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Niket Shah (Niket.Shah@MotilalOswal.

com); +91 22 3982 5426


Atul Mehra (Atul.Mehra@MotilalOswal.com); +91 22 3982 5417


10 June 2014

Update | Sector: Textiles
Arvind
CMP: INR203 TP: INR270 Buy

Entering next growth orbit
Brands business to be scaled up aggressively, e-commerce launch soon
We met Arvinds management for a perspective on the demand scenario in the
industry and growth prospects, going forward. Key takeaways are:

Brands and Retail business to be aggressively scaled up
Management is focused on scaling up the Brands and Retail business
aggressively over the next three to five years. Among a trade-off between scale
and margins, management will choose scale as this will increase ARVNDs
overall profit pool. While brands will witness incremental store additions largely
through the franchise route, retail will see store additions through the owned
model route. This has been strategically planned as there will always be limited
capital to deploy and growth has to be maximized within that pool of capital
and finite time period.

Power Brands growth robust; growth brands to be future drivers
Power Brands like Arrow, Tommy, US POLO and Flying Machine will continue
to witness more than 25% growth. Management will invest aggressively in what
are internally identified Growth brands brands which are presently small but
have high potential for growth and can be Power Brands over the next three
years. These include Nautica, Hanes, Gant, Calvin Klein.

E-commerce foray to be next big event
ARVND is working on a unique e-commerce platform, which will be launched
under a new brand and will offer differentiated products. For example,
customization will be a major differentiator. Online consumers will be able to
choose the color, fabric type, style and have messages written on a t-shirt or
any other garment they buy. These differentiators will be first of the kind for
Indian consumers. Also, company plans to have retail kiosks which will be a
unique brand concept.

MegaMart restructuring to be completed by 1HFY15
ARVND is working on a massive restructuring strategy for MegaMart (MM)
stores. The plan is to move from old format stores to newer ones. New format
stores will be larger typically 10,000sqft plus. Company has three 50,000sqft
stores in MM. It has reduced the store count for MM from 216 to 166 over the
past couple of years due to restructuring. However, retail space in MM has
expanded during this period from 0.69msf to 0.75msf implying significant (40%)
increase in sqft/store from 3,200sqft/store to 4,500sqft/store. MMs
restructuring will be completed by September 2014.


BSE Sensex S&P CNX
25,584 7,656

Stock Info
Bloomberg ARVND IN
Equity Shares (m) 258.2
52-Week Range (INR) 210/65
1, 6, 12 Rel. Per (%) -6/45/105
M.Cap. (INR b) 52.4
M.Cap. (USD b) 0.9


Financial Snapshot (INR Million)
Y/E March 2014 2015E 2016E
Net Sales 68,621 83,359 100,436
EBITDA 9,340 11,670 14,503
Adj PAT 3,539 4,688 6,101
EPS (INR) 13.7 18.2 23.6
Growth (%) 42.5 32.5 30.1
BV/Sh (INR) 100.1 114.8 133.7
RoE (%) 14.6 16.9 19.0
RoCE (%) 15.1 16.3 18.5
P/E (x) 14.6 11.0 8.5
P/BV (x) 2.0 1.7 1.5


Shareholding pattern (% )
As on Mar-14 Dec-13 Mar-13
Promoter 43.8 43.8 43.9
Domestic Inst 14.2 18.2 18.9
Foreign 23.5 19.9 17.4
Others 18.5 18.1 19.7


Stock Performance (1-year)


Investors are advised to refer through disclosures made at the end of the Research Report.

Arvind
10 June 2014 2
Significant room to expand RoCE in textile business
Management believes that contrary to popular perception there exists
significant scope to improve capital efficiency and reduce capex intensity in the
pure textile business. Initiatives that are consideration include 100%
outsourcing of spinning units and entering into outsourcing arrangements with
third party denim and wovens manufacturers. As there is surplus capacity
available in the market, management believes it is better to outsource than to
put up new capacities. In contrast to ARVND, third parties are ready to work on
lower RoCE as they can use the numerous incentives available in the form of
TUFF loans and state level incentives which make their model profitable. These
initiatives, in our view, can structurally improve RoCE potential in the business
and result in further balance sheet deleveraging.

Verticalization from fabrics to garments - a key strategy
Verticalization from fabrics to garments is a key strategy that will gain
momentum over the next couple of years for ARVND. Garments segment, which
was an underperformer, has been effectively brought back to track. Company is
gaining business from new clients due to scale-up in garments. Earlier these
new clients never came to ARVND as they procured ready garments and did not
work on a model of procuring fabrics and giving to converters. With direct
market access with these new clients, company is gaining more visibility and
higher margins across the entire textile value chain.

Debt metrics will continue to improve
Management highlighted incremental capex will be largely done from internal
cash generation and thus debt in absolute terms will increase only marginally.
Capex guidance for FY15 stands at INR5b out of which INR2b will be invested in
brands & retail, INR2b in textiles, and INR1b in technical textiles, e-commerce
and corporate capex combined. Debt metrics improvement to continue as
absolute debt remains steady.

Valuation and view
We remain optimistic with ARVNDs transformation from a pure textile player
to a brands and retail powerhouse. We believe with its massive experience
gained in the textile business over the last few decades, company is well placed
to extend its experience to launch new initiatives - prime among these will be
e-commerce foray that is scheduled for launch over the next couple of quarters.
We believe that with RoCE and RoE at a decade high and increased contribution
from brands segment, capex intensity over the long term will reduce,
warranting a re-rating. We upgrade the target price from INR240 to INR270 (7x
FY16E EV/EBITDA), maintain Buy.







Arvind
10 June 2014 3
Brands and Retail business to be aggressively scaled up
Management is focused on scaling up the brands and retail business aggressively
over the next few years. Among the trade-off between scale and margins,
management will choose scale as this will increase the overall profit pool for the
company. While brands will witness incremental store additions largely through the
franchise route, retail will see store additions through the owned model route. This
has been strategically planned as there will always be limited capital to deploy and
growth has to be maximized within that pool of capital. ARVND will invest 7-8% of
revenue on marketing for individual brands.

Power brands growth robust; growth brands are tomorrows power brands
Power Brands like Arrow, Tommy, US POLO, Flying Machine will continue to
witness more than 25% growth. Incremental store addition for these two brands will
exclusively come from franchisees. Management will additionally invest aggressively
in internally identified Growth brands which are small presently but have the
potential for growth and be Power Brands over the next three years. These include
Nautica, Hanes, Gant, CK.

Power brands turnover

Source: Company, MOSL
Power brands margins steadily improves

Source: Company, MOSL

Brand extensions will be a major focus area for ARVND. Innerwear portfolio for
example is going to be a major growth segment over the next three to five years.
Company will host four brands in innerwear - Hanes, Tommy, CK and US Polo.

Hanes has seen its revenue double post acquisition by ARVND from INR300m to
INR600m over the last 12 months. Management believes there is huge potential for
the brand in India which is the No.1 innerwear brand in the US with global revenues
of USD5.1b. Key distribution channels like department stores are yet to be tapped.
There has hardly been any competition for the market leader, Jockey, till now and
Hanes, especially under the new management will surely be a credible competition
for Jockey. Revenue growth for the brand will be largely department stores led, with
contribution from EBOs expected to be miniscule.

Commenting on other brands, management believes Ed Hardy will require a greater
degree of customization to suit Indian fashion habits. Similarly, Elle and I-Zod are on
a slow growth path currently and management has chosen to let these brands
consolidate at current scale for the next couple of years.
2,180 3,940 6,200 7,840 10,680
78%
86%
90%
92%
85%
FY10 FY11 FY12 FY13 FY14
Power brands (INR m) Power brands % of total brands
7.4
9.3
9.5
11.2
11.7
FY10 FY11 FY12 FY13 FY14
Arvind
10 June 2014 4
Brands and Retail margins have significant room for expansion
Management believes that there exists significant room to improve on internal
inefficiencies. These exist largely in Growth Brands portfolio, while in case of Power
Brands there is no scope for inefficiencies. Management believes that as a Growth
Brand grows and enters the Power Brand club, inefficiencies will automatically
reduce due to better economies of scale for the brand.

Arrow, for example, is working at the optimal efficiency level and is a truly mature
brand in ARVNDs portfolio. However, on the other hand, for brands like Gant,
inventory turns will continue to remain low at the current operating scale as the
stocking requirements are high and the brand is yet to gain growth momentum.

Brands and Retail to contribute 33% to revenue by FY16E

Source: Company, MOSL
Contribution of brands to Power Brands revenue

Source: Company, MOSL


Mens dominate revenue contribution for brands

Source: Company, MOSL
EBOs dominate revenue contribution for brands business

Source: Company, MOSL

20.3%
23.7%
24.5%
26.0%
28.1%
30.9%
33.1%
FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Brands and Retail revenue contribution (%)
Arrow, 43.8
%
US
Polo, 30.0%
Flying
machine, 1
5.0%
Tommy, 11.
3%
Power Brands revenue contribution
Mens , 84
Womens, 6
Kids, 7
Non
apparel, 3
% share
EBOs, 57
MBO, 16
Departmen
tal
stores, 15
E
commerce,
4
Institutiona
l sales, 8
Arvind
10 June 2014 5
Brand portfolio and positioning

Source: Company, MOSL

Brands and retail RoCE set to expand
Management believes brands margins and asset efficiency can improve
tremendously from current levels. With gross margins at 50%, store level EBITDA
margins currently stand at 25%. Around 60-70% of inventories are sold at full prices,
while 30-40% of sales come from discount seasons. Management is targeting to sell
90% of inventory at full prices over the next two to three years. ARVND runs two
discount seasons annually. Typically, there is first season sale followed by second
season sale where prices are further discounted. Post second season sale,
consumers will not find any old stock at the stores as they will be moved to other
liquidation channels, for example e-commerce.

With a reduction in discounted sales and higher growth and efficiencies in growth
brand portfolio, overall margins in brands business can touch 12-13% over the next
couple of years. Asset turns for Power Brands will be improved from 3x to 4x, thus
ensuring 35% to 50% RoCE, while for Growth Brands, asset turns will be improved
from 1x to 3x and RoCE will be improved from single digits currently to 15-20%.

E-commerce foray to be next big factor
ARVND has transformed from being a pure textile player to a brands and retail
powerhouse over the last few years. With massive experience gained in the textile
business over decades, management is targeting entry into newer domains like e-
commerce, which is scheduled for launch over the next couple of quarters.

Our interaction with the management suggests that company is working on a unique
e-commerce platform, which will be launched under a new brand and will offer
differentiated offerings. For example, customization will be a major differentiator.
Online consumers can choose the color, fabric type, style, have messages written on
a t-shirt or any other garment they buy. These differentiators will be first of the kind
for Indian consumers. Also, ARVND plans to have retail kiosks which will be a
completely different brand concept.

Arvind
10 June 2014 6
MegaMart model has evolved over the years
Strategy for MegaMart (MM) has evolved with a change in environment for retailing
in India and ARVNDs own experience with this model. MM started off as a discount
store/liquidation channel but is now positioned as a value format. MM stocks
brands like Arrow to drive footfalls. But when a consumer walks into the store, he
goes through Arrow inventory, then goes though Excalibur and thus purchases
perhaps a single Arrow shirt and compliments the same with two to three Excalibur
shirts. This is how the model is evolving. Pure comparables for MM are MAX and
Reliance Trends not a V-Mart or Vishal Retail.

MM restructuring to be completed by 1HFY15
ARVND is working on a massive restructuring strategy for MegaMart (MM) stores.
The plan is to move from old format stores to newer ones. New format stores will be
larger typically 10,000sqft plus. Company has three 50,000sqft stores in MM. It has
reduced the store count for MM from 216 to 166 over the past couple of years due
to restructuring. However, retail space in MM has expanded during this period from
0.69msf to 0.75msf implying significant (40%) increase in sqft/store from
3,200sqft/store to 4,500sqft/store. MMs restructuring will be completed by
September 2014.

Total stores in brands segment (ALBL)

Source: Company, MOSL
Total sq ft and revenue per sq ft

Source: Company, MOSL

Total MM stores

Source: Company, MOSL
Total sqft area for MM

Source: Company, MOSL



228
352
570
698
848
998
FY11 FY12 FY13 FY14E FY15E FY16E
Number of stores
214,844
330,943
630,248
717,236
853,942
1,004,994
19,363
18,825
12,060
15,685
18,038
19,842
FY11 FY12 FY13 FY14E FY15E FY16E
Total sq ft Revenue per sq ft
200
216
197
166
181
196
FY11 FY12 FY13 FY14E FY15E FY16E
Number of stores
617,154
691,770 710,133
744,785
994,804
1,238,833
6,433
7,430
7,397
7,613
7,232 7,232
FY11 FY12 FY13 FY14E FY15E FY16E
Total sq ft Revenue per sq ft
Arvind
10 June 2014 7
ARVND is among the largest tenants after an anchor tenant in any retail space. This
gives it massive negotiating power. Management suggests stores that are opened
under the new format are working well and delivering margins of 8%, which is the
targeted margin for the format. However, old stores are loss making, which are
driving down the entire retail margins. Overall, management is targeting 20% RoCE
for MM business.

Significant room to expand RoCE in textile business
Management believes that contrary to popular perception there exists significant
scope to improve capital efficiency and reduce capex intensity in the pure textile
business. Initiatives that are consideration include 100% outsourcing of spinning
units and entering into outsourcing arrangements with third party denim and
wovens manufacturers. As there is surplus capacity available in the market,
management believes it is better to outsource than to put up new capacities. In
contrast to ARVND, third parties are ready to work on lower RoCE as they can use
the numerous incentives available in the form of TUFF loans and state level
incentives which make their model profitable. These initiatives, in our view, can
structurally improve RoCE potential in the business and result in further balance
sheet deleveraging.

Denim capacity utilization ramped up to ~100%

Source: Company, MOSL
Woven segment to be larger than denims

Source: Company, MOSL

RoCE at decade high

Source: Company, MOSL
RoE at decade high

Source: Company, MOSL



67
88
96 96
89
105
111
117
70%
92%
89% 89%
83%
97%
103%
108%
F
Y
0
9
F
Y
1
0
F
Y
1
1
F
Y
1
2
F
Y
1
3
F
Y
1
4
E
F
Y
1
5
E
F
Y
1
6
E
Qty sold Capacity utilisation %
27
58
68 68
87
103
125
140
48%
104%
94% 94%
103%
86%
95%
97%
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Qty sold (m mtrs) Capacity utilisation
3
12
9
9
8
8
7
6
8
11
14
13
15
16
18
F
Y
0
2
F
Y
0
3
F
Y
0
4
F
Y
0
5
F
Y
0
6
F
Y
0
7
F
Y
0
8
F
Y
0
9
F
Y
1
0
F
Y
1
1
F
Y
1
2
F
Y
1
3
F
Y
1
4
E
F
Y
1
5
E
F
Y
1
6
E
(19)
14
10
10
6
9
1
(8)
4
11
12 12
15
17 19
F
Y
0
2
F
Y
0
3
F
Y
0
4
F
Y
0
5
F
Y
0
6
F
Y
0
7
F
Y
0
8
F
Y
0
9
F
Y
1
0
F
Y
1
1
F
Y
1
2
F
Y
1
3
F
Y
1
4
E
F
Y
1
5
E
F
Y
1
6
E
Arvind
10 June 2014 8
Verticalization from fabrics to garments - a key strategy
Verticalization from fabrics to garments is a key strategy that will gain momentum
over the next couple of years for ARVND. Garments segment, which was an
underperformer, has been effectively brought back to track. Company is gaining
business from new clients due to scale-up in garments. Earlier these new clients
never came to ARVND as they procured ready garments and did not work on a
model of procuring fabrics and giving to converters. With direct market access with
these new clients, company is gaining more visibility and higher margins across the
entire textile value chain.

Garment capacity (m pieces)

Source: Company, MOSL
Garment capacity utilization

Source: Company, MOSL

Garment realization (INR/piece)

Source: Company, MOSL
Garment margins expected to improve further

Source: Company, MOSL


19 19
10 10 10 10
25 25
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Installed capacity
8
19
13
10 10
12
15
19
42%
100%
130%
100%
100%
110%
60%
75%
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Qty sold Capacity utilisation
277
352
460
504
546
601
649
FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Realisaiton (INR)
4.0%
-8.0%
1.0%
2.0%
11.0%
13.0%
13.5% 14.0%
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Margins (%)
Arvind
10 June 2014 9
Debt metrics will continue to improve
Management highlighted incremental capex will be largely done from internal cash
generation and thus debt in absolute terms will increase only marginally. Capex
guidance for FY15 stands at INR5b out of which INR2b will be invested in brands &
retail, INR2b in textiles, and INR1b in technical textiles, e-commerce and corporate
capex combined. Debt metrics improvement to continue as absolute debt remains
steady.

Debt-equity to decline from 1.2x to 1x in FY16E

Source: Company, MOSL

Debt-EBITDA to decline from 3.2x to 2.4x in FY16E

Source: Company, MOSL

Valuation and view
We remain optimistic with ARVNDs transformation from a pure textile player to a
brands and retail powerhouse. We believe with its massive experience gained in the
textile business over the last few decades, company is well placed to extend its
experience to launch new initiatives - prime among these will be e-commerce foray
that is scheduled for launch over the next couple of quarters. We believe that with
RoCE and RoE at a decade high and increased contribution from brands segment,
capex intensity over the long term will reduce, warranting a re-rating. We upgrade
the target price from INR240 to INR270 (7x FY16E EV/EBITDA), maintain Buy.


2.2
1.7
1.3
1.0
1.1
1.2
1.1
1.0
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Debt Equity (x)
7.5
5.4
4.2
3.5 3.6
3.2
2.8
2.4
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Debt/EBITDA (x)
Arvind
10 June 2014 10
Story in charts

Brands and retail is the key focus area to drive growth

Source: Company, MOSL
ARVIND has one of the best brands portfolios in the country

Source: Company, MOSL

Denim capacity utilization ramped up to ~100%

Source: Company, MOSL
Woven segment to be larger than denims

Source: Company, MOSL

RoCE at decade high

Source: Company, MOSL
RoE at decade high

Source: Company, MOSL


20.3%
23.7%
24.5%
26.0%
28.1%
30.9%
33.1%
FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Brands and Retail revenue contribution (%)
Arrow, 43.8
%
US
Polo, 30.0%
Flying
machine, 1
5.0%
Tommy, 11.
3%
Power Brands revenue contribution
67
88
96 96
89
105
111
117
70%
92%
89% 89%
83%
97%
103%
108%
F
Y
0
9
F
Y
1
0
F
Y
1
1
F
Y
1
2
F
Y
1
3
F
Y
1
4
E
F
Y
1
5
E
F
Y
1
6
E
Qty sold Capacity utilisation %
27
58
68 68
87
103
125
140
48%
104%
94% 94%
103%
86%
95%
97%
FY09 FY10 FY11 FY12 FY13 FY14E FY15E FY16E
Qty sold (m mtrs) Capacity utilisation
3
12
9
9
8
8
7
6
8
11
14
13
15
16
18
F
Y
0
2
F
Y
0
3
F
Y
0
4
F
Y
0
5
F
Y
0
6
F
Y
0
7
F
Y
0
8
F
Y
0
9
F
Y
1
0
F
Y
1
1
F
Y
1
2
F
Y
1
3
F
Y
1
4
E
F
Y
1
5
E
F
Y
1
6
E
(19)
14
10
10
6
9
1
(8)
4
11
12 12
15
17 19
F
Y
0
2
F
Y
0
3
F
Y
0
4
F
Y
0
5
F
Y
0
6
F
Y
0
7
F
Y
0
8
F
Y
0
9
F
Y
1
0
F
Y
1
1
F
Y
1
2
F
Y
1
3
F
Y
1
4
E
F
Y
1
5
E
F
Y
1
6
E
Arvind
10 June 2014 11



Financials and valuations

Income statement (INR Million)
Y/E March 2011 2012 2013 2014 2015E 2016E
Net Sales 40,846 49,251 52,925 68,621 83,359 100,436
Change (%) 25.2 20.6 7.5 29.7 21.5 20.5
EBITDA 5,297 6,022 6,874 9,340 11,670 14,503
EBITDA Margin (%) 13.0 12.2 13.0 13.6 14.0 14.4
Depreciation 1,725 1,614 2,043 2,252 2,765 3,105
EBIT 3,572 4,408 4,831 7,088 8,905 11,398
Interest 2,360 3,091 3,153 3,545 3,770 4,040
Other Income 547 1,185 806 694 709 760
Extraordinary items 0 -2,450 0 164 0 0
PBT 1,759 4,953 2,483 4,073 5,843 8,117
Tax 105 594 3 548 1,169 2,029
Tax Rate (%) 6.0 12.0 0.1 13.4 20.0 25.0
Reported PAT 1,654 4,359 2,481 3,526 4,675 6,088
Adjusted PAT 1,654 2,202 2,481 3,667 4,675 6,088
Change (%) 211.6 33.2 12.6 47.8 27.5 30.2
Min. Int. & Assoc. Share -5 0 3 13 13 13
Adj Cons PAT 1,649 4,359 2,484 3,539 4,688 6,101

Balance sheet (INR Million)
Y/E March 2011 2012 2013 2014 2015E 2016E
Share Capital 2,544 2,580 2,580 2,580 2,580 2,580
Reserves 14,404 17,738 19,959 23,248 27,031 31,924
Net Worth 16,948 20,318 22,540 25,829 29,611 34,505
Debt 22,102 21,283 24,608 29,920 32,920 34,420
Deferred Tax 217 189 58 435 435 435
Total Capital Employed 39,428 41,881 47,313 56,426 63,208 69,602
Gross Fixed Assets 40,517 39,668 42,875 48,456 53,956 58,956
Less: Acc Depreciation 15,411 13,737 15,930 18,182 20,948 24,053
Net Fixed Assets 25,106 25,932 26,945 30,274 33,008 34,903
Capital WIP 898 1,918 2,076 0 0 0
Investments 610 417 678 1,293 1,293 1,293
Current Assets 23,426 25,827 32,635 42,064 49,944 59,007
Inventory 12,363 11,261 14,129 16,281 19,224 22,784
Debtors 5,018 6,422 7,547 10,093 12,333 14,309
Cash & Bank 585 709 1,856 1,662 1,273 1,036
Loans & Adv, Others 5,460 7,435 9,104 14,028 17,114 20,879
Curr Liabs & Provns 10,611 12,213 15,021 17,206 21,038 25,602
Curr. Liabilities 10,504 11,206 14,130 16,127 19,744 24,050
Provisions 108 1,006 891 1,078 1,294 1,553
Net Current Assets 12,815 13,614 17,614 24,859 28,906 33,405
Total Assets 39,428 41,881 47,313 56,426 63,208 69,602
E: MOSL Estimates

Arvind
10 June 2014 12


Financials and valuations

Ratios
Y/E March 2011 2012 2013 2014 2015E 2016E
Basic (INR)
EPS 6.5 16.9 9.6 13.7 18.2 23.6
Cash EPS 13.3 14.8 17.5 22.9 28.8 35.6
Book Value 66.6 78.7 87.4 100.1 114.8 133.7
DPS 0.0 1.0 1.7 2.4 3.0 4.0
Payout (incl. Div. Tax.) 0.0 6.9 20.1 20.1 19.4 19.8
Valuation(x)
P/E

20.8 14.6 11.0 8.5
Cash P/E

11.4 8.7 6.9 5.6
Price / Book Value

2.3 2.0 1.7 1.5
EV/Sales

1.3 1.1 0.9 0.8
EV/EBITDA

9.8 7.8 6.6 5.4
Dividend Yield (%)

0.8 1.2 1.5 2.0
Profitability Ratios (%)
RoE 11.1 23.4 11.6 14.6 16.9 19.0
RoCE 11.1 13.9 12.7 15.1 16.3 18.5
Turnover Ratios (%)
Asset Turnover (x) 1.0 1.2 1.1 1.2 1.3 1.4
Debtors (No. of Days) 44.4 46.9 51.3 53.0 53.5 51.3
Inventory (No. of Days) 110.5 83.5 97.4 86.6 84.2 82.8
Creditors (No. of Days) 107.8 94.6 112.0 99.3 100.5 102.2
Leverage Ratios (%)
Net Debt/Equity (x) 1.3 1.0 1.1 1.2 1.1 1.0

Cash flow statement (INR Million)
Y/E March 2011 2012 2013 2014 2015E 2016E
OP/(Loss) before Tax 1,759 4,953 2,483 4,237 5,843 8,117
Depreciation 1,725 1,614 2,043 2,252 2,765 3,105
Others 0 0 0 0 0 0
Interest 2,098 2,786 2,826 3,545 3,770 4,040
Direct Taxes Paid 311 839 620 548 1,169 2,029
(Inc)/Dec in Wkg Cap -3,013 -1,874 -1,700 -7,438 -4,436 -4,736
CF from Op. Activity 1,967 3,352 4,573 2,048 6,774 8,497
(Inc)/Dec in FA & CWIP -1,126 -2,324 -2,815 -5,581 -5,500 -5,000
(Pur)/Sale of Invt 46 136 -281 0 0 0
Others 69 2,523 -213 0 0 0
CF from Inv. Activity -1,012 335 -3,308 -5,581 -5,500 -5,000
Inc/(Dec) in Net Worth 0 0 0 0 0 0
Inc / (Dec) in Debt 994 -620 3,195 7,593 3,013 1,513
Interest Paid -1,802 -2,944 -3,014 -3,545 -3,770 -4,040
Divd Paid (incl Tax) -1 0 -298 -709 -906 -1,208
CF from Fin. Activity -809 -3,563 -117 3,339 -1,663 -3,735
Inc/(Dec) in Cash 147 124 1,147 -194 -389 -237
Add: Opening Balance 438 585 709 1,856 1,662 1,273
Closing Balance 585 709 1,856 1,662 1,273 1,036
E: MOSL Estimates
Arvind
10 June 2014 13
N O T E S

Arvind
10 June 2014 14

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