15 November 2019 Despite all the hustle in the telecom space, BHARTI surprised with 7% QoQ EBITDA growth to INR88.6b (10% beat without adjusting for Ind-AS 116 impact). Particularly, India mobile EBITDA trended higher (+3% QoQ) for the third consecutive quarter, led by stable domestic wireless revenue (+1% QoQ) despite seasonal weakness. SG&A; costs were down INR6b in the quarter. Moreover, net finance cost declined 9% QoQ to INR29.1b, led by the recent deleveraging efforts. The big dampener this quarter was INR307b exceptional charge toward AGR liability (license fee/SUC) and Africa pre-IPO investor indemnity, which led to a net loss of INR228.3b. loss was at INR11.2b versus our estimate of a net loss of INR14b. Moderating capex intensity down nearly 40% from FY19 to a meager INR88.4b in 1HFY20 (20% below our estimate) coupled with declining debt (excluding AGR liability) led to a reduction in interest cost.

For BS6 compliance, AL is adopting the Mid NOx solution, which is based on iEGR+SCR+DPF, as against the high NOx (SCR+DPF) strategy of competitors. AL's solution requires low EGR and medium SCR, which results in almost half consumption of urea. According to management, this solution is more suited for the Indian conditions, offers better TCO and also high durability. Ashok Leyland AL has developed a new modular platform for BS6 products on which it can offer over 5,000 variants. In BS4, it has three platforms on which it offers ~400 variants. Benefits of modular platform for AL are multi-fold (a) faster time to market and lower development cost, (b) less number of parts, more variants, (c) lesser Takt time despite a 30% increase in complexity in BS6, (d) lesser complexity in manufacturing, (e) leaner inventory and inventory cost, (f) greater reliability and (e) higher economies of scale.

PAT was up ~13% YoY to INR3.6b in the quarter on carrying cost recovery at Noida (~INR150-200m). For 1HFY20, PAT was Profits at Noida rose YoY to INR790m (v/s est. INR450m) on favorable order Distribution franchisees net loss was slightly higher YoY at INR30m (v/s est. Crescent and Surya (RE)s PAT was higher YoY at INR170m (v/s est. Dhariwals net loss stood at INR250m. While YoY (INR630m loss in 2QFY19), the loss may appear lower; the company has noted that it is on account of re- classification and possible adjustments in the previous year. Generation at Dhariwal was 14% lower YoY at 504MUs. Dhariwal has signed a PPA with Maharashtra for 170MW supply of power from Nov19 for a one-year period. Untied generation capacity and scale-up of DFs have a potential to boost earnings. The stock trades attractively at ~8x FY21E P/E even as visibility of earnings at Dhariwal and DFs improve, and factoring in the tightening of norms at Haldia and S/A.

2QFY20 standalone revenue declined 6% YoY to INR48b (in-line). EBITDA declined 38% YoY to INR6.6b (v/s est. INR9.1b); margins contracted 7pp YoY to 13.7%. Adj. PAT was down 36% YoY to INR5.3b (in-line). Volumes increased 3% YoY with revenues down 7% YoY to INR24b; EBITDA declined 34% YoY to INR3.8b due to fall in domestic 14 November 2019 realization. VSF margins declined 6.4pp YoY to 15.7%. Volumes decreased 7% YoY for the quarter.

12%), led by gross margin expansion of 370bp YoY. For 1HFY20, revenue/EBITDA/PAT increased 12%/16%/6% YoY. 87% YoY to INR356m, primarily driven by spillover of sales volume from the prior quarter to 2QFY20 (as the late onset of monsoon delayed the timing of sowing). Volumes thus increased 73% YoY to 0.52m packets and realization improved 8% YoY to INR684/packet in 2QFY20. Non-cotton revenue declined 26% YoY to INR418m due to lower maize volumes (-33% YoY to INR1.2m packets) on account of reduced government orders. (i) KSCL maintained its revenue growth guidance of 15-20% for FY20. (ii) Cotton volume growth guided at 10-15% for FY21. (ii) Capex of INR300-400m planned for FY20. Despite the miss in 2QFY20, we largely maintain our earnings estimates for FY20/21, given that ~75% of revenues are derived in the first quarter of a financial year. We value the company at 16x FY21E EPS and arrive at a target price of INR607.

14 November 2019 Consolidated net sales grew 2.8% YoY to INR18.1b (v/s est. EBITDA stood flat YoY at INR3.7b (v/s est. PBT grew 5% YoY to INR3.8b (v/s est.

14 November 2019 REPCOs PAT was up 51% YoY at INR1.01b (37% beat), driven by low credit costs and a 1% tax rate (INR150m DTL reversal impact). Core PBT, however, grew 2% YoY to INR1.02b (4% beat). Disbursements were down 10% YoY at INR7b, driven by a decline in both home loan and LAP disbursements. Reported spreads were largely stable YoY at 3.1%, as the 30bp increase in cost of funds (to 8.5%) was offset by a similar rise in yields (to 11.6%). declined sequentially from 31% to 28%, leading to INR1m credit costs. The company wrote-off INR90m in the quarter (a mix of home loan and LAP). disbursements declined 7% YoY to INR13.7b, while spread was largely stable at 3%.

PAT declined 62.3% to revenue/EBITDA/PBT increased 22%/28%/8% YoY, while Adj. PAT Energy segment grew 17% YoY to INR13.4b, supported by healthy execution. Environmental segment revenue declined 11% YoY to INR1.5b with EBIT margins at 4.7% (+190bp YoY). Chemical segment revenues came in at INR1.1b (+6% YoY) with EBIT margins at 17.9% (+290bp YoY). However, on account of strong execution depicted over the past six quarters, dependency on new order wins is even higher. TMX is focused on revenue growth, but wont do it at the cost of margins or at the risk of working Margin improvement in current market condition looks difficult, more so in the project business since competition is very aggressive. Over the past few quarters, Thermax has demonstrated its strong execution capability with robust revenue growth. Over the past few quarters, Thermax has demonstrated its strong execution capability with robust revenue growth.

Vedantas (VEDL) EBITDA of INR44b (-15% QoQ) was below our estimate of INR47.2b (6% miss) due to higher cost of production (CoP) in the aluminum business and lower margins in the steel business. However, business reported a loss of INR1.1b at the EBITDA level (v/s profit of INR1.8b in 1Q) due to lower LME and higher CoP (up USD88 QoQ led by higher power cost due to lower linkage coal availability). EBITDA increased 62% QoQ to INR2.1b, led by lower CoP and higher sales, partly offset by lower realizations. had reported an EBITDA of ~INR21b. For 1HFY20, EBITDA/PBT was down 15%/36% YoY at INR96/INR36b. We cut our FY20/21 EBITDA estimate by 10/9% on the back of higher costs for the aluminum business. While the company expects its aluminum CoP to reduce through higher captive bauxite and coal linkages, coal availability issues may impact costs over the near term. Aluminum reported CoP was higher due to higher power cost.

13 November 2019 ABFRL reported strong 2QFY20 performance, backed by healthy SSSG in both Lifestyle/Pantaloons of 7%/10.4%. Overall, revenue was up 14.4% YoY to INR23b (in-line) on the back of strong revenue growth of Lifestyle brands/Pantaloons at 15%/16.3% to INR12.5b/INR9.2b. EBTDA grew 15% YoY to INR1.6b (in-line) on pre IND-AS 116 basis with flat 7.1% margin due to higher mix of low-margin Pantaloons/other businesses, which saw healthy margin improvement. PAT declined 28.7% to INR305m due to deferred tax of INR247m; adjusted PAT stood at INR551m. For 1HFY20, against OCF of INR6.8b, working capital increased by INR3.5b, with INR3.

13 November 2019 by the US (+27.3% YoY to INR28b) and Europe (+21.2% YoY to INR14b). New launches, higher sales in existing products and also sales from acquired entity provided momentum during the quarter. Growth markets grew at a subdued rate of 3.8% YoY to INR3b, while ARV/API sales were down 2.5%/1.3% YoY to INR2.4b/INR8b. YoY to 57.7% due to a favorable mix (product/geographical). However, EBITDA margin shrank 80bp YoY to 20.8% (in-line) due to higher staff cost/other expenses (+90bp/+100bp YoY). EBITDA grew 14% YoY to INR11.7b (in-line).

PAT level Power sales (70% of sales) declined 18% YoY to INR42b, while Industrial sales (30% to sales) grew strongly by 24% YoY to INR18b. PBIT margin expanded 200bp YoY to 10.3% in Power but shrank 180bp YoY to 3.0% in Industrial segment. BHEL continues struggling on account of (a) the weak ordering environment in the power sector, (b) high receivables of INR380b and (c) high employee cost at ~21% of sales. We maintain rating on the stock with a TP of INR52 (15x FY21E EPS, in line with the 10-year average P/E). PBIT margin expanded by 200bp YoY to 10.3% in Power but shrank by 180bp YoY BHEL continues struggling on account of (a) the weak ordering environment in the power sector, (b) high receivables of INR380b and (c) high employee cost at ~21% of sales. We maintain our earnings estimates and a TP of INR52 (15x FY21E EPS, in line with the 10-year average P/E).

clinker) increased 2% YoY to 1.9mt (in-line), while white cement volumes were up 13% YoY to 0.33mt in 2QFY20. For 2H, we expect sales/EBITDA/PAT to (1) JKCE commissioned a 1mt grey cement grinding unit at Nimbahera and a 2.6mt grey clinker at Mangrol on 29 of cement grinding capacity will be commissioned soon. (2) Total amount JKCEs capacity expansion will reduce its proportion of inefficient assets. The company is expanding its putty capacity by 0.2-0.3mt by Jun20 at a capex of JKCEs capacity expansion will reduce its proportion of inefficient assets. We value JKCE on an SOTP basis (FY21E EV/EBITDA) 10x for white cement, 9x for grey cement and 6x for overseas (Fujairah) to arrive at a target price of INR1,370. We value JKCE on an SOTP basis (FY21E EV/EBITDA) 10x for white cement, 9x for grey cement and 6x for overseas (Fujairah) to arrive at a target price of INR1,370.

However, like-to-like EBITDA (adjusted for Ind-AS 116) was up only 12% YoY at INR404m, with the margin down 150bp YoY to 26.5%. The 13 November 2019 company reported a loss of INR22m in 2QFY20, as against a profit of INR57m in 2QFY19 due to lower other income and higher depreciation/interest. ARR increased 4.9% YoY to INR4,133 in 2QFY20; occupancy declined 350bp YoY to 74.8%. However, on a same-hotel basis, ARR was up 2.9% YoY, while occupancy was constant at 78.2%. Despite 19% revenue growth, like-to-like EBITDA (adjusted for Ind-AS) was up only 12% YoY as the recently commenced hotels are yet to stabilize and incurred additional cost amounting to INR22m (of which INR8m is non- recurring expense relating to training of employees, while the balance is attributed to wage increase and provident fund). During the quarter, although ARR of new hotels was higher (by 15%) than the old hotels, occupancy at the former was relatively low at 58.8%, restricting overall EBITDA growth.

13 November 2019 EBITDA/scm came in line with our estimate at INR9.9 (+22% YoY) in 2QFY20, mainly due to better price realization (MAHGL took a price hike in the first week of July) and lower spot prices. Reported EBITDA was up 23% YoY at INR2.7b. Depreciation stood at INR3.9b and interest cost at INR15m on account of adoption of Ind-AS 116. PBT was up 23% YoY at INR2.6b. The company has re-measured its DTL and recorded a reduction of INR567m as deferred tax. Reported PAT was at INR2.7b versus INR1.4b in 2QFY19. , EBITDA was up 27% YoY, with EBITDA/scm at INR10.1 versus INR8.1 in 1HFY19.

13 November 2019 2QFY20 PBT increased 41% YoY to INR10.5b, driven by one-off strong GNPL recoveries, which led to income of INR2b. Excluding this one-time income, PBT grew 14% YoY to INR8.5b. PAT for the quarter was INR8.6b, driven by 18% tax rate. However, MUTH has raised USD450m senior notes from the international market as well as INR4.6b from retail NCDs in Oct19 hence, loan growth has resumed in 3QFY20. Excluding the INR2b income mentioned above, yields have improved 50bp QoQ to 21.7% v/s 20bp increase in CoF to 9.5%. While cost of funds may further increase due to the external borrowings, we expect the company to largely maintain spreads at 12%. Opex grew 8% YoY to INR3.97b. Company has guided for a pick-up in opex commensurate with loan growth in 2HFY20.

1HFY20 revenue/EBITDA grew (a) Subscription revenue should reach INR4,200-4,300m quarterly run-rate by 4QFY20, with INR1b digital revenues and 20m OTT subscribers from 11m currently. Also, content cost should remain high due to spends on OTT, the Bangla channel and increased spends to protect market share in We have cut TP to INR525 (v/s INR600 earlier) based on the cut in estimates, valuing it at 13x P/E on FY21E EPS of INR40. Broadcasting revenues were down by 53% YoY to INR80m International subscription revenues were down 15% YoY to INR410m Domestic cable revenues grew strongly by 40% to INR1.7b on account of DTH revenues grew by 4% YoY to INR2.3b Revenues from films stood at INR123m during the quarter Production expense rose by 96% YoY to INR1.7b on account of new launches in Bangla and high cost fiction program launches. Expect to make subscription revenue of INR1,000m on investment of INR1,500m Sun TV is confident of maintaining/increasing market share across languages.

sales declined 15% YoY to INR6.4b (v/s est. The sales disappointment was due to key overseas projects, such as AMAS and RAPID, getting completed, whereas Europe recorded subdued performance. EBITDA was up 23% YoY to INR615m, 13% below our est. EBITDA margin stood at 9.7% (+310bp YoY) and above our estimate of 8.5%. Margin expansion came in due to projects being in the engineering and procurement phase. PBT stood at INR363m, up 28% YoY but 14% below our est. Adj. PAT stood at INR271m, up 19% YoY and 8% below our est.

13 November 2019 2QFY20 sales at INR33.6b (in-line) were up 13.7% YoY, largely led by the Consumer Wellness business (sales at INR3.2b YoY v/s INR1.4b last year). API business also supported growth to some extent (+17.9% YoY to INR1b). India formulations grew 10.4% YoY to INR9.8b (30% of sales) for the quarter. US sales at INR14.5b (45% of sales) were up 9.7% YoY. EM sales grew 7.6% YoY to INR2.

12 November 2019 INR191b) in 2QFY20 due to lower sales volumes (-11% YoY at ~122mt, in-line). However, FSA realization was up 12% YoY on account of higher sales to the non-power sector and lower grade slippage. Cash cost (ex-OBR) increased 8% YoY to INR1,318/t, given negative operating leverage on lower volumes. The companys wage bill was up 1% YoY at INR90.7b. The beat was driven by increased FSA realization and higher-than-expected e- auction volumes. PBT declined 16% YoY to INR42.8b. Adj. PAT, however, was up 14% YoY to For 1HFY20, adj. EBITDA/PBT were up 1% YoY at INR117b/INR113b. Adj. PAT increased 19% YoY to INR81.5b on a lower tax rate. Cash flow from operations post tax though was down 46% YoY at INR49.