gladiator stocks – consumption thematic: gst implication

Gladiator Stocks – Consumption Thematic:GST implication augurs wellGST implication augurs well

Scrip I-Direct Code Action Target StoplossKajaria Ceramics KAJCER Buy in the range of 572-585 679.00 523.00Somany Ceramics SOMCER Buy in the range of 605-620 710.00 565.00PVR PVRLIM Buy in the range of 1265-1295 1520.00 1148.00Time Frame: 6 Months

Research AnalystsDh h Sh h dh h h h@i i i itiDharmesh Shah [email protected] Kunte,CMT [email protected] Dagha [email protected]

March 1, 2017

Deal Team – At Your ServiceConsumption Thematic: GST implication augurs well...

The economy seems to be overcoming the demonetisation blues with every passing day given theincremental macro data points, be they better-than-expected GDP growth, higher agricultural growth,auto volumes or stable inflation. This makes us believe demand trends, mainly rural are likely to gathersteam in coming quarters Coupled with this implementation of GST from July 2017 would usher in largesteam in coming quarters. Coupled with this, implementation of GST from July 2017 would usher in largebenefits for organised players, which would get level playing field with the unorganised counterparts.Hence, sectors like building materials, apparels and media can be beneficiaries of the above trend.

To capitalise on this consumption driven theme we have identified actionable opportunities based on our technical screener model, which focuses on identifying the following three broad categories of stocks:

Relative outperformers with robust price structure

Major turnarounds in price structureMajor turnarounds in price structure

Underperformers that are poised at an attractive value area

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Kajaria Ceramics (KAJCER): At the cusp of resuming uptrend..

CMP | 585 00 B i R |572 585 T t | 679 00 St l | 523 00 U id 17%

Key technical observationsThe share price of Kajaria Ceramic resumed its primary uptrend in January 2017 after completing a sizable pricecorrection of over 40% from its October 2016 life-time high of | 742 levels. The sideways consolidation in February2017 is seen as a higher base building process that will act as a launch pad for the next up move. We believe the stocki i l i d f h b lli h lid i d ff d i f di

Stock Data

CMP: | 585.00 Buying Range: |572-585 Target: | 679.00 Stop loss: | 523.00 Upside: 17%

52 Week High / Low 742/423.1050 days EMA 554

200 days EMA 552is attractively poised after one month bullish consolidation and offers good entry opportunity for medium terminvestors with favourable risk reward to ride the next up move.Double Bottom at major value area...The price correction from all-time high of | 742 got arrested precisely above the key value area for the stock placedaround | 430 levels, which is the confluence of following technical parameters:

The previous major breakout area and upper band of February to October 2015 consolidation is around | 43061 8% Fibonacci retracement of the entire up move from August 2015 low of | 303 to life time high of | 742 is

*Recommendation given on i-click to gain on February28, 2017 at 15:19 hrs

y

52 Week EMA 547

Face Value (|) 1Market Capitallisation (| Cr.) 9330

61.8% Fibonacci retracement of the entire up move from August 2015 low of | 303 to life-time high of | 742 isplaced around | 470 region

The stock attracted strong demand at the earmarked value area of | 430 zone, which led to a bullish Double bottomformation marked by the two identical lows formed in November and December 2016. The resolute breakout from thebullish double bottom reversal pattern in January 2017 signalled an end of the corrective phase and resumption of theprimary uptrend.Short term Flag formation provides fresh entry opportunity...

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The sideways consolidation over the last five weeks after the strong breakout rally in January 2017 represents a Flagformation on the weekly chart. A flag pattern is a bullish continuation pattern marking an intermediate pause after astrong rally as bulls gather steam before continuation of the upward momentum. Time wise the stock has alreadycompleted five weeks of consolidation against five week of rally from December 2016 bottom while price wise it hasnot even retraced 38.2% of the corresponding rally. Equal time wise consolidation and lack of price wise correctionhighlights a robust price structure. We believe the 50% retracement of December to January 2017 up move placedaround | 523 will act as a strong base for the stock, going forward.Price performance in last five years

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Momentum oscillators placed at major long term support areaAmong oscillators, the weekly MACD (E-12,26,9) has generated a positive crossover above its nine period and is at thecusp of venturing above its trigger line signalling build up of positive momentum and augurs well for continuance ofthe up move going forward.ConclusionWe believe the stock has concluded a healthy consolidation phase and is set to embark upon fresh up move therebyproviding a good entry opportunity for medium term investors We expect the stock to retrace at least 80% of the

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October to December 2016 correction thereby projecting upsides towards | 679 levels over the medium term.Source: Bloomberg, BSE, ICICIdirect.com Research

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Year

Kajaria Ceramics (KAJCER): Weekly Bar Chart

80% retracement @680

Stock is at the cusp of breaking out of bullish Flag patternon weekly chart signaling continuance of uptrend

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Double bottom at key value area:- Previous breakout @ 430- 61.8% retracement @ 470

52 Weeks EMA

113Steady volumes at Double bottom formation highlight accumulation by stronger hands

Weekly MACD at the cusp of entering into positive territory above its trigger line

Source: Bloomberg, ICICIdirect.com Research

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Kajaria Ceramics (KAJCER): Fundamental view

Fundamental ViewStock Data Fundamental ViewKajaria Ceramics is India's leading tiles player, which enjoys a market share of 10.4%. It has increased its capacity ata CAGR of 14.4% to 68.6 million square metre (MSM) in FY11-17. With the anticipated roll out of GST in July, 2017,we believe pricing difference between organised and unorganised players should come down to 5-7% vs. 15-20%earlier providing level playing field to organised players. Kajaria, being the market leader in organised space, is wellpoised to ride the expansion of organised pie. Furthermore, with favourable structural drivers such as increasingdisposable income & urbanization and government initiatives such as ‘Swachh Bharat Abhiyaan’, ‘Housing for All by2022’ & ‘Smart City Mission’ we believe India’s tiles consumption is set to rise significantly from current low level of

Stock Data

Particular Amount (| crore)Market Capitalization 9,263.9Total Debt 319.0Cash 21.5EV 9 561 4 2022 & Smart City Mission , we believe India s tiles consumption is set to rise significantly from current low level of

0.61 square meter ( vs. 3-4 sq metre / person among peer countries such as China & Brazil). Overall, we believeKajaria’s revenues are expected to grow at a CAGR of 13.1% to | 3207 crore during FY17-FY19E. Additionally,Kajaria also enjoys very strong return ratios of 25%-27% with almost debt free balance sheet lending us thecomfort over future expansion.Market leader in organised Indian tiles industry; set to gain from the organised wave…Kajaria is India’s leading tiles manufacturer, which enjoys market share of 10.4% in FY16. It has increased its

it t CAGR f 14 4% t 68 6 i FY11 17 C tl I di ’ til i d t i | 26 000 FY16

Key Metrics

FY16 FY17E FY18E FY19E

EV 9,561.452 week H/L (|) 740 / 423Equity capital 15.9Face value (|) 1.0

capacity at a CAGR of 14.4% at 68.6 in FY11-17. Currently, India’s tiles industry is ~| 26,000 crore as on FY16,which is ~50% organised. Currently, there is 15-20% pricing difference between organised and unorganisedplayers due to under reporting and clandestine sales by unorganised players. Post roll out of GST in July, 2017,there will be level playing field between organised and unorganised players. Hence, the pricing difference betweenorganised and unorganised players should come down to 5-7%. Kajaria, being the market leader in the organisedtiles market, is well set to benefit from the expanding organised pie wave, going ahead.Structural growth drivers, government initiatives support growth outlook in long term…

P/E 40.4 36.1 29.9 24.7 Target P/E 41.6 37.1 30.8 25.4 EV / EBITDA 21.0 19.2 16.9 14.3 P/BV 10.0 8.3 6.9 5.7 RoNW (%) 24.8 22.9 22.9 23.0 RoCE (%) 27.5 28.0 28.1 28.9

India has emerged as one of the fastest growing tiles market globally (9.8% CAGR during CY05-15). Though therecould be slowdown in the near term due to slowdown in real estate sector and demonetisation, we believe longterm story remains intact for Indian tiles sector. With a favourable structural drivers such as increasing disposableincome & urbanisation and government initiatives such as ‘Swachh Bharat Abhiyaan’, ‘Housing for All by 2022’ &‘Smart City Mission’, we believe India’s tiles consumption is set to rise significantly from current low level of 0.61square meter ( vs. 3-4 sq metre/person among peer countries such as China & Brazil). Overall, we believe Kajaria’srevenues are expected to grow at a CAGR of 13.1% at | 3207 crore during FY17-FY19E.

Financial Highlights

| Crore FY16 FY17E FY18E FY19ENet Sales 2,409 2,509 2,806 3,207 EBITDA 453.7 489.4 541.7 629.8 Net Profit 229.2 256.6 309.8 374.9

Currently available at ~25x FY19E EPS…Kajaria is currently available at ~25x FY19E EPS. Being the market leader in organised space, we believe Kajaria iswell placed to capitalised expanding organised pie post roll out of GST. We believe Kajaria’s revenues are expectedto grow at a CAGR of 13.1% at | 3207 crore. Furthermore, with sharp correction in global gas prices at | 25-27 perSCM vs. | 35-40 per SCM in last 3-4 years, we believe Kajaria should sustain its EBITDA margin at 19-20% duringFY17-19 vs. ~15% during FY10-15. Furthermore, Kajaria also enjoys very strong return ratios of 25-27% withalmost debt free balance sheet lending us the comfort over future expansion.

Source: Company, ICICIdriect.com Research

EPS (|) 14.4 16.1 19.5 23.6

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Somany Ceramics (SOMCER): Bullish flag pattern augurs well...

CMP | 621 00 B i R | 605 620 T t | 710 00 St l | 565 00 U id 16%

Technical ViewThe share price of Somany Ceramics is seen consolidating in a narrow band over the past month after a sharp rallyduring early January 2017. Better-than-expected earnings and visibility for coming quarter helped stock to overcomeworries as the effects of demonetisation were perceived to fade out. We believe that the current consolidation augurs

ll f th t k it l th l tf f th t t h ll it lif hi h l d d | 714 i d

Stock Data

CMP: | 621.00 Buying Range: | 605-620 Target: | 710.00 Stop loss: | 565.00 Upside: 16%

52 Week High / Low 714.40/32550 days EMA 578

200 days EMA 540 well for the stock as it lays the platform for the next up move to challenge its life high placed around | 714 region and,therefore, offers fresh entry opportunity

Base formation at key value area ...The price decline in November–December 2016 got anchored precisely around the key value area of | 470 region. Thestock witnessed a steady base formation through December 2016 at the key value area as distressed selling amiddemonetisation worries got gradually absorbed by value buying. The base formation at key value area of | 470highlighted accumulation by stronger hands as it is the confluence of following technical parameters:


200 days EMA 540

52 Week EMA 530


highlighted accumulation by stronger hands as it is the confluence of following technical parameters:Value of the long term rising 52-week EMA was then placed at | 505Previous major breakout area and yearly high of 2015 is placed at | 460 levels61.8% retracement of February-October 2016 rally (325-714) placed at | 470 region

The stock resolved higher from the base formation in January 2017 ahead of its quarterly earnings and in a processregistered a higher high and higher low on weekly time frame chart.

Potential Bullish Flag continuation pattern

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Potential Bullish Flag continuation pattern ...After a sharp three week run up during January 2017 (| 470-640) the share price has been trading in a narrow band of| 640-590 thereby working out of overbought conditions. Significantly, the three week rally has been retraced only by50% over five week period highlighting bullish undertone in the stock. We believe the stock looks poised for upwardbreakout after a healthy consolidation and therefore offers fresh entry opportunity over medium term

Bullish crossover on MACD oscillator confirms reversal on price front...Among oscillators the weekly MACD (E-12 26 9) has generated a positive crossover above its 9 period average after

Price performance in last five years

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Among oscillators, the weekly MACD (E-12,26,9) has generated a positive crossover above its 9 period average afterrebounding from its trigger line. It highlights build up of positive momentum and confirms strength in current upmove that augurs well for the stock going forward

ConclusionBased on the aforementioned technical observations, we believe the stock has concluded a healthy corrective phase.We expect the stock to enter a sustainable up move from here on and head towards target of | 710 levels over themedium term as it is the life high for the stock. It therefore offers a good entry opportunity for medium term investors

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Source: Bloomberg, BSE, ICICIdirect.com Research

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Somany Ceramics (SOMCER): Weekly Bar Chart

714Stock is poised to break out of Bullish Flagcontinuation pattern and likely to challenge life highs Price Target @ |710

Bullish Flag

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Base formation at key valuearea of |840:-Rising 52 week EMA-Previous breakout area-61.8% retracement

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Steady volumes during base formation and rallies indicate bullish bias

Bullish crossover on MACD above its trigger line indicates build up of positive momentum


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Somany Ceramics (SOMCER): Fundamental view

Fundamental ViewFundamental ViewSomany Ceramics (Somany) has emerged as the second largest tiles player in the Indian tiles industry. Somanyexpanded its capacity aggressively from 19.1 million square metre (MSM) in FY11 to 60.3 MSM (includingoutsourcing capacity of ~9 MSM) currently, largely through a capex light joint venture model. The company hasover the years focused on improving its product mix by increasing share of value added products like polishedvitrified tiles (PVT) and glazed vitrified tiles (GVT). The share of value added products increased from ~13% in FY11to ~46% in FY16 leading to EBITDA margin expansion and superior bottomline growth. Consequently, its topline,bottomline grew robustly at 19 1% 22 0 CAGR to | 1701 1 crore | 64 7 crore in FY11-16 Even going forward

Stock Data

Particular Amount (| crore)Market Capitalization 2,619.1Total Debt 243.4Cash 18.3EV 2 783 0 bottomline grew robustly at 19.1%, 22.0 CAGR to | 1701.1 crore, | 64.7 crore in FY11 16. Even going forward,

Somany’s strategy to grow via the JV route without stressing its balance sheet and focus on the value addedsegment would significantly improve its revenues, margins, terms of trade and return on capital employed.Leading player in organised Indian tiles industry; set to gain from organised wave…Somany is India’s leading tiles manufacturer, which enjoys market share of 6.6% in FY16. Currently, India’s tilesindustry is ~| 26,000 crore as on FY16, which is ~50% organised. Currently, there is 15-20% pricing differencebetween organised and unorganised players due to under reporting and clandestine sales by unorganised players.P t ll t f GST i J l 2017 th ill b l l l i fi ld b t i d d i d l

Key Metrics

(x) FY16 FY17E FY18E FY19E

EV 2,783.052 week H/L (|) 714 / 326Equity capital 8.5Face value | 2

Post roll out of GST in July, 2017, there will be level playing field between organised and unorganised players.Hence, the pricing difference between organised and unorganised players should come down to 5-7%. Though,there could be slowdown in the near term due to slowdown in real estate sector and demonetisation, we believelong term story remains intact for Indian tiles sector. With favourable structural drivers such as increasingdisposable income & urbanisation and government initiatives such as ‘Swachh Bharat Abhiyaan’, ‘Housing for All by2022’ & ‘Smart City Mission’, we believe India’s tiles consumption is set to rise significantly from current low level of0.61 square meter (vs. 3-4 sq metre/person among peer countries such as China & Brazil). Consequently, Somany isset to benefit from opportunities arising from these initiatives

( )P/E 40.5 28.3 23.6 19.4 Target P/E 42.9 30.6 25.6 21.0 EV / EBITDA 20.4 16.0 13.4 11.1 P/BV 6.1 5.1 4.3 3.7 RoNW (%) 15.1 18.0 18.4 19.0 RoCE (%) 15.5 18.9 20.3 22.1

set to benefit from opportunities arising from these initiatives.Capacity expansion on track…Currently, Somany has a manufacturing capacity of 60.3 MSM (inclusive of outsourced capacity of 9 MSM).Furthermore, Somany is undertaking expansion at its vintage tiles facility of polished vitrified double charged tilesfrom 3 MSM to 4.8 MSM. It is expected to be completed by Q1FY18 post which the company would have access tocapacity of ~62 MSM. Even, the company is expanding its annual manufacturing capacity in the sanitarywaresegment from 3 lakh pieces to 9 lakh pieces, which is on track to be completed by Q1FY18. Recently, the companyl h d d i i i di i i f hi h i i d

Financial Highlights

(| Crore) FY16 FY17E FY18E FY19ENet Sales 1,710 1,774 2,050 2,345 EBITDA 135.3 165.2 195.0 227.8 N t P fit 64 7 90 6 108 6 132 4 launched some new products in its sanitaryware division for which it received a strong response.

Currently trading at 20x FY19E EPS…Somany is currently available at ~20x FY19E EPS. Being a leading player in organised space, we believe Somany iswell placed to capitalised expanding organised pie post roll out of GST. We believe Somany’s revenues areexpected to grow at a CAGR of 11.1% at | 2345 crore. Furthermore, Somany also enjoys very strong return ratios of20-22% with lean balance sheet lending us the comfort over future expansion.


Net Profit 64.7 90.6 108.6 132.4 EPS (|) 15.3 21.4 25.6 31.1

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PVR (PVRLIM): Faster retracement of major falling segment augurs well...

CMP | 1295 00 B i R |1265 1295 T t | 1520 00 St l | 1148 00 U id 19%

Technical ViewThe share price of PVR, a leading multiplex player, witnessed strong come back amid renewed appetite amonginvestors in early January 2017. Stronger-than-expected earnings in Q32017 and a shift in perception ofdemonetisation effect propelled the stock near its life-time highs. Further a narrow range consolidation over past six

k lif ti hi h i l h lth ti d ff f h t t it

Stock Data

CMP: | 1295.00 Buying Range: |1265-1295 Target: | 1520.00 Stop loss: | 1148.00 Upside: 19%

52 Week High / Low 1340/662.0550 days EMA 1234

200 days EMA 1118 weeks near life-time highs signals healthy correction and offers fresh entry opportunity

Support at key value area highlights continued buying appetite...The corrective price decline off the September 2016 all time peak of |1334 got anchored near key value area of | 1000region highlighting emergence of strong demand for the stock and resulted in a higher bottom formation. Theconfluence key technical parameters converging around |1000 region made this a key value area for stock based onfollowing observations:

V l f th l t i i 52 k EMA th l d t | 1023


00 d ys 8

52 Week EMA 1093


Value of the long term rising 52-week EMA then placed at | 102350% retracement of the preceding up move | 662-1334 was placed at | 998

We believe the higher bottom formed at January 2017 low (|1145) and the 50% retracement of the December-January up move placed around |1150 region will act as a strong base for the stock going forward

Robust price structure validated by faster retracement...

The key technical aspects of price structure analysis is the time taken by corrections and corresponding rallies Price

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The key technical aspects of price structure analysis is the time taken by corrections and corresponding rallies. Pricewise, the major rally in 2016 saw the stock more than double from a low of |662 in March to an all time high of |1334in September 2016 taking just six months. Meanwhile in the subsequent corrective phase the stock has alreadycompleted five months while price wise it has retraced just 50% of the preceding six month rally. The shallow pricewise correction while consuming almost equal amount of time taken by rally highlights the bullish price structure.Furthermore, the four month during September – January 2017 (| 1334-1006) was fully retraced in just one monthhighlighting resumption of strong buying momentum and corroborates the bullish view over medium termPrice performance in last five years

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Momentum oscillator confirms inherent strength in the trend...Among oscillators, the weekly 14 period RSI has generated a positive cross-over and continues to trend uphighlighting inherent strength in the underlying trend and confirms the overall bullish price structure.

ConclusionBased on the aforementioned technical observations, we believe the stock is at the cusp of resuming its primaryuptrend after conclusion of the secondary correction We expect the stock to resolve higher from here on and head

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towards our target of |1520 over the medium term, as it is the 161.8% external retracement of September – Januarydecline (| 1334-1006)Source: Bloomberg, BSE, ICICIdirect.com Research

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PVR (PVRLIM): Weekly Bar Chart

1334

Faster retracement of corrective decline highlights bullish price structure

161.8% retracement @ 1535

6 Month Rally 1006

Faster retracementin 1 month

52week EMA

Key value area of |1000 :- Rising 52week EMA- 50% retracement of March-S b ll

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5 month correction

52week EMA September rally

14 week RSI has generated a bullish crossover above its nineperiod average corroborating bullish price structure


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PVR(PVRLIM): Fundamental view

Fundamental ViewFundamental ViewPVR is a leading multiplex player with a screen count of 562 (including DT Cinemas) as on Q3FY17 and market shareof ~25% of total multiplex screens in India, with multiplex revenue share of 17-22% (Bollywood) and 30-35%(Hollywood). PVR continues to outpace its peers in terms of superior earnings growth and footfalls garnered andcommands superior valuation owing to its leadership position. The company has been able to pass on price hikes interms of ATP and SPH and also gets a premium by advertisers owing to its footfalls base of 75.2 million. Wecontinue to remain positive on the Indian multiplex Industry given the demographics, rising income levels and thebenefits that could accrue from GST Going ahead we expect consolidated revenue and PAT to grow at a CAGR of

Stock DataParticulars AmountMarket Capitalization (| Crore) 6,127.6 Total Debt (FY16) (| Crore) 574.1 Cash (FY16) (| Crore) 24.4 EV 6,434.4 52 week H/L 1340/ 640 benefits that could accrue from GST. Going ahead, we expect consolidated revenue and PAT to grow at a CAGR of

15.6% and ~6.4% to | 2834.8 crore and | 172.6 crore, respectively, over FY16-19E.Market leader in the multiplex space with 562 screens, ability to take price hikesPVR is a leading multiplex player with a screen count of 562 screens (inclusive of DT Cinema screens) and has beenconsistently augmenting its screen presence on a pan – India basis. PVR enjoys a first mover advantage and boastsof presence in key catchment areas. The company has been able to take consistently take price hikes and we expectthe company to report ATP’s of | 206 & | 213 in FY18E & FY19E, respectively, which will lead to a 14.1% CAGR inth t ti k ti FY16 19E t | 1505 7 Th i l t tl i t ith

Key Metrics

Equity capital 46.7 Face value 10.0 MF Holding (%) 12.7 FII Holding (%) 31.0

FY16 FY17E FY18E FY19E the net ticketing revenues over FY16-19E to | 1505.7 crore. The company is also constantly coming out withinnovative offerings in terms of its F&B offerings and has hence being able to see an increase in the Spends perHead (SPH). Looking at the strong management focus on the segment and continuous innovation, we expect theF&B revenues to grow at 17.7% CAGR over FY16-19E aided by 7.0% CAGR in SPH to | 86.9.Strong Content pipeline ahead to boost the ticketing revenuesThe content line up remains strong ahead with movies such as Sarkaar 3, Phillauri, Jagga Jasoos etc which willaccelerate the footfalls for PVR. There has been a shift from cash bookings to digital bookings with the latter being

FY16 FY17E FY18E FY19EP/E 51.6 59.0 45.6 35.5Target P/E 58.0 66.4 51.3 39.9 EV / EBITDA 19.2 18.5 15.0 12.5P/BV 7.0 6.3 5.6 4.9 RoNW (%) 14.3 10.9 12.3 13.7RoCE (%) 15.6 13.9 15.7 17.9

65.0% of their overall bookings post demonetization and hence making the company more resilient from the aftereffects of demonetization. The trend is expected to continue. We expect PVR to exhibit footfall growth of 10.2%CAGR in FY16-19E to 93.2 million aided by new screen additions & good content.Advertisement revenues remains superior than peersPVR has been consistently delivering on the advertisement revenue front owing to its superior footfalls and higherpan India reach in terms of screen distribution. The advertising contracts are signed in advance and are highlyEBITDA accretive in nature. PVR with its strong presence is expected to post 17.2% CAGR (FY16-19E) to | 332.3

Financial Highlights| Crore FY16 FY17E FY18E FY19ENet Sales 1,869 2,152 2,498 2,835 EBITDA 335 370 448 525 Net Profit 119 104 134 173 g p p p ( )

crore in its advertisement revenues.Performance justifies its “numero uno” status, Maintain BUYPVR continues to outpace its peers in terms of superior earnings growth and footfalls garnered and commandssuperior valuation owing to its leadership position. The company has been able to pass on price hikes in terms ofATP and SPH and also gets a premium by advertisers owing to its footfalls base of 75.2 million. We continue toremain positive on the Indian multiplex Industry given the demographics, rising income levels and the benefits thatcould accrue from GST We maintain BUY at 14x FY19E EV/EBITDA arriving at a target price of | 1475


EPS (|) 25.4 22.2 28.8 37.0

could accrue from GST. We maintain BUY at 14x FY19E EV/EBITDA, arriving at a target price of | 1475.

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Strategy Follow up

Open Recommendations:

Date Scrip Name Rec Price Target Stoploss CMPReturn till date

(%)23-Feb-17 Johnson controls Hitachi 1380 1645 1215 1425 3.3%23-Feb-17 Whirlpool 1040 1230 942 1021 -1.8%23-Feb-17 Symphony 1300 1560 1120 1312 0.9%

Summary Performance - Recommendations till date Open Recommendations 3

Total Recommendations 120 Yield on Positive recommendations 19.0%Cl d R d i Yi ld N i d i 8 0%Closed Recommendations 117 Yield on Negative recommendations -8.0%

Positive Recommendations 82Strike Rate 70%

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Notes…

• It is recommended to enter in a staggered manner within the prescribed range provided in the report

• Once the recommendation is executed, it is advisable to keep strict stop loss as provided in the report on closing basis.

• The recommendations are valid for six months and in case we intend to carry forward the position, it will be communicated through separate mail.

Trading portfolio allocationTrading portfolio allocation

• It is recommended to spread out the trading corpus in a proportionate manner between the various technical research products

• Please a oid allocati g the e ti e t adi g co p s to a si gle stock o a si gle p od ct • Please avoid allocating the entire trading corpus to a single stock or a single product segment

• Within each product segment it is advisable to allocate equal amount to each recommendationF l Th ‘D il C ll ’ d i 3 i d d i I i • For example: The ‘Daily Calls’ product carries 3 to 4 intraday recommendations. It is advisable to allocate equal amount to each recommendation

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Recommended product wise trading portfolio allocation

Duration

Daily Calls 8% 2-3% 3-4 Stocks 0.5-1% 2-3% Intraday

Number of CallsReturn Objective

Frontline Stocks Mid Cap StocksProduct Product wise

allocation

AllocationsMax allocation in

1 Stock

Stocks on the Move 6% 3-5% 7-10 Per Months 7-10% 10-15% 3 Months

Weekly Calls 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week

Weekly Technicals 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week

Monthly Call 15% 5% 2-3 Stocks 7-10% 10-15% 1 Month

Monthly Technical 15% 2-4% 5-8 Stocks 7-10% 10-15% 1 Month

Techno Funda 15% 5-10% 1-2 Stocks 10% and above 15% and above 6 Months

Gladiator Stocks 15% 5 10% 1 2 Stocks 15% and above 20% and above 6 MonthsGladiator Stocks 15% 5-10% 1-2 Stocks 15% and above 20% and above 6 Months

Cash 10% -100%

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Pankaj Pandey Head – Research [email protected]

ICICIdirect.com Research Desk,ICICI Securities Limited,1st Floor Akruti Trade Centre1st Floor, Akruti Trade Centre,Road No 7, MIDCAndheri (East)Mumbai – 400 [email protected]

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DisclaimerANALYST CERTIFICATION

We /I Dharmesh Shah Dipesh Dagha Nitin Kunte Pabitro Mukherjee Vinayak Parmar Research Analysts authors and the names subscribed toWe /I, Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee, Vinayak Parmar Research Analysts, authors and the names subscribed tothis report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) orsecurities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) orview(s) in this report.Terms & conditions and other disclosures:ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stockbrokering and distribution of financial products. ICICI Securities Limited is a SEBI registered Research Analyst with SEBI Registration Number –g p g y gINH000000990.ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India’s largest private sector bank and has its varioussubsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management,etc. (“associates”), the details in respect of which are available on www.icicibank.comICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India.We and our associates might have investment banking and other business relationship with a significant percentage of companies covered by ourInvestment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts and their relatives from

i i i fi i l i i h i i d i i f i h h lmaintaining a financial interest in the securities or derivatives of any companies that the analysts cover.The information and opinions in this section have been prepared by ICICI Securities and are subject to change without any notice. The report andinformation 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 of ICICISecurities. While we would endeavour to update the information herein on reasonable basis, ICICI Securities is under no obligation to update orkeep the information current. Also, there may be regulatory, compliance or other reasons that may prevent ICICI Securities from doing so. Non-rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicablerated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicableregulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this company, or incertain other circumstances.The research recommendations are based on information obtained from public sources and sources believed to be reliable, but no independentverification has been made nor is its accuracy or completeness guaranteed. These research recommendations and information herein is solely forinformational purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities orother financial instruments. ICICI Securities will not treat recipients as customers by virtue of their receiving these recommendations. Nothing inthis section constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriateto your specific circumstances. The securities discussed and opinions expressed herein may not be suitable for all investors, who must maketheir own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not betaken in substitution for the exercise of independent judgment by any recipient. The recipient should independently evaluate the investment risks.The value and return on investment may vary because of changes in interest rates, foreign exchange rates or any other reason. ICICI Securitiesaccepts no liabilities whatsoever for any loss or damage of any kind arising out of the use of these recommendations. Past performance is notnecessarily a guide to future performance Investors are advised to see Risk Disclosure Document to understand the risks associated before

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necessarily a guide to future performance. Investors are advised to see Risk Disclosure Document to understand the risks associated beforeinvesting in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are notpredictions and may be subject to change without notice.

DisclaimerICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have beenmandated by the subject company for any other assignment in the past twelve months.ICICI Sec ities o its associates ight ha e ecei ed a co pe satio f o the co pa ies e tio ed he ei d i g the pe iod p ecedi gICICI Securities or its associates might have received any compensation from the companies mentioned herein during the period precedingtwelve months from the date of these recommendations for services in respect of managing or co-managing public offerings, corporate finance,investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchantbanking or brokerage services from the companies mentioned herein in the past twelve months.ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICISecurities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or thirdSecurities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or thirdparty in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts and their relatives haveany material conflict of interest at the time of publication of this reports.It is confirmed that Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee and Vinayak Parmar, Research Analysts giving theserecommendations have not received any compensation from the companies mentioned herein in the preceding twelve months.Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactionsICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the

/ i i d h i f h l d f h h di h bli i f h h d icompany/companies mentioned herein as of the last day of the month preceding the publication of these research recommendations.Since Associates (ICICI group companies) of ICICI Securities are engaged in various financial service businesses, they might have financialinterests or beneficial ownership in various companies including the subject company/companies mentioned herein.It is confirmed that Research Analysts do not serve as an officer, director or employee or advisory board member of the companies mentionedherein.ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented herein.Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned hereinNeither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned herein.We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysisactivities.This report or recommendations are not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of orlocated in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law,regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securitiesdescribed herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession thisdocument may come are required to inform themselves of and to observe such restriction.

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gladiator stocks – consumption thematic: gst implication

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