Indiadaily 18 March 2011

INDIA DAILY
March 18, 2011 India 17-Mar 1-day1-mo 3-mo
Sensex 18,150 (1.1) (1.9) (8.6)
Nifty 5,447 (1.2) (1.8) (8.4)

Contents Global/Regional indices
New release Dow Jones 11,775 1.4 (4.4) 2.5

Nasdaq Composite 2,636 0.7 (6.9) (0.3)
Energy: Oil on the boil will make India toil
FTSE 5,696 1.7 (6.4) (3.0)
Updates Nikkie 9,166 2.3 (15.5) (11.0)
Sun Pharmaceuticals: Multiple triggers present upside to our FY2012E EPS Hang Seng 22,388 0.5 (5.1) (1.4)
Nestle India: Analyst meet takeaways KOSPI 1,967 0.4 (2.3) (2.9)
Value traded – India

United Phosphorus: MAI confirms positive outlook for 1Q2011E
Cash (NSE+BSE) 140 155 135
Economy: RBI Credit Policy: Inflation rules the roost
Derivatives (NSE) 1,179 1,253 1,291
Telecom: Feb GSM SIM net adds - strong growth and solid show from incumbents Deri. open interest 1,419 1,601 1,499
Forex/money market
News Round-up Change, basis points
17-Mar 1-day 1-mo 3-mo
` In its mid-quarter monetary policy review, RBI increased key policy rates by a quarter
Rs/US$ 45.2 7 (16) (16)
point, the eight increase in a year, warning that rising oil prices will put more 10yr govt bond, % 8.0 - (12) (1)
pressure in the already high inflation. The RBI's short-term lending rate has gone up Net investment (US$mn)
from 6.5% to 6.75% with immediate effect. The reverse repo, its short term 16-Mar MTD CYTD
borrowing rate has risen from 5.5% to 5.75%. (BSTD) FIIs (28) 538 (1,675)
MFs 63 46 (282)
` Reliance Ind. (RIL IN), GAIL (GAIL IN) & Andhra power producers have signed
agreements involving swapping of gas to ensure additional gas supply for generating Top movers -3mo basis
600mw power in the state. (BSTD) Change, %
Best performers 17-Mar 1-day 1-mo 3-mo
` GAIL (India) Ltd (GAIL IN), Reliance Industries Ltd (RIL IN), Reliance Gas transportation
WLCO IN Equity 200.4 (2.7) 9.2 17.4
Infrastructure Ltd (RGTIL), and power plants in Andhra Pradesh have agreed to swap SIEM IN Equity 871.8 0.0 3.2 12.2
Krishna Godavari Basin D6 gas with imported gas. (THBL) NACL IN Equity 104.0 (3.7) 2.0 11.2
LICHF IN Equity 198.9 0.4 3.3 8.6
` The govt. may revoke allocation of 31 coal blocks held by Tata Steel (TATA IN), JSW
GRASIM IN Equity 2438.0 0.1 6.3 8.3
Steel (JSTL IN), NTPC (NATP IN), Jindal Power & Steel (JSP IN), Hindalco (HNDL IN) & Worst performers
21 other firms for their failure to make required progress several years after IVRC IN Equity 72.9 0.3 (2.5) (42.5)
allotment. (ECNT) UT IN Equity 37.9 (1.2) 11.0 (39.5)
RECL IN Equity 223.0 (2.7) (5.8) (28.5)
` The govt. cleared a bill to empower itself to effectively manage the affairs of
UNSP IN Equity 1042.7 (2.5) (12.3) (27.6)
subsidiary banks of SBI (SBIN IN). The move will also help facilitate the merger of five POWF IN Equity 234.7 (0.2) (3.7) (26.8)
subsidiaries with SBI, for which the govt. has indicated a timeframe of 12-18 months
(TTOI)
` Bank of India's (BOI IN) shareholders had approved capital infusion of over USD
222.22mn from the govt. by way of preferential issue of shares. (BSTD)
` United Bank of India (UNTDB IN) is expecting the govt. to infuse USD 68.44 by the
end of this month. (BSTD)
` Qualcomm is in talks with Bharti Airtel (BHARTI IN) to sell its broadband wireless
access licences in India. (BSTD)
` RCom (RCOM IN) has drawn the first tranche of USD 666.66mn of the USD 1.93bn
loan facility it had signed with China Development Bank. (BSTD)
` Siemens (SIEM IN) seeks RBI nod for its non-banking financial services arm to start
operations in the country. (BSTD)
Source: ECNT= Economic Times, BSTD = Business Standard, FNLE = Financial Express, THBL = Business Line.
For Private Circulation Only. FOR IMPORTANT INFORMATION ABOUT KOTAK SECURITIES’ RATING SYSTEM AND OTHER DISCLOSURES.
REFER TO THE END OF THIS MATERIAL.
NEUTRAL
Energy
India MARCH 18, 2011
UPDATE
BSE-30: 18,150
Oil on the boil will make India toil. Ongoing social and political unrest in the MENA
region may keep crude oil prices high despite ample OPEC spare capacity (on paper)
and weakening global fundamentals. India faces a Hobson’s choice between (1) higher
subsidies and government borrowing and (2) higher inflation. In reality, we will see
both. We rule out a sustained improvement in refining margins given significant new
capacity additions and continued global over-supply.
Crude prices: Predictions are meaningless in the current scenario
Crude oil prices may sustain at current high levels if social and political unrest in MENA sustains
and/or escalates further despite (1) ample OPEC spare capacity (on paper) and (2) nascent signs of
global tightening and slowdown in consumption of other commodities. OPEC’s spare capacity may
get strained if the ongoing social unrest in Libya escalates further and spreads to other oil-rich
countries in the MENA region.
Crude prices: Pain is for real for India; higher government borrowing and inflation
Given India’s social and political constraints and haphazard pricing system, we see limited pass-
through of the increase in global oil prices to Indian consumers. Five state elections in 1QFY12E
and sticky inflation through 1HFY12E (even without considering higher fuel prices) may preclude
any meaningful price increase. (1) The government may have to ultimately borrow more, which
may push up interest rates in the system. (2) Periodic small price increases, if implemented,
through FY2012E may keep inflation above 7% through FY2012E.
Refining margins: Expectations seem to have run ahead of fundamentals
We expect supply-demand imbalance to remain through CY2011-12E as incremental global

refining capacity of 3.1 mn b/d and NGL supply of 1 mn b/d will likely exceed incremental demand
of 2.5-2.7 mn b/d over the same period. Refining margins have been strong of late given crude
price volatility and dislocations and low capacity utilization in the US; reported margins may also
benefit from adventitious gains in the short term.
Stock view: ONGC, OIL look good despite their limited upside to crude prices
ONGC and OIL have a moderately positive leverage to crude oil prices since they sell sufficient
crude oil and value-added products to offset the impact of higher subsidies under the current
subsidy-sharing system. Cairn has high leverage to crude oil prices but uncertainty on the royalty
issue may act as an overhang in the short term while normalized long-term crude oil prices of
US$80-90/bbl result in `290-`330 fair valuation for Cairn stock. RIL has little leverage to crude oil
prices. Earnings of BPCL, HPCL and IOCL are impossible to forecast without a proper pricing
system but the stocks seem to be discounting a rather bad situation in perpetuity.
For private Circulation Only. FOR IMPORTANT INFORMATION ABOUT KOTAK SECURITIES’ RATING SYSTEM AND OTHER DISCLOSURES, REFER TO THE END OF THIS MATERIAL.
ADD
Sun Pharmaceuticals (SUNP)
Pharmaceuticals MARCH 17, 2011
UPDATE
Coverage view: Cautious
Multiple triggers present upside to our FY2012E EPS. We believe likely launch of Price (Rs): 435
four key products in FY2012/13E will present an upside to our EPS of Rs19.7. Unlike Target price (Rs): 480
street expectations, we reiterate there is no 30-month stay for Taxotere and retain our
BSE-30: 18,150
assumption of a mid-FY2012E launch. In addition, transaction documents prepared by
William Blair (advisor to Caraco) suggest strong US sales in FY2012E (estimates as per
Caraco management) with (1) FY2012E Caraco sales estimates at US$268 mn, 7%
higher than our estimate, and (2) gradual recovery in sales from Caraco plant with
FY2012E sales at US$37 mn versus US$23 mn in FY2011E despite delay in resumption
of manufacturing. Maintain ADD, PT: Rs480.
Company data and valuation summary QUICK NUMBERS

Sun Pharmaceuticals
Stock data Forecasts/Valuations 2011 2012E 2013E • Unlike street
52-week range (Rs) (high,low) 512-302 EPS (Rs) 17.4 19.7 24.1
expectations, we
Market Cap. (Rs bn) 450.8 EPS growth (%) 33.4 13.1 22.6
Shareholding pattern (%) P/E (X) 25.0 22.1 18.0 reiterate there is no
Promoters 63.7 Sales (Rs bn) 58.3 74.5 86.9 30-month stay for
FIIs 19.0 Net profits (Rs bn) 18.0 20.4 25.0 Taxotere
MFs 2.9 EBITDA (Rs bn) 21.6 25.4 30.2
EV/EBITDA (X) 19.2 15.9 12.8
Price performance (%) 1M 3M 12M • Documents
Absolute 2.6 (3.3) 29.0 ROE (%) 21.0 19.9 20.5
Rel. to BSE-30 4.6 5.9 24.3 Div. Yield (%) 0.6 0.6 0.6 prepared by William
Blair (advisor to
Caraco) suggest
Taxotere (US$1.2 bn drug)—limited competition product, launch imminent
strong US sales in
Five companies have filed ANDAs till date with Accord filing in early January 2011. We think FY2012E (estimates
Hospira may enjoy some lead post launch in end-March 2011; however, SUN’s approval should as per Caraco
follow shortly after. Unlike street expectations of 30-month stay blocking SUN’s Taxotere till management)
January 2012E, we reiterate there is no 30-month stay and retain our assumption of a mid-
FY2012E launch. While Hospira’s formulation is a single vial version, in line with branded product
which Sanofi has successfully converted to single vial, we believe with right pricing SUN should
garner meaningful sales in light of no additional competition likely in 2011E. We include US$70
mn sales in FY2012E (25% market share, 45% price erosion) for Taxotere.
Update on 3 other key products, launch date uncertain (hence not included in our FY2012E EPS)
We provide an update on three other products likely to be launched in FY2012/13E (1) Eloxatin:
On February 16, 2011, District Court of New Jersey issued an injunction preventing launch
by SUN till the court resolves all issues pertaining to settlement agreement. We believe launch by
SUNP is not likely until court decision/settlement is concluded, (2) Prandin: Latest Caraco filing
confirms this product site has been transferred from Caraco facility, we believe there is no
30-month stay and SUN may launch at risk. However, we await final approval before including
in our estimates (US$180 mn sales, SUN likely only filer), (3) Strattera: Eli Lilly had appealed the
lower court verdict, subsequently the Appeals court hearing was completed in December
2010. Even though SUN along with other generics have received final approval, the Appeals court
has granted an injunction that prevents the launch of generics until a ruling is rendered. We await
ruling and believe SUN will enjoy shared exclusivity along with 5-7 other companies.
Pharmaceuticals Sun Pharmaceuticals
William Blair documents give FY2012E sales estimates for Caraco as US$268 mn,
7% higher than our estimate
In December 2010, Caraco retained William Blair as an independent advisor to consideration
of Sun Pharma proposal to taking Caraco private which has since been concluded. Read-
through from the documents prepared by William Blair which contains sales estimates by
Caraco management and was presented to the Caraco board for consideration of SUN’s
proposal suggests:
(1) FY2011/12E sales estimates for Caraco are US$307 (in line with our estimate) and
US$268 mn, (7% higher than our estimate), possibly reflecting impact of higher
Taxotere sales.
(2) Gradual recovery in sales from Caraco plant with FY2012E sales at US$37 mn
versus US$23 mn in FY2011E, despite delay in resumption of manufacturing at the
plant.
Break-up of profits (Rs mn)
FY2010 FY2011E FY2012E FY2013E

Revenues
Base 34,629 39,425 52,329 61,101
Exclusive 6,132 9,261 — —
Taro — 9,651 22,199 25,761
Total 40,761 58,337 74,529 86,862
EBITDA
Base 9,185 10,917 18,744 22,177
Exclusive 4,906 6,946 — —
Taro — 1,946 4,884 6,183
Total 14,091 19,810 23,628 28,360
EBITDA, %
Base 26.5 27.7 35.8 36.3
Exclusive 80.0 75.0
Taro 20.2 22.0 24.0
Total 35 34 32 33
PAT
Base 9,256 12,009 20,395 25,007
Exclusive 4,280 5,951 — —
Total 13,536 17,959 20,395 25,007
EPS Rs
Base 8.7 11.1 19.0 22.8
Exclusive 4.1 5.7 — —
Interest income 0.2 0.4 0.7 1.3
Total 13.1 17.3 19.7 24.1
Source: Kotak Institutional Equities estimates, Company
4 KOTAK INSTITUTIONAL EQUITIES RESEARCH

Sun Pharmaceuticals Pharmaceuticals
Profit and loss statement, March fiscal year-ends, 2008-2013E
2008 2009 2010 2011E 2012E 2013E

Net sales 33,565 42,723 40,761 58,337 74,529 86,862
Materials (7,222) (8,556) (10,978) (15,425) (21,857) (24,931)
Selling and administration (3,759) (5,543) (6,317) (9,083) (10,942) (12,621)
Employee cost (2,331) (3,401) (4,822) (7,942) (9,531) (10,961)
R& D (2,725) (3,099) (2,472) (3,053) (4,844) (5,646)
Others (2,017) (3,484) (2,810) (2,917) (3,726) (4,343)
Total expenditure (18,054) (24,084) (27,400) (38,420) (50,901) (58,502)
EBITDA 15,511 18,640 13,362 19,917 23,628 28,360
Depreciation and amortisation (969) (1,233) (1,533) (2,209) (2,650) (2,750)
EBIT 14,543 17,407 11,829 17,708 20,978 25,610
Net finance cost (88) — — — — —
Other income 1,539 2,085 2,320 2,219 2,600 3,300
Pretax profits before extra-ord 15,994 19,492 14,148 19,927 23,578 28,910
Current tax (1,288) (1,192) (679) (1,370) (2,004) (2,457)
Deferred tax 804 481 0 0 0 0
Reported net profit 15,509 18,780 13,470 18,558 21,574 26,453
Minority Interests 640 603 (41) 533 1,179 1,446
Reported net profit after mino 14,869 18,177 13,511 18,025 20,395 25,007
Balance sheet, cash model, March fiscal year-ends, 2008-2013E
2008 2009 2010 2011E 2012E 2013E

Balance sheet
Total equity 49,915 70,449 78,289 93,518 111,117 133,328
Total debt 1,436 1,789 1,712 7,212 7,212 7,212
Current liabilities 6,373 7,198 7,579 7,410 8,011 8,013
Minority Interests 1,886 1,970 1,932 2,465 3,644 5,089
Deferred tax liabilities 92 (679) (890) (890) (890) (890)
Total equity and liabilities 59,701 80,728 88,621 109,714 129,093 152,752
Cash and cash equivalents 12,389 16,690 6,073 11,417 22,908 40,787
Current assets 26,983 25,993 31,048 42,006 51,044 58,074
Net fixed assets 10,354 14,625 15,328 20,119 18,969 17,719
Intangible assets 1,729 3,253 4,060 4,060 4,060 4,060
Capital -WIP 686 1,571 1,448 1,448 1,448 1,448
Investments 7,560 18,595 30,664 30,664 30,664 30,664
Total assets 59,701 80,728 88,621 109,714 129,093 152,752
Free cash flow

Operating cash flow, excl. work 15,198 18,841 14,749 20,301 23,492 27,830
Working capital (7,183) 1,113 (4,702) (10,533) (7,258) (5,582)
Capital expenditure (1,787) (6,401) (1,742) (1,500) (1,500) (1,500)
Investments (5,017) (11,035) (12,069) — — —
Free cash flow 1,210 2,519 (3,763) 8,267 14,735 20,748
KOTAK INSTITUTIONAL EQUITIES RESEARCH 5

REDUCE
Nestle India (NEST)
Consumer products MARCH 17, 2011
UPDATE
Coverage view: Cautious
Analyst meet takeaways. Nestle indicated that it operates with margins in a band Price (Rs): 3,564
(EBITDA of 19-21%, in our view) and CY2011E margins could decline due to input cost Target price (Rs): 3,100
inflation (coffee, milk, palm oil) and impact of incremental 1% excise duty (which is
BSE-30: 18,150
potentially a precursor to a higher rate under GST). Nestle is nervous to face
competition in noodles category (particularly ITC), in our view. At 35X FY2012E, there is
no room for execution risk. We like the market opportunity for most of Nestlé’s
categories, but look for better entry points into the stock.
Company data and valuation summary

Nestle India (a)
Stock data Forecasts/Valuations 2011 2012E 2013E
52-week range (Rs) (high,low) 4,224-2,295 EPS (Rs) 87.0 104.1 126.2
Market Cap. (Rs bn) 343.7 EPS growth (%) 17.0 19.6 21.2
Shareholding pattern (%) P/E (X) 40.9 34.2 28.3
Promoters 62.8 Sales (Rs bn) 62.5 75.4 89.9
FIIs 10.7 Net profits (Rs bn) 8.4 10.0 12.2
MFs 2.2 EBITDA (Rs bn) 12.6 15.5 19.0
Price performance (%) 1M 3M 12M EV/EBITDA (X) 27.1 22.2 18.1
Absolute 3.6 (0.1) 33.1 ROE (%) 129.6 124.8 121.2
Rel. to BSE-30 5.6 9.4 28.2 Div. Yield (%) 1.7 2.0 2.5
Key takeaways from analyst meet
` CY2011E is likely a challenging year in Nestlé’s view. It says that the company operates margins
in a band (EBITDA of 19-21%, in our view) and CY2011E margins could decline due to input
cost inflation (coffee, milk, palm oil) and impact of incremental excise duty. According to the
company, the imposition of 1% excise duty could potentially impact CY2011E EBITDA margins
by 50 bps, if it is not passed on.
` Capex: It outlined capacity expansion plans, (1) new greenfield plant in Tahliwal, Himachal
Pradesh for noodles and chocolates, (2) expansion of dairy capacity in Moga, (3) doubling
noodles capacity in Samalkha, (4) adding a new noodles line in Bicholim, (5) expansion of
Nanjangud facility to include noodle line as well, and (6) addition of a pasta line in Pantnagar.
The company is planning to invest ~Rs25 bn over CY2011-13E, in our view.
` Company added 464,000 new outlets in its coverage (which is a 15% growth, in our view). We
recall that Nestle is working on increasing the distribution coverage to 5 mn outlets from 3 mn
outlets over CY2009-14E.
` The company indicated its intention to focus on premiumisation in most categories—chocolates

and dairy, in our view.
` The Pantnagar facility (accounting for ~10-15% of throughput, in our view) is entering the sixth
year of operations (only 30% of profits will be exempt compared with 100% earlier) and hence
the effective income tax rate could increase by ~200 bps in CY2011E.
` Bringing of various food products (noodles, pasta, soups etc.) into tax net with 1% excise duty
is a precursor to a potentially higher rate under GST, in our view.
` The company has received RBI approval for raising US$450 mn ECB from foreign equity holders.
It is likely to raise this in tranches over CY2011-13E as a loan from parent, in our view.
Nestle India Consumer products
Nestle is nervous to face competition in noodles category, in our view

We continue to believe that Maggi faces product substitution risk (from Foodles, Knorr and
Yippie). However, the spate of new launches in Maggi (four new variants) indicates that
competition seems to have triggered higher activity levels in the industry, led by the market
leader. We note that this can potentially help Maggi maintain its current growth rates by
increasing the consumption points.
However, we are surprised at the company’s aggression in the analyst meet regarding
competitive activity in the noodles category. It commented that the company has not lost
market shares and that many of the newer entrants are probably not long-term players in
the category.
At 35X FY2012E, there is no room for execution risk. Retain REDUCE

We like the market opportunity for most of Nestlé’s categories, but look for better entry
points into the stock. We maintain estimates and REDUCE rating with TP of Rs3,100. Key
risks to our rating are (1) higher-than-expected sales growth due to distribution gains and (2)
better than-expected margin expansion.
Nestle has never had to face severe competition in its categories

Nestlé’s market share and market status, category-wise
Market share (%)

Nearest Market
Category Nestle competitor status Remarks
Nutrition / Infant food ~90 ~5 Monopoly High entry barriers as advertising is banned
Culinary / Maggi ~90 ~5 Monopoly Nestle has done a good job in category creation
Beverages / Coffee 55 45 Duopoly Duopoly with HUL
Chocolates and confectionary 25 70 Duopoly Nestle dominates the wafer segment
Note:
(a) Market shares are approximations as per industry sources
Source: Kotak Institutional Equities

Consumer products Nestle India
Nestle: Profit model, balance sheet, 2006-2012E, December calendar year-ends (Rs mn)
2006 2007 2008 2009 2010E 2011E 2012E

Profit model (Rs mn)
Net sales 28,161 35,043 43,242 51,294 62,547 75,373 89,870
EBITDA 5,385 6,962 8,638 10,542 12,507 15,339 18,793
Other income 202 246 322 364 427 255 305
Depreciation (663) (747) (924) (1,113) (1,278) (1,857) (2,478)
Pretax profits 4,923 6,461 8,036 9,793 11,656 13,738 16,620
Tax (1,654) (2,148) (2,387) (2,620) (3,264) (3,699) (4,457)
Net profits 3,269 4,313 5,649 7,173 8,392 10,039 12,163
Earnings per share (Rs) 33.9 44.7 58.6 74.4 87.0 104.1 126.2
Balance sheet (Rs mn)

Total equity 3,889 4,184 4,733 5,813 7,140 8,945 11,131
Total borrowings 163 29 8 6 6 6 6
Currrent liabilities and provsions 8,726 9,865 12,208 14,538 16,922 19,989 23,845
Total liabilities and equity 12,777 14,078 16,950 20,356 24,069 28,940 34,982
Cash 2,387 1,322 2,286 3,588 3,400 1,952 1,922
Current assets 4,590 6,001 6,043 7,010 7,773 6,949 7,499
Total fixed assets 5,800 6,755 8,622 9,758 12,895 20,039 25,561
Total assets 12,777 14,078 16,950 20,356 24,069 28,940 34,982
Free cash flow (Rs mn)

Operating cash flow, excl. working c 3,561 4,363 5,568 7,065 8,487 10,699 13,192
Working capital 561 361 1,149 1,355 1,258 3,542 2,857
Capital expenditure (1,497) (1,702) (2,790) (2,249) (4,414) (9,000) (8,000)
Free cash flow 2,624 3,022 3,927 6,170 5,330 5,241 8,048
Key assumptions
Revenue Growth (%) 13.7 24.4 23.4 18.6 21.9 20.5 19.2
EBITDA Margin(%) 19.1 19.9 20.0 20.6 20.0 20.4 20.9
EPS Growth (%) (0.7) 31.9 31.0 27.0 17.0 19.6 21.2
Source: Kotak Institutional Equities estimates

BUY
United Phosphorus (UNTP)
Others MARCH 17, 2011
UPDATE
Coverage view: Attractive
MAI confirms positive outlook for 1QCY11E. Analysis of Makheteshim (MAI) annual Price (Rs): 136
results confirms trends reported by UPL YTD: (1) ROW markets remain key sales growth Target price (Rs): 220
driver in 2010 with tepid growth in EU/NA, (2) Brazil market underperforms reporting
BSE-30: 18,150
volume/price decline for MAI, (3) selling price declined in CY2010 with most of it seen
in 1HCY10, (4) Europe underperforms for UPL, although up 3% for MAI, and (5) low
inventories, favorable weather, positive trend for price/volume are likely to result in
strong 1QCY11E. We believe turnaround in Europe in 4QFY11E is key to UPL meeting
its FY2011E sales guidance of 5%. Maintain BUY with TP of Rs220.
Company data and valuation summary

United Phosphorus QUICK NUMBERS
Stock data Forecasts/Valuations 2011 2012E 2013E
52-week range (Rs) (high,low) 220-125 EPS (Rs) 12.9 17.6 20.7 • MAI confirms
Market Cap. (Rs bn) 62.7 EPS growth (%) 8.3 37.3 17.1 positive outlook for
Shareholding pattern (%) P/E (X) 10.5 7.7 6.6
Promoters 26.5 Sales (Rs bn) 57.2 63.8 70.0
1QCY11E
FIIs 35.6 Net profits (Rs bn) 5.9 8.2 9.6
MFs 11.3 EBITDA (Rs bn) 10.8 13.1 14.4 • Europe
Price performance (%) 1M 3M 12M EV/EBITDA (X) 5.7 4.3 3.5 underperforms for
Absolute (5.6) (15.8) (14.5) ROE (%) 17.5 19.4 19.1 UPL, although up
Rel. to BSE-30 (3.8) (7.8) (17.6) Div. Yield (%) 1.4 1.5 1.8
3% for MAI
Analysis of MAI annual results confirms trends reported by UPL • Brazil market
underperforms in
Analysis of Makheteshim, # 1 global generic agchem company, annual results confirms the trends CY2010
reported by UPL YTD, namely:
(1) Selling price declined in CY2010. MAI reported decline in average selling price in CY2010 of
5% in line with decline of 4% for UPL over comparative 12 months ending December 2010. MAI
has reported yoy decline in average selling price in CY2010 in all geographies and as per MAI’s
results call, majority of the pricing decline was witnessed in 1HCY10, in line with trend seen in UPL.
UPL reported pricing decline of 7% in 1HCY10 versus 3% in 2HCY10. In 4QCY10, MAI reported
pricing decline of 5% versus UPL’s 3% and volume growth of 8% versus UPL’s 15%.
(2) MAI/UPL reported double-digit volume growth in CY2010. MAI reported volume growth
of 12%, in line with UPL’s 13% in CY2010. MAI reported volume growth across all geographies
except Brazil where UPL has minimal presence currently. However, MAI has reported volume
growth in Europe in CY2010. This, we believe, is contrary to UPL’s European sales which we
believe has not reported volume growth in 12 months ending December 2010.
(3) Tepid growth in North America in dollar terms at 0.5%, lower than UPL’s 3% due to
volume gains being offset by pricing decline.
(4) Europe underperforms for UPL. Europe turns around for MAI with 9%/3% growth in dollar
terms in 4Q/CY2010 versus UPL’s sales decline of 20%/15%. We believe the sales growth for MAI
in Europe versus sales decline for UPL could be due to new operations started in Eastern Europe by
MAI and volume decline in Europe for UPL. UPL does not provide volume/price break-up by
geographies.
(5) ROW markets (excluding Brazil) continue to be strong sales driver in 2010 for agchem
companies, with sales growth at 48% in dollar terms for MAI versus 33% for UPL.
Others United Phosphorus
Comparison of sales growth in CY2010 (%)
MAI UPL
Price growth (5) (4)
Volume growth 12 13
Exchange rate (5)
Total sales 7 4
Sales growth in US$ (%)

Europe 3 (15)
NA 1 3
Asia Pacific 48
Latin America (0) 33
Home market 3 24
Total sales 7 4
Recovery underway with price recovery likely in 1QCY11; we model flat pricing
Agchem companies such as MAI, UPL witnessed yoy decline in average selling price in
CY2010. This led to lower sales growth in single digit for both MAI (7%) and UPL (4%) with
both reporting average pricing decline of 5% and 4%, respectively. Volume growth for MAI
and UPL was at 12% and 13%.
MAI management comments from their results call indicate strong recovery in agchem
market. Favorable market conditions marked by (1) low inventories, (2) favorable weather in
NA/EU and (3) high crop prices are likely to result in positive trend for price/volume in
1QCY11E, according to the comments made during the results call.
According to the MAI management, the market is witnessing better pricing discipline and
there has been revival in prices in certain markets with strong recovery seen in Latin America
and others which had witnessed rock bottom prices in 2010.
We believe turnaround in Europe in 4QFY11E is key to UPL meeting its FY2011E sales
guidance of 5%. According to our discussions with the company, outlook for Europe
remains solid which is likely to result in a strong 4QFY11E. We model volume growth of
17%, up 2% qoq with flat pricing in 4QFY11E (see below).
Components of sales growth, FY2009-FY2011E, (%)
Price Volume Exchange rate

40 37
8
30
14 16
20 10 7
1 (1)
10 17
15 14 15
8
0 (3) 0
(1)
(5) (4)
(5) (5)
(10)
(20)
FY2009 FY2010 1HFY11 3QFY11 4QFY11E

United Phosphorus Others
Sales growth by geography, (%)
FY2010 1QFY11 2QFY11 3QFY11 4QFY11E FY2011E FY2012E

India 16 10 45 6 10 18 17
International 9 (15) (2) 8 17 2 10
North America 5 (12) (7) (4) 19 (1) 8
Europe (1) (25) (25) (24) 10 (13) 4
Rest of the World 26 (6) 23 36 24 20 15
Total (incl other income) 10 (10) 10 8 16 5 12
Brazil underperforms in 2010; UPL enters Brazil through recent acquisition

The underperformance was due to (1) decline in sales volume. For MAI, Brazil remained the
only geography to report volume decline in CY2010 on account of rapid decline in market
share. MAI has been witnessing decline in market share in Brazil since 2006, and (2) severe
decline in selling prices.
While UPL’s sales are minimal from Brazil, UPL recently acquired 50% stake in Sipcam Isagro
Brazil (SIB), which we believe will add US$65 mn sales to its top line in FY2012E.
We view this acquisition as marginally positive as (1) it provides UPL entry into the high-
growth Brazilian market although it adds only 5% to its top line, and (2) we believe
acquisition cost is reasonable (<6 EV/EBITDA).
However, risks remain as acquisition is (1) margin dilutive—SIB reported 17% EBITDA margin
in CY2008 versus UPL’s 19% in 9MFY11, (2) receivable cycle in Brazil is longer (>200 days),
and (3) SIB has significant debt, mainly for working capital (3X debt/EBITDA).
Sipcam Isagro Brazil (50% share of Isagro), (Euro mn)
9M2010 2009 2008

qualititave comments indicating
performance of JV in 2010
Revenues 41 46
EBITDA 1 8
EBITDA, % recovery of margin in Brazilian JV 2 17

Amortisation 1 1
higher financial charges for Sipcam

Isagro Brasil S.A., which by itself
paid interests and commissions of
Euro 4.8 mn + 9M2010 witnessed
Net financial charges lengthening payments terms 5 4
PBT (5) 3
Tax (2) 1
PAT (3) 2

Others United Phosphorus
UPL—profit and loss statement, March fiscal year-ends, 2008-2013E (Rs mn)
2008 2009 2010 2011E 2012E 2013E

Net sales 35,155 48,021 52,900 57,211 63,807 69,972
Operating expenses
Materials (18,146) (24,512) (29,542) (28,700) (31,660) (34,341)
Selling and administration (4,927) (6,161) (6,387) (7,437) (8,295) (9,096)
Employee cost (4,017) (4,794) (5,018) (5,117) (5,316) (5,848)
R&D (90) (306) (310) (286) (319) (350)
Others (3,071) (3,806) (3,356) (4,325) (5,105) (5,948)
Total expenditure (30,250) (39,578) (44,612) (45,866) (50,695) (55,583)
EBITDA 4,905 8,444 8,288 11,346 13,112 14,389
Depreciation and amortisation (1,522) (1,927) (2,147) (2,002) (2,225) (2,350)
EBIT 3,383 6,517 6,141 9,343 10,887 12,039
Net finance cost (1,688) (1,761) (1,825) (2,179) (2,150) (1,700)
Other income 2,462 265 1,932 (34) 1,000 1,000
Pretax profits before extra-ordinaries 4,156 5,021 6,249 7,131 9,737 11,339
Current tax (141) (263) (408) (1,189) (1,655) (1,928)
Deferred tax (263) 19 (442) — — —
Fringe benefit tax (20) (31) — — — —
Reported net profit 3,733 4,747 5,399 5,942 8,082 9,411
(Profit)/loss in minority interest (10) (25) (59) — — —
Share of profit/(loss) in associate 222 200 188 4 80 150
Prior adjustments (net) (226) (268) (35) — — —
Reported net profit after minority interes 3,719 4,654 5,492 5,946 8,162 9,561
Exceptional items (1,144) (95) (231) — — —
Reported net profit after minority interes 2,575 4,559 5,262 5,946 8,162 9,561
UPL—balance sheet statement, March fiscal year-ends, 2008-2013E (Rs mn)
2008 2009 2010 2011E 2012E 2013E

Balance sheet
Net worth 22,380 26,730 29,918 38,036 45,133 53,362
Debt 15,683 20,665 23,818 22,326 18,002 15,207
Current liabilities 13,473 16,260 14,616 15,070 18,105 21,667
Minority Interests 60 95 140 140 140 140
Deferred payment liabilities 862 677 375 375 375 375
Deferred tax liabilities 254 338 780 780 780 780
Total equity and liabilities 52,711 64,765 69,648 76,728 82,534 91,532
Cash and cash equivalents 8,446 5,539 15,778 17,000 17,000 20,000
Current assets 23,635 35,635 27,465 33,325 39,356 45,704
Net assets incl intangibles 15,993 18,494 18,128 18,126 17,901 17,551
Investments 4,070 4,332 7,612 7,612 7,612 7,612
Deferred tax asset 563 765 665 665 665 665
Misc. expenditure 5 — — — — —
Total assets 52,711 64,765 69,648 76,728 82,534 91,532
Free cash flow
Operating cash flow, excl. w. capital 6,553 8,018 8,863 9,312 11,261 12,342
Working capital (2,615) (9,471) 6,273 (5,420) (3,024) (3,051)
Capital expenditure 2,827 (3,620) 427 (2,000) (2,000) (2,000)
Investments (159) (268) 286 — — —
Free cash flow 6,607 (5,340) 15,849 1,893 6,237 7,291

Economy.dot
INDIA
Economy
Monetary Policy MARCH 17, 2011
UPDATE
BSE-30: 18,150
RBI Credit Policy: Inflation rules the roost. The RBI during today’s mid-quarter
meeting decided to raise repo and reverse repo rates by 25 bps each citing reasons of
demand-side pressures in the economy. The policy maintains its anti-inflationary bias as
inflation has continued to surprise on the upside. In a bid to control expectations, the
RBI stressed the necessity to maintain a calibrated approach to the rate hike cycle.
CRR and SLR rates were kept unchanged at 6% and 24%, respectively.
Inflation has started showing demand-side pressures; end-FY2011E estimate of RBI raised to 8%
The RBI acknowledged that food articles inflation has softened but protein-rich items inflation
continue to be high. Also, non-food manufactured products inflation in February rose sharply
QUICK NUMBERS
indicating demand-side pressures in the economy. The acceleration of inflation across the
manufacturing sectors indicates that pricing power is present in the economy. Concerns remain on
• Repo and reverse
the impact of the high international crude prices on petroleum products and non-food
repo rates raised by
manufactured products. From its earlier estimate of end-FY2011E inflation at 7%, the RBI raised
25 bps each to
the estimate to 8%. We now see the end-March 2011 inflation number at 8.20%. Inflation is also
6.75% and 5.75%;
expected to remain sticky and hover around the 7.5% mark in 1HFY12E, prompting further policy
actions from RBI. The policy communiqué lauded the Union Budget on the efforts to raise CRR and SLR
agricultural productivity and ease demand-side pressures but remained concerned on the subsidies unchanged
front. In line with what we have been highlighting, the RBI opines that focus should be on ‘quality
• March inflation now
of expenditure’ whereby the aggregate is under control without compromising on ’delivery of
expected at 8%
services‘. This balance is essential in demand-side inflation management.
Growth not an immediate concern; we expect FY2012E to see some moderation • Expect to see rate
hiked by 50-75 bps
The scenario in the US and Euro Area has started showing optimism in terms of starting to gain in FY2012E
growth momentum. On the situation of Japan, the RBI views that the macroeconomic impact is
too early to assess but further upside to crude prices may come from the shift of Japan to thermal
energy from nuclear energy. The RBI sounded comfortable with domestic growth scenario as
agricultural production is likely to be strong as indicated by rabi crop sowing along with other
indicators like PMI, direct, indirect taxes and credit growth. We believe that though FY2011E
growth might not be a concern, a moderation in growth is likely in FY2012E. This might be a
deterrent for RBI in terms of aggressive rate hikes. Along with a cyclical moderation, dampening in
the investment situation may also come from high commodity prices. As highlighted by the RBI,
the weak performance of capital goods may be indicative of slowing investment momentum.
Liquidity to be at a comfortable level; reining in inflation expectations primary aim of RBI
The RBI expects liquidity to move towards its comfort level of (+/-)1% of NDTL with temporary
imbalances coming from the advance tax collections. Decline in government cash balances with
the RBI has further eased the liquidity pressures. The main aim of the RBI will be to rein in
demand-side pressures without affecting growth and managing inflationary expectations and
containing spillover of food and commodity price inflation into more generalized inflation.
RBI to stay hawkish; likely to continue with hikes of 25 bps
We believe that the RBI will continue to focus on inflation and maintain its rate hiking cycle of
doses of 25 bps each. We expect the RBI to raise the repo and reverse repo rates by 50-75 bps
more from the current levels of 6.75% and 5.75%, respectively. RBI has removed the term
’calibrated increases‘ in this document. Our assessment is that RBI could stick to the 25 bps dose
unless there is any run-away pressure on inflation as the document also makes it clear that some
“risks to growth are emerging”.
For private Circulation Only.

India Economy
Expect another 50-75 bps hike in policy rates

Repo rate, reverse repo rate and CRR, 2001-2012E, (%)
11 Reverse repo rate Repo rate CRR
10
3
Jan-01
Aug-01
Mar-02
Oct-02
Jul-04
Feb-05
Sep-05
Apr-06
Jan-08
Aug-08
Mar-09
Oct-09
Jul-11
Feb-12
May-03
Nov-06
Jun-07
May-10
Dec-03
Dec-10
Source: RBI, Kotak Economic Research estimates
Inflation likely to remain around 7.5% in 1HFY12E

Change in WPI, 2006-2012E, (y/y, %)
12 WPI Inflation
10
0
Apr-06
Aug-06
Apr-07
Aug-07
Apr-08
Aug-08
Apr-09
Aug-09
Apr-10
Aug-10
Apr-11
Aug-11
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10
Dec-11
(2)
Source: CMIE, Kotak Economic Research estimates
14 KOTAK ECONOMIC RESEARCH

Economy India
Non-food credit at 23% continues to outstrip deposit growth at 16%

Growth in non-food credit and deposits, 2007-2011, (y/y, %)
35
aggregate deposits non-food credit
30
25
20
15
10
5
Apr-07
Aug-07
Apr-08
Aug-08
Apr-09
Aug-09
Apr-10
Aug-10
Dec-07
Dec-08
Dec-09
Dec-10
Source: CMIE, Kotak Economic Research estimates
KOTAK ECONOMIC RESEARCH 15

CAUTIOUS
Telecom
India MARCH 17, 2011
UPDATE
BSE-30: 18,150
Feb GSM SIM net adds – strong growth and solid show from incumbents. India’s
GSM operators (excluding RCOM and TTSL) added a net 14.7 mn SIMs in the month of
Feb 2011 versus 13.7 mn in Jan. Bharti, Idea and Vodafone continued their solid
growth, together accounting for 63% of net adds. Nevertheless, these are SIM net adds
and the absolute numbers bear little meaning – market share and trends do, of course.
Bharti and Idea are on track to meet our end-March 2011E SIM base estimates.
Feb 2011 GSM SIM net adds – strong growth continues
` GSM operators, excluding RCOM and TTSL, added a net 14.7 mn SIMs in Feb 2011, an uptick
from 13.7 mn reported in Jan 2011. Uptick was driven primarily by the swing in Videocon’s net
adds – from a negative 1.3 mn in Jan to a positive 0.55 mn in Feb.
` Circle-wise net adds distribution remained steady – Metros (10%), A circles (35%), B circles
(40%) and C circles (15%).
` Player-wise performance suggests another strong month for the incumbents. Bharti’s net adds
remained steady at 3.2 mn versus 3.3 mn in Jan, Idea’s were flat at 2.5 mn, while Vodafone’s
surged to 3.6 mn from 3.1 mn in the previous month. The top-3 GSM operators accounted for
63% of the net adds. Net adds slowed down for BSNL (to 1.5 mn from 2.2 mn in Jan and an
average of 2.9 mn in the Dec 2010 quarter), and Uninor (to 1.3 mn from 1.8 mn in Jan and an
average of 2.4 mn in the Dec 2010 quarter). Other players’ net adds were steady mom.
` Slowdown in net adds for some players could be driven by aggressive churning rather than just
a slowdown in gross adds. The TRAI has started reporting VLR data periodically which suggests
a poor active subs proportion for players other than Bharti, Idea and Vodafone. We discuss the
latest VLR data in brief in the next paragraph.
Jan 2011 VLR data – key interpretations
The TRAI has started reporting the peak Visitor Location Register (VLR) subs data for the past few
months. VLR subs essentially represent the number of SIMs connected to one of the wireless
networks in India at a point in time. Given the multi-SIM phenomenon in the country, VLR data is
the closest proxy that one has to the unique subs base (548 mn at end-Jan 2011) in the country.
The latest two months’ (Dec 2010 and Jan 2011) VLR subs data player-wise is depicted in Exhibit
2, while Exhibit 3 depicts the player-wise, circle-wise data for Jan 2011. A few observations
` Bharti (92.6%) and Idea had the highest VLR-to-reported subs ratio in Jan 2011. The high VLR
ratio for these companies demonstrates several things, the most important ones being (1)
superior quality subs reporting and churn norms of the two companies, (2) superior network
coverage, and (3) higher primary SIM status; the secondary SIM (of other operators) is possibly
activated only to make outgoing calls, at certain points in a day.
` On the flip side, the VLR-ratio adjusted underlying ARPU (on active subs) for other operators is
much higher than their reported numbers suggest. Essentially, the ARPU differential of a Bharti
versus others in the industry may not be as high as ARPU computed on reported subs would
suggest (Exhibit 4). This also means that the differential in revenue market share and subs
market share for Bharti is not as high as is normally perceived – Bharti had a Dec 2010 quarter
RMS of 29.2%, Dec 2010 reported subs market share of 20.3%, and VLR subs share of 26.2%.
Telecom India
Exhibit 1: Subscriber details for leading GSM cellular operators, ('000)
Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11
Subs ('000)
Bharti 124,619 127,619 130,619 133,620 136,620 139,221 141,251 143,292 146,293 149,394 152,495 155,797 158,999
Hutchison 97,230 100,858 103,756 106,347 109,061 111,465 113,774 115,553 118,038 121,163 124,255 127,364 130,921
IDEA-Escotel 62,144 63,825 65,288 66,727 68,887 70,749 72,736 74,214 76,024 78,826 81,779 84,290 86,801
BPL 2,776 2,845 2,895 2,912 2,927 2,947 2,968 2,984 3,009 3,029 3,045 3,062 3,079
MTNL 4,697 4,784 4,818 4,858 4,902 4,948 4,990 5,025 5,053 5,091 5,115 5,153 5,179
BSNL 61,004 63,486 64,745 65,791 66,888 68,066 70,358 72,693 75,177 78,194 81,388 83,591 85,098
Aircel 34,861 36,861 38,470 40,080 41,680 43,297 44,907 46,515 47,520 48,739 50,169 51,832 53,500
Uninor 3,555 4,264 5,022 5,013 6,024 6,874 9,094 11,268 13,748 16,198 18,510 20,306 21,577
S Tel 717 1,007 1,112 1,233 1,327 1,423 1,519 1,642 1,867 2,068 2,316 2,515 2,692
Etisalat DB 5 10 18 30 44 57 71 132 265 453 652
Videocon 1,395 1,942 2,777 3,665 4,482 5,616 6,744 7,320 6,011 6,564
Total market 391,604 405,550 416,729 427,985 440,275 451,797 465,306 477,725 492,417 509,578 526,656 540,372 555,063
Market share of subs (%)
Bharti 31.8 31.5 31.3 31.2 31.0 30.8 30.4 30.0 29.7 29.3 29.0 28.8 28.6
Hutchison 24.8 24.9 24.9 24.8 24.8 24.7 24.5 24.2 24.0 23.8 23.6 23.6 23.6
IDEA-Escotel 15.9 15.7 15.7 15.6 15.6 15.7 15.6 15.5 15.4 15.5 15.5 15.6 15.6
BPL 0.7 0.7 0.7 0.7 0.7 0.7 0.6 0.6 0.6 0.6 0.6 0.6 0.6
MTNL 1.2 1.2 1.2 1.1 1.1 1.1 1.1 1.1 1.0 1.0 1.0 1.0 0.9
BSNL 15.6 15.7 15.5 15.4 15.2 15.1 15.1 15.2 15.3 15.3 15.5 15.5 15.3
Aircel 8.9 9.1 9.2 9.4 9.5 9.6 9.7 9.7 9.7 9.6 9.5 9.6 9.6
Uninor 0.9 1.1 1.2 1.2 1.4 1.5 2.0 2.4 2.8 3.2 3.5 3.8 3.9
S Tel 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.5 0.5
Etisalat DB 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.1
Videocon 0.3 0.4 0.6 0.8 0.9 1.1 1.3 1.4 1.1 1.2
Growth (%)
Bharti 2.4 2.4 2.4 2.3 2.2 1.9 1.5 1.4 2.1 2.1 2.1 2.2 2.1
Hutchison 3.3 3.7 2.9 2.5 2.6 2.2 2.1 1.6 2.2 2.6 2.6 2.5 2.8
IDEA-Escotel 3.8 2.7 2.3 2.2 3.2 2.7 2.8 2.0 2.4 3.7 3.7 3.1 3.0
BPL 2.8 2.5 1.8 0.6 0.5 0.7 0.7 0.5 0.9 0.6 0.5 0.6 0.6
MTNL 1.9 1.9 0.7 0.8 0.9 0.9 0.8 0.7 0.6 0.7 0.5 0.7 0.5
BSNL 2.6 4.1 2.0 1.6 1.7 1.8 3.4 3.3 3.4 4.0 4.1 2.7 1.8
Aircel 5.5 5.7 4.4 4.2 4.0 3.9 3.7 3.6 2.2 2.6 2.9 3.3 3.2
Uninor 40.1 19.9 17.8 (0.2) 20.2 14.1 32.3 23.9 22.0 17.8 14.3 9.7 6.3
S Tel 41.7 40.4 10.5 10.9 7.6 7.3 6.8 8.1 13.7 10.8 11.9 8.6 7.1
Etisalat DB 102.8 79.8 65.0 45.6 29.5 25.2 86.4 100.6 70.8 44.1
Videocon 39.3 43.0 32.0 22.3 25.3 20.1 8.5 (17.9) 9.2
Total market 3.4 3.6 2.8 2.7 2.9 2.6 3.0 2.7 3.1 3.5 3.4 2.6 2.7
Net monthly adds ('000)
Bharti 2,905 3,000 3,000 3,000 3,001 2,600 2,030 2,041 3,001 3,101 3,101 3,301 3,202
Hutchison 3,087 3,628 2,898 2,591 2,713 2,405 2,309 1,779 2,485 3,125 3,092 3,109 3,556
IDEA-Escotel 2,256 1,681 1,464 1,439 2,160 1,862 1,987 1,478 1,810 2,802 2,953 2,511 2,511
BPL 75 68 50 17 15 20 21 16 26 19 16 18 17
MTNL 87 87 33 40 44 46 42 35 29 37 25 38 26
BSNL 1,550 2,482 1,259 1,046 1,097 1,178 2,292 2,336 2,484 3,017 3,194 2,203 1,507
Aircel 1,825 2,000 1,608 1,610 1,600 1,617 1,610 1,609 1,004 1,219 1,430 1,663 1,669
Uninor 1,017 709 758 (9) 1,011 850 2,220 2,174 2,481 2,450 2,312 1,796 1,272
S Tel 211 290 106 121 93 97 96 123 225 201 247 199 178
Etisalat DB 5 5 8 12 14 13 14 61 133 188 200
Videocon 1,395 548 835 888 817 1,134 1,128 576 (1,308) 553
Total market 13,012 13,946 11,180 11,255 12,290 11,522 13,509 12,419 14,692 17,161 17,078 13,717 14,691
Market share of net adds (%)
Bharti 22.3 21.5 26.8 26.7 24.4 22.6 15.0 16.4 20.4 18.1 18.2 24.1 21.8
Hutchison 23.7 26.0 25.9 23.0 22.1 20.9 17.1 14.3 16.9 18.2 18.1 22.7 24.2
IDEA-Escotel 17.3 12.1 13.1 12.8 17.6 16.2 14.7 11.9 12.3 16.3 17.3 18.3 17.1
BPL 0.6 0.5 0.4 0.2 0.1 0.2 0.2 0.1 0.2 0.1 0.1 0.1 0.1
MTNL 0.7 0.6 0.3 0.4 0.4 0.4 0.3 0.3 0.2 0.2 0.1 0.3 0.2
BSNL 11.9 17.8 11.3 9.3 8.9 10.2 17.0 18.8 16.9 17.6 18.7 16.1 10.3
Aircel 14.0 14.3 14.4 14.3 13.0 14.0 11.9 13.0 6.8 7.1 8.4 12.1 11.4
Uninor 7.8 5.1 6.8 (0.1) 8.2 7.4 16.4 17.5 16.9 14.3 13.5 13.1 8.7
S Tel 1.6 2.1 0.9 1.1 0.8 0.8 0.7 1.0 1.5 1.2 1.4 1.5 1.2
Etisalat DB 0.0 0.0 0.1 0.1 0.1 0.1 0.1 0.4 0.8 1.4 1.4
Videocon 12.4 4.5 7.2 6.6 6.6 7.7 6.6 3.4 (9.5) 3.8
Note:
(a) Excluding RCOM and TTSL's GSM operations.
Source: COAI, , Kotak Institutional Equities

India Telecom
Exhibit 2: VLR subs operator-wise
Reported subs ('000) VLR subs ('000) VLR as % of reported

Dec-10 Jan-11 Dec-10 Jan-11 Dec-10 Jan-11
Bharti 152,495 155,797 139,977 144,314 91.8 92.6
Vodafone 124,255 127,364 94,304 98,937 75.9 77.7
Idea 81,779 84,290 73,635 76,147 90.0 90.3
BSNL 86,710 88,819 51,729 47,811 59.7 53.8
MTNL 5,398 5,432 1,894 1,986 35.1 36.6
Aircel 50,169 51,832 30,154 31,052 60.1 59.9
RCOM - total 125,652 128,872 84,136 85,455 67.0 66.3
TTSL - total 84,233 86,052 40,546 42,639 48.1 49.6
Shyam-Sistema 8,434 9,095 4,149 4,610 49.2 50.7
Loop Mobile 3,045 3,062 1,334 1,352 43.8 44.1
HFCL 1,342 1,283 634 640 47.2 49.9
Uninor 18,510 20,306 8,320 9,540 44.9 47.0
Videocon 7,320 6,011 2,724 2,987 37.2 49.7
S Tel 2,316 2,515 1,061 1,031 45.8 41.0
Etisalat 265 453 95 152 36.0 33.6
Total 751,921 771,181 534,693 548,653 71.1 71.1
Source: TRAI, Kotak Institutional Equities
Exhibit 3: VLR subs as % of total reported subs
Aircel Bharti BSNL Etisalat HFCL Idea Loop MTNL RCOM S Tel Shyam Tata Uninor Videocon Vodafone Total
AP 58.3 96.9 68.7 23.5 — 90.8 — — 68.2 — 67.8 57.0 39.7 28.0 56.8 74.7
Assam 85.0 96.2 64.0 — — 95.2 71.4 — 71.0 36.0 — 54.3 — — 74.0 81.0
Bihar 59.6 96.7 57.9 11.4 — 77.5 — — 64.4 41.8 36.2 42.8 47.5 47.8 77.4 70.8
Delhi 53.6 80.9 — 39.7 — 88.1 — 39.6 73.3 — 25.1 42.9 — — 94.4 73.1
Gujarat 53.7 87.4 58.6 18.2 — 92.3 — — 65.0 — 26.2 55.0 — 64.1 80.4 73.2
HP 127.5 90.6 56.2 - — 65.9 — — 61.1 48.2 — 40.6 — 51.0 82.7 69.8
Haryana 21.4 96.3 49.4 19.0 — 84.1 23.9 — 62.6 — 19.5 55.6 — 47.1 84.9 67.5
J&K 76.7 97.1 62.8 - — 89.5 — — 73.2 — — 60.6 — — 74.3 81.3
Karnataka 54.3 94.4 59.2 13.0 — 91.8 — — 67.0 — 74.8 56.8 41.6 6.5 61.3 73.4
Kerala 43.6 87.7 63.2 12.1 — 91.3 — — 65.4 — 48.7 49.2 26.4 25.8 76.9 70.5
Kolkata 53.5 90.2 33.2 - — 50.5 13.4 — 64.8 — 55.8 51.9 35.0 — 78.1 62.5
MP 55.5 93.0 42.5 19.8 — 100.0 16.4 — 62.3 — 30.3 62.8 — 38.0 55.1 74.0
Maharashtra 52.0 95.8 63.9 20.7 — 98.3 — — 70.4 — 62.6 52.3 52.4 49.1 84.8 77.6
Mumbai 43.7 86.5 — 35.3 — 90.3 44.2 33.7 72.8 — 19.4 37.5 37.5 61.7 73.0 59.6
North East 80.6 93.4 56.3 — — 95.2 — — 66.0 33.8 — 53.5 — — 70.5 76.4
Orissa 58.6 90.3 60.3 — — 42.6 14.7 — 65.7 35.8 — 46.6 31.5 22.2 66.9 64.4
Punjab 65.9 93.0 56.5 21.0 49.9 91.3 27.0 — 65.1 — 177.6 51.0 — — 82.1 73.8
Rajasthan 43.4 94.1 44.0 29.0 — 93.3 17.0 — 64.1 — 43.9 44.6 — 49.9 69.4 70.3
Tamil Nadu 58.2 92.9 50.9 11.2 — 55.8 — — 63.6 — 53.5 46.3 30.9 42.7 81.9 66.2
UP (E) 64.2 97.3 43.3 28.4 — 96.4 — — 66.0 — 55.6 47.4 61.4 65.3 79.9 72.2
UP (W) 59.5 83.2 44.8 21.2 — 94.8 — — 63.6 — 53.6 42.3 53.5 58.9 77.4 69.2
West Bengal 60.4 86.8 50.9 — — 44.2 — — 65.8 — 68.8 40.7 51.9 41.6 88.1 70.9
Total 59.9 92.6 53.8 3.6 49.9 90.3 44.1 36.6 66.3 41.0 50.7 49.6 47.0 49.7 77.7 71.1

Telecom India
Exhibit 4: ARPU based on VLR subs suggests a different picture as opposed to that based on reported SIM base
VLR subs as Reported VLR subs Adjusted Dec ARPU based Premium/ (discount) to Bharti (%)
% of subs market market share 2010 GR mkt on reported ARPU based
Company reported share (%) (%) share (%) subs on VLR subs On reported subs On VLR subs
Bharti 91.8 20.3 26.2 29.2 198 219 - -
Vodafone 75.9 16.5 17.6 21.4 180 238 (9) 9
Idea 90.0 10.9 13.8 13.5 173 195 (13) (11)
BSNL 59.7 11.5 9.7 7.6 92 151 (54) (31)
MTNL 35.1 0.7 0.4 0.5 100 282 (50) 29
Aircel 60.1 6.7 5.6 4.8 99 166 (50) (24)
RCOM - GSM 65.9 9.5 8.8
RCOM - CDMA 68.4 7.2 6.9
RCOM - total 67.0 16.7 15.7 13.5 112 167 (44) (24)
TTSL - GSM 49.8 5.6 3.9
TTSL - CDMA 46.5 5.6 3.6
TTSL - total 48.1 11.2 7.6 7.2 89 190 (55) (13)
Shyam-Sistema 49.2 1.1 0.8 0.6 87 181 (56) (18)
Loop Mobile 43.8 0.4 0.2 0.6 199 433 0 98
HFCL 47.2 0.2 0.1 0.1 125 261 (37) 19
Uninor 44.9 2.5 1.6 0.9 60 152 (70) (31)
Videocon 37.2 1.0 0.5 — — — — —
S Tel 45.8 0.3 0.2 0.1 45 123 (77) (44)
Etisalat 36.0 0.0 0.0 — — — — —
Total 71.1 100.0 100.0 100.0 140 198 (30) (10)
(a) GR is adjusted for wireline revenues included by various players in reporting.

Kotak Institutional Equities: Valuation summary of key Indian companies
India Daily Summary - March 18, 2011

O/S Target
17-Mar-11 Mkt cap. shares EPS (Rs) EPS growth (%) PER (X) EV/EBITDA (X) Price/BV (X) Dividend yield (%) RoE (%) price Upside ADVT-3mo
Company Price (Rs) Rating (Rs mn) (US$ mn) (mn) 2011E 2012E 2013E 2011E 2012E 2013E 2011E 2012E 2013E 2011E 2012E 2013E 2011E 2012E 2013E 2011E 2012E 2013E 2011E 2012E 2013E (Rs) (%) (US$ mn)
KOTAK INSTITUTIONAL EQUITIES RESEARCH
Automobiles
Ashok Leyland 53 SELL 70,838 1,568 1,330 4.3 4.7 5.7 53.5 8.1 22.3 12.3 11.4 9.3 8.3 7.9 5.9 1.6 1.4 1.3 1.9 1.9 1.9 13.6 13.4 14.7 56 5.2 8.0
Bajaj Auto 1,359 ADD 393,280 8,704 289 90.3 100.0 111.6 43.8 10.8 11.5 15.1 13.6 12.2 14.4 13.5 12.3 8.5 6.0 4.4 1.8 1.8 1.8 68.5 50.6 40.7 1,500 10.4 23.0
Bharat Forge 330 ADD 78,889 1,746 239 12.4 19.7 22.8 1,705.4 59.1 15.6 26.6 16.7 14.5 12.5 8.4 7.1 3.7 3.1 2.5 — — — 8.5 16.4 17.9 405 22.7 3.6
Exide Industries 137 ADD 116,578 2,580 850 7.1 8.4 9.8 12.6 17.9 17.4 19.3 16.4 13.9 13.6 11.1 9.4 4.2 3.4 2.8 0.4 0.4 0.4 24.1 22.8 21.8 160 16.7 6.7
Hero Honda 1,510 REDUCE 301,577 6,674 200 97.8 109.8 126.9 (12.5) 12.3 15.5 15.4 13.8 11.9 10.5 8.9 7.2 6.3 4.8 3.7 2.0 2.0 2.0 45.0 39.5 35.2 1,485 (1.7) 31.6
Mahindra & Mahindra 656 BUY 403,602 8,932 615 42.8 47.7 53.8 22.1 11.6 12.8 15.3 13.7 12.2 11.8 10.4 9.0 3.7 3.1 2.6 1.4 1.5 1.7 27.6 24.5 23.0 800 21.9 34.0
Maruti Suzuki 1,165 BUY 336,609 7,450 289 78.4 91.8 104.7 (9.3) 17.0 14.1 14.9 12.7 11.1 9.6 7.8 6.1 2.4 2.0 1.7 0.5 0.5 0.6 17.4 17.3 16.8 1,460 25.3 11.0
Tata Motors 1,140 ADD 757,509 16,765 665 129.9 133.6 159.2 603.4 2.9 19.1 8.8 8.5 7.2 6.1 5.7 4.9 3.5 2.5 1.9 0.5 0.5 0.5 58.6 34.9 30.5 1,305 14.5 95.1
Automobiles Cautious 2,458,882 54,418 83.9 9.2 16.2 12.6 11.5 9.9 8.6 7.8 6.6 3.8 2.9 2.3 1.1 1.1 1.1 30.0 25.6 23.6
Banks/Financial Institutions
Andhra Bank 138 BUY 72,668 1,608 526 24.1 26.4 30.6 12.0 9.5 15.9 5.7 5.2 4.5 — — — 1.2 1.0 0.9 4.1 4.4 5.1 24.4 21.4 21.2 180 30.3 3.7
Axis Bank 1,291 BUY 523,120 11,577 405 81.7 99.9 122.8 31.6 22.3 22.9 15.8 12.9 10.5 — — — 2.8 2.4 2.0 1.2 1.5 1.8 19.1 20.1 21.0 1,600 23.9 50.6
Bank of Baroda 905 BUY 330,857 7,322 366 108.0 120.5 142.2 29.1 11.6 18.0 8.4 7.5 6.4 — — — 2.0 1.6 1.4 2.1 2.4 2.8 25.8 23.7 23.2 1,200 32.6 8.9
Bank of India 449 ADD 245,914 5,442 547 49.7 62.7 68.5 50.1 26.1 9.2 9.0 7.2 6.6 — — — 1.6 1.3 1.2 2.3 2.9 3.2 19.0 20.0 18.9 560 24.6 10.1
Canara Bank 630 ADD 258,362 5,718 410 98.0 102.2 124.2 33.0 4.2 21.6 6.4 6.2 5.1 — — — 1.4 1.2 1.0 1.6 1.9 1.9 23.1 19.1 19.6 700 11.1 13.6
Corporation Bank 549 ADD 81,267 1,799 148 86.9 95.8 113.6 5.9 10.3 18.6 6.3 5.7 4.8 — — — 1.1 1.0 0.9 3.2 3.5 4.2 20.0 18.6 19.1 700 27.6 1.0
Federal Bank 375 BUY 64,095 1,418 171 34.3 44.5 52.4 26.3 29.7 17.8 10.9 8.4 7.1 — — — 1.3 1.1 1.0 1.7 2.2 2.6 11.9 14.0 14.7 450 20.1 4.5
HDFC 637 REDUCE 914,445 20,238 1,436 24.1 27.1 31.7 22.2 12.6 17.1 26.5 23.5 20.1 — — — 5.3 4.7 3.6 1.3 1.5 1.8 21.3 21.2 20.9 690 8.3 45.7
HDFC Bank 2,182 ADD 998,567 22,100 458 86.2 111.8 142.9 33.8 29.8 27.8 25.3 19.5 15.3 — — — 4.1 3.5 3.0 0.7 1.0 1.2 17.1 19.2 21.0 2,400 10.0 47.7
ICICI Bank 1,012 ADD 1,164,527 25,772 1,151 45.8 58.0 68.3 26.7 26.8 17.7 22.1 17.4 14.8 — — — 2.1 2.0 1.8 1.4 1.7 2.0 9.9 11.6 12.6 1,200 18.6 107.0
IDFC 145 ADD 218,231 4,830 1,506 9.1 10.9 14.1 8.3 19.5 29.5 16.0 13.3 10.3 — — — 2.0 1.7 1.5 1.1 1.4 1.9 15.0 13.9 15.5 175 20.8 27.5
India Infoline 70 BUY 22,921 507 327 7.4 8.0 9.4 (9.0) 8.1 17.4 9.5 8.8 7.5 — — — 1.3 1.1 1.0 4.1 2.4 2.9 13.2 13.8 14.1 100 42.8 3.1
Indian Bank 219 BUY 94,077 2,082 430 37.9 43.5 53.3 8.1 14.6 22.5 5.8 5.0 4.1 — — — 1.2 1.0 0.8 3.1 3.6 4.4 21.7 21.0 21.7 320 46.2 2.2
Indian Overseas Bank 144 BUY 88,920 1,968 619 15.8 21.9 29.5 21.6 38.9 34.7 9.1 6.5 4.9 — — — 1.1 0.9 0.8 2.7 3.0 3.2 11.6 13.8 16.4 180 25.4 3.0
IndusInd Bank 245 BUY 112,928 2,499 461 9.1 10.9 14.1 8.3 19.5 29.5 27.0 22.6 17.4 — — — 3.1 2.8 2.4 1.1 1.3 1.6 19.9 17.6 19.0 300 22.4 7.6
J&K Bank 768 ADD 37,256 825 48 123.5 136.6 154.0 16.9 10.6 12.8 6.2 5.6 5.0 — — — 1.1 1.0 0.9 3.3 3.7 4.2 18.5 17.8 17.6 850 10.6 0.6
LIC Housing Finance 199 ADD 94,468 2,091 475 19.3 21.4 25.6 38.5 10.9 19.5 10.3 9.3 7.8 — — — 2.3 2.0 1.7 2.1 2.3 2.8 24.6 22.8 23.0 206 3.6 45.0
Mahindra & Mahindra Financial 707 ADD 72,188 1,598 102 47.5 60.8 71.7 32.4 28.1 17.8 14.9 11.6 9.9 — — — 3.0 2.5 2.2 1.4 1.8 2.1 22.8 22.6 22.4 800 13.2 2.6
Oriental Bank of Commerce 370 ADD 107,893 2,388 292 52.0 58.7 66.0 14.9 12.7 12.5 7.1 6.3 5.6 — — — 1.1 0.9 0.8 2.8 3.2 3.6 15.7 14.6 14.8 450 21.7 5.9
PFC 235 REDUCE 269,324 5,960 1,148 24.1 28.2 33.0 17.5 17.0 16.8 9.7 8.3 7.1 — — — 1.8 1.6 1.4 2.1 2.4 2.8 19.3 19.5 19.6 300 27.8 4.0
Punjab National Bank 1,098 BUY 347,813 7,698 317 137.6 165.6 202.2 11.1 20.3 22.1 8.0 6.6 5.4 — — — 1.7 1.4 1.2 2.6 3.1 3.8 23.8 23.8 24.2 1,500 36.6 7.3
Reliance Capital 583 ADD 143,585 3,178 246 6.6 17.0 27.9 (49.8) 159.7 63.6 88.9 34.2 20.9 — — — 2.1 2.0 1.9 0.4 1.2 1.9 2.3 5.9 9.3 620 6.3 39.5
Rural Electrification Corp. 223 REDUCE 220,188 4,873 987 25.5 29.2 33.3 25.9 14.5 13.8 8.7 7.6 6.7 — — — 1.7 1.5 1.3 3.4 3.9 4.5 21.2 21.2 21.0 275 23.3 21.6
Shriram Transport 722 ADD 161,107 3,565 223 56.1 66.8 81.0 43.2 19.1 21.3 12.9 10.8 8.9 — — — 3.5 2.8 2.3 1.6 1.9 2.2 28.9 27.7 27.3 800 10.8 5.6
SKS Microfinance 571 REDUCE 43,019 952 75 24.2 36.5 62.3 (10.3) 50.9 70.8 23.6 15.7 9.2 — — — 2.3 2.0 1.6 - - - 12.6 13.5 19.5 700 22.6 9.2
State Bank of India 2,618 BUY 1,661,805 36,778 635 175.2 225.2 272.1 21.3 28.6 20.8 14.9 11.6 9.6 — — — 2.2 1.9 1.6 1.2 1.3 1.4 15.8 17.7 18.4 3,300 26.1 171.0
Union Bank 338 BUY 181,006 4,006 536 39.0 51.3 61.4 (5.1) 31.6 19.5 8.7 6.6 5.5 — — — 1.6 1.3 1.1 1.5 2.0 2.4 20.5 21.5 21.4 420 24.4 4.2
Yes Bank 279 BUY 94,699 2,096 340 21.4 26.4 33.1 42.4 23.5 25.4 13.0 10.6 8.4 — — — 2.5 2.1 1.7 0.8 0.9 1.2 21.3 21.7 22.4 370 32.7 20.6
Banks/Financial Institutions Attractive 8,625,250 190,887 24.6 21.3 20.6 13.6 11.2 9.3 — — — 2.2 1.9 1.7 1.5 1.8 2.1 16.3 17.2 17.7
Cement
ACC 1,025 SELL 192,652 4,264 188 51.7 54.5 68.0 (37.9) 5.4 24.9 19.8 18.8 15.1 11.4 9.1 7.2 2.8 2.6 2.3 2.3 2.3 2.3 16.4 15.8 17.3 920 (10.3) 8.6
Ambuja Cements 132 SELL 200,573 4,439 1,522 7.9 7.9 8.7 (0.7) (0.1) 9.4 16.6 16.6 15.2 10.1 9.0 7.9 2.6 2.3 2.2 1.6 1.7 1.8 16.8 15.0 14.9 108 (18.0) 5.0
Grasim Industries 2,438 ADD 223,540 4,947 92 224.3 261.1 327.0 (25.5) 16.4 25.3 10.9 9.3 7.5 6.3 4.8 4.0 1.6 1.4 1.2 1.4 1.4 1.4 15.4 15.7 17.0 2,600 6.6 3.9
India Cements 93 SELL 28,475 630 307 3.0 6.8 11.7 (70.5) 130.5 71.9 31.3 13.6 7.9 11.9 7.7 4.6 0.7 0.7 0.6 3.4 3.4 3.4 2.3 5.3 8.8 85 (8.3) 2.2
Shree Cement 1,858 REDUCE 64,741 1,433 35 84.0 161.7 185.0 (59.6) 92.6 14.5 22.1 11.5 10.0 7.6 4.3 3.3 3.2 2.6 2.2 0.6 0.6 0.6 15.2 25.0 23.6 1,680 (9.6) 0.5
UltraTech Cement 1,024 REDUCE 280,490 6,208 274 42.3 79.7 102.1 (52.1) 88.6 28.1 24.2 12.8 10.0 11.9 6.9 5.7 2.3 2.0 1.7 0.4 0.4 0.4 11.9 19.3 20.4 1,030 0.6 2.9
Cement Neutral 990,472 21,920 (24.7) 31.2 24.0 17.1 13.1 10.5 9.0 6.4 5.3 2.1 1.9 1.6 1.3 1.3 1.4 12.3 14.2 15.4
India Daily Summary - March 1
Source: Company, Bloomberg, Kotak Institutional Equities estimates

22
O/S Target
23
Consumer products
Asian Paints 2,579 REDUCE 247,396 5,475 96 82.6 95.7 113.0 15.5 15.8 18.1 31.2 27.0 22.8 20.6 17.4 14.3 12.2 10.0 7.6 1.4 1.6 1.0 44.9 41.7 38.4 2,550 (1.1) 6.2
Colgate-Palmolive (India) 840 SELL 114,207 2,528 136 31.0 36.0 41.3 (0.5) 16.2 14.7 27.1 23.3 20.3 23.9 20.6 17.7 30.3 26.1 21.2 2.8 3.2 3.4 119.7 120.3 115.2 800 (4.7) 2.7
Dabur India 96 ADD 166,282 3,680 1,731 3.2 3.8 4.4 11.7 17.9 14.3 29.7 25.2 22.0 21.9 18.1 15.4 12.2 9.5 7.5 1.2 1.4 1.6 49.0 42.7 38.3 110 14.5 3.6
GlaxoSmithkline Consumer (a) 2,088 ADD 87,793 1,943 42 71.9 84.1 99.5 29.8 17.1 18.3 29.1 24.8 21.0 21.7 18.6 15.1 9.2 7.5 6.1 2.4 1.3 1.6 32.4 33.0 31.9 2,400 15.0 0.9
Godrej Consumer Products 360 ADD 116,509 2,578 324 13.6 17.1 20.8 20.0 26.1 21.2 26.5 21.0 17.3 20.1 15.6 12.5 6.5 6.0 5.4 0.9 0.9 0.9 31.9 29.6 33.0 440 22.2 1.8
Hindustan Unilever 271 SELL 590,583 13,070 2,182 9.6 11.4 13.1 2.2 17.9 15.1 28.1 23.8 20.7 22.7 19.1 16.0 19.9 17.3 15.0 2.9 3.4 4.0 75.9 77.8 77.8 250 (7.6) 14.5
ITC 168 ADD 1,283,289 28,401 7,636 6.5 7.8 9.1 22.8 19.0 17.4 25.8 21.7 18.5 17.1 14.1 11.9 7.2 6.3 5.5 1.6 2.2 2.7 32.1 32.4 33.1 185 10.1 30.4
Jubilant Foodworks 564 SELL 35,996 797 64 11.5 14.5 19.4 104.4 26.3 34.0 49.1 38.9 29.0 29.6 20.4 15.3 18.9 12.7 8.8 — — — 47.6 39.1 35.9 450 (20.2) 11.2
Jyothy Laboratories 202 ADD 16,251 360 81 11.4 13.7 16.2 3.8 19.4 18.5 17.6 14.8 12.5 12.2 9.3 7.2 2.3 2.1 1.9 1.7 2.3 2.9 12.8 14.6 — 270 34.0 0.7
Marico 134 ADD 81,643 1,807 612 5.0 5.6 6.5 12.2 12.8 15.0 26.8 23.7 20.6 19.7 16.3 13.8 9.0 6.9 5.5 0.7 0.7 0.9 39.2 33.3 29.8 140 4.9 2.6
Nestle India (a) 3,564 REDUCE 343,664 7,606 96 87.0 104.1 126.2 17.0 19.6 21.2 40.9 34.2 28.3 27.3 22.4 18.3 48.1 38.4 30.9 1.7 2.0 2.5 129.6 124.8 121.2 3,100 (13.0) 2.7
Tata Global Beverages 97 ADD 60,170 1,332 618 5.2 5.9 7.0 (14.0) 14.2 16.9 18.7 16.4 14.0 9.2 8.3 7.0 1.2 1.1 1.1 1.8 2.0 2.4 8.4 9.1 10.1 110 13.1 3.5
Titan Industries 3,564 ADD 158,197 3,501 44 107.1 125.9 145.6 87.1 17.5 15.6 33.3 28.3 24.5 24.2 20.0 15.9 13.7 9.6 7.2 0.3 0.4 0.5 50.3 39.8 33.5 4,100 15.0 32.1
United Spirits 1,043 ADD 130,951 2,898 126 33.1 47.0 62.3 21.5 41.9 32.4 31.5 22.2 16.7 15.4 12.6 10.7 3.1 2.8 2.4 0.2 0.3 0.4 10.5 13.3 15.4 1,550 48.7 9.6
Consumer products Cautious 3,432,930 75,975 17.3 19.1 17.9 28.3 23.8 20.2 19.5 16.1 13.5 8.5 7.4 6.4 1.7 2.1 2.4 30.2 31.2 31.6
Constructions
IVRCL 73 BUY 19,465 431 267 7.0 8.9 12.6 (11.7) 28.1 40.7 10.4 8.1 5.8 7.1 6.0 4.9 1.0 0.9 0.8 0.5 0.5 0.5 9.6 11.2 13.9 125 71.5 8.3
Nagarjuna Construction Co. 95 BUY 24,440 541 257 7.2 9.7 13.1 1.2 34.3 35.4 13.2 9.8 7.3 8.9 7.3 5.6 1.0 1.0 0.9 2.1 2.1 2.1 8.0 10.1 12.5 160 68.0 3.0
Punj Lloyd 63 REDUCE 21,292 471 340 1.3 8.5 12.6 (137.2) 567.0 48.2 49.2 7.4 5.0 7.9 5.6 4.6 0.7 0.6 0.6 0.1 1.2 1.8 1.4 9.0 12.2 90 43.5 10.7
Sadbhav Engineering 107 BUY 16,065 356 150 6.2 8.7 10.0 20.2 41.0 14.4 17.3 12.3 10.7 9.6 8.0 7.2 3.1 2.9 2.7 5.6 5.6 5.6 17.8 23.9 25.2 175 63.4 0.4
Construction Attractive 81,262 1,798 48.4 78.7 37.8 16.0 9.0 6.5 8.1 6.4 5.2 1.0 0.9 0.8 1.9 2.2 2.3 6.4 10.4 12.9
Energy
Aban Offshore 591 BUY 25,710 569 44 104.6 107.6 116.9 (1.9) 2.9 8.7 5.6 5.5 5.1 6.5 6.4 6.2 1.2 1.0 0.9 0.6 0.7 0.8 26.1 20.4 18.0 815 37.9 17.8
Bharat Petroleum 574 ADD 207,506 4,592 362 51.9 46.5 65.7 (9.9) (10.4) 41.2 11.1 12.3 8.7 8.7 9.4 6.8 1.4 1.3 1.2 2.8 2.7 3.8 12.2 10.1 13.2 655 14.1 9.8
Cairn india 345 RS 655,310 14,503 1,897 30.9 57.0 58.0 457.4 84.7 1.7 11.2 6.1 6.0 8.5 4.6 4.1 1.7 1.4 1.3 — 4.3 5.8 15.9 25.5 22.8 — — 19.4
Castrol India (a) 423 SELL 104,624 2,315 247 19.8 20.5 21.1 28.7 3.2 3.1 21.3 20.7 20.1 13.4 13.2 12.8 20.3 18.8 17.9 3.5 3.8 4.0 100.5 94.4 91.5 370 (12.6) 0.6
GAIL (India) 452 ADD 573,797 12,699 1,268 29.3 34.7 43.6 18.5 18.4 25.4 15.4 13.0 10.4 9.9 9.5 7.3 2.8 2.4 2.0 1.9 2.2 3.1 18.1 18.6 19.8 510 12.7 12.6
GSPL 99 REDUCE 55,823 1,235 562 8.5 8.6 10.4 16.8 0.9 20.9 11.6 11.5 9.5 7.3 6.7 5.9 2.6 2.3 2.0 2.2 3.5 5.2 24.9 21.1 22.6 90 (9.3) 3.4
Hindustan Petroleum 338 BUY 114,484 2,534 339 46.5 35.0 49.9 (9.9) (24.8) 42.8 7.3 9.7 6.8 3.0 3.2 2.4 0.8 0.7 0.7 4.3 3.2 4.6 10.6 7.4 9.8 420 24.4 8.7
Indian Oil Corporation 306 BUY 743,438 16,453 2,428 35.1 33.2 39.6 (28.5) (5.4) 19.1 8.7 9.2 7.7 6.7 6.7 5.1 1.3 1.2 1.1 3.5 3.3 3.9 14.2 12.4 13.5 390 27.4 7.0
Oil India 1,276 BUY 306,856 6,791 240 140.9 151.2 181.7 22.3 7.3 20.2 9.1 8.4 7.0 4.1 3.5 2.7 1.8 1.6 1.4 3.5 3.9 4.7 18.9 17.9 18.9 1,550 21.5 2.0
Oil & Natural Gas Corporation 272 BUY 2,330,103 51,568 8,556 28.6 34.9 39.6 24.5 22.3 13.3 9.5 7.8 6.9 3.8 3.2 2.7 1.6 1.4 1.3 5.1 4.4 5.1 16.5 18.5 18.5 360 32.2 30.2
Petronet LNG 118 SELL 88,125 1,950 750 8.1 8.9 8.6 49.3 10.9 (3.7) 14.6 13.2 13.7 8.9 8.4 8.6 2.9 2.5 2.2 2.1 2.6 2.6 20.4 19.3 16.1 100 (14.9) 5.6
Reliance Industries 1,031 REDUCE 3,069,871 67,940 2,978 62.7 66.3 71.9 26.3 5.8 8.4 16.4 15.5 14.3 8.8 7.5 6.6 1.9 1.7 1.5 0.8 1.0 1.2 13.2 12.6 12.4 1,000 (3.0) 129.1

Energy Neutral 8,275,647 183,150 19.7 16.1 12.8 11.5 9.9 8.8 6.3 5.3 4.5 1.7 1.5 1.4 2.5 2.8 3.4 15.0 15.6 15.8
Industrials
ABB 736 REDUCE 155,933 3,451 212 9.8 26.0 31.4 (41.6) 165.6 20.7 75.2 28.3 23.5 51.9 18.5 15.0 6.1 5.2 4.3 0.4 0.4 0.4 8.3 19.7 20.0 660 (10.3) 2.5
BGR Energy Systems 447 REDUCE 32,173 712 72 40.9 46.4 46.0 46.3 13.4 (0.9) 10.9 9.6 9.7 6.9 5.9 5.5 3.5 2.7 2.2 1.8 2.1 2.1 36.0 31.6 25.2 600 34.3 4.8
Bharat Electronics 1,625 REDUCE 130,012 2,877 80 101.3 124.9 145.8 5.4 23.2 16.8 16.0 13.0 11.1 8.7 6.5 5.4 2.6 2.2 1.9 1.5 1.5 1.5 17.0 18.3 18.5 1,875 15.4 0.9
Bharat Heavy Electricals 1,964 REDUCE 961,417 21,277 490 115.5 140.1 156.2 31.4 21.3 11.5 17.0 14.0 12.6 11.6 9.1 7.8 4.8 3.8 3.1 1.3 1.5 1.7 31.3 30.2 27.1 2,400 22.2 33.1
Crompton Greaves 269 BUY 172,307 3,813 642 14.4 16.2 18.9 12.0 12.5 16.5 18.7 16.6 14.2 11.5 9.7 8.0 5.2 4.1 3.3 0.7 0.8 0.9 31.9 27.8 25.8 310 15.4 6.4
Larsen & Toubro 1,523 REDUCE 921,810 20,401 605 73.0 82.0 96.4 26.0 12.3 17.6 20.9 18.6 15.8 12.8 10.9 9.4 3.4 2.9 2.5 0.8 0.9 0.9 17.9 17.0 17.2 1,775 16.5 72.9
Maharashtra Seamless 331 ADD 23,356 517 71 44.2 39.3 43.7 14.3 (10.9) 11.1 7.5 8.4 7.6 3.4 3.6 2.9 0.9 0.9 0.8 2.4 2.4 2.6 12.8 10.5 10.9 418 26.2 0.4
Siemens 872 REDUCE 293,919 6,505 337 22.4 27.4 33.2 39.5 21.9 21.3 38.8 31.9 26.3 23.0 20.6 16.6 9.1 7.4 6.1 0.6 0.6 0.8 25.2 25.6 25.5 735 (15.7) 10.3
Suzlon Energy 46 REDUCE 72,993 1,615 1,594 (3.7) 3.5 7.1 (40.3) (196.0) 102.1 (12.5) 13.0 6.4 17.5 7.6 5.6 1.0 1.0 0.9 — — 0.4 (8.6) 7.9 14.8 45 (1.7) 27.4
Thermax 576 BUY 68,654 1,519 119 32.3 36.0 40.9 47.2 11.6 13.5 17.9 16.0 14.1 11.6 10.0 8.5 5.1 4.2 3.5 1.6 1.8 2.0 31.9 29.0 27.3 760 31.9 1.4
Voltas 159 REDUCE 52,554 1,163 331 10.6 12.1 13.8 (2.1) 13.9 13.6 14.9 13.1 11.5 8.9 7.4 5.8 4.0 3.3 2.6 2.0 2.3 (0.0) 29.0 27.5 25.1 200 25.9 4.0
Industrials Cautious 2,885,129 63,851 30.5 28.1 17.4 21.3 16.6 14.2 12.9 10.2 8.6 3.9 3.3 2.8 1.0 1.1 1.2 18.2 19.7 19.5
Infrastructure
Container Corporation 1,230 REDUCE 159,830 3,537 130 66.7 77.5 88.2 10.1 16.2 13.9 18.4 15.9 13.9 12.5 10.4 8.8 3.2 2.8 2.4 1.3 1.5 1.7 18.6 18.9 18.7 1,300 5.7 1.1
GMR Infrastructure 38 ADD 139,178 3,080 3,667 (0.0) (0.1) 0.7 (102.0) 1,494.0 (635.9) (4,378.3) (274.7) 51.3 15.2 12.4 10.0 1.3 1.3 1.3 — — — (0.0) (0.8) 4.0 45 18.6 4.3
Gujarat Pipavav Port 59 BUY 25,096 555 424 (1.3) 1.1 2.5 (64.8) (186.1) 123.3 (45.5) 52.8 23.7 27.4 16.1 10.9 3.3 3.1 2.8 — — — (9.7) 8.5 12.7 68 14.8 0.4
GVK Power & Infrastructure 25 BUY 39,243 869 1,579 1.3 1.5 1.9 27.3 18.1 28.1 19.8 16.7 13.1 13.2 13.0 9.7 1.2 1.1 1.0 1.2 1.2 1.4 6.1 6.9 8.3 42 69.0 5.1
IRB Infrastructure 183 BUY 60,673 1,343 332 13.5 12.3 13.5 16.3 (8.8) 9.7 13.5 14.8 13.5 8.5 7.7 6.8 2.2 1.7 1.4 — — — 18.1 12.9 11.5 270 47.9 5.7
Mundra Port and SEZ 134 BUY 269,632 5,967 2,017 4.3 6.8 10.4 28.0 58.7 53.3 31.3 19.7 12.9 22.6 16.1 11.3 6.4 5.0 3.9 — — — 22.2 28.5 34.0 160 19.7 3.9
Infrastructure Cautious 693,652 15,351 13.4 30.1 44.9 29.9 23.0 15.9 15.1 12.2 9.6 2.6 2.3 2.1 0.4 0.4 0.5 8.6 10.1 13.0


O/S Target
Media
DB Corp 249 BUY 45,250 1,001 182 12.6 14.0 17.0 18.8 10.8 21.6 19.7 17.8 14.6 11.6 10.6 8.7 5.7 4.9 4.3 1.6 2.4 3.2 31.8 29.7 31.2 325 30.5 0.2
DishTV 62 ADD 65,956 1,460 1,062 (1.6) 0.2 1.3 (33.2) (109.5) 719.1 (37.7) 398.0 48.6 30.1 14.5 10.1 29.3 27.3 17.5 — — — (56.0) 7.1 43.8 66 6.3 3.7
Eros International 130 BUY 12,033 266 93 12.6 16.6 20.9 30.1 32.5 25.3 10.3 7.8 6.2 7.1 5.7 4.2 1.7 1.4 1.1 — — — 24.7 19.8 20.1 200 54.1 0.6
Hindustan Media Ventures 143 BUY 10,519 233 73 7.9 10.0 13.0 220.4 27.5 29.7 18.3 14.3 11.0 14.2 11.5 9.5 2.4 2.1 1.8 5.2 7.0 9.8 23.7 16.4 18.3 200 39.5 0.0
HT Media 132 ADD 30,997 686 235 7.0 8.5 11.2 15.4 21.0 31.9 18.7 15.5 11.7 8.3 6.6 5.1 2.2 2.1 2.0 1.5 3.0 5.3 13.8 13.9 17.3 170 28.9 0.2
Jagran Prakashan 114 BUY 34,331 760 301 7.0 7.9 9.3 19.2 13.4 18.4 16.4 14.4 12.2 9.5 8.5 7.1 5.0 4.6 4.2 3.5 4.4 5.3 32.4 33.4 36.1 155 36.0 0.6
Sun TV Network 435 REDUCE 171,445 3,794 394 18.3 22.7 27.2 39.7 24.1 20.2 23.8 19.2 16.0 14.2 11.5 9.5 7.4 6.2 5.4 1.7 2.3 3.2 34.2 35.5 36.4 450 3.4 7.1
Zee Entertainment Enterprises 120 ADD 117,355 2,597 978 4.8 6.2 7.8 (9.7) 28.4 26.4 24.9 19.4 15.3 15.7 12.0 9.3 2.8 2.8 2.7 1.1 1.2 1.4 11.8 14.7 18.1 130 8.4 7.5
Media Cautious 487,885 10,798 37.7 35.7 28.0 27.2 20.0 15.6 13.9 10.8 8.5 4.6 4.2 3.7 1.4 1.8 2.5 16.8 20.8 24.0
Metals & Mining
Coal India 343 BUY 2,166,197 47,941 6,316 17.0 24.0 28.0 11.7 41.0 16.8 20.2 14.3 12.2 12.6 9.2 7.5 6.4 5.0 4.0 1.5 2.1 2.5 35.1 39.0 36.0 390 13.7 30.1
Hindalco Industries 198 ADD 378,398 8,374 1,914 16.2 16.9 18.6 (18.8) 4.3 9.8 12.2 11.7 10.6 7.3 7.5 7.2 1.6 1.4 1.2 0.7 0.7 0.7 13.6 12.7 12.4 250 26.5 52.7
Hindustan Zinc 129 BUY 543,758 12,034 4,225 10.4 12.5 14.1 8.4 21.0 12.2 12.4 10.3 9.1 7.5 5.0 3.7 2.4 1.9 1.6 0.5 0.5 0.5 21.7 21.5 19.8 153 18.9 5.6
Jindal Steel and Power 653 REDUCE 607,956 13,455 931 41.0 48.0 55.6 7.1 17.3 15.6 15.9 13.6 11.8 10.8 8.9 7.3 4.0 3.1 2.5 0.4 0.4 0.4 29.2 26.0 23.5 640 (2.0) 20.9
JSW Steel 890 REDUCE 220,869 4,888 248 67.1 99.2 110.9 (16.5) 47.9 11.8 13.3 9.0 8.0 8.0 5.3 4.8 1.2 1.0 0.9 1.0 1.1 1.1 11.6 12.1 11.3 1,000 12.4 46.2
National Aluminium Co. 104 SELL 267,904 5,929 2,577 4.6 5.1 6.2 50.5 12.0 20.2 22.7 20.3 16.8 12.9 11.1 8.9 2.4 2.2 2.0 1.2 1.2 1.2 10.9 11.3 12.5 76 (26.9) 1.4
Sesa Goa 260 REDUCE 231,412 5,121 890 53.2 60.6 57.2 79.9 13.9 (5.5) 4.9 4.3 4.5 2.7 5.0 4.8 1.7 1.2 1.0 1.4 1.4 1.5 36.4 34.0 23.7 275 5.7 24.8
Sterlite Industries 160 BUY 536,352 11,870 3,362 13.0 19.4 22.2 8.0 49.4 14.5 12.3 8.2 7.2 7.0 4.3 3.3 1.3 1.1 1.0 0.6 0.6 0.6 11.2 14.8 14.7 200 25.4 25.1
Tata Steel 593 BUY 600,573 13,291 1,013 64.4 69.7 87.5 (2,051.8) 8.2 25.6 9.2 8.5 6.8 6.8 5.9 4.8 1.7 1.5 1.2 1.3 — — 22.4 18.4 19.5 710 19.8 104.3
Metals & Mining Attractive 5,553,418 122,904 36.0 25.7 14.2 13.7 10.9 9.6 8.4 6.8 5.6 2.6 2.1 1.8 1.1 1.2 1.3 18.8 19.5 18.7
Pharmaceutical
Apollo Hospitals 483 BUY 62,209 1,377 129 14.0 19.0 22.1 28.2 35.7 16.0 34.4 25.4 21.9 15.1 12.0 10.5 3.4 3.0 2.6 — — — 10.4 12.1 12.2 565 16.9 1.8
Biocon 330 ADD 65,980 1,460 200 18.3 22.7 25.9 23.4 24.2 13.8 18.0 14.5 12.7 10.3 8.8 7.3 3.2 2.7 2.3 — — — 19.3 20.5 19.8 445 34.9 4.5
Cipla 298 REDUCE 239,391 5,298 803 12.1 16.0 18.5 (11.9) 32.3 15.6 24.7 18.7 16.1 19.7 14.5 12.1 3.6 3.1 2.7 0.8 0.8 0.8 15.4 17.9 — 300 0.6 10.9
Cadila Healthcare 766 ADD 156,745 3,469 205 33.3 38.2 47.7 34.9 14.7 24.7 23.0 20.0 16.1 18.6 14.9 12.0 7.2 5.7 4.5 0.9 1.0 1.2 35.9 31.6 31.0 880 15.0 1.6
Dishman Pharma & chemicals 95 SELL 7,743 171 81 8.8 8.2 9.8 (39.2) (6.4) 19.1 10.8 11.6 9.7 10.0 7.6 6.7 0.9 0.9 0.8 — — — 8.7 7.6 8.5 85 (10.7) 0.6
Divi's Laboratories 624 REDUCE 82,673 1,830 133 26.8 37.1 45.7 3.9 38.6 23.4 23.3 16.8 13.6 18.3 12.2 9.6 4.7 4.0 3.3 — — — 21.7 25.6 26.3 700 12.3 2.0
GlaxoSmithkline Pharmaceuticals (a) 2,099 REDUCE 177,817 3,935 85 68.3 79.5 90.4 15.5 16.4 13.8 30.8 26.4 23.2 20.7 17.5 15.1 9.1 8.4 7.6 — — — 31.0 33.0 34.4 2,000 (4.7) 1.5
Glenmark Pharmaceuticals 268 REDUCE 75,064 1,661 280 17.6 20.6 25.9 38.3 17.3 25.9 15.3 13.0 10.3 13.8 11.0 9.0 2.7 2.3 1.9 — — — 18.4 18.2 19.3 330 23.1 5.1
Jubilant Life Sciences 160 REDUCE 25,496 564 159 14.6 16.9 (0.6) (45.1) 15.9 (103.4) 11.0 9.5 (281.9) 9.6 7.7 6.7 1.2 1.1 1.0 1.2 1.6 2.2 11.9 12.1 — 220 37.5 0.9
Lupin 392 ADD 174,523 3,862 445 17.6 22.4 25.8 15.0 26.9 15.3 22.3 17.6 15.2 18.4 14.3 12.1 5.4 4.4 3.6 0.9 1.1 1.1 27.3 28.0 — 465 18.5 9.0
Ranbaxy Laboratories 467 SELL 200,041 4,427 428 23.4 20.3 21.9 231.8 (13.3) 7.6 19.9 23.0 21.4 14.6 15.3 14.6 3.6 3.1 2.7 — — — 19.5 13.9 13.0 365 (21.8) 9.8
Sun Pharmaceuticals 435 ADD 450,797 9,977 1,036 17.4 19.7 24.1 33.4 13.1 22.6 25.0 22.1 18.0 20.9 17.1 13.6 4.7 3.9 3.3 0.6 0.6 0.6 21.0 19.9 20.5 480 10.3 11.4
Pharmaceuticals Cautious 2,076,076 45,946 17.3 17.0 4.3 24.0 20.5 19.7 16.2 13.2 12.8 3.5 3.0 2.8 0.5 0.5 0.5 14.5 14.6 14.3
Property
DLF 221 ADD 379,652 8,402 1,714 10.0 13.8 22.4 (5.5) 37.3 62.7 22.1 16.1 9.9 14.2 11.8 7.4 1.2 1.2 1.1 1.3 2.2 2.2 5.5 7.3 11.1 265 19.7 37.2
Housing Development & Infrastructure 160 ADD 70,583 1,562 441 23.0 28.4 34.2 44.0 23.9 20.1 7.0 5.6 4.7 8.2 5.0 3.4 0.8 0.6 0.6 — — — 11.8 12.5 13.1 180 12.5 25.7
Indiabulls Real Estate 110 RS 44,350 982 402 3.1 8.5 15.5 (865.5) 178.9 81.5 36.2 13.0 7.1 50.6 15.0 6.6 0.4 0.4 0.4 — — — 1.0 2.9 5.1 — — 13.9
Mahindra Life Space Developer 368 BUY 15,028 333 41 21.0 29.7 35.0 9.8 41.1 18.0 17.5 12.4 10.5 14.8 8.7 6.6 1.5 1.3 1.2 1.1 1.2 1.4 8.8 11.4 12.2 435 18.1 0.4
Oberoi Realty 235 BUY 77,391 1,713 330 18.7 24.9 44.0 36.9 32.7 77.2 12.5 9.4 5.3 8.6 5.7 2.8 2.3 1.8 1.4 0.4 0.6 1.1 23.3 21.5 29.8 305 29.9 0.4
Phoenix Mills 177 BUY 25,587 566 145 6.1 7.6 11.6 48.6 24.2 51.4 28.7 23.1 15.3 21.7 16.6 11.5 1.6 1.5 1.4 0.8 1.1 1.1 5.7 6.7 9.6 300 69.8 0.5
Puravankara Projects 105 REDUCE 22,431 496 213 7.3 8.8 15.0 7.6 19.9 70.6 14.3 12.0 7.0 16.3 11.7 6.2 1.5 1.3 1.1 1.9 1.9 — 10.5 11.6 17.4 100 (4.9) 0.1
Sobha Developers 260 BUY 25,541 565 98 18.8 24.0 31.9 33.4 27.9 33.0 13.9 10.9 8.2 11.2 8.6 6.3 1.3 1.2 1.0 0.5 0.6 — 10.1 11.7 13.7 380 45.9 1.7
Unitech 38 RS 101,053 2,236 2,666 2.4 3.9 5.3 (21.3) 62.1 37.1 15.9 9.8 7.1 17.1 9.6 6.4 0.8 0.8 0.7 — — — 5.6 8.3 10.3 — — 36.6
Property Cautious 761,615 16,855 15.2 42.0 51.2 16.8 11.8 7.8 13.6 9.6 6.0 1.0 1.0 0.9 0.8 1.3 1.3 6.1 8.1 11.1

India Daily Summary - March 1
24
O/S Target
25
Sugar
Bajaj Hindustan 69 SELL 13,280 294 191 (7.9) 0.2 6.4 (343.6) (102.5) 3,238.8 (8.8) 359.9 10.8 10.2 6.1 4.4 0.6 0.6 0.6 1.0 1.0 1.0 (7.1) 0.2 5.8 80 15.3 4.4
Balrampur Chini Mills 70 ADD 17,973 398 257 0.8 8.3 8.4 (89.9) 974.0 1.0 90.3 8.4 8.3 12.1 5.3 4.4 1.3 1.2 1.0 0.6 0.6 0.6 1.5 14.8 13.1 90 28.6 3.6
Shree Renuka Sugars 70 REDUCE 46,819 1,036 670 8.8 4.4 4.2 164.5 (49.8) (4.2) 7.9 15.8 16.5 5.2 7.6 6.9 1.8 1.5 1.3 0.6 0.5 0.5 29.1 11.4 9.8 90 28.8 20.3
Sugar Cautious 78,072 1,728 (4.2) 11.6 21.3 16.9 15.2 12.5 7.6 6.5 5.3 1.3 1.2 1.0 0.7 0.6 0.6 7.7 7.7 8.2
Technology
HCL Technologies 458 REDUCE 322,784 7,144 705 22.8 29.6 34.1 30.3 29.4 15.3 20.1 15.5 13.4 12.2 9.6 8.2 4.1 3.5 3.0 1.6 1.7 1.8 21.7 24.5 24.4 440 (3.9) 11.6
Hexaware Technologies 56 BUY 16,209 359 291 3.0 5.7 6.5 (36.5) 90.9 14.4 18.8 9.8 8.6 13.7 6.7 5.3 1.7 1.5 1.3 2.7 2.2 2.7 9.4 16.1 16.3 68 22.1 5.6
Infosys Technologies 2,979 BUY 1,709,774 37,839 574 120.0 155.2 184.9 10.8 29.3 19.1 24.8 19.2 16.1 17.2 13.2 10.8 6.6 5.4 4.4 2.0 1.6 1.9 28.1 30.9 30.2 3,700 24.2 77.6
Mahindra Satyam 68 REDUCE 79,439 1,758 1,176 3.1 4.3 5.6 24.7 37.4 32.5 21.8 15.9 12.0 12.8 7.7 5.4 3.8 3.6 2.9 — — — 18.5 23.2 26.9 70 3.6 13.2
Mindtree 364 REDUCE 14,964 331 41 23.8 33.8 38.4 (54.5) 42.3 13.5 15.3 10.7 9.5 7.7 5.2 4.3 1.9 1.7 1.5 0.7 0.9 3.2 13.6 16.8 16.7 370 1.8 0.9
Mphasis BFL 385 SELL 81,054 1,794 211 51.8 37.3 38.1 18.8 (28.0) 2.2 7.4 10.3 10.1 6.3 7.5 6.4 2.5 2.0 1.7 1.0 1.2 1.3 38.6 21.6 18.6 420 9.2 10.6
Persistent Systems 365 BUY 14,608 323 40 36.8 34.3 40.2 27.9 (6.6) 17.2 9.9 10.6 9.1 7.4 5.3 4.3 1.9 1.6 1.4 0.9 1.3 1.7 20.9 16.6 16.9 520 42.4 0.5
Polaris Software Lab 178 SELL 17,767 393 100 19.5 19.5 21.5 26.8 0.3 9.8 9.1 9.1 8.3 7.3 6.1 5.5 1.7 1.5 1.3 2.1 2.2 2.3 20.5 17.7 17.0 175 (1.8) 5.0
TCS 1,098 BUY 2,149,006 47,560 1,957 44.4 54.0 62.7 26.4 21.6 16.1 24.7 20.3 17.5 18.3 14.2 11.9 8.4 6.9 5.7 1.6 2.0 2.3 37.4 37.2 35.6 1,350 23.0 46.4
Tech Mahindra 733 REDUCE 90,788 2,009 124 65.1 65.9 71.2 (0.1) 1.3 8.1 11.3 11.1 10.3 9.9 9.2 8.5 2.5 2.1 1.9 0.3 0.3 1.4 26.3 22.1 20.8 720 (1.7) 4.4
Wipro 443 ADD 1,084,974 24,012 2,447 21.7 25.6 28.4 15.2 17.7 11.2 20.4 17.4 15.6 15.0 12.1 10.5 4.5 3.8 3.2 1.0 1.2 1.4 24.4 23.7 22.0 525 18.4 17.1
Technology Attractive 5,641,999 124,864 17.4 20.1 15.4 21.8 18.1 15.7 15.7 12.4 10.5 5.7 4.8 4.0 1.7 1.6 1.9 26.3 26.2 25.3
Telecom
Bharti Airtel 318 REDUCE 1,207,067 26,714 3,798 17.1 21.3 24.9 (27.7) 24.6 16.7 18.6 14.9 12.8 9.1 7.2 6.0 2.5 2.1 1.8 — — — 14.3 15.3 15.4 305 (4.0) 30.4
IDEA 62 REDUCE 203,763 4,510 3,300 2.4 1.2 2.6 (11.2) (48.9) 107.7 25.4 49.8 24.0 8.9 7.8 6.3 1.7 1.6 1.5 — — — 6.9 3.5 6.8 55 (10.9) 6.3
MTNL 44 SELL 27,909 618 630 (10.4) (9.1) (8.4) (33.7) (11.9) (8.1) (4.3) (4.8) (5.3) (0.2) (0.3) (0.4) 0.3 0.3 0.3 — — — (6.1) (5.7) (5.5) 35 (21.0) 1.1
Reliance Communications 107 SELL 227,327 5,031 2,133 6.9 7.9 11.3 (65.2) 15.0 43.6 15.5 13.5 9.4 8.4 7.5 6.3 0.5 0.5 0.5 — — — 3.3 3.7 5.1 90 (15.6) 30.6
Tata Communications 209 REDUCE 59,594 1,319 285 15.2 15.7 15.9 8.2 3.5 1.5 13.8 13.3 13.1 6.4 6.0 5.7 0.8 0.8 0.8 3.6 4.1 4.3 5.5 5.5 5.4 225 7.6 0.9
Telecom Cautious 1,725,659 38,191 (38.9) 17.9 25.7 20.2 17.1 13.6 9.1 7.4 6.2 1.4 1.3 1.2 0.1 0.1 0.1 6.9 7.6 8.7
Utilities
Adani Power 113 ADD 246,340 5,452 2,180 2.8 16.5 20.0 252.0 500.1 20.7 41.0 6.8 5.7 34.9 6.5 4.7 3.9 2.5 1.7 — — — 9.9 44.1 35.8 140 23.9 3.9
CESC 311 BUY 38,811 859 125 36.6 42.7 51.6 5.8 16.8 20.7 8.5 7.3 6.0 5.4 6.2 5.9 0.8 0.8 0.6 1.5 1.7 1.9 10.2 10.8 11.6 459 47.8 1.1
JSW Energy 72 REDUCE 117,916 2,610 1,640 5.2 10.3 7.9 14.2 97.6 (22.8) 13.9 7.0 9.1 12.4 5.2 4.9 2.1 1.6 1.4 — — — 16.3 26.0 16.3 82 14.0 2.4
Lanco Infratech 36 BUY 80,028 1,771 2,223 3.1 4.9 5.1 44.5 59.8 3.1 11.7 7.3 7.1 11.5 7.6 7.4 1.9 1.4 1.2 — — — 17.9 22.0 18.1 65 80.6 8.8
NHPC 23 REDUCE 284,762 6,302 12,301 1.5 1.7 2.1 (19.4) 15.6 20.0 15.5 13.4 11.2 11.9 9.4 7.8 1.1 1.0 1.0 1.7 2.0 2.4 7.1 7.8 8.9 28 21.0 3.6
NTPC 176 REDUCE 1,447,491 32,035 8,245 10.1 11.9 13.5 (3.2) 17.6 12.8 17.3 14.7 13.0 15.9 12.3 11.4 2.1 1.9 1.8 2.0 2.3 2.6 12.6 13.7 14.2 195 11.1 8.6
Reliance Infrastructure 653 BUY 174,685 3,866 267 60.8 70.8 84.0 (1.9) 16.3 18.7 10.7 9.2 7.8 8.1 6.1 4.7 0.7 0.7 0.6 1.4 1.6 1.7 9.1 10.7 12.8 1,030 57.7 46.7
Reliance Power 125 SELL 350,915 7,766 2,805 2.9 4.0 2.5 0.1 38.4 (36.7) 43.8 31.6 50.0 240.5 51.7 20.2 2.2 2.0 1.9 — — — 5.2 6.6 4.0 115 (8.1) 13.5
Tata Power 1,228 ADD 303,150 6,709 247 70.7 84.4 110.6 11.3 19.4 31.0 17.4 14.5 11.1 12.4 11.5 8.4 2.2 1.9 1.7 1.1 1.2 1.4 13.0 14.0 16.2 1,415 15.2 8.0

Utilities Cautious 3,044,098 67,370 3.4 41.2 11.6 17.9 12.7 11.4 16.6 11.0 9.1 1.8 1.6 1.4 1.3 1.5 1.7 10.0 12.7 12.7
Others
Havells India 359 ADD 44,732 990 125 23.2 28.9 32.0 278.2 24.5 10.7 15.4 12.4 11.2 10.4 8.3 7.1 6.5 4.4 3.2 0.7 0.8 0.8 52.1 42.4 33.3 425 18.5 1.7
Jaiprakash Associates 83 BUY 183,015 4,050 2,214 5.1 5.6 5.4 188.8 11.6 (4.3) 16.4 14.7 15.3 12.4 10.9 10.6 1.9 1.7 1.6 — — — 12.2 12.1 10.6 135 63.3 30.0
Jet Airways 471 BUY 40,657 900 86 15.7 38.7 70.8 (122.5) 146.7 82.9 30.0 12.2 6.7 8.1 7.1 5.8 2.2 1.8 1.4 — — — 7.5 16.4 24.4 650 38.0 18.1
Sintex 144 SELL 39,127 866 272 14.8 16.1 18.1 22.1 9.0 12.6 9.7 8.9 7.9 8.4 7.3 6.5 1.6 1.3 1.1 0.9 1.0 1.0 16.0 14.9 14.4 140 (2.7) 7.2
SpiceJet 40 BUY 16,180 358 403 4.3 4.6 6.3 69.4 7.0 36.9 9.3 8.7 6.4 5.9 9.2 6.7 4.2 2.8 2.0 — — — 766.4 38.6 36.3 65 61.9 4.2
Tata Chemicals 327 REDUCE 79,448 1,758 243 26.8 35.4 44.2 1.5 31.9 24.8 12.2 9.2 7.4 6.0 4.6 3.6 1.5 1.3 1.1 2.9 2.9 3.7 16.9 19.3 — 370 13.3 3.4
United Phosphorus 136 BUY 62,713 1,388 462 12.9 17.6 20.7 8.3 37.3 17.1 10.5 7.7 6.6 5.4 4.3 3.5 1.6 1.4 1.2 1.4 1.5 1.8 17.5 19.4 19.1 220 62.2 5.8
Others 465,872 10,310 133.0 26.1 17.4 13.8 11.0 9.3 9.3 8.2 7.5 1.9 1.7 1.4 0.8 0.9 1.0 13.8 15.0 15.2
KS universe (b) 47,277,920 1,046,319 20.4 21.6 16.9 15.8 13.0 11.1 10.1 8.2 6.9 2.5 2.2 1.9 1.5 1.6 1.9 15.7 16.6 17.0
KS universe (b) ex-Energy 39,002,272 863,169 20.6 23.4 18.2 17.1 13.9 11.7 11.9 9.4 7.9 2.7 2.4 2.0 1.2 1.4 1.6 15.9 17.0 17.4
KS universe (d) ex-Energy & ex-Commodities 32,458,382 718,344 19.8 22.7 18.9 17.9 14.6 12.3 13.2 10.5 8.7 2.8 2.4 2.1 1.3 1.4 1.6 15.5 16.6 17.2
Notes:
(a) For banks we have used adjusted book values.
(b) 2010 means calendar year 2009, similarly for 2011 and 2012 for these particular companies.
(c) EV/Sales & EV/EBITDA for KS universe excludes Banking Sector.
(d) Rupee-US Dollar exchange rate (Rs/US$)= 45.19

Disclosures
Kotak Institutional Equities Research coverage universe

Distribution of ratings/investment banking relationships
Percentage of companies covered by Kotak Institutional Equities,
70% within the specified category.
60%
Percentage of companies within each category for which Kotak
Institutional Equities and or its affiliates has provided investment
50%
banking services within the previous 12 months.
40% * The above categories are defined as follows: Buy = We expect

32.1% 33.3% this stock to outperform the BSE Sensex by 10% over the next 12
30% months; Add = We expect this stock to outperform the BSE
23.1% Sensex by 0-10% over the next 12 months; Reduce = We expect
this stock to underperform the BSE Sensex by 0-10% over the
20%
next 12 months; Sell = We expect this stock to underperform the
11.5% BSE Sensex by more then 10% over the next 12 months. These
10% 5.1% 5.1% ratings are used illustratively to comply with applicable
3.2% regulations. As of 30/09/2010 Kotak Institutional Equities
0.6%
0% Investment Research had investment ratings on 156 equity
securities.
BUY ADD REDUCE SELL
Source: Kotak Institutional Equities As of September 30, 2010
Ratings and other definitions/identifiers

Definitions of ratings
BUY. We expect this stock to outperform the BSE Sensex by 10% over the next 12 months.
ADD. We expect this stock to outperform the BSE Sensex by 0-10% over the next 12 months.
REDUCE. We expect this stock to underperform the BSE Sensex by 0-10% over the next 12 months.
SELL. We expect this stock to underperform the BSE Sensex by more than 10% over the next 12 months.
Our target price are also on 12-month horizon basis.
Other definitions
Coverage view. The coverage view represents each analyst’s overall fundamental outlook on the Sector. The coverage view will consist of one of the following
designations: Attractive, Neutral, Cautious.
Other ratings/identifiers
NR = Not Rated. The investment rating and target price, if any, have been suspended temporarily. Such suspension is in compliance with applicable
regulation(s) and/or Kotak Securities policies in circumstances when Kotak Securities or its affiliates is acting in an advisory capacity in a merger or strategic
transaction involving this company and in certain other circumstances.
CS = Coverage Suspended. Kotak Securities has suspended coverage of this company.
NC = Not Covered. Kotak Securities does not cover this company.
RS = Rating Suspended. Kotak Securities Research has suspended the investment rating and price target, if any, for this stock, because there is not a sufficient
fundamental basis for determining an investment rating or target. The previous investment rating and price target, if any, are no longer in effect for this stock
and should not be relied upon.
NA = Not Available or Not Applicable. The information is not available for display or is not applicable.
NM = Not Meaningful. The information is not meaningful and is therefore excluded.

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Copyright 2011 Kotak Institutional Equities (Kotak Securities Limited). All rights reserved.
1. Note that the research analysts contributing to this report may not be registered/qualified as research analysts with FINRA; and
2. Such research analysts may not be associated persons of Kotak Mahindra Inc and therefore, may not be subject to NASD Rule 2711 restrictions on
communications with a subject company, public appearances and trading securities held by a research analyst account.
Kotak Securities Limited and its affiliates are a full-service, integrated investment banking, investment management, brokerage and financing group. We along with
our affiliates are leading underwriter of securities and participants in virtually all securities trading markets in India. We and our affiliates have investment banking
and other business relationships with a significant percentage of the companies covered by our Investment Research Department. Our research professionals
provide important input into our investment banking and other business selection processes. Investors should assume that Kotak Securities Limited and/or its
affiliates are seeking or will seek investment banking or other business from the company or companies that are the subject of this material and that the research
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the profitability of Kotak Securities Limited, which include earnings from investment banking and other business. Kotak Securities Limited generally prohibits its
analysts, persons reporting to analysts, and members of their households from maintaining a financial interest in the securities or derivatives of any companies that
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This material should not be construed as an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would
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INDIA DAILY

March 18, 2011 India 17-Mar 1-day1-mo 3-mo

Sensex 18,150 (1.1) (1.9) (8.6)

Nifty 5,447 (1.2) (1.8) (8.4)

New release Dow Jones 11,775 1.4 (4.4) 2.5

Value traded – India

Crude prices: Predictions are meaningless in the current scenario

Refining margins: Expectations seem to have run ahead of fundamentals

We expect supply-demand imbalance to remain through CY2011-12E as incremental global

Company data and valuation summary QUICK NUMBERS

Break-up of profits (Rs mn)

FY2010 FY2011E FY2012E FY2013E

Source: Kotak Institutional Equities estimates, Company

4 KOTAK INSTITUTIONAL EQUITIES RESEARCH

Profit and loss statement, March fiscal year-ends, 2008-2013E

2008 2009 2010 2011E 2012E 2013E

Source: Kotak Institutional Equities estimates, Company

Balance sheet, cash model, March fiscal year-ends, 2008-2013E

2008 2009 2010 2011E 2012E 2013E

Free cash flow

Source: Kotak Institutional Equities estimates, Company

KOTAK INSTITUTIONAL EQUITIES RESEARCH 5

Company data and valuation summary

Key takeaways from analyst meet

` The company indicated its intention to focus on premiumisation in most categories—chocolates

Nestle is nervous to face competition in noodles category, in our view

At 35X FY2012E, there is no room for execution risk. Retain REDUCE

Nestle has never had to face severe competition in its categories

Market share (%)

Source: Kotak Institutional Equities

KOTAK INSTITUTIONAL EQUITIES RESEARCH 7

2006 2007 2008 2009 2010E 2011E 2012E

Balance sheet (Rs mn)

Free cash flow (Rs mn)

Source: Kotak Institutional Equities estimates

8 KOTAK INSTITUTIONAL EQUITIES RESEARCH

Company data and valuation summary

Comparison of sales growth in CY2010 (%)

Sales growth in US$ (%)

Source: Kotak Institutional Equities estimates, Company

Components of sales growth, FY2009-FY2011E, (%)

Price Volume Exchange rate

Source: Kotak Institutional Equities estimates, Company

10 KOTAK INSTITUTIONAL EQUITIES RESEARCH

Sales growth by geography, (%)

FY2010 1QFY11 2QFY11 3QFY11 4QFY11E FY2011E FY2012E

Source: Kotak Institutional Equities estimates, Company

Brazil underperforms in 2010; UPL enters Brazil through recent acquisition

Sipcam Isagro Brazil (50% share of Isagro), (Euro mn)

9M2010 2009 2008

EBITDA, % recovery of margin in Brazilian JV 2 17

higher financial charges for Sipcam

Source: Kotak Institutional Equities estimates, Company

KOTAK INSTITUTIONAL EQUITIES RESEARCH 11

2008 2009 2010 2011E 2012E 2013E

Source: Kotak Institutional Equities estimates, Company

UPL—balance sheet statement, March fiscal year-ends, 2008-2013E (Rs mn)

2008 2009 2010 2011E 2012E 2013E

Source: Kotak Institutional Equities estimates, Company

12 KOTAK INSTITUTIONAL EQUITIES RESEARCH

Liquidity to be at a comfortable level; reining in inflation expectations primary aim of RBI

RBI to stay hawkish; likely to continue with hikes of 25 bps