Indo Count Industries
BSE SENSEX
27,836
Bloomberg
Equity Shares (m)
M.Cap.(INR b)/(USD b)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val. (INR m)
Free float (%)
S&P CNX
8,592
ICNT IN
39.5
33.8 / 0.5
1,248/720
-2/-17/-10
77
41.1
25 August 2016
1QFY17 Results Update | Sector: Textiles
CMP: INR856
TP: INR1,321 (+54%)
Buy
Laying foundations for long-term growth
Results below expectations:
Indo Count Industries’ (ICNT) 1QFY17 revenues
rose 7.6% to INR4.9b (est. of INR5.4b) from INR4.6b in 1QFY16. Volumes grew
7.3% to 13.46m mtrs from 12.54m mtrs in 1QFY16. EBITDA grew 9% to
INR1,103m (est. of INR1,257m) from INR1,012m in 1QFY16. EBITDA margin
rose 30bp to 22.4% (est. of 23.3%) from 22.1% in 1QFY16. Gross margin fell
270bp to 48.3%, offset by a 350bp fall in other expenses to 20.5% from 24% in
1QFY16. Consequently, PAT grew 15.6% YoY to INR603m (est. INR729m).
No material impact of cotton prices on gross margins:
Cotton prices have
increased ~10% over the past few months; however, management mentioned
it has enough raw material inventory to sustain till October. Globally, cotton
prices have corrected over the past month, and this trend is expected to flow
in India too. ICNT may re-consider pricing with customers if cotton prices
remain at this level or increase further in October-November. It may also pass
on price the increase to customers to sustain gross margin levels.
Move toward B2C and expansion to aid long-term sustainability:
Recently, the
company had launched three propriety bed linen brands in fashion and utility
bedding, which we believe will help ICNT transform from a B2B to a B2C player,
thus commanding higher prices and margins. Management highlights total
capex of INR4.25b (ex-effluent treatment) to generate 2-2.5x revenues. Entire
capacity expansion plans should be completed by FY18, thus contributing to
revenues from FY19. It expects revenues of INR9-10b with 23-25% EBITDA
margins at full utilization, aiding long-term sustainability.
Valuation and view:
We slightly cut FY17E/ FY18E PAT by 4.5% due to its
weak-than-expected 1QFY17 results. With a unique asset light business model,
ICNT enjoys robust capital efficiency. With its foray into products like fashion,
institutional linen and utility bedding, we expect 17% revenue CAGR and 28%
PAT CAGR over FY16-18. Maintain
Buy
with TP of INR1,321 (12x FY18E EPS).
FY17
2QE
3QE
6,753 6,031
16.0
20.0
5,254 4,668
1,499 1,363
22.2
22.6
56
59
89
90
4
6
1,358 1,220
502
402
37.0
32.9
856
818
856
818
64.1
24.1
12.7
13.6
FY16
4QE
6,300
20.0
4,845
1,455
23.1
60
84
6
1,317
442
33.5
876
876
38.0
13.9
22,128
24.2
17,393
4,735
21.4
189
549
0
3,998
1,329
33.3
2,668
2,668
62.9
12.1
FY17E
25,082
13.4
19,439
5,643
22.5
251
351
21
5,063
1,671
33.0
3,392
3,392
27.1
13.5
(INR Million)
FY17
Var
1QE
%
5,394
-9
17.0
4,137
1,257
-12
23.3
58
88
5
1,116
-17
387
34.6
729
-17
729
-17
31.7
13.5
Financials & Valuations (INR b)
Y/E Mar
Net Sales
EBITDA
PAT
EPS (INR)
Gr. (%)
BV/Sh (INR)
RoE (%)
RoCE (%)
P/E (x)
P/BV (x)
2016 2017E 2018E
22.1
4.7
2.7
67.6
62.9
166.1
49.4
50.3
12.7
5.2
25.1
5.6
3.4
85.9
27.1
255.5
40.8
32.3
10.0
3.4
30.1
7.0
4.3
110.0
28.1
370.2
35.2
31.5
7.8
2.3
Estimate change
TP change
Rating change
Standalone - Quarterly Earning Model
Y/E March
Net Sales
YoY Change (%)
Total Expenditure
EBITDA
Margins (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Reported PAT
Adj PAT
YoY Change (%)
Margins (%)
E: MOSL Estimates
1Q
4,579
44.9
3,567
1,012
22.1
67
146
0
798
277
34.6
522
522
109.4
11.4
FY16
2Q
3Q
5,821 5,026
21.6
17.3
4,577 3,942
1,245 1,084
21.4
21.6
44
45
155
93
0
0
1,046
946
387
311
37.0
32.9
659
634
659
634
55.1
45.4
11.3
12.6
4Q
5,250
15.0
4,087
1,163
22.2
51
119
0
993
333
33.5
660
660
44.5
12.6
1Q
4,926
7.6
3,824
1,103
22.4
80
98
0
924
321
34.8
603
603
15.6
12.2
Niket Shah
(Niket.Shah@MotilalOswal.com); +91 22 3982 5426
Chintan Modi
(Chintan.Modi@MotilalOswal.com); +91 22 3982 5422
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.

Indo Count Industries
Results below estimates
ICNT’s revenue grew 7.6% YoY to INR4.9b (est. INR5.4b) in 1QFY17 on the back
of a 7.3% volume growth from 12.46m meters to 13.46m meters on a YoY basis.
EBITDA grew 9% YoY to INR1,103m (est. INR1,257m). EBITDA margins expanded
30bp—from 22.1% in 1QFY16 to 22.4% (est. 23.3%) in 1QFY17. Gross margins
declined by 270bp to 48.3% due to change in product mix which was offset by
lower other expenses by 350bp at 20.5% vs 24% in 1QFY16 due to operational
efficiency.
Interest costs stood at INR98m v/s INR146m in 1QFY16.
PAT for the quarter was up 15.6% YoY to INR603m (est. INR729m).
Net debt declined from INR3b in 1QFY16 to INR 2.3b in 1QFY17 while Net
Debt/Equity ratio improved from 0.8 to 0.34 YoY.
Exhibit 1: Revenue trend
Revenues (INR m)
42%
38%
30%
21%
3,521
2%
2,959 4,289 3,740
3,161
7%
12%
22%
15%
17%
15%
8%
4,926
Growth (%)
45%
4,788 4,284 4,567 4,579 5,821 5,026 5,250
Source: MOSL, Company
Exhibit 2: EBITDA trend
EBITDA (INR m)
16% 17%
12% 11% 13% 14%
19% 19%
Margins (%)
22% 21% 22% 22% 22%
Exhibit 3: PAT trend
PAT (INR m)
Growth (%)
659 634 660
603
254
138
366 292
249
425 436 457
522
Source: MOSL, Company
Source: MOSL, Company
Key highlights from the conference call:
Revenue growth of 7.6% is mainly because of new customer addition, enhanced
customer wallet share. There has been volume growth of 7.3% in this quarter
from 12.46m meters to 13.46m meters on a YoY basis. Also, Gross margin has
been impacted in this quarter due to change in product mix while other
expenses have reduced due to operational efficiencies coming in leading to
expansion in EBITDA margins by 30bp to 22.4%.
The management is expecting revenue growth of 12%-15% in FY17 with a 10%-
12% volume growth. Top 10 customers account for ~50% of revenues for ICNT.
25 August 2016
2

Indo Count Industries
Company adds about 8-10 customers annually, with 4-5 in US and balance
across other markets. In FY16 it has retained all its customers. It is exploring
newer geographies too for acquiring new customers.
Company derived 65% of revenues from USA. It markets products in 54
countries currently and key non-US markets are UK, Canada, Europe, MENA and
Australia.
Term debt (long term borrowings) stood at INR485m v/s INR574.7 as at FY16
and 697m as at 1QFY16. While net debt stood at INR2.3b v/s INR3.05b in
1QFY16.
Cotton prices have increased by ~10% in last few months, however the
management believes that it has enough raw material to sustain till October and
believes prices should correct. Internationally, cotton prices have seen a
correction in last one month and this trend is expected to flow in India too. ICNT
may re-consider their pricing with customer if cotton prices remain at this level
or increase further in October-November and may pass on price increase to
customers.
The management believes that ~12%-13% of revenues come from branded
cotton (includes Supima, organic, Egyptian etc). Target constitutes less than 5%
of revenues for ICNT and there is no supply of Egyptian cotton to it from the
company.
Company’s plan for FY17 – introduce bed linen brands in India, US, Australia,
Japan and UK, strengthen customer mix, increase asset utilization, enhance
margins and domestic market launch.
ICNT has acquired 82.5% stake in Indo Count Ventures Private Ltd (ICRVPL) and
thus ICRVPL is now a subsidiary of the company w.e.f 24th August, 2016. Paid-
up share capital for ICRVPL is Rs0.1m and has zero turnover currently as it is yet
to commence operations.
Company has an order book visibility of six months as of now.
Domestic branded retail entry is planned through a subsidiary company with
INR250m investment across three years. Company plans to introduce its own
brand – ‘Boutique Living’.
Management highlights EBITDA margins of FY16 are sustainable for FY17 as well.
Moving towards B2C from B2B
The company in 4QFY16 had launched three propriety bed linen brands in
fashion and utility bedding – ‘Boutique Living’, ‘Revival’ and ‘The Pure
Collection’ that signify increased focus on B2C.
Launched initially in US targeting mid to high segment, these brands will soon be
offered in other markets in the world.
Advertising and marketing for these have already begun and has generated
positive response, as per management. ICNT also expects to license certain
brands in the next six months.
It has taken on-board dedicated designers for these brands to tap the premium
segment.
Margins in owned brands are expected to be higher by 100-200bp.
We believe company is on the right track from being a B2B player to B2C
commanding higher prices and margins, given the aggressive expansion plan
25 August 2016
3

Indo Count Industries
geared towards high value fashion and utility bedding and launch of own
brands.
ICNT is also planning to license certain brands in the next few months.
The decision to launch 3 new brands is in line with the company’s intent to focus
on increasing the share of fashion and utility bedding.
Branded sales – whether in-licensed or owned brands will be on made to order
basis only.
Capex plans on track, aggressive expansion
ICNT in 1HFY16 announced capex plans of INR1.75b for increasing processing
capacity to 90m metres (INR700m) from 68m metres (on track for completion
by 4QFY17), setting up a water effluent treatment plant (INR500m) and towards
automation of cut, sew and warehousing (INR600m).
ICNT further also announced capex plans of INR3b funded through internal
accruals and debt for upgrading existing spinning, investments in weaving with
specialized looms and value added equipments for fashion and utility bedding,
all of which shall be ready by FY18.
ICNT is also expanding weaving capacity (currently 9m metres) to 25-27m
metres for servicing the increased processing capacity.
Management highlights total capex of INR4.25b (ex-effluent treatment) to
generate 2-2.5x revenues. Entire capacity expansion plans should be done by
FY18, thereby contributing to revenues from FY19. It expects revenues of INR9-
10b with 23-25% EBITDA margins on a full-blown basis.
US Fashion, Utility and Institutional Bedding market is USD10b. India’s share is
minuscule. China’ share is highest at 85%. So management highlights that a
market opportunity exists. Currently, these segments constitute 10% of ICNT
revenues; company expects to increase to 30% in next few years.
Exhibit 4: Capacity expansion and utilization
Installed Capacity (m mtrs)
98
79
46
47
57
68
77
79
66
90
78
Capacity utilization
90
36
FY10
36
FY11
36
FY12
37
FY13
45
FY14
45
FY15
FY16
FY17E
FY18E
Source: MOSL, Company
25 August 2016
4

Indo Count Industries
Valuation and view
With a unique asset-light business model, ICNT enjoys robust and best in class
capital efficiency.
With aggressive capacity expansion plans, foray into newer products like
fashion, institutional linens and utility bedding, we believe ICNT has strong room
for growth.
We expect ICNT to post 17% revenue CAGR and 28% PAT CAGR over FY16-18.
With robust return ratios, reducing debt and leadership in the bed sheet market,
we believe valuations at 10x FY17E and 8x FY18E are attractive, and re-rating
should continue. We reiterate
‘Buy’
rating and a PT of INR1,321 (12x FY18 EPS).
Exhibit 6: Price to book (one year forward)
6.0
5.0
4.0
3.0
2.0
1.0
0.0
0.8
1.5
0.9
P/B (x)
5 Yrs Avg(x)
12 Yrs Avg(x)
10 Yrs Avg(x)
Exhibit 5: Price to earnings (one year forward)
20
16
12
8
4
0
Negative
Earnings
Cycle
P/E (x)
5 Yrs Avg(x)
12 Yrs Avg(x)
10 Yrs Avg(x)
5.4
4.0
4.5
8.7
2.8
Source: MOSL, Company
Source: MOSL, Company
25 August 2016
5

Indo Count Industries
Story in charts
Exhibit 7: India’s share in home textiles increasing
India
18
26
29
27
2009
16
21
30
33
2010
China
16
22
24
38
2011
Pakistan
15
18
22
45
2012
RoW
13
17
24
47
2013
13
17
23
47
2014
Alok Industries
Indo Count
Welspun
Source: MOSL, Company
Exhibit 8: Largest capacity in home textiles among peers
(FY15)
105
68
60
Source: MOSL, Company
Exhibit 9: Share from home textiles on an uptrend
Spinning
10%
56%
16%
Home Textile
20%
10%
9%
Consumer Goods
3%
0%
0%
0%
Exhibit 10: Net debt free by FY18
Net Debt to Equity (x)
1.7
1.8
1.8
1.9
2.1
1.4
52%
50%
61%
63%
71%
79%
79%
81%
0.8
0.5
0.2
0.1
26%
25%
21%
21%
20%
16%
12%
11%
9%
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17E FY18E
Source: MOSL, Company
FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17E FY18E
Source: MOSL, Company
Exhibit 11: Robust RoCEs
RoCE (x)
33.6
23.5
14.6
6.0
27.3
32.3
31.5
Exhibit 12: Highest RoCE among peers due to asset light
model – FY15
RoCE (%)
27
24
10
11
FY12
FY13
FY14
FY15
FY16
FY17E
FY18E
Indo Count
Welspun
Trident
Alok
Source: MOSL, Company
Source: MOSL, Company
25 August 2016
6

Indo Count Industries
Exhibit 13: Key assumptions (INR m)
FY12
Installed Capacity (m mtrs)
Spinning (MT)
Processing - Home textiles (m mtrs)
Capacity utilization (%)
Spinning (MT)
Processing - Home textiles (m mtrs)
Revenues (INR m)
Spinning Division
Home Textile
Consumer Goods
EBITDA (INR m)
Spinning Division
Home Textile
Consumer Goods
8,003
36
FY13
9,983
37
FY14
10,346
45
FY15
10,556
45
FY16
10,556
68
FY17E
10,556
90
FY18E
10,556
90
78
57
8,071
1,731
4,701
1,640
630
(107)
651
87
92
79
12,171
2,502
8,412
1,257
1,200
155
980
65
96
77
14,979
3,027
10,649
1,303
1,892
191
1,657
44
96
98
17,818
2,819
14,509
490
3,137
136
2,987
13
95
79
22,128
2,607
17,428
-
4,574
130
4,444
-
96
66
25,082
2,769
19,801
-
5,485
138
5,346
-
96
78
30,001
2,825
24,287
-
6,699
141
6,558
-
25 August 2016
7

Indo Count Industries
Financials and Valuations
Income Statement
Y/E March
Total Income from Operations
Change (%)
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income
PBT bef. EO Exp.
EO Items
PBT after EO Exp.
Current Tax
Deferred Tax
Tax Rate (%)
Reported PAT
Adjusted PAT
Change (%)
Margin (%)
(INR Million)
FY12
8,071
10.1
630
7.8
186
444
352
0
92
-123
-31
3
-11
25.7
-22
70
-47.7
0.9
FY13
12,171
50.8
1,200
9.9
185
1,015
498
0
517
-157
361
14
52
18.2
293
421
502.5
3.5
FY14
14,979
23.1
1,892
12.6
196
1,696
499
0
1,197
0
1,197
12
81
7.8
1,100
1,100
161.0
7.3
FY15
17,818
19.0
3,136
17.6
160
2,977
650
0
2,327
-257
2,069
506
104
29.5
1,457
1,638
49.0
9.2
FY16
22,128
24.2
4,735
21.4
189
4,547
549
0
3,998
0
3,998
1,189
141
33.3
2,668
2,668
62.9
12.1
FY17E
25,082
13.4
5,643
22.5
251
5,392
351
21
5,063
0
5,063
1,671
0
33.0
3,392
3,392
27.1
13.5
FY18E
30,099
20.0
6,983
23.2
304
6,679
221
27
6,484
0
6,484
2,140
0
33.0
4,344
4,344
28.1
14.4
Consolidated - Balance Sheet
Y/E March
Equity Share Capital
Preference Capital
Total Reserves
Net Worth
Minority Interest
Deferred Liabilities
Total Loans
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Provisions
Net Current Assets
Deferred Tax assets
Appl. of Funds
E: MOSL Estimates
FY12
355
25
1,409
1,789
11
364
3,554
5,718
6,057
2,406
3,651
49
2,864
1,481
586
71
727
1,475
1,475
0
1,389
628
5,718
FY13
355
25
1,576
1,956
13
368
4,110
6,447
6,301
2,706
3,596
18
4,567
2,458
879
86
1,144
2,314
2,257
57
2,253
580
6,447
FY14
355
25
2,537
2,917
55
368
4,341
7,680
6,422
2,958
3,464
3
6,511
3,457
1,087
313
1,654
2,797
2,514
283
3,714
500
7,680
FY15
395
25
3,819
4,239
57
432
3,859
8,587
7,065
3,181
3,884
146
8,389
3,830
1,270
508
2,781
3,894
3,163
731
4,495
62
8,587
FY16
395
0
6,161
6,556
57
511
3,421
10,544
8,317
3,370
4,947
0
9,304
4,564
2,058
296
2,387
3,707
2,830
877
5,598
0
10,545
(INR Million)
FY17E
395
0
9,692
10,086
57
511
2,421
13,075
9,617
3,621
5,996
205
10,854
4,683
1,787
380
4,004
3,979
3,068
911
6,874
0
13,075
FY18E
395
0
14,219
14,614
57
511
1,421
16,603
12,117
3,925
8,191
246
12,693
5,560
2,144
184
4,805
4,528
3,451
1,077
8,165
0
16,603
25 August 2016
8

Indo Count Industries
Financials and Valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
RoIC
Working Capital Ratios
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Leverage Ratio (x)
Debt/Equity
FY12
2.0
7.2
50.4
0.0
0.0
FY13
11.9
17.1
55.1
0.0
0.0
FY14
31.0
36.5
82.2
0.0
0.0
FY15
41.5
45.5
107.4
0.0
0.0
20.6
18.8
8.0
2.1
11.8
0.0
3.8
6.0
5.8
1.4
67
26
100
2.0
FY12
-37
186
349
-11
99
584
-134
451
-97
354
0
137
40
25
-244
-352
0
-1
-572
-81
153
71
22.5
14.6
13.9
1.9
74
26
112
2.1
FY13
338
185
497
0
-772
247
-60
187
0
187
1
-152
-151
0
476
-498
-1
2
-22
15
71
86
45.1
23.5
22.8
2.0
84
26
103
1.5
FY14
1,174
196
498
-231
-1,096
540
-198
342
13
354
-22
27
18
0
314
-499
-1
54
-133
227
86
313
45.8
27.3
27.4
2.1
78
26
122
0.9
FY15
2,025
160
649
-487
-158
2,188
174
2,362
-853
1,510
0
-175
-1,028
40
-528
-650
-1
-1
-1,139
195
313
508
FY16
67.6
72.4
166.1
2.0
3.5
12.7
11.8
5.2
1.7
7.8
0.2
49.4
33.6
33.4
2.1
75
34
99
0.5
FY16
3,998
189
549
-1,189
-1,315
2,232
0
2,232
-1,106
1,126
0
0
-1,105
0
-438
-549
92
-444
-1,339
-212
508
296
FY17E
85.9
92.3
255.5
3.0
4.1
10.0
9.3
3.4
1.4
6.3
0.4
40.8
32.3
31.8
1.9
68
26
95
0.2
FY17E
5,063
251
351
-1,671
-1,192
2,801
0
2,801
-1,505
1,296
0
0
-1,505
0
-1,000
-351
139
0
-1,212
84
296
380
FY18E
110.0
117.7
370.2
4.0
4.2
7.8
7.3
2.3
1.2
5.0
0.5
35.2
31.5
31.2
1.8
67
26
90
0.1
Cash Flow Statement
Y/E March
OP/(Loss) before Tax
Depreciation
Interest & Finance Charges
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
Others
CF from Operating incl EO
(inc)/dec in FA
Free Cash Flow
(Pur)/Sale of Investments
Others
CF from Investments
Issue of Shares
(Inc)/Dec in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Opening Balance
Closing Balance
E: MOSL Estimates
(INR Million)
FY18E
6,484
304
221
-2,140
-1,487
3,383
0
3,383
-2,541
842
0
0
-2,541
0
-1,000
-221
183
0
-1,038
-196
380
184
25 August 2016
9

Indo Count Industries
Corporate profile
Company description
Indo Count Industries Ltd (ICNT) is focused player
on bedding—a niche segment of home textile
market, which formed 81% of revenues in FY15. It’s
other two segments spinning and consumer goods
contributed 16% and 3% respectively. In terms of
EBITDA, home textiles contributed 95% of total
EBITDA in FY15.With a unique asset-light business
model, ICNT enjoys robust and best in class capital
efficiency (40% RoCE). Entry in newer products
expands opportunity by 3x to USD13b.
Exhibit 1: Sensex rebased
Source: MOSL/Bloomberg
Exhibit 2: Shareholding pattern (%)
Jun-16
Promoter
DII
FII
Others
59.0
1.8
14.3
25.0
Mar-16
59.0
1.7
13.3
26.1
Jun-15
59.0
1.8
7.0
32.3
Source: Capitaline
Exhibit 3: Top holders
Holder Name
Elm Park Fund Limited
Amruit Promoters And Finance LLP
Uniworth Finance And Securities Pvt Ltd
Lazard Emerging Markets Small Cap Equity
Trust
Goldman Sachs India Fund Limited
% Holding
6.9
1.5
1.5
1.4
1.1
Source: Capitaline
Note: FII Includes depository receipts
Exhibit 4: Top management
Name
Anil Kumar Jain
Mohit Kumar Jain
K R Lalpuria
Amruta Avasare
Designation
Executive Chairman
Managing Director
Executive Director
Company Secretary
Exhibit 5: Directors
Name
Anil Kumar Jain
Mohit Kumar Jain
K R Lalpuria
Dilip J Thakkar*
P N Shah*
Name
Prem Malik*
R Anand*
Sushil Kumar Jiwarajka*
Vaijayanti Pandit*
Kamal Mitra
Source: Capitaline
*Independent
Exhibit 6: Auditors
Name
B K Shroff & Co
S Anantha & Co
Suresh Kumar Mittal & Co
Type
Statutory
Secretarial Audit
Internal
Exhibit 7: MOSL forecast v/s consensus
EPS
(INR)
MOSL
forecast
85.9
110.0
Consensus
forecast
83.5
101.5
Variation
(%)
2.8
8.4
Source: Bloomberg
FY17
FY18
Source: Capitaline
25 August 2016
10

INDO COUNT INDUSTRIES GALLERY
ICNT

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
Count Industries
Indo
may be distributed by it and/or
its 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
Pending Regulatory inspections against Motilal Oswal Securities Limited:
SEBI pursuant to a complaint from client Shri C.R. Mohanraj alleging unauthorized trading, issued a letter dated 29th April 2014 to MOSL notifying appointment of an Adjudicating Officer as per SEBI regulations to hold inquiry and
adjudge violation of SEBI Regulations; MOSL replied to the Show Cause Notice whereby SEBI granted us an opportunity of Inspection of Documents. Since all the documents requested by us were not covered we have requested
to SEBI vide our letter dated June 23, 2015 to provide pending list of documents for inspection.
List of associate companies of Motilal Oswal Securities Limited -
Click here to access detailed report
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 -
INDO COUNT INDUSTRIES
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)
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.
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 U.S.
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 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:
Varun Kumar
Varun.kumar@motilaloswal.com
Contact : (+65) 68189232
Office Address:21 (Suite 31),16 Collyer Quay,Singapore 04931
Kadambari Balachandran
kadambari.balachandran@motilaloswal.com
(+65) 68189233 / 65249115
25 August 2016
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
12