styrolution, 2q cy 2013

7/27/2019 Styrolution, 2Q CY 2013

1/14

Please refer to important disclosures at the end of this report 1

Y/E Dec. (` cr) 2QCY13 1QCY13 % chg (qoq) 2QCY12 % chg (yoy)Total operating income 230 242 (4.9) 236 (2.4)EBITDA 14.5 23 (38) 14.4 0.8

EBITDA Margin (%) 6.3 9.7 (337)bp 6.1 20bp

Adj. PAT 8 15 (45) 10 (15)Source: Company, Angel Research

Styrolution ABS Ltd. (Styrolution) reported mixed set of numbers for 2QCY2013.

Top line for the quarter came in flat at `230cr, lower by 2.4% yoy as compared to

our estimate of `268cr. EBITDA grew marginally by 0.8% yoy and came in at

`15cr, while margins expanded by 20bp yoy to 6.3% owing to lower raw material

cost as percentage of sales. However, due to sharp depreciation in the currency

during the quarter, EBITDA margin has eroded by 337bp sequentially. Net profit

plunged by 14.7% yoy to `8.3cr on account of lower other income (by 7.0% yoy)

and higher tax outgo (39.5% of PBT as compared to 29.3% in 2QCY2012).

Despite short term concerns, persisting short supply to ensure growthThe prevailing slowdown in the Indian economy has fenced the growth in varied

user industries (like automobile and consumer durables) catered to by Styrolution,

subsequently, restricting its top-line growth. Moreover, Styrolution has its 80% of

the raw material imported which constitute ~74% of the net sales. Considering

the sharp currency depreciation during the quarter, sustaining operational

margins is of great concern. However, ABSs long persisting domestic demand

supply gap coupled with stable currency (owing to the initiatives undertaken by

the government) provides sufficient growth visibility for Styrolution.

Outlook and valuation: We expect Styrolutions revenue to post a CAGR of 5.8%over CY2012-14E to `1,108cr in CY2014E. The EBITDA is expected to be under

pressure owing to currency depreciation as ~80% of the raw material is imported.

The EBITDA and net profit are expected to dip by 0.5% and 1.3% over CY2012-

14E to `96cr and `62cr, respectively in CY2014E. We have revised our estimatesdownwards but continue to maintain Buy rating on the stock with the revisedtarget price of `492, based on target PE of 14x for CY2014E. Key financials (Standalone)

Y/E Dec. (` cr) CY2010 CY2011 CY2012 CY2013E CY2014ENet sales 742 826 989 1,007 1,108% chg 32.8 11.3 19.8 1.8 10.0

Adj. net profit 70 54 63 53 62% chg 43.0 (22.9) 17.4 (15.9) 15.9

OPM (%) 15.2 10.0 9.9 8.4 8.7EPS (`) 39.8 30.7 36.1 30.3 35.1

P/E (x) 10.5 13.7 11.6 13.8 11.9

P/BV (x) 2.2 1.9 1.7 1.5 1.4

RoE (%) 23.1 15.1 15.6 11.6 12.2

RoCE (%) 51.7 18.6 18.4 14.9 16.4

EV/Sales (x) 0.8 0.9 0.8 0.7 0.6

EV/EBITDA (x) 5.2 8.5 7.7 8.6 7.3

Source: Company, Angel Research; Note: CMP as of July 26, 2013

BUYCMP `419

Target Price `492

Investment Period 12 Months

Stock Info

Sector

Net Debt (`cr)

Bloomberg Code

Shareholding Pattern (%)

Promoters 75.0

MF / Banks / Indian Fls 9.1

FII / NRIs / OCBs 80.4

Indian Public / Others 10.5

Abs.(%) 3m 1yr 3yr

Sensex 2.4 17.2 9.6

STYR (16.4) (38.1) 3.5

52 Week High / Low 800/351

Petrochemicals

Market Cap (`cr) 735

Beta 0.7

18

Avg. Daily Volume 7,267

Face Value (`) 10

BSE Sensex 19,748

Nifty 5,886

Reuters Code STYR.BO

STAL IN

Twinkle GosarTel: 022- 3935 7800 Ext: [email protected]

Styrolution ABS (India)Performance Highlights

2QCY2013 Result Update | Petrochemicals

July 29, 2013


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Styrolution ABS | 2QCY2013 Result Update

July 29, 2013 2

Exhibit 1:2QCY2013 performance (Standalone)

Y/E Dec. (` cr) 2QCY13 1QCY13 % chg (qoq) 2QCY12 % chg (yoy) 1HCY2013 1HCY2012 % chgTotal operating income 230.2 242.1 (4.9) 235.9 (2.4) 472.2 471.7 0.1Net raw material 175.0 179.3 (2.4) 188.6 (7.2) 354.3 368.1 (3.7)(% of Sales) 76.0 74.1 80.0 75.0 78.0

Employee cost 7.6 7.2 5.6 6.8 11.2 14.8 13.5 9.4

(% of Sales) 3.3 3.0 2.9 3.1 2.9

Other Expenses 33.1 32.1 2.9 26.1 26.9 65.2 52.9 23.3

(% of Sales) 14.4 13.3 11.0 13.8 11.2

Total expenditure 215.7 218.6 (1.4) 221.5 (2.6) 434.3 434.5 (0.0)EBITDA 14.5 23.4 (38.0) 14.4 0.8 37.9 37.2 1.9EBITDA Margin (%) 6.3 9.7 (337)bp 6.1 20bp 8.0 7.9 14bp

Interest 0.0 0.0 0.0 0.0 0.0 0.0 0.0 -

Depreciation 3.3 3.2 0.6 3.3 (1.0) 6.5 6.6 (0.9)

Other income 2.5 2.2 15.5 2.7 (7.0) 4.7 7.0 (31.9)

PBT 13.8 22.4 (38.3) 13.8 (0.3) 36.2 37.6 (3.8)(% of Sales) 6.0 9.2 5.9 7.7 8.0

Tax 5.5 7.3 (25.3) 4.1 34.6 12.8 11.8 8.5

(% of PBT) 39.5 32.6 29.3 35.2 31.2

Adjusted PAT 8.3 15.1 (44.6) 9.8 (14.7) 23.4 25.9 (9.4)PATM (%) 3.6 6.2 4.1 5.0 5.5

Source: Company, Angel Research

For 2QCY2013, top line came in flat at `230cr, lower by 2.4% yoy as compared

to our estimate of `268cr. EBITDA grew marginally by 0.8% yoy and came in at`15cr, while margins expanded by 20bp yoy to 6.3% owing to lower raw material

cost as percentage of sales. The company was able to pass on the additional

imported raw material cost due to currency volatility to the customers and thereby

sustain the operational margins. However, due to sharp depreciation in the

currency during the quarter (average `54.2/USD in 1QCY2013 to `56.6/USD in

2QCY2013), sequentially EBITDA margin has eroded by 337bp. Net profit

plunged by 14.7% yoy to `8.3cr on account of lower other income (by 7.0% yoy)

and higher tax outgo (39.5% of PBT as compared to 29.3% in 2QCY2012).

Exhibit 2:Sluggish user industry impacts companys growth

Source: Company

Exhibit 3:Depreciating currency erodes the margin

Source: Company

206

208

211

236

236

263

255

242

230

14.7 12.2 (0.2)

17.3 14.4

26.5

20.72.6 (2.4)

(5)

0

5

10

15

20

25

30

0

50

100

150

200

250

300

2QCY11

3QCY11

4QCY11

1QCY12

2QCY12

3QCY12

4QCY12

1QCY13

2QCY13

(%)

(`cr)

Revenue ( LHS) Revenue growth (RHS)

24

12

13

23

14

33

24

23

15

11.8

6.0 6.4

9.7

6.1

12.7

9.39.7

6.3

0

3

6

9

12

15

0

10

20

30

40

2QCY11

3QCY11

4QCY11

1QCY12

2QCY12

3QCY12

4QCY12

1QCY13

2QCY13

(%)

(`cr)

EBIT DA (LH S) EBITD A Margin (RH S)


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July 29, 2013 3

Investment arguments

Despite short term concerns, persisting short supply to ensure growth

The current slowdown in the economy has fenced the growth in the user industrieslike automobile sector and consumer durables sector which account to ~60% of

the ABS industry demand. Subsequently, the top-line growth for the company has

remained flat over last few quarters. Styrolution expects automobile industry to

operate at 70-75% utilisation level while consumer durables at 65-70% at steady

growth. However, with revival in the economy leading to growth in varied

industries is expected to provide traction to the ABS volumes and thereby drive the

performance of the company upwards.

Exhibit 4:GDP growth dip mirroring economy slowdown

Source: CSO

Exhibit 5:Application industry composition

Source: Company

The gap between domestic demand for ABS vis-a-vis supply has persisted for long

and the same still continues to exist. The unfulfilled demand is being met by

imports. CRISIL Research estimates that the supply of ABS would grow at 17%

CAGR in order to meet the demand growth of 10% CAGR during CY2010-15E.

Exhibit 6:Unfulfilled domestic demand owing to demand supply gap

Source: Company

Styrolutions expansion of ABS capacity by 20,000TPA to 80,000TPA in 2011 has

enabled to tap the unfulfilled demand in the industry. Assuming the market share

of Styrolution to remain constant at 60%, volumes for ABS are likely to grow by

~12% over this period.

11.4

9.5

8.69.2

9.9

7.5

6.56.0

5.1 5.4 5.24.7 4.8

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

11.0

12.0

Mar-10

Jun-1

0

Sep-1

0

Dec-1

0

Mar-11

Jun-1

1

Sep-1

1

Dec-1

1

Mar-12

Jun-1

2

Sep-1

2

Dec-1

2

Mar-13

(%)

GDP yoy growth (%)

HomeAppliances

30%

Automobiles

28%Telecom

5%

Electrical&electronics

7%

Business machineofficeautomation

8%

Luggage &bus body

4%

Stationary/helmet9%

Textiles

3%

Others

6%

0

20

40

60

80

100

120

140

160

180

CY2008 CY2009 CY2010 CY2011 CY2012 CY2013E CY2014E

('000TPA

)

ABS Production ABS import ABS demand


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July 29, 2013 4

Stable currency to aid sustain margins

Rupee depreciation has hit the operational margins of the company since ~80% of

the raw material is been imported (74% of net sales). However, initiatives by the

government in order to boost the economy are expected to lead to stabilise the

currency thereby improving the profitability front of the company.

Exhibit 7:Depreciating rupee

Source: Company

We have expected the depreciation in rupee to be 5% over CY2013-14E after

considering inflationary change in the prices (USD). Consequently, EBITDA margin

is expected to be at 8.7%. However, more than expected downward movement of

currency would dent the margins further.

Exhibit 8:Raw material price details

Particulars Acrylonitrile Butadiene StyreneAverage INR prices (CY2013) 120,365 94,664 91,145

Increase in USD prices (%) 1.8 1.1 2.2

Change in Rupee (%) 5 5 5

Average INR prices (CY2014) 128,658 100,511 97,760

Source: Bloomberg, Angel Research

Exhibit 9: Sensitivity analysis

Change in Rupee (%) EBITDA margin (%) Adjusted PAT (`)(5) 15.3 111

(3) 14.0 102

0 12.0 87

3 10.0 72

5 8.7 628 6.7 47

Source: Angel Research

40

45

50

55

60

65

Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13

(`)


5/14


July 29, 2013 5

Tailor-made products as per market and consumer demand

Considering the rising demand for polymers in varied industries, Styrolution has

been consistently expanding its capacity and simultaneously co-polymerising ABS

ie, changing polymer composition and blending. The company has come up withmany tailor made products taking advantage of ABS flexibility of composition and

structure, which allows its use in diverse applications.

Exhibit 10:Product development

Product Development End use- productBlend of ABS/PMMA LCD TV market

Low gloss ABS Bus roof and automotive body interior

Nylon/ABS blend Indian automotive markets

ESCR grade Extrusion grade ABS Refrigerator application

Glass filled ABS AC blower application

Source: Company


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July 29, 2013 6

Financials

Exhibit 11: Key assumptions

Particulars (%) CY2013E CY2014ETotal Volume Growth 1.8 3.8

Total Realisation Growth 1.8 10.0

Weighted Change in RM 2.0 6.8

Source: Angel Research

CRISIL Research has estimated the supply of ABS to grow at a 17% CAGR during

CY2010-15E. Considering the current slowdown in the economy, we have

assumed the total volume to grow at 1.8% yoy and 3.8% yoy in CY2013E and

CY2014E, respectively.

Exhibit 12: Change in estimates

Y/E Dec. Earlier estimates Revised estimates % changeCY2013E CY2014E CY2013E CY2014E CY2013E CY2014ENet Sales (` cr) 1,068 1,223 1,007 1,108 (5.7) (9.4)EBITDA Margin (%) 9.6 9.6 8.4 8.7 (126)bp (90)bp

EPS (`) 38 44 30 35 (20.4) (20.3)Source: Angel Research

Net sales growth to be sluggish at 5.8% over CY2012-14E

Mirroring the slowdown in growth in automobile and home appliances sectors, the

demand for ABS is expected to be stagnant. Hence, we expect top-line to grow at

1.8% in CY2013E. However, with initiatives in policy reforms undertaken by

government to boost economy, the growth in CY2014E is expected to improve to

10.0% yoy with net-sales at `1,108cr in CY2014E.

Exhibit 13: Net-sales growth on a roller coaster ride


559

742

826

989

1,0

07

1,1

08

(7.4)

32.811.3

19.8 1.8

10.0

(10)

(5)

0

5

10

15

20

25

30

35

0

200

400

600

800

1000

1200

CY2009 CY2010 CY2011 CY2012E CY2013E CY2014E

(%)

(`

cr)

Net Sales (LHS) Net Sales growth (RHS)


7/14


July 29, 2013 7

On the back of lower availability of imported raw materials and volatile currency

movements (increasing feedstock prices), raw-material prices are assumed to

grow, which would be partially be passed on to the consumers by price hikes.

EBITDA, on the back of flat top-line growth is expected to dip from`

98cr inCY2012 to `96cr in CY2014E. The EBITDA margin too is expected to remain

under pressure and dip to 8.4% and 8.7% in CY2013E and CY2014E respectively.

PAT too is expected to dip by 1.3% CAGR over CY2012-14E to `62cr in CY2014E.

Exhibit 14: EBITDA margin under pressure


Exhibit 15: PAT margin to normalise


86 113 82 98 84 96

15.4

15.2

10.0

9.9

8.4

8.7

0

3

6

9

12

15

18

0

20

40

60

80

100

120


(%)

(`

cr)

EBITDA (LHS) EBITDA margin (RHS)

49 70 54 63 53 62

8.8

9.4

6.5

6.4

5.3

5.6

0

1

2

34

5

6

7

8

9

10

0

10

20

30

40

50

60

70

80


(%)

(`cr)

PAT (LHS) PAT margin (RHS)


8/14


July 29, 2013 8

Risks

Raw-material supply and price volatility

Acrylonitrile, butadiene and styrene are the key raw materials for production ofABS and SAN. About 81% of the total raw-materials used for production are

imported. Supply of these raw materials is quite tight and inflexible. Moreover,

their prices have been fluctuating in a wide range, which in turn is likely to

negatively affect the companys margins. On the back of high feedstock prices,

prices for ABS are also expected to rise.

Exhibit 16: Butadiene and Styrene price trend

Source: Bloomberg

Exhibit 17: Acrylonitrile price trend

Source: Bloomberg

Exchange rate fluctuationsRaw materials form nearly 80% of the total operating cost. 81% of the raw

materials are imported. The exchange rate fluctuation can have an adverse effect

on cost and, thereby the margins, so is a risk factor.

Competition

In the domestic duopolistic market, Styrolution holds 60% market share in ABS

resins segment and 68% in SAN resins segment, while the remaining is held by

Bhansali Engg Ltd.

Exhibit 18: Relative Valuation

Y/E (TTM) Net Sales(`cr) OPM(%) PAT(`cr) EPS(`) RoE(%) P/E(x) P/BV(x) EV/ Sales(x)Styrolution* 990 9.6 60 34.4 13.2 12.2 1.6 0.7

Bhansali engg^ 420 3.8 1 0.1 0.6 279.1 1.6 0.8

BASF India^ 3,945 6.2 121 27.8 10.5 19.2 2.0 0.7

Source: Company, Capital Line, *TTM ended Jun13 quarter, ^TTM ended Mar13 quarter

0

5

10

15

20

25

30

35

40

45

50

0

10

20

30

40

5060

70

80

90

Jan-1

0

Jul-10

Jan-1

1

Jul-11

Jan-1

2

Jul-12

Jan-1

3

Jul-13

(`/pound)

Butadine LHS St rene RHS

75

85

95

105

115

125

135

145

155

Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13

('000`/MT)


9/14


July 29, 2013 9

Outlook and Valuation

We expect Styrolutions revenue to post a CAGR of 5.8% over CY2012-14E to

`1,108cr in CY2014E owing to short term concerns over economic slowdown. The

EBITDA and net profit are expected to dip by 0.5% and 1.3% over CY2012-14E to

`96cr and `62cr, respectively in CY2014E. With recent correction in the stock price

owing to OFS, Styrolution is available at an attractive valuation of 11.9x PE and

EV/Sales of 0.6x for CY2014E. We have revised our estimates downwards butcontinue to maintain Buy rating on the stock with the revised target price of `492,based on target PE of 14x for CY2014E.Exhibit 19: One year forward PE


Company Background

Styrolution (name changed from INEOS ABS India Ltd. effective from

March 1, 2012) is a leading manufacturer of an engineering plastic namely

styrene monomer, polystyrene and ABS. The company is a 50/50 joint venture

between BASF and INEOS ABS formed by combining the styrenic business of two

of the largest global chemical companies. In the domestic market, Styrolution is the

market leader and holds 60% market share in ABS resins segment and 68% in

SAN resins segment.

Offer for Sale

The Promoter, Styrolution Jersey, also the parent company with 87.3% stake pre-

issue, sold 12.3% of the total paid up equity share capital of the company through

OFS in order to abide by the June 2010 amendment of Securities Contract Act

which mandates listed companies to have a minimum 25% of public shareholding

by June 2013. Styrolution had fixed the OFS floor price at `400 per share which

was subscribed by 2.4 times at indicative price of `422.

0

100

200

300

400

500

600

700

800

900

Jul-08

Jan-09

Jul-09

Jan-10

Jul-10

Jan-11

Jul-11

Jan-12

Jul-12

Jan-13

Jul-13

(`)

Price 2.5x 8.5x 14.5x 20.5x


10/14


July 29, 2013 10

Profit and Loss (Standalone)

Y/E December (` cr) CY2010 CY2011 CY2012 CY2013E CY2014EGross sales 816 911 1,107 1,126 1,239

Less: Excise duty 74 85 117 119 131Net Sales 742 826 989 1,007 1,108

Other operating income - - - - -Total operating income 742 826 989 1,007 1,108% chg 32.8 11.3 19.8 1.8 10.0

Net Raw Materials 522 620 745 766 844

% chg 44.8 18.8 20.2 2.8 10.2

Other Mfg costs 36 41 51 50 55

% chg 5.7 12.9 23.1 (0.5) 10.0

Personnel 20 26 28 28 31

% chg 16.2 26.3 6.8 1.8 10.8

Other 51 57 69 79 81

% chg (15.9) 11.8 20.8 14.0 3.0

Total Expenditure 629 744 892 923 1,012

EBITDA 113 82 98 84 96% chg 31.0 (27.1) 18.4 (13.5) 14.4

EBITDA Margin 15.2 10.0 9.9 8.4 8.7

Depreciation & Amortisation 14 14 14 15 16

EBIT 99 68 84 69 80% chg 38.0 (30.9) 22.7 (17.7) 16.4

(% of Net Sales) 13.3 8.3 8.5 6.9 7.3

Interest & other Charges 2 2 2 2 2

Other Income 5 11 11 11 12

(% of Net Sales) 0.7 1.3 1.1 1.1 1.1

Recurring PBT 97 67 82 67 78% chg 37.9 (31.3) 22.7 (18.1) 16.9

PBT (reported) 103 78 93 78 91Tax 33 24 30 25 29

(% of PBT) 31.8 30.3 32.1 32.1 32.1

PAT (reported) 70 54 63 53 62Extraordinary Expense/(Inc.) (0) (0) (0) - -ADJ. PAT 70 54 63 53 62% chg 43.0 (22.9) 17.4 (15.9) 15.9

(% of Net Sales) 9.4 6.5 6.4 5.3 5.6

Basic EPS (`) 39.8 30.7 36.1 30.3 35.1Fully Diluted EPS (`) 39.8 30.7 36.1 30.3 35.1% chg 43.0 (22.9) 17.4 (15.9) 15.9


11/14


July 29, 2013 11

Balance Sheet (Standalone)

Y/E December (` cr) CY2010 CY2011 CY2012 CY2013E CY2014ESOURCES OF FUNDSEquity Share Capital 18 18 18 18 18Preference Capital - - - - -

Reserves& Surplus 317 362 417 463 516

Shareholders Funds 334 380 435 480 534Minority Interest - - - - -Total Loans - 131 67 74 74

Deferred Tax Liability (Net) 21 18 17 17 17

Other long term liabilities - 0 0 0 0

Long term provisions - 15 15 15 15

Total Liabilities 356 543 534 586 639APPLICATION OF FUNDSGross Block 318 324 323 355 373

Less: Acc. Depreciation 181 195 199 214 230

Net Block 136 129 124 141 143Capital Work-in-Progress 12 11 29 35 39

Lease adjustment - - - - -

Goodwill - - - - -

Investments 93 101 17 22 29Long Term Loans and advances - 13 28 20 25

Current Assets 281 341 440 475 522

Cash 60 63 33 66 83

Loans & Advances 41 59 137 140 154

Inventory 71 95 95 94 91

Debtor 109 124 175 176 194

Current liabilities 166 51 104 107 118

Net Current Assets 115 290 336 368 404Mis. Exp. not written off - - - - -

Total Assets 356 543 534 586 639


12/14


July 29, 2013 12

Cash Flow (Standalone)

Y/E December (` cr) CY2010 CY2011 CY2012 CY2013E CY2014EProfit Before Tax 103 78 93 78 91

Depreciation 14 14 14 15 16Change in WC 16 (352) (77) 1 (19)

Other income (5) (11) (11) (11) (12)

Direct taxes paid (33) (24) (30) (25) (29)

Cash Flow from Operations 95 (294) (11) 59 46(Incr)/ Decr in Fixed Assets (8) (5) (17) (38) (21)

(Incr)/Decr In Investments (21) (21) 69 3 (12)

Other income 5 11 11 11 12

Cash Flow from Investing (24) (16) 63 (24) (21)Issue of Equity/Preference - - - - -

Incr/(Decr) in Debt (2) 142 (64) 7 -

Dividend Paid (Incl. Tax) (7) (7) (7) (8) (8)

Others (39) 179 (11) - -

Cash Flow from Financing (48) 314 (82) (1) (8)Incr/(Decr) In B/S Cash 22 4 (31) 33 17

Opening Cash balance 37 60 63 33 66Closing cash balance 60 63 33 66 83


13/14


July 29, 2013 13

Key Ratios (Standalone)

Y/E December CY2010 CY2011 CY2012 CY2013E CY2014EValuation Ratio (x)P/E (on FDEPS) 10.5 13.7 11.6 13.8 11.9

P/CEPS 8.8 10.9 9.6 10.8 9.5

P/BV 2.2 1.9 1.7 1.5 1.4

Dividend yield (%) 1.0 1.0 1.0 1.1 1.1

EV/Net sales 0.8 0.9 0.8 0.7 0.6

EV/EBITDA 5.2 8.5 7.7 8.6 7.3

EV / Total Assets 1.6 1.3 1.4 1.2 1.1

Per Share Data (`)EPS (Basic) 40 31 36 30 35

EPS (fully diluted) 40 31 36 30 35

Cash EPS 48 39 44 39 44DPS 4 4 4 4 4

Book Value 190 216 247 273 304

DuPont AnalysisEBIT margin 13.3 8.3 8.5 6.9 7.3

Tax retention ratio 0.7 0.7 0.7 0.7 0.7

Asset turnover (x) 3.9 2.2 2.2 2.2 2.3

ROIC (Post-tax) 35.3 12.9 12.5 10.1 11.2

Cost of Debt (Post Tax) - - - - -

Leverage (x) (0.5) (0.1) 0.0 (0.0) (0.1)

Operating ROE 19.2 11.8 13.0 9.8 10.4

Returns (%)ROCE (Pre-tax) 27.8 12.6 15.7 11.8 12.6

Angel ROIC (Pre-tax) 51.7 18.6 18.4 14.9 16.4

ROE 23.1 15.1 15.6 11.6 12.2

Turnover ratios (x)Asset TO (Gross Block) 2.3 2.5 3.1 2.8 3.0

Inventory / Net sales (days) 40 38 39 38 39

Receivables (days) 61 58 70 70 70

Payables (days) 110 27 46 61 45

WC cycle (ex-cash) (days) 27 100 112 109 106

Solvency ratios (x)Net debt to equity (0.5) (0.1) 0.0 (0.0) (0.1)

Net debt to EBITDA (1.3) (0.4) 0.2 (0.2) (0.4)

Int. Coverage (EBIT/ Int.) 55.0 42.5 42.8 - -


14/14


Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com

DISCLAIMERThis document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investmentdecision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document shouldmake such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of thecompanies referred to in this document (including the merits and risks involved), and should consult their own advisors to determinethe merits and risks of such an investment.

Angel Broking Pvt. Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, makeinvestment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in thisdocument are those of the analyst, and the company may or may not subscribe to all the views expressed within.

Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions andtrading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company'sfundamentals.

The information in this document has been printed on the basis of publicly available information, internal data and other reliablesources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as thisdocument is for general guidance only. Angel Broking Pvt. Limited or any of its affiliates/ group companies shall not be in any wayresponsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report.Angel Broking Pvt. Limited has not independently verified all the information contained within this document. Accordingly, we cannottestify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document.While Angel Broking Pvt. Limited endeavours to update on a reasonable basis the information discussed in this material, there may beregulatory, compliance, or other reasons that prevent us from doing so.

This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,redistributed or passed on, directly or indirectly.

Angel Broking Pvt. Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking

or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report orin the past.

Neither Angel Broking Pvt. Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise fromor in connection with the use of this information.

Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to thelatest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Pvt. Limited and its affiliates mayhave investment positions in the stocks recommended in this report.

Disclosure of Interest Statement Styrolution ABS

1. Analyst ownership of the stock No

2. Angel and its Group companies ownership of the stock No

3. Angel and its Group companies' Directors ownership of the stock No

4. Broking relationship with company covered No

Note: We have not considered any Exposure below `1 lakh for Angel, its Group companies and Directors.

Ratings (Returns): Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)Reduce (-5% to -15%) Sell (< -15%)

styrolution, 2q cy 2013

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