We estimate TRCL to deliver 23.8% EBITDA CAGR during FY19-21E. TRCL is prudently expanding its cement capacity by 25% over next two years, funded mainly through its strong internal accruals. While TRCL remains a regional player, we ascribe it premium valuations of 13x EV/EBITDA (for its strong retail presence and robust profitability metrics) on FY21E standalone EBITDA, leading to TP of Rs 800/share (implies EV/MT of USD Rs 170). As the stock is fairly valued, we maintain Neutral rating on the stock. We retain NEUTRAL rating with TP of Rs 800 (13x FY21 EBITDA). Our TP implies EV/MT of USD 170/MT.

eClerx has witnessed three consecutive years of USD revenue stagnation with declining profitability & cash generation. Return ratios have stumbled, RoE is at 18% (vs. >30% in FY17). The structural change in eClerx' operating model (shift to onshore) has resulted in EBIT margin contraction from 31% to 18.5% with onshore rev% increasing from 13% to 22% in the last two years. We reckon that the shift to onshore will continue given the on-site heavy (North Carolina center expansion) digital projects coupled with low demand for traditional KPO services which are at risk of getting automated. We remain cautious on high concentration (68% of rev from T-10 accounts), shorter duration projects providing limited visibility, lower quality of revenue mix and growth lag to onsite investments. We factor USD rev growth of 7.9/8.6% with stable EBIT% at 18.8/19.2% for FY20/21E. We believe revenue growth assumptions are optimistic given the limited visibility and challenging macro environment. Risks to our thesis include traction in digital portfolio and increased offshoring. We maintain SELL on eClerx post an in-line 4Q on revenues and better operating performance. We cut P/E multiple to 11x (vs. 13x) amid near term headwind to margins and lesser visibility on revenue growth.

Over last 2yrs DLF has achieved significant BS deleveraging with net D/E likely hitting 0.1x by FY20E end. Pre-sales recovery is on track with 4.7yrs of unsold completed inventory. DLF maintained that it will launch projects during advance stage of completion. Hines JV is on track with construction commencement by Dec-19. Sales strategy here will be mix of strata sales and leasing. DLF phase V ~2-2.5mn sqft new construction will start in Dec-19 and will cater to Crest type product. With strong balance sheet, robust lease momentum and residential pre-sales recovery, DLF is well placed. We maintain BUY. Key risks (1) Delay in ready inventory monetization (2) High interest rates (3) Rental correction. We maintain BUY post an encouraging quarter. Our SOTP-based TP has reduced to Rs 258 (vs Rs 264 earlier). We have increased our FY20/21E EPS by 19.8/50.2%, led by debt rationalization post QIP, promoter fund infusion and reduction in DCCDL dues post 2HFY20E.

While strict adherence to land acquisition norms of 90/80% in EPC/HAM projects has resulted in delays in getting Appointed Dates, it has also helped in preventing time and cost overruns. The new EPC model concession agreement (MCA) made bidding tougher and costlier. Hence bid aggression reduced, with developers exercising caution. With multiple headwinds faced by the sector during FY19, we believe the curing is now over and better times are due. After hitting a lifetime high in roads tenders in FY18 (Rs 1.2tn), infrastructure stocks suffered a severe de-rating from early FY19. This resulted in avg. valuation multiples contracting from 13.5x 1-yr fwd to 6x.

The worries related to supply constraints, Iran/Yemen geopolitical uncertainty, and raw material prices are either priced in or resolved, in our view. Moreover, Cipla has surpassed its US business guidance of US$ 125mn run rate in 4QFY19. We believe it was crucial for Cipla to cross the US$ 120mn revenue mark to breakeven in the segment. Going into FY20/21E, we expect the US momentum will continue to drive profitability, while launches like gProventil could provide a further boost. Overall, we model 12/16/24% CAGR in revenue/EBITDA/PAT over FY19-21E. At CMP the stock is trading at 26/20x FY20/21E P/E, which is a premium to generic peers. The premium is justified due to a richer mix. We maintain BUY on CIPLA following a modest beat to our estimates. Our TP is revised at Rs 625/sh (22x FY21E EPS). We believe most of the concerns are allayed.

A key concern for investors over the last 2 years has been that there is no growth in air coolers. We remain contrarians, as we believe performance was primarily impacted due to seasonality factors rather loosing market share by Symphony. Summer 2019 confirms our thesis that there are 2 types of consumers in India (AC and Air cooler). A consumer will purchase coolers when summer is strong (impulse based). With trade inventory now at lower levels, Symphony will enjoy off-season stocking, opportunity to launch tech-rich coolers and benefit from a favorable base. Besides, its international performance will improve given the various initiatives undertaken Symphonys weak 4Q performance was largely in-line, given the spillover impact from an erratic summer in 2018. We remain constructive driven by positives like (a) Beat on domestic volume growth, (b) Clearance of channel inventory, (c) Healthy 1Q offtake across geographies (few exceptions like NCR, part of Rajasthan) and channels, and (d) New launches returned after a gap of 2 years. Our estimates cut by 5% to factor weak CT performance. We value the co. at 45x on Mar-21 EPS, arriving at a TP of Rs 1,643. We believe at current price, the risk-reward is favorable.

Crompton has been focusing on building long term structural platform (distribution) rather than reaping low hanging fruits. Management is focusing on (1) Strengthening leadership in fans (NPD for wider price points, offering 5 year warranty vs. 1-2 year by peers), (2) Leveraging distribution (GTM benefits), (3) Brand leveraging via entering in newer categories and (4) Cost reduction and product mix to drive margins. We model 20% EPS CAGR over FY19P-21E. Maintain BUY. Cromptons 4Q performance was mixed with miss on ECD margins (challenging quarter) but beat in lighting margins (recovered with various initiatives). We expect FY20 performance to improve led by (1) Healthy growth for ECD (new launches), (2) Lighting sustaining healthy margins (200bps YoY expansion in FY20E) and (3) GTM benefits kicking-in. Stock was flat in FY19 due to lack of fireworks in their performance. We expect a re-rating in the stock in FY20 (led by outperformance vs. peers). We value at 35x on Mar-21 EPS, arriving at a TP of Rs 300.

Worries on asset quality post the IL&FS exposure are mostly in the price now. The (1) Lower than feared exposure to potentially stressed groups, (2) Contracted SMA II, and (3) Alleviation of concerns on fee income recognition are heartening. We thus retain our target multiple at 3.5x. The acquisition of a hi-growth, hi-yielding business (BHAFIN) holds profitable and synergistic promise. Leadership succession is also a medium term monitorable. As expected, IIBs P&L; was significantly hit by its exposure to the stressed IL&FS; group. However, core operating metrics remain largely intact. The exposure to other potentially stressed groups is a monitorable. Maintain BUY with a TP of Rs 1,964 (3.5x Mar-21 ABV of Rs 561).

Strong return ratios (RoIC to improve from 18.9% in FY19 to 19.8% in FY21E), gain in market share in Methyl Amines and its derivatives and a prudent management make AACL an attractive bet at current valuations (trading at 13.4 FY21E EPS). We are valuing AACL at 22x Mar'21E EPS and maintain a BUY rating with a TP of Rs 1,313. Strong return ratios (RoIC to improve from 18.9% in FY19 to 19.8% in FY21E), gain in market share in Methyl Amines and its derivatives and a prudent management make AACL an attractive bet at current valuations (trading at 13.4 FY21E EPS). We are valuing AACL at 22x Mar'21E EPS and maintain a BUY rating with a TP of Rs 1,313. Despite an underwhelming Q4FY19 performance, we urge investors to keep their faith intact in AACL owing to the (1) Impending gain in market share in the Methyl Amines space, (2) Expanding margins as the share of derivatives in the total product mix increases. Maintain BUY

We re-iterate BUY as (1) Subros has gained market share to 42% in a slowing market (up by 2%) (2) The company is deleveraging its balance sheet. They have already paid down Rs 1.2bn from the equity infusion by Denso (3) The share of passenger car AC's will reduce to 70% (from 80% currently) as the other segments (CV's, railways and home AC) ramps up. Subros reported a weak 4Q due to the ongoing sluggishness in the passenger car industry. However, we believe that the company is adopting an astute strategy by increasing its share of non passenger car AC business and deepening its relationship with its Japanese partner Denso. We re-iterate our BUY on the stock (TP of Rs 310) and we continue to value the stock at 17x on FY21 EPS.

We reiterate BUY with a TP of Rs1,162 (10x FY21 consol EBITDA). Our TP implies EV/MT of USD 92. We continue to like JKCE owing to its large exposure to the lucrative white/putty business (55% of consol EBITDA) and JKCEs expanding grey cement capacity in the strong pricing north/central markets. Healthy cash generation should keep net D/E to remain at/below 1x and net debt/EBITDA below 3x despite ongoing expansions, in our view. We reiterate BUY with a TP of Rs1,162 (10x FY21 consol EBITDA). Our TP implies EV/MT of USD 92.

Opportunistic and tactile lending by an astute management along with increasing retailisation underpins our constructive stance on Indostar. While critics are wary of its real estate and structured finance exposure, calculated repayment rates and immaculate asset quality should dispel concerns. Current attractive valuations (<1x Mar-21E ABV) imply significant deterioration in corporate asset quality, which we believe is unlikely. We have reduced ABV to factor portfolio acquisition goodwill. We maintain BUY on INDOSTAR (TP of Rs 520, 1.5x Mar-21E ABV of Rs 347) after an in-line 4Q and, incredibly, an improvement in corporate asset quality.

Healthy margin expansion of ~400bps over two years has led to re-rating of the stock. But now, with limited margin levers available, focus will shift back to growth, which is under pressure (+4.2% in FY19, second lowest in Tier-1 IT). Slowing growth in Enterprise, challenges in Manufacturing and BFSI is adding to the worries. Also, sustainability of Telecom growth is questionable considering macro concerns. Overall, we expect USD revenue CAGR of 7.2% over FY19-21E led by Telecom/Enterprise CAGR of 8/7%. Growth and margin challenges will lead to 5.4% earnings CAGR over FY19-21E. TechM trades at a P/E of 15.6x FY20E, which is expensive considering inferior growth metrics, thus we downgrade it to SELL. Risk to our thesis includes better than expected macros in US/Europe, uptick in 5G spending and INR depreciation. We downgrade Tech Mahindra to SELL (from BUY), post weak 4QFY19. Slowdown in Enterprise segment and peaking margins are a cause of concern. Growth metrics remain weak (+5.4% earnings CAGR) with inferior business mix vs. peers (Telecom dependency). We cut earnings est. by ~4% and multiple to 12x (vs 15x earlier) to arrive at a TP of Rs 652 (~15% downside from CMP).

We expect BPCL's core EBITDA (adjusted for inventory and forex gains/losses) growth to lag peers' in the absence of refining capacity expansion. Besides, the interest cost will increase as a consequence to jump in debt. We downgrade to NEUTRAL with a SOTP target of Rs 409/sh (5.5x Mar 21E EV/e for standalone refining, 6.0x Mar 21E EV/e for marketing and pipeline businesses plus Rs 129/sh for other investments). We like BPCL owing to its impeccable refining assets. However, it is in the weakest spot among OMCs, with no refining capacity addition in foreseeable future and increase in interest cost on account of increasing debt. Hence, we downgrade to NEUTRAL.

HPCL is doubling its existing capacity at the Visakh refinery from 8.3mmtpa to 15mmtpa by FY21 (Outlay Rs. 210bn) and increasing it from the current 7.5mmtpa to 9.5mmtpa (Outlay Rs 50bn) at its Mumbai refinery. This will drive the earnings of the refinery business. OMCs could not take any price hike to compensate for the rising product prices till mid-May in an election-packed environment. Now onwards, normative margins will be restored allowing HP to be the largest beneficiary as its earnings are highly sensitive to changes in the marketing margins (EBITDA contribution of ~60% vs 55/44% for BP/IOC). Our SOTP target is Rs 346 (6x Mar 21E EV/e for standalone refining and pipeline, 7x EV/e for marketing and Rs 57/sh from other investments). We prefer HPCL among the OMCs given the (1) Impending 55% refinery capacity addition to 24.5mmt by FY21E, vis-a-vis no visibility on additional capacities for other OMCs (2) Restoration of marketing margins post elections that will benefit HPCL the most as this business contributes ~60% to its EBITDA. Maintain BUY.

We believe TRP is not in faults for discontinuing the sales of two sartan products in the US as the USFDA has changed its rules related to sartan impurities frequently over FY19. Despite cutting our FY20/21E EPS estimates by 14/13% and downgrading the stock to Neutral on account of US, we maintain our target multiple at 24x P/E, as we remain constructive on TRP's lucrative India business which we value at Rs ~1,200/sh (70% of CMP). We believe the growth in India and other businesses will enable TRP to shed ~Rs 16bn net debt over the next two years, aiding ~35% EPS CAGR. Any overreaction on the stock in the near term should be taken as an opportunity to enter. We downgrade TRP to NEUTRAL following a 13% earnings cut owing to several headwinds in the US biz, which will persist over the next 4-6 quarters, in our view. Our revised TP is Rs 1,745/sh (24x FY21E EPS).

We are structurally positive on IOC, owing to its diversified business model, and healthy free cash flows (Rs 285bn) over FY20-21E. Our SOTP based target price of Rs 190 (5x Mar 21E EV/e for standalone refining, pipeline, petchem and 5.5x Mar 21E EV/e marketing and Rs 31/sh from other investments). With an improvement in GRMs in sight coupled with restoration in marketing margins as elections have concluded, we remain positive on IOC and maintain BUY.

Given the (1) Muted earnings growth prospects, (2) Declining return ratios (ROE: 19.4/15.3/15.4%, RoIC: 30.0/26.3/26.9 in FY19/20E/21E), we prefer Alkyl Amines over Balaji in the Amines space Owing to a disappointing performance in Q4FY19, we cut our valuation multiple from 17x to 13x (Mar-21E consolidated EPS) and arrive at the target price of Rs 525/sh. This is on account of (1) Consistently poor volume growth, (2) Vagueness on imposition of Anti-dumping duty on Di-methyl Formamide (DMF), resulting in significantly low capacity utilizations (currently at ~45%), (3) Deferment of capacity augmentation projects to FY21.

SDL has ~17.5mn sqft of unsold area in ongoing projects and expects to add 4.2mn sqft from new projects in the pipeline. A well diversified product mix across different regions augurs well for pre-sales recovery. Brand pull will certainly aid pre-sales efforts. Despite capex commitment of Rs 10bn we expect consolidated net D/E to reduce to 0.9x by FY21E (vs. 1.09x now). The contracting business is seeing good growth with an order book of Rs 26bn. We maintain BUY. Key risks: (1) Further deterioration in NBFC liquidity, (2) Higher interest rate, (3) Weak order inflow in the contracting business; and (4) Delay in regulatory approvals. We maintain BUY post a robust quarter. Our SOTP-based TP has increased to Rs 652 (vs Rs 646 earlier). We have increased our EPS estimate by 3/3.3% for FY20/21E.

We estimate SRCM's margins to firm up to ~Rs 1,200/MT during FY20-21 (from Rs 1,000/MT in FY19), while it continues to deliver industry leading 10%+ volume CAGR. Lean capital employed further ensures sustenance of healthy return ratios. We retain NEUTRAL rating with SOTP based TP of Rs 19,040, as robust outlook is priced in. We retain NEUTRAL rating with TP of Rs 19,040 (SOTP based: Cement/power businesses at 15/5x FY21 EBITDA, and its UAE subsidiary - Union Cement - at 1x acquisition cost). Our TP implies cement EV/MT of USD 213/MT.