1QFY2017 Result Update | Infrastructure

September 15, 2016

IL&FS Transportation Networks (ITNL)

NEUTRAL

CMP

`91

Performance Highlights

Target Price

Quarterly highlights - Consolidated

Investment Period

Y/E March (` cr)

1QFY17

1QFY16

% chg (yoy)

Net sales

937

905

3.6

Stock Info

EBITDA

(47.0)

Reported PAT

(19)

nmf

Sector

Infrastructure

Source: Company, Angel Research; nmf- Not Meaningful

Market Cap (` cr)

3,008

IL&FS Transportation Networks (ITNL) in 1QFY2017 has not reported consol.

Net debt (` cr)

26,768

numbers as it is in process of migrating to Ind-AS. Despite strong execution,

Beta

0.8

sharp decline in yoy Fee and O&M income led ITNL report 3.6% increase in

52 Week High / Low

102/64

standalone revenues. High contribution of low margin construction business was

Avg. Daily Volume

973,974

seen during in 1QFY2017 (construction/ material expenses reported 19.5/11%

yoy increase). As a result, yoy EBITDA margins contracted 302bps to 3.2%.

Face Value (`)

Despite 47% yoy EBITDA decline, reported PAT turned-around on yoy basis to

BSE Sensex

28,372

`18cr profit in 1QFY2017, owing to strong other income (up 75.9% yoy to

Nifty

8,727

`344cr). Other income benefitted from `102cr of profit booked from 15% stake

Reuters Code

ILFT.BO

sale in Gujarat Road & Infrastructure Company Ltd. (GRICL).

Bloomberg Code

ILFT@IN

ITNL reported order backlog of `13,758cr at 1QFY2017-end, which gives

construction segment revenue visibility for 36+ months. Consolidated debt in our

Shareholding Pattern (%)

view stood at `28,650cr, reflecting D/E of 4.4x. ITNL’s equity requirement

towards BOT projects for FY2017-18E stands at ~`673cr. 3 BOT projects are to

Promoters

73.2

report Date of Completion (CoD) in next few months, in-turn contributing

MF / Banks / Indian Fls

0.7

FY2017-18E Toll/ Annuity Income.

FII / NRIs / OCBs

7.2

Outlook and Valuation: In recent time we have seen management offloading

Indian Public / Others

18.9

stake in 2 operational BOT projects. ITNL management announced that they

intend to offload 3-4 BOT projects, worth `5,000cr in to an Infrastructure

Abs. (%)

1yr

3yr

Investment Trust (InvIT). As per a recent board meeting outcome, ITNL would

Sensex

7.0

9.3

43.7

issue `5,000cr of Non-Convertible Debentures (NCDs), where current 12% debt

cost would be re-financed sub-10% levels, thereby saving ~300bps on interest

ITNL

20.0

(4.1)

(12.8)

expenses level. All these initiatives would de-leverage Balance sheet and improve

the profitability. We earlier upgraded ITNL to BUY with price target of `93, in

3-Year Daily Price Chart

anticipation of lowering of consol. BS stress and likely improvement in interest

300

coverage ratio. Since our BUY recommendation, ITNL stock has run-up and our

250

price target is attained. In absence of ITNL’s consolidated financials, we

200

downgrade to NEUTRAL view on the stock.

150

Key financials (Consolidated)

100

Y/E March (` cr)

FY14

FY15

FY16

FY17E

FY18E

Net Sales

6,587

6,304

7,947

8,946

10,017

% chg

(0.9)

(4.3)

26.1

12.6

12.0

Net Profit

463

444

232

266

299

% chg

(11.0)

(4.2)

(47.7)

14.5

12.6

EBITDA (%)

28.7

30.8

31.0

31.6

EPS (Rs)

Source: Company, Angel Research

P/E (x)

4.9

6.4

13.0

11.3

10.1

P/BV (x)

0.5

0.4

RoE (%)

10.6

7.5

4.3

4.2

5.0

RoCE (%)

8.3

6.7

6.8

7.2

Yellapu Santosh

EV/Sales (x)

3.1

3.9

3.7

3.4

022 - 3935 7800 Ext: 6828

EV/EBITDA (x)

10.8

12.8

12.2

11.8

10.7

[email protected]

Source: Company, Angel Research; CMP as of 14 Sep, 2016

Please refer to important disclosures at the end of this report

ITNL | 1QFY2017 Result Update

Exhibit 1: Quarterly Performance (Standalone)

Particulars (` cr)

1QFY17

1QFY16

% chg (yoy)

Net Sales

937

905

3.6

Total Expenditure

908

849

6.9

Cost of materials consumed

11.0

Construction Contract Cost

780

653

19.5

Employee benefits Expense

23.8

Other Expenses

172

(42.4)

EBITDA

(47.0)

EBIDTA %

3.2

6.2

Depreciation

(6.6)

EBIT

(48.9)

Interest and Financial Charges

331

281

17.9

Other Income

344

196

75.9

PBT before Exceptional Items

(32)

nmf

Exceptional Items

PBT after Exceptional Items

(32)

nmf

Tax Expenses/ (credit) (note)

(13)

nmf

% of PBT

55.5

41.6

PAT

(19)

nmf

PAT %

1.9

(2.1)

Comprehensive Income

nmf

Total Comprehensive Income

(18)

nmf

Dil. EPS

0.54

(0.76)

nmf

Source: Company, Angel Research; Note: nmf- Not meaningful;*Reported as per Ind AS, FY2016

numbers & other remaining quarters continue to be reported as per Indian GAAP; It needs to be

noted that yoy growth for FY2017E is not comparable as FY2016 continues to be reported under

Indian GAAP

Update on Consolidated business

ITNL in 1QFY2017 has not reported consolidated numbers as it is in the process of

migrating to Ind-AS (Accounting Standards). Management indicated that it would

report consolidated numbers from 4QFY2017E onwards.

Update on Standalone business

Despite strong execution, low Fee income restricts yoy sales growth

ITNL reported standalone numbers which are in compliance with the new Ind-AS.

Weak Fee income led ITNL report just 3.6% yoy increase in revenues to `937cr.

Reported 1QFY2017 revenues are below our estimate. Construction income grew

22.1% yoy to `884cr, with revenues booked from CNTL, KSEL, RMGSL and BAEL

projects.

ITNL reported sharp yoy decline in fee income to `18cr (vs `156cr in 1QFY2016).

Higher O&M income was seen in 1QFY2016 on a/c of overlaying activities. In

absence of such works in 1QFY2017, ITNL witnessed sharp fall in O&M income.

September 15, 2016

ITNL | 1QFY2017 Result Update

EBITDA margins decline to 3.2%

Shift in revenue mix, where high contribution of low margin Construction business

was seen during the quarter, led to 302bp yoy EBITDA margin contraction to 3.2%.

EBITDA margin contraction on yoy basis was owing to 19.5% rise in construction

contract expenses (to `780cr), and 11% increase in material expenses (to `15cr).

Increase in yoy construction expenses is owing to ongoing works at BAEL, CNTL

and RMGSL, amongst other project.

High other income led to yoy PAT turn-around

Despite 47.0% yoy EBITDA decline, PAT turned-around on yoy basis from `19cr

loss in 1QFY2016 to `18cr profit in 1QFY2017, owing to strong other income (up

75.9% yoy to `344cr). ITNL reported PAT margins of 1.9% in 1QFY2017 (vs. 2.1%

loss margins in 1QFY2016). Other income in 1QFY2017 benefitted from `102cr

of profit booked from 15% stake sale in Gujarat Road & Infrastructure Company

Ltd. (GRICL), an operational BOT road project. Increase in yoy Loans & Advances

(at ~`3,200cr) also contributed to higher other income numbers in 1QFY2017.

Notably, interest expenses of ITNL increased 17.9% yoy to `331cr, reflecting

increase in standalone debt. Standalone debt increased 15.5% yoy from `8,052cr

in 1QFY2016 to `9,296cr in 1QFY2017.

Strong Order backlog of `13,758cr gives better revenue visibility

ITNL at 1QFY2017-end reported order backlog of

`13,758cr, which gives

Construction segment revenue visibility for over 36+ months.

Exhibit 2: Order Book stands at `13,758cr

Exhibit 3: Order Book Split at 1QFY2017-end...

18,000

(` in cr)

Non-Road

16,000

Projects, 7%

14,000

12,000

10,000

8,000

Non-NHAI

6,000

Road , 35%

4,000

NHAI, 59%

2,000

Source: Company, Angel Research

ITNL to-date has reported 6 Infrastructure project wins since FY2016 beginning.

Details of these projects are as follows:

4-laning of 141km stretch between Fagne-Gujarat/ Maharashtra Border

(Package-III, NH-6) on BOT (Toll) basis.

4-laning of 194km stretch between Amravati-Chikhli (Package-I, NH-6) on

BOT (Toll) basis.

6-laning of 23.5km stretch between Ranchi Ring Road, section VII from

Kathitanr to Karma on BOT basis.

September 15, 2016

ITNL | 1QFY2017 Result Update

Upgrade 2 road projects, (i) Bandri-Jaruwakheda, Nirtala-Mandi-Bamora and

Damoh-Hindoriya-Patera section covering 76.2km, (ii) Pachawali-Rannod,

Rannod-Pichhore, Bhasula-Chainpur, Vijaypur-Dhanrawad and Ashok Nagar-

Thubon section on performance based contract.

Development of Commercial Area and Automated Car Park of approx. 1200

car spaces on DBFOT Basis including right to collect revenue from the project

for a period of 30 years in the Middle East.

Ethiopian Roads Authority has awarded ITNL and Elsamex (a wholly owned

subsidiary of ITNL) joint venture Design, Improvement Works and

Management and Maintenance Services of (i) Nekempte-AngerGutin-Andhode

Road Section (86.1km), (ii) Agamsa-Bure Road Section (84.6km) on an Output

and Performance Based Road Contract (OPRC) for approx. contract value of

`1,524.7cr. This project is for a period of 8 years.

ITNL indicated healthy bid-pipeline of ~`45,990cr, with a major ~`30,768cr of it

being at RFP stage. Notably, ~29% of bid pipeline highlighted is from NHAI.

Exhibit 4: 1QFY2017 Bid Pipeline details

Particular (` cr)

RFP Stage

RFQ Stage

NHAI Projects

5,990

7,523

State Highway Projects

14,212

6,264

MoRTH Projects

9,090

NHAI EPC Projects

Metro Transportation Corp. Project

1,476

1,435

Total Bid Pipeline

30,768

15,222

Source: Company, Angel Research

Update on per day income of the BOT Projects

Cumulative Toll income (on per day basis) of the road projects portfolio, reported

16.6% yoy increase in per day Toll income to `5.4cr. Notably 4 of them reported

impressive yoy growth, inclusive of, (1) 41.6% increase in per day toll income at

RIDCOR-Mega Highway project (to avg. per day toll of `0.98cr),

(2)

14.1%

increase in Baleshwar Kharagpur BOT project (to avg. per day toll of `0.17cr), (3)

38.9% yoy increase in Pune Solapur BOT project (to avg. per day toll of `0.30cr)

and (4) 22.7% yoy increase in Barwa Adda BOT project (to avg. per day toll of

`0.20cr). These 4 BOT-Toll projects together contributed 30% of total 1QFY2017

toll income.

1QFY2017 Annuity income per day benefitted from contribution of JSEL BOT

project on yoy basis.

September 15, 2016

ITNL | 1QFY2017 Result Update

Financial Health of the company

Management highlighted that ITNL has ended the quarter with similar debt levels

as it was in the previous quarter. Considering the 3.4% qoq increase in 1QFY2017

standalone debt (to `9,296cr), we expect consol. debt to be at `28,650cr,

reflecting consol. D/E ratio of 4.4x.

Exhibit 5: Consolidated Debt & D/E Ratio

35,000

4.6

4.5

30,000

4.4

25,000

4.2

4.3

20,000

4.1

4.2

4.1

15,000

4.0

4.1

4.0

10,000

3.9

5,000

3.8

3.7

4QFY15

1QFY16

2QFY16

3QFY16

4QFY16

1QFY17

Debt (` cr)

D/E (x)

Source: Company, Angel Research

As of 1QFY2017-end, ITNL management in concall highlighted that they require

`1,007cr as equity investment towards BOT projects (to-date equity invested in

BOT project stands at ~`5,300cr). Of the required `1,007cr equity, `454cr is to

be deployed in remaining 3 quarters of FY2017E and `219cr in FY2018E, and the

balance `334cr thereafter in FY2019-21E.

Projects Schedule

ITNL’s Management highlighted that additional equity requirement of existing BOT

projects are to the tune of ~`1,007cr (majorly to be invested in next few years).

3 of the ongoing BOT projects are expected to get Date of Completion (CoD) in

next few months, thereby adding to Toll/ Annuity income in FY2017E.

Exhibit 6: BOT Projects Scheduled CoD

BOT Projects

Scheduled CoD

BAEL

Oct-2016

KSEL

Oct-2016

CNTL

Oct-2016

KNC

Feb-2018

Jharkhand Road stretches

Aug-2018

SSTL

Apr-2020

Source: Company, Angel Research

Owing to the recent emergence of land acquisition issues (land owners are now

demanding higher compensation for already sold land) at KNC, management has

revised the scheduled CoD to Feb-2018.

September 15, 2016

ITNL | 1QFY2017 Result Update

Downgrade to Neutral as price target is achieved…

Despite ITNL’s robust order backlog and strong execution capabilities, we were

concerned about its higher consol. D/E ratio, which was eating into its profits. The

fund raising initiatives (rights issue), stake sale in 2 of the BOT projects, re-

financing of high cost debt with low cost (by issuing `1,300cr of Non-Convertible

Debentures), all these initiatives are in the right direction, to de-leverage the BS

and improve the profitability. ITNL management announced that they are in the

process of offloading 3-4 BOT projects worth `5,000cr in to an Infrastructure

Investment Trust (InvIT). Also, as per their board meeting outcome, ITNL would

issue `5,000cr of NCDs, where they intend to re-finance the high cost debt (of

12%) with low cost (at sub-10% levels), thereby saving ~200bps on interest

expenses.

We earlier upgraded the ITNL stock to BUY with price target of `93, in anticipation

of lowering of consol. BS stress and likely improvement in their interest coverage

ratio. Since our BUY recommendation, ITNL stock has run-up and our price target

is attained.

In absence of ITNL’s consolidated financials, we downgrade to NEUTRAL view

on the stock.

September 15, 2016

ITNL | 1QFY2017 Result Update

Exhibit 7: Derivation of SOTP-based target price for ITNL (FY2017E)

FY17E Std.

Target

Value/

% of

Particulars

Segment

Basis

EBITDA (` cr)

Multiple

Value (` cr)

share (`)

SoTP

ITNL's construction business

Construction

942

5.0

4,708

143

77.8

EV/EBITDA of 5x

Total

4,708

143

77.8

Discounted

Project

Adj. FCFE

Value/

% of

Particulars

Proj. Type

Basis

FCFE (` cr)

Stake

Value (` cr)

share (`)

SoTP

Road BOT projects

Noida Toll Bridge

Toll

728

26%

192

3.2

NPV at CoE of 14%

Gujarat Toll Roads

Toll

603

42%

253

4.2

NPV at CoE of 14%

West Gujarat Expressway

Toll

133

100%

133

2.2

NPV at CoE of 14%

RIDCOR Phase-I & II

Toll

1,249

50%

624

10.3

NPV at CoE of 14%

Beawar-Gomti

Toll

120

100%

120

2.0

NPV at CoE of 14%

Pune Sholapur

Toll

91%

0.8

NPV at CoE of 14%

Moradabad Bareilly

Toll

201

100%

201

3.3

NPV at CoE of 14%

Chandrapur Warora

Toll

118

35%

0.7

NPV at CoE of 14%

Narkatpally Addanki

Toll

613

50%

306

5.0

NPV at CoE of 14%

Kiratpur Ner-Chowk

Toll

1,185

100%

1,185

19.5

NPV at CoE of 14%

Sikar Bikaner

Toll

154

100%

154

2.5

NPV at CoE of 14%

Baleshwar Kharagpur

Toll

143

100%

143

2.4

NPV at CoE of 14%

North Karnataka Expressway

Annuity

311

100%

311

5.1

NPV at CoE of 14%

Thiruvananthapuram Phase - I & II

Annuity

375

100%

375

6.2

NPV at CoE of 14%

Hyderabad Ring Road

Annuity

123

26%

1.0

NPV at CoE of 14%

East Hyderabad Expressway

Annuity

74%

2.0

NPV at CoE of 14%

Hazaribagh Ranchi Expressway

Annuity

74%

2.5

NPV at CoE of 14%

Jharkhand roads Ph-I & II

Annuity

93%

21.2

NPV at CoE of 14%

Chenani Nashri

Annuity

625

100%

625

24.8

NPV at CoE of 14%

Jorabat Shillong

Annuity

172

50%

3.7

NPV at CoE of 14%

Total

7,243

5,110

155

83.7

Elsamax

272

1.5

408

6.7

Valued at 1.5x its BV

YuHe Expressway

Toll

191

1.5

286

4.7

Valued at 1.5x its BV

Vansh Nimay Infraprojects

1.0

0.2

Valued at 1.0x its BV

Metro Rail Gurgaon

FCFE

385

34%

130

2.1

Valued at 1.0x its BV

MP Entry Point project

110

51%

0.9

Valued at 1.0x its BV

Other Investments

1.0

1.6

Valued at 1.0x its BV

Net Debt- FY2016E

(7,713)

(234)

Standalone Net Debt

Grand Total

100.0

No. of shares

Upside

CMP

Source: Company, Angel Research

September 15, 2016

ITNL | 1QFY2017 Result Update

Investment arguments

Market leader in the growing BOT space: ITNL is a surface transport player, with

an established track record of successfully bidding, developing and operating road

BOT projects on a commercial basis. ITNL was one of the first movers in the road

development segment. The company bagged Noida Toll bridge project in 1998.

Since then, it has come a long way and has built sizeable portfolio currently. The

company has one of the largest BOT portfolios in India, encompassing 31 road

projects covering 14,699 lane kms spread across 16 states. Their 1QFY2017

order book at `13,758cr, gives construction segment revenue visibility for 36+ months.

Pan-India presence: ITNL has 31 BOT Road projects well spread across 16 states

in India. The company has decent exposure to state highways, which differentiates

it from peers. The one major advantage that state highway projects enjoy over

national highways is that they can be bundled with land, making the projects

viable. Such diversification strategy prevents the company from any fluctuation in

the revenue stream given its limited exposure to any one region or project.

Hedged revenue stream: We believe ITNL has a hedged road BOT asset portfolio

currently, as it is bifurcated into toll and annuity projects in revenue terms, thereby

reducing its dependence on traffic-related revenue inflow. Recent project win from

Kenyan BOT-Annuity project strengthens our view that going forward too, ITNL

would continue to have a balanced revenue mix of Annuity and Toll.

ITNL’s continues with its BS de-leveraging process: ITNL is currently sitting on a

consol. D/E ratio of 4.4x (reflecting debt of `28,650cr). It has sold 2 BOT projects,

re-financing high cost debt with low cost debt, currently is in process of coming-out

with an InvIT, 3 BOT projects would start operations in next few months, comfort us

that ITNL should see the benefits of its Balance Sheet de-leveraging process, going

forward.

Key concerns

Even though expectations are high for allocation towards Roads and Highways

vertical in the upcoming budget, any slowdown in the award activity from NHAI

could affect road-focused players such as ITNL.

ITNL has faced execution delays across few projects. Prolonged delays in project

execution beyond the time schedule could act as risk to our estimates.

BOT projects are inherently highly-levered projects. Hence, delays in the correction

of interest rates than our expectations could be a risk to our assumptions.

Management has highlighted plans to pursue strategic initiatives which should

materialize in the next few quarters. Any delays beyond that could act as a risk to

our estimates.

September 15, 2016

ITNL | 1QFY2017 Result Update

Profit & Loss Statement (Consolidated)

Y/E March (` cr)

FY14

FY15

FY16

FY17E

FY18E

Net Sales

6,587

6,304

7,947

8,946

10,017

% Chg

(0.9)

(4.3)

26.1

12.6

12.0

Total Expenditure

4,697

4,362

5,497

6,177

6,847

Cost of Materials Consumed

227

242

282

300

332

Construction Contract Cost

2,984

2,599

3,501

3,932

4,287

Employee benefits Expense

414

459

510

581

661

Other Expenses

1,072

1,063

1,203

1,364

1,568

EBITDA

1,890

1,941

2,451

2,769

3,169

% Chg

2.8

2.7

26.2

13.0

14.5

EBIDTA %

28.7

30.8

31.0

31.6

Depreciation

151

152

275

343

413

EBIT

1,739

1,789

2,175

2,426

2,757

% Chg

(0.3)

2.9

21.6

11.5

13.6

Interest and Financial Charges

1,471

1,833

2,531

2,796

2,859

Other Income

215

525

785

824

659

PBT

483

481

429

454

556

Tax

160

159

195

% of PBT

5.5

16.7

37.3

35.0

PAT before Extraordinary item

457

400

269

295

362

Extraordinary item

PAT before Minority Interest

457

400

269

295

362

Min Int. & Share of

(44)

Profit/ (Loss) of Associates

PAT after MI, profit share

463

444

232

266

299

from Assoc.

% Chg

(11.0)

(4.2)

(47.7)

14.5

12.6

PAT %

7.0

2.9

3.0

Diluted EPS

% Chg

(36.5)

(23.2)

(50.8)

14.5

12.6

Note: nmf- Not meaningful;*Reported as per Ind AS, FY2016 numbers & other remaining quarters

continue to be reported as per Indian GAAP; It needs to be noted that yoy growth for FY2017E is

not comparable as FY2016 continues to be reported under Indian GAAP

September 15, 2016

ITNL | 1QFY2017 Result Update

Balance Sheet (Consolidated)

Y/E March (` cr)

FY14

FY15

FY16

FY17E

FY18E

Sources of Funds

Equity Capital

571

623

705

Reserves Total

4,433

5,096

5,988

6,528

6,480

Networth

5,004

5,719

6,693

7,234

7,185

Minority Interest

459

291

474

521

588

Total Debt

18,817

23,513

27,643

30,223

31,423

Deferred Tax Liability

199

125

102

Total Liabilities

24,478

29,648

34,912

38,080

39,298

Application of Funds

Gross Block

14,282

17,393

21,593

24,503

25,793

Accumulated Depreciation

795

827

1,140

1,483

1,896

Net Block

13,487

16,566

20,453

23,020

23,897

Capital WIP

Investments

469

663

681

786

891

Goodwill

575

582

598

Current Assets

Inventories

Sundry Debtors

988

1,046

1,298

1,446

1,564

Cash and Bank Balance

671

939

875

461

370

Loans, Advances & Deposits

2,076

2,579

2,461

2,747

2,796

Other Current Asset

8,782

9,472

11,302

12,173

12,522

Current Liabilities

2,655

2,246

2,933

3,284

3,469

Net Current Assets

9,879

11,803

13,090

13,594

13,830

Deferred Tax Asset

Total Assets

24,478

29,648

34,912

38,080

39,298

September 15, 2016

ITNL | 1QFY2017 Result Update

Cash Flow Statement (Consolidated)

Y/E March (` cr)

FY14

FY15

FY16

FY17E FY18E

Profit before tax

483

481

429

454

556

Depreciation & Amortization Exp.

161

162

293

343

413

Other non-Cash Expenses

(119)

1,358

1,883

2,050

2,350

Change in Working Capital & Oth. Adj.

1,522

(754)

440

(1,651)

(1,553)

Cash Generated from Operations

2,048

1,246

3,045

1,196

1,766

Direct taxes paid

(251)

(178)

(261)

(285)

(225)

Net Cash Flow from Operations

1,797

1,068

2,784

911

1,541

(Inc)/ Dec in Fixed Assets

(3,196)

(2,848)

(3,970)

(2,900)

(1,290)

(Inc)/ Dec in Investments

(60)

(43)

(3)

(105)

(Inc)/ Dec in Other Investing Cash Flows

(868)

(723)

(725)

(811)

(878)

Cash Flow from Investing

(4,123)

(3,613)

(4,698)

(3,816)

(2,273)

Issue/ (Buy Back) of Equity

746

520

734

Inc./ (Dec.) in Loans

1,509

4,730

4,481

2,580

1,200

Dividend Paid (Incl. Tax)

(94)

(160)

(220)

(255)

(275)

Other Financing Cash Flows

276

(2,450)

(3,190)

150

(244)

Cash Flow from Financing

2,437

2,639

1,805

2,475

681

Inc./(Dec.) in Cash

111

(109)

(430)

(51)

Opening Cash balance & Oth. Adj.

500

596

700

591

161

Closing Cash balances

611

690

591

161

110

September 15, 2016

ITNL | 1QFY2017 Result Update

Key Ratios (Consolidated)

Y/E March

FY14

FY15

FY16

FY17E

FY18E

Valuation Ratio (x)

P/E (on FDEPS)

4.9

6.4

13.0

11.3

10.1

P/CEPS

3.7

4.1

5.5

4.7

3.9

Dividend yield (%)

2.7

2.4

2.1

2.5

EV/Sales

3.1

3.9

3.7

3.4

EV/EBITDA

10.8

12.8

12.2

11.8

10.7

EV / Total Assets

0.8

0.9

Per Share Data (`)

EPS (fully diluted)

18.7

14.3

7.1

8.1

9.1

Cash EPS

24.6

22.4

16.6

19.4

23.5

DPS

5.1

4.0

3.5

4.0

Book Value

203

232

203

220

218

Returns (%)

RoCE (Pre-tax)

8.3

6.7

6.8

7.2

Angel RoIC (Pre-tax)

7.3

6.1

6.3

6.5

7.1

RoE

10.6

7.5

4.3

4.2

5.0

Turnover ratios (x)

Asset Turnover (Gross Block) (x)

0.2

0.1

Inventory / Sales (days)

Receivables (days)

Payables (days)

119

Leverage Ratios (x)

D/E ratio (x)

3.8

4.1

4.2

4.4

Interest Coverage Ratio (x)

1.2

1.0

0.9

1.0

Note- nmf- Not meaningful

September 15, 2016

ITNL | 1QFY2017 Result Update

Research Team Tel: 022 - 39357800

E-mail: [email protected]

Website: www.angelbroking.com

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offering of securities of the company covered by Analyst during the past twelve months.

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contrary view, if any.

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Disclosure of Interest Statement

ITNL

1. Financial interest of research analyst or Angel or his Associate or his relative

2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives

3. Served as an officer, director or employee of the company covered under Research

4. Broking relationship with company covered under Research

Ratings (Based on expected returns

Buy (> 15%)

Accumulate (5% to 15%)

Neutral (-5 to 5%)

over 12 months investment period):

Reduce (-5% to -15%)

Sell (< -15)

September 15, 2016