Deccan Chronicle Holdings

Company Update

BUY Charged up for second innings

Price Rs114 Significant correction in newsprint prices coupled with higher profitability in the IPL venture are expected to drive a 42.8% CAGR in Earnings for Deccan Chronicle Holdings (DCHL) over Target Price Rs142 FY2009-11E. Moreover, as Balance Sheet concerns fade (Debt and Receivable days both Investment Period 12 months stand reduced), focus shifts to core properties (Print and IPL) and ongoing buy-back instills confidence, we believe that the DCHL stock warrants a re-rating. Hence, we upgrade DCHL Stock Info to a Buy, valuing the stock at 12x FY2011E EPS (40% discount to its peers like Jagran Sector Media and HT Media due to scalability issues), with a 12-month Target Price of Rs142.

Market Cap (Rs cr) 2,792 „ Print Business - Strengthening its foothold in South: Following launch of its Bangalore edition, DCHL registered total daily Circulation of 1.35mn during Jan - June (JJ) 2009 according Beta 0.9 to the Audit Bureau of Circulation (ABC, latest Circulation figures), an increase of 1.2% over 52 Week High / Low 124/26 Jan - Dec (JD) 2008 and 25.9% over JJ 2008. We believe that enhanced presence places Avg Daily Volume 520,265 DCHL in a significantly better position in terms of offering bundled advertising to any media planner looking for a pan-South platform. Face Value (Rs) 2 „ IPL holds promise: Deccan Chargers Sporting Ventures (DCSVL) houses the BSE Sensex 16,886 IPL team, Deccan Chargers (100% stake), which won the second season of IPL. In terms of financials, we expect DCSVL to record a sharp jump in Revenue in FY2010E to Rs100.6cr Nifty 5,020 (Rs56.6cr) driven by revised media telecast rights boosting Net Profit to Rs22cr (Rs1.6cr). We BSE Code 532608 remain optimistic on IPL's moneymaking prospects and any news flow on the stake sale front will trigger a re-rating in the DCHL stock. NSE Code DCHL „ Newsprint prices collapse, significant Margin expansion ahead: Over the past six Reuters Code DCHL.BO months, newsprint prices have collapsed. The 30-lbs benchmark US East coast, newsprint Bloomberg Code DECH@IN prices fell by almost 38% to US $465 from its peak in February 2009. For FY2010E, we expect DCHL to save almost Rs70cr in newsprint costs, despite higher newsprint consumption due to Shareholding Pattern (%) the Bangalore edition, as we have modeled a 31% drop in imported newsprint prices (landed Promoters 63.0 cost) to US $607. Further, we expect savings in newsprint cost to contribute almost 894bp to Margin expansion over FY2009-11E. MF / Banks / Indian FIs 16.5 Key Financials (Consolidated) FII / NRIs / OCBs 14.7 Y/E March (Rs cr) FY2008 FY2009 FY2010E FY2011E Indian Public / Others 5.8 Net Sales 895 968 1,086 1,194

Abs. 3m 1yr 3yr % chg 52.3 8.2 12.2 9.9 Net Profit 303.6 142.3 263.2 290.1 Sensex (%) 17.9 20.7 38.0 % chg 83.7 (53.1) 84.9 10.2 DCHL (%) 54.1 (2.2) 14.7 OPM (%) 61.4 31.0 42.4 41.0 Anand Shah EPS (Rs) 12.4 5.8 10.7 11.8 P/E (x) 9.2 19.6 10.6 9.6 Tel: 022 - 4040 3800 Ext: 334 P/BV (x) 2.3 2.2 2.0 1.8 E-mail: [email protected] RoE (%) 25.2 11.2 18.5 18.2 Chitrangda Kapur RoCE (%) 26.7 11.8 18.4 18.8 Tel: 022 - 4040 3800 Ext: 323 EV/Sales (x) 2.8 3.1 2.7 2.4 E-mail:[email protected] EV/EBITDA (x) 4.5 10.1 6.4 5.8 Source: Company, Angel Research

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 1 Deccan Chronicle Holdings

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Investment Arguments

Print Business - Strengthening its foothold in South India

Enhanced presence in South Consistent leadership in the Andhra Pradesh print market, steady position in Chennai (fighting places DCHL in a better competition from Times of India-TOI) and entry into Bangalore (third largest print advertising market) position to offer bundled in May 2008 have helped DCHL strengthen its foothold in the Southern markets. We believe that advertisements enhanced presence places DCHL in a significantly better position in terms of offering bundled advertising for any media planner looking for a pan-South India platform.

According to ABC JJ 2009, DCHL registered a total daily circulation of 1.35mn, an increase of 1.2% over JD 2008 and 25.9% over JJ 2008 (due to launch of the Bangalore edition). While the publication continues to strengthen its position in its core market of AP while holding on in Chennai, Bangalore has ramped up to an impressive daily circulation of 245,000 copies.

Exhibit 1: Circulation steady- Bangalore ramp up impressive

900 784 803 800 748 701 700 600

in '000) 500 400 302 303 306 303 300 243 245

(circulations 200 100 21 0 AP Bangalore Chennai

JD 2007 JJ 2008 JD 2008 JJ 2009 Source: ABC, Company, Angel Research

Readership declines in However, readership figures indicate a slightly different picture (Source: IRS). Among the Top-5 Chennai due to stiff English dailies, DCHL registered maximum erosion in readership, which currently stands at 1.09mn competition from TOI as per IRS 2009 R1. We attribute this fall in readership to a decline in Chennai, which was impacted (Bangalore edition not post TOI’s entry last year. However, the figures do not capture DCHL's Bangalore edition. captured yet) Exhibit 2: Readership under pressure due to competition Top-5 English Dailies Average Issue Readership (AIR) (‘000) 2009 R1 2008 R2 ror % 2008 R1 yoy % The Times of India 6,864 6,710 2.3 6,790 1.1 Hindustan Times 3,492 3,522 (0.9) 3,276 6.6 Hindu 2,237 2,121 5.5 2,244 (0.3) Deccan Chronicle 1,093 1,152 (5.1) 1,225 (10.8) Telegraph 1,083 1,018 6.4 1,009 7.3 Source: Indian Readership Survey (IRS), Angel Research; Note: R1= January to December period, R2 = July to June period; ror = readership over readership

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 2 Deccan Chronicle Holdings

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Andhra Pradesh - Deccan's cash cow

Market leader in AP with 60% Andhra Pradesh (AP) is DCHL's home market and remains the backbone of its operations readership generating strong Revenues and Cash flows. Deccan Chronicle is a market leader in AP accounting for almost 60% of the readership. Rich history dating back almost 70 years, larger set of offerings (with highly localised content) and higher pagination have helped DCHL maintain its stronghold in the region.

Exhibit 3: Deccan’s leadership in AP maintained (‘000) 2009 R1 2008 R2 ror % 2008 R1 yoy % Andhra Pradesh Deccan Chronicle 808 822 (1.7) 892 (9.4) The Hindu 384 374 2.7 409 (6.1) Time of India 192 192 - 185 3.8 Source: IRS, Angel Research

Going ahead, we estimate total Revenues from AP to post a CAGR of 9.7% over FY2009-11E to Rs660cr largely driven by a 10% CAGR in Advertising Revenues during the period as Circulation is expected to grow at a muted 4% CAGR. Modest Ad rate hikes, higher colour Ad space (colour commands a premium over B&W rates) and recovery in Ad Volumes (post 2HFY2010E) will aid Ad Revenue growth.

Exhibit 4: Strong position in AP to aid steady growth post economic recovery

700 850 660 650 800 596 600 572 549 750 550

(Rs cr) 700 ('000) 500

650 450

400 600 FY2008 FY2009 FY2010E FY2011E Revenues (LHS) Circulation (RHS) Source: Company, Angel Research

Chennai - Holding on

Currently enjoys No.2 position DCHL expanded its operations in Tamil Nadu with the launch of its flagship daily in Chennai in in Chennai market with daily March 2005. Deccan Chronicle currently enjoys No.2 position in the Chennai market with a daily circulation of 302,522 copies circulation of 302,522 copies (ABC JJ 2009) and a readership base of 282,000 readers (IRS 2009 R1). However, following entry of TOI last year, competition has intensified denting Deccan Chronicle's readership in Chennai, which is exhibiting signs of weakness.

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 3 Deccan Chronicle Holdings

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Exhibit 5: TOI’s entry has impacted Deccan’s readership in Chennai (‘000) 2009 R1 2008 R2 ror % 2008 R1 yoy % Tamil Nadu The Hindu 1,165 1,145 1.7 1,164 0.1 Deccan Chronicle 282 328 (14.0) 327 (13.8) The New Indian Express 146 158 (7.6) 156 (6.4) Source: IRS, Angel Research

Future growth in Revenue is Hence, going ahead, we expect Chennai to post a muted 3.6% CAGR in Revenue over likely from increased Ad FY2009-11E as future growth of Advertising in Chennai is likely to come from an uptick in volumes volumes rather than Ad rate (likely post 2HFY2010E due to economic recovery) rather than Ad rate hikes (absorption will be an hikes issue due to competition). However, our interaction with management exhibited strong confidence of its position in Chennai market and sees no significant threat from The Hindu or TOI.

Exhibit 6: Muted growth expected in Chennai due to competition

300 350

250 250 233 232 340 208 330 200 320 150

('000)

(Rs cr) 310 100 300

50 290

0 280 FY2008 FY2009 FY2010E FY2011E Revenues (LHS) Circulation (RHS) Source: Company, Angel Research

Bangalore - So far, so good

Deccan Chronicle has ramped Post expansion into Chennai, Deccan Chronicle was launched in Bangalore in May 2008 with an up its daily circulation to initial run of 100,000 copies. Currently, Deccan Chronicle has ramped up its daily circulation to 245,000 copies 245,000 copies (ABC JJ 2009), which compares well to leader TOI, which has a circulation of over 400,000 copies.

Over the past one year, Bangalore has emerged as an interesting market for the print dailies. Post Deccan's entry in Bangalore, DNA also launched its Bangalore daily edition in December 2008 further fragmenting the market. Not to be left behind, existing players also got into action, with Deccan Herald revamping its newspaper and The New Indian Express taking recourse to outdoor advertising. The impact of new players is clearly visible in recent readership trends, which reflect a drop for both TOI and Deccan Herald, the latter clearly impacted more than the others. Readership statistics of DNA and Deccan Chronicle's Bangalore editions have not been reported in the IRS, however both have registered an increase in circulation (DNA has an estimated circulation of 175,000 copies).

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 4 Deccan Chronicle Holdings

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Exhibit 7: New entrants dampen Readership of Incumbents in Bangalore (‘000) 2009 R1 2008 R2 ror % 2008 R1 yoy % Bangalore Deccan Herald 186 240 (22.5) 216 (13.9) Times of India 375 395 (5.1) 449 (16.5) Source: IRS, Angel Research

Bangalore edition to remain a While Deccan's circulation ramp up in Bangalore in a short time span has been impressive, we key incremental Revenue remain cautiously optimistic on DCHL's Bangalore venture (especially post the DNA launch) and growth driver await readership figures on the same. Nonetheless, we estimate the Bangalore edition to remain a key incremental Revenue growth driver for DCHL in the ensuing years posting Rs56cr and Rs70cr in Revenues in FY2010E and FY2011E, respectively. In terms of Profitability, we expect the edition to incur significant marketing expenses in the initial period and achieve breakeven only towards late 1HFY2011E when the Advertising Revenues grow to a level that they can absorb the fixed costs.

Exhibit 8: Bangalore ramp up impressive, Revenues to follow

80 400 70 70 350

60 56 300

50 250

40 200

('000)

(Rs cr) 31 30 150

20 100

10 50

0 0 FY2009 FY2010E FY2011E

Revenues (LHS) Circulation (RHS) Source: Company, Angel Research Subsidiaries gear up, IPL holds promise

DCHL has three wholly-owned subsidiaries, viz., Deccan Chargers Sporting Ventures (IPL), Odyssey India (leisure book store) and Sieger Solutions (Internet portals). While management has clearly shifted its focus from Seiger (expected to post a decline in Revenues) due to difficulty in monetising its Internet platform, Odyssey India witnessed significant expansion in FY2009 and is expected to register modest Revenues (Profitability remains an issue). However, the IPL venture holds tremendous promise both in terms of Revenue and Profit generation owing to revised media telecast rights.

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 5 Deccan Chronicle Holdings

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Exhibit 9: IPL, Odyssey to aid incremental Revenue growth

120 114.0 100.6 102.6 96.1 100 80.6 80 71.9 61.0 56.6 60 44.9

Revenue (Rs cr) 40 24.9 20 14.9

0 Odyssey Seiger DCSVL

FY08 FY09 FY10E FY11E Source: Company, Angel Research

Deccan Chargers Sporting Ventures (IPL) - Charging ahead

DCSVL to record a sharp jump Deccan Chargers Sporting Ventures (DCSVL) houses the Hyderabad IPL team, Deccan Chargers in Revenues in FY2010E to (100% stake). DCHL bagged the rights for the IPL team in 2008 for US $107mn payable over the Rs100.6cr driven by revised next 10 years. In the first IPL season, despite Deccan Chargers finishing last, DCSVL recorded media telecast rights Revenues of Rs56.6cr and Profit of Rs1.6cr owing to fixed central revenues (telecast rights/sponsorships). DCSVL's fortunes completely turned around as Deccan Chargers, under the new leadership of , emerged winners in the second season of IPL in June 2009.

In terms of financials, we expect DCSVL to record a sharp jump in Revenues in FY2010E to Rs100.6cr driven by revised media telecast rights. However, the change of venue for the second season of IPL to resulted in a Revenue loss (gate receipts/sponsorships). Management has claimed Rs50cr from BCCI for the same and expects to receive at least Rs35cr as 'Loss of Profit'. DCSVL also received Rs4.8cr as prize money, which was largely distributed as incentives among the team players. In terms of Profitability, we expect DCSVL's Net Profit to surge to Rs22cr in FY2010E.

Upward revision of media telecast rights for IPL to aid windfall gains for teams

According to media reports, post re-negotiation between BCCI and MSM/Set Max, the telecast rights for the remaining nine years of IPL have been revised significantly higher to US $1.63bn (Rs8,200cr) from the initial deal of US $918mn (Rs3,700cr). This directly enhances the central revenue pool for all the IPL teams without any additional cost leading to higher profits in the ensuing years.

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 6 Deccan Chronicle Holdings

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Exhibit 10: IPL Model - for strong growth in FY2010E (Rs cr) FY2009 FY2010E FY2011E Revenues Central Revenues 24.0 65.6 59.8 Sponsorships 15.8 - 18.3 Other Revenues 16.8 35.0 24.6 Total Revenues 56.6 100.6 102.6 Cost Player Fees 24.0 33.8 28.8 SG&A Expenses 12.9 16.8 17.8 Operating Cost 36.9 50.6 46.6 Amortisation of Franchise Fee 17.1 17.1 17.1 PBT 2.5 32.8 39.0 Tax 0.9 10.8 12.9 PAT 1.6 22.0 26.1 Source: Company, Angel Research; Note: FY2010E Other Revenues indicates 'Loss of Profit' due to change in venue

IPL’s stake sale opportunity We believe that IPL poses an attractive long-term opportunity for the participating franchises may be explored at the right owing to its proven ability to attract significant advertising revenues. From an economic time and value driving a perspective, the model has become significantly attractive post revision of the media telecast re-rating in the DCHL stock rights. In terms of funding, DCHL is well placed to fund the venture through internal accruals. While recent media reports have highlighted the possibility of a stake sale/dilution in DCSVL, management has indicated that fund raising opportunities would only be explored at the right time and value.The next IPL team auction in 2011 is expected to set a benchmark post which DCHL might reconsider its position. Nonetheless, we remain optimistic on IPL's moneymaking prospects and any news flow on the stake sale front will trigger a re-rating in the DCHL stock.

Champions League T20 - Potential Prize money holds upside risk to our estimates Deccan Chargers, on account of being the winner of the second season of IPL, has got direct entry into the Champions League cricket tournament. This tournament an initiative of its three founding members - BCCI, Cricket and Cricket South Africa - is a platform where the world's best domestic teams play against each other. The inaugural tournament will be played over October 8-23, 2009 wherein a total of 23 matches will be played by the various teams. The key attraction is US $6mn pool to be shared by the participating teams and players including US $2.5mn to be awarded to the winning team. We have not factored the same in our model and poses an upside risk to our estimates.

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 7 Deccan Chronicle Holdings

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Odyssey India - Focus on Revenue generation

We have modeled in a Odyssey India, acquired by DCHL in September 2005, is a leisure retail store chain selling books, conservative expansion plan music, stationary, multimedia and magazines. Starting with a 3,500 sq ft store in ADyar, the southern and estimate Revenues to suburb of Chennai, in 1995, Odyssey now occupies 260,409 sq ft of retail space spread over 46 register a CAGR of 19% over stores and 14 cities. The chain receives about five million walk-ins every year. Recently, DCHL FY2009-11E also forayed into the stylish eyewear retail format by opening exclusive designer eyewear stores.

Odyssey incurred significant capex in FY2009 (added 21 stores) and plans to slow down in the near future. Management expects to increase its retail space to 0.5mn sq ft over the next three years to achieve Net Profit Margins of 10% post the scale up. Going ahead, we have modeled in a conservative expansion plan and expect the store count to rise to 61 by FY2011E taking the company's total retail space to almost 330,000 sq ft. We estimate Revenues to register a CAGR of 19% over FY2009-11E to Rs114cr while Earnings are expected to post faster CAGR of 74% to Rs6.2cr (primarily due to low base) in the mentioned period.

Exhibit 11: Odyssey model - Expansion to slow down FY2008 FY2009 FY2010E FY2011E Express (Incl Eyewear) Stores 12 27 30 38 Total sq ft ('000) 13.1 28.2 29.7 37.7 Revenue (Rs cr) 4.2 6.2 7.8 9.5 Regular Stores 12 18 19 23 Total sq ft ('000) 129.1 232.0 244.0 292.0 Revenue (Rs cr) 56.8 74.5 88.3 104.5 Odyssey Total Stores 24 45 49 61 Total sq ft ('000) 142.2 260.2 273.7 329.7 Revenue (Rs cr) 61.0 80.6 96.1 114.0 PAT (Rs cr) (0.5) 2.0 3.7 6.2 Source: Company, Angel Research

Seiger Solutions - Scaling down

Seiger out of focus due to Seiger Solutions houses DCHL's alternate media platforms mainly internet portals. The web site, difficulty in monetising its Papyrusclubs.com (student community forums), its key property, registered a modest jump in internet platform membership from 609 in FY2008 to 1,280 in FY2009 with a student strength of over 1.5mn. Recently, Seiger also started other portals, viz. BigBreaks.com (a job portal which uses an offline-online strategy), WeddingWow.com (match-making services) and Dcdealofday.com (e-commerce portal).

On the financial front, in FY2009, Seiger reported a 37.6% yoy de-growth in Revenue to Rs45cr (Rs71.9cr) and 68% in PAT to Rs10.4cr (Rs32cr) owing to the economic slowdown and consequent impact on Advertising Revenues. Going ahead, management will be shifting focus from Seiger owing to difficulty in monetising its internet portals. Hence, we have modeled a decline in Seiger Revenues over FY2009-11E.

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 8 Deccan Chronicle Holdings

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Newsprint prices collapse

A deep cyclical downturn in Over the past six months, newsprint prices have collapsed. While the newsprint producers have the Newsprint industry, been withholding capacity to restrict the fall, a deep cyclical downturn in the Newsprint industry, demand shifts and structural demand shifts and structural changes continue to push prices lower. According to the 30-lbs changes continue to push benchmark US East coast, newsprint prices have fallen by almost 38% to US $465 from its peak in prices lower February 2009. During the period, imported Canadian newsprint prices (CIF Mumbai) fell by 50% to US $480 from its peak of US $960 in December 2008. Moreover, the Rupee has also depreciated by 8-10% over the last one year further aiding buyers of imported newsprint .

Exhibit 12: Falling newsprint prices to drive significant Margin expansion

1,000 53.0

51.0 900 49.0

800 47.0

45.0 700 43.0

(INR)

Tonne)

600 41.0

(US$ Per 39.0 500 37.0

400 35.0

Oct-07 Oct-04 Apr-07 Oct-08 Apr-04 Oct-05 Apr-08 Apr-05 Oct-06 Apr-09 Apr-06

Jun-07 Jun-04 Jun-08 Jun-05 Jun-09 Jun-06

Feb-07 Feb-08 Feb-05 Feb-09 Feb-06

Dec-06 Aug-07 Dec-07 Aug-04 Aug-08 Dec-08 Dec-04 Aug-05 Aug-09 Dec-05 Aug-06

CIF Mumbai (LHS) US-30 lbs (LHS) INR per US$ (RHS) Source: Crisil, Bloomberg, Angel Research

We expect savings in We expect DCHL to benefit significantly from the collapse in newsprint prices since it imports a newsprint to contribute almost significant 80-85% of its consumption. For FY2010E, we expect DCHL to save almost Rs70cr in 894bp to Margin expansion newsprint costs, despite higher newsprint consumption due to its Bangalore edition, as we model a 31% drop in imported newsprint prices (landed cost) to US $607. Further, we expect savings in newsprint to contribute almost 894bp to Margin expansion as newsprint costs, as a % of Sales, is expected to dip from 42.4% of Standalone Sales in FY2009 to 33.5% in FY2011E.

Exhibit 13: Newsprint cost Model FY2008 FY2009 FY2010E FY2011E Newprint Consumed (tons) 62,354 79,135 87,787 94,064 Total Newsprint Cost (Rs cr) 169.6 322.0 253.1 294.2 Absolute Change (Rs cr) (11.1) 152.5 (69.0) 41.1 Newsprint costs as % of Sales 23.8 42.4 31.7 33.5 Blended Cost (Rs/tonne) 27,196 40,694 28,828 31,273 Exchange Rate (Rs/US$) 40.3 46.5 48.0 47.5 Imptd Newsprint Cost (US$/tonne) 674 882 607 666 Source: Company, Angel Research

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 9 Deccan Chronicle Holdings

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Trouble at AbitibiBowater leads to newsprint prices crash

The sharp fall in imported newsprint prices has largely been on account of the fall-out of the newsprint giant AbitibiBowater, which has sought bankruptcy protection in the US and Canada in April after lenders refused to accept a proposed debt restructuring plan. The company had gone into acquisition mode and acquired almost 45% of the newsprint companies in Europe (including sick companies). However, demand slumped and prices crashed due to over-capacity. Further, post the Olympics, China again started exporting newsprint worsening matters.

Media reports suggest that AbitibiBowater plans to implement a US $70/tonne price increase in two stages - first a US $35/tonne hike in September followed by another in October. However, as it will take time for AbitibiBowater to restructure, and January to March is usually a lean period for newsprint, we expect prices to remain benign over the next couple of quarters before starting to rise again.

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 10 Deccan Chronicle Holdings

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Financial Outlook

Revenue growth muted

Post the management meet and release of the company's FY2009 Annual Report, we have shifted our financials/valuations from standalone to consolidated model owing to better clarity on subsidiaries and to reflect higher contribution from its sports venture (IPL) going ahead.

During FY2009-11E, we expect DCHL to post a CAGR of 11.1% in consolidated Revenues largely driven by higher contribution from subsidiaries as both Advertising (includes contribution from Seiger) and Circulation Revenues are expected to post a muted CAGR of 8.1% (partially due to the decline in Seiger Revenues) and 9.5% respectively, during the mentioned period.

Exhibit 14: IPL to boost Consolidated Revenues in FY2010E Y/E March FY2008 FY2009 FY2010E FY2011E Advertising 809.8 797.0 843.8 930.9 Circulation 44.4 55.8 62.4 66.9 DCSVL (IPL) - 56.6 100.6 102.6 Others # 40.5 58.9 79.6 93.9 Total Sales 894.8 968.3 1,086.4 1,194.3 YoY Growth % Advertising 55.5 (1.6) 5.9 10.3 Circulation 7.1 25.8 11.8 7.2 DCSVL (IPL) - - 77.7 2.1 Others # 59.3 45.3 35.1 17.9 Total Sales 52.3 8.2 12.2 9.9 % of Total Advertising 90.5 82.3 77.7 77.9 Circulation 5.0 5.8 5.7 5.6 DCSVL (IPL) - 5.8 9.3 8.6 Others # 4.5 6.1 7.3 7.9 Source: Company, Angel Research; #Note: Others includes Odyssey (Net of Returns/Inter segment revenues)

DCHL recently announced a We expect Advertising Revenues to pick up in 2HFY2010E driven by the up-tick in economic 20% rate hike across editions, activity and higher spend by sectors like Real Estate, BFSI and Auto. However, we have modeled effective October 2009, post muted 10% CAGR over FY2009-11E in core Print Advertising (Standalone) driven largely by higher achieving a strong circulation contribution from the Bangalore edition and marginal rate hikes as volumes are expected to base in Bangalore remain low. DCHL recently announced a 20% rate hike across editions, effective October 2009, post achieving a strong circulation base in Bangalore. However, we expect the Chennai edition to remain under pressure due to stiff competition from TOI. Key downside risks to our estimates include: 1) absorption of rate hikes, and 2) heightened competitive activity in Bangalore (TOI and DNA) leading to discounts in the card rates.

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 11 Deccan Chronicle Holdings

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Exhibit 15: Bangalore, Ad. rate hikes to drive Advt. growth (Rs cr) FY2008 FY2009 FY2010E FY2011E Andhra Pradesh 543 519 565 628 Chennai 195 217 215 232 Bangalore - 23 44 56 Total Advt. Revenue 738.0 759.1 824.1 916.4 Source: Company, Angel Research; Note: Total Advt Revenue is standalone (excluding Seiger)

Sharp Margin expansion ahead

We have modeled a Margin In our previous notes, we had consistently highlighted that DCHL's Operating Margins had peaked expansion of 1,002bp over in FY2008 at 61.4% and were expected to decline in FY2009 owning to stiffer competition in FY2009-11E driving a robust Chennai, initial losses on account of the Bangalore edition and Financial Chronicle launch and 27.7% CAGR in consolidated higher newsprint prices. Sharp contraction in DCHL's Margins in FY2009 to 31% (1,868bp EBITDA contraction due to newsprint inflation) vindicated our stance.

Going ahead however, we believe DCHL stands to benefit significantly from the steep fall in newsprint prices and higher contribution from IPL (post revision of telecast rights with Sony). Hence, we have modeled in a Margin expansion of 1,002bp over FY2009-11E driving a robust 27.7% CAGR in consolidated EBITDA. We expect savings in newsprint costs to contribute almost 894bp to Margin expansion during the period. In terms of Earnings, we expect DCHL to report a strong 42.8% CAGR over FY2009-11E driven by Margin expansion and sharp drop in Interest costs.

Exhibit 16: High Margins, lower Interest costs to drive Profitability

350 65 304 290 300 60 263 55 250 50 200 45

142 (%)

(Rs cr) 150 40 100 89 81 35 50 41 50 30

0 25 FY2008 FY2009 FY2010E FY2011E

PAT (LHS) Interest Cost (LHS) OPM (RHS) Source: Company, Angel Research

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 12 Deccan Chronicle Holdings

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Balance Sheet concerns fading

During the past several years, high receivables, high debt and volatile cash flows have kept DCHL's stock performance under check. However, management has made serious efforts to curtail the same reflective in its consolidated FY2009 financials.

z DCHL repaid Rs245cr debt in FY2009 on a consolidated basis, excluding Rs330cr notional debt (franchise fees of Rs428cr payable to BCCI adjusted for two upfront payments). Hence, the company is comfortably sitting on a cash surplus of Rs103cr.

z Working capital stood reduced from 61 days to 58 days in FY2009, despite a jump in inventory from 25 days to 68 days (due to rising newsprint prices) aided by sharp reduction in receivables from 101 days to 76 days. On an absolute basis, net working capital remained flat at around Rs150cr.

z During FY2009, DCHL incurred significant capex of Rs696cr owing to capitalisation of the IPL franchise fee, machinery for Bangalore/Financial Chronicle editions and capex on Odyssey expansion (24 to 45 stores). However, going ahead, management has guided for minimal capex (maintenance) yielding higher free cash flows.

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 13 Deccan Chronicle Holdings

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Outlook and Valuation: Re-rating on the cards

Since initiation (April 17, 2008), we had maintained a negative stance on DCHL owing to concerns regarding its poor quality of growth, scalability issues and unsustainable Margins. A sharp fall in the stock price of DCHL by 70% during FY2009 and 32% underperformance vis-à-vis Sensex vindicated our stance. However, we now change our negative stance on the company post the management meet and a shift to consolidated model on account of the following:

z Clear focus on core Print business and IPL: While management has decided to shift its focus from Seiger (expected to post a decline in Revenues) due to difficulty in monetising the internet platform, Odyssey India expects to incur minimal capex during FY2009-11E. Hence, focus is clearly back on core properties (Print and IPL).

z Better Balance Sheet instills confidence: DCHL repaid Rs245cr debt in FY2009, on a consolidated basis, while working capital fell from 61 days to 58 days aided by reduction in receivables from 101 days to 76 days.

z Ongoing Buy-back to cap downside: Post the SEBI approval, management has begun its buy-back program entailing a maximum outlay of Rs180cr at a price not exceeding Rs100 per share. It plans to buy back a minimum of 1cr and a maximum of 3.5cr shares within the stipulated outlay.

z Sharp fall in newsprint prices to aid Margins: We had indicated in our earlier reports that peak levels of US $950 for newsprint were clearly not sustainable. However, we had not modeled for a 50% correction in newsprint prices. For FY2010E, we expect DCHL to save almost Rs70cr in newsprint costs as we have modeled a 31% drop in imported newsprint prices (landed cost) to US $607.

z IPL promising, un-locking could drive re-rating of stock: While we have always been positive on IPL as a property, our initial working on the economics of IPL indicated a longer gestation period. However, revision of media telecast rights (discussed earlier) has made the property significantly more profitable and hence attractive. Moreover, any news flow on stake sale in the IPL venture (Deccan Chargers) could trigger a re-rating in the DCHL stock.

Nonetheless, at Rs114 DCHL is trading at 9.6x FY2011E Earnings, which is at a discount to its peers due to scalability issues as it is characterised as a single publication company with limited reach (only South). However, rising Profitability in IPL (possibility of un-locking) and successful foray into the Bangalore print market warrant a re-rating. Hence, we upgrade DCHL to a Buy, valuing the stock at 12x FY2011E EPS (40% discount to peers like Jagran and HT Media), with a 12-month Target Price of Rs142.

Key downside risks include: 1) heightened competitive activity in Bangalore (TOI/DNA), 2) recovery in newsprint prices, and 3) regulatory changes in IPL model impacting Revenues.

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 14 Deccan Chronicle Holdings

Media

Profit & Loss Statement (Consolidated) Rs crore Balance Sheet (Consolidated) Rs crore Y/E March FY2008 FY2009 FY2010E FY2011E Y/E March FY2008 FY2009 FY2010E FY2011E

Net Sales 895 968 1,086 1,194 SOURCES OF FUNDS % chg 52.3 8.2 12.2 9.9 Equity Share Capital 49.0 49.0 49.0 49.0 Pref Share Capital 101.4 101.4 101.4 101.4 Total Expenditure 346 668 626 704 Reserves& Surplus 1,052.9 1,122.1 1,269.4 1,444.8 EBIDTA 549.1 300.2 460.8 490.0 Shareholders Funds 1,203.3 1,272.4 1,419.7 1,595.2 (% of Net Sales) 61.4 31.0 42.4 41.0 Total Loans 673.0 757.5 667.3 579.5 Other Income 39.6 50.6 45.5 50.8 Minority Interest 1.7 1.7 2.0 2.5 Depreciation 31.7 53.0 63.3 66.6 Deferred Tax Liability (net) 58.1 71.5 71.5 71.5 Total Liabilities 1,936.0 2,103.2 2,160.5 2,248.6 Interest 88.6 80.9 50.1 41.2 APPLICATION OF FUNDS PBT 468.4 216.9 392.9 433.0 Gross Block 784.6 1,441.5 1,566.7 1,631.5 (% of Net Sales) 52.4 22.4 36.2 36.3 Less: Acc. Depreciation 77.6 130.0 176.3 225.8 Extraordinary Expense/(Inc.) - - - - Net Block 707.0 1,311.4 1,390.4 1,405.7 Tax 164.8 74.5 129.7 142.9 Capital Work-in-Progress 58.7 97.5 69.3 61.9 (% of PBT) 35.2 34.4 33.0 33.0 Investments 23.1 23.1 23.1 23.1 Current Assets 1,542.5 1,014.5 1,067.7 1,169.4 Minority Interest 0.0 0.0 0.0 0.0 Current liabilities 406.8 343.4 390.1 411.5 PAT 303.6 142.3 263.2 290.1 Net Current Assets 1,135.7 671.1 677.6 757.9 % chg 83.7 (53.1) 84.9 10.2 Misc Exp 11.4 - - - (% of Net Sales) 33.9 14.7 24.2 24.3 Total Assets 1,936.0 2,103.2 2,160.5 2,248.6

Cash Flow Statement (Consolidated) Rs crore Key Ratios

Y/E March FY2008 FY2009 FY2010E FY2011E Y/E March FY2008 FY2009 FY2010E FY2011E Profit before tax 468.4 216.9 392.9 433.0 Per Share Data (Rs) Depreciation 31.7 53.0 63.3 66.6 EPS 12.4 5.8 10.7 11.8 (Inc)/Dec in Working Capital 153.9 47.8 (65.6) (57.6) Cash EPS 13.7 8.0 13.3 14.6 DPS 3.0 2.2 3.0 4.0 Interest (Net) 57.5 50.6 23.1 10.2 Book Value 49.1 52.0 58.0 65.1 Direct taxes paid 164.8 74.5 129.7 142.9 Operating Ratio Others 0.5 (24.2) (11.2) (6.6) Inventory (days) 25.3 67.7 58.4 54.1 Cash Flow from Operations 547.1 269.5 272.8 302.7 Debtors (days) 101.2 76.2 86.9 91.3 Inc/(Dec) in Fixed Assets 116.6 695.6 97.0 57.4 Creditors (days) 166.0 129.4 131.1 125.8 Free Cash Flow 430.6 (426.1) 175.7 245.3 Returns (%) (Inc)/Dec in Investments (0.0) - - - RoE 25.2 11.2 18.5 18.2 Issue of Equity 99.4 (11.4) - - RoCE 26.7 11.8 18.4 18.8 Inc./(Dec.) in loans 264.6 84.6 (90.3) (87.8) ROIC (Pre Tax) 54.4 15.6 23.8 24.6 Dividend Payout 28.5 45.3 32.7 39.5 Dividend Paid (Incl. Tax) 86.5 64.4 86.0 114.6 Valuation Ratio (x) Interest / Dividend (Net) 57.5 50.6 23.1 10.2 P/E 9.2 19.6 10.6 9.6 Cash Flow from Financing 220.1 (41.8) (199.3) (212.6) P/E (Cash EPS) 8.3 14.3 8.5 7.8 Inc./(Dec.) in Cash 650.7 (467.9) (23.6) 32.8 P/BV 2.3 2.2 2.0 1.8 Opening Cash balances 334.8 985.4 517.5 494.0 EV / Sales 2.8 3.1 2.7 2.4 Closing Cash balances 985.4 517.5 494.0 526.7 EV / EBITDA 4.5 10.1 6.4 5.8

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 15 Deccan Chronicle Holdings

Media

Fund Management & Investment Advisory ( 022 - 3952 4568) P. Phani Sekhar Fund Manager - (PMS) [email protected] Siddarth Bhamre Head - Derivatives and Investment Advisory [email protected] Devang Mehta AVP - Investment Advisory [email protected] Research Team ( 022 - 3952 4568) Hitesh Agrawal Head - Research [email protected] Sarabjit Kour Nangra VP-Research, Pharmaceutical [email protected] Vaibhav Agrawal VP-Research, Banking [email protected] Vaishali Jajoo Automobile [email protected] Harit Shah IT, Telecom [email protected] Shailesh Kanani Infrastructure, Real Estate [email protected] Anand Shah FMCG , Media [email protected] Deepak Pareek Oil & Gas [email protected] Puneet Bambha Capital Goods, Engineering [email protected] Sushant Dalmia Pharmaceutical [email protected] Param Desai Logistics, Shipping [email protected] Sageraj Bariya Fertiliser, Mid-cap [email protected] Viraj Nadkarni Retail [email protected] Jai Sharda Mid-cap [email protected] Amit Vora Research Associate (Oil & Gas) [email protected] Laxmikant Waghmare Research Associate (Metals & Mining, Cement) [email protected] V Srinivasan Research Associate (Power, Mid-cap) [email protected] Aniruddha Mate Research Associate (Infra, Real Estate) [email protected] Shreya Gaunekar Research Associate (Automobile) [email protected] Mihir Salot Research Associate (Logistics, Shipping) [email protected] Chitrangda Kapur Research Associate (FMCG, Media) [email protected] Jaya Agrawal Jr. Derivative Analyst [email protected] Amit Bagaria PMS [email protected] Sandeep Wagle Chief Technical Analyst [email protected] Ajit Joshi AVP Technical Advisory Services [email protected] Brijesh Ail Manager - Technical Advisory Services [email protected] Vaishnavi Jagtap Sr. Technical Analyst [email protected] Milan Sanghvi Sr. Technical Analyst [email protected] Mileen Vasudeo Technical Analyst [email protected] Krunal Dayma Technical Analyst [email protected] Sanket Padhye AVP Mutual Fund [email protected] Pramod Rathod Research Associate (MF) [email protected] Poonam Jangid Research Associate (MF) [email protected] Commodities Research Team Amar Singh Research Head (Commodities) [email protected] Samson P Sr. Technical Analyst [email protected] Anuj Gupta Sr. Technical Analyst [email protected] Girish Patki Sr. Technical Analyst [email protected] Abhishek Chauhan Technical Analyst abhishek [email protected] Commodities Research Team (Fundamentals) Badruddin Sr. Research Analyst (Agri) [email protected] Reena Walia Research Analyst ( Base Metals, Energy Complex) [email protected] Vedika Narvekar Research Analyst ( Agri) vedika.narvekar @angeltrade.com Nalini Rao Research Analyst (Agri) [email protected] Bharathi Shetty Research Editor [email protected] Dharmil Adhyaru Assistant Research Editor [email protected] Bharat Patil Production [email protected] Dilip Patel Production [email protected]

Research & Investment Advisory: Acme Plaza, 3rd Floor ‘A’ wing, M.V. Road, Opp Sangam Cinema, Andheri (E), Mumbai - 400 059

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

SeptemberJanuary 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 16 Deccan Chronicle Holdings

Media Corporate & Marketing Office : 612, Acme Plaza, M.V. Road, Opp Sangam Cinema, Andheri (E), Mumbai - 400 059 Tel : (022) 3941 3940 / 4000 3600 NRI Helpdesk : e-mail : [email protected] Tel : (022) 4000 3622 / 4026 2700 Investment Advisory Helpdesk : e-mail : [email protected] Tel : (022) 3958 4000 Commodities : e-mail : [email protected] Tel : (022) 3081 7400 PMS : e-mail : [email protected] Tel: (022) 3953 2800 Feedback : e-mail : [email protected] Tel : (022) 2835 5000

Regional Offices:

Ahmedabad - Tel: (079) 3941 3940 Indore - Tel: (0731) 3941 394 - Tel: (0712) 3941 394 Rajkot - Tel :(0281) 3941 394

Bengaluru - Tel: (080) 3941 3940 Jaipur - Tel: (0141) 3941 394 Nashik - Tel: (0253) 3941 394 Surat - Tel: (0261) 3941 394

Chennai - Tel: (044) 3941 3940 Kanpur - Tel: (0512) 3941 394 Mumbai (Goregoan) Tel: (022) 2879 0411-15 Visakhapatnam - Tel :(0891) 3941 394

Cochin - Tel: (0484) 3941 394 Kolkata - Tel: (033) 3941 3940 Mumbai (Powai) - Tel: (022)3952 6500

Coimbatore - Tel: (0422) 3941 394 Lucknow - Tel: (0522) 3941 394 New Delhi - Tel: (011) 3941 3940

Hyderabad - Tel: (040) 3941 3940 Ludhiana - Tel: (0161) 3941 394 Pune - Tel: (020) 3941 3940

Private Client Group Offices: Sub - Broker Marketing:

Ahmedabad (C. G. Road) - Tel: (079) 3982 9934 Surat - Tel: (0261) 3071 600 Rajkot (Race course) - Tel: (0281) 2490 847 Powai - Tel: (022) 3952 6500

Branch Offices:

Andheri (Lokhandwala) - Tel: (022) 2639 2626 Ahmeda. (Ramdevnagar) - Tel : (079) 4024 3842 / 43 Jaipur - (Rajapark) Tel: (0141) 3057 900 / 99833 40004 Pune (Aundh) - Tel: (020) 4104 1900

Andheri (W) - Tel: (022) 2635 2345 / 6668 0021 Ahmedabad (Sabarmati) - Tel : (079) 3091 6100 / 01 Jalgaon - Tel: (0257) 2234 832 Pune (Camp) - Tel: (020) 3092 1800

Bandra (W) - Tel: (022) 2655 5560 / 70 Ahmedabad (Satellite) - Tel: (079) 4000 1000 Jamnagar(Indraprashta) - Tel: (0288) 3941 394 Pune - (kalyani Nagar) Tel: (020) 6620 6591 / 6620 6595

Bandra (W) - Tel: (022) 6643 2694 - 99 Ahmedabad (Shahibaug) -Tel: (079)3091 6800 / 01 Jamnagar (Cross Word) - Tel: (0288) 2751 118 Pune (Kothrud) Tel: (020) 4104 5400

Borivali (W) - Tel: (022) 3952 4787 Amreli - Tel: (02792) 228 800/231039-42 Jamnagar (Moti Khawdi) - Tel: (0288) 2846 026 Rajamundhry - Tel: (0883) 3941 394

Borivali (Punjabi Lane) - Tel: (022) 3951 5700. Amritsar - Tel: (0183) 3941 394 Jamnagar(Madhav Plaza) - Tel: (0288) 2665 708 Rajkot (Ardella) Tel.: (0281) 2926 568

Chembur (Swastik) - Tel: (022) 6703 0210 / 11 /12 Anand - Tel : (02692) 398 400 / 3 Jodhpur - Tel: (0291) 3941 394 / 99280 24321 Rajkot (University Rd.) - Tel: (0281) 2331 418

Chembur - (Basant) - Tel:(022) 022) 6156 1111 / 01 Ankleshwar - Tel: (02646) 398 200 Junagadh - Tel : (0285) 3941 3940 Rajkot - (Bhakti Nagar) Tel: (0281) 2361 935

Fort - Tel: (022) 3958 1887 Baroda - Tel: (0265) 6635 100 / 2226 103 Keshod - Tel: (02871) 234 027 / 233 967 Rajkot - (Indira circle) Tel : 99258 84848

Ghatkopar (E) - Tel: (022) 3955 8400/2510 1525 Baroda (Akota) - Tel: (0265) 2355 258 / 6499 286 Kolhapur - Tel: (0231) 6632 000 Rajkot (Orbit Plaza) - Tel: (0281) 3983 485

Kalbadevi - Tel: (022) 2243 5599 / 2242 5599 Baroda (Manjalpur) - Tel: (0265) 6454280-3 Kolkata (N. S. Rd) - Tel: (033) 3982 5050 Rajkot (Pedak Rd) - Tel: (0281) 3985 100

Kandivali (W) - Tel: (022) 2867 3800/2867 7032 Bengaluru - Tel: (080) 4072 0800 - 29 Kolkata (P. A. Shah Rd) - Tel: (033) 3001 5100 Rajkot (Ring Road)- Mobile: 99245 99393

Kandivali - Tel: (022) 4245 1300 Bhavnagar - Tel: (0278) 3941 394 Kota - Tel : (0744) 3941 394 Rajkot (Star Chambers) - Tel : (0281)3981 200

Malad (E) - Tel: (022) 2880 4440 Bhavnagar (Shastrinagar)- Mobile: 92275 32302 Madurai Tel: (0452) 3941 394 Rajkot - (Star Chambers) - Tel : (0281) 2225 401-3

Malad (Natraj Market) - Tel:(022) 28803453 / 24 Bhilwara - (01482) 398 350 Mangalore - Tel: (0824) 3982 140 Salem - Tel: (0427) 3941 394

Masjid Bander - Tel: (022) 2345 5130 /1 / 8 / 42 /28 Bhopal - Tel :(0755) 3941 394 Mansarovar - Tel:(0141) 3057 700/99836 74600 - Tel : (040) 3093 2600

Mulund (W) - Tel: (022) 2562 2282 Bikaner - Tel: (0151) 3941 394 / 98281 03988 Mehsana - Tel: (02762) 645 291 / 92 Surat (Mahidharpura) - Tel: (0261) 3092 900

Nerul - Tel: (022) 2771 9012 - 17 Chandigarh - Tel: (0172) 3092 700 Mysore - Tel: (0821) 4004 200 - 30 Surat - (Parle Point) - Tel : (0261) 3091 400

Powai (E) - Tel: (022) 3952 5887 Deesa - Mobile: 97250 01160 Nadiad - Tel : (0268) - 2527 230 / 34 Surat (Ring Road) - Tel : (0261) 3071 600

Sion - Tel: (022) 3952 7891 Erode - Tel: (0424) 3982 600 Nagaur - Tel: (01582) 244 648 Surendranagar - Tel : (02752) 223305

Thane (W) - Tel: (022) 2539 0786 / 0650 / 1 Faridabad - Tel: (0129) 3984 000 Nashik - Tel: (0253) 3011 500 / 1 / 11 Tirupur - (0421) 4302 800

Vashi - Tel: (022) 2765 4749 / 2251 Gajuwaka - Tel: (0891) 3987 100 - 30 New Delhi (Bhikaji Cama) - Tel: (011) 41659711 Udaipur - (0294) 3941 394

Vile Parle (W) - Tel: (022) 2610 2894 / 95 Gandhinagar - Tel: (079) 4010 1010 - 31 New Delhi (Lawrence Rd.) - Tel: (011) 3262 8699 / 8799 Valsad - Tel - (02632) 645 344 / 45

Wadala - Tel: (022) 2414 0607 / 08 Gandhidham - Tel: (02836) 237 135 New Delhi (Pitampura) - Tel: (011) 4751 8100 Vapi - Tel: (0260) 3941 394

Agra - Tel: (0562) 4037200 Gondal - Tel: (02825) 398 200 New Delhi (Nehru Place) - Tel: (011) 3982 0900 Varachha - (0261) 3091 500

Ajmer - Tel: (0145) 3941 394 Ghaziabad - Tel: (0120) 3980 800 New Delhi (Preet Vihar) - Tel: (011) 4310 6400 Varanasi - Tel: (0542) 2221 129, 3058 066

Alwar - Tel: (0144) 3941 394 / 99833 60006 Gurgaon - Tel: (0124) 3050 700 Noida - Tel : (0120) 4639 900 / 1 / 9 Vijayawada - Tel :(0866) 3984 600

Ahmeda. (Bapu Nagar) - Tel : (079) 3091 6900 - 02 Himatnagar - Tel: (02772) 241 008 / 241 346 Palanpur - Tel: (02742) 308 060 - 63 Warangal - Tel: (0870) 3982 200

Ahmedabad (C. G. Road) - Tel: (079) 4021 4023 Hyderabad - A S Rao Nagar Tel: (040) 4222 2070-5 Patan - Tel: (02766) 222 306

Ahmeda. (Gurukul) - Tel: (079) 3011 0800 / 01 Hubli - Tel: (0836) 4267 500 - 22 Porbandar - Tel : (0286) 3941 394

Ahmedabad (Kalupur) - Tel: (079) 3041 4000 / 01 Indore - Tel: (0731) 3049 400 Porbandar (Kuber Life Style) - Mob.-98242 53737

Ahmedabad (Maninagar) - Tel: (079) 3981 7430 / 1 Indore - Tel: (0731) 4238 600 Pune - (Pentagon) Tel : (020) 3093 4400 / 3052 3217

Central Support & Registered Office:G-1, Akruti Trade Centre, Road No. 7, MIDC Marol, Andheri (E), Mumbai - 400 093 Tel : 2835 8800 / 3083 7700

JanuarySeptember 30, 22, 2008 2009 For Private Circulation Only - Sebi Registration No : INB 010996539 17