Stock Note 19 May 2016

RETAIL RESEARCH
Muthoot Finance Ltd
Industry CMP Recommendation Add on Dips to band Sequential Targets Time Horizon
NBFCs Rs. 218 Buy at CMP and add on declines Rs. 196-204 Rs. 243 - Rs. 258 2-3 quarters
Muthoot Finance Ltd is India’s largest, niche gold finance company with an AUM of ~Rs250 bn in Dec 2015, with a robust
HDFCSec Scrip Code MUTFINEQNR 38% CAGR over FY09-15. Headquartered in Kochi (Kerala), the company is majority owned by the Muthoot family (75%
BSE Code 533398 stake as of March-2016).
NSE Code MUTHOOTFIN Investment Rationale
Bloomberg MUTH IN  Gold loan NBFCs returning to stability post the storm
 Regulatory clarity and strong retail franchise
CMP(as on 18 May, 16) Rs.218
 Gold prices have largely remained steady for the last one year and are now on the way up
Equity Capital (Rs crs) 399  Muthoot Finance is expanding its presence in the western region through Muthoot Homefin- for financing affordable
Face Value (Rs.) 10.0 housing in the coming days.
 RBI’s draft guidelines for on tap bank licences for NBFCs may open up a new opportunity for Muthoot Finance.
Eq Sh Outstandiing crs 39.9
Market Cap (Rs crs) 8698.2
Risks and Concerns
 Collateral Risk
Book Value (Rs) 127.7  Credit & interest rate Risk
Avg. 52 Week Volumes 261715  Liquidity Risk
52 Week High Rs. 236.8 Outlook and view
52 Week Low Rs. 151.0 Over 2012 to 2015 the gold loan industry was dragged down by various regulatory pressures. With a more stable regulatory
environment, healthy RoE, expected improvement in RoA, low asset quality risk and a gradual pick-up in loan growth in the
medium term, we believe Muthoot’s valuations are quite attractive. Moreover, its dividend yield is also healthy at close to
Shareholding Pattern (March 2016) 2.5%. While recent growth rates have been sluggish, current valuations leave room for improvement if the rural economy
Promoters 74.64 and SME/trade community see better times and its growth rate breaks into higher trajectory. We think that investors could
buy the stock at the CMP and add on declines to Rs. 196-204 band (1.25x-1.3x FY18E Adj. BV) for sequential targets of Rs. 243
Institutions 20.86 and Rs. 258 (1.55x and 1.65x FY18E Adj. BV) over 2-3 quarters.
Non Institutions 4.50
Financial Summary
Total 100.00 Particulars (Rs mn) FY14 FY15 FY16E FY17E FY18E
NII 23,019 22,074 22,678 25,000 28,307
Fundamental Research Analyst: Total income 23,214 22,183 23,303 25,682 28,989
Zececa Mehta PPP 12,957 11,542 12,247 13,516 15,495
zececa.mehta@hdfcsec.com PAT 7,801 6,706 7,263 8,030 8,996
EPS 21.0 16.9 18.3 20.2 22.7
Adj. BVPS 108.2 122.4 133.4 144.3 156.3
(Source: Company, HDFC Sec)

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Business Overview
Muthoot Finance Ltd is India’s largest, niche gold finance company with an AUM of ~Rs250 bn in Dec 2015, with a robust 38%
CAGR over FY09-15. Headquartered in Kochi (Kerala), the company is majority owned by the Muthoot family (75% stake as of
March-2016). It currently has 4,259 branches and presence across 27 states/union territory in the country. However, its
footprint is concentrated mostly in the South with ~65% of the branches and 56% of total loans concentrated in the four
southern states of Kerala, Andhra Pradesh, Tamil Nadu and Karnataka.

Muthoot has ~7mn customers with an average ticket size per loan of ~Rs. 36,000. While loans are typically disbursed with
tenure of 6-12 months, most of the loans are repaid within six months – implying average duration of close to six months for
the loans.

Investment Rationale
Gold loan NBFCs returning to stability post the storm
Post a stellar run during FY08-12, India’s gold finance NBFCs had undergone significant turmoil in the next three years—led
by the changing regulatory landscape and steep decline in international and domestic gold prices. While stricter norms led to
a slowdown in growth, steep decline in gold prices brought asset quality pressures; this forced most gold-financing players to
shrink their loan books over the period.
In our view, the industry has started to stabilize now and is poised to return to growth from here on in as:
 The regulatory environment has stabilized with gold financing NBFCs following stricter regulatory norms than most
other asset financing NBFCs
 Competitive intensity has rationalized with many smaller players exiting this segment and market shares starting to
consolidate with fewer and larger banks and non-banking finance companies
 International gold prices have already stabilised and are now on the way up
 Domestic economic revival is likely to boost demand for loans again, especially in the small and mid-sized towns and
rural centres
 Distress in select pockets of the country (due to inadequate rainfall in the last two years) could also lead to higher
demand for gold loans
 Asset quality concerns have stabilized as most of the pain is over and should abate over the medium term.

Regulatory benefits
Over the last couple of years, RBI has tightened the regulatory requirements (LTV (loan to value), valuation methods, branch
opening and cash disbursements), which has further strengthened the gold loan business model. Further, LTV cap of 75% for
banks, augurs well for the gold loan financing companies and creates a level playing field. Given its leadership position in
gold loans and the low cost advantage, Muthoot will be the largest beneficiary as and when there is revival in the broad
economy.

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Changes in norms for loan against gold jewellery
Norms Mar-12 to Sept-13 Since Sep-13 For Banks (current)
LTV 60% 75% (since Jan-14) 75%
Pricing Not specified Last 30 days average price of 22 carat gold Last 30 days average price of 22 carat gold
as quoted by Bombay Bullion Association as quote by Bombay Bullion Association
Mode of disbursal Not specified Disbursals above Rs. 100,000 to be done Entirely through Cheque
through cheque
Risk weights 100% 100% 0-20% for loans below 75% LTV
NPL Recognition 180 days 180 days now, to move to 90 days by 90 days
March 2018
Tier 1 capital ratio 12% 12% 6.125% by March 15, increasing gradually to
8% by March 18

Strong retail franchise

Muthoot’s huge retail franchisee comprising of 4,259 branches and 23,000 employees make its well positioned to increase its
business without incurring any significant increase in operating costs (Cost to income ratio 48% in FY15). Given that 80% of
the company’s operating costs are fixed in nature, a rebound in business will lead to optimum utilization of the existing
infrastructure. Muthoot has been cutting down lending rates in order to appeal to the middle class and compete with other
products such as unsecured loans and consumer finance which will further help in improving its market share.

It now has its focus on diversified presence across India, South Region now constitutes 65% of the branch network.
Widespread branch network has enabled AUM diversification with South now contributing 56% of the total AUM (as on Dec
2015) as compared to 74% in March 2011. The company is concentrating on the Western region of India whose contribution
to gold loan portfolio is increased from 8% in March 2011 to 16% in Dec 2015.

Reducing competition
Low gold loan penetration, stabilizing/rising gold prices, exit/lower focus area from various small/new players has reduced
the competitive intensity. Further with level playing field vs. banks, regulatory concerns behind, coupled with launch of
newer products, we believe Muthoot being the market leader with large branch network is well placed to capture the huge
opportunity.

In the medium term, one of the key challenges for private sector players, especially gold financing NBFCs, could come from
public sector banks which have turned aggressive on collateralizing agricultural loans with gold as additional collateral and
also from the expected entry of small finance banks, which could erode market shares for non-banking finance companies.

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Loan book to pick up
Muthoot has made concerted efforts to push gold loans, via strong marketing efforts, innovative products, focus on new
segments such as the salaried class and even massively cutting down interest rates. These efforts while showing no
immediate impact on loan book which was flat sequentially in Q3FY16, is expected to push loan book going forward.

Gold prices have largely remained steady for the last one year
Global gold prices fell ~41% from their peak of USD 1,791/oz during Oct 2012, while domestic gold prices fell ~30% lower
from the peak of Aug 2013 of Rs. 3110/gm to Rs. 2223.9/gm in July 2015. Deterioration in Muthoot’s asset quality in Q1FY14
was on the back of sharp decline in global gold prices, which declined from ~Rs. 2965/gm to Rs. 2,277/gm (~23.2%) within a
six-month period. However, Indian gold prices have remained broadly stable over the past year—hovering around an average
of Rs. 2,400-2,500/gm, leading to stabilization in asset quality. They have now risen to Rs.2900-3000/gm.

While prices fell sharply till mid 2015 and we believe should stabilize medium term, predicting a bottom for global gold prices
is a challenging task. Having said that, in Q3FY16, GNPA at 2.53% at an average quarterly gold price of Rs. 23,400, was lower
than GNPA in Q2FY16 of 2.55% when the average quarterly gold price was Rs. 23,488. A sharp fall in gold prices, especially in
a 3-6 month period, remains a key risk for the sector.

Notwithstanding the risk of a fall in gold prices, we take comfort in Muthoot’s strong asset quality over the last couple of
years despite the sharp fall in gold prices. Falling gold prices, we believe, are more a growth risk than an asset quality risk for
stronger players like Muthoot.

Asset quality issues well managed despite unfavorable environment

Post the sharp decline in gold prices during March-June 2013, certain gold loan NBFCs faced asset quality issues. However,
Muthoot managed the situation well— reflected in 2% GNPAs despite unfavorable regulatory environment coupled with
sharp volatility in gold prices. The company is also maintaining a standard asset provisioning of 0.52% compared with the
mandated regulatory requirement of 0.25%.

Muthoot’s NPAs shot up by 50bp in Q4FY13 to 2% owing to a sharp fall in gold prices. However, the NPAs since then have
broadly remained at the same levels and touched 2.53% in Q3FY16, down from 2.55% in Q2FY16. In our view, the regulatory
changes, which capped the LTVs at 75%, have played a crucial role in stabilizing the asset quality. Further, we expect
stabilizing gold prices and lower LTVs to aid in reducing stress over the medium term.

Muthoot Finance is expanding its presence in the western region through Muthoot Homefin- for affordable housing
finance in the coming days.
Muthoot Homefin India Ltd (MHIL) was started by the promoters a year back with 100% holding and a capital of Rs. 10.5
crore. But in March 2016, Muthoot Finance acquired 3.95 crore equity shares of MHIL (79% stake in MHIL) thus increasing
the total capital base to Rs. 50 crore. In the one year of operation of MHIL, its AUM came in at Rs. 25-30 crore. The

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management of Muthoot Finance expects this business to grow in next three years and has targeted an AUM of Rs. 1500-
2000 crore (for which Muthoot Finance will provide capital as and when required).

MHIL has done some business in Kerala where it got the license earlier, and has done about Rs. 25-30 crore of business in
Kerala. The company is tapping the potential customers who take gold loan from Muthoot and simultaneously can access to
home finance segment. The company has some records of credit history and credit payment available in Muthoot Finance
through the CBS system, which they can leverage in selling the housing finance loans.

Muthoot Finance has got a very good presence in Delhi and Mumbai with around 200 offices in and around Mumbai,
predominantly for the gold loan business. But MHIL being a relatively new venture, the company will first concentrate on
markets of Kerala and Maharashtra (in Mumbai the company has recently set up an office in Goregaon) and then gradually
would tap the other markets. The lead generation for the home finance business is happening through the offices of Muthoot
Finance, which has more than 4,200 branches and offices throughout India.

Asia Asset Finance PLC – Sri Lankan subsidiary

Asia Asset Finance PLC, (AAF) Colombo, Sri Lanka became a foreign subsidiary of Muthoot Finance on December 31, 2014. As
on March 31, 2015, total holding in AAF stood at 428 million equity shares representing 51% of their total capital. AAF is a
Registered Financial Company based in Sri Lanka a fully licensed, deposit-taking institution registered with the Central Bank
of Sri Lanka and listed in the Colombo Stock Exchange. AAF is in lending business since 1970. At present the company is
involved in Retail Finance, Hire Purchase & Business Loans and has 15 branches across Sri Lanka.

In FY16 AAF has also done exceedingly well. The company has grown its books by about 36 percent and its asset base is also
increased by 7 billion Sri Lankan rupees. AAF has introduced the gold loan scheme and also the micro finance portfolio in Sri
Lanka which is showing good traction there. In 9MFY16, AAF earned revenue of Rs. 45.03 crore (in FY15 it was Rs. 44.48
crore) and PAT of Rs. 5.54 crore (in FY15 it was Rs. 4.74 crore). Total Assets for 9MFY16 came in at Rs. 328.23 crore which in
FY15 was Rs. 250.74 crore.

RBI’s draft guidelines for on tap bank licenses may open up a new opportunity for Muthoot Finance.
The Reserve Bank of India (RBI) on May 05, 2016 released draft guidelines for issuing on-tap universal bank licenses but
excluded large industrial houses from entering the sector. The proposed licensing policy is a change from the current stop-
start policy where RBI opens the window for bank licenses periodically but rarely. Existing NBFCs that are “controlled by
residents” and have a successful track record for at least 10 years are among those that can apply for on-tap licenses.
Although Muthoot Finance had applied in the round of banking licenses in 2014 (and did not succeed), it feels that it has a
case for applying for a Bank license, after the final guidelines are issued. A Bank license could allow Muthoot Finance to raise
low cost deposits (given its spread of branches and the reputation that it has built) and do other activities, although the
requirement of CRR, SLR, and priority sector lending, minimum paid-up capital for a bank of Rs.500 crore will have to be met.

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Peer Comparison – With Manappuram Finance
Particulars Muthoot Finance Manappuram Finance
Businesses Into Core - Gold Loans Core - Gold Loans
New Services - Money Transfer, Collection, New Services - Loan for Commercial Vehicles,
White Label ATM, National Pension Microfinance, Mortgage & Housing Finance
Scheme, Wind Mill Power Generation,
Housing Finance (through its subsidiary)
No. of Branches (Dec 2015) 4259 3293
Customer Base 6.9 mn 1.85 mn
AUM as on Dec 2015 (Rs. in mn) 249907 105790
% of Branches region wise South - 65 South - 69
North - 16 North - 16
West - 14 West - 10
East - 5 East - 5
Avg Ticket Size (Rs.) 35630 30763
Shareholding Pattern (March 2016) Promoters - 74.64% Promoters – 33.69%
FII, MF & Others - 20.86% FII, MF & Others – 40.06%
Public – 4.5% Public – 26.25%
Net Interest Income (NII, FY15) Rs. 2207.4 crore Rs. 1085 crore
Net Profit (FY15) Rs. 670.6 crore Rs. 271 crore
Adjusted Book Value (FY15) Rs. 127.7 Rs. 30.13
Net NPA (FY15) 0.9% 1.0%
RoA (FY15) 3.0% 2.46%
Dividend per Share (FY15) Rs. 6 Rs. 1.8
Dividend Payout as on FY15 (%) 42.4 55.8

Muthoot Finance is much bigger than Manappuram Finance on almost all accounts. Also the float available to public is less
than that of Manappuram.

Risks/Concerns
Collateral Risk
This risk arises from the decline in the value of the gold collateral due to fluctuation in gold prices. However, this risk is in part
mitigated by at least 25% margin retained on the value of jewellery for the purpose of calculation of the loan amount, i.e. the
company lends maximum of only 75% of the value of jewellery. Further, risk is reduced because the price of gold jewellery is
higher given that the production costs, design cost and the gemstones associated with making the item is not considered for
arriving at the value of jewellery for the calculation of the loan amount. Having said that, gold prices do have an impact on
the Gross NPA ratios of Muthoot Finance.

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When gold prices are on up move, GNPA is low and vice versa as shown in the chart above. But the management is of the
view that the gold prices would going forward remain steady and would not be very volatile like in Q3FY13.

Further Muthoot will move to 150dpd NPA recognition norms from Q4FY16; this may however not lead to higher NPAs due
to better expected recovery.

Credit Risk
This risk denotes the possibility of loss due to the failure of any counterparty to abide by the terms and conditions of any
financial contract. This risk is mitigated by a rigorous loan approval and collateral appraisal process, strong NPA monitoring
and collection strategy. This risk is further diminished because the gold jewellery used as collateral for loans can be readily
liquidated.

Interest Rate Risk

This risk reflects potential losses arising from the movement in interest rates. To avoid excessive exposure of Muthoot’s
earnings and equity to loss and to reduce its exposure to the volatility inherent in financial instruments, majority of the
company’s borrowings, and all the loans and advances it makes, are at fixed rates of interest. This minimises the company’s
interest rate risk.

Liquidity Risk
Liquidity management is to ensure sufficient cash flow to meet all financial commitments and to capitalise on opportunities
for business expansion. The nature of business is such that source of funds, primarily proceeds from issue of debentures and
bank loans has longer maturities than the loans and advances given resulting in low liquidity risk

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Sluggish growth in AUM
Muthoot’s AUM has grown 0.5% QoQ and 13.1% YoY in Q3FY16. This is below that reported by its smaller peer Manappuram
whose growth in AUM YoY has been 19%. This has also resulted in Muthoot lagging in terms of NII and PAT growth. Muthoot
so far has been more impacted by weakness in the rural economy (due to poor monsoon) and subdued economic
environment (that has impacted bridge loan financing demand from SME and traders).

Compared to its peer Manappuram Finance, Muthoot is not present in Microfinance, CV finance and is a late entrant in
Housing finance.

Financials
Q3FY16 Result Review
Muthoot Finance reported QoQ flat loan book in Q3FY16. However, the company was able to arrest consistent five quarters
of NIM compression likely supported by lower bank base rates. Stable NIM at 9.04% coupled with improving operating
leverage will support earnings until visibility on loan growth improves. Net interest income was up 4.6% YoY to Rs. 563.2
crore. PAT was up 20.9% YoY (up 7% q-o-q) due to good control on the operating expenses. RoA at 14%, Gold AUM was up by
13.3% YoY to Rs. 24940.9 crore, Gross NPA came in at 2.53% (as against 2.55% in Q2FY16), Net NPA came in at 2.19%, Gold
holdings at 145 tonnes, 56% AUM in south, 22% in north, 16% in West.

Conclusion
Over 2012-2015 the gold loan industry has been dragged down by various regulatory pressures. With a more stable
regulatory environment, healthy RoE, expected improvement in RoA, low asset quality risk and a gradual pick-up in loan
growth in the medium term, we believe Muthoot’s valuations are quite attractive. Moreover, its dividend yields are also
healthy at close to 2.5%. While recent growth rates have been sluggish, current valuations leave room for improvement if the
rural economy and SME/trade community see better times and its growth rate breaks into higher trajectory. Muthoot
Finance has the highest rating among gold loan companies for short term paper. Its capital adequacy of 23.37% (Dec 2015) is
well above the regulatory minimum of 15%. We think that investors could buy the stock at the CMP and add on declines to
Rs. 196-204 band (1.25x-1.3x FY18E Adj. BV) for sequential targets of Rs. 243 and Rs. 258 (1.55x and 1.65x FY18E Adj. BV)
over 2-3 quarters.

Particulars (Rs mn) FY14 FY15 FY16E FY17E FY18E

NII 23,019 22,074 22,678 25,000 28,307
Total income 23,214 22,183 23,303 25,682 28,989
PPP 12,957 11,542 12,247 13,516 15,495
PAT 7,801 6,706 7,263 8,030 8,996
EPS 21.0 16.9 18.3 20.2 22.7
Adj. BVPS 108.2 122.4 133.4 144.3 156.3
(Source: Company, HDFC sec)

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Financials
Profit & Loss – Standalone
Particulars (Rs mn) FY14 FY15 FY16E FY17E FY18E
Interest income 49,279 43,138 45,107 47,782 54,595
Interest expenses 26,260 21,064 22,429 22,783 26,289
NII 23,019 22,074 22,678 25,000 28,307
% Growth -9 -4 3 10 13
Other income 195 108 626 682 682
Total income 23,214 22,183 23,303 25,682 28,989
% Growth -10 -4 5 10 13
Operating expenses 10,732 11,482 11,635 12,818 14,569
- Staff Expenses 5,917 6,304 6,535 7,476 8,496
- Other Expenses 4,815 5,178 5,099 5,342 6,074
PPP 12,957 11,542 12,247 13,516 15,495
Provisions & Contingencies 547 421 452 510 580
Pre-tax profit 11,936 10,279 11,217 12,354 13,840
Prior Period Adjustment 0 0 0 0 0
Tax expense 4,135 3,573 3,953 4,324 4,844
Tax Rate (%) 35 35 35 35 35
PAT 7,801 6,706 7,263 8,030 8,996
Growth % -22 -14 8 11 12
(Source: Company, HDFCSec,)
Balance Sheet – Standalone
Particulars (Rs mn) FY14 FY15 FY16E FY17E FY18E
Share capital 3,717 3,980 3,980 3,980 3,980
Reserves & Surplus 38,929 46,855 51,365 56,136 61,407
Net worth 42,646 50,835 55,345 60,116 65,387

Borrowings 1,94,839 1,94,647 2,04,225 2,32,213 2,67,182

Other liabilities 16,408 20,779 23,387 26,322 29,626
Total liabilities 2,51,961 2,66,261 2,82,957 3,18,651 3,62,195

Cash & Bank Balances 20,489 18,154 15,031 16,518 18,868

Investments 354 385 433 487 549
Advances 2,16,197 2,33,499 2,51,140 2,83,241 3,22,063
Fixed assets 3,270 2,642 2,973 3,346 3,766
Other current assets 11,651 11,887 13,379 15,058 16,948
Total assets 2,51,961 2,66,567 2,82,957 3,18,651 3,62,195
(Source: Company, HDFCSec,)

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Key Financial Ratios – Standalone
Particulars FY14 FY15 FY16E FY17E FY18E
Per share data
EPS 21.0 16.9 18.2 20.2 22.6
BV 114.7 127.7 139.1 151.0 164.3
Adj BV 108.2 122.4 133.4 144.3 156.3
DPS 5.0 5.5 6.0 7.0 8.0
Spread Analysis (%)
Yield on Advances 20.5 19.2 18.6 17.9 18.0
Yield on Assets 20.5 19.2 18.6 17.9 18.0
Cost of funds 12.1 10.8 11.2 10.4 10.5
Interest Spread 8.4 8.4 7.4 7.4 7.5
Net Interest Margin 8.9 9.0 8.8 8.8 8.8
Return ratios
RoA 3.2 3.0 3.0 3.0 3.0
RoE 19.5 14.3 13.7 13.9 14.3
Asset quality ratios (%)
Gross NPAs 3,243 3,035 3,265 3,682 4,187
Net NPAs 2,443 2,135 2,265 2,682 3,187
Net NPAs / Total Assets 1.1 0.9 0.9 0.9 1.0
Net NPAs / Net worth 5.73 4.20 4.09 4.46 4.87
Provision coverage 24.7 29.6 30.6 27.2 23.9
Capitalisation ratios (%)
Tier I cap.adequacy 18.0 20.9 20.1 21.6 23.2
Total cap.adequacy 22.7 21.9 22.1 22.3 24.0
Total Assets/Equity 5.9 5.2 5.1 5.3 5.5
Loans/Assets 0.9 0.9 0.9 0.9 0.9
Investments/Assets 0.0 0.0 0.0 0.0 0.0
Efficiency ratios (%)
Cost to income 44.2 48.0 47.4 47.4 46.5
Cost to average assets 4.3 4.7 4.6 4.6 4.5
Productivity ratios (Rs mn)
Operating cost per employee 0.4 0.5 0.5 0.5 0.6
Assets per employee 10.1 11.6 12.2 13.4 14.9
Adjusted net profit per employee 0.3 0.3 0.3 0.3 0.4
Valuation ratios (x)
PER 10.4 12.9 11.9 10.8 9.6
Price/ Book value 1.9 1.7 1.6 1.4 1.3
Price/Adjusted book 2.0 1.8 1.6 1.5 1.4

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Yield (%) 2.3 2.5 2.8 3.2 3.7
(Source: Company, HDFCSec)
One Year Price Chart

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Fundamental Research Analyst: Zececa Mehta (zececa.mehta@hdfcsec.com)

HDFC securities Limited, I Think Techno Campus, Building - B, "Alpha", Office Floor 8, Near Kanjurmarg Station, Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042 Phone: (022) 3075 3400 Fax: (022) 2496 5066 Website:
www.hdfcsec.com Email: hdfcsecretailresearch@hdfcsec.com.
____________________________________________________________________________________________________________________________________________________________________________________________

"HDFC Securities Ltd. is a SEBI Registered Research Analyst having registration no. INH000002475."

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but not restricted to, fluctuation in the prices of shares and bonds, changes in the currency rates, diminution in the NAVs, reduction in the dividend or income, etc.

HDFC Securities Ltd and other group companies, its directors, associates, employees may have various positions in any of the stocks, securities and financial instruments dealt in the report, or may make sell or purchase or other
deals in these securities from time to time or may deal in other securities of the companies / organizations described in this report.
HDFC Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have been mandated by the subject company for any other assignment in the past twelve months.
HDFC Securities or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from the date of this report 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 in the normal course of business.
HDFC Securities or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither HDFC
Securities nor Research Analysts have any material conflict of interest at the time of publication of this report. Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage
service transactions. HDFC Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.
Research entity has not been engaged in market making activity for the subject company. Research analyst has not served as an officer, director or employee of the subject company. We have not received any
compensation/benefits from the subject company or third party in connection with the Research Report.
This report has been prepared by the Retail Research team of HDFC Securities Ltd. The views, opinions, estimates, ratings, target price, entry prices and/or other parameters mentioned in this document may or may not match or
may be contrary with those of the other Research teams (Institutional, PCG) of HDFC Securities Ltd.

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