gladiator stocks – capital goods thematic: performance...

Gladiator Stocks – Capital Goods Thematic: Performance to rev upto rev up...

Scrip I-Direct Code Action Target StoplossLarsen & Toubro LARTOU Buy in the range of 1690-1720 2035.00 1540.00CG Power and Industrial Solutions CROGRE Buy in the range of 79-82 98.00 73.00BGR Energy Systems BGRENE Buy in the range of 168-175 210.00 152.00Time Frame: 6 Months

Research AnalystsDharmesh Shah [email protected] Pabitro Mukherjee [email protected] Kunte CMT nitin kunte@icicisecurities com Vinayak Parmar vinayak parmar@icicisecurities comNitin Kunte, CMT [email protected] Vinayak Parmar [email protected] Dagha [email protected]

May 9, 2017

Deal Team – At Your ServiceCapital Goods Thematic: Performance to rev up...

After a dull period of financial performance over FY11-16, we expect companies in the capital goodsspace to exhibit a strong recovery in earnings backed by a pick-up in order inflows across key segments,improved execution and better working capital management. In terms of order inflows, governmentbacked segments like roads power T&D railways urban infra & transportation and defence have led to abacked segments like roads, power T&D, railways, urban infra & transportation and defence have led to asurge in order inflows. The same is expected to continue in FY18E as well. In such a scenario, we wouldprefer diversified capital goods players, which are present across the above segments, have strongexecution skills and command relatively robust cash flow and leverage profile.

To capitalise on this emerging theme we have identified actionable opportunities based on our technical screener model, which focuses on identifying the following three broad categories of stocks:

Relative outperformers with robust price structuree at e outpe o e s t obust p ce st uctu e

Major turnarounds in price structure

Underperformers that are poised at an attractive value area

In this edition of our Capital Goods Thematic series, we are looking at Larsen & Toubro, CG Power & Industrial Solutions and BGR Energy.

2

Larsen & Toubro (LARTOU): Faster retracement of previous decline augurs well...

CMP | 1710 00 B i R | 1690 1720 T t | 2035 00 St l | 1540 00 U id 19%

Technical ViewThe capital goods and engineering behemoth Larsen & Toubro has begun a steady uptrend after concluding a healthycorrective phase of two years between 2015 and 2016. The formation of higher high and higher low onmonthly/quarterly scale along with faster retracement of last falling segment signals a bullish structural turnaround

d id d b i t it f di t ti

Stock Data

CMP: | 1710.00 Buying Range: | 1690-1720 Target: | 2035.00 Stop loss: | 1540.00 Upside: 19%

52 Week High / Low 1774/1223.350 days EMA 1629

200 days EMA 1502 and provides good buying opportunity from medium term perspectiveFaster retracement of last falling segment confirms a structural turnaroundAfter witnessing a sizable price correction of over 46% from its all-time peak of | 1893 between March 2015 andFebruary 2016, the stock entered into a gradual up move to retrace the preceding fall by around 61.8% by July 2016.The corresponding decline in the second half of 2016 got anchored at the key value area placed around | 1300 regionbeing the confluence of following:

The long term 200 week EMA was then placed around |1348 region

*Recommendation given on i-click to gain on May 09,2017 at 09:23 hrs

200 days EMA 1502

52 Week EMA 1498

Face Value (|) 2Market Capitallisation (| Cr.) 159496

g p g50% retracement of the February – July 2016 up move was around |1310 region.

The stock attracted strong demand at the value area of | 1300 at the start of CY17. The ensuing up move hasconfirmed a major higher bottom in place at | 1300. In the process, it has also resulted in faster retracement of theJuly-December 2016 fall (| 1615 to | 1302) as the five month decline was completely overhauled in less than fourmonths. Faster retracement of the major down move and formation of higher high and higher low onmonthly/quarterly scale confirms a bullish structural turnaround indicating conclusion of the two year corrective phase

d ti f th i t d

Stock price vs. BSE Sensex

24,000

26,000

28,000

30,000

1,3001,4001,5001,6001,7001,800

and resumption of the primary uptrendWe believe the lower band of rising channel formed by joining the major lows of February and December 2016,placed around | 1540 over the coming months will act as a strong base for the stock, going forward. This alsocoincides with the 50% retracement of the December 2016 to April 2017 up move placed around 1540 levels.

Momentum oscillator confirms inherent strength in trend...Among oscillators, the weekly MACD that measured the strength in an underlying trend is in rising trajectory. Also, iti di i f it i i d ft b di f it t i li i di ti t th i th t

Price performance in last five years

22,0001,200,300

May

-16

Jun-

16Ju

l-16

Aug

-16

Sep-

16Oc

t-16

Nov

-16

Dec-

16Ja

n-17

Feb-

17M

ar-1

7A

pr-1

7M

ay-1

7

Larsen&Toubro BSE Sensex

is diverging from its nine period average after rebounding from its trigger line indicating strength in the current upmove and augurs well for continuance of the upward momentum over the coming months.ConclusionBased on the aforementioned technical observations, we believe the stock has concluded a two year corrective phaseand is set to embark upon a sustainable up move over the medium term. We expect the stock to head towards targetof | 2035 over the medium term as it is the confluence of upper band of major rising channel in place since February2016 and 123.6% Fibonacci price extension of the February-July 2016 up move projected from the November 2016

62%

0%

40%

-15%6%

-50%

0%

50%

2012 2013 2014 2015 2016higher bottom of | 1295 provides target of | 2035 from a medium term horizon.

Source: Bloomberg, BSE, ICICIdirect.com Research

3

2012 2013 2014 2015 2016Year

Larsen & Toubro (LARTOU): Weekly Bar Chart

Stock has begun a strong uptrend forming higherhigh/higher lows while moving in an up trending channel

123.6% extension ofprevious up move @ 2035

1893

Support base @ 15401615

5 month decline

Fasterretracementi 4 h

Value area of 1300 being confluenceof key technical parameters:- 200 week EMA- 50% retracement of previous

major rally (|1016 to |1615)

1295in 4 months

1016major rally (|1016 to |1615)

- Lower band of rising channel

Weekly MACD is in rising trajectory after reboundingfrom it trigger line supporting the uptrend in price

Source: Bloomberg, ICICIdirect.com Research

4

Stock Data

Larsen & Toubro (LARTOU): Fundamental view

Fundamental ViewStock Data Fundamental ViewMacro sensitivity does impact L&T’s prospects but intensity moderatingL&T’s order inflow have scaled up ~8x in FY04-15, representing a robust CAGR of 23% in the same period. Inabsolute terms, L&T’s order inflows were at | 13,200 crore in FY04, which eventually scaled up to| 126500 crore by FY15 (excluding hydrocarbon business). This outsized growth in order flows is attributable to ahigh quality management, superior and timely execution track record, capability to execute mega sized projectsacross segments, stringent risk management techniques, timely diversification across sectors/geographies andcredible reputation among private sector clients Revenue growth as percentage of GDP growth has averaged at

Particular AmountMarket Capitalization | 161857.5 CroreTotal Debt (FY16) | 11336.2 CroreCash and Investments (FY16) |5823 CroreEV | 110196.1 Crore52 week H/L |1893/ | 1069 credible reputation among private sector clients. Revenue growth as percentage of GDP growth has averaged at

1.4x while order inflow growth as a percentage of GDP growth has averaged at 1.7x in FY05-14. Going ahead, eventhough capital formation is weak, we expect L&T to maintain a ratio of 1.2x and 1.5x with respect to revenues andorder inflows vis-à-vis GDP growth. We expect L&T to report revenue CAGR of 12.8% in FY16-18E, on a high base.We expect L&T to report standalone revenues of | 65509 crore and | 76018 crore in FY17E and FY18E, respectively.

Diversity: L&T’s biggest USP both during up/down turns in capex cycleKey Metrics

52 week H/L |1893/ | 1069Equity capital | 185 CroreFace value | 2

FY15 FY16 FY17E FY18EL&T’s current order backlog of | 258000 crore (Q3FY17, excluding hydrocarbon & services) is highly diversifiedacross segments and geographies. Out of the current backlog, the infrastructure segment (roads, buildings &factories, urban infra, airports) comprises 75% of the backlog whereas power (generation & T&D) and process(metals & material handling) segment’s share is at 6% and 3%, respectively. Others (defence, shipbuilding andelectronic products), on the other hand, constitute 8% of the backlogPAT CAGR of 12.9% in FY16-18E owing to pick-up in execution cycle, gradual uptick in EBITDA margins in FY18EWe expect revenue CAGR of 12.8% in FY16-18E while EBITDA CAGR over the same period is expected at 14.9%.

FY15 FY16 FY17E FY18EP/E 34.1 34.2 32.5 26.8 Target P/E 28.7 28.8 27.4 22.6 EV / EBITDA 26.0 26.6 24.8 20.6 P/BV 4.6 4.3 4.0 3.6 RoNW (%) 13.6 12.5 12.2 13.6 RoCE (%) 11.9 10.1 10.1 11.6 p p p

Our PAT CAGR in FY16-18E was at ~12.9% as we have assumed a moderate rise in other income component inFY16E-18E over FY15 while depreciation is expected to exhibit a CAGR of ~7%. Hence, we expect L&T’s PAT at| 6030.8 crore in FY18E vs. | 4729 crore in FY16.RoEs: Key for shareholder value creation by monetising subsidiariesRoEs of the standalone base business used to average between 24% and 27% in FY08-10 but the same hasdeclined to 16-17% in FY11-13 as L&T’s investments in BOT assets (road, power, urban infra) rose from | 5740 crorein FY10 to | 15168 crore in FY14 Going ahead we expect L&T to report RoEs in the range of 13-14 5% for the

Financial Highlights

| Crore FY15 FY16 FY17E FY18ENet Sales 57,017.4 59,779.6 65,509.8 76,017.6 EBITDA 6,487.9 6,182.1 6,742.2 8,161.0 Net Profit 4 746 8 4 728 7 4 974 0 6 030 8 in FY10 to | 15168 crore in FY14. Going ahead, we expect L&T to report RoEs in the range of 13 14.5% for the

standalone business over FY16-18E. However, the scenario may drastically change in FY19-20, as 1) L&T hasalready divested entire stake in Dhamra port, which will free up equity required in developmental portfolio, 2) L&Thas signalled a possible sale of 20-25% stake in IDPL wherein it has already roped in a strategic investor to the tuneof | 2000 crore of equity 3) losses of shipbuilding business (| 335 crore in FY14) will reduce significantly to | 100crore in FY17E and if the capex cycle recovers in time with opening up of the defence sector, these subsidiaries willturn into black by FY18E and 4) the company is close to selling its Nabha power plant, general insurance businessand also restructure L&T IDPL These actions, in our view, will be RoE accretive by FY18E onwards

Source: Company, ICICIdriect.com Research

Net Profit 4,746.8 4,728.7 4,974.0 6,030.8 EPS (|) 51.3 51.1 53.8 65.2

and also restructure L&T IDPL These actions, in our view, will be RoE accretive by FY18E onwards

5

CG Power and Industrial Solutions (CROGRE): Bullish Flag breakout...

CMP | 82 00 B i R | 79 82 T t | 98 00 St l | 73 00 U id 22%

Technical ViewCG Power and Industrial Solutions is an Indian multinational company engaged in design, manufacturing andmarketing of products related to power generation, transmission, and distribution. It has 16 manufacturing divisionsspread across India and 10 outside India. The stock has seen a sizable correction of more than 30% from the August2016 hi h f | 88 d tl b d d d i J 2017 f i b d th | 56 60 Th h

Stock Data


52 Week High / Low 88.90/55.6050 days EMA 76

200 days EMA 71 2016 high of | 88 and recently rebounded during January 2017 forming base around the | 56-60 range. The sharp upmove during January to March 2017 followed by consolidation during April 2017 signals conclusion of the correctivetrend and offers fresh opportunity for investor to ride the next up leg in the stockBreakout from Bullish Flag pattern signal continuation of the uptrendThe sideways consolidation in the last five weeks took the pictorial form of a Flag pattern. A Flag formation is a bullishcontinuation price pattern, which marks a temporary pause in momentum after an up move as bulls takes a breatherbefore continuance of the primary uptrend. The breakout from the Flag pattern reinstates the prevailing uptrend and


200 days EMA 71

52 Week EMA 71


augurs well for the stock, going forward. The price up move in the current week’s trade has seen the stock register aresolute breakout from the bullish Flag pattern with significant high volume of more than double of the 200 daysaverage volume of 35 lakh share per day indicating larger participation at the breakout levels and offers fresh entryopportunity for the medium term investorsThe base of the Flag pattern is placed at the major support area of | 56-60 being the confluence of the followingtechnical parameters:

The 61.8% retracement of the entire 2016 rally during February-August 2016 (40 to 88) is placed at 58 region

Stock price vs. BSE 500

9 00010,00011,00012,00013,00014,00015,000

55

65

75

85

The 61.8% retracement of the entire 2016 rally during February August 2016 (40 to 88) is placed at 58 regionThe rising 200 weeks EMA was also placed around | 60 levels

Time wise behaviour quantifies robust price structureTime wise, the last major up move during March to August 2016 from | 40 to | 88 levels consumed six months,whereas the stock has already spent over eight months under current consolidation while retracing just 61.8% of theprevious gains. Limited price wise correction and extended time wise consolidation highlights the overall positiveprice structure.Price performance in last five years

8,0009,000

45

May

-16

Jun-

16Ju

l-16

Aug

-16

Sep-

16Oc

t-16

Nov

-16

Dec-

16Ja

n-17

Feb-

17M

ar-1

7A

pr-1

7M

ay-1

7

CG Power BSE 500

Momentum oscillator confirms inherent strength in trend...Among oscillators, the weekly MACD (E-12/26/9) is in rising trend forming higher high and has recently ventured intopositive territory signalling strength in the price trend and augurs well for continuance of the uptrendConclusionBased on the aforementioned technical observations, we expect the stock to continue with its fresh uptrend postbreakout from the bullish Flag pattern and head towards | 99 levels over the medium term, as it is the measuringimplication of the of the breakout from the Flag pattern being the price parity with the previous up move from | 56 to

-8% 11%

46%

2% -11%

-50%

0%

50%

2012 2013 2014 2015 2016 implication of the of the breakout from the Flag pattern being the price parity with the previous up move from | 56 to| 80 (80-56=24 points) added to the recent trough of | 75 (75+ 24=99) project upside towards | 99 levels in themedium termSource: Bloomberg, BSE, ICICIdirect.com Research

6

Year

CG Power and Industrial Solutions: Weekly Bar Chart

Bullish Flag breakout offers fresh entry opportunity for mediumterm investors to ride the next up move in the stock

Measuring implication ofFlag breakout @ 99

80

88

75

8080

40

Base of the Flag pattern is placed at the200 weeks EMA and the 61.8%retracement of the previous major rally of2016 (| 40 80) indicating positive price

56

2016 (| 40-80) indicating positive pricestructure

Weekly MACD is in rising trend forming higher high and has recently ventured into positiveterritory signalling strength in the price trend


7

BGR Energy Systems (BGRENE): Bullish turnaround in sight…

CMP | 173 00 B i R | 168 175 T t | 210 00 St l | 152 00 U id 22%

Technical ViewBGR Energy Systems operates in the utility industry, offering services ranging from product manufacturing to projectexecution. The company operates in two segments: capital goods, construction and engineering procurementconstruction (EPC) contracts. The stock has been an underperformer within the capital goods space over a prolonged

i d d h b d j b f ti h th l t t Th k d l t i

Stock Data


52 Week High / Low 183.40/99.2050 days EMA 154

200 days EMA 133 period and has been under a major base formation phase over the last two years. The key developments on pricefront in the last couple of months has led to a bullish resolution past two year base formation range, indicating earlysigns of a structural turnaround and provides good buying opportunity from medium term perspectiveBreakout from major Triangular pattern and two year consolidationThe share price of BGR Energy entered into a major consolidation phase after plummeting to an all time low of | 70 inJuly 2013. The entire price movement since 2013 till recently has occurred in a well defined Triangular pattern ashighlighted in the adjoining weekly chart. Over the last two years, the stock witnessed a major base formation at the


200 days EMA 133

52 Week EMA 132


lower boundary of triangular consolidation pattern while oscillating between the broad range of | 95 to | 150 levels. Itis a sign of the share price absorbing all the prevailing negative sentiments and forming a major base that will act as alaunchpad for the fresh up move upon successful resolution past the consolidation. The strong up move at the start ofApril 2017, triggered a bullish structural turnaround as the stock registered a resolute breakout past its key overheadhurdle placed around |150-160 regions being the confluence of following:

The upper boundary of triangular consolidation pattern was placed around 160Long term 200 week EMA was also placed around |158 region

Stock price vs. BSE Sensex

10,000

12,000

14,000

16,000

18,000

105

125

145

165

Long term 200 week EMA was also placed around |158 regionUpper band of two year consolidation range was placed around |150

After the strong breakout rally in the first week of April 2017, the stock is seen consolidating above the breakout areaof |160 over the five weeks. This represents a bullish Flag pattern on the weekly chart as the stock is gathering steambefore continuance of the upward momentum. We believe the recent breakout area of | 150, which also coincideswith the rising 50 day EMA currently placed around | 152 region and 61.8% retracement of last rising segment placedaround 152 will act as a strong base for the stock going forward.Price performance in last five years

8,00085

May

-16

Jun-

16Ju

l-16

Aug

-16

Sep-

16Oc

t-16

Nov

-16

Dec-

16Ja

n-17

Feb-

17M

ar-1

7A

pr-1

7M

ay-1

7

BGR Energy BSE 500

Momentum oscillator confirms inherent strength in trend...Among oscillators, the weekly MACD is in rising trajectory above its trigger line while the MACD on monthly charthas ventured into positive territory above its trigger line for the first time in June 2011 indicating strength in thecurrent up move and augurs well for continuance of the upward momentum over the coming months.ConclusionBased on the aforementioned technical observations, we believe the stock offers a good entry opportunity with afavourable risk/reward to ride the fresh up move over the medium term We expect the stock to head towards | 210

52%

-48%29%

-19% -14%

-60%

-10%

40%

2012 2013 2014 2015 2016 favourable risk/reward to ride the fresh up move over the medium term. We expect the stock to head towards | 210levels over the medium term as it is the price wise equality of last rising segment (133 to 183=50 points) projectedfrom recent trough of | 160 provides upsides towards | 210 levels over the medium term.Source: Bloomberg, BSE, ICICIdirect.com Research

8

2012 2013 2014 2015 2016Year

BGR Energy Systems (BGRENE): Weekly Bar Chart

Breakout past major Triangular consolidation pattern andlong term 200 week EMA provides good entry opportunity

200 week EMA

Equality with last risingsegment @ 210

155

95

Base formation atlower band of majorjTriangular pattern

Strong volumes accompanying price breakouthighlight larger participation in the direction of trend

Weekly MACD is in rising trajectory above its triggerline supporting the breakout on price front


9

Strategy Follow up

Open Recommendations:

Date Scrip Name Rec Price Target Stoploss CMP Return till date (%)

20-Mar-17 IDBI 75 98 66 78 4.0%23 Mar 17 GMDC 121 154 102 127 5 0%23-Mar-17 GMDC 121 154 102 127 5.0%11-Apr-17 JK Lakshmi 455 542 405 495 8.8%11-Apr-17 Heidelberg Cement 126 150 109.5 133 5.6%11-Apr-17 Ashoka Buidcon 208 258 184 206 -1.0%18-Apr-17 EIH Ltd 127 152 112 134 5.5%21-Apr-17 Cera Sanitaryware 2934 3680 2520 3000 2.2%21-Apr-17 VST Tillers 1880 2285 1660 1985 5.6%p VST Tillers 880 85 660 1985 5 6%21-Apr-17 Monsanto 2570 3060 2280 2595 1.0%27-Apr-17 Nestle India 6520 7750 5875 6695 2.7%27-Apr-17 Emami 1035 1250 910 1091 5.4%3-May-17 Cummins India 1070 1250 970 1076 0.6%4-May-17 Vadilal Industries 930 1245 810 981 5.5%

Summary Performance - Recommendations till date Open Recommendations 13Total Recommendations 153 Yield on Positive recommendations 20.0%Closed Recommendations 140 Yield on Negative recommendations -8.0%Positive Recommendations 105S ik R %Strike Rate 75%

10

Notes…

• It is recommended to enter in a staggered manner within the prescribed range provided in the report

• Once the recommendation is executed, it is advisable to keep strict stop loss as provided in the report on closing basis.

• The recommendations are valid for six months and in case we intend to carry forward the position, it will be communicated through separate mail.

Trading portfolio allocationTrading portfolio allocation

• It is recommended to spread out the trading corpus in a proportionate manner between the various technical research products

• Please a oid allocati g the e ti e t adi g co p s to a si gle stock o a si gle p od ct • Please avoid allocating the entire trading corpus to a single stock or a single product segment

• Within each product segment it is advisable to allocate equal amount to each recommendationF l Th ‘D il C ll ’ d i 3 i d d i I i • For example: The ‘Daily Calls’ product carries 3 to 4 intraday recommendations. It is advisable to allocate equal amount to each recommendation

11

Recommended product wise trading portfolio allocation

Duration

Daily Calls 8% 2-3% 3-4 Stocks 0.5-1% 2-3% Intraday

Number of CallsReturn Objective

Frontline Stocks Mid Cap StocksProduct Product wise

allocation

AllocationsMax allocation in

1 Stock

Stocks on the Move 6% 3-5% 7-10 Per Months 7-10% 10-15% 3 Months

Weekly Calls 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week

Weekly Technicals 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week

Monthly Call 15% 5% 2-3 Stocks 7-10% 10-15% 1 Month

Monthly Technical 15% 2-4% 5-8 Stocks 7-10% 10-15% 1 Month

Techno Funda 15% 5-10% 1-2 Stocks 10% and above 15% and above 6 Months

Gladiator Stocks 15% 5 10% 1 2 Stocks 15% and above 20% and above 6 MonthsGladiator Stocks 15% 5-10% 1-2 Stocks 15% and above 20% and above 6 Months

Cash 10% -100%

12

Pankaj Pandey Head – Research [email protected]

ICICIdirect.com Research Desk,ICICI Securities Limited,1st Floor Akruti Trade Centre1st Floor, Akruti Trade Centre,Road No 7, MIDCAndheri (East)Mumbai – 400 [email protected]

13

DisclaimerANALYST CERTIFICATION

We /I Dharmesh Shah Dipesh Dagha Nitin Kunte Pabitro Mukherjee Vinayak Parmar Research Analysts authors and the names subscribed toWe /I, Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee, Vinayak Parmar Research Analysts, authors and the names subscribed tothis report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) orsecurities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) orview(s) in this report.Terms & conditions and other disclosures:ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stockbrokering and distribution of financial products. ICICI Securities Limited is a SEBI registered Research Analyst with SEBI Registration Number –g p g y gINH000000990.ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India’s largest private sector bank and has its varioussubsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management,etc. (“associates”), the details in respect of which are available on www.icicibank.comICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India.We and our associates might have investment banking and other business relationship with a significant percentage of companies covered by ourInvestment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts and their relatives from

i i i fi i l i i h i i d i i f i h h lmaintaining a financial interest in the securities or derivatives of any companies that the analysts cover.The information and opinions in this section have been prepared by ICICI Securities and are subject to change without any notice. The report andinformation contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to,copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ICICISecurities. While we would endeavour to update the information herein on reasonable basis, ICICI Securities is under no obligation to update orkeep the information current. Also, there may be regulatory, compliance or other reasons that may prevent ICICI Securities from doing so. Non-rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicablerated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicableregulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this company, or incertain other circumstances.The research recommendations are based on information obtained from public sources and sources believed to be reliable, but no independentverification has been made nor is its accuracy or completeness guaranteed. These research recommendations and information herein is solely forinformational purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities orother financial instruments. ICICI Securities will not treat recipients as customers by virtue of their receiving these recommendations. Nothing inthis section constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriateto your specific circumstances. The securities discussed and opinions expressed herein may not be suitable for all investors, who must maketheir own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not betaken in substitution for the exercise of independent judgment by any recipient. The recipient should independently evaluate the investment risks.The value and return on investment may vary because of changes in interest rates, foreign exchange rates or any other reason. ICICI Securitiesaccepts no liabilities whatsoever for any loss or damage of any kind arising out of the use of these recommendations. Past performance is notnecessarily a guide to future performance Investors are advised to see Risk Disclosure Document to understand the risks associated before

14

necessarily a guide to future performance. Investors are advised to see Risk Disclosure Document to understand the risks associated beforeinvesting in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are notpredictions and may be subject to change without notice.

DisclaimerICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have beenmandated by the subject company for any other assignment in the past twelve months.ICICI Sec ities o its associates ight ha e ecei ed a co pe satio f o the co pa ies e tio ed he ei d i g the pe iod p ecedi gICICI Securities or its associates might have received any compensation from the companies mentioned herein during the period precedingtwelve months from the date of these recommendations for services in respect of managing or co-managing public offerings, corporate finance,investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchantbanking or brokerage services from the companies mentioned herein in the past twelve months.ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICISecurities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or thirdSecurities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or thirdparty in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts and their relatives haveany material conflict of interest at the time of publication of this reports.It is confirmed that Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee and Vinayak Parmar, Research Analysts giving theserecommendations have not received any compensation from the companies mentioned herein in the preceding twelve months.Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactionsICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the

/ i i d h i f h l d f h h di h bli i f h h d icompany/companies mentioned herein as of the last day of the month preceding the publication of these research recommendations.Since Associates (ICICI group companies) of ICICI Securities are engaged in various financial service businesses, they might have financialinterests or beneficial ownership in various companies including the subject company/companies mentioned herein.It is confirmed that Research Analysts do not serve as an officer, director or employee or advisory board member of the companies mentionedherein.ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented herein.Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned hereinNeither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned herein.We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysisactivities.This report or recommendations are not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of orlocated in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law,regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securitiesdescribed herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession thisdocument may come are required to inform themselves of and to observe such restriction.

15

gladiator stocks – capital goods thematic: performance...

Documents