Angel Top Picks - April 2016

Indian markets, rebounded strongly in the month of March, going up by more

FIIs turned bullish on the Indian markets

than 10%. The positive movement was fueled by growth oriented budget for

in a major fashion with net inflows of

`21,143cr in the month of March

FY2016-17. FIIs turned bullish on the Indian markets in a major fashion with net

inflows of `21,143cr in the month of March after being net sellers since

November 2015. Additionally, the markets gained in the latter half of the month

on expectation of a rate cut by the Reserve Bank of India (RBI) at its monetary

policy review.

Backed by a windfall gain on crude the government could deliver a pragmatic

Favorable trade balance helped

budget with focus on productive expenditure, emphasis on infrastructure and rural

narrowing down the current account

development rather than spending on subsidies. Favorable trade balance helped

deficit to 1.3% of GDP for 3QFY16

narrowing down the current account deficit to

1.3% of GDP for 3QFY16

compared to 1.5% in 3QFY15.

compared to 1.5% in 3QFY15. FDI inflows have also picked up substantially in

9MFY16 to $54bn compared to $45bn for entire FY15, indicating foreign

investors’ preference for India over other markets as an investment destination.

At 7.3% India has the highest GDP growth rate amongst the emerging markets

and is placed very attractively as an investment destination for foreign investors.

With the Indian government’s move to reduce rates on small savings instruments,

the overall interest rates in the economy are likely to come down, which will give a

fillip to corporate earnings. The earnings growth of Sensex has taken a hit in the

last two years as few companies with less than 30% weightage (mainly from the

metals and PSU space) in the index saw sharp declines in their profitability, while

the balance 70% of the companies continued to deliver decent results. Further,

during the current year the weightage of the underperforming companies has

With nominal GDP growth rate of

~12%, corporate earnings should grow

gone down to 20% and their earnings also seem to have bottomed out. The

by 15-16%.

above reason makes us believe that with nominal GDP growth rate of ~12%,

corporate earnings should grow by 15-16%. Inflows into the domestic mutual

funds have also been at record high levels. Lower interest rates offered on bank

deposits and small saving scheme make equities more attractive and we see

inflows into the Indian equity markets to be strong going ahead.

In line with our expectations the RBI has reduced the repo rate by 25bp to 6.5% in

Repo rate cut by 25bp to 6.5% in its

its first bi-monthly policy review of this fiscal and addressed the liquidity shortage

first bi-monthly policy review of this

witnessed by the bank. We believe that RBI has further room for rate cuts in the

fiscal

quarters to come. Lower interest rates will come as a relief for both consumers

and corporates. Interest rate sensitive sectors like auto, banks, housing finance

companies and select players in the infrastructures and real-estate space could

see improvement in volumes. Our top-picks in these sectors are LIC Housing

Finance, Dewan Housing Finance, Mahindra Lifespace, and IL&FS Transportation

Networks. Further we remain positive on consumption based stocks like Blue Star,

Radico Khaitan, Siyaram Silk Mills, etc.

Please refer to important disclosures at the end of this report

Top Picks Report | April 2016

Large Cap

EPS

PER

EV/Sales

ROE

Company

Sector

Rating

CMP (`) Target (`)

Upside (%) FY16E FY17E FY16E FY17E FY16E FY17E FY16E FY17E

Amara Raja

Auto Ancill.

Buy

887

1,040

17.2

28.8

37.1

30.8

23.9

3.1

2.5

23.4

24.1

BEL

Capital Goods

Buy

1,181

1,414

19.8

54.0

61.5

21.9

19.2

2.8

2.4

39.3

45.6

HCL Tech

Buy

844

1,038

22.9

51.1

57.7

16.5

14.6

2.3

1.9

21.5

18.8

HDFC Bank Financials

Buy

1,058

1,262

19.2

49.3

61.0

21.5

17.3

18.5

19.7

Infosys

Accumulate

1,219

1,347

10.5

59.4

65.7

20.5

18.5

3.9

3.3

21.2

20.1

LIC Housing Fin.Financials

Buy

468

592

26.6

33.0

40.2

14.2

11.6

19.7

20.5

NBCC

Construction

Buy

943

1,089

15.3

31.9

23.7

31.9

23.7

1.7

1.3

24.1

26.7

Source: Angel Research

Mid Cap

EPS

PER

EV/Sales

ROE

Company

Sector

Rating

CMP (`) Target (`) Upside (%) FY16E FY17E FY16E FY17E FY16E FY17E FY16E FY17E

Blue Star

Cons. Durable

Buy

393

458

16.8

13.7

17.2

28.7

22.9

1.1

0.9

26.1

25.4

Dewan Housing Financials

Buy

189

270

43.0

25.9

30.8

7.3

6.3

1.1

1.0

15.3

15.9

IL&FS Transport. Infra

Buy

25.8

7.0

9.0

10.6

8.2

3.7

3.6

3.2

3.7

Jagran Prakashan Media

Buy

158

189

19.6

8.9

9.9

17.8

16.0

2.3

2.1

20.9

20.4

Mahindra LifespaceReal Estate

Buy

434

554

27.6

13.8

20.1

31.5

21.6

3.8

2.6

3.8

5.3

Navkar Corp.

Logistics

Buy

174

265

52.3

5.6

5.9

30.9

29.7

7.6

6.6

6.3

6.1

Radico Khaitan

Breweries & Dist. Buy

156

62.5

5.8

7.1

16.5

13.5

1.3

1.2

8.6

9.6

Siyaram Silk Mills Textile

Buy

981

1,354

38.0

89.9

104.1

10.9

9.4

0.7

0.6

17.9

17.8

Source: Angel Research

April 5, 2016

Top Picks Report | April 2016

Stock Info

Amara Raja Batteries

CMP

887

 Amara Raja Batteries Ltd (ARBL) is the second largest lead acid storage battery

1,040

manufacturer. ARBL has been outpacing market leader Exide (ARBL grew at a

24% CAGR over FY2010-15 as compared to Exide's growth of 13%), leading

Upside

17.2%

to its market share improving from 25% in FY10 to about 35% currently.

Sector

Auto Ancillary

ARBL's outperformance has been mainly on back of its association with global

Market Cap (` cr)

15,153

battery leader Johnson Controls Inc (which also holds 26% stake in ARBL) for

manufacturing ducts.

Beta

0.8

 With the automotive OEMs following a policy of having multiple vendors and

52 Week High / Low

1,132 / 773

with ARBL’s products enjoying a strong brand recall in the replacement

segment, the company is well poised to gain further market share. Given the

economic recovery and market share gains, the company is expected to grow at

3 year-Chart

a CAGR of 18% over the next two years as against industry growth of 10-12%.

1,200

 ARBL is a well diversified auto ancillary player having presence across the

1,000

automotive and the industrial segment and a broad OEM as well as

replacement customer base. We believe ARBL is a high quality stock to play

800

the auto sector revival. We assign a P/E multiple of

28x to its FY2017E

600

earnings and arrive at a target price of `1,040/share.

400

Key Financials

200

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

4,892

17.4

493

28.8

23.4

30.8

7.2

16.9

3.1

FY2017E

5,871

17.6

634

37.1

24.1

23.9

5.8

14.1

2.5

Source: Company, Angel Research

Stock Info

Bharat Electronics (BEL)

CMP

1,181



(1) High priority to the defense sector in the government’s ‘Make in India’

1,414

campaign, with (1) emphasis on indigenization, (2) increase in FDI limits from

26% to 49%, and (3) Over $50bn worth of projects cleared by Defense

Upside

19.8%

Acquisition Council (DAC) in the last 22 months, indicate at the sector being at

Sector

Capital Goods

an inflexion point where Indian defense capex cycle is entering a new era of

Market Cap (` cr)

28,328

growth. The current bid pipeline could lead to strong award activity for the

next few years and BEL could emerge as a beneficiary.

Beta

1.2

 BEL in FY2015 had 37% market share in the defense electronics space.

52 Week High / Low

1,417 / 974

Considering (1) bid-pipeline of Indian Air Force and Navy’s platform projects,

which have high defense electronic component, (2) BEL’s in-house R&D

capabilities, and (3) its zero debt status, we believe that BEL would maintain its

3 year-Chart

strong market positioning in the defense electronics space.

1600

1400

 We expect BEL to trade at a premium to its historical valuations on account of

1200

uptick in investment cycle. Current low competitive intensity which should

1000

enable BEL to justifiably command scarcity premium, coupled with the fact that

800

the company is the largest listed defense player, makes the stock more

600

attractive. We assign a 1-year forward P/E multiple of 23.0x to arrive at a

400

price target of `1,414. Given the upside, we recommend BUY.

200

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

Source: Company, Angel Research

FY2016E

7,737

16.8

1,296

54.0

39.3

21.9

3.1

16.5

2.8

FY2017E

8,634

17.2

1,475

61.5

45.6

19.2

2.8

13.8

2.4

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Stock Info

HCL Technologies

CMP

844

 Healthy pipeline: During 2QFY2016, the company has signed orders in excess

1,038

of US$1bn (in TCV), including 8 transformational deals. Thus, on back of its

Upside

22.9%

strong order book, the company expects 2HFY2016 to be better than

1HFY2016. Also, during the current quarter, the company acquired Geometric

Sector

Software’s business, which though small in terms of its contribution to sales,

Market Cap (` cr)

1,18,994

would still be positive and add to the company’s capability in engineering

Beta

0.8

services. This comes after its recently announced acquisition of Volvo’s external

52 Week High / Low

1,048 / 786

IT business, which registered a revenue of ~US$190mn.

 Robust outlook: We expect HCL Tech to post a USD and INR revenue CAGR of

13.0% and 13.2%, respectively, over FY2015-17E. On the operating front,

3 year-Chart

HCL Tech's EBIT margin has been around 22.3% in FY2015. Going ahead, the

1200

Management expects EBIT margins to sustain at 21-22% levels. We expect the

1000

EBIT and PAT to post a 7.7% and 6.0% CAGR, respectively, over FY2015-17E.

800

 Outlook and Valuations: At current valuations, the stock is attractively valued

600

and hence we maintain our Buy with a price target of `1,038.

400

200

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

June

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

42,038

21.2

7,216

51.1

21.5

16.5

3.5

11.0

2.3

Source: Company, Angel Research

FY2017E

47,503

21.5

8,142

57.7

18.8

14.6

2.7

8.7

1.9

Source: Company, Angel Research

HDFC Bank

Stock Info

CMP

1,058

 Strong capital adequacy, expanding network, to sustain traction in market

1,262

share: HDFC Bank’s capital adequacy ratio as of 3QFY2016 stood strong at

Upside

19.2%

15.9%, with Tier1 ratio at 13.2%, which positions the bank to continue on its

Sector

Financials

growth path and increase its market share.

Market Cap (` cr)

267,558

 Asset quality rock-solid: The bank has been able to maintain its asset quality

Beta

0.7974

consistently. Asset quality continued to remain healthy with the Gross NPA

52 Week High / Low

1,128 / 929

ratio and the Net NPA ratio at 0.97% and 0.29%, respectively, as of

3QFY2016, in a challenging macro environment.

3 year-Chart

 Outlook: Credit and deposit growth beat the industry growth rate, driven by

1,200

strong retail business, healthy CASA and continued network expansion. This

1,000

provides strong visibility for a robust 20% earnings trajectory, coupled with

800

high quality of earnings. This in our view justifies a premium valuation

600

multiple. At the current market price, the bank is trading at 3.2x its FY2017E

400

ABV. We recommend a Buy rating on the stock, with a target price of `1,262.

200

Key Financials

Y/E

Op. Inc NIM

PAT

EPS

ABV ROA ROE P/E P/ABV

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

Source: Company, Angel Research

FY2016E

38,309

4.3

12,363

49.3

285.4

1.9

18.5

21.5

3.7

FY2017E

47,302

4.3

15,302

61.0

332.2

1.9

19.7

17.3

3.2

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Stock Info

Infosys

CMP

1,219

 Guidance upgraded to

12.8-13.2% CC growth for FY2016: During

1,347

3QFY2016 Infosys has upgraded its USD revenue growth guidance to

Upside

10.5%

12.8-13.2% from 10-12% on CC basis earlier for FY2016. In INR terms, the

Sector

company expects a 16.2-16.6% revenue growth for FY2016. We expect the

company to post ~12.7% USD revenue growth in FY2016.

Market Cap (` cr)

2,79,905

Beta

0.8

 Aims to be US$20bn company by FY2020: The company expects its revenue

to rise to US$20bn by FY2020, up from US$8.7bn in FY2015, as it focuses on

52 Week High / Low

1,250 / 933

acquisitions and winning more new technology services, implying a

14%

CAGR over the period. Over the near term, we expect Infosys to post a 12.7%

USD revenue growth in FY2016. Over FY2015-17E, we expect USD and INR

3 year-Chart

revenue to grow at a CAGR of 12.9% and 14.5%, respectively.

1400

1200

 Outlook and Valuations: The stock trades at a valuation of 18.5x FY2017E

earnings. We recommend Accumulate on the stock with a price target of

1000

`1,347.

800

Key Financials

600

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

400

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

61,850

27.5

13,631

59.4

21.2

20.5

4.4

14.0

3.9

FY2017E

69,891

27.5

15,087

65.7

20.1

18.5

3.7

11.9

3.3

Source: Company, Angel Research

LIC Housing Finance

Stock Info

CMP

468

 Significant under penetration of mortgages in India: India is expected to

592

witness a robust housing finance growth going forward as the mortgage

Upside

26.6%

penetration in India remains at very low levels at 9% to GDP as compared to

the developed countries where it is in the range of 60-100%.

Sector

Financials

Market Cap (` cr)

23,592

 NIM expansion visible: LIC Housing Finance is able to raise funds from low-

cost NCDs due to its strong AAA credit rating and backing by strong

Beta

1.4

promoters like LIC. In a declining interest rate environment, NBFC's like LIC

52 Week High / Low

526 / 389

Housing are well-placed to witness margin improvement in our view.

 Outlook: For companies like LICHF, the funding environment has eased; thus

3 year-Chart

it will lead to lower cost of borrowing, while outlook for growth in retail

600

housing loans remains positive, going forward. We expect the company to

post a healthy loan book CAGR of 18.7% over FY2015-17E, which is likely to

500

reflect in an earnings CAGR of 21.0%, over the same period. The stock

400

currently trades at 2.3x FY2017E ABV. We maintain our Buy rating on the stock,

300

with a target price of `592.

200

100

Key Financials

Y/E

Op. Inc NIM

PAT

EPS

ABV ROA ROE P/E P/ABV

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

3,101

2.5

1,664

33.0

176.7

1.4

19.7

14.2

2.6

Source: Company, Angel Research

FY2017E

3,745

2.5

2,029

40.2

207.6

1.4

20.5

11.6

2.3

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

National Buildings Construction Corporation (NBCC)

Stock Info

CMP

943

 NBCC reported an order book of over

`35,000cr at 3QFY2016-end.

1,089

Considering the bid pipeline for re-development works from Delhi and other

Upside

15.3%

State governments, and with ‘Smart City’ projects to take-off shortly, we expect

NBCC’s order-book to grow 1.5x during FY2016-18E to `59,440cr.

Sector

Construction

 We expect NBCC to report 26.7% revenue CAGR during FY2015-18E (to

Market Cap (` cr)

11,334

`9,506cr), mainly driven by 29.3% revenue CAGR from PMC segment, where

Beta

1.3

re-development projects would contribute the maximum. We expect NBCC to

52 Week High / Low

1,215/ 702

report 41.5% EBITDA CAGR during the same period, led by increased

contribution from PMC segment, which is likely to experience margin

expansion. Owing to lower other income growth assumption, we expect NBCC

3 year-Chart

to report 32.9% PAT CAGR during FY2015-18E to `653cr.

1400

 We have a strong positive view on NBCC, given its growth prospects as

1200

reflected by its strong order book of `35,000cr (6.3x OB to LTM revenues).

1000

Also, emerging opportunities in re-development space, government’s initiative of

800

developing ‘Smart Cities’, and the company’s cash rich status, should aid its growth.

600

On assigning 20.0x P/E multiple to our FY2018E EPS of `54.4/share, we arrive at a

400

200

price target of `1,089. Given the upside, we recommend Buy on the stock.

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

Source: Company, Angel Research

FY2016E

5,816

6.9

355

29.6

24.1

31.9

5.7

24.0

1.7

FY2017E

7,382

7.7

478

39.8

26.7

23.7

4.5

16.5

1.3

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Stock Info

Blue Star

CMP

393

 BSL is one of the largest air-conditioning companies in India. With a mere

458

3% penetration level of ACs vs 25% in China, the overall outlook for the room

Upside

16.8%

air-conditioner (RAC) market in India is favourable.

Sector

Cons. Durable

 BSL’s RAC business has been outgrowing the industry by ~10% points over the

Market Cap (` cr)

3,531

last few quarters, resulting in the company consistently increasing its market

Beta

0.7

share (~7% in FY2014 to ~10% at present). This has resulted in the Cooling

Products Division (CPD)'s share in overall revenues increasing from~23% in

52 Week High / Low

411 / 290

FY2010 to ~42% in FY2015 (expected to improve to ~48% in FY2018E). With

strong brand equity and higher share in split ACs, we expect the CPD to

3 year-Chart

continue to drive growth.

600

 Aided by increasing contribution from the CPD, we expect the overall top-line

500

to post a revenue CAGR of 11.2% over FY2015-18E and margins to improve

400

from 5.3% in FY2015 to 7.1% in FY2018E. Moreover, the proposed merger

300

with Blue Star Infotech will provide cash influx and thus strengthen the balance

200

sheet. We maintain our Buy recommendation on the stock.

100

Key Financials

Y/E

Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

Source: Company, Angel Research

FY2016E

3,548

6.3

123

13.7

26.1

28.7

7.2

17.3

1.1

FY2017E

3,977

6.9

164

17.2

25.4

22.9

4.7

13.5

0.9

Source: Company, Angel Research

Dewan Housing Finance

Stock Info

CMP

189



3^rd largest private sector housing finance: We expect DHFL’s AUM to grow at a

270

CAGR of 20% over FY2015-18, as demand for housing in the middle & low

Upside

43%

income group is picks up, while PAT, CAGR is expected to be 21.2%

 Seasoned and granular loan book with stable asset quality: Individual

Sector

Financials

borrowers account for 75%, while the high yielding loan against property (LAP)

Market Cap (` cr)

5547

and projects loans account for 16% and 8% of advances Despite strong loan

Beta

1.5

growth, the GNPAs and NNPAs are likely to be at ~1.05% and 0.71%, respectively,

52 Week High / Low

268/ 141

for FY2016. Don’t expect any major deterioration in the asset quality going ahead.

 Lower cost of funds will help maintain NIM: Nearly 70% of the bank

180

borrowings are due for maturity over the next three years and swapping a part

3 year-Chart

of that with non-convertible debentures (NCDs), where it has ~100bp cost

300

benefit, will help DHFL in maintaining its NIM at ~2.86%.

 Outlook: We expect the company to post a healthy loan book CAGR of 20%

250

over FY2015-18E, which is likely to translate in an earnings CAGR of 21.3%,

200

over the same period. The stock currently trades at 0.8x FY2018E ABV. We

150

recommend a Buy on the stock, with a target price of `270.

100

Key Financials

Y/E

Op. Inc NIM

PAT

EPS

ABV ROA ROE P/E P/ABV

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

1,621

2.9

757

25.9

171.2

1.2

15.3

6.8

0.9

Source: Company, Angel Research

FY2017E

1,993

2.9

898

30.8

193.8

1.2

15.9

5.8

0.8

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Stock Info

IL&FS Transportation Networks

CMP

 Recently, ITNL reported Commercial Operations Date (CoD) for JSEL and

PSRDCL. Also, Completion certificate was issued for BKEL. TRDCL P-III and

CNTL are expected to commence in next 2-3 months. Further, RIDCRO P-III,

Upside

25.8%

KSEL, KNEL, and BAEL are expected to commence operations in next 9-12

Sector

Construction

months. Accordingly, we expect revenue/ day from these projects to increase

Market Cap (` cr)

2,433

by ~`4cr/day (unadj. for stake).

Beta

1.1

 Interest expenses related to 3 Annuity projects- JSEL, CNTL and TRDCL P-III

52 Week High / Low

197/64

are already captured in Income statement. As a result, we expect minimal

incremental stress on profitability to be seen with the commencement of these

3 year-Chart

projects. Also, we expect ITNL to benefit from declining interest rate cycle,

300

resulting in improved cash flow cycles at the SPV level.

250

 With 7 projects expected to commence in next 12 months, we expect the debt

200

repayment cycle at SPV level to commence, resulting in the overall consol. D/E

150

levels peaking out at ~4.0x. With concerns over higher D/E levels allayed up

100

to certain extent, coupled with attractive valuations of 0.3x FY2017E P/BV

multiple ITNL stock is trading, we upgrade to Buy with price target of `93.

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

Source: Company, Angel Research

FY2016E

7,360

34.0

218

7.0

3.2

10.6

0.4

10.8

3.7

FY2017E

8,825

35.9

301

9.0

3.7

8.2

0.3

10.0

3.6

Source: Company, Angel Research

Jagran Prakashan

Stock Info

CMP

158

 We expect JPL to register a net sales CAGR of ~15% over FY2015-17E, on

back of (a) strong growth in advertising revenue due to improvement in GDP

189

growth, and (b) improvement in circulation revenue owing to combination of

Upside

19.6%

increase in cover price and volume growth.

Sector

Media

 Further the acquisition of Radio City would also boost the company's revenue

Market Cap (` cr)

5,180

going ahead. Radio City has ~20 stations across 7 states in the country and is

second only to ENIL in all its operating circles, ie Delhi, Mumbai, Bengaluru,

Beta

0.6

Chennai, Ahmedabad, Hyderabad, Pune and Lucknow. The company covers

52 Week High / Low

176/108

~51% (~66mn people) of the total radio population.

 Raw material prices have been in a declining trend. Thus, considering lower

3 year-Chart

news print costs, healthy sales, and higher margins in the radio business, we

expect an adj. net profit CAGR of ~20% over FY2015-17E to `325cr.

180

 Considering Dainik Jagran's strong presence in the rapidly growing Hindi

160

markets, we expect JPL to benefit from an eventual recovery in the Indian

140

120

economy. Hence, we maintain an Accumulate rating on the stock with a target

100

price of stock with a target price of `189.

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

2,170

27.2

290

8.9

20.9

17.8

3.7

8.8

2.3

FY2017E

2,355

26.2

325

9.9

20.4

16.0

3.3

8.4

2.1

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Mahindra Lifespace

Stock Info

CMP

424

 Speedy execution & speedier sales: MLF has 13 projects under implementation

across cities. MLF has exhibited fast completion of projects (4-4.5 years in

554

Mumbai, other-wise 3-3.5 years across other cities), compared to others. Sales

Upside

27.6%

cycle in ~65% of projects is faster than execution cycle, contrary to industry

trends. This fast execution and sales is optimal, as it helps MLF in revenue

Sector

Real Estate

recognition, inventory cycle (better than Oberoi, DLF), cash flows and

Market Cap (` cr)

1,781

profitability. This translates in creating virtuous cycle of continuous fast growth.

Beta

0.5

 Strong revenue growth visibility in short-to-long run: MLF as of 3QFY2016 is

pursuing ~5.0mn sq. ft. of sale of the total ~15.0mn sq. ft. of saleable area.

52 Week High / Low

559 / 401

Having sold ~55% of ongoing projects, we expect MLF to launch 2.55mn

sq.ft. of saleable area in rational way during 3QFY2016-2QFY2018E, across

3 year-Chart

6 cities. Maturity at existing projects, new launches give better revenue visibility

for medium-term. We expect MLF to report 72% and 77.9% consol. sales and

700

PAT CAGR during FY2016-18E to `1,273cr and `291cr, respectively. Further,

600

MLF is sitting on land bank of 12.3mn sq.ft across 4 cities, which allays any

500

concern over long-term revenue growth.

400

 With Real Estate Regulatory Bill expected to be realty, MLF should be minimally

300

impacted, given their strong parentage and ethically implemented processes.

200

In longer-term organized, professional run, well funded players would enjoy

100

strong trust due to reliable and fast execution strategy. With improvement in

company’s fundamentals, strong earnings growth visibility and long-term

growth outlook, at current valuations of 1.1x FY2017E P/BV, MLF stock looks

attractive. We maintain BUY on MLF with target price of `554.

Source: Company, Angel Research

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

697

14.9

13.8

3.8

31.5

1.2

26.4

3.8s

FY2017E

1,011

19.3

20.1

5.3

21.6

1.1

13.9

2.6

Source: Company, Angel Research

Stock Info

Navkar

CMP

174

 NCL is one of the largest and one of the three CFS at JNPT with rail

265

connectivity, helping it garner high market share at the port. NCL is in a massive

expansion mode where it is increasing its capacity by 234% to 1,036,889 TEUS

Upside

52.3%

at JNPT and coming up with an ICD at Vapi (with Logistics Park).

Sector

Logistics

 The ICD with rail link should benefit from first mover advantage in a region

Market Cap (` cr)

2,488

that has huge market potential and accounts for ~27% of volumes at JNPT.

Beta

0.6

The ICD should be able to capture the EXIM volumes from the region through

52 Week High / Low

221 / 151

rail link that till now was being custom cleared at JNPT (Import) or being

transported via road and consolidated at JNPT (Export). South Gujarat

volumes will now head straight to the Vapi ICD; thus the company can now

3 year-Chart

cater to bulk commodities and domestic traffic that it had been rejecting owing

to capacity constraints at CFS.

250

 We expect NCL to successfully use its rail advantage and scale up its

200

utilizations at both JNPT and Vapi ICD. We have a Buy rating on the stock.

150

Key Financials

100

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

365

38.3

5.6

6.3

30.9

1.9

23.2

7.6

FY2017E

436

37.5

5.9

6.1

29.7

1.8

20.3

6.6

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Radico Khaitan

Stock Info

CMP

 The IMFL segment is under penetrated. Going forward, increase in income

156

levels would lead to higher growth in IMFL brands. RKL has strong brands in

Upside

62.5%

the premium liquor category which reported a CAGR of ~26% over the last

seven-year period. We expect the growth momentum to continue.

Sector

Breweries & Distilleries

Market Cap (` cr)

1,279

 We expect the price of ENA, a key raw material, to remain stable and

potentially even decline going forward due to higher sugar production and

Beta

0.8

lower demand for ethanol from Indian oil marketing companies

52 Week High / Low

131/78

 We expect a significant hike in liquor prices in the coming financial year as

there haven't been any significant ones in recent times. Also, we believe that

3 year-Chart

industry leader - United Spirits would shift focus on profitability over volume

growth considering the debt on its balance sheet, which in turn, would lead to

180

160

increased scope for other liquor companies to hike prices.

140

 On valuation basis, Radico is trading at ~70% discount to its close peer

120

100

United Spirits. We have a Buy rating on the stock and target price of `156

(22x FY2017E EPS).

Key Financials

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

1,517

12.7

5.8

8.6

16.5

1.4

11.1

1.3

FY2017E

1,635

13.4

7.1

9.6

13.5

1.3

9.7

1.2

Source: Company, Angel Research

Stock Info

Siyaram Silk Mills

CMP

981

 SSML has strong brands which cater to premium as well as popular mass

1,354

segments of the market. Further, in FY2014, SSML entered the ladies' salwar

Upside

38.0%

kameez and ethnic wear segment. Going forward, we believe that the company

Sector

Textile

would be able to leverage its brand equity and continue to post strong performance.

Market Cap (` cr)

920

 The company has a nationwide network of about 1,600 dealers and business

Beta

0.8

partners. It has a retail network of 160 stores and plans to add another 300-

350 stores going forward. Further, the company's brands are sold across

52 Week High / Low

1,400/857

3,00,000 multi brand outlets in the country.

 Going forward, we expect SSML to report a net sales CAGR of ~10% to

3 year-Chart

~`1,815cr and adj.net profit CAGR of ~11% to `98cr over FY2015-17E on

back of market leadership in blended fabrics, strong brand building, wide

1,600

1,400

distribution channel, strong presence in tier II and tier III cities and emphasis

1,200

on latest designs and affordable pricing points. At the current market price,

1,000

SSML trades at an inexpensive valuation. We have a Buy rating on the stock

800

and target price of `1,354.

600

400

Key Financials

200

Y/E

Sales

OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales

March

(` cr)

(%)

(` cr)

(`)

(%)

(x)

FY2016E

1,636

11.5

89.9

17.9

10.9

1.8

7.0

0.7

FY2017E

1,815

11.5

104.1

17.8

9.4

1.6

6.3

0.6

Source: Company, Angel Research

April 5, 2016

Top Picks Report | April 2016

Macro watch

Exhibit 1: Quarterly GDP trends

Exhibit 2: IIP trends

(%)

9.0

12.0

8.3

9.9

7.8

7.7

10.0

8.0

7.5

7.6

7.3

8.0

6.3

6.7

6.6

6.7

7.0

6.4

6.0

4.2

4.3

3.7

5.8

4.0

2.5

3.0

2.5

6.0

2.0

5.0

4.5

4.0

(2.0)

(1.2)

(1.5)

(4.0)

3.0

(3.4)

(6.0)

Source: CSO, Angel Research

Source: MOSPI, Angel Research

Exhibit 3: Monthly CPI inflation trends

Exhibit 4: Manufacturing and services PMI

Mfg. PMI

Services PMI

(%)

56.0

5.6

5.7

6.0

5.4

5.3

5.2

4.9

5.0

54.0

5.0

4.4

3.7

52.0

4.0

50.0

3.0

48.0

2.0

1.0

46.0

44.0

Source: MOSPI, Angel Research

Source: Market, Angel Research; Note: Level above 50 indicates expansion

Exhibit 5: Exports and imports growth trends

Exhibit 6: Key policy rates

(%)

Exports yoy growth

Imports yoy growth

(%)

Repo rate

Reverse Repo rate

CRR

0.0

8.00

(5.0)

7.00

(10.0)

(15.0)

6.00

(20.0)

5.00

(25.0)

4.00

(30.0)

(35.0)

3.00

Source: Bloomberg, Angel Research

Source: RBI, Angel Research

April 5, 2016

Stock Watch | April 2016

Company Name

Reco

CMP

Target

Mkt Cap

Sales (` cr)

OPM (%)

EPS (`)

PER (x)

P/BV (x)

RoE (%)

EV/Sales (x)

(`)

Price (`)

(` cr)

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

Agri / Agri Chemical

Rallis

Neutral

171

3,323

2,097

2,415

14.4

9.5

11.0

18.0

15.5

3.6

3.1

21.1

21.3

1.6

1.4

United Phosphorus

Neutral

459

19,654

12,500

14,375

18.3

29.8

35.9

15.4

12.8

2.8

2.4

20.0

20.3

1.7

1.4

Auto & Auto Ancillary

Ashok Leyland

Neutral

109

30,963

17,995

21,544

11.4

11.6

3.4

4.7

32.0

23.1

5.6

5.2

17.7

22.2

1.7

1.4

Bajaj Auto

Accumulate

2,396

2,585

69,345

22,709

25,860

20.9

20.1

129.0

143.6

18.6

16.7

5.7

4.9

30.7

29.4

2.6

2.2

Bharat Forge

Accumulate

829

875

19,309

7,351

8,318

19.9

19.7

31.2

36.5

26.6

22.7

4.8

4.0

19.3

19.2

2.8

2.4

Eicher Motors

Accumulate 18,736

20,044

50,888

15,556

16,747

15.5

17.3

464.8

597.5

40.3

31.4

14.7

10.8

36.2

34.3

3.2

2.9

Gabriel India

Accumulate

101

1,289

1,415

1,544

8.7

9.0

4.6

5.4

19.5

16.6

3.5

3.1

18.1

18.9

0.9

0.8

Hero Motocorp

Neutral

2,956

59,033

28,244

30,532

15.5

15.9

156.7

168.5

18.9

17.5

7.5

6.4

39.9

36.4

1.9

1.7

Jamna Auto Industries

Accumulate

142

160

1,134

1,281

1,473

11.2

11.5

7.6

9.2

18.7

15.4

4.7

3.9

25.4

25.2

0.9

0.8

L G Balakrishnan & Bros Neutral

468

735

1,254

1,394

11.6

11.8

35.9

41.7

13.0

11.2

1.8

1.6

13.5

13.8

0.7

0.6

Mahindra and Mahindra Accumulate

1,216

1,364

75,525

38,416

42,904

13.7

13.9

54.8

63.4

22.2

19.2

3.4

3.0

15.4

15.8

1.6

1.4

Maruti

Neutral

3,546

107,131

57,865

68,104

16.4

16.7

176.3

225.5

20.1

15.7

3.9

3.3

19.4

21.2

1.6

1.3

Minda Industries

Neutral

1,008

1,600

2,523

2,890

8.7

9.0

55.0

65.4

18.3

15.4

3.5

2.9

19.3

18.7

0.7

0.6

Motherson Sumi

Buy

252

313

33,319

39,343

45,100

8.8

9.1

10.1

12.5

24.9

20.2

7.9

6.2

35.3

34.4

0.9

0.8

Rane Brake Lining

Buy

374

465

296

454

511

11.5

12.0

25.2

31.0

14.8

12.1

2.2

2.0

14.9

16.6

0.8

0.7

Setco Automotive

Neutral

406

594

741

12.7

13.7

1.7

3.2

17.9

9.5

1.9

1.6

10.4

16.9

1.1

0.9

Tata Motors

Neutral

371

106,971

259,686

273,957

13.0

13.4

25.9

29.5

14.3

12.6

1.9

1.6

8.0

9.0

0.6

TVS Motor

Neutral

315

14,944

11,263

13,122

6.9

8.5

9.2

15.0

34.2

21.0

7.8

6.2

22.7

29.6

1.3

1.1

Amara Raja Batteries

Buy

887

1,040

15,153

4,892

5,871

17.4

17.6

28.8

37.1

30.8

23.9

7.2

5.8

23.4

24.1

3.1

2.5

Exide Industries

Buy

135

162

11,471

6,950

7,784

14.4

14.8

6.6

7.3

20.4

18.5

2.6

2.4

12.6

12.8

1.4

1.2

Apollo Tyres

Accumulate

166

183

8,427

12,056

12,714

17.2

16.4

23.0

20.3

7.2

8.2

1.3

1.1

17.7

13.6

0.7

0.8

Ceat

Accumulate

1,048

1,119

4,237

6,041

6,597

14.1

13.7

99.5

111.9

10.5

9.4

2.1

1.7

19.6

18.5

0.8

0.7

JK Tyres

Neutral

1,883

7,446

7,669

15.2

14.0

19.6

18.4

4.2

4.5

1.1

0.9

25.2

19.5

0.6

Swaraj Engines

Accumulate

871

919

1,081

552

630

14.2

14.7

44.6

54.1

19.5

16.1

4.5

4.1

23.2

25.6

1.8

1.5

Subros

Neutral

533

1,293

1,527

11.8

11.9

4.2

6.7

21.1

13.3

1.6

1.4

7.7

11.5

0.7

0.6

Indag Rubber

Neutral

173

454

283

329

17.0

17.2

13.0

15.4

13.4

11.2

2.9

2.4

21.8

21.6

1.3

1.1

Banking

Allahabad Bank

Neutral

3,270

8,569

9,392

2.8

2.9

16.3

27.5

3.3

2.0

0.3

0.25

7.6

11.9

Axis Bank

Accumulate

432

494

102,978

26,473

31,527

3.5

3.6

35.7

43.5

12.1

9.9

2.0

1.75

17.9

18.9

Bank of Baroda

Neutral

144

33,249

18,485

21,025

1.9

2.0

13.5

21.1

10.7

6.8

0.8

7.3

10.6

Bank of India

Neutral

7,648

15,972

17,271

1.9

2.0

15.3

33.3

6.2

2.8

0.3

0.2

3.6

7.6

Canara Bank

Neutral

187

10,129

15,441

16,945

2.0

2.1

46.6

70.4

4.0

2.6

0.4

0.3

8.0

11.2

Dena Bank

Neutral

1,894

3,440

3,840

2.1

2.3

7.2

10.0

4.0

2.9

0.3

0.2

6.1

7.9

Diwan Housing Finance

Federal Bank

Neutral

7,516

3,477

3,999

3.0

5.0

6.2

8.7

7.0

0.9

0.8

10.5

11.9

HDFC

Neutral

1,103

174,320

10,358

11,852

3.3

41.1

47.0

26.9

23.5

5.1

4.6

24.7

24.9

HDFC Bank

Buy

1,058

1,262

267,558

38,309

47,302

4.3

49.3

61.0

21.5

17.3

3.7

3.19

18.5

19.7

ICICI Bank

Accumulate

226

254

131,112

34,279

39,262

3.3

21.0

24.4

10.7

9.3

1.8

1.5

14.4

14.7

April 5, 2016

Stock Watch | April 2016

Company Name

Reco

CMP

Target

Mkt Cap

Sales (` cr)

OPM (%)

EPS (`)

PER (x)

P/BV (x)

RoE (%)

EV/Sales (x)

(`)

Price (`)

(` cr)

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

IDBI Bank

Neutral

14,021

9,625

10,455

1.8

8.5

14.2

8.0

4.8

0.5

0.4

5.9

9.3

Indian Bank

Neutral

102

4,911

6,160

6,858

2.4

2.5

24.5

29.8

4.2

3.4

0.3

7.7

8.6

LIC Housing Finance

Buy

468

592

23,593

3,101

3,745

2.5

33.0

40.2

14.2

11.6

2.6

2.3

19.7

20.5

Oriental Bank

Neutral

2,684

7,643

8,373

2.4

37.2

45.4

2.4

2.0

0.2

8.2

9.4

Punjab Natl.Bank

Neutral

16,268

23,638

26,557

2.8

17.9

27.2

4.6

3.0

0.5

0.4

8.5

12.0

South Ind.Bank

Neutral

2,363

1,965

2,185

2.5

3.3

7.0

5.3

0.7

0.6

9.5

11.6

St Bk of India

Neutral

185

143,223

79,958

86,060

2.6

13.4

20.7

13.8

8.9

1.1

1.0

11.5

12.8

Union Bank

Neutral

129

8,895

12,646

14,129

2.3

2.4

31.0

39.1

4.2

3.3

0.4

9.8

11.4

Vijaya Bank

Neutral

2,706

3,536

3,827

1.8

1.9

5.5

6.7

5.7

4.7

0.5

0.4

7.8

8.8

Yes Bank

Neutral

829

34,873

7,190

9,011

3.2

3.3

58.2

69.7

14.2

11.9

2.5

2.2

19.2

19.6

Capital Goods

ACE

Neutral

373

660

839

4.7

8.2

1.0

3.9

37.8

9.7

1.2

1.0

3.2

11.3

0.7

0.6

BEML

Buy

973

1,157

4,052

3,277

4,006

6.0

8.9

36.2

64.3

26.9

15.1

1.9

1.7

5.7

11.7

1.3

1.0

Bharat Electronics

Buy

1,181

1,414

28,345

7,737

8,634

16.8

17.2

54.0

61.5

21.9

19.2

3.1

2.8

39.3

45.6

2.8

2.4

Voltas

Buy

274

353

9,058

5,363

5,963

8.0

9.1

11.0

13.8

24.9

19.8

3.8

3.3

16.2

17.9

1.6

1.5

BGR Energy

Neutral

104

748

3,615

3,181

9.5

9.4

16.7

12.4

6.2

8.4

0.6

10.0

7.0

0.6

0.8

BHEL

Neutral

113

27,609

33,722

35,272

10.8

11.7

10.5

14.2

10.7

7.9

0.8

0.7

7.0

9.0

0.9

Blue Star

Buy

393

458

3,531

3,548

3,977

6.3

6.9

13.7

17.2

28.7

22.9

7.2

4.7

26.1

25.4

1.1

0.9

Crompton Greaves

Neutral

3,077

13,484

14,687

4.9

6.2

4.5

7.1

10.9

6.9

0.8

0.7

7.2

10.8

0.4

0.3

Greaves Cotton

Neutral

125

3,054

1,655

1,755

16.6

16.8

7.4

7.8

16.9

16.0

3.4

3.2

21.1

20.6

1.8

1.7

Inox Wind

Buy

246

458

5,461

4,980

5,943

17.0

17.5

26.6

31.6

9.3

7.8

2.8

2.0

35.0

30.0

1.2

1.0

KEC International

Neutral

124

3,179

8,791

9,716

6.1

6.8

5.4

8.2

22.9

15.1

2.3

2.1

10.0

14.0

0.6

0.5

Thermax

Neutral

751

8,952

6,413

7,525

7.4

8.5

30.5

39.3

24.6

19.1

3.8

3.3

15.0

17.0

1.4

1.1

VATech Wabag

Neutral

520

2,834

2,722

3,336

7.9

8.1

19.5

24.6

26.7

21.1

2.8

2.5

11.1

12.4

1.1

0.9

Cement

ACC

Neutral

1,390

26,104

13,151

14,757

16.4

18.3

63.9

83.4

21.8

16.7

2.8

2.6

13.3

16.1

1.8

1.5

Ambuja Cements

Neutral

226

35,096

11,564

12,556

19.4

20.7

8.9

10.1

25.4

22.4

3.2

3.0

12.8

13.8

2.7

2.4

HeidelbergCement

Neutral

1,938

1,772

1,926

13.3

15.4

1.0

3.0

85.5

28.5

2.2

2.0

2.6

7.9

1.7

1.4

India Cements

Neutral

2,583

4,216

4,840

18.0

19.5

4.0

9.9

21.0

8.5

0.8

4.0

9.5

0.9

0.7

JK Cement

Neutral

648

4,532

3,661

4,742

10.1

15.8

7.5

28.5

86.4

22.7

2.6

2.3

7.5

22.9

1.7

1.3

J K Lakshmi Cement

Neutral

328

3,855

2,947

3,616

16.7

19.9

11.5

27.2

28.5

12.0

2.7

2.3

9.8

20.8

1.7

1.4

Mangalam Cements

Neutral

225

602

1,053

1,347

10.5

13.3

8.4

26.0

26.8

8.7

1.1

1.0

4.3

12.5

0.9

0.7

Orient Cement

Neutral

148

3,028

1,854

2,524

21.2

22.2

7.7

11.1

19.2

13.3

2.8

2.4

13.3

15.7

2.4

1.7

Ramco Cements

Neutral

407

9,698

4,036

4,545

20.8

21.3

15.1

18.8

27.0

21.7

3.3

2.9

12.9

14.3

2.9

2.5

Shree Cement^

Neutral

12,077

42,071

7,150

8,742

26.7

28.6

228.0

345.5

53.0

35.0

7.8

6.5

15.7

20.3

5.6

4.5

UltraTech Cement

Neutral

3,101

85,102

24,669

29,265

18.2

20.6

82.0

120.0

37.8

25.8

4.1

3.6

11.3

14.7

3.5

3.0

Construction

ITNL

Buy

2,433

7,360

8,825

34.0

35.9

7.0

9.0

10.6

8.2

0.4

0.3

3.2

3.7

3.6

KNR Constructions

Buy

517

603

1,454

937

1,470

14.3

14.0

44.2

38.6

11.7

13.4

2.3

2.0

15.4

1.6

1.1

Larsen & Toubro

Accumulate

1,195

1,310

111,307

58,870

65,708

8.3

10.3

42.0

53.0

28.5

22.5

2.0

1.8

8.8

11.2

2.1

1.9

Gujarat Pipavav Port

Neutral

173

8,385

629

684

51.0

52.2

6.4

5.9

27.1

29.4

3.6

3.3

15.9

12.7

13.0

11.7

MBL Infrastructures

Buy

155

285

642

2,313

2,797

12.2

14.6

19.0

20.0

8.2

7.7

0.8

11.3

10.6

1.0

0.9

Nagarjuna Const.

Neutral

4,050

7,892

8,842

8.8

9.1

3.0

5.3

24.3

13.7

1.2

1.1

5.0

8.5

0.7

0.6

PNC Infratech

Accumulate

527

558

2,704

1,873

2,288

13.2

13.5

24.0

32.0

22.0

16.5

2.1

1.9

12.1

12.3

1.5

1.3

April 5, 2016

Stock Watch | April 2016

Company Name

Reco

CMP

Target

Mkt Cap

Sales (` cr)

OPM (%)

EPS (`)

PER (x)

P/BV (x)

RoE (%)

EV/Sales (x)

(`)

Price (`)

(` cr)

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

Simplex Infra

Neutral

246

1,215

5,955

6,829

10.3

10.5

16.0

31.0

15.3

7.9

0.8

0.7

5.3

9.9

0.7

0.6

Power Mech Projects

Neutral

576

847

1,539

1,801

12.8

12.7

59.0

72.1

9.8

8.0

1.5

1.2

18.6

16.8

0.6

0.5

Sadbhav Engineering

Neutral

280

4,796

3,481

4,219

10.7

10.8

8.2

11.7

34.1

23.9

3.3

2.9

10.3

13.5

1.6

1.4

NBCC

Buy

943

1,089

11,321

5,816

7,382

6.9

7.7

29.6

39.8

31.9

23.7

5.7

4.5

24.1

26.7

1.7

1.3

MEP Infra

Neutral

624

1,956

1,876

28.1

30.5

1.3

3.0

29.5

12.8

6.2

4.2

21.2

32.8

1.7

SIPL

Neutral

3,475

675

1,042

62.4

64.7

3.7

4.2

16.8

11.3

Engineers India

Neutral

168

5,659

1,667

1,725

13.5

16.0

9.7

11.4

17.3

14.7

2.0

11.7

13.4

2.2

FMCG

Asian Paints

Neutral

869

83,378

16,553

19,160

16.0

16.2

17.7

21.5

49.2

40.4

13.1

11.7

29.4

31.2

4.9

4.2

Britannia

Neutral

2,636

31,629

8,481

9,795

14.0

14.1

65.5

78.3

40.2

33.7

19.0

15.6

38.3

41.2

3.6

3.1

Colgate

Neutral

832

22,641

4,836

5,490

19.5

19.7

48.5

53.2

17.2

15.6

12.6

11.0

99.8

97.5

4.6

4.0

Dabur India

Accumulate

246

267

43,205

9,370

10,265

17.1

17.2

7.3

8.1

33.5

30.3

10.1

8.2

33.7

30.6

4.5

4.1

GlaxoSmith Con*

Neutral

6,034

25,376

4,919

5,742

17.2

17.4

168.3

191.2

35.9

31.6

10.2

8.7

28.8

28.9

4.7

4.0

Godrej Consumer

Neutral

1,354

46,103

10,168

12,886

16.1

32.1

38.4

42.2

35.3

8.6

7.9

19.7

21.0

4.6

3.6

HUL

Neutral

868

187,884

34,940

38,957

17.5

17.7

20.8

24.7

41.7

35.2

46.4

37.1

110.5

114.2

5.2

4.6

ITC

Accumulate

327

359

262,741

36,804

38,776

37.9

12.2

12.9

26.8

25.3

7.4

6.5

27.7

25.8

6.7

6.4

Marico

Neutral

245

31,577

6,551

7,766

15.7

16.0

10.4

12.5

23.6

19.6

6.8

5.7

33.2

32.4

4.7

4.0

Nestle*

Buy

5,724

6,646

55,189

11,291

12,847

22.2

22.3

158.9

184.6

36.0

31.0

18.8

16.9

55.0

57.3

4.7

4.1

Tata Global

Buy

118

144

7,463

8,635

9,072

9.8

9.9

6.5

7.6

18.2

15.6

1.8

1.7

6.8

7.4

0.8

HCL Tech^

Buy

844

1,038

118,994

42,038

47,503

21.2

21.5

51.5

57.7

16.4

14.6

3.5

2.7

21.5

18.8

2.4

2.0

Infosys

Accumulate

1,219

1,347

280,820

61,850

69,981

27.5

59.4

65.7

20.5

18.5

4.4

3.7

21.2

20.1

3.8

3.2

TCS

Buy

2,463

2,854

485,247

108,487

122,590

28.3

28.5

122.8

138.4

20.1

17.8

7.6

6.9

38.0

38.9

4.1

3.5

Tech Mahindra

Accumulate

462

530

44,756

26,524

29,177

16.2

17.0

28.8

33.6

16.1

13.8

3.1

2.6

19.3

19.1

1.5

1.2

Wipro

Buy

560

680

138,248

50,808

56,189

23.7

23.8

37.3

40.7

15.0

13.7

2.9

2.6

19.2

17.7

2.2

1.8

Media

D B Corp

Buy

305

356

5,601

2,241

2,495

27.8

27.9

21.8

25.6

14.0

11.9

3.7

3.2

26.7

28.5

2.4

2.2

HT Media

Neutral

1,779

2,495

2,603

11.2

7.3

8.6

10.5

8.9

0.8

0.7

7.4

8.1

0.2

Jagran Prakashan

Buy

158

189

5,180

2,170

2,355

27.2

26.2

8.9

9.9

17.8

16.0

3.7

3.3

20.9

20.4

2.3

2.1

Sun TV Network

Neutral

359

14,161

2,779

3,196

70.2

70.5

22.8

27.3

15.8

13.2

3.9

3.5

26.7

28.3

4.8

4.2

Hindustan Media

Neutral

245

1,800

920

1,031

20.0

19.2

20.9

12.8

11.7

2.1

1.8

16.4

15.3

1.5

1.3

Metal

Coal India

Buy

276

380

174,395

76,167

84,130

19.9

22.3

22.4

25.8

12.3

10.7

4.4

4.3

35.5

41.0

1.6

1.4

Hind. Zinc

Neutral

187

79,035

14,641

14,026

50.4

17.7

16.0

10.6

11.7

1.6

1.5

16.2

13.2

3.0

2.9

Hindalco

Neutral

17,532

104,356

111,186

8.7

9.5

6.7

11.1

12.6

7.7

0.5

0.4

3.5

5.9

0.7

0.6

JSW Steel

Neutral

1,257

30,375

42,308

45,147

16.4

20.7

(10.3)

49.5

25.4

1.4

1.3

(1.0)

5.6

1.8

1.6

NMDC

Neutral

38,755

8,237

10,893

46.6

44.5

9.9

11.7

9.8

8.4

1.1

1.0

12.4

13.0

4.5

3.4

SAIL

Neutral

17,532

45,915

53,954

7.2

10.5

1.5

4.4

28.2

9.7

0.4

2.3

4.1

1.0

0.9

Vedanta

Neutral

25,452

71,445

81,910

26.2

12.9

19.2

6.7

4.5

0.5

0.4

7.2

8.9

0.8

0.6

Tata Steel

Neutral

312

30,312

126,760

137,307

8.9

11.3

6.4

23.1

49.1

13.5

1.0

0.9

2.0

7.1

0.8

April 5, 2016

Stock Watch | April 2016

Company Name

Reco

CMP

Target

Mkt Cap

Sales (` cr)

OPM (%)

EPS (`)

PER (x)

P/BV (x)

RoE (%)

EV/Sales (x)

(`)

Price (`)

(` cr)

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

Oil & Gas

Cairn India

Neutral

147

27,467

11,323

12,490

49.4

51.0

20.7

20.6

7.1

0.5

0.4

6.4

6.1

1.5

0.8

GAIL

Neutral

340

43,166

64,856

70,933

9.1

9.6

24.0

28.9

14.2

11.8

1.2

1.1

8.8

9.6

0.8

ONGC

Neutral

206

175,858

154,564

167,321

36.8

37.4

28.6

32.5

7.2

6.3

0.9

0.8

12.7

13.5

1.3

Petronet LNG

Neutral

245

18,338

29,691

31,188

5.8

6.2

12.8

13.4

19.1

18.2

2.9

2.5

15.8

14.8

0.7

0.6

Indian Oil Corp

Accumulate

402

455

97,640

359,607

402,760

5.9

6.1

42.5

48.7

9.5

8.3

1.3

1.1

14.1

14.3

0.4

0.3

Reliance Industries

Accumulate

1,028

1,150

333,143

304,775

344,392

12.6

13.4

91.3

102.6

11.3

10.0

1.3

1.1

11.8

12.0

1.0

0.8

Pharmaceuticals

Alembic Pharma

Neutral

589

11,095

3,274

3,802

26.9

19.4

35.0

28.7

16.8

20.5

7.5

5.6

55.6

31.2

3.4

2.8

Aurobindo Pharma

Accumulate

751

856

43,940

14,923

17,162

22.0

23.0

35.7

42.8

21.0

17.5

6.2

4.7

34.0

30.2

3.3

2.8

Aventis*

Neutral

4,198

9,668

2,082

2,371

17.4

20.8

118.2

151.5

35.5

27.7

5.2

4.2

19.9

25.5

4.3

3.6

Cadila Healthcare

Accumulate

318

352

32,576

10,224

11,840

21.0

22.0

14.6

17.6

21.8

18.1

6.0

4.7

30.8

29.0

3.2

2.7

Cipla

Buy

504

605

40,491

13,979

16,447

20.2

18.6

25.7

27.5

19.6

18.3

3.2

2.8

17.6

16.1

2.9

2.4

Dr Reddy's

Buy

2,996

3,933

51,092

16,838

19,575

25.0

23.1

167.5

178.8

17.9

16.8

3.8

3.1

23.1

20.4

3.0

2.5

Dishman Pharma

Neutral

331

2,670

1,733

1,906

21.5

17.0

19.9

19.5

16.6

2.0

1.8

10.5

11.2

2.1

1.8

GSK Pharma*

Neutral

3,699

31,327

2,870

3,158

20.0

22.1

59.5

68.3

62.2

54.2

18.3

18.8

28.5

34.3

10.4

9.5

Indoco Remedies

Neutral

274

2,528

1,033

1,199

15.9

18.2

9.4

13.6

29.2

20.2

4.3

3.7

15.7

19.7

2.5

2.2

Ipca labs

Buy

557

900

7,024

3,363

3,909

12.9

18.6

13.4

28.0

41.5

19.9

3.0

2.6

7.4

14.0

2.4

2.0

Lupin

Accumulate

1,463

1,560

65,923

13,092

16,561

25.0

27.0

50.4

68.3

29.0

21.4

6.0

4.7

22.8

24.7

4.7

3.6

Sun Pharma

Buy

801

950

192,666

28,163

32,610

25.8

30.7

17.4

26.9

46.0

29.8

4.4

3.8

13.0

16.6

6.3

5.2

Power

Tata Power

Neutral

18,121

35,923

37,402

22.6

22.8

4.1

5.2

16.5

13.0

1.3

1.2

7.5

9.3

1.4

1.3

NTPC

Buy

127

146

104,717

87,271

99,297

23.4

23.5

11.7

13.3

10.8

9.6

1.2

1.1

11.5

12.2

2.2

2.0

Power Grid

Buy

139

170

72,719

20,702

23,361

86.7

86.4

12.1

13.2

11.5

10.5

1.7

1.5

15.6

15.1

8.4

7.8

Real Estate

MLIFE

Buy

434

554

1,781

697

1,011

14.9

19.3

13.8

20.1

31.5

21.6

1.2

1.1

3.8

5.3

3.8

2.6

Telecom

Bharti Airtel

Neutral

330

132,054

101,748

109,191

32.1

31.7

12.0

12.5

27.5

26.4

1.9

1.8

6.9

6.7

1.9

1.7

Idea Cellular

Neutral

109

39,372

34,282

36,941

32.0

31.5

5.9

6.2

18.5

17.6

1.7

1.5

9.9

9.3

1.7

1.6

Others

Abbott India

Neutral

4,593

9,760

2,715

3,153

14.5

14.1

134.3

152.2

34.2

30.2

8.5

7.0

27.4

25.6

3.3

2.8

Bajaj Electricals

Accumulate

208

237

2,098

4,719

5,287

5.2

5.8

8.6

12.7

24.3

16.4

2.8

2.4

11.4

14.8

0.4

Banco Products (India)

Neutral

111

796

1,208

1,353

10.9

12.3

10.8

14.5

10.3

7.7

1.2

1.1

11.9

14.5

0.6

0.5

Coffee Day Enterprises

Neutral

227

4,667

2,692

2,964

17.0

18.6

4.7

47.8

2.8

2.6

0.1

5.5

2.1

2.0

Competent Automobiles Neutral

135

1,040

1,137

3.2

3.1

25.7

28.0

5.3

4.8

0.8

0.7

15.0

14.3

0.1

Elecon Engineering

Neutral

645

1,359

1,482

10.3

13.6

0.8

3.9

73.8

15.2

1.2

1.6

7.8

0.8

Finolex Cables

Neutral

286

4,370

2,520

2,883

12.2

12.0

12.7

14.2

22.6

20.1

3.1

2.7

13.6

13.5

1.5

1.2

Garware Wall Ropes

Buy

325

473

712

862

974

11.2

24.9

29.6

13.1

11.0

2.0

1.7

15.1

15.4

0.8

0.7

Goodyear India*

Buy

498

582

1,148

1,800

1,600

11.7

11.5

58.7

52.9

8.5

9.4

1.9

1.6

24.6

18.7

0.4

April 5, 2016

Stock Watch | April 2016

Company Name

Reco

CMP

Target

Mkt Cap

Sales (` cr)

OPM (%)

EPS (`)

PER (x)

P/BV (x)

RoE (%)

EV/Sales (x)

(`)

Price (`)

(` cr)

FY16E

FY17E

FY16E

FY17E FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

FY16E

FY17E

Hitachi

Neutral

1,168

3,177

1,779

2,081

7.8

8.8

21.8

33.4

53.6

34.9

8.6

7.0

17.4

22.1

1.8

1.6

HSIL

Neutral

300

2,166

2,123

2,384

16.1

16.5

15.0

18.9

19.9

15.9

1.5

1.4

8.0

9.4

1.4

1.2

Interglobe Aviation

Neutral

973

35,079

17,022

21,122

20.7

14.5

63.9

53.7

15.2

18.1

22.8

18.7

149.9

103.2

2.1

1.7

Jyothy Laboratories

Neutral

298

5,391

1,620

1,847

11.5

7.3

8.5

40.8

35.1

5.3

4.9

13.3

14.4

3.2

2.7

Kirloskar Engines India

Neutral

216

3,124

2,403

2,554

8.6

9.9

9.2

10.5

23.5

20.6

2.3

2.2

9.7

10.7

0.9

Linc Pen & Plastics

Neutral

193

286

340

371

8.3

8.9

10.8

13.2

17.9

14.7

2.9

2.5

16.0

17.1

0.9

0.8

M M Forgings

Buy

456

614

551

511

615

21.7

21.6

43.1

55.8

10.6

8.2

1.9

1.6

19.9

21.2

1.3

1.0

Manpasand Bever.

Neutral

452

2,260

540

836

19.9

19.6

10.2

16.9

44.1

26.7

3.6

3.2

8.1

12.0

3.9

2.4

MRF

Buy

35,776

45,575

15,173

20,316

14,488

21.4

21.1

5,488.0

3,797.9

6.5

9.4

2.2

1.8

41.1

21.2

0.7

0.9

MT Educare

Neutral

164

652

286

366

18.3

17.7

7.7

9.4

21.2

17.5

4.5

3.9

20.2

21.1

2.2

1.7

Narayana Hrudaya

Neutral

296

6,053

1,603

1,873

10.9

11.5

1.0

2.6

310.9

112.0

7.5

6.9

2.4

6.1

3.9

3.3

Navkar Corporation

Buy

174

265

2,488

365

436

38.3

37.5

5.6

5.9

30.9

29.7

1.9

1.8

6.3

6.1

7.6

6.6

Navneet Education

Neutral

1,962

998

1,062

24.1

24.0

5.8

6.1

14.3

13.5

3.2

2.8

22.0

20.5

2.0

1.9

Nilkamal

Neutral

1,102

1,644

1,871

2,031

10.7

10.5

63.2

69.8

17.4

15.8

2.8

2.4

17.6

16.6

0.9

0.8

Page Industries

Neutral

12,096

13,491

1,929

2,450

19.8

20.1

229.9

299.0

52.6

40.5

23.2

16.1

52.1

47.0

7.0

5.5

Quick Heal

Neutral

219

1,531

339

408

27.8

27.3

7.1

7.7

30.9

28.2

2.6

8.5

9.3

3.4

2.9

Radico Khaitan

Buy

156

1,279

1,517

1,635

12.7

13.4

5.8

7.1

16.5

13.5

1.4

1.3

8.6

9.6

1.3

1.2

Relaxo Footwears

Neutral

503

6,038

1,767

2,152

12.3

12.5

19.2

25.1

26.1

20.1

6.4

4.9

27.7

27.8

3.5

2.8

S H Kelkar & Co.

Neutral

227

3,284

928

1,036

15.3

15.1

4.9

6.1

46.0

37.2

4.3

4.0

9.4

10.7

3.4

3.0

Siyaram Silk Mills

Buy

981

1,354

920

1,636

1,815

11.5

89.9

104.1

10.9

9.4

1.8

1.6

17.9

17.8

0.7

0.6

Styrolution ABS India*

Neutral

581

1,021

1,271

1,440

8.6

9.2

32.0

41.1

18.1

14.1

1.9

1.7

10.7

12.4

0.8

0.7

Surya Roshni

Buy

140

201

613

2,992

3,223

8.1

8.4

14.7

18.3

9.5

7.6

0.9

0.8

9.7

11.0

0.5

0.4

Team Lease Serv.

Neutral

882

1,508

2,565

3,229

1.3

1.5

15.2

22.8

58.1

38.7

4.6

4.1

8.0

10.7

0.5

0.4

The Byke Hospitality

Neutral

152

610

222

287

20.5

5.6

7.6

27.0

20.1

5.1

4.2

18.8

20.7

2.8

2.1

Transport Corp. of India

Neutral

273

2,078

2,830

3,350

8.8

9.0

14.4

18.3

19.0

14.9

2.9

2.5

15.4

17.1

0.9

0.7

TVS Srichakra

Buy

2,379

3,217

1,821

2,035

2,252

15.9

15.3

248.6

268.1

9.6

8.9

4.2

3.0

43.6

33.9

0.9

0.8

UFO Moviez

Neutral

453

1,247

558

619

32.0

33.2

22.5

30.0

20.1

15.1

2.4

2.1

12.0

13.8

2.1

1.7

Visaka Industries

Buy

110

144

174

1,086

1,197

9.9

10.2

21.5

28.7

5.1

3.8

0.5

0.4

9.6

11.6

0.4

0.3

VRL Logistics

Neutral

369

3,371

1,725

1,902

16.5

16.7

12.2

14.6

30.4

25.4

6.3

5.6

20.8

21.9

2.1

1.9

Wonderla Holidays

Neutral

380

2,150

206

308

44.0

43.6

9.0

12.9

42.3

29.5

5.8

5.2

13.7

17.8

10.3

6.9

Source: Company, Angel Research, Note: *December year end; ^#September year end;

^&October year end; ^June year end; Price as of April 5, 2016; Sesa Goa's numbers reflect the standalone Sesa Goa business only. We will revise our numbers once the

consolidated entity Sesa- Sterlite is formed

April 5, 2016

Top Picks Report | April 2016

Research Team Tel: 022 - 39357800

E-mail: [email protected]

Website: www.angelbroking.com

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April 5, 2016