16december2013 India Daily

INDIA DAILY
December 16, 2013
India
13-Dec 1-day1-mo 3-mo
Sensex
20,716
(1.0)
1.5
4.9
6,168
(1.1)
1.9
5.6
15,755
0.1
(1.3)
1.7
4,001
0.1
0.4
7.6
Nifty
Contents
Daily Alerts
Global/Regional indices
Dow Jones
Nasdaq Composite
Company
FTSE
6,440
(0.1) (3.8) (2.8)
Shriram Transport: Management meeting takeaways - cautious outlook
Nikkei
15,314
(0.6)
1.0
6.3
` Collections efficiency picks up, remains the key monitorable
Hang Seng
23,138
(0.5)
0.5
(0.5)
KOSPI
` Key drivers for NIMs in the short, medium and long term
Sector
Telecom: Spectrum chronicles - volume XIII: NIA for January 2014 auctions
issued
1,964
0.0 (2.1) (2.5)
Value traded India

Cash (NSE+BSE)
121
Derivatives (NSE)
1,308
1,458 1,252
132
134
Deri. open interest
1,485
1,375 1,495
` Key highlights of the NIA for January 2014 spectrum auctions

Forex/money market
Change, basis points
13-Dec 1-day
Rs/US$
10yr govt bond, %
1-mo
3-mo
62.0
(11)
(16)
(130)
9.3
(1)
35
Net investment (US$mn)

12-Dec
MTD CYTD
FIIs
39
1,270 18,729
MFs
(45)
(148) (4,008)
Top movers
Change, %
Best performers
13-Dec 1-day
1-mo
3-mo
ADE IN Equity
248.2
(1.5)
1.6
83.5
TCOM IN Equity
271.0
(1.4)
(3.0)
51.4
TPW IN Equity
109.3
(5.2)
3.8
51.2
SUEL IN Equity
9.4
(3.1)
3.3
43.5
TATA IN Equity
415.2
0.6
10.6
42.4
Worst performers
FTECH IN Equity
153.2
(1.9)
1.5
(17.0)
IOCL IN Equity
199.3
(1.7)
0.6
(14.1)
ESOIL IN Equity
51.5
(1.8)
1.7
(13.2)
CIPLA IN Equity
376.7
(1.1)
(6.5)
(12.5)
15.4
(1.3)
(7.2)
(11.5)
UT IN Equity
Kotak Institutional Equities Research

kotak.research@kotak.com . Mumbai: +91-22-4336-0000
For Private Circulation Only. FOR IMPORTANT INFORMATION ABOUT KOTAK SECURITIES RATING SYSTEM AND OTHER DISCLOSURES.
REFER TO THE END OF THIS MATERIAL.
ADD
Shriram Transport (SHTF)

Banks/Financial Institutions
DECEMBER 16, 2013

UPDATE
Coverage view: Cautious
Management meeting takeawayscautious outlook. At our recent meeting,

Shriram Transport Finance (STFC) management retained a cautious business outlook.
While incremental trends seem to be better, the management will await more signals to
get assertive on the business. We continue to build elevated credit costs and moderate
growth in our assumptions. We analyze various drivers of STFCs NIM over the short,
medium and long term. We find some downside to our near-term NIM assumptions as
cash on the balance sheet is high. We retain our ADD rating with a target price of `670.
Company data and valuation summary
Shriram Transport
Stock data
52-week range (Rs) (high,low)
843-464
Market Cap. (Rs bn)
137.8
Shareholding pattern (%)
Promoters
25.9
FIIs
49.7
MFs
0.5
Price performance (%)
1M
3M
12M
Absolute
9.7
8.5
(15.2)
Rel. to BSE-30
6.3
2.6
(21.6)
Forecasts/Valuations
EPS (Rs)
EPS growth (%)
P/E (X)
NII (Rs bn)
Net profits (Rs bn)
BVPS
P/B (X)
ROE (%)
Div. Yield (%)
2013
61.0
8.2
10.0
35.3
13.6
311.6
1.9
20.6
1.2
2014E
61.8
1.4
9.8
37.7
13.8
358.1
1.7
17.8
1.4
Price (`): 596

Target price (`): 670
BSE-30: 20,716
2015E
74.2
20.1
8.2
44.7
16.6
412.1
1.5
18.3
1.7
Collections efficiency picks up, remains the key monitorable

STFC said monthly collection efficiency improved considerably over August-September 2013,
reducing the risk of a significant rise in NPLs. According to industry sources, a strong monsoon in
August paralyzed CV transport in select pockets of the country. Coupled with weak overall
demand, CV operators could not make their EMI payments during August-September 2013.
However, monthly collections have improved since and hence the risk of NPLs is now lower.
Several borrowers are servicing monthly EMIs but are unable to cover the previous deficit; such
borrowers remain in the 1-2 month delinquency segment.
STFCs management will await business trends over the next two quarters to get more assertive on
the business. We believe the trend in collections, though improved, is the key monitorable. Any
further weakness will push borrowers towards the 4-6 month delinquency segment, or closer to
the NPL bucket. STFCs management highlighted that destruction of crops in select pockets (AP,
Bihar, Orissa) due to heavy rains would affect the December harvest and hence overall demand for
transport of its borrowers in that belt would be weak. Rising diesel prices and interest rates will
likely sustain pressure on the sector.
Key drivers for NIMs in the short, medium and long term
We expect STFC to deliver 7% NIM in the medium term. While cash on the balance sheet and
interest reversals on slippages are likely to put pressure on margins in the near term, a hike in
lending yields and focus on rural loans are expected to boost yields over time.
Higher cash provides downside risk to our near-term NIM estimates. STFCs NIM (calculated)
declined to 6.8% in 2QFY14 from 7.0% in 1QFY14. Higher cash on the balance sheet was a key
reason for lower NIM in 1QFY14. STFC raised `30 bn in bank loans (at ~100 bps higher rates) and
fully used the cash-credit limit; thus, cash on the balance sheet increased to `80 bn from `50-55
bn in 1QFY14. The management highlighted that cash on the balance sheet would stay high for
the next 1-2 quarters. As such, NIM expansion may be delayed. We model 7.1% NIM over the
next six quarters, which may have some downside in the next two quarters.
Nischint Chawathe
nischint.chawathe@kotak.com
Mumbai: +91-22-4336-0887
M.B. Mahesh, CFA

mb.mahesh@kotak.com
Mumbai: +91-22-4336-0886
Geetika Gupta
geetika.gupta@kotak.com
Mumbai: +91-22-4336-0888

kotak.research@kotak.com
Mumbai: +91-22-4336-0000
For private Circulation Only. FOR IMPORTANT INFORMATION ABOUT KOTAK SECURITIES RATING SYSTEM AND OTHER DISCLOSURES, REFER TO THE END OF THIS MATERIAL.
Shriram Transport
Benefit of rate hike may not be reflected soon. To offset the impact of higher
borrowings cost (up 50 bps qoq in 2QFY14), STFC raised lending rates by 50 bps in August.
The existing loan book carries a fixed rate and the higher rates are effective only on
incremental loans. Hence, the impact of higher rates will be visible after 2-3 quarters.
Well placed to deliver 7% NIM in the medium term. STFC earns gross asset yield of
about 17% (new CV loans yield 15% IRR, newer used CVs 16-17%, older used CVs 19%
and rural loans over 20%). Cost of borrowings on the balance sheet is about 11% while
securitized loans are 8.5-9% (30% of the loans under management are securitized). Thus,
the company is well placed to deliver about 7% gross spread. The negative impact from
cash on the balance sheet and income recognition on slippages will temper near-term NIMs.
Exhibit 1: STFC is likely to deliver 7% NIM in the medium term
Yield, cost of borrowings and NIM, March fiscal year-ends, 2008-2016E (%)
Yields on loans on balance sheet
Cost of borrowings
NIM
25
20
15
10
2008
2009
2010
2011
2012
2013
2014E
2015E
2016E
Source: Company, Kotak Institutional Equities estimates
Rural loans will boost yields over time. STFC has focused on 3-5 year-old used CV (newer
used CVs) which has pulled down asset yields but boosted loan growth, the yield on such
loans (16-17%) being higher than new CV loans (15%), but lower than older used CVs
(19%) and rural loans (20%-plus). The share of newer used CV loans is about 12% of total
loans. To offset the impact of lower rates on newer used CVs, the company has focused on
small-vehicle finance in rural India at higher rates (IRR of 20-21%). However, this segment is
only 3.5% of the total loan book. The rural business is challenging to grow in light of its
lower ticket size and difficulty in reaching out. STFC expects that over time the share of rural
loans will catch up with that of newer used CVs.
However, older used CVs finance under pressure. The newer used CVs emerged as a
new segment for STFC in FY2013. Initially, the company focused on this segment due to
liability-side challenges (as per new regulations, loans purchased from NBFCs with IRR over
8% on banks base rates cannot be considered for PSL; hence NBFCs need to focus on lowyield assets to tap securitization funds). However, STFCs traditional used-CV segment is
disadvantaged in the current market. With rising fuel prices, the demand for older used CVs
will remain weak unless freight rates increase sharply.
KOTAK INSTITUTIONAL EQUITIES RESEARCH
Shriram Transport
Loan growth to moderate, less dependence on CVs positive in the long run
STFC delivered AUM growth of 22% yoy in 2QFY14 (24% in March 2013) led by growth in
used-CV disbursements; new-CV loans declined by 6% qoq in 2QFY14 due to a 9% qoq
decline in 1QFY14. We model 15% loan growth in FY2014E and 18% growth in FY2015E.
We believe STFC is well placed to deliver 15-18% loan growth over time due to 10-12%
growth in CVs, increase in product lines and higher share in the business.
STFC has reduced dependence on CVs. Over the years, STFC has tried to reduce focus on
CVs. Currently CVs comprise only 72% of consolidated loans under management (75% of
standalone balance sheet loans). The other asset classes include (1) construction equipment
(10% of consolidated loans, 5% of standalone loans under management), (2) passenger
vehicles (about 8%) and (3) MUVs (about 5%).
Capital infusion in equipment-finance business on the cards

Capital infusion in equipment-finance business. According to unauthenticated media
reports, Shriram Equipment Finance (SEF) proposes to raise equity and divest partial stake to
financial investors. The company had a loan book of `33 bn and net worth of `4.5 bn as of
2QFY14; it proposes to raise `1.5-2 bn. Exhibit 2 shows that the business will be valued at
`8-14 bn (post money) assuming valuation at 1-2X PBR FY2015E. STFCs stake in the
business will reduce to 80-90%. We are not assigning any value to the equipment-finance
business in our valuation of STFC. The business will likely add `28-56/share of STFC, or 48% to the target price if we assume the aforesaid valuation.
Exhibit 2: SEF is likely to add 4-8% to STFCs target price
SEFs post-dilution valuation and contribution to STFCs target price, March fiscal year-end, 2015E
SEF 2015E book value pre-dilution (Rs mn)

Pre-money valuation (Rs mn)
Capital infusion assumed (Rs mn)
Value of SEF post-dilution (Rs bn)
STFC's stake in SEF after infusion (%)
SEF vlaue for STFC (Rs mn)
Value per share of STFC (Rs)
% of STFC's target price
Scenario I
Scenario II
Scenario III
(1X PBR)
6,239
6,239
1,500
7,739
(1.5X PBR)
6,239
9,359
1,500
10,859
(2X PBR)
6,239
12,479
1,500
13,979
81
6,239
28
4.2
86
9,359
42
6.3
89
12,479
56
8.3
High growth in recent years on a low base. The company has delivered 58% CAGR in
loan book over the past two years, largely due to used-CE finance. Disbursements grew
19% yoy in 2QFY14 to `4.9 bn, led by growth in disbursements in used CV (grew 149% yoy)
while disbursements in new CEs declined 25% yoy.
High credit losses pose a challenge. SEFs gross NPLs peaked at 1.4% in 4QFY13 and
stabilized at 0.8-1% of loans in 1HFY14; however credit cost (to average loans) ratio was
1.9% in 2QHFY14 and 0.9% in FY2013. The company reported 25% RoE in FY2013, which
declined to 21% in 2QFY14 (annualized) due to higher credit costs. In the light of high
credit costs and a challenging environment for construction equipment, SEF may find it
challenging to conclude the placement in the current environment.
Long history of equipment finance. STFC was engaged in the construction equipment
finance business for several years; until 4QFY11 the business was booked in the parent
company. As of 4QFY13, construction equipment represented 10% of the consolidated
loans assets, out of which 4% were on the balance sheet of SEF and balance of the parent.
Shriram Transport
Exhibit 3: Shriram Equipment Finance quarterly data

March fiscal year-ends, 1QFY12-2QFY14
Income statement (Rs mn)
Revenue from operations
Interest costs
Net interest income
Operating expenses
Employee expenses
Other expenses
PPOP
Provisions
PBT
Provision for tax
PAT
NPLs
Gross NPL (Rs mn)
Gross NPL (%)
Net NPL (Rs mn)
Net NPL (%)
Per share (Rs)
BPS (Rs)
EPS (Rs)
Key ratios (%)
ROA (%)
ROE (%)
NIM-KS (%)
Key loan book/ balance sheet highlights
Total disbursement (Rs mn)
Used CE
New CE
AUMs (Rs mn)
Total assets (Rs mn)
Shareholders equity (Rs mn)
ROE decomposition (% of assets)
NII
Other income
Total income
Operating costs
Credit costs
ROA pre-tax
ROA
Average assets/ average equity (X)
RoE
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
331
144
187
65
36
27
123
9
114
39
74
464
204
260
65
39
25
195
10
185
61
124
580
277
304
73
39
32
231
13
218
71
147
725
338
388
92
58
33
296
42
254
82
172
835
423
413
103
62
40
309
48
261
85
176
957
499
458
110
65
44
349
22
327
106
221
1,069
532
537
115
65
48
422
33
389
126
263
1,186
604
582
130
77
52
455
110
345
112
233
1,289
682
606
145
94
49
461
75
386
130
256
1,346
706
639
136
80
55
503
152
352
119
232
2
0.0
2
0.0
15
0.1
14
0.1
54
0.4
46
0.3
51
0.3
15
0.1
115
0.5
38
0.2
126
0.5
34
0.1
161
0.6
48
0.2
420
1.4
234
0.8
252
0.8
95
0.3
318
1.0
129
0.4
19
7
31
12
46
15
63
17
80
18
102
22
129
26
152
23
178
26
201
23
3.2
13.8
4.1
18.0
9.3
4.2
20.4
8.7
4.0
22.6
9.0
3.4
21.9
8.1
3.9
25.9
8.1
4.1
28.8
8.4
3.2
23.9
8.1
3.2
24.7
7.8
2.8
21.1
8.0
3,758
731
3,027
9,575
11,038
2,685
3,857
788
3,069
12,891
12,958
2,809
3,325
763
2,562
15,059
15,191
2,956
5,467
863
4,604
19,234
19,385
3,127
3,782
776
3,006
21,418
21,532
3,304
4,090
1,035
3,055
23,809
24,065
3,525
5,812
1,655
4,158
27,253
27,520
3,788
6,233
1,558
4,675
30,412
30,715
4,020
4,170
1,421
2,750
31,527
32,890
4,276
4,871
2,580
2,291
32,113
33,133
4,508
6.8
0.0
6.8
2.3
0.3
4.1
2.7
4.1
11.0
8.7
8.7
2.2
0.3
6.2
4.1
4.4
18.0
8.6
0.0
8.6
2.1
0.4
6.2
4.2
4.9
20.4
9.0
0.0
9.0
2.1
1.0
5.9
4.0
5.7
22.6
8.1
8.1
2.0
0.9
5.1
3.4
6.4
21.9
8.0
0.0
8.0
1.9
0.4
5.7
3.9
6.7
25.9
8.3
0.0
8.3
1.8
0.5
6.0
4.1
7.1
28.8
8.0
0.0
8.0
1.8
1.5
4.7
3.2
7.5
23.9
7.6
0.0
7.6
1.8
0.9
4.9
3.2
7.7
24.7
7.7
0.0
7.7
1.6
1.8
4.3
2.8
7.5
21.1
Source: Company, Kotak Institutional Equities
Shriram Transport
Exhibit 4: STFC trades at 1.5X PBR

One-year forward rolling PER and PBR, December 2007-December 2013
Rolling PER (X) (LHS)
Rolling PBR (X) (RHS)
Jun-12
Dec-13
0
Jun-13
0
Dec-12
Dec-11
Jun-11
Dec-10
Jun-10
Dec-09
12
Jun-09
Dec-08
16
Jun-08
Dec-07
20
Source: Company, Bloomberg, Kotak Institutional Equities estimates
Exhibit 5: Shriram Transport Finance - key ratios

March fiscal year-ends, 2011-2016E (%)
Growth in key parameters (%)

Loans under management
Total assets
Borrowings
Net interest income
Operating expenses
Key ratios(%)
NII/ AUMs(%)
Operating expenses/total income
Tax rate
Dividend payout ratio
Debt/ equity (X)
Du Pont Analysis
(% of average AUMs)
Net interest income
Loan loss provisions
Net other income
Operating expenses
(1- tax rate)
ROA
Average AUMs/average equity (X)
ROE
2011
2012
2013
23.8
17.2
7.7
37.9
65.5
11.2
13.2
16.3
14.1
4.4
23.8
25.3
34.1
0.7
(13.3)
9.4
27.8
33.5
13.9
4.05
9.2
26.4
33.1
13.6
3.86
7.9
22.4
32.5
13.6
4.31
9.4
1.6
0.7
2.8
66.5
3.8
7.5
28.1
9.2
2.0
0.3
2.5
66.9
3.3
7.0
23.1
7.9
1.9
0.4
1.8
67.5
3.0
6.8
20.6
Shriram Transport
Exhibit 6: Shriram Transport Finance - income statement and balance sheet

March fiscal year-ends, 2011-2016E (` mn)
2011
Income statement
Total interest income
Total interest expense
Net interest income
Provisions and write/off
Net interest income (after prov.)
Other income
Operating expenses
Employee expenses
Depreciation
Advt and commission/brokerage
Sourcing and collection commission
Other expenses
Pretax income
Tax provisions
Net Profit
% growth
EPS (Rs)
% growth
BPS (Rs)
ABVPS (Rs)
Balance sheet
Total Loans
Investments
Cash & deposits
Loans and advances
Net fixed assets
Other current assets
Total assets
Total Borrowings
Current liabilities
Provisions
Total liabilities
Share capital
Reserves
Shareholders fund
Truck AUM
2012
2013
2014E
2015E
2016E
51,848
21,164
30,684
5,235
25,449
2,162
9,121
3,582
108
109
5,322
18,490
6,190
12,300
41
55
41
220
216
57,923
22,919
35,004
7,683
27,321
1,015
9,524
3,701
135
241
25
5,423
18,812
6,234
12,578
2
56
2
269
264
63,955
28,703
35,251
8,508
26,743
1,680
8,262
3,848
183
236
30
3,965
20,161
6,556
13,606
8
61
8
322
312
71,878
34,165
37,713
10,265
27,448
2,350
9,800
4,566
186
259
30
4,758
19,997
6,199
13,798
1
62
1
374
358
84,097
39,427
44,670
11,287
33,383
2,500
11,871
5,686
159
285
30
5,710
24,012
7,444
16,568
20
74
20
436
412
100,244
46,778
53,466
13,844
39,622
2,750
14,103
6,746
161
314
30
6,852
28,269
8,763
19,506
18
87
18
509
480
197,690
80
36,251
1,590
384
42,125
316,084
198,817
55,720
12,503
267,040
2,231
46,782
49,044
360,860
220,821
80
53,812
8,753
377
32,247
357,721
231,274
51,052
15,527
297,852
2,231
57,659
59,922
401,280
311,227
80
63,193
32,311
600
2,473
448,332
310,024
48,405
17,955
376,384
2,231
69,679
71,947
496,760
373,107
80
62,623
35,542
49
2,473
512,322
334,604
70,890
23,342
428,836
2,231
81,217
83,486
568,108
462,970
80
63,500
39,097
(129)
2,473
606,438
409,308
69,445
30,344
509,098
2,231
95,071
97,340
668,628
562,488
80
64,529
43,006
(253)
2,473
710,770
473,298
84,373
39,448
597,119
2,231
111,382
113,651
780,652
Telecom
India
ATTRACTIVE
DECEMBER 16, 2013
UPDATE
BSE-30: 20,716
Spectrum chroniclesvolume XIII: NIA for January 2014 auctions issued. The
Department of Telecommunications (DOT) has released a notice inviting applications
(NIA) for the upcoming January 2014 spectrum auctions. These auctions would see
1,800 MHz spectrum being auctioned in all 22 circles and 900 MHz spectrum being
auctioned in three circles (Delhi, Mumbai and Kolkata). The auctions are slated to
commence on January 23, 2014.
Key highlights of the NIA for January 2014 spectrum auctions

` 1,800 MHz spectrum will be auctioned in all 22 circles. The quantum of spectrum varies from as
low as 2.4 MHz (paired) in UP (West) to as high as 30.2 MHz in the Tamil Nadu (including
Chennai) circle. 1,800 spectrum being put up for auction includes the current 1,800 spectrum
holdings of Bharti/Vodafone in Delhi and Kolkata and Vodafone/Loop in Mumbai (no spectrum
reservation for current operatorsthey will have to buy spectrum in the auctions to continue
operations).
` 900 MHz spectrum will be auctioned in Delhi, Mumbai and Kolkata16 MHz (paired) each in
Delhi and Mumbai and 14 MHz in Kolkata. None of this is fresh spectrum, but essentially
spectrum currently being used by the 1995 licensees, Bharti/Vodafone in Delhi and Kolkata and
Vodafone/Loop in Mumbai.
` Simultaneous ascending e-auctions for 1,800 MHz and 900 MHz auctions. This is similar to the
process followed in the past auctions (3G and BWA auctions in 2010, November 2012 and
March 2013 auctions).
` Bidding block defined as 200 KHz in the 1,800 band and 1 MHz in the 900 band. To illustrate,
this means 151 200-KHz blocks will be auctioned in the 1,800 band in the Tamil Nadu circle
and 16 1-MHz blocks will be auctioned in the 900 band in the Delhi circle. Reserve prices have
been set at the bidding block level.
` Minimum bid quantum. Three blocks (or 0.6 MHz) for an existing player and 25 blocks (or
5 MHz) for a new entrant in the 1,800 band. A minimum of five blocks for all players in the 900
band; there are no existing players for the purpose of 900 band auctions as the players whose
licenses are expiring would be considered new players for the purpose of spectrum auctions in
those circles. However, a player whose license is not expiring but currently holds either 900 or
1,800 band spectrum in a circle would be considered an existing operator for both 900 and
1,800 auctions (for that circle).
` Maximum bid quantum. This is governed by spectrum caps; no player can have more than 25%
of the total spectrum (across bands) in any circle and more than 50% of spectrum in a
particular band in any circle. Spectrum bids would be added to the current spectrum holdings
to test this cap.
` Key dates. Pre-bid conference on December 20, 2013; last date for applicationsJanuary 4,
2014; publication of list of applicantsJanuary 7, 2014; publication of final list of approved
biddersJanuary 16, 2014; commencement of auctionsJanuary 23, 2014; payment of
successful bid amountswithin 10 calendar days of the close of the auction.
Rohit Chordia
rohit.chordia@kotak.com
Mumbai: +91-22-4336-0885
Shyam M.
shyam.m@kotak.com
Mumbai: +91-22-4336-0862

kotak.research@kotak.com
Mumbai: +91-22-4336-0000
For private Circulation Only. FOR IMPORTANT INFORMATION ABOUT KOTAK SECURITIES RATING SYSTEM AND OTHER DISCLOSURES, REFER TO THE END OF THIS MATERIAL.
Telecom
India
` Payment terms. There are two options(1) full upfront payment and (2) deferred
payment option. Upfront payment of 25% of bid amount in case of 900 and 33% in case
of 1,800, followed by 10 equal annual installments after a two-year moratorium. Interest
rate applied to compute the equal annual installment is set at 10%. Choice of payment
option by successful bidders will have a bearing on auction collection for the exchequer
from a fiscal target perspective. Total proceeds, if all spectrum is sold at reserve prices,
would be around `487 bn; cash proceeds, if all successful bidders opt for the deferred
payment option would be `151 bn.
` Discovered spectrum prices (for circles where these auctions succeed) shall remain
current/applicable for a year from the date of these auctions. Any scenario (an M&A or
an operator wanting to liberalize its spectrum holdings) beyond a year would use these
discovered prices adjusted upwards by using SBI PLR as the reference rate.
Exhibits 1-3 depict the NIA details of 900 and 1,800 auctions and their respective timelines.
We shall publish thoughts on how we see these auctions panning out and the
import of the outcome in the run-up to the auctions over the next month. In any
case, the base case assumption built into our fair value computation for wireless
stocks (1,800 clears at reserve prices and 900 at about a 50% premium to reserve
prices) builds in ample conservatism. We stay positive on Bharti and Idea.
Exhibit 1: Details of the 1,800 MHz auctions
Circle
Andhra Pradesh
Assam
Bihar
Delhi
Gujarat
Haryana
Himachal Pradesh
Jammu & Kashmir
Karnataka
Kerala
Kolkata
Madhya Pradesh
Maharashtra
Mumbai
North East
Orissa
Punjab
Rajasthan
Tamilnadu
UP (East)
UP (West)
West Bengal
Total
Spectrum quantity
Blocks (#)
MHz
113
22.6
57
11.4
21
4.2
114
22.8
60
12.0
82
16.4
102
20.4
31
6.2
123
24.6
140
28.0
134
26.8
96
19.2
70
14.0
126
25.2
26.8
134
140
28.0
92
18.4
104
20.8
151
30.2
49
9.8
12
2.4
65
13.0
2,016
403.2
Reserve price (Rs mn)

per block
per MHz
326
1,630
14
70
74
370
438
2,190
286
1,430
54
270
12
60
10
50
310
1,550
104
520
146
730
86
430
346
1,730
414
2,070
14
70
32
160
108
540
52
260
416
2,080
122
610
124
620
42
210
3,530
17,650
EMD per block

(Rs mn)
73
5
15
73
73
15
5
5
73
30
30
15
73
73
5
15
30
15
73
30
30
15
768
Eligibility points
per block
55
3
10
55
55
10
3
3
55
22
22
10
55
55
3
10
22
10
55
22
22
10
567
Notes:
(1) Each block is of 200 KHz.
Source: DoT, Kotak Institutional Equities
India
Telecom
Exhibit 2: Details of the 900 MHz auction
Circle
Delhi
Kolkata
Mumbai
Total
Quantum
(MHz)
16.0
16.0
14.0
46.0
Reserve price
(Rs mn/ MHz)
3,600
1,250
3,280
8,130
EMD per block

(Rs mn)
345
188
345
878
Eligibility points
per block
300
150
300
750
Exhibit 3: Timeline of auction-related events
Date
December 12, 2013
Event
Issue of Notice Inviting Applications (NIA)
December 20, 2013
Pre-bid conference
December 24, 2013
Last date for seeking clarifications on NIA
December 28, 2013
Clarifications to NIA
January 4, 2014
Last date for submission of applications
January 7, 2014
Publication of ownership details of applicants
January 10, 2014
Bidder Ownership Compliance Certificate
January 14, 2014
Pre-qualification of bidders
January 16, 2014
Final list of bidders
January 21-22, 2014
Mock auction
January 23, 2014
Start of the auction
Within 10 calendar days of close of auction
Payment of the successful bid amounts
10
Kotak Institutional Equities: Valuation summary of KIE Universe stocks

11
Company
Automobiles
Amara Raja Batteries
13-Dec-13
Price (Rs)
345
Rating
ADD
Mkt cap.
(Rs mn)
(US$ mn)
58,939
950
O/S
shares
(mn)
2013
EPS (Rs)
2014E 2015E
EPS growth (%)

2013
2014E
2015E
33.3
19.5
12.0
2013
PER (X)
2014E
20.6
17.2
2015E
15.4
EV/EBITDA (X)
2013 2014E 2015E
12.3
10.4
Price/BV (X)
2013
2014E 2015E
4.5
2013
2015E
Target
price
(Rs)
Upside
(%)
ADVT3mo
(US$ mn)
171
16.8
20.1
22.5
8.8
5.6
0.7
1.2
1.3
28.8
26.1
340
(1.5)
Apollo Tyres
82
REDUCE
41,335
666
504
12.2
16.0
17.0
49.5
31.4
6.4
6.7
5.1
4.8
4.4
3.6
2.7
1.1
0.9
0.8
0.6
0.8
0.9
19.7
21.3
18.7
64
(22.0)
5.9
16
REDUCE
43,236
697
2,661
0.5
(2.1)
0.3
(74.5)
(479.9)
116.8
30.0
(7.9)
46.9
9.8
38.3
9.8
0.9
1.0
1.0
3.7
12.6
(16.7)
3.1
15
(7.7)
3.0
BUY
551,379
12.3
38.1
13.4
289
105.2
118.9
144.2
1.3
10.4
6.9
2,500
31.2
Bharat Forge
307
SELL
72,768
1,173
237
11.3
17.3
18.1
(35.2)
53.2
4.8
27.2
17.8
17.0
11.7
8.8
8.3
2.8
2.5
2.2
1.1
1.0
1.1
13.5
12.4
13.7
270
(12.0)
114
ADD
96,985
1,564
850
6.2
6.8
8.1
13.4
11.3
18.5
18.6
16.7
14.1
12.3
10.8
9.3
2.8
2.5
2.2
1.4
1.5
1.8
16.1
16.0
16.9
135
18.3
3.0
Hero Motocorp
2,061
REDUCE
411,572
6,636
200
106.1
109.6
143.2
(10.9)
3.4
30.7
19.4
18.8
14.4
15.6
13.2
9.7
7.6
6.0
4.8
2.9
1.6
2.4
44.0
37.4
38.6
2,000
(3.0)
11.6
1,905
8,890
15.0
13.2
13.3
13.3
9.3
3.5
3.1
2.7
1.5
2.5
1.8
3.0
2.0
43.2
24.4
38.5
20.6
2.3
BUY
534,304
8,615
562
63.0
63.2
71.5
10.4
10.5
20.1
1,130
18.9
17.4
510,394
8,230
302
79.2
91.6
103.0
39.9
15.7
12.5
21.3
18.4
16.4
12.9
10.5
8.8
2.7
2.4
2.1
0.5
0.6
0.7
13.9
13.7
13.7
1,440
(14.8)
19.5
BUY
167,639
2,703
588
7.6
13.2
20.3
71.2
74.1
54.0
37.7
21.7
14.1
11.8
8.6
5.5
7.3
5.5
3.8
0.7
1.4
2.1
26.8
36.8
32.4
305
7.0
2.0
Tata Motors
370
ADD
1,191,730
19,215
3,218
30.7
44.0
51.1
(31.1)
43.1
16.2
12.0
8.4
7.2
6.2
4.7
4.0
3.0
2.2
1.7
0.5
27.5
30.4
26.2
405
9.4
49.6
Neutral
64.8
Automobiles
15.1
16.0
REDUCE
951
1,690
13.1
18.1
285
Maruti Suzuki
0.2
21.2
Motherson Sumi Systems
Mahindra & Mahindra
22.7
13.1
2.4
1.5
Exide Industries
Bajaj Auto
4.6
30.4
RoE (%)
2014E
Ashok Leyland
5.6
3.6
Dividend yield (%)

2013 2014E 2015E
3,680,281
59,340
(10.3)
25.4
14.5
15.4
12.3
10.7
8.8
7.2
5.9
3.5
2.8
2.3
1.3
1.0
1.3
22.7
22.9
21.5
1,240
ADD
580,170
9,355
468
110.7
117.3
131.8
7.8
5.9
12.4
11.2
10.6
9.4
1.8
1.6
1.4
1.5
1.7
2.2
18.5
15.6
15.5
1,200
(3.2)
695
BUY
110,604
1,783
159
103.4
86.1
88.2
9.1
(16.8)
2.5
6.7
8.1
7.9
1.4
1.2
1.1
2.0
2.0
2.0
25.7
16.3
14.6
825
18.7
Bank of Baroda
660
REDUCE
279,009
4,499
423
106.0
90.9
112.5
(12.7)
(14.3)
23.7
6.2
7.3
5.9
1.0
1.0
0.9
3.2
2.8
3.4
15.6
11.8
13.3
620
(6.1)
21.0
Bank of India
209
ADD
124,907
2,014
597
46.1
48.4
59.4
(1.1)
5.1
22.6
4.5
4.3
3.5
0.7
0.6
0.6
4.8
5.0
6.1
12.9
12.1
13.5
220
5.1
16.1
Canara Bank
11.0
Axis Bank
Bajaj Finserv
0.5
252
REDUCE
115,550
1,863
459
64.8
40.7
62.5
(12.5)
(37.2)
53.5
3.9
6.2
4.0
0.6
0.6
0.5
5.0
4.8
4.8
12.1
7.3
10.4
255
1.3
City Union Bank
48
BUY
25,896
418
539
6.0
6.8
7.0
(13.0)
13.9
2.6
8.0
7.1
6.9
1.6
1.3
1.1
1.8
2.1
2.1
22.3
19.7
16.9
60
24.9
Development Credit Bank
49
BUY
12,356
199
250
4.1
6.1
6.4
78.3
50.3
3.9
12.1
8.1
7.8
1.3
1.2
1.0
11.6
15.0
13.5
60
21.5
0.9
Federal Bank
77
BUY
65,900
1,063
855
9.8
8.1
11.7
7.9
(17.1)
43.9
7.9
9.5
6.6
1.1
1.0
0.9
2.3
1.9
2.8
13.9
10.5
13.7
85
10.3
4.2
807
ADD
1,247,595
20,116
1,546
31.4
36.1
41.1
12.3
15.2
13.7
25.7
22.3
19.6
5.0
4.5
4.0
1.5
1.8
2.0
22.0
21.1
21.4
850
5.4
42.9
26.7
HDFC
HDFC Bank
ICICI Bank
IDFC
690
REDUCE
1,641,680
26,470
2,379
28.3
35.8
44.5
28.4
24.3
24.4
19.3
15.5
4.6
3.9
3.3
0.8
1.0
1.3
20.3
21.6
22.6
650
(5.8)
1,085
REDUCE
1,251,695
20,182
1,154
72.2
77.4
82.7
28.7
7.2
6.9
15.0
14.0
13.1
1.9
1.8
1.7
1.8
2.1
2.3
13.1
12.8
12.6
1,250
15.2
67.8
156,302
2,520
1,512
12.1
13.5
15.0
18.1
10.9
11.6
8.5
7.7
6.9
1.1
1.0
0.9
2.5
2.5
2.8
14.2
14.1
14.1
140
35.5
19.4
ADD
18,115
292
304
9.2
9.0
10.0
102.9
(2.8)
11.5
6.5
6.6
6.0
0.9
0.8
0.7
5.1
2.6
2.9
15.1
14.1
13.9
65
9.2
0.2
BUY
217,906
3,513
523
20.3
24.6
28.4
18.3
21.1
15.4
20.5
17.0
14.7
3.0
2.6
2.3
0.7
0.9
1.0
18.3
17.0
16.3
470
12.8
20.5
ADD
106,965
1,725
103
BUY
India Infoline
60
IndusInd Bank
417
ING Vysya Bank
0.4
185
39.6
36.8
43.9
30.2
19.3
14.6
15.7
13.2
2.4
1.5
1.4
0.8
0.9
1.1
14.6
11.9
11.2
620
7.1
1.4
REDUCE
60,310
972
48
217.6
233.0
207.1
31.4
7.1
(11.1)
5.7
5.3
6.0
1.2
1.1
1.0
4.0
4.3
3.8
23.6
21.4
16.6
1,250
0.5
1.5
Karur Vysya Bank
332
ADD
35,605
574
107
51.3
27.8
63.3
9.7
(45.8)
127.3
6.5
11.9
5.2
1.2
1.2
1.0
4.2
2.1
4.8
19.0
9.4
19.2
380
14.4
1.2
LIC Housing Finance
198
ADD
100,106
1,614
505
20.3
24.7
27.8
11.9
21.9
12.7
9.8
8.0
7.1
1.6
1.4
1.2
2.0
2.5
2.8
16.8
17.9
17.6
250
26.1
11.3
121,405
J&K Bank
L&T Finance Holdings
Muthoot Finance
1,244
71
SELL
1,958
1,715
3.8
5.0
60.3
(10.1)
29.9
64
BUY
12,132
196
190
6.5
8.1
11.0
100.6
23.8
36.3
9.8
7.9
5.8
0.9
0.8
0.7
1.7
2.1
2.7
10.1
10.4
13.0
110
72.3
0.1
299
REDUCE
169,846
2,739
568
15.5
18.6
21.3
28.6
20.0
14.5
19.2
16.0
14.0
3.9
3.4
2.9
1.2
1.5
1.7
23.8
21.9
21.4
240
(19.7)
3.9
41,334
666
4.3
(7.1)
16.6
18.5
14.3
2.2
1.9
1.7
14.3
11.3
26.2
12.7
60
(15.3)
4.3
104
NR
397
28.2
29.9
34.9
17.3
6.1
16.7
3.7
3.5
3.0
1.1
0.8
0.6
3.8
4.3
5.0
31.2
23.7
Oriental Bank of Commerce
209
ADD
61,109
985
292
45.5
35.5
52.2
16.3
(22.1)
47.4
4.6
5.9
4.0
0.6
0.6
0.5
4.4
3.4
5.0
10.7
7.9
10.8
170
(18.8)
7.2
PFC
146
BUY
192,952
3,111
1,319
33.5
35.9
39.3
45.6
7.2
9.3
4.4
4.1
3.7
0.8
0.8
0.7
4.8
5.1
5.6
19.8
18.3
17.5
185
26.5
6.4
10.5
565
REDUCE
199,748
3,221
353
134.3
97.0
133.8
(6.7)
(27.8)
37.9
4.2
5.8
4.2
0.8
0.7
0.7
4.8
3.5
4.8
13.3
550
(2.7)
18.3
Reliance Capital
360
ADD
88,605
1,429
246
26.9
18.6
27.4
27.5
(30.8)
47.4
13.4
19.3
13.1
0.8
0.8
0.7
2.2
1.6
2.3
5.9
3.9
5.6
480
33.4
20.0
Rural Electrification Corp.
203
ADD
200,835
3,238
987
38.7
44.7
47.6
35.3
15.5
6.5
5.3
4.6
4.3
1.2
1.1
1.0
4.1
3.9
4.6
23.7
23.0
20.6
250
22.9
5.3
NR
62,817
1,013
59
81.2
84.0
104.4
23.4
3.5
24.3
13.1
12.6
10.2
2.8
2.2
1.9
0.7
1.0
1.3
22.6
19.5
19.9
0.3
ADD
133,237
2,148
223
61.0
61.8
74.2
8.2
1.4
20.1
9.8
9.7
8.0
1.9
1.7
1.4
1.2
1.4
1.7
20.6
17.8
18.3
670
12.2
3.6
ADD
206.2
162.1
193.2
1,950
Punjab National Bank
Shriram City Union Finance

Shriram Transport
1,062
597
1,211,400
19,532
695
18.2
(21.4)
10.8
9.0
1.6
1.5
1.4
2.7
2.6
15.4
10.9
11.8
Union Bank
119
ADD
71,019
1,145
597
36.0
27.5
36.4
11.5
(23.7)
32.7
3.3
4.3
3.3
0.5
0.5
0.5
6.7
5.1
6.8
15.0
10.0
12.2
140
17.6
11.2
Yes Bank
366
REDUCE
131,112
2,114
359
36.3
33.3
39.5
31.0
(8.3)
18.8
10.1
11.0
9.3
2.3
1.9
1.7
1.6
1.5
1.8
24.8
20.2
19.3
320
(12.5)
70.7
16.0
State Bank of India
1,744
19.2
8.5
2.5
16.5
11.8
70.4
8,848,224
142,667
17.8
(2.0)
18.3
10.8
11.0
9.3
1.8
1.7
1.5
2.0
2.1
2.4
16.7
15.1
REDUCE
205,137
3,308
188
73.7
49.5
59.2
29.1
(32.8)
19.4
14.8
22.0
18.5
9.0
11.8
9.1
2.6
2.5
2.3
3.2
2.1
2.1
19.5
12.2
13.5
1,100
0.7
6.2
SELL
271,896
4,384
1,522
10.3
7.7
9.5
32.8
(25.5)
23.9
17.3
23.2
18.7
9.7
13.4
11.7
2.9
2.8
2.7
1.5
1.5
2.4
17.8
12.3
14.4
155
(13.2)
5.5
244,690
13.6
11.9
11.2
Cautious
Cement
ACC
Ambuja Cements
Grasim Industries
1,092
179
3,945
92
279.0
(5.6)
(1.3)
3.8
9.8
9.9
9.6
7.3
6.5
5.2
1.2
1.1
1.0
0.9
1.3
1.3
3,000
12.5
3.7
India Cements
58
ADD
17,816
287
307
6.8
3.5
5.9
(24.4)
(48.9)
70.1
8.6
16.8
9.9
4.4
5.5
4.3
0.4
0.4
0.4
3.7
4.6
4.7
5.2
2.6
4.3
70
20.7
1.7
Shree Cement
4,367
SELL
152,143
2,453
35
307.0
256.7
299.5
92.3
(16.4)
16.7
14.2
17.0
14.6
9.4
10.1
8.9
4.1
3.5
2.9
0.5
0.5
0.5
33.3
21.9
21.6
3,950
(9.6)
0.9
UltraTech Cement
1,801
REDUCE
493,716
7,961
274
101.3
87.6
105.5
13.4
(13.5)
20.4
17.8
20.6
17.1
11.0
11.4
9.1
2.9
2.5
2.2
0.6
0.6
0.6
18.9
14.7
15.5
1,650
(8.4)
4.8
1,385,398
22,338
16.2
(16.2)
15.9
14.6
17.4
15.0
8.8
9.6
7.8
2.2
2.0
1.8
1.2
1.2
1.3
15.3
11.7
12.3
Cement
2,666
ADD
Cautious
272.4
268.9
India Daily Summary - December 16, 2013
Magma Fincorp
Mahindra & Mahindra Financial
579
38.6
Asian Paints
Bajaj Corp.
Colgate-Palmolive (India)
Dabur India
GlaxoSmithKline Consumer
13-Dec-13
Price (Rs)
494
Rating
SELL
Mkt cap.
(Rs mn)
(US$ mn)
473,941
7,642
O/S
shares
(mn)
2013
EPS (Rs)
2014E 2015E
EPS growth (%)

2013
2014E
2015E
2013
PER (X)
2014E
2015E
EV/EBITDA (X)
2013 2014E 2015E
Price/BV (X)
2013
2014E 2015E
13.4
11.2
9.5
Dividend yield (%)

2013 2014E 2015E
2013
RoE (%)
2014E
2015E
Target
price Upside
(Rs)
(%)
ADVT3mo
(US$ mn)
959
11.6
13.1
15.3
12.7
12.9
16.9
42.5
37.7
32.2
27.0
22.7
19.4
0.9
1.1
1.4
36.3
34.0
33.6
440
(10.9)
10.3
205
BUY
30,193
487
148
11.3
13.0
15.6
38.4
15.8
19.6
18.2
15.7
13.1
16.5
14.6
11.6
6.3
5.5
4.9
3.2
3.7
4.4
26.4
32.3
33.0
295
44.1
0.4
1,264
SELL
171,868
2,771
136
36.5
35.5
41.5
11.3
(2.7)
16.7
34.6
35.6
30.5
25.5
25.6
21.1
36.8
30.1
28.2
2.2
2.2
2.6
107.4
89.2
92.0
1,200
(5.0)
3.0
166
ADD
288,886
4,658
1,743
4.4
5.4
6.4
19.0
22.6
18.8
37.6
30.7
25.8
29.6
24.7
20.8
13.6
10.9
8.8
0.9
1.2
1.4
40.0
39.4
37.6
190
14.6
4.5
4,451
SELL
187,179
3,018
42
103.9
123.0
146.3
23.0
18.4
19.0
42.9
36.2
30.4
37.1
33.2
27.7
14.4
12.2
10.4
1.0
1.3
1.6
34.9
35.0
35.6
4,100
(7.9)
0.9
Godrej Consumer Products
819
REDUCE
278,723
4,494
340
20.3
23.6
29.6
20.4
16.5
25.2
40.4
34.7
27.7
30.5
24.4
19.1
7.9
6.7
5.6
0.6
0.7
0.9
22.6
22.4
23.7
800
(2.3)
2.5
Hindustan Unilever
561
REDUCE
1,212,838
19,556
2,163
15.4
16.4
18.3
28.1
6.7
11.2
36.4
34.1
30.7
29.9
26.8
23.3
49.1
35.5
28.8
3.3
1.9
2.2
103.1
113.0
98.3
560
(0.2)
14.9
315
ADD
2,497,169
40,264
7,920
9.3
10.6
12.1
19.0
13.5
14.4
33.8
29.8
26.0
23.8
20.7
17.6
10.6
9.5
8.5
1.7
2.0
2.4
36.1
35.9
37.1
365
15.8
36.4
Jubilant Foodworks
1,322
SELL
87,262
1,407
66
19.9
22.5
30.6
21.7
13.0
35.9
66.3
58.7
43.1
36.0
29.6
22.1
20.3
15.8
12.3
0.3
0.5
36.1
30.3
32.3
925
(30.0)
6.1
Jyothy Laboratories
186
ADD
33,589
542
181
3.9
6.9
11.5
40.5
77.3
67.6
47.8
26.9
16.1
30.8
19.5
14.7
5.2
3.5
3.0
1.2
1.3
1.3
9.9
15.5
20.1
215
15.9
0.5
Marico
208
REDUCE
134,286
2,165
645
5.6
7.6
8.8
8.0
35.8
15.1
37.0
27.3
23.7
22.9
18.7
16.2
6.7
8.0
6.4
0.2
0.8
1.0
18.3
30.2
27.8
215
3.2
1.5
ITC
Nestle India
4,921
Page Industries
SELL
474,459
7,650
96
110.8
117.3
140.2
11.1
5.9
19.5
44.4
41.9
35.1
26.2
23.2
19.9
24.2
19.2
15.6
1.0
1.1
1.4
71.6
58.1
54.2
4,500
(8.6)
4.8
5,169
ADD
57,650
930
11
100.9
141.5
182.7
25.1
40.3
29.1
51.2
36.5
28.3
33.1
23.9
18.5
26.3
19.3
14.2
1.0
1.2
1.5
59.3
62.3
58.9
5,300
2.5
0.5
Speciality Restaurants
120
BUY
5,655
91
47
5.0
4.4
5.2
1.8
(11.6)
17.4
24.2
27.3
23.3
15.1
14.3
11.4
2.0
1.9
1.7
0.8
1.2
1.7
11.6
6.9
7.5
145
20.4
0.1
Tata Global Beverages
145
ADD
89,761
1,447
618
6.3
6.8
7.7
14.8
6.9
13.5
22.9
21.4
18.9
13.5
11.4
9.9
1.6
1.5
1.4
1.5
1.7
2.1
8.4
8.6
9.2
155
6.8
6.4
Titan Industries
220
REDUCE
195,180
3,147
888
8.2
8.8
10.0
20.9
7.2
14.4
26.9
25.1
21.9
18.2
17.7
14.4
9.9
7.9
6.4
1.0
1.2
1.4
42.3
35.0
32.2
260
18.3
United Breweries
802
SELL
212,119
3,420
264
6.5
6.7
11.9
36.2
2.6
77.5
122.8
119.7
67.4
46.8
41.7
28.2
14.0
14.5
12.3
0.1
0.1
0.2
11.8
11.6
19.3
650
(19.0)
6.5
2,529
BUY
367,505
5,926
145
9.1
31.9
65.4
(33.4)
251.7
104.9
278.8
79.3
38.7
34.1
31.4
20.2
7.7
4.6
4.2
0.1
0.2
0.2
2.8
7.3
11.3
2,700
6.8
43.1
31.4
United Spirits
Consumer products
Cautious
7.7
6,798,261
109,614
19.2
16.6
19.1
38.9
33.3
28.0
26.5
23.1
19.2
11.9
10.0
8.8
1.6
1.5
1.8
30.7
30.1
NCC
28
ADD
7,236
117
257
2.4
2.1
2.5
74.2
(14.3)
17.3
11.5
13.5
11.5
6.1
6.8
6.4
0.3
0.3
0.3
1.1
3.5
3.5
2.6
2.2
2.5
40
41.8
0.9
Sadbhav Engineering
81
BUY
13,827
223
171
4.9
5.4
9.2
(47.3)
9.4
71.0
16.4
15.0
8.8
13.1
7.2
5.4
1.6
1.2
1.1
0.7
0.7
0.7
8.6
7.9
12.0
160
98.4
0.2
Cautious
30,266
488
(62.7)
72.2
95.4
28.1
16.3
8.4
6.6
6.0
5.4
0.5
0.5
0.4
0.5
1.3
1.6
1.8
2.8
5.3
7.3
Constructions
Construction
Energy
Aban Offshore
346
RS
15,041
243
44
38.6
77.2
98.5
(43.5)
99.8
27.7
9.0
4.5
3.5
7.6
7.1
6.3
0.5
0.6
0.5
1.0
1.4
1.4
6.4
14.9
15.6
Bharat Petroleum
342
BUY
247,330
3,988
723
36.6
36.0
34.9
99.2
(1.5)
(3.2)
9.4
9.5
9.8
6.7
6.3
6.8
1.4
1.2
1.1
3.2
3.2
3.1
14.5
12.9
11.5
440
28.6
9.0
Cairn india
323
ADD
616,434
9,939
1,910
63.1
62.7
55.3
51.7
(0.7)
(11.8)
5.1
5.1
5.8
4.1
3.8
4.0
1.3
1.1
0.9
3.6
3.7
3.7
24.8
22.7
17.2
370
14.7
13.4
Castrol India
299
SELL
147,750
2,382
495
9.0
9.9
10.4
(4.4)
9.0
5.7
33.0
30.3
28.7
22.8
20.6
19.1
25.3
23.9
37.8
2.3
2.7
2.8
79.0
81.1
102.1
230
(23.0)
0.8
GAIL (India)
338
ADD
428,810
6,914
1,268
36.0
34.8
36.5
18.4
(3.5)
5.0
9.4
9.7
9.3
6.3
6.6
5.5
1.6
1.4
1.3
2.8
2.9
3.1
17.5
14.9
13.8
410
21.3
5.4
32.0
0.5
GSPL
57
ADD
31,962
515
563
9.6
8.7
7.6
2.6
(8.8)
5.9
6.5
7.5
3.7
3.9
4.1
1.0
0.8
0.8
1.8
1.8
2.7
17.6
13.7
10.6
75
Hindustan Petroleum
218
ADD
74,006
1,193
339
24.8
12.5
21.0
(7.6)
(49.6)
68.2
8.8
17.5
10.4
8.3
10.3
7.8
0.4
0.4
0.4
3.9
1.8
3.1
4.7
2.3
3.7
240
9.9
Indian Oil Corporation
199
ADD
483,769
7,800
2,428
16.8
11.8
26.6
(48.8)
(30.0)
125.8
11.8
16.9
7.5
9.4
7.5
4.6
0.8
0.7
0.7
3.1
3.8
6.8
6.2
4.0
8.8
250
25.5
2.0
Oil India
456
BUY
274,090
4,419
601
59.7
57.0
62.8
4.1
(4.6)
10.2
7.6
8.0
7.3
3.1
2.7
2.3
1.3
1.2
1.2
6.6
6.4
7.0
15.9
14.2
14.6
600
31.6
2.8
Oil & Natural Gas Corporation
280
BUY
2,395,546
38,625
8,556
29.4
32.1
36.6
(10.5)
9.2
14.0
9.5
8.7
7.7
3.8
3.3
2.7
1.3
1.2
1.0
3.4
3.6
4.1
13.3
13.2
13.6
340
21.4
15.0
Petronet LNG
122
BUY
91,200
1,470
750
15.3
10.4
12.0
8.7
(32.0)
15.3
7.9
11.7
10.1
5.8
7.4
6.2
1.9
1.6
1.4
2.1
2.1
2.3
25.6
14.4
14.5
165
35.7
2.4
Reliance Industries
865
BUY
2,538,759
40,935
2,936
65.0
69.4
77.9
6.2
6.7
12.3
13.3
12.5
11.1
8.7
8.5
7.0
1.3
1.2
1.1
1.0
1.0
1.2
11.3
11.1
11.3
980
13.3
41.9
Attractive
1.9
Energy
(13.1)
4.6
7,344,695
118,425
0.1
2.1
12.5
9.7
9.5
8.4
6.0
5.5
4.5
1.3
1.1
1.0
2.6
2.7
3.2
13.0
12.1
12.4
SELL
139,489
2,249
212
6.7
9.8
19.7
(23.6)
47.6
100.2
99.0
67.0
33.5
57.9
36.5
20.5
5.4
5.1
4.6
0.5
0.5
0.5
5.5
7.8
14.4
450
(31.6)
REDUCE
81,948
1,321
80
113.6
103.6
114.6
6.8
(8.8)
10.6
9.0
9.9
8.9
5.4
4.9
4.7
1.2
1.1
1.0
2.9
2.9
2.9
14.5
12.0
12.2
1,075
4.9
0.5
SELL
378,399
6,101
2,448
27.0
15.0
11.7
(6.0)
(44.5)
(21.8)
5.7
10.3
13.2
3.6
6.6
8.2
1.2
1.1
1.1
3.5
2.1
1.6
23.7
11.5
8.4
105
(32.1)
18.6
135
Industrials
ABB
Bharat Electronics
658
1,024
Bharat Heavy Electricals
155
Crompton Greaves
125
Cummins India
ADD
78,462
1,265
630
1.3
5.1
8.8
(77.2)
293.4
70.5
95.3
24.2
14.2
22.2
11.8
8.8
2.2
2.1
1.9
1.0
1.1
1.3
2.3
8.8
13.8
8.3
4.6
429
REDUCE
119,016
1,919
277
28.3
21.4
23.0
28.3
(24.5)
7.8
15.2
20.1
18.6
14.8
18.4
17.1
5.0
4.5
4.1
3.0
2.3
2.4
34.5
22.6
21.4
400
(6.8)
1.9
Kalpataru Power Transmission
87
BUY
13,320
215
153
8.8
11.9
16.0
(34.1)
36.1
33.8
9.9
7.3
5.4
6.4
5.7
5.1
0.7
0.6
0.6
1.7
1.7
1.7
6.8
8.4
10.4
120
38.2
0.3
KEC International
49
BUY
12,623
204
257
2.5
5.1
8.6
(63.1)
101.9
68.9
19.4
9.6
5.7
7.3
5.9
4.6
1.0
1.0
0.8
1.0
1.6
2.6
5.5
10.4
15.8
68
38.5
0.3
REDUCE
969,209
15,627
923
52.4
48.2
58.0
4.4
(8.1)
20.5
20.0
21.8
18.1
15.8
15.5
14.0
2.8
2.5
2.2
1.2
1.2
1.3
15.2
12.2
13.0
970
(7.6)
41.4
Siemens
620
SELL
218,310
3,520
352
4.9
17.6
22.3
(64.4)
260.6
27.0
127.1
35.3
27.8
41.8
16.7
13.7
5.6
5.2
4.8
0.4
0.9
0.9
4.4
15.4
18.0
400
(35.5)
3.9
Thermax
682
REDUCE
81,302
1,311
119
25.5
25.2
31.3
(22.5)
(1.3)
24.1
26.7
27.1
21.8
18.0
17.2
14.5
4.4
3.9
3.5
1.0
1.0
1.3
17.4
15.2
17.0
540
(20.9)
0.6
Voltas
114
BUY
37,534
605
331
5.9
6.0
8.3
(39.7)
1.2
39.2
19.2
19.0
13.7
13.9
12.8
8.2
2.3
2.1
1.9
1.7
1.6
2.2
12.5
11.6
14.8
110
(3.1)
4.8
2,129,613
34,338
(6.6)
(19.4)
9.8
15.0
18.6
16.9
11.6
13.1
12.3
2.4
2.1
1.9
1.6
1.4
1.4
15.8
11.5
11.5
Industrials
1,050
Cautious
12
India Daily Summary - December 1
Larsen & Toubro
Company
Consumer products

13
Company
Infrastructure
13-Dec-13
Price (Rs)
Rating
Mkt cap.
(Rs mn)
(US$ mn)
O/S
shares
(mn)
2013
EPS (Rs)
2014E 2015E
EPS growth (%)

2013
2014E
2015E
EV/EBITDA (X)
2013 2014E 2015E
RoE (%)
2014E
Target
price Upside
(Rs)
(%)
ADVT3mo
(US$ mn)
ADD
306,652
4,944
2,017
8.0
7.4
11.4
18.9
20.5
13.4
10.1
4.7
3.0
0.8
0.8
1.2
28.2
24.6
150
(1.3)
6.4
140,824
2,271
195
48.2
51.6
59.4
7.1
7.0
15.2
15.0
14.0
12.2
10.7
9.8
8.1
2.2
2.0
1.8
1.6
1.6
1.9
15.8
15.1
15.6
800
10.8
0.8
RS
84,465
1,362
3,892
(1.8)
(3.7)
(2.6)
(56.2)
(108.7)
30.1
(12.3)
(5.9)
(8.4)
18.2
14.5
7.9
0.9
1.2
1.3
(9.3)
(21.9)
(18.8)
3.0
4.2
29.7
138.9
16.3
41.4
17.3
14.9
16.9
12.5
11.0
2.5
2.2
1.9
7.6
16.2
14.6
62
(2.2)
0.8
14.7
11.1
(7.2)
(5.3)
5.5
5.9
6.2
6.3
6.9
6.6
0.9
0.7
0.7
4.4
4.4
4.4
17.4
13.3
10.8
100
9.2
4.4
19.5
(29.9)
23.7
33.8
18.9
14.5
12.2
8.5
2.2
2.1
1.9
1.0
1.0
1.3
9.5
6.2
10.2
BUY
30,650
494
483
1.5
3.7
30,428
491
332
16.7
15.5
593,020
9,562
Infrastructure
Cautious
78.7
20.1
2015E
ADD
ADD
3.7
2013
22
92
14.1
Dividend yield (%)

2013 2014E 2015E
152
63
17.8
Price/BV (X)
2013
2014E 2015E
722
Gujarat Pipavav Port
53.2
2015E
Adani Port and SEZ
IRB Infrastructure
(7.8)
PER (X)
2014E
Container Corporation
GMR Infrastructure
47.3
2013
Media
DB Corp
DishTV
Eros International
275
ADD
50,463
814
183
11.9
14.5
16.7
7.9
22.3
15.1
23.1
18.9
16.4
13.1
10.7
9.3
4.9
4.4
4.0
2.0
2.5
3.3
22.3
24.5
25.5
300
9.0
0.3
61
ADD
64,740
1,044
1,065
(1.2)
(0.4)
0.7
(22.3)
64.2
259.9
(49.0)
(136.8)
85.6
12.9
11.7
10.2
(41.7)
(32.0)
(51)
106.0
26.4
(46)
60
(1.3)
4.2
17.2
19.5
237
92
23.2
4.6
13.0
19.1
9.3
8.2
6.9
5.5
4.5
1.5
1.2
1.0
17.2
16.4
16.5
180
12.5
0.7
83
ADD
26,154
422
316
5.1
5.5
6.7
(10.4)
8.1
22.5
16.4
15.1
12.4
9.6
8.1
6.8
2.8
2.6
2.4
2.5
3.7
4.4
19.0
18.0
20.5
120
45.1
0.3
Sun TV Network
364
REDUCE
143,544
2,314
394
18.0
19.1
22.5
2.4
6.0
18.0
20.2
19.1
16.2
12.8
11.6
9.9
4.9
4.6
4.3
2.6
3.3
4.1
26.5
25.8
28.4
430
18.1
5.7
Zee Entertainment Enterprises
280
REDUCE
266,000
4,289
950
7.6
9.2
10.8
25.6
20.9
17.5
37.0
30.6
26.0
26.2
20.9
17.4
5.4
5.0
4.8
0.6
0.8
0.9
15.3
17.3
19.1
240
(14.3)
10.1
Neutral
591,714
9,541
8.3
19.6
24.0
28.4
23.8
19.2
14.6
12.4
10.5
4.6
4.3
4.0
1.3
1.7
2.2
16.2
17.9
20.6
1,788,163
27.2
13.2
Jagran Prakashan
160
Media
ADD
14,674
6.1
Metals & Mining

Coal India
283
BUY
28,832
6,316
27.5
27.1
30.5
18.1
(1.3)
12.5
10.3
10.4
9.3
5.9
5.2
4.1
3.5
3.1
2.7
4.9
4.9
5.5
31.1
360
Hindalco Industries
119
REDUCE
245,066
3,951
2,065
15.8
12.7
13.3
(10.9)
(19.4)
4.3
7.5
9.3
8.9
9.2
9.0
7.4
0.7
0.6
0.6
1.1
1.2
1.2
9.0
7.1
6.8
110
(7.3)
Hindustan Zinc
128
ADD
539,533
8,699
4,225
16.4
15.8
16.7
24.2
(3.5)
5.6
7.8
8.1
7.6
5.0
4.1
3.3
1.7
1.4
1.3
2.4
2.4
2.4
23.5
19.2
17.6
160
25.3
2.5
Jindal Steel and Power
260
REDUCE
242,861
3,916
935
31.1
20.5
22.2
(26.6)
(34.3)
8.5
8.3
12.7
11.7
7.4
9.4
7.0
1.1
1.1
1.0
0.7
0.7
0.7
14.9
8.7
8.7
240
(7.6)
11.0
242
32.9
94.0
4.2
10.5
11.1
710
(23.0)
14.1
JSW Steel
National Aluminium Co.
16.8
922
SELL
106.1
(46.2)
185.9
12.9
28.0
9.8
8.7
6.8
6.1
5.6
1.0
1.0
0.9
1.0
1.0
1.0
38
REDUCE
97,033
1,565
2,577
2.3
2.5
2.9
(31.2)
7.6
18.5
16.4
15.2
12.8
5.4
6.1
5.2
0.8
0.8
0.8
3.3
3.3
3.3
5.0
5.3
6.1
35
(7.0)
ADD
547,723
8,831
3,965
16.4
15.1
15.6
(11.2)
(7.8)
2.9
8.4
9.1
8.9
4.5
4.9
5.0
2.0
1.8
1.7
5.1
5.8
5.8
24.4
20.9
19.9
155
12.2
6.6
ADD
568,920
9,173
2,965
25.8
22.5
21.9
(16.8)
(12.8)
(2.8)
7.4
8.5
8.8
4.6
4.4
4.4
0.8
0.8
0.7
3.3
0.1
(0.1)
210
9.4
28.4
403,281
6,502
971
3.4
40.6
40.9
(86.9)
1,087.7
0.6
121.4
10.2
10.2
8.1
6.7
6.4
1.2
1.1
1.0
1.9
1.9
1.9
0.9
11.0
10.2
395
(4.9)
40.5
4,655,335
75,062
2.6
6.7
10.0
9.7
9.1
6.1
5.8
5.2
1.5
1.4
1.3
3.2
3.2
3.5
15.4
14.4
14.1
Sesa Sterlite
192
Tata Steel
415
Metals & Mining
ADD
Neutral
3,592
31.5
138
NMDC
222,755
37.2
9.9
0.3
Pharmaceutical
REDUCE
114,618
1,848
139
21.9
26.7
31.2
38.5
22.0
16.7
37.7
30.9
26.4
19.8
17.0
14.3
4.1
3.8
3.4
0.7
0.8
1.0
11.6
12.9
13.7
850
381
ADD
75,349
1,215
198
15.5
19.7
24.2
(9.2)
27.0
22.9
24.5
19.3
15.7
13.7
10.9
9.3
2.8
2.6
2.3
2.0
2.0
2.0
20.5
13.9
15.6
350
(8.2)
3.1
Cipla
377
ADD
302,460
4,877
803
17.8
19.2
21.2
27.1
8.2
10.3
21.2
19.6
17.8
14.0
14.3
11.7
3.4
2.9
2.5
0.5
0.5
0.5
15.6
14.9
15.2
450
19.5
8.4
Cadila Healthcare
740
ADD
151,554
2,444
205
29.5
33.1
44.1
(7.5)
12.2
33.3
25.1
22.4
16.8
18.3
16.2
12.4
5.1
4.4
3.7
1.0
1.1
1.4
23.7
21.2
24.1
830
12.1
1.5
Divi's Laboratories
1,110
ADD
147,214
2,374
133
45.4
57.4
61.3
12.9
26.4
6.9
24.5
19.3
18.1
17.8
14.6
12.5
4.9
4.2
1.4
1.7
1.8
26.0
27.8
25.2
1,090
(1.8)
4.1
Dr Reddy's Laboratories
2,401
BUY
409,122
6,597
170
96.0
122.1
139.8
14.2
27.3
14.5
25.0
19.7
17.2
16.8
13.4
11.7
5.6
4.5
3.8
0.6
0.8
0.9
24.0
25.6
24.0
2,700
12.5
11.2
GlaxoSmithKline Pharmaceuticals
2,460
SELL
208,514
3,362
85
81.4
84.5
97.5
9.7
3.8
15.5
30.2
29.1
25.2
23.2
22.2
18.5
10.4
9.6
8.6
2.0
2.2
2.4
28.5
34.2
36.0
1,820
(26.0)
1.1
Glenmark Pharmaceuticals
523
ADD
141,630
2,284
271
22.7
27.0
33.0
3.7
19.0
22.3
23.0
19.4
15.8
16.6
12.5
10.7
5.1
4.5
3.6
0.4
0.4
0.4
23.8
24.8
25.5
570
9.0
5.4
Lupin
870
ADD
388,756
6,268
447
29.5
36.0
42.9
52.3
21.9
19.1
29.5
24.2
20.3
18.4
15.3
12.5
7.4
5.9
4.8
0.5
0.7
0.8
28.6
27.5
26.4
950
9.2
10.4
Ranbaxy Laboratories
424
217.7
(176.5)
202.8
19.4
(25.4)
26.5
(20.7)
21.4
300
(29.2)
26.5
Sun Pharmaceuticals
571
37.5
40.2
3.9
32.5
23.1
22.3
22.8
16.1
14.8
7.1
6.2
4.9
0.4
0.5
0.5
24.3
28.6
24.4
510
(10.7)
18.4
46.4
3.1
29.0
27.3
26.5
20.5
18.1
15.7
13.3
5.7
5.0
4.1
0.7
0.8
0.8
20.8
19.0
20.2
Apollo Hospitals
Pharmaceuticals
2,889
423
21.8
(16.7)
17.2
SELL
1,182,935
19,073
2,071
17.6
24.7
25.6
Attractive
REDUCE
3,301,340
179,188
53,230
24.7
10.5
26.8
16.3
5.9
4.4
6.5
4.4
3.2
1.9
Real Estate
DLF
151
ADD
268,562
4,330
1,780
4.3
4.2
9.7
(40.5)
(2.7)
132.6
35.1
36.1
15.5
19.0
13.7
10.8
1.0
0.9
0.9
1.3
0.7
0.7
2.7
2.6
5.7
235
55.7
23.8
HDIL
Oberoi Realty
48
211
NR
BUY
20,217
69,274
326
1,117
419
328
1.7
15.4
11.0
19.0
14.3
21.7
(91.0)
9.0
528.0
23.4
30.4
14.4
27.6
13.7
4.4
11.1
3.4
9.7
8.7
9.6
7.6
7.8
6.6
6.1
0.2
1.7
0.2
1.5
0.2
1.3
0.9
0.9
0.9
0.7
12.8
4.3
14.0
5.4
14.2
290
37.4
8.0
0.6
Prestige Estates Projects

Sobha Developers
Sunteck Realty
Real Estate
154
327
335
BUY
BUY
BUY
Cautious
53,935
32,091
20,071
476,991
870
517
324
7,691
350
98
60
8.2
22.1
0.7
13.1
23.2
57.7
17.1
36.5
24.7
224.5
5.4
29.0
(34.0)
60.9
4.7
8,502
70.8
30.1
57.5
(57.2)
44.9
18.9
14.8
499.1
24.9
11.7
14.1
5.8
14.6
9.0
9.0
13.6
10.1
12.6
8.2
456.2
14.7
8.0
8.2
4.4
9.8
6.6
6.1
9.6
7.8
2.0
1.5
4.1
1.0
1.7
1.4
2.4
0.9
1.5
1.2
2.1
0.8
2.1
1.1
1.5
0.6
0.7
1.5
0.6
0.7
11.7
10.5
0.7
3.9
15.6
10.2
52.7
6.1
17.4
14.6
16.6
8.2
200
500
470
29.8
52.8
40.4
0.7
0.9
0.1
824
Biocon
HCL Technologies
13-Dec-13
Price (Rs)
Rating
8.5
6.3
22.8
17.5
(1.0)
10.4
8.9
9.0
7.9
5.7
5.4
2.8
2.5
2.2
5.2
5.6
5.6
29.5
30.0
26.4
130
11.6
3.5
13.3
10.7
20.3
20.5
18.5
15.4
14.8
12.2
10.0
5.1
4.3
3.6
1.4
2.0
2.4
27.2
25.6
25.5
3,750
11.1
60.1
Mindtree
1,378
ADD
57,879
933
42
81.7
113.1
128.6
53.2
38.5
13.7
16.9
12.2
10.7
11.7
9.2
7.5
4.4
3.4
2.7
0.9
1.2
1.4
29.8
31.5
28.0
1,540
11.7
2.3
(6.1)
(56.8)
Technology
15.9
6.4
1,050
375
(11.1)
(1.9)
24.4
17.6
1.8
19.2
22.4
(3.8)
(3.9)
16.5
6.3
6.5
5.6
3.1
2.3
2.0
0.9
0.8
0.8
3.3
3.4
3.6
15.3
13.6
14.2
135
7.5
1.2
111.3
31.1
33.0
17.5
28.1
21.1
18.0
21.1
14.8
12.6
9.6
7.5
6.0
1.1
1.7
1.9
38.0
39.9
37.3
2,250
12.4
44.5
6,371
234
101.9
131.5
143.2
16.7
29.1
8.9
16.6
12.9
11.8
12.1
8.8
7.7
5.8
4.2
3.2
0.3
0.3
0.3
36.3
33.8
27.6
1,850
9.4
33.2
20,601
2,463
24.9
31.7
35.9
9.9
27.3
13.3
20.8
16.4
14.4
14.6
11.2
9.1
4.5
3.7
3.1
1.3
1.5
1.7
21.6
25.0
23.6
540
4.1
21.3
26.5
395,123
19.1
27.9
94.8
1,277,681
2.0
33.0
20.0
ADD
4.4
33.7
71.2
ADD
4.4
1.4
100
519
1.6
1.2
1,957
1,691
Wipro
1.6
1.0
202
Tech Mahindra
7.8
3.4
63,172
ADD
7.6
4.3
12,522
2,002
25.1
9.2
3,917,923
TCS
10.8
13.9
ADVT3mo
(US$ mn)
13.0
10.2
13.6
Target
price Upside
(Rs)
(%)
219.7
(3.7)
14.6
2015E
13.1
15.2
20.7
RoE (%)
2014E
182.5
35.3
7.0
2013
11.2
37.6
42.3
Dividend yield (%)

2013 2014E 2015E
164.9
211
64.7
Price/BV (X)
2013
2014E 2015E
293
1,299
86.6
EV/EBITDA (X)
2013 2014E 2015E
571
80,559
81.0
2015E
551
SELL
56.9
PER (X)
2014E
31,084
REDUCE
710
2013
34,176
382
13,522
EPS growth (%)

2013
2014E
2015E
1,927,818
126
838,617
EPS (Rs)
2014E 2015E
ADD
Mphasis
REDUCE
2013
3,374
Polaris Financial Technology
REDUCE
117
O/S
shares
(mn)
Infosys
Hexaware Technologies
1,181
Mkt cap.
(Rs mn)
(US$ mn)
0.5
Attractive
8,542,299
137,735
23.2
26.9
13.8
22.9
18.1
15.9
16.5
12.3
10.5
6.3
5.0
4.1
1.2
1.7
1.9
27.5
27.8
26.1
Bharti Airtel
321
ADD
1,282,588
20,680
3,997
6.0
10.1
17.0
(46.6)
68.7
67.7
53.5
31.7
18.9
8.0
6.7
5.6
2.5
2.4
2.2
0.3
0.3
1.1
4.5
7.8
12.0
400
24.7
Bharti Infratel
174
ADD
327,909
5,287
1,889
5.3
7.1
9.6
23.3
34.5
33.9
32.7
24.3
18.2
8.4
6.9
6.1
1.9
1.8
1.8
2.2
1.8
2.6
6.3
7.7
9.9
200
15.2
IDEA
171
BUY
565,360
9,116
3,303
3.1
6.5
9.5
39.8
111.2
46.4
55.9
26.5
18.1
11.7
8.0
6.4
4.0
3.5
3.0
0.2
0.3
0.4
7.4
14.0
17.7
195
13.9
15.4
Reliance Communications
130
Tata Communications
271
Telecom
Telecom
SELL
BUY
Attractive
4,325
2,064
3.3
6.5
7.2
77,235
1,245
285
(29.4)
(2.4)
9.8
2,521,309
268,217
40,653
98.9
11.1
(5.5)
91.8
505.1
(39.1)
(27.5)
145.8
53.4
39.9
20.0
0.9
0.9
0.4
4.6
4.9
85
(34.6)
22.2
(9.2)
(112.0)
27.6
9.0
6.1
5.4
5.4
13.3
8.9
(45.0)
(6.9)
38.6
285
5.2
2.9
28.7
18.7
8.9
7.1
6.1
2.3
2.1
2.0
0.5
0.5
1.0
3.2
7.4
10.4
20.3
10.3
(41.7)
(63.7)
(21.3)
70.6
18.0
9.9
8.4
7.8
0.9
Utilities
Adani Power
CESC
JSW Energy
Lanco Infratech
NHPC
NTPC
Power Grid
Reliance Infrastructure
38
SELL
109,420
2,872
(9.0)
(9.4)
(1.3)
86.6
(4.2)
(30.5)
46.2
2.9
(9.1)
30
420
ADD
52,511
847
125
34.3
42.9
44.4
57.6
25.1
3.5
12.3
9.8
9.5
11.7
9.7
8.1
0.8
0.7
0.7
1.7
1.7
1.8
6.7
7.7
7.5
403
(4.1)
1.5
53
ADD
87,166
1,405
1,764
1,640
6.7
8.2
7.9
(2,023.1)
232.1
22.7
(4.0)
(3.6)
7.9
(4.1)
6.5
6.7
6.7
4.8
4.3
1.4
2.5
1.2
2.6
1.0
18.5
19.6
15.9
50
(5.9)
1.3
3.8
RS
15,005
242
2,223
(4.7)
(6.0)
4.5
(790.4)
(28.6)
174.6
(1.4)
(1.1)
1.5
14.8
13.5
5.9
0.4
0.6
0.4
(24.2)
(41.9)
33.3
0.6
18
ADD
222,643
3,590
12,301
1.9
1.9
2.1
(22.2)
(0.6)
11.7
9.3
9.4
8.4
8.8
9.4
7.1
0.7
0.7
0.7
3.3
2.9
3.2
8.1
7.6
8.0
23
27.1
1.7
137
98
420
ADD
BUY
BUY
1,132,102
451,399
110,499
18,254
7,278
1,782
8,245
4,630
263
12.5
9.1
70.9
13.1
10.1
56.7
13.7
11.1
63.7
15.3
28.7
17.5
5.3
11.6
(20.0)
4.7
9.8
12.4
11.0
10.7
5.9
10.5
9.6
7.4
10.0
8.8
6.6
9.0
10.7
9.6
9.1
9.8
8.3
8.3
8.5
7.3
1.4
1.7
0.4
1.3
1.5
0.4
1.2
1.4
0.4
4.7
2.8
1.8
2.9
3.2
2.7
3.0
3.5
2.7
13.4
16.9
11.0
12.9
16.9
8.8
12.4
16.7
9.2
160
135
670
16.5
38.5
59.5
11.3
8.6
19.3
28.8
22.0
Reliance Power
71
Tata Power
87
Utilities
SELL
ADD
Attractive
3,216
2,805
3.6
3.9
3.8
16.7
8.0
5.2
69
(3.0)
10.5
215,240
3,470
2,468
4.0
5.4
5.8
(12.9)
33.4
8.2
21.7
16.3
15.1
9.4
7.1
6.7
1.6
1.5
1.4
1.3
1.4
1.4
7.4
9.6
9.6
87
(0.2)
4.8
2,595,429
199,444
41,848
(0.8)
3.0
31.2
(2.9)
13.6
19.7
13.2
18.3
10.1
18.8
11.0
24.9
10.0
8.3
1.2
1.1
1.1
1.0
1.0
1.0
3.1
2.3
2.5
8.8
5.6
8.5
5.7
10.3
Others
BUY
26,245
423
187
12.2
(58.7)
8.4
2.2
160
14.2
0.1
Coromandel International
237
SELL
67,056
1,081
283
15.3
15.4
18.4
(32.5)
0.7
20.0
15.5
15.4
12.8
13.6
9.6
8.6
3.1
2.7
2.3
1.9
2.0
2.0
17.8
17.6
18.6
170
(28.2)
0.5
Havells India
Carborundum Universal
732
REDUCE
91,316
1,472
125
33.2
37.8
42.5
5.5
13.8
12.7
22.1
19.4
17.2
14.3
12.0
10.8
6.1
4.9
4.0
1.0
1.1
1.2
33.1
28.2
25.9
700
(4.4)
3.3
Info Edge
273
BUY
29,833
481
109
10.6
11.6
14.2
10.6
9.4
22.6
25.9
23.7
19.3
20.0
16.6
12.2
4.8
4.3
3.8
0.4
1.5
1.8
20.2
19.3
21.1
530
94.0
0.7
51
ADD
113,396
1,828
2,219
2.0
3.3
9.0
(32.9)
66.0
176.7
26.1
15.7
5.7
11.4
9.7
6.5
0.9
0.9
0.8
3.6
5.6
14.4
52
1.8
25.7
1,318
48.7
115.3
52.6
16.7
13.9
30.1
Jaiprakash Associates
Just Dial
140
1,168
4.8
7.3
67.4
29.2
19.2
75.0
11.5
50.4
12.5
76.0
12.8
2.0
1.7
0.6
ADD
81,764
70
10.1
15.6
20.8
53.8
34.1
19.2
1,250
7.0
15.3
20,219
326
51
58.6
30.2
32.9
(1.5)
(48)
9.0
6.8
13.2
12.1
1.8
4.6
3.7
1.8
1.7
1.6
6.1
4.0
4.0
27.7
13.0
13.4
500
25.5
6.1
BUY
32,875
530
194
6.1
8.2
10.8
20.0
34
31.9
27.6
20.6
15.6
16.0
12.1
9.6
5.3
4.5
3.7
1.4
1.3
1.3
18.9
23.2
26.1
180
6.5
0.7
Tata Chemicals
268
BUY
68,164
1,099
255
15.7
22.6
32.2
(52.2)
44.0
42.3
17.0
11.8
8.3
5.9
5.3
4.7
1.0
0.9
0.8
3.7
3.7
3.7
5.0
7.2
9.7
300
12.1
1.6
UPL
173
REDUCE
76,615
1,235
443
17.5
19.8
20.8
39.4
13.2
5.0
9.9
8.7
8.3
5.6
5.2
4.7
1.6
1.4
1.2
1.4
1.4
1.4
18.0
17.8
16.2
145
(16.2)
4.8
(20.6)
577,651
9,314
21.0
53.3
18.5
15.3
10.0
10.4
KIE universe
54,071,825
871,845
7.3
6.8
17.3
15.4
14.4
12.3
10.0
8.9
7.5
2.3
2.1
1.9
1.8
1.8
2.1
15.0
14.5
15.2
KIE universe ex-energy
46,727,130
753,420
9.5
8.0
18.6
17.0
15.7
13.2
11.5
10.0
8.5
2.7
2.4
2.1
1.7
1.7
1.9
15.7
15.2
16.1
KIE universe ex-energy & ex-commodities
40,686,397
656,021
9.2
10.2
21.0
18.5
16.8
13.9
13.4
11.3
9.5
2.9
2.6
2.3
1.5
1.5
1.8
15.7
15.6
16.7
(a) For banks we have used adjusted book values.

(b) 2012 means calendar year 2011, similarly for 2013 and 2014 for these particular companies.
(c) EV/Sales & EV/EBITDA for KS universe excludes Banking Sector.
62.02
(d) Rupee-US Dollar exchange rate (Rs/US$)=
14
India Daily Summary - December 1
Notes:
1.4
1.4
1.4
1.5
9.6
23.8
17.1
REDUCE
1.6
26.1
11.6
398
1.8
0.7
8.2
169
6.8
0.5
1.5
MCX India
9.0
0.9
Rallis India
Others
23.2
52.2
10.7
14.4
Company
Technology
Disclosures
"Each of the analysts named below hereby certifies that, with respect to each subject company and its securities for which the analyst is
responsible in this report, (1) all of the views expressed in this report accurately reflect his or her personal views about the subject companies
and securities, and (2) no part of his or her compensation was, is, or will be, directly or indirectly, related to the specific recommendations or
views expressed in this report: Rohit Chordia, Nischint Chawathe."
Kotak Institutional Equities Research coverage universe

Distribution of ratings/investment banking relationships
Percentage of companies covered by Kotak Institutional
Equities, within the specified category.
70%
60%
Percentage of companies within each category for which

Kotak Institutional Equities and or its affiliates has provided
investment banking services within the previous 12 months.
50%
40%
32.7%
34.5%
30%
18.8%
20%
10%
13.9%
6.1%
5.5%
0.6%
1.8%
REDUCE
SELL
0%
BUY
ADD
* The above categories are defined as follows: Buy = We

expect this stock to deliver more than 15% returns over the
next 12 months; Add = We expect this stock to deliver
5-15% returns over the next 12 months; Reduce = We
expect this stock to deliver -5-+5% returns over the next
12 months; Sell = We expect this stock to deliver less than 5% returns over the next 12 months. Our target prices are
also on a 12-month horizon basis. These ratings are used
illustratively to comply with applicable regulations. As of
30/09/2013 Kotak Institutional Equities Investment Research
had investment ratings on 165 equity securities.
Source: Kotak Institutional Equities
As of September 30, 2013
Ratings and other definitions/identifiers

Definitions of ratings
BUY. We expect this stock to deliver more than 15% returns over the next 12 months.
ADD. We expect this stock to deliver 5-15% returns over the next 12 months.
REDUCE. We expect this stock to deliver -5-+5% returns over the next 12 months.
SELL. We expect this stock to deliver <-5% returns over the next 12 months.
Our target prices are also on a 12-month horizon basis.
Other definitions
Coverage view. The coverage view represents each analysts overall fundamental outlook on the Sector. The coverage view will consist of one of the following
designations: Attractive, Neutral, Cautious.
Other ratings/identifiers
NR = Not Rated. The investment rating and target price, if any, have been suspended temporarily. Such suspension is in compliance with applicable
regulation(s) and/or Kotak Securities policies in circumstances when Kotak Securities or its affiliates is acting in an advisory capacity in a merger or strategic
transaction involving this company and in certain other circumstances.
CS = Coverage Suspended. Kotak Securities has suspended coverage of this company.
NC = Not Covered. Kotak Securities does not cover this company.
RS = Rating Suspended. Kotak Securities Research has suspended the investment rating and price target, if any, for this stock, because there is not a sufficient
fundamental basis for determining an investment rating or target. The previous investment rating and price target, if any, are no longer in effect for this stock
and should not be relied upon.
NA = Not Available or Not Applicable. The information is not available for display or is not applicable.
NM = Not Meaningful. The information is not meaningful and is therefore excluded.
16
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INDIA DAILY

December 16, 2013

13-Dec 1-day1-mo 3-mo

(0.1) (3.8) (2.8)

Shriram Transport: Management meeting takeaways - cautious outlook

` Collections efficiency picks up, remains the key monitorable

0.0 (2.1) (2.5)

Value traded India

Deri. open interest

` Key highlights of the NIA for January 2014 spectrum auctions

Net investment (US$mn)

Kotak Institutional Equities Research

Shriram Transport (SHTF)

DECEMBER 16, 2013

Management meeting takeawayscautious outlook. At our recent meeting,

Price (`): 596

Collections efficiency picks up, remains the key monitorable

M.B. Mahesh, CFA

Kotak Institutional Equities Research

Yields on loans on balance sheet

Source: Company, Kotak Institutional Equities estimates

KOTAK INSTITUTIONAL EQUITIES RESEARCH

Capital infusion in equipment-finance business on the cards

SEF 2015E book value pre-dilution (Rs mn)

Source: Company, Kotak Institutional Equities estimates

KOTAK INSTITUTIONAL EQUITIES RESEARCH

Exhibit 3: Shriram Equipment Finance quarterly data

Source: Company, Kotak Institutional Equities

KOTAK INSTITUTIONAL EQUITIES RESEARCH

Exhibit 4: STFC trades at 1.5X PBR

Rolling PER (X) (LHS)

Rolling PBR (X) (RHS)

Source: Company, Bloomberg, Kotak Institutional Equities estimates

Exhibit 5: Shriram Transport Finance - key ratios

Growth in key parameters (%)

Source: Company, Kotak Institutional Equities estimates

KOTAK INSTITUTIONAL EQUITIES RESEARCH

Exhibit 6: Shriram Transport Finance - income statement and balance sheet

Source: Company, Kotak Institutional Equities estimates

KOTAK INSTITUTIONAL EQUITIES RESEARCH

Key highlights of the NIA for January 2014 spectrum auctions

Kotak Institutional Equities Research

Reserve price (Rs mn)

EMD per block

KOTAK INSTITUTIONAL EQUITIES RESEARCH

Exhibit 2: Details of the 900 MHz auction

EMD per block

Source: DoT, Kotak Institutional Equities

Exhibit 3: Timeline of auction-related events

December 20, 2013

December 24, 2013

Last date for seeking clarifications on NIA

December 28, 2013

Last date for submission of applications

Publication of ownership details of applicants

January 10, 2014

Bidder Ownership Compliance Certificate

January 14, 2014

January 16, 2014

Final list of bidders

January 21-22, 2014

January 23, 2014