*

* Sectors in order of premium /

discount to historical averages

BEST PERFORMERS MoM (%)
WORST PERFORMERS MoM (%)
Highlights of September edition
Nifty down 2% on weak global cues
and geopolitical concerns.
Oil, PSU Banks, Auto and Media
outperformed the benchmark.
Telecom, Utilities, Capital Goods and
Consumer underperformed for the
third consecutive month.

Investors are advised to refer to important disclosures made at the end of this report. October 2016
Summary
Indian equities: Nifty down 2% in September, after six months of positive returns
September 2016 saw the Nifty closing at 8,611 to give a negative return of 2% MoM on weak
global cues and geopolitical concerns.
Oil (+3%), PSU Banks (+2%), Media (+2%) and Auto (+1%) were the top performers in September.
Telecom, Utilities, Capital Goods and Consumer underperformed the benchmark for the third
consecutive month.
Telecom (-8%), Utilities (-5%), Capital Goods (-4%), Cement (-4%) and Consumer (-4%) were the
top underperformers for the month of September. About the product
As the tagline suggests,
Stock performance: Breadth negative in September; 32 Nifty stocks end lower BULLS & BEARS is a
Eicher Motors (+10%), Maruti (+8%), ONGC (+8%), Aurobindo (+8%) and Bharti Infratel (+4%)
handbook on valuations in
were the top performers in September. Idea Cellular (-15%), Tech Mahindra (-10%), Ambuja
Cement (-9%), Axis Bank (-9%) and Yes Bank (-8%) were the worst performers. India. Every month, it will
cover:
Sector valuations: Oil, PSU Banks, Auto, Media outperform Valuations of Indian
Oil & Gas trades at a P/B of 1.3x (17% discount to historical average) and P/E of 10.5x (10%
markets vis--vis global
discount). OMCs (HPCL, BPCL and IOCL) continued to outperform, led by improvement in GRM
and attractive valuations. RIL was strong in September, led by news flow on Jio trial subscription markets
and rebound in GRM. Current valuation of
PSU Banks trade at 27% discount to historical average P/B. The sector has been significantly companies in various
outperforming for the last four months, driven by equity capital infusion by the government and sectors
possible revival in asset quality position. Overall, we expect stress addition in FY17 to be lower Sectors that are
than FY16; however, credit costs and core earnings are likely to remain under pressure in FY17. currently valued at
Nifty-50 highlights: Utilities underperforms for third month; trades at discount premium/discount to
Utilities now trades at 1.4x, which is at a discount of 25% to its historical P/B average of 1.9x.
their historical long-
NTPC trades at 36% discount to historical average P/B. period averages
Research & Quant Team (Deven@MotilalOswal.com)
BULLS & BEARS | October 2016 2
Contents
Indian equities: Nifty, sector performance and key valuation metrics NOTES:
Prices as on Sep 30, 2016
Global equities: Performance and valuation snapshot
BULL icon:
Valuations of Nifty companies Sectors trading
at a premium to
Valuations of midcap companies historical averages
Sector highlights: Overview and sector valuations BEAR icon:
AUTO Sectors trading
BANKS / FINANCIALS at a discount to historical
CAPITAL GOODS averages
CEMENT Valuations are on
CONSUMER a 12-month forward basis
HEALTHCARE unless otherwise
MEDIA mentioned
METALS
Sector valuations are
OIL & GAS
based on MOSL coverage
REAL ESTATE
companies
RETAIL
TECHNOLOGY Global equities data
TELECOM sourced from Bloomberg.
UTILITIES Sensex valuations based
on MOSL estimates

BULLS & BEARS | October 2016 3

Indian equities: Nifty down 2% in September after six months of positive returns
September 2016 saw the Nifty Nifty MoM change (%) negative return after six consecutive months of positive returns
closing at 8,611 to give a Nifty MoM Change (%)
negative return of 2% MoM on 8.5 9.8 10.8
weak global cues and 8.0
6.8 5.3 4.5 6.4
4.6 4.4 4.8 4.0 4.2
geopolitical concerns. 2.2 2.1 3.1 3.0 3.2
1.1
3.1
2.0 1.5
0.4 0.9 1.4 0.1 0.1 1.4 1.6 1.7
Oil (+3%), PSU Banks (+2%), 0.2 0.1 0.8
0.3 1.6
Media (+2%) and Auto (+1%) 1.5 2.41.7 2.0 3.4 2.0
5.7 4.7 3.6 4.6 3.6 4.8
were the top performers. 6.6 7.6
Telecom, Utilities, Capital

May-13

May-14

May-15

May-16
Mar-13

Mar-14

Mar-15

Mar-16
Nov-12

Jan-13

Nov-13

Jan-14

Nov-14

Jan-15

Nov-15

Jan-16
Sep-12

Jul-13

Sep-13

Jul-14

Sep-14

Jul-15

Sep-15

Jul-16

Sep-16
Goods and Consumer
underperformed the
benchmark for the third Sectoral performanceabsolute and relative to Nifty (%) Oil, PSU Banks, Media and Auto give
positive returns for the month of September
consecutive month. CY16 CY16
MoM Abs. Performance (%) Relative to Nifty MoM Performance (%)
Telecom (-8%), Utilities (-5%), Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep-
YTD YTD
Sector Chg (%) Chg (%)
Capital Goods (-4%), Cement (- 16 16 16 16 16 16 16 16 16 16 16 16 16 16 16 16 16 16
Oil -3 -11 12 2 0 4 9 5 3 19 2 -4 1 1 -4 3 5 3 5 11
4%) and Consumer (-4%) were Banks - PSU -19 -11 20 0 3 9 6 9 2 14 -15 -4 10 -2 0 8 1 7 4 6
top underperformers. Media -6 -12 7 5 5 2 11 7 2 22 -1 -4 -4 3 1 0 7 6 4 13
Auto -8 -7 14 3 5 2 7 4 1 20 -3 1 3 1 1 0 3 3 3 12
For CY16YTD, Nifty is up 8%; Midcap100 -7 -7 10 3 1 4 7 4 0 15 -2 0 0 2 -3 2 3 2 2 7
Healthcare -4 -7 0 3 -2 2 5 -1 0 -4 1 1 -11 1 -6 0 1 -3 2 -13
Cement (+38%), Metals (+32%) NBFC -8 -10 8 1 10 2 11 5 -1 15 -3 -2 -3 -1 6 0 6 3 1 7
and Media (+22%) are the top Metal -7 -2 12 6 0 7 10 6 -2 32 -2 6 1 4 -4 6 6 4 0 24
Real Estate -10 -13 17 10 5 8 5 -4 -2 12 -5 -5 6 9 1 6 1 -6 0 4
outperformers. Technology 1 -8 11 -1 2 -3 -3 -3 -2 -8 6 -1 1 -2 -2 -5 -8 -5 0 -16
Telecom (-21%), Technology (- BanksPvt
Consumer
-6 -10 14
-6 -4 8
5
0
5
5
0
5
5
3
4
1
-3
-4
12
7
-2
-1
-2
3
3
-3
3
-1
1
1
-1
4
1
-1
2
-1
-1
-2
4
-1
8%) and Healthcare (-4%) are Cement -3 -3 18 0 4 8 7 10 -4 38 2 4 7 -1 0 6 3 8 -2 30
Cap. Goods -12 -9 14 3 10 3 4 -2 -4 3 -8 -2 4 1 6 1 0 -3 -2 -5
the only losers for CY16YTD. Utilities -6 -14 12 4 1 7 4 1 -5 2 -1 -6 1 3 -3 5 0 -1 -3 -7
Telecom -20 5 9 5 -4 2 -1 -8 -8 -21 -15 13 -2 4 -8 0 -5 -10 -6 -29
Nifty Chg -5 -8 11 1 4 2 4 2 -2 8

BULLS & BEARS | October 2016 4

Indian equities: Breadth negative in September; 32 Nifty stocks end lower
Eicher (+10%), Maruti (+8%), ONGC (+8%), Aurobindo (+8%) and Bharti Infratel (+4%) were the top performers in September.
Idea (-15%), Tech Mahindra (-10%), Ambuja Cement (-9%), Axis Bank (-9%) and Yes Bank (-8%) were the worst performers.
In CY16 YTD, Hindalco (+80%), Yes Bank (+73%), Eicher (+48%), Tata Steel (+44%) and Ultratech (+39%) are the top performers.
Idea (-45%), BHEL (-20%), Tech Mahindra (-19%), Lupin (-19%) and Bharti Infratel (-15%) are the worst performers.
Best and worst Nifty performers (MoM) in September 2016 (%) - breadth turns negative
10 8 8 8
4 3 3 3 2 2 1
1 1 1 1 0 0 0

-1 -1 -1 -1 -2 -2 -2 -2 -3 -3 -3
-3 -3 -3 -4 -4 -4 -4 -4 -4 -5
-5 -5 -5 -6 -7 -7 -7
-8 -9 -9
-10
-15

Yes Bank
ONGC

Bharti Infratel
Aurobindo

HCL Tech

Dr Reddy's

SBI
Reliance Ind.

IndusInd Bk

HDFC Bank

ICICI Bank

Adani Ports

ACC

ITC

Ambuja Cem.
Bharti Airtel
BPCL

GAIL

Power Grid
UltraTech

Axis Bank
Maruti

Lupin

Bajaj Auto

L&T

Tech Mah.
Idea Cellular
BHEL
Coal India

Hindalco
TCS
Kotak Mah.Bk
Eicher Motors

Grasim Ind.

Zee Ent

Asian Paints

Nifty

Wipro

Tata Power
Sun Pharma
M&M

Bosch
BoB

Tata Steel

Tata Motors
Cipla

Infosys

HDFC

Hero Moto

HUL

NTPC
Best and worst Nifty performers (YoY) in CY16YTD (%) - 33 companies in Nifty gave positive returns till now
80 73
48 44
39 37 37 31
29 27 25 25 24 23 22 21
19 17 17 12 12 12
11 11 11 10 8 8 7 7 6 2 1 0
0 0 -1 -2 -2 -3 -6 -7
-8 -9 -11 -15 -15 -19
-19 -20
-45
Yes Bank

Ambuja Cem.

Bharti Infratel
SBI

ONGC

Dr Reddy's
ITC

Adani Ports

Aurobindo
Power Grid

IndusInd Bk

HDFC Bank
ACC

Reliance Ind.

ICICI Bank

HCL Tech
Bharti Airtel
UltraTech
BPCL

Axis Bank

GAIL

Lupin
Hindalco

Maruti

L&T
Bajaj Auto

Coal India

Tech Mah.

Idea Cellular
Kotak Mah.Bk

TCS

BHEL
Tata Power

Sun Pharma

Wipro
Eicher Motors

Asian Paints
Grasim Ind.

Bosch

M&M

Nifty
Tata Steel

Tata Motors

Zee Ent

BoB

HUL
Hero Moto

HDFC

NTPC

Infosys

Cipla
BULLS & BEARS | October 2016 5
Indian equities: Midcaps continue to outperform; trade at premium to Sensex P/E
In the last 12 months, midcaps have delivered 19% positive return, as against 7% return by the Sensex. Also, in the last five
years, midcaps have outperformed the Sensex by 48%.
Midcaps now trade at 13% premium to Sensex on a P/E basis.
Midcaps significantly outperformed large caps in last 12 months Midcaps outperformed large caps by 48% in last five years
Sensex Rebased Nifty Midcap 100 Rebased Sensex Rebased Nifty Midcap 100 Rebased
130 225
120 217
119 195
110 169
165
107
100 135
90 105
80 75

Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
Jan-12

Jan-13

Jan-14

Jan-15

Jan-16
May-12

May-13

May-14

May-15

May-16
Dec-15
Oct-15

Aug-16
Apr-16
Nov-15

Jan-16

Sep-16
Sep-15

May-16

Jun-16

Jul-16
Mar-16

12-month forward P/E (x) Midcaps trading at 13% premium to Sensex

Midcap PE (x) Sensex PE (x) Midcap Vs Sensex PE Prem/(Disc) (%)
23.0 40
Sensex Avg: 16.7x
19.5 19.1 20
Midcap Avg: 15.8x
16.9 Average: -6% 13
16.0 0

12.5 -20
9.0
-40
Jan-12

Jan-13

Jan-14

Jan-15

Jan-16
Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
May-12

May-13

May-14

May-15

May-16

Jan-12

Jan-13

Jan-14

Jan-15

Jan-16
Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
May-12

May-13

May-14

May-15

May-16
Source: MOSL, Bloomberg for Midcap valuation.

BULLS & BEARS | October 2016 6

Indian equities: Valuations at long-term averages
Valuations of Indian equities remain attractive. The Sensex now trades at a P/E of 16.9x, at its long-period average. At 2.6x,
Sensex P/B is near its 10-year average. RoE is at 15.2%, below its long-term average.
Market-cap-to-GDP ratio of 73% (FY17E GDP) is below the long-term average of 78%.
12-month forward Sensex P/E (x) 12-month forward Sensex P/B (x)
27 4.3 4.2
24.6

22 3.5

10 Year Avg: 16.9x 10 Year Avg: 2.7x

17 2.8
16.9 2.6

12 2.0
1.6
10.7
7 1.3

Sep-06

Sep-07

Sep-08

Sep-09

Sep-10

Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
Sep-06

Sep-07

Sep-08

Sep-09

Sep-10

Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
12-month forward Sensex RoE (%) Trend in Indias market-cap-to-GDP (%)

24.0 23.2
103 Average of 78% for
95
88 the period
21.5 82 83 81
71 70 73
64 66
19.0
55
10 Year Avg: 17%
16.5
15.2
15.8
14.0
Sep-06

Sep-07

Sep-08

Sep-09

Sep-10

Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16

FY17E
FY06

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16
BULLS & BEARS | October 2016 7
Global equities: India among bottom performing markets for September
In September 2016, UK (+2%), MSCI EM (+1%) and Taiwan (+1%) were the best performers among the key global markets.
Indian equities are currently trading at 18.7x FY17E earnings.
Indias RoE remains superior to most EMs, an important differentiator for valuation premium.

Sensex v/s other markets

Prem / Disc to India MoM Chg (%)
CY16 YTD Chg (%) PE (x) PB (x) RoE (%)
PE (%) UK 2
Index Mkt Cap Local CY15 / CY16 / CY15 / CY16 / CY15 / CY16 / CY15 / CY16 /
In USD MSCI EM 1
Value (USD T) Currency FY16 FY17 FY16 FY17 FY16 FY17 FY16 FY17
India 27,866 1.7 7 6 21.0 18.7 3.1 2.8 14.6 14.7 Taiwan 1
US 2,168 24.3 6 6 19.9 18.6 -5 -1 2.9 2.7 14.8 14.8 Russia 1
Indonesia 5,365 0.4 17 24 32.2 17.7 53 -5 2.7 2.5 8.3 14.2 Brazil 1
UK 6,899 3.2 11 -3 37.6 17.5 79 -7 2.0 1.8 5.3 10.3
Korea 0
Japan 16,450 5.1 -14 3 18.3 16.3 -13 -13 1.5 1.4 7.9 8.9
US 0
Brazil 58,367 0.7 35 64 -399.7 15.1 -2007 -19 1.5 1.5 -0.4 9.8
Taiwan 9,167 1.0 10 16 15.2 14.8 -27 -21 1.6 1.7 10.4 11.3 Indonesia 0
China 3,005 6.4 -15 -17 15.9 14.1 -24 -24 1.7 1.5 10.7 10.3 India -2
MSCI EM 903 8.0 14 14 17.4 13.5 -17 -28 1.6 1.5 9.1 11.0 Japan -3
Korea 2,044 1.3 4 12 14.7 11.6 -30 -38 1.0 1.0 6.7 8.5 China -3
Russia 4,478 0.5 13 32 7.3 7.1 -65 -62 0.6 0.7 8.7 9.9
Source: Bloomberg/MOSL

BULLS & BEARS | October 2016 8

Global equities: MSCI EM continues to outperform MSCI India
In the last 12 months, MSCI EM has delivered 14% positive return, as against 6% return for MSCI India. MSCI India P/E is at a
premium of 48% to MSCI EM P/E, above its historical average premium of 44%.
Indian markets are now trading at the long-term average; the UK, Brazil and US trade at significant premium.
MSCI India outperformed MSCI EM in last 12 months Sensex v/s other marketspremium/discount to LPA
PE (x) - 1 Year Forward
MSCI India Rebased MSCI EM Rebased Country Current LPA Prem/Disc (%)
122
UK 17.5 12.5 39.6
114 Brazil 15.1 12.0 26.1
112
US 18.6 15.2 22.4
106
102 Russia 7.1 5.8 21.5
Indonesia 17.7 14.6 20.7
92 MSCI EM 13.5 12.0 12.5
Korea 11.6 11.1 3.7
82 India 16.9 16.9 -0.1
Taiwan 14.8 14.9 -0.9
Dec-15
Oct-15

Aug-16
Apr-16
Nov-15

Jan-16

Sep-16
Sep-15

May-16

Jun-16

Jul-16
Mar-16

China 14.1 15.6 -9.6

Japan 16.3 21.6 -24.7

MSCI India v/s MSCI EM trailing P/E (x) MSCI India v/s MSCI EM P/E premium (%)
MSCI India PE (x) MSCI EM PE (x) MSCI India Vs EM PE Premium (%)
33.0 100

26.0 22.8 75
MSCI India Avg: 19.2x
19.0 50 48
15.4
Average of 44%
12.0 25
MSCI EM Avg: 13.5x
5.0 0
Sep-06

Sep-07

Sep-08

Sep-09

Sep-10

Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Mar-12

Mar-13

Mar-14

Mar-15

Mar-16

Sep-06

Sep-07

Sep-08

Sep-09

Sep-10

Sep-11

Sep-12

Sep-13

Sep-14

Sep-15

Sep-16
Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Mar-12

Mar-13

Mar-14

Mar-15

Mar-16
Source: Bloomberg

BULLS & BEARS | October 2016 9

Global equities: Indias share in world market cap above historical average
Indias share in the world market cap is now at 2.5%, above its long-term average of 2.4%.
In the last 12 months, world market cap has increased 9.8% (USD5.9t); Indias market cap has increased 12.6%.
Trend in India's contribution to world market cap (%) Market cap change in last 12 months (%)
India's Contribution to World Mcap (%) Mkt cap chg 12M (%) Curr Mcap (USD Tr)
3.60
3.3
2.95 Indonesia 49 0.4
Average of 2.4% 2.5
2.30
Brazil 48 0.7
1.65
1.6 Russia 27 0.5
1.00
Dec-11

Dec-14
Oct-09

Oct-12

Oct-15
Aug-10
Aug-07

Apr-16
Jan-11
Jan-08

Nov-08

Sep-13
Feb-14

Sep-16
Sep-06

May-09

May-12

May-15
Jun-08

Jul-11

Jul-14
Mar-10

Mar-13
Mar-07

China 23 6.4

Taiwan 1.0
20
Global market-cap-to-GDP (%)
Japan 15 5.1
Current mkt cap to GDP (%)
140
111 108
95 Korea 14 1.3
73
62
50 1.7
30 28 India 13

US 9 24.3
Korea

Russia
Brazil
UK

China

Indonesia
India
US

Japan

UK -4 3.2
* Based on GDP for Dec 2014

Source: Bloomberg

BULLS & BEARS | October 2016 10

Nifty: Utilities underperforms for third consecutive month; trades at discount
Utilities now trades at 1.4x, which is at a discount of 25% to its historical P/B average of 1.9x. NTPC trades at 36% discount to
historical average P/B.
In Auto, all stocks are at premium to historical averages on P/E basis. Eicher Motors is trading at 82% premium, followed by
Maruti (31%), Bajaj Auto (20%), Tata Motors (19%) and M&M (12%).
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Name Sector Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc,% Current 10 Yr Avg
Bajaj Auto Auto 17.3 14.4 20 2 -15 5.3 5.5 -4 103 102
Eicher Motors Auto 31.6 17.4 82 87 3 11.0 4.1 166 323 52
Hero MotoCorp Auto 16.8 15.5 8 -1 -8 6.3 6.9 -9 141 154
Mah & Mah Auto 16.4 14.6 12 -3 -14 3.2 3.2 -1 23 19
Maruti Suzuki Auto 22.1 16.9 31 31 0 4.8 2.8 70 83 3
Tata Motors Auto 10.9 9.2 19 -36 -46 1.7 2.4 -27 -33 -12
Axis Bank Banks - Private 15.7 13.0 20 -7 -23 2.1 2.1 1 -19 -24
HDFC Bank Banks - Private 19.8 20.9 -5 17 23 3.5 3.4 5 36 24
ICICI Bank Banks - Private 13.0 17.4 -25 -23 3 1.6 1.9 -11 -37 -32
IndusInd Bank Banks - Private 22.3 16.3 37 32 -4 3.3 2.2 50 29 -18
Kotak Mah Bank Banks - Private 25.7 22.6 14 52 33 3.5 2.9 20 34 7
Yes Bank Banks - Private 13.9 12.4 12 -18 -27 2.9 2.3 26 12 -15
Bank of Baroda Banks - PSU 9.8 7.1 39 -42 -58 1.0 1.1 -4 -61 -61
State Bank Banks - PSU 12.9 10.9 17 -24 -35 1.0 1.3 -19 -60 -53
HDFC Banks - NBFC 27.0 24.5 10 60 45 5.4 4.7 14 106 74
BHEL Capital Goods 26.5 19.8 34 57 17 1.0 3.7 -74 -63 35
Larsen & Toubro Capital Goods 20.7 23.6 -12 22 40 2.6 3.8 -32 1 41
ACC Cement 21.8 21.6 1 29 28 3.3 3.0 11 26 9
Ambuja Cements Cement 21.9 20.2 9 30 19 3.3 2.9 15 27 6
Grasim Industries Cement 11.3 9.5 19 -33 -44 1.4 1.3 9 -44 -51
Ultratech Cement Cement 28.2 18.8 50 67 11 4.2 2.9 42 60 8
Asian Paints Consumer 47.5 29.0 64 181 71 15.5 9.9 56 496 265
Hind. Unilever Consumer 40.0 30.7 30 137 81 29.6 27.7 7 1039 917
ITC Consumer 24.6 24.2 2 46 43 7.0 6.8 3 171 150

BULLS & BEARS | October 2016 11

Nifty: Healthcare trades at premium; Aurobindo and Lupin at significant premium to avg
Companies trading at a significant premium to their historical averages: Eicher Motors (+82%), Asian Paints (+64%),
Ultratech (+50%), Aurobindo (+44%), BHEL (+34%) and Zee Ent (+32%).
Companies trading at a significant discount to their averages: Bharti Airtel (-39%), Tata Steel (-34%), Reliance Inds (-28%),
Tech Mahindra (-26%), NMDC (-23%) and NTPC (-22%).
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Name Sector Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc,% Current 10 Yr Avg
Aurobindo Pharma Healthcare 17.9 12.5 44 6 -26 4.6 2.6 76 77 -4
Cipla Healthcare 22.7 24.6 -8 34 45 3.2 3.6 -10 24 32
Dr Reddy s Labs Healthcare 24.2 23.3 4 43 37 3.4 3.7 -6 33 35
Lupin Healthcare 20.5 18.9 9 22 12 4.5 4.5 -1 72 66
Sun Pharma Healthcare 22.5 25.1 -11 33 48 4.7 4.9 -6 79 81
Zee Ent. Media 31.7 24.1 32 88 42 9.1 5.3 73 249 93
Hindalco Metals 7.5 8.9 -16 -56 -47 1.2 1.7 -29 -54 -38
NMDC Metals 12.2 15.9 -23 -28 -6 1.4 4.4 -67 -45 61
Tata Steel Metals 9.5 14.4 -34 -44 -15 2.4 2.5 -2 -6 -8
BPCL Oil & Gas 10.2 11.3 -10 -40 -33 2.5 1.4 73 -5 -47
GAIL Oil & Gas 12.5 13.6 -8 -26 -20 1.4 2.0 -31 -47 -27
ONGC Oil & Gas 11.9 11.4 5 -29 -32 1.1 1.8 -38 -57 -34
Reliance Inds. Oil & Gas 9.6 13.4 -28 -43 -21 1.1 1.7 -31 -56 -39
HCL Technologies Technology 13.9 14.6 -5 -18 -13 3.3 3.3 -1 26 21
Infosys Technology 15.7 18.0 -13 -7 7 3.3 4.6 -29 25 69
TCS Technology 17.5 18.0 -3 3 6 5.3 6.2 -15 102 128
Tech Mahindra Technology 12.1 16.3 -26 -28 -4 2.1 4.1 -49 -20 49
Wipro Technology 12.9 15.4 -16 -24 -9 2.2 3.3 -33 -14 23
Bharti Airtel Telecom 17.6 29.0 -39 4 71 1.7 3.2 -47 -35 18
Bharti Infratel Telecom 28.5 25.4 12 69 50 3.7 3.0 20 41 12
Idea Cellular Telecom 37.2 29.4 27 120 74 1.0 2.5 -58 -60 -9
Coal India Utilities 16.7 14.6 14 -1 -14 5.7 5.4 7 120 97
NTPC Utilities 11.4 14.6 -22 -33 -14 1.2 1.9 -36 -52 -29
Power Grid Corp. Utilities 11.4 11.7 -3 -33 -31 1.7 1.7 4 -33 -39
Sensex 16.9 16.9 0 2.6 2.7 -4

BULLS & BEARS | October 2016 12

Midcaps: Outperform Nifty by 2% in September
In September 2016, Nifty Midcap100 was flat, as against Niftys negative return of 2%.
Top midcap performers in September 2016: Century Ply (16%), Radico Khaitan (14%) and IPCA Labs (11%).
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%) Price Chg (%)
Company Current 10 Yr Avg Prem/Disc,% Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg MoM CY16 YTD
Century Ply. 26.3 9.9 166 55 -42 7.3 2.7 168 181 0 16 47
Radico Khaitan 16.3 24.9 -35 -4 47 1.5 2.7 -43 -42 -2 14 0
Ipca Labs. 23.0 21.4 8 36 26 2.8 3.0 -5 9 10 11 -19
Birla Corpn. 10.9 9.5 14 -36 -44 1.5 1.2 23 -44 -56 8 56
Bharat Financial 17.4 15.4 13 3 -9 4.8 3.2 48 84 19 8 76
Jain Irrigation 13.5 27.4 -51 -20 62 1.4 2.7 -48 -47 -2 6 30
TTK Prestige 33.6 22.5 50 99 33 6.5 5.1 27 149 87 5 9
Federal Bank 13.5 10.0 35 -20 -41 1.4 1.1 28 -48 -61 5 28
DCB Bank 15.7 16.9 -7 -7 0 1.7 1.6 6 -34 -41 4 53
P I Inds. 25.9 10.9 137 53 -35 6.8 2.7 148 161 0 4 30
SRF 17.1 6.9 148 1 -59 3.1 1.1 169 18 -58 3 41
Guj.St.Petronet 15.2 14.0 9 -10 -17 1.9 1.9 -2 -27 -29 3 14
Monsanto India 28.9 23.9 21 71 41 9.6 5.5 76 270 101 2 9
Sobha 11.1 18.8 -41 -34 11 1.1 2.0 -47 -58 -25 2 -6
H T Media 13.6 25.3 -46 -20 50 0.7 2.2 -66 -71 -20 0 -10
Kaveri Seed 15.8 13.7 15 -6 -19 2.6 3.2 -18 1 17 0 3
Symphony 40.2 18.5 118 138 9 22.0 7.2 206 746 164 -1 -1
Voltas 25.9 21.1 23 53 24 4.3 3.9 12 67 42 -3 17
Va Tech Wabag 18.5 22.4 -17 10 32 2.6 2.6 0 -1 -5 -3 -20
India Cements 19.4 18.2 7 15 8 1.4 1.0 34 -47 -62 -4 49
Sanofi India 24.7 24.0 3 46 42 4.8 4.0 19 83 47 -5 -5
Indian Bank 7.2 5.7 26 -57 -66 0.7 0.8 -19 -75 -70 -6 83
Muthoot Finance 11.4 8.0 42 -33 -53 2.1 1.4 47 -20 -48 -7 95
Inox Leisure 26.8 27.6 -3 59 63 3.6 2.0 77 37 -26 -8 10
Coromandel Intl. 13.7 11.9 15 -19 -29 2.5 2.5 1 -2 -8 -9 29
Gateway Distriparks 16.6 15.6 6 -2 -8 2.1 1.8 16 -19 -34 -10 -22
Kitex Garments 12.1 8.7 40 -28 -49 3.8 2.7 43 46 -2 -10 -39
Tata Elxsi 19.0 17.3 10 13 2 7.5 5.3 41 190 97 -12 -38

BULLS & BEARS | October 2016 13

Sector valuations: Oil, PSU Banks, Auto outperform; Telecom and Utilities top underperformers
Oil & Gas trades at a P/B of 1.3x (17% discount to historical average) and P/E of 10.5x (10% discount). OMCs (HPCL, BPCL and
IOCL) continued to outperform, led by improvement in GRM and attractive valuations. RIL was strong in September, led by
news flow on Jio trial subscription along with rebound in GRM.
PSU Banks trade at a 27% discount to historical average P/B. The sector has been significantly outperforming for four months,
driven by equity capital infusion by GoI and possible revival in asset quality position. Overall, we expect stress addition in
FY17 to be lower than FY16; however, credit costs and core earnings are likely to remain under pressure in FY17.
Auto sector trades at 17.3x, above its historical average P/E of 14.2x. Normal monsoon boosts 2W demand. Expect rural
demand to recover in 2HFY17. Broad-based recovery in PV yet to be seen, with growth driven by new launches.
On an EV/EBITDA basis, Telecom trades at 5x (39% discount to historic average). Bharti holds strong competitive position in
the telecom market. We expect Bharti to deliver over a 2-3 year horizon. Idea remains a structural sell, given its weak
competitive position and stretched balance sheet.
Snapshot: Sector valuations
Relative to Sensex Relative to Sensex
PE (x) PB (x)
Sector P/E (%) P/B (%)
Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Auto 17.3 14.2 21.4 2 -17 3.5 3.0 15.2 35 12
Banks - Private 17.5 16.1 8.6 4 -6 2.6 2.2 18.0 -1 -20
Banks - PSU 10.9 6.4 70.4 -36 -60 0.8 1.1 -26.7 -69 -60
NBFC 14.6 12.4 17.8 -14 -27 2.6 2.3 15.1 0 -17
Capital Goods 26.8 25.9 3.4 58 49 2.8 4.2 -33.3 8 50
Cement 22.2 16.6 34.1 31 -3 3.3 2.4 39.2 28 -13
Consumer 34.0 28.1 21.3 101 68 11.0 9.5 15.4 322 259
Healthcare 22.5 21.2 6.4 33 25 4.5 4.2 7.9 74 56
Media 24.7 22.8 8.2 46 34 5.7 4.4 29.6 118 60
Metals 11.4 11.7 -3.0 -33 -32 1.1 1.6 -28.9 -56 -42
Oil & Gas 10.5 11.7 -10.5 -38 -30 1.3 1.6 -17.4 -49 -40
Real Estate 20.4 26.2 -21.9 21 57 0.9 1.5 -36.7 -64 -47
Retail 40.9 34.8 17.3 142 105 7.1 8.1 -12.5 173 202
Technology 15.5 16.7 -6.9 -8 -1 3.6 4.6 -21.3 38 67
Telecom 19.5 26.2 -25.3 16 60 1.5 2.9 -47.9 -42 6
Utilities 11.3 14.8 -23.8 -33 -11 1.4 1.9 -25.5 -46 -30

BULLS & BEARS | October 2016 14

Autos: Normal monsoon boosts 2W sales; new launches drive 4W sales
Auto sector trades at 17.3x, above its Auto Sector P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
historical average P/E of 14.2x. 31 70

24 40
Normal monsoon boosts 2W demand. 14.2 17.3
17 10 2
Expect rural demand to recover in -17
10 -20
2HFY17.
3 -50
Broad-based recovery in PV yet to be

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Sep-06
Jul-07

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Mar-09

Mar-14
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Nov-10

Nov-15
May-08

May-13
seen, with growth driven by new
launches.
Auto Sector P/B (x) 10 Yr Avg (x) 40 Relative to Sensex PB (%)
Recovery in CVs should continue, driven 5.0 35

by fleet expansion and pre-buying on 4.0 3.5

25
12
3.0
account of BS-IV from April 2017. 3.0 10

2.0 -5
Sector Performance MoM
1.0 -20
Autos +1%

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

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Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Amara Raja Batt. 27.0 12.8 111 60 -25 6.0 3.1 95 131 13
Ashok Leyland 11.9 15.5 -23 -30 -8 3.0 2.7 14 17 -1
Bajaj Auto 17.3 14.4 20 2 -15 5.3 5.5 -4 103 102
Bharat Forge 28.3 28.9 -2 68 71 5.0 3.8 32 91 38
Bosch 35.4 25.4 40 110 50 6.9 4.8 44 164 75
Eicher Motors 31.6 17.4 82 87 3 11.0 4.1 166 323 52
Escorts 15.9 12.7 25 -6 -25 1.9 0.7 151 -28 -73
Exide Inds. 19.1 19.0 0 13 12 2.9 3.3 -11 13 21
Hero Motocorp 16.8 15.5 8 -1 -8 6.3 6.9 -9 141 154
M&M 16.4 14.6 12 -3 -14 3.2 3.2 -1 23 19
Maruti Suzuki 22.1 16.9 31 31 0 4.8 2.8 70 83 3
Tata Motors 10.9 9.2 19 -36 -46 1.7 2.4 -27 -33 -12
TVS Motor Co. 25.7 14.8 74 52 -12 6.5 2.5 160 151 -8

BULLS & BEARS | October 2016 15

Private Banks: Strong retail traction; asset quality risks linger at corporate lenders
Private Banks P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Private Banks (PBs) trade at 18% 33 40
premium to LPA. This reflects strong 26 20
traction at retail private banks and largely 19 17.5 -6
4
16.1 0
unchanged pool of stress loans reported
12 -20
in 1QFY17 results.
5 -40
While private sector banks are looking to

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

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Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
disproportionately grow their retail
portfolios, we expect uncertainty on
incremental build-up in stress to remain. Private Banks P/B (x) 10 Yr Avg (x)
10
Relative to Sensex PB (%)
3.7
Credit costs are likely to remain elevated
3.0 -5
for FY17/18. 2.2 -20
-1
2.2 2.6 -20

1.5 -35
Sector Performance MoM
0.7 -50
Private Banks -3.3%

Sep-06

Sep-11

Sep-16
Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13

Jul-07

Jul-12
Mar-09

Mar-14
Jul-07

Jul-12
Mar-09

Mar-14

Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Axis Bank 15.7 13.0 20 -7 -23 2.1 2.1 1 -19 -24
DCB Bank 15.7 16.9 -7 -7 0 1.7 1.6 6 -34 -41
Federal Bank 13.5 10.0 35 -20 -41 1.4 1.1 28 -48 -61
HDFC Bank 19.8 20.9 -5 17 23 3.5 3.4 5 36 24
ICICI Bank 13.0 17.4 -25 -23 3 1.6 1.9 -11 -37 -32
IndusInd Bank 22.3 16.3 37 32 -4 3.3 2.2 50 29 -18
J & K Bank 3.9 6.3 -38 -77 -63 0.5 0.9 -49 -81 -65
Kotak Mah. Bank 25.7 22.6 14 52 33 3.5 2.9 20 34 7
South Ind.Bank 6.5 6.8 -4 -62 -60 0.7 0.9 -27 -74 -66
Yes Bank 13.9 12.4 12 -18 -27 2.9 2.3 26 12 -15

BULLS & BEARS | October 2016 16

PSU Banks: Rising optimism; outperformance continues
PSU Banks P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
PSU Banks trade at a 27% discount to 2.3 -40
historical average P/B. Sharp recovery in the
1.8 -50
stock price performance over past four -60
1.3 1.1 -60
months has been driven by equity capital 0.8 -69
infusion by GoI and possible revival in asset 0.8 -70
quality position, partly reflected in 0.3 -80
CBK/PNBs 1QFY17 performance.

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
Overall, we expect stress addition in FY17 to
be lower than FY16; however, credit costs
and core earnings are likely to remain under Sector Performance MoM
pressure in FY17. Sustained traction in large PSU Banks +2.4%
corporate deleveraging, potential one-off
benefits from trading gains and significant
reduction in net slippages are key catalysts
for re-rating.

PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Andhra Bank 2.2 5.6 -60 -87 -67 0.3 0.8 -64 -89 -72
Bank of Baroda 9.8 7.1 39 -42 -58 1.0 1.1 -4 -61 -61
Bank of India 0.0 7.2 -100 -100 -58 0.5 1.0 -54 -82 -63
Canara Bank 10.2 6.3 63 -39 -63 0.6 0.9 -30 -77 -68
IDBI Bank 9.5 8.8 8 -44 -48 0.5 0.8 -31 -79 -72
Indian Bank 7.2 5.7 26 -57 -66 0.7 0.8 -19 -75 -70
Oriental Bank 6.1 7.7 -20 -64 -55 0.3 0.7 -56 -88 -75
Punjab Natl.Bank 11.9 7.5 60 -30 -56 0.7 1.1 -33 -72 -60
St Bk of India 12.9 10.9 17 -24 -35 1.0 1.3 -19 -60 -53
Union Bank (I) 4.5 6.4 -30 -74 -62 0.4 0.9 -55 -84 -66

BULLS & BEARS | October 2016 17

NBFCs: Retail lenders continue to outperform; expect 2H recovery for rural lenders
NBFCs now trade at a P/B of 2.6x, above NBFC P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
the historical average of 2.3x. 21 0
1QFY17 results have been largely in line, 17 14.6 -12 -14
12.4 -27
with healthy AUM and profit growth. 13 -24
Urban-focused companies such as BAF 9 -36
continued to outperform due to robust 5 -48
demand uptick from urban areas. Asset

Sep-06

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Sep-16
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Mar-09

Mar-14
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Sep-16
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Nov-15
May-08

May-13
quality stress in rural-focused financiers
seems to have bottomed out, with
NBFC P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
growth expected from 2HFY17. Housing 4.0 35
finance companies continue to deliver 3.3 10 0
strong growth, but face downward 2.3
2.6 -17
2.5 -15
pressure on yields in the retail home loan
1.8 -40
segment.
1.0 -65
Sector Performance MoM
Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
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Jan-15
Nov-10

Nov-15

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Sep-11

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May-08

May-13
NBFCs -0.8%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Bajaj Finance 26.8 16.6 62 59 -2 5.7 1.7 237 120 -38
Bharat Financial 17.4 15.4 13 3 -9 4.8 3.2 48 84 19
Dewan Housing 8.2 6.7 24 -51 -61 1.4 1.1 22 -47 -59
GRUH Finance 34.7 18.7 86 105 10 10.3 5.3 95 296 94
HDFC 27.0 24.5 10 60 45 5.4 4.7 14 106 74
LIC Housing Fin. 12.9 9.1 42 -23 -46 2.5 1.7 47 -4 -38
M & M Financial 22.7 13.4 69 35 -21 2.9 2.1 42 12 -24
Muthoot Finance 11.4 8.0 42 -33 -53 2.1 1.4 47 -20 -48
Power Fin.Corpn. 4.8 7.7 -37 -71 -55 0.8 1.2 -39 -71 -54
Rural Elec.Corp. 3.8 5.9 -36 -78 -65 0.7 1.2 -44 -74 -57
Shriram Trans. 15.4 11.7 31 -9 -31 2.2 2.1 4 -17 -23

BULLS & BEARS | October 2016 18

Capital Goods: Capex activity restricted to PSUs, private capex remains elusive
Capital Goods P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Capital Goods sector now trades at a 33% 190
67
discount to historical P/B average and 140
52
above its historical P/E average of 25.8x.
37 25.9 90
49 58
Order awards declined 51% YoY (-79% 22 26.8 40
MoM) to INR84b in August 2016 due to 7 -10
the absence of large orders as well as a

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Jan-15
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Mar-14
major slump in base level order
finalization across segments. However,
ordering activity seems to be picking up 12.0
Capital Goods P/B (x) 10 Yr Avg (x)
210
Relative to Sensex PB (%)

on a TTM basis (INR2.4t, +8% YoY).

9.0 145
L&T trades at a 32% discount to its 6.0
4.2 80
long-term average on a P/B basis. 3.0 15
50 8
2.8
0.0 -50
Sector Performance MoM

Sep-16
Sep-06

Sep-11
Jul-07

Jul-12
Mar-09

Mar-14
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Nov-15
May-08

May-13

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Nov-10

Nov-15
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Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Capital Goods -4.1%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
ABB 45.9 60.7 -24 171 259 6.3 7.3 -13 143 168
Alstom T&D India 40.6 50.2 -19 140 197 5.8 5.8 0 122 112
BHEL 26.5 19.8 34 57 17 1.0 3.7 -74 -63 35
Crompton Greaves 19.1 10.5 82 13 -38 1.0 1.2 -21 -63 -55
Cummins India 29.9 21.4 40 77 27 6.9 5.6 22 164 107
Havells India 35.3 23.4 51 109 38 8.6 5.2 65 230 91
K E C Intl. 11.6 15.5 -25 -32 -9 1.7 2.4 -27 -33 -12
Larsen & Toubro 20.7 23.6 -12 22 40 2.6 3.8 -32 1 41
Siemens 65.0 46.0 41 284 172 6.5 8.2 -21 149 201
Solar Inds. 28.5 15.3 87 69 -10 5.3 3.0 73 103 12
Thermax 31.4 25.1 25 86 48 3.8 4.8 -21 47 78
Voltas 25.9 21.1 23 53 24 4.3 3.9 12 67 42

BULLS & BEARS | October 2016 19

Cement: Strong recovery in prices to aid profitability post monsoon
Cement EV/EBITDA is at a 40% premium Cement P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
39 85
to historical average. Cement demand
30 45
remained muted in 2QFY17 as demand 31
21 5 -3
slowed down in the North and West as 16.6 22.2
monsoon set in. Demand should pick up 12 -35

post monsoon. Also, recovery was seen in 3 -75

North-Central and West prices in July

Jan-10

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Nov-15
Sep-06

Sep-11

Sep-16
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May-13

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Sep-16
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May-13
Jul-07

Jul-12
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Mar-14

Jul-07

Jul-12
Mar-09

Mar-14
2016 while South prices remained stable.
Cement P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
Cement EV/EBDITA (x) 10 Yr Avg (x) 5.5 50
18.0 28
4.3 25
14.0 11.6 3.3
10.0 3.0 2.4 0 -13
8.3
6.0 1.8 -25

2.0 0.5 -50

Jan-10

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Nov-10

Nov-15
Sep-06

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Sep-16
May-08

May-13

Jan-10

Jan-15
Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

Jul-07

Jul-12
Mar-09

Mar-14
Sep-06
Sep-07
Sep-08
Sep-09
Sep-10
Sep-11
Sep-12
Sep-13
Sep-14
Sep-15
Sep-16

Sector Performance MoM

Cement -4.1%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
ACC 21.8 21.6 1 29 28 3.3 3.0 11 26 9
Ambuja Cem. 21.9 20.2 9 30 19 3.3 2.9 15 27 6
Birla Corpn. 10.9 9.5 14 -36 -44 1.5 1.2 23 -44 -56
Grasim Inds 11.3 9.5 19 -33 -44 1.4 1.3 9 -44 -51
India Cements 19.4 18.2 7 15 8 1.4 1.0 34 -47 -62
Shree Cement 26.1 20.4 28 54 20 6.4 3.8 71 147 38
UltraTech Cem. 28.2 18.8 50 67 11 4.2 2.9 42 60 8

BULLS & BEARS | October 2016 20

Consumer: Trades at P/E of 36.1x, 29% premium to long-term average
Consumer P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Consumer sector P/E remains above its historical 43 146

average (21% premium). 36 107

28.1 34.0 68 101
29 68
Consumer sectors volume growth trajectory was 22 29
unchanged QoQ. Good monsoon and 7th Pay 15 -10
Commission are expected to bring higher

Jan-10

Jan-15
Nov-10

Nov-15
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Sep-16
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May-13

Jan-10

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Jul-07

Jul-12
Mar-09

Mar-14
disposable income in the hands of consumers,
thus likely boosting demand in 2HFY17. Consumer P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
15.0 480
12.5 380 322
Raw material scenario remains benign, inching 10.0 9.5 11.0 280
259

up QoQ. 7.5 180

Sector Performance MoM 5.0 80

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

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Nov-10

Nov-15
May-08

May-13

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Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Consumer -4.1%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Asian Paints 47.5 29.0 64 181 71 15.5 9.9 56 496 265
Britannia Inds. 38.0 25.4 50 125 50 15.2 10.3 47 486 280
Colgate-Palm. 36.8 29.2 26 118 72 22.3 25.9 -14 760 851
Dabur India 31.4 27.3 15 86 61 8.7 9.3 -7 234 242
Emami 38.0 23.9 59 125 41 12.3 8.6 43 374 215
GlaxoSmith C H L 31.9 23.6 35 89 40 7.9 6.9 15 202 152
Godrej Consumer 34.4 25.9 33 104 53 7.9 7.8 1 204 186
Hind. Unilever 40.0 30.7 30 137 81 29.6 27.7 7 1039 917
ITC 24.6 24.2 2 46 43 7.0 6.8 3 171 150
Jyothy Lab. 41.3 32.3 28 144 91 6.6 3.1 110 154 15
Marico 38.4 25.2 53 127 49 13.7 8.1 68 428 199
Nestle India 47.7 36.0 32 182 113 17.3 23.1 -25 565 750
P & G Hygiene 45.4 31.9 42 168 88 12.2 9.2 32 371 240
Page Industries 47.7 28.4 68 182 68 22.3 13.5 65 757 395
Pidilite Inds. 34.3 24.9 38 103 47 9.1 6.3 45 249 130
Radico Khaitan 16.3 24.9 -35 -4 47 1.5 2.7 -43 -42 -2
United Spirits 52.4 60.2 -13 210 256 12.9 11.3 14 395 314

BULLS & BEARS | October 2016 21

Healthcare: USFDA inspectional observations offset recovery in domestic market
Healthcare P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Healthcare sector trades at a P/E of 22.5x at 36 90
a 6% premium to historical average. 30 60
USFDA inspectional observations at Alkems 24 21.2 22.5 30
25 33

Daman facility and Ciplas Goa facility 18 0

adversely impacted stock prices 12 -30
US drug approvals for ARBP, GNP provided

Sep-16
Sep-06

Sep-11
Jul-07

Jul-12
Mar-09

Mar-14

Jan-10

Jan-15
Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
support to stock prices.
Recovery in domestic market growth in Healthcare P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
July-August 2016 also provided support to 7.0 140
stock prices. 5.8 100
74
Long-term outlook for the sector remains 4.5
4.2 4.5
60
56

strong due to differentiated US pipeline and 3.3 20

high growth in the domestic market. 2.0 -20
Sector Performance MoM

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
Jan-10

Jan-15
Nov-10

Nov-15
Sep-11

Sep-16
Sep-06

May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Healthcare +0.1%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Aurobindo Pharma 17.9 12.5 44 6 -26 4.6 2.6 76 77 -4
Biocon 32.9 18.4 78 95 9 4.2 2.4 74 60 -12
Cadila Health. 21.6 18.4 17 28 9 5.4 4.7 15 108 73
Cipla 22.7 24.6 -8 34 45 3.2 3.6 -10 24 32
Divi's Lab. 25.3 20.1 26 50 19 6.6 5.4 22 154 98
Dr Reddy's Labs 24.2 23.3 4 43 37 3.4 3.7 -6 33 35
Glaxosmit Pharma 42.4 35.8 18 151 112 17.0 10.3 64 552 280
Glenmark Pharma. 19.9 31.1 -36 17 84 4.0 4.6 -14 53 70
Granules India 14.0 12.4 13 -17 -27 2.7 1.4 94 3 -49
Ipca Labs. 23.0 21.4 8 36 26 2.8 3.0 -5 9 10
Lupin 20.5 18.9 9 22 12 4.5 4.5 -1 72 66
Sanofi India 24.7 24.0 3 46 42 4.8 4.0 19 83 47
Sun Pharma.Inds. 22.5 25.1 -11 33 48 4.7 4.9 -6 79 81
Torrent Pharma. 21.4 13.4 59 26 -21 6.0 3.8 57 130 40

BULLS & BEARS | October 2016 22

Media: Trading near historical average P/E; broadcasters clear winners
Media P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
The Media sector trades at one-year 47 150
forward P/E of 24.7x at an 8% 37 100
premium to historical average of 22.8x. 22.8 34 46
27 24.7 50
Digitization and ad growth revival 17 0
remain the key themes in the sector. 7 -50
Broadcasters superior bargaining

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
power holds them in good stead to
capture the upside.
Media P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
Subscriber-level ARPU improvement in 7.2 130 118
5.7
Phase I/II markets and an uptick in 5.7 90
4.4 60
Phase III digitization are key growth 4.2 50
triggers on the subscription front. 2.7 10
1.2 -30
Sector Performance MoM

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Media +2.2%

PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
H T Media 13.6 25.3 -46 -20 50 0.7 2.2 -66 -71 -20
Jagran Prakashan 15.1 18.3 -18 -11 8 3.0 3.8 -21 17 41
PVR 32.9 36.3 -9 94 114 5.1 2.6 94 96 -4
Sun TV Network 17.8 22.0 -19 5 30 4.8 5.4 -11 86 99
Zee Entertainmen 31.7 24.1 32 88 42 9.1 5.3 73 249 93

BULLS & BEARS | October 2016 23

Metals: Indian steel prices (longs) were stronger
Metals trade at a P/B of 1.1x, a 29% Metals P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
28 45
discount to historical average. EV/EBITDA
21 15
is at 6.8x, a 5% discount to historical 11.7
average. Long product (TMT Mumbai) 14 11.4 -15 -32
-33
prices were up MoM. 7 -45
0 -75
Metal Sector EV/EBDITA (x)

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
13.0
10.5
8.0 7.2 6.8 Metals P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
5.0 20
5.5
3.8 -5
3.0
2.5 -30
Sep-06
Sep-07
Sep-08
Sep-09
Sep-10
Sep-11
Sep-12
Sep-13
Sep-14
Sep-15
Sep-16 1.6 -42
1.1 -56
1.3 -55
0.0 -80
Sector Performance MoM

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12

Jan-10

Jan-15
Nov-15
Mar-09

Mar-14

Nov-10

Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Metals -1.8%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Hind.Zinc 12.3 8.1 51 -27 -52 2.2 1.8 22 -16 -34
Hindalco Inds. 7.5 8.9 -16 -56 -47 1.2 1.7 -29 -54 -38
Jindal Steel 13.6 -20 0.4 2.5 -83 -83 -7
JSW Steel 9.1 12.6 -28 -46 -25 1.7 1.3 34 -35 -54
Natl. Aluminium 9.6 17.4 -45 -43 3 0.8 1.5 -46 -69 -45
NMDC 12.2 15.9 -23 -28 -6 1.4 4.4 -67 -45 61
SAIL 12.7 -25 0.5 1.4 -64 -81 -49
Tata Steel 9.5 14.4 -34 -44 -15 2.4 2.5 -2 -6 -8
Vedanta 9.3 8.4 11 -45 -50 1.1 2.3 -53 -59 -16

BULLS & BEARS | October 2016 24

Oil & Gas: Trades at P/E of 10.1x, GRMs rebound
Oil & Gas trades at a P/B of 1.3x (17% 22
Oil & Gas P/E (x) 10 Yr Avg (x)
-10
Relative to Sensex PE (%)
discount to historical average) and P/E of
18 -20
10.5x (10% discount).
14 11.7 -30
-30 -38
OMCs (HPCL, BPCL and IOCL) continued 10
10.5
-40
to outperform, led by improvement in 6 -50
GRM and attractive valuations.

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
RIL was strong in September, led by news
flow on Jio trial subscription along with Oil & Gas P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
rebound in GRM. 3.0 -15

While RIL may remain active, led by Jio 2.5 -27

-40
news flow, OMCs are still attractive in 2.0 -39
1.6 -49
the backdrop of higher and predictable 1.5 1.3 -51
earnings. 1.0 -63
Sector Performance MoM
Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Sep-16
Sep-06

Sep-11
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
Oil & Gas +2.8%
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
BPCL 10.2 11.3 -10 -40 -33 2.5 1.4 73 -5 -47
CPCL 23.6 9.8 141 40 -42 2.1 1.0 107 -18 -62
Cairn India 19.2 14.3 34 13 -16 0.7 1.1 -31 -71 -60
GAIL (India) 12.5 13.6 -8 -26 -20 1.4 2.0 -31 -47 -27
Guj.St.Petronet 15.2 14.0 9 -10 -17 1.9 1.9 -2 -27 -29
HPCL 9.1 9.1 0 -46 -46 1.9 0.9 101 -28 -66
IOCL 7.7 10.2 -25 -55 -40 1.5 1.2 28 -42 -57
Indraprastha Gas 17.4 11.7 49 3 -31 3.5 2.7 28 34 0
MRPL 6.4 10.8 -41 -62 -36 1.7 1.8 -10 -36 -32
ONGC 11.9 11.4 5 -29 -32 1.1 1.8 -38 -57 -34
Petronet LNG 16.7 11.6 45 -1 -32 3.2 2.4 36 23 -13
Reliance Inds. 9.6 13.4 -28 -43 -21 1.1 1.7 -31 -56 -39

BULLS & BEARS | October 2016 25

Real Estate: Slowdown continues; pre-sales muted
Real Estate P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Real Estate trades at a P/B of 0.9x, at a 52 200
37% discount to historical average P/B. 39 125
57
Pre-sales activity remains muted, barring 26
26.2
50
a few instances of success. Prices are 13 20.4 -25
21

expected to undergo time correction. 0 -100

Appetite for rightly-priced products at

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
the right place exists. Commercial
demand is rising. Improvement is visible
in some cities, with successful launches 8.0
Real Estate P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
100
of GPL (Thane), and MLIFE (Pune),
6.0 50
Prestige (Bangalore).
4.0 0
-47
2.0 1.5
-50 -64
0.9
Sector Performance MoM 0.0 -100
Real Estate -1.9%

Jan-10

Jan-15
Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13

Jan-10

Jan-15
Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

Jul-07

Jul-12
Mar-09

Mar-14
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Brigade Enterpr. 12.3 13.4 -8 -27 -21 1.2 1.0 19 -54 -63
DLF 34.3 38.8 -12 103 130 0.9 1.9 -52 -65 -30
Indbull.RealEst. 9.9 16.5 -40 -41 -2 0.5 0.7 -27 -80 -74
Mahindra Life. 12.7 18.4 -31 -25 9 1.0 1.5 -36 -62 -43
Sobha 11.1 18.8 -41 -34 11 1.1 2.0 -47 -58 -25
Phoenix Mills 17.8 53.0 -66 6 213 2.6 2.3 16 1 -17

BULLS & BEARS | October 2016 26

Retail: Trades above historical average; Titan at premium of 36% to historical avg
Retail P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
The Retail sector now trades at a P/E of 68 250
40.9x, at a 17% premium to historical 51 175
average. 34.8
40.9
105
142
34 100
Sharp incremental slowdown was seen in 17 25
Jubilant Foodworks (YoY decline in SSSG). 0 -50
Tanishqs SSS was impacted by

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
clampdown on black money and absence
of activation. Recovery will take time and
the stocks under coverage are 14.0
Retail P/B (x) 10 Yr Avg (x)
400
Relative to Sensex PB (%)

fairly-valued, in our view.

11.0 310
8.1
Titan trades at a 36% premium to its 8.0 220 202

historical average P/E. 5.0

7.1
130 173

2.0 40

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Jubilant Food 49.8 74.1 -33 195 338 7.5 13.1 -43 190 383
Shoppers Stop 36.4 57.0 -36 115 237 3.3 4.6 -28 29 71
Titan Inds. 40.0 29.5 36 137 74 7.8 9.1 -14 199 233

BULLS & BEARS | October 2016 27

Technology: Weakness in a seasonally strong period
Technology P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Technology sector trades at a P/E of 27 60
15.5x, below its historical average. Stocks 22 35
have underperformed for the fourth 16.7
17 10
consecutive month. 15.5
-1
12 -15 -8
Macroeconomic uncertainties, led by 7 -40
Brexit, and a prolonged low interest rate

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
scenario have been leading to decision
making delays resulting in subdued
revenue growth, and tepid outlook. Technology P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
10.0 200
Growth in the seasonally strong 1H has
8.0 150
hence softened, narrowing the likelihood
6.0 100
of double-digit growth for FY17. 4.6 67
4.0 50
3.6
All large-cap IT stocks are trading at a 2.0 0
38

discount to their 10-year historical

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
average P/E.
Sector Performance MoM
Technology -2.0%

PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Cyient 12.5 11.9 5 -26 -30 2.1 1.9 12 -19 -31
HCL Technologies 13.9 14.6 -5 -18 -13 3.3 3.3 -1 26 21
Infosys 15.7 18.0 -13 -7 7 3.3 4.6 -29 25 69
MphasiS 12.9 11.9 9 -23 -30 1.7 2.3 -25 -34 -15
TCS 17.5 18.0 -3 3 6 5.3 6.2 -15 102 128
Tech Mahindra 12.1 16.3 -26 -28 -4 2.1 4.1 -49 -20 49
Wipro 12.9 15.4 -16 -24 -9 2.2 3.3 -33 -14 23
Zensar Tech. 11.3 6.0 87 -33 -64 2.4 1.5 64 -7 -46

BULLS & BEARS | October 2016 28

Telecom: Low EV/EBITDA on uncertain competitive landscape
Telecom P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
On an EV/EBITDA basis, the Telecom 58 350
sector trades at 5x (39% discount to 46 250
historical average).
34 150
26.2
Bharti holds strong competitive position 60
22 50
in the telecom market. We expect Bharti 19.5
16
10 -50
to deliver over a 2-3 year horizon.

Jan-10

Jan-15
Nov-10

Nov-15
Sep-06

Sep-11

Sep-16
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14

Jan-10

Jan-15
Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Idea remains a structural sell, given its
weak competitive position and
stretched balance sheet. 8.5
Telecom P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
145
Telecom Sector EV/EBDITA (x)
16.0 6.5 95
13.0 4.5 45
2.9 6
10.0 8.2 2.5 1.5
-5
7.0 0.5 -42
5.0 -55
Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
4.0

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
Sep-06
Sep-07
Sep-08
Sep-09
Sep-10
Sep-11
Sep-12
Sep-13
Sep-14
Sep-15
Sep-16

Sector Performance MoM

Telecom -7.9%

PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Bharti Airtel 17.6 29.0 -39 4 71 1.7 3.2 -47 -35 18
Idea Cellular 37.2 29.4 27 120 74 1.0 2.5 -58 -60 -9

BULLS & BEARS | October 2016 29

Utilities: Underperforms for third consecutive month; trades at discount
Utilities P/E (x) 10 Yr Avg (x) Relative to Sensex PE (%)
Utilities trade at a P/B of 1.4x, at a 25% 32 70
discount to historical average. 26 35
Coal India and Power Grid trade near 20 0 -11
14.8
historical average P/B, while NTPC and 14 -35
-33
JSW Energy trade at a huge discount to 8 11.3
-70
historical average P/B.

Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Jan-10

Jan-15
Nov-10

Nov-15
Sep-16
Sep-06

Sep-11
May-08

May-13
Jul-07

Jul-12
Mar-09

Mar-14
Short-term power prices averaged less
than INR2.3/kWh, with the summer peak Utilities P/B (x) 10 Yr Avg (x) Relative to Sensex PB (%)
season receding. 4.0 55
3.2 25

Sector Performance MoM 2.4 1.9 -5

-30
1.6 1.4
-35 -46
Utilities -5.2%
0.8 -65
Sep-06

Sep-11

Sep-16
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13

Sep-16
Sep-06

Sep-11
Jul-07

Jul-12
Mar-09

Mar-14
Jan-10

Jan-15
Nov-10

Nov-15
May-08

May-13
PE (x) Relative to Sensex P/E (%) PB (x) Relative to Sensex P/B (%)
Company Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg Current 10 Yr Avg Prem/Disc (%) Current 10 Yr Avg
Coal India 16.7 14.6 14 -1 -14 5.7 5.4 7 120 97
JSW Energy 9.8 14.1 -31 -42 -16 1.2 1.8 -32 -53 -33
NTPC 11.4 14.6 -22 -33 -14 1.2 1.9 -36 -52 -29
Power Grid Corpn 11.4 11.7 -3 -33 -31 1.7 1.7 4 -33 -39

BULLS & BEARS | October 2016 30

 Motilal Oswal Securities Limited
MEMBER OF BSE AND NSE
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