India Infoline

Financial Services
Company Report
India Infoline
Outperformer
Rs 178
Sensex: 12,353
October 12, 2006
Rajesh Malhani
Getting better with diversification
(9122) 6632 2236
[email protected]
We initiate coverage on India Infoline (IIL) with an 'Out Performer'
rating and a price target of Rs 220. We believe that the company has
shown phenomenal growth in past quarters and expect it to continue
with same momentum in the future.
5,210
1,374
703
43.6
15.6
1,973
950
35.2
21.1
Key Ratios
(%)
’05
’06
’07E
’08E
EBITDA Mar. 38.0
38.5
35.7
37.9
RoCE
29.4
22.6
16.5
15.4
RoE
41.5
25.2
31.3
34.9
Valuations
Y/e March
PER
Price / BV
(x)
’05
’06
’07E
’08E
26.0
10.7
16.4
4.2
11.5
3.9
8.5
3.0
Key Data
Bloomberg Code
Reuters Code
:
:
ILFL@IN
ILFL.BO
Shareholding Pattern (%)
Promoters
Foreign
Inst./non-Promoters
Public & Others
:
:
:
:
35.8
24.8
17.3
22.1
Price Relative to Sensex (%)
1 month
6 months
12 months
:
:
:
Shares Outstanding :
Market Cap
:
Average Volume
(3 months)
:
We expect earnings growth of 80% and 35% in FY07E and FY08E
respectively. At current valuations, the stock is quoting at 11.5x
FY07E and 8.5x FY08E. Valuations are in line with the international
broking firms, but considering the low penetration of financial
services in the country, we foresee great potential for India Infoline.
Highlights
Focus on building non-equity segments
Foray into investment banking
Venturing into general insurance distribution
Phenomenal growth expected in commodity broking
Entry into international market
Stock price performance
2.9
(6.5)
(16.4)
45m
Rs 8,048m
$175m
0.7 m
(Price as on October 11, 2006)
(Rs.)
Y/e March
The company has significant exposure in retail equity broking and
with the expansion in its networth it is expecting empanelment from
Institutional clients as well. It plans to increase its non-equity income
contribution from current levels of 33% to 38% and 46% by FY07E
and FY08E respectively.
India Infoline
240.0
220.0
200.0
180.0
160.0
140.0
120.0
100.0
80.0
Rel. to Sensex (%) - RHS
10
0
(10)
(20)
(30)
(40)
(50)
(60)
Oct-06
3,847
822
489
125.6
10.8
Sep-06
2,134
288
217
6.9
Aug-06
757
EBITDA
PAT
PAT Gr. (%)
EPS (Rs)
Jul-06
Net Sales
From a stand-alone online research portal it has molded itself into
one of the leading financial services company operating in equity &
commodity broking, distribution of financial products and
investment banking.
Jun-06
’08E
May-06
’07E
Apr-06
’06
Mar-06
’05
Feb-06
Y/e March
Jan-06
(Rs m)
Dec-05
Key Figures
Nov-05
(9122) 6632 2234
[email protected]
Oct-05
Kiranjot Kahlon
India Infoline – Getting better with diversification
Table of Contents
Investment Highlights .................................................................. 3
Strong growth in Industry volumes and rising retail participation ........................... 3
Increasing internet penetration .................................................................................. 4
Well positioned to exploit the opportunity in Insurance segment .............................. 4
Strong growth in commodity broking ....................................................................... 5
Foray into Investment Banking .................................................................................. 6
Investment Concern ..................................................................... 7
High reliance on equity segment ................................................................................ 7
Investment for future keep near term returns low .................................................... 7
Competition from banks ............................................................................................ 8
Valuations .................................................................................... 9
Company profile ..........................................................................10
Geographical presence ............................................................................................. 11
Business Analysis .......................................................................12
Equity Broking ........................................................................................................ 12
Insurance Distribution Business .............................................................................. 13
Foray into general insurance distribution ........................................................ 13
Distribution of Mutual fund and other loan products ............................................. 13
Commodity Broking ................................................................................................ 14
Financial Analysis .......................................................................15
Financials ...................................................................................16
Income Statement ................................................................................................................... 16
Balance Sheet ......................................................................................................................... 17
Key Ratios .............................................................................................................................. 17
Tables & Charts
Graph 1: Indian Equity market and India Infoline Volumes .................................................... 3
Graph 2: Trend in branch expansion and customer Acquisition .............................................. 3
Table 1: Online trading Statistics ............................................................................................. 4
Graph 3: Life Insurance penetration ........................................................................................ 5
Graph 4: Trend of Volumes at MCX and NCDEX .................................................................... 5
Graph 5: Equity market contribution to earnings .................................................................... 7
Graph 6: Trend of EBIDTA margin .......................................................................................... 8
Table 2: Comparative Valuation ................................................................................................ 9
Graph 7: Milestones achieved ................................................................................................ 10
Graph 8: Business Area at India Infoline ............................................................................... 11
Graph 9: State wise contribution to the topline ...................................................................... 11
Graph 10: Trend of Customer per branch and Turnover per client ....................................... 12
Graph 11: Premium and commission on rise ........................................................................ 13
Graph 12: Funds mobilized and income generated ............................................................... 14
Table 3: Key assumptions ....................................................................................................... 15
2 of 18
October 12, 2006
India Infoline – Getting better with diversification
Investment Highlights
Strong growth in Industry volumes and rising retail
participation
Increasing retail
participation leads to
higher volumes for IIL
Average daily volumes in the equity markets (cash and derivative combined)
have increased by 72% from to Rs.167bn in FY 05 to Rs. 288bn in FY 06. With
the economy growing at 7-8% a mounting per capita income and growing BPO
culture, there is a new class of young investors, which are moving towards the
equity market.
Graph 1: Indian Equity market and India Infoline Volumes
49,000
BSE & NSE
Derivative
India Info (RHS)
42,000
1,100
900
28,000
700
21,000
500
(Rs Crs)
(Rs Crs)
35,000
14,000
300
7,000
May-06
Mar-06
Jan-06
Nov-05
Sep-05
Jul-05
May-05
Mar-05
Jan-05
Nov-04
Sep-04
Jul-04
May-04
Mar-04
100
Jan-04
0
Source: Company Data, PL Research
IIL is majorly present in the retail segment. With the rising income levels, risktaking ability of people and the confidence in the India Inc, participation from
the retail crowd is increasing y-o-y. IIL is aggressively increasing its presence by
opening branches in Tier I and II cities. In FY QI-07, they roll out 56 new branches
and acquired 25000 new customers. We expect them to have 350 and 430
branches by FY 07E and FY 08E respectively.
Graph 2: Trend in branch expansion and customer Acquisition
300,000
Customer
Branches (RHS)
525
450
250,000
375
200,000
300
150,000
225
100,000
150
50,000
75
0
0
FY04
FY05
FY06
FY07E
FY08E
Source: Company Data, PL Research
October 12, 2006
3 of 18
India Infoline – Getting better with diversification
Increasing internet penetration
IIL foucsing on building its
online clientbase
With increasing PC and Internet penetration in tier II and tier III cities, there is
huge potential for Internet trading. Internet trading, began in 2000 is still at a
nascent stage, however, there has been a steady growth in Internet trading
volumes. This can be attributed to growth in sophistication of retail investors,
increasing P.C penetration, higher telecom density, lowest brokerage and userfriendly software.
Table 1: Online trading Statistics
Year
Registered
Trading
% of trading Volumes
Clients
Volumes
through Internet
2000-01
123,578
7,288
0.54
2001-02
231,899
8,139
1.59
2002-03
346,420
15,361
2.48
2003-04
463,560
37,945
3.45
2004-05
849,696
81,034
7.11
2005-06
14,432,391
183,429
11.68
Source: NSE, PL Research
IIL's 87% of the clientele is online. It has user-friendly software and is focused
towards building online clientele. Increasing online penetration suggests huge
potential for IIL.
Well positioned to exploit the opportunity in Insurance
segment
IIL is leveraging its established branch network to distribute Life insurance
products of ICICI Pru to its retail clients. It has applied to IRDA for insurance
broker status, which will enable them to enter general insurance segment and
sell products across companies.
Acting as insurance broker
will significantly increase
revenues from this segment
4 of 18
Insurance penetration in India is just 3.25% (general insurance 0.75% of GDP)
of GDP, which reflects huge potential in the country. IIL compared to other
players in the industry (like: Indiabulls Financial service and IL&FS Investsmart)
is an established player in this segment and has trained employees for insurance
distribution. Indiabulls inspite of having vast branch network has an
insignificant presence in insurance distribution at present. Entry of other players
will definitely increase the competition but IIL would be in a better position
because of the relations it has built with clients and because of the professional
work force it has.
October 12, 2006
India Infoline – Getting better with diversification
Graph 3: Life Insurance penetration
12.0
(%)
9.0
6.0
3.0
China
India
Malaysia
US
Australia
Korea
Japan
UK
0.0
Source: Company Data, PL Research
Strong growth in commodity broking
Commodity market is at a very nascent stage in India. With significant volumes
witnessed in the market and rising awareness among people, commodity segment
is expected to sustain its phenomenal growth. IIL's average daily volume is
around Rs.1bn. It provides this facility through 100 branches and is
concentrating in selected areas for this segment. It has identified Rajasthan
and Gujarat as potential areas where there is significant presence of HNI's and
self employed people. Sensing the opportunity at Gujarat, it plans to open new
30 branches in Ahemdabad in addition to the existing 20 branches. Income
from commodity broking is expected to grow robustly from Rs.41.3 mn in FY06
to Rs.129mn and Rs.194 by FY 07E and FY 08E.
Graph 4: Trend of Volumes at MCX and NCDEX
1,200,000
1,000,000
(Rs m)
800,000
600,000
400,000
200,000
Q1FY05 Q2FY05 Q3FY05 Q4FY05 Q1FY06 Q2FY06 Q3FY06 Q4FY06
Source: MCX and NCDEX
October 12, 2006
5 of 18
India Infoline – Getting better with diversification
Foray into Investment Banking
Concentrating on SMEs
IIL has received an investment-banking license and plans to target small and
medium sized companies for this service. With consolidation happening across
the sectors, there's significant momentum expected in this segment.
Foreseeing the potential, IIL has acquired London based Marchmont Capital
Advisors. Marchmont has more than 20 years of experience in this field. IIL
plans to set up offices in three major cities in the country and five overseas
centers within six months. We don't expect the company to show any results in
the coming two quarters but it would make contribution to the earnings by
FY08.
6 of 18
October 12, 2006
India Infoline – Getting better with diversification
Investment Concern
High reliance on equity segment
Broking Income directly
related to capital market
performance
In FY06, 67% of IILs earnings are derived from the equity broking business.
Any volatility in the market has direct impact on the earnings of the company.
Sensing this possibility IIL's diversified into other business segments like
distribution of financial products, commodity broking and recent entry into
investment banking. These segments will take time to drive the earnings of the
company. We expect earnings from equity broking to be 62% and 54% of the
earnings by FY07E and FY08E respectively.
Graph 5: Equity market contribution to earnings
80.0%
60.0%
40.0%
20.0%
0.0%
FY05
FY06
FY07E
FY08E
Source: Company Data, PL Research
Investment for future keep near term returns low
IIL is in expansion mode
which will lower the returns
in near future
October 12, 2006
India Infoline is ramping up its distribution network. It currently has 233
branches and plans to set up 350 by end of FY07E. While this investment is
imperative from a longer-term view, near term it will impede earnings
progression. Though EBIDTA has grown in absolute terms, EBIDTA margin is
expected to move down to 36% in FY07E and again increase to 38% by FY08E.
7 of 18
India Infoline – Getting better with diversification
Graph 6: Trend of EBIDTA margin
(Rs m)
2,500
EBIDTA
EBIDTA Margins (RHS)
39.0%
2,000
38.0%
1,500
37.0%
1,000
36.0%
500
35.0%
-
34.0%
FY 05
FY 06
FY 07
FY 08
Source: Company Data, PL Research
Competition from banks
Distribution business is purely a "reach" game. With banks making foray into
the distribution of financial products it would be challenging for IIL to capture
the market. Banks are well networked across the country covering almost all
cities, towns and villages. They have a huge customer base to exploit. Above all
banks are looked upon as trust worthy compared to a standalone financial
product distributing company.
8 of 18
October 12, 2006
India Infoline – Getting better with diversification
Valuations
At CMP, the stock is trading at 11.5x FY07E and 8.5x FY08E earnings of Rs
15.6 and Rs 21.1 respectively. We expect a 19% CAGR in revenues triggered by
sound equity market volumes and rising contribution from insurance
distribution segment.
We have compared IIL to domestic as well as International brokers. The
international brokers are trading at an average multiple of 16.6x FY08E.
Considering the low penetration of financial services in the country, India depicts
higher growth potential and therefore larger scope of expansion for IIL.
Table 2: Comparative Valuation
Company
EPS
P/E
RoE
FY08E
FY07E
RoA
FY07E
FY08E
FY07E
India Infoline
15.8
21.0
11.5
8.7
31.3
FY08E FY07E FY08E
34.9
16.5
15.4
Invetsmart*
12.8
14.7
15.7
13.0
14.5
17.1
12.2
14.5
Indiabulls*
17.2
20.3
22.5
19.0
19.5
18.1
10.0
7.9
2.9
International Broking Houses
Etrade*
1.5
1.7
16.8
14.3
16.2
16.2
Ameritrade* (sept end) 0.9
1.2
21.7
16.0
33.1
35.7
2.6
Charles Schwab*
0.9
22.9
19.7
22.1
23.4
2.1
0.8
2.3
* Bloomberg Estimates
IIL is not directly comparable to Indiabulls, as the later valuations reflect its
real estate business as well, therefore IL&FS Investsmart would be the only
comparable peer in domestic market.
We believe valuations look attractive, given its growth prospects and rate the
stock as an 'Outperformer' with a price target of Rs.220.
October 12, 2006
9 of 18
India Infoline – Getting better with diversification
Company profile
India Infoline Ltd (IIL) started in 1995 with providing Online Media and Content
services. Mr. Nirmal Jain and Mr. Venkataram, the founder members of the
company sensed the growing opportunities in the market and increased the
horizon for IIL from time to time. IIL with an aim to become 'One stop for all
financial needs' started with equity and commodity broking, distribution of
financial products and now with investment banking.
IIL has a huge branch network across 95 cities, which it leverages for customer
acquisitions, relationship building, retail advisory and distribution services.
Graph 7: Milestones achieved
2006
Investment Banking & Loan
Distribution
2004
Commodities Trading
2000
Broking Insurance &
Distribution
1995
Content Prov ider
Source: Company Data, PL Research
IIL is in the expansion mode and plans to set up 350 branches by FY07E. It
also plans to set up branches in cities like Dubai, Singapore and London to
serve the NRI's for PMS service. It has recently opened up a branch in Kuwait
and expects this branch to contribute to the equity broking business.
IIL has just received Investment banking license: with this they expect to enter
the market with an intention to target the SME sector.
It also plans to launch a Venture capital fund
10 of 18
October 12, 2006
India Infoline – Getting better with diversification
Graph 8: Business Area at India Infoline
INDIA
India Infoline
Securities Pvt Ltd
Equity
Broking
PMS
Investment
Banking
India Infoline
Distribution Co. Ltd
Mutual Fund
Fixed Deposits
RBI Bonds
INFOLINE
India Infoline
Insurance Service Ltd
Corporate
Agent for
ICICI
Prudential Life
India Infoline
Investment
Services Pvt Ltd
India Infoline
Commodities
Pvt Ltd
Margin
Funding
Commodity
Broking
Distribution of
Mortgages
and Personal
Loans
Source: Company Data, PL Research
Geographical presence
IIL has pan-India presence across 94 cities. It started off with major branches
in metros and now it is focusing on Tier II and III cities. In Q1-FY07 the company
opened 56 branches, taking the total number of branches to 233 as on June
2006
Almost 50% of the revenue comes from centers in Maharashtra and Delhi,
followed by other regions.
Graph 9: State wise contribution to the topline
40%
30%
20%
10%
KERALA
R'STHAN
K'TAKA
WB
PUNJAB
MP
UP
A.P
TN
GUJARAT
DELHI
MAHA
0%
Source: Company Data, PL Research
October 12, 2006
11 of 18
India Infoline – Getting better with diversification
Business Analysis
Equity Broking
India Infoline significant presence in retails segment. It offers both online and
offline broking facilities. It has utilized technology to bring the convenience of
trading to the investor's preferred location through computerized access.
In the last two years it has built up a client base of 100,000 by June'06, about
87% online. It provides broking service in cash as well as in the derivatives
segment. Average daily volumes witnessed in FY06 were Rs 4,560mn signifying
almost 1.2% of the market.
Broking income also includes the brokerage they earn on PMS activity, where
the average ticket size is Rs.5 lakhs. With rising volumes in the market, IIL also
witnessed buoyant increase in the average daily turnover, increasing their broking
income to Rs 1,427 mn in FY06.
Addition of 160 branches, last year increased customer base by around 1363%,
showing an upward trend in customer per branch. This signifies that both new
and existing branches are adding to the expansion of client base.
Increase in customers is not
reflected in volumes traded
for the company
Graph 10: Trend of Customer per branch and Turnover per client
Customer per Branch (Units)
Turnover per Customer (Rs m) (RHS)
160
450
400
350
300
250
200
150
100
50
0
140
120
100
80
60
40
20
0
FY05
Q1FY06
Q2FY06
Q3FY06
FY06
Source: Company Data, PL Research
Turnover per client has been moving southwards; signifies that large portion of
the customers acquired are not active or are low-ticket size clients. Low turnover
per client also decreased income per client.
12 of 18
October 12, 2006
India Infoline – Getting better with diversification
Insurance Distribution Business
Since 2000, India Infoline has been a corporate agent for ICICI Pru Life. It
contributes about 5% to total ICICI Pru's premium collection. With its vast
branch network, 2,000 trained employees and a good client base, it becomes
easy to cross-sell products.
IIL has been showing impressive growth in premium collection of over 266%yoy.
Similarly it witnessed 261% yoy growth in revenue from the insurance
distribution in FY06. India Infoline enjoys a 44% EBIDTA margin in the insurance
segment.
Graph 11: Premium and commission on rise
1,200
WAPI
Insurance Commission (RHS)
1,000
250
200
150
600
100
(Rs m)
(Rs m)
800
400
50
200
0
0
FY04
FY05
FY06
Source: Company Data, PL Research
Foray into general insurance distribution
IIL has applied to IRDA for a license as an insurance broker, by this it intends
to distribute both life and general insurance products across the companies.
We expect IIL to start acting as an insurance agent from FY08 onwards, thus
higher contribution from insurance distribution is expected.
Distribution of Mutual fund and other loan products
IIL is leveraging its branch network to distribute mutual fund, fixed income
products, RBI Bonds, mortgage and personal loans
Mutual funds distribution forms 90% in this mobilization business. IIL
mobilized Rs.31, 000 mn in FY06, a yoy growth of 72%
October 12, 2006
13 of 18
India Infoline – Getting better with diversification
Graph 12: Funds mobilized and income generated
35,000
Funds mobilised
Distribution Income (RHS)
30,000
250
200
20,000
150
15,000
100
(Rs m)
(Rs m)
25,000
10,000
50
5,000
-
FY04
FY05
FY06
Source: Company Data, PL Research
With interest rates falling to their lowest in the last decade, rising income levels
and higher returns from the equity market, mutual funds have come to the
fore. The sector has grown at a fairly strong 30% yoy.
With no drastic volatility expected in the market we expect mutual fund business
will also move in tandem with market.
IIL has recently entered into distribution of home loans with acquisition of
75% stake in Money tree consulting. IIL now distributes personal and home
loans for Kotak Mahindra Bank, IDBI, Citibank and ICICI.
Commodity Broking
IIL started with commodity broking in 2004. Since then, commodity revenues
have increased by 754% yoy to Rs.41mn. IIL foresee lot of opportunity in this
sector. The sector itself is at a nascent stage, where it takes efforts to make
people understand the dynamics of commodity business.
IIL is member of MCX and NCDEX and is awaiting Dubai Gold Exchange
Membership.
Currently contribution of commodity segment to the topline is insignificant,
but we expect the contribution to increase to 4% by FY08.
IIL caters to 600 clients in this segment, mainly in Gujarat and Rajasthan with
500 employees. IIL is planning to set up more 30 branches in Gujarat in addition
to 20 branches.
Turnover has quickly picked up with average monthly turnover hovering to Rs
1bn. IIL also offers commodity research, and maintains its site
www.5paisa.commodities.com, keeping its investors updated on latest
happenings.
14 of 18
October 12, 2006
India Infoline – Getting better with diversification
Financial Analysis
(Rs m)
Table 3: Key assumptions
FY05
FY06
FY07E
FY08E
Expansion
Branches (units)
Customer base (no)
73
177
350
430
5,500
75,000
168,000
240,800
Broking
Avg daily volumes
Average brokerage
Turnover per client
1,648
4,560
7,857
9,270
12 paisa
12 paisa
12 paisa
12 paisa
151.0
28.6
20.0
16.5
Insurance (%)
Pvt sector participation
Growth in India Infoline's WAPI
22.0
29.0
33.0
37.0
-
267.0
109.0
80.0
18,000
31,000
45,550
66,900
83
430
900
1,130
31.4
26.4
22.1
19.0
Mutual Fund
Funds mobilised
Commodity Broking
Avg daily volumes
Expenses (as % of revenue)
Direct cost
October 12, 2006
Employee cost
13.6
17.2
22.0
19.8
Admin cost
16.9
17.9
20.0
21.0
15 of 18
India Infoline – Getting better with diversification
Financials
(Rs m)
Income Statement
Y/e March
FY05
FY06
FY07E
64
201
331
480
Equities Brokerage
511
1,427
2,382
2,823
Distribution Commission
118
200
310
469
Online & Media Income
Substantial growth in
insurance and commodity
segment
Commodities Brokerage
Life Insurance Commission
FY08E
5
41
129
194
60
216
460
817
General Insurance Premium
-
-
-
67
Financing Activity
-
47
223
340
Home loan Commission
Operating Income
-
2
12
21
757
2,134
3,847
5,210
Expenses
Direct Cost
% of Revenue
849
988
22.1
19.0
103
366
842
1,032
% of Revenue
13.6
17.2
21.9
19.8
128
383
781
1,217
16.9
17.9
20.0
21.0
Preliamnary Expenses
0.4
0.2
-
-
Total Expenditure
470
1,312
2,473
3,237
62.0
61.5
64.3
62.1
288
822
1,374
1,973
38.0
38.5
35.7
37.9
25
86
167
236
% of Revenue
% of revenue
EBITDA
EBITDA margin (%)
Depreciation
EBIT
263
737
1,207
1,737
Interest
20
65
193
332
Other Income
15
46
51
56
258
718
1,065
1,461
PBT
Tax
41
229
362
511
PAT
217
489
703
950
15.9
31.9
34.0
35.0
Effective tax rate (%)
16 of 18
563
26.4
Employee cost
Admin Expenses
EBITDA Margin to be under
pressure, backed by growth
plans
238
31.4
October 12, 2006
India Infoline – Getting better with diversification
(Rs m)
Balance Sheet
Y/e March
FY05
FY06
FY07E
Equity Capital
316
451
451
451
Reserves & Surplus
206
1,492
1,795
2,270
Total Borrowings
542
1,836
3,864
5,535
8,256
Total Liabilities
FY08E
1,064
3,778
6,110
Gross block
88
298
696
907
Less; Accumalated Depreciation
54
123
323
559
Net fixed Assets
34
175
373
348
Net Intangible Assets
27
39
45
50
1
240
3
1
Current Assets
1,491
6,105
9,818
12,827
Sundry debtors
1,149
3,579
6,237
7,498
2,850
Invetsments
Cash and Bank
173
804
1,549
Others
169
1,722
2,032
2,479
less; Current Liab & Prov
507
2,792
4,129
4,975
Sundry creditors
460
2,456
3,742
4,499
Provisions
47
336
386
476
984
3,313
5,689
7,854
Deffered tax assets
2
10
-
3
Loss carried forward
16
-
-
-
1,064
3,778
6,110
8,256
FY05
FY06
FY07E
FY08E
118.3
181.8
80.2
35.4
62.0
61.5
64.3
62.1
184.5
185.9
67.1
43.6
Net current Assets
Total Assets
Key Ratios
Y/e March
Growth Ratios (%)
Revenues
Total Expenses
EBIDTA
Other Income
17.1
203.1
10.0
10.0
-
125.6
43.6
35.2
ROE
41.5
25.2
31.3
34.9
ROCE
29.4
22.6
16.5
15.4
EBIDTA Margin
38.0
38.5
35.7
37.9
PAT
Profitability Ratios (%)
Per Share (Rs)
EPS
6.9
10.8
15.6
21.1
CEPS
7.7
12.4
19.3
26.3
BVPS
16.5
43.1
49.8
60.3
P/E
26.0
16.4
11.5
8.5
Price / BV
10.7
4.2
3.9
3.0
Market Cap / Sales
10.6
3.8
2.1
1.5
Valuation Ratio (x)
October 12, 2006
17 of 18
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PL’s Recommendation Scale
BUY
: > 15% Outperformance to BSE Sensex
Market Performer : -5 to 5% of Sensex Movement
Sell
Outperformer
: 5 to 15% Outperformance to Sensex
Underperformer : -5 to -15% of Underperformace to Sensex
: <-15% Relative to Sensex
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