Equity research of infrastructure sector

Genesis of the report

I have undergone my summer training at SHAREKHAN Ltd. It is one of the reputed and leading
company in India.
During the training period i got the practical knowledge of Equity markets and derivatives market.
It was observed that there was a significant movement in the share prices of infrastructure
companies. There is a vast scope and growth opportunities in this sector due to the impact of
current budget and untapped potential ahead. Development of infrastructure is the key for the
economic growth of developing countries like India and so I have selected this sector . During the
training session I had studied the price rise and decline in this sectors every day. It was a great
excitement for me to sit in the dealing room and practically viewing the trades taking process of
the infrastructure companies and other companies on trade terminal (trade tiger).

This project constitutes the details of Equity Analysis of infrastructure related companies listed in
NSE and BSE .It also consists of the Fundamental analysis and technical analysis of some
companies.
 Equity research of infrastructure sector

Company profile

S. S. KANTILAL ISHWARLAL SECURITIES PVT. LTD. (sharekhan.com):

Name of the Company : Sharekhan ltd.

Year of Establishment : 1925
Headquarter : ShareKhan SSKI
206 Phoenix House
Phoenix Mills Compound
Lower Parel
Mumbai - Maharashtra, India- 400013
Nature of Business : Service Provider
Website : www.sharekhan.com
Slogan : Your Guide to The Financial Jungle.

Sharekhan, India’s leading stock broker is the retail arm of SSKI, and offers you depository
services and trade execution facilities for equities, derivatives and commodities backed with
investment advice tempered by decades of broking experience. A research and analysis team is
constantly working to track performance and trends. That’s why Sharekhan has the trading
products, which are having one of the highest success rates in the industry. Sharekhan is having
2240 share shops in 110 cities; the largest chain of retail share shops in India is of Sharekhan.
 Equity research of infrastructure sector

• SSKI named its online division as SHARE KHAN and it is into retail Broking

• It acts as a discount brokerage house to a full service investment solutions provider

• It has specialized research product for the small investors and day traders

• Largest chain of share shops, 103 Franchisees & 17 Branches across India.

• It has $25m/trades every day.

• Leading player today with 20% market share

• Over 8000 online clients

SHAREKHAN LIMITED’S MANAGEMENT TEAM

Dinesh Murikya : Owner of the company

Tarun Shah : CEO of the company

Shankar Vailaya : Director (Operations)

Jaideep Arora : Director (Products & Technology)

Pathik Gandotra : Head of Research

Rishi Kohli : Vice President of Equity Derivatives

Nikhil Vora : Vice President of Research

Equity research of infrastructure sector

Services offered
 Equity research of infrastructure sector

Investment rationale

Historically shares have performed well in the terms of return on investment where the other
instruments have barely managed to generate returns at a rate higher than the inflation rate
(7.10%), on an average shares have given returns of about 17% in a year and that does not even
take into account the dividend income from them. Apart from this there are some other benefits
of investing in shares such as

Dividend income: investments in shares are attractive as much for the appreciation in the share
prices as for the dividends their companies pay out.
Tax advantages: shares appear as the best investment option if you also consider the unbeatable
tax benefits that they offer. First, the dividend income is tax-free in the hands of investors.
Second, you are required to pay only a 10% shortterm
capital gains tax on the profits made from investments in shares, if you book your profits within
a year of making the purchase. Third, you don't need to pay any long-term capital gains tax on
the profits if you sell the shares after holding
them for a period of one year. The capital gains tax rate is much higher for other investment
instruments: a 30% short-term capital gains tax
(assuming that you fall in the 30% tax bracket) and a 10% long-term capital gains tax.
Easy liquidity: shares can also be made liquid anytime from anywhere (on sharekhan.com you
can sell a share at the click of a mouse from anywhere in the world) and the investments can be
realised in just two working days.

Considering the high returns, the tax advantages and the highly liquid nature, shares are the best
investment option to create wealth but at the same time more risk attached to it. Therefor
investment decisions should not be based on rumours, gut feel or emotions; but should be taken
after a careful study of facts. The tool to help investor to take such decision is called “Equity
Research”
 Equity research of infrastructure sector

Definition and scope of equity research

Equity research is a report written by a brokerage or securities firm for its clients as a way to
help investors make decisions about where to invest resources. FINRA, the Financial Industry
Regulatory Authority, defines an equity research report, in Rule 2711 (a)(8) as, "a written or
electronic communication that includes an analysis of equity securities of individual companies
or industries, and that provides information reasonably sufficient upon which to base an
investment decision." Readers of Equity Research, more so than anything else, are looking for
you to identify trends that make investment decisions easier to justify.

The role of research is to provide information to the market. An efficient market relies on
information: a lack of information creates inefficiencies that result in stocks being
misrepresented (over or under valued).Analysts use their expertise and spend a lot of time
analyzing a stock, its industry and peer group to provide earnings and valuation estimates.
Research is valuable because it fills information gaps so that each individual investor does not
need to analyze every stock. This division of labor makes the market more efficient.

Research is a function of the market and is influenced by these swings. In a bull market
investment, the media and investors pressure analysts to focus on the hot sectors. Some analysts
morph into promoters as they ride the market. Those analysts that remain rational practitioners
are ignored, and their research reports go unread. During the late 1990s the business media
catered to the audience's demands and gave the spotlight to the famous talking heads that are
now under investigation.
 Equity research of infrastructure sector

Components of research

Research comprises of two main types of analysis

• Fundamental analysis
• Technical analysis

Fundamental analysis is a method of forecasting the future price movements of a financial

instrument based on economic, political, environmental and other relevant factors and statistics
that will affect the basic supply and demand of whatever underlies the financial instrument.

Technical analysis is a method of predicting price movements and future market trends by
studying charts of past market action which take into account price of instruments, volume of
trading and, where applicable, open interest in the instruments.

Main differences between the two types of analysis:

Fundamental analysis Technical analysis

Focuses on what ought to Focuses on what actually

happen in a market happens in a market

Factors involved in price

Charts are based on market
analysis:
action involving:
1. Supply and demand
1.Price
2.Seasonal cycles
2.Volume
3.Weather
3. Open interest (futures only)
4. Government policy

Nature and scope of the report

 Equity research of infrastructure sector

This report is a kind of analysis from investor’s point of view. It gives the idea about how to
take the investment decision with respect to available data specially equity market. This report
covers the different categories of invertors and their approach towards the market an d mention
all the parameter considered while taking investment decisions.

This report also given the systematic way for investors which says study of the sector is the first
step and then the stock analysis. At the same time is trying to convey the importance of the right
combination of the fundamental and technical analysis

Objective of the report

Primary Objective

• To do the equity research analysis of infrastructure sector

• To know the parameter of equity research analysis with respect to infrastructure sector

Sub objectives

• To study the infrastructure sector with respect to some major stocks

• To understand the movement and performance of stock
• To justify the current investment in these stocks
• To recommend investment decisions in these stocks

Research methodology and design

 Equity research of infrastructure sector

TYPE OF STUDY

The research has been based on secondary data analysis. The study has been exploratory as it
aims at examining the secondary data for analyzing the previous researches that have been done
in the area of technical and fundamental analysis of stocks. The knowledge thus gained from this
preliminary study forms the basis for the further detailed Descriptive research. In the exploratory
study, the various technical indicators that are important for analyzing stock were actually
identified and important ones short listed.

SAMPLE DESIGN

The sample of the stocks for the purpose of collecting secondary data has been selected on the
basis of Random Sampling. The stocks are chosen from the Infrastructure Sector

SAMPLE SIZE

The sample size for the number of stocks is taken as 2 for analysis of stocks as fundamental
analysis is very exhaustive and requires detailed study.

Limitations of the report

1. Analysis of two stocks only and ignores other major stocks in the sector
2. Only selected parameters are considered for analysis
3. More focus on fundamentals not on technical
4. Focus only on investment in equity
5. Duration of the project
6. No comparison with other sector.

Overview of Indian Infrastructure

The best barometer of country’s economic standing is measured by its GDP. India, the second
most populated country of more than 1100 million has emerged as one of the fastest growing
economies. It is a republic with a federal structure and well-developed independent judiciary
with political consensus in reforms and stable democratic environment .In 2008-09 India’s
 Equity research of infrastructure sector

economy-GDP grew by 6.5% due to global recession. In the previous four years, economy grew
at 9%.The Indian economy is expected sustain a growth rate of 8% for the next three years upto
2012. With the expected average annual compounded growth rate of 8.5%, India's GDP is
expected to be USD 1.4 trillion by 2017 and USD 2.8 trillion by 2027. Service sector contribute
to 50% of India‘s GDP and the Industry and agriculture sector 25% each.

In the past, development of infrastructure was completely in the hands of the public sector and
was plagued by corruption, bureaucratic inefficiencies, urban-bias and an inability to scale
investment. India's low spending on power, construction, transportation, telecommunications and
real estate, at $31 billion or 6% of GDP in 2002 had prevented India from sustaining higher
growth rates. This has prompted the government to partially open up infrastructure to the private
sector allowing foreign investment which has helped in a sustained growth rate of close to 9%
for the past six quarters.

About 600 million Indians have no mains electricity at all. While 80% of Indian villages have at
least an electricity line, just 44% of rural households have access to electricity According to a
sample of 97,882 households in 2002, electricity was the main source of lighting for 53% of rural
households compared to 36% in 1993. Some half of the electricity is stolen, compared with 3%
in China. The stolen electricity amounts to 1.5% of GDP. Almost all of the electricity in India is
produced by the public sector. Power outages are common. Many buy their own power
generators to ensure electricity supply. As of 2005 the electricity production was at 661.6 billion
kWh with oil production standing at785,000 bbl/day. In 2007, electricity demand exceeded
supply by 15%. Multi Commodity Exchange has tried to get a permit to offer electricity future
markets.

Indian Road Network is developing. Trucking goods from Gurgaon to the port in Mumbai can
take up to 10 days. India has the world's third largest road network Container traffic is growing
at 15% a year. Some 60% of India’s container traffic is handled by the Jawaharlal Nehru Port
Trust in Navi Mumbai. Internet use is rare; there were only 7.57 million broadband lines in India
in November 2009, however it is still growing at slower rate and is expected to boom after the
launch of 3G and wimax services
 Equity research of infrastructure sector

Most urban cities have good water supply water 24 hours a day, while some smaller cities face
water shortages in summer season. A World Bank report says it is an institutional problem in
water agencies, or "how the agency is embedded in the relationships between politics and the
citizens who are the consumers."

Various sectors in infrastructure

The transportation sector comprises aviation, ports, roads, rail system and logistics.

The agriculture sector comprises infrastructure-related storage facilities, construction relating

to agro-processing projects and reservation and storage of perishable goods.
 Equity research of infrastructure sector

Real-estate development, including industrial parks, special economic zones, tourism and
entertainment centers, educational institutions and hospitals and solid waste management
systems, also play significant role in Indian economy.

Figure 4.2.1 infrastructure spending

structure

Current growth and investment in the sector

The Infrastructure sector in India is traversing through one of its most interesting phases today. If
we look at our growth pattern over the past few years, we will realize how important it is for a
country to have a strong infrastructure to enable growth and development. Experts believe that
for India to emerge stronger from the global economic downturn, infrastructure will have a major
 Equity research of infrastructure sector

role in beefing up its GDP growth. According to Ernst & Young the construction sector has
grown at an annual rate of 12-15% from financial year 2004-2008 and is expected to rise at
around 35% during 2009-2013. The Indian economy is expected to sustain a growth rate of 8%
for the next three years up to 2012. With the expected average annual compounded growth rate
of 8.5%, India's GDP is expected to be USD 1.4 trillion by 2017 and USD 2.8 trillion by 2027.

Further, government continues to focus on infrastructure development as witnessed in the recent

budget. Moreover, this sector is attracting more funds not only from the domestic space but also
from the international arena, even in the form of PPP. Other factors including political intent,
liquidity position, commodity and crude prices, structural and procedural reforms at various
government body levels (like NHAI) are also well-placed to rollout the Indian infrastructure
growth story ahead. Moreover, companies in the infrastructure space are backed with strong
orders which show strong revenue visibility in coming future. Therefore, looking at the current
scenario and future growth potential we expect INDIAN INFRASTRUCTURE SECTOR to
outperform the markets in long term thereby providing excellent investment opportunities in the
sector.
 Equity research of infrastructure sector

FIGURE 4.3.1 Investments trend sector wise and

As shown in above table revised investment for all sectors except telecom and oil & gas has
reduced. News like auction of 3G spectrum and expected oil price hike forced to raise the
targeted investment in those two sectors which results into increase in the private investment
compare to original XI plan

Figure 4.3.2, will explain the trend of private sector investment in different sectors. Private sector
investment is increasing in all sectors except road, railways and airport industry
Equity research of infrastructure sector

FIGURE 4.3.2 ownership wise break up of

investment
 Equity research of infrastructure sector

Brief overview of Budget 2010-2011

With growing economy and a two digit growth expected over the next few years, infrastructure
sector would require a lot of growth and the right amount of incentives. The budget 20210-11
has addressed the infrastructure problems with number of allocations per the various aspects of
the sector. The finance minister has announced Rs. 10,000 crores allocation towards Indira
Award Yojna and Rs. 48000 crores towards Bharat Nirman. 25% of the planned allocation is
towards rural infrastructure. There also has been interest subvention for housing loans up to Rs 1
lac.
Allocation for infrastructure projects for the ensuing fiscal will be Rs.173,552 crore ($38.5
billion), or 46 percent of the total plan outlay, since good roads, ports and railways were essential
to sustain growth. Also included is the allocation towards the NREGA scheme has been
enhanced to Rs 41,000 crores. Further, additional deduction available for investment in long-
term infrastructure bonds for individuals will aid in the faster execution of infrastructure projects.
A fund of Rs 5130 cores has been set aside for the power sector. Allocation for Road Transport
was raised by over 13% to Rs19,894 cr, whereas allocation for improving Railway infrastructure
was increased by 6.0%. Tax deductions on investments on long-term Infrastructure bonds of
Rs20,000 pa. (under the new Section 80CCF), besides the existing limit of Rs1lakh under
Section 80C, thereby improving liquidity for the Infra Sector was also announced.
Disbursements by India Infrastructure Finance Company Ltd (IIFCL) are expected to reach about
Rs.20,000 crore by March 2011 and it is expected to refinance over Rs.6,000 crore in 2010-11.
 Equity research of infrastructure sector

Parameters to be considered for the investment

By a trader

Trader, being a short term player in the stock market has an aim of making profits through
fluctuations in the share price of that company. Thus he is a speculator rather than an investor.
He is primarily concerned with the technical analysis of the security. He is basically interested in
predicting the future price trends from historical price trends and volume data.

The main fundamentals that he should take into consideration are

• Movement of the market considers everything

• Movement of prices is purposeful

• History repeats itself

He considers the following methods while predicting the stock movements

• Support and resistant level

 Equity research of infrastructure sector

• Trend lines

• Moving averages

• Market fluctuations

By investor

Investor, unlike the trader, has main focus on the fundamentals of the company rather than the
price volatility. His investments are based on the records and reports of the company which is a
method of study that attempts to predict price action and market trends by analyzing economic
indicators, government policy and societal factors (to name just a few elements) within a
business cycle framework . He considers the county level analysis and then focuses on industry
and then company level analysis.

Besides he uses his tools like

• Ratio analysis

• Du pont analysis

The main aim of an investor is

• To conduct a company stock valuation and predict its probable price evolution,

• To make a projection on its business performance,

• To evaluate its management and make internal business decisions,

 Equity research of infrastructure sector

• To calculate its credit risk.

He takes into consideration the points like

1. How a company is perceived by its competitors?

2. Whether the company is the market leader in its products or in its segment

3. Company Policies

Investment companies take into consideration both the fundamental and technical analysis while
selecting a sector .They include asset management companies, insurance companies, private
equity companies, real estate. They invest a part of their fund in a diversified portfolio to
maximise their returns and minimise the risk involved in it. Their main aim is to maximise the
wealth of the share of the clients

FII’S

FII i.e. Foreign Institution Investors mainly focus on maximising the returns arising from the
currency fluctuations and arbitrage from the prices of the securities in different markets. They
are can be short term or also long term.

It includes factors like

• country risk

• political risk

• economic stability

• industry specific risk

• market sentiments of investors

• industry performance

Major stocks

Company Market Cap P/E P/BV EV/EBIDT ROE ROCE D/E

 Equity research of infrastructure sector

(TTM
(TTM) A
(Rs. in Cr.) ) (%) (%) (x)
(x) (x)
(x)

DLF 54,257.39 70.56 4.24 13.62 13.1 12.6 0.76

JP Associates 27,726.03 28.00 3.38 9.41 16.9 11.4 2.00

Unitech 20,734.49 39.40 2.50 7.85 29.6 16.1 3.16

Jaypee Infratec. 12,042.02 13.50 3.30 0.00 24.1 14.2 0.94

HDIL 9,673.57 16.22 1.34 4.53 20.5 18.1 0.90

IRB Infra.Devl. 9,209.70 164.94 6.72 42.37 4.2 4.2 0.06

D B Realty 9,198.88 40.44 2.97 0.00 32.8 20.5 0.72

Indbull.RealEst. 6,745.71 299.91 1.04 37.15 -0.1 -9.8 0.20

IVRCL Infra. 5,054.31 23.93 2.73 5.62 13.3 16.1 0.72

Godrej Propert. 4,905.22 498.05 6.02 17.37 2.6 18.3 0.81

Nag. Constructn. 4,670.49 23.37 2.08 5.69 9.5 14.5 0.66

Punj Lloyd 4,572.33 51.19 1.28 6.18 12.8 16.0 0.86

Sunteck Realty 3,881.50 0.00 11.05 213.86 5.3 4.6 0.22

Hind.Construct. 3,830.93 46.62 2.52 13.43 6.8 8.1 1.92

Era Infra Engg. 3,743.26 15.25 2.50 5.51 29.6 18.6 2.37

TABLE 6.1 Major stocks in infrastructure with key financial figures

 Equity research of infrastructure sector

DLF

The DLF Group was founded in 1946. We developed some of the first residential colonies in
Delhi such as Krishna Nagar in East Delhi, which was completed in 1949. Since then we have
been responsible for the development of many of Delhi’s other well-known urban colonies,
including South Extension, Greater Kailash, Kailash Colony and Hauz Khas.

Following the passage of the Delhi Development Act in 1957, the state assumed control of real
estate development activities in Delhi, which resulted in restrictions on private real estate colony
 Equity research of infrastructure sector

development. We therefore commenced acquiring land at relatively low cost outside the area
controlled by the Delhi Development Authority, particularly in the district of Gurgaon in the
adjacent state of Haryana.

This led to our first landmark real estate development project – DLF Qutab Enclave, which has
now evolved into DLF City. DLF City is spread over 3,000 acres in Gurgaon and is an integrated
township, which includes residential, commercial and retail properties in a modern city
infrastructure with schools, hospitals, hotels and shopping malls. It also boasts of the prestigious
DLF Golf and Country Club with night golfing facilities.

DLF Limited, is India's largest real estate company in terms of revenues, earnings, market
capitalization and developable area. It has a 62-year track record of sustained growth, customer
satisfaction, and innovation. The company has approximately 238 msf of completed
development and 423 msf of planned projects, and has pan India presence across 30 cities.

DLF's primary business is development of residential, commercial and retail properties. The
company has a unique business model with earnings arising from development and rentals. Its
exposure across businesses, segments and geographies, mitigates any down-cycles in the market.
DLF has also forayed into infrastructure, SEZ and hotel businesses.

Date of Listing (NSE) : 05-Jul-2007

Face Value : 2.00
Industry : CONSTRUCTION
Constituent Indices : CNX 100,CNX 500,NIFTY

Issued Cap. : 1697406550(shares) as on 16-Jul-2010

Market Cap. : Rs. 54418.85(Cr) as on 16-Jul-2010
 Equity research of infrastructure sector

52 week high/low price : 519.90/254.50

Shareholding pattern as on 31/03/2010

No. of shares Holding

(%)

Indian promoters 1334803120 78.64

Banks and financial 6260667 0.37

institution

FII’s 250702383 14.77

Private corporate bodies 27240332 1.60

NRI’s OCB’s foreign 2548727 0.15

others

Others 4153113 0.24

General public 6700312 3.95

Total 1697263990

TABLE 7.1.1 Shareholding pattern of DLF

Key financial indicators

Quarterly results in brief (Rs in cr)

Mar ' 10 Dec ' 09 Sep ' 09 Jun ' 09

Sales 781.97 887.16 314.19 417.97

 Equity research of infrastructure sector

Mar ' 10 Dec ' 09 Sep ' 09 Jun ' 09

Operating profit 371.55 402.59 129.92 207.97

Interest 261.86 210.87 167.78 206.73

Gross profit 519.25 322.02 79.33 149.10

EPS (Rs) 2.42 1.32 0.20 0.59

TABLE 7.2.1 Quarter wise results of DLF

FIGURE 7.2.1 quarter wise growth in sales and operating

profit

ATTRIBUTE Value Date

P/E Ratio 69.62 13/07/10
EPS (Rs) 4.53 Mar 10
Sales (Rs. In cr) 781.97 Mar 10
Face value (Rs) 2
Net profit margin (%) 40.36 Mar09
Last dividend (%) 100 31/07/10
Return on average equity (%) 12.5 Mar 09

TABLE 7.2.2 Performance

 Equity research of infrastructure sector

FIGURE 7.2.1 dividend given (in%)

DLF ltd having strong fundamentals with huge stake of Indian promoter’s (79%) which rate the
stock highly secure in the long term. There is substantial increase in the sales of company during
last three quarters and EPS is also improved which indicates the growth prospect for future.
Though they have not given dividend on regular basis maintain the 100% dividend policy which
might affect the prices of the stock.

Technical analysis
 Equity research of infrastructure sector

FIGURE 7.3.1 index comparison

FIGURE 7.3.2 price movement

Comparison with sensex index shows that DLF was not following the same trend as sensex.
Price movement during last year shows the fluctuation pattern which helps the decision of
investor to make money from the trading in very short term.

Though the decisions based on these trends may not be always right but it gives a rough idea
about the future trend of prices.
 Equity research of infrastructure sector

Announcements

April 24, 2010

DLF has informed BSE that Caraf Builders & Constructions Pvt. Ltd. (Caraf), a subsidiary of
DLF Ltd., has purchased 245,232,000 Compulsorily Convertible Preference Shares (CCPS)
issued by DLF Assets Ltd. (DAL) and held by DSIPL (a Company owned by SC Asia Pte Ltd.),
for a consideration of INR 3084.68 crore, inclusive of withholding taxes as applicable. This has
resulted in Caraf's economic interest in DAL increasing to 91.90%. The transaction was
consummated on April 23, 2010.
This is in line with DLF's overall strategy to consolidate the shareholding of DAL. DSIPL shall
continue to hold 27,247,230 CCPS, which gives it an economic interest of 4.59% in DAL.
Caraf is engaged in the business of acquisition and development of real estate properties in India
and presently holds 4 rent yielding properties based out of Gurgaon, Kolkatta and Chandigarh.
DAL is a notified co-developer for 4 IT/ITES Special Economic Zones (SEZs) based out of
Gurgaon, Chennai and Hyderabad

May 14, 2010

DLF Ltd has announced the following results for the quarter & year ended March 31, 2010:
The Consolidated Results are as follows:
The Unaudited consolidated results for the Quarter ended March 31, 2010
The Group has posted a net profit of Rs 4263.80 million for the quarter ended March 31, 2010 as
compared to Rs 1590.50 million for the quarter ended March 31, 2009. Total Income has
increased from Rs 13514.20 million for the quarter ended March 31, 2009 to Rs 21461.40
million for the quarter ended March 31, 2010.
The Unaudited consolidated results for the Year ended March 31, 2010
The Group has posted a net profit of Rs 17300.10 million for the year ended March 31, 2010 as
compared to Rs 44696.00 million for the year ended March 31, 2009. Total Income has
decreased from Rs 104313.60 million for the year ended March 31, 2009 to Rs 78542.70 million
for the year ended March 31, 2010.

May 24, 2010

 Equity research of infrastructure sector

DLF Ltd has informed BSE that the Committee of Directors has allotted Equity Shares as
detailed below upon exercise of Options by the employees under the Company's Employees
-Date of Allotment : May 21, 2010
- No. of Equity Shares (face value of Rs. 2/- each) : 12,330.
Equity research of infrastructure sector

IVRCL infra
 Equity research of infrastructure sector

Strongly entrenched with proven domain knowledge, experience and

credentials, IVRCL operates in the following infrastructure sectors:

• Water & Environment

• Transportation

• Buildings

• Power

Milestones in the making of a giant

• Commercial operations since 1990

• Established itself as a premier EPC & LSTK Service Provider with front-end engineering
capabilities in 1990

• Achieved Group turnover of 1 Billion USD in less than two decades of our operations

• Foray into BOT/BOOT/DBOOT projects since 2001

• Achieved a Turnover of around Rs. 37000 million / USD 900 million and a net worth of
Rs. 16000 million / USD 400 million in less than two decades of our operations.

Group companies
 Equity research of infrastructure sector

IVRCL INFRASTRUCTURES & PROJECTS

LIMITED

IVRCL ASSETS &

HINDUSTAN DORR-OLIVER Ltd
HOLDINGS Ltd

DAVY MARKHAM (UK)

IVRCL Assets & Holdings Ltd.

IVR Prime is dedicated to creating luxury-intensive urban infrastructure. Up to-the-minute

technologies, environmental soundness and superior aesthetics combine to make IVR Prime’s
developments the most talked-about. The projects include.

Residential

• Hill Ridge Springs

• Hill Ridge Villas

 Equity research of infrastructure sector

Hospitality

• Ellaa Suites

• Mall at Hill Ridge Springs

Hindustan Dorr-Oliver Ltd.

Hindustan Dorr-Oliver (HDO) is a leading Indian Engineering, Procurement and Construction

(EPC) Company. With a unique combination of process know-how, experience and
technical/managerial ability in pollution control processes, Hindustan Dorr-Oliver is an ideal
acquisition for IVRCL.
HDO’s core expertise lies in Designing, Manufacturing, Supplying & Installing Equipment,
Systems & Processes for liquid-solid separation and pollution control in the following industries:

• Pulp and Paper

• Mineral Beneficiation

• Chemicals, Food and Pharmaceuticals

• Breweries and Distilleries

• Refineries and Petrochemicals

• Oil and Gas

• Phosphatic Fertilizers

• Industrial and Municipal Waste Water / Waste Water

 Equity research of infrastructure sector

Date of Listing (NSE) : 08-mar-2000

Face Value : 2.00
Industry : Construction & Contracting – Civil
Constituent Indices : CNX 100,CNX 500,NIFTY

Market Cap. : Rs. 5054.5 (Cr) as on 16-Jul-2010

52 week high/low price : 212.5/144.1

Share holding pattern as on: 31/03/2010

No. of shares Holding

(%)

Indian promoters 12991092 9.70

Banks and financial 594384 0.72

institution

FII’s 77499032 57.44

Private corporate bodies 13250853 10.06

NRI’s OCB’s foreign 592668 0.53

others

Others 566735 0.32

General public 10859089 11.41

Total 133504929

TABLE 8.1.1 Shareholding pattern of IVRCL Infra

 Equity research of infrastructure sector

Key financial indicators

Quarterly results in brief ( Rs. In crores)

Mar ' 10 Dec ' 09 Sep ' 09 Jun ' 09

Sales 1,890.41 1,184.05 1,217.83 1,086.03
Operating profit 198.43 115.58 114.47 99.59
Interest 52.54 36.84 35.37 38.93
Gross profit 147.88 82.64 84.82 64.57
EPS (Rs) 3.19 3.43 3.65 2.63
TABLE 8.2.1 Quarter wise results of IVRCL Infra

ATTRIBUTE Value Date

P/E Ratio 23.83 14/07/10
EPS (Rs) 7.91 Mar 10
Sales (Rs. In cr) 1890.41 Mar 10
Face value (Rs) 2
Net profit margin (%) 4.45 Mar09
Last dividend (%) 40 31/05/10
Return on average equity (%) 12.5 Mar 09

TABLE 8.2.2 Performance indicators of IVRCL Infra

 Equity research of infrastructure sector

Dividend

FIGURE 8.2.1 dividend given

Since FII’s holding the major of the stake (57.44%) with only 9% stake by promoters increase
the risk factor from investment point of view. Though it shows the sign of faster growth in
future suspect the sustainability of the company during global financial crises or recession.

There is a continuous growth in the sales figures. Company giving dividend on the regular basis
though the rate is fluctuating.

With the huge orders in hand it is very good stock to invest not only for long term but for the
shorter version of 4-5 months also.

Technical analysis
 Equity research of infrastructure sector

FIGURE 8.3.1 index comparison

FIGURE 8.3.2 price movement

Index comparison shows the IVRCL follows the same trend as the sensex but the percentage
change is proportionally high. It is advisable to invest in the stock when sensex shows even a
slight upward trend. Price movement is upward in the long run comparing to short run.
 Equity research of infrastructure sector

Announcement

May 29, 2010

IVRCL Infrastructures & Projects Ltd has informed BSE regarding a Press Release dated May
29, 2010 titled IVRCL achieved turnover of Rs. 5494 crores for the year 2009-10

May 29, 2010

IVRCL Infrastructures & Projects Ltd has announced the following results for the quarter & year
ended March 31, 2010:

The Unaudited results for the Quarter ended March 31, 2010
The Company has posted a net profit of Rs 852.474 million for the quarter ended March 31,
2010 as compared to Rs 798.823 million for the quarter ended March 31, 2009. Total Income has
increased from Rs 16784.117 million for the quarter ended March 31, 2009 to Rs 18923.959
million for the quarter ended March 31,2010.

The Audited results for the Year ended March 31, 2010
The Company has posted a net profit of Rs 2113.134 million for the year ended March 31, 2010
as compared to Rs 2259.673 million for the year ended March 31, 2009. Total Income has
increased from Rs 50103.493 million for the year ended March 31, 2009 to Rs 55077.839 million
for the year ended March 31, 2010.

The Consolidated Results are as follows:

The Audited consolidated results for the Year ended March 31, 2010
The Group has posted a net profit of Rs 2155.533 million for the year ended March 31, 2010 as
compared to Rs 2249.840 million for the year ended March 31, 2009. Total Income has increased
 Equity research of infrastructure sector

from Rs 50860.384 million for the year ended March 31, 2009 to Rs 58566.389 million for the
year ended March 31, 2010.

June 01, 2010

IVRCL Infrastructures & Projects Ltd has informed BSE regarding a Press Release dated June
01, 2010 titled IVRCL Group bags India's one of the largest Toll Road Project from NHAI.

July 12, 2010

R Balarami Reddy has submitted the disclosure under Regulation 13(4) of the SEBI (Prohibition
of Insider Trading) Regulations, 1992 to BSE

July 13, 2010

IVRCL Infrastructures & Projects Ltd has submitted the disclosure under Regulation 13(6) of the
SEBI (Prohibition of Insider Trading) Regulations, 1992 to BSE:

Learning
 Equity research of infrastructure sector

During this project I got the opportunity to gain the in depth knowledge of the study and very

Important learning mentioned as below:

• There are different kinds of perceptions in the mind of investor while investing and it
changes from investor to investor
• This study helps me to analyze the stock as per the objective of investment
• Even a speculator needs to analyze the fundamental and technical aspects

References
 Equity research of infrastructure sector

Web sites

www.investopedia.com

www.moneycontrol.com

sharekhan.com

www.dlf.in

www.ivrcl.com

www.money.rediff .com

www.netequityresearch.com