Initiating Coverage | 23 August 2017
Sector: Textile
Trident
Utilization
TRIDENT is a three-pronged weapon, which, among
other things, represents three energy sources that
combine to create a positive outlook.
An attractive utilization play
Niket Shah - Research analyst
(Niket.Shah@MotilalOswal.com); +91 22 3982 5426
Aksh Vashishth - Research analyst
(Aksh.Vashishth@MotilalOswal.com); +91 22 6129 1553
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.

Trident
Contents: Trident Ltd. | An attractive utilization play
Summary ............................................................................................................. 3
Company overview............................................................................................... 6
Home Textiles – the key to improved profitability ................................................. 8
Branded copier paper to drive margins ............................................................... 11
Culminating capex cycle...................................................................................... 13
Earnings to post 24% CAGR over FY17–20 ........................................................... 15
Valuation and view............................................................................................. 17
Bull & Bear case
................................................................................................. 19
Industry overview .............................................................................................. 21
Key risks............................................................................................................. 24
Management overview....................................................................................... 25
Financials and valuations .................................................................................... 26
23 August 2017
2

Trident
Initiating Coverage | Sector: Textiles
Trident
Buy
BSE Sensex
31,292
S&P CNX
9,766
CMP: INR82
TP: INR114 (+39%)
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
M.Cap. (INR b)
M.Cap. (USD b)
1, 6, 12 Rel. Per (%)
Avg Val, (INR m)
Free float (%)
Financial Snapshot (INR b)
Y/E Mar
2017 2018E
Sales
47.4
52.2
EBITDA
8.9
9.9
NP
3.4
4.2
EPS (INR)
6.6
8.3
EPS Gr (%)
39.3
25.2
BV/Sh (INR)
54.1
60.5
RoE (%)
13.0
14.5
RoCE (%)
7.5
9.0
P/E (x)
12.4
9.9
P/BV (x)
1.5
1.4
Shareholding pattern (%)
As On
Promoter
DII
FII
Others
TRID IN
509.4
92/45
41.7
0.7
-3/9/62
129
32.2
2019E
57.1
11.1
5.3
10.4
25.5
68.6
16.1
10.9
7.9
1.2
Trident (TRID) is one of India’s leading diversified group of businesses headquartered
in Ludhiana, Punjab. The company is one of the world’s largest manufacturers of
integrated home textile (bed and bath linen) and the largest manufacturer of wheat
straw-based paper. In FY17, the Home Textile business contributed 82% of its overall
revenue, while Paper accounted for 18%. It has manufacturing plants at Budni (MP)
and Barnala (Punjab) with combined installed capacity of 115mn kg of yarn, 175k MT
of paper, 90MT of bath linen and 43m mtrs of bed linen. TRID also owns the world’s
largest compact yarn spinning unit under single roof.
An attractive utilization play
Increasing utilization and entry into bed linen – the key growth drivers
Jun-17 Mar-17 Jun-16
67.8
2.1
1.5
28.6
67.8
2.2
1.6
28.5
66.5
1.6
1.0
30.9
Home Textile contributes 82% of TRID’s revenues. Improving productivity and
operating efficiencies are expected to significantly boost utilization in this
segment over the coming years (65% utilization in its stronghold bath linen v/s
current level of 50%, and 60% utilization in the recently forayed bed linen v/s
current level of 29%). The focus on value-added products should help the
company improve realization impressively in Home Textile.
Paper accounts for 18% of its revenues. The company has presence in copier
paper (~60% of TRID’s Paper sales volume), which is among the top-selling brands
in India and commands high margins. TRID plans to implement a debottlenecking
project to release capacity of 250-275 TPD, improving capacity utilization and
allowing further expansion in the copier segment. Increased focus on copier
paper is expected to expand TRID’s Paper margin by 340bp to 38% in FY20E.
We estimate a CAGR of 9% in revenue and 24% in PAT over FY17-20, driven by
EBITDA margin expansion of 110bp and lower interest expense. We value the
stock at 11x FY19E EPS. We initiate coverage with a Buy rating and a target price
of INR114, implying 39% upside.
Margin expansion in Paper business led by copier
Copier paper is among the top selling brands in India and commands high
margins. Copier paper contributed 45% of Paper sales volume in FY13, which
increased to 60% in FY17. The company intends to leverage strong growth in
copier paper in India (CAGR of ~8% v/s ~4% in other paper and stationery) to
improve Paper realization and margin (+340bp to 38% in FY20E).
An attractive utilization play
Trident
Enhanced profitability led by bed linen
The company most recently ventured into bed linen, with installed capacity of
43m meters. In the first year of operations, bed linen had 29% utilization, and
the company expects to ramp-up operations by adding new clients. TRID has
already added more than 10 clients in FY18 so far, including large replenishment
clients like IKEA and Amazon. Bed linen currently posts EBITDA loss, which is
expected to turnaround by 3QFY18 as utilization reaches 40%. We believe new
customer acquisition and the expanding share of TRID in the global textile
market should help the bed linen segment increase utilization to 60% in FY20.
Niket Shah
+
91 22 3980 5436
Niket.Shah@motilaloswal.com
Please click here for Video Link
23 August 2017
3

Trident
Stock Performance (1-year)
Bath linen (towel) inching toward higher utilization
TRID is the market leader in the towel segment in India, and accounts for a
significant part (32%) of Indian towel exports to the US. The company used to run at
high utilization of 74% in FY13, which declined thereafter as TRID invested heavily in
capex and nearly doubled its capacities from 42MT to 90MT to make itself future-
ready. Since there would be no further capex, the company expects the plants to
return to higher utilization, resulting in margin expansion (as yarn capacity would be
utilized in-house and no further spinning capacity would be required). Capacity
utilization is expected to reach 65% in FY20E from the current level of 50%.
Rising share of India in global home textile market
In terry towel category, India accounts for 40% of the global market, which has
increased at 15% YoY. India also commands the third largest market share in the
Asia-Pacific home textile market, and is expected to grow fastest in the world at a
CAGR of 7.2% over 2015-2020. The growing share of India in the global home textile
market puts TRID in a sweet spot to garner more market share (evident from the
increase in the company’s market share in towel exports to the US, from 10% in
CY14 to 13% in CY16), particularly in bath linen, where it is the domestic market
leader.
Robust free cash flow generation with major capex cycle behind
In FY16, the company executed greenfield expansion, with total outlay of INR7.5b
for 1.9 lac spindles capable of producing compact yarn up to 120 counts. The
initiative was taken to attain 100% backward integration for the bed linen unit. The
company is not expected to invest heavily in expanding capacities, but is rather
likely to improve efficiencies by initiatives such as debottlenecking, which would
result in better capacity utilization and thus steady generation of free cash flows in
both Paper and Home Textile segments.
23 August 2017
4

Trident
Valuation and view
TRID appears to be at the onset of a high growth cycle, driven by:
1. Growth in bed linen segment:
The company is expected to turn EBITDA
profitable in the recently ventured bed linen segment by 3QFY18 as utilization
touches 40%. In the first year of operations, bed linen witnessed utilization of
29%, which is expected to increase to 60% in FY20. Also, the segment’s share in
overall revenue is expected to increase from 4% in FY17 to 9% in FY20.
2. Higher utilization in bath linen:
TRID used to run at high utilization of 74% in the
towel segment in FY13. However, utilization declined thereafter as the company
almost doubled its capacity in the segment from 42MT in FY13 to 90MT in FY15
to make itself future-ready. Going forward, the company is expected to witness
higher utilization (65% in FY20E v/s 50% in FY17), which would not require
further addition of spindles as yarn capacity would be utilized in-house.
3. TRID’s rising share in global market:
The share of Indian companies in the global
textile market is on the rise as the country is becoming highly competitive in
terms of raw material cost, labor cost and level of automation, leading to
improved quality. TRID has been proactive in capitalizing on this opportunity,
leading to an increase in the company’s share in global towel exports to the US
(from 10% in CY14 to 13% in CY16). Also, the company’s share in Indian towel
exports to the US has also increased from 28% in CY14 to 32% in CY16.
4. Paper biz margin driven by branded copier paper:
TRID has consistently
increased its share of copier paper over the years. Copier paper contributed 45%
of the company’s overall Paper sales volume in FY13, which increased to 60% in
FY17. Since, copier paper commands high margins, we expect Paper business
margin to expand 340bp to 38% in FY20.
We believe TRID is set to benefit from multiple factors, including industry growth
and expanding share of bed linen/copier paper. Hence, we estimate 9% sales CAGR
and 24% PAT CAGR over FY17-20, with improving RoCE and RoE (from 7.5% and 13%
in FY17 to 13% and 17.1% in FY20, respectively). IND AS adjustment recognized on
fair valuation of PPE to the tune of INR7,582m has resulted in a depressed return
ratios, with RoE and RoCE standing at 18.3% and 8.6% in FY17 pre-adjustment v/s
13% and 7.5% in FY17 post-adjustment. Consequently, pre-adjusted RoE and RoCE is
expected to increase to 21.4% and 15.1% in FY20E respectively. We value TRID at
11x FY19E EPS, arriving at a TP of INR114, implying 39% upside. We initiate coverage
with
Buy.
23 August 2017
5

Trident
Company overview
India’s leading integrated home textiles and paper manufacturer
Trident (TRID) is one of India’s leading diversified group of businesses
headquartered in Ludhiana, Punjab. The company is the world’s largest wheat
straw-based paper manufacturer, has world’s largest compact yarn spinning unit
under single roof and is among the world’s largest integrated home textile
manufacturers.
Home Textiles business contributed 82% of its overall revenues in FY17, while Paper
accounted for 18%.
TRID was incorporated in 1990 as a yarn manufacturer. It gradually expanded into
towels in 1998 and also set up a paper manufacturing facility. Most recently, the
company ventured into bed linen (part of Home Textile), marking a shift from a
pure-play yarn player to an integrated home textile and paper manufacturer.
Exhibit 1: TRID’s journey since inception
Source: Company
Significant presence in both domestic and export markets
TRID has a strong presence in both domestic and export markets. As of FY17,
exports contributed 89% of revenue in the bed and bath linen, 32% in yarn and 9%
in paper. On the other hand, the domestic market contributed 91% of revenue in
paper, 68% in yarn, and 11% in bed and bath linen.
The US remains the primary market for the company’s flagship towel business (bath
linen). TRID’s share in Indian towel exports to the US stands at ~32%, while its share
in global towel exports to the US stands at ~13%.
23 August 2017
6

Trident
Client reach
Exhibit 2: TRID’s international clientele
Source: Company
Exhibit 3: TRID’s domestic clientele
Source: Company
Exhibit 4: TRID’s online clientele
Source: Company
23 August 2017
7

Trident
Home Textiles – the key to improved profitability
Fully integrated process across units
Homes Textile is the largest revenue contributor for TRID. The company has fully
integrated manufacturing processes, which provide strong control over the
production value chain. The company has plants in Budni (MP) and Barnala (Punjab).
TRID has one unit with capacity of 300 looms and 48k MT per annum (p.a.) in Budni,
and three units with capacity of 388 looms, 42k MT p.a. in Barnala for bath linen. For
bed linen, there is one unit with capacity of 500 looms and 43.2m meters p.a. in
Budni.
Capacities for bed and bath linen are vertically integrated by installed capacities for
yarn, for which there are five units with capacity of 3.7lac spindles and 2,880 rotors
in Budni, and five units with capacity of 1.8lac spindles and 3,584 rotors in Barnala.
Exhibit 5: Fully integrated manufacturing process
Source: Company
23 August 2017
8

Trident
Better product mix in bed linen and improved utilization to drive growth
TRID ventured into the bed linen segment in FY17 (installed capacity of 43m meters)
to leverage on the strong customer base in bath linen (towel). In the first year of
operations, bed linen had 29% utilization – the company expects to ramp up its
operations by capturing new clients and drive profitability via top-line growth.
The company has already added more than 10 clients in FY18 so far in the segment,
including large replenishment clients like IKEA and Amazon. As of now, the company
is servicing small orders from the large players to test capability and quality; it
expects to gradually leverage the same to bag large orders. Led by its full backward
integration in the segment, the company is well placed to service clients by having
full control over production quality.
Bed linen segment accounts for the largest share in the Indian and global home
textile markets. It is globally pegged to grow at a CAGR of 4.4% over 2015-20, while
the Indian bed linen and bed spread market is expected to witness much higher
CAGR of 7.4% over this period.
For TRID, bed linen currently posts EBITDA loss, which is expected to turnaround by
3QFY18, as the segment reaches utilization of 40%. Driven by new customer
acquisition and expanding share of TRID in the global textile market, we expect
utilization in bed linen to eventually increase up to 60% in FY20. Additionally, the
company manufacturers bed sheets of 200 counts, which are expected to be scaled
up to higher counts to penetrate further into the market. Higher count provides
higher realization without requiring any additional capacity or modification in the
manufacturing unit. We expect bed linen realization CAGR of 13% over FY17-20 to
INR209m/MT.
Exhibit 7: Bed linen to post 44% revenue CAGR over
FY17-20E
Revenue (INRm)
69%
Growth (%)
Exhibit 6: Bed linen’s utilization set to improve
Installed capacity (mn mtrs)
50%
40%
29%
Utilization (%)
60%
38%
30%
43
FY17
43
FY18E
43
FY19E
43
FY20E
1,800
FY17
3,035
FY18E
4,172
FY19E
5,408
FY20E
Source: Company, MOSL
Source: Company, MOSL
23 August 2017
9

Trident
Bath linen (towel) inching toward higher utilization
TRID is the market leader in India’s towel segment, and forms a significant part
(32%) of Indian towel exports to the US. The company used to run at high utilization
of 74% in FY13; however, it declined thereafter, as TRID invested heavily in capex
and nearly doubled its capacities from 42MT to 90MT, making itself ready for future
opportunities. Since there would be no further capex, the company expects the
plants to run at higher utilization, which would result in margin expansion, as yarn
capacity would be utilized in-house and no further spinning capacity would be
required.
Exhibit 9: Bath linen to post 12% revenue CAGR
over FY17-20E
Revenue (INRm)
26%
14%
0%
15%
3%
13%
13%
11%
Gr (%)
65%
Exhibit 8: Bath linen’s utilization set to improve
74%
Installed capacity (MT)
67%
41%
50%
54%
Utilization (%)
60%
38%
42
FY13
42
FY14
90
FY15
90
FY16
90
FY17
90
90
90
FY13
FY14
FY15
FY16
FY17
FY18E FY19E FY20E
Source: Company, MOSL
FY18E FY19E FY20E
Source: Company, MOSL
23 August 2017
10

Trident
Branded copier paper to drive margins
India’s only wheat straw-based paper manufacturer
TRID is the world’s largest and India’s only wheat straw-based paper manufacturer.
The company has two units with capacity of 175k MT p.a. in Barnala (Punjab), which
contribute ~18% of its overall revenue. The company uses wheat straw (residue left
after harvesting wheat, which typically wheat farmers sell for extra income) for
manufacturing paper, which provides it with a locational advantage as Punjab is the
highest wheat producing state in the country (facilitates easy procurement at
attractive pricing). Additionally, the use of wheat straw is environment friendly.
With production capacity of 450TPD, TRID saves 8,100 trees per day by using wheat
straw instead of wood. This, in turn, results in a reduction of 5,520lbs of CO2
emissions per 1,000 reams of paper produced.
The manufacturing facilities are technology advanced as well, with TRID being the
first mill in the world to use ECF bleaching and oxygen delignification on wheat
straw and the first mill in India to adopt fuzzy logic for burner management in lime-
kiln, in-house QC and R&D lab.
Product mix skewed toward high-growth copier paper
TRID’s Paper business contributes ~18% of overall revenues. The high-growth, high-
margin branded copier paper accounts for ~60% of its sales volume. The company
intends to further increase the share of branded copier and leverage on the
industry-wide growth in the segment. Copier paper in India is witnessing a CAGR of
~8% v/s ~4% in other paper and stationery.
Exhibit 10: Paper product mix in FY13
Exhibit 11: Paper product mix in FY17
Non-
copier
55%
Copier
45%
Non-
copier
40%
Copier
60%
Source: Company, MOSL
Source: Company, MOSL
With 47 distributors pan-India and customer presence across 54 countries, TRID
commands the highest market share in north India, and is the fourth largest player
in India. Easy procurement at attractive pricing as discussed earlier also provides
multiple sourcing alternatives. With production capacity of 450TPD, TRID is set to
augment its market share further.
23 August 2017
11

Trident
Going forward, the company plans to carry out a debottlenecking project to release
capacity of 250-275 TPD, which would improve its utilization, allowing further
expansion in the copier segment. Copier paper, being among the top-selling brands
in India and also providing higher margins, is expected to drive overall Paper
business margin expansion of 340bp to 38% in FY20.
Additionally, there is no new capacity coming up industry-wide on account of huge
barriers to entry (e.g., environment clearance as government stresses on a zero
disposal plant; heavy capex; replacement cost of a paper manufacturing plant is as
large as ~INR20b and takes ~4 years for commercial launch). This will lead to higher
capacity utilization while capturing growth in the segment.
Exhibit 12: Paper units to run at high utilization level
Installed capacity (mn mtrs)
89%
87%
87%
88%
89%
Utilization (%)
90%
90%
90%
175,000
FY13
175,000
FY14
175,000
FY15
175,000
FY16
175,000
FY17
175,000
FY18E
175,000
FY19E
175,000
FY20E
Source: Company
Exhibit 13: EBITDA margins in Paper business to expand
EBITDA
27%
28%
Margins (%)
29%
29%
35%
37%
38%
38%
1,944
2,302
2,390
2,400
3,020
3,325
3,413
3,465
FY13
FY14
FY15
FY16
FY17
FY18E
FY19E
FY20E
Source: Company
23 August 2017
12

Trident
Culminating capex cycle
Robust free cash flow generation expected as major capex cycle gets over
TRID in the recent past has invested heavily to expand and carry out backward
integration for its existing capacities. In FY16, the company executed greenfield
expansion with total outlay of INR7.5b for 1.9 lac spindles capable of producing
compact yarn up to 120 counts. The initiative was taken to attain 100% backward
integration for the bed linen unit.
Going forward, the company is not expected to invest heavily in expanding
capacities. In the paper segment too, there is no new capacity coming up industry-
wide on account of huge barriers to entry (e.g., environment clearance as
government stresses on a zero disposal plant; heavy capex; replacement cost of a
paper manufacturing plant is as large as ~INR20b and takes ~4 years for commercial
launch).
The company is rather expected to improve efficiencies by undertaking initiatives
like debottlenecking, which would result in better capacity utilization in both Paper
and Home Textile. Utilization in yarn is expected to increase to 98% in FY20 from
current levels of 93%, while in Paper utilization is likely to rise marginally to 90% in
FY20 from 89% now. Utilization in bed and bath linen is expected to increase to 60%
and 65% in FY20 from current levels of 29% and 50%, respectively.
Exhibit 14: Robust free cash flow generation expected
FCF (INRm)
6,123
3,005
3,652
9,192
8,428
9,432
7,427
(5,926)
FY13
FY14
FY15
FY16
FY17
FY18E
FY19E
FY20E
Source: Company, MOSL
23 August 2017
13

Trident
SWOT analysis
Easy availability of
wheat straw as raw
material
Prestigious and loyal
customer base
Market leader in
terry towels in India
Ventures into faster-
growing bed linen
segment
Cyclical nature of
paper industry
Highly competitive
market
Expansion into value-
added product
segments
Emerging overseas
market and rising share
of Indian companies
Government
regulations and
uncertainty over duty
structure
Growing competition
putting pressure on
profitability
23 August 2017
14

Trident
Earnings to post 24% CAGR over FY17–20
EBITDA margin to expand by 110bp
We expect PAT CAGR of 24% over FY17–20, led by 9% CAGR in revenue due to ramp-
up of the bed linen segment (as the business turns EBITDA profitable) and steady
growth in the bath linen and paper businesses. Additionally, 11% EBITDA CAGR over
the same period would aid growth in PAT.
Revenue growth would be driven by 44% revenue CAGR in bed linen and steady
revenue CAGR of 12% in bath linen.
Exhibit 15: Revenue to post 9% CAGR over FY17–20…
Revenues (INRm)
22%
16%
28%
10%
-3%
-2%
1,800
FY17
3,035
FY18E
4,172
FY19E
5,408
FY20E
10%
8%
38%
30%
Gr. (%)
Exhibit 16: …driven by 44% revenue CAGR in bed linen
Revenues (INRm)
69%
Gr. (%)
33,726 39,096 38,018 37,112 47,438 52,164 57,122 61,677
FY13
FY14
FY15
FY16
FY17
FY18E FY19E FY20E
Source: Company, MOSL
Source: Company, MOSL
We expect EBITDA margin to expand by 110bp to 19.8% in FY20, as the company
continues to improve its product mix toward higher-value products, especially in the
paper and bed linen segments. PAT margin is expected to expand from 7.1% in FY17
to 10.4% in FY20 on account of deleveraging of balance sheet, as the company
continues its efforts to turn debt-free.
Exhibit 17: EBITDA to register CAGR of 11% over FY17–20
EBITDA (INRm)
16.5%
18.6%
17.4%
19.7%
EBITDA (%)
293%
Exhibit 18: PAT to record CAGR of 24% over FY17–20
PAT (INRm)
Gr. (%)
18.7% 19.0% 19.4% 19.8%
5,553
FY13
7,276
6,608
FY15
7,297
8,882
12,212
9,911 11,082
493
1,940
FY14
105% 3,372
39%
1,179
-39%
2,421
FY15
FY16
FY17
25%
4,221
25%
5,297
21%
6,401
FY14
FY16
FY17
FY18E FY19E FY20E
Source: Company, MOSL
FY13
FY18E FY19E FY20E
Source: Company, MOSL
23 August 2017
15

Trident
Exhibit 19: Surging toward becoming debt-free
Net Debt to Equity (x)
3.0
1.9
1.7
Exhibit 20: Cash flow from operations to remain strong
CFO (INRm)
10,451
9,428
10,432
1.4
1.0
0.7
0.5
0.2
3,803
7,469
5,441
5,288
8,427
FY13
FY14
FY15
FY16
FY17
FY18E FY19E FY20E
Source: Company, MOSL
FY13
FY14
FY15
FY16
FY17
FY18E FY19E FY20E
Source: Company, MOSL
TRID’s overall utilization rate is expected to improve further on better operational
efficiencies, led by a significant improvement in utilization of bed linen, followed by
bath linen. This, coupled with top-line growth, should lead to improved return
ratios.
We estimate 9% sales CAGR and 24% PAT CAGR over FY17-20, with improving RoCE
and RoE (from 7.5% and 13% in FY17 to 13% and 17.1% in FY20, respectively). IND
AS adjustment recognized on fair valuation of PPE to the tune of INR7,582m has
resulted in a depressed return ratios, with RoE and RoCE standing at 18.3% and 8.6%
in FY17 pre-adjustment v/s 13% and 7.5% in FY17 post-adjustment. Consequently,
pre-adjusted RoE and RoCE is expected to increase to 21.4% and 15.1% in FY20E
respectively.
Exhibit 21: Improved utilization in bed linen
Installed capacity (mn mtrs)
50%
40%
29%
Utilization (%)
60%
74%
Exhibit 22: Improved utilization in bath linen
Installed capacity (MT)
67%
38%
41%
50%
54%
Utilization (%)
60%
65%
43
FY17
43
FY18E
43
FY19E
43
FY20E
42
FY13
42
FY14
90
FY15
90
FY16
90
FY17
90
90
90
FY18E FY19E FY20E
Source: Company, MOSL
Source: Company, MOSL
Exhibit 23: Higher utilization to improve return ratios
23.7
RoE
RoCE
16.1
9.0
10.9
17.1
13.0
12.3
7.3 6.5
9.9
12.4
7.7
7.2
13.0
7.5
14.5
FY13
FY14
FY15
FY16
FY17
FY18E
FY19E
FY20E
Source: Company, MOSL
23 August 2017
16

Trident
Valuation and view
Initiating with Buy rating
We believe TRID is set to benefit from multiple factors, including industry growth and
the expanding share of bed linen from 4% of overall revenues in FY17 to 9% in FY20E.
The rising share of copier paper (from 45% of Paper sales volume in FY13 to 60% in
FY17) is expected to lead to Paper business margin expansion of 340bp to 38% in FY20.
We estimate a CAGR of 9% in sales and 24% in PAT over FY17-20, with improving RoCE
and RoE (from 7.5% and 13% in FY17 to 13% and 17.1% in FY20, respectively).
We value TRID at 11x FY19E EPS, arriving at a price target of INR114, implying 39%
upside. We initiate coverage on TRID with a Buy rating.
Growth in bed linen segment
The company is expected to turn EBITDA profitable in the recently ventured bed
linen segment by 3QFY18 as utilization touches 40%. In the first year of operations,
bed linen witnessed utilization of 29%, which is expected to increase to 60% in FY20.
Also, the segment’s share in overall revenue is expected to increase from 4% in FY17
to 9% in FY20.
Exhibit 24: Bed linen to post revenue CAGR of 44% over
FY17-20E
Revenues (INRm)
69%
50%
38%
40%
30%
29%
Gr. (%)
Exhibit 25: Bed linen utilization set to improve to 60% in
FY20E
Installed capacity (mn mtrs)
Utilization (%)
60%
1,800
FY17
3,035
FY18E
4,172
FY19E
5,408
FY20E
43
FY17
43
FY18E
43
FY19E
43
FY20E
Source: Company, MOSL
Source: Company, MOSL
Higher utilization in bath linen segment
TRID used to run at high utilization of 74% in the towel segment in FY13. However,
utilization declined thereafter as the company almost doubled its capacity in the
segment from 42MT in FY13 to 90MT in FY15 to make itself future-ready. Going
forward, the company is expected to witness higher utilization (65% in FY20E v/s
50% in FY17), which would not require further addition of spindles as yarn capacity
would be utilized in-house.
TRID’s rising share in global market
The share of Indian companies in the global textile market is on the rise as the
country is becoming highly competitive in terms of raw material cost, labor cost and
level of automation, leading to improved quality. TRID has been proactive in
capitalizing on this opportunity, leading to an increase in the company’s share in
global towel exports to the US (from 10% in CY14 to 13% in CY16). Also, the
company’s share in Indian towel exports to the US has also increased from 28% in
CY14 to 32% in CY16.
23 August 2017
17

Trident
Paper biz margin driven by branded copier paper
TRID has consistently increased its share of copier paper over the years. Copier
paper contributed 45% of its overall Paper sales volume in FY13, which increased to
60% in FY17. Since, copier paper commands high margins, we expect Paper business
margin to expand 340bp to 38% in FY20.
Value TRID at 11x P/E multiple on FY19E EPS
We believe TRID is set to benefit from multiple factors, including industry growth
and expanding share of bed linen/copier paper. Hence, we estimate 9% sales CAGR
and 24% PAT CAGR over FY17-20, with improving RoCE and RoE (from 7.5% and 13%
in FY17 to 13% and 17.1% in FY20, respectively). IND AS adjustment recognized on
fair valuation of PPE to the tune of INR7,582m has resulted in a depressed return
ratios, with RoE and RoCE standing at 18.3% and 8.6% in FY17 pre-adjustment v/s
13% and 7.5% in FY17 post-adjustment. Consequently, pre-adjusted RoE and RoCE is
expected to increase to 21.4% and 15.1% in FY20E respectively. We value TRID at
11x FY19E EPS, arriving at a TP of INR114, implying 39% upside. We initiate coverage
with
Buy.
Exhibit 26: TRID’s 1-year forward P/E
P/E (x)
33
25
17
9
1
2.0
8.6
3.6
13.5
Avg (x)
Max (x)
Min (x)
+1SD
29.6
-1SD
-tv Perf.
9.4
Source: Company, MOSL
Exhibit 27: Peer Comparison
Company Name
Vardhman Textiles Ltd.
Indo Count Industries Ltd.
Welspun India Ltd.
KPR Mill Ltd.
Trident Ltd.
PE
Market Cap.
(USD m)
FY18E FY19E
1,047
9.1
7.5
318
9.0
7.7
1,154
11.5
9.5
892
15.6
13.3
625
9.9
7.9
PB
FY18E
1.4
2.0
2.6
3.5
1.4
FY19E
1.2
1.6
2.2
2.9
1.2
RoE %
FY18E FY19E
15.2
16.4
22.9
21.8
25.3
24.9
23.4
22.2
14.5
16.1
EV/Sales
Sales CAGR PAT CAGR
FY18E FY19E FY17-19E FY17-19E
1.2
1.1
7%
5%
1.0
0.9
6%
4%
1.5
1.3
11%
11%
2.0
1.8
16%
21%
1.2
1.0
10%
25%
Source: Company, MOSL
23 August 2017
18

Trident
Bull & Bear case
Bull case
In the bull case, we are assuming a boost in demand from the global home
textile industry, resulting in a significant improvement in utilization, and thus,
driving volume growth. Over FY17-20, we assume revenue CAGR of 13% (9% in
base case), EBITDA CAGR of 16% (11% in base case) and PAT CAGR of 32% (24%
in base case).
We assume that the company will be able to convert small orders in bed linen
into sustainable large orders, resulting in revenue CAGR of 59% over FY17-20 in
the bed linen segment (44% in base case).
We assume that the company would leverage its market leadership position in
bath linen and expand into overseas markets other than the US, resulting in
revenue CAGR of 18% over FY17-20 in the bath linen segment (12% in base
case). We assume a rapid shift in product mix toward high-value products,
resulting in significant margin expansion.
Accordingly, we are assuming 140bp EBITDA margin expansion (110bp in base
case) to 20.1% over FY17-20. This will lead to EPS CAGR of 32% over FY17-20.
Assuming a target multiple of 12x in the bull case instead of 11x that we have
taken for the base case, we get a bull case target price of INR154 (upside of 88%
to CMP) instead of the base case target price of INR114 (upside of 39%), based
on FY19E EPS.
Bear case
In the bear case, we are assuming muted growth in global home textile industry,
leading to pressure on capacity utilization in both bed and bath linen. Over
FY17-20, we assume revenue CAGR of 1% (9% in base case), EBITDA CAGR of 2%
(11% in base case) and PAT CAGR of 7% (24% in base case).
We assume that the company will face increased pressure from competitors and
at raw material prices front, which would not allow the company to sustain large
orders in bed linen. We assume revenue CAGR of 15% over FY17-20 in the bed
linen segment (44% in base case).
We assume that increased competition, coupled with muted growth in the
global home textile industry, would restrict growth in the bath linen segment.
We assume utilization in the segment would dip down to 45% in FY20 (65% in
base case).
Accordingly, we are assuming 50bp EBITDA margin expansion (110bp in base
case) to 19.2% over FY17-20. This will lead to EPS CAGR of 7% over FY17-20.
Assuming a target multiple of 10x, we get a bear case target price of INR72
(downside of 12%), instead of the base case target price of INR114 (upside of
39%), based on FY19E EPS.
23 August 2017
19

Trident
Exhibit 28: Scenario Analysis – Bull Case
Sales (INR m)
Sales growth (%)
EBITDA (INR m)
EBITDA Margin (%)
EBITDA growth (%)
PAT (INR m)
PAT Margin (%)
PAT growth (%)
EPS (INR)
Target multiple (x)
Target price (INR)
Upside/downside (%)
FY17
47,438
27.8
8,882
18.7
22%
3,372
7.1
39.3
6.6
FY18E
59,135
24.7
11,413
19.3
28%
5,471
9.3
62.2
10.7
FY19E
63,889
8.0
12,586
19.7
10%
6,546
10.2
19.7
12.8
12
154
88
Exhibit 29: Scenario Analysis – Bear Case
Sales (INR m)
Sales growth (%)
EBITDA (INR m)
EBITDA Margin (%)
EBITDA growth (%)
PAT (INR m)
PAT Margin (%)
PAT growth (%)
EPS (INR)
Target multiple (x)
Target price (INR)
Upside/downside (%)
FY17
FY18E
FY19E
47,438 49,206 48,157
27.8
3.7
-2.1
8,882
9,201
9,102
18.7
18.7
18.9
22%
4%
-1%
3,372
3,634
3,652
7.1
7.4
7.6
39.3
7.8
0.5
6.6
7.1
7.2
10
72
-12
Source: Company, MOSL
Source: Company, MOSL
23 August 2017
20

Trident
Industry overview
Home Textile presents huge opportunity with rising Indian share in global market
Global home textile industry
The global home textile industry is expected to grow at a 3.5% CAGR over 2015-20
to reach USD131.5b, driven by growth in bed linen/spread and bath linen.
The bed linen and bed spread segment accounted for the largest share of 43.9% in
2014, and is expected to grow at a CAGR of 4.4%, from USD48.9b in 2015 to
USD60.8b by 2020. Bath/toilet linen accounted for the second largest market share
– it is expected to grow at 3.5% to reach USD26.4b by 2020, representing 20.1%
market share.
Exhibit 30: Size of global home textile market – 2020E (USDb)
Upholstery, 15.4
Kitchen linen, 11.2
Floor, 17.6
Bed linen & Bed
spread, 60.8
Bath/Toilet linen,
26.4
Source: Company, MOSL
Exhibit 31: Global bed & bath linen market size (USDb)
Bed linen & Bed spread
47.1
26.4
Bath/Toilet linen
60.8
21.6
2014
2020E
Source: Company, MOSL
India commands the third largest share in the Asia-Pacific home textile market.
Home textile spending in India (at USD3.7b in 2014E) is expected to grow at a CAGR
of 7.2% over 2015-20 (fastest in the world) to reach USD5.6b by 2020.
Indian home textile market
Bed linen and bed spread segment accounted for 58.1% of the Indian home textile
market worth USD2.1b in 2014, and is expected to witness highest growth over
2015-20 (CAGR of 7.4%) to reach USD3.3b. Bath/Toilet linen, which held the second
largest market share in 2014, is expected to register a CAGR of 6.9% to reach
USD0.9b by 2020.
23 August 2017
21

Trident
Growth in the domestic textile segment is expected to be driven by India’s
advantageous position in terms of raw material and labor cost. India has a strategic
advantage over its major competitor China in terms of labor cost (USD1.12 per hour
v/s USD2.65 per hour in China), according to the Werner International 2014 report.
Moreover, the Indian government’s policies – e.g. Technology Upgradation Fund
Scheme (TUFS), duty drawback, liberalization of FDI policy and EPCG – have
provided a big boost to the textile industry.
Exhibit 32: Size of Indian home textile market - 2020E (USDb)
Upholstery,
0.9
Floor, 0.3
Kitchen
linen, 0.2
Bed linen &
Bed spread,
3.3
2014
Source: Company, MOSL
2.1
0.9
Exhibit 33: Indian bed & bath linen market size (USDb)
Bed linen & Bed spread
Bath/Toilet linen
3.3
Bath/Toilet
linen, 0.9
0.6
2020E
Source: Company, MOSL
Exhibit 34: Market share in US towel market
India
China
35%
23%
25%
25%
16%
Pakistan
ROW
36%
26%
15%
23%
2013
22%
2015
38%
25%
15%
22%
2017
Source: Company, MOSL
40%
30%
23%
15%
22%
2009
24%
2011
Exhibit 35: Market share in US sheet market
India
China
Pakistan
38%
26%
29%
19%
23%
16%
23%
2011
18%
2013
24%
12%
17%
2015
23%
12%
16%
2017
Source: Company, MOSL
22%
14%
ROW
46%
48%
49%
26%
2009
23 August 2017
22

Trident
Domestic paper industry to witness CAGR of 8-10%
The Indian paper industry accounts for ~3% of the world’s paper production, with a
turnover of ~INR500b. Total production grew at a CAGR of 13.3% over FY11-15 to
~16.63m tonnes. The domestic paper industry, employing more than 0.5m people
directly and 1.5m people indirectly, is being driven by multiple factors:
The government policies such as 100% FDI in the sector and 0% import duty on
machinery support growth in the industry. Further, the GoI has earmarked
spending of INR280b on education and proposed to open 62 Navodaya
Vidyalaya over the next two years.
The country is witnessing a constant increase in the literacy rate (from 65% in
2001 to 74% in 2011).
Demand for paper is directly linked to growth in the publications sector. The
country witnessed an increase in the number of registered publications
(newspapers and other periodicals) from 73,146 in 2009 to 1,05,443 in 2015.
Additionally, the industry is witnessing increased demand for packaging
products and heightened corporate activity.
The paper consumption in India is expected to grow by an average annual growth
rate of 8-10% over FY16-19, with capacity addition in line with demand growth.
Annual per capita consumption of paper in India remains at a mere 13kg v/s global
average of 57kg, providing enough headroom for growth.
Demand in the paper industry is expected to be driven by growth in branded copier
paper (CAGR of 10% over FY17-FY21), which is expected to outpace growth in
writing and printing paper (CAGR of 4.7%).
Exhibit 36: Annual per capita consumption of paper (kg)
US Japan EU
224
218
China
Indonesia
World Avg.
India
Exhibit 37: India’s demand supply matrix of paper industry
Production (MT)
10.8
10.8
10.1
Demand (MT)
11.2
10.7
159
75
29
Per capital consumption (kg)
57
9.8
13
FY14
FY15
FY16
Exhibit 38: Paper consumption pattern by category
Exhibit 39: Copier paper to grow at 10% CAGR over FY17-21
Writing & Printing paper (MT)
Branded Copier (MT)
5.2
Newsprint,
18%
Speciality,
4%
4.3
Paperboard
& Packing,
46%
Printing &
Writing,
32%
0.9
1.3
FY17
Source: Company, MOSL
FY21E
Source: Company, MOSL
23 August 2017
23

Trident
Key risks
Currency appreciation
TRID has presence across the globe, with exports forming 89% of revenue in the bed
and bath linen segment, 32% in yarn and 9% in paper. The Indian currency
appreciated 2.7% against the USD from Apr’16 to Jun’17. Since a large part of the
company’s revenue is exposed to currency risk, any unfavorable movement in
currency would have a negative impact of profitability.
Fluctuating cotton prices
The industry witnessed a sharp increase of 20% in cotton prices from Apr’16 to
Jun’17. Since cotton is the major raw material for the company, any unfavorable
fluctuation in the cotton prices directly impacts the margins.
23 August 2017
24

Trident
Management overview
Mr Rajinder Gupta, Co-Chairman
Mr. Gupta is the founder of the company and served as Managing Director from
1992 to 2012. A first generation entrepreneur having rich & varied exposure of
promoting industrial ventures over the last three decades, Mr. Gupta was awarded
“Padmashree” in 2007, in recognition of his distinguished services in the field of
trade and industry. He is the Nominated Vice-Chairman of Punjab State Planning
Board, Chairman of FICCI Regional Advisory Council (Punjab, Haryana, Chandigarh &
HP) and member of Managing Committee of ASSOCHAM.
Mr Abhishek Gupta, Chief Executive Officer
Mr. Gupta, serving as the CEO of the company, leads the Corporate Marketing and
Innovation Team and spearheaded the branding initiatives of Copier Paper. He holds
Bachelor’s Degree in Law & Business studies from University of Warwick,
International Marketing from Harvard Business School and Entrepreneurial
Development Program from ISB, Hyderabad. He was recently honored with the
ASSOCHAM Leadership Award (CEO), 2016.
Ms Pallavi Shardul Shroff, Chairperson
Ms Shroff is currently Chairperson and independent director on company’s board.
She is a Managing Partner of Shardul Amarchand Mangaldas & Co. having over 35
years of experience. She is the National Practice Head of Dispute Resolution, leading
litigation and arbitration teams and mentors the Competition Law practice at the
firm. She has been recognized as one of the Most Powerful Women in Indian
Business by Business Today.
Mr Rajiv Dewan, Independent Director
Mr. Dewan is currently an independent director on company’s board. He is a
practicing Chartered Accountant and possesses wide experience in tax planning,
management consultancy, business restructuring, capital market operations, SEBI-
related matters and other corporate laws.
Mr Deepak Nanda, Managing Director
Mr. Nanda is currently the Managing Director. He is an alumnus of IIM, Ahmedabad
and holds a degree of Master of Science in Computer Software and Management.
Mr Nanda possesses more than three decades of experience in business
development, client relationship, contract negotiations, project implementation and
delivery, and improving the efficiency and effectiveness of business.
23 August 2017
25

Trident
Financials and valuations
Consolidated - Income Statement
Y/E March
Gross Revenue from Operations
Change (%)
Raw Materials
Employees Cost
Other Expenses
Excise
Total Expenditure
% of Sales
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income
PBT bef. EO Exp.
EO Items
PBT after EO Exp.
Total Tax
Tax Rate (%)
Minority Interest
Reported PAT
Adjusted PAT
Change (%)
Margin (%)
FY14
39,096
15.9
20,521
2,870
8,429
31,820
81.4
7,276
18.6
2,684
4,592
2,103
163
2,652
0
2,652
681
25.7
30
1,940
1,940
293.5
5.0
FY15
38,018
-2.8
19,309
3,872
8,230
31,410
82.6
6,608
17.4
3,213
3,395
2,060
345
1,680
0
1,680
501
29.8
0
1,179
1,179
-39.3
3.1
FY16
37,112
-2.4
17,286
4,295
7,778
455
29,815
80.3
7,297
19.7
3,366
3,931
1,452
334
2,813
0
2,813
392
13.9
0
2,421
2,421
105.4
6.5
FY17
47,438
27.8
22,916
5,794
9,351
494
38,556
81.3
8,882
18.7
4,125
4,757
1,410
1,035
4,382
0
4,382
1,016
23.2
-7
3,372
3,372
39.3
7.1
FY18E
52,164
10.0
25,091
6,468
10,172
522
42,253
81.0
9,911
19.0
4,187
5,725
1,169
939
5,495
0
5,495
1,274
23.2
0
4,221
4,221
25.2
8.1
FY19E
57,122
9.5
27,419
6,969
11,082
571
46,040
80.6
11,082
19.4
4,258
6,824
956
1,028
6,896
0
6,896
1,599
23.2
0
5,297
5,297
25.5
9.3
(INR Million)
FY20E
61,677
8.0
29,543
7,401
11,904
617
49,465
80.2
12,212
19.8
4,319
7,893
669
1,110
8,334
0
8,334
1,933
23.2
0
6,401
6,401
20.9
10.4
Consolidated - Balance Sheet
Y/E March
Equity Share Capital
Total Reserves
Net Worth
Minority Interest
Total Loans
Deferred Tax Liabilities
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Other Current Liabilities
Provisions
Net Current Assets
Appl. of Funds
E: MOSL Estimates
FY14
3,111
5,737
9,278
0
18,623
1,082
28,983
34,858
16,902
17,956
363
1,152
12,344
6,429
2,641
250
3,024
2,832
2,326
267
239
9,513
28,983
FY15
5,086
9,467
14,554
0
25,801
1,242
41,597
48,688
20,049
28,639
2,219
309
13,904
7,508
2,033
170
4,192
3,473
2,490
534
450
10,431
41,597
FY16
5,094
19,267
24,361
0
36,592
1,582
62,535
70,389
23,415
46,974
571
723
17,025
9,065
2,513
819
4,627
2,758
2,237
373
148
14,266
62,535
FY17
5,096
22,473
27,568
0
29,733
1,655
58,956
71,122
27,540
43,582
1,098
1,054
16,132
7,747
3,751
1,326
3,307
2,909
2,302
390
217
13,223
58,956
FY18E
5,096
25,741
30,837
0
25,233
1,655
57,725
72,500
31,727
40,774
720
1,054
18,392
8,335
4,287
2,133
3,637
3,214
2,547
429
238
15,178
57,725
FY19E
5,096
29,843
34,938
0
19,733
1,655
56,326
73,576
35,985
37,591
644
1,054
20,543
8,956
4,695
2,910
3,982
3,505
2,775
469
261
17,038
56,327
(INR Million)
FY20E
5,096
34,800
39,896
0
11,733
1,655
53,283
74,591
40,304
34,287
629
1,054
21,084
9,486
5,069
2,228
4,300
3,770
2,981
507
282
17,314
53,284
23 August 2017
26

Trident
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 (%)
FCF per share
Return Ratios (%)
RoE
RoCE
RoIC
Working Capital Ratios
Fixed Asset Turnover (x)
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Leverage Ratio (x)
Current Ratio
Interest Cover Ratio
Net Debt/Equity
FY14
3.8
9.1
18.2
0.3
8.1
FY15
2.3
8.6
28.6
0.6
28.9
35.4
9.5
2.9
1.8
10.2
0.7
7.2
9.9
7.7
7.2
0.8
0.9
72
20
24
4.0
1.6
1.7
FY16
4.8
11.4
47.8
0.9
22.6
17.2
7.2
1.7
2.1
10.6
1.1
-11.6
12.4
7.2
6.8
0.5
0.6
89
25
22
6.2
2.7
1.4
FY17
6.6
14.7
54.1
1.2
22.6
12.4
5.6
1.5
1.5
7.9
1.5
18.0
13.0
7.5
6.3
0.7
0.8
60
29
18
5.5
3.4
1.0
FY18E
8.3
16.5
60.5
1.6
22.6
9.9
5.0
1.4
1.2
6.5
1.9
14.6
14.5
9.0
8.0
0.7
0.9
58
30
18
5.7
4.9
0.7
FY19E
10.4
18.7
68.6
1.9
22.6
7.9
4.4
1.2
1.0
5.3
2.4
16.5
16.1
10.9
9.9
0.8
1.0
57
30
18
5.9
7.1
0.5
FY20E
12.6
21.0
78.3
2.4
22.6
6.5
3.9
1.0
0.8
4.2
2.9
18.5
17.1
13.0
12.0
0.8
1.2
56
30
18
5.6
11.8
0.2
0.3
12.0
23.7
12.3
12.1
1.1
1.3
60
25
22
4.4
2.2
1.9
Consolidated - 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
FY14
2,652
2,684
2,028
-584
435
7,214
255
7,469
-1,345
6,123
-411
-58
-1,814
433
-4,062
-2,106
-5
0
-5,740
-86
336
250
FY15
1,680
3,213
1,939
-347
-977
5,509
-68
5,441
-1,789
3,652
192
396
-1,200
187
-1,966
-2,056
-486
0
-4,321
-80
250
170
FY16
2,766
3,376
1,230
-600
-1,424
5,348
-60
5,288
-11,214
-5,926
-250
132
-11,332
611
7,809
-1,367
-360
0
6,694
649
170
819
FY17
4,382
4,125
1,410
-1,016
1,550
10,451
0
10,451
-1,259
9,192
-331
668
-922
2
-6,859
-1,410
-761
7
-9,022
507
819
1,327
FY18E
5,495
4,187
1,169
-1,274
-1,149
8,427
0
8,427
-1,000
7,427
0
0
-1,000
0
-4,500
-1,169
-952
0
-6,621
806
1,327
2,133
(INR Million)
FY19E
6,896
4,258
956
-1,599
-1,082
9,428
0
9,428
-1,000
8,428
0
0
-1,000
0
-5,500
-956
-1,195
0
-7,651
777
2,133
2,910
FY20E
8,334
4,319
669
-1,933
-958
10,432
0
10,432
-1,000
9,432
0
0
-1,000
0
-8,000
-669
-1,444
0
-10,113
-682
2,910
2,228
23 August 2017
27

Trident
NOTES
23 August 2017
28

REPORT GALLERY
RECENT INITIATING COVERAGE REPORTS
Rs

Disclosures:
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Trident
Motilal Oswal Securities Ltd. (MOSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOSL, the Research Entity (RE) as defined in the Regulations, is engaged in the business of providing Stock
broking services, Investment Advisory Services, Depository participant services & distribution of various financial products. MOSL is a subsidiary company of Motilal Oswal Financial Service Ltd. (MOFSL). MOFSL is a listed
public company, the details in respect of which are available on
www.motilaloswal.com.
MOSL is registered with the Securities & Exchange Board of India (SEBI) and is a registered Trading Member with National Stock
Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Metropolitan Stock Exchange Of India Ltd. (MSE) for its stock broking activities & is Depository participant with Central Depository Services Limited
(CDSL) & National Securities Depository Limited (NSDL) and is member of Association of Mutual Funds of India (AMFI) for distribution of financial products. Details of associate entities of Motilal Oswal Securities Limited are
available on the website at
http://onlinereports.motilaloswal.com/Dormant/documents/Associate%20Details.pdf
Pending Regulatory Enquiries against Motilal Oswal Securities Limited by SEBI:
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 requested SEBI to provide all documents, records, investigation report relied upon by SEBI which were referred in Show Cause Notice and also sought personal
hearing. The matter is currently pending.
MOSL, it’s associates, Research Analyst or their relative may have any financial interest in the subject company. MOSL and/or its associates and/or Research Analyst may have beneficial ownership of 1% or more securities in
the subject company at the end of the month immediately preceding the date of publication of the Research Report.
MOSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a)
from time to time, have a long or short position in, act as principal in, and buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and
earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other
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as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOSL even though there might exist an inherent conflict of interest in some of the stocks mentioned in the
research report.
Research Analyst may have served as director/officer, etc. in the subject company in the last 12 month period. MOSL and/or its associates may have received any compensation from the subject company in
the past 12 months.
In the last 12 months period ending on the last day of the month immediately preceding the date of publication of this research report, MOSL or any of its associates may have:
a)
managed or co-managed public offering of securities from subject company of this research report,
b)
received compensation for investment banking or merchant banking or brokerage services from subject company of this research report,
c)
received compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company of this research report.
d)
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MOSL 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. To enhance transparency, MOSL 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. MOSL and / or its affiliates do and seek to do business including investment banking with
companies covered in its research reports. As a result, the recipients of this report should be aware that MOSL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research
Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.
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copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of MOSL. The report is based on the facts, figures and information that are considered
true, correct, reliable and accurate. The intent of this report is not recommendatory in nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not
been independently verified and no guaranty, representation of warranty, express or implied, is made as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice.
The report is prepared solely for informational purpose and does not constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments for the clients. Though
disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MOSL will not treat recipients as customers by virtue of their receiving this 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.
Disclosure of Interest Statement
Analyst ownership of the stock
Trident
No
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental research and Technical Research. Proprietary
trading desk of MOSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated from MOSL research activity and therefore it can have an independent view with regards to
subject company for which Research Team have expressed their views.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to law,
regulation or which would subject MOSL & its group companies to registration or licensing requirements within such jurisdictions.
For Hong Kong:
This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong Kong Securities and Futures Commission (SFC)
pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH000000412) has an agreement with
Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of research report in Hong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any
investment or investment activity to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these securities,
products and services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not located in Hong Kong & are not conducting Research
Analysis in Hong Kong.
For U.S.
Motilal Oswal 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:
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The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person
or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for informational purpose and may not be used or considered as an offer document or solicitation of
offer to buy or sell or subscribe for securities or other financial instruments. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or
appropriate to your specific circumstances. The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment
objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this document should make such investigations
as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including the merits and risks involved), and should consult its own advisors to
determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. Certain transactions -including those involving futures, options, another derivative
products as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of
the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and should not be treated as endorsement of the
views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make modifications and alternations to this statement as may be required from time to time
without any prior approval. MOSL, its associates, their directors and the employees may from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities
mentioned in this document. They may perform or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities
functions as a separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of information that is already
available in publicly accessible media or developed through analysis of MOSL. The views expressed are those of the analyst, and the Company may or may not subscribe to all the views expressed therein. This document is
being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not
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certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or
representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of the information.
The
person accessing this information specifically agrees to exempt MOSL or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSL or any of its affiliates or
employees responsible for any such misuse and further agrees to hold MOSL or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this
information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022-3980 4263; www.motilaloswal.com. Correspondence Address: Palm Spring
Centre, 2nd Floor, Palm Court Complex, New Link Road, Malad (West), Mumbai- 400 064. Tel No: 022 3080 1000. Compliance Officer: Neeraj Agarwal, Email Id:
na@motilaloswal.com,
Contact No.:022-30801085.
Registration details of group entities.: MOSL: NSE (Cash): INB231041238; NSE (F&O): INF231041238; NSE (CD): INE231041238; BSE (Cash): INB011041257; BSE(F&O): INF011041257; BSE(CD); MSE(Cash): INB261041231;
MSE(F&O): INF261041231; MSE(CD): INE261041231; CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser: INA000007100. Motilal Oswal Asset
Management Company Ltd. (MOAMC): PMS (Registration No.: INP000000670) offers PMS and Mutual Funds products. Motilal Oswal Wealth Management Ltd. (MOWML): PMS (Registration No.: INP000004409) offers wealth
management solutions. *Motilal Oswal Securities Ltd. is a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs, Insurance and IPO products. * Motilal Oswal Commodities Broker Pvt. Ltd. offers Commodities
Products. * Motilal Oswal Real Estate Investment Advisors II Pvt. Ltd. offers Real Estate products. * Motilal Oswal Private Equity Investment Advisors Pvt. Ltd. offers Private Equity products
23 August 2017
30