Report Write 2

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Motilal Oswal Financial Services Limited

BSE:

BSE: 532892 532892 NSE: NSE: MOTILALOFS MOTILALOFS Bloomberg:MOFS:Bloomberg:MOFS:IN IN Reuters: Reuters: MOFS.BOMOFS.BO

www.motilaloswal.com

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Corporate Corporate Overview

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Corporate Corporate Overview

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●

● Group Profile & StructuGroup Profile & Structurere ●

● Evolution Evolution ●

● Our Businesses Our Businesses ●

● Our Strengths Our Strengths ●

● Corporate Governance Corporate Governance ●

● Management Team Management Team Corporate Corporate Overview

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Group Profile and Structure

● Well-diversified, financial services company offering a range of financial products and services

● Focused on wealth creation for all its customers, such as institutional clients, HNWIs and retail customers

● Network spread over 527 cities comprising 1,484 business locations operated by our business partners and us with 773,716 total registered customers

● Shares listed on the Bombay Stock Exchange and National Stock Exchange in Mumbai

99.95%

Motilal Oswal Securities Ltd. Institutional Equities Broking & Distribution

Motilal Oswal Investment Advisors Private Ltd.

Investment Banking

Motilal Oswal Private Equity Advisors Private Ltd.

Private Equity Real Estate

100% 85% 99.95%#

# through Motilal Oswal Securities Limited

Motilal Oswal Financial Services Ltd.

Motilal Oswal

Wealth Management Pvt. Ltd. Financial Strategy Wealth Management

99.95% #

Motilal Oswal Asset Management Co. Ltd. Portfolio Mgmt Services

Mutual Funds Offshore Funds

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Retail broking Institutional Equities PMS Distribution MF, IPO Insurance Investment Banking Retail broking Institutional Equities Distribution MF, IPO Retail broking Institutional Equities Private Equity Lending (LAS) PMS Wealth Management Retail broking Institutional Equities Investment Banking Private Equity Principal Strategies Lending (LAS) PMS Wealth Management Distribution MF, IPO Insurance

Broking Integrated Financial Services

1987- 95 1996- 2005 2006- 2007 2008 2010 Retail broking Institutional Equities Investment Banking Private Equity Principal Strategies Lending (LAS) PMS Wealth Management Distribution MF, IPO Insurance Mutual Fund

Evolution

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Well established

DISTRIBUTION NETWORK Independent and INSIGHTFUL RESEARCH

STRONG RELATIONSHIPS with institutional investors

and high net worth investors (HNIs)

HIGH CREDIBILITY resulting in higher cross-selling

opportunities

INTEGRATED FINANCIAL SERVICES PROVIDER Broking & Distribution Private Equity Asset Management Principal Strategies Investment Banking Wealth Management Institutional Equities

Our Businesses

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Experienced Top Management Strong Brand Name Leadership in Franchisee Business Large Pan-India Distribution Network Strong Investment Culture Independent and Insightful Research Financial Prudence Strong Risk Management Practices

Our Strengths

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Corporate Governance

● MOFSL is committed to ensuring compliance with the best practices in corporate governance

● Composition of MOFSL’s Board of Directors:

o The Board currently consists of 6 members with 50% composition of Independent Directors

● MOFSL has six major Board level Committees : o Audit Committee

o Shareholders / Investors Grievance Committee o Remuneration / Compensation Committee o Nomination Committee

o Risk Management Committee

o Asset Liability Management Committee

o ESOP Committee

o Debenture Committee

● External auditors play a role in providing an independent assessment of MOFSL’s financial position

Independent Directors

Mr Paranjpe is a consultant in HR & strategic management with companies like Reliance Industries, Blackstone etc. He was the Director, HR Operations at HP Singapore, and has worked with Hotel Corp, Johnson & Johnson, Hindustan Lever etc

Vivek Paranjpe Praveen Tripathi Balkumar Agarwal

Mr Tripathi is the CEO of Magic9 Media & Consumer Knowledge Pvt Ltd. He is the

Chairman of the National Consumer

Classification System Committee and has also worked with Pidilite, Hansa Consulting, Zenithmedia, Starcom/Leo Burnett etc

Mr Agarwal a retired IAS officer (1967 batch). He has served as Additional Chief Secretary, Secretary (Housing), Secretary (Transport), Secretary (Industries) to the Government of Maharashtra, and as the MD at Maharashtra State Warehousing Corp, Maharashtra State Financial Corp etc

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Management Team

Chairman & Managing Director Motilal Oswal

Joint Managing Director & Co-founder Raamdeo Agrawal

Director Navin Agarwal

Corporate Affairs Harsh Joshi

Chief Financial Officer Sameer Kamath

Business Process Excellence Praveen Arora

Information Technology Ashwini Yadav

Chief Operating Officer Ajay Menon

Research Rajat Rajgarhia

Marketing Ramnik Chhabra

Human Resources & OD Sudhir Dhar

Ashutosh Maheshvari Vishal Tulsyan Vijay Goel A.V. Srikanth Aashish Somaiyaa Srikanth Iyengar Navin Agarwal Investment Banking Private Equity Institutional Equities

Broking & Distribution

Wealth Management

Asset Management

Principal Strategies

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Building Infrastructure for the Future

–

Motilal Oswal Tower

● MOFSL has invested in a new Corporate Office building in Prabhadevi, Mumbai with the aim to consolidate all businesses within a single location and leverage on group synergies.

● Total built-up area is 260,000 sq feet across 12 floors at a cost of approximately `_{2.80Bn (funded through internal accruals and} capitalised in balance sheet).

● Approximately 33% of the area would be let out in the initial years of operations

● Thus, MOFSL will be able to utilise significantly larger floor space at an incremental cost.

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● Broking & Distribution ● Institutional Equities ● Wealth Management ● Investment Banking ● Asset Management ● Private Equity Corporate

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1,289 1,397

1,644 _1,579 _1,484

548 568 611 552 ₅₂₇

Business Location No of cities 541,372

621,215

709,041 746,932 773,716

FY09 FY10 FY11 FY12 FY13

Retail Broking and Distribution

Growing Customer Base

● Total registered client base of 773,716 including 679,848 retail broking and distribution clients ● The ‘Customer first’ philosophy is executed

through strategic focus on:

o Increasing distribution reach and customer segmentation on individualclient’s needs o Wide bouquet of offerings

o Customer connect through investor seminars for our clients and business partners

Pan-India Distribution Reach

● Developed a Pan-India network in 527 cities across 1,484 locations (branches + franchisees), while ensuring the quality of the locations at the same time

● Extensive distribution network provides opportunities to cross-sell products

‘Knowledge First’for Client Engagement ● Use of simplified research products which

have been customized for retail clients to help them understand the investment ideas and enable them to take informed decisions

● In line with the philosophy of Knowledge First, MOSL conducts education seminars for investors and business partners each year on a Pan India basis. Last year, it conducted a multi-city investor education series ‘Investor

Ki Kahani Usi Ki Zubaani’, which saw a healthy turnout of investors in all the cities Total Registered Clients

Retail Broking & Distribution Clients

Distribution (Locations & Cities)

MOFSL offers investment services to retail clients, including equity & commodity broking, currency trading and distribution of financial products

471,062 550,401

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Retail Broking and Distribution

‘PartneringForGrowth’Franchisee Model ● Apart from branches, MOFSL also operates a

franchisee-based business partner model ● Some of our Business Partners have grown

manifold in terms of scale of business

● Operates ‘Upper MOST’, an interactive online tool for business development, reward, recognition for business partners

Leveraging on Technology

● Delivery models: Our newly developed trading platform – LITE, is powerful, feature-rich, and available in multiple versions

● Advisory Platforms: Direct dissemination of MOSL research and recommendations, with interactive features and customized view

● Online Account Opening is MOSL’s

industry first feature

● Portfolio Tracking and Review: Review and restructuring of client portfolios, recommends model portfolios, etc

Strong Advisory Infrastructure

● Recent equity strategies like MOSt Velocity etc saw good response from investors

Lite-Web LITE-Desktop LITE-Mobile Idea Dashboard 3.0 Advisory Dashboard My Motilal Oswal Portfolio Restructuring

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Institutional Equities: Research is our Strength

● Provides equity cash and derivatives brokerage services for institutional clients

● Client base of 527 institutions, as of Mar 2013

● Strong research team comprising of 27 research analysts covering almost 200 companies across over 20 sectors and 27 commodities

● Research product portfolio encompasses economic, sector, company and thematic reports

● Research is supported by extremely strong Sales Trading and Corporate Access teams

● Its Annual Global Investor Conference is one of the largest event formats of its kind in this industry

● It conducted its 8th edition in Mumbai in August 2012, with over 100 leading companies & experts interacting with over 180 institutional funds from across the world

● Ranked No. 2 in Best Local Brokerage, Best Overall Sales Service, Best for Events and/or Conferences & No. 3 in Best for Most Independent Research Brokerage in the AsiaMoney Brokers Poll 2012

● Won awards at the Zee BusinessIndia’s Best Market Analyst Awards 2011 and 2012

● Won 4 awards at the ET-Now Starmine Analyst Awards 2010 placing it amongst the Top 3 award winning brokers

● Ranked 2 (Best Local Brokerage) by the AsiaMoney Brokers Poll 2010 and 2009

● Rated No.1 (Best Recommendations Mid & Small Caps) and won awards in 3 out of 4 categories at the Starmine India Broker Rankings 2009 from Thomson Reuters

● Ranked 2 (Best Indian Broker 2009) by Institutional Investor ● No.1 Broker in ET Now-Starmine Analyst Awards 2009

Our Research has won Awards consistently, recent

being:-ET Now Starmine Analyst Awards 2010-2011

Award Winning Categories:

Category Sector Rank

Top Earnings Estimator Across Sectors 1 Top Earnings Estimator Financials 1 Top Stock Picker Energy 1 Top Stock Picker Real Estate 2

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Sample Research and Corporate Access

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Annual Wealth Creation Study

● The study identified ITC, TTK Prestige and Kotak Mahindra Bank as the biggest, fastest, consistent wealth creators, respectively

● It showed the contribution of the top-10 wealth creators declined from 76% in 2003 to 41% in 2012, indicating a more widespread wealth creation

● Financials have emerged as the largest wealth creating sector, followed by the Consumer sector Theme of this study was on‘EconomicMoat –Fountainhead of Wealth Creation’

● Economic Moat refers to how companies are able to build a sustainable competitive advantage, to keep competitors at bay for an extended period

● Extended competitive advantage period of Economic Moat companies leads to sustained superior profitability, by protecting it from being attacked by multiple business forces. This may ensure stock returns and eventually, wealth creation

● Strength of a Economic Moat is determined by the industry structure and the corporate strategy ● Over 2002-2012, Economic Moat companies have meaningfully outperformed the benchmarks

MOFSL conducted its 17th_{Annual Wealth Creation Study in December, 2012. The presentation of the study was followed by a Panel Discussion o n} the‘Role of Competitive Strategy in Wealth Creation’. The discussion was covered live on CNBC TV18

The 17th Wealth Creation report can be downloaded by clicking on this link http://www.motilaloswal.com/Wealth_Cre

ation_Study/Studies/

Mr Motilal Oswal – CMD, MOFSL and Mr Raamdeo Agrawal – Jt MD, MOFSL with Panel Members: Mr Amit Chandra – MD, Bain Capital, Mr Anil Singhvi – Chairman, Ican Investors and Mr Sanjoy Bhattacharyya

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Private Wealth Management

• Mutual Funds

• PMS

• Alternative Invst. Funds Professional Money Managers

• Equity • Fixed Income

• Commodity & Currency Trading

• Private Equity • Real Estate

• Structured Products Alternative Assets

• IPO Financing, ESOP Funding • LAS/LAP

• Institutional Credit Solutions Credit Solutions • Estate Planning • Trust services • Wills Wealth Transmission • Investment Bnkg. Services •Offshore Advisory & Solutions • Hedging & Insurance Advisory

Specialized Services

• Tax Advisory • Legal Advisory

Ancillary Services Our Offerings: A comprehensive menu of Multi Asset Class Advisory Solutions

● During Q4FY13, our private wealth management business launched the new and improved advisory proposition with the motto ‘Responsible

Advisory’ under the brand‘Motilal Oswal Private Wealth Management(MOPWM)’

● The value proposition is based on what clients are really seeking – Comprehensive risk profiling leading to portfolio advice which can be objectively tracked for value addition basis which it can be rewarded

● MOPWM launchedIndia’s first Advisory Index which will help clients track the value addition by an advisor objectively - an Industry First ● These initiatives aim to set a precedent in the way this business is run today

● Private wealth management business had an AUM of `20.2 billion, as of Mar 2013

● The business has been strengthened with the joining of A.V. Srikanth as CEO. Prior to this, he was with an Indian wealth management firm, where he played a significant role in growing the vertical. He was an integral part of the team that won several accolades for its product and advisory delivery

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Investment Banking

Select Transactions ● Deal making remained subdued across the industry, delaying transaction

closures. In this environment, companies continue to be cautious and play the wait-and-watch game with respect to capital raising activities, impacting the flow of new projects

● Strong management team with substantial experience in investment banking, corporate banking and advisory

● Won the “Asia Pacific Cross-Border Deal” and the “India M&A Investment

Banker” awards in 2010 for the M&A transaction of India’s Shree Renuka Sugars andBrazil’s Equipav SA

● Given our strong expertise in cross border deals, Motilal Oswal Investment Banking was the Lead Sponsor for the Latin America India Investors Forum in Nov 2011. This Forum was designed to connect corporates with institutional investors for business relationships between India and Latin America.

● However, the business is well aligned to arising market opportunities and the execution pipeline remains strong

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Asset Management

Portfolio Management Services business (PMS)

● MOSL transferred the PMS business to Motilal Oswal AMC via slump sale with effect from Oct 2010

● As on Mar 2013, PMS AUM was`12.6 billion

● As per SEBI data, our PMS had a market share of 8% in terms of discretionary-listed equity PMS assets, as of Aug 2011

● The AMC business has been strengthened with the appointment of Aashish Somaiyaa as CEO. He was earlier with a leading AMC as Head of Retail Business, where he played a significant role in growing the sales & distribution of its offerings through retail, banking and wealth channels across India & UAE

Mutual Funds business (MF)

● Mutual funds AUM across the 5 funds was `4.6 billion, as of Mar 2013 o MOSt Shares M50 ETF (M50) is India’s 1st Fundamentally Weighted

ETF based on the S&P CNX Nifty Index

o MOSt Shares Midcap 100 ETF (M100) is India’s 1st Midcap ETF based on the CNX Midcap Index

o MOSt Shares Nasdaq100 ETF (N100) is India’s 1st US equities based ETF, denominated in Indian Rupees

o MOSt 10 Year Gilt Fund (10 Yr Gilt) is India’s 1st fund providing access to 10 Year benchmark Government Bond

o MOStShares Gold ETF is India’s 1st Gold ETF which enables investment as well as consumption of pure gold for retail investors o MOSt Focused 25 Fund is investing in cos. with sustainable

competitive advantages, quality, longevity & high growth potential PMS AUM (

Mutual Funds AUM ( Mn)

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Motilal Oswal MOSt Shares

● Conducted the 2nd MOSt Shares ETF Conclave in June 2012. The objective was to demystify ETFs for Indian investors by discussing their advantages, building portfolios with ETFs andVanguard’s success

● James Norris, MD, Vanguard International gave the keynote speech Motilal Oswal MOSt Shares ETF Conclave

● MOAMC became the first Indian AMC to ring the opening bell at NASDAQ in USA during the launch of the Nasdaq 100 ETF

Launch of MOSt Shares Nasdaq 100 ETF

● Nasdaq 100 ETF won the‘Most Innovative ETF Asia Pacific 2011’ award at the 8th Annual Global ETF Awards 2012 in USA

● The M50 ETF bagged the ‘Most Innovative Fund of the Year’ award at the CNBC TV18-CRISIL Mutual Fund Awards 2011

Most Innovative Fund Awards

● MOAMC hosted the 2nd edition of Value Investing Forum in Oct 2012. The topic was‘Sources of Margin of Safety & its Importance in ValueInvesting’

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Private Equity

● MOPE is an investment manager and advisor to private equity funds, acts as an advisor and mentor to the investee companies and leverages the relationships of the Motilal Oswal group for the benefit of these companies

Investment Process _{Nurturing Process}

● India Business Excellence Fund (IBEF) is a growth capital fund with AUM of US$ 125 million fully committed in 13 companies. During a challenging year, it partially exited two companies via secondary sales at healthy multiples. It has returned approx 38% of capital to its investors so far ● India Realty Excellence Fund (IREF) is a domestic real estate fund with AuA of`2 billion. IREF has

made investments in 7 deals, committing about 92% of funds under management as of Mar 2013. Following partial exits from three projects, it has returned approx 19% of capital to investors so far ● The 2nd growth capital PE fund, India Business Excellence Fund-II achieved its third closing this

quarter, with commitments of`_{5.6 billion from both domestic and foreign investors. It is currently} evaluating several investment opportunities and has made two investments so far

Motilal Oswal Private Equity won ‘Best Growth Capital Investor-2012’ award at the

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● Size of opportunity ● Our Strategic Focus ● Progress Against Strategy Corporate

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32 243 80 454 FY 2010 FY 2020E Institutional (Rs Bn) Retail (Rs Bn) 697 112 6.2xGrowth

Size of Opportunity

Methodology:

● Current size of broking revenue pool estimated at `112Bn

● Market Cap to touch US$5Tn by 2020 based on GDP:Market Cap ratio of 1:1 ● Assume trading velocity to double from current 37% to ~80% by 2020

● This gives a expected market size of ~`697Bn by 2020, comprising `243Bn in institutional and `_{454Bn in retail segment}

Source: MOSL estimates

Factors that will help achieve this growth What Motilal Oswal is doing to create scale

India’s equity broking opportunity: Market size in terms of revenue pool expected to grow 6 times o ver the next 10 years

Although certain external risks remain ● Sustained economic, savings and

discretionary income growth ● Increase in retail participation

● Increased ability of DIIs to mobilize savings

● Higher India allocation by global funds ● Increase in fund raising by corporates ● Higher issues of fairly priced IPO/FPOs ● Tech-based tools forclient’s convenience

● Increasing distribution reach across India ● Using simplified research products ● Client focused advisory services

● Investor education for client engagement ● Tap the allocation of India focused funds ● Launched AMC to mobilize investments ● Develop relationships with corporates

embarking on the next phase of growth ● Technology for better client experience

● High inflation and interest rates ● Regulatory changes required DIIs to

realign their marketing strategy to be able to channelize higher savings ● Global recovery reducing India’s

relative attractiveness among global funds

● Poor performance of IPOs post listing

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Risk-Free Balance Sheet and Flexible Cost Structure Increase

Institutional market share

Increase Retail / Wealth Mgmt share

Our Strategic Focus

● Leverage research and advisory capabilities ● Investor education and knowledge dissemination ● Good quality Pan-India distribution network ● Strengthening Wealth Mgt’s product

bouquet and customized advisory ● Leveraging on technology

● Distribution of 3rdparty products

● Develop innovative, market-access products for the AMC platform

● Grow the Investment Banking business ● Ensure quality deal flow for Private Equity

● Increase Research support

● Build strong institutional relationships through wider and quality research ● Grow institutional derivatives business

● Use Principal Strategies Group to maximise returns using risk free arbitrage strategies ● Grow the Capital Markets Lending book

across client segments to complement our strong cash equities business

● Judicious use of Capital to ensure high Return on Equity and low Leverage ● Flexible Cost structure to maintain Profitability across market cycles

KNOWLEDGE FIRST

Solid Research

Solid Advice Grow

Fund based revenues Grow

Fee based revenues

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Progress Against Strategy

Research

Consistently won awards for earnings estimation and best recommendations, thus showcasing our strong research capabilities

Investor Awareness on Equity Investing

Continued its investor education initiatives and use of simplified versions of institutional research for the retail investors, in line with the Knowledge First philosophy

Retail Distribution Reach

Grew the Pan-India distribution presence further, currently stands at 1,484 locations across 527 cities

Empanelment of Institutions

Added to the number of domestic and foreign institutions empanelled

Corporate Access

The Annual Motilal Oswal Investor Conference is reckoned as one of the best-in-class conferences in India for institutional investors

Technology Tools and Platforms

Successfully developed and implemented a number of tech-based initiatives, including in-house developments

Private Equity businesses

Strong on-ground relationships helped achieve a healthy portfolio for existing funds and ensure good mobilization for the new fund

Consistent Margins and Low-Risk Balance Sheet

Flexible cost structure and negligible debt levels helped deliver consistent profit margins and strong RoE, despite market cycles

Wealth Management Product Bouquet

Strengthened Wealth Management’s product portfolio to offer multiple investment options and a holistic asset allocation for clients

Asset Management business

Launched innovative mutual funds, most of which were

India’s Firsts in terms of the market access provided by the investment products strategies

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● Financial Performance ● Recent Awards

Corporate

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Annual Financial Performance at a Glance

Consolidated revenues ( million) EBIDTA ( million, margin %) Reported PAT ( million, margin %)

Net worth ( million); ROE % (based on Avg NW and Reported PAT)

Net Cash ( million) Revenue Composition (%)

4,661

6,453

6,008

4,711 4,729

1,807 2,770 2,295 1,585 1,744 39% 43% 38% 34% 37%

926 1,704 1,371 1,039 1,091 20% 26% 23% 22% 23%

70% 71% 72% _69% 63% 10% 10% _7% 2% 2% 14% 10% 13% 17% 21% 5% 6% 7% 11% _13% 2% _3% 2% 1% _2%

Others Asset management fees Funds base d busine ss I nve stme nt bank ing fe es Broking & operating income

7,939 9,460 10,595 11,409 12,179 12% 20% 14% _9% 9%

5,428

3,250

2,772 2,710

2,144

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Consistently increasing dividends

# For FY13;`_{1 is paid as interim dividend +}`_{1 is proposed dividend; Buyback has been proposed} * Payout is calculated on Adjusted PAT for the respective years

0.80

1.20

1.40

1.50

2.00 7%

13%

10%

17%

26%

35%

FY08

FY09

FY10

FY11

FY12

FY13

#

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Latest Quarter Performance

E & EOI = Exceptional items & Extraordinary items, EOI = Extraordinary items

Particulars Q4 FY13 Q3 FY13 Q4 FY13 Q4 FY12 FY13 FY12

million Mar 31, 2013 Dec 31, 2012 Mar 31, 2013 Mar 31, 2012 Mar 31, 2013 Mar 31, 2012

Brokerage & operating income 763 772 -1% 763 904 -16% 2980 3240 -8% Investment banking fees 8 20 -59% 8 39 -79% 78 88 -11% Fund based income 377 200 89% 377 225 67% 997 822 21% Asset Management Fees 170 139 22% 170 130 31% 591 504 17% Other income 23 19 19% 23 (1) nm 83 59 41% Total Revenues 1341 1150 17% ₁₃₄₁ ₁₂₉₇ 3% ₄₇₂₉ ₄₇₁₁ 0%

EBIDTA 570 388 47% ₅₇₀ ₄₀₉ 39% ₁₇₄₄ ₁₅₈₅ 10%

PBT (before E & EOI) 477 310 54% 477 345 38% 1437 1419 1%

Reported PAT 367 292 26% ₃₆₇ ₂₁₇ 69% ₁₀₉₁ ₁₀₃₉ 5%

Adjusted PAT (before E & EOI) 328 196 67% ₃₂₈ ₂₁₈ 50% ₉₆₉ ₉₆₇ 0%

EPS - Basic (before EOI) 2.6 2.0 2.6 1.5 7.6 7.2 EPS - Diluted (before EOI) 2.6 2.0 2.6 1.5 7.6 7.2 No.of shares outstanding

(million) - FV Rs 1/share 145 145 145 145 145 145 Operatingcosts% 21% 25% 21% 27% 23% 25% Personnelcosts% 22% 23% 22% 25% 23% 24% Others% 14% 18% 14% 17% 17% 16% EBIDTA% 42% 34% 42% 32% 37% 34% PAT% 27% 25% 27% 17% 23% 22% AdjustedPAT% 24% 17% 24% 17% 20% 21% Change (%) Q-o-Q Change (%) Y-o-Y Change (%) Y-o-Y

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Recent Awards

‘Best Equity Broking House’ award for

FY11 at the Dun & Bradstreet Equity Broking Awards 2011

‘Best Capital Markets and Related NBFC’ award at

the CNBC TV18 India Best Banks and Financial

‘Excellence in HR through Tech’ and ‘Excellence in

Healthcare’ awards at Asia’s Best Employer

Brand Awards 2011 in

‘Most Innovative Fund of the Year’ award at the

CNBC TV18-CRISIL Mutual Fund Awards 2011 for the 'Best Performing National

Financial Advisor Equity Broker' award at CNBC TV18

Financial Advisor Awards 2012, for the 2nd year

Investment Banking bagged

‘Asia Pacific Cross-Border

Deal of the Year’ and ‘India M&A Investment Banker’

Ranked as No. 1 Broker in India at the

ET-Starmine Analyst Awards, 2009 Felicitated by BSE for

being Amongst the Top Five Performers in BSE Star – Mutual Fund and

Amongst the Top Ten Performers in Equity Segment for the period

Nov 2010 – Sept 2011

‘Best Equity Broker’

award at Bloomberg UTV Financial Leadership Awards

2012

Private Equity won

‘Best Growth Capital

Investor-2012’ award

at the Awards for PE

‘Retailer of the Year

(Banking & Financial

Services)’ award at the

Retail Excellence Awards 2012

Existing Businesses: Retail Broking and Distribution, Institutional Equities

New Businesses: NBFC, Asset Management, Private Equity and Investment Banking Others

Nasdaq 100 ETF won the

‘Most Innovative ETF Asia Pacific 2011’ award at the

8th Annual Global ETF

‘Quality Excellence

for Best Customer

Service Result’

award at National Quality Excellence Adjudged amongst Top

20 innovators in BFSI space at the Banking Frontiers Finnovity

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● Equity Participation ● Investment Banking &

Private Equity ● Mutual Funds

● Wealth Management Corporate

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Options boost market ADTO yet again, Delivery up within cash

Source: NSE, BSE Source:

NSE, BSE

Options continued their dominance and comprised 76% of market ADTO; Proportion of cash to overall volumes dips

further, reaches 8% of total volumes in the year Market ADTO hit a high this year, led by the continued

growth in options, Absolute volumes of cash dipped, largely due to the decline in intraday segment (

On a YoY basis, proportion of options within F&O volumes continued to grow On a YoY basis, the proportion of delivery within market

cash volumes picked up this year

28%

72% FY12

30%

70% FY13

Delivery to Cash Volume s Intraday to Cash Volume s

24% 76% FY12 18% 82% FY13

Futures to F&O Volumes Options to F&O Volumes

35 50 50 39 39 124 176 133 101 92 291 374 ₃₈₈ 315 ₂₇₅ 163 350 764 977 1,274

FY9 FY10 FY11 FY12 FY13 Options Futures Intraday Delivery

1,335 1,431 1,679 950 612 27% 37% 57% 68% 76% 47% 39% 29% 22% 16% 20% 19% 10% 7% 5% 6% 5% 4% 3% 2%

FY9 FY10 FY11 FY12 FY13 Delivery Intraday Futures Options

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600

242

-187 -53 -691 FY09 FY10 FY11 FY12 FY13

-479

1,102 1,101

437

1,400

14.2 15.2 17.2 19.0

20.0

1.0 2.0

1.8 0.9

1.0

Ex ist in g Ac co un ts (Mn ) Ne w Ac co unt s (Mn)

8% CAGR

Retails’ proportion dips; FII inflows and DII outflows continue

Strong inflows from FIIs this year was a major catalyst to participation, Net inflows were highest in the months of

Sep, Oct, Dec, Jan and Feb (

Source: NSE

DIIs saw net outflows in each of the three quarters since Q2 FY13 in this year, Mutual funds saw redemptions as

equity investors pulled out (

Source: SEBI

Proportion of retail to cash volumes dipped as retail cash ADTO declined; Proportion of FII to cash volume picked up

Growth in new demat accounts (Mn) at its slowest since the last five years, as primary market activities

largely dried up

Source: NSE, BSE

53% 57% 56% _51% _49% 26% 25% 22% 23% _23% 15% 12% _15% _18% 19% 6% 6% 7% 8% 9%

FY09 FY10 FY11 FY12 FY13 DII FII Prop Retail

Bn)

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56% 37% 19% 28% 12% _45% 27% 27% 32% 18% 52% 35%

CY09 CY10 CY11 CY12 Domestic Outbound Inbound

43.4 38.8 49.8 12.0 14% 21% 41% 13% _9% 78% 7% 7% 14% 10% 8% 72% 52% 73% 82%

Additional (FPO) Rights IPO

740 156 1,156 809 468 314 258 456 421 428 0.81 0.84 1.10 0.85 1.09

FY09 FY10 FY11 FY12 FY13 Deal Va lue (Rs Bn) Aver ag e Dea l Si ze (Rs Bn)

ECM sluggish, DCM flat, PE and M&A faced challenges

Source: Bloomberg League Tables Source: Bloomberg League Tables

DCM volumes still saw some activity as compared to earlier years, But the last couple of quarters saw a number of

companies deferring debt raising plans ( ECM remained sluggish, IPOs and Rights largely dried up,

Additional saw an increase due to higher activity levels in Offer for Sale issues (

PE investments were impacted this year by limited quality deployment opportunities, uncertain economic outlook

and slower exits of existing holdings

Source: News article on Thomson Reuters report

M&As faced challenges due to high interest rates and uncertain economic outlook; Inbound deals saw major growth (US$ Bn)

40% _34% _31% 38% 44%

34% 51% 55% 39% 39%

26% 15% 14% 22% 16%

FY09 FY10 FY11 FY12 FY13 Loans Mandated (For) Loans Mandated Dom Bonds

5,967 2,883 4,829 5,568 5,278

Bn) Bn)

(36)

28% 35% 36% 34% 27% 47% 51% 49% _50% 56% 22% 13% 12% 14% 13% 3% 1% 2% _3% 3%

FY09 FY10 FY11 FY12 FY13 Gi lt, Gol d & Other s Li qui d / Money Ma rket I ncom e E qui ty

4,173 6,140 5,923 5,872 7,014 0.5 1.2 1.7 2.5 2.4 0.05% 0.08% 0.11% 0.13% 0.12% 2009 2010 2011 2012 Mar-13

India ETF AUM ($Bn) India ETF % to Global ETF AUM

31% 25% 3% 3% 30% 25% 5% 6% 0.3% 0.3% 6% 6% 18% 20% 7% 14% FY 11 FY 12 FDs/Bonds MF Equity PF

Alternate Assets Small Savings Insurance Savings Dep

86 92

Equity funds AUM down, while Income/Gilt/Gold AUM rise

Source: AMFI

MF AUM saw a dip in equity assets as equity funds saw redemptions, Gilt, gold and income fund assets saw an uptick (

ETFs continued to grow in CY2012, led by Gold ETFs, while equity ETFs declined in line with market movements

Source: Karvy Wealth

report Source: Karvy Wealth

report

Asset-wise wealth classification (as of 2011) shows Equity currently comprises a much lesser proportion in India than the Global average Individual wealth in India is estimated at 92.3Tn in FY12, led by

the fixed deposit/bonds, equity and insurance sectors

Source: AMFI/Blackrock report

36% 62% 2.8% Global 32% 68% 0.3% India Bn)