Result Update

January 25, 2019

Rating matrix
Rating : Buy Pidilite Industries (PIDIND) | 1126
Target : | 1250
Target Period
Potential Upside
:
:
12 months
11%
High raw material prices hit margin …
 Pidilite Industries recorded strong consolidated revenue growth of
What’s changed?
~20% led by standalone revenue growth of 16% YoY (with volume
Target Changed from | 1096 to |1250
growth of ~11% YoY) and strong performance of domestic
EPS FY19E Changed from | 19.6 to | 18.5
EPS FY20E Changed from | 24.3 to | 22.0
subsidiary (revenue up by 48% YoY). Standalone consumer & bazaar
EPS FY21E Introduced at | 26.1 (C&B) segment volume growth was up ~13% while industrial
Rating Unchanged product volume recorded a marginal decline of ~2% YoY. On a
consolidated basis, domestic subsidiaries recorded a strong
Quarterly performance performance whereas revenue from international subsidiaries
Q3FY19 Q3FY18 YoY (%) Q2FY19 QoQ (%) remained muted on a YoY basis
Revenue 1,848.3 1,542.9 19.8 1,757.4 5.2  A steep increase in VAM prices along with rupee depreciation
EBITDA 336.8 370.3 -9.0 364.8 -7.7 resulted in a 620 bps contraction in gross margin. However, saving in
EBITDA (%) 18.2 24.0 -578bps 20.8 -254bps other expenses (down 40 bps YoY) was not enough to save EBITDA
PAT 219.6 239.1 -8.2 231.2 -5.0
margin from a sharp decline of 580 bps YoY to 18%. This has finally
Key financials resulted in lower PAT during Q3FY19. According to the management
there is some respite in VAM prices as it is hovering around
| Crore FY18 FY19E FY20E FY21E
US$1000/tonne against US$1300/tonne recorded in Q3FY19. This
Net Sales 6,078 7,142 8,204 9,470
EBITDA 1,341.2 1,453.1 1,717.9 2,030.5
coupled with average price hike ~2% during Q3FY19 would help the
Net Profit 966.1 948.7 1,129.1 1,336.6 company to bring back the EBITDA margin to 21-22%
EPS (|) 18.8 18.5 22.0 26.1 Strong play in adhesive and sealant segment
Valuation summary
Pidilite is a dominant play in India’s adhesive market with a market share
FY18 FY19E FY20E FY21E
of ~70% in its leading brand categories (Fevicol) in the organised
P/E 59.7 60.8 51.1 43.2 segment. The company’s two major segments, C&B (product includes:
Target P/E 66.3 67.6 56.8 48.0 Fevicol & M-seal) and speciality industrial chemical recorded sales CAGR
EV / EBITDA 42.2 38.6 32.5 27.4 of ~14%, ~8% (standalone), respectively, in FY11-18. The C&B segment
P/BV 16.2 13.2 11.7 10.1 growth came on the back of demand from the construction, repair &
RoNW (%) 27.0 21.7 22.8 23.3 maintenance activities. We believe the segment (standalone) is likely to
RoCE (%) 33.6 29.6 31.4 32.4 record 16% CAGR in FY18-21E on the back of rising penetration in smaller
towns (population below 50,000), pick-up in construction activity in India.
Stock data
We also believe recent acquisition in water proofing and flooring
Particular Amount
businesses have started gaining traction with strong revenue growth
Market Capitalization (| Crore) 57,723.3
Total Debt (FY18) (| Crore) 122.6
(Nina waterproofing: 43% revenue growth, ICA Pidilite: 59% growth in
Cash and Investments (FY18) (| Crore) 163.6 9MFY19), thereby contributing to consolidated revenues. This would give
EV (| Crore) 56,567.3 additional fillip to the revenue growth, going forward.
52 week H/L 1209 / 800 Industrial product category remains slow performer
Equity capital (| Crore) 50.8
Though consolidated sales CAGR of ~16% in FY18-21E would largely be
Face value (|) 1.0
led by the C&B segment, we believe the industrial segment (contributes
Price performance ~16% to topline) and its overseas subsidiaries performance will be aided
1M 3M 6M 12M by rising government expenditure in various social & infrastructure
Pidilite Industries 1.2 16.5 7.8 26.3 schemes, going ahead. We model segment sales CAGR of ~12% in FY18-
Asian Paints 1.2 14.2 (4.3) 16.6 21E led by a demand recovery in various industries (e.g. textiles, leather,
Kansai Nerolac (7.0) 15.2 (8.5) (11.8) footwear, ink, packaging, etc).
VAM prices in declining territory; maintain BUY
We introduce FY21E estimates with revenue earning CAGR of 16% and
11%, respectively, in FY18-21E. With VAM prices falling to below
US$1000/tonne from the peak of US$1600/tonne, we would not foresee
Research Analyst margin decline below 20%. We maintain our positive stance on growth
Sanjay Manyal prospects considering it is market leader in many of consumer adhesive
sanjay.manyal@icicisecurities.com categories and command pricing power. We believe declining trend of
VAM & stable rupee would help in recouping the operating margins to
Hitesh Taunk ~21% (100 bps increase) in FY21E. This along with strong balance sheet,
hitesh.taunk@icicisecurities.com healthy return ratios & efficient deployment of cash for inorganic
expansion gives us comfort despite relatively rich valuation multiples. We
roll over our valuation on FY21E with revised target price of | 1250 /share.

ICICI Securities Ltd | Retail Equity Research

Variance analysis
Q3FY19 Q3FY19E Q3FY18 YoY (%) Q2FY19 QoQ (%) Comments
Revenue 1848.3 1747.4 1542.9 19.8 1757.4 5.2 Strong growth in sales was mainly driven by C&B segment
Other Income 30.7 21.4 19.5 57.7 27.6 11.0
Raw material prices increased substaintially mainly due to high VAM prices
Raw Material Exp 860.4 751.4 655.7 31.2 790.0 8.9 & simultanoeus rupee depreciation during the quarter resulting in gross
margins contraction by 620 bps YoY
Employee Exp 208.7 206.2 174.3 19.7 203.7 2.5
Admin & Other exp 327.6 316.8 279.7 17.1 299.7 9.3
Purchase of Traded goods 114.8 98.6 62.9 82.4 99.1 15.8
Total Expenditure 1511.6 1372.9 1172.7 28.9 1392.6 8.5

EBITDA 336.8 374.5 370.3 -9.0 364.8 -7.7

EBITDA Margin (%) 18.2 21.4 24.0 -578 bps 20.8 -254 bps Contraction in EBITDA margin was mainly due to lower gross margin
Depreciation 32.1 31.8 29.2 9.7 31.6 1.6
Interest 6.2 7.5 4.1 51.1 6.0 3.2
Exceptional items
PBT 329.1 356.6 356.4 -7.6 354.9 -7.3
Total Tax 111.0 119.4 119.3 -6.9 123.0 -9.8
PAT 219.6 239.3 239.1 -8.2 231.2 -5.0 Sharp decline in operating profit resulting lower PAT during Q3FY19
Key Metrics
On a standalone basis, C&B segment recorded a sales growth of ~17% YoY

Consumer & Bazaar 1,597.4 1,509.4 1,308.6 22.1 1,514.6 5.5 led by ~13% YoY growth in sales volume & mix. Further, strong

performance of domestic subsidiary led overall growth in C&B segment

Industrial Revenue growth in the industrial segment led by price hike however sales
261.8 256.7 247.0 6.0 253.9 3.1
volume & mix recorded a marginal decline of 2.3% YoY
Others 18.3 13.4 13.4 36.1 17.4 5.1
Source: Company, ICICI Direct Research,

Change in estimates
FY19E FY20E Introduced Comments
(| Crore)
Old New % Chg Old New % Chg FY21E
We have marginally tweaked our revenue estimates for FY19E & FY20E and
Revenue 7,406.9 7,141.6 (3.6) 8,241.0 8,204.5 (0.4) 9,470.0 introduced FY21E estimates. We model revenue CAGR of 15% led by revenue CAGR of
16% in the C&B segment
EBITDA 1,525.6 1453.1 (4.7) 1,836.0 1717.9 (6.4) 2,030.5
We believe respite in raw material prices coupled with price hike at regular interval
EBITDA Margin (%) 20.60 20.3 -25bps 22.3 20.9 -136bps 21.4
would help in maintaining EIBTDA margin at higher level
PAT 1004.3 948.7 (5.5) 1248.1 1129.1 (9.5) 1,336.6
EPS (|) 19.6 18.5 (5.5) 24.4 22.0 (9.5) 26.1
Source: Company, ICICI Direct. Research

Assumptions
Current Introduced Earlier Comments
FY18 FY19E FY20E FY21E FY19E FY20E
We have introduced FY21E estimates with topline CAGR of 16% in FY18-21E led by
Consumer & Bazaar (%) 2.8 16.1 15.5 15.6 20.2 13.4
domestic performance
Industrial Growth (%) 3.3 8.5 10.4 16.7 12.2 8.4
Others Growth (%) 13.8 -0.5 5.4 16.7 2.8 3.4
Source: Company, ICICI Direct. Research

ICICI Securities Ltd | Retail Equity Research Page 2

 Exhibit 1: Revenue growth led by C&B segment

10000
9000

9470.0
8000

8204.5
7000

7141.6
6000

(| crore)

6078.4
5701.6
5000

5616.8
4820.4
4000

4260.6
3657.9
3000

3109.7
2000
1000
0
FY12 FY13 FY14 FY15 FY16 FY17* FY18 FY19E FY20E FY21E

Source: Company, ICICI Direct Research, * due to change in reporting structure, sales of subsidiary

Exhibit 2: Strong performance of standalone business to help drive Exhibit 3: Revival in industrial activity to lead to increase in industrial
revenue growth of C&B segment going forward segment revenue

8000 1600
CAGR ~12%
7000 1400
7294

1390.6
6000 1200 CAGR 9%
6253

1192.0
5000 1000

1079.3
5365
(| crore)

(| crore)

994.8
963.6
4000 800
4546
4369

872.1
869.2
3890

3000 600
3577

713.2
708.2
635.5
3109

2000 400
2674
2227

1000 200
0 0
FY12

FY13

FY14

FY15

FY16

FY17

FY18

FY12

FY13

FY14

FY15

FY16

FY17

FY18
FY19E

FY20E

FY21E

FY19E

FY20E

FY21E
f
Source: Company, ICICI Direct. Research Source: Company, ICICI Direct Research

Exhibit 4: To pass on higher raw material prices by taking price hike

2500 25

2000 20
2,030.5

1500 15
1,717.9
(| crore)

1,453.1

(%)
1,341.2
1,259.8

1000 10
1,173.5
776.6

500 5
671.5
483.7

600.5

0 0
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E FY21E

EBITDA EBITDA Margin (%)

Source: Company, ICICI Direct Research

ICICI Securities Ltd | Retail Equity Research Page 3

 Exhibit 5: Net sales growth to drive PAT growth

1600
1400 CAGR ~11%

1,336.6
1200
1000

1,129.1
CAGR ~22%

(| crore)

966.1

948.7
800

863.2
807.2
600
400

512.6
454.6
423.8
200

324.3
0
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E FY21E

Source: Company, ICICI Direct Research

Exhibit 6: Strong return ratio on the back of debt free status, strong cash flow from operations

45 40.4
40 33.6
33.0 31.4 32.4
35 29.4 29.6
30
25 30.6
27.0
(%)

20 24.9
22.9 21.7 22.8 23.3
15
10
5
0
FY15 FY16 FY17 FY18 FY19E FY20E FY21E

RoCE ROE

Source: Company, ICICI Direct Research

ICICI Securities Ltd | Retail Equity Research Page 4

 Key takeaways of conference call
 Significant drop in gross margin was led by adverse currency
movement in addition with higher raw material prices. However, the
current spot prices of major raw material (VAM) prices hovering
around US$ 1000 /t as against US$ 1300/t recorded during Q3FY19
Raw material prices have started moderating from Q3FY19 onwards

 Company has clocked double digit volume growth in consecutive

last six quarter. During Q3FY19 standalone sales volume & mix
growth was ~11% YoY led by 13.4% YoY growth in sales volume &
mix volume of consumer & bazaar products. However industrial
products - sales volume & mix declined by 2.3% YoY. There is
possibility of upstocking by dealers prior to price hike taken by the
company

 According to management price hike during the period coupled with

lowering input cost would help in improving gross margin in the
coming period. Company has taken price hike of 3.5% in Q2FY19
and 1.5-2% during Q3FY19.

 Domestic subsidiary recorded a strong revenue growth of ~48%

YoY (like for like) during Q3FY19. Nina and Percept, engaged in
waterproofing services has reported good sales growth of 33.5% and
49% YoY to | 62.2 crore and 18.7 crore respectively. On the EBITDA
front, percept reported EBITDA growth of 22% YoY to | 1.2 crore,
however Nina recorded a sharp decline in EBITDA by 56% YoY
mainly due to provision of | 4.4 crore made against fixed deposits (of
| 8.8 crore) placed with IL&FS group. Excluding this provision,
EBITDA growth of Nina for the quarter stands at 9.3% YoY.

 On the international front, sales growth were muted at 1% YoY led

by decline in sales of subsidiaries in USA and Brazil by ~19% and
~5% YoY respectively. Sargent Art, a division of Pidilite USA,
reported decline in sales and EBITDA for the quarter and YTD mainly
due to reduction in demand of products for adult colouring segment.
Pulvitec do Brasil sales for the quarter declined due to competitive
pressure in key products

 International business EBITDA margin declined by 320 bps YoY to

2.2% impacted by adverse currency movement and higher raw
material prices

ICICI Securities Ltd | Retail Equity Research Page 5

Recommendation history vs. consensus
1,300 70.0
1,200
1,100 60.0
1,000
900 50.0
800
(|)

40.0
700

(%)
600
30.0
500
400 20.0
300
200 10.0
100 Jun-16 Aug-16 Nov-16 Jan-17 Mar-17 Jun-17 Aug-17 Nov-17 Jan-18 Apr-18 Jun-18 Aug-18 Nov-18 Jan-19
0 0.0

Price Idirect target Consensus Target Mean % Consensus with Buy

Source: Reuters Company, ICICI Direct Research

Key events
Date Event
Apr-09 Repurchase of FCCBs of US$40 million issued in December, 2007
Jan-10 Announcement of bonus issue 1:1
Feb-11 Company records strong earnings growth of 25% YoY in Q3FY11
May-12 Strong Q4FY12 performance, standalone net profit increased 143% YoY led by saving in interest cost
Jul-12 Forms JV agreement with hybrid coatings for manufacture of construction chemicals and to establish a JV company in India for this purpose
Dec-12 Redeems outstanding FCCB of US$28.57 million with the premium of 39.4%
Jan-13 Strong Q3FY13 performance wherein overseas subsidiaries saw a sharp 15% YoY growth in terms of constant currency and saving in interest cost
Aug-13 Acquisition of adhesive business of Suparshva Adhesives
Oct-13 Company records overall volume growth of ~17% YoY in Q2FY14 led by sharp volume rise in industrial segments by ~22% YoY
Dec-13 Redeems outstanding 600 NCDs aggregating to | 60 crore on maturity date
Sep-14 Acquisition of adhesive business of Bluecoat Pvt Ltd
Mar-15 Acquires 70% stake Nina Water proofing System Pvt Ltd
Jun-16 Acquired 100% of Nebula East Africa Private Ltd (NEAPL) through subsidiaries
Apr-16 Forms a JV, ICA Pidilite Pvt. Ltd with Italy-based wood finish manufacturer Industria Chimica Adriatica Spa (ICA) for distribution of IC's products.
Jan-18 Acquires 70% stake in CIPY Poly Urethanes Pvt. Ltd. (CIPY) which is engaged into floor coatings
Mar-18 Collaborated with Jowat SE for distribution of Jowat's products in India, Sri Lanka, Bangladesh and Nepal and technical collaboration for Hot Melt Adhesives.
Source: Company, ICICI Direct Research

Top 10 Shareholders Shareholding Pattern

Rank Name Last filing date %O/S Position (m) Change (m) (in %) Dec-17 Mar-18 Jun-18 Sep-18 Dec-18
1 Parekh (Narendrakumar Kalyanji) 31-Dec-18 10.7 54.3 0.0 Promoter 69.6 69.8 69.8 69.7 69.8
2 Parekh (Madhukar Balvantray) 31-Dec-18 10.4 52.8 0.0 FII 11.0 10.4 11.8 11.9 11.4
3 Parekh (Ajay Balvantray) 31-Dec-18 9.3 47.4 0.0 DII 8.4 9.2 8.0 8.0 7.8
4 Parekh (Sushil Kumar Kalyanji) 31-Dec-18 8.2 41.8 0.0 Others 11.1 10.7 10.4 10.4 11.0
5 Devkalyan Sales Pvt. Ltd. 31-Dec-18 5.2 26.2 0.0
6 Ishijas Chemical Pvt. Ltd. 31-Dec-18 4.9 24.9 0.0
7 Life Insurance Corporation of India 31-Dec-18 3.2 16.4 -0.4
8 Axis Asset Management Company Limited 31-Dec-18 2.8 14.3 1.8
9 Harton Pvt. Ltd. 31-Dec-18 2.4 12.4 0.0
10 Vaccum Forming Company Pvt. Ltd. 31-Dec-18 2.3 11.5 0.0
Source: Reuters, ICICI Direct Research

Recent Activity
Buys Sells
Investor name Value(m) Shares(m) Investor name Value(m) Shares(m)
Axis Asset Management Company Limited 28.4 1.8 LIC Mutual Fund Asset Management Company Ltd. -296.8 -18.6
Reliance Nippon Life Asset Management Limited 3.1 0.2 Matthews International Capital Management, L.L.C. -11.8 -0.8
Sjunde AP-fonden 2.9 0.2 Life Insurance Corporation of India -6.8 -0.4
Aditya Birla Sun Life AMC Limited 2.7 0.2 APG Asset Management -5.0 -0.3
William Blair Investment Management, LLC 2.2 0.1 Manning & Napier Advisors, LLC -2.0 -0.1
Source: Reuters, ICICI Direct. Research

ICICI Securities Ltd | Retail Equity Research Page 6

Financial summary
Profit and loss statement | Crore Cash flow statement | Crore
(Year-end March) FY18 FY19E FY20E FY21E (Year-end March) FY18 FY19E FY20E FY21E
Total Operating Income 6078.4 7141.6 8204.5 9470.0 Profit after Tax 966.1 948.7 1129.1 1336.6
Growth (%) 17.5 14.9 15.4 Depreciation 119.9 128.5 155.9 185.6
CF bef working cap chan 1102 1106 1307 1540
Raw Material Expenses 2887.7 3505.7 4035.6 4676.3 Net Inc in Current Assets -386.0 -323.2 -372.7 -446.4
Employee Expenses 712.4 828.5 934.8 1019.4 Net Inc in Current Liab. 168.4 183.8 195.7 176.2
Marketing Expenses 229.3 302.7 353.3 405.1 Net CF from Op activities 883.9 966.1 1129.8 1269.9
Other Expenses 907.8 1051.6 1162.9 1338.7
Total Operating Expenditure 4737.2 5688.5 6486.6 7439.4
EBITDA 1,341.2 1,453.1 1,717.9 2,030.5 (Purchase)/Sale of FA -223.2 -250.0 -250.0 -280.0
Growth (%) 8.3 18.2 18.2 Increase/decrease in other investment -77.7 -50.0 -50.0 -50.0
Others 334.2 -198.0 -198.0 -308.0
Other Income 148.4 112.1 136.8 158.8
Net CF from Inv Activities 33.2 -498.0 -498.0 -638.0
Interest 15.5 28.2 21.9 17.9
Inc / (Dec) in Equity Capital -0.5 0.0 0.0 0.0
PBDT 1474.1 1537.0 1832.8 2171.4
Inc / (Dec) in Loan Funds 25.0 -30.0 -20.0 -10.0
Depreciation 119.9 128.5 155.9 185.6
Total Outflow of dividend -370.2 -555.3 -555.3 -555.3
Total Tax 392.7 464.8 553.4 655.3
Others -508 385 -22 -18
Profit from Associates 4.6 5.0 5.6 6.1
Net CF from Fin. Activities -853.4 -200.5 -597.2 -583.2
PAT 966.1 948.7 1,129.1 1336.6
Growth (%) -1.8 19.0 18.4
Net Cash flow 63.7 267.6 34.6 48.7
EPS (|) 18.8 18.5 22.0 26.1
Cash and Cash Equi beg. 99.9 163.6 431.2 465.8
Source: Company, ICICI Direct Research Cash 163.6 431.2 465.8 514.4
Source: Company, ICICI Direct Research

Balance sheet | Crore Key ratios

(Year-end March) FY18 FY19E FY20E FY21E (Year-end March) FY18 FY19E FY20E FY21E
Equity Capital 50.8 50.8 50.8 50.8 Per Share Data
Reserve and Surplus 3523.3 4329.7 4903.5 5684.8 EPS 18.8 18.5 22.0 26.1
Total Shareholders funds 3574.1 4380.5 4954.3 5735.6 Cash EPS 21.2 21.0 25.1 29.7
Total Debt 122.6 92.6 72.6 62.6 BV 69.7 85.4 96.6 111.9
Deferred Tax Liability 110.7 110.7 110.7 110.7 DPS 7.2 10.8 10.8 10.8
Minority Interest 175.0 177.0 179.0 181.0 Operating Ratios
EBITDA Margin 22.1 20.3 20.9 21.4
Total Liabilities 4073.5 4851.9 5407.8 6181.1 PAT Margin 15.9 13.3 13.8 14.1
Return Ratios
Assets RoE 27.0 21.7 22.8 23.3
Total Gross Block 2333.1 2663.1 2913.1 3193.1 RoCE 33.6 29.6 31.4 32.4
Less acc depreciation 1168.3 1296.8 1452.7 1638.3 RoIC 44.7 41.2 43.0 44.4
Net Block 1164.8 1366.2 1460.4 1554.7 Valuation Ratios
Total Fixed Assets 1392.5 1514.0 1608.1 1702.5 EV / EBITDA 42.2 38.6 32.5 27.4
Other Investments 131.0 181.0 231.0 281.0 P/E 59.7 60.8 51.1 43.2
Goodwill on consolidation 177.4 177.42 177.42 177.42 EV / Net Sales 9.3 7.9 6.8 5.9
Market Cap / Sales 9.5 8.1 7.0 6.1
Inventory 804.3 939.2 1078.9 1271.3 Price to Book Value 16.2 13.2 11.7 10.1
Debtors 938.1 1076.1 1258.8 1452.9 Turnover Ratios
Loans and Advances 11.9 13.9 16.0 18.5 Asset turnover 1.5 1.5 1.5 1.5
Other Current Assets 276.0 324.2 372.5 430.0 Debtor Days 56.3 55.0 56.0 56.0
Cash 163.6 431.2 465.8 514.4 Creditor Days 32.7 32.0 32.0 30.0
Total Current Assets 2193.8 2784.6 3192.0 3687.1 Solvency Ratios
Debt / Equity 0.0 0.0 0.0 0.0
Total Current Liabilities 1131.0 1314.8 1510.4 1686.6 Current Ratio 3.4 3.4 3.5 3.7
Net Current Assets 1062.9 1469.9 1681.6 2000.5 Quick Ratio 2.1 2.1 2.1 2.2
Total Assets 4073.5 4851.9 5407.7 6181.0 Source: Company, ICICI Direct Research
Source: Company, ICICI Direct Research

ICICI Securities Ltd | Retail Equity Research Page 7

ICICI Direct coverage universe (Consumer Discretionary)
Sector / Company CMP M Cap EPS (|) P/E (x) EV/EBITDA (x) RoCE (%) RoE (%)
(|) TP(|) Rating (| Cr) FY18E FY19E FY20E FY18E FY19E FY20E FY18E FY19E FY20E FY18E FY19E FY20E FY18E FY19E FY20E
Asian Paints (ASIPAI) 1,372 1,600 Buy 131,575 21.9 24.3 28.7 62.7 56.4 55.8 41.6 35.4 30.1 31.6 32.6 34.1 24.4 24.8 25.5
Astral Polytecnik (ASTPOL) 1,034 1,125 Hold 12,382 14.7 17.7 26.4 70.5 58.3 39.2 40.8 30.9 23.1 22.9 23.4 26.3 17.2 16.4 19.8
Bajaj Electricals (BAJELE) 453 545 Hold 4,623 8.2 16.0 20.9 55.3 28.4 21.7 20.1 18.0 13.5 18.1 15.0 17.9 13.7 16.2 18.0
Havells India (HAVIND) 708 800 Buy 44,172 11.4 13.4 17.2 62.0 52.8 41.2 42.1 35.4 27.2 25.2 29.2 31.1 18.8 21.4 22.7
Kansai Nerolac (KANNER) 448 390 Hold 24,144 9.6 10.1 11.1 46.8 44.4 40.3 24.5 22.9 18.7 24.5 24.4 26.1 16.5 16.6 16.3
Pidilite Industries (PIDIND) 1,126 1,250 Buy 57,723 18.8 18.5 22.0 59.7 60.8 51.1 42.2 38.6 32.5 33.6 29.6 31.4 27.0 21.7 22.8
Essel Propack (ESSPRO) 98 120 Hold 3,079 5.5 5.8 6.7 17.7 16.9 14.5 8.9 8.3 7.2 18.0 17.4 19.3 15.2 14.6 15.8
Supreme Indus (SUPIND) 997 1,075 Hold 12,665 33.9 38.9 43.0 29.4 25.6 23.2 15.9 15.1 12.9 27.9 28.0 29.0 22.7 22.0 22.5
Symphony (SYMLIM) 1,210 830 Hold 8,465 27.5 20.5 27.6 44.0 59.0 43.8 35.9 34.7 24.2 41.3 27.3 35.2 31.5 24.2 30.7
V-Guard Ind (VGUARD) 201 168 Hold 8,556 3.1 3.7 4.8 64.1 54.8 42.0 39.6 33.9 26.0 23.7 26.0 28.4 17.7 19.7 21.6
Voltas Ltd (VOLTAS) 533 560 Hold 17,628 17.5 17.3 21.8 30.5 30.9 24.5 27.2 24.3 19.3 19.8 21.9 23.6 14.8 16.0 17.7
Time Techno (TIMTEC) 98 125 Hold 2,216 8.0 8.0 11.1 12.3 12.3 8.9 6.8 6.7 5.4 14.9 13.7 16.2 12.2 11.2 13.6
Source: Company, ICICI Direct Research

ICICI Securities Ltd | Retail Equity Research Page 8

RATING RATIONALE
ICICI Direct Research endeavours to provide objective opinions and recommendations. ICICI Direct Research
assigns ratings to its stocks according to their notional target price vs. current market price and then
categorises them as Strong Buy, Buy, Hold and Sell. The performance horizon is two years unless specified and
the notional target price is defined as the analysts' valuation for a stock.

Strong Buy: >15%/20% for large caps/midcaps, respectively, with high conviction;
Buy: >10%/15% for large caps/midcaps, respectively;
Hold: Up to +/-10%;
Sell: -10% or more;

Pankaj Pandey Head – Research pankaj.pandey@icicisecurities.com

ICICI Direct Research Desk,

ICICI Securities Limited,
1st Floor, Akruti Trade Centre,
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ANALYST CERTIFICATION
We /I, Sanjay Manyal, MBA (Finance) and Hitesh Taunk, MBA (Finance) Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research
report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s)
or view(s) in this report. It is also confirmed that above mentioned Analysts of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months
and do not serve as an officer, director or employee of the companies mentioned in the report

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ICICI Securities Ltd | Retail Equity Research Page 10