October 30, 2015
Result Update
Solid quarter…
•
Firstsource Solutions (FSL) reported strong Q2FY16 earnings, which
were in line with our raised estimates
•
Revenues from operations grew 6.1% QoQ to | 792.5 crore in line
with our | 797 crore and 6.7% QoQ growth estimate. Constant
currency revenues grew 3.2% QoQ
•
At 12.4%, EBITDA margins improved 41 bps QoQ and were above
our 20 bps improvement and 12.2% estimate. Reported PAT of
| 61.9 crore was also above our | 61 crore estimate, led by margin
improvement
Solid quarter; guidance intact…
FSL’s revenues during the quarter grew 6.1% QoQ (3.2% QoQ in constant
currency) led by a recovery in top client (up 16.8% QoQ), absence of
revenue leakages led by the US telecom client and domestic business,
and growth in telecom & media and healthcare verticals. FSL’s
management highlighted that a majority of growth concerns are behind
them and recent deal wins [closed large transformational deal with UK
BFSI client with total contract value (TCV) of ~$170 million over 10 years
period, which would contribute $7-8 million in H2FY16) and bookings –
won deals worth $37 million in annual contract value (ACV) in Q2FY16
taking the total H1FY16 ACV to $61 million ($81 million in H1FY15] – could
help sustain growth momentum in H2FY16.
Margin improvement trajectory may continue in H2FY16E…
Q2FY16 margins improved 41 bps QoQ and 16 bps YoY to 12.4%, with
minimal revenue leakages, operational efficiency and rationalisation of
domestic accounts. The management narrowed its EBITDA margin
guidance and now expects margin to expand 70-80 bps (70-90 bps
earlier) YoY in FY16E led by better margins in new deals, tailwinds from
termination of loss-making accounts, acceleration in 1) collections
business in Q4 led by seasonality and 2) healthcare and analytics
business, partially offset by SG&A investments. Overall, FY15 margins
improved 89 bps YoY to 12.5% led by rationalisation of loss making
accounts.
Top customer recovers sharply…
Top customer growth rebounded sharply – grew 16.8% QoQ vs. 7.2%
7.1% and 6.8% QoQ decline in Q1FY16 and Q4, Q3FY15, respectively.
However, revenues are still down 6.2% on YoY basis and contrasts with
25% CAGR reported during FY10-15 and continues to drag company
average. Top 25 customer revenues grew 3.9% YoY and 7.1% QoQ (vs.
-5.2%, 2.5% respectively in Q1FY16) but is modest compared to 9.4% YoY
CAGR achieved during FY10-15. Recovery in top and top 2-5 clients vs.
uneven earlier (led by client specific ramp-downs and decision making
delays) bodes well for company average growth.
Maintaining estimates; target price…
We estimate FSL will report revenue, earnings CAGR of 4%, 22% over
FY15-17E (average 13.7% EBITDA margins in FY16-17E), vs. 9%, 12%
reported in FY10-15 (average 11.8%) as recovery in top customer, new
deal wins could help growth while focus on margins could yield
profitability. We continue to value the stock at | 45, i.e. at 6x FY17E
EV/EBITDA, modestly below its FY10-15 average of 6.7x, to account for
moderating growth and maintain our BUY rating on reasonable
Firstsource Solutions (FIRSOU)
| 31
Rating matrix
Rating : Buy
Target : | 45
Target Period : 12 months Potential Upside : 45%
What’s changed?
Target Unchanged
EPS FY16E Unchanged
EPS FY17E Unchanged
Rating Unchanged
Quarterly performance
Q2FY16 Q2FY15 YoY (%) Q1FY16 QoQ (%)
Revenue 792 774 2.4 747 6.1 EBITDA 98 95 3.7 90 9.7 EBITDA (%) 12.4 12.3 16 bps 12.0 41 bps PAT 62 61 1.0 56 9.6
Key financials
| Crore FY14 FY15E FY16E FY17E
Net Sales 3,106 3,035 3,237 3,501 EBITDA 362 381 431 490 Net Profit 193 234 290 352 EPS (|) 2.8 3.3 4.2 5.1
Valuation summary
FY14 FY15E FY16E FY17E
P/E 11.0 9.3 7.4 6.1 Target P/E 16.0 13.5 10.8 8.9 EV / EBITDA 8.0 7.2 5.8 4.4 P/BV 1.0 1.0 0.9 0.8 RoNW (%) 9.2 11.2 12.2 12.9 RoCE (%) 7.7 9.5 11.6 14.1
Stock data
Particular Amount
Market Capitalization (| Crore) 2,084.1 Total Debt (Sept-15) (| Crore) 719.8 Cash and Investments (Sept-15) (| Crore) 172.3 EV (| Crore) 2,631.6 52 week H/L 42.8 / 24.2 Equity capital 672.3 Face value 10.0
Price performance
1M 3M 6M 12M
FSOL 12.2 11.9 17.8 (10.2) HGS 0.6 (8.7) (20.4) (22.1) EXL 9.6 12.8 32.0 30.0 Genpact 2.7 1.2 10.7 23.5
Research Analyst Abhishek Shindadkar
Variance analysis
Q2FY16 Q2FY16E Q2FY15 YoY (%) Q1FY16 QoQ (%) Comments
Revenue 792.5 797.0 774.0 2.4 746.9 6.1
Revenues grew 6.1% QoQ in line with our raised estimates. Constant currency revenues grew 3.2% QoQ
Employee expenses 534.2 534.8 520.0 2.7 499.7 6.9
Gross Margin 258.3 262.2 254.0 1.7 247.3 4.5 Gross margin (%) 32.6 32.9 32.8 -22 bps 33.1 -51 bps SG&A expenses 159.9 164.9 159.1 0.5 157.6 1.4
EBITDA 98.4 97.3 94.9 3.7 89.7 9.7
EBITDA Margin (%) 12.4 12.2 12.3 16 bps 12.0 41 bps
EBITDA margins improved 41 bps QoQ above our 20 bps improvement estimate
Depreciation & amortisation 18.3 18.3 17.7 3.2 17.2 6.4 EBIT 80.1 79.0 77.1 3.8 72.5 10.5 EBIT Margin (%) 10.1 9.9 10.0 14 bps 9.7 41 bps Other income (less interest) -12.1 -10.3 -13.4 -9.8 -9.7 25.0
PBT 68.0 68.7 63.8 6.7 62.8 8.3
Tax paid 6.1 7.6 2.5 145.3 6.3 -3.1
PAT 61.9 61.0 61.2 1.0 56.4 9.6
Source: Company, ICICIdirect.com Research
Change in estimates
FY16E FY17E
(| Crore) Old New % Change Old New % Change Comments
Revenue 3,237 3,237 0.0 3,501 3,501 0.0
Management commentary indicates FY16E constant currency revenues could grow 7%
EBITDA 431 431 0.0 490 490 0.0
EBITDA Margin (%) 13.3 13.3 0 bps 14.0 14.0 0 bps
FY16 EBITDA margin improvement guidance narrowed to 70-80 bps vs. ~70-90 bps earlier
PAT 290 290 0.0 352 352 0.0
EPS (|) 4.2 4.2 0.0 5.1 5.1 0.0 Source: Company, ICICIdirect.com Research
Company Analysis
Solid quarter; guidance intact…
FSL’s revenues during the quarter grew 6.1% QoQ (3.2% QoQ in constant
currency) led by a recovery in top client (up 16.8% QoQ), absence of
revenue leakages led by the US telecom client and domestic business,
and growth in telecom & media and healthcare verticals. The FSL
management highlighted that a majority of growth concerns are behind
them and that recent deals wins (closed large transformational deal with
UK BFSI client with total contract value (TCV) of ~$170 million over 10
years period, which would contribute $7-8 million in H2FY16) and
bookings – won deals worth $ 37 million in annual contract value (ACV) in
Q2FY16 taking the total H1FY16 ACV to $61mn ($81 million in H1FY15) –
could help sustain growth momentum in H2FY16.
Finally, the commentary suggests that deals already won provide 4-4.5%
YoY growth visibility while the balance (7% YoY FY16E guidance) could
be made from another “lift-off deal” which the company expects to close
by December 2015/January 2016. Consequently, we maintain our revenue
growth assumption.
Recall, FY15 revenues had declined 2.3% YoY led by rationalisation of
loss making accounts (including large Irish telecom client) and new deal
ramp-ups delays. The management expects $12-15 million revenue
headwind from this telco client in FY16E with additional ~$8 million
impact from the domestic telco business.
Exhibit 1:Rupee revenue may grow at 5% CAGR during FY15-17E
1971 20552255
28193106
756 774 751 754
3035 3237 3501
747 792 12.7
-2.1
-5.3
8.1
4.3 9.7
25.0
10.2 5.1 -6.1
-2.3 -1.1 2.4
6.7
500 1300 2100 2900 3700 4500
FY
10
FY
11
FY
12
FY
13
FY
14 Q1 Q2 Q3 Q4
FY
15 Q1 Q2
FY
16E
FY
17E
| crore
-10 0 10 20 30 40
%
Rupee revenue Growth, YoY
Source: Company, ICICIdirect.com Research
Margin improvement trajectory could continue in H2FY16E…
Q2FY16 margins improved 41 bps QoQ and 16 bps YoY to 12.4%, with
minimal revenue leakages, operational efficiency and rationalisation of
domestic accounts. The management narrowed its EBITDA margin
guidance and now expect margin to expand 70-80 bps (70-90 bps earlier)
YoY in FY16E led by better margins in new deals, tailwinds from
termination of loss-making accounts, acceleration in 1) collections
business in Q4 led by seasonality, and 2) healthcare and analytics
business, partially offset by SG&A investments. Overall, FY15 margins
improved 89 bps YoY to 12.5% led by rationalisation of loss making
accounts. Recall, FSL’s operating margins declined to 8.2% in FY12 vs.
14.2% in FY10 and were impacted by a variety of reasons including rise in
delinquencies, investments in India operations, decentralising corporate
functions and timing of big acquisitions.
Exhibit 2:Modelling margin improvement of ~80 bps YoY in FY16E
14.2 14.1
8.2 9.9
11.7 12.3 12.3 12.5 13.2 12.5 12.0 12.4
13.3 14.0
5 8 11 14 17 20
FY
10
FY
11
FY
12
FY
13
FY
14 Q1 Q2 Q3 Q4
FY
15 Q1 Q2
FY
16E
FY
17E
%
EBITDA margin
Source: Company, ICICIdirect.com Research
Exhibit 3:Growth, headcount rationalisation could drive seat fill factor higher
80.0
71.0 74.1
81.8
77.0
73.4 73.1 72.0
69.0 69.0 68.0
66.6 65
69 73 77 81 85
FY
10
FY
11
FY
12
FY
13
FY
14 Q1 Q2 Q3 Q4
FY
15 Q1 Q2
%
Seat fill factor
Source: Company, ICICIdirect.com Research
Top customer recovers sharply…
Top customer growth rebounded sharply – grew 16.8% QoQ vs. 7.2%
7.1% and 6.8% QoQ decline in Q1FY16 and Q4, Q3FY15, respectively.
However, revenues are still down 6.2% on YoY basis and contrasts with
25% CAGR reported during FY10-15 and continues to drag company
average. Top 25 customer revenues grew 3.9% YoY and 7.1% QoQ (vs.
-5.2%, 2.5% respectively in Q1FY16) but is modest compared to 9.4% YoY
CAGR achieved during FY10-15. Recovery in top and top 2-5 clients vs.
uneven earlier (led by client specific ramp-downs and decision making
delays) bodes well for company average growth.
Debt repayment on track…
As on Q2 end, FSL had net long term debt of ~$105 million and cash of
~$26.3 million assuming period ending rates. At the current repayment
rate, FSL would repay ~$22.5 million of its debt in the remainder of
FY16E and could result in a net debt of ~$82 million assuming current
cash levels and no accelerated payments. We estimate the net debt
neutral status achievement could likely be achieved in FY17E.
Outlook and valuation
Firstsource reported strong Q2FY16 earnings, which were in line with our
raised estimates. Revenues from operations grew 6.1% QoQ in line with
our raised 6.7% QoQ growth estimate. Constant currency revenues grew
3.2% QoQ. Recovery in top, top 2-5 customers and deal momentum
bodes well and could help FSL in achieving its 7% constant currency
revenue growth and 70-80 bps operating margin improvement guidance
in FY16E.
We estimate FSL will report revenue, earnings CAGR of 4%, 22% over
FY15-17E (average 13.7% EBITDA margins in FY16-17E) vs. 9%, 12%
reported during FY10-15 (average 11.8%) as recovery in top customer,
new deal wins could help growth while focus on margins could yield
profitability. We continue to value the stock at | 45, i.e. at 6x FY17E
EV/EBITDA, modestly below its FY10-15 average of 6.7x, to account for
moderating growth and maintain our BUY rating on reasonable
valuations.
Exhibit 4:One year forward rolling EV/EBITDA
0 1000 2000 3000 4000 5000
Se
p-08
Fe
b-09
Ju
l-09
Dec
-09
May
-10
Oc
t-10
Ma
r-11
Aug-1
1
Jan
-12
Jun
-12
No
v-12
Ap
r-1
3
Se
p-13
Fe
b-14
Ju
l-14
Dec
-14
May
-15
Oc
t-15
|
EV 10 8 6 4 2
Source: Company, ICICIdirect.com Research
Exhibit 5:Valuations
Sales Growth EPS Growth PE EV/EBITDA RoNW RoCE (| cr) (%) (|) (%) (x) (x) (%) (%)
FY14 3,106 10.2 2.8 (0.4) 11.0 8.0 9.2 7.7 FY15 3,035 (2.3) 3.3 18.4 9.3 7.2 11.2 9.5 FY16E 3,237 6.7 4.2 24.8 7.4 5.8 12.2 11.6 FY17E 3,501 8.1 5.1 21.4 6.1 4.4 12.9 14.1
Company snapshot 0 10 20 30 40 50 60 Ja n-10 Ap r-1 0 Ju l-10 Oc t-10 Ja n-11 Ap r-1 1 Ju l-11 Oc t-11 Ja n-12 Ap r-1 2 Ju l-12 Oc t-12 Ja n-13 Ap r-1 3 Ju l-13 Oc t-13 Ja n-14 Ap r-1 4 Ju l-14 Oc t-14 Ja n-15 Ap r-1 5 Ju l-15 Oc t-15 Ja n-16 Ap r-1 6 Ju l-16 Oc t-16
Target price : | 45
Source: Bloomberg, Company, ICICIdirect.com Research
Key events
Date Event
Feb-11 FSOL approves merger of unit Revit Systems with itself
Dec-11 The stock hits all-time low as it reports lowest net profit since Q1FY09 and lowest ever net profit on annualised basis since FY08 Dec-12 RPG led CESC acquires 56% stake in the company. Repays FCCB obligation worth $ 237 million in December 2012.
Jan-13 CESC-controlled Spen Liq Ltd tenders an open offer to acquire additional stake in the company at | 12.2 per share Jul-13 Rakesh Jhunjhunwala buys 5.14% stake in the company at an average | 10 per share
Dec-13 The company successfully makes its third quarterly principal repayment of $11.25 million on its outstanding debt on December 31, 2013 Mar-14 The company successfully makes its fourth quarterly principal repayment of $11.25 million on its outstanding debt on March 31, 2014
Apr-14
The company reports in line quarter with 174 bps margin expansion for FY14 led by exiting lower margin domestic business. It reduces FY15E growth outlook to 6% from 8% earlier.
Nov-14 FSL reports moderate growth during Q2FY15 with 94 bps YoY margin expansion. However, it lowers its FY15E guidance to 2-2.5% vs. 6% earlier May-15 Reports weak Q4FY15 earnings as revenues, absolute EBITDA and PAT were below our estimates
Jun-15 Firstsource reports soft Q1FY16 earnings. Though revenues were above our estimates, absolute EBITDA and PAT were below
Oct-15
Reports strong Q2FY16 earnings, which were in line with our raised estimates.Revenues from operations grew 6.1% QoQ while constant currency revenues grew 3.2% QoQ
Source: Company, ICICIdirect.com Research
Top 10 Shareholders Shareholding Pattern
Rank Name Latest Filing Date % O/S Position (m) Change (m)
1 RPG Enterprises 30-Sep-15 55.79 374.0 0.0
2 ICICI Group 30-Sep-15 4.80 32.2 0.0
3 Jhunjhunwala (Rakesh) 30-Sep-15 3.73 25.0 0.0 4 Goldman Sachs Asset Management International 30-Sep-15 2.76 18.5 0.3 5 Deutsche Asset Management (India) P rivate Ltd. 30-Jun-15 2.50 16.7 0.1 6 Birla Sun Life Asset Management Company Ltd. 30-Sep-15 1.81 12.2 3.2 7 Steinberg Asset Management, LLC 30-Sep-15 1.46 9.8 9.8 8 Dimensional Fund Advisors, L.P. 31-Aug-15 1.41 9.4 0.0 9 Principal PNB Asset Management Company Ltd. 30-Sep-15 0.46 3.1 0.3 10 Subramaniam (Rajesh) 2-Sep-15 0.26 1.8 1.3
(in %) Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
Promoter 56.41 56.23 56.13 56.08 55.79 FII 7.88 8.25 9.13 9.84 9.10 DII 7.19 7.28 6.72 6.80 7.34 Others 28.52 28.24 28.02 27.28 27.77
Source: Reuters, ICICIdirect.com Research
Recent Activity
Investor name Value Shares Investor name Value Shares
Steinberg Asset Management, LLC 3.94m 9.78m DSP BlackRock Investment Managers Pvt. Ltd. -2.01m -3.89m Birla Sun Life Asset Management Company Ltd. 1.30m 3.23m Mellon Capital Management Corporation -0.67m -1.66m Subramaniam (Rajesh) 0.50m 1.25m Pramerica Asset Managers Pvt. Ltd. -0.36m -0.55m
.
Financial summary
Profit and loss statement | Crore
FY14 FY15E FY16E FY17E
Total Revenues 3,106 3,035 3,237 3,501 Growth (%) 10.2 (2.3) 6.7 8.1 Employee expenses 2,129 2,018 2,143 2,310
Other Expenses 614 636 664 700
EBITDA 362 381 431 490
Growth (%) 29.5 5.1 13.1 13.8 Depreciation & Amortization 76 72 74 77
Other Income 1 2 4 9
Interest 84 67 41 25
PBT before Exceptional Items 203 244 319 396
Growth (%) 27.7 20.0 30.8 24.2 Tax 10 10 29 44
PAT before Exceptional Items 193 234 290 352
Exeptional items - - - -PAT before MI 193 234 290 352
Minority Int & Pft. from associates 0 0 0 0
PAT 193 234 290 352
Growth (%) 31.6 21.4 23.8 21.4 EPS 2.8 3.3 4.2 5.1 EPS (Growth %) (0.4) 18.4 24.8 21.4 Source: Company, ICICIdirect.com Research Cash flow statement | Crore FY14 FY15E FY16E FY17E Profit before Tax 203 244 319 396
Depreciation & Amortization 76 72 74 77
WC changes 125 (105) 26 (5)
Other non cash adju. 34 86 37 16
CF from operations 396 246 427 441
Capital expenditure (36) (46) (115) (75)
Δ in investments (2) (62) -
-Other investing cash flow 24 4 4 9
CF from investing Activities (13) (104) (111) (66)
Issue of equity 3 11 -
-Δ in debt funds (209) (213) (270) (270)
Dividends paid - - - -Other financing cash flow (80) (44) (41) (25)
CF from Financial Activities (286) (246) (311) (295)
Δ in cash and cash bank balance 96 (105) 5 80
Effect of exchange rate changes - - - -Opening cash 89 185 80 86
Closing cash 185 80 86 165
Source: Company, ICICIdirect.com Research Balance sheet | Crore FY14 FY15E FY16E FY17E Equity 660 666 666 666
Reserves & Surplus 1,432 1,422 1,712 2,064 Networth 2,091 2,089 2,379 2,731 Minority Interest 1 2 2 2
LT liabilties & provisions 736 467 267 67
Source of funds 2,829 2,557 2,647 2,799 Net fixed assets 137 119 159 157
Goodwill 2,594 2,334 2,334 2,334 Other non current assets 211 231 231 231
Loans and advances 41 29 29 31
Current Investments 3 68 68 68
Debtors 302 289 299 323
Cash & Cash equivalents 186 80 86 165
Other current assets 216 278 286 305
Short term borrowings 246 316 246 176
Trade payables 113 93 100 108
Current liabilities 483 447 482 514
Provisions 19 14 16 17
Application of funds 2,829 2,557 2,647 2,799 Source: Company, ICICIdirect.com Research Key ratios (Year-end March) FY14 FY15E FY16E FY17E Per share data (|) EPS-diluted 2.8 3.3 4.2 5.1 Cash per share 2.7 1.1 1.2 2.4 BV 30.6 29.8 34.2 39.3 Operating profit per share 4.3 4.6 5.3 6.1 Operating Ratios (%) EBITDA Margin 11.7 12.5 13.3 14.0 PBT Margin 6.5 8.0 9.9 11.3 PAT Margin 6.2 7.7 9.0 10.1 Return Ratios (%) RoNW 9.2 11.2 12.2 12.9 RoCE 7.7 9.5 11.6 14.1 Valuation Ratios (x) P/E 11.0 9.3 7.4 6.1 EV / EBITDA 8.0 7.2 5.8 4.4 Price to Book Value 1.0 1.0 0.9 0.8 EV / Net Sales 0.9 0.9 0.8 0.6 Mcap / Net Sales 0.7 0.7 0.7 0.6 Turnover Ratios Debtor days 35 35 34 34
Creditors days 13 11 11 11 Solvency Ratios
Total Debt / Equity 0.4 0.3 0.2 0.1 Current Ratio 0.9 1.1 1.0 1.0 Quick Ratio 0.9 1.1 1.0 1.0 Debt / EBITDA 2.5 1.9 1.1 0.4 Source: Company, ICICIdirect.com Research
o
ICICIdirect.com coverage universe (IT)
CMP M Cap
(|) TP(|) Rating (| Cr) FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E
Cyient (INFENT) 542 500 Hold 6,092 31.4 34.0 40.0 17.3 15.9 13.5 13.5 11.0 8.6 22.2 21.9 22.4 19.2 18.1 18.6 Eclerx (ECLSER) 1,865 1,500 Sell 5,686 74.3 99.0 110.0 25.1 18.8 17.0 15.1 11.7 9.9 40.4 45.8 43.5 32.1 35.5 33.2 Firstsource (FIRSOU) 32 45 Buy 2,165 3.3 4.2 5.1 9.7 7.7 6.4 7.2 5.8 4.4 9.5 11.6 14.1 11.2 12.2 12.9 HCL Tech* (HCLTEC) 873 1,050 Buy 122,744 51.4 55.0 64.0 17.0 15.9 13.6 12.5 11.0 9.0 35.2 31.7 30.5 29.3 25.7 24.7 Infosys (INFTEC) 1,136 1,300 Buy 260,818 53.9 57.0 65.0 21.0 19.9 17.5 14.9 13.4 11.4 31.4 29.7 30.1 22.5 21.3 21.7 KPIT Tech (KPISYS) 137 135 Hold 2,703 11.9 12.5 14.0 11.6 11.0 9.8 8.3 6.6 5.6 14.7 17.4 17.4 17.0 15.4 14.9 Mindtree (MINCON) 1,568 1,600 Hold 13,143 63.9 75.0 96.0 24.5 20.9 16.3 17.0 14.0 11.2 33.7 32.9 34.3 26.6 25.9 26.9 NIIT Technologies (NIITEC) 595 525 Hold 3,634 31.8 42.0 47.5 18.7 14.2 12.5 8.2 5.9 4.9 23.4 29.8 31.9 14.3 16.6 16.6 Persistent (PSYS) 646 675 Hold 5,170 36.3 41.0 48.0 17.8 15.8 13.5 11.2 9.0 7.2 27.5 26.6 26.6 20.7 19.7 19.5 TCS (TCS) 2,499 2,800 Buy 492,410 110.8 119.0 130.0 22.6 21.0 19.2 17.2 15.2 13.4 81.8 77.3 74.6 42.8 36.1 31.9 Tech Mahindra (TECMAH) 541 600 Buy 52,223 26.7 29.0 36.0 20.2 18.6 15.0 11.8 11.6 9.3 26.9 24.9 26.5 21.5 19.4 20.4 Wipro (WIPRO) 572 680 Buy 141,170 35.1 37.0 40.5 16.3 15.4 14.1 11.6 10.4 9.1 23.0 22.6 22.4 21.2 19.7 19.1
RoE (%) Sector / Company
EPS (|) P/E (x) EV/EBITDA (x) RoCE (%)
RATING RATIONALE
ICICIdirect.com endeavours to provide objective opinions and recommendations. ICICIdirect.com assigns
ratings to its stocks according to their notional target price vs. current market price and then categorises them
as Strong Buy, Buy, Hold and Sell. The performance horizon is two years unless specified and the notional
target price is defined as the analysts' valuation for a stock.
Strong Buy: >15%/20% for large caps/midcaps, respectively, with high conviction;
Buy: >10%/15% for large caps/midcaps, respectively;
Hold: Up to +/-10%;
Sell: -10% or more;
Pankaj Pandey
Head – Research
[email protected]
ICICIdirect.com Research Desk,
ICICI Securities Limited,
1st Floor, Akruti Trade Centre,
Road No 7, MIDC,
Andheri (East)
Mumbai – 400 093
ANALYST CERTIFICATION
We /I, Abhishek Shindadkar, MBA, Research Analyst, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report.
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ICICI Securities or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from the date of this report for services in respect of managing or co-managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction. ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the companies mentioned in the report in the past twelve months.
ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts have any material conflict of interest at the time of publication of this report.
It is confirmed that Abhishek Shindadkar, MBA, Research Analyst of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months. Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.
ICICI Securities or its subsidiaries collectively or Research Analysts do not own 1% or more of the equity securities of the Company mentioned in the report as of the last day of the month preceding the publication of the research report.
Since associates of ICICI Securities are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject company/companies mentioned in this report.
It is confirmed that Abhishek Shindadkar, MBA, Research Analyst do not serve as an officer, director or employee of the companies mentioned in the report. ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report. Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned in the report.
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