NIIT Tech Ltd

NIIT Technologies Ltd.
BUY
- 1 of 21 - Wednesday 23
rd
September, 2015
This document is for private circulation, and must be read in conjunction with the disclaimer on the last page.
STOCKPOINTER
Target Price `644 CMP `440 FY17E P/E 9.6x
Index Details NIIT Tech has undertaken several initiatives which, in our opinion,
are expected to put it on the growth trajectory again. The acquisition
of “Incessant Technologies” besides providing traction to revenues
and profitability will help it bolster the fast growing digital services
business and make inroads into new accounts. The significant
reinforcement and changes in front end leadership functions and a
new sales incentive policy are aimed at rewarding improved
performances and we believe, lead to a resurgent work force.
We initiate with a BUY coverage on NIIT Tech Ltd with a Price
Objective of `644 (potential upside of ~47% over a period of 18
months), implying a P/E multiple of 14x on its FY17E EPS. At the
CMP of `440, the stock is trading at 9.6x its EPS for FY17E.
Our optimism stems from the fact that:
 NIIT Tech is looking forward to expanding its presence in the
international markets (revenue share estimated to increase
from 87% in FY15 to 91% in FY17) by acquiring 17 new logos in
various verticals to bolster revenue growth and improve its
margins. International revenues are expected to grow at a
CAGR of 14% to ` 2,734 crores leading to an overall revenue
growth of 12% CAGR to ` 2,996 crores by FY17 driven by:
 Boost to the Travel and Transportation business which
is estimated to grow at a 12% CAGR to `1,195 crores.
 Accentuation of revenues from the BFSI vertical to
`1,058 crores (2 year CAGR of 17%).
 Expansion of business from IMS service line to `578
crores growing at a CAGR of 28%.
 The conscious de-focus from government business in India
should lead to a sharp improvement in operating margins by
380 bps to 18% while DSO days are also set to improve to 80
days from the current 93 days.
Sensex 25,652
Nifty 7,812
BSE 500 10,315
Industry
IT
Consulting
Scrip Details
Mkt Cap (` cr) 2,689
BVPS (`) 222
O/s Shares (Cr) 6.1
Av Vol (Lacs) 0.3
52 Week H/L 539/332
Div Yield (%) 1.8
FVPS (`) 10
Shareholding Pattern
Shareholders %
Promoters 30.9
DIIs 24.0
FIIs 28.1
Public 17.0
Total 100.0
NIIT Tech vs. Sensex
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16-Sep-14
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NIIT Tech Sensex
Key Financials (` Cr.)
Y/E Mar
Net
Sales
EBITDA PAT
EPS
(`)
EPS Growth
(%)
RONW
(%)
ROCE
(%)
P/E
(x)
EV/EBITDA
(x)
2014 2305 354 231 38.0 8.5 19.1 31.7 11.6 6.9
2015E 2372 336 114 18.7 -50.8 8.5 26.2 23.5 7.2
2016E 2659 439 203 33.3 78.1 14.3 31.9 13.2 5.6
2017E 2996 540 281 46.0 38.3 17.7 34.9 9.6 4.1

- 2 of 21- Wednesday 23
rd
September, 2015
 McKinsey expects global spending on digital services to grow
from the current 9% to 36% by FY18. Given NIIT Techs thrust on
this segment and the acquisition of Incessant (51% stake) augurs
well for the company. Besides plugging a vital gap in its service
offering the Incessant acquisition is expected to improve new
client adds and revenue potential through cross selling. Incessant
Technologies revenues (~ $17 Mn in FY15) are estimated to grow
at a robust 20% CAGR over FY15-17. Also, it operates at
significantly high margins of ~25%.
 The company has undertaken a list of new operating initiatives
such as:
 Identifying ‘Must have Accounts’ and growing top accounts
 Reinforcement and changes in front end leadership
positions
 Introduction of new sales incentive policy
These measures are expected improve its efficiencies and reduce
its employee cost / sales by 140bps to 55.1%.

rd
September, 2015
Company Background
NIIT Technologies was established as a software services arm of NIIT in 1981. It
demerged in 2004 and there onwards, NIIT Tech has expanded in various
geographies through various verticals and provides a number of IT Based
Services. Its Revenue Breakup is charted below:
Revenue Breakup FY15
Source: Ventura Research
Revenues
`2,372
Crores
America
44%
EMEA
36%
India
13%
Others
7%
ADM
61% SI & PI
7%
BPO
6%
IMS
17%
IP Based
9%
Others
15%
Govt
5%
Transportation
40%
Mfg
7%
BFSI
33%
Service Line Wise
Vertical Wise
Geography Wise
Margins wise Classification
Service Lise Wise Vertical Wise Geography wise
IP Based Transportation USA
IMS BFSI Europe
ADM Manufacturing MEA
SI & PI Others Others
BPO Govt India
Source: NIIT Tech, Ventura Research
High Margins
Low Margins

rd
September, 2015
 Key Investment Highlights
 Focus on international operations and scaling down of India government
business to boost revenues and profitability
Revenues of NIIT Tech have grown at a CAGR of 23% from FY11-FY14 led by
growth across all its verticals in various geographies. However, FY15 saw a
paltry growth of 4% due to de-growth in its US BFSI segment led by a slowdown
in two of its clients.
At the end of FY2011, developed markets (US and Europe) accounted for 63%
of the overall revenue (the US and Europe markets had an almost equal share).
However, with the US geography offering better margins, gradually the revenue
mix tilted in favour of the US business with its revenue share increasing from
31% in FY11 to 44% in FY15. Further, reduction of the domestic business has
led to the share of the international business growing from 76% in FY11 to 87%
in FY15.
Revenues to grow at a 2 year CAGR of 12%
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September, 2015
Post 2008, to de-risk itself from the global melt down NIIT Tech had increased
its exposure to domestic business (primarily government sector). In FY11,
revenues from Indian operations accounted for 24% of the revenue pie, with ~
1/3rd of it coming from the government business. However, marred by delays in
project completion, high DSOs and low margin Purchase for Resale segment
(~2/3rds of Government business) stretched the balance sheet and marred
profitability.
NIIT Tech as part of its strategy consciously focused on de growing the India
business and focusing more on the international opportunity. Going forward, we
expect overall revenues to grow at a 2 year CAGR of 12% to `2,996 crores led
by expansion in international markets and strategic de-growth in its domestic
operations. By FY17, the share of overall revenues from the international
markets is expected to rise by 400 bps to 91% driven by:
International business expected to grow at a 2 year CAGR of 14% and account for 91% of FY17 revenues
31
37 38 42 44 47 48
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Post scaling down of India operations DSO days and margins set to improve
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DSO
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EBITDA %
Margins have bottomed
out in 2015.

rd
September, 2015
 Boost to the Travel and Transportation vertical
 Accentuation of revenues from BFSI
 Expansion of business in its IMS service line
 Conscious de-growth in government business
 Boost to the Travel and Transportation Vertical:
NIIT Tech strengthened its position in the Travel & Transportation (T&T)
segment with the acquisition of Softech GMBH in FY09. Later it consolidated its
position by another successful acquisition of Proyecta, Spain in FY12.
Revenues from T&T vertical grew at a robust 43% CAGR from FY11-FY13 to
`809 crore backed by large marquee client wins in the international markets. In
FY14 however the segment experienced slow growth on account of a weak
environment in Europe and slowdown of a large account in the US.
Travel and Transportation (T&T) segment currently forms the highest share of
revenues at 40% and among Indian peers it is the second leading player. Going
ahead, we expect revenues from T&T to grow at a 2 year CAGR of 12% to
`1,195 crores by FY17 on the back of:
 10 new client wins in FY15 (with another in the process of finalizing by
Q2FY16).
 Further almost half of revenues from this vertical come from international
airlines. Some consolidations of other airlines with the clients of NIIT
Tech like International Airlines Group could present NIIT Tech an
opportunity to add more business in this space..
T&T Revenues estimated to grow at a 2 yr CAGR of 12% to `1,195 Crs
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` Crores

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September, 2015
 Accentuation of revenues from BFSI vertical:
The BFSI segment accounts for 33% of the revenue share with more than a half
being contributed by the insurance vertical (17%). Within the insurance sub-
segment majority (2/3 rd) of the business is from the US geography (wherein it
facilitates implementation of third party software) with the rest being contributed
by UK (where it operates through its subsidiary NITL formed after acquisition of
Room Solutions).
Although during the period FY11-FY14, the BFSI segment grew at a robust
CAGR of 15%, FY15 witnessed a de-growth in revenues on account of a
slowdown in business from two of its BFSI clients in the US.
We expect the BFSI segment to resume its growth trajectory and scale
revenues to `1,058 crores by FY17 (2 year CAGR of 17%) on account of:
i) Launch of its new product - Advantage+ Suite which:
 Aids in policy administration, exposure management and analytics,
 Single platform for all insurance functions,
 Driving underwriting productivity and profitability for clients.
ii) Foray into the fast growing digital space through acquisition of Incessant
Technologies:
Incessant Technologies, a Hyderabad based company, is engaged in
business process management and IT consulting with focus mainly on the
BFS vertical. NIIT Tech acquired a 51% stake in this company May, 2015.
BFSI Revenues estimated to grow at a 2 yr CAGR of 17% to `1,058 Crs
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` Crores
Degrowth 0.1%

rd
September, 2015
The major benefits of this merger being:
 Incessant provides digital services (mainly digital integration) majorly in
the BFS business in UK and APAC regions which enables NIIT Tech to
expand its footprint in those geographies.
 It is a relatively new company (~4 yrs old) with a consistent 20% top line
growth to $17 mn in FY15 (which is expected to scale up to $ 24.5 mn
by FY17) and operates at significantly high margins (~25%).
 Opens doors to extensive cross-selling opportunities as Incessant is
scarcely present in the US, and also it brings in 15 new client
relationships.
iii) Acquisition of 5 new BFSI accounts (excluding Incessant) one of which
is a Top 10 Insurance company in the US.
 Expansion of business in its IMS service line:
The Infrastructure Management Services business currently contributes ~17%
to the overall revenues. While the business has a steady state in nature, it
provides the company with non linear growth opportunities through cross selling
of services without incurring a corresponding growth in costs. The IMS business
was a star performing segment growing at a healthy 43% despite overall the
company experiencing a marked slowdown. Moving forward, we expect the
revenues of its IMS business to grow at a CAGR of 28% to `694 crores by FY17
mainly from the manufacturing vertical wherein the company has acquired a
new client.
Incessant’s revenues are expected to grow at a 2 yr CAGR of 20%
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$ Mn

rd
September, 2015
 Conscious de-growth of the government business in India:
During the period FY12-14, NIIT Tech’s India business grew robustly from `189
crores to `308 crores (27% CAGR) driven by business procured from
government sponsored projects. Government business formed approximately
50% of the Indian geography. However, marred by delays in project completion,
high DSOs and wafer thin margins of the Purchase for Resale segment (~2/3rds
of Government business), it decided to scale down its operations in the
government vertical considerably.
In FY15 revenues from this segment de-grew by 36% to ` 118 crores. Over the
forecast period FY15-17, we expect the revenues from government to further
decline to `44 crores (2% of the overall revenues).
IMS expected to grow at a 2 year CAGR of 28%, while Manufacturing is expected to grow at 30% CAGR
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Government Revenues expected to stand at `44 crores by FY17
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rd
September, 2015
 Stable operations in other verticals:
NIIT Tech’s other verticals include Media, Distribution and GIS Technology. All
of which have healthy clients with a sustainable and stable order inflow.
Its media operations comprise of a JV which was signed with Morris
Communications, Georgia for a deal worth $85 Mn over a period of 5 years in
FY12, wherein NIIT Tech provides integrated IT and BPO services to Morris
Communications. After the period of initial agreement, the business foreseen
from the JV stands at ~$20 Mn per year.
In its services to the manufacturing and distribution vertical, it provides IMS
services to Holcim and for Toyota, its engagement includes setting up
dealership management systems, an association which has lasted for 15 years.
For the GIS business, NIIT Tech has set up a subsidiary in which Esri Inc, USA
has a minority stake of 11%. The subsidiary is a sole distributor of ESRI’s GIS
platform in India and it accounts for ~4% of its overall revenues.
Looking forward to gradual business growth in its other verticals, we expect the
revenues from other verticals to stand at `379 crores by FY17 (2 year CAGR of
3%.)
Revenues from other verticals are estimated to remain flattish
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rd
September, 2015
 Operating Initiatives to drive efficiency and improve employee metrics:
NIIT has recently undertaken new initiatives as a part of its strategy to improve
operational efficiency, which includes
1) Identifying Must have Accounts and Growing Top Accounts:
Certain must have accounts have been identified while also growing its top
accounts with sticky deals wherein there are miniscule chances of clients
changing their IT partners. This in turn boosts revenue sustainability and
stability.
2) Reinforcement and Changes in Front End Leadership:
Significant changes in leadership in key areas clearly spells out that NIIT Tech
is aggressively chasing growth and augurs well for the company.
3) New Sales Incentive Policy:
The company has designed a new incentive policy for improving efficiency of its
business heads. As per the new policy, the calculation of incentives will be
largely based on incremental business that is garnered from the same client
along with business from new MHAs. This can lead to creation of large
sustainable client accounts with continuous order inflow.
We expect the above initiatives to sustainably increase its Revenues/Billed
Employee while simultaneously lowering the employee cost.
Positions for which New Business Heads Appointed
Leadership Positions Sales and Marketing Positions New Position
Europe Head US BFS Head Digital Head
Global Marketing Head US Insurance head
NITL Head Sales Head - Europe and US (T&T)
Service Design Head Marketing Heads - Europe, US, APAC

rd
September, 2015
 Thrust on Digital Services augurs well for future growth
According to McKinsey, Digital services which are estimated to constitute 9% of
overall industry IT spend in CY2013 is expected to jump to 36% of the overall
spend by CY2018. NIIT Tech’s Digital Services span across all service lines
and contributed to 14% of the overall revenues in Q4FY15.
NIIT Tech has identified four functional areas for implementing its digital
services strategy viz
i. Digital experience
ii. cloud
iii. analytics, and
iv. digital integration.
Within these functional segments it has identified focus areas to build service
offering around.
Operating Efficiencies to Sustainably Improve Employee Metrics
2500000
2800000
3100000
3400000
3700000
4000000
2012 2013 2014 2015 2016E 2017E
Revenue/Billed Employee (`)
54.0
54.5
55.0
55.5
56.0
56.5
57.0
2012 2013 2014 2015 2016E 2017E
Employee Cost/Sales %
Digital Strategy to Bolster Growth across all Verticals
Digital Experience Cloud Analytics Digital Integration
Multi-Channel SFDC Digital Foresight
Mobility Azure Business Intelligence
Digital Marketing Infra as a Service Exact + Acumen (NITL)
BA.com Leading Adviser Network Fortune 500 Insurer Large APAC Pipeline
Carey SCCC Bankers Financial Leading Air Transport Provider
Accelerators for Wealth
Management Advisors
Risk Aggregation for
Underwriters
AWS GTMPartnership Digital Foresight
Focus Areas
Marquee Examples
BPM
Middleware
IncessantService Offerings
Digital Commerce
Connected Passenger

rd
September, 2015
The acquisition of Incessant will help bolster its service offerings in the digital
integration space which was sorely missing.
 Key Risks
1) Slowdown in global IT Spend:
According to Gartner, global IT Spend is expected to decline in 2015 by 5.5%
to $ 3,507 Bn driven by the strengthening dollar, albeit in constant currency
terms spending is expected to rise by 2.7%. However going forward, the
spending is estimated to increase at a 2 year CAGR of 2.6% to $ 3,692 Bn.
Increase in IT spending in constant currency terms holds the key. Any negative
movement in the IT budgets globally would be a downside risk.
2) Weakening of US $:
With NIIT’s growth story being mainly US geography dominant, USD/INR
remains a key factor to its revenue growth story. A weakening dollar would
mean low rupee convertibility, negatively affecting its revenues.
Global IT spending to grow at a 2 year CAGR of 2.6% to $ 3,692 Bn
3000
3100
3200
3300
3400
3500
3600
3700
3800
CY2012 CY2013 CY2014 CY2015E CY2016E CY2017E
CY2012 CY2013 CY2014 CY2015E CY2016E CY2017E
$ Bn
Source: Gartner, Statista, Ventura Research

rd
September, 2015
3) Slowdown in world economy:
IMF in its World Economic Outlook, July 2015 has estimated the US and Euro
Zone economies to improve marginally while it expects Middle East and Asian
economies to maintain plateaud growth.
NIIT’s growth story depends on its International business whose share is
estimated to rise to 91% in FY17 from 87% in FY15. US and EMEA’s share is
estimated to rise to 84% in FY17 from 79% in FY15. Hence, any effect of
slowdown or downside in economies where NIIT Tech operates could have a
crippling effect on revenues.
Global GDP trend remains a key monitorable
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US Euro Area UK MEA (RHS) India (RHS)
%%
Source: IMF, Ventura Research

rd
September, 2015
 Financial Performance
In Q1FY16, NIIT Tech reported a 9% Y-o-Y increase in revenues to `641.1
crores. On a Q-o-Q basis, revenues were up by 5%, mainly due to the
acquisition of Incessant. Ex-Incessant revenues were up by 1.5%. BFSI
revenues were up by 15%, while transportation recorded a growth of 1.5%. On
the other hand, manufacturing and government businesses were down by 15%
and 14% respectively. EBITDA grew 4.5% Y-o-Y to 104.2 crores in Q1FY16;
EBITDA margin remained flat Y-o-Y at 16.3%. Incessant had a positive impact
on margins and its acquisition has been EPS accretive.
Key takeaways from financial performance of FY15
The company had provided for some of its receivables and claims to the extent
of `49 crores from its government business in FY15 which is expected to reduce
gradually. Also an exceptional item to the tune `80 crores had to be expensed
out by the company on account of settlement of a dispute with one of its clients,
These have dragged its operating and PAT margins in FY15.
Quarterly Performance (` Crores)
Particulars Q1FY16 Q1FY15 FY15 FY14
Net Sales 641.1 611.2 2372.5 2305.0
Growth % 9.0 2.9
Total Expenditure 536.9 511.5 2036.6 1950.8
EBITDA 104.2 99.7 335.9 354.2
Margin % 16.3 16.3 14.2 15.4
Depreciation 27.6 24.2 91.6 61.9
EBIT (Excl. OI) 76.6 75.5 244.2 292.3
Other Income 7.9 -6.6 17.3 30.2
EBIT 84.5 68.9 261.5 322.5
Margin % 13.2 11.3 11.0 14.0
Finance Costs 1.6 0.9 5.7 4.2
Exceptional Item 0.0 80.0 -80.0 0.0
PBT 82.9 -12.0 175.9 318.4
Margin % 12.9 -2.0 7.4 13.8
Tax Expense 21.9 4.7 54.0 80.2
PAT 61.0 -16.7 121.9 238.2
Margin % 9.5 -2.7 5.1 10.3

rd
September, 2015
 Financial Outlook
Over FY15-FY17 we expect the company to clock a 12.3% CAGR in revenues
to `2,996 crores led by growth in its international revenue through its various
business verticals. On a constant currency basis, revenues are expected to
grow by 6.5% and 8% respectively for FY16 and FY17.
This is expected lead to a 2 year CAGR growth of 27% and 58% in its EBITDA
and PAT respectively. We expect the EBITDA and PAT margins to bounce back
to 18.3% (+410 bps) and 9.5% (+470 bps) by FY17.
Revenues expected to grow at a 2 year CAGR of 12.3% to `2,996 crores
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September, 2015
Improving profitability is expected to improve its RoCE and RoE which had taken
a dip in FY15 due to a muted growth in revenues along with provisions and write
offs. We expect RoCE to and RoE to stand at 35.1% and 17.8% respectively by
FY17 from 26.2% and 8.5% respectively in FY15.
EBITDA and PAT to grow at a 2 year CAGR of 27% and 58% by FY17 on the back of improving margins
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rd
September, 2015
 Valuation
We initiate coverage on NIIT Tech as a BUY with a Target Price of `644
representing a potential upside of 47% on the CMP of `440 over a period of 18
months. Our target price implies a multiple of 14x over its FY17E EPS.
Peer Comparison
Y/E March
Sales
(` Crs.)
EBITDA
(` Crs.)
PAT
(` Crs.)
EBITDA
Margin (%)
PAT
Margin (%)
ROE (%) P/E (x) P/BV (x)
EV/
EBITDA (x)
NIIT Tech
2014 2305.0 354.2 230.5 15.4 10.0 19.1 11.8 2.1 7.1
2015 2372.5 335.9 114.1 14.2 4.8 8.5 24.0 2.0 7.4
2016E 2659.4 438.9 203.2 16.5 7.6 14.3 13.5 1.8 5.8
2017E 2996.0 539.8 281.0 18.0 9.4 17.7 9.7 1.6 4.2
Comparable IT Players
Mindtree
2014 3031.6 610.2 451.0 20.1 14.9 30.5 22.0 7.2 16.9
2015 3546.1 720.0 532.2 20.3 15.0 28.1 21.2 5.4 15.3
2016E 4354.3 808.0 587.1 18.6 13.5 24.6 19.7 4.5 13.5
2017E 4962.2 969.4 675.1 19.5 13.6 23.6 17.1 3.7 11.3
Zensar Technologies
2014 2335.0 388.4 237.5 16.6 10.2 25.1 16.2 4.1 9.4
2015 2627.7 391.8 264.6 14.9 10.1 22.5 13.4 3.0 9.6
2016E 2998.3 486.7 327.8 16.2 10.9 22.7 11.0 2.6 7.7
2017E 3410.3 530.1 376.0 15.5 11.0 21.1 9.6 2.2 7.1
Top IT Players
TCS
2014 81809.2 25115.4 19325.4 30.7 23.6 34.5 27.3 9.4 18.5
2015 46954.5 10460.9 8652.8 22.3 18.4 22.9 16.7 3.6 12.0
2016E 51286.5 11265.1 9191.1 22.0 17.9 20.9 15.5 3.1 11.0
2017E 56562.3 12492.3 10173.0 22.1 18.0 20.3 14.0 2.7 9.5
Infosys
2014 50133.0 13636.2 10648.0 27.2 21.2 22.9 24.3 5.6 16.2
2015 53319.0 14901.0 12329.0 27.9 23.1 24.7 20.2 4.7 14.6
2016E 60252.3 16641.1 13262.1 27.6 22.0 23.3 19.0 4.3 13.3
2017E 68100.7 19143.0 15197.8 28.1 22.3 24.2 16.6 3.8 11.4
Wipro
2014 43754.9 10046.0 7840.5 23.0 17.9 20.9 18.1 4.1 12.4
2015 1682.1 167.7 133.7 10.0 7.9 28.0 12.5 3.4 11.4
2016E 1887.0 189.0 150.0 10.0 7.9 32.2 9.7 2.9 10.5
2017E 1919.0 221.0 173.0 11.5 9.0 31.8 8.4 2.5 9.1
Source: Ventura Research

rd
September, 2015
P/E
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CMP 5X 8X 11X 14X 17X
`
EV/EBITDA
0
500
1000
1500
2000
2500
3000
3500
4000
EV 2X 4X 6X 8X 10X
` Crores
P/BV
0
100
200
300
400
500
600
700
800
CMP 0.5X 1.25X 2X 2.75X 3.5X
`

rd
September, 2015
Financials and Projections
Y/E March, Fig in ` Cr FY 2014 FY 2015 FY 2016e FY 2017e Y/E March, Fig in ` Cr FY 2014 FY 2015 FY 2016e FY 2017e
Profit & Loss Statement Per Share Data (`)
Net Sales 2305.0 2372.5 2659.4 2996.0 EPS 38.0 18.7 33.3 46.0
% Chg. 14.0 2.9 12.1 12.7 Cash EPS 26.6 48.4 37.5 58.7
Total Expenditure 1950.8 2036.6 2220.5 2456.3 DPS 9.02 9.51 10.17 10.88
% Chg. 15.5 4.4 9.0 10.6 Book Value 218 222 244 277
EBITDA 354.2 335.9 438.9 539.8 Capital, Liquidity, Returns Ratio
EBITDA Margin % 15.4 14.2 16.5 18.0 Debt / Equity (x) 0.0 0.0 0.0 0.0
Other Income 30.2 17.3 16.0 15.7 Current Ratio (x) 2.7 2.1 2.4 2.8
Exceptional items 0.0 -80.0 0.0 0.0 ROE (%) 19.1 8.5 14.3 17.7
PBDIT 384.4 273.2 455.0 555.5 ROCE (%) 31.7 26.2 31.9 34.9
Depreciation 61.9 91.6 130.4 123.0 Dividend Yield (%) 2.0 2.2 2.3 2.5
Finance Costs 4.2 5.7 5.3 5.2 Valuation Ratio (x)
PBT 318.4 175.9 319.3 427.3 P/E 11.6 23.5 13.2 9.6
Tax Provisions 80.2 54.0 105.4 134.6 P/BV 2.0 2.0 1.8 1.6
Reported PAT 238.2 121.9 213.9 292.7 EV/Sales 1.1 1.0 0.9 0.7
Minority Interest -7.6 -7.9 -10.7 -11.7 EV/EBIDTA 6.9 7.2 5.6 4.1
PAT 230.5 114.1 203.2 281.0 Efficiency Ratios
PAT Margin (%) 10.0 4.8 7.6 9.4 Inventory Days 0.0 0.0 0.0 0.0
Employee Costs/Sales % 56.1 56.5 55.7 55.1 Debtors Days 89.4 93.2 85.0 80.0
Tax rate (%) 25.2 30.7 33.0 31.5 Creditors Days 63.3 83.5 76.7 69.4
Balance Sheet Cash Flow Statement
Share Capital 63.4 64.0 64.1 64.1 Profit Before Tax 318.38 175.91 319.28 427.34
Reserves & Surplus 1260.5 1293.3 1423.9 1627.2 Depreciation & Amortisation 61.9 91.6 130.4 123.0
Minority Interest 18.90 18.87 29.56 41.27 Working Capital Changes -116.0 125.9 -85.6 -33.9
Other Long Term Liabilities 31.0 33.9 37.0 41.3 Direct Taxes Paid & Others -102.5 -98.0 -135.1 -158.0
Total Loans 5.3 4.9 4.5 4.3 Operating Cash Flow 161.7 295.5 229 358
Total Liabilities 1379.0 1414.9 1559.1 1778.1 Capital Expenditure -149.7 -174.5 -208.2 -69.1
Gross Block 750.8 933.6 1229.6 1294.6 Other Income Received 30.2 17.3 16.0 15.7
Less: Acc. Depreciation 297.5 375.7 506.1 629.1 Others 8 -20 -10 23
Net Block 453.4 557.9 723.5 665.6 Cash Flow from Investing -111.2 -177 -203 -31
Capital Work in Progress 128.6 120.3 32.5 36.6 Inc/(Dec) in Loan Fund -0.3 -0.5 -0.7 -0.4
Long Terms Loans and Advances 24.3 44.3 44.8 36.7 Interest Paid and Others -61.9 -70.2 -78.3 -77.8
Net Current Assets 719.2 623.3 711.1 1000.0 Cash Flow from Financing -62.2 -70.8 -79.1 -78.2
Deferred Tax Assets 22.3 38.6 18.8 12.3 Net Change in Cash -11.7 48.0 -52.7 249.7
Other Non-Current Assets 31.2 30.5 28.5 27.0 Opening Cash Balance 232.9 221.2 269.2 216.5
Total Assets 1379.0 1414.9 1559.1 1778.1 Closing Cash Balance 221.2 269.2 216.5 466.2

rd
September, 2015
Disclosures and Disclaimer
Ventura Securities Limited (VSL) is a SEBI registered intermediary offering broking, depository and portfolio management services to clients. VSL is member of
BSE, NSE and MCX-SX. VSL is a depository participant of NSDL. VSL states that no disciplinary action whatsoever has been taken by SEBI against it in last
five years except administrative warning issued in connection with technical and venial lapses observed while inspection of books of accounts and records.
Ventura Commodities Limited, Ventura Guaranty Limited, Ventura Insurance Brokers Limited and Ventura Allied Services Private Limited are associates of
VSL. Research Analyst (RA) involved in the preparation of this research report and VSL disclose that neither RA nor VSL nor its associates (i) have any
financial interest in the company which is the subject matter of this research report (ii) holds ownership of one percent or more in the securities of subject
company (iii) have any material conflict of interest at the time of publication of this research report (iv) have received any compensation from the subject
company in the past twelve months (v) have managed or co-managed public offering of securities for the subject company in past twelve months (vi) have
received any compensation for investment banking merchant banking or brokerage services from the subject company in the past twelve months (vii) have
received any compensation for product or services from the subject company in the past twelve months (viii) have received any compensation or other benefits
from the subject company or third party in connection with the research report. RA involved in the preparation of this research report discloses that he / she
has not served as an officer, director or employee of the subject company. RA involved in the preparation of this research report and VSL discloses that they
have not been engaged in the market making activity for the subject company. Our sales people, dealers, traders and other professionals may provide oral or
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to buy, purchase or subscribe to any securities, and neither this document nor anything contained herein shall form the basis of or be relied upon in connection
with any contract or commitment whatsoever. This document does not solicit any action based on the material contained herein. It is for the general information
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does not have regard to the specific investment objectives, financial situation/circumstances and the particular needs of any specific person who may receive
this document. The securities discussed in this report may not be suitable for all investors. The appropriateness of a particular investment or strategy will
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conducting his/her/their own investigation and analysis of the information contained or referred to in this document and of evaluating the merits and risks
involved in the securities forming the subject matter of this document. The projections and forecasts described in this report were based upon a number of
estimates and assumptions and are inherently subject to significant uncertainties and contingencies. Projections and forecasts are necessarily speculative in
nature, and it can be expected that one or more of the estimates on which the projections and forecasts were based will not materialize or will vary significantly
from actual results, and such variances will likely increase over time. All projections and forecasts described in this report have been prepared solely by the
authors of this report independently of the Company. These projections and forecasts were not prepared with a view toward compliance with published
guidelines or generally accepted accounting principles. No independent accountants have expressed an opinion or any other form of assurance on these
projections or forecasts. You should not regard the inclusion of the projections and forecasts described herein as a representation or warranty by VSL, its
associates, the authors of this report or any other person that these projections or forecasts or their underlying assumptions will be achieved. For these
reasons, you should only consider the projections and forecasts described in this report after carefully evaluating all of the information in this report, including
the assumptions underlying such projections and forecasts. The price and value of the investments referred to in this document/material and the income from
them may go down as well as up, and investors may realize losses on any investments. Past performance is not a guide for future performance. Future returns
are not guaranteed and a loss of original capital may occur. Actual results may differ materially from those set forth in projections. Forward-looking statements
are not predictions and may be subject to change without notice. We do not provide tax advice to our clients, and all investors are strongly advised to consult
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Ventura Securities Limited
Corporate Office: C-112/116, Bldg No. 1, Kailash Industrial Complex, Park Site, Vikhroli (W), Mumbai – 400079

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