Super 7 Picks - January 2016

amit.paprika

RR0201201688E62

Super 7 Picks - January 2016


B P W E A L T H

Techno Funda Report - January 2016

Index

Company Recommendation Price (Rs) Entry Range (Rs) Target Price (Rs) Stop Loss (Rs) Page No.

Aditya Birla Nuvo Ltd Buy 2169 2140-2100 2360 2000 1

Bharat Forge Ltd Buy 888 880-860 970 820 2

Grasim Industries Ltd Buy 3768 CMP 4100 3600 3

Havells India Ltd Buy 321 321-310 355 298 4

IndusInd Bank Ltd Buy 964 955-945 1030 910 5

Power Finance Corporation Ltd Buy 203 CMP 235 190 6

UPL Ltd Buy 440 440-430 500 405 7

2nd January, 2016

Research Team

research@bpwealth.com

022-61596409

BP Equities Private Limited (www.bpwealth.com)


Techno Funda Report - January 2016

B P W E A L T H

Performance Tracker

15%

10%

5%

0%

-5%

-10%

7.41%

3.8%

3.1%

3.1% 2.4%

2.9%

1.8% 2.0%

1.4% 2.0% 2.3%

0.4% 0.7%

0.1%

-0.4% 0.0%

-0.4%

-1.9%

-0.6%

-0.9%

-1.9%

-1.5%

-6.5%

-6.1%

Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15

Nifty Return

Techno Funda Return

Performance Tracker August 2015

Sr. No. Company Recommendation Reco Price (Rs) Target Price (Rs) Status

1 Ambuja Cements Ltd Buy 232 270 Stop Loss Triggered

2 Bharat Forge Ltd Buy 1,148 1,290 Target Achieved

3 Biocon Ltd Buy 457 515 Profit Booked at 481

4 Mahindra & Mahindra Ltd Buy 1,363 1,530 Profit booked at 1423

5 Mindtree Ltd Buy 1,280 1,450 Target Achieved

6 State Bank of India Buy 270 295 Profit booked at 285

7 Wipro Ltd Buy 570 630 Stop Loss Triggered

Techno Funda Return For Aug, 2015 : 2.93% , Nifty Return For Aug, 2015 : -6.1%

Performance Tracker September 2015

Sr. No. Company Recommendation Reco Price (Rs) Target Price (Rs) Status

1 Century Textiles & industries Ltd Sell 590-610 465 Not Initiated

2 Hexaware Technologies Ltd Buy 237-225 285 Profit Booked at 251

3 Idea Cellular Ltd Buy 154 180 Stop Loss Triggered

4 ITC Ltd Buy 320-310 365 Exit at 323

5 Oil India Ltd Buy 468 545 Exit at 432

6 Ultratech Cement Ltd Buy 2947 3250 Stoploss Triggered

7 Union Bank of India Sell 185 150 Profit Booked at 170

Techno Funda Return For Sept, 2015 : -0.9% , Nifty Return For Sept, 2015 : -1.9%

BP Equities Private Limited (www.bpwealth.com)


Techno Funda Report - January 2016

B P W E A L T H

Performance Tracker October 2015

Sr. No. Company Recommendation Reco Price (Rs) Target Price (Rs) Status

1 Asian Paints Ltd Buy 840-820 920 Profit Booked at 882

2 Axis Bank Ltd Buy 485-475 550 Profit Booked at 522

3 Bharti Airtel Ltd Buy 340-330 385 Profit Booked at 365

4 Castrol India Ltd Buy CMP 500 Exit at 463

5 Eicher Motors Ltd Buy CMP 20550 Exit at 17742

6 Glenmark Pharmaceuticals Ltd Buy CMP 1160 Stoploss Triggered

7 Tata Consultancy Services Ltd Buy CMP 2840 Profit Booked at 2770

Techno Funda Return For Oct, 2015 : 2.0% , Nifty Return For Oct, 2015 : 1.4%

Performance Tracker November 2015

Sr. No. Company Recommendation Reco Price (Rs) Target Price (Rs) Status

1 ACC Ltd Buy 1380-1360 1540 Exit at 1353

2 Apollo Tyres Ltd Sell 178-183 150 Not Initiated

3 Castrol India Ltd Buy 463 520 Stoploss Triggered

4 Hero MotoCorp Ltd Buy 2560-2520 2840 Profit Booked at 2693

5 JSW Steel Ltd Buy 910-890 1045 Exit at 872

6 Siemens Ltd Sell 1327 1110 Profit Booked at 1249

7 Wipro Ltd Buy 573-560 630 Exit at 570

Techno Funda Return For Nov, 2015 : 0.1% , Nifty Return For Nov, 2015 : -1.5%

Performance Tracker December 2015

Sr. No. Company Recommendation Reco Price (Rs) Target Price (Rs) Status

1 Bharti Infratel Ltd Buy 396-385 450 Profit Booked at 434

2 Hindustan Unilever Ltd Buy 815 900 Profit Booked at 857

3 Info Edge (India) Ltd Buy 830-810 940 Profit Booked at 895

4 JSW Steel Ltd Buy 971-950 1120 Profit Booked at 1027

5 LIC Housing Finance Ltd Sell 465-475 405 Stoploss Triggered

6 Tata Motors Ltd Buy 380-370 445 Profit Booked at 402

7 Zee Entertainment Enterprises Ltd Sell 396-405 350 Stoploss Triggered

Techno Funda Return For Dec, 2015 : 3.1% , Nifty Return For Dec, 2015 : 2.3%

BP Equities Private Limited (www.bpwealth.com)


2nd Feb ,

Aditya Birla Nuvo Ltd

Diversified

Buy

B P

W E A L T H

Technical View (Weekly Chart)

Descending Triangle Breakout

Execution Data

Target (Rs) 2360

Stop loss (Rs) 2000

Buying Range (Rs) 2140-2100

Last Close Price (Rs) 2169

% change Weekly 6.33

Support at 50% retracement

RSI Surpassed Downsloping Trendline

Weekly Oscillator Direction

13 WMA Upwards

21 WMA Upwards

50 WMA Upwards

RSI

Buy Mode

MACD

Sideways Mode

Source: Falcon, BP Equities Research

Technical View

The stock was moving in a descending triangle for the past few months and now has surpassed the

upper trendline resistance indicating a breakout which is a bullish signal for the medium trend. The

recent trough is placed around 50% retracement of its upmove from 1516 to 2345 which suggests

this trough to act as strong support for short term trend. RSI has surpassed the resistance from a

downsloping trendline which suggests a bullish reversal and compliments the bullish view of price.

We recommend to BUY ABIRLANUVO in the range of 2140-2100 with a stop loss of 2000 for the

target of 2360 in short term.

Investment Rationale

NBFC business to grow at healthy pace

The company’s NBFC business continues to nurture its plans to grow the loan book size (the book

continues to grow at a healthy pace of 45% YoY, and now stands at Rs197.4bn). It has forayed into

the housing finance business and has started lending, and for the quarter its loan book stood at

Rs8.8bn (+94% on a Q-o-Q basis). On the life insurance vertical, the company has gained market

share and expects steady growth momentum.

Stake sell in BSLI to Sun life to help debt reduction

ABNL has entered into an agreement with the Canadian insurance major Sun Life to sell approximately

437mn equity shares constituting 23% of the issued and paid up equity share capital of BSLI

(Birla Sun Life Insurance). Proceeds from the stake sale in BSLI will reduce the net debt of ABNL

substantially. Coupled with the free cash flow generation from divisions, the standalone balance

sheet of ABNL will stand strengthened to support its growth plans. On completion of the transaction,

Sun Life's stake in BSLI will increase from current 26% to 49% while ABNL will continue to hold the

controlling stake at 51%. The 23% stake sale will fetch ABNL Rs 16.6bn, valuing BSLI at Rs 72.3 bn.

The transaction is expected to be completed by the end of the fiscal year ending March 2016.

Outlook

ABNL’s strong positioning in each of its business verticals (life insurance, telecom, lifestyle and asset

management) and its effort towards taking necessary restructuring steps to unlock value for minority

shareholders either through disinvestment of sub-scale businesses (carbon black and BPO), demerger

of growth business and/or consolidation within the group is likely to enhance the shareholders’

value in this quality conglomerate business.

Sector Outlook Positive

Stock

BSE code 500303

NSE Symbol

ABIRLANUVO

Bloomberg

ABNL IN

Reuters

ABRL.BO

Key Data

Nifty 7,963

52WeekH/L(Rs) 2,345 / 1,516

O/s Shares (Rs mn) 130

Market Cap (Rs bn) 278

Face Value (Rs) 10

Average volume

3 months 1,39,567

6 months 1,89,968

1 year 1,94,818

2


2nd Feb ,

Bharat Forge Ltd

Industrial Products

Buy

B P

W E A L T H

Technical View (Weekly Chart)

Intermediate Trendline Surpassed

Execution Data

Target (Rs) 970

Stop loss (Rs) 820

Buying Range (Rs) 880-860

Last Close Price (Rs) 888

% change Weekly 3.19

Weekly Oscillator Direction

13 WMA Upwards

21 WMA Downwards

50 WMA Downwards

Reversed after taking Support from Downsloping Trendline

RSI

MACD

Buy Mode

Buy Mode

RSI Surpassed Downsloping Trendline

Source: Falcon, BP Equities Research

Technical View

The stock has reversed after taking support from the down sloping trend line. Price has consolidated

around the lower trend line for past couple of months and has recently surpassed the intermediate

trend line which is a bullish signal for short term trend. RSI has surpassed a down sloping trendline

which suggests a bullish reversal and compliments the bullish view of price. We recommend to BUY

BHARATFORG in the range of 880-860 with a stop loss of 820 for the target of 970 in short term.

Investment Rationale

Domestic economy, new orders from international markets are key for Industrial segment

The company supplies its forged products to Oil & Gas companies, construction & mining sectors,

etc. Bharat Forge has diversified its presence more in industrial segment and expects significant

scope of improvement in sub-segments like defense, aerospace, etc. With expected revival in domestic

economy, Government’s thrust & initiatives like ‘Make in India’ and new orders win, we expect

Industrial segment to perform well. The company has signed a multi year contract with Boeing to supply

pre-machined titanium forging

Auto business provides a strong sign of recovery

Bharat Forge is an established player having presence in domestic and international Commercial

vehicle OEMs for supplying Chassis and power train parts. In recent past, domestic CV industry has

shown uptick in volume and the demand outlook for North American CV companies is also positive.

Moreover, European CV market is showing gradual improvement therefore we expect company’s

standalone Auto business to show strong recovery going forward.

Outlook

The company has reduced its dependence on cyclical commercial vehicle segment and also diversified

its clientele. We expect strong volume growth in Auto segment on the back of revival in domestic

and North American commercial vehicle industries as well as in Industrial segment based on expectation

of higher growth in domestic economy, Make In India initiative and new order win. The profitability

of the company is significantly influenced by capacity utilization and we expect it to improve with

higher volume.

Sector Outlook

Neutral

Stock

BSE code 500493

NSE Symbol

BHARATFORG

Bloomberg

BHFC IN

Reuters

BFRG.BO

Key Data

Nifty 7,963

52WeekH/L(Rs) 1,363/733

O/s Shares (Rs mn) 233

Market Cap (Rs bn) 207

Face Value (Rs) 2

Average volume

3 months 1,050,060

6 months 1,036,927

1 year 1,099,496

3


2nd Feb ,

Grasim Industries Ltd

Textiles

Buy

B P

W E A L T H

Technical View (Weekly Chart)

Execution Data

Target (Rs) 4100

Stop Loss (Rs) 3600

Buying Range (Rs)

CMP

Last Close Price (Rs) 3768

% change Weekly 1.32

Weekly Oscillator Direction

Breakout from Symmetrical Triangle

13 WMA Upwards

21 WMA Upwards

50 WMA Upwards

RSI Surpassed Downsloping Trendline

RSI

MACD

Buy Mode

Buy Mode

Source: Falcon, BP Equities Research

Technical View

The stock was moving in a symmetrical triangle for the past several months and is consolidating

around the upper trendline for the past few weeks. Recently the stock has closed above the upper

trendline which is a bullish signal and suggests the short term trend to turn bullish. RSI has surpassed

downsloping trendline which suggests a bullish reversal and compliments the bullish view of

price. We recommend to BUY GRASIM at CMP with a stop loss of 3600 for the target of 4100 in

short term.

Investment Rationale

Performance to improve on the back improved VSF pricing, delivery from Vilayat Plant

We expect Grasim’s performance to improve significantly going forward based on a number of positive

triggers and updates. We expect delivery of VSF from the newly commissioned Vilayat plant (at

100% capacity utilization in Q2FY16) to drive volumes while improved realizations due to plant shut

downs in China (up 3.6% q-o-q at ~Rs.125/kg) to enhance margins visibility. Our view on margin sustainability

is further solidified with our expectation of input and pulp costs (which declined during the

previous quarter) remaining at current levels. Additionally, since majority of the capex is over, we

expect the company to enjoy higher and stronger cash flows going ahead. Approval of the merger

with Aditya Birla Chemicals India Ltd. by the Competition Commission of India should also provide

scale to the already performing chemical segment of the holding company.

Expect UltraTech Cement’s performance to improve on the back of domestic demand

Indian cement industry is the 2nd largest market after China, accounting for about 8% of the total

global production. 67% of the cement demand is by the housing sector and other major consumers

include infrastructure (13%), commercial (11%) and industrial construction (9%). The per capita consumption

of cement in India still remains substantially low at about 192 kg when compared with the

world average which stands at about 365 kg (excluding China). This underlines the tremendous

scope for growth in the Indian cement industry in the long term. Cement industry is closely linked to

the economic growth and given the government’s thrust in the housing and infrastructure segment,

the cement demand is likely to pick up. H1FY16 has seen tremendous traction in the domestic roads

segment with several projects being commissioned and several pending projects being completed.

We expect traction in the domestic roads sector to drive demand for cement as well. Ultratech, being

the largest domestic cement producer, will be the first to exploit this surge in demand.

Sector Outlook

Positive

Stock

BSE code 500300

NSE Symbol

GRASIM

Bloomberg

GRASIM IN

Reuters

GRAS.BO

Key Data

Nifty 7,963

52WeekH/L(Rs) 4,025/3,301

O/s Shares (Rs mn) 92

Market Cap (Rs bn) 347

Face Value (Rs) 10

Average volume

3 months 46,511

6 months 55,965

1 year 66,998

4


2nd Feb ,

Havells India Ltd

Electrical Equipment

Buy

B P

W E A L T H

Technical View (Weekly Chart)

Execution Data

Breakout from Downsloping Channel

Target (Rs) 355

Stop Loss (Rs) 298

Buying Range (Rs) 321-310

Last Close Price (Rs) 321

% Change Weekly 5.18

Consolidation Before Breakout

Weekly Oscillator Direction

13 WMA Upwards

21 WMA Upwards

50 WMA Upwards

RSI has surpassed Downsloping Trendline

RSI

MACD

Buy mode

Buy mode

Source: Falcon, BP Equities Research

Technical View

The stock was moving in a downsloping channel for the past couple of months and has recently given

breakout from the channel which is a bullish signal for medium term trend. The breakout has come

after price has consolidated around the upper trendline for past few weeks which increases the reliability

of the breakout. RSI has surpassed the downsloping trendline which is a bullish signal and compliments

the bullish view of price. We recommend to BUY HAVELLS in the range of 321-310 with a

stop loss of 298 for the target of 355 in short term.

Investment Rationale

Stake sale in Sylvania and corporate restructuring value accretive

Sylvania was a huge drag on Havells as not only was the company making losses for the last 3 financial

years but also draining out Havell’s resources consistently (investment in Sylvania increased

from Rs. 1.6 Bn in FY08 to Rs. 9.8 Bn in FY15. The consistent increase in investment in Sylvania

brought down the ROE from 47% in FY07 to 21% in FY15. The stake sale should serve to release

capital and deploy it towards projects with better prospects. Apart from the stake sale, the management

has guided that it will aggressively restructure operations at loss making subsidiaries which

have been retained by scaling down operations at Chile and in the US and reducing losses at units in

Brazil and Thailand. We believe that the management is in the right direction as the restructuring

process is highly value accretive and should remove the overhang on the stock’s performance.

Management to concentrate on developing regional appliance franchise

We expect that the management and financial resources which were being drained by Sylvania will

now be deployed more efficiently in developing the company’s regional appliance franchise. We expect

the company to strengthen the domestic appliance franchise by either strengthening the distribution

network or adopting the inorganic growth route. The management also plans to withdraw/

streamline extra discounts to distributors which is strong trigger for revenue growth going ahead.

Change in industry dynamics to be market share accretive for Havells

We believe that competition has intensified significantly with several players popping up in the consumer

appliances space. However, we believe that the industry is headed for a consolidation through

exits from various product categories and rationalizations. This development is value accretive for

Havells’ market share, given it’s product mix and resources at hand.

Sector Outlook

Neutral

Stock

BSE code 517354

NSE Symbol

HAVELLS

Bloomberg

HAVL IN

Reuters

HAVEL.BO

Key Data

Nifty 7,963

52 Week H/L (Rs) 322/235

O/s Shares (Rs mn) 625

Market Cap (Rs bn) 201

Face Value (Rs) 1

Average volume

3 months 2,046,685

6 months 1,431,716

1 year 1,613,102

5


2nd Feb ,

IndusInd Bank Ltd

BFSI

Buy

B P

W E A L T H

Technical View ( Weekly Chart)

Execution Data

Target (Rs) 1030

Stop loss (Rs) 910

Buying Range (Rs) 955-945

Last Close Price (Rs) 1.95

% change Weekly 964

Weekly Oscillator Direction

Intermediate Trend line Surpassed

within an Up sloping Channel

13 WMA Upwards

21 WMA Upwards

50 WMA Upwards

RSI

Buy Mode

MACD

Buy Mode

RSI has surpassed Downsloping Trendline

Source: Falcon, BP Equities Research

Technical View

The stock is moving in a parallel upsloping channel for the past few months, recently the stock has

surpassed an intermediate trendline which suggests the short term trend to turn bullish. RSI is placed

around the downsloping trendline which is drawn connecting its previous peaks, a break above this

trendline will further accelerate the upmove. We recommend to BUY INDUSINDBK in the range of

955-945 with a stop loss of 910 for the target of 1030 in short term.

Investment Rationale

Loan growth remains strong

IIB has grown at healthy rate of 27% CAGR in credit over FY11-FY15. IIB’s loan book grew by 31%

YoY (corporates +36%, retail +23%) in Q2FY16. In Jul’15, the bank took over RBS’ Rs 4.1bn diamond

& jewellery financing business. Even adjusting for this bought-out portfolio, loan growth was

strong at 24% YoY. Commercial vehicle loans grew by 28% YoY/8% QoQ, which is impressive and

suggests signs of a revival in the CV segment. Going forward, Management stands confident to

maintain the 25% credit growth momentum mainly on the back of gradual improvement in CV cycle,

surge in non-vehicle retail loans (SME, LAP, gems and jewellery portfolio) and uptick in new corporate

loan portfolio.

Asset quality stable

IIB has maintained its asset quality better than its peers. For the last qurter GNPA and NNPA were

largely stable. Slippages from the corporate segment increased to Rs 730mn as a new account

turned NPA while two accounts slipped from the restructured book. Net sale of NPA to ARC stood at

Rs 210mn during the quarter. Credit cost stood at 15bps in Q2 vs. 12bps in Q1FY16 – management

is confident of keeping costs below its full-year guidance of 60bps.

Superior traction in non-interest income

Non-interest income grew 32%, driven by a healthy fee income growth of 24% and doubling of treasury

gains to Rs1.1bn. Loan processing fees and distribution fees showed better traction with a growth

of 61% and 41%, respectively. Trade and remittance fees, investment banking income, exchange

income and general banking fees grew 37%, 23%, 22% and 1%, respectively.

Sector Outlook

Neutral

Stock

BSE code 532187

NSE Symbol

INDUSINDBK

Bloomberg

IIB IN

Reuters

INBK.BO

Key Data

Nifty 7,963

52 Week H/L (Rs) 989 / 784

O/s Shares (Rs mn) 594

Market Cap (Rs bn) 571

Face Value (Rs) 10

Average volume

3 months 11,15,000

6 months 11,48,920

1 year 11,10,580

1


2nd Feb ,

Power Finance Corporation Ltd

Buy

B P

W E A L T H

Finance

Technical View (Weekly Chart)

Execution Data

Target (Rs) 235

Parallel Trendlines

Stop Loss (Rs) 190

Buying Range (Rs)

CMP

Last Close Price (Rs) 203

% change Weekly (1.12)

Weekly Oscillator Direction

13 WMA Downwards

Support at 61.80% retracement

21 WMA Downwards

50 WMA Downwards

Bullish crossover in Stochastics Oscillator

RSI

MACD

Sideways Mode

Sideways Mode

Source: Falcon, BP Equities Research

Technical View

The stock had earlier reversed after taking support at lower trendline which is drawn parallel to the

upper trendline. The level of 185 also coincides with 61.80% retracement of its upmove from 97 to

345 which suggests this trough to act as a strong support for medium term trend. Recently price has

reversed after forming bullish engulfing a bullish reversal candlestick pattern near 78.60% retracement

which suggests the short term trend to turn bullish. Stochastic oscillator has given a bullish

crossover which is a bullish signal and compliments the bullish view of price. We recommend to BUY

PFC at CMP with a stop loss of 190 for the target of 235 in short term.

Investment Rationale

Centre's Ujwal Discom Assurance Yojana (UDAY) is a big positive for the revival of state electricity

boards (SEBs).

The success depends on timely tariff revision without political constraints, power purchase by SEBs

on competitive principles and consistency by SEBs in lowering aggregate technical and commercial

(AT&C) losses. Improving health of SEBs is positive for PFC as it has substantial exposure to it, although

there would be some pressure on margins when loans are converted to state bonds.

Attractive dividend yield

At current market price the stock is trading at attractive dividend yield of 4.5%. Given the case where

government is short of its disinvestment target for FY16, we can expect good dividends from PSU

companies and PFC being one of them.

Sector Outlook

Positive

Stock

BSE code 532810

NSE Symbol

PFC

Bloomberg

POWF IN

Reuters

PWFC.BO

Key Data

Nifty 7,963

52WeekH/L(Rs) 314 / 185

O/s Shares (Rs mn) 1320

Market Cap (Rs bn) 267

Face Value (Rs) 10

Average volume

3 months 21,38,450

6 months 20,55,000

1 year 20,70,000

Outlook

Demand to remain strong in power sector. PFC is one of the key players for the financing of power

projects. Owing to huge demandsupply gap in power sector the government is focusing on the development

of more power projects which in turn would boost the business of PFC. PFC is one of the

leading power sector public financial institutions and provides fund as well as non fund based finances

for entire gamut of power related activities. PFC is also nodal agency for ultra-mega power project

(UMPP) programme.

6


2nd Feb ,

UPL Ltd

Buy

B P

W E A L T H

Chemicals

Technical View (Weekly Chart)

Execution Data

Target (Rs) 500

Stop loss (Rs) 405

Buying Range (Rs) 440-430

Last Close Price (Rs) 440

% change Weekly 1.69

Weekly Oscillator Direction

Bullish Engulfing Candlestick

13 WMA Downwards

21 WMA Downwards

Positive Reversal in RSI

50 WMA Downwards

RSI

Buy Mode

MACD

Sideways Mode

Bullish crossover

Source: Falcon, BP Equities Research

Technical View

The stock has reversed after taking support around the previous trough, also at the recent trough the

stock has formed bullish engulfing pattern a bullish reversal candlestick pattern which suggests this

recent trough to act as strong support for medium term trend. RSI has formed positive reversal which

is a bullish signal and compliments the bullish view of price. Stochastic oscillator has given a bullish

crossover which is a bullish signal and compliments the bullish view of price. We recommend to BUY

UPL in the range of 440-430 with a stop loss of 405 for the target of 500 in short term.

Investment Rationale

Advanta merger to give access to new geographies, led by incremental cross selling opportunities

UPL-Advanta merger paves the way for a simpler structure as cross holding of promoter group and

UPL in Advanta gets eliminated. Promoter holding in merged entity will reduce by 2% (29.8% premerger).

It will be easier for the merged entity to market Advanta’s seeds in 40 countries where UPL

has direct presence (6 countries for Advanta) by leveraging UPL’s distribution and customer access.

Business to be easy under merged entity as issues like transfer pricing, tax duplications, marketing

efforts, etc are overcome. On the call, management indicated Advanta’s FY17 PAT to be Rs 3.3 bn

(includes Rs 0.9 bn of annual merger synergies) and EPS to be accretive to UPL shareholders.

Maintains guidance for FY16 at 12-15% revenue growth

The management has maintained its guidance for FY16 at revenue growth of 12-15% ( constant currency)

driven by volumes and pricing growth. The company expect EBITDA margins to improve 60-

100bp, driven by improvement in gross margin. We expect realization of integration benefits from

DVA Agro to be fully realized over next 3-4 quarters which would drive margin improvement and profit

growth.

Outlook

UPL by virtue of its wide geographic spread and the ability to launch generic molecules across the

world will be expectedly able to maintain high return ratios even going forward. This is expected to

improve as and when the present forays into US Mid-West and distribution network build up in Brazil

start bearing fruits.

Sector Outlook

Neutral

Stock

BSE code 512070

NSE Symbol

UPL

Bloomberg

UPLL IN

Reuters

UNPO.BO

Key Data

Nifty 7,963

52WeekH/L(Rs) 576 / 315

O/s Shares (Rs mn) 429

Market Cap (Rs bn) 188

Face Value (Rs) 2

Average volume

3 months 15,46,605

6 months 17,59,920

1 year 21,44,625

7


B P W E A L T H

Research Desk Tel: +91 22 61596406

Institutional Sales Desk Tel: +91 22 61596403/04/05

Disclaimer Appendix

Analyst (s) holding in the Stock : Nil

Analyst (s) Certification:

We analysts and the authors of this report, hereby certify that all of the views expressed in this research report accurately reflect our personal

views about any and all of the subject issuer (s) or securities. We also certify that no part of our compensation was, is, or will be

directly or indirectly related to the specific recommendation (s) or view (s) in this report. Analysts aren't registered as research analysts by

FINRA and might not be an associated person of the BP Equities Pvt. Ltd. (Institutional Equities).

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would subject to BP WEALTH Management Pvt. Ltd. or any of its affiliates to any registration or licensing requirement within such jurisdiction.

Corporate Office:

4th floor,

Rustom Bldg,

29, Veer Nariman Road, Fort,

Mumbai-400001

Phone- +91 22 6159 6464

Fax-+91 22 6159 6160

Website- www.bpwealth.com

Registered Office:

24/26, 1st Floor, Cama Building,

Dalal street, Fort,

Mumbai-400001

BP Wealth Management Pvt. Ltd.

CIN No: U67190MH2005PTC154591

BP Equities Pvt. Ltd.

CIN No: U67120MH1997PTC107392

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