‘Sector Update | 9 May 2020 Consumer- Alcoholic Beverages us YEMareh Net Sales Net Sales Gr. (3) eBmoA Margins 66) |g. PAT ‘gj. EPS (NR) EPS Gr. 8) By/Sh (INR) Ratios oe () Roce (8) Valuations P/E w) P/BV EVIEBITOA 6) EvSales LUNSP--Finandals Snapshot (INR) __ YE Maren Sales Sales Gr. (8) EBITDA Margins 60) Pat PSUR EPSGr. (9) BV/Sh.NA) Ratios Ro (i) ROCE (4) Payout (8) Valuations Pre 6 P/BV (8) EV/EBITDA() 669 33 28 2 43 163 “24 14s me m3 se 66 267 35. 535 -200 63 m7 25 96 #12 w2.6 63 60 228 62 367 43 inancals Snapshot (INR) 20206 2023E 20226 663 250 300 ua 46 ws 225 1536 ma 302 soa sa 25 37 922 27 1s 162 83 na 228 522 Er) 178 00 438 96 252 745. “19.2 104 180 5s. 76 “as 598 Pr 1a oo 58 a4 354 a5 27 156 wa 100 Be 308 ns 7 24 0 364 68 2a ‘Lost year(s)’ for alcoholic beverages Downgrade UBBL and UNSP to Sell and Neutral, respectively ‘The COVID-19 pandemic has caused the convergence of unforeseen and unprecedented ‘events in FY21, which i ikely to sharply impact the earnings of alcoholic beverages ‘companies for the year. Even if significant recovery is witnessed off a low base in FY22 (which seems uncertain, as of now) the segment is likely to see negligible profit growth / decline in profits over the next two years. In capital intensive businesses such as Alcobev (relative to FMCG peers), this means ‘most of the good work done in recent years on the return ratio could see a drastic setback. For example, alcobev companies had improved their ROES from levels well below those of consumer peers (and even below their own cost-of-capital levels) in the past. ROEs could now take an even bigger hit than earnings. United Breweries (UBBLY's RoE is likely to bea litle lower than 12% even in FY22, way below 19.2% witnessed in FY19. Although United Spirits (UNSP)in 2 relatively better position than UBBL, its ROE is till ikely to be well below the 20-22% trend seen in the past few years. Earnings growth and ROE improvement have been the key factors responsible for the rerating of these stocks in recent years. However, with the uncertainty surrounding these key components of late, the current valuations seem lofty. We believe the home delivery of alcohol, as is being proposed by several states, is unlikely to create any large positive impact inthe interim given the logistical, socal distancing, and legal challenges that need to be addressed. In our report in March 2019, we had changed our long-standing preference for Ut ‘over UNSP by downgrading the former to Neutral from Buy and upgrading UNSP to Buy from Neutral. On a relative basis, UNSP has outperformed UBBL by 25.4% since the call, ‘hile on an absolute basis, both have declined 10.1% (in line with our coverage universe) and 35.5%, respectively. We have cut our FY21/FY22 earnings estimates sharply by 45%/32% for UBBL (effective cut of 63%/43% including the preview note last month) and 36%/20% for UNSP (effective cut of 51%/31% including the preview note last month). We have further downgraded both stocks, UBBL from Neutral to Sell and UNSP from BUY to Neutral, as a result ofthe ‘Lost years). ‘We have valued UBBL at 18x FY22E EV/EBITDA, with a TP of INR70O, resulting in 3 21% downside on its CMP of INR890. Based on our DCF calculations, we have arrived at a TP (of INRS4S for UNSP, implying a 3% upside on its CMP of INRSO1 (effective target ‘multiple of 37x Mar’22E EPS). Risks to our call emerge from two key factors: (a) there is upside risk if the execution of home delivery is extremely successful and ifthe spread of the epidemic after the eventual repeal of lockdown restrictions is much slower than feared, (b) there is downside risk ifthe extremely steep increase of 70% and 75% witnessed this week in Delhi and Andhra Pradesh, respectively, is replicated by more states or ifthe delay in payments by states gets extended by more than our current assumption of one month, resulting in sharper cuts to our earnings forecasts. Krishnan Sambamoorthy ~ Research analyst (Krishnan Sambamoorthy@MotialOswalcom); #91 22.6129 1545. Research analyst: Dhalrya Dhruv (Dhairya.Ohruw®motaloswal.com); +93 226129 1547 | Pooja Doshi [Pooja.Doshi@ MotilalOswal. com) #91 22 6129 1573 Investors are advised to refer through important disclosures made at the last page of the Research Report. ‘Motilal Oswal researc available on www motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.Morita Oswat Sector Updste | Consumer Caution on discretionary consumption in general, alcobev in particular = While our view on discretionary consumption is extremely cautious over the next, 12-48 months, the alcohol segment, in particular, faces a multitude of challenges, such as the following: > Loss of sales is expected in the first month of FY21 due to lockdown. Even with the re-opening of liquor shops, sales are likely tobe restricted at the national level in the ensuing part of the lockdown despite the surge in the current week, > Overcrowding at wine shops has raised fears of the COVID-19 pandemic ‘worsening. This has thereby caused local authorities to revoke the permissions given to wine shops to operate. Thus, even some of these sales that were intended to be allowed by states are at risk > Sales from the omtrade channel (bars, pubs, and restaurants), accounting for 20% of annual sales, are ata standstill > There isthe likelihood of a surge in excise duties as states strive to bolster their weak finances, severely olted by the COVID-19-led lockdown (news link). This would exacerbate the decline in net sales for alcohol companies leven more than the gross sales decline, This will also further impact thelr margins due to operational de-leverage. > Furthermore, given the perilous situation of state finances, itis certainly possible receivables from state governments could be delayed significantly beyond the 90-200 day trend in recent years. We note that every monthly delay in payments from state governments would impact alcohol ‘companies’ earnings by 10-42%, We are currently assuming 8 one-month delay in receivables in our forecasts. = A combination of these factors has led to an extremely sharp cut in our FY21/FY22, EPS forecasts for bath UBBL and UNSP. > UBL: We have cut our EPS forecasts by 45% and 32% for FY21 and FY22, respectively, Notably, this s over and above the 33% (FY21) and 17% (F¥22) EPS cuts we have included in our UBBL EPS forecasts as part of the Consumer 405720 Preview Note in Apr’20. > UNSP: Simiarty, we have cut our forecasts for UNSP by 36% and 20% for FY22 and FY22, respectively, over and above the 23% (FY22) and 15% (FY22) reduction in our forecasts in the Consumer 4QFY20 Preview Note in Apr'20. Examining in detail factors affecting demand for alcohol products Lockdown — In the first two phases of lockdown, only stores selling essential goods were allowed to remain open. Bars, restaurants, and pubswere closed down. Since the first two phases of lockdown were for alittle over a month in FY21 (April 1—May 3), this automatically meant over a month of loss of sales. Due to seasonality skewed toward the summer, the impact of the absence of all sales in the lockdown period is expected to affect UBBL's FY21 sales by around 10%. UNSP, with a relatively lower summer skew, could witness~73 impact in FY2L, in ‘ay 2020, zMorita Oswat |: 10 contributes higher to UBBL’s annual sales... Sector Updste | Consumer and even higher to EBITDA, v/s UNSP seL = UNSP seL = uNSP om ad a a 3% aK nym 30m ze 2% 2% ae 2K ae KH aay Ez E z E E = Ez z E E Source: MOL, Company Source: MOL, Company 1uor shops re-opening in third phase of lockdown — The majority of the large states (barring Kerala) have allowed the re-opening of liquor shops from 4" May or are likely to begin the sale of liquor sometime this week. We estimate that after the surge witnessed in the first few days, resulting in a higher-than-usual daily average, retail stores sales would be 60-70% lower than usual levels. This is, attributed to the health risks associated with overcrowding in these retail shops. These shops (off-trade) account for ~70-72% of annual alcohol sales, with bars/restaurants and pubs (on-trade) accounting for ~20% and canteen stores (defense forces procurement) “810% = Overcrowding risk to result in re-imposition of ban on alcohol shops for few more weeks —This has already been witnessed in Mumbai, where the municipal corporation revoked permission to re-open liquor shops. Certain other states and districts are likely to follow suit = Om-trade sales may be affected for larger part of year —Even after the lockdown has been lifted, over the next few weeks across states, bars, restaurants, and pubs are believed to be among the last ones to be re-opened. This could, perhaps, lead to total loss of sales for three to four months. Subsequently, once they have re-opened, they would have to apply social distancing measures voluntarily as ‘well as those imposed by local authorities. These could include restricting the number of tables, increasing the kitchen areas, and so on. Thus, sales are not likely to be at par with pre-COVID levels for the majority of the year. We estimate sales from this channel to therefore stand at just half of normal annual levels. Increase in excise ~Total state revenues were down 80% in Apr'20. The damage is expected to be significant going forward, and even after the gradual resumption of economic activity post lockdown. In this scenario, we think there is a high possibility that excise duties would be hiked sharply by various states over the next few weeks as they strive to boost their weak finances. Timeline of excise increases A. Pre-COVID-19 escalation M12" Feb: Goa increased rates by ~30%, with consequent price increases at around 259%. We reckon Goa contributes 3-496 to the sales of UNSP and UBBL. Despite this increase, excise in Goa continues to be among the lowest in India, ‘ay 2020,Morirat Oswal Sector Update | Consumer 1 Gth Mar: Karnataka increased excise by 6% (news link). Subsequently, companies took a similar price increase. We reckon Karnataka contributes 25% to UNSP’s sales and 14% to UBBI’s sales. During the COVID-19 lockdown 1. 30th Apr: Rajasthan announced a 10% excise increase and allowed price rise of 10% (news link), We reckon the state contributes 3-4% to the sales of both UBBL. and UNSP. Ward May: Haryana announced it would consider Increasing excise duty, but it was, yet to decide on the quantum (news link). Ath and Sth May: Andhra Pradesh announced an effective 75% increase in excise over two days (news link). We reckon the state contributes 4% to the sales of UNSP and 6% to the sales of UBBL. The price increase is yet to be determined. ath May: Delhi announced 70% Corona cess on liquor (news link). An effective price increase is yet to be determined. We reckon Delhi contributes around 3% to the nationwide sales of UBBL and UNSP. We believe more states would follow sult in the next few weeks, and importantly, ‘even the states that increased excise before the lockdown (such as Karnataka and Goa) are likely to take anather round of increases. As long as the increase is limited to single digits or the early teens, @ massive Impact on demand is unlikely. However, & sharper increase, such as the ones in Andhra Pradesh or Delhi, could have significant Implications, such as the following: = Demand would be impacted for afew quarters due to a surge in prices. = Down-trading is likely in every segment, barring the super-premium (Scotch whisky) segment. = Asthe economic impact of the lockdown starts to play out, it could result in lower or even nil incomes in various sections of the society. This would further exacerbate demand for alcoholic products as they belong in the discretionary category. Net sales decline would be even sharper than gross sales decline, which would have substantial implications on operating cost absorption, = Unlike the majority of staples companies, alcohol companies have a higher depreciation/EBITDA (even if capex is reduced) as well as interest costs / EBITDA. Therefore, when operating incomes decline, net profit decline is even sharper. = Black-market activities and the number of fake products are likely to increase as consumers may look for means to avoid taxes. While the black marketing of genuine products may dent state revenues, fakes may have serious implications on brand loyalty and even cause health hazards due to the substandard quality of raw materials used, Thus, brands could face market share loss and risk to their reputations on account of fake products. ‘ay 2020,Moritat Oswat ‘Sector Update | Consumer }: Depreciation /EBITDA over the years BEL = UNSP. : Interest/EBITDA over the years am UBBL = UNsP anes sae 348% 229% soa 20.8% 380% 2 26.0% 165% 2368 123% 42% ve = _~ 13 UM ow 225% 50% aasfl) 28% 4 #8 & 8&8 & B 2 8 8 8 2 g zr & EF :& ¢& & zE & gE EF :E & Source: MOFSL, Company Source: MOFSL, Company : Relatively high depreciation /EBITDA among consumer peers (FY20E) F/20E Depreciation EBITDA (i), z 2 : 2 8 3 g telatively high interest/EBITDA among consumer peers (FY20E) Pre mre ot BOA) 33 82 43 at as 34 23°16 41 08 06 os 03 0h 2 ¢ ¢ =: 2 2¢ 8 ¢ ¢:e a ff § £ 2 » 2s g BE 23: 2 = ¢ 4 = 6 2 § £8 = a 8 =e 2 2 2 3 z Source: MOFSL Company = Increase in receivables by state governments and implication on earnings — One of the factors not being considered amid the multitude of other concernsis the increase in net working capital (NWC). NWCis usually “four months for alcohol players, primarily due to high receivable days (90-100 days for both UBBL and UNSP). With the perilous situation of states’ balance sheets, exacerbated by the P&L impact (including revenue declining ~80% in April, as indicated above), we think there is a high probability of states delaying payments. This could have significant implications on interest cost. We estimate that for UBBL, every ‘monthly increase in receivable days would lead to a 10-12% EPS impact on account of higher interest costs. We have taken a one-month increase in receivables for both UBBL and UNSP in our forecasts. ‘ay 2020, 5Moritat Oswat ‘Sector Update | Consumer Exhibit 7: Debtor days ae likely to worsen for both UBBL and UNSP. eed 105 ss 103 nin 7% % 73 8 oo = 2 £ € @ & € € g€ ¢@ 8 creasing tne number fash conversion eye days 2 € &€ @ &€ &€ & € ¢@ 8 tiibt : ool comparieshave th highest debtor dos among consume companies 4 263 28 172 161 we 119 ” gi 22 4 2 5 : 2 a Bos é 4 E & 23 5 5 3 ze 4 3 es Source: MOFSL, Company Exhibit 10: -.and thus also have the longest cash conversion cycles mi 103.0 we Cash Conversion ce days Tea Y2QE Avg Cth Conversion yc ay aa 982 82 337 21 03 me gy 30 i “BS -158 179 -315 Bae @ i sag FEE a ae pei £5 7 € es g 6 £ 3 2 316 2 2 = S 3 g 3 5 2: z 3 eg Source: MOFSL, Company ‘ay 2020,Moritat Oswat ‘Sector Update | Consumer fate for both UBBL and UNSP, but the former would be more impacted Exhibit 11: ROEs would det UBaL = UNSP na ase i228 a7, wo BSS 0 m4 02 67 52 a = = = = = = = Source: MOFSL, Company Why would UBBL get impacted more than UNSP? = Seasonality —In the last 10 years, 10 has contributed 30-40% to the full year’s EBITDA with the consumption of beer skewed toward the summer season in India. Given that lockdown and closure of restaurants/bars/pubs are likely to lead to anear washout in 10, the earningsimpact in FY21 would be more severe for BBL than UNSP, which does not have a significant dependence on the summers. Onthe contrary, UNSP’s demand i slightly more skewed toward the festive season in 30, by which time both on-trade and off-trade channels are expected to be significantly better off than in 10FY21. = CCI penalty —While the courts are not likely to resume anytime soon, we believe a decision on the price fixing issue (news link) is likely sometime this year. The three players involved are likely to be fined USD280m (~INR20-22b), according to news reports. We believe the bulk of this fine may be levied on UBBL which, due to its market leadership would stand to gains more from the alleged price fixing. ‘Accordingly, it may be liable to pay INR13~15b as afine. While this would be ‘written off from the balance sheet, the ensuing interest cost increase (not factored into our forecasts) would impact earnings by another 12-13%. it 12: 10 contributes higher to UBBL's annual sales.. Exhibit 13: ..and even higher to EBITDA, v/s UNSP BBL = UNSP BBL = UNSP am 45% 33% 37% 35% 35% sa 30% 2 2am 8 2% a 208 228 um we 1s = = = = = = = = = = Source: MOFSL, Company Source: MOFSL, Company Delivery is the key monitorable = Amid these negatives, a positive in the sector is the ongoing discussion to allow the home delivery of alcohol. While this s largely non-existent as of now, the ‘ay 2020,Morita Oswat Sector Update | Consumer Government of Chhattisgarh has allowed the same, Punjab has also joined the bandwagon, as per latest media reports (news link). West Bengal Is considering the same, and more states are likely to follow suit. = Nevertheless, we would like to add a word of caution here, The logistics associated with home delivery are complicated, as per an industry expert we recently interacted with, Enrmasse delivery to meet demand is still not practically possible on account of concerns on social distancing, This activity Is, thus, likely to be more an incremental damage control exercise than a revenue augmentation effort. Myriad regulations would also need to be changed to legally allow the home delivery of alcohol. Exhibit 14: We have cut our FY21/FY22 estimates for UBBL by 45%/32% and for UNSP by 36%/20% Tew id change Companies __INRm FE Wa RE WHE Fai a UBL Total Income 33515 66.597 es 73.106 TL = EBITDA 6263 3.351 3.387 BI “3.0% “eae Adjusted PAT 2537 4,630 4,605 6768 49% Le oa Total income’ Tass 31.085, 31537 106,756) =a. =a EBITDA 0,405 155 ase 75,103 “3% “HE Adjusted PAT 5532 9.383 5.585 a3 353% 219.6%, Source: MOFSL, Company Exhibit 15: UBBL P/E chart Exhibit 16: UNSP P/E chart PIE) Avg Mae) P/E) Ave) Max) as00 2800 2562 mas a0 2400 700 00 00 e $$ ¢ $e $ & dF e# £$ @ @ @ € & Ze £i2: f it 2 ¢ 222 ¢ F if ft F Source: MOFSL, Company Source: MOFSL, Company it 17: Consumer P/E chart —P Ie) Ave) —max) —minp) — s10 4150 == - 150 &€ @ F # © 2 F 2 2: & £ i : t F Source: MOFSL, Company ‘ay 2020, 7Morita Oswat United Breweries — Financials Sector Updste | Consumer Consolidated - Income Statement NR Mitton) YEMareh ase SOE ROE ‘Total Income rom Operations 390 aea0s —a7,603 56196 64,754 66,891 53513 66,091 Grange (9) 11 30-17 tad 152 33-200 250 Raw Mteriae agss7 2032778130077 52.332 5543 BAIT % af Sales 403438 4S@ aga 470 Gross Profit 26053 27,198 «25.823 —«29.881 «34.678 34553 27,970 35,478 Margin 3) 537 5625423256823 530 ‘oral Expenditure docsa 414020871 «47,170 ~—«53,371 S088 47,250 56,900 % af Sales 5655 «SSSR 52 Earroa 6326 7,006 —«6732=«9025—=—CsL SBA «BOS 6263 (9.991 Margin 3) BS MS M1 eas a2 63 Depreciation 2075-2436 «28712587 25892895 3.281 3708 carr 42514569 38s 6 429~=«785 == 90R 2.972 6282 lng. and Finance Charges est 787605628305 13 Otherincome woe 1 PRT after £0 Ex 3790 4547 3am «6078 ~—=«793~=«S770 «aaah I Total Tax aie 1S604ts2 232360452 aa 553 Tax Rate (8) m3 M3 OSS 528A 250 Less: Mignrty Interest 4 4 4 4 4 4 4 4 ‘Adjusted PAT 2598 2983229 3m «5629 atd 2587 8.630 ‘Change (9) 10 MB 23072823 "25 ‘Margin (8) 55 62 48. 70 87 6447 63 Consolidated - Balance Sheet NR Mitton) YEMareh Fase SGOT Equity Share Capital 2 —«eR SCS 265 Total Reserves 39587 2120723078 26638 31572 35.285 37.425 40.348 Net Werth aeast 21471 23.02 26.903 —=21888 35,550 97,692 _—40,610 Minority interest 23 25 28 23 30 30 30 30 Deferred Tax Lablties oe eu SSSCtSS ne TotalLoans 94908062 53603221 ~=«2S. SaaS SS SSIS Capital Employed 23000 30,193 23,780 «30235 «34087 39.210 38.351 56,269 Gross Block 3093633084 35089 «37.208 «ass 3s 47.458 S654 Lest: Accum. Dap 3320151047827 01s? as 253008610 ——32.319. Net Fined Assets 3ei16 17,980 17262417056 —417.529tg63a Bead 19,135 Goodwill on Consolidation 222 242 Capital iP 902 -608—«aa72~S~S23 SROs a7 Total Investments 1 1 1 2 3 3 2 2 Curr. Assets, LeansSAdv. 256 tao? 5911 29.212 «S471 «38635 0.6SBS.88e Tnventory 610168817508 «808010325368 835104 ‘Account Raceivablas 9318 i113 2354 esse 151077817303 26.574 (Cash and Bank Balance aos 6203 Loans and Advances 60186618 52055908 az75—gee8 9.323 9573 Cure Liability & Prov. 3176913466 15007 «16.999 19.747 19.885 22.761 «17,477 ‘Account Payables 3798 476 459652175902 527-2870 e759 Provisions 7381929130412 117823614058 13781 erie Net Current Assets 97941361 1090312.212—« 4.28 18.751_ 17,897 «35,417 ‘Appl of Funds 23.000 30,193 23,780 30.235 34,087 39.210 38351_—_—56,269 E: MOPSLEsimates ‘ay 2020,Morita Oswat United Breweries — Financials Sector Updste | Consumer Ratios ‘YEMareh Fase VSO Basie (NR) es 9g 4a~=~«aaSe as Bv/Share m3 1283? 3536 Ps 10 12 12 20 25 1s 10 53 Payout (3) 32 ?SCO2 soto 238 Valuation (x) Pie sos 788 ozs? BSS 508 camn/E 503344553608 SSH 72 Prev ws oa 87 74 66 «62 5a Evie 52 50 5142 37 3543 a7, EV/EBTTOA 3B? 735824 R387 265 Dividend Viel 9) 01 or on 02 03 02 02 06 Return Ratios (4) RoE uss 02S ue Roce woe 21~«ASS eS 02 alc ws 105 e945 es RS ue Werking Capital Ratios ‘Asset Turmover 6 16 is 16 as a3 aaa 12 Inventory (Days) 4 3 55 52 52 7 51 Debtor (O2ys) % 7 33 3 85 0120 20 Creditor (O2y9 2 30 » 2 3 2 30 32 Leverage Ratio (x) Debu/Eauity os 04 03 oa aoa oa Consolidated - Cash Flow Statement (QNR Mion) ‘YEMareh Fase EERE ‘F/ltos9 befare Tax 37804547 34816078 87535770 3,382 e107 Depreciation 20752436 2.71 «258725992898 3.292 3708 lngarest & Finance Charges ne sel 472308243305 133 Direct Taxes Paid 433 “435-2534 3888-4089 638 a a6 (ing/Decin we 3381 425-403-250 3a a6 CF rom Operations asa 5519 5.306 6697675875368 others Bt ee? 2 0 ° 0 CF trom Operating nel EO ‘3.408 Sati 5633 6aa3 6758753 868s {Ing/Decin Fa 4068 “2355-2018 ——-4,366 3980-34803, 980 Free Cash Flow 4339 308s 36192172685 5273 12.668 Others 778 ne 0 o 0 CF from investments 3235 -23a0 2060-4382 3980 -3.090 3,980, Ing(Ded in Debt 4599 “212-2820 -1008 4400 —-3,000 35,000, Interest Paid 715 ‘e507 0S “193 Dividend Paid 303 307-308-558 605-399-727, Others ° ° 1-5 “56 CF from Fin. Activity 3707 302-3638 -1ess 490 3.108 a3,020 Ine/Dee of cash “608 a sti 3485 2.28, 356 Opening Balance ca Me se aot 640 5920 Cash eav 70 mess a7 Clsing Balance 132, 2as 2a at 3701S at_—6.288 E-MOPSLEsimater ‘ay 2020, wMorita Oswat ‘Sector Update | Consumer United Spirits — Financials Income Statement (uN ition) Y/EMareh woe 77 Est ESC SE SE iNet Sales ‘ise W500 64209 s322—90.s3_—~73en8 S048 (Other Operating ne 536 46 432 444300 104002, Total Revenue s2ae2 85,076 17019806 9.243754 .483 Change), 37 36 “aa 33 27-192 227 Gress Profit 3407s 3663239725377 aaess a. Margin (9) a3 423 486 438 455 465 480 Other Expenditure “m2 -26522 25446-30983 -27,068 24,254 28,268 EsIToA ‘Bact ——«9.710—=—«i0279—=S—«a.w7M_— 3.906 10.405, 64a Change) 332 35. 53 252 e302 503 Margin (9) 107 ua ne 43 162 340 wa Depreciation sao 4303 ass aaa ano 2as 408 lng. and Fin, Charges “4455-3680 2675-2200 2870-1683 “2 Other income 307 yim tao 352 Gu 304 65 Profit Before Taxes aa35—=S.a0e=7.353—=—«OAs1 «= tsas 7.396 —13,360 Change), 1013 310 263 338 na 358 206 Margin (3) 54 68 30 n3 ps 33 m6 Ta 238 41g SCaAIS«82RB gS «.367 Tax Rate (8) 532 331 332 336 20 252 52 ‘Adjusted PAT 2076 388d 900 76s 3s 5529, 093 Change), 81 aa 261 381 29-335 206 Margin (9) 25 45 60 75 90 74 109 Non-ree Exp/income “a8 2.86 nm “78 0 o ° Reported PAT 129 16s9 6756S SSSR 9.998 Balance Sheet (WA ition) YEMareh zoe 2017 208 2 aomE aaa Share Capa ass aass—~—iaas3s—~—CiaSS~=C*aSS~~=«ASS~~C* Reserves 35687-47925 ~—=aSeS—«9862—««agAG]99S CS. 9R Net Worth waa) 19378 —-asoae ~~ ISS a ams Baa Loans 3708240407 —~—«a250S == 0DS SSIS «SRS Deffered Tax Uabilties “1539-1242 “56 —-4a78=~=C—2g78 SAB -3.78 Capital Employed 52683 58.5a 56,687 55,262 53,003, $0095 8,088, Gross Black W789 26,081 ——«3561~—~=«waSADS——=«08432—=—ig492_—=—i0,832 ese: Accum. Dep. “6722193540 517298 ©9364-1772 Net Fined Assets 30762 ang72 100214428298 ——to.0cs_— (8.160 Capital iP 2488 252 sso 44713006 0s, 006 lnvestments 9332382775 agee 337378887 Curr. Assets, LEA 67082 -70,763.——74,778——8 30872678 TROTS BL. 213 Tnventory 359918538 1ges¢ ag 767— 38,371 5652 az ‘Account Receivables 2330-29605 26998 ~—~=—«5181~—=«5.018 =O «0,077 (Cash and Bank 3362 5231188 ses 2060 3.226 ca others ps8 -72087 gas 2477225227 28,690 3,255 Curr. ab, and Prov. 277082390 —-28.867 29403 ~—=C«agsG | a6.85 42.078 ‘Account Payables yogis 21798 ~—«3835~—=«3360 «03736 aK 3.33 Other abilities 4466313345 14430 23487065 20.905 23,713 Provisions 3082 «307 ~=~«aAS?SCaT?S«SS SS S70SS(027 Net Current Assets 39379 ass agi ——9825 37.722 35.238 9,38 Application of Funds 52683 58,544 56,687 _—55,262_—*53,063 ($0,095,808, E-MOPSLEmimater ‘ay 2020, HMorita Oswat ‘Sector Update | Consumer United Spirits — Financials Ratios YEMareh oie on sons "aan OE Basie (NR) EPs 29 53 a7 33 na 76 a Camm EPS 43 72 86 13 3 0s wa BV/Share 236 287 345 431 522 538 Re Valuation (x) Pie 753 337 743 538 a8 Co 364 camnF/E 377 Gx 582 443 ua a5 24 EVfiles 12 12 12 10 08 03 07 EV/EBITOA as a3 382 300 252 351 Fre Prev 22 ae 145 us 96 84 ee Return Ratios (4) RoE na 23 136 26 ns 27 7 Roce 67 ne ue 367 va aaa 24 alc 67 na aa 389 383 Ba 2a Working Capital Ratios ‘Asset Turmover 6 is 15 a is v7 as Fr] Leverage Ratio Debt/Equity 6) 22 2a 13 08 os 02 oa Cash Flow Statement (uw ition) Y/EMareh SE A SS 2022 ‘F/as9 betare Tax Sis 2s-aa0s——= eC SCT, T3360 Int JO. Received 1567 “a3 205245 “613 “308 965 Depreciation ané Amor. ao 4323 asa dees ano 2d 2408 nearest Paid 33503488 70877570683 2 Direct Taxes Paid “467-4809 “367 Incr Beer in We “S828 1732 sest 24a 3576 3,650 “6458 CF trom Operations 2266 «67339. S7S— 15,289 a2,a9I 5,819 (lnci/Decrin Fa “21.503 a “6 -1.g61——-1,000 1,500 Free Cash Flow 3232 «576 «9.621382 18.007 «11.996 5.284 (us /Sale of Investments 8.586 m2 23 33 “153 “87 5,000 Other investing tame 20-2973 ae =62-4712 ° ° CF trom invest. 9792 -4a19 1.585 “66-3107 303 5535 leave of Shares o 0 ° 0 0 o 0 Incr/Decrin Debt eC 2,000 Dividend Paid ° 0 o 0 0 0 o Others aaa) 2282s 2s a0 2683 082 CF from Fin. Activity “i033 -5.a53—-40.333——-9.119 10.670 10,183 “2a Iner/ Deer of Cash 352.39 os “10 4arz 4166 “2557 ‘Add: Opening Balance 237 «3362 5234338 ses 2,060, 3.226 Clesng Balance 3.362 3231198 ea 2.060 3.226 eo E-MOPSLEsimater ‘ay 2020, aMorita Oswat Sector Updste | Consumer aan Tare Taster Ring apa tua over moe) ORDER REVEW Tang may mangos age NOT RATED Te nae ead estes ne SC a we FG Fo Sang TREO “wae We ERMNGROTGN GET BY We FETTER RUPEE Wi We Bene ng RGERE HY 9 COUNGUE penne TOG, Be RPEOTEN AV H AT a ‘etoning 8 cyst sppropite mvsues to make te ecamaeneson consent wth De necter ang gene “Te flog Diccwes ae being mate in complance wine SEI Rezerh Aas Regus 2014 ae eee ae Regions). ‘Meta swat Financ Secs Lt. (MOESL) a SEI Regstered Restore Anat hating regen ne. NMOEOOOST2 MOFSL me ReserhEnty (RE) 3s dened ne ‘eguaons i engaged inte snes of png Stuck eg series ntsest visa) Services, Dpesty paca ects Sdn fas Sane pecs. LMOFSL is 2 stay company of Passateiesinert Management Pat LA (MIPL| MOFSL Is 2 sted pubic company, be ces respect ef wich are aaa en wawumtlesualcem UOFSL (este Mel Gaal Sete Lane - OSL) seistered wih the Scabies & Exchange Beat of la (SEB) ans a eghcred Tag ‘Merwin Natenl Sek Exchange f nda Li (USE) an Bemtay Seek Exange Linke BSE) Mal Cenmesy Exange ena Linke (UC ae Rana Cnet ‘8 Deas Exchange Linked (NCDEX) forts sack ting aces & ts Dept parca wh Cerra Depry Series Life (CD) Kael Seceies Depesey ed (WSOLINERL, COURIS on CCRL ands member ef Asecsen of mul Fans of Int (AUP) for esvhwen of Hotcalpreducs ed waece Regus) 8 Dereopment Aen of nga ORDA) as Caprate Agate esarnce pecs Deals of sects ents of Meal saat Franc Series Lined we sae «2 Be ‘tbat tt onerpes nao com Darexeecments et SeeseAccenteomaaies pt 'MOESC ae t asset companys hor rets an esearch AS ong et ees Ma) het, Rave ang tsa pston bat ag paca an ep al the scabs of deans Dare of cempaiesmestene tre.) te [je tn eng pes eee ese @ sh, wena. asia Aas ews Bot Coney may so Femara "ase and Tse Rosse, Prpey Wain AD IMSL assaen an TW RR ce WI Resa Tear asa Ne ARDS ee Me, [MOFSL ane cy na arf an Nae aN meepenent in Wns Sujit Company er WRN Resa TOON ave TaN We, Aegina Detenre (ote aa) Tairaprt et ance ence ton owen ny pera rent esata as coy any ui, ware eh apn, punan, atiy ot ‘eam contain equ ranch wee she MOPS Sf gp compos egsesbn cna ements mle eh ser Forton tong “Ts rept seb in Hong Keng by Motil Ost apa Mares Pang Keng) ate Lint eens caporsion (CE AVY censed an equate bye HongKong Fares Ordnance (Chapt 11 of te Lams of Hong Kon) “SFO" A per SEB1 Research Ans 5) ean agement wy Met! Orwa copa et (Weng Kan) Pre Linke fr ether ot 59 ‘Pressinl etre efineé nar of ene 10 SFO. ay evecient or neste cy essa ives ne il be engage en wh potessional vst” Neting Rete 28 oto sini of est uct od sees ny jctn where eo ole ot aslo exept tom Fesiraten, Te lnan Axe) whe comple eer eat Keng te et conacing Reset NAS Hang Keng sects, [osm Fl See nit (UDF args nde te US See Ste ee 3 ened te Wiad ps he id dup ele te shoe es See Hah anne ex Hs et od beta eB ehh ker lpr se bin ried Sot frp es pce pont ey gest mented UOT hang 8 prs nae TeekeSecn we nto bette 8 US peeps stated dan oy lb a reo ted ye esha oe sg deed Spaeth iets etd cents dS dy pase ogre ohn ‘etic ska 80 cmt sy ae 8 nape had mses ae egg sy gr tenia cic ob emp om egos ‘Tebcttoen ah bitin! besbobond Us, Fats sobed et png serene US ged lerdal One Sos renal nk Fusion panne bc eebe eos cen esto ‘se seach hap antag ery ite egbie imate tse pth FER So toh may he ch ea fe US ged beret, iin fv, cyte nal arid WEE Ra Eom como spa pcan oa cad Borsessmmm ‘Saga opin by hal rm Cpl se Sore (ADEA) aa. 1 20198 a ase ed sir Spb toe apes stint eggs 3S end Rees RUCHED od Regge leiden Mae ean eS BE tS oa” Ru epg Sw HIER eet ey nny on me oh intimin Tn npn tee i Spr ng io ire, ah ne fey cae wena tts rbd ‘eater Tens ay cape elena ne B02 enon Seay pose Hote seas sch tates ea Sapp es ask Santa ton yooh pend on MBSE SpecheOndonores es ot pots imran suecompary a ony co nttave guy oeg inte cunpceompa eae roti tan ec oentiper crn cures ne ecco esa fot nies conpretanlste eet fom apeeconpen nite ard ae NOB fernen avaptaraor he wats so nxt resco of rrintesungetconzey ste ne poset eR RPO feseacnsmst ms nzsene reece emgeyae inte snectconzay Nowe faced re merape crmarnget ct panic emivg seta ce set company inart2 moe OBL rot eect comperntonorinertnett nig) rere wrglowienge ev om he oercomanynve wit none {2 hotties sot mts compreton te’ Sun meantime nny seme a te teseapetcompry ate pas 2 mon 5. Mestre st artes any comeraton sie ervey ncoeionsiance earn oe fe. "Wor tra ocegeges nsanesranrgectin ertecunpeomeny ‘ay 2020, aMoritat Oswat ‘Sector Update | Consumer “Te aesoces of MOFSL. may nove ronal eesti eye compy scnalbenefi emery of ce more seus ne sect company recited compesstnmer bene ame set company be et 12 mans ner ptr cect meet wn espects 3y recommen ae set ees informa 0 ering nasoere on he ‘Spces recommendations mate te sens 2 te recommendations mace 3 Beats) completa ncepencet oe ews ee assests eFMOFSL ees ‘eign ee mites an meres cot mare some efte tkemetoned he esac eae teas a manage of esnager of pub ofeing of secs te sujet company in past 12 mers be engage many ster tansacieninvuig ich sects ane ear rltage or ee Compenstien of 225 3 monet motrin he ancl inserts of Be Cnmpanytes)tscesed ten oats a ator or enetbaonsschcompy ie) ‘eceedompenston rm eset company ne pst 2 anh fr nvecoen sl /mechaot bling oterge cei tte ober ald ees. “Te associates of MOFSL. as ntrctived ay compen ter Deeds tam it ay conection wie serch repo. tissues cde Beet Rong ng ema account of MOFSL ch te pene fr propia vestne n e cls pene ning, rd name of MOPS a ober poses olin ert secures, cba, ent wades ete) MOFSL see ete OP ‘anes wih ae ntconsteredn seve dca batt ostieon “The news eres i i ese aa) 5 5, ‘orm 8 conaton: “Tis eper az ben peated by MOFSL ane mean ale ce byte ee an et cca. The rp an atamatn conn heey cone ne my ‘eb aera in any wy, tse, copie eerie npr er nal, to ny eer person ott te medio ceprotace i any em, wou pie wien conse of LMOFSL Te veges based on Bec, gues ne nro at Cnc tut, covey rhe ae acca Theat of sepa net een wae “Tne tormaton ie ebtaned om pie aslo medina eer cores belted be tll. Suh bfrmaton Bae aot been eepedeney Webied 306 SU, rupesentaton of warany, expresso mpg, mate 2 fe acc), eamplteaes or comees. Meh oma a opinion te iets change mio et THE ‘epee pepte sft borate pupese andes et ansate ah ot abstr seater ot ober fone ne tne MOFSL wi nett tecpat 3 cure reece personal views oe ans) aout eset secs or ses, and ne prof campensan of ing risa spec ecommenesn 4 vies eprsee oy esenen eae) pe ‘nguumens re cen. Tough dsseninatea tal be casters SmTaneUS, ‘casomers yw ef erecting Depo. oman conaies neve cy conte ae meat oy De cece epi bd map netbe atte nay wy, tonemite copie ot debe eter psen tte med ot reproduce in anf, vet wien conse. Tas reper ane inmaenberein se) fe nati purpse htop netbe wee oCnsicered a5 eet ecument soleaton of er i see suse scabs eer ancl mses. Neds pe conse neses ea acauning axa epresentaon Dat ny bvestest tate) subbe o ppotate fo ou Spec ciamstances, The secs cussed ant pins epee sept may nt be suabe a invest, une must make Deo nese econ, bases eee om eve snen ejects, anal pests Shi neds specie rcpt Toe may note faken in sbi te erie of dependet eget yan ee Ech rcpt oe deamet nu make cd ‘necigatens ae tees ones ane stan ndependet ean ofan inecen ne secu: of campates eed eta coment (newdg te mee ae ke [nro esti cana oun nor eee te met 00 Tso ach an resent The har aoen Geuesee a ews epesso4 may ht esate fa ‘eres, Crt anacins sing se arehg anes, cpm, aber eae proucts swel as nonnesten sae seus mle sub isk aa ae net ‘sate ra vse We repesevaon et waa, exes er pl me a Se Acura) compeeess aes ofthe ermten an eps cemaine in is came The Osc ore Semen eared nis coments eet eat De ope ane ha ete RE 3 resees Be gas make meade Se tema he employees may tem me te, eet cument They may pee of seek peer ven ‘ep shu take ste scot ete berpretng he eacament This regan bs een prepared one Bas of eresontiisaeaty ara publ acess medio evlped Brough aso MOFSL The views expressed ae ese ee aly and he Company may fn aatsvncibe tate views egeset ere, Ts ely of recy, any epson epi, cape, ‘to erin pa ey pres. Ti repr tect er tener abn ey, an) prsen r enywno is3 eno resent ested an) ely, te, ‘rue eet rsacen waee sch cen, pbicsten,waaby ewe meaDe Cota w, egulabon of wh weal sujet MOFSL ay ressten ening ‘eqaromen wun sch sn. To secrtesGescbee barn may wa et eign ersle In 3 seins ot cain ategery of mesos. Persons wnest etn i cera ce ete hr Rennes of et see Hen, ete Fm et recy pet en epee iyaabiy ag tom yo ites ot ays -Ts4ne; waste ‘wor nati com CN ne: LeUMRZEEPL CESS. Cmespenoene Once Ares: Pam ping Cee, 26 Foe, lm Cou Comply, New nk eae abe, ‘Mumba o0 Ten: 02 728 100 Regavon Net: Medi Osmo! Fnac! Sauces Uke QOFSL)" RZHEEHISSBSENSECXNCDEX COSL ané NSOL: NOPLIE2I5, Reseaen Arast ‘noneone. AU: ARN 6647; ante Aaa: MADOERTIN erence Corea Agent CA0574:PMSINPOEEGGTI2. Metal Oswa cst Management Company {i QuOAMCy Pus fegseaten Ne: NPooanOTO] Pus se ebrereeghMOAMC wien sup compat f HSL. Mei Os wal Vesth Manageme {(UOMML PU feston No INPOBEOOAES eed ugh MOM, wie rap company of MOPSL- Motil Orl anal Sees Lees bro ¢ NCOsjsuace Pru ane POs Rest sate is eeé ugh Met Osan eat esate nesmest ates Pa Lit ich 2 ic sep company oFMOFSL.Researeh & Aas) pep eseacn ase eae ik Discs Document rescbed byte Stack Exchanges cae Betre mesh Thee se asuancew gue fe reams. vcore in secaes market sujet» mae fea ae ree oct care bere ntsing Deals of Camplance Ofer Mane: Nee gran Email: nagotsewscom, contact. 22 181085, "TVOSt a35 been amaamsee win Mtl Osual Facil SenicesLinteé (MOFSL) wes August 21, ‘Company Law Trbanl Mumbs Benen pursue eter ated uy 30,2018 sed by Ho ‘ay 2020, w