STRICTLY CONFIDENTIAL AMP 16 October 2014 ANTIQUE’S MORNING PRESENTATION Market Snapshot

Global Indices Closing % Chg % YTD FROM THE RESEARCH DESK Dow Jones 16,142 (1.1) (2.6) 2QFY15 RESULTS REVIEW NASDAQ 4,215 (0.3) 0.9 FTSE 6,212 (2.8) (8.0) Limited CAC 3,940 (3.6) (8.3) Defying slowdown yet again DAX 8,572 (2.9) (10.3) Cyient Limited Russia 1,067 (0.8) (26.0) Strong beat in performance; Acceleration to continue Bovespa 56,135 (3.2) 9.0 Nikkei 15,074 0.9 (9.8) Hang Seng 23,140 0.4 (0.7) Shanghai Composite 2,374 0.6 12.2

Global News Indian Indices Closing % Chg % YTD Sensex 26,349 (0.1) 24.5 „ U.S. stocks plunged on Wednesday in wake of disappointing U.S. retail sales and wholesale pricing data. The Census Bureau reported earlier that Nifty 7,864 (0.3) 24.7 U.S. retail sales fell 0.3% last month, exceeding forecasts for a 0.1% decline, MSCI 495 - 21.5 after expanding 0.6% in August. DJIA fell 1% to close at 16142, the S&P CNX Midcap 11,270 (0.1) 39.6 500 index fell 0.8% to close at 1862.5 BSE Smallcap 10,631 (0.1) 62.3 „ Tokyo stocks closed 0.92% higher on Wednesday, recovering slightly after five days of losses on bargain hunting and coutesy a weaker yen. Nikkei Flows (USDm) Prev. Day MTD which sank to a two-month low on Tuesday, gained 0.9% to finish at 15,073.5 FII (89) (325) Sector & Corporate News Locals 79 431

„ DLF, India's largest builder, which has been in the centre of a political storm Provisional flows (USDm) for its alleged dealings with Robert Vadra, has now received a body blow FIIs (113) from the capital market watchdog: Securities and Exchange Board of India. Locals 81 DLF, its Chairman KP Singh, some members of the promoter family, and a few senior executives have been barred from dealing in stocks and securities for Volumes USDbn % Chg three years by Sebit. The regulatory action stems from the DLF management's failure to disclose material information to investors during the firm's maiden Cash (NSE + BSE) 3.1 19.4 equity offer in 2007. F&O (net) 37.0 20.0 „ Economy: Prime Minister Narendra Modi has announced an interim assistance INR10bn for Andhra Pradesh, for undertaking relief and FII F&O Stock Fut Index Fut rehabilitation measures in the cyclone-affected areas of the state. The Eastern Net ($ mn) 15 (49) Power Distribution Company, which supplies power to Vizag and other areas, Open Int (%) 0.2 (3.7) alone is estimated to have incurred a loss of INR400bn. Over 6,000 transformers and 16,000 electric poles have been uprooted by heavy gales. ADR/GDR Gainers Last % Chg „ will invest USD4bn in the British Columbia province, 43.6 0.5 Canada, to source LNG from the region. The company in May had signed a SBI 82.2 0.2 deal to buy 10% stake in shale-gas assets and a linked LNG project in British Dr Reddy 48.0 0.2 Columbia. 12.2 0.2 Ranbaxy 9.6 0.1 „ Bhushan Steel: Alstom T&D India has received a contract worth INR1.4bn from Power Grid Corporation of India for supply of transformers and reactors ADR/GDR Losers Last % Chg to strengthen the southern grid. Under the contract, Alstom will supply six units Reliance 31.0 (0.6) of 400/200 kV, 500 MVA transformers and two units of 420 kV, 125 MVAr 64.2 (0.5) shunt reactors. ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 2

Sectoral indices Delivery Spike Closing % Chg % MTD % YTD Company Volume Spike (%) Chg (%) BSE Auto 17,261 (0.4) (2.7) 40.8 Adani 1,545,983 7749% (1.76) BSE Bank 18,027 0.5 2.3 38.6 DLF 27,023,891 653% (28.56) BSE Cap Goods 14,278 (0.0) 0.1 39.1 NMDC 2,228,191 349% (1.06) BSE Cons dur 9,521 (0.6) (3.3) 63.6 139,626 348% 2.69 BSE FMCG 7,300 (0.2) (4.3) 11.2 HDFC 1,471,651 165% (1.35) BSE IT 10,722 (0.8) 0.3 18.1 Union Bank 1,343,367 157% 2.63 BSE Health 13,577 0.1 (5.4) 36.2 2,174,417 153% 2.64 BSE Metal 11,090 0.1 (2.8) 11.3 PFC 1,189,378 115% 3.77 BSE Oil 10,707 (0.5) (0.2) 21.2 Mundra Port 1,472,225 96% (0.13) BSE Power 2,021 0.6 2.2 18.8 Kotak Bank 746,160 73% 0.46 BSE PSU 7,855 0.2 0.9 32.9 BSE Realty 1,419 (9.2) (10.2) (1.0) BSE TECK 5,917 (0.5) (0.0) 17.1

Derivatives Update Long Build Up Company Last % Chg % Chg OI OI (in 000) BHEL 225 3.4 2.4 36,306 UNIONBANK 211 2.2 3.4 10,016 INDUSINDBK 652 2.1 4.8 5,951 Nifty Outperformers GLENMARK 739 1.6 7.1 1,938 Short Build Up Price % Chg % MTD % YTD Company Last % Chg % Chg OI OI (in 000) Bharat Heavy Electricals 226 3.6 12.7 27.8 DLF 106 (28.5) 33.8 28,396 Bajaj Auto Ltd 2,412 2.7 2.6 26.2 HDIL 75 (5.4) 25.7 34,056 Axis Bank Ltd 397 2.6 5.1 52.8 IOC 369 (3.2) 4.1 5,179 Indusind Bank Ltd 650 2.3 4.5 54.4 INDIACEM 106 (2.9) 4.0 17,292 Co Ltd 87 2.1 4.7 (1.4) Ltd 398 1.7 (1.7) 20.6 Short Covering State 2,524 1.5 3.2 42.9 Company Last % Chg % Chg OI OI (in 000) LICHSGFIN 335 4.1 (3.4) 12,403 Nifty Underperformers SAIL 77 3.7 (4.7) 39,216

Price % Chg % MTD % YTD PFC 250 3.5 (4.6) 8,558 ORIENTBANK 242 3.1 (7.6) 6,456 Dlf Ltd 105 (28.6) (30.4) (37.0) Corp Ltd 656 (2.3) 0.1 88.6 Profit Booking Cairn India Ltd 284 (2.0) (8.9) (12.2) Company Last % Chg % Chg OI OI (in 000) Hcl Technologies Ltd 1,723 (1.9) 0.5 37.5 MOTHERSUMI 378 (2.1) (1.0) 5,312 Tata Motors Ltd 488 (1.7) (2.8) 29.6 NMDC 154 (1.5) (1.5) 11,668 Ltd 646 (1.5) 2.6 31.9 235 (1.4) (5.3) 7,606 Housing Development Finance 1,004 (1.4) (4.9) 26.4 EICHERMOT 11,243 (0.8) (4.4) 127

Bulk Deals

Date Security Name Client Name Buy/Sell Qty Price 14-Oct-14 RAINBOWPAP Mangal Keshav Capital Ltd BUY 2,148,213 77.50 14-Oct-14 RAINBOWPAP Bdr Securities Limited SELL 2,148,213 77.50 14-Oct-14 Dolphin Offshore Enterpri Jagartius Universal BUY 99,000 161.98 14-Oct-14 BITL Jackpot Vintrade Private Limited SELL 352,000 26.55 ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 3

Nifty Nifty P/E Nifty P/B

8200 24 4.0 22 7200 3.5 20

6200 18 3.0 16 5200 2.5 14

4200 12 2.0 O c t - 10 O c t - 11 O c t - 12 O c t - 13 O c t - 14 O c t - 10 O c t - 11 O c t - 12 O c t - 13 O c t - 14 O c t - 10 O c t - 11 O c t - 12 O c t - 13 O c t - 14

Source: Bloomberg Sensex FII Provisional Flows (INRcr) DII Provisional Flows (INRcr)

28000 4,000 1,500 26000 750 24000 2,000 22000 0 20000 0 y 18 0 0 0 -750 16 0 0 0 -2,000 -1,500 14 0 0 0 Oct-13 Feb-14 Jun-14 Oct-14 Oct-10 Oct-11 Oct-12 Oct-13 Oct-14 Oct-13 Feb-14 Jun-14 Oct-14

Source: Bloomberg

Economy, Money & Banking Commodities Update

Forex Rate Last % Chg % MTD % YTD Commodities Last % Chg % MTD % YTD INR~USD 61.4 (0.5) 0.5 0.6 Gold ($/Ounce) 1,244 0.1 2.9 3.1 INR~EUR 77.8 (0.3) (0.1) 9.3 Crude Oil ($/Bl) 81 (1.2) (11.3) (13.4) INR~GBP 97.8 0.2 2.2 4.4 Aluminium ($/t) 1,892 (1.5) (1.9) 7.8 Copper ($/t) 6,685 (2.5) (0.5) (9.4) Bond Market Last Chg (bps) MTD (bps) YTD (bps) Zinc ($/t) 2,273 (2.9) (0.4) 10.7 10 Year Bond 8.4 0 (11) (42) Lead ($/t) 1,997 (2.4) (4.5) (8.8) Interbank call 9.0 120 90 25 Nickel ($/t) 15,753 (3.2) (3.0) 13.9

INR/USD Gold and silver prices Crude prices

64 2000 60 110 50 63 15 0 0 40 62 10 0 10 0 0 30 61 20 500 60 10 90 59 0 0 58 Oct-10 Oct-11 Oct-12 Oct-13 Oct-14 80 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Gold (LHS) Silver (RHS) Oct-10 Oct-11 Oct-12 Oct-13 Oct-14

Source: Bloomberg Inflation vs 10 year yield Nifty premium/discount NSE volatility index (%)

10 60 52.8 15 9 50 8 14 7 40 31.3 29.8 26.9 27.1 6 30 13 5 20 4 12 3 10 Nov-12 Jun-13 Jan-14 Aug-14 0 11 Inf lat io n (%) 10 Yr Yield (%) 08-Oct 09-Oct 10-Oct 13-Oct 14-Oct 16-Sep 23-Sep 30-Sep 7-Oct 14-Oct

Source: Bloomberg ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 4

Current Reco : HOLD 2QFY15 RESULTS REVIEW Previous Reco : BUY CMP : INR2,727 Bajaj Finance Limited Target Price : INR2,890 Defying slowdown yet again Potential Return : 6% Bajaj Finance's strong 2QFY15 performance was driven by traction in the consumer and SME businesses, which witnessed 56% and 47% YoY disbursement growth, respectively. However, margins continued their southward journey, declining 90bps YoY, on account of increasing proportion of low-yielding SME segment. GNPAs increased 27bps sequentially to 1.41% Digant Haria on account of a slippage in a medium-sized infrastructure account. Earnings +91 22 4031 3422 growth at 18% YoY was marginally lower-than-expectations (Antique: 28%). [email protected] The company's fixed deposit mobilisation program continues to witnesses strong inflows. The target price discounts FY16e BV by 2.5x. Despite the weak macro outlook, Bajaj Finance has displayed strong customer acquisition and cross-sell capabilities. The increasing depth of its consumer and SME product portfolio, coupled with deepening geographic footprint, will enable 30% loan book CAGR over FY14-16e. Margins will likely stabilise ~10%, given the increasing proportion of new businesses that have Market data lower yields. Strong under-writing processes will ensure stable credit costs, Sensex : 26,349 while earnings CAGR at 24% over FY14-16e will drive RoAs of 3.1% and Sector : NBFC RoEs of 21% over that period. We upgrade our FY16e earnings by 11% on Market Cap (INRbn) : 136.8 Market Cap (USDbn) : 2.2 account of improved growth visibility. However, valuations at 2.4x FY16e BV O/S Shares (m) : 50.1 limit the upside and hence we downgrade the stock to Hold. 52-wk HI/LO (INR) : 2813/1251 Fruits of category extensions and geographic expansion start to accrue Avg Daily Vol ('000) : 32 Overall disbursement growth of 50% YoY was driven by traction in consumer and SME business. Bloomberg : BAF IN Despite de-growth in two and three-wheeler businesses, the consumer business witnessed 34% Source: Bloomberg AUM growth due to brisk volumes in air-conditioners, digital electronics, and lifestyle financing. Valuation Its rural business is witnessing better-than-expected growth rates. We expect benefits from category FY14 FY15e FY16e and geography expansion to result in 30% AUM CAGR over FY14-16e. EPS (INR) 144.5 177.9 224.9 PE (x) 18.9 15.3 12.1 Margin adjustments continue, asset quality healthy BVPS (INR) 802.2 955.5 1,155.8 Calculated margins declined 90bps YoY as beta adjustments to the portfolio continued. P/B (x) 3.4 2.9 2.4 Competition in the loans against property segment continues to be intense. Asset quality declined Source: Bloomberg as GNPAs increased 27bps sequentially to 1.41% on account of a slippage in a medium-sized Returns (%) infrastructure account. Adjusting for that, asset quality continues to remain healthy. 1m 3m 6m 12m Absolute 4 27 55 111 Earnings trajectory strong, valuations limit upside Relative 7 21 33 65 Source: Bloomberg Deepening product portfolio in the SME and consumer space, strong balance sheet management, stringent appraisal processes, and the lower risk profile of new businesses will Shareholding pattern ensure 30% AUM CAGR over FY14-16e and contain credit cost at 130bps over FY15-16e. Promoters : 62% Earnings CAGR of 24% will drive RoEs of 21%, despite RoA adjustments. However, the sharp FII : 12% run-up leaves little upside to our target price of INR2,890 per share. DII : 7% Others : 19% Key financials Source: Bloomberg Year-ended Mar 31 FY12 FY13 FY14 FY15e FY16e Price performance vs Nifty NII (INRm) 12,501 17,191 22,153 28,349 35,703 240 Net income (INRm) 4,064 5,913 7,190 8,850 11,188 200 % growth 64.6 45.5 21.6 23.1 26.4 160 EPS 98 119 146 178 225 120 BVPS 492 676 802 956 1,156 80 RoA 3.8 3.8 3.4 3.1 3.1 Oct-13 Feb-14 Jun-14 Oct-14 RoE 24.0 21.9 19.5 20.2 21.3 BAJAJ FIN NIFTY P/B 5.5 4.0 3.4 2.9 2.4

Source: Bloomberg Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 5

Takeaways from the management interaction On asset growth „ 2W and 3W disbursements declined 13% and 41%, respectively, on account of a slowdown in sales of original equipment manufacturers „ Assets under management in the consumer durable segment grew 37%, aided by a delayed summer, category extensions, and geographic network expansion „ Rural lending portfolio continues to perform better-than-expectations „ Margins in the LAP and home loan portfolios remains under pressure due to intense competition from banks On asset quality and margins „ GNPAs increased due to slippage in a medium-sized infrastructure account. The account was already a corporate debt restructuring case and slipped into GNPAs „ The management expects the infrastructure book to completely run-down by FY17 „ Intense competition in LAP segment will result in lower margins for FY15. The management expects margins to stabilise in FY16 Forward looking statements „ Will continue to invest heavily in developing SME channels: the relationship manager and the direct sales channels. As such, cost-to-income will continue to hover around current levels „ The management has decided to carve out a separate division for financing through the e-commerce channel. „ AUM growth at 30-35% will drive earnings growth of 18-20% for FY15. RoAs will settle ~3% for FY15 and beyond. Income statement INRm 2QFY15 2QFY14 % YoY 1QFY15 % QoQ Interest earned 11,703 8,742 11,801 Interest expended 5,445 3,821 4,996 Net interest income 6,258 4,921 27.2 6,805 (8.0) Other income 716 898 659 Total net income 6,974 5,819 7,463 Staff expenses 1,059 808 1,078 Other operating expenses 2,127 1,960 2,350 Operating cost to income 46 48 46 Operating cost to AUM 5 6 5 Operating profit 3,788 3,050 24.2 4,035 (6.1) Provision and contingencies 800 523 829 Provision for tax 1,016 857 1,092 Reported profit 1,972 1,670 18.0 2,114 (6.7)

Source: Company, Antique

Balance sheet growth INRm 2QFY15 2QFY14 % YoY 1QFY15 % QoQ Loans outstanding 267,510 189,821 40.9 256,420 4.3 Disbursements 78,160 51,990 50.3 92,660 (15.6) AUM 280,040 198,290 41.2 269,430 3.9

Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 6

AUM accretion continues to remain strong Consumer and SME remain the key growth drivers 300 280 100% 269 11.3 9.7 9.1 8.4 7.8 6.9 6.9 241 250 225 80% 198 192 48.3 48.7 50.0 51.9 53.4 53.3 53.5 200 175 60%

150 40%

100 20% 40.4 41.6 40.9 39.7 38.8 39.8 39.5 50 0% - 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15 Consumer SME Commercial 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15

Source: Company, Antique Source: Company, Antique

Margin trend reflects declining beta of Bajaj Finance's lending portfolio 13.0

12.5 12.5 12.2 12.0

11.5 11.2 11.0 11.0

10.5 10.5

10.0 9.9 9.5 9.6

9.0 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15

Source: Company, Antique

Asset quality declines on account of slippage in a medium-sized infrastructure account 1.6 90.0

1.4 80.0 1.2 70.0 60.0 1.0 50.0 0.8 40.0 0.6 30.0 0.4 20.0 0.2 10.0 - - 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15 GNPA NNPA Provisioning coverage (RHS)

Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 7

Financials

Profit and loss account (INRm) Growth ratios (%) Year-ended Mar 31 2012 2013 2014 2015e 2016e Year-ended Mar 31 2012 2013 2014 2015e 2016e Interest Earned 19,963 29,248 37,886 50,001 62,554 Net interest income 36.9 37.5 28.9 28.0 25.9 Interest Expended 7,462 12,057 15,732 21,652 26,851 Operating profit 31.7 39.2 28.1 24.2 26.0 Net Interest Income 12,501 17,191 22,153 28,349 35,703 Net profit 64.6 45.5 21.6 23.1 26.4 Other income 1,757 1,866 2,848 3,275 3,766 Loans 69.0 36.3 37.2 37.9 23.2 Total income 14,257 19,057 25,001 31,624 39,469 Operating Expenses 6,691 8,523 11,511 14,863 18,353 Valuation (x) Operating Profit 7,566 10,534 13,490 16,761 21,116 Year-ended Mar 31 2012 2013 2014 2015e 2016e Total Provision and Contingencies 1,544 1,818 2,578 3,552 4,418 P/E 27.7 23.0 18.9 15.3 12.1 Profit Before Tax (PBT) 6,022 8,716 10,912 13,209 16,698 P/BV 5.5 4.0 3.4 2.9 2.4 Taxes 1,958 2,803 3,722 4,359 5,510 Opex analysis Profit After Tax 4,064 5,913 7,190 8,850 11,188 Reported PAT 4,064 5,913 7,190 8,850 11,188 Year-ended Mar 31 2012 2013 2014 2015e 2016e Operating cost / income 46.9 44.7 46.0 47.0 46.5 Balance sheet (INRm) Operating cost / Assets 6.8 5.9 5.8 5.4 5.2 Year-ended Mar 31 2012 2013 2014 2015e 2016e Spread analysis (%) Equity Capital 413 498 498 498 498 Reserves & surplus 19,923 33,173 39,411 47,039 57,004 Year-ended Mar 31 2012 2013 2014 2015e 2016e Yield on advances 20.4 20.2 19.1 18.3 17.7 Networth 20,336 33,670 39,909 47,536 57,502 Cost of borrowings 8.8 10.3 9.6 9.5 9.3 Total Loan Funds 102,264 131,332 197,496 258,340 319,109 NIMs 12.5 11.7 10.8 10.2 10.0 Total liabilities 129,289 178,212 246,180 325,290 400,174 Loans Outstanding 122,831 167,436 229,710 316,750 390,078 RoA tree Investments 55 53 282 339 406 Year-ended Mar 31 2012 2013 2014 2015e 2016e Cash & Bank Balance 598 4,164 7,768 3,168 3,901 Interest earned 18.6 19.0 17.9 17.5 17.2 Fixed Assets 1,388 1,762 2,199 2,529 2,908 Interest expended 7.0 7.8 7.4 7.6 7.4 Deferred Tax Asset 692 904 1,392 1,600 1,840 Gross interest spread 11.7 11.2 10.4 9.9 9.8 Total assets 129,289 178,212 246,180 325,290 400,174 Other income 1.6 1.2 1.3 1.1 1.0 Per share data Total income 13.3 12.4 11.8 11.1 10.9 Year-ended Mar 31 2012 2013 2014 2015e 2016e Employee expenses 3.1 2.8 2.7 2.6 2.5 Other expenses 3.1 2.8 2.7 2.6 2.5 No. of shares 41.3 49.8 49.8 49.8 49.8 Operating income 7.1 6.9 6.4 5.9 5.8 BVPS 492.2 676.4 802.2 955.5 1,155.8 Provisions 1.4 1.2 1.2 1.2 1.2 EPS 98.4 118.8 144.5 177.9 224.9 Pre-tax earnings 5.6 5.7 5.1 4.6 4.6 DPS 10 12 15 18 21 Tax 1.8 2.0 2.0 1.5 1.5 Source: Company, Antique RoA 3.8 3.7 3.2 3.1 3.1 Leverage 6.3 5.7 5.8 6.5 6.9 RoE 24.0 21.1 18.2 20.2 21.3

Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 8

Current Reco : BUY 2QFY15 RESULTS REVIEW Previous Reco : BUY CMP : INR448 Cyient Limited Target Price : INR550 Strong beat in performance; Acceleration to continue Potential Return : 22% Cyient's 2QFY15 results surprised on both revenue and margin fronts. Revenues grew 6.6% QoQ to USD111m versus our estimate of 3.7% QoQ growth. There was broad-based growth across operating units. EBITDA margins expanded 197bps to 16.1% on account of strong volume growth; selling, general, and administrative expense (SG&A) optimisation; higher Sagar Lele utilisation; and favourable exchange impact. The management continues to +91 22 4031 3419 remain positive on performance going forward. It sees no signs of weakness, [email protected] and expects strong revenue growth in the coming quarters. Going forward, we see strong revenue growth for Cyient given: 1) Strength across operating units, especially aerospace and utilities; 2) Higher growth rates and gaining of scale in smaller verticals like semiconductor, medical, and electronics; 3) Robust demand from existing clients and new customer acquisition; and 4) Larger synergies resulting out of the Softential acquisition. We remain positive on margin expansion since the company has multiple levers in place: revenue growth acceleration, improvement in delivery efficiency, utilisation, offshoring, reduction of sub-contracting costs, and SG&A optimisation. Post Cyient's 2Q earnings, we have raised our earnings estimates Market data for FY15e and FY16e by 2% and 5%, respectively. The stock trades at 12x FY16e for a revenue and earnings CAGR of 20% and 29% over FY14-16e, respectively. Sensex : 26,349 We retain our Buy rating with a revised target price of INR550 per share. Sector : IT 2Q revenues higher-than-expectations Market Cap (INRbn) : 50.1 Market Cap (USDbn) : 0.8 Cyient announced a robust set of numbers for 2QFY15, with constant currency revenue growth of 7.4% QoQ. It reported revenues of USD111m (QoQ growth of 6.6%), which was higher O/S Shares (m) : 112.1 than our estimate. Revenues were broad-based across operating units. Though revenues 52-wk HI/LO (INR) : 485/215 from engineering grew 4% QoQ, the same for data transformation and network and operations Avg Daily Vol ('000) : 222 (DNO) grew 11% QoQ, led by growth in Softential. Excluding revenues from Softential, Bloomberg : CYL IN overall revenues grew 5.1% QoQ, which indicates significant business strength. On account Source: Bloomberg of high revenue growth continuation, improved demand environment, and strength in key clients, we expect a revenue CAGR of 20% over FY14-16e. Valuation Strong margin performance FY14 FY15e FY16e EPS (INR) 23.7 32.1 39.4 EBITDA margins expanded 197bps QoQ to 16.1%, higher than our estimate of a 143bps expansion. Margins expanded on account of strong volume growth, SG&A optimisation, PE 19.0 14.0 11.4 higher utilisation, and favourable exchange impact. There is scope to expand margins from P/BV 3.2 2.7 2.3 current levels, given improvement in delivery efficiency, utilisation, offshoring, reduction of EV/EBITDA 10.5 9.3 6.9 sub-contracting costs, and SG&A optimisation. The management is confident of 100-150bps Dividend Yield (%) 1.1 2.1 2.6 expansion in EBITDA margins over the next two quarters. Despite this, the management expects FY15e EBITDA margins to be lower than FY14 by ~100bps, at ~17.5%. However, Source: Bloomberg continued sequential improvement is likely to drive margin expansion through FY16e. We Returns (%) expect an EBITDA CAGR of 19% over FY14-16e. 1m 3m 6m 12m Valuations and outlook Absolute (1) 37 39 100 Post 2Q, we have raised our earnings estimates for FY15e and FY16e by 2% and 5%, Relative 2 30 20 56 respectively. We forecast 20% and 29% revenue and earnings CAGR over FY14-16e, Source: Bloomberg respectively. We forecast an EPS of INR32 and INR39 for FY15e and FY16e, respectively. We continue to value the stock at 14x FY16e and revise our target price to INR550 per share. Shareholding pattern Quarterly financials Promoters : 22% INRm 2QFY15 1QFY15 QoQ(%) 2QFY14 YoY(%) Antique Var(%) FII : 35% Revenues (USDm) 111 104 6.6 88 26.5 108 2.8 DII : 13% Revenues 6,724 6,217 8.2 5,493 22.4 6,528 3.0 Others : 30% Personnel costs 4,038 3,861 4.6 3,281 23.1 3,971 1.7 Source: Bloomberg Gross profit 2,686 2,356 14.0 2,212 21.4 2,557 5.0 Price performance vs Nifty Operating expenses 1,606 1,480 8.5 1,268 26.6 1,544 4.0 240 EBITDA 1,081 877 23.3 944 14.5 1,014 6.6 200 EBIT 900 704 27.9 762 18.2 832 8.2 160 Net profit 902 685 31.6 581 55.2 796 13.3 120 Margins 2QFY15 1QFY15 QoQ (bps) 2QFY14 YoY (bps) Antique Var (bps) 80 Gross 40.0 37.9 205 40.3 (32) 39.2 77 Oct-13 Feb-14 Jun-14 Oct-14 EBITDA 16.1 14.1 197 17.2 (111) 15.5 55 CYIENT NIFTY Net profit 13.4 11.0 239 10.6 283 12.2 122

Source: Bloomberg Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 9

Valuations The stock trades at 12x FY16e earnings. We forecast 29% earnings CAGR over FY14-16e. We value the stock at 14x FY16e earnings for a revised target price of INR550 per share.

Cyient - PE band 600

500

400

300

200

100

0 Jul-07 Jul-08 Jul-09 Jul-10 Jul-11 Jul-12 Jul-13 Jul-14 Oct-07 Jan-08 Oct-08 Jan-09 Oct-09 Jan-10 Oct-10 Jan-11 Oct-11 Jan-12 Oct-12 Jan-13 Oct-13 Jan-14 Oct-14 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Apr-12 Apr-13 Apr-14 Cyient 5X 7X 9X 11X 13X

Source: Bloomberg, Antique Strong revenue growth seen in 2QFY15 Cyient announced a robust set of numbers for 2QFY15, with constant currency revenue growth of 7.4% QoQ. It reported revenues of USD111m (QoQ growth of 6.6%), which was higher than our estimate. Revenues were broad-based across operating units. Though revenues from engineering grew 4% QoQ, the same for DNO grew 11% QoQ, led by growth in Softential.

Revenue growth of 6.6% QoQ in 2QFY15 120 10%

100 8% 6% 80 4% 60 2% 40 0% 20 -2% 0 -4% 1QFY13 2QFY13 3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15

Revenue (USDm) QoQ grow th (%)

Source: Company, Antique Strong growth across operating units The company witnessed broad-based growth across industry units. Growth was driven by a ramp-up in key clients in semiconductor, aerospace, energy, and communications. Moreover, Softential saw strong QoQ growth of 48%. Excluding revenues from Softential, overall revenues grew 5.1% QoQ, which indicates significant business strength. ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 10

2QFY15: Growth across verticals Composition Revenue QoQ growth YoY growth (%) (USDm) (%) (%) Aerospace 33 37 5 22 Transportation 10 12 (1) 15 Off-highway products 5 6 13 9 Semiconductor 6 7 12 48 Medical and electronics 1 1 (18) 10 Utilities 11 12 15 35 Communications 15 17 16 43 Energy and natural resources 7 8 5 21 Commercial and geospatial 9 10 (2) 34 Others 1 1 18 (16) Total 100 111 7 27

Source: Company, Antique Outlook for most industry units positive The management maintained a positive outlook for most industry units. In aerospace, it is working on new areas such as after market, manufacturing, and analytics services, and sees high growth potential. Strong demand for these services is also being reflected in newly bagged orders. Despite challenges in Europe, due to slower ramp-ups, the company has managed to grow by 5% QoQ. In transportation, the management indicated some delays in signalling projects. However, there is positive traction in rolling stock clients, thus maintaining a stable outlook for the industry unit. Positive traction is being seen in North America and India for off-highway products. However, the overall growth outlook continues to remain muted. Energy and natural resources too continue to remain weak on account of softness in mining. However, Cyient expects a recovery in this area towards FY15-end. The company continues to see positive movement in medical, electronics, and semiconductor. During the quarter, it signed a deal with a large Taiwanese semiconductor client for chip design. This has been a huge positive and can lead to additional opportunities going forward. Utilities continued to be strong, with continued ramp-up in its largest utility customer from North America. Apart from this, the company is expecting to close a couple of deals in Asia- Pacific, which can lead to further acceleration going forward. Growth in communications was led by high growth in Softential. However, organic growth outlook seems positive on account of additional synergies created by the acquisition of Softential. Strong margin performance in 2QFY15 EBITDA margins expanded 197bps QoQ to 16.1%, higher than our estimate of a 143bps expansion. Margins expanded on account of strong volume growth, SG&A optimisation, higher utilisation, and favourable exchange impact. However, the offshore component continued to remain low at 47%. This provides a significant lever for margin expansion going forward. The management is confident of improving margins by 100-150bps over the next two quarters. There is scope to expand near-term margins from current levels, given improvement in delivery efficiency, utilisation, offshoring, reduction of sub-contracting costs, and SG&A optimisation. ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 11

197bps QoQ expansion in EBITDA margins in 2QFY15 Lower SG&A costs in 2QFY15 1,200 25% 16% 14.5% 14.3% 14% 1,000 20% 800 12% 15% 10% 8.9% 600 7.8% 10% 8% 400 6% 5% 200 4% 0 0% 2% 0% S&M expenses (% of sales) G&A expenses (% of sales) 1QFY13 2QFY13 3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15

EBITDA (INRm) EBITDA mar gin ( % ) 1QFY15 2QFY15

Source: Company, Antique Source: Company, Antique

Blended utilisation higher by 40bps QoQ Significant potential for margin levers in offshoring 90% 100% 90% 85% 80% 51% 49% 50% 51% 48% 50% 51% 49% 48% 47% 79% 70% 78% 77% 80% 76% 77% 77% 60% 75% 75% 74% 75% 50% 75% 40% 30% 49% 51% 50% 49% 52% 50% 49% 51% 52% 54% 70% 20% 10% 65% 0% 1QFY13 2QFY13 3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15 1QFY13 2QFY13 3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15 Engineering DNO Blended Onsite (%) Offshore (%)

Source: Company, Antique Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 12

Financials

Profit and loss account (INRm) Cash flow statement (INRm) Year ended 31 Mar 2012 2013 2014 2015e 2016e Year ended 31 Mar 2012 2013 2014 2015e 2016e Revenues 15,530 18,731 22,064 26,982 31,313 PBT 2,349 3,148 3,538 4,580 5,725 Expenses 12,840 15,315 17,963 22,446 25,553 Depreciation & amortisation 494 635 720 731 841 EBIDTA 2,689 3,416 4,101 4,536 5,760 Interest expense 7 3 14 46 44 Depreciation 494 635 720 731 841 Interest/dividend received (287) (374) (413) (432) (530) EBIT 2,195 2,780 3,381 3,806 4,919 Other adjustments 133 (155) 61 - - Other income 175 398 187 821 850 (Inc)/dec in working capital (749) (799) (669) (957) (810) Interest expense 7 12 29 46 44 Tax paid (689) (855) (1,025) (1,132) (1,546) Profit before tax 2,363 3,166 3,538 4,580 5,725 CF from operating activities 1,259 1,605 2,227 2,836 3,724 Taxes including deferred taxation 835 967 1,030 1,132 1,546 Capital expenditure (790) (922) (761) (749) (1,000) Extra ordinary items & others 84 111 152 159 240 (Purchase)/sale of Investments 88 (376) 206 200 (200) Profit after tax 1,612 2,311 2,660 3,608 4,420 Income from investments 633 363 378 591 770 Recurring EPS 14.5 20.7 23.7 32.1 39.4 CF from investing activities (69) (935) (176) 42 (430) Inc/(dec) in share capital 17 29 52 1 - Balance sheet (INRm) Inc/(dec) in debt - 2 - (50) - Year ended 31 Mar 2012 2013 2014 2015e 2016e Dividends & interest paid (331) (419) (535) (1,101) (1,336) Share capital 557 558 560 561 561 Others 21 (31) 55 - - Reserves & surplus 11,018 12,667 15,325 17,877 21,004 CF from financing activities (294) (419) (427) (1,151) (1,336) Net worth 11,575 13,225 15,885 18,438 21,565 Net cash flow 896 250 1,623 1,728 1,958 Debt 34 3 58 428 408 Opening balance 3,492 4,528 4,962 6,913 8,640 Deferred tax liability & others 486 426 433 498 498 Closing balance 4,389 4,778 6,585 8,640 10,598 Capital employed 12,095 13,655 16,376 19,365 22,471 Gross fixed assets 6,404 7,301 7,976 8,726 9,726 Growth indicators (%) Accumulated depreciation 3,345 3,973 4,634 5,364 6,206 Year ended 31 Mar 2012 2013 2014 2015e 2016e Net assets 3,059 3,328 3,342 3,362 3,521 Revenue 30.7 20.6 17.8 22.3 16.1 Capital work in progress & others 996 1,179 1,127 1,131 1,131 EBITDA 49.8 27.0 20.1 10.6 27.0 Investments 466 983 925 725 925 PAT 15.5 43.3 15.1 35.6 22.5 Goodwill 209 26 23 1,423 1,423 EPS 15.5 42.9 14.6 35.6 22.5 Current assets, loans & adv. 9,307 10,584 14,047 17,543 20,717 Debtors 4,262 4,869 5,981 6,949 8,064 Valuation (x) Cash & bank balances 4,528 4,962 6,913 8,640 10,598 Year ended 31 Mar 2012 2013 2014 2015e 2016e Loans & advances and others 517 753 1,154 1,954 2,054 PE 31.1 21.8 19.0 14.0 11.4 Current liabilities & prov. 1,942 2,445 3,089 4,820 5,246 P/BV 4.3 3.8 3.2 2.7 2.3 Creditors 1,464 1,961 2,464 4,495 4,921 EV/EBITDA 16.9 13.1 10.5 9.3 6.9 Other liabilities & provisions 477 484 625 325 325 EV/Sales 2.9 2.4 2.0 1.6 1.3 Net current assets 7,365 8,138 10,958 12,723 15,471 Dividend Yield (%) 0.6 1.0 1.1 2.1 2.6 Application of funds 12,095 13,655 16,376 19,365 22,471 Financial ratios Per share data Year ended 31 Mar 2012 2013 2014 2015e 2016e Year ended 31 Mar 2012 2013 2014 2015e 2016e RoE (%) 13.9 17.5 16.7 19.6 20.5 No. of shares (m) 111 112 112 112 112 RoCE (%) 22.2 25.0 25.0 23.4 25.6 BVPS (INR) 104 118 142 164 192 Debt/Equity (x) 0.0 0.0 0.0 0.0 0.0 CEPS (INR) 43 50 65 78 97 EBIT/Interest (x) 299.1 229.8 115.4 82.3 113.1 DPS (INR) 3 4 5 9 12 Source: Company Antique

Margins (%) Year ended 31 Mar 2012 2013 2014 2015e 2016e EBIDTA 17.3 18.2 18.6 16.8 18.4 EBIT 14.1 14.8 15.3 14.1 15.7 PAT 10.4 12.3 12.1 13.4 14.1

Source: Company, Antique ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 13

Valuation Guide

Company Reco CMP TP Return M.Cap M.Cap Net profit (INRbn) EPS (INR) PE (x) EV/EBITDA (x) P/BV (x) RoE (%) RoCE (%) Absolute (%) (INR) (INR) (%) (INRbn) (USDbn) FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY15 FY15 FY15 1m 12m AUTOMOBILES HOLD 45 34 (25) 127 2.1 (4.8) (1.1) 5.1 (1.8) (0.4) 1.8 (24.9) (115.7) 24.9 99.5 26.8 12.1 3.4 (5.0) 1.5 8 163 Bajaj Auto HOLD 2,412 2,359 (2) 698 11.4 33.5 35.5 42.1 115.7 122.7 145.4 20.9 19.7 16.6 15.8 13.9 11.6 6.5 32.9 48.2 3 13 Bosch HOLD 14,598 13,965 (4) 458 7.5 8.8 11.4 14.5 281.8 364.7 463.0 51.8 40.0 31.5 38.2 30.8 25.1 6.3 15.9 24.9 (2) 69 BUY 11,212 12,613 13 304 4.9 3.9 7.5 12.0 145.7 277.4 442.8 77.0 40.4 25.3 43.4 27.1 17.0 8.2 28.0 29.8 (7) 185 HOLD 170 179 5 145 2.4 4.9 6.5 8.3 5.7 7.7 9.8 29.6 22.2 17.4 19.3 15.5 12.4 3.5 15.6 20.8 (3) 24 Hero MotoCorp BUY 2,852 3,151 10 570 9.3 21.1 27.1 36.7 105.6 135.9 184.0 27.0 21.0 15.5 20.8 16.0 11.7 9.3 44.4 61.2 3 36 M&M HOLD 1,274 1,300 2 791 12.9 38.5 39.8 48.9 58.6 60.6 74.5 21.7 21.0 17.1 15.1 13.5 10.8 4.2 19.8 24.5 (8) 47 BUY 2,962 3,302 11 895 14.6 27.9 35.6 52.0 92.5 117.8 172.3 32.0 25.2 17.2 15.6 12.3 8.5 3.7 14.8 21.8 (0) 105 Tata Motors BUY 488 583 20 1,467 23.9 161.4 196.1 241.7 50.1 60.9 75.1 9.7 8.0 6.5 4.9 4.2 3.4 1.9 23.4 21.1 (6) 25 Limited BUY 740 826 12 72 1.2 4.9 5.6 6.7 50.5 58.1 68.8 14.6 12.7 10.8 10.6 8.8 7.2 3.2 26.1 18.4 (7) 179 Ceat Limited BUY 792 589 (26) 28 0.5 2.8 2.9 3.5 78.1 79.6 98.2 10.1 9.9 8.1 5.9 6.1 5.3 2.1 22.5 22.8 1 428 Limited BUY 216 242 12 110 1.8 9.6 12.2 12.2 19.0 24.2 24.2 11.4 8.9 8.9 6.4 5.4 5.3 1.7 20.7 26.8 4 225 BUY 776 917 18 181 2.9 4.2 6.7 9.7 18.0 28.7 41.7 43.2 27.0 18.6 19.1 14.1 10.7 5.7 22.8 20.9 (13) 186 FMCG & RETAIL Asian Paints BUY 646 777 20 620 10.1 12.2 15.7 19.5 12.8 16.4 20.3 50.4 39.4 31.9 30.7 24.2 19.2 14.8 37.5 47.7 (4) 37 Colgate SELL 1,701 1,378 (19) 231 3.8 4.8 5.3 6.2 35.0 38.8 45.9 48.7 43.8 37.0 36.3 30.7 24.5 35.3 80.5 104.0 6 39 India HOLD 210 193 (8) 369 6.0 9.2 10.5 13.0 5.3 6.0 7.4 39.9 34.8 28.3 32.7 28.0 22.8 11.4 32.6 30.6 (6) 24 Radico Khaitan BUY 88 136 55 12 0.2 0.9 1.0 1.2 6.8 7.6 8.8 13.0 11.6 10.0 9.3 9.0 8.2 1.4 11.6 11.3 (7) (39) Godrej Consumer HOLD 954 789 (17) 325 5.3 7.6 8.5 10.7 22.9 25.0 31.6 41.6 38.2 30.2 28.9 26.3 20.6 7.4 19.3 19.6 (7) 15 HUL BUY 731 861 18 1,582 25.8 35.5 40.0 46.5 16.4 18.5 21.5 44.5 39.6 34.0 34.8 29.7 25.0 41.8 105.6 131.3 (3) 23 ITC BUY 347 398 15 2,767 45.1 87.9 101.4 122.2 11.0 12.8 15.4 31.4 27.2 22.6 22.6 19.5 16.0 9.2 33.7 43.0 (2) 2 Jyothy Labs BUY 253 240 (5) 46 0.7 1.1 1.7 1.9 6.0 9.6 10.4 42.1 26.3 24.2 32.0 26.4 19.2 4.4 16.9 7.6 (5) 44 HOLD 300 253 (16) 193 3.1 5.2 5.3 6.2 8.1 8.1 9.7 37.1 36.8 31.0 26.2 22.2 18.1 10.5 28.6 30.0 3 41 Nestle India HOLD 5,946 5,337 (10) 573 9.3 11.2 11.6 14.7 117.6 120.0 152.5 50.6 49.6 39.0 29.8 29.9 24.4 19.2 39.0 51.7 (7) 17 BUY 388 420 8 345 5.6 7.6 9.2 12.4 8.6 10.4 14.0 45.3 37.4 27.7 36.2 29.9 21.1 10.7 28.5 32.0 0 64 TBZ BUY 156 204 31 10 0.2 0.5 0.5 0.9 8.3 8.0 13.6 18.9 19.4 11.5 12.0 11.4 7.3 2.2 11.1 9.1 (2) 17 SELL 2,441 2,203 (10) 355 5.8 0.5 2.6 5.7 3.4 18.1 39.5 716.3 135.1 61.9 38.1 32.0 23.2 4.2 3.1 7.1 6 (6) Tilaknagar Ind BUY 43 75 73 5 0.1 0.6 0.8 1.1 4.8 6.1 8.7 9.0 7.1 5.0 7.4 6.7 5.6 0.8 11.5 11.2 (8) (29) V- Mart HOLD 589 366 (38) 11 0.2 0.3 0.4 0.5 14.0 21.8 28.7 42.1 27.1 20.5 20.5 14.3 11.1 5.1 18.7 25.7 3 196 INDUSTRIALS ABB HOLD 1,053 1,004 (5) 223 3.6 1.8 2.9 4.3 8.3 13.6 20.2 126.1 77.3 52.2 48.1 36.1 27.8 7.8 10.1 15.8 (8) 88 BGR HOLD 151 125 (17) 11 0.2 1.5 1.7 2.0 20.2 23.9 27.8 7.5 6.3 5.4 5.8 4.9 4.2 0.8 12.7 11.4 (12) 35 BHEL BUY 226 315 39 553 9.0 34.6 32.9 38.6 14.2 13.4 15.8 16.0 16.8 14.3 10.2 9.3 7.3 1.6 9.6 9.8 2 56 Crompton Greaves BUY 205 296 44 129 2.1 2.4 5.8 8.5 3.9 9.3 13.5 52.7 22.2 15.2 20.9 13.3 9.6 3.6 16.0 11.3 (7) 110 India BUY 676 811 20 187 3.1 6.2 7.2 9.0 22.3 26.0 32.5 30.3 26.0 20.8 26.8 23.7 18.7 6.8 25.0 25.5 (2) 68 India HOLD 267 1,043 291 167 2.7 4.5 6.2 7.4 35.7 49.5 58.9 7.5 5.4 4.5 25.3 25.4 24.8 1.6 33.2 32.3 (8) 86 Larsen & Toubro BUY 1,440 1,800 25 1,337 21.8 49.0 52.8 62.1 52.9 56.9 67.0 27.2 25.3 21.5 20.9 18.0 14.5 3.6 14.1 12.3 (9) 64 BUY 813 1,032 27 289 4.7 5.1 7.7 10.5 14.2 21.5 29.5 57.2 37.8 27.5 29.8 20.5 14.6 6.2 16.5 23.9 (8) 61 KEC HOLD 103 90 (12) 26 0.4 0.7 1.7 2.3 3.3 6.5 9.0 31.0 15.8 11.3 8.7 6.9 5.8 2.0 12.8 17.1 (12) 225 Voltas HOLD 234 242 4 77 1.3 2.2 3.2 4.5 6.8 9.7 13.4 34.5 24.2 17.4 29.1 21.5 15.0 3.9 16.1 14.7 (9) 180 INFORMATION TECHNOLOGY Cyient BUY 448 550 22 50 0.8 2.7 3.4 4.2 23.7 30.1 37.2 18.8 14.8 12.0 10.3 9.1 7.1 2.7 18.5 23.9 (1) 100 HCL Tech HOLD 1,723 1,600 (7) 1,208 19.7 62.8 71.8 81.6 89.5 102.2 116.1 19.3 16.9 14.8 13.2 11.3 9.6 4.7 31.0 29.4 6 50 Hexaware Tech SELL 182 125 (31) 55 0.9 3.8 3.1 4.1 12.8 10.6 13.9 14.2 17.1 13.0 9.4 11.0 8.7 3.5 22.1 21.9 2 39 Infosys Ltd. BUY 3,918 3,900 (0) 2,250 36.6 108.7 121.8 139.9 189.8 212.6 244.1 20.6 18.4 16.1 14.6 12.7 10.6 4.0 23.5 22.9 7 18 KPIT BUY 160 220 37 31 0.5 2.5 2.8 3.5 13.0 14.7 18.2 12.4 10.9 8.8 7.6 6.9 4.9 2.0 18.2 19.7 (3) 10 HOLD 411 465 13 86 1.4 3.5 7.3 8.9 14.7 34.5 42.2 27.9 11.9 9.7 18.2 7.8 6.6 1.6 13.9 10.3 (8) (9) Persistent Sys HOLD 1,431 1,350 (6) 57 0.9 2.5 3.0 3.7 62.3 74.5 91.5 23.0 19.2 15.6 13.3 12.4 9.3 4.0 20.6 23.0 9 107 TCS BUY 2,699 2,825 5 5,287 86.1 193.1 217.6 263.3 98.6 111.2 134.5 27.4 24.3 20.1 20.5 18.4 14.8 8.6 35.3 41.1 4 24 BUY 2,372 2,800 18 559 9.1 25.8 29.0 36.8 110.6 124.0 157.4 21.5 19.1 15.1 13.1 11.9 9.5 4.9 28.1 32.4 (3) 52 Wipro HOLD 580 590 2 1,431 23.3 78.4 88.2 99.6 31.8 35.8 40.4 18.2 16.2 14.3 14.1 11.9 10.3 3.5 21.5 23.6 1 16

UR: Under Review contd... ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 14

Valuation Guide

Company Reco CMP TP Return M.Cap M.Cap Net profit (INRbn) EPS (INR) PE (x) EV/EBITDA (x) P/BV (x) RoE (%) RoCE (%) Absolute (%) (INR) (INR) (%) (INRbn) (USDbn) FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY15 FY15 FY15 1m 12m MEDIA

Den Networks BUY 186 220 18 33 0.5 0.8 1.5 2.4 3.4 8.3 13.4 54.0 22.3 13.9 9.3 7.5 4.7 1.7 7.4 7.7 4 18

Dish TV India BUY 55 70 28 58 1.0 (0.9) 1.3 3.8 (2.0) 1.3 3.6 (27.8) 43.9 15.3 12.9 8.5 6.7 (30.0) nm 16.5 (2) 2

Hathway Cable BUY 301 350 16 49 0.8 0.14 1.35 2.23 1.0 9.5 15.6 300.5 31.8 19.2 18.4 11.6 6.9 2.0 10.0 13.7 1 12

Just Dial Ltd HOLD 1,645 1,650 0 115 1.9 1.21 1.33 2.08 17.2 18.9 29.6 95.5 87.1 55.6 76.5 68.4 41.3 17.8 20.4 20.7 (3) 89

Sun TV Network BUY 308 485 58 121 2.0 7.5 8.9 10.6 19.2 22.6 26.8 16.1 13.6 11.5 9.8 8.2 6.9 3.4 25.1 33.1 (12) (27)

Zee Ent HOLD 316 280 (11) 304 4.9 8.9 10.1 11.5 9.3 10.5 11.9 34.0 30.0 26.5 24.7 23.4 20.3 5.5 18.3 19.9 11 31 METALS & MINING

Hindalco Industries SELL 151 137 (9) 312 5.1 27.8 35.1 41.3 13.4 17.0 20.0 11.2 8.9 7.5 10.4 8.4 6.9 0.8 8.3 5.5 (10) 37

Hindustan Zinc BUY 159 182 14 672 10.9 69.7 70.4 74.8 16.5 16.7 17.7 9.6 9.5 9.0 6.0 5.2 4.2 1.6 17.6 42.9 (6) 22

JSW Steel HOLD 1,143 1,276 12 276 4.5 21.6 28.0 32.0 89.6 115.9 132.4 12.8 9.9 8.6 7.2 6.3 5.7 1.2 12.5 7.8 (15) 47

SAIL HOLD 77 85 10 320 5.2 16.6 30.0 33.9 4.0 7.3 8.2 19.3 10.7 9.4 12.0 9.6 8.2 0.7 6.9 4.9 (3) 35

TATA Steel BUY 456 596 31 443 7.2 36.2 41.6 62.7 37.3 42.9 64.5 12.2 10.6 7.1 7.3 6.9 6.1 0.9 9.2 5.2 (12) 51

NMDC HOLD 154 184 20 610 9.9 63.7 72.6 78.8 16.1 18.3 19.9 9.6 8.4 7.7 5.4 4.8 4.4 1.8 22.9 44.3 (13) 19

Nalco BUY 61 61 (0) 157 2.6 6.9 9.1 9.1 2.7 3.5 3.5 22.7 17.3 17.2 11.1 8.5 7.6 1.2 7.3 7.2 (7) 86 OIL & GAS

BPCL HOLD 656 700 7 475 7.7 36.5 30.9 34.0 55.7 47.2 51.8 11.8 13.9 12.7 6.9 7.5 7.1 2.0 14.2 11.9 (4) 92

Cairn India HOLD 284 350 23 533 8.7 124.3 110.5 116.9 65.9 57.8 60.9 4.3 4.9 4.7 3.8 3.8 3.2 0.8 21.9 19.8 (13) (12)

GAIL India HOLD 447 415 (7) 568 9.2 41.4 40.4 41.8 32.6 31.9 33.0 13.7 14.0 13.6 9.6 10.2 8.9 1.9 13.8 12.3 (3) 36

Gujarat State Petro BUY 89 110 24 50 0.8 4.2 4.4 5.1 7.4 7.9 9.1 11.9 11.2 9.8 6.4 6.2 5.6 1.4 12.1 14.7 (6) 59

HPCL HOLD 498 500 1 169 2.7 14.4 12.9 16.6 42.3 38.0 49.1 11.8 13.1 10.1 8.6 8.0 6.8 1.0 5.1 2.0 1 162

Indian Oil Corp BUY 367 450 23 892 14.5 58.5 78.6 88.6 24.7 33.2 37.4 14.9 11.1 9.8 10.4 8.6 6.6 1.2 10.9 7.3 (8) 81

Indraprastha Gas BUY 420 450 7 59 1.0 3.6 4.1 4.5 25.7 29.6 31.9 16.3 14.2 13.2 7.6 7.5 6.7 2.9 20.4 23.8 (3) 49

MRPL SELL 60 53 (12) 106 1.7 6.0 1.8 9.5 3.4 1.1 5.4 17.6 57.3 11.1 9.0 29.3 7.5 1.5 2.6 1.2 (6) 66

Oil India BUY 583 753 29 351 5.7 28.8 31.5 46.6 48.0 52.4 77.5 12.2 11.1 7.5 8.3 6.8 4.5 1.6 14.0 11.1 (8) 26

ONGC BUY 402 500 24 3,441 56.0 226.4 248.1 326.4 31.7 34.1 43.3 12.7 11.8 9.3 7.6 6.9 5.5 2.3 16.5 19.5 (6) 46

Petronet LNG HOLD 180 170 (6) 135 2.2 7.1 7.5 7.5 9.5 10.0 10.0 19.0 18.0 17.9 10.5 9.8 9.4 2.4 13.6 13.6 (10) 44

Reliance Industries BUY 961 1,060 10 3,109 50.6 224.9 241.8 246.9 69.6 74.8 76.4 13.8 12.9 12.6 11.8 11.2 10.2 1.3 11.0 7.0 (5) 10 PHARMACEUTICALS

Cipla HOLD 579 641 11 464 7.6 12.7 14.9 21.0 15.9 18.6 26.1 36.5 31.1 22.1 23.3 20.3 14.8 4.1 13.4 11.4 (6) 37

Dr Reddy's BUY 2,935 3,547 21 500 8.1 18.7 25.1 30.2 109.9 147.7 177.4 26.7 19.9 16.5 16.6 13.4 11.1 5.0 25.2 18.9 (1) 21

Lupin HOLD 1,330 1,391 5 597 9.7 17.5 25.5 28.3 39.0 57.0 63.2 34.1 23.3 21.0 19.8 14.1 12.8 6.6 31.9 28.9 (2) 47

Sun Pharma BUY 803 916 14 1,663 27.1 56.8 67.3 88.2 27.4 32.5 36.7 29.3 24.7 21.9 23.0 18.6 13.5 6.8 27.7 28.6 (0) 28

Aurobindo SELL 931 625 (33) 271 4.4 11.7 14.2 15.2 46.8 48.8 52.1 19.9 19.1 17.9 14.4 13.2 12.0 5.3 32.2 17.3 4 344

Cadila Health BUY 1,343 1,443 7 275 4.5 8.8 11.3 14.8 41.7 55.0 72.2 32.2 24.4 18.6 23.1 17.5 13.6 6.2 26.7 17.8 6 102

Strides BUY 797 879 10 47 0.8 1.2 2.2 3.4 20.5 37.8 56.3 8.3 21.4 11.6 21.5 15.5 10.2 3.5 22.3 13.7 9 114

Glenmark HOLD 735 793 8 199 3.2 7.3 9.7 13.0 25.6 36.5 48.6 28.8 20.1 15.1 17.6 13.6 10.6 5.1 29.9 23.5 (5) 29

Biocon HOLD 476 461 (3) 95 1.5 4.1 4.9 6.1 20.5 24.4 30.5 23.3 19.5 15.6 13.9 11.5 8.8 2.8 15.4 9.8 (5) 43

Unichem HOLD 225 228 1 20 0.3 1.0 1.4 1.9 13.0 15.8 20.7 17.3 14.2 10.9 11.5 9.7 7.6 2.3 16.0 13.6 (7) 35 SHIPPING AND LOGISTICS

Container Corp. HOLD 1,328 1,283 (3) 259 4.2 10.1 11.5 13.9 51.7 58.7 71.3 25.7 22.6 18.6 19.5 16.4 13.0 3.3 14.5 20.9 3 81

GE Shipping HOLD 412 372 (10) 62 1.0 4.6 5.7 7.4 30.8 38.1 48.9 13.4 10.8 8.4 6.2 5.6 4.8 0.9 6.8 7.6 (2) 47

Adani Port and SEZ HOLD 260 232 (11) 539 8.8 20.1 21.5 26.9 9.6 10.3 12.9 27.0 25.2 20.1 22.3 17.3 14.4 5.2 20.1 16.5 (11) 72

Gujarat Pipavav HOLD 161 81 (50) 78 1.3 1.8 2.1 2.3 3.6 4.4 4.8 44.4 37.0 33.8 30.7 27.3 22.3 5.3 14.3 13.9 (10) 250

UR: Under Review contd... ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 15

Valuation Guide

Company Reco CMP TP Return M.Cap M.Cap Net profit (INRbn) EPS (INR) PE (x) EV/EBITDA (x) P/BV (x) RoE (%) RoCE (%) Absolute (%) (INR) (INR) (%) (INRbn) (USDbn) FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY15 FY15 FY15 1m 12m UTILITIES

CESC HOLD 710 501 (30) 89 1.4 6.5 6.7 7.1 39.2 42.6 64.8 18.1 16.7 11.0 11.5 8.7 6.4 1.6 9.6 7.2 (6) 109

NTPC HOLD 141 141 0 1,160 18.9 114.0 103.6 109.6 13.8 12.6 13.3 10.2 11.2 10.6 8.8 8.8 8.6 1.2 11.1 7.8 2 (2)

Power Grid BUY 136 166 22 712 11.6 45.0 52.4 61.1 8.6 10.0 11.7 15.8 13.6 11.7 11.6 10.4 9.3 1.8 13.6 7.7 1 37

PTC India BUY 84 122 46 25 0.4 3.6 2.6 3.7 8.5 5.9 8.5 9.8 14.2 9.8 6.2 8.9 5.5 0.9 6.7 6.8 (10) 51

Tata Power HOLD 87 101 17 235 3.8 (2.6) 18.6 19.6 (1.1) 6.9 7.3 (79.4) 12.6 12.0 7.6 6.2 5.7 1.6 12.6 11.6 (3) 11

Coal India BUY 344 442 28 2,174 35.4 151.1 177.4 210.4 23.9 28.1 33.3 14.4 12.3 10.3 10.5 8.6 6.4 4.5 36.3 32.6 (4) 21 OTHERS

Supreme Industries HOLD 611 592 (3) 78 1.3 2.5 3.2 4.1 22.3 31.5 37.8 27.4 19.4 16.2 14.8 12.4 10.5 6.0 30.3 31.6 (7) 69

Cera Sanitaryware HOLD 1,685 1,556 (8) 21 0.3 0.5 0.7 0.8 41.6 55.1 66.4 40.5 30.6 25.4 24.0 18.5 15.4 7.5 27.5 32.2 1 197

Kajaria Ceramics HOLD 644 612 (5) 49 0.8 1.2 1.7 2.2 15.6 21.3 27.8 41.2 30.2 23.2 18.2 14.4 11.2 8.0 26.4 30.2 (2) 187

Finolex Industries BUY 338 340 1 42 0.7 1.7 2.4 2.8 13.7 19.3 22.7 24.6 17.5 14.9 13.2 10.1 8.7 4.7 28.4 25.0 5 196

Astral Poly Technik Limited HOLD 376 783 108 42 0.7 0.8 1.2 1.8 14.0 22.0 31.3 26.8 17.1 12.0 26.8 20.1 15.2 5.1 33.7 39.3 (10) 198

HSIL BUY 405 379 (6) 27 0.4 0.3 0.8 1.3 5.1 11.4 19.5 78.7 35.4 20.8 14.6 11.2 8.7 2.5 7.2 11.4 15 418

Somany Ceramics Limited HOLD 313 285 -9 12 0.2 0.3 0.5 0.6 7.4 11.8 15.9 42.1 26.4 19.7 16.0 12.7 10.1 4.6 18.7 18.0 1 281

Company Reco CMP TP Return M.Cap M.Cap Net profit (INRbn) EPS (INR) PE (x) NNPA Ratio (%) P/AdjBV (x) RoE (%) RoA (%) Absolute (%)

(INR) (INR) (%) (INRbn) (USDbn) FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY15 FY15 FY15 1m 12m FINANCIALS

Axis Bank BUY 397 440 11 937 15.3 62.2 74.1 87.2 132.3 157.8 185.5 3.0 2.5 2.1 0.4 0.4 0.4 0.4 17.9 1.8 (5) 79

Bank of Baroda BUY 872 1007 16 374 6.1 45.4 50.1 55.7 105.4 116.2 129.3 8.3 7.5 6.7 1.5 1.7 1.5 1.1 13.2 0.7 (8) 53

Bank of India HOLD 256 268 5 164 2.7 27.3 34.2 42.7 42.4 53.2 66.4 6.0 4.8 3.8 3.2 3.2 3.1 0.6 10.9 0.6 (12) 37

Canara Bank HOLD 379 415 9 175 2.8 24.4 33.3 42.2 52.9 72.1 91.5 7.2 5.3 4.1 2.0 1.8 1.7 0.7 10.7 0.6 (8) 55

Federal Bank BUY 139 158 14 119 1.9 8 11 13 9.8 12.5 15.6 14.2 11.1 8.9 0.7 0.2 0.2 1.5 13.6 1.3 9 100

HDFC HOLD 1,004 904 (10) 1575 25.6 54.4 63.4 76.5 34.9 40.6 49.0 28.8 24.7 20.5 0.2 0.2 0.2 5.0 21.0 2.9 (4) 25

HDFC Bank HOLD 868 780 (10) 2096 34.1 84.8 106.8 135.6 35.5 44.5 56.5 24.5 19.5 15.4 0.3 0.2 0.2 4.1 22.4 2.0 1 30

ICICI Bank BUY 1,478 1575 7 1711 27.8 98.1 111.5 130.2 84.5 95.9 112.1 17.5 15.4 13.2 1.0 1.0 1.0 2.2 13.7 1.7 (6) 48

IndusInd Bank HOLD 649.75 650 0 343 5.6 14.1 18.1 22.3 26.8 34.4 42.3 24.3 18.9 15.3 0.3 0.4 0.4 3.3 18.4 1.9 3 52

Kotak Mahindra HOLD 1,013 849 (16) 781 12.7 15.0 18.4 22.1 19.5 23.9 28.7 51.9 42.4 35.2 0.8 0.9 1.1 5.8 14.0 1.9 (5) 45

PNB BUY 926 1085 17 335 5.5 33.4 47.6 58.7 92.3 131.5 162.1 10.0 7.0 5.7 2.8 2.8 2.5 1.1 12.5 0.8 (6) 90

SBI BUY 2,524 3045 21 1884 30.7 108.9 143.3 218.5 145.9 192.0 292.7 17.3 13.1 8.6 2.1 1.9 1.7 1.8 11.5 0.7 (4) 52

Union Bank BUY 212 232 9 135 2.2 17.0 22.4 26.7 26.9 35.5 42.3 7.9 6.0 5.0 2.3 2.4 2.5 0.9 12.5 0.6 (1) 74

YES Bank BUY 587 653 11 244 4.0 16.2 18.3 21.1 44.9 50.7 58.4 13.1 11.6 10.1 0.0 0.0 0.0 2.4 23.1 1.5 (7) 68

Bajaj Auto Fin HOLD 2,727 2890 6 137 2.2 7.2 8.9 10.6 144.5 178.3 212.4 18.9 15.3 12.8 0.3 0.2 0.3 2.9 20.2 3.2 4 111

Chola Invst & Fin. HOLD 455 394 (13) 65 1.1 3.6 4.7 5.7 25.4 30.2 36.4 17.9 15.1 12.5 0.8 1.1 1.3 2.2 16.7 2.0 (9) 107

Gruh Finance BUY 189 240 27 69 1.1 1.8 2.3 2.9 9.8 6.4 8.0 19.3 29.5 23.5 - - - 9.0 34.0 3.5 (6) 74

LIC Housing Fin BUY 334 310 (7) 168 2.7 13.2 14.5 18.4 26.1 28.7 36.5 12.8 11.6 9.1 0.4 0.4 0.4 2.4 17.8 1.4 5 61

M&M Fin. HOLD 280 256 (9) 159 2.6 8.9 9.9 12.9 15.8 17.6 23.0 17.8 15.9 12.2 1.9 2.2 2.5 3.1 18.1 2.9 (5) 1

Manappuram BUY 28 26 (6) 23 0.4 2.3 2.0 2.3 2.7 2.4 2.8 10.3 11.3 10.0 0.4 0.4 0.4 0.9 8.0 1.9 3 82

Muthoot Finance BUY 189 225 19 75 1.2 7.8 8.3 9.9 21.0 20.9 24.9 9.0 9.0 7.6 1.1 0.9 0.9 1.6 17.6 3.9 (5) 95

PFC BUY 249 377 51 329 5.4 54.2 63.8 72.9 41.0 49.5 56.4 6.1 5.0 4.4 0.5 1.0 1.1 1.0 21.7 3.1 (6) 86

Repco Home Fin. BUY 470 573 22 29 0.5 1.1 1.5 1.8 17.7 24.0 29.7 26.5 19.6 15.8 0.7 0.7 0.7 3.4 19.6 2.6 7 77

REC HOLD 259 374 44 256 4.2 46.8 54.3 63.3 47.4 56.5 65.6 5.5 4.6 4.0 0.1 0.3 0.5 1.0 23.6 3.5 (8) 37

Shriram Transport HOLD 904 980 8 205 3.3 13.6 14.9 18.0 60.0 65.9 79.6 15.1 13.7 11.4 0.5 0.7 1.8 2.1 16.4 2.9 (7) 59

SKS Microfinance BUY 294 355 21 37 0.6 0.7 2.0 2.3 6.5 16.1 18.6 45.4 18.3 15.8 0.1 0.3 0.4 5.8 20.1 5.6 (13) 95

PTC Financial BUY 44 54 24 24 0.4 2.1 3.0 4.4 3.7 5.4 7.8 11.7 8.1 5.6 0 0 0 1.5 19.8 4.1 (6) 295

UR: Under Review ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 16

Events Calendar Oct/Nov 2014

Monday Tuesday Wednesday Thursday Friday Saturday Sun

13 Oct 14 Oct 15 Oct 16 Oct 17 Oct 18 Oct 19 Oct Hero MotoCorp Axis Bank LIC Housing Fin Somany Ceramics Persistent Systems Unichem Lab Crompton Greaves HCL Tech TCS Zee Entertainment Supreme Ind

20 Oct 21 Oct 22 Oct 23 Oct 24 Oct 25 Oct 26 Oct Exide Ind HDFC Bank HDFC SKS Microfinance Shriram Transport Fin Cairn India M&M Fin Services Just Dial JSW Steel Asian Paints KPIT Technologies Wipro United Spirits Havells

27 Oct 28 Oct 29 Oct 30 Oct 31 Oct 1 Nov 2 Nov Kajaria Ceramics Nestle Dr Reddy’s Labs ICICI Bank M&M Godrej Consumer ABB MphasiS Cholamandalam Fin Lupin

3 Nov 4 Nov 5 Nov 6 Nov 7 Nov 8 Nov 9 Nov Dabur TBZ

10 Nov 11 Nov 12 Nov 13 Nov 14 Nov 15 Nov ANTIQUE STOCK BROKING LIMITED FROM THE RESEARCH DESK 16 October 2014 | 17

Important Disclaimer:

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