Union Budget 2016-17

Spotlight on fiscal prudence

Sometimes,nobadnewscanbeconsideredasgoodnews.Withnoneofthefearednegativesmakingitin
theUnionBudget(noincreaseintimeframeforlongtermcapitalgainsorsuperrichtaxorhikeinbasic
excise), it remained more of a neutral event in our view. We term it as neutral because in his second
Budget presentation as FM, Jaitley had ample time to deliver a dream Budget one that would have
simplified taxation, guided on GST, reduced corporate tax by 1% as promised and cut on nonPlan
expenditure. However, hardly any relief was given on direct tax (in fact there were some rollbacks for
corporates), possibly due to only 6.6% revenue growth, which was half of the budgeted growth. Plan
expenditurespendroseonly2%whereasnonPlanexpendituregrewby7.8%andtheFMproposeddoing
awaywiththebifurcationwhichisactuallyagoodindicatorforthegovernmenttoevaluateitsspending
onbothfrontssooneseeslittlegainindoingawaywithit.Evensubsidies,asapercentageofGDP,have
risen from 1.7% to 1.9%, due to higher jump in food subsidy. Perhaps, the political need of the hour
promptedmanysocialistmeasures.

Onthefaceofit,theresnothingfundamentallywrongabouttheFMsBudgetthatrestsonnotone,not
two but nine pillars viz agriculture, rural populace, social welfare including healthcare, education, skill
development & employment creation, infrastructure, financial reforms, fiscal prudence, tax reforms and
easeofdoingbusiness.

Several measures, announced in disparate areas, promise positive yield in the medium to long term.
Farmers and budding entrepreneurs have handsome takeaways, so does the bottomend of the salaried
class, which are all great news. The rural and farm sector allocations including MGNREGA, irrigation,
electrification, crop insurance,interest subvention and cooking gas subsidies are laudable asthey would
makeadifferencetocountlessBPLfamiliesacrossthelengthandbreadthofthecountry.Commitmentto
no retrospective taxation and measures pertaining to FDI, voluntary disclosure of black money, national
ruraldigitalliteracymissionwereamongtheotherpositives.

Thesilverlining,however,wasthatthefiscaldeficittargetof3.9%wasmetandtargetof3.5%hasbeen
maintainedforFY17.ThisraisesexpectationsofaratecutfromtheRBI.Thetwootherbigpositivesare
the Rs2 lac crore capital expenditure on roads and railways and continued flow of funds and autonomy
fromCentretoState(Shareofstatesat35%v/s27%in201415).

WhilemanysawthelackofadequaterecapitalizationofPSUbanksasanegative,theotherwayoflooking
at it is, not wanting to throw more good money after bad. The government can always provide support
wheneverneeded;infactPSUconsolidationorstrategicsalesasmentionedwouldbesmartmoves.

Fortheyearahead,theFMstaxrevenuetargetslargelylookachievable.Tomeethistargetof3.5%fiscal
deficit, Mr. Jaitleys banking on collecting ~Rs30,000 crore from the amnesty scheme possibly, Rs98,000
crorefromcommunicationservicesand25%riseinnontaxrevenues.Withabudgetedgrowthof15%for
Planexpenditureandalowergrowthof9%fornonPlanexpenditure,hereshopingforadreamBudget
nextyear.

AmarAmbani,HeadofResearch

February29,2016

research@indiainfoline.com
ThisreportispublishedbyIIFLIndiaPrivateClientsresearchdesk.IIFLhasotherbusinessunitswithindependentresearchteamsseparatedby'Chinesewalls'cateringtodifferent
setsofcustomershavingvaryingobjectives,riskprofiles,investmenthorizon,etc.Theviewsandopinionsexpressedinthisdocumentmayattimesbecontraryintermsofrating,
EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.
targetprices,estimatesandviewsonsectorsandmarkets(Readthecompletedisclaimeratthebackofthisreport)
Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Union Budget 2016-17

Budget at a Glance
Rscrore

20142015A

20152016BE

20152016RE

20162017BE

1,101,472

1,141,575

1,206,084

1,377,022

2.TaxRevenue(nettoCentre)

903,615

919,842

947,508

1,054,101

3.NontaxRevenue

197,857

221,733

258,576

322,921

4.CapitalReceipts$

562,201

635,902

579,307

601,038

5.RecoveriesofLoans

13,738

10,753

18,905

10,634

6.OtherReceipts

37,737

69,500

25,312

56,500

510,725

555,649

535,090

533,904

8.TotalReceipts$

1,663,673

1,777,477

1,785,391

1,978,060

9.NonplanExpenditure

1,201,029

1,312,200

1,308,194

1,428,050

10.OnRevenueAccountofwhich,

1,109,394

1,206,027

1,212,669

1,327,408

11.InterestPayments

402,444

456,145

442,620

492,670

12.OnCapitalAccount

91,635

106,173

95,525

100,642

13.PlanExpenditure

462,644

465,277

477,197

550,010

14.OnRevenueAccount

357,597

330,020

335,004

403,628

15.OnCapitalAccount

105,047

135,257

142,193

146,382

16.TotalExpenditure

1,663,673

1,777,477

1,785,391

1,978,060

17.RevenueExpenditure

1,466,992

1,536,047

1,547,673

1,731,037

18.Grantsforcreationofcapitalassets

130,760

132,472

132,004

166,840

19.CapitalExpenditure

196,681

241,430

237,718

247,023

20.RevenueDeficit

365,519

394,472

341,589

354,015

(2.9)

(2.8)

(2.5)

(2.3)

234,759

268,000

209,585

187,175

(1.9)

(2.0)

(1.5)

(1.2)

510,725

555,649

535,090

533,904

(4.1)

(3.9)

(3.9)

(3.5)

108,281

99,504

92,469

41,234

(0.9)

(0.7)

(0.7)

(0.3)

1.RevenueReceipts

7.BorrowingsandotherLiabilities*

%ofGDP
21.EffectiveRevenueDeficit
%ofGDP
22.FiscalDeficit
%ofGDP
23.PrimaryDeficit(2011)
%ofGDP
*IncludesdrawdownofCashBalance.
$ExcludingreceiptsunderMarketStablisationScheme

Page2of9

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Union Budget 2016-17

Sectoral impact
AutomobilesNegative
Keyannouncement
InfrastructureCessbeingleviedonmotorvehicles

Impact
Demandtobehitaspriceswillberaisedtooffsetthesame.
Negativeforthesector

1)Petrol/LPG/CNGdrivenmotorvehiclesoflengthnot
NegativeforMaruti,TataMotors
exceeding4mandenginecapacitynotexceeding1200cc1%
2)Dieseldrivenmotorvehiclesoflengthnotexceeding4m
andenginecapacitynotexceeding1500cc2.5%

NegativeforMaruti,TataMotors

3)OtherhigherenginecapacityandSUVsandbiggersedans
4%

NegativeforM&M,Maruti,TataMotors,ForceMotors

Abolitionofpermitrajforpublictransport

PositiveforAshokLeyland,TataMotors,BajajAuto,TVS
Motors,AtulAuto

ReducedbenefitofR&Ddeductionfrom200%to150%till
2020andfurtherlowerto100%from2020

Negativeforthesector

Taxatsourceof1%onpurchaseofluxurycarsexceeding
valueofRs10lakhs

NegativeforM&M,Maruti,TataMotors,ForceMotors

IncreaseinallocationtowardsMGNREGAandotherrural
developmentschemes

PositiveforM&M,Escorts,HeroMotocorpandMaruti

Timelimitof31March2016removedforNilcustomsduty
and6%excisedutyonpartsofelectricvehicles

PositiveforM&M

BFSI/ExchangesPositive
KeyAnnouncement
RetentionofFiscalDeficittargetof3.5%forFY17

Impact
Positiveforthesectoringeneralasthiswouldkeep
government'smarketborrowingsincheckandencourageRBI
toeaserates

NoincreaseinFY17recapitalisationcommittmentofRs.
25,000crforPSUBanks

NegativeforPSUBanks;moresoforsmallerbankshaving
veryweakcapitalposition

BankBoardBureautobeoperationalizedduringFY17anda
roadmapforconsolidationofPSUBankstobespeltout

PositiveforPSUBanks;especiallyforthesmallerPSBsasthey
couldbemergedwithrelativelystrongerlargePSB

DebtRecoveryTribunalswillbestrengthenedforspeedier
resolutionofstressedassets

Positiveforthesector,especiallyforPSUBanks

Governmenttotakeforwardtheprocessoftransformationof PositivesignalingimpactforbeleagueredPSUBanks
IDBIBankandwouldalsoconsidertheoptionofreducingits
staketobelow50%.
NBFCstobeeligiblefordeductiontotheextentof5%of
incomeinrespectofprovisionforbadanddoubtfuldebts

PositiveforallNBFCs;wouldbeearningsaccretive

Multiplemeasuresandincentivesannouncedtospur
developmentofaffordablehousing

PositiveforHousingFinanceCossuchasDHFL,LICHF,Repco,
CanFin,etc

Forfirsthomebuyers,additionalinterestdeductionofRs
PositiveforHousingFinanceCosingeneral
50,000perannumforloansuptoRs.35lakhsanctioned
duringthenextfinancialyearprovidedthevalueofthehouse
doesnotexceedRs50lakh.
CredittargetunderPradhanMantriMudraYojana(scheme
launchedtobenefitsmall/microentrepreneurs)increased
significantlytoRs.180,000crforFY17

PositiveforBanks,NBFCsandMFIshavingexposuretoMicro
&SmallEnterpriselending

Page3of9

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Union Budget 2016-17

Allocationsmateriallyraisedtovariousschemesfocusedon
farm,ruralandsocialsectors

PositiveforNBFCshavinghigherexposuretorurallending
suchasMahindraFinance,Magma,SCUF,etc

Anumberofmeasureswillbeundertakentofacilitate
deepeningofcorporatebondmarket

PositiveforNBFCs;couldhelpinreducingcostoffundsinthe
longerterm

EnablingthesponsorofanARCtoholdupto100%stakeinit
andpermitnoninstitutionalinvestorstoinvestin
securitizationreceipts

PositivefortheBankingsectorasawholeasARCscanplaya
largerroleintacklingstressedassetsinthesystem

100%FDIpermittedinARCsthroughautomaticroute.FPIs
allowedtoinvestupto100%ofeachtrancheinsecurities
receiptsissuedbyARCssubjecttosectoralcaps

CouldincreasethenumberofARCsinthecountrywhichcan
helpbanksinoffloadingstress

Foreigninvestmentupto49%allowedinInsurancesectorvia
theautomaticroute

PositiveforRelianceCapital,MaxIndia,BajajFinserve,ICICI
Bank,KotakBank,HDFCLtd.,CholamandalamInvt,etc

NewderivativeproductstobedevelopedbySEBIinthe
CommodityDerivativesmarket

PositiveforMCX

CementNeutral
KeyAnnouncement
Increaseinruralandurbanhousingspending
Doublingofcleanenergycessoncoal
Increaseinroadandrailspending
ExtensionofexcisedutyexemptionforRMCunit
Nohikeinrailfreight
Possibilityofsharpincreaseinexcisedutyofdieselandpetrol

Impact
Positiveforsector
Negativeforsector
Positiveforsector
PositiveforlargeRMCplayerslikeACC
Positiveforsector
Negativeforsector

FMCG&ConsumerDiscretionaryPositive
KeyAnnouncement
Excisedutiesonvarioustobaccoproductsotherthanbeedi
raisedbyabout10%to15%.

Impact
NegativeforITC,VSTIndustries,GodfreyPhilips

ExciseonreadymadegarmentswithretailpriceofRs1,000or
moreraisedto2%withoutinputtaxcreditor12.5%with
inputtaxcredit.

NegativeforArvind,MaduraGarments,Raymond.

Rs9,000crhasbeenprovidedforSwachhBharatAbhiyan.

Positive:CeraSanitaryware,HSIL

Cutsexcisedutyonrubbersheetsforsolesto6%v/s12.5%.

Positive:BATA,RelaxoFootwear,LibertyShoes

Forthefirsthomebuyers,deductionforadditional
interestofRs50,000perannumforloansuptoRs35lakh
sanctionedduringthenextfinancialyear,providedthevalue
ofthehousedoesnotexceedRs50lakh.

MarginallyPositive:Greenply,Centuryply,Kajaria

Excisedutyof1%onJewellerywithoutinputcredittaxor
12.5%withinputtaxcredit.

NegativeforallJewellerycompanies

HigherDisposableIncome
Raisetheceilingoftaxrebateundersection87Afrom
Rs2000toRs5000tolessentaxburdenonindividualswith
incomeuptoRs5laks.
Benefitundersection80GGlimitextendedfromRs24,000
toRs60,000paforpeoplenothavingtheirownhousenor
receivinganyHRA.

Positivefortheoverallindustry

IncreaseinoutlaytoRuralschemesandsocialinfrastructure
(Rs15,000crinterestsubventiontofarmersandRs38,500cr
allocationtoMNREGA).

Positivefortheoverallindustry

SlightlypositiveforVMart

Page4of9

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Union Budget 2016-17

KrishiKalyanCess,@0.5%.

NegativeforCompanies

InfrastructurePositive
KeyAnnouncement
Targettoaward10,000kmofNationalHighwaysinFY17.
Also50,000kmofStateHighwaystobeupgradedasNational
Highways

Impact
PositivefortheentireRoadsector

TotaloutlayforroadsandhighwaysincreasedtoRs.97,000cr

Willleadtoincreasedinvestmentsinroadprojects.Positive
forallcompaniesintheRoadsector

RevitalizationofPPPthroughPublicUilityBillfordispute
resolution,developmentofnewCreditRatingSystemand
guidelinesforrenegotiationofPPPAgreements

PositiveforBOTPlayerslikeIRBInfra,SadbhavInfra,Ashoka
Buildcon,PNCInfra

Servicetax@5.6%tobeleviedoncontractsenteredonor
after1stMarch2016forconstructionofmonorailandmetro

NegativeforITD,JkumarInfra,RelianceInfra

Redevelopmentofunservedandunderservedairports;to
develop10of25nonfunctionalairstripsaroundthecountry

PositiveforcompanieslikeGMRInfra

Rs.800crallocatedformodernizingportsandincreasingtheir
efficiency.Thefundstoalsobeusedindevelopingnew
greenfieldportsbothintheeasternandwesterncoasts

PositiveforcompanieslikeAdaniPorts,ITDCementation,
SimplexInfra

CreationofadedicatedLongTermIrrigationFundinNABARD
withaninitialcorpusofaboutRs.20,000cr.

PositiveforcompanieslikePratibhaIndustries,JainIrrigation,
ITDCementation

Withdrawalof80IAbenefitunderITActfordevelopmentand
O&Monorafter1stApril,2017.Howeverinvestmentlinked
deductionundersection35ADofITActtobeallowed.

Negativeforselectedplayersavailing80IAbenefitlikeKNR
Constructions

Impositionofcountervailingdutyonselectedmachineryused Negativeforroaddevelopmentcompanies
inconstructionofroads
Customdutiesexemptionondirectimportsofspecified
goodsfordefencewithdrawn

InlinewithGovernment'sfocusofMakeinIndia.Willbenefit
companieslikeBEL,LT,BharatForge

Customdutiesoncertaincapitalgoodsproductsincreased
from7.5%to10%

PositivefordomesticcapitalgoodscompanieslikeCrompton
Greaves,BHEL,LT,Thermax

TotaloutlayforInfrastructuresectorpeggedatRs.221,246cr
forFY17(FY16:~Rs.180,000cr)

PositivefortheentireInfrasector

IT/EducationPositive
KeyAnnouncement
SunsetdateextendedbythreeyearstoMarch2020for
Section10AAwhichrelatestocommencementofactivityby
aunitlocatedinaSEZ

Impact
Positiveforthesectorcouldmoderatetaxrateforsome
companiesforthecomingyears

1500MultiSkillTrainingInstitutestobesetupacrossthe
countrywithabudgetofRs.1,700cr

PositiveforNIITandAptech

Page5of9

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Union Budget 2016-17

Metals&MiningNeutral
KeyAnnouncement
Customsdutyforaluminiumraisedby2.5%
Customsdutyforzincalloysraisedby2.5%

Impact
PositiveforaluminiumproducerslikeHindalco,NALCOand
Vedanta
PositiveforzincproducerslikeHZLandVedanta

Exportdutyonironorelumps&finesbelow58%Fecontent
toNIL
CleanenergycessoncoalincreasedfromRs.200/tontoRs.
400/ton
Exportdutyonbauxitereducedfrom20%to15%

PositiveforlowgradeironoreminesinGoa.Marginally
positiveforVedanta
NegativeforcompaniesconsumingdomesticcoallikeNALCO,
Vedanta,Hindalco,JSPL,JSWSteel
Noimpact

Exportdutyonchromiumoresandconcentratesreduced
from30%toNIL
Increasedoutlayininfrastructurespending

MarginalpositiveforMOIL
Wouldleadtohighermetaldemand.Positiveforallmetal
producingcompanies

Oil&GasNegative
Keyannouncement
RateofOilIndustriesDevelopmentCess,ondomestically
producedcrudeoilchangedfromRs4,500/tonto20%ad
valorem
Nodeductionshallbeavailabletoanundertakingengagedin
productionofmineraloilornaturalgasiftheproduction
commencesonorafter1stApril,2017
Aproposalisunderconsiderationfornewdiscoveriesand
areaswhichareyettocommenceproduction,first,to
providecalibratedmarketingfreedom;andsecond,todoso
atapredeterminedceilingpricetobediscoveredonthe
principleoflandedpriceofalternativefuels

Impact
Lowerthanexpectedbenefit,negativeforONGC,OilIndia
andCairnIndia
NegativeforONGC,OilIndia,RelianceIndustries,CairnIndia

Noimpacttilltheregulationsarefinalized

Againstexpecationsthegovernmentdidnotlevyanycustoms NegativeforONGCbutpositiveforHPCL,BPCLandIOC
dutyoncrudeoil
Goodsrequiredforexploration&productionofhydrocarbon PositiveforONGC,OilIndia
activitiesundertakenunderPetroleumExplorationLicenses
(PEL)orMiningLeases(ML)issuedorrenewedbefore1st
April1999

PharmaceuticalsNeutral
Keyannouncement
ReduceweightedR&Ddeductionto150%fromApril2017
and100%fromApril2020

Impact
Negativeforallpharmacompanies

10%taxrateforglobalincomeaccruedfrompatent
developedandfiledinIndia

TobenefitplayerslikeDrReddys'whichcancommercialize
patentsonglobalbasis

CustomsdutyonimportofMolybdenum99hasbeen
removed

PositiveforradiopharmaplayerslikeJubilantandPoly
Medicure

AnamountofRs.850crallocatedovernextfewyearsfor
severalanimalwellnessprograms

PositiveforanimalhealthplayerslikeSeQuentScientificand
OmkarSpeciality

HealthcoverofRs.1lakhforBPLfamilieswithadditional
Rs.30,000coverforseniorcitizens

PositiveforhealthcareproviderslikeApolloasitexpands
coveragemarket

Page6of9

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Union Budget 2016-17

TelecomNegative
Keyannouncement
FY17Budgetedreceiptsof~Rs.99,000cris~77%higherthan
netFY16REof~Rs.56,000cr

Impact
Weexpectrecurringand2015auctioninstallmentamounts
at~Rs.30,000crwhichleavestheshortfalltobefinanced
from2016auctionsespecially700MHzandonetime
spectrumcharges;atTRAIrecommended700MHzprice,it
wouldhugelynegativeforBhartiandIdea

UtilitiesNeutral
KeyAnnouncement
Targettoelectrify100%villagesbyMay01,2018.Rs.8,500cr
providedforDeendayalUpadhayayaGramJyotiYojnaand
IntegratedPowerDevelopmentSchemes.

Impact
Wouldleadtohigherpowerdemand.Positiveforallpower
generationcompanies

Withdrawalof80IAbenefitunderITActfordevelopmentand Negativeforcompaniesavailing80IAbenefit
O&Monorafter1stApril,2017.Howeverinvestmentlinked
deductionundersection35ADofITActtobeallowed.
Customdutiesoncertaincapitalgoodsproductsincreased
from7.5%to10%

Negativeforpowergenerationcompaniesasthismayleadto
increaseincosts

CleanenergycessoncoalincreasedfromRs.200/tontoRs.
400/ton

Negativeforpowergenerationcompanies

Page7of9

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.

Best Broker of the Year by Zee Business for contribution to broking

NirmalJain,Chairman,IIFL,receivedtheawardforTheBestBrokeroftheYear(forcontributiontobrokinginIndia)atIndia'sBestMarket
AnalystAwards2014organisedbytheZeeBusinessinMumbai.TheawardwaspresentedbytheguestofHonourAmitShah,presidentof
theBharatiyaJanataPartyandPiyushGoel,Ministerofstatewithindependentchargeforpower,coalnewandrenewableenergy.

Recommendationparametersforfundamentalreports:

BuyAbsolutereturnofover+15%
AccumulateAbsolutereturnbetween0%to+15%
ReduceAbsolutereturnbetween0%to10%
SellAbsolutereturnbelow10%

CallFailureIncaseofaBuyreport,ifthestockfalls20%belowtherecommendedpriceonaclosingbasis,unlessotherwise
specified by the analyst; or, in case of a Sell report, if the stock rises 20% above the recommended price on a closing basis,
unlessotherwisespecifiedbytheanalyst

IndiaInfolineGroup(hereinafterreferredasIIFL)isengagedindiversifiedfinancialservicesbusinessincludingequitybroking,DPservices,merchant
banking,portfoliomanagementservices,distributionofMutualFund,insuranceproductsandotherinvestmentproductsandalsoloansandfinance
business.IndiaInfolineLtd(hereinafterreferredasIIL)isapartoftheIIFLandisamemberoftheNationalStockExchangeofIndiaLimited(NSE)
andtheBSELimited(BSE).IILisalsoaDepositoryParticipantregisteredwithNSDL&CDSL,aSEBIregisteredmerchantbankerandaSEBIregistered
portfoliomanager.IILisalargebrokinghousecateringtoretail,HNIandinstitutionalclients.Itoperatesthroughitsbranchesandauthorisedpersons
and subbrokers spread across the country and the clients are provided online trading through internet and offline trading through branches and
CustomerCare.

Terms&ConditionsandOtherDisclosures:

a) Thisresearchreport(Report)isforthepersonalinformationoftheauthorisedrecipient(s)andisnotforpublicdistributionandshouldnotbe
reproduced orredistributedto any other person or in any formwithout IILs priorpermission. The information providedinthe Report is from
publiclyavailabledata,whichwebelieve,arereliable.WhilereasonableendeavorshavebeenmadetopresentreliabledataintheReportsofar
asitrelatestocurrentandhistoricalinformation,butIILdoesnotguaranteetheaccuracyorcompletenessofthedataintheReport.Accordingly,
IILoranyofitsconnectedpersonsincludingitsdirectorsorsubsidiariesorassociatesoremployeesshallnotbeinanywayresponsibleforanyloss
or damage that may arise to any person from any inadvertent error in the information contained, views and opinions expressed in this
publication.
b)

Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or
implied,ismaderegardingfutureperformance.Information,opinionsandestimatescontainedinthisreportreflectajudgmentofitsoriginaldate
ofpublicationbyIIFLandaresubjecttochangewithoutnotice.Theprice,valueofandincomefromanyofthesecuritiesorfinancialinstruments
mentionedinthisreportcanfallaswellasrise.Thevalueofsecuritiesandfinancialinstrumentsissubjecttoexchangeratefluctuationthatmay
haveapositiveoradverseeffectonthepriceorincomeofsuchsecuritiesorfinancialinstruments.

c)

The Report also includes analysisand views of our research team.The Report ispurely forinformationpurposes and does not construe tobe
investmentrecommendation/adviceoranofferorsolicitationofanoffertobuy/sellanysecurities.TheopinionsexpressedintheReportareour
currentopinionsasofthedateoftheReportandmaybesubjecttochangefromtimetotimewithoutnotice.IILoranypersonsconnectedwithit
donotacceptanyliabilityarisingfromtheuseofthisdocument.

d)

InvestorsshouldnotsolelyrelyontheinformationcontainedinthisReportandmustmakeinvestmentdecisionsbasedontheirowninvestment
objectives, judgment, riskprofile and financial position. The recipients of this Report may take professional advice before acting on this
information.

e)

IILhasotherbusinesssegments/divisionswithindependentresearchteamsseparatedby'chinesewalls'cateringtodifferentsetsofcustomers
havingvaryingobjectives,riskprofiles,investmenthorizon,etcandtherefore,mayattimeshave,differentandcontraryviewsonstocks,sectors
andmarkets.

f)

Thisreportisnotdirectedorintendedfordistributionto,oruseby,anypersonorentitywhoisacitizenorresidentoforlocatedinanylocality,
state,countryorotherjurisdiction,wheresuchdistribution,publication,availabilityorusewouldbecontrarytolocallaw,regulationorwhich
wouldsubjectIILanditsaffiliatestoanyregistrationorlicensingrequirementwithinsuchjurisdiction.Thesecuritiesdescribedhereinmayormay
notbeeligibleforsaleinalljurisdictionsortocertaincategoryofinvestors.PersonsinwhosepossessionthisReportmaycomearerequiredto
informthemselvesofandtoobservesuchrestrictions.

g)

AsIILalongwithitsassociates,areengagedinvariousfinancialservicesbusinessandsomighthavefinancial,businessorotherinterestsinother
entitiesincludingthesubjectcompany/iesmentionedinthisReport.However,IILencouragesindependenceinpreparationofresearchreportand
strivestominimizeconflictinpreparationofresearchreport.IILanditsassociatesdidnotreceiveanycompensationorotherbenefitsfromthe
subject company/ies mentioned in the Report or from a third party in connection with preparation of the Report. Accordingly, IIL and its
associatesdonothaveanymaterialconflictofinterestatthetimeofpublicationofthisReport.

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.


h)

AsIILanditsassociatesareengagedinvariousfinancialservicesbusiness,itmighthave:
(a)receivedanycompensation(exceptinconnectionwiththepreparationofthisReport)fromthesubjectcompanyinthepasttwelvemonths;
(b)managedorcomanagedpublicofferingofsecuritiesforthesubjectcompanyinthepasttwelvemonths;(c)receivedanycompensationfor
investment banking or merchant banking or brokerage services from the subject company in the past twelve months; (d) received any
compensationforproductsorservicesotherthaninvestmentbankingormerchantbankingorbrokerageservicesfromthesubjectcompanyin
thepasttwelvemonths;(e)engagedinmarketmakingactivityforthesubjectcompany.

i)

IIL and its associates collectively do not own (in their proprietary position) 1% or more of the equity securities of the subject company/ies
mentionedinthereportasofthelastdayofthemonthprecedingthepublicationoftheresearchreport.

j)

TheResearchAnalyst/sengagedinpreparationofthisReportorhis/herrelative
(a)doesnothaveanyfinancialinterestsinthesubjectcompany/iesmentionedinthisreport;(b)doesnotown1%ormoreoftheequitysecurities
ofthesubjectcompanymentionedinthereportasofthelastdayofthemonthprecedingthepublicationoftheresearchreport;(c)doesnot
haveanyothermaterialconflictofinterestatthetimeofpublicationoftheresearchreport.

k)

TheResearchAnalyst/sengagedinpreparationofthisReport:
(a)hasnotreceivedanycompensationfromthesubjectcompanyinthepasttwelvemonths;(b)hasnotmanagedorcomanagedpublicoffering
of securities for the subject company in the past twelve months; (c) has not received any compensation for investment banking or merchant
banking or brokerage services from the subject company in the past twelve months; (d) has not received any compensation for products or
servicesotherthaninvestmentbankingormerchantbankingorbrokerageservicesfromthesubjectcompanyinthepasttwelvemonths;(e)has
not received any compensation or other benefits from the subject company or third party in connection with the research report; (f) has not
servedasanofficer,directororemployeeofthesubjectcompany;(g)isnotengagedinmarketmakingactivityforthesubjectcompany.

WesubmitthatnomaterialdisciplinaryactionhasbeentakenonIILbyanyregulatoryauthorityimpactingEquityResearchAnalysis.

A graph of daily closing prices of securities is available at http://www.nseindia.com/ChartApp/install/charts/mainpage.jsp, www.bseindia.com and

http://economictimes.indiatimes.com/markets/stocks/stockquotes. (Choose a company from the list on the browser and select the three years
periodinthepricechart).

Publishedin2016.IndiaInfolineLtd2016

IndiaInfolineLimited(FormerlyIndiaInfolineDistributionCompanyLimited),CINNo.:U99999MH1996PLC132983,CorporateOfficeIIFLCentre,
Kamala City, Senapati Bapat Marg, Lower Parel, Mumbai 400013 Tel: (9122) 4249 9000 .Fax: (9122) 40609049, Regd. Office IIFL House, Sun
InfotechPark,RoadNo.16V,PlotNo.B23,MIDC,ThaneIndustrialArea,WagleEstate,Thane400604Tel:(9122)25806650.Fax:(9122)25806654
Email:mail@indiainfoline.comWebsite:www.indiainfoline.com,Referwww.indiainfoline.comfordetailofAssociates.

National Stock Exchange of India Ltd. SEBI Regn. No. : INB231097537/ INF231097537/ INE231097537, Bombay Stock Exchange Ltd. SEBI Regn.
No.:INB011097533/ INF011097533/ BSECurrency, MCX Stock Exchange Ltd. SEBI Regn. No.: INB261097530/ INF261097530/ INE261097537, United
Stock Exchange Ltd. SEBI Regn. No.: INE271097532, PMS SEBI Regn. No. INP000002213, IA SEBI Regn. No. INA000000623, SEBI RA Regn.:
INH000000248.

ForResearchrelatedqueries,writeto:AmarAmbani,HeadofResearchatresearch@indiainfoline.com
ForSalesandAccountrelatedinformation,writetocustomercare:cs@indiainfoline.comorcallon912240071000

EMISPDF in-spjainmr from 61.8.139.218 on 2016-03-01 05:05:02 GMT. DownloadPDF.

Downloaded by in-spjainmr from 61.8.139.218 at 2016-03-01 05:05:02 GMT. EMIS. Unauthorized Distribution Prohibited.