AUGUST 2, 2017 - Kotak Securities · Chhattisgarh and Madhya Pradesh despite close contests in...

AUGUST 2, 2017

Kotak Securities – Private Client Research Please see the Disclosure/Disclaimer on the last page For Private Circulation 2

Monthly Market Strategy December 2018

MONTHLY OUTLOOK FOR DECEMBER 2018

Global markets bounced back strongly in November on lower crude prices and reduction in bond yields. Indian markets posted one of the best monthly returns after a long time as sharp correction in crude prices abetted macroeconomic worries. FIIs turned buyers after three consecutive months of selling. Despite the rebound in the market small and mid-cap indices, continue to underperform the broader indices.

On the global economy front, we need to watch out for Fed action and pace of future rate hikes. Few other key events to watch are the G20 meet, trade talks between US and China, OPEC meeting and news flows on Brexit. So far as the Indian economy is concerned, Inflation has remained benign and there could be respite on the CAD (due to fall in crude prices). Data on credit growth and rising Capital goods order books suggests that the economic recovery is now gaining a foothold.

From an Indian equity standpoint, the key event to watch out would be the Madhya Pradesh/Rajasthan/Chhattisgarh assembly elections. We believe these elections are important, as they will be seen as an indication of people's mood towards the ruling party and could also be a precursor to the upcoming general election scheduled somewhere in Apr-May’19. However, the impact of state elections could fade away after few weeks of election result as market participants will again focus on international developments and fundamentals.

Based on Bloomberg consensus estimates, the one year Fw PE of Mid Cap Index has now come down to 15x as compared to 16x of Nifty. There is still a sizeable gap between the Equity PE and bond PE (refer chart 7) which could cap any big re-rating in equities (unless the 10 Yr G-Sec bond yields go to or below the 7% mark). With macros turning positive and after a 18% from fall from the peak , the overvaluation in mid cap Index has faded away. The risk-reward ratio has turned favourable for many mid and small cap stocks. Many of the mid & small cap stocks have gone closer to their historic low valuations. This provides enough comfort for bottom fishing at this level in the mid and small cap space. Any near term correction in the market due to political uncertainty should be viewed as a buying opportunity (provided crude & currency remain closer to the current levels).

Investors need to have bottoms up approach and pick & choose good quality, beaten down stocks from respective sectors. To weather the on-going volatility which may remain till middle of next year (i.e. till Central elections), it is ideal to have higher allocation into high earnings growth large caps and mid-caps (with strong management pedigree, and reasonable valuations). One can re-access the situation and re-shuffle their holdings post-election outcome. The next few months could be very volatile filled with uncertainty, which will also offer good buying opportunity for Long term investors. Conservative investors may spread their buying across the next few months to average out any rise or fall in the market.

Sanjeev Zarbade [email protected]

+91 22 6218 6424



Chart 1 Market performance – sector wise (November 2018)

Source: Bloomberg

GLOBAL FACTORS US-China trade standoff As the G-20 finance leaders meet to discuss global policies in the Argentine capital of Buenos Aires on Nov. 30 and Dec. 1, one of the most pressing challenges will be the trade tariff dispute between the US and China. The outcome of meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping is likely to decide the future course of Sino-U.S. relations and global trade. One needs to watch whether US goes ahead with the increase in tariffs - from 10% to 25% on USD 200 bn of Chinese imports (as scheduled to take effect from 1st Jan’19). Any negative outcome between the two sides could be harmful for global trade and emerging market currencies.

Treasury bond yields have eased In its last meeting, the U.S. central bank left rates unchanged as expected, but maintained its plans to hike interest rates, saying it saw "further gradual increases" ahead. The bank did, however, note that business investment had "moderated from its rapid pace earlier in the year." As a result, bond yields eased off from their recent highs of 3.23%. Bonds also sold off following the U.S. midterm elections, which resulted in the Democrats winning the House of Representatives and the Republicans retaining the Senate. A split congress could stall plans for further tax cuts, which led to pressure on bond yields.

Chart 2 US 10 year treasury yield

Source: Bloomberg

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Brexit deal In an important milestone for Britain, EU leaders have approved an agreement on the UK's withdrawal and future relations - insisting it is the "best and only deal possible". Now, the withdrawal agreement is lined up to be approved by the U.K. Parliament on 12th December 2018. In case the deal is voted down by the U.K, the government could try to extend the deadline of March 29 (when the U.K. is officially due to leave the European Union) or the country crashes out of the EU without a deal.

Leaving the EU in March of next year without a deal would mean that World Trade Organization rules would apply. This would inevitably raise tariffs and costs for both producers and consumers. At the moment, the U.K. is a member of the EU single market of goods, meaning that trade is frictionless and with zero tariffs. There would be immense disruption and uncertainty, including in the energy market, the supply of medicines and medical devices, as well as in the car industry. A no deal exit could lead to a swift drop in the Pound, similar to that aftermath of the Brexit referendum in 2016.

Economic momentum in China The Chinese economy is slowing down with most growth indicators barely in the expansion zone. Bloomberg Economics projects the Chinese GDP to be up by 6.4% in year. This will be the lowest growth figure since 1990. China has already embarked on fiscal and monetary measures (reduction of reserve requirements for large banks to 14.5% from 17%, VAT rate reduced to 16% from 17% for manufacturing and Personal income tax-free threshold raised to 5,000 yuan per month from 3,500 yuan etc) to support the economy but the Chinese government’s efforts to support growth may be inadequate if ongoing China-US trade issues were to escalate into a full-blown trade war, which could result in further disruption in the Chinese economy. Other EMs could see collateral damage in the process although India would be relatively less affected given its low export dependence.

Chart 3 State of Chinese economy

Source: KIE, Bloomberg

Crude Oil price decline brings some relief The recent decline in global crude oil prices reflects (1) higher oil production by several OPEC countries over the past few months and (2) temporary 180-day exemption granted by the US to eight countries to continue to import oil from Iran. However, the decline may be temporary as the US administration has unambiguously stated its intention to bring down Iran oil exports to zero eventually. Also, OPEC leaders will gather in Vienna on Dec. 6 to discuss how to manage the oil output, supply glut and demand slowdown.

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Even so, the lower oil prices will result in stable macroeconomic conditions and from an election standpoint, (1) keep domestic retail auto fuel prices under check; steep increases in retail auto fuel prices before elections could spiral into an election issue and (2) provide the current government more fiscal freedom to spend before elections.

Chart 4 Crude chart

Source: Bloomberg

September ending quarter earnings Season Adjusted net profits of the BSE-30 Index and Nifty-50 Index increased 10% yoy in the September ending quarter. However, excluding banking stocks, net income of the BSE-30 Index and Nifty-50 Index grew 12% and 11%, respectively. A few banks reported significantly lower profits on yoy basis due to (1) high loan-loss provisions arising from the February 12, 2018 directive of the RBI on stress recognition and resolution and (2) lower other income (high capital gains in base quarter). However, almost all the banks reported a significant improvement in profits on a qoq basis on the back of lower loan-loss provisions.

Chart 5 BSE-30 Earnings growth

Source: Kotak Institutional Equities

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State elections – harbinger to general elections In October, Election Commission of India (EC) announced polling schedule for Assembly elections in five states - Chhattisgarh, Madhya Pradesh, Mizoram, Rajasthan and Telangana. Chhattisgarh will vote in two phases, other states will vote in a single phase. Counting of votes in all the five states will be done on December 11. Past results in upcoming elections in 3 states – Rajasthan has witnessed alternate government formations, while MP and Chhattisgarh have been ruled by BJP for the past 15 years. We believe these elections are important, as they will be seen as an indication of people's mood towards the ruling party and could also be a precursor to the upcoming general election scheduled somewhere in Apr-May’19.

Election Schedule

No of Incumbent State Assembly seats Government Election date Counting

Rajasthan 200 BJP 7th Dec 11th December Madhya Pradesh 230 BJP 28th Nov 11th December Chhattisgarh 90 BJP 12th and 20th November 11th December Telangana 119 TRS 7th Dec 11th December Mizoram 40 Congress 28th Nov 11th December

Source: Media reports and Kotak Institutional Equities

As of now, opinion polls indicate that the BJP will lose in Rajasthan but retain power in Chhattisgarh and Madhya Pradesh despite close contests in those states. The market expects a similar outcome. Thus, a 0-3 (BJP losing all the three states) or 1-2 (BJP losing Madhya Pradesh and Rajasthan) tally for the BJP may result in a correction in the market. In this scenario, market may take a dim view of the BJP’s prospects in the general elections given the importance of the three states in the BJP’s 2014 win. However, a 3-0 or 2-1 (any combination) score for the BJP may fortify the market’s expectations about the current BJP-led government forming the next government post the April/May general elections

Table – Opinion Poll Results

CVoter India TV-CNX Times

Chhattisgarh BJP 40 50 47 INC 47 30 33 Others 10 10 Madhya Pradesh BJP 108 128 122 INC 122 85 95 Others 17 13 Rajasthan BJP 56 75 70-80 INC 142 115 110-120 Others 8 7-10

Source: Media reports and Kotak Institutional Equities



Declining crude price to mitigate macro risks With 30% decline in crude prices, the rising macro risks to the Indian economy have begun to abate. The benefit is on several fronts. We look at some of them:

Indian Rupee - With the crash in crude, India's CAD will not aggravate further as the market feared earlier. Hence, the INR has appreciated by a good margin to below 70 from 74.40 levels. Since the US 10 Year treasury bond yield has corrected to 3.06% from high of 3.23%, it has resulted in reduction in foreign fund outflows from Indian debt market. Taking note of the reduction in macro risks and easing of market valuations, FIIs stopped selling and have turned buyers in November.

Inflation - CPI inflation eased to 3.31% in October from a downward revised print of 3.7% in September. This was primarily led by contraction of 0.9% in food inflation amid sharp drop in prices of vegetables and pulses. Food inflation is likely to remain benign, especially as most kharif crop prices remain well below the MSP prices. This coupled with reversal in crude prices in November, Inflation is likely to remain under control in the coming months, we believe.

Interest rates - Given the strong focus of the Monetary Policy Committee on the headline inflation print, which should remain benign for the rest of 2HFY19 (we expect it in the range of 2.8-4.3%), the RBI is unlikely to (1) change the repo rate, (2) keep CRR unchanged and (3) maintain the policy stance at ‘calibrated tightening’

Signs of economic recovery gaining strength We are seeing early signs of uptick in economic growth. Some of the key parameters like credit growth, capacity utilisation and order intake for capital goods companies have started to show traction. Job outlook has started to improve as reflected by some momentum in IT sector hiring.

Credit growth - On a year-on-year (y-o-y) basis, non-food bank credit increased by 11.3 per cent in September 2018 as compared with an increase of 6.1 per cent in September 2017.

Table - Macro snapshot

Dec-07 May-13 Oct-13

Capacity Utilisation (Mar-18) 91.7 71.6 74.9 Credit Growth (as on 30 Sept 2018) 22 14.4 11.3 ROE Nifty 50 (Oct 18) 25.5 17.1 13 IIP - Aug 18 13.5 1 4.5 GDP Growth (Apr - Jun 18) 9.6 6.4 8 10-Yrear Govt Bond Yield 7.8 7.2 7.8

Source: RBI



Investment Cycle - Demand for heavy equipment by Indian companies, an indirect measure of economic growth, is showing signs of rebound driven by government spending on railways, roads and smart cities ahead of the next general election. Siemens India Ltd., ABB India Ltd., Thermax Ltd. and Cummins Ltd. beat quarterly sales and operating income estimates. While mega/big ticket projects are yet to start, several consumer oriented industries have begun investing in capacity expansion/capacity optimisation projects, which is leading to better order book number for companies.

Table - Growth in Quarterly Order intake for key Capital Goods makers (in Q2FY19)

Company YoY (%)

L&T 46 Thermax -3 Siemens 37 ABB 21 Praj 38

Source: BSEIndia.com

Fund flows – FIIs turn positive. MF flows remain resilient Overseas funds have turned net buyers in November so far. Two main factors that have led to FIIs reversal include INR appreciation against the USD and steep fall in crude price. YTD in this calendar year FIIs have sold stocks worth USD 5.5 bn whereas domestic Mutual Funds have bought stocks worth USD 16.3 bn. Other emerging markets like South Korea, Taiwan, Indonesia & Thailand have seen YTD outflows ranging between USD 4bn to USD 10 bn. However, on a monthly basis, FII flows have turned positive at USD 720 mn in Nov’18. In fact, this will be one of the few months when FII flow has been higher than MF flows (USD 353 mn).

Valuations have turned favorable for overall market India’s overall market valuations have become reasonable as compared to its 10 year average but is still slightly expensive when compared to the Bond PE. Current valuations factor in a strong recovery in earnings over FY2019-20E. At 16x FY2020E ‘EPS’ the Nifty 50 trades slightly below its 10 year average Fw PE valuations. Earnings growth of ~14-15% in FY19E will be highest in the last 4 years. Going forward our house is building in earnings growth of ~25% in FY20E mainly led by high earnings growth in the banking sector. Any disappointment in earnings of banking sector in FY20 could lead to sharp correction in the FY20E of Nifty EPS.

Based on Bloomberg consensus estimates, the one year Fw PE of Mid Cap Index has now come down to 15x as compared to 16x of Nifty. The above average gap between the Equity PE and bond PE could cap any big re-rating in equities (unless the 10 Yr G-Sec bond yields go to or below the 7% mark). With macros turning positive and after a 18% from fall from the peak , the overvaluation in mid cap Index has faded away. The risk-reward ratio has turned favourable for many mid and small cap stocks. Many of the mid & small cap stocks have gone closer to their historic low valuations. This provides enough comfort for bottom fishing at this level in the mid and small cap space. Any near term correction in the market due to political uncertainty should be viewed as a buying opportunity (provided crude & currency remain closer to the current levels).



Table – Valuation Comparison

BSE Sensex BSE Mid cap

P/BV (x) as on 16-Jan-18 10 Y Avg Price to Book Ratio 2.4 1.75 Current Price to Book Ratio 2.7 2.4 Price to Book Ratio Premium 13% 37% P/BV (x) as on 29-Nov-18 10 Y Avg Price to Book Ratio 2.4 1.75 Current Price to Book Ratio 2.55 2.16 Price to Book Ratio Premium 6% 23%

Source: Bloomberg

Chart 6 - One Yr Fw PE chart: Nifty Vs Mid Cap Index

Source: Bloomberg

Chart 7 - Bond PE Vs Fw Equity PE of Nifty

Source: Bloomberg

Economic Calendar for December

Date Event Remark

30-Nov G20 meet Trade talks between China and US 4-Dec Monetary Policy meet Rate hike unlikely given that inflation remains benign 30-Nov Q2 FY19 India GDP data Important to gauge the strength of economic growth 6-Dec OPEC meet Supply cut likely in crude output 11-Dec State Election Results Election results in MP 16-Dec Fed rate Fed may hike rate but more important is the glide path from thereon

Source: CNBC, RBI and MOSPI

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Apollo Tyres Ltd

CMP (Rs) 52 Week H/L (Rs) Mkt Cap (Rs mn) 239 307 / 192 136749

Financials (Rs mn)* FY18 FY19E FY20ESales 148,405 182,260 208,771 Growth (%) 12.6 22.8 14.5 EBITDA 16,513 21,872 27,612 EBITDA margin (%) 11.1 12.0 13.2 PBT 10,123 13,099 17,414 Adjusted Net profit 7,239 9,574 12,712 Adjusted EPS (Rs) 13.4 16.7 22.2 Growth (%) (38.0) 24.6 32.9 P/E (x) 17.8 14.3 10.8 BV (Rs/share) 180.9 183.5 202.2 Net debt/equity (x) 0.3 0.4 0.5 Source: BloombergROE (%) 8.5 9.4 11.5 ROCE (%) 6.4 7.4 8.6 Free cash flow (14,798) (11,011) (7,057) Source: Kotak Insitutional Equities; *Consolidated

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgRevenues 47,892 61,689 28.8 EBITDA 4,776 7,858 64.5 EBITDA Margin (%) 10.0% 12.7%Adjusted PAT 1,947 3,917 101.2 Adjusted PAT Margin (%) 4.1% 6.3%Adjusted EPS (Rs) 3.8 6.4 66.2 Source: Kotak Insitutional Equities; *Consolidated Source: Bloomberg

This one pager on the company is extracted from last KIE update dated November 13, 2018 and it does not contain events beyond that date. We take no obligation to updatethe KIE recommendations. Above company recommendation is of KIE which has a different rating system than Kotak PCG as disclosed in the end of the report (beforeDisclaimer). While source of all other information is taken from Kotak Institutional Equities, the price performance and shareholding pattern chart is inputted by Kotak PCGresearch team (with source as Bloomberg). It is advisable to read the full KIE report before taking any investment decision on the above company recommendation.

Share Holding Pattern (%)

Analyst: Nishit Jalan / Hitesh Goel

Price Performance (3 Years)

Target Price (Rs)315 31.8%

Potential Upside (%)

Promoter41.3%

FII21.4%

DII22.2%

Others15.0%

Key Highlights:

Domestic revenues increased by 25.3% yoy in 2QFY19 led largely by volume growth. Truck-bus radial tire volumesgrew by almost 35% yoy driven by strong industry growth and continued market share gains for the company.

RM cost per kg increased by 2.5% qoq in 2QFY19 and will inch up further in 3QFY19 due to delayed impact ofincrease in crude prices and rupee depreciation. The company has taken 2.5% price hike across segments in end-September/early October and has announced similar increase in November as well.

Hungary plant is ramping up quite well and exports from India have come down significantly.

The company plans to incur capex of Rs65bn over the next three years – (1) Rs55 bn in India, which will be towardsgreenfield plant in Andhra (Rs38 bn), de-bottlenecking of passenger vehicle capacity from current capacity of35,000 tires per day (10% capacity addition), conversion of truck bias tire capacity to OHT tires, setting up of smalltwo-wheeler radial tire capacity and maintenance capex and (2) Rs.10 bn in Europe towards completion of capex inHungary plant and maintenance capex in the Netherlands plant.

On the issue related to promoter’s compensation, based on the inputs from an independent report by Ernst & Young(EY), the Nominations & Remuneration Committee of the company has decided to cap promoter’s salary at 7.5% ofPBT (from 10% of PBT earlier); FY2018 promoter’s salary was 9.3% of consolidated PBT. The committee has furthersuggested lowering the salary cap in coming years from 7.5% of PBT set currently.

We expect Apollo’s outperformance in the India business (compared to peers) to sustain over the next few years

Going ahead, even as India business remains on a strong footing, we expect performance of Europe business toimprove over the next two years.

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Apollo Tyres Ltd Nifty

Coal India Limited


Financials (Rs mn)* FY18 FY19E FY20ESales 964,363 1,041,355 1,101,127 Growth (%) 15.8 8.0 5.7 EBITDA 196,081 223,391 231,988 EBITDA margin (%) 20.3 21.5 21.1 PBT 238,401 245,492 250,485 Net profit 160,826 164,013 167,541 Adjusted EPS (Rs) 25.9 26.4 27.0 Growth (%) 129.1 2.0 2.3 P/E (x) 9.4 9.3 9.0 BV (Rs/share) 34.0 32.0 29.0 ROE (%) 78.0 80.0 88.0 Source: BloombergROCE (%) 90.0 91.0 100.0 Free Cash Flow 28,899.0 1,57,694 2,18,068

Source: Kotak Insitutional Equities; *Consolidated

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgRevenues 358,828 433,105 20.7 EBITDA 33,258 64,983 95.4 EBITDA Margin (%) 9.3% 15.0%PAT 27,201 68,705 152.6 PAT Margin (%) 7.6% 15.9%EPS (Rs) 4.3 10.1 134.9 Source: Kotak Insitutional Equities; *Consolidated Source: Bloomberg

This one pager contains information like company background, risks & concerns, graphs and tables inputed by Kotak PCG research team. The price target is that of KIE (kindlyrefer to the Rating Scale of KIE at the end of this report). The Investment Arguments are extracted from KIE updates dated September 21, October 3, November 2, andNovember, 12, 2018 and Financial estimates are extracted from last KIE update dated November 12, 2018 and it does not contain events beyond that date. We take noobligation to update the KIE recommendations.


Analyst: Murtuza Arsiwalla, Samrat Verma




Promoter78.3%

FII5.7%

DII13.0%

Others3.0%

Key Highlights:

Coal India has started FY2019 on a firm footing with 1HFY19 delivering 153% YoY growth in earnings on the back of21% YoY growth in revenue. We expect the earnings momentum to continue on the back of double-digit growth in realizations and healthy volume growth.

Coal India reported 3.6% YoY growth in coal dispatches at 50 mn tons in October 2018 with all but two subsidiariesreporting positive volume growth. Production volumes were healthy with a growth of 7.9% YoY in October 2018.Overall YTD performance remains healthy with 7.4% YoY growth in dispatches and 10.2% YoY growth in productionvolumes.

Coal inventory has decreased to six days for October 2018, from a nine day average in 2QFY19. As many as 19 plantswith critical/super-critical inventories are located in the West out of a total of 28 plants across India. East has noplants with critical inventory while North and South have four and five plants each.

E-auction premiums increased to 102% in September 2018 from 93% seen in August 2018. Premiums are still well above those seen in FY2018, and should also be seen in the context of the price increase taken in January 2018.

CIL continued to maintain an elevated capex with Rs85 bn incurred in FY18, almost similar to Rs87 bn incurred in FY17though meaningfully higher than the 4-year average capex of Rs68 bn.

The long awaited railway lines are being commissioned in parts, with two railway lines in Tori-Shivpuri and Jharsaguda-Barpali having been commissioned during the year.

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Coal India Limited Nifty

Cochin Shipyard Limited (CSL)


Financials (Rs mn)* FY18 FY19E FY20ESales 23,922 26,514 27,921 Growth (%) 16.2 16.2 10.8 EBITDA 4,979 5,437 5,959 EBITDA margin (%) 20.8 20.5 21.3 PBT 6,021 6,062 6,420 Net profit 3,998 4,025 4,263 Adjusted EPS (Rs) 29.4 30.6 32.4 Growth (%) 28.1 0.7 5.9 P/E (x) 13.3 12.8 12.0 BV (Rs/share) 235.4 246.5 267.1 Dividend / share (Rs) 12.0 10.0 10.0 Source: BloombergROE (%) 12.5 12.4 12.1 ROCE (%) 13.5 14.2 14.0 Net cash (debt) 26,913 22,713 20,376 Source: Kotak Securities - Private Client Research; *Consolidated

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgRevenues 11,766 14,581 23.9 EBITDA 2,456 3,033 23.5 EBITDA Margin (%) 20.9% 20.8%PAT 1,915 2,539 32.6 PAT Margin (%) 16.3% 17.4%EPS (Rs) 14.1 18.7 32.6 Source: Kotak Securities - Private Client Research; *Consolidated Source: Bloomberg

This one pager on the company is extracted from last Kotak Securities – Private Client Research update dated October 29, 2018 and it does not contain events beyond thatdate. Above company recommendation is of Kotak Securities – Private Client Research which has a different rating system than Kotak Institutional Equities as disclosed inthe end of the report (before Disclaimer). It is advisable to read the full Kotak Securities – Private Client Research report before taking any investment decision on the abovecompany recommendation


Analyst: Amit Agarwal

Price Performance (Since August 2017)



Promoter75.0%

FII2.7%

DII10.8%

Others11.5%

Key Highlights: Cochin Shipyard (CSL) is a Government company, incorporated on March 29, 1972 and was conferred the 'Miniratna'

status in 2008, by the Department of Public Enterprise. It is the largest public sector shipyard in India in terms of dockcapacity

The company caters to clients engaged in the defence sector in India and clients engaged in the commercial sectorworldwide. In addition to shipbuilding and ship repair

CSL also offer marine engineering training. CSL currently has two docks - dock number one, primarily used for ship repair (Ship Repair Dock) and dock number two,

primarily used for shipbuilding (Shipbuilding Dock). CSL currently has a shipbuilding order book of Rs 19.62 bn which gives investors revenue visibility of only one year. The company is also a L1 bidder for an order worth Rs 54 bn for 8 Anti-Submarine Warfare- Shallow water vessel from

the Indian navy. Management of Cosh expects to convert this L1 bid to actual orders within FY19 post completion offormalities with the Indian Navy.

CSL currently has an order-book of Rs 3.5 bn in the ship-repair segment. The company intends to expand in ship-repair segment with an international ship-repair center and increased geographical reach.

CSL would be ramping up its capacity with a third dry-dock (measuring 310 x 75 x 13 Meters) and an international ship-repair center at Kochi. The capacity addition will enable the company to construct bigger and complex vessels as wellas undertake repairs of vessels like LNG carriers, semi-submersibles

CSL is one of the best companies to invest to play in the India's defence sector. We estimate company to report salesCAGR of 8.1% over FY18 to FY20E to Rs 27.9 bn and report earnings CAGR of 3.3% over the same period to Rs 4.26 bn.

Diversified offering, recurring orders from the defence, focus on ship repair segment and strong BS gives us comfortwith the stock. Recommend BUY with a TP of Rs 520 at 16x FY20 earnings.

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Cochin Shipyard Limited (CSL)Nifty

Mold-Tek Packaging (MTPL)


Financials (Rs mn)* FY18 FY19E FY20ESales 3,577 4,404 5,017 Growth (%) 15.8 23.1 13.9 EBITDA 615 743 863 EBITDA margin (%) 17.2 16.9 17.2 PBT 447 560 659 Net profit 278 373 439 Adjusted EPS (Rs) 10.1 13.5 15.9 Growth (%) 14.7 34.1 17.6 P/E (x) 26.8 20.0 17.0 BV (Rs/share) 61.2 69.7 80.5 Dividend / share (Rs) 4.0 5.0 5.0 Source: BloombergROE (%) 16.0 19.1 19.7 ROCE (%) 16.3 16.8 17.3 Net cash (debt) (845) (1,019) (1,048) Source: Company; Kotak Securities - Private Client Research *Consolidated

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgRevenues 1,670 2,028 21.4 EBITDA 298 344 15.6 EBITDA Margin (%) 17.8% 17.0%PAT 142 155 8.8 PAT Margin (%) 8.5% 7.6%EPS (Rs) 5.1 5.6 8.8 Source: Kotak Securities - Private Client Research; *Consolidated Source: Bloomberg

This one pager on the company is extracted from last Kotak Securities – Private Client Research update dated November 27, 2018 and it does not contain events beyond that date.Above company recommendation is of Kotak Securities – Private Client Research which has a different rating system than Kotak Institutional Equities as disclosed in the end ofthe report (before Disclaimer). It is advisable to read the full Kotak Securities – Private Client Research report before taking any investment decision on the above companyrecommendation.


Analyst: Jatin Damania




Promoter35.6%

FII8.3%

DII12.6%

Others43.6%

Key Highlights: Mold Tek Packaging stands to gains in the coming years from the increasing share of IML, backward integration and

expansion in the food and FMCG industry.

MTPL was the first company to offer IML technology in 2011, while others were focusing on screen printing and heat transfer labelling (HTL). IML is a high margin (300-400bps higher) technology compared to the traditional methods.Emerged as one of the leading manufacturers and suppliers of high quality airtight and pilfer containers/pails in India for paints, lubricants and FMCG (includes Edible Oil) industry.

Mysore/Vizag plants to be operational from Dec-2018/Feb-2019 and business to start from April-2019. The management expects these capacities will help the company to continue to grow at 20% annually for the next 2-3 years.

The Q-packs of edible oil and ghee, witnessed robust demand from various companies across Madhya Pradesh, Gujaratand Rajasthan and numbers are even better in the month of Oct and Nov, 2018. In addition, the company is also planning to introduce a range of ghee packs for retail packs, which will further increase the contribution of F&F inoverall revenue share. The management is confident to achieve 20% share from F&F in FY19 and increase it further inthe coming years.

The company recently on board HUL, as it customers for ice cream packs, which can add incremental revenue of Rs40-50 mn annually, this will further strengthen the contribution from F&F segment.

Expect MTPL to continue delivering strong growth in the coming years on the back of integrated facilities and increasing revenue from the high margin FMCG industry.

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Mold-Tek Packaging (MTPL) Nifty

MRPL


Financials (Rs mn)* FY18 FY19E FY20ESales 490,550 606,286 632,215 Growth (%) 12.1 23.6 4.3 EBITDA 45,020 38,747 44,907 EBITDA margin (%) 9.2 6.4 7.1 PBT 28,713 22,303 29,528 Net profit 19,926 15,612 19,931 Adjusted EPS (Rs) 11.4 8.9 11.4 Growth (%) (42.6) (21.7) 27.7 P/E (x) 6.5 8.3 6.5 BV (Rs/share) 58.4 65.0 73.0 Dividend / share (Rs) 3.0 2.3 3.1 Source: BloombergROE (%) 17.7 14.1 16.0 ROCE (%) 12.9 11.6 13.1 Net cash (debt) (99,073) (87,822) (72,456) Source: Company; Kotak Securities - Private Client Research *Consolidated

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgRevenues 269,108 343,156 27.5 EBITDA 14,909 9,574 (35.8) EBITDA Margin (%) 5.5% 2.8%PAT 7,379 2,819 (61.8) PAT Margin (%) 2.7% 0.8%EPS (Rs) 4.1 1.6 (60.6) Source: Kotak Securities - Private Client Research; *Standalone Source: Bloomberg

This one pager on the company is extracted from last Kotak Securities – Private Client Research update dated October 29, 2018 and it does not contain events beyond thatdate. Above company recommendation is of Kotak Securities – Private Client Research which has a different rating system than Kotak Institutional Equities as disclosed inthe end of the report (before Disclaimer). It is advisable to read the full Kotak Securities – Private Client Research report before taking any investment decision on the abovecompany recommendation


Analyst: Sumit Pokharna




Promoter88.6%

FII1.6%

DII3.2%

Others6.6%

Key Highlights: MRPL (Mini-Ratna status) is a pure play crude oil refiner with strong promoter backing of ONGC (India's biggest government owned

exploration Company). MRPL has transformed itself into a large and complex refinery with phase-III capacity expansion and has emerged into a much stronger player in the industry.

With the recent correction in crude oil price, we believe the margins should improve in the medium term. The company's management has indicated that it aims to achieve crude throughput of 16 mmtpa in FY19.

In the medium to long term, the key factors to watch out are GRMs, rupee movement, oil prices and product demand. Further, investors are waiting for an announcement of swap ratio for merger of MRPL with HPCL.

Marketing initiatives: Direct marketing has increased MRPL's market presence for Petcoke, Sulphur and Polypropylene. It is also increasing its product grades of Polypropylene to enhance Polypropylene (PP) market share which will improve margins.

The Company has bagged the prestigious "FieldComm group 2018 Plant of the Year" Global award conferred by FieldComm group. The Company is the first Indian company to receive this International award.

New expansion plans in place - Growth is a process: MRPL has set-up the next milestone and is planning to enhance its refining capacity to 25 mmtpa as against current capacity of 15.5 mmtpa. Additionally, the company is planning to scale up its petrochemical capacity to boost its margins. The Company will invest Rs.110 bn in this expansion. We like the sharpened focus of the company on itsgrowth strategy. The expansion is seen as a major margin driver as it will help the company to process cheaper, heavier crudes into high-value products like diesel, liquefied petroleum gas and propylene.

Re-commencing retail outlets: The Company has commissioned COCO (company owned and company operated) retail outlet inMangalore and also commissioned its DODO (dealer owned dealer operated) retail outlet. In Karnataka, this is the sixth RO for MRPL. MRPL has drawn up plans for opening over 100 retail outlets which will improve its overall margins due to addition of marketing margins.

Auto fuel up-gradation: MRPL is in the process of upgrading its facilities to produce BS-VI grade MS& HSD by April 2020. Going ahead, MRPL's profitability will be supported by i). Improved product mix, ii). Better margins iii). Economies of scale, iv). Forward

integration - Polypropylene plant and v). Various tax benefits.

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MRPL Nifty

State Bank of India


Financials (Rs mn)* FY18 FY19E FY20ENet Interest Income 748,537 883,160 1,011,236Non-interest Income 446,007 367,283 483,846 Total Income 1,194,544 1,250,443 1,495,083Growth (%) 1.4% 4.7% 19.6%PBT (155,282) 95,676 501,653 Net profit (65,475) 66,974 351,157 EPS (Rs) (7.7) 7.5 39.3 Book Value (Rs) 135.4 156.8 214.7 P/B (x) 2.1 1.8 1.3

Slippages (%) 6.0% 2.5% 1.5% Source: BloombergGross NPL (%) 10.7% 8.3% 6.8%Net NPL (%) 5.7% 3.9% 2.6%ROE (%) -3.2% 3.0% 14.5%RoA (%) -0.2% 0.2% 0.9%Source: Kotak Insitutional Equities

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgNet Interest Income 361,919 427,041 18.0%Non-Interest Income 240,217 160,545 -33.2%Total Income 602,136 587,586 -2.4%PBT 38,063 (54,425) -243.0%PAT 35,871 (39,310) -209.6%Slippages (%) 4.2% 2.6%Source: Kotak Insitutional Equities; *Consolidated Source: Bloomberg

This one pager on the company is extracted from last KIE update dated November 13, 2018 and it does not contain events beyond that date. We take no obligation to updatethe KIE recommendations. Above company recommendation is of KIE which has a different rating system than Kotak PCG as disclosed in the end of the report (beforeDisclaimer). While source of all other information is taken from Kotak Institutional Equities, the price performance and shareholding pattern chart is inputted by Kotak PCGresearch team (with source as Bloomberg). It is advisable to read the full KIE report before taking any investment decision on the above company recommendation.


Analyst: MB Mahesh, CFA/ Nischint Chawathe/ Dipanjan Ghosh




Promoter58.6%

FII10.2%

DII23.8%

Others7.5%

Key Highlights: SBI reported a profit of Rs 9.5 bn in 2QFY19, as provisions declined 40%. Revenue declined 12% YoY despite NII growth

of 12% YoY, primarily due to weak fee income growth and lower contribution from treasury book. 2QFY19 saw the second consecutive quarter of improvement in gross and net NPL ratios. Gross NPLs declined 75 bps

QoQ to less than 10% while net NPLs declined 45 bps QoQ on to 4.8% of loans. Slippages for the quarter declined to2.3% of loans with most of the corporate slippages coming from the watch-list.

SBI has negligible exposure to IL&FS and subsidiaries. The bank reported Rs 2.5 bn exposure to the holding companyand Rs 35 bn (0.01% of loans) of exposure to the group via SPVs (around 14 in number).

Overall loan growth (net) improved to 9% YoY driven by robust growth in retail loans and gradual revival in corporateloan growth; albeit at a muted pace. On gross basis, retail loans saw robust increase at 14% YoY. SME growth stood at5% YoY.

Retail segment constitutes ~28% of the loan book (up 120 bps YoY). Corporate book comprises 36% of loan book (up70 bps QoQ). Bank will look at maintaining the share of corporate book in 36-40% range based on the opportunities in the corporate segment.

CASA ratio stood at 44% in 2QFY19 (up 50 bps YoY and 20 bps QoQ) led by strong growth in SA balances. SA growthimproved to 9% YoY while CA revived to 6% YoY. Bank has benefitted from higher average balances in savingsaccounts post demonetization, greater traction in corporate salary packages and new current accounts.

CAR and CET-1 stood comfortable at 12.6% and 9.7%, respectively.

We expect the stock to re-rate as we believe - the bank has embarked on a favorable journey of NPL resolution; loan growth is accelerating; NIM has scope for expansion; Operating expenses are not showing any negative surprises.

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State Bank of IndiaNifty

Supreme Industries Ltd


Financials (Rs mn)* FY18 FY19E FY20ESales 49,663 57,656 67,243 Growth (%) 11.3 16.1 16.6 EBITDA 7,871 8,781 10,519 EBITDA margin (%) 15.8 15.2 15.6 PBT 6,028 6,731 8,302 Net profit 3,971 4,434 5,469 Adjusted EPS (Rs) 31.3 34.9 43.0 Growth (%) 5.4 11.7 23.3 P/E (x) 31.8 28.5 23.1 BV (Rs/share) 149.1 170.0 199.0 Dividend / share (Rs) 12.0 12.0 12.0 Source: BloombergROE (%) 22.1 21.9 23.3 ROCE (%) 30.1 30.2 33.6 Net cash (debt) (2,164) (1,702) 86 Source: Company; Kotak Securities - Private Client Research *Consolidated

Financials (Rs mn)* 1H-FY18 1H-FY19 % ChgRevenues 22,167 26,619 20.1 EBITDA 3,026 3,982 31.6 EBITDA Margin (%) 13.7% 15.0%PAT 1,351 2,351 74.0 PAT Margin (%) 6.1% 8.8%EPS (Rs) 10.6 18.5 74.0 Source: Kotak Securities - Private Client Research; *Consolidated Source: Bloomberg

This one pager on the company is extracted from last Kotak Securities – Private Client Research update dated October 30, 2018 and it does not contain events beyond thatdate. Above company recommendation is of Kotak Securities – Private Client Research which has a different rating system than Kotak Institutional Equities as disclosed inthe end of the report (before Disclaimer). It is advisable to read the full Kotak Securities – Private Client Research report before taking any investment decision on the abovecompany recommendation.


Analyst: Pankaj Kumar




Promoter49.7%

FII7.2%

DII22.0%

Others21.1%

Key Highlights:

Supreme Industries Ltd (SIL) is the major player in the plastic pipes business with established brand equity anddiverse presence across other business segments such as packaging, industrial products, plastic furniture, etc.

The company manufactures and sells diverse range of plastic products broadly categorized across 5 differentverticals, plastic piping system, consumer products, industrial products, packaging products and composite products.

SIL has track record of generating high ROCE of ~30-35% with low debt/equity and strong positive operating cashflows driven by 1) efficient utilization of assets 2) diverse products mix with increasing share of high margins valueadded products 3) better working capital management v/s its peers.

SIL management has guided for 10% growth in volume with 14.5-15% EBITDA margin in FY19E driven by robust plastic demand across most of the segments and increased contribution from high margin and value added products.

SIL has 25 manufacturing units spread across geographies with pastic processing capacity of 567,850 tonnes perannum.

The company is increasing capacity across segments which would help in maintaining volume growth. It is adding50,000 tonne per annum capacity every year in FY19E-FY21E with total capex of Rs 12-13 bn funded largely through internal accruals.

The company is positive on composite cylinder business and expects order from domestic as well as internationalmarket in FY19E.

We expect earnings to grow at faster pace in the next two years on improved volume growth outlook for the company, focus on increasing share of value added products and its ability to pass on increase in raw material prices.

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Supreme Industries Ltd Nifty

RATING SCALE (KOTAK SECURITIES – PRIVATE CLIENT RESEARCH) Definitions of ratings BUY – We expect the stock to deliver more than 12% returns over the next 12 months ACCUMULATE – We expect the stock to deliver 5% - 12% returns over the next 12 months REDUCE – We expect the stock to deliver 0% - 5% returns over the next 12 months SELL – We expect the stock to deliver negative returns over the next 12 months NR – Not Rated. Kotak Securities is not assigning any rating or price target to the stock. The report has been prepared for

information purposes only. RS – Rating Suspended. Kotak Securities has suspended the investment rating and price target for this stock, either because there

is not a Sufficient fundamental basis for determining, or there are legal, regulatory or policy constraints around publishing, 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. NOTE – Our target prices are with a 12-month perspective. Returns stated in the rating scale are our internal benchmark.

RATING SCALE (KOTAK INSTITUTIONAL EQUITIES) Ratings and other definitions/identifiers

Definitions of rating 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 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.

FUNDAMENTAL RESEARCH TEAM (PRIVATE CLIENT RESEARCH) Rusmik Oza Arun Agarwal Amit Agarwal Nipun Gupta Deval Shah Head of Research Auto & Auto Ancillary Transportation, Paints, FMCG Information Tech, Midcap Research Associate [email protected] [email protected] [email protected] [email protected] [email protected] +91 22 6218 6441 +91 22 6218 6443 +91 22 6218 6439 +91 22 6218 6433 +91 22 6218 6423

Sanjeev Zarbade Ruchir Khare Jatin Damania Cyndrella Carvalho Ledo Padinjarathala Cap. Goods & Cons. Durables Cap. Goods & Cons. Durables Metals & Mining, Midcap Pharmaceuticals Research Associate [email protected] [email protected] [email protected] [email protected] [email protected] +91 22 6218 6424 +91 22 6218 6431 +91 22 6218 6440 +91 22 6218 6426 +91 22 6218 7021

Teena Virmani Sumit Pokharna Pankaj Kumar Krishna Nain K. Kathirvelu Construction, Cement, Buildg Mat Oil and Gas, Information Tech Midcap M&A, Corporate actions Support Executive [email protected] [email protected] [email protected] [email protected] [email protected]+91 22 6218 6432 +91 22 6218 6438 +91 22 6218 6434 +91 22 6218 7907 +91 22 6218 6427

TECHNICAL RESEARCH TEAM (PRIVATE CLIENT RESEARCH) Shrikant Chouhan Amol Athawale [email protected] [email protected] +91 22 6218 5408 +91 20 6620 3350

DERIVATIVES RESEARCH TEAM (PRIVATE CLIENT RESEARCH) Sahaj Agrawal Malay Gandhi Prashanth Lalu Prasenjit Biswas, CMT, CFTe [email protected] [email protected] [email protected] [email protected] +91 79 6607 2231 +91 22 6218 6420 +91 22 6218 5497 +91 33 6625 9810

Disclosure/Disclaimer – Kotak Securities Ltd

Following analysts: Nishit Jalan, Hitesh Goel, Murtuza Arsiwalla, Samrat Verma, M.B. Mahesh, Nischint Chawathe, Dipanjan Ghosh of Kotak Institutional Equities and Amit Agarwal, Pankaj Kumar, Jatin Damania & Sumit Pokharna of Kotak Securities – Private Client Research hereby certify that all of the views expressed in this report accurately reflect their personal views about the subject company or companies and its or their securities. They also certify that no part of their compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Kotak Securities Limited established in 1994, is a subsidiary of Kotak Mahindra Bank Limited. Kotak Securities is one of India's largest brokerage and distribution house.

Kotak Securities Limited is a corporate trading and clearing member of Bombay Stock Exchange Limited (BSE), National Stock Exchange of India Limited (NSE), Metropolitan Stock Exchange of India Limited (MSE), National Commodity and Derivatives Exchange (NCDEX) and Multi Commodity Exchange (MCX). Our businesses include stock broking, services rendered in connection with distribution of primary market issues and financial products like mutual funds and fixed deposits, depository services and Portfolio Management.

Kotak Securities Limited is also a depository participant with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). Kotak Securities Limited is also registered with Insurance Regulatory and Development Authority as Corporate Agent for Kotak Mahindra Old Mutual Life Insurance Limited and is also a Mutual Fund Advisor registered with Association of Mutual Funds in India (AMFI). We are registered as a Research Analyst under SEBI (Research Analyst) Regulations, 2014.

We hereby declare that our activities were neither suspended nor we have defaulted with any stock exchange authority with whom we are registered in last five years. However SEBI, Exchanges and Depositories have conducted the routine inspection and based on their observations have issued advise/warning/deficiency letters/ or levied minor penalty on KSL for certain operational deviations. We have not been debarred from doing business by any Stock Exchange / SEBI or any other authorities; nor has our certificate of registration been cancelled by SEBI at any point of time.

We offer our research services to clients as well as our prospects.

This document is not for public distribution and has been furnished to you solely for your information and must not be reproduced or redistributed to any other person. Persons into whose possession this document may come are required to observe these restrictions.

This material is for the personal information of the authorized recipient, and we are not soliciting any action based upon it. This report is not to be construed as an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal. It is for the general information of clients of Kotak Securities Ltd. It does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients.

We have reviewed the report, and in so far as it includes current or historical information, it is believed to be reliable though its accuracy or completeness cannot be guaranteed. Neither Kotak Securities Limited, nor any person connected with it, accepts any liability arising from the use of this document. The recipients of this material should rely on their own investigations and take their own professional advice. Price and value of the investments referred to in this material may go up or down. Past performance is not a guide for future performance. Certain transactions -including those involving futures, options and other derivatives as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. Reports based on technical analysis centers on studying charts of a stock's price movement and trading volume, as opposed to focusing on a company's fundamentals and as such, may not match with a report on a company's fundamentals.

Opinions expressed are our current opinions as of the date appearing on this material only. While we endeavor to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance or other reasons that prevent us from doing so. Prospective investors and others are cautioned that any forward-looking statements are not predictions and may be subject to change without notice. Our proprietary trading and investment businesses may make investment decisions that are inconsistent with the recommendations expressed herein.

Kotak Securities Limited has two independent equity research groups: Institutional Equities and Private Client Group. This report has been prepared by the Private Client Group. The views and opinions expressed in this document may or may not match or may be contrary with the views, estimates, rating, target price of the Institutional Equities Research Group of Kotak Securities Limited.

We and our affiliates/associates, officers, directors, and employees, Research Analyst(including relatives) worldwide may: (a) from time to time, have long or short positions in, and buy or sell the securities thereof, of company (ies) mentioned herein or (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the subject company/company (ies) discussed herein or act as advisor or lender / borrower to such company (ies) or have other potential/material conflict of interest with respect to any recommendation and related information and opinions at the time of publication of Research Report or at the time of public appearance. Kotak Securities Limited (KSL) may have proprietary long/short position in the above mentioned scrip(s) and therefore may be considered as interested. The views provided herein are general in nature and does not consider risk appetite or investment objective of particular investor; readers are requested to take independent professional advice before investing. This should not be construed as invitation or solicitation to do business with KSL. Kotak Securities Limited is also a Portfolio Manager. Portfolio Management Team (PMS) takes its investment decisions independent of the PCG research and accordingly PMS may have positions contrary to the PCG research recommendation. Kotak Securities Limited does not provide any promise or assurance of favourable view for a

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particular industry or sector or business group in any manner. The investor is requested to take into consideration all the risk factors including their financial condition, suitability to risk return profile and take professional advice before investing.

The analyst for this report certifies that all of the views expressed in this report accurately reflect his or her personal views about the subject company or companies and its or their securities, and no part of his or her compensation was, is or will be, directly or indirectly related to specific recommendations or views expressed in this report.

No part of this material may be duplicated in any form and/or redistributed without Kotak Securities' prior written consent.

Details of Associates are available on www.kotak.com

Research Analyst has served as an officer, director or employee of subject company(ies): No

We or our associates may have received compensation from the subject company(ies) in the past 12 months.

We or our associates have managed or co-managed public offering of securities for the subject company(ies) in the past 12 months: No

We or our associates may have received compensation for investment banking or merchant banking or brokerage services from the subject company(ies) in the past 12 months. We or our associates may have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company(ies) in the past 12 months. We or our associates may have received compensation or other benefits from the subject company(ies) or third party in connection with the research report. Our associates may have financial interest in the subject company(ies).

Research Analyst or his/her relative's financial interest in the subject company(ies): No

Kotak Securities Limited has financial interest in the subject company(ies) at the end of the month immediately preceding the date of publication of Research Report: Apollo Tyre, Coal India, MRPL - Yes

Our associates may have actual/beneficial ownership of 1% or more securities of the subject company(ies) at the end of the month immediately preceding the date of publication of Research Report.

Research Analyst or his/her relatives has actual/beneficial ownership of 1% or more securities of the subject company(ies) at the end of the month immediately preceding the date of publication of Research Report: No.

Kotak Securities Limited has actual/beneficial ownership of 1% or more securities of the subject company(ies) at the end of the month immediately preceding the date of publication of Research Report: No

Subject company(ies) may have been client during twelve months preceding the date of distribution of the research report.

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Kotak Securities Limited. Registered Office: 27 BKC, C 27, G Block, Bandra Kurla Complex, Bandra (E), Mumbai 400051. CIN: U99999MH1994PLC134051, Telephone No.: +22 43360000, Fax No.: +22 67132430. Website: www.kotak.com/www.kotaksecurities.com. Correspondence Address: Infinity IT Park, Bldg. No 21, Opp. Film City Road, A K Vaidya Marg, Malad (East), Mumbai 400097. Telephone No: 42856825. SEBI Registration No: INZ000200137 (Member of NSE, BSE & MSE), AMFI ARN 0164, PMS INP000000258 and Research Analyst INH000000586. NSDL/CDSL: IN-DP-NSDL-23-97. Our research should not be considered as an advertisement or advice, professional or otherwise. The investor is requested to take into consideration all the risk factors including their financial condition, suitability to risk return profile and the like and take professional advice before investing. Investments in securities market are subject to market risks, read all the related documents carefully before investing. Derivatives are a sophisticated investment device. The investor is requested to take into consideration all the risk factors before actually trading in derivative contracts. Compliance Officer Details: Mr. Manoj Agarwal. Call: 022 - 4285 8484, or Email: [email protected].

In case you require any clarification or have any concern, kindly write to us at below email ids:

Level 1: For Trading related queries, contact our customer service at '[email protected]' and for demat account related queries contact us [email protected] or call us on: Toll free numbers 18002099191 / 1860 266 9191

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Level 4: If you have not received a satisfactory response at Level 3 within 7 working days, you may also approach CEO (Mr. Kamlesh Rao) at [email protected] or call on 91- (022) 4285 8301.

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