, fuel tank, air ducts, two-wheeler parts, etc.
27 January 2012
9

Sintex Industries
Poised to enjoy synergies with overseas subsidiaries
Sintex embarked on an
inorganic growth strategy
in composites, through a
series of acquisitions
both in India and
overseas
Between mid-2007 and mid-2008, Sintex embarked on an inorganic growth strategy
in composites, through a series of acquisitions both in India and overseas. The major
acquisitions include (1) Bright Autoplast in India, (2) Nief Plastics, France, and (3)
Wausaukee Composites, USA (see table below for full details on acquisition in custom
molding/composites business).
The rationale behind Sintex's acquisitions was (1) foray into new verticals and clients,
(2) moving up the product value chain, (3) gaining technological prowess, and (4)
exploiting synergies. Post acquisitions, there was a major global slowdown. So,
overseas subsidiaries did not grow as expected. However, we believe, Sintex is now
poised to reap significant gains from two kinds of synergy: (1) Client synergy and (2)
Operating synergy.
Overseas subsidiaries: Key products and target segments
Nief Plastics:
35% electrical, 27% auto, 26-30% aerospace/defense as major
segments as on FY11 revenue of INR9.2b. Dependence on auto segment has declined
from ~60% in FY07 to ~28%, while concentration on France has come down to ~55%
(v/s. ~90% in FY07).
Wausaukee Composites:
Medical imaging, industrial trucks and tractors and mass
transit accounted for ~25% each to revenues of INR4b (including Nero Plastics).
Revenue is predominantly from the US.
Acquisitions in custom moldings to provide a strong client base
Company
Geiger Technik,
Germany (Written
filing
of Bankruptsy)
Nero Plastics
(Merged with
Wausaukee)
Nief Plastic,
France
Date
31-Jul-08
Stake Currency
(%)
90
Euro
Price
(m)
6.9
Products
Precision plastic
parts
Clients
BMW, VW, Daimler,
Audi, TRW, Bosch,
Siemens
Remarks
3-Dec-07
100
USD
28-Sep-07
100
Euro
Bright Autoplast
Pvt Ltd
6-Sep-07
100
INR
Wausaukee
Composites
31-May-07
100
USD
67% of revenue
from Tier l; off post
37% fromOEMs;
4 plants
4.8
Structural plastic and
Global OEMs
Acquired by
composite components
Wausaukee
Composites Inc
30.7 Plastic products for auto,
ABB, Areva,
11 manufacturing
electrical and electronics,
EADS, Faurecia,
plants - 7 in France;
aeronautics, defence,
Legrand, Schneider,
others in Hungary,
household appliances,
Siemens, Snecma,
Tunisia, Morocco,
building
ThyssenKrupp
Slovakia
Automotive, Valeo,
Visteon
1,489
Bumper systems,
Maruti Suzuki,
5 plants - Pune,
Acoustic management
Tata Motors,
Sohna, Chennai,
systems, seating
Honda, M&M,
Pithampur, Nashik
sytems, etc
Hyundai
20.5
Composite plastic
Philips, Siemens,
3 plants in the US
and fibreglass
Alstom, GE Medical,
components
Rail Plan Intl
Source: Company/MOSL
27 January 2012
10

Sintex Industries
Client synergy: Dedicated plant for Schneider; others may follow
What is Client synergy:
Many global clients of Nief (Sintex's European subsidiary) are
expected to buy for their Indian operations, composite parts from Sintex India and its
Indian subsidiary, Bright Autoplast. Bright is already supplying electrical parts to
Schneider in India. Other clients like Areva, ABB, Bombardier, etc are also expected
to have India operations shortly.
The Schneider experience:
Schneider Electric, a major client of Nief, has been investing
heavily in India since 2008. Recently, it acquired 74% stake in Luminous Inverters to
enter the business to customer (B2C) segment. Schneider plans to increase its exposure
to India by (1) serving institutional clients, and (2) growing retail presence through
organic and inorganic means. Nief has convinced Schneider to source its requirement
of composites in India from Sintex Group. A dedicated plant for Schneider is already
functional under Sintex's domestic subsidiary, Bright Autoplast.
Sintex is replicating the
Schneider model with
Nief's other clients like
Areva and Legrand
More clients to follow:
Sintex is replicating the Schneider model with Nief's other
clients like Areva and Legrand. Areva has become an anchor customer (dedicated
plant required, with 50-70% assured sales). Legrand, another French major, has signed
a contract with Sintex for outsourcing of electrical parts. Talks with ABB Alstom,
Bombardier, and other Nief customers are at advanced stages and the management
expects positive outcomes. We believe client synergy will meaningfully enhance
composites revenue growth for the Sintex Group as a whole.
Client synergy: Current and future
Client
Schneider
Areva
Legrand
ABB
ABB Alstom
Bombardier
Relationship
Anchor customer
Anchor customer
Contract customer
Contract customer
Expected to materialize
Expected to materialize
Vertical
Electricals
Electricals
Electricals
Electricals
Mass Transit
Mass Transit
Geography
India and Africa
India
Outsourcing
India
India
India
Source: Company/MOSL
Snapshot: convincing growth visibility from Nief's clients
Schneider's revenue of INR1.3b includes Nief (INR1b) and Schneider India
(INR300m) in FY11
Schneider is expected to place orders worth INR1.5-1.8b over next 2-3years.
Areva is expected to place orders worth INR0.6-1b over FY12-FY14, while ABB
Alstom is expected to place an order of similar size, followed by Bombardier
Operating synergy: Provides resilience to overseas margins
What is operating synergy:
Sintex is tapping operating synergies between Indian and
overseas operations: (1) in the first phase, by outsourcing intermediate processes
such as design and common services such as HR, finance and accounting from India,
and (2) in the next phase, by sourcing semi-finished goods from India.
Overseas, composite
vertical offers
tremendous scope for
margin expansion
Benefit - scope for margin expansion:
Overseas, composite vertical involves high-
cost labor (25-38% of revenue compared to 9-11% in India). Thus, there is tremendous
scope for margin expansion in Sintex's overseas subsidiaries through outsourcing to
India non-core, labor-intensive processes, and also sourcing from India intermediate/
semi-finished products.
11
27 January 2012

Sintex Industries
Besides, Sintex is also adopting various other margin-optimization and de-risking
steps in Nief, viz, (1) lowering production share of high-cost France facilities from
90% in FY08 to ~55% currently, by increasingly shifting production to low-cost
geographies such as Slovakia, Hungary, Tunisia, and Morocco, and (2) lowering
dependence on auto (down to 27% of revenue from 60% in FY08) by diversifying to
other verticals, viz, electrical, aerospace, defense, etc.
Slowdown likely to hurt growth, delay synergy benefit
The hyper growth
expectation from Bright's
new and potential clients
such as Schneider, ABB,
Areva has also been
impacted significantly
leading to a delay/
moderation of
expansion/spending plan
We expect the prevailing domestic and global slowdown to hurt revenue growth, and
also delay the expected synergy benefits, as explained below.
Nief, Wausaukee:
They account for ~64% of Sintex's composite revenue. Sovereign
debt crisis in Europe and slowdown in the US will affect topline growth for both.
Bright Autoplast:
About 85% of Bright's revenue comes from the Auto sector. Our
Auto team expects flat volume growth in FY12 and muted 10-15% growth in FY13.
Business from selling electrical parts to Nief clients like Schneider and Areva are
no longer expected to clock hyper growth expected earlier.
Sintex composites:
Major clients include industrial sector, State Electricity Boards
and Auto sector, all of which are in the midst of a slowdown.
Sintex expects clarity on client budgets to emerge in 1HCY12. However, we believe
the probability of slowdown is fairly high. We accordingly model in muted sales growth.
We also do not model in synergy benefit, and actually expect Composites EBITDA
margin to contract 150-200bp over FY11-14. The drop in margins could have been
much higher but for margin-optimization and de-risking steps described earlier.
Custom molding assumptions
Composit Business Break-up
FY08
FY09
FY10
FY11
FY12E
FY13E
FY14E
Nief [Auto, Electrical, Aerospace, Defence]
Revenue
3,489
7,400
8,040
9,246
9,986
8,987
9,436
EBITDA
298
850
965
1,110
974
854
944
EBITDA Margin (%)
8.5
11.5
12.0
12.0
9.8
9.5
10.0
Sales Growth (%)
112
9
15
8
(10)
5
Wausaukee + Nero [Electrical, Mass Transit, Medical, Wind energy, Agri equipments, Trucks etc]
Revenue
1,017
2,200
1,509
2,664
2,930
2,930
3,077
EBITDA
32
115
151
269
278
278
292
EBITDA Margin (%)
3.1
7.0
10.0
10.1
9.5
9.5
9.5
Sales Growth (%)
116
(31)
77
10
-
5
Bright Brother (majorly Auto components ~85%, Electrical parts)
Revenue
404
1,270
1,910
2,750
3,300
3,796
4,365
EBITDA
80
203
267
443
462
531
611
EBITDA Margin (%)
19.8
16.0
14.0
16.1
14.0
14.0
14.0
Sales Growth (%)
214
50
44
20
15
15
Domestic Ex Bright
Revenue
4,120
3,470
3,548
4,050
4,860
5,588
6,427
EBITDA
923
500
836
985
1,142
1,257
1,446
EBITDA Margin (%)
22.4
14.4
23.6
24.3
23.5
22.5
22.5
Sales Growth (%)
(16)
2
14
20
15
15
Total Domestics
Revenue
4,524
4,740
5,458
6,800
8,160
9,384 10,792
EBITDA
1,003
703
1,103
1,428
1,604
1,789
2,057
EBITDA Margin (%)
22.2
14.8
20.2
21.0
19.7
19.1
19.1
Sales Growth (%)
84
5
15
25
20
15
15
12
De-growth in domestic/
EU car volume and
slowdown in order
inflow from light
electrical segment
foreign geographies
would be the key
challenges for FY13
27 January 2012

Sintex Industries
Almost 65-70% of
composite revenue is
driven by US and
European clients - a)
foreign subsidiaries
accounts for ~64%, b)
cross-client synergy
accounts for 2-3% of
Bright's sales
Nief:
Due to higher dependence on Auto sector (27-30%), which has shown a
strong negative outlook, we model in ~10% sales de-growth in FY13, coupled with
250-300bp margin contraction. Higher contribution from electrical segment, cross-
border outsourcing synergy with Bright could ameliorate margin from current
level.
Wausaukee:
Relatively healthier trend in electrical, medical, agricultural segments;
we expect sales to witness higher resilience than Nief. We assume a flattish FY13,
albeit we do see some margin contraction. Higher capacity utilization in Wind
energy segment could improve margin.
Bright:
Again a higher dependence on domestic automobile segment would lead
to moderation in sales growth (estimated at 20% against management guidance
of 25% in FY12, and is further expected to moderate to15% in FY13). In electrical
segment too, a sharp slowdown in Schneider business, delay in order
commencement from other Nief clients (ABB, Areva etc) are likely to impact
capacity utilization and could drive margin contraction. We model in ~200bp margin
reduction over FY12-13.
Domestic car sales moderated over FY12 ('000)
Apri l
Augus t
December
Ma y
September
January
June
October
Februa ry
Jul y
November
Ma rch
…so is Europe car volume, luxury segment relatively stable (m)
EU ca r s al es
Ca r s a les Growth (%)
Luxury Car
Luxury Car s a l es Growth (%)
20
10
0
-10
-20
-30
-40
300
225
150
75
0
3.0
2.0
1.0
0.0
Global auto components sales posted declining trend
Automobi l e vehi cl e mfg
Auto Reta i l
YoY growth(%)
100
80
60
40
20
-
(20)
(40)
Auto Pa rts
80
60
40
20
-
(20)
(40)
Wind energy outlook bearish, while medical imaging
(Biotech), Agri mechanic maintained growth
Wi nd Energy
Agri Ma chi na ries
Bi otech
Aeros pace
60
30
0
-30
Source: Bloomberg/MOSL
27 January 2012
13

Sintex Industries
FY11-14E Earning CAGR estimates of key clients depicts muted outlook for Auto and relatively
brighter scenario for electrical
6%
8%
5%
4%
3%
2%
Automobiles
5%
-1%
Source: Bloomberg/MOSL
Slowdown in order inflow and lower capacity utilizations to moderate revenue growth and contract margins
Domes ti c Rev (INR m)
Forei gn Rev (INR m)
Doemes tic Ma rgi n
Forei gn Margi n
Bl ended Ma rgi n
Source: Company/MOSL
27 January 2012
14

Sintex Industries
Headwinds to moderate growth, balance sheet to improve
Deteriorating working capital in monolithic and order slowdown in custom molding could
be the key growth deterrents over 4QFY12 through 1HFY13, with some stability in
2HFY13-14. Over FY11-14, we see muted revenue CAGR of 7% and EBITDA CAGR of 3%.
However, stronger focus on receivable management, cash conservation, and lower capex
would improve FCF (cumulative INR8.1b over FY12-14) and strengthen balance sheet -
(1) this will support USD290m FCCB redemption due in Mar-13, and (2) Lower net debt-
equity to 0.3x in FY14 from 0.6x currently.
Near-term growth outlook dented considerably
We expect Sintex to post muted revenue CAGR of ~7% over FY11-14 (v/s 25% over
FY08-11), driven by 2% CAGR in monolithic construction (85% over FY08-11), 11% CAGR
in prefabricated structures (8% over FY07-11) and 8% CAGR in composites (27% over
FY08-11). With lower capacity utilization hurting margins across segments, we estimate
EBITDA CAGR of 3% and adjusted PAT CAGR at 0%.
Revenue growth moderation is largely attributable to monolithic and composites segments
Revenue (INR b)
19
17
17
16
EBITDA Ma rgi n (%)
18
17
16
17
8%
31.4
33.2
44.8
46.3
49.0
54.4
6%
2%
-1%
17%
11%
15%
2%
8%
12%
Growth CAGR
85%
FY08-11
FY11-14E
38%
11.7
22.9
Expect a de-growth in net profit over FY11-13
EBITDA
PAT
FY07
FY08
FY09
FY10
FY11
FY12E
FY13E
FY14E
FCF to improve with moderating capex, better WC management
Y/E March
2008
Cashflow before WC Change
3,491
(Inc)/Dec in WC
-1,049
CF from operations
2,442
Cepex
-11,656
Free Cash Flow
-8,984
Interest/Dividend paid
804
Inc/(Dec) in Debt
12,372
Ner cash flow
9,812
2009
5,030
-3,664
1,366
-5,286
-3,726
996
3,702
-2,028
2010
4,981
-7,480
-2,499
-2,315
-4,327
921
3,339
-2,390
2011
6,990
1,172
8,162
-8,253
99
1,295
1,434
566
2012E
6,898
-3,637
3,261
-2,982
-145
1,669
2,471
693
2013E
7,118
-3,052
4,066
-1,610
2,148
1,642
-5,342
-4,805
2014E
7,920
126
8,046
-1,903
6,143
1,708
571
5,037
15
27 January 2012

Sintex Industries
Working capital improvement process to be delayed
Over the past 3 years, sharp growth in working capital intensive monolithic business
has deteriorated operating cash flows. The net working capital (NWC) days rose from
42 in FY07 to 152 in FY10, before retreating substantially to 102 in FY11, but rising again
to 126 days in 3QFY12. However, NWC in the other verticals is relatively lower - prefab
(50-65 days), custom molding (foreign 30-40 days, domestic 50-60 days), textiles (80-
90 days), water tanks (90 days), etc.
The management aims to improve balance sheet quality by stabilizing NWC at 120-
125 days. In the backdrop of payment delays from governments, Sintex is likely to
forego some growth in monolithic segment by selectively executing only those
projects with cash flow visibility, and conserve cash for FCCB redemption due in FY13.
Even in verticals other than monolithic, Sintex is focusing on (a) stabilizing business
composition, (b) better capacity utilization and (c) greater discipline in receivables
management (e.g. use of letters of credit, dedicated relationship management with
government departments, etc).
Still, we expect NWC to stretch further to 127/143 days over FY12/13, before a possible
trend reversal in FY14.
Expect receivable days to deteriorate over FY12/13
127
113
96
73
128
116
134
127
NWC days to be stretched further
152
127
102
74
46
41
143
128
Source: Company/MOSL
But lower share of WC intensive monolithic business and lower capex commitment to improve FCF
Sal es contri buti on
32
25
16
9
10
15
30
22
28
28
29
EBITDA contri bution
Worki ng ca pi tal change
FCF
25
25
26
FY08
FY09
FY10
FY11
FY12E
FY13E
FY14E
Source: Company/MOSL
27 January 2012
16

Sintex Industries
Expect positive FCF on the back of moderated capex
We expect Sintex to generate positive free cash flow over FY12-14, largely on account
of (1) improved emphasis on working capital management, and (2) moderating capex.
Sintex has already set up enough capacity in almost all the verticals. Accordingly,
management has guided for substantial moderation in capex from the earlier planned
INR10b over the next 3 years.
We model in capex of INR3.4b in FY12 (INR1.9-2b in 1HFY12) and a total of INR3.5b
over FY13-14. Decline in capex would improve the likelihood of positive FCF; we
estimate FCF at INR8.1b over FY12-14.
FCF to improve balance sheet; FCCB redemption under control
Generation of FCF would
partly addresses the
accrual required for FCCB
redemption
In FY08, Sintex had raised USD225m of FCCBs (mainly for overseas acquisition), which
are maturing in Mar-13 with redemption value of ~USD290m. The company expects to
finance the same as follows -
1. USD110m of unused FCCBs in the form of overseas deposit;
2. USD70m from internal accruals; and
3. USD110m re-finance though ECB.
The redemption of FCCBs coupled with rising FCF would lower debt on the balance
sheet. Our estimates suggest Sintex's net DER will decline from 0.6x in FY11 to 0.3x in
FY14. Nonetheless, lower asset utilization and declining margin could dent RoE/RoCE
to 13.2%/11.4% in FY13 and 13.6%/12.8% in FY14 (v/s 20.5%/14.3% in FY11).
Du Pont: Lower assets turn and declining margins to impact RoE
FY07
Net income / PBT
0.78
Interest burden (PBT/EBIT)
0.90
EBIT margin (EBIT/Revenue)
0.16
Asset turnover (Revenue/Avg TA) 0.87
Leverage (Avg TA/Avg equtiy)
2.06
RoE (%)
20.0
RoCE (%)
15.2
FY08
0.70
0.94
0.14
0.95
2.20
19.4
14.2
FY09
0.76
1.01
0.13
0.83
2.32
19.1
12.6
FY10
0.71
1.04
0.12
0.77
2.36
15.9
10.0
FY11
0.73
0.91
0.15
0.92
2.25
20.5
14.3
FY12E FY13E FY14E
0.81
0.81
0.75
0.77
0.77
0.84
0.13
0.12
0.13
0.85
0.87
0.94
2.13
1.96
1.78
14.6
13.2
13.6
11.9
11.4
12.8
Source: Company/MOSL
Net DER to decline from 0.6x in FY11 to 0.3x in FY14
RoE/RoCE to decline to 12.6%/12.2%
RoCE
RoE
20%
16%
15%
0.3
15%
14%
13%
14%
10%
12%
11%
13%
14%
13%
0.8
0.6
0.6
0.6
0.5
20%
19%
19%
0.2
0.2
Source: Company/MOSL
27 January 2012
17

Sintex Industries
Concerns priced in; Buy with TP of INR112, 42% upside
Sintex's current valuation reflects both (1) growth moderation, and (2) other concerns
(FCCB repayment, conflict of interest in power venture).
The company is expected to generate positive FCF over FY12-14, which should boost
investors' confidence.
We value Sintex at 8x FY13E EPS to arrive at a target price of INR112, 42% upside from
current levels. Buy.
Current valuation discounts unsustainable
Historically, Sintex has traded almost at par with Midcap CNX P/E, barring recent times
when concerns over FCCB repayment, MTM forex loss and conflict of interest issue on
power venture raised the discount. At current valuation, the stock trades at 5.6x
FY13E EPS and 4.9x FY14E EPS, which we believe adequately prices in most risks and
concerns (see page 20 for details).
Historically Sintex has traded almost at par with CNX Mid-cap
30
26
22
18
14
10
6
2
Pre mi um
Si n te x
CNX Mi dca p
12
8
4
21
Long-term average P/E stands at 11.9x
35
28
P/E (x)
Avg(x)
Peak(x)
27.1
Min(x)
0
-4
-8
-12
14
7
0
11.9
4.1
4.7
Sales Growth assumptions (%)
Textiles
Plastics
Building Materials
Prefab
Monolithic
Tanks
Composites
Domestic
Foreign
FY08
10.2
126.0
68.9
38.9
18.0
267.1
83.9
FY09
6.5
39.7
22.9
1.2
115.0
-9.5
58.8
4.8
113.0
FY10
-6.7
9.3
14.5
-15.7
59.1
14.9
4.7
15.1
-0.5
FY11
25.8
37.5
50.9
14.4
86.0
22.4
24.7
24.6
24.7
Source: Company/MOSL
FY12E
FY13E
FY14E
6.0
6.0
6.0
2.9
5.9
11.6
-5.5
10.8
13.6
8.0
12.5
12.5
-15.0
10.0
15.0
15.0
10.0
10.0
12.6
1.1
9.4
20.0
15.0
15.0
8.4
-7.7
5.0
Source: Company/MOSL
FY12E
FY13E
FY14E
22.0
22.0
22.0
15.9
15.5
16.0
18.3
17.2
17.7
20.0
19.0
19.5
19.0
17.5
18.0
10.0
10.0
10.0
13.6
13.7
14.1
19.7
19.1
19.1
9.7
9.5
9.9
Source: Company/MOSL
18
EBITDA Margin assumptions (%)
Textiles
Plastics
Building Materials
Prefab
Monolithic
Tanks
Composites
Domestic
Foreign
FY08
27.6
16.1
17.2
18.6
19.0
9.0
14.8
22.2
7.3
FY09
27.8
15.5
18.1
20.1
18.0
9.0
12.5
14.8
11.4
FY10
20.0
15.9
17.1
16.6
19.0
10.1
14.8
20.2
11.7
FY11
24.0
17.5
19.0
20.5
19.5
11.0
15.0
21.0
11.6
27 January 2012

Sintex Industries
Valuing Sintex at INR112/share, 42% upside; Buy
We value Sintex at 8x FY13E EPS, which is 33% discount to its long-term average P/E,
and also 20% discount to prevailing one-year forward multiple of 10x for CNX Mid-
cap. Our target price of INR112 offers 42% upside from current levels. We re-initiate
coverage on Sintex with a Buy rating.
SOTP based value is close to our P/E-based target price
Tex tiles
Prefab
Monolithic
Tanks
Domestic Composits
Foreign Composits
Total
Net debt
Equity value
Value per share
FY13 EBITDA
1,077
1,489
2,188
251
1,789
1,132
7,925
EV
5,921
8,934
13,126
1,003
10,733
4,529
44,245
16,598
27,648
102
Source: MOSL
Remarks
Textile peers trading at average 5.5x
one year forward
Major construction companies IVRCL, HCC,
NCC trading at 5.5-6x one year forward EBITDA
Nilkamal and Supereme trading at average 4x
on one year forward EBITDA
Auto sector average 7-8x EBITDA, valuing at 6x
Auto, electrical clients average multiple 5-8x,
valuing at 6x
27 January 2012
19

Sintex Industries
Key risks and mitigants
Severe domestic and/or global slowdown
Sintex's revenue growth and EBITDA margin for 2Q/3QFY12 and the downward trend
in management guidance reflect the impact of domestic political/economic uncertainty
and global slowdown. Domestic monolithic construction is seeing delayed payments
and execution slowdown. Overseas subsidiaries are facing muted growth and
pressure on margins. If this situation prolongs, there could be downside risks to our
estimates and target price.
Mitigant: Conservative estimates
We believe we have modeled in conservative assumptions for our estimates.
Accordingly, FY11-14E CAGR for both monolithic and overseas composites revenue
works out to 2%. Further, over the period, we have assumed margin contraction of
150bp in monolithic and 170bp in overseas composites.
Deterioration in working capital, FCCB redemption, balance sheet quality
In YTDFY12, Sintex's working capital situation has deteriorated to 120+ days v/s 102
days as on March 2011. This is mainly due to (1) Rising share of working capital intensive
monolithic revenue, and (2) Delayed payments by state governments. This has caused
reversal of debt-equity correction - rising from 0.62x in March 2011 to 0.66x in
September 2011. This situation coupled with FCCB redemption (USD290m) overhang
and firm interest rates may pose risk to our estimates and target prices.
Mitigant: Management focus on cash conservation
The management has stated its current focus is on working capital management and
cash conservation through (1) selective execution in monolithic projects, (2) improving
collection efficiencies, and (3) lowering capex plan from INR10b over FY12-14. In fact,
our estimates suggest Sintex will start generating meaningful positive FCF of INR8b
over FY12-14. This should help Sintex in redeeming its FCCBs with low recourse to re-
financing (e.g. management targets ECB of USD100-110m).
Concerns on Sintex group power venture
Markets have been concerned about the Sintex group power venture at two levels.
First, that Sintex itself would invest in the project. This was categorically denied by
the management, which said that the promoters of Sintex were putting up the project
under Shirpur Power Company, where Sintex would not even invest. Once this was
clarified, the second concern was that of conflict of interest i.e. Shirpur Power place
non-remunerative EPC orders with Sintex Infra, 100% subsidiary of Sintex.
Mitigant: Sintex Infra not to compromise on margins
The management clarified that Sintex Infra will execute the INR6b order through its
associate company Durha with expected margin of 14-15%. Durha currently operates
at 18-19% margin (power vertical margin of 15-16%), and hence confident of managing
14-15% margin in the Shirpur Power order as well. Even going forward, Sintex Infra
will only consider taking power orders if margins sustain at this guided level. We
believe management's assurance on future dealing mechanism with the power
venture and expected margin reasonably mitigate the concern.
27 January 2012
20

Sintex Industries
Financials and Valuation
Income Statement
Y/E March
Operating income
Change (%)
EBITDA
EBITDA Margin (%)
Change (%)
Depreciation
EBIT
Interest
Other income
Extraordinary items
PBT
Tax
Tax / PBT (%)
PAT before MI
PAT margin (%)
Change (%)
MI + Share of profit/loss
Consolidated PAT
Adj. Con. PAT
Change (%)
2009
31,358
37.0
5,219
16.6
31.1
1,144
4,075
820
650
194
4,100
826
20.2
3,274
10.7
41.0
23
3,251
3,096
45.6
2010
33,192
5.8
5,380
16.2
3.1
1,445
3,936
731
392
486
4,083
772
18.9
3,311
10.1
1.2
21
3,290
2,896
-6.5
2011
44,837
35.1
8,155
18.2
51.6
1,491
6,664
1,089
327
190
6,092
1,508
24.8
4,584
10.2
38.4
-16
4,600
4,457
53.9
2012E
46,303
3.3
7,652
16.5
-6.2
1,711
5,941
1,448
532
-423
4,602
1,256
25.0
3,346
7.2
-27.0
30
3,316
3,739
-16.1
2013E
49,041
5.9
7,925
16.2
3.6
1,897
6,028
1,420
367
-308
4,667
1,143
24.5
3,523
7.2
5.3
30
3,493
3,801
1.7
(INR Million)
2014E
54,444
11.0
9,017
16.6
13.8
2,029
6,988
1,486
372
0
5,874
1,439
24.5
4,435
8.1
25.9
30
4,405
4,405
15.9
Balance Sheet
Y/E March
Equity share capital
Reserves
Net Worth
Minority Interest
Total Debt
Net deferred tax
Capital employed
Gross fixed assets
Less: Acc. Depn.
Net fixed assets
Goodwill
Capital WIP
Investments
Curr. assets
Inventory
Debtors
Cash & Bank
Loans, Adv. & Others
Current liab. & prov.
Creditors
Other Liabilities
Provisions
Net current assets
Misc. exp.
Total Assets
2009
271
16,778
17,049
263
22,964
1,420
41,696
23,788
6,366
17,422
2,198
2,377
1,819
27,226
3,771
8,094
11,685
3,676
9,348
5,147
518
3,683
17,878
2
41,696
2010
271
19,198
19,469
190
26,303
1,693
47,655
25,581
7,746
17,834
2,665
1,716
2,470
30,983
3,411
10,121
9,295
8,157
8,015
4,029
479
3,507
22,969
0
47,655
2011
271
23,745
24,016
0
27,738
2,057
53,811
33,276
9,156
24,120
2,190
1,363
3,775
33,007
3,770
14,229
9,861
5,147
10,644
6,522
497
3,625
22,362
0
53,811
2012E
271
26,839
27,110
30
30,209
2,062
59,412
37,999
10,867
27,132
2,190
0
3,398
37,605
4,978
16,238
10,554
5,835
10,913
7,413
0
3,500
26,692
0
59,412
2013E
271
30,111
30,383
60
24,868
2,062
57,373
39,609
12,764
26,845
2,190
0
3,398
36,325
5,988
18,004
5,749
6,584
11,385
7,885
0
3,500
24,940
(INR Million)
2014E
271
34,295
34,566
90
25,439
2,062
62,157
41,512
14,793
26,719
2,190
0
3,398
42,062
5,621
18,943
10,786
6,712
12,212
8,712
0
3,500
29,850
0
0
57,373
62,157
E: MOSL Estimates
21
27 January 2012

Sintex Industries
Financials and Valuation
Ratios
Y/E March
Basic (INR)
EPS
Growth (%)
Cash EPS
Book value
Divd. Per Share
Payout incl. Div. Tax (%)
Valuation (x)
P/E
Cash P/E
Price/Book value
EV/Sales
EV/EBITDA
Dividend yield (%)
Profitability ratios (%)
Average RoE
Average RoCE
Turnover ratios
Debtors (days sales)
Inventory (days sales)
Creditor (days total exp)
Asset turnover (x)
Leverage ratio
Debt/Equity (x)
2009
11.4
45.6
16.2
62.9
0.6
5.4
2010
10.7
-6.5
17.4
71.8
0.6
5.8
2011
16.4
53.8
22.5
88.6
0.7
4.5
2012E
13.8
-16.1
18.5
100.0
0.7
6.7
2013E
14.0
1.7
19.8
112.1
0.7
6.3
2014E
16.2
15.9
23.7
127.5
0.7
5.0
4.8
3.5
0.9
0.8
4.4
0.8
5.7
4.3
0.8
0.8
4.9
0.9
5.6
4.0
0.7
0.8
4.7
0.9
4.9
3.3
0.6
0.6
3.6
0.9
19.1
12.6
15.9
10.0
20.5
14.3
14.6
11.9
13.2
11.4
13.6
12.8
94
44
79
0.8
111
38
59
0.7
116
31
70
0.9
128
39
70
0.8
134
45
70
0.9
127
38
70
0.9
0.6
0.8
0.6
0.6
0.5
0.3
Cash Flow Statement
Y/E March
PBT before EO items
Add: Depn. & Amort.
Interest
Less: Direct taxes
(Inc)/Dec in WC
CF from operations
CF from opn. incl. EO
(Inc)/Dec in FA
(Pur)/Sale of invts.
CF from invt. activity
2009
3,883
1,153
820
826
-3,664
1,366
1,560
-6,719
1,433
-5,286
2010
3,576
1,446
731
772
-7,480
-2,499
-2,013
-1,663
-651
-2,315
-4,327
-680
3,339
-74
274
731
191
1,938
-2,390
11,685
9,295
2011
5,918
1,491
1,089
1,508
1,172
8,162
8,352
-6,948
-1,305
-8,253
99
153
1,434
-190
364
1,089
206
467
566
9,295
9,861
2012E
4,995
1,711
1,448
1,256
-3,637
3,261
2,838
-3,360
378
-2,982
-145
0
2,471
30
5
1,448
221
837
693
9,861
10,554
2013E
4,944
1,897
1,420
1,143
-3,052
4,066
3,758
-1,610
0
-1,610
2,148
0
-5,342
30
0
1,420
221
-6,953
(INR Million)
2014E
5,844
2,029
1,486
1,439
126
8,046
8,046
-1,903
0
-1,903
6,143
0
571
30
0
1,486
221
-1,106
FCF
-3,726
Inc/(Dec) in Net Worth
-1,417
Inc/(Dec) in Debt
3,702
Inc/(Dec) in Minority Int.
60
Inc/(Dec) in deferred tax liab.
350
Less: Interest paid
820
Divd & Divd Tax
177
CF from fin. activity
1,699
Inc/Dec in cash
Add: Beginning balance
Closing balance
27 January 2012
-2,028
13,713
11,685
-4,805
5,037
10,554
5,749
5,749
10,786
E: MOSL Estimates
22

Sintex Industries
N O T E S
27 January 2012
23

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