Systematix Research is also availa ble on Bloombe rg SSSL <Go>, Thomson & Re uters Systematix Shares and Stocks (Ind ia) Limited Investors are advised to refer disclo sures m ad e at th e end of the research repor t. 1 Indoco Remedies Margin miss on reali zation of pro fi t - s hare Indoco Remedies 3 Q FY22 earnings missed our estimates on account of lower profit share reali za tion from Brinzolamide and reduced demand for pa racetamol in th e EU given the sharp inc rease in prod uct p rices T he India business is broadly tr acking management guidance of Rs 8bn + revenues ; however, the regulated market business was hit by shipment del ays due to container unavailability , raw material price in flation and reduced demand for key products ( like paracetam ol ) , and thus trailed below our expectations. We believe the issues are transitionary and expect a rebound in FY23 . Our FY22/23 E EPS is reset by - 10%/ - 7% to factor in the 9 MFY22 performance We roll - forward our val uation to FY24E with a revi sed ta rget price of Rs 508 based on 20x FY24E EPS of Rs 25 Revenue momentum co ntin ues : Revenue grew by 8% Yo Y (in - line) led by stro ng growth in India (+15% Yo Y) and Emerging markets ( +20% YoY ) ; US growth was broadly flat Q o Q , but EU declined 9% QoQ agains t expe ctations of growth . High par a cetamol prices continue to impac t the produc t demand in the EU , though the management expects a sharp rebound in 4 Q as 70 % - 75% of the demand for the product has returned EBITDA grew 22% with margins at 22.5% (150bps belo w our esti mates). Depletion of low - cost inventory , RM inflation (gross margins down 290bps QoQ) and lower profit share realization from Brinzolamide (Rs 8 5 mn dur ing 3Q ) impacted EBITDA – the manage ment expects majo r profit share to accrue by Mar ’ 22 R & D sp end s were down 20 % QoQ after a st eep hi ke in 2Q. I ndia formulations – Growth momentum remain s strong : India business revenue grew 1 5 % YoY driven by strong gro wth in anti - infectives, gastro, uro l o gical and respiratory segment s Indoco’s largest brands Febr ex Plus, Cyclopam and ATM grew 55 %,4 5 %, and 22 % YoY on a low base. MR ( marketing rep resentative s ) strength fo r the India business stands at 2,300 and is u nli kely t o increase in the near - term. MR productivity stands at Rs 2.6la kh PCPM and the company expect s it to reach Rs 3lakh+ in the near term. Indoco took a n aver age price increase o f 5% for non - schedule d drugs , whi le for products under NLEM (11% of domestic formulation) , it would increase p rices by ~ 10% (in - line w ith WPI) , espe cially fo r p roducts where i t has a dominating market share. The company is now ranked 2 6 th in the IPM and has a ma rket share of 0. 67 % (Ap r - Dec ’21 ) G uidance marginal ly scaled d own for regulated marke ts (US, EU): Regulated markets declined by 2% QoQ due t o a fall in E U revenues even a s the US mar ket grew by 3% QoQ. Indoco scaled down its guidance for the US to Rs 2.3 bn (earlier Rs 2.5bn) and EU to Rs 2.8bn ( earlier Rs 3bn) – while the guidance is lower than before , it still implies a sh arp p ic k up in Q4 Guidance for the US wa s scaled down due to the shortage of few API s , while for the EU due to Paracetamol price increase , leading to muted d emand from partners. Indoco is a contract manufacturer for paracetamol in Europe and the current order book for EU stands at Rs 1.2 bn The m anagement expects 4QFY22 to be b etter than 3Q. Teva ’ s market share in Brinzolamide by the end of Dec - 21 was 22% a nd I ndoco realized a pro fit share of Rs 85mn in 3Q ; it expects the larger quantum by the end of Mar - 22. Currentl y , Indoco has 18 products in t h e US ma rke t , of which 5 are injectab le s , 7 ar e ophthalmic and the res t are oral solids. It guided for the laun ch of 3 - 4 m ore oph thalmic products in the US which would be transferred back to Indoco from Teva , with one product having a market size of US D 40 0 mn , a nd would be limited competition. S ystematix Institutional Equities 0 2 Febr u ary 202 2 RESULT UPDATE Sector : Pharmaceuticals Ratin g: BUY C MP: Rs 398 Targ et P rice: Rs 5 08 Stock Info Sensex/Nifty 59,558 /1 7, 780 Bloom berg INDR I N Equ ity sha res 92 mn 52 - wk High/Low R s 530 / 2 74 Face va lue Rs 2 M - Cap Rs 36 bn/ US D 0. 48 bn 3 - m Avg value USD 0 9 mn Financi al Sn apshot ( Rs m n) Y/E Ma rc h F Y22E FY23E FY24E Sales 15,392 17,329 19,399 Gross profit 10,929 12,442 13,928 Gross Margin % 71.0 71.8 71.8 EBITDA 3,281 3,753 4,119 Ma rgi n % 21.3 21.7 21.2 PAT 1,523 2,086 2,337 EPS 17 23 25 DPS(Rs) 0.4 0.4 0.4 ROE(%) 18.1 20.4 18.9 P/E(x) 24.2 17.7 15.8 EV/EBITDA(x) 11.6 9 .7 8.4 Shareh olding pattern (%) June - 21 Sep - 21 Dec - 21 Pro moter 5 8 5 5 8 7 5 8 7 – Pledge d 0 0 0 FII 2.2 2.2 1. 7 DII 18.6 1 7.0 1 7. 3 Others 19. 9 22.1 2 2. 3 Stock Performance ( 1 - year) 200 250 300 350 400 450 500 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 INDR Sensex Praf ul B ohr a prafulbohra @systematixgroup.in + 91 22 6704 8064 Tau si f Shaik h , CFA tausifshaikh @system atixgroup.in +91 22 6 704 8046 0 2 Februar y 202 2 2 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies O ther highlights: US For Goa Plant - I, a request for site ins pection was submitted to the USFDA in Sept’20 ; Indoco is awaiting the date of inspection. API business R evenue decli ned 31 % Y oY i n 3 Q mainly due to captive consumption. Patalganga API fa cility is currently operating at 65% utilization level s Capex / d ebt It has m aintained its g uid ance for capex o f Rs 800mn and cash from operat ions of Rs 3bn in FY22 E I t has a net de bt of Rs 1.2 bn curre ntly Additional line in Goa plant 2 is likely to be commissioned soon , w hich will increase the available capacity by 33%. C apacity utilization is 75 - 80% currently Exhi bit 1: Quarterly financials: (Rs mn) 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY 21 4QFY21 1QFY22 2QFY22 3QFY22 YoY (%) QoQ (%) Revenue 2,926 2,894 2,720 2,759 3 ,282 3,323 3,051 3,868 3,869 3,580 7.7 - 7.5 Consumpt ion of RM 896 828 7 24 816 902 944 879 1,103 1,063 1,087 15.2 2.2 as % of sales 30.6 28.6 26.6 29.6 27.5 28.4 28.8 28.5 27.5 30.4 Em pl oyee costs 641 682 632 658 752 729 6 02 750 742 713 - 2.1 - 3.9 as % of sales 21.9 23.6 23.2 23.9 22.9 21.9 19 .7 19.4 19.2 19.9 R&D 116 129 140 103 157 174 164 165 213 1 71 - 1.4 - 19.8 as % of sales 4.0 4.5 5.1 3.7 4.8 5.2 5.4 4.3 5.5 4.8 Other expenditure 946 9 05 891 695 865 875 859 980 986 875 - 0.1 - 11.3 as % of sales 32. 3 31.3 32.7 25.2 26.4 26.3 28.2 25.3 25.5 24.4 EBITDA 326 349 333 487 607 602 547 869 864 735 22.1 - 15. 0 Margins (%) 11.2 12.1 12.2 17.6 18.5 18.1 17.9 22.5 22.3 20.5 Depreciation 180 176 182 191 18 6 169 186 222 195 192 Other Income 6 7 5 3 5 4 20 9 10 2 Intere st 54 6 9 78 58 59 60 46 42 31 38 PBT 98 111 78 240 368 376 3 36 613 650 506 34.4 - 22.1 Total Tax 20 2 0 24 70 1 11 123 86 216 233 176 Tax rate (%) 20.3 1 7.8 30.9 29.1 30.3 32.6 25.5 35.3 35.8 34.8 Adj. PAT before extr aordinary 78 91 54 170 257 254 250 397 417 330 30.1 - 20.8 Extr aordinary ex penses - - - - 1 - - - - - Reported PAT 78 91 54 170 256 25 4 250 397 41 7 330 30.1 - 20.8 EPS 0.8 1.0 0.6 1.8 2.8 2.8 2.7 4. 3 4.5 3.6 Source: Company, Systemat ix Institutional Research 0 2 Februar y 202 2 3 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies Exhibit 2 : M argin matrix Margins (%) bps bps Gross 69.4 71.4 73.4 70.4 72.5 71.6 71.2 71.5 72.5 69.6 - 196 - 287 EBIDTA 11.2 12.1 12.2 17.6 18.5 18.1 17 .9 22.5 22.3 20.5 241 - 182 EBIT 5.2 6.2 5.7 10.8 13.0 13.1 12.5 16.9 17.6 15.2 206 - 238 PBT 3.3 3.8 2.9 8.7 11.2 11.3 11.0 15.8 16.8 14.1 281 - 266 Adj. PAT 2.7 3.1 2.0 6.2 7.8 7.6 8.2 10.3 10.8 9.2 159 - 1 56 Eff ective Tax rate 20.3 17.8 30.9 29.1 30.3 32.6 25. 5 35.3 35.8 34.8 216 - 104 Source: Company, Systematix Institutional Re search Ex hi bit 3 : Revenue details Reven ue break - up (Rs mn) 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3 QFY22 YoY (%) QoQ (%) Domestic formulation 1,863 1,784 1,600 1,475 1,747 1,576 1,392 2,151 2,136 1,816 15 - 15 US(Gx) 111 161 268 268 434 448 331 462 479 491 10 3 EU 393 454 315 479 561 659 695 792 597 543 - 18 - 9 EM 's 238 218 2 12 208 218 330 292 271 28 0 397 20 42 API 234 187 202 222 228 290 199 109 197 197 - 32 0 CRO 18 31 34 16 35 30 38 28 38 44 43 16 Others 6 4 59 89 91 52 - 14 100 53 140 91 - 761 - 35 Total 2,920 2,894 2,7 20 2,75 9 3,276 3,320 3,048 3,865 3,866 3,578 8 - 7 Source: Comp any, Systematix Instit utional R esearch Exhibit 4 : Indoco - Actual vs System ati x Est (Rs mn) Actual Systema tix.Est 3Q FY22 3 Q FY22E Variation % Revenue 3580 3618 - 1% EBITDA 735 796 - 8% EBITDA % 20.5% 22.0% PAT 330 354 - 7% Source: Company, Syste matix Instit utional Researc h 0 2 Februar y 202 2 4 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies Exhibit 5 : Domestic formulat ion and US drive growth in 3 QFY22 Exhibit 6 : INDR ou tp erforms IPM in 3Q 2.5 2.9 2.9 2.7 2.8 3.3 3.3 3.1 3.9 3.9 3.6 16 24 10 8 9 12 15 12 40 18 8 0 5 10 15 20 25 30 35 40 45 - 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 1QFY20 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3QFY22 Total Revenue (Rs bn) YoY Gr (%) (RHS) 1.6 1.9 1.8 1.6 1.5 1.7 1.6 1.4 2.2 2.1 1.8 8 17 17 10 - 9 - 6 - 12 - 13 46 22 15 -30 -20 -10 0 10 20 30 40 50 0.0 0.5 1.0 1.5 2.0 2.5 1QFY20 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3QFY22 Domestic formulation (Rs bn) YoY Gr (%) (RHS) Source: Co m pany, Systematix Institution al Research Sour ce: Company, Systematix In stitutional Research Exhibit 7 : US - Brinzolamide dri ves recent performance Exh ibit 8 : EU witness es decline in 3Q 25 111 161 268 268 434 448 331 462 479 491 - 78 344 45 66 0 62 3 - 26 40 4 3 -100 -50 0 50 100 150 200 250 300 350 400 0 100 200 300 400 500 600 1QFY20 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3QFY22 US revenue (Rs mn) QoQ Gr (%) (RHS) 379 393 454 315 479 561 659 695 792 597 543 87 45 45 13 26 43 45 121 65 6 - 18 -40 -20 0 20 40 60 80 100 120 140 0 100 200 300 400 500 600 700 800 900 1QFY20 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3QFY22 EU ( Rs mn) YoY Gr (%) (RHS) Source: Company, Systematix Institutional Research Source : Company, Systematix Institutional Research E xhibit 9 : EBITDA tr ajectory im proving Exhibit 1 0 : Operating/ f inancia l l ever age drives hi gher PAT growth 224 326 349 333 487 607 602 547 869 864 735 8.9 11.2 12.1 12.2 17.6 18.5 18.1 17.9 22.5 22.3 20.5 - 5.0 10.0 15.0 20.0 25.0 - 100 200 300 400 500 600 700 800 900 1,000 1QFY20 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3QFY22 EBITDA (Rs mn) EBITDA Margin (%) (RHS) 19 78 91 54 170 257 254 250 397 417 330 - 115 - 205 73 - 53 821 228 179 366 133 63 30 -400 -200 0 200 400 600 800 1000 - 50 100 150 200 250 300 350 400 450 1QFY20 2QFY20 3QFY20 4QFY20 1QFY21 2QFY21 3QFY21 4QFY21 1QFY22 2QFY22 3QFY22 PAT (Rs mn) YoY Gr (%) (RHS) Source: Company, Sy stematix Institutional Research Source: Company, Systematix Insti tu tional Research 0 2 Februar y 202 2 5 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies F I NANCIALS Pr ofit & Loss Statement YE: Mar (Rs mn) FY21 FY22E FY23E FY24E Net Revenues 12,415 15,392 17,329 19,399 YoY gr. (%) 12 24 1 3 1 2 Cost of Goods Sold 3,541 4,464 4,887 5,470 Gross Profit 8,875 10,929 12,442 13,928 Margin (%) 71 71 72 72 Employee Cost 2,740 2,959 3,344 3,779 Other Expenses 3,891 4,688 5,346 6,031 EBITDA 2,243 3,281 3,753 4,119 YoY gr. (%) 82 46 14 10 Margin (%) 18 21 22 21 Depreciation and Amortization 731 815 867 919 EBIT 1,512 2,467 2,886 3,200 Margin (%) 12 16 17 16 Net Interest 223 155 139 123 Other Income 31 31 35 39 Profit Before Ta x 1,320 2,343 2,782 3,116 Margin (%) 2.7 2.7 2.7 2.7 Total Tax 390 820 695 779 Ef fective tax rate (%) 29 35 25 25 Profit after tax 931 1,523 2,086 2,337 EPS 10.1 16.5 22.6 25.4 YoY gr. (%) 286 64 37 12 Source: Company, Systemat ix Institutional Research Balance Sheet YE: Mar (Rs mn) FY21 FY22E FY23E FY24E Equity Share Capital 184 184 184 184 Reserves & Surplus (Ex OC I) 7,506 8,995 11,048 13,351 Net Worth 7,690 9,179 11,232 13,536 Short term debt 1,163 1,163 1,163 1,163 Long term debt 969 769 569 369 Trade payables 1,132 2,109 2,374 2,657 Other Provisions 2,053 2,053 2,053 2,053 Other liabilities - 123 - 123 - 123 - 123 T ota l Liabilities 12,88 5 15,151 17,269 19,656 Net block 5,632 5,617 5,551 5,432 CWIP 681 681 681 681 Other Non - current asset 279 279 279 279 Loans and Advances 68 68 68 68 Cash and Cash Equivalents 143 646 2,014 3,646 Debtors 2,338 3,374 3,798 4,252 In ven tories 2,379 3,121 3,513 3,933 Other current assets 1,365 1,365 1,365 1,365 Total Assets 12,885 15,151 17,269 19,656 S ource: Company, Syste matix Institutional Research Cash Flow YE: Mar (Rs mn) FY21 FY22E FY23E FY24E PBT 1,320 2,343 2,782 3,116 Depreciat ion 731 815 867 919 Interest 2 20 155 139 123 Others 146 0 0 0 Working capital - 1,398 - 801 - 552 - 590 Direct tax - 197 - 820 - 695 - 779 Net cash from Op. activities 822 1,691 2,540 2,789 Net Capital expenditures - 769 - 800 - 800 - 800 Others 102 0 0 0 Net Cash from Invt. activities - 666 - 800 - 800 - 800 Issue of share cap. / premium - - - - Debt changes - 31 - 200 - 200 - 200 Dividend paid - 28 - 34 - 34 - 34 Others - 240 - 155 - 139 - 123 Net cash from Fin. activities - 299 - 388 - 372 - 356 Net change in cash - 143 503 1,368 1,633 Region wise revenue (R s m n ) F Y21 FY22E FY23E FY24E Domestic Formulation 6,313 7,260 8,204 8,204 US 1,600 2,250 2,800 2,800 Europe 2,312 2, 889 3,323 3,323 EM 1,041 1,145 1,259 1, 259 API 1,034 1,163 1,308 1,308 CRO & Others 120 132 145 145 Other operating income 239 250 263 263 Total revenue 12,659 15,089 17,302 17,302 Source: Company, Systematix Institut ion al Research Ratios YE: Mar FY21 FY22E FY23E FY24E Per Share(Rs) EPS 1 0 17 23 25 CEPS 18 25 32 35 BVPS 83 100 122 147 DPS 0 0 0 0 Return Ratio(%) RoC E 17 24 24 23 RoE 13 18 20 19 Balance Sheet Net Debt : Equity (x) 0.3 0.1 0.0 - 0.2 Net Working Capital (Days) 106 104 104 0 Valuation(x) PER 39.6 24.2 17.7 15.8 EV/E BITDA 17.3 11.6 9.7 8.4 EV/Sales 3.1 2.5 2.1 1.8 S our ce: Company, Syst e matix Institutional Research 0 2 Februar y 202 2 6 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies Nikhil Khandelwal Managing Director +91 - 22 - 6704 8001 nikhil@systematixgroup.in Navin Roy Vallab haneni President & Head – IE +91 - 22 - 6704 8065 navin@systematixgroup.in Equity Research Analysts Industry Sectors Desk - Phone E - mail Amar Kedia Infra, Ca p Goods, Logistics, Real E state +91 - 22 - 6704 8084 amarkedia@systematixgroup.in Ashish Poddar Consumer Durables, Building Materials, Small & Midcaps +91 - 22 - 6704 8039 ashishpoddar@systematixgroup.in Ashutosh Joytiraditya Consumer, Retail +91 - 22 - 6704 8068 ashu toshj@systematixgroup.in P raful Bohra Pharmaceuticals and Healthcare +91 - 22 - 6704 8064 prafulbohra @systematixgroup.in Pratik Tholiya Sp ec iality Chem, Agrichem, Sugar and Fertilizer , Textiles and Packaging +91 - 22 - 6704 8028 pratiktholiya @systematixgroup.in R ahul Jain Metals & Mining , Cement +91 - 22 - 6704 8066 rahuljain@systematixgroup .in Rakesh Kumar Banking, Insurance +91 - 22 - 6704 8041 rakes hkumar @systematixgroup.in Ronak Sarda Au to, Auto Ancillaries +91 - 22 - 6704 8059 ronaksarda@systematixgroup.in Shubhranshu Mishra NBFCs & Diversified Financials +91 - 22 - 6704 8024 shubhranshumishra @syste matixgroup.in Harsh Mittal Cement, Building Materials, Pai nts +91 - 22 - 6704 8098 harshmittal@systema tixgroup.in Hena Vora NB FCs & Diversified Financials +91 - 22 - 6704 8045 henavora@s ystematixgroup.in Nikhil Shah Banking, Insurance +91 - 22 - 6704 8091 nikhilshah@s ystematixgroup.in Poorvi Banka Auto, Auto Ancillaries +91 - 22 - 6704 8063 poorvibanka@systematixgroup .in Pranay Shah Consumer Durables, Building Materials, Small & Midcaps +91 - 22 - 67 04 8017 pranayshah@systematixgroup.in Shweta Dikshit Metals & Mining +91 - 22 - 67 04 8042 shwetadikshit@systematixgroup.in Tausif Shaikh Pha rmaceuticals and Healthcare +91 - 22 - 6704 8046 tausifshaikh @systematixgroup.in Varun Gajaria Midcaps +91 - 22 - 6704 8081 v aru ngajaria @systematixgroup.in Equity Sales & Trading Name Desk - Phone E - mail Vipul Sanghvi D irector and Head - Sales +91 - 22 - 6704 8062 vipulsanghvi@systematixgroup.in Ashok Kumar Agarwal Sales +91 - 22 - 6704 8058 ashokagarwal @systematixgroup.in Jigar Kam dar Sales +91 - 22 - 6704 8060 jigarkamdar@systematixgroup.in Nirbhay Kumar Singh Sales +91 - 22 - 6704 80 61 nirbhaysingh @systemat ixgroup.in Rahul Khandelwal Sales +91 - 22 - 6704 8033 rahul @systematixgroup.in Pawan Sharma Director and Head - Sales Trading +91 - 22 - 6704 80 67 pawansharma@systematixgroup.in Mukesh Chaturvedi Vice President and Co Head - Sales Tradin g +91 - 22 - 6704 8074 mukes hchaturvedi @syste matixgroup.in Vinod Bhuwad Sales Tradin g +91 - 22 - 6704 8051 vinodbhuwad@systematixgroup.in Rashmi Solanki Sales Tradin g + 91 - 22 - 6704 8097 rashmisolanki @systematixgroup.in Karan Damani Sales Trading +91 - 22 - 6704 805 3 ka randamani @systematixgroup.in Vipul Chheda Dealer +91 - 22 - 6704 8050 vipulchhe da@sy stematixgroup.in Amit Sawant Dealer +91 - 22 - 6704 8054 am itsawant@systematixgr oup.in Paras Shah Dealer +91 - 22 - 6704 8047 parasshah@systematixgroup.in Suketu Vyas Dea ler +91 - 22 - 6704 8050 suketuvyas @syst ematixgroup.in Corporate Access A udrey Leolyn Mendonca Assistant Vice President +91 - 22 - 6704 8088 a udreymendonca @systema tixgroup.in Production Yukti Vidyarthi Editor +91 - 22 - 6704 8071 yukti@systematixgroup.in Mrun ali Pa gdhare Production +91 - 22 - 6704 8057 mrunalip@systematixgroup.in Vijaye ndra Achrekar Production +91 - 22 - 6704 8089 vijayendraachrekar @syst ematixgroup.in Operat ions Sachin Malusare Vice President +91 - 22 - 6704 8055 sachinmalusare@ systematixgroup.in Sug andha Rane Assistant Vice President +91 - 2 2 - 6704 8056 sugandha@ systematixgro up.in Jignesh Mistry Manager +91 - 22 - 6704 8049 jigneshmistry @ syste matixgroup.in Ravikir an Dasaka Manager +91 - 22 - 6704 8019 ravikiran @ systematixgroup.in Institution al Equities T eam 0 2 Februar y 202 2 7 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies DISC LOSURES/APPENDIX I. ANAL YST CERTIFICATION I, Prafu l Bohra , Tausif Shaikh ; hereby certify that ( 1) views expressed in t his researc h rep ort accurat ely reflect my/our personal views about any or all of the subj ec t securities or issuers referred to in this resear ch report, (2) n o par t of my /our compensation was, is, or will be dir ectly or indirectly rel ated to t he specific re commendatio n s or views expr essed in this rese arch report by Systematix Shares an d Stocks (I ndia) Limited (SSSIL) or its g roup/associate compa nies , (3) reasonable care is taken to achieve and maintain independen ce and objectivity in m aking any recommendatio ns. Disc l osur e of Intere st Statement Updat e Analyst holding in the stock No Served a s an officer, director or employee No II. ISSUER SPECI FIC REGULATORY DISCLO SURES, u nless specifically mentioned in p oint n o . 9 below: 1. The r esea rch a naly st(s), SSSIL , a ssociate s o r re lative s do not have any finan cial interest in the company(ies) c overed in t his report. 2. The r esearch a nalyst(s), SSS IL , a s sociate s or relative s collectively do not hold more than 1% of the se curities of the company (ies) cov ered in this r eport as of the end of the month immediately preceding the distribution of the r esearch r ep ort. 3. The r esearch a nalyst(s), SSSIL , a sso ciate s or relative s did not have any other material conflict of interest at the time of publicatio n of this research repo rt. 4. The r ese arch a nalys t, SSSIL and its a ssociates have not received compens ation for i nvestment banking or merchant banking or bro kerage services or any othe r products or services from the company(ies) cov ered in this report in the past twelve months. 5. The r e s earc h a nalyst, SSSIL or its assoc iates have not managed or co - manage d a priva te or public offering of securities for the co mpany( ies) covered in this report in the previous twelve months. 6. SSSIL or its associates have not recei ved compensati on or other bene fits from t he company(ies) co vered in this report or from any th ird party i n connection with this research report. 7. The r e search a nalyst has no t served as an o fficer, d irector or employee of the company(ies) covere d in this r esearch repo rt. 8. The r esea rch a nalyst and SSSIL have no t been engaged in market making act ivity for t he company(ies) covered in this r esearch rep ort. 9 Details of SSSIL, r esearch a nalyst and its associates pertaining t o the companies covered in this r esearch repor t: Sr. No. P arti culars Yes / No. 1 Whether c ompensation was received from the c ompany(ie s) covered in the r esearch report in the past 12 mon ths for investment ba nking transaction by SSSIL No 2 Whether r esear ch a nalyst, SSSIL or it s associa tes and relati ves collect i vely hold more than 1% of the com pany(ies) covered in the r esearch r eport No 3 Whether compensation has been received by SSSIL or its associates fro m the company(ies) covered in the r esearch repor t No 4 Whether SSSIL or its a ffiliates have managed or co - m anaged a pr ivate or public of fering of securities for the compan y(ies) co ve red in the r esearch report in the previous t welve months No 5 Whether r esearch a nalyst, SSSIL or associates have rece ived compensation for i nvestment banking or me rchant bank i ng o r brokerage services or any o ther products or services from the company(i es ) covered in the r esearch report in the last twelv e month s. No 10. Th ere is no material disciplinary action taken by any regulatory authorit y that im pacts the equi ty research anal ysis activi ties. STOCK RATING S BUY (B): The stock's total return is expec te d to exceed 15% over the next 12 months. HOL D (H): The stock's total re turn is expected to be within - 15% to +15% over the next 12 months. SEL L (S): Th e stock's tota l return is expe cted to giv e negative returns of more than 15% over the next 12 months. N OT RATED (NR): The analyst has no recommendati on on the stock under revie w. INDUSTRY VIEWS ATTRACTIVE (AT): Fundamentals / v aluations of the sect or are ex pected to be a ttractive o v er t he next 12 - 18 months. NEUTRAL (NL): Fundamentals/ v aluations of t he sector a re expected to neither improve nor deteriora te ove r the next 12 - 18 mont hs. CAUTIOUS (CS): Fundamentals/ v aluations of th e sector are expected t o deterio rate over the next 12 - 18 m onth s. III. DISCLAIM ER The information and opinions contained herein have been com pi led or arrived at based on the information o btaine d in good faith from sources believed to be reliable. Such informatio n has not been independ ently ver ified and no g uaranty, re p rese ntation of warranty, express or implied, is made as to its accur acy compl et eness or correctness. This document is for inform ation purposes only. This report is based on information that we cons ider reliable ; we do no t represe nt that it is accurate or comp lete and on e should exercise due caution while acting on it. De scription o f any company (ies) or its/ their securities m ention ed herein are not com plete and this document is not and should not be construed as an offer or solici tation of an o ffer to buy or s ell any sec urities or other f inancial instruments. Past performa nce is no t a guide for future performance, future retur ns are not guaranteed and a loss of original capital may occur. All opinion s, projections and esti mates con stitute the ju dgment of t h e au thor as on the date of the re port and these, plus any other info rmation c on tained in the report, are subject to change withou t notice. Prices and availability of financial instruments are also s ubject to change withou t notice. This report i s intended f or d istribution to institutional investors. This report is not direc ted to or i ntended for display, downloading, printing, reprod ucing or for distribu tion to or use by, any person or entity that is a citizen or resident o r located in any locali ty, state, c ount ry or other jurisdiction wher e such distribution, publication, r eproducti on , availability or use would be contrary to l aw or regulation or what wo uld subject to SSSIL or its affiliates to any re gistration or licensing requirem ent within suc h jurisdict i on. If this rep ort is inadvertent ly sen t or has reached any individu al in suc h country, especially USA, the same may be ign ored a nd brought to the att ention of the sender. Neither this document nor any copy of it may be t aken or t ransmitted int o the Unite d Sta te s (to U.S p ersons), Canada , or Japan or distributed, directly or indir ec tly, in the United States or Canada or distr ibuted or redistributed in Japan or to any resident thereof. Any unauthoriz ed use, duplication, 0 2 Februar y 202 2 8 Systematix Resear c h is al so available on Bloomberg SSSL <Go>, Thom son & Reuter s Systematix Shares and S tocks (India) Limi te d Indoco Remedies re distribut ion or disclos ure of this repo rt includin g, but not limited to, redistribution by electronic m ail, post in g of the report on a website or page, and/or provi ding to a third party a link, is prohibited by law and will result in prosecution. The infor mation co ntained in the r eport is i nten ded solely for the recipient and may not be further distributed by the re ci pient to any third party. SSSIL generally p rohibi ts its analysts, pers ons reporting to analysts, and members of their households from maintai ning a fi nancial intere st in the s e curi ties or der ivatives of any co mpanies that the analysts cover. Ad ditionall y, SSSIL generally prohibits its analysts and person s reporting to analys ts from serving as an officer, director, or advi sory board member of an y compani es that they c over. Our s a lesp eople, trad ers, and other pro fessionals or affiliates may provid e oral or w ritten market commentary or trading strategi es to our clients that refl ect opinions that are contrary to the opinions e xpressed herein. Our pr oprietary trading and i nvesting bu s ines ses may mak e investment decis ions that are inconsistent with the recommen da tions expressed herein. The views expressed in thi s research report ref lect the personal views of the analyst(s) about the subject securities or issues and no part o f the compe n sati on of the r esearch analyst(s) was, is, or will be directly or in directly re lated to the specific recommendations and vi ews ex pressed by research a nalyst(s) in this report. The compensation of th e analyst who prepared this docu ment is determ ined exclus i vely by SSSIL ; however, compensat ion may relate to the revenues of t he System at ix Group as a whole, of which investment ban king, sales and trading are a part. Research analysts and sales persons of SSSIL may provide impor tant inpu ts to its affi liated comp a ny(i es). Foreig n currencies denom inated securities, wherever mention ed, are s ub ject to exchange rate fluctuations which cou ld hav e an adverse effect o n their value or price or the income derived fro m them. In addition, in vestors i n securities s uch as ADRs , the values of which are influenc ed by foreign currencies , effective ly assume c urrency risk. SSSIL, its directors, analysts or em ployees do not take a ny responsibility, financial or otherwise, of th e losses or the damages sustaine d due to the i nvestments m ade or any acti on taken on the ba sis of this report including but no t restric te d to fluctuation in the prices of shares and bonds , changes in the curr ency rates, diminution in the NAVs, reduction in the dividend or income , etc SS SIL and its af filiates, o f fice rs, directo rs, and employees subject to the information given in the disc lo sures may: (a) from time to time, have long or sho rt positions in, and buy or sell , the securities thereof, of company (ies) mentioned herein or (b) be engaged in an y other tra n sact ion involvi ng such securities and earn brokerage or other compen sation (f in ancial interest) or act as a market maker in the f inancial instruments of the company (ies) discussed herein or act as advisor or lender / bor rower to such company ( ies) or hav e oth er potentia l material conflic t of interest with respect to any r ecommenda ti on and related information and opinions. The views expressed are those of the analyst and the c ompany may or may not su bscribe to the views ex pressed t herein. SSSIL , its affil i ates and any th ird party involved in, or related to, computing or co mpiling t he information hereby expressly disclaim all w arrant ies of originality, a ccuracy, completeness, merchantability or fitnes s for a particular purp ose with respect to any of this in f orma tion. Witho ut limiting any of the foregoing, in no event shall S SSIL, any o f its affiliates or any third party involved in, o r related to, computi ng or compiling the information have any liabili ty for any damages of a ny kind. The c ompany ac cepts no li a bili ty whatsoev er for the actions of third parties. The r eport may p rovide th e addresses of, or contain hyperlinks to, webs ites. Except to the extent to which the r eport refers to website material o f the c ompany, the c omp any has n ot reviewed th e linked si t e. A ccessing su ch website or foll owing such link through the report or the we bs ite of the c ompany shall be at your own risk and t he c ompany shall have no liability arising out of, or in connection w ith, any such reference d website SSSIL will not be liab l e fo r any delay or any other inte rruption which may occur in present ing the d at a due to any technical glitch to present the data. In no event shall SS SIL be liable for any damages, including without limitation, direct or indirect, special, inci dental, or c onse quential da mages, losses or e xpenses arising in connection with the data pr esented by SSSIL through this presentation. SSSIL or any of its other g roup companies or associates will not be respons ible for any decisions taken on the basis of t his report. Inve stors are a dvised to consult their i nvestment and t ax consultant s before ta king any investment decisions based on this report Systematix Sh ares and Stocks (India) Limited: R egis tered and C orporate address: The Capital, A - wing, No. 603 – 606, 6th Floo r, Plot No. C - 70, G Block, Bandra Kurla Comple x, Ban dra (East), Mumbai – 400 051 CIN - U65993MH1995PLC268414 | BSE SEBI R eg. No.: INZ000171134 ( Member Co de: 182) | NSE SEBI Reg. N o.: INZ00017113 4 (Member Code: 11 327) | MCX SEBI Reg. No.: INZ000171 134 (Memb er Code: 56625) | NCDEX SEBI Reg. No.: INZ0001 71134 (Member Code: 1281) | Depository Participant SEBI Reg. No.: IN - DP - 480 - 2020 (DP Id: 34600) | PMS SEBI Reg. No.: INP0 00002692 | R esea rch Analyst SEBI Reg. No.: IN H200000840 | Investment Advisor SEB I Reg. No INA000010414 | AMFI : ARN - 64917