motilaloswal itc 30july 2014
TRANSCRIPT
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 1/8
29 July 2014
1QFY15 Results Update | Sector: Consumer
ITC
Gautam Duggad ([email protected]); +91 22 3982 5404
Manish Poddar ([email protected]); +91 22 3027 8029
BSE SENSEX S&P CNXCMP: INR357 TP: INR400 Buy
25,991 7,749
Bloomberg ITC IN
Equity Shares (m) 7,818.4M.Cap. (INR b)/(USD b) 2,789/46.4
2-Week Range (INR) 387/285
1, 6, 12 Rel. Per (%) 8/-17/-35
Financials & Valuation (INR Billion)
Y/E MAR 2015E 2016E 2017E
ales 374.1 429.1 489.5
EBITDA 141.2 162.9 187.0
dj. PAT 100.7 116.8 134.5
dj. EPS (INR) 12.9 14.9 17.2
EPS Gr. (%) 16.3 16.1 15.1
BV/Sh.(INR) 31.7 34.4 37.5
RoE (%) 40.6 43.4 45.8
RoCE (%) 57.0 61.2 64.9
P/E (x) 27.7 23.9 20.7
P/BV (x) 11.2 10.4 9.5
ITC’s 1QFY15 results were largely in-line though seasonality in Agri revenues
resulted in 9.5% beat on sales vs. our estimates. 1Q15 net sales, EBITDA and PATcame in at INR92.5b (est. INR84.5b), INR32.8b (est. INR31.9b) and INR21.9b (est.
INR 22b), up 24.9%, 17.4% and 15.6%, respectively.
Cig volumes declined 2.5% with net sales growth of 18.8% to INR42b while Cig
EBIT grew robust 21.4% and posted 140bp net EBIT margin expansion to 64.8%.
ITC has discontinued sharing gross sales figures from this quarter.
EBITDA grew 17.4% to INR 32.8b; margins contracted 220bps to 35.4 due to mix
deterioration post higher growth in Agri sales and EBIT losses in Hotels division
due to higher depreciation expenses on revision of useful life.
Non-Cig FMCG posted 10.9% sales growth (lowest since 1QFY10) with mid single
digit volume growth; impacted by weak macros with moderation in Biscuits andNoodles category (high single digit growth vs. high teens earlier). Lifestyle and
matches business have also witnessed sharp moderation. The segment reported a
loss of INR156m.
Agri revenues grew 50.6% YoY to INR32.9b on account of higher trading in non-
leaf tobacco portfolio. Leaf tobacco sales were impacted due to change in order
pattern and margins contracted 300bp due to mix deterioration. Hotels
continued to suffer with lower occupancies (shift in IPL out of India in 2014) and
lower beverage sales during elections and posted 0.5% revenue decline with
sharp 840bps EBIT margin contraction. Paper revenues grew 10.8% YoY to
INR12.8b with 30bp margin contraction to 21.3%.
Continued robust Cig EBIT growth and margin expansion are the key highlights of
the quarter. Given the unprecedented third consecutive year of ~20% excise hike
in cigarettes, we expect delayed volume recovery in Cig. Reiterate Buy with a
Target Price of INR400 (27x FY16E).
Investors are advised to refer through disclosures made at the end of the Research Report.
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 2/8
29 July 2014 2
ITC
Sales beat driven by Cig & Agri division: Cig volume decline 2.5%
1QFY15 revenues grew 24.8% to INR92.4b (est. INR84.5b), led by 18.8% and
50.6% growth in Cigarettes Agri division, respectively. Non-Cig FMCG and Paper
business sales grew 10.9% and 10.8% respectively while Hotels underperformed
with 0.5% YoY revenue decline.
Cigarette volumes declined 2.5% in our view but margins expanded 140bp to
64.8%.
Gross margins contracted by 430bp largely led by raw material inflation and mix
deterioration due to higher growth in Agri business.
EBITDA posted 17.4% YoY growth to INR32.8b (est. INR31.9b).
Adj. PAT posted 15.6% growth to INR21.9b (est. INR22.0b), slightly lower than
the 18.2% growth in PBT as tax rate expanded 150bps YoY to 33%.
Segmental Performance
1QFY13 2QFY13 3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15
Sales (INR m)
Cigarettes 33,042 33,852 36,574 36,232 35,374 37,238 41,161 40,788 42,011
FMCG - Others 14,731 16,908 17,827 20,362 17,447 19,622 20,778 23,145 19,346
Hotels 2,324 2,170 3,095 3,155 2,499 2,470 3,154 3,205 2,487
Agri business 16,914 20,239 16,310 18,545 21,890 17,725 17,864 20,042 32,961
Paper and packaging 10,587 10,590 10,616 10,575 11,631 11,787 12,574 12,612 12,885
Sales growth (YoY)
Cigarettes 15.0 14.0 13.1 11.5 7.1 10.0 12.5 12.6 18.8
FMCG - Others 23.0 26.1 30.1 26.0 18.4 16.1 16.6 13.7 10.9
Hotels 0.8 2.8 11.0 10.4 7.5 13.8 1.9 1.6 -0.5
Agri business -0.9 41.1 43.1 31.1 29.4 -12.4 9.5 8.1 50.6
Paper and packaging 10.3 5.3 8.5 7.9 9.9 11.3 18.5 19.3 10.8
Volume growth (YoY)
Cigarettes 1.5 0.5 1.5 2.5 -2.0 -2.0 -2.0 -3.0 -2.5
EBIT (INR m)
Cigarettes 18,998 20,802 22,335 21,124 22,417 24,117 26,526 25,519 27,218
FMCG - Others -388 -303 -240 119 -189 -127 104 431 -156
Hotels 262 153 555 406 89 87 622 599 -121
Agri business 1,714 2,597 1,726 1,275 1,993 2,846 2,054 1,455 2,025
Paper and packaging 2,647 2,825 2,286 1,881 2,516 2,208 2,317 1,884 2,749
EBIT growth (YoY)
Cigarettes 20.5 20.3 21.1 20.2 18.0 15.9 18.8 20.8 21.4
FMCG - Others -49.1 -45.8 -48.8 -171.2 -51.3 -58.1 -143.2 263.0 -17.6
Hotels -48.9 -64.8 -45.5 -51.0 -65.9 -43.0 12.1 47.3 -235.2
Agri business 9.1 8.8 21.9 20.8 16.3 9.6 19.0 14.1 1.6
Paper and packaging 16.6 -2.5 1.9 -3.9 -5.0 -21.9 1.4 0.1 9.3
EBIT Margin (%)
Cigarettes 57.5 61.4 61.1 58.3 63.4 64.8 64.4 62.6 64.8
FMCG - Others -2.6 -1.8 -1.3 0.6 -1.1 -0.6 0.5 1.9 -0.8
Hotels 11.3 7.1 17.9 12.9 3.6 3.5 19.7 18.7 -4.9
Agri business 10.1 12.8 10.6 6.9 9.1 16.1 11.5 7.3 6.1
Paper and packaging 25.0 26.7 21.5 17.8 21.6 18.7 18.4 14.9 21.3
Source: Company, MOSL
Cigarette volumes decline ~2.5%; 140bp EBIT margin expansion
1QFY15 cigarette volumes declined 2.5%. Two consecutive years of sharp pricehikes in a weak macro backdrop is delaying the volume recovery, in our view.
We expect Cig volume growth to remain subdued in FY15 (estimate 3.3%
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 3/8
29 July 2014 3
ITC
volume decline for the year) as third consecutive year of steep excise increase
will result in fresh round of price hikes. Our channel checks indicate price hikes
to take effect in another fortnight.
While Cig volume decline has remained in 2.5-3% band for both 4Q14 and 1Q15,
net sales growth of the division has improved significantly from 12.6% in 4Q14
to 18.8% in 1Q15. We note that ITC has discontinued sharing gross sales figures
from this quarter.
Net EBIT Margin expanded 140bp to 64.8% on the back of price increases and
cost containment. Thus, Cigarette EBIT posted robust 21.4% YoY growth for
1Q15.
Cig volumes declined 2.5%
Source: Company, MOSL
EBIT growth remains robust
Source: Company, MOSL
FMCG – Others: Sales growth at 20 quarter low
FMCG others division posted 10.9% sales growth led by mid single digit volume
growth while segment reported a loss of INR156mn.
Sales growth was lowest since 1QFY10, impacted by overall consumption
slowdown with single digit growth in biscuits and noodles category vs. high
teens earlier. Lifestyle and matches business have also witnessed sharp
moderation. Atta and Notebooks segment outperformed.
Incremental EBIT margins stood at 1.8%.
10.9% sales growth, lowest since 1Q10
Source: Company, MOSL
Incremental EBIT margins at 1.8%
Source: Company, MOSL
-3.5
-0.5
2.5
-2.0
8.07.5
5.0 5.0
1.50.5
1.52.5
-2.0-4.0
-2.0-3.0-2.5
1 Q F Y 1 1
2 Q F Y 1 1
3 Q F Y 1 1
4 Q F Y 1 1
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
Cig volume growth (%)
1 5
. 5
1 5
. 7
1 6
. 0
1 6
. 5
1 7
. 0
1 7
. 5 2 0
. 8
1 8
. 6 2 0
. 3
1 9
. 5 2 0
. 5
2 0
. 3 2 1
. 1
2 0
. 2
1 8
. 0
1 5
. 9 1 8
. 8 2 0
. 8 2 1 . 4
3 Q F Y 1 0
4 Q F Y 1 0
1 Q F Y 1 1
2 Q F Y 1 1
3 Q F Y 1 1
4 Q F Y 1 1
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
Cig EBIT growth (%)
1 4
2 3
3 4
3 2
. 4
2 2
. 5 2 3
. 8
1 6
. 8
1 9
. 4
2 7
. 2
2 4
. 1
2 2
. 9
2 2
. 6 2 5
. 7 3 0
. 1
2 6
. 0
1 8
. 4
1 6
. 1
1 6
. 6
1 3
. 7
1 0
. 9
2 Q F Y 1 0
3 Q F Y 1 0
4 Q F Y 1 0
1 Q F Y 1 1
2 Q F Y 1 1
3 Q F Y 1 1
4 Q F Y 1 1
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
Sales Growth (%)
1 , 9
5 4
2 , 8
7 6
2 , 6
6 5
3 , 0
1 7
2 , 7
2 0
3 , 4
5 5
4 , 1
2 0
4 , 1
9 7
2 , 7
1 6
2 , 7
1 4
2 , 9
5 1
2 , 7
8 3
1 , 9
0 06.6
3.8
10.0
17.0
13.8
7.45.5
6.8 7.3 6.5
11.6 11.2
1.8
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
Incr Sales (INR m) Incr EBIT Margin (%)
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 4/8
29 July 2014 4
ITC
EBIT loss attributed to higher brand investments and low operating leverage
Source: MOSL, Company
Agri business: Boosted by non-Leaf tobacco trading
Agri revenues grew 50.6% YoY to INR32.9b on account of higher trading in
wheat and soya as leaf tobacco sales were impacted due to change in orderpattern. EBIT margin contracted by 300bp to 6.1% due to mix deterioration.
Agri margins down 300bp YoY due to mix deterioration
Source: Company, MOSL
Agri contribution to revenue
Source: Company, MOSL
Hotels: Revenues down marginally; material margin contraction
Hotels revenues declined marginally (down 0.5% YoY) impacted by lower
occupancies (shift in IPL out of India in 2014) and lower beverage sales during
elections.
Division reported EBIT loss of INR 121mn with INR143mn impact coming from
higher depreciation due to change in accounting standard. Additionally, it also
bore the start up costs of My Fortune property in Bengaluru during 1Q15.
The segment witnessed material EBIT margin contraction of 840bp.
- 8 9 3
- 6 6 9
- 7 3 6
- 6 7 8
- 7 6 3 - 5
5 9
- 4 6 8
- 1 6 7
- 3 8 8
- 3 0 3
- 2 4 0
1 1 9
- 1 8 9
- 1 2 7
1 0 4
4 3 1
- 1 5 6
1 Q F Y 1 1
2 Q F Y 1 1
3 Q F Y 1 1
4 Q F Y 1 1
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
EBIT (INR m)
9.2
16.6
12.4
7.510.1
12.810.6
6.99.1
16.1
11.5
7.36.1
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
EBIT Margins (%)
28.7%
24.0%
18.4%20.6%
25.4%28.3%
21.4%22.7%
29.8%
22.8%20.7%
21.9%
36.0%
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
Agri contri to ITC sales
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 5/8
29 July 2014 5
ITC
Hotel margins contract 840bp YoY
Source: Company, MOSL
Hotel revenues declined marginally YoY
Source: Company, MOSL
Paper: capacity utilization improves; margins contract 30bp
Paper and Paperboard business sales were up 10.8% to INR12.8b driven by
volumes and product mix. As per management, capacity utilization improvedduring the quarter
EBIT margins down 30bp YoY to 21.3% led by higher input costs while EBIT
posted 9.3% growth.
Paper segment sales grew at 10.8%
Source: MOSL, Company
Valuation and view: Reiterate Buy with TP of INR400
Continued robust Cig EBIT growth and margin expansion are the key highlights
of the quarter.
Within our overall cautious sector stance, we find ITC relatively better placed as
it offers the best earnings predictability driven by resilient Cig EBIT growth of
18-20%.
Given the unprecedented third consecutive year of ~20% excise hike in
cigarettes, we expect volume recovery in Cig to get delayed.
Maintain our top sector pick and reiterate Buy with a Target Price of INR400
(27x FY16E).
22.3 20.6
36.5
29.0
11.37.1
17.912.9
3.6 3.5
19.7 18.7
-4.9
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
EBIT Margins (%)
2 , 3
0 5
2 , 1
1 1
2 , 7
8 7
2 , 8
5 8
2 , 3
2 4
2 , 1
7 0
3 , 0
9 5
3 , 1
5 5
2 , 4
9 9
2
, 4 7 0
3 , 1
5 4
3 , 2
0 5
2 , 4
8 7 5 1 3
4 3 4 1
, 0 1 7
8
2 9
2 6 2
1 5 3 5
5 5
4 0 6
8 9
8 7 6 2
2
5 9
9
- 1 2 1
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
Sales (INR m) EBIT (INR m)
2 3
. 7
2 8
. 8
2 2
. 9
2 0
. 0 2 5
. 0
2 6
. 7
2 1
. 5
1 7
. 8
2 1
. 6
1 8
. 7
1 8
. 4
1 4
. 9
2 1
. 3
20.9
9.411.5
6.9
10.3
5.38.5
7.9
9.9 11.3
18.5 19.3
10.8
1 Q F Y 1 2
2 Q F Y 1 2
3 Q F Y 1 2
4 Q F Y 1 2
1 Q F Y 1 3
2 Q F Y 1 3
3 Q F Y 1 3
4 Q F Y 1 3
1 Q F Y 1 4
2 Q F Y 1 4
3 Q F Y 1 4
4 Q F Y 1 4
1 Q F Y 1 5
EBIT Margins (%) Sales growth (%)
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 6/8
29 July 2014 6
ITC
ITC: an investment profileCompany descriptionITC is an associate of BAT (British American Tobacco)
controls more than 2/3rd of the cigarette market in
India. ITC has emerged as a diversified conglomerate
with leading presence in Paperboards, Hotels andProcessed foods. E-Choupal, the agri rural initiative of
the company has been widely appreciated for its
foresight in harnessing the potential in the rural market.
Key investment arguments
Strong pricing power due to dominant market share
in the cigarettes.
Offers best earnings visibility in the sector.
FMCG business improving profitability.
Key investment risks
Taxation related risks though Excise and VAT hikes
for FY14 are announced.
Lower than expected Cig volume growth.
Recent developments
ITC entered into Deodorants category with the
launch of its brand Engage.
It launched 3 offerings in 64mm segment
Valuation and view
The stock trades at 27.7x FY15 and 23.9x FY16
estimates. Maintain Buy with TP of INR400 (27x
FY16E EPS).
Sector view
Sector stance remains cautious with preference for
companies with high earnings visibility and lowcompetitive intensity.
Lagged impact of GDP slowdown is reflecting in the
sector with moderation in volume growth.
Relatively we prefer ITC, Emami and Britannia.
Comparative valuations
ITC HLL Nestle
P/E (x) FY15E 27.7 37.0 40.3
FY16E 23.9 33.2 34.1
P/BV (x) FY15E 11.2 27.2 23.4
FY16E 10.4 23.9 20.1
EV/Sales (x) FY15E 7.0 4.6 4.9
FY16E 6.1 4.1 4.3
EV/EBITDA (x) FY15E 18.6 39.7 19.5
FY16E 16.0 35.6 17.8
EPS: MOSL forecast v/s consensus (INR)
MOSL Consensus Variation
Forecast Forecast (%)
FY15 12.9 12.9 0
FY16 14.9 15.2 -1.8
Target price and recommendation
Current Target Upside Reco.
Price (INR) Price (INR) (%)
357 400 12.0 Buy
Shareholding pattern (%)Jun-14 Mar-14 Jun-13
Promoter 0.0 0.0 0.0
DII 35.0 34.7 33.8
FII 19.5 19.5 19.9
Others 45.5 45.8 46.3
Note: FII Includes depository receipts
Stock performance (1-year)
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 7/8
29 July 2014 7
ITC
Financials and valuation
8/11/2019 MotilalOswal ITC 30July 2014
http://slidepdf.com/reader/full/motilaloswal-itc-30july-2014 8/8
29 July 2014 8
ITC
Disclosures
This research report has been prepared by MOSt to provide information about the company(ies) and sector(s), if any, covered in the report and may be distributed by it and/or its affiliated company(ies). This
report is for personal information of the select recipient and does not construe to be any investment, legal or taxation advice to you. This research report does not constitute an offer, invitation or inducement to
invest in securities or other investments and Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been
furnished to you solely for your general information and should not be reproduced or redistributed to any other person in any form. This report does not constitute a personal recommendation or take into
account the particular investment objectives, financial situations, or needs of individual clients. Before acting on any advice or recommendation in this material, investors should consider whether it is suitable
for their particular circumstances and, if necessary, seek professional advice. The price and value of the investments referred to in this material and the income from them may go down as well as up, and
investors may realize losses on any investments. Past performance is not a guide for future performance, future returns are not guaranteed and a loss of original capital may occur.
MOSt and its affiliates are a full-service, integrated investment banking, investment management, brokerage and financing group. We and our affiliates have investment banking and other business
relationships with a significant percentage of the companies covered by our Research Department Our research professionals provide important input into our investment banking and other business selection
processes. Investors should assume that MOSt and/or its affiliates are seeking or will seek investment banking or other business from the company or companies that are the subject of this material and that
the research professionals who were involved in preparing this material may participate in the solicitation of such business. The research professionals responsible for the preparation of this document may
interact with trading desk personnel, sales personnel and other parties for the purpose of gathering, applying and interpreting market information. Our research professionals are paid in part based on the
profitability of MOSt which include earnings from investment banking and other business. MOSt generally prohibits its analysts, persons reporting to analysts, and members of their households from
maintaining a financial interest in the securities or derivatives of any companies that the analysts cover. Additionally, MOSt generally prohibits its analysts and persons reporting to analysts from serving as an
officer, director, or advisory board member of any companies that the analysts cover. Our salespeople, traders, and other professionals or affiliates may provide oral or written market commentary or trading
strategies to our clients that reflect opinions that are contrary to the opinions expressed herein, and our proprietary trading and investing businesses may make investment decisions that are inconsistent with
the recommendations expressed herein. In reviewing these materials, you should be aware that any or all o the foregoing, among other things, may give rise to real or potential conflicts of interest . MOSt and
its affiliated company(ies), their directors and employees may; (a) from time to time, have a long or short position in, and buy or sell the securities of the company(ies) mentioned herein or (b) be engaged in
any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or
lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other related information and opinions.
Unauthorized disclosure, use, dissemination or copying (either whole or partial) of this information, is prohibited. The person accessing this information specifically agrees to exempt MOSt or any of its
affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSt or any of its affiliates or employees responsible for any such misuse and further agrees to
hold MOSt or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The
information contained herein is based on publicly available data or other sources believed to be reliable. Any statements contained in this report attributed to a third party represent MOSt’s interpretation of the
data, information and/or opinions provided by that third party either publicly or through a subscription service, and such use and interpretation have not been reviewed by the third party. This Report is not
intended to be a complete statement or summary of the securities, markets or developments referred to in the document. While we would endeavor to update the information herein on reasonable basis, MOSt
and/or its affiliates are under no obligation to update the information. Also there may be regulatory, compliance, or other reasons that may prevent MOSt and/or its affiliates from doing so. MOSt or any of its
affiliates or employees shall not be in any way responsible and liable for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. MOSt or any of
its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of
merchantability, fitness for a particular purpose, and non-infringement. The recipients of this report should rely on their own investigations.
Recipients who are not institutional investors should seek advice of their independent financial advisor prior to taking any investment decision based on this report or for any necessary explanation of its
contents.
MOSt and/or its affiliates and/or employees may have interests/positions, financial or otherwise in the securities mentioned in this report. To enhance transparency, MOSt has incorporated a Disclosure of
Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report.
Disclosure of Interest Statement ITC
Analyst ownership of the stock No
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or
will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report. The research analysts, strategists, or research associates principally responsible
for preparation of MOSt research receive compensation based upon various factors, including quality o f research, investor client feedback, stock picking, competitive f actors and firm revenues.
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 tolaw, regulation or which would subject MOSt & its group companies to registration or licensing requirements within such jurisdictions.
For U.K.This report is intended for distribution only to persons having professional experience in matters relating to investments as described in Article 19 of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (referred to as "investment professionals"). This document must not be acted on or relied on by persons who are not investment professionals. Any investment or investment activity to
which this document relates is only available to investment professionals and will be engaged in only with such persons.
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 beexecuted 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 SingaporeMotilal 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:
Anosh Koppikar Kadambari Balachandran
Email:[email protected] Email : [email protected]
Contact(+65)68189232 Contact: (+65) 68189233 / 65249115Office Address:21 (Suite 31),16 Collyer Quay,Singapore 04931
Motilal Oswal Securities LtdMotilal Oswal Tower, Level 9, Sayani Road, Prabhadevi, Mumbai 400 025
Phone: +91 22 3982 5500 E-mail: [email protected]