eq industry 5.1 hmsi - icici...
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ICICI Securities Ltd. | Retail Equity Research
May 25, 2017
MotoGaze May 2017
New fiscal commences on good note!
Overall auto volumes for April 2017 grew 9.5% YoY. This is primarily
attributable to positive consumer sentiments (ongoing marriage season &
recovery from demonetisation). Growth was also partly supported by
higher stock filling (by OEMs) at dealer level to normalise inventory level
in the system (after liquidation of BS III vehicles). Overall 2-W volumes
grew 10.5% YoY, strongly supported by scooter space (grew 25.5% YoY).
HMSI – the second largest 2-W player registered strong growth of 34%
YoY thereby narrowing the gap between itself & market leader HMCL. The
overall PV segment continued its strong growth momentum, registering
growth of 14.4% YoY. The growth was supported by both cars & utility
vehicle (UV), which reported growth of 15.4% YoY & 16.9% YoY,
respectively. The PV market leader, MSIL, reported strong volume growth
of 19.5% YoY and continued to outpace overall industry growth. Overall
CV volumes declined 25% YoY as M&HCV volumes reported sharp de-
growth of 50.9% YoY, while LCV segment reported moderate de-growth
of 5.4% YoY for April 2017. M&HCV players were unable to ramp up and
produce higher BS IV vehicles in April 2017 as OEMs were planning to
gradually increase their production thereby impacting volumes for April
2017. The 3-W volumes fell 6.3% YoY as domestic volumes continued to
decline (down 18% YoY). However, the same was offset by some export
recovery (volume up 22.7% YoY). A good harvest season & higher MSPs
supported domestic tractor volumes, which grew 19.3% YoY.
HMSI & MSIL dominate in April 2017
Strong volume growth was largely registered by two players viz. HMSI (in
the 2-W space) & MSIL (in the 4-W) space driving overall auto volumes for
the industry. HMSI reported strong volume growth of 34% YoY to 578,777
units, led by robust growth in its scooter segment (Activa volumes up
33.6% YoY to 312,632 units). Its strong volume growth further narrowed
the gap (to 16,841 units) between HMSI & market leader HMCL. MSIL (in
the 4-W space) continued to outpace the industry, with volumes up 19.5%
YoY to 150,768 units. Of the top 10 selling PV models, seven models
continue to be of MSIL. However, the top selling car – Alto has now been
replaced by Swift for April 2017. Apart from that, TVS’ mopeds volumes
declined 12.9% YoY to 59,674 units mainly due to high base
Near term hiccup fading away; long term story intact
After four years of subdued growth (FY12-16 volume CAGR of 4%), auto
demand recovered. Volumes were up 11.1% YoY in 7MFY17.
Demonetisation had a short-term (<six months) negative impact mainly
due to deferral of vehicle purchase, impacting FY17 volumes, which grew
5.1% YoY. However, we believe long term growth expectations of the
sector remain intact, primarily supported by the positive impact of the
Seventh Pay Commission, emission norms (BS VI by 2020) & vehicle
scrappage policy. Further, the Indian Meteorological Department (IMD)
predicts near normal monsoon at 96% of long period average (LPA) for
upcoming monsoon season 2017, which is positive for the economy.
Normal monsoon will be positive for rural areas thereby boosting auto
demand (especially 2-W & tractor segment). We expect industry volumes
to grow >8%, with 2W, PV & CV segment likely to grow 8%, 9% & 8%
YoY, respectively, in FY18E.
For April 2017, the BSE Auto Index was up 3.5% outperforming the
benchmark index, which surged 1%. In our I-direct auto coverage, we
remain bullish on frontline OEM stocks like Maruti Suzuki and Eicher
Motors. However, with the favourable impact of operating leverage due to
increased demand, the earnings growth trajectory for ancillary stocks is
likely to remain on the uptrend.
Sector View
Equal weight
Volume performance for April 2017
Company Gr. YoY(%)
Hero Motocorp -2.8
Bajaj Auto 0.0
TVS Motors 8.4
Maruti Suzuki 19.5
Tata Motors -21.4
Ashok Leyland -30.4
Mahindra and Mahindra -6.0
Key players & industry volume growth – Apr’17 (%)
7.5
-2.3
21.2
-4.0
58.1
8.2
-45.8
-29.8
1.4
-62.0
9.5
-2.8
0.0
8.4
34.3
19.5
-21.4
-6.0
3.6
-30.4
Industry
HMCL
BAL
TVS
HMSI
Maruti
TML
M&M
Hyundai
ALL
MoM
YoY
Source: Siam
Key players & industry volume growth FY17 (%)
5.1
0.5
-5.9
10.8
12.6
9.8
6.1
2.5
4.7
3.3
Industry
HMCL
BAL
TVS
HMSI
Maruti
TML
M&M
Hyundai
ALL
FY17 gr
Source: Siam
Research Analyst
Nishit Zota
Vidrum Mehta
ICICI Securities Ltd. | Retail Equity Research
Page 2
HMSI drives overall two-wheeler volumes!
For April 2017, overall 2-W volumes grew 10.5% YoY mainly supported by
scooters segment, which reported strong growth of 25.5% YoY. The
motorcycle segment reported growth of 5.7% YoY. The moped segment,
which in the past registered >15% YoY growth, has taken a breather in
the past two or three months, with volumes down 12.9% YoY. Further,
overall domestic 2-W volumes grew 7.3% YoY while exports volumes
grew 40% YoY for April 2017. For FY17, the 2-W segment registered 5.2%
YoY growth, driven by scooter segment (up 11.3% YoY) and mopeds (up
23.3% YoY). The motorcycle segment registered modest growth of 1.6%
YoY for FY17. For April 2017, the 3-W volumes declined 6.3% YoY, as
domestic volumes continued to remain weak (down 18% YoY). However,
the same was offset by an export recovery (volume up 22.7% YoY). For
April 2017, the domestic tractor volume grew 19.3% YoY 54,917 units.
Market share movement
According to data released by the Society of Indian Automobile
Manufacturers (Siam), the domestic market share of two and three-
wheeler players as of April 2017 is mentioned below.
Exhibit 1: Domestic market share movement in two-wheelers
12.85
38.49
12.67
26.54
9.46
11.38
36.86
14.15
26.86
10.74
9.67
34.97
12.27
32.94
10.15
0
5
10
15
20
25
30
35
40
45
Bajaj Auto Hero MotoCorp TVS Motors HMSI Others
(%
)
Apr-16 Mar-17 Apr-17
Source: Siam, Data used is YTD
Exhibit 2: Domestic market share movement in three-wheelers
57.6
28.0
8.4
6.1
49.5
29.5
10.2
10.8
43.6
28.0
9.4
19.0
0 10 20 30 40 50 60 70
Bajaj Auto
Piaggio
M&M
Others
(%)
Apr-16 Mar-17 Apr-17
Source: Siam, Data used is YTD
The overall 2-W segment volumes grew 10.5% YoY in April
2017. HMSI reported robust volume growth of 34.3% YoY;
thereby gaining market share (up 641 bps YoY) to 32.9%. On the
flip side, HMCL volumes declined 2.8% YoY thereby losing its
market share, which is currently at ~35%
In April 2017, domestic 3W volumes declined 18% YoY. This
is mainly after the top two players viz. - Bajaj Auto & Piaggio
reported volume de-growth of 37.9% YoY & 17.8% YoY,
respectively, resulting in a loss of market share. The other
players viz. - TVS reported decent volume growth while Atul
Auto also posted strong YoY growth (mainly due to low base
of last year)
ICICI Securities Ltd. | Retail Equity Research
Page 3
Exhibit 3: Domestic market share movement in motorcycles
19.6
50.4
6.8
14.7
18.0
51.3
7.0
13.815.7
50.7
6.6
17.8
0
10
20
30
40
50
60
70
Bajaj Auto Hero Motocorp TVS motor Honda
(%
)
Apr-16 Mar-17 Apr-17
Source: Company, ICICIdirect.com Research
Exhibit 4: Domestic market share movement in scooters/scooters
17.8
12.9
56.2
13.014.1 14.7
56.9
14.3
10.9
13.5
62.8
12.8
0
10
20
30
40
50
60
70
Hero Motocorp TVS Motors Honda Others
(%
)
Apr-16 Mar-17 Apr-17
Source: Siam, Data used is YTD
Overall motorcycle volumes grew 5.7% YoY in April 2017.
HMCL continues to be the market leader in the space with
share of ~51%
Overall scooter volumes grew 25.5% YoY in April 2017.
HMSI’s scooter segment grew 40.4% YoY, thereby gaining
market share, which was at 62.8%
ICICI Securities Ltd. | Retail Equity Research
Page 4
Exhibit 5: Market share movement in executive motorcycle (<125 cc) segment*
18.1
58.1
6.5
17.2
0
10
20
30
40
50
60
70
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(%
)
0
4
8
12
16
20
(%
)
Bajaj Auto (RHS) Hero Motocorp (LHS) TVS (RHS) HMSI (RHS)
Source: Siam * only top 4 two-wheeler OEMs
Exhibit 6: Market share movement in motorcycle greater than 125 cc segment
58.4
4.4
18.4
18.8
0
10
20
30
40
50
60
70
80
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(%
)
0
4
8
12
16
20
24
(%
)
Bajaj Auto (LHS) Hero Motocorp (RHS) TVS (RHS) HMSI (RHS)
Source: Siam *only top three vehicle two-wheeler OEMs
HMCL continues to dominate the executive motorcycle
segment (<=125 cc) in India with a market share of ~58%.
HMSI’s volumes have been more volatile thereby resulting in
wide fluctuation in its market share in eight to nine months
BAL continues to dominate the executive motorcycle
segment (<=125 cc) in India with market share of 58%.
HMSI’s market share recovered significantly to 18.8% largely
due to a recovery in volume of its ‘CB series’ in April 2017
ICICI Securities Ltd. | Retail Equity Research
Page 5
Hero MotoCorp (HERHON)
The market leader in the 2-W space, Hero MotoCorp’s (HMCL),
volumes declined 2.8% YoY to 595,618 units. However, the
management expects the ongoing marriage season to maintain
the trend of robust retail sales (double digit sales) in May 2017.
Volumes of motorcycle segment grew 0.7% YoY; as growth in
volumes of Splendor (0.9% YoY) & HF Deluxe (23% YoY) was
offset by de-growth (of 19% YoY) in Passion volumes. The scooter
volumes declined 24.1% YoY; as volumes of Maestro & Duet
declined 2.4% YoY & 63% YoY, respectively. However, the same
was partly offset by growth in volumes of Pleasure by 60% YoY
Export volumes declined 18.4% YoY to 9,963 units. HMCL has
raised vehicle prices (ASPs) in the range of | 500-2200 to partially
offset the commodity cost increase, from May 1, 2017
Exhibit 7: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
Motorcycles 530,325 526,735 0.7 536,672 -1.2 5,834,260 5,735,634 1.7
Scooters 65,293 86,004 -24.1 73,279 -10.9 829,786 896,208 -7.4
Total Sales 595,618 612,739 -2.8 609,951 -2.3 6,664,046 6,631,842 0.5
Export(inc. above) 9,963 12,214 -18.4 23,364 -57.4 177,536 210,239 -15.6
Exports (% of sales) 1.7 2.0 -32 bps 3.8 -216 bps 2.7 3.2 -51 bps
Source: Company, Siam
Bajaj Auto (BAAUTO)
Bajaj Auto’s (BAL) 2-W volumes grew 0.7% YoY, as a decline in
domestic volumes by 19.2% YoY was offset by the growth of 44%
in export. Pulsar volumes grew 5.8% YoY to 78,413 units. The
‘V15’ launched in March 2016 had received a good response in the
past. However, it has started to moderate (for April 2017 volumes
were at 10,053 units). Newly launched Dominar clocked volumes
of 2,649 units for April 2017. BAL expects combined volumes of
V12 (clocked volumes of 6,276 units in April 2017) & V15 at 35,000-
40,000 per month while Avenger (clocked 10,864 units in April
2017) is expected to clock volumes of ~50,000/quarter
Its 3-W volumes fell 5.6% YoY, as domestic volumes declined
37.9% YoY, which was partly offset by growth in export, up 61.9%
YoY. BAL’s exports markets like South Asia, Nepal and
Bangladesh are doing well while Nigeria is getting better & African
market has stabilised. The Sri Lankan market is still struggling
With > 5 million 3-W out in the market, BAL believes there is huge
opportunity in the 3-W electrification. The company is likely to
launch electric 3-W by 2020
Exhibit 8: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
Total 2-wheeler sales 293,932 291,898 0.7 244,235 20.3 3,219,932 3,358,252 -4.1
2W exports 132,002 91,465 44.3 92,786 42.3 1,218,541 1,457,933 -16.4
2W domestic sales 161,930 200,433 -19.2 151,449 6.9 2,001,391 1,900,319 5.3
Total 3-wheeler sales 35,868 37,999 -5.6 27,962 28.3 445,258 535,031 -16.8
3W exports 19,911 12,299 61.9 10,132 96.5 192,032 281,398 -31.8
3w domestic sales 15,957 25,700 -37.9 17,830 -10.5 253,226 253,633 -0.2
Total Sales 329,800 329,897 0.0 272,197 21.2 3,665,190 3,893,283 -5.9
Total Domestic Sales 177,887 226,133 -21.3 169,279 5.1 2,254,617 2,153,952 4.7
Total Exports 151,913 103,764 46.4 102,918 47.6 1,410,573 1,739,331 -18.9
Exports as % of sales 46.1 31.5 1461 bps 37.8 825 bps 38.5 44.7 -619 bps
Source: Company, Siam
Hero MotoCorp: Sales volumes
527
514
486
457 532
583
572
424
295
448
459 537
530
86
70
75
92 92
56
3539
65
73
65
63
84
0
100
200
300
400
500
600
700
Apr-
16
Jun-1
6
Aug-1
6
Oct-
16
Dec-1
6
Feb-1
7
Apr-
17
('000s)
0
10
20
30
40
50
60
70
80
90
100
('000s)
Motorcycles Scooters
Source: Siam, ICICIdirect.com Research
Bajaj Auto: Sales volumes
292
307
273
286
280 3
32
308
238
203
212
245 294
244
38 4
0
44 44
45
45
48
32
22 30
29
28
36
31
41
39 40
38
3233
43
47
44
42
46
38
0
50
100
150
200
250
300
350
400
450
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
Feb-17
Apr-17
('0
00s)
30
32
34
36
38
40
42
44
46
48
(%
)
Two-Wheelers Three-Wheelers % exports
Source: Siam, ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 6
TVS Motors (TVSSUZ)
TVS’ volumes (2-W+3-W) for April 2017 came in at ~2.5 lakh
units, up 8.5% YoY. The 2-W & 3-W volumes grew 8.4% YoY &
11.7% YoY in April 2017
Motorcycle segment volumes grew 10.4% YoY to 99,890 units.
Volumes of Apache grew 48.2% YoY to 39,942 units. Volumes of
Starcity 125 & Sport grew 52.1% YoY to 8373 units & 38% YoY to
24,683 units, respectively. Its scooter volumes grew 28.6% YoY to
81,443 units, mainly attributable to Pep+ (up 31.5% YoY to 9,570
units), Jupiter (up 33.8% YoY to 58,644 units) & Wego (up 27.9%
YoY to 8,124 units). Its moped (new TVS XL 100) volumes
declined by 12.9% YoY at 59,674 units mainly due to high base.
Export (15% of sales) volumes grew 27.1% YoY to 36,052 units,
supported by growth of 43.9% YoY in its 2-W exports
Exhibit 9: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
Motorcycles 99,890 90,491 10.4 95,671 4.4 1,075,248 1,016,807 5.7
Scooters 81,443 63,341 28.6 84,173 -3.2 870,863 813,277 7.1
Mopeds 59,674 68,518 -12.9 71,135 -16.1 910,519 738,547 23.3
Total 2-W Sales 241,007 222,350 8.4 250,979 -4.0 2,856,630 2,579,141 10.8
3-Wheelers 5,303 4,746 11.7 5,362 -1.1 69,254 110,821 -37.5
Total Sales 246,310 227,096 8.5 256,341 -3.9 2,925,884 2,689,962 8.8
Exports(incl. in above) 36,052 28,354 27.1 37,164 -3.0 422,536 454,550 -7.0
Exports as % of sales 15.0 12.8 14.8 14.8 17.6
Domestice sales 210,258 198,742 5.8 219,177 -4.1 2,503,348 2,235,412 12.0
Source: Company, Siam
Honda Motorcycles & Scooters India (HMSI)
For April 2017, HMSI’s volumes grew 34.3% YoY to 578,777 units.
This was after domestic scooter & motorcycle volumes grew
35.4% YoY & 15.2% YoY, respectively
The growth in domestic motorcycles can mainly be attributed to
strong volume growth of 51.2% YoY to 100,824 units. Apart from
that, volume of CB Unicorn grew 156.3% YoY to 20,659 units.
Domestic scooter volume grew 35.4% YoY, supported by growth
across its models. Volumes of Activa & Dio grew 33.6% YoY &
189.1% YoY to 312,632 & 43,948 units, respectively. HMSI’s Navi
has received a lukewarm response as it just managed to clock
volumes of ~63,000 since its launch in February 2016
Export volumes grew 58.7% YoY to 27,045 units, led by strong
growth in both motorcycle & scooter segment. Strong growth in
the export market increased its overall share by 72 bps YoY to
4.7% in April 2017
Exhibit 10: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
Motorcycles 183,182 158,956 15.2 84,638 116.4 1,557,557 1,538,255 1.3
Scooters 368,550 272,119 35.4 254,218 45.0 3,210,671 2,836,964 13.2
Total Sales 578,777 431,075 34.3 366,090 58.1 5,008,188 4,448,063 12.6
Exports(incl.above) 27,045 17,040 58.7 27,234 -0.7 283,151 200,141 41.5
Exports as % of sales 4.7 4.0 72 bps 7.4 -277 bps 5.7 4.5 115 bps
Domestice sales 551,732 414,035 33.3 338,856 62.8 4,725,077 4,247,922 11.2
Source: Company, Siam
TVS Motors: Sales volumes
90
96
95
95
114
123
122
68
58
60
58
96
100
63 65
68
68
77 8
5
92
73
56 71
69
84
81
69 7
6
77
77
77
80 9
0
78
66
72
78
71
60
25
75
125
175
225
275
325
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
Feb-17
Apr-17
(%
)
Motorcycles Scooters Mopeds
Source: Siam, ICICIdirect.com Research
HMSI: Motorcycles & scooter sales volumes
159
147
143
120
143
184
167
96
53
139
120
85
183
272
268
265
309 3
49 3
56
303
203
152
229
250
254
369
0
100
200
300
400
500
600
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
Feb-17
Apr-17
('0
00s)
Motorcycles Scooters
Source: Siam, ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 7
MSIL dominates PV segment
The overall passenger vehicles segment for April 2017 registered growth
of 14.4% YoY to 338,289 units. Domestic PV volumes increased 14.7%
YoY to 277,602 units while export volumes grew 13.2% YoY to 60,687
units. Within sub-segments of the PV space, utility vehicles (UVs)
continued to report good volume growth of 16.9% YoY. Volumes of
passenger cars also picked up, with the segment reporting growth of
15.4% YoY. On the flip side, vans registered de-growth of 7.5% YoY for
April 2107. Market leader MSIL continued to outperform the industry, with
volumes up 19.5% YoY to 151,215 units.
For April 2017, utility vehicle (UV) volumes were up 16.9% YoY at 83,999
units, supporting the overall PV market. The UV1 sub-segment grew
14.2% YoY to 62,570 units, driven by Maruti Suzuki’s Vitara Brezza, which
has done exceptionally well in a short period since its launch in March
2016, to climb to first position as the highest selling UV model in India. For
April 2017, Vitara Brezza clocked overall volumes of 10,653 units &
Hyundai’s Creta, which clocked volumes of 13,545 units. M&M’s TUV3OO,
which was launched in September 2015, has not helped the company to
capitalise on the UV1 space. For April 2017, volumes of TUV3OO grew
8.2% YoY to 2,086 units. Volumes in the UV2 space increased 7.2% YoY
to 16,784 units, supported by volume growth in Toyota (launched
refreshed Innova) volume grew 54.3% YoY to 6,589 units. Honda’s BR-V,
which is also classified in the UV2 space, received a modest consumer
response since its launch in May 2016 as till date it has clocked volumes of
~23,000 units.
The commercial vehicles volume declined 25% YoY to 45,552 units & was
mainly attributable to M&HCV volumes, which declined 50.9% YoY to
12,842 units. LCV volumes were also adversely impacted with volumes
down 5.4% YoY to 32,710 units. The MHCV/LCV volume ratio was at 28:72
in April 2017 vs. the average ratio 40:60 over the past 36 months.
Market share movement
According to Siam, the domestic market share for passenger vehicles (PV)
and commercial vehicles (CV) in April 2017 was as follows:
Exhibit 11: Domestic market share movement in passenger vehicles
48.4
17.5
5.1
9.4
0.9
18.9
47.4
16.7
5.7
7.8
0.8
21.6
51.9
16.1
5.1
7.0
0.3
19.6
0 10 20 30 40 50 60
Maruti
Hyundai
Tata Motors
M&M
GM
Others
(%)
Apr-16 Mar-17 Apr-17
Source: Siam, Data used is YTD * passenger vehicles as per Siam include Vans like Gio, Maxximo, Eeco, Ace
MSIL continues to dominate the PV segment & with
continued strong volume growth (outpacing the industry
growth) its market share is now at 51.9% in April 2017
ICICI Securities Ltd. | Retail Equity Research
Page 8
Exhibit 12: Market share movement in A2 segment
30.9
25.9
63.1
67.4
0
10
20
30
40
50
60
70
80
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(%
)
Hyundai Maruti
Source: Siam, Top two PV OEMs considered
Exhibit 13: Domestic market share movement in commercial vehicles
17.7
24.0
43.4
14.9
18.7
25.3
42.8
13.2
15.4
36.3 35.6
12.6
0
5
10
15
20
25
30
35
40
45
50
ALL M&M Tata Motors Others
(%
)
Apr-16 Mar-17 Apr-17
Source: Siam Data used is YTD
Exhibit 14: Segmental share in CVs
28.2
41.0
71.8
59.0
0
10
20
30
40
50
60
70
80
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(%
)
M&HCV LCV
Source: Siam
The A2 segment is the bread & butter category of the
passenger car segment. The segment has witnessed some
demand revival primarily supported by MSIL & TML
The M&HCV & LCV volumes declined 50.9% YoY & 5.4%
YoY in April 2017. Thus, overall CV volumes declined 25%
YoY. With the M&M product portfolio more tilted towards
LCV segment against Tata Motors (TML) & Ashok Leyland;
its market share expanded in April 2017
The MHCV/LCV ratio was at 28:72 in April 2017, mainly
after M&HCV volumes declined sharply by 50.9% YoY. The
average M&HCV volume (over the past 36 months) has
been ~40% of the total CV sales. It has been more than
four years when the MHCV/LCV ratio was at similar levels
of 28:72 in November 2012; being more biased towards
the LCV space
ICICI Securities Ltd. | Retail Equity Research
Page 9
Tata Motors (TELCO)
Tata Motors’ standalone volumes declined 21.4% YoY to 30,972
units after strong volume growth in its PV business was offset by
sharp volume de-growth in its CV business
Domestic M&HCV & LCV volumes declined 60% YoY & 15.6% YoY,
respectively. The domestic car segment was up 23.2% YoY to
11,220 units, mainly driven by Tiago, (clocked volumes of 4,115
units) & new Tigor, which clocked volume of 3,638 units. Its
domestic UV space grew 15.7% YoY to 1,607 units, driven by the
new Hexa (clocked volumes of 1,213 units)
JLR’s wholesale volumes grew 2.4% YoY at 41,923 units. Jaguar
volumes were up 37.2% YoY to 12,608 units, mainly driven by F-
Pace, which clocked volumes of ~5,000 units. Land Rover
volumes fell 7.7% YoY to 29,315 units, mainly impacted by decline
in volumes of Discovery. We believe North America & Chinese
market must have witnessed strong growth in April 2017
Exhibit 15: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
Domestic MHCV 4,653 11,642 -60.0 17,648 -73.6 148,901 156,961 -5.1
Domestic LCV 11,364 13,460 -15.6 18,228 -37.7 174,281 170,264 2.4
Domestic Pass.Car Sales 11,220 9,106 23.2 13,032 -13.9 136,184 107,808 26.3
Domestic UV 1,607 1,389 15.7 2,401 -33.1 18,758 18,613 0.8
Exports 2,128 3,785 -43.8 5,836 -63.5 64,199 58,068 10.6
Total Sales 30,972 39,382 -21.4 57,145 -45.8 542,323 510,997 6.1
Jaguar 12,608 9,188 37.2 20,492 -38.5 178,676 102,106 75.0
Landrover 29,315 31,745 -7.7 51,117 -42.7 421,934 441,979 -4.5
Total JLR Sales 41,923 40,933 2.4 71,609 -41.5 600,610 544,085 10.4
Source: Company, Siam
Maruti Suzuki India (MARUTI)
Maruti Suzuki’s (MSIL) volumes increased 19.5% YoY to 151,215
units. The LCV clocked volumes of 411 units in April 2017
Its domestic mini car segment grew 21.9% YoY, after domestic
volumes of Alto & Wagon R grew 35.9% YoY & 6.6% YoY to
22,549 units & 16,348 units, respectively. MSIL has discontinued to
production of DZire Tour. Its Baleno & Vitara Brezza has been well
accepted by customers registering domestic volumes of 17,530
units & 10,653 units, respectively. S-Cross has received a
lukewarm response, since its launch, with domestic volume for
April 2017 at 2,676 units
Export volumes declined 29% YoY, with its share at 4.4% of sales
Exhibit 16: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
Omni, Eeco,Versa 13,938 14,520 -4.0 11,628 19.9 152,009 143,471 6.0
Alto, Wagon-R, Zen, Swift,Ritz,
Celerio, Dzire,Baleno 102,481 77,606 32.1 91,672 11.8 998,831 974,928 2.5
SX4, Swift Dzire Tour, Ciaz 7,024 8,875 -20.9 6,084 15.5 97,060 92,536 4.9
Total Passengers 123,443 101,001 22.2 109,384 12.9 1,247,900 1,210,935 3.1
Gypsy, Vitara,Ertiga,Brezza 20,638 16,044 28.6 18,311 12.7 195,741 94,416 107.3
Total Domestic 144,081 117,045 23.1 127,695 12.8 1,443,641 1,305,351 10.6
LCV (Super Carry) 411 0 NA 304 NA 900 0 NA
Exports 6,723 9,524 (29.4) 11,764 -42.9 124,062 123,897 0.1
Total Sales 151,215 126,569 19.5 139,763 8.2 1,568,603 1,429,248 9.8
Exports as % of sales 4.4 7.5 8.4 7.9 8.7
Source: Company, Siam.
Maruti Suzuki India: sales volumes
123
99
137
132 149
134
136
118 1
44
130
140
151
127
7.5
4.4
0
20
40
60
80
100
120
140
160
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
Feb-17
Apr-17
('0
00s)
0
2
4
6
8
10
12
(%
)
Total Sales Export %
Source: Siam, ICICIdirect.com Research
Tata Motors: Domestic sales volume
28.6
31.2
31.6
29.3
29.2
33.7
36.1
25.8
29.8
33.2
33.4 41.4
18.0
10.8
8.8
12.6
13.9
13.8 15.0
16.8
13.1
11.1 13.2
14.1
15.7
12.9
0
10
20
30
40
50
60
70
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
Feb-17
Apr-17
(000's
)
CV Sales PV Sales
Source: Company, ICICIdirect.com Research
Jaguar Land Rover sales volume
43.9
47.4 51.8
40.9 46.2
47.2
42.3
52.9
53.1
48.7 5
4.6
71.6
41.9
0
20
40
60
80
100
Apr'1
6
May'1
6
June'1
6
July
'16
Aug'1
6
Sept'1
6
Oct'1
6
Nov'1
6
Dec'1
6
Jan'1
7
Feb'1
7
Mar'1
7
Apr'1
7
(%
share o
f total volu
mes)
10
20
30
40
50
60
70
80
(000's
)
% Jaguar % LR JLR total volumes(RHS)
Source: Company, ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 10
Ashok Leyland (ASHLEY)
Ashok Leyland’s (ALL) volumes declined 30.4% YoY to 7,090
units, as M&HCV volumes declined 42.4% YoY to 4,532 units. LCV
volumes grew by 10.6% YoY to 2,558 units
Volumes of M&HCV passenger declined 23.8% YoY to 1,286 units
while M&HCV goods volumes declined 47.5% YoY to 3,246 units
Exports grew 2.1% YoY, with overall share at 9.6% of sales. ALL
had ~10,664 unsold BS-III vehicles as of March 31, 2017, of which
(~2,000 units) will be exported. The remaining will be replaced
with BS-IV compliant engines, resulting in one-time additional cost
of | 20-30 crore
Mahindra and Mahindra (MAHMAH)
M&M’s overall automotive volumes declined 6% YoY to 39,357
units. Its core UV segment (including exports) declined 14.5% YoY
to 18,363 units. TUV3OO has not helped M&M, with volumes up
8.2% YoY to 2,086 units. KUV1OO volumes declined 58.5% YoY to
2,200 units. Volumes of XUV5OO also declined 29.1% YoY to
2,073 units
M&M’s tractor volumes grew 21.6% YoY to 26,001 units, post a
good harvest season, good progress in Rabi sowing and increased
MSPs. The domestic tractor industry volumes grew 19.3% YoY
54,917 units in April 2017 & grew 18% YoY (582,844 units) for
FY17
Exhibit 17: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
M&HCV Passenger 1,286 1,688 -23.8 2,372 -45.8 22,592 25,721 -12.2
M&HCV Goods 3,246
6,181 -47.5 12,886 -74.8 90,690 84,034 7.9
LCV 2,558 2,313 10.6 3,424 -25.3 31,774 30,603 3.8
Passenger Vehicles - 0 NA 0 NA - 97 -100.0
Total Sales 7,090 10,182 -30.4 18,682 -62.0 145,056 140,455 3.3
Exports 682 668 2.1 1,174 -41.9 11,792 13,133 -10.2
Exports as % of sales 9.6 6.6 6.3 8.1 9.4
Source: Company, Siam
Exhibit 18: Volume performance (in units)
Segment Apr-17 Apr-16 %chg Mar-17 %chg FY'17 FY16 %chg
UV’s 18,363 21,484 -14.5 23,827 -22.9 222,541 222,513 0.0
4-Wheeler pickups 14,360 11,834 21.3 20,334 -29.4 172,032 162,521 5.9
M & HCV 706 1,113 -36.6 2,574 -72.6 15,327 13,376 14.6
Total 4wheeler Sales 34,391 35,602 -3.4 48,260 -28.7 417,080 403,090 3.5
3-Wheeler 3,438 3,755 -8.4 5,062 -32.1 52,306 54,975 -4.9
Total Domestic Auto Sales 37,829 39,357 -3.9 53,322 -29.1 469,386 458,065 2.5
Exports 1,528 2,506 -39.0 2,709 -43.6 37,241 36,033 3.4
Total Auto Sales 39,357 41,863 -6.0 56,031 -29.8 506,627 494,098 2.5
Exports as % of sales 3.9 6.0 4.8 7.4 7.3
Tractors - Domestic 25,081 20,704 21.1 17,973 39.5 248,409 202,046 22.9
- Exports 920 682 34.9 1,364 -32.6 14,583 11,545 26.3
Total Tractors 26,001 21,386 21.6 19,337 34.5 262,992 213,591 23.1
Exports as % of sales 3.5 3.2 7.1 5.5 5.4
Source: Company, Siam
Mahindra and Mahindra: Sales volume
41.9
40.7
39.0
39.5
40.6 4
6.1 5
2.0
32.5 36.4
39.3 42.7
56.0
39.4
0
10
20
30
40
50
60
70
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(000's
)
Source: SIAM, ICICIdirect.com Research
Mahindra and Mahindra: Tractor sales
21.4
23.0
30.2
17.6
13.5
30.6
45.2
17.3
14.0
15.9
15.0
19.3
26.0
0
5
10
15
20
25
30
35
40
45
50
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(000's
)
Source: SIAM, ICICIdirect.com Research
Ashok Leyland: Total sales
7.9
7.5 8.7
8.2
8.2 9.0
9.6
6.9 8
.8
12.1
11.3
15.3
4.5
2.3
2.4
2.4
2.3
2.7 3
.1 3.0
2.6
1.9
2.8
2.7
3.4
2.6
0
2
4
6
8
10
12
14
16
18
20
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
Apr-17
(000's
)
M&HCV LCV
Source: Siam, ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 11
Top domestic model wise volumes for April 2017
Exhibit 19: Top 10 passenger vehicle – Models sold in India (in units)
S.No. Models Apr-16 Models Apr-17
1 Alto 16,583 Swift 23,802
2 Swift 15,661 Alto 22,549
3 Wagon R 15,323 Baleno 17,530
4 DZIRE TOUR 13,256 Wagon R 16,348
5 Elite i20 11,147 Elite i20 12,668
6 Grand i10 9,840 Grand i10 12,001
7 Kwid 9,795 VITARA BREZZA 10,653
8 Baleno 9,562 Creta 9,213
9 Celerio 8,548 DZIRE TOUR 8,606
10 Omni 8,356 Celerio 8,425
Source: Siam
Exhibit 20: Top 10 two-wheelers – Models sold in India (in units)
S.No. Models Apr-16 Models Apr-17
1 Activa 233,935 Activa 312,632
2 Splendor 224,238 Splendor 226,681
3 HF Deluxe 116,567 HF Deluxe 143,794
4 Passion 98,976 CB Shine 100,824
5 TVS XL Super 67,045 Passion 80,053
6 Glamour 66,756 Glamour 62,713
7 CB Shine 66,691 Jupiter 58,527
8 CT 66,409 TVS XL Super 57,938
9 Pulsar 50,419 Pulsar 50,219
10 Jupiter 43,256 CT 45,003
Source: Siam
ICICI Securities Ltd. | Retail Equity Research
Page 12
State wise sales mix for Q3FY17 (October – December 2016)
Exhibit 21: Top 10 state wise PV volume for Q3FY17 (in units)
64338
59605
54653
49862
47031
44288
39850
38168
31475
105628
0
20000
40000
60000
80000
100000
120000
Maharashtra
Guja
rat
U.P
.
Karnataka
Kerala
Tam
il N
adu
Delh
i
Haryana
Raja
sthan
Tela
ngana
Passenger Vehicles (PVs) Sales
Source: Siam
Exhibit 22: Top 10 state wise 2-W volume for Q3FY17 (in units)
438,0
30
346,5
84
268,1
57
256,4
06
255,6
87
233,5
57
213,1
29
185,7
06
155,5
27
497,1
90
0
100,000
200,000
300,000
400,000
500,000
600,000
U.P
.
Maharashtra
Tam
il N
adu
Raja
sthan
Karnataka
Guja
rat
Andhra
pradesh
Madhya
Pradesh
West
Bengal
Bih
ar
2-W Sales
Source: Siam
State wise market share of PV for Q3FY17
Maharashtra
21%
Gujarat
9%
U.P.
8%
Karnataka
7%
Kerala
7%
Tamil Nadu
6%
Delhi
6%
Haryana
5%
Rajasthan
5%
Others
33%
Source: Siam, ICICIdirect.com Research
State wise market share of 2-W for Q3FY17
U.P.
12%
Maharashtra
11%
Tamil Nadu
9%
Rajasthan
7%
Karnataka
7%
Gujarat
7%
Andhra pradesh
6%
Madhya
Pradesh
5%
West Bengal
5%
Others
31%
Source: Siam, ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 13
State wise sales mix for Q3FY17 (October – December 2016)
Exhibit 23: Top 10 state wise CV volume for Q3FY17 (in units)
14,2
15
11,7
37
11,7
08
10,7
34
9,9
52
9,8
56
8,8
83
7,7
53
7,3
19
25,4
51
0
5,000
10,000
15,000
20,000
25,000
30,000
Maharashtra
U.P
.
Tam
il N
adu
Guja
rat
Raja
sthan
Andhra
pradesh
Karnataka
West
Bengal
Madhya
Pradesh
Haryana
CV Sales
Source: Siam
Exhibit 24: Top 10 state wise 3-W volume for Q3FY17 (in units)
11625
11052
9207
8904
8529
7682
7679
6465
5374
14204
0
2000
4000
6000
8000
10000
12000
14000
16000
Guja
rat
Andhra
pradesh
Maharashtra
Bih
ar
U.P
.
Karnataka
Tam
il N
adu
Tela
ngana
Kerala
Oris
sa
3-W Sales
Source: Siam
State wise market share of CV for Q3FY17
Maharashtra
15%
U.P.
9%
Tamil Nadu
7%
Gujarat
7%
Rajasthan
7%
Andhra pradesh
6%
Karnataka
6%
West Bengal
5%
Madhya
Pradesh
5%
Others
33%
Source: Siam, ICICIdirect.com Research
State wise market share of 3-W for Q3FY17
Gujarat
12%
Andhra pradesh
10%
Maharashtra
9%
Bihar
8%
U.P.
8%
Karnataka
7%
Tamil Nadu
7%
Telangana
7%
Kerala
5%
Others
27%
Source: Siam, ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 14
News & views
GST to have neutral to positive impact on auto industry!
We believe GST will have a neutral to positive impact on the overall auto &
auto ancillary space. The effective higher tax rate will largely be passed on
to consumers as OEMs are likely to hike vehicle prices (ASPs). The shift of
the market from the unorganised to the organised ones will actually be
positive for most auto ancillary players, which currently face stiff
competition from unbranded/local players (which skip their tax liability) vs.
organised ones. The transition (from current tax regime to GST)
clarification is still awaited (by the industry) from the government, which
will actually have an impact on the outstanding inventory at the dealer
levels. The following table explains the segment wise current tax bracket.
The expected tax rate after GST implementation and its impact on various
segments is as follows:
Exhibit 25: Impact of GST on various Auto segments
Segment Tax rate
earlier
GST Rate View Impact
2-W 24.3 28.0
The price of 2-Ws<350 cc will increase marginally by 0.5%. Given that there is a
cess of 3% on motorcycles>350cc, the price increase post GST will by 2.6%.
However, motorcycle above 350 cc contributes only 0.4% of the domestic 2-W sales
Neutral
Small car/SUV (Length<4 m; engine
size<1200 cc/1500 cc for petrol/diesel
vehicles)
24.3 28.0
Although the gap between current tax incidence & GST appears optically high,
prices of these vehicles will increase in the range of ~1-3% post GST
implementation, because the base (ex-showroom price) will also change with GST
implementation. This potential price increase will not have an impact on demand
Neutral
Sedan/SUV (length> 4 m;engine size< 1500
cc)
32.3 43.0
Prices of these vehicles will increase ~6%. Prices of cars like Ciaz & Ertiga fall in
this segment, which form ~9% of Maruti's domestic sales
Negative
Sedan/SUV (length> 4 m with engine
size>1500 cc)
35.9 43.0
Prices of these vehicles will increase ~0.5%. There will not be an negative impact
on demand due to the potential price rise
Neutral
CV 24.3 28.0 Prices of these vehicles will increase ~0.5%. Hence, the impact will be neutral Neutral
Tractors 11.9 12.0 Prices of tractors will reduce ~1% Neutral
Source: cbec.gov.in, Company, ICICIdirect.com Research;
ICICI Securities Ltd. | Retail Equity Research
Page 15
ICICIdirect.com Research Universe (Auto & Auto ancillary)
CMP M Cap
(|) TP(|) Rating (| Cr) FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E
Amara Raja (AMARAJ) 836 930 Hold 14280 28.5 29.4 37.3 29.3 28.4 22.4 18.1 17.1 13.7 31.2 26.2 27.9 23.2 20.1 21.2
Apollo Tyre (APOTYR) 223 280 Buy 11246 21.7 21.8 19.7 10.3 10.2 11.3 6.5 7.9 8.6 19.9 13.6 11.0 17.1 15.0 12.2
Ashok Leyland (ASHLEY) 83 100 Buy 23363 2.5 4.0 4.8 32.6 20.7 17.2 11.8 11.6 9.6 22.8 20.8 22.6 17.4 17.4 18.8
Bajaj Auto (BAAUTO) 2770 3000 Hold 80155 126.8 132.3 155.4 23.4 22.5 19.1 17.5 18.0 15.0 42.2 30.5 33.5 29.9 22.4 24.0
Balkrishna Ind. (BALIND) 1476 1400 Buy 14269 58.7 77.0 83.8 20.1 15.3 14.1 11.2 9.6 7.6 20.4 22.5 24.7 20.3 22.5 24.7
Bharat Forge (BHAFOR) 1092 1150 Buy 25449 28.0 30.5 44.6 39.0 35.8 24.5 17.6 17.9 13.4 16.5 14.8 19.5 18.3 17.4 21.5
Bosch (MICO) 22978 25250 Buy 72151 410.2 567.0 566.2 55.2 40.0 40.0 36.0 37.5 26.1 15.1 15.8 15.8 22.5 21.4 25.3
Eicher Motors (EICMOT) 27460 30500 Buy 74169 655.9 833.2 1019.4 41.9 33.0 26.9 24.8 18.4 14.7 39.2 41.1 39.1 36.0 33.6 30.9
Exide Industries (EXIIND) 229 270 Buy 19435 7.3 8.2 9.4 31.2 28.0 24.2 19.0 17.7 14.4 19.4 18.7 20.4 14.0 14.1 14.8
Hero Mototcorp (HERHON) 3566 3975 Buy 71210 156.9 169.1 199.6 22.7 21.1 17.9 15.2 14.3 11.9 53.6 43.5 49.0 39.4 33.0 36.3
JK Tyre & Ind (JKIND) 166 215 Buy 3773 21.0 16.6 18.1 7.9 10.1 9.2 5.8 8.1 6.5 20.1 11.2 11.8 29.1 15.8 18.2
Mahindra CIE (MAHAUT) 241 280 Buy 7770 4.5 10.3 13.5 53.8 23.3 17.8 16.8 11.5 9.1 5.4 10.8 12.6 6.9 11.1 13.2
Maruti Suzuki (MARUTI) 6865 7200 Buy 207463 151.3 242.9 280.1 45.4 28.3 24.5 21.4 18.6 15.8 23.9 26.3 26.5 16.9 20.3 20.4
Motherson (MOTSUM) 427 450 Hold 59909 11.1 16.7 22.9 38.5 25.5 18.6 15.1 10.5 7.8 16.0 22.2 28.4 19.6 23.1 25.0
Wabco India (WABTVS) 5825 7000 Buy 11067 107.7 118.6 158.4 54.1 49.1 36.8 37.9 32.4 24.8 19.4 17.8 19.4 25.5 24.5 26.8
Sector / Company
RoE (%)EPS (|) P/E (x) EV/EBITDA (x) RoCE (%)
Source: ICICIdirect.com Research
ICICI Securities Ltd. | Retail Equity Research
Page 16
Exhibit 26: Auto raw material index
RM Auto Index
103
77
96
70
80
90
100
110
May-12
Jul-12
Sep-12
Nov-12
Jan-13
Mar-13
May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Jan-15
Mar-15
May-15
Jul-15
Sep-15
Nov-15
Jan-16
Mar-16
May-16
Jul-16
Sep-16
Nov-16
Jan-17
Mar-17
May-17
Source: Bloomberg, Reuters, Company, ICICIdirect.com Research
Exhibit 27: Currency movements
70
80
90
100
110
120
130
140
150
160
170
Nov-12
Feb-13
May-13
Aug-13
Nov-13
Feb-14
May-14
Aug-14
Nov-14
Feb-15
May-15
Aug-15
Nov-15
Feb-16
May-16
Aug-16
Nov-16
Feb-17
May-17
US$INR US$JPY US$EUR
Volatility in the currency markets is impacting raw material prices for companies with imported
components and lower natural hedges.
Source: Company, ICICIdirect.com Research
The in-house raw material index reflects the combination of
various input materials (steel, rubber, aluminium, plastics)
for OEMs, which have April 2012 as base year at 100. The
chart had showed a declining trend in the past. However,
prices have started moving northwards over the past one
year, indicating that the benefit of lower input cost has
peaked out
ICICI Securities Ltd. | Retail Equity Research
Page 17
RATING RATIONALE
ICICIdirect.com endeavours to provide objective opinions and recommendations. ICICIdirect.com assigns
ratings to its stocks according to their notional target price vs. current market price and then categorises them
as Strong Buy, Buy, Hold and Sell. The performance horizon is two years unless specified and the notional
target price is defined as the analysts' valuation for a stock.
Sector view:
Over weight compared to index
Equal weight compared to index
Under weight compared to index
Index here refers to BSE 500
Pankaj Pandey Head – Research [email protected]
ICICIdirect.com Research Desk,
ICICI Securities Limited,
1st Floor, Akruti Trade Centre,
Road No 7, MIDC,
Andheri (East)
Mumbai – 400 093
ICICI Securities Ltd. | Retail Equity Research
Page 18
ANALYST CERTIFICATION
We /I, Nishit Zota, MBA (Finance) and Vidrum Mehta, MBA (Finance) Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research
report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s)
or view(s) in this report.
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ICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India. We and our associates might have investment banking
and other business relationship with a significant percentage of companies covered by our Investment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts
and their relatives from maintaining a financial interest in the securities or derivatives of any companies that the analysts cover.
The information and opinions in this report have been prepared by ICICI Securities and are subject to change without any notice. The report and information contained herein is strictly confidential and
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temporarily and such suspension is in compliance with applicable regulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this
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in the past twelve months.
ICICI Securities or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from the date of this report for services in
respect of managing or co-managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.
ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the companies mentioned
in the report in the past twelve months.
ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its associates or its analysts did not receive any
compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts
and their relatives have any material conflict of interest at the time of publication of this report.
It is confirmed that Nishit Zota, MBA (Finance) and Vidrum Mehta, MBA (Finance) Research Analysts of this report have not received any compensation from the companies mentioned in the report in the
preceding twelve months.
Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.
ICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the Company mentioned in the report as of the last day of the month
preceding the publication of the research report.
Since associates of ICICI Securities are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject
company/companies mentioned in this report.
It is confirmed that Nishit Zota, MBA (Finance) and Vidrum Mehta, MBA (Finance) Research Analysts do not serve as an officer, director or employee of the companies mentioned in the report.
ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.
Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned in the report.
We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysis activities.
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publication, availability or use would be contrary to law, regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securities
described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and
to observe such restriction.
This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution,
publication, availability or use would be contrary to law, regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securities
described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and
to observe such restriction.
ICICI Securities Ltd. has received an investment banking mandate from Mahindra Life Space Developers Ltd, which is an associate of Mahindra & Mahindra Ltd. This report is prepared based on publicly
available information."