Ambit Strategy Thematic TenBaggers5 05jan2016

Strategy
THEMATIC
January 05, 2016
Ten Baggers 5.0
Exhibit A: Ten baggers 5.0
Over the past four years we have used our greatness framework to
identify structurally strong businesses in India. These companies were
identified based on their relentless improvement in financial
performance over long periods (usually, six years). Using FY15 annual
reports, we now refresh our annual list of ten baggers. The first four
iterations (for FY11 to FY14) have cumulatively delivered ~26% CAGR
returns (over the past four years) vs BSE500 CAGR return of 14%. The
sub-BSE500 tenbaggers list has delivered ~55% CAGR returns over the
last three years.
Our relentless focus on franchises that keep improving
Whilst Good & Clean remains our preferred tactical way of playing Indian
equities (click here for the 2nd September G&C portfolio), in a country like India
the robustness of the economy ensures that well-managed companies that are
focused on building cash-generative franchises have a high chance of doing
well. Structural plays, like the ones we aim to identify in our ten-bagger
portfolios, are financially strong firms (with credible management teams) that
remain consistent performers on a cross-cyclical basis. Both in live portfolios and
back-tests, the approach delivers impressive alpha in most years whilst investing
in high-quality franchises.
A back-test of the greatness framework has yielded impressive returns
1,000
20.1% CAGR
800
600
15.1% CAGR
400
13.6% CAGR
200
Greatness
model
Universe
(average
basis)
BSE500
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-09
Jan-08
Jan-07
Jan-06
Jan-05
Jan-04
Source: Ambit Capital research. Note: The backtest is based on annual rebalancing with forward-looking
returns being calculated from December 31 of year X to December 31 of year X+1; for example, for the
most recent year, the framework included numbers until FY14 and returns have been calculated from 31
December 2014 to 31 December 2015.
The greatness philosophy worksyear after year

Consistent improvements in corporate performance are more important than
great leapsthis has been the guiding philosophy of our greatness
framework, which lies at the core of our process of identifying structurally sound
businesses. Not only do the great firms perform significantly better than an
average firm on a variety of measures, more importantly, they show a more
consistent and calibrated approach to growth over long periods. In this note, we
update our greatness framework to include FY15 numbers.
As shown over the past four years, our framework uses the following attributes
to measure consistent financial improvements: judicious capex, conversion of
capex to sales, pricing discipline, balance sheet discipline, cash generation and
net profit improvement, and return ratio improvement.
This years portfolio
We find that 80 firms from the BSE500 pass more than two-thirds of the tests in
our greatness framework. Of these, the best 30 firms that clear our accounting
quality and corporate governance filters make it to this years list. Of these 30
firms, we have bottom-up coverage with BUYs on: ITC, PI Industries, HCL Tech,
Page Industries, Finolex Cables, TCS, Tata Motors, Supreme Industries, Berger
Paints, TVS Motors, HUL and Marico. 70% of the stocks in this years portfolio
also featured in last years portfolio implying 30% churn.
Ticker
Company
Mcap
(US$ mn)
Attractive valuations*
ITC IN
ITC
IDEA IN
Idea Cellular
HCLT IN
HCL Tech.
TCS IN
TCS
GPPV IN
Gujarat Pipavav#
MRF IN
MRF
TTMT IN
Tata Motors
Moderate valuations**
TRP IN
Torrent Pharma
Rich valuations***
LPC IN
Lupin Ltd.
PSYS IN
Persistent Systems+
KJC IN
Kajaria
BRIT IN
Britannia+
SKB IN
GSKConsumer+
PI IN
PI Industries
MTCL IN
Mindtree+
PAG IN
Page Industries
FNXC IN
Finolex Cables
SI IN
Supreme Inds
BRGR IN
Berger Paints
EIM IN
Eicher Motors+
TVSL IN
TVS Motor
SF IN
Sundram Fasteners
AJP IN
Ajanta Pharma#
Hatsun
HTSMF IN
Agro#
LOG IN
La Opala#
HUVR IN
HUL#
VO IN
Vinati Organics#
MRCO IN Marico#
AIAE IN
AIA Engg#+
ATLP IN
Atul Ltd.#
39,216
7,328
17,856
70,083
1,142
2,579
18,462
3,679
12,139
777
1,175
5,353
4,101
1,350
1,826
2,270
576
1,314
2,742
7,131
2,046
520
1,753
676
514
27,900
360
4,363
1,254
756
Source: Ambit Capital research

* Trading below five-year P/E, P/B, EV/EBITDA
(on at least two of these three measures)
** Trading below either five-year P/E, five-year P/B
or five-year EV/EBITDA (on one of these three
measures)
*** Trading above five-year P/E, P/B, EV/EBITDA
# denotes new entrant to our ten baggers
portfolio
+ Indicates that the Ambit sector lead has a
bottom-up SELL on the name
Analyst Details
Gaurav Mehta, CFA
+91 22 3043 3255
gauravmehta@ambitcapital.com
Prashant Mittal, CFA
+91 22 3043 3218
prashantmittal@ambitcapital.com
Saurabh Mukherjea, CFA
+91 22 3043 3174
saurabhmukherjea@ambitcapital.com
Ambit Capital and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, investors should be aware that Ambit Capital
may have a conflict of interest that could affect the objectivity of this report. Investors should not consider this report as the only factor in making their investment decision.
Strategy
CONTENTS
Philosophy and framework. 3
Quantifying greatness. 5
Does this approach work?........................................................................................ 6
Ten baggers 5.0... 8
Greatness framework on sub-BSE500 firms.12
Performance check: Jan 2015 ten-bagger list.... 13
Performance check: Jan 2015s sub-BSE500 firms. 14
Valuations - A long-term perspective!..................................................................... 15
Appendix January 2016 ten-baggers business activity description.17
January 05, 2016
Ambit Capital Pvt. Ltd.
Page 2
Strategy
Philosophy and framework

Greatness is not in where we stand, but in what direction we are moving.
- Oliver Wendell Holmes
This quote appropriately captures the driving philosophy behind our greatness
framework that lies at the core of our process of identifying potential ten baggers. We
had unveiled this framework on 19 January 2012 with the first iteration of the
Tomorrows ten baggers note. This framework studies a firms structural strengths by
focusing not on absolutes but rather on improvements over a period of time and the
consistency of those improvements.
A basic sketch of the underlying process behind the making of a great firm has been
recaptured in Exhibit 1 below.
Exhibit 1: The greatness framework
a. Investment (gross
block)
b.
Conversion
of
investment to sales
(asset turnover, sales)
c.
Pricing
discipline
(PBIT margin)
e. Cash generation
(CFO)
d.
Balance
sheet
discipline (D/E, cash
ratio)
We rank the BSE500 universe of firms (excluding financial services firms and
excluding firms with insufficient data) on our greatness score, which consists of six
equally weighted headingsinvestments, conversion to sales, pricing discipline,
balance sheet discipline, cash generation and EPS improvement, and return ratio
improvement.
Under each of these six headings, we further look at two kinds of improvements:
Percentage improvements in performance over FY13-15 vs FY10-12; and
Consistency in performance over FY10-15 i.e. improvements adjusted for

underlying volatility in financial data
A complete list of factors that are considered whilst quantifying greatness has been
provided in Exhibit 2 on the next page.
January 05, 2016
The greatness framework

The framework essentially
hinges on using publicly
available historical data to
assess which firms have, over
a sustained period of time
(FY10-15), been able to
relentlessly and consistently:
(a) Invest capital;
(b) Turn investment into
sales;
(c) Turn sales into profit;
(d) Turn
profit
into
balance sheet strength;
(e) Turn all of that into
free cash flow; and
(f) Invest free cash flows
again.
Clearly, this approach will

have limited value if there is a
structural break in the sector
or in the company, which
makes past performance a
meaningless guide to future
performance. (For identifying
structural breaks of this sort,
for example in the Indian
boiler-turbine-generator
sector or in the Indian utilities
sector, we look to our sector
leads for help.)
However, to the extent that

such structural breaks tend to
be the exception than the
rule, the greatness model
helps in creating a shortlist of
stocks that investors can then
analyse in greater detail.
Put simply, the greatness
model separates the wheat
from the chaff. Yet, it does not
cook the whole meal for you!
Page 3
Strategy
Exhibit 2: Factors used for quantifying greatness
Head
Criteria
Investments
a.
Above median gross block increase (FY13-15 over FY10-12)*
b.
Above median gross block increase to standard deviation
Conversion to sales
a.
b.
Improvement in asset turnover (FY13-15 over FY10-12)*

Positive improvement in asset turnover adjusted for standard
deviation
Pricing discipline
Balance sheet discipline
Cash generation and

PAT improvement
6 Return ratio improvement
c.
Above median sales increase (FY13-15 over FY10-12)*
d.
Above median sales increase to standard deviation
a.
Above median PBIT margin increase (FY13-15 over FY10-12)*
b.
Above median PBIT margin increase to standard deviation
a.
Below median debt-equity decline (FY13-15 over FY10-12)*
b.
Below median debt-equity decline to standard deviation
c.
Above median cash ratio increase (FY13-15 over FY10-12)*
d.
Above median cash ratio increase to standard deviation
a.
Above median CFO increase (FY13-15 over FY10-12)*
b.
Above median CFO increase to standard deviation
c.
Above median adj. PAT increase (FY13-15 over FY10-12)*
d.
Above median adj. PAT increase to standard deviation
a.
Improvement in RoE (FY13-15 over FY10-12)*
b.
Positive improvement in RoE adjusted for standard deviation
c.
Improvement in RoCE (FY13-15 over FY10-12)*
d.
Positive improvement in RoCE adjusted for standard deviation
Both improvement and the

consistency of those
improvements are important
Source: Ambit Capital research. Note: * Rather than comparing one annual endpoint to another annual endpoint
(say, FY10 to FY15), we prefer to average the data out over FY10- 12 and compare that to the averaged data
from FY13-15. This gives a more consistent picture of performance (as opposed to simply comparing FY10 to
FY15).
We rank the BSE500 universe of firms (excluding financial services firms) on this score
to arrive at this years rankings on this measure of structural strength. After removing
financial services firms and firms with insufficient data, 399 firms from the BSE500
were ranked based on this measure. The highlights from the distribution of these
firms on our greatness score are displayed on the next page.
On page 6, we show a back-test of this framework over FY04-2015 and find that it
works on a consistent basis. On pages 14-15, we show the real world performance of
these sets of portfolios over the last year and demonstrate that the construct works in
the real world as well. The lists from the BSE500 universe have cumulatively delivered
~26% CAGR returns (over the past four years) vs 14% CAGR returns for the BSE500
Index. The lists from the sub-BSE500 universe that we had published in our previous
three iterations have cumulatively delivered ~55% CAGR returns (over the past three
years) vs ~17% CAGR returns for the BSE Small-cap Index.
On pages 8-12, we delve into this years list of 30 firms that constitute our ten
baggers 5.0. This is followed by a list of 10 firms from the sub-BSE500 universe that
do well on the same framework.
January 05, 2016
Page 4
Strategy
Quantifying greatness
From the universe of BSE500 firms, after removing financial services firms and firms
with insufficient data, 399 firms were scored on the six headings highlighted on the
previous page. The cut-off for greatness was placed at 67%* and only 80 firms (20%
of the total population of 399 firms) could manage a score above this cut-off.
Exhibit 3: Distribution of firms on the greatness score (total population: 399 firms)
Thus, each of these six

factors carries a weightage
of 16.7%. The scoring on
sub-criteria within each of
these factors is binary, with
a firm getting either 1 or 0
based on whether it has
done better than the
respective threshold or not.
90%-100%
80%-90%
Only 80 firms
score >67%
70%-80%
87 firms
(between 50%
and 67%)
60%-70%
Zone of greatness
50%-60%
Good, not Great
40%-50%
20%-30%
10%-20%
30%-40%
232 firms
score < 50%
90.0
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
0%-10%
No. of firms
Zone of mediocrity
*The greatness score is

calculated by assigning
equal weightages to the six
factors outlined in Exhibit 2
on page 4.
In the next exhibit, we present key financial data on the three zones defined above:
Mediocrity (232 firms), Good but not great (87 firms), and Great (80 firms).
These scores are then

cumulated to arrive at a
final greatness score on 100
for the firm.
Exhibit 4: Zones of greatness - Financial summary

Mediocre
Good but not great
Great
Number of firms
232
87
80
Mcap (US$ mn)*
636
852
1,148
9%
26%
45%
11%
11%
16%
7%
15%
19%
-3%
17%
29%
Share price (3-year CAGR)#

Gross block (3-year CAGR)
Sales (3-year CAGR)
Adj PAT (3-year CAGR)
CFO (3-year CAGR)
PBIT Margin (3-year average)
RoE (3-year average)
4%
17%
32%
10%
14%
15%
9%
18%
24%
RoCE (3-year average)
11%
19%
25%
Net debt: equity
0.31
0.13
0.31
FY16 P/E
22.8
24.2
21.3
FY16 P/B
2.3
4.1
4.5
Source: Capitaline, Ambit Capital research; Note: All figures are based on median values of the firms analysed
*Mcap as of 4 January 2016. # indicates share price performance from 04 January 2013 to 04 January 2016.
With regard to fundamentals, the superiority of the great firms compared with the
other two groups is evident in Exhibit 4 above. Of these 80 great firms, we identify
the ones that perform the best on our accounting and corporate governance filters,
and this leads to our final list of 30 great companies. Before we move onto these 30
potential ten baggers, we shall discuss a back-test of the greatness framework in the
next section to see whether great firms have indeed managed to deliver superior
returns historically.
January 05, 2016
Page 5
Strategy
Does this approach work?

The greatness approach has served us well in live portfolios, both in the ten-baggers
format and as a tool for stock selection in the Good & Clean portfolios. That this
approach works on a cross-cyclical basis is supported by a back-test of the
framework.
Our back-test of the greatness framework in India, going back to 2003 (which
implies using data since 1997-98), shows that great firms have historically delivered
superior results. Using average returns as a measure to gauge the performance of
great firms, we note that they have managed to outperform the universe by 5.0%
(on average returns) and the BSE500 Index by 6.5% (in CAGR terms; over a 12-year
period from 2004 to 2015).
Great firms are firms that score more than 67% on our framework. We rebalance
these buckets once a year (on 31 December), taking into account the preceding six
years of financial data (FY10-15 in the case of ten baggers 5.0). The performance
over the subsequent year is measured on a calendar year basis.
Exhibit 5: Average performance of Great firms vs the Universe and BSE500 Index
(2004-2015)
1,000
20.1% CAGR
800
600
15.1% CAGR
400
13.6% CAGR
Greatness
model
Universe
(average
basis)
BSE500
Between 2004-15, Great firms

have outperformed the universe
by 5.0% points per annum (on
average returns) and the BSE500
Index by 6.5% points per annum
200
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-09
Jan-08
Jan-07
Jan-06
Jan-05
Jan-04
Source: Ambit Capital research; Note: The backtest is based on annual rebalancing with forward-looking returns
being calculated from December 31 of year X to December 31 of year X+1; for example, for the most recent
year, the framework included numbers until FY14 and returns have been calculated from 31 December 2014 to
31 December 2015.
Outperformance was also seen on a median basis. A median firm in the universe has
delivered 5.0% CAGR returns (over 2004-2015). In contrast, a median great firm
has managed to deliver 9.1% CAGR returns, thus resulting in an outperformance of
~4.1% (on a CAGR basis) for great firms vs. the universe.
Exhibit 6: Median performance of Great firms vs the Universe (2004-2015)
350
300
250
200
150
9.1% CAGR
Greatness
model
5.0% CAGR
Universe
(median
basis)
100
Outperformance was also seen

on a median basis
50
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-09
Jan-08
Jan-07
Jan-06
Jan-05
Jan-04
Source: Ambit Capital research; Note: The backtest is based on annual rebalancing with forward-looking returns
being calculated from December 31 of year X to December 31 of year X+1; for example, for the most recent
year, the framework included numbers until FY14 and returns have been calculated from 31 December 2014 to
31 December 2015.
January 05, 2016
Page 6
Strategy
Note that this back-test does not consider accounting or management quality, which
we believe are factors that should improve the performance of our live portfolios.
Thats what the next section of this note focuses on.
Before we delve into this years list of 30 firms that constitute our ten baggers 5.0, the
following two exhibits show the performance of the live ten-baggers portfolio since
January 2012 when we first unveiled this framework. Whilst the BSE500 ten baggers
have managed to outperform the BSE500 Index by ~53% points (on a cumulative
basis) over the last four years, the ten baggers from the sub-BSE500 universe that we
highlighted in the previous three iterations have managed to outperform the BSE
Small-cap Index by a whopping 115% points (on a cumulative basis).
Outperformance for all our live ten-baggers from the BSE500 and the sub-BSE500
universe demonstrates that the construct works in the real world as well.
Exhibit 7: Performance of the BSE500 ten-bagger portfolios (since 19 January 2012)
80
70
52.6
Return (%)
60
43.4
50
40
30
20
6.7
9.8
2012
2013
10
The live performance of our tenbagger portfolios has been

impressive too
(10)
Tenbagger iteration return
2014
index return
2015
cumulative alpha
Source: Bloomberg, Ambit Capital research
Exhibit 8: Performance of the sub-BSE500 ten-bagger portfolios (since 14 January

2013)
150
115.2
91.9
Return (%)
100
50
41.4
2013
2014
2015
(50)
Small-caps tenbagger iteration return
BSE Smallcap index return
cumulative alpha
January 05, 2016
Page 7
Strategy
Ten baggers 5.0

In the latest iteration of the ten-bagger exercise, from the 80 firms that clear more
than two-thirds of our cut-off, we reach a shortlist of 30 firms after following a
process of elimination. This involves removing firms:
That fall in the Zone of Trouble in our accounting model (i.e. the bottom 4
deciles on accounting quality; for a full exposition of our accounting filter, please
refer to our 17th December 2015 note);
Firms with suspect corporate governance; and
Firms with structural issues around the underlying business (i.e. businesses where
a great past is not likely to translate into a great future).
An overlay of accounting,
corporate governance and
subjective checks to the greatness
framework is the last but critical
step
Note that the accounting filter mentioned in the first bullet eliminates 19 out of the
80 firms on the long list. Of remaining 61 firms, 31 are eliminated by the second and
third bullets.
There are 9 changes (implying 30% churn) with respect to last years list (refer to our
5th January 2015 note). A summary of these changes is as follows:
Exits: Gateway Distriparks, Monsanto India, Astral Poly Technik, Ipca, VST
Industries, eClerx Services, Coal India and Wabco India drop out on account of
deterioration in their greatness scores. We exclude Bata India on account of our
sector analysts negative view on its business.
Exhibit 9: Reasons behind the stocks exiting our ten-bagger portfolio

Company name
Metrics in our Greatness model no longer met by the company
Gateway Distriparks
Investment in gross block, balance sheet discipline, cash flows improvement, improvement in return ratios
Monsanto India
Investment in gross block, sales improvement, cash flows improvement, balance sheet discipline
Astral Poly Technik
Pricing discipline, balance sheet discipline, improvement in return ratios
Ipca Laboratories
Sales improvement, pricing discipline, improvement in return ratios
VST Industries
Investment in gross block, sales improvement, cash flows improvement, balance sheet discipline
eClerx Services
Sales improvement, pricing discipline, balance sheet discipline, improvement in return ratios
Investment in gross block, sales improvement, pricing discipline, PAT and cash flows improvement, balance sheet discipline,
improvement in return ratios
Sales improvement, pricing discipline, PAT and cash flows improvement, improvement in return ratios
Coal India*
Wabco India
Source: Ace Equity, Capitaline, Ambit Capital research * We have a Bottom-up Buy on this stock
Entrants: AIA Engineering, Ajanta Pharma, Hatsun Agro Products, La Opala,

Hindustan Unilever, Vinati Organics, Atul Ltd, Marico and Gujarat Pipavav are the
8 names that are added using FY15 data (implying that these firms greatness
scores improved when FY15 data was added to the model and FY09 data was
taken out of the model).
Having identified the 30 great firms that exhibit the ingredients required to be
tomorrows winners, we run a valuation check to ascertain if they are currently
trading at reasonable prices for outright investments. In our view, whilst valuations do
matter on a tactical basis, how the underlying fundamentals evolve for the firm over
long periods plays a more important role in determining returns than the beginningof-the-period valuation itself. Further, the performance of the previous iterations of
our ten-bagger portfolio corroborates our finding that beginning of the period
valuations do not play a significant role in shaping subsequent investment
returns. We discuss this in detail in the final section of this note.
To determine whether a particular stock is cheap or not, we categorise these stocks
into three buckets based on their relative attractiveness on valuations with respect to
their own history. We compare these firms with respect to their five-year average
valuations on three metricsP/B, P/E and EV/EBITDA. We find seven firms to be
inexpensive (on at least two of the three metrics): ITC, Idea Cellular, HCL Tech, TCS,
Gujarat Pipavav, MRF and Tata Motors. However, for the long term, all 30 stocks
remain candidates to be ten baggers from our perspective (as we have reiterated
time and again that current period valuations do not have a significant effect on
long-term returns! Please see pages 17-18 for details).
January 05, 2016
For the long-term investor,

beginning-of-period valuations
do not have a significant impact
on returns
Page 8
Strategy
We have bottom-up coverage with BUYs on 12 of these names. These are: ITC, PI
Industries, HCL Techn, Page Industries, Finolex Cables, TCS, Tata Motors, Supreme
Industries, Berger Paints, TVS Motor, HUL and Marico.
Exhibit 10: January 2016 ten baggers - Valuation perspective
Sr. No. Ticker
Company
Mcap
(US$ mn)
Blended FY15 and FY16

valuations
P/E
Cheap w.r.t. history?
P/B EV/EBITDA
P/E
P/B
EV/EBITDA
Overall cheap on
how many counts?
1
ITC IN
ITC Ltd.
IDEA IN
Idea Cellular
HCLT IN
HCL Tech.
TCS IN
TCS
GPPV IN
Gujarat Pipavav
MRF IN
MRF
TTMT IN
Tata Motors
39,216
26.1
7.7
16.8
YES
YES
YES
7,328
15.3
17,856
16.0
2.1
5.7
4.5
12.0
YES
YES
YES
YES
YES
YES
70,083
1,142
22.1
8.3
16.0
23.0
3.5
16.3
YES
YES
YES
YES
YES
YES
2,579
9.8
2.6
5.4
YES
YES
18,462
10.4
2.0
4.4
YES
YES
3,679
24.4
8.3
11.5
YES
12,139
35.3
8.5
24.7
8
TRP IN
Torrent Pharma
Rich valuations***
9
LPC IN
Lupin Ltd.
10
PSYS IN
Persistent Systems#
777
17.4
3.5
10.3
11
KJC IN
Kajaria
1,175
38.8
9.5
19.1
12
BRIT IN
Britannia#
5,353
47.0
24.4
30.2
13
SKB IN
GSKConsumer#
4,101
42.9
11.9
30.7
14
PI IN
PI Industries Ltd.
1,350
32.1
8.6
21.0
15
MTCL IN
Mindtree#
1,826
21.4
5.6
15.0
16
PAG IN
Page Industries
2,270
66.0
32.8
38.9
17
FNXC IN
Finolex Cables
576
19.0
2.9
12.3
18
SI IN
Supreme Industries
1,314
27.3
6.6
14.5
19
BRGR IN
Berger Paints
2,742
59.1
13.4
30.3
20
EIM IN
Eicher Motors#
7,131
61.4
15.8
27.7
21
TVSL IN
TVS Motor
2,046
38.4
9.4
22.0
22
SF IN
Sundram Fasteners
23
AJP IN
Ajanta Pharma
24
HTSMF IN
Hatsun Agro Products
25
LOG IN
La Opala
26
HUVR IN
Hindustan Unilever
520
24.2
4.0
12.1
1,753
34.2
12.1
22.2
676
78.5
18.1
17.1
514
70.3
16.5
41.2
27,900
42.6
44.0
31.5
27
VO IN
Vinati Organics
360
19.7
5.0
11.2
28
MRCO IN
Marico Ltd.
4,363
46.1
14.4
28.1
29
AIAE IN
AIA Engineering#
1,254
19.9
3.8
12.3
30
ATLP IN
Atul Ltd.
756
19.5
4.4
12.4
Source: Bloomberg, Capitaline, Ambit Capital research.

* Trading below five-year average P/E, P/B, EV/EBITDA (on at least two of these three measures)
** Trading below either five-year average P/E, five-year P/B or five-year EV/EBITDA (on one of these three measures)
*** Trading above five-year average P/E, P/B and EV/EBITDA
# denotes that the relevant Ambit sector lead has a bottom-up SELL in the name
Note: There are a few stocks that cleared both the greatness and accounting filters but did not make it to the final list of 30 stocks based on our lack of conviction
on the names. These are: Dr Reddys, Aurobindo Pharma, P&G Hygiene, KRBL Ltd, Suven Life sciences, Kaveri Seeds, Welspun India, Relaxo Footwears, Aarti
Industries, Granules India, Aarti Drugs, Arvind, Vardhman textiles, Kitex Garments, Geometric, Metalyst Forgings, Sun Pharma, BPCL, UPL Ltd, Amara Raja,
Hexaware, Tata Elxi, Navneet Education, Alembic Pharma, Ceat, Marksans Pharma, DCM Shriram, Greenply, Tube Investments, Rajesh Exports, Dishman Pharma,
Vakrangee, Bata India, Ratnamani Metals, Wipro
January 05, 2016
Page 9
Strategy
Exhibit 11: January 2016 ten baggers financial snapshot
Sr.
No.
Ticker
Company
3-yr
Mcap 6M ADV share
(US$ mn) (US$ mn) price
CAGR
3-yr Net
Sales
CAGR
3-yr adj.
PAT
CAGR
3-yr 3-yr avg

CFO
PBIT
CAGR margin
3-yr
avg
RoE
3-yr FY15 Net

avg
Debt/
RoCE
Equity
FY16
P/E
FY16
P/B
1
ITC IN
ITC Ltd.
IDEA IN
Idea Cellular
39,216
34.1
5%
14%
16%
16%
34%
34%
50%
(0.5)
26.1
7.7
7,328
10.0
7%
17%
65%
40%
14%
12%
12%
0.6
15.3
2.1
HCLT IN
HCL Tech.
17,856
24.5
39%
21%
44%
29%
21%
37%
43%
0.0
16.0
4.5
4
5
TCS IN
TCS
70,083
45.0
22%
25%
23%
41%
27%
41%
52%
(0.4)
22.1
8.3
GPPV IN
Gujarat Pipavav
1,142
2.4
49%
21%
81%
80%
38%
14%
14%
(0.2)
23.0
3.5
MRF IN
MRF#
2,579
7.7
45%
11%
37%
39%
11%
23%
28%
0.0
9.8
2.6
TTMT IN
Tata Motors
18,462
56.8
7%
17%
0%
24%
9%
27%
21%
0.5
10.4
2.0
20%
31%
18%
19%
36%
30%
0.8
24.4
8.3
8
TRP IN
Torrent Pharma
3,679
4.5 59%
Rich valuations***
9
LPC IN
Lupin Ltd.
10
PSYS IN
Persistent Systems
11
KJC IN
Kajaria
12,139
34.0
44%
22%
40%
70%
23%
30%
36%
(0.2)
35.3
8.5
777
1.1
34%
24%
26%
22%
17%
21%
28%
(0.6)
17.4
3.5
1,175
1.5
61%
19%
30%
26%
13%
30%
32%
0.3
38.8
9.5
5,353
9.7
80%
13%
46%
33%
8%
54%
57%
(0.5)
47.0
24.4
(1.1)
42.9
11.9
12
BRIT IN
13
SKB IN
14
PI IN
Britannia Industries
Ltd.
GSKConsumer
Healthcare Ltd.
PI Industries Ltd.
1,350
2.8
74%
30%
46%
21%
14%
28%
33%
0.1
32.1
8.6
15
MTCL IN
Mindtree Ltd.
1,826
4.6
61%
23%
33%
43%
17%
29%
37%
(0.5)
21.4
5.6
16
PAG IN
Page Industries
2,270
3.1
58%
30%
29%
11%
20%
59%
64%
0.4
66.0
32.8
17
FNXC IN
Finolex Cables
576
0.4
62%
6%
11%
-4%
8%
17%
20%
(0.3)
19.0
2.9
18
SI IN
Supreme Industries
1,314
0.9
32%
13%
10%
20%
13%
32%
37%
0.1
27.3
6.6
4,101
1.2
19%
16%
18%
16%
16%
33%
49%
19
BRGR IN
Berger Paints
2,742
1.1
50%
14%
13%
25%
9%
24%
25%
0.2
59.1
13.4
20
EIM IN
Eicher Motors
7,131
20.3
84%
15%
26%
37%
9%
21%
25%
(0.6)
61.4
15.8
2,046
7.9
85%
12%
30%
-45%
4%
19%
18%
0.5
38.4
9.4
520
0.3
48%
4%
10%
-20%
7%
15%
14%
1.0
24.2
4.0
21
TVSL IN
TVS Motor
22
SF IN
Sundram Fasteners
23
AJP IN
Ajanta Pharma
1,753
4.4
134%
30%
60%
58%
26%
41%
50%
(0.1)
34.2
12.1
24
HTSMF IN
Hatsun Agro
Products
676
0.1
67%
22%
13%
6%
4%
35%
19%
2.7
78.5
18.1
25
LOG IN
La Opala
514
1.4
124%
25%
49%
48%
24%
34%
39%
(0.4)
70.3
16.5
26
HUVR IN
Hindustan Unilever
27,900
18.8
17%
11%
12%
2%
15%
103%
146%
(1.4)
42.6
44.0
27
VO IN
Vinati Organics
360
0.3
45%
20%
28%
79%
21%
31%
32%
0.1
19.7
5.0
28
MRCO IN
Marico Ltd.
4,363
5.3
27%
13%
21%
18%
13%
29%
31%
(0.0)
46.1
14.4
1,254
1.0
39%
16%
33%
48%
21%
20%
26%
(0.3)
19.9
3.8
756
1.0
60%
14%
38%
51%
12%
22%
24%
0.2
19.5
4.4
29
AIAE IN
AIA Engineering
30
ATLP IN
Atul Ltd.
Source: Bloomberg, Ambit Capital research; # represents companies for which FY15 data is not available and FY14 data is used instead
January 05, 2016
Page 10
Strategy
Exhibit 12: January 2016 ten baggers - Forward-looking data using consensus estimates
Sr. No.
Ticker
Company
Mcap
(US$ mn)
6M ADV
(US$ mn)
FY15-FY18E
EPS CAGR
FY15-FY18E
BVPS CAGR
39,216
33.3
11%
11%
1
ITC IN
ITC Ltd.
IDEA IN
Idea Cellular
7,328
9.8
-2%
10%
HCLT IN
HCL Tech.
17,856
24.0
10%
18%
TCS IN
TCS
70,083
44.4
15%
26%
GPPV IN
Gujarat Pipavav
1,142
2.4
9%
15%
MRF IN
MRF
2,579
7.5
0%
17%
TTMT IN
Tata Motors
18,462
56.0
12%
25%
3,679
4.5
24%
33%
12,139
33.3
19%
25%
8
TRP IN
Torrent Pharma
Rich valuations***
9
LPC IN
Lupin Ltd.
10
PSYS IN
Persistent Systems
777
1.0
12%
15%
11
KJC IN
Kajaria
1,175
1.5
24%
24%
12
BRIT IN
Britannia Industries Ltd.
5,353
9.6
22%
32%
13
SKB IN
GSKConsumer Healthcare Ltd.
4,101
1.3
17%
16%
14
PI IN
PI Industries Ltd.
1,350
2.7
25%
28%
15
MTCL IN
Mindtree Ltd.
1,826
4.6
16%
20%
16
PAG IN
Page Industries
2,270
3.0
27%
32%
17
FNXC IN
Finolex Cables
576
0.4
14%
12%
18
SI IN#
Supreme Industries
1,314
0.9
15%
16%
19
BRGR IN
Berger Paints
2,742
1.1
29%
20%
20
EIM IN
Eicher Motors
7,131
19.9
41%
27%
21
TVSL IN
TVS Motor
2,046
7.9
32%
28%
22
SF IN#
Sundram Fasteners
23
AJP IN
Ajanta Pharma
24
HTSMF IN#
Hatsun Agro Products
25
LOG IN
La Opala
26
HUVR IN
Hindustan Unilever
520
0.3
24%
13%
1,753
4.3
25%
35%
676
0.1
80%
25%
514
1.4
32%
28%
27,900
18.3
10%
10%
27
VO IN
Vinati Organics
360
0.3
17%
24%
28
MRCO IN
Marico Ltd.
4,363
5.3
18%
20%
29
AIAE IN
AIA Engineering
1,254
0.9
6%
15%
30
ATLP IN
Atul Ltd.
756
1.0
19%
23%
Source: Bloomberg, Ambit Capital research; Note: # indicates FY15-17E CAGR

January 05, 2016
Page 11
Strategy
Greatness framework on sub-BSE500 firms

In our January 2013 ten baggers 2.0 note, based on client feedback, we had inserted
a list of sub-BSE500 firms that did well on our framework primarily in the hope that
given the inefficient price discovery in the smaller-cap names, running the screen on
relatively lesser-known names should work even better. The results surely have been
very encouraging. The sub-BSE500 list from our ten baggers 2.0 portfolio delivered
22.4% in absolute terms and 41.2% points of alpha relative to the BSE Small-cap
Index from January 2013 to November 2013. Likewise, the sub-BSE500 list from our
ten baggers 3.0 portfolio delivered a staggering 137.3% returns in absolute terms
and 50.5% points of alpha relative to the BSE Small-cap Index. The most recent subBSE500 list from our last iteration ten baggers 4.0 has again delivered 28% return
on an absolute basis and 23% alpha relative to the BSE Small-cap Index (please see
page 15 for performance details).
Continuing with this initiative, we present below a list of select small-caps from
outside the BSE500 but above a market cap of Rs1,000mn that fare well on this
years iteration of our greatness framework (after updating FY15 numbers). Based on
client feedback, we have extended our forensic accounting model to all firms with a
market cap of Rs1,000mn and above. Whilst these stocks have cleared our
accounting screen, we may not have sufficient information on the quality of their
corporate governance.
The framework should work

better in the less-discovered subBSE500 universe
Exhibit 13: January 2016 greatness framework on smaller caps outside BSE500
Sr. No.
Ticker
Company
TCPL IN
TCPL Packaging#
PLM IN
Poly Medicure
ATA IN
AVNT IN
KPR IN
Mcap
(US$ mn)
6M ADV
(US$ mn)
FY16 P/E
FY16 P/B
87
0.0
13.6
4.1
259
0.1
34.0
7.2
Atul Auto
181
0.6
25.3
8.0
Avanti Feeds
282
0.7
11.3
5.1
K P R Mill Ltd
495
0.9
14.4
2.9
FIEM IN
Fiem Inds.
137
0.7
16.7
3.4
HSS IN
Himatsing. Seide
312
3.5
11.8
2.2
FDM IN
Fluidomat
16
0.0
N/A
N/A
MUIL IN
Multibase India Ltd#
49
0.1
N/A
N/A
10
NCS IN
Nucleus Software#
124
1.0
N/A
N/A
Source: Bloomberg, Ambit Capital research; Note: Stocks that passed the two models but were omitted are:
Nandan Denim, Chamanlal Setia, Trident, Heritage Foods, Kovai Medical, Moreopen labs, RSWM, Alkyl Amines,
ShirpurGold, Ruchira Papers, Guj Alkalies,SKM Egg Products, Sreeleathers, Cupid, Paushak, Premco Global,
Lambodhara Textiles, Benares Hotels, KG Denim, Loyal Textile, Coromandel Engg, Mastek, APM Inds
# denotes new entrant to the portfolio
Note that unlike the ten-baggers list for the BSE500 universe (where we only consider
firms that meet the greatness score cut-off of 67% whilst being in the top 6 deciles of
our forensic accounting model), the criteria used to screen for ten baggers from the
sub-BSE500 universe has been made much more stringent. Only firms with a
greatness score above 80% that also fall in the top three deciles on accounting
quality in the sub-BSE500 universe have been included in this list.
On a separate note, if you havent already contacted your Ambit sales representative,
for a forensic check on your portfolio, you might want to do so now. Our forensic
model, refined and tested over five years, is very powerful.
January 05, 2016
Page 12
Strategy
Performance check: Jan 2015 ten-bagger list

Exhibit 14: The ten-bagger list published on 05 January 2015 (click here for the 05
January 2015 note, Ten baggers 4.0)
Ticker
Company
Attractive valuations
TCS IN
TCS
ITC IN
ITC
TTMT IN
Tata Motors
HCLT IN
HCL Tech
IDEA IN
Idea Cellular
IPCA IN
Ipca Labs.
ECLX IN
eClerx Services
Moderate valuations
COAL IN
Coal India
BATA IN
Bata India
Rich valuations
LPC IN
EIM IN
SKB IN
BRIT IN
TRP IN
MRF IN
BRGR IN
PAG IN
TVSL IN
MTCL IN
WIL IN
SI IN
PI IN
PSYS IN
MCHM IN
KJC IN
ASTRA IN
FNXC IN
SF IN
GDPL IN
VST IN
Lupin
Eicher Motors
GlaxoSmith CHL
Britannia Inds.
Torrent Pharma.
MRF
Berger Paints
Page Industries
TVS Motor Co.
Mindtree
WABCO India
Supreme Inds.
P I Inds.
Persistent Sys
Monsanto India
Kajaria Ceramics
Astral Poly
Finolex Cables
Sundram Fasten.
Gateway Distr.
VST Inds.
Price
Mcap
Performance
(US$ mn) 02-Jan-2015
04-Jan-2016
2,579
70,080
39,215
368
18,462
506
17,857
803
160
7,328
1,386
727
856
993
Average for this bucket
2,370
325
377
846
136
732
1,401
-8%
-12%
-26%
5%
-15%
1%
41%
-2%
31,304
382
660
983
351
509
-8%
-23%
-15%
12,138
1,432
15,082
7,130
4,101
5,900
5,353
1,879
3,679
1,193
2,579
38,192
2,742
226
2,270
12,420
2,046
267
1,827
1,299
1,737
4,661
1,314
597
1,350
550
777
937
571
2,926
1,175
618
770
387
575
269
520
195
512
350
394
1,940
1,795
17,495
6,496
2,973
1,448
40,506
263
13,558
287
1,451
6,101
689
656
647
2,205
985
428
251
165
314
1,700
25%
16%
10%
58%
21%
6%
16%
9%
7%
12%
31%
15%
19%
-31%
-25%
59%
11%
-7%
-15%
-11%
-12%
10%
6%
-3%
9%
Overall average
BSE500 Index
Outperformance
In a difficult year for the Indian equity markets, last years iteration of ten baggers
published on 05 January 2015 has clocked 6% returns in absolute terms and 9%
points relative to the BSE500. This compares with cumulative absolute returns of
109% and relative returns (to BSE500) of 43% points delivered by the first three
iterations (click here for the 19 January 2012 note on ten baggers 1.0 and click here
for the 14 January 2013 note on ten baggers 2.0 and click here for the 26 November
2013 note on ten bagger 3.0). Moreover, the above exhibit also highlights that
beginning-of-the-period valuations have not made much difference to investment
returns, with the stocks categorised as attractively valued, based on initial valuations,
underperforming those classified as richly valued on average. This finding also
emerged from earlier ten bagger iterations. In effect, what our models have shown
time and again is that once you screen rigorously for high quality, there is little
value add in further screening through a demanding valuation filter.
January 05, 2016
Page 13
Strategy
Performance check: Jan 2015s sub-BSE500 ten

baggers
Exhibit 15: Superior firms on greatness from sub-BSE500 published on 05 January
2015 (click here for the 05 January 2015, Ten baggers 4.0)
Price
Mcap
(US$ mn) 02-Jan-2015
04-Jan-16
Performance
Ticker
Company
SVLS IN
Suven Life Scie.
498
212.8
260.45
22%
LOG IN
La Opala RG
514
446.55
617.5
38%
PLM IN
Poly Medicure
259
452.1
390.95
-14%
MUNI IN
Mayur Uniquote
326
422.75
469.65
11%
GRAN IN
Granules India
461
82.87
146.65
77%
SEL IN
Suprajit Engg.
259
138
143.75
4%
ATA IN
Atul Auto
181
677.95
550.9
-19%
AVNT IN
Avanti Feeds
282
320.94
413.9
29%
KPR IN
K P R Mill Ltd
495
377.3
874.9
132%
HPPL IN
Huhtamaki PPL
260
185.75
237.9
28%
FIEM IN
Fiem Inds.
137
872.2
760.75
-13%
HSS IN
Himatsing. Seide
312
94.25
211.2
124%
WMP IN
Wim Plast
180
1507.8
2000.75
33%
SIYA IN
Siyaram Silk
168
957.45
1191.9
24%
IDR IN
Indag Rubber
82
185.25
208.2
12%
ADFI IN
Adi Finechem
52
332.85
249.1
-25%
FDM IN
Fluidomat
16
210.15
215.7
3%
28%
Overall average
BSE Smallcap Index
4%
Outperformance
23%
The sub-BSE500 list of firms published on 05 January 2015 has also shown strength
and delivered a stellar performance over the year. These stocks are up 28% on
average over the year (vs 4% for the BSE Small-cap Index), resulting in ~23% points
of outperformance since publication. Absolute returns of 22% (and relative returns of
41%) for the first iteration of the sub-BSE500 ten baggers (published on 14 January
2013), a whopping 51% outperformance for the November 2013 iteration and 25%
outperformance of the last iteration suggest that the framework indeed does a
reasonably good job in the sub-BSE500 universe as well.
January 05, 2016
Page 14
Strategy
Valuations - A long-term perspective!

Over long periods, it is how the underlying fundamentals evolve for the firm that
plays a more important role in determining returns rather than the beginning-period
valuation itself. Put another way, over long periods how a business fundamentally
performs is overwhelmingly the most important driver of investment returns (so much
so that the price at the time of entering the stock becomes almost irrelevant). This
point can be understood better with the following exhibits that plot ten-year returns
over FY04-14 vs FY04 valuations as measured by P/B and P/E at the beginning of the
period (in 2005).
Exhibit 16: Valuation impact on long-term returns - P/B
FY05-FY15 share price CAGR
40%
R = 0.071
30%
20%
10%
0%
-10%
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
-20%
-30%
-40%
-50%
FY05 price to book
Source: Ambit Capital research; Note: FY04-14 returns here are stock returns relative to Sensex
The value of the R-squared makes the story self-explanatory. A low value for this
parameter indicates that the beginning-period valuations do not play any meaningful
role in explaining stock returns over the next ten years. This holds true for both P/B
and P/E as measures of valuation.
Exhibit 17: Valuation impact on long-term returns - P/E
FY05-FY15 share price CAGR
40%
R = 0.0143
30%
20%
10%
0%
-10%
20.0
40.0
60.0
80.0
100.0
-20%
-30%
-40%
-50%
FY05 price to earnings
Source: Ambit Capital research; Note: FY04-14 returns here are stock returns relative to Sensex. Trailing P/E has
been restricted to 100.
Further, that valuations do not play an overwhelming role in shaping investment

returns is also evidenced by the performance of the latest iteration of our ten-bagger
portfolio.
The following exhibits plot the returns since publication for the 30 stocks published as
a part of the ten-bagger portfolio on 05 January 2015 vs their trailing valuations as
measured by P/B and P/E at the beginning of the period.
January 05, 2016
Page 15
Strategy
Exhibit 18: Tenbaggers 4.0 - Beginning-period P/B and stock returns
R = 0.0635
Share price performance
80%
60%
40%
20%
0%
-
10.0
20.0
30.0
40.0
50.0
60.0
-20%
-40%
Trailing Price to Book
Here again, a low R-squared value indicates that the beginning-period P/B does not
influence stock returns in any major way. This holds true for P/E as a measure of
valuation as well.
Exhibit 19: Tenbaggers 4.0: beginning-period P/E and stock returns
R = 0.0791
Share price performance
80%
60%
40%
20%
0%
-
20.0
40.0
60.0
80.0
100.0
-20%
-40%
Trailing Price to Earnings
January 05, 2016
Page 16
Strategy
Appendix - January 2016 ten baggers

business activity description
BSE500 ten baggers business description
Sr. No. Ticker
Company
Business description
TCS IN
TCS
Tata Consultancy Services, a division of Tata Sons Limited, is a global IT services organization that provides
a comprehensive range of IT services to its clients in diverse industries. The Company, caters to finance
and banking, insurance, telecommunication, transportation, retail, manufacturing, pharmaceutical, and
utility industries.
ITC IN
ITC
ITC Limited, a member of BAT Group of UK, is a holding company, which has a diversified presence in
Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri Business, Packaged Foods &
Confectionery, Branded Apparel, Greeting Cards and other FMCG products.
Tata Motors
Tata Motors Limited manufactures cars and commercial automotive vehicles in India. The Company
designs, manufactures and sells heavy commercial, medium commercial and small commercial vehicles
including trucks, tankers, vans, buses, ambulances and minibuses. Tata also manufactures small cars and
sports utility vehicles.
TTMT IN
HCLT IN
HCL Technologies
HCL Technologies Limited provides software development and related engineering services. The Group's
technologies utilize a variety of technologies, including Internet and e-commerce, networking, internet
telephony, embedded software, ASIC/VLSI design and testing, satellite and wireless communications, and
component based object technologies, including COM, DCOM and COBRA.
IDEA IN
Idea Cellular
Idea Cellular Limited offers cellular services, SMS services, and mobile communication devices.
AIAE IN
AIA Engg
AIA Engineering specialises in the design, development, manufacture, installation and servicing of high
chromium wear, corrosion and abrasion resistant castings used in the cement, mining and thermal power
generation industries.
HTSMF IN
Hatsun Agro
Hatsun Agro is the largest private sector dairy company in India. It produces and markets wide range of
dairy products dairy whitener, skimmed milk powder, Agmark certified ghee, butter, cooking butter, milk,
varities of curd, paneer etc. It also exports to 38 countries worldwide.
Gujarat Piapavav
Gujarat Pipavav is managed and operated by APM Terminals, the ports and terminals company of the
maritime giant, the A.P. Moller-Maersk Group. APM Terminals is one of the largest container terminal
operators in the world and offers the global shipping community an integrated Global Terminal Network
of 56 ports and 154 inland facilities in 63 countries.
GPPV IN
LPC IN
Lupin
Lupin Limited manufactures bulk actives and formulations. The principal bulk actives manufactured by it
include Rifampicin, Pyrazinamide, Ethambutol (anti-TB), Cephalosporins (anti-infectives) and
cardiovasculars. The company also possesses competencies in phytomedicines, in which medicines are
made out of plant and herbal resources supported by the discipline of modern medicine.
10
EIM IN
Eicher Motors
Eicher Motors Ltd. manufactures light commercial vehicles which are sold domestically and are also
exported to other countries. Eicher Motors also manufactures tractors, two-wheelers and automotive
gears.
11
SKB IN
GlaxoSmith C H L
Glaxo SmithKline Consumer Healthcare Limited manufactures and sells malted milk food products. The
Group's products, which include energy & protein products, cereals, baby foods, ghee & butter, are sold
under the "Horlicks", "Boost", "Viva", "Brylcream", "Eno", "Maltova" and "Gopika" brand names.
12
BRIT IN
Britannia Inds.
Britannia Industries Limited manufactures bakery products such as biscuits, bread, cakes and rusks. The
Company also manufactures and exports soybean products, cashew kernels, marine products, and general
merchandise items.
13
TRP IN
Torrent Pharma.
Torrent Pharmaceuticals Ltd. manufactures bulk drugs and pharmaceutical formulations. The Company's
formulations include cardio-vascular, psychotropic and anti-biotic drugs while its bulk drugs include
atenolol, ciprofloxacin and norfloxacin. Torrent Pharmaceuticals has wholly owned subsidiaries in several
regulated and less regulated international markets.
14
MRF IN
MRF
MRF Limited manufactures and distributes tyres and tubes for automobiles, aircrafts, motorcycles and
cycles. The Company also manufactures conveyor belts, paint and coats, and hoses. Every MRF tyre
designed is the result of a special acid test on the race and rally tracks.
15
BRGR IN
Berger Paints
Berger Paints India Limited manufactures and distributes paints, enamels, varnishes, and synthetic resins.
The Company's products are used in home, office, factory, interiors, exteriors, metal, wood, plastic, and
others.
16
PAG IN
Page Industries
Page Industries Limited develops, produces, and distributes branded underwear for men, women, and
children in India and Sri Lanka.
January 05, 2016
Page 17
Strategy
Sr. No. Ticker
17
18
19
TVSL IN
MTCL IN
AJP IN
Company
TVS Motor Co.
TVS Motor Company Limited manufactures motorcycles, mopeds and scooters. The Company also
manufactures spark ignition operated outboard motors, combustion spark ignition engines, critical engines
and transmission parts. TVS Motor Co. also owns a subsidiary that manufactures rubber molded and
plastic molded auto components, air brake hoses and molds.
Mindtree
Mindtree Limited is an international IT company. The Company delivers business and technology solutions
through global software development. Mindtree develops applications to help companies enhance their
enterprise operations. The Company also delivers product-development services and designs reusable
building blocks for high-tech companies.
Ajanta Pharma
Ajanta Pharma is a specialty pharmaceutical company engaged in development, manufacture and

marketing of quality finished dosages in domestic and international markets. Its focus is on
commercializing unique generic products and pioneering synergistic combination products in the
therapeutic areas of anti-malarial, cardiovascular, dermatology, male erectile dysfunction, pain
management, and ophthalmology.
20
SI IN
Supreme Inds.
Supreme Industries Limited manufactures industrial and engineered molded products and storage and
material handling crates. The Company also manufactures chemicals, multilayer sheets, multilayer films,
packaging films and expanded polyethylene foam, PVC pipes and fittings, molded furniture and disposable
EPS containers.
21
PI IN
P I Inds.
PI's business activities include 1) Agri Inputs offering plant protection products, and speciality plant nutrient
products and solutions and 2) Custom Synthesis & Manufacturing for contract research and production of
agro chemicals, intermediates and other niche fine chemicals for global innovators.
22
PSYS IN
Persistent Sys
Persistent Systems Limited offers outsourced software product development. The Company offer services
that include testing, support, and professional services.
23
LOG IN
La Opala
La Opala is manufacturer and marketer of life style products in tableware segment. The company deals
with glass and glassware and products include opalware and crystal.
24
KJC IN
Kajaria Ceramics
Kajaria Ceramics Limited manufactures glazed and unglazed ceramic tiles. The Company sells its products
in India and it also exports them to other countries.
25
HUVR IN
HUL
HUL is Indias largest FMCG company with a heritage of over 80 years in India. It has over 35 brands
spanning across categories like soaps, detergents, shampoos, skin care, toothpastes, detergents, packaged
foods etc. It is a subsidiary of Unilever, one of the worlds largest FMCG company.
26
FNXC IN
Finolex Cables
Finolex Cables Ltd. manufactures a wide range of telecommunication and electrical cables. The Company's
products include flexible cables for appliances and industrial use electrification, winding wires, automobile
cables, welding cables, and cables for submersible pumps. The Company also manufactures jelly filled
phone cables, high frequency/radio frequency cables and PVC Sheets.
27
SF IN
Sundram Fasten.
Sundram Fasteners Limited manufactures a wide range of nuts, bolts and related fastener equipment.
Products include high-tensile fasteners and equipment for the automotive industry, such as cold extruded
parts, radiator caps and gear shifters. The Company also manufactures water pumps and fuel pumps.
28
MRCO IN
Marico
Marico Limited is one of India's leading consumer products companies operating in the beauty and
wellness space. Currently present in 25 countries across emerging markets of Asia and Africa, Marico has
nurtured multiple brands in the categories of hair care, skin care, health foods, male grooming, and fabric
care.
29
VO IN
Vinati Organics
Vinati Organics Ltd. is a specialty chemical company producing aromatics, monomers, polymers and other
speciality products and has a sturdy market presence in over 22 countries.
30
ATLP IN
Atul Ltd.
Atul Ltd is an improvement driven, integrated chemical company serving customers across the globe. With
depth in science and technology, Atul manages almost all Unit Processes and Unit Operations to
manufacture about 1,380 products and formulations and has state-of-the-art facilities and processes to
ensure safety and treatment of gaseous, liquid and solid pollutants.
Source: Bloomberg
January 05, 2016
Page 18
Strategy
Sub-BSE500 ten baggers business description
Sr. No. Ticker
Company
TCPL IN
TCPL Packaging
TCPL Packaging Ltd., (formerly known as Twenty-First Century Printers Ltd) began commercial production in
April 1990. It is one of India's largest manufacturers of printed folding cartons, and one of the few listed
packaging companies in India.
PLM IN
Poly Medicure
Poly Medicure Limited manufactures disposable healthcare products. The Company offers a wide range of
products for infusion therapy, anesthesia, urology, gastroenterology, blood management, surgery and
drainage, and catheters.
ATA IN
Atul Auto
Atul Auto Ltd. manufactures three-wheeled commercial diesel vehicles.
AVNT IN
Avanti Feeds
Avanti Feeds Ltd. manufactures and distributes shrimp feed. The Company also processes, packages, and
exports shrimp throughout the world.
KPR IN
K P R Mill Ltd
KPR Mill Limited manufactures apparel products. The Company's products include carded and combed cotton
and knitted fabrics.
FIEM IN
Fiem Inds.
FIEM Industries Limited manufactures automotive lighting and signaling equipment and rear view mirrors.
HSS IN
Himatsing. Seide
Himatsingka Seide Limited manufactures home textile products. The Company produces decorative fabrics,
spun silk, blended fabrics, bridal wear, fashion wear and other related textile products. Himatsingka Seide
offers its products to distributors across the United States and Europe.
FDM IN
Fluidomat
Fluidmat Ltd. manufactures fluid coupling, turbo couplings, flexible coupling, and mechanical power
transmission equipment.
MUIL IN
Multibase India
Multi base India is a Dow corning company that manufactures silicon based thermoplastics with application
in automotives, personal care, personal hygiene, telecom and engineering polymers
10
NCS IN
Nucleus Software
Nucleus Software provides lending and transaction banking products to the global financial services industry.
Its two flagship products are FinnOne and FinnAxia
Source: Bloomberg
January 05, 2016
Page 19
Strategy
Institutional Equities Team

Saurabh Mukherjea, CFA
CEO, Institutional Equities
(022) 30433174
saurabhmukherjea@ambitcapital.com
Research
Analysts
Industry Sectors
Nitin Bhasin - Head of Research
E&C / Infra / Cement / Industrials
(022) 30433241
Desk-Phone E-mail
nitinbhasin@ambitcapital.com
Aadesh Mehta, CFA
Banking / Financial Services
(022) 30433239
aadeshmehta@ambitcapital.com
Aakash Adukia
Oil & Gas / Chemicals / Agri Inputs
(022) 30433273
aakashadukia@ambitcapital.com
Abhishek Ranganathan, CFA
Retail / Mid-caps
(022) 30433085
abhishekr@ambitcapital.com
Achint Bhagat, CFA
Cement / Roads / Home Building
(022) 30433178
achintbhagat@ambitcapital.com
Ashvin Shetty, CFA
Automobile
(022) 30433285
ashvinshetty@ambitcapital.com
Bhargav Buddhadev
Power Utilities / Capital Goods
(022) 30433252
bhargavbuddhadev@ambitcapital.com
Deepesh Agarwal, CFA
Power Utilities / Capital Goods
(022) 30433275
deepeshagarwal@ambitcapital.com
Dhiraj Mistry, CFA
Consumer
(022) 30433264
dhirajmistry@ambitcapital.com
Gaurav Khandelwal, CFA
Automobile
(022) 30433132
gauravkhandelwal@ambitcapital.com
Gaurav Mehta, CFA
Strategy / Derivatives Research
(022) 30433255
gauravmehta@ambitcapital.com
Girisha Saraf
Mid-caps / Small-caps
(022) 30433211
girishasaraf@ambitcapital.com
Karan Khanna, CFA
Strategy
(022) 30433251
karankhanna@ambitcapital.com
Kushank Poddar
Technology
(022) 30433203
kushankpoddar@ambitcapital.com
Pankaj Agarwal, CFA
(022) 30433206
pankajagarwal@ambitcapital.com
Paresh Dave, CFA
Healthcare
(022) 30433212
pareshdave@ambitcapital.com
Parita Ashar, CFA
Metals & Mining
(022) 30433223
paritaashar@ambitcapital.com
Prashant Mittal, CFA
Derivatives
(022) 30433218
prashantmittal@ambitcapital.com
Rahil Shah
(022) 30433217
rahilshah@ambitcapital.com
Rakshit Ranjan, CFA
Consumer
(022) 30433201
rakshitranjan@ambitcapital.com
Ravi Singh
(022) 30433181
ravisingh@ambitcapital.com
Ritesh Gupta, CFA
Oil & Gas / Chemicals / Agri Inputs
(022) 30433242
riteshgupta@ambitcapital.com
Ritesh Vaidya, CFA
Consumer
(022) 30433246
riteshvaidya@ambitcapital.com
Ritika Mankar Mukherjee, CFA
Economy / Strategy
(022) 30433175
ritikamankar@ambitcapital.com
Ritu Modi
Automobile
(022) 30433292
ritumodi@ambitcapital.com
Sagar Rastogi
Technology
(022) 30433291
sagarrastogi@ambitcapital.com
Sumit Shekhar
Economy / Strategy
(022) 30433229
sumitshekhar@ambitcapital.com
Utsav Mehta, CFA
E&C / Industrials
(022) 30433209
utsavmehta@ambitcapital.com
Vivekanand Subbaraman, CFA
Media
(022) 30433261
vivekanands@ambitcapital.com
Sales
Name
Regions
Desk-Phone E-mail
Sarojini Ramachandran - Head of Sales
UK
Dharmen Shah
India / Asia
(022) 30433289
dharmenshah@ambitcapital.com
Dipti Mehta
India / USA
(022) 30433053
diptimehta@ambitcapital.com
Hitakshi Mehra
India
(022) 30433204
hitakshimehra@ambitcapital.com
Krishnan V
India / Asia
(022) 30433295
krishnanv@ambitcapital.com
Nityam Shah, CFA
USA / Europe
(022) 30433259
nityamshah@ambitcapital.com
Parees Purohit, CFA
UK / USA
(022) 30433169
pareespurohit@ambitcapital.com
Praveena Pattabiraman
India / Asia
(022) 30433268
praveenapattabiraman@ambitcapital.com
Shaleen Silori
India
(022) 30433256
shaleensilori@ambitcapital.com
Pramod Gubbi, CFA Director
Singapore
+65 8606 6476
pramodgubbi@ambitpte.com
Shashank Abhisheik
Singapore
+65 6536 1935
shashankabhisheik@ambitpte.com
+44 (0) 20 7614 8374 sarojini@panmure.com
Singapore
USA / Canada
Ravilochan Pola - CEO
Americas
+1(646) 361 3107
ravipola@ambitpte.com
Production
Sajid Merchant
Production
(022) 30433247
sajidmerchant@ambitcapital.com
Sharoz G Hussain
Production
(022) 30433183
sharozghussain@ambitcapital.com
Nikhil Pillai
Database
(022) 30433265
nikhilpillai@ambitcapital.com
E&C = Engineering & Construction
January 05, 2016
Page 20
Strategy
ITC LTD (ITC IN, BUY)
Idea Cellular Ltd (IDEA IN, NOT RATED)
450
400
350
300
250
200
250
200
150
100
ITC LTD
HCL TECHNOLOGIES LTD
Jan-16
Oct-15
Jul-15
Apr-15
Oct-14
Jan-15
Dec-15
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
0
Jun-13
Dec-12
500
Dec-15
200
Sep-15
1,000
Jun-15
400
Mar-15
1,500
Dec-14
600
Sep-14
2,000
Jun-14
800
Mar-14
2,500
Dec-13
1,000
Sep-13
3,000
Mar-13
Tata Consultancy Svcs Ltd (TCS IN, BUY)
1,200
Jun-13
Jul-14
HCL Technologies Ltd (HCLT IN, BUY)
Mar-13
Apr-14
IDEA CELLULAR LTD
Dec-12
Jan-14
Oct-13
Jul-13
Apr-13
0
Jan-13
Dec-14
Oct-14
Aug-14
Jun-14
Apr-14
Feb-14
Dec-13
Oct-13
Aug-13
Jun-13
Apr-13
Dec-12
Feb-13
50
TATA CONSULTANCY SVCS LTD
MRF Ltd (MRF IN, NOT RATED)
Gujarat Pipavav Port Ltd (GPPV IN, NOT RATED)
50,000
300
40,000
250
200
30,000
150
20,000
MRF Ltd
January 05, 2016
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Jan-13
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
0
Dec-12
50
Apr-13
100
10,000
GUJARAT PIPAVAV PORT LTD

Page 21
Strategy
Tata Motors (TTMT IN, BUY)
Atul Ltd (ATLP IN, NOT RATED)
700
2,000
600
500
400
300
1,500
1,000
200
100
0
500
TATA MOTORS LTD
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
ATUL LTD
Torrent Pharma Ltd (TRP IN, NOT RATED)
Lupin Ltd (LPC IN, NOT RATED)

2,500
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
2,000
1,500
1,000
500
PERSISTENT SYSTEMS LTD
January 05, 2016
Sep-15
Sep-15
Jun-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-12
Dec-15
Sep-15
0
Jun-15
0
Mar-15
200
Dec-14
200
Sep-14
400
Jun-14
400
Mar-14
600
Dec-13
600
Sep-13
800
Jun-13
800
Mar-13
1,000
Dec-12
1,000
Dec-13
Kajaria Ceramics Ltd (KJC IN, NOT RATED)
Sep-13
Persistent Systems Ltd (PSYS IN, SELL)
Jun-13
Mar-13
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
LUPIN LTD
Mar-15
TORRENT PHARMACEUTICALS LTD
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
KAJARIA CERAMICS LTD

Page 22
Strategy
Britannia Industries Ltd (BRIT IN, SELL)
Glaxosmithkline Consumer (SKB IN, SELL)
BRITANNIA INDUSTRIES LTD
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
Dec-12
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
GLAXOSMITHKLINE CONSUMER HEA
PI Industries Ltd (PI IN, BUY)
Mindtree Ltd (MTCL IN, SELL)
PI INDUSTRIES LTD
Dec-15
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
MINDTREE LTD
Page Industries Ltd (PAG IN, BUY)
Finolex Cables Ltd (FNXC IN, BUY)
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
PAGE INDUSTRIES LTD

January 05, 2016
Sep-15
Jun-15
Mar-15
Dec-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
350
300
250
200
150
100
50
0
Sep-14
Dec-12
Dec-12
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
800
700
600
500
400
300
200
100
0
FINOLEX CABLES LTD

Page 23
Strategy
Supreme Industries Ltd (SI IN, BUY)
Berger Paints India Ltd (BRGR IN, BUY)
800
700
600
500
400
300
200
100
0
300
250
200
150
100
Jun-15
Sep-15
Sep-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Jun-15
SUPREME INDUSTRIES LTD
Sep-13
Jun-13
Dec-12
Mar-13
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
50
BERGER PAINTS INDIA LTD
Eicher Motors Ltd (EIM IN, SELL)
TVS Motor (TVSL IN, BUY)
25,000
EICHER MOTORS LTD
Mar-15
Dec-14
Sep-14
Jun-14
Dec-12
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
Mar-14
5,000
Dec-13
10,000
Sep-13
15,000
Jun-13
20,000
Mar-13
350
300
250
200
150
100
50
0
TVS MOTOR CO LTD
Sundram Fasteners (SF IN, NOT RATED)
Ajanta Pharma Ltd (AJP IN, NOT RATED)
SUNDRAM FASTENERS LTD

January 05, 2016
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Apr-14
50
Jan-14
100
Oct-13
150
Jul-13
200
Apr-13
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
Jan-13
250
AJANTA PHARMA LTD

Page 24
Strategy
Hatsun Agro Products Ltd (HTSMF IN, NOT RATED)
La Opala Rg Ltd (LOG IN, NOT RATED)
500
700
600
500
400
300
400
300
200
HINDUSTAN UNILEVER LTD
Jul-15
Apr-15
Jan-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
200
100
0
Oct-13
200
Jul-13
400
Apr-13
600
Jan-13
800
Jun-14
Jan-16
600
500
400
300
Mar-14
Jan-16
1,000
Dec-13
Oct-15
700
Sep-13
Oct-14
Vinati Organics Ltd (VO IN, NOT RATED)
1,200
Jun-13
Jul-14
Hindustan Unilever Ltd (HUVR IN, BUY)
Mar-13
Apr-14
LA OPALA RG LTD
Dec-12
Oct-15
HATSUN AGRO PRODUCTS LTD
Jan-14
Oct-13
Jul-13
Apr-13
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Jan-13
200
100
0
100
VINATI ORGANICS LTD
Marico Ltd (MRCO IN, BUY)
AIA Engineering Ltd (AIAE IN, SELL)
MARICO LTD
January 05, 2016
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Sep-15
Jun-15
Mar-15
Dec-14
Sep-14
Jun-14
Mar-14
Dec-13
Sep-13
Jun-13
Mar-13
Dec-12
Mar-14
100
Dec-13
200
Sep-13
300
Jun-13
400
Mar-13
1,400
1,200
1,000
800
600
400
200
0
Dec-12
500
AIA ENGINEERING LTD

Page 25
Strategy
TCPL Packaging Ltd (TCPL IN, NOT RATED)
Poly Medicure Ltd (PLM IN, NOT RATED)

600
800
700
600
500
400
300
200
100
0
500
400
300
200
100
Apr-15
Jul-15
Oct-15
Jan-16
Apr-15
Jul-15
Oct-15
Jan-16
Jul-15
Oct-15
Jan-16
Jan-15
Oct-14
Jul-14
Apr-14
Apr-15
TCPL PACKAGING LTD
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
POLY MEDICURE LTD
Atul Auto Ltd (ATA IN, NOT RATED)
Avanti Feeds Ltd (AVNT IN, NOT RATED)
ATUL AUTO LTD
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
800
700
600
500
400
300
200
100
0
Jan-13
800
700
600
500
400
300
200
100
0
AVANTI FEEDS LTD
KPR MILL LTD

January 05, 2016
Jan-15
Oct-14
Jul-14
Apr-14
Jan-13
Jan-16
Oct-15
0
Jul-15
0
Apr-15
200
Jan-15
200
Oct-14
400
Jul-14
400
Apr-14
600
Jan-14
600
Oct-13
800
Jul-13
800
Apr-13
1,000
Jan-13
1,000
Jan-14
Fiem Industries Ltd (FIEM IN, NOT RATED)
Oct-13
KPR Mill Ltd (KPR IN, NOT RATED)
Jul-13
Apr-13
FIEM INDUSTRIES LTD

Page 26
Strategy
Himatsingka Seide Ltd (HSS IN, NOT RATED)
Fluidomat Ltd (FDM IN, NOT RATED)
250
350
300
250
200
150
200
150
100
HIMATSINGKA SEIDE LTD
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Jan-13
100
50
0
50
FLUIDOMAT LTD
Multibase India Ltd (MUIL IN, NOT RATED)
Nucleus Software Exports Ltd (NCS IN, NOT RATED)
350
300
MULTIBASE INDIA LTD

January 05, 2016
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Jan-16
Oct-15
Jul-15
Apr-15
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
50
0
Apr-13
250
200
150
100
Jan-13
400
350
300
250
200
150
100
50
0
NUCLEUS SOFTWARE EXPORTS LTD

Page 27
Strategy
Explanation of Investment Rating
Investment Rating
Expected return (over 12-month)
BUY
>10%
SELL
NO STANCE
<10%
We have forward looking estimates for the stock but we refrain from assigning valuation and recommendation
UNDER REVIEW
We will revisit our recommendation, valuation and estimates on the stock following recent events
NOT RATED
We do not have any forward looking estimates, valuation or recommendation for the stock
Disclaimer
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January 05, 2016

Ten Baggers 5.0

Exhibit A: Ten baggers 5.0

The greatness philosophy worksyear after year

Source: Ambit Capital research

January 05, 2016

Ambit Capital Pvt. Ltd.

Philosophy and framework

Source: Ambit Capital research

Percentage improvements in performance over FY13-15 vs FY10-12; and

Consistency in performance over FY10-15 i.e. improvements adjusted for

January 05, 2016

Ambit Capital Pvt. Ltd.

The greatness framework

Clearly, this approach will

However, to the extent that

Above median gross block increase (FY13-15 over FY10-12)*

Above median gross block increase to standard deviation

Improvement in asset turnover (FY13-15 over FY10-12)*

Balance sheet discipline

Cash generation and

6 Return ratio improvement

Above median sales increase (FY13-15 over FY10-12)*

Above median sales increase to standard deviation

Above median PBIT margin increase (FY13-15 over FY10-12)*

Above median PBIT margin increase to standard deviation

Below median debt-equity decline (FY13-15 over FY10-12)*

Below median debt-equity decline to standard deviation

Above median cash ratio increase (FY13-15 over FY10-12)*

Above median cash ratio increase to standard deviation

Above median CFO increase (FY13-15 over FY10-12)*

Above median CFO increase to standard deviation

Above median adj. PAT increase (FY13-15 over FY10-12)*

Above median adj. PAT increase to standard deviation

Improvement in RoE (FY13-15 over FY10-12)*

Positive improvement in RoE adjusted for standard deviation

Improvement in RoCE (FY13-15 over FY10-12)*

Positive improvement in RoCE adjusted for standard deviation

Both improvement and the

January 05, 2016

Ambit Capital Pvt. Ltd.

Thus, each of these six

Good, not Great

*The greatness score is

Source: Ambit Capital research

These scores are then

Exhibit 4: Zones of greatness - Financial summary

Good but not great

Mcap (US$ mn)*

Share price (3-year CAGR)#

RoCE (3-year average)

Net debt: equity

January 05, 2016

Ambit Capital Pvt. Ltd.

Does this approach work?

Between 2004-15, Great firms

Outperformance was also seen

January 05, 2016

Ambit Capital Pvt. Ltd.

The live performance of our tenbagger portfolios has been

Tenbagger iteration return

Source: Bloomberg, Ambit Capital research