RESULT UPDATE

EICHER MOTORS Superior product mix propels performance

India Equity Research| Automobiles

Eicher Motors’ (EIM) Q2CY13 consolidated PAT of INR923mn was 23% EDELWEISS 4D RATINGS

ahead of our estimate primarily due to higher sales in the high-margin Absolute Rating HOLD bus segment. We like the company for its strong product portfolio, both Rating Relative to Sector Underperformer in CVs and the niche leisure biking segment. We have broadly maintained Risk Rating Relative to Sector Medium our earnings estimates as minor volume cuts in VE Commercial Vehicles Sector Relative to Market Underweight

(VECV) offset higher expected volumes in Royal Enfield (RE) and maintain ‘HOLD’ with target price of INR3,521 (INR3,453 earlier). MARKET DATA (R: EICH.BO, B: EIM IN)

CMP : INR 3,200 Royal Enfield, VE Commercial Vehicles fuel surge Target Price : INR 3,521 EIM’s Q2CY13 consolidated PAT of INR923mn zoomed 23% ahead of our estimate 52-week range (INR) : 3,980 / 2,027 propelled by higher sales in the high-margin bus segment. Consolidated revenues were Share in issue (mn) : 27.0 up 5% EBITDA was up 19% and PAT was up 22% on a YoY basis. Standalone revenues M cap (INR bn/USD mn) : 86 / 1,411 were up 50% YoY and 14% QoQ, while EBITDA was up 75% YoY and 15% QoQ. Avg. Daily Vol.BSE/NSE(‘000) : 27.8 Standalone margins expanded to 17.8% from 15.3% in Q2CY13 on lower expense ratio

on operating leverage. VECV margins surprised at 7.6% versus our estimate of 5.5% on SHARE HOLDING PATTER N (%)

higher proportion of high margin bus segment in the volumes. Current Q4FY13 Q3FY13

Promoters * 55.2 55.2 55.2

New plants commence operations; new launches on the anvil MF's, FI's & BK’s 8.9 11.8 13.7 The VECV JV’s new engine plant commenced operations in July 2013 and the new RE FII's 16.0 12.9 10.7 plant at Oragadam (Chennai) commenced production in April 2013. RE production run Others 19.9 20.1 20.4 rate for July was 16k units and given that ~75k units were produced in H1CY13, the * Promoters pledged shares : NIL (% of share in issue) company is on track to attain its full year guidance of 175k units. Waiting period for RE

has come off marginally, even as absolute order back log increased on higher PRIC E PERFORMANCE (%) production base. EIM is looking to globally launch its new bike in September, which Stock Nifty EW Auto Index alongwith a healthy order backlog will lead volumes in H2CY13/CY14E. 1 month (11.5) (5.9) 4.6

Outlook and valuations: Well-priced; maintain ‘HOLD’ 3 months 1.9 (8.7) 2.1 12 months 54.2 3.4 25.5 We have broadly maintained our earnings estimates as minor volume cuts in VECV

broadly offset higher volumes in RE. We arrive at our SOTP-based TP of INR3,521 valuing VECV business at 7.5x EV/EBITDA, RE business at 12.5x EV/EBITDA and the engine business at 8x EV/EBITDA. While we like EIM for its strong balance sheet, credible management and an attractive product portfolio, we maintain ‘HOLD/Sector Underperformer’ given the sharp run up in prices.

Financials (INR mn) Year to Dec. Q2CY13 Q2CY12 % change Q1CY13 % change CY12 CY13E CY14E Total income 16,699 15,850 5.4 17,243 (3.2) 63,899 72,035 97,183 EBITDA 1,662 1,395 19.2 1,705 (2.5) 5,490 7,301 12,041 Aashiesh Agarwaal, CFA Adj. net profit 1,258 1,126 11.8 1,328 (5.2) 4,749 5,980 9,656 +91 22 4063 5491 Dil. EPS (INR) 34.2 28.1 21.5 36.3 (5.7) 120.1 162.5 250.4 [email protected]

Dil. P/E (x) 26.6 19.7 12.8 EV/EBITDA (x)* 13.5 9.4 4.9 * Adjusted for Volvo's share August 8, 2013 Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL , Thomson First Call, Reuters and Factset. Edelweiss Securities Limited

Automobiles

Conference call: Key highlights

Royal Enfield

• Q2CY13 witnessed the company’s best-ever quarterly sales of 40,040 units.

• Production was at 16,000 units in July and expected production for CY13 is 175,000 units. New plant at Oragadam (Chennai) produced 3,000 units in July.

• The company has guided for production of 250,000 units in CY14.

• The company will continue to invest in the business and is looking for further capacity expansion.

• Number of RE dealerships stands at ~275 versus 260 in the previous quarter.

• While the order book has increased, waiting period has come off marginally from ~6 months as monthly production run rate has increased from ~13k vehicles to ~16k vehicles.

• Median age of buyers is in mid-20s with a wide dispersion in the same.

• Expects global launch of its new model Continental GT in September.

• The company is targeting to be a global play in mid-size motorcycling.

Volvo

• Eicher sold 121units of Volvo trucks in Q2CY13, a decline of 20% YoY.

• Eicher has invested INR13.0bn; it will invest INR12.0bn in the coming two years.

Engine business

• The company’s engine business is in start up phase with no significant revenue or profit contribution.

• Current production capacity is 25,000 annually, and ramp up will be gradual.

• Total capacity expected to build to 100,000 engines, of which ~35,000 will be for the Eicher brand.

• Inaugurated a new engine manufacturing plant during the quarter. It is the only plant in the country manufacturing Euro 6 compliant engines.

• Billing for engine exports will be USD-denominated.

CVs

• Realisations were higher in the quarter due to higher mix of buses in volumes (~28% versus 16%) where margins / ASPs are higher.

• Bus segment grew 20% against industry decline of 2%. EIM has 16.6% market share now against 13.9% last year.

Exports

• Exports were 20% lower than last year, while the industry declined 30%.

• Emerging markets of Africa, Mid-East and South-East Asia are key target markets. Long- term goal is to have a premium mass market brand for these markets.

2 Edelweiss Securities Limited Eicher Motors

Table 1: Summary valuation INR mn CY12E CY13E CY14E Sales VECV (Ex-engine) 52,976 54,060 69,887 Standalone 10,493 16,600 21,796 Total 63,469 70,660 91,683 EBIDTA VECV (Ex- Engine) 4,036 4,491 7,633 Standalone 1,454 2,756 3,749 Total 5,491 7,246 11,381 Target multiple (EV/EBIDTA) VECV (Truck) 9.6 8.5 7.5 Standalone 16.0 14.1 12.5 Target EV (INR mn, adjusted to Volvo's share of 45.6%) VECV (Truck) 21,028 20,704 31,141 Standalone 23,212 38,922 46,861 Engine business - 2,542 2,872 Total 44,240 62,168 80,874 Add: Net cash (INR mn) (10,637) (15,144) (21,033) Less: 30% Holdco discount (7,446) (10,601) (14,723) Target market cap (INR mn) 51,686 72,769 95,597 Share cap. (Nos mn) 27.0 27.1 27.1 Value per share (INR) 1,915 2,680 3,521 Source: Edelweiss research

Table 2: Edelweiss Vs consensus CY13E CY14E Particulars Edelweiss Consenses % var Edelweiss Consenses % var Sales (INR mn) 72,035 73,169 (1.5) 97,183 98,385 (1.2) EBITDA (INR mn) 7,301 7,243 0.8 12,041 11,654 3.3 EBITDA (%) 10.1 9.9 2.4 12.4 11.8 4.6 EPS (INR) 162.5 152.1 6.8 250.4 208.2 20.3 Source: Bloomberg, Edelweiss research

3 Edelweiss Securities Limited Automobiles

Financial snapshot (Standalone) Financial Analysis Year to December Q2CY13 Q2CY12 % Change Q1CY13 % Change CY12 CY13E CY14E Total income 3,818 2,551 49.7 3,338 14.4 10,493 16,600 21,796 Net RM cost 2,449 1,645 48.8 2,113 15.9 6,761 10,607 13,731 Employee expenses 272 192 41.9 235 16.0 789 1,162 1,482 Other expenses 417 325 28.3 400 4.2 1,489 2,075 2,833 EBIDTA 681 389 74.9 591 15.2 1,454 2,756 3,749 Other income 77 49 56.1 682 (88.7) 458 504 554 Interest 0 0 (25.0) 1 (40.0) 3 20 20 Depreciation 75 40 87.3 60 25.9 172 214 247 Total tax 156 75 107.9 240 (35.1) 290 484 646 Adjusted PAT 526 323 62.9 972 (45.9) 1,448 2,541 3,390 PAT after E/o and minority 526 323 62.9 972 (45.9) 1,448 2,541 3,390

As % of total income Year to December Q2CY13 Q2CY12 bps change Q1CY13 bps change CY12 CY13E CY14E Raw material 64.1 64.5 (37) 63.3 84 64.4 63.9 63.0 Staff costs 7.1 7.5 (39) 7.0 10 7.5 7.0 6.8 Other expenses 10.9 12.7 (181) 12.0 (107) 14.2 12.5 13.0 EBIDTA 17.8 15.3 257 17.7 13 13.9 16.6 17.2 Adjusted PAT 13.8 12.7 112 29.1 (1,534) 13.8 15.3 15.6 PAT after E/o and Minority 13.8 12.7 112 29.1 (1,534) 13.8 15.3 15.6 Tax rate 22.9 18.9 401 19.8 305 16.7 16.0 16.0 Financial snapshot (Subs - VECV and Others) Financial Analysis Year to December Q2CY13 Q2CY12 % change Q1CY13 % change CY12 CY13E CY14E Total income 12,881 13,299 (3.1) 13,905 (7.4) 53,406 55,435 75,387 Net RM cost 9,223 9,673 (4.6) 9,871 (6.6) 39,091 41,299 56,164 Employee expenses 1,031 969 6.4 1,038 (0.6) 3,784 3,492 4,146 Other expenses 1,645 1,651 (0.4) 1,883 (12.6) 6,495 6,098 6,785 EBIDTA 981 1,006 (2.4) 1,114 (11.9) 4,036 4,546 8,293 Other income 134 257 (47.8) (238) (156.3) 909 1,091 1,472 Interest 12 7 65.3 6 108.8 35 25 25 Depreciation 221 147 50.8 215 2.9 650 964 1,157 Total tax 151 306 (50.8) 300 (49.8) 958 1,208 2,318 Adjusted PAT 732 803 (8.8) 356 105.8 3,301 3,439 6,266

As % of total income Year to December Q2CY13 Q2CY12 bps change Q1CY13 bps change CY12 CY13E CY14E Raw material 71.6 72.7 (113) 71.0 62 73.2 74.5 74.5 Staff costs 8.0 7.3 71 7.5 54 7.1 6.3 5.5 Other expenses 12.8 12.4 36 13.5 (77) 12.2 11.0 9.0 EBIDTA 7.6 7.6 6 8.0 (39) 7.6 8.2 11.0 Adjusted PAT 5.7 6.0 (35) 2.6 312 6.2 6.2 8.3 Tax rate 17.1 27.6 (1,053) 45.8 (2,871) 22.5 26.0 27.0

4 Edelweiss Securities Limited Eicher Motors

Financial snapshot (Consol) (INR mn) Year to December Q2CY13 Q2CY12 % change Q1CY13 % change CY12 CY13E CY14E Net revenues 16,699 15,850 5.4 17,243 (3.2) 33,942 72,035 97,183 Raw material costs 11,672 11,318 3.1 11,984 (2.6) 23,656 51,906 69,895 Staff costs 1,303 1,161 12.2 1,272 2.4 2,575 4,654 5,628 Other expenses 2,061 1,975 4.4 2,283 (9.7) 4,344 8,173 9,618 EBITDA 1,662 1,395 19.2 1,705 (2.5) 3,367 7,301 12,041 Depreciation & amortization 296 187 58.6 275 7.9 571 1,178 1,403 Other income 211 306 (31.0) 444 (52.5) 655 1,594 2,026 Interest 12 8 60.5 6 96.8 18 45 45 Total Tax 307 381 (19.5) 541 (43.3) 847 1,692 2,963 PAT 1,258 1,126 11.8 1,328 (5.2) 2,586 5,980 9,656 Minority interest (335) (366) NA (348) NA (683) 1,568 2,857 Profit after tax and min. int. 923 760 21.5 979 (5.7) 1,903 4,412 6,799

As % of net revenues Raw material 69.9 71.4 69.5 139.4 72.1 71.9 Employee cost 7.8 7.3 7.4 15.2 6.5 5.8 Other expenses 12.3 12.5 13.2 25.6 11.3 9.9 EBITDA 10.0 8.8 9.9 19.8 10.1 12.4 Adjusted net profit 5.5 4.8 5.7 11.2 6.1 7.0 Reported net profit 7.5 7.1 7.7 15.2 8.3 9.9 Tax rate 19.6 25.3 28.9 48.5 22.1 23.5

5 Edelweiss Securities Limited Automobiles

Company Description Incorporated in 1982, Eicher is the flagship company of the Eicher Group in India and a leading player in the Indian motorcycle and commercial vehicle (CV) segments. Eicher manufactures and markets the motorcycle under the iconic brand name ‘Royal Enfield’. The CV segment operates under a JV called VE Commercial Vehicles (VECV).

Investment Theme Despite the near term pain, Company offers strong volume and earnings growth visibility in CY14. Market share gain in commercial vehicle business, engine supply to Volvo and strong demand for niche motorcycle division provides solid volume growth visibilities over next three years. Strong balance sheet, credible partner Volvo and management provides additional comfort.

Key risks Execution risk Major execution risk involves start of production as per schedule and acceptability of new products in new geographies.

Economic slowdown Economic slow-down has been sharper than our expectations which have adversely affected truck demand. We expect removal of mining ban and improvement in freight availability during harvesting season should lift sentiments. However any further slow-down in economy could delay the recovery and is a major risk to our assumption.

6 Edelweiss Securities Limited Eicher Motors

Financial Statements

Key Assumptions Income statement (INR mn) Year to December CY11 CY12 CY13E CY14E Year to December CY11 CY12 CY13E CY14E Macro Income from operations 56,844 63,899 72,035 97,183 GDP(Y -o-Y %) 6.2 5.0 5.6 6.5 Materials costs 41,179 45,852 51,906 69,895 Inflation (Avg) 8.9 7.4 5.2 6.0 Employee costs 3,456 4,573 4,654 5,628 Repo rate (exit rate) 8.5 7.5 6.8 6.0 Total SG &A expenses 6,317 7,984 8,173 9,618 USD/INR (Avg) 48.0 54.5 58.0 56.0 Total operating expenses 50,951 58,409 64,734 85,142 Sector EBITDA 5,894 5,490 7,301 12,041 Motorcycle - dom. vol. (% YoY) 11.9 6.0 3.4 6.5 Depreciation and amortisation 640 822 1,178 1,403 MHCV - domestic vol (% YoY) 8.2 (23.2) 1.0 12.0 EBIT 5,254 4,669 6,123 10,638 Steel prices (INR/t) 38,500 39,200 39,200 39,200 Non -Operational Income 1,425 1,366 1,594 2,026 Aluminium prices (USD/t) 2,316 2,300 2,400 2,400 Interest expenses 77 38 45 45 Company Profit before tax 6,602 5,997 7,672 12,620 Revenue assumptions Provision for tax 1,628 1,249 1,692 2,963 Volume growth (% YoY) Net profit 4,974 4,749 5,980 9,656 Motorcycle - domestic volume (% YoY) 44.3 54.0 50.0 25.0 Minority interest 1,886 1,506 1,568 2,857 MHCV - domestic vol (% YoY) 27.2 1.3 (4.0) 18.0 Profit after minority interest 3,088 3,243 4,412 6,799 LCV - dom. vol. (% YoY) 28.7 0.9 7.5 25.3 Diluted EPS (INR) 114.4 120.1 162.5 250.4 Average price (INR) Dividend payout (%) 14.0 16.6 15.3 11.9 Royal Enfield (INR) 88,805 94,622 99,354 104,321

Royal Enfield (% YoY) 6.8 6.6 5.0 5.0 Common size metrics VECV (INR) 819,066 925,453 949,059 992,062 Year to December CY11 CY12 CY13E CY14E VECV (% YoY) 15.4 13.0 2.6 4.5 Materials costs 72.4 71.8 72.1 71.9 Cost assumptions Employee expenses 6.1 7.2 6.5 5.8 RM cost/vehicle 332,934 282,553 239,004 257,686 S G & A expenses 11.1 12.5 11.3 9.9 Employee cost/vehicle 27,939 28,177 21,431 20,751 EBITDA margins 10.4 8.6 10.1 12.4 EBITDA/vehicle 47,650 33,832 33,619 44,394 Adj. net margins 8.8 7.4 8.3 9.9 Financial assumptions

Tax rate (%) 24.7 20.8 22.1 23.5 Growth ratios (%) Dividend payout ratio (%) 16.3 19.4 17.8 13.8 Year to December CY11 CY12 CY13E CY14E Balance sheet assumptions Revenues 28.6 12.4 12.7 34.9 Net borrowings (INR mn) (585) 12 (4) - EBITDA 54.6 (6.8) 33.0 64.9 Capex (INR mn) 4,694 7,216 1,521 2,000 PBT 58.1 (9.2) 27.9 64.5 Debtor days 19 23 23 21 EPS 63.1 5.0 35.3 54.1 Inventory days 33 36 38 37

Payable days 70 70 75 72 Cash conversion cycle (days) (18) (11) (14) (15)

7 Edelweiss Securities Limited Automobiles

Balance sheet (INR mn) Cash flow metrics As on 31st December CY11 CY12 CY13E CY14E Year to December CY11 CY12 CY13E CY14E Equity capital 270 270 270 270 Operating cash flow 4,050 4,825 9,019 12,004 Reserves & surplus 14,661 17,279 20,907 26,765 Investing cash flow (3,380) (7,732) (3,417) (3,395) Shareholders funds 14,931 17,549 21,177 27,035 Financing cash flow (1,137) (973) (788) (941) Minority interest (BS) 8,377 9,485 11,053 13,910 Net cash flow (466) (3,880) 4,814 7,668 Short term debt 366 384 380 380 Capex (4,694) (7,216) (1,521) (2,000) Long term debt 6 - - - Dividends paid (502) (628) (784) (941) Borrowings 371 384 380 380

Deferred tax liability 645 1,232 1,232 1,232 Profitability & efficiency ratios Sources of funds 24,324 28,649 33,841 42,557 Year to December CY11 CY12 CY13E CY14E Total net fixed assets 8,567 14,962 15,304 15,901 ROAE (%) 22.7 20.0 22.8 28.2 Non current investments 1 1 1 1 ROACE (%) 29.9 22.8 24.7 33.2 Current Investments 5,126 6,385 8,235 9,585 Inventory day 33 36 38 37 Cash and equivalents 11,915 8,035 12,849 20,517 Debtors days 19 23 23 21 Inventories 4,280 4,888 5,979 8,036 Payable days 70 70 75 72 Sundry debtors 3,446 4,459 4,688 6,359 Cash conversion cycle (days) (18) (11) (14) (15) Loans and advances 3,823 4,707 5,517 7,635 Current ratio 0.9 1.0 0.9 0.9 Other current assets 777 1,279 969 1,182 Debt/EBITDA 0.1 0.1 0.1 - Total current assets (ex cash) 12,325 15,333 17,153 23,212 Fixed asset turnover (x) 8.7 5.4 4.8 6.2 Trade payable 7,941 9,547 11,828 15,867 Debt/Equity - - - - Others current liabilities 5,669 6,519 7,873 10,794

Total current liabilities & 13,610 16,066 19,702 26,660 Operating ratios Net current assets (ex cash) (1,285) (733) (2,549) (3,448) Year to December CY11 CY12 CY13E CY14E Uses of funds 24,324 28,649 33,841 42,557 Total asset turnover 2.5 2.4 2.3 2.5 Book value per share (INR) 553.2 650.2 780.0 995.8 Fixed asset turnover 8.7 5.4 4.8 6.2 Equity turnover 4.2 3.9 3.7 4.0

Free cash flow (INR mn)

Year to December CY11 CY12 CY13E CY14E Valuation parameters Net profit 3,088 3,243 4,412 6,799 Year to December CY11 CY12 CY13E CY14E Depreciation 640 822 1,178 1,403 Diluted EPS (INR) 114.4 120.1 162.5 250.4 Others (3,723) (3,512) (7,406) (9,102) Y-o-Y growth (%) 63.1 5.0 35.3 54.1 Gross cash flow 4,046 4,273 10,835 12,903 CEPS (INR) 138.1 150.6 207.1 303.9 Less: Changes in WC (4) (552) 1,816 900 Diluted PE (x) 28.0 26.6 19.7 12.8 Operating cash flow 4,050 4,825 9,019 12,004 Price/BV (x) 5.8 4.9 4.1 3.2 Less: Capex 4,694 7,216 1,521 2,000 EV/Sales (x) 1.2 1.2 1.0 0.6 Free cash flow (644) (2,391) 7,498 10,004 EV/Sales adjusted for Volvo 2.7 2.3 1.9 1.3 EV/EBITDA (x) 13.2 14.9 10.5 5.9

EV/EBITDA adjusted for Volvo 25.5 24.3 16.1 9.6 Market Capitalisation 86,368 86,368 86,368 86,368

Peer comparison valuation Market cap Diluted PE (X) EV/EBITDA (X) Price/BV (X) Name (USD mn) CY13E CY14E CY13E CY14E CY13E CY14E Eicher Motors 1,411 19.7 12.8 10.5 5.9 4.1 3.2 Ashok Leyland 540 9.6 4.5 6.9 4.5 0.7 0.7 Bajaj Auto 8,362 14.6 13.0 10.7 8.9 5.3 4.3 Tata Motors Ltd 13,235 7.6 6.6 4.1 3.4 1.9 1.6 Median - 12.1 9.7 8.7 5.2 3.0 2.4 AVERAGE - 12.9 9.2 8.0 5.7 3.0 2.4

Source: Edelweiss research

8 Edelweiss Securities Limited Eicher Motors

Additional Data

Directors Data S Sandilya, Chairman Non -Executive Independent Directors Priya Brat Non -Executive Independent Directors M J Sibbaiah Non -Executive Independent Directors Prateek Jalan Non -Executive Independent Directors Siddhartha Lal, MD Executive Director R L Ravichandran, Whole Time Director Executive Director

Auditors - *as per last annual report

Holding – Top10 Perc. Holding Perc. Holding Reliance Capital Asset Management Ltd. 4.81 Bajaj Allianz Life Insurance Co. Ltd. 2.32 Amansa Capital Pte Ltd. (Investment Management) 2.01 Franklin Templeton Asset Management (India) Pvt Ltd. 1.65 DSP BlackRock Investment Managers Pvt Ltd. 1.58 SBI Funds Management Pvt Ltd. 1.17 UTI Asset Management Co. Ltd. 1.14 JF Asset Management Ltd. 0.69 Morgan Stanley Investment Management, Inc. 0.62 Dimensional Fund Advisors, Inc. 0.41

Bulk Deals Data Acquired / Seller B/S Qty Traded Price

No Data Available

*in last one year

Insider Trades Reporting Data Acquired / Seller B/S Qty Traded

No Data Available

*in last one year

9 Edelweiss Securities Limited RATING & INTERPRETATION

Company Absolute Relative Relative Company Absolute Relative Relative reco reco risk reco reco Risk Ashok Leyland BUY SO H Bajaj Auto HOLD SU L Eicher Motors HOLD SU M Exide Industries BUY SP L Hero MotoCorp HOLD SU H Mahindra & Mahindra Ltd BUY SO M Maruti Suzuki India Ltd BUY SO H Tata Motors Ltd BUY SP H

ABSOLUTE RATING

Ratings Expected absolute returns over 12 months

Buy More than 15%

Hold Between 15% and - 5%

Reduce Less than -5%

RELATIVE RETURNS RATING

Ratings Criteria Sector Outperformer (SO) Stock return > 1.25 x Sector return

Sector Performer (SP) Stock return > 0.75 x Sector return

Stock return < 1.25 x Sector return

Sector Underperformer (SU) Stock return < 0.75 x Sector return

Sector return is market cap weighted average return for the coverage universe within the sector

RELATIVE RISK RATING

Ratings Criteria

Low (L) Bottom 1/3rd percentile in the sector

Medium (M) Middle 1/3rd percentile in the sector

High (H) Top 1/3rd percentile in the sector

Risk ratings are based on Edelweiss risk model

SECTOR RATING

Ratings Criteria Overweight (OW) Sector return > 1.25 x Nifty return

Equalweight (EW) Sector return > 0.75 x Nifty return

Sector return < 1.25 x Nifty return

Underweight (UW) Sector return < 0.75 x Nifty return

10 Edelweiss Securities Limited Eicher Motors

Edelweiss Securities Limited, Edelweiss House, off C.S.T. Road, Kalina, Mumbai – 400 098. Board: (91-22) 4009 4400 , Email : [email protected] Vikas Khemani Head Institutional Equities vikas.khemani@edel weissfin .com +91 22 2286 4206

Nischal Maheshwari Co-Head Institutional Equities & Head Research [email protected] +91 22 4063 5476

Nirav Sheth Head Sales [email protected] +91 22 4040 7499

Coverage group(s) of stocks by primary analyst(s): Automobiles Ashok Leyland, Bajaj Auto, Eicher Motors, Exide Industries, Hero MotoCorp, Mahindra & Mahindra Ltd, Maruti Suzuki India Ltd, Tata Motors Ltd

Recent Research

Date Company Title Price (INR) Recos

07 -Aug -13 Tata Domestic operations drags, 279 Buy Motors JLR steady; Result Update 25 -Jul -13 Maruti Suzuki Powertain drives 1,414 Buy Suzuki margin surge; Result Update 24 -Jul -13 Hero Lower expenses, commodity 1,754 Hold Motocorp prices boost margin; Result Update

Distribution of Ratings / Market Cap

Edelweiss Research Coverage Universe Rating Interpretation

Buy Hold Reduce Total Rating Expected to

Rating Distribution* 127 44 8 180 Buy appreciate more than 15% over a 12-month period * 1 stocks under review Hold appreciate up to 15% over a 12-month period > 50bn Between 10bn and 50 bn < 10bn

Reduce depreciate more than 5% over a 12 -month period Market Cap (INR) 112 54 14

11 Edelweiss Securities Limited Automobiles

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12 Edelweiss Securities Limited Eicher Motors

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