16 May 2020
4QFY20 Results Update | Sector: Healthcare
Cipla
Estimate change
TP change
Rating change
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
CIPLA IN
805
459.7 / 6.1
632 / 356
-6/46/19
1964
CMP: INR570
TP: INR550 (-4%)
Neutral
Lockdown lowers growth prospects in DF/overall earnings
Enhancing Respiratory pipeline for US on track
Financials & Valuations (INR b)
Y/E MARCH
2020 2021E 2022E
171.3 182.5 202.7
Sales
32.1 37.2 43.0
EBITDA
15.8 19.3 22.9
Adj. PAT
EBIT Margin (%)
12.0 13.7 14.4
19.6 24.1 28.6
Cons. Adj. EPS (INR)
4.8 22.7 18.7
EPS Gr. (%)
207.1 228.4 253.3
BV/Sh. (INR)
Ratios
Net D:E
0.1
0.0 -0.1
9.4 10.5 11.3
RoE (%)
8.6
9.9 10.6
RoCE (%)
Payout (%)
15.6 12.5 12.6
Valuations
28.9 23.6 19.8
P/E (x)
14.8 12.3 10.3
EV/EBITDA (x)
Div. Yield (%)
0.4
0.4
0.5
FCF Yield (%)
4.5
4.4
4.3
2.8
2.5
2.2
EV/Sales (x)
COVID-19-led lower-than-estimated performance
The EBITDA margin trajectory has been on the downtrend for the past four
quarters, partly due to increased competition in potential products. The
intensity further increased in 4QFY20 due to COVID-19.
Cipla’s Respiratory product pipeline for US Generics is shaping up well,
providing growth visibility over the next two to three years. Also, efforts to
improve synergies across the Prescription, Trade Generics, and Consumer
portfolios for the India business have started to yield results.
However, we cut our EPS estimates by 7.5%/3% for FY21/FY22 to factor the
lockdown-led decline in the Domestic Formulations (DF) business. We
maintain our price target at INR550 as we roll out our price target on a 20x
12M forward basis. Maintain Neutral, as the valuation factors a potential
upside in earnings over the medium term.
4QFY20 revenues were flat YoY at INR43.7b (our est.: INR43.1b) as 12% YoY
growth in India (40% of sales) was offset by decline in US sales (down 27%
YoY; 20% of sales at USD118m) and EU sales (down 1% YoY; 5% of sales), and
muted growth in the SAGA business (19% of sales). Within SAGA, the South
Africa Private Market business grew 10% YoY in the local currency rate.
The gross margin (GM) contracted ~180bp YoY (-100bp QoQ) to 61.4% due
to a change in the product mix. The EBITDA margin contracted further by
~740bp YoY to 14.4% due to lower operating leverage (employee/other
expenses (+130bp/120bp YoY as a percentage of sales). EBITDA declined
~34% YoY to INR6.3b (v/s est. of INR7.7b).
Adj. PAT declined at a higher rate of ~46% YoY to INR2.7b (v/s our est. of
INR3.6b), weighed by a higher tax rate.
For FY20, sales/EBITDA/PAT grew 5%/4%/5% to INR171b/INR32b/INR15.7b,
led by moderate performances in key geographies: India/US.
Lockdown impacted sales of INR2b for 4QFY20. The decreased share of high-
margin businesses, coupled with cost related to remediation toward the Goa
facility, dragged down the EBITDA margin by 200bp for the quarter.
Cipla has guided for moderation in R&D spend for FY21.
Albuterol is a 60m unit market. The market is interchangeable between
gProair and gVentolin. Another player is in queue to acquire approval for
Albuterol.
Capacity utilization is up by 80–85% against that in the lockdown scenario.
We expect 21% earnings CAGR, led by niche launches in US Generics and
improved growth through renewed strategy in Domestic Formulations. We
continue to value Cipla at 20x 12M forward earnings to arrive at a price
target of INR550. Maintain Neutral, as the valuation leaves limited scope for
return from current levels.
Shareholding pattern (%)
As On
Promoter
DII
FII
Others
Dec-19 Sep-19 Dec-18
36.7
36.7
36.7
20.9
17.6
13.7
20.4
24.3
25.9
22.1
21.5
23.7
Highlights from management commentary
FII Includes depository receipts
Valuation and view
Research Analyst: Tushar Manudhane
(Tushar.Manudhane@motilaloswal.com); +91 22 5036 2498
Hitakshi Chandrani
(Hitakshi.Chandrani@MotilalOswal.com); +91 22 6129 1557 /
Bharat Hegde
(Bharat.Hegde@motilaloswal.com)
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Investors are advised to refer through important disclosures made at the last page of the Research Report.
 Motilal Oswal Financial Services
Cipla
Quarterly perf.(consol.)
Y/E March
Net Revenues
YoY Change (%)
Total Expenditure
EBITDA
YoY Change (%)
Depreciation
EBIT
YoY Change (%)
Interest
Other Income
Profit before Tax
One-time (expense)/inc.
PBT after EO expense
Tax
Rate (%)
Minority Interest
Reported PAT
Adj PAT
YoY Change (%)
Key perf. indicators (consol.)
Y/E March
INR m
Domestic formulation
YoY Change (%)
North America
YoY Change (%)
Europe
YoY Change (%)
South Africa
YoY Change (%)
Emerging market
YoY Change (%)
API
YoY Change (%)
Cost Break-up
RM Cost (% of Sales)
Staff Cost (% of Sales)
R&D Expenses(% of Sales)
Other Cost (% of Sales)
Gross Margins (%)
EBITDA Margins (%)
EBIT Margins (%)
1Q
39,390
11.7
32,126
7,264
12.2
2,410
4,854
11.9
351
551
5,056
1,150
6,206
1,737
34.4
-45.7
4,515
3,640
-11.1
FY19
2Q
3Q
40,119 40,075
-1.7
2.4
33,097 32,999
7,022
7,077
-12.7
-13.6
2,819
2,931
4,203
4,145
-16.3
-11.8
444
442
506
785
4,265
4,489
820
0
5,085
4,489
1,424
1,257
33.4
28.0
-109.2
-90.0
3,770
3,322
2,950
3,322
-30.2
-13.8
4Q
44,040
19.1
34,429
9,611
72.6
3,003
6,608
142.9
448
954
7,114
-2,100
5,014
1,278
18.0
64.0
3,672
5,120
53.5
1Q
39,890
1.3
30,844
9,046
24.5
2,680
6,366
31.2
521
784
6,629
0
6,629
1,922
29.0
-75.4
4,782
4,782
31.4
FY20
2Q
3Q
43,958 43,710
9.6
9.1
34,863 36,127
9,095
7,583
29.5
7.2
2,830
2,779
6,265
4,804
49.1
15.9
461
462
1,005
721
6,810
5,064
-
0
6,810
5,064
2,006
1,528
29.4
30.2
90.9
25.5
4,714
3,510
4,714
3,510
59.8
5.7
FY19
FY20
4Q
43,762 1,63,624 1,71,320
-0.6
7.5
4.7
37,427 1,32,651 1,39,260
6,335
30,973 32,060
-34.1
9.6
3.5
3,134
11,163 11,423
3,201
19,810 20,637
-51.6
18.1
4.2
530
1,684
1,974
932
2,796
3,442
3,603
20,922 22,105
-324
-130
-324
3,279
20,792 21,782
856
5,695
6,312
23.8
27.2
28.6
-36.4
-181.6
4.6
2,460
15,278 15,465
2,747
15,032 15,752
-46.4
-3.1
4.8
Est.
4QE
43,062
-2.2
35,345
7,717
-20
2,840
4,877
-26
473
790
5,194
0
5,194
1,416
27.3
159.0
3,619
3,619
-29.3
(INR m)
% Var
1.6
-17.9
-36.9
-32.0
-24.1
1Q
15,440
21.5
6,696
3.7
1,340
(15.2)
5,762
18.1
8,142
(2.3)
2,010
54.6
37.0
18.6
7.0
20.9
63.0
18.4
12.3
FY19
2Q
3Q
16,440
15,850
(0.1)
(1.0)
7,580
8,490
22.7
30.6
1,410
1,890
(6.6)
10.5
5,030
5,570
(4.5)
7.1
7,950
6,750
(14.4)
(18.1)
1,710
1,540
(19.7)
4.1
35.2
17.8
7.9
21.7
64.8
17.5
10.5
36.5
17.9
7.5
20.5
63.5
17.7
10.3
4Q
15,420
14.0
11,430
53.2
2,360
73.5
8,220
54.2
4,060
(53.1)
1,740
28.9
33.7
16.2
6.8
21.5
66.3
21.8
15.0
1Q
13,550
(12.2)
11,190
31.8
2,010
50.0
5,320
(7.7)
5,980
(26.6)
1,820
(9.5)
30.0
19.0
6.5
21.8
70.0
22.7
16.0
FY20
2Q
3Q
17,450
17,770
6.1
12.1
9,530
9,460
(16.6)
(15.5)
1,900
1,900
34.8
0.5
5,460
5,940
8.5
6.6
8,040
7,000
1.1
3.7
1,570
1,650
(8.2)
15.0
33.2
17.3
6.7
22.0
66.8
20.7
14.3
37.6
17.1
7.0
20.9
62.4
17.3
11.0
4Q
17,300
12.2
8,560
(10.2)
2,320
(1.7)
8,250
0.4
4,150
2.2
2,470
42.0
38.6
17.5
7.1
22.4
61.4
14.5
7.3
FY19
64,200
9.4
34,210
32.2
7,020
12.7
31,900
56.4
17,400
(50.0)
7,010
12.0
35.4
17.5
7.2
21.0
64.6
18.9
12.1
FY20
67,410
5.0
38,740
13.2
8,130
15.8
30,870
(3.2)
14,680
(15.6)
7,520
7.3
35.0
17.7
7.0
21.8
65.0
18.7
12.0
5 February 2020
2
 Motilal Oswal Financial Services
Cipla
Conference call highlights
India’s Rx (branded business) sales grew 12% YoY and Trade Generics +15% YoY
(adjusted for CHL). The Chronic segment was up 12% YoY, in line with market
growth.
Chronic buying, which increased in late March, normalized in April. Channel
inventory, which was running low in the Red zones due to lockdown, is expected
to be back to normal as stockists start to re-open shop.
Lower expenses due to reduced MR activity were partially offset by higher
expenses on COVID-19-related safety measures. Cipla is expected to offer
further clarity in the upcoming quarter.
Cipla has filed another complex inhalation asset. It also has another partnered
asset in late-stage clinical trials.
The company may look at other ways to commercialize IV tramadol to limit its
expenses.
Price erosion in the US continues, albeit at a lower intensity.
Valuation view
US: Better visibility on Respiratory pipeline
Cipla exhibited a 14% CAGR in US revenues to USD547m over FY16–20 on account of
product launches and changed strategy of having a direct-to-market presence. The
high base in FY19 led to moderate growth of 12% for FY20. However, Cipla is geared
up to build a Respiratory franchise in US Generics. In addition to the recent approval
for Albuterol, it has completed Phase-3 clinical trials for gAdvair. Additionally, it filed
another complex inhalation asset in 4QFY20, and a partnered inhalation asset is
undergoing clinical phase 3. Overall, we expect an 18% CAGR in US sales to
USD750m over FY20–22.
DF: Renewed strategy to enhance growth
Cipla delivered muted 7% CAGR in DF sales over FY16–20, partly led by disruption on
account of GST/demonetization and the recent exercise to re-align distributors in
Trade Generics. The Prescription business has been improving, led by strong
performances from both chronic therapies. With a ‘One-India Strategy’, Cipla
intends to increase its portfolio synergies across Rx, Gx, and Consumer products and
see an enhanced benefit in distribution. We expect Cipla to improve its sales CAGR
to 9% over FY20–22.
EU: Reduced hurdles to enable better growth over medium term
Cipla has reported a 7% sales CAGR in Europe over FY16–20, led by serialization
issues at the industry level. With the resolution of this issue, we expect its sales
CAGR to improve to 11% to INR10b over FY20–22E.
Valuation and view
We expect a 21% earnings CAGR, led by niche launches in US Generics and improved
growth through renewed strategy in Domestic Formulations. We continue to value
Cipla at 20x 12M forward earnings to arrive at a price target of INR550. Maintain
Neutral,
as the valuation leaves limited scope for returns from current levels.
16 May 2020
3
 Motilal Oswal Financial Services
Cipla
Exhibit 1: P/E chart
P/E (x)
50.0
40.0
30.0
20.0
10.0
Min (x)
Avg (x)
+1SD
Max (x)
-1SD
6.2
4.9
3.6
2.3
1.0
Exhibit 2: P/B chart
P/B (x)
Min (x)
Avg (x)
+1SD
Max (x)
-1SD
40.9
33.6
27.9
22.1
22.3
15.7
5.0
3.9
2.6
3.3
2.5
1.7
Source: MOFSL, Company, Bloomberg
Source: MOFSL, Company, Bloomberg
16 May 2020
4
 Motilal Oswal Financial Services
Cipla
Story in charts
Exhibit 3: Revenues were muted YoY in 4QFY20
Sales (INR b)
9.7
(3.4)
11.7
3.2
(1.7)
2.4
1.3
Growth YoY (%)
19.1
8.8 7.3
9.6 9.1
(0.6)
14.1
18.4
19.7
Exhibit 4: EBITDA contracted 740bp YoY in 4QFY20
EBITDA (INR b)
20.9
15.1
EBITDA Margin (%)
21.8 22.7 20.7
18.4 17.5 17.7
17.3
14.5
35.8 35.3 40.8 39.1 37.0 39.4 40.1 40.1 44.0 39.9 44.0 43.7 43.8
5.1 6.5 8.0 8.2 5.6 7.3 7.0 7.1 9.6 9.0 9.1 7.6 6.3
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 5: Expect a DF sales CAGR of 9% over FY20–22…
17.0
DF Revenue (INR b)
YoY Growth (%)
Exhibit 6: …and CAGR of 11% in exports over FY20–22
Export Formulations (INR b)
41.9
YoY Growth (%)
5.9
8.0
9.4
6.3
5.0
8.0
10.0
10.9
11.2
2.1
3.7
91
10.0 12.0
2.1
92
102
114
48
51
55
59
64
67
73
80
54
77
86
87
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 7: EBITDA margin to improve gradually…
EBITDA (INR b)
19.1% 18.3%
16.7%
EBITDA Margin
20.4% 21.2%
Exhibit 8: …resulting in better profitability
34.0
EPS (INR)
24.6
4.8
YoY Growth (%)
22.7
18.7
18.6% 18.9% 18.7%
22
25
24
28
31
32
37
43
-18.6
14.0
18.8
-17.7
-3.1
15.5
19.3
18.7
19.6
24.1
28.6
Source: MOFSL, Company
Source: MOFSL, Company
16 May 2020
5
 Motilal Oswal Financial Services
Cipla
Financials and valuations
Income statement
Y/E March
Net Income
Change (%)
EBITDA
Change (%)
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income - Rec.
PBT before EO Items
One-time (Expense)/Income
PBT but after EO Exp.
Tax
Tax Rate (%)
Minority Interest
Income from associates
Reported PAT
Adj PAT
Change (%)
Margin (%)
2015
1,13,454
12.3
21,617
1.3
19.1
5,047
16,570
726
1,226
17,069
527
16,543
4,000
24.2
482
-253
11,808
11,281
-18.6
9.9
2016
1,36,783
20.6
25,011
15.7
18.3
5,417
19,594
710
1,130
20,015
-55
20,070
4,396
21.9
494
-120
15,059
15,114
34.0
11.0
2017
1,45,980
6.7
24,436
-2.3
16.7
9,229
15,207
1,594
2,287
15,900
0
15,900
3,094
19.5
290
-70
12,446
12,446
-17.7
8.5
2018
1,52,200
4.3
28,271
15.7
18.6
11,491
16,780
1,142
3,577
19,214
-2,512
16,702
2,501
15.0
60
-28
14,113
15,511
24.6
10.2
2019
1,63,624
7.5
30,973
9.6
18.9
11,163
19,810
1,684
2,796
20,922
-130
20,792
5,695
27.4
(353)
-171
15,278
15,032
-3.1
9.2
2020
1,71,320
4.7
32,060
3.5
18.7
11,423
20,637
1,974
3,442
22,105
324
21,782
6,312
29.0
(470)
-475
15,465
15,752
4.8
9.2
2021E
1,82,472
6.5
37,224
16.1
20.4
12,205
25,019
1,450
2,950
26,519
0
26,519
7,293
27.5
(300)
-200
19,326
19,326
22.7
10.6
2022E
2,02,704
11.1
42,973
15.4
21.2
13,754
29,220
805
3,250
31,665
0
31,665
8,866
28.0
(250)
-100
22,949
22,949
18.7
11.3
(INR m)
Balance sheet
Y/E March
Equity Share Capital
Reserves
Net Worth
Loans
Deferred Liabilities
Minority Interst
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Investments
Curr. Assets
Inventory
Account Receivables
Cash and Bank Balance
Others
Curr. Liability & Prov.
Account Payables
Provisions
Net Current Assets
Appl. of Funds
2015
1,606
1,06,197
1,07,892
17,018
2846
1927
1,29,684
95,935
27,178
68,757
5,349
6,398
76,201
37,806
20,043
5,643
12,710
27,021
21,215
5,806
49,180
1,29,684
2016
1,607
1,13,555
1,15,162
51,916
8970
3501
1,79,549
1,11,688
4,806
1,06,882
7,410
1,764
94,440
38,081
23,563
8,714
24,082
30,946
27,837
3,109
63,494
1,79,549
2017
1,609
1,23,645
1,25,254
41,126
5888
4382
1,76,650
1,14,562
10,204
1,04,358
7,192
141
96,159
34,853
24,974
6,242
30,090
31,201
27,982
3,219
64,959
1,76,650
2018
1,610
1,40,682
1,42,292
40,980
3157
3524
1,89,953
1,20,454
16,273
1,04,181
5,124
107
1,17,318
40,447
31,025
9,656
36,190
36,776
30,505
6,271
80,542
1,89,953
2019
1,611
1,52,298
1,50,123
43,162
2239
3320
1,98,844
1,26,353
27,436
98,916
3,311
2,963
1,32,429
39,648
41,507
6,188
45,085
38,775
31,408
7,368
93,654
1,98,844
2020
1,613
1,65,347
1,66,959
28,164
1254
2943
1,99,321
1,32,521
38,859
93,662
4,210
3,593
1,26,804
43,776
38,913
10,039
49,365
44,236
34,755
9,482
82,568
1,99,321
2021E
1,610
1,82,257
1,83,867
24,164
1254
2943
2,12,229
1,38,521
51,064
87,457
5,124
3,593
1,52,346
45,156
48,173
22,510
43,982
43,765
34,283
9,482
1,08,581
2,12,229
2022E
1,610
2,02,307
2,03,917
19,164
1254
2943
2,27,278
1,44,021
64,818
79,203
5,124
3,593
1,78,534
50,250
55,541
33,562
46,656
46,649
37,168
9,482
1,31,885
2,27,278
(INR m)
16 May 2020
6
 Motilal Oswal Financial Services
Cipla
Financials and valuations
Ratios
Y/E March
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
RoIC
Working Capital Ratios
Fixed Asset Turnover (x)
Debtor (Days)
Inventory (Days)
Working Capital (Days)
Leverage Ratio (x)
Current Ratio
Debt/Equity
2015
14.0
20.3
134.3
2.0
16.4
40.4
27.9
4.2
4.1
21.6
0.4
10.5
11.0
11.6
1.7
64
122
144
2.8
0.1
2016
18.8
25.6
143.3
2.0
12.0
30.1
22.2
4.0
3.7
20.0
0.4
13.1
10.5
11.2
1.6
63
102
169
3.1
0.4
2017
15.5
26.9
155.7
2.0
15.6
36.6
21.0
3.6
3.4
20.1
0.4
9.9
7.9
7.5
1.4
62
87
162
3.1
0.3
2018
19.3
33.5
176.7
2.0
13.4
29.4
16.9
3.2
3.2
17.2
0.4
10.9
9.4
8.4
1.5
74
97
193
3.2
0.2
2019
18.7
32.5
186.3
3.0
18.6
30.3
17.4
3.0
3.0
15.9
0.5
10.0
8.4
8.0
1.6
93
88
209
3.4
0.2
2020
19.6
33.7
207.1
2.5
15.6
28.9
16.8
2.7
2.8
14.8
0.4
9.4
8.6
8.0
1.8
83
93
176
2.9
0.1
2021E
24.1
39.2
228.4
2.5
12.5
23.6
14.5
2.5
2.5
12.3
0.4
10.5
9.9
10.0
2.0
96
90
217
3.5
0.0
2022E
28.6
45.6
253.3
3.0
12.6
19.8
12.4
2.2
2.2
10.3
0.5
11.3
10.6
11.5
2.4
100
90
236
3.8
-0.1
Cash flow statement
Y/E March
EBITDA
Interest/Dividends Recd.
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
EO expense
CF from Oper. incl EO Expense
(inc)/dec in FA
Free Cash Flow
(Pur)/Sale of Investments
CF from Investments
Inc/(Dec) in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Add: Beginning Balance
Closing Balance
2015
21,617
1,226
-4,244
-5,060
13,539
527
13,012
-9,769
3,242
688
-9,082
4,409
-726
-1,940
-1,782
-39
3,891
1,752
5,643
2016
25,011
1,130
1,728
-11,242
16,627
-55
16,682
-45,603
-28,921
4,634
-40,969
34,898
-710
-1,809
-5,021
27,358
3,071
5,643
8,714
2017
24,436
2,287
-6,176
-3,937
16,609
0
16,609
-6,487
10,122
1,622
-4,865
-10,790
-1,594
-1,936
103
-14,216
-2,472
8,714
6,242
2018
28,271
3,577
-5,232
-12,169
14,447
-2,512
16,959
-9,246
7,713
35
-9,211
-146
-1,142
-1,893
2,321
-860
6,888
6,242
13,130
2019
30,973
2,796
-6,613
-16,580
10,576
-130
10,706
-4,085
6,621
-2,857
-6,942
2,183
-1,684
-2,841
-4,889
-7,232
-3,468
9,656
6,188
2020
32,060
3,442
-7,297
-352
27,853
324
42,819
-7,068
35,751
-629
-7,697
-14,998
-1,974
-2,416
3,406
-15,982
3,851
6,188
10,039
2021E
37,224
2,950
-7,293
-5,728
27,153
0
19,339
-6,914
20,239
0
-6,914
-4,000
-1,450
-2,416
98
-7,768
12,471
10,039
22,510
(INR m)
2022E
42,973
3,250
-8,866
-12,252
25,105
0
25,105
-5,500
19,605
0
-5,500
-5,000
-805
-2,899
150
-8,554
11,051
22,510
33,562
16 May 2020
7
 Motilal Oswal Financial Services
Cipla
NOTES
16 May 2020
8
 Motilal Oswal Financial Services
Cipla
Explanation of Investment Rating
Investment Rating
Expected return (over 12-month)
BUY
>=15%
SELL
< - 10%
NEUTRAL
< - 10 % to 15%
UNDER REVIEW
Rating may undergo a change
NOT RATED
We have forward looking estimates for the stock but we refrain from assigning recommendation
*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within
following 30 days take appropriate measures to make the recommendation consistent with the investment rating legend.
Disclosures
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the
Regulations, is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial
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available on www.motilaloswal.com. MOFSL (erstwhile Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a
registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and
National Commodity & Derivatives Exchange Limited (NCDEX) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National
Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member of Association of Mutual Funds of India (AMFI) for distribution of financial products and Insurance
Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products.
Details of associate entities of Motilal Oswal Financial Services Limited are
available on the website at
http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf
MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and
buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other
compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have
any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report
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https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental
research and Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated
from MOFSL research activity and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.
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This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability
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This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong
Kong Securities and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst
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to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these
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located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For U.S.
Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under
applicable state laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers
Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any
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this document relates is only available to major institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration
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Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOFSL has entered into a chaperoning agreement with a U.S. registered broker-
dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this
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The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S.
registered broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public
appearances and trading securities held by a research analyst account.
For Singapore
In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets
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Specific Disclosures
1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.
2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company
3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months
4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report
5 Research Analyst has not served as director/officer/employee in the subject company
6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months
8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months
16 May 2020
9
 Motilal Oswal Financial Services
Cipla
9 MOFSL has not received any compensation or other benefits from third party in connection with the research report
10 MOFSL has not engaged in market making activity for the subject company
********************************************************************************************************************************
The associates of MOFSL may have:
-
financial interest in the subject company
-
actual/beneficial ownership of 1% or more securities in the subject company
-
received compensation/other benefits from the subject company in the past 12 months
-
other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on
the specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL
even though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report.
-
acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
-
be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the
company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies)
-
received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.
The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report
Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not
consider demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from
clients which are not considered in above disclosures.
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the
research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.
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This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and
may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent
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customers by virtue of their receiving this report.
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The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or
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The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment
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the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and
should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make
modifications and alternations to this statement as may be required from time to time without any prior approval. MOFSL, its associates, their directors and the employees may from
time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to
perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a
separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of
information that is already available in publicly accessible media or developed through analysis of MOFSL. The views expressed are those of the analyst, and the Company may or
may not subscribe to all the views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on,
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expenses that may be suffered by the person
accessing this information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263;
Website www.motilaloswal.com.CIN no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road,
Malad(West), Mumbai- 400 064. Tel No: 022 7188 1000.
Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst:
INH000000412. AMFI: ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company
Ltd. (MOAMC): PMS (Registration No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth
Management Ltd. (MOWML): PMS (Registration No.: INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is
a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt.
Ltd. which is a group company of MOFSL. Private Equity is offered through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL.
Research & Advisory services is backed by proper research. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no
assurance or guarantee of the returns. Investment in securities market is subject to market risk, read all the related documents carefully before investing. Details of Compliance
Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.
* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National
Company Law Tribunal, Mumbai Bench.
16 May 2020
10