Sterlite Industries: TP: INR193 Buy: Motilal Oswal

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Investment in group companies remains return dilutive
Maintain Buy
 Metal volumes grow but ASR remains at just 7% over FY07-11.
 Zinc business to improve RoIC but power and aluminum businesses lose
money.
 RoIC will improve from 26% in FY11 to 31% in FY13 and RoCE will improve
in FY12 due to better performance by the zinc business.
 Valuations attractive, maintain Buy.
Metal volumes grow but STLT's ASR remains at 7% over FY07-11
Sterlite Industries (STLT) delivered strong volume growth across metals over FY07-
11 but its ASR (annualized stock returns) was just 7% . Its attributable zinc, lead and
silver production volumes (under HZ and Zinc International) posted CAGR of 24%,
13% and 31% to 535kt, 48kt and 95 tons respectively. STLT posted saleable power
CAGR of 81% to 4.7b kWh over FY07-11. With ongoing capacity expansion at HZ
and Sterlite Energy (STLE), we expect metal and power generation to grow strongly
over FY11-13. Although aluminum production was stagnant due to moth-balling of an
uneconomical smelter at Balco, STLT expanded Balco's capacity by 325ktpa over the
past few years. However this smelter expansion (along with Vedanta Aluminium's
new 1.25mtpa smelter) has been on hold since October 2010 due to non-allocation of
bauxite for VAL's refinery and subsequent denial of forest clearance from the Ministry
of Environment and Forests (MoEF). Besides, uncertainties and controversies
surrounding a ~USD8b Vedanta Aluminum project affected the stock performance
over the past few quarters. Delays in commissioning its power project and unavailability
of linkage coal at STLE also affected ASR.
Attributable EBITDA declined from INR65b in FY07 to INR55b in FY11 due to higher
stripping and coal costs at HZ, lower LME zinc prices (over USD3500/t in FY07) and
lower contribution from Balco. Return ratios also declined due to delays in project
execution and dilution of equity. Over FY07-11, STLT generated USD6.2b of cash
flow from operations and invested a similar amount in capex. Out of USD6.2 capex,
HZ invested ~USD1.7b on expanding zinc and lead capacities, Balco's capex was
~USD1.2b and USD1.1b was invested in STLE. Despite sufficient cash inflow, STLT
raised USD3.4b of equity over FY07-11, which also impacted return ratios.

Zinc business to improve RoIC but power, aluminum businesses lose money
STLT's RoIC is expected to improve over FY11-13 due to superior performance by the
zinc business, but the power and aluminum businesses are losing money due to unavailability
of linkage coal and captive bauxite. RoIC will improve from 26% in FY11 to 31% in FY13.
RoCE will also improve in FY12 due to a rising IC/CE ratio, but we expect it to see some
deterioration in FY13.
Other positive triggers for the stock are the timely opening of Balco's captive coal mine
and commissioning of a 1,200MW power plant. We expect the coal mine to become
operational by December 2011 and STLT plans to commission the first unit of its 1,200MW
project in 4QFY12, which will lead to a quantum jump in profits.

As per CEA's monthly power generation report for August, STLE commissioned the third
unit of 600MW at Jharsuguda. Although overall utilization declined MoM at STLE, we
expect STLT to find a long term, feasible solution to source coal for the project. Coal India
recently cut its linkage from 55% to a mere 25% for STLE's project, which has led us to
cut our STLE FY12 PAT estimate to INR1.8b from INR5.5b, earlier.


Valuations
STLT is expected to post earnings CAGR of 16% over FY11-13, driven by strong operating
performance of the zinc business. RoIC and RoCE will improve. Over the next two years
STLT will generate ~USD4.3b operating cash flow and invest ~USD1.6b in capex. Net
debt will increase to USD3.2b in FY13.

STLT traded at a premium to its NAV (taking into account replacement costs for fixed
assets) until FY10. However, since then it has started trading at a discount to NAV due to
delays in commissioning of STLE's power units, inability to secure captive bauxite and
coal linkages. At a CMP of INR116, the stock trades at a 20% discount to NAV. Earnings
from the aluminum and power business are vulnerable to shortage of coal and unavailability
of bauxite. Investor concern over capital allocation to high risk projects of group companies
has de-rated the stock. It trades at attractive valuations of 3.4x EBITDA and 0.8x BV.
We maintain Buy with a target price of INR193 based on a SOTP analysis.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Nalco : TP: INR77 Neutral :Motilal Oswal

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Alumina refinery expansion to drive RoCE
Upgrade to Neutral
 Rise in cost of production depresses return ratios.
 Over FY07-11 Nalco delivered ASR of only 3% despite average RoIC of 43%.
Consistently declining RoIC and IC/CE ratio dragged down RoCE.
 Nalco's alumina refinery expansion will drive RoIC and RoCE.
 We upgrade the stock to Neutral.
Rise in cost of production depresses return ratios
Over FY07-11, Nalco's cost of production (CoP) increased almost 75% to ~USD2,100/
ton due to rising operating costs. There has been huge cost inflation due to unavailability
of cheaper linkage coal from Coal India, rising maintenance costs due to aging smelters,
faster labor cost inflation than productivity improvement and rising commodity prices.
Nalco gets 70-80% of its allotted coal from Coal India and it procures the rest either
from e-auctions or imports, which raises costs. Per ton cost of coal used for its captive
power plant increased from USD13 in FY07 to USD30 in FY11. Employee cost per
ton of aluminum produced has doubled from USD242 in FY07 to USD484 in FY11.
Consequently, return ratios declined over FY07-11. RoIC peaked in FY07 at 82% and
fell sharply to 23% in FY11. RoE declined from 31% to 10% in FY11. RoCE declined
from 49% in FY07 to 13% in FY11 due to higher operating costs and lower LME
(aluminum declined from ~USD2,600 to USD2,200 in FY11).


Benefits of phase II expansion will drive earnings growth
Nalco invested ~USD1.1b over FY07-11 to increase smelter capacity from 345ktpa
to 460ktpa, boost captive power capacity from 960MW to 1,200MW and increase
alumina capacity from 1.6mtpa to 2.1mtpa under its phase II expansion. The balance
sheet has remained debt free with a cash surplus of USD1.1b. Commissioning of an
alumina refinery is behind schedule but Nalco expects to complete it in FY12. As
production of alumina increases, sales volumes will grow, driving revenue growth


Rising UnIC/CWIP
Nalco's UnIC/CWIP will increase from 35% in FY11 to 54% in FY13 due to an increasing
cash component and lower capex in the core business. Although Nalco is working on
several expansion projects in Indonesia and Orissa, on nuclear power and titanium, there
is little visibility of any of them being completed. Nalco's intention to get into unrelated
projects (even though through a JV partner) is worrisome.
RoIC, RoCE improve; Valuations attractive; upgrade to Neutral
Nalco will post earnings CAGR of 17% over FY11-13 due to strong growth in alumina
volumes and stronger alumina prices. Over the next two years, Nalco will generate USD1b
cash flow from operations and capex will be a mere USD100m. However valuations have
become attractive after the recent correction in stock price. Nalco will also benefit from a
depreciating rupee as it exports excess alumina and the alumina refinery expansion will
drive RoIC and RoCE. At CMP of INR 62, the stock trades at a 56% discount to NAV
and EV of 3.4x FY13E EBITDA. Risk remains from coal supply disruptions from Mahanadi
coalfield. We upgrade the stock to Neutral with a target price of INR77 based on 5x
FY13E EV/EBITDA.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Hindustan Zinc: TP: INR183 Buy: Motilal Oswal

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Silver boosts RoIC
Re-investment strategy unclear
 Strong silver volume growth to boost HZ's RoIC.
 RoCE will keep declining due to a rise in un-invested capital in total capital
employed.
 Higher dividend payout can re-rate stock. Maintain Buy.
Strong volume growth of silver to boost RoIC
We expect Hindustan Zinc (HZ) to post volume CAGR of 6% to 808k tons over
FY11-13 due to planned capacity addition from 212ktpa (since Sterlite's acquisition in
April 2002) to 964ktpa in FY11. It commissioned a 100ktpa lead smelter in Dariba in
2QFY12, which will drive lead and silver production volumes. Production at the silverrich
Sindesur Kurd (SK) mine is being ramped up to gain maximum potential when
metal prices are touching peaks. We expect the mine to produce up to 1.5mt in FY12
and up to 2mt in FY13.
We expect silver to post volume CAGR of 77% to 460 tons over FY11-13 and lead to
post volume CAGR of 56% to 140k tons. Thus lead and silver will enhance their share
in total revenue from the existing 12% to almost 30%.
Invested capital share to decline, put pressure on RoCE
With increasing production of silver, RoIC is expected to jump from 74% in FY11 to
97% in FY13. Once the ongoing expansion is complete, invested capital will decline
and other income will increase, putting pressure on RoCE and RoE over FY11-13.
After the completion of an ambitious capacity addition over the past eight years, the
management is contemplating efficient resource allocation. Over FY11-13, HZ will
generate USD3.4b operating cash flow, which will have to be invested in high margin
core businesses to generate higher returns. Alternatively, the management could make
a higher dividend payout.


Valuations
HZ will post earnings CAGR of 13% over FY11-13 due to higher metal production. HZ
has a lean cost structure (CoP including royalties of ~USD1,000/ton) and strong volume
growth in lead and silver will drive earnings growth. A rising share of silver in EBITDA
will drive RoIC but RoCE will keep declining due to a falling share of invested capital in
the core business. A higher dividend payout can re-rate the stock. Maintain Buy.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Hindalco: TP: INR226 Buy : Motilal Oswal

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Projects delayed but business strong
Valuations attractive post underperformance
 HNDL's domestic projects delayed but core business is strong.
 Net debt to increase due to ongoing capex in green-field projects.
 Novelis on track to achieve targeted EBITDA of USD1.15b-1.2b.
 Projects still attractive and key to earnings growth. Maintain Buy.
Domestic projects delayed but business strong
Over the past decade, Hindalco's (HNDL) aluminum production capacity increased
at a CAGR of 8% to 506ktpa due to brown-field expansion at Renukoot in FY04 and
the merger of Indal in FY05. Although HNDL envisaged three green-field smelter
projects in Orissa, Jharkhand and Madha Pradesh and signed MoUs with the respective
state governments during 2005-06. The actual progress on these high margin projects
remained slow due to infrastructure bottlenecks, uncertain regulatory environment
and local law and order situation. Meanwhile, HNDL acquired flat rolled product
(FRP) producer Novelis, which strengthened its downstream business.
After HNDL turned around the Novelis business in FY10, the management expedited
the progress of the projects. Although the projects have seen time and cost overruns
over the past few years, they remain attractive as cost of production of marginal
producers increased due to rising coal and energy costs. With captive bauxite, the CoP
of alumina at Utkal is now likely to be USD140-150/ton (25% higher than earlier
estimated).
Although we do not expect production ramp-up in FY13, we expect alumina and
aluminum volumes to jump 60-65% YoY to 2.5mt and 962k tons respectively in FY14,
driving earnings growth.


Novelis on track to achieve targeted EBITDA of USD1.15b-1.2b
Novelis is on track to achieve targeted EBITDA of USD1.15b-1.2b through volume growth
and an improved product mix. As FRP demand remains strong, Novelis will invest USD1.5b
over 2-3 years to increase capacity by 33% to 4mtpa. Novelis identified key growth areas.
e.g. (1) It will expand can sheet capacity by investing USD300m in Pinda, Brazil to cater
to strong growth in South America; (2) The company announced a USD200m investment
in its North America units to increase automobile sheet capacity to cater to demand.
Novelis expects stable demand for cans (50-55% of revenue) and is experiencing positive
traction in demand from the automobile segment (15% of revenue).



Valuations attractive; Buy with target price of INR226
HDNL's earnings will post CAGR of 4.7% over FY11-13 as the benefit of ongoing expansion
in India and Novelis will kick-in only in FY14. Both RoE and RoCE will decline as production
will not ramp up until FY13 and the start of captive coal for Mahan may also get delayed.
After acquisition of Novelis, the stock began to trade at a discount to NAV. At CMP of
INR130, Hindalco now trades at a deep discount of 42% to NAV (taking into account
replacement costs for fixed assets).
Over FY07-11 HNDL was the worst performing stock, delivering zero returns. Although
Hindalco generated operating cash flow of INR243b and it used INR194b as organic
capex. A large part of this capex (INR131b) was in CWIP at the end of FY11. The IC/CE
ratio is declining after peaking in FY09 at 73%. This is dragging down RoCE.
HNDL raised INR122b through rights and QIP issues, of which INR117b (net return of
capital) was used mainly to acquire Novelis. Going forward, we expect RoIC to improve
slightly by 40bp to 16.2% in FY13 due to improved margins in the Indian business, but
RoCE will decline marginally by 30bp due to deteriorating IC/CE ratio, primarily due to
project delays.
Considering the improved pricing power for FRP producers in the industry and ongoing
investments by key players (Alcoa's recent announcement of USD300m capex in the US)
we believe Novelis is better placed to withstand economic uncertainty. The stock trades at
attractive valuations of 5.1x EV/EBITDA, 1.1x P/BV FY13E and a 42% discount to
NAV. We value the stock at INR226 based on 7x FY13E EBITDA. Maintain Buy.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Sesa Goa: TP: INR288 Neutral : Motilal Oswal

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Re-investment drags RoCE
Volumes at risk; Downgrade to Neutral
 Superior RoIC over FY07-11 but business uncertainties suppressed ASR.
 We expect FY12 volumes to shrink due to a mining ban in Karnataka.
 IC/CE ratio fell from 48% in FY07 to 25% in FY11 as SESA did not invest cash
flow in its core business but bought stake in Cairn India. We expect the
ratio to fall further.
 We downgrade the stock to Neutral as risks rise to volume growth in the
merchant mining business.
Best RoIC over FY07-11 but uncertainty hits stock performance
Sesa Goa (SESA) generated INR61b of operating cash flow over FY07-11 and invested
only INR32b. Its RoIC was the best in the metals sector, registering average of 174%
over FY07-11, much above the sector average of 61%. However, annualized stock
returns (ASR) were only 31% with dividend payout of 11.8%. Although average
realization of iron ore increased at a CAGR of 26% to USD93b over FY07-11, ASR
was impacted due to rising uncertainty about the profitability of the merchant mining
business in India and capital employment in the non-core business (acquisition of 20%
stake in Cairn India).
Although the Vedanta management ramped up volumes from 11mt in FY07 to 20mt in
FY11, a further significant volume ramp-up appears ambitious. In an attempt to clamp
down on illegal mining, the issuance of new mining leases and approvals has slowed
drastically in India. The Supreme Court recently banned mining in Karnataka due to
concerns about environment degradation and to investigate illegal mining activities.
Similar investigations have been initiated in Goa by the MB Shah Commission
(appointed by the central government); which might impact SESA's volume growth.
We expect FY12 volumes to shrink due to a mining ban in Karnataka
SESA's FY12 iron ore volumes will be impacted by a ban on mining in Chitradurga
and Tumkur districts in Karnataka to curb illegal mining and prevent further environmental
damage. We expect SESA's FY12 volumes to shrink as production stopped from 27
August at Karnataka. SESA has ~800k tons of inventory, which will be liquidated at
an e-auction, conducted by MSTC. Consequently, we have cut FY12 volume estimates
to 18.2mt from 21.3mt earlier.


IC/CE ratio falls from 48% in FY07 to 25% in FY11, will decline further
Although SESA's invested capital in its core business increased over FY07-11 from INR8b
to INR35b, we expect it to decline, going forward. SESA's cash flow from operations was
strong over FY07-11 but it could not invest into its core business (except investment in
Dempo) for lack of the right opportunity. Purchase of Cairn India's 20% stake to aid the
parent company and diversify its product portfolio raised concerns over management's
capability of efficient usage of capital. IC/CE dropped from a healthy 48% in FY07 (from
over 50% before that) to 25% in FY11 and we expect it to decline to 11% in FY13.
Downgrade to Neutral due to rising risks to volume growth
Although SESA continuously reduced its cost of mining since its acquisition by Vedanta,
rising royalty rates and export duties will drag down EBITDA. An increase in taxes after
the implementation of the MMDR Bill will impact margins over FY11-13.
Chinese iron ore import prices have not softened since six months and continue to rise in
anticipation of supply constraints and strong demand. However deteriorating outlook for
developed economies and apparent slowdown in Chinese manufacturing activity can pull
down ore prices in the near term. Over 4-5 years, ~730mt of iron ore supplies are expected
to add to the existing 1b tons of seaborne iron ore trade, which will ease a tight market.
We downgrade the stock to Neutral as risks to volume growth in merchant mining business
are rising.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

JSW Steel: TP: INR453 Sell: Motilal Oswal

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Difficult to replicate past growth
Volumes and margins hit by iron ore shortage
 Lowest RoIC but superior ASR over FY07-11.
 RM scarcity and current headwinds to hit production and drag stock
performance despite superior capital allocation plans.
 JSTL will find it difficult to replicate past growth. Maintain Sell.
Superior ASR, lowest RoIC over FY07-11 but RM scarcity hits output
Over FY07-11 JSW Steel (JSTL) posted superior annualized stock return of 20%
despite having the lowest RoIC among key steel makers. This was due to efficient
capital allocation and excellent project execution. Over the past decade, JSTL expanded
its crude steel making capacity 6x to 10mtpa at Vijaynagar. Its saleable steel volumes
increased at a CAGR of 23% to 6.1m tons over FY05-11. The UnIC/CE ratio has
remained lowest in the industry due to efficient capital allocation.
Despite investing over INR335b and being assured of a mining lease from the
government, JSTL could not achieve sufficient raw material integration in iron ore rich
Karnataka. Resultant, recent Supreme Court ban on iron ore mining in Karnataka has
affected its operations. While JSTL expects some relief from the Supreme Court's
orders (to auction iron ore stocks lying idle in the state and allow NMDC to mine up to
12mtpa in Bellary) and recently added iron ore beneficiation and pellet facilities will
help to some extent; we expect volumes and margins to be impacted in FY12. We
believe the ongoing saga will also change the demand-supply equation of iron ore in
Karnataka and costs for local steel producers permanently. We have cut FY12 volumes
from 8.5mt earlier to 6.7mt and increased average iron ore cost from USD60/ton to
~USD90/ton.

Headwinds to drag down stock performance
Despite recent headwinds, JSTL is committed to superior capital allocation with planned
capex in West Bengal and increasing focus on raw material security. In West Bengal,
JSTL is undertaking a 4.5mtpa green-field steel project with capex of INR160b to be
executed over four years. Coking coal blocks of Kulti, Sitarampur and Rohne have been
allotted. Iron ore will be sourced through slurry pipelines from Orissa/Jharkhand.
Global projects undertaken over the past few years to secure raw material sourcing will
increase integration. Shipments from US coal mines have started and we expect JSTL to
receive 350k tons of coking coal in FY12. The company's Chile iron ore mines will produce
1mtpa of iron ore.
However, we believe that in the near to medium term, returns from invested capital will
weaken and drag down RoCE, resulting poor stock performance. The next driver of earnings
from further capacity addition will take a few years and higher interest and depreciation
costs (due to the recently commissioned expansion in Vijaynagar) will impact JSTL's
bottom line.
Difficult to replicate past growth
Over FY07-11 JSTL generated INR170b operating cash flow and invested INR262b in
assets, raising INR170b from debt and equity (in the ratio of 63:37). With deteriorated
business conditions, we expect JSTL to generate INR83b from operations over the next
two years. Although the stock trades at a 56% discount to NAV and P/BV of 0.9x, further
de-rating is possible because JSTL will find it difficult to replicate its past growth with
lower margins unless the iron ore supply situation at Bellary improves. Planned investments
in West Bengal and at JSW Ispat will increase leverage. Maintain Sell.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

SAIL: TP: INR113 Sell: Motilal Oswal

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Project execution disappoints
Fixed costs still rising; Maintain Sell
 CWIP up, drags down RoCE due to project delays; Expansion benefits will
start kicking-in in 2HFY13.
 Rising operating costs impact RoE but RoIC will be highest among peers.
 Net debt to rise USD3.8b but D/E comfortable if expansion is not delayed.
 Stock appears to be expensive, maintain Sell.
Rising CWIP drags RoCE to 13%; Expansion benefits in 2HFY13
SAIL undertook brown-field expansion across its locations along with modernization
of its existing facilities in 2005. However it faced cost and time overruns due to slow
execution and slowdown in the global economy in 2008. A blast furnace at ISP Burnpur
(2mtpa) is expected to be commissioned by March 2012. However, the BOF will take
some time for commissioning and capacity utilization is unlikely to cross 50% in the
first six months after the start up. Thus, incremental saleable steel volumes will be
available only in 2HFY13.
SAIL is expected to commission two blast furnaces of 2.5mtpa each in Rourkela and
Bhilai in FY13. The delayed commissioning has affected SAIL's return ratios. CWIP
as a percentage of capital employed increased from 8% in FY07 to 45% in FY11 and
is expected to increase to 56% in FY13. This is dragging RoCE as project execution is
slow. RoCE declined from 47% in FY07 to a mere 13% in FY11.
Over FY11-13 we expect SAIL to post volume CAGR of 8% to 13.8mt. However
margins will improve only after the completion of modernization of SAIL's old plants,
addition of downstream facilities and development of new coal mines.


Rising operating costs impact RoE; but RoIC will be highest among peers
Over FY07-11, SAIL's profitability was impacted badly by rising coking coal costs, labor
cost and other operating costs. This has impacted RoE, which slipped from 42% in FY07
to 12% in FY11. Ongoing capacity expansion will ensure specific labor cost remains at
similar levels, but per ton labor cost will still be highest among key players. Over 2001-10,
sustenance capex has been just USD11/ton/year, resulting in further deterioration of ageold
machinery. This however is being corrected through its INR720b capex plan and
INR158b (USD269/ton over five years) is being spent on sustenance.
Over FY07-11, the share of invested capital fell from 50% to 22% as it made significant
capex only recently, which is lying in CWIP. However going forward, as the facilities start
coming on stream, IC will increase. RoIC will continue to decline as RoIC on new facilities
will be much lower due to higher invested capital. SAIL is investing INR540b on its
incremental 7mtpa of production which will drag RoIC but it will still be the highest among
its peers (except JSP).


We expect earnings growth to be lackluster over FY11-13 despite an 8% volume growth
due to SAIL's uncompetitive cost structure and poor operating efficiencies. Return ratios
will decline until FY13. The benefits of its INR720b capex will be seen only in FY15. Over
the past few years, SAIL has traded in line with its NAV. In FY11 it traded at a discount
to its NAV as it could not meet the deadline of commissioning its ISP Burnpur project. At
CMP of INR107, the stock trades at a 53% discount to NAV and it appears to be expensive
at 11.2x FY13E EPS and an EV of 7.7x FY13E EBITDA. Maintain Sell.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Jindal Steel & Power: TP: INR729 Buy: Motilal Oswal

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The best performer
Strong project pipeline though challenges remain
Despite its below-average RoIC, Jindal Steel and Power (JSP) has been the
best performing stock among the metals companies under our coverage due
to better capital allocation in high RoI business and timely execution.
 Strong volume growth in steel and power, healthy cash-flow. Challenges
now lies in deploying it with equal speed.
 Strong project pipeline, but execution has been suffering due to issues
such as land acquisition and regulatory permissions.
 Though there are some delays, we like JSP's due to its well planned
expansion projects and rich mineral resources. Maintain Buy.
Strong volume growth in steel and power businesses
Steel sales will grow from 1.9mt in FY11 to 2.4mt in FY12 due to a ramp-up of
production at Raigarh and 2.7mt in FY13 on account of contribution from Angul projects
during the second half. Pellet production is expected to ramp up from 2.8mt in FY11 to
4.4mt FY12 and FY13. The sale of pellets will decline in FY13 due to increase in
internal consumption at the Angul sponge iron unit.
Power volume will increase as the remaining seven units of a 135MW captive power
plant will be commissioned at Angul and Raigarh. Margins, however, will be under
pressure because of low rates offered by SEBs to captive power plants and high cost
of purchase of third-party coal.


Earnings growth to pick up in FY13; maintain Buy
Earnings growth will slow in FY12 due to shrinking margins in the power business. However,
earnings are expected to grow stronger in FY13 due to expectation of improvement in
power rates and the start of the Angul coal mine.
Unlike other steel stocks, JSP has begun to trade at a premium to replacement costs due
to significant growth in the share of earnings from power sales.
We like the stock due to its strong pipeline of projects and cash flow. The stock trades at
a PE of 9.2x FY13E. Maintain Buy, with an SOTP-based target price of INR729.

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Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Tata Steel :TP: INR693 Buy: Motilal Oswal

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Growth in high margin business to drive RoCE
D/E lowest since TSE acquisition and to fall further
 Outperforms other steel stocks after four years of weak stock performance.
 RoCE to improve by FY13 as most capital is employed in its core business and
CWIP/CE will decline.
 TATA will reduce debt by USD2b, despite using ~USD4b on capex, over two years. It
will generate cash flow of USD8b.
 Pension fund deficit concerns unfounded.
 Despite an uncertain European outlook, Tata Steel Europe is better equipped to
cope with a downturn.
 The stock trades at attractive valuations and at a 58% discount to NAV.
Reiterate Buy.
RoCE to improve as CWIP/CE will decline in FY13
Tata Steel (TATA) has been one of worst performing stocks over FY07-11, delivering
just 4% annualized total stock returns (ASR). This trend has changed over past 12
months as the stock outperformed its peers in the sector as it reversed a declining
trend in RoIC.
Volume growth in the high margin Indian business will boost RoIC hereon as TATA
expands its capacity by 3mtpa to 10mtpa in Jamshedpur by the end of FY12. Since
TATA is among the few metals companies with most of its capital employed in its core
business, RoCE will improve in FY13. The CWIP/CE will be the smallest for TATA in
FY13. We expect TATA to outperform other metals stocks because sector RoCE will
keep declining.


Net debt reduction of USD2b despite huge capex
TATA will reduce debt by USD2b to USD8.6b, despite using ~USD4b on capex, over two
years. USD6.2b of operating cash flow and USD1.7b from liquidation of investment,
interest and dividend will generate USD8b in cash flow. After incurring capex of USD4b
and USD2b as payment of interest and dividend, net debt will fall by USD2b. This will
strengthen the balance sheet significantly as net worth will rise to USD11.3b and debt-toequity
will fall to 0.8x. After adjusting for goodwill of INR153b from net worth, net debtto-
equity ratio will be 1.1x.


Pension fund deficit concerns unfounded
Pension fund surpluses were USD556m and USD401m at the end of March 2011 and
June 2011 respectively. TATA invested 29% of its total BPSP assets of GBP11.3b in
equities and 63% in bonds and the rest of the funds were invested in cash and properties.
Since the end of March 2011 the FTSE fell 10% and bond yields fell 30-70bp.


Although it is difficult to accurately gauge the movement of surpluses, it is possible to get
a sense of the possible direction of the movement. We have assumed average duration of
the bond portfolio and pension liabilities to be 10 years each. According to our calculations,
the mark to mark valuation of equities will be down by 10%, or about GBP317m, assuming
similar returns as the FTSE. On the other hand, the valuation of the bond portfolio may
have risen by GBP856m assuming 70bp decline in yield. Pension liabilities would have
risen by GBP329m assuming AA bond yield decline by 30bp. So, on a net basis, the surplus
would have increased by GBP209m. We would also like to highlight that pension funds
have passed the litmus test of the 2008 financial crisis without requiring additional
contribution from TSE.


European outlook uncertain but TSE now better equipped
The earnings outlook for TSE (Tata Steel Europe) is uncertain due to economic problems
in Europe and other western countries. Weaker demand may force some production cuts
and margins will come under pressure for a couple of quarters. It is worth noting here that
TSE operates as a converter though margins are thin. The structure of finished products
and raw material contracts has undergone major change to better withstand volatility in
commodity prices since the financial crisis of 2008. Finished steel contracts have now
moved closer to spot prices and quarterly pricing. Similarly, iron ore and coking coal contracts
moved from annual pricing to quarterly and monthly pricing.
Operation restructuring at several units reduced fixed costs significantly. On our recent
visit to TSE, we learned the company is now moving towards value-added products to
move up the value chain and reduce earnings volatility. The Ijmuiden plant has the best
operating efficiencies and product mix in the world. TCP (Teesside Cast Products) has
been sold. Therefore, we understand TSE is now better equipped to withstand a financial
crisis. After achieving significant fixed-cost reduction, TSE aims to improve margins and
has stepped up investment. Recently, TSE announced USD1.1b capex for the Imjuiden
unit to expand saleable steel capacity and further improve operating efficiencies. We
believe TSE will be able to improve productivity and capital efficiencies year after year as
it replicates its best practices across the group.





Valuations attractive
TATA's earnings will grow 29% in FY13 driven by 33% volume growth in the high margin
Indian business as capacity expansion at Jamshedpur is completed by the end of March
2012. RoIC and RoCE will improve. The balance sheet is stronger now due to generation
of USD2.65b over nine months by way of sale of TCP (USD470m), settlement (USD130m)
of arbitration for breach of off-take agreement, stake sale in the Riversdale parent company
(USD1.1b) and TRF (USD150m) and rights issue (USD800m). Despite USD4b of capex
over 2 years, net debt will come down by USD2b by the end of FY13. Net debt-to-equity
(less goodwill) ratio will fall from 2.4x at the end of FY11 to 1.1x by the end of FY13.
TATA has investments in Tata Motors (TTMT) worth USD526m, coking assets in
Mozambique worth USD1b and iron ore assets in Canada worth USD367m, totaling nearly
USD2b. These assets will start generating cash flow over 6-12 months, yielding RoIC of
20-25% (ex-TTMT).
TATA traded at premium to NAV (taking into account replacement cost for fixed assets)
until FY07. After the acquisition of Corus, the stock traded at a discount to NAV because
of low margins in the international business. At CMP of INR433, the stock trades at a
deep discount of 57% to NAV. Such discounts to NAV were only seen in 2009 (~51%).



sector report and other companies

Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

Metals and Mining, RoIC v/s RoCE: The Return Roulette :: Motilal Oswal

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RoIC v/s RoCE: The Return Roulette
Re-investment challenges drag RoCE; Stocks at deep discount to NAV
THEME SUMMARY: We have observed distinct inter-relations of RoIC, RoCE and
ASR (annualized stock return) among large-cap metal companies:
1. Superior capital allocation boosts ASR, even if RoIC is modest in some cases
(Tata Steel, JSW, Nalco)
2. RoCE keeps declining due to rising share of CWIP (SAIL, Jindal Steel & Power,
Hindalco) or un-invested capital (Hindustan Zinc)
3. Capital deployment into group companies and/or unrelated businesses
suppresses RoCE and hurts ASR (Sesa Goa, Sterlite Industries).
Stock recommendations: Reiterate Buy on Tata Steel; downgrade Sesa Goa to
Neutral (from Buy); and upgrade Nalco to Neutral (from Sell).
RoCE to keep declining due to rising share of CWIP, un-invested capital
The aggregate RoCE of key Indian metals companies will keep declining though the
aggregate RoIC (pre-tax) is still healthy at about 40%. A large share of un-invested capital
and capital work in progress (CWIP) will drag RoCE though RoIC will not deteriorate. Over
2000-05, the share of un-invested capital rose as margins and cash flows grew faster than
companies could reinvest. Post 2005, Indian metals companies made big investments in
core business. Project execution slowed significantly in FY11 and FY12 due to delays in
receiving government approvals and problems related to land acquisition. Consequently,
the share of CWIP in total capital employed (CE) increased from 11% in FY08 to 23% by
end-FY11, and is expected to rise to 27% by end-FY12. At end-FY11 only 49% of CE was
invested in the core business. This (IC/CE) ratio will fall to 45% in FY12 and FY13.
Superior capital allocation drives equity value faster despite modest RoIC
Over FY07-12 metals companies generated average RoIC of 61% but the annualized
stock return (ASR) was just 16% due to continually declining RoCE. JSPL and JSW Steel
delivered superior ASR due to superior capital allocation and execution despite below
average RoIC. Hindustan Zinc, Sterlite and Sesa Goa generated the best RoIC but ASR
was dragged due to investor concerns on allocation of capital to group companies. High
priced acquisitions dragged the ASR of Tata Steel and Hindalco. Nalco suffered due to
declining RoIC and slow reinvestment.

CLICK LINK BELOW FOR COMPANY REPORTS

Tata Steel :TP: INR693 Buy: Motilal Oswal

Jindal Steel & Power: TP: INR729 Buy: Motilal Oswal

SAIL: TP: INR113 Sell: Motilal Oswal

JSW Steel: TP: INR453 Sell: Motilal Oswal

Sesa Goa: TP: INR288 Neutral : Motilal Oswal

Hindalco: TP: INR226 Buy : Motilal Oswal

Hindustan Zinc: TP: INR183 Buy: Motilal Oswal

Nalco : TP: INR77 Neutral :Motilal Oswal

Sterlite Industries: TP: INR193 Buy: Motilal Oswal

CLICK LINK ABOVE FOR COMPANY REPORTS

Are Credit Spreads Pricing Recession? ::Goldman Sachs,

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Are Credit Spreads Pricing Recession?
Credit spreads in Europe and the US have
widened sharply over the past several months.
The sell-off has been most pronounced in
Europe, especially in financials, where
corporate spread levels have more than
doubled since May. Many credit indices are
indicating spread levels that have historically
been seen only in recession.
In this Global Economics Weekly, we solve for
the economic growth outlook implied by the
current level of credit spreads. We conclude
that credit spreads are signalling growth that is
weaker than we have thus far seen in the data.
That said, looking forward, the range of
implied growth rates is broadly consistent with
our economic forecast over the next few
quarters, although more so in Europe than in
the US.
In our view, credit markets are probably no
better as a predictor of future economic
activity than any other market (and in many
respects may be worse). Our reading of the
historical evidence suggests that credit spreads
are more forward-looking when the economic
shock originates in the banking/financial
sector. Otherwise, spreads tend to look
backwards, widening out only when defaults
are imminent (which is often too late). This is
consistent with conventional wisdom on
behaviour of credit ratings, too.
We admit important exceptions to this view,
however. Credit spreads, especially on
financials, ought to be more sensitive to
systemic shocks than to garden variety
recession shocks; they have therefore been
closer to the epicentre of the current crisis than
competing indicators. Given the origins of the
current crisis, it merits paying close attention
to what the credit markets are trying to tell us
about the risks to growth.

Buy Oberoi Realty : target INR 284:: Nomura research,

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2QFY12F results- Revenue above estimates; maintain BUY
•
Earnings vs. our Forecast:
ABOVE
Likely Impact:

Oberoi Realty 2QFY12 PAT of INR 1,114 mn (+17%y-y & +5%q-q) was largely in line with our expectations but revenue came in ahead of our estimates. This deviation in revenue was principally on account of completion of its Oberoi Splendor project during the quarter and better-than-expected construction progress at its residential projects during the monsoon season. Overall residential sales dropped q-q from INR 2.6bn to INR 2.3bn as buyers turned price sensitive, while performance of investment properties remained steady. We expect a neutral reaction to these set of numbers. Maintain BUY.

· 2QFY12 operating revenue of INR 2,226 mn (+31%y-y and +38%q-q) came in ahead of our expectation of INR 1,780 mn which was owing to completion of its Oberoi Splendor project (approx. 1.3mn sq ft) during the quarter and better-than-expected construction progress at its residential projects during the monsoon season. However, overall sales momentum at its ongoing residential projects was in line with our expectation as the company achieved sales of INR 2,319 mn (vs. INR 2,619 mn in 1QFY12), with project Esquire continuing to drive a large chunk of sales.
· In terms of pricing, overall ASP achieved across all its ongoing projects rose 3% q-q from INR 12,123 psf to INR 12,467 psf. But on an individual project level, ASP achieved was lower between 1-11% q-q, implying buyers have turned price sensitive and are picking up lower-priced units, in our view.
· The performance of investment properties remained steady q-q, as Oberoi Mall continues to see a high occupancy level of 94% in 2QFY12 (vs. 94% in 1QFY12, and 90% in 4QFY11). The occupancy at Commerz I also remained flat q-q at 76% in 2QFY12 vs 76% in 1QFY12 and. 77% in 4QFY11, although it was expected to go up as the company had signed a LOI with a tenant in the previous quarter, the benefit from which was expected to flow from 2QFY12.
· Overall EBITDA margin of 52% (-7%y-y & -4%q-q) was lower-than-our expectation of 56% but this difference was attributable to a larger contribution coming from the development projects during the quarter, which have lower margins when compared to margin on investment properties (approximately 95%).
· 2QFY12 EBITDA of INR 1,155 mn (+15%y-y and 28%q-q) was 16% ahead of our expectation of INR 996mn. However, this better-than expected EBITDA was slightly offset by lower other income (INR 343 mn vs expected INR 426 mn), that resulted in PAT (INR 1,114 mn, +17%y-y & 5%q-q) coming in only 6% ahead of our expectation.
· During this quarter, in September the company acquired ICICI venture’s 50% stake in a Worli residential plot. At the time of the announcement, the company did not disclose the price at which the stake was bought but it was reported in the Economic Times (29 September 2011 - Oberoi Group in talks to buy 50% in south Mumbai project held by ICICI Venture) that the company was expected to pay INR 3.0 bn. The price quoted in the Economic Times appears more or less in line with our estimate of INR 3.15bn based on 2QFY12 accounts. We have estimated that the company will be able to generate an IRR of around 36% on this deal, if all goes as per plan. Please see our note ICICI Venture deal: NAV accretive; achievable IRR ~36%, CLICK HERE for more details.


On the balance sheet front, the cash (including investment in mutual funds) available with the company fell from INR 15.6bn (in 1QFY12) to INR 13.5bn (2QFY12) on account of payment made towards Worli residential plot. The company has been looking to deploy cash towards land acquisition and according to a report in the Economic Times (dated 30 September 2011 - HUL shortlists 6 bidders including Gautam Adani, Oberoi Realty and Peninsula Land for Worli sea-facing plot) Oberoi Realty is among the six shortlisted bidders for Hindustan Unilever sea facing property in Worli. The property is expected to be sold for INR 4.0bn according to the news report.
· Overall, we expect a neutral reaction to these set of results. We maintain a BUY on the stock as it is available at a 21% discount to our NAV of INR 284 per share.

Valuation Methodology and Investment Risks: Valuation Methodology and Investment Risks: Valuation methodology: We used net asset value methodology to arrive at our NAV estimate of INR 275 per share. We estimate additional value accretion of INR 8 per share to arrive at our target price of INR 284 per share. We don’t ascribe any discount to our target NAV of INR 284 per share due to high level of transparency and corporate governance and strong balance sheet. Investment risks: 1) Oberoi Realty is largely a Mumbai-based developer; hence any slowdown in sales volume or correction in home prices / correction in commercial rents due to a worsening macroeconomic scenario would have an impact on our NAV estimates. 2) Given Worli and Sangman City projects, which contribute nearly 16% to our GAV estimate, are being executed with JV partners, any problems arising from JV partners owing to a chequered history could lead to a stalling of these projects. 3) Inability to deploy cash in value-accretive land acquisition could have a significant impact on our estimates.

Reports on TCS Q2FY12 results - by IDFC Sec

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Tata Consultancy Services (TCS IN)
Marginally below expectations


Q2FY12 result highlights
Quarterly performance: TCS’s reported revenue and EPS growth was marginally below our and Street expectations. USD
revenues grew by 4.7% qoq to US$2.53bn, below our estimate of US$2.55bn. INR revenue growth of 7.7% qoq was driven
by volume growth of 6.2% and a 3.1% INR depreciation, notwithstanding ~60bp impact of cross-currency headwinds and a
pricing realization decline of 1% (-0.95% due to like-on-like pricing and -0.05% due to offshore shift). EBIT margin expanded
by ~90bp qoq (in line with our expectations), with currency impact (+166bp) partially offset by costs related to promotions
and fresher hiring. Lower other income led to net profit growth of 2.5% qoq to Rs24.4bn (IDFC est.: Rs25.4bn).
Key positives: TCS won 10 large deals in Q2 across geographies and verticals and is pursuing over 10 large deals; the
pipeline remains healthy; net hiring was robust at ~13k in Q2; TCS plans ~60k gross hiring in FY12 and has already made
~35k campus offers for FY13. Clients migration was seen across the pyramid – $100m+ to $1m+.
Key negatives: Sequentially, India INR revenues declined by ~4%. Telecom declined by ~4% and ADM grew by just ~1%.
Impact on financials
We raise FY12/13E earnings by 4-5% despite a marginally disappointing Q2 as we build in the weaker INR into our estimates
(Rs48/ 47 for 2H12/ FY13, vs. Rs44/ 43 earlier). We expect ~27% USD revenue growth, largely flat margins, and 24% EPS
growth in FY12. Management commentary was incrementally cautious on the environment, but optimistic about the pipeline
and IT spends. We have introduced FY14 forecasts.
Valuations & view
The stock might move sideways in the near term as the Q2 results lacked positive surprises. Yet we believe that TCS is relatively
well placed to sail through the challenging environment for IT  services vendors. TCS and Infosys are key holdings in IDFC
model portfolio despite our underweight  stance on the sector. We value TCS at  Rs1,230 based on 19x FY13E EPS (from
Rs1,180 earlier) for a 12-month price target. Trading at ~20x FY12E and ~17x FY13E, we maintain Outperformer on the stock.
We note, however, that TCS’s relatively premium multiples in the uncertain macro environment could keep upside potential
capped in near to medium term.

BSE, Bulk deals, 18/10/2011

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Deal Date	Scrip Code	Company	Client Name	Deal Type *	Quantity	Price **
18/10/2011	531560	Aroma Enterprises	NISHITH BABULAL SHAH	B	35800	82.00
18/10/2011	590114	Arunjyoti Enterprises	RAJUL PREMAL DOSHI	B	31000	72.00
18/10/2011	530187	Atharv Enter	MEENAKSHI JATIA	B	39000	28.25
18/10/2011	530187	Atharv Enter	TRUSHA PRANAY MEHTA	S	35000	28.15
18/10/2011	531364	Choice Infra	REKHA LALIT JAIN	B	50000	36.40
18/10/2011	531364	Choice Infra	UMANATH RAGHUNATH AGARWAL	B	39212	36.40
18/10/2011	531364	Choice Infra	NIAGARA FINANCIAL CONSULTANTS PRIVATE LIMITED	S	100000	36.40
18/10/2011	530393	DB Intl Stock	SANJAY SINGAL HUF	S	198052	94.46
18/10/2011	508860	DIAMANT	KIRAN BHIKU BHANAES	B	207799	19.49
18/10/2011	531055	GFLFIN	MINALBEN RAJESHKUMAR SHAH	S	19600	97.90
18/10/2011	533402	Innoventive Ind	STANDARD CHARTERED PVT EQ MAURITIUS LTD	B	1249954	93.00
18/10/2011	533402	Innoventive Ind	LOTUS TIE UP PRIVATE LTD	S	390990	93.39
18/10/2011	533402	Innoventive Ind	NILE ENTERPRISES PVT LTD	S	416650	93.00
18/10/2011	530955	Kailash Ficom	DASH PHARMACEUTICALS PVT LTD	S	94783	32.03
18/10/2011	530165	Kanchan Intl	PRANAV NARENDRA BHATT	B	18280	47.29
18/10/2011	530165	Kanchan Intl	DHARMENDRA HARILAL BHOJAK	B	37088	43.40
18/10/2011	530165	Kanchan Intl	DHARMENDRA HARILAL BHOJAK	S	19659	47.37
18/10/2011	530165	Kanchan Intl	SAGAR MUKESHKUMAR CHOKSI	S	23000	41.80
18/10/2011	532067	Kilpest India	CHIRAG D PAREKH	S	41000	17.70
18/10/2011	523550	Krypton Inds	HULASH CHAND TARA CHAND BARDIA	B	60000	15.00
18/10/2011	523550	Krypton Inds	TARA CHAND JALAN	S	60000	15.00
18/10/2011	519279	Madhur Inds	NIRAVBHAI PAYAL	B	25000	68.65
18/10/2011	519279	Madhur Inds	BABU HARDAV	B	25000	68.75
18/10/2011	519279	Madhur Inds	GAURANGSINH GHANDHAMSINGH CHUDASAMA	B	22100	69.03
18/10/2011	519279	Madhur Inds	NILESH VASANTBHAI PATEL	S	49800	68.70
18/10/2011	532045	Nexxoft Info	DODAKKA SRINIVAS RAO	B	66730	11.48
18/10/2011	532045	Nexxoft Info	RAMESH VENSIMAL TOLANI	S	82354	11.42
18/10/2011	533632	Onelife Capital	SHREE MALLIKARJUN TRADINVEST PRIVATE LIMITED	B	155500	160.29
18/10/2011	533632	Onelife Capital	BMD EXPORTS PRIVATE LIMITED	B	225209	172.64
18/10/2011	533632	Onelife Capital	A K G SECURITIES AND CONSULTANCY LTD	B	257957	158.27
18/10/2011	533632	Onelife Capital	CHANDARANA INTERMEDIARIES BROKERS PRIVATE LIMITED	B	83456	159.13
18/10/2011	533632	Onelife Capital	GKN SECURITIES	B	137274	157.87
18/10/2011	533632	Onelife Capital	R M SHARES TRADING PRIVATE LIMITED	B	157248	159.36
18/10/2011	533632	Onelife Capital	R M SHARES TRADING PRIVATE LIMITED	S	157248	160.09
18/10/2011	533632	Onelife Capital	GKN SECURITIES	S	137274	158.58
18/10/2011	533632	Onelife Capital	CHANDARANA INTERMEDIARIES BROKERS PRIVATE LIMITED	S	82730	160.61
18/10/2011	533632	Onelife Capital	A K G SECURITIES AND CONSULTANCY LTD	S	257957	158.17
18/10/2011	533632	Onelife Capital	PRAKASHBHAI ISHWARBHAI RANA	S	185000	172.63
18/10/2011	533632	Onelife Capital	SHREE MALLIKARJUN TRADINVEST PRIVATE LIMITED	S	155500	174.51
18/10/2011	511702	Parsharti Inv	BIMAL PAWANKUMAR PARASRAMPURIA	B	24956	12.96
18/10/2011	511734	Pasupati Fin	PASUPATI OLEFIN LTD	S	50000	15.70
18/10/2011	533581	PG Electroplast	RESHMA NIMIT SHAH	B	107162	232.95
18/10/2011	533581	PG Electroplast	RESHMA NIMIT SHAH	S	107162	231.46
18/10/2011	533605	Prakash Constrowell	CHAMPAKLAL NARSHIBHAI PUJARA	B	123005	182.98
18/10/2011	533605	Prakash Constrowell	CHANDARANA INTERMEDIARIES BROKERS PRIVATE LIMITED	B	114417	182.52
18/10/2011	533605	Prakash Constrowell	GKN SECURITIES	B	79227	183.92
18/10/2011	533605	Prakash Constrowell	A K G SECURITIES AND CONSULTANCY LTD	B	76821	184.43
18/10/2011	533605	Prakash Constrowell	Quadeye Securities Pvt Ltd	B	159750	182.88
18/10/2011	533605	Prakash Constrowell	Quadeye Securities Pvt Ltd	S	159750	182.52
18/10/2011	533605	Prakash Constrowell	A K G SECURITIES AND CONSULTANCY LTD	S	76821	184.41
18/10/2011	533605	Prakash Constrowell	NITIN BABAJI PALANDE	S	69244	175.47
18/10/2011	533605	Prakash Constrowell	GKN SECURITIES	S	79227	184.77
18/10/2011	533605	Prakash Constrowell	CHAMPAKLAL NARSHIBHAI PUJARA	S	96005	188.60
18/10/2011	533605	Prakash Constrowell	CHANDARANA INTERMEDIARIES BROKERS PRIVATE LIMITED	S	114417	182.71
18/10/2011	533239	Prakash Steelage	AASHIRWAD VINCOM PRIVATE LIMITED	B	100000	123.37
18/10/2011	530923	RCL FOODS	BLUE PEACOCK SECURITIES PRIVATE LIMITED	S	56000	96.96
18/10/2011	533608	RDB Rasayans	AARAV FINANCIAL SERVICES PRIVATE LIMITED	B	227065	16.43
18/10/2011	533608	RDB Rasayans	SHREE MALLIKARJUN TRADINVEST PRIVATE LIMITED	B	100000	16.80
18/10/2011	533608	RDB Rasayans	AARAV FINANCIAL SERVICES PRIVATE LIMITED	S	227065	16.80
18/10/2011	511585	Regency Trust	DEEPAK RAMANLAL THAKKAR	S	63694	67.50
18/10/2011	513583	SB&T Intl	ZODIAC TRADELINK PRIVATE LIMITED	B	90000	15.65
18/10/2011	526133	Supertex Inds	SEEMA GANDHI	B	99065	6.26
18/10/2011	526133	Supertex Inds	AMRIT LAXMICHAND GANDHI	B	59719	6.30
18/10/2011	526133	Supertex Inds	PARUL ANUPAM KHANNA	S	159786	6.27
18/10/2011	533101	SURYAMBA SP	VINODCHANDRA MANSUKHLAL PAREKH	B	14547	29.89
18/10/2011	533629	Tijaria Polypipes	A K G SECURITIES AND CONSULTANCY LTD	B	162792	17.16
18/10/2011	533629	Tijaria Polypipes	GKN SECURITIES	B	244994	17.29
18/10/2011	533629	Tijaria Polypipes	GKN SECURITIES	S	244994	17.22
18/10/2011	533629	Tijaria Polypipes	A K G SECURITIES AND CONSULTANCY LTD	S	162792	17.08
18/10/2011	531831	Unisys Soft	MOONSTAR SECURITIES TRADING & FINANCE CO P LTD	B	200000	64.81
18/10/2011	531831	Unisys Soft	SKYLIGHT DISTRIBUTORS PRIVATE LIMITED	S	130000	65.35
18/10/2011	531015	VENMAX	RAJEEV KUMAR HARDATT	B	120000	3.27
18/10/2011	531015	VENMAX	CHANDRAKANT B SHAH	S	120000	3.27
* B - Buy, S - Sell
** = Weighted Average Trade Price / Trade Price