AngelTopPicks June 2018

Angel Top Picks – June 2018
Top Picks Market succumbed to various fears like poor coporate earnings, rising crude oil
Company CMP (`) TP (`) prices, globar trade war and lost 2.4% in the month of May after a 5% gain posted
Banking/NBFC in April. Overall, BSE 100 benchmark returns have cooled off to 10% in the past 1
Aditya Birla Capital 139 218 year. Q4 earnings of Nifty 50 companies were down by ~9 % yoy mainly due to
Dewan Housing 605 720 disappointment from the banks and PSUs. This coupled with Karnataka Election
GIC Housing Finance 380 655
jitters and fear of global trade war triggered by Trump tariff threat further
weakened the market sentiments. On the positive side, consumption driven
ICICI Bank 284 416
companies continue to post good results led by buoyant demand. Some of our top
HDFC Bank 2,059 2,315
consumption picks like M&M, Blue Star, Safari Industries and Parag Milk Foods
Consumption
continue to report robust earnings. Overall, our top picks have generated a total
Blue Star 667 867
return of 66% since inception (i.e. October 2015), an outperformance of 32% over
Safari Industries 595 720
BSE 100.
Siyaram Silk Mills 618 851
Multiple factors weakened market sentiments in May- While the revenue growth for
LT Foods 68 128
most companies has been robust, margin pressure was visible for many
Parag Milk Foods 312 410
companies owing to rising input costs. There were signs of recovery in rural
Media/Automobiles/Online
demand seen with FMCG and two wheeler automobiles sales. Amid rising input
Maruti Suzuki 8,871 10,619
cost, pricing power of many consumer discretionary companies would be tested by
M&M 918 1,016
their ability to preserve margins. With the Karnataka election conundrum, the
Music Broadcast 329 475
market has further got worried about the outcome of upcoming Centre elections.
Matrimony.com Ltd. 720 1,016
Global economic scenario has not also been very encouraging with fear of trade
Real Estate/Infra/Logistics/Power war being intensified with Trump tariff threats. On the positive side, GST revenues
KEI Industries 413 589 for the month of March collected in April surpassed `1 trillion, allaying some
Navkar Corp. 141 230 concerns on fiscal deficit.
Source: Angel Research;
Next few month could offer some good investment opportunities- While we
Note: CMP as of 6 June, 2018
anticipate that the market may be in wait and watch mode over next few months
till centre election, this period could also offer opportunities to cherry pick some of
the best equity investment. The best of the market returns are made in the most
uncertain times. We continue to believe that good quality businesses would
outperform others. We prefer select private banks, HFCs and niche consumption
stocks. Investors could also pick at the some of the overly corrected value stocks
which offer high margin of safety. However, we also ask our investors to avoid
bottom fishing stocks which are facing severe corporate governance/ regulatory
issues.
Top picks’ overview

We recommend our top picks as the good bets to utilize this opportunity which are
offering healthy returns in the next 1 year. All of our top picks are backed by sound
business model and are likely to do well in coming years. We remain overweight
on consumption discretionary theme with stocks like Safari Industries, Blue Star and
Parag Milk Foods. Overall, our top picks have generated a total return of 66%
since inception (i.e. October 2015), an outperformance of 32% over BSE 100.
Exhibit 1: Top-Picks Performance

Return Since Inception (30th Oct, 2015) 1 year Return
Top Picks Return 66.2% 18.8%
BSE 100 34.0% 10.0%
Outperformance 32.2% 8.8%
Source: Company, Angel Research
Please refer to important disclosures at the end of this report 1

Angel Top Picks | May 2018
Top Picks
June 12, 2018 3

Stock Info
Dewan Housing
CMP 605  Loan growth to remain strong going ahead: Backed by healthy capital
TP 720 adequacy and increasing demand for home loans DHFL’s loan book is
Upside 19.1% expected to report 23% loan growth over next two three years.
Sector Financials  Strong Capital adequacy lends visibility for growth: DHFL sold 50% stake held
Market Cap (` cr) 19,808 by it in DFHFL Pramerica Life Insurance Co Ltd which added `1,969 cr to its
Beta 1.6 net worth and increases its CAR by 400 bps, to 19.3% which should fuel
growth for next 2-3 years.
52 Week High / Low 680 / 391
 Asset quality has been strong: Strong NIM on the back of lower cost of funds
and lower credit cost will ensure healthy return ratios for the company. Despite
3 year-Chart
700
strong growth the company has maintained stable asset quality and we expect
600
the trend to continue.
500  Outlook: We expect the company’s loan growth to remain 29% over next two
400 years and earnings growth is likely to be more than 29%.We maintain Buy on
300 the stock with a target price of `720.
200
100
Key Financials
-
Y/E Op. Inc NIM PAT EPS ABV ROA ROE P/E P/ABV
Aug-…
Aug-…
Nov-…
Nov-…
Dec-…
May-…
May-…
May-…
March (` cr) (%) (` cr) (`) (`) (%) (%) (x) (x)
Jun-15
Sep-15
Feb-16
Feb-17
Feb-18
FY2019E 3,129 2.6 1,553 49.5 307 1.4 16.5 12.2 2.0

FY2020E 3,879 2.6 1,952 62.2 354 1.5 18.0 9.7 1.7
Stock Info Safari Industries

CMP 595  Safari Industries Ltd (Safari) is the third largest branded player in the Indian
TP 720 luggage industry. Post the management change in 2012, Safari has grown
Upside 21.1% its revenue by 6x in the last 7 years. This has been achieved by foraying in
many new categories like back pack, school bags ( via acquisition of
Sector Luggage
Genius and Genie) and improvement in distribution networks.
Market Cap (` cr) 1,326
 Its margins have more than doubled from 4.1% in FY2014 to 9.1% in
Beta 0.3
M9FY2018, driven by launch of new product categories and business. We
52 Week High / Low 760/268 expect it to maintain 9%+ margins from FY2018 onwards led by regular price
hikes, shift towards organized player and favorable industry dynamics.
3 year-Chart  We expect its revenue to grow by a CAGR of ~25%/40% in revenue/ earnings
800
over FY2018-20E on the back of growth in its recently introduced new
700
products. We have a Buy recommendation with Target Price of `720.
600
500
Key Financials
400
300
Y/E Sales OPM PAT EPS ROE P/E P/BV EV/Sales
200 March (` cr) (%) (` cr) (`) (%) (x) (x) (x)
100 FY2019E 519 10.5 31 13.8 15.3 43.5 6.8 2.6
-
May-…
May-…
May-…
FY2020E 649 11.0 42 18.8 17.5 32.0 5.7 2.1

Jul-16
Jul-17
Jan-16
Sep-16
Jan-17
Sep-17
Jan-18
Aug-15
Jun-15
Oct-15
Dec-15
Mar-16
Nov-16
Mar-17
Nov-17
Mar-18
June 12, 2018 4

Stock Info Mahindra & Mahindra Ltd.

CMP 918  Mahindra & Mahindra Ltd (M&M) is an India-based company, operating in
TP 1,016 nine segments: automotive, farm equipment, IT services, financial services,
Upside 10.6% steel trading & processing, infrastructure, hospitality, Systech (comprising
automotive components and other related products & services), and Others
Sector Automobile
(comprising logistics, after-market, two wheelers and investment).
Market Cap (` cr) 1,11,340
 IMD & Skymet have predicted normal monsoon for FY19 for the third
Beta 0.8 consecutive year which should be a strong trigger for tractor sales growth. In
52 Week High / Low 932/612 our view, strong growth in tractor industry would benefit M&M the most due to
strong brand recall and leadership position in farm tractor.
3 year-Chart  We expect Mahindra & Mahindra (M&M) to report net revenue CAGR of
~15% to ~`62,218cr over FY2018-20E mainly due to healthy growth in
1,000
900 automobile segment like Utility Vehicles (on the back of new launches and
800 facelift of some models) and strong growth in Tractors segment driven by
700
600
strong brand recall and improvement in rural sentiment. Further on the
500 bottom-line front, we expect CAGR of ~15% to `4771cr over the same period
400
on the back of margin improvement. Thus, we recommend an Accumulate
300
200 rating on the stock with target price of `1016.
100
- Key Financials
Jul-16
Jul-17
Jan-16
May-16
Jan-17
May-17
Jan-18
May-18
Aug-15
Sep-16
Sep-17
Jun-15
Oct-15
Dec-15
Mar-16
Nov-16
Mar-17
Nov-17
Mar-18
Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
Source: Company, Angel Research FY2019E 54,939 12.2 4,457 37.5 13.8 24.5 3.4 13.4 1.6
FY2020E 62,235 12.3 5,219 43.9 14.3 20.9 3.0 11.4 1.4
Stock Info Blue Star

CMP 667
 BSL is one of the largest air-conditioning companies in India. With a mere 3%
TP 867 penetration level of ACs vs 25% in China, the overall outlook for the room air-
Upside 29.9% conditioner (RAC) market in India is favourable.
Sector Cons. Durable  BSL's RAC business has been outgrowing the industry by ~10% points over the
Market Cap (` cr) 6,415 last few quarters, resulting in the company consistently increasing its market
share. This has resulted in the Cooling Products Division (CPD)'s share in
Beta 0.2
overall revenues increasing from~23% in FY2010 to ~50% in FY2018
52 Week High / Low 845 / 587
(expected to improve to ~50-55% in FY20E). With strong brand equity and
higher share in split ACs, we expect the CPD to continue to drive growth.
3 year-Chart
900
 Aided by increasing contribution from the Unitary Products, we expect the
800 overall top-line to post revenue CAGR of ~13% over FY2018-20E and
700
margins to improve from 5.8% in FY2018 to 6.2% in FY2020E. We
600
500 recommend a Buy rating on the stock.
400
300 Key Financials
200 Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales
100
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
-
Aug-…
Aug-…
Dec-…
Nov-…
Nov-…
May-…
May-…
May-…
FY2019E 5,352 6.0 177 18.5 20.0 36.1 7.2 20.5 1.2
Jun-15
Sep-15
Feb-16
Feb-17
Feb-18
FY2020E 6,080 6.2 213 22.2 21.9 30.1 6.6 17.5 1.1
Source: Company, Angel Research Source: Company, Angel Research
June 12, 2018 5

Stock Info Siyaram Silk Mills

CMP 618
 SSML has strong brands which cater to premium as well as popular mass
TP 851 segments of the market. Further, SSML entered the ladies' salwar kameez and
Upside 37.7% ethnic wear segment. Going forward, we believe that the company would be able to
Sector Textile leverage its brand equity and continue to post strong performance.
Market Cap (` cr) 2,896  The company has a nationwide network of about 1,600 dealers and business
partners. It has a retail network of 160 stores and plans to add another
Beta 0.7
300-350 stores going forward. Further, the company's brands are sold across
52 Week High / Low 799/379
3,00,000 multi brand outlets in the country.
 Going forward, we expect SSML to report a net sales CAGR of ~14% to
3 year-Chart ~`2,272cr and adj.net profit CAGR of ~14% to `150cr over FY2018-20E on
900
back of market leadership in blended fabrics, strong brand building, wide
800
700
distribution channel, strong presence in tier II and tier III cities and emphasis
600 on latest designs and affordable pricing points. At the current market price,
500 SSML trades at an inexpensive valuation. We have a buy recommendation on
400
the stock and target price of `851.
300
200
Key Financials
100
- Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales
Aug-…
Aug-…
Nov-…
Nov-…
Dec-…
May-…
May-…
May-…
Sep-15
Jun-15
Feb-16
Feb-17
Feb-18
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
FY2019E 1,976 13.5 128 27.3 19.7 22.6 4.5 12.7 1.7
Source: Company, Angel Research FY2020E 2,272 13.3 150 32.0 19.1 19.3 3.7 11.2 1.5
Stock Info Maruti Suzuki

CMP 8,871
 The Automobile sector is expected to benefit from the GST implementation.
TP 10,619 The sector has seen a pick up in the volumes in FY17 as there were several
Upside 19.7% positive factors like normal monsoon and lower interest rates.
Sector Automobiles
 Maruti Suzuki continues to hold ~52% market share in the passenger vehicles.
Market Cap (` cr) 2,67,975 The launch of exciting models has helped the company to ride on the
Beta 1.0 premiumization wave that is happening in the country. In the last two years,
52 Week High / Low 10,000/7,087 company has seen improvement in the business mix with the pie of the utility
vehicles growing from ~4% to current 15%. The 2-3 months of waiting period
of new models, launch of Swift Hatchback in January-2018 and headroom for
3 year-Chart
12,000
more capacity utilization at Gujarat plant is the near term earning triggers.
10,000  Due to the favorable business mix, company has also been seeing
8,000 improvement in the margins. Company has already moved from ~11-12%
6,000 Together with higher operating leverage at Gujarat plant, increasing Nexa
outlets, and improving business mix, we believe that company has further
4,000
room to improve its margins. We have a Buy rating on the stock.
2,000
- Key Financials
Jun-15
Aug-16
Aug-17
Sep-15
Nov-16
Nov-17
Dec-15
May-16
May-17
May-18
Feb-16
Feb-17
Feb-18
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
FY2019E 80,815 15.6 8,506 281.7 21.7 31.4 6.9 17.8 3.2
FY2020E 96,680 16.9 10,991 364.0 22.8 24.3 5.7 13.1 2.6
June 12, 2018 6

Stock Info HDFC

CMP 2,059  Capital infusion to propel growth: Bank has plans to raise `24,000cr capital
TP 2,315 through a combination of QIP and preferential allotment. Of these, `8,500cr
Upside 12.4% has been infused by the bank’s parent company HDFC. Capital Infusion
Sector Banking would help bank to grow advance at healthy CAGR of 22% over FY18-FY20E.
Market Cap (` cr) 5,10,967  Asset quality has been strong: Strong and steady NIM of 4.4% on the back of
lower cost of funds and lower credit cost will ensure healthy return ratios for
Beta 0.8
the company. Despite strong growth, the company has maintained stable
52 Week High / Low 2170/1629
asset quality (GNPA/NPA – 1.3%/0.4%).
 Subsidiaries: HDFC bank’s subsidiaries, HDB Financial Services (HDBFS) and
3 year-Chart HDFC Securities continue to contribute well to the banks overall growth. Their
2,500
net profits for FY18 increased by 39% and 60% yoy, respectively. Strong loan
2,000 book, well-planned product line and clear customer segmentation aided this
1,500 growth.
 Outlook: We expect the company’s loan growth to remain 22% over next two
1,000
years and earnings growth is likely to be more than 21%. We maintain Buy on
500
the stock with a target price of `2315.
-
Key Financials
Aug-15
Aug-16
Aug-17
Jun-15
Jun-16
Jun-17
Oct-15
Dec-15
Oct-16
Dec-16
Oct-17
Dec-17
Apr-16
Apr-17
Apr-18
Feb-16
Feb-17
Feb-18
Y/E NII NIM PAT EPS ABV ROA ROE P/E P/ABV
March (` cr) (%) (` cr) (`) (`) (%) (%) (x) (x)
FY2019E 48,833 4.4 21,765 80.0 532 1.9 17.1 25.7 3.9
FY2020E 56,694 4.4 25,734 94.6 609 1.8 16.3 21.8 3.4
Stock Info Music Broadcast

CMP 329  Radio Industry is protected by licenses for 15 years, thereby restricting the entry
TP 475 of new players. This would support the existing companies to strengthen their
Upside 44.3% position and maintain a healthy growth rate.
Sector Media  It has grabbed the Number 1 position in Mumbai, Bengaluru and Delhi in
Market Cap (` cr) 1,878 terms of number of listener. This is helping MBL to charge premium rate,
which resulting into higher EBITDA margin (33.6%) compare to 22% of ENIL.
Beta 0.5
 MBL outperformed its closest peer with 18.4% CAGR in revenue over FY2013-
17 (ENIL reported 13.2% CAGR in revenue). On the profitability front too,
MBL, with 32.3% CAGR in PAT over FY2013-17, has performed much better
3 year-Chart
than ENIL (-5.2% CAGR in PAT). Moreover, Radio City posted a six year CAGR
500
450 of 12.1% v/s. 9.1% of industry owing to higher advertising volumes.
400
350  Capex for 39 licenses have been done for the next 15 years, hence no heavy
300 incremental Capex requirement would emerge. Moreover, the maintenance
250
200 Capex would be as low as `5-10cr. This would leave sufficient cash flow to
150 distribute as dividend. We have a Buy recommendation on the stock and
100
50
target price of `475.
-
Key Financials
Apr-17
May-17
Jul-17
Jan-18
Apr-18
May-18
Aug-17
Feb-18
Mar-17
Jun-17
Sep-17
Mar-18
Nov-17
Oct-17
Dec-17
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
FY2019E 349 36.2 77 13.4 11.6 24.1 2.8 12.6 4.6
FY2020E 401 36.2 88 15.5 12.1 20.9 2.5 10.5 3.8
June 12, 2018 7

Stock Info
CMP 338
413
KEI Industries
TP 419
589
Upside 42.6%
24%  KEI’s current order book (OB) stands at `2,570cr (segmental break-up: out
Sector Cable
cable which EPC is around `1,425cr and balance from cables, substation & EHV). Its
OB grew by ~28% in the last 3 years due to strong order inflows from State
3,241
Electricity Boards, Power grid, etc.
Beta 1.7
1.3
 KEI’s consistent effort to increase its retail business from 30-32% of revenue in
52 Week High / Low 371
494/206
/ 106
FY18 to 40-45% of revenue in the next 2-3 years on the back of strengthening
distribution network (currently 926 which is expect to increase `1,500 by FY19)
3 year-Chart and higher ad spend (increased from `2cr in FY13 to `7.5cr in FY17 and
600
400
expected to spend).
350
500
300  KEI’s export (FY18 – 16% of revenue) is expected to reach a level 20% in next
400
250
two years with higher order execution from current OB and participation in
200
300
150 various international tenders. We expect a strong ~25% growth CAGR over
200
100 FY2018-20 in exports. We expect KEI to report net revenue CAGR of ~16% to
100
50 ~`4,646cr and net profit CAGR of ~19% to `207cr over FY2017-19E. Hence
--
we have a Buy rating on the stock.
Aug-…
Aug-…
Dec-…
Nov-…
Nov-…
May-…
May-…
May-…
Nov-14
Jul-15
Oct-15
Jul-16
Oct-16
Jul-17
Oct-17
May-15
Jan-16
Apr-16
Jan-17
Apr-17
Feb-15
Jun-15
Sep-15
Feb-16
Feb-17
Feb-18
Key Financials
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
FY2019E 4,049 10.0 174 22.5 22.6 18.4 4.2 9.5 0.9
FY2020E 4,646 10.0 207 26.8 21.6 15.4 3.3 8.1 0.8
Stock Info Source: Company, Angel Research
CMP 430
380
GIC Housing Finance Ltd
TP 655
Upside 72.3%
%  GICHF has healthy capital adequacy, and is seeing an increase in demand for
Sector Real
Financials
Estate
home loans. GICHF’s loan book is expected to report 23% loan growth over
next two years.
2,049
 GICHF is consistently decreasing bank borrowing and increasing high yield
Beta 1.1
1.3 loan book which is expected to boost its Net Interest Margin. The share of
52 Week High / Low 530
623/342
/ 318 bank borrowing was 75% in FY15, which fell to 54% in FY18. In our opinion,
the impetus on lower bank borrowings and increasing high yield loan book is
3 year-Chart likely to result in NIM improvement.
700
600  GICHF’s asset quality is on the higher side compared to other HFCs (As on
600
500 FY17 GNPA-2.4% and NPA-0.2%). This is primarily due to GICHF has not
500
400 written off any bad asset and has not sold any bad assets to ARC. New
400 Management is expediting asset quality improvement.
300
300
200
 We expect the GICHF’s loan growth to grow at a CAGR of 23% over next two
200
years and RoA/RoE to improve from 1.8%/20.3% in FY18 to 1.9%/23% in
100
100
FY20E. We have a Buy rating on the stock.
--
Aug-…
Aug-…
Nov-…
Nov-…
Dec-…
May-…
May-…
May-…
Nov-14
May-15
Oct-15
Oct-16
Oct-17
Jul-15
Jan-16
Apr-16
Jul-16
Jan-17
Apr-17
Jul-17
Feb-15
Key Financials
Jun-15
Sep-15
Feb-16
Feb-17
Feb-18
Y/E Op. Inc NIM PAT EPS ABV ROA ROE P/E P/ABV
Source: Company, Angel Research March (` cr) (%) (` cr) (`) (`) (%) (%) (x) (x)
FY2019E 480 3.8 197 37 215 1.8 22 10 1.8
FY2020E 608 3.9 254 47 256 1.9 23 8 1.5
June 12, 2018 8

Stock Info Navkar

CMP 141
 NCL is one of the largest and one of the three CFS at JNPT with rail
TP 230 connectivity, helping it garner high market share at the port. NCL is in a massive
Upside 63.1% expansion mode where it is increasing its capacity by 234% to 1,036,889 TEUs
Sector Logistics at JNPT and coming up with an ICD at Vapi (with Logistics Park).
Market Cap (` cr) 2,130  The ICD with rail link should benefit from first mover advantage in a region
Beta 0.7 that has huge market potential and accounts for ~27% of volumes at JNPT.
52 Week High / Low 227/135 The ICD should be able to capture the EXIM volumes from the region through
rail link that till now was being custom cleared at JNPT (Import) or being
3 year-Chart transported via road and consolidated at JNPT (Export). South Gujarat
250 volumes will now head straight to the Vapi ICD; thus the company can now
cater to bulk commodities and domestic traffic that it had been rejecting owing
200
to capacity constraints at CFS.
150
 We expect NCL to successfully use its rail advantage and scale up its
100 utilizations at both JNPT and Vapi ICD. We have a Buy rating on the stock.
50
Key Financials
- Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales
Mar-…
Mar-…
Nov-…
May-…
Sep-15
Sep-16
Aug-17
Jun-16
Jun-17
Dec-15
Dec-16
Feb-18
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
FY2019E 516 40.2 117 8.2 7.0 17.2 1.2 10.9 4.4
Source: Company, Angel Research FY2020E 600 40.2 144 10.1 7.9 14.1 1.1 8.9 3.6
Stock Info Matrimony.com Ltd.

CMP 720
 Unmarried population in CY2016 was 107mn, out of which active seekers
TP 1,016
were 63mn. However, active users of the online matrimony segment were only
Upside 41.1% 6mn in CY2016, according to KPMG report. Currently, MCL has 3.08mn
Sector Online active profiles on Matrimony.com. Hence, there is a huge untapped market
Market Cap (` cr) 1,637 opportunity for the company.
 Matrimony.com has high degree of brand recall and trust in India, as
Beta 0.3
evidenced by the average number of website pages viewed by unique visitors
in June 2017 (comScore Report). MCL spends 17-18% (% of sales) on ad
spends every year.
3 year-Chart
 We expect MCL to report net revenue CAGR of ~15% to ~`450cr over
1,200
FY2018-20E mainly due to strong growth in online matchmaking and
1,000
marriage related services coupled by its strong brand recall and large user
800
database. On the bottom-line front, we expect CAGR of ~15% to `83cr over
600
the same period on the back of margin improvement.
400
200
Key Financials
-
Jan-18
May-18
Sep-17
Nov-17
Mar-18
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
Source: Company, Angel Research FY2019E 388 24.6 70 31.0 30.2 23.2 7.0 15.2 3.7
FY2020E 450 25.3 83 36.6 26.3 19.7 5.2 12.2 3.1
June 12, 2018 9

Stock Info LT Foods

CMP 68
 LT Foods LTD (LTFL) is branded specialty Foods Company engaged in milling,
TP 110
processing and marketing of branded/non-branded basmati rice and
Upside 61.7% manufacturing of rice food products in the domestic and overseas markets.
Sector Food Processing
 LTFL’s flagship brand Daawat enjoys 22% market share in the branded rice
market of India. It also has strong market share in North America selling
Beta 1.2
Basmati rice under the brand ‘Royal’. Currently it has access to 1,40,000
52 Week High / Low 109/56 traditional retail outlets, 93% reach of towns with over 2 lakh population,and
a access to 3000 Wholesalers. It has also strong network in modern trade.
3 year-Chart LTFL is the 1st Rice company to place Brown Basmati Rice in Medical Chains.
120
100  The company has a well-diversified product basket catering to consumers of

80 all income groups. The company is present in segments like Basmati rice,
60
Specialty rice (non-Basmati) and other food products.
40  Outlook remains strong with 14%/20% CAGR in the top-line/bottom-line. We

20 have a Buy rating on the stock.
-
Key Financials
Aug-…
Aug-…
Dec-…
Nov-…
Nov-…
May-…
May-…
May-…
Jun-15
Sep-15
Feb-16
Feb-17
Feb-18
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
FY2019E 4,047 10.8 156 4.9 11.5 13.9 1.6 8.4 0.9
FY2020E 4,533 11.0 196 6.1 12.6 11.1 1.4 7.4 0.8
Stock Info Parag Milk Foods

CMP 312  Parag Milk Foods (PARAG) is one of the leading dairy products companies in
TP 410 India. The company has been successful in creating strong brands like GO,
Upside 31.4% Gowardhan and in introducing new products like Whey Protein. It has become
Sector Dairy the 2nd player in processed cheese (after Amul) in a short span of 10 years
Market Cap (` cr) 2,629 and commands 33% market share.
 Value Added Products like cheese, whey protein enjoy higher gross margins
Beta 1.1
of 25-45% versus 6-8% entailed in liquid milk. VAP forms ~66% to its revenue
(the highest among the listed players versus 25-30% for others). Driven by
recently launched products and higher share of VAP, its operating margins
3 year-Chart
would improve in next few years.
400
350  We expect PARAG to report net revenue/PAT CAGR of 18%/36% respectively
300 over FY2018-20E. We recommend a BUY rating on the stock, with a price
250 target of `410.
200
150 Key Financials
100 Y/E Sales OPM PAT EPS ROE P/E P/BV EV/EBITDA EV/Sales
50
March (` cr) (%) (` cr) (`) (%) (x) (x) (x) (x)
-
FY2019E 2,271 10.4 115 13.7 13.4 22.7 2.4 1.2
Jul-16
Jul-17
May-16
Jan-17
May-17
Jan-18
May-18
Sep-16
Sep-17
Nov-16
Nov-17
Mar-17
Mar-18
11.7
FY2020E 2,706 11.1 162 19.3 15.9 16.2 2.1 9.1 1.0
Source: Company, Angel Research Source: Company, Angel Research
June 12, 2018 10

Stock Info ICICI Bank

CMP 284
 ICICI bank has taken a slew of steps to strengthen its balance sheet. Measures
TP 416
such as Incremental lending to higher rated corporates, reducing
Upside 46.4%
concentration in few stressed sectors and building up the retail loan book. The
Sector Banking share of retail loans in overall loans increased to 57% (Q4FY18) from 38% in
Market Cap (` cr) 1,81,152 FY12.
Beta 1.7
 Asset quality likely to stabilize going ahead: ICICI bank’s slippages remained
high during FY18 and hence GNPA went up to 8.8% vs. 5.8% in FY16. We
expect addition to stress assets to reduce and credit costs to further decline
3 year-Chart owing to incremental lending to higher rated corporates and faster resolution
400
in Accounts referred to NCLT under IBC.
350
300
 The gradual improvement in recovery of bad loans would reduce credit costs,
250
200 that would help to improve return ratio. The strength of the liability franchise,
150 shift in loan mix towards retail assets and better rated companies, and
100 improvement in bad loans would be a key trigger for multiple expansion. We
50
recommend a Buy rating on the stock, with a price target of `416.
-
May-…
May-…
May-…
Aug-15
Jan-16
Jul-16
Jan-17
Jul-17
Jan-18
Jun-15
Sep-16
Sep-17
Mar-16
Nov-16
Mar-17
Nov-17
Mar-18
Oct-15
Dec-15
Key Financials
Y/E NII NIM PAT EPS ABV ROA ROE P/E P/ABV
March (` cr) (%) (` cr) (`) (`) (%) (%) (x) (x)
FY2019E 26,118 3.1 9,506 15 148 1.0 9 19 1.9
FY2020E 30,389 3.3 13,292 21 164 1.3 11 14 1.7
Stock
StockInfo
Info Aditya Birla Capital
CMP
CMP 139
863  Aditya Birla Capital (ABCL) is one of the most diversified financial services
TPTP 1091
218 entities, with a presence in non-bank financing, asset management, housing
Upside
Upside 56.8%
26.4% finance, insurance and advisory businesses.
Sector
Sector Pharmaceutical
NBFC
 ABFL (NBFC) business contributes highest value in our SOTP valuation. It has
Market
MarketCap
Cap(`(`cr)cr) 34,875
39025
recorded a strong CAGR of 42% over FY13-18. Despite aggressive growth in
Beta
Beta 0.7 lending and migration to 90dpd for NPA recognition, GNPA has remained at
52
52Week
WeekHigh
High/ /Low
Low 1572/807
264/137 ~1%. We believe ABFL would be able to continue to grow at 28% CAGR over
FY18-FY20E.
33year-Chart
year-Chart
250
 We expect financialization of savings, increasing penetration in Insurance &
Mutual funds would ensure steady growth. Further, Banca tie-up with HDFC
200
Source: Company, Angel Research Bank, DBS and LVB should restore insurance business. We recommend a Buy
150 rating on the stock, with a price target of `218.
100
Key Financials
50
Y/E Op. Inc PAT EPS ABV ROE P/E P/BV
-
March (` cr) (` cr) (`) (`) (%) (x) (x)
Nov-…
Mar-…
Dec-…
May-…
Jun-18
Sep-17
Oct-17
Jan-18
Apr-18
Feb-18
FY2019E 2,309 1,266 5.8 45.1 13 24 3.1

FY2020E 3,319 1,822 8.3 53.3 16 17 2.6
June 12, 2018 11

Research Team Tel: 022 - 39357800 E-mail: research@angelbroking.com Website: www.angelbroking.com
DISCLAIMER
Angel Broking Private Limited (hereinafter referred to as “Angel”) is a registered Member of National Stock Exchange of India Limited,
Bombay Stock Exchange Limited and Metropolitan Stock Exchange Limited. It is also registered as a Depository Participant with CDSL
and Portfolio Manager and investment advisor with SEBI. It also has registration with AMFI as a Mutual Fund Distributor. Angel Broking
Private Limited is a registered entity with SEBI for Research Analyst in terms of SEBI (Research Analyst) Regulations, 2014 vide
registration number INH000000164. Angel or its associates has not been debarred/ suspended by SEBI or any other regulatory
authority for accessing /dealing in securities Market. Angel or its associates/analyst has not received any compensation / managed or
co-managed public offering of securities of the company covered by Analyst during the past twelve months.
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment
decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should
make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities o f the
companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine
the merits and risks of such an investment.
Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals. Investors are advised to refer the Fundamental and Technical Research Reports available on our website to evaluate the
contrary view, if any.
The information in this document has been printed on the basis of publicly available information, internal data and other reliable
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Ratings
June 12,(Based
2018 on expected returns Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%) 12
over 12 months investment period): Reduce (-5% to -15%) Sell (< -15)

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Angel Top Picks – June 2018

Top picks’ overview

Exhibit 1: Top-Picks Performance

Please refer to important disclosures at the end of this report 1

June 12, 2018 3

Source: Company, Angel Research

Stock Info Safari Industries

FY2020E 649 11.0 42 18.8 17.5 32.0 5.7 2.1

Source: Company, Angel Research

Source: Company, Angel Research

June 12, 2018 4

Stock Info Mahindra & Mahindra Ltd.

Stock Info Blue Star

June 12, 2018 5

Stock Info Siyaram Silk Mills

Stock Info Maruti Suzuki

June 12, 2018 6

Stock Info HDFC

Stock Info Music Broadcast

June 12, 2018 7

June 12, 2018 8

Stock Info Navkar

Stock Info Matrimony.com Ltd.

June 12, 2018 9

Stock Info LT Foods

100  The company has a well-diversified product basket catering to consumers of

40  Outlook remains strong with 14%/20% CAGR in the top-line/bottom-line. We

Stock Info Parag Milk Foods

June 12, 2018 10

Stock Info ICICI Bank

FY2019E 2,309 1,266 5.8 45.1 13 24 3.1

June 12, 2018 11

Research Team Tel: 022 - 39357800 E-mail: research@angelbroking.com Website: www.angelbroking.com

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