Kotak Daily 01 Oct 24

India Daily
October 01, 2024 NIFTY50 [Sep 30]: 25,811
Contents
Daily Alerts
Change in Reco
National Aluminium Co.: Best placed with rising prices and deflating costs
Company Alerts
Cyient: Management perspectives on semiconductor initiatives
Sector Alerts
Quant Research: Alphabet Factor Portfolios: Unfazed by macro uncertainty, multifactor portfolios continue to
outperform
Economy Alerts
Economy: External balance remains comfortable
Economy: Increasing chances of sharper fiscal consolidation
Private Circulation Only.

This document may only be distributed to QIBs (qualified institutional buyers) as defined under rule 144A of the Securities A ct of 1933
CHANGE IN RECO.
National Aluminium Co. (NACL) ADD

Metals & Mining
CMP(₹): 210 Fair Value(₹): 235 Sector View: Cautious NIFTY-50: 25,811 October 01, 2024
Best placed with rising prices and deflating costs Company data and valuation summary
NACL is best placed to benefit from the ongoing supply tightness in the Stock data
alumina market, given its net long position and the consequent tailwind in the
CMP(Rs)/FV(Rs)/Rating 210/235/ADD
aluminum prices. Commissioning of captive coal mines has helped reduce
52-week range (Rs) (high-low) 215-89
costs in FY2024 and a further ramp-up should keep costs on a downtrend.
Mcap (bn) (Rs/US$) 386/4.6
The 1 mtpa alumina refinery expansion is progressing at a slow place and we
ADTV-3M (mn) (Rs/US$) 3,052/36.4
estimate volume contribution from 2HFY27E. We upgrade alumina/aluminum
price forecast and earnings for NACL. Our FV increases to Rs235/share (from Shareholding pattern (%)
Rs160). Upgrade to ADD (from SELL), given attractive risk-reward.
2.8
16.3
Alumina—tight market to keep prices elevated
Alumina at US$532/ton, is 45% YTD FY2026 and at 20% of aluminum versus 5.8
51.3
16% at the start of the year. The price strength reflects a spate of production 13.3
disruptions in 1HFY26, resulting in a ~0.5-0.6 mtpa market deficit in CY2024E.
10.4
Meanwhile, demand is supported by record primary aluminum output in China.
Furthermore, bauxite prices, are firming up, 10% YTD FY2026, due to Promoters FPIs MFs BFIs Retail Others
environmental restrictions in China, fuel shortages in Guinea and uncertainty
Private Circulation Only. This document may only be distributed to QIBs (qualified institutional buyers) as defined under rule 144A of the Securities A ct of 1933
around Indonesia’s export policy. We upgrade alumina price forecast by Price performance (%) 1M 3M 12M
+11%/10%/7% for FY2025/26/27E, factoring in the market tightness and expect Absolute 15 12 116
only a gradual easing of the ongoing deficit. Rel. to Nifty 13 5 85
Rel. to MSCI India 12 3 74
Aluminum—cost support amid structural tightness
Forecasts/Valuations 2025E 2026E 2027E
Aluminum prices at US$2,650/ton, 17% in the past two months, led by (1)
EPS (Rs) 19.6 18.6 20.4
improved sentiments after rate cuts in the US and China and (2) elevated costs
EPS growth (%) 120.9 (5.5) 9.7
from higher alumina prices. In the near term, we see higher production in China
P/E (X) 10.7 11.3 10.3
due to restarts in Yunnan and sluggish global demand to narrow the ongoing
deficit. However, we believe the market would remain structurally in deficit in P/B (X) 2.3 2.1 1.8
the medium term, with China production fast approaching capacity cap (45.5 EV/EBITDA (X) 6.5 6.7 5.8
mtpa) and current utilization at 95% and secular demand, led by energy RoE (%) 23.0 19.2 18.8
transition. Market would require incentive prices in the medium term beyond Div. yield (%) 3.7 3.5 3.9
the ongoing cost push to encourage expansions. We upgrade our prices by Sales (Rs bn) 162 163 178
2%/1%/4% for FY2025/26/27E, but marginally below spot. EBITDA (Rs bn) 54 52 59
Net profits (Rs bn) 36 34 37
Captive coal to ease costs further, refinery expansion seeing gradual progress
Source: Bloomberg, Company data, Kotak Institutional Equities estimates
NACL produced 2 mtpa coal from the Utkal D mine in FY2024 and additional 2
Prices in this report are based on the market close of
mtpa from the Utkal E coal block, in FY2025-26E, which should further reduce September 30, 2024
external coal requirement and costs. It expects to commission 1 mtpa alumina
refinery expansion by 2QFY26E and has completed 65% of project work,
whereas we estimate volumes only from 2HFY27E. The company has also
executed the mining lease for the Pottangi mines in 1QFY25, which would feed
the new refinery.
Upgrade earnings, FV to Rs235 (from Rs160) and rating to ADD (from SELL)
We increase EBITDA by 8%/11%/17% for FY2025E/26E/27E, mainly led by
commodity price assumptions. Our FV increases to Rs235/share on higher
earnings, roll over to September 2026E and higher multiple (7X EV/EBITDA
versus 5.5X earlier) as it enters a volume growth phase from FY2027E. We
upgrade to ADD, given the attractive risk-reward at current valuations.
Full sector coverage on KINSITE
Sumangal Nevatia Siddharth Mehrotra

3
Spot alumina prices are 21% higher versus 1QFY25 average LME aluminum prices are +17% in past two months
Exhibit 1: Alumina prices, September 2019–23 (US$/ton) Exhibit 2: Aluminum prices, September 2019–23 (US$/ton)
Australian alumina (LHS) LME aluminium (RHS)
550
2900
500
2700
450
2500
400
2300
350
2100
300
1900
250
1700
200
1500
Feb-24
Dec-23
Aug-23
Aug-24
Apr-24
Apr-23
Jun-23
Jun-24
Oct-23
May-24
Aug-23
Jan-24
Feb-24
Jun-24
Jul-24
Aug-24
Nov-23
Dec-23
Mar-24
Sep-23
Oct-23
Apr-24
Sep-24
Source: Company, Kotak Institutional Equities estimates
Alumina—supply disruptions impact market balance
Alumina prices, at US$532/ton, is +45% YTD FY2026 and at ~20-21% of aluminum versus 16% at the
start of the year. Rally in alumina prices reflects production disruptions at refineries either due to
maintenance activity or a lack of domestic bauxite, resulting in a ~0.5-0.6 mtpa market deficit in
CY2024E.
The deficit reflects curtailment at Kwinana, ongoing production issues at Gladstone and force majeure
being declared by Rio Tinto on third-party exports, apart from Nalco’s export disruption in 2QCY24 and
ongoing supply disruptions in China, amid domestic bauxite sourcing constraints.
Consequently, Rio Tinto has reduced its full-year alumina production guidance to 7.0-7.3 mn tons from
7.6-7.9 mn tons previously. Alumina production cuts in Western Australia and Queensland regions for
July 2024 have been accompanied by smelter restarts in Europe, Central and South America, which is
likely to result in a ~0.5-0.6 mn tons deficit in CY2024E.
Bauxite—tight, concentrated markets
Tight bauxite markets in China have resulted in domestic prices at elevated levels. While ~75% of total
bauxite requirements are imported, these are highly concentrated with Guinea/Australia accounting for
70%/25% of these imports.
Industry reports in China suggest that domestic bauxite reserves are currently sufficient to meet
domestic production for the next eight years, considering a worst-case scenario of no additional bauxite
resource discoveries. This indicates insufficient resource security. Bauxite supply in Shanxi remains tight
after the provincial government introduced the stricter regulations over mines in the province. This also
restricts alumina production in the region.
The ongoing ban on bauxite exports by Indonesia could increase China’s dependency on Guinea, which
itself faces a turbulent geopolitical environment. Speculation on a reversal of this ban continues, with
prices moving higher in response to incipient fears of disruption.
National Aluminium Co.

Metals & Mining India Research
k.kathirvelu-kotak.com
4
Aluminum—smelters stock up alumina to mitigate tail risk events
Domestic prices in China may continue to witness near-term strength, as market feedback suggests that
multiple China smelters need to stock alumina ahead of the national holiday in October.
Furthermore, smelter restarts in Yunnan (except for Yunnan Honghe and Yunnan Hongtai), which were
curtailed in 4QCY23, are running at full capacity. Spot cargoes continue to be booked at elevated prices
to mitigate alumina supply disruption risk.
Outside China, alumina consumption in the short term is being supported by the ramp-up of (1) Taishet
in Russia, (2) Huaqing Aluminium Morowali in Indonesia and (3) increased output in India. Europe smelter
capacity of ~0.1 mtpa is also estimated to have come back online in 1HCY24.
Alumina prices are at 20%+ of LME aluminum prices, as of September 2024

Exhibit 3: Metallurgical grade alumina as a proportion of LME aluminum prices, September 2006–24 (%)
35
Alumina as % of LME aluminum price (%)
30
25
20
15
10
0
Sep-06
Sep-07
Sep-08
Sep-09
Sep-10
Sep-11
Sep-12
Sep-13
Sep-14
Sep-15
Sep-16
Sep-17
Sep-18
Sep-19
Sep-20
Sep-21
Sep-22
Sep-23
Sep-24
We expect only gradual easing of the ongoing deficit in alumina We expect aluminum prices to remain elevated on cost tailwinds
Exhibit 4: Alumina price forecast, March fiscal year-ends, 2019- Exhibit 5: Aluminum price forecast, March fiscal year-ends,
27E (US$/ton) 2019-27E (US$/ton)
Alumina Australia FoB (US$/ton) LME aluminium price (US$/ton)
Spot Alumina prices (US$/ton) Spot Aluminum prices (US$/ton)
600 3,000
2,650
500 488 2,500 2,500 2,575
451
437
400 2,000
300 1,500
200 1,000
100 500
- -
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2019 2020 2021 2022 2023 2024 2025E2026E2027E
Source: Bloomberg, Kotak Institutional Equities estimates

Source: Bloomberg, Kotak Institutional Equities estimates

5
FCF to remain positive, despite growth capex over FY2025-27E

Exhibit 6: Capex and free cash flow, March fiscal year-ends, 2019-27E (Rs bn, %)
50 46 Capital expenditure (Rs mn) Free cash flow (Rs mn)
40 37
30
30
24
18 18
20
14
10
(11) (3)
(10)
(7) (8) (9)
(12) (13)
(20) (16)
(30) (24) (24) (24)

2019 2020 2021 2022 2023 2024 2025E 2026E 2027E
Strong earnings to help maintain 3-4% dividend yield over FY2025-27E

Exhibit 7: Cash per share, dividend yield, March fiscal year-ends, 2019-27E (Rs/share, %)
Net cash per share (LHS) Dividend Yield (%) (RHS)

25 24 4.5%
20 4.0%
20 19
19 3.5%
17
15 3.0%
15
12 2.5%
11 11
2.0%
10
1.5%
5 1.0%
0.5%
0 0.0%
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E

6
Exhibit 8: NACL, changes in estimates, March fiscal year-ends, 2025-27E (Rs mn)
Revised estimates Previous estimates Change (%)
2025E 2026E 2027E 2025E 2026E 2027E 2025E 2026E 2027E
Net sales 162,313 162,890 178,227 159,293 161,798 176,325 2 1 1
EBITDA 53,872 51,709 58,659 49,761 46,687 50,336 8 11 17
PAT 36,076 34,087 37,391 32,828 29,813 30,091 10 14 24
EPS (Rs) 19.6 18.6 20.4 17.9 16.2 16.4 10 14 24
Aluminium
LME price (US$/ton) 2,500 2,575 2,650 2,450 2,550 2,550 2 1 4
Volumes (mn tons) 0.46 0.46 0.46 0.5 0.5 0.5 - - -
EBITDA (US$/ton) 666 707 836 648 679 712 3 4 17
Alumina
Alumina price (US$/ton) 488 451 437 441 408 408 11 10 7
Volumes (mn tons) 1.29 1.29 1.58 1.4 1.4 1.7 (8) (8) (9)
EBITDA (US$/ton) 263 224 190 213 172 149 24 30 27
Re/US$ rate 83.4 84.3 85.5 83.4 84.3 85.5 - - -
Exhibit 9: NACL, key assumptions, March fiscal year-ends, 2019-27E

2019 2020 2021 2022 2023 2024 2025E 2026E 2027E
Re/US$ rate 70.1 70.9 74.2 74.5 80.7 82.8 83.4 84.3 85.5
Aluminium
LME aluminium price (US$/ton) 2,050 1,750 1,807 2,777 2,468 2,208 2,500 2,575 2,650
Sales ('000 tons) 440 377 452 457 464 470 460 460 460
Realization (US$/ton) 2,288 1,958 2,001 3,018 2,765 2,469 2,823 2,902 2,980
Costs (US$/ton) 1,980 2,016 1,771 2,076 2,270 2,049 2,157 2,194 2,145
EBITDA/ton (US$) 308 (58) 231 942 494 420 666 707 836
EBITDA (Rs mn) 9,501 (1,631) 7,232 32,066 18,498 16,349 25,547 27,416 32,879
Alumina
Alumina Australia FoB (US$/ton) 461 308 274 360 348 347 488 451 437
Production ('000 tons) 2,153 2,161 2,086 2,122 2,123 2,124 2,166 2,166 2,460
Sales ('000 tons) 1,318 1,304 1,228 1,233 1,247 1,168 1,290 1,290 1,584
Costs (US$/ton) 276 237 190 214 288 219 224 227 247
EBITDA (US$/ton) 185 71 84 146 60 128 263 224 190
EBITDA (Rs mn) 17,109 6,523 7,677 13,439 6,003 12,380 28,325 24,293 25,781
We revise Fair Value to Rs235 (earlier Rs160) based on September 2026E financials
Exhibit 10: NACL, valuation details, September 2026E (Rs/share)
Multiple EV
(Rs mn) (X) (Rs mn) Rs/share
EBITDA 55,184 7 386,291 210
Net Debt (43,177) (24)
Equity value 429,468 235
Fair Value (Rs/share) 235

7
NACL is most sensitive to changes in aluminum prices NACL is most sensitive to change in alumina prices
Exhibit 13: EBITDA and Fair Value sensitivity to 1% change in Exhibit 14: EBITDA and Fair Value sensitivity to 1% change in
aluminum prices (%) alumina prices (%)
EBITDA FV EBITDA FV
2.50% 1.4% 1.3%

1.99% 1.2% 1.1%
2.00%
1.67% 1.0%
1.61%
0.8%
1.50%
0.6%
1.04%
0.94%1.01% 0.4%
1.00%
0.1% 0.2%
0.2%
0.50% 0.0%
-0.2% -0.1%
0.00% -0.2%
-0.4%
NACL HNDL VEDL
NACL HNDL VEDL


8
Exhibit 15: NACL’s profit model, balance sheet and cash flow model, March fiscal year-ends, 2018-26E (Rs mn)
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E
Profit model (Rs mn)
Net sales 114,993 84,718 89,558 142,146 142,569 131,492 162,313 162,890 178,227
EBITDA 26,610 4,892 14,908 45,505 24,501 28,729 53,872 51,709 58,659
Other income 3,259 2,726 1,466 2,641 2,336 2,507 2,318 2,325 2,345
Interest (24) (57) (71) (231) (129) (172) (211) (211) (211)
Depreciaiton (4,761) (5,298) (6,058) (5,955) (7,158) (7,497) (7,749) (8,253) (10,804)
Profit before tax 25,083 2,262 10,245 41,960 19,550 23,567 48,230 45,571 49,988
Current tax (10,075) (880) (1,777) (10,518) (2,944) (8,397) (12,154) (11,484) (12,597)
Deferred tax — — 1,607 489 (1,161) 1,161 — — —
Net profit 17,324 1,362 12,994 29,520 15,445 20,599 36,076 34,087 37,391
Adjusted net profit 15,796 1,382 10,076 31,931 15,445 16,331 36,076 34,087 37,391
Earnings per share (Rs) 8.5 0.7 5.5 17.4 8.4 8.9 19.6 18.6 20.4
Balance sheet (Rs mn)
Equity 104,845 99,881 106,790 125,546 132,385 145,717 167,362 187,814 210,249
Deferred tax liability 11,307 10,606 8,937 8,682 9,578 8,414 8,414 8,414 8,414
Current liabilities 28,383 27,304 20,414 33,131 28,489 31,568 31,314 32,906 33,712
Other current liabilities 6,267 7,582 10,487 7,322 6,458 8,095 8,095 8,095 8,095
Total liabilities 151,470 145,496 147,089 174,888 177,387 194,186 215,577 237,621 260,862
Net fixed assets 79,533 83,517 84,982 87,654 96,613 109,817 125,569 140,816 154,012
Investments 2,566 3,323 5,599 3,773 4,708 5,252 5,252 5,252 5,252
Cash 34,964 19,805 17,498 37,061 21,175 25,752 29,067 33,496 42,341
Other current assets 20,983 25,223 23,082 27,100 30,374 33,818 36,143 38,510 39,711
Other non current assets 13,425 13,629 15,928 19,302 24,516 19,547 19,547 19,547 19,547
Total assets 151,470 145,496 147,089 174,888 177,387 194,186 215,577 237,621 260,862
Net debt (35,104) (20,232) (19,521) (37,494) (22,153) (27,089) (30,405) (34,833) (43,679)
Free cash flow (Rs mn)
Operating cash flow excl. working capital 20,153 4,431 17,762 38,911 17,908 27,277 41,718 40,226 46,062
Working capital changes 3,935 (7,917) 4,228 1,585 (8,825) (84) (2,578) (776) (394)
Net finance cost/ income 2,678 2,246 906 1,019 702 2,015 2,106 2,114 2,133
Cash flow from operations 26,766 (1,239) 22,896 41,515 9,784 29,209 41,246 41,563 47,802
Capital expenditure (Rs mn) (7,409) (8,336) (9,265) (11,782) (13,054) (15,605) (23,500) (23,500) (24,000)
Free cash flow (Rs mn) 46,123 (10,814) 36,526 29,732 (3,270) 13,603 17,746 18,063 23,802
Ratios
P/B (X) 3.7 3.9 3.6 3.1 2.9 2.7 2.3 2.1 1.8
P/E (X) 24.8 283.8 29.7 13.1 25.0 18.7 10.7 11.3 10.3
EV/EBITDA (X) 13.4 76.1 24.6 7.7 14.9 12.5 6.6 6.8 5.8
FCF Yield (%) 11.8 (2.8) 9.5 7.7 (0.8) 3.5 4.6 4.7 6.2
Cash Per Share 18.7 10.6 9.5 20.2 11.5 14.0 15.8 18.2 23.1
Net debt/EBITDA (X) (1.3) (4.1) (1.3) (0.8) (0.9) (0.9) (0.6) (0.7) (0.7)
Net debt/equity (X) (0.3) (0.2) (0.2) (0.3) (0.2) (0.2) (0.2) (0.2) (0.2)
Book value (Rs/share) 56 54 58 68 72 79 91 102 114
Dividend Yield (%) 2.7 0.7 1.7 3.1 2.1 2.4 3.7 3.5 3.9
RoAE (%) 15.1 1.4 9.8 27.5 12.0 11.7 23.0 19.2 18.8
RoACE (%) 12.4 (0.2) 8.4 25.9 10.6 10.6 22.0 18.3 18.0

UPDATE
Cyient (CYL) BUY

IT Services
CMP(₹): 1,881 Fair Value(₹): 2,050 Sector View: Neutral NIFTY-50: 25,811 October 01, 2024
Management perspectives on semiconductor initiatives Company data and valuation summary

We hosted Cyient’s management—Krishna Bodanapu (Executive Vice Stock data
Chairman and MD), Prabhakar Atla (CFO), Ramya Mohan (Head of Strategy)
CMP(Rs)/FV(Rs)/Rating 1,881/2,050/BUY
and Satish Kumar Ganesan (Delivery Head of Semiconductor)—to gather
52-week range (Rs) (high-low) 2,459-1,542
more details about its semiconductor initiatives. The key highlights are (1)
Mcap (bn) (Rs/US$) 209/2.5
the ASIC market is expected to see 10-12% CAGR over CY2023-31, 3X of
ADTV-3M (mn) (Rs/US$) 1,165/13.9
general purpose chips, driven by IT-OT integration; (2) Cyient is expanding its
play across the ASIC development value chain, leveraging its IP and Shareholding pattern (%)
ecosystem partnerships in focus verticals; and (3) Cyient (DET) would
continue to focus on engineering services while Cyient Semiconductor would
8.5
operate independently, reporting to Krishna. 23.2
12.9
ASICs are a large and rapidly growing opportunity 2.4
The global ASIC market is currently at US$24.6 bn and is expected to see 10-
12% CAGR to US$51 bn by CY2031, 3X of general purpose chips. ASIC turnkey 23.6
29.5
solutions value chain has the following stages: (1) EDA, licensors, (2) design,
(3) manufacturing, (4) assembly, test & packaging, (5) component assembly Promoters FPIs MFs BFIs Retail Others
and (6) end-product users. Hitherto, Cyient has focused primarily on providing
Private Circulation Only. This document may only be distributed to QIBs (qualified institutional buyers) as defined under rule 144A of the Securities Act of 1933
design services to clients. The verticals to which Cyient (DET) has exposure Price performance (%) 1M 3M 12M
Absolute (5) 2 11
contribute ~2/3 rd of the overall market opportunity in ASIC turnkey solutions.
Rel. to Nifty (7) (5) (20)
Increased focus as an independent subsidiary Rel. to MSCI India (8) (7) (31)
Cyient Semiconductor has been set up as a wholly-owned subsidiary to focus
on end-to-end ASIC development and dedicated leadership. It currently has 500 Forecasts/Valuations 2025E 2026E 2027E
employees, with a few transitioning from Cyient (DET) and lateral hires to EPS (Rs) 65.7 79.3 88.2
address the white spaces. The objective of Cyient Semiconductor is to better EPS growth (%) (0.9) 20.7 11.2
address low-volume, high variance requirements of clients, leveraging client P/E (X) 28.6 23.7 21.3
relationships, IP and ecosystem partnerships. Management indicated that P/B (X) 4.2 3.9 3.6
design is only a small portion of (~16-17%) of turnkey ASIC development. EV/EBITDA (X) 16.1 13.4 11.9
Currently, ASIC turn-key business is around US$15 mn for Cyient, including chip RoE (%) 15.4 17.1 17.6
Div. yield (%) 2.1 2.6 3.2
sales, and operates at 30%+ RoCE. The business will have dedicated GTM: (1)
Sales (Rs bn) 75 85 97
direct channel―DET’s clients and approaching clients’ businesses that were not
EBITDA (Rs bn) 12 15 17
addressed earlier and (2) ecosystem partnerships. Asian peers such as Global
Net profits (Rs bn) 7 9 10
Unichip Corp (GUC) and Alchip are focused on digital chips, but Cyient
Semiconductor would be working on mixed-signal chips. In India, the company Source: Bloomberg, Company data, Kotak Institutional Equities estimates
plans to cater to low-power NB-IoT and power electronics. Prices in this report are based on the market close of
September 30, 2024
Capital cycle will be longer, but manageable
Turnkey engagements include design and production phases. The design phase
would be a 2-3 year cycle, with revenues recognized on the basis of the
achievement of milestones. In the production phase, revenues are recognized
on the basis of unit sales. Cyient plans to leverage its IP suite to accelerate
development. A few engagements might also include royalty-based payments Related Research
depending on the usage of IP. Cyient Semiconductor would focus on the → Cyient: An interesting bet
development of 28 nm chips, where NRE is significantly lower than state-of-the-
→ Cyient: Murphy’s law at play
art chips. The company expects margins in the production phase to be similar
→ Cyient: FY2024 annual report analysis
or better than those of the design phase. DET will remain focused on services.
Management hopes that the initiatives will deliver faster results as compared
to DLM. Full sector coverage on KINSITE
Kawaljeet Saluja Vamshi Krishna Sathishkumar S

10
Exhibit 1: Cyient SoTP valuation

% stake Value per share (Rs)
DET segment
September 2026 PAT for services DET 7,969
Multiple (X) 23
Attributable equity value for DET 198,281 100.0 1,789
Cyient DLM
Current market price (Rs) 669
No. of outstanding shares (mn) 79
Discount to CMP (%) 20
Attributable equity value for Cyient DLM 42,710 66.7 257
Cyient others (at acquisition price)
At acquisition price 458 4
Combined equity value 227,214
Shares outstanding (mn) 110.9
Fair value (Rs/share) 2,050
Source: Kotak Institutional Equities
Exhibit 2: Cyient (DET) segment income statement, March fiscal year ends (Rs mn), 2021-27E
2021 2022 2023 2024 2025E 2026E 2027E
Revenue (US$ mn) 461 504 632 714 705 766 828
US$/Rs 74.3 74.5 80.6 82.8 83.3 84.3 85.0
Revenue 34,251 37,532 50,950 59,113 58,753 64,519 70,367
Employee costs (21,142) (22,148) (29,613) (33,946) (35,169) (37,886) (41,225)
Other expenses (7,125) (7,396) (12,166) (13,207) (12,710) (13,999) (15,256)
EBITDA 5,515 7,471 9,171 11,960 10,874 12,634 13,886
Depreciation and amortization (1,759) (1,730) (2,198) (2,415) (2,527) (2,545) (2,795)
EBIT 3,755 5,741 6,973 9,545 8,346 10,090 11,091
Other Income 1,166 1,121 751 382 592 764 854
Finance costs (481) (434) (747) (915) (573) (734) (821)
Profit before tax 4,440 6,428 6,977 9,011 8,365 10,120 11,124
Provision for Tax (1,095) (1,652) (1,724) (2,104) (2,064) (2,530) (2,837)
Profit before minority interest 3,345 4,777 5,253 6,908 6,302 7,590 8,288
Minority Interest and associate income ― 0 ― (10) ― ― ―
Profit before extraordinaries 3,345 4,777 5,253 6,898 6,302 7,590 8,288
Extraordinaries (net of tax) (76) ― (506) (519) ― ― ―
Net profit - Reported 3,269 4,777 4,747 6,379 6,302 7,590 8,288
Key metrics
EBITDA margin (%) 16.1 19.9 18.0 20.2 18.5 19.6 19.7
EBIT margin (%) 11.0 15.3 13.7 16.1 14.2 15.6 15.8
PBT margin (%) 13.0 17.1 13.7 15.2 14.2 15.7 15.8
Net profit margin (%) 9.5 12.7 9.3 10.8 10.7 11.8 11.8
Growth Rates (%)
US$ revenues (16.3) 9.2 25.6 12.9 (1.3) 8.6 8.1
Revenues (12.2) 9.6 35.8 16.0 (0.6) 9.8 9.1
EBITDA (5.9) 35.5 22.7 30.4 (9.1) 16.2 9.9
EBIT (8.1) 52.9 21.5 36.9 (12.6) 20.9 9.9
PBT (7.9) 44.8 8.5 29.2 (7.2) 21.0 9.9
Adjusted Net profit (5.3) 42.8 10.0 31.3 (8.6) 20.4 9.2
Net profit - Reported (4.6) 46.1 (0.6) 34.4 (1.2) 20.4 9.2
Cyient
IT Services India Research
11
Exhibit 3: Condensed consolidated financials for Cyient, March fiscal year ends (Rs mn), 2021-27E
2021 2022 2023 2024E 2025E 2026E 2027E
Profit model
Revenue 41,325 45,344 60,159 71,473 74,878 85,437 97,112
Employee costs (21,611) (22,665) (30,260) (35,120) (36,618) (39,768) (43,632)
Other expenses (13,606) (14,462) (19,658) (23,324) (25,814) (30,900) (36,865)
EBITDA 6,108 8,217 10,241 13,029 12,446 14,768 16,614
Depreciation and amortization (1,944) (1,923) (2,566) (2,667) (2,698) (2,798) (3,120)
EBIT 4,164 6,294 7,675 10,362 9,748 11,970 13,494
Other income, net 685 687 (185) (500) 376 383 428
Pretax profits 4,849 6,981 7,490 9,862 10,124 12,353 13,922
Tax expense (1,133) (1,761) (1,838) (2,313) (2,457) (3,053) (3,498)
Minority interest and exceptional items (76) 0 (506) (719) (385) (509) (644)
Profit after tax 3,640 5,220 5,146 6,830 7,282 8,791 9,779
Dil. EPS (Rs) 33.1 47.8 46.9 61.6 65.7 79.3 88.2
Balance sheet
Total equity 29,541 31,134 34,635 45,569 49,287 53,610 57,763
Borrowings 3,184 3,264 9,336 4,526 4,526 4,526 4,526
Lease liabilities 2,590 2,470 2,842 3,350 3,426 3,503 3,583
Provisions 1,672 1,761 2,753 2,939 2,939 2,939 2,939
Other non-current liabilities 579 1,014 2,100 843 124 124 124
Other current liabilities 7,362 8,230 13,815 12,809 13,969 14,658 15,873
Total liabilities and equity 44,928 47,873 65,481 70,036 74,270 79,360 84,808
Cash and bank 14,650 12,666 7,194 9,835 12,555 14,078 14,535
Fixed assets 7,294 6,921 7,278 7,749 7,289 6,783 7,001
Intangible assets including goodwill 7,191 6,662 21,413 21,089 21,770 22,314 23,147
Receivables 8,026 7,333 11,271 12,617 13,129 14,981 17,028
Investments 344 4,448 5,181 4,356 4,356 4,356 4,356
Other assets 7,423 9,843 13,144 14,390 15,171 16,849 18,742
Total assets 44,928 47,873 65,481 70,036 74,270 79,360 84,808
Cashflow statement
Operating cash flow, excl. wc 7,164 8,970 10,313 12,642 12,820 15,195 17,100
Working capital changes 2,686 (973) (3,485) (2,606) 61 (2,812) (2,697)
Cash taxes paid (1,292) (1,652) (1,288) (2,775) (2,457) (3,053) (3,498)
Capital expenditure (985) (647) (645) (853) (1,498) (2,136) (2,671)
Acquisitions (721) (225) (8,989) (1,550) (1,268) ― ―
Other income 64 86 (711) (638) 376 383 428
Free cash flow 7,637 5,784 4,184 5,770 9,302 7,577 8,662
Key ratios and assumptions
Revenue growth (%) (6.7) 9.7 32.7 18.8 4.8 14.1 13.7
EBITDA margin (%) 14.8 18.1 17.0 18.2 16.6 17.3 17.1
EBIT margin (%) 10.1 13.9 12.8 14.5 13.0 14.0 13.9
RoAE (%) 13.2 17.2 15.6 17.0 15.4 17.1 17.6
RoACE (%) 9.9 13.6 14.4 16.1 13.4 15.4 16.0
Cyient
IT Services India Research
UPDATE
Quant Research
India
Sector View: NIFTY-50: 25,811 October 01, 2024
Alphabet Factor Portfolios: Unfazed by macro uncertainty, Momentum vs Low Vol performance in September (Rs)
multifactor portfolios continue to outperform
1.07
Our Alphabet Factor Portfolios continued to outperform in September, with Low-Vol
bulk of the outperformance coming after the Fed’s monetary policy 1.05
Momentum
announcement. While Low Vol was the preferred factor, Momentum 1.03
Nifty 50
portfolios were bruised in the first half of the month. Within this product, we
present the performance of four concentrated and four broad-based 1.01
portfolios based on single factors and a multifactor version of the same.

0.99
Momentum against Low Vol, winner takes all! 0.97
Investors positioned around the Low Vol names, while shunned the Momentum 0.95
positions to hedge against the uncertainty around the extent of anticipated rate- 30 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29
cuts by the Fed. While all of the broad-based single-factor portfolios

Source: Kotak Institutional Equities, FactSet
outperformed the Nifty 50 index, factor performance was a bit erratic within the
concentrated portfolios. Interestingly, after Low Vol, the Fundamental factor Prices in this report are based on the market close of
September 30, 2024
though being the next best-performing single factor in a broad set-up,
underperformed the benchmark in the concentrated form, further strengthening
our continued preference toward a diversified broad portfolio set-up. Quick Numbers
All-season portfolio—a bumpy ride followed by take-off!

Concentrated and broad-based all-season portfolios
Multifactor portfolios started on a bumpy ride, as they engaged in a slugfest outperform the Nifty by 3.0% and 2.5%, respectively, in
with the benchmark before the mid-month Fed outcome and a marginal edge the last month
toward the diversified broad-based set-up against the underperforming All broad-based single-factor portfolios outperform
concentrated version. Momentum recovered bulk of the pre-policy drawdowns the benchmark; investors preferred Low Vol over
momentum stocks
after the uncertainty around the Fed’s decision was over, thereby helping both
versions of the all-season portfolios to deliver more than 2X of the Nifty 50 in
September. We continue to prefer the blended multifactor approach over timing
single factors as a hedge against any unprecedented volatility due to the
upcoming macro events and the ongoing geo-political tensions.
What’s in for October 2024?

Tata Motors, Power Grid, TCS, Bharti Airtel and Sun Pharma form the multifactor
concentrated portfolio for October 2024. For the broad-based version, the
model has cut down its significant overweight position in durables and
increased its exposure to healthcare. The model has also reduced large
underweight exposure to energy stocks and turned marginally overweight
toward tech names from being underweight in the previous month. Want to
explore more on factor behavior over a broader universe? Our deep-dive
Anatomy of factors in large-, mid-, small-caps; also sectors cover a wide range
of factor anomalies across the size segments and sectors within the Nifty 500.
Bhavik Bochar, CFA

13
The Alphabet Suite of Factor Portfolios

Alphabet is a suite of four single-factor portfolios and a multifactor portfolio based on the Nifty 50 index
universe. Each month, the top-15 stocks based on the respective factor scores form the broad portfolio,
while the top-5 stocks form the concentrated portfolio for the said factor. Given the nature of
construction of these portfolios, it is highly likely that Alphabet portfolio recommendations may differ
from KIE Analyst Ratings for the same set of stocks.
Alphabet can be used by quantitative and fundamental managers for portfolio construction and a
screening tool to filter down the investment universe. The factor scores may also be used as an overlay
on the existing stock selection process in a multifactor framework by investment managers.
Our Alphabet portfolios show strong performance both on absolute and risk-adjusted basis not only
during the back-test period, but also after the model went live (out of sample).
Alphabet portfolios outperform Nifty 50 benchmark across investment horizons

Performance summary of Alphabet portfolios over different horizons
Sep24 Last 1 Year Out of Sample (Since Mar20) Full Backtest (Since Jan04)
Risk Risk Active Active Risk Active Active Avg.
Return Return (Stdev) Sharpe Return (Stdev) Sharpe Return Risk IR Return (Stdev) Sharpe Return Risk IR Turnover Max DD Hit Rate
Concentrated
All-Season 5.23% 53.35% 12.78% 4.17 30.16% 18.57% 1.62 7.69% 12.54% 0.61 27.44% 19.87% 1.38 10.95% 14.72% 0.74 65.14% -30.65% 61.45%
Fundamental 1.95% 47.74% 11.94% 4.00 22.09% 14.43% 1.53 0.30% 11.86% 0.03 21.66% 17.98% 1.21 5.52% 14.24% 0.39 10.92% -27.44% 58.63%
Momentum 1.23% 76.56% 14.47% 5.29 24.85% 24.57% 1.01 4.34% 15.71% 0.28 19.25% 24.80% 0.78 4.93% 14.93% 0.33 72.21% -54.40% 57.03%
Sentiment 5.33% 58.71% 13.64% 4.30 45.44% 21.19% 2.14 21.25% 11.67% 1.82 27.68% 24.53% 1.13 12.58% 13.10% 0.96 88.11% -43.54% 61.04%
Low Vol 6.56% 51.96% 9.06% 5.74 16.10% 15.65% 1.03 -4.68% 13.11% (0.36) 19.02% 17.67% 1.08 3.03% 14.89% 0.20 8.67% -29.57% 55.82%
Broad
All-Season 4.82% 56.83% 11.52% 4.93 27.13% 16.30% 1.66 5.14% 8.90% 0.58 21.75% 18.37% 1.18 6.26% 9.98% 0.63 41.87% -37.75% 61.04%
Fundamental 3.75% 43.61% 11.90% 3.66 26.12% 15.31% 1.71 4.16% 8.28% 0.50 18.68% 18.56% 1.01 3.62% 9.45% 0.38 8.86% -38.82% 55.82%
Momentum 2.39% 58.52% 12.93% 4.52 30.35% 21.17% 1.43 9.06% 8.53% 1.06 21.12% 21.72% 0.97 6.59% 9.19% 0.72 55.88% -50.23% 62.65%
Sentiment 3.66% 49.76% 12.01% 4.14 34.82% 17.77% 1.96 11.89% 8.63% 1.38 21.64% 21.66% 1.00 7.00% 8.63% 0.81 69.01% -46.54% 60.24%
Low Vol 4.25% 46.37% 9.41% 4.93 23.69% 15.23% 1.56 2.06% 8.92% 0.23 20.47% 17.24% 1.19 4.92% 9.76% 0.50 5.22% -38.46% 59.04%
Benchmark
Nifty 50 2.28% 31.43% 10.75% 2.92 19.98% 18.81% 1.06 13.46% 21.14% 0.64
Among the single-factor portfolios, Low Vol was the best performing factor with a 6.6% and 4.3% return
in the concentrated and broad-based baskets, respectively, in September compared with the 2.3% return
of the Nifty 50. Momentum portfolios suffered heavy drawdowns during the first half of the month, but
once the Fed policy was out, it regained bulk of its losses. While Fundamental was the next best-
performing factor in broad setup, it underperformed the benchmark in concentrated version. Owing to
its multifactor exposure, our all-season portfolios sailed through the market volatility and closed the
month, delivering more than 2X of Nifty 50 for concentrated and broad-based versions.
Quant Research
India Research
14
All-Season Portfolio
Cumulative performance since January 2004 Performance in last month
Broad Concentrated Nifty 50 Broad Concentrated Nifty 50

256.0 1.08
128.0
64.0 1.06
32.0
1.04
16.0
8.0 1.02
4.0
2.0 1.00
1.0
0.98
0.5
Jun-06
Jun-11
Jun-16
Jun-21
Sep-07
Sep-12
Sep-17
Sep-22
Dec-03
Dec-08
Dec-13
Dec-18
Dec-23
Mar-05
Mar-10
Mar-15
Mar-20
0.96
30 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29
Source: Kotak Institutional Equities, FactSet Source: Kotak Institutional Equities, FactSet
Sector exposure Avg. information coefficient decay profile over 12M
Utilities Sep-24 0.08
Technology Oct-24 0.07

Materials
0.06
Industrials
0.05
Healthcare
Financials 0.04
Energy 0.03
Cons. Services
0.02
Cons. Non-Durables
0.01
Cons. Durables
0.00
(30.00) (15.00) 0.00 15.00 30.00
1 2 3 4 5 6 7 8 9 10 11 12
Quant Research
India Research
15
All-season portfolio constituents for October 2024

Weight KIE Analyst
Sedol Name ISIN Sector Nifty 50 Broad Portfolio Concentrated Portfolio Recommendation
B611LV1 Tata Motors Limited INE155A01022 Cons. Durables 1.79% 3.54% 10.29% ADD
B233HS6 Power Grid Corporation of India Limited INE752E01010 Utilities 1.39% 5.16% 14.99% SELL
B01NPJ1 Tata Consultancy Services Limited INE467B01029 Technology 3.76% 5.26% 15.27% ADD
6442327 Bharti Airtel Limited INE397D01024 Technology 4.00% 10.14% 29.44% ADD
6582483 Sun Pharmaceutical Industries Limited INE044A01036 Healthcare 1.81% 10.43% 30.00% ADD
B011108 Cipla Ltd INE059A01026 Healthcare 0.76% 6.08% ADD
BSQCB24 State Bank of India INE062A01020 Financials 2.65% 5.54% BUY
6205122 Infosys Limited INE009A01021 Technology 5.93% 3.89% BUY
6099626 Reliance Industries Limited INE002A01018 Energy 8.89% 6.48% ADD
BQB8GH3 Nestle India Ltd. INE239A01024 Cons. Non-Durables 0.84% 10.36% ADD
6121488 Tata Consumer Products Limited INE192A01025 Cons. Non-Durables 0.68% 6.29% NR
BGSQG47 Britannia Industries Ltd INE216A01030 Cons. Non-Durables 0.64% 9.82% ADD
B2QKXW0 Bajaj Auto Limited INE917I01010 Cons. Durables 1.22% 6.60% SELL
B4Z9XF5 Coal India Ltd. INE522F01014 Energy 1.01% 3.38% SELL
BZ60N32 SBI Life Insurance Co. Ltd. INE123W01016 Financials 0.73% 7.03% BUY
Quant Research
India Research
16
Fundamental portfolio
64.0 Broad Concentrated Nifty 50 1.05 Broad Concentrated Nifty 50
32.0 1.04
16.0
1.03
8.0
1.02
4.0
1.01
2.0
1.00
1.0
0.99
0.5
Dec-03
Dec-07
Dec-11
Dec-15
Dec-19
Dec-23
Apr-05
Apr-09
Apr-13
Apr-17
Apr-21
Aug-06
Aug-10
Aug-14
Aug-18
Aug-22
0.98
30 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29
0.03
Utilities Sep-24
Technology Oct-24
Materials
Industrials 0.02
Healthcare
Financials
Energy 0.01
Cons. Services
Cons. Non-Durables
Cons. Durables
0.00
(30.00) (15.00) 0.00 15.00 30.00 1 2 3 4 5 6 7 8 9 10 11 12
Quant Research
India Research
17
Fundamental portfolio constituents for October 2024

FUNDAMENTAL Weight KIE Analyst
B4Z9XF5 Coal India Ltd. INE522F01014 Energy 1.01% 4.53% 11.10% SELL
B01NPJ1 Tata Consultancy Services Limited INE467B01029 Technology 3.76% 7.05% 17.26% ADD
BQB8GH3 Nestle India Ltd. INE239A01024 Cons. Non-Durables 0.84% 13.88% 30.00% ADD
BGSQG47 Britannia Industries Ltd INE216A01030 Cons. Non-Durables 0.64% 13.16% 30.00% ADD
6410959 Dr. Reddy's Laboratories Ltd. INE089A01023 Healthcare 0.71% 7.02% REDUCE
BK1N461 HDFC Bank Limited INE040A01034 Financials 11.37% 7.91% BUY
BCRWL65 Asian Paints Ltd. INE021A01026 Industrials 1.29% 5.27% REDUCE
BMW4CV8 Eicher Motors Limited INE066A01021 Cons. Durables 0.60% 5.14% SELL
6802608 Shriram Finance Limited INE721A01013 Financials 0.87% 3.92% BUY
6602518 Divi's Laboratories Limited INE361B01024 Healthcare 0.60% 3.26% SELL
B037HF1 NTPC Limited INE733E01010 Utilities 1.79% 6.75% SELL
BD6F8V6 LTIMindtree Limited INE214T01019 Industrials 0.49% 3.30% ADD
Quant Research
India Research
18
Momentum portfolio

64.0 1.04
1.03
32.0
1.02
16.0
1.01
8.0 1.00
4.0 0.99
0.98
2.0
0.97
1.0
0.96
0.5 0.95
Jun-06
Jun-11
Jun-16
Jun-21
Sep-07
Sep-12
Sep-17
Sep-22
Dec-13
Dec-03
Dec-08
Dec-18
Dec-23
Mar-05
Mar-10
Mar-15
Mar-20
0.94
30 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29
Sep-24 0.07
Utilities
Technology Oct-24 0.06
Materials 0.05
Industrials 0.04
Healthcare 0.03
Financials
0.02
Energy
0.01
Cons. Services
0.00
Cons. Non-Durables
(0.01)
Cons. Durables
(0.02)
(30.00) (15.00) 0.00 15.00 30.00 1 2 3 4 5 6 7 8 9 10 11 12
Quant Research
India Research
19
Momentum portfolio constituents for October 2024

Weight KIE Analyst
B28XXH2 Adani Ports & Special Economic Zone Limited INE742F01042 Industrials 0.92% 2.67% 11.20% BUY
6139362 Oil & Natural Gas Corp. Ltd. INE213A01029 Energy 1.00% 4.70% 19.72% REDUCE
B4Z9XF5 Coal India Ltd. INE522F01014 Energy 1.01% 4.92% 20.65% SELL
6099723 Bharat Petroleum Corporation Limited INE029A01011 Energy 0.62% 6.38% 26.77% SELL
6410959 Dr. Reddy's Laboratories Ltd. INE089A01023 Healthcare 0.71% 7.62% REDUCE
6327327 Hero Motocorp Limited INE158A01026 Cons. Durables 0.67% 6.55% SELL
B01NPJ1 Tata Consultancy Services Limited INE467B01029 Technology 3.76% 7.65% ADD
BWFGD63 Tech Mahindra Limited INE669C01036 Technology 0.88% 4.44% REDUCE
B233HS6 Power Grid Corporation of India Limited INE752E01010 Utilities 1.39% 7.51% SELL
Quant Research
India Research
20
Sentiment Portfolio

256.0 1.07
128.0 1.06
64.0 1.05
32.0
1.04
16.0
1.03
8.0
1.02
4.0
1.01
2.0
1.0 1.00
0.5 0.99
Jun-06
Jun-11
Jun-16
Jun-21
Sep-07
Sep-12
Sep-17
Sep-22
Dec-03
Dec-08
Dec-13
Dec-18
Dec-23
Mar-05
Mar-10
Mar-15
Mar-20
0.98
30 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29
Utilities Sep-24 0.04
Technology Oct-24
0.03
Materials
Industrials 0.02
Healthcare
Financials 0.01
Energy
0.00
Cons. Services
Cons. Non-Durables (0.01)
Cons. Durables
(0.02)
(30.00) (15.00) 0.00 15.00 30.00 1 2 3 4 5 6 7 8 9 10 11 12
Quant Research
India Research
21
Sentiment portfolio constituents for October 2024

Weight KIE Analyst
6802608 Shriram Finance Limited INE721A01013 Financials 0.87% 3.43% 8.20% BUY
B233HS6 Power Grid Corporation of India Limited INE752E01010 Utilities 1.39% 6.04% 14.47% SELL
BZ60N32 SBI Life Insurance Co. Ltd. INE123W01016 Financials 0.73% 8.23% 19.71% BUY
6139340 Titan Company Limited INE280A01028 Cons. Durables 1.37% 4.89% REDUCE
BZBYJJ7 JSW Steel Limited INE019A01038 Materials 0.82% 4.38% REDUCE
6261674 Hindustan Unilever Limited INE030A01027 Cons. Non-Durables 2.28% 8.67% ADD
BQB8GH3 Nestle India Ltd. INE239A01024 Cons. Non-Durables 0.84% 12.12% ADD
6602518 Divi's Laboratories Limited INE361B01024 Healthcare 0.60% 2.85% SELL
B01NPJ1 Tata Consultancy Services Limited INE467B01029 Technology 3.76% 6.16% ADD
BMTWGK2 Bajaj Finserv Limited INE918I01026 Financials 0.94% 4.60% NA
BD6F8V6 LTIMindtree Limited INE214T01019 Industrials 0.49% 2.88% ADD
Quant Research
India Research
22
Low Volatility Portfolio

64.0 1.10
32.0
1.08
16.0
1.06
8.0
4.0 1.04
2.0
1.02
1.0
1.00
0.5
Jun-06
Jun-11
Jun-16
Jun-21
Sep-07
Sep-12
Sep-17
Sep-22
Dec-08
Dec-03
Dec-13
Dec-18
Dec-23
Mar-05
Mar-10
Mar-15
Mar-20
0.98
30 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29

0.05
Utilities Sep-24
Technology Oct-24
0.04
Materials
Industrials
0.03
Healthcare
Financials
0.02
Energy
Cons. Services
0.01
Cons. Non-Durables
Cons. Durables
0.00
(20.00) 0.00 20.00 40.00 1 2 3 4 5 6 7 8 9 10 11 12
Quant Research
India Research
23
Low Volatility portfolio constituents for October 2024

Weight KIE Analyst
BSZ2BY7 ICICI Bank Limited INE090A01021 Financials 7.92% 7.79% 17.73% BUY
BGSQG47 Britannia Industries Ltd INE216A01030 Cons. Non-Durables 0.64% 8.71% 19.82% ADD
BQB8GH3 Nestle India Ltd. INE239A01024 Cons. Non-Durables 0.84% 9.19% 20.91% ADD
BK1N461 HDFC Bank Limited INE040A01034 Financials 11.37% 5.24% BUY
6099626 Reliance Industries Limited INE002A01018 Energy 8.89% 5.75% ADD
6261674 Hindustan Unilever Limited INE030A01027 Cons. Non-Durables 2.28% 6.57% ADD
6121488 Tata Consumer Products Limited INE192A01025 Cons. Non-Durables 0.68% 5.58% NR
B0JGGP5 ITC Limited INE154A01025 Cons. Non-Durables 4.16% 6.67% ADD
6633712 Maruti Suzuki India Limited INE585B01010 Cons. Durables 1.54% 4.66% SELL
B233HS6 Power Grid Corporation of India Limited INE752E01010 Utilities 1.39% 4.58% SELL
Quant Research
India Research
UPDATE
Economy
External Sector
September 30, 2024
External balance remains comfortable Summary of key macro metrics for India
CAD in 1QFY25 was at US$9.8 bn (1.1% of GDP), supported by relatively 2023 2024 2025E 2026E
strong services trade surplus and remittances inflow, even as goods trade Real economy
deficit widened from 4QFY24. Capital account weakened from 4QFY24, with Real GDP growth (%) 7.0 8.2 6.9 6.7
Nominal GDP growth (%) 14.2 9.6 11.3 11.2
a sharp decline in FPI flows, even as FDI flows increased. We maintain our
CPI Inflation (avg., %) 6.7 5.4 4.5 4.2
FY2025-26 CAD/GDP estimates at 1.2%/1.3% and our average FY2025/26
Public finance
USD-INR estimates at 83.6/84.75. Center's GFD/GDP (%) 6.4 5.6 4.6 4.5
Monetary policy
Current account moved back to deficit in 1QFY25 Repo Rate (%, eop) 6.50 6.50 6.00 5.50
SDF Rate (%, eop) 6.25 6.25 5.75 5.25
The current account in 1QFY25 moved back to a deficit of US$9.8 bn (1.1% of
CRR (%, eop) 4.5 4.5 4.5 4.5
GDP)—4QFY24 current account surplus revised down to US$4.6 bn (Exhibit 1). External sector
Goods trade deficit widened to US$65 bn (4QFY24: revised up to US$52 bn). Current Account Balance (% of GDP) (2.0) (0.7) (1.2) (1.3)
Net invisible surplus moderated slightly to US$55 bn (4QFY24: US$57 bn), with Brent crude oil price (avg., USD/bbl) 95.4 82.9 80.0 80.0
USD/INR (avg.) 80.3 82.8 83.6 84.8
non-software surplus at US$2 bn (US$6 bn). Travel services was the main drag
on non-software services ((-)US$1.8 bn), while net software exports were Source: CEIC, Bloomberg, RBI, Kotak Economics Research estimates
steady at around US$37 bn and professional/management consulting services

were steady at around US$10 bn (Exhibit 2).
Capital flows weakened in 1QFY25 due to weak FPI flows Quick Numbers
Capital account surplus in 1QFY25 reduced to US$14.4 bn (4QFY24: US$25.6
bn). Most of the fall was due to FPI flows reducing to US$1 bn (4QFY24: US$11 Current account deficit at 1.1% of GDP in 1QFY25
bn), even as net FDI improved to US$6 bn (4QFY24: US$2 bn) (Exhibit 1).
1QFY25 capital account surplus at US$14.4 bn
Banking capital was at US$3 bn (4QFY24: US$7 bn). 1QFY25 BOP was at US$5.2
bn; lower than US$31 bn in 4QFY24.
Maintain FY2025 CAD/GDP estimate at 1.2% (1.3% in
FY2026E)
External sector balance will remain comfortable in FY2025
We estimate FY2025 CAD/GDP at 1.2% (US$48.9 bn), with assumptions of (1) Expect USD-INR to average 83.6 in FY2025E
imports outpacing exports, given a relatively stronger domestic demand relative
to global demand, and (2) average crude price of around US$80/bbl (Exhibit 3).
We pencil in a goods trade deficit at around US$270 bn, while services trade
surplus should hold steady around US$165 bn. Furthermore, we continue to
expect a steady capital account surplus in FY2025E at US$68 bn (healthy FPI
flows, slight improvement in FDI), resulting in a BOP surplus of around US$25
bn.
Global monetary policy will continue to weigh on INR outlook in near term
While we expect the external sector balance to be comfortable, concerns will
remain around (1) volatile commodity prices, (2) the re-emergence of
geopolitical tensions and (3) an asynchronous global monetary policy cycle,
which is already underway. Volatility around the key events such as Fed policy
moves, China’s stimulus measures and BOJ policy moves will likely continue to Related Research
weigh on INR. The RBI will remain active in curbing undue volatility. We continue → Gold-led widening of the trade deficit
to expect USD-INR to trade within the 83.25-84.25 range through the rest of
→ Goods trade deficit remains elevated
FY2025; the USD-INR average estimate is at 83.6 for FY2025 and for FY2026, it
→ India’s external balance remains strong
would average at 84.75 (Exhibit 4).
Suvodeep Rakshit Upasna Bhardwaj Harsh Doshi

25
Current account deficit at 1.1% of GDP in 4QFY24

India's quarterly balance of payments, March fiscal year-ends, 1QFY24-1QFY25 (US$ bn)
1QFY24 2QFY24 3QFY24 4QFY24 1QFY25
Current account (9.0) (11.3) (10.4) 4.6 (9.8)
GDP 858 858 909 943 927
CAD/GDP (%) (1.0) (1.3) (1.1) 0.5 (1.1)
Trade balance (57) (65) (72) (52) (65)
Trade balance/GDP (%) (6.6) (7.5) (7.9) (5.5) (7.0)
- Exports 105 108 107 122 111
- oil exports 19 23 20 22 21
- non-oil exports 86 86 86 99 91
- Imports 162 173 178 174 176
- oil imports 42 42 46 49 51
- non-oil imports 120 131 132 125 125
- gold imports 10 13 14 10 10
Invisibles (net) 48 53 61 57 55
- Services 35 40 45 43 40
o/w Software 34 35 36 37 37
o/w Non-software 1 5 9 6 2
- Transfers 23 25 29 29 26
- Income (net) (10) (12) (13) (15) (11)
Capital account 33.8 12.8 17.3 25.6 14.4
% of GDP 3.9 1.5 1.9 2.7 1.6
Foreign investment 20 4 16 14 7
- FDI 5 (1) 4 2 6
- FPI 16 5 12 11 1
- Equities 14 4 7 1 (1)
- Debt 2 2 5 10 2
Banking capital 13 4 16 7 3
- NRI deposits 2 3 4 5 4
Short-term credit (5) 5 (1) 0 3
ECBs 6 (3) (4) 2 2
External assistance 1 1 3 2 1
Other capital account items (2) 1 (12) 1 (2)
E&O (0) 1 (1) 1 1
Overall balance 24.4 2.5 6.0 30.8 5.2
memo items:
Average exchange rate (US$/Rs) 82.1 82.7 83.3 83.0 83.4
Average Brent price (US$/bbl) 78.1 85.9 84.3 83.1 83.0
Source: RBI, Kotak Economics Research
Economy
India Research
26
Lower travel net exports dragged down non-software services exports in 1QFY25
Breakup of net exports in non-software services (US$ bn)
Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24
Services 31.1 34.4 38.7 39.1 35.1 39.9 45.0 42.7 39.7
- Software 31.1 33.0 33.9 34.5 34.2 35.6 36.4 36.4 37.3
- Non-software (0.0) 1.5 4.8 4.6 0.9 4.4 8.6 6.3 2.4
- Transport (1.9) (1.8) (0.7) (0.1) (0.3) (0.2) 0.5 (0.1) (0.1)
- Travel (1.6) (1.8) 1.2 0.7 (3.1) (1.2) 2.4 1.9 (1.8)
- Construction 0.0 0.0 0.6 0.4 0.2 0.3 0.5 0.9 0.9
- Insurance and pension 0.4 0.2 (0.0) 0.4 0.2 0.0 (0.0) 0.3 0.3
- Financial 0.1 0.5 0.7 0.8 0.7 0.9 1.5 0.3 0.9
- IP charges (1.9) (1.9) (3.1) (2.4) (3.3) (2.9) (4.2) (3.0) (4.1)
- Other business 3.4 5.2 6.1 5.9 6.6 7.8 8.6 6.2 6.4
R&D 1.6 1.6 1.6 1.8 1.6 1.6 1.7 1.5 1.5
Professional & management consulting 8.3 9.8 11.2 11.6 11.5 11.6 12.1 10.2 10.2
Technical, trade related, etc (6.4) (6.2) (6.7) (7.4) (6.5) (5.4) (5.2) (5.5) (5.3)
- Others 1.4 1.0 0.0 (1.1) (0.2) (0.3) (0.6) (0.2) (0.1)
Source: CEIC, RBI, Kotak Economics Research
We maintain our FY2025 CAD/GDP estimate at 1.2%

India's balance of payments, March fiscal year-ends, 2019-25E (US$ bn)
2025E
2019 2020 2021 2022 2023 2024 Oil @ 80 Oil @ 75 Oil @ 70
Current account balance (57.3) (24.7) 23.9 (38.8) (67.1) (26.1) (48.9) (40.5) (32.1)
GDP 2,705 2,835 2,674 3,167 3,352 3,567 3,932 3,932 3,932
CAB/GDP (%) (2.1) (0.9) 0.9 (1.2) (2.0) (0.7) (1.2) (1.0) (0.8)
Trade balance (180) (158) (102) (189) (265) (245) (269) (261) (252)
Trade balance/GDP (%) (6.7) (5.6) (3.8) (6.0) (7.9) (6.9) (6.8) (6.6) (6.4)
- Exports 337 320 296 429 456 441 438 436 433
- oil exports 47 41 26 67 97 84 88 85 83
- non-oil exports 291 279 270 362 359 357 351 351 351
- Imports 518 478 398 619 721 686 707 697 686
- oil imports 141 131 83 162 209 179 187 176 165
- non-oil imports 377 347 316 457 512 508 520 520 520
- gold imports 33 28 35 46 35 46 55 55 55
Invisibles (net) 123 133 126 151 198 219 220 220 220
- Services 82 85 89 108 143 163 165 165 165
- software 78 85 90 110 131 142 143 143 143
- non-software 4 0.3 (1) (2) 12 21 22 22 22
- Transfers 70 75 73 80 101 106 107 107 107
- Income (net) (29) (27) (36) (37) (46) (50) (52) (52) (52)
Capital account 54 83 64 86 59 90 68 68 68
Capital account/GDP (%) 2.0 2.9 2.4 2.7 1.8 2.5 1.7 1.7 1.7
Foreign investment 30 44 80 22 23 54 49 49 49
- FDI 31 43 44 39 28 10 14 14 14
- FPI (1) 1 36 (17) (5) 44 35 35 35
- Equities 3 (0) 39 (16) (6) 25 10 10 10
- Debt (4) 1 (0) 2 1 19 25 25 25
Banking capital 7 (5) (21) 7 21 41 15 15 15
- NRI deposits 10 9 7 3 9 15 10 10 10
Short-term credit 2 (1) (4) 20 7 (1) — — —
ECBs 10 23 (0) 8 (4) (0) 2 2 2
External assistance 3 4 11 5 6 7 2 2 2
Other capital account items 1 18 (2) 24 7 (12) — — —
E&O (0) 1 (0) — (1) 0 — — —
Overall balance (3.3) 59.5 87.3 47.5 (9.1) 63.7 19.1 27.5 35.9
Memo items
Average USD/INR 69.9 70.9 74.2 74.5 80.3 82.8 83.6 83.6 83.6
Average Brent (US$/bbl) 70.0 60.9 44.8 80.0 95.4 82.9 80.0 75.0 70.0
Source: RBI, Kotak Economics Research estimates
Economy
India Research
27
We expect USD-INR within 83.25-84.25 through the rest of FY2025

Trend and estimates of INR and major currencies against USD, March fiscal year-ends (X)
2020 2021 2022 2023 2024 2025E 1QFY24 2QFY24 3QFY24 4QFY24 1QFY25 2QFY25 3QFY25E 4QFY25E
Average Rate
USDINR 70.9 74.2 74.5 80.4 82.8 83.6 82.2 82.7 83.3 83.0 83.4 83.8 83.5 83.8
EURUSD 1.11 1.14 1.16 1.04 1.08 1.10 1.09 1.09 1.08 1.09 1.08 1.10 1.10 1.11
GBPUSD 1.27 1.31 1.37 1.21 1.26 1.29 1.25 1.27 1.24 1.27 1.26 1.30 1.30 1.31
USDJPY 108.7 106.0 112.4 135.6 144.6 146.2 137.5 144.6 147.8 148.6 156.0 149.0 140.0 140.0
Depreciation (-)/appreciation (+) against USD (%)
INR (1.4) (4.5) (0.4) (7.3) (2.9) (1.0) 0.1 (0.5) (0.7) 0.3 (0.5) (0.4) 0.3 (0.3)
EUR (4.1) 2.8 1.7 (10.3) 4.0 1.1 1.5 (0.1) (1.1) 0.8 (0.8) 2.1 0.1 0.9
GBP (3.2) 2.9 4.5 (11.7) 4.2 2.9 3.0 1.1 (1.9) 2.1 (0.5) 3.1 (0.1) 0.8
JPY 1.9 2.5 (5.6) (17.1) (6.2) (1.1) (3.7) (4.9) (2.2) (0.5) (4.7) 4.7 6.4 0.0
Source: Bloomberg. Kotak Economics Research estimates
Economy
India Research
UPDATE
Economy
Public Finance
October 01, 2024
Increasing chances of sharper fiscal consolidation Summary of key macro metrics for India
The central government’s fiscal deficit in 5MFY25 was 27% of FY2025BE, 2023 2024 2025E 2026E
with the pace of capital expenditure remaining weak while revenue Real economy
expenditure growth continuing to be moderate. The chances of a lower-than- Real GDP growth (%) 7.0 8.2 6.9 6.7
budgeted fiscal deficit are increasing, with receipts holding up and Nominal GDP growth (%) 14.2 9.6 11.3 11.2
CPI Inflation (avg., %) 6.7 5.4 4.5 4.2
expenditure pace remaining much moderate. We see scope for lower spends
Public finance
under a few heads that can potentially lower FY2025 GFD/GDP to around Center's GFD/GDP (%) 6.4 5.6 4.6 4.5
4.6%. Monetary policy
Repo Rate (%, eop) 6.50 6.50 6.00 5.50
Expenditure pace remains weak SDF Rate (%, eop) 6.25 6.25 5.75 5.25
CRR (%, eop) 4.5 4.5 4.5 4.5
Total expenditure in 5MFY25 was 34% of FY2025BE and 1.2% lower than
External sector
5MFY24 (Exhibit 1). Capital expenditure slowed down in August (50% mom Current Account Balance (% of GDP) (2.0) (0.7) (1.2) (1.3)
decline) after picking up pace in July. In 5MFY25, capex was 19% lower than in Brent crude oil price (avg., USD/bbl) 95.4 82.9 80.0 80.0
5MFY24 (27% of FY2025BE). The contraction was across all major heads. USD/INR (avg.) 80.3 82.8 83.6 84.8
However, compared to FY2025BE, railways and roads expenditure remain on

Source: CEIC, Bloomberg, RBI, Kotak Economics Research estimates
target while defense expenditure and loans to states for capex remain off the
targets. In 5MFY25, revenue expenditure was 4.1% higher than in 5MFY24,
Private Circulation Only. This document may only be distributed to QIBs (qualified institutional buyers) as defined under rule 144A of the Securities Act of 1933
mostly on the back of interest payments among major heads, while subsidies,
transfers to states and rural development spends remained weak. Quick Numbers
Receipts remain on point mostly due to personal taxes

5MFY24 GFD at 27% of FY2025BE, receipts at 38% of
Total receipts in 5MFY25 was 18% higher (38% of FY2025BE) than in 5MFY24 FY2025BE, expenditure at 34% of FY2025BE
(Exhibit 1). This was supported by strong growth in personal income taxes and
Direct taxes growth at 36% in 5MFY25; indirect taxes
non-tax revenues. Direct taxes in 5MFY25 stood 36% higher than in 5MFY24
growth at 9.5%; net tax revenues growth at 9%
(27% of FY2025BE), supported by personal income tax growth of 28%, while
corporation tax collections grew 4.8%. Indirect tax collection growth was 9.5% Expenditure growth at (-)1.2% in 5MFY25; capital
and 39% of FY2025BE. GST collections remain on target at 41% of FY2025BE expenditure growth at (-)19%; revenue expenditure
growth at 4.1%
and growth of 10.2%. Net tax revenues (post devolution to states) grew 9%,
amounting to 34% of FY2025BE targets in 5MFY25. Cut FY2025 GFD/GDP estimate to 4.6%
Cut our FY2025 GFD/GDP estimate to 4.6% assuming some savings

Center’s fiscal deficit in 5MFY25 was 27% of FY2025BE. Given the trends of
receipts and expenditures for 5MFY25, we see some upsides and downsides
possible for the full year. For receipts, we pencil in higher personal income tax
(18% growth over FY2024P against 14% in budget), while we assume
divestment at Rs200 bn against target of Rs500 bn (5MFY25 amount is Rs8 bn).
On the expenditure side, we pencil in growth of 10-11% in roads and railways
spends (budgeted growth of 3-4%) and lower spends on loans to states for
capex and on fund for new schemes/innovation. Overall, we see potential for
GFD/GDP at 4.6% (FY2025BE: 4.9%) after FY2024P of 5.6% (FY2024RE: 5.9%)
(Exhibit 2). While we lower our GFD/GDP estimate, we will closely watch for the Related Research
spending pattern in the next 2-3 months to be more sanguine. We pencil in lower → Center’s capital expenditure pace picks up
T-bill borrowings while keeping GSec borrowing unchanged.
→ Government spending picks up pace in June
→ FY2025 union budget: Prudent and balanced
Suvodeep Rakshit Upasna Bhardwaj Harsh Doshi

29
Fiscal deficit at 27% of FY2025BE in 5MFY25

Monthly fiscal details of the central government, March fiscal year-ends (Rs bn)
Chg. (%) FYTD (Apr-Aug) Chg. (%) FY2025BE FY2025
2025/ Current Required
Date Aug-24 Aug-23 Jul-24 yoy mom 2025 2024 2024 Rs bn (% of BE) run rate run rate
Gross tax revenues 2,485 2,950 2,534 (16) (1.9) 10,842 8,942 21 38,402 28 2,168 3,937
Direct taxes 1,034 1,722 1,228 (40) (16) 5,984 4,406 36 22,214 27 1,197 2,319
Corporation tax 401 628 98 (36) 309 1,846 1,761 4.8 10,200 18 369 1,193
Income tax + other taxes 633 1,094 1,130 (42) (44) 4,772 3,739 28 12,014 40 954 1,035
Indirect taxes 1,448 1,225 1,305 18 10.9 6,296 5,749 9.5 16,187 39 1,259 1,413
Customs duty 268 185 205 45 31 943 835 12.9 2,377 40 189 205
Excise duty 272 236 255 15 6.8 1,040 998 4.2 3,190 33 208 307
Service tax 0 1 1 (64) (63) 0 4 (93) 1 32 0 0
GST 907 804 846 12.9 7.3 4,312 3,912 10.2 10,619 41 862 901
CGST 706 627 723 12.6 (2.3) 3,712 3,363 10.4 9,109 41 742 771
IGST 82 63 (5) 31 (1,800) (24) (29) (15) — (5) —
Compensation cess 119 114 128 4.2 (6.8) 625 577 8.2 1,510 41 125 126
Net tax revenues 1,586 2,214 1,656 (28) (4.2) 8,738 8,039 8.7 25,835 34 1,748 2,442
Non-tax revenues 327 308 218 6.2 50 3,345 2,096 60 5,457 61 669 302
Non-debt capital receipts 25 17 19 47 33 89 154 (42) 780 11 18 99
Total receipts 1,938 2,538 1,892 (24) 2.4 12,172 10,289 18 32,072 38 2,434 2,843
Total expenditure 3,520 2,911 3,304 21 6.5 16,524 16,718 (1.2) 48,205 34 3,305 4,526
Revenue expenditure 3,123 2,343 2,502 33 25 13,514 12,980 4.1 37,094 36 2,703 3,369
- Interest payments 723 677 638 6.8 13 4,002 3,675 8.9 11,629 34 800 1,090
- Subsidies 530 397 355 33 49 1,786 1,807 (1.2) 3,812 47 357 289
- Transfer to states (Min. of Fin.) 143 96 85 50 68 415 610 (32) 1,604 26 83 170
- Rural development 164 141 99 16 66 651 649 0.3 1,776 37 130 161
- Others 1,562 1,033 1,325 51 18 6,660 6,237 6.8 18,273 36 1,332 1,659
Capital expenditure 397 567 802 (30) (50) 3,010 3,738 (19) 11,111 27 602 1,157
- Defence 91 154 110 (41) (18) 346 479 (28) 1,822 19 69 211
- Railways 174 175 187 (1.0) (7.4) 1,028 1,127 (8.8) 2,520 41 206 213
- Roads and highways 134 83 321 61 (58) 1,057 1,102 (4.1) 2,722 39 211 238
- Loan to states for capex 91 78 15 16 503 289 412 (30) 1,500 19 58 173
- Others (92) 76 168 (221) (155) 290 618 (53) 2,546 11 58 322
Fiscal deficit 1,582 372 1,412 325 12.0 4,352 6,428 (32) 16,133 27 870 1,683
Revenue deficit 1,210 (178) 629 (780) 92 1,431 2,844 (50) 5,802 25 286 624
Primary deficit 860 (304) 774 (383) 11.1 350 2,753 (87) 4,504 8 70 593
Source: CEIC, Kotak Economics Research
Economy
India Research
30
We cut our FY2025 GFD/GDP estimate to 4.6%

Major central government budgetary items, March fiscal year-ends, 2019-25E (Rs bn)
Change (%)
2024P/ 2025BE/ 2025BE/ 2025E/ 2025E/
2019 2020 2021 2022 2023 2024RE 2024P 2025BE 2025E 2023 2024RE 2024P 2024RE 2024P
Receipts
1. Revenue receipts (2d + 3) 15,529 16,841 16,339 21,699 23,832 26,997 27,284 31,292 31,615 14 16 15 17 16
2. Gross tax revenues (a + b ) 20,805 20,101 20,271 27,093 30,542 34,372 34,648 38,402 38,881 13 12 11 13 12
2.a. Direct taxes 11,431 10,554 9,523 14,158 16,723 19,578 19,689 22,214 22,695 18 13 13 16 15
2.a.1. Corporation tax 6,636 5,569 4,577 7,120 8,258 9,227 9,111 10,200 10,200 10 11 12 11 12
2.a.2. Income tax (incl. other taxes) 4,796 4,985 4,946 7,038 8,464 10,352 10,579 12,014 12,495 25 16 14 21 18
2.b. Indirect taxes 9,373 9,547 10,748 12,935 13,819 14,794 14,959 16,187 16,186 8 9 8 9 8
2.b.1. Goods and Services Tax 5,816 5,988 5,488 6,981 8,491 9,566 9,570 10,619 10,619 13 11 11 11 11
2.b.1.1. CGST 4,575 4,941 4,563 5,912 7,185 8,116 8,206 9,109 9,109 14 12 11 12 11
2.b.1.2. IGST 289 91 73 21 47 — (50) — —
2.b.1.3. Compensation cess 951 956 852 1,048 1,259 1,450 1,414 1,510 1,510 12 4 7 4 7
2.b.2. Customs duty 1,178 1,093 1,348 1,997 2,134 2,187 2,331 2,377 2,377 9 9 2 9 2
2.b.2.1. Basic duties 1,048 906 1,065 1,460 1,676 1,670 1,779 1,869 1,869 6 12 5 12 5
2.b.2.2. Others 130 187 282 537 457 517 551 508 508 21 (2) (8) (2) (8)
2.b.3. Excise duty 2,310 2,406 3,897 3,946 3,190 3,036 3,053 3,190 3,190 (4) 5 4 5 4
2.b.4. Service tax 69 60 16 10 4 5 4 1 1 (2) (80) (76) (80) (76)
2.c Transfers to states, UTs, etc. 7,633 6,532 6,008 9,045 9,564 11,133 11,383 12,567 12,723 19 13 10 14 12
2.d Net tax revenues (2 - 2.c) 13,172 13,569 14,263 18,048 20,978 23,239 23,265 25,835 26,158 11 11 11 13 12
3. Non-tax revenues 2,357 3,272 2,076 3,651 2,854 3,758 4,019 5,457 5,457 41 45 36 45 36
3.a. RBI's transfer of surplus 680 1,476 600 991 303 874 874 2,104 2,104 188 141 141 141 141
3.b. Telecommunications 408 698 455 858 648 935 935 1,203 1,203 44 29 29 29 29
3.c. Others 1,269 1,097 1,021 1,802 1,903 1,949 2,209 2,150 2,150 16 10 (3) 10 (3)
4. Non-debt capital receipts (a + b) 1,128 686 576 394 722 560 605 780 480 (16) 39 29 (14) (21)
4.a Recovery of loans 181 183 197 247 262 260 273 280 280 4 8 2 8 2
4.b Other receipts (incl. disinvestments) 947 503 379 146 460 300 331 500 200 (28) 67 51 (33) (40)
5. Total receipts (1 + 4) 16,657 17,527 16,915 22,093 24,554 27,557 27,889 32,072 32,095 14 16 15 16 15
Expenditure
6. Revenue expenditure 20,074 23,506 30,835 32,009 34,531 35,402 34,940 37,094 36,622 1 5 6 3 5
6.a. Interest payments 5,826 6,121 6,799 8,055 9,285 10,554 10,639 11,629 11,629 15 10 9 10 9
6.b. Subsidies 1,968 2,283 7,077 4,461 5,310 4,135 4,135 3,812 3,812 (22) (8) (8) (8) (8)
6.b.1. Food 1,013 1,087 5,413 2,890 2,728 2,123 2,118 2,053 2,053 (22) (3) (3) (3) (3)
6.b.2. Fertilizer 706 811 1,279 1,538 2,513 1,889 1,895 1,640 1,640 (25) (13) (13) (13) (13)
6.b.3. Oil 248 385 385 34 68 122 122 119 119 80 (3) (3) (3) (3)
6.c. Pay, allowances and pensions 4,957 5,366 6,711 5,899 6,564 6,876 6,876 7,171 7,171 5 4 4 4 4
6.c.1.a. Pay and allowances 3,291 3,526 4,626 3,910 4,148 4,495 4,495 4,738 4,738 8 5 5 5 5
6.c.1.b. Pensions 1,666 1,840 2,085 1,989 2,416 2,380 2,380 2,433 2,433 (1) 2 2 2 2
6.d. Agriculture and farmers' welfare 461 942 1,083 1,145 999 1,167 1,083 1,224 1,224 8 5 13 5 13
6.e. Education 781 873 840 803 972 1,297 1,234 1,206 1,206 27 (7) (2) (7) (2)
6.f. Health and family welfare 506 607 740 787 703 749 783 840 840 11 12 7 12 7
6.g. Rural development 1,118 1,221 1,964 1,604 1,768 1,711 1,619 1,776 1,776 (8) 4 10 4 10
6.h. Others 4,457 6,092 5,622 9,255 8,931 8,914 8,572 9,436 8,964 (4) 6 10 1 5
7. Capital expenditure 3,077 3,357 4,263 5,929 7,400 9,502 9,485 11,111 10,327 28 17 17 9 9
7. a. Defence 998 1,160 1,399 1,448 1,509 1,678 1,646 1,822 1,822 9 9 11 9 11
7. b. Railways 528 678 1,093 1,173 1,593 2,400 2,426 2,520 2,684 52 5 4 12 11
7. c. Roads and highways 676 684 892 1,133 2,060 2,645 2,639 2,722 2,899 28 3 3 10 10
7. d. Loans for capex to states — — 118 142 812 1,056 1,129 1,500 1,000 39 42 33 (5) (11)
7. e. Housing and urban affairs 158 193 103 259 269 265 264 285 285 (2) 7 8 7 8
7. f. Others 717 642 657 1,774 1,158 1,459 1,381 2,261 1,636 19 55 64 12 18
8. Total expenditure (6 + 7) 23,151 26,863 35,098 37,938 41,932 44,905 44,425 48,205 46,949 6 7 9 5 6
Deficit
Primary deficit (PD) 668 3,216 11,384 7,790 8,092 6,793 5,898 4,504 3,225 (27) (34) (24) (53) (45)
Revenue deficit (RD) 4,545 6,665 14,496 10,310 10,699 8,405 7,656 5,802 5,007 (28) (31) (24) (40) (35)
Gross fiscal deficit (GFD) 6,494 9,337 18,183 15,845 17,378 17,348 16,537 16,133 14,854 (5) (7) (2) (14) (10)
Gross market borrowing (dated securities) 5,715 7,041 12,601 9,684 14,210 15,430 15,430 14,010 14,010 9 (9) (9) (9) (9)
Net market borrowing (dated securities) 4,233 4,681 10,329 7,041 11,083 11,805 12,193 11,632 11,632 10 (1) (5) (1) (5)
Short-term borrowing (T-bills/WMA) 69 1,560 2,032 774 1,148 13 (4) (500) (1,000)
Nominal GDP 188,997 201,036 198,541 235,974 269,496 295,357 295,357 326,369 326,369 9.6 10.5 10.5 10.5 10.5
PD/GDP (%) 0.4 1.6 5.7 3.3 3.0 2.3 2.0 1.4 1.0
RD/GDP (%) 2.4 3.3 7.3 4.4 4.0 2.8 2.6 1.8 1.5
GFD/GDP (%) 3.4 4.6 9.2 6.7 6.4 5.9 5.6 4.9 4.6
Source: CEIC, Kotak Economics Research estimates
Economy
India Research
31
Kotak Institutional Equities: Valuation summary of KIE Universe stocks

Price (Rs) Fair Value Upside Mkt cap. O/S shares EPS (Rs) P/E (X) P/B (X) EV/EBITDA (X) RoE (%) Dividend yield (%) ADV-3M (US$ mn)
Company Rating 30-Sep-24 (Rs) (%) (Rs bn) (US$ bn) (mn) 2025E 2026E 2027E 2025E 2026E 2027E 2025E 2026E 2027E 2025E 2026E 2027E 2025E 2026E 2027E 2025E 2026E 2027E Traded Delivered
Automobiles & Components
Amara Raja Energy & Mobility SELL 1,426 1,075 (25) 261 3.1 183 59 67 73 24 21 20 3.4 3.0 2.6 15 13 12 15 15 14 0.4 0.5 0.5 18 9
Apollo Tyres SELL 548 410 (25) 348 4.2 638 25 28 30 22 19 18 2.3 2.1 2.0 9 8 7 11 11 11 1.1 1.3 1.3 18 7
Ashok Leyland REDUCE 235 235 (0) 691 8.2 2,936 10 11 12 22 21 19 6.3 5.3 4.7 14 13 12 31 28 26 1.8 1.9 2.6 32 15
Bajaj Auto SELL 12,346 6,800 (45) 3,448 41 279 307 330 374 40 37 33 13.0 12.1 11.3 31 29 26 33 34 35 2.0 2.1 2.4 53 26
Balkrishna Industries SELL 3,050 2,325 (24) 590 7.0 193 82 91 102 37 33 30 5.8 5.1 4.5 23 19 17 17 16 16 0.6 0.6 0.7 11 6
Bharat Forge SELL 1,517 1,070 (29) 706 8.4 466 32 39 46 48 39 33 8.6 7.3 6.2 24 21 19 19 21 21 0.5 0.5 0.6 24 13
CEAT SELL 3,155 2,000 (37) 128 1.5 40 157 162 171 20 20 18 2.8 2.5 2.3 9 9 8 15 14 13 1.3 1.3 1.4 12 4
CIE Automotive SELL 557 530 (5) 211 2.5 378 25 28 31 23 20 18 3.2 2.8 2.5 14 12 11 15 15 15 1.1 1.3 1.4 2 1
Eicher Motors SELL 5,026 3,550 (29) 1,377 16.4 272 165 173 192 30 29 26 7.5 6.5 5.7 26 23 21 26 24 23 1.1 1.2 1.4 35 19
Endurance Technologies SELL 2,400 1,850 (23) 338 4.0 141 57 68 75 42 35 32 6.0 5.3 4.7 22 19 17 14 15 15 0.5 0.6 0.7 4 2
Escorts Kubota SELL 4,269 2,700 (37) 472 5.6 111 105 115 125 41 37 34 4.6 4.2 3.8 35 31 28 11 11 11 0.4 0.4 0.4 14 5
Exide Industries SELL 503 315 (37) 427 5.1 850 15 17 18 34 30 28 3.0 2.8 2.6 20 18 17 9 10 9 0.5 0.5 0.5 24 10
Hero Motocorp SELL 5,712 4,000 (30) 1,142 13.6 200 225 247 270 25 23 21 5.9 5.5 5.1 17 15 14 24 25 25 2.8 3.0 3.3 47 22
Mahindra & Mahindra ADD 3,095 3,050 (1) 3,849 45.9 1,159 98 110 119 31 28 26 5.8 4.9 4.2 24 21 19 20 19 18 0.5 0.5 0.6 106 61
Maruti Suzuki SELL 13,238 11,750 (11) 4,162 49.7 314 461 494 519 29 27 25 4.5 4.1 3.7 19 17 16 16 16 15 1.4 1.5 1.6 98 53
MRF SELL 138,514 97,000 (30) 587 7.0 4 4,710 5,079 5,699 29 27 24 3.2 2.8 2.6 13 12 10 11 11 11 0.2 0.2 0.2 16 5
Samvardhana Motherson ADD 211 185 (12) 1,732 20.7 6,776 6 7 8 33 28 26 4.8 4.2 3.7 16 14 13 16 16 15 0.4 0.5 0.5 55 27
Schaeffler India REDUCE 3,914 4,000 2 612 7.3 156 64 74 86 62 53 45 11.4 10.2 9.1 40 34 30 20 20 21 0.1 0.0 0.0 8 4
SKF ADD 5,436 5,500 1 269 3.2 49 135 153 170 40 35 32 8.8 7.8 6.8 31 26 23 22 22 21 0.9 1.1 1.2 5 3
Sona BLW Precision REDUCE 743 675 (9) 462 5.5 583 12 14 17 63 51 43 13.1 11.0 9.2 40 33 28 22 23 23 0.4 0.5 0.6 17 9
Tata Motors ADD 975 1,250 28 3,733 44.5 3,677 70 83 98 14 12 10 3.3 2.7 2.2 6 5 5 27 25 24 0.7 1.0 1.5 178 83
Timken ADD 3,761 4,000 6 283 3.4 75 62 78 96 61 48 39 9.9 8.3 6.9 42 33 27 18 19 19 0.0 0.0 0.0 5 3
TVS Motor SELL 2,840 1,800 (37) 1,349 16.1 475 53 61 71 54 47 40 17.8 14.0 11.3 33 29 25 33 34 31 0.5 0.5 0.6 32 18
Uno Minda SELL 1,102 970 (12) 633 7.5 572 18 20 22 63 55 49 10.8 9.1 7.8 35 30 27 17 17 16 0.2 0.2 0.3 14 7
Varroc Engineering SELL 587 500 (15) 90 1.1 153 20 29 36 29 20 16 4.9 3.9 3.2 12 9 8 17 20 19 — — — 3 1
Automobiles & Components Cautious 27,898 332.9 29.2 25.8 23.0 5.6 4.8 4.2 15.8 14.0 12.6 19.2 18.8 18.3 1.0 1.1 1.2 831 407
Banks
AU Small Finance Bank ADD 740 675 (9) 550 6.6 743 31 42 54 24 18 14 3.3 2.8 2.3 — — — 16 17 18 — — — 26 11
Axis Bank BUY 1,232 1,500 22 3,812 45.5 3,087 83 95 107 15 13 12 2.3 2.0 1.7 — — — 16 16 16 1.0 1.2 1.3 136 75
Bandhan Bank BUY 199 250 26 320 3.8 1,611 25 28 32 8 7 6 1.4 1.2 1.0 — — — 17 17 17 2.0 2.3 2.6 45 18
Bank of Baroda ADD 248 280 13 1,281 15.3 5,178 30 33 35 8 8 7 1.1 1.0 1.0 — — — 13 13 12 2.4 2.7 2.9 49 23
Canara Bank REDUCE 111 106 (5) 1,010 12.1 9,071 15 17 18 7 7 6 1.3 1.1 1.0 — — — 15 15 14 2.7 3.1 3.2 39 19
City Union Bank ADD 164 165 1 121 1.4 741 14 16 18 11 11 9 1.4 1.3 1.1 — — — 12 12 12 1.4 1.5 1.8 7 3
DCB Bank BUY 123 160 30 38 0.5 313 19 23 31 6 5 4 0.8 0.7 0.6 — — — 11 12 14 1.4 2.1 3.3 3 2
Equitas Small Finance Bank ADD 77 95 23 88 1.0 1,135 6 9 11 13 9 7 1.4 1.3 1.1 — — — 11 14 15 — — — 6 3
Federal Bank BUY 197 225 14 482 5.8 2,435 16 17 21 13 11 9 1.6 1.4 1.3 — — — 12 12 13 1.2 1.3 1.6 30 13
HDFC Bank BUY 1,732 1,850 7 13,213 157.7 7,597 89 107 131 19 16 13 2.7 2.4 2.1 — — — 15 16 17 1.2 1.5 1.8 451 270
ICICI Bank BUY 1,273 1,400 10 8,969 107.0 7,023 60 66 73 21 19 17 3.4 3.0 2.6 — — — 17 16 16 0.9 1.0 1.1 222 119
IndusInd Bank BUY 1,448 1,800 24 1,128 13.5 778 126 135 149 12 11 10 1.6 1.4 1.3 — — — 15 14 14 1.2 1.3 1.5 67 36
Karur Vysya Bank BUY 215 230 7 171 2.0 804 21 23 26 10 9 8 1.6 1.4 1.3 — — — 16 15 16 2.5 2.8 3.2 5 3
Punjab National Bank SELL 107 110 3 1,180 14.1 11,011 14 13 14 8 8 8 1.1 1.0 0.9 — — — 14 12 11 2.6 2.5 2.6 47 18
SBI Cards and Payment Services BUY 774 900 16 736 8.8 951 27 40 56 29 19 14 5.2 4.2 3.3 — — — 19 24 26 0.5 0.6 0.7 19 9
State Bank of India BUY 788 975 24 7,032 83.9 8,925 63 76 93 13 10 8 1.8 1.6 1.4 — — — 14 15 16 1.9 2.0 2.1 161 68
Ujjivan Small Finance Bank ADD 40 55 36 78 0.9 1,931 6 6 7 7 7 5 1.2 1.1 0.9 — — — 18 17 18 3.1 3.5 4.2 9 5
Union Bank ADD 123 155 26 937 11.2 7,634 20 21 21 6 6 6 0.9 0.8 0.8 — — — 15 14 13 3.3 3.4 3.5 19 10
Utkarsh Small Finance Bank BUY 45 60 33 50 0.6 1,099 4 5 7 11 9 6 1.5 1.3 1.1 — — — 14 15 18 — — — 1 1
YES Bank SELL 22 19 (15) 705 8.4 28,768 1 2 2 21 15 10 1.5 1.3 1.2 — — — 7 9 12 — — — 59 22
Banks Attractive 41,902 500.1 14.8 12.9 11.1 2.0 1.8 1.6 13.7 14.1 14.4 1.4 1.5 1.7 1,399 726
Building Products
Astral SELL 1,990 1,800 (10) 534 6.4 269 27 34 41 75 59 49 14.2 11.8 9.8 46 38 32 21 22 22 0.2 0.3 0.3 13 7
Building Products Cautious 534 6.4 74.8 59.1 49.0 14.2 11.8 9.8 45.7 37.7 31.9 18.9 20.0 20 0.2 0.3 0.3 13 7
Source: Company, Bloomberg, Kotak Institutional Equities estimates
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Capital goods
ABB SELL 8,055 6,100 (24) 1,707 20.4 212 86 99 116 94 81 70 22.4 17.8 14.4 75 64 55 27 24 23 0.1 0.1 0.1 30 13
Bharat Electronics SELL 285 200 (30) 2,084 24.9 7,310 6 7 8 46 38 34 11.0 9.4 8.1 34 28 24 26 26 25 0.9 1.0 1.2 119 56
BHEL SELL 280 100 (64) 974 11.6 3,482 (1) 3 10 NM 98 28 4.0 3.8 3.3 NM 46 19 NM 4 12 0.0 (0.1) (0.5) 69 22
Carborundum Universal SELL 1,486 1,320 (11) 283 3.4 190 29 35 41 51 43 36 7.9 6.9 6.0 32 27 23 17 17 18 0.4 0.5 0.6 4 2
CG Power & Industrial SELL 759 415 (45) 1,160 13.8 1,527 7 8 10 113 94 79 30.9 25.0 20.4 82 68 58 27 27 26 (0.3) (0.3) (0.4) 24 12
Cochin Shipyard SELL 1,740 740 (57) 458 5.5 263 28 30 40 62 58 43 8.3 7.6 6.8 48 42 32 14 14 17 0.5 0.6 0.7 86 32
Cummins India ADD 3,806 4,000 5 1,055 12.6 277 71 85 99 54 45 38 15.1 13.3 11.6 51 42 36 30 32 32 1.0 1.2 1.4 34 17
G R Infraprojects SELL 1,693 1,040 (39) 164 2.0 97 70 100 113 24 17 15 2.1 1.9 1.6 16 11 10 9 12 12 0.0 0.0 0.0 2 1
IRB Infrastructure ADD 61 73 20 369 4.4 6,039 2 3 3 29 22 20 2.7 2.6 2.6 13 12 10 9 12 13 3.4 4.0 4.3 31 14
Kalpataru Projects ADD 1,367 1,400 2 222 2.7 160 55 86 109 25 16 13 3.7 3.0 2.5 11 9 7 16 21 22 0.3 0.5 0.7 7 3
KEC International REDUCE 1,039 790 (24) 267 3.2 257 31 46 58 33 22 18 5.6 4.6 3.7 17 13 11 18 22 23 0.3 0.5 0.6 17 7
L&T SELL 3,676 3,380 (8) 5,054 60.3 1,375 112 138 164 33 27 22 6.3 5.4 4.7 22 19 16 21 22 22 0.7 0.9 1.0 113 66
Siemens SELL 7,250 4,600 (37) 2,582 30.8 356 80 93 100 90 78 73 15.0 13.2 11.6 69 59 56 18 18 17 0.3 0.3 0.4 32 16
Thermax REDUCE 5,100 4,600 (10) 608 7.3 113 66 82 99 78 63 51 11.5 10.0 8.6 61 45 36 16 17 18 0.3 0.3 0.3 8 4
Capital goods Cautious 16,986 202.7 51.4 40.6 33.0 8.2 7.2 6.3 32.8 26.6 22.3 16.1 17.9 19.0 0.5 0.6 0.7 573 267
Commercial & Professional Services
SIS REDUCE 416 435 5 60 0.7 147 19 25 30 22 17 14 2.3 2.0 1.7 11 9 8 11 13 14 — — — 1 1
TeamLease Services SELL 3,111 2,920 (6) 52 0.6 17 94 123 160 33 25 19 5.5 4.5 3.7 28 21 16 17.9 19.5 21 — — — 2 1
Commercial & Professional Services Cautious 112 1.3 25.5 19.7 15.7 3.1 2.7 2.3 14.2 11.7 9.8 12.1 13.5 14.5 0.0 0.0 0.0 3 2
Commodity Chemicals
Asian Paints REDUCE 3,329 2,600 (22) 3,193 38.1 959 51 55 59 65 61 56 15.0 13.3 12.0 45 42 39 25 23 22 0.7 0.8 0.9 52 29
Berger Paints SELL 622 475 (24) 725 8.7 1166 10 11 12 62 58 53 11.8 10.5 9.5 39 37 34 20 19 19 0.6 0.7 0.8 12 5
Indigo Paints REDUCE 1,459 1,325 (9) 70 0.8 48 33 35 40 44 42 36 6.7 5.9 5.3 26 24 20 16 15 15 0.3 0.5 0.6 11 6
Kansai Nerolac REDUCE 310 300 (3) 250 3.0 808 9 9 10 35 33 31 4.2 3.9 3.7 22 22 20 12 12 12 1.4 1.5 1.6 4 2
Tata Chemicals SELL 1,091 830 (24) 278 3.3 255 33 37 39 33 30 28 1.2 1.2 1.2 9 8 8 4 4 4 1.4 1.4 1.4 13 5
Commodity Chemicals Cautious 4,516 53.9 57.8 54.2 50.0 7.9 7.3 6.8 34.6 32.6 30.4 13.7 13.5 13.6 0.8 0.9 1.0 92 47
Construction Materials
ACC REDUCE 2,513 2,375 (6) 472 5.6 188 107 131 153 23 19 16 2.6 2.4 2.1 13 10 9 12 13 14 0.9 1.0 1.2 14 6
Ambuja Cements SELL 633 435 (31) 1,558 18.6 2,463 16 20 24 40 31 26 2.9 2.7 2.5 19 15 12 8 9 10 0.3 0.5 0.6 24 12
Dalmia Bharat REDUCE 1,931 1,750 (9) 362 4.3 187 50 66 91 39 29 21 2.1 2.0 1.8 14 12 10 6 7 9 0.4 0.5 0.7 11 6
Grasim Industries REDUCE 2,796 2,415 - 1,882 22.5 675 97 111 132 29 25 21 2.0 1.9 1.7 12 11 9 7 8 9 0.4 0.5 0.5 32 18
J K Cement SELL 4,634 2,700 (42) 358 4.3 77 109 128 153 42 36 30 5.9 5.1 4.5 19 16 14 15 15 16 0.3 0.3 0.3 8 4
Nuvoco Vistas Corp. ADD 359 360 0 128 1.5 357 1 7 10 247 51 36 1.4 1.4 1.3 11 10 - 1 3 4 0.0 0.0 0.0 3 1
Orient Cement SELL 290 200 (31) 59 0.7 205 9 11 12 31 28 25 3.1 2.9 2.6 13 11 10 11 11 11 0.8 0.8 0.8 13 6
Shree Cement SELL 26,309 18,000 (32) 949 11.3 36 415 531 495 63 50 53 4.4 4.1 3.8 21 18 16 7 9 7 0.2 0.3 0.3 16 8
The Ramco Cements SELL 867 580 (33) 205 2.4 236 18 22 28 49 40 31 2.7 2.5 2.4 15 14 13 6 7 8 0.2 0.3 0.3 10 5
UltraTech Cement SELL 11,802 7,000 (41) 3,407 40.7 289 281 324 382 42 36 31 5.2 4.7 4.2 24 21 18 13 14 14 0.7 0.8 0.9 52 29
Construction Materials Cautious 9,382 112.0 38.4 31.8 26.9 3.2 2.9 2.7 16.4 14.2 12.2 8.3 9.3 10.0 0.5 0.6 0.7 183 96
Consumer Durables & Apparel
Aditya Birla Fashion and Retail SELL 349 245 (30) 374 4.5 1,070 (5) (3) (1) NM NM NM 7.4 8.0 8.3 19 15 13 NM NM NM — — — 23 11
Campus Activewear ADD 340 300 (12) 104 1.2 304 4 5 6 77 63 53 13.1 11.3 9.7 39 33 28 19 19 20 — — 0.5 6 3
Cello World ADD 914 975 7 202 2.4 221 17 21 24 53 44 39 9.4 8.2 7.2 34 29 25 23 20 20 0.5 0.7 0.9 2 1
Crompton Greaves Consumer REDUCE 416 425 2 268 3.2 643 9 11 14 45 36 31 8.0 7.0 6.2 30 25 21 19 21 22 1.0 1.2 1.4 21 11
Eureka Forbes BUY 568 700 23 110 1.3 208 7 10 13 79 58 43 2.7 2.6 2.4 44 34 26 3 4 6 — — — 3 2
Havells India SELL 2,013 1,400 (30) 1,262 15.1 628 25 30 36 80 67 56 15.0 13.3 11.6 55 45 37 20 21 22 0.5 0.6 0.7 23 12
Page Industries SELL 42,900 34,000 (21) 479 5.7 11 593 705 824 72 61 52 25.1 21.2 18.0 48 40 34 38 38 37 0.8 0.9 1.2 11 5
Polycab SELL 6,955 4,500 (35) 1,046 12.5 151 126 150 183 55 46 38 10.9 9.3 7.8 38 31 25 21 22 22 0.5 0.5 0.7 49 23
Vedant Fashions REDUCE 1,350 980 (27) 328 3.9 243 19 21 24 72 63 55 17.4 14.7 12.3 42 35 30 26 25 24 — — — 3 2
Voltas SELL 1,845 1,100 (40) 611 7.3 331 28 33 40 65 56 47 9.4 8.4 7.5 48 42 36 15 16 17 0.5 0.5 0.6 35 18
Whirlpool SELL 2,290 1,500 (34) 290 3.5 127 30 40 50 76 57 46 7.4 6.8 6.1 45 34 28 10 12 13 0.3 0.5 0.6 7 4
Consumer Durables & Apparel Cautious 5,110 61.0 77.9 62.3 50.1 10.6 9.5 8.5 39.9 32.9 27.1 13.6 15.3 17.0 0.4 0.5 0.6 186 93
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Consumer Staples
Britannia Industries ADD 6,338 5,800 (8) 1,527 18.2 241 97 111 126 65 57 50 33.8 30.4 27.7 45 40 35 55 56 57 1.4 1.7 1.8 22 12
Colgate-Palmolive (India) REDUCE 3,805 2,875 (24) 1,035 12.3 272 56 62 68 67 61 56 53.9 50.6 47.6 48 43 39 81 86 88 1.4 1.6 1.7 22 13
Dabur India ADD 625 650 4 1,108 13.2 1,772 12 13 15 53 47 41 10.2 9.3 8.4 41 36 31 20 21 22 1.0 1.2 1.3 22 11
Godrej Consumer Products ADD 1,396 1,590 14 1,428 17.0 1,023 22 27 31 63 51 45 10.3 9.3 8.4 42 37 33 17 19 20 0.8 0.9 1.1 23 13
Hindustan Unilever ADD 2,958 2,850 (4) 6,951 82.9 2,350 47 52 57 64 57 52 13.3 12.8 12.3 45 40 37 21 23 24 1.4 1.6 1.7 68 41
Honasa Consumer ADD 459 475 4 149 1.8 322 4 7 10 105 66 47 11.6 9.6 7.8 77 47 33 12 16 18 0.0 0.0 0.0 15 7
ITC ADD 518 535 3 6,481 77.3 12,428 17 19 20 30 28 26 8.6 8.2 7.9 23 21 19 27 29 31 2.8 3.1 3.4 90 50
Jyothy Labs SELL 558 460 (18) 205 2.4 367 11 12 13 50 46 41 10.2 9.1 8.3 38 34 30 21 21 21 1.0 1.1 1.3 7 3
Marico REDUCE 695 625 (10) 900 10.7 1,290 13 14 15 55 50 46 21.8 20.3 18.9 40 36 32 41 42 42 1.5 1.7 1.8 23 12
Nestle India ADD 2,690 2,575 (4) 2,594 31.0 964 35 40 46 77 67 59 54.0 40.9 33.9 52 45 40 83 69 63 0.7 0.9 1.2 31 19
Sula Vineyards ADD 479 570 19 40 0.5 84 11 13 15 43 38 33 6.5 5.8 5.2 23 21 18 16 16 17 0.6 0.8 0.9 2 1
United Breweries ADD 2,170 2,050 (6) 574 6.8 264 22 32 41 101 67 52 12.8 11.7 10.7 60 43 34 13 18 21 0.7 1.1 1.4 8 4
United Spirits ADD 1,590 1,350 (15) 1,156 13.8 727 19 22 26 84 71 62 14.3 12.8 11.4 57 48 43 18 19 19 0.4 0.6 0.7 18 10
Varun Beverages ADD 606 650 7 1,970 23.5 3,248 8 10 13 75 59 47 21.3 16.2 12.5 43 34 29 32 31 30 0.2 0.2 0.3 43 26
Consumer Staples Attractive 27,315 326.0 52.1 46.1 41.3 12.8 11.9 11.1 37.3 32.8 29.3 25 26 27 1.4 1.6 1.8 419 236
Diversified Financials
360 One REDUCE 1,040 1,050 1 379 4.5 355 27 31 37 39 34 28 10.0 9.3 8.5 — — — 27 28 31 1.9 2.1 2.6 10 6
Aadhar Housing Finance BUY 469 550 17 202 2.4 427 22 28 34 21 17 14 3.1 2.6 2.2 — — — 17 17 18 — — — - 4
Aavas Financiers BUY 1,816 2,200 21 144 1.7 79 74 92 112 25 20 16 3.3 2.8 2.4 — — — 14 15 16 — — — 7 4
ABSL AMC ADD 719 750 4 207 2.5 288 29 33 36 25 22 20 5.9 5.3 4.8 — — — NM NM NM 2.4 2.7 3.0 4 2
Aptus Value Housing Finance ADD 358 380 6 179 2.1 499 15 17 20 25 21 18 4.2 3.6 3.2 — — — 18 19 19 1.2 1.4 1.7 3 2
Cholamandalam ADD 1,608 1,500 (7) 1,351 16.1 840 51 62 80 32 26 20 5.7 4.5 3.7 — — — 20 20 20 0.1 0.3 0.4 25 13
Computer Age Management Services REDUCE 4,409 4,200 (5) 217 2.6 49 98 111 129 45 40 34 19.3 15.9 13.3 — — — 47 44 42 1.3 1.5 1.7 25 9
CRISIL SELL 4,663 3,800 (18) 341 4.1 73 98 112 128 48 42 36 17.0 15.1 13.6 — — — 31 32 32 1.4 1.6 1.8 3 1
Five Star Business Finance ADD 780 900 15 228 2.7 291 36 44 53 22 18 15 3.6 3.0 2.5 — — — 18 19 19 — — — 18 10
HDFC AMC REDUCE 4,299 4,000 (7) 918 11.0 213 108 125 141 40 34 30 12.2 11.4 10.6 — — — 32 34 36 2.0 2.3 2.6 28 16
Home First Finance BUY 1,186 1,300 10 106 1.3 89 42 54 69 28 22 17 4.3 3.6 3.1 — — — 16 18 19 — 0.5 0.6 7 3
ICRA REDUCE 7,043 5,200 (26) 68 0.8 10 173 196 221 41 36 32 6.4 6.0 5.7 — — — 16 17 33 — — 0.2 1 0
India Shelter BUY 753 800 6 81 1.0 106 33 39 47 23 19 16 3.0 2.6 2.2 — — — 14 15 15 — — — 3 2
Kfin Technologies REDUCE 1,021 770 (25) 175 2.1 171 19 22 26 54 46 40 13.5 11.8 10.2 — — — 21 21 21 0.7 0.9 1.0 16 7
L&T Finance Holdings SELL 186 155 (17) 463 5.5 2,480 12 15 17 15 13 11 1.8 1.6 1.5 — — — 12 13 14 2.0 2.4 2.7 17 8
LIC Housing Finance BUY 662 800 21 364 4.3 550 86 95 102 8 7 6 1.0 0.9 0.8 — — — 14 14 13 2.1 2.3 2.5 29 12
Mahindra & Mahindra Financial ADD 338 300 (11) 418 5.0 1,234 18 21 25 18 16 13 2.1 1.9 1.7 — — — 12 12 13 1.1 1.2 1.5 12 6
Muthoot Finance ADD 2,032 2,050 1 816 9.7 401 127 152 175 16 13 12 2.9 2.5 2.1 — — — 19 20 20 1.5 1.8 2.0 14 7
Nippon AMC REDUCE 652 700 7 413 4.9 630 21 23 25 31 29 26 10.0 9.6 9.3 — — — 32 34 37 2.9 3.1 3.5 8 4
SBFC ADD 94 95 1 102 1.2 1,107 3 4 5 31 23 18 3.7 3.2 2.7 — — — 12 14 15 — — — 6 3
Shriram Finance BUY 3,577 3,400 (5) 1,345 16.0 376 285 290 344 13 12 10 2.4 2.1 1.8 — — — 17 17 18 1.2 1.2 1.5 51 27
UTI AMC REDUCE 1,239 1,100 (11) 158 1.9 127 51 51 55 24 24 23 3.5 3.4 3.3 — — — 15 14 15 3.3 3.3 3.5 5 2
Diversified Financials Attractive 16,594 198.0 22.6 19.3 15.9 4.3 3.6 3.1 18.9 18.9 19.6 0.8 0.9 1.1 441 227
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Electric Utilities
CESC SELL 201 140 (31) 267 3.2 1,326 13 14 15 16 14 13 2.1 1.9 1.7 8 8 7 14 14 14 2.2 2.4 2.5 24 8
JSW Energy SELL 733 312 (57) 1,281 15.3 1,744 18 21 24 41 35 31 4.5 4.0 3.6 18 16 14 13 12 12 0.3 0.3 0.3 25 12
NHPC SELL 95 68 (29) 954 11.4 10,045 4 6 7 22 16 13 2.3 2.1 2.0 21 11 8 11 14 15 1.9 2.5 3.2 58 24
NTPC SELL 443 300 (32) 4,298 51.3 9,895 22 24 26 20.2 18.4 17 2.5 2.3 2.1 12 10 10 13 13 13 1.7 1.8 1.8 99 53
Power Grid SELL 353 265 (25) 3,282 39.2 9,301 18 20 21 19.4 17.6 17 3.5 3.3 3.0 10 10 9 19 19 19 3.5 3.5 3.7 61 36
Tata Power SELL 483 300 (38) 1,542 18.4 3,196 13 16 17 36 31 28 4.2 3.7 3.3 16 14 13 12 13 12 — — — 81 33
Electric Utilities Cautious 11,623 138.7 22.4 19.8 18.2 3.0 2.7 2.5 12.5 10.9 10.0 13.3 13.8 13.7 1.9 2.0 2.1 348 166
Electronic Manufacturing Services
Amber Enterprises ADD 4,809 4,660 (3) 162 1.9 34 77 109 141 63 44 34 7.0 6.0 5.1 26 21 17 12 15 16 — — — 15 7
Avalon Technologies SELL 581 410 (29) 38 0.5 65 8 12 17 69 49 34 6.3 5.6 4.8 43 28 20 10 12 15 — — — 2 1
Cyient DLM SELL 669 580 (13) 53 0.6 79 14 19 24 46 35 27 5.2 4.5 3.9 31 23 18 11 13 14 — — — 6 3
Dixon Technologies SELL 13,803 7,330 (47) 826 9.9 60 129 173 208 107.2 79.9 66 33.1 23.0 16.8 61 46 38 37 34 29 — — — 92 31
Kaynes Technology ADD 5,426 4,950 (9) 347 4.1 58 51 70 99 106.0 77.8 55 11.2 9.7 8.1 76 52 36 12 15 18 — — — 26 9
Syrma SGS Technology REDUCE 425 420 (1) 75 0.9 176 8 12 16 52 36 26 4.3 3.8 3.3 26 19 14 8 11 13 — — — 4 2
Electronic Manufacturing Services Cautious 1,502 17.9 88.0 64.2 49.8 13.6 11.2 9.2 50.1 37.1 29.0 15.5 17.5 18.4 0.0 0.0 0.0 144 52
Fertilizers & Agricultural Chemicals
Bayer Cropscience SELL 6,412 5,620 (12) 288 3.4 45 180 209 240 36 31 27 9.7 9.3 8.8 27 23 20 28 31 34 2.4 2.8 3.2 4 2
Godrej Agrovet ADD 762 850 12 146 1.7 192 27 32 38 28 24 20 4.7 4.3 3.8 17 14 12 18 19 20 1.8 2.2 2.6 5.7 2.7
Rallis India SELL 331 200 (39) 64 0.8 195 8 10 12 41 33 28 3.3 3.1 2.9 — — — 8 10 11 0.9 1.1 1.2 4 2
UPL SELL 613 400 (35) 460 5.5 751 4 22 35 151 28 17 1.8 1.7 1.6 10 8 7 2 7 10 0.2 0.2 0.2 18 8
Fertilizers & Agricultural Chemicals Cautious 959 11.4 49.3 27.6 20.0 2.9 2.7 2.5 12.0 9.8 8.3 5.9 9.8 12.3 1.1 1.3 1.5 31 14
Gas Utilities
GAIL (India) SELL 240 165 (31) 1,580 18.9 6,575 15 14 14 16 17 17 2.3 2.1 2.0 11 11 11 14 13 12 2.5 2.7 2.9 50 25
Indraprastha Gas SELL 559 370 (34) 391 4.7 700 27 28 29 20 20 19 4.1 3.8 3.5 16 16 15 21 20 19 1.9 2.0 2.1 16 7
Mahanagar Gas SELL 1,940 1,160 (40) 192 2.3 99 104 98 98 19 20 20 3.3 3.0 2.7 12 12 12 19 16 14 1.9 1.8 1.8 19 6
Petronet LNG SELL 342 235 (31) 512 6.1 1,500 30 27 28 11 13 12 2.5 2.2 1.9 8 9 8 24 18 17 1.5 0.7 1.5 18 9
Gas Utilities Cautious 2,915 34.8 16.4 17.2 16.8 2.5 2.3 2.1 11.2 11.7 11.1 15.3 13.4 12.7 2.1 2.1 2.3 126 59
Health Care Services
Apollo Hospitals ADD 7,199 7,300 1 1,035 12.4 144 97 136 191 74 53 38 12.7 10.4 8.3 36 28 21 18 22 22 0.2 0.2 0.2 32 17
Aster DM Healthcare ADD 415 410 (1) 207 2.5 500 8 12 15 49 36 28 4.2 3.9 3.5 23 19 15 9 11 13 0.5 0.5 0.6 7 4
Dr Lal Pathlabs REDUCE 3,298 3,065 (7) 276 3.3 84 51 60 68 65 55 48 13.4 12.1 10.8 38 32 27 22 23 23 0.8 1.0 1.1 10 5
Global Health REDUCE 1,023 1,100 8 275 3.3 268 19 22 25 55 47 42 8.2 7.2 6.3 30 25 22 16 16 16 0.3 0.3 0.4 7 4
KIMS ADD 557 485 (13) 223 2.7 400 8 11 14 68 53 39 10.3 8.6 7.1 31 25 20 16 18 20 0.0 0.0 0.0 3 2
Max Healthcare REDUCE 986 875 (11) 958 11.4 971 16 22 27 62 45 36 8.9 7.5 6.3 41 31 25 16 18 17 0.1 0.1 0.2 21 13
Metropolis Healthcare REDUCE 2,192 1,925 (12) 112 1.3 51 36 47 57 62 47 39 9.1 7.9 7.0 31 26 22 16 18 19 0.3 0.4 0.8 4 1
Narayana Hrudayalaya ADD 1,251 1,380 10 256 3.1 204 41 47 55 31 27 23 6.9 5.5 4.4 20 17 14 25 23 22 — — — 6 4
Rainbow Children's Medicare REDUCE 1,400 1,275 (9) 142 1.7 102 22 29 33 63 49 43 9.8 8.4 7.3 30 24 21 17 19 18 0.3 0.4 0.4 4 2
Health Care Services Neutral 3,484 41.6 59.4 45.6 36.0 9.2 7.8 6.6 33.0 26.2 21.2 15.6 17.2 18.2 0.2 0.3 0.3 94 53
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Hotels & Restaurants
Chalet Hotels ADD 880 900 2 192 2.3 218 18 30 50 49 29 18 6.0 5.0 3.9 25 18 12 16 19 25 (0.2) (0.2) (0.3) 2 1
Devyani International ADD 196 182 (7) 236 2.8 1,204 1 1 2 340 167 110 21.6 20.3 18.6 28 23 20 6 13 18 0.0 0.0 0.0 8 5
Indian Hotels ADD 685 625 (9) 975 11.6 1,423 12 16 19 56 43 35 9.0 7.6 6.5 32 25 20 17 19 20 0.3 0.4 0.4 28 14
Jubilant Foodworks REDUCE 682 540 (21) 450 5.4 660 4 6 7 158 115 94 18.6 16.6 14.7 37 30 26 12 15 17 0.2 0.3 0.4 19 8
Lemon Tree Hotels REDUCE 122 125 2 97 1.2 792 4 5 6 33 26 21 8.6 7.2 5.9 14 12 10 28 30 32 1.1 1.3 1.6 8 4
Restaurant Brands Asia REDUCE 111 110 (1) 55 0.7 495 (1) (0) 0 NM NM 480 3.0 3.1 3.0 18 14 12 NM NM 1 — — — 6 3
Samhi Hotels BUY 201 250 25 44 0.5 220 6 9 13 34 22 16 3.8 3.3 2.8 14 12 10 12 16 19 0.0 0.0 0.0 4
Sapphire Foods BUY 357 360 1 114 1.4 318 1 2 3 279 149 103 8.2 7.8 7.2 22 19 16 3 5 7 — — — 5 3
Westlife Foodworld REDUCE 944 740 (22) 147 1.8 156 2 6 10 382 153 96 23.7 21.1 18.0 41 31 25 6 15 20 — — — 2 1
Hotels & Restaurants Attractive 2,310 27.6 78.6 55.5 41.7 9.7 8.5 7.3 28.2 22.4 18.1 12.4 15.3 17.5 0.2 0.2 0.3 82 39
Insurance
HDFC Life Insurance BUY 718 840 17 1,545 18.4 2,020 8 10 11 85 73 64 10.0 9.4 8.8 — — — 12 13 14 0.3 0.3 0.4 39 21
ICICI Lombard REDUCE 2,174 1,550 (29) 1,076 12.8 493 53 63 75 41 35 29 7.6 6.4 5.4 — — — 20 20 20 0.4 0.4 0.5 22 13
ICICI Prudential Life BUY 780 850 9 1,127 13.4 1,441 6 7 8 122 108 99 9.8 9.1 8.5 — — — 8 9 9 0.4 0.4 0.4 15 7
LIC BUY 1,007 1,300 29 6,369 76.0 6,325 67 70 72 15 14 14 5.6 4.3 3.5 — — — 43 34 28 — — — 41 17
Max Financial Services BUY 1,191 1,225 3 411 4.9 345 2 2 3 639 556 475 — — — — — — 1 1 1 — — — 17 9
PB Fintech REDUCE 1,620 1,400 (14) 739 8.8 455 6 12 21 276 131 77 — — — 4 9 13 — — — 36 20
SBI Life Insurance BUY 1,844 1,900 3 1,848 22.0 1,005 20 23 23 92 81 79 11.4 10.2 9.2 — — — 13 13 12 0.2 0.2 0.2 31 17
Star Health and Allied Insurance ADD 607 650 7 355 4.2 585 18 22 28 33 27 22 4.8 4.1 3.4 — — — 16 16 17 — — — 9 6
Insurance Attractive 13,470 160.7 26.4 24.7 23.3 7.0 5.8 4.8 27 23 21 0.1 0.1 0.1 210 110
Internet Software & Services
Cartrade Tech SELL 964 575 (40) 46 0.5 51.5 14 16 19 70 60 52 2.3 2.2 2.1 42 34 29 3.4 3.8 4.2 — — — 4 2
FSN E-commerce Ventures SELL 196 190 (3) 559 6.7 2,875.0 1 1 2 364 144 86 39.7 31.1 22.9 108 65 44 11.5 24 31 — — — 36 16
Indiamart SELL 2,952 2,530 (14) 177 2.1 59.9 75 87 100 40 34 29 8.4 7.1 5.9 32 26 22 23 23 22 0.7 0.7 0.7 11 4
Info Edge ADD 8,101 7,700 (5) 1,050 12.5 129.1 77 93 110 105 87 73 4.0 3.9 3.7 90 74 62 3.9 4.5 5.2 0.2 0.3 0.3 23 11
Just Dial BUY 1,155 1,240 7 98 1.2 85.0 65 67 73 18 17 16 2.1 1.9 1.7 14 11 8 12.8 11.7 11.4 — — — 11 4
Zomato BUY 273 315 15 2,414 28.8 9,131 2 4 4 147 76 67 10.9 9.3 8.0 228 89 48 7.9 13.2 12.9 0.0 0.0 0.0 207 93
Internet Software & Services Attractive 4,344 51.8 111 72 61 7.3 6.6 6.0 115 70 46 6.6 9.2 9.8 0.1 0.1 0.1 293 131
IT Services
Coforge ADD 7,016 7,200 3 468 5.6 67 141 190 240 50 37 29 7.9 7.3 6.6 26 19 16 20 21 24 1.3 1.7 1.9 38 14
Cyient BUY 1,881 2,050 9 209 2.5 111 66 79 88 29 24 21 4.2 3.9 3.6 16 13 12 15 17 18 2.1 2.6 3.2 14 8
HCL Technologies REDUCE 1,796 1,740 (3) 4,874 58.2 2,716 62 69 77 29 26 23 7.0 6.6 6.2 18 17 15 24 26 27 3.1 3.2 3.3 63 37
Infosys BUY 1,876 2,050 9 7,788 92.9 4,146 63 72 79 30 26 24 8.2 7.6 7.3 19 17 15 29 30 31 2.5 2.9 3.6 161 103
KPIT Technologies SELL 1,628 1,150 (29) 446 5.3 273 28 37 45 57 44 36 15.9 12.6 10.1 35 27 22 31 32 31 0.6 0.7 0.9 24 11
L&T Technology Services SELL 5,344 4,400 (18) 566 6.7 106 129 147 169 41 36 32 9.3 8.1 7.1 27 24 21 24 24 24 0.9 1.0 1.2 11 4
LTIMindtree ADD 6,244 6,200 (1) 1,849 22.1 296 168 206 229 37 30 27 8.2 7.1 6.2 25 21 19 23 25 24 1.3 1.4 1.8 45 21
Mphasis SELL 3,010 2,750 (9) 569 6.8 189 90 102 123 34 29 24 6.1 5.8 5.2 22 19 16 19 20 22 2.2 2.3 2.3 31 14
Persistent Systems SELL 5,450 4,140 (24) 849 10.1 155 84 107 127 65 51 43 14.6 12.3 10.4 43 34 28 24 26 26 0.5 0.7 0.8 32 13
RateGain ADD 733 840 15 86 1.0 119 18 23 29 41 32 26 5.2 4.4 3.8 33 24 19 13 15 16 — — — 4 2
Tata Elxsi SELL 7,724 5,500 (29) 481 5.7 62 137 163 189 56 47 41 17.1 15.0 13.1 39 33 29 32 34 34 1.1 1.3 1.5 33 15
Tata Technologies SELL 1,103 650 (41) 448 5.3 406 18 22 25 63 51 44 12.5 11.1 9.9 43 35 30 21 23 24 0.8 1.0 1.1 43 23
TCS ADD 4,269 4,500 5 15,444 184.3 3,619 142 156 172 30 27 25 15.0 13.5 12.2 21 19 17 53 52 52 2.7 2.9 3.2 136 84
Tech Mahindra REDUCE 1,577 1,400 (11) 1,392 16.6 890 48 62 79 33 25 20 5.2 5.0 4.7 19 15 12 16 20 24 2.4 2.5 3.3 41 22
Wipro SELL 541 460 (15) 2,832 33.8 5,234 23 25 28 23 22 20 3.3 3.0 2.8 14 13 12 15 15 15 0.2 2.2 2.8 58 25
IT Services Neutral 38,302 457.1 30.8 27.3 24.4 8.6 7.9 7.3 20.4 18.2 16.2 27.9 28.9 29.7 2.2 2.6 3.0 733 381
Media
PVR INOX ADD 1,664 1,480 (11) 163 1.9 98 14 43 56 117 39 30 1.9 1.8 1.7 23 15 13 2 5 6 0.1 0.3 0.3 11 4
Sun TV Network SELL 833 830 (0) 328 3.9 394 49 55 59 17 15 14 2.8 2.5 2.3 12 10 9 17 18 17 2.3 2.6 2.9 11 4
Zee Entertainment Enterprises REDUCE 138 160 16 132 1.6 960 9 10 11 16 13 12 1.2 1.1 1.1 9 7 7 7 9 9 2.9 3.3 3.6 33 15
Media Neutral 624 7.4 21.5 17.4 15.7 2.0 1.8 1.7 13.0 10.4 9.3 9.2 10.6 11.0 1.9 2.1 2.4 56 23
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Metals & Mining
Gravita India ADD 2,453 2,800 14 169 2.0 69 46 62 77 54 40 32 15.3 11.5 9.1 39.5 30.1 24.4 32 33 32 0.3 0.4 0.8 13 5
Hindalco Industries REDUCE 756 650 (14) 1,699 20.3 2,220 54 55 58 14 14 13 1.4 1.3 1.2 7.1 6.7 6.3 11 10 10 0.7 0.7 0.8 53 26
Hindustan Zinc SELL 523 365 (30) 2,208 26.3 4,225 24 24 24 22 21 21 14.5 14.5 14.5 13.0 12.5 12.2 66 68 68 4.6 4.7 4.7 19 11
Jindal Steel and Power BUY 1,040 1,165 12 1,061 12.7 1,020 50 81 116 21 13 9 2.2 1.9 1.6 10.8 7.6 5.4 11 16 19 0.2 0.4 0.6 25 13
JSW Steel REDUCE 1,030 900 (13) 2,519 30.1 2,445 44 74 93 23 14 11 2.9 2.5 2.1 10.8 8.1 6.6 13 19 20 0.6 1.1 1.3 25 11
National Aluminium Co. ADD 210 235 12 386 4.6 1,837 20 19 20 11 11 10 2.3 2.1 1.8 6.5 6.7 5.8 23 19 19 3.7 3.5 3.9 36 14
NMDC SELL 245 220 (10) 718 8.6 2,931 23 24 23 11 10 11 2.4 2.1 1.9 7.3 6.9 7.1 24 22 19 3.8 3.9 3.7 30 13
SAIL SELL 141 65 (54) 584 7.0 4,130 5 5 5 26 26 28 1.0 1.0 0.9 9.0 9.1 9.4 4 4 3 1.2 1.2 1.1 47 16
Tata Steel REDUCE 169 150 (11) 2,104 25.1 12,486 8 13 15 22 13 11 2.1 1.9 1.7 8.8 6.9 6.4 10 16 16 1.6 2.0 2.3 89 39
Vedanta SELL 513 390 (24) 2,005 23.9 3,717 31 41 44 17 12 12 4.5 4.0 3.6 6.3 5.3 5.0 32 34 33 4.5 5.4 5.6 90 41
Metals & Mining Cautious 13,453 160.5 18.7 14.3 12.7 2.6 2.3 2.1 8.8 7.4 6.7 14.0 16.3 16.4 2.2 2.5 2.7 427 184
Oil, Gas & Consumable Fuels
BPCL SELL 370 265 (28) 1,605 19.2 4,259 24 29 28 15 13 13 1.9 1.8 1.6 8.6 7.5 7.7 13 14 13 2.2 2.6 2.6 61 27
Coal India SELL 510 410 (20) 3,144 37.5 6,163 49 53 56 10 10 9 3.2 2.7 2.3 9.2 8.0 7.4 34 31 27 4.9 4.9 4.9 66 32
HPCL SELL 441 190 (57) 937 11.2 2,128 21 34 33 21 13 13 2.1 1.9 1.7 13.4 10.0 10.0 11 15 14 1.4 2.3 2.2 50 22
IOCL SELL 180 110 (39) 2,544 30.4 14,121 13 16 15 14 11 12 1.4 1.3 1.2 7.5 6.6 6.6 10 11 10 3.1 3.6 3.5 51 24
Oil India SELL 581 350 (40) 944 11.3 1,627 45 48 47 13 12 12 1.9 1.7 1.6 9.2 8.4 8.2 16 15 14 2.5 2.9 2.9 77 30
ONGC REDUCE 298 280 (6) 3,744 44.7 12,580 42 46 44 7 6 7 1.0 0.9 0.8 4.4 3.7 3.9 15 15 13 4.3 4.4 3.9 96 41
Reliance Industries ADD 2,953 3,200 8 19,982 238.5 6,766 113 130 149 26 23 20 2.3 2.1 1.9 12.7 10.8 9.1 9 10 10 — 0.4 0.4 238 138
Oil, Gas & Consumable Fuels Neutral 32,901 392.6 16.4 14.4 13.8 1.9 1.8 1.6 9.4 8.1 7.4 11.8 12.2 11.6 1.6 1.8 1.7 638 313
Pharmaceuticals
Aurobindo Pharma SELL 1,461 1,270 (13) 848 10.1 586 67 77 82 22 19 18 2.7 2.4 2.2 12 11 10 13 13 13 1.2 1.5 1.8 26 13
Biocon REDUCE 363 320 (12) 436 5.2 1,202 1 10 14 271 36 27 1.7 1.6 1.5 16 12 10 1 5 6 1.0 1.0 1.3 23 9
Blue Jet Healthcare ADD 508 540 6 88 1.1 173 12 17 21 42 30 24 8.5 6.7 5.4 30 21 16 22 25 25 0.2 0.2 0.3 2 1
Cipla ADD 1,654 1,815 10 1,336 15.9 806 60 67 67 28 25 25 4.4 3.9 3.4 18 16 15 17 17 14 0.8 0.9 0.9 31 17
Concord Biotech REDUCE 2,033 1,950 (4) 213 2.5 105 35 47 60 57 43 34 11.8 9.8 8.0 41 31 25 22 25 24 0.4 0.6 0.7 6 3
Divis Laboratories SELL 5,443 3,600 (34) 1,445 17.2 265 80 101 124 68 54 44 9.8 8.9 7.9 48 38 31 15 17 19 0.7 0.8 1.0 40 21
Dr Reddy's Laboratories REDUCE 6,752 6,830 1 1,127 13.4 166 359 363 314 19 19 22 3.4 2.9 2.6 12 11 12 19 17 12 0.7 0.7 0.8 36 20
Emcure Pharmaceuticals ADD 1,469 1,655 13 278 3.3 189 39 50 60 37 29 24 6.4 5.5 4.7 18 15 13 20 20 21 0.7 0.9 1.0 -
Gland Pharma SELL 1,793 1,460 (19) 295 3.5 164 51 64 75 35 28 24 3.2 3.0 2.8 21 17 14 9 11 12 1.3 1.4 1.6 9 5
Glenmark Life Sciences REDUCE 1,057 1,265 20 130 1.5 123 42 49 56 25 22 19 5.0 4.5 4.0 17 15 13 21 22 21 2.2 2.3 2.4 4 2
JB Chemicals & Pharma BUY 1,875 2,255 20 291 3.5 157 44 55 63 43 34 30 8.5 7.1 5.9 27 22 19 22 23 20 0.6 0.6 0.6 5 2
Laurus Labs SELL 464 330 (29) 250 3.0 536 6 10 13 77 45 35 5.6 5.0 4.4 26 19 16 8 12 12 - - - 15 7
Lupin ADD 2,191 2,385 9 999 11.9 455 63 84 80 35 26 27 6.0 5.0 4.4 20 15 15 18 21 16 0.5 0.7 0.6 38 20
Mankind Pharma ADD 2,521 2,585 3 1,010 12.1 401 56 68 80 45 37 31 9.2 7.7 6.5 33 28 23 22 22 23 0.6 0.7 0.8 20 12
Sun Pharmaceuticals ADD 1,927 1,955 1 4,623 55.2 2,399 48 57 65 40 34 30 6.3 5.5 4.8 29 24 22 17 18 17 0.5 0.6 0.7 44 27
Torrent Pharmaceuticals REDUCE 3,397 3,215 (5) 1,149 13.7 338 59 76 93 57 45 37 13.8 11.1 9.0 30 25 22 26 28 27 0.4 0.5 0.6 12 7
Pharmaceuticals Neutral 14,518 173.3 37.0 30.6 28.0 5.3 4.7 4.2 22.7 19.1 17.5 14.5 15.4 14.8 0.5 0.6 0.7 312 166
Real Estate
Brigade Enterprises ADD 1,417 1,320 (7) 346 4.1 231 27 36 52 52 39 27 7.8 6.6 5.4 23 18 13 16 18 22 0.2 0.2 0.2 7 4
Brookfield India Real Estate Trust ADD 285 290 2 137 1.6 439 8 12 15 38 24 19 1.3 1.4 1.4 14 12 11 2 4 6 6.9 7.6 8.2 1 1
DLF ADD 895 960 7 2,216 26.4 2,475 14 22 31 62 40 29 5.3 4.9 4.3 100 49 37 9 13 16 0.7 0.8 0.9 35 15
Embassy Office Parks REIT RS 390 - (100) 370 4.4 948 10 13 17 37 31 23 1.7 1.8 1.8 16 14 12 4 6 8 5.8 6.1 6.9 5 4
Godrej Properties SELL 3,161 2,035 (36) 879 10.5 278 48 48 98 66 65 32 7.8 6.9 5.7 2,360 335 58 13 11 19 — — — 31 14
Macrotech Developers ADD 1,234 1,450 17 1,229 14.7 995 29 41 43 43 30 29 6.0 5.0 4.3 29 21 19 15 18 16 — — — 20 11
Mindspace REIT ADD 357 395 11 212 2.5 593 11 13 17 32 27 21 1.5 1.5 1.6 14 13 11 5 6 8 6.1 6.6 7.2 1 1
Nexus Select Trust ADD 145 162 12 220 2.6 1,515 4 5 6 33 28 24 1.5 1.6 1.7 16 15 14 5 6 7 5.9 6.5 7.1 10 9
Oberoi Realty REDUCE 1,892 1,550 (18) 688 8.2 364 54 100 126 35 19 15 4.4 3.5 2.9 24 13 10 13 21 21 0.5 0.6 0.7 18 9
Prestige Estates Projects ADD 1,845 1,830 (1) 795 9.5 401 16 24 76 115 76 24 6.2 5.8 4.7 32 26 13 6 8 21 0.1 0.1 0.2 36 19
Signature Global ADD 1,598 1,555 (3) 225 2.7 141 37 81 160 43 20 10 19.5 9.8 4.9 41 15 8 59 66 66 — — — 15 4
Sobha SELL 1,940 1,480 (24) 197 2.4 107 18 35 52 105 56 38 4.4 4.2 3.8 41 24 15 5 8 11 0.2 0.2 0.3 7 3
Sunteck Realty BUY 581 685 18 85 1.0 140 20 37 51 29 16 11 2.4 2.1 1.8 21 11 8 9 14 17 0.2 0.2 0.2 6 3
Real Estate Attractive 8,256 98.5 52.1 35.5 25.3 4.5 4.1 3.7 32.8 23.0 16.9 8.5 11.6 14.6 0.9 1.0 1.1 208 105
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Retailing
Avenue Supermarts SELL 5,096 3,850 (24) 3,316 39.6 651 49 60 72 104 85 71 15.1 12.9 10.9 65 53 45 16 16 17 — — — 30 18
Metro Brands REDUCE 1,275 1,150 (10) 347 4.1 272 14 18 22 89 71 58 16.4 14.1 12.0 43 35 30 20 21 22 — 1— 0.6 3 1
Titan Company REDUCE 3,824 3,175 (17) 3,395 40.5 888 44 53 63 88 72 61 29.5 23.0 18.2 56 48 41 37 36 33 0.4 0.4 0.5 62 32
Trent ADD 7,575 6,615 (13) 2,693 32.1 356 57 81 112 133 94 67 44.5 30.2 20.9 90 65 47 40 38 37 — — — 82 44
Retailing Neutral 7,058 116.4 102.8 81.6 65.7 23.4 18.8 15.0 65.2 52.9 43.3 23 23 23 0.1 0.2 0.2 177 95
Specialty Chemicals
Aarti Industries SELL 583 470 (19) 211 2.5 363 14 19 24 40 30 24 3.7 3.3 3.0 20 16 14 9 12 13 0.3 0.5 0.6 16 6
Atul SELL 7,690 4,530 (41) 226 2.7 29 174 208 245 44 37 31 4.1 3.8 3.4 23 20 17 10 11 11 0.4 0.5 0.6 8 4
Castrol India SELL 246 185 (25) 243 2.9 989 10 11 11 25 23 22 10.6 9.8 9.0 18 16 15 43 44 43 3.3 3.5 3.7 35 11
Clean Science & Technology ADD 1,577 1,610 2 168 2.0 106 32 42 59 49 38 27 11.4 9.2 7.3 36 28 20 26 27 30 0.5 0.6 0.8 5 2
Deepak Nitrite SELL 2,907 2,310 (21) 397 4.7 136 65 80 93 44 37 31 7.1 6.0 5.1 32 27 23 17 18 18 0.2 0.3 0.3 16 6
Navin Fluorine REDUCE 3,441 3,490 1 171 2.0 50 55 93 140 63 37 25 6.5 5.7 4.8 38 24 17 11 16 21 0.3 0.4 0.6 9 4
Neogen Chemicals BUY 2,067 2,000 (3) 55 0.7 26 27 50 61 77 41 34 6.6 5.8 5.1 39 25 15 9 15 16 0.2 0.3 0.4 4 2
Pidilite Industries ADD 3,359 3,225 (4) 1,709 20.4 509 43 49 56 79 68 60 18.1 16.3 14.9 54 47 42 24 25 26 0.7 0.9 1.1 15 8
PI Industries REDUCE 4,656 4,160 (11) 706 8.4 152 113 129 149 41 36 31 6.9 6.0 5.1 29 25 22 18 18 18 0.3 0.4 0.5 18 10
S H Kelkar and Company BUY 299 400 34 41 0.5 138 13 15 19 24 20 16 3.1 2.7 2.4 12 11 9 14 15 16 1.0 1.0 1.2 4 2
SRF ADD 2,498 2,420 (3) 740 8.8 296 54 79 98 46 32 26 5.8 5.0 4.3 25 19 16 13 17 18 0.5 0.5 0.6 20 11
Vinati Organics SELL 2,086 1,160 (44) 216 2.6 104 37 46 57 56 45 37 7.8 6.8 5.9 37 30 25 15 16 17 0.3 0.3 0.4 2 1
Specialty Chemicals Neutral 4,883 58.3 50.8 40.8 34.1 8.1 7.1 6.2 31.8 26.2 22.2 15.9 17.4 18.1 0.6 0.8 0.9 150 67
Telecommunication Services
Bharti Airtel ADD 1,710 1,580 (8) 10,247 122.3 5,753 42 53 68 41 32 25 10.7 8.5 7.4 13 10 8 28 30 31 0.9 1.3 1.6 131 81
Indus Towers SELL 393 370 (6) 1,036 12.4 2,638 33 30 23 12 13 17 3.1 2.6 2.5 5 5 6 29 21 15 0.5 5.1 2.5 87 45
Vodafone Idea SELL 10 10 (3) 722 8.6 69,645 (4) (3) (3) NM NM NM NM NM NM 16 15 13 NM NM NM — — — 129 52
Tata Communications SELL 2,135 1,625 (24) 608 7.3 285 47 67 86 46 32 25 22.4 14.9 10.6 14 12 11 59 56 50 0.9 1.2 1.6 13 6
Telecommunication Services Attractive 12,613 150.5 176.2 79.6 51.3 68 31 24 12.1 10.3 8.9 39 39 46 0.8 1.5 1.6 360 184
Transportation
Adani Ports and SEZ BUY 1,448 1,710 18 3,128 37.3 2,160 54 63 71 27 23 20 5.0 4.2 3.6 19 16 13 20 20 19 0.5 0.6 0.6 52 22
Container Corp. SELL 918 710 (23) 560 6.7 609 22 26 31 41 35 30 4.5 4.2 4.0 25 21 18 11 13 14 1.1 1.3 1.5 26 14
Delhivery BUY 425 560 32 315 3.8 747 4 6 10 109 75 43 3.3 3.1 2.9 61 35 22 3 4 7 — — — 17 11
Gateway Distriparks ADD 91 105 15 46 0.5 500 4 6 7 21 17 14 2.2 2.0 1.9 14 11 9 11 13 14 2.0 2.2 2.5 1 1
GMR Airports SELL 94 74 (21) 993 11.9 6,036 (2) 1 1 NM 153 72 NM NM NM 36 21 19 715 NM 587 — — — 32 15
Gujarat Pipavav Port SELL 220 175 (20) 106 1.3 483 9 10 12 25 21 18 4.2 3.5 2.9 16 13 10 18 18 17 — — — 14 5
InterGlobe Aviation BUY 4,787 5,400 13 1,849 22.1 383 219 230 296 22 21 16 17.7 9.5 4.5 8 6 4 135 60 46 — — — 89 54
JSW Infrastructure SELL 345 215 (38) 725 8.6 2,119 7 9 9 49 40 37 8.0 6.9 22.9 32 28 23 17 18 17 0.4 0.5 0.5 12 6
Mahindra Logistics SELL 483 340 (30) 35 0.4 71 3 13 22 188 37 22 6.8 5.9 4.8 14 10 8 4 17 25 — — — 1 1
Transportation Attractive 7,756 92.6 34.0 28.1 23.4 7.1 5.8 4.7 17.0 13.6 11.2 21 21 20 0.3 0.4 0.4 245 129
KIE universe 334,013 3,986 27.4 23.4 20.6 4.2 3.7 3.3 16.8 14.4 12.9 15.2 15.9 16.1 1.2 1.3 1.5
Notes:
(a) We have used adjusted book values for banking companies.
(b) 2024 means calendar year 2023, similarly for 2025 and 2026 for these particular companies.
(c) Exchange rate (Rs/US$)= 83.8
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DISCLAIMERS, DISCLOSURES & LEGAL

Distribution of ratings/investment banking relationships
Kotak Institutional Equities Research coverage universe
Percentage of companies covered by Kotak Institutional

70%
Equities, within the specified category.
60%
Percentage of companies within each category for which
50% Kotak Institutional Equities and or its affiliates has
provided investment banking services within the previous
12 months.
40%
34.9% * The above categories are defined as follows: Buy = We
31.6% expect this stock to deliver more than 15% returns over
30% the next 12 months; Add = We expect this stock to deliver
5-15% returns over the next 12 months; Reduce = We
18.8% expect this stock to deliver -5-+5% returns over the next
20%
14.7% 12 months; Sell = We expect this stock to deliver less than
-5% returns over the next 12 months. Our target prices
8.5%
10% are also on a 12-month horizon basis. These ratings are
2.9% 1.8% used illustratively to comply with applicable regulations. As
1.1%
of 30/06/2024 Kotak Institutional Equities Investment
0%
BUY ADD REDUCE SELL Research had investment ratings on 272 equity securities.
Source: Kotak Institutional Equities

As of June 30, 2024
Ratings and other definitions/identifiers

Definitions of ratings
BUY. We expect this stock to deliver more than 15% returns over the next 12 months.
ADD. We expect this stock to deliver 5-15% returns over the next 12 months.
REDUCE. We expect this stock to deliver -5-+5% returns over the next 12 months.
SELL. We expect this stock to deliver <-5% returns over the next 12 months.
Our Fair Value estimates are also on a 12-month horizon basis.Our Ratings System does not take into account short-term volatility in stock prices related
to movements in the market. Hence, a particular Rating may not strictly be in accordance with the Rating System at all times.
Other definitions
Coverage view. The coverage view represents each analyst’s overall fundamental outlook on the Sector. The coverage view will consist of one of the
following designations: Attractive, Neutral, Cautious.
Other ratings/identifiers
NR = Not Rated. The investment rating and fair value, if any, have been suspended temporarily. Such suspension is in compliance with applicable
regulation(s) and/or Kotak Securities policies in circumstances when Kotak Securities or its affiliates is acting in an advisory capacity in a merger or
strategic transaction involving this company and in certain other circumstances.
CS = Coverage Suspended. Kotak Securities has suspended coverage of this company.
NC = Not Covered. Kotak Securities does not cover this company.
RS = Rating Suspended. Kotak Securities Research has suspended the investment rating and fair value, if any, for this stock, because there is not a
sufficient fundamental basis for determining an investment rating or fair value. The previous investment rating and fair value, if any, are no longer in
effect for this stock and should not be relied upon.
NA = Not Available or Not Applicable. The information is not available for display or is not applicable.
NM = Not Meaningful. The information is not meaningful and is therefore excluded.
India Research
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India Daily

October 01, 2024 NIFTY50 [Sep 30]: 25,811

Private Circulation Only.

National Aluminium Co. (NACL) ADD

Sumangal Nevatia Siddharth Mehrotra

Australian alumina (LHS) LME aluminium (RHS)

Alumina—supply disruptions impact market balance

Bauxite—tight, concentrated markets

National Aluminium Co.

Aluminum—smelters stock up alumina to mitigate tail risk events

Alumina prices are at 20%+ of LME aluminum prices, as of September 2024

Source: Bloomberg, Kotak Institutional Equities estimates

National Aluminium Co.

FCF to remain positive, despite growth capex over FY2025-27E

50 46 Capital expenditure (Rs mn) Free cash flow (Rs mn)

(30) (24) (24) (24)

Source: Company, Kotak Institutional Equities estimates

Strong earnings to help maintain 3-4% dividend yield over FY2025-27E

Net cash per share (LHS) Dividend Yield (%) (RHS)

Source: Company, Kotak Institutional Equities estimates

National Aluminium Co.

Source: Company, Kotak Institutional Equities estimates

Exhibit 9: NACL, key assumptions, March fiscal year-ends, 2019-27E

Source: Company, Kotak Institutional Equities estimates

Source: Company, Kotak Institutional Equities estimates

National Aluminium Co.

2.50% 1.4% 1.3%

Source: Company, Kotak Institutional Equities estimates

National Aluminium Co.

Source: Company, Kotak Institutional Equities estimates

National Aluminium Co.

Cyient (CYL) BUY

Management perspectives on semiconductor initiatives Company data and valuation summary

Kawaljeet Saluja Vamshi Krishna Sathishkumar S

Exhibit 1: Cyient SoTP valuation

Source: Kotak Institutional Equities

Source: Company, Kotak Institutional Equities estimates

Source: Company, Kotak Institutional Equities estimates

portfolios based on single factors and a multifactor version of the same.

Momentum against Low Vol, winner takes all! 0.97

cuts by the Fed. While all of the broad-based single-factor portfolios

All-season portfolio—a bumpy ride followed by take-off!

What’s in for October 2024?

Full sector coverage on KINSITE

Bhavik Bochar, CFA

The Alphabet Suite of Factor Portfolios

Alphabet portfolios outperform Nifty 50 benchmark across investment horizons

Source: Kotak Institutional Equities, FactSet

Cumulative performance since January 2004 Performance in last month

Broad Concentrated Nifty 50 Broad Concentrated Nifty 50

Sector exposure Avg. information coefficient decay profile over 12M

Utilities Sep-24 0.08

Technology Oct-24 0.07

All-season portfolio constituents for October 2024

Source: Kotak Institutional Equities, FactSet

Cumulative performance since January 2004 Performance in last month

64.0 Broad Concentrated Nifty 50 1.05 Broad Concentrated Nifty 50

Sector exposure Avg. information coefficient decay profile over 12M

Fundamental portfolio constituents for October 2024

Source: Kotak Institutional Equities, FactSet