IndiaEquityResearch

Automobiles

February23,2012

EicherMotors

ADD
TargetPrice(INR)

1,918

StrongmomentuminHCVsandmotorcycles

INITIATINGCOVERAGE
LastPrice(INR)

1,724
EIMIN

Bloombergcode
Reuterscode

EICH.BO

Avg.Vol.(3m)

16,209
26.0

Avg.Val.(3m)(INRmn)

1,845/995

52wkH/L(INR)

18,145

Sensex
MCAP(INRbn/USDmn)

46.55/946

Shareholding(%)

9/11

12/11

Promoters

55.2

55.2

MFs,FIs,Banks

17.4

18.4

FIIs
Public
Others

6.0

6.2

11.0
10.4

11.0
9.2

EIMshighgrowthtrajectoryinCVs,whichstartedwiththeassociation
withVolvoinJul08,islikelytocontinueongrowingacceptanceofthe
companys HCV vehicles by freight operators. We estimate domestic
CV sales volumes to grow at a CAGR of 10% over 2012f2014f.
Domestic motorcycle sales volumes are also likely to continue their
growth trajectory at a CAGR of 26% over 2012f2014f, and led by a
healthy order book. Robust sales volume growth in CVs and
motorcycles is likely to result in positive operating and financial
leverage over 2012f2014f. We have used the relative valuation
methodtovalueEIMsstandalonebusinessanditsstakeinVECV.Our
SOTPbased Mar13 target price for EIM stands at INR1,918, which
provides a 11% upside. Initiate with an Add rating. Risk factors are
higherrawmaterialcostsandfuelprices.
MomentuminHCVsmaydeliverthreeyearCAGRof10%

StockChart(RelativetoSensex)

EIMhasoutpacedtheindustryinCVsalesvolumessinceitsjointventureVE
Commercial Vehicles (VECV) with Volvo AB (VOLVB SS, NR) in Jul08. We
estimate this trend to continue with domestic CV sales volumes estimated to
growat aCAGRof10%over2012f2014fduetotherisingpenetrationinthe
HCV segment. The HCVs have been well received by freight operators due to
theirlowercostofownership.VECVisalsosettingupanengineplanttolargely
cater to VOLVBs global requirements. We estimate the engine business to
contribute7%and6%ofEIMstotalincomeandEBITDA,respectively,by2014f.

1,900

1,500

1,100

Healthyorderbooklikelytosustainthehighgrowthinmotorcycles

700

Feb11

Jun11

Oct11

Eicher Motors

Feb12

Sensex Rebased

StockPerfm.(%)

1m

3m

1yr

Absolute

6.9

7.8

64.1

1.5

5.2

64.9

Financials(INRmn)

12/11

12/12f

12/13f

Sales

57,160

67,384

77,732

29

18

15

10.4

10.3

10.6

3,088

3,941

4,807

27

27

27

113.8

145.3

177.2

63

28

22
0.4

Rel.toSensex

YoY(%)
EBITDA(%)
A.PAT
Sho/s(diluted)
A.EPS(INR)
YoY(%)
D/E(x)

0.4

0.3

P/E(x)

15.2

11.9

9.7

EV/E(x)

11.2

9.5

7.4

22
26

23
24

23
24

RoCE(%)
RoE(%)
03/11

06/11

09/11

12/11

Sales(INRmn)

QuarterlyTrends

13,897

12,984

14,513

15,766

PAT(INRmn)

733

763 737 854

Pleaserefertothedisclaimertowardstheendofthedocument.

We estimate domestic motorcycle sales volumes to grow at a CAGR of 26%

over2012f2014fduetothehealthyorderbookandcapacityexpansions.EIMs
vehicles continue to witness robust demand, despite entry of new
manufacturers, due to their unique product positioning, wherein cruiser
motorcyclesareofferedatapricesignificantlybelowpeers.

Robusttotalincomegrowthof17%over2012f2014f
Total income is estimated to grow at a CAGR of 17% over 2012f2014f on
accountof robustsalesvolumegrowth.EBITDAmargins arelikely to increase
from10.4%in2011to10.8%in2014fasaresultofimprovementinmarginsin
the motorcycle business. Despite higher depreciation due to the large capex,
PATisestimatedtogrowataCAGRof25%,outpacingEBITDAgrowth.

InitiatewithanAddratingandMar13pricetargetofINR1,918
We use the relative valuation method to value EIMs businesses. We have
valued EIMs standalone business and VECV stake at a 10% discount to
valuationsofHeroMotoCorp(HMCLIN,Hold)andAshokLeyland(ALIN,Buy),
respectively. We have taken the mean EV/EBITDA over the previous cycle of
thesecompaniesandprovidedadiscounttofactorinthedifferenceinbusiness
size.OurSOTPbasedMar13targetforEIMstandsatINR1,918,whichprovides
a11%upside.InitiatewithanAddrating.Riskfactorsarehigherrawmaterial
costsandfuelprices.
SriRaghunandhanNL,+9102266842863
raghunandhan.nl@avendus.com

India Equity Research

EicherMotors

TableofContents

InvestmentSummary ........................................................................................................................ 3
MomentuminHCVslikelytodeliverthreeyearsalesCAGRof10% ....................................................3
Healthyorderbooklikelytosustainhighgrowthinmotorcycles .........................................................3
Robusttotalincomegrowthof17%likelyover2012f2014f................................................................3
InitiatewithanAddratingandaMar13pricetargetofINR1,918 ........................................................3

MomentuminHCVslikelytodeliverthreeyearsalesCAGRof10% ................................................ 5
AssociationwithVOLVBdrivingrobustgrowthinCVs ..........................................................................5
Outsourcingbusinesshashugepotential..............................................................................................6

Healthyorderbooklikelytosustainhighgrowthinmotorcycles ..................................................... 8
Capacityexpansiontomeetdemand ....................................................................................................8
EBITDAmarginslikelytosignificantlyimproveby2014f.......................................................................8
Contributionofmotorcyclesbusinesstoprofitslikelytoincrease .......................................................9

Robusttotalincomegrowthof17%over2012f2014f ................................................................... 10
Strongsalesvolumegrowthinthestandalonebusiness,VECV ..........................................................10
Costcutting,operatingleverageinmotorcyclesaidEBITDAmargins ................................................10
PATgrowthlikelytomarginallyoutpaceEBITDAgrowth....................................................................11

InitiatewithanAddratingandMar13pricetargetofINR1,918..................................................... 12
Strongoutperformanceinstockpriceduetorobustsalesgrowth.....................................................12
Usingrelativevaluationstovaluethestandalonebusiness,VECV .....................................................12
Riskfactors ..........................................................................................................................................14

Financialsandvaluations(consolidated)......................................................................................... 16

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EicherMotors

InvestmentSummary
EIMhasoutpacedindustrygrowthinCVsalesvolumessinceitsetupitsJVVECommercialVehicleswithVolvoABin
Jul08.ThisJVhascreatedapresenceforitselfinthehighgrowingHCVsegment.WeestimateVECVsdomesticCVsales
volumes to grow at a CAGR of 10% over 2012f2014f on account of growing acceptance of the companys HCVs by
freightoperators.TheJVisalsobuildinganengineplanttolargelycatertoVOLVBsglobalrequirements.Weestimate
theenginebusinesstocontribute7%and6%ofEIMstotalincomeandEBITDA,respectively,by2014f.Meanwhile,the
companyiswitnessingrobustgrowthinthemotorcyclebusiness,despiteentryofnewmanufacturersduetoitsunique
productpositioning,whereinitisabletooffercruiser motorcyclesatapricesignificantlybelowpeers.Inlightofthe
strongorderbookandcapacityexpansions,weestimateaCAGRof26%indomesticsalesvolumesinmotorcyclesover
2012f2014f.RobustsalesvolumegrowthinCVsandmotorcyclesislikelytoresultinpositiveoperatingandfinancial
leverage over 2012f2014f. We have used the relative valuation method to value EIMs standalone business and its
stakeinVECV.OurSOTPbasedMar13targetpriceforEIMstandsatINR1,918,whichprovidesa11%upside.Initiate
coveragewithanAddrating.Riskfactorsarehigherrawmaterialcostsandfuelprices.

MomentuminHCVslikelytodeliverthreeyearsalesCAGRof10%
Growingpenetrationin
HCVsegmenttodrive
salesvolumegrowth.

EIMhasgainedmarketshareaftertransferringitsCVbusinesstoaJVwithVolvoAB(VOLVBSS,NR).
This JV VE Commercial Vehicles (VECV) has improved its market share in the domestic MHCV
segment from 7.6% in 2008 to 10.7% in 2011 due to growing acceptance of VECVs HCVs by freight
operators on account of lower cost of ownership. We estimate VECV to largely sustain this market
shareandgrowitsCVsalesvolumesataCAGRof10%over2012f2014f.Meanwhile,VECVissettingup
anengineplanttolargelycatertoVOLVBsglobalrequirements.Weestimatethisenginebusinessto
contribute7%and6%ofEIMstotalincomeandEBITDA,respectivelyby2014f.

Healthyorderbooklikelytosustainhighgrowthinmotorcycles
EIMhasbeenwitnessing
strongdemand,with
waitingperiodsof89
monthsforits
motorcycles.

The companys cruiser motorcycles continue to witness robust demand, despite entry of new
manufacturers. This is on account of unique product positioning, wherein cruiser motorcycles are
offered at a price significantly below peers. Due to this advantage, EIM has been witnessing long
waiting periods of 89 months for its motorcycles. To meet these pending orders, the company is
setting up a new plant. In light of the healthy order book and capacity expansions, we estimate
domesticsalesvolumegrowthof26%inmotorcyclesover2012f2014f.WeestimateEBITDAmargins
in the standalone business to increase from 12.1% in 2011 to 15.5% by 2014f, largely on account of
positiveoperatingleverage.

Robusttotalincomegrowthof17%likelyover2012f2014f
Thecompanyislikelyto
witnesspositiveoperating
andfinancialleverage.

Total income is estimated to grow at a CAGR of 17% over 2012f2014f, on account of robust sales
volumegrowth.DomesticmotorcyclesalesvolumesarelikelytogrowataCAGRof26%,outpacingthe
CAGRof10%inCVsalesvolumesduetorobustdemandandahealthyorderbook.Robusttotalincome
growth is likely to lead to positive operating and financial leverage. EBITDA margins are likely to
increase from 10.4% in 2011 to 10.8% in 2014f, largely on account of positive operating leverage.
Despite higher depreciation due to the large capex, PAT is estimated to grow at a CAGR of 25%,
outpacingEBITDAgrowth.

InitiatewithanAddratingandaMar13pricetargetofINR1,918
Initiatecoveragewithan
AddratingwithaMar13
TPofINR1,918.

EIMhasoutperformedtheBSEAutoIndexandtheNiftysinceannouncementoftheJVwithVOLVBin
Jul08. The outperformance has also been in line with fundamentalssales volumes for motorcycles
andCVsgrewataCAGRof20.3%and25.8%,respectively,over20092011.Wehaveusedtherelative
valuation method to value EIMs businesses. We have valued EIMs standalone business and VECV
stakeata10%discounttothevaluationsofHeroMotoCorp(HMCLIN,Hold)andAshokLeyland(ALIN,
Buy),respectively.WehavetakenthemeanEV/EBITDAoverthepreviouscycleofthesecompaniesand
providedadiscounttofactorinthedifferenceinbusinesssize.OurSOTPbasedMar13targetforEIM

Automobiles

India Equity Research

EicherMotors

standsatINR1,918, which provides a11%upside.Initiatewith anAdd rating. Riskfactors arehigher

rawmaterialcostsandfuelprices.
Exhibit1: OneyearforwardrollingEV/EBITDAandEV/EBITDAattargetprice
20
1yrFwdEV/EBITDA

TargetEV/EBITDA

AverageEV/EBITDA

10

10
Apr07

Feb08

Dec08

Oct09

Sep10

Jul11

May12

Mar13

Source:Bloomberg,AvendusResearch

Exhibit2: Valuationsummary
(INRmn)

Totalincome

EBITDA

NetProfit

EPS(INR)

P/E(x)*

EV/EBITDA(x)*

EV/Sales(x)*

P/B(x)*

Dec10

44,213

3,811

Dec11

57,160

5,935

1,889

70

24.8

17.3

1.5

3.8

3,088

114

15.2

11.2

1.2

Dec12f

67,384

3.2

6,970

3,941

145

11.9

9.5

1.0

Dec13f

2.6

77,732

8,258

4,807

177

9.7

7.4

0.8

Dec14f

2.1

91,624

9,908

6,092

225

.7

5.4

0.6

1.7

Source:Company,AvendusResearchNote:*ProportionateshareofEIMinVECVJVconsideredforcalculationofratios

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EicherMotors

MomentuminHCVslikelytodeliverthreeyearsalesCAGRof10%
EIMhasgainedmarketshareaftertransferringitsCVbusinesstoaJVwithVOLVB.ThisJVVECVhasimprovedits
market share in the domestic MHCV segment from 7.6% in 2008 to 10.7% in 2011 due to growing acceptance of its
HCVsbyfreightoperatorsonaccountoftheirlowercostofownership.WeestimateVECVtolargelysustainthismarket
shareandgrowitsCVsalesvolumesataCAGRof10%over2012f2014f.Meanwhile,VECVissettingupanengineplant
tolargely catertoVOLVBsglobalrequirements. Weestimate thisenginebusinesstocontribute7% and 6% of EIMs
totalincomeandEBITDA,respectively,by2014f.

AssociationwithVOLVBdrivingrobustgrowthinCVs
VECVhasconsistently
gainedmarketsharesince
itsformationinJul08.

EIMowns54.4%stakeinitsCVmanufacturingJVVECV.TheremainingstakeintheJVis ownedby
VOLVB. Since its inception in Jul08, VECV has consistently increased its market share in domestic
MHCVs from 7.6% in 2008 to 10.7% in 2011. We estimate VECV to sustain this market share over
2012f2014f.
Exhibit3: CategorywisedomesticmarketshareforVECV
Segment

Category
Grossvehicleweight(GVW)

Categoryscontributiontodomestic Categorywisemarketshare(%)
CVsalesvolumesofVECV2011(%) 2008
2009 2010 2011

MHCVPassenger 7.512.0tonne

6.5

18.7

18.1

17.2

12.016.2tonne

1.3

0.9

0.5

0.4

1.9

MHCVCargo

7.512.0tonne

54.5

38.8

35.6

40.7

38.9

12.016.2tonne

10.3

2.3

2.0

4.6

7.5

>16.2tonne

6.7

2.1

1.9

1.9

1.9

LCVPassenger

5.07.5tonne

7.1

7.8

7.8

10.7

14.4

LCVCargo

5.07.5tonne

13.8

11.8

10.1

14.3

13.4*

TotalMHCVs

79.7

7.6

8.4

9.4

10.7

TotalLCVs

20.3

2.0

1.8

2.1

2.2

TotalCVs

100

5.0

4.7

5.6

5.9

20.3

Source:SIAMNote:*Marketsharein3.5to7.5tonneGVWsegmentnotcomparablewithpreviousperiods

VECVholdsstrongmarketshareinthe7.5to12tonneGVWsegment,asthesevehiclesarepreferred
byfreightoperatorsonaccountoftheirlowercostofownership(includespurchasecost,runningcost
andresalevalue).TherunningcostofVECVsvehiclesislowerduetohigherfuelefficiencyandlower
maintenancecost.
Exhibit4: FreightoperatorsannualincomestforVECV,TTMT,ALvehiclesin12tonneGVWsegment
(INR)

VECV:Model11.1

TTMT:Model11.09

AL:Model1012

1,302,921

1,302,921

1,412,410

Fuelcost

355,726

415,014

452,742

Salary

240,000

240,000

240,000

Permit,roadtax,tolletc

240,000

240,000

240,000

84,659

87,734

88,984

382,536

320,174

390,684

Revenues

Otherexpenditure
EBITDA
EBITDAMargin(%)

29.4

24.6

27.7

Interest

65,556

62,976

64,584

Depreciation

57,094

54,844

56,250

Tax

85,762

66,777

89,050

PAT

174,124

135,577

180,800

PATMargin(%)

13.4

10.4

12.8

RoE(%)

34.3

27.8

34.0

1,015,000

975,000

1,062,000

Onroadprice(Mumbai)

Source:Industry,AvendusResearchNote:Basedonsamplesurveyoffreightoperators

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India Equity Research

EicherMotors

The same factor low cost of ownership is also driving higher acceptance of HCVs among freight
operators.
Freightoperator
profitabilityishigherfor
VECVtrucks.

Exhibit5: Freightoperatorsannualincomest.forVECV,TTMT,ALvehiclesin25tonneGVWsegment
(INR)
Revenues

VECV:Model30.25

TTMT:Model2518

AL:Model2516IL
1,831,947

1,658,880

1,726,787

Fuelcost

602,051

662,256

735,840

Salary

240,000

240,000

240,000

Permit,roadtax,tolletc

240,000

240,000

240,000

Otherexpenditure

196,425

214,050

212,300

EBITDA

380,404

370,481

403,807

22.9

21.5

22.0

Interest

88,152

102,108

99,840

Depreciation

76,781

88,931

86,963

Tax

71,105

59,216

71,611

PAT

144,366

120,226

145,393

EBITDAMargin(%)

PATMargin(%)

8.7

7.0

7.9

21.2

15.2

18.8

1,365,000

1,581,000

1,546,000

RoE(%)
Onroadprice(Mumbai)

Source:Industry,AvendusResearchNote:Basedonsamplesurveyoffreightoperators

VECV has gained market share of 1.9% in the HCV segment in 2011, and the company targets to
improvethisto15.0%by2015f.Toreachthistarget,thecompanyisexpandingcapacityandthedealer
networkinHCVs.
VECV is expanding its total annual CV production capacity from 48,000 vehicles in Sep11 to 60,000
vehiclesbyJun12.Thiscapacityislikelytobefurtheraugmentedto100,000vehiclesbyDec14.Mostof
theincrementalcapacityislikelytobeintheHCVsegment.
OutofVECVs220dealers,onlyapartofitsdealerssellHCVsforthecompany.Inanattempttoenable
moreofitsdealerstosellHCVs,thecompanyistraininguptofourdealerseachmonthtohandlesales
and service of HCVs. Expansion of the HCV dealer network is likely have a positive impact on the
segmentssalesvolumegrowth.
WeestimateaCAGRof10%inVECVsdomesticCVsalesvolumesover2012f2014f.

VECVJVstructureandholdingdetails
Thestructure,holdingandotherdetailsoftheJVformedinJul08wereasfollows:
TheJVcontainstheEIMsCVbusinessalongwithcomponentbusiness.
VOLVB acquired 45.6% stake in VECV for a consideration of USD350mnUSD275mn as cash and
USD75mnforitstrucks(exclusiverightsfordistributionofvehicles,sparesandservice)andbuses
(exclusive rights for service). VOLVBs trucks in India are largely in the more than 25 tonne GVW
HCVcategory.
VECVisjointlymanagedbyVOLVBandEIM,withequalrepresentationontheBoard.
VOLVBacquired8.1%stakeinEIMatINR691.7/share.Asaresult,VOLVBsindirectholdinginVECV
increasedto50%.

Outsourcingbusinesshashugepotential
VECVissettingupanengineplantwithcapacityof85,000unitsataninvestmentofcINR4bn.Thisplant
is likely to manufacture engines of up to EuroVI emission standards to meet VOLVBs global
requirements.Asignificantpart(c80%)oftheproductionwouldbeexportedtoVOLVB,whereasthe
remainingislikelytobeusedforVECVsHCVs.

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SourcingofenginesfromthisplantislikelytoreducetheenginecostforVOLVBsglobalbusiness.The
engineisthemostcriticalcomponentinaCVsuccessinthiscriticalengineprojectmayinduceVOLVB
toalsosourceotherlesscriticalautocomponentsfromVECV.
We have assumed production of 15,000 and 40,000 engines for 2013 and 2014, respectively. We
estimatetheenginebusinesstocontribute7%and6%ofEIMstotalincomeandEBITDA,respectively,
by2014f.

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Healthyorderbooklikelytosustainhighgrowthinmotorcycles
Thecompanyscruisermotorcyclescontinuetowitnessrobustdemand,despiteentryofnewmanufacturers.Thisison
accountofuniqueproductpositioning,whereincruisermotorcyclesareofferedatapricesignificantlybelowpeers.Due
to this advantage, EIM has been witnessing long waiting periods of 89 months for its motorcycles. To meet these
pendingorders,thecompanyissettingupanewplant.Inlightofthehealthyorderbookandcapacityexpansions,we
estimatedomesticsalesvolumegrowthof26%inmotorcyclesover2012f2014f.WeestimateEBITDAmarginsinthe
standalone business to increase from 12.1% in 2011 to 15.5% by 2014f, largely on account of positive operating
leverage.

Capacityexpansiontomeetdemand
EIMs Royal Enfield cruiser motorcycles used to dominate the above250cc category in motorcycles,
with100%marketshare.Themarketsharehasreducedduetoentryofplayers.Despiteentryofnew
players,thecompanycontinuestomaintainleadershippositionandreportsrobustgrowthduetothe
positioningofitsvehicles.
RoyalEnfieldcontinuesto
remainthemarketleader
inabove250cccategory
ofmotorcycles.

Exhibit6: Marketshareintheabove250cccategoryofmotorcycles(%)

RoyalEnfield
Others

2005

2006

2007

2008

2009

2010

2011

100.0

100.0

100.0

100.0

100.0

100.0

82.7

17.3

Source:SIAM

Thecompanyhasachieveduniqueproductpositioning,whereinitisabletooffercruisermotorcycles
atapricesignificantlybelowpeers.
Exhibit7: Pricecomparisonofcruisermotorcycles(INR)
Company

Models

RoyalEnfield

Bullet350UCE,Classic350,Classic500,Electra,Thunderbird

SuzukiMotorcycle IntruderM800,M1800R
India
IndiaYamaha
MT01,VMAX
Motor
HarleyDavidson Classic,CVO,FatBoy,Iron883,NightRod,Nightster,RoadKing,
MotorCompany StreetBob,StreetGlide,SuperGlide,SuperLow,UltraClassic
India
ElectraGlide,XL883RRoadster,XR1200X

Displacement(cc) Price(000)*
346499

100165

8051783

9701,458

1,6701,679

1,1942,282

8831803

6504,208

Source:IndustryNote:*OnroadpriceinMumbai

Asaresultofthispositioning,the company has beenwitnessingstrong demandfor itsvehicles. The

currentwaitingperiodstandsat89months.Inlightofthestrongdemandandhealthyorderbook,EIM
is setting up a new plant at an investment of cINR1.6bn. The company is also working on de
bottleneckingandexpandingcapacitiesatitsexistingplant.
The company is working on new models and variants. The launches of Thunderbird 500cc and Caf
RacerarelikelybyJun12andJun13,respectively.
WeestimateaCAGRof26% indomesticsalesvolumesover2012f2014f, basedonthestrongorder
bookandtheestimatedrampupinproductioncapacities.

EBITDAmarginslikelytosignificantlyimproveby2014f
RoyalEnfieldmotorcyclesareinthepremiummotorcyclecategory,whereplayerssuchasBJAUTderive
EBITDAmarginsinexcessof20%.EBITDAmarginsforEIMsmotorcyclebusinesshaveimprovedfrom
10.3%in2010to12.1%in2011.Thesemarginsarelikelytoimproveto15.5%by2014fasaresultof
positiveoperatingleverage.Also,costbenefitsarelikelytoaccruefrom2013fwiththecommissioning
ofthenewplant.

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India Equity Research

EBITDAmarginsto
improveto15.5%by
2014f,largelydueto
positiveoperating
leverage.

EicherMotors

Exhibit8: EstimatedtotalincomeandEBITDAgrowth(%)

2011

2012f

2013f

2014f

CAGR(2012f2014f)

Totalincomegrowth

51.6

11.5

28.5

36.1

24.9

EBITDAgrowth

76.9

16.3

47.9

45.8

35.8

Source:Company,AvendusResearch

Contributionofmotorcyclesbusinesstoprofitslikelytoincrease
Although the company is witnessing robust growth in CVs, the growth in motorcycles is likely to be
significantly higher over 2012f2014f. Due to the estimated strong growth and higher margins, the
contributionofthemotorcycle(standalone)businesstooverallEBITDAislikelytoincreasefrom22.5%
in2011to32.1%in2014f.
Exhibit9: ContributionofCVsandmotorcyclestototalincomeandEBITDA(%)

2011

2012f

2013f

2014f

ContributiontoTotalincome

VECV(CVs)

80.4

Standalone(Motorcycles)

19.6

81.3
18.7
ContributiontoEBITDA

79.4

76.6

20.6

23.4

VECV(CVs)

77.5

77.7

72.8

67.9

Standalone(Motorcycles)

22.5

22.3

27.2

32.1

Source:Company,AvendusResearch

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EicherMotors

Robusttotalincomegrowthof17%over2012f2014f
Total income is estimated to grow at a CAGR of 17% over 2012f2014f, largely on account of robust sales volume
growth.DomesticmotorcyclesalesvolumesarelikelytogrowataCAGRof26%,outpacingtheCAGRof10%inCVsales
volumes due to robust demand and a healthy order book. Robust total income growth is likely to lead to positive
operatingandfinancialleverage.EBITDAmarginsarelikelytoincreasefrom10.4%in2011to10.8%in2014f,largelyon
accountofpositiveoperatingleverage.Despitehigherdepreciationduetothelargecapex,PATisestimatedtogrowat
aCAGRof25%,outpacingEBITDAgrowth.

Strongsalesvolumegrowthinthestandalonebusiness,VECV
We estimate a CAGR of 10% in domestic CV sales volumes over 2012f2014f due to the growing
acceptanceofVECVsHCVsbyfreightoperators.
SalesvolumegrowthisestimatedtobehigherformotorcyclesincomparisontoCVs.Robustgrowthin
motorcyclesalesvolumesisonaccountofthehealthyorderbookandcapacityexpansion.Weestimate
domesticmotorcyclesalesvolumestogrowataCAGRof26%over2012f2014f.
Exhibit10: Estimatedsalesvolumeandtotalincomegrowth(%)
Salesvolumegrowthin
motorcyclesislikelytobe
higherthanCVsover
2012f2014f.

2011

2012f

VECV(CVs,Engines,etc)

2013f

2014f CAGRover2012f2014f

DomesticCVvolumes

45,935

50,529 55,581

61,139

10.0

ExportCVvolumes

3,108

3,263 3,753

4,316

11.6

TotalCVvolumes

49,043

53,792 59,334

65,455

10.1

Totalincome(INRmn)

50,451

59,901 68,117

78,542

15.9

Standalone(Motorcycles)
Domesticmotorcyclevolumes

71,756

80,708 104,830

142,950

25.8

Exportmotorcyclevolumes

3,563

4,293 5,170

7,050

25.5

Totalmotorcyclevolumes

75,319

85,000 110,000

150,000

25.8

Totalincome(INRmn)

6,710

7,483 9,615

13,081

24.9

67,384 77,732

91,624

Consolidated
Totalincome(INRmn)

57,160

17.0

Source:Company,SIAM,AvendusResearch

An increase in vehicle prices due to reduction of export incentives is unlikely to significantly impact
overall volumes in cargo CVs and motorcycles. EIMs focus on exports has been lower, as current
productioncapacityisbeingutilizedtomeetdomesticdemand.Thecompanyderived7.4%ofitssales
volumesfromexportsin2010,whichislowerthanthatforpeers.
We estimate consolidated total income to grow at a CAGR of 17% over 2012f2014f, on account of
robustsalesvolumegrowthinCVsandmotorcycles.

Costcutting,operatingleverageinmotorcyclesaidEBITDAmargins
EIMs EBITDA margin is increasing, mainly due to the rising margins in the standalone (motorcycle)
business.
Exhibit11: TrendinEBITDAmargins
(%)

2011

2012f

2013f

2014f

Standalonebusiness(motorcycles)

12.1

12.6

14.5

15.5

VECV

10.2

10.1

10.1

10.0

Overall

10.4

10.3

10.6

10.8

Source:Company,AvendusResearch

The EBITDA margin in the standalone business improved from 10.3% in 2010 to 12.1% in 2011. The
EBITDAmarginislikelytoincreaseto15.5%by2014fonaccountofpositiveoperatingleverage.The

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contributionofthestandalonebusinesstooverallEBITDAisestimatedtoincreasefrom22.5%in2011
to32.1%by2014f.
EBITDA is estimated to grow at a CAGR of 19% over 2012f2014f, outpacing growth in total income
(CAGRof17%)overthesameperiod.
EBITDAisestimatedto
outpacegrowthintotal
incomeover2012f2014f.

Exhibit12: EstimatedtotalincomeandEBITDA
2011

2012f

2013f

2014f

Totalincome

(INRmn)

57,160

67,384

77,732

91,624

CAGRover2012f2014f
17.0

EBITDA

5,935

6,970

8,258

9,908

18.6

Source:Company,AvendusResearch

PATgrowthlikelytomarginallyoutpaceEBITDAgrowth
Thecompanyisworkingonalargecapexplan(morethanINR10bnby2014),whichinvolvessettingup
of new engine, busbody and motorcycle plants and capacity expansion at the existing CV plant. On
accountofthesecapexplans,weestimatehigherdepreciation.Despitethis,PATisestimatedtogrow
ataCAGRof25%over2012f2014f,outpacingEBITDAgrowth(CAGRof19%).
Exhibit13: EstimatedEBITDAandPAT
2011

2012f

2013f

2014f

CAGRover2012f2014f

EBITDA

(INRmn)

5,935

6,970

8,258

9,908

18.6

PAT

3,088

3,941

4,807

6,092

25.4

Source:Company,AvendusResearch

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InitiatewithanAddratingandMar13pricetargetofINR1,918
EIM has outperformed the BSE Auto Index and the Nifty since announcement of the JV with VOLVB in Jul08. The
outperformancehas also beeninlinewithfundamentalssales volumes formotorcyclesand CVsgrewat a CAGRof
20.3%and25.8%,respectively,over20092011.WehaveusedtherelativevaluationmethodtovalueEIMsbusinesses.
We have valued EIMs standalone business and VECV stake at a 10% discount to the valuations of Hero MotoCorp
(HMCLIN,Hold)andAshokLeyland(ALIN,Buy),respectively.WehavetakenthemeanEV/EBITDAovertheprevious
cycleofthesecompaniesandprovidedadiscounttofactorinthedifferenceinbusinesssize.OurSOTPbasedMar13
targetforEIMstandsatINR1,918,whichprovidesa11%upside.InitiatewithanAddrating.Riskfactorsarehigherraw
materialcostsandfuelprices.

Strongoutperformanceinstockpriceduetorobustsalesgrowth
EIMhasoutperformedtheBSEAutoIndexandtheNiftybyahugemarginsinceannouncementofthe
JV with VOLVB. The outperformance has also been in line with fundamentalssales volumes for
motorcyclesandCVsgrewataCAGRof20.3%and25.8%,respectively,over20092011.
Theoutperformanceof
EIMvisvistheNiftyand
BSEAutoIndexwasdueto
robustsalesvolume
growthover20092011.

Exhibit14: EIMsstockperformanceincomparisonwiththeBSEAutoIndexandtheNifty(%)
(%)
EIM
BSEAutoIndex
Nifty

2008*

2009

2010

2011

13.6
33.6
31.7

178.8
204.2
75.8

88.5
37.6
17.9

20.5
20.4
24.6

Source:BloombergNote:*SinceannouncementofJVwithVOLVBinJul08

Exhibit15: EIMsstockperformanceincomparisontotheBSEAutoIndexandtheNifty
2,400
EIM

Niftyrebased

BSEAutorebased

1,800

1,200

600

0
Aug08

Dec08

Apr09

Aug09

Dec09

Apr10

Aug10

Dec10

Apr11

Aug11

Dec11

Source:Bloomberg

Usingrelativevaluationstovaluethestandalonebusiness,VECV
WehavevaluedEIMs
standalonebusiness
(motorcycles)at8x
EV/EBITDA.

WehavevaluedEIMsstandalonebusiness(motorcycles)at8.0xEV/EBITDA,whichisata10%discount
toHMCLspreviouscycles(Apr07Feb12)meanEV/EBITDAof8.8x.WeprovidethisdiscountasEIMis
smallerthanHMCLintermsofmotorcyclesalesvolumesandtotalincome.
Exhibit16: SizecomparisonbetweenHMCLandEIM
(FY11/2010)
HMCL
EIM*

Salesvolumes

Totalincome(INRmn)

5,402,444
52,574

194,012
4,427

Source:Company,SIAM,AvendusResearchNote:*YearendingDecember

However,EIMsestimatedgrowthinthestandalonebusiness(motorcycles)over2012f2014fishigher
thanthatofHMCLshistorical(FY08FY11)growthandtheestimatedgrowth(FY12fFY14f).

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Exhibit17: GrowthcomparisonbetweenHMCLandEIMsmotorcyclebusiness
(%)

Totalincomegrowth

EBITDAgrowth

EPSgrowth

18.3
13.7
17.0

22.2
13.7
18.6

23.7
13.6
25.4

HMCLCAGRoverFY08FY11
HMCLCAGRoverFY12fFY14f
EIMsstandalonebusinessCAGRover2012f2014f*

Source:Company,AvendusResearchNote:*YearendingDecember

Exhibit18: HMCLsoneyearforwardrollingEV/EBITDA
16
1yrFwdEV/EBITDA

AverageEV/EBITDA

13

10

4
Apr07

Mar08

Mar09

Mar10

Feb11

Feb12

Source:Bloomberg,AvendusResearch

WehavevaluedVECVat
7.7xEV/EBITDA.

We have valued VECV at 7.7x EV/EBITDA, which is at 10% discount to ALs previous cycles (Apr07
Feb12)meanEV/EBITDAof8.6x.Weprovidethisdiscounttofactorinthedifferenceinsize.
Exhibit19: SizecomparisonbetweenALandVECV
(FY11/2010)

Salesvolumes

Totalincome(INRmn)

94,104
39,508

111,177
39,786

AL
VECV*

Source:SIAM,Bloomberg,AvendusResearchNote:*YearendingDecember

In terms of growth, VECVs estimated growth over 2012f2014f is higher than that of ALs historical
(FY08FY11)growthandestimated(FY12fFY14f)growth.
Exhibit20: GrowthcomparisonbetweenALandVECV
(%)
ALCAGRoverFY08FY11
ALCAGRoverFY12fFY14f
VECVCAGRover2012f2014f

Totalincomegrowth

EBITDAgrowth

EPSgrowth

11.6
13.2
15.9

14.7
9.2
15.4

11.2
8.9
16.7

Source:Company,AvendusResearch

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Exhibit21: ALsoneyearforwardrollingEV/EBITDA
20
1yrFwdEV/EBITDA

AverageEV/EBITDA

15

10

5
Apr07

Mar08

Mar09

Feb10

Feb11

Feb12

Source:Bloomberg,AvendusResearch

ApplyingtheEV/EBITDAmultiplesof8.0xand7.7xtothestandalonebusinessandVECV,respectively,
wearriveatourMar13SOTPbasedtargetpriceofINR1,918.Thepotentialupsidestandsat11%.We
initiatecoveragewithanAddrating.
Initiatecoveragewithan
AddratingwithaMar13
TPofINR1,918.

Exhibit22: SOTPvaluation
(INRmn)
Standalonebusiness
VECV*
Enginebusiness*
Total
Persharevalue(INR)

BasisofValuation(x)

Enterprisevalue

Netdebt

Equityvalue

8.0xEV/EBITDA
7.7xEV/EBITDA
Bookvalue

12,436
28,393

6,493
2,234

18,929
30,627
2,176
51,732
1,918

Source:AvendusResearchNote:*ProportionateshareofEIMconsidered

AtourMar13TP,thestocktradesatanEV/EBITDAof8.2x.
Exhibit23: OneyearforwardrollingEV/EBITDAandEV/EBITDAattargetprice
20
1yrFwdEV/EBITDA

TargetEV/EBITDA

AverageEV/EBITDA

10

10
Apr07

Feb08

Dec08

Oct09

Sep10

Jul11

May12

Mar13

Source:Bloomberg,AvendusResearch

Riskfactors
Rise in raw material prices: We have assumed stable raw material cost per vehicle over 2012f
2014f.Ifpricesofsteel,aluminumandrubberincrease,thenthecompanysmarginsanddemand
arelikelytobeadverselyaffected.
Riseinfuelprices:AnyincreaseinfuelpricesislikelytoleadtopostponementofCVpurchasesby
freightoperators,asitnegativelyimpactstheirmargins.

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Exhibit24: SensitivityanalysisImpactonconsolidatedearningsonaccountof1%declinein:
(%)

2012f

2013f

2014f

CVsalesvolumes

0.9

0.8

0.7

BlendedrealizationsforCVs

6.1

5.6

4.9

5.1

4.6

4.0

RawmaterialcostpervehicleforCVs
Source:AvendusResearch

Note:Sensitivityanalysishasnotbeencarriedoutformotorcycles,asthestrongorderbookprovidespricingpowerand
visibilityinsalesvolumes.

Exhibit25: RelativevaluationsasonFebruary22,2012

AL

CMP Rating TargetPrice Upside PriceChange(%)

P/E
EV/E ROCE(%) ROE(%)
(INR)

(INR)
(%)
1m
3m
6m 2012f/ 2013f/ 2014f/ 2012f/ 2013f/ 2014f/
2012f/ 2012f/
FY12f FY13f FY14f FY12f FY13f FY14f
FY12f
FY12f
28

Buy

41

46

5.4

13.1

11.3

12.8

10.7

9.2

8.9

7.8

6.8

10.2

14.3

EIM*

1724

Add

1918

11

6.9

7.8

27.1

11.9

9.7

7.7

9.5

7.4

5.4

21.5

24.0

TTMT

268

Add

303

13

22.5

55.7

82.1

8.3

7.9

7.0

4.8

4.3

3.7

21.3

45.6

Source:Bloomberg,AvendusResearchNote:*YearendingDecember,ProportionateshareofEIMinVECVconsideredforratios

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Financialsandvaluations(consolidated)
Incomestatement(INRmn)
Fiscal yearending
Gr osssal es
Less:Exciseduty
Netsal es
Ot her oper ati ngincome
Totaloperatinginco me
Totaloperatingexpenses
Netmateri als
Ot her directcosts
Personnel
SG&A
R&D
EBITDA
Ot her income
Depreciat ion
EBIT
Interest
Recurr ingPB T
Netextraordinaryitems
PBT(reported)
Totaltaxes
PAT(reported)
Add:Shareo f earningsofassociat e
Less:Minorityi nterest
Pri orperiod items
Netincome(reported)
Avendusnetincome
Divi dend +Distributiontax
Sh aresoutstanding(mn)
Avendus dilutedshar es(mn)
AvendusEPS (INR )

12/ 10
47,016
3,046
43,971
242
44,213
40,402
33,147
1,504
2,631
2,851
269
3,811
1,034
573
4,272
95
4,177
0
4,177
1,108
3,069
0
1,179
0
1,889
1,889

12/11
61,234
4,459
56,775
385
57,160
51,225
41,818
1,784
3,461
3,749
413
5,935
1,383
640
6,679
77
6,602
0
6,602
1,628
4,974
0
1,886
0
3,088
3,088

12/12f
72,280
5,263
67,017
367
67,384
60,414
48,932
2,244
4,003
4,716
519
6,970
2,111
957
8,124
54
8,070
0
8,070
1,972
6,098
0
2,157
0
3,941
3,941

12/13f
83,408
6,073
77,335
397
77,732
69,474
56,513
2,451
4,791
5,151
567
8,258
2,644
1,199
9,703
54
9,649
0
9,649
2,332
7,318
0
2,511
0
4,807
4,807

12/14f
98,341
7,161
91,180
443
91,624
81,715
66,543
2,828
5,749
5,942
654
9,908
3,320
1,244
11,984
54
11,930
0
11,930
2,841
9,090
0
2,997
0
6,092
6,092

346

503

638

845

1,174

27
27
70

27
27
114

27
27
145

27
27
177

27
27
225

49.5
137.2
118.0
123.0
126.5
126.5

29.3
55.7
56.3
58.1
63.4
63.4

17.9
17.4
21.6
22.2
27.6
27.6

15.4
18.5
19.4
19.6
22.0
22.0

17.9
20.0
23.5
23.6
26.8
26.8

Growthratios(%)
Totaloperat ingi ncome
EBITDA
EBIT
Recurr ingPB T
Avendus net income
Avendus EPS

Operatingratios(%)
EBITDA margi n
EBITmargin
Netprofitmargin
Ot her income/PBT
Effective Taxrate

8.6
9.7
4.2
24.8
26.5

10.4
11.7
5.3
20.9
24.7

10.3
12.1
5.7
26.2
24.4

10.6
12.5
6.0
27.4
24.2

10.8
13.1
6.4
27.8
23.8

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Balancesheet(INRmn)
Fiscal yearending
Equity capital
Preferencecapital
Reserves andsurpl us
Net worth
Mino rity interest
Totaldebt
Deferredtax liability
Totalliabilities
Gr ossblock
less:Accumulateddepreciati on
Netblock
CW IP
Goodwill
Investments
Cash
Inventories
Debtors
Loans andadvances
less:Cur rentliabilities
less:Prov isions
Network ingcapital
Totalasset s

12/ 10
269
0
12,018
12,287
6,774
956
249
20,267
8,113
4,269
3,844
669
0
4,586
12,457
3,265
2,609
2,169
7,942
1,391
11,168
20,267

12/11
270
0
14,480
14,750
8,377
504
645
24,275
13,025
4,909
8,116
875
0
5,126
11,973
4,280
3,434
3,814
11,846
1,497
10,157
24,275

12/12f
270
0
17,783
18,053
10,533
504
645
29,734
17,893
5,866
12,027
998
0
5,126
13,583
4,300
3,543
3,886
12,097
1,632
11,583
29,734

12/13f
270
0
21,745
22,015
13,044
504
645
36,207
20,385
7,065
13,319
373
0
5,126
19,699
4,370
3,661
3,955
12,459
1,839
17,389
36,207

12/14f
270
0
26,663
26,933
16,042
504
645
44,123
21,958
8,310
13,648
300
0
5,126
27,736
4,745
3,833
4,076
13,174
2,168
25,049
44,123

12/ 10
1,889
573
0
726
1,034
2,154
1,222
0
1,644
0
0
1,034
1,833
0
307
346
1,094
441
762

12/11
3,088
640
0
527
1,383
2,871
5,118
0
540
0
0
1,383
4,275
0
453
503
2,160
1,204
200

12/12f
3,941
957
0
185
2,111
2,972
4,992
0
0
0
0
2,111
2,880
0
0
638
2,157
1,519
1,610

12/13f
4,807
1,199
0
311
2,644
3,672
1,867
0
0
0
0
2,644
777
0
0
845
2,511
1,666
6,116

12/14f
6,092
1,244
0
377
3,320
4,393
1,500
0
0
0
0
3,320
1,820
0
0
1,174
2,997
1,823
8,037

Cashflowstatement(INRmn)
Fiscal yearending
Netprofit
Depreciat ion
Deferredtax
W orkingcapital changes
Less:Otheri ncome
Cashflowfromoperations
Capitalexpendi ture
St rat egicinvestmentspur chased
Marketableinvestmentspurchased
Changeinot herloansandadvances
Goodwill paid
Ot her income
Cashflowfrominvesting
Equity raised
Changeinborrowings
Divi dendspaid(incl.tax)
Ot her s
Cashflowfromfinancing
Net change incash

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KeyRatios
Fiscalyearending
Valuationratios(x)
P/E (onAvendusEPS)
P/E (onbasic,reportedEPS)
P/CEPS
P/BV
Dividend yield(%)
Mark et cap./ FCF
Mark et cap./ Sal es
EV/Sales
EV/EBITDA
EV/FCF
EV/TotalAssets
NetCash/ Marketcap.
Per shareratios(INR)
AvendusEPS
EPS(Basic,reported)
Cash EPS
BookValue
Dividend pershare
RO E Decomposition(%)
EBITmargin
Assetturnover(x)
Interestexpenserat io
Tax reten tionratio
RO A
Totalassets /equit y(x)
RO E
Retu rnratios(%)
EBIT/CapitalEmployed
RO CE
RO IC
FC F/IC
OCF/Sal es
FC F/Sal es
Turnoverratios(x)
Grossturnover
Netturnover
Revenue/IC
Inventory / Sal es(days)
Receivables(days)
Payables(days)
W orkingcapital cycle(excash)(day s)
Solvencyratios(x)
Grossdebtto equit y
Netdebtto equi ty
Netdebtto EBITDA
InterestCo verage(EBIT/ Interest)

12/10

12/11

12/12f

12/13f

12/14f

24.8
24.6
18.8
3.8
0.6
49.9
1.1
1.5
17.3
101.0
3.0
36.6

15.2
15.1
12.6
3.2
0.9
20.7
0.8
1.2
11.2
159.8
2.5
36.7

11.9
11.8
9.6
2.6
1.2
23.0
0.7
1.0
9.5
998.8
2.1
40.1

9.7
9.7
7.8
2.1
1.6
25.8
0.6
0.8
7.4
14.7
1.6
53.3

7.7
7.6
6.4
1.7
2.2
16.1
0.5
0.6
5.4
9.3
1.2
70.5

69.6
70.1
91.6
456.1
11.0

113.8
114.5
137.4
546.5
16.0

145.3
146.0
180.5
668.9
20.3

177.2
178.1
221.3
815.7
26.8

224.5
225.7
270.4
997.9
37.3

10.5
2.1
0.5
75.5
16.2
1.1
17.4

13.2
2.3
0.4
78.4
24.1
1.1
25.9

12.9
2.3
0.2
77.0
22.5
1.1
24.0

13.4
2.2
0.2
77.4
22.7
1.1
24.0

14.1
2.2
0.1
77.9
23.8
1.0
24.9

22.4
15.6
68.8
32.7
4.9
2.1

30.0
21.5
70.5
50.4
5.0
3.9

30.1
22.7
48.6
24.6
4.4
3.0

29.4
22.9
45.9
17.1
4.7
2.3

29.8
23.9
55.7
26.3
4.8
3.2

5.4
11.5
15.5
22.4
19.1
79.0
11.4

4.4
7.0
12.8
23.7
17.8
86.5
13.1

3.8
5.6
8.2
23.2
17.5
89.8
13.8

3.8
5.8
7.4
20.2
15.5
79.5
13.8

4.2
6.7
8.3
18.0
13.6
69.9
13.7

0.4
0.6
3.1
43.1

0.4
0.4
1.8
88.6

0.4
0.3
1.5
145.5

0.4
0.4
1.7
176.4

0.3
0.5
1.9
222.0

Note:ProportionateshareofEIMinVECVJVconsideredforcalculationofratios

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AnalystCertification
Thefollowinganalyst(s)is(are)primarilyresponsibleforthisreportand,certifies(y)thattheopinion(s)onthesubjectcompany(ies)anditssecurity(ies)andanyotherviewsor
forecastsexpressedhereinaccuratelyreflecttheirpersonalview(s).Theyfurthercertifythatnopartoftheircompensationwas,isorwillbedirectlyorindirectlyrelatedtothe
specificrecommendation(s)orviewscontainedinthisresearchreport:SriRaghunandhanNL

Disclosures
MeaningofAvendusSecuritiesPrivateLimitedsequityresearchratings
Theratingrepresentstheexpectedchangeinthepriceofthestockoverahorizonof12months.
Buy:morethan+20%

Add:+10%to+20%

Hold:10%to+10%

Reduce:10%to20%

Sell:lessthan20%

Proportionofratingsineachcategoryandinvestmentbankingrelationships
AttheendofDecember2011

Buy

Add

Hold Reduce

Sell

NR

Total

Proportionofratingsineachcategory

32%

24%

29%

7%

0%

7%

100%

0%

13%

5%

0%

0%

20%

6%

Proportionofcompaniestowhommaterialinvestmentbankingserviceswereofferedduringtheprevious12months

Analystdisclosures
None of the analysts involved in the preparation of this research report or a member of his/her household is an officer, director or supervisory board member of any of the
company(ies)thatis/arethesubjectofthisresearchreport.Noneoftheanalystsinvolvedinthepreparationofthisresearchreportormembersofhis/herhouseholdholdany
financialinterestinthesecuritiesofthecompany(ies)thatis/arethesubjectofthisresearchreport.Noneoftheanalystsinvolvedinthepreparationofthisresearchreporthave
receivedorpurchasedsharesofthesubjectcompanypriortothepublicofferingofthoseshares

DisclosuresonpotentialconflictsofinterestforAvendusSecuritiesPrivateLimitedand/oritsassociatecompanies(Avendus)asonFebruary21,2012
Asontheabovementioneddate,theshareholdingsofAvendusdoesnotexceed5%ofthetotalissuedsharecapitalofEicherMotorsLimited(EIM).Avendusdoesnotholdany
otherfinancialinterestinEIMthatissignificantwithregardtotheresearchrecommendation.Asontheabovementioneddate,theshareholdingsofEIMdoesnotexceed5%ofthe
totalissuedsharecapitalofAvendus.Avendusisnotamarketmakerorliquidityproviderinthesecuritiesoftherelevantissuerorinanyrelatedderivatives.Avendushasnotbeen
aleadmanagerorcoleadmanagerofapubliclydisclosedofferofsecuritiesofEIMorinanyrelatedderivativesoverthepast12months.Overthepast12months,Avendushas
not been party to an agreement with EIM with regard to the provision of other investment banking services that do not entail the disclosure of any confidential commercial
information.Avendusisnotpartytoanagreementwiththesubjectcompany(ies)ofthisresearchreportwithregardtotheproductionofthisresearchreport.

Sharepricehistoryandratingchanges

2,000
EIM(InitiatedonFeb23,12)

Rating,Date,TP(INR)
Add,23Feb12,1918

1,600

1,200

800
Feb11

Apr11

Jun11

Jul11

Sep11

Nov11

Dec11

Feb12

Automobiles

19

India Equity Research

EicherMotors

Disclaimer
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20