3

StockWatch
StockWatch
Watch list
The following are fundamentally strong companies identified by Capital Market analysts. The list is constantly reviewed and updated,
adding scrips with upward potential and removing those that have, in our opinion, exhausted their run.
COMPANY
Ador Welding
Akzo Nobel
Astral Poly
Auto.Corp.of Goa
Axis Bank
BHEL
Bajaj Corp
Bajaj Electric
Bajaj Fin.
Balmer Lawrie
BASF India
Benares Hotels
Bharat Forge
Bharat Gears
Bosch
Britannia Inds.
Career Point
Castrol India
Competent Auto.
CRISIL
D B Corp
Elantas Beck
Engineers India
Esab India
Escorts
Essel Propack
Fag Bearings
Federal Bank
Foseco India
Garware-Wall
Gateway Distr.
GE Shipping Co
GMM Pfaudler
Godrej Consumer
Goodyear India
Greaves Cotton
Gulf Oil Lubrica
HDFC
HCL Technologies
HDFC Bank
Hero Motocorp
Hikal
Hindustan Media
Honeywell Auto
HSIL
Huhtamaki PPL
Indian Hume Pipe
Infosys
Ingersoll-Rand
Intl. Travel Hse
ION Exchange
J & K Bank
IND.
NO.
41
63
75
10
12
39
65
36
50
108
22
57
17
10
10
54
106
22
101
106
47
22
45
41
7
62
13
12
22
97
106
82
44
65
105
46
22
51
27
12
9
71
47
43
21
62
20
27
25
104
44
11
PRICE (Rs)
14-12-2015
328
1316
426
424
431
167
425
204
5438
600
887
1196
795
85
18241
2833
138
428
138
1889
330
1327
215
586
153
159
4089
54
1317
384
318
358
256
1268
557
143
472
1188
841
1055
2537
165
278
8901
298
236
424
1070
781
219
325
76
TTM
YEAR
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
TTM
EPS (Rs)
15.7
30.7
6.6 *
19.6
33.5
3.8
15.1
2.6
194.8
59.2
0.0
67.7
32.8
5.6
308.5
58.5 *
3.9 *
12.3
19.9
36.7 *
16.1 *
49.0
7.6
15.7
7.7
10.4 *
109.5
4.9
48.7
24.0
14.1 *
66.3 *
10.5
30.0 *
43.2
5.9
17.0
57.9 *
51.6 *
44.2
124.2
3.2
22.1
148.3
15.4
10.0 *
13.0
55.8 *
16.7
19.9
20.7
11.6
P/E
21.0
42.9
64.7
21.6
12.9
43.8
28.2
80.0
27.9
10.1
0.0
17.7
24.2
15.2
59.1
48.4
35.8
34.9
7.0
51.5
20.5
27.1
28.3
37.2
19.8
15.4
37.4
11.0
27.1
16.0
22.6
5.4
24.3
42.3
12.9
24.4
27.8
20.5
16.3
23.9
20.4
51.7
12.6
60.0
19.3
23.6
32.6
19.2
46.7
11.0
15.7
6.6
COMPANY
JMC Projects
K E C Intl.
Kalpataru Power
Kansai Nerolac
Karnataka Bank
KEI Inds.
Kennametal India
KSB Pumps
L G Balakrishnan
L&T Fin.Holdings
Lak. Electrical
Lak. Mach. Works
Larsen & Toubro
LIC Housing Fin.
M&M
M M Forgings
Maruti Suzuki
NBCC
Nelcast
Omkar Spl.Chem.
Pitti Lamination
PNB Gilts
Poddar Pigments
Power Grid Corpn
PPAP Automotive
Prec. Wires (I)
Rajoo Engineers
Rallis India
Raymond
SKF India
South Ind.Bank
St Bk of India
Sterling Tools
Sudarshan Chem.
Sundaram Finance
Sundram Fasten.
Sunil Hitech
Supreme Inds.
Swaraj Engines
TCS
Thermax
Tide Water Oil
Time Technoplast
Va Tech Wabag
Vesuvius India
V-Guard Inds.
Voith Paper
WABCO India
Whirlpool India
Wipro
WPIL
Yes Bank
IND.
NO.
31
102
102
63
12
15
44
78
10
50
39
92
45
51
7
17
6
31
17
22
44
50
22
76
10
59
44
67
97
13
12
11
48
38
50
48
45
75
46
27
44
22
75
44
81
39
97
10
36
27
78
12
PRICE (Rs)
14-12-2015
239
151
243
251
118
102
741
572
519
64
426
3406
1274
473
1287
518
4570
956
63
210
52
25
143
128
159
156
21
165
406
1198
19
227
468
104
1322
151
323
629
912
2377
893
17336
53
681
750
933
585
5684
653
567
394
682
TTM
YEAR
TTM
EPS (Rs)
P/E
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
201509
13.9
4.6 *
11.1
5.8
25.6
6.1
11.9
15.7
33.3
4.7 *
27.4
188.8
43.0 *
30.1
48.3
41.6
134.1
24.7 *
3.4
14.6 *
2.3
4.1
15.6
10.5
9.1
11.4
1.0
7.1 *
11.6 *
35.8
2.2
23.5 *
37.6
7.4
43.1
7.1
25.0
25.2 *
38.3
105.5 *
26.3
888.6
5.8 *
16.4 *
34.3
25.8
35.1
80.3
17.5
34.8 *
13.4
53.7
17.2
33.2
21.9
43.1
4.6
16.8
62.4
36.4
15.6
13.7
15.5
18.1
29.7
15.7
26.6
12.5
34.1
38.7
18.8
14.4
22.5
6.2
9.2
12.2
17.5
13.6
21.4
23.3
35.0
33.5
8.7
9.6
12.5
14.1
30.7
21.2
12.9
25.0
23.8
22.5
34.0
19.5
9.2
41.5
21.9
36.1
16.7
70.8
37.2
16.3
29.3
12.7
* indicates that EPS is consolidated. TTM: Trailing 12 months. This issue Nelcast replaces DIC India.
Dec 21, 2015 Jan 03, 2016 CAPITAL MARKET
67
StockWatch
Capita Telefolio
beats
S&P BSE Sensex
400%
Nelcast
A strong cast
see page 85
The focus of the maker of parts for commercial vehicles and tractors is
now shifting to diversifying customers, markets and product range
Nelcast is one of Indias largest suppliers of
ductile iron and grey iron castings ranging
from 0.5 kg to 260 kg. Total capacity is 1.50
lakh tonnes.
Parts required for various applications
in automobiles such as engine, transmission, suspension, axle, brake and steering are manufactured. The tractor industry sources components for its requirement of various housings as well as engine, transmission and axle components.
Other users include the railways and the
pipe fittings industries.
From catering to the commercial vehicle
(CV) industry since 1985 and the tractor
industry since 1988, there has been diversified into other industries to fulfill their casting needs. The products cater to the global
automotive, tractor, construction, mining,
railways and general engineering sectors.
Customers include some of the leading global companies in these sectors.
Clients include original equipment manufacturers Motors, Ashok Leyland, Tafe,
Eicher Tractors, Mahindra & Mahindra,
Volvo-Eicher Commercial Vehicles, Same
Tractors, Escorts Tractors, Sonalika Tractors, Daimler India, Ashok Leyland John
Deere and Caterpillar. Tier I auto ancillary
users are Automotive Axles, American Axles, Dana, Rane Madras, Rane-TRW, ZF
India and Simpson & Co. and export customers include Meritor and ZF Industries.
Spheroidal graphite iron castings, which
are increasingly preferred by user industries, constitute over 75% of the production. These castings are versatile, valueadditive and have higher ductility and tensile strength compared with grey iron castings. There is effort to increase revenues
from the Railways and the industrial castings segment. Products are being developed
for construction and earth-moving equipment players. This will also help boost
exports. The focus is also on increasing the
share of machined components to boost
realizations and help margin expansions.
There is continuous thrust on developing new products for applications in CVs
and tractors. More than 100 new compo68
Launching new products

Nelcast developed over 100 new
components for commercial vehicles,
tractors, army and construction and
mining applications last fiscal
75
65
55
45
35
25
D J'15
D *
nents were developed for these segments in

the fiscal ended March 2015 (FY 2015).
Several new products were developed for
heavy trucks, army and construction and
mining applications.
Production facilities at Gudur in Andhra
Pradesh have been upgraded. This will enable attracting new customers, both from
the domestic and exports markets. The modernization will enable catering to the newer
generation of vehicles and supply of superior quality of products. A foray was made
into the global SUV market last fiscal.
Many research activities have been un-
Nelcast: Financials
1303(12) 1403(12) 1503(12) 1603(12P)
Sales
507.60
515.16
544.89
568.32
OPM (%)
6.5
9.4
8.3
11.6
OP
32.95
48.56
45.16
65.91
Other inc
1.91
2.43
1.73
2.34
PBIDT
34.86
50.99
46.88
68.25
Interest
3.05
1.85
4.68
6.06
PBDT
31.81
49.14
42.20
62.19
Dep.
11.11
12.84
12.65
12.99
PBT
20.70
36.29
29.55
49.20
PBT after EO
20.70
36.29
29.55
49.20
Total Tax
6.79
13.80
7.60
13.96
PAT
13.91
22.50
21.94
35.24
EPS (Rs) *
1.6
2.6
2.5
4.1
* Annualised on current equity of Rs 17.40 crore.
Face Value: Rs 2. (P): Projections. Figures in Rs crore
Source: Capitaline Databases
dertaken for component weight reduction,

core cost reduction, core weight reduction,
process designing and process improvement. Riding on the R&D division, the
market was expanded and competitive position strengthened through improved products for new markets.
The product development lead time was
reduced and product quality improved due
to advancement of simulation capabilities.
Through R&D, surface finish of the products was improved, thereby obtaining new
global business opportunities.
R&D will be used to focus on expanding the market for automotive applications
and conversion of components from other
processes and materials to iron castings.
New products such as differential carriers
and axle housings will be launched for overseas customers.
Also, new materials will be developed
for innovative next-generation products
such as austempered ductile iron applications and new production processes to create competitive advantage in a certain range
of components.
Sales grew 1% to Rs 156.21 crore and
the operating profit margins (OPM) jumped
470 basis points (bps) to 12.8%, taking up
operating profit (OP) 58% to Rs 20.06 crore
in the fourth quarter ended September 2015
over a year ago. Profit after tax (Pat) was up
70% to Rs 10.42 crore.
Sales inclined 4% to Rs 297.83 crore and
the OPM spurted 350 bps to 11.6%, boosting OP 49% to Rs 34.53 crore in the six
months ended September 2015 over a year
ago. Pat surged 71% to Rs 17.55 crore.
An expected improvement in demand for
tractors from the second half of current fiscal, continued healthy growth in sales of
medium and heavy CVs and de-risking efforts by entering manufacture of castings
for off-road vehicles hold promise for longterm prospects.
We expect Nelcast to register net sales
of Rs 568.32 crore and Pat of Rs 35.24 crore
in FY 2017. EPS works out to Rs 4.1. The
scrip was trading around Rs 64 on 14 De
cember 2015.
MarketWatch
MarketWatch
Movers and shakers

Movements in large-cap stocks* as on 11 December 2015
COMPANY (FV)
SECTOR
Tata Motors (Rs 2)
Automobile
Beta:1.3027
Titan Company (Re 1)

Diamond, Gems
and Jewellery
Beta:0.555
Glenmark Pharmaceuticals (Re 1)

Pharmaceuticals / Beta:0.9057
Dr Reddys Laboratories (Rs 5)
Pharmaceuticals
Beta:0.758
Ashok Leyland (Re 1)

Automobile
Beta:1.341
Bharat Forge (Rs 2)

Castings, Forgings
& Fastners
Beta:1.1941
MCAP
(Rs cr)
LATEST
CLOSE (Rs)
FORT
1-YEAR
VAR (%)
123158
378
-11
-24
FII
EBIDTA
STAKE (%) VAR (%)
18
-21
DIV
DEBT/
YLD (%) EQUITY
0
P/BV
ROCE
(%)
2
18
ROE
(%)
23
The Mumbai-based automobiles makers total sales declined 7% to 38,918 units in November 2015
over November 2014. Domestic sale of Tata commercial and passenger vehicles fell 6% to 35,345 units
in November 2015 over November 2014. Exports fell 17% to 3,573 units.
31344
353
-9
-8
19
-18
10
34
29
The Reserve Bank of India notified that registered foreign portfolios investors can now invest up to
35% of the paid up capital of the Tamil Nadu-based eyewear, watches and jewelry maker. Total FII
holding in Titan Company stood at 21.07% as per the shareholding pattern on 30 September 2015.
24473
867
-9
37
-6
12
16
50584
2965
-5
-14
37
10
22
26
Shares of both these drug makers declined on reports the latest political developments in Venezuela
might impact business prospects of these two firms. Media reports suggest that the victory of the
Opposition party in the Venezuela National Assembly elections on Sunday, 6 December 2015, might
have an impact on Indian drug companies due to a change in the political landscape of the South
American country and the many economic reforms the Opposition plans to roll out there. Reports
indicated that the country might even go for currency devaluation. There is likelihood that the currency will be converted to market-determined rates from a fixed-rate regime. Select drug makers might
be significantly impacted in case the government decides to devalue the currency in the near to medium
term. These changes might impact Glenmark Pharmaceuticals and Dr. Reddys Laboratories, which
reportedly earn decent revenues from Venezuela.
24588
86
-8
71
21
62
-36
The Chennai-based commercial vehicles maker started its regular operations at its Ennore manufacturing unit near Chennai from 7 December 2015. Production activity at the Ennore plant was stopped
due to heavy rains and floods in Chennai. The company said it will be able to assess the losses arising
from heavy rains and floods only after an assessment is done by the insurance company.
18637
801
-7
-13
14
26
22
25
At an analyst meet on 8 December 2015, the Pune-based metal forming companys management
said that the near-term outlook remains challenging and expects standalone revenue to remain flat
in the financial year ending March 2016 (FY 2016). Reports suggested that the revenue guidance
was below the estimates of some analysts. A foreign broker had estimated Bharat Forge to post a
6% revenue growth this fiscal. Citing a slowdown in US truck demand, Bharat Forge reportedly
said there has been a temporary increase in inventory of heavy-duty Class 8 trucks from two
months to three-and-a- half months. There has been a sharp volume drop in commodity and allied
business like construction, mining and oil and gas. Bharat Forge however maintained its FY 2018
revenue target of Rs 7000 crore, driven by the passenger vehicle segment, strong growth from
transmission segment and execution in the domestic non-auto segment like aerospace, mining,
defence, and railways.
69
MarketWatch
OMPANY (FV)
SECTOR
ITC (Re 1)
Tobacco Products
Beta:0.7873
MphasiS (Rs 10)

IT - Software
Beta:0.3684
Siemens (Rs 2)
Electrical Equipment
Beta:1.3863
Eicher Motors (Rs 10)

Automobile
Beta:1.071
NBCC (Rs 10)

Realty
Beta:1.3562
Bharat Heavy Electricals (Rs 2)

Beta:1.1282
70
MCAP
(Rs cr)
257761
LATEST
CLOSE (Rs)
321
FORT
1-YEAR
VAR (%)
-6
-19
FII
EBIDTA
STAKE (%) VAR (%)
15
DIV
DEBT/
YLD (%) EQUITY
2
P/BV
ROCE
(%)
8
49
ROE
(%)
33
Shares of Indias largest cigarette maker by sales slumped after a committee recommended sin or
demerit rate at about 40% for tobacco and tobacco products. A committee headed by the Chief
Economic Adviser Arvind Subramanian on Possible Tax Rates under Goods and Services Tax (GST)
submitted its report to the Finance Minister on 4 December 2015. The committee said that is now
growing international practice to levy sin rates in the form of excises outside the scope of the GST on
goods and services that create negative externalities for the economy. As currently envisaged, such
demerit rates other than for alcohol and petroleum (for the states) and tobacco and petroleum (for
the Centre) will have to be provided for within the structure of the GST. The foregone flexibility
for the center and the states is balanced by the greater scrutiny that will be required because such taxes
have to be done within the GST context and, hence, subject to discussions in the GST Council.
Accordingly, the committee recommended that the sin rate be fixed at about 40% (Centre plus states)
and apply to tobacco and tobacco products (for the states).
9938
473
-6
22
20
16
13
A foreign broker downgraded shares of the Bengaluru-based IT company to sell. The broker reportedly feels the recent price rally in MphasiS has more to do with markets appetite for mid-cap IT firms
and not much about any turnaround in the companys fundamentals. After Q2 September 2015
results, MphasiS share price witnessed a jump despite no material improvement in growth or margin
profile but it continues to face declining revenues from its largest client HP. Shares rallied 18.94% to
settle at Rs 497.30 on 3 December 2015 from Rs 418.10 on 20 October 2015 after the company
announced its Q2 September 2015 results before market hours on 21 October 2015.
40762
1145
-6
27
78
10
The Mumbai-based electrification, automation and digitalization company won an order worth approximately Rs 102 crore for power transmission system in West Bengal. Siemens will supply a 400 kilovolt
gas insulated switchgear substation to West Bengal State Electricity Transmission Company.
42257
15562
-6
11
27
53
17
41
31
The New Delhi-based automobiles company resumed production of motorcycles at its two plants
in Chennai on 7 December 2015 which were shut down due to heavy rains and flooding in Chennai.
These two units were shut since 1 December 2015 due to heavy rains and flooding in Chennai. There
was no damage to equipment or property due to rains and floods in Chennai and all employees are
safe and secure. It suffered production loss of 7,200 motorcycles due to the closure of both the
manufacturing facilities between 1 and 6 December 2015. Many parts of the supply chain still
continue to be affected due to the aftermath of floods. Due to the rains, the company lost production of 4,000 motorcycles in November 2015.
11355
946
-5
10
21
34
22
The New Delhi-based construction company won construction orders from Indian Culinary Institute.
The contract from Indian Culinary Institute at Noida in Uttar Pradesh amounts to Rs 98.50 crore. The
contract from Indian Culinary Institute at Tirupati in Andhra Pradesh amounts to Rs 89.42 crore.
NBCC will charge 7% agency charges on actual cost for both the works.
40496
165
-5
-35
16
-54
Heavy Industry Minister Anant Geete reportedly clarified that there were no plans of divestment of
the governments stake in the New Delhi-based state-run engineering and manufacturing enterprise.
The government held 63.06% stake in Bhel end September 2015. In March 2014, the government had
MarketWatch
OMPANY (FV)
SECTOR
MCAP
(Rs cr)
LATEST
CLOSE (Rs)
FORT
1-YEAR
VAR (%)
FII
EBIDTA
STAKE (%) VAR (%)
DIV
DEBT/
YLD (%) EQUITY
P/BV
ROCE
(%)
ROE
(%)
sold 4.66% stake. However, the minister admitted the performance of the PSU is improving and, after
two difficult years, there were orders of over Rs 22000 crore.
Dabur India (Re 1)
FMCG
Beta:0.5865
NMDC (Re 1)
Mining & Mineral
products
Beta:0.7345
Havells India (Re 1)

Beta:0.7593
47163
268
-4
14
21
19
14
36
36
The New Delhi-based consumer goods companys sales were affected by the prevailing political
tension in Nepal. The India-Nepal border continues to remain closed. The company lost some
part of juice sale in October and November 2015 and estimated juice sale in Q3 December 2015
will be lower by 10-15% from the previous year. This is a one-time issue and will have a nearterm impact on Q3 December 2015 performance. However, the company should be able to get
back on track in Q4 March 2016. Production of juices has been ramped up in Sri Lanka and Newai
in Rajasthan and third parties engaged to cater to demand requirement for the month of December
and going forward. Depending upon the timing of opening of the border, the impact on inventory
and other cost will be evaluated.
34850
88
-4
-36
-31
10
31
21
The Hyderabad-based state-run iron ore miner reduced prices of lump ore by Rs 300 per ton to Rs
1800 per ton from 4 December 2015. However, prices of iron ore fines were kept unchanged at Rs
1560 per ton. The prices are excluding royalty, taxes, District Mineral Foundation, duties and levies.
18803
301
23
10
23
22
The Delhi-based maker of lighting and electrical products decided to sell 80% stake in European
lighting systems and fixtures company Sylvania, to Shanghai Feilo Acoustics Co, one of the leading
listed companies with key shareholding held by Inesa , a state-owned enterprise of Shanghai Government. Further, Havells India proposes to divest 80% stake in its wholly owned subsidiary, Havells
Exim, Hong Kong. The combined equity value for 100% stake for both companies is 186 million euros
(Rs 1340 crore) as against Havells cumulative investment value of Rs 980 crore.
Sun Pharmaceutical Inds (Re 1)
182437
Pharmaceuticals
Beta:0.8315
Sun Pharmaceutical Industries entered into a tripartite research and option agreement with Israelbased Weizmann Institute of Science and Spains Health Research Institute of Santiago de Compostela
to develop products for neurological diseases like brain stroke, as well as glioblastoma, a lethal brain
cancer. The company will have the exclusive option to conduct further development of the enzyme
after completion of the preclinical studies and commercial rights to this product globally. Moreover,
this enzyme may potentially be indicated for uses beyond these two brain diseases. Sun Pharma will
have the right to develop these additional indications.
Tata Steel (Rs 10)

Steel
Beta:1.4771
23397
758
241
-9
-43
20
-27
-57
23
25
-11
T S Global Holdings (TSGH), a subsidiary of Mumbai-based steel major incorporated in Singapore,

executed agreements for loan facilities of US$1.5 billion comprising a five-year loan of US$750
million and a six-year loan of US$750 million. The proceeds of this loan will be used to repay
existing term loan facilities in TSGH. The new loan facilities are at lower cost and with extension of
the loan tenor and provide greater flexibility in their terms and conditions. This will give financial
headroom for the business as it faces tough market conditions even as overall leverage and debt
remain unaffected.
* On standalone basis. Only for stocks with market cap above Rs 8000 crore. Beta is a measure of a stocks volatility in relation to the key benchmark index. Higher the beta of the stock, higher
will be the volatility in the stock price and, hence, riskier the investments. The beta of the index or the market is pegged at 1. Earnings before interest, depreciation, tax and amortisation (Ebidta)
based on trailing 12 months (TTM) ended September 2015. Change in Ebidta is over the corresponding previous period. Dividend yield, return on equity (RoE) and return on capital employed
(RoCE) are for the year ended March 2015, except for Siemens (September 2014) and Eicher Motors (Decemebr 2014). Debt-equity is of the latest financial year end and P/BV data is as on date.
Compiled by Abhishek Panchal
71
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MarketWatch
MarketWatch
Growing concern, here...
... and abroad
Hopes of pushing the goods and

services tax in the winter session of
Parliament have dashed, with Congress
repeatedly disrupting proceeding
Investors are worried that once the

US Federal Reserve starts raising
interest rates, it will drain liquidity
from global emerging markets
110
102
105
100
BSE Sensex
BSE Sensex
100
98
95
96
BSE Dollex 30
India VIX
90 l
l
11-Nov
2015
l
25-Nov
l
11-Dec
2015
Base = 100
Rise or fall in India VIX depicts increase or decline in volatility
in the near term
94 l
l
11-Nov
2015
l
25-Nov
l
11-Dec
2015
Base = 100
Rise or fall in the BSE Dollex 30 depicts firmness or weakness
of the rupee
Catching cold
Global growth worries on sharp fall in crude oil prices
lead to selling by foreign investors
Key benchmark indices slumped in the fortnight ended 11 December 2015 in line with
the slide in global stocks as a recent sharp
drop in global crude oil prices heightened
fears about receding global growth. Diminishing hopes that the constitutional amendment bill on goods and services tax (GST)
will be passed during the ongoing winter
session of Parliament with main opposition
Congress party repeatedly disrupting the
parliament also weighed on investor sentiment. Selling by the foreign portfolio investors (FPIs) also aggravated the decline.
The barometer index, the S&P BSE
Sensex, slipped below the psychological
26,000 mark. The index had also fallen below
the 25,000 mark in intraday trade on last
session of the fortnight on 11 December 2015.
However, it managed to claw back and
settled slightly above that mark.
Prospects of increase in interest rates
by the US Federal Reserve at its monetary
policy meeting scheduled mid December
2015 also kept investors on tenterhooks.
Investors in emerging markets, including
India, are worried that once the Fed starts
raising interest rates, it will drain liquidity
from global emerging markets and redirect it
to developed economies. The US central
bank has held its benchmark short-term
interest rate near zero since December 2008.
The ultra-loose monetary policy in the US
has encouraged heavy investment in higheryielding emerging markets.
The Sensex slumped 1,083.77 points,
74
or 4.14%, to settle at 25,044.43 in the

fortnight ended 11 December 2015. The 50unit NSE Nifty 50 index tanked 332.25
points, or 4.18%, to settle at 7,610.45. The
BSE Mid-Cap index skidded 3.71%. The
BSE Small-Cap index lost 2.88%. The
decline in both these indices was lower in
percentage terms compared with the Sensexs
fall. The Sensex fell in seven out of 10
sessions of the fortnight.
The Sensex has declined 1,101.24
points, or 4.21%, in this month till 11
December 2015. The Sensex has fallen
2,454.99 points, or 8.92%, in this calendar
Domestic flavour
How the indices moved
NAME
BSE Sensex
CNX NIFTY
BSE 200
BSE 500
BANKEX
BSE Auto
BSE Realty Index
BSE Cap Goods
BSE Power
BSE Cons Durable
BSE FMCG Sector
BSE Oil&Gas
BSE Metal
BSE Tech
BSE Healthcare
BSE IT Sector
11-DEC-15
25044.43
7,610.45
3229.89
10161.21
18651.32
17822.2
1266.44
13845.54
1811.43
11857.03
7659.54
9008.31
6902.75
5808.53
16141.53
10751.91
VARI(%)
PE 15 DAYS YEARLY
20
21
21
21
15
20
-363
93
40
16
45
13
-31
21
36
20
-4.15
-4.14
-4.01
-3.9
-6.08
-5.6
-4.85
-4.74
-4.23
-3.9
-3.8
-3.39
-3.37
-1.69
-1.37
-0.76
-9.27
-8.23
-5.47
-4.96
-11.56
-5.01
-22.33
-10.89
-11.23
21.12
-5.73
-10.5
-35.68
1.38
8.2
3.99
year till 11 December 2015. From a 52-week

low of 24,833.54 hit on 8 September 2015,
the Sensex has risen 210.89 points, or 0.84%.
The Sensex is off 4,980.31 points, or 16.58%,
from a record high of 30,024.74 hit on 4
March 2015.
The current P/E multiple of Sensex stands
at 19.62, as per data from BSE. The P/E
multiple for BSE Small-Cap index is 58.95
and that of BSE Mid-Cap index is 25.08.
Foreign portfolio investors (FPIs) sold
shares worth a net Rs 4443.45 crore into the
secondary equity markets in the fortnight.
FPIs have sold shares worth a net Rs 6216.58
crore in the calendar year 2015 so far.
In the global commodities market, crude
oil futures for January 2016 settlement
tanked US$7.15 a barrel or 15.93% to settle
at US $37.71 a barrel in the fortnight.
In the foreign exchange market, the rupee
edged lower against the dollar. The partially
convertible rupee fell 13 paise or 0.19% to
settle at 66.89 during the fortnight.
The Reserve Bank of India (RBI) kept
its benchmark interest rate viz. the repo
rate unchanged at 6.75% after a monetary
policy review on 1 December 2015. The
central bank also kept the cash reserve ratio
for commercial banks unchanged at 4% of
net demand and time liability. Retaining the
easing stance of monetary policy, the RBI
said that it will use the space for further
accommodation when available. The central
bank said that switching to the marginal
cost of funds methodology for determining
the base rate and linking small savings
interest rates to market interest rates will
allow increased transmission of policy rates
into lending rates.
Indias gross domestic product (GDP)
rose 7.4% in Q2 September 2015 over Q2
Commodity flow
47
45
43
Brent crude oil per barrel in US$
41
39
37 l
l
11-Nov
2015
l
25-Nov
l
11-Dec
2015
Exchange equation
65.9
66.1
66.3
Rs per US$
66.5
66.7
66.9
l
l
10-Nov
2015
l
26-Nov
l
l
11 Dec
2015
MarketWatch
In the limelight
BSE Small-caps
BSE Mid-caps
NAME
11 DEC
(Rs)
27 NOV
(Rs)
VAR
(%)
P/E
NAME
11 DEC
(Rs)
27 NOV
(Rs)
VAR
(%)
P/E
Gainers
Tilak Finance*
6.21
4.61 34.71
0
Rasoya Proteins
0.32
0.24 33.33
0
KSK Energy Ven.
47.2
39.35 19.95
0
Amtek Auto
49.35
42.7 15.57
0
Indian Hotels
107.55
93.1 15.52
0
Tata Tele. Mah.*
7.89
6.96 13.36
0
JSW Steel
968.5
871.2 11.17 54.62
TV18 Broadcast
37.4
33.65 11.14 36.05
Jet Airways
561.6
505.8 11.03
0
S C I*
89.45
81.55
9.69
9
Losers
Trinity Tradeli.*
1.38
2.16 -36.11
0
PS IT Infra*
6.96
10.45 -33.4
348
Risa Internatio.*
3.79
5.28 -28.22
29
PMC Fincorp*
0.69
0.83 -16.87
0
JP Associates
10.77
12.72 -15.33
0
Goldline Intl.*
141
165.3 -14.7
0
Adani Power
26.2
30.7 -14.66
0
JSW Energy
74.9
87.3 -14.2
9.03
Oriental Bank*
133.25
155.15 -14.12
6
Kaveri Seed Co.
370.45
427.7 -13.39
12.3
* PE on standalone basis, others on consolidated basis
Gainers
Sharon Bio-Med.
31.25
20.7 50.97
0
Virtual Global*
10.41
7.84 32.78
260
Metalyst Forg.*
77.55
59.6 30.12
0
Sterling Intl
2.36
1.82 29.67
1.61
Sharp India*
53.8
41.75 28.86
0
MIRC Electronics
16.6
12.9 28.68
0
3i Infotech
5.08
3.95 28.61
0
Jindal Stain.
26.95
21.25 26.82
0
Rollatainers
53.95
42.55 26.79
28.5
TRIL
230.7
184 25.38
0
Losers
Nyssa Corp.*
59.55
84.75 -29.73
75
Tarang Projects*
9.34
13.05 -28.43
29
Risa Internatio.*
3.79
5.28 -28.22
29
Rupa & Co
292.5
377.8 -22.58 36.54
Gammon India
15
19.09 -21.42
0
Atlanta
26.1
32.8 -20.43
4.64
Subex
12.4
15.37 -19.32 12.32
Country Club Hos
12.55
15.5 -19.03
7.57
Sh.Renuka Sugar
11.83
14.52 -18.53
0
Maxwell Inds.*
54.7
65.65 -16.68
0
* P/E on standalone basis, others on consolidated basis.
Investor participation
Inflows and outflows
Shares trended
Net investment in equity market by foreign

portfolio investors and mutual funds
DATE
TOTAL
VOLUME
30/11/2015
340900000
NO. OF
NET
TRADES TURNOVER
1709902
2831.87
FPIs (Rs cr)
MFs (Rs cr)
30/11/2015
-930.86
626.40
01/12/2015
-144.05
165.50
02/12/2015
235.56
-85.10
03/12/2015
-535.75
301.90
04/12/2015
-1746.97
740.60
07/12/2015
-42.15
148.00
08/12/2015
-443.23
125.20
244.60
01/12/2015
597500000
1738272
2994.91
02/12/2015
795200000
1813447
3030.55
03/12/2015
354600000
1819565
3096.3
04/12/2015
471700000
1659359
2989.76
07/12/2015
365200000
1498349
2663.22
08/12/2015
526700000
1545384
2763.41
09/12/2015
-452.15
09/12/2015
291200000
1578946
2604.12
10/12/2015
-383.85
230.60
10/12/2015
281100000
1468973
2466.65
Fortnight
-4443.45
2497.70
11/12/2015
339800000
1616482
3853.37
Calendar 2015
-6216.58
69524.70
Net turnover in Rs crore. BSE data
FPIs: Foreign portfolio investors. MFs: Mutual funds
Trending
Advances and declines of traded scrips
DATE
SCRIPS ADVANCE DECLINE UNCHANGED

TRADED
30/11/2015
3078
1701
1159
218
01/12/2015
3139
1739
1245
155
02/12/2015
3087
1553
1383
151
03/12/2015
3081
1319
1622
140
04/12/2015
3069
1214
1674
181
DATE
07/12/2015
08/12/2015
09/12/2015
10/12/2015
11/12/2015
BSE data
SCRIPS ADVANCE DECLINE UNCHANGED

TRADED
3093
3081
3069
3002
3025
1525
929
583
1913
1012
1392
1996
2323
907
1805
176
156
163
182
208
September 2014, with growth mainly driven

by pick-up in the manufacturing sector,
which has grown by 9.3% in Q2. The GDP
growth has shown a pick up from 7% growth
recorded in Q1 June 2015. The finance
ministry is expecting the economy to grow
in the vicinity of 7.5% in the year ending
March 2016 (FY 2016).
The index of eight core industries
comprising nearly 38% of the weight of items
included in the index of industrial production
rose 3.2% in October 2015 over October
2014, data showed.
Meanwhile, the outcome of a monthly
survey on 1 December 2015 showed tepid
growth in Indias manufacturing sector last
month. The seasonally adjusted Nikkei India
Manufacturing Purchasing Managers Index
(PMI) fell to a 25-month low of 50.3 in
November 2015. The seasonally adjusted
Nikkei Services Business Activity Index fell
to 50.1 in November from Octobers eightmonth high reading of 53.2, pointing to
slowdown in growth in Indias services
sector, data showed on 3 December 2015.
The reading of 50 separates contraction from
expansion. Services companies displayed a
lack of optimism with regards to the 12month outlook for activity, as sentiment
dropped to the lowest in the 10-year survey
history. Difficult economic conditions and
weak demand reportedly hit confidence.
On political front, no major work could
be carried out during the ongoing winter
session of Parliament amid continuous ruckus
being created by the Opposition. The latest
row in parliament stemmed from a New Delhi
judges order that Congress president Sonia
Gandhi and her son Rahul must appear in
court in person on 19 December 2015, in a
case brought by BJPs Subramanian Swamy.
The Union Cabinet chaired by the Prime
Minister Narendra Modi approved the Real
Estate (Regulation and Development) Bill,
2015, as reported by the Select Committee
of Rajya Sabha on 9 December 2015. The
Bill will now be taken up for consideration
and passing by the Parliament.
Indirect tax revenue (provisional)
collections have increased from Rs 44475
crore in November 2014 to Rs 55297 crore
in November 2015, registering an increase
of 24.3%, data showed on 9 December 2015.
This is an achievement of 67.8% of the target
fixed for budget estimate 2015-16.
Meanwhile, data on 11 December 2015
showed the water storage available in 91
major reservoirs of the country as on 10
75
MarketWatch
December 2015 was 80.263 BCM which is
51% of total storage capacity of these
reservoirs. This was 80% of the storage of
corresponding period of last year and 76%
of storage of average of last ten years.
Asias developing economies remain on

track to post growth of 5.8% in 2015 and
6% in 2016, as the regions economies remain
resilient to continued economic weakness in
industrialized countries, says a new Asian
Taking off
BSE 500 companies hitting life-time highs in the fortnight ended 11 December 2015
STAKE
COMPANY
ALL-TIME ALL-TIME 52-WEEK PROMO.

HIGH-DATE HIGH(Rs) LOW (Rs)
(%)
FII TTM SALES TTM RPAT

(%)
VAR(%) VAR(%)
P/E
P/BV
Trent*
01/12/2015
1644
1095
32.61
18.67
11
-53
251.64
3.53
Granules India
01/12/2015
164.45
70.82
48.43
7.25
13.64
15.16
29.81
6.66
Rajesh Exports
01/12/2015
729
136.1
53.89
16.94
152.12
108.29
22.49
5.98
The Ramco Cement*
02/12/2015
384
270
42.3
13.74
-2
100
24.64
3.31
Kajaria Ceramics
02/12/2015
960
540.8
47.18
24.39
15.6
34.98
37.32
10.19
Take Solutions
02/12/2015
210.5
49.6
68.36
1.59
17.65
92.89
19.75
4.07
Godfrey Phillips*
03/12/2015
1660.25
411
72.06
9.82
-1
-22
44.97
5.48
SJVN*
04/12/2015
30.3
22.1
89.97
2.14
-1
-5
7.06
1.17
Petronet LNG*
04/12/2015
247
160
50
22.45
-17
32
19
Aegis Logistics
07/12/2015
115.9
39.77
62.93
2.92
-46.69
62.79
31.45
8.27
Jubilant Life
07/12/2015
455
116.1
54.03
17.56
0.6
80.14
23.06
2.76
T.V. Today Netw.*
07/12/2015
309.9
165.15
57.42
0.02
12
-6
21.21
3.73
Dalmia Bhar.
07/12/2015
805
400
62.79
7.86
75.34
-274.12
56.84
1.98
Ashok Leyland*
30/11/2015
99.65
43.2
38.82
20.6
56
163
7.05
BSE 500 companies hitting life time lows in the fortnight ended 11 December 2015
IL&FS Transport
10/12/2015
76.85
223.48
70.79
7.81
2.7
-39.87
9.3
0.43
T B Z*
10/12/2015
86.6
187.8
74.12
15.87
-51
36.74
1.32
PMC Fincorp*
11/12/2015
103
16.6
59
-100
Trinity Tradeli.*
11/12/2015
41
34.28
64
-159
* Results are based on standalone basis. For others on consolidated basis. Results for the year ending 30 September 2015.
Global equity markets

Returns in local currencies
COUNTRY
INDEX
Australia
Brazil
China
France
India
India
Japan
Mexico
New Zealand
Singapore
South Korea
United Kingdom
Germany
USA
USA
Russia
UAE
ASX 200
Bovespa
Shanghai Composite
CAC 40
BSE Sensex
Nifty
Nikkei 225
IPC
NZX 50 Index
Straits Times
KOSPI
FTSE 100
DAX
Dow Jones
S&P 500
MICEX
ADX General
FORT 1 MNTH 3 MNTHS 1 YEAR

-3.3
-1.3
-0.1
-7.7
-4.1
-4.2
-3.3
-5.1
-0.5
-0.9
-4.0
-6.6
-8.4
-3.1
-3.7
-4.2
-3.2
As on 11 December 2015. Returns in percentage.
76
-0.4
-2.7
-4.1
-5.4
-2.2
-2.0
-1.9
-3.7
1.4
-3.1
-1.3
-2.7
-3.4
0.1
-0.5
-0.5
-2.7
-0.8
-2.5
7.3
0.0
-2.2
-2.3
5.3
-1.8
7.5
-1.8
0.4
-2.7
2.1
5.1
2.6
0.1
-9.9
-3.9
-5.7
16.9
5.2
-8.4
-7.5
10.7
0.7
10.3
-14.7
1.7
-5.5
7.8
-0.1
0.5
17.9
-6.5
Returns in US dollars
FORT 1 MNTH 3 MNTHS 1 YEAR

-2.2
0.1
-0.8
-3.8
-3.9
-3.9
-2.3
-8.3
2.6
-0.1
-6.6
-5.9
-5.4
-3.1
-3.7
-7.5
-3.2
1.7
-1.2
-5.0
-3.5
-3.1
-2.8
-1.0
-6.6
4.5
-1.7
-2.0
-3.2
-1.7
0.1
-0.5
-3.3
-2.7
1.8
-0.4
6.3
-1.9
-2.7
-2.8
4.4
-4.0
14.6
-1.2
0.9
-4.4
-1.4
5.1
2.6
-1.2
-9.9
-15.3
-33.9
12.4
3.4
-14.3
-13.4
8.0
-14.9
-4.7
-20.2
-4.9
-8.9
-5.3
-0.1
0.5
-6.4
-6.5
Development Bank report. Growth in India

is expected to pick up further in the second
half of fiscal 2016 to reach 7.4% in FY 2016
and 7.8% in FY 2017 as envisaged in the
update on 3 December 2015.
On global front, the European Central
Bank (ECB)s stimulus package fell well
short of markets high expectations. The euro
region central bank cut its deposit rate deeper
into negative territory and extended its asset
buys by six months, as expected. ECB
President Mario Draghi after a policy meet
on 3 December 2015 announced the central
bank would extend its massive 60 billion
euro ($63.5 billion) a month bond-buying
scheme to at least March 2017. The ECB
cut its deposit rate further into negative
territory by 10 basis points to a fresh low
of -0.3%, down from -0.2%.
Chinas official reading on factory
activity fell to 49.60 in November 2015 from
49.80 in October 2015, data showed on 1
December 2015. The Caixin China
manufacturing purchasing managers index,
a private gauge, rose to 48.60 in November
2015 from 48.30 in October 2015. A reading
below 50 indicates contraction.
Chinas exports fell a worse-thanexpected 6.8% last month from a year earlier,
a fifth straight month of decline. Imports
fell 8.7%, a thirteenth straight monthly drop.
The trade data was announced on 8
December 2015.
Outlook
Macroeconomic data, proceedings of the
winter session of Parliament, investment by
FPIs, the movement of rupee against the
dollar and crude oil price movement will dictate trend on the bourses in the near term.
Investors focus is on whether the GST
constitutional amendment bill will be passed
in the Rajya Sabha. The constitutional
amendment bill for the implementation of
GST, which subsumes all indirect taxes to
create a unified market across the country,
has been cleared by the Lok Sabha and is
awaiting legislative passage in the Rajya
Sabha. A constitutional amendment bill
requires a majority of two thirds in the house
for its passage. The BJP-led NDA has a
comfortable majority in Lok Sabha, but lags
in numbers in the Rajya Sabha.
The next major trigger for the market is
Q3 results of India Inc. The result season
will start in the second week of January 2016
and will end mid February 2016.
Amit Shenai
MarketWatch
MarketWatch
Sizzlers and dampeners

Movements in mid-cap stocks# as on 11 December 2015
COMPANY (FV)
SECTOR
Sequent Scientific* (Rs 10)
Pharmaceuticals
Beta: 1.13
T.V. Today Network (Rs 5)

Media - Print/TV/Radio
Beta: 1.36
Bhushan Steel (Rs 2)

Steel
Beta: 0.92
Ashoka Buildcon*(Rs 5)
Infra Developers & Op
Beta: 1.01
Texmaco Rail & Engg (Re 1)

Capital Goods-Non Elect Equip
Beta: 1.13
BF Utilities (Rs 5)
Power Generation & Distr
Beta: 1.82
Man Infraconstruction*(Rs 2)
Construction
Beta: 1.67
Coromandel International*(Re 1)
Fertilizers
Beta: 0.46
CMP
(Rs)
MCAP
(Rs cr)
1167
5228
VARIATION (%)
HOLDING(%)
FORTNIGHT 1-YEAR PROMOTERS DOM. & FII
21
129
57
25
REPORT PAT % CHG

RATIOS
TTM QUARTERLY DEBT-EQUITY INT COVER
-63
-93
The integrated pharmaceutical companys subsidiary Alivira Animal Health (Alivira) forayed into the
European veterinary pharmaceutical markets through acquisition of three companies: N-Vet AB,
Fendigo SA & Fendigo BV. Alivira has acquired 85% stake in these three companies with the current
management retaining the balance stake.
282
1681
31
57
-6
84
84
The Reserve Bank of India notified that foreign institutional investors and registered foreign portfolios
investors can now invest up to 26% of the paid up capital of the news broadcasting operator under the
portfolio investment scheme. The purchases could be made through primary market and stock exchanges.
45
1024
-53
59
346
-147
The steel maker is reportedly in the process of getting Rs 3000 crore from sale and lease-back
arrangements for two of its assets in Odisha.
194
3635
50
57
30
591
Jaora-Nayagaon Toll Road Company (JTCL), one of the associates of the highway concessionaire,
completed refinancing of its debt of Rs 552 crore with State Bank of India. After refinancing, the
interest cost has been reduced to 9.8% per annum (p.a.) resulting in a saving of 1.5% p.a.
148
3109
18
55
34
-440
-29
The total rail solution companys consortium with three other companies Hitachi Japan, Mitsui & Co and
Hitachi India won a contract for designing and constructing signal and telecom works for dedicated freight
corridor traversing Indias biggest industrial cluster between Delhi and Mumbai. The order was placed by
Dedicated Freight Corridor Corporation of India. The sector covered by the contract, which is worth approximately Rs 1800 crore, will cover the 915 kilometre distance between Rewari in Haryana and Vadodara in
Gujarat. The project will be completed within 338 weeks (approx. 6.5 years) from start of work.
605
2279
66
312
91
Net profit of the infrastructure firm jumped 90.6% to Rs 8.12 crore on 3.1% growth in net sales to Rs
9.89 crore in Q4 September 2015 over Q4 September 2014.
42
1035
-3
49
66
-77
-103
A promoter, Mansi Parag Shah, pared her stake to 15.35% by offloading 1.6 crore shares, or approximately 6.5% stake, in the construction company worth approximately Rs 74.90 crore to be used
principally for various philanthropic activities. The shares were purchased by investors including
Reliance Capital and Vanaja Sundar Iyer.
184
5373
-4
-42
62
13
-3
-4
Complex fertilizer manufacturing unit of the fertilizer company at Ennore in Tamil Nadu was shut
down due to flooding in and around the plant.
77
MarketWatch
COMPANY (FV)
SECTOR (Ind No.)
Welspun Corp* (Rs 5)
Steel
Beta: 1.62
SRF (Rs 10)

Textiles
Beta: 1.28
Just Dial (Rs 10)

Miscellaneous
Beta: 1.04
Cox & Kings*(Rs 5)

Miscellaneous
Beta: 0.70
CESC (Rs 10)

Power Generation & Distr
Beta: 0.95
Bata India (Rs 5)

Leather
Beta: 0.89
NIIT*(Rs 2)
Computer Education
Beta: 1.29
CMP
(Rs)
MCAP
(Rs cr)
103
2711
VARIATION (%)
HOLDING(%)
FORTNIGHT 1-YEAR PROMOTERS DOM. & FII
-4
39
41
14
REPORT PAT % CHG

RATIOS
TTM QUARTERLY DEBT-EQUITY INT COVER
-487
1826
The complete pipe solutions provider has reportedly roped in investment bank to help sell its
renewable energy business. The move is aimed at trimming debt amid weakening business margins due
to consistent fall in solar power prices.
1189
6830
-5
39
52
28
28
The operations at the chemical-based industrial intermediates manufacturers plant located at Manali
Industrial Area in Chennai, Tamil Nadu, was disrupted due to flooding of the factory premises caused
by incessant rains. The factory was shut down after midnight of 1 December 2015.
889
6271
-6
-36
33
43
29
47
A foreign broker downgraded shares of the local search services provider stock to sell on worries
about the companys new Android app Search Plus execution risks. The broker expects core search
revenue growth to decelerate to 19% from the period from year ended March 2015 (FY 2015) to FY
2018 due to inadequate investments in the past and rising competition.
238
4036
-6
-12
49
38
1537
225
The travel services provider through its Holidaybreak Plc subsidiary sold 100% of the issued and
outstanding shares of Explore Worldwide for GBP 25.8 million to Hotelplan UK Group. The sale of
Explore Worldwide business helps the company to further increase focus on its three key verticals:
leisure, education and hybrid hotels (Meininger).
518
6868
-6
-21
50
39
New Rising Promoters, a subsidiary of the integrated electrical utility company, won the bid
floated by the Board of Control for Cricket in India (BCCI) for acquiring the rights and obligations to operate the Pune franchise of the Indian Premier League for two years. Meanwhile,
CESC executed a memorandum of understanding with US-based Silver Spring for exploring
business opportunities in India in the space. Silver Spring is a market leader in the smart-grid
space across the globe.
468
6014
-6
-29
53
27
26
39
20
A foreign broker downgraded the shares of the footwear maker to reduce from buy due to long-term
structural issues. In order to account for subdued demand, increasing competition and internal issues,
the foreign broker lowered sales growth forecast of the company for the fiscal year ending March 2016
(FY 2016). Given the intense competition from foreign players as well as new players from the ecommerce channel, it might be tough road ahead for Bata India.
92
1515
-6
71
34
22
-536
102
-4
The software firm entered into a strategic partnership with HP for offering post-graduate certificate
program in software testing to enable students to understand the intricacies of software testing and
quality assurance, unified functional testing essentials, application lifecycle management and
LoadRunner essentials.
# Mid-cap stocks with market capitalisation above Rs 1000 crore and below Rs 8000 crore. *consolidated. Beta is a measure of a stocks volatility in relation to the key benchmark index. Higher the beta of the
stock, higher will be the volatility in the stock price and, hence, riskier the investments. The beta of the index or the market is pegged at 1. Interest coverage ratio (ICR) is a measure of a companys ability to meet
its interest payments on outstanding debt. Higher the ICR, higher is the ability of the company to service its outstanding debt. % change in RPAT is change in the quarter and TTM ended 30 September 2015
over the previous corresponding periods. Promoters, domestic and FII shareholding is as on 30 September 2015. D/E and ICR is of the latest financial year.
Compiled by Hitesh Dharawat

78
OverTheCounter
MarketWatch
Insider deals
RPower, Titan
see promoter
rejig holding
Citigroup picks Unitech,
and Jamna Auto and offloads
Havells India
Promoter group entity Reliance Infrastructure proposed to acquire upto 2.80 crore
shares constituting up to 1% equity of Reliance Power from another promoter group
entity Reliance Infradevelopment on or after
7 December 2015 at market determined price.
Post acquisition, Reliance Infrastructures
stake increases to 62.59% from existing
61.59%. Reliance Infra developments stake
comes down to 12.39% from existing 13.39%.
Promoter group Tata Sons proposed to
acquire 19.09 lakh shares representing 0.22%
stake of Titan Company from another
group firm Tata International on or after 11
December 2015 at market determined price
as part of restructuring investment portfolio
of Tata Sons. Post acquisition, Tata Sons
stake rises to 19.8% from existing 19.59%.
Bulk Deals
Citigroup Global Markets Mauritius
offloaded 61 lakh shares of Havells India
at Rs 292.03 per share in a bulk deal on the
NSE on 3 December 2015.
Havells India had on 10 December 2015
said that wholly owned subsidiary, Havells
Holdings, Isle of Man, proposes to enter
into definitive agreement with Shanghai Feilo
Acoustics Co (Feilo) to divest 80% stake in
Havells Sylvania Malta BV. Havells Holding,
Isle of Man, will continue to hold the
remaining 20% stake with exit options in
next three-five years. Havells India also
proposes to divest 80% stake in its whollyowned subsidiary, Havells Exim, Hong
Kong. The combined equity value for 100%
stake for both these companies is 186 million
euros or about Rs 1340 crore as against
Havells cumulative investment value of
Rs 980 crore.
bought 1.45 crore shares of Unitech at Rs
6.99 per share in a bulk deal on the NSE on
30 November 2015.
Ticker trade
Companies witnessing big-ticket transactions
HOLDING (%)
COMPANY
52-WEEK (Rs)
CMP (Rs) PROMOTER INSTITUTION
HIGH
Reliance Power
48.3
74.98
10.22
66.9
Titan Company
353.05
53.05
25.27
448
Havells India
301.05
61.63
26.77
315.65
Unitech
6.3
31.29
19.57
22.75
Tree House Education
190.45
29.97
24.81
548
Visa Steel
17.31
67.2
18.33
25
Ess Dee Aluminium
271.2
57.97
19.06
397.7
Mangalam Cement
203.2
27.59
14.36
348
Donear Industries
23.56
75
7.47
25.65
Rallis India
165.55
50.09
22.59
298.5
Jamna Auto Industries
118.6
43.81
0.37
137.5
Kridhan Infra
99.75
65.11
1.32
106.45
Just Dial
889.25
32.58
42.64
1631.7
APL Apollo Tubes
614.25
42.37
22.88
633
CMP: Current market price as on 11 December 2015. Holding as on 30 September 2015
Morgan Stanley Asia (Singapore) Pte

bought 2.40 lakh shares Tree House
Education & Accessories at Rs 166.56 per
share in a bulk deal on the NSE on 1
December 2015. Macquarie Fund through
its two schemes sold a total of 11.94 lakh
shares of Tree House Education &
Accessories at Rs 160.69 per share in bulk
deals on the NSE on 1 December 2015.
Cresta Fund purchased 33 lakh shares
of Visa Steel at Rs 15.10 per share from
Visa Infrastructure in a bulk deal on the NSE
on 2 December 2015. Promoter group entity
Visa Infrastructure held 45.58% stake in Visa
Steel as per the shareholding pattern as on
30 September 2015. Cresta Fund held 3.79%
stake in Visa Steel as per the shareholding
pattern as on 30 September 2015.
Standard Chartered Bank (Mauritius)
offloaded 1.73 lakh shares of Ess Dee
Aluminium at Rs 306 per share in a bulk
Selling high, buying low

ICICI Prudential Mutual Fund purchased
Rallis India at Rs 170 per share in a bulk
deal and Amansa Holdings offloaded at
Rs 170.04 per share and Rs 171.79 per share
140
130
Rallis India
120
110
100
BSE Sensex
90
80
70
D J'15
Base=100 as on 11 December 2014

Face Value: Re 1.
D *
* 11 December 2015
VARIATION (%)
LOW
FORTNIGHT
1 YEAR
33.05
303
235.6
5.4
138.1
13
121
189.2
9.28
163.5
65
51
741.1
309.9
-5.47
-7.07
4.78
-9.35
12.69
17.35
-9.75
4.74
59.08
-10.68
2.19
10.4
-5.55
8.23
24.24
-8.2
6.77
-64.51
-58.51
-6.94
-24.77
-34.67
17.8
-22.5
54.63
48.44
-36.04
72.54
deal on the NSE on 2 December 2015.

Macquarie Emerging Markets Asian Trading
Pte was the buyer.
Tata Investment Corporation sold 1.78
lakh shares of Mangalam Cement at Rs
200 per share in a bulk deal on the NSE on 4
December 2015.
Merrill Lynch Capital Markets Espana
SA SV sold 5.51 lakh shares of Donear
Industries at Rs 19.99 a piece in a bulk deal
on the BSE on 7 December 2015.
ICICI Prudential Mutual Fund purchased
25.49 lakh shares of Rallis India at Rs 170
per share in a bulk deal on the BSE on 8
December 2015. Amansa Holdings offloaded
42.92 lakh shares of Rallis India at Rs 170.04
per share and sold another 17.97 lakh shares
of the company at Rs 171.79 per share on
the BSE on 8 December 2015.
bought 7.79 lakh shares of Jamna Auto
Industries at Rs 125.98 per share in a bulk
deal on the NSE on 8 December 2015.
Elara India Opportunities Fund bought
four lakh shares of Kridhan Infra at Rs
94.50 per share in a bulk deal on the BSE on
10 December 2015.
Sequoia Capital India Investments III
offloaded 11.12 lakh shares of Just Dial at
Rs 900 per share in a bulk deal on the NSE
on 11 December 2015. Amansa Holdings
bought 10.56 lakh shares of Just Dial at Rs
899.99 per share.
FIL Investments (Mauritius) offloaded
1.57 lakh shares of APL Apollo Tubes at Rs
613.83 per share in a bulk deal on the NSE
on 11 December 2015.
Compiled by Chaitanya Nallani
79
ApnaMoney
ApnaMoney
Taxation
Healthy and wise

The waiting period for critical illness is 90-120 days and survival
should be at least a month after the procedure to get claim
Due to increasing healthcare costs, buying
health insurance has become important for
financial planning. A health insurance policy
provides protection against expenses arising out of medical emergencies. Various
health insurance schemes are available. Policies from different insurers have different
features, riders and premium. It is difficult
to pick the right one that suits ones needs
and budget.
Ensure that the health insurance policy
provides adequate coverage (sum insured)
Ensure that all members of the family are
covered. Do not sacrifice on sum insured
just to save money on premium. For the
same sum assured, premiums vary across
different insurance companies. Instead of
simply going for the cheapest plan, compare
features. By paying a little extra, one may
be able to get greater benefits.
Every health insurance company has a
waiting period before it starts covering preexisting diseases. According to the
Insurance Regulatory and Development
Authority, a pre-existing disease is any
condition, ailment, injury or related
condition for which one had signs or
symptoms, were diagnosed, or received
medical advice or treatment within 48
months prior to the purchase of the policy.
80
Cap on room rent

Give preference to policies that have a
lower waiting period.
Many health insurance policies offer a
critical illness rider along with the basic
policy, covering a limited number of diseases
for which usually the cost of treatment is
very high. Closely scrutinize the diseases
that are covered by the rider. Ensure that
diseases for which there is a higher degree
of susceptibility in ones familys medical
history should be included.
A critical illness rider mostly covers
expenses arising out of cancer, kidney
failure, organ transplant, multiple sclerosis
and coronary artery surgery.
Opt for cashless facility, where the
insurer reimburses the hospital directly, as
it involves less paperwork and hassle. Also,
check the network of hospitals in your city

where the cashless facility is available.
If you have had a claim-free year,
companies offer a certain per cent bonus on
sum assured the following year. The
cumulative bonus could go up to 50% of the
sum assured. Make sure that your insurer
offers you this bonus.
Usually persons aged above 45 are
required to go through a medical check-up
before the insurance company agrees to cover
them. If your medical report is adverse, you
may not be issued a policy. The age limit
varies from company to company. The
higher is the better.
Some insurance companies have designed
policies to cater to the needs of senior citizens.
Some insurers offer policies renewable up to
the age of 75 years, provided the insured had
bought the policy before the age of 55. The
longer is the period for which a senior citizen
cover lasts, the better.
Insurance companies have a cap on room
rent, usually 1% of sum assured per day.
This figure varies from companies to
company. One general insurance company,
for instance, reimburses up to 1.5% of the
sum insured per day. Another pays up to
Rs 1500 per day, depending on the city.
While selecting the right critical illness
cover, ask specifically the diseases that are
covered. For example, procedures
like angioplasty are not covered under critical
illness. Also remember that the waiting
period for critical illness is usually 90-120
days and you must survive for at least a
month after the procedure to get the claim.
Tushar Doctor
ApnaMoney
Investment Strategy
Investment Strategy
Keeping a check on inflows

If sales are happening but an enterprise is not able
to recover money from customers, it is a sign of trouble
Investors tend to focus on profit and loss
(P&L) accounts more than on balance sheets.
The cash-flow statement is largely ignored
by the retail individual investors. This is
not a prudent practice. Equal importance
should be given to all the three financial
statements. The order of priority should be
the balance sheet, followed by P&L account
and then cash flow. Just like profit or loss
figures, a close scrutiny of the balance sheet
and cash flow statement is a must while
exploring stocks for investment.
The retail investors have no access to
insider information. Institutional investors
can be seen dealing in stocks based on interaction with the management. For instance,
mutual funds selling stocks without any
apparent reason is common. Subsequently,
the real motive emerges for pressing the exit
button. In the meantime, the retail investors
remain clueless. Stock market regulator Securities and Exchange Board of India can be
seen handling several cases of insider trading and market manipulation.
In such a scenario, investors have to
learn to play the game on the basis of publicly available information. Yes, whether the
financial statements are reliable remains a
moot question. A quick glance at the ratios
could be of immense help to assess the fiDec 21, 2015 Jan 03, 2016 CAPITAL MARKET
nancial health of companies. Any doubts or

contradictions highlighted by the ratios
should be adequately probed.
The debtors-to-turnover ratio throws
light on the quality of the top line. If sales
are happening but an enterprise is not able
to recover money from customers, it is a
sign of trouble. This ratio is determined as
turnover divided by sundry debtors or
trade receivables.
A low debtors-to-turnover ratio means
capital is locked up in trade receivables. It
indicates the firm is taking too much time
to recover money from its customers.
Moreover, certain debtors could be not realizable at all. On the contrary, a high debtors-to-turnover ratio is an indicator of
quick realization of money from customers. It signifies the money stuck with customers is insignificant.
There are several possibilities about why
the debtors-to-turnover ratio is low. It might
be due to poor business practices of collection of trade receivables. Also, there might
be disputes with clients resulting into accumulation of trade receivables over a period
of time. This problem is particularly faced
by companies operating in the infrastructure and construction sectors. In a worstcase scenario, the low debtors-to-turnover
ratio might be owing to manipulation of the

top line to paint a healthy picture to keep
the stock market in good mood.
Importantly, this ratio should be monitored taking into account various perspectives. A consistently low ratio is not a
healthy sign. There might be firm-specific
issues or due to nature of business.
A decline in this ratio over a period of
time is a signal of brewing trouble. Investors should search for adequate explanations for this trend. There might be change
in credit policies towards customers, disagreements or disputes leading in bunching up of trade receivables.
A low debtors-to-turnover ratio and
a high debt-to-equity ratio is a deadly
cocktail. Such companies are likely to
face cash crunch in running day-to-day
business operations.
In such a situation, annual reports are
helpful. In the annual reports, firms disclose debtors or trade receivables that are
outstanding for over six months in the
notes to accounts. Such overdue outstanding amounts can be compared with the
overall debtors to have a sense about the
gravity of the issue. A constant increase
in overdue amounts is a clear indication
about looming trouble.
Even the statutory audit reports give
insights about trade receivables. The audit
reports draw attention to overdue receivables and call for adequate provisioning.
Also, auditors tend to highlight disputes,
negotiations and litigations in their reports.
Balance confirmation from clients is another
frontier covered by auditors. Investors
should knit together the information that is
available in bits and pieces to draw a complete picture.
Capital Market had a look at the debtors-to-turnover ratio to pick companies
with low ratio or those reporting decline in
the ratio over the last one decade. For this,
companies whose latest annual financial
results March 2015 and beyond were
available were considered. Banks and financial services were removed from the
database. Eventually, there were 50 companies with low or deterioration in the debtors-to-turnover ratio.
Jyoti Structures had trade receivables
of Rs 3585.2 crore in the consolidated
books of accounts end March 2015. Net
sales were Rs 3111.4 crore in the financial
year ended 31 March 2015 (FY 2015).
81
ApnaMoney
Investment Strategy
Capital blockage
Companies with low debtors-to-turnover ratio or those reporting decline in the ratio over the last one decade
COMPANY
CMP
(Rs)
MCAP
(Rs cr)
52-WEEK
HIGH
LOW
(Rs)
(Rs)
MF
P/E
(%) RATIO
C Mahendra Exports
1.3
15.6
8.9
1.2
Sujana Universal
1.4
23.5
2.5
1.0
Ind-Swift
6.0
29.0
8.0
4.0
0.01
Alchemist
24.0
32.5
45.5
20.0
0.04
Bartronics India
11.8
40.3
16.5
7.9
Simplex Projects
BVPS
(Rs)
FY
DEBT NET SALES

(Rs cr)
(Rs cr)
D-E DEBTORS DEBTORS-TORATIO

(Rs cr) TURNOVER
(TIMES)
RATIO
0.1
98.6
201503
1165.4
583.5
2.05
1604.3
0.0
48.4
201503
976.5
5280.2
1.13
4089
1.29
0.0
-12.0
201503
1039.6
417.2
29.76
485.5
0.86
0.0
63.7
201503
720.4
349.7
6.76
474.2
0.74
0.0
76.8
201503
624.6
108.2
2.12
1067.8
0.1
0.59
0.36
29.6
37.3
51.2
19.9
0.0
144.6
201503
470.6
530.7
2.31
904.3
Sujana Metal Products
2.6
51.4
4.6
2.0
4.9
43.9
201503
1591.7
3942.5
1.83
3066.3
1.29
Goenka Diamond
1.5
46.6
2.7
1.1
65.3
10.5
201503
161.6
102.5
0.48
711.5
0.14
Parabolic Drugs
8.7
53.9
15.6
6.9
0.0
-37.2
201503
957.3
232.1
98.2
2.36
Everonn Education
27.1
65.2
42.5
19.1
0.0
-54.9
201503
865.9
32.6
188
0.17
Bafna Pharmaceuticals
38.9
72.5
47.5
23.9
0.0
38.5
201503
68.7
97.7
1.26
88.7
1.1
Shree Ganesh Jewellery
9.5
68.6
29.0
9.1
0.0
32.7
201503
3166.9
310.8
5.13
3306.1
0.09
PSL
11.1
109.5
18.4
7.3
0.0
-76.7
201503
5013.6
299.5
399.5
0.75
Lakshmi Energy & Foods
12.1
80.2
15.6
8.2
0.0
63.0
201503
951.2
616.9
1.53
369.7
1.67
Satra Properties (India)
5.4
97.0
12.3
4.1
0.0
4.7
201503
491.1
30.8
4.88
121.7
0.25
Avon Lifesciences
40.1
90.2
62.0
10.0
0.0
23.6
201503
179.2
103.2
2.56
189.6
0.54
Easun Reyrolle
38.3
117.9
68.0
34.0
12.23
0.0
51.7
201503
223.3
117.9
1.47
283.3
0.42
Ind-Swift Laboratories
30.8
126.2
44.8
22.1
0.0
67.3
201503
1419.8
660.5
4.09
389
1.7
Premier
42.0
128.0
66.0
32.0
0.04
0.0
78.0
201503
357.2
167
1.54
130.7
1.28
Unity Infraprojects
13.1
147.5
28.5
9.8
0.0
54.2
201503
2810.2
1098.1
3.62
1033.8
1.06
Jyoti Structures
15.8
172.5
43.5
10.8
20.93
0.0
35.3
201503
2916.7
3111.4
3.93
3585.3
0.87
Educomp Solutions
13.1
160.3
30.7
9.5
0.0
47.2
201503
3838
518.2
2.52
1643
0.32
164.1
172.1
211.0
120.0
20.9
209.9
201503
104.9
420.1
0.43
267.7
1.57
Technofab Engineering
Ramky Infrastructure
30.8
175.9
55.8
23.6
1.86
0.0
140.2
201503
3670.8
1644.1
3.4
979.2
1.68
Dolphin Offshore Enterprises
115.7
194.0
210.7
82.0
3.6
233.2
201503
66.1
49.8
0.4
175.1
0.28
CMI FPE
401.0
198.0
557.0
340.0
52.0
280.0
201503
25.3
219.3
0.22
131.8
1.66
Allied Digital Services
45.0
207.8
56.4
15.0
21.0
143.2
201503
136
233.8
0.18
312
0.75
EMCO
29.1
196.3
45.4
20.0
4.59
0.0
69.8
201503
689.6
970.9
1.34
607.5
1.6
Kalindee Rail Nirman (Engineers) 133.0
219.0
172.0
99.0
0.03
0.0
98.0
201503
180
308.5
0.84
244.7
1.26
Genesys International
69.0
209.0
91.0
42.0
0.02
35.0
63.0
201503
11.6
60.3
0.05
56.6
1.06
137.1
248.6
179.0
101.0
2.62
22.3
186.9
201503
43.1
77.9
0.13
81.2
0.96
2.8
205.2
7.2
2.7
0.0
11.9
201503
3011.1
378.9
2.78
359.8
1.05
ABM Knowledgeware
250.0
250.0
315.0
126.0
14.0
86.0
201503
90.7
55.8
1.62
A2Z Infra Engineering
24.5
300.9
33.0
12.1
0.0
59.0
201503
1518.6
594.4
1.8
796.5
0.75
Supreme Infrastructure
146.1
375.5
305.4
110.1
6.13
0.0
329.1
201503
4184
1813.9
4.55
1034.1
1.75
TRF
373.2
410.5
491.0
183.3
0.0
-14.7
201503
601.8
1125.9
30.46
636.6
1.77
40.1
393.5
59.2
32.7
2.0
419.5
201503
8819
11481.1
2.14
9915.8
1.16
8.9
453.3
21.3
6.5
0.0
17.6
201503
9385.9
3819.5
6.52
1899.4
2.01
McNally Bharat Engineering
94.9
480.1
114.0
64.6
5.19
0.0
69.8
201503
1800.4
2429.7
4.72
1535.6
1.58
Peninsula Land
22.3
622.6
40.9
20.0
0.01
0.0
52.8
201503
2096
167
1.18
127.3
1.31
Elecon Engineering
81.0
882.5
97.0
44.6
4.71
27.9
49.2
201503
551.7
1328.9
1.11
858.2
1.55
National Fertilizer
26.0
1283.0
43.0
20.0
0.0
30.0
201503
7644.8
8519.7
5.11
5029
1.69
Career Point
Gujarat NRE Coke
Gitanjali Gems
IVRCL
82
ApnaMoney
COMPANY
Investment Strategy
CMP
(Rs)
MCAP
(Rs cr)
52-WEEK
HIGH
LOW
(Rs)
(Rs)
MF
P/E
(%) RATIO
BVPS
(Rs)
FY
DEBT NET SALES

(Rs cr)
(Rs cr)
D-E DEBTORS DEBTORS-TORATIO

(Rs cr) TURNOVER
(TIMES)
RATI
Bliss GVS Pharma
171.9
1772.3
210.9
58.8
30.3
32.7
201503
159.6
407.1
0.53
247.5
Omaxe
133.4
2439.9
140.0
123.0
34.6
108.1
201503
1095.9
1431.1
0.49
770
1.86
66.1
4862.7
85.0
36.7
1.35
0.0
26.4
201503
6893.1
922.7
2.9
875.7
1.05
347.5
7710.6
494.7
315.0
4.73
21.5
62.7
201503
874.3
2709.9
0.79
1432.2
1.89
28.8
11892.8
30.3
22.1
0.97
7.0
24.7
201503
2652
2817.4
0.27
1507.1
1.87
48.5
13590.8
66.9
33.1
1.05
11.1
73.6
201503 33218.5
6903.4
1.58
2910.7
2.37
1196.9 28725.6
1386.7
865.0
7.93
25.0
338.2
201503
25.3
7092.6
3805.3
1.86
299.5
164.1
1.95
29.7
139.8
201503
1886.8
31274.2
0.1
26520.1
1.18
Pipavav Defence & Offshore Engg

Inox Wind
SJVN
Reliance Power
Bharat Electronics
Bharat Heavy Electricals
169.0
41352.2
1.65
Consolidated financial considered wherever available. CMP (current market price) is close as on 9 December 2015 except C Mahendra Exports (26 November 2015) and CMI FPE (8 December 2015). MF (%) : Mutual
fund holding as of September 2015 except A2Z Infra Engineering (November 2015) . P/E: Price to earnings ratio. P/BV : Price to book value. Financial year ended March 2015. BVPS : Book value per share.
These figures are grossly odd. Debtors exceeds turnover. This abnormality has its
own ramifications.
These figures suggest that Jyoti has
managed to report sales but has not able to
recover money from clients on time. Aggregate trade receivables of Rs 3585.2 crore,
52.3% or Rs 1877.5 crore of the total trade
receivables, were overdue for more than six
months. This is a significant amount considering the net worth of Rs 386.1 crore
end March 2015 and market capitalization
of Rs 172.5 crore on 9 December 2015.
The debtors-to-turnover ratio stood at
mere 0.87 times.
Additionally, the statutory auditors
have expressed qualified opinion on trade
receivables. The auditors have stated in their
audit report for FY 2015 that the trade receivables end March 2015 included Rs 70.4
crore outstanding from a joint venture (JV)
company, Lauren Jyoti Pvt Ltd. Further,
Rs 55 crore was paid by Jyoti Structures on
account of bank guarantee encashed by a
customer of Lauren Jyoti. This amount was
debited to the JV. Also Rs 8.3 crore is other
outstanding from Lauren Jyoti.
The financial statements of the JV are
not available for FY 2014 and FY 2015.
Considering the fact that the financial statements of the JV are not available and it is
not regular in payment of the outstanding,
the auditors were not able to comment on
the recovery of the debt and its impact on
the financial statements of Jyoti Structures.
Jyoti Structures is reeling under heavy
debt of Rs 2916.7 crore and debt-to-equity
ratio of 3.93 times. The engineering, procurement and construction (EPC) player in
the power transmission sector incurred cash
losses in FY 2015. Mutual funds held
20.93% equity end September 2015.
Jyoti has been facing a significant lag

in sanction and release of assessed working capital facilities. This has resulted in
stress in cash flows and delay in project
execution and realization, leading to enlargement of debtors.
Easun Reyrolle is another extreme
case. Debtors at Rs 283.3 crore end March
2015 were 2.4 times FY 2015 consolidated
sales of Rs 117.9 crore. The debtors-toturnover ratio is dismally low at 0.42 times.
Of the total trade receivables, Rs 186.8
crore was outstanding for more than six
months. Additionally, Rs 7.8 crore was
outstanding for more than six months from
related parties. The aggregate outstanding
for over six months amounted to 68.7% of
the total trade receivables.
The auditors of Easun have drawn attention to several specific instances of trade
receivables, where provisions could be necessary. First, debtors included Rs 11.9 crore
Tough times
Easun Reyrolles debtors-to-turnover
ratio is 0.42 times. Of the total trade
receivables, Rs 186.8 crore was
outstanding for more than six months
Relative performance of
Easun Reyrolle v BSE Sensex
xxxxx
Face Value of Rs 2.
*11 December 2015
( Rs 10.1 crore in FY 2014) of liquidated

damages recovered by some customers. The
company is in the process of recovering the
amount and no provision was considered in
the books of accounts towards the liquidated
damages. In FY 2015, the company managed to get Rs 59.5 lakh from customers
against amount written off in the earlier
years. This amount was adjusted against the
liquidated damages recoverable.
Second, trade receivables included Rs
6.2 crore (Rs 3.9 crore in FY 2014) outstanding from foreign debtors for more than
one year. Easun is in the process of getting
the necessary approval from the Reserve
Bank of India towards extension of time
limit for collection. Out of this, Rs 5.1 crore
was received subsequently.
Third, certain turnkey projects were terminated by the customers, resulting in
encashment of bank guarantees amounting
to Rs 5.2 crore. These were shown as recoverable from parties. Negotiations with the
customers are in progress.
Last, confirmations had not been received in certain cases of balances in debtors and creditors accounts. Pending confirmation of balances and reconciliations,
the resultant impact on the financial statements including the operating results could
not be ascertained.
Easuns balance sheet was stretched with
debt of Rs 223.3 crore and debt-to-equity
ratio of 1.47 times end FY 2015. It raised Rs
58.9 crore through a rights issue priced at
Rs 59 last fiscal. The companys products,
systems, solutions and services find application in electrical power transmission and
distribution. Within the industry, the firm
focuses on protection and automation business. Mutual funds had 12.23% stake end
September 2015.
83
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Track record
Period ended Average Var (%)
31 Mar 2015 Telefolio

9
3 Months
6 Months
16
12 Months
46
24 Months
105
36 Months
119
60 Months
127
As on 15 April 2015
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Scrip
ITD Cementation
Rec.
Date
16-Apr-14
Rec. Cur. Price % Sensex

Price 15-04-15 Var Var(%)
149
760
410
29
Scrip
Rec.
Date
Hikal
11-Jun-14
Rec. Cur. Price % Sensex

Price 15-04-15 Var Var(%)
89
147
66
13
19
Astec LifeSciences
25-Jun-14
42
167
297
14
BASF India
30-May-14
793
1268
60
Apcotex Industries
14-May-14
129
502
289
21
ING Vysya Bank
31-Oct-14
644
1028
60
Hi-Tech Gears
07-May-14
86
315
266
29
Benares Hotels
11-Jul-14
910
1431
57
15
KEI Industries
20-Jun-14
24
84
251
15
Intl Travel House
23-Apr-14
174
273
57
26
JBM Auto
18-Jul-14
88
259
194
12
DCM Shriram Ind
11-Apr-14
54
83
54
27
Honeywell Auto
09-May-14
3182
8505
167
25
Morganite Crucible
01-Aug-14
382
590
54
13
Control Print India
27-Jun-14
90
226
151
15
WPIL
16-Jul-14
381
572
50
13
Roto Pumps
06-Jun-14
49
122
149
13
Lakshmi Electrical
02-Jul-14
329
487
48
11
Sterling Tools
09-Apr-14
127
294
132
27
Salzer Electronics
21-Nov-14
165
243
47
MBL Infrastructures
12-Sep-14
284
608
114
Rane Brake Lining
30-Jul-14
244
351
44
10
Garware-Wall Ropes 13-Jun-14
97
205
111
14
Modison Metals
18-Apr-14
33
47
44
27
Investment & Preci
13-Aug-14
57
119
109
11
Poddar Pigments
25-Jul-14
101
145
43
10
Career Point
04-Apr-14
81
168
108
29
Simmonds Marshall
13-Feb-15
71
99
40
-1
Mindtree
30-Apr-14
710
1428
101
28
Bajaj Corp
19-Dec-14
344
476
38
5
10
Alicon Castalloy
18-Jun-14
155
296
91
14
Everest Industries
23-Jul-14
242
327
35
Vishnu Chemicals
03-Sep-14
93
175
88
Foseco India
26-Nov-14
1007
1303
29
Nilkamal
16-May-14
233
431
85
19
D B Corp
28-May-14
296
382
29
17
KEI Industries
10-Dec-14
46
84
83
Rane (Madras)
06-Aug-14
307
389
27
12
CRISIL
02-May-14
1281
2298
79
29
Samkrg Pistons
26-Sep-14
145
180
24
ADC India Comm
03-Dec-14
219
388
77
PNB Gilts
05-Nov-14
25
31
24
Whirlpool of India
22-Oct-14
438
765
75
Rajoo Engineers
18-Feb-15
14
17
23
-2
Rajoo Engineers
10-Oct-14
10
17
72
10
Superhouse
22-Aug-14
188
231
23
Shivalik Bimetal
19-Sep-14
Maruti Suzuki India 21-May-14
19
33
71
Elantas Beck India
02-Jan-15
1039
1272
22
2168
3691
70
19
Bharat Seats
09-Jan-15
30
36
21
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ApnaMoney
Bliss GVS Pharma witnessed a decline
in debtors-toturnover ratio to 1.65 times
in FY 2015 and 1.60 times in FY 2014 as
against the median figure of 2.5 considering
the last 10 financial years. The company
reported a decade high debtors-to-turnover
ratio of 4.31 times in FY 2007. Consolidated trade receivables increased to Rs
247.5 crore end March 2015 as against Rs
215 crore a year ago. Out of consolidated
trade receivables of Rs 247.5 crore, Rs 87.7
crore ( Rs 82.4 crore in FY 2014) were outstanding for over six months. It is moderately leveraged, with a debt- to-equity ratio of 0.53 times, with debt of Rs 159.5
crore end FY 2015. However, the debt-toequity ratio has seen consistent increase
over the last five years.
Bliss reported robust growth over the
last five years, with sales increasing 2.4
times and profit 1.4 times between FY 2010
and FY 2015. The pharmaceutical company
is among the world leaders in the suppositories and pessaries dosage forms, with one
of the largest product portfolios in this segment. It is in the process of expanding its
capacities and acquired land in FY 2015.
Dolphin Offshore Enterprises trade
receivables declined a marginal 8% in FY 2015
to Rs 175.1 crore. However, the debtors-toturnover ratio deteriorated to 0.28 times from
1.88 times in FY 2014. This was primarily
owing to a sharp decline of 86% in turnover
to Rs 49.8 crore in FY 2015. A significant
quantum of debtors Rs 110.9 crore or 63%
of the total were outstanding for over six
months. Debtors outstanding for more than
six months were Rs 114.1 crore in FY 2014.
The firm incurred cash losses in FY 2015 and
FY 2014. Fortunately, it has moderate leverage, with debt of Rs 66.1 crore and a debt-toequity ratio of mere 0.40 times.
The auditors of Dolphin in their audit
report for FY 2015 have drawn attention to
three issues. First is the non-availability of
confirmations of balances of receivables and
payables. Considering the nature of projects
executed and the main customers, the consequential claims and counter-claims towards
liquidated damages and change order is a general practice prevalent in the industry. The
balances outstanding as trade receivables
including interest charged as per contract
terms, billable costs, advances to and balances payables towards contractors and vendors are not confirmed. The company has
initiated legal actions in some cases.
86
Investment Strategy
On a slippery path
PSLs debtors-to-turnover ratio
declined drastically to just 0.75 times
in FY 2015. It had consolidated debtors
of Rs 399.5 crore end March 2015
Relative performance of
PSL v BSE Sensex
xxxxx
Face Value of Rs 10.
*11 December 2015
Second, in FY 2010, Dolphin took extra time to complete an EPC contract beyond the scheduled completion date. This
was because the company had to execute
significant additional work and on account
of delays not attributable to it. The potential liability for liquidated damages resulting from the extended completion date
amounted to Rs 11 crore ( Rs 13.5 crore in
FY 2014). The liquidated damages are likely
to be waived and no provision was made
in the financial statement.
Third, in FY 2011, Dolphin incurred
additional expenditure on executing additional work for an EPC contract. It quantified and submitted some claims for extra
work done. The matter was referred to an
outside expert committee (OEC) for resolution. As a matter of caution, a portion of
these extra claims, amounting to Rs 19 crore
(Rs 19 crore in FY 2014), were recognized
as revenue. The balance will be recognized
as revenue as and when they are accepted
by the customer.
Last, Dolphin incurred additional expenditure on executing additional work of
another EPC contract. It quantified the
value of extra work at Rs 102 crore ( Rs
91.6 crore in FY 2014). The company has
commenced discussions with the customer
for finalizing the amount. Out of this, invoices for Rs 23.2 crore (Rs 21.8 crore in
FY 2014) were raised on the customer and
the balance amount of Rs 78.8 crore (Rs
69.8 crore in FY 2014) accrued on this account was included as other current assets.
The recognition of this revenue is subject
to the acceptance by the customer.
Among the select stocks, PSL is a classic example of notable decline in debtorsto-turnover ratio. The ratio declined drastically from 6.36 times in FY 2011 to just
0.75 times in FY 2015. It had consolidated
debtors of Rs 399.5 crore end March 2015
as against Rs 450.4 crore a year ago. Out
of these total debtors, over two-thirds of
trade receivables were pending for more
than six months.
As per the audit report on the standalone
books of accounts for FY 2015, PSL has not
produced confirmation of balances from sundry debtors confirming the amount outstanding end March 2015. In the absence of adequate evidence and information, the auditors were unable to comment on the financial
impact of this matter on the P&L account.
With a production capacity in excess of
the one million tonnes, PSL is among the leading producers of helical submerged arc welded
pipes. The company is under stress due to
fall in turnover, slowdown in economic environment, increase in the cost of production,
idle labor, lack of sufficient orders and reduced net realization as against increase cost
of sales. It is witnessing shortage of working
capital. The net worth was negative Rs 693.2
crore, with debt of Rs 5013.6 crore, end
March 2015. The lenders restructured the
debt under the corporate debt restructuring
mechanism in September 2013 and repayment of borrowings has been re-scheduled.
Real estate and construction company
Peninsula Lands case is somewhat similar to Jyoti Structures. Turnover was Rs
167 crore, while trade receivables were Rs
127.2 crore in FY 2015. The debtors-to-turnover ratio works out to 1.31 times. This is
considerably low. Worse, of these trade receivables, Rs 116.1 crore was outstanding
for more than six months since due.
Conclusion
Many of these companies are facing a diverse set of issues. These include dwindling sales, pressure on profitability, high
debt and cash crunch apart from the industry-specific issues. Several of them have
plunged to multi-year lows and, in a few
cases, even to their historic lows over the
last two years. In that sense, the market is
already well aware about their troubles.
Investors can monitor the debtors-toturnover ratio to confirm whether the situation
is improving or worsening.
S Khedekar
ApnaMoney
Investment Strategy
Money Matters
Why returns on
equity schemes
so low?
I started investing in equity mutual
funds since last year. I was told that I can
expect a return on investment of approximately 15% on an annualized basis. Its
been more than a year now and the return on investment has been not more
than 2% on an annualized basis. Should
I continue with the SIP? Can this investment deliver more than 8%? If not, I
can still switch to a recurring deposit
account. Should I choose a different
scheme if my fund is not delivering?
Rishubh_P@
Investing in equities or equity-linked investment is not as easy as investing in recurring

deposits. Equity investing demands a different temperament. First, return on investment can be high if the market rises at a
brisk pace. It can also slip if the markets
corrects. A three- to five- year investment
horizon is necessary for equity schemes to
generate decent returns. Returns might not
be much in the first year.
Historical evidence shows that equity
investments over more than five years generally beat returns from traditional instruments such as recurring deposits. Thus, if
your time horizon is long enough, you
should ignore the low or negative returns in
the short term and keep on investing for
better returns in the long run. If your horizon is short, you have invested in the wrong
Ulip v Term plan plus mutual fund
asset class and recurring deposit might be a

better option for you.
You should check the performance of
your fund with its benchmark. If it is generating better returns than the benchmark consistently, then you should stay invested with
the fund. If not, you can switch to a fund
that is consistently beating its benchmark
over various horizons.
Also, understand that a top-ranked fund
might not remain the best fund forever. But
if the fund is beating the benchmark by sizable margins, you should not think of shifting to another fund.
Recently, I redeemed my unit-linked insurance policy (Ulip) of Max Life due to
heavy administration charges. I had
bought this policy in 2005. I have got
nearly 7% returns from this policy.
These returns are very low compared
with my expectation. I am 45 years of
age and my wife is 40 years. We have a
17-year-old son. As I dont have any insurance now, please suggest me a Ulip
with lower administration charges.
Chintamani_11@
Ulips have been levying high charges, affecting the returns for investors even if they
Timing the exposure

Equity investments over more than five years generally beat returns from traditional
instruments such as recurring deposits
SCHEME NAME
SBI Small & Midcap Fund (G)
Escorts High Yield Equity Plan (G)
CORPUS
(Rs cr)
NAV EXPENSE 1 YEAR*

CAGR (%)
(Rs) RATIO (%)
(%) 3 YEARS 5 YEARS
732.08
32.13
2.61
18.91
36.55
21.04
3.25
25.23
2.50
17.46
22.43
10.70
DSP BR Micro-Cap Fund (G)
2271.60
41.48
2.43
17.40
33.50
19.99
Birla Sun Life MNC Fund - B (G)
2806.43
573.49
2.52
17.29
30.49
22.00
2.54
22.51
2.50
15.83
23.10
13.93
Escorts Leading Sectors Fund (G)
Top 5 diversified funds-based on one-year return. Corpus as on 30 November 2015, except Escorts High Yield Equity Plan and
Escorts Leading Sectors Fund as on 31 October 2015. Base date as on 14 December 2015.
* Absolute. NAV as on 14 December 2015.
Source: NAV India
have stayed invested for long period. Despite patiently waiting for 10 years, you
are not able to enjoy good returns. There
have been quite a few changes in the various charges by Ulips over the years. New
products have come with lower charges
compared with older ones. But, even after
the reduced charges, investing in mutual
funds and buying a term cover is a better
option than purchasing a two-in-one product like Ulip.
Do not mixing insurance with investment in mutual funds. The investor can continue with his cover even after redeeming
his mutual fund units or vice versa.
Thus, do not to go for a new Ulip but
chose a term plan and invest the remaining
amount in a good diversified mutual fund.
I wish to invest in the Senior Citizens
Scheme as this scheme yields more returns than fixed deposits (FDs) with nationalized banks. Currently, I am entitled for 9.3% as against approximately
7.5%-8% offered by most nationalized
banks to senior citizens. This scheme
is for five years. I want to know if the
rate on this scheme is floating or fixed?
If rates on all small saving schemes
come down in future, will the rates on
my scheme decline as it does on Public
Provident Fund (PPF) or will it be fixed
like on an FD? Also, is premature withdrawal allowed? If yes, is there any penalty clause?
Diwakar-85@
The returns on all small saving schemes are

fixed. Only PPF has a floating interest rate.
Thus, once you invest in a Senior Citizens
Saving Scheme, you will be entitled to the
prevailing rate at the time of your investment for the entire tenure of the deposit
even if the rates on new Senior Citizen Saving Schemes come down. Thus, once invested, you will be assured of 9.3% returns
till maturity.
You can opt for premature withdrawal
after one year. As penalty, the interest rate
will be lowered by 1.5%. If the amount is
withdrawn after two years, you will be entitled to 1% lower interest.
Rahul Mantri
...................................................................
The queries have been answered keeping in mind
that the investors understand the risks involved in
various investment options discussed in the column. Capital Market or the writer cannot be held
responsible for any loss arising due to the investment descision taken by investors based on the
solutions given. Readers may e-mail their queries
to: money-matters@capitalmarket.com
87
ApnaMoney
Tax Matters
approximately 8% pa and, post 60 years,
it will be about 7% pa as the amount of
pension. So if you have better investment
opportunities elsewhere, the option for
joining APY will solely depend on your
investment psychology.
Our private limited company has only
two directors-cum-shareholders since
the last three-four years. How do we appoint auditors and intimate to the Registrar of Companies (RoC)?
Mohan Iyer, e-mail
Tax Matters
What are the benefits of

Atal Pension Yojana?
By T K Doctor & Zankhana P Mehta
I am 36 years of age and my father and

mother are 60. We would like to take the
benefit of the Atal Pension Yojana (APY)
to get a minimum pension of Rs 5000
per month (pm). Kindly explain the
scheme.
Zankhana, e-mail
The Union government introduced APY

from 01 June 2015 as a part of the universal
social security schemes, especially for poor
and underprivileged people in India. The
scheme is aimed at all citizens in the unorganized sector who join the National Pension
Systems (NPS). It provides for a fixed minimum pension of Rs 1000 per month (pm),
Rs 2000 pm, Rs 3000 pm, Rs 4000 pm and
Rs 5000 pm at the age of 60 years, depending on the amount of contribution made by
the subscriber periodically. The amount of
contribution for the desired pension income
will be based on the age of the subscriber
while joining APY. The minimum age for
joining the scheme is 18 years and the maximum age is 40 years. Accordingly, the minimum period of contribution by the subscriber under APY will be 20 years or more.
As you are below 40 years of age, you
can opt to join the APY scheme. But your
parents, being senior citizens, are not eligible to opt for APY. APY is open to all
bank account holders. For subscribing to
APY, you need to have a bank account
from which contribution can be collected
periodically with auto debit facility. Also,
the subscribers who join NPS between
88
1 June 2015 and 31 December 2015, who

are not members of any statutory social
security scheme and who are not income
tax payers, will receive co- contribution
of 50% of the total contribution by the
subscriber or Rs 1000 per annum (pa),
whichever is lower, from the Central government for the first five years.
The scheme will be administered by
the Pension fund Regulatory and Development Authority and the amount collected under APY will be managed by pension funds appointed by PFRDA as per
the investments pattern specified by the
government. The subscriber of the scheme
has no say in the selection of the investment pattern or the pension fund. The
subscriber is not permitted to exit the
scheme before 60 years of age. However,
this rule will be relaxed in exceptional circumstances such as the death of beneficiary or terminal disease.
For a pension of Rs 5000, your contribution will be Rs 990 pm for 24 years.
You will accumulate a corpus of Rs
850000. The internal rate of return of the
scheme during the contribution phase is
Under Companies Act, 1956, it was the

duty of the auditor to file Form 23B with
the ROC about his appointment as the
statutory auditor. Under Companies Act,
2013, it is the duty of the company to file
Form ADT1 with the RoC about the appointment of statutory auditor.
As per Section 139(1) of the new Act, a
company has to appoint at its first annual
general meeting (AGM) an individual or firm
as an auditor, who shall hold office from the
conclusion of that meeting till the conclusion of its sixth AGM and thereafter till the
conclusion of every sixth meeting.
The tenure of five consecutive years is
subject to ratification by the shareholders at
every AGM.
The company will inform the auditor
within 15 days of the meeting in which he is
appointed. The auditor has to give a written
consent to become the statutory auditor of
the company and certificate stating that the
appointment is in accordance with conditions prescribed.
After completion of five years, the retiring auditor can be reappointed at the
AGM. Rotation of auditors applies to private limited companies with paid-up capital of Rs 20 crores or more or public borrowings of Rs 50 crores or more.
As per Section 224(1) of the Companies
Act, 1956, a company is required to give intimation of appointment to every auditor(s) so
appointed within seven days of the appointment. The intimation should be in the form of
a letter on the letter head of the company by a
responsible officer of the company.
The internal rate of return of the APY scheme

during the contribution phase is approximately
8% pa and, post 60 years, it will be about 7% pa
Dec 21, 2015 Jan 03, 2016
CAPITAL MARKET
ApnaMoney
Tax Matters
Every auditor appointed under Section

224(1) of the old Act in the AGM has to
inform the RoC in writing that he has accepted or refused to accept the appointment
[Section 224(1B)]. The information has to
be given in e-Form 23B within 30 days from
the date of appointment in the AGM.
Companies Act, 2013, casts the onus
on the company to inform the auditor of
his appointment and also file a notice of
such appointment with the ROC
within 15 days of the meeting in which the
auditor is appointed.
Hence, now as per Section 139(1) read
with Rule 4(2) of the Companies (Audit
and Auditors) Rules, 2014, the appointment of auditor at the AGM is to be intimated by the company to the RoC within
15 days of the appointment through filing
of Form ADT1.
I am accountant with a private limited
company since many years. But on account of continuous changes in various
laws I am lost. Can you throw light on
the important aspects of depreciation, as
per the Companies Act, 2013?
Rakesh,e-mail
One of the most important provisions of

the Companies Act, 2013, is the new method
of the calculating depreciation, as per Schedule II Part C of the Act.
Schedule II of the Companies Act for calculating depreciation is applicable only on
tangible assets. For intangible assets, companies have to follow the applicable accounting
standards. Depreciation depends on the useful life of various assets as defined in Schedule II of the new Act. The rates of depreciation depend on the useful life of assets. If a
company does not follow useful life method,
then it has to submit a technical report substantiating the useful life taken by it. Also, a
disclosure that a different useful life method
to that prescribed in the Act is used by the
company is mandatory.
Only 95% of the original cost of the asset only has to be depreciated. The remaining 5% is the residual value of the asset, as
per schedule II of the new Act. The residual
value of the asset is to be calculated on the
original cost of the asset.
If the life of the asset on 01 April 2014 is
more than the useful life, as prescribed in
Schedule II, then no depreciation can be charged
after this date. However, an amount equal to
the written-down value (WDV) (residual value)
has to be written off from either the profit and
The rate of depreciation becomes 1.5 times

the normal rates in case of double shifts and 2
times in case of triple shifts
loss (P&L) account or from the retained earnings of the company in FY 2014-15.
Date of purchase is important to calculate the remaining useful life of the asset as
on 01 April 2014. Existing assets are to be
depreciated over the remaining useful lives
as on this date.
The rate of depreciation becomes 1.5
times the normal rates in case of double shifts
and 2 times in case of triple shifts.
As per the Institute of Chartered Accountants of Indias guidance note, if the value of
the asset is up to Rs 5000, then it can be fully
depreciated. In the transitional year, i.e., FY
2014-15, the company cannot change its
method of calculating depreciation from
WDV to the straight-line method or vice
versa. Any change by the company in the
method of calculating depreciation will
amount to change in the accounting policy, as
per Accounting Standard (AS)-5. The calculation of the impact of such change on the
statement of P&L has to be disclosed by the
company in its financial statements.
Charging depreciation is mandatory if the
company wants to declare dividend or for
payment of managerial remuneration. Charging depreciation is also mandatory as per the
applicable AS to give a true and fair view.
What is Form F used for Central sales
tax (CST)?
Manoj, e-mail
As per Section 6A(1) of the CST Act, 1956,

submission of Form F is mandatory to
prove stock transfer. Otherwise, the trans-
Form F mandatory for CST
action will be treated as sale for all purposes of the CST Act.
From 10 November 2005, it is mandatory to file Form F for all movement of goods
out of a state that have taken place otherwise than in pursuance of sales, as per Section 6A of the CST Act. The Supreme Court
of India has upheld the judgment delivered
by the Allahabad High Court (HC) on 17
August 2007 in the case of Ambica Steels v
the State of Uttar Pradesh. It was decided
that it would be necessary to furnish declarations in Form F for inter-state movement
of goods sent for processing or goods received after processing, though the movement is on principal-to-principal basis.
Therefore, Form F is mandatory for all inter-state transfers (not by way of sale) including job work and return of goods.
There are no restrictions in getting Form
F even if the dealer is not registered. In most
states, there is no provision for obtaining
Form F from the CST department without
obtaining registration under the CST Act.
Therefore, Form F can only be issued to
registered dealers.
Submitting Form F is not a conclusive
evidence per se to prove beyond doubt any
stock or branch transfer. The assessing officer can make enquiry to ensure that the
declaration furnished by dealer is true. But
once the sales tax authority investigates and
opines that the movement of goods is an
inter-state sale and not transfer of stock, it
will be deemed conclusive evidence.
The first proviso to Rule 5 of the CST
Rules, 1957, provides that one Form F, covering receipts in the month, can be issued. If
space in the form is not adequate, a separate
list can be attached as annexure to the form,
giving details, provided that the annexure is
firmly attached.
Branch transfer within state is a matter
of state value-added tax (Vat) law. No Form
F is required and there is no Vat implication.
...................................................................
The replies are only in the nature of guidelines. The tax counsellors and the publication are not responsible for any decision
taken by readers on the basis of the same.
Readers may e-mail their queries on direct taxation to:
tax-matters@capitalmarket.com
89
CapitalineCorner
Capita Telefolio
beats
S&P BSE Sensex
by 400%
Elantas Beck India
Electrifying growth
see page 85
While lower raw material prices are currently driving earnings,

improvement in demand and new products will boost growth in future
Elantas Beck India (EBIL) is the market
leader in all the segments of liquid insulation in India, with a strong 38.4% share in
the primary insulation segment and commands 41.1% share in the secondary insulation segment.
Altana AG controls 75% equity. Elantas
GmbH, the holding company of the electrical insulation division within the Altana
Group, is the promoter of EBIL. Elantas
GmbH is the global market leader in primary and secondary insulations. Besides
India, there are manufacturing sites in Germany, Italy, China, Brazil and the US.
The business can be bifurcated into electrical insulations and engineering and electronic resins. The electrical insulation systems business, the dominant business activity of the company, can be further classified
into two major product lines: primary insulations and secondary insulation
The primary insulations product line
manufactures enameled wires used in transportation, automotive, white goods, consumer goods, motors and transformers,
power generation and distribution, lighting
and aerospace and defense.
Secondary insulation or impregnation
involves replacing air trapped inside the
wire windings with insulation material. It
is used in manufacturing motors, transformers, industrial drives, power generation and
distribution equipment, automotives and
lightning items.
There is around 16% market share in
India for the electronic and engineering materials segment. This business segment is
relatively new and small compared with the
electrical insulation systems business and
can be broadly classified into two major
product lines: resins and coating compounds
and construction chemicals.
Resins and coating compounds include
a wide range of room temperature curing
epoxy and polyurethane systems for potting, casting and encapsulation of electrical
and electronic components such as capacitors, resistors, diodes, solenoids and ignition coils. Also on offer are a wide variety
of specialty products within the range of
90
construction chemicals, mainly comprising

industrial floorings and wall coatings.
Electronic and electrical compounds have
been identified as the potential growth area.
The growth prospects are very promising in
view of its specialty product offerings for
electronics, auto electricals, high voltage cast-
http://www.telefolio.com
FOR MORE DETAILS ON PAGE 85
Strong presence
Elantas Beck India is a market leader in
all the segments of liquid insulation in
India and electronic and electrical
compounds are growth areas
Share price on BSE in Rs
Elantas Beck India: Financials

1312(12) 1412(12)1512(12P) 1612(12P)
Sales
304.32
341.45
362.59
12.9
12.3
17.7
17.8
OP
39.26
42.15
64.16
71.00
Other inc.
10.90
8.48
6.18
7.11
PBIDT
50.16
50.63
70.34
78.10
OPM (%)
398.85
Interest
0.18
0.24
0.37
0.40
PBDT
49.98
50.39
69.97
77.70
Dep.
5.38
5.42
5.32
5.86
PBT
44.60
44.97
64.65
71.84
Tax
12.85
13.36
21.12
22.27
PAT
31.75
31.61
43.53
49.57
40.1
39.9
54.9
62.5
EPS (Rs)*
* on current equity of Rs 7.93 crore. Face Value: Rs 10.

Figures in Rs crore.
Source: Capitaline Databases
ings and amorphous core bonding in transformers. Specialty epoxy and polyurethane
products catering to the auto and allied industries have been well received by original
equipment manufacturing customers and are
slowly replacing conventional imported systems from Japan, Korea, Italy and Sweden.
In view of this, the focus is on substituting
products imported by customers.
Active help is coming from European and
US affiliates of Elantas for speedy development and offering of better products. This
has created opportunities in new areas such
as reverse osmosis filtration membranes, Led
potting and advanced battery adhesives.
All user industries are on good growth
trajectory with fiscal ended March 2013 (FY
2013)-FY 2017E CAGR about 14% for the
household equipment industry, 9%-10% for
power supply and 15%-17% for auto components. One of the direct customers, the
electric wire industry, is expected to grow at
a CAGR of 15% for the next five years
Plants have been realigned and modernized its plants. Most of the capex has already been incurred. There is no need for
any major capex. Almost the entire production is in-house. Operations are at 70%-72%
of the installed capacity.
Exports to parent stands at around 3%
of total turnover. Most of the exports are to
South Asia. The parent has solid plans for
the subsidiary. There are new products and
new fields of businesses to be tapped. It
will take 18-24 months for something concrete to happen. All these products will be
for exports and local markets.
Net sales were up 2% to Rs 212.46
crore in the nine months ended September
2015 over a year ago. Lower crude oil and
copper prices bolstered the operating profit
margins 600 basis points to 18.1%, resulting in operating profit going up 53% to Rs
46.96 crore. Profit after tax grew 41% to
Rs 32.01 crore.
We expect EBIL to register EPS of Rs
54.9 in calendar year (CY) 2015, which
can go up to Rs 62.5 in CY 2016. The
scrip was trading around Rs 1327 on 14

December 2015.

3

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StockWatch

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Dec 21, 2015 Jan 03, 2016 CAPITAL MARKET

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Investors are worried that once the

or 4.14%, to settle at 25,044.43 in the

year till 11 December 2015. From a 52-week

Dec 21, 2015 Jan 03, 2016 CAPITAL MARKET

Inflows and outflows

Net investment in equity market by foreign

FPIs (Rs cr)

MFs (Rs cr)

Net turnover in Rs crore. BSE data

FPIs: Foreign portfolio investors. MFs: Mutual funds

SCRIPS ADVANCE DECLINE UNCHANGED

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The Ramco Cement*

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As on 11 December 2015. Returns in percentage.