1breport.myiris.com/mr1/exiindus_20110419.pdfexide industries ltd- ‘lead’ing edge strong buy...

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Microsec Research19 April 2011

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TABLE OF CONTENTS:

R&D & Technological Collaboration………………

Usage of Batteries in Different Sectors……………

Backward Integration & capacity expansion………

Peer Group………………………………………………

Financials………………………………………………… 14 - 14

Disclaimer……………………………………………… 20 - 20

Valuation………………………………………………… 13 - 13

Risks……………………………………………………… 13 - 13

09 - 10

10 - 11

11 - 11

12 - 12

Key Management Profile……………………………… 12 - 12

Industry Overview……………………………………… 07 - 07

Investment Thesis……………………………………… 08 - 11

Distribution Network, Services & branding……… 08 - 09

Subsidiary & Associated Companies 06 - 07

Operational Segments……………………………… 05- 06

Segment…………………………………………… 05 - 05

Manufacturing Facility ………………………… 05 - 06

History and Background…………………………… 04 - 04

Business Overview……………………………………… 05- 07

Topic Page Number

Investment Highlights………………………………… 03 - 03

Company Overview…………………………………… 04 - 04

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We rate Exide Industries Ltd (Exide) a BUY. Our rating underpins the company’s strong

distribution network, after-sales services, usage of products in different sectors, backward

integration, R&D & technological collaboration. However, fierce competition from the

unorganized players impedes our optimism a bit.

Investment Highlights

Wide Distribution Channels, After Sales Services and Brand Recall enhance overall growth.

Exide enjoys a dominant presence in domestic as well as international markets. In addition to

that, company’s performance is likely to be supported by strong brand recall and after sales

services.

R&D and Technological Collaborations give competitive advantage. By the skilled workforce,

R&D and Technological collaborations with foreign companies, Exide has bagged some patents

for new processes and grid structures like design patent on 75D31R/95D31RMF batteries, leak

resistant automotive battery, and method of manufacturing lead based alloy that leads to the

competitive advantage.

Wide usage of battery in different sectors boost the top line growth. Apart from automotive

sector, Exide battery is used in power back up including inverters, UPS, base station in

telecom tower, forklift and in railways for signaling, lighting of coach which has expected

18% CAGR growth prospect over FY2011-2013.

Backward Integration along with capacity addition in two lead smelters improve margins.

Acquisition of two lead smelters such as Chloride Metals and Leadage Alloys India reduce

dependency on imported lead that is likely to improve margins. In addition to that, Exide is

planning to increase the overall capacity of lead smelters from 96,000 MTPA to 140.000

MTPA by FY2012 which is likely to boost performance.

Exhibit 1. Exide – Financial Performance at a glance

Particulars (In `Mn) FY2008 FY2009 FY2010 FY2011E FY2012E FY2013E

Revenue 29,798.30 34,048.70 39,788.60 45,165.59 54,503.40 60,001.94

Growth(%) 50.43% 14.26% 16.86% 13.51% 20.67% 10.09%

EBITDA 4,869.70 6,001.70 9,771.80 9,386.49 12,295.01 13,692.85

EBITDA Margins (%) 16.34% 17.63% 24.56% 20.78% 22.56% 22.82%

Net Profit 1,643.00 2,145.50 4,935.20 5,617.84 7,542.50 8,361.03

Net Profit Margins (%) 5.51% 6.30% 12.40% 12.44% 13.84% 13.93%

Net Profit Growth (%) 139.71% 30.58% 130.03% 13.83% 34.26% 10.85%

EPS 2.16 2.39 6.15 6.61 8.87 9.84

BVPS 9.32 10.25 18.13 26.24 34.96 45.96

P/E 31.06 17.34 20.18 21.19 15.78 14.24

P/BV 7.20 4.05 6.85 5.34 4.01 3.05

EV/EBITDA 11.25 6.77 10.38 12.59 9.05 7.24

ROE 23.18% 23.33% 33.93% 25.19% 25.38% 21.40%

Source: Company Data, Microsec Research

Exide Industries Ltd- ‘Lead’ing Edge

Strong Buy Sector- Battery

Current Market Price (INR) 140.05

Target Price (INR) 174.48

Upside (%) 24.58%

52 Week High / Low (INR) 179.8 / 109.05

Market Capitalization (In INR Mn) 119,042.50

Market Data

Promoter and

Promoter

Group45.99%

Institutions

31.17% Corporate Bodies

10.84%

Individuals

11.36%

Others

0.64%

Shareholding

Research Analyst: Gargi Deb

Email : [email protected]

Phone Number : 91 33 3051 2100

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0

30

60

20-Apr-10 20-Jul-10 19-Oct-10 18-Jan-11 19-Apr-11

Ret

urn

(%

)

Exide Sensex

BSE Code 500086

NSE Code EXIDEIND

Bloomberg Ticker EXID IB

Reuters Ticker EXID.BO

Face Value (INR) 1.00

Equity Share Capital (In INR Mn) 850.00

Average P/E 38.86

Beta vs Sensex 1.08

Average Daily Volume 316,212

Dividend Yield 0.93%

PEG Ratio 1.10

STOCK SCAN

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Company Overview

Exide is a leading battery manufacturer of both conventional flooded as well as VRLA

batteries in the South and South East Asia. Exide has two lead smelters and six manufacturing

facilities that are strategically located all over India. The batteries of the company have been

used in automotive, telecom, power back up, defense and railways. Exide has a wide

distribution networks that includes 41,500 retail outlets for the aftermarket sales-services. It

exports its products to Africa, Australia, South and South East Asia. By the constant

innovation, modernization of manufacturing processes, country wide service networks, Exide

has grown steadily and become the solution provider along with manufacturer of storage

batteries.

History

The brief growth path of Exide is as follows:

Exhibit 2. Milestone of Exide


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Business Overview

Exide divides its operations into three major segments – Automotive, Industrial and

Submarine. This segmentation is primarily based on the company’s customer profile. In

addition, Exide segregates its revenues based on geographies as well.

Segments

Exide manufactures and sells a wide range of battery which is used in mainly three segments

such as Automotive, Industrial and Submarine. The company has a market share of 72% in

automotive OEM, 73% in replacement auto and 45% in industrial segment. Exide has achieved

13% sales growth in automotive battery segment. It includes sales to the vehicle

manufacturers and aftermarket sales. It designs and manufactures industrial batteries of 2.5 Ah

to 20,600 Ah in conventional flooded, VRLA and Nickel Cadmium batteries. Industrial

batteries sales growth is around 10%. The company also manufactures high end submarine

batteries to meet the defense requirements of India, Russia and Germany.

Exhibit 3. Segment wise and Geography wise Revenue Mix


Manufacturing Facilities

Exide is headquartered in Chowringhee, Kolkata. The company has six manufacturing plants

that are strategically located across the country- two in Maharashtra, two in West Bengal, one

in Tamil Nadu and one in Haryana. The details of these plants are as follows:

Exhibit 4. Manufacturing Plants


62%

37%

1%

Segment wise revenue distribution

Automotive Industrial Submarine

93%

7%

Geography wise revenue distribution

India Overseas

Plants Incorporation Location Production & Capacity Products ISO certifications

Shamnagar 1946 WB Auto‐1.68 Mn , Ind‐ 265 Mn of Ah Tubular batteries ISO 9001, TS‐16949, ISO 14001

Chinchwad 1969 Maharashtra Auto‐ 2.16 Mn , MC‐ 4.20 Mn VRLA batteries TS‐16949, ISO 14001

Haldia 1981 WB Auto‐1.92 Mn, Ind‐552 Mn of Ah Mono Bloc batteries ISO 9001, TS‐16949, ISO 14001

Hosur 1997 Tamil Nadu Auto‐2.4 Mn, Ind‐780 Mn of AhSemi Traction, Solar

PV, VRLA batteries

ISO 9001, TS‐16949, ISO 14001,

OHSAS 18001

Taloja 1998 Maharashtra Auto‐2.04 MnSemi Traction

Batteries TS‐16949, ISO 14001

Bawal 2003 Haryana MC‐6.6 Mn VRLA batteries TS‐16949

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These plants have a combined capacity of 24.24 Mn units. In FY 2010, Exide has manufactured

16.2 MM auto and 1,565 MM Ah industrial batteries. To cater the growing demand, Exide has

set up new manufacturing facilities at Ahmednagar, Maharashtra. Exide is likely to spend `4

Bn to increase the overall capacity.

Subsidiary and Associated Companies

Exide has four domestic and three international subsidiaries that are situated in Sri Lanka,

Singapore and UK. Chloride International Ltd, a 100% subsidiary is engaged in the business of

battery which is used in solar home lighting, inverter. Exide has 100% holding in Caldyne

Automatics Ltd which is engaged in the business of chargers that has been used in DC power

systems and associated equipment. It has manufacturing facility at Salt Lake in Kolkata. Mr. G

Chatterjee is the Chairman of this company.

Exhibit 5. Partial Income Statement of Chloride International & Caldyne Automatics (`Mn)


Chloride Metals, formerly known as Tandon Metals is in the business of lead smelting and

refining operations. It is a 100% subsidiary and its plant is located at Markal, Pune. Through

this acquisition in 2007, Exide focused to increase the source of lead. The 51% stake in

Leadage Alloy India was acquired during 2008. In 2010, the stake of Exide has been increased

to 100%. Leadage Alloy India is situated at Kolar district, Karnataka to manufacture and

supply recycled lead.

Exhibit 6. Partial Income Statement of Chloride Metals & Leadage Alloys India (`Mn)


The stake in Associated Battery Manufacturers has been increased from 49% to 61.5% during

the time span of 2000 to 2004. The company is situated in Sri Lanka to manufacture lead acid

automotive and motorcycle batteries. In 2000, Exide has acquired 100% stake in Chloride

Batteries SE Asia Pte Ltd in Singapore to cater the South East Asian and Australian markets.

The company is in the business of production, distribution of industrial battery chargers,

rectifiers.

Chloride International Ltd

Particulars FY2007 FY2008 FY2009 FY2010

Revenue 98.4 61.7 36.6 120

PBT 3.5 1.5 0.1 3.7

PBT Margin(%) 3.56% 2.43% 0.27% 3.08%

Caldyne Automatics Ltd


Revenue 229.032 326.848 316.5 370

PBT 6.4 9.3 3.8 15.4

PBT Margin(%) 2.79% 2.85% 1.20% 4.16%

Chloride Metals Ltd


Revenue 261.047 614.987 1530 2640

PBT 10.106 22.43 73.3 150

PBT Margin(%) 3.87% 3.65% 4.79% 5.68%

Leadage Alloys India Ltd

Particulars FY2008 FY2009 FY2010

Revenue 2744 4440 5460

PBT 113.3 74.5 540

PBT Margin(%) 4.13% 1.68% 9.89%

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Exhibit 7. Partial Income Statement of Associated Battery Manufacturers & Chloride Batteries (`Mn)


In 2003, Exide acquired 51% stake in Espex Batteries Ltd, UK for supplying industrial batteries

in UK and its neighboring countries. During 2005, Exide has acquired 50% stake in ING Vysya

Insurance. Under the agreement, Exide could not divest its stake until October, 2010.

Exhibit 8. Partial Income Statement of Espex Batteries (`Mn)


Industry Overview

India’s automotive component industry has emerged as an important segment of the overall

economy following the deregulation policies undertaken in early 1990s. The real growth

momentum for the industry came in 1970s as demand for cars and tractors began to increase.

The overall battery market is more than ` 10,000 crores and it has grown during 2005-2010 at

a rate of 30% with average profit of 50% every year due to growing demand in automotive

sector. The target market for battery industry is mainly categorized into two segments-

Automotive and Industrial. During 2008-2010, the organized battery sector has grown at

10.2%, 18.8% rate in auto and industrial segment respectively. Automotive segment is further

sub divided into OEM and replacement market. The growth of OEM market is directly

proportionate to the growth of automobile industry. Due to the growing economy, increasing

disposable income, the automobile industry is growing 21.3% on YoY basis in the month of

February. On the other hand, battery in any vehicle has been replaced on an average of once

in two or three years. The industrial battery segment includes infrastructure, power, telecom

and railways. The high growth in the UPS and inverter application has enabled the battery

industry to post high growth in going forward. With the time, battery industry is graduating

towards the world class technology. By implementing TQM, TPM and Six Sigma, the battery

industry not only attracts a large number of foreign car makers but also keep the Chinese

competitors at bay.


Revenue 419.982 532.075 629 639.6

PBT 20.985 41.219 36.7 62

PBT Margin(%) 5.00% 7.75% 5.83% 9.69%

Associated Battery Manufacturers(Ceylon)Ltd Chloride Batteries S E Asia Pte Ltd


Revenue 926.71 1183.265 1343.1 1226.7

PBT 35.126 51.174 32.3 47.3

PBT Margin(%) 3.79% 4.32% 2.40% 3.86%

Espex Batteries Ltd


Revenue 169.55 251.633 251.9 302.1

PBT 5.817 14.054 ‐10.3 3.6

PBT Margin(%) 3.43% 5.59% ‐4.09% 1.19%

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Investment Thesis

Exide is a leading lead acid battery manufacturer and enjoying 70% market share in

automotive OEM, replacement and UPS segment. The company reported a commendable

performance over the last five years. Exide’s top line increased at a Compounded Annual

Growth Rate (CAGR) of 22.05% over FY2006-10 period and its Earnings before Interest,

Depreciation, Tax, and Amortization (EBIDTA) grew at a CAGR of 33.88% whereas its

Earnings before Interest and Tax (EBIT) jumped at an annual run rate of 39.10% over the same

period. Although the company reported a subdued performance in the last two quarters due to

capacity constraint, we expect the company report good performance through its capacity

addition in both lead smelters and battery manufacturing plants. Furthermore, the distribution

network, after sales services, R&D and Technical collaborations are likely to boost the

performance.

Exhibit 9. Revenue, EBITDA & Net Profit (In `Mn)


A detailed explanation of our key investment rational for the company is as follows:

Strong Distribution Channels, after sales services and Brand recall enhance overall growth

With the increasing proportion of costly vehicles and quality conscious people, the number of

brand oriented people has increased. In addition to that battery manufacturers can able to get

high margins and greater sales stability from the replacement segment, therefore strong

distribution channel, after sales services can be the key factors to enhance brand equity as well

as overall growth. Exide sells its products under the brand name of EXIDE, SF, SONIC,

Standard Furukawa in the domestic market and in the international markets, it sells battery

brands of DYNEX, INDEX and SONIC.

0

10000

20000

30000

40000

50000

60000

70000

Revenue EBITDA Net Profit

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Exhibit 10. Distribution Models


The company has a wide distribution channel across India with 41,500 retail outlets, around

11,350 and 1200 authorized dealers in auto and industrial battery segments respectively. To

increase the number of loyal customers, Exide not only concentrate on distribution networks

but also follow different models to serve the customers in better way. Furthermore, Exide has

introduced highly customer friendly service “batmobile”, initially in eight cities where service

is guaranteed to a car owner within an half an hour of his call from 7am till midnight and the

management is likely to cover every city under this model.

Exhibit 11. Global Presence & Dealer-Service Network


R&D and Technological Collaboration add value to the competitive advantages

In automobile and industrial battery business, R&D and technical collaboration are the

important part for continuous improvement of manufacturing process to get added advantages

in terms of patent and first mover from the competitors. In 1976, R&D center has been set up

in Kolkata. It is recognized by the Department of scientific & Industrial research under

Ministry of Science and Technology, Govt of India. Exide has a strong group of human assets

from PhD, Post Graduate holder in Engineering, Applied Science to MBA and Diploma

Model Function

Humsafar Partner network Batteries are sold by the dealers

through various motor garages to

reach the products at consumers

doorstep

Hubs and Spokes better after Sales & Warranty

services to the customers of B & C

class cities

exidereachout.com help to build out substantial number

of loyal customers

Project Kissan target rural market

C Dealer Network For heavy commercial vehicles

Kisan Dealer Network For tractor owners

OEM

Factories

Government

Institution

Branches

Main Dealer

Retailer

Customers

After Sales Staff

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holders in Engineering with a broad spectrum of experience. The company has developed the

Nano car battery, products for Hyundai’s i20 model, long life batteries for inverter, solar

applications and motorcycle based on advanced calcium technology. With the continuous

research efforts, Exide has bagged some patents for new processes and grid structures such as

design patent on 75D31R/95 D 31 RMF batteries, leak resistant automotive battery, and

method of manufacturing lead based alloy. With the growing price of lead, the main focus of

the company is to find out the lead alternatives. To protect the automotive batteries from high

temperature and rough roads in tropical countries like India, Exide has focused on developing

high temperature endurance and resistance to vibration and bumps batteries.

Furthermore, to improve the manufacturing technology, Exide has entered into strategic and

technical collaboration with the following companies.

Exhibit 12. Collaborations for Technological Support


Wide usage of battery in different sectors boost the top line growth

The current GDP growth is 9% and it is expected that India is going to be one of the fastest

growing economies in the world in the next decade. In addition to that, India is fast emerging

global manufacturing hub for the small cars. A number of global auto makers have entered the

Indian market in recent year to ride the Indian growth story. Most of these companies are not

only looking to cater the Indian market demand but also make it their primary export hub.

This is likely to act as a multiplier force for the auto component makers over the next several

years. On the other hand, Industrial battery segment such as power back up, telecom tower,

railways, forklift, and air condition contributes 38% in the revenue of Exide Industries. This is

likely to grow at an explosive rate on the back of the rapid growth in rural and semi urban

areas and sustained power deficit that boost the demand of inverters in hospitals, hotels,

beauty parlor and in other office premises. In railways, these batteries are used for signaling,

lighting of coach. Indian railways is planning to add 25,000 kms of new lines by 2020. All of

these are likely to improve top line growth of Exide.

Company Benefit

Shine‐Kobe Electric Machinery Co Ltd For Technical Assistance of Automotive & VRLA batteries

Furukawa Battery Co Ltd For Idling Stop System Automotive Batteries

Changxing Noble Power Sourcing Co Ltd Manufacture of Deep Cycling E‐bike batteries for electric bicycles & scooters

Thunder Sky Battery Ltd Sourcing & Technical support of lithium ion batteries

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Exhibit 13. Application of different Batteries in different sectors


Backward Integration along with capacity addition improve margins

The key raw material for Exide is lead which is 80% of the total raw materials. According to

the Bloomberg data, now lead is ruling around $2550 a ton and it ranged between $851 per

ton to $3890.15 per ton during the time span of 2006 to 2011. So to reduce the volatility of

earning, Exide acquired 100% stake in Chloride Metals in 2007 and 51% stake in Leadage

Alloys India in 2008 which is increased to 100% in 2010. Through these acquisitions, the

company not only reduces dependency on imported lead, save import duty around 5% but also

get price advantage which is 8% to 10% cheaper than imported lead which leads to improve

EBITDA margin. Recently 45% of lead requirement is coming from these two smelters which

are likely to be increased to 70% by FY 2013. To increase the lead consumption from the

acquired smelters, Exide is planning to increase the overall capacity from 96,000 MTPA to

140,000 MTPA by FY 2012.

Exhibit 14. Price Trend of Lead (In $)

Source: Bloomberg, Microsec Research

Revenue Mix(%) Segment Clients Products Application

61 Auto Tata Motors, M&M,

Hero Honda, Hyundai,

Toyoya,,General Motors,

Maruti

Traction batteries To power the starter motor, lights

& ignition system of a vehicle's

engine

27.7 Power American Power

Corporation,NTPC

Flooded flat pasted, flooded

tabular & value regulated lead

acid batteries

Power back up system in

offices,malls,power stations

8 Telecom GTL infrastructure Tabular batteries, VRLA Telecom tower base station

0.4 Railways Indian railways VRLA Signalling, coach& track lighting

2.9 Others Godrej,Mcnell,Voltas,Ma

lnl,Indian Navy,Admiralty

Shipyard Russia,

Motorola

Flooded plante & tubuler

batteries

Mainly for back up

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Peer Group

Exhibit 15. Peers Group (In `Mn)

Source: Bloomberg, Company Data, Microsec Research; TTM

Key Management Profile

Particulars(` Mn) Exide Amara Raja HBL Power

Revenues 43,555.50 16,950.04 10,228.80

Growth (%) 22.20% 24.26% ‐6.47%

EBITDA 8,863.10 2,487.43 840.60

EBITDA Margins (%) 20.35% 14.68% 8.22%

Net Profit 6,372.30 1,436.80 175.00

Net Profit Margins (%) 14.63% 8.48% 1.71%

Growth (%) 35.31% ‐9.28% ‐82.37%

EPS 7.57 16.82 (0.15)

BVPS 28.58 75.83 21.32

P/E 22.03 11.37 (177.67)

P/BV 5.84 2.52 1.25

RoE 26.23% 22.18% 3.24%

EV/EBITDA 11.82 6.58 11.50

Mr R G Kapadia Chairman &

Non

Executive

Director

CA & expert on Taxation &

Accountancy & served as the

President of the Indian

Merchants Chamber for

2005-06

Directorships in Asianet Satellite

Communications, EIH Associated Hotels, FIL

Trustee, Goldiam international, Goldiam

Jewellery, ING Vysya Life Insurance, Nilkamal,

Prism Cement, Raheja QBE General Insurance,

Surin Investments

Mr S B Raheja Vice

Chairman &

Non

Executive

Director

Bachelor's degree in

Business Administration

with 25 years of experience

in business management

Directorships in Prism Cement, Supreme

Petrochem, ING Vysya Life

Mr H M Kothari Non

Executive

Director

Leading Investment banker

with 40 years of exp & was

associated with DSP Merill

Lynch

Presently Chairman of DSP Black Rock

investment Managers & directorships in Alkyl

Amines Chemicals, Kirloskar Engines, Food

World Super Markets, Health & Glow

Retailing, Shuko Real Estate, Arko Dealers,

Arko Enterprises, Bestow Contractors &

Developers, Hemko Patents Development, MVL

Reality

Mr T V RamanathaMD & Chief

Executive

Officer

CA & CS with 41 years of

exp of which 5 years was

with World Bank & was

associated with United

Breweries Group as Group

Vice President Finance

Directorship in Chloride International,

Chloride Metals, Leadage Alloys India

Ms Mona N Desai Non

Executive

Director

Graduate in Psychology &

holds a Law Degree from

Govt Law Degree

Member of the Bombay Incorporated Law

Society & Ethics Committee of Kokilaben D

Ambani Hospital

Board Of Directors

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Valuation

We adopted Discounted Cash Flow (DCF) methodology to value the stock of Exide Industries.

By using Capital Asset Pricing Model (CAPM), the company’s cost of equity stood at 11.12%

with the value of 8% Risk Free Rate, 4.11% Market Risk Premium and Beta of 0.76x. For debt,

we assigned post tax cost of 6.09%. Coupled with these costs and debt to Equity ratio of 0.12x,

we arrived at WACC of 10.57%. Furthermore, we assumed a terminal growth rate of 2.5% for

the stock post FY2015. With these, we arrived at a target price of `174 which translates

24.58% upside over its current stock price of `140.05. The sensitivity of our target price

towards various levels of WACC and terminal growth rate is described as follows:

Exhibit 16. Exide – Sensitivity Analysis

Source: Company, Microsec Research

Risks

Exide is looking good for long term investment due to huge demand of its products from

different segments, expected capacity expansion in both lead smelters and manufacturing

plants. However, occurrence of factors such as competition from unorganized players, slow

down in the targeted business sectors due to increasing interest rate, fuel price may negatively

affect Exide’s performance.

1.50% 2% 2.50% 3% 3.50%

8.57% 200.43 212.93 227.49 244.67 265.23

9.57% 177.24 186.57 197.22 209.50 223.79

WACC 10.57% 159.18 166.38 174.48 183.64 194.10

11.57% 144.72 150.43 156.76 163.84 171.79

12.57% 132.90 137.51 142.59 148.19 154.42

Terminal Growth

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Financials

Income Statement (In `Mn) FY2008 FY2009 FY2010 FY2011E FY2012E FY2013E

Revenue 29,798.30 34,048.70 39,788.60 45,165.59 54,503.40 60,001.94

Manufacturing Exp 19,504.60 21,320.30 21,836.80 26,503.03 30,479.21 31,990.91

Gross Profit 10,293.70 12,728.40 17,951.80 18,662.55 24,024.19 28,011.03

Employees Cost 1,718.30 2,010.80 2,612.40 3,092.02 3,829.17 5,924.24

Other Expenditure 3,705.70 4,715.90 5,567.60 6,184.04 7,900.01 8,393.94

EBITDA 4,869.70 6,001.70 9,771.80 9,386.49 12,295.01 13,692.85

Dep 640.60 719.60 875.30 880.38 1,062.34 1,080.17

EBIT 4,229.10 5,282.10 8,896.50 8,506.11 11,232.67 12,612.69

Interest 410.50 587.40 161.00 105.65 457.80 566.09

Other Income 79.20 58.70 81.80 694.30 267.36 236.97

PBT 3,897.80 4,753.40 8,817.30 9,094.76 11,042.24 12,283.57

Tax 1,281.60 1,578.90 3,008.50 2,816.85 2,490.29 2,145.26

PAT 2,616.20 3,174.50 5,808.80 6,277.91 8,551.95 10,138.31

Min Int & Loss of Asso. Com 973.20 1,029.00 873.60 660.06 1,009.45 1,777.27

Net Profit 1,643.00 2,145.50 4,935.20 5,617.84 7,542.50 8,361.03

Basic & Diluted EPS 2.16 2.39 6.15 6.61 8.87 9.84

Balance Sheet (In `Mn) FY2008 FY2009 FY2010 FY2011E FY2012E FY2013E

Share Capital 800.00 800.00 850.00 850.00 850.00 850.00

Reserves & Surplus 7,666.30 9,128.90 18,315.00 24,592.91 33,144.85 43,283.16

Shareholders' Funds 8,466.30 9,928.90 19,165.00 25,442.91 33,994.85 44,133.16

Secured 2,959.30 2,207.70 816.00 2,616.00 4,466.00 4,466.00

Unsecured 801.30 1,402.70 925.30 925.30 925.30 925.30

Loan Funds 3,760.60 3,610.40 1,741.30 3,541.30 5,391.30 5,391.30

Minority Interest 80.50 178.30 366.20 366.20 366.20 366.20

Deferred Tax Liability(Net) 496.00 434.90 606.20 606.20 606.20 606.20

SOURCES OF FUNDS 12,803.40 14,152.50 21,878.70 29,956.61 40,358.55 50,496.86

Gross Block 11,778.80 13,917.80 14,873.10 16,673.10 18,523.10 19,173.10

Accumulated Dep/ Amor 5,661.70 6,181.40 6,935.20 7,815.58 8,877.92 9,958.09

Net Block 6,117.10 7,736.40 7,937.90 8,857.52 9,645.18 9,215.01

Capital Work in Progress incl Capital Adv 471.40 197.70 429.30 429.30 429.30 429.30

Fixed Assets 6,588.50 7,934.10 8,367.20 9,286.82 10,074.48 9,644.31

Investments 2,562.00 2,759.30 8,767.90 11,291.40 10,900.68 9,000.29

Deferred Tax Asset 2.10 3.10 3.00 3.00 3.00 3.00

Inventories 6,403.80 5,242.40 7,968.60 8,043.12 10,301.80 10,388.71

Sundry Debtors 2,917.70 2,657.40 2,980.50 3,454.16 4,125.53 4,565.27

Cash & Bank Balances 76.70 389.60 301.40 4,802.50 13,576.77 25,646.93

Loans & Advances 467.50 470.50 856.20 798.01 1,067.92 1,117.90

Current Assets, Loans & Advances 9,865.70 8,759.90 12,106.70 17,097.80 29,072.02 41,718.81

Current Liabilities & Provisions 6,214.90 5,303.90 7,366.10 7,722.41 9,691.62 9,869.56

Net Current Assets 3,650.80 3,456.00 4,740.60 9,375.39 19,380.40 31,849.26

APPLICATION OF FUNDS 12,803.40 14,152.50 21,878.70 29,956.61 40,358.55 50,496.86

Cash Flow Statement (In `Mn) FY2008 FY2009 FY2010 FY2011E FY2012E FY2013E

Net Profit Before Tax 3898.5 4522.8 8817.2 8700.89156 10511.1322 11624.0502

Net Cash Flow from Operating Activities 1,782.50 5,005.10 5,340.80 7,129.96 8,318.10 10,698.13

Net Cash Flow from Investing Activities (2,925.80) (3,240.50) (7,939.80) (4,075.03) (1,501.53) 1,158.10

Net Cash Flow from Financing Activities 1,168.80 (1,472.90) 2,482.90 1,694.35 1,392.20 (566.09)

Net Change In Cash 25.50 291.70 (116.10) 4,749.27 8,208.78 11,290.14

Opening Balance 37.90 76.70 389.60 301.40 5,050.67 13,259.45

Closing Balance 76.70 389.60 301.40 5,050.67 13,259.45 24,549.60

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Microsec Research: Phone No.: 91 33 30512100 Email: [email protected]

Ajay Jaiswal: President, Investment Strategies, Head of Research: [email protected]

Fundamental Research

Name Sectors Designation Email ID

Nitin Prakash Daga IT, Telecom & Entertainment AVP-Research [email protected]

Naveen Vyas Midcaps, Market Strategies AVP-Research [email protected]

Nitesh Goenka BFSI, Metal & Mining Sr. Research Analyst [email protected]

Abhisek Sasmal BFSI Research Analyst [email protected]

Sutapa Roy Economy Research Analyst [email protected]

Gargi Deb Agriculture & Pharma Executive Research [email protected]

Technical & Derivative Research

Vinit Pagaria Derivatives & Technical VP [email protected]

Ranajit Saha` Technical Research Sr. Manager [email protected]

Institutional Desk

Rajiv Lilaramani Institutional Equities Sr. Manager [email protected]

Dhruva Mittal Institutional Equities Manager [email protected]

PMS Division

Siddharth Sedani PMS Research AVP [email protected]

Sarmistha Rudra PMS Technical Research Analyst [email protected]

Research: Financial Planning Division

Shrivardhan Kedia FPD Products Manager Research [email protected]

Research-Support

Subhabrata Boral Research Support Executive [email protected]

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