GAIL India
BSE SENSEX
24,677
S&P CNX
7,513
18 March 2016
Update
| Sector:
Oil & Gas
CMP: INR353
TP: INR376 (+6%)
Neutral
KG tariff order gives upside hopes for other networks
PNGRB implements Jan-2016 amendments; however differences on
multiple assumptions continue
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 (%)
GAIL IN
1,268.5
418/260
1/29/7
447.9
6.7
528
43.9
Financials Snapshot (INR b)
Y/E Mar
2016E 2017E 2018E
Sales
506.8 582.5 735.6
EBITDA
40.9
57.0
64.8
Adj. PAT
22.0
32.2
39.3
Adj. EPS (INR)
17.4
25.4
31.0
EPS Gr. (%)
-26.4
46.4
22.0
BV/Sh.(INR)
242.5 260.3 282.1
RoE (%)
7.3
10.1
11.4
RoCE (%)
8.9
12.4
14.0
P/E (x)
20.3
13.9
11.4
P/BV (x)
1.5
1.4
1.3
Shareholding pattern (%)
As On
Promoter
DII
FII
Others
Dec-15 Sep-15 Dec-14
56.1
23.8
17.6
2.5
56.1
23.9
17.5
2.5
56.1
20.2
21.4
2.3
Petroleum and natural Gas Regulatory Board (PNGRB) published its first final
tariff order for GAIL’s KG basin network. This tariff order was based Jan-16
regulation amendment for volume divisor and prospective applicability for
changed tariff.
PNGRB has set KG basin tariff (in INR/mmbtu) at 5.6/5.6/45.3 vs GAIL’s
demand of 5.6/181/181 for FY09-15/FY16/FY17 respectively.
However, as the current economic life of this network ends in FY17,
prospective tariff of INR45.3/mmbtu will be applicable for only one year and
tariff will be computed again from FY18 after considering ongoing capex and
extended life.
We currently model 7% increase in overall tariff and would await the tariff
orders for other pipelines before revisiting our assumptions.
KG basin tariff lower than demand; but still better than current tariff
Jan-16 amendment use a positive; await orders for other pipelines
PNGRB notified KG basin network (contributes ~6mmscd of current
97mmscmd transmission volumes) tariff at INR5.6/mmbtu for Nov 20, 2008 to
March 31, 2016 and at INR45.32/mmbtu for April 1, 2016 to Feb 11, 2017.
In May-2013, PNGRB had reduced KG basin tariff from actual INR17.4/mmbtu
to INR5.6/mmbtu. We estimate that the prospective tariff of INR45.32/mmbtu
is equivalent to ~INR9/mmbtu if it were retrospective from Nov-18.
While we already model ~7% increase in our FY17 blended tariff, the
prospective tariff of INR45.32/mmbtu for FY17 will increase EPS by ~6%.
PNGRB tariff order is based on its Jan-16 amendments for tariff calculations
for (a) volume divisor – capacity at 75% and (b) prospective applicability of
tariff for remaining life of the pipeline.
Over the last few years, PNGRB have given several provisional tariff orders for
GAIL’s pipelines. We expect the final tariff orders for these pipelines soon and
with the implementation of Jan-16 amendment expect tariffs to be higher
than provisional.
GAIL’s transmission business outlook remains challenging in the backdrop of
largely stagnant domestic production and improved economics of liquid fuels
versus natural gas. Improving viability of LNG to power sector could boost LNG
imports and inturn GAIL’s transmission volumes.
Petchem business outlook has improved post the Ras Gas long term LNG price
reset, however final product price improvement critical for meaningful profit
increase in both petchem and LPG segments.
FII Includes depository receipts
Stock Performance (1-year)
GAIL (India)
Sensex - Rebased
450
400
350
300
250
Earnings outlook mixed; recent Ras Gas reset improves petchem outlook
Harshad Borawake
(HarshadBorawake@MotilalOswal.com); +91 22 3982 5432
Rajat Agarwal
(Rajat.Agarwal@MotilalOswal.com); +91 22 3982 5558
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

GAIL India
Exhibit 1: PNGRB final tariff for KG basin network at 5.6/5.6/45.3 vs GAIL’s demand of
5.6/181/181 for FY09-15/FY16/FY17 (INR/MMBTU)
In INR/mmbtu
Tariff demanded by Gail
PNGRB tariff
180.8
180.8
45.3
5.6
FY09
5.6
FY10
5.6
FY11
5.6
FY12
5.6
FY13
5.6
FY14
5.6
FY15
5.6
FY16
FY17
Source: PNGRB, MOSL
Exhibit 2: Tariff build for GAIL demand vs PNGRB tariff - PNGRB not in agreement with GAIL on several assumptions resulting
in significantly lower tariff than demand (INR/MMBTU)
180.8
-1.8
-37.5
-6.8
+ 25.0
-91.2
GAIL
Demand
Inflation Unaccounted Working
gas
days
-2.9
-15.9
Capex
-4.3
Opex
-0.0
Work. Cap. Prospective
applicability
45.3
Volume
Tariff
Divisor applicability
from
Nov-08
PNGRB
tariff
Source: PNGRB, MOSL
Amendments notified by PNGRB on (a) volumes to be considered in divisor for tariff
calculations and (b) applicability period of the tariff
(published on January 18, 2016)
Volumes to be considered in Divisor
Volumes to be considered as divisor in tariff determination over the economic
life of the project shall be computed on a normative or actual basis, whichever is
higher.
Divisor for each of the first five years shall be arrived by multiplying the
“applicable
percentage utilization”
for the year, with 75% of the capacity (this
was 100% earlier) of natural gas pipeline as declared under the PNGRB
Regulations, 2010.
Applicable percentage utilization:
60% in Year 1, 70% in Year 2, 80% in Year 3,
90% in Year 4 and 100% in Year 5.
18 March 2016
2

GAIL India
Divisor for the sixth and the subsequent years shall be equal to the firmed up
contract capacity and booked common carrier capacity or 75% of the capacity as
declared under the PNGRB Regulations, 2010.
If the capacity has not been declared as per capacity determination regulations,
then the capacity as mentioned in the authorization/acceptance letter issued by
PNGRB shall be used for tariff determination. Subsequently when the capacity
as per PNGRB Regulations, 2010 is available, this capacity shall be replaced with
the capacity declared as per capacity determination regulations at the time of
next tariff review.
In case of addition of any new source to a natural gas pipeline that comes during
April 1, 2015 to March 31, 2010, any increase in the design capacity of the
pipeline because of this new source shall not be considered in the tariff
determination for this period.
Applicability of the tariff
Adjustment on account of variation in the provisional initial unit natural gas
pipeline tariff and final initial unit natural gas pipeline tariff shall be made in the
DCF calculations and the derived tariff shall be charged from the customers on
prospective basis till next review.
th
st
If tariff order is issued before Sept 30 , tariff shall be applicable from April 1 in
the same financial year; else tariff shall be applicable from April 1
st
of the next
financial year.
Exhibit 3: PNGRB provisional tariff has been significantly lower than demand by GAIL
Pipelines
Unit
Date Gail demand* Fixed by PNGRB Chg (%)
Natural Gas Pipelines
HVJ-DVPL network
INR/mmbtu Apr-10
35.4
25.5
-28%
DVPL/GREP upgradation
INR/mmbtu Apr-10
62.1
53.7
-14%
DUPL/DPPL Network
INR/mmbtu Feb-11
40.2
24.5
-39%
Mumbai Network
INR/mscm Mar-12
165.6
81.8
-51%
Agartala Network
INR/mscm May-12
367.2
208.8
-43%
Dadri - Bawana - Nanagal
INR/mmbtu Jul-12
27.7
11.9
-57%
KG basin network
INR/mmbtu May-13
11.8
5.6
-53%
Dabhol - Bangalore
INR/mmbtu May-14
73
45
-39%
Kochi-Mangalore-Bangalore
INR/mmbtu May-14
60
29
-52%
Chainsa Jhajjar Hissar
INR/mmbtu Jul-14
13
4
-69%
*Tariff demand in most cases was higher than actual charged
Source: PNGRB, MOSL
18 March 2016
3

GAIL India
Valuation and view
With the renegotiation of Ras-Gas contract, the contracted LNG prices have
been reduced to ~USD7/mmbtu from the prevailing price of USD12.5/mmbtu.
We expect a two-fold positive impact with (a) increased transmission volumes
and (b) lower feedstock costs for petchem.
Key events to watch out for: 1) Likelihood of transmission volume increase and
2) increase in pipeline tariffs by PNGRB.
While GAIL India’s businesses form part of a gas value chain, each business’
profitability depends on different factors, thereby making quarterly results
volatile. (a) Gas transmission growth is a function of higher gas availability, (b)
Petchem profits depends on global polymer demand-supply situation, (c) LPG
business is driven by global LPG prices and (d) gas trading profitability is a
function of management ability to manage marketing margins on LNG portfolio
without taking an inventory hit.
The stock trades at 13.9x/11.4x FY17E/FY18E EPS of INR25.4/INR31. Our SOTP-
based target price stands at INR376/sh (v/s INR373/sh earlier). Maintain
Neutral.
FY10
FY11
FY12
FY13
FY14
FY15
FY16E
FY17E
FY18E
Exhibit 4: GAIL India: Key Assumptions
FY09
Brent crude (USD/bbl)
Exchange Rate (INR/USD)
Subsidy (INRb)
Avg. Gas Price (USD/mmbtu)
Natural Gas Transmission
Total (mmscmd)
Average Tariff (INR/mscm)
LPG Transmission
Volume ('000 MT)
Average Tariff (INR/MT)
Petrochemicals
Capacity ('000 MT)
Utilization (%)
Sales ('000 MT)
Realization (USD/MT)
LPG & liq. HC
Sales ('000 MT)
LPG realization (USD/MT)
EPS (INR/sh)
84.7
46.1
17.8
3.7
84
840
2,744
1,392
410
103%
423
1,488
1,401
739
22.1
69.8
47.5
13.3
3.6
107
829
3,160
1,415
410
100%
409
1,472
1,442
607
24.8
86.7
46.0
21.1
5.0
119
888
3,337
1,422
420
100%
420
1,546
1,368
778
28.7
114.5
47.9
31.8
6.1
119
895
3,362
1,351
450
100%
448
1,589
1,439
910
28.8
110.0
54.5
26.9
6.7
105
879
3,200
937
450
95%
427
1,614
1,371
957
31.7
107.8
60.6
19.0
7.6
97
1,169
3,030
1,329
450
100%
445
1,703
1,308
936
32.6
86.0
61.1
10.0
7.0
92
960
3,094
1,424
450
98%
441
1,801
1,279
784
23.6
47.8
65.4
-
5.9
94
1,166
2,785
1,725
900
35%
318
1,420
1,127
455
17.4
45.0
67.0
(0.1)
5.7
99
1,251
2,868
1,625
900
67%
603
1,450
1,200
442
25.4
50.0
69.0
(0.1)
6.4
114
1,251
2,868
1,625
900
95%
855
1,426
1,200
457
31.0
Source: Company, MOSL
Exhibit 5: Segmental EBITDA breakdown (INR b)
Segmental EBITDA (INRb)
NG transmission
Gas trading
LPG transmission
Petrochemicals
LPG (pre-subsidy)
Others
Sub-total
Subsidy
Total
FY09
14.8
2.8
2.3
11.5
26.9
0.1
58.4
(17.8)
40.5
FY10
22.4
3.3
3.1
13.3
19.6
-1.8
59.9
(13.3)
46.7
FY11
26.5
7.3
3.3
12.5
26.4
-0.3
75.7
(21.1)
54.5
FY12
23.9
10.0
2.9
14.5
38.6
-1.1
88.8
(31.8)
57.0
FY13
22.0
12.3
1.3
14.6
41.6
-1.2
90.8
(26.9)
63.9
FY14
23.7
13.7
2.24
13.4
28.3
2.2
83.4
(19.0)
64.4
FY15
17.3
5.5
2.3
2.1
26.1
2.0
55.2
(10.0)
45.2
FY16E
22.0
10.2
2.5
-2.9
6.9
2.1
40.9
0.0
40.9
FY17E
27.1
11.0
2.1
9.0
5.5
2.1
56.9
0.1
57.0
FY18E
31.2
12.4
2.0
9.8
7.1
2.1
64.7
0.1
64.8
Source: Company, MOSL
18 March 2016
4

GAIL India
Exhibit 6: SOTP based target price stands at INR376/share
Business
PE Multiple (x)
FY18 adj. EPS
Core Business
E&P
Listed Investments
Unlisted investments
Target price
INR/sh
9.0
9x
29.8
269
7
51
19
346
Base
Case
INR/sh
10.0
10x
29.8
298
7
51
19
376
INR/sh
11.0
11x
29.8
328
7
51
19
406
INR/sh
12.0
12x
29.8
358
7
51
19
435
Remarks
10.0x FY18E adj. EPS
4 blocks valued on in-place/contingent resources
25% discount to CMP/target price
25% discount to book value
Source: MOSL
18 March 2016
5

GAIL India
Financials and Valuations
Income Statement
Y/E Mar
Net Sales
Change (%)
EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
Other Income
Extraordinary items
PBT
Tax
Tax Rate (%)
Min. Int. & Assoc. Share
Reported PAT
Adjusted PAT
Change (%)
2011
324,586
30.2
54,544
16.8
6,503
48,041
829
5,186
0
52,398
16,788
32.0
0
35,610
36,399
15.9
2012
402,807
24.1
56,981
14.1
7,907
49,074
1,165
5,491
0
53,400
16,862
31.6
0
36,538
36,538
0.4
2013
473,327
17.5
62,792
13.3
9,809
52,983
1,950
9,545
0
60,578
20,356
33.6
0
40,222
40,222
10.1
2014
572,451
20.9
67,012
11.7
11,762
55,250
3,662
8,985
3,450
64,023
20,271
31.7
0
43,753
41,310
2.7
2015
565,694
-1.2
45,237
8.0
9,743
35,494
3,613
10,334
629
42,844
12,452
29.1
0
30,392
29,947
-27.5
2016E
506,796
-10.4
40,851
8.1
12,937
27,915
6,408
9,965
0
31,472
9,442
30.0
0
22,030
22,030
-26.4
2017E
582,554
14.9
56,960
9.8
13,458
43,501
5,648
10,268
0
48,121
15,880
33.0
0
32,241
32,241
46.4
(INR Million)
2018E
735,590
26.3
64,810
8.8
13,505
51,305
4,554
11,961
0
58,712
19,375
33.0
0
39,337
39,337
22.0
Balance Sheet
Y/E Mar
Share Capital
Reserves
Net Worth
Debt
Deferred Tax
Total Capital Employed
Gross Fixed Assets
Less: Acc Depreciation
Net Fixed Assets
Capital WIP
Investments
Current Assets
Inventory
Debtors
Cash & Bank
Loans & Adv, Others
Curr Liabs & Provns
Curr. Liabilities
Provisions
Net Current Assets
Total Assets
2011
12,685
179,849
192,533
23,100
16,332
231,966
221,444
97,408
124,036
58,792
25,825
111,462
8,551
19,059
21,314
62,538
88,149
47,544
40,605
23,313
231,966
2012
12,685
203,560
216,245
53,469
17,686
287,400
263,066
104,490
158,576
79,425
35,489
117,357
14,197
21,766
9,313
72,080
103,447
59,852
43,595
13,910
287,400
2013
12,685
229,593
242,278
90,635
23,001
355,914
311,490
114,415
197,075
89,778
37,190
122,799
15,353
25,513
23,579
58,353
90,928
72,980
17,949
31,871
355,914
2014
12,685
258,039
270,723
102,973
25,664
399,360
340,563
125,797
214,766
97,279
41,030
145,039
22,548
28,120
26,510
67,861
98,754
80,224
18,530
46,285
399,360
2015
12,685
279,478
292,163
99,973
33,537
425,673
421,124
135,540
285,585
50,029
41,030
154,109
14,789
26,500
35,630
77,189
105,079
84,752
20,328
49,030
425,673
2016E
12,685
294,923
307,608
84,973
36,370
428,951
437,624
148,476
289,148
49,029
41,030
148,760
14,791
23,741
31,602
78,626
99,017
83,121
15,895
49,744
428,951
(INR Million)
2017E
12,685
317,527
330,212
69,973
41,182
441,367
466,877
161,934
304,943
36,029
41,030
164,334
16,018
27,290
40,846
80,181
104,969
90,692
14,277
59,365
441,366
2018E
12,685
345,105
357,790
54,973
47,053
459,816
475,546
175,439
300,106
46,029
41,030
196,004
18,899
34,459
60,783
81,864
123,353
106,989
16,364
72,651
459,816
18 March 2016
6

GAIL India
Financials and Valuations
Ratios
Y/E Mar
Basic (INR)
EPS
Cash EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation(x)
P/E
Adj. P/E (for investments)
Cash P/E
Price / Book Value
EV/Sales
EV/EBITDA
Dividend Yield (%)
Profitability Ratios (%)
RoE
RoCE
Turnover Ratios (%)
Debtors (No. of Days)
Fixed Asset Turnover (x)
Leverage Ratios (%)
Net Debt/Equity (x)
0.0
2011
54,544
4,359
-12,420
-14,839
-873
30,773
-46,290
-15,517
-5,095
4,090
-47,295
0
7,215
-11,094
-3,879
-20,402
41,715
21,314
0.2
2012
56,981
4,339
-5,081
-14,253
2,892
44,877
-66,182
-21,305
-9,653
4,420
-71,416
0
27,069
-12,531
14,538
-12,000
21,314
9,314
0.3
2013
62,792
7,988
-6,384
-15,129
1,067
50,334
-54,968
-4,634
-4,062
4,309
-54,722
0
32,953
-14,299
18,654
14,266
9,314
23,580
0.3
2014
67,012
8,812
-8,171
-18,738
-4,186
44,729
-38,364
6,365
114
5,933
-32,317
0
5,510
-14,991
-9,481
2,930
23,580
26,510
0.2
2015
45,237
7,349
6,376
-4,578
0
54,383
-33,311
21,072
0
0
-33,311
0
-3,000
-8,952
-11,952
9,120
26,510
35,630
0.2
2016E
40,851
3,557
-4,742
-6,609
0
33,057
-15,500
17,557
0
0
-15,500
0
-15,000
-6,585
-21,585
-4,029
35,630
31,602
0.1
2017E
56,960
4,620
-378
-11,068
0
50,134
-16,252
33,882
0
0
-16,252
0
-15,000
-9,638
-24,638
9,244
31,602
40,846
0.0
2018E
64,810
7,407
6,651
-13,504
0
65,364
-18,669
46,695
0
0
-18,669
0
-15,000
-11,759
-26,759
19,937
40,846
60,783
21
1.4
20
1.4
20
1.3
18
1.4
17
1.3
17
1.2
17
1.3
17
1.6
19.8
24.8
17.9
21.0
17.5
19.4
17.1
17.0
10.8
11.1
7.3
8.9
10.1
12.4
11.4
14.0
10.8
8.7
8.1
1.7
1.0
7.2
2.9
15.0
12.0
11.2
1.5
1.0
9.8
1.7
20.3
16.3
12.8
1.5
1.1
10.6
1.1
13.9
11.1
9.8
1.4
0.9
7.7
1.7
11.4
9.1
8.5
1.3
0.7
6.4
2.3
28.7
33.2
151.8
8.0
31.1
28.8
35.0
170.5
8.7
35.1
31.7
39.4
191.0
9.6
35.3
32.6
43.8
213.4
10.4
35.3
23.6
31.6
230.3
6.0
29.5
17.4
27.6
242.5
4.0
29.9
25.4
36.0
260.3
6.0
29.9
31.0
41.7
282.1
8.0
29.9
2011
2012
2013
2014
2015
2016E
2017E
2018E
Cash Flow Statement
Y/E Mar
Adjusted EBITDA
Non cash opr. exp (inc)
(Inc)/Dec in Wkg. Cap.
Tax Paid
Other operating activities
CF from Op. Activity
(Inc)/Dec in FA & CWIP
Free cash flows
(Pur)/Sale of Invt
Others
CF from Inv. Activity
Inc/(Dec) in Net Worth
Inc / (Dec) in Debt
Divd Paid (incl Tax) & Others
CF from Fin. Activity
Inc/(Dec) in Cash
Add: Opening Balance
Closing Balance
(INR Million)
18 March 2016
7

Disclosures
This document has been prepared by Motilal Oswal Securities Limited (hereinafter referred to as Most) to provide information about the company(ies) and/sector(s), if any, covered in the report and may be distributed by it and/or its
GAIL India
affiliated company(ies). This report is for personal information of the selected recipient/s and does not construe to be any investment, legal or taxation advice to you. This research report does not constitute an offer, invitation or
inducement to invest in securities or other investments and Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been furnished to
you solely for your general information and should not be reproduced or redistributed to any other person in any form. This report does not constitute a personal recommendation or take into account the particular investment
objectives, financial situations, or needs of individual clients. Before acting on any advice or recommendation in this material, investors should consider whether it is suitable for their particular circumstances and, if necessary, seek
professional advice. The price and value of the investments referred to in this material and the income from them may go down as well as up, and investors may realize losses on any investments. Past performance is not a guide for
future performance, future returns are not guaranteed and a loss of original capital may occur.
MOSt and its affiliates are a full-service, integrated investment banking, investment management, brokerage and financing group. We and our affiliates have investment banking and other business relationships with a some
companies covered by our Research Department. Our research professionals may provide input into our investment banking and other business selection processes. Investors should assume that MOSt and/or its affiliates are
seeking or will seek investment banking or other business from the company or companies that are the subject of this material and that the research professionals who were involved in preparing this material may educate investors
on investments in such business . The research professionals responsible for the preparation of this document may interact with trading desk personnel, sales personnel and other parties for the purpose of gathering, applying and
interpreting information. Our research professionals are paid on twin parameters of performance & profitability of MOSt.
MOSt generally prohibits its analysts, persons reporting to analysts, and members of their households from maintaining a financial interest in the securities or derivatives of any companies that the analysts cover. Additionally, MOSt
generally prohibits its analysts and persons reporting to analysts from serving as an officer, director, or advisory board member of any companies that the analysts cover. Our salespeople, traders, and other professionals or affiliates
may provide oral or written market commentary or trading strategies to our clients that reflect opinions that are contrary to the opinions expressed herein, and our proprietary trading and investing businesses may make investment
decisions that are inconsistent with the recommendations expressed herein. In reviewing these materials, you should be aware that any or all of the foregoing among other things, may give rise to real or potential conflicts of interest.
MOSt and its affiliated company(ies), their directors and employees and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and buy or sell the securities or derivatives thereof of companies
mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an
advisor or lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing
whatsoever on the specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the affiliates of MOSt even though there might exist an inherent
conflict of interest in some of the stocks mentioned in the research report .Reports based on technical and derivative analysis center on studying charts company's price movement, outstanding positions and trading volume, as
opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamental analysis. In addition MOST has different business segments / Divisions with independent research
separated by Chinese walls catering to different set of customers having various objectives, risk profiles, investment horizon, etc, and therefore may at times have different contrary views on stocks sectors and markets.
Unauthorized disclosure, use, dissemination or copying (either whole or partial) of this information, is prohibited. The person accessing this information specifically agrees to exempt MOSt or any of its affiliates or employees from,
any and all responsibility/liability arising from such misuse and agrees not to hold MOSt or any of its affiliates or employees responsible for any such misuse and further agrees to hold MOSt or any of its affiliates or employees free
and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The information contained herein is based on publicly available data or other
sources believed to be reliable. Any statements contained in this report attributed to a third party represent MOSt’s interpretation of the data, information and/or opinions provided by that third party either publicly or through a
subscription service, and such use and interpretation have not been reviewed by the third party. This Report is not intended to be a complete statement or summary of the securities, markets or developments referred to in the
document. While we would endeavor to update the information herein on reasonable basis, MOSt and/or its affiliates are under no obligation to update the information. Also there may be regulatory, compliance, or other reasons that
may prevent MOSt and/or its affiliates from doing so. MOSt or any of its affiliates or employees shall not be in any way responsible and liable for any loss or damage that may arise to any person from any inadvertent error in the
information contained in this report. MOSt or any of its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the
implied warranties of merchantability, fitness for a particular purpose, and non-infringement. The recipients of this report should rely on their own investigations.
This report is intended for distribution to institutional investors. Recipients who are not institutional investors should seek advice of their independent financial advisor prior to taking any investment decision based on this report or for
any necessary explanation of its contents.
Most and it’s associates may have managed or co-managed public offering of securities, may have received compensation for investment banking or merchant banking or brokerage services, may have received any compensation
for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past 12 months.
Most and it’s associates have not received any compensation or other benefits from the subject company or third party in connection with the research report.
Subject Company may have been a client of Most or its associates during twelve months preceding the date of distribution of the research report
MOSt and/or its affiliates and/or employees may have interests/positions, financial or otherwise of over 1 % at the end of the month immediately preceding the date of publication of the research in the securities mentioned in this
report. To enhance transparency, MOSt has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report.
Motilal Oswal Securities Limited is registered as a Research Analyst under SEBI (Research Analyst) Regulations, 2014. SEBI Reg. No. INH000000412
There are no material disciplinary action that been taken by any regulatory authority impacting equity research analysis activities
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or
indirectly related to the specific recommendations and views expressed by research analyst(s) in this report. The research analysts, strategists, or research associates principally responsible for preparation of MOSt research receive
compensation based upon various factors, including quality of research, investor client feedback, stock picking, competitive factors and firm revenues
Disclosure of Interest Statement
Analyst ownership of the stock
Served as an officer, director or employee
GAIL INDIA LTD
No
No
A graph of daily closing prices of securities is available at www.nseindia.com and http://economictimes.indiatimes.com/markets/stocks/stock-quotes
Regional Disclosures (outside India)
For U.S.
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which
would subject MOSt & its group companies to registration or licensing requirements within such jurisdictions.
Motilal Oswal Securities Limited (MOSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state laws in the United States. In addition MOSL is not a
registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the
absence of specific exemption under the Acts, any brokerage and investment services provided by MOSL, including the products and services described herein are not available to or intended for U.S. persons.
This report is intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional investors"). This
document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major institutional investors and will be
engaged in only with major institutional investors. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and interpretations thereof by
the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOSL has entered into a chaperoning agreement with a U.S. registered broker-dealer, Motilal Oswal
Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer, MOSIPL, and therefore,
may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research analyst account.
For Hong Kong:
This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong Kong Securities and Futures Commission (SFC)
pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH000000412) has an agreement with
Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of research report in Kong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any
investment or investment activity to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these securities, products and
services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For Singapore
Motilal Oswal Capital Markets Singapore Pte Limited is acting as an exempt financial advisor under section 23(1)(f) of the Financial Advisers Act(FAA) read with regulation 17(1)(d) of the Financial Advisors Regulations and is a
subsidiary of Motilal Oswal Securities Limited in India. This research is distributed in Singapore by Motilal Oswal Capital Markets Singapore Pte Limited and it is only directed in Singapore to accredited investors, as defined in the
Financial Advisers Regulations and the Securities and Futures Act (Chapter 289), as amended from time to time.
In respect of any matter arising from or in connection with the research you could contact the following representatives of Motilal Oswal Capital Markets Singapore Pte Limited:
Kadambari Balachandran
Email : kadambari.balachandran@motilaloswal.com
Contact : (+65) 68189233 / 65249115
Office Address : 21 (Suite 31),16 Collyer Quay,Singapore 04931
Motilal Oswal Tower, Level 9, Sayani Road, Prabhadevi, Mumbai 400 025
Phone: +91 22 3982 5500 E-mail: reports@motilaloswal.com
Motilal Oswal Securities Ltd
18 March 2016
8